In a surprising 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 acquisition agreement at a $60 billion valuation. This development has shed light on one of the largest missed recoveries in crypto history.
SpaceX has announced its intention to acquire Cursor, with the option to buy the company for $60 billion or pay $10 billion if the acquisition does not proceed. This move is seen as a strategic effort by Elon Musk to bridge the gap with competitors in the AI coding tools space. The deal has been delayed due to SpaceX's planned initial public offering, which aims to achieve a $2 trillion valuation.
The crypto connection lies in Alameda Research's $200,000 investment in Anysphere, the company behind Cursor, in April 2022. This investment, which represented a 5% stake, was sold by the FTX estate for the same amount a year later, resulting in a significant loss of potential value for creditors. The timing of this sale has raised questions about the management of FTX's bankruptcy assets, with Sam Bankman-Fried arguing that the estate's liquidation of assets too quickly destroyed billions in value.
The Cursor stake's massive increase in value, representing a 15,000x return, has become a prime example of the potential value that could have been realized if the estate had held onto its assets. While FTX customers have been reimbursed in full, they have not benefited from the substantial upside of the assets sold during the bankruptcy process, including the Cursor stake, which is now worth $3 billion.