As the remains of FTX continue to fall down the drain with a storm of cryptic tweets from the former CEO, Sam Bankman, more and more firms have taken vital measures to clear the air, declaring the company’s risk dread. The majority of these entities that were at risk such as Huobi are abiding steps to try to salvage what’s left of their assets.
Regardless, some companies have preferred to mark their investments with the exchange as losses even if the US government’s investigation into FTX and its affiliated companies ends.
Temasek is a private firm made by the Government of Singapore in 1974 with the only shareholder being the Finance Minister of Singapore. The objective is to manage the government’s investment in different industries, letting the Ministry of Finance focus on core issues such as law and tax collection.
Temasek, in a statement, an investment company valued at around $293 billion, has declared that they will be noting down their investments in both FTX and FTX US, a spokesperson for the investment giant has reported.
According to the statement, Temasek realizes the value of blockchain technology across various industries and explained that its investment in FTX was to transfer to blockchain technology and not cryptocurrencies.
However, Temasek reveals that even its stringent auditing process is not always adequate to catch wind of mismanagement in the company they intend to invest in.
They believe that their due diligence methods can mitigate some risks, but it is not practical to eradicate all risks. Reports have since appeared that customer assets were misused and embezzled at FTX. If these statements are true, this calls for serious misconduct or fraud on FTX. All of this is presently under investigation by regulators.
Because of its unique position as a private company representing government interests, Temasek maintains itself to a high ethical criterion. As a consequence, Temasek decided to write down its investments in FTX and FTX US in order to minimize any possible damage to its reputation.
Although a write-down is not as intense as a write-off, it is still a hard measure when the market value of an asset is believed that it has fallen far below the value it is dealing for.
According to the statement, Temasek’s openness to FTX was restricted to only $275 million and was funded in both FTX and FTX US, which conveyed only 0.09% of Temasek’s total portfolio.
Since this part only added up to approximately 1% of FTX’s shares, Temasek had no place on FTX’s board of investors. Regardless, as an unofficial representative of the Singapore government, Temasek has chosen to hold itself to the same standards as a firm with a seat on the board and has estranged itself from the crumbling former crypto powerhouse.
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