Sam Bankman-Fried – the man behind now failed digital currency exchange FTX – has been arrested while stationed in the Bahamas and is being extradited to the United States, where he will face criminal charges after they were filed in a New York court.
Sam Bankman-Fried Is Heading to an American Jail
The criminal charges come by way of the Department of Justice (DOJ), though now the Securities and Exchange Commission (SEC) is filing its own civil suit against the disgraced crypto mogul. The agency says Sam Bankman-Fried orchestrated what it called “years-long fraud” in a statement, and they are using him to set an example to any other would-be crypto criminals that view the space as an area to commit crimes and take advantage of investors.
The SEC says Sam Bankman-Fried used the funds of others for “his own personal benefit and to help grow his crypto empire.”
Former U.S. prosecutor Renato Mariotti says Bankman-Fried has undoubtedly soured the crypto space permanently for some. In an interview, he commented:
From the DOJ’s perspective, SBF was spreading misinformation and was creating a lack of confidence in the regulators to police the market.
He further stated that there was a lot of concern that Bankman-Fried was somehow going to get away with everything he’d done given his ties to political authorities. It is estimated that he donated more than $40 million to various democrat politicians alone. He is also classified as the second largest donor to Joe Biden. Many have questioned democrats about whether they plan to give this money back and revoke their ties to the criminally charged crypto executive.
Mariotti says Biden and his cronies largely view the crypto space through a biased lens. They see the industry as unregulated and dangerous, and they will likely use this incident to their advantage and monitor activity with eagle eyes. He said:
The [Biden] administration believes that the digital asset space is unregulated and thinks that [crypto firms] can get away with anything.
A Real Damper in the Crypto Agenda
FTX will likely go down as one of the biggest embarrassments of the digital currency space. Beginning in the year 2019, FTX was only three years old, yet it somehow rose through the ranks and became one of the five largest crypto trading platforms in the world. Sam Bankman-Fried was lauded as a genius by many, and his net worth prior to the company’s collapse was estimated to be more than $16 billion.
However, it is alleged that Bankman-Fried utilized customer funds to purchase luxury condominiums for himself and assorted executives and employees of FTX in the Bahamas, the country where the exchange was based. The company was initially going to be bought out by Binance after it experienced a liquidity crunch, though this never came to be.