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Wang’s testimony was part of a plea agreement with prosecutors resulting from his guilty plea filed in December 2022.
An interesting turn of events in the ongoing criminal trial of ftx Founder Sam Bankman-Fried (sbf), the company’s former chief technology officer Gary Wang made shocking revelations about the inner workings of the exchange and its sister company Alameda Research.
On the third day of the trial, October 5, Wang took the stand after a short break and revealed important information about the cooperation between FTX and Alameda, stating that he was given “special privileges from Alameda Research”. Were.
FTX allows Alameda to withdraw unlimited funds
From Wang’s testimony, the privileges included an extensive line of credit, allowing the company to place orders directly on FTX and execute transactions faster.
“We allowed Alameda to withdraw unlimited amounts of money,” Wang said in response to questions from Assistant United States Attorney Danielle Sassoon.
He also claimed that Alameda could withdraw unlimited amounts of money from the exchange. Following its collapse in November, the company removed $8 billion from the platform and pulled $65 billion on its credit line.
According to a series of positions Wang’s testimony on Twitter, formally Inner City Press, also highlighted his involvement in various illegal activities including wire fraud, securities commodities fraud during his tenure at FTX.
Wang further revealed that Bankman-Fried, former Alameda Research CEO Caroline Ellison, and former FTX engineering director Nishad Singh were his co-conspirators in these crimes.
SBF is responsible for all decision making in FTX
While on the stand, he emphasized that while he focused on coding, Bankman-Fried handled public-facing duties, including media interactions, lobbying, and discussions with investors.
He also claimed that despite not participating in the coding, SBF always instructed him on what to implement in the code.
The former FTX employee explained that despite disagreements on some of the SBF’s instructions, the final decision-making authority rested primarily with Bankman-Fried. It turned out that:
,[Sam handled] Talking to the media, lobbying, talking to investors. I just coded […] In the end it was Sam’s decision [regarding any disagreements],
Wang’s testimony was part of a plea agreement with prosecutors stemming from his guilty plea filed In December 2022. It is expected that Ellison and Nishad, who pleaded guilty last year to the same criminal charges as Wang, will testify against SBF before the trial ends in November.
Former FTX employee found a flaw on the exchange
The former FTX CTO is not the only one who has represented himself in the ongoing lawsuit in the United States District Court for the Southern District of New York.
On the same day as Wang, Adam Yedidia, another former FTX employee and SBF’s former roommate at MIT, testified in the courtroom about his knowledge of the company’s misuse of funds. According to reports From Inner City Press, Yedidia, who worked as a software developer at FTX, resigned when he learned that Alameda had used customer deposits to pay off his loans.
Before leaving the company, the former MIT student discovered a bug in FTX’s code that gave Alameda access to FTX customers’ funds. He said the bug ensured “that Alameda’s liabilities were not reduced”, resulting in an error of approximately $8 billion.
He also revealed that while answering questions from Assistant US Attorney Danielle Sassoon, the SBF asked him to use a social media platform called Signal to discuss the bug case.
“They told me to use Signal. He told the entire company. It also had auto-delete. […] he said this [auto-delete] That was all the downside to keeping the messages around. If regulators find things they don’t like, it could be bad for the company,” he said.
So far, these witnesses have addressed significant portions of the lawsuit regarding FTX’s involvement with Almada, validating allegations that the exchange misused client funds to keep the company afloat under SBF’s leadership. .
Chimamanda is a crypto enthusiast and experienced writer who focuses on the dynamic world of cryptocurrencies. She joined the industry in 2019 and has since developed her interest in emerging economies. She combines her passion for blockchain technology with her love for travel and food, bringing a new and fascinating perspective to her work.
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