The founders of cryptocurrency hedge fund Three Arrows Capital Ltd. would have disappeared and are not cooperating in the liquidation of the company.
Three Arrows Capital was ordered into liquidation by a court in the British Virgin Islands on June 27 after creditors sued the company over its default amid the ongoing crypto winter. On July 9, the company filed for Chapter 15 bankruptcy protection, a form of bankruptcy that allows for cooperation between U.S. courts and foreign courts when foreign bankruptcy proceedings affect U.S. financial interests.
The whereabouts of Three Arrows founders Zhu Su and Kyle Davies, who launched the company in 2012, have been listed as ‘currently unknown’ in documents filed ahead of a hearing scheduled today to discuss next steps in the process. of liquidation. CNBC reported today that the documents also allege that the founders did not begin to cooperate with the liquidation process “in a meaningful way”.
While Su and Davies’ physical whereabouts remain unknown, they haven’t completely disappeared either.
According CoinDesk, attorneys said people identifying themselves as “Su Zhu” and “Kyle” were present during an initial Zoom call. However, their video and audio were muted and they would not respond to questions posed to them directly, with only their legal representatives responding to questions.
Zhu has since returned to Twitter, posting screenshots of an email sent by his legal counsel to the liquidators. He alleges that the liquidators “encouraged” him and Davies to provide evidence for court filings and ignored efforts to work with them in good faith.
Unfortunately, our good faith in cooperating with the liquidators was met with bait. I hope they acted in good faith with StarkWare token warrants. pic.twitter.com/CF73xI8r6n
— Zhu Su 🔺 (@zhusu) July 12, 2022
The correspondence also alleges that Three Arrows did not receive copies of court documents and that the fund provided the details requested by the liquidators. Zhu also argues that the liquidator failed to exercise a token mandate that expired on July 5, resulting in the loss of Starkware tokens.
Trouble with Three Arrows Capita emerged in mid-June with a report suggesting it was facing insolvency after suffering nearly $400 million in liquidations from lenders. The company’s investments, which included Ethereum, Solana, and Luna, fell along with the broader market, putting pressure on the company and ultimately leading to its liquidation.