SBF will stay two months in jail in the Bahamas

SBF in Jail

Judge Ferguson-Pratt denied SBF’s request to be released on bail and remanded Bankman-Fried to jail in the Bahamas until February 8, 2023.

During the first week of November, FTX co-founder Sam Bankman-Fried (SBF)’s world was turned upside down. It all started when Coindesk published an exposé on SBF’s Alameda Research quant trading firm and the huge balance of FTT tokens the firm held. Following the report, FTX and Alameda came under the spotlight and Binance delegate Changpeng Zhao (CZ) revealed that his exchange would dump all of his FTT tokens.

These two events fueled speculation that FTX and Alameda were insolvent and on November 8, 2022, Binance said it would buy FTX after doing due diligence on the company’s financials. However, the deal never came to fruition, and at 4:00 pm (ET) on November 9, 2022, the world’s largest crypto-asset exchange by trading volume announced that it would pull out of the purchase of FTX.

At the time, all of the digital assets in FTX’s coffers were either withdrawn by clients (many of whom were Bahamian natives) or simply disappeared. Two days after Binance backed out of the deal, SBF announced that FTX and Alameda had filed for Chapter 11 bankruptcy protection, along with some 130 associated companies.

SBF also revealed that he had resigned from his role as CEO of FTX and John J. Ray III took over to deal with the bankruptcy and restructuring process. Since the bankruptcy filing, SBF has embarked on a media tour in which it conducted a large number of interviews, while numerous media outlets covered a significant amount of worrying evidence.

Prior to SBF’s arrest in the Bahamas, a report published by the Australian Financial Review (AFR) detailed that FTX’s SBF and his inner circle used a secret chat group called “Wirefraud”. AFR’s US correspondent, Matthew Cranston, stated that “[AFR] has [learned] that FTX founders Sam Bankman-Fried and Zixiao ‘Gary’ Wang, along with FTX engineer Nishad Singh and former director Alameda Research executive Caroline Ellison used a chat group on Signal in the hope that the information would remain hidden.”

24 after the publication of the AFR report, Bankman-Fried was arrested. The FTX co-founder was also indicted by a federal grand jury in Manhattan, and charged with eight counts of financial fraud by Southern District of New York (SDNY) Attorney Damian Williams. SBF was also charged by the US Securities and Exchange Commission (SEC) and sued by the Commodity Futures Trading Commission (CFTC).

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