About 1,300 pieces of evidence were presented in a Manhattan courtroom during the six weeks that the Sam Bankman-Fried trial lasted. These range from text messages and financial reports to audio recordings of internal meetings at FTX and Alameda Research. These sister companies were, until their demise in November last year respectively, the world’s largest cryptocurrency exchange and one of the most important cryptocurrency trading houses, the pillars of the 31-year-old Bankman Fried empire.

Once the poster boy of the cryptocurrency world, “SBF” is now on the rise. He has advocated for more rules for the sector, but appears to have freely ignored them within his companies. Billions of dollars are missing. Stolen, according to the Public Prosecution. Bankman-Fried allegedly invested money from FTX clients in real estate, political donations, risky investments and in filling wells in Alameda.

Unfortunately, she disappeared due to an accounting error and mismanagement by Alameda CEO Carolyn Ellison, the defense said. Bankman-Fried has pleaded not guilty to seven counts of fraud and money laundering.

Recurring and non-recurring relationship

In the weeks leading up to the trial, SBF had to prepare for his trial from prison. Judge Lewis Kaplan revoked bail because Bankman-Fried tried to influence witnesses. He leaked, among other things, excerpts from Caroline Ellison’s memoirs New York times. In it, Alameda’s then-CEO, who had an on-and-off relationship with Bankman-Fried for years, wrote that she was afraid she would be bad at her job.

Interestingly, Ellison himself is now a key witness in the lawsuit against Bankman-Fried, just like FTX co-founder Gary Wang and FTX director Nishad Singh. The first two have already been witnessed.

The message was the same: “Sam made me do it.” What “it” is is diverse. Wang, who laid the foundation for FTX’s trading platform, said that in 2019 Bankman-Fried asked him to modify the computer code so Alamada could borrow without limits. By the fall of 2022, the trading company had borrowed $14 billion from FTX, an amount it was unable to repay.

Balance deception

He said Wang knew this was a mistake. “This money belonged to the clients, and they did not give us permission to do other things with it.” During his testimony, he avoided any eye contact with Bankman-Fried. The two met as teenagers at a math camp, and later shared a room at MIT.

According to Bankman-Fried’s defense, the special arrangement for Alameda was necessary because of his role Market maker, a broker that ensures that investors always have a counterparty to buy or sell from. That’s why a tweet from July 2019 hurt, in which SBF claimed that Alameda should meet the same conditions at FTX as everyone else.

Ellison said Bankman Fried ordered her to commit fraud and money laundering. Among other things, she prepared seven different versions of Alameda’s balance sheet to mislead counterparties about the true position of the trading house. For example, the amount borrowed from FTX has been deleted.

Reducing the penalty

The defense had Ellison admit that SBF was not involved in the day-to-day management of Alameda, while implying that it therefore could not be held responsible for mistakes committed there. Especially after they finally broke up in the spring of 2022, they didn’t talk much about what was going on at work, Ellison said. “I tried to avoid one-on-one situations.”

According to Bankman-Fried’s defense, Wang and Ellison’s testimonies are unreliable because they have an interest in portraying him in the worst possible light. Both have already pleaded guilty in exchange for a reduced sentence and on the condition that they testify against Bankman-Fried.

Careful interrogation

It is unclear whether Bankman-Fried himself will testify. Typically, defense attorneys advise against such a practice because it also requires the defendant to face cross-examination from prosecutors. But Bloomberg columnist Matt Levin has an important counterargument: His testimony simply couldn’t make matters worse.

“If he doesn’t testify, the jury will only have (1) the testimony of FTX customers saying, ‘All our money is gone,’ (2) the testimony of all his close friends and colleagues saying, ‘Yes, we stole’ ‘All the money because Sam told us with that,” and (3) screenshots of FTX computer codes that say something like “If you feel like it, steal (all.the.money).”

The trial will continue for another four weeks. Bankman-Fried faces more than a hundred years in prison.