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Three Arrows Capital , the defunct crypto hedge fund, has its liquidators pursuing a $1.3 billion lawsuit against TerraForm Labs, the bankrupt digital assets company co-founded by Do Kwon.
This legal action is part of ongoing efforts to recover funds for 3AC’s creditors following the fund’s collapse., induced 3AC to invest heavily in these assets before they were wiped out. The collapse of these tokens not only erased 3AC’s investment but also caused substantial losses in the fund’s other digital holdings.
In January 2022, 3AC acquired $190 million worth of Luna as part of a broader $1 billion deal, which included investments from other firms. However, a massive sell-off of TerraUSD just a few months later triggered a sharp decline in both TerraUSD and Luna, severely depleting the value of 3AC’s investment.
By the end of April 2022, 3AC’s Luna holdings were valued at approximately $462 million, but by May 14, that value had plummeted to just over $2,700. Simultaneously, the net value of 3AC’s other digital assets dropped by about $858 million.Once a prominent figure in the crypto hedge fund industry, Three Arrows Capital saw its downfall closely following the collapse of LUNA.
Notably, following the crash of the LUNA project, TerraForm’s co-founder Do Kwon was arrested in Montenegro last year. He now faces charges in both the United States and his home country, South Korea.COTI V2 Underway, Garbled Circuits Integration and Privacy Breakthroughs: Interview with CEO Shahaf Bar-GeffenAI is Going to be the Center of our Lives, Like it or Not: Akash Network’s Greg Osuri One Weekly Email Can Change Your Crypto Life.
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