A court in the British Virgin Islands has issued a worldwide asset freeze amounting to $1.14 billion on the co-founders of the collapsed cryptocurrency hedge fund Three Arrows Capital, as confirmed by liquidators Teneo on Thursday. The hedge fund filed for bankruptcy last year following a significant sell-off in assets, triggered by a downturn in cryptocurrency markets.
The freeze order, effective Monday, targets co-founders Su Zhu and Kyle Davies, along with Davies’ wife, Kelly Chen. The court directive prohibits the named individuals from dealing with their assets, including transfers or sales, up to the specified value of US$1.144 billion. According to Teneo’s statement, the order aims to convey a clear message about legal obligations and risks to counterparties and affiliates associated with the founders of Three Arrows.
The inclusion of Kyle Davies’ wife in the freeze order reflects an expanded effort by the liquidators to recover assets. Su Zhu, one of the co-founders, was arrested in late September while attempting to leave Singapore and is currently serving a four-month imprisonment. The current whereabouts of Kyle Davies and his wife are unknown. All three individuals are Singapore citizens.
In response to the hedge fund’s failure, Singapore’s monetary authority had previously banned Su Zhu and Kyle Davies from engaging in regulated investment activity in the country for nine years each. The liquidators, appointed by a court in the British Virgin Islands to oversee the bankruptcy proceedings, are actively working to recover Three Arrows’ assets and provide returns to its creditors. However, they have alleged that Zhu and Davies are not cooperating with the recovery efforts and have not voluntarily provided necessary information.