Su Zhu blames FTX and DCG in Terra LUNA Collapse

Su Zhu blames FTX and DCG in Terra LUNA collapse

03.01.2023 12:40 (Updated 03.01.2023 12:01)
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by Aleksandar Đurić
2 min read

Su Zhu, co-founder of the troubled hedge fund Three Arrows Capital, leveled accusations against Digital Currency Group, pointing to its conspiracy with FTX in the collapse of Terra LUNA, which led to the bankruptcies of 3AC and Babel.

Su Zhu was responding primarily to the spreading accusations against Digital Currency Group (DCG), led by Gemini co-founder Cameron Winklevoss, who wrote an open letter to Barry Silbert on January 2.

In detail: Gemini sends a letter to DCG

According to Cameron, DCG owes Genesis $1.675 billion, and the latter owes Gemini because it is its lender in the paused Gemini Earn product. Gemini clients also reacted and filed a class action arbitration case, alleging Genesis became insolvent during the summer of 2022. Gemini clients have accused Genesis of deception, stating that DCG engaged in malicious practices including working with Genesis in exchange for the collection of $2.3 billion in debt from 3AC to Genesis, as well as the sale of unregistered securities. These actions are alleged to have been carried out to the detriment of both Gemini and its users.

Related: Gemini is struggling to unlock its Earn program

Su Zhu, the founder of 3AC, only confirmed the Gemini clients’ concerns. In a recent thread, Zhu accused DCG and FTX of conspiring to attack Terra Classic (formerly known as LUNA) and profiting from its collapse. Zhu further claimed that rather than restructuring in the wake of 3AC’s bankruptcy, DCG “magically” covered the Genesis losses. However, many have argued that Zhu should address his own actions rather than attempting to shift blame to others:

Meanwhile, this is not the first time that both Su Zhu and Kyle Davies have pointed fingers at others. After months of radio silence, they recently spoke out on Twitter and criticized the ex-CEO of FTX, Sam Bankman-Fried.

Related: 3AC liquidators seize $35.6M 

Moreover, the legal team representing the bankruptcy trustees has accused the founders of failing to communicate in a meaningful way with the liquidators. They have also criticized the founders for talking to the media and being active on social media while ignoring the receivers’ requests.

More: 3AC, here you are!

Author

  • An experienced journalist working in the film and video-game industries for many years. An enthusiast busy with learning new things about the world of crypto every day. Majored in English Language and Literature. Has a shrine in his apartment dedicated to Hidetaka Miyazaki.

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