Original author:Helene Braun、Elizabeth Napolitano，Coindesk
Original compilation: Wang Eryu, PANews
FTX founder SBF is on trial this week for allegedly stealing billions from the collapsed crypto exchange.
Key witnesses include former colleagues and friends, notably Caroline Ellison and Gary Wang, both of whom have close ties to FTX and Alameda Research. SBFs former sweetheart Ellison was well aware of FTXs inner workings and has admitted to misleading conduct.
Witnesses Nishad Singh and Wang, who held senior positions at FTX and Alameda, have pleaded guilty to related charges.
Nearly a year since the collapse of global crypto exchange FTX, its founder and former CEO Sam Bankman-Fried has been disgraced. This week he will try to convince a jury of his peers to let him go free. But first, well hear from some of his closest friends.
During the six-week trial, prosecutors will delve into testimony, internal documents, emails and mountains of evidence to reveal clues that the crypto exchange allegedly stole billions of dollars in customer funds. Perhaps the most compelling evidence comes from prosecutors witnesses: former friends and allies of the SBF.
After reaching a plea agreement with the U.S. Department of Justice, several former colleagues and friends of SBF will appear in court to accuse the former crypto tycoon, including his former lover Caroline Ellison and hair boy Gary Wang, who were all deeply involved in FTX and its quantitative trading. The day-to-day operations of the fund Alameda Research. Two other people, who have not yet been named, may testify after being granted immunity, suggesting they may also have ties to the exchange. The U.S. Department of Justice also announced over the weekend that prosecutors plan to call former FTX customers and investors from around the world as witnesses during the trial.
witness
Caroline Ellison: Former Alameda CEO, pleaded guilty
One of the highest-profile witnesses is Caroline Ellison, who is expected to line up against the SBF. Court documents show that as the former head of Alameda Research, a crypto hedge fund linked to FTX, she will disclose the relationship between the two companies and the amount of FTT held by FTX. In addition, since she was in a relationship with the founder of FTX, there may be some vulgar gossip. She is said to be one of the few insiders who truly knows whats going on inside FTX.
Ellisons parents were both MIT economists, and she and SBF met at their previous employer, the Wall Street-focused trading firm Jane Street. The two reunited in October 2021, and SBF convinced her to join his crypto company at a Bay Area coffee shop.
In December 2022, during a plea hearing shortly after FTX collapsed, Ellison admitted to intentionally misleading lenders and obtaining an unrestricted line of credit without posting collateral through FTX for her then-hedge fund Alameda Research, Even though the company didnt need the money at the time.
Ellison pleaded guilty to the fraud charges and entered into a plea agreement with no tax crimes. Her knowledge of FTX and Alameda’s alleged sharing of client funds could become a key point in the trial.
She is also considered the person who knows SBF best on a personal level, given her former relationship with the former crypto tycoon, which ended in February 2022, according to her diary, and SBF reported to SBF in August The New York Times leaked that diary. (Related Reading:FTX executives’ latest inside story revealed: SBF “maliciously” disclosed ex-girlfriend’s private diary and planned to buy an island for “refuge”）
She wrote primarily about her feelings about SBF and how her many on-and-off relationships affected her work at Alameda Research, writing, It felt painfully close to [him].
Although she did not mention any living status in her diary, it is understood that Ellison and other FTX employees lived with SBF in a $40 million penthouse in Albany, Bahamas.
This makes Ellison one of the few insiders who seems to be involved with SBF both professionally and emotionally, giving her a unique perspective to talk about the former FTX founders ethics as a businessman, as well as on a personal level. character traits.
Nishad Singh: Director of Engineering at FTX, pleaded guilty
Nishad Singh was another early employee of Alameda Research, when the trading firm was still headquartered in an apartment in Berkeley, Calif., with only four other employees. Singh, who was close to his brother from SBF in high school, served as director of engineering at Alameda and, like Ellison, lived with SBF in its 10-person luxury penthouse in the Bahamas. After a year and a half at Alameda, he took on the role of head of engineering at the newly launched FTX derivatives exchange, where he had very little responsibility.
Singh is reportedly one of three people who holds the keys to FTX’s matchmaking engine. The FTX matching engine is the system that facilitates the exchanges processing of buy and sell orders, allowing holders of keys to move funds as they please. He was also aware of FTX lending client funds to Alameda. Like Ellison, he pleaded guilty in February to six criminal charges, including fraud and conspiracy.
Gary Wang: Co-founder of Alameda Research and FTX, pleads guilty
Gary Wang is the co-founder of Alameda Research and FTX and the right-hand man of SBF. Gary Wang has served as CTO of both companies and is known as a key player in FTX.
Wang also knows SBF well on a personal level; the two were high school math summer camp buddies and roommates at MIT. He was also one of 10 roommates in the Nassau penthouse where SBF lived. The Commodity and Trade Commission (CFTC) said Wang allowed Alameda to maintain a substantially unlimited credit line with FTX.
