Founders of Singapore-based bankrupt crypto hedge fund Three Arrows Capital (3AC) have been accused of having more social media screen time instead of relating with its creditors about the liquidation.
Markedly, the legal team in charge of the liquidation said that 3AC’s Kyle Davies and Su Zhu have refused to cooperate with efforts made toward asset recovery, thereby, obstructing the hedge fund from repaying its creditors.
According to Adam Goldberg, who works with Latham and Watkins and is equally the chief lead of the 3AC liquidation legal team, Davies and Zhu are more concerned about their reputation. Since the implosion of the FTX Derivatives Exchange, Davies has not failed to talk about how the collapse of 3AC is the fault of others (speaking about FTX) but itself.
FTX Hunted Our Position, Says 3AC
In an interview held last month, Davies claimed that FTX and its sister trading firm Alameda Research ‘hunted our positions’, contributed to the collapse of the Terra/Luna by crashing the price of the cryptocurrency, and ‘took us down. However, attorney Goldberg was not having any of it.
“Since the collapse of FTX, Mr. Davies has appeared on CNBC and both of the founders have been very active on Twitter, calling out FTX and advancing the theory that FTX caused the debtors’ collapse. It’s interesting to say the least, that the first time we’ve heard this theory that FTX caused the downfall of this debtor was after FTX’s own sensational collapse,” Goldberg stated
Apart from refusing to make out enough time to discuss with creditors, the co-founders have taken on a new hobby of traveling from one location to another, from Bali to the United Arab Emirates. Currently, nothing is known about the real location of both Davies and Zhu. However, it is suspected that they are in jurisdictions that do not cooperate with international court orders.
Goldberg mentioned that many strategies have been employed in trying to get the hedge fund founders to comply with the court bankruptcy proceedings. A clear example of such strategies is an extension of suggesting alternative means to subpoena Davies and Zhu