Casey Wagner

Nishad Singh, former director of engineering at FTX, has been sentenced to time served with three years of supervised release for his role in the exchange’s collapse. He will not serve any prison time.



Singh, who was a government witness in FTX founder Sam Bankman-Fried’s criminal trial last fall, in February 2023 pleaded guilty to six charges, including conspiracy to commit money laundering and conspiracy to commit campaign finance violations.&nbsp;



His lawyers earlier this month asked the court to sentence Singh to no prison time.&nbsp;



“I’m not foolish enough to think there was no self interest involved, obviously,” Judge Lewis Kaplan told Singh of his cooperation. “But you did the right thing.”&nbsp;



Singh’s parents, fiancé and numerous extended family members and friends filled the gallery Wednesday afternoon. After handing down his sentence, Kaplan addressed Singh’s parents.&nbsp;



“This is purely personal,” he said. “I don’t see anything you did wrong.”&nbsp;



Singh’s mother mouthed “thank you” to Kaplan in response.&nbsp;



The guideline sentencing for Singh’s offenses and criminal history suggested 75 years in prison, court filings show. Kaplan on Wednesday told Singh that his cooperation was “remarkable.”&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Judge Kaplan: Your cooperation has been remarkable. You are a very important cooperator. It has contributed to an appropriate outcome all around. Caroline Ellison got credit, but you deserve more. I sentence you to time served, 3 years supervised release&mdash; Inner City Press (@innercitypress) <a href="https://twitter.com/innercitypress/status/1851715916553437315?ref_src=twsrc%5Etfw">October 30, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Prosecutors in a letter to the court last week emphasized Singh’s “exemplary cooperation” that contributed to the “successful prosecutions” of Bankman-Fried and former FTX Digital Markets CEO Ryan Salame.&nbsp;



Read more: <a href="https://blockworks.co/news/sam-bankman-fried-final-statement-sentenced">SBF’s ambitions went too far, judge says when handing down 25-year sentence&nbsp;</a>



<a href="https://blockworks.co/tag/sam-bankman-fried">Bankman-Fried</a> is currently serving a <a href="https://blockworks.co/news/sam-bankman-fried-sentenced">25 year sentence</a> after being convicted of two counts of wire fraud, two counts of conspiracy to commit wire fraud, one count of conspiracy to commit securities fraud, one count of conspiracy to commit commodities fraud and one count of conspiracy to commit money laundering.&nbsp;



Salame is currently serving a <a href="https://blockworks.co/news/former-ftx-exec-ryan-salame-sentenced">7.5 year sentence</a> after he pleaded guilty to two counts of campaign finance violations and operating an unlicensed money-transmitting business. Salame entered his guilty plea just ahead of Bankman-Fried’s jury trial but did not serve as a witness for either the defense or prosecution.&nbsp;&nbsp;&nbsp;



Singh’s sentencing comes roughly a month after former Alameda Research CEO Caroline Ellison was sentenced to <a href="https://blockworks.co/news/caroline-ellison-sentenced-to-24-months">24 months in prison</a>. Ellison in December 2022 pleaded guilty to seven federal counts and served as a key witness in Bankman-Fried’s 2023 trial. Prosecutors had requested Ellison serve no jail time in exchange for her “extraordinary cooperation.”&nbsp;



<a href="https://blockworks.co/tag/caroline-ellison">Ellison</a> deserved leniency for her cooperation, Kaplan told the court Wednesday, but Singh “deserved more.”&nbsp;



FTX co-founder Gary Wang, who also testified against Bankman-Fried, is scheduled to be sentenced next month. Wang in 2022 pleaded guilty to four counts of fraud and conspiracy in December 2022.



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Caroline Ellison

Ex-FTX engineering head avoids prison, sentenced to 3 years supervised release

Katherine Ross

Michelle Bond, the partner of former FTX executive Ryan Salame, was charged with violating campaign finance laws on Thursday.&nbsp;



Back in 2022, the Department of Justice alleged, Bond launched a campaign for a seat in the US House of Representatives.&nbsp;



She and Salame “orchestrated a sham consulting agreement between Bond and the exchange [FTX] pursuant to which Bond was paid $400,000. Bond then used that money to illegally finance her campaign. Further, between June and August 2022, [Salame] wired hundreds of thousands of dollars to Bond’s personal bank account, which Bond then used to illegally fund her campaign,” the DOJ’s <a href="https://www.justice.gov/usao-sdny/pr/former-congressional-candidate-charged-violating-campaign-finance-laws">press release</a> said.



Salame, late Wednesday, filed to void his guilty plea after claiming that officials had gone back on their deal not to pursue an investigation against Bond.&nbsp;



“Yet the Government failed to abide by its word, recently resuming its investigation into Bond and pursuing an indictment against her,” lawyers representing Salame said. 



The government, in response to Salame, asked Judge Lewis Kaplan — who also oversaw the Sam Bankman-Fried trial — to reject Salame’s filing.



“Salame resorts to inaccurate, incomplete, and outright false assertions in an effort to evade his serious sentence for his involvement in an illegal campaign finance scheme that was unprecedented in scale, and for his role in funneling billions of dollars through an unlicensed money transmitting business,” the government’s lawyers wrote.



The lawyers said that any claim made by Salame that the government agreed to drop an investigation into Bond is “demonstrably false.”



