FTX Token

FTX’s FTT token rallies 30% — Binance effect or FTX 2.0 reopening?

November 23, 2023 Coin Telegraph

Binance

This surge suggests significant institutional attention despite the token’s historical association with FTX’s financial challenges.

Amid market uncertainties around Changpeng "CZ" Zhao’s departure as Binance CEO, the in-house cryptocurrency of the FTX crypto exchange, FTX Token (FTT), witnessed a momentary bull run. FTT surged in market value by more than 55% in the past 48 hours and is currently trading at $4.63, reflecting a 30% increase from $3.56.

FTX’s native token is experiencing another surge following Binance’s $4.3 billion settlement with the United States Department of Justice , according to on-chain analyst firm Santiment. This goes against expectations that FTT would fall in price because it's the new token representing the FTX crypto exchange’s relaunch (FTX 2.0). The token’s value appears to have been boosted, with the ten largest wallets accumulating $12.8 million in coins in 19 days.

According to Santiment, FTT has recorded 337% growth on the monthly chart, with a significant portion of these gains occurring in the last ten days. Notably, the top 10 whale wallets have been heavily accumulating FTT during this period, leading to a 255% increase in FTT’s market value compared to Bitcoin.

Those who took a chance on $FTT continue to be rewarded, with a second rally for #FTX's native token coming after yesterday's #Binance news. Its price appears to have been boosted by the 10 largest wallets accumulating $12.8M worth of coins in 19 days. https://t.co/V3QNq91asF pic.twitter.com/DL5pkVfW96
— Santiment (@santimentfeed) November 23, 2023

FTX’s recent approach of liquidating assets and transferring substantial funds across different exchanges has triggered heightened activity in the cryptocurrency market. In a significant move, FTX and its affiliate, Alameda Research, executed a remarkable transfer of assets totaling $474 million.

However, this move could generate a depreciating effect on the FTT price. Data from Cointelegraph Markets Pro shows a decent chance to establish a price bottom at current lows since the market is now digesting the bad news.

This move is part of a broader effort to manage the exchange’s financial obligations and potentially pave the way for a new phase known as “FTX 2.0.” The FTX team plans to restart the exchange by the second quarter of 2024. Notably, this rise in FTT price occurs in the context of Binance’s $4.3 billion settlement with the United States Department of Justice.

In contrast, Binance’s BNB token declined, experiencing a 13% drop to $235. Data from DefiLlama showed that Binance’s 24-hour outflows topped $1 billion as of 3:30 pm, Hong Kong time on Nov. 22. The exchange’s net outflows over seven days amounted to $703.1 million.

In his introductory post on "X" (formerly Twitter) as Binance’s new CEO, Richard Teng, who replaced CZ, said that “the foundation on which Binance stands today is stronger than ever.” Teng said he would initially focus on three aspects of the business: reinstating investor confidence, collaboration with regulators and driving Web3 adoption.

Magazine: This is your brain on crypto: Substance abuse grows among crypto traders

Sam Bankman-Fried blamed Binance for balance sheet leak to media: Court evidence

October 12, 2023 Coin Telegraph

Binance

An internal document was revealed in court showing Sam Bankman-Fried believed Binance leaked Alameda’s balance sheet to the media in 2022.

Evidence presented in court as a part of the ongoing criminal trial against Sam “SBF” Bankman-Fried, former CEO of crypto exchange FTX, reveals SBF believed Binance leaked an Alameda balance sheet to the media in 2022.

On Oct. 11, Caroline Ellison, former CEO of Alameda Research, said SBF created a memo that dates back to Nov. 6, 2022 and that outlined possible investors and other parties to reach out for a bailout.

According to the document, Bankman-Fried wrote that Binance had been “engaging in a PR campaign against us.”

It continued to say that Binance “leaked a balance sheet; blogged about it; fed it to Coindesk; then announced very publicly that they were selling $500m of FTT in response to it while telling customers to be wary of FTX.”

On Nov. 2, 2022, CoinDesk reported that it saw a balance sheet from Alameda and that the firm was possibly not in good standing. This was a key event in the lead-up to the run on FTX and its ultimate bankruptcy.

