After the bankruptcy: are the 3AC bosses on the run?
The founders of 3AC are nowhere to be found after their company went bankrupt.
The founders of 3AC are nowhere to be found after their company went bankrupt. There are currently two lawsuits against the hedge fund.
The saga around Three Arrow Capital (aka 3AC) takes a new turn. The two founders of one of the biggest hedge funds in the crypto space are nowhere to be found after the company went bankrupt, Bloomberg reports.
A week ago, 3AC officially filed for bankruptcy. Court documents show 3AC was still holding cryptocurrencies worth ten billion US dollars earlier this year. In the meantime, the company can’t pay its debts and has filed for bankruptcy. Authorities in Singapore and the U.S. are investigating the two founders, Kyle Davies and Zhu Su.
Offices deserted since May 2022
It was unclear whether the two founders attended the first hearing in Singapore. They attended via Zoom, with audio and video turned off, according to media reports. Only their lawyers answered questions from the court. The court-appointed liquidators could not enter the company’s closed offices in Singapore. Neighbors reported the offices have been deserted since late May. Reuters found a stack of old, unopened mail outside.
The liquidators fear the founders may move their remaining assets, including crypto and cash. Media outlets have already reported early signs: one founder is reportedly selling real estate. And the once $100 million Starry Nights NFT collection has, for unknown reasons, been moved to a new wallet (current value: $5 million).
3AC bled after the Terra crash
Allegations against 3AC are bolstered by the opaque web of subsidiaries. These entities are registered in tax havens like the Cayman Islands. A CoinDesk investigation shows 3AC allegedly ran its own trading desk in the Virgin Islands with Tai Ping Shan Capital (TPS). The spicy part is that TPS Capital, despite the insolvency proceedings, apparently remains active.
3AC is one of several large crypto firms that went bankrupt in the wake of the market crash. Some crypto exchanges like Celsius are still dealing with fallout. In some cases, they have paused customer withdrawals.
According to unconfirmed reports, 3AC used massive leverage. The firm allegedly invested billions in Terra. Within a week, the Terra ecosystem collapsed by about 99 percent. The founder, Do Kwon, is on trial in South Korea for fraud, among other charges.
