Genesis Trading CEO Michael Moro has confirmed the cryptocurrency OTC platform liquidated the positions of hedge fund Three Arrows Capital (3AC) last month.
He has explained that the platform immediately got rid of the collateral that the hedge fund used to obtain the loan. This happened after the price declined below the maintenance margin, which averaged over 80%. He has added:
“Since then [parent] DCG and I have been looking for the best strategy to further isolate risk. The company has assumed a portion of Genesis’ losses associated with 3AC to ensure that we have sufficient capital to run and expand our business in the long term.”
The information about the insolvency of 3AC appeared against the background of the collapse of the crypto market and the Terra ecosystem.