Tyr Capital, a crypto hedge fund, is facing allegations of criminal mismanagement due to purportedly disregarding its internal risk limit through excessive exposure to FTX. Following a complaint by TGT, another hedge fund that invested with Tyr, Swiss prosecutors have raided the premises of the accused firm.
As reported by Crypto News, Tyr Capital came under investor scrutiny in August 2023. The investors expressed apprehension about the company's elevated risk exposure to FTX crypto exchange. The latter eventually declared bankruptcy and ceased operations. TGT is now seeking control over the remaining assets, which includes a claim of $22 million against FTX.
TGT alleges that it had voiced concerns to Tyr and its Chief Investment Officer about the financial stability of FTX between November 7-10 of 2022. This period coincided with the week when FTX collapsed under former CEO Sam Bankman-Fried. As per an article in Financial Times, Tyr did not attempt to withdraw assets from FTX until the day the exchange filed for bankruptcy. In November 2022, FTX filed for Chapter 11 bankruptcy, reporting an $8 billion deficit in its accounts.
Beyond this allegation, TGT also lodged a criminal complaint against Tyr in 2023 over 'the criminal offence of criminal management'. This was accompanied by a request for a raid on the fund manager's offices. The complaint indicates that a portfolio containing TGT's remaining assets suffered an 84% loss in dollar terms from October 2022 to January 2023. However, Tyr has refuted this claim, stating that the quoted figure of an 84% loss is incorrect.
