Gary Wang, co-founder of FTX, walked out of a Manhattan courtroom on Wednesday with a sentence of time served, dodging prison time for his part in the collapse of the crypto giant.
U.S. District Judge Lewis A. Kaplan made the call, praising Wang’s swift and decisive cooperation after the FTX empire imploded late last year. Wang’s testimony and tech expertise played a major role in taking down the man behind it all — Sam “SBF” Bankman-Fried.
SBF, who orchestrated the years-long scheme to funnel customer funds into Alameda Research, is serving 25 years in prison. Wang, meanwhile, was described as critical to the investigation. His efforts earned him leniency from prosecutors, who called his contributions “substantial.”
Inside the courtroom: Wang faces the Judge
Wang stood before the judge and apologized, choking back tears. “I am deeply sorry to all the people who were hurt by my actions,” he said, his voice breaking. He admitted to taking what he called “the cowardly path” instead of standing up against the fraud.
His regret wasn’t enough to erase his role in one of the largest financial scandals in crypto history, but it did sway the court. Kaplan acknowledged the weight of Wang’s cooperation, calling it extraordinary.
“I’ve never seen anything quite like what happened here,” he said. Wang actually built a custom software program to help the Justice Department detect fraud in financial markets.
According to prosecutors, this tool is already being used to investigate irregularities in the stock and crypto sectors, with new indictments expected soon.
Prosecutor Nick Roos pointed out that Wang’s assistance went far beyond what was expected. In November 2022, he became the first FTX insider to flip, providing prosecutors with a roadmap to unravel the exchange’s operations.
Roos explained that Wang pinpointed the exact coding method Bankman-Fried used to siphon off billions of dollars. This backdoor allowed FTX customer funds to flow into Alameda, fueling risky investments, luxury properties, and political donations.
What Wang’s testimony revealed
Wang’s cooperation painted a damning picture of FTX’s internal operations. He helped prosecutors decipher the exchange’s code, which was so convoluted it could’ve taken months for experts to figure out.
Prosecutor Thane Rehn said Wang’s insights saved critical time. Without him, the government’s case against Bankman-Fried wouldn’t have been as strong.
Wang’s sentence mirrors that of Nishad Singh, another FTX insider who also avoided prison time last month. Caroline Ellison, however, didn’t fare as well. The former head of Alameda Research, who testified against Bankman-Fried, was sentenced to two years in prison in September.
Meanwhile, Ryan Salame and Caroline Ellison didn’t get off quite as easily. Though their sentences were significantly lower than SBF’s, they failed to convince the courts they deserved to walk away.
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