diff --git a/packages/babel-core/src/transformation/internal-plugins/shadow-functions.js b/packages/babel-core/src/transformation/internal-plugins/shadow-functions.js
index 13e5e955ac..5a5681d67c 100644
--- a/packages/babel-core/src/transformation/internal-plugins/shadow-functions.js
+++ b/packages/babel-core/src/transformation/internal-plugins/shadow-functions.js
@@ -19,7 +19,7 @@ function shouldShadow(path, shadowPath) {
   if (path.is("_forceShadow")) {
     return true;
   } else {
-    return shadowPath && !shadowPath.isArrowFunctionExpression();
+    return shadowPath;
   }
 }
 
@@ -29,7 +29,9 @@ function remap(path, key, create) {
   if (!shouldShadow(path, shadowPath)) return;
 
   let shadowFunction = path.node._shadowedFunctionLiteral;
+
   let currentFunction;
+  let passedShadowFunction = false;
 
   let fnPath = path.findParent(function (path) {
     if (path.isProgram() || path.isFunction()) {
@@ -38,21 +40,37 @@ function remap(path, key, create) {
     }
 
     if (path.isProgram()) {
+      passedShadowFunction = true;
+
       return true;
-    } else if (path.isFunction()) {
+    } else if (path.isFunction() && !path.isArrowFunctionExpression()) {
       if (shadowFunction) {
-        return path === shadowFunction || path.node === shadowFunction.node;
+        if (path === shadowFunction || path.node === shadowFunction.node) return true;
       } else {
-        return !path.is("shadow");
+        if (!path.is("shadow")) return true;
       }
+
+      passedShadowFunction = true;
+      return false;
     }
 
     return false;
   });
 
+  if (shadowFunction && fnPath.isProgram() && !shadowFunction.isProgram()){
+    // If the shadow wasn't found, take the closest function as a backup.
+    // This is a bit of a hack, but it will allow the parameter transforms to work properly
+    // without introducing yet another shadow-controlling flag.
+    fnPath = path.findParent((p) => p.isProgram() || p.isFunction());
+  }
+
   // no point in realiasing if we're in this function
   if (fnPath === currentFunction) return;
 
+  // If the only functions that were encountered are arrow functions, skip remapping the
+  // binding since arrow function syntax already does that.
+  if (!passedShadowFunction) return;
+
   let cached = fnPath.getData(key);
   if (cached) return path.replaceWith(cached);
 
diff --git a/packages/babel-helper-remap-async-to-generator/src/index.js b/packages/babel-helper-remap-async-to-generator/src/index.js
index f22ab48e35..c1aa6d34a2 100644
--- a/packages/babel-helper-remap-async-to-generator/src/index.js
+++ b/packages/babel-helper-remap-async-to-generator/src/index.js
@@ -6,7 +6,7 @@ import template from "babel-template";
 import * as t from "babel-types";
 
 let buildWrapper = template(`
-  (function () {
+  (() => {
     var ref = FUNCTION;
     return function NAME(PARAMS) {
       return ref.apply(this, arguments);
@@ -15,7 +15,7 @@ let buildWrapper = template(`
 `);
 
 let namedBuildWrapper = template(`
-  (function () {
+  (() => {
     var ref = FUNCTION;
     function NAME(PARAMS) {
       return ref.apply(this, arguments);
@@ -24,15 +24,6 @@ let namedBuildWrapper = template(`
   })
 `);
 
-let arrowBuildWrapper =  template(`
-  (() => {
-    var ref = FUNCTION, _this = this;
-    return function(PARAMS) {
-      return ref.apply(_this, arguments);
-    };
-  })
-`);
-
 let awaitVisitor = {
   ArrowFunctionExpression(path) {
     if (!path.node.async) {
@@ -69,19 +60,12 @@ function plainFunction(path: NodePath, callId: Object) {
 
   if (path.isArrowFunctionExpression()) {
     path.arrowFunctionToShadowed();
-    wrapper = arrowBuildWrapper;
   } else if (!isDeclaration && asyncFnId) {
     wrapper = namedBuildWrapper;
   }
 
