Friday, Jun 17th 2022

Crypto Three Things (6/17)

Commentary

“There's more beauty in truth, even if it is dreadful beauty.”-John Steinbeck

1) Crypto lender BlockFi liquidates Three Arrows Capital: The Singapore-based hedge fund failed to meet margin calls this past weekend. As a result, the group could not meet demands from lenders, including BlockFi, who reduced its exposure by using its collateral from its financing activities. Three Arrows Capital is said to manage an estimated $10B and had a significant investment in Terra – a ~$560M bet that is now worth roughly $670. 

Titan’s Takeaway: Funding pressures continue to mount in the struggling crypto-investment space. Such overexposed and over-leveraged crypto investments as those of Three Arrows Capital will likely be the first to go in harsh market conditions.

2) Musk sued for $258B by a single Dogecoin investor: The billionaire and his two companies, Tesla and SpaceX, were accused of running a dogecoin pyramid scheme for “profit, exposure, and amusement.” The plaintiff, Keith Johnson, says Dogecoin has “no value at all” and asks for $86B in damages.

Titan’s Takeaway: While it’s true that Dogecoin experienced excessive hype largely thanks to Musk’s tweets, $86 billion in damages seems a bit steep considering it is 3 times Dogecoin’s market decline since May 2021.

3) Animoca Brands boosts stake in educational tech company TinyTap to 84.1%: The gaming investment firm paid $38.9M to acquire 84.1% of TinyTap – an educational tech company enabling users to create and post content. The firm raised $360M earlier this year at a $5B valuation and just last week announced that its investment portfolio exceeded $1.5B. 

Titan’s Takeaway: This partial acquisition is the latest in a string of financial injections from Animoca Brands. We expect Animoca Brands to continue to use its dominant share to tilt the platform into more blockchain-related content production.

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