FTX Founder Sam Bankman-Fried Released On $250 Million Bail

December 26, 2022 1:21 pm Comments

Although former FTX CEO Sam Bankman-Fried was previously arrested in the Bahamas, it seems that he is now back in the US after being released on a $250 million bail.

This was done ahead of the ongoing trial against him where he faces charges of fraud from both the SEC and the CFTC.

Right now, the current accusation is that billions of dollars in investor funds are now missing from FTX and that the funds were illegally used for personal reasons.

It is scheduled that the next trial hearing will be next year in January 3rd and investors are continuing to hear more information on what really happened with the customer funds within FTX.

TheVerge reports:

Yesterday, Bankman-Fried was still on his way back to the US after being extradited by the Bahamas when a US attorney announced that Caroline Ellison, who was the CEO of SBF’s crypto trading firm Almeda Research, and Gary Wang, the co-founder and former CTO of FTX, had pleaded guilty to federal charges, and are cooperating with prosecutors. Now the DOJ has unsealed their guilty pleas and charges — which they submitted a few days ago on the 19th but were held until SBFs extradition had been secured — while redacting certain information.

As we learned on Wednesday from civil suits filed against them by the SEC and CFTC, prosecutors assert SBF directed Wang to create the ability for Alameda Research and executives at the firm to have “carte blanche” access to FTX customer funds that they used for trading, political donations, paying debts, and on themselves.

The lawsuits lay out that Ellison, at the direction of SBF, not only dipped into the FTX customer funds but also manipulated markets to raise the price of FTX’s FTT cryptocurrency token — which the SEC has deemed a security — allowing FTX to use it as collateral in loans and acquisitions.

Both pleaded guilty to charges of wire, commodities, and securities fraud, in addition to charges of money laundering for Ellison.

Based on this, it seems likely that there is a good chance that the capital was used for market manipulation as well with a strong focus on the FTX token.

The effects of the FTX collapse has so far sent a shock across the entire crypto industry as more investors are now realizing the importance of self-custody when it comes to crypto.

Basically, crypto is only truly safe when it is owned by a wallet that you control and only you have the private key to the blockchain wallet.

When it is stored on an exchange like FTX, control is technically not in your hands as you are trusting a third-party service to hold your assets for you.

Being able to have self-custody of your own assets is one of the main things that makes crypto so attractive when compared to other options like fiat.

TheVerge concludes:

In a statement, U.S. Attorney Damian Williams said, “Last week, we announced charges against Samuel Bankman-Fried for a sweeping fraud scheme that contributed to FTX’s collapse and for a campaign finance scheme that sought to influence public policy in Washington.

As I said last week, this investigation is very much ongoing, and it’s moving very quickly.

I also said that last week’s announcement would not be our last, and let me be clear once again, neither is today’s.”

Join the conversation!

We have no tolerance for comments containing violence, racism, profanity, vulgarity, doxing, or discourteous behavior. If a comment is spam, instead of replying to it please click the icon below and to the right of that comment. Thank you for partnering with us to maintain fruitful conversation.