Ontario Teachers’ Pension Plan (OTPP), Canada’s largest single profession pension plan, decided not to rush into another cryptocurrency investment after its bad experience with FTX.
The organization was among the prominent backers of the now-bankrupt exchange, investing $95 million. However, the dramatic fall reduced that sum to practically zero.
Change of mind after FTX implosion
Jo Taylor – Executive Director of the $190 billion pension plan – said the Financial Times that the entity will refrain from making investments in cryptocurrencies due to the losses caused by the collapse of FTX. He said the decision was based in part on “feedback from our members,” who were presumably critical of the fund’s initial interaction with the crashed platform:
“We have had some lessons from investing. We have received feedback from our members. We regret any loss on your behalf.”
OTPP has previously shown support towards FTX, making two separate investments in 2021 and early 2022 for a total of $95 million. Back then, the exchange was among the leaders in its field while the crypto market was on a bull run.
While the fund’s investment represented less than 0.05% of its total assets, OTPP faced criticism (like many others) for dealing with a company whose founder, Sam Bankman-Fried (SBF), is accused of fraudulent activity.
Numerous failed agencies and investors took turns naming the former FTX CEO as the main culprit behind the disappearance, arguing that his goal was to embezzle client assets.
After spending a brief time in a Bahamian jail late last year (shortly after the collapse), he was deported to the United States. However, the local authorities permitted to live in his parents’ house on a whopping $250 million bail.
A trial set for early October will determine if he had anything to do with the incident and will rule out his possible sanction. If he is found guilty, the 31-year-old could spend his life behind bars.
Lost CDPQ funds due to Celsius
Another Canadian pension fund giant that had a bad experience in the cryptocurrency field last year is Caisse de dépôt et placement du Québec (CDPQ). He lost $150 million after investing in Celsius cryptocurrency lending platform. Chief Executive Officer Charles Emond noted that his entity had carried out proper due diligence before jumping on the bandwagon, though he still parted ways with the sum:
“The due diligence was quite extensive, with many experts and consultants involved. The team entered cautiously. We had a 4% equity interest. The conversations we had internally were pretty straightforward. The teams are responsible for that.”
Celsius filed for Chapter 11 bankruptcy protection in the US last summer after pausing withdrawals. Like OTPP, CDPQ vowed to stay away from any forays into crypto following the failed investment.
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This post Canada’s Largest Pension Fund Will Stay Away From Cryptocurrencies After Canceling FTX Investment
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