Three Arrows Capital is currently facing insolvency, as the crypto investment firm has been liquidated by several lenders following the market turmoil. It now seems like the venture capital firm was not slated to move its headquarters to Dubai as earlier announced.
A spokesperson from the Dubai Financial Services Authority (DFSA) has said that Three Arrows Capital was not a registered financial services provider in the region. The spokesperson said the crypto investment fund was neither registered with the DFSA nor regulated by the entity.
“We can confirm that Three Arrows Capital is not a DFSA authorized firm and is not regulated by the DFSA,” the spokesperson said. Dubai has become one of the most welcoming crypto locations globally. Some leading crypto firms globally, including Binance and FTX, have hinted at moving their headquarters to the country.
The DFSA statement is contrary to what had been announced by the co-founder of 3AC, Zhu Su. In April, Su announced that the firm would be moving to Dubai. He also added that the company would unveil a $5 billion fund launched in Dubai, adding that the city has a friendly regulatory framework compared to other jurisdictions such as Singapore.
The friendly regulatory framework is one of the top reasons for making Dubai a crypto hub. In March, the city unveiled the Virtual Asset Regulatory Authority. Several developments have been sprouting in the city, such as a school that accepts Bitcoin and Ethereum as payments for tuition.
In Singapore, the Monetary Authority of Singapore (MAS) has regulatory authority over crypto firms. In Dubai, crypto firms that want to operate in the Dubai International Financial Centre must seek regulatory approval from the DFSA, according to the regulator’s website. The MAS has vowed to crack down on bad actors in the cryptocurrency sector.
3AC faces liquidity issues
3AC has been under pressure following the recent market dip. The company has faced several liquidations on its leveraged positions. The collapse of 3AC is also causing ripple effects across the sector. Zhu said 3AC could pursue an asset sale and bailout options following the collapse.
3AC does not appear to have registered in the city. The National Economic Register does not show any companies that match the description of the DIFC. However, Su could be currently in Dubai, according to his Twitter location.
For more 3AC crypto news, check out the news section on CoinCodex.
