Bankman-Fried Loses Again As Court Denies Request For Release As His Team Appeals Conviction

Sam Bankman-Fried, the disgraced founder of now-defunct crypto exchange FTX, once again faced a major setback as a U.S. appellate court denied his bid for release while his team of high-profile lawyers scrambled to appeal his conviction.

Bankman-Fried can thank his lucky stars for his meteoric rise in the cryptocurrency industry as billions of dollars flowed into Alameda Research, the crypto hedge fund he founded, and the crypto derivatives exchange FTX, both of which are now bankrupt. But, he seems to have run out of luck since the start of this year.

Aside from his immediate extradition from the Bahamas to the U.S. late last year, the former crypto billionaire, who was once regarded as the "golden boy" of crypto, was sent to jail in August after a judge revoked his bail over alleged witness tampering.

A few months later, a jury found the 31-year-old MIT graduate guilty on all seven counts of criminal fraud. His sentencing is scheduled for April 2024.

Bankman-Fried and his team of expensive lawyers previously filed an appeal to the court for the crypto mogul's "release pending trial and for immediate release pending disposition of this appeal."

But, in a rather belated ruling Tuesday, the U.S. Court of Appeals for the Second Circuit upheld the decision to keep him in detention. The court said Bankman-Fried's previous attempts to tamper with two witnesses while on pre-trial release was the major reason behind rejecting his request.

While the former crypto kingpin's camp argued that the New York District court failed to consider that his activities were part of his freedom of speech, which is protected by the First Amendment, the appellate court upheld the decision, saying witness tampering "falls outside the zone of constitutional protection."

"We review a district court's detention ruling deferentially and reverse only for clear error," the appellate court said in its decision. "We discern no error, much less clear error, in the district court's detention decision."

"The record supports the district court's conclusion that there was probable cause to believe that the defendant-appellant attempted to tamper with two witnesses in violation of 18 U.S.C. 1512(b), and specifically that he acted with unlawful intent to influence those witnesses," the court added.

The appellate court also said, "We have reviewed the defendant-appellant's additional arguments and find them unpersuasive. Upon due consideration, it is hereby ordered that the motion for release pending trial is denied. The motion for immediate release pending disposition of this appeal is denied as moot."