Some customers harmed by the collapse of crypto exchange FTX under co-founder and former CEO Sam Bankman-Fried are keeping a close eye on SpaceX’s post-IPO performance.
As Elon Musk’s rocket-maker has soared far beyond its initial market valuation of $1.77 trillion, the firm’s Wall Street debut has lifted hopes among those tracking the exchange’s bankruptcy proceedings that creditors could walk away with more than previously anticipated.
Sunil Kavuri, a British investor who lost around $2 million to FTX’s implosion and has become a vocal spokesperson for Bankman-Fried’s other victims, told Decrypt that “it’s always great news seeing good investments that could help recovery and payment to FTX creditors.”
Decrypt reached out to FTX’s bankruptcy estate for comment but did not immediately receive a response.
“Schmidt suggests that one notable investment [...] is likely to yield significant proceeds this year,” Fried highlighted, referencing FTX’s SpaceX investment via venture firm K5 Global.
FTX Creditors with >$50k ClaimsRecovery still projected at 171% after receiving 96.6% so far
“It is clear that K5 is a bright spot in the FTX portfolio,” Ray said in a statement. “The expected strong performance of their investments will be a key driver in the recovery efforts.”
Decrypt reached out to K5 for comment but did not immediately receive a response.
The defunct exchange has yet to comment on SpaceX’s Wall Street debut—and on whether creditors could actually benefit—but Kavuri noted the bankruptcy estate would have to telegraph its sale of stakes in K5 via court filings.
Prior to his conviction, Bankman-Fried was accused of stealing more than $8 billion worth of customer funds. In addition to using the money to make political donations and purchase real estate, Bankman-Fried also abused funds through venture capital investments.
The filings note that Alameda Research, FTX’s sister trading firm, transferred massive amounts of money to a K5-affiliated entity, and—before the exchange collapsed in November 2022—one of K5’s funds had invested $190 million in Elon Musk’s rocket-maker.
