The Testimony of Sam Bankman-Fried in His Criminal Trial
The criminal trial of Sam “SBF” Bankman-Fried, the former CEO of FTX, is currently underway. During his testimony in a New York courtroom, Bankman-Fried denied having knowledge of any fraudulent activities at the crypto exchange.
Allegations Against Former CTO
Bankman-Fried suggested that the former chief technology officer at FTX, Wang, played a role in creating the “allow negative” button for Alameda Research. This feature allowed the crypto hedge fund to trade more funds than it had available. Bankman-Fried stated that he was unsure about the situation at the time and believed that the funds were either held in a bank account or sent to FTX in stablecoins.
Opinions on Former Co-CEOs
Bankman-Fried described former Alameda co-CEOs Caroline Ellison and Sam Trabucco as “a good team.” However, he criticized Ellison’s lack of experience in software development and risk management. He acknowledged her strengths in research and management but believed she had not focused enough on risk management.
Contradictory Testimonies
Bankman-Fried’s claims contradict the testimonies given by Wang and Ellison. Wang testified that Bankman-Fried had instructed him and another former FTX employee to implement the “allow negative” feature. Ellison stated that she had wanted to step down as CEO but was asked by Bankman-Fried to stay due to concerns about rumors regarding the firm’s financial health.
Bankman-Fried’s Lack of Crypto Knowledge
In earlier testimony, Bankman-Fried admitted to knowing very little about crypto when he launched Alameda. His defense lawyer highlighted this fact. The questioning of Bankman-Fried is set to conclude on October 30, after which the prosecution will have the opportunity to cross-examine him.
The Conclusion of the Trial
Bankman-Fried’s criminal trial is expected to conclude within a few business days, with closing arguments from both the prosecution and defense. After any necessary court proceedings, the jury will deliberate on the seven charges. It is worth noting that Bankman-Fried is also scheduled to face five more criminal counts in a second trial in March 2024. He has pleaded not guilty to all charges in both cases.
Hot Take: Bankman-Fried Denies Knowledge of Fraudulent Activities at FTX
In his testimony during his criminal trial, Sam Bankman-Fried, the former CEO of FTX, denied having any knowledge of fraudulent activities at the crypto exchange. He attributed certain features, like the “allow negative” button, to others within the company. However, his claims contradict testimonies from former employees. The trial is expected to conclude soon, and Bankman-Fried will face additional charges in a separate trial next year.
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