The bankruptcy administrator overseeing the liquidation of the FTX exchange is formally challenging a massive $15.3 billion claim filed by the now-defunct Three Arrows Capital (3AC). The trustee asserts that the hedge fund’s alleged losses originated from broader market volatility and client withdrawals, not directly from actions taken by FTX itself.
Bankruptcy court previously elevated 3AC’s creditor claim from an initial $1.2 billion estimate to the disputed $15.3 billion figure. This increase significantly amplified the stakes and scrutiny surrounding the claim in the complex FTX insolvency proceedings. 3AC’s legal arguments hinge on the allegation that FTX liquidated approximately $15 billion of its assets shortly before the exchange’s collapse.
FTX’s legal representatives counter that the hedge fund’s $15.3 billion claim relies on flawed and inaccurate data. They point to events following the Terra ecosystem crash; specifically, that significant withdrawals by 3AC quickly depleted its account balance on FTX to less than $240 million by late June 2022, despite a substantial $18 million Ether withdrawal. Consequently, FTX states it had to liquidate $8.2 billion in positions to offset its exposure to 3AC.
The contested claim has entered a key procedural phase. 3AC faces a court deadline to submit its formal response. A hearing is then scheduled to resolve the dispute surrounding the validity and amount of 3AC’s claim against the FTX estate.