3AC founder says DCG and FTX conspired for Terra Collapse, calls criminal fraud

Last year saw some of the most dramatic crypto-related collapses. It all began with the May 2022 first collapse of Terra’s (LUNA), which eroded $40 Billion of investors’ wealth within a week.
Three Arrows Capital (3AC), the largest crypto hedge fund in the world, was immediately wiped out by the contagion. Zhu Su, founder of 3AC, has now openly blamed Digital Currency Group (DCG), the parent company of Grayscale Investments & Genesis Trading, for the collapse of Terra.


Zhu Su claims that DCG and FTX conspired to bring down LUNa, STETH in his latest Twitter thread. After the Terra collapse, DCG as well as FTX suffered substantial losses. Babel and other firms involved in GBTC also suffered significant losses.
3AC founder says DCG could have been a partner in the restructuring process. They instead forged a left pocket right-pocket callable promissory note which magically filled the gap. He adds, “This is like a child losing at poker and saying, “I am fine, my father will pay you, let’s play more.”
A Light on DCG’s Genesis Troubles

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We all know that the collapse of FTX caused a major liquidity crisis at DCG’s crypto lending subsidiary Genesis Global. Zhu Su believes Genesis was already in trouble before the Terra collapse.
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He claims that DCG, FTX used the fall of 3AC to “misdirect” crypto communities for months and used multiple methods to do so. This is how Genesis filled its holder. They took deposits for six months after the Terra collapse and hoped that the markets would rise. Zhu Su calls it a criminal fraud noting:
“Dcg value: 0, criminal fraud, ftx creditors also have case for fraudulent conveyance of Alameda capital returns to Genesis 8. Most OGs know how close Barry was to SBF since the beginning (SBF is on genesis, they gave him his initial ftt backed loan).


Zhu Su believes that Genesis will soon slip into bankruptcy. The creditors are hoping that Barry Silbert will help them cash out quickly and not go through the DoJ route.
Zhu Su isn’t the only one to blame DCG. Do Kwon, Terra founder, made similar claims last month.

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