Trump pardons CZ and SBF takes action! FTX founder seeks to overturn 25-year sentence.

FTX founder SBF is actively seeking legal appeals and a presidential pardon from Trump two years after his conviction. He has been voicing his claims of innocence through social media and blaming the company's collapse on the bankruptcy administrators and judicial unfairness. Since Trump returned to the White House in January, he has pardoned several leaders in the Crypto Assets industry who were convicted of white-collar crimes, including Binance billionaire founder CZ. According to the New York Times, SBF's family has intensified their lobbying efforts for the pardon this spring.

SBF relaunches social media to launch a public opinion counterattack

On September 23, 2024, SBF's social media account spoke for the first time after being silent for more than six months, simply posting “gm” (an internet term meaning “good morning”). Since then, the account has been continuously updating its content. These posts criticize the FTX bankruptcy estate administrator and focus on rebutting certain claims about the financial situation at the time of FTX's collapse, insisting that customer funds were never lost, only trapped in illiquid assets.

SBF's social media strategy is very clear: to shape himself as a victim of judicial injustice and greedy lawyers. He repeatedly emphasizes that the collapse of FTX was not due to the misappropriation of customer funds, but rather because the bankruptcy administrators hurriedly liquidated assets and sold investments that could have been recovered at a low price. This claim attempts to shift responsibility from himself to the bankruptcy process and legal team, implying that if given enough time, FTX could have repaid all debts.

Although SBF cannot use the internet while in prison, it is said that friends have been posting on his behalf. This arrangement itself has sparked controversy, as federal prisons typically impose strict limits on inmates' external communications, and having others post social media content may violate prison regulations. However, this risk is clearly seen by the SBF team as worth taking, as maintaining public attention is crucial to their clemency strategy.

SBF is still in prison and has been interviewed by Mother Jones magazine, where he maintained the same viewpoint in the October publication. This interview gave SBF the opportunity to directly state his position to a mainstream media audience, rather than through court documents or lawyer statements. In the interview, SBF portrayed himself as an entrepreneur who made a business judgment error but did not engage in intentional fraud, and emphasized that FTX still had assets to repay customers at the time of its collapse.

SBF's mother, law professor Barbara Fried, recently launched a Substack column. The only post published at the end of October is a 65-page paper titled “The Trial of Sam Bankman-Fried,” which argues that her son neither committed fraud nor received a fair trial. This paper employs an academic writing style, citing numerous legal precedents and rules of evidence, attempting to prove SBF's innocence from a legal perspective. As a law professor at Stanford University, Barbara's professional background adds authority to this paper, but it also raises questions about conflicts of interest.

Representatives for Bankman-Fried confirmed that Barbara authored the article, but stated that they were unaware of the social media posts and did not respond to further requests for comment. This response strategy attempts to maintain public relations momentum while distancing itself from potentially non-compliant social media activities to avoid impacting formal legal proceedings.

Legal appeals are fraught with difficulties, with a success rate of less than 10%

SBF's reappearance seems to adopt a two-pronged strategy for his release: formally appealing in court while seeking public sympathy in the court of public opinion. As soon as the verdict was announced, SBF indicated his intention to appeal. The core argument of the appeal is that the jury “only saw one side of the story,” as the presiding judge, Lewis Kaplan, ruled to prevent the defense from presenting evidence that could undermine the prosecution's case.

SBF's lawyer wrote in the appeal filed in January that the judge favored the prosecution at every turn, leading to a severely unfair trial: the district court allowed the government to submit false charges, concealed contrary evidence from the jury, and misdirected the application of the law, effectively guiding towards a guilty verdict. These allegations are extremely serious, and if substantiated, would provide sufficient grounds to overturn the original judgment. However, proving that the judge's rulings constitute an “abuse of discretion” is a very high legal threshold.

On November 4, SBF's lawyer, Alexandra Shapiro (who also represents Sean Diddy Combs and entrepreneur Charlie Javice in their appeal cases), presented these arguments to the panel of the Second Circuit Court of Appeals. Reportedly, the judges expressed skepticism regarding the claim of an unfair trial, with one noting that the lawyer's criticism of Judge Kaplan seemed to exceed the case itself. This reaction suggests that the appellate court may not support SBF's arguments.

Daniel Richman, a law professor at Columbia University and former federal prosecutor, analyzes that lawyers must have made a professional judgment to choose to criticize the judge's discretion as one of the few viable avenues for appeal. Both Naftalis and Richman remind that predicting the outcome of an appeal based on comments made during the judge's oral arguments is unreliable. Generally speaking, the success rate of criminal appeals is low (about 5%-10%), and appeals based on judicial discretion are particularly difficult to establish.

Christopher Lavine, a partner at Wethers Law Firm, stated candidly that it would be surprising if the ruling were overturned. The court could make a decision at any time. A former prosecutor pointed out that after the oral arguments, it may take the judge anywhere from a month to several years to issue a ruling.

Main Legal Obstacles for SBF's Appeal

Low Success Rate of Appeals: The overall success rate of criminal appeals is only 5%-10%, and appeals regarding the discretion of judges are even more difficult.

Judge's Attitude is Skeptical: The panel of the Second Circuit Court of Appeals expressed doubts about the defense's arguments.

High Burden of Proof: It is necessary to prove that the judge “abused discretion”, which is an extremely high legal standard.

Uncertain Timeframe: Judgments may take from one month to several years, increasing uncertainty.

Trump's pardon becomes SBF's last lifeline

A former prosecutor pointed out that the public's general perception of SBF will not affect the appeal case, but it may influence his efforts to seek a presidential pardon from Trump. Since returning to the White House in January, Trump has pardoned several leaders in the Crypto Assets industry who were convicted of white-collar crimes. This is clearly a public relations campaign, said former prosecutor and current Pallas Partners law firm partner Joshua Naftalis, describing it as a strategy that leaves no stone unturned.

After Trump returned to the White House, he pardoned several leaders in the crypto assets sector, including the billionaire founder of Binance, CZ. Trump stated that based on advice from “reliable individuals,” he eliminated CZ's criminal record and indicated that this founder was indeed a victim of the Biden administration, which is hostile to crypto assets, and had not committed a crime (Zhao admitted in 2023 to failing to maintain effective anti-money laundering safeguards). This precedent provides hope for SBF's pardon strategy.

According to a report by The New York Times, SBF's family has intensified its lobbying for a pardon this spring. His team believes that Trump, who repeatedly claims to be a victim of a “legal battle,” might resonate with the narrative that SBF is being deliberately portrayed as the mastermind by prosecutors. This strategy attempts to leverage Trump's distrust of the judicial system to present SBF as yet another victim of “judicial persecution.”

However, a White House spokesperson told WIRED that SBF has not yet submitted a formal pardon application and stated that they would not publicly discuss speculation about sensitive issues like pardons. This response neither completely ruled out the possibility nor provided a clear commitment, leaving room for future developments.

Recent social media posts, media interviews, and columns by his mother all support this claim, insisting on SBF's innocence and attributing the collapse of FTX and customer losses to greedy legal professionals, who are accused of profiting from the rushed bankruptcy process. FTX bankruptcy estate spokesperson Maggi Calanjiro responded that all professional fees were reviewed by independent examiners and approved by the court, refuting the accusations from the SBF team.

During the trial, a witness testified that SBF once expressed a willingness to flip a coin to decide whether to risk destroying the world, if the alternative was to double human welfare. No wonder he seems to be placing bets on multiple sides now. This dual strategy of pursuing a legal appeal while lobbying for a pardon is a typical manifestation of SBF's character—simultaneously betting on multiple uncertain outcomes, hoping that one of them will succeed.