Crypto
Caroline Ellison, saying Sam Bankman-Fried corrupted her values, found relief when truth came out
NEW YORK (AP) — Sam Bankman-Fried’s former top executive, testifying in Manhattan federal court Wednesday, blamed the FTX founder for corrupting her values so she could lie and steal and got emotional when describing the cryptocurrency empire’s final days, saying the collapse of his businesses resulted in a “relief that I didn’t have to lie anymore.”
Caroline Ellison, who eventually was made chief executive of Bankman-Fried’s cryptocurrency hedge fund, Alameda Research, blamed the man she was entwined with romantically for several years since 2018 for creating justifications so that she could do things that she now admits were wrong and illegal.
Testifying for a second day, she recalled that Bankman-Fried said he wanted to do the greatest good for the most people and that rules like “don’t lie” or “don’t steal” must sometimes be set aside, effectively that the ends justified the means.
Assistant U.S. Attorney Danielle Sassoon asked Ellison how she was affected by Bankman-Fried’s philosophy.
“I think it made me more willing to do things like lie and steal over time,” she said.
Ellison spent much of the last two days walking the jury through how she, at Bankman-Fried’s direction, repeatedly had to tap into the customer deposits at FTX to solve problems at the hedge fund or at the exchange. FTX deposits would be withdrawn to pay for new investments or political donations, or to hide steep losses on Alameda’s balance sheet, she testified. All of this was done at the direction of Bankman-Fried.
All the while, Bankman-Fried put on a public veneer of being a good steward of cryptocurrency markets, cultivating relationships with politicians and the public. Ellison testified that Bankman-Fried once described his then-unkept hair as “valuable” to his image, and deliberately drove a Toyota Corolla to appear modest.
After several hours on the witness stand, Ellison got choked up as she described the final days of FTX and Alameda, saying that the early November period before the businesses filed for bankruptcy “was overall the worst week of my life.”
Still, she said she felt bad for “all the people harmed” when there wasn’t enough money left for all of FTX’s customers and Alameda’s lenders.
When the end arrived, Ellison said it left her with a “sense of relief that I didn’t have to lie anymore.”
Alameda was seen as a dumping ground for the problems of FTX and Bankman-Fried, and its fuel was FTX customer money. When FTX lost hundreds of millions of dollars on a cryptocurrency known as Mobilecoin due to failures of FTX’s systems, the losses were moved onto Alameda’s balance sheet.
Some of the more surprising testimony from Ellison came as she described what she said was a large bribe of over $100 million that was paid to Chinese officials to get them to free up $1 billion that was frozen in 2021 in cryptocurrency exchanges in China because of a money laundering investigation of someone who had once been an Alameda customer.
She said FTX and Alameda executives tried hiring a lawyer in China to negotiate the release of the funds and tried to siphon away the $1 billion through accounts set up in the names of “Thai prostitutes” before finally settling on the bribery scheme.
“Sam initially said no, but eventually changed his mind,” Ellison said. The funds were eventually released. While the payments came out of Alameda’s accounts, the funds ultimately came from FTX customer deposits.
Bankman-Fried was charged earlier this year with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act in connection with what prosecutors said was a $40 million bribe, but the charge was withdrawn because Bahamian authorities had not approved it as part of Bankman-Fried’s extradition.
Ellison revealed that she had to doctor balance sheets to try to hide that Alameda was borrowing about $10 billion from FTX customers in June 2022, when the cryptocurrency market was falling dramatically and some lenders were demanding that Alameda return their investments in full. She said she once created seven different balance sheets after Bankman-Fried directed her to find ways to conceal things that might look bad to Alameda’s lenders.
“I didn’t really want to be dishonest, but I also didn’t want them to know the truth,” Ellison said.
She said a few years earlier, she would never have believed that she would one day be sending false balance sheets to lenders or misallocating customer money, “but I think it became something I became more comfortable with as I was working there.”
Ellison said she was in a “constant state of dread” at that point, fearful that a rush of customer withdrawals from FTX couldn’t be met or that what they had done would become public.
