Co-founders of bankrupt crypto hedge fund Three Arrows Capital (3AC) plan to donate their future earnings from their new venture to creditors who lost money after 3AC went bankrupt last year.
Key Points:
- Co-founders of 3AC, Kyle Davis and Su Zhu, pledge to donate potential earnings from their new venture, Open Exchange (OPNX), to creditors of the bankrupt hedge fund.
- The donation plan is separate from the ongoing liquidation proceedings and is considered a “shadow recovery process.”
- Global consulting firm Teneo is managing the recovery process for 3AC.
- Davis believes it is a way to provide good karma and allow creditors to potentially recover some of their losses.
- Some creditors of 3AC have already been made whole through the liquidation process.
- The crypto community is critical of the co-founders’ decision and believes they should focus on the court-ordered activities of the liquidation process.
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The co-founders of Three Arrows Capital’s decision to donate their future earnings to creditors is a controversial move. While it may be seen as a gesture of goodwill, it also raises questions about their responsibilities during the liquidation process. The crypto community’s reaction suggests that they believe the co-founders should prioritize assisting with the ongoing recovery efforts rather than focusing on a new venture. It remains to be seen how this “shadow recovery process” will unfold and if it will be accepted by all creditors.
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