The bankruptcy estate of FTX sold a 5% stake in AI coding startup Cursor for $200,000 in April 2023, a stake that would now be worth approximately $3 billion following SpaceX's acquisition agreement at a $60 billion valuation. SpaceX has announced its intention to acquire Cursor, either by purchasing the company outright for $60 billion later this year or by paying a $10 billion breakup fee, as part of Elon Musk's efforts to enhance xAI's competitiveness in AI coding tools. The deal has drawn attention to the crypto aspect, as Alameda Research, founded by Sam Bankman-Fried, initially invested $200,000 in Anysphere, the company behind Cursor, in April 2022.
This investment, which represented about 5% of the company at a $4 million valuation, was sold by the FTX estate for the same amount after the company's collapse. The significant difference between the sale price and the current valuation represents a 15,000x return, which could have been realized by the creditors if the estate had not liquidated the asset.
This development supports Sam Bankman-Fried's argument that the FTX estate destroyed billions in value by liquidating assets too quickly during the bankruptcy process. Despite customers being repaid in full, they did not benefit from the potential upside of these assets, including the substantial increase in value of the Cursor stake.