It was Sam Bankman- Fried’s bean bag chair that was a lie
Observation of the Second Witness, Marc-Antoine Juilliard, in a Commodity Trading Exchange: Adam Yevidia’s Testimony
The second was Bankman-Fried’s college roomate and longtime friend Adam Yevidia. He is a cooperating witness, who was offered immunity. He worked for Alameda for two months when he was finishing a Ph.D., then was hired back by SBF as a software developer.
Among the first witnesses called on to testify was a commodities trader from London, Marc-Antoine Juilliard. He said that he was unable to withdraw all of his money when the exchange fell apart.
In an attempt to preempt that argument, Rehn urged jurors to “scrutinize their testimony carefully.” He told them they would offer first-hand insights into the fraud the government alleges was committed with their help.
Cohen encouraged jurors to be skeptical of their testimony, noting they had pleaded guilty and are likely to receive a lighter sentence as a result of their cooperation.
Bankman-Fried explains his FTX empire and the rise and fall of his empire to a plane as you’re flying it
We got some other details on Bankman-Fried’s personal life “Sometime in early 2019, the defendant told me that he and Caroline [Ellison] had had sex and asked if it was a good idea for them to date,” Yedidia said. He told Bankman- Fried it was not a good idea. At the time, she was just a trader at Alameda Research and Bankman-Fried’s subordinate. She would become the co-CEO later.
Cohen criticized the government for displaying a photograph to the jury of Bankman-Fried in what was his trademark look before he was sent to jail in August: shorts and a t-shirt, with unkempt hair.
Mark Cohen pushed back against the narrative which suggested Bankman-Fried was a villain. He said FTX in its infancy was growing at an unimaginable pace, “like building a plane as you’re flying it.”
Bankman-Fried, who has been jailed for more than a month, appeared to pay close attention. He’s allowed to take notes on his laptop during the trial.
Rehn detailed how Bankman-Fried took money from FTX customers “to make himself even richer.” He made speculative investments after buying properties for family, friends, and himself.
Bankman-Fried lived in a $30 million apartment in the Bahamas and traveled the world on private planes. Rehn noted Bankman-Fried hung out with actors, athletes, and politicians.
Rehn illustrated the rise and fall of Bankman- Fried’s empire, which included the currency exchange FTX and a hedge fund.
“He had wealth. He had power. He was an assistant U.S. attorney in New York. “But all of that was built on lies.”
Sam Bankman-Fried’s Love Life and Bean Bag Chair a lie too? A case for immunity in his first witness, Marc-Antoine Julliard, in a digital currency exchange trial
The trial of Sam Bankman- Fried kicked off on Wednesday with both sides giving opening statements.
The government is making a fast case for one count of the indictment against Bankman-Fried as two of his college roommates testify against him. We also heard about Bankman-Fried’s love life and bean bag chair.
Yesterday, the prosecution called as its first witness a customer, Marc-Antoine Julliard, who works as a commodities trader. I don’t know if it was smart of him to invest in the digital currency. The important part of his testimony? As the result of Bankman-Fried’s tweets — “FTX is fine. Assets are fine.” — he did not withdraw his money from the exchange as it went belly-up.
The next witness, Bankman-Fried’s former college roommate Adam Yedidia, said Bankman- Fried knew the enterprise was in trouble as early as June or July. They had the conversation on a padel tennis court in their luxury Bahamas complex, the Albany.
Yedidia was testifying with immunity, because he was worried that as a developer, he might have unwittingly written code that contributed to a crime. He was a deliberate speaker who took a beat after the questions to think and then floated his head close to the microphone to answer.
Yedidia worked for Bankman-Fried twice: first as a trader at Alameda Research for two months in 2017 before returning to a PhD program, then from 2021 onward for FTX as a software developer, where he lived — along with Bankman-Fried — in the Orchid, a $35 million penthouse apartment in the Albany. The jury saw photographs of the luxury apartment, which had a cream and gray interior and a gorgeous balcony with a pool.
