Fallen FTX founder Sam Bankman-Fried has returned to X, insisting his collapsed exchange wasn’t actually insolvent. He’s now claiming that outside lawyers strong-armed the company into filing for bankruptcy.
In a lengthy 15-page document shared from prison, and in follow-up posts on X (formerly Twitter), Bankman-Fried is claiming FTX was never truly insolvent, but rather the victim of hasty legal action that dismantled a recoverable situation.
According to SBF, the fall of FTX wasn’t due to missing funds or mismanagement, but rather a liquidity crunch caused by rapid customer withdrawals, mounting to $5 billion in just two days. He alleges that, at the time of collapse in November 2022, FTX and its trading firm Alameda Research had $25 billion in assets and $16 billion in equity value, which would have easily covered the $13 billion in liabilities.
“FTX always had sufficient assets to repay all customers, in kind, and provide significant value to equity holders as well,” Bankman-Fried wrote, arguing that had lawyers not intervened, the firm would have recovered with customers repaid and shareholder value intact.
He further claimed that “98% of allowed FTX customer claims have already been fully repaid—with interest,” suggesting that the situation could have been resolved without Chapter 11 bankruptcy.
SBF places blame on external counsel and newly appointed FTX CEO John J. Ray III, accusing them of forcing the company into bankruptcy before rescue financing was finalized. He claims their decision turned a temporary liquidity issue into a full-blown financial implosion that ultimately resulted in what he now estimates to be a $100 billion loss in potential value.
He also alleged that the bankruptcy team delayed repayments across 49 countries, all while “paying themselves and the government billions of dollars” from the estate, a claim a judge recently dismissed as premature.
No independent reports or legal filings to date have supported Bankman-Fried’s assertion that FTX was solvent at the time of its collapse. Most investigations have pointed to serious internal failings, including poor controls and alleged misuse of customer funds.
Some analysts suggest Bankman-Fried’s latest comments are aimed at swaying public opinion or perhaps even laying groundwork for a future bid at clemency or a presidential pardon. This speculation gained traction after the recent release of Binance founder Changpeng Zhao and rising chatter on prediction markets about potential pardons.
Despite being incarcerated at a federal prison in California, Bankman-Fried’s online presence has returned in bursts. A recent post of “gm” (crypto slang for “good morning”) led to a sharp 25% spike in FTT (the now-defunct exchange’s native token) before settling around $0.88, still up 10% over 24 hours.
Legal experts, however, remain skeptical about any serious pardon chances. Given Bankman-Fried’s convictions on multiple counts of fraud and conspiracy involving billions in customer losses, any clemency bid would face steep political and judicial hurdles.
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