Bitrabo Editorial
The downfall of the crypto exchange FTX takes a surprising twist as fresh evidence indicates that the founder, Sam Bankman-Fried (SBF), may not have been acting alone.
Emails obtained by the Wall Street Journal reveal a $100 million political donation scheme allegedly orchestrated by SBF and his entire family, raising concerns about potential campaign finance violations and the misappropriation of customer funds.
The Involvement of SBF’s Family in the Scandalous Scheme
At the center of the allegations is Joe Bankman, SBF’s father and a law professor at Stanford. Emails suggest his participation in planning the scheme, which authorities view as an illicit straw-donor initiative.
Straw-donor schemes involve the use of others’ funds for political donations to bypass contribution limits or conceal the funding source. Despite Joe Bankman denying any knowledge of campaign finance violations, the emails portray a different narrative, potentially exposing him to legal consequences.
Barbara Fried, SBF’s mother and co-founder of the PAC Mind the Gap, is also implicated in directing funds towards progressive causes, possibly utilizing FTX customer funds for personal political agendas.
SBF’s brother, Gabriel Bankman-Fried, is accused of channeling donations towards pandemic prevention efforts, allegedly dipping into FTX funds for personal use.
The coordinated effort by the family aimed to influence the 2022 election cycle, as indicated by David Mason, a former chairman of the Federal Election Commission, who found the evidence in the emails compelling.
Former FTX Executives Entangled in the Fallout
Aside from the Bankman-Fried family, former FTX executives, already facing repercussions from the exchange’s collapse, are now linked to the donation scandal. Ryan Salame, co-CEO of FTX Digital Markets, received a 7.5-year prison term for various charges, including campaign finance fraud.
The length of Salame’s sentence, surpassing the prosecutors’ request of seven years, could signal a tougher stance on individuals involved in FTX’s financial troubles. Other ex-FTX executives like Caroline Ellison and Nishad Singh have pleaded guilty and await their sentencing.
A Stained Legacy: SBF’s Transformation from Crypto Innovator to Alleged Wrongdoer
The FTX saga unfolds further with the revelation of the political donation scheme, adding complexity and suspicions of criminal activity. While SBF is serving a lengthy sentence for his role in FTX’s downfall, his family now faces potential legal consequences, tarnishing the once-heralded image of a crypto visionary.
This turn of events portrays a family willing to compromise ethical boundaries for personal gains, contrasting sharply with the earlier image of SBF as an industry visionary.
Featured image from Getty Images, chart from TradingView