   node.async = false;
   node.generator = true;
-  // Either the wrapped generator is invoked with `.apply(this, arguments)` or it has no params,
-  // so it should capture `arguments`
-  if (node.shadow) {
-    // node.shadow may be `true` or an object
-    node.shadow = Object.assign({}, node.shadow, { arguments: false });
-  }
 
   node.id = null;
 
diff --git a/packages/babel-helper-replace-supers/src/index.js b/packages/babel-helper-replace-supers/src/index.js
index 76b05d7ad4..7010cb1670 100644
--- a/packages/babel-helper-replace-supers/src/index.js
+++ b/packages/babel-helper-replace-supers/src/index.js
@@ -20,11 +20,7 @@ function isMemberExpressionSuper(node) {
 }
 
 let visitor = {
-  "ObjectMethod|ClassMethod"(path) {
-    path.skip();
-  },
-
-  "FunctionDeclaration|FunctionExpression"(path) {
+  Function(path) {
     if (!path.inShadow("this")) {
       path.skip();
     }
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/async-arrow-in-method/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/async-arrow-in-method/expected.js
index 3d421469f5..a307b98c83 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/async-arrow-in-method/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/async-arrow-in-method/expected.js
@@ -1,19 +1,17 @@
-let TestClass = {
-  name: "John Doe",
-
-  testMethodFailure() {
-    return new Promise((() => {
-      var _this2 = this;
-
-      var ref = babelHelpers.asyncToGenerator(function* (resolve) {
-        console.log(_this2);
-        setTimeout(resolve, 1000);
-      }),
-          _this = this;
-
-      return function (_x) {
-        return ref.apply(_this, arguments);
-      };
-    })());
-  }
-};
+let TestClass = {
+  name: "John Doe",
+
+  testMethodFailure() {
+    var _this = this;
+
+    return new Promise((() => {
+      var ref = babelHelpers.asyncToGenerator(function* (resolve) {
+        console.log(_this);
+        setTimeout(resolve, 1000);
+      });
+      return function (_x) {
+        return ref.apply(this, arguments);
+      };
+    })());
+  }
+};
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/actual.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/actual.js
index 7d51e3957f..54b9fa5000 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/actual.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/actual.js
@@ -1,14 +1,16 @@
-async function s(x) {
-  let t = async (y, a) => {
-    let r = async (z, b) =>  {
-      await z;
-      return this.x;
-    }
-    await r();
-
-    return this.g(r);
-  }
-
-  await t();
-  return this.h(t);
-}
+async function s(x, ...args) {
+  let t = async (y, a) => {
+    let r = async (z, b, ...innerArgs) =>  {
+      await z;
+      console.log(this, innerArgs, arguments);
+      return this.x;
+    }
+    await r();
+
+    console.log(this, args, arguments);
+    return this.g(r);
+  }
+
+  await t();
+  return this.h(t);
+}
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/expected.js
index 9bc186bfde..94c5622431 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/deeply-nested-asyncs/expected.js
@@ -1,37 +1,42 @@
-let s = function () {
-  var ref = babelHelpers.asyncToGenerator(function* (x) {
-    let t = (() => {
-      var _this3 = this;
-
-      var ref = babelHelpers.asyncToGenerator(function* (y, a) {
-        let r = (() => {
-          var _this2 = this;
-
-          var ref = babelHelpers.asyncToGenerator(function* (z, b) {
-            yield z;
-            return _this2.x;
-          }),
-              _this = this;
-
-          return function r(_x4, _x5) {
-            return ref.apply(_this, arguments);
-          };
-        })();
-        yield r();
-
-        return _this3.g(r);
-      }),
-          _this = this;
-
-      return function t(_x2, _x3) {
-        return ref.apply(_this, arguments);
-      };
-    })();
-
-    yield t();
-    return this.h(t);
-  });
-  return function s(_x) {
-    return ref.apply(this, arguments);
-  };
-}();
+let s = (() => {
+  var ref = babelHelpers.asyncToGenerator(function* (x) {
+    var _this = this,
+        _arguments = arguments;
+
+    for (var _len = arguments.length, args = Array(_len > 1 ? _len - 1 : 0), _key = 1; _key < _len; _key++) {
+      args[_key - 1] = arguments[_key];
+    }
+
+    let t = (() => {
+      var ref = babelHelpers.asyncToGenerator(function* (y, a) {
+        let r = (() => {
+          var ref = babelHelpers.asyncToGenerator(function* (z, b) {
+            for (var _len2 = arguments.length, innerArgs = Array(_len2 > 2 ? _len2 - 2 : 0), _key2 = 2; _key2 < _len2; _key2++) {
+              innerArgs[_key2 - 2] = arguments[_key2];
+            }
+
+            yield z;
+            console.log(_this, innerArgs, _arguments);
+            return _this.x;
+          });
+          return function r(_x4, _x5) {
+            return ref.apply(this, arguments);
+          };
+        })();
+        yield r();
+
+        console.log(_this, args, _arguments);
+        return _this.g(r);
+      });
+      return function t(_x2, _x3) {
+        return ref.apply(this, arguments);
+      };
+    })();
+
+    yield t();
+    return this.h(t);
+  });
+  return function s(_x) {
+    return ref.apply(this, arguments);
+  };
+})();
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/expression/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/expression/expected.js
index e3c7d2218f..baff50e27f 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/expression/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/expression/expected.js
@@ -1,8 +1,8 @@
-var foo = function () {
+var foo = (() => {
   var ref = babelHelpers.asyncToGenerator(function* () {
     var wat = yield bar();
   });
   return function foo() {
     return ref.apply(this, arguments);
   };
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/named-expression/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/named-expression/expected.js
index c6282326b3..fabf097a50 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/named-expression/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/named-expression/expected.js
@@ -1,4 +1,4 @@
-var foo = function () {
+var foo = (() => {
   var ref = babelHelpers.asyncToGenerator(function* () {
     console.log(bar);
   });
@@ -8,4 +8,4 @@ var foo = function () {
   }
 
