The quarter century in prison that U.S. District Judge Lewis Kaplan prescribed was less than what prosecutors wanted for what they called his “massive” financial crimes, but far more than defense lawyers sought. Bankman-Fried was also ordered to pay more than $11 billion.

Bankman-Fried, co-founder of crypto exchange FTX and investment fund Alameda Research, failed to take responsibility for the disaster he created, Kaplan said in handing down the sentence. “Mr. Bankman-Fried says mistakes were made … but never a word of remorse for the commission of terrible crimes,” Kaplan said.

Thursday’s hearing underscored the precipitous downfall of the man who turned FTX into a behemoth, with a Super Bowl ad, naming rights to a Miami stadium and glowing publicity for its cryptocurrency exchange. Jurors in November convicted Bankman-Fried on charges related to wire fraud, conspiracy to commit fraud and conspiracy to commit money laundering.

Only when FTX collapsed into bankruptcy in 2022 did investigators uncover what prosecutors have described as a straightforward fraud dressed up as a breakthrough financial innovation. Bankman-Fried was accused of misappropriating FTX customer funds to spend lavishly on luxury real estate, investments and political donations.

Prosecutors asked for a sentence of at least 40 years in prison. Defense attorneys argued that a sentence of five to six years would be more appropriate.

Bankman-Fried and his top deputies, prosecutors said, took customers’ money out of FTX and put it into Alameda Research. At the trial, former Alameda chief executive Caroline Ellison, who pleaded guilty to conspiracy charges before cooperating with prosecutors, described Bankman-Fried telling her to use FTX funds.

“The criminality here, it’s massive in scale,” prosecutor Nicolas Roos said Thursday. “It was pervasive in all aspects.”

The chance that Bankman-Fried could commit other crimes weighed into the sentencing decision, Kaplan said.

“There is a risk this man will be in a position to do something very bad in the future and it’s not a trivial risk,” the judge said. “Not a trivial risk at all.”

Under federal rules, Bankman-Fried probably will serve more than 21 years in prison before he can be eligible for release. Kaplan said he should serve his sentence in a low- or medium-security institution near his parents’ home in the San Francisco Bay Area. Although he castigated Bankman-Fried, the judge said the prosecution’s sentencing request was “substantially greater than is necessary.”

The 25-year sentence is longer than most sentences for high-profile white-collar crimes, although Bernie Madoff received a 150-year sentence in 2009 for running a Ponzi scheme that cost victims an estimated $20 billion or more; he died in prison 12 years later. Elizabeth Holmes, who took in hundreds of millions from investors for blood-testing start-up Theranos, was sentenced in 2022 to more than 11 years in prison.

Defense lawyer Marc Mukasey argued that his client should not be compared to Madoff because Bankman-Fried did not have harmful intentions. “It’s obviously a serious offense, but Sam was not a ruthless financial serial killer who set out every morning to hurt people,” Mukasey said Thursday. He described Bankman-Fried as a person who “doesn’t make decisions with malice in his heart. He makes decisions with math in his head.”

In arguing for leniency, Mukasey extolled Bankman-Fried’s intelligence and his lifelong interest in helping others, and described his client as “a beautiful puzzle.”

Bankman-Fried said that as the leader of FTX, he ultimately bears the blame for the misfortunes that befell the company’s customers. “It must just be an excruciating feeling, waiting every day, not knowing what’s going to happen, feeling that they’ve lost everything,” he said, clutching his elbows while a courtroom artist sketched him.

But Bankman-Fried, in a khaki-colored prison T-shirt, also gave a meandering account of events in an attempt to justify some of his actions. “I made a series of bad decisions,” said Bankman-Fried, who spoke for about 20 minutes. “They weren’t selfish decisions. … They were bad decisions.”

His lack of a straightforward confession or apology might have pushed Kaplan toward a stiffer sentence, said white-collar defense lawyer Jack Sharman, who characterized Bankman-Fried’s testimony during the trial as a “disastrous” performance.

