The owner of a 10 billion USD crypto fund first appeared after the collapse

 3AC founders speak out after weeks of hiding over the bankruptcy of one of the world's largest crypto hedge funds.


People may say we are stupid or paranoid. I can accept that. But to say that I ran away with my money in the final stage is not true, when I put more of my own money into it," said Su Zhu, co-founder of Three Arrows Capital (3AC), on 22 /7.

3AC is considered one of the world's largest cryptocurrency investment funds, with a period of up to 10 billion USD in assets under management. However, this company filed for bankruptcy in Manhattan federal court in the US on July 1 because it could no longer pay its debts because it poured money into Luna and UST. This move directly impacted the market and caused the cryptocurrency crisis to spread further.

3AC's liquidation advisors said on July 8 that co-founders Su Zhu and Kyle Davies were not cooperating with them, nor was it clear where they were.

Zhu Su at an investment conference in 2019. Photo: Coindesk.
Zhu Su at an investment conference in 2019. Photo: Coindesk.

Zhu explained, they had to hide because their lives were threatened. "That doesn't mean we haven't contacted the relevant authorities. We maintained contact with them from the beginning," Zhu said in a phone interview with Davies and two lawyers.

The two refused to disclose their current whereabouts, but a lawyer said they will be traveling to the United Arab Emirates (UAE), a hot spot for the cryptocurrency world today. The collapse of 3AC caused many businesses and small investors to suffer billions of dollars in losses.

"This is very sad. A lot of people have lost all their money," Davies said.

Court records show Davies and Zhu are owed more than $2.8 billion, and that number could continue to grow. The liquidation specialists only control about $40 million worth of assets.

"We prepare for a market that doesn't play out in reality," Zhu said.

"We believe completely in everything, almost all of our assets are poured into it. We do our best when things are good and lose the most when things are difficult," Davies said.

The two 35-year-old co-founders of 3AC said they weren't the only ones who gambled with the market and used large loans, pointing to the collapse of a number of big names such as Celsius Network, Voyager and BlockFi.

According to court documents, Zhu and Davies lived lavish lives before going bankrupt. The two used the company's money to buy one of the most expensive yachts in Singapore with a value of 50 million USD. According to the plan, the yacht will be handed over in the next two months in Italy.

Zhu insists this is a smear campaign aimed at them. "The yacht was purchased a year ago, expected to be built and used in Europe. Its financial records are complete," said the 3AC co-founder, adding that he does not live lavishly and is always on the go. made of bicycles.

Zhu and Davies admitted to suffering heavy losses because of transactions involving Luna and TerraUSD (UST), completely surprised by the speed of the collapse of these digital currencies.

"What we didn't realize was that Luna was likely to fall to zero in just a few days, leading to a credit squeeze across the industry and putting a lot of pressure on our position," Zhu said, adding that 3AC may have gotten too close to Do Kwon, the founder of Terra.

After Luna's collapse, Zhu said crypto lenders remained comfortable with 3AC's financial situation, allowing them to continue trading "as if nothing had happened." "We were working as usual during that period. But then Bitcoin fell from $30,000 to $20,000 each, causing a lot of damage to us. This was the last drop of water," both said.

When asked about the issue that caused 3AC to collapse, Zhu said that overconfidence after years of bull markets has impacted the entire credit infrastructure in the crypto industry. "People have always understood 3AC as a venture capital company. When visiting our website, there is a clear warning about the risks associated with cryptocurrencies. We have never advertised 3AC as a company. There's no risk," he said.

He expressed hope to complete the process of liquidating private assets in an orderly manner.

"There were a lot of crazy people threatening to kill us. The best thing for all of us was that Kyle and I were kept safe and out of the spotlight. We had plans to move operations to Dubai and will come again. It's early to assess the situation. Things are constantly changing, the main goal is to support the recovery process for investors," Zhu said.

"I think I've got a plan for next year," Davies said.
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