Cryptocurrencies, which had surged on June 15 after US Federal Reserve Chair Jerome Powell sounded a firm inflationary stance, gave up their gains yesterday amid renewed market concerns about increasing prices, global turmoil, and a potential recession.
Meanwhile, in an effort to allay fears about spreading risk from alleged problems at crypto hedge fund Three Arrows Capital, crypto payments system BlockFi said it was continuing with normal operations and that no customer had been harmed.
BlockFi stated on Twitter that a prominent customer recently failed to satisfy its commitments on an over-collateralized margin loan and that it “completely escalated the loan and fully disposed of or hedged all the related assets.”.
BlockFi liquidates Three Arrow investment
The Financial Times recently revealed that BlockFi was one of the entities that liquidated some of Three Arrows’ investments when the crypto hedge fund failed to respond to margin calls.
The crypto sector has been shocked by the collapse of key lending platform Celsius Network, which has blocked withdrawals since Sunday. Celsius Network blocked the service after Three Arrows’ faced the trouble. Market players are anxious that additional businesses may be harmed as a result of collateral damage.
Deribit, the holding company in which Three Arrows is a shareholder, said on Twitter Thursday (June 16) that it is still “economically strong” although it has debt that it still considers “possibly unstable”.
Three Arrows, located in Singapore, is one of the world’s largest participants in the crypto sector, with investments and tokens in a diverse variety of crypto ventures.
On June 14, co-founder Zhu Su took to Twitter saying the company was dedicated to “fixing this,” but didn’t elaborate. Three Arrows initially did not respond to any comments.
