Samuel Benjamin Bankman-Fried (born March 5, 1992), commonly known as SBF, is an American entrepreneur who was convicted of fraud and related crimes in November 2023. Bankman-Fried founded the FTX cryptocurrency exchange and was celebrated as a "poster boy" for crypto, with FTX having a global reach with more than 130 international affiliates. At the peak of his net worth, he was ranked the 41st-richest American in the Forbes 400.
In November 2022, as evidence of potential fraud began to surface, depositors quickly withdrew their assets from FTX, forcing the company into bankruptcy. On December 12, 2022, Bankman-Fried was arrested in the Bahamas and extradited to the United States, where he was indicted on seven criminal charges, including wire fraud, commodities fraud, securities fraud, money laundering, and campaign finance law violations.
In the case of United States v. Bankman-Fried, he was convicted of all seven counts of fraud, conspiracy, and money laundering. On March 28, 2024, he was sentenced to 25 years in prison and ordered to forfeit $11 billion. The trial was one of the most notorious cases of white-collar crime in the United States; the financier Anthony Scaramucci termed Bankman-Fried "the Bernie Madoff of crypto".
Sam Bankman-Fried was born on March 5, 1992, to upper-middle class Jewish parents in Stanford, California. His parents are Barbara Fried and Joseph Bankman, both professors at Stanford Law School. His maternal grandmother, Adrienne Fried Block, was a noted musicologist. His maternal grandfather, George Fried, was an administrator with the New York State Supreme Court probation department.
His aunt Linda P. Fried was the dean of Columbia University Mailman School of Public Health.
Sam's younger brother, Gabriel (b. 1995), had been a legislative assistant and a Wall Street trader. He became director of the nonprofit Guarding Against Pandemics and its associated political action committee. The PAC had come under scrutiny by federal investigators after the discovery that much of the US$35 million on its books had been stolen by Sam from Alameda Research customer accounts.
Both of his parents were sued by the new owners of FTX, to return assets Sam had given the couple in the form of cash and a home valued at over $32 million. His parents admitted Sam gave them the assets as gifts but denied wrongdoing and the case was eventually dropped.
Bankman-Fried attended Canada/USA Mathcamp, a summer program for mathematically talented high-school students. He attended high school at Crystal Springs Uplands School in Hillsborough, California.
He graduated from the Massachusetts Institute of Technology in 2014 with a bachelor's degree in physics and a minor in mathematics. As an MIT student, he lived in a coeducational group house called Epsilon Theta.[1]
In the summer of 2013, Bankman-Fried worked as an intern at Jane Street Capital, a proprietary trading firm, trading international ETFs. He returned there to work full-time after graduating from MIT. In September 2017, Bankman-Fried left Jane Street and moved to Berkeley, California, where he worked briefly at the Centre for Effective Altruism (CEA) as director of development from October to November 2017.
In November 2017, following fund injections from billionaire computer programmer Jaan Tallinn and investor Luke Ding, Bankman-Fried and CEA's Tara Hedley (née Mac Aulay) cofounded the quantitative trading firm Alameda Research. By 2021, Bankman-Fried owned approximately 90 percent of Alameda Research. In January 2018, Bankman-Fried organized an arbitrage trade, moving up to $25 million per day to take advantage of the higher price of bitcoin in Japan compared to the United States. After attending a cryptocurrency conference in Macau in late 2018, he moved to Hong Kong.
Bankman-Fried founded the FTX cryptocurrency derivatives exchange in April 2019; it opened for business the following month. In September 2021, Bankman-Fried and the entire senior staff of FTX moved from Hong Kong to the Bahamas. Bankman-Fried was included on the 2021 list of Forbes 30 Under 30 but was also included on Forbes 2023 Hall of Shame list, featuring ten picks the publication wishes it could take back.
On December 8, 2021, Bankman-Fried, along with other industry executives, testified before the Committee on Financial Services about regulating the cryptocurrency industry. On May 12, 2022, it was disclosed that Emergent Fidelity Technologies Ltd., which was majority owned by Bankman-Fried, had bought 7.6 percent of Robinhood Markets stock. In a November 2022 affidavit before the Eastern Caribbean Supreme Court, and prior to his arrest, Bankman-Fried said he and FTX cofounder Gary Wang together borrowed over $546 million from Alameda Research in order to finance Emergent Fidelity Technologies' purchase of Robinhood Markets stock.
In September 2022, it was reported that Bankman-Fried's advisors had offered on his behalf to help fund Elon Musk's purchase of Twitter. According to messages released as part of the lawsuit between Twitter and Musk during the latter's acquisition of Twitter, on April 25, 2022, investment banker Michael Grimes wrote that Bankman-Fried would be willing to commit up to $5 billion. No investment actually took place when Musk finalized the acquisition. Bankman-Fried invested $500 million in Anthropic and more than $500 million in venture capital firms, including $200 million in Sequoia Capital, itself an investor in FTX. Sequoia published a "glowing" profile of Bankman-Fried, which it subsequently removed after the solvency crisis at FTX. In July 2023, allegations emerged that Bankman-Fried had considered "purchasing" the island country of Nauru to use as a bunker in the event of an apocalyptic event, in what has been described as a "misguided and sometimes dystopian" project.[1]
Bankman-Fried is vegan. He was raised in a Jewish family. In mid-2021 it was reported that he lived with approximately 10 roommates in a five-bedroom Bahamian penthouse bought by co-CEO of FTX Ryan Salame. After FTX's collapse, the penthouse was put up for sale for close to $40 million. Bankman-Fried had a relationship with Alameda Research CEO Caroline Ellison that lasted around six months and ended on April 15, 2022. While testifying against him in court in October 2023, she claimed that his hairstyle and clothes were part of a "well calculated" image that he tried to project. She stated that Bankman-Fried believed he had received higher bonuses while working at Jane Street because of his hair and used his appearance as "an important part" of FTX's "narrative and image." In court, he appeared wearing a grey suit with trimmed hair.
Bankman-Fried once played the video game League of Legends while on a call attempting to secure an investment from Sequoia Capital, talking about how FTX would become a "super app." The investors were "incredibly impressed," with one calling the call "one of those your-hair-is-blown-back type of meetings." Afterward, Sequoia ended up investing over $200 million in FTX. An article in the Financial Times later characterized Bankman-Fried's "win ratios" in League of Legends as "average-to-bad".
Τhroughout the legal process, Bankman-Fried's parents stood by him, writing in a December 2022 letter, around the time of the arrest, "You are innocent." In an e-mail to The New Yorker, his mother, Barbara Fried, denounced the actions of the prosecution and the bankruptcy team as "McCarthyite" and a "relentless pursuit of total destruction," which is enabled by "a credulous public." After Bankman-Fried was incarcerated during the trial, his parents took turns traveling every Tuesday from California to be with him at the Brooklyn jail where he awaited the outcome of his trial, and the sentencing phase. She wrote a letter to the judge in February 2024 arguing for lenient sentencing, saying that Bankman-Fried would face extreme danger in prison because he has "trouble responding appropriately to many social cues".[1]
