FTX latest: Temasek takes a hit as Novogratz warns the worst is yet to come

(Bloomberg) — Singapore’s state investor, Temasek International, invested between $200 million and $300 million in cryptocurrency giant FTX before its collapse and is preparing to write down the entire bet, people familiar with the matter said.

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Michael Novogratz, the billionaire founder of Galaxy Digital Holdings, said the crypto crisis could worsen as the industry prepares for more contagion from the fall of Sam Bankman-Fried’s FTX empire.

Bankman-Fried took to Twitter on Wednesday, telling followers that “there is too much leverage — more than I realized” in his business. This came a few hours after he posted that FTX US had enough money to pay back customers.

The fallout from the crisis threatens the future of crypto lenders like BlockFi Inc. and Voyager Digital Ltd. Digital asset markets were steady after a break from recent turmoil, with Bitcoin hovering around $16,700.

Key stories and developments:

  • Singapore’s Temasek to subscribe over $200 million in FTX

  • FTX leaves an empty black box where the due diligence was

  • Matter Labs raised $200 million just before the chaos in the crypto market

  • FTX’s Crypto Kids came dangerously close to the upcoming futures

(Time references are New York unless otherwise noted.)

Temasek get hit (6:45am)

Temasek had invested between $200 million and $300 million in FTX before the collapse, according to people familiar with the matter.

Temasek is now preparing to write off the full amount, said one of the people, who spoke on condition of anonymity because the matter is private. Another backer, Sequoia Capital, listed the full value of its $214 million stake on the stock exchange, while a person familiar with the situation said SoftBank Group Corp . expects to lose about $100 million on its investment.

FTX Hacker’s Haul (18:05 HK)

The hacker who broke into Sam Bankman-Fried’s collapsed crypto exchange FTX is now one of the biggest holders of the Ether token in the world.

A wallet linked to the exploit exchanged about $49 million in stablecoins — mainly Dai — for Ether on Tuesday, security specialists PeckShield said.

FTX wallets were drained of more than $663 million in tokens, with 477 million of them believed to have been stolen and the remainder moved to secure storage by FTX, according to blockchain specialist Elliptic.

Novogratz warns worst may be yet to come (18:00 HK)

Mike Novogratz said that the worst of the crypto crisis resulting from the collapse of the FTX exchange may be yet to unfold. Galaxy, the crypto financial services firm founded by Novogratz, last week disclosed a $76.8 million exposure to FTX.com

Novogratz spoke at a conference call on Wednesday alongside the CEO of Binance Holdings Ltd. Changpeng ‘CZ’ Zhao. Binance’s CEO said he has seen a lot of investor interest in a crypto industry recovery fund he plans to set up to support otherwise strong projects that are facing a liquidity squeeze.

AAX crypto exchange needs capital (17:55 HK)

Resuming operations at cryptocurrency exchange AAX depends on whether it can raise funds, the company said. Hong Kong-based AAX suspended withdrawals on Monday, citing a system upgrade problem.

“If AAX is unable to secure financing to allow us to resume operations, AAX is committed to initiating legal proceedings to secure and secure the distribution of the assets,” the company said.

Most Lost Bitcoin Retail Buyers (14:20 HK)

A survey of how retail investors use cryptocurrency exchange apps shows that around three-quarters have lost money on bitcoins, according to the Bank for International Settlements.

The data, covering 95 countries from 2015 to 2022, showed that the majority of app downloads occurred when the price of bitcoin was above $20,000, the Basel, Switzerland-based research paper said. BIS.

The world’s largest token has tumbled more than 70% from a record hit about a year ago, pressured by rapid monetary policy tightening and a series of huge blowouts in crypto companies, most recently FTX.

FTX Digital Markets Files for Chapter 15 (noon HK)

Bahamas-based FTX Digital Markets Ltd. has filed a Chapter 15 petition to recognize a foreign proceeding in the Southern District of New York, according to a statement on the court’s website.

It is a subsidiary of FTX Trading Ltd., which filed for Chapter 11 bankruptcy on November 11.

–With help from Amanda Fung, Siddhartha Shukla and Suvashri Ghosh.

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