In a stunning turn of events, a 5% stake in AI coding startup Cursor, sold by FTX's bankruptcy estate for $200,000 in April 2023, 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 to light a significant missed recovery in crypto history, with the estate's decision to liquidate the asset potentially costing creditors billions of dollars. The transaction is part of SpaceX's efforts to close the gap with competitors in the AI coding tools space, an area where Elon Musk's xAI is currently lagging behind. The deal's structure, which includes a $10 billion breakup fee, is tied to SpaceX's planned initial public offering, targeting a $2 trillion valuation.
The crypto connection stems from Alameda Research's $200,000 investment in Anysphere, the company behind Cursor, in April 2022. This investment, which represented a 5% stake in the company, was sold by the FTX estate for the same amount a year later, following the collapse of FTX and Alameda. The significant disparity between the sale price and the current valuation has sparked debate about the timing and handling of the estate's asset liquidation, with former FTX CEO Sam Bankman-Fried arguing that the estate's actions destroyed billions of dollars in value for creditors.
The Cursor stake's remarkable growth, from a $4 million valuation to $60 billion in just three years, is among the steepest in software startup history, and its implications are likely to feature prominently in ongoing discussions about the FTX bankruptcy and its aftermath.