In effort to protect its US assets while a liquidation is carried out in the British Virgin Island, Crypto hedge fund Three Arrows Capital (3AC) has filed for Chapter 15 of the U.S. Bankruptcy Code.

Court papers show  that the representatives for Three Arrows filed the bankruptcy petition in New York on Friday. The Chapter 15 bankruptcy filings will prevent creditors from seizing a company’s assets in the US. 

A person familiar with the matter told Reuters on Wednesday, Singapore-based 3AC is one of the highest-profile investors hit by the sharp sell-off in crypto markets and is being liquidated. 

Three Arrows Capital was ordered to liquidate earlier this week by a British Virgin Islands court. According to blockchain analytics firm Nansen, the fund which was founded by former Credit Suisse traders Zhu Su and Kyle Davies, managed an estimated US$10 billion of assets as recently as March.

The embattled fund was accused by Singapore’s financial regulator on Thursday of exceeding its assets threshold and providing false information.

Representing Three Arrows in the US bankruptcy was the law firm Latham & Watkins. 

Chapter 15 is used by Non U.S.-companies to block creditors who want to file lawsuits or tie up assets in the United States.

The case is Three Arrows Capital Ltd and Russell Crumpler, 22-10920, US Bankruptcy Court for the Southern District of New York (Manhattan).


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