Sam Bankman-Fried, the alleged crypto grifter, is about to learn which of two profoundly divergent paths he'll take on the road to trial.
One path allows him to continue his house arrest in the comfort of his parents' California home. The other lands him in a jail cell.
Judge Lewis Kaplan is expected to rule as early as Friday afternoon on prosecutors' request to revoke Bankman-Fried's bail after they accused him of trying to intimidate witnesses in the run-up to his trial.
If his bail is revoked, Bankman-Fried will be immediately remanded to a notorious federal detention center in Brooklyn. A former warden at the jail, called the Metropolitan Detention Center, told the New York Times in 2019 that it "was one of the most troubled, if not the most troubled facility in the Bureau of Prisons."
His lawyers have argued against revoking bail, saying they would agree to a gag order that would limit Bankman-Fried's contact with individuals outside of the case.
Bankman-Fried, who has pleaded not guilty to multiple conspiracy and fraud charges, is set to go to trial in October.
The charges stem from what prosecutors have characterized as one of the biggest financial frauds in US history. Bankman-Fried allegedly orchestrated a massive scheme, stealing deposits from his cryptocurrency exchange FTX to finance risky bets at his hedge fund, funnel contributions to American politicians and underwrite a luxury lifestyle for himself and his employees in the Bahamas.
Witness-tampering allegations
Prosecutors say Bankman-Fried has repeatedly sought to tamper with witnesses in violation of the terms of his bail, and they believe there are no conditions for release that can adequately "assure the safety of the community."
Prosecutors point to a series of actions taken by Bankman-Fried, including contacting potential witnesses against him, using a virtual private network to subvert monitoring, and speaking with a reporter about former FTX executive Caroline Ellison, who has pleaded guilty and will testify against him.
Bankman-Fried's attorneys argued that he has a right to defend himself and to speak with reporters.
Before its collapse, FTX was one of the largest crypto trading platforms in the world, backed by A-list celebrities and featured in Super Bowl commercials. But the company came unglued in the span of a week last November — as concerns about its financial ties to Bankman-Fried's crypto hedge fund, Alameda Research, spurred investors and customers to yank their funds. The company filed for bankruptcy and quickly became the center of the federal fraud investigation.
