In a remarkable 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 worth approximately $3 billion, following SpaceX's agreement to acquire the company at a $60 billion valuation. This development has brought attention to the significant value that could have been realized by FTX's creditors, had the estate not sold the stake. The deal is part of Elon Musk's strategy to enhance SpaceX's AI capabilities, particularly in AI coding tools, an area where the company is currently lagging behind competitors like OpenAI and Anthropic.
SpaceX has chosen to delay the acquisition due to its planned initial public offering, which aims for a $2 trillion valuation. The $10 billion payment serves as a breakup fee in this arrangement. The investment in Cursor was initially made by Alameda Research, a trading firm founded by Sam Bankman-Fried, in April 2022, with a $200,000 investment for a 5% stake in Anysphere, the company behind Cursor.
After FTX's collapse, the estate sold the stake for the same $200,000, resulting in a missed opportunity for a 15,000x return. This incident has sparked debate, particularly from Bankman-Fried, who argues that the estate's decision to liquidate assets too quickly has destroyed billions in value for creditors. The case of the Cursor stake is likely to be cited as a prime example of the potential value that could have been realized if the estate had held onto its assets.
Meanwhile, FTX customers have been reimbursed in full, plus interest, under the bankruptcy distribution plan, but they have not benefited from the potential upside of the assets sold during the bankruptcy process.