Thoma Bravo founder says firm permanently exits crypto post-FTX fiasco

Source: Crypto Briefing

Thoma Bravo, managing approximately $160 billion in assets under management, has decided to permanently withdraw from the crypto market following its ill-fated investment in FTX, said Orlando Bravo, the head of the top private equity firm, in a recent interview with CNBC.

Miami-based tech investor was part of a group of investors that led a $900 million investment in FTX in 2021, which valued the exchange at approximately $18 billion. The company invested roughly $130 million in FTX Trading, the operator and owner of FTX.com.

However, Thoma Bravo, along with other investors, faced substantial losses following the collapse of FTX.

FTX’s downfall began when concerns about its financial practices surfaced, leading to the massive withdrawal of funds by customers. The situation escalated quickly, with FTX unable to meet the withdrawal demands, ultimately resulting in its bankruptcy filing in November 2022.

The exchange was later exposed as a massive house of cards built on fraud, misappropriation of customer funds, and an utter lack of competent management and oversight.

In March this year, FTX’s founder Sam Bankman-Fried was sentenced to 25 years in prison after being convicted guilty of all charges.

Following the collapse of FTX, Thoma Bravo and other investors, including Paradigm Operations and Sequoia Capital faced a lawsuit alleging they made misleading statements while promoting FTX and contributed to its misconduct.

Bravo stated that the firm would no longer engage in the crypto sector after losing its bet on FTX.

“Once you make a mistake and once you get burned on something, our philosophy and my philosophy is you never touch it again,” Bravo explained.

Despite the setback with FTX, Bravo still believes in the potential of blockchain technology.

“Personally, I’m a believer in blockchain. I think it’s a powerful way of doing many things and for many use cases, and I’ve always believed that,” Bravo stated.

FTX bankruptcy nears end with $16 billion fund recovery

The FTX bankruptcy saga is nearing its conclusion with approximately $16 billion successfully recovered, poised to repay customers fully, including interest.

The development follows the incarceration of Bankman-Fried at Brooklyn Metropolitan Detention Center. His colleagues, Caroline Ellison, Nishad Singh, and Gary Wang, have also pleaded guilty to federal crimes.

Amidst these proceedings, the US Bankruptcy Court for the District of Delaware is scheduled to host a crucial hearing on October 7 to confirm FTX’s Chapter 11 Plan of Reorganization.

If confirmed, the plan will enable over 98% of customers and unsecured creditors to be repaid in full. However, the repayment calculation, which is based on Bitcoin’s prices as of bankruptcy time, has faced criticism from creditors, challenging the fairness of the proposed plan.

Go to Source
Author: Vivian Nguyen