Former High-Ranking FTX Executive Testifies Against SBF

October 6, 2023 8:41 am Comments

A former high-ranking FTX executive and founding member of the now-defunct exchange testified against Sam Bankman-Fried on Thursday.

According to sources, Gary Wang, former Chief Technology Officer of FTX, testified that he committed crimes with other high-ranking personnel at the company such as Caroline Ellison, Sam Bankman-Fried, and Nishad Singh.

Moreover, he told prosecutors that Alameda was essentially allowed to withdraw anything they wanted from FTX and the pooled assets of FTX customers—there was no limit.

Cointelegraph provided this quote from Wang: “We allowed Alameda to withdraw unlimited funds,” said Wang in response to questioning from Assistant United States Attorney Danielle Sassoon.”

One member of the crypto community had this to say: “Gary Wang singing in court about faster transaction speeds for FTX, unlimited withdraw amounts, & the ability to maintain a negative balance.. We already knew about the anti liquidation feature. SBF, Gary, Caroline and crew had every cheat code yet still lost.”

Decrypt reports:

The way Wang explained it, Alameda had a large line of credit, a way to place orders that got executed faster on FTX’s platform, and could withdraw unlimited funds. It was allowed to carry a negative balance, he said.

Crypto analyst Marty provided a paraphrased transcript of Wang’s questioning at the hands of prosecutors:

Q. Did you commit financial crimes while working at FTX?
A. Yes.
Q. What types of crimes did you commit?
A. Wire fraud, securities fraud, and commodities fraud.
Q. Did you commit these crimes by yourself or with other people?
A. With other people.
Q. Who were the main people you committed these crimes with?
A. Sam Bankman-Fried, Nishad Singh, and Caroline Ellison.
Q. You’re talking about Alameda Research?
A. Yes.
Q. Okay. We’ll come back to it in a minute. When you say withdrew unlimited amounts of funds, whose funds are you talking about?
A. Those of customers.
Q. Let’s talk about——sorry. And customers of what?
A. Customers of FTX.
Q. Mr. Wang, do you see any of the people you committed those crimes with in the courtroom today? You can stand up if you need to.
A. Yes.
Q. Who do you see?
A. Sam Bankman-Fried.
MR. ROOS: Let the record reflect the witness has identified the defendant.
Q. Mr. Wang, in general terms for now, what did you do with the defendant that was the wire fraud you were referring to?
A. We gave special privileges to Alameda Research on FTX, which allowed it to withdraw unlimited amounts of funds from the platform, and we lied about this to the public.
Q. When you say withdrew unlimited funds from the platform, what are you referring to?
A. It had the ability to, regardless of what was in the account, to withdraw unlimited amounts of money.

Serious Crypto News explained: “This is what Gary Wang told the court:  When FTX collapsed, Alameda had withdrawn $8 billion from FTX and $65 billion from its credit lines. Alameda had a large line of credit. Gary Wang revealed that he owns a 17% stake in FTX and SBF owns 65%. SBF owns 90% of Alameda Research and Wang 10%. Wang also revealed that he earns an annual salary of $200,000 with FTX.”

Crypto Potato added:

When pressed further, Wang indicated that these special privileges were baked into the code. He also indicated that – despite his 17% ownership stake in FTX – all disagreements were eventually solved in accordance with SBF’s wishes.

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