Steven Mnuchin's private equity firm Liberty Strategic Capital passed on backing the notorious cryptocurrency exchange FTX twice as the exchange's value was growing too fast, the former Treasury Secretary told CNBC.
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He said that his firm "looked at investment twice, and passed both times," adding that the second time Liberty Strategic Capital passed on making an investment, FTX's valuation surged fivefold than it had been before.
"We were a bit surprised by the overall level of valuation," Mnuchin said.
Mnuchin also said he did not expect how quickly events around FTX would unwind, adding that "there needs to be more clarity on regulation."
In early November, Binance publicly announced plans to liquidate FTT from its reserves due to "recent revelations that have came to light." Although Binance's CEO, Changpeng Zhao, declined to explain what was the trigger behind the move, he had pointed out that the exchange "won't support people who lobby against other industry players behind their backs," referring to FTX.
Later, CZ publicly announced that Binance signed a letter of intent to acquire FTX, but soon walked away from the deal, citing "news reports regarding mishandled customer funds and alleged US agency investigations."
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