FTX co-founder admits he and Sam Bankman-Fried committed fraud

Gary Wang, who co-founded FTX with Bankman-Fried, told jurors — in compliance with an earlier plea deal — that he was guilty of wire fraud, securities fraud and commodities fraud, and that he committed those crimes under the direction of Bankman-Fried.

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Unlike regular customers of FTX — a platform for individual investors and institutions to trade crypto — Alameda was allowed to run a negative balance and make “unlimited withdrawals” from FTX customers, Wang said.

Alameda had a $65 billion line of credit to use as collateral when placing bets — a figure that is orders of magnitude larger than the credit that FTX would give to other large investors.

Asked by Assistant US Attorney Nicolas Roos whether those advantages were ever disclosed to customers or investors, Wang replied: “No.”

Wang also said that he personally wrote the computer code for some of the features, and did so at Bankman-Fried’s direction.

Source: FTX co-founder admits he and Sam Bankman-Fried committed fraud