Evidence Suggests Binance Responsible for Leaking Alameda Research’s Balance Sheet
During Sam Bankman-Fried’s trial, evidence was presented indicating that he held Binance accountable for leaking a balance sheet for Alameda Research to CoinDesk. This incident played a crucial role in the collapse of FTX and Bankman-Fried’s crypto empire.
Alameda CEO Testifies About Bankman-Fried’s Memo
Former Alameda CEO Caroline Ellison testified that Bankman-Fried had prepared a memo outlining potential investors to approach for a bailout. In the document, Bankman-Fried accused Binance of engaging in a PR campaign against FTX and leaking the balance sheet to CoinDesk.
The Impact of the CoinDesk Report
CoinDesk reported on November 2, citing the leaked balance sheet, that FTX’s sister trading firm was facing instability. This report was considered a catalyst for the collapse of FTX and triggered a series of detrimental events in the crypto industry.
Bankman-Fried’s Strategies During the Crisis
In his memo, Bankman-Fried listed Justin Sun, founder of TRON and advisor of Huobi exchange, as a potential investor. However, he noted that Sun was close to CZ, likely referring to Changpeng Zhao, the CEO of Binance. Bankman-Fried also mentioned sending a confident tweet thread as one of his planned actions during this period.
FTX’s Liquidity Situation
The document revealed that although FTX was capitalized, it lacked infinite liquidity. Ellison clarified that out of the $12 billion in client assets on the exchange, only $4 billion was available for processing withdrawals.
Bankman-Fried’s Legal Troubles
Bankman-Fried is currently facing seven fraud charges in the ongoing trial. He will also face a separate trial in March 2024 on charges including bank fraud and foreign bribery conspiracy. Ellison is scheduled for cross-examination by the defense.
Hot Take: Binance’s Alleged Role in FTX’s Collapse
Evidence presented during Sam Bankman-Fried’s trial suggests that Binance played a significant part in the collapse of FTX. The leaked balance sheet, which was reported by CoinDesk, triggered a chain of events that led to the downfall of Bankman-Fried’s crypto empire. The trial will continue to shed light on the details surrounding this incident and determine the outcome of the charges against Bankman-Fried.
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