Court Order Freezes $1 Billion In Assets Belonging to 3AC Founders

A court in the British Virgin Islands has issued an order to freeze assets totaling approximately $1 billion, owned by the founders of cryptocurrency hedge fund Three Arrows Capital (3AC). The fund’s liquidator Teneo has confirmed this development with Bloomberg.

3Ac Founders Can’t Move Their Assets

The court has issued an order restraining co-founders Su Zhu and Kyle Davies, along with Davies’ wife Kelly Chen, from transferring or selling assets valued at up to $1.14 billion, as stated in an email from liquidator Teneo. The liquidator estimates that creditors are owed approximately $3.3 billion. Teneo said:

“The worldwide freezing order has been sought in connection with claims that are being pursued by the liquidators that allege, amongst other things, that the founders should be held responsible for causing 3AC’s position to deteriorate by an amount that is equivalent to the value of the freezing orders sought”.

The revelation follows a domestic freezing order issued by the Singapore Court, as stated by Teneo. This development comes one day after Su Zhu’s arrest in September at Singapore’s Changi Airport while attempting to depart the country. Singapore has imposed a ban on Su Zhu and Kyle Davies, prohibiting them from engaging in any regulated activity within the country.

The Fall of Three Arrows Capital

In a stark turn of events, Three Arrows, once a prominent player in the cryptocurrency hedge fund landscape, faced a tumultuous downfall in 2022 following a series of ill-fated investments. The demise of Three Arrows (#AC) unfolded amidst a broader cryptocurrency market downturn and a wave of collapses within the sector.

The 3AC hedge fund, which had previously operated from Singapore, sought refuge in bankruptcy proceedings in the British Virgin Islands. Teneo, appointed as the liquidator by a British Virgin Islands court, has raised allegations of non-cooperation against the founders, Su Zhu and Kyle Davies.

Su Zhu and Kyle Davies, once celebrated figures during the bullish phase of the cryptocurrency market, now find their reputations and fortunes diminished in the wake of revelations about risky practices. Last week, the Singapore court conducted a questioning for Su Zhu with talks about his potential release on the radar.