Crypto lending platforms are not in a good position right now with bankruptcy hovering around businesses. The main ones are Three Arrow Capital (3AC) and Celsius.
As per the filings made from Trustee Teneo, a crypto hedge fund, Three Arrow Capital or also known as 3AC has been submerged with its debts that are worth $3.5 billion made to 30 companies.
One of the documents states that among many other loans, 3AC had also borrowed a $75 million loan from Celsius, another crypto lending platform that also filed for bankruptcy.
According to the filings made in court, Celsius has given two loans for 3AC in USDC stablecoin which are worth $50 million and $25 million. Hence, now it’s clear that Celcius, Three Arrow Capitals, and Terra (LUNA) crash are all interconnected.
Right after the collapse of Terra, 3AC also followed the worst on general market sentiment. This was followed by huge withdrawals on the Celsius platform which led to the decision to stop all its withdrawals.
Another fact that was revealed from the filing is that Genesis Asia Pacific Ltd is also one of the biggest lenders where the loan amount stands at $2.36 billion.
Additionally, 3AC loans were relatively collateralized, including 17,443,644 shares of Grayscale Bitcoin Trust; 2,739,043.83 AVAX tokens; 13,583,265 NEAR tokens; and 446,928 shares of Grayscale Ethereum Trust.
Though Genesis made an attempt to recover the loan, it was never cleared as 3AC filed for Chapter 15 bankruptcy.
The 3AC bankruptcy filing was followed by Celsius
After July 1, once 3AC filed for bankruptcy, Celsius also filed for bankruptcy. After declaring bankruptcy, Celsius revealed that it was supposed to pay customers $4.7 billion, which the company is currently unable to repay.
As per the Santiment data, the price of Celsius has been pulled down as it was forecasted which is followed by the Celsius platform’s profit loss ratio where only losses are more prominent than profit.
