Alameda Research Allegedly Paid Chinese Officials $150M To Regain $1B Worth Of Exchange Accounts


In a surprising twist during the Sam Bankman-Fried trial, former Alameda Research CEO, Caroline Ellison, testified that the crypto trading firm allegedly paid Chinese officials to unlock their Alameda trading accounts on OKX and Huobi in China. This revelation shed light on the motivations and actions of Bankman-Fried and Ellison.

Key Takeaway

Former Alameda Research CEO Caroline Ellison testified that the firm allegedly made payments to Chinese officials in order to regain access to

billion worth of exchange accounts.

Prominent Witnesses and Testimonies

Caroline Ellison, the former CEO of Alameda Research, provided crucial testimony regarding the events leading up to the unlocking of the frozen accounts. Ellison stated that Bankman-Fried, who was the CEO at the time, admitted that a colleague named David Ma, who had connections in China, had discovered a way to resolve the account freeze. In November 2021, the accounts, valued at approximately $1 billion, were ultimately unfrozen.

Possible Bribery and Payment Process

To successfully unlock the accounts, Ellison revealed that she made several “crypto transfers” totaling between $100 million and $150 million to undisclosed accounts. Although she was uncertain of the recipients at that time, it later came to light that the funds were paid to Chinese officials. Ellison explained that Bankman-Fried and another executive, Sam Trabucco, instructed her to carry out these transactions via a Signal chat.

Alternative Strategies and Controversial Discussions

Prior to resorting to alleged bribery, Ellison and her colleagues attempted various strategies, such as involving lawyers to contact the exchanges and government officials. Notably, there were even discussions about hiring Thai prostitutes to open accounts on the exchanges, hoping that they could facilitate funds transfers. However, none of these alternative methods yielded the desired results.

An Alameda trader, referred to as “Handi,” quit in January 2022 due to her objections to the decision to pay bribes to Chinese officials, as her father had a similar occupation. During a heated argument with Bankman-Fried, which occurred before her resignation, Handi claimed he told her to “shut the fuck up,” as testified by Ellison.

Evidence and the Importance of Secrecy

Ellison shared a list of considerations with prosecutors, which included a note asking, “150m from the thing?” in reference to the money transferred to regain access to the frozen accounts. When questioned about her avoidance of explicitly mentioning the payment to China, Ellison explained that she refrained from putting it in writing due to concerns that it might leak and be used against Alameda Research in a future court case.

Despite attempts by Mark Cohen, Bankman-Fried’s lawyer, to strike Ellison’s statement about not wanting the payments in writing, Judge Kaplan overruled the objection, emphasizing that further discussion on the matter was unnecessary.

The trial continues as the testimonies and evidence provide valuable insights into the actions taken by Alameda Research to regain access to their exchange accounts in China.

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