- The former FTX Head of Engineering, Nishad Singh, testified that Sam Bankman-Fried continued to spend excessively, knowing of the deficit.
- Singh’s testimony revealed that FTX was involved in “bad business decisions.”
- Bankman-Fried was unwilling to cut endorsements and sponsorships, according to Singh.
The latest witness in Sam Bankman-Fried’s trial was former FTX Head of Engineering Nishad Singh, who claimed that Bankman-Fried was using customer funds to “fuel his spending spree.”
Laura Shin, a crypto journalist, shared that Singh described FTX as an organization that allegedly defrauded its customers by freely spending customer assets on ill-advised investments, sponsorships, and political action.
Singh, former Alameda CEO Caroline Ellison, and former FTX Chief Technology Officer Gary Wang testified for the prosecution as part of a plea agreement.
Singh shared that SBF continued to spend excessive amounts of money even after knowing of the $8 billion short in Alameda’s balance sheet. The deficit had reached $13 billion by September 2022. He said:
I learned of the hole, and even after that, implicitly and explicitly, I green-lit transactions that I knew must have been digging the hole deeper and therefore coming from customer funds.
FTX was making several bad business decisions, according to Singh, and he addressed this issue to Bankman-Fried frequently. Alameda allegedly invested $1.5 billion into Bitcoin miner Genesis, $500 million into AI startup Anthropic, and $200 million into incubation firm K5.
Singh admitted that the deal with K5 proposed hundreds of millions of dollars, and he “was worried that giving them this much money would be really toxic to FTX and Alameda culture.” Moreover, Singh claimed that FTX spent $1.1 billion on sponsorships.
Conversations between SBF and Singh weren’t being taken seriously, according to Singh. He claimed that he attempted to cut costs at the company, but SBF was unwilling to cut endorsement and sponsorship deals.
Singh shared that he wanted SBF to “clarify what everyone’s role in this fraud was.” He said, “I wanted Sam to clarify that he was orchestrating it. … I was certainly guilty for participating in it since September, but don’t feel I made the hole.”
On a related note, the trial’s judge, Lewis Kaplan, shut down the defense during cross-examinations and tried to limit sidebars, according to crypto journalist platform Autism Capital.
Paul Grewal, chief legal officer of Coinbase, shared that judges are protective of juror time. He added that jurors “are away from jobs, away from families, and away from all other things that matter to them.”
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