“In June 2022, we were in the bad situation and I was concerned that if anybody found out, it would all come crashing down,” she said.
The crash came last November, when FTX couldn’t fulfill a rush of customer withdrawals, forcing it into bankruptcy and prompting investigations by prosecutors and regulators.
“I was terrified,” she said. “This was what I had been worried about the past several months and it was finally happening.”
Ellison, 28, pleaded guilty to fraud charges in December, when Bankman-Fried was extradited to the United States from the Bahamas.
She is expected to be cross-examined on Thursday.
Bankman-Fried, 31, has pleaded not guilty to fraud charges. His lawyers say he was not criminally to blame for what happened to his businesses.
Initially confined to his parents’ Palo Alto, California, home under terms of a $250 million bond, Bankman-Fried has been jailed since August after Judge Lewis A. Kaplan concluded that he had tried to improperly influence potential witnesses, including Ellison.
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For more AP coverage of Sam Bankman-Fried and FTX: https://apnews.com/hub/sam-bankman-fried
An up-and-coming player in the world of cryptocurrency is looking to revolutionize the industry through its unique processes that highlight sustainability.
According to Be3, cryptocurrency XRP, developed by Ripple Labs, could have a “transformative impact on both finance and environmental sustainability” thanks to its unique consensus mechanism that does not require mining and uses a negligible amount of energy even as it scales.
It generates a minuscule amount of pollutants per transaction while producing 1,110 pounds of electronic waste and impacting just over 8 cubic miles of natural resources.
This approach separates XRP from its contemporaries, which often rely on the notoriously power-hungry proof-of-work systems and hulking mining centers that can destabilize the grid.
Statistics provided by TRG Datacenters show that XRP is the second-most eco-friendly cryptocurrency behind IOTA, consuming just 0.0079 kilowatt-hours per transaction. Comparatively, bitcoin ranks last at a staggering 707 KWh per transaction.
Furthermore, the cryptocurrency became the first major global blockchain to achieve carbon net zero by purchasing enough renewable energy to offset its minimal energy requirements, per the XRP Ledger.
Be3 also noted other features that make XRP an attractive option for institutions focused on environmental responsibility, as it takes just three to five seconds to settle at fractions of a cent per transaction.
It’s a welcome addition to a sector that desperately needs more sustainable options. A study by the International Monetary Fund found that crypto mines, in conjunction with artificial intelligence data centers, accounted for 2% of global electricity demand and 1% of carbon dioxide pollution in 2022.
The United Nations found that the bitcoin mining network used 173.42 terawatt-hours of electricity between 2020 and 2021, resulting in a carbon footprint equivalent to burning 84 billion pounds of coal.
Coal and natural gas also supplied 66% of the energy for mining operations during this period, polluting the planet with planet-warming gases.
Luckily, the sector has made significant strides in recent times in an effort to become more eco-friendly.
Alephium, which utilizes a proof-of-work blockchain, has partnered with Gigatons to implement a proof-of-less-work consensus that is significantly more energy efficient.
Meanwhile, Ethereum has transitioned to a proof-of-stake system that has cut its energy consumption by nearly 100%.
“In a world increasingly attentive to environmental impact, XRP’s innovative technology not only promises efficiency but also a greener future,” Be3 wrote.
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Zagreb, Croatia–(Newsfile Corp. – January 12, 2025) – ZIUM, a cutting-edge agency founded to tackle some of the most pressing challenges in social media and digital marketing, is now officially open for business. Specializing in Instagram username claims, account unbans, and cryptocurrency marketing, ZIUM has positioned itself as a trusted partner for individuals and businesses seeking innovative solutions in the digital age.
The agency operates at the intersection of technology, social media, and blockchain marketing, empowering clients to unlock their full potential online. With a dedicated team of experts and a results-driven approach, ZIUM is redefining the way people navigate the ever-changing online landscape.
