A collection of unique digital assets known as non-fungible tokens (NFTs) previously purchased by the now-bankrupt cryptocurrency hedge fund Three Arrows Capital fetched an impressive $10.9 million at the recent Sotheby’s auction in New York. The auction house revealed the sale results on Thursday.
According to data from blockchain tracker DappRadar, Three Arrows Capital, which filed for U.S. bankruptcy a year ago, had originally spent approximately $15.5 million worth of cryptocurrency to acquire these 37 NFTs during July and August 2021.
NFTs represent ownership of various digital items like images, videos, or texts on the blockchain. The highest-priced item in this collection, titled “Ringers #879 (The Goose),” is one of a series of 1,000 abstract computer-generated images created by Canadian artist Dmitri Cherniak. It was sold for $6.2 million at the auction, surpassing its previous purchase price of around $5.9 million by Three Arrows Capital in August 2021, as per DappRadar.
Michael Bouhanna, the head of digital art and NFTs at Sotheby’s, commented on the growing interest in NFTs, stating, “We see a growing interest and more non-crypto, non-NFT collectors starting to really understand the quality and why it’s interesting.”
Although NFTs exist solely in digital form and can be viewed online by anyone for free, many of the items in this auction were accompanied by physical print copies, allowing buyers to display them as tangible assets, Bouhanna added.
Three Arrows Capital, based in Singapore, became one of the first major crypto firms to declare bankruptcy in 2022, following the collapse of cryptocurrencies Luna and TerraUSD.
The NFT market experienced a massive surge in 2021, fueled by rising cryptocurrency prices and the belief among technology enthusiasts that digital assets would become highly valuable in virtual environments. However, the speculative frenzy has since cooled down, with NFT sales amounting to around $675 million in May 2023, a significant drop from the peak of $5.7 billion in January 2022, according to DappRadar data.
It’s worth noting that Seven of Three Arrows Capital’s NFTs had already been sold for $2.5 million in a previous Sotheby’s auction held in May.