Overview
Partner Andrew Adams and associate Kane Smith authored an article titled "The Other FTX Case," which appeared in CoinDesk.
The allegations at the heart of the trial of Sam Bankman-Fried (SBF) paint a picture of a large-scale fraud, but are limited to the misadventures of a particular corporate family at FTX and Alameda Trading. The government’s case does not represent a systemic threat to the core business model of most firms in this space. However, digital asset companies continue to face a regulatory and prosecutorial environment, where the threat of such charges hangs over good-faith actors seeking to participate in global markets through traditional banking rails. By contrast, the charges the government failed to include in the current SBF case are of systemic importance to the industry, reflecting the specter of regulatory and prosecutorial pressure that dissuades traditional financial institutions from engaging with lawful, ethical and viable digital asset projects. The mere potential for such charges places crypto and other blockchain projects between a commercial rock and a regulatory hard place.