The founders of the embattled crypto hedge fund Three Arrows Capital (3AC), which filed for bankruptcy in early July, have resurfaced after weeks of their viral disappearance.
In a recent interview with Bloomberg, the two co-founders of Three Arrows Capital, Su Zhu, and Kyle Davies have jointly admitted that overconfidence, which came from the humbled bull market, was the reason behind the collapse of the firm.
They said some bad decisions they made during the bull market should have been avoided if not for overconfidence.
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Zhu discussed their ties with Terra (LUNA) founder Do Kwon and claimed they thought there were greater things ahead for the company.
In his statement, closeness with Do Kwon boosted their overconfidence, which made them ignore a number of red flags when the firm was still in full operation. This later liquidated $500 million worth of investment.
Read Also: Three Arrows Capital (3AC) Files Chapter 15 Bankruptcy, Seeking to Defend its US Assets
Su Zhu noted:
“If we could have seen that, you know, that this was now like, potentially like attackable in some ways, and that it had grown too, you know, too big, too fast.”
Bitcoin (BTC) Crash Initiated Major Setback
The two founders further claimed that Terra (LUNA), now Luna Classic (LUNC), was a also setback for the firm. But the major problem was initiated by the crash of Bitcoin (BTC) to $20,000, making it impossible for the firm to access additional credit.
According to Zhu, business continued as usual after the collapse of Terra (LUNA) but Bitcoin (BTC) collapse made the matter worse.
Zhu explained: “Throughout that period, we continued to do business as usual. But then yeah, after that day, when, you know, Bitcoin went from $30,000 to $20,000, you know, that, that was extremely painful for us. And that was in, that ended up being kind of the nail in the coffin.”
Read Also: $559.6 Million Used By Three Arrows Capital (3AC) to Acquire Locked LUNA Now Worth $670
Why They Disappeared and Their Whereabouts
Speaking on their whereabouts and why they suddenly disappeared, the 3AC founders said they both went underground due to a series of death threats they were directed at them. However, they didn’t reveal their current location but said they were moving to Dubai.
Disclaiming other allegations, the founders said they didn’t withdraw any money from 3AC before it went bankrupt.
Regarding the $50 million yacht that was disclosed in the recently filed lawsuit, Zhu said that the boat was bought over a year ago and commissioned to be built and to be used in Europe. He also claimed that the yacht has a full money trail.
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