Gary Wang Tells FTX Jury Alameda Had a $65 Billion Credit Line

Gary Wang, an FTX co-founder and its former chief technology officer, told a Manhattan federal jury on October 6, 2023 that Alameda Research received software-enabled privileges unavailable to ordinary customers of the cryptocurrency exchange.

According to contemporaneous courtroom reports, Wang testified that Sam Bankman-Fried directed him to modify FTX’s code so Alameda could maintain negative balances, avoid automatic liquidation and draw on a line of credit eventually configured at approximately $65 billion. Wang also described an approximately $8 billion deficit associated with Alameda when FTX faced a wave of withdrawals in November 2022.

The testimony put software architecture at the center of the government’s criminal case. It presented the FTX collapse not simply as a failed trading strategy or a liquidity crisis, but as the alleged result of undisclosed operational choices that gave an affiliated trading firm access to exchange resources and customer assets.

What Wang told the jury

Wang testified that Alameda’s privileges expanded as FTX grew. The Associated Press reported that he described a line of credit reaching $65 billion and the ability to withdraw more assets than Alameda held on the exchange. Reuters reported that Wang said no other FTX customer had the same collection of privileges.

The two figures described different things. The $65 billion amount was the configured credit ceiling in FTX’s system, not a claim that Alameda had borrowed that entire amount. The approximately $8 billion figure was Wang’s account of the shortfall he calculated during the November 2022 withdrawal crisis. It was testimony about an internal balance at a particular point, not an audited valuation or a market-wide loss estimate.

Wang also addressed Bankman-Fried’s November 7, 2022 public assurances that FTX and its assets were sound. According to Reuters, Wang testified on October 6, 2023 that those assurances were false because the exchange lacked enough assets to meet customer withdrawals.

FTX entered bankruptcy proceedings on November 11, 2022.

Why the code evidence mattered

Cryptocurrency exchanges commonly rely on automated margin controls to liquidate positions before losses exceed posted collateral. Wang’s account suggested that Alameda was exempted from important parts of that control system while also receiving unusually broad borrowing capacity.

That distinction mattered institutionally. FTX had presented its risk engine as a protection against cascading losses and had publicly portrayed Alameda as an ordinary market participant. If an affiliated firm could bypass liquidation and carry a deeply negative balance, customers and investors lacked material information about both counterparty exposure and the custody of assets entrusted to the exchange.

The October 6 testimony was consistent with records already public by that date. In December 2022, the Commodity Futures Trading Commission alleged that FTX employees, including Wang, created an “allow negative” feature and an effectively limitless credit line for Alameda. The agency said the features were not disclosed publicly. The Securities and Exchange Commission had made parallel allegations concerning customer assets and special treatment.

Testimony was not a verdict

Wang was a cooperating government witness who had pleaded guilty in December 2022 to criminal charges including wire fraud and commodities fraud. His cooperation and hope for leniency gave the defense a reason to challenge his credibility.

Bankman-Fried had pleaded not guilty to the seven counts being tried. His lawyers argued during the October 2023 opening statements that he had not intended to defraud customers and that cooperating executives were recasting decisions they had previously accepted. During cross-examination on October 6, Wang agreed that some accommodations helped Alameda supply liquidity as an early FTX market maker.

Those qualifications did not resolve whether the later scale and use of the privileges were legitimate. As of October 6, the jury had not returned a verdict, Wang’s cross-examination was unfinished, and the courtroom accounts remained allegations and testimony rather than findings against Bankman-Fried.

The event-day significance

The hearing supplied one of the clearest contemporaneous explanations of how FTX’s internal code, affiliate relationship and customer-asset deficit allegedly connected. It also illustrated a broader control problem for centralized digital-asset venues: customers could see balances on a screen without independently knowing whether an exchange had granted hidden exceptions elsewhere in its ledger.

No cryptocurrency price or market-return claim is made here. The significance rests on the reported courtroom evidence and the institutional questions it raised on October 6, 2023 about custody, conflicts of interest, software controls and disclosure.