Sam Bankman-Fried blames lawyers for FTX collapse

Sam Bankman-Fried, the embattled founder of FTX, has returned to the public spotlight with a new attempt to rewrite the story of his exchange's collapse. In a new statement published on

Lawyers accused of causing the collapse of FTX

Bankman-Fried's post, published on October 30, 2025, argues that FTX's downfall was not caused by mismanagement or fraud but by outside legal advisors who pushed the company into unnecessary bankruptcy proceedings. He claims that if left alone, the exchange could have recovered from its liquidity shortfall and refunded customers by the end of November 2022.

In his 15-page document, Bankman-Fried accuses John J. Ray III and the law firm Sullivan & Cromwell (S&C) of taking control of the company and resold assets such as Solana, Anthropic, and Robinhood stocks at bargain prices. He argues that this process erased enormous value for stakeholders and compounded losses that could have been avoided.

That’s more than $120 billion in lost value so far. $120 billion that should have gone to FTX stakeholders if the debtors had done absolutely nothing.

Sam Bankman-Fried

He argues that the so-called “liquidity crisis” in November 2022 was a temporary cash flow problem, not an actual insolvency. According to him, FTX was in talks to secure $8 billion in funding to cover the shortfall before being forced into bankruptcy.

Bankman-Fried's claims focus on these main accusations:

• Lawyers from Sullivan & Cromwell allegedly improperly pushed the company into bankruptcy.
• The appointed administrators, he says, ousted competent internal teams familiar with the business.
• Key assets were sold below market value, erasing potential future gains.
• The insolvency narrative was deliberately exaggerated to justify third-party control.
• Stakeholders could have been reimbursed in full if FTX had been allowed to continue operations.

Despite this elaborate defense, his statements drew heavy criticism throughout the crypto community.

Bankman-Fried faces backlash after latest FTX claims

Many users on X dismissed his comments as self-centered and out of touch with reality. Critics accused him of trying to justify actions amounting to misuse of client funds and argued that his continued defense only shows that he has not accepted responsibility for the collapse.

Crypto Investigator ZachXBT also repliedarguing that FTX's creditors were repaid based on the prices of cryptocurrencies at the time of bankruptcy, prices which have since risen sharply.

Observers see Bankman-Fried's renewed public comeback as an attempt to reshape public opinion ahead of future legal battles or appeals. His portrayal of FTX as a solvent company destroyed by his lawyers stands in stark contrast to court findings and testimony from former executives, who detailed how billions in customer funds were diverted to cover Alameda Research's losses.

While his latest explanation seeks to reclaim his reputation, many industry voices believe the damage, financial and reputational, is irreparable. The fall of FTX remains one of the biggest corporate collapses in crypto history, leaving users with shattered trust and massive losses.

For many in the crypto community, Bankman-Fried's repeated claims that FTX was financially sound are seen as repetitive and unconvincing. His continued efforts to defend his actions are seen as an attempt to revive a story that most investors and observers consider closed.