Sotheby’s, the prestigious auction house known for selling one-of-a-kind art pieces, has recently concluded its sale of several rare non-fungible tokens (NFTs) seized from bankrupt crypto hedge fund Three Arrows Capital’s (3AC) collection, bringing in a total of $2,482,850. This move was made to recoup some of the funds lost when 3AC filed for bankruptcy in July.
The Grails Collection, formed by 3AC as part of its asset portfolio primarily in 2021, was the centerpiece of the auction. Sotheby’s describes the NFTs in the collection as “some of the most significant digital artworks ever assembled.” The meticulously selected collection showcases the works of four leading artists who are pushing the boundaries of contemporary algorithmic art, according to Sotheby’s catalog description.
The NFTs that were on the auction block included generative art pieces like Tyler Hobbs’ Fidenza #725 and Dmitri Cherniak’s Ringers #375, as well as Larva Labs-created Autoglyph #187 and CryptoPunk #1326. In total, there were seven generative artworks on offer. More NFTs from 3AC’s collection will be released in chapters through auctions or private sales in the future.
The highest-priced NFTs from the Grails collection included Fidenza #725 and Autoglyph #187. The former was estimated to sell for $120,000-$180,000, but sold for $1,016,000. The latter was estimated at $120,000 to $180,000, but ended up selling for $571,500.
Valuing NFTs can be a challenge, but a machine learning tool called Deep NFT Value estimates high-value NFTs by exploring previous sales of the digital assets, current market conditions, and the unique rarity traits of each collection. According to Deep NFT Value, Fidenza #725 was worth 184.4 ETH, or about $335,000, while Autoglyph #187 was estimated to be worth 205.7 ETH, or about $373,800.
It is interesting to note that Sotheby’s tends to underestimate the value of these NFTs, possibly to spark more interest and encourage a robust bidding process. “My understanding is that the estimates are meant to be low so that they get beaten,” said Nikolai Yakovenko, CEO of Deep Value NFT, in an interview with CoinDesk. “In the case of the Ringers and Fidenzas, [Sotheby’s] are making an estimate perhaps above the operating floor price, but well below the premium they expect.”
Sotheby’s upcoming NFT sales are not related to Starry Night Capital’s impressive NFT portfolio, which was set up by 3AC in partnership with well-known NFT collector Vincent Van Dough in August 2021. The recent auction of the Grails Collection serves as a way for 3AC’s creditors to recoup some of the lost funds.
The surge in NFT popularity has been nothing but astounding, with sales skyrocketing in recent years. As a result, investors and collectors worldwide are rushing into the space in hopes of owning a piece of digital art history. NFTs are seen as a means to encapsulate artwork or even tweet into digital form, making it easily verifiable and authentic.
However, the downside to the NFT craze is that the market can be volatile and unpredictable. According to a recent report by NonFungible.com, the NFT market has seen a significant dip in sales over the past few months, following its rapid increase in the first six months of the year.
Nevertheless, NFTs remain a hot topic of discussion among collectors and investors alike. Sotheby’s, known for its expertise in all things art, seems to be embracing the trend, launching its On-Chain Secondary NFT Marketplace, which will be the first-ever curated NFT marketplace to be integrated into a traditional auction platform.
In conclusion, the recent Sotheby’s sale of NFTs from 3AC’s collection serves as another instance of the growing popularity of NFTs. While it’s unclear what the future holds for the NFT market, collectors and investors are undoubtedly keeping a close eye on the industry and the potential it holds. The NFT era seems to be only getting started, and it’s exciting to see what innovative pieces of digital art will emerge from this trend.