Today, a ruling from the U.S. bankruptcy court has stipulated that Three Arrows Capital (3AC) founder Kyle Davies must respond to a subpoena within two weeks regarding the hedge fund's books and records. The subpoena was served to Davies via Twitter and it was approved by the court as abiding the requirements of due process. Moreover, the cryptocurrency entrepreneur has been instructed to appear in court in the British Virgin Islands on May 22, considering the refusal to comply could amount to contempt of court.

Having peaked in June 2020 at a staggering $3 billion in liabilities, Three Arrows Capital's bullish trading strategy quickly collapsed alongside the plummeting crypto market. This event played a significant part in the bankruptcy and closure of companies such as Voyager Digital, Celsius Network and Genesis Asia Pacific, with the latter being a subsidiary of digital currency behemoth Digital Currency Group - the same company that also owns CoinDesk.

Russell Crumpler and Christopher Farmer, the court-appointed liquidators of the hedge fund, have accused Davies and 3AC co-founder Su Zhu of failing to engage in the relevant proceedings. As they jointly declared in a February 8th filing, Davies and Shu only responded to some inquiries, neglecting to address the majority of the issues.

The liquidators had previously attempted to serve the court-approved subpoena to Davies via Twitter on January 5th, yet the individual remained silent, failing to comply with the inquiry. This recent outcome offers a degree of closure for investors that 3AC may have affected. If Davies does not respond to the subpoena within the two week timeframe, he will be held to account in court and could be liable to criminal charges.



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