- 3AC co-founder Kyle Davis refuses to apologize during an interview on the Unchained podcast.
- Mainstream media backlash ensues.
- Davis doubles down, saying he will never apologize for losing billions.
The failed high-risk trading strategies employed by Three Arrows Capital (3AC) represented a major domino in the onset of crypto winter. Co-founders Su Zhu and Kyle Davis were complicit in the crypto hedge fund’s bust in mid-2022, leaving a trail of devastation. In the aftermath, the pair evaded creditors and were even briefly jailed in Singapore for failing to cooperate with probes into 3AC’s implosion.
Davis faced a grilling during a recent interview on the Unchained podcast but refused to say sorry for what had happened. The unapologetic stance quickly drew backlash, with the Daily Mail running a scathing piece labeling Davis a “brazen on-the-run coward” for grinning while discussing the events. But rather than bend to the backlash, Davis doubled down by saying he would “never apologize.”
3AC Co-Founder Blames Creditors
In response to the Daily Mail backlash, Davis doubled down in refusing to apologize once more, explaining that he wasn’t grinning; he simply has “big teeth.” Davis added, “We were traders who devoutly believed in up only forever,” before switching tracks to blame 3AC’s creditors for agreeing to lend funds on a “high-risk thesis.”
The Daily Mail is a British tabloid that has an upper-middle-class readership with an average age of 56. The comments to the Daily Mail’s article slamming Davis were largely anti-crypto, highlighting society’s divergence when it comes to cryptocurrency.
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One commenter took the opportunity to question the point of digital assets, saying “crypto “currencies” or anything deriving from them are not assets. They are no more than an inefficient medium of exchange [sic].” Another commented that cryptocurrency is not a bona fide investment, rather it is a “fake currency.”
“Not sure why anyone would ever 'invest' in crypto. It is a fake currency made up by some stranger on an imaginary exchange which he runs,” remarked the Daily Mail commenter.
While no-coiners harbored deep skepticism about crypto, industry figures, some of whom had direct dealings with 3AC, took an even more scathing view of Davis’ bravado.
Crypto Industry Figures Not Impressed
While Davis boldly expressed his position on the mainstream media backlash, crypto industry figures promptly joined in, adding their voices to the chorus of criticism. BitMEX co-founder Arthur Hayes tweeted “F*ck your apology,” while calling out Davis’ failure to cooperate with the liquidators overseeing 3AC’s bankruptcy process.
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BlockTower Capital founder Ari Paul took an even harsher stance, accusing Davis of fraud, theft, and lack of ethical behavior. Paul’s killer blow came as he wrote “Don’t apologize for failing as a trader, apologize for the lying and stealing.”
LayerZero co-founder Bryan Pellegrino claimed that Davis had tried desperately to get the firm to hand over its entire treasury to 3AC on the promise of high returns just days before the crypto hedge fund’s stunning collapse.
On the Flipside
- The British Virgin Island Court ordered a freeze on the 3AC co-founders‘ assets in December 2023, as liquidators Teneo attempted to recoup funds for creditor re-distribution.
- The co-founders were in Dubai before being jailed in Singapore in September 2023, but their current whereabouts are unknown.
Why This Matters
Davis’ brazen refusal to take responsibility is a slap in the face to the investors who lost billions. This saga highlights the need for more oversight to protect investors from seemingly unaccountable individuals.
Read about Zhu’s “magical” experience in Singapore prison here:
3AC’s Su Zhu: “I Had the Best Sleep of My Life in Prison”
Find out more on renewed concerns over Ethereum’s securities status here:
