FTX’s founder stuck to his guns on who to blame for Alameda’s spending and use of customer funds during the third day of his testimony in United States v Sam Bankman-Fried.
Day 15 and Sam Bankman-Fried’s third day on the stand displayed numerous questions from assistant United States attorneys. Simultaneously, the FTX founder’s lawyers’ direct examination elicited answers that all but blamed Caroline Ellison for Alameda Research’s unchecked use of FTX customer crypto and assets.
Bankman-Fried said Ellison, ex-CEO of Alameda, admitted to subpar hedging at the crypto trading firm and tendered her resignation. Eventually, the pair moved forward with running FTX and its sister firm Alameda with the intention of repairing the businesses.
In September, I asked her again about hedging. I asked what the scale was. She gave me some numbers. I told her I was glad but that it should be a bigger number, at least twice as much. She also sent me some spreadsheets.
Sam Bankman-Fried, FTX founder
Previously Ellison testified to preparing some seven to eight misleading spreadsheets for Bankman-Fried as executives haggled with crypto lenders and tried to hide gaping holes in Alameda and FTX’s balance sheet.
Between Nov. 2 when Alameda’s financial records leaked and Nov. 7, after Ellison offered to buy Binance’s $2 billion FTT trove at $22, net withdrawals increased from $1 billion to $4 billion according to the defendant as noted by InnerCityPress.
Cohen: How did you respond?
SBF: Caroline sent a tweet, that we would buy FTT at $22
Cohen: Nov 7, what did you observe as to withdrawals?
SBF: They increased. On Nov 7, $4 billion of net withdrawals, 100 times an average day. We might be at a liquidity crisis
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Author: Naga Avan-Nomayo
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