Former FTX CEO Sam Bankman-Fried Expresses Concerns Over Binance, Snapchat, and Capital”

In a recent trial, former Alameda Research CEO, Caroline Ellison, revealed pivotal details about the anxieties of Sam Bankman-Fried, the former CEO of FTX, leading up to the collapse of the crypto exchange.

Weeks before FTX faced its downfall, Bankman-Fried was notably stressed about Alameda, investing in Snapchat shares, securing funds from Saudi royalty, and pressuring regulators to take action against rival exchange Binance. This information surfaced from Ellison’s personal notes, presented during her testimony in New York.

Former FTX CEO’s Pre-Collapse Concerns Unveiled in Trial Testimony

The crash in the Terra ecosystem in May 2022 prompted Bankman-Fried to contemplate shutting down Alameda and pursuing a hefty $1 billion in capital from a Saudi Crown Prince known for blockchain gaming investments.

Bankman-Fried’s strategic focus a year prior included pushing regulators to intervene at Binance, aiming to boost FTX’s market share, although specific plans remained undisclosed.

The former CEO was also actively seeking additional funds from crypto lender BlockFi, with concerns ranging from trading Japanese government bonds to investing in Snap Inc stocks and ensuring the satisfaction of an enigmatic figure referred to as “Willie,” likely a nod to Bankman-Fried’s mentor, William MacAskill.

Ellison disclosed that Bankman-Fried held her accountable for Alameda’s issues and ineffective hedging. She acknowledged that a better hedge strategy might have aided Alameda during the crypto winter, but the company’s significant open-term loans and substantial spending from its FTX line of credit complicated matters.

With revelations of “alternative” spreadsheets concealing financial liabilities, Ellison shed light on the pressure to present Alameda favorably to lenders. Emotional distress permeated her trial testimony, expressing concerns about customers withdrawing funds amid a looming “liquidity crush.”

As the trial progresses, Ellison’s cross-examination by Bankman-Fried’s defense is scheduled for October 12.