How Former FTX Lawyer Daniel Friedberg Became Key to Building Prosecutors' Case Against SBF

The collapse of FTX last November sent shockwaves through the crypto world, and now the pieces of what happened are being assembled in court through an unlikely figure: Daniel Friedberg, the exchange’s former legal counsel.

Inside Information Becomes Government Arsenal

According to recent reporting, Friedberg has provided U.S. prosecutors with critical testimony about how Sam Bankman-Fried orchestrated the movement of customer funds into Alameda Research. This cooperation has become instrumental in constructing the eight-count indictment against the disgraced founder.

The timeline reveals a rapid pivot by Friedberg. After FTX’s implosion in November 2022, FBI agents reached out on November 14th. Rather than facing potential legal exposure himself, the former lawyer signaled willingness to cooperate with investigators. By November 22nd, he sat down with a coordinated team including FBI officials, Department of Justice representatives, prosecutors from the Southern District of New York, and SEC investigators.

Navigating Attorney-Client Privilege

What makes Friedberg’s cooperation particularly significant is the procedural groundwork laid before his testimony. FTX’s bankruptcy administrators worked with him to establish what information could be shared with authorities without breaching attorney-client privilege protections. This legal negotiation cleared the path for detailed disclosures about fund management mechanisms and how Alameda Research functioned as an operational entity.

The Wider Asset Picture

While Friedberg’s testimony focused on the internal mechanics of fund diversion, authorities simultaneously pursued the recovery of Bankman-Fried’s external holdings. The Justice Department successfully seized approximately $460 million in Robinhood shares during bankruptcy proceedings in Delaware—shares that Bankman-Fried and Gary Wang had accumulated in mid-2022. This seizure resolved competing claims from BlockFi and other interested parties over the 56 million share position.

International enforcement efforts complemented these domestic actions. The Bahamas Securities Commission froze $3.5 billion in customer cryptocurrency holdings, expanding the scope of asset recovery beyond U.S. borders.

What’s Next for the Case

Friedberg is positioned to serve as a government witness rather than a defendant, a crucial advantage for prosecutors building their narrative. The eight counts pending against Bankman-Fried—including fraud charges—now have testimony backing the government’s technical understanding of how FTX’s systems were exploited. Bankman-Fried himself was arrested in the Bahamas and extradited to Manhattan, where he faced trial after securing bail at $250 million in October 2023.

The convergence of Friedberg’s insider knowledge with seized financial records and international cooperation demonstrates how the investigation transcended a single company’s bankruptcy to become a multi-agency pursuit of accountability.