Crypto Investments Weekly – Nov. 5–11

Top investment deals across the crypto sector over the last week (Nov. 5–11, 2022):

Japanese mobile operator NTT Docomo plans up to $4 billion in Web3 investments

Japanese mobile operator NTT Docomo plans to invest up to ¥600 billion ($4.1 billion) over several years to focus on web3 technology, the company said in its second-quarter earnings report.

NTT Docomo expects to invest between ¥500-600 billion in web3 over a five-to-six-year period, the earnings presentation shows for its 2022 fiscal year that ends March 31. The mobile provider disclosed that it also plans to form a web3-focused business in 2023. It listed four key functions related to web3 enablement: A blockchain wallet, crypto asset exchange, token issuance, and security.

Thoma Bravo leads a $70 million round into crypto compliance firm TRM Labs

Private equity firm Thoma Bravo has led a $70 million Series B extension into TRM Labs, which provides risk management and compliance services for financial institutions, crypto companies, and government agencies. Known for its bets on software, Thoma Bravo, which has more than $100 billion in assets under management, previously told The Block about its move towards digital assets and has made investments in FalconX, Figment, and Anchorage.

TRON DAO Reserve to purchase 1 billion USDT

To safeguard the overall blockchain industry and crypto market, TRON DAO Reserve announced it will purchase a total of 1 billion USDT. Users may see the change of balance on USDD.io and all the reserves will be in CEXs, the DAO said.

FTX tapped into customer accounts to fund risky bets before its downfall

FTX’s CEO told investors this week that an affiliated trading firm owes the crypto exchange about $10 billion. Crypto exchange FTX lent billions of dollars worth of customer assets to fund risky bets by its affiliated trading firm, Alameda Research, setting the stage for the exchange’s implosion, WSJ reported.

FTX CEO Sam Bankman-Fried said in investor meetings this week that Alameda owes FTX about $10 billion, people familiar with the matter said. FTX extended loans to Alameda using money that customers had deposited on the exchange for trading purposes, a decision that Mr. Bankman-Fried described as a poor judgment call, one of the people said.

All in all, FTX had $16 billion in customer assets, the people said, so FTX lent more than half of its customer funds to its sister company Alameda.

Scaramucci’s SkyBridge is trying to buy back FTX’s 30% stake

Anthony Scaramucci said SkyBridge Capital is trying to repurchase the 30% of his company that Sam Bankman-Fried’s FTX acquired months before the crypto exchange imploded – an attempt now complicated by FTX’s bankruptcy. According to Bloomberg, FTX Ventures infused cash to fund growth and buy cryptocurrencies. Scaramucci said he feels ‘disappointed,’ ‘duped’ by Bankman-Fried.

Trading firm Genesis to get $140 million equity infusion from parent company DCG

Digital Currency Group (DCG), the parent company of crypto trading firm Genesis, is stepping in to provide a $140 million equity infusion to Genesis after it said that its derivatives business had $175 million locked up on the FTX platform.

The capital infusion will be used to strengthen Genesis’s balance sheet and bolster its position in the crypto market, the firm said in a note sent to a counterparty, which was reviewed by The Block.

Bankrupt crypto lender Voyager reopens bidding process following FTX’s collapse

Bankrupt crypto lender Voyager Digital is ending the deal to sell itself to FTX US after the latter also declared bankruptcy on Nov. 11. In September, FTX paid $1.4 billion to win a bidding war to acquire Voyager’s assets, beating out other crypto firms including rival exchange Binance and digital asset investment firm Wave Financial.

The portfolio of companies is now fessing up to a massive hole of between $10 billion and $50 billion in their balance sheets. A part of that money apparently belongs to Voyager and its customers. In the press release issued Friday, Voyager admitted that it has approximately $3 million currently locked up in FTX, “substantially comprised of locked LUNA2 and locked SRM.”