- FTX founder Sam Bankman-Fried’s trial brings major cryptocurrencies into the spotlight, conspicuously omitting FTT.
- Federal prosecutors emphasize Bankman-Fried’s alleged misuse of billions while defense stresses “good faith”.
Major Cryptocurrencies Take Center Stage, FTT Remains in Shadows
On the inaugural day of the much-anticipated criminal trial of FTX’s founder, Sam Bankman-Fried, Bitcoin, Ethereum, Dogecoin, and Solana were the cryptocurrencies mentioned. Intriguingly, FTT, the native token of FTX and widely seen as integral to the exchange’s dramatic fall, was notably absent.
FTX’s startling demise is closely linked with the significant plunge in the value of the FTT token last November. Yet, as the trial commenced in a New York district court, federal prosecutors seemed keen on gently introducing the jury to the complex world of digital currencies, leaving out direct references to FTT.
Assistant U.S. Attorney Thane Rehn conveyed the gravity of the situation to the jury, emphasizing Bankman-Fried’s alleged misdeeds,
“This man stole billions from countless individuals. He extravagantly used others’ funds for personal gain.”
FTX’s journey to bankruptcy began when the steep decline in the FTT token value led to a catastrophic wave of withdrawals. FTX’s failure to refund its clients ultimately exposed their lack of 1:1 asset reserves.
Renowned crypto platform, CoinDesk, revealed substantial FTT holdings by Bankman-Fried’s trading firm, Alameda Research. Furthermore, Binance’s CEO, Changpeng Zhao, indicated plans to offload their FTT holdings entirely, shortly before FTX’s crisis escalated.
Facing multiple charges, including fraud and conspiracy, Bankman-Fried has proclaimed his innocence. Mark Cohen, Bankman-Fried’s chief attorney, depicted FTX’s downfall as an unfortunate confluence of factors, emphasizing his client’s
“sound business strategies.”
Cohen hinted at the controversial FTT while discussing the fund transfers between FTX and Alameda. Contrary to prosecution’s claims of secrecy, Cohen argued,
“Sam was under the genuine impression that FTX’s loans to Alameda were authorized and had substantial backing. Far from being clandestine, these transactions were transparent within both organizations.”
Witnesses Cast Light on Cryptocurrencies, Overlook FTT
While FTT took a backseat, other cryptocurrencies gained attention during witness testimonies. The prosecution’s first witness, commodities trader Marc-Antoine Julliard, oriented the jury to the cryptocurrency landscape. Recounting his personal experience, he mentioned his usage of major coins like Bitcoin and Ethereum and even depositing Dogecoin into FTX.
Adam Yedidia, the prosecution’s second witness and an ex-employee of both Alameda and FTX, elucidated on popular digital currencies. Having known Bankman-Fried since college, Yedidia’s testimony took a twist as he shared his resignation reasons, revealing concerns about Alameda Research utilizing FTX customer funds to settle its debts.