Sam Bankman-Fried will attempt to explain away his role in the spectacular collapse of the multibillion-dollar cryptocurrency empire he once helmed in a federal courtroom on Friday, as he takes the stand in his own defense.
His testimony comes a day later than anticipated, after the judge overseeing the trial unexpectedly sent jurors home on Thursday afternoon in order to determine which parts Bankman-Fried’s testimony he would allow.
Bankman-Fried, 31, is expected share his version of the rise and fall of crypto trading platform FTX, which prosecutors blame on his extravagant spending on investments, donations, and a lavish lifestyle.
Nearly three hours of testimony before judge Lewis Kaplan on Thursday offered a preview of what Bankman-Fried’s testimony will include. He tried to show that the presence of lawyers when he made decisions about how he spent customer money led him to think he was acting legally.
His testimony also suggested that he will attempt to clarify the encryption and data retention practices at FTX, and explain away seemingly spurious movements of money.
On the witness stand Thursday, Bankman-Fried appeared uncomfortable. He winced, stared downward and apologized repeatedly, and often appeared unaware of how his companies were functioning.
The possibility of Bankman-Fried testifying drew large crowds to the lower Manhattan courthouse on Thursday. Those in court included Bankman-Fried’s parents, as well as Michael Lewis, the author who recently published a book on Bankman-Fried. Three overflow rooms contained dozens of crypto enthusiasts and spectators. But the anticipation was swiftly deflated by Kaplan’s surprise change of plans.
Kaplan indicated in Thursday proceedings that the jury may start deliberating on the case early next week, meaning closing arguments could be expected as soon as Monday.
The trial began in early October, and has seen prosecutors put forward multiple witnesses including former members of Bankman-Fried’s inner circle who say they committed crimes at his direction.
The star witness has been Caroline Ellison, Bankman-Fried’s former girlfriend and the CEO of Alameda Research, a hedge fund closely associated with FTX, through which Bankman-Fried allegedly funneled FTX customers’ cash. Ellison testified that Bankman-Fried masterminded billions of dollars in fraud, and that his disheveled boy genius appearance was a carefully curated facade.
Ellison and Gary Wang, a co-founder of FTX, have pleaded guilty in agreements with federal prosecutors to wire, securities and commodities fraud. Like Ellison, Wang testified against Bankman-Fried, saying that his former colleague was not surprised to hear about an $8bn hole in FTX’s balance sheet.
Bankman-Fried has plead not guilty. He was arrested in the Bahamas and extradited to the United States last December, a month after his businesses collapsed.