Embezzled billions of dollars: Founder of failed cryptocurrency exchange FTX found guilty

This 31-year-old became a billionaire due to the great growth in the value of bitcoin and other cryptocurrencies, and with the collapse of his stock market, he lost everything, including his freedom

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Detail from the trial, Photo: Reuters
Detail from the trial, Photo: Reuters
Disclaimer: The translations are mostly done through AI translator and might not be 100% accurate.

The founder of the failed cryptocurrency exchange "FTX", Sam Bankman-Frid, was found guilty for his role in the bankruptcy of that company and the embezzlement of several billion dollars from clients, reports RTS.

After 15 days of testimony and about four and a half hours of deliberation, jurors decided to find Sam Bankman-Frid guilty on seven counts of fraud and conspiracy, reports CNN.

This 31-year-old became a billionaire due to the great growth in the value of bitcoin and other cryptocurrencies, and with the collapse of his stock market, he lost everything, including his freedom.

The exchange, which launched in 2019 and is headquartered in the Bahamas, filed for bankruptcy in November last year. It had previously struggled to raise cash to prevent a collapse, as traders rushed to withdraw $72 billion from the platform in just XNUMX hours.

Detail from the trial
Detail from the trialphoto: Reuters

It then emerged that Bankman-Fried had been secretly using multi-billion dollars of client funds to keep "FTX" going.

Almost a year after his arrest, Bankman-Fried was found guilty of stealing several billion dollars from accounts belonging to FTX clients, as well as defrauding the lenders of a sister company, the hedge investment fund Alameda Research, in whose account the funds were found of clients of the stock exchange.

During the trial, Bankman-Fried said that he learned in 2020 that the funds of FTX clients were held by Alameda Research, but did not take steps to protect them. When he discovered later in the fall of 2022 that the fund owed eight billion dollars to "FTX", no one was fired.

Other charges to which Bankman-Fried was found guilty include defrauding investors in "FTX" and a charge of money laundering.

Prosecutor Damian Williams praised the jury's verdict, noting that the government has no tolerance for fraud and corruption.

"These players like Sam Bankman-Fried may be new, but this kind of fraud, this kind of corruption, is as old as time," the prosecutor said.

Defense attorney Mark Cohen says they respect the jury's decision but are disappointed by it.

"Sam Bankman-Fried maintains his innocence and will continue to vigorously fight the allegations against him," Cohen said.

The sentencing is scheduled for the end of March 2024. The trial was closely watched by regulators, investors and the crypto community.

The "FTX" platform was one of the most trusted cryptocurrency exchanges.

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