Bankruptcy Three Arrows Capital NFTs To Be Sold – NFT News Today
Teneo, liquidator firm Three Arrow Capital (3AC), acting to oversee the bankruptcy against the Singapore-based crypto hedge fund, has begun receiving NFTs from the group. 3AC filed for Chapter 15 bankruptcy at the end of June. The company owes creditors more than $3 billion, making it one of the largest losses ever by a hedge fund.
Blockchain analytics firm Nansen announced in a tweet that NFTs have been moved to a new wallet. The digital assets were moved from a wallet set up by crypto hedge fund Starry Night Capital, a subsidiary of Three Arrows Capital. to a new Ethereum wallet address. At the time of writing, the wallet contains 464 NFTs.
The first of the NFTs transferred was Pepe the Frog NFT Genesis, which the company bought for 1000 ETH.
NFTs previously collected by Starry Knight Capital are moving to a Gnosis secure address.
These NFTs include:
– Pepe the Frog NFT Genesis, sold 1,000 ETH ($3.5M) on October 5, 2021
– Fidenza #718, sold for 240 ETH ($1.1M) on November 13, 2021Below are some more notable NFTs
pic.twitter.com/8PU13CqMnn
— Nansen
(@nansen_ai) October 4, 2022
Starry Night Capital NFT
Three Arrows Capital (2012) founders Su Zhu and Kyle Davis, along with an NFT collector and trader who goes by the pseudonym Vincent Van Doff, set up Starry Night Capital in August last year. The plan was to raise $100 million in funding. However, it is believed that the collection cost $35 million.
Speaking to The Block at the time, collector Vincent van Doff said, “Our thesis is simple, we believe the best way to gain exposure to the cultural paradigm shift initiated by NFTs is to own top pieces from the most desirable sets.”
To this end, Starry Knights Capital bought some of the highest priced NFTs in the market at the height of the NFT explosion. Things looked good all around.
Then came the crypto winter and the fall of giants like Celsius and Terra.
Three arrows capital liquidation order
Fast forward to mid-2022 and everything starts to fall apart, with a British Virgin Islands court ordering Three Arrows Capital into liquidation.
The story begins in May when Terra Luna and its UST stablecoin begin to self-destruct. At the time, it was rumored that 3AC’s exposure was upwards of $200 million.
A June 17 Wall Street Journal report stated that the founders of Three Arrows Capital have “hired legal and financial experts to work on a solution for its investors and creditors after suffering massive losses due to a broad market sell-off of digital assets.”
Following this, crypto exchanges including FTX and BitMEX canceled margin positions in Three Arrows Capital when the company failed to meet their calls.
More bad news came when Decrypt reported, 3AC defaulted on a loan from crypto lender Voyager Digital, forcing the company to file a default notice. However, by July 6th Voyager Digital had become another victim and filed for bankruptcy and was recently acquired by FTX.
Then, in August, a Singapore High Court allowed the liquidator, Tenio, to extradite the company’s financial records, allowing the company to include and place 3AC with crypto, NFTs, bank accounts and assets currently held in Singapore. their value
Also recovered assets
So far, according to a Bloomberg report, Tenio has recovered about $40 million worth of assets, including the company’s collection of NFTs.
NFT collections amount to only a small percentage of recovered assets as many digital assets have drastically reduced in value. NFT values have dropped significantly from last year, with Nansen valuing the Starry Night portfolio at 625 ETH. A significant depreciation from last year when many NFTs were bought.
Furthermore, Nansen reports that 89% of the portfolio has low liquidity, which adds to the low valuation.
Think later
The ongoing crypto winter has brought some major losses to NFT collectors and crypto investors in general. From the dizzying heights of last year’s boom, we’ve seen a 97% drop in NFT trading volume.
The loss of a major player like hedge fund Three Arrows Capital, its exposure through the Terra disaster and the subsequent domino effect, once again shows the wild west nature of investing in this new technology.
Sometimes, even doing your due diligence at times isn’t enough. Always stay abreast of the latest news and developments on any project that interests you. The crypto world is a fast and ever-changing place.
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