Temasek still holds its investments in many other crypto-related businesses despite writing down its $275 million investment in FTX.
According to Deputy Prime Minister Lawrence Wong, Temasek, a government-owned investment company in Singapore, has endured much more than just monetary losses as a result of its investment in FTX.
Temasek’s $275 million investment in FTX, according to Wong, who is also the finance minister, has seriously harmed the company’s reputation. At a parliament meeting on November 27, the official addressed the mounting criticism regarding Temasek’s exposure to FTX, according to a South China Morning Post report.
The prime minister emphasized that a “very badly managed company” as well as potential fraud and user funds misappropriation were to blame for FTX’s demise.
“What happened with FTX, therefore, has caused not only financial loss to Temasek but also reputational damage,” the official said, adding that Temasek has launched an internal investment review to improve processes and draw lessons for the future.
Wong emphasized that reputational harm is not mitigated by investments made by other significant institutional investors like BlackRock and Sequoia Capital. Temasek announced on November 17 that it wrote down its entire $275 million FTX investment.
Temasek is wholly owned by the minister of finance but runs independently. As of March 2022, the sum represented just 0.09% of Temasek’s $403 billion portfolio.
Wong asserts that investor contributions to net investment returns—the amount of government revenue derived from interest earned on reserves—would not be impacted by FTX-related losses.
Along with addressing worries about FTX and Temasek, Wong asserted that Singapore has no desire to develop into a major crypto hub but rather wants to be a “responsible and innovative player in the digital asset space.”
“Some of the earlier optimism about blockchain technologies has been proven to be […] not well-placed. I think there’s a more realistic sense of what these technologies can do,” Wong stated.
He also emphasized that crypto investors must be prepared to lose all their investments on crypto, adding: “No amount of regulation can remove this risk.” Temasek apparently still has investments in numerous other industry platforms despite writing down its investment in FTX.
Temasek is renowned for taking part in numerous investment rounds for significant crypto firms, such as Binance and Amber Group, despite not making direct investments in cryptocurrency. According to reports, Temasek also oversaw a $110 million strategic funding round for Animoca Brands, a leading provider of blockchain and metaverse gaming services.
