Three Arrows Capital's Kyle Davies Ordered to Respond to Subpoena Within 2 Weeks

The U.S. bankruptcy court also ruled the crypto hedge fund's liquidators' service of a subpoena to Davies via Twitter complied with due process.

AccessTimeIconMar 30, 2023 at 2:58 p.m. UTC
Updated Mar 30, 2023 at 3:20 p.m. UTC
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Three Arrows Capital (3AC) founder Kyle Davies has two weeks to respond to a subpoena pertaining to the books and records of the bankrupt hedge fund, according to a ruling in U.S. bankruptcy court.

Davies and fellow 3AC co-founder Su Zhu have previously been accused of refusing to engage in proceedings for the firm's bankruptcy. "[Davies and Zhu] have made only selective and piecemeal disclosures ... Refusal to cooperate violates their duties owed to Three Arrows," said the hedge fund's liquidators, Russell Crumpler and Christopher Farmer, in a court filing on Feb. 8.

Crumpler and Farmer also attempted to serve a court-approved subpoena to Davies via Twitter on Jan. 5, but Davies ignored it despite being active on the social media site, the filing added.

Today's ruling said the court had determined the service of the subpoena via Twitter "comported with the requirements and due process."

Davies and Zhu have also been ordered to appear in court in the British Virgin Islands on May 22. They will be found in contempt of court if they fail to reply to that demand, the court said this week.

3AC collapsed in June with $3 billion in liabilities against $1 billion in assets when its bullish trading strategy collapsed alongside the crypto bear market. 3AC's implosion played a part in similar failures from a number of other crypto firms with exposure to the hedge fund, including Voyager Digital, Celsius Network and Genesis Asia Pacific.

Genesis Asia Pacific is a division of Genesis Global. CoinDesk and Genesis Global share the same parent, Digital Currency Group.

Edited by Stephen Alpher.


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Jamie Crawley

Jamie Crawley is a CoinDesk news reporter based in London.

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