How FTX Missed a Potentially Lucrative Opportunity

The task of navigating the bankruptcy of FTX, the cryptocurrency exchange where Sam Bankman Freed went bankrupt, has always proved more complicated. Latest evidence: A potentially lucrative missed opportunity has been revealed after FTX offloaded warrants to buy an unnamed crypto token.

The token, called “Sui,” made its trading debut on May 3. It is now run by restructuring expert John Ray III, who has recovered billions of dollars for creditors who fell victim to the massive bankruptcies of Enron, Fruit of the Room and Nortel Networks. FTX sold Sui’s warrant just before the token started trading.

Had FTX exercised its warrants, it would have had over $1 billion in assets as of this morning, even after a 75% drop since it opened last week.

This is what happened to Sui.

  • FTX invested about $101 million in Mysten Labs last year. Misten had built a blockchain platform called Sui that relied on technology developed for Diem, a Facebook-discontinued cryptocurrency project. Mysten has attracted investors such as his Silicon Valley venture capital firm Andreessen Horowitz and cryptocurrency exchange Coinbase, which at one point pushed its valuation to around $2 billion.

  • FTX led the fundraising last summer. That ownership included warrants for 890 million Sui crypto tokens that could be exercised after the launch of the Sui platform. However, FTX went bankrupt a few months later.

  • In March, FTX asked the bankruptcy court for permission to sell its ownership of Mysten for approximately $96 million.

  • in April, the transaction was completed. On May 3, the Sui token started trading and its price skyrocketed. Sui was trading at $1.13 this morning.

With a growing list of creditors, FTX is racing to collect every penny. Bankman-Fried himself says that given enough time, he could find valuable assets in his vast empire and start paying back his customers and investors.

Last month, the IRS filed a “priority” tax claim worth about $44 billion against FTX properties and its sister firm. CoinDesk Report.

FTX has already found billion dollar creditors. “Things have stabilized and the dumpster fire has gone out,” a lawyer for the company told a bankruptcy judge last month, revealing recovery. over $7 billion.

However, within the virtual currency community on Twitter, chuckle That FTX missed a big opportunity with Sui.

A leading investment advisory firm has made a U-turn from Jamie Dimon’s paycheck. Institutional Shareholder Services advised JPMorgan Chase & Co. shareholders last week to oppose compensation plans for the bank’s CEO and other executives. changed my mindand an error in the analysis. It’s a surprising reversal for ISS, which also opposed JP Morgan’s salary policy last year.

SoftBank posted a record loss of $32 billion at the Vision Fund. of Japanese conglomerate focus on technology investment vehicle missed the broader rally in stock prices. The bleak news comes as SoftBank founder Masa Son says the company is halting new investments and focusing on his IPO of its chip designer Arm. .

Disney cuts streaming loss. The media giant said it would start bundling Hulu content on its Disney+ app, citing cost savings and improved subscription pricing. However, it will also start removing some content from its streaming platform to save on paying the remaining balance.

George Santos has pleaded not guilty to 13 counts of fraud. The first-term Republican congressman from New York has been indicted on charges of wire fraud, money laundering, theft of public money, and misrepresenting federal disclosure documents. But Speaker Kevin McCarthy said Santos could remain in Congress pending the outcome of the trial.

Shares of Carl Icahn’s public investment vehicle plunged 15% Wednesday after it was revealed that federal prosecutors in Manhattan demanded documents following allegations by Hindenberg Research for a short sale.

But Icahn, an 80-something billionaire known for his decades-long career of actively rocking companies, made it clear he wouldn’t go down without a fight.

wrap up: Hindenberg, who profitably bets on corporate stock declines, reported last week that Icahn Enterprises operates a “Ponzi-like economic structure” by paying disproportionately large dividends from stock sales. said. Short sellers also said the company is fundamentally overvalued.

The accusations have had a major impact, with shares of Icahn Enterprises down 40% since Hindenburg released the report. This also hits Icahn directly, as most of Icahn’s stock (84% of what he owns) is pledged as collateral for bank loans.

