FTX Liquidators Offloaded $500M AI Stake in Cursor—Now It’s a Unicorn

FTX’s fire sale just got more painful. Liquidators dumped a half-billion-dollar stake in AI startup Cursor during the bankruptcy scramble—only to watch it skyrocket to a multi-billion valuation.

The ultimate ’sell low’ move

While Wall Street hedgies brag about their AI bets, FTX’s estate managed to fumble one of the decade’s hottest tech plays. Cursor’s tech—a code-generating AI that’s eating GitHub’s lunch—now has VCs throwing term sheets like confetti.

Lesson learned?

When crypto bros play traditional finance, everyone gets burned. Except the lawyers—they always win.

Crypto never sleeps, and neither do its billion-dollar blunders. 

According to Wu Blockchain, AI code editor Cursor just closed a jaw-dropping $900 million funding round at a $9 billion valuation. 

According to FT, AI code editor Cursor has completed $900 million in financing, with a valuation of $9 billion. Alameda invested $200k in its seed round in 2022, but was sold by FTX liquidators for $200k. The stake may currently be worth around $500 million.… pic.twitter.com/sf53q1FvxR

But while top VCs like Thrive Capital, a16z, and Accel are celebrating, there’s one name glaringly missing from the winners’ circle: FTX. Here’s why.

From $200K to $500M: What Went Wrong?

Back in 2022, Alameda Research – FTX’s sister trading firm – quietly invested $200,000 into Cursor’s seed round. Fast forward to today, and that stake could be worth an estimated. 

Unfortunately for FTX creditors, the platform’s liquidators sold it off for the exact amount it was purchased at: $200,000. No markup.Just a clean exit… from half a billion dollars in potential recovery. Ouch, right? 

Cursor’s Impressive Rise 

Cursor, built by Anysphere Inc., is trying to redefine how developers write code. With a sleek split-screen interface and AI-powered chatbot, Cursor allows users to automate complex coding tasks using simple natural language prompts. It analyzes, breaks down tasks, fetches context from documentation, and applies real-time changes.

Its engine runs on models from OpenAI and Google, along with its own internal model, Cursor-Fast. And with over $200 million in annual recurring revenue, the momentum is great. 

FTX’s Loss, Big Tech’s Gain?

This funding round wasn’t too hush-hush. Thrive Capital led the $900M investment, the same firm that backed OpenAI’s $6.6B round last year. 

The buzz? OpenAI reportedly tried – and failed – to acquire Anysphere earlier this year. They’re now eyeing Windsurf (Exafunction Inc.) for up to $3 billion instead.

This seems like a major loss for FTX. Is there more than meets the eye? Guess we’ll know with time.