Author: @amuse Compiled by: AididiaoJP, Foresight News
SBF's story doesn't end in the courtroom where he was sentenced. It continues in spreadsheets, balance sheets, and forgotten ledgers.
These documents tell a very different story from the one the public hears.
Through the prison's slow, monitored email system, and through friends, I corresponded with SBF. In his letters, he appeared calm, analytical, and reflective. He read voraciously in science fiction, immersed in fictional worlds, perhaps because in the real world, the company he founded was dismantled by lawyers who understood neither cryptocurrency nor the fundamentals of business. He had lost weight and become quieter. What he has to say now is worth listening to, because the official narrative surrounding FTX's collapse may be one of the most egregious distortions of financial truth in recent memory. According to data provided by SBF, FTX was never insolvent, not when he handed over control under legal and regulatory pressure in November 2022, nor when the market bottomed out. By his calculations, at the time of the bankruptcy filing, FTX had $15 billion in assets and only $8.4 billion in liabilities. He argues that this massive difference should have served as a safety net to protect customers and creditors. Yet bankruptcy lawyers declared the company "irretrievably bankrupt" and sold off its assets at fire-sale prices. Today, every creditor has been repaid in full or even received additional benefits, but billions of dollars that could have been recovered were wasted on exorbitant attorney fees, legal battles, and decisions made by people who had “no idea what they were doing.”
The mainstream narrative portrays FTX as a house of cards, a madcap enterprise run by a founder who behaved erratically, commingled funds, and defrauded investors. But the deeper truth is much more complicated.
FTX's operating model is similar to that of many fast-growing technology startups: rapid iteration and rapid trial and error in areas where the law is still underdeveloped. SBF now admits that the irony is that the company's real weakness was not fraud but compliance. They spent too much energy satisfying regulators who only knew how to punish but not guide.
This involves an ethical distinction that is rarely discussed publicly. SBF emphasizes that taking responsibility is not the same as admitting guilt. Responsibility means choosing to be the leader of events rather than the passive one, and facing up to one's role in their formation. In this spirit, he does not deny his errors of judgment. He deeply regrets: giving up control when leadership was most needed; failing to effectively monitor Alameda's risk exposure; and focusing too much on regulatory games while neglecting operational management. But he also refuses to accept the reputation of being a "villain who stole billions of dollars." He believes that his real failure lies in leadership, not theft.
The contrast couldn't be starker: Had FTX been left to recover naturally, it could have become one of the most remarkable comeback stories in financial history. Instead, it became a bonanza for professional services firms, which were handsomely compensated for handling its "failure." The lawyers' hasty disposal of assets at the market's trough prevented them from capitalizing on the subsequent cryptocurrency rebound, which could have multiplied the value of their assets. Sam estimates that the bankruptcy estate could have generated an additional $125 billion in value with better management. Instead, they sold at the bottom, gloating about their existing solvency and paying their own hefty bills with funds provided by the very stakeholders they were supposed to protect.
Estonian nationals Sergei Potapenko and Ivan Turogin have agreed to surrender all claims to digital assets seized by US authorities as part of their plea agreement. To date, $350 million has already been returned to victims.
Kikyo