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A trading company accuses Three Arrows Capital of stealing $1 million

A trading company accuses Three Arrows Capital of stealing $1 million

The head of 8BlocksCapital said the cryptocurrency hedge fund 3AC stole their assets so as to secure borrowed funds and evade bankruptcy.

According to 8BlocksCapital CEO Danny Yuan, the companies entered into an agreement in November 2020 stating that 8BlocksCapital would pay a fee for using Three Arrows Capital trading accounts, with 100% of profits to be owned by 8BlocksCapital, whereby the fund would not be allowed to operate the funds without permission.

He said that on June 12, 8BlocksCapital withdrew some money from its 3AC accounts, but on June 13, the fund failed to respond to a withdrawal request for additional funds. Later, the company spotted that about $1 million was missing from the accounts. 8BlocksCapital repeatedly tried to contact the 3AC team in writing and by phone, but without any success.

Yuan writes that 3AC used borrowed funds and suffered losses. He claims that the fund directed company money to replenish its trading accounts while receiving margin calls.

The head of 8BlocksCapital also called on the platforms holding the Three Arrows Capital funds to freeze them so that the fund could pay back debts after possible litigation. Following a lengthy silence, Three Arrows Capital co-founder and CEO Zhu Su commented on the situation on his Twitter account.

"We are in the process of communicating with relevant parties and fully committed to working this out," wrote Three Arrows Capital co-founder and CEO Zhu Su.

The fund suffered losses during the Terra ecosystem collapse and faced further problems when major cryptocurrency lender Celsius Network suspended all withdrawals, swaps, and transfers between accounts. 

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