According to a filing by advisory firm Teneo, which is anticipated to liquidate the remaining assets of the troubled cryptocurrency hedge fund, Three Arrows Capital’s founders are nowhere to be found.
Due to a severe selloff in digital currencies at the end of June, Three Arrows filed for Chapter 15 bankruptcy in the British Virgin Islands.
The purpose of the action was to protect foreign companies’ assets from US creditors. Kyle Davies and Zhu Su’s co-founded company, Three Arrows, declared bankruptcy after defaulting on a $670 million loan from cryptocurrency broker Voyager Digital, which has since also filed for bankruptcy.
According to a court document filed by the liquidators, Three Arrows had $10 billion in cryptocurrencies at the beginning of the year and $3 billion in assets as of the end of April.
Office for Three Arrows is closed.
Recent visits to the company’s Singapore office by court-appointed liquidators revealed that they were unable to enter because the door was locked.
According to neighbors, no one had visited the offices since late May or early June, the court petition claims. There was also, according to a Reuters report, a stack of outdated mail by the entrance.
Attorneys for the creditors claimed in court documents filed late on Friday that the founders of 3AC “have not yet commenced cooperating with the proceeding in any meaningful way.”
The lawyers noted that during the first Zoom meeting, people who identified themselves as “Kyle” and “Su Zhu” were present, but their video and audio were disabled, and they wouldn’t respond to questions directly. Only their lawyers responded to inquiries on their behalf.
‘Imminent Risk’ Of Transferring Cash & Assets
There are increasing worries that the assets of Three Arrows, which primarily consist of cash, cryptocurrencies, and NFTs, could be easily moved.
A British Virgin Islands court appointed Christopher Farmer and Russell Crumpler as 3AC liquidators, and they claim that there is a “imminent risk” that Zhu and Davies will try to move the company’s remaining funds abroad.
According to Fortune’s report, Three Arrows’ Starry Night NFTs have already been transferred to a different wallet for unidentified reasons.
According to Reuters, who cited the court document, Zhu is reportedly trying to sell a Singapore property worth millions of dollars.
The collapse of significant cryptocurrency businesses like Three Arrows has wreaked havoc on the industry as a whole.
Due to the erratic market, Celcius and Babel Finance both froze transactions in response to a severe “crypto winter.”
A court hearing in New York has been scheduled for Tuesday morning.
