Turkish-Iranian gold trader Zarrab has plead guilty and will testify as the prosecution's key witness at the U.S. trial of a banker on charges the two of them violated economic sanctions against Iran, ending weeks of speculation in a case that has strained relations between the U.S. and Turkey.

The revelation came Tuesday as a defense lawyer asked for a two-week delay of the New York City trial of Mehmet Hakan Atilla, deputy CEO of state-owned Halkbank, saying he needed time to prepare for Zarrab's testimony. Defense lawyer Robert Fettweis said prosecutors recently released 10,000 pages of evidence related to Zarrab, including emails.

U.S. District Judge Richard Berman rejected a postponement, saying lawyers should have known for months that Zarrab would testify.

Assistant U.S. Attorney Sidhardha Kamaraju said Zarrab, a businessman and gold trader, would take the stand Wednesday.

A prosecutor began opening statements at a trial in New York City by saying that the lies of a Turkish banker

Assistant U.S. Attorney David Denton began opening statements and said Atilla told lies that blew a billion dollar hole in the U.S. economic sanctions against Iran, while giving access to U.S. banks and threatened U.S. national security. Denton said Atilla and Zarrab were part of a conspiracy that involved top officials in the Iranian and Turkish governments.

Atilla, who was arrested while in the U.S. in March 2017, has pled not guilty to the charges that accused him of conspiring with Zarrab.

Zarrab had stopped appearing in court weeks ago, prompting speculation he'd cut a deal and was cooperating with U.S. officials. A prosecutor said in court Tuesday that Zarrab would testify as part of a plea deal but gave no other details on it.

President Recep Tayyip Erdoğan has repeatedly asked the U.S. to release Zarrab, and recently, Turkey's Deputy Prime Minister Bekir Bozdağ said Zarrab was a "hostage" being forced to testify against Turkey's government.

On Tuesday, an Istanbul court has issued arrest warrants for former banking watchdog auditor Osman Zeki Canıtez and former main opposition Republican People's Party (CHP) Deputy Aykan Erdemir for supplying fake evidence and documents to U.S. authorities. Both names are included in the prosecution's witness list.

Zarrab, a 34-year-old dual citizen of Turkey and Iran, was arrested on a trip to the U.S. in March 2016 as he prepared to take his family to Disney World.

Zarrab was charged in the U.S. with conspiring to help the Iranian government and Halkbank make hundreds of millions of dollars in financial transactions that violated U.S. sanctions. Some of the transactions were made through U.S. financial institutions, investigators said, clearing the way for a prosecution in New York.

Earlier this year, Zarrab hired former New York City Mayor Rudolph Giuliani and former U.S. Attorney General Michael Mukasey to try and broker a diplomatic solution to the case.

Speculation about a Zarrab plea deal intensified over the summer amid news reports that special counsel Robert Mueller was scrutinizing former Trump administration national security adviser Michael Flynn over his undisclosed lobbying work for the government of Turkey. Among other things, Flynn had written an editorial, published on election day, urging the U.S. to extradite Gülen.