The Unraveling of Three Arrows Capital
From a titan in the crypto hedge fund space to facing the slammer, Su Zhu’s journey exemplifies how quickly fortunes can change in digital finance. Once a proud co-founder of the $10 billion hedge fund, Three Arrows Capital is now synonymous with financial collapse, primarily due to its reckless leverage on cryptocurrencies and a particular affinity for risky investments.
Su Zhu’s Arrest at Changi Airport
Things took a dramatic turn when Zhu attempted to leave Singapore and was apprehended at Changi Airport. Talk about an unexpected layover! According to Teneo, the joint liquidator for 3AC, he was stopped due to a court-issued committal order stemming from his failure to comply with legal directives pertaining to the hedge fund’s bankruptcy proceedings.
What is a Committal Order Anyway?
For those of you wondering what in the world a committal order is, it’s essentially a legal slap on the wrist that sends one off to the clink for contempt of court. Zhu now faces four months behind bars, and not for the fun of it. His imprisonment aims to force him to engage with liquidators trying to trace and recover funds for creditors left in the lurch.
The Search for Answers
During his stay in prison, Teneo plans to engage Zhu to assist in recovering 3AC’s assets, or at the very least, figure out where it all went wrong. Zhu and his co-founder Kyle Davies, who has magically alluded authorities, need to provide information about the funds and investments mismanaged during their helm of the hedge fund. Talk about a long weekend!
What’s Next for Davies?
While one half of the duo faces reality, Davies remains on the run. How does it feel to be the ‘missing’ co-founder of one of the biggest crypto collapses? The Monetary Authority of Singapore certainly has their eyes peeled, as they’ve prohibited both Zhu and Davies from participating in regulated investment activities for the next nine years. Can you imagine sitting out the crypto boom from the sidelines? It’s enough to make you rethink your career choices.
