Andrew Kang purchases original Pepe NFT from 3AC estate in Sotheby's sale

Mechanism Capital co-founder Andrew Kang purchased the original Pepe the Frog NFT from the estate of bankrupt crypto hedge fund Three Arrows Capital, known as 3AC, for an undisclosed sum.

Auction house Sotheby's facilitated the private sale as part of the liquidation of 3AC's remaining NFTs. Sotheby's confirmed the sale to The Block and onchain data shows it has been moved to Kang's wallet.

The NFT was the first Pepe one authorized by the character's creator, Matt Furie. It shows a full-page scan from Matt Furie's Boys Club comic series showing the "feels good man" meme.

The NFT was first sold for 420 ETH (around $1 million at the time) on April 17, 2021. It was then acquired by Starry Night Capital for 1,000 ETH, worth $3.5 million at the time, on October 5, 2021. Starry Night Capital was an investment arm of 3AC focused on the NFT market.

3AC collapsed in June 2022 and filed for bankruptcy the next month. It had been impacted by the collapse of crypto exchange FTX and the failed stablecoin UST and its sister token luna. Its collapse caused a cascading impact on other crypto firms around it, resulting in serious issues for crypto prime brokerage Genesis and crypto exchange Gemini. These two firms are now being investigated by the NYAG over an alleged cover up of the missing funds.

Kang's NFT collection includes 50 Azukis, a Fidenza, three Bored Apes, 11 Mutant Apes and 6 CryptoDickbutts. Dappradar estimates the value of the NFTs in his wallet at $6.69 million.