Sam Bankman-Fried loses appeal against crypto fraud conviction

Sam Bankman-Fried is not going home. The US Court of Appeals for the Second Circuit on June 12 denied the former FTX CEO’s bid to overturn his fraud conviction, keeping his 25-year prison sentence firmly intact.

The three-judge panel was unanimous. They described the government’s case against Bankman-Fried as, in their words, “conservatively stated, robust.”

The full weight of seven counts

Bankman-Fried was convicted in November 2023 on seven counts, including wire fraud, securities fraud, and money laundering. The charges stemmed from what prosecutors characterized as one of the largest financial frauds in recent American history.

Bankman-Fried used customer deposits held at FTX, the cryptocurrency exchange he founded, and funneled them to Alameda Research, his affiliated trading firm. Billions of dollars that customers believed were safely held on the exchange were instead deployed elsewhere, without their knowledge or consent.

His sentence, handed down on March 28, 2024, came with 25 years in federal prison, three years of supervised release, and over $11 billion in forfeiture. The appeal arguments were heard in November 2025. A separate motion for a new trial was denied in April 2026. And in early June 2026, Bankman-Fried filed a pardon petition.

How the dominoes fell

FTX, once valued at $32 billion, collapsed in November 2022. What started as a liquidity crunch triggered by reporting on Alameda Research’s balance sheet quickly spiraled into a full-blown bank run on the exchange. Customers couldn’t withdraw their funds because the money wasn’t there.

His trial moved quickly by federal standards. Prosecutors called former members of his inner circle as witnesses, several of whom had already pleaded guilty to their own charges and cooperated with the government. Caroline Ellison, the former CEO of Alameda Research and Bankman-Fried’s ex-girlfriend, was among the most prominent cooperators.

The jury deliberated for roughly five hours before returning guilty verdicts on all seven counts.

What this means for crypto investors

The unanimous appellate ruling sends an unambiguous signal: crypto fraud will be prosecuted and punished with the same severity as traditional financial fraud. The appeals court didn’t find any procedural errors worth reversing and described the evidence as more than sufficient.

The conviction establishes a clear precedent. Future prosecutors handling crypto fraud cases will point to Bankman-Fried’s sentence as a benchmark. Twenty-five years in federal prison signals the DOJ takes these cases seriously.

With the pardon petition still technically outstanding but the appeals path now exhausted, the over $11 billion in forfeiture represents one of the largest clawbacks in financial fraud history, though whether victims will ever be made fully whole remains an open question that will play out over years of bankruptcy proceedings.

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