SBF urged FTX staff to use Signal app and set message ‘auto delete’ feature, day 3 revelations as Yedidia says

  • Day 3 of the SBF/FTX trial revealed that Bankman-Fried urged employees to use Signal app and set auto-delete feature.
  • From the beginning, SBF acknowledged that keeping messages “was all downside.”
  • Adam Yedidia was today’s witness, having served directly under Nishad Singh and featuring among SBF’s roommates.
  • Next one on stand will be Paradigm co-founder and former Sequoia partner Matt Huang.

Sam Bankman-Fried (SBF) attended court for day three of the trial, after yesterday’s opening statements, well-shaven and formally dressed, as reported. This time, however,  his mother Barbara Fried is in attendance, Blockworks reports. He is being tried for seven different counts of federal law violations in a Manhattan courthouse.

Also Read: Sam Bankman-Fried trial’s opening statements, important points as court hearing begins

SBF was against keeping messages, Yedidia

SBF urged employees to use the Signal app and set the messages auto-delete feature, according to testimony by today’s witness, Adam Yedidia, adding that Sam Bankman-Fried believed keeping messages “was all downside.”

Yedidia reported directly to former Engineering director Nishad Singh while living in the same house as Sam Bankman-Fried himself. He also attended college with the accused.

The revelations came as the prosecution took shots at Yedidia, canvassing for information about his professional tenure at FTX and associated relationship with the defendant.

Reportedly, SBF had also sought advice from Yedidia about his intentions to date Alameda Research’s Caroline Ellison, acknowledging having had prior relations with her. According to the testimony, Yedidia did not support the proposal, possibly because of the traditional HR code, “relationships between colleagues are not allowed.” Obviously, SBF did not heed.

Despite his many weaknesses, SBF stood out for his openness to risk, according to Yedidia, highlighting his willingness to test limits no one else would dare.

Notably, Yedidia gets immunity and therefore absolution for his involvement, direct and indirect.

SBF allowed Alameda unlimited withdrawals despite negative balances, Gary Wang 

FTX co-founder Gary Wang also attended the court session later that afternoon, testifying that SBF allowed Alameda to execute orders faster on the FTX platform:

We allowed Alameda to withdraw unlimited funds

Wang also added that SBF allowed the hedge fund to execute unlimited withdrawals of funds despite maintaining negative balances.

By the time FTX was imploding, Alameda had withdrawn $8 billion from the exchange and an additional $65 billion from its credit lines.

Another revelation from Wang was that he holds a 17% stake in FTX and 10% in Alameda, while SBF owns 65% and 90%, respectively.

Going forward…

For the second part of the session, Paradigm co-founder and former Sequoia partner Matt Huang will be expected to take the stand.

Cryptocurrency metrics FAQs

What is circulating supply?

The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.

What is market capitalization?

Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.

What is trading volume?

Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.

What is funding rate?

Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.

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