Court testimony contradicts tweet claiming FTX was in good condition

In court, a co-founder of FTX testified that a tweet sent by Sam Bankman-Fried claiming that the cryptocurrency exchange was "fine" was false. Gary Wang, a former executive at FTX, stated that Bankman-Fried was aware of an $8 billion deficit when he made the post, and the company filed for bankruptcy shortly after. Bankman-Fried is currently on trial for fraud, and Wang has already admitted guilt. Prosecutors are examining the disconnect between FTX's public image and its true financial situation, with Wang revealing that Bankman-Fried made misleading statements about the firm's financial health. Wang also mentioned that customers faced difficulties withdrawing their funds from FTX, leading to its collapse. Bankman-Fried has been charged with fraud, money laundering, and misrepresentation, but he denies these allegations. The Department of Justice alleges that he used customer funds for personal expenses through his other company, Alameda. Wang testified that this went against their public commitment not to use customer funds in that way. The court heard that Alameda was consistently withdrawing more money from FTX than the exchange received in fees. Wang and Bankman-Fried debated the increasing deficit and eventually estimated it to be around $11 billion. Wang also revealed unique features of Alameda's account on FTX that allowed it to have a negative balance and access a $65 billion line of credit. Bankman-Fried's lawyer suggested that these features were due to Alameda's role as a market-maker on the platform. The trial is expected to last for six weeks, and Wang will continue to testify, followed by Caroline Ellison, Bankman-Fried's former girlfriend and the former CEO of Alameda, who has also pleaded guilty.