Three Arrows Capital has recently sought court action to compel former FTX executives to provide testimony and documents regarding the alleged liquidation of 3AC’s $1.5 billion holdings, one of the largest cases in exchange bankruptcy history.
A court filing titled “Notice of Intent to Serve Subpoena on Sam Bankman-Fried” requests that former FTX CEO Sam Bankman-Fried, who is currently incarcerated in California, appear for a deposition on October 14, 2025.
If the subpoena is approved, Bankman-Fried would be transported from prison to a courtroom to testify under oath about FTX’s dealings with Three Arrows Capital prior to its collapse.
In a court filing shared by FTX creditor Sunil Kavuri, the subpoena not only targets Sam Bankman-Fried but also his former associates who have served prison sentences for their roles in the scandal that defrauded customers of billions.
The document names former Alameda Research CEO Caroline Ellison and former co-CEO of FTX Digital Markets Ryan Salame.
According to Kavuri, 3AC co-founder Zhu Su accused Bankman-Fried of illegally force-liquidating $1.5 billion of 3AC’s positions during the 2022 crypto crash. If true, this would suggest that FTX contributed to pushing 3AC toward insolvency. Zhu Su also accused Salame of using insider information, including knowledge of client orders and positions, to trade against them, allegedly profiting around $1 billion.
FTX’s connection to 3AC
In June 2025, FTX’s bankruptcy estate formally denied claims from Three Arrows Capital. The hedge fund asserted that its account balance had reached nearly $1.6 billion when FTX collapsed in mid-to-late 2022, but FTX representatives said the net value was only about $284 million after accounting for $733 million in margin debt.
In a 94-page objection, FTX lawyers urged the court to reject 3AC’s claim entirely, calling it “illogical and baseless.”
“FTX creditors should not be a backstop for 3AC’s failed trades,” the estate argued. The filing noted that 3AC refused to acknowledge its liabilities and attempted to shift losses from its heavily leveraged positions onto other creditors.
The objection explained that most of the $284 million dissipated over two days in June 2022 during a crypto market crash. Of that amount, $222 million was lost due to market declines, while $60 million was withdrawn by 3AC itself. FTX stated it only liquidated $82 million, as permitted under contract terms, which helped prevent the account from going negative.
While 3AC initially claimed to hold $120 million in its account, it later expanded its claim to $1.53 billion in November 2024.
