- 3AC allegedly deceived investors about its balance sheet
- The location of Three Arrows’ co-founders Kyle Davies and Su Zhu is unknown
The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are investigating into whether now-defunct crypto hedge fund Three Arrows Capital violated the law by not registering with them and deceiving investors about its balance sheet, Bloomberg reported, citing insiders.
Three Arrows was ordered to liquidate by a court in the British Virgin Islands on June 27.
The founders pulled a Do Kwon
The location of Three Arrows’ co-founders Kyle Davies and Su Zhu is unknown. Neither their lawyers nor the liquidators in the bankruptcy case have been able to track them down.
Recently, the liquidators requested from the court to serve the two subpoenas via their Twitter accounts, email addresses, and their lawyers’ email addresses. In a similar vein, Terraform Labs founder Do Kwon disappeared and Interpol is now searching for him.
Extreme fluctuations
The hedge fund, which was based in Singapore, filed for bankruptcy in July 2022, explaining its business had been destroyed by extreme crypto market fluctuations. 3AC was hit very hard by the collapse of TerraUSD (UST) in May.
The Monetary Authority of Singapore (MAS) was the first regulator to begin eyeing them, reprimanding the fund for allegedly giving it false information.
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