The criminal trial of Sam “SBF” Bankman-Fried entered its third day with Adam Yedidia, FTX developer and Bankman-Fried’s former MIT roommate, testifying about the $8-billion deficit FTX disclosed before its bankruptcy.
On October 5, at the United States District Court for the Southern District of New York, Yedidia discussed the association between the cryptocurrency exchange, FTX, and Alameda Research.
This connection is crucial in allegations of fraud against SBF. Yedidia revealed a bug in FTX’s code that made Alameda’s liabilities stay constant, causing an approximately $8 billion miscalculation.
When Yedidia asked SBF about rectifying the issue, the latter estimated it would take “six months to three years.”
Under Assistant U.S. Attorney Danielle Sassoon’s interrogation, Yedidia shared that he left FTX after discovering Alameda had misused customer funds to settle its loans.
READ MORE: DOJ Asserts Lack of Crypto Regulations Doesn’t Bar Charges Against Former FTX CEO
He also noted that Bankman-Fried had instructed him to discuss FTX’s code issues using the encrypted messaging app, Signal.
The app, which has an auto-delete feature, was promoted by SBF to the entire company.
Yedidia quoted SBF emphasizing the risks of retaining messages, especially if regulators unearthed unfavorable information.
Another significant revelation was Yedidia’s confrontation with SBF in the Bahamas concerning the $8-billion discrepancy.
The ex-CEO allegedly tried to provide assurances then. Furthermore, Sassoon’s queries probed Yedidia about Bankman-Fried’s intimacy with ex-Alameda Research CEO, Caroline Ellison.
Yedidia shared an awkward conversation where SBF confessed to their physical relationship and pondered dating her, to which Yedidia responded negatively.
Ellison will reportedly testify against Bankman-Fried, based on her plea deal.
The trial saw a twist in August when Judge Lewis Kaplan canceled SBF’s bail, convinced by the prosecution’s claims that he attempted to intimidate witnesses, including Ellison, by disclosing some of her personal diaries to journalists.
Starting with jury selection on October 3, the trial is set to continue till November.
Key witnesses, including Gary Wang, an FTX co-founder, might take the stand post-Yedidia.
The prosecution might also summon ex-FTX officials like Nishad Singh and Constance Wang.
Other Stories:
Kazakhstan’s Crypto Mining Industry on the Brink of Collapse as Energy Prices Soar
Bitcoin Holds Steady at $27,500 Amidst US Yield Surges and Dollar Volatility