SBF also noted that FTX was capitalized but not entirely liquid, which Ellison clarified by saying that out of the $12 billion in client assets said to be held by the exchange, only $4 billion was available to process withdrawals.

The document also revealed Justin Sun, the founder of the Tron network and a Huobi adviser, as a potential investor — though it reads that it “turns out he’s close to [Binance CEO] CZ.”

Inner City Press, which has been in the courtroom, reported on X (formerly Twitter) that Ellison said she was “stressed” when Changpeng Zhao tweeted about liquidating his share of FTX Token (FTT).

Ellison: The tweet characterizes the delay as being about anti-spam and nodes. But we just didn't have the money.
AUSA: Are these the tweets of CZ of Binance?
Ellison: Yes. He tweeted, "we have decided to liquidate any FTT on our books." I was stressed out.
— Inner City Press (@innercitypress) October 11, 2023

This is the second week of Bankman-Fried’s criminal trial. He faces seven charges of conspiracy and fraud tied to the collapse of FTX, to which he has pleaded not guilty.

A second trial is scheduled for sometime in March 2024, during which SBF will face another six charges, including bank fraud and foreign bribery conspiracy charges.

Ellison has been a key witness in the trial thus far and is scheduled for cross-examination by the defense’s attorneys on Oct. 12.

Cointelegraph reporters are on the ground in New York covering the trial. As the saga unfolds, check here for the latest updates.

Magazine: SBF trial underway, Mashinsky trial set, Binance’s market share shrinks: Hodler’s Digest, Oct. 1–7

Caroline Ellison testimony: SBF bribed Chinese officials for $150M to unfreeze funds

October 12, 2023 Coin Telegraph

Caroline Ellison testimony: SBF bribed Chinese officials for 0M to unfreeze funds

Coin Telegraph

Caroline Ellison, the star witness in the Sam Bankman-Fried criminal trial, testified that SBF tried to use identities linked to Thai sex workers to unfreeze funds before bribing Chinese officials for millions.

Caroline Ellison, the former romantic partner of embattled FTX founder Sam “SBF” Bankman-Fried and the former CEO of Alameda Research, has claimed in her courtroom testimony that SBF bribed Chinese officials for millions of dollars to unfreeze funds locked in local exchanges.

In her Oct. 11 testimony, Ellison said there was $1 billion in funds locked up in China and that to access them, Alameda paid a $150 million bribe to Chinese government officials.

AUSA: How much was frozen in China?
Ellison: $1 billion. Sam wanted to find ways to address it.
AUSA: How were they unfrozen?
Ellison: Alameda paid a bribe to Chinese government officials
SBF: Objection, move to strike.
Judge Kaplan: I will strike that
— Inner City Press (@innercitypress) October 11, 2023

The funds, which belonged to Alameda Research, were frozen on the cryptocurrency exchanges Huobi and OKX following a 2021 money laundering probe opened by Chinese authorities.

Ellison testified that Bankman-Fried ordered her and other FTX employees to delete all related messages sent via the encrypted messaging app Signal.

However, before bribing Chinese officials, Ellison said they attempted to hire a local lawyer in China who could help with negotiations with the government.

After attempts with lawyers were unsuccessful, Ellison claimed that Bankman-Fried attempted to use wallets of “other people’s accounts” to unsuccessfully access the funds. This included what turned out to be Thai sex workers.

Ellison said, “On OKX, we made several accounts using the IDs of different people who I believe were Thai prostitutes, and we tried to basically have our main account lose money and have those other accounts make money, so do very imbalanced trades between the two accounts so those other accounts would be able to make money and withdraw it.”

When questioned how the accounts were ultimately unfrozen,, Ellison said she thought they were unfrozen after Alameda paid the bribe.

According to a post on X (formerly Twitter) from a witness in the courtroom, Ellison must return on Oct. 12 for a cross-examination from SBF’s lawyer, Mark Cohen.

