GTX, the new crypto project from the founders… of the bankrupt fund Three Arrow Capital

Su Zhu and Kyle Davies want to launch the GTX exchange, relying on the bankruptcies of current and future crypto companies such as FTX. They are looking to raise $25 million.

Navigating the recent bankruptcies of Celsius, BlockFi and FTX when you went bankrupt yourself, you had to be brave. Su Zhu and Kyle Davies, co-founders of investment fund Three Arrow Capital (3AC), did just that. The former traders want to launch a trading platform called “GTX”, in a move to FTX, “because the G comes after the F”, according to document their lunar appearance.

Because you need to find a place to redeem yourself, GTX aims to take advantage of current and future bankruptcies in the crypto ecosystem. As a reminder, when a company goes bankrupt, customers may decide to sell their receivables to companies or investment funds in order to get immediate cash without waiting too long. We see this for example with Mt Gox, a crypto exchange platform that has been bankrupt since 2014, customers can expect a refund no earlier than 2023, that is 10 years later.

Here, the former founders of 3AC believe they have found a solution, creating a trading platform that would connect cryptocurrencies and customer receivables, all with high-risk speculation. Specifically, the platform would bring together users who wish to settle customer claims, while the latter can abandon their GTX claims and receive a stable currency called “USGD” in exchange.

In their presentation document, Celsius, BlockFi, Mt Gox, but above all FTX are mentioned as examples of companies where it is good to buy debt. GTX also values ​​this market at $20 billion, in which other companies such as XClaims or Claims-Market are already present. Of course, GTX ensures that its prices will be much lower than its competitors. To top it all off, GTX specifies that it already has a team of 60 developers at its disposal and has partnered with crypto exchange platform CoinFlex.

Risky bet

The team hopes to launch this project within a month, raising $25 million from investors. But what investor can trust the founders of 3AC, who have proven to be quite peerless over the past few months?

As a reminder, founded in 2012, 3AC was one of the largest investors in the crypto ecosystem, reaching up to $10 billion in assets. end has invested in blockchains like Bitcoin, Ethereum or even in the Terra Luna ecosystem. Bad luck: After the collapse of Terra Luna, the fund found itself unable to repay its creditors in mid-June. Indeed, 3AC owed more than $3.5 billion to its 27 creditors, including Genesis Global Trading and Voyager Digital. Failing to do so, 3AC did bankruptcy on June 27, the British Virgin Islands court ordered its liquidation.

But today, the former founders of 3AC prefer to focus on GTX rather than face their responsibilities.

“Advisors working on the liquidation of 3AC have accused Davies and Zhu of not cooperating with the liquidation process. Last week, the advisors issued a call for the co-founders on Twitter, saying they had still not been located.” Block.

“Convert their debts”

The former founders of 3AC want to go even further, connecting their current project with their former bankrupt company.

“Zhu and Davies are offering some 3AC creditors to convert their claims to shares in the new venture, according to minutes of a Jan. 11 creditors’ meeting,” it reports Bloomberg.

“Many institutional investors will not be willing to invest in any new venture from the co-founders of 3AC until all outstanding legal and regulatory issues related to 3AC, both inside and outside of Singapore, are resolved,” believes Chris Holland. , partner in Holland. & Marie, who was interviewed by Bloomberg.

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