In April 2023, FTX's bankruptcy estate sold a 5% stake in AI coding startup Cursor for $200,000, a valuation that would now be approximately $3 billion following SpaceX's acquisition agreement at a $60 billion valuation. This deal marks a significant move by Elon Musk to bridge the gap with competitors in the AI coding tools sector. The transaction is contingent on SpaceX's planned initial public offering, which aims for a $2 trillion valuation. The crypto community is abuzz with the news, given the investment by Alameda Research in Anysphere, the company behind Cursor, in April 2022.
The investment of $200,000, which bought roughly 5% of the company at a $4 million valuation, was sold by the FTX estate for the same amount a year later, following the collapse of FTX. This represents a missed opportunity of approximately $3 billion, a 15,000x return, which could have been realized by the creditors if the estate had held onto the assets. The timing of this news is awkward for FTX's bankruptcy administration, as Sam Bankman-Fried has argued that the estate's liquidation of assets too quickly destroyed billions in value. He has projected that FTX's net asset value could have reached $78 billion if the estate had held onto assets instead of selling them in 2023 and 2024.
The Cursor stake's value has increased significantly since its launch in early 2023, making it one of the steepest trajectories in software startup history. While FTX customers have been repaid in full, they did not receive the upside from the assets' subsequent increase in value, including the $3 billion forgone recovery from the Cursor stake.