Sam Bankman-Fried faces sentencing in cryptocurrency fraud scheme (2024)

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Sam Bankman-Fried faces sentencing in cryptocurrency fraud scheme? ›

The scale of his crimes is measured not just by the amount of money that was stolen, but by the extraordinary harm caused to victims, who in some cases had their life savings wiped out overnight. As a result of his unprecedented fraud, Bankman-Fried faces 25 years in prison and forfeiture of over $11 billion dollars.

Bankman-Fried earned the name'Crypto King' due to his remarkable success with FTX. The exchange became the world's second-largest, facilitating the trade of numerous virtual currencies, including Bitcoin. The platform helped him shoot to fame and amass a net worth of $26 billion by the age of 30.

In early 2022, investors valued FTX and its U.S. operations at a combined $40 billion. Most of his wealth, which peaked at an estimated $26.5 billion, was tied up in ownership of about half of FTX and a share of its FTT tokens.

Court documents show Sam Bankman-Fried and his associates spent voraciously on investments, donations and real estate even in the crypto exchange's final months. Subscribers can give anyone free access to articles.

Almost all customers of collapsed cryptocurrency exchange FTX will get their money back — and more, according to a court filing. FTX estimates that it owes creditors around $11.2 billion. FTX said that it has between $14.5 billion and $16.3 billion to distribute to creditors.

Bruch is one of the largest individual FTX creditors and has been tapped by the US Department of Justice to serve as one of nine on the FTX Creditors' Committee, where he is working to recoup the funds lost by customers.

Kaplan found that FTX customers lost $8 billion, FTX's equity investors lost $1.7 billion, and that lenders to the Alameda Research hedge fund Bankman-Fried founded lost $1.3 billion. He imposed an $11 billion forfeiture order and authorized the government to repay victims with seized assets.

The former FTX CEO has agreed to lend his support to a class-action lawsuit, filed by a group of FTX investors in November 2022, against a handful of celebrities, including Larry David, Tom Brady, Shaquille O'Neal, the Golden State Warriors, and Naomi Osaka, who endorsed the crypto exchange.

What did FTX do with customer funds? ›

At trial, the court heard from an accounting expert who said that $11.3bn in customer funds were supposed to be held at Alameda Research, FTX's hedge fund arm. But only $2.3bn could be located. The rest had gone toward investments, political contributions, charity foundations and real estate purchases.

Satoshi Nakamoto created Bitcoin in 2009. The name "Satoshi Nakamoto" is the pseudonym for the person or people who introduced the concept of Bitcoin in a 2008 paper. 1 Nakamoto remained active in the creation of Bitcoin and the blockchain until about 2010 but has not been heard from since.

Changpeng Zhao (CZ): Known as CZ, Changpeng Zhao is the CEO of Binance, one of the largest and most influential cryptocurrency exchanges in the world.

Satoshi Nakamoto is the name used by the presumed pseudonymous person or persons who developed Bitcoin, authored the Bitcoin white paper, and created and deployed Bitcoin's original reference implementation.