City Sequoia Financial News

The sudden collapse of Silicon Valley Bank (SBV) has quickly unfolded over the course of three days, depegging stablecoins, leading regulators in the United States and United Kingdom to prepare emergency plans and raising fears among small businesses, venture capitalists and other depositors with funds stuck at the California tech bank.

As the 40-year-old banking institution, Silicon Valley Bank (SVB), winds down operation, numerous venture capitalists and investors joined hands and decided to cushion the impact in case the bank “were to be purchased and appropriately capitalized.”

defunct crypto exchange FTX asked a judge to approve the sale of its interest in a fund of venture capital firm Sequoia Capital to an Abu Dhabi state-backed investment firm, in a deal valued at $45 million. FTX agreed to sell the interest in the Sequoia Capital Fund, which previously belonged to its sister trading outfit Alameda Research’s venture arm, to Al Nawwar Investments RSC Limited on Wednesday, its estate said in a filing to Delaware’s bankruptcy court late that same day. Al Nawwar is a subsidiary of an investment fund wholly owned by the Abu Dhabi government, and is an existing investor in the Sequoia fund. Alameda had acquired the stake in March 2022 for an aggregate capital commitment of $100 million, the filing said. To date, around $50 million of that commitment had been called up by Sequoia for investment in various portfolio companies. Advisers for FTX have been scrambling to raise money from the failed crypto exchange’s wreckage in order to repay creditors, with around $5 billion in cash and cryptoassets located as of January. Liquidators said that it had decided it was in “the best interest” of the estate to sell its Sequoia stake now because of its size, expected management fees and because its value could diminish if Sequoia chose to make more capital calls in the future.

Big round numbers always pique the interest of investors and the $1 trillion total crypto market capitalization is no exception. It’s a level that held for 48 days before collapsing on March 9. After a 16-hour negative 8.6% price movement, the indicator fell to $914 billion, its lowest level since Jan.13.

The latest update in the FTX bankruptcy case comes as a new deal was struck between the defunct cryptocurrency exchange and Abu Dhabi.

Sequoia Capital has started screening some investments its China arm is considering in technology companies there for US national security concerns, according to people familiar with the matter, as Washington steps up efforts to stop American money from funding China’s development of sensitive technologies.

Nishad Singh, the co-founder and former chief engineer of bankrupt crypto exchange FTX, is working on a plea deal with prosecutors, Bloomberg reported on Feb. 17. The deal, which would see the 27-year-old Singh plead guilty to charges related to FTX’s collapse, has yet to be finalized, the report said.

Users of bankrupt crypto exchange FTX have reportedly taken aim at financiers who promoted the platform suggesting their efforts added an “air of legitimacy” to the now-defunct exchange, a case labeled as "tricky" by a crypto lawyer.

Decentralised Finance (DeFi) startup Flint, which is backed by investors like Sequoia Capital and Coinbase, has decided to discontinue its flagship yield offering service amid regulatory uncertainty, YourStory reported on January 27 citing an internal mail.

New revelations indicate that there were some close links between Sam Bankman-Fried, the disgraced founder of collapsed cryptocurrency exchange FTX, and some of his major backers.

In May 2022, Terraform Labs’ LUNA cryptocurrency and TerraUSD (UST) stablecoin collapsed, triggering a massive shock in the crypto industry. Six months later, the bruised industry took another hammering as one of the largest cryptocurrency exchanges, FTX, filed for bankruptcy protection and billions of dollars of user assets went missing. The FTX empire, once valued at more than $30 billion, fell to zero in fewer than 10 days.

The venture capital arm of Sam Bankman-Fried’s crypto trading firm Alameda Research had illiquid investments worth more than $5.4bn spread across nearly 500 companies, newly published documents have revealed.

Singapore government-owned investment firm Temasek has suffered a lot more than just financial losses due to investing in FTX, according to Deputy Prime Minister Lawrence Wong.

The collapse of the now-bankrupt cryptocurrency exchange FTX has put the Singapore prime minister and the ruling government in a hot seat. Prime Minister Lee Hsien Loong and Deputy Prime Minister Lawrence Wong are set to face grilling questions for their failure to protect retail investors.

In a rare move, American venture capital firm Sequoia Capital reportedly apologized to its fund investors for the $150 million it had lost on the now-bankrupt crypto exchange FTX.

On Nov. 11, while the rest of the country was celebrating Veteran’s Day, Sam Bankman-Fried announced that FTX — one of the world’s largest cryptocurrency exchanges by volume — had filed for bankruptcy. Lawmakers and pundits quickly latched onto the rapid disintegration of FTX to call for more regulation of the crypto industry. “The most recent news further underscores these concerns [about consumer harm] and highlights why prudent regulation of cryptocurrencies is indeed needed,” said White House Press Secretary Karine Jean-Pierre.

While the FTX collapse may have had a severe effect on the broader crypto market, some companies bore the brunt of the impact and were directly hit by the storm that the embattled crypto exchange brought. 

Bankman-Friedalso tried to get a group of crypto firms to each pitch in $1 billion.

Dear Reader, 

‘The king is dead, long live the king!’

The XRP price has risen by 8% in the past day, with its current level of $0.394470 representing a 20% jump since it fell to around $0.33 in the wake of the FTX insolvency crisis. XRP is one of the best-performing major coins in the last 24 hours, although the outcome of the SEC vs. LBRY case casts doubt on Ripple's ability to come to a positive conclusion in its own case.