Merlin Insights: How much did 3AC lose on Aave? Which protocols suffered the most?

Build On Merlin
3 min readJun 23, 2022


Using Merlin by VALK to analyse Three Arrows Capital’s demise amid the market selloff

On-chain transparency still rules supreme in DeFi. Amongst the large selloff of assets in the recent market downturn, Celsius wasn’t the only major seller of stETH on Aave. Three Arrows Capital were also responsible for a cascade of outflows from Aave’s pool.

Merlin’s data analytics engine doesn’t just track aggregate DeFi transactional activity, but provides institutional-grade wallet reporting for individual portfolios, including net worth, PNL and total fee calculations.

As mentioned in a previous Twitter thread, using Merlin’s data engine to document all transactions taking place on Aave’s pool since May, we calculated a total of 464,770 stETH withdrawals. We decided to do a bit of digging since the announcement of Three Arrows Capital’s demise, and we saw two wallets (using Nansen) associated with the fund that were major sellers of astETH during the 7 day period of 7–14th June: 0x3ba… and 0xf30…

Both wallets sent a combined ~88,500 astETH to a burn address (0x000) within the 7-day period. By analysing transactional activity on Merlin, and filtering to view Aave transactions, these mass withdrawals (and some repayments) were confirmed on Merlin. As Merlin’s PNL calculations show, during those 7 days on Aave, wallet 0xf30… lost $3m on its astETH positions and wallet 0x3ba… saw an $8.83M loss. The second wallet’s aggregate losses, since May 16th, totalled over $120M on Aave.

At the same time, stETH liquidations happened at a vast and unprecedented scale, following the large selling pressure. Merlin’s historical data engine counted a peak of over 2,192 stETH liquidated on June 13th.

Not only this, but Merlin measured deposited/withdrawals on Curve’s stETH:ETH pool, with a significant spike between June 6th and 13th — as selling pressure on both ETH and stETH built up. Note that this peaked a bit earlier on June 10th.

To conclude, the major sell-offs in this market related to ETH and stETH led to large outflows from large pools on Curve, Aave and Lido. Merlin was able to aggregate total inflows/outflows that correlated with wallets belonging to Three Arrows Capital.

Sign up below for early access:



Build On Merlin

Merlin is a Decentralized Smart Data Network, allowing you to build smarter applications.