FTX Was Not Insolvent, Lawyers Lost $66B

Documents posted to Sam Bankman Fried’s X account claim that the defunct FTX cryptocurrency exchange was never bankrupt and that its lawyers’ decision to force it into bankruptcy cost investors $66 billion.

The document, purportedly written by Bankman Fried and his team, claims the exchange faced only a temporary liquidity crisis that was “scheduled to be resolved by the end of the month” before outside lawyers intervened. It accuses Sullivan & Cromwell and former FTX executives of collaborating to seize control of the company.

The documents say the lawyers were given “strong incentives” to force FTX into bankruptcy so they could oversee its assets, a move they say derailed the restructuring effort. Had the exchange continued to operate, customers could have been repaid “in full, in kind,” leaving investors with $111 billion, it added.

“Lawyers then immediately began a campaign to hold Bankman Freed accountable for the bankruptcy they had caused,” the document states. “FTX never went bankrupt, even if its lawyers forced it to go bankrupt.”

[SBF says:]

Money flowed here. pic.twitter.com/O6q77DvmTn

— SBF (@SBF_FTX) October 31, 2025

Documents say lawyers were behind SBF

Bankman Fried and his team alleged that Sullivan & Cromwell worked with FTX general counsel and former partner Lyne Miller and FTX US Derivatives CEO Zach Dexter to “take control of FTX.”

John J. Ray III, one of Sullivan & Cromwell’s attorneys, then forced FTX and Alameda into “omnibus Delaware bankruptcy,” according to the documents.

“Once FTX becomes a debtor’s property under their control, lawyers will be able to pay themselves out of FTX’s billions of dollars at their discretion,” they said.

After taking control of FTX, Sullivan & Cromwell “began prosecuting Sam Bankman Freed in the background” while he was still a client of the law firm, the document added.

FTX documents say it will make $30,000 a day if it shuts down

When Sullivan & Cromwell lawyers shut down FTX, the exchange was making $3 million a day, or $1 billion a year, according to the documents.

Amid the liquidity crisis at the time, Bankman Fried and his team said FTX also discovered transactions with $6 billion to $8 billion worth of liquidity that were “backed by hasty equity.”

Despite this, lawyers still deemed FTX a “worthless ‘dumpster fire'” and immediately shut it down, the documents said.

According to the research team, this decision accounts for “approximately $66 billion in lost value for investors in today’s market conditions.”

Bankman-Friend and his team also noted that the exchange holds $7 billion worth of FTX’s native FTT tokens, which they calculate would be worth an estimated $22 billion today.

FTT price (Source: coin market cap)

Sullivan & Cromwell sold FTX’s stake in Sui for just under $100 million, which the team said is now worth $2.9 billion. It added that FTX’s investment in Anthropic was sold for a profit of $900 million and is now worth $14.3 billion.

Outside lawyers sold stakes in Solana and Robinhood, each now worth billions of dollars, the document added.

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