Google’s Anthropic Investment Gives FTX Hope for Full Recovery

Hedge fund manager Travis Kling believes Google’s recent $2 billion investment commitment in artificial intelligence (AI) firm Anthropic will help to push FTX’s bankruptcy to full recovery.

On October 27, reports emerged that technological giant Google had committed to a $2 billion investment in Anthropic. This includes an initial $500 million investment, with plans to infuse the remaining $1.5 billion over time.

FTX Bankruptcy Nears Full Recovery

In a post on X (formerly Twitter), the founder of Ikigai Asset Management, Travis Kling, suggested that Google’s investment in the AI company would help FTX’s bankruptcy near full recovery. He said:

“FTX bankruptcy getting pretty close to a full recovery at this point. It’ll take years to pay out, but estate assets vs customer deposits prob about 1:1 now.”

However, the founder of BlockTower Capital, Ari Paul, countered that Google’s investment does not mean Anthropic will return cash. Paul said:

“Anthropic may or may not ever return cash, but could be similar mistake to thinking FTX was solvent because of SRM and FTT holdings. Imo, about half the recovery a giant question mark of paper marks, most not even real ‘valuation rounds.’”

Last year, FTX and its affiliate, Alameda Research, made a substantial $500 million investment in Anthropic. Since then, the AI company has made remarkable strides by creating Claude2, a competing chatbot to OpenAI’s ChatGPT, and has also secured nearly $7 billion in funding during the past year.

As a result, Anthropic’s valuation is poised to surpass the $4.1 billion mark reported earlier this year to more than $20 billion. The increased valuation could drastically push FTX’s stake in the company to more than $4 billion. 

SBF Acknowledges Mistakes

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

SBF conceded that “a lot of people got hurt” after FTX declared bankruptcy last year. The former CEO also noted that one of his mistakes at the bankrupt firm was failing to appoint a risk manager.

Additionally, SBF blamed his former associates, Caroline Ellison, Gary Wang, and Nishad Singh, for their roles in the exchange’s troubles.

He argued that Ellison did not adhere to his guidance on Alameda’s risk hedging at FTX. On the other hand, Wang and Singh had the authority to make autonomous decisions despite being under his supervision.