Former FTX Exec Nishad Singh Details Confrontation With Sam Bankman-Fried Over Millions In Spending
Nishad Singh on Monday testified about the extravagant expenditures he observed while working alongside FTX founder Sam Bankman-Fried, voicing his concerns over what he perceived as a wasteful $20 million spending, which Bankman-Fried countered by accusing Singh of sowing doubts.
This ongoing dispute between industry figures comes just ahead of Benzinga's Future of Digital Assets conference on Nov. 14, where such matters regarding the future direction and ethos of the crypto industry will be highlighted.
Testimony On SBF's Spending: During the testimony, Singh described an investment in Genesis Digital Assets, a crypto mining initiative in Kazakhstan.
Singh also touched upon an investment in Anthropic, an AI company with a focus on AI safety.
The almost $500-million investment was facilitated through Alameda Research, he testified.
The discussion took a turn when Singh mentioned a post-Super Bowl party hosted by Michael Kives that was attended by notable figures including Hillary Clinton, Orlando Bloom, Kate Hudson and Leonardo DiCaprio, among others.
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Singh continued by expressing his concern over a term sheet sent by Bankman-Fried proposing millions in bonuses to Kives and Bryan Baum, as well as a billion-dollar investment in their VC firm.
The proceedings also covered lavish real estate purchases, with Singh singling out a Bahamas penthouse valued at $30 million.
He confessed his reservations to Bankman-Fried regarding the opulence of the property, to which the latter responded that he'd spend $100 million to "make the drama go away."
Singh On 'Allow Negative' Feature: Singh's testimony took another significant turn when he recalled an algorithmic failure in LUNA (CRYPTO: LUNA) and UST (CRYPTO: USTC) in May 2022 that led to discussions on acquiring substantial sources of capital.
He also mentioned a conversation with Ramnik Arora, who collaborated with Bankman-Fried on venture capital initiatives.
A particularly alarming revelation was the discovery of an $8-billion accounting error at FTX, which Singh attributed to a bug.
He further revealed the existence of the "Allow Negative" feature, which permitted negative balances.
When Singh noticed a $2.8-billion negative in Alameda's account in June 2022, he said he found it deeply concerning.
The hearing continued with discussions on the appropriateness of using customer funds, where Singh firmly stated it was inappropriate, despite objections from Bankman-Fried's legal counsel.
The case continues to unravel, shedding light on the intricate and often opaque world of cryptocurrency trading and investments.
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