Three Arrows Capital on the Run
Market Meditations | October 18, 2022
In early July, Singapore-based cryptocurrency hedge fund Three Arrows Capital (3AC) filed for Chapter 15 bankruptcy. Co-Founders Su Zhu and Kyle Davies have now vanished.
- 3AC suffered from the TerraLuna collapse that wiped out $40 billion for investors and other key stakeholders. Prior to the collapse, 3AC had invested at least $200 million in LUNA alone.
- In the legal filings, 3AC blamed the bear market for their collapse, stating that “the Debtor’s business has collapsed in the wake of extreme fluctuations in cryptocurrency markets“.
- The drama continues for 3AC as Teneo, the liquidator appointed to finalise the hedge fund’s affairs has asked a judge to issue subpoenas to Su Zhu and Kyle Davies.
- The request will be sent via Twitter and email to the fund’s founders as they have not been responding to traditional methods.
- Both co-founders have failed to sufficiently cooperate with the liquidators, and Davies has reportedly failed to disclose the access to information for a safety deposit box holding key crypto credentials.
The lack of cooperation from 3AC co-founders resembles the story of Do Kwon, the CEO and co-founder of Terraform Labs.
However, Do Kwon has been slightly more vocal while playing a cat-and-mouse game with South Korean authorities since the issue of his arrest warrant.