   return bar;
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/options.json b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/options.json
index 54b64ad0fb..78b845844f 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/options.json
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/options.json
@@ -1,3 +1,7 @@
 {
-  "plugins": ["external-helpers", "transform-async-to-generator"]
+  "plugins": [
+    "external-helpers",
+    "transform-es2015-parameters",
+    "transform-async-to-generator"
+  ]
 }
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/parameters/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/parameters/expected.js
index 2cbaf5139e..bee7bb6870 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/parameters/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/parameters/expected.js
@@ -1,6 +1,6 @@
-let foo = function () {
+let foo = (() => {
   var ref = babelHelpers.asyncToGenerator(function* (bar) {});
   return function foo(_x) {
     return ref.apply(this, arguments);
   };
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/statement/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/statement/expected.js
index 51140320d4..4fa3965734 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/statement/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/async-to-generator/statement/expected.js
@@ -1,8 +1,8 @@
-let foo = function () {
+let foo = (() => {
   var ref = babelHelpers.asyncToGenerator(function* () {
     var wat = yield bar();
   });
   return function foo() {
     return ref.apply(this, arguments);
   };
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/import-and-export/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/import-and-export/expected.js
index 7ea795d5ca..5ac84b7eb0 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/import-and-export/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/import-and-export/expected.js
@@ -5,12 +5,12 @@ Object.defineProperty(exports, "__esModule", {
 });
 exports.foo = undefined;
 
-let foo = exports.foo = function () {
+let foo = exports.foo = (() => {
   var ref = babelHelpers.asyncToGenerator(function* () {});
   return function foo() {
     return ref.apply(this, arguments);
   };
-}();
+})();
 
 var _bar = require('bar');
 
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/lone-export/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/lone-export/expected.js
index 3f1072c7e3..99b7a1da10 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/lone-export/expected.js
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/export-async/lone-export/expected.js
@@ -4,9 +4,9 @@ Object.defineProperty(exports, "__esModule", {
   value: true
 });
 
