In April 2023, FTX's estate sold a 5% stake in AI coding startup Cursor for $200,000, a investment that would now be valued at approximately $3 billion following SpaceX's recent agreement to acquire the company at a $60 billion valuation. This development has brought attention to the significant losses incurred by FTX's creditors due to the estate's decision to liquidate assets during the bankruptcy process. The deal between SpaceX and Cursor is part of Elon Musk's strategy to enhance his company's position in the AI coding tools market, an area where he believes his company lags behind competitors.
The acquisition is contingent on SpaceX's planned initial public offering, which is expected to achieve a $2 trillion valuation. Meanwhile, the sale of the Cursor stake has become a point of contention in the FTX bankruptcy case, with founder Sam Bankman-Fried arguing that the estate's decision to liquidate assets too quickly resulted in significant losses for creditors. Bankman-Fried has projected that FTX's net asset value could have reached $78 billion if the estate had held onto its assets instead of selling them during the bankruptcy.
The Cursor stake's rapid appreciation in value, from $200,000 to $3 billion in just a few years, is a stark example of the potential value that was lost due to the estate's actions. This incident is likely to feature prominently in Bankman-Fried's ongoing campaign to revisit his case and potentially secure a pardon.