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Hedge Fund Loses Majority of Funds Because of FTX Bankruptcy

Summary:
As contagion fears around FTX’s collapse continue to spread, one hedge fund manager has already admitted that his business is virtually ruined. Travis Kling – Chief Investment Officer of Ikigai – said on Monday that the crypto asset management firm lost a “large majority” of its funds on FTX. As explained on Twitter, Ikigai was able to withdraw “very little” of its reserves from holdings from the company when it attempted to do so last Monday. “We’re now stuck alongside everyone else,” said Kling.  FTX was hit by overwhelming withdrawal demand last week after statements from Binance CEO Changpeng Zhao sparked rumors about the former exchange’s insolvency. FTX entirely froze withdrawals the following day, and later filed for bankruptcy.  Despite FTX’s potentially criminal

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As contagion fears around FTX’s collapse continue to spread, one hedge fund manager has already admitted that his business is virtually ruined.

Travis Kling – Chief Investment Officer of Ikigai – said on Monday that the crypto asset management firm lost a “large majority” of its funds on FTX.

  • As explained on Twitter, Ikigai was able to withdraw “very little” of its reserves from holdings from the company when it attempted to do so last Monday. “We’re now stuck alongside everyone else,” said Kling. 
  • FTX was hit by overwhelming withdrawal demand last week after statements from Binance CEO Changpeng Zhao sparked rumors about the former exchange’s insolvency. FTX entirely froze withdrawals the following day, and later filed for bankruptcy
  • Despite FTX’s potentially criminal actions, Kling took the blame for his customers’ loss. 
  • “I lost my investors’ money after they put faith in me to manage risk and I am truly sorry for that,” he said. “I have publicly endorsed FTX many times and I am truly sorry for that. I was wrong.”

  • Kling said his fund will likely continue trading the assets that it has left, but is unsure about its future as a whole. 
  • He added that he was feeling “disgusted” by the current state of the crypto industry, including the “sociopaths” that have been allowed to deal damage to it.

“It’s obvious now that the space has not done enough to identify and expel bad actors. We’re letting way too many sociopaths get way too powerful and then we all pay the price,” he said.

  • Kraken CEO Jesse Powell made similar comments about former FTX CEO Sam Bankman-Fried last week, calling him out for his “sociopathic” behavior. 

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