Skybridge Capital has joined the list of crypto companies halting withdrawals because of the ongoing market conditions. The company has suspended withdrawals for the Legion Strategies Fund, which provides exposure to cryptocurrencies.
Skybridge halts withdrawals
SkyBridge Capital has suspended withdrawals for the Legion Strategies Fund, replicating similar actions several companies took because of the ongoing market conditions. The company’s founder, Anthony Scaramucci, said that this was only a temporary measure and that no liquidations would happen.
Scaramucci was speaking during an interview with CNBC, saying that the board had made the decision. The withdrawals would be suspended until the company can raise the capital needed to sustain the fund.
Scaramucci added that the fund was “unlevered,” and there were no concerns of liquidations. He also added that only 18% of the fund provided exposure to cryptocurrencies. The decision to halt withdrawals was also supported by an independent board. The move would ensure that when people started withdrawing their funds, they would do without causing issues.
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Scaramucci noted that among the crypto exposures for the Legion Strategies fund are Bitcoin and FTX. He added that the fund had dropped by 30% year to date (YTD). Skybridge Capital has other funds that also provide exposure to crypto assets. According to the company’s website, some of its investments in the crypto sector include Kraken, Genesis Digital Assets, Helium Lightning, and NYDIG.
Legion is an offshore fund that is located in the Cayman Islands. Scaramucci said that the fund holds around $250 million. It is also one of the small funds supported by the company. This is the first time the Legion Strategies fund has been suspended since it launched in 1994.
In the interview with CNBC, Scaramucci added that everyone signed an investor agreement. Therefore, no investor was caught unawares by this decision, given the bear market that has persisted in the crypto market in recent months.
Skybridge files for a Bitcoin ETF
Skybridge is among the dozens of crypto companies that have filed applications for a Bitcoin spot exchange-traded fund (ETF) with the US Securities and Exchange Commission (SEC). However, the regulator is yet to approve any of these products, saying they are vulnerable to price manipulation.
Skybridge first ventured into the cryptocurrency market towards the end of 2020. It announced that it was planning to reposition itself to become one of the largest crypto asset management firms.
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