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 agreement to acquire the company at a $60 billion valuation. This substantial increase in value has brought attention to the significant missed recovery in crypto history. SpaceX has agreed to either acquire Cursor for $60 billion later this year or pay $10 billion if the acquisition does not proceed, with the latter serving as a breakup fee due to SpaceX's planned initial public offering, which targets a $2 trillion valuation. The investment in Cursor originated from Alameda Research, the trading firm founded by Sam Bankman-Fried, which invested $200,000 in Anysphere, the company behind Cursor, in April 2022.
This investment granted Alameda a 5% stake in the company at a $4 million valuation. However, following FTX's collapse and subsequent bankruptcy, the court-appointed estate sold the Cursor stake for the same $200,000, resulting in a substantial loss of potential recovery for creditors. The gap between the sale price and the current valuation represents a 15,000x return, which was realized by the buyer rather than the creditors. This development comes as Sam Bankman-Fried argues from prison that FTX's estate destroyed billions in value by liquidating assets too quickly during the bankruptcy, and that customers could have been made more than whole if the process had held positions instead of selling them into what turned out to be the bottom of crypto prices.
The trajectory of Cursor's valuation, from its launch in early 2023 to its current valuation, is among the steepest in software startup history. While FTX customers have been repaid in dollar terms under the bankruptcy's distribution plan, they did not receive the upside from the assets' increased value, including the $3 billion forgone recovery from the Cursor stake.