Gary

FTX co-founder and former Chief Technology Officer Gary Wang continued his testimony during the SBF trial on Friday, revealing more details on the secret relationship between FTX and Alameda Research. The trial will resume next Tuesday, and Caroline Ellison, former CEO of Alameda Research and ex-girlfriend of SBF, will make her appearance at the court.
Wang told the jury about some of Alameda's special advantages on FTX on Friday, including the ability to make trades quickly and without collateral, a $65 billion line of credit, and the ability to avoid having its account liquidated and closed. Alameda had the only account on FTX that was allowed to have a negative balance. Even if the balance was negative, Alameda could still withdraw funds. Its line of credit limit was initially set at $1 billion but was eventually increased to $65 billion.
"Sam told me to make sure Alameda's accounts would never get liquidated on FTX," Wang said, adding that SBF ordered him to write the code to allow Alameda to have a negative balance as early as 2019. At first, the funds Alameda could withdraw couldn't exceed FTX's revenue, but eventually, its debt went far beyond the number. According to Wang, Alameda owed FTX about $11 billion.
Apart from having special advantages, Alameda also absorbed some of FTX's losses. Due to the conflicts of interest between the two companies, SBF proposed to shut down Alameda Research in September 2022 but gave up the plan later because Alameda's liability was too big.
SBF's lawyer, on the other hand, tried to argue that the advantages Alameda had were necessary for Alameda and FTX to operate properly during the cross-examination with Wang, who will be asked more questions by the lawyer next Tuesday.
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 4: More Details on FTX's Relationship with Alameda Exposed, SBF's Ex-Girlfriend to Testify Next Week

TokenInsight

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