Former Alameda Research CEO Testifies about Sam Bankman-Fried’s Presidential Aspirations
Caroline Ellison, the former CEO of Alameda Research, recently testified against Sam Bankman-Fried, revealing that he had aspirations to become the president of the United States. Ellison admitted that customer funds were used to repurchase Binance’s stake in the FTX exchange.
Fraud and Presidential Ambitions
During her testimony, Ellison disclosed that Bankman-Fried believed there was a 5% chance of him becoming the US president. She stated that he shared his political and business ambitions with her throughout their three-year relationship. Additionally, Ellison accused Bankman-Fried of directing her to commit fraud, conspiracy to commit fraud, and money laundering, involving theft from FTX customers and investors.
Ellison’s Testimony and Bankman-Fried’s Charges
Ellison pleaded guilty to charges against her in December and has been cooperating with authorities. In contrast, Bankman-Fried has pleaded not guilty to all seven criminal charges he faces. Ellison revealed that approximately $14 billion was taken to pay lenders, following an initial estimate of $10 billion.
Allegations against Bankman-Fried
Bankman-Fried had a net worth of $32 billion but faced multiple charges after the collapse of FTX. Ellison is testifying against him as part of a cooperation deal that may result in a reduced sentence for herself. Bankman-Fried has been in jail since August after allegedly attempting to influence Ellison.
The Relationship between Ellison and Bankman-Fried
Ellison met Bankman-Fried while working at Jane Street before joining him at Alameda Research in 2017. During her testimony, she expressed surprise at the company’s poor condition, including significant losses and unhappy lenders. Ellison also mentioned her romantic relationship with Bankman-Fried, which began in 2020 and ended in 2022. She became the chief executive at Alameda and earned substantial bonuses.
Alameda’s Use of FTX Funds
Ellison revealed that Bankman-Fried established systems that allowed Alameda Research to withdraw unlimited amounts of money from FTX accounts. He instructed executives to use FTX funds to repay their loans. Although Alameda Research withdrew up to $14 billion from FTX, Ellison claimed that some of it was eventually repaid. The funds were also used for political donations, including $35 million to Republican candidates and $10 million to President Joe Biden’s campaign.
Concerns about Binance and FTX
Ellison mentioned Alameda’s involvement with Binance, stating that they would withdraw funds from FTX and sell them on Binance if the coin was trading at a higher price there. She admitted that she initially believed customers were unaware of this practice. Additionally, Alameda used $1 billion of FTX customer funds to repurchase Binance’s stake in FTX, as Bankman-Fried feared potential trouble caused by Binance.
Hot Take: Bankman-Fried’s Presidential Aspirations and Allegations of Fraud
Caroline Ellison’s testimony against Sam Bankman-Fried has shed light on his presidential ambitions and alleged involvement in fraud, conspiracy, and money laundering. Ellison revealed that Bankman-Fried had aspirations of becoming the US president and shared his ambitions with her during their relationship. She also accused him of directing her to commit fraudulent activities involving theft from FTX customers and investors. These allegations raise serious concerns about Bankman-Fried’s integrity and trustworthiness, casting doubt on his leadership abilities. It remains to be seen how these revelations will impact the ongoing legal proceedings and Bankman-Fried’s reputation in the crypto community.
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