Sam Bankman-Fried, the disgraced cryptocurrency mogul who perpetrated one of the largest financial frauds in history, has been sentenced to 25 years in prison and ordered to forfeit $11bn in assets. His lawyer reiterated a pledge to appeal the sentence the same day.
The judge, Lewis Kaplan, issued the penalty in a Manhattan courtroom on Thursday. Bankman-Fried, the former chief executive of the now-bankrupt cryptocurrency exchange FTX, was convicted of fraud and conspiracy to launder money late last year.
Bankman-Fried appeared in courtroom at around 9.40am, taking his seat in khaki prison garb with his hair grown back out to the messy style he was known for as crypto billionaire. He gave little reaction as Kaplan read out his sentence.
During the sentencing, Kaplan described Bankman-Fried as a calculating math genius who sought power and influence while knowingly committing wrongdoing. Although Bankman-Fried apologized for the fall of FTX, saying he “made a series of bad decisions”, Kaplan stated that there was “never a word of remorse” for his crimes.
“He knew it was wrong, he knew it was criminal,” Kaplan said.
The hearing began with Kaplan rejecting several of the defense’s arguments about sentencing guidelines, as well as stating that Bankman-Fried committed perjury numerous times during his testimony in the trial. Kaplan likened the defense’s claim that customers could be paid back to a situation where a thief takes his plunder to Las Vegas, then appeals for leniency if he can return with the winnings.
Before Kaplan read out his decision, Bankman-Fried, his defense attorney and the federal prosecutor all gave statements.
Bankman-Fried delivered a meandering apology of sorts, blaming the crisis at FTX on mismanagement and saying that he was “sorry about what happened”. He praised his former employees and executives, including co-founder Gary Wang and his former girlfriend Caroline Ellison – both of whom testified against him in the trial. Bankman-Fried claimed that he wished he could help return customers funds, but acknowledged he was no longer in a position of power.
“My useful life is probably over,” Bankman-Fried said.
Marc Mukasey, the defense attorney for Bankman-Fried, attempted to paint the former crypto mogul as a sensitive and good-hearted person who made mistakes. He described Bankman-Fried as “an awkward math nerd” who loved animals, video games and “lives to give to others”. Mukasey also cited Bankman-Fried’s social awkwardness and depression as reasons he is misunderstood, likening him to “a beautiful puzzle”.
“Sam Bankman-Fried doesn’t make decisions with malice in his heart. He makes decisions with math in his head,” Mukasey said.
Neither appeal seemed to hold sway with Kaplan, who stated that while he took into account that Bankman-Fried has autism and is socially awkward, he had committed a very serious crime. Kaplan described Bankman-Fried as coming from “an exceptionally privileged background”, referencing his law professor parents who were in the courtroom watching, and used his intellect to calculate the probability he could get away with his crimes.
Kaplan singled out Bankman-Fried’s testimony during his criminal trial as evidence that the former billionaire had no intent to take responsibility for his crimes, saying that he was “evasive” and “hair-splitting” while lying about his conduct.
“Never seen a performance quite like that,” Kaplan said, adding that he saw a risk that Bankman-Fried would commit more wrongdoing in future if he was able.
Prosecutors had sought a sentence of between 40 to 50 years, arguing that Bankman-Fried, 32, showed a lack of remorse for his crimes while leading a life of “unmatched greed and hubris”. In a statement after the sentencing, federal prosecutor Damian Williams said Bankman-Fried’s sentence sent “an important message” and would “prevent the defendant from ever again committing fraud”.
In pre-sentencing arguments filed last month, Bankman-Fried’s lawyer urged the judge to show leniency, and said the maximum potential sentence for his client of 100 years was “grotesque”. Bankman-Fried’s attorneys were seeking a sentence of about seven years in jail.
Kaplan recommended that Bankman-Fried be sent to a medium- or low-security prison facility in the Bay Area, to allow for family visitations.
Bankman-Fried’s fall from crypto mogul to pariah
Only two years ago, Bankman-Fried was poised to become one of the most financially and politically influential people in the US. His firm FTX was valued at $32bn, and he had become the public face of the cryptocurrency industry, appearing on stage at events with celebrities and former world leaders and testifying before the US Congress. He was a major political donor, pouring money into election campaigns while lobbying lawmakers on crypto regulation.
