In April 2023, FTX's estate sold a 5% stake in AI coding startup Cursor for $200,000, a valuation that has skyrocketed to approximately $3 billion following SpaceX's recent agreement to acquire the company at a $60 billion valuation. This substantial increase in value underscores a significant missed recovery in crypto history. The deal is part of Elon Musk's efforts to bridge the gap with competitors in AI coding tools, an area where his company, xAI, is currently lagging behind.
The sale of the Cursor stake by FTX's estate has raised questions about the timing and handling of the company's assets during its bankruptcy. The initial investment in Cursor was made by Alameda Research, the trading firm founded by Sam Bankman-Fried, which invested $200,000 in the company in April 2022. This investment gave Alameda a roughly 5% stake in the company at a $4 million valuation.
However, after FTX's collapse, the court-appointed estate sold the stake for the same $200,000, missing out on a potential 15,000x return. The significant disparity between the sale price and the current valuation has sparked debate about the handling of FTX's assets during its bankruptcy, with Bankman-Fried arguing that the estate's liquidation of assets too quickly destroyed billions in value. The case of the Cursor stake has become a prime example of the potential value that could have been realized if the estate had held onto its assets instead of selling them during the bankruptcy process.