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The trial, which has been going on for six weeks, continues today. FTX CEO had previously claimed that one of his competitors had targeted the exchange. Although it seemed like a delusion, the truth was revealed today with Caroline’s confession.
FTX Trial on October 11th
Ellison came back to the courtroom today to give his testimony. The judge asked him about Alameda’s trading positions. He explained that they suffered losses due to the decline in cryptocurrency prices. The decline in the crypto markets had a negative impact on Alameda’s loans. The company faced difficulties as lenders demanded their dues.
The confession that the balance of FTX customers was used to repay the $400 million loan from Genesis was one of the most important topics of the day. Although SBF’s lawyer tried to intervene, the judge did not accept it.
“I was concerned about customers withdrawing from FTX, about this coming to light, and people getting hurt. I used to update Alameda’s balances whenever they asked for it. He was my boss, the owner of Alameda. He directed me to repay the loans. We did this with the money of FTX customers. Customers had deposited $13 billion, but there was only $3 billion available at FTX. We couldn’t find a new source of capital. I continued to worry about FTX customers finding out about this and trying to withdraw all at once.”
Binance and Bitcoin Conspiracy
While the trial was ongoing, Ellison explained how they created fake balances to request loans from Genesis. The confessions about Binance were the most crucial point. CZ had previously stated that one of their competitors had conspired against them. FTX argued that Binance targeted FTT with CZ’s statements. Some US politicians even supported this.
However, Ellison said today:
“SBF wanted to provoke regulators against Binance exchange.”
He also mentioned that this was on Sam’s to-do list. SBF, who had strong connections with regulators and politicians, owed this to their influential parents. Another crucial point was the confession that they used customer funds to keep the price of Bitcoin below $20,000. Customers were losing their money completely. The balance they thought was in the exchange was actually being eroded by the decline in BTC, using their own funds.