Oh, she has to (come back tomorrow) - now for cross examination by Bankman-Fried's lawyer Mark Cohen, which began a big slow and disorganized at the end of today's session. We'll see tomorrow - I aim to be live tweeting it, starting at 9:30 am https://t.co/mUdG7ST2qm
— Inner City Press (@innercitypress) October 12, 2023

SBF faces 13 charges. The first seven charges of fraud are being heard in his current trial, which began on Oct. 3 and do not include charges of bribing Chinese officials.

However, in a second trial scheduled for March 2024, he faces six additional charges, including bank fraud and foreign bribery conspiracy charges. Bankman-Fried has pleaded not guilty to all charges.

Cointelegraph reporters are on the ground in New York covering the trial. As the saga unfolds, check here for the latest updates.

Magazine: SBF trial underway, Mashinsky trial set, Binance’s market share shrinks: Hodler’s Digest, Oct. 1–7

FTX co-founder Wang discusses plea deal, knowledge of financial concepts at SBF trial

October 10, 2023 Coin Telegraph

Coin Telegraph

On the final day of his testimony, FTX co-founder Wang discussed talking to the feds and his interpretation of the “FTX is fine” tweet.

Day six of the trial of Sam Bankman-Fried saw the conclusion of former FTX chief technology officer Gary Wang’s testimony and the beginning of former Alameda Research CEO Caroline Ellison’s. Wang testified about his plea deal, among other things.

According to Inner City Press on X (formerly Twitter), Assistant United States Attorney Nicolas Roos asked Wang, “At your first meeting with the government, did you admit to committing crimes with the defendant?” Wang replied that he did.

“What were you told to do?” Roos asked.

“To tell the truth or not get a 5K letter, or worse,” Wang replied.

“5K letter” refers to a motion filed by the government under Section 5K1.1 of the U.S. Sentencing Guidelines, which is the policy statement on “substantial assistance to authorities.” It allows the government to make “the appropriate reduction” to a sentence considering various forms of cooperation.

U.S. Attorney for the Southern District of New York Damian Williams announced on Dec. 21, 2022, that charges were filed against Wang and Ellison “in connection with their roles in the fraud that contributed to FTX’s collapse.” The two had pleaded guilty to the charges and were cooperating with the government’s investigation.

Roos noted that Wang pleaded guilty to four charges, including conspiracy charges. “With who” did he conspire, Roos asked. “With Sam, [former FTX engineering director] Nishad [Singh] and Caroline,” Wang said.

Live tweeting of Ellison testimony will resume at 2 pm, here. Inner CIty Press is covering the case https://t.co/jsd2LKKf7U & https://t.co/cGS6liUb3n and fillings: https://t.co/Sm5clS6qXb Watch this feed - at 2 pm and beyond...
— Inner City Press (@innercitypress) October 10, 2023

According to another account of the trial, Wang said he met with government officials 18 times. The first two meetings were with agents of the Justice Department, the Federal Bureau of Investigation, the Securities and Exchange Commission and the Consumer Financial Protection Bureau, and he told them that Bankman-Fried’s Nov. 7 tweet, “FTX is fine. Assets are fine,” was true.

Wang testified that later he said that the tweet was true but misleading. It was not possible to liquidate the exchange’s FTT tokens, as a sale of that magnitude would cause the token’s price to fall, he said.

Earlier, Bankman-Fried’s defense attorney had asked Wang, “Do you know the difference between solvency and liquidity?” Wang responded that he did.

Magazine: Deposit risk: What do crypto exchanges really do with your money?

Latest update — Former FTX CEO Sam Bankman-Fried trial [Day 1]

October 3, 2023 Coin Telegraph

Coin Telegraph

The former FTX CEO faces seven counts of conspiracy and fraud. A New York court will decide his fate.

Cointelegraph reporters are on the ground in New York for the trial of former FTX CEO Sam Bankman-Fried. As the saga unfolds, check below for the latest updates.

Oct. 3: SBF trial begins

The trial of Sam Bankman-Fried began on Oct. 3 with jury selection. Bankman-Fried is charged with seven counts of conspiracy and fraud in connection with the collapse of FTX, the cryptocurrency exchange he co-founded. He has pleaded not guilty to all charges. The case is being heard by Judge Lewis Kaplan, who has presided over a long list of other high-profile cases, including ones involving detainees at Guantanamo Bay, the Gambino crime family, Prince Andrew and Donald Trump.

