Sam Bankman-Fried requests new trial claiming FTX had $16.5 billion surplus in 2022, but does it matter?

Sam Bankman-Fried filed a motion for a new trial, asserting that FTX possessed a $16.5 billion net asset value (NAV) at the time of its November 2022 bankruptcy petition, reframing the collapse as a liquidity crisis rather than fraud-driven insolvency. The core of his argument suggests that if customers are repaid (with distributions potentially exceeding 118% of their 2022 account values), the trial's narrative of irrecoverable losses is misleading. However, the article contends that repayment does not erase fraud because crypto exchange solvency involves three dimensions: accounting solvency (NAV), liquidity solvency (meeting on-demand withdrawals), and governance solvency (segregation and conflict controls). Bankruptcy law calculates customer claims based on petition-date dollar values, excluding subsequent crypto appreciation, meaning customers paid "in full" under this doctrine may not receive their specific assets back. The article concludes that while the $16.5B NAV claim shifts the narrative toward a liquidity mismatch, it does not negate the fraud established by misrepresentation, commingling of funds, and governance failures that occurred prior to the collapse.

(Source：CryptoSlate)