Oct 11, 2023

Taiwan-based liquidity provider WOO Network has agreed to a deal with Teneo, the liquidator of bankrupt hedge fund Three Arrows Capital (3AC), to repurchase shares and tokens it sold in 2021.

Video transcript

Woo network says it has struck a deal with 10 0 the liquidator of bankrupt Hedge Fund three Os capital to repurchase shares and Tokens it sold in 2021. Joining us. Now to discuss is Wu co-founder Jack Tan. Welcome, Jack. Hi, good to be here. Thank you. So walk us through the steps that you talk that you are taking now to accomplish this, this buyback, I suppose. Um Well, most of the work was done by our legal department. Uh so I can't take any credit for that. Um But dealing with Teneo has been, you know, pretty smooth, I would say they're very professional and um you know, the communication was smooth. Ok. Um Back in 2021 you completed a $30 million series a with the backing with backing for three hours capital among others. Um And how much did did the three ac actually invest at that time? You know, they, they were really um a top brand back then and a lot of projects, one of them on the cap table. And so do we, so, you know, we talked to them, they liked the project like the team and they led the round. Um, I can't disclose exactly how much they came in for. That's not public. Um, but, you know, we were, we're still thankful that they came in. Uh, even after all this had happened. II, I assume you, you bought it back for pennies on the dollar. But I, I, do you have a buyer for it? Well, we are the buyer. Um, I can, are you hoping to turn around and, and maybe use it as a way to fundraise? We're actually sending all the tokens to the burn address. So whenever 10 yo sends us the tokens to a wound owned wallet, uh we plan to burn all of those tokens. And what then now that you, you're doing this presumably, you know, cleaning up the cap table, getting more, sort of perhaps boosting the value of the token. Um What are the next steps? What's your mission now, uh with this behind you? Yeah, like, like you said, I think it was a necessary step uh to clear out the cap table. Uh So that if we do do a future fundraise, um it'll be a much cleaner process and, you know, we will look forward to, you know, do what we've always done, which is, you know, work with our partners and uh ecosystem projects to bring really uh interesting features and products to the market that our users could love. Um I'd love to ask you a larger question if you don't mind. You know, there's been such a string of these high profile collapses, three arrows is definitely one of them. Do you think that the crypto world has learned anything from the three arrows debacle or do you think something like this could just happen again? That's a good question, I think. Um, I mean, we certainly learned a lot from this and, um, it's, it's really hard to understand how much risk, uh, some of these exchanges are taking, some of these investors are taking. And, you know, a lot of the people that we put on a pedestal, um, you know, the similar traits that got them, there are the same traits that, you know, resulted in them blowing up at a later time. Um So it's really hard to judge who are the really top investors and the top players in the industry. You need a lot of time to uh judge a team. Uh, that's, that's definitely one take away from us. Uh And we will keep, um, you know, making sure that our risk management is handled properly. Um, you know, and, and just ensure that, you know, we're going at a steady pace and a and a safe pace, right? Uh I think for crypto exchanges to always be breaking things, um that, that's a very dangerous thing to do, right? So we value the stability a lot more. So. Yeah, so you raise a good point about, you know, three hours a lot of the, a lot of the, I don't know, blame, I guess, collective blame we hear about, you know, people not doing enough due diligence. Um Do you think that's, or just basically pulling the trigger too quickly on investments? But do you think that's the main thing that's needed to prevent something like that this in the future, or do you think there's also like a regulatory aspect or, you know, how do we just prevent the next three hours from, from happening? Is it really something that just really falls on the community and on the investors or do you think there's something larger that needs to happen? If we look at the traditional space, there's tons of regulation, right? Especially after 2008. Um you know, I was working on Wall Street and, you know, a lot of banks were about to blow up and no one can say that they took, um you know, crazy type of risks. Um you know, but things sometimes happen in a systematic way, a systemic way and, you know, it doesn't matter how much regulation there is. Uh you know, people will find a way to take outside risk and then find a way to blow up. Um And I'm not really in favor of um a lot more regulation to try to like handcuff all of these entrepreneurs and risk takers from doing what, you know, is in their DNA. Um I think it's, you know, I think it's on the uh V CS themselves, on the, on the investors themselves to understand, you know, what type of people they're investing in, um kind of their philosophy with investing with risk and what they want to achieve. Right. Uh There's, there's not like the more regulation there is, I think there's less innovation and yes, you'll have blow ups but you also have uh success stories, right. So it's a double edged sword. Um and I'm, you know, more in favor of um lighter regulation. That, that makes sense, right? But I mean, going back to the trad the Wall Street moment, right, the argument for regulation was that it's not just, you know, innocent, uh you know, the investors themselves, specific V CS, large firms that take these big bets that get hurt. There is this thing of systemic risk. And I think one of the things that we really saw in the crypto industry last year was, you know, a uh you know, exhibit a kind of moment of systemic risk. Um And so, you know, whether it's regulation, one of the arguments and you yourself, in one of your answers earlier were talking about the lack of transparency around what these exchanges are doing and the risk exposures of these investors and so forth. Well, we've had a lot of talk that the technology itself could be valuable, right? That there could be proof of reserves and, and all these other mechanisms that might actually bring some transparency if you lean into the technology. So we hear you, you're not up for regulation, but is there an argument to be made for, you know, a more proactive effort from the industry to use Blockchain mechanisms to bring transparency and mitigate systemic risks as a result of that? That's another great question. Um You know, first thing is, you know, there's been a lot of regulation and tried five but people still find ways to blow up. Um There was a huge blow up just last year, right? One of the um ex Tiger Fund managers uh managed to find a way to do that. Um You know, and uh to answer your second part of the question, you know, we've done our part, I think in trying to be as transparent as possible uh by actually putting our balance sheet on our website live and whatever we can use the Blockchain to verify we have done. So, um so I think we are the first company in crypto as well as in traditional to have a live balance sheet updated every 15 minutes for everyone to see. Um It's not about not having regulation, it's having the right regulation I would say. And even without regulation, I think it's even more important for these companies to offer more transparency, right? The less regulation you have, the more transparency you need to offer uh for users to really have a uh like a like a safety uh, safe, safe foundation. Alrighty. Well, thank you Jack. That was Wu co-founder Jack Tan.

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