Kyle Davies, co-founder of Three Arrows Capital (3AC), attempted to persuade the omnichain protocol LayerZero to hand over the project’s entire treasury just days before the hedge fund’s collapse.
Earlier, Davies stated on the Unchained podcast that he does not regret losing billions of dollars of investors’ money and plans to avoid imprisonment by any means.
In a recent X-post, he reiterated his stance and refused to apologize for the events.
I wasn’t grinning, I just have big teeth
But I will never apologize for blowing up. We were traders who devoutly believed in up only forever. Still do. Lenders chose to gamble their own low risk clients funds on a high risk thesis. Pointing fingers is for cowards
Remilio pic.twitter.com/FLWfTeyCQy
— Kyle ? (@KyleLDavies) March 21, 2024
“I wasn’t grinning, I just have big teeth. But I will never apologize for the failure. We were traders who sincerely believed in only going up. We still do. Lenders chose to stake their low-risk clients’ funds on a high-risk thesis. Pointing fingers is for cowards,” he noted.
In response to the post, LayerZero’s co-founder and CEO Bryan Pellegrino revealed that 3AC attempted to “convince the project to hand over the entire treasury, promising higher interest rates than other borrowers” just days before the collapse.
I would agree with this 100% and would be in your corner except for the fact that you tried to get us to give you our entire treasury promising better rates than other borrowers as a last gasp effort just days before you blew up.
— Bryan Pellegrino (@PrimordialAA) March 21, 2024
“Liquidation is one thing, but lying and exploiting your friends, portfolio companies, and those around you is quite another,” emphasized the protocol’s head.
Pellegrino also added that 3AC was already insolvent when it proposed the deal to LayerZero.
In May 2022, following the cryptocurrency market crash and Terra’s collapse, reports emerged of a potential default by Three Arrows Capital.
In late June, a court in the British Virgin Islands ordered the liquidation of the hedge fund. In July, 3AC filed for bankruptcy in a New York court. According to Nansen, the organization managed assets worth around $10 billion.
In September 2023, the company’s other co-founder, Su Zhu, was detained in Singapore while attempting to leave the country. Local authorities banned the hedge fund’s founders from participating in regulated business activities for nine years.
In December, a court froze assets belonging to Davies and Zhu worth $1.14 billion.