An investment management company SkyBridge Capital temporarily suspended withdrawals from one of its funds on July 19. About 20% of the Cayman Islands-based fund is invested in private companies’ stocks. The offshore Legion Strategies fund which requires a minimum investment of $50,000 was exposed to fund vehicles linked to Bitcoin, Ethereum, and Algorand.
Anthony Scaramucci reiterated that the suspension was temporary and the decision was made alongside an independent board. As such, the board decided to temporarily halt redemptions until SkyBridge raises capital within the fund so that when redemptions happen, it happens in an orderly fashion. It outlined that the funds have no leverage and 18% of the fund has crypto exposure.
Scaramucci believes the clients do better through suspensions. He said everyone signed in an investor agreement with this type of flexibility. The executive highlighted that there are no surprises with what’s going on in the broader market. Scaramucci said the good news is that the company is catching a bounce and that things will get better. The firm was optimistic in April 2022 that its assets’ value could grow to $10 billion with cryptocurrencies present in most funds.
Nearly half of SkyBridge’s assets were linked to Bitcoin, Ethereum, and Algorand, as well as other crypto-linked stocks. The firm was hoping to recover from a post-pandemic world with slow economic growth. In June, Scaramucci told investors to stay circumspect.