- Brazen Kyle Davis refuses to apologize for losing investors' billions in cash
- He has been on the run since his hedge fund 3AC collapsed in mid-2022.
- His business partner Su Zhu was sentenced to three months in prison last year.
The brazen co-founder of bankrupt cryptocurrency hedge fund 3AC said he was “not sorry” the company lost billions of dollars in investor cash.
Kyle Davis and his business partner Hsu Zhu are facing more than $3.5 billion in claims from creditors after their once successful fund collapsed during the 2022 crypto bust.
Chu was arrested and sentenced to three months in prison for failing to coordinate with the liquidators, but Davis managed to avoid the same fate by remaining on the run.
Davis declined to reveal his whereabouts on the Unchained podcast this week, but grinned when asked if he had any regrets about losing billions in investor money. .
“Is it a shame when a company goes bankrupt?” No, just like companies go bankrupt, almost all companies go bankrupt, right? He said.
Davis and Chu founded 3AC (Three Arrows Capital) in 2012, raising billions of dollars from investors as cryptocurrencies soared.
At its peak, the fund managed around $18 billion, but suffered significant losses due to the collapse of cryptocurrencies LUNA and Terra.
The founders defaulted on loans after their hedge fund collapsed, in part due to borrowing from more than 20 financial institutions, according to Capital.com.
Court orders in the British Virgin Islands, and later in Singapore and the United States, are struggling to keep Mr. Davis under control as investors seek billions of dollars back.
In September 2023, Mr Chew was arrested for contempt of court at Singapore's Changi Airport for failing to comply with a liquidator's order, but Mr Davies said in a podcast appearance this week that he had no idea they were being searched. he claimed.
Asked by host Laura Singh if he intended to fire his lawyer for allegedly failing to tell him about the trial date, he replied: “Maybe I should.”
He said that what Mr Zhu apparently did not know was that he would not have re-entered Singapore otherwise, so he returned despite having renounced his US citizenship to acquire Singaporean citizenship. He said that's why he hasn't.
Mr. Davis told New York Magazine, adding, “Mr. Sue's time in prison certainly surprised him. No one wants to go to prison.”
Davis was also sentenced to the same four-month prison term as Zhu by Singaporean authorities, but his whereabouts remain a mystery, although he reportedly was in Portugal in February, the outlet told the outlet. It is said that he spoke.
He added that he would not be returning to Singapore “any time soon” given the prison threat, but felt that “obviously these issues will just be resolved at some point and there will be reconciliation.”
Many were outraged by Davis' behavior on the podcast, where he appeared to be flippant when talking about the missing cash.
“It's how you build or what you do with it. We're definitely doing our best,” he said when asked about regrets.
“You can add value in a lot of different ways. You can also at least teach them how to do things better when the next Three Arrows goes bankrupt.”
His talk about “recovering” from bankrupt companies comes as 3AC founders' April 2023 startup by bankruptcy debt exchange OPNC also comes under scrutiny.
According to Coindesk, OPNX has been formally reprimanded by Dubai's crypto regulator for operating an unregulated exchange within a month of its establishment.
By February 2024, the exchange was shut down.
And while Davis continues to pop up in the cryptosphere, Zhu, who was released in December for good behavior, continues to be active through his efforts. Twitter accountwhere he still offers trading advice.
Their demise comes at a time when other crypto heavyweights are also facing fallout, with many saying the industry's vulnerabilities are becoming increasingly apparent.
Sam Bankman Freed, founder of the notorious Bahamian cryptocurrency company FTX, was convicted of one of the largest financial frauds in history while Zhu was in prison.
He awaits sentencing, scheduled for March 28. He faces more than 100 years in prison.
At the same time, former Binance CEO Qiao Changpeng pleaded guilty to anti-money laundering violations, and the traders behind Luna, which contributed to the collapse of 3AC, were extradited to the US and South Korea. was ordered.
Bankman Fried, who has been accused by US prosecutors as one of the worst financial criminals in history, directly blamed 3AC for the widespread crypto collapse in 2022.
“I suspect they are 80 percent of all initial infections,” he told New York Magazine in 2022.
“They weren't the only ones that exploded, but they did it on a much larger scale than anyone else. And before that, they had much higher trust from the ecosystem. .”
