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SBF: FTX was never truly insolvent; the core issue was a liquidity crunch at the time of filing for bankruptcy.
BlockBeats News, October 31, FTX founder Sam Bankman-Fried (SBF) released a report titled "FTX: Where Did The Money Go?," stating that customers of the cryptocurrency exchange FTX are expected to receive a USD-denominated payment of 119% to 143% of their principal, meaning all creditors will "fully recover" their funds. FTX was never truly insolvent, and the funds were sufficient at the time of bankruptcy.
According to the data, the total assets of FTX at the time of the bankruptcy filing in November 2022 were approximately $15 billion, including cash, crypto assets, investments, and real estate, enough to cover the customers' debt of about $8 billion. The significant issue FTX faced at the time was liquidity stress rather than asset insolvency. If not forced into receivership, the company's original system could have resumed withdrawals and operations within that year.
Since the bankruptcy, legal and advisory fees have accumulated to over $1 billion. More importantly, customer payments were calculated in USD equivalent based on the coin price in November 2022, such as around $17,000 for Bitcoin at the time, while the current price has exceeded $100,000. Although customers were nominally compensated "excessively," they actually missed out on two years of market gains.
If FTX had not gone bankrupt and still held the original assets to this day, the overall asset value would have exceeded $130 billion, with shareholder equity reaching $110 billion. In contrast, current shareholders can only recover about 10% of their invested capital, and the company's valuation is nearly zero.
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