Ep. 99: SBF Trial Briefing, November 3. He's Guilty.

[00:00] *Sigh* [00:02] Thank you. [00:03] Closure. Day. [00:07] Hey, Natasha, what is crypto to you? Crypto is so much more than charts and gains. It's a whole new financial system, entirely new technological rails to enable creativity, ownership, wealth building, and more. Free of credit scores and spending habits, Kraken is your easy-to-use, newbie-friendly bridge to this whole new world. Everything can be better, so why not finance? To get started, go to kraken.com backslash boys club, sign up in just a few minutes, and see what crypto can be. [00:36] of loss. Cryptocurrency services are provided to US and US territory customers by Payward Ventures Incorporated. PVI, DBA, Kraken. Hi. Hey. SBF, we have a decision. The man is guilty, guilty, guilty, guilty. He's in big trouble. We're breaking the story. 14 hours later. I mean, everyone has surely seen the news. So that's not, hopefully you're not, I mean, if you're hearing it for the first time. [01:04] He's guilty on all seven counts. On all seven counts at 745 ish last night. [01:10] The verdict was read. The jury found SBF guilty on all seven accounts, including wire fraud, conspiracy to commit wire fraud and conspiracy to commit money laundering. Those are the three main buckets in seven different charges. Many would say justice is served. Justice is beginning to be served, I think. I think the timeline of the case and how it came together and how quickly the jury deliberated, I think, is...

[01:35] interesting. So they spent one month in trial and the jury took four and a half hours to come to a decision after it wrapped up. I don't know what the terminology is, but that's quick. [01:47] It's incredibly quick. It's basically like unprecedentedly quick. It's very, very, very fast. So for some context, the Holmes case, the jury deliberated for seven days and she had four counts. [02:17] through each one of those, look at the evidence and decide whether you unanimously agree in the federal courts, it has to be unanimous that this person is guilty and you go through each charge. And they were like, immediately, yes. Basically, four and a half hours means all they were able to do was say immediately. Yes. Seven times as a group of jurors. [02:36] So it just proves how airtight the government's case was against SBF. The vibe in the courtroom... [02:43] was somber as the decision was read out. The judge told SBF to stand and to face the jury as they read their decision. And then they went through and said, count one, guilty. Count two, guilty. Count three. And that's dramatic. It's dramatic. And that's sobering. And the courtroom was packed after it was read aloud. His parents, Barbara Freed, and his father, Joe Bankman,

[03:11] were head in hand, sort of stifling tears, left arm in arm, [03:17] They were separated from SBF by the barrier of the courtroom. And as he was leaving the courtroom, sort of turned and nodded at his parents as he left the courtroom. So this is a human being. There's some sadness for sure around the fact that this man is probably going to spend the rest of his life in prison. But he... [03:36] made that decision in many, many, many times over. And I think what we heard very clearly from the prosecutor in their closing arguments was... [03:44] that he had many times where he could have made the right decision, even after he had made a bad decision. And he continually chose [03:53] to lie and deceive and to choose [03:57] his best interest over doing the right thing. And I think that they clearly showed that in their evidence and in the case that they brought against him. And so, like, there was a part of me that I felt sympathetic to him and his family last night, which is very strange because I think he's absolutely guilty and I think he did terrible things and I don't think that he's necessarily a good person. But I do think it's... [04:17] horrible to see someone's life completely ruined and many people's lives completely ruined. [04:23] On that note, sentencing won't happen until March 28th of next year. So there's quite a ways to go. There's another case that will be brought against him. There's expected to be appeals. So it's over in a sense, but it's also not over in a sense as well. Oh my God. I think it's over for us. I think it's over for us. Saves the timeline.

[04:53] It's expected that he's going to get many decades in prison. For context, Bernie Madoff got 150 years sentence, which was the maximum sentence. Of course, he died in prison. He did a $65 billion fraud. So it is orders of magnitude bigger. But they made an example of him. And it's expected that they'll make an example of Sam as well. [05:16] Yeah, for context, the Bernie Madoff [05:18] sentencing was... [05:21] the largest white collar sentences of all time. So that's like the high bar. So we'll see if SBF gets past that bar. His other charges, so essentially how it works is many times... [05:32] the prosecutors and the government once they get a guilty verdict on... [05:37] the first case that they brought, which is this case of the seven counts. Sometimes they won't charge the second case because essentially it's like, [05:44] He could just end up spending his life in prison or he'll get such a large sentence that [05:49] all of the work that... [05:51] And resources that's required for the government to put that case together, they have to sort of weigh out if it's sort of quote unquote worth it. They're just like, never mind. That's kind of odd to me, but that's cool. Well, I mean, think about how much money the government is spending on having all of those people create that case. Totally. When he might spend his life in jail anyway. But part of that case includes campaign finance. [06:11] violations. And so because of that, sometimes there's chatter on the street that they will charge it because it's such a touchy and important... [06:23] lol I guess I don't know so that's a big question mark a few closing thoughts for me around this I'm dying to know what a sentence will be that's

