Sam Bankman-Fried sentence: After years of ‘hubris, incompetence and greed’, crypto king’s jail term is end of an era
Sam Bankman-Fried was breathlessly described as a wunderkind – a boy wonder transforming the world of finance.
Renowned for his messy hair and unkempt appearance, he graced the covers of Forbes and Fortune, who pondered whether he could become the next Warren Buffett.
The 32-year-old was the founder of FTX, which had quickly become the world’s second-largest cryptocurrency exchange – a place where investors could buy and sell digital assets like Bitcoin.
Larry David appeared in an advert for FTX during the Super Bowl in 2022
Star-studded adverts featuring the tennis player Naomi Osaka and the comedian Larry David added to its allure – with eye-watering sums spent on sponsorship deals.
But in November 2022, Bankman-Fried’s crypto empire came crashing down after it emerged that customer funds worth $10bn (£7.9bn) was missing.
A year later, a jury convicted the fallen entrepreneur of fraud and money laundering after just five hours of deliberations – based on evidence from close colleagues who had turned against him.
Now, “SBF” is beginning a lengthy prison sentence of 25 years for what prosecutors have described as “one of the biggest financial frauds in American history”.
His punishment may be little comfort to five million FTX customers who were suddenly locked out of their accounts as the company entered bankruptcy – and are yet to receive any compensation.
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November: ‘Crypto king’ guilty of fraud
An estimated 80,000 of Bankman-Fried’s victims were based in the UK. Some of them had millions of pounds tied up in the company after entrusting him with their life savings.
While slick marketing campaigns had presented FTX as a safe way to invest in volatile cryptocurrencies, the reality behind the scenes couldn’t have been more different.
Secret back doors had been established that allowed SBF’s other company, Alameda Research, to access money belonging to FTX customers and make risky bets without their knowledge.
Meanwhile, executives were spending lavishly. Private jets ferried Amazon orders from Miami to the firm’s headquarters in the Bahamas, £12m was spent on luxury hotel stays in just nine months, and employees in the US were allowed to order £160 of food deliveries each a day.
The fallout from FTX’s demise also reaches as far as the White House. Bankman-Fried was one of the largest donors to Joe Biden’s campaign in 2020, with the president subsequently facing pressure to return millions of dollars.
Read more:
Who is Sam Bankman-Fried?
SBF ‘wanted to be US president’
Sam Bankman-Fried’s colleague and on-off girlfriend Caroline Ellison testified against him. Pic: Reuters
A new chief executive has been tasked with untangling where all the money went. Soon after FTX went under, he said: “Never in my career have I seen such a complete failure of corporate controls.”
Unusually, and thankfully, FTX victims are expected to be compensated in full eventually – kind of.
The payouts they receive will be based on what cryptocurrencies were worth in November 2022. But Bitcoin was trading at £16,000 back then and is now worth £55,500.
Bizarre plans to bring FTX out of bankruptcy and reopen the exchange have also been abandoned.
Other entrepreneurs in this space – who had loyal, cult-like followings and huge profiles – are also facing jail time.
Changpeng Zhao has pleaded guilty to money laundering charges. Pic: Reuters
Changpeng Zhao, who ran the world’s biggest crypto exchange Binance, sensationally resigned last year after pleading guilty to money laundering violations in the US.
His company had allowed individuals in Syria, Iran and Russian-occupied parts of Ukraine to evade economic sanctions – and allegedly made it easy for terrorists and criminals to move money.
The billionaire faces jail time when he is sentenced next month.
Do Kwon created two cryptocurrencies that spectacularly collapsed in May 2022, with investors losing an estimated $40bn (£31.7bn) in a matter of days.
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He later went on the run but was captured in Montenegro last year after attempting to fly to Dubai using a fake passport.
A civil fraud trial against Kwon and his company Terraform Labs began this week, with prosecutors warning: “Terra was a fraud, a house of cards, and when it collapsed, investors nearly lost everything.”
Do Kwon created two cryptocurrencies that lost tens of billions of dollars – then went on the run. Pic: Reuters
In a way, Bankman-Fried’s sentence marks the end of an era for crypto – when extravagant excesses and a lack of regulatory oversight were the norm.
Bitcoin’s recent gains have been driven by regulated products that allow investors to gain exposure to the cryptocurrency’s price without owning it directly.