Salame is due to start a prison sentence of seven and a half years in October, after getting the date pushed back.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">It&#39;s all true but I just made a court filing I&#39;m pretty nervous about because I know it means the most powerful body in the world is going to come at me and my loved ones again, but I&#39;m hoping it encourages more people to be honest and tell the truth and expose un-American…&mdash; Ryan Salame (@rsalame7926) <a href="https://twitter.com/rsalame7926/status/1826362919128387810?ref_src=twsrc%5Etfw">August 21, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Bond was charged with “one count of conspiracy to cause unlawful campaign contributions; one count of causing and accepting excessive campaign contributions; one count of causing and receiving an unlawful corporate contribution; and one count of causing and receiving a conduit contribution.”



Each count carries a maximum sentence of five years in prison.&nbsp;



“As alleged, Michelle Bond and her co-conspirator romantic partner attempted to fund her campaign for the U.S. House of Representatives by illegally using hundreds of thousands of dollars from corporate coffers, among other sources, and then lying to Congress and others to cover it all up,” US attorney Damian Williams said. 



Bond, outside of Salame, has her own ties to the crypto industry. Back in June, she <a href="https://www.prnewswire.com/news-releases/digital-future-launches-to-advance-the-digital-economy-302177968.html">launched</a> Digital Future, a “public policy and advocacy think tank” focused on crypto, fintech and AI.



Salame is one of a handful of FTX executives facing jail time after the collapse of the exchange. FTX CEO Sam Bankman-Fried faced a trial late last year where a jury found him guilty on all counts. Bankman-Fried was sentenced earlier this year to 25 years in prison.



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DOJ charges former FTX exec’s partner with campaign finance violations

After nearly two years of silence, former FTX executive Ryan Salame seems to have just remembered his X account password. Or maybe, he’s no longer worried about the consequences.&nbsp;



Either way, Salame’s got a classic case of the Twitter fingers and has been quite active on social media.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">hot damn, this is going to get interesting quickly&mdash; Ryan Salame (@rsalame7926) <a href="https://twitter.com/rsalame7926/status/1795529743179354461?ref_src=twsrc%5Etfw">May 28, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



His first post, while cryptic, seemed to imply that Salame is ready to talk about his time at the now infamous (and bankrupt) exchange.&nbsp;



And maybe he is. After all, he’s set to report to prison in late August to <a href="https://www.justice.gov/usao-sdny/pr/former-ftx-executive-ryan-salame-sentenced-90-months-prison">serve</a> a seven-and-a-half-year sentence.&nbsp;



Read more: <a href="https://blockworks.co/news/former-ftx-exec-ryan-salame-sentenced">Former FTX exec Ryan Salame sentenced to 7.5 years, above government ask&nbsp;</a>



Earlier this week, Salame was the first of the FTX insiders (aside from Sam Bankman-Fried) to face sentencing, and Judge Lewis Kaplan — who also oversaw the <a href="https://blockworks.co/tag/sbf-trial">trial</a> and sentencing of SBF — didn’t go easy. Kaplan’s sentencing exceeded the prosecutor’s recommended five to seven years.&nbsp;



Of all of the insiders to cut deals with prosecutors, <a href="https://blockworks.co/tag/ryan-salame">Salame</a> has been very quiet. His former colleagues Caroline Ellison, Gary Wang and Nishad Singh were all present at <a href="https://blockworks.co/tag/sbf-trial">Bankman-Fried’s trial</a>. The trio gave insight into how Bankman-Fried operated <a href="https://blockworks.co/tag/ftx">FTX</a> and Alameda, and what the downfall looked like from the C-suite.&nbsp;



Salame wasn’t present back at the November trial, though prosecutors <a href="https://blockworks.co/news/former-ftx-exec-ryan-salame-sentenced">said</a> he handed over some information prior to its start. Not enough, however, they added, to make a sizable difference.&nbsp;



But we don’t really know what was shared back then, and we don’t have Salame’s perspective from the final days of FTX. Bits and pieces of Salame’s side have trickled in through memos to the court from his team, prosecutors and witness letters like the one I mentioned in a previous Morning Riff from his good friend and former colleague, Sam Trabucco.&nbsp;



Salame’s final tweet — before it all went south — indicated that nothing was wrong. Though in all fairness, it wasn’t as bad as SBF’s infamous “assets are fine” tweet.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">It’s so powerful learning who your friends are! Very excited to grow with them in the long term. It’s not hard to genuinely figure out who cares about customers and who doesn’t if you look past the insanity&mdash; Ryan Salame (@rsalame7926) <a href="https://twitter.com/rsalame7926/status/1589428620766097408?ref_src=twsrc%5Etfw">November 7, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



After his sentencing, Salame admitted that he’s “cringed reading it nearly every day” since the <a href="https://blockworks.co/news/ftx-meltdown-timeline">November 2022 collapse</a>.



Even before Salame admitted that his tweet was “terrible,” Salame posted about a media interview in what seems to be him opening the door for his narrative.



Though he’s teased a couple of details already, like his claim that he didn’t know about the $55 million loan.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">The 55m loan everyone keeps citing, I had no idea about it until after ftx collapsed. Not a dollar ever touched my account and the receiver had no clue I didn&#39;t know about it. Fun thing to learn while my whole world was imploding.&mdash; Ryan Salame (@rsalame7926) <a href="https://twitter.com/rsalame7926/status/1795619019279786121?ref_src=twsrc%5Etfw">May 29, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



There’s still a lot we don’t know.



