LayerZero CEO Calls Out 3AC Over Fake Help – CryptoMode

LayerZero CEO Bryan Pellegrino has accused Three Arrows Capital (3AC) co-founder Kyle Davies of attempting to deceive and exploit LayerZero by persuading it to transfer its assets to the now-bankrupt crypto hedge fund before its collapse. Pellegrino claims that Davies offered preferential rates as a last-ditch effort to salvage the situation, but he believes that 3AC was not financially viable at the time. Davies has not apologized for 3AC's bankruptcy and has been subpoenaed by liquidators for failing to cooperate with authorities.

Three Arrows Capital Accused of Misleading Advice by LayerZero CEO

In a scathing rebuke, Bryan Pellegrino, the founder and CEO of LayerZero, has accused Three Arrows Capital (3AC) of providing "misleading advice" prior to its collapse. Pellegrino's allegations stem from an exchange with 3AC co-founder Kyle Davies, who allegedly attempted to persuade LayerZero to transfer its assets to the now-bankrupt crypto hedge fund.

According to Pellegrino, Davies approached LayerZero with a proposal to move its treasury to 3AC, offering preferential rates within the interoperability protocol. Pellegrino believes that this proposal was made in a desperate attempt to shore up 3AC's finances before its impending collapse.

"I would agree with this 100% and would be in your corner except for the fact that you tried to get us to give you our entire treasury promising better rates than other borrowers as a last gasp effort just days before you blew up," Pellegrino tweeted.

Pellegrino condemned Davies' actions, accusing him of deceiving and exploiting his close friends to save his company. He also criticized Davies' subsequent refusal to apologize to investors for the substantial losses incurred in 3AC's bankruptcy.

"He didn't mind deceiving and exploiting his close friends to try to prevent his company from collapsing," Pellegrino said.

Davies' lack of remorse has drawn widespread criticism on social media, with many accusing him of arrogance and a lack of accountability. During a recent appearance on the Unchained Podcast, Davies defended his actions, claiming that he remained professional until the end.

However, Pellegrino's allegations cast doubt on Davies' portrayal of events. He maintains that Davies was aware of 3AC's financial fragility when he approached LayerZero with his proposal.

"3AC was not financially buoyant when Kyle proposed that we move our treasury to 3AC," Pellegrino said.

3AC's collapse has been a major setback for the crypto industry. The hedge fund, which once managed over $3 billion in assets, filed for Chapter 15 bankruptcy in July 2022. Co-founders Davies and Su Zhu have since launched Open Exchange (OPNX), a platform offering crypto derivatives and claims trading services. However, the platform ceased operations early last month.

Davies and Zhu have also been served subpoenas by liquidators due to their failure to engage with relevant authorities. Zhu was arrested in Singapore last September for non-cooperation in 3AC's liquidation proceedings. Davies remains at large.

Pellegrino's accusations add to the growing body of evidence against Davies and 3AC. They raise serious questions about the ethics and integrity of the crypto industry and highlight the importance of due diligence and transparency.