And many of these products are offered by established, traditional finance firms like BlackRock, which is the world’s largest asset management company.
A damning report described the rise and fall of FTX as a tale of “hubris, incompetence and greed” – with Bankman-Fried and his inner circle showing little regard for the financial wellbeing of his customers.
Millions of people had their fingers burned, and many will be put off from ever investing in cryptocurrencies again.
But while the industry has learned some lessons, the crypto market’s rapid surge in recent months mean there’s a real risk of another bubble forming – and new bad actors taking advantage of investors looking for a piece of the action.
World
Ukraine war: ‘We’ve never been closer to a peace deal’ – Trump and Putin to hold talks on ending conflict
Donald Trump will speak to Vladimir Putin by phone later today – with the White House saying “we’ve never been closer to a peace deal” in Ukraine.
In a post on Truth Social, the US president said he would be speaking to his Russian counterpart on Tuesday morning – adding: “Many elements of a Final Agreement have been agreed to, but much remains.
“Thousands of young soldiers, and others, are being killed. Each week brings 2,500 soldier deaths, from both sides, and it must end NOW.”
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What will Trump and Putin discuss?
While aboard Air Force One, Mr Trump had told reporters that land and power plants were part of the conversation on bringing the war to a close.
After crunch talks in Saudi Arabia between US and Ukrainian diplomats, Volodymyr Zelenskyy said last week that Kyiv would accept a 30-day pause in fighting if Russia committed to it as well.
Since then, Mr Putin has said he agrees fighting in Ukraine should end – but warned “lots of questions” remain over the proposed ceasefire.
He has also met US envoy Steve Witkoff to discuss the details of the proposal.
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‘We have to keep pressure on Putin’
It comes as Ukraine’s air defence units said they shot down 90 of 174 drones launched by Russia in an overnight attack on Monday.
Russia has been attacking the Odesa region with drones and missiles on a daily basis for three weeks, the air force said – adding that 70 other drones were disrupted in the attack.
Odesa Governor Oleh Kiper added a civilian was injured during the strikes, which damaged a kindergarten, a house, a shop and a car.
Biden children’s security detail revoked
In other developments, Mr Trump said on Truth Social that he is “immediately” revoking Secret Service protection that was being given to Joe Biden’s children.
He claimed 18 agents were assigned to Hunter Biden’s protective detail while in South Africa this week – and added Ashley Biden had 13 agents assigned to her detail who “will be taken off the list”.
World
Israel carries out ‘extensive strikes’ in Gaza – and warns it will act with ‘increasing military force’
Israel says it is currently carrying out “extensive strikes on terror targets” across the Gaza Strip.
A statement added that “from now on, Israel will act against Hamas with increasing military force”.
According to the Reuters news agency, a senior Hamas official said Israel is unilaterally ending the Gaza ceasefire agreement.
Early on Tuesday, the Hamas-run Gaza Health Ministry said at least 44 people were killed in the airstrikes.
An ambulance outside al Aqsa Hospital. Pic: AP
In a statement, the Prime Minister’s Office said Benjamin Netanyahu and defence minister Israel Katz ordered the Israeli Defence Forces (IDF) to “act forcefully” against Hamas.
It came after the militant group “repeatedly refused to release our hostages and rejected all offers it received from the US presidential envoy, Steve Witkoff, and from the mediators”.
“The operational plan was presented late last week by the IDF and approved by the political echelon,” the statement added.
The IDF and Shin Bet described the strikes as “extensive” – and said they were against “terror targets belonging to the Hamas terrorist organization in the Gaza Strip”.
Last week, the Gaza health ministry said nine Palestinians, including three journalists, were killed in an Israeli airstrike in the northern town of Beit Lahia.
‘I wish to leave’
A Palestinian source who lives in central Gaza told Sky News’ US correspondent Mark Stone the strikes were “not a surprise” and that “I guess the strongest ones can do whatever they want”.
The source then said, according to Mr Stone, that “we were sure that this war wouldn’t end” and added: “I wish they (Israel) would open the Rafah border crossing (into Egypt).
“I wish to leave. I cannot take it anymore.”
It comes almost two months after a three-phase ceasefire was reached by Hamas and Israel to pause the war.
Over the first phase of the ceasefire, which lasted six weeks, Hamas released 33 Israeli hostages held in Gaza and five Thai nationals, in exchange for around 2,000 Palestinian prisoners and detainees.
