Adam Yedidia, Sam Bankman-Fried’s college roommate and an early employee of FTX, continued his testimony on Oct. 5, the second day of former FTX CEO Bankman-Fried’s trial in New York. Yedidia was testifying for the prosecution with immunity.
Under examination by Assistant U.S. Attorney Danielle Sassoon, Yedidia told the court that he started as a trader for Alameda Research and then worked for FTX as a software developer from January 2021 through November 2022, when he resigned. In the Bahamas, Yedidia was one of the “people of the house” — the ten people who shared a large apartment in the luxury Albany Resort. He reported to former FTX engineering director Nishad Singh and “informally” to FTX co-founder Gary Wang and Bankman-Fried.
Yedidia said that, as he understood it, when Alameda Research traded on FTX, the ultimate beneficiaries of the profits were Bankman-Fried and Wang.
Yedidia said he was involved in writing the coder to automate customer deposits and withdrawals from FTX. Bankman-Fried was also “very involved” in the project. Yedidia initially thought customer deposits were going to an FTX bank account, but he learned that FTX was having trouble opening a bank account and deposits went to an account in the name of North Dimension Inc., which was controlled by Alameda Research.
Yedidia said customers were instructed to send deposit funds to the North Dimension account, and they did not know it was controlled by Alameda, as far as he knew. He said either Singh or FTX head of settlements Ray Salame told him about the arrangement.
“Sometime in late 2021,” FTX succeeded in opening a bank account and customers had the option to send funds to “FTX Digital Markets,” Yedidia said. He said he was aware that some customer deposits continued to go to the Alameda Research-controlled account after that.
Deposits were also tracked in an internal FTX database in an account called “Fiat at FTX.com,” which contained information, and not money. The sum of customer deposits should equal the amount of liability in “Fiat at FTX.com,” Yedidia explained.
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Yedidia learned in late 2021 that the automation code he had helped develop had a bug. Because of the bug, customer withdrawals lowered the liability recorded in “Fiat at FTX.com,” as was correct, but it did not decrease the liability of Alameda Research to FTX, as it should have.
“Gary [Wang] or…
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