Prosecutors Demand Harsh Sentence for Former FTX Executive Ryan Salame

United States prosecutors have called for a prison sentence of five to seven years for Ryan Salame, the former FTX executive linked to the collapse of the crypto exchange. Salame, considered a key associate of FTX co-founder Sam “SBF” Bankman-Fried, faces charges that he misappropriated investor funds.

On May 21, federal prosecutors submitted a sentencing memo in a Manhattan federal court, emphasizing the severity of Salame’s crimes. They argued for a “just punishment” that reflects the magnitude of his offenses. Salame’s legal team, however, is advocating for a maximum sentence of 18 months. Prosecutors underscored the scale of the crime, stating, “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.”

Salame’s sentencing is scheduled for May 28. Prosecutors believe that only a significant prison term will serve as a deterrent and uphold respect for the law. They insist that such a sentence is necessary to address Salame’s role in helping SBF divert $10 billion of users’ funds.

The FTX Saga

Ryan Salame’s involvement with FTX began in 2019 when he joined Alameda Research in Hong Kong. He quickly ascended to become the CEO of FTX Digital Markets, the Bahamas-based subsidiary of FTX. His sentencing will make him the first of SBF’s associates to face jail time. On April 1, the U.S. District Court for the Southern District of New York sentenced SBF to 25 years in prison on seven felony charges.

Other key figures in the FTX scandal, such as Caroline Ellison, Nishad Singh, and Gary Wang, are still awaiting their sentences. This ongoing legal drama highlights the extensive consequences of the FTX collapse.

In the wake of the FTX scandal, U.S. lawmakers are pushing for clearer regulatory guidelines for digital assets. North Carolina Representative Wiley Nickel has urged support for the Financial Innovation and Technology for the 21st Century (FIT21) Act. This bill aims to define the roles of the Securities and Exchange Commission and the Commodity Futures Trading Commission in regulating cryptocurrencies, to “prevent the next FTX” from happening.