Source: "US$200 million vanished! Sequoia Capital writes down FTX assets to zero, BlackRock, SoftBank, etc. also fall into the trap"
Author: Zhu Xueying
The liquidity crisis caused by FTX, the "central mother of the cryptocurrency circle", continues to ferment, and the deep-seated financial black hole it exposed has intensified the "death spiral", which has deterred Binance, which was originally willing to provide timely assistance. Investors who have already stepped on the FTX thunder can only helplessly "admit their losses", including the well-known investment institution Sequoia Capital.
Sequoia Capital said in an email on Wednesday that it has written down the value of its FTX investment to zero. Sequoia Capital told investors that it invested about $214 million in FTX's international and U.S. businesses last year. In addition, according to a company spokesperson, the investment includes holdings in FTX.com and FTX.us.
The company wrote in the email:
We are in the business of taking risks…some investments will be a pleasant surprise and some investments will be a big disappointment.
However, Sequoia Capital still tried to reassure investors, saying that even in the fund with the largest exposure to FTX, FTX accounted for less than 3% of the committed funds. The company also emphasized that the fund has realized and unrealized gains of about $7.5 billion.
Media analysis said that the reason why Sequoia Capital directly chose to write down the amount can to a certain extent show that the company has lost confidence in FTX and believes that there is no other clear way to recover its investment in FTX.
As Multicoin Capital, a smaller venture capital fund that has invested in FTX, told investors on Wednesday, 10% of the firm’s assets under management would be affected:
Unfortunately, we are unable to withdraw all of our invested assets from FTX.
In addition to the above-mentioned companies, BlackRock, Tiger Global, SoftBank Group, the Ontario Teachers' Pension Plan which has long been ranked among the top five pension funds in Canada, well-known American football player Tom Brady and supermodel Gisele Bündchen and her husband are all on FTX's customer list and may suffer losses this time.
According to data agency PitchBook, Tiger Global and Ontario Teachers' Pension Plan first invested in FTX in a round of financing in December 2019, when FTX was valued at $8 billion. Then in October 2021, the two funds invested again, helping FTX's valuation reach $25 billion, and then increased their investment again in January 2022.
