British Virgin Islands Court Freezes $1 Billion in Assets of 3AC Founders
A court in the British Virgin Islands has issued a freezing order on approximately $1 billion in assets belonging to the founders of Three Arrows Capital (3AC), a cryptocurrency hedge fund. The order aims to prevent the co-founders, Su Zhu and Kyle Davies, along with Davies’ wife Kelly Chen, from transferring or disposing of assets up to $1.14 billion in order to protect the interests of creditors owed $3.3 billion.
Teneo Accuses Founders of Contributing to $3.3 Billion Debt
The liquidator Teneo, appointed by the British Virgin Islands court, has accused the founders of making decisions that led to 3AC’s downfall and substantial financial losses. Teneo is actively pursuing claims against the founders and estimates that creditors are owed $3.3 billion. The freezing order is connected to claims that the founders should be held accountable for their role in increasing 3AC’s financial troubles.
Legal Challenges Mount for 3AC Founders
This freezing order is the latest legal setback for the 3AC founders. It comes after a domestic freezing order issued by the Singapore Court, and Su Zhu was also arrested in Singapore under charges related to the hedge fund’s collapse. Both Zhu and Davies have been barred from engaging in regulated financial activities in Singapore. Three Arrows Capital filed for bankruptcy in the British Virgin Islands after its operations primarily based in Singapore failed.
Hot Take: Crypto Industry Faces Consequences for Risky Financial Practices
The case of Three Arrows Capital highlights the challenges facing the crypto industry as prominent figures who thrived during the bull run now face severe consequences due to risky financial practices. Sam Bankman-Fried, founder of FTX Trading Ltd., is another example, as he was recently convicted of fraud. These cases serve as a reminder that sound financial practices and compliance are crucial for the long-term success and stability of the crypto industry.
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