The courtroom drama unfolding around FTX founder and former CSam Bankman-Fried (SBF) has all the ingredients of a binge-worthy Netflix series, replete
The courtroom drama unfolding around FTX founder and former CSam Bankman-Fried (SBF) has all the ingredients of a binge-worthy Netflix series, replete with a cast of shady characters and a plot that thickens with each passing day. Among the highlights were SBF’s lofty presidential ambitions and a staggering $100-150 million bribe to Chinese officials, which add a surreal twist to the narrative.
If SBF aimed to script a thrilling courtroom drama for his Netflix debut, he’s nailed it. However, when it comes to establishing his innocence, the plot leaves much to be desired.
The courtroom was electrified by testimony from Caroline Ellison, the former CEO of Alameda Research, FTX’s trading arm. It resonated with brutal honesty that’s rare in such high-stake trials. It was emotional and raw, in a sincere way. One shocking revelation she shared was that the company created seven fraudulent balance sheets created seven fraudulent balance sheets, laid out for SBF to cherry-pick one that would best serve his agenda.
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“When I started working at Alameda, I don’t think I would have believed you if you told me I would be sending false balance sheets to our lenders, or taking customer money, but over time, it was something I became more comfortable with,” Ellison told jurors.
The jury doesn’t seem to need a spoiler alert to predict the ending of this story. The overwhelming evidence points towards a guilty verdict, a risk calculus that seems to elude SBF. Which isn’t surprising given that he was ultimately responsible for calculating the odds for FTX’s risk management before it imploded.
Fun Fact from the FTX Trial: Caroline Ellison prepared seven different fake balance sheets to send to Genesis after they asked for $500M back from Alameda and asked Sam to pick his favorite version of BS a la carte to send them. Ultimately, Caroline claims they didn’t even care
— Autism Capital (@AutismCapital) October 14, 2023
When the gavel finally falls, it’s likely to echo the verdict handed down to Theranos founder Elizabeth Holmes — though it could easily surpass her 11-year sentence. (He’s facing a combined total of more than 100 years.) And the legal rollercoaster doesn’t end here for SBF, because a second trial is due to begin in March. That trial will include six charges beyond the seven in court today, including campaign finance violations.
Grifters are going to grift. But what are the takeaways from this riveting saga?
There’s a profound lesson to be learned from the SBF trial. While cryptocurrency is hailed for its potential to redefine the financial ecosystem, the trial is showing how traditional financial deceit can infiltrate the space, casting long shadows over the revolutionary promise of blockchain technology.
SBF trial exhibits (much) earlier today: DOJ proves venue via emails including this one showing Bankman-Fried scheduling facetime with Bill Clinton at Clinton Initiative parallel to (corrupt) UN General Assembly week 2022 as FTX customers’ money was potlatched pic.twitter.com/sxjwpvy9Vn
— Inner City Press (@innercitypress) October 18, 2023
As SBF awaits his fate in the courtroom, the crypto community should seize this moment to reflect, learn, and realign with the fundamental ethos of cryptocurrency. The journey of self-custody may be laden with challenges, but it’s a path that leads to financial autonomy and empowerment, embodying the true spirit of what cryptocurrencies are envisioned to be.
As the trial unfolds and the crypto world watches with bated breath, let it serve as a catalyst for introspection and a return to basics of self-custody and decentralization.
FTX’s fall from grace wasn’t a product of crypto’s inherent flaws but a classic tale of financial deceit, where the crypto landscape was merely the backdrop. The fraud wasn’t unique to the crypto domain; it was the age-old narrative of unaudited balance sheets meeting fraud, a scene right out of the traditional finance playbook.
Related: Michael Lewis’ new book puts a positive spin on Sam Bankman-Fried
This trial isn’t just a sensational headline; it’s a stark reminder of the perils of veering away from the core principles of cryptocurrency. The ethos of crypto is rooted in the elimination of middlemen, which stands in stark contrast to the narrative SBF spun around his empire.
While the founders of bona fide crypto exchanges like Coinbase and Kraken advocate for the mantra of “not your keys, not your coins,” promoting self-custody, SBF championed the opposite, urging investors to entrust him with their digital assets — perhaps because he planned to steal them.
A slew of crypto investors, enticed by the mirage of convenience, relinquished the responsibility of self-custodying their assets, allowing SBF and his crew of pirates to steer the ship, much to their detriment.
The traditional banking system, with its ease and convenience, comes at a hefty price—…
cointelegraph.com