No red flags at FTX despite 8 months of 'thorough due diligence': Temasek

Despite eight months of due diligence, investment firm Temasek found no major issues with FTX's finances and no signs that the crypto exchange would eventually collapse.< /p> New

Singapore's public investment firm, Temasek, has revealed that despite eight months of due diligence in 2021, it found no significant red flags in FTX's finances before deciding to invest 275 million dollars in the now bankrupt crypto exchange.

Like many of FTX's more than one million creditors, the Singapore-based company was taken aback by FTX's collapse and ongoing fallout, stating in a November 17 post:

“The thesis of our investment in FTX was to invest in a leading digital asset exchange providing us with protocol-agnostic and market-neutral exposure to the crypto markets with a fee-based revenue model and no trading or balance sheet risk."

Before the company decided to invest $210 million for a 1% stake in FTX International and $65 million for a 1.5% minority stake in its US-based entity, FTX US, over two funding rounds, she claims to have conducted "extensive due diligence" from February to October 2021.

According to Temasek, he reviewed FTX's audited financial statements, investigated the regulatory risk associated with crypto financial market service providers, and sought advice from outside legal and cybersecurity experts, with a re...