More Losses For Tiger Global From Its FTX Investment

Tiger Global Management appears to have just taken another hit.

The hedge fund headed by billionaire Chase Coleman has been among the most prominent investors in Sam Bankman-Fried’s FTX crypto exchange.

On Tuesday, Binance CEO Changpeng Zhao tweeted that his firm was buying FTX’s non-U.S. businesses to rescue it from what he said was a “significant liquidity crunch.” According to Zhao, commonly known as CZ, the two firms signed a non-binding letter of intent, subject to Binance conducting due diligence over the coming days. Bankman-Fried used Twitter to confirm a “strategic transaction” with Binance.

While terms of the deal weren’t announced, the sudden need to be rescued and emergency bailout of FTX likely spells trouble for those who invested in the exchange’s latest fundraising rounds. Binance, in an email to Forbes, said it had no further updates on the deal. FTX didn’t respond to a request for comment.

Prior to reaching an agreement with Binance, FTX was said to be seeking outside capital at a valuation of $10 to $20 billion, according to the Block. That would be far below the valuations Tiger paid to align itself with Bankman-Fried.

Tiger was part of a group of investors in FTX’s January Series C round that valued the company at $32 billion. It previously also participated in a Series B round that valued FTX at $25 billion. During that raise, FTX took a page out of Elon Musk’s playbook by raising exactly $420.69 million.

How much Tiger invested with FTX is unclear. Tiger Global declined to comment.

On Monday, the Financial Times reported that Tiger’s flagship hedge fund was down 54.7% this year as bets on tech and Chinese stocks have gone sour.

Another Tiger fund, which includes public equities and private equity investments, was said to be down 44%. It’s unclear whether the firm’s investment in FTX was included in the fund.

Tiger had about $40 billion invested in private equity as of this summer, according to the FT.

Tiger also invested alongside FTX’s venture capital arm. In April, Tiger led a $350 million funding round for the NEAR protocol of which FTX Ventures also participated. Tiger and FTX also co-invested in a $22 million raise for Meow, a crypto yield platform, in July.

Other prominent investors in FTX’s latest rounds include SoftBank, Sequoia Capital, Ribbit Capital, BlackRock, Temasek Holdings, and the Ontario Teachers’ Pension Plan Board.