Sotheby’s Is Selling an Eye-catching Set of Blue-Chip NFTs from the Collection of Failed Crypto Hedge Fund Three Arrows Capital
Auctions
The auction is the first in a series to sell the company’s digital assets.
Aside from losing billions of dollars and arguably kicking off a crypto winter, cryptocurrency hedge fund Three Arrows Capital also backed a plush portfolio of NFTs, one that founders Su Zhu and Kyle Davies thought would look pretty lit in the gallery of their proposed $50 million. superyacht Much Wow.
After the Singapore-based fund went bankrupt in July 2022, advisory firm Teneo, Three Arrows Capital’s liquidator, has been tasked with recovering funds through the sale of NFTs held by the company.
On April 19, Sotheby’s announced that it would host the first part of its “Grails” process, an auction of nine blue-chip generative digital works that will form part of the auction house’s contemporary and modern art sales tent from the 6th to the 20th .May.
Dmitri Cherniak, Caller #879 (2021). Photo courtesy of Sotheby’s
“We chose to partner with Sotheby’s digital art team because we believe they have a best-in-class approach that will ultimately maximize the value of these assets on behalf of all creditors,” Teneo said in a statement to Artnet News. The collapsed crypto fund still owes creditors about $3.5 billion.
Established in 2012, Three Arrows Capital has backed a number of high-profile projects, including BlockFi and Polkadot, with the founders being brilliant maverick investors. As Zhu and Davies became crypto-Twitter celebrities, they began amassing an NFT collection worthy of their lofty status. Part of this endeavor involved partnering with renowned NFT collector Vincent Van Dough to launch the Starry Night Capital fund, which promised to assemble “the world’s finest collection of crypto art.”
Although NFTs from the so-called Starry Night portfolio will not be on the auction block given ongoing complications surrounding their ownership, the works being sold at Sotheby’s are indeed works befitting the show title “Grails”, which in NFT parlance refers to works of historical meaning that will hold value.
Larva Labs, CryptoPunk #6649 (2020). Photo courtesy of Sotheby’s.
It is Caller #879 from Dmitri Cherniak’s series where the artist developed 1000 works that capture the infinite ways a string can move around pegs, varying the number of pegs, size, winding pattern and colours. There are a couple Fidenza works from Tyler Hobbs’s randomly generated flow field consisting of warped rectangles. It’s a trio of Sol LeWittt-inspired Autoglyphs works from Larva Labs, with the zombie-like CryptoPunk #6649 thrown in for good measure.
“This expansive collection marks an important moment in the emergence of generative art on the blockchain in 2021,” said Michael Bouhanna, Sotheby’s Head of Digital Art and NFTs. “Since that defining moment, when digital art and NFTs became a true pop culture phenomenon, generative art has continued to gain attention from a growing audience.”
Although neither Sotheby’s nor Teneo was willing to offer a sale estimate, the timing of the sale, along with the rarity of the works on offer, has the potential to raise millions of dollars.
In February 2023, Teneo published a notice showing the company’s NFTs. More than 300 NFTs were marked green and subject to sale, including 30 of Hobbs’ Fidenza17 of Cherniak’s Ringerand 11 CryptoPunks. Expect a number of sales to roll through the summer.
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