In April 2023, FTX's estate sold a 5% stake in AI coding startup Cursor for $200,000, a fraction of its current value of $3 billion, following SpaceX's agreement to acquire the company at a $60 billion valuation. This deal has brought attention to the significant missed recovery for FTX's creditors. The stake was originally purchased by Alameda Research, a trading firm founded by Sam Bankman-Fried, for $200,000 in April 2022, representing a 5% ownership in the company. After FTX's collapse, the court-appointed estate sold the stake for the same amount, resulting in a substantial loss of potential value for the creditors.
The timing of the sale has raised questions about the handling of FTX's assets during the bankruptcy process, with Bankman-Fried arguing that the estate's decision to liquidate assets too quickly destroyed billions of dollars in value. The significant increase in Cursor's valuation, from $4 million to $60 billion, highlights the potential upside that FTX's creditors missed out on. This example is likely to feature prominently in Bankman-Fried's arguments and his family's campaign for a pardon, as it illustrates the kind of value that could have been realized if the assets had been held rather than sold.