Tribe Capital just can’t quit FTX: VC burned by SBF is considering an investment in reboot of bankrupt crypto exchange, report says

Tribe Capital, a enterprise capital agency that invested in each the home and worldwide entities of FTX, is weighing whether or not it ought to assist restart the now-bankrupt cryptocurrency alternate.

In January, Arjun Sethi, the agency’s cofounder, met with FTX’s committee of unsecured collectors to speak over the casual proposal, in keeping with these accustomed to the matter, reported Bloomberg. Tribe Capital mentioned main a $250 million fundraising effort, with $100 million from itself and its companions.

The value of an FTT token, the cryptocurrency as soon as issued by FTX, jumped by virtually 19% after the preliminary report Tuesday afternoon, in keeping with information from CoinMarketCap.

FTX’s committee of unsecured collectors nor Tribe Capital instantly responded to a request for remark from Fortune.

“The Committee is working with the Debtors to judge all choices to reboot or promote the FTX exchanges and create worth for collectors,” FTX’s committee of unsecured collectors wrote on Twitter. “There is no such thing as a definitive timetable for a reboot or sale of the exchanges presently.”

The report of Tribe Capital’s curiosity in resuscitating FTX comes after new CEO John Ray III, who has for many years led corporations like Enron by chapter, mentioned in January that he was contemplating relaunching the alternate. He known as FTX “uniquely destined to fail” throughout an look earlier than the Home Monetary Providers Committee.

Tribe Capital, based in 2018, has over $1.6 billion in property underneath administration, together with investments in distinguished crypto corporations like Kraken, one of many largest and oldest cryptocurrency exchanges, and Polygon Labs, the developer behind the favored blockchain protocol Polygon. Tribe Capital invested 2.6% of its deployed capital in FTX, in keeping with The Data.

When FTX went bankrupt in November 2022, Sethi mentioned in an interview with CNBC that on the time of its funding within the alternate “there have been no pink flags.”

Nevertheless, after FTX’s precipitous fall, the variety of pink flags had been evident, sufficient so to warrant a slew of felony investigations into Sam Bankman-Fried, FTX’s founder, in addition to his government administration, together with Caroline Ellison and Gary Wang. Ellison and Wang have since each reached plea offers with the Justice Division.

Final week, Andrew Dietderich, a lawyer for FTX, mentioned in courtroom that the remnants of the bankrupt alternate might use cash marked to repay prospects to relaunch Bankman-Fried’s defunct empire.