Bankman-Fried was ordered to be jailed on Aug. 11 after Kaplan found that his sharing of former Alameda Research CEO Caroline Ellison’s personal papers amounted to witness intimidation. Alameda Research was a trading house also founded by Bankman-Fried. Previously, he had been under house arrest in his parents’ home in Stanford, California, on a $250 million bond.

December: SBF arrested

Bankman-Fried was arrested in the United States on his arrival from the Bahamas on Dec. 21, 2022. He had been arrested in the Bahamas on Dec. 12 after the U.S. government formally notified that country of charges the U.S. was filing against him. He declared his intention to fight extradition from the Caribbean nation but changed his mind after a week in Bahaman jail and consented to extradition.

Meanwhile, FTX co-founder Gary Wang and Alameda Research CEO (and reportedly sometime SBF girlfriend) Ellison agreed to plead guilty in the burgeoning case.

November: FTX collapses

Bankman-Fried’s troubles began when reports emerged on Nov. 2 that Alameda Research had a large holding of FTT, the FTX utility token. That revelation led to questions about the relationship between the two entities. On Nov. 6, Changpeng Zhao, CEO of rival exchange Binance, announced that his exchange would liquidate its FTT holdings, which were estimated to be worth $2.1 billion. Zhao turned down an offer tweeted by Ellison to buy Binance’s FTT.

A run began on FTX. Bankman-Fried gave reassurances on Twitter (now X) that the exchange’s “assets are fine” and accused "a competitor" of spreading rumors. By Nov. 8, the price of FTT had fallen from $22 to $15.40.

It’s only been one week since SBF’s notorious “FTX is fine. Assets are fine.” pic.twitter.com/zKoILqquHF
— Robert Smith (@BondHack) November 14, 2022

Also on Nov. 8, Bankman-Fried announced on Twitter that he had come to an agreement with Zhang “on a strategic transaction.” He wrote, “Our teams are working on clearing out the withdrawal backlog as is. This will clear out liquidity crunches; all assets will be covered 1:1.”

On Nov. 9, Zhang announced that Binance would not pursue the acquisition of FTX after due diligence and more reports of mishandled funds. The price of Bitcoin (BTC) plummeted to $15,600. The FTX and Alameda Research websites went dark for a few hours. When the FTX website came back, it bore a warning against making deposits and was unable to process withdrawals.

On Nov. 10, Bankman-Fried posted a 22-part Twitter thread that began with “I’m sorry.” It was the first of a long string of public statements he made about the exchange’s fall. The following day, the entire staff of Alameda Research quit, and FTX, FTX US and Alameda Research filed for bankruptcy in the United States. Bankman-Fried resigned as FTX CEO and was replaced by John J. Ray III. Ray was best known for his role in the Enron bankruptcy.

SBF and FTX before the fall

At the beginning of 2022, FTX had a $32 billion valuation and was thought to be in enviable financial condition. Bankman-Fried was seen as a respected business leader by much of the crypto community and the world at large. He was photographed with political leaders and spoke in Congressional hearings.

Maxine Waters is chairing the investigation into FTX https://t.co/oFMctH4rRh pic.twitter.com/Ox6O5w4nOl
— Jordan Schachtel @ dossier.today (@JordanSchachtel) November 17, 2022

He had gained a reputation as a philanthropist, pursuing a philosophy popular among academics known as effective altruism. Part of his implementation of that philosophy was political activism in the form of financial support for candidates.

As the crypto winter set in, Bankman-Fried spoke of FTX and Alameda Research’s “responsibility to seriously consider stepping in, even if it is at a loss to ourselves, to stem contagion.” The companies made a bid for Voyager Digital that was rebuffed.

FTX made a deal with Visa to introduce its own debit card in 40 countries.

Bankman-Fried, Ellison and other alumni of Jane Street Capital founded Alameda Research in 2017. Bankman-Fried went on to found FTX with Wang in 2019. Zhao was an early investor in the exchange.

