Canadian pension fund says they will write off $95 million stuck on FTX

Summary:

  • Ontario Teachers’ will write off a $95 million investment in troubled crypto exchange FTX.
  • The pension fund announced the decision as Sam Bankman-Fried’s companies filed for bankruptcy in Delaware and New York.
  • Another firm wrote off $150 million stranded on Celsius after the crypto lender collapsed in June.

Ontario Teachers’ does not plan to pursue recovery of its $95 million investment in crypto exchange FTX. According to the announcement, the giant Canadian pension fund will write off its entire assets left in limbo on the platform.

we are disappointed with the outcome of this investment, take all losses seriously and will use this experience to further strengthen our approach.

Despite the large holdings on Sam Bankman-Fried’s exchange, Ontario Teachers’ boasts one of the biggest balance sheets among Canadian pension funds. Since the fund has approximately $250 billion in assets under management(AUM), holdings on FTX represent less than 1% of the pension giant’s books.

Notably, the announcement echoes similar events from contagion after Terra’s $40 billion implosion. At the time, another large Canadian fund – Caisse de Depot et Placement du Quebec – lost $150 million after Celsius froze customer assets and filed for bankruptcy. 

The pension manager, like Ontario Teachers’, wrote off the investment. Several other companies within and outside the crypto ecosystem have also disclosed some exposure to FTX including Genesis Global Capital.

Creditors Not Waiting For FTX Bankruptcy Outcome

The decision to write off the funds perhaps signals a lack of faith in the ongoing bankruptcy proceedings. While bankruptcy proceedings typically take a few years, the FTX filing recently published revealed shady accounting techniques and points to multiple unprofessional practices.

Indeed, the newly appointed CEO John Jay Ray III – a veteran financial advisor who played a crucial role in resolving the Enron debacle – referenced the FTX case as the worst he has seen in over 40 years in finance.

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