Wang, 30, is one of three FTX insiders who have pleaded guilty
to fraud charges and entered a cooperation agreement with the
government. He and Bankman-Fried were college roommates before
going on to co-found the hedge fund Alameda Research.
Wang testified on Thursday that while at FTX, he created
software code at the direction of Bankman-Fried that gave
"special privileges" to Alameda, allowing it to withdraw
unlimited funds.
Prosecutors have said those privileges were one of the main
mechanisms that Bankman-Fried used to plunder customer assets,
leading to the exchange's collapse in November 2022.
Bankman-Fried's attorney said during opening statements on
Tuesday that FTX was a startup, and that Alameda was not just an
ordinary customer on the exchange but a market maker, which
generated supply and demand in the exchange's early days.
While Wang is the first cooperator to take the stand, jurors
have so far heard from three other witnesses. A former FTX user
testified he was unable to withdraw his funds after the exchange
collapsed, and Matt Huang, the head of a crypto-focused fund
that invested in FTX, said he was told Alameda received "no
preferential treatment" on the platform.
Adam Yedidia, a former FTX computer programmer who reported to
Wang, testified that he expressed concern to Bankman-Fried in
mid-2022 after learning that Alameda had borrowed $8 billion
from the exchange. He said Bankman-Fried appeared worried and
told him the companies were "not bulletproof" as they had been
the year before.
Zac Prince, the founder of crypto lender BlockFi, is among the
witnesses expected to testify after Wang finishes when the trial
resumes next Tuesday.
(Reporting by Jody Godoy; Editing by David Gregorio)
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