This is a developing story, and further information will be added as it becomes available.

Class-action suit filed against Binance for alleged harm to FTX before its collapse

October 2, 2023 Coin Telegraph

Banks

A California resident is suing Binance and its CEO for tweets last November that, according to allegations, led to the collapse of the rival exchange.

A class-action suit was filed against Binance.US and Binance CEO Changpeng Zhao on Oct. 2 in the District Court of Northern California alleging various violations of federal and California law on unfair competition for attempting to monopolize the cryptocurrency market by harming its competitor FTX. The suit was brought by Nir Lahav, who is identified only as a California resident.

At issue are posts made by Zhao on Twitter (now X) in early November on the eve of FTX’s collapse. The posts were made in conjunction with the decision by the defendants to liquidate their holdings in the FTX utility token FTT on Nov. 6. The plaintiffs estimated that Binance owned up to 5% of all FTT tokens.

*Suit filed against Binance and Changpeng Zhao. Source: CourtListener*

The following day, Zhao stated in a Twitter post that Binance had signed a letter of intent to acquire FTX, but it backed out of that deal one day later. According to the suit:

“Zhao publicly disseminated this information [on the withdrawal of the acquisition offer] on twitter and other social media platforms to hurt FTX Entities that ultimately lead to a rushed and unprecedented collapse of FTX Entities.”

After began its argumentation with a defense of the Securities and Exchange Commission’s (SEC) policies on crypto and invocation of the Supreme Court’s Howey and Reves decisions, among others.

As part of Binance’s exit from FTX equity last year, Binance received roughly $2.1 billion USD equivalent in cash (BUSD and FTT). Due to recent revelations that have came to light, we have decided to liquidate any remaining FTT on our books. 1/4
— CZ Binance (@cz_binance) November 6, 2022

It went on to claim that Zhao’s Nov. 6 tweet, “Due to recent revelations that have came [sic] to light, we have decided to liquidate any remaining FTT on our books,” was false and misleading, since Binance has already sold its FTT holdings, and the post was “intended to cause the price of FTT in the market to decline.”

The plaintiffs found evidence for their claim in the same post by Zhao, where he wrote, “We are not against anyone. […] But we won’t support people who lobby against other industry players behind their backs.” The plaintiffs took the latter sentence to indicate that Binance opposed FTX CEO Sam Bankman-Fried’s “regulatory efforts.”

Sad day. Tried, but
— CZ Binance (@cz_binance) November 9, 2022

The suit alleges that Zhao’s proposal to acquire FTX was not made in good faith and the episode would “ultimately lead” to the collapse of FTX:

“Zhao’s tweet resulted in FTT price declining from US 23.1510 to US 3.1468. This significant drop plummeted FTX Entities into bankruptcy without giving an opportunity or chance to FTX Entities’ executives and board of directors a chance [sic] to salvage the situation and put in safe guards to protect its clients and end-users.”

The suit demanded monetary damages, court costs and disgorgement of ill-gotten gains based on seven counts. “Plaintiff believes that there are thousands of members of the proposed class,” the suit stated.

CZ just executed the most gangster play we've seen in Crypto, ever, period. The BALLS on this man. Truly -- bravo.

Also bravo to Sam to choose the correct option that protects customer assets, swallow his pride, and not burn everything down in an unnecessary fight.

WHAT A SHOW!
— Autism Capital (@AutismCapital) November 8, 2022

As the suit noted, both Binance and FTX are currently subject to SEC actions. The criminal case against Bankman-Fried will begin Oct. 4 in New York. Zhao addressed potential accusations of unfair competition in the same tweet that is cited in the suit. “Regarding any speculation as to whether this is a move against a competitor, it is not,” he wrote.

His statement did not stop speculation to that effect within the crypto community, however. The CEOs of the crypto exchanges traded jibes on then-Twitter for weeks afterward.

