Fall of a Crypto Giant: Sam Bankman-Fried’s Rapid Rise and Sudden Arrest

December 2021, bahamian police arrested sam bankman-fried, a man who had gained notoriety for his lavish spending on marketing and political donations, and his popular twitter threads. elliot lutzker, chair and partner at davidoff hutcher & citron, compared bankman-fried to bernie madoff and noted that both men had good intentions in the beginning. bankman-fried had begun his career as an intern at jane street capital and went on to found alameda research, an exchange-traded fund, and ftx.com, an international crypto exchange.

Arrest of bankman-fried occurred in december 2021 in the bahamas. sam lutzker, a former sec attorney, noted the peculiarity of criminals that operate in secrecy, not registering with the sec or as a broker-dealer, and having most of their assets offshore. bankman-fried had been determined to make an impact in d.c., spending millions on political donations and frequently attending events to hold court on the crypto industry.

Ray iii, the new ftx ceo, coined the company’s “paperless bankruptcy” due to bankman-fried’s approachability. bankman-fried kept a tight inner circle during his time at ftx and alameda research that included former director of engineering, nishad singh, and co-founder gary wang. despite being inexperienced and unsophisticated, bankman-fried had been determined to make an impact in d.c. it was this recklessness that led to his arrest, as he had been running his companies in an irresponsible manner. his parents, a law professor and political advocate, have been in the wings helping to advocate on his behalf, while his brother was instrumental in guiding his philanthropic efforts.


By Evey Lovelace

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