The ongoing criminal trial against Sam Bankman-Fried, former CEO of the FTX exchange, has uncovered some surprising allegations. In court, an internal document was shown indicating that Bankman-Fried believed that Binance leaked the financial balance sheet of Alameda, a cryptocurrency company with which FTX had connections, to the media in 2022.
These revelations have shaken the crypto world and triggered deeper scrutiny of relationships and business ethics in this rapidly growing sector.
The document presented in court, dating from November 6, 2022, has become a key piece in the trial.
In it, Bankman-Fried outlined a series of actions that suggested Binance was involved in a public relations campaign against Alameda and FTX, we reviewed an excerpt from Inner City journalist covering the trial.
Ellison: The tweet characterizes the delay as being about anti-spam and nodes. But we just didn't have the money.
AUSA: Are these the tweets of CZ of Binance?
Ellison: Yes. He tweeted, "we have decided to liquidate any FTT on our books." I was stressed out.
— Inner City Press (@innercitypress) October 11, 2023
Apparently SBF accused Binance of leaking a financial statement of Alameda, disseminating it on a blog and providing it to the CoinDesk platform.
Binance publicly announced that they were selling 500 million FTX Token (FTT) in response to this leak, while advising customers to be careful with FTX. This series of events contributed significantly to the collapse of FTX and its subsequent bankruptcy.
Liquidating our FTT is just post-exit risk management, learning from LUNA. We gave support before, but we won't pretend to make love after divorce. We are not against anyone. But we won't support people who lobby against other industry players behind their backs. Onwards.
— CZ 🔶 Binance (@cz_binance) November 6, 2022
The Lack of Liquidity at FTX Also Became a Point of Discussion
Caroline Ellison, former CEO of Alameda Research, testified that despite reports claiming that FTX had assets worth $12 billion, only $4 billion were available to process withdrawals.
This revelation raises questions about financial transparency and asset management in the world of exchanges.
The document presented at the trial also shed light on potential investors, among whom Justin Sun, founder of the Tron network and advisor to Huobi, was mentioned.
However, it was highlighted that Sun had a close relationship with Changpeng Zhao (CZ), the CEO of Binance, which raises questions about possible conflicts of interest in the world of cryptocurrencies.
The impact of these accusations and revelations on the trial is profound. Sam Bankman-Fried faces seven counts of conspiracy and fraud related to the collapse of FTX, to which he has pleaded not guilty.
In addition, a second trial is scheduled for March 2024, in which he will face six other charges, including bank fraud and foreign bribery conspiracy.