Former FTX CEO Sam Bankman-Fried has reiterated claims that FTX US is solvent after recent statements to the contrary by FTX’s debtors.
According to Bankman-Fried, the group failed to account for customers’ bank balances, leaving the US unit’s assets significantly higher than its liabilities to customers.
Clear the air on FTX US
in Subsystem entry On Wednesday, Bankman-Fried said some statements made on Tuesday by Sullivan and Cromwell (S&C; one of the law firms handling FTX’s bankruptcy) were “extremely misleading” because they relate to the solvency of FTX US.
At the time, the law firm reported that the assets it was able to determine belonged to the exchange were “significantly less than the total third-party client balances suggested by FTX US’s electronic ledger.” In a separate filing, the company also argued that there was a significant shortfall of assets in both FTX International and FTX US.
“These allegations by S&C are untrue and contradict statements later in the same paper,” Bankman-Fried said. “FTX US has been, and continues to be, solvent, possibly hundreds of millions of dollars in excess of customer balances.”
Bankman Fried said Same story About the American Stock Exchange before and after FTX Group filed for bankruptcy in November, as both exchanges’ assets were separated. Likewise, John J. Ray III – the new president of FTX, pending bankruptcy – Tell Congress announced last month that FTX’s U.S. assets are separate from those of Alameda Research, with which FTX International has pooled its funds.
In fact, Bankman-Fried has claimed that FTX US has a positive balance sheet in the region of $400 million in excess cash. He reached that figure by including $428 million in US FTX bank accounts as an asset – something he said Cromwell had failed to do.
Specifically, the law firm filed client balances of $497 million, which exceeds the $181 million in digital assets identified by FTX US in relation to the exchange. Thus, Cromwell concluded that FTX has a large asset deficit. However, when you include the stock exchange bank account balance, that deficit becomes a surplus.
In addition, Bankman-Fried disputed that the customer balance of $497 million was obsolete, before FTX US experienced massive withdrawals. In fact, the figure was believed to be around $199 million.
Bankman-Fried compared $609 million in total cash and digital assets with a customer balance of $199 million, and concluded that FTX US had “at least $111 million and possibly about $400 million” in excess cash prior to the bankruptcy.
“US FTX is solvent,” he said. “Customers should be given access to their money.”
Of the $181 million in digital assets identified as being associated with FTX US, $90 million has it MissingAccording to the debtors of the stock exchange on Tuesday.
Bankman Fried has it Not guilty On charges of fraud, conspiracy to launder money and other charges indicating that he defrauded investors. In contrast, former Alameda Research CEO Caroline Ellison, as well as former right-hand man of Bankman Fried, Gary Wang, Admission of guilt with a similar fee.
Sam Bankman-Fried Post Maintaining FTX US Is Solvent, Debtor Claims appeared first on CryptoPotato.