“A lot of people were hurt.”

Defense attorneys representing Sam “SBF” Bankman-Fried have questioned the former FTX CEO for the first time in front of a jury as they prepare to rest their case.

According to reports from a New York court on October 27, Bankman-Fried denied defrauding FTX customers and taking their money while running the crypto exchange. The former CEO reportedly knew nothing about digital assets when he launched crypto hedge fund Alameda Research.

“FTX has declared bankruptcy. A lot of people have been hurt,” SBF said in response to a question from attorney Mark Cohen.

Cohen asked SBF about Alameda's activity in Hong Kong, asking how the risk to FTX might affect the hedge fund. At the center of the lawsuit against Bankman-Fried, Alameda led the efforts of FTX to misappropriate customer funds. He is currently facing seven criminal charges.

SBF thinks he can deploy the same tactics he used with reporters on the trip: answering a slightly different question than he asked, or throwing in a word salad and hoping no one sees it. Judge Kaplan and prosecutors have not.

— Tiffany Fong (@TiffanyFong_) October 26, 2023

“Alameda was a market innovator. [for FTX]” said Banman-Fried, according to reports from the court. “If an account goes negative, we'll start selling, but if it's too late, we've got a backlog.”

The SBF added, regarding prosecutors' objections:

“We have increased the number of servers for the crash engine. But we learned if Alameda or another large account had a wrongful discharge. […] It's terrible for FTX.

According to Bankman-Fried, he told former FTX chief technology officer Gary Wang to “stop such leaks of the Alameda account,” and Wang implemented the “allow negative” feature without SBF's prior knowledge. Wang testified on Oct. 6 that Bankman-Fried ordered him and former FTX engineering director Nishad Singh to implement the feature in 2019.

At the time of publication, Banman-Fried had not yet been cross-examined by the US government for his testimony before the jury. SBF testified in front of prosecutors and defense attorneys on Oct. 26 without a jury present, Judge Louis Kaplan said.

RELATED: Sam Bankman-Fried has no way to ‘outfox' prosecutors: Scaramucci

Before Oct. 25, Banman-Fried was unsure whether he would testify at the criminal trial. As prosecutors prepare to wrap up their cross-examination of the final witness in their case, defense attorneys told Kaplan they are preparing to call a handful of witnesses, including SBF.

The trial is expected to wrap up in a few business days, with prosecutors and defense attorneys presenting closing arguments to the jury. Banman-Fried is scheduled to face five additional criminal charges in a second trial, expected to begin in March 2024. He pleaded not guilty to both charges.

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