Lawyers for Sam Bankman-Fried, the convicted founder of the collapsed cryptocurrency exchange FTX, are set to appear before the 2nd U.S. Circuit Court of Appeals on Tuesday, urging judges to overturn his 2023 fraud conviction.
Bankman-Fried, 33, is currently serving a 25-year prison sentence after a Manhattan federal jury found him guilty on seven criminal counts, including wire fraud and conspiracy, for stealing $8 billion in customer funds.
Prosecutors labeled it a “fraud of epic proportions,” alleging that he diverted billions from FTX user deposits to cover losses at his trading firm, Alameda Research.
At his trial, Bankman-Fried admitted to making management mistakes but denied stealing money, maintaining that he believed FTX had sufficient liquidity to meet customer withdrawals.
His defense team now argues that he was deprived of a fair trial because U.S. District Judge Lewis Kaplan barred evidence that could have supported this belief.
“The jury was not allowed to see critical evidence showing that Mr. Bankman-Fried acted in good faith,” his attorneys are expected to argue, according to court filings.
Prosecutors, however, have maintained that the case against Bankman-Fried was overwhelming, pointing to testimony from three senior FTX executives, Caroline Ellison, Gary Wang, and Nishad Singh, who cooperated with the government and described how he directed them to misuse customer funds.
Troves of internal FTX documents and financial records further corroborated their accounts.
Judge Kaplan, in sentencing Bankman-Fried in March 2024, said the former crypto mogul “knew his actions were wrong but made a very bad bet about the likelihood of getting caught.”
Bankman-Fried’s downfall remains one of the most dramatic in the history of the cryptocurrency industry. Once celebrated as a visionary billionaire and major political donor, he now faces years behind bars while his legal team fights for a new trial.
Media reports have also suggested that his allies are lobbying former President Donald Trump for a potential pardon, though Trump has not commented publicly on the matter.