The Singapore High Court has rejected an application by Three Arrows Capital (3AC) to dismiss a legal challenge by Defiance Capital. The decision clears the way for DeFiance, led by founder Cheong Jun Yoong, to advance its claims.
Trust at the heart of the problem
The court recognized a legitimate fiduciary relationship and confirmed that DeFiance Capital’s investors were the legitimate beneficiaries of certain assets. Chong’s insistence that these assets should not be liquidated to resolve 3AC’s debts was supported by judicial authorities.
The dispute dates back to an agreement between Mr Cheong and 3AC co-founders Su Zhu and Kyle Davies to launch an independent fund under 3AC. The deal soured after 3AC, embroiled in financial turmoil, failed to make an agreed transfer of assets before declaring bankruptcy in July 2022.
The court’s recent ruling brings Defiance Capital one step closer to regaining control of its assets. The case highlights the complex dynamics of the crypto investment world and signals legal authorities’ vigilance over issues of trust and ownership.
Also read: 3AC Su Zhu’s statement addresses Defiance capital dispute