Last Updated on July 19, 2024 by Usman Javed
The wallet associated with Three Arrows Capital (3AC), which is now bankrupt, recently made an unexpected NFT purchase. This seemingly transaction was the result of a bid placed three years ago that had gone unnoticed — or perhaps was not deemed “recoverable” — by the liquidators handling 3AC’s bankruptcy.
The Missed Bid
A wallet associated with the bankrupt crypto hedge fund Three Arrows Capital (3AC) purchased a Neon Village NFT on July 5 for approximately $59,821. This transaction originated from a bid placed by the defunct hedge fund three years ago.
According to NFT marketplace SuperRare, the bid was for an NFT from the “Ninja Village” collection by artist SeerLight, discreetly submitted on August 21, 2021, by the 3AC wallet, a year before the fund filed for Chapter 15 bankruptcy in July 2022. However, due to an oversight by Teneo — the company managing 3AC’s bankruptcy proceedings — the bid remained inactive until now.
3AC successfully acquired the NFT for 20 ETH, valued at approximately $58,800 at current rates, from its previous anonymous owner, “@anonymoux.” The owner had originally purchased the NFT for 100 ETH, equivalent to about $348,700 at the time, in October 2021. This information was sourced from SuperRare and verified by Etherscan, a blockchain explorer.
Additionally, Arkham Intel, an on-chain analytics platform, identified the purchasing address as belonging to 3AC, a discovery initially made by community member “@0xBriann,” as reported by TheBlock.
Jean-Michel Pailhon, CIO of Grail Capital and former Ledger executive responded to @0xBriann, noting that the ETH used by 3AC for the bid had not been identified as recoverable assets in the liquidation process.
3AC’s Bankruptcy Ordeal
Three Arrows Capital, a formerly prominent cryptocurrency hedge fund based in Singapore, is currently navigating bankruptcy proceedings. At its peak, 3AC managed assets valued at approximately $10 billion. However, the prolonged bear market in cryptocurrencies, exacerbated by Terra’s ecosystem collapse in May of the same year, led to the firm accumulating debts of around $3.5 billion to its creditors.
Following the bankruptcy filing, the auction of 3AC’s NFT collection generated $2.5 million in proceeds. The highest sale was Tyler Hobbs’ Fidenza #725, which fetched $1 million. The funds raised from the auction are expected to be used to settle the firm’s significant debts.
Kyle Davies, co-founder of 3AC, expressed on Twitter that the auction results for the portfolio were highly successful. In contrast, his co-founder, Su Zhu, responded to the sale with a quote from English poet Alfred Tennyson, implying a feeling of loss.
Both co-founders, Kyle Davies and Su Zhu, have been under scrutiny by the Singaporean government since then. Zhu faced arrest and was detained for more than three months starting in September of last year for non-cooperation with investigations linked to 3AC’s liquidation, while Davies evaded authorities in the city-state.
Final Words
3AC’s wallet recently made an NFT purchase. For some reason, before the discovery of this purchase, it went unnoticed in the crypto community.
Frequently Asked Questions
What was the Primary cause of 3AC’s Fall?
The primary cause of 3AC’s collapse was its excessive leverage on long positions across various cryptocurrencies and related derivatives.
What was 3AC Known For?
3AC operated as a master fund, with investments channeled through both offshore and onshore feeder funds.
Who Lost Money in 3AC?
Private investors and companies lost money in 3AC
How much Money did 3AC Lose?
The fund appears to have incurred losses exceeding $3 billion in 2021 and 2022.
Who is Kyle Davies?
Kyle Davies was one of the founders of 3AC.
Does FTX Still Exist?
No, FTX does not still exist.
Why did FTX shut down?
Lack of liquidity and mismanagement of funds led to the demise of FTX.
Who lost Money in the FTX Scandal?
Investors and companies lost money in FTX