[06:32] Definitely top of mind because he breached his bail terms. He went back to prison last night and he will... [06:40] be serving in prison until he goes up for his sentencing. So such a stupid thing. If he had not done that, there's, what did he do? There were several things that he did. One was like using a VPN and, uh, [06:55] certain things on that he was not supposed to do on the internet basically that was proven that he was doing and then he was trying to get in touch with caroline which is witness tampering so he was also there was evidence that he was witness tampering so he lost his ability to be not in prison before the trial started and then also now there would have been a big chance that he could have been sitting at home with his parents until march dude just thinks he's above rules and i [07:25] Actually, everything I said about having empathy for him, gone. [07:29] So closing thoughts here. I thought that the prosecutor's closing arguments, there's a line in here that was really... [07:35] for me someone who works in crypto really touched on the core of the matter he said this is not about complicated crypto terms it's about deception it's about lies it's about stealing it's about greed and i think that they really beautifully [07:49] in their closing arguments. [07:50] gave the jury [07:52] an understanding of this is actually a very cut and dry story about someone who thought the rules did not apply to them and acted irresponsibly and in their own best interest and with greed and

[08:04] use lies and stealing to do it. And that's the story here. It's like, yeah, some of the mechanisms are crypto, but they're actually not even crypto. It's just a very straightforward story about fraud. [08:15] message would permeate. [08:18] Mm-hmm. Because it's very easily a story about crypto and that feels unfair. Totally. I think also there was this discourse going around last night where it was like, don't celebrate this case. And even I think some shade thrown at folks like us where you're like, you're giving... [08:36] him too much airtime. Like we shouldn't be talking about Sam. We shouldn't be talking about this. Just a brief message to our haters here. I actually think that the social shaming of Sam Bakeman Freed is really healthy and it's really useful. Have you ever heard the psychology of gossip being useful in social groups where it's a way to like instill norms and to show what behavior is acceptable to a certain group and what behavior is unacceptable to a certain group. [09:06] what I feel around the shaming of Sam Bankman Freed. It's a tool. We're showing everyone that that is not okay. And you're going to be socially shamed if you behave in that type of way. And I think that we should be talking about it as an industry. And I think that we should be showing [09:24] that it's not okay. And so, [09:27] I just want to [09:29] say that for the record, because I saw a lot of takes that I was like, we shouldn't be talking about it. Like, that's crazy. We need to, we need to put daylight on it so that it doesn't happen again.

[09:38] Yeah, and it's like, this is a bad actor, and you will get absolutely fucking roasted if you act like this. Two other interesting... [09:45] Twitter. [09:46] moments that I [09:48] in bed on my phone, unable to let this thing go last night, witnessed. One was Alfred Lynn, who is a partner at Sequoia. [09:59] He... [10:00] put some tweets out that were interesting. [10:02] And sort of gave some insight into the experience of the investors, what it's been like for them. And he said, today's swift and unanimous verdict confirms what we already knew. SPF misled and deceived so many from customers and employees to business partners and investors, including myself and Sequoia. [10:21] Next tweet. Immediately after FTX collapsed, we extensively reviewed our due diligence process and evaluated our 18 month working relationship with SBF. We concluded that we had been deliberately misled and lied to. In the last year, we have had to remain quiet while the prosecutor built its case. And through the trial period, we are pleased that the trial is over. [10:41] And... [10:43] Thank you. [10:43] I don't know. Something about that was... [10:46] Just... [10:47] say what you want about Sequoia. There's many takes on that. But I do think [10:52] It just brings it back home to... [10:54] totally customers, even more so than anybody in the world. But how many people, individual, actual people were deceived and lied to and had personal relationships with this person. And that makes it come to life in a way that I think is hard to look away from. Totally. Okay, well, we're gonna have to boot up a new personality now that this trial is over. Okay. Well, thanks for being with us throughout it. And I hope you learned something about the

[11:24] the government in the United States of America. [11:27] And I hope that it was useful in some way. Keeping up on the news of the day and time to... [11:34] Start fresh. Time to build. Back to regular scheduled programming next week. Okay, bye. Thanks, everyone. Bye. When you're first getting started with crypto, it can be scary. Am I doing this right? Is this just like my bank or trading app? How is it new and different? Well, that's why we love Kraken. They have a 24-7, 365 customer support team that's there to hold your hand all along the way. This isn't a 9-to-5 Monday to Friday bank. This is crypto. It's all the time. Anyone's welcome. Open door policy. Come one, come all. [12:04] Not investment advice. Crypto trading involves risk of loss. Cryptocurrency services are provided to U.S. and U.S. territory customers by Payward Ventures Incorporated, PBI, DBA, Kraken.