Three Arrows ‘ CryptoPunks and Other ‘Starry Night’ Ethereum NFTs Are Being Liquidated

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Last Updated on October 6, 2022 by Bitfinsider

After expensive Ethereum-based NFTs belonging to crypto hedge fund Three Arrows Capital were transferred to a new wallet this week, the liquidator in charge of the firm’s bankruptcy proceedings confirmed that the collection has been taken custody of.

Teneo, the business advisory firm in charge of the Chapter 15 bankruptcy process, announced in a statement that it now has possession of the NFTs owned by Starry Night Capital, a fund founded in 2021 by Three Arrows Capital and pseudonymous investor Vincent Van Dough. Over the last two days, the majority of the assets were transferred to the new wallet.

All of Starry Night Capital’s NFTs “have been accounted for and are in our possession or are being transferred to us,” according to the liquidator. Teneo credited Vincent Van Dough with facilitating the transfer and ensuring that the NFTs were not sold outside of the liquidation process. Teneo also stated that the fictitious collector will assist the firm in selling the NFT collection in order to cover Three Arrows Capital’s losses.

Three Arrows Capital, a well-known crypto hedge fund, went bankrupt in May following the collapse of Terra’s UST and LUNA ecosystems, in which the firm had a significant stake. Three Arrows Capital founders Su Zhu and Kyle Davies said other recent bad bets, such as staked Ethereum and the Grayscale Bitcoin Trust, were also a factor.

Three Arrows filed for Chapter 15 bankruptcy in June, claiming that it owed creditors $3.5 billion as a result of its demise. In August, Singapore’s high court authorized a more thorough investigation into the firm’s demise.

Starry Night Capital, a hedge fund, was announced in August 2021 as the NFT market reached new heights, with plans to raise up to $100 million to purchase and hold high-value NFTs. The fund was announced at the same time as its purchase of an Art Blocks Ringers NFT from Dmitri Cherniak for $5.66 million in ETH.

The collection grew to include a variety of other Art Blocks NFTs, as well as CryptoPunks, Rare Pepes, and other valuable pieces. According to an incomplete list of Starry Night’s holdings on data platform Dune, the company spent at least $35 million on NFTs in 2021.

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