US appeals court upholds Sam Bankman-Fried’s FTX fraud conviction
The 2nd U.S. Circuit Court of Appeals upheld Sam Bankman-Fried’s 2023 fraud and conspiracy conviction, leaving in place the 25-year prison sentence imposed after FTX’s collapse. The appeals court found that the trial was not unfair and that the prosecution’s evidence supported the jury’s verdict. Bankman-Fried had argued that trial rulings and jury instructions prevented him from presenting his defence properly, but the panel rejected that challenge. The decision does not end all legal avenues: he could seek rehearing or ask the U.S. Supreme Court to take the case, and his separate clemency effort remains a political route rather than a judicial one. For European readers, the ruling lands after the EU’s Markets in Crypto-Assets Regulation became fully applicable, reinforcing why regulators moved to bring crypto platforms, custody and disclosures closer to conventional financial-market oversight.
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About this story
Sam Bankman-Fried (American entrepreneur, born 1992, co-founder of FTX) became one of crypto’s best-known executives before his conviction. FTX (Bahamas-based cryptocurrency exchange founded in 2019) collapsed in November 2022 after a liquidity crisis exposed misuse of customer assets. Alameda Research (crypto trading firm co-founded by Bankman-Fried in 2017) was FTX’s affiliated trading arm and central to the prosecution case. The 2nd U.S. Circuit Court of Appeals (federal appellate court in Manhattan covering New York, Connecticut and Vermont) reviewed the fairness of the trial. Judge Lewis A. Kaplan (U.S. district judge in Manhattan) presided over the 2023 trial and imposed the 2024 sentence. Barrington D. Parker (U.S. circuit judge) wrote the appeals panel’s opinion. The Markets in Crypto-Assets Regulation, or MiCA (EU Regulation 2023/1114, adopted in 2023 and fully applicable from December 2024), sets EU rules for crypto-asset issuers and service providers.
How to read this story
The history
FTX filed for bankruptcy on 11 November 2022 after customers rushed to withdraw funds and the exchange could not meet demands. Bankman-Fried was convicted on 2 November 2023 and sentenced on 28 March 2024. The case followed earlier financial-fraud precedents in which charismatic founders and complex products obscured basic customer-asset misuse, including Enron’s 2001 collapse and Bernard Madoff’s 2008 Ponzi-scheme exposure. A 2023 research paper by David Vidal-Tomás, Antonio Briola and Tomaso Aste found that FTX’s failure also exposed fragility and centralisation within supposedly decentralised crypto markets.
Why now
The story is timely because the 2nd U.S. Circuit Court of Appeals issued its decision on 12 June 2026, closing Bankman-Fried’s first major attempt to overturn the conviction and sentence imposed after the FTX trial.
What to watch
The next signals are whether Bankman-Fried files for rehearing, petitions the U.S. Supreme Court, or continues pursuing executive clemency. In Europe, watch how national supervisors apply MiCA to exchanges, custodians and cross-border crypto marketing.
Local impact
The most concrete Belgian impact is for retail investors and compliance teams in Belgium’s financial sector, especially firms seeking or assessing crypto services under MiCA. Brussels-based EU and Belgian regulators will read the case as another example of why custody, conflicts of interest and marketing claims need enforceable supervision.
International angle
The case links a U.S. criminal prosecution, a Bahamas-based failed exchange and EU regulatory reform. FTX’s global reach meant the fallout was not confined to American investors, while MiCA now makes the EU one of the main jurisdictions trying to convert crypto-market lessons into a common supervisory framework.
What this means for you
Belgian and EU readers using crypto platforms should distinguish between market risk and custody or governance risk. MiCA authorisation can improve transparency and supervision, but it does not make crypto assets safe or guarantee repayment. Investors should check who holds assets, which legal entity serves them, and which regulator supervises that provider.
What happens next
Bankman-Fried could ask the full appeals court to rehear the case or petition the U.S. Supreme Court, though neither route guarantees review. His separate clemency application, if pursued, would sit with the U.S. executive branch rather than the courts. In Europe, the practical follow-up is continued MiCA implementation by national supervisors and EU authorities.
Potential consequences
The ruling may make it harder for Bankman-Fried to reframe the case as a trial-process failure, although further appeals remain possible. For the crypto sector, it reinforces the divide between regulated providers seeking bank-like legitimacy and platforms built around offshore governance, affiliated trading firms or opaque custody. Belgian consumers may see more providers emphasise MiCA authorisation as a trust signal, but that should not be read as a guarantee against losses.
Opposing perspectives
- Appeals court panel
The court’s strongest frame is that this was a conventional fraud case with a sufficient trial record, not a referendum on crypto innovation. The panel found the evidence supported the jury’s verdict and rejected the argument that trial management or jury instructions denied Bankman-Fried a fair opportunity to defend himself.
- Bankman-Fried defence team
The defence frame is that the trial narrowed the story too much and prevented jurors from hearing evidence that could support a less criminal interpretation of FTX’s collapse. Bankman-Fried’s side has argued that FTX’s structure, solvency claims and legal advice were not fairly presented to the jury.
- EU financial regulators
The regulatory frame is that FTX showed why crypto platforms handling customer assets need clear authorisation, governance, disclosure and custody rules. MiCA does not erase investment risk, but it gives EU supervisors a common basis for policing crypto-asset service providers and reducing regulatory arbitrage.
Timeline
- 2019-05·FTX began operating as a cryptocurrency exchange.
- 2022-11-11·FTX and related entities filed for bankruptcy.
- 2023-11-02·A U.S. jury convicted Bankman-Fried on fraud and conspiracy counts.
- 2024-03-28·Judge Lewis A. Kaplan sentenced Bankman-Fried to 25 years in prison.
- 2024-12-30·MiCA became fully applicable for crypto-asset service providers in the EU.
- 2026-06-12·The 2nd U.S. Circuit Court of Appeals upheld the conviction and sentence.
Glossary
- MiCA
- The EU Markets in Crypto-Assets Regulation, a single-market rulebook for crypto-asset issuers and service providers.
- FSMA
- Belgium’s Financial Services and Markets Authority, the national conduct supervisor for financial markets and many investor-protection rules.
- Crypto-asset service provider
- Under MiCA, a business authorised to provide services such as custody, exchange, trading-platform operation or crypto transfer services.
- Executive clemency
- A U.S. presidential power to grant pardons or sentence relief in federal criminal cases.
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This briefing was prepared with AI assistance and reviewed by a Belgium Impulse editor before publication. methodology.