“Would [taking responsibility] have dramatically reduced it? I don’t know,” said Sharman, who was not involved with the case. “But I’ve been at enough sentencings to feel a palpable difference when defendants do that and when they don’t.”

Federal officials spoke of the financial devastation suffered by FTX customers. Manhattan U.S. Attorney Damian Williams said in a statement that Bankman-Fried created “extraordinary harm” for victims, some of whom “had their life savings wiped out overnight.”

Bankman-Fried on Thursday claimed that FTX still had the money, spread across various accounts and investments, to fully restore customers’ funds. “There’s plenty of assets to do that,” he said. “There’s billions more. It’s been true the whole time.”

John Ray III, who is leading the company through the bankruptcy process as chief executive, had criticized that stance in a letter to the court. The defense’s assertion that FTX customers and investors suffered no harm is “callously and demonstrably false,” Ray wrote before Thursday’s hearing.

Bankman-Fried cast aspersions on that ongoing bankruptcy and said FTX’s problems amounted to a “liquidity crisis” that should have lasted only a few weeks. But Roos took issue with that view. “It wasn’t a liquidity crisis or an act of mismanagement or poor oversight from the top,” the prosecutor said. “It was the theft of billions of dollars.”

Ahead of Thursday’s hearing, some trial observers wondered whether the Justice Department overreached in asking for at least 40 years in prison. A full recovery of FTX assets could undercut prosecutors’ assertion of “dramatic devastating personal loss” for investors, said Martin Auerbach, a white-collar defense lawyer who has been involved in cryptocurrency cases but did not work on Bankman-Fried’s case.

“That is part of the theory for why he should be punished,” Auerbach said before the hearing. “If that will turn out not to be correct because those small investors have been made whole or recovered much of their money, I think the judge has the discretion to say, ‘I’m going to look at the loss in a different way.’”

Kaplan instead took a harder line.

“A thief who takes his loot to Las Vegas and successfully bets the stolen money is not entitled to a discount on his sentence,” he said Thursday.

The judge concluded that Bankman-Fried defrauded investors out of $1.7 billion, his hedge fund’s lenders out of $1.3 billion and FTX customers out of $8 billion. In an adjacent room at the court from which many victims and other observers watched the proceedings, some let out soft whistles as they heard each of the numbers.

If federal officials follow Kaplan’s recommendation, Bankman-Fried would serve his term at a prison near the Bay Area, perhaps not far from where he grew up at his parents’ home at Stanford University. At least one Stanford alumnus on Thursday saw the sentence as just.

FTX’s collapse was “truly devastating” for its customers, said Tyler Benster, a start-up founder who has a PhD in neuroscience from Stanford. Benster hopes the sentences of Bankman-Fried and Holmes, another Stanford-associated tech entrepreneur, might serve as a warning to the tech world.

“I want to see the return of the nerds — of the scientists and hardcore engineers,” Benster said. “I think we’re going to see this resurgence of looking more at the actual technical prowess and accomplishments rather than this vision-spinning and setting that has run away.”

Bankman-Fried’s prison term will set an important example, said Sheila Warren, chief executive of the trade group Crypto Council for Innovation. “This sentencing is crucial,” Warren said. “What we don’t want to do is incentivize people to say, ‘Oh, you just pay a big fine and do whatever you want.’ No, you go to jail if you lie, if you steal.”

She said she faulted not just Bankman-Fried, but also the many people who lionized him instead of questioning whether he was honest. “There were a lot of institutions that were supporting this kind of wunderkind mythology,” she said.

The case has affected the whole cryptocurrency industry. University of Richmond law professor Carl Tobias pointed to FTX’s collapse as motivation for the Biden industry’s push to regulate cryptocurrency companies: “It’s Exhibit A for arguing to regulate this as we regulate other activities, especially in the stock market.”

Lisa Bonos contributed to this report.