Rohit Sipahimalani – CEO of Singaporean public conglomerate Temasek – said the entity is not currently interested in investing in cryptocurrencies due to lack of regulatory clarity.
The company had a bad experience with the digital asset industry, losing $275 million when FTX crashed.
A possible return with appropriate rules
CEO Sipahimalani claims in a recent interview, there is “a lot of regulatory uncertainty” in the cryptocurrency industry, which makes it “very difficult” for Temasek to join the ecosystem with another investment.
On the other hand, he assured that the company would rethink its position if regulators imposed a comprehensive regulatory framework on the industry:
“If you have the right regulatory framework, and we’re comfortable with it, and you have the right investment opportunity, there’s no reason we shouldn’t look into it.”
It is worth mentioning that the Monetary Authority of Singapore has taken some steps to ensure maximum protection for local crypto participants. The watchdog plans to ban digital asset organizations from offering lending and staking services to retail investors. It could also insist that these companies hold customer assets in a designated trust by the end of 2023.
Temasek was among many entities that parted ways with a sizable amount of money due to its interaction with the once-big crypto exchange FTX. The company, which manages nearly $500 billion in assets, has invested $275 million in FTX and lost all due to the latter’s disappearance in November of last year.
Sipahimalani explained that the FTX investment was part of Temasek’s startup strategy, where he doled out funds in “disruptive new technologies to see what’s around the corner.”
The CEO also revealed that the company did its due diligence when considering the decision and moved forward as the market “has good technology, is gaining market share and showing a willingness to engage with regulators and obtain a license”.
The unsuccessful interaction in FTX has damaged the reputation of the Singaporean public conglomerate. Thus, the team and the senior manager who validated the investment assumed full responsibility and saw their annual remuneration reduced:
“The investment team and senior management, who are ultimately responsible for the investment decisions made, have assumed collective responsibility and have had their compensation reduced.”
Temasek did not disclose the exact amount deducted or whether other employees’ bonuses or salaries were reduced.
The long list of companies that have incurred losses due to investing in FTX also includes the world’s largest asset manager – black rockventure capital firm – Sequoia Capital, crypto technology investment firm – Paradigm, Japanese Softbank, and many more.
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