The Singapore government-owned investment firm Temasek initiates an internal review of its $275 million investment in the collapsed FTX exchange.
While addressing the parliament meeting, Singapore Deputy Prime Minister and Finance Minister Lawrence Wong stated Temasek’s investment in FTX seriously harmed the company’s reputation and called the loss “disappointing.”
Wong added, “The fact that other leading global institutional investors like BlackRock and Sequoia Capital also invested in FTX does not mitigate this.”
Last month, Temasek stated it will write down its entire investment in FTX following its crash.” Temasek invested $210 million in FTX International and $75 million in FTX US, totaling 0.09% of its net portfolio value of $293 billion.
Temasek has since started an internal review of its investment by an independent committee to strengthen its process and learn from the experience, according to Wong.
Such evaluations have been carried out in the past, and the government won’t rule out taking this one a step further by bringing in outside auditors, Wong said.
Temasek noted it had conducted “extensive due diligence” on FTX from February to October 2021 and its audited financial statement at that time “showed it to be profitable.”
When asked about the criteria that had to be reached before the nation’s auditor-general is instructed to intervene, Wong responded that it would take meeting a significant threshold encompassing not only investment losses but also signs of negligence and misconduct.
The individual loss, according to Wong, had no effect on Singapore’s reserves’ returns, which are based on long-term returns. Despite being a government-owned company, Tensek is run independently.
Wong emphasized that Singapore just aims to be a responsible and innovative digital asset participant and has no plans to be a crypto activity hub.
According to Wong, blockchain technology can still be used in certain use cases, and the central bank is looking into pilot projects for the financial industry.
Wong added, “Those who trade in cryptocurrencies must be prepared to lose all their value. No amount of regulation can remove this risk.”
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