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  • Writer's pictureJamal Saafir

Sam Bankman-Fried Was Exercising “Risk Management”

According to a report from Cointelegraph, Sam “SBF” Bankman-Fried, the founder of bankrupt crypto exchange FTX, said that spending clients’ fiat deposits was just part of “risk management” for his affiliated crypto hedge fund Alameda Research.

During SBF’s court testimony on October 31st, prosecutor Danielle Sassoon of the Southern District of New York inquired if SBF believed that it was within his right to spend $8 billion of FTX customers’ money. “I thought it was folded into risk management,” he said. “As CEO of Alameda, I was concerned with their portfolio. At FTX, I was paying attention but not as much as I should have been.“

Danielle Sassoon of the Southern District of New York

As told by SBF, during his tenure as both CEO of FTX and Alameda, no one was terminated for allegedly siphoning $8 billion worth of clients’ money for risky trading. “I don’t remember knowing anything about particular employees,” replied SBF to a question by Sassoon.

During the proceedings, Sam Bankman-Fried also shared that the now-collapsed exchange, which was headquartered in the Bahamas, had close affiliation with the island country’s government. “You gave the Bahamas prime minister floor side seats at the Miami Heat Arena,” asked Sassoon. “I don’t remember that,” replied Bankman-Fried. "Here’s a message where you say he is in FTX’s courtside seats with his wife,” said Sassoon.

Bahamian Prime Minister, Philip Davis

Allegedly, SBF spoke with the Bahamian Prime Minister, Philip Davis, about funding the resolution of his nation’s debt. Although SBF denies it, he admitted to assisting Davis’ son procure employment.

Prior to the exchange’s collapse last November, FTX announced that Bahamian users would be indemnified and that it would process their withdrawal requests in priority. The FTX trial is ongoing and is anticipated to conclude by the end of next week.

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