A Crypto Hedge Funds Moves NFTs Worth Millions to a Single Wallet, Prompting Speculation of a Bankruptcy-Induced Fire Sale

A Crypto Hedge Funds Moves NFTs Worth Millions to a Single Wallet, Prompting Speculation of a Bankruptcy-Induced Fire Sale

The biggest question in the crypto industry these days seems to be where in the world SuZhu and Kyle Davies are. Duo, the founder of Singapore-based cryptocurrency hedge fund Three Arrows Capital (3AC), It was reportedly forced to liquidate on June 27, bypassing court proceedings, and its current location remains unknown.

Creditors are currently asking the New York Bankruptcy Court to freeze 3AC’s estimated $ 3 billion in assets. These assets are primarily in the form of cash, cryptocurrencies, NFTs, “It may be transferred or otherwise disposed of.Starry Night Capital, a branch of the 3AC NFT, moved many of its multi-million dollar collections into one wallet last month.

According to open source data Starry Night Capital The account has been transferred to a wallet listed as AEB785. Some of the transfers started on June 14th, two days ago. Financial Times first time report Three Arrows was unable to respond to a $ 670 million loan margin claim.

The new wallet contains some very valuable NFTS, perhaps millions of worth, including works by artists such as Erick Calderon and Mad Dog Jones from ArtBlocks. One Piece by Dimitri Cherniak A slight lack of symmetry can cause so much painWas purchased last October for 800 ETH, or over $ 2 million at the time.

The crypto fund’s venture to NFT peaked in August 2021 and the company partnered with a pseudonym NFT collector. Vincent Vando— —Those who haven’t commented on the scandal so far, even though they remain relatively active on Twitter to launch Starry Night Capital.group Original purpose Raise $ 100 million, which is said to be used to create an NFT education platform, alongside physical galleries in big cities that neither bear fruit.

Over the past year, Starry Night Capital has spent $ 21 million to acquire 457 virtual assets. However, based on recent estimates made by DappRadar using data on the chain, the net worth of holdings transferred to the AEB785 wallet is estimated to be only $ 3.89 million.

According to CoinMetrics researcher Kyle Waters, at one point Starry Night Capital’s collection accounted for 10% of the total volume of SuperRare, the sixth largest NFT platform by market capitalization.

“The new wallet seems to have some connection to other 3AC wallets,” Waters wrote on Twitter. [Over the Counter] NFT block trade? ”

In an ominous move, the UK-based KR1 fund, the only institutional supporter of Starry Night’s holdings, has completely canceled their investment. KR1 purchased $ 5 million in “Class Starry Night Shares” from the Three Arrows Fund Ltd registered in the British Virgin Islands, but it’s unclear if such a company actually exists, CoinDesk report.. According to a recent earnings report issued by KR1, these shares are 100% impaired.

If Starnite’s NFT collection sells out today when cryptocurrency prices soar, most of the work will be significantly less than what it gets.

Total sales related to non-fungible tokens (NFTs) in art segments around the world for the last 30 days from April 15, 2021 to June 15, 2022. According to Statista data.

In addition to freezing the assets of the fund, the creditor is the founder to list the assets of the fund, including managed wallets, bank accounts, cash and digital assets, derivative contracts, securities, accounts receivable, and accounts receivable. I’m asking the court to force you. Company record. A lawyer acting on behalf of the creditors said Zhu and Davis “have not yet begun to cooperate” in the liquidation process. CoinDesk.

The collapse of 3AC, established in 2012, Pongee-style activities This included borrowing from various lending platforms to repay interest on previous loans. The collapse of the fund has hit liquidity concerns and caused a spillover effect across cryptocurrencies. Other companies, such as lending company Celsius, crypto exchange CoinFlex, and digital asset brokerage company Voyager Digital, all traded with 3AC.

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