Ex-FTX Executive Ryan Salame Sentenced to 7.5 Years in Prison
Ex-FTX Executive Ryan Salame Sentenced to 7.5 Years in Prison
The Facts
On Tuesday, Ryan Salame, former executive at cryptocurrency exchange FTX, was sentenced to seven-and-a-half years in prison for campaign finance law violations and for operating an unlicensed money transmitting business.
Salame is the first of FTX founder Sam Bankman-Fried's subordinates to be convicted since the collapse of FTX. Salame will also serve three years of supervised release, forfeit $6M, and pay more than $5M in restitution.
The Spin
The FTX saga has revealed an intrinsic problem with cryptocurrency that was bigger than Sam Bankman-Fried or any of his underlings. What FTX was found guilty of is par for the course in the cryptocurrency world, as an entity build on imaginary tokens it produced itself. This problem does not end with FTX, and it may indeed be the fatal flaw that lies at the heart of all cryptocurrency ventures.
While Sam Bankman-Fried's mistakes have cast a shadow over the crypto world, the fact is that too much regulation, not a lack of it, made this possible. By keeping centralized deposits, FTX was tempted to skim off the money of customers. The blockchain allows decentralized exchanges that use "smart contracts" to have every cent accounted for. What brought down FTX was a flaw in humanity, not cryptocurrency itself.
