3AC Liquidators to Auction Millions in NFTs: Bored Apes, CryptoPunks, and More Up for Grabs

The crypto world is still reeling from the aftermath of the Three Arrows Capital (3AC) collapse. Remember the crypto hedge fund that was once a giant? Well, their fall from grace continues to send ripples across the digital asset landscape. Now, in a move that’s sure to grab the attention of NFT enthusiasts and market watchers alike, liquidators are preparing to auction off a significant chunk of 3AC’s NFT holdings. Let’s dive into what’s happening and what it means for the NFT space.

What’s Going On with 3AC’s NFT Liquidation?

Teneo, the firm appointed to handle the liquidation of the now-insolvent Three Arrows Capital, has announced its plans to sell off hundreds of NFTs. This isn’t just a few digital collectibles; we’re talking about a portfolio estimated to be worth millions of dollars. This move comes as part of the ongoing efforts to recover assets and repay creditors who are owed billions after 3AC’s dramatic downfall.

Here’s a quick rundown of the key points:

• Who is selling? Teneo, the liquidator for Three Arrows Capital (3AC).
• What are they selling? Hundreds of NFTs from 3AC’s portfolio.
• Why are they selling? To liquidate assets and recover funds for creditors.
• Value of NFTs? Estimated to be worth millions of dollars, with a subset valued around $9.8 million based on floor prices at the time of writing.
• Timeline? Sales process expected to begin within 28 days of the announcement.

Which NFTs are Up for Auction? Expect Some Big Names!

If you’re an NFT collector, you’ll want to pay attention to this. The list of NFTs being liquidated includes some heavy hitters in the digital art world. According to documents, the collections feature NFTs from:

• Bored Ape Kennel Club: Part of the broader Bored Ape Yacht Club ecosystem, these dog-themed NFTs are highly sought after.
• Autoglyphs: Early generative art NFTs, considered historically significant in the crypto art movement.
• Chromie Squiggles: Created by Art Blocks founder Snowfro, these generative art pieces are known for their unique and varied outputs.
• CryptoPunks: OG NFTs that are practically synonymous with digital collectibles, holding immense cultural and monetary value.
• Fidenza: Another Art Blocks collection by Tyler Hobbs, celebrated for its flowing and algorithmic patterns.
• Nimbuds: While perhaps less mainstream than CryptoPunks, they still hold value within the NFT space.
• Ringers: Another popular Art Blocks collection by Dmitri Cherniak, known for its string-based generative art.

Imagine owning a piece from these collections that once belonged to a major crypto fund! It’s definitely a unique opportunity for collectors.

Important Note: Not Starry Night Capital NFTs

It’s crucial to clarify that these NFTs are not from the Starry Night Capital portfolio. Starry Night Capital was an NFT-focused fund launched by 3AC in collaboration with the well-known NFT collector Vincent Van Dough. Their aim was ambitious: to build “the world’s finest collection of CryptoArt.”

However, the Starry Night Capital NFTs are in a different situation. They were moved to a Gnosis Safe in October and are currently subject to legal action in the Eastern Caribbean Supreme Court in the British Virgin Islands. So, the NFTs being sold now are separate from that specific collection.

Why is 3AC Liquidating NFTs Now?

The primary reason is simple: to recoup funds for creditors. When 3AC collapsed, it left behind a massive financial black hole, owing billions to various entities. Liquidating assets, including these valuable NFTs, is a necessary step in the bankruptcy process.

Earlier in December, liquidators managed to seize $35.6 million from 3AC’s Singaporean bank accounts. While this is a significant sum, it’s a drop in the ocean compared to the total debt. Selling off the NFT portfolio represents another avenue to generate capital and partially address the outstanding debts.

What Does This Mean for the NFT Market?

The impending sale of 3AC’s NFT portfolio raises some interesting questions for the NFT market:

• Potential Price Impact: Will a large influx of NFTs from notable collections into the market cause price fluctuations? It’s possible that a sudden supply increase could put downward pressure on the floor prices of these collections, at least temporarily.
• Collector Opportunity: For NFT collectors, this could be a chance to acquire sought-after NFTs, possibly at more accessible prices if the auction environment becomes competitive.
• Market Sentiment: The sale serves as a reminder of the broader crypto market turbulence and the consequences of major players collapsing. It could influence market sentiment, although NFTs have shown resilience in the past.
• Long-Term Value: Despite short-term price movements, the long-term value proposition of blue-chip NFTs like CryptoPunks and Bored Apes remains strong. This liquidation event might be viewed as a temporary market adjustment rather than a fundamental shift in value.

Navigating the NFT Liquidation Landscape

For those interested in potentially participating in the auction or simply observing the market impact, here are a few things to consider:

• Stay Informed: Keep an eye on announcements from Teneo regarding the specifics of the NFT sales process, including platforms and dates.
• Do Your Research: If you’re considering bidding, research the specific NFTs being offered, their historical prices, and current market sentiment.
• Manage Expectations: NFT markets can be volatile. Understand the risks involved and don’t invest more than you can afford to lose.
• Observe Market Trends: Monitor how the NFT market reacts to this news. It could provide insights into market dynamics and investor behavior during liquidation events.

Conclusion: A New Chapter for 3AC’s NFTs

The liquidation of Three Arrows Capital’s NFT portfolio marks another significant chapter in the ongoing saga of the crypto hedge fund’s collapse. While it presents challenges for the NFT market in terms of potential price adjustments, it also opens doors for collectors to acquire valuable digital assets. As Teneo moves forward with the sales, the crypto and NFT communities will be watching closely to see how this unfolds and what it signifies for the future of digital collectibles in the broader financial ecosystem. One thing is for sure: the story of 3AC and its NFT holdings is far from over.