Magazine: FTX bankruptcy filing details, Binance’s crypto industry fund and a U.S. CBDC pilot: Hodler’s Digest, Nov. 13-19

Sam Bankman-Fried FTX trial — five things you need to know

October 2, 2023 Coin Telegraph

Coin Telegraph

The long awaited trial of former FTX CEO Sam Bankman-Fried gets underway on Oct. 4 - here’s what you need to know.

Sam Bankman-Fried will face his first day in court over a litany of charges less than a year after the calamitous collapse of cryptocurrency exchange FTX.

The former CEO of the bankrupt exchange is set to face 21 days in court during his criminal trial scheduled from Oct. 4 to Nov. 9. Bankman-Fried has been in pre-trial detention at the Metropolitan Detention Center since Aug. 11 and has filed several unsuccessful motions seeking his release to prepare for his trial.

United States District Judge Lewis Kaplan denied the former FTX CEO’s latest motion for release, citing concerns that Bankman-Fried was a flight risk given the severity of charges being faced and the potential length of time he could spend behind bars if convicted. The former FTX CEO has been granted permission to meet with his legal team at 7 am on active court days.

Proceedings will begin with jury selection on Oct. 3 before the trial itself gets underway on Wednesday, Oct. 4. Cointelegraph has highlighted five major talking points ahead of one of the biggest cryptocurrency-related trials in history.

What happened to FTX?

Once hailed as the darling of the cryptocurrency industry, FTX was co-founded in 2019 by Bankman-Fried and Gary Wang and went on to become a household name in the United States due to its high-profile sponsorships and campaigns.

Over the next three years, the company carried out a series of fundraising rounds that included a preliminary $900 million raise in July 2021 and another $420 million raise in October 2021. 2022 promised to be fruitful for the exchange as it kicked off the year with a further $400 million fundraising round headed up by the likes of SoftBank and Temasek, valuing the company at an estimated $32 billion.

FTX signed several major sponsorship deals during those two years. These included Mercedes’ Formula 1 team, as well as a reported $135 million deal for the naming rights of the Miami Heat’s NBA arena.

The company appeared to be in sound standing as the wider cryptocurrency ecosystem wavered after the implosion of the Terra/LUNA stablecoin. Several high-profile cryptocurrency lending firms were caught in the fallout, which led to FTX making a $240 million offer to acquire BlockFi as well as a failed bid to bailout Voyager Digital.

Things began to unravel in November 2022, with rumblings of trouble at FTX related to its relationship with Bankman-Fried’s quantitative trading firm Alameda Research and the latter’s dependence on FTX’s native exchange token FTT.

1) Hi all:

Today, I filed FTX, FTX US, and Alameda for voluntary Chapter 11 proceedings in the US.
— SBF (@SBF_FTX) November 11, 2022

The house of cards came crumbling down as Binance CEO Changpeng ‘CZ’ Zhao announced that the exchange would sell its FTT token holdings, which played a role as a catalyst for the liquidity crisis at FTX as the value of FTT plummeted.

Liquidating our FTT is just post-exit risk management, learning from LUNA. We gave support before, but we won't pretend to make love after divorce. We are not against anyone. But we won't support people who lobby against other industry players behind their backs. Onwards.
— CZ Binance (@cz_binance) November 6, 2022

On Nov. 11 2022, FTX, FTX US and Alameda Research began bankruptcy proceedings, with Bankman-Fried resigning as CEO. John Ray III, the man who handled the infamous Enron bankruptcy, was appointed as acting CEO to review and monetize remaining assets of the FTX group.

Seven counts

Bankman-Fried stands accused of seven counts of conspiracy and fraud relating to the collapse of the exchange.

The U.S. Justice Department had originally announced an eight-count Indictment with fraud, money laundering, and campaign finance offenses in December 2022. This included two counts of wire fraud conspiracy, two counts of wire fraud, and one count of conspiracy to commit money laundering.

An excerpt from the Justice Department's indictment of Sam Bankman-Fried on Dec. 13, 2022.

Bankman-Fried was also charged with conspiracy to commit commodities fraud, conspiracy to commit securities fraud, and conspiracy to defraud the United States and commit campaign finance violations.

The latter campaign contributions charge was subsequently dropped by the Justice Department in July 2023, due to an extradition agreement with The Bahamas from whence Bankman-Fried had been deported.

