Home > Highlights > Body

This Week on Crypto Twitter: Courtroom Dramas for Coinbase, Sam Bankman-Fried

2024-03-31 18:01:02
This Week on Crypto Twitter
Illustration by Mitchell Preffer for Decrypt

Legal intrigue was the theme of the week, keeping Crypto Twitter perched on the edge of its seat—booing and cheering in equal measure. 

On Monday, a federal judge declined to dismiss the Securities and Exchange Commission's (SEC) ongoing lawsuit against Coinbase, finding most of the regulator’s key arguments “plausible” and generally concurring that the SEC has jurisdiction over much of the crypto industry.

Coinbase’s leadership quickly dismissed the ruling as expected and clarified that it in no way meant the crypto exchange had lost—only that the case was now proceeding towards trial.

Today, the Court decided that our SEC case will move forward on most of the claims, but dismissed the claims against Coinbase Wallet. We were prepared for this, and we look forward to uncovering more about the SEC’s internal views and discussions on crypto regulation. 1/6

— paulgrewal.eth (@iampaulgrewal) March 27, 2024

But legal experts were clearly surprised that the case’s judge—who at one point appeared persuaded by Coinbase’s arguments—found so much of the logic underpinning the SEC’s arguments to be sound. 

I did not expect full dismissal, no. But CB's best legal arguments are not getting any traction. And it's bewildering.

— Scott Johnsson (@SGJohnsson) March 27, 2024

The buzz around the ruling got big enough that even Edward Snowden weighed in—dismissing it as meaningless and predicting that other rulings, political developments, and legal structures in the United States will eventually force the SEC to drop its enforcement campaign against huge swathes of the crypto industry. 

This doesn't bother me. If the SEC keeps acting in bad faith like this, they're going to lose so hard in court that they'll never be able to do this to anyone ever again. Remember when the SEC got spanked so badly that Gensler had to approve BTC ETFs with tears in his eyes? yeah https://t.co/XWOwmoaICN

— Edward Snowden (@Snowden) March 27, 2024

Of course, the biggest legal news of the week came on Thursday, when disgraced FTX founder Sam Bankman-Fried was sentenced to 25 years in federal prison for his involvement in criminal fraud at his crypto exchange. 

Details from the sentencing hearing were principally filtered from the Manhattan courtroom where it took place into the world via a single Twitter account—InnerCityPress—which often live tweets the transcripts of trials in New York City. 

The transcript of Bankman-Fried’s sentencing was replete with gems that instantly went viral—from the former billionaire’s defense attorney praising him as “a beautiful puzzle” to the case’s judge, Lewis Kaplan, excoriating the crypto founder’s testimony as the worst he’s seen from a defendant in almost 30 years on the bench. 

Mukasey: He's an awkward math nerd. He's into veganism. He has an off the chart intellect. He is a beautiful puzzle. He can parse words better than a Talmudic scholar. He was a billionaire unconcerned about material possessions

— Inner City Press (@innercitypress) March 28, 2024

Judge Kaplan: When not lying, he was evasive, hair splitting, trying to get the prosecutors to rephrase questions for him. I've been doing this job for close for 30 years. I've never seen a performance like that.

— Inner City Press (@innercitypress) March 28, 2024

Many crypto users ravenously consuming live tweets of the sentencing hearing were clearly more accustomed to tracking ever-fluctuating crypto prices, than tuning into hours-long legal proceedings. Almost two hours into the hearing—which saw Bankman-Fried, his attorney, an FTX victim, and Judge Kaplan all give lengthy speeches—some Twitter users hit their limit, desperate for the headline announcement of the length of the defendant’s sentence. 

brother in christ just say the words

— CR1337 (@cryptonator1337) March 28, 2024


— overHere (@overHere_gg) March 28, 2024

Soon enough, the news came. And when it did, Crypto Twitter was split—between those who had hoped Bankman-Fried would have received a more draconian sentence and others who found 25 years in a likely rough federal prison to be an adequate punishment for a first-time non-violent offender. 

SBF got off really easy given the gravity of the crimes he committed and how many victims there are.

— Hashoshi | Crypto Over Coffee ☕️ (@hashoshi4) March 28, 2024

i get that some of you wanted to see SBF serve a longer sentence, but 25 years in prison is not "getting off easy" or a "slap on the wrist"

— Molly White (@molly0xFFF) March 28, 2024

Unmistakably, though, Bankman-Fried’s sentencing was a historic—and cathartic—milestone for the crypto industry, one that was quickly immortalized in a typically dark and provocative creation by the digital artist Beeple. 

25 YEARS LATER... pic.twitter.com/hk1viMiZnj

— beeple (@beeple) March 29, 2024

Edited by Ryan Ozawa.