3AC creditors frustrated with bankruptcy proceedings
January 11, 2023 at 9:47 pm by Ogwu Osaemezu Emmanuel
The bankruptcy case involving the collapsed crypto hedge fund, Three Arrows Capital (3AC) continues to unfold; co-founder Kyle Davis claims that the company's creditors are 'frustrated' with how the process is developing, citing high legal costs, among others, as reasons for the deadlock.
Kyle Davis says creditors are creating delays
Kyle Davies, the co-founder of bankrupt hedge fund Three Arrows Capital (3AC), revealed in a series of Tweets that the company had formed a creditors committee to tackle some of the issues regarding the firm's bankruptcy process.
According to Davis, the creditors are frustrated with how the situation is developing, citing increasing legal costs as one of the primary reasons for the perceived roadblock in the process.
Additionally, he noted that the group believes that assets are not being adequately managed, and the estate value is not being 'maximised.'
"We believe the best way forward is to reduce the ongoing legal costs, pursue claims on a contingency basis against Luna consortium/FTX/Genesis, and organise better ways to deal with asset sales/distributions."
Kyle Davies, Co-founder Three Arrows Capital (3AC),
Some of the essential topics of discussion in the meeting are proposed plans to pursue claims against some of its debtors, including Do Kwon's Luna, Sam Bankman-Fried's FTX and Genesis, and better organization of asset sales. Davis said that the meetings would become regular and encouraged all creditors to join the committee.
Today we held an ad hoc 3AC creditor meeting. All creditors are open to join and this will be a regular meeting.
Here is an overview of the points discussed:
It's been a tumultuous period for the Singapore-based fund since it filed for Chapter 11 bankruptcy in July 2022. The whereabouts of both founders became a subject of controversies as reports emerged that both men had vanished, which inevitably stalled the asset recovery process the company's liquidators had initiated.
In a new development on Jan.5, The United States Bankruptcy Court in the Southern District of New York subpoenaed Davies to produce documents enabling access to 3AC's assets. The attorneys representing the liquidators then proceeded to tag the 35-year-old in a tweet containing a redacted copy of the subpoena.
Ogwu Osaemezu Emmanuel
Ogwu Osaemezu Emmanuel is a graduate of Mass Communication and Media Studies. He joined the blockchain movement in 2016 when a friend of his introduced him to an investment platform accepting bitcoin. He has never looked back since then. Emmanuel believes the world needs real change and freedom from poverty. He sees crypto and the underlying distributed ledger technology as the catalyst to a better future for all.