Bankrupt crypto hedge fund (3AC) makes surprise NFT purchase after three years of liquidators monitoring the offering

The wallet, linked to the now-bankrupt Three Arrows Capital (3AC), recently made an unexpected purchase of NFTs. The seemingly unexpected transaction is the result of a bid placed three years ago that went unnoticed — or perhaps not “considered salvageable” at the time — by the liquidators handling 3AC’s bankruptcy.

The failed bid

According to SuperRare NFT MarketplaceThe forgotten auction was for an NFT from artist SeerLight’s “Ninja Village” collection that was quietly submitted on August 21, 2021 by the 3AC wallet, a year before a Chapter 15 Bankruptcy in July 2022However, due to an oversight by Teneo, the company managing 3AC’s bankruptcy proceedings, the offer has remained pending until now.

3AC obtained the NFT on Friday for 20 ETH (around $58,800 at the moment) from its previous anonymous owner, “@anonymoux.” That owner had purchased it for 100 ETH (around $348,700 at the time) in October 2021. This information was found on SuperRare and also confirmed by Etherscana blockchain explorer.

In addition, Arkham Intel’s blockchain analytics platform has identified the address used for the purchase as belonging to 3AC, which was first spotted by a community member named “@0xBriann,” according to TheBlock’s report.

Jean-Michel Pailhon, CIO of Grail Capital and former Ledger executive, responded to @0xBriann on X that the ETH used by 3AC to place the offering was not “considered in the liquidation process as a recoverable asset.”

The 3AC bankruptcy ordeal

Capital of the Three ArrowsA once-thriving Singaporean cryptocurrency hedge fund is currently going through a bankruptcy filing. At its peak, 3AC managed assets worth an estimated $10 billion. However, the relentless cryptocurrency bear market has taken its toll due to Terra’s Ecosystem Collapse in May of that year, leaving the company owing about $3.5 billion to creditors.

After filing for bankruptcy, the 3AC Collection NFT Auction Tyler Hobbs’ Fidenza #725 sold for $2.5 million. The most expensive of the pieces sold was the one that sold for $1 million. The funds raised from the auction will likely be used to pay off the company’s significant debts.

Kyle Davies, co-founder of 3AC, responded to the auction results on Twitter, saying the wallet was “on fire.” His co-founder, Su Zhu, quoted English poet Alfred Tennyson in response to the sale, suggesting a sense of loss.
3AC co-founders Kyle Davies and Su Zhu have since been on the Singapore government’s radar, with Zhu arrested and detained for more than three months in September last year for failing to cooperate with investigations relating to the liquidation of 3AC, while Davies remained at large in the city-state.

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