{"id":40911,"date":"2023-11-03T00:05:09","date_gmt":"2023-11-03T00:05:09","guid":{"rendered":"https:\/\/prosfunds.com\/markets\/crypto\/as-the-jury-deliberates-in-sbf-trial-what-happens-next-as-the-jury-deliberates-in-sbf-trial-what-happens-next\/"},"modified":"2023-11-03T00:05:13","modified_gmt":"2023-11-03T00:05:13","slug":"as-the-jury-deliberates-in-sbf-trial-what-happens-next-as-the-jury-deliberates-in-sbf-trial-what-happens-next","status":"publish","type":"post","link":"https:\/\/prosfunds.com\/?p=40911","title":{"rendered":"As the Jury Deliberates in SBF Trial, what happens next? As the Jury Deliberates in SBF Trial, what happens next?"},"content":{"rendered":"
\n

As the jury begins deliberations in the trial against Sam Bankman-Fried, questions remain over what impact the verdict will have on the crypto industry as a whole. Here\u2019s what to expect going forward.\n<\/p>\n

The future of FTX<\/h2>\n

\nJohn Jay Ray III, an attorney with a track record for recovering funds from troubled companies, is overseeing its bankruptcy. Previously, Ray was responsible for returning over $820 to creditors of the now-defunct American energy company, Enron.<\/p>\n

\u201cNever in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,\u201d Ray wrote in a 2022 court filing.<\/p>\n

\u201cFrom compromised systems integrity and faulty regulatory oversight abroad to the concentration of control in the hands of a very small group of inexperienced, unsophisticated, and potentially compromised individuals, this situation is unprecedented,\u201d Ray continued.<\/p>\n

\u201cRay\u2019s done an amazing job of clawing back money,\u201d said Enneking. \u201cEspecially when you think they didn\u2019t even have an accurate balance sheet.\u201d<\/p>\n

If the U.S. Bankruptcy Court approves an Amended Plan put forward last summer by FTX debtors, customers should receive \u201cover 90% of distributable value worldwide.\u201d<\/p>\n

\u201cIt was an $8 billion hole, and he\u2019s doing a masterful job of filling it,\u201d Enneking said.\n<\/p>\n

What will happen to SBF\u2019s co-conspirators?<\/h2>\n

\nFormer Alameda Research CEO Caroline Ellison, FTX chief technical officer Gary Wang, and head of engineering for FTX Nishad Singh all testified against their former boss under a cooperation agreement with the U.S. government in hopes of a reduced sentence.<\/p>\n

\u201cIf it\u2019s discovered that they lied (on the witness stand), they breached the contract,\u201d Enneking said, noting that any potential leniency they could receive \u201cgoes out the window.\u201d<\/p>\n

\u201cThey could go back and get a much longer sentence if they discovered they lied during, in this case, Sam\u2019s trial,\u201d Enneking said.<\/p>\n

Enneking likened the co-conspirators\u2019 situation to \u201ca sword of Demicles hanging over their heads,\u201d adding that \u201cthey have a really, really strong incentive to tell the truth.\u201d<\/p>\n

\u201cIt\u2019s just the way human psychology works,\u201d Enneking said, \u201cthey\u2019re going to get a better deal if he is found guilty.\u201d<\/p>\n

\u201cConceivably,\u201d Enneking continued, \u201cSam\u2019s lieutenants could actually testify against each other if any of these plea agreements fall apart and they have to go back to trial.\u201d<\/p>\n

Moreover, Singh, Ellison, and Wang will most likely have to pay significant financial restitution to victims of the doomed crypto exchange as part of their sentencing.<\/p>\n

\u201cThat debt may follow them around literally for the rest of their lives,\u201d said Enneking.\n<\/p>\n

Where does legislation go from here?<\/h2>\n

\nBankman-Fried\u2019s case has forced a spotlight on the lack of regulation in crypto, particularly in the United States.<\/p>\n

\u201cWhat you have in the United States is legislative paralysis, executive overreach, and the judiciary trying to control the situation,\u201d Enneking claims. \u201cI don\u2019t see that changing really anytime soon because of the split House of Representatives.\u201d<\/p>\n

\u201cThe fact he was able to get this far speaks to how much regulation is needed in the crypto space,\u201d says Asma Mohammadi, a law student at American University who has been following the case.<\/p>\n

\u201cI\u2019m interested to see what the ruling is going to be and how the government to make sure something like this will never happen again,\u201d Mohammadi said.<\/p>\n

Equally important, Bankman-Fried\u2019s trial takes place shortly before the U.S. Securities and Exchange Commission is expected to approve the first spot bitcoin exchange-traded fund in early 2024.<\/p>\n

\u201cTo be very honest with you, if smaller crypto companies had more money, they\u2019d all take the S.E.C to court, and my guess is they\u2019d win far more often than they lost,\u201d said Enneking.\n<\/p>\n

High-profile litigation<\/h2>\n

\nDocuments reveal that Bankman-Fried spent over $1 billion in high-profile endorsement deals, which included celebrities like Tom Brady, Steph Curry, Naomi Osaka, Larry David, Giselle B\u00fcnchden, Shaquille O\u2019Neal, and Kevin O\u2019Leary. A number of celebrities who endorsed FTX are now facing litigation themselves as a consequence.<\/p>\n

During the prosecution\u2019s rebuttal Thursday, US Assistant Attorney Danielle Sassoon claimed that Bankman-Fried\u2019s numerous media appearances and high-profile dealings were part of an effort to make himself appear \u201clegitimate\u201d all while using the exchange as a \u201cpersonal piggy bank.\u201d<\/p>\n

\u201cHe was celebrity chasing, and he liked it,\u201d claimed U.S. Assistant Attorney Nicolas Roos.<\/p>\n

The prosecution\u2019s statements follow the defense\u2019s claims that Bankman-Fried acted in \u201cgood faith\u201d while running the crypto exchange. However, the prosecution claimed that this was part of a \u201cmade-up story\u201d that the defendant told before telling the jurors to \u201creject it.\u201d<\/p>\n

\u201cHe thought he could fool customers, fool the public, fool reporters, and now you,\u201d Sassoon said. \u201cDon\u2019t fall for it.\u201d<\/p>\n

The jury is currently deliberating on seven different charges against Bankman-Fried, including wire fraud, conspiracy to commit securities fraud, and conspiracy to commit money laundering. If convicted, Bankman-Fried faces what could be over 100 years in prison. He is currently being housed in the Metropolitan Detention Center in Brooklyn.<\/p>\n

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As the jury begins deliberations in the trial against Sam Bankman-Fried, questions remain over what impact the verdict will have on the crypto industry as a whole. Here\u2019s what to expect going forward. The future of FTX John Jay Ray III, an attorney with a track record for recovering funds from troubled companies, is overseeing […]<\/p>\n","protected":false},"author":1,"featured_media":40912,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[35],"tags":[],"class_list":{"0":"post-40911","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-crypto"},"yoast_head":"\nAs the Jury Deliberates in SBF Trial, what happens next? 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