From $3 Billion to Zero in Just 3 Days — The Fall of Su Zhu
Once celebrated as a visionary in crypto finance, Su Zhu—co-founder of Three Arrows Capital (3AC)—went from managing billions to total collapse in just 72 hours.
The Meteoric Rise:
Su Zhu began as a trader at Deutsche Bank in 2012. By 2021, he was at the helm of 3AC, one of crypto’s most influential hedge funds, known for its bold, high-stakes bets and massive assets under management.
The Fatal Flaw:
Behind the scenes, 3AC was built on reckless leverage. The firm borrowed aggressively—from BlockFi, Voyager, Genesis, and others—stacking debt upon debt to chase outsized gains. The strategy was simple but dangerous: bet big and hope markets never turned.
It Wasn’t Just Their Money:
Zhu’s fund managed:
Capital from billionaires
Assets from other hedge funds
The trust of the crypto elite
All of it was funneled into risky plays—most infamously a $500 million investment in LUNA, which imploded in just two days during the 2022 collapse.
The Domino Effect:
LUNA’s crash triggered a chain reaction:
Bitcoin plummeted
3AC’s collateral vanished
Creditors came knocking
And Zhu? He vanished from the spotlight
Why It Collapsed:
No real risk controls
Excessive leverage
Zero transparency
3AC thrived only in a bull market. Once prices fell, the entire structure collapsed.
The Aftermath:
The fall of Three Arrows Capital stands as one of the largest implosions in crypto history—wiping out billions, destroying trust, and exposing how quickly greed and poor risk management can bring down even the biggest names.
Su Zhu’s downfall is a stark reminder:
In crypto, leverage doesn’t forgive.
