SBF Asserts FTX Was Solvent, Cites Liquidity Crisis as Real Culprit

Sam Bankman-Fried, the disgraced founder of collapsed crypto exchange FTX, has reignited controversy by asserting in a recent document that the platform was never insolvent at the time of its 2022 collapse. The claims, posted on social media and detailed in a 30-page analysis, challenge the widely accepted narrative that FTX's insolvency triggered its bankruptcy filing and the subsequent $8 billion shortfall for customers.

SBF's argument hinges on financial figures he claims demonstrate FTX's solvency. According to his report, the exchange held $25 billion in total assets and $16 billion in equity as of November 2022, far exceeding its $13 billion in liabilities. This, he contends, means FTX could have repaid all customers in full and even retained surplus funds. "The crisis FTX faced was a liquidity crisis, not a solvency crisis," the document states, emphasizing that the exchange's inability to meet short-term cash demands-not a lack of overall assets-led to its downfall.

The liquidity crunch, SBF argues, was on the verge of resolution until external legal counsel intervened and initiated bankruptcy proceedings. He criticizes the appointed bankruptcy team, including CEO John Ray III, for allegedly misrepresenting FTX's financial health and liquidating assets below market value. "The Debtors were incentivized to file for bankruptcy and portrayed the company as a 'dumpster fire,'" the document alleges, claiming that these actions "decimated" FTX's value.

The bankruptcy estate, however, maintains that FTX's declared insolvency remains the foundation for ongoing creditor recovery efforts. As of 2025, the estate has repaid 98% of creditors at 119–143% of their original claims, with $136 billion in assets now under management. Critics of SBF's claims, including blockchain investigators like ZachXBT, argue that his assertions ignore the reality of November 2022, when FTX's liquidity collapse exposed a $8 billion hole in customer funds.

SBF's legal team has also linked his claims to broader political efforts, including a push for a presidential pardon from Donald Trump. Prediction markets like Polymarket now price a 15.5% chance of his release in 2025, a spike fueled by Trump's recent pardon of Binance founder Changpeng Zhao; Polymarket bets earlier surged to 12% before the recent move. Yet legal experts remain skeptical. "SBF's name is a punchline in Washington," said crypto lawyer Jake Chervinsky, noting the former FTX CEO's 25-year fraud conviction and political ties to Democrats.

The debate over FTX's solvency intersects with wider questions about accountability in crypto. While SBF insists the bankruptcy team's actions exacerbated losses, the estate's administrators argue that liquidation was necessary to recover assets for creditors. "FTX's equity and crypto holdings have surged in value since 2022," a court filing noted, "but that doesn't negate the initial insolvency".

As the FTX bankruptcy enters its third year, the clash between SBF's narrative and the official record underscores the complexity of crypto's high-stakes failures. With creditors set to receive final payouts and political speculation over pardons intensifying, the saga continues to shape perceptions of transparency and justice in the digital asset sector.

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