The founders of the controversial Three Arrows Capital (3AC), Su Zhu and Kyle Davies, have been issued a written reprimand by the Dubai Virtual Assets Regulatory Authority (VARA) after allegedly promoting and operating a new crypto exchange called OPNX without adequate licensing.

The VARA was established as the sole authority regulating all digital asset trading activities in the country. However, the OPNX exchange allegedly failed to get the required operating license.

3AC Founders In The Spotlight Again After Previous Hedge Fund Collapse

Su Zhu and Kyle Davies, co-founders of the failed 3AC crypto hedge fund, have gained the Dubai regulator’s attention after disregarding the required local license to operate its new exchange OPNX.

As reported on Bloomberg, the issued written reprimand by VARA to the co-founders came after a two-time cease-and-desist operation notice to the OPNX exchange.

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The first cease and desist notice order to OPNX exchange sent on February 27 was followed by another on March 10, 2023.

However, it was noted on the report that the OPNX exchange failed to comply with the notices by proceeding to launch and start trading operations on April 4, 2023.

After the compliance breach, VARA was reported to have issued an “Investor and Marketplace Alert” regarding OPNX to inform users of the platform’s non-compliance problems.

Still, on the report, VARA also made statements regarding its continuing investigation of OPNX activity “to assess further corrective measures that may be required.”

Su Zhu And OPNX CEO, Leslie Lamb Gives Response

The 3AC founder, Su Zhu, and OPNX CEO recently responded to the recent developments leading to the reprimand issued by the Dubai regulator.

According to Bloomberg, it was reported that Leslie Lamb, CEO of OPNX, said that the trading company, OPNX, “has not done any marketing and promotions targeting Dubai or the wider UAE” and that OPNX is currently cooperating with VARA investigations.

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The report also added that Leslie Lamb said in a Whatsapp message that “At no point in time have UAE customers been able to open an account on the OPNX.”

Leslie Lamb also holds the conviction that the trading platform and exchange, OPNX, has not violated any rules whatsoever.

3AC founder Su Zhu was also reported to have made a statement in a separate message saying, “While Kyle and I helped contribute to the ideas for OPNX, Leslie is very much the CEO, and we aren’t involved in the day-to-day.”