Report from The Verge: ". . .As 3AC demonstrates, a bad loss on one big investment can cause enormous ripple effects, and it can take time to see what they are. Luna collapsed a month ago, and the extent of its damage to 3AC wasn’t obvious until this week. Given the connections between 3AC, Celsius Network, Babel Finance, and the rest of the market, it seems likely cryptocurrency isn’t done bleeding."
Three crypto firms are down bad this week, and things may get worse
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This week has revealed to the average investor just how interconnected cryptocurrency firms are. Two firms have frozen withdrawals, and a cryptocurrency hedge fund is in trouble. Celsius Network, Babel Finance, and Three Arrows Capital are floundering, and it’s not yet clear how extensive the damage may be.
This week started with a Sunday night announcement from the Celsius Network, a gigantic crypto lending company, that it would pause withdrawals and transfers. After that, the value of Bitcoin and other cryptocurrencies, already weeks into a slide that some have termed a “crypto winter,” plunged even further, and five days later, the news hasn’t improved much.
All three firms managed other peoples’ money. Celsius Network wooed retail investors. Babel Finance, which CNBC says has 500 clients, raised $80 million in a funding round a month ago. 3AC, which invested in crypto startups, managed $10 billion in assets in March, according to Fortune. The ripple effects from the firms’ woes are likely to affect the broader cryptocurrency ecosystem. . .
[. ] Meanwhile, in Hong Kong, another crypto lender named Babel Finance has announced its own freeze on withdrawals and redemptions, claiming it’s “facing unusual liquidity pressures.” As recently as May 25th, it had closed a round of funding valuing the company at $2 billion. A report by Decrypt collects claims that Babel misused client funds. Genesis Capital, Bitgo, Blockchain.com, and Bitcoin.com are among its better-known clients. . ."
More details go here >> https://www.theverge.com/2022/6/17/23172539/3ac-celsius-babel-crypto-loans-hedge-funds-uh-oh
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