Convicted of fraud in November, Sam Bankman-Fried, the fallen cryptocurrency superstar, was sentenced to twenty-five years in prison on Thursday March 28.
New York prosecutor Damian Williams demanded between forty and fifty years in prison for the former crypto star, whom a Manhattan jury found guilty of the seven charges against him. “SBF” – its nickname – used, without their consent, the assets of customers of its digital currency exchange platform FTX, to carry out risky transactions by its sister company Alameda, to purchase real estate or to make political donations.
Subject to massive withdrawal requests from panicked customers, FTX imploded in November 2022. At the time of its bankruptcy filing, around $9 billion (€8.3 billion today) was missing. In a few hours, the image of the whimsical little genius, with full hair and perpetual shorts and t-shirts, collapsed, giving way to that of a sorcerer’s apprentice, a fan of crazy bets.
The group’s liquidators have already recovered about $6.4 billion in cash and plan to fully reimburse injured customers. They are benefiting in particular from the brutal appreciation of cryptocurrencies, which have recovered after a catastrophic 2022 vintage marked by several bankruptcies and punctuated by the FTX scandal.
Driven by an influx of investors and the marketing of a new investment product, the queen of digital currencies, bitcoin, has set records since the beginning of March.
“Pernicious megalomania”
Faced with the threat of a very heavy sentence, the lawyers of Sam Bankman-Fried, who has just celebrated his 32nd birthday, sought to portray a more human “SBF” than the manipulator described during his trial. “Those who know Sam know that he is selfless, selfless,” his counsel wrote in a document submitted to federal Judge Lewis Kaplan before the hearing, along with dozens of letters of support from loved ones.
The people who knew him “understand that his conduct was ‘never motivated by greed or a thirst for prestige,’” the lawyers argued, citing one of the testimonies in support of their request.
The fact is that the former student of the Massachusetts Institute of Technology (MIT) was never accused of personal enrichment and kept, until the end, most of his fortune in FTX shares, whose value s ‘is evaporated.
During his trial, which lasted five weeks, the lawyers of “SBF” presented him as a young business manager overwhelmed by his workload and victim of the errors of judgment of his partners and employees.
To obtain clemency from the federal magistrate, they also mentioned the fact that this former trader had autism spectrum disorders, which makes him, according to them, “vulnerable within a prison population.”
“In every aspect of his activity and for each of the crimes committed, the accused has shown an open lack of respect for the law,” replied the Williams prosecutor’s office. During the trial, Sam Bankman-Fried’s defense was weakened by the testimonies of three former FTX and Alameda executives, including his former girlfriend, who had all highlighted, in detail, the driving role of the accused in the fraud. “He understood the rules, but decided that they did not apply to him,” insisted the prosecutor’s office in a document sent to the judge, citing “pernicious megalomania” and “a superiority complex.”
