- 3AC founders have teamed up with Coinflex’s founders to raise money for a new crypto exchange.
- The crypto industry welcomed the new venture with considerable criticism.
Su Zhu and Kyle Davis, the men behind Three Arrows Capital (3AC)), the defunct crypto hedge fund whose collapse triggered an industry wide string of bankruptcies, have joined hands with Coinflex co-founders Mark Lamb and Sudhu Arumugam to launch a new exchange.
3AC founders looking to raise $25 million for GTX
According to a pitch deck, the new venture is a crypto exchange called GTX. The founding team pitched it as cross asset trading on a public marketplace. The objective of GTX is to tap the $20 billion crypto claims market and turn it into a tradable instrument in a public marketplace. The platform would let users use the claims against bankrupt firms in the crypto space as collateral for trading.
Su Zhu and his new partners are looking to raise $25 million for GTX. However, this looked like an attempt to capitalize on the fallout from FTX’s collapse. Additionally, the fact that FTX users are selling their claims at 10% of the face value raised doubts about the new venture.
The pitch read:
“Our legal team will streamline and automate claims onboarding to GTX and make it the dominant marketplace for FTX and other bankrupt companies’ claims.”
Crypto twitter skeptical of GTX
The GTX exchange was being pitched by people who were essentially at the helm of failed businesses in the past. Thus, the public remained skeptical of the new exchange pitched. Paired with the fact that many on crypto twitter are direct victims of 3AC’s risky business conduct, the criticism that followed was quite stark.
Individuals apart, even fellow firms in the crypto space moved to distance themselves from this new venture. Crypto market maker Wintermute was among the first firms to criticize GTX. CEO Evgeny Gaevoy tweeted that his firm would not be investing in any projects affiliated with 3AC’s founders.
And since we are talking about cancelling stuff, if you are investing into coinflex/3ac "exchange" you might find it a bit more difficult to work with wintermute in future (on the relationship building side)
— wishful cynic (@EvgenyGaevoy) January 16, 2023
