3AC liquidators demanded $1.3 billion from the founders

Zhu & Davies
Zhu & Davies

The liquidators of Three Arrows Capital (3AC) sued hedge fund co-founders Su Zhu and Kyle Davis demanding the return of $ 1.3 billion, which the latter allegedly raised shortly before the collapse of the hedge fund, writes The Block.

The specified value is included in the total amount of claims on the firm in the amount of $3.3 billion.

The liquidators discussed the allegations against the 3AC co-founders at a meeting with the hedge fund’s creditors, according to the publication’s sources.

The document states that Zhu and Davis increased their leverage from May to June 2022 after the hedge fund suffered heavy losses due to investments in LUNA tokens. According to the liquidators, the company was already insolvent at that time.

The current allegations increase the amount of claims against Zhu and Davis. Earlier, the liquidators noted the lack of cooperation of the co-founders in the investigation.

In June 2022, a court in the Virgin Islands ordered the liquidation of Three Arrows Capital. In July, the company filed for bankruptcy protection in the US.

In December, 3AC liquidators recovered $35.6 million belonging to the cryptocurrency hedge fund from banks in Singapore, and also filed a petition to sell a $30 million superyacht.

That same month, the court approved subpoenas for Zhu and Davis.

Recall that in April 2023, the co-founders of 3AC launched the OPNX cryptocurrency exchange.

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