- Crypto investment firm Ikigai has warned that it may go under after heavy FtX exposure
- CIO Travis King said yesterday that the firm had “a large majority” of its assets on FTX
- It will continue with its remaining funds, but may not carry on in the long term
The Chief Investment Officer of crypto asset management firm Ikigai has warned that the company could be in serious trouble because it had “a large majority” of its assets on FTX. Travis Kling warned that it was “really hard to say” whether any of the money lost through FTX would be coming back, and that the situation would have to be further assessed before the firm made a decision on whether to keep going or to wind it down.
Ikigai “Got Very Little Out” of FTX
Ikigai was founded in 2018 and enjoyed a fruitful bull market, but it seems that the fund, like many, put too much trust in Sam Bankman-Fried and FTX. The platform’s spectacular collapse last week caught everyone by surprise, and Ikigai was only able to withdraw its funds on Monday morning, with Kling saying that they “got very little out” and that the overwhelming amount of assets, which of course are in the main client funds, were now “stuck alongside everyone else”.
Kling added that there were still some funds to work with, and offering hope to investors in its venture fund:
In the very near-term, Ikigai is going to continue trading the assets we have left that are not stuck on FTX. We’re also going to make a decision about what to do with our venture fund, which was unaffected by FTX.
The long term prospects for the company are less clear however, with much resting now when customers can expect anything back from FTX, and how much that might be. Early calculations suggest that FTX only had $900 million in assets to back up $9 billion in liabilities, but this was before $477 million worth of assets were stolen by what is thought to be FTX executives.
Commenters Criticize Ikigai Fund Handling
While Kling said the response from clients had been “deeply heartwarming”, the response from Twitter was less kind, with many asking why a crypto fund manager was keeping client money with a third party instead of in cold storage:
0 talent
— Johnny Blue (@Herojuana69) November 14, 2022
“Alongside everyone else”
No, most of us are fine. We bought BTC and put it in our own offline cold storage.
Don’t make it sound like everyone fell for this, just to deflect blame.
— Base58Check (@Base58Check) November 14, 2022
Kling also echoed thoughts put forward by many since FTX’s demise, that a return to decentralization has to be the way forward, saying that, “If Ikigai continues on, we pledge to fight harder in this regard. It’s a fight worth fighting.”
