Digital Asset Lender Genesis Confirms Risks Exposure of 3AC's Insolvency
Digital asset lending firm, Genesis Capital, said it would take risks in filing for bankruptcy with Three Arrows Capital but would try to reduce the hedge fund’s bad debt risk as much as possible, according to Bloomberg.
Genesis Capital CEO Michael Moro said Wednesday in a Tweet that if Three Arrows Capital fails to meet margin calls, the company will sell its collateral to hedge against bad debt risks.
At present, the weighted average margin requirement of Sanjian’s loans exceeds 80%. However, the total amount of loans to Genesis Capital has not been disclosed for the time being. Digital Currency Group, the parent company of Genesis, assumed some liabilities of Genesis to ensure its continued operation, Moro added.
Genesis is a global leader in institutional digital asset markets and a full-service digital currency prime brokerage.
Earlier, the embattled cryptocurrency hedge fund, Three Arrows Capital (3AC) has filed for Chapter 15 bankruptcy in the U.S. as it looks to preserve its assets in the country.
Three Arrows Capital was one of the first and most celebrated crypto hedge funds that were founded by Credit Suisse traders, Su Zhu and Kyle Davies.
The woes of Three Arrows Capital were ignited by the collapse of LUNA-UST which the company has a significant amount of exposure. Three Arrows Capital has been ordered into liquidation by the British Virgin Islands court.
Image source: Shutterstock
Voyager Digital Files Chapter 11 Bankruptcy in New York