Temasek International, the Singapore state investment fund, has written off its entire investment in “bankrupt” exchange FTX, making the institution probably Lose the most
The collapse of FTX implied a “contagion” effect related to the market turmoil that spread throughout the crypto industry. The FTX empire consisted of several separate but interconnected companies.
“Write-down” on FTX Investments
News of the FTX infection sent waves across the globe. This time specifically in Singapore. The state-owned investment agency Temasek has decided to write off its entire investment in FTX considering the financial condition of FTX.
The write-down is treated as an expense, which reduces net income and tax liability.
“Given FTX’s financial condition, we have decided to write off our entire investment in FTX, regardless of the outcome of FTX’s bankruptcy protection filing,” Temasek said in a statement.
The investment firm invested $210 million and $65 million for a minority stake of ~1% and ~1.50% in FTX International and FTX US, respectively, in two funding rounds from October 2021 to January 2022.
This spending spree accounted for 0.09% of its net portfolio value, which the company said “will not have a significant impact on our overall performance.”
Looking at the current situation, the firm is writing off the entire $275,000 that it had put into the crypto exchange. While this may not be a significant loss in relative terms, Colin Wu, a Chinese crypto reporter, emphasis on“Temasek is probably the institution that has suffered the most on FTX.”
Singapore firm says FTX allegations amount to fraud
FTX has been the target of various reports alleging that the exchange and its former CEO, Sam Bankman-Fried, misappropriated client assets. The exchange is under scrutiny from various regulators around the world. Temasek said that if the allegations were true, it would constitute “serious misconduct or fraud”. The statement further said,
“It is clear from this investment that the views that we may place on Sam Bankman-Fried’s actions, judgment and leadership, formed from our interactions with him and expressed in our discussions with others, may appear to be misplaced.”
The announcement comes just days after SoftBank wrote down its $100 million investment in FTX. Meanwhile, Sequoia Capital also hopped on the same bandwagon.
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