One of the biggest fraud cases in crypto history came to a temporary end this Thursday. Sam Bankman-Fried, the founder of the insolvent crypto exchange FTX, has to go to prison. It ended up being 25 years. He protested his innocence until the end, but the evidence was too strong and his defense strategy was too weak. In the end you have to say: SBF gambled away. A comment.
The trial was a spectacle. A textbook drama that should soon find its way onto the screens of domestic streaming services. (Amazon has apparently already secured the rights to the story.) It had everything a good legal thriller should have: shocking revelations, heated discussions, abrupt turns, emotional outbursts – and at the end a convicted billionaire fraudster: Sam Bankman-Fried .
But it was also an unmasking. The disenchantment of a “crypto prodigy”, a “trading genius” who ended up making all too human mistakes – driven by arrogance and hubris. Overall, they ensured that the chances of a more lenient sentence continued to shrink.
This started shortly after FTX’s demise, when SBF thought it would be a good idea to make public statements about the collapse of its crypto empire. Fully aware that the long arm of US law could strangle him with these statements at some point. “I messed it up. I was the CEO, so it was my responsibility too,” Sam Bankman-Fried said in one Interview with the New York Times almost a month after the collapse. In the courtroom, gaps in memory suddenly became apparent. During his interrogation, the former multi-billionaire reeled off various variations of “I can’t remember” or “I don’t remember” more than 140 times. The FTX founder also no longer wanted to know about his responsibilities. Instead, he shifted the blame onto his accomplices.
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The fact that SBF took the witness stand at all was one nail in the coffin among many. Hardly any lawyer would have advised him to take this risky step. Only he can answer why he did it anyway. Maybe it’s because of SBF’s character. He is known for not shying away from high risks. This quality landed him a job at Jane Street, one of the largest trading firms on Wall Street. But the courtroom is not a trading desk. The laws of the highly frequented financial market do not apply there, only evidence, credibility and ultimately the sympathy of the jury – SBF could hardly really show anything.
During the trial he often appeared arrogant and unteachable. One situation in particular stands out when he answered a question from the prosecution on the witness stand, even though an objection from his defense attorney had previously been upheld. “I felt like I had to answer the question,” said SBF, almost defiantly.
In general, it has to be said that SBF’s lawyers often appeared pale. They were hardly able to land any effective hits in court, especially in the cross-examination of the key witnesses around Caroline Ellison, Nishad Singh and Gary Wang. The deal that former FTX and Alameda executives made with the US authorities was supposed to be one of the main pillars of the strategy. Instead, this point only rarely came up in the interrogations.
The fate of Sam Bankman-Fried has been decided. The FTX founder is guilty. A long prison sentence awaits him. It ended up being 25 years. In view of the possible 115, the sentence seems almost lenient. Until the end, the former “crypto prodigy” had defended himself against the numerous accusations of fraud, conspiracy and money laundering – in vain. In the end you have to say: SBF gambled away. This time, however, the stake was not his customers’ money, but his freedom.
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