Sam Bankman-Fried to “HODL” in Prison for the Next 25 Years

The author does not provide investment advice and has no stake in any of the mentioned stocks.

Today’s sentencing of Sam Bankman-Fried (SBF) for orchestrating the largest financial fraud in the US since Bernie Madoff’s Ponzi scheme, resulting in the victimization of numerous customers of the now-defunct crypto exchange FTX, can be accurately described as a form of retribution, justice, and restitution.

For the benefit of those who may not be aware, it was discovered that Sam Bankman-Fried, the former CEO of FTX, had been using questionable tactics to benefit his personal trading arm, Alameda Research. Essentially, FTX would repeatedly transfer its native FTT tokens to Alameda at very low prices, while simultaneously inflating the value of FTT through burning a portion of the token’s circulating supply using revenues from the exchange. Alameda would then use these FTT tokens as collateral to borrow funds from FTX’s clients, which were used for leveraged bets. However, once Alameda’s excessive exposure to FTT became public knowledge, Binance began selling off their own FTT tokens, causing the token’s value to

Figured I’d dust off some lesser known facts about SBF given today is his sentencing 🧵

1. In January ’22, Sam market sold $75M of stETH, leading to a massive depeg event which set off the Celsius bankrun and the daisy chain of events that included the blow-up of 3AC pic.twitter.com/BGHem10yhz

— Conor (@jconorgrogan) March 28, 2024

The aforementioned thread provides a thorough account of SBF’s manipulative actions. Following the downfall of FTX, Sam Bankman-Fried initially fled to the Bahamas, but was later extradited back to the US to answer for multiple charges involving wire and securities fraud.

Sam Bankman-Fried Receives 25-Year Prison Sentence

CORRECTED-FTX FOUNDER SAM BANKMAN-FRIED SENTENCED IN NEW YORK TO 25 YEARS (NOT 20) IN PRISON FOR MULTI-BILLION DOLLAR FRAUD

— *Walter Bloomberg (@DeItaone) March 28, 2024

At the heart of the issue is the fact that Sam Bankman-Fried has been sentenced to 25 years in prison. Additionally, the presiding judge has mandated that the former FTX CEO must forfeit more than $11 billion. Adding insult to injury, the judge’s comments only add to the severity of the situation.

“When not lying, he was evasive, hair splitting, trying to get the prosecutors to rephrase questions for him. I’ve been doing this job for close for 30 years. I’ve never seen a performance like that.”

Despite being on trial, Sam Bankman-Fried consistently asserted his innocence, pointing to “sophisticated analytics”and the incompetence of the junior staff as the reason for the loss of track of Alameda’s FTT-based leverage.

SBF going to HODL in jail for 25 years

— Thomas Thornton (@TommyThornton) March 28, 2024

It is important to mention that, thanks to the current bullish trend in the wider cryptocurrency market, all FTX creditors have been fully compensated by the estate of the now-defunct exchange. This is due to the successful recovery of many crypto assets that were previously thought to be lost forever. As a result, Sam Bankman-Fried received a significantly shorter sentence compared to Bernie Madoff, who was sentenced to 150 years in prison.