FTX Developer Finds $8B Accounting Error Tying Customer Funds to Alameda Debts

Former FTX developer Adam Yedidia found a bug in his code that understated Alameda Research's liabilities by $500M, later growing to $8B.

Yedidia confronted a nervous SBF about the issue on a Bahamas paddleball court. SBF said they were no longer "bulletproof."

Yedidia testified about the close financial ties between FTX and Alameda, including shared offices and executives.

Alameda Research used FTX customer deposits to repay its own debts unbeknownst to customers.

The bug and co-mingling of funds between the two companies contributed to FTX's collapse when its financials were revealed.