Starry Night Capital, a subsidiary of bankrupt crypto hedge fund Three Arrows Capital, is moving its cherished NFT collection to Teneo, Three Arrows’ court-appointed liquidator.
Starry Night Capital launched last summer with backing from Three Arrows. Famed NFT collector Vincent Van Dough was brought on as a partner and curator of the collection.
In a notice to Three Arrows’ investors, Teneo credits Van Dough for his cooperation. An email to Van Dough’s Starry Night account was returned as undeliverable Tuesday, a day after The Defiant first inquired about the recent transfer of several NFTs in the Starry Night collection.
NFTs moved from the Starry Night collection to a Gnosis multi-signature wallet controlled by Teneo include several from the Pudgy Penguins, Fidenza and CryptoKitties collections.
“In an effort to preserve as much capital as possible VVD has offered to assist with the eventual sale of all 3AC NFTs and will likely be working with us to oversee the disposal of these assets,” Teneo said in its letter to investors.
In June, Starry Night moved much of the multimillion-dollar collection into a single wallet, prompting speculation of an upcoming fire sale to cover massive losses incurred by Three Arrows during this bear market.
If the collection were sold, Starry Night would likely incur heavy losses, Coinmetrics researcher Kyle Waters pointed out in June. Most of the pieces were acquired last summer and fall, during crypto’s bull run. Prices have cratered since, meaning the fund would likely have to sell its art for a fraction of what it took to acquire.
Waters estimated the firm had spent $21M to amass its collection. In fact, the fund has accounted for one out of every ten dollars spent on NFT marketplace SuperRare, the researcher said. That’s a drop in the bucket, however, compared with the billions Three Arrows Capital was estimated to manage.