FTX Founder Bail Agreement

The legal saga surrounding FTX founder Sam Bankman-Fried continues as new developments arise in his case. On March 27, Bankman-Fried’s lawyers reportedly reached a new bail agreement with US prosecutors that would allow him to remain at home while restricting his use of electronic devices and apps. The proposed agreement is still subject to approval by US District Judge Lewis Kaplan, who is overseeing Bankman-Fried’s case.

The proposed bail conditions would prohibit Bankman-Fried from using a smartphone with internet access and any apps other than voice calls and text messaging. He would also be required to use a basic laptop with limited functions and monitoring software to track user activity. The use of any other electronic communication devices is forbidden. Additionally, if there is “reasonable suspicion” of a violation, Bankman-Fried must submit his devices for a search.

The need for new bail conditions arose after Judge Kaplan expressed concerns about Bankman-Fried’s access to electronic devices and the internet. In a previous hearing, the judge attempted to ban Bankman-Fried from using any electronic devices and the internet as a condition of his bail. He argued that Bankman-Fried had a “garden of electronic devices” with internet access available at his parents’ California home. Judge Kaplan also alleged that there was “probable cause” to believe that Bankman-Fried was involved in attempted witness tampering.

To address these concerns, Bankman-Fried’s lawyers proposed the new bail agreement that would limit his access to electronic devices and the internet. The agreement also includes provisions for Bankman-Fried’s parents to restrict his access to their devices and sign affidavits agreeing not to bring prohibited electronic devices into their home.

Bankman-Fried faces criminal charges of stealing billions of dollars in FTX customer funds facilitated through Alameda Research and making large illegal political donations. He has pleaded not guilty to eight criminal counts, which could result in 115 years in prison if convicted. His trial is set for October 2, 2023.

In December 2022, Bankman-Fried was released on bail with conditions that included a $250 million bond, home detention, location monitoring, and the surrender of his passport. However, a few days later, industry investigators allegedly spotted transactions involving Bankman-Fried cashing out about $700,000 in a crypto exchange in Seychelles. Bankman-Fried has denied involvement in this or any other transactions allegedly tied to him or FTX.

Although Bankman-Fried has not been banned from Twitter, he has refrained from any social media activity for a while. His last visible activity on Twitter included a repost on Sullivan & Cromwell continuing to represent FTX debtors on January 20 and a “like” on a report that the firm billed $7.5 million for the first 19 days of FTX work.


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Craig Wright Liable for $100 Million in Kleiman Case

Key Takeaways

  • Kleiman v. Wright, one of the most significant ongoing trials related to cryptocurrency, concluded today.
  • A jury in Florida found Wright liable for $100 million, to be paid to W&K Information Defense Research.
  • Wright was cleared of all other charges.

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Craig Wright has been found liable for $100 million but cleared of other charges in a case concerning his former business partner.

$100 Million Lost Is a Win for Wright

The case concerned Dave Kleiman, Wright’s business partner who passed away in 2013. Wright allegedly took Bitcoin-related assets from W&K Information Defense Research LLC, the Florida-based company created by Wright and Kleiman a decade ago.

Wright faced roughly $189 billion in damages for counts ranging from fraud and theft to a breach of fiduciary duty. Jurors cleared Wright on all charges except conversion, for which he is liable for $100 million, to be paid to W&K Information Defense Research.

Both the plaintiff’s attorneys and the defendant appear satisfied or at least are seeing the trial’s outcome with an optimistic mindset.

Kleiman estate attorney Vel Freedman said his team was “thrilled” with the $100 million sum that will be paid to W&K.

Meanwhile, Wright said he was “incredibly relieved” despite the $100 million owed, adding that the outcome is “not bad at all.” This suggests he has no plans to appeal the verdict.

The trial was carried out as Ira Kleiman, et al., v. Craig Wright in the United States District Court Southern District of Florida.

Previous Motion of Judgement Failed

Last week before closing arguments, Wright’s attorneys filed a Motion for Judgement as a Matter of Law, which is an appeal to the judge that no sufficient evidence has been provided by the plaintiff.

Wright’s lawyers argued, among other things, that the selling of Wright’s cryptocurrency could harm the market price of Bitcoin, but the judge disagreed and denied the motion. 

The Kleiman case has little relation to Wright’s dubious claim that he is the true identity behind Bitcoin creator Satoshi Nakamoto, which has been the focus of other past cases.

Disclosure: At the time of writing, the author of this piece held BTC and several other cryptocurrencies. 

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