Kyle Davies, the co-founder of the bankrupt hedge fund firm Three Arrow Capital (3AC), has announced his intention to donate future earnings from his new venture, Open Exchange (OPNX), to the creditors of 3AC.
Quick facts:
- Kyle Davies, co-founder of bankrupt hedge fund Three Arrow Capital, pledges to donate future OPNX earnings to 3AC creditors, separate from the liquidation process.
- The OPNX trading platform faces controversy allegedly over its founders.
- Davies cites good karma and encourages support for OPNX as a means to participate in the recovery process.
The move comes in the aftermath of the collapse of 3AC and the subsequent bankruptcy filings by several crypto lenders, including Celsius and Voyager.
During a Twitter Space conversation, Kyle Davies shed light on their “shadow recovery process,” aimed at benefiting the early supporters of OPNX who are also creditors of 3AC.
He clarified that this donation initiative is separate from the ongoing liquidation process of 3AC, which is being handled by Teneo, the appointed liquidator.
Teneo is responsible for selling the firm’s assets and distributing them to creditors in a separate procedure. Davies emphasized that there are specific creditors who were early supporters and have already recovered their investments or even made profits.
When questioned about the possibility of tokenized securities, Davies clarified that there would be no token involved in this process. Instead, he revealed their plan to donate future earnings generated by the OPNX exchange.
OPNX Enveloped in a Cloud of Controversy.
OPNX, announced by co-founder Su Zhu earlier this year and launched in April, introduced the trading of bankruptcy claims, which garnered criticism within the crypto community due to the questionable history of its founding team.
Concerns were raised regarding the authenticity of the trading volume reported by OPNX when it recently announced an all-time high.
An Act of “Good Karma?”
Davies justified the decision to support 3AC creditors through OPNX earnings as an act of “good karma.” He expressed his belief in something greater than all of them, whether it be religion or philosophy, and stated that by helping the creditors recover their losses, they contribute to a positive outcome and good karma.
“We very much believe that if we do good and we say to creditors who lost money, they have a way to make more back. If we do bad and they do well, then that’s great. And that’s good karma, or whatever you want to call it.“
Davis Stated.
Although the specifics of participating in Davies’ shadow recovery process remain unclear, he emphasized that supporting OPNX is the primary means of involvement.
Davies cautioned against criticizing or defaming OPNX, stating that active defaming is not part of the process, and encouraged traders, market makers, and those who simply want to publicly support the initiative to do so.
It’s important to note that while Davies and Zhu express their desire to donate to the 3AC creditors, they have been uncooperative with the 3AC liquidators, adding another layer of complexity to the situation.
The exact location of Kyle Davies and Su Zhu, the co-founders of Three Arrow Capital, remains undisclosed. Liquidators encountered difficulties in locating them and had to resort to serving subpoenas via Twitter on January 5th.
A recent report from The New York Times suggests that Davies and Su have been primarily residing in Bali, where they are said to spend a significant amount of their time surfing.