The descent from crypto golden boy to global pariah happened swiftly. After reports emerged in November 2022 revealing the financial instability of Bankman-Fried’s companies, there was a domino effect on those businesses that included customers making a bank-style run on deposits and investigators freezing FTX assets. FTX declared bankruptcy just nine days after crypto news site Coindesk’s initial report, and Bankman-Fried’s personal net worth fell by billions of dollars.
He was arrested weeks later in the Bahamas, where he and other FTX executives lived and parts of his company were based.
Bankman-Fried’s highly anticipated trial began in October, with prosecutors alleging he misappropriated customer funds while enriching himself and buying up lavish real estate. Once known for unkempt hair and wearing casual clothes at all occasions, Bankman-Fried appeared with a new haircut and suit as he stood trial. In an unusual and ultimately disastrous move, he decided to take the stand in his own defense — leading to a damaging cross-examination where he failed to recall events and appeared to contradict himself.
Many of Bankman-Fried’s top executives and closest allies, including his on-again, off-again girlfriend Caroline Ellison, all testified against him during the trial. Ellison, the former chief executive of FTX’s trading arm Alameda Research, told the court that Bankman-Fried directed her to commit fraud and use FTX customer funds without their knowledge.
The jury in Bankman-Fried’s trial found him guilty on all seven counts of fraud and conspiracy after just four hours of deliberation. Bankman-Fried has maintained that he is innocent.
(May 8, 2019) Founding FTX
Sam Bankman-Fried, along with former Google employee Gary Wang, found the crypto exchange FTX. Bankman-Fried is in his 20s and had just left the trading firm Jane Street Capital.
(November 11, 2019) FTX receives $100m investment
Cryptocurrency exchange Binance's then CEO Changpeng Zhao invests $100m in FTX in exchange for 20% of the company.
(September 1, 2021) Bankman-Fried and FTX move to the Bahamas
Bankman-Fried relocates the firm's headquarters from Hong Kong to the Bahamas in 2021, buying up millions in real estate and setting up residence in the nation.
(August 1, 2021) Partnerships and big investments
Bankman-Fried and FTX strike a deal on the company's first big partnership, reaching a sponsorship deal with Mercedes' Formula One racing team. Meanwhile, FTX raises hundreds of millions in a funding round and is valued at $25bn.
(January 1, 2022) FTX valuation swells to $32bn
Bankman-Fried raises a $400m in a Series C financing round, as the company's valuation balloons to $32bn.
(February 1, 2022) FTX launches Super Bowl ad
Bankman-Fried pours millions of dollars into a Super Bowl ad featuring Larry David, as FTX makes a bid for the mainstream.
(April 26, 2022) Crypto Bahamas puts SBF in the spotlight
FTX holds an event called Crypto Bahamas, featuring celebrities like Gisele Bündchen and Tom Brady. Bankman-Fried appears on stage with former world leaders Bill Clinton and Tony Blair.
(October 1, 2022) Sam Bankman-Fried the campaign donor
Bankman-Fried puts around $40m into backing various political campaigns, becoming an emerging power player in Washington.
(November 2, 2022) Reports emerge of FTX's shaky finances
Cryptocurrency news site CoinDesk publishes a story showing that FTX's finances may be shakier than previously known, leading to a surge of media coverage and concern from investors. A customer run on deposits leads to crisis at the exchange.
(November 11, 2022) Bankman-Fried resigns and FTX goes bankrupt
Bankman-Fried resigns after a week of chaos and missing funds.
(November 1, 2022) Bankman-Fried arrested
Authorities arrest Bankman-Fried in the Bahamas and he is extradited to the US. He is charged with conspiracy and fraud.
(August 1, 2023) Bail revoked, sent to jail
Bankman-Fried's bail is revoked after the diary of his former FTX executive Caroline Ellison leaks to the New York Times. He is sent to jail awaiting trial.
(October 1, 2023) Trial begins
Criminal trial begins in Manhattan federal court, with former close allies and FTX executives testifying against Bankman-Fried.
(November 1, 2023) Bankman-Fried found guilty
A jury finds Bankman-Fried guilty on all seven charges of conspiracy and wire fraud. He faces potential decades in prison.
(March 28, 2024) Bankman-Fried sentenced to 25 years
In Manhattan federal court, Sam Bankman-Fried was sentenced to 25 years in prison and ordered to forfeit $11bn in assets
