In April 2023, FTX's bankruptcy estate sold a 5% stake in AI coding startup Cursor for $200,000, a valuation that has skyrocketed to approximately $3 billion following SpaceX's acquisition agreement at a $60 billion valuation. This development underscores a substantial missed recovery in crypto history, with the estate's sale of the stake now appearing as a vastly undervalued transaction.
The acquisition is part of Elon Musk's strategy to bolster SpaceX's position in AI coding tools, an area where the company currently lags behind competitors. The deal's structure, which includes a potential $10 billion payment if the full acquisition does not proceed, is tied to SpaceX's planned initial public offering, targeting a $2 trillion valuation. The crypto aspect of this transaction is rooted in Alameda Research's $200,000 investment in Anysphere, the company behind Cursor, in April 2022.
This investment, which represented about 5% of the company at a $4 million valuation, was sold by FTX's estate for the same amount a year later, following the collapse of FTX and Alameda. The significant disparity between the sale price and the current valuation of the stake has sparked debate, particularly given Sam Bankman-Fried's arguments that the estate's liquidation of assets too quickly during the bankruptcy destroyed billions in value.
Bankman-Fried has suggested that had the estate held onto these assets, including the Cursor stake, customers could have received significantly more than they did under the bankruptcy distribution plan. The Cursor stake's valuation increase from $200,000 to $3 billion represents a 15,000% return, a gain that was realized by the buyer of the stake rather than FTX's creditors.
This situation highlights the complexities and challenges of managing assets during bankruptcy proceedings, especially in the volatile crypto market.