Unlikely Redemption: Will Trump Pardon FTX’s Sam Bankman-Fried?

In a whirlwind of political intrigue and market speculation, the cryptocurrency world is abuzz with questions about potential presidential pardons. With former President Trump back in office and already having pardoned notable crypto figures like Binance’s Changpeng Zhao and Silk Road’s Ross Ulbricht, curiosity is mounting: Could FTX founder Sam Bankman-Fried, embroiled in scandal, be next?

The Crypto Pardon Controversy

Trump’s recent decisions have ignited intense debate within the cryptocurrency community. Many see his pardons as a declaration of support for innovation and decentralization. Yet, critics worry these actions might signal an era of unchecked criminality, cloaked in the guise of technological advancement.

The speculation around Bankman-Fried comes as prediction markets, such as Polymarket, experience a surge in activity. In just a few hours, the likelihood of his release soared from a mere 4% to 16%, reflecting a notable shift in public sentiment.

The Crimes and the Characters

Reflecting on past pardons, we see a range of notorious figures:

• Ross Ulbricht: Creator of the dark web marketplace, Silk Road, jailed for life due to drug trades, money laundering, and hacking involvement.

• Arthur Hayes: BitMEX founder who violated banking secrecy laws, faced house arrest and probation.

• Changpeng Zhao (CZ): Binance’s founder, faced brief incarceration for gaps in regulatory compliance.

• Sam Bankman-Fried (SBF): The FTX founder found guilty of misusing billions from customer accounts, charged with telecommunications fraud, and sentenced to 25 years in prison.

While all these figures have had significant legal challenges, SBF’s case stands out due to the sheer scale of fraud and its international impact.

The Political Maze

The Political Divide

SBF’s political engagements complicate his case further. Once a significant donor to Democratic causes, this could deter Trump, who values loyalty fiercely, from offering clemency. Pardoning a former opponent’s supporter could alienate his base and hinder his outreach efforts.

The Public Perception and Legacy of Damage

SBF’s notoriety is compounded by his unyielding stance in court and the extensive fallout from FTX’s collapse. Unlike other figures who maintained low profiles, SBF’s denial and the widespread financial harm painted him in a particularly unsympathetic light.

With investors and financial institutions burned by FTX’s downfall, granting him clemency could exacerbate criticisms against Trump for aligning with scandal-plagued figures.

The Verdict on SBF’s Prospects

Despite the buzz, practical and political realities suggest that a pardon for SBF remains unlikely. His complex political associations, the magnitude of his crimes, and his tarnished public image present significant barriers.

It would take considerable political risk for Trump to extend a pardon in this case, pushing the boundaries of any crypto-friendly stance he might wish to project. For now, it seems SBF’s path to pardon is closed.

This analysis was inspired by discussions around Trump’s recent pardons and the outlook on further clemency in the crypto sphere.