This moment is ultimately rooted in a November 2022 report published by Coindesk, which first shed light on the questionable finances behind FTX and SBF’s hedge fund Alameda Research. A bank run soon followed, and FTX’s house of cards rapidly collapsed. Competing company Binance had swooped in with plans to acquire FTX, something that was complicated by its prior — and suitably cryptic — decision to dump its FTT, which was FTX’s own crypto token.
Within days, however, Binance suddenly backed out of the deal. The Department of Justice was very interested in getting details on what led to that reversal, and both the DOJ and SEC had been investigating the crypto company. Fast-forward to December 21, 2022, and both former Alameda CEO Caroline Ellison and FTX co-founder Gary Wang had charges filed against them.
That same week, Bankman-Fried was extradited to the U.S. and, initially, into the custody of his parents. However, SBF found himself behind bars in mid-August 2023 over concerns about potential witness tampering. With the verdict out of the way, Bankman-Fried has been returned to the same Brooklyn detention center to await sentencing.