Recently, Singapore’s Changi Airport became the backdrop for the arrest of Su Zhu, co-founder of the formerly successful Three Arrows Capital (3AC). The Singapore Courts had issued an order against Zhu, leading to his detainment as he tried to leave the nation.
What Led to the Arrest?
For those unfamiliar with the term, a committal order is a legal directive used to imprison an individual for court contempt. In this case, the order was granted on September 25th, with the claim that Zhu failed to adhere to a previous court directive.
The Backstory
- The Downfall: In 2022, 3AC, a hedge fund with an impressive valuation of $10 billion, faced a significant setback due to the Terra ecosystem’s unexpected crash.
- The Gamble: 3AC boldly leveraged long positions in select cryptocurrencies, borrowing substantial amounts, even in the hundreds of millions, from a cryptocurrency lending platform.
- The Outcome: After the fund’s decline, both Zhu and his co-founder, Kyle Davies, managed to elude liquidators, yet their activity on social media platforms continued unabated.
“The inquiry is centered around the recovery of funds for 3AC’s creditors,” says a representative from Teneo, the co-administrator of the currently insolvent investment fund.
What’s Next for Zhu?
The Singaporean court’s decision mandates a four-month imprisonment for Zhu. Interestingly, Kyle Davies, Zhu’s counterpart, faces a similar fate, as confirmed by Teneo.
