Sam Bankman-Fried, the founder of FTX, appears in court in New York to face fraud and money laundering charges. The spotlight of the entire cryptocurrency industry is on his trial, which feels judged by the proceedings and is rooting against the 31-year-old, who in their opinion is guilty of having dealt a serious blow to the sector.
«He can testify if he wants, even if his lawyers advise against it. Just raise your hand,” said Judge Lewis Kaplan, addressing Bankman-Fried at the start of work in court, where lawyers for the two sides are busy choosing the 12 jurors who will decide the outcome of the long-awaited proceedings.
There are seven charges brought against Bankman-Fried and, if convicted, he faces up to 100 years in prison. The trial marks a new page in the parable of the founder of Ftx, who only a little over a year ago was considered a star to be honored and to whom one could ask for advice in regulating the Wild West of cryptocurrencies. Bankman-Fried now represents the villain, a character so controversial that not even the famous author Michael Lewis manages to redeem in his book “Going Infinite”, in which he narrates his initial infatuation with the young crypto-genius which later turned into a tragic story with the emergence of Mr Ftx’s true personality.
For Bankman-Fried the battle in court is for freedom, but the road ahead is all uphill. Many of those who were accused along with him, from his ex-girlfriend to his closest collaborators, have already pleaded guilty and said they were willing to testify in court with their former boss. Prosecutors can then rely on thousands of pages of communications and bank statements to show what they say was a multibillion-dollar fraud that incinerated at least $8 billion in customer deposits. The crypto industry is following the developments, convinced that Bankman-Fried must pay for what he has done, given that – this is the underlying thesis – his actions have damaged the sector.
Cryptocurrencies and the surrounding universe already do not enjoy an excellent reputation and the collapse of Ftx has contributed to fueling doubts and shadows about the sector, making it difficult to raise funds and creating a climate of mistrust.
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