Tech, Crypto and Start-ups: Latest Updates 2022
On the Flip Side, the Tech World is Bustling
Imploding Crypto: FTX
Early in November 2022, the cryptocurrency exchange FTX went down after a CoinDesk story highlighted potential leverage and solvency issues with trading firm Alameda Research. A liquidity crisis forced FTX to look for bailout money, and rival exchange Binance briefly explored purchasing some of the business before withdrawing. On November 11, 2022, FTX’s CEO resigned and the business declared bankruptcy. In the hours that followed, FTX may have been the victim of a hack in which tokens valued at hundreds of millions were taken.
The enormous amount of venture capital the cryptocurrency exchange was able to raise and the calibre of investors it attracted are two intriguing facets of FTX’s downfall, among many others. In just two years, FTX raised a total of $1.9 billion from 80 investors. The cap table of the now-bankrupt company resembles a ranking of the top hedge funds, private equity firms, and venture capital firms in the globe.
Others who have invested in FTX and FTX US include Sequoia, SoftBank, Tiger Global, Temasek, Ribbit Capital, and Blackrock; some as recently as January 31, 2022.
Sequoia then gave FTX a $210 million investment. On November 11, the Japanese giant disclosed that it has invested just under $100 million in FTX through its Vision Fund 2. Similar to Sequoia, it has since written off the investment.
The Ontario Teachers’ Pension Plan, one of the biggest pension plans in the world with approximately $242.5 billion in assets under management, invested $75 million in FTX in October 2021. It made an additional $20 million investment in January 2022. It said this week that it was zeroing out its $95 million investment.
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