Before he could testify before Sam Bankman-Fried, Adam Yedidia offers immunity

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Before he could testify before Sam Bankman-Fried, Adam Yedidia offers immunity

before Adam Yedidia could testify before Sam Bankman-Fried at the FTX cofounder's criminal trial, he needed reassurances.

In federal court in downtown Manhattan on Wednesday, Yedidia told jurors that he insisted on getting immunity from future prosecution to testify about his experience working for the now collapsed cryptocurrency trading platform FTX, where he was a software developer.

Yedidia said he was not available on the witness stand, saying that he did not know if he was in danger.

Prosecutors allege that Sam Bankman-Fried defrauded depositors and investors at FTX, a cryptocurrency exchange he once ran, in part by commingling customer funds with Alameda Research, a crypto hedge fund he also controlled.

Before Yedidia completed his testimony on Wednesday afternoon - to be continued on Thursday morning - he didn't talk about the software code he was worried about. Bankman-Fried directed employees to write computer code that would enable funds to move seamlessly between FTX and Alameda Research, allowing the firm to take FTX customer funds and use the money for risky cryptocurrency bets.

In his seat, Yedidia shifted between questions that he responded quickly and concisely. The judge in charge of the case, Lewis Kaplan, granted him immunity ahead of the trial's start earlier this week. Prosecutors sought immunity for two witnesses in the case, according to letters filed to the docket.

Prosecutors also reached cooperation agreements with three executives in Bankman-Fried's orbit, including Alameda Research CEO Caroline Ellison and FTX cofounder Gary Wang. Prosecutors said Wang would testify in a rehearse by the end of the week.

While Yedidia cannot be prosecuted for what he will testify about, he said he believed he could still face criminal charges for perjury if he lies on the stand.

Bankman-Fried and Yedidia lived and worked together in college, he testified. In 2017, he worked as a trader at Alameda Research for two months before leaving to pursue a PhD.

In 2021, he returned to Bankman-Fried, this time as software developer at FTX.

The two became roommates again. Yedidia said he lived in a 35 million-dollar penthouse apartment in the Bahamas, which he said Alameda Research bought in Bankman-Fried's direction. In total, there were nine employees living there.

In November 2022, Yedida said he resigned from FTX after learning that Alameda Research used FTX customer funds to repay creditors.

That was the last time he saw Bankman-Fried in person, he said, until testifying at his criminal trial.

A former FTX customer who lost thousands of dollars by being unable to withdraw funds from the exchange at the time of its collapse, Yedidia said.

Bankman-Fried's lawyers alleged on Wednesday that he stole more than $10 billion from FTX customers, telling them they could access their money whenever they wanted.

Bankman-Fried, who built two lucrative businesses in the span of a few years, said he was a'math nerd' who forgot some aspects of risk management. Bankman-Fried's main failing was entrusting his executives, including ex-girlfriend Caroline Ellison, to run the business.