And just like that, Sam Bankman-Fried has been handed a 25-year sentence behind bars, marking the climactic end to a saga revolving around the punishment of the so-called ‘Crypto King’. Bankman-Fried, the mastermind behind the theft of billions of dollars from customers of his cryptocurrency exchange FTX, is left standing as a central figure of one of the largest financial frauds in US history.
With such illustrious criminal activity, the severity of Bankman-Fried’s sentence comes as little surprise. Judge Lewis Kaplan, presiding over the case, branded him a calculated offender who knowingly engaged in fraudulent activities, gambling on not being apprehended, as reported by the BBC.
“There are a lot of mistakes that I made,” Bankman-Fried told the court, acknowledging his transgressions, though to say he has appeared remorseful over the entity of events leading up to this point wouldn’t be the truth. Speaking of past events, with the gavel finally falling on his fate, now is an opportune moment to revisit this tumultuous narrative and reflect on how this American entrepreneur descended into orchestrating one of the most infamous financial frauds in history.
Sam Bankman-Fried: A Timeline of Events
The name Sam Bankman-Fried was not always synonymous with financial fraud. In the beginning, SBF was simply a budding entrepreneur, establishing another firm, Alameda Research, in 2017 shortly after graduating from MIT.
Transitioning into the realm of cryptocurrency later on, SBF projected an image of philanthropy, committing to donate the bulk of his riches and actively engaging in aiding the US government’s endeavours to regulate crypto. The pivotal change in this narrative was kickstarted with the founding of FTX. Let’s dive in.
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April 2019 – Bankman-Fried Founded the FTX Cryptocurrency
Short for ‘Futures Exchange’, FTX was co-founded by SBF in 2019 with former Google employee Gary Wang. FTX was a cryptocurrency exchange specialising in crypto tokens and derivatives.
October 2021 – FTX Becomes Second Largest Crypto Exchange
After a couple of very successful years, FTX’s success soared. By October 2021, FTX has raised $420 million in venture funding, valuing the company at $25 billion and leading SBF to debut on the Forbes billionaires list, according to Reuters.
June 2022 – All Hail The “Crypto King”
By summer 2022, both the success of FTX and of SBF are soaring thanks to the current popularity boom for crypto, having recently been advertised at the NFL Super Bowl and the collapse in the prices of Bitcoin and other digital assets. SBF is now firmly the “Crypto King”
November 2022 – Leaked Alameda Research Report
Following its success over the summer, things quickly turned sour as digital publication CoinDesk published a leaked Alameda Research balance sheet showcasing that much of its $14.6 billion in assets are held in FTX’s own token, FTT. This leads to the token shedding a whopping $400 million of its market cap and rival exchange Binance takes the opportunity to publicly renounce its FTT holdings.
November 2022 – FTX Files For US Bankruptcy
After the leaked report, a swath of customers withdraw from FTX, leading to FTX filing for US bankruptcy and SBF resigning as the firm’s chief executive officer.
December 2022 – Bankman-Fried Is Arrested
In a quick spiral down of events, SBF is arrested at home in the Bahamas on fraud and conspiracy charges.
December 2022 – Appearances In Court
Following FTX co-founder Wang and Alameda chief executive Caroline Ellison already pleading guilty, SBF himself is taken into a Manhattan federal court, though he is released to his parent’s home.
January 2023 – Bankman-Fried Pleads Not Guilty
Despite Wang and Ellison pleading guilty, SBF takes stands firm against his charges, pleading not guilty before US District Judge Lewis Kaplan and denying stealing funds, instead blaming the broader downturn in crypto for FTX’s collapse.
October 2023 – The Trial Begins
Following a period of bail, Kaplan revokes this after SBF is accused of tampering with witness evidence, leading to SBF to, once again, face trial in Manhattan in October. Despite admitting the severe consequences of FTX’s collapse on its customers, SBF maintains his innocence of stealing their money.
November 2023 – Bankman-Fried Faces Conviction
Despite holding onto his innocent plea, SBF is convicted of all charges levied against him.
March 2024 – Bankman-Fried Sentenced To 25 Years
On March 28th, Kaplan finally sentenced Bankman-Fried to 25 years in prison, ending a long and dramatic series of events and marking the final fall from grace of the previously named “Crypto King”.
