Sam Bankman-Fried denies stealing crypto from user FTX in new Substack post

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Former FTX chief executive Sam Bankman-Fried (C) arrives to plead before U.S. District Judge Lewis Kaplan in federal court in Manhattan, New York, January 3, 2023.

Timothy A. Clary | AFP | Getty Images

His post gives his perspective on the collapse of FTX and its hedge fund Alameda Research, and includes purported financial metrics from FTX and Alameda, referred to as “JUST AN ESTIMATE”.

At the start of 2022, for example, Bankman-Fried says it estimated Alameda’s total net assets at $99 billion. In October, he thought his hedge fund’s net assets had fallen to $10 billion. He attributed the collapse to a broader market slowdown, even comparing the performance of his FTT token to that of Tesla, bitcoin and Invesco QQQ, an ETF that tracks the Nasdaq 100.

Bankman-Fried compared the performance of the token on his exchange with the Invesco QQQ and other assets in his Substack post.

Bankruptcy attorneys, federal prosecutors and regulators have contradicted many of Bankman-Fried’s claims in her post.

Regulators and prosecutors allege that neither FTX nor Alameda were entirely legitimate companies, but were instruments of the Bankman-Fried fraud.

FTX restructuring officials said the companies faced large and inexplicable cash shortfalls after FTX filed for bankruptcy in November.

The case against Bankman-Fried was built with the help of its longtime executives Caroline Ellison and Zixiao “Gary” Wang, who both pleaded guilty to fraud charges. Bankman-Fried’s message did not acknowledge their cooperation with federal investigations.

In his post, Bankman-Fried also noted that other crypto companies have been “blown”. He did not acknowledge that three of those companies, BlockFi, Genesis and Gemini, would have suffered from the collapse of FTX.

Many of his assertions were those he had made before, including that FTX US remained solvent, that Alameda’s liquidity crisis was not due to misconduct but to broader market turmoil, and that FTX International and Alameda were completely legitimate and profitable companies.

The former FTX CEO also pointed to a November 6 tweet from Binance’s Zhao as the culmination of a “huge month-long PR campaign against FTX.”

Zhao denied these claims. “FTX committed suicide […] because they stole billions of dollars,” the Binance CEO tweeted in December.

At the end of the post, Bankman-Fried doubled. “All this to say: no funds were stolen,” wrote the 30-year-old.

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