The collapse of the FTX exchange has impacted many firms associated with the platform, and some investors have come to believe their investments were misguided. Yet, American venture capitalist Alfred Lin, partner at Sequoia Capital, remains confident in the initial decision to invest.
Sequoia lost over $213 million by investing in FTX. The firm invested $213.5 million in the now-defunct exchange; however, Lin asserted in a recent talk that the investment was the appropriate move at the time. He even went as far as saying he would recommend investing in FTX again if given the opportunity to evaluate it for the first time.
Lin emphasized that, based on the data Sequoia had at the time, there were no suspicious activities or red flags regarding FTX. Although the investment may have ended in failure, this serves as a reminder that the firm must trust in its founders and perpetually evaluate potential risks.
Sequoia Capital currently manages around $85 billion in assets under management and has invested in numerous technology companies, including several crypto-based businesses. Two of its funds were used to invest in FTX and FTX US; one holding a $150 million investment, whereas the other invested roughly $63.5 million.
Following the exchange’s downfall, Sequoia sent a letter to its partner referring to its FTX investments as “complete losses.” Nonetheless, the company acknowledged that it partakes in the business of taking risks and that some investments will prove disappointing.
Despite the negative outcome with FTX, Lin was keen on emphasizing that Sequoia remains optimistic about cryptocurrency and the overall concept of digital assets. This enthusiasm persists despite the ripple effect of the FTX incident, which has generated numerous legal issues for the venture capital firm.
Beyond the substantial loss of investment, the FTX collapse has led to lawsuits filed against its financiers, including Sequoia, Paradigm, and Thoma Bravo, by some of the exchange’s now bankrupt users. Nevertheless, Sequoia seems determined to continue pursuing opportunities within the ever-evolving crypto industry.
Source: Cryptonews
