
The FBI's ongoing fraud trial involving the disgraced crypto tycoon Sam Bankman-Fried has resulted in a number of shocking truths. The latest one came from Gary Wang, the co-founder of FTX, who admitted the now-bankrupt company's insurance number was fake and that its balance was generated by a random number generator.
FTX deceived investors through its actions, BitMEX Research, the research arm of cryptocurrency exchange BitMEX, said, according to Wang's testimony before the court.
FTX's published insurance fund number was fake, and FTX's published insurance fund balance was produced by a random number generator, BitMEX Research, which claims it filters out the hype with evidence-based reports on the cryptocurrency ecosystem.
It released a court transcript of Wang's testimony to support its claim.
The number is just the dollar amount. And two, the number listed here does not match what was in the database, said Wang, when Judge Lewis Kaplan asked about the accuracy of the numbers on the company's disclosure of the insurance fund.
Then, apart from admitting the number was fake and that it was actually lower than what was listed, Wang said, they came up with the figures.
The daily volume is getting the total volume of trades from the past 24 hours on FTX. In line 19, it's taking that number, multiplying it - then multiplies it by a random number that's around 7500, and then dividing the result by a billion. It's a number that shows up on the website, the former FTX CTO said.
Wang testified in court last Thursday that he, Bankman-Fried Caroline Ellison, the former CEO of Alameda Research, and Nishad Singh, the FTX director of engineering, committed wire fraud, securities fraud and commodities fraud.
''Sam handled'' speaking to media, lobbying, talking with investors, Wang said. I just coded, but it was Sam's decision to make [regarding any disagreements].