We’ve heard bits and pieces from Singh about <a href="https://blockworks.co/news/breaking-sam-bankman-fried">the political donations</a>, and Salame could, theoretically, offer some more insight into them. In legal filings ahead of the sentencing, his team also said that he was the “first person” to tell Bahamian authorities about FTX’s fraud.



Overnight, Salame seemed to point to possibly authoring a book — though not on the subject of FTX — when he asked X, “Can someone make a book of the best memes for the next few years and sell it on Amazon. Asking for a…”



Now, whether Salame’s looking to get a book deal about memes or testing the waters for a potential tell-all about the downfall is unclear.



Salame’s publicly admitted that going to prison is “like being alive for your own funeral” and he seems to be bitter that he didn’t sell off his crypto holdings instead of “listening to multiple lawyers and borrowing from Alameda against it” so we’ll see how he approaches the next few months — and the seven years after that.



But it’s only fair to point out that Salame’s not the only crypto executive to take up writing either during or before a prison stint, as former Binance CEO Changpeng Zhao also <a href="https://x.com/cz_binance/status/1789503928909894130?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1789503928909894130%7Ctwgr%5Eb8148193185a5afda8e18c631f8f089f031a3e63%7Ctwcon%5Es1_&amp;ref_url=https%3A%2F%2Fdailycoin.com%2Fformer-ceo-turned-author-binances-cz-teases-whats-next%2F">teased</a> a potential book earlier this month.



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Former FTX executive Ryan Salame hints at possible book 

David Canellis

<h2 class="wp-block-heading">Pick-me coins</h2>



They say you should sell shovels during a gold rush.&nbsp;



Pump.fun, the Solana memecoin generator, has certainly nailed that strategy. So much so that minting a personalized token on the platform is now, apparently, a rite of passage for celebs.



Over the past four days, Caitlyn Jenner’s X account has nonstop bullposted about her own token, $JENNER, which her team launched on Pump.fun earlier this week.&nbsp;



The videos are strange and surreal, leading to some <a href="https://www.youtube.com/watch?v=vLhtRxIsXF4">speculation</a> that Jenner’s account had been compromised with deepfakes, all to pump and dump an unofficial memecoin.&nbsp;



Iggy Azalea confused the matter by launching her own memecoin, MOTHER, amid the hype. She also <a href="https://decrypt.co/232927/celeb-crypto-handler-380k-fake-iggy-azalea-meme-coin">outed</a> an alleged scammer who had purportedly hustled the rapper, Jenner and other celebs with dodgy memecoin schemes.



Still, the general consensus is that Jenner’s videos are real and this whole thing is perhaps her publicist’s way of latching onto Trump’s recent endorsement for crypto. She <a href="https://x.com/Caitlyn_Jenner/status/1795973191325585733">launched</a> an Ethereum version of $JENNER earlier this morning.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-us.googleusercontent.com/s66h5kYYWOSuqpww85GA8WKRVoMvk13brf6AajE5SJNsWkrLcSHbdW_KhDzt_axAw5e4FHRXlM6aHExR3FHVLbP954Jtg6cbjMySE0Ijx0kBe4CCAvqDd3bw7I4i4ScXU-Rzf3U7iQmuUotiBFA6__Y" alt=""/></figure>



Combined with singer-songwriter Davido’s <a href="https://x.com/davido/status/1795911220505043388">memecoin</a>, as well as short-lived fake $IGGY memecoin from the alleged scammer, the tokens have seen about $400 million in trade volume over the past four days.



JENNER surged to as much as $43.6 million shortly after it first traded and has since sunk by more than 85%. Iggy’s is following a similar trend but the volatility could continue for some time.



It’s not easy to determine how much money Jenner or Azalea have made by trading their memecoins. But it’s really Pump.fun that has found product-market fit.



More than three-quarters of a million tokens have been deployed through Pump.fun, and the platform takes a 1% fee on trades and a small amount of SOL when memecoins make it to live trading on Raydium.&nbsp;



Right now, that’s converting to seven-figure fee revenue per day, with yesterday setting a new record of $1.47 million SOL, compared to the previous top of $1.2 million earlier this month.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-us.googleusercontent.com/6cA5yyaD-nwDnzow8MfYObHx37uU_eRUAy9VlwbFImZKXyviXm5Wjgj5m6xqsMpdGXB_3MpAwwEhsH7JmuB8qRShNNljz6gxFXPXSF2qEEwjy8umvXSe2Uz-aIWKR-7AYzXpByI0CmRC3npbhqTg96E" alt=""/></figure>



Overall, Pump.fun has brought in nearly $28.9 million in SOL fees since it launched in January, based on a daily tally, which is more than the market cap of JENNER, MOTHER and DAVIDO combined.&nbsp;



How much of that is real profit is unclear, but the Pump.fun <a href="https://solscan.io/account/CebN5WGQ4jvEPvsVU4EoHEpgzq1VV7AbicfhtW4xC9iM">wallet</a> that collects trading fees has so far seen $18.2 million outflows. The purpose of those outflows isn’t known and they shouldn’t be considered irregular, although most occurred around the trading pause in response to a string of <a href="https://blockworks.co/news/pump-fun-flash-loan-attack">flash loan attacks</a> two weeks ago, which resulted in $2 million in losses for the firm.



Ethereum raised only $18 million for its initial coin offering in 2014. Safe to say, Pump.fun has played its hand perfectly so far.



