Sam Bankman-Fried: “FTX Wasn’t Insolvent… Lawyers Filed for Bankruptcy on Their Own”

Sam Bankman-Fried (SBF), founder of the bankrupt crypto exchange FTX, pushed back against the controversy surrounding himself and FTX.

On the 20th (Korea time), SBF wrote on X (formerly Twitter) that “FTX was not insolvent at the time, and it’s not true that $8 billion disappeared,” adding that “FTX was still solvent and could have repaid customers 119–143% of its liabilities.” He also claimed that “prosecutors, the bankruptcy trustee and the media created this narrative.”

SBF said there were also issues in the decision-making process that led to the bankruptcy filing. He argued that “even though there was a proposal to fill the liquidity gap when withdrawals surged, lawyers filed for bankruptcy,” stressing that “bankruptcy or a liquidity crisis is not a crime.”

SBF also alleged problems in the course of his trial. He said that “after the Department of Justice and the debtors took control of FTX, they controlled evidence and witnesses,” adding that “people who could prove this also stayed silent.”

FTX filed for bankruptcy in November 2022 amid allegations of large-scale misuse of customer funds and a liquidity crunch. U.S. prosecutors later indicted SBF on charges including fraud and conspiracy, and he was sentenced to 25 years in prison. Repayments to creditors and customers are currently under way through the bankruptcy process.