Three Arrows Capital Founders Break Their Silence, Look to Move to Dubai: Report

The beleaguered duo discussed how one of the most successful crypto funds went from being a prominent trading desk to owing creditors $2.8 billion.

AccessTimeIconJul 22, 2022 at 9:14 a.m. UTC
Updated May 11, 2023 at 4:15 p.m. UTC

The founders of insolvent crypto hedge fund Three Arrows Capital, Su Zhu and Kyle Davies, have broken their silence in an interview with Bloomberg.

  • The duo described the collapse as "regrettable," but denied claims they pulled money from the fund before its collapse, according to the report.
  • The collapse of Three Arrows, also known as 3AC, was seemingly triggered by the fall of the Terra ecosystem and sent ripples in the crypto market. Investors are claiming the defunct fund still owes them $2.8 billion. On Monday, a 1,157-page court filing revealed the extent of the hedge fund's debt following the implosion, with individual claims worth over $1 billion.
  • The founders declined to say where they were, but one of the lawyers on the call said their ultimate destination is the United Arab Emirates (UAE), the report added.
  • “Given that we had planned to move the business to Dubai, we have to go there soon to assess whether we move there as originally planned or if the future holds something different for us,” Zhu added.
  • In the report, Zhu said the reason for the fund's collapse was placing leveraged trades with hope that the crypto market would rebound to the upside. He compared 3AC's implosion to that of Celsius Network, a crypto lending firm that froze withdrawals and filed for bankruptcy protection after it failed to keep enough liquidity to honor customer redemptions.
  • One of 3AC's largest positions that went sour was in the Terra ecosystem and its token LUNA, which effectively collapsed to zero in May. The pair insists they are cooperating with authorities while trying to keep a low profile.
  • “For Kyle and I, there’s so many crazy people in crypto that kind of made death threats or all this kind of noise,” Zhu said. “We feel that it’s just the interest for everyone if we can be physically secured and keep a low profile.”
  • Three Arrows Capital did not immediately respond to CoinDesk's request for a comment.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Oliver Knight

Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.