Sam Bankman-Fried, the founder and former chief executive of FTX U.S., has rejected claims by the company’s current leadership made in a presentation on Tuesday that the team has only recovered US$181 million worth of funds from the exchange.
See related article: FTX says US$415 mln in crypto hacked since bankruptcy filing
Fast facts
- Current FTX chief executive, John J. Ray III, said half of those funds were lost to unauthorized transfers following FTX.com filing for Chapter 11 bankruptcy on Nov. 11.
- “These claims by [restructuring firm Sullivan & Cromwell] are wrong, and contradicted by data later on in the same document,” Bankman-Fried wrote in a Substack post on Wednesday. “FTX U.S. was and is solvent, likely with hundreds of millions of dollars in excess of customer balances.”
- FTX U.S., established in 2020 to cater to U.S.-based customers, is a separate entity from the Bahamas-based crypto exchange FTX.com.
- Bankman-Fried is currently under house arrest for his involvement in the collapse of FTX.com and faces charges of securities fraud, wire fraud, conspiracy, money laundering, and violating campaign finance rules. He has pleaded not guilty to all charges.
- He launched a Substack on Jan. 13, an online, personal newsletter that users can subscribe to.
- In this recent post on Substack, Bankman-Fried gives lengthy explanations for how he believes FTX U.S. is still solvent. However, as Ray has been distancing himself and the company from its former head, it is possible Bankman-Fried does not have access to the most up-to-date information.
- FTX leadership told creditors on Tuesday that US$415 million had been lost to hackers since the Nov. 11 bankruptcy filing, of which US$90 million had been siphoned from FTX US.
- Roughly US$5.5 billion worth of liquid assets have been marked for recovery by FTX consisting of US$1.7 billion in cash, US$3.5 billion in cryptocurrencies – including FTX Token (FTT) – and US$300 million worth of liquid securities.
See related article: US lawyers, Bahamas liquidators trade barbs over who rules FTX bankruptcy jurisdiction