SBF Labels FTX Collapse a ‘Liquidity Crisis’ and Seeks Pardon

Sentenced to 25 years in prison, FTX founder Sam Bankman-Fried (SBF) reiterated in an interview with The New York Sun that at the time of its collapse, the exchange was solvent but illiquid. He added that the law firm Sullivan & Cromwell mishandled the bankruptcy proceedings. 

“At that time, there were enough assets to pay all customers. The problem was that the liquidity crisis caused market panic and made it impossible to quickly cash out funds,” explained SBF.

Bankman-Fried’s first interview from prison coincided with FTX’s client repayments, which the company claims will cover all lost funds. However, the compensation is calculated based on cryptocurrency prices at the time of the exchange’s collapse in 2022, drawing criticism from those affected.

While a significant portion of investments by Alameda Research and FTX, including a stake in the startup Anthropic AI, have paid off, clients need their money “immediately, not years later.” SBF asserts he had evidence that he did not misappropriate billions of dollars of user funds and that cash was available.

He also reiterated the argument that “borrowing and lending” were part of FTX’s margin trading platform, not evidence of theft, and that the exchange only “appeared” insolvent. 

The FTX founder appealed to U.S. President Donald Trump for a pardon. SBF claimed his criminal case resulted from political pressure by the administration of former President Joe Biden.  

In the early days of his return to the White House, Trump pardoned Silk Road darknet market founder Ross Ulbricht. The fulfillment of one of the campaign promises by the head of state caused a stir among “white-collar” convicts.

On February 20, Ulbricht published a post urging the release of Bitcoin.com founder Roger Ver, detained last year in Spain on U.S. Justice Department charges of tax fraud.

Roger Ver was there for me when I was down and needed help. Now Roger needs our support.

No one should spend the rest of their life in prison over taxes. Let him pay the tax (if any) and be done with it. #FreeRoger pic.twitter.com/flP573hm0N

— Ross Ulbricht (@RealRossU) February 20, 2025

Bankman-Fried was the second-largest donor to Biden’s 2020 presidential campaign. However, in the interview, he emphasized that he supported both parties, using “dark” funds to finance Republicans.

SBF stated he was disillusioned with the Democratic Party and added that Republicans, including Trump, take a more constructive stance on many issues.

In November 2023, a jury found SBF guilty on all seven charges. In March 2024, the Southern District of New York court sentenced the entrepreneur to 25 years in prison. He immediately filed an appeal.