Witnesses speaking out against Sam Bankman-Fried, former CEO of the now-bankrupt crypto exchange FTX, have often punctuated their testimony with come-to-Jesus moments: a discussion on a tennis court, an office confession in Hong Kong, or an emotionally raw conversation over Signal.
On Monday, Nishad Singh, the former of head of engineering at FTX and one of three key lieutenants who took plea deals from the government, sketched out where he was when he finally realized how far FTX had strayed from its seemingly idealistic origins: the balcony of a luxury penthouse in the Bahamas.
Singh’s description of his confrontation with Bankman-Fried, who’s on trial for allegedly hoodwinking FTX customers, investors, and lenders, was some of the most vivid testimony to come from the former executive, after two other key members of FTX’s inner circle—Gary Wang and Caroline Ellison—finished testifying last week.
“I was blindsided and horrified,” Singh said to prosecutor Nicolas Roos, in reference to the penthouse meeting.
‘Turned out to be so evil’
In September 2022, shortly before Bloomberg was set to publish an article digging into the links between Bankman-Fried’s crypto hedge fund Alameda Research and FTX, Bankman-Fried sent a Google Doc over Signal to Singh, Ellison, and Wang to argue why “it might be time for Alameda Research to shut down.” (As part of the document, he drafted a thread for X, then Twitter, to announce the hedge fund’s closing. “We came, we saw, we researched,” was how the former crypto mogul proposed starting off.)
Singh suggested only cutting off Alameda’s relationship with FTX, but Ellison responded over text that that was “impossible.” In a private meeting with her and Wang, one that Singh said Bankman-Fried purposefully avoided, he learned why: Alameda owed $13 billion to FTX, and much of that was customers’ money. “This was absolutely devastating,” he testified on Wednesday.
Shortly afterward, Singh, who said he rarely ever met with Bankman-Fried one-on-one, asked him to talk privately. In the evening, they met up for more than an hour on the balcony of their Bahamas penthouse—where Singh, Bankman-Fried, and eight other FTX and Alameda staffers lived.
Pacing near a circular pool, Singh asked Bankman-Fried, who was sitting on a white chaise lounge chair, if what he had heard from Wang and Ellison was correct. “Well, we are a little short on deliverables,” Bankman-Fried said, referring to liquid funds FTX could use to immediately honor customer withdrawals.
“Jesus effing Christ,” exclaimed Singh.
“Yeah, this has been taxing five to ten percent of my productivity,” the former FTX CEO responded.
Being $13 billion in the hole, Singh said, would affect his own productivity much more than a few percentage points, but Bankman-Fried replied that he wasn’t worried. He said he planned to cut expenses and that the expansion of FTX.US into the futures market would help increase the amount of funds on hand for customers.
Singh, though, was mortified. “I felt really betrayed,” he testified, “that five years of blood, sweat, and tears from me and so many employees, driving towards something that I thought was a beautiful force for good, had turned out to be so evil.”
Update, Oct. 16, 2023: Changed the final quote to accord with what was on the court transcript, which was released later in the evening.
