Three Arrows-backed Protocol Says Major Chunk of Treasury Is Unaccounted For

06/18 03:37

Acording to Blockworks, a decentralized finance protocol backed by the now-unraveling Three Arrows Capital has a significant portion of its treasury unaccounted for. The protocol has not received any communication from Three Arrows co-founders Zhu and Kyle Davies or the TPS Capital team since June 10, the founder said. The protocol closed its $3.5 million seed funding round, led by Three Arrows, in late 2021. As part of the round, the protocol received stablecoins USD Coin and Tether, which the company could have either actively managed by lending it on a decentralized market or opted to keep all or a portion of it with TPS Capital, Three Arrow’s over-the-counter trading desk. Three Arrows guaranteed 8% annual returns on this treasury management service. Because of the high yields, many protocols backed by Three Arrows decided to keep their funding round capital, plus portions of their own treasuries, with Three Arrows, the founder said. The founder said that the protocol is weighing its legal options and has been in contact with two other Three-Arrows-backed protocols that face the same uncertainty about the state of their treasuries. Another Three Arrows-backed protocol confirmed with Blockworks that the fund asked to manage its treasury, an offer the protocol declined.
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