The bankruptcy estate of FTX sold a 5% stake in Cursor, an AI coding startup, for $200,000 in April 2023. Following SpaceX's recent agreement to acquire the company at a $60 billion valuation, that same stake would now be worth approximately $3 billion. This development has brought attention to one of the largest missed recoveries in crypto history.
SpaceX's acquisition is part of Elon Musk's efforts to enhance his AI coding capabilities, particularly through his company xAI, which merged with SpaceX. The deal includes a provision for SpaceX to purchase Cursor for $60 billion later this year or pay $10 billion if the full acquisition does not proceed.
The significant increase in Cursor's valuation can be attributed to its remarkable growth since launching its AI coding product in early 2023. This trajectory is one of the steepest in software startup history.
The sale of the Cursor stake by FTX's estate has sparked debate, especially given that the estate received the same amount for the stake as Alameda Research had initially invested in 2022. The gap between the sale price and the current valuation represents a substantial missed opportunity for the creditors of FTX's estate.
This incident may be cited by Sam Bankman-Fried, currently serving a 25-year federal sentence, as an example of the value destroyed by the estate's liquidation of assets during the bankruptcy process. Bankman-Fried has argued that holding onto assets instead of selling them could have resulted in a significantly higher recovery for FTX's customers.