Following SpaceX's agreement to acquire Cursor at a $60 billion valuation, it has been revealed that a 5% stake in the AI coding startup, sold by FTX's bankruptcy estate for $200,000 in April 2023, would now be worth approximately $3 billion. This development has brought attention to one of the largest missed recoveries in crypto history, with the estate's decision to sell the stake being scrutinized.
The investment was initially made by Alameda Research, the trading firm founded by Sam Bankman-Fried, in April 2022, with the company valuated at $4 million at the time. After FTX's collapse and subsequent bankruptcy, the court-appointed estate sold the stake for the same $200,000, resulting in a significant loss of potential revenue for the creditors. The gap between the selling price and the current valuation represents a 15,000x return, which would have been realized by the creditors if the estate had held onto the stake.
This incident has sparked debate, with Bankman-Fried arguing that the estate's decision to liquidate assets too quickly destroyed billions in value, and that customers could have been made whole if the process had been handled differently. The timing of the SpaceX acquisition has also raised questions about the FTX bankruptcy administration and the potential consequences of the estate's decisions.
As the situation continues to unfold, the $3 billion forgone recovery from the Cursor stake is likely to be a key point of discussion in the ongoing campaign for a pardon for Bankman-Fried.