Fast Times at FTX High

There was romance. There was betrayal. There was a judge akin to a mean principal—and also a weird old guy who came to all the parties? Ew!

The FTX saga often read like a high school drama. Not to mention the fact that many of the key players were all baby-faced and in their 20s—which doesn’t absolve them from committing one of the largest financial frauds of all time.

In honor of what seems like a bittersweet end (but also, beginning?) to a year-long trainwreck from which we could not look away, here’s a look back at the FTX class of 2023.

Sam Bankman-Fried
Most likely to become president

Once known for dragging a roller backpack in high school without a hint of embarrassment, Sam Bankman-Fried enjoyed a meteoric rise from taciturn outcast to the top of the heap. He used his disarming manner and relentless vision to build an empire around him, dragging his friends and lovers into a crypto enterprise once valued at $32 billion before it disintegrated into the fraud of the century. Bankman-Fried, who once mused to his on-again/off-again girlfriend that he could one day become president, will instead spend decades in prison. His second trial is set to begin in March.

Caroline Ellison
Homecoming queen

Caroline Ellison was once the queen of the nerds. And like any homecoming queen, she occupied the gravitational center—of Sam Bankman-Fried’s trial. As the former CEO of his crypto hedge fund, Ellison, who once went steady with Bankman-Fried, delivered some of the most explosive testimony of the case. After her three days on the witness stand in October, she left the lower Manhattan courthouse and hasn’t reappeared in public since. She struck a deal with the government and has pleaded guilty to seven counts of fraud. The extent of her punishment will likely be determined after Bankman-Fried’s second trial.

Photo-illustration by Fortune; book from Getty Images; portraits: Stephanie Keith—Bloomberg/Getty Images

Gary Wang
Class nerd

If Caroline Ellison was queen nerd, Gary Wang, the former CTO of FTX, was the prototypical wonk. Often silent, he and Bankman-Fried met at a math camp in high school (nerd alert!), and Wang, a skilled programmer, eventually helped Bankman-Fried start his crypto hedge fund and exchange. In the trial of his one-time bestie, Wang did speak (albeit less than the other key witnesses) and blamed his former boss for FTX’s multibillion-dollar hole. Like Ellison, he struck a plea deal with the government and will likely wait until after Bankman-Fried’s second trial to hear if he will receive detention.

Nishad Singh
Most likely to get ID’d when he’s 30

Bright-eyed and baby-faced, Nishad Singh was the kid in class who always talked about the greater good and seemed to actually mean it. Among the FTX crew, Singh was one of the fiercest acolytes of the utilitarian ethos known as effective altruism. He followed a moral compass that maybe could have used a tune-up, donating millions of his personal earnings to charitable causes—which unfortunately turned out to include an illegal straw-donor scheme. He also took the nicest room at the FTX inner circle’s $30 million Bahamas penthouse (whoops). After admitting to his sins on the witness stand in New York, Singh will likely testify again at Bankman-Fried’s second trial in March before awaiting his own sentencing. 

Ryan Salame
Biggest flirt

With his square jaw and red-blooded politics, Ryan Salame stood out from the nerd army at FTX. Rising the ranks as a crypto trader with a predilection for partying, Salame used his growing influence at FTX to funnel millions to conservative causes and land himself an influential girlfriend—Michelle Bond, a D.C. power broker who launched a failed run for Congress powered by potentially illegal FTX donations. Salame also helped devise a plan to trade Alameda funds frozen by the Chinese government using Thai prostitutes. While Salame entered into a plea agreement with prosecutors, he invoked his Fifth Amendment right against self-incrimination and failed to make a guest appearance at this fall’s trial. He is awaiting sentencing.

Photo-illustration by Fortune; book from Getty Images; portraits: Courtesy of Menlo, courtesy of Tiffany Fong

Amy Wu
Most likely to land on her feet

Amy Wu rode into FTX as the cool older kid who could add an air of gravitas to any party—a former partner at the blue-chip VC firm Lightspeed who was tasked with heading up Bankman-Fried’s venture portfolio. She lasted just 10 months before SBF’s empire collapsed, and most of the biggest deals (hello billion-dollar Kazakhstan Bitcoin mining injection) came from Bankman-Fried himself. Pleading ignorance, Wu managed to maintain her credibility in the clubby VC world, landing a plum position at Menlo Ventures. She said she’s pivoting to AI.

Sam Trabucco
Most likely to skip class

Sam Trabucco is the classmate who never did any work on the group project—and then when the teacher suspended everyone for plagiarism, he conveniently decided not to show up to class. Ever again. One of the earliest members of the FTX inner circle, Trabucco co-led Alameda Research with Caroline Ellison. As the riches began to pour in, he apparently lost interest, sailing off into the sunset on his yacht named “Soak My Deck.” Somehow, he avoided any charges, much to the befuddlement of everyone following the case. His beloved yacht, at least, will likely be clawed back in the FTX bankruptcy.  

Tiffany Fong
Biggest gossip

Tiffany Fong is that rare kid who transferred to another school (ugh) but became popular enough to outshine the legacy cool kids—and get a hold of some of the school’s hottest goss. Back in the summer of 2022, she rose to prominence for posting about her trapped funds at a now-bankrupt crypto bank. SBF noticed her posts, and after he was extradited from the Bahamas, she became his confidant, regularly meeting him while he was under house arrest. His admissions to her led to a probe from the Federal Election Commission, and she leaked some of his private documents to the New York Times. “Talking to Sam over the last year and then attending the trial, it was pretty all-consuming, so I’m pretty much trying to reel back for now and enjoy my personal life a bit,” she told Fortune.