— David Canellis



<h2 class="wp-block-heading">Data Center</h2>



<ul class="wp-block-list">
<li>EigenLayer’s total ETH <a href="https://defillama.com/protocol/eigenlayer?denomination=ETH">locked</a> has stalled over the past month, now sitting below 4.9 million ETH ($18.4 billion), down from over 5 million ETH.</li>



<li>Chainlink has held onto market <a href="https://defillama.com/oracles">share</a> over the past six months amid increasing competition, still securing about 45% of all value tied to oracles. In 2021, that figure was as high as 66%.</li>



<li>After falling with the broader market Wednesday, crypto stocks are looking to claw back slight gains ahead of the opening bell — COIN, MSTR and RIOT are all in the green.</li>



<li>Memecoins Bonk, FLOKI and dogwifhat are all <a href="https://www.coingecko.com/en/crypto-gainers-losers?top=100">down</a> over 10% Thursday morning, per CoinGecko.</li>



<li>Bitcoin ETFs only saw $28 million of inflows, with Grayscale notching $30 million of outflows, according to <a href="https://farside.co.uk/?p=997">data</a> from Farside. </li>
</ul>



<h2 class="wp-block-heading">Can’t stop, won’t stop</h2>



Have the floodgates opened?&nbsp;



After nearly two years of silence, former FTX executive Ryan Salame seems to have just remembered his X account password. Or, maybe, he’s no longer worried about the consequences.&nbsp;



Either way, Salame’s got a classic case of the Twitter fingers and has been quite active on social media.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">hot damn, this is going to get interesting quickly&mdash; Ryan Salame (@rsalame7926) <a href="https://twitter.com/rsalame7926/status/1795529743179354461?ref_src=twsrc%5Etfw">May 28, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



His first post, while cryptic, seemed to imply that Salame’s ready to talk.&nbsp;



And maybe he is since he only has a few months before he heads off to prison to <a href="https://www.justice.gov/usao-sdny/pr/former-ftx-executive-ryan-salame-sentenced-90-months-prison">serve</a> a seven-and-a-half-year sentence.&nbsp;



Earlier this week, Salame was the first of the FTX insiders (aside from Sam Bankman-Fried) to face sentencing, and Judge Lewis Kaplan — who also oversaw the <a href="https://blockworks.co/tag/sbf-trial">trial</a> and sentencing of SBF — didn’t go easy. Kaplan’s sentencing exceeded the prosecutor’s recommended five to seven years.&nbsp;



Of all of the insiders to cut deals with prosecutors, Salame has been very quiet. His former colleagues Caroline Ellison, Gary Wang and Nishad Singh were all present at Bankman-Fried’s trial. While Salame wasn’t, prosecutors <a href="https://blockworks.co/news/former-ftx-exec-ryan-salame-sentenced">said</a> he handed over some information ahead of the trial.



Bits and pieces of Salame’s side have trickled in through memos to the court from his team, prosecutors and through witness letters like the one I <a href="https://blockworks.co/news/empire-newsletter-crypto-in-congress">mentioned</a> in a previous Morning Riff from his good friend, and former colleague, Sam Trabucco.&nbsp;



Salame, in what seems to be an attempt to open his narrative, posted about a media interview and followed it up by saying he had no idea about the $55 million loan he received from Alameda.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">The 55m loan everyone keeps citing, I had no idea about it until after ftx collapsed. Not a dollar ever touched my account and the receiver had no clue I didn&#39;t know about it. Fun thing to learn while my whole world was imploding.&mdash; Ryan Salame (@rsalame7926) <a href="https://twitter.com/rsalame7926/status/1795619019279786121?ref_src=twsrc%5Etfw">May 29, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



While we’ve heard bits and pieces from Singh about the political donations, Salame could offer some more insight into them theoretically. In legal filings ahead of the sentencing, his team also said that he was the “first person” to tell Bahamian authorities about FX’s fraud.



Overnight, Salame seemed to point to possibly authoring a book — though not on the subject of FTX — when he asked X, “Can someone make a book of the best memes for the next few years and sell it on Amazon. Asking for a…”



He might not be the only crypto executive to take up writing either during or before a prison stint, as former Binance CEO Changpeng Zhao also <a href="https://x.com/cz_binance/status/1789503928909894130?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1789503928909894130%7Ctwgr%5Eb8148193185a5afda8e18c631f8f089f031a3e63%7Ctwcon%5Es1_&amp;ref_url=https%3A%2F%2Fdailycoin.com%2Fformer-ceo-turned-author-binances-cz-teases-whats-next%2F">teased</a> a potential book earlier this month.



— Katherine Ross



<h2 class="wp-block-heading">The Works</h2>



<ul class="wp-block-list">
<li>BlackRock <a href="https://www.sec.gov/Archives/edgar/data/2000638/000143774924018610/iset20240522_s1a.htm">filed</a> its revised ETH ETF registration statement, with potential final SEC approval still needed before the funds can launch. </li>



<li>NFTs are susceptible to scams and fraud, the US Treasury Department <a href="https://home.treasury.gov/news/press-releases/jy2382">said</a> in a new report.</li>



<li>President Joe Biden’s re-election campaign is reaching out to people in the crypto industry, The Block <a href="https://www.theblock.co/post/297504/biden-campaign-shifts-crypto-stance-engages-crypto-industry-presidential-elections-2024">reported</a>.</li>



<li>Nope, Vanguard’s still not interested in crypto ETFs, the company <a href="https://blockworks.co/news/vanguard-opposes-platforming-eth-etfs">confirmed</a> to our own Ben Strack.</li>



