THROWBACK: Exactly 2 Years Ago Today, SBF Was Sentenced to 25 Years in Prison
The biggest fraud in crypto history.
$8 BILLION in customer funds stolen.
Here's the FULL story of how FTX rose to the top and collapsed in just 10 days.
A thread every crypto investor MUST read 🧵👇
1️⃣ THE RISE OF SBF
2019: Sam Bankman-Fried, a former Jane Street trader, launched FTX with co-founder Gary Wang
2021:#FTX hit $1B in revenue. SBF's net worth reached $26B. Forbes named him the richest person under 30
FTX became the 3rd largest crypto exchange globally with 1M+ users
2️⃣ THE FTX EMPIRE AT ITS PEAK:
→ Super Bowl ads featuring Larry David
→ Endorsement deals with Tom Brady, Steph Curry, Shaq
→ $135M naming rights deal for Miami Heat's arena
→ $32B valuation
→ Backed by Sequoia, SoftBank, BlackRock, Temasek, Ontario Teachers' Pension
SBF was everywhere. Magazine covers. Congressional hearings. Charity galas.
3️⃣ THE DARK SIDE: What Was Really Happening
Behind the scenes, #SBF was secretly funneling FTX customer deposits to Alameda Research, his private trading firm.
Alameda had a hidden backdoor in FTX's code that exempted it from standard risk checks.
This gave Alameda virtually unlimited access to customer funds for risky bets, real estate, and political donations.
4️⃣ THE COLLAPSE: 10 Days That Shook Crypto
Nov 2, 2022: CoinDesk leaks Alameda's balance sheet showing most assets were in FTT, a token FTX created themselves
Nov 6: Binance CEO CZ announces he's selling all $580M of FTT holdings. This triggers mass panic.
Nov 7: $4B+ in withdrawals hit FTX in 24 hours
Nov 8: FTX halts all withdrawals. Customers locked out.
5️⃣ Collapse Continued
Nov 8: Binance signs a non-binding LOI to acquire FTX
Nov 9: Binance walks away after just hours of due diligence. The books were that bad.
Nov 10: Bahamian regulators freeze FTX assets
Nov 11: FTX files for Chapter 11 bankruptcy. SBF resigns. John J. Ray III (who handled Enron's bankruptcy) takes over.
Ray said FTX had the WORST financial controls he'd seen in 40 years of restructuring.
6️⃣ THE FALLOUT:
→ $8B+ hole in customer accounts
→ BTC crashed below $16,000
→ Sequoia wrote down $210M to $0
→ Genesis suspended withdrawals, later filed bankruptcy
→ Crypto.com's CRO token lost ~$1B in value
→ Contagion spread across the entire industry
One man's fraud triggered a full-blown crypto winter.
7️⃣ THE ARREST & TRIAL:
Dec 12, 2022: SBF arrested in the Bahamas, extradited to US
Charged with 7 counts including wire fraud, securities fraud, and money laundering
His inner circle flipped on him. Caroline Ellison, Gary Wang, and Nishad Singh all pleaded guilty and testified against SBF.
Nov 2, 2023: Found GUILTY on all 7 counts. Jury deliberated less than 5 hours.
8️⃣ THE SENTENCE: March 28, 2024
Judge Lewis Kaplan sentenced SBF to 25 years in federal prison.
Prosecutors wanted 40-50 years. SBF's lawyers asked for just 5-6 years.
The judge said SBF committed perjury during his own testimony, showed zero remorse, and posed a future risk to society.
He was also ordered to forfeit $11.02 BILLION.
9️⃣ WHAT HAPPENED TO HIS CO-CONSPIRATORS:
Caroline Ellison (Alameda CEO): 2 years in prison
Gary Wang (FTX co-founder): Time served, no prison
Nishad Singh (FTX engineering head): Time served, no prison
Ryan Salame (FTX executive): 7.5 years
All cooperated with prosecutors. SBF refused and paid the heaviest price.
🔟 WHERE IS SBF NOW (March 2026):
Currently serving his sentence at FCI Terminal Island, California
His appeal was heard by the Second Circuit on Nov 4, 2025. Judges appeared skeptical of his arguments. Ruling still pending.
In Feb 2026, his mother filed a new appeal claiming FTX was never truly insolvent.
His parents are also reportedly exploring a presidential pardon from Trump. Prediction markets put pardon odds at roughly 9-11%.
SBF has pivoted politically, appearing on Tucker Carlson's show praising Trump's crypto stance.
1️⃣1️⃣ FTX Creditors: SILVER LINING FOR VICTIMS:
FTX's bankruptcy estate recovered nearly $16B.
98% of creditors are set to receive 119% of their allowed claims (based on Nov 2022 values).
But many argue this doesn't account for the massive crypto gains they missed. BTC was ~$16K when FTX collapsed. It's significantly higher now.
The "made whole" argument remains highly debated.
1️⃣2️⃣ KEY LESSONS FROM THE FTX COLLAPSE:
✅ Not your keys, not your crypto. Self-custody matters.
✅ No exchange is "too big to fail."
✅ Always verify Proof of Reserves.
✅ Celebrity endorsements mean NOTHING about platform safety.
✅ If yields look too good to be true, they are.
✅ Diversify across wallets and platforms. Never go all-in on one exchange.
SBF went from Forbes' richest under-30 to federal inmate 37244-510 in just 12 months.
The FTX collapse was crypto's darkest chapter but also its biggest lesson.
2 years later, the industry is stronger, more regulated, and more transparent.
But never forget what happened.
Stay safe. Stay sovereign. DYOR.
Not Financial Advice. ALWAYS DYOR.