FTX Ventures, the venture capital arm of Sam Bankman-Fried’s FTX cryptocurrency exchange, is to buy a 30% stake in the alternative asset manager SkyBridge Capital, founded by Anthony Scaramucci, who briefly worked for President Trump. The terms of the deal were not disclosed, but SkyBridge plans to invest $40 million of the proceeds in cryptocurrencies to hold on its corporate balance sheet.
Historically SkyBridge invested in hedge funds but started getting involved in cryptocurrencies in 2020. According to the New York Times, its main fund, SkyBridge Multi-Adviser Hedge Fund Portfolio, had $2 billion in assets at the end of March but lost a quarter of its value in the second quarter, resulting in investors wanting to withdraw as much as $890 million. However, redemption caps mean the figure will be lower.
At the end of June, 22% of the fund was in cryptocurrency.
In July, Bloomberg reported that SkyBridge halted withdrawals from a smaller fund that invested in private stocks – many of them digital asset related – and crypto. One of the fund’s private stock investments includes FTX.
FTX founder Bankman-Fried has been involved in multiple cryptocurrency acquisitions, particularly since the crypto crash. These include bailing out the high profile cryptocurrency lender BlockFi, extending credit to the bankrupt Voyager Digital and offering to buy some of its assets. FTX also acquired exchanges in Canada and Japan.
In May, Bankman-Fried bought a 7.6% stake in stock trading app Robinhood, and the FTX US exchange started trading stocks in July.
Scaramucci’s SkyBridge is known for the SALT investor conference, where FTX is a multi-year sponsor. Earlier this year, he collaborated with Bankman-Fried and FTX to launch the Crypto Bahamas conference.
“Sam is a visionary who has built incredible businesses that are synergistic with the future of SkyBridge,” said Scaramucci. “We will remain a diversified asset management firm while investing heavily in blockchain.”
FTX US is already trying to get the derivatives rules changed to remove the need to use intermediaries for the clearing of margined products. It has started providing stock broking services, and now with, SkyBridge has a foot into asset and fund management. Soon FTX might resemble a full-service investment bank.
Many predict the convergence of TradFi and DeFi, and this is another mini step in that direction.