FTX Executives Summoned to Court Over Alleged 3AC Liquidation
The of the failures of FTX and Three Arrows Capital is still unfolding, as former officials of the defunct crypto platform have been called to court. Sam Bankman-Fried, Caroline Ellison, and Ryan Salame are at the center of fresh legal actions over claims that FTX unlawfully liquidated 3AC’s multi-billion-dollar position at the height of the crypto slump in 2022.
Three Arrows Capital claims that the platform mishandled its account, which it valued at roughly $1.5 billion, and that FTX forcibly sold off its assets, which accelerated its downfall.
Influential People in the News
On October 14, 2025, Sam Bankman-Fried, the former CEO of , will be required to testify. He will be deposed while he is still in prison for fraud and conspiracy, which he was found guilty of earlier this year.Â
Caroline Ellison, the former head of Alameda Research, and Ryan Salame, the former co-CEO of FTX Digital Markets, have both been asked to provide documents and testify under oath. The three are asked to explain how the liquidation was conducted, whether internal rules were followed, and if any intentional actions were taken that harmed 3AC.
Claims of Misconduct
Zhu Su, one of the co-founders of 3AC, has been quite open about blaming FTX for the failure of his fund. The accusations claim that FTX not only caused 3AC’s account to go bankrupt, but also misused insider information. Ryan Salame is accused of using his access to customer data to trade against users and make about $1 billion in profit.
These revelations make the already large number of accusations against the bankrupt platform even more controversial. If proven, they might reveal that management intentionally profited while other companies in the market were going out of business.
FTX’s Answer
The FTX estate, currently managed by bankruptcy administrators, disputes 3AC’s account of the events that occurred. The hedge fund’s claims were much higher than they should have been, according to company documents. The account didn’t actually have $1.5 billion; it was worth closer to $284 million later than debts were paid.
FTX also states that only $ 82 million was sold, and that this was done to mitigate the risk of . The estate claims that 3AC incurred significant losses due to market conditions and its own withdrawals, rather than FTX’s actions.
What Comes Next?
The that is emerging could be crucial in determining who is responsible. If the court concludes that FTX executives deliberately participated in wrongful liquidation or insider trading, it may lead to more legal and financial hardys for the individuals involved.
The litigation is an attempt by 3AC to recover its losses and hold individuals accountable for its failure. The result may assist the determine how platforms should handle prominent customer positions when the market is highly volatile.
In October 2025, will testify under oath. The industry will be looking intently to view if the testimony reveals more wrongdoing or merely confirms that 3AC lost money due to market turbulence.
