Ex-FTX CEO Sam Bankman-Fried will get to spend Christmas with his family, after a federal judge approved a historic $250 million bond at his first U.S. court appearance, according to a reporter live tweeting from the courtroom.
Following arguments by federal prosecutors and Bankman-Fried’s defense counsel, the disgraced crypto mogul was told by a judge that he would be allowed to await trial at his parents house in Palo Alto, California, according to court reporter Matthew Russell Lee of Inner City Press.
Judge Gorenstein: He will surrender his passport – it has already been surrendered. Home detention with local monitoring, to be installed today. He must live in his parents’ home in Palo Alto. No new business without pre-approval of Pre Trial Services
— Inner City Press (@innercitypress) December 22, 2022
Nicolas Roos, a New York-based prosecutor, told U.S. Magistrate Judge Gabriel Gorenstein that the government was proposing a bail package that included a $250 million bond, home detention, and location monitoring, according to the Inner City Press.
Roos described it as “the highest ever pre-trial bond,” and that the bond would be secured by the Palo Alto property.
The 30-year-old Bankman-Fried—also known as SBF—will not be able to spend more than $1,000 except on defense related costs, nor start other businesses, without court approval. He will also have to surrender his passport.
Bankman-Fried’s defense counsel said he agreed with these conditions.
“I’d like to emphasize, my client voluntarily consented to come face these charges—extradition can take months or years in the Bahamas,” Bankman-Fried’s attorney reportedly said. “His parents are Stanford professors. We ask that you accept release.”
“The defendant has achieved sufficient notoriety it would be impossible for him to continue financial transactions,” Gorenstein said, according to Lee. “This notoriety also goes to risk of flight—he would be recognized—so I am going to permit release.”
U.S. prosecutors hit Bankman-Fried with eight criminal charges related to the November collapse of his digital asset exchange, including conspiracy to commit wire fraud on customers and conspiracy to defraud the United States and violate the campaign finance laws.
The Complex Frauds and Cybercrime Unit at the Southern District of New York US Attorney’s Office is handling the case.
Bankman-Fried was arrested last week in the Bahamas, where FTX is based, and spent time in a jail there before being extradited and arriving in the U.S. yesterday.
FTX spectacularly collapsed last month in by far the most dramatic fall in the cryptocurrency industry’s 13-year history—and one of the 2022’s biggest stories.
The company let customers buy, sell, and store numerous digital assets, as well as place bets on the future prices of crypto through derivative products, and was one of the most popular exchanges in the world.
But it crashed after it became apparent that the company did not have sufficient funds to back customers’ assets.
This was because trading house Alameda Research—also founded by Bankman-Fried—had the ability to use FTX customer assets for its own means, and without oversight, according to newly appointed FTX CEO John J Ray III.
SBF was famous, courted politicians and donated millions to both political parties. He was not only one the richest men in crypto but one of the wealthiest people on the planet—and claimed he gave all his riches away to good causes.
Ray, an insolvency professional in charge of reorganizing the company’s finances, said FTX’s collapse was caused by “a very small group of grossly inexperienced and unsophisticated individuals.”