Three Arrow Capital's NFT Movement: moved more than 300 NFTs belonging to the now-bankrupt firm

Three Arrow Capital's NFT Movement to a Gnosis Safe wallet was made by Teneo, Starry Night Capital, the investment fund focused on NFTs owned by Three Arrows Capital's (3AC) founders, has moved more than 300 digital collectibles belonging to the now-bankrupt firm. As part of the bankruptcy proceedings Teneo working to recover all of Three Arrows' assets, including the collection of non-fungible tokens.

"Thanks to the cooperation of VincentVan Dough, all Starry Night Capital NFTs, of which VVD is aware, have been accounted for and are in our possession or are being transferred to us," Teneo wrote on Three Arrow Capital's NFT movement. Starry Night was raised by 3AC and pseudonymous investor Vincent Van Dough last summer to collect premium NFTs. Data from a Dune Analytics dashboard suggests the fund spent some $35 million on NFTs last year. It's estimated that Three Arrows Capital spent $21 million building the collection at the height of the NFT frenzy in 2021.

Teneo also said that Van Dough will be assisting it in the eventual sale of the NFTs. It remains to be seen how much the NFTs will sell for. In June, data from the analytics tool DappRadar estimated that the collection was worth less than $5 million. Now, DappRadar pegs the value at just over $3 million. 3AC had sizable exposure to its native algorithmic stablecoin UST as it depegged from the US dollar, costing it nearly $200 million, according to co-founder Kyle Davies. Much of Starry Night Capital's NFT portfolio will now be valued below their last purchase price since ether has dropped over 60%, but Teneo is still likely to recover millions from their liquidation. Analytics company Nansen estimates the portfolio is worth 625 ether, or about $840,000.

According to the firm, the collection move was part of the liquidator's duty of identifying assets and maximizing recoveries on behalf of all creditors. A report from Bloomberg estimated that the Starry Night Capital collection's total value sits at around $35 million. It represents only a tiny fraction of the 3AC's debt of $2.8 billion to its creditors.

The firm's statement on Three Arrow Capital's NFT movement was: "We would like to make clear that VVD [pseudonymous NFT collector Vincent Van Dough] has cooperated with the JLs [Joint Liquidators] to protect the value of these assets for the benefit of all relevant stakeholders and has sought to ensure that no Starry Night Portfolio assets would be disposed of improperly, or without the sanction of the BVI Court if required."

The NFTs being transferred now include Pepe the Frog NFT Genesis, sold for 1,000 ETH (approx. $3.5 million) on October 5, 2021, and Fidenza #718, sold for 240 ETH (around $1.1 million) on Nov. 13, 2021, several Cryptoart NFTs by the artist XCOPY, sold for between $1.4 and $2.3 million in December, and AI-generated Nude Portrait #7 Frame #184 by Robbie Barrat, sold for $1.1 million in ether.

Among them are also a few Cryptoadz — Cryptoadz #5634 (135 ETH) and Cryptoadz #54 (25 ETH) sold in October — Meridian #684 and Meridian #171 (priced at 90 and 80 ETH respectively), and multiple Pudgy Penguins, including Pudgy Penguin #6869, which was sold for 16.9 ETH on Jan. 8, 2022, Nansen detailed in its tweets on Tuesday.

According to the company, their current estimated portfolio value is 625 ETH (less than $840,000 at the time of writing, a much lower valuation than their sale value), based on the 24-hour median price or seven-day price rate where no sales were made in the last 24 hours. The analytics firm pointed out that 89% of the NFTs have low liquidity, with less than 35 sales in the last seven days.