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Sam Bankman-Fried says FTX’s lawyers overlooked $428 million in cash – and the bankrupt crypto exchange has the funds to make US customers whole


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Sam Bankman-FriedSam Bankman-Fried arrives at a Manhattan federal court in December.

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  • FTX’s ex-CEO Sam Bankman-Fried has doubled down on his claim its US affiliate “was and is solvent”.
  • The collapsed crypto exchange’s new bosses said FTX.US hasn’t got enough funds to return customers’ money.
  • But Bankman-Fried pushed back and said they hadn’t included $428 million of cash in the calculations.

Disgraced former FTX CEO Sam Bankman-Fried has repeated his claim that the US arm of his crypto empire is solvent – meaning it has enough cash to repay customers who lost money when the exchange collapsed.

“FTX US is solvent, as it always has been,” he said on Twitter Tuesday, sharing a link to a Substack post where he questioned recent calculations made by bankruptcy lawyers.

The company’s new bosses have said that FTX.US, which was the failed crypto group’s US exchange, held just $181 million worth of crypto – which wouldn’t be enough to make investors whole.

“Investigation has confirmed shortfalls at both International and US Exchanges,” the exchange’s lawyers Sullivan & Cromwell said in a presentation Tuesday.

But Bankman-Fried said that they hadn’t included $428 million of cash held by FTX US in their calculations, and that that amount of cash would be sufficient to pay back the exchange’s US-based former customers.

“These claims by S&C are wrong, and contradicted by data later on in the same document,” he wrote on Substack. “FTX US was and is solvent, likely with hundreds of millions of dollars in excess of customer balances.”

This isn’t the first time that Bankman-Fried has said FTX.US isn’t facing the same solvency issues as his broader crypto empire.

“This was about FTX International,” he said on Twitter on November 10 when addressing the exchange’s solvency crisis. “FTX US, the US-based exchange that accepts Americans, was not financially impacted by this shitshow. It’s 100% liquid.”

FTX.US filed for Chapter 11 bankruptcy protection in November, alongside FTX International and its sister trading firm Alameda Research, among other companies under the FTX umbrella. The filing came just one day after that tweet.

Authorities in the Bahamas arrested Bankman-Fried the following month and extradited him to the US. Federal prosecutors have charged him with eight counts of criminal activity including fraud, money laundering, and violating campaign finance laws.

The former crypto billionaire writes his Twitter and Substack posts from his parents’ home in California, where he has been made to stay by a US judge while he’s awaiting trial on bail.

Read more: FTX lost $415 million worth of crypto in hacker heists, the collapsed exchange’s new bosses say

Read the original article on Business Insider