Sam Bankman-Fried was considered a crypto prodigy. Just a few months ago, the FTX founder graced the front pages of US business journals such as “Fortune”.
FTX founder Sam Bankman-Fried, accused of fraud, money laundering and other crimes, has pleaded not guilty as expected. At a hearing in New York, judge Lewis Kaplan scheduled the trial to begin on October 2, 2023, according to US media.
The public prosecutor’s office accuses Bankman-Fried, among other things, of misleading investors in his crypto empire, which collapsed about two months ago, and of embezzling customer funds on a large scale. The 30-year-old admits mistakes, but rejects intentions to cheat. He faces up to 115 years in prison if convicted on all eight counts.
$250 million bail
Bankman-Fried was arrested on December 12 at the behest of US law enforcement in the Bahamas, where FTX – one of the largest exchanges for cryptocurrencies like Bitcoin before the collapse – was headquartered. Other former FTX top executives have pleaded guilty and heavily charged the group’s founder. After his extradition to the United States, Bankman-Fried was released on $250 million bail.
However, in US proceedings, only a fraction of the bail amount usually has to be deposited. Bankman-Fried said in November that he only had around $100,000 left. According to US media, the house of his parents, two professors at the US elite university Stanford, was brought in as security for the bail application.
Bankman Fried’s FTX group collapsed within a few days in October due to enormous withdrawals of funds in the wake of liquidity concerns. Billions in customer funds could not be paid out. Bankman-Fried, just called SBF in the crypto industry, resigned on November 11 and filed for bankruptcy for the group in the US state of Delaware. Shortly before, authorities in the Bahamas had already frozen company funds. There are also civil lawsuits and class action lawsuits against the FTX founder in the United States.
It is a spectacular crash: Just a few months ago, the young entrepreneur graced the front pages of US business journals as a crypto prodigy. Before the FTX bankruptcy, Forbes and Bloomberg once put his fortune at over $26 billion.
