The story of the FTX collapse has received one final chapter. Caroline Ellison and Gary Wang, whose testimonies proved decisive in the case against Sam Bankman-Fried, have finally settled all claims with U.S. regulators. The outcome was symbolic: no new fines, but strict restrictions on professional activity in the industry.
Terms of the deal: bans instead of money
The U.S. Commodity Futures Trading Commission (CFTC) confirmed that a federal court in New York approved additional consent orders. The proceedings had dragged on since November 2022, when FTX collapsed, leaving billions in debts to customers.
The numbers here speak louder than words. Ellison, who headed trading firm Alameda Research, received a five-year ban on trading and a ten-year ban on registration. Wang, co-founder and lead developer of FTX, was given a similar five-year trading ban and an eight-year ban on registration. All restrictions apply retroactively—from December 2022, when the court first accepted their guilty pleas. This means Ellison will be able to return to trading as early as late 2027, and Wang by late 2030.
Notably, the CFTC dropped its demands for restitution, disgorgement, and civil penalties. The reasons are obvious: both individuals actively cooperated with investigators and are already obligated to pay $11.02 billion in criminal cases. As the CFTC's Director of Enforcement emphasized, the nature of the sanctions reflects the "substantial assistance" they provided to the commission in investigations related to FTX.
A contrast of fates: SBF watches from prison
Significantly, the SEC took a similar approach in December, imposing long-term officer-and-director bans without new fines. Ellison received the same 10 years there, Wang eight. Cooperation became their deal with justice: Ellison was released from prison in January, having served just 14 months of a two-year sentence. Wang avoided incarceration altogether—in November 2024, Judge Lewis Kaplan sentenced him to time already served in pretrial detention, noting an unprecedented level of cooperation.
Sam Bankman-Fried chose to fight and lost. He is serving 25 years, an appeals court upheld the verdict in June, and the mandate issued on August 4 made it final. He has only two options left: an appeal to the Supreme Court or a presidential pardon, which senators from both parties have already spoken out against.
The liquidation of FTX assets is nearing completion, and only one dispute over claims remains in the bankruptcy case. The insiders who turned in their boss are building new lives.
My view: This outcome is a clear signal to the market: regulators are willing to forgive financial sins in exchange for information, but reputational consequences remain forever. For the crypto industry, this is a lesson that the price of loyalty to toxic leadership can be higher than the price of cooperating with investigators. The question is whether the market can fully trust those who once betrayed customer trust.