- OTPP shuns crypto industry after $95M loss in FTX; CEO stresses caution and member feedback.
- FTX investment by OTPP and other serious investors points to growing adoption of cryptocurrencies.
- OTPP writes off FTX investment; founder faces fraud charges; other Canadian pension funds suffer losses.
The Ontario Teachers’ Pension Plan, which has a total value of $190 billion, has decided to shun the cryptocurrency industry after losing $95 million from its investment in FTX, a defunct digital currency exchange, reports the Financial Times.
In 2021 and early 2022, the Ontario Teachers’ Pension Plan (OTPP) joined other well-known money managers who invested in FTX. Many saw this as a sign that serious, high-profile investors were supporting the rapidly expanding, if lightly regulated, cryptocurrency industry.
In November 2022, OTPP wrote off its investment in FTX entirely after the exchange suffered a significant drop. FTX’s prominent founder, Sam Bankman-Fried, is currently facing fraud charges.
OTPP managing director Jo Taylor added,
We are still working on what exactly happened there and you will be careful.
In addition, the Ontario Teachers’ Pension Plan (OTPP) is shunning the crypto sector after writing off its $95 million investment in FTX, a failed digital currency exchange. Although it was a relatively small investment, OTPP, along with other FTX supporters, came under scrutiny for investing in a company whose founder is accused of fraud and embezzlement. OTPP CEO Jo Taylor has explained the importance of exercising caution and considering member feedback when making future crypto investments.
According to OTPP CEO Jo Taylor, the fund conducted extensive due diligence on FTX before investing and is now avoiding the cryptocurrency industry after the investment failed. Taylor also stated that OTPP did not receive all the necessary information to make an informed decision.
Other Canadian pension funds, such as the Caisse de dépôt et placement du Québec, also suffered losses in the crypto sector. The latter wrote off a $150 million investment in Celsius. Taylor acknowledged that the OTPP has learned from experience and regrets members’ losses.