FTX and Sam Bankman-Fried's trial: The players

The collapse of cryptocurrency exchange FTX erased around $1 billion in customer funds and is often compared to high-profile frauds such as Enron and Bernie Madoff’s Ponzi scheme. 

Federal prosecutors told jurors this week that founder and former CEO Sam Bankman Fried’s power and influence was “built on lies,” saying he stole billions of dollars from thousands of customers and only his friends and girlfriend Caroline Ellison knew the truth about what was happening. Additionally, The Wall Street Journal reported that some U.S. employees of FTX discovered the backdoor that Alameda Research used to withdraw billions of dollars in customer funds months before the actual collapse of the exchange. 

In the courtroom, Bankman-Fried appeared to have had a haircut and was dressed in a gray suit, according to FOX Business. He also was the only individual at his table that had a laptop. 

In the weeks leading into FTX’s collapse and the days after, bitcoin, the largest cryptocurrency by market value, fell below $16,000 and has since clawed back to the $27,000-$29,000 level. 

BITCOIN NEARLY 1-YEAR AFTER FTX COLLAPSE

Ellison, the former CEO of FTX sister company Alameda, was once the girlfriend of Bankman-Fried and later was one of his roommates in the $300 million Bahamas property. 

She is now expected to play the role of star witness against her former lover. 

Ellison is a graduate of Stanford University and both her parents are educators at MIT. 

She met Bankman-Fried at the trading firm Jane Street Capital. Bankman-Fried, like Ellison, was raised by professors and the pair embraced the philosophy of “effective altruism,” which involves making large sums of money to fund philanthropic pursuits that benefit society to the greatest extent possible. The two reportedly were involved in an on-and-off relationship, according to CoinDesk.

Alameda was a major trader in the cryptocurrency space and traded frequently on FTX’s platform, according to The Wall Street Journal. Though Bankman-Fried was the founder and majority owner of Alameda, he eventually ceded control of its operations and focused primarily on his role as the chief executive of FTX. At its peak, FTX amassed a valuation of roughly $32 billion and was the world’s third-largest cryptocurrency exchange by volume. 

In October 2021, Ellison was named co-CEO of Alameda with Sam Trabucco. 

Bankman-Fried’s parents, Barbara and Joseph, are law professors at Stanford University and are expected to play a critical role in the trial. Last month FTX sued the duo alleging they, in advisory roles at the exchange, “fraudulently transferred and misappropriated” millions of dollars. 

Some of the funds were directed to a political action committee connected to Fried. Additionally, the parents received a deed to a Bahamas property.

FTX SUES PARENTS OF SAM BANKMAN-FRIED FOR TAKING MILLIONS IN PAYOUTS

The former FTX coder and college roommate of Sam Bankman-Fried testified how customers deposited money into FTX, but it was actually an Alameda bank account. The funds would turn up in the customer’s FTX account on its website. However, roughly $8 billion stayed with Alameda, never making its way to FTX despite the balances indicating it had. Yedidia noticed the glitch while fixing a bug on the website and alerted Bankman-Fried who said the company was no longer bulletproof. He also testified, expressing concerns he may have “unwittingly written code that contributed to the commission of a crime.” 

The details were compiled as part of FOX Business’ monitoring of the trial and testimony this week.

Prior to Brady and Bundchen’s very public divorce, the two starred in a television commercial for FTX. Brady was also a participant at a crypto conference and was reportedly paid millions by Bankman-Fried.

“He paid Tom Brady $55 million for 20 hours a year for three years. He paid Steph Curry $35 million for – same thing for three years,” author Michael Lewis told “60 Minutes” during an interview that aired Sunday. Lewis details the rise and fall of FTX in his new book entitled “Going Infinite,” which was released this week. 

The couple reportedly lost $30 million after FTX imploded.

TOM BRADY PAID MILLIONS BY SAM BANKMAN-FRIED-MICHAEL LEWIS

During the trial this week, jurors were shown the commercials, as well as one featuring comedian Larry David.

FOX Business’ Eric Revell contributed to this report. 

Source link