SkyBridge Capital is a global multi-asset class alternative investments firm specialising in hedge fund solutions and opportunistic investment vehicles. Anthony Scaramucci, the former Trump aide and co-founder of Oscar Capital Management, founded the firm in 2005.
Crypto Lists report that its portfolio consists of commingled funds, separately managed accounts, digital asset investments, and an Opportunity Zone REIT. There is also a Special Purpose Vehicle fund for late-stage private technology companies.
SkyBridge Capital also produces the SkyBridge Alternatives Conference (SALT) conference. It is a large annual thought-leadership event in the U.S as a capital introduction convention.
FTX ventures is the investment arm of FTX crypto exchange managed and operated by billionaire Sam Bankman-Fried. It has made significant strides in the venture capital space after FTX unveiled it in January 2022. At the time, it was unveiled as a $2 billion venture capital fund supporting digital asset investments from the world’s best teams, built-in crypto, and Web3. FTX ventures have provided flexible funding and strategic support from its network of global partners to help bail out firms lacking liquidity, but not assets.
FTX Ventures Investment in SkyBridge Capital
FTX ventures continue its investment spree by scooping up a 30% stake in SkyBridge Capital. The announcement from both companies is to provide additional working capital to SkyBridge Capital to fund growth initiatives and new product launches in addition to the acquisition. SkyBridge Capital pivoted to crypto from traditional hedge funds during the recent bull run with plans on a Web3-dedicated fund to invest in late-stage crypto companies. Crypto Lists believes it may announce these plans during SkyBridge’s annual Salt conference.
SkyBridge Capital was affected by the crypto down cycle and sharp declines in July prompted SkyBridge Capital to suspend redemptions from a fund with exposure to FTX but the firm insists it is still profitable and without debt. Scaramucci is still bullish on Bitcoin long term and indicated that it would use a part of the amount received to purchase $40 million in cryptocurrencies as a long-term investment to hold on its corporate balance sheet.
This deal is the latest collaboration between the two firms after the multi-year partnership to sponsor global SALT conferences in Asia, North America, and the Middle East, as stated by SkyBridge Capital. The collaboration of the firms will expand across current and future product offerings. SkyBridge will remain a diversified asset management firm while investing heavily in blockchain.
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SkyBridge Capital intends to works closely with FTX ventures to move forward with its crypto investment activities. FTX ventures also plan to work with SkyBridge on potential non-crypto-related investments. FTX Ventures took a 30% stake in Scaramucci’s SkyBridge Capital, as the companies announced on Friday morning. The agreement is essential as it cements FTX ventures as the renowned dealmaker during the crypto downcycle. There were no disclosures on the financial terms of the deal by both firms.
Why did FTX buy into SkyBridge?
A couple of months back, SkyBridge Capital had suspended redemptions from its Legion Strategies fund-of-funds that invested in bitcoin, Ethereum, and other digital assets during the last bull cycle. The suspension comes from a liquidity mismatch that results from late-stage private investments in the fund. The firm’s fund has no leverage, and there is zero risk of any asset liquidation.
SkyBridge Capital needs the investment due to its profitability reduction, debt increase, and problems withstanding market conditions.
FTX ventures have been active both as an investor and acquirers of crypto firms amid the recent crypto downturn. It decided to save SkyBridge from bankruptcy and add value to its business. The firms wanted to cooperate, facilitate their dealership, and show it could benefit them and provide a healthy crypto industry.
SkyBridge went through a rough patch, and their crypto investments have crashed in value triggering an investor exodus. The crypto winter wiped out approximately $2 trillion in market value in the past ten months. FTX Ventures has tried to save it through a strategic assist to all businesses and expand the empire while moving to products such as stocks and options.
What is the future for FTX Ventures and Skybridge?
The investment will strengthen both in the long run. The future holds that the investor will expand their non-crypto-related investments. SkyBridge Capital will come out of bankruptcy and it will soar in the cryptocurrency world. The partnership will bring these firms together in expanding their digital asset investment, giving mutual benefits.
Some believe that the FTX venture’s investment in SkyBridge Capital is not an altruistic gesture. FTX ventures have come to the rescue of several stakeholders in the crypto industry, especially digital currency platforms as crypto prices had a severe downturn this year. FTX stated it still had a few billion to assist struggling firms that could further destabilize the digital asset industry. Crypto Lists keeps tabs on the impact of FTX venture investment in the crypto industry.
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