Zhu Su: How to go from a loss of 10 billion U to 0 U?

Zhu Su is a China-born cryptocurrency investor , entrepreneur, and social media influencer.

He was previously the co-founder, CEO and chief investment officer of Three Arrows Capital and the founder of the OX Protocol.

It can be said that he is famous for his investment achievements in the field of cryptocurrency and his influence on the market, but he is also hunted and charged for suspected fraud, tax evasion and money laundering.

Three Arrows Capital: A leader in the cryptocurrency market

Zhu Su and his high school classmate Kyle Davies founded Three Arrows Capital in Singapore in 2012, a hedge fund focused on cryptocurrencies and derivatives.

Three Arrows Capital initially engaged in foreign exchange arbitrage trading in emerging markets, and later turned to the field of cryptocurrency, investing in many well-known projects and platforms including Bitcoin, Ethereum, Polkadot, Huobi, FTX, LUNA, etc.

Three Arrows Capital's asset management scale once reached 10 billion US dollars . It is one of the largest hedge funds in the cryptocurrency market and was once considered a "top stream" among many hedge funds in the cryptocurrency circle.

As the leader of Three Arrows Capital, Zhu Su has also accumulated more than 500,000 Twitter followers, becoming an opinion leader and market vane in the cryptocurrency field.

Three Arrows: Diversification, Foresight and Boldness

Three Arrows Capital’s investment strategy in the cryptocurrency space can be summarized in three words: diversified, forward-looking, and bold.

Diversity

Three Arrows Capital not only invests in various types of cryptocurrencies, such as Bitcoin, Ethereum, etc., but also invests in projects in various fields , such as decentralized finance (DeFi), non-fungible tokens (NFT), Metaverse, cross-chain bridge, stablecoin, etc.

Three Arrows Capital also invests in various forms of platforms, such as exchanges, wallets, lending, oracles, insurance, derivatives, games, etc. Three Arrows Capital's investment portfolio covers all aspects of the cryptocurrency field, demonstrating its deep understanding and extensive participation in the market.

Forward-looking

Three Arrows Capital not only focuses on current market trends and hot spots, but also looks at future market potential and opportunities.

Three Arrows Capital invested in Polkadot, a blockchain network that supports cross-chain interoperability, in 2017. At that time, Polkadot had not yet been officially launched and was just a concept and white paper.

Three Arrows Capital also invested in LUNA (Terra), an algorithm-based stablecoin ecosystem, in 2018. At that time, LUNA was not yet known to the public and was just a niche project. These investments by Three Arrows Capital have demonstrated its foresight and insight into the cryptocurrency field and have also brought it huge returns.

Boldness

Three Arrows Capital not only dares to invest in emerging and unknown projects, but also dares to increase investment and leverage in the face of market volatility and uncertainty.

Three Arrows Capital bought a large amount of Bitcoin on March 12, 2020, a day known as "Black Thursday", when the price of Bitcoin plummeted by nearly 50%, even using 100x leverage, thereby making huge profits in the subsequent market rebound.

Three Arrows Capital also bought a large amount of Ethereum on May 19, 2021, a day known as "Bloody Wednesday", when the price of Ethereum plummeted by nearly 40%, even using 50x leverage, thereby gaining considerable profits in the subsequent market recovery.

These investments by Three Arrows Capital demonstrate its confidence and determination in the cryptocurrency market, and have also won it the respect and awe of the market.

LUNA incident: Three Arrows Capital’s fatal blow

The investment achievements and market influence of Three Arrows Capital made Zhu Su and his team giants and stars in the cryptocurrency field, but also made them a thorn in the eyes and flesh of regulators and competitors. Three Arrows Capital eventually suffered a fatal blow in its investment career, which was the LUNA incident in 2022.

The LUNA incident refers to a serious security vulnerability in the LUNA (Terra) mainnet on September 30, 2022, which resulted in a large number of LUNA tokens being stolen. It also caused the anchoring mechanism of LUNA's stablecoin UST to fail, causing the price of UST to fluctuate greatly, even falling below $0.1 at one point. The impact of the LUNA incident was not limited to LUNA and UST, but also affected the entire cryptocurrency market, triggering a large-scale panic and sell-off, leading to a market crash and bloodshed.

Three Arrows Capital is one of the largest investors in LUNA and one of the largest users of UST. Three Arrows Capital lost billions of dollars in assets in the LUNA incident, and also lost its reputation and position in the market. To make matters worse, Three Arrows Capital was investigated and prosecuted by regulators and law enforcement agencies in multiple countries for its alleged connection with the hackers in the LUNA incident.

Three Arrows Capital was accused of being the mastermind behind the LUNA incident. It used its influence and control in the LUNA network to deliberately create security vulnerabilities, thereby carrying out a premeditated insider trading and market manipulation , obtaining a large number of LUNA tokens from hackers and selling a large number of UST from the market, thereby obtaining huge illegal profits.

Three Arrows Capital denied the allegations, claiming that it was a victim of the LUNA incident, not the mastermind, and had no contact or cooperation with the hackers. Three Arrows Capital also stated that its actions in the LUNA incident were based on normal investment and risk management considerations, and there was no illegal or unethical intention or behavior.

However, these excuses did not help Three Arrows Capital get out of trouble, but instead put it in even greater trouble. Regulatory agencies and law enforcement agencies in many countries, such as the U.S. Securities and Exchange Commission (SEC), the U.S. Department of Justice (DOJ), the Monetary Authority of Singapore (MAS), the People's Bank of China (PBOC), etc., have launched in-depth investigations and reviews of Three Arrows Capital, and even issued arrest warrants and wanted notices, requiring the top management of Three Arrows Capital, especially Zhu Su, to cooperate with the investigation and appear in court for trial.

OX Protocol: Zhu Su’s last stand

Faced with such a grim situation, Zhu Su and his team did not choose to surrender or compromise, but chose to flee and fight back.

Zhu Su and his team used their resources and networks in the cryptocurrency field to successfully evade pursuit and arrest by various countries, while also secretly planning a new project called OX Exchange.

Through OX Exchange, Zhu Su hopes to rebuild his reputation and status in the cryptocurrency field, while also sending a strong signal to regulators and competitors that he will not give up and surrender easily, but will continue to fight for the development and freedom of cryptocurrency.

However, Zhu Su’s plan did not come true, and instead led to his complete downfall. After its launch, OX Exchange was welcomed and appreciated by some users and supporters in the cryptocurrency field, but it also encountered more criticism and resistance, and was even considered a dangerous and evil existence that threatened the legitimacy and security of cryptocurrency.

The main problem with the OX exchange is that it is too paranoid and radical. Not only does it not bring more freedom and rights to users and participants in the cryptocurrency field, but it puts them into more risks and crises, such as fraud, theft, extortion, money laundering, terrorism, etc.

Conclusion

Zhu Su is a controversial and paradoxical figure. His investment achievements and market influence in the field of cryptocurrency have made him a giant and a star, but also a criminal. His story is also a microcosm of the cryptocurrency field, which shows the charm and potential of cryptocurrency, as well as the risks and challenges of cryptocurrency.

Zhu Su's story also provides us with some inspiration and lessons from which we can learn and draw lessons from so as to better understand and participate in the field of cryptocurrency.

Cryptocurrency is an innovative and revolutionary technology and idea that has brought new possibilities and opportunities to the development and progress of human society, but it has also brought new problems and challenges that require us to understand and respond with new perspectives and methods.