TheWeek The Week US Edition US UK SUBSCRIBE & SAVE Less than $3 per week × Search Sign in View Profile Sign out Daily Briefing Talking Points The Week Recommends Newsletters Cartoons From the Magazine The Week Junior More Politics World News Business Health Science Food & Drink Travel Culture History Personal Finance Puzzles Photos All Categories Newsletter sign up Newsletter Tech Sam Bankman-Fried found guilty: where does crypto go from here? Conviction of the ‘tousle-haired mogul’ confirms sector’s ‘Wild West’ and ‘rogue’ image, say experts Newsletter sign up Newsletter Sam Bankman-Fried was arrested in December 2022 after the collapse of FTX and later charged with seven counts of fraud and conspiracy (Image credit: Illustration / Alamy / Getty Images) By Chas Newkey-Burden, The Week UK published 3 November 2023 Sam Bankman-Fried, who ran one of the world’s biggest cryptocurrency exchanges, faces decades in prison after he was found guilty of fraud and money laundering. The trial in New York of the 31-year-old “tousle-haired mogul”, who founded the FTX cryptocurrency exchange, “laid bare the hubris and risk-taking across the crypto industry”, said The New York Times. The verdict “capped what prosecutors called one of the biggest financial frauds in American history”, said Politico. But commentators are at odds over exactly what it means for the future of the crypto industry. Subscribe to The Week Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives. SUBSCRIBE & SAVE Sign up for The Week’s Free Newsletters From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox. From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox. Sign up What did the papers say? For the “broader cryptocurrency business”, the conviction “could provide a long-awaited chance to move forward”, said Reuters. For some in the sector, Bankman-Fried’s conviction on seven counts of fraud and conspiracy “points to the end of an era of risky and wrongful practices”, and “a more regulated future”, said Bloomberg. But others outside the industry are “taking a much tougher line”, arguing that the verdict “confirms crypto as a sector riven with weaknesses that attract criminals, hackers and rogue states”. Bankman-Fried, who was arrested last year after his firm, FTX, went bankrupt, has “done irrevocable damage to this industry”, said Sky News, “reinforcing the narrative of a Wild West where consumers have no protection”. So it will “take years for the crypto world to rehabilitate its image, if it ever does at all”, added the broadcaster. Jordan Estes, a former prosecutor, told Wired that the US Department of Justice will consider the conviction a “signature victory” and its first high-profile crypto scalp. He was “crypto royalty”, which “lends his conviction a symbolic importance”. But “despite widespread predictions of cryptocurrency’s demise”, there is “still a market for virtual assets”, said Reuters, noting that the price of bitcoin has more than doubled this year as “large financial institutions” like BlackRock “seek to make the virtual currency more respectable”. What next? Further legal headaches are expected for crypto. After Bankman-Fried “met his fate” with the justice system, “much of the rest of the industry is facing its own legal showdowns with the [US] government”, said Politico. “Crypto giants” like Binance, Coinbase and Gemini are “still heading for courtroom clashes” with regulators that could “prove an even greater peril to the market’s future” than FTX’s collapse in 2022. Closer to home, the UK government unveiled plans earlier this week to regulate the crypto industry in a similar way to traditional financial investments that would require all crypto companies to be authorised by the Financial Conduct Authority (FCA). But this plan has already come under attack by a former head of the regulator, noted the Financial Times. Charles Randell, who quit as chair of the FCA last year, warned that “investors risked being harmed if crypto assets were labelled as regular investments”. We can expect some within the sector to try to position themselves as non-crypto projects, said The New York Times. Several crypto companies have “tried rebranding”, it said. Autograph, an NFT start-up co-founded by former American football star Tom Brady, “quietly removed some of the crypto language from its marketing”, and Paradigm Capital “erased mentions of the word ‘crypto’ from its website”, instead describing itself as a “research-driven technology investment firm”. Meanwhile, the broader tech industry has “done what it does best: move on to the next thing”, it added. Silicon Valley is “no longer fixated on crypto” and although crypto firms “may come back around in a few years”, for now “they are out of style and therefore irrelevant”. As for Bankman-Fried, it is unclear whether he will appeal against the verdict. He had pleaded not guilty to all the charges, insisting that he had acted in good faith. His sentencing has been set for 28 March next year. Explore More Bitcoin Cryptocurrency Today’s Big Question Fraud Cryptocurrencies Silicon Valley Continue reading for free We hope you’re enjoying The Week’s refreshingly open-minded journalism. sign up to continue reading Already have an account ? Sign in here Subscribed to The Week? Register your account with the same email as your subscription. Sign up to our 10 Things You Need to Know Today newsletter A free daily digest of the biggest news stories of the day – and the best features from our website Contact me with news and offers from other Future brandsReceive email from us on behalf of our trusted partners or sponsorsBy submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over. Chas Newkey-Burden, The Week UK Social Links Navigation Chas Newkey-Burden has been part of The Week Digital team for more than a decade and a journalist for 25 years, starting out on the irreverent football weekly 90 Minutes, before moving to lifestyle magazines Loaded and Attitude. He was a columnist for The Big Issue and landed a world exclusive with David Beckham that became the weekly magazine’s bestselling issue. He now writes regularly for The Guardian, The Telegraph, The Independent, Metro, FourFourTwo and the i new site. He is also the author of a number of non-fiction books. 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Sam Bankman-Fried found guilty: where does crypto go from here?