ZIUM
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A New Era of Digital Problem Solving
ZIUM’s services address real-world challenges in today’s digital ecosystem. Instagram, one of the largest and most influential social platforms, has become a critical tool for personal branding, business promotion, and community engagement. However, issues such as unavailable usernames or unfair account suspensions can hinder growth and cause frustration. ZIUM steps in to provide solutions that are fast, efficient, and tailored to each client’s needs.
Additionally, ZIUM excels in cryptocurrency marketing, offering projects and startups a strategic edge in the fast-paced blockchain industry. By combining deep knowledge of crypto trends with cutting-edge marketing strategies, the agency helps blockchain projects stand out in an increasingly crowded market.
Core Services Offered by ZIUM
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Instagram Username Claims
In the crowded social media space, having the perfect Instagram username can make all the difference. Whether it’s for a brand, influencer, or business, ZIUM specializes in acquiring sought-after usernames to align with clients’ goals and identities. The agency handles the process from start to finish, ensuring a smooth and hassle-free experience. -
Instagram Account Unbans
Account suspensions on Instagram can be devastating, especially for businesses and influencers relying on the platform for engagement and revenue. ZIUM offers expert account recovery services, helping clients navigate Instagram’s policies to regain access to their accounts quickly and effectively. -
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The cryptocurrency space is highly competitive, and visibility is key. ZIUM provides end-to-end marketing strategies tailored to blockchain projects, ensuring they reach the right audience. From brand development to targeted campaigns, ZIUM helps crypto ventures grow and thrive in an ever-evolving market.
Donald Trump is making news once more, but this time it’s not for political reasons; it’s about cryptocurrency. As he prepares to return as the 47th President of the United States, Trump will become the first sitting president to own meme currencies, a decision that has stirred both enthusiasm and skepticism in the crypto community.
Trump: A Significant Crypto Portfolio
Recent sources claim that Trump’s crypto wallet consists largely of meme coins and is valued roughly $8 million. Among the assets are $1.5 million in a meme currency with Trump-themed design and $5.5 million in TROG tokens.
In addition, he has about 1.3 billion GUA coins, which amounts to nearly $400,000, and $167,000 in TRUMPIUS tokens. This is a first of its kind, where Trump becomes an oddity in the world of politics and cryptocurrency, considering his earlier reluctance towards digital assets.
DONALD J. TRUMP WILL BE THE FIRST SITTING US PRESIDENT TO HOLD MEMECOINS pic.twitter.com/ODlNXDaKIT
— Arkham (@arkham) January 10, 2025
From Skepticism To Support
Trump’s journey into the crypto world is notable. He had been a strong critic of Bitcoin and other cryptocurrencies, calling them scams. But that all changed in 2024 when he started publicly endorsing Bitcoin and speaking out for the right to own it. That’s a broader trend among politicians, who are increasingly recognizing the potential of cryptocurrencies and their growing popularity among voters.
Trump’s financial success in the digital sphere was also aided by his venture into non-fungible tokens (NFTs) on Ethereum. Trump reportedly made a good living from these endeavors, and he currently owns roughly 496.77 ETH, which is worth about $1.6 million.
Implications For Regulation
Many people are eager to see how Trump’s administration will regulate cryptocurrencies now that he is back in office. A possible change toward a more advantageous regulatory climate for digital assets is hinted at by the nomination of important individuals like David Sacks as “Crypto Czar” and Paul Atkins as SEC chair. This could result in more precise rules for investors and businesses involved in the cryptocurrency industry.
Donald Trump. Image: Ronda Churchill/Reuters
The policies by Trump are already changing market dynamics as everybody is anxiously awaiting them. During this time when Bitcoin hit a record high of $108k, while meme coins surged, analysts still feel that Trump could make the year 2025 a major turning point in cryptocurrencies.
Meme Coin Boom
The rise of Trump-owned meme coins is indicative of a broader cultural shift among younger investors who are fed up with established financial institutions. This combination of the political influence of Trump and the speculative nature of meme coins puts a scenario under which political events could significantly affect cryptocurrency markets. Thus, while the investors go about this, they are not ignorant of the volatility that is usually associated with meme coins.
Featured image from Fortanix, chart from TradingView
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