Former FTX Engineering Director Nishad Singh took the stand today in the ongoing criminal trial of Sam “SBF” Bankman-Fried, the former CEO of cryptocurrency exchange FTX. Singh’s testimony shed light on Bankman-Fried’s unilateral decision-making when it came to purchases through Alameda Research, a firm closely associated with FTX.
SBF’s dominance at Alameda Research
In his testimony, Singh revealed that while individuals like Caroline Ellison and Sam Trabucco may have led Alameda Research, Sam Bankman-Fried was ultimately the one in charge. Singh alleged that Bankman-Fried had a habit of independently making financial decisions on behalf of Alameda Research, even though he was supposedly separated from FTX. Singh stated that Bankman-Fried would unilaterally spend Alameda’s funds without consulting the team, and he even went as far as threatening to fire Caroline Ellison for opposing his actions.
“I learned of spending [at Alameda] after the fact,” Singh testified.
“I’d complain about the excess and flashiness which I found different than what we were building the company for. [SBF would] say I didn’t understand, he was out there interacting with people. I thought we were fleeced for $20 million; he said I was sowing doubt.”
Growing distrust
Nishad Singh further described his growing distrust of Sam Bankman-Fried, portraying him as a formidable character who operated with significant autonomy. Singh cited specific investments in Anthropic, an artificial intelligence startup, and K5 Global, an investment firm linked to prominent figures such as former United States Secretary of State Hillary Clinton and Hollywood celebrities.
According to Singh, Bankman-Fried instructed him and former Chief Technology Officer Gary Wang to proceed with a $1-billion investment in K5 Global, co-owned by Michael Kives and Bryan Baum’s venture capital firm. Singh expressed his concerns about using FTX’s funds for this investment, insisting that it should be done with Sam’s personal funds rather than those of the exchange.
FTX legal woes
Nishad Singh’s testimony came on the ninth day of Sam Bankman-Fried’s criminal trial, which commenced on October 3, 2023. The jury had previously heard from Caroline Ellison and Gary Wang, who both pleaded guilty to fraud charges related to the unauthorized use of FTX funds for investments.
Former FTX Digital Markets co-CEO Ryan Salame, another individual who pleaded guilty to similar charges, is not expected to testify in the trial. It remains uncertain whether the defense team intends to call Sam Bankman-Fried to the stand.
Prior to Singh’s testimony, the prosecution called upon FTX user Tareq Morad to provide insights into the exchange’s operations. Morad shared his understanding of how FTX planned to utilize user deposits and how Bankman-Fried’s influence played a role in his investment decisions. Morad’s testimony touched upon his belief that, amidst reports of withdrawal issues at FTX in November 2022, Bankman-Fried’s tweet asserting the safety of users’ assets reassured him.
Trial outlook
Sam Bankman-Fried’s criminal trial is expected to continue through November, with additional legal proceedings slated for March 2024. Bankman-Fried has pleaded not guilty to all 12 counts of his indictment.
Throughout the trial, Caroline Ellison, Gary Wang, and Nishad Singh have all admitted to participating in unlawful activities alongside Sam Bankman-Fried. Ellison confessed to providing fraudulent documents and making misleading statements regarding Alameda’s use of FTX funds, while Wang asserted that those in charge permitted Alameda to withdraw unlimited funds.
