In a direct challenge to the official narrative of FTX’s collapse, disgraced founder Sam Bankman-Fried (SBF) and his team have asserted that the cryptocurrency exchange was never truly insolvent and “always had enough assets to repay all customers—in full, in kind.”
In a document dated September 30, 2025, Bankman-Fried contends that the $8 billion owed to customers at the time of the November 2022 bankruptcy “never left.” He frames the catastrophic event not as a balance sheet gap, but as a classic “run on the bank” triggered by panic withdrawals.
The statement argues that Bankman-Fried’s initial claims of solvency have been validated by the estate’s current recovery success.
Recovery Success Vindicates Solvency Claim
The document highlights the remarkable turnaround in the bankruptcy proceedings:
- Projected Payouts: Bankman-Fried claims customers will receive between 119% and 143% of what they were owed at the time of the bankruptcy filing.
- Current Holdings: After covering the initial $8 billion in customer claims and an estimated $1 billion in legal fees, the estate still reportedly holds around $8 billion in assets.
- Repayment Status: Approximately 98% of customers are already slated to be repaid 120% of their claim value.
SBF’s camp maintains that customer withdrawals, which spiked to billions in days, caused a liquidity crunch that could have been bridged by late November 2022 through deals that were already in motion—had the company not been forced into bankruptcy.
Allegations of Value Destruction and Mistimed Sales
While celebrating the high recovery rate, Bankman-Fried and his team heavily criticize the subsequent decisions made by the bankruptcy team, arguing they led to massive value erosion and prolonged delays.
The document specifically points to the sale of assets that later soared in value, denying the estate, and thus customers, significant upside:
- Key Assets Cited: Stakes in tokens and private companies, including Solana, Sui, and Anthropic, were allegedly sold prematurely, missing a major market rebound.
- Insider Pricing: The document alleges the asset sales were subject to “insider-favored pricing” and that heavy professional fees further drained the estate’s resources.
The Dollarized Payout Controversy
The former CEO also takes aim at the decision to issue payouts based on the U.S. dollar value of crypto as of November 11, 2022, rather than returning the cryptocurrencies themselves.
This approach, the paper argues, effectively denies creditors the upside from the significant market rally that followed the collapse, compounding the gap between petition date prices and current market levels for assets like Bitcoin and Ethereum.
Despite the ongoing legal battles—Bankman-Fried was convicted on seven counts in 2023 and received a 25-year sentence in March 2024 (a judgment he is currently appealing)—the eventual near-full recovery of customer funds based on petition-date values sets a rare precedent for major crypto bankruptcies worldwide.
The success of the recovery, however, now fuels a debate that Bankman-Fried is actively attempting to reshape: whether the estate’s strategy of early asset monetization was necessary for speed and certainty, or a costly mistake that liquidated assets at the market bottom.