<li>A “layer-2-centric ecosystem is inherently much more pluralistic,” Vitalik Buterin <a href="https://vitalik.eth.limo/general/2024/05/29/l2culture.html">wrote</a> Wednesday.</li>
</ul>



<h2 class="wp-block-heading">The Morning Riff</h2>



Vitalik mused that layer-2s are an extension of Ethereum’s culture.&nbsp;



Ethereum mainnet — with the unicorns, Miladys and other lovable cringes — is just one subset of it. Layer-2s like Blast and Base are developing their own <a href="https://blockworks.co/news/base-coinbase-l2-success">subcultures</a> within the Ethereum space.&nbsp;



All that puts Ethereum on the path to pluralism, culturally speaking, according to Vitalik.



For all its silliness, Ethereum is deeply rooted in <a href="https://vitalik.eth.limo/general/2023/12/28/cypherpunk.html">cypherpunk</a> ideals, as is Bitcoin. But the further you go out from the public good that is the layer-1, the more likely it is that the infrastructure is controlled by for-profit companies and other entities with vested interests.



Their intentions and missions may align with the spirit of a robust decentralized ecosystem charted by Ethereum, but I can’t help but worry that whatever culture it imbues gets watered down with every bridge hop.&nbsp;



— David Canellis



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Empire Newsletter

Empire Newsletter: Pump.fun is a big winner of the celeb memecoin craze

A federal judge sentenced former FTX executive Ryan Salame to 7.5 years in prison in Manhattan Tuesday, according to a report from Bloomberg.&nbsp;



The <a href="https://news.bloomberglaw.com/crypto/first-of-bankman-frieds-ftx-lieutenants-faces-sentencing">ruling</a> falls just above the government&#8217;s request of five to seven years in prison. Salame’s team earlier this month asked Judge Lewis Kaplan, who presided over FTX founder Sam Bankman-Fried’s criminal trial last fall, for 18 months in prison.&nbsp;



Salame in September pleaded guilty to two counts of campaign finance violations and operating an unlicensed money-transmitting business. By acting as a “straw donor,” the government says, Salame helped “pump more than $100 million dollars in illegal contributions through the US political system to help support <a href="https://blockworks.co/tag/sam-bankman-fried">Bankman-Fried</a> and FTX’s legislative priorities.”&nbsp;



<a href="https://blockworks.co/tag/ryan-salame">Salame</a> is the first among Bankman-Fried’s former associates to be sentenced. He is the only one of the four former <a href="https://blockworks.co/tag/ftx">FTX</a> executives who pleaded guilty that did not testify against Bankman-Fried during his trial.&nbsp;



Salame’s minimal cooperation, the prosecution said in their <a href="https://blockworks.co/news/former-ftx-exec-ryan-salame-sentencing">sentencing memo earlier this month</a>, meant his contributions to the case against Bankman-Fried were “relatively minor.”&nbsp;



Salame did hand over some last-minute information to government attorneys in the days before <a href="https://blockworks.co/tag/sam-bankman-fried">Bankman-Fried</a>’s trial, the government’s memo added, which was helpful during the cross-examination of some witnesses. But, “none of the information resulted in any significant investigative leads, arrests, or charges,” the government told the court.



When asking for leniency, Salame’s team told the court he “has started a new chapter in his life,” adding that he became a first-time father in November and is working toward becoming a lawyer.&nbsp;



Read more: <a href="https://blockworks.co/news/empire-newsletter-ftx-bankruptcy-finish-line">Empire Newsletter: FTX bankruptcy almost across the finish line</a>



Salame was “duped” by Bankman-Fried, his attorneys said, and was “the first person to blow the whistle to authorities in the Bahamas” when he uncovered the nature of the fraud.&nbsp;



The prosecution on Monday evening asked the court to partially vacate and amend the previous forfeiture and money judgment agreements. Salame’s 2021 Porsche 911 Turbo S no longer has “sufficient equity to further pursue forfeiture,” the government noted, and should therefore be returned.&nbsp;



The prosecution also approved Salame’s request for an extension to pay the $6 million he owes the government and asked the court to push the due date for the payment to Sept. 3, 2024.&nbsp;



Former executives <a href="https://blockworks.co/news/caroline-ellison-testimony-hidden-gems">Caroline Ellison</a>, Nishad Singh and Gary Wang, <a href="https://blockworks.co/news/sbf-trial-nishad-singh-testimony">who all testified</a> against Bankman-Fried last fall and entered into formal cooperation agreements with the government, have not yet been sentenced. Singh’s sentencing hearing has been scheduled for November while Ellison and Wang’s dates are not yet on the calendar.



In March, Bankman-Fried was sentenced to <a href="https://blockworks.co/news/sam-bankman-fried-sentenced">25 years in prison</a> for seven counts of fraud and conspiracy.



