FTX Buys Alameda Research VC Operations Division
The investment division of Sam Bankman-cryptocurrency Fried’s exchange FTX has apparently acquired Alameda Research venture capital (VC) activities in light of the current weak market in cryptocurrencies.
Caroline Ellison of Alameda Research stated in an interview that the merger took place prior to the retirement of former co-CEO Sam Trabucco, leaving Ellison as the sole employee in that position. When Alameda’s acquisition reportedly began, FTX Ventures’ investment division reportedly managed two billion dollars’ worth of assets.
The move’s effects, according to the research, were minor for Alameda but significant for the crypto startup industry. More than 150 private businesses, including the non fungible token marketplace Magic Eden and the cryptocurrency bank Anchorage Digital, have received funding from Alameda.
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According to Amy Wu, the fund’s manager, the transaction began in January when FTX Ventures raised $2 billion. She also noted that FTX and Alameda did not exchange any cash.
The sale didn’t include any form of payment, according to Amy Wu, who oversees the venture capital (VC) fund, and Alameda’s investing arm was entirely under FTX Ventures. Wu said that the businesses operated separately, with the Alameda team not contributing to the venture side.
As part of its bankruptcy procedures, Voyager Digital turned down a joint offer from FTX and Alameda in July to buy out its cryptocurrency assets and outstanding loans. The company’s legal team issued a statement at the time stating that the given acquisition would have harmed clients, despite Alameda having its own services and backing cryptocurrency custody company Anchorage Digital.
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Ellison would take into account continuing to provide bailouts for cryptocurrency companies who are experiencing a liquidity crisis in the midst of a downturn market. She said, “The more significant someone is, the more crucial it would be to try to assist them.”
Although this prediction was made prior to the “crypto winter,” FTX reported $270 million in sales for the first quarter of this year and was expected to generate roughly $1.1 billion this year.
For FTX, who just signed a contract giving it the option to purchase lender BlockFi, it has been a hectic period. Additionally, the business is in talks to buy the South Korean company Bithumb, and on Thursday it was identified as a potential acquisition of the lender Voyager.
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Additionally, FTX is thinking about stepping up its retail trading initiatives and entering the stock market. The internal documents, however, demonstrate that there is still a role for “more sophisticated traders” who use futures or options. This week, PYMNTS announced that FTX saw revenue of $1 billion in 2021, an increase of 1,000% from $89 million.
