At a glance
- Jury selection wrapped up yesterday after a slow start on Tuesday.
- FTX customer Marc-Antoine Julliard testified against Sam Bankman-Fried, followed by former friend and FTX developer Adam Yedidia.
- Yedidia said that he resigned right before FTX collapsed, once he learned that Alameda had used FTX customer funds to pay back loans.
Sam Bankman-Fried’s criminal trial finally heated up at the end of its second day, when a former FTX software developer and very close friend took the stand as a witness for the prosecution.
Adam Yedidia testified that he had a long relationship with Sam Bankman-Fried. After being roommates at MIT, Yedidia worked briefly at Alameda Research in 2017, before joining FTX as a developer in January 2021. Yedida testified that from October 2021 until November 2022, he lived in the notorious $35 million Bahamian penthouse apartment with Bankman-Fried and seven other members of his inner circle.
But Yedidia also testified that he hasn’t seen or spoken to his former friend since November 2022. That was when, he said, he came to understand that FTX had used customer deposits to repay outstanding loans. He stated that he resigned from the company very soon after this.
Bankman-Fried’s former friend says he may have contributed to crime
Yedidia is the first of several former close Bankman-Fried associates expected to take the stand. But he’s crucially different from the likes of Nishad Singh and Caroline Ellison: Yedidia hasn’t been charged with a crime, and didn’t testify as a condition of a plea deal.
Instead, he testified under an immunity grant from the government, meaning he can’t be charged with a crime based on his testimony. The former FTX developer said this immunity grant was necessary because he was worried that in his role, he might unwittingly “have contributed to code used in the commission of a crime.”
In addition to his belief that customer funds had been misused, Yedidia said he knew that some US institutional investors were authorized to trade on FTX.com through their offshore arms. This was likely meant to reinforce the US court’s jurisdiction in the case.
Yedidia’s testimony followed the first witness in the trial, a customer named Marc Antoine Julliard, who described his experience of using FTX, and the influence of various advertisements over his decision to use the platform.
A notable moment came in that testimony when defense lawyer Mark Cohen asked Julliard if he understood that cryptocurrencies were volatile and risky. Julliard answered “yes.”
On redirect, though, prosecutors asked the witness to clarify why he understood crypto to be risky. Julliard clarified that he understood the risk of crypto prices fluctuating — but that he had never considered it a risk that FTX itself would take his money.
Prior to these early witnesses, the court spent the first half of the day completing the process of jury selection. Among them are a pediatric nurse and a MetroNorth train conductor.