Sam Bankman-Fried’s Former Friends Share Startling Testimonies

The trial has brought to the stand the co-founder of the investment firm Paradigm, along with two of SBF's previous friends, Gary Wang and Adam Yedidia. During their testimonies, both Gary and Adam boldly divulged some of the deepest secrets associated with Sam Bankman-Fried.

Gary Wang, a little-known co-founder and former CTO of FTX, first crossed paths with Bankman-Fried during a summer camp in their high school years. They later became roommates at the Massachusetts Institute of Technology (MIT). 

Wang has since admitted to fraud, and in doing so, struck a deal with the prosecutors. This agreement obliges him to respond truthfully to all inquiries and submit any pertinent evidence. He's currently facing a potential sentence of up to 50 years in prison. 

During his testimony, Wang shared that Alameda Research was granted access to FTX's funds, facilitated by a unique software code developed by FTX Director of Engineering, Nishad Singh. Moreover, Alameda Research maintained a credit line worth $65 billion. 

A significant portion of Wang's testimony delved into the final days before FTX's notorious collapse. Contrary to Bankman-Fried's public assurances on X (Twitter) that everything was fine, the behind-the-scenes reality was far from it. At that time, FTX faced a critical liquidity shortfall, largely because Alameda Research was draining even the funds belonging to the exchange's clients.

Adam Yedidia was a close friend and classmate of Bankman-Fried at the Massachusetts Institute of Technology (MIT). Before joining FTX as a software developer, he briefly worked as a trader at Alameda Research.

Yedidia told about a Signal group chat called 'People of the House', referring to Bankman-Fried’s $35 million penthouse, which housed many employees, including Yedidia himself. During those talks, Bankman-Fried hinted that Alameda would eventually cover the rent. 

Furthermore, Yedidia disclosed that Sam Bankman-Fried had shared with him about past intimate relations with Caroline Ellison, the former CEO of Alameda Research.

Yet, the most alarming detail from Yedidia's testimony was the unaccounted $8 billion of client funds in an internal database, which tracked money moved to Alameda's accounts. Despite this glaring issue, he maintained his trust in Sam.

Matt Huang, a co-founder of the venture capital firm Paradigm, poured over $275 million in FTX. He voiced concerns over the lack of a board of directors at FTX but decided to invest owing to his trust in Bankman-Fried.

Bankman-Fried reassured Huang that the funds would be used for the betterment of FTX and not diverted to Alameda. He also conveyed his intent to establish an expert-filled board. Regrettably, Paradigm's investment in FTX diminished to nothing.