Su Zhu, Co-Founder of Three Arrows Capital, Arrested in Singapore
Su Zhu, the co-founder of the now-defunct crypto hedge fund Three Arrows Capital (3AC), has been arrested by authorities in Singapore while attempting to leave the country. Teneo, the joint liquidators of 3AC, confirmed this news in a statement shared with Decrypt.
Zhu was apprehended at Changi Airport following a committal order by the Singapore courts. He will serve a four-month prison sentence. Meanwhile, his fellow co-founder, Kyle Davies, is also due for four months behind bars, but his whereabouts are currently unknown.
Refusal to Comply with Court Order
Teneo filed and obtained a committal order against Zhu on Monday after he refused to comply with a court order to account for his activities as 3AC’s founder and investment manager.
Reasons Behind 3AC’s Collapse
3AC collapsed in June 2022 due to overexposure to the algorithmic stablecoin protocol Terra, which experienced an inflationary death spiral. Zhu and Davies admitted their close connection to Terra co-founder Do Kwon, who was arrested earlier this year.
New Exchange Launch and Death Threats
Zhu and Davies went underground after 3AC’s collapse, citing death threats. During this time, they launched OPNX, a new exchange for traders to exchange bankruptcy claims for other fallen crypto companies such as FTX.
Asset Recovery and Compliance
While Zhu is imprisoned, Teneo plans to press him for more information about 3AC to aid in asset recovery and ensure compliance with the court order. The Monetary Authority of Singapore has already barred both Zhu and Davies from engaging in regulated investment activity for nine years each.
Hot Take: Continued Crackdown on Crypto Figures
The arrest of Su Zhu highlights the ongoing crackdown on crypto industry figures involved in fraudulent activities or non-compliance with legal orders. Authorities are prioritizing the protection of investors and the integrity of the financial system. This incident serves as a reminder that regulatory oversight is becoming increasingly stringent, and individuals who fail to comply with legal requirements will face severe consequences.
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