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TPS Capital Says It's 'Independent' From Three Arrows Capital

Tracy Wang - Coindesk
2022-07-08 02:16
TPS Capital, which once described itself on its LinkedIn page as the over-the-counter (OTC) trading arm of Three Arrows Capital, said Wednesday it's an independent firm with separate management.
TPS released a statement on Twitter distancing itself from Three Arrows Capital, also known as 3AC.
Three Arrows Capital, a highly active crypto investment firm with several billion dollars in assets, shocked the crypto community last month when rumors surfaced that the firm was insolvent. Ultimately, the rumors proved true and the firm filed for bankruptcy last week. It is currently in the process of liquidating its assets with a British Virgin Islands court-appointed liquidator.
In addition to the LinkedIn page, which has since been amended, a trail of official documents from Singapore to the Cayman Islands and the British Virgin Islands shows various links between the firms.
“TPS is an independent legal entity and its operations are separate and distinct from those of 3AC,” said the statement. “TPS is run by a separate management team and operates its main count business without the involvement of 3AC or its principals.”
“My focus is on the business and my team members at the present,” TPS Capital CEO Timothy Chan told CoinDesk.
Now, TPS, named after the Tai Ping Shan mountain on the island of Hong Kong, says Three Arrows Capital was merely a TPS client and the two entities’ cooperation was more within a “referral capacity,” with TPS serving as an “agent” or “intermediary” in financial transactions.
TPS Capital said that Su Zhu and Kyle Davis, co-founders of 3AC, both had indirect equity interests in TPS, but went on to qualify that the pair were “passive investors and do not run or have any direct control over TPS’s day-to-day operations.”
Additionally, TPS says it helped 3AC coordinate loan arrangements with various lenders, but only at 3AC’s request.
“Our most recent dealing with 3AC was limited to acting as an agent of loans between lenders and 3AC,” said TPS.
3AC’s loan counterparties included BlockFi, CoinDesk sister company Genesis Global Trading and Voyager, centralized lending desks that all faced steep losses when Three Arrows defaulted on its loans. The loans reached into the hundreds of millions of dollars for each lender, and in some cases they were undercollateralized.
Last week, 3AC counterparty BlockFi got a $400 million credit line from Sam Bankman-Fried’s FTX that also comes with an option for FTX to purchase the company. The crypto lender Voyager filed for bankruptcy on Tuesday after issuing a notice of default to 3AC last month.
A few words on 3AC and its impact on TPS pic.twitter.com/zijPLlNb0l
— TPSCapital (@TPSCapital) July 7, 2022
TPS said that it, too, was “blindsided” by the collapse of Three Arrows Capital and is now one of Three Arrows Capital’s creditors.
“We are also in the same boat with many lenders of 3AC, with our own assets exposed to 3AC, and operating with no additional information,” said TPS Capital.
TPS said in the statement that its officials are not in communication with Three Arrows Capital and have not been in communication since the firm was ordered to begin liquidation on June 27.
“As with other 3AC counterparties, our calls and messages are being left unanswered,” said TPS in a statement. “TPS intends to be open and transparent with everyone involved as the situation evolves, and will continue the work we set out to do.”
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