Google's $2 billion investment puts FTX's bankruptcy "close to full recovery"

Authors: Oluwapelumi Adejumo; Source: beincrypto; Compiler: Golden Finance, Ke Dong

Travis Kling, a hedge fund manager, believes that Google's recent $20 billion investment commitment to artificial intelligence company Anthropic will help propel FTX from bankruptcy to full recovery.

On October 27, 2023, tech giant Google reportedly pledged to invest $2 billion in Anthropic, including an initial investment of $500 million, with plans to gradually inject the remaining $1.5 billion.

FTX's bankruptcy is close to full recovery

On social media X (formerly Twitter), Travis Klinger, founder of Ikigai Asset Management, said that Google's investment in the AI company would help bring FTX's bankruptcy close to full recovery. He said:

"At present, FTX bankruptcy is close to full recovery. While it takes years to pay off, assets can now be roughly 1:1 with customer deposits. ”

However, Ari Paul, the founder of BlockTower Capital, has a different opinion, arguing that Google's investment does not mean that Anthropic will return cash. Paul said,

"Anthropic may never return cash, which could be similar to the mistake of believing that FTX is solvent due to its ownership of SRM and FTT holdings. In my opinion, reaching about half of the recovery is also a huge doubt, and most of them are not even really 'valuation rounds'. ”

Last year, FTX and its affiliate, Alameda Research, invested $500 million in Anthropic.

Since then, Anthropic has made significant progress, creating Claude2, a chatbot that competes with OpenAI's ChatGPT, and has received nearly $7 billion in funding over the past year.

As a result, Anthropic's valuation is on track to surpass the $4.1 billion reported earlier this year to more than $20 billion. This increased valuation could significantly boost FTX's stake in the company, bringing it above $4 billion.

SBF admits mistakes

Meanwhile, former FTX CEO Sam Bankman-Fried (SBF) admitted to his mistakes during his tenure at the exchange in a criminal trial in New York.

SBF acknowledged that "a lot of people were hurt" after FTX declared bankruptcy last year. The former CEO also pointed out that one of the mistakes he made in the bankrupt company was not appointing a risk manager.

In addition, SBF accused his former colleagues Caroline Ellison, Gary Wang and Nishad Singh of not playing their part when the exchange was in trouble.

He argued that Ellison had not followed his instructions on hedging risks at Alameda. On the other hand, Wang and Singh have the right to make their own decisions despite being supervised by him.