-let foo = exports.foo = function () {
+let foo = exports.foo = (() => {
   var ref = babelHelpers.asyncToGenerator(function* () {});
   return function foo() {
     return ref.apply(this, arguments);
   };
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T6882/options.json b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T6882/options.json
new file mode 100644
index 0000000000..d5312adc2d
--- /dev/null
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T6882/options.json
@@ -0,0 +1,9 @@
+{
+  "plugins": [
+    "external-helpers",
+    "transform-async-to-generator",
+    "transform-es2015-block-scoping",
+    "transform-es2015-arrow-functions",
+    "transform-regenerator"
+  ]
+}
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T7108/actual.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T7108/actual.js
new file mode 100644
index 0000000000..68075431ac
--- /dev/null
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T7108/actual.js
@@ -0,0 +1,33 @@
+class Test{
+  static async method1() {
+    console.log(this);
+
+    setTimeout(async () => {
+      console.log(this);
+    });
+  }
+
+  static async method2() {
+    console.log(this);
+
+    setTimeout(async (arg) => {
+      console.log(this);
+    });
+  }
+
+  async method1() {
+    console.log(this);
+
+    setTimeout(async () => {
+      console.log(this);
+    });
+  }
+
+  async method2() {
+    console.log(this);
+
+    setTimeout(async (arg) => {
+      console.log(this);
+    });
+  }
+}
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T7108/expected.js b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T7108/expected.js
new file mode 100644
index 0000000000..a2dd94f127
--- /dev/null
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/T7108/expected.js
@@ -0,0 +1,59 @@
+class Test {
+  static method1() {
+    var _this = this;
+
+    return babelHelpers.asyncToGenerator(function* () {
+      console.log(_this);
+
+      setTimeout(babelHelpers.asyncToGenerator(function* () {
+        console.log(_this);
+      }));
+    })();
+  }
+
+  static method2() {
+    var _this2 = this;
+
+    return babelHelpers.asyncToGenerator(function* () {
+      console.log(_this2);
+
+      setTimeout((() => {
+        var ref = babelHelpers.asyncToGenerator(function* (arg) {
+          console.log(_this2);
+        });
+        return function (_x) {
+          return ref.apply(this, arguments);
+        };
+      })());
+    })();
+  }
+
+  method1() {
+    var _this3 = this;
+
+    return babelHelpers.asyncToGenerator(function* () {
+      console.log(_this3);
+
+      setTimeout(babelHelpers.asyncToGenerator(function* () {
+        console.log(_this3);
+      }));
+    })();
+  }
+
+  method2() {
+    var _this4 = this;
+
+    return babelHelpers.asyncToGenerator(function* () {
+      console.log(_this4);
+
+      setTimeout((() => {
+        var ref = babelHelpers.asyncToGenerator(function* (arg) {
+          console.log(_this4);
+        });
+        return function (_x2) {
+          return ref.apply(this, arguments);
+        };
+      })());
+    })();
+  }
+}
diff --git a/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/options.json b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/options.json
index 94bdeeb0eb..6b5744a918 100644
--- a/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/options.json
+++ b/packages/babel-plugin-transform-async-to-generator/test/fixtures/regression/options.json
@@ -1,3 +1,6 @@
 {
-  "plugins": ["external-helpers", "transform-es2015-block-scoping", "transform-regenerator", "transform-async-to-generator"]
+  "plugins": [
+    "external-helpers",
+    "transform-async-to-generator"
+  ]
 }
diff --git a/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/expression/expected.js b/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/expression/expected.js
index 1d7bf3bba5..d4567b0dea 100644
--- a/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/expression/expected.js
+++ b/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/expression/expected.js
@@ -1,5 +1,5 @@
 import { coroutine as _coroutine } from "bluebird";
-var foo = function () {
+var foo = (() => {
   var ref = _coroutine(function* () {
     var wat = yield bar();
   });
@@ -7,4 +7,4 @@ var foo = function () {
   return function foo() {
     return ref.apply(this, arguments);
   };
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/named-expression/expected.js b/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/named-expression/expected.js
index 082562347d..91a3c61229 100644
--- a/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/named-expression/expected.js
+++ b/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/named-expression/expected.js
@@ -1,5 +1,5 @@
 import { coroutine as _coroutine } from "bluebird";
-var foo = function () {
+var foo = (() => {
   var ref = _coroutine(function* () {
     console.log(bar);
   });
@@ -9,4 +9,4 @@ var foo = function () {
   }
 
