Is Sam Bankman-Fried a nasty ‘guy’ or a nice ‘boy’? Attorneys switch opening statements sooner than first witnesses take the stand






That solution in the long run lies with the jury, which was once decided on on Wednesday morning sooner than attorneys for the federal government after which Bankman-Fried swapped two very other tales of the previous crypto multi-millionaire’s surprising upward push and nearly immediate fall.

Right here’s what took place on the second one day of the trial, which featured pointed allegations, a chum from MIT, and an target market replete with giant names, together with Bankman-Fried’s professorial folks and Damian Williams, the U.S. Lawyer for the Southern District.

A aware legal…

The prosecution’s account of the alleged crimes by way of Bankman-Fried, who spent maximum of his day in courtroom staring right into a pc whilst seated between his two lawyers, featured a learn about in contrasts.

“12 months in the past, it gave the look of the defendant was once at the best of the arena,” started Thane Rehn, a prosecutor for the federal government, in his opening commentary. The previous CEO of FTX oversaw a supposedly thriving crypto change, jetted between global locales, and hobnobbed with celebrities like Tom Brady and Larry David. He again and again emphasised to shoppers that their cash was once protected and safe.

However “all of that, it all, was once constructed on lies,” Rehn declared to the jury. “In the back of the curtains, he was once no longer what he looked to be.” What adopted was once a kind of 30-minute tale that again and again emphasised how Bankman-Fried allegedly stole buyer budget to facilitate his jet-setting way of life, donate tens of millions to political applicants, and finance dangerous bets.

The important thing to his alleged scheme? Alameda Analysis, a crypto hedge fund he additionally owned, argued Rehn. The use of Caroline Ellison, his on-again off-again female friend and the CEO of Alameda, as a entrance, Bankman-Fried had “secret get entry to” to buyer cash—each money and crypto—the federal government claimed.

Additionally, Bankman-Fried allegedly directed workers to hide the glide of cash into FTX’s coffers and cast monetary paperwork disbursed to lenders and buyers. “The defendant lied to the arena,” Rehn alleged.

And who was once this defendant? No longer a crypto “boy” genius, as such a lot of in media (Fortune incorporated) have written, however a “guy who “stole billions of greenbacks from 1000’s of sufferers,” Rehn mentioned. “You are going to see the total image.”

…or a well-meaning founder?

However Bankman-Fried, whose cheekbones had been extra outstanding after spending about seven weeks in a Brooklyn jail, was once no liar, consistent with Mark Cohen, one in every of his attorneys. “Sam didn’t defraud any individual,” he mentioned early on in his opening commentary.

What the jury will see is a nerdy startup founder who acted in “nice religion,” no longer the prosecution’s “cool animated film of a villain.” (Cohen again and again harped on Bankman-Fried’s allegedly good-faith movements right through his cope with to the jury.)

Alameda was once no longer subterranean or shady. It was once a a hit hedge fund, he mentioned. FTX was once no Ponzi scheme. It was once a “very leading edge, a hit corporate.” And the trade practices between the 2 had been affordable, he argued, claiming that Alameda acted legally as an FTX buyer, fee processor, and marketplace maker, or monetary entity that acts as a buying and selling spouse for patrons taking a look to shop for and promote cryptocurrencies.

In an analogy he hired right through his opening commentary, he mentioned that “operating at a startup is like construction a airplane as you’re flying it” and that companies now and again fail. Actually, he in particular pointed the finger at Ellison, the previous CEO of Alameda, who, he mentioned, didn’t adequately give protection to her hedge fund from the inherent chance of the crypto markets.

When the partitions got here last in and the aforementioned airplane approached the “eye of the hurricane,” Bankman-Fried didn’t act like any individual who was once accountable. Moderately, he was once keen to surrender his private wealth to make shoppers complete, Cohen argued.

“In any case, Sam began and constructed two billion-dollar companies,” he concluded. “He didn’t scouse borrow any cash.”

A Frenchman who lives in London who testifies in New York

After attorneys from all sides depicted two very other Bankman-Frieds, the prosecution known as its first two witnesses to the stand—they usually weren’t blockbuster names or former lieutenants-turned-government-cooperators, like Ellison.

The primary was once a sufferer: Marc-Antoine Julliard, a Paris-born cocoa dealer who lives in London. In 2021, Julliard, who had coiffed hair and spoke with a robust French accessory, made up our minds to spend money on crypto and landed on FTX as his change of selection, the place he traded cryptocurrencies like Bitcoin and Dogecoin.

On Nov. 8, within the crypto change’s ultimate few days, he attempted to drag out his money and crypto. How a lot? Virtually $100,000, he mentioned. And was once he ever ready to? “By no means,” he informed prosecutors.

In a while later on, because the trial neared the past due afternoon, the federal government known as Adam Yedidia to the stand. A quick-talking graduate of MIT, he and Bankman-Fried had been shut buddies in faculty, he mentioned. And after Bankman-Fried left Jane Boulevard, the high-frequency buying and selling company the place the previous billionaire were given his get started in finance after MIT, he persuaded Yedidia to enroll in him as a dealer at Alameda after which as a developer at FTX.

When Yedidia first took the stand, Danielle Sassoon, some of the lead prosecutors, mentioned that the school buddy of Bankman-Fried had felony immunity right through his testimony. Why did he make this sort of maintain the federal government, she requested.

“I used to be involved that I had unwittingly written code that contributed to against the law,” he mentioned.

Quickly, alternatively, the clock neared 4:30 p.m., and courtroom adjourned for the day. Yedidia will proceed his testimony on Thursday, adopted by way of Matt Huang, a former spouse on the high-powered mission capital company Sequoia Capital, after which Gary Wang, a key Bankman-Fried lieutenant and some of the authorities’s famous person witnesses.

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