As Sam Bankman-trial Fried, the founder of FTX and a former cryptocurrency star, started last month, headlines announced that cryptocurrency was also on trial.
Nevertheless, Bitcoin was trading at its highest level in a year when Bankman-Fried was found guilty on seven counts of wire fraud and money-laundering conspiracy on Thursday evening, following less than five hours of jury deliberations.
As the proceedings in the courtroom unfolded, it became evident that the cryptocurrency bro himself—both Bankman-Fried and the archetype of the tech dilettante who thinks he’s such an all-around genius that he can get rich with no expertise and an untidy head of Einstein hair—was the real subject of trial rather than the cryptocurrency itself.
Bankman-Fried acknowledged during his three days on the stand that he had no prior knowledge of cryptocurrencies. Nor did he have any knowledge of financial regulation. He stated that he thought the terms of service of FTX permitted Alameda Research, a closely related hedge fund, to use FTX customer funds in the manner that it did—actions that the jury and prosecutors deemed fraudulent. When asked what knowledge he had of cryptocurrencies prior to joining FTX, he said, he had no idea how they worked at all. All he knew was that they were exchangeable items.
The prosecution questioned Bankman-Fried extensively regarding his public persona, even though portions of the trial explored the technical and financial details of FTX’s grand scam. The goal of Danielle Sassoon, the assistant US attorney, was to expose the boy genius’s dishevelled appearance and show the jury that he misled investors and customers into believing they were in good hands.
His likeness was successfully dissected by the prosecution. Maybe the messy Mark Zuckerberg school of style has become boring to us. The verdict might be interpreted as follows: wearing a hoodie instead of a suit jacket does not indicate that you are an amateur or that you are solely focused on your product. It was acknowledged by Bankman-Fried during the trial.
Is the industry as a whole or just him going to be found guilty in the wake of his conviction?
The technological and legal management of cryptocurrencies or blockchain technology as Bankman-Fried’s means to an end was not a major topic of discussion during the trial. Rather, the main concern was whether the former mogul embezzled and stole money from his clients for his own extravagant purposes. Although the crime is as old as banking itself, new, unregulated technology is being used to commit it.
Sam Bankman-Fried committed one of the largest financial frauds in American history, a multibillion-dollar scheme intended to make him the king of cryptocurrency, according to Damian Williams, the prosecutor in charge of the southern district of New York. However, corruption of this kind is not new, even though the cryptocurrency industry and individuals like Bankman-Fried may be relatively new.
A closer look at Bitcoin today reveals the precarious situation the cryptocurrency finds itself in. The image of cryptocurrency backers has never been worse due to Bankman-Fried. There are indications, however, that Bitcoin will survive: With the anticipated approval of exchange-traded funds, which include it, the original cryptocurrency is about to score a significant regulatory win.
Additionally, industry insiders disagree that the former boy wonder is the embodiment of cryptocurrencies. They believe they are different from him. They could be right; the demise of cryptocurrency is not due to Bankman-Fried. Since January of this year, bitcoin has increased in value by 110%, so it is definitely valuable.
Bitcoin is likely here to stay, if not as the game-changing technology some had hoped for, then at least as a safe haven for money given its value despite some infamous champions like FTX, the Mt Gox exchange, and the always unwelcome Winklevoss twins. The true blockchain believers will keep driving up the value of Bitcoin, no matter how long we trade it for. We could trade it for as long as we trade stocks. The symbol of libertarian rebellion against the financial system is probably not going to go away.
The trial has only served to divert attention away from the excellent work for true believers. The Crypto World Is Already Bored of SBF’s Trial, Said Wired. Bankman-Fried has irreversibly, irreparably, irresponsibly, and irredeemably tarnished this technology’s reputation in the eyes of those who do not share their viewpoint. The SBF trial serves as a reminder that the cryptocurrency industry is flawed, according to the report. Many would likely take their chances with a game of chance in Las Vegas before investing in cryptocurrency following the collapse of FTX.
One long-lasting effect of Bankman-Fried’s demise was the start of the US’s crypto crackdown era. In addition to the Securities and Exchange Commission accusing Coinbase of functioning as an unregistered securities exchange, broker, and clearing agency, the Commodities Futures Trading Commission has filed a lawsuit against Binance, the largest cryptocurrency exchange in the world. Both businesses reject any misconduct.
Had Bankman-Fried been declared not guilty, If the jury had found him not guilty, it would have been a stunning demonstration of their faith in cryptocurrency.
Perhaps Bankman-Fried found an unregulated industry that was easier to take advantage of. The one that could be found was crypto.
