SBF Challenges FTX Bankruptcy Narrative and Calls for Transparency

• SBF claims FTX was solvent in 2022 and that bankruptcy actions caused massive value losses.
• Creditors allege John J. Ray’s team mishandled FTX assets and incurred record legal costs.
• FTX creditors repaid 120%, but repayments were dollarized, missing crypto price appreciation.

Sam Bankman-Fried, the founder of bankrupt cryptocurrency exchange FTX, issued a public statement on X, addressing ongoing concerns about FTX’s management of creditor funds and the accuracy of the bankruptcy narrative. In his post, SBF noted that while he did not fully agree with every point made about the exchange’s downfall, the general account was mostly accurate.

He stated that the debtors were continuing to withhold creditor funds, including those tied to the case of Mr. Ji and Chinese creditors, which he said required more public attention. The post marked one of SBF’s first detailed comments since his conviction and sentencing earlier this year.

FTX Creditor Alleges Mismanagement in Bankruptcy Process

The renewed discussion followed a post from Arush, an FTX creditor, who outlined allegations against FTX’s current leadership led by CEO John J. Ray III. According to Arush’s post, Ray appeared in court to respond to claims of misconduct, self-approved compensation, and excessive legal spending during the bankruptcy proceedings.

The statement included references to mounting legal and consulting fees that reportedly exceeded $1.5 billion and could surpass $2.5 billion before completion, making the FTX bankruptcy one of the costliest in U.S. financial history.

Arush also claimed that Ray’s team sold several FTX assets, including LedgerX, FTX Europe, and FTX Japan, without full authorization and at values significantly below market rates. He cited the use of estate funds to pursue legal actions against former employees and creditors, while bonuses and board payments were allegedly approved outside of creditor-approved plans. These allegations intensified ongoing debates about whether the FTX estate had managed its remaining assets responsibly since the 2022 bankruptcy filing.

SBF Releases FTX Solvency Report

Following the social media exchange, SBF released a 15-page document titled FTX: Where Did The Money Go?, asserting that FTX was solvent when placed into bankruptcy in November 2022. The report referenced court filings indicating that FTX and its affiliate, Alameda Research, held approximately $25 billion in assets against $13 billion in liabilities at the time. According to SBF’s calculations, if those holdings had been maintained, their combined value, including major stakes in Solana, Anthropic, and Robinhood, would have grown to approximately $136 billion by late 2025.

The document stated that 98% of FTX creditors had received at least 120% of their petition-date claim values, but those repayments were converted to U.S. dollars based on November 2022 prices rather than returned in-kind cryptocurrency.

This conversion, it stated, meant that creditors missed out on the appreciation of assets such as Bitcoin and Solana. Equity investors, who collectively invested $1.95 billion, reportedly recovered only $230 million.

SBF Asserts FTX Was Never Insolvent

In his concluding remarks, SBF maintained that FTX’s downfall stemmed from a liquidity shortage rather than insolvency. The report claimed that the company had sufficient assets to repay customers in full and in kind before external counsel intervened.

It further accused the bankruptcy team of reducing stakeholder value through asset liquidations, excessive fees, and government-related payments totaling more than $17 billion.