The Biggest Crypto Loser of The Century: Sam Bankman-Fried Found Guilty On All 7 Charges
The saga of FTX crypto empire has come to its logical ending. The climax of the story, with Sam Bankman-Fried as the main character and villain, came on Thursday. It took the court a month to sort out the intricacies of the case. It took the jury four hours to reach a guilty verdict.
The plot opening
In early October, Sam Bankman-Fried went on trial. He is charged with seven counts of fraud, conspiracy, and money laundering. His FTX empire was once a thriving oasis in the crypto space, but it turned out to be a Trojan horse. During the company's brief but bright existence, its founder managed to embezzle $8 billion in client funds, settle in the Bahamas and gain the support of politicians and celebrities.
Federal prosecutors accused Bankman-Fried of using FTX as his personal piggy bank and called his crimes as old as the world, as classic fraud lurked beneath the "crypto" shell. Except that its scale was surprising until the very last word at the court hearing.
A turning point or a story about partners in crime being snitches
The first week of trials got off to a dull start: while jury selection was going on in the courthouse, the media, and crypto influencers were placing their bets on what to expect, trying to stir up the public's spirits. A documentary and a couple of books were released about the rise and fall of Sam Bankman-Fried. But everyone expected the most interesting part, which is the questioning of witnesses and former colleagues (ahem, ahem, partners in crime) of the disgraced businessman.
Since the collapse of FTX in 2022, Bankman-Fried has built an aura around himself as a well-meaning nerd who was himself a victim and emerged from the wreckage of FTX, shaking the dust off his angel wings. And standing in front of a jury, he spent two whole days proving his innocence and non-involvement, accusing his coworkers of deception. But, one by one, yesterday's friends pieced together the facts of his guilt.
Caroline Ellison, Gary Wang and Nishad Singh have all declared Bankman-Fried guilty...except Sam himself, of course. In the most candid detail, they recounted the how, when, and where, stripping their boss of the shell of virtue he had put on. Wang called himself the developer of the very "backdoor" in the code that allowed hedge fund Alameda Research to siphon off FTX clients' money and put it under Bankman-Fried's control. Wang explicitly stated that he was acting at the behest of Bankman-Fried.
Everyone waited to see what Allison would say, since she was Sam's ex-girlfriend and the CEO of Alameda. There was no one more qualified to shed light on Sam's actions. She presented enough facts to shock those present in and out of court. Two minutes into her questioning, she blandly answered positively when asked by prosecutors if they (Sam & Co.) had committed crimes. She also stated that the decision to use FTX customer funds for personal use was dictated by Bankman-Fried. Allison confirmed that Sam was more concerned with his sloppy appearance, which is necessary to maintain the company's special image. And this represented another way of defrauding customers.
In this story, the partners in crime turned out to be snitches.
The climax
Last Thursday, Sam Bankman-Fried faced the jury for the last time. They heard Sam's "I don't recall" about 140 times as he answered on cross-examination. Still, that didn't prevent a verdict. Four hours later, the jury returned with its final decision, "Guilty on all seven charges." And they even had time for dinner. Meanwhile, Sam showed no emotion as he listened to his verdict.
The trial showed how brazenly and recklessly the crypto empire operated under the leadership of Bankman-Fried. Judge Kaplan still has time until March 28, 2024, to consider what sentence to give the defendant (which might be up to 110 years). Of course, Sam, and his legal team will have time to file more than one appeal before then, but that's another story to tell, as are the revealing details about his parents' brazenness during Sam's reign at FTX.
STATEMENT FROM THE TEAM OF SAM BANKMAN-FRIED —
— Teddy Schleifer (@teddyschleifer) November 3, 2023
“We respect the jury’s decision. But we are very disappointed with the result. Mr. Bankman Fried maintains his innocence and will continue to vigorously fight the charges against him." pic.twitter.com/Q69w6nKB34
Speaking of family ties, Joseph Bankman and Barbara Fried also attended most of their son's trials and supported each other, hugging each other at sentencing. Ironically, Sam's parents, professors of legal ethics, do not seem to have taught their son the most important moral quality: do not steal.
Joseph Bankman and Barbara Fried were present for the reading of the verdict.
— David Z. Morris (@davidzmorris) November 3, 2023
Joe folded forward in his seat. Barbara put her fingers in her ears as if wishing not to hear.#ftxtrial https://t.co/ymTnc76Lra
Epilogue
The FTX epic has come to an end, but the public has something to say. Immediately after the verdict, Twitter was flooded with thousands of opinions from those who cared. From warnings to the entire crypto community to memes.
Sam Bankman Sam Bankman
— WOLF OF LUKSO 🆙️ (@CRYPTO_WOLF_OF) November 2, 2023
Fried Jailed pic.twitter.com/h8YR8N3VUQ
Crypto analyst and venture capitalist Adam Cochran stated, "Should let the SBF trial be a clear warning for other operators in crypto."
In one of Michael Lewis' books, we learn that Sam dislikes Shakespeare's stories, calling them predictable. However, he did not notice himself getting caught up in a story with an obvious ending. It seems that "The Wolf of Wall Street" is facing a sequel, however, Sam will be watching it while in prison.