We also saw a screenshot of a Signal groupchat called “People of the House,” where Bankman-Fried said, “Heh, I’ve been mentally assuming that aggregate rent collected would be zero dollars” and that he had “been assuming that it’s basically just Alameda paying for it in the end.”
Source: Was Sam Bankman-Fried’s bean bag chair a lie too?
Why did he quit FTX? The case against Bankman-Fried for lying about his bankrupt relationship with Alameda Research
Yedidia testified that he quit FTX after getting a phone call telling him that Alameda had used FTX customer funds to repay its loans. He resigned in November 2022, just before FTX went bankrupt.
We lied about this to the public because we gave special privileges to Alameda Research which allowed it to withdraw unlimited amounts of funds from the platform.
Yedidia knew all this because he worked on a process to automate the processing of customer deposits and withdrawals around July 2021. He introduced a bug in the code that made it look bigger than it was. The bug was discovered in December 2021, and had exaggerated the liabilities by $500 million. Yedidia fixed it in June 2022; by then, it was exaggerating Alameda’s liabilities by $8 billion.
Yedidia said he asked if things were okay, and Bankman-Fried replied, “We were bulletproof last year, but we’re not bulletproof anymore.” He said Bankman- Fried was worried while he said it, but he trusted Sam. Besides, he was just a dev — his job was to make sure the code ran well. People could handle the money.
At one point, prosecutor Danielle Sasson asked if Bankman-Fried really slept in a bean bag chair. Yedidia said that in the Bahamas, that didn’t happen as often as it had in Hong Kong: “I think he would take occasional naps, but not with much frequency.”
The cross-examination was rough for the jury, observers, and the judge who reprimanded the defense counsel for repeating questions the government had just asked. During the meandering cross-examination, Everdell first established that Yedidia didn’t deal with customer money, interact with investors, or otherwise have much contact with FTX’s finances. He tried to coax Yedidia into saying Bankman-Fried didn’t spend much money on himself, and to suggest Yedidia’s immunity agreement may have compromised his testimony.
FTX was attractive as an investment because it was growing really fast, Huang said. FTX was shown a slide that said they were a custodian. He explained that FTX processed withdrawals after holding customer deposits. He said if he had known FTX was using customer deposits for its own purposes, he wouldn’t have invested. In crypto, he explained, there was a general expectation that customer deposits weren’t spent.
In an email to Bankman-Fried, Huang noted some concerns Paradigm had. The firm was concerned about governance and relationship between FTX and Alameda. Customers would not want to trade in Alameda if there was special access to FTX. After that email, Huang was told there was no preferential treatment for Alameda.
The balance sheet showed that Bankman- Fried made a $322 million net profit in the fourth quarter of 2016 and that the company had made a profit of over 80 million dollars for the year. The balance sheet showed a set of trading expenses in the quarter of over $60 million, which Huang said was the true amount of FTX trading expenses. He testified that the profits would look artificially high if not all of the expenses were recorded, and that he expected the numbers being shown to him to be generally accurate.
He testified that he had pressed Bankman-Fried to create a board for FTX, but he knew there was no one. “He told us that he didn’t think investors had that much to add, but he did represent that he would be creating a board at some point,” Huang said.
Wang hasn’t finished his direct testimony and hasn’t sat for cross-examination yet. The prosecution seems to have prepared for the possibility that he could undermine his own credibility. When Wang testified that Alameda Research had been so named because it obscured that the firm dealt with crypto, making it easier to get a bank account, that testimony was followed by video of Bankman-Fried saying substantially the same thing on a Blockworks podcast. When Wang testified about his ownership stake, we saw documents signed by Bankman-Fried that backed up what he said.
Adam Yedidia, former roommate of cryptocurrency exchange FTX’s CEO Sam Bankman-Fried, has testified at his trial that Bankman-Fried asked him in early 2019 if it was a “good idea” for them to date. Yedidia said Bankman-Fried told him that he and CarolineEllison had had sex. Yedidia added Bankman-Fried knew FTX was in trouble as early as June or July last year.