Singapore High Court Rejects Three Arrows Capital’s Motion to Dismiss DeFiance Capital Lawsuit
The Singapore High Court has made a significant decision in the legal battle between Three Arrows Capital (3AC) and DeFiance Capital. The court has rejected 3AC’s motion to dismiss a lawsuit filed by Arthur Cheong, founder of DeFiance Capital, asserting that investors of DeFiance Capital are the rightful owners of assets held in trust by 3AC. This ruling sheds light on the complexities of asset ownership and trust in the crypto space.
Origins of the Dispute
The dispute began when 3AC relocated its headquarters to Dubai, leading to the incorporation of DeFiance Capital as separate entities in Singapore. The disagreement centers on the alleged failure to transfer certain assets to DeFiance Capital as agreed upon. The court’s decision recognizes a trust over the crypto assets and establishes Singapore’s jurisdiction for the case.
Fallout from 3AC’s Investment Strategy
Three Arrows Capital faced financial difficulties due to its investments in Terra, staked Ethereum, and Grayscale’s Bitcoin Trust, ultimately leading to bankruptcy. DeFiance Capital, on the other hand, focuses on decentralized finance and GameFi. Allegations have surfaced that 3AC and DeFiance Capital operated as a single entity. The ongoing debate in this case revolves around substance versus form.
Hot Take: Implications for DeFiance Capital
The Singapore High Court’s recognition of the trust over the crypto assets is seen as a positive development for DeFiance Capital. This acknowledgment provides “much-needed vindication” for Arthur Cheong and strengthens DeFiance Capital’s position in reclaiming assets still under 3AC’s control.
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