Sam Bankman-Fried, founder and chief executive officer of FTX Cryptocurrency Derivatives Exchange, … [+]
Singapore state-owned investment firm Temasek said Thursday it has decided to write off its $275 million investment FTX, nearly a week after the cryptocurrency exchange filed for bankruptcy.
Once among the world’s largest cryptocurrency exchanges, FTX is helmed by CEO Sam Bankman-Fried, whose net worth peaked at $26.5 billion last year, before plummeting to less than a billion dollars as the company struggled to raise funding to cover as much as $8 billion in shortfall amid massive withdrawals. The firm filed for bankruptcy last week, burning at least 20 billionaires and several institutional investors including Temasek and Sequoia Capital.
Temasek said it had invested $210 million in FTX International and a further $65 million across two funding rounds in October last year and January this year. That’s a small sum compared to the company’s portfolio which was valued at S$403 billion ($293 billion) as of March this year, it added.
“It is apparent from this investment that perhaps our belief in the actions, judgment and leadership of Sam Bankman-Fried, formed from our interactions with him and views expressed in our discussions with others, would appear to have been misplaced,” Temasek said in a statement.
The collapse of FTX is unnerving investors throughout the crypto space and creates chaos for regulators amid reports that customer assets were mishandled and misused at the exchange.
“We expect companies that we invest in to comply with their obligations under the laws and regulations of jurisdictions in which they have investments or operations; abide by sound corporate governance; and above all act ethically always,” Temasek said. “We take corporate governance seriously, engage the boards and management of our investee companies regularly and hold them accountable for the activities of their companies.”