3AC Liquidators Seek Contempt Sanctions for Co-Founder Kyle Davies
• Three Arrows Capital (3AC) co-founder Kyle Davies is facing potential contempt of court charges due to his failure to respond to a subpoena.
• The estate of the collapsed hedge fund has requested the court to impose a daily fine of $10,000 on Davies.
• Co-founders Kyle Davies and Su Zhu recently finalized a funding round for their OPNX exchange and are moving forward with plans to acquire the remaining assets of CoinFLEX.
Three Arrows Capital’s Collapse
The Singaporean crypto hedge fund Three Arrows Capital (3AC) filed for bankruptcy in July 2022, citing “extreme fluctuations in cryptocurrency markets” as the cause behind its collapse. Prior to this, 3AC had posted major losses from the collapse of TerraUSD stablecoin in May 2022.
Court Order Ignored By Davies
Last March, Judge Martin Glenn had ordered 3AC co-founder Kyle Davies to comply with a subpoena by April 13 but he failed to do so or even respond in any way. The estate of the collapsed hedge fund has now requested the court to impose a daily fine on him for contempt of court and intentional disregard of prior requests. Documents also highlighted his extravagant lifestyle and profits accumulated from managing the bankrupt business.
OPNX Exchange Launch
Despite all this, Kyle Davies and Su Zhu who also co-founded 3AC have moved on and recently finalized a funding round for their OPNX exchange. They have also advanced plans to acquire the remaining assets of CoinFLEX after reportedly raising $25 million in investments though details about these investors remain undisclosed.
Subpoena Requested Information About Bankruptcy Proceeding
The Joint Liquidators appointed by court made numerous documents related to 3AC available on Twitter which include a subpoena dated January 5, 2023 that requests production of documents, information, or objects along with permission to inspect 3AC’s premises in connection with its bankruptcy proceedings.
Sanctions Requested For Contempt Of Court
These proceedings have led up until now where sanctions are being requested against Kyle Davies for contempt of court due his failure to respond despite multiple orders from Judge Martin Glenn requiring him do so by April 13th last year.