Gary Wang details Alameda's trading privileges on FTX in SBF trial

SBF’s trial: On the fourth day of the criminal trial of former CEO Sam "SBF" Bankman-Fried, Gary Wang, co-founder, and former chief technology officer of FTX, testified in a New York courtroom regarding the connections between the crypto exchange FTX and Alameda Research.

Wang revealed that Alameda's account on FTX was the only authorised one to trade more than it had available, utilising a feature called "allow negative." He testified that Bankman-Fried had directed him and Nishad Singh, former FTX engineering director, to implement this feature in 2019.

This addition to FTX's code allowed Alameda to achieve a negative balance exceeding FTX's revenue in 2020—$200 million compared to $150 million. Wang stated that Bankman-Fried granted Alameda a $65-billion line of credit, contradicting public statements about the relationship between the two firms.

Special privileges for Alameda Research

Wang revealed that Bankman-Fried claimed Alameda's "special privileges" on FTX were associated with the exchange's FTX Token (FTT), used for trading when Alameda's account balance was below zero. He testified that Alameda had been able to withdraw funds directly from FTX.

The prosecution alleges that Bankman-Fried used FTX user funds at Alameda without customers' consent. Wang, who had already pleaded guilty to fraud charges in December 2022, admitted to committing crimes with Bankman-Fried and former Alameda CEO Caroline Ellison.

The trial is anticipated to continue through November, with Ellison and Singh likely to be witnesses. Bankman-Fried remains in jail following the revocation of his bail in August, and it's uncertain whether he will testify during the trial.