SBF Trial, Day 5: SBF's Defense Finally Found Its Legs, But Can It Counter Caroline Ellison?

Caroline Ellison, former CEO of Alameda Research and SBF's ex-partner, took the stand to reveal the alleged financial mismanagement at Alameda and FTX, which she claimed was at Bankman-Fried’s direction. The cross examination of Gary Wang finally began to show how SBF’s lawyers plan to defend him, though Wang largely appeared to be a yes man who simply trusted and followed his friend and co-founder.

Ellison's revelations included Alameda's hidden trading of FTT to prop up its price, her warnings to SBF about Alameda’s inability to pay back its lenders if he put billions more into venture investments, and his views on risk and “expected value.” For instance, she claimed he said if, with a coin toss came up tails and would mean Earth’s destruction, he would toss the coin if there it was twice as likely that it would more than double prosperity on Earth. However, her testimony seemed designed to preemptively rebut the defense’s potential argument that Alameda needed to borrow customer funds because she had not hedged. 

Catch up on Unchained’s previous coverage: 

• Sam Bankman-Fried Trial: Here’s Everything That Happened So Far
• SBF Trial, Day 1: Possible Witnesses Include FTX Insiders, Big Names in Crypto, and SBF’s Family
• SBF Trial, Day 2: DOJ Says Sam Bankman-Fried ‘Lied’ While Defense Claims His Actions Were ‘Reasonable’
• SBF Trial, Day 3: Why a True Believer in FTX Flipped Once He Learned One Fact
• SBF Trial, Day 4: SBF’s Lawyers Annoy Judge Kaplan, While Wang Reveals Alameda’s Special Privileges
• Did Sam Bankman-Fried Have Intent to Defraud FTX Investors?
• Here’s How Sam Bankman-Fried’s High-Stakes Trial Could Play Out
• SBF Trial: How Sam Bankman-Fried’s Lawyers Might Try and Win His Case
• The High-Stakes Trial of Sam Bankman-Fried Begins: What to Expect
• In the SBF Case, Elite Corruption Is What’s Really on Trial

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