Crypto lender BlockFi was among several companies liquidating at least a portion of 3AC positions, according to a new report.

Venture capital firm Three Arrows Capital (3AC) has reportedly failed to meet margin calls from its creditors, sparking bankruptcy threats after the cryptocurrency market crash this week triggered the Singapore-based firm’s windfall liquidation.

Crypto lender BlockFi was among the firms to liquidate at least part of 3AC’s positions, according to the Financial Times. Citing people familiar with the matter, the FT reported that 3AC borrowed bitcoin (BTC) from a lender but was unable to meet a margin call after the market soured earlier this week.

The issues surrounding 3AC seem to have affected Finblox, a Hong Kong-based platform that allows investors to earn income from their digital assets. Finblox said it was forced to cut its withdrawal limits on Thursday due to concerns about the venture capital firm.

While estimates vary, 3AC likely lost $400 million as a result of several positions being liquidated. The company had significant influence on Terra (originally Luna, now LUNC) and also held large positions in projects such as Solana (SOL) and Avalanche (AVAX). As Cointelegraph reported, 3AC has spent the past few days moving assets to fund funds across various decentralized finance (DeFi) platforms, most notably Aave (AAVE).

However, the massive liquidations this week were likely driven by the crash in Ethereum (ETH), which fell to $1,000 on its way to its lowest level since December 2020. (GBTC) and Lido’s Staked ETH (stETH) are also responsible for mass liquidations.

Rumors of 3AC’s bankruptcy have surfaced in recent days after Su Zhu, the company’s outspoken co-founder, posted a cryptic tweet that the company was working with “relevant parties” to resolve its issues.

Source: CoinTelegraph

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