The entire stablecoin market is now worth over $160 billion.

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According to recently filed court documents in New York, the co-founders of bankrupt crypto hedge fund Three Arrows Capital appear to be on the run from their creditors.

Lawyers representing creditors say the physical whereabouts of Zhu Su and Kyle Davies, who started Three Arrows in 2012, are “currently unknown,” ahead of a hearing scheduled for 9 a.m. ET on Tuesday to discuss next steps in the litigation process. liquidation. The documents, filed Friday evening, also allege that the founders have yet to begin cooperating with the liquidation process “in a meaningful way.” On Monday, the lawyers asked the court to keep the identity of the creditors anonymous.

Zhu and Davies did not respond to requests for comment.

Three Arrows, also known as 3AC, managed around $10 billion in assets as recently as March. On July 1, the company filed for Chapter 15 bankruptcy with U.S. creditors in the Southern District of New York, after a cryptocurrency plunge and the collapse of stablecoin project terraUSD (UST) wiped out its assets.

Ahead of the bankruptcy filing, a court in the British Virgin Islands ordered the embattled fund to be liquidated in order to pay off its debts.

Now 3AC is in bankruptcy court, facing angry lenders who want their money back. Global consultancy Teneo was brought in to help manage the liquidation, starting with trying to figure out what was left.

According to Friday’s court filing, Zhu and Davies, both former Credit Suisse traders, participated in a Zoom introductory call last week to discuss basic steps to preserve their assets. Neither of the founders turned on their video, and both remained silent throughout, with all dialogue conducted through an attorney. Their lawyers said at the time that they “intend to cooperate”.

During the meeting, representatives helping facilitate the liquidation demanded immediate access to 3AC offices and information about their bank accounts and digital wallets. As of Friday, that access had not been granted, according to the filing.

When the fund’s liquidators arrived at 3AC’s office in Singapore in late June to attempt to meet the founders, “the offices appeared vacant except for a number of idle computer screens”.

The filing notes that while the office door was locked, reps could see unopened mail addressed to Three Arrows, which “appeared to have been pushed under the door or leaned against the door.” Neighbors in surrounding offices said they last saw people in the 3AC office in early June.

Meanwhile, creditors are trying to figure out what assets remain.

Teneo’s Russell Crumpler, who has been tasked with helping facilitate the bankruptcy process, said in an affidavit that there is a “real risk” that 3AC’s assets will disappear “in the absence of immediate authority to proceed with the discovery”.

“This risk is heightened because a substantial portion of the obligor’s assets are comprised of cash and digital assets, such as non-fungible cryptocurrencies and tokens, which are readily transferable,” Crumpler said in its statement.

There are reasons for such concern. One of 3AC’s NFTs has been transferred to another crypto wallet, according to a well-known NFT collector and investor.

In Friday’s filing, creditors asked the court to suspend 3AC’s right to transfer or dispose of any assets. The attorneys are also asking that the court subpoena the founders or others who may have information about 3AC’s assets. This could include banks, crypto exchanges, and counterparties.

3AC’s insolvency has already had a major impact on the broader crypto market, as many institutions had money with the company.

Digital asset brokerage Voyager Digital filed for Chapter 11 bankruptcy after 3AC was unable to repay some $670 million it had borrowed from the company. US-based crypto lenders Genesis and BlockFi, crypto derivatives platform BitMEX and FTX crypto exchange also suffer losses.

LOOK: Voyager Digital suspends withdrawals as Three Arrows Capital files for bankruptcy