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Tuesday, May 28, 2024

Kyle Davies Says He Is Unapologetic About the Collapse of Three Arrows Capital (3AC)

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Kyle Davies, the co-founder of the defunct cryptocurrency hedge fund Three Arrows Capital (3AC), says he is not sorry that his company collapsed in 2022 and lost billions of investors’ funds in the process.

Davies expressed his lack of remorse during an interview with Laura Shin on a March 19 episode of the Unchained Podcast, stating that he intends to avoid jail time in any way possible.

Kyle Davies is Not Sorry

Recall that Three Arrows collapsed in mid-2022 amid the crypto market downturn due to heavy losses incurred from its positions. After a British Virgin Islands court ordered the liquidation of the assets, 3AC’s liquidator, Teneo, revealed the firm owed its creditors about $3.3 billion.

Since then, Davies and his partner, Zhu Su, have been in hiding. They launched and closed the bankruptcy claims trading platform Open Exchange (OPNX) and ventured into other crypto businesses. Although Su was eventually arrested in Singapore in September 2023, Davies has remained at large. The duo based 3AC’s operations in Singapore but filed for bankruptcy in the British Virgin Islands.

Davies claimed he is currently in Europe and would not return to Singapore immediately to avoid serving a four-month prison sentence as Su did. He said he would avoid the Asian country until he settles with appropriate authorities on charges concerning the collapse of 3AC. While at it, he feels no remorse for the unfortunate incidents that befell the hedge fund.

“Am I sorry for a company going bankrupt? No. Like, companies go bankrupt all the time. Every company goes bankrupt. It’s what you do about it and how you build,” Davies stated.

Teneo’s Claims Are Exaggerated: Davies

Interestingly, Davies believes his reputation is still intact regardless of the backlash he has received on social media. He said most complaints were from individuals and entities, including FTX founder Sam Bankman-Fried and Digital Currency Group, who were unaffected by 3AC’s collapse. He claimed the successful launch of OPNX is proof that he is still well-respected.

The 3AC co-founder also insisted that Teneo’s allegations that he and Su were uncooperative in the hedge fund’s bankruptcy proceedings were exaggerated as they frequently participated in meetings geared toward liquidating the firm’s assets.

“It’s a liquidator’s job to say that the founders are not cooperative…They are trying to maximize value for the estate,” Davies explained.

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