LayerZero CEO Kyle Davis wanted a full treasury allocation days before 3AC dropped.
LayerZero co-founder and CEO Brian Pellegrino accused Three Arrows Capital's Kyle Davis of trying to lure LayerZero's entire treasury into the defunct crypto hedge fund shortly before it collapsed.
Pellegrino made the allegations in a response to the X-Post on Thursday, saying Davis had promised LayerZero “better rates than other borrowers” in a “last-ditch effort” before the collapse.
“Liquidation is one thing,” LayerZero's boss said. It's another to lie and exploit your friends, your peers, and the people around you.”
In an episode of the Unchained Podcast, Davis refuses to apologize to investors who lost billions in 3AC's bankruptcy and collapse, and despite backlash on social media for his misdeeds, his professional reputation remains intact.
Davies wrote on X: “We have always been honest businessmen. Do it again. Lenders chose to gamble their own low-risk customer funds against high-risk research.
However, Pellegrino criticized Davies for misleading and using allies and partners. Pellegrino also stated that 3AC was financially unstable when it presented the event to LayerZero.
Davis had not responded to Pellegrino's posts on X at the time of publication.
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Following the collapse of Terra in May 2022, 3AC, a well-known hedge fund manager in the crypto industry with over $3 billion in assets, filed for bankruptcy in July of that year due to liquidity challenges.
Davis and Su Zhou, founders of 3AC, then launched Open Exchange (OPNX), a trading platform for crypto derivatives and claims, in April 2023.
In the year On January 5, 2023, Davies and Xu were subpoenaed by X for avoiding meeting with relevant authorities and “failing to cooperate satisfactorily” with Liquidators.
Zhou was arrested in Singapore last September and detained until December for not cooperating with 3AC's liquidation demands. Davis, however, dismissed the threat.
In a recent podcast, Davis said he stayed away from Singapore to avoid possible arrest.
On December 21, a court in the British Virgin Islands froze Davis and Zhu's assets worth $1.14 billion. 3AC liquidator Teneo is seeking $1.3 billion directly from Zhu and Davis, saying 3AC took too much from investor funds after the bankruptcy.
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