But since the first phase officially concluded, both Israel and Hamas have failed to agree on how to progress with the second phase – which would see the release of the remaining Israeli hostages and end the withdrawal of Israeli troops from the Gaza Strip.
US Middle East envoy Steve Witkoff proposed extending the first phase through to the end of Ramadan and Passover, or until 20 April, which Hamas rejected.
At the start of March, Israel said it stopped all goods and supplies to Gaza after claiming Hamas was refusing to “accept the Witkoff outline for continuing the talks, which Israel agreed to”. Hamas called it “a war crime and a blatant attack”.
Five days later, Israel said it had cut off the electricity supply to Gaza.
The war in Gaza began after Hamas militants carried out a cross-border raid into southern Israel on 7 October 2023, killing 1,200 people and capturing around 250 hostages, according to Israeli officials.
Israel responded by launching an air and ground offensive in Gaza which has killed more than 48,000 Palestinians, say Gaza health officials.
Meanwhile, White House press secretary Karoline Leavitt said in a Fox News interview that US President Donald Trump’s administration was consulted by Israel on the strikes earlier on Monday.
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Mixed martial arts fighter Conor McGregor has met Donald Trump in the Oval Office after complaining about Ireland’s “illegal immigration racket”.
The 36-year-old told Mr Trump that his work ethic was “inspiring”, with the two men sharing jovial comments about the fighter’s suit and a map featuring the Gulf of Mexico labelled as the Gulf of America.
In comments made in the White House briefing room before the meeting during the St. Patrick’s Day visit, he said he was visiting the White House to “raise the issues the people of Ireland face”.
“What is going on in Ireland is a travesty,” he said. “Our government is the government of zero action with zero accountability.”
Trump and McGregor meeting in the Oval Office. Pic: X/@MargoMartin47
McGregor warned “Ireland is at the cusp of potentially losing its Irishness” due to the “illegal immigration racket”.
“Ireland and America, we are siblings. We consider America our big sibling. So it’s important for Ireland to be a peaceful, prosperous country for 40 million Irish Americans to have a place to visit, [to] come back to their home.
“So we wish for our relationship with the United States to continue, and we wish to be taken care of by the big bro. The United States should look after its little bro. And that’s how we feel,” McGregor said.
White House press secretary Karoline Leavitt, who appeared alongside McGregor in the briefing room, said: “We couldn’t think of a better guest to have with us on St. Patrick’s Day.”
At a meeting with Irish Prime Minister Micheal Martin last week, Mr Trump said McGregor was his favourite Irish person partly because “he’s got the best tattoos I’ve ever seen”.
UFC fighter Conor McGregor speaks with White House press secretary Karoline Leavitt at his side during a visit to the White House in Washington. Pic: Reuters
But Mr Martin and deputy prime minister Simon Harris have been critical of today’s Trump-McGregor meeting.
In a post on X, Mr Martin said: “McGregor’s remarks are wrong, and do not reflect the spirit of St Patrick’s Day, or the views of the people of Ireland.”
Meanwhile, Mr Harris said that McGregor was not in the US to represent Ireland and did not speak for the people of Ireland, and “has no mandate to”.
In exclusive comments made to Sky News’ David Blevins about Mr Martin’s comments, McGregor said: “Shame on him for saying that, speaking down on an Irish man.”
He added: “Every metric available to us has shown that the government of Ireland has failed the people of Ireland.”
Mr Trump is well known for his support of Ultimate Fighting Championship, which McGregor is best known for competing in, and attended bouts during the 2024 presidential campaign.
Read more: The deepening ties that led to the controversial Tates flying to freedom in US
McGregor is a controversial figure in Ireland after a woman who accused him of raping her won her civil case and was awarded more than £200,000 in damages.
Tesco was among the retailers that stopped selling alcohol brands linked to McGregor after Nikita Hand was awarded €248,603 (£206,000) after a jury found McGregor assaulted her in a hotel in 2018.
McGregor is appealing against the outcome of the civil case.
McGregor also pleaded guilty to assaulting a man in a Dublin pub in 2019 and has been subject to several other allegations of assault and sexual assault.
His social media posts were also linked to the 2023 Dublin riots. Irish police were reportedly investigating McGregor’s posts for alleged incitement to hatred in relation to the riots.
McGregor, nicknamed the Notorious, rose to worldwide prominence for winning several UFC championships.
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