A War of Words and a 'Much Wow' Superyacht: Bankrupt 3AC's Founders Clash with Liquidators
Crypto News

A War of Words and a 'Much Wow' Superyacht: Bankrupt 3AC's Founders Clash with Liquidators

3m
Created 1yr ago, last updated 1yr ago

Liquidators for the bankrupt crypto hedge fund say Kyle Davies and Zhu Su have repeatedly failed to engage with proceedings — but they insist this is not the case.

A War of Words and a 'Much Wow' Superyacht: Bankrupt 3AC's Founders Clash with Liquidators

Table of Contents

Listen to the CoinMarketRecap podcast on Apple Podcasts, Spotify and Google Podcasts

Retrieving the $3 billion owed to creditors following the collapse of Three Arrows Capital is much easier said than done, new court documents show.

A presentation reveals that liquidators have only made modest progress since the doomed hedge fund collapsed earlier this year.

About $35 million in fiat has been retrieved that was being held in Singaporean banks, alongside $2.8 million following the "forced redemptions of investments."

What's more, about 60 different types of cryptocurrencies have been identified and seized — but their exact value is unclear.

An especially interesting development concerns efforts to recover $30 million from the sale of a superyacht called "Much Wow" — clearly named in tribute to Doge, the memefied shiba inu that led to the creation of Dogecoin.

The presentation also criticized 3AC's founders, Kyle Davies and Zhu Su, for failing to respond to communications from liquidators — despite the fact that they've been active on Twitter, and have even given a number of high-profile media interviews.

It notes that an "extensive interview" was given to Bloomberg in July after 3AC went under — with Davies appearing on CNBC last month to discuss the hedge fund's bankruptcy proceedings, as well as the turmoil that has engulfed FTX.

So far, both men have only had two discussions with the liquidators. They were present for an introductory Zoom call in July where "their video was turned off and they remained on mute throughout." They also participated in separate teleconferences in August.

All of this has meant that the liquidators are yet to receive a complete set of records related to 3AC's finances, the presentation claimed, adding:

"A communication protocol was agreed between the liquidators and founders but has not yet yielded satisfactory cooperation. Founders have refused to accept service through their Singapore counsel. Founders appear to be in Bali, Indonesia and/or the United Arab Emirates — jurisdictions known for difficulties in enforcing foreign court orders."

3AC Co-Founder Hits Back

Kyle Davies has shot back against the liquidators — accusing them of making "extravagant allegations" against him and Zhu Su.

In a statement, they allege that liquidators have failed to engage constructively "to try to maximize returns to creditors," adding:

"Instead, it appears to us that they are intent on making threats against us, and spending a lot of time and money on continuing court proceedings in a number of jurisdictions … In our view, such time and costs should be spent engaging us in the best interests of creditors."

The statement goes on to claim that the liquidators have failed to distribute funds to creditors despite "sitting on cash and other fund assets" for months.

"We invite the liquidators to engage us positively, constructively and without threats […] we are actively pursuing setting up a roundtable discussion with creditors to talk through asset recovery and a path forward."
0 people liked this article