Sam Bankman-Fried Goes on Trial Tomorrow

Crypto's biggest trial begins tomorrow. Its outcome may hinge on Sam Bankman-Fried's former colleagues.

AccessTimeIconOct 2, 2023 at 10:00 a.m. UTC
Updated Oct 2, 2023 at 3:11 p.m. UTC

It is officially trial week, everyone – or as Bloomberg’s Joe Weisenthal would likely put it, “this is why we get up in the morning.” It’s been exactly nine months and 20 days since Sam Bankman-Fried got arrested at his then-home in the Bahamas. Today marks the last day before he is set to start the trial in which he will win back his freedom – or be locked up for what a federal judge says could be a “very long” time.

You're reading The SBF Trial, a CoinDesk newsletter bringing you daily insights from inside the courtroom where Sam Bankman-Fried will try to stay out of prison. Want to receive it directly? Sign up here.

Thousands of pages of evidence, ranging from internal documents to audio recordings, will be presented and fought over in the next six weeks as U.S. prosecutors try to prove that the former FTX founder knowingly defrauded customers and business partners.

Arguably the most damning evidence – or lack thereof – could come from the recollections and personal opinions of Bankman-Fried’s former colleagues, friends and housemates.

Caroline Ellison, Nishad Singh and Gary Wang were close friends and roommates of Bankman-Fried as much as they were colleagues. Ellison was emotionally invested with the FTX founder and troubled by the former couple’s on-and-off relationship, which according to a diary entry from her, slowly fizzled out in February 2022.

Prosecutors also say they intend to call up FTX customers and investors, including non-U.S. customers, over the course of the trial.

On another note, do you remember when FTX suddenly announced it was hacked and lost some $600 million worth of crypto? This was the same day it filed for bankruptcy last November. A decent portion of those funds sat in a wallet for a few months – and then started moving this weekend. Around 15,000 ether (worth around $26 million at Sunday night’s prices) moved out of a wallet through various routers and privacy tools between Friday night and Sunday morning.

We never got an explanation for what, exactly, happened and how the exploit was carried out. I imagine federal investigators are probably closely tracking this episode, however.

On a logistics note, Judge Lewis Kaplan ruled in favor of the DOJ’s motion to prevent Bankman-Fried from getting into the weeds on what his lawyers may or may not have said about FTX’s operations in his opening statement. However, Bankman-Fried’s defense team can still raise the “advice-of-counsel” defense later on, with notice to the court and DOJ.

In court filings, the defense said the argument would be that FTX’s in-house and external lawyers were part of decisions to use auto-deleting messaging platforms, set up legal entities in the U.S., loan funds to FTX and Alameda executives and other aspects of the FTX/Alameda relationship.

Reminder: We’re at the courthouse bright and early tomorrow. Voir dire starts at 9:30 a.m. ET.

Edited by Nikhilesh De.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Helene Braun

Helene is a New York-based reporter covering Wall Street, the rise of the spot bitcoin ETFs and crypto exchanges. She is also the co-host of CoinDesk's Markets Daily show. Helene is a graduate of New York University's business and economic reporting program and has appeared on CBS News, YahooFinance and Nasdaq TradeTalks. She holds BTC and ETH.

Nikhilesh De

Nikhilesh De is CoinDesk's managing editor for global policy and regulation. He owns marginal amounts of bitcoin and ether.