Caroline Ellison, the former CEO of Alameda Research, has testified that Sam Bankman-Fried (SBF), the co-founder of FTX, considered raising money from the Saudi crown prince to repay FTX customers.
Ellison’s testimony came during a hearing in the bankruptcy case of FTX and Alameda. She said that SBF discussed the possibility of raising money from the Saudi crown prince in the fall of 2022, when FTX was facing a liquidity crisis.
Ellison said that SBF ultimately decided not to raise money from the Saudi crown prince, but that he did not explain his reasons for doing so. She also said that she was not aware of any specific steps that SBF took to pursue the possibility of raising money from the Saudi crown prince.
The possibility of SBF raising money from the Saudi crown prince to repay FTX customers is significant because it raises questions about his motives. The Saudi crown prince has been accused of human rights abuses, and raising money from him would have been seen as a controversial move.
It is also unclear why SBF would have considered raising money from the Saudi crown prince in the first place. FTX was one of the largest cryptocurrency exchanges in the world, and it had access to a wide range of other sources of capital.
Ellison’s testimony is just one piece of the puzzle in the ongoing investigation into the collapse of FTX and Alameda. It is still too early to say what role SBF played in the collapse, or whether he will face any legal consequences.
What are the implications of Ellison’s testimony?
Ellison’s testimony has a number of implications. First, it suggests that SBF was willing to consider raising money from a controversial source in order to repay FTX customers. This raises questions about his judgment and his motives.
Second, Ellison’s testimony suggests that SBF was facing a significant liquidity crisis in the fall of 2022. This is earlier than many people had realized, and it suggests that the problems at FTX were more serious than previously thought.
Finally, Ellison’s testimony suggests that SBF may have been considering other options for raising money to repay FTX customers, besides the Saudi crown prince. This raises the possibility that there may be other parties involved in the collapse of FTX and Alameda.
Also read: Did Sam Bankman-Fried Defraud FTX Customers? Caroline Ellison’s Allegations Suggest Yes
What happens next?
The investigation into the collapse of FTX and Alameda is ongoing. It is still too early to say what the outcome of the investigation will be, or whether SBF or other executives will face any legal consequences.
However, Ellison’s testimony is a significant development in the case. It provides new insights into SBF’s thinking and the financial situation of FTX in the lead-up to its collapse.
The investigation is likely to continue for several months, and it is possible that there will be more revelations about the collapse of FTX and Alameda in the coming weeks and months.
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