Here’s Why SBF’s Second Trial Halt Has Sparked Outrage

The disgraced crypto founder was initially set to face six additionally charges, including campaign finance charges in March 2024.

Sam Bankman resting on A pile of money for Polical Donations.
Created by Kornelija Poderskytė from DailyCoin
  • The DOJ’s decision not to pursue further charges against FTX founder Sam Bankman-Fried (SBF) has sparked outrage.
  • The response follows lingering questions over the FTX founder’s political donations.
  • President Joe Biden and nearly half of Congress are listed as recipients of FTX’s political donations.

The trial of Sam Bankman-Fried (SBF) will likely rank among the most followed crypto cases of all time, as many sought to grasp the fast rise and even faster crash of the former crypto wunderkind.

Following the announcement of a guilty verdict on eight initial fraud-related charges in November 2023, onlookers had set their sights firmly on March 2024 when the FTX founder was set to stand trial for six additional charges and face sentencing for the initial eight charges.

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However, on Friday, December 29, the U.S. Department of Justice (DOJ) submitted a filing outlining that it would no longer pursue outstanding charges. While experts have deemed the DOJ’s decision practical, with SBF already likely to go to jail for a long time, outrage continues to trail the decision, begging the question of why.

Interest in SBF’s Campaign Donations

Among the six charges the DOJ dropped are related to SBF’s political donations, which have been a hot-button topic since the 2022 midterms. 

These donations again came into focus as prosecutors successfully argued that they came from a mix of FTX customer funds. Several observers called for deeper investigations, arguing that politicians played a role in SBF’s fast rise by platforming the now disgraced crypto founder.

However, with the DOJ’s recent decision to drop the campaign finance charges, many contend that the DOJ has effectively cut off the line of inquiry and prevented the conversation from reaching a broader audience to protect certain political interests. Commenting on the matter, Coinbase Chief Legal Officer Paul Grewal noted:

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“I think this is a miscarriage of justice. The public interest in a public airing of charges almost always matters. Campaign finance charges are at the very top of this list. What politicians and others knew what and when are critical questions that deserve answers.”

The DOJ’s timing has further stoked speculation around its decision. Several onlookers have implied that the DOJ had decided to release the decision on a holiday weekend to avoid sustained attention. These observers have also noted that the decision comes ahead of the 2024 elections, where many recipients of SBF’s political donations will be running for another term in office, including U.S. President Joe Biden.

Tracing SBF’s Campaign Donations

An Open Secrets spreadsheet estimates that FTX executives gave about $84 million to support political campaigns from 2020 to 2022, including an estimated $46.5 million linked directly to SBF. While the FTX founder’s donations had initially been heavily linked to Democratic candidates, including President Biden, he asserted that he had given just as much to Republicans in a November 2022 interview.

In November 2023, finance tracking platform unusual_whales released a list of politicians that had received funding from SBF, estimating that the list comprised about 40% of Congress.

On the Flipside

  • The DOJ’s decision not to pursue campaign finance charges does not impede the FTX bankruptcy estate’s efforts to recoup the political donations to repay creditors.
  • The DOJ argues that they had already laid out the evidence relating to SBF’s campaign finance charges in the October 2023 trial.

Why This Matters

The collapse of SBF’s FTX led to about $8 billion in customer losses. The reaction to the DOJ’s decision not to pursue further charges highlights the desire for those who facilitated the FTX founder’s fast rise to be held accountable.

Read this to learn more about the DOJ’s decision:
FTX’s SBF Evades Second Trial as Prosecutors Drop Charges

See why the crypto community is enthusiastic about Barry Silbert’s resignation from Grayscale’s board:
Barry Silbert Grayscale Resignation Fans Bitcoin ETF Flames

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Okoya David

David Okoya is a crypto news reporter at DailyCoin based in Nigeria. He covers various topics related to the cryptocurrency industry, including exchanges, regulations, and price movements, and strives to bring fresh angles to breaking news. With experience as a freelance crypto news writer, David upholds the highest journalistic standards, telling complete stories and answering lingering questions whenever possible.