FTX CEO Denied Charges but Admitted Damages of Collapse

Sam Bankman-Fried (SBF) took the stand on Friday, offering candid insights into the collapse of the cryptocurrency exchange FTX, the platform he co-founded. Facing allegations of investor deception and embezzlement of customer funds, the 31-year-old entrepreneur acknowledged the extensive damage caused by the exchange's downfall, expressing, “A lot of people got hurt, customers, employees, and the company ended up in bankruptcy,” during his testimony in a Manhattan federal court, as reported by the BBC.

In his testimony, SBF openly admitted to a series of errors, ranging from minor missteps to more substantial oversights, in his management of the now-defunct exchange. One of the most glaring omissions, he acknowledged, was the absence of a dedicated risk management team.

Despite the grave accusations looming over him, SBF remained steadfast in his assertion of innocence, maintaining that he never engaged in defrauding individuals or diverting customer funds for personal gain.

SBF began his testimony on Thursday, with the jury adjourning for the day. US District Judge Lewis Kaplan sought a preview of his statements concerning the role of legal counsel in pivotal decisions to determine whether they could be admitted as evidence.

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SBF consistently upheld that his actions were guided by legal counsel, a stance disputed by prosecutors who accuse him of misappropriating customer funds for personal benefit. Judge Kaplan, however, decided against permitting testimony regarding the lawyers' involvement in various loans extended to SBF and other related matters, deeming it potentially confusing.

During his testimony, SBF expressed uncertainty regarding the flow of funds from FTX's customers to Alameda Research and dismissed allegations of directing political donations. He conceded that his awareness of the extent of Alameda's debt to FTX only crystallized in October 2022.