Disgraced crypto currency trader Sam Bankman-Fried has been admonished by a judge for violating the terms of his house arrest by using unauthorised means to communicate with the outside world.

US District Judge Lewis Kaplan, who oversees the case has signalled  that he might jail the 30-year-old Bankman-Fried for testing the limits of his $US250 million ($A369 million) bail package.

Federal prosecutors have asked that he be allowed only a basic “flip phone” with no internet capability and a laptop with limited functions while being forbidden the use of other electronic communication devices, the US Department of Justice says.

The proposal to limit the indicted FTX cryptocurrency exchange founder’s communications was filed in Manhattan federal court, on behalf of the government and Bankman-Fried’s defence team.

Back with his parents

Judge Kaplan said he did not want to set Bankman-Fried “loose in this garden of electronic devices,” following accusations that Bankman-Fried tried to contact possible government witnesses and used a virtual private network to watch football.

Bankman-Fried pleaded not guilty after prosecutors said he stole billions of dollars of FTX customer funds to plug losses at his Alameda Research hedge fund. He faces 12 criminal charges under an indictment made public on February 23.

The proposed non-smartphone for Bankman-Fried would be limited to voice calls and SMS text messages.

Laptop internet use would be restricted to specified virtual private networks, 23 websites for personal use covering news, including Reuters, sports and food delivery, and websites to help Bankman-Fried prepare for his scheduled October 2 trial.

Bankman-Fried is living under house arrest with his parents, both Stanford Law School professors, in Palo Alto, California.

The parents agreed to submit sworn affidavits that they would not bring other electronic devices into their home or let their son use theirs.

They also agreed that each device would carry software that periodically takes videos or photos of the user, which court officers would be allowed to review, the letter said.

Bankman-Fried’s lawyers did not immediately respond on Saturday to requests for comment.

-AAP