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Former FTX exec Ryan Salame sentenced to 7.5 years, above government ask 

Prosecutors have asked the court to sentence former FTX executive Ryan Salame to five to seven years in prison.&nbsp;



In the government’s 30-page sentencing memorandum filed Tuesday evening, prosecutors said Salame’s “serious crimes” require “a substantial sentence.”&nbsp;



Salame in September pleaded guilty to two counts for campaign finance violations and operating an unlicensed money transmitting business. By acting as a “straw donor,” the government says, Salame helped “pump more than $100 million dollars in illegal contributions through the US political system to help support Bankman-Fried and FTX’s legislative priorities.”&nbsp;



Read more: <a href="https://blockworks.co/news/ftx-ryan-salame-pleads-guilty">Former FTX exec Ryan Salame pleads guilty weeks before Bankman-Fried’s trial</a>



“The campaign finance offense is one of the largest-ever in American history, and the unlicensed money transmitting business exchanged more than $1 billion without proper supervision,” prosecutors added.&nbsp;



Salame’s cooperation with the government in FTX founder <a href="https://blockworks.co/news/sam-bankman-fried-found-guilty">Sam Bankman-Fried’s criminal trial</a> was “relatively minor,” prosecutors noted, and he never entered into a formal cooperation agreement.&nbsp;



“The defendant did not himself meet with the Government,” prosecutors wrote in the memo. “Rather, Salame provided documents, such as text messages and emails, in response to Government document requests, and authorized his attorneys to make multiple factual proffers to the Government.”&nbsp;



Read more: <a href="https://blockworks.co/news/the-gop-also-got-millions-from-ftx-execs">Not just Democrats: FTX exec gave tens of millions to GOP causes</a>



Salame did hand over some last-minute information to government attorneys in the days before <a href="https://blockworks.co/tag/sam-bankman-fried">Bankman-Fried</a>’s trial, the memo added, which were helpful during cross-examination of some witnesses. But, “none of the information resulted in any significant investigative leads, arrests, or charges,” the government told the court.&nbsp;



Salame is scheduled to be sentenced in Manhattan on May 28.&nbsp;



Last week, the defense asked the court to sentence Salame to 18 months in prison, claiming the former executive had been “duped” by Bankman-Fried and was “the first person to blow the whistle to authorities in the Bahamas” when he uncovered the nature of the fraud.&nbsp;



Salame has been working to pursue a law degree, his attorneys added, stating that he has already taken the Law School Admission Test (LSAT) in the hopes he can eventually “help less fortunate individuals.”&nbsp;



Former executives <a href="https://blockworks.co/news/caroline-ellison-testimony-hidden-gems">Caroline Ellison</a>, Nishad Singh and Gary Wang, <a href="https://blockworks.co/news/sbf-trial-nishad-singh-testimony">who all testified</a> against Bankman-Fried last fall and entered into formal cooperation agreements with the government, have not yet been sentenced. Singh’s sentencing hearing has been scheduled for November while Ellison and Wang’s dates are not yet on the calendar. 



Bankman-Fried in March was sentenced to <a href="https://blockworks.co/news/sam-bankman-fried-sentenced">25 years in prison</a> for seven counts of fraud and conspiracy.



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Government asks for 5-7 years for former FTX exec Ryan Salame 

Former FTX exec Ryan Salame has pleaded guilty to charges related to his role at the failed crypto exchange.&nbsp;



<a href="https://blockworks.co/tag/ryan-salame">Salame</a> appeared in court Thursday to plead guilty to charges of conspiracy to defraud the Federal Elections Committee and operating an unlicensed money transmitting business. The combined charges carry a maximum of ten years in prison.&nbsp;



“Ryan Salame agreed to advance the interests of FTX, Alameda Research, and his co-conspirators through an unlawful political influence campaign and through an unlicensed money transmitting business, which helped FTX grow faster and larger by operating outside of the law,” US Attorney <a href="https://blockworks.co/tag/damian-williams">Damian Williams</a> said in a statement. “Today’s guilty plea reflects the commitment I made in December that my Office would continue to pursue swift justice against individuals at FTX and its affiliates who engaged in criminal conduct.”&nbsp;



Salame entered his guilty plea in Manhattan Thursday afternoon, weeks before former CEO Sam Bankman-Fried is set to stand trial on Oct. 2.&nbsp;



As part of his plea, Salame admitted to making $10 million in political contributions and falsely labeling them “loans.” He noted that <a href="https://blockworks.co/tag/sam-bankman-fried">Bankman-Fried</a> endorsed this action.&nbsp;&nbsp;



Salame’s plea marks the fourth former <a href="https://blockworks.co/tag/ftx">FTX</a> executive to opt for a guilty plea over a jury trial. Caroline Ellison, former FTX CEO, pleaded guilty to seven offenses, including charges of money laundering and wire fraud.&nbsp;



Bankman-Fried’s co-founder Gary Wang was the first to enter a guilty plea. In December, Wang pleaded guilty to four counts, including wire fraud and conspiracy to commit money laundering.&nbsp;



Nishad Singh, another co-founder, pleaded guilty to five charges, including securities and wire fraud, in February. He is scheduled to be sentenced on Nov.13.&nbsp;



Ellison, Wang and Salame do not yet have sentencing hearings scheduled.



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Damian Williams

Former FTX exec Ryan Salame pleads guilty weeks before Bankman-Fried’s trial

It’s no secret Sam Bankman-Fried shelled out millions to Democratic causes.&nbsp;



But it turns out a fellow top executive — Ryan Salame, the former co-head of FTX’s derivatives business and FTX <a href="https://blockworks.co/news/ftx-execs-user-funds-alameda" target="_blank" rel="noreferrer noopener">whistleblower</a> — was backing Republicans and conservative PACs in a big way.&nbsp;



Meanwhile, some of the donations from SBF himself may not have been properly <a href="https://www.citizensforethics.org/wp-content/uploads/2022/12/SBF-FEC-Complaint-FINAL.pdf" target="_blank" rel="noreferrer noopener">disclosed</a>, according to Bankman-Fried’s own telling.



