Gary

Partner

The trial of SBF continued on October 5, as multiple witnesses, including SBF's former friends and business partners, testified. Gary Wang, co-founder of FTX who has pleaded guilty, admitted that SBF committed financial crimes alongside several former FTX executives.
Wang said, "We gave special privileges to <a target="_blank" href="https://tokeninsight.com/en/capitals/alameda-research">Alameda Research</a> to allow it to withdraw unlimited funds from FTX and lied about it." Even if Alameda Research's account had a negative balance, it could still withdraw FTX customers' deposits. In addition, the FTX sister company had a line of credit that was "essentially without any limit", and could place orders slightly faster than other market makers.
Adam Yedidia, a former senior developer at FTX who used to be SBF's housemate, testified that SBF knew about FTX's liability problems almost a half year prior to the collapse. According to Yedidia, some FTX customers deposited fiat for their exchange account by wiring money to an Alameda-owned bank account, which made it harder for FTX to track debts. Last year in June, a bug in FTX's software code made the accounting incorrectly show that Alameda Research owed FTX customers $16 billion, while the actual liability was $8.7 billion. After fixing the bug, Yedidia expressed his concerns to SBF, who replied, "We were bulletproof last year, but we’re not bulletproof this year."
In addition, Matt Huang, co-founder of FTX's investor <a target="_blank" href="https://tokeninsight.com/en/capitals/paradigm">Paradigm</a>, testified that SBF once told him Alameda Research had no preferential treatment on the FTX exchange. Paradigm's investment in FTX has been marked to zero.
To learn more, please read: <a target="_blank" href="https://tokeninsight.com/en/news/topic/the-trial-of-sbf">the Trial of SBF</a>
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SBF Trial Day 3: Former Business Partner Confirms SBF Allowed Alameda Research to Withdraw FTX Customers' Funds

TokenInsight

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