Skybridge says that withdrawals from one of its crypto-exposed funds will be stopped.
Skybridge joins other companies that have frozen the funds of crypto investors. However, Skybridge’s CEO, Anthony Scaramucci, says the freeze is only temporary, and there is no danger of the company going out of business.
Skybridge Capital has stopped people from taking money out of its Legion Strategies fund, one of the firm’s crypto-focused funds. The move was confirmed by the company’s founder, Anthony Scaramucci, in an interview with CNBC on July 19. A day earlier, anonymous sources told Bloomberg about the move.
Scaramucci told CNBC, “Our board decided to put a hold on the fund until we can get more money into it. The fund isn’t borrowing money, so there’s no need to worry about it being liquidated. About 18% of the fund is in crypto exposure.” Scaramucci said that art was also taken into account by a separate board.
“Our board made a decision to temporarily suspend until we can raise capital inside the fund and then make sure when people get out they get out orderly,” says @scaramucci. “About 18% of the fund is in what we would call #crypto exposure.” pic.twitter.com/j5AxY871n7
— Squawk Box (@SquawkCNBC) July 19, 2022
Scaramucci said the fund has crypto exposure through Bitcoin (BTC) and FTX stock. Kraken, NYDIG, Helium, Lightning, and Genesis Digital Assets are some other crypto-related companies listed as investments on the Skybridge website that are not directly linked to Legion Strategies. Scaramucci said that the Legion Strategies fund was down 30% this year, but it was up 5% in July.
About Legion Strategies Fund
Scaramucci says that Legion Strategies is a fund based in the Cayman Islands with about $250 million in it. It is one of the company’s smaller funds. Since its start in 1994, this was the first time the fund had been stopped. Skybridge was started on its own in 2005.
Scaramucci told CNBC:
“Everyone signed an investor agreement that allowed for this kind of flexibility, so I don’t think this is a surprise given what’s going on in the market as a whole.”
The United States Securities and Exchange Commission turned down Skybridge’s request to list a Bitcoin exchange-traded fund (SEC).
Skybridge made its first Bitcoin investments in late 2020 and said in April that it was repositioning itself to “eventually be a leading cryptocurrency asset manager and adviser.”
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