Infringements Lead to Nine-Year Ban for Threeย Arrowsย Capitalย (3AC) Founders in Singapore
In the ever-changing world of digitalย currency regulation, governments are striving to establish order and oversight. Unfortunately, the founders of Threeย Arrowsย Capitalย (3AC), who famously fled Europe following the hedge fundโs collapse during the 2022 FTX crisis, are onceย more making headlines for the wrong reasons. This time, they have drawn the ire of Singapore.
The Centralย Bank of Singapore (MAS) has announced a lengthy nine-year ban to co-founders Zhu Su and Kyle Davies. This punishment comes becauseย ofย multiple infractions and breaches of regulatory laws within the country. The accusations include providing false information to regulators, failing to notify MAS about key personnel appointments, and lacking aย suitable management of risk framework for digital assets under their management. These infractions violate the โSecurities and Futures Act 2001โ and the โSecurities and Futures (Licensing and Conduct of Business) Regulations (SFR).โ
Consequences Beyond Legal Implications
As of September 13, 2023, Su and Davies are prohibited from engaging in regulated business activities in Singapore. They are not allowed to hold managerial or directorial positions or take part as major shareholders in financialย resources markets.
Furthermore, this ban outlines the repercussions of Su and Kyleโs engagementย in the downfall of Threeย Arrowsย Capitalย (3AC). Once a major player in the cryptocurrency market, the hedge fund crumbled after the Terraย (LUNA) Luna collapse in 2022. It inย theย end filed for bankruptcy in July of that year with a long list of creditors.
Singaporeโs Commitment to Regulatory Standards
The actions taken by MAS reflect its commitment to upholding regulatory standards in the digital landscape. This is especially wholeย lotย of considering Singaporeโs favorable stance towards digitalย currencies. In August, MAS introduced new regulations to protect legitimate enterprises and local investors. These regulations inย particularย target stablecoins in active circulation with the aim of ensuring and maintaining stability.
Assistant managing director Ms. Loo Siew Yee stated, โMAS takes a serious view of Mr. Zhuโs and Mr. Daviesโ flagrant disregard of MASโ regulatory requirements and dereliction of their directorsโ duties. MAS will take action to weed out senior managers who commit such misconduct.โ
Implications for the Cryptocurrency Industry
The nine-year ban imposed on Zhu Su and Kyle Davies goes beyond the realm of regulatory action. It has theย capacity to impact the wider cryptocurrency industry, as Singaporeโs approach to digitalย currency and digital asset regulation may influence other regions.
Hot Take: Ban on Threeย Arrowsย Capitalย (3AC) Founders in Singapore Raises Concerns for Cryptocurrency Industry
The recent nine-year ban announced to Zhu Su and Kyle Davies, co-founders of Threeย Arrowsย Capitalย (3AC), by the Centralย Bank of Singapore (MAS) has wholeย lotย of implications for the cryptocurrency industry. Not only does it highlight the consequences faced by individuals involved in fraudulent activities within the sector, but it likewise emphasizes Singaporeโs commitment to maintaining regulatory standards in the digital landscape. As a region known for its favorable stance toward digitalย currencies, Singaporeโs actions may influence other jurisdictionsโ approaches to cryptocurrency regulation. This case serves as a reminder that senior managers who engage in misconduct will face severe penalties, potentially impacting the broader industry.
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