A United States court has given liquidators permission to subpoena the founders of cryptocurrency investment firm Three Arrows Capital (3AC), including Su Zhu and Kyle Davies.
According to a Law360 report on Tuesday, U.S. Bankruptcy Judge Martin Glenn issued an order Tuesday allowing the subpoenas after being told by the liquidators’ attorney that the founders’ whereabouts are unknown and there were fears they could be selling tens of millions in assets.
The attorney, Adam Goldberg, said he was unaware of the current whereabouts of either Zhu or Davies, claiming the duo had not provided “meaningful cooperation” with the liquidators.
Goldberg expressed concern that 3AC is selling assets, pointing to media reports that Zhu was selling a Singapore property valued at “tens of millions.”
The job of a liquidator is to assess the value of an insolvent company or individual and sell the assets to satisfy unpaid debts.. Liquidators may have trouble cashing out 3AC crypto assets if you don’t have jurisdiction over the wallets.
The judge presiding over the case, Martin Glenn, acknowledged that mining of the company’s crypto funds presents “complicated issues” regarding the location of the company’s cryptocurrency wallets.
Bloomberg reported on Tuesday that Goldberg maintains that cryptocurrency wallets fall under the jurisdiction of the United States and those assets are now subject to his client’s discretion. Goldberg said:
“A fundamental part of this motion is to let the world know that it is the liquidators who control the debtor’s assets at this stage.”
Three Arrows Capital is a high-profile investment firm founded in 2012 and headquartered in Singapore that boasted more than $18 billion in assets under management at the end of April, but may have lost a significant portion of that net worth following the Luna Classic (LUNC) token drop in May.
Since then, 3AC has defaulted on some $1.5 billion in loans from cryptocurrency lenders Voyager Digital and BlockFi.
The founders of 3AC, Zhu and Davies, too, have been virtually radio silent since June 14, and their location has remained a mystery to the public.
Zhu briefly broke his weeks-long silence on Tuesday via a Twitter post condemning the liquidators for provoking him by not making a purchase of Starkware tokens.
Since June, The layers of 3AC’s alleged dealings have been uncovered, leading to liquidations in the British Virgin Islands and financial calamities on various cryptocurrency platforms.
3AC loan defaults have taken some of the blame for Voyager filing for bankruptcy and BlockFi being forced into a position where it could be bought by crypto exchange FTX.US. 3AC also filed for Chapter 15 bankruptcy on July 1.
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