The recent agreement between SpaceX and Cursor has shed light on a substantial missed recovery for FTX's bankruptcy estate. In April 2023, the estate sold its 5% stake in Cursor for $200,000, a stake that would now be worth approximately $3 billion following SpaceX's acquisition of the company at a $60 billion valuation.
This deal has sparked controversy, particularly given the significant gap between the original sale price and the current valuation. The transaction is also noteworthy as it comes amidst SpaceX's plans for an initial public offering, which is expected to reach a $2 trillion valuation. The company has chosen to delay the acquisition to avoid potential complications with its IPO.
Meanwhile, the original investment in Cursor was made by Alameda Research, a trading firm founded by Sam Bankman-Fried, who is currently serving a 25-year federal sentence. Bankman-Fried has argued that the FTX estate's decision to liquidate assets too quickly during the bankruptcy process destroyed billions of dollars in value, a claim that the Cursor stake's massive increase in value seems to support. The estate's sale of the stake has been criticized, with some arguing that the creditors would have benefited greatly if the assets had been held onto rather than being sold at a low point in the market. The situation has also raised questions about the distribution plan for FTX customers, who have been made whole in terms of their claim values but did not receive the upside from the assets' subsequent increase in value.
The significant disparity between the original sale price and the current valuation of the Cursor stake is likely to be cited as an example of the value that was lost due to the estate's handling of the assets.