Mr. Icahn removed his gloves, Hindenberg calls himself a peddler of “a disinformation campaign to distort a company’s image, damage its reputation and rob retail investors of their hard-earned savings.” “Unlike many victims, we are not going to stand by and do nothing,” he added.

Icahn Enterprises, meanwhile, said in a securities filing that federal prosecutors have not accused the company or Mr. Icahn of wrongdoing and are cooperating with the investigation. Hindenburg himself has not accused either of them of fraud.

But Mr. Icahn is also changing his strategy. He attributed his company’s poor performance to betting on the stock market and said he would focus more on shareholder activism, the investment strategy that made Icahn a billionaire.

Speaking of which, proxy advisory firm Glass Lewis told investors approve two of his candidates For Illumina boards.

For months, Google has preached a more cautious approach to artificial intelligence, while rivals and the public have embraced ChatGPT and other emerging technologies as harbingers of the future.

But at its annual developer conference on Wednesday, the Silicon Valley giant said it’s looking to adopt technology that could erode its highly profitable business in the hands of competitors, prompting a slew of AI. announced a product that incorporates

Search was the star of the show. Google wanted to talk about its long-awaited core service revamp in hopes of recapturing the buzz Microsoft generated when it announced ChatGPT-enhanced Bing in February.It has been updated Search engine It incorporates AI-generated results and allows users to ask follow-up questions. (But note that it’s not a chatbot.)

Twenty other Google products, such as Gmail, are also AI-powered to help automate tasks for users. But perhaps more importantly, the company revealed research on more powerful AI models, including what it calls his PaLM2. This could potentially power an even broader and more sophisticated set of services.

“We are at an exciting tipping point.” Google CEO Sundar Pichai said Wednesday: But his longtime warnings against the hasty adoption of AI remained, especially wary of products spewing false or misleading information. The new search engine has clearly labeled its AI aspects as “experimental,” and you need to sign up for the Search Labs service to access it.

That said, investors liked what they saw: Shares of Google’s parent company Alphabet climbed 4% on Wednesday, boosting market value $56 billion.

donald trumpA leading Republican presidential candidate, he urged his party to take a tough stance in negotiating cuts to the federal budget, even if it ultimately sent the country into default.

Political debates over an investment approach known as ESG (short for Environmental, Social and Governance Issues) took place across the country on Wednesday as battles that had largely been waged in state capitals carried over to Congress.

From the outset, the House Oversight Responsibility Committee hearings were controversial, as Republican and Democratic lawmakers sparred with witnesses and with each other.

Republicans call ESG an “undemocratic tax” on Americans, It aims to force the adoption of climate-focused policies, which will drive up costs for many. Witnesses at the hearing included attorneys general from Alabama and Utah, who oppose using state retirement funds for his ESG-based investments.

For Utah Attorney General Sean Reyes, ESG is:an open conspiracy Bypassing Congress and instead imposing costly changes on American consumers,” said unelected financial institutions like BlackRock, who include climate change concerns in many investment decisions. We are promoting.

Alabama counterpart Steve Marshall argued that a focus on ESG would lead to higher energy prices.

Democrats defended ESG as just another investment strategy. Illinois State Treasurer Michael Frerichs said opposition to the concept was a “broad, highly coordinated and politically motivated attack” against investors and the average American, saying that ESG is simply risk and opportunity. is just another way of weighing the

That means investors can consider whether the automaker is preparing for the market’s transition to electric vehicles, or whether it’s buying a drug maker that faces a spate of lawsuits over its role in the opioid epidemic. There are, he said.

Maryland Democrat Rep. Jamie Ruskin said asset managers and pension managers are simply smart when weighing ESG angles to their investments, and not considering those angles is “negligent.” It’s a careless investment strategy.”

Expect the fight to continue. Kentucky Rep. James Comer, the GOP chairman of the commission, said lawmakers “will continue to expose and investigate harmful ESG practices, and hold unelected bureaucrats to the American public to serve their interests.” will be held accountable for imposing

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