Trouble at crypto hedge fund Three Arrows Capital triggers fears of contagion

Photographer: Chris Ratcliffe/Bloomberg

Rumors of cryptocurrency hedge fund Three Arrows Capital being on the brink of insolvency have sent shockwaves through the crypto space, with industry observers predicting more trouble for the decentralized finance (DeFi) sphere as contagion spreads.

Three Arrows, also known as 3AC, is one of the highest-profile players in DeFi — a crypto ecosystem aiming to bypass traditional financial intermediaries through blockchain technology. With an estimated $10 billion in assets under management (AUM) in March according to blockchain analytics platform Nansen, the fund has invested in a number of crypto and DeFi firms.

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