Three Arrows Capital liquidator will sell off the firm’s NFTs to make up for the $3.5 billion it owes creditors

In a notice published Wednesday, the liquidator, Teneo, said the process of offloading the bankrupt firm’s NFTs would begin after March 23 as part of a bid to recoup the $3.5 billion it owes to creditors.

Although the notice did not name the NFTs that would be sold, Tom Wan, a research analyst at 21Shares parent company 21.co, said it could include high profile NFTs like CryptoPunks, as well as a Bored Ape, and a couple of Mutant Apes.

3AC Liquidator, Teneo announced they will be selling their NFT Holdings (Excluding the Starry
Night Portfolio)

Potential NFTs Being Sold:
– 11 Punks
– 1 BAYC
– 2 MAYC
– 3 Otherdeeds
– 3 Autoglphys
– 8 PEGZ

Teneo & 3AC NFT Portfolio @DuneAnalytics :https://t.co/J5DK1KQFhH

— Tom Wan (@tomwanhh) February 23, 2023

The notice did specify that non-fungible tokens in Three Arrows’ Starry Night Portfolio of digital collectibles would not be sold as they are subject to a claim in the Eastern Caribbean Supreme Court in the British Virgin Islands. 

The Starry Night Porfolio was created by Three Arrows Capital founders Kyle Davies and Su Zhu in 2021 when NFTs skyrocketed in value. The fund behind the portfolio, Starry Night Capital, once aimed to raise $100 million, and was able to accumulate NFTs from collections such as Rare Pepe, Fidenza, CrypToadz, along with works from NFT artist XCOPY, according to The Block. 

In October, Teneo moved about 300 of the Starry Night Portfolio NFTs worth around 625 Ether, or $1.03 million, to a Gnosis Safe that requires multiple signatures to move the assets.

The news comes as Three Arrows’ bankruptcy proceedings near their eighth month. The firm declared chapter 15 bankruptcy in early July to protect its U.S. assets while it undergoes a liquidation of its assets in the Bahamas, Bloomberg reported at the time. 

At its peak, Three Arrows’ managed an estimated $10 billion in assets, but it was among the first major crypto firms to declare bankruptcy last year after it was hit hard by the collapse of the stablecoin TerraUSD and its sister cryptocurrency Luna. 

The firm’s collapse rippled across the crypto ecosystem, damaging other notable companies like Genesis Global Trading, which it owes $2.3 billion. 

Meanwhile, the firm’s disgraced founders, Davies and Zhu are trying to raise $25 million to fund a new crypto exchange called GTX that would try to profit from the increasing number of crypto bankruptcies.

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