There is no knowing how much he gave under the table. The now-disgraced FTX founder has admitted he kept significant sums to Republicans under wraps.&nbsp;



“I donated about the same amount to both parties,” Bankman-Fried <a href="https://www.youtube.com/watch?t=782&amp;v=6DezodR9hNI&amp;feature=youtu.be" target="_blank" rel="noreferrer noopener">told</a> <a href="https://twitter.com/TiffanyFong_" target="_blank" rel="noreferrer noopener">Tiffany Fong</a>, a YouTube influencer, before his <a href="https://blockworks.co/news/sam-bankman-fried-arrested-in-bahamas" target="_blank" rel="noreferrer noopener">arrest</a> in the Bahamas. “All my Republican donations were dark.”



His rationale, Bankman-Fried told Fong, had nothing to do with regulatory scrutiny. It was, instead, all about protecting his now-tarnished — but once pristine — public image.&nbsp;



“Reporters freak the f— out if you donate to Republicans,” he said during the interview. “They’re all super liberal, and I didn’t want to have that fight.”



<h3 class="wp-block-heading">But Republicans cashed in, too</h3>



At least one executive did not share his concern. Salame, who then held the title of co-chief executive of FTX Digital Markets, made notable personal contributions to GOP campaigns and causes.&nbsp;



Salame alone gave nearly $23 million almost exclusively to Republicans and right-leaning PACs, according to <a href="https://www.fec.gov/data/receipts/individual-contributions/?contributor_name=Ryan+Salame" target="_blank" rel="noreferrer noopener">FEC data</a>.



Salame did not immediately respond to a request for comment.



Bankman-Fried, arrested in the Bahamas, <a href="https://www.justice.gov/opa/pr/ftx-founder-indicted-fraud-money-laundering-and-campaign-finance-offenses" target="_blank" rel="noreferrer noopener">faces federal charges</a>, including money laundering, wire fraud and campaign finance violations.



According to Federal Election Commission (FEC) data, Bankman-Fried personally gave $40 million to various Political Action Committees (PACs) and individual candidates, almost entirely to Democrats.



But FTX US, the American subsidiary of the crypto exchange, donated $500,947.30 between December 2021 and September 2022, according to FEC <a href="https://www.fec.gov/data/receipts/individual-contributions/?contributor_name=FTX" target="_blank" rel="noreferrer noopener">records</a> — the majority to the crypto-focused <a href="https://blockworks.co/news/poll-us-voters-who-own-crypto-are-on-the-rise-just-in-time-for-midterms" target="_blank" rel="noreferrer noopener">GMI PAC</a>, which primarily backed the Republican-aligned Crypto Innovation PAC during the 2022 midterms. Bankman-Fried served as the entity’s chief executive at the time of the donations.&nbsp;



Crypto Innovation PAC, in turn, financed the campaigns of Republicans Michelle Bond — who lost the New York Republican primary for the House of Representatives in 2022 — and Rep. Markwayne Mullin of Oklahoma, who beat out his competition. The group also donated to Rep. Patrick McHenry, R-N.C., Sen. Ted Budd, R-N.C., and Sen. John Boozman, R-Ark., all of whom won their respective races.&nbsp;



All had been <a href="https://blockworks.co/news/bipartisan-stablecoin-regulation-has-a-slim-chance-of-passing-this-year" target="_blank" rel="noreferrer noopener">vocal</a> crypto advocates. At least back then.&nbsp;



Bond also received at least $400,000 in consulting fees from FTX Digital Markets, according to the candidate’s <a href="https://disclosures-clerk.house.gov/public_disc/financial-pdfs/2022/10049865.pdf" target="_blank" rel="noreferrer noopener">financial disclosure report</a> filed in August. No direct donations from FTX to Bond were reported in <a href="https://www.fec.gov/data/receipts/?committee_id=C00816561&amp;two_year_transaction_period=2022&amp;line_number=F3-11AI&amp;data_type=processed" target="_blank" rel="noreferrer noopener">FEC filings</a>.&nbsp;



Salame was <a href="https://www.nytimes.com/2022/12/17/business/ftx-ryan-salame.html" target="_blank" rel="noreferrer noopener">romantically involved</a> with Bond. Salame was also a top donor to the <a href="https://www.fec.gov/data/committee/C00694323/" target="_blank" rel="noreferrer noopener">WINRED PAC</a>, which raked in over $1 billion and gave more than $300,000 to Bond, according to <a href="https://www.fec.gov/data/receipts/?committee_id=C00816561&amp;two_year_transaction_period=2022&amp;line_number=F3-11AI&amp;data_type=processed" target="_blank" rel="noreferrer noopener">filings</a>.&nbsp;



Bankman-Fried’s personal disclosed donations went a long way toward advancing the recipients’ respective agendas, particularly the Protect our Futures PAC, a liberal initiative that credits $27 million of its total $28.5 million raised to Bankman-Fried himself.&nbsp;



Reps. Lucy McBath, D-Ga., and Jasmine Crockett, D-Texas, were two PAC-supported candidates that went on to win their seats in 2022.



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Not Just Democrats: FTX Exec Gave Tens of Millions to GOP Causes

Shalini Nagarajan

A senior FTX executive blew the whistle on user funds being siphoned to Sam Bankman-Fried&#8217;s trading shop Alameda Research, just days before the firms filed for bankruptcy.



