FTX Founder Sam Bankman-Fried Sentenced to 25 Years in Prison

Key Takeaways:

• After months of deliberation, Judge Lewis Kaplar sentenced FTX and Alameda Research founder Sam Bankman-Fried to 25 years in prison on March 28th.
• The disgraced cryptocurrency mogul will serve 300 months after being found guilty on seven charges: two counts of fraud and five counts of conspiracy.

Who is Sam Bankman-Fried?

Sam Bankman-Fried co-founded Alameda Research and the collapsed FTX crypto exchange. He was touted as a ‘crypto king' who partied with the elites and lived in a $35 million Bahamas penthouse.

In 2022, before Sam Bankman-Fried was brought up on criminal charges, he was one of the most prominent names in the cryptocurrency space. The infamous figure attempted to lobby politicians and champion regulations by pledging millions to various parties using straw donors.

For a time, FTX was one of the most widely used exchanges in the world. The platform held billions of dollars in customer funds and enjoyed an even greater trading volume. However, ex-billionaire Bankman-Fried's life came crashing down when news of his financial indiscretions came to light.

What Was Bankman-Fried Found Guilty Of?

Bankman-Fried's charge stemmed from him taking over $8 billion from customers to prop up Alameda Research. The company had been given direct access to FTX's funds, leading to a large deficit.

Despite FTX customers missing billions, Bankman-Fried spends hundreds of millions on advertisements, political contributions, luxury property, and servicing Alameda's loans.

The former CEO's world began to crumble around him as worsening market conditions resulted in a liquidity crisis, which crushed FTX. As a result, the missing customer funds were brought to light, which got Sam Bankman-Fried sentenced.

The Sentencing

Bankman-Fried pled ignorance throughout the case. He said, “I'm sorry about that. I'm sorry about what happened at every stage.”

Before reading the sentence, Judge Lewis Kaplan condemned Bankman-Fried's actions, stating, “He knew it was wrong. He knew it was criminal. He regrets that he made a very bad bet about the likelihood of getting caught, but he's not going to admit a thing.”

Former FTX customers are still waiting to be made whole. Following the company's liquidation, customers will be paid out based on the value of any assets held. Bad actors plague the crypto space, but news of the harsh sentence will cause some to change their ways.

Related: FTX Token (FTT) Spikes 60% Following Rumors About Creditor Repayments