Recent reports have confirmed the arrest of Su Zhu, co-founder of the now-defunct crypto hedge fund Three Arrows Capital (3AC), in Singapore. His detention came as a result of his refusal to comply with a Singapore court’s directive to participate in the liquidation investigation. Consequently, Zhu faces a four-month incarceration. 3AC, once a beacon during the 2020-2021 crypto boom, eventually met its downfall like many of its contemporaries.
Crypto’s Fallen Giants
In its heyday, Three Arrows Capital (3AC) stood tall alongside other crypto giants like Terra-Luna, FTX, Celsius, and Voyager. However, all these entities have now crumbled and are facing legal proceedings.
At its zenith, 3AC boasted of managing assets valued at a staggering $10 billion. However, the fund filed for bankruptcy in July 2022, shortly after the crypto realm was rocked by the implosion of the Terra-Luna ecosystem. The debt owed to its creditors was a whopping $3.5 billion.
A Superyacht And Luxury Real Estate
The dynamic duo behind 3AC, Su Zhu and his co-founder Kyle Davies, were celebrated as visionary crypto investors known for their audacious and optimistic forecasts. During 3AC‘s golden period, propelled by Bitcoin’s meteoric rise in 2021, the pair even commissioned a luxury superyacht whimsically named “Much Wow.”
The yacht’s registered ownership company, Much Wow Ltd, failed to make final payments, the liquidators revealed in a bankruptcy-court hearing. Because of non-payment, the 171-foot (52-meter) went up for sale.
EdgeProp reports indicate that between 2019 and 2021, Zhu made significant real estate acquisitions in Singapore, both personally and under his wife, Tao Yaqiong‘s name, amounting to $83.55 million.
From a staggering net worth of over S$1 billion, Zhu’s financial trajectory has seen a dramatic decline, culminating in his recent apprehension.
While Zhu’s arrest has been confirmed, the Singaporean authorities are still on the lookout for Davies, whose current location remains a mystery.
The Elusive Founders
Teneo, overseeing the liquidation process of the collapsed hedge fund, has repeatedly voiced its grievances over Zhu and Davies’ uncooperative stance. Their attempts to serve subpoenas even extended to digital platforms. Recent revelations indicate Teneo’s intent to reclaim $1.3 billion from the founders, holding them accountable for the fund’s substantial losses.
The Monetary Authority of Singapore (MAS) censured 3AC for disseminating misleading data and breaching fund management licensing regulations.