The recent crypto market crash did not go well in many terms, where insolvency of major crypto firms like Three Arrows Capital are most tragic
When the chaos of the crypto market settles down, maybe the loss will be more than just monetary value. Longer the crypto winter will stay, the more losses companies and firms across the industry have to suffer. This may also end up diminishing some prominent firms in the crypto space like Three Arrows Capital, which reached on the brink of insolvency given the extreme market conditions.
The market crash has affected almost every other sector, every prominent entity across the space including top cryptocurrencies, non-fungible tokens, not just DeFi but CeFi had to suffer and not even the hedge funds were spared by it. Three Arrows Capital turned out to be one such effective example, where the hedge fund with about $10 billion worth of assets under management (AUM) once and is now on the verge of collapse.
It has been almost a week for Three Arrows Capital to file for bankruptcy in the New York State and now it has come to its NFT holdings. Reportedly, in order to liquidate the prominent hedge fund, now it will soon be the turn of its stock of blue chip NFTs. Analytics reported sourcing out publicly available data stated about Ethereum network holdings in addresses belonging to Three Arrows Capital.
These assets in 3AC holdings include about a dozen CryptoPunks, lots of ArtBlocksCurated worth approx $2.5 million, Chromie Squiggles, Autoglyphs, Mutant Apes and also a Bored Ape. Out of this whole stash of NFTs in hedge funds’ holdings, the most valuable collection is CryptoPunks whose value is at around $3 million. Overall the entire NFT collection holding of 3AC is about $7 million, according to their present value.
Further it was also noted that these wallet addresses are also holding stablecoins other than NFTs and since 21st June, there have been no transactions recorded on the wallet.
More or less, this decline in value of most crypto firms in the space started after the collapse of Terra (LUNA) network due to de-pegging of its algorithmic stablecoin UST. This instance created a ripple effect across the broader crypto space that resulted in unravelling the leverage of crypto firms all over the industry. It is because of the same incident that firms like Three Arrows Capital failed to take safety measures on time.
Source: https://www.thecoinrepublic.com/2022/07/05/the-liquidation-of-three-arrows-capital-will-swallow-millions-worth-of-its-nfts-holdings/