SBF’s Anxiety: Binance, Snapchat, and Capital Among His Sources of Concern

In the lead-up to the collapse of FTX, the cryptocurrency exchange once led by Sam Bankman-Fried (SBF), a series of revelations have surfaced during former Alameda Research CEO Caroline Ellison’s testimony in New York. According to Ellison, SBF was deeply concerned about various aspects, as noted in her personal records, which were presented as evidence during the trial.

In May 2022, a significant crash in the Terra ecosystem led SBF to contemplate shutting down Alameda. To address this, he explored raising a substantial $1 billion capital injection from a Saudi Prince known for his investments in blockchain gaming, sourced through Saudi Arabia’s sovereign wealth fund. Additionally, SBF was actively involved in diverse ventures, including purchasing shares in Snap Inc (SNAP) and trading bonds issued by the Japanese government.

One of SBF’s paramount concerns was a desire to expand FTX’s market share by pressuring regulators to tighten their grip on rival crypto exchange, Binance. Although the specifics of his plan were not detailed by Ellison, this move highlighted the intense competition within the crypto industry.

Furthermore, SBF sought additional funds from crypto lender BlockFi, which had already extended significant loans to Alameda. These financial dealings were accompanied by challenges related to Alameda’s open-term loans, without a fixed maturity date, which lenders like Genesis Capital began to enforce, necessitating Alameda to repay millions. Under SBF’s direction, Ellison utilized FTX customer funds to partially settle Alameda’s debts, further complicating the financial landscape.

Ellison also disclosed moments of emotional strain, particularly concerning the potential withdrawal of funds from FTX during a period of intense financial pressure. Every day, she lived in fear of the simultaneous call for loan repayments, leading to a constant state of anxiety.

Notably, Ellison admitted to creating misleading financial documents at SBF’s request, designed to present a more favorable picture to Alameda’s lenders, thus concealing the true extent of their liabilities with FTX.

As Ellison’s testimony unfolded, it painted a picture of intense pressure, financial maneuvering, and ethical dilemmas, shedding light on the complex world of cryptocurrency trading and the consequences of high-stakes decisions. Her upcoming cross-examination on October 12th promises to reveal even more insights into this intricate web of financial activities and interpersonal dynamics.

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