(1/2)On August 11, 2023, in a court in New York, the United States, Sam Bankman-Fried, the founder of the bankrupt cryptocurrency exchange FTX, arrived at the court. The lawyer was trying to convince the prosecutor responsible for his fraud case Judge not to jail him before trial.REUTERS/Eduardo Munoz// File photo with permission
NEW YORK, Oct 6 (Reuters) – Former FTX executive Gary Wang will return to court on Friday to continue testifying against his former roommate and boss Sam Bankman-Fried, who is accused of stealing data from cryptocurrency clients. Billion dollar exchange.
Wang, 30, is one of three FTX insiders who have pleaded guilty to fraud charges and signed cooperation agreements with the government. He and Bankman-Fried were college roommates and later co-founded the hedge fund Alameda Research.
Wang testified Thursday that while at FTX, he created software code under Bankman-Fried’s direction that gave Alameda “special privileges” allowing it to withdraw funds unlimitedly.
Prosecutors said these privileges were one of the main mechanisms used by Bankman-Fried to plunder customer assets, leading to the exchange’s collapse in November 2022.
Lawyers for Bankman-Fried said in opening statements on Tuesday that FTX was a new company and that Alameda was not just a regular customer of the exchange but a market maker, creating supply and demand in the exchange’s early years.
While Wang is the first cooperator to testify, the jury has heard from three other witnesses so far. A former FTX user testified that he was unable to withdraw funds after the exchange collapsed, and Matt Huang, head of a cryptocurrency-focused fund that invested in FTX, said he was told Alameda “did not receive preferential treatment” on the platform.
Adam Yedidia, a former FTX computer programmer who reported to Wang, testified that he expressed concerns to Bankman-Fried in mid-2022 after learning that Alameda had borrowed $8 billion from the exchange. He said Bankman-Fried appeared concerned and told him the companies were not as “vulnerable” as they had been the year before.
Zac Prince, founder of cryptocurrency lending company BlockFi, is one of the witnesses expected to testify when the trial resumes next Tuesday after the Crown Court is completed.
Reporting by Jody Godoy; Editing by David Gregorio
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