SBF Says Handing Over FTX Was His Biggest Mistake Before Collapse

Key Insights:

Sam Bankman-fried says his biggest regret was handing FTX over before he could secure rescue funds.

FTX collapsed in Nov. 2022 due to misuse of user funds by Alameda.

Creditors have received $7.8B in repayments; $8.7B more expected.

Sam Bankman-Fried, the jailed founder of collapsed crypto exchange FTX, have commented on his biggest mistake before his arrest. According to him, his “single biggest mistake” was handing the company over to new leadership. 

In a new interview with Mother Jones, SBF revealed he had been approached about a potential last-minute investment just minutes after signing away control of the exchange in November 2022 but by then, it was too late.

The firm’s new CEO, John J. Ray III, immediately filed for bankruptcy and brought in legal counsel from Sullivan & Cromwell to begin restructuring.

FTX’s collapse, which resulted in an $8.9 billion hole in customer funds, stemmed from Bankman-Fried's mismanagement and unauthorized transfer of assets to sister trading firm Alameda Research. He was convicted on seven felony charges and is now serving a 25-year sentence. 

Creditors See Progress in Repayments, $8.7B Still Expected

Ahead of SBF’s appeal hearing this month on November 4, FTX has so far repaid a total of $7.8 billion to creditors across three repayment rounds, including a $1.6 billion payout on September 30. 

The estate, now managed by Ray and a court-appointed team, aims to repay at least 98% of customers 118% of their original balances as recorded in November 2022.

The exchange is estimated to have recovered up to $16.5 billion in assets, leaving around $8.7 billion still to be returned. Many creditors are hopeful, but the complex bankruptcy case continues to unfold nearly three years after the initial collapse.