FTX co-founder and a group of colleagues has been going though a criminal trial for the recent downfall of the cryptocurrency exchange FTX. For those who do not know, FTX was once of the biggest players in the cryptocurrency market, leading Sam Bankman-Fried to become of the richest people in the planet.
According to recent court testimonies by some of the co-founders and people involved closely with the company’s operations exposed the bad practices that the company had been acquiring over time and the extent that Mr. Bankman-Fried was willing to go.
When FTX users started to realized that they were having difficulties withdrawing their money a bank run type of reaction happened were too many users decided to withdraw money at once, creating the official debacle of the crypto exchange.
Ellison (Bankman-Fried ex-girlfriend and CEO of Alameda Research, a sister company from FTX that had borrowed money from the company) revealed that she had to doctor balance sheets to try to hide that Alameda was borrowing about $10 billion from FTX customers in June 2022, when the cryptocurrency market was falling dramatically and some lenders were demanding that Alameda return their investments in full.
We still have yet to see the final court ruling against Mr.Bank-Fried and his co-conspirators.
Author: Amaury Abreu
