Dan Loeb, the billionaire founder of hedge fund Third Point, has offered a candid assessment of two very different bets: a roughly $60 million investment in FTX that went to zero, and debt positions in Elon Musk’s X and xAI that became meaningful profit drivers.
Third Point’s Q4 2025 investor letter highlighted the Musk-linked debt investments as significant contributors to the fund’s performance, buoyed in part by the announced merger between xAI and SpaceX. Meanwhile, the FTX chapter remains a painful reminder that even the sharpest institutional investors can get taken for a ride.
The $60 million lesson
Third Point participated in FTX’s funding rounds during 2021, when the crypto exchange was the industry’s golden child. The firm wasn’t alone. Sequoia Capital, Paradigm, and a parade of other blue-chip investors poured money into Sam Bankman-Fried’s operation, collectively endorsing FTX as the future of digital asset trading.
Then November 2022 happened. A liquidity crisis unraveled FTX in a matter of days, and the exchange filed for bankruptcy. Bankman-Fried was subsequently convicted of fraud and conspiracy charges, and Third Point’s roughly $60 million equity stake was valued at exactly nothing.
