Worse Than Enron: SBF’s FTX Has ‘Complete Absence of Trustworthy Information’

When your new CEO says your financials are this bad, perhaps it’s time for a career that doesn’t involve numbers.


Blockworks Exclusive art by axel rangel


The new CEO of failed crypto exchange FTX has some harsh words for his predecessor, Sam Bankman-Fried.

John J Ray III, who previously oversaw restructuring efforts at historic corporate failures such as Enron, explained in a declaration supporting the FTX bankruptcy proceedings that:

“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.”

And while he wasn’t impressed with SBF and his tight-knit team of insiders, he had precious little to celebrate at any level — including failed regulatory systems in his initial assessment of the situation at FTX:

“From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.”

Following what appeared to be a hack shortly after the bankruptcy was filed, Ray noted that “the implementation of accounting, audit, cash management, cybersecurity, human resources, risk management, data protection and other systems that did not exist, or did not exist to an appropriate degree, prior to my appointment” was a priority.

The absence of appropriate cybersecurity measures will be galling to those who lost money in the collapse of FTX.

One of the more startling details of the bankruptcy proceedings so far is FTX now declaring the value of its remaining assets at a mere $659,000.

Former CEO Bankman-Fried had previously valued its assets at $5.5 billion.

Bankman-Fried has issued a series of erratic tweets in the days since his crypto empire fell apart, prompting the official FTX Twitter account to note, tersely, that 

“As previously announced, Mr. Bankman-Fried resigned on November 11 from @FTX_Official, FTX US, Alameda Research Ltd. and their directly and indirectly owned subsidiaries.

Mr. Bankman-Fried has no ongoing role at @FTX_Official, FTX US, or Alameda Research Ltd. and does not speak on their behalf.”

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research



Akash is a general-purpose compute platform with GPUs, storage, LLM training or inference, and validator hosting through its two-sided marketplace.


Public mining companies have committed about $750 million to buy machines in the last couple months, BlocksBridge Consulting data shows



Whether real estate, diamonds or energy, crypto has an abundance of opportunities ahead of it through RWA tokenization


Block’s self-custody bitcoin wallet uses three keys to secure bitcoin


Montenegro plans to extradite Do Kwon to the US over South Korea, the Wall Street Journal reports


In the rare cases when fraud is punished — like the Sam Bankman-Fried trial — we should feel no guilt for doing so to the full extent


A new Reuters report claims that applicants and the SEC continue to work out spot bitcoin ETF details