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.
American Senator Ted Cruz has broken ranks with fellow US conservatives and
hit out at talk show host Jimmy Kimmel’s suspension, saying it was “mafioso” behaviour.
Disney-owned ABC has been widely criticised after it pulled the long-standing host of Jimmy Kimmel Live following comments in his show about the alleged gunman charged with right-wing activist Charlie Kirk’s murder.
Kimmel implied the suspect was a Maga Republican, despite the man’s mother telling police he had “started to lean more to the left”.
As a result, Federal Communications Commission chair Brendan Carr threatened Disney and local broadcasters with investigations and regulatory action if they aired Kimmel’s show – which led to dozens of local TV stations affiliated with ABC pulling it.
US President Donald Trump, who appointed Carr, lauded the decision.
But Mr Cruz criticised the threats as “dangerous as hell”.
“I got to say that’s right out of ‘Goodfellas’,” he said, evoking the Martin Scorsese gangster movie. “That’s right out of
a mafioso coming into a bar going, ‘Nice bar you have here.
“It would be a shame if something happened to it’.”
Senator Ted Cruz. Pic: AP
Explainer: What did Jimmy Kimmel say about Charlie Kirk?
The senator, a former constitutional lawyer, then adopted a broad mafioso accent to quote Mr Carr’s comments about broadcasters this week: “We can do this the easy way, or we can do this the hard way.”
Mr Trump fired back, telling reporters in the Oval Office on Friday that he disagreed with Mr Cruz – one of the most
powerful Republicans in Congress – and calling Mr Carr “an incredible American patriot with courage.”
Demonstrations against his suspension have sprung up. Pic: AP
The Texas senator’s remarks are a rare example of a prominent member of the president’s own party publicly
criticising the actions of the administration, highlighting deepening concerns over free-speech rights and Mr Trump’s threatened crackdowns.
Prominent Democrats and civil rights groups condemned the Trump administration’s pressure to punish Kimmel and others who speak negatively of the president.
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US talk show titans speak out
Kimmel’s fellow late-night hosts have rallied around him, as did former US president Barack Obama, who wrote on X: “After years of complaining about cancel culture, the current administration has taken it to a new and dangerous level by routinely threatening regulatory action against media companies unless they muzzle or fire reporters and commentators it doesn’t like.
Barack Obama on Jimmy Kimmel Live in 2016. Pic: Susan Walsh/AP
“This is precisely the kind of government coercion that the First Amendment was designed to prevent, and media companies need to start standing up rather than capitulating it.”
Conservative activists had been angered by Kimmel’s comments on his show that they were using the assassination to score “political points”.
Right-wing influencer Charlie Kirk was shot dead on 10 September as he took part in a public debate at a college campus in Utah .
Tyler Robinson, 22, was charged with aggravated murder, weapon, and obstruction of justice offences.
US talk show host Stephen Colbert has condemned the cancellation of fellow late-night star Jimmy Kimmel as a “blatant assault on freedom of speech”, as America’s top late night presenters came out fighting.
He used the opening of Thursday night’s edition of his Late Show to address the pulling of Jimmy Kimmel Live over comments made about the assassination of the right-wing influencer Charlie Kirk.
Kimmel used his show earlier this week to accuse the Trump administration and its allies of “working very hard to capitalise on the murder of Charlie Kirk”, with the president among those to pin it on left-wing extremism.
The move by Disney-owned ABC has been widely criticised, with the network accused of kowtowing to President Donald Trump, who celebrated the decision.
Also airing on Thursday night, Jon Stewart, host of Comedy Central’s Daily Show, appeared in a garish gold set, in parody of Mr Trump’s redesign of the White House, to tell viewers the episode would be “another fun, hilarious, administration-compliant show”.
Stewart, playing the role of an over-the-top, politically obsequious TV host under authoritarian rule, lavished praise on the president and satirised his criticism of US cities and his deployment of the National Guard to fight crime.
“Coming to you tonight from the real […] crime-ridden cesspool that is New York City. It is a tremendous disaster like no-one’s ever seen before. Someone’s National Guard should invade this place, am I right?” he said.
He then introduced his guest – Maria Ressa, a journalist and author of the book How To Stand Up To A Dictator.
Jon Stewart. Pic: Associated Press
Over at The Tonight Show, Jimmy Fallon told his audience he was “not sure what was going on” but that Kimmel is “a decent funny and loving guy and I hope he comes back”.
Fallon then promised viewers that in spite of people being “worried that we won’t keep saying what we want to say or that we will be censored”, he was going to cover the president’s recent trip to the UK “just like I normally would”.
He was then replaced by a voiceover describing Mr Trump as “incredibly handsome” and “making America great again”.
Jimmy Fallon on Thursday’s Tonight Show. Pic: The Tonight Show X
Seth Meyers also joined the fray.
“Donald Trump is on his way back from a trip to the UK,” he said at the top of his show Late Night, “while back here at home, his administration is pursuing a crackdown on free speech… and completely unrelated, I just wanted to say that I have always admired and respected Mr Trump.
“I have always believed he was a visionary, an innovator, a great president, and an even better golfer.”
Kimmel’s removal from the show he has hosted for two decades led to criticism that free speech was under attack.
But speaking on his visit to Britain, Donald Trump claimed he was suspended “because he had bad ratings”.
It came after fellow late-night host Colbert saw his programme cancelled earlier this year, which fans claimed was also down to his criticism of Mr Trump, who has since railed against Kimmel, Meyers, and Fallon.
He has posted on Truth Social that they should all be cancelled.
Jimmy Kimmel hosting last year’s Oscars. Pic: AP
Figures from both the worlds of entertainment and politics lined up to lament ABC’s removal of Kimmel.
Chat show doyenne David Letterman said people should not be fired just because they don’t “suck up” to what he called “an authoritarian” president.
During an appearance at The Atlantic Festival 2025 in New York on Thursday night, he added: “It’s no good. It’s silly. It’s ridiculous.
“I feel bad about this, because we all see where see this is going, correct? It’s managed media.”
Barack Obama on Jimmy Kimmel Live in 2016. Pic: Susan Walsh/AP
Former US president Barack Obama wrote on X: “After years of complaining about cancel culture, the current administration has taken it to a new and dangerous level by routinely threatening regulatory action against media companies unless they muzzle or fire reporters and commentators it doesn’t like.
“This is precisely the kind of government coercion that the First Amendment was designed to prevent, and media companies need to start standing up rather than capitulating it.”
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