Zhu Su, co-founder of the now-bankrupt Three Arrows Capital (3AC), has been apprehended in Singapore, in keeping with a tweet by on-line information aggregator db, referred to as @tier10k on X, who attributed the information to a press release from Bloomberg.
db later reported that Zhu had been sentenced to 4 months jail time by a Singaporean courtroom for undisclosed causes. At press time, not a lot is thought in regards to the motive behind the arrest or the character of expenses introduced, if any.
3AC’s downfall was a stunning occasion within the crypto business, given its outstanding place and substantial funding stakes in initiatives reminiscent of LUNA, Aave, Avalanche, BlockFi, Deribit, and Solana. The corporate’s lack of a strong danger administration framework, coupled with reckless dealings and a big diploma of greed, set the stage for its collapse, in keeping with an evaluation by CryptoSlate.
The chain response resulting in 3AC’s collapse was set off when LUNA, a significant funding of the agency, skilled a crash in Might. Regardless of managing roughly $18 billion in crypto property at its peak, 3AC failed to fulfill its margin calls in June, resulting in hypothesis in regards to the agency’s monetary standing. Subsequently, the failure to repay borrowed cash from crypto dealer Voyager Digital, totaling $665 million, led to additional destabilisation within the business.
The Financial Authority of Singapore (MAS) performed an instrumental function in bringing gentle to the agency’s murky dealings. In September, MAS issued a nine-year prohibition order towards 3AC founders Zhu Su and Kyle Davies. MAS’s investigation revealed that 3AC had failed to tell the regulator in regards to the appointment of Cheong Jun Yoong Arthur as its portfolio supervisor and had misrepresented his employment standing. These actions, along with an insufficient danger administration framework, had been attributed to the failures of Zhu and Davies in fulfilling their duties.
3AC’s collapse had far-reaching results, impacting not simply its stakeholders but additionally different corporations within the business. Voyager Digital was compelled to file for chapter because of the lack of reimbursement from 3AC. The cascade of occasions led to damages totaling greater than $3 billion, affecting 27 corporations in complete.
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