Collapsed 3AC's Founders to Raise $25 Million for a New Crypto Exchange

Founders behind bankrupt crypto hedge fund Three Arrows Capital (3AC) Su Zhu and Kyle Davies are seeking a fresh injection of US$25 million to set up a new crypto marketplace, apparently known as GTX.

The new project seeks to "dominate the crypto claims market within two to three months of going live". Zhu said that the idea was to allow clients from bankrupt exchange FTX and other insolvent estates to access their capital and start investing again.

The platform aims to "verify and tokenise" these customers' claims and allow customers to use these claims as collateral, Zhu added.

Both founders said: "Creditors may continue to hold their claims to maturity or elect to sell them to crypto, while using these claims as margin capital." They also estimated the claims market size to be at US$20 billion.

Members of the founding team on the new project included both Davies and Zhu, as well as co-founders of crypto exchange CoinFlex – Mark Lamb and Sudhu Arumugam.

Much controversy surrounds the new project after Zhu's 3AC collapsed in June last year. The cryptocurrency hedge fund went into liquidation following an order from a British Virgin Island court. At its peak, the fund had more than US$4 billion in assets under management.

The company's failure was reportedly caused by a wave of collapses, including the Terra-Luna crash, which 3AC had bet big on.

Of late, both Zhu and Davies have been active on social media and have publicly blamed Sam Bankman-Fried, FTX founder and chief executive, of betting against 3AC's position and dealing the fund the final blow.

Source: The Business Times