Temasek Drops $275 Million From Its FTX Investment
What Went Wrong
Whole‑ignt Sale – Temasek Holdings decided to abandon its entire $275 million (S$377 million) stake in the crashed crypto exchange FTX.
“Write‑Down” Move – The company said it will write down the asset to zero, regardless of FTX’s bankruptcy proceedings.
Other Backers Failing Too – Big names like SoftBank’s Vision Fund and Sequoia Capital have likewise written their claims to nil after FTX declared bankruptcy in the U.S.
Why Temasek Did This
Tiny Share, Huge Loss – Temasek’s $210 million for ~1 % of FTX International and $65 million for ~1.5 % of FTX US turned out to be a loss.
Impact on the Portfolio – The investment represented only 0.09 % of its $403 billion net portfolio as of March 31, 2022.
Minor Slice of Early‑Stage Bets – Early‑stage funding currently forms roughly 6 % of Temasek’s total holdings.
Temasek’s Vision for FTX
“Kerfuffle” Plan – Temasek hoped the exchange would give them a protocol‑agnostic, market‑neutral exposure to crypto markets, generating fee income without any direct crypto holdings or trade risk.
“No Play, No Loss” – The goal was to stay safe by earning commissions instead of riding the roller‑coaster of crypto trades.
The Reality Check
Due Diligence Gone Wrong – Backed by an extensive review from February to October 2021, Temasek saw audited financial statements that looked bright and profitable.
Leadership Lapse – The trust in founder Sam Bankman‑Fried, which formed through personal interactions and interventions, turned out to be misplaced.
“I’m Sorry, Sam!” – The company acknowledged that its confidence in his judgment was unfortunately misplaced.
Bottom Line
Temasek’s small, “safe‑bet” investment in FTX turned into a full‑scale wipeout, aligning with other giants and revealing how even a 1 % stake in a digital exchange can shake the financial world. The takeaway? In the crypto realm, even careful players can be blindsided by unexpected downfalls.
