Temasek CIO Rohit Sipahimalani suspends crypto investments in contrast to Ho Ching’s contrarian stance after FTX loss – The Online Citizen Asia

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In an interview with CNBC on Tuesday (July 11), Temasek Chief Investment Officer Rohit Sipahimalani said Temasek is currently not considering investing in cryptocurrency companies.

“There is a lot of regulatory uncertainty in this environment. Told.

“If you have the right regulatory framework, we are comfortable with it, and you have the right investment opportunities, there is no reason why we should not consider it,” Sipahimalani said. added.

“However, as I said earlier, given the current situation, I am reluctant to invest in exchanges at this time.”

He added that Temasek had no intention of investing in cryptocurrencies. “We have never thought about investing in cryptocurrencies. Investing in FTX is also about investing in exchanges where you can earn commission income without thinking. [of] Balance sheet risk, trading risk,” Sipahimalani said.

FTX is a disaster

In fact, Temasek was one of the most avid investors in cryptocurrency exchange FTX. But last November, the company had to write off its entire US$275 million investment in FTX to zero. FTX also filed for bankruptcy in the same month. According to the bankruptcy filing, the company had more than 100,000 creditors and had debts ranging from $10 billion to $50 billion.

“We recognize that investing at that level is dualistic and risky, so we rely on diversification. We limit early-stage investments to 6% of our portfolio. Sipahimalani defended Temasek’s decision to invest in FTX.

Sipahimarani said Temasek had done the necessary due diligence and ultimately found that FTX “has superior technology, has gained market share and has demonstrated a willingness to work with regulators to obtain a license.” ‘So we proceeded with the business.

Ultimately, though, “it’s very difficult to always reveal due diligence,” he says. “There will be some losses and write-offs when making early-stage investments, but what is important to us is that the overall portfolio of early-stage investments should do well.”

Sipahimalani graduated from St. Stephen’s University in Delhi, according to LinkedIn. He then completed his MBA at the Indian Institute of Management in Ahmedabad, India. He worked at Citibank in India before joining Morgan Stanley in Singapore. He then joined Temasek.

Temasek was still optimistic about cryptocurrency investments last July

In fact, Temasek was very positive about investing in crypto a year ago.

Anthony Lewis, Temasek’s director of cryptocurrency and blockchain venture building and investment, said at a forum on July 19 last year that Temasek is investing directly in a “single name.”

“So what we have gone public is FTX and FTX US, Australian Immutable, Consensus and Amber. Mr Lewis said.

He added: “Indeed, more activity than ever before. We are pretty active right now. The team is scaling up. I work with my team.”

Four months later, FTX collapsed. When FTX went bankrupt, Temasek accused FTX founders of false beliefs.

Later, Ms Ho Ching, wife of Singapore Prime Minister Lee Hsien Loong, broke her silence about the US$275 million write-off in a Facebook post, saying: Think long term. “

However, Mrs Ho did not disclose in her Facebook post whether she had overseen the investment in FTX.

Temasek claims the US$275 million investment has been made in two rounds of funding from October 2021 to January 2022, while FTX itself said in a press statement that Temasek is investing in a Series B. -1 held in October 2021 stating that it participated in a previously announced Series B in July 2021 along with fundraising activities.

If FTX’s statements are true, Ms Ho Ching should have overseen the initial investment in FTX before stepping down from her CEO position in October 2021 (a position she held since January 2004). is.

The social media atmosphere surrounding the controversy over Temasek’s illicit investment in FTX later forced Deputy Prime Minister Lawrence Wong to announce in parliament that Temasek would launch an internal investigation into the FTX debacle. But it will be done by Temasek’s own staff.

In any case, Temasek reported its worst earnings since 2016 for the fiscal year ending 2023. The net value of the company’s portfolio shrank to S$382 billion from S$403 billion a year earlier. Lost S$7 billion.

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