In a stunning 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. This deal has brought attention to the significant gap between the initial sale price and the current valuation, with the stake's value increasing by a staggering 15,000%.
The acquisition is part of Elon Musk's strategy to enhance SpaceX's AI capabilities, particularly in the area of AI coding tools, where the company currently lags behind competitors. SpaceX has announced plans to acquire Cursor for $60 billion, with the option to pay $10 billion if the full acquisition does not proceed. The connection to the crypto industry lies in Alameda Research's initial investment of $200,000 in Anysphere, the company behind Cursor, in April 2022. This investment represented a 5% stake in the company, valued at $4 million at the time.
However, following FTX's collapse and the subsequent bankruptcy, the court-appointed estate sold the stake for the same $200,000, unaware of its potential for exponential growth. The significant disparity between the sale price and the current valuation has sparked debate, particularly in light of Sam Bankman-Fried's claims that the FTX estate's rapid liquidation of assets destroyed billions of dollars in value. Bankman-Fried has argued that had the estate held onto these assets, customers could have received greater compensation. The timing of this revelation is particularly noteworthy, as it comes amidst Bankman-Fried's ongoing efforts to appeal his 25-year federal sentence.
His projections suggest that FTX's net asset value could have reached $78 billion if the estate had retained its assets, rather than selling them during the crypto market's downturn. The remarkable growth of Cursor, which launched its AI coding product in early 2023, has been one of the steepest in software startup history.
While FTX customers have received their claim values plus interest, they have not benefited from the substantial upside of the assets sold during the bankruptcy process, including the Cursor stake, which now represents a $3 billion loss. This development is likely to feature prominently in Bankman-Fried's ongoing campaign for a pardon, with his family and supporters arguing that the case against him should be revisited in light of the significant value destroyed by the estate's actions.