   return bar;
-}();
+})();
diff --git a/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/statement/expected.js b/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/statement/expected.js
index ef7b97d56b..72167461b0 100644
--- a/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/statement/expected.js
+++ b/packages/babel-plugin-transform-async-to-module-method/test/fixtures/bluebird-coroutines/statement/expected.js
@@ -1,6 +1,6 @@
 import { coroutine as _coroutine } from "bluebird";
 
-let foo = function () {
+let foo = (() => {
   var ref = _coroutine(function* () {
     var wat = yield bar();
   });
@@ -8,4 +8,4 @@ let foo = function () {
   return function foo() {
     return ref.apply(this, arguments);
   };
-}();
+})();
diff --git a/packages/babel-traverse/src/path/ancestry.js b/packages/babel-traverse/src/path/ancestry.js
index 7e52857056..e7c3217093 100644
--- a/packages/babel-traverse/src/path/ancestry.js
+++ b/packages/babel-traverse/src/path/ancestry.js
@@ -188,30 +188,57 @@ export function inType() {
 }
 
 /**
- * Check if we're inside a shadowed function.
+ * Checks whether the binding for 'key' is a local binding in its current function context.
+ *
+ * Checks if the current path either is, or has a direct parent function that is, inside
+ * of a function that is marked for shadowing of a binding matching 'key'. Also returns
+ * the parent path if the parent path is an arrow, since arrow functions pass through
+ * binding values to their parent, meaning they have no local bindings.
+ *
+ * Shadowing means that when the given binding is transformed, it will read the binding
+ * value from the container containing the shadow function, rather than from inside the
+ * shadow function.
+ *
+ * Function shadowing is acheieved by adding a "shadow" property on "FunctionExpression"
+ * and "FunctionDeclaration" node types.
+ *
+ * Node's "shadow" props have the following behavior:
+ *
+ * - Boolean true will cause the function to shadow both "this" and "arguments".
+ * - {this: false} Shadows "arguments" but not "this".
+ * - {arguments: false} Shadows "this" but not "arguments".
+ *
+ * Separately, individual identifiers can be flagged with two flags:
+ *
+ * - _forceShadow - If truthy, this specific identifier will be bound in the closest
+ *    Function that is not flagged "shadow", or the Program.
+ * - _shadowedFunctionLiteral - When set to a NodePath, this specific identifier will be bound
+ *    to this NodePath/Node or the Program. If this path is not found relative to the
+ *    starting location path, the closest function will be used.
+ *
+ * Please Note, these flags are for private internal use only and should be avoided.
+ * Only "shadow" is a public property that other transforms may manipulate.
  */
 
 export function inShadow(key?) {
-  let path = this;
-  do {
-    if (path.isFunction()) {
-      let shadow = path.node.shadow;
-      if (shadow) {
-        // this is because sometimes we may have a `shadow` value of:
-        //
-        //   { this: false }
-        //
-        // we need to catch this case if `inShadow` has been passed a `key`
-        if (!key || shadow[key] !== false) {
-          return path;
-        }
-      } else if (path.isArrowFunctionExpression()) {
-        return path;
-      }
+  let parentFn = this.isFunction() ? this : this.findParent((p) => p.isFunction());
+  if (!parentFn) return;
 
-      // normal function, we've found our function context
-      return null;
+  if (parentFn.isFunctionExpression() || parentFn.isFunctionDeclaration()) {
+    let shadow = parentFn.node.shadow;
+
+    // this is because sometimes we may have a `shadow` value of:
+    //
+    //   { this: false }
+    //
+    // we need to catch this case if `inShadow` has been passed a `key`
+    if (shadow && (!key || shadow[key] !== false)) {
+      return parentFn;
     }
-  } while (path = path.parentPath);
+  } else if (parentFn.isArrowFunctionExpression()) {
+    return parentFn;
+  }
+
+  // normal function, we've found our function context
   return null;
 }