Three Arrows Capital accuses FTX of illegally liquidating $1.5B of its positions. FTX execs subpoenaed for court testimony in ongoing legal battle.

TLDR

• 3AC claims FTX illegally liquidated $1.5B of its positions, sparking a legal battle.
• Sam Bankman-Fried and other FTX execs are subpoenaed to testify in court.
• 3AC seeks compensation after FTX allegedly pushed it into insolvency.
• FTX’s bankruptcy estate disputes 3AC’s $1.5B claim, claiming it was $284M.

Three Arrows Capital (3AC) has filed a legal claim accusing FTX of unlawfully liquidating $1.5 billion worth of its positions during the 2022 crypto crash. The hedge fund has now summoned key FTX executives, including former CEO Sam Bankman-Fried, Caroline Ellison, and Ryan Salame, to testify in court. The case, which is part of the ongoing fallout from FTX’s collapse, aims to hold FTX accountable for its actions, which 3AC claims led to its insolvency.

According to court documents filed by 3AC, Bankman-Fried is set to provide a deposition on October 14, 2025, despite currently serving prison time. The subpoenas also target Salame and Ellison, both of whom have been sentenced for their involvement in the FTX scandal. 3AC’s legal team is pressing for answers regarding the liquidation of its assets and the role of these executives in the process.

FTX Executives Summoned for Court Testimony

In its legal filings, 3AC accuses FTX of pushing it into insolvency by liquidating its positions illegally. The hedge fund claims that the forced liquidation amounted to a massive $1.5 billion.

However, the dispute centers on the actions taken by FTX and whether they were within contractual boundaries. 3AC alleges that FTX’s decision to liquidate its assets was a breach of trust and led to substantial financial harm.

The subpoenas against Bankman-Fried, Salame, and Ellison mark a new phase in the legal battle. If the court approves the request, Bankman-Fried will testify while incarcerated, bringing new attention to the ongoing legal process surrounding FTX’s collapse. This move signals that 3AC is determined to hold FTX executives accountable for what it views as the improper liquidation of its assets.

Legal Disputes Between 3AC and FTX Estate

The legal proceedings have been complicated by contrasting claims from 3AC and the FTX bankruptcy estate. In June 2025, FTX filed a 94-page objection to 3AC’s claims, which initially stated a balance of $1.6 billion.

FTX argued that 3AC’s account only held $284 million, factoring in margin debt and losses from the market downturn in 2022. According to FTX’s lawyers, the liquidation of $82 million was necessary and within the terms of the contract.

3AC’s claim for $1.53 billion, which it first made in 2024, was based on its alleged position before FTX’s collapse. The bankruptcy estate’s response was firm, dismissing the claim as illogical. They argued that 3AC was attempting to shift responsibility for its failed trades onto FTX creditors. This discrepancy has led to a prolonged legal fight, with both sides preparing for further litigation.

Despite the ongoing legal disputes, FTX is continuing its efforts to repay creditors. The exchange announced it would initiate a new round of creditor repayments around September 30, 2025. To date, FTX has repaid approximately $6.2 billion to affected parties. However, users from 49 restricted jurisdictions are excluded from receiving payouts, limiting the scope of recovery for certain investors.

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