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The founder of a bankrupt cryptocurrency exchange admitted in court that “many people suffered”

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FTX cryptocurrency exchange founder Sam Bankman-Fried, testifying in his own defense at his fraud trial on Friday, said “a lot of people were hurt” after the exchange collapsed last year, but insisted he didn’t defraud anyone or steal billions of dollars from customers.

During the first day of in-person testimony, Bankman-Fried answered questions from his lawyer. In response, he admitted to making “mistakes,” such as failing to establish a risk management team, while also trying to shift blame to Caroline Ellison, the former CEO of his hedge fund Alameda Research, who was a key prosecution witness.

The 31-year-old former billionaire’s responses were consistent with his long-standing position that as an entrepreneur building a rapidly growing company from scratch, he overlooked some aspects of his business, but he never had any intention of stealing from people.

He faces decades in prison

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“We thought we would be able to build the best product on the market,” Bankman-Fried said during six hours of testimony in federal court in Manhattan. – It ended quite the opposite. Many people suffered – customers, employees – and the company went bankrupt, he stated in court.

Bankman-Fried pleaded not guilty to two counts of fraud and five counts of conspiracy. If convicted, he faces dozens of years in prison.

Prosecutors accused Bankman-Fried of using FTX client funds to support Alameda, making speculative venture investments and donating more than $100 million to political campaigns in USA. He is also accused of conspiring to defraud Alameda lenders and FTX investors.

Responding in a calm tone to questions from defense attorney Mark Cohen, Bankman-Fried said he believed the funds used for sponsorships and real estate did not come from FTX clients, as prosecutors allege, but from the company’s revenues or capital received from equity investors. He said he borrowed from Alameda, which he owned, to make political donations.

Bankman-Fried sought to distance himself from the specific actions his three closest associates took. They each pleaded guilty to fraud and testified against Bankman-Fried at trial. He, in turn, claimed that they acted without his direct involvement.

While his former colleagues testified that their boss ordered them to take specific actions that contributed to them stealing customer funds and lying to investors and lenders, Bankman-Fried portrayed himself as a reserved CEO who trusted his subordinates.

Main photo source: Shutterstocklev radin / Shutterstock.com

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