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    Singapore’s Temasek writes down $275 million in FTX, calls belief in Sam Bankman-Fried ‘misplaced’- HindiNewsWala




    New Delhi
    CNN Business
     — 

    Singapore has become the latest backer of crypto exchange FTX to admit being burned by its spectacular collapse.

    In a statement on Thursday, state-owned investment company Temasek said it had decided to write down the value of its full investment in the exchange to zero, “irrespective of the outcome of FTX’s bankruptcy protection filing.”

    Temasek said it had invested $275 million in the crypto exchange, which was once considered one of the biggest and most reputable players in the market for digital assets.

    Its sudden downfall has stunned investors and customers, and triggered a cascade of wide-reaching effects in the industry. FTX Group abruptly filed for bankruptcy in the United States last Friday when its founder, Sam Bankman-Fried, resigned as CEO.

    Temasek said it had poured in $210 million for a minority stake of about 1% in FTX International, and $65 million for a minority stake of about 1.5% in FTX US, across two funding rounds from October 2021 to January 2022.

    This “write down of our investment in FTX will not have significant impact on our overall performance,” Temasek said in the statement. The investment company also gave details of its due diligence processes on FTX, which took approximately eight months.

    FTX is now under criminal investigation in The Bahamas, where it had moved its headquarters last year from Hong Kong.

    “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,” it added, referring to the 30-year-old founder of the exchange.

    Before its implosion, FTX was valued at $32 billion and had recruited high-profile backers including SoftBank and Tiger Global, as well as celebrities such as Tom Brady, Gisele Bündchen, and Naomi Osaka. Now, they are running for cover. Last week, investor Sequoia Capital said it had marked the value of its FTX stake down to $0.

    Legal headaches are also piling up this week. An FTX investor has sued Bankman-Fried as well as several celebrities who had endorsed the platform, including Brady and Bündchen.

    The contagion is spreading across the vast crypto and digital-asset ecosystem.

    On Wednesday, the lending arm of crypto brokerage Genesis suspended redemptions and new loan origination after an “abnormal” number of withdrawal requests that exceeded its current liquidity, citing market turmoil from the failure of FTX.

    Last week, crypto lending platform BlockFi said it was pausing customer withdrawals.



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