Su Zhu, co-founder of Three Arrows Capital, alleged on Twitter that DCG and FTX conspired to attack LUNA and stETH. He accused them of working in the wrong direction.
Su Zhu, co-founder of bankrupt hedge fund Three Arrows Capital, launched a scathing attack on Twitter over Terra’s collapse. Zhu blamed Digital Currency Group and FTX for working together to attack Terra’s LUNA token and stETH. The latter event bankrupted 3AC.
Here is the brief summary of DCG status
1) He conspired w ftx to attack Luna and Steth and did pretty much anything to do so
2) in the summer they suffered a lot from our bankruptcy, as well as from Babel and other firms involved in GBTC
3) They could then reconstitute peacefully
Zhu Su
(@zhusu) January 3, 2023
Zhu posted a Twitter thread on January 3, saying that DCG conspired with FTX to “attack Luna and stETH” and went to great lengths to do so. He said the firm “invented a left pocket right pocket callable promissory note that magically filled the hole.”
He also accused DCG and FTX of being involved in the wrong direction and using different methods to attack the hedge fund. Essentially, he alleges that DCG and FTX used the collapse of 3AC to take more deposits during the bankruptcy, hoping the market would go up.
Zhu also briefly mentioned stETH dpeg in the post. The event saw lido-offering tokens trade below the price of ETH, resulting in concerns about cascading effects.
Winklevoss has harsh words for DCG founder
DCG and its founder Barry Silbert have been in controversy for other reasons as well. Gemini co-founder Cameron Winklevoss tweeted an open letter to Silbert, criticizing him for his poor strategy. The exchange, DCG and its parent company Genesis are working towards a solution to return user funds.
Winklevoss said the DCG “engaged in malicious stall tactics.” He also said that Silbert had refused to “agree to a timeline with significant milestones”.
Three Gemini users have also filed a Request for Class Action Arbitration against Genesis and DCG. This is in response to Gemini pausing its Earn program after Genesis stopped withdrawals.
Silbert has responded to the letter denying any missed payments. He clearly states that “DCG did not borrow $1.675 billion from Origin.” He also claimed that the DCG made a proposal on December 29 and did not receive any response.
The Three Arrows Capital Saga Continues
There have been several updates to the 3AC saga over the past few months. A bankruptcy judge approved a subpoena involving the leadership, including co-founders Su Zhu and Kyle Davis. Meanwhile, liquidators have filed a $30 million claim for the super yacht.
The liquidator has stated that the founders are not cooperating in the investigation. In turn, it becomes difficult to compensate the creditors. He has said that both founders undermined recovery efforts.
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