Ryan Salame, co-CEO of FTX Digital Markets, informed regulators on Nov. 9 about illicit transfers to Alameda, <a href="https://restructuring.ra.kroll.com/FTX/Home-DownloadPDF?id1=MTM1NTM4NQ==&amp;id2=-1" target="_blank" rel="noreferrer noopener">court documents</a> filed Wednesday showed, the same day that Binance pulled out of its proposed rescue deal.



The transfers were made to cover Alameda’s “financial losses,&#8221; Salame said. He added the movements were perverse to FTX’s ordinary course of action and may constitute misappropriation, theft, fraud or some other crime.



Only three people had the required passwords to transfer user funds to Alameda, Salame said: Former CEO Bankman-Fried, director of engineering Nishad Singh and chief technology officer Gary Wang, the latter serving the same role at Alameda.



FTX Digital Markets <a href="https://blockworks.co/news/ftx-bahamas-unit-filed-bankruptcy" target="_blank" rel="noreferrer noopener">filed for bankruptcy</a> in the Bahamas about one week after more than 100 affiliated companies <a href="https://blockworks.co/news/ftx-bankrupt-hacked-investigated-a-timeline-of-events" target="_blank" rel="noreferrer noopener">did the same</a> in the US. Singh and Wang&#8217;s roles were quickly <a href="https://www.wsj.com/articles/bankrupt-ftx-fires-three-of-sam-bankman-frieds-top-deputies-11668825607" target="_blank" rel="noreferrer noopener">terminated</a>. 



Both former executives were on the Bahamas luxury island of New Providence as of Nov. 9 and mostly resided in 600-acre luxury resort Albany, according to the court document.&nbsp;



Bankman-Fried and Alameda CEO Caroline Ellison also resided in Albany, <a href="https://www.straitstimes.com/business/caroline-ellison-was-a-little-known-crypto-trader-until-ftx-collapsed" target="_blank" rel="noreferrer noopener">reportedly</a> living together in a five-bedroom penthouse suite with eight others.



Salame himself joined FTX Digital Markets, the firm operating FTX&#8217;s flagship Bahamas-based trading platform, in September 2021. He <a href="https://www.theblock.co/post/186400/ftx-digital-markets-co-ceo-staying-on-lawyering-up-sources" target="_blank" rel="noreferrer noopener">reportedly</a> ran Alameda&#8217;s over-the-counter desk for two years before taking on the co-CEO role at FTX, and is said to have plans to stay and help pick up the pieces.



Salame’s information prompted Christina Rolle, executive director of the Bahamas securities commission, to request local police investigate. He didn’t return Blockworks’ request for comment by press time.



Bankman-Fried is so far the only FTX insider arrested, with US authorities charging the former crypto billionaire a <a href="https://blockworks.co/news/no-bail-for-bankman-fried-leaves-bahamas-court-in-handcuffs" target="_blank" rel="noreferrer noopener">fraud-heavy eight count</a> indictment on Tuesday, alongside <a href="https://blockworks.co/news/sec-charges-sam-bankman-fried-with-defrauding-investors" target="_blank" rel="noreferrer noopener">separate</a> SEC charges.



Ellison has hired her own legal defense, which includes a <a href="https://blockworks.co/news/alamedas-ellison-hires-ex-sec-lawyer-who-charged-musk-holmes" target="_blank" rel="noreferrer noopener">former top SEC lawyer</a> who brought cases against Ripple Labs, Elon Musk and Theranos fraudster Elizabeth Holmes.



<h3 class="wp-block-heading">FTX may have siphoned $10 billion in user funds to Alameda</h3>



Recent court filings separately showed Bahamas regulators exchanging emails with Bankman-Fried prior to FTX’s bankruptcy. He was asked to meet with the local securities commission to discuss the platform’s solvency and Binance’s potential rescue deal.



In one email addressed to Bahamian lawyer Ryan Pinder, Bankman-Fried apologized for delays in his responses, claiming he was focused only on “making customers whole.”&nbsp;



“We are investigating a more thorough answer to this question; we did not intend to, but are concerned that poor risk management will lead to a liquidity issue,” Bankman-Fried said.



FTX reportedly <a href="https://blockworks.co/news/ftx-lost-up-to-2b-in-user-funds-10b-sent-to-alameda-report" target="_blank" rel="noreferrer noopener">moved some $10 billion</a> in client funds to Alameda over the years, and between $1 billion and $2 billion of those funds are unaccounted for.&nbsp;



Reuters <a href="https://www.reuters.com/technology/ftxs-bankman-fried-begged-rescue-even-he-revealed-huge-holes-firms-books-2022-11-16/" target="_blank" rel="noreferrer noopener">reported</a> FTX co-founder Wang had built a “backdoor” into the exchange’s book-keeping software, per the outlet’s sources, which let Alameda withdraw FTX user funds without setting off internal systems.&nbsp;



Bankman-Fried, who was <a href="https://blockworks.co/news/sam-bankman-fried-arrested-in-bahamas" target="_blank" rel="noreferrer noopener">arrested in the Bahamas</a> on Monday and faces potential US extradition, has repeatedly denied any wrongdoing and claimed he <a href="https://blockworks.co/news/bankman-fried-underestimated-collapse" target="_blank" rel="noreferrer noopener">never intended to commingle</a> user funds, instead blaming mislabelled bank-related accounts.



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