Founder Thoma Bravo says the firm is getting out of crypto for good after the FTX fiasco

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Thoma Bravo, which manages about $160 billion in assets under management, has decided to exit the crypto market for good following its ill-fated investment in FTX, Orlando Bravo, head of the largest private equity firm, said in a recent interview with CNBC.

The Miami-based tech investor was part of an investor group that led a $900 million investment in FTX in 2021 that valued the exchange at about $18 billion. The company invested approximately $130 million in FTX Trading, the operator and owner of FTX.com.

However, Thoma Bravo, along with other investors, faced substantial losses following the collapse of FTX.

FTX’s downfall began when concerns about its financial practices surfaced, leading to massive customer withdrawals. The situation quickly escalated, with FTX unable to cope with withdrawal requests, which eventually led to its filing for bankruptcy in November 2022.

The exchange was later exposed as a huge house of cards built on fraud, misappropriation of customer funds and a complete lack of competent management and oversight.

In March of this year, FTX founder Sam Bankman-Fried was sentenced to 25 years in prison after being found guilty of all charges.

Following FTX’s collapse, Thoma Bravo and other investors, including Paradigm Operations and Sequoia Capital, faced a lawsuit alleging they made misleading statements while promoting FTX and contributed to its misconduct.

Bravo said the firm would no longer be involved in the crypto sector after losing its bet on FTX.

“Once you make a mistake and once you get burned by something, our philosophy and my philosophy is to never touch it again,” Bravo explained.

Despite the failure with FTX, Bravo still believes in the potential of blockchain technology.

“Personally, I believe in blockchain. I think it’s a powerful way to do many things and for many use cases, and I’ve always believed that,” Bravo said.

FTX bankruptcy nears end with $16 billion fund recovery

The FTX bankruptcy saga is nearing an end, with about $16 billion successfully recovered, ready to repay customers in full, including interest.

The development follows Bankman-Fried’s incarceration at the Brooklyn Metropolitan Detention Center. His co-defendants, Caroline Ellison, Nishad Singh and Gary Wang, also pleaded guilty to federal crimes.

Amid these proceedings, the US Bankruptcy Court for the District of Delaware is scheduled to host a crucial hearing on October 7 to confirm FTX’s Chapter 11 Plan of Reorganization.

If confirmed, the plan will allow more than 98% of customers and unsecured creditors to be repaid in full. However, the repayment calculation, which is based on Bitcoin prices at the time of the bankruptcy, has faced criticism from creditors, challenging the fairness of the proposed plan.

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