The Crypto Elite's Dirty Laundry: How SBF Funded His Defense

Sam Bankman-Fried’s legal battle just got messier. While awaiting sentencing on seven fraud counts, sources reveal the disgraced FTX founder’s multimillion-dollar defense was bankrolled by—you guessed it—customer funds.

Here’s the receipts: Back in 2021, SBF transferred millions to his father Joseph Bankman (a Stanford Law prof) via a loan from Alameda Research, exploiting tax loopholes in the process. Now that money’s allegedly funding his legal war chest, handled by former federal prosecutors Mark Cohen and Christian Everdell.

The Math Doesn’t Add Up

While SBF’s defense sits in the millions, we’re talking about a guy who allegedly diverted $10 billion in customer deposits to Alameda for trading that never happened. His parents even leveraged their California home for his $250 million bail—desperation mode activated.

The kicker? SBF keeps insisting “I didn’t steal funds,” but the evidence paints a different picture. His once-billion-dollar net worth? Completely dissolved, tied to FTX’s implosion.

Why This Matters

As the industry faces intense scrutiny (Benzinga’s Future of Digital Assets conference this November will dig deep into it), SBF’s case is becoming the poster child for what goes wrong when founders treat customer money like personal ATMs. The playbook: borrow from sister companies, gift it to family, rinse and repeat.

Industry titans from BlackRock to Amazon are watching closely. This isn’t just about one exchange collapsing—it’s about rebuilt trust in crypto infrastructure.