It wasn’t the collapse of the cryptocurrency luna that ultimately caused the downfall of Three Arrows Capital, according to 3AC co-founder Kyle Davies. Instead, it was the firm’s final position being liquidated on FTX. 

Davies broke down how the hedge fund unwound on a podcast with hedge fund manager Hugh Hendry. He claimed that the fund survived the collapse of luna, the ensuing credit squeeze and decline of crypto prices — only to succumb when it was liquidated by FTX. He also claimed FTX and Alameda shared internal information and that the trading firm knew its liquidation level and deliberately hunted it. 

(by Tim Copeland)