The SBF Trial: Ex-Alameda Research CEO Says She Was in a 'Constant State of Dread'

All right, Caroline Ellison is heading to court for a third day of testimony against Sam Bateman Fried. The former Ella research CEO said yesterday on the stand that she was in a constant state of dread adding that she knew quote, we would have to take the money from our FTX line of credit and that was money that could be called in at any time. And quote, Emily, you were actually in court again to watch all of this play out what stuck out to you a lot happened yesterday. So there were a lot of revelations, some of which were more relevant than others to the actual trial. So there was a lot of commotion about, you know, talk about basically paying off Chinese officials and, and, and um uh there all sorts of stuff came out. But, you know, the judge pointed out that these were not actually the actual charges in the case. It was also, you know, a very emotional day I think for Caroline, you know, as you said, she brought up a lot, this idea that she had been filled with dread for a long time because she had basically been hiding the truth of the finances of Alameda and FTX. And so, you know, she had a sense of relief when it finally all came out. And, yeah, it was a lot of drama. She, you know, she, there were some tears because, you know, she, she said she felt this mixture of relief, but she also wants to take responsibility. So, yeah, there was a lot going on in, in, in, in court yesterday and there was also this whole thing I repeatedly about uh the the spreadsheets because of course, the spreadsheets ultimately led to their undoing when it was revealed by coin desk. But even those spreadsheets apparently weren't the spreadsheets that were, they, even those were in aurate and they were pretty damning. What, what happened with that and, and what was your take on, you know, as she was telling the story uh uh of all these fake spreadsheets and, and signal messages and all this stuff like, like what was your impression as she went through all this? Well, of course, you know, we're watching it, you know, coin desk gets this major shout out in, in, in court because, you know, Caroline drew a very clear cause and effect between the balance sheet that um was uh that, that Ian Allison wrote an article about in coin desk in November and that kind of was the beginning of the end. And I think she really cited that as a cause and effect like this is the beginning of the end of FT X's downfall. But Lawrence, as you said, what's interesting about it is so that balance sheet raised a lot of eyebrows because it basically showed two things, one that there was a lot of F TT uh on Alameda balance sheet. It also raised a lot of questions about the relationship between Alameda and FTX. Um And but, but as you said, she, she mentioned that actually the real balance sheets were actually worse, you know, this was one that was being shown to kind of like outside parties, third parties, but it actually didn't even reflect the true gravity of the situation. So it's kind of remarkable that this balance sheet, that kind of was the beginning of the end of bringing down the entire FTX Empire was only part of the story, right? It actually got worse after that, but there was, there was a whole chain of events, right? As you all remember because it was, you know, the balance sheet being published and CZ saying that he was liquidating his F tt you know, so she kind of went through this whole thing and she was sort of watching this in real time and how, you know, she had this mixture of emotions again, you know, in part, um this feeling of relief that ok, now, like we don't have to hide this anymore. Everyone's gonna know like this is, this is, this was a long time coming and that was the rosy, uh, that was like a rosy scenario with that, that, that balance sheet, in fact, uh, but it seems that everything really started with our dear and lovely friend Dow. Well, there was, you know, a lot of, a lot of, a lot of stuff going on and, and, you know, I mean, that's, that was, that's really the, you know, the TLDR of Caroline's testimony is that there was just, you know, this brewing, um, disaster waiting to happen where, you know, the finances just were not as they seem to be. Um, and, you know, she was part of that misrepresentation, Emily, you know, cameras aren't allowed in the courtroom. Um, what was the jury's reaction to Caroline's testimony? How did she handle herself on the stand? Talk to us about a little bit about what people were feeling in the courtroom? Yeah. So I obviously can't speak for the jury. You know, look, I think that Caroline, I think, you know, you can also see just like on crypto Twitter, like some of the reactions to Caroline. I think there are mixed reactions, you know, on the one hand, maybe some people feel sorry for her. On the other hand, you know, she is pleading guilty, she is admitting to these crimes. And, you know, I think one thing, one theme that came up again was her Cooper with the prosecution and her Cooper operation with the government. And what that means and, you know, this is being teased out a lot in court. I, I guess people feel like it's important for the jury to understand what this means and basically what it means is that, you know, she agreed to Cooper, that does not mean that, you know, she is guaranteed a lighter sentence. She's not guaranteed anything. And this was sort of brought up again and again. Right. It's like, ok, this is a Cooper agreement and maybe, maybe she'll get a letter in the end. There'll be a letter basically to the judge saying, ok, you know, you can have a, you know, recommending a more lenient sentence, but this is not at all guaranteed. And I really felt like it was, that was being teased out many, many, many times. But yeah, she did start crying. You know, there were tears, there was a box of tissues offered. But to be honest, I'm not sure that, you know, I'm not sure how much people were moved and I know we'll get into this with our next guest Lisa, but there does seem to be the impression that the judge is not very sympathetic to the defense. That sort of it's been toned down a little bit from the beginning, but you can kind of tell that he's a little bit impatient with the defense. Um And so, yeah, I think that is also probably um setting a tone, how accurate are Nick Day's uh uh uh images the, the drawings that he's been doing right. She has no, she has no, she has no, like, you know, no eyes or, but, you know, besides that I think it's, they're perfectly accurate. So.