Nearly three years after the spectacular collapse of FTX, its founder Sam Bankman-Fried is once again defending his version of events, this time from his prison cell.
Sam Bankman-Fried Reemerges in Prison Interview, Claiming FTX Was Never Insolvent
17 October 2025 - 09:03 CEST
In a newly published interview conducted through intermediaries and released by the conservative X account @amuse, the disgraced crypto executive insists the exchange that he founded was solvent when it fell and that his downfall stemmed from panic, poor legal advice, and regulatory hostility rather than fraud.
What went wrong
The fall of FTX, and Bankman-Fried’s indictment, remains one of the largest financial scandals in crypto history. Once valued at $32bn and considered a model of institutional crypto finance, FTX imploded in November 2022 after revelations that customer deposits were being diverted to Alameda Research, a trading firm Bankman-Fried also controlled.
The disclosures sparked a run on the exchange and an $8bn deficit in customer funds. FTX filed for bankruptcy days later, triggering a media storm and investigations that uncovered a tangle of risky loans, hidden liabilities, and personal spending from company accounts.
Bankman-Fried was arrested, and in 2024 a US federal jury convicted him on seven counts of fraud and conspiracy. He was sentenced to 25 years in prison. Prosecutors argued he stole from customers and lied to investors, using their deposits to backstop Alameda’s trading losses, buy real estate, and make political donations.
Internal records and testimony from senior FTX staffers showed deliberate commingling of funds and falsified balance sheets. Judge Lewis Kaplan, who presided over the case, called the collapse of FTX “one of the largest financial frauds in US history.”
History Revisited
The account publishing the interview, @amuse, is run by conservative commentator Alexander Muse, known for politically charged reporting. His Substack and X threads often feature anonymous sourcing and commentary critical of the Biden administration and the US Securities and Exchange Commission. In this exchange, Muse portrays Bankman-Fried as a victim of overzealous regulators and opportunistic bankruptcy lawyers.
Muse’s write-up, titled Where Did the Money Go, paints the FTX founder as a casualty of bureaucratic overreach and legal opportunism. “The official story of FTX’s collapse may be one of the greatest miscarriages of financial truth in recent memory,” Muse writes.
The piece argues, based on a series of exchanges with Bankman-Fried, that executives at firms such as Lehman Brothers and AIG, whose own multi-billion-dollar collapses harmed investors, faced no criminal charges. Meanwhile, Bankman-Fried has been cast as a political scapegoat in an era of public mistrust toward crypto.
Pleading his case
“FTX was never insolvent,” Bankman-Fried says, arguing that the exchange held $15bn in assets against $8.4bn in liabilities when it filed for bankruptcy. He blames lawyers and regulators for panicking and liquidating assets “at fire-sale prices,” asserting “they made promises they immediately reneged on.”
In the interview, Bankman-Fried blames three forces for FTX’s collapse: regulatory overreach, legal mismanagement, and internal distraction.
He says the company’s developers “spent half their time jumping through hoops for regulators,” instead of building safeguards. He claims that as market conditions worsened, he relied on legal advisors who pushed him into surrendering control. “Their pressure was massive,” he said. “They told me that handing over the company would protect customers. It didn’t. It helped the lawyers.”
Where to next
Still, Bankman-Fried’s defense clashes directly with court findings and witness testimony from former FTX executives, who described deliberate deception about the exchange’s financial health. Even if the bankruptcy estate ultimately repays all creditors, prosecutors maintain that those repayments do not erase the original fraud.
For his part, Bankman-Fried now portrays himself as reflective but defiant. “When almost no one is sticking up for you,” he wrote, “you have to stick up for yourself, to the extent that it’s deserved.”
Whether that view gains traction may depend on how much the public still wants to believe in the myth of the fallen genius who outsmarted and was destroyed by the industry he once tried to pioneer.
