Secret Alameda Recording Reveals Ellison’s Confessions on FTX Deposits

Crypto News – The precise moment Caroline Ellison, the former CEO of Alameda Research, informed staff members that FTX customer deposits were being used is captured in a 75-minute recording that Cointelegraph was able to get.

Secret Alameda Recording Reveals Ellison’s Confessions on FTX Deposits

The entire tape, which Cointelegraph was able to obtain, sheds new light on the tense atmosphere Ellison and the Alameda team were in just before FTX collapsed.

Alameda was kind of borrowing a bunch of money via open-term loans and using that to make various illiquid investments. So like a bunch of FTX and FTX US equity… Most of Alameda’s loans got called in in order to meet those recalls,

Ellison, Nov. 9, 2022

Drappi Tells What He Knows in Court

On October 12, during the eighth day of Sam Bankman-Fried‘s criminal trial, the court also heard excerpts from the audio recording of the meeting as Christian Drappi, a former software engineer at Alameda, testified as a witness.

We ended up borrowing a bunch of funds from FTX, which led to FTX having a shortfall in user funds. FTX basically always allowed Alameda to borrow users’ funds,

Ellison

After Ellison’s evidence, which lasted for over three days, Drappi took the witness stand right away. Drappi and many other Alameda staff members are said to have been unaware of the hedge fund’s alleged use of FTX customer deposits to support its trading activities prior to the meeting.

Drappi can also be heard in the recording asking Ellison when she first learned that Alameda was abusing FTX user deposits and who else at the firm knew about it. At first, Ellison resisted responding, but Drappi persisted. Ellison’s behavior at the meeting, according to Drappi, was “sunken” and didn’t inspire much trust in the Alameda employees, according to Drappi’s evidence. The magnitude of the connection between FTX and Alameda, he claimed, “stunned” him, and he left the company the next day.