- The FTX crash has caused the fund to fall by a startling 55% over the previous month.
- Multicoin Capital reportedly chooses to write down FTX to zero.
The FTX outbreak is rapidly increasing in scope. As reported by crypto venture capital company Multicoin Capital to its investors on November 17th, the FTX crash has caused the fund to fall by a startling 55% over the previous month.
Multicoin thinks it has a chance of getting its money back from FTX someday. However, Multicoin Capital chooses to write down FTX to zero since they are now involved in bankruptcy procedures. The crypto investment business was vague about the amount it is writing down owing to the FTX crash. The experts in the market estimate that this might be more than $850 million.
Devastating Setback
Multicoin managing partners Kyle Samani and Tushar Jain stated: “We put entirely too much trust in our relationship with FTX. We had too many assets on FTX.” In light of Multicoin’s July announcement of a $430 million fund, this is a devastating setback. About one-quarter of the company’s assets were recovered last week when the FTX collapsed. Even yet, the firm still has approximately 15% of its assets on FTX.
All of Multicoin Capital’s assets were split between Binance, FTX, and Coinbase. The whole remaining crypto venture fund portfolio is now held either in self-custody or on Coinbase.
According to the firm:
“At present, the fund has no assets exposed to any other counterparties. In the future, we anticipate some diversification of custodial exposure – with Coinbase expected to remain our primary custodian – and will resume trading with other counterparties as we continue to assess the present market fallout.”
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