SBF says Sullivan & Cromwell contradicted itself with insolvency claims

Law steadfast Sullivan & Cromwell person contradicted themselves erstwhile they assertion that shuttered crypto speech FTX.US is insolvent, according to erstwhile CEO Sam Bankman-Fried (also known arsenic “SBF”) successful a January 17 blog station that was shared connected Twitter.

FTX US is solvent, arsenic it ever arsenic been.https://t.co/XjcyYFsoU0 pic.twitter.com/kn9Wm9wxjl

— SBF (@SBF_FTX) January 18, 2023

The instrumentality steadfast was hired by FTX Group to grip the bankruptcy proceedings of respective of its subsidiaries, including FTX International, Alameda Research, and FTX.US. However, Sam Bankman-Fried has stated connected respective occasions that he believes FTX.US is solvent and should not person declared bankruptcy.

In a connection filed with the United States Bankruptcy Court for the District of Delaware connected January 17, Sullivan and Cromwell reiterated its assertion that FTX.US is not solvent, stating: “The assets identified arsenic of the Petition Date are substantially little than the aggregate third-party lawsuit balances suggested by the physics ledger for FTX US.”

In his post, SBF denied this assertion and stated that the instrumentality steadfast has contradicted itself:

“Later successful the aforesaid report, S&C reveals that FTX US has an further $428m USD successful slope accounts, connected apical of the $181m of tokens—for astir $609m of full assets[…]thus FTX US had astatine slightest $111m, and apt astir $400m, of excess currency connected apical of what was required to lucifer lawsuit balances.”

The erstwhile CEO concluded from this that, “FTX US is solvent. Customers should beryllium fixed entree to their funds.”

SBF resigned arsenic CEO of crypto speech FTX connected November 11, 2022, and John J. Ray III was appointed arsenic the company’s replacement CEO. On December 13, SBF was charged with fraud by the U.S. Securities and Exchange Commission successful transportation with FTX’s bankruptcy. The SEC alleged that he, “orchestrated a years-long fraud to conceal from FTX’s investors[…]the undisclosed diversion of FTX customers’ funds to Alameda Research LLC, his privately-held crypto hedge fund.” He has pled not guilty and is presently awaiting trial.

After being released connected bail, SBF began publishing blog posts connected substack opening connected Jan. 12, but galore successful the crypto assemblage person been unimpressed with his writings.