FTX founder Sam Bankman-Fried as soon as once more took the stand in his ongoing legal trial in New York on Oct. 30, this time to face cross-examination by prosecutors.
Assistant U.S. Lawyer Danielle Sassoon started by figuring out the extent to which Bankman-Fried was concerned with FTX’s sister agency, Alameda Analysis.
Bankman-Fried admitted to proudly owning 90% of Alameda. Nonetheless, he largely denied that he was concerned in Alameda buying and selling in 2022, stating:
“Relies on the way you outline buying and selling … I’d not say I used to be not concerned in any method.”
Bankman-Fried in any other case stated that he was “not concerned as a basic precept” in Alameda’s each day buying and selling however took half in high-level discussions. He stated that he supplied Caroline Ellison, then the CEO of Alemeda, with some enter on buying and selling; particularly, he admitted that he gave Ellison some directions associated to Japanese authorities bonds.
One other part of the cross-examination largely centered on whether or not Bankman-Fried had promised to offer clients with a protected buying and selling service. Regardless of these assurances, he additionally made statements suggesting a disregard for person protections — with Sassoon highlighting the truth that Bankman-Fried stated “f–ck regulators” in a single interview.
SBF on Alameda’s particular remedy
Sassoon raised the query of whether or not FTX handled Alameda Analysis in another way from its different clients.
Earlier testimony from former FTX associates urged that Alameda was allowed to have particular privileges akin to a damaging stability and limitless credit score line. Bankman-Fried admitted that almost all clients wouldn’t be allowed a long-lasting limitless damaging stability. He additionally didn’t deny that Alameda may withdraw billions of {dollars} from FTX utilizing a line of credit score with out falling below FTX’s automated liquidation procedures.
He additionally stated that clients had been solely “typically” allowed to make use of exterior investments as collateral, figuring out Three Arrows Capital affiliate Crypto Lotus as one instance. Alameda typically used FTX’s FTT token as collateral, based on different stories.
Although he recognized these cases of particular remedy, Bankman-Fried typically testified that he was unable to recall whether or not he had beforehand stated that Alameda was handled the identical as different clients. Sassoon requested a number of inquiries to that impact.
Bankman-Fried however admitted to stating, at one level previous to his firm’s collapse, that Alameda “had the identical entry as different clients.”
Bankman-Fried remained below cross-examination on the time of writing.
