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Three Arrows Capital (3AC) Escape Co-founders SuZhu and Kyle Davies have emerged to share their side of the story related to the collapse of 3AC. However, they remained innocent about rumors about giving up investors’ money.
In an exclusive interview with BloombergDuo cited high leverage bets, the collapse of the Terra ecosystem, and the holding of the Grayscale Bitcoin Trust (GBTC) as catalysts for the collapse of hedge funds.
The founder admitted that he made a risky leveraged bet on the investment. Cryptographic winter. Their overconfidence put the fund in a market that didn’t work as planned.
Davis commented:
“We believed everything to the fullest. We had all the assets, almost all the assets there. And at good times we did our best. And At bad times, we lost the most. “
He added:
“The whole situation is disappointing and many people have lost a lot of money.”
Terra’s huge Collapse It was a 3AC deal breaker. Not only did they lose a large LUNA position, but the resulting credit crunch across the crypto market has further plunged hedge funds into a spiral of death.
3AC held a big position in Staked ETH (StETH), suffered from leverage hunting. As the price of the crypto market fell as the terra ecosystem collapsed, many traders took advantage of the opportunity to oppose stETH, which resulted in it falling below the price of ETH.
To keep the deal going, 3AC continued to borrow from large digital asset lenders and investors until the situation went out of control.
Reflecting the incidence, Zhu said:
“What we didn’t realize was that Luna could fall to virtually zero within a few days, which catalyzed the industry-wide credit crunch and put great pressure on all our illiquid positions. Was to call. “
As 3AC Collapse, Hedge funds have reduced payments to creditors from managing over $ 10 billion in assets $ 3.5 billion Over 32 companies.
The damaged creditors Submission To secure the assets of Singapore hedge funds. If this is approved, a portion of the funds can be recovered from the clearing income.
Zhu and Davies said they are working with relevant authorities to support the creditor recovery process.
Continue to before Report To move 3AC’s headquarters from Singapore to Dubai, the struggling founders are trying to find safety in Emirates.
Aiming to make Dubai a global crypto hub, Zhu and Davis believe they can prepare their lives from the following locations in Dubai: The move is to move away from the threat of death chasing them from the affected investors.
“For Kyle and I, there were so many crazy people in cryptocurrencies that caused threats of murder and this kind of turmoil,” Zhu said. “We feel that if we can be physically safe and unobtrusive, it will benefit everyone.”
