Sam Bankman-Fried will be allowed to use a non-internet-connected flip phone under new bail conditions that include restrictions on internet usage, according to prosecutors cited by Bloomberg.
The former FTX CEO is still free on a $250 million bail but is being held at his parents’ home with an ankle monitor. Prosecutors stated in a letter to U.S. District Judge Lewis Kaplan late Friday that the parties had agreed to changes in the terms of Bankman-Fried’s release.
Did Sam Bankman-Fried Try To Contact Witnesses?
According to Bloomberg, the request was submitted before Kaplan of the Southern District of New York courthouse in response to accusations that Sam Bankman-Fried tried to contact witnesses.
Additional limitations include not contacting current or former FTX or Alameda Research trading arm staff other than direct family members unless accompanied by a lawyer. He is also unable to use encrypted or ephemeral call or messaging apps.
Sam Bankman-Fried. REUTERS/Andrew Kelly/File Photo
Bankman-Fried’s laptop will also be limited to a whitelist of allowed websites. In a filing, U.S. Attorney Damian Williams stated that his usage of video games and other related applications should be banned as well.
He is also not permitted to use a virtual private network, or VPN, on his phone, which encrypts internet traffic and conceals a user’s identity.
Last month, Kaplan prohibited Sam Bankman-Fried from using VPNs after his lawyers claimed he used one to watch football.
FTX Collapse And Aftermath
The collapse of FTX occurred over a 10-day period in November 2022. The trigger was a Nov. 2 report by crypto news site CoinDesk, which revealed that Bankman-Fried’s trading firm, Alameda Research, maintained a $5 billion position in FTT, the native token of FTX.
According to the report, Alameda’s investment foundation was also funded in FTT, the token created by its sister firm, rather than a fiat currency or any cryptocurrency.
This sparked widespread alarm in the cryptocurrency industry about his companies’ unreported leverage and solvency.
Bankman-Fried resigned as CEO of FTX on Nov. 11, and was replaced by court-appointed John Ray, who previously led energy trading major Enron through bankruptcy procedures.
Bitcoin (BTC) total market cap at $431 billion on the weekend chart | Chart: TradingView.com
The following day, FTX filed for Chapter 11 bankruptcy protection, revealing that around 130 other connected entities were also involved in the process. According to the bankruptcy filings, FTX had assets and liabilities between $10 billion to $50 billion.
Bankman-Fried is accused of orchestrating a major scam that resulted in FTX’s demise in November. In extensive public statements, he took full responsibility for the disaster but claimed he did nothing wrong and pleaded not guilty.
-Featured image from KCUR