Mon. Feb 26th, 2024

The latest news on the cryptocurrency exchange FTX include Sam Bankman-Fried, the disgraced founder of the exchange, who is doing himself a disservice with his statements. Furthermore, it seems that FTX Japan has allowed full withdrawal of funds and users have rejoiced at this “escape”, let’s see why.

Sam Bankman-Fried: Latest news on the founder of FTX

Despite being accused of orchestrating one of the biggest financial frauds in history and facing the prospect of life in prison, SBF has been tweeting and giving interviews to the media, all in an effort to defend himself in court against the public opinion. It’s an unusual strategy for a high-profile criminal defendant who oversaw cryptocurrency firm FTX, which lost billions of dollars belonging to clients. In fact, it has surprised lawyers not involved in the case, as every Bankman-Fried quote and tweet is effectively a gift to prosecutors, who can use that material to build your case against you.

Rebecca Mermelsteina partner at the O’Melveny Law Firm, said:

“I think any white-collar lawyer you could ask would say, ‘Shut up: keep your mouth shut and let us talk.'”

Additionally, through a spokesperson, Bankman-Fried declined NPR’s interview request. The communications trail, including eight tweets, a newsletter stack and a handful of lengthy media interviews that Bankman-Fried left behind are already coming back to haunt him. For example, a few weeks before Bankman-Fried’s arrest, cryptocurrency blogger Tiffany Fong she interviewed him by phone and the conversation turned to Bankman-Fried’s campaign contributions. According to reports, he donated around $40 million during the 2022 midterms. During that interview, Bankman-Fried admitted to Fong that he was sending money to candidates in a way that was difficult to trace:

“All my Republican donations were obscure. And the reason was not for regulatory reasons. It’s because reporters freak out if you donate to a Republican. Everyone is super liberal and I didn’t want to argue.”

SBF and the evidence of illegal political contributions: what does it mean?

Those comments to Fong turned out to be reckless. In fact, Bankman-Fried was subsequently accused of eight criminal charges, including wire fraud and conspiracy to make illegal political contributions. So on Thursday, when federal prosecutors unsealed four additional criminal charges against Bankman-Fried, they included new details about expanding their case against him. In the latest indictment, prosecutors specifically cited comments from that interview as part of their additional evidence for their charge of “illegal political contributions”. In any case, that may not be all. The lawyers caution that prosecutors could use more of the comments he made during his trial, which is scheduled to begin in October. In any case, it’s not just the interviews that have Bankman-Fried in trouble. The founder of crypto exchange FTX has also contacted current FTX employees, and that could have further consequences. Prosecutors say Bankman-Fried used an encrypted messaging app on January 15 to communicate with the general counsel for FTX’s US subsidiary and wrote the following:

“I would really like to reconnect and see if there is a way for us to have a constructive relationship, use each other as resources when possible, or at least check things out with each other. I’d like to make a phone call sometime and chat.”

After that message came to light, the judge supervising the trial imposed new restrictions on Bankman-Fried bailbarring him from sending encrypted messages and others that disappear after being read, and barring Bankman-Fried from contacting current and former FTX employees.

FTX Japan allows full withdrawal of funds

As FTX clients around the world patiently await the conclusion of the dispute between FTX and Sam Bankman-Fried, FTX Japan users have started withdrawing all their funds. To the delight of some investors, FTX Japan resumed withdrawals on February 21, resulting in funds being transferred from the defunct exchange to a Liquid Japan. Days later, a famous Japanese cryptocurrency trader, Hibiki Trader, confirmed that he had successfully withdrawn all his funds. The day after withdrawals resumed, FTX Japan revealed that users had withdrawn around 6.6 billion yen ($50 million). While a community member responded by saying, “Congratulations on your escape!” Many have yet to see a full redemption of their funds. The redemption process is expected to be delayed due to the large number of users affected by the collapse of the FTX cryptocurrency exchange. Several members of the community have confirmed that all their money has been paid. However, FTX investors watching from the rest of the world remain hopeful of a similar outcome. Following the charges against SBF, a federal judge ordered the opening of a superseding indictment containing 12 criminal charges. federal prosecutor damian williams charged Bankman-Fried with eight counts of fraud-related conspiracy and four counts of securities and wire fraud. As anticipated, the SBF criminal trial is scheduled to begin in October, while the FTX bankruptcy proceedings is in progress.

Some Observations on FTX and Sam Bankman-Fried

Although Bankman-Fried has not commented publicly since January 19, lawyers who have dealt with prominent white-collar defendants warn that it can be challenging to keep them quiet for long, especially if they are used to living in the center of attention. This is a potential problem for Bankman-Fried, who had relationships with the likes of the former president Clinton and former quarterback Tom Brady at the height of his popularity. In his public statements, the former FTX CEO tried to defend himself by saying that he did not intend to cause losses to FTX clients and by stating, most importantly, that he was not a villain. For example, a few days before Bankman-Fried was arrested in the Bahamas, ABC News anchor, George Stephanopoulosasked him if he thought it was fair for people to compare him to Bernie Madoff, one of the world’s most infamous con artists. Bankman-Fried replied:

“I don’t think that’s what they are at all. But I understand why they say that. People have lost money, they have lost a lot of money.”

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By Farwa Raza

Farwa Raza is a writer who specializes in news articles. She has been writing on wttspod.com for over one years, and during that time she has written over 100+ articles on various topics ranging from politics to entertainment. Her goal as an author is to provide readers with the latest news stories while also providing her own opinion on them.