Three Arrows Capital (3AC) Reclaims $45M From Convex Finance & Curve

3AC takes out a big chunk of their assets On Curve & Convex with vague intentions

Three Arrows Capital 3AC Reclaims 45M From Convex Finance & Curve

Insolvent crypto hedge fund Three Arrows Capital (3AC) is at the center of attention once again after some mystifying transactions were spotted on Tuesday evening. Firstly, the wallet address linked to Three Arrows Capital withdrew 20,945 Lido Staked Ether (stETH), worth an approximate $33.3 million USD. The funds had been staked on Curve Finance, however, that wasn’t the end of the story, as a multitude of other transactions followed just hours later.

Three Arrows Capital (3AC) Takes out Multiple Assets

Immediately after the hefty withdrawal from Curve, the execs of Three Arrows Capital went on to retrieve $4 million in Tether (USDT), and a further $4 million in Wrapped Bitcoin (wBTC). The wallet linked to Three Arrows Capital was then topped up with an additional installment of $4 million worth of Wrapped Ether (wETH), putting the firm’s Convex Finance withdrawals at a cumulative $12 million.

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Teneo, the liquidators appointed by the British Virgin Islands court, has so far refrained from commenting on the situation. Up to now, liquidators Crumpler & Farmer have been playing a cat and mouse game with Su Zhu and Kyle Davies. The liquidators found nothing but an empty office with dusty mail piled up on their first visit to the Three Arrows Capital headquarters, and were ghosted in a later emergency Zoom meeting as well. On top of that, Su Zhu broke his silence a month later, admonishing the liquidators for their bad manners.

An Act of Desperation or a Well-calculated Step?

One potentially valid explanation for the withdrawal of Lido Staked Ether and Wrapped Ether could be related to the upcoming Ethereum 2.0 event, dubbed ‘the Merge. Many crypto platforms across the sector have paused all transfers related to Ethereum (ETH) until such a time as the Merge has been completed, meaning that this move could have been made in anticipation of that. However, this does not explain the withdrawal of the rest of the digital assets.

According to court proceedings, 3AC owes a whopping $3.5 billion spread across at least 27 companies. The biggest among the 27 is Genesis, owned by the Digital Currency Group (DCG). Despite refusing to comment on the recent developments, Teneo has confirmed that they are exerting their best efforts to “maximize asset recoveries on behalf of all creditors.”

On the Flipside

Why You Should Care

The Terra (LUNA) washout on May caused a domino effect across the crypto industry. 3AC had seemed, to all intents and purposes, to be a prospering crypto fund, but the exposure to Terraform Labs in the form of $600M in investments marked the start of the hedge fund’s regrettable ending.

Read about Three Arrows Capital (3AC) founders’ melodramatic detention in Dubai.

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Find out how the founders of 3AC filed a $30M claim against own company while on the run.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Tadas Klimasevskis

Tadas Klimaševskis is a Lithuanian journalist at DailyCoin, specializing in covering the lighter side of the crypto industry such as memecoins and pop culture in the metaverse. He has experience as a music artist, English language teacher, and freelance writer, and uses his creative writing skills to summarize valuable information in his work. He is also a strong believer in the potential of blockchain and spends his free time listening to music, traveling, and watching basketball games.