More unsettling disclosures and disastrous testimonies have been made against Sam Bankman-Fried during the trial’s third week. Now speculation grows that the once-crypto billionaire is preparing to take the stand himself.
The 31-year-old founder of the now-defunct crypto exchange FTX faces seven federal charges, including wire fraud, securities fraud, and money laundering, after FTX’s collapse, which financially impacted thousands of customers.
After the trial kicked off on 3 October, there has been mounting evidence presented against him over the past two weeks, including admissions of fraud by FTX co-founder Gary Wang and emotionally charged testimony from Caroline Ellison, SBF’s former girlfriend and ex-CEO of Alameda Research.
Nishad Singh’s testimony sheds light on FTX fraud
Nishad Singh, a former FTX engineer, took the stand as the third week began, offering a detailed account of the internal operations that led to the cryptocurrency exchange’s alleged financial misconduct.
Singh, who had been with Alameda Research before joining FTX, is cooperating with authorities following his guilty plea on multiple charges, including conspiracy to commit securities fraud and money laundering, as part of a deal struck earlier this year.
In his testimony, Singh told the court that he discovered an approximately $8billion discrepancy in FTX’s finances in September 2022.
Despite recognising the anomaly, Singh approved transactions that he suspected were funded by customer deposits. He further testified that these funds were directed to Alameda Research to funnel various expenses and investments.
Singh described the financial irregularities as “enormous”, explaining that conversations with Bankman-Fried revealed the money was allocated to several ventures outside of FTX’s regular business activities, including venture investments and political donations.
Singh testified that he initially had admiration for Bankman-Fried, who he went to high school with and once viewed as “formidable” and “brilliant”. But this deteriorated into “shame” when he uncovered how FTX’s leadership allegedly misused the platform’s funds.
Will Sam Bankman-Fried testify?
As the trial progresses, there’s growing speculation about whether Bankman-Fried himself will testify.
His defense team, led by attorneys Mark Cohen and Christian Everdell, has expressed concern over Bankman-Fried’s current health conditions, specifically his ADHD, and its potential impact on his ability to participate meaningfully in the trial.
They’ve requested better access to necessary medication, like Adderall, believing it’s essential for him to maintain concentration during the proceedings.
Cohen and Everdell wrote: “As we approach the defense (sic) case and the critical decision of whether Mr. Bankman-Fried will testify, the defense has a growing concern that because of Mr. Bankman-Fried’s lack of access to Adderall he has not been able to concentrate at the level he ordinarily would and that he will not be able to meaningfully participate in the presentation of the defense case.”
This has led some to speculate if the FTX founder will take the stand.
This decision is often a gamble that attorneys avoid as the defendant could inflict damage on themself. But it could be Bankman-Fried’s best bet as the once-crypto billionaire’s trial is so far being widely accepted as disastrous.
His legal team is also navigating through restrictive pre-trial rulings from Judge Lewis Kaplan, which have narrowed their defense scope.
The prosecution has said it is nearing the end of its case and is expected to wrap up by 27 October, at which time the defense will present its side.