In December 2022, Wang and Ellison jointly pleaded guilty to charges related to the FTX collapse.
Andria van der Merwe: Economist, Survey of Financial Market Regulation
Andria van der Merwes resume on the website of consulting firm Compass Lexecon lists her as an economist specializing in complex financial market regulatory investigations. As an expert in financial regulation and market risk, she is expected to provide insight into how SBF and its inner circle allegedly conspired to violate federal securities and commodities laws. She is also likely to testify on the impact of the FTX collapse on the broader financial markets.
Peter Easton: Professor at the University of Notre Dame
Prosecutors say Notre Dame professor Peter Easton will outline the financial health of Alameda Research and FTX, including Alameda’s balance sheet issues that triggered the collapse of SBF’s multibillion-dollar crypto empire. His testimony will discuss how client funds were held and whether actual bank account balances matched FTX’s internal ledger balances.
defense witness
Thomas Bishop: Corporate consultant specializing in forensic investigations and accounting issues
Tom Bishop is a corporate consultant specializing in forensic investigations and accounting issues. The court filing did not reveal much about his planned testimony, other than that he may discuss FTX and Alameda’s “financial numbers and metrics based on “publicly available documents and records, including but not limited to Alameda’s balance sheet.” calculation. Defense attorneys said they plan to subpoena Bishop to rebut potential Justice Department testimony if necessary.
Brian Kim: Data Analysis and Forensics Expert
Brian Kim, an expert in data analysis and forensics, may talk about internal communications between SBF and employees at FTX and its sister companies. If called to court, he could testify about the content, metadata and file paths associated with Slack data and Google Docs that allegedly prove SBF directed employees to destroy evidence of the companys alleged fraud. The data includes [file and message] fields listing the author, custodian(s) and viewer(s), as well as the dates the content was created, modified, viewed, saved and/or deleted, according to court documents. Like Bishop, Kim will focus on rebutting the Justice Departments testimony if called to testify.
Joseph Pimbley: Financial Risk Management Expert
Financial advisor Joseph Pimbley is an expert in financial risk management. He is likely to tell the jury during his testimony that FTXs software infrastructure ... has insufficient robustness of reporting mechanisms and insufficient testing and quality assurance of data integrity and code, according to court documents. External users like SBF This cannot be seen or easily discovered. Defense lawyers said they planned to subpoena him to rebut Wang and Singhs testimony.
Andrew Di Wu: Professor of Finance and Technology, University of Michigan
Andrew Di Wu, a professor of finance and technology at the University of Michigan, is likely to give the jury an overview of how cryptocurrency exchanges and the blockchain technology behind them work. He may also tell the court in his testimony the unique complexities of operating a centralized cryptocurrency exchange, particularly one involving cross-border operations... as well as the challenges of handling multiple fiat currencies and cryptocurrency transactions, according to court documents. . The defense said Di Wu may take the stand in response to testimony given by an FBI agent to prosecutors.
Pending witness
As of September 29, a number of key executives and other individuals close to SBF had not been publicly named as possible witnesses, including several key figures at FTX.
Sam Trabucco: Former Co-CEO of Alameda Research
Before Caroline Ellison takes over as sole CEO of Alameda Research, she shared the role with Sam Trabucco, who left in August 2022 after just one year. In 2021, he posted on huge profits. Trabucco was not named in a Wall Street Journal article last year as one of the executives who knew of FTXs transfer of client funds to Alameda.
Dan Friedberg: Former FTX Chief Compliance Officer
Daniel Friedberg served as Chief Compliance Officer of FTX from March 2020 to November 2022. He was previously associated with an online poker site that was embroiled in a scandal in which an estimated $20 million in funds was misappropriated, and he reportedly told an ally to place the blame on an undisclosed person at the company. Name of consultant. He joins FTX after becoming a partner at Fenwick West LLP, where he led the cryptocurrency group.
In November, he reportedly provided details about FTX to federal prosecutors. Although his name has not been confirmed, he is expected to be called as a government witness at the SBF trial, Reuters reported. His lawyer did not answer calls seeking comment.
Ryan Salame: Co-CEO of FTX Digital Markets, pleaded guilty
Ryan Salame, co-CEO of FTXs Bahamian subsidiary FTX Digital Markets, became the fourth executive from SBFs inner circle to plead guilty to federal charges when he accepted a plea deal this fall.
Campaign finance records show that Salame was directed by the SBF to make millions of dollars worth of illegal campaign contributions to dozens of U.S. members of Congress. But while Salame helped his former boss gain influence on Capitol Hill, he claims he knew nothing about the severity of FTXs financial woes or the alleged crimes of its executives. Related Reading:(Another former FTX executive pleads guilty to helping SBF secretly fund Republican elections, and may have up to $1.5 billion in assets confiscated）
Salame has reportedly submitted documents related to the FTX debacle to federal prosecutors, but the New York Times reports that he will not testify. An earlier court filing said he would invoke his Fifth Amendment right against self-incrimination if subpoenaed.
