Ontario Teachers Fund Lost $95 Million To The Failed FTX Empire
Following significant investments in FTX over the past year, an Ontario teachers’ pension fund is now entangled in the current cryptocurrency turmoil.
According to Financial Post, the fund’s trustee, the Ontario Teachers’ Pension Plan Board, stated it had about $95 million invested in Sam Bankman-former Fried’s mighty enterprise.
After several controversies, including the revelation that FTX had mixed up user assets with sibling trading firm Alameda Research, that empire has now fallen. The unit’s balance sheet was severely skewed in favor of FTT, the native token of FTX, which has fallen 85% in value over the past three days.
Ontario Teachers’ venture arm, Teachers’ Venture Growth (TVG), which was apparently founded two years earlier to invest money in up-and-coming digital companies, made its initial $75 million investment into Bahamas-based FTX and FTX.US in 2021.
FTX.US received an additional $20 million in January of this year. Despite the fact that cryptocurrency prices had since fallen from record highs reached months earlier, the market appeared to be relatively stable and expanding.
Following a $400 million fundraising, FTX’s worth increased from $25 billion in October 2021 to $32 billion at that time. Sequoia, a stalwart of venture finance, reduced its FTX ownership value to zero this week.
At this time, it’s unclear how much the fund has actually lost. An inquiry for comment was not immediately answered by a representative.
TVG’s head Olivia Steedman had previously defended the investments
According to Financial Post, TVG’s head Olivia Steedman had previously defended the investments as a wager on crypto infrastructure rather than any particular coin, thinking the sector projected long-term growth.
According to the board, the fund’s exposure to FTX represents just 0.05% of its total assets, therefore the hypothetical collapse of FTX would have a little effect. On behalf of the teachers in Ontario, the board is responsible for managing net assets worth more than 242 billion Canadian dollars ($182 billion).
Darren Kleine, a local educator who does not directly have investments in the fund, told Blockworks that he anticipates some educators would be furious that the pension is exposed to such a “volatile section” of the market.
Teachers are required to make contributions to the fund under the fund’s constitution, and the Ontario government and member businesses match such contributions dollar for dollar.
The fund’s contribution requirements have gone up in times of extreme volatility in the past, even when nothing has been announced, to help it make up losses.
The second-largest pension fund in Canada, CDPQ, wrote off its $150 million investment in the now-bankrupt cryptocurrency lender Celsius in August, claiming it entered the market “too soon.”
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Website: coincu.com
Annie
CoinCu News
Author
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Ontario Teachers Fund Lost $95 Million To The Failed FTX Empire
Following significant investments in FTX over the past year, an Ontario teachers’ pension fund is now entangled in the current cryptocurrency turmoil.
According to Financial Post, the fund’s trustee, the Ontario Teachers’ Pension Plan Board, stated it had about $95 million invested in Sam Bankman-former Fried’s mighty enterprise.
After several controversies, including the revelation that FTX had mixed up user assets with sibling trading firm Alameda Research, that empire has now fallen. The unit’s balance sheet was severely skewed in favor of FTT, the native token of FTX, which has fallen 85% in value over the past three days.
Ontario Teachers’ venture arm, Teachers’ Venture Growth (TVG), which was apparently founded two years earlier to invest money in up-and-coming digital companies, made its initial $75 million investment into Bahamas-based FTX and FTX.US in 2021.
FTX.US received an additional $20 million in January of this year. Despite the fact that cryptocurrency prices had since fallen from record highs reached months earlier, the market appeared to be relatively stable and expanding.
Following a $400 million fundraising, FTX’s worth increased from $25 billion in October 2021 to $32 billion at that time. Sequoia, a stalwart of venture finance, reduced its FTX ownership value to zero this week.
At this time, it’s unclear how much the fund has actually lost. An inquiry for comment was not immediately answered by a representative.
TVG’s head Olivia Steedman had previously defended the investments
According to Financial Post, TVG’s head Olivia Steedman had previously defended the investments as a wager on crypto infrastructure rather than any particular coin, thinking the sector projected long-term growth.
According to the board, the fund’s exposure to FTX represents just 0.05% of its total assets, therefore the hypothetical collapse of FTX would have a little effect. On behalf of the teachers in Ontario, the board is responsible for managing net assets worth more than 242 billion Canadian dollars ($182 billion).
Darren Kleine, a local educator who does not directly have investments in the fund, told Blockworks that he anticipates some educators would be furious that the pension is exposed to such a “volatile section” of the market.
Teachers are required to make contributions to the fund under the fund’s constitution, and the Ontario government and member businesses match such contributions dollar for dollar.
The fund’s contribution requirements have gone up in times of extreme volatility in the past, even when nothing has been announced, to help it make up losses.
The second-largest pension fund in Canada, CDPQ, wrote off its $150 million investment in the now-bankrupt cryptocurrency lender Celsius in August, claiming it entered the market “too soon.”
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Website: coincu.com
Annie
CoinCu News
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