Photo-illustration by Fortune; book from Getty Images; portraits: John Marshall Mantel—The New York Times/Redux; Michael M. Santiago—Getty Images, David Levenson—Getty Images

Lewis Kaplan
The mean principal

Lewis Kaplan turned on the lights at the end of the party, revealing a floor littered with adderall bottles and vegan lentil packs. The judge overseeing Sam Bankman-Fried’s trial, Kaplan deflated the defendant’s case with withering quips and tired bemusement. While SBF was able to enchant investors, journalists, and employees with his constant stammering, Kaplan ran a no-nonsense courtroom, instructing the accused to stop squirreling around when he took the stand and answer prosecutors’ questions. After a jury found Bankman-Fried guilty of all charges, Kaplan will likely oversee his second criminal trial in March before deciding his fate.

Joe Bankman and Barbara Fried
PTA co-presidents

Being co-presidents of the PTA is tough work, but when their son’s paying pops $1 million a year for helping out with his school project (a crypto Ponzi scheme!), the stress is worth it. Although Joe Bankman and Barbara Fried didn’t receive a grade for their son’s failed venture, the Stanford law professors have received their fair share of criticism for enabling and supporting what a jury ultimately deemed fraud. Currently, they are fighting a lawsuit from the bankrupt FTX estate, and their criminal legal exposure is debatable. Daily attendants of their son’s first criminal trial, they will likely be back in the courthouse for his second in March. So much for a spring break.

Michael Lewis
He doesn’t even go here!

Every high school party has that one guy no one knows. Like, truly, that guy in the corner who doesn’t even go here! Michael Lewis, the acclaimed business writer, is that guy. But rather than tag along with Bankman-Fried and his friends for one night, he (figuratively) partied with them for two years. When Bankman-Fried’s trial started in October, Lewis released his chronicle of the rise and fall of FTX: Going Infinite. The book received mixed reviews, but Lewis doesn’t mind the haters. “It felt like there’s a tribe waiting that were natively hostile to the truth of the story I experienced,” he said in an interview with Time. “All you can do is write it; I can’t make stuff up to make you happy.”

Experts are calling the Ripple ruling a win for the industry. Here’s how lawyers—and Crypto Twitter—are reacting

As the dust settled, Crypto Twitter hailed the ruling as a win for the embattled industry. Judge Analisa Torres found that Ripple’s XRP sales to institutional investors, like hedge funds, were an investment contract, while its programmatic sales on open markets like exchanges were not. While the SEC will likely challenge the decision, and parts of the case still have to go to trial, the implications are vast. Many interpreted the ruling to mean that secondary sales of cryptocurrencies are not securities, which would undermine the SEC’s lawsuits against exchanges like Coinbase and Binance.

“There’s no way to look at the Ripple decision as anything but a win for the crypto industry,” said Christian Schultz, a former SEC division of enforcement assistant chief litigation counsel who’s now a partner at Arnold & Porter. “That could spell problems for the SEC in other pending litigation, particularly those that are focused primarily, if not exclusively, on secondary market activity.”

Schultz added that Torres’s decision on institutional sales supports the SEC’s position, but that the crypto industry would likely find creative ways to avoid that path for its initial distribution of tokens.

This view was widely shared by lawyers who provided comment to Fortune. “If upheld on appeal, this decision significantly narrows the SEC’s jurisdiction over the crypto market,” said Arthur Jakoby, co-chair of securities litigation and enforcement at the law firm Herrick.

Others highlighted the distinction Torres made that XRP itself is not a token, but its sale can be under certain facts and circumstances. Jeffrey Alberts, a partner at the law firm Pryor Cashman, said the question of whether cryptocurrency tokens were themselves securities had “has previously led to widespread confusion.”

Whether the ruling holds up during an appeal was another topic of discussion. Dr. Jiaying Jiang, a professor of law at the University of Florida, told Fortune that there is still room for argument around the decision on programmatic sales, adding that the specifics of XRP’s economic context may not apply to other cryptocurrencies, especially with the judge punting the larger question of secondary sales not directly from an issuer.

The SEC touted the judge’s ruling on institutional sales, responding in a statement that it was pleased with the court’s finding that “XRP tokens were offered and sold by Ripple as investment contracts in violation of securities laws in certain circumstances.”

Crypto Twitter’s victory lap

Amid the celebration, more level-headed members of Crypto Twitter provided caution on the decision, and particularly Torres’s seemingly radical argument that secondary sales did not constitute offering a security. In one tweet, now deleted, an attorney described the dilemma created by the case as “Shrodingers Shitcoin,” as altcoins sold to institutional investors like VC would require disclosure, while those sold to retail would not.

Justin Slaughter, policy director of the crypto VC firm Paradigm, said that the confusion created by the decision is the result of leaving digital asset regulation to the courts rather than Congress, arguing that the ruling would likely force otherwise hesitant lawmakers to the table.

Others spent less time on the legal nuance of the case, instead focusing on the implications for SEC Chair Gary Gensler, who has become a boogeyman for the industry. With the ruling representing the first meaningful loss for the agency on the question of crypto securities, previous targets of the agency’s ire expressed glee.

Not to be left out of the one-liners, New York Democratic congressman and crypto advocate Ritchie Torres noted the shared surname of the judge.

Hot takes aside, the ruling had immediate implications for the crypto industry, as exchanges from Coinbase to Kraken raced to re-list XRP. The token surged as high as 75%. For now, Crypto Twitter just seems ready for the weekend.

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