Zhu and Kyle Davies, the co-founders of the now-defunct crypto hedge fund Three Arrows Capital, have recently reemerged with no shortage of opinions about the collapse of Sam Bankman-Fried’s FTX. However, neither they nor their Singapore-based legal team have been cooperating with requests for documents related to their firm’s liquidation. In response, the High Court of the Republic of Singapore has ordered Three Arrows Capital and its co-founders to submit affidavits outlining their dealings with the company.
move comes after the Singapore high court officially recognized the liquidation order filed in the British Virgin Islands, which gives the court-appointed liquidator, Teneo, the ability to request Singapore financial records for the company and its co-founders. The information in the affidavits could be critical for liquidators, who have been working to locate funds and figure out how to settle claims with creditors.
Arrows took a $200 million hit when TerraUSD (UST), Terraform Lab’s algorithmic stablecoin, lost its one-to-one peg with the dollar and wiped out $40 billion in investor funds over a few days in early May. As rumors began to circulate about the embattled hedge fund, crypto exchanges BitMEX, FTX, and Deribit liquidated the firm’s positions when it couldn’t meet margin calls, or add collateral to secure the outstanding balances on its loans.
final blow came when crypto lending company Voyager Digital, itself now bankrupt, revealed Three Arrows owed it $661 million, and issued a formal notice of default. Two days later, the firm was ordered to liquidate by a court in the British Virgin Islands.
Singapore court order, submitted on Wednesday, comes a week after an attempt to obtain documents went unanswered by Solitaire, one of the Singapore-based law firms representing Three Arrows Capital, also known as 3AC. WongPartnership law firm, in a letter to Solitaire, demanded that they produce documents by November 23, claiming that their previous correspondence indicated that their client would be providing information on a rolling basis without specifying what that information would be.
Crumpler and Christopher Farmer, the 3AC foreign representatives in the firm’s bankruptcy proceedings, submitted the order to the Southern District of New York bankruptcy court docket on Thursday.
has recently appeared on CNBC, saying that he is in Bali and has been cooperating with the liquidators. He has also gone on to allege that FTX and Alameda Research, a trading firm also founded by Bankman-Fried, have colluded to trade against their clients. Zhu has been less direct, reposting allegations against FTX and Alameda on his Twitter account and speaking to a reporter in Abu Dhabi last week.
