Will Bitcoin's price surge bail out Sam Bankman-Fried? FTX founder's sentence hinges on crypto's rollercoaster ride

livemint.com:

Bankman-Fried's lawyers have seized upon the skyrocketing prices of various cryptocurrencies and AI assets held by FTX, arguing that this development could mitigate the financial harm caused by their client's actions. They have made a bold claim, stating: “Each victim... will receive 100 cents on the dollar, plus interest." The defence team has argued for a lenient sentence for Bankman-Fried citing the recovery efforts in the aftermath of FTX's collapse.

They assert that victims will eventually be fully compensated, highlighting the recent surge in Bitcoin and other cryptocurrency prices, the FT report said. Bankman-Fried's lawyers contend that the $8 billion shortfall in FTX's balance sheet was merely a temporary setback caused by unprecedented customer withdrawal requests during a rush on FTX in late 2022. They emphasize that victims will receive 100 cents on the dollar, plus interest, bolstered by the increased value of cryptocurrency assets, the report added.

“The harm to customers, lenders, and investors is zero," Bankman-Fried's lawyers wrote to Kaplan last month, arguing for a sentence of no longer than six-and-a-half years. The $8bn hole, they said, reflected “the temporary shortfall in liquid assets to cover the unprecedented level of customer withdrawal requests" during a rush on FTX in late 2022. In stark contrast, John Ray, the caretaker CEO of FTX overseeing the bankruptcy proceedings, offered a more tempered view.

Ray underscored the complexity of victim restitution and the enduring challenges in achieving full economic recovery for all affected parties. Ray contends that even the best-case scenario will not result in a complete restoration of victims' economic positions prior to the fraud. “Mr