Sam Bankman-Fried Orders ‘Exclusive Rights’ to Alameda Label on FTX – Gary Wang
Gary Wang, FTX co-founder and former chief technology officer, appeared in court on the fourth day of the criminal trial of former CEO Sam “SBF” Bankman-Fried to speak again about the relationship between the crypto exchange and Alameda Research.
According to reports from Inner City Press, Wang returned to the New York court on October 6 and testified that he was the only person allowed to trade more than his Alameda account on FTX – a feature called “Negative Allow.” It has reportedly commissioned former chief technology officer Bankman-Fried Wang and former FTX director of engineering Nishad Singh to implement the feature in 2019.
The addition of “allow negative” to the FTX code, according to Wang, allowed Alameda to have a negative balance that is greater than FTX revenue in 2020 – $200 million versus $150 million. Banman-Fried testified that he made a $65 billion loan to Alameda, despite conflicting statements to the public about the relationship between the two firms.
“We thought we wouldn't use that kind of money,” Wang said, according to reports. “After I said Alameda's accounts were closed for billions, [SBF] He asked to meet in the Bahamas office. He asked me about the mistake and then told Caroline. [Ellison] Alameda can go ahead and pay back what he owed.
According to Wang, Banman-Fried Alameda's “exclusive rights” to FTX revolved around the exchange FTX Token (FTT), which the company used to trade “when the account balance was below zero.” Alameda, the former technology officer, testified that he was able to withdraw money directly from FTX.
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At the center of prosecutors' case against Bankman-Fried are allegations that the former CEO was responsible for using FTX user funds in Alameda without clients' consent. In testimony on Oct. 5, Wang admitted to committing crimes with Bankman-Fried and former Alameda CEO Caroline Ellison, who pleaded guilty in December 2022 to fraud charges.
Related: FTX Miner Moves $36.8M in Ether as Sam Bankman-Fried Trial Begins
“The SBF trial is not about crypto, just like the Elizabeth Holmes trial is not about forensics,” Sheila Warren, CEO of the Crypto Council for Innovation, told Cointelegraph. “Sam is showing a remarkable and sustained implosion, and as this experiment continues, we expect to see more evidence that Sam was primarily for himself.
Bankuman-Fried's criminal trial is expected to continue into November, as Ellison and Singh are likely to testify against the former CEO. Amid court appearances, SBF will remain in custody pending trial after Judge Louis Kaplan revoked his bail in August. It's unclear if Bankman-Fried plans to take the stand himself.
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