The founders of Three Arrows Capital (3AC) explained how their funds, the Rockstar of the market, sank a few months ago after living a life on the run for five weeks.
Three Arrows Capital founders, Su Zhu and Kyle Davies, spoke to Bloomberg about what happened without specifying their whereabouts for the first time after five weeks of absolute silence. common thought of the two reverse positions of cheap credit systematically worsening the effect a risk management it was a failure.
The duo admitted their failure but theft allegations. they refused. Zhu, “People may call us fools or dreamers but we are not thieves.” said.
The advisors responsible for the liquidation of the fund met with Zhu and Davies themselves on July 8. state that they do not cooperate had done. In the interview, Zhu stated that they are hiding because they are constantly receiving death threats, and that the fact that they are hiding does not mean they are not in contact with all relevant authorities. in touch since day one said they were.
Davies, one of the duo who lived on the run after long reigning as the managers of one of the most influential funds in the industry;
We believed in everything until the end. Almost all of our assets were there, we performed best when the market was good, but when the market reversed, we lost the most.
said.
According to the interview, he admits that the collapse of his binary funds has led to bankruptcies, distress and bailouts at firms like Celsius Network, Voyager Digital and BlockFi, but Zhu said Celsius and other firms It’s no surprise that he had this problem at the same time. expressed. He also stated that everyone has their own capital and balance sheet, they receive deposits through borrowing, but they also provide income to depositors.
In their statements, Davies and Zhu acknowledged the heavy losses from the transactions in LUNA and TerraUSD, expressing that they were shocked by the rate of collapse of these cryptocurrencies. Zhu;
We could not have predicted that LUNA would drop to zero in a few days, causing a credit crunch across the entire industry.
said.
According to the statements of the duo, the lenders did not doubt 3AC even after the LUNA crisis, and As if nothing has happened allowed them to continue their rule. According to the files that emerged during the court process, these loans many very low collaterals required. The duo stated in the interview that they are continuing to trade and are slowly starting to recover, but Bitcoin’s from 30,000 to 20,000 dollars make them fall almost completely compressed stated.
Davies and Zhu eventually found the root of the problem. a never-ending bull market and not giving enough weight to risk management in the abundance of cheap loans. Zhu has always been on their website, stating that all companies and individual investors doing business with them know what they are getting themselves into and do not hide their high-risk transactions from their investors. there is a risk notice expressed.
While Zhu hopes for the successful completion of the purge, the duo, who plans to get away from the angry crowd, find themselves at ease after this stage. physically securing and keeping a low profile aims.