In a significant turn of events, Sam Bankman-Fried, the crypto entrepreneur facing multiple fraud charges linked to the downfall of FTX and Alameda Research, has decided to testify in his own defense during the ongoing trial. This decision comes in response to a barrage of damaging allegations from former associates who portrayed him as the mastermind behind a long-running fraudulent scheme.
Bankman-Fried’s legal team announced during a conference call with the judge that their client would testify after the prosecution completes its case. The 31-year-old entrepreneur is potentially facing decades in prison due to allegations that he directed the transfer of FTX customer funds into Alameda Research, an affiliated hedge fund, for speculative investments, political contributions, and extravagant real estate purchases. This financial maneuver eventually led to the bankruptcy of both companies last year.
Typically, defendants avoid testifying due to the potential risks involved. However, Bankman-Fried’s decision to testify could be seen as one of his final defense options after weeks of damaging testimonies from former members of his inner circle.
Three of Bankman-Fried’s closest confidantes, including Alameda Chief Executive Officer Caroline Ellison, FTX’s former head of engineering Nishad Singh, and Gary Wang, a co-founder of the crypto exchange, have already pleaded guilty to fraud and cooperated with prosecutors. During their testimonies, all three individuals pointed to Bankman-Fried as the one orchestrating the misuse of customer funds.
The prosecution revealed that they plan to call one more witness, an FBI agent, on Thursday morning. This agent will provide insights into deleted chats relevant to the case.
Bankman-Fried’s legal team intends to call three witnesses before their client takes the stand. These witnesses include Joseph Pimbley, a financial expert, who will provide insights into Alameda’s line of credit and FTX’s spot margin program.
Closing arguments are expected to take place early next week, with the jury beginning deliberations shortly thereafter.
Bankman-Fried’s testimony will offer the public a chance to hear his perspective in greater detail, as he has largely refrained from speaking about the case due to a gag order issued in July. This order restricted his interactions with the media. Additionally, he spent time in jail following the revocation of his bail due to allegations of witness tampering.
The damaging testimonies from his former colleagues appear to have left Bankman-Fried with few alternatives but to take the stand and present his own account of events. The allegations against him include directing individuals to commit crimes, falsifying financial records, and facilitating the transfer of customer funds between Alameda and FTX. As the trial unfolds, the cryptocurrency community and the public await the outcome with keen interest.