Sam Bankman-Fried, the former CEO of collapsed crypto alternate FTX, stays on trial for alleged fraud and conspiracy as he led the corporate’s swift rise and implosion. We’re now in the midst of the path’s second week, with a few of the highest-profile witnesses offering their testimony on SBF’s conduct, FTX’s enterprise practices and alleged cash laundering.
Up to now within the second week, the standout testimony has come from Alameda Analysis’s former CEO Caroline Ellison, who claimed she took $14 billion from prospects to repay money owed to lenders, utilizing them as a line of credit score below the instruction of SBF. And although there are not any fees of bribery within the case, Ellison additionally testified to paying Chinese language officers $150 million to revive entry to $1 billion in frozen buying and selling accounts.
Our resident crypto professional Jacquelyn Melinek, our professional on all issues crypto, painted a full image of the testimony as she continues to cowl the trial from throughout the courtroom, because the highest-profile legal case tied to the trade marches on throughout the Manhattan Federal Court docket. Between stints within the locked-down courtroom, she’ll be posting to X, as effectively.
For these in want of a refresher on the case, her breakdown of how FTX went from the third-largest crypto alternate valued at a peak of $32 billion to chapter will get you up to the mark. Or in the event you’re right into a deeper dive into week one particularly, you’ll be able to learn extra evaluation right here.
You can too comply with alongside together with her and the crypto-news workforce’s protection within the Chain Response e-newsletter, which drops Thursdays at 12 pm PT, and the Chain Response podcast, which is able to hit your feed each Thursday.
Learn how to comply with the SBF trial
The trial itself is anticipated to final no less than six weeks, kicking off with jury choice on Tuesday, October 3. From there, entry to the proceedings is proscribed, as no gadgets are allowed; studies are being bodily put collectively throughout the courtroom.
Past our every day protection, extra experience and commentary will dwell on crypto-news+. There, you’ll find tales like this in-depth breakdown of what to anticipate from each side of the SBF case, the place the prosecution and protection might acquire floor or fall quick of their arguments and what the takeaways had been from the opening arguments.
SBF trial: What we realized within the first week
As anticipated, the opening statements within the SBF trial had been spicy. The prosecution painted an image of an empire “constructed on lies” and made some extent to point out precise footage of SBF alongside wealthy and highly effective figures for example the height of his energy and affect previous to FTX’s implosion.
“This man stole billions of {dollars} from 1000’s of individuals,” prosecutor Thane Rehn advised the courtroom. “He defrauded refined buyers and lenders, and he emptied the accounts of atypical prospects, too. He purchased himself wealth, energy and affect.”
The protection, however, depicted SBF and his colleagues as in over their heads, with out ill-will as FTX collapsed round them.
“Sam and his colleagues had been constructing the aircraft as they had been flying it,” protection lawyer Mark Cohen stated. “They’d to determine methods to navigate a world the place they had been working FTX, constructing out its programs, coping with hacking threats, managing the credit score threat of their prospects, managing lots of of workers, all whereas build up their precise alternate.”
Learn a recap of the prosecution and protection’s full arguments right here.
FTX’s co-founder and CTO Gary Wang testified Thursday on the extent to which Alameda Analysis was used for no matter functions he and SBF noticed match. The crypto buying and selling agency, in keeping with Wang, pulled funding straight from FTX prospects, whose transactions can be funneled towards Alameda after which directed elsewhere.
Verify right here for our rundown of Wang’s testimony to this point, ensuing from a responsible plea in December 2022. Wang’s testimony is ready to conclude on Friday.
Thursday additionally introduced in testimony from Matt Huang, co-founder and managing companion at crypto funding agency Paradigm. That agency invested $278 million in FTX throughout 2021 and 2022, and is a part of a class-action lawsuit accusing it and others of defrauding prospects by selling FTX.
His testimony centered round being left uninformed about FTX’s utilization of buyer cash to maintain the Alameda Analysis afloat, a observe that Huang says would have halted his involvement. The total breakdown of his testimony on his relationship with FTX, stretching again to 2019, might be discovered proper right here.
We additionally obtained a take a look at the composition of the SBF trial’s jury, which ranges from a practice conductor to a retired funding banker who attended Stanford College. You’ll be able to take heed to a particular joint episode of our podcasts Fairness and Chain Response to get a greater sense of the vibe between the jurors and the remainder of the courtroom.
Earlier within the week, we obtained affirmation that at no level did the U.S. authorities provide SBF a plea provide.
For a full rundown of our protection of the SBF trial, test beneath:
