Three Arrows Capital liquidators are seeking to recover $1.3 billion from the co-founders of the failed crypto hedge fund, Su Zhu and Kyle Davies.
The liquidators discussed the allegations against Zhu and Davies at a Tuesday meeting with the hedge fund’s creditors. According to a person familiar with the liquidators' claims, Zhu and Davies are accused of causing Three Arrows to take on significant leverage between May and June 2022 after the hedge fund suffered big losses on ill-fated Luna tokens and other investments.
The liquidators’ allegations against the co-founders escalate actions they’ve taken against Zhu and Davies, whom they’ve accused of not meaningfully cooperating with their investigation. The liquidators, partners at the consulting and advisory firm Teneo, were appointed by a BVI court last year and are attempting to recover funds for Three Arrows creditors who are owed roughly $3.3 billion.
Earlier this month, liquidators urged a New York bankruptcy judge to fine Davies $10,000 per day, saying in a court filing that a substantial fine is warranted because he hasn’t responded to a subpoena seeking business records and other information. The liquidators have said they don’t know where Davies or Zhu are currently residing but in court papers earlier this month referenced a New York Times article that reported Davies flew to Bali after Three Arrows collapsed.
As reported earlier, Su Zhu and Kyle Davies are launching a new cryptocurrency exchange, OPNX, and issuing tokens for the exchange.
TokenInsight is dedicated to covering the most important and cutting-edge trends in the world of crypto. If you have information to share with us, please feel free to contact our email news@tokeninsight.com. Your trust will be well respected.
Three Arrows Capital