Who will testify?

The Justice Department informed presiding Judge Kaplan that it would call up several witnesses for the trial, including former FTX clients, investors and staff.

The U.S attorneys noted that they expected FTX customers who had deposited funds on the defunct exchange to testify regarding their expectations and understanding of the exchange’s deposit policy and the ability to withdraw funds at any time.

Investors that purchased shares in FTX are expected to testify about their expectations of the company being a custodian of user funds as well as the full scope of custodianship in regard to cryptocurrency exchanges.

Lastly, the Justice Department expects cooperating witnesses, who pled guilty to participating in a conspiracy to commit fraud alongside Bankman-Fried, to testify about their interactions with the former CEO, as well as about statements and actions he carried out in the months leading up to the bankruptcy.

Among the cooperating witnesses expected to appear are Wang, FTX engineering director Nishad Singh and Bankman-Friend's ex-girlfriend and former Alameda Research CEO, Caroline Ellison.

How long could SBF be in jail?

According to the Justice Department, Bankman-Fried’s alleged crimes carry significant prison time.

The counts of wire fraud conspiracy, wire fraud, and money laundering all carry a maximum sentence of 20 years. Meanwhile, charges of conspiracy to commit commodities fraud, conspiracy to commit securities fraud and conspiracy to defraud the United States carry five-year maximum sentences.

According to CNN, the 30-year-old could face over 100 years in prison if he is found guilty of a multitude of charges brought against him by the U.S. government.

Biggest fraud case in U.S. history?

Legal experts have already suggested that Bankman-Fried’s trial could signify one of the most significant fraud cases in U.S. history. $8.9 billion of customer deposits and investor funds went missing in the wake of FTX’s collapse, while an estimated $7.3 billion of liquid assets have since been recovered through bankruptcy proceedings.

Bernie Madoff arguably remains the most enigmatic fraud case in America, as the recent rendition of his $19 billion Ponzi scheme in a Netflix documentary highlights the grand scale of his influence and shadowy scheme.

While Bankman-Fried may not have caused as significant a level of financial harm as Madoff, his own image and that of FTX’s brand as a visibly active cryptocurrency proponent has thrust the story into the spotlight as a modern-day parallel of the late Madoff’s 17-year fraud.

Bankman-Fried also became involved in the U.S. political landscape, donating over $40 million to democratic committees and candidates in 2022. The former FTX CEO reportedly even considered paying Donald Trump $5 billion to not run for president in the United States, according to author Michael Lewis's upcoming biography.

Bankman-Fried maintains his innocence, having pleaded not guilty to all charges brought against him in Aug. 2023.

Magazine: Blockchain detectives: Mt. Gox collapse saw birth of Chainalysis

FTX Japan allows total withdrawal of funds — users rejoice the ‘escape’

February 26, 2023 Coin Telegraph

Coin Telegraph

Numerous community members received their funds as FTX investors in other countries remain hopeful of a similar outcome.

While FTX customers across the world patiently await Sam Bankman-Fried’s (SBF) legal conclusion in hopes of getting back their investments, users of FTX Japan have started withdrawing all of their funds.

On Nov. 7, 2022, crypto exchange FTX and its subsidiaries halted all funds withdrawal after SBF was accused of misappropriating users’ funds. The domino effect forced Liquid Group — a Japanese crypto trading platform owned by FTX since February 2022 — to halt withdrawals on Nov. 15, 2022.

However, to some investors’ delight, FTX Japan resumed withdraws on Feb. 21 — which involved moving funds from the defunct exchange to a Liquid Japan account. Days later, a popular crypto trader from Japan @Whiskey_bonbon_ confirmed to have successfully withdrawn all of their funds.

全て出金完了！

最初は正直諦めていたと言えば諦めていた気持ちもあった
FTXJPの中の方々も本当に寝耳に水だった部分を知っているので、尽力には感謝申し上げたい。
まだ出金されない方も辛抱強く頑張ってほしい pic.twitter.com/34v7MFznLC
— Hibiki＠Trader (@Whiskey_bonbon_) February 25, 2023

A rough translation of the above tweet reads:

“All payments completed! To be honest, at first, I felt like I had given up. I would like to express my gratitude to the people in FTXJP for their efforts, as they know the part that was really overlooked.”

