In another unexpected shift in the fever dream that is the collapse of FTX, Sam Bankman-Fried has begun posting on…substack? 😕

The ex-CEO and founder at the center of his firm’s collapse took to the newsletter writing platform to make his case via a post called “FTX Pre-Mortem Overview.”

While we’re sure his lawyers aren’t happy about this, the content machine that is the internet is eating it up. So here’s his recap of the situation. 📝

The central part of his message is that FTX International became effectively insolvent in November. Driving that insolvency was the following three things:

  1. Over the course of 2021, Alameda’s balance sheet grew to roughly $100b of Net Asset Value, $8b of net borrowing (leverage), and $7b of liquidity on hand.

  2. Alameda failed to sufficiently hedge its market exposure. Over the course of 2022, a series of large broad market crashes came–in stocks and in crypto–leading to a ~80% decrease in the market value of its assets.

  3. In November 2022, an extreme, quick, targeted crash precipitated by the CEO of Binance made Alameda insolvent.

He also noted that “a very substantial recovery” remains potentially available for FTX US and FTX International customers. And repeatedly claimed that he did not steal customer funds. 🤷

With that said, we must take everything said with a massive grain of salt. Only the courts can uncover the truth and attempt to make things right for those affected. In the meantime, it appears he will continue speaking publicly and telling his side of the story.

And as always, we’ll do our best to keep you up to date with all of it. Tomorrow’s Litepaper will provide more coverage on this and all of the crypto market’s happenings, so subscribe for more. 👍

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