Key Takeaways
- Three Arrows Capital Liquidators have also recovered $2.8 million from forced redemptions of investments.
- $35.6 Million currently seized is the largest amount of money obtained since 3AC collapsed in late June.
Three Arrows Capital(3AC) liquidator Teneo has seized $35.6 million from the bankrupt crypto hedge fund’s bank accounts in Singapore. This comes nearly five months after 3AC filed for bankruptcy in the British Virgin Islands in late June after being hammered by a sharp sell-off in virtual assets.
As per reports, the $35.6 Million currently seized is the largest amount of money obtained since 3AC collapsed in late June. Reportedly, Three Arrows Capital Liquidators have also recovered $2.8 million from forced redemptions of investments and an unspecified number of crypto tokens/NFTs.
According to the liquidators’ court filing, Singapore-based 3AC, which was reported to have $10 billion in cryptocurrency earlier in 2022, held $3 billion in assets as of April. Apart from Singapore Authorities,3AC is also probed by the US Securities and Exchange Commission (SEC) as well as the Commodity Futures Trading Commission, which are looking into whether the hedge fund misled investors about its balance sheet and further failed to register with the required agencies.
As per liquidators’ statements,3AC founders- Zhu and Davies have been uncooperative throughout the liquidation process. Reportedly, liquidators have had only very limited communication with Su, Davies, and their lawyers. Liquidators also state that at the beginning in mid-June, the 3AC founder duo “engaged security experts … to, among other things, establish secure communications between designated individuals that could be deleted.”
Frustrated at the founder’s noncooperation, Teneo had earlier resorted to asking the court to subpoena Zhu and Davies through “alternative methods” by sending requests to their Twitter accounts and email addresses. The liquidator also claimed that the 3AC founder duo “repeatedly failed to engage” with them—including a Zoom call where they kept their video off and microphones muted throughout the entirety of the meeting.
The fall of 3AC can be traced to the collapse in May of terraUSD (UST), Terraform Lab’s algorithmic stablecoin. 3AC invested more than $200 million in Luna (LUNA-USD) tokens in February 2022. The final blow to 3AC came when now-bankrupt crypto lending company Voyager Digital stated that 3AC owed it approximately $661 million and issued a formal notice of default triggering the crypto hedge fund to file for bankruptcy.