Just a day after resuming funds withdrawals, FTX Japan revealed that roughly $50 million (6.6 billion yen) was taken out from Liquid Global.

While a community member responded to the development by saying, “Congratulations on your escape! ! !” many are yet to witness a total redemption of their funds. The reimbursement process is expected to come with delays due to the sheer number of users impacted by the FTX-SBF fiasco.

Numerous community members have confirmed that all their money has been paid out. However, the FTX investors watching from the rest of the world remain hopeful of a similar outcome.

Piling up on the accusations against SBF, a federal judge ordered a superseding indictment unsealed containing 12 criminal counts.

A new superseding indictment against FTX cryptocurrency exchange founder Sam Bankman-Fried containing 12 charges was unsealed in Manhattan federal court https://t.co/MKmmgW7W01 pic.twitter.com/r9JVKNljDt
— Reuters Legal (@ReutersLegal) February 23, 2023

As Cointelegraph reported, U.S. Attorney Damian Williams accused Bankman-Fried of eight conspiracy charges related to fraud as well as four charges for wire fraud and securities fraud.

SBF’s criminal trial in federal court is scheduled to begin in October, while FTX’s bankruptcy case is ongoing in U.S. Bankruptcy Court for the District of Delaware.

Former FTX Executive Accused of Fueling a Charity Through Discounted FTT Purchase

February 15, 2023 Bitcoin.com

FTX profited from Sam Bankman-Fried’s inflated coins: Report

January 18, 2023 Coin Telegraph

Bankruptcy

Former FTX CEO allegedly used his popularity to lure developers, and Alameda Research to inflate the price of certain coins.

Sam Bankman-Fried (SBF), former CEO of the FTX crypto exchange, used his influence in the crypto industry to inflate some coins prices through a coordinated strategy with FTX's sister company, Alameda Research, a New York Times report claimed on Jan. 18.

As a way to keep FTX and the companies under its umbrella profitable, Bankman-Fried allegedly approached developers behind projects, insisting that they make their trading debuts on the exchange's platform. Following that, the report claimed that Alameda Research would buy some of these freshly listed coins to raise their value.

After attracting projects and using its hedge fund to prop up prices, Bankman-Fried allegedly relied on its popularity to advertise the projects, and persuade the crypto community to invest in those coins, known as 'Samcoins'. As a result of the strategy, Alameda appeared to be in a stronger position than it actually was.

The newspaper compared Bankman-Fried strategy with a large scale pump-and-dump scheme. A stock market operation refers to an increase in stock value by insiders in order to entice retail investors. The insiders then sell their shares, and other investors are left with worthless stock.

Pump-and-dump schemes are illegal, and are especially problematic when scammers use false or misleading statements to attract investors to micro and small-cap stocks.

For developers launching a new coin, Bankman-Fried's offer was an appealing option, as they could benefit from FTX recognition to advertise their tokens and get more attention from potential investors. Among the supposed "Samcoins" were Serum, Maps, Oxygen, Bonfida and Solana (SOL).

Sources interviewed by the NYT also noted that Bankman-Fried would offer a select group of investors the chance to buy in coins at low prices, warning that a second opportunity would only be available at higher amounts. Those interested in the offer are alleged to have signed up through an interna spreadsheet.

FTX's collapse kicked off on Nov. 2, after reports of a leaked balance sheet from Alameda suggested the company held a significant amount of FTT (FTT), the native token of FTX, among other coins facing liquidity issues. As a large trading firm holding such a large amount of one asset, Alameda's relationship with FTX raised questions in the crypto community, and ultimately led to a bank run on the exchange.

Oct. 3: SBF trial begins

December: SBF arrested

November: FTX collapses

SBF and FTX before the fall

What happened to FTX?

Seven counts

Who will testify?

How long could SBF be in jail?

Biggest fraud case in U.S. history?

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