Temasek Surrenders a Crypto Blunder
On Wednesday, November 30, the Deputy Prime Minister Lawrence Wong (who double‑duty as Finance Minister) dropped a bomb into Parliament: Temasek Holdings is officially ditching its kraken‑ish stake in the doomed crypto exchange, FTX. The fallout? A hefty financial hit plus a bruised reputation.
Why the Loss Matters
Temasek’s $275 million (roughly S$377 million) vanished with FTX’s bankruptcy—a tiny 0.09 % clip of its grand S$403 billion portfolio. Even though the number looks small on paper, the actual hit is big enough to feel like a punch to the chest.
Internal Clean‑Up in 2024
Wong says the state investor didn’t just take the hit; it also got a real-time case study in risk mismanagement. Temasek has commissioned an independent review team to dig into how the oversight slipped, aiming to tighten procedures and turn the misstep into a lesson for the future.
What Went Down with FTX
Earlier this month, Sam Bankman‑Fried and his crew declared FTX bankrupt after a storm of accusations that customer funds were siphoned off. The allegations hit hard because the exchange served as a major hub for global crypto trading.
Key Takeaways
- The write‑down isn’t just a line‑item; it’s a learning moment for Singapore’s sovereign wealth machine.
- Reputational damage mandates a rigorous audit—so Temasek can brush up on good governance.
- Even a 0.09 % slice of a massive portfolio can feel like a budget blow, reminding everyone that high risk, high reward comes with high caution.
Final Thought
While the number may be small, the story is a reminder of the wild world of crypto, and how even the savviest investors must stay vigilant in the face of sudden upheavals.
Wong on losses: Part of investment and risk-taking
Wong’s Take on the Recent Investment Hiccup
Yesterday, Wong called the recent financial stumble “disappointing”. He added that the disappointment was compounded by the fact that the company in question turned out to be flawed in management – with evidence pointing toward possible fraud and mishandling of customer funds.
How the Government Manages Risk
When it comes to big investment players like Temasek, Wong explained that the Singaporean state is very clear about its risk appetite. Think of it like a safety net that says “no more than this much” and then double‑checks that we’re not walking too close to the edge.
Key Lessons from Losses
- Losses don’t automatically mean the governance system is broken.
- Failure is part of the investment game – the real challenge is how we react.
- Every flop or flare helps us fine‑tune our approach for the next round.
- Continuing to take smart, well‑judged risks is the recipe for solid, long‑term gains.
So, in short, while the recent setback was a bumpy ride, Wong reminds us that it’s all part of a broader strategy: learn, adjust, and keep pushing forward – but with better safeguards this time around.
An investigation needed?
Temasek’s Investigative Tightrope: When the Auditor‑General Steps In
So we’re talking about a question from the Workers’ Party chief Pritam Singh about whether there’s a point where the Auditor‑General’s Office would jump in to audit Temasek. A pretty serious call‑for‑accountability question.
Wong’s Take‑Home Message
In his reply, Liam L. Wong was clear enough that the government isn’t ruling out getting outside auditors to look into any investment loss. But he also made it plain that such a move means the issue goes beyond just a financial hit.
“If we are convinced that something has gone wrong inside the organisation—whether it’s negligence, fraud, or outright misconduct—then we will call in the Auditor‑General,” he said. “Only when the problem hits that big‑money threshold do we do a full audit and investigation.”
What Does “Big‑Money Threshold” Mean?
Wong hinted that it’s not enough for an investment to just under‑perform; the loss must be significant enough to signal there’s a deeper problem at play. Think of it as a red flag that says, “Hey, this isn’t just a bad pick, something bigger is happening.”
Will the Loss Make Temasek Hysterical?
MP Tan Wu Meng (PAP‑Jurong) asked if the hit would make Temasek shy away from putting its money into cutting‑edge tech and early‑stage firms. “Will Temasek avoid the next big thing?” he wondered.
Wong answered with a shrug and a smile. “Sure – some startups don’t do so well. But many of them become wildly successful. Temasek knows that risk and is set to keep taking it.” He added that the investment arm should stay insulated from political drama so it can do its job properly.
Why the Need for Insulation?
- Keep decisions focused on returns not on politics.
- Maintain professional integrity of the investment team.
- Continue the track‑record of sustainable growth.
In short, Temasek’s boss says the folks in charge will sidestep political noise and stay on course—whether that means making a bold move into AI, genomics, or some obscure new tech.
Bottom Line
There’s a point where the Auditor‑General gets involved, but it’s only when the loss signals something seriously off-track. When it comes to future tech bets, Temasek will keep investing—because history shows that the real winners are the ones who take calculated risks. And if the political press is trying to keep Temasek in its lane, the answer is: stay focused, stay informed, and keep the money flowing where it belongs—into innovation.
