The story of FTX’s cryptocurrency exchange collapse in November 2022 and the ensuing trial of its CEO, Sam Bankman-Fried, continues to astonish many due to the significant financial losses sustained. These losses pushed FTX to record lows not seen in a month.
The failure of Terra’s algorithm stablecoin before FTX’s collapse amplified the market effects. This revelation exposed a staggering $8 billion deficit in user accounts holding staked claims on FTX.
Prosecutors Charge Bankman-Fried On Seven Counts
U.S. authorities took swift action resulting in the apprehension of Bankman in the Bahamas and his transfer to the United States for trial. Facing seven charges of deception, regulatory bodies aimed to retrieve lost user funds and introduced proposed new market regulations.
Caroline Ellison, Ryan Salame, Nishad Singh, and Gary Wang, who are among SBF’s associates, were likewise charged in the case. All four opted to plead guilty and struck plea deals before SBF’s trial took place. Following an explosive trial that shook up the crypto community, a U.S. jury declared SBF guilty on all seven charges, paving the way for his potential conviction.
On March 28, the troubled ex-CEO was given a 25-year prison sentence and ordered to forfeit $11 billion. This decision sparked varied responses on social media platforms, with some calling for a harsher penalty of 40-50 years. However, the defense team argued for a more lenient 6-year term due to Bankman-Fried’s status as a first-time offender.
Prison Time and Appeal
On April 8th, Bankman-Fried’s legal team requested permission from the court to house him at the Metropolitan Detention Center rather than a federal prison in San Francisco. Simultaneously, they submitted an appeal notice to the United States District Court in the Southern District of New York.
Two weeks after the initial ruling, an appeal has been filed in the Second Circuit Court of Appeals. This court will determine if the 25-year prison sentence and $11 billion forfeiture penalty should be overturned. Various commentators have expressed different opinions regarding this appeal.
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2024-04-12 17:13