Summary
- Sam Bankman-Fried claimed that FTX and Alameda Research were not insolvent during the 2022 liquidity crisis and could have repaid all customer assets.
- Bankman-Fried said the problem was a short-term liquidity shortage, and that after outside legal advisers took over the company, the situation worsened into unnecessary bankruptcy proceedings.
- He said that during the bankruptcy process assets were undervalued and sold below market prices, and a significant amount of FTX Token (FTT) was invalidated.
Sam Bankman-Fried, the former founder of FTX, claimed that "FTX and Alameda Research were never insolvent and could have fully repaid customer assets immediately after the 2022 liquidity crisis.
On the 31st (local time), according to The Block, Bankman-Fried released a 15-page document stating that "FTX held $25 billion in assets and $16 billion in equity at the time of the November 2022 crisis and could easily have handled withdrawal demands of about $8 billion." He added, "FTX's crisis was a short-term liquidity shortage, not insolvency," and "the situation would have been resolved within a month, but outside legal advisers took control of the company and made things worse."
In the document, he criticized John J. Ray III, FTX's new CEO, and the bankruptcy attorneys for driving the company into unnecessary bankruptcy proceedings. He also said the legal team "packaged the company as a 'hopeless pile of garbage' for their own benefit and undervalued the assets."
Bankman-Fried said that $1 billion was paid in advisory fees during the bankruptcy process, FTX Token (FTT) worth $7 billion was invalidated, and assets were sold at prices below market value. He said, "If the assets and the FTX stake held by Alameda had been preserved, the current value would be about $136 billion."
The FTX bankruptcy estate has not issued a separate statement regarding the claim to date.
Son Min
sonmin@bloomingbit.ioHello I’m Son Min, a journalist at BloomingBit
