Will Sam Bankman-Fried take the witness stand? It would be dangerous — but he has little to lose.

• Sam Bankman-Fried needs to decide soon whether he'll take the witness stand in his criminal trial.
• The case is going badly for SBF, so he may think he has little to lose.
• If the judge thinks he's lying under oath, he could get an even harsher sentence.

Prosecutors are nearly done walloping Sam Bankman-Fried in court.

They're scheduled to bring just one or two more witnesses in the case, which is playing out in a federal courtroom in downtown Manhattan.

Defense attorneys have said they may not present any witnesses at all. But if they do, there's a good chance Bankman-Fried himself will take the witness stand.

"We are still working through whether we are going to put a case on and, if so, of what nature," Bankman-Fried's lawyer Mark Cohen told US District Judge Lewis Kaplan, who's overseeing the trial, earlier this week.

If they do present a defense case, Cohen said later, they'll tell prosecutors before court resumes on Thursday after a break in the trial, and take about a week to present evidence to jurors.

Ever since his cryptocurrency exchange, FTX, collapsed last November — and billions of dollars of customer deposits seemed to evaporate in connection with his crypto trading firm, Alameda Research — Bankman-Fried has been trying to tell his own version of the story.

He's given numerous interviews with journalists, tweeted that FTX was solvent, spoken at a conference, and wrote a Substack post in his defense.

According to prosecutors — and Bankman-Fried's friends and former employees who testified at his trial — there's a very clear explanation for how $8 billion disappeared from FTX customer accounts: They all took the money for themselves.

Now, faced with the prospect of a century-long sentence, Bankman-Fried has to decide whether he'll take an oath and tell that story to jurors.

Bankman-Fried has little to lose

Defendants have a presumption of innocence, and can win at trial as long as at least one juror says they have reasonable doubt of their guilt during deliberations. But things are looking bad for Bankman-Fried.

Former Alameda Research CEO Caroline Ellison, and former FTX executives Gary Wang and Nashad Singh all pleaded guilty to conspiracy and fraud charges. They testified that they conspired with Bankman-Fried to siphon money from FTX customers.

The money, they said, pointing to internal records on the witness stand, was spent on crypto bets, investments, expensive advertising, and loans to themselves.

If Bankman-Fried believes he's doomed no matter what, he may decide he has little to lose by testifying, according to Sarah Krissoff, a former federal prosecutor in New York.

He may at least be able to elicit a little sympathy from jurors, she said.

"If a conviction seems almost inevitable based on what's presented in the courtroom so far, he has probably not that much to lose by testifying," said Krissoff, now a defense attorney at Cozen O'Connor. "Because it does humanize him in a way to the jury that can be very effective."

One of the biggest challenges for Bankman-Fried's defense team is that they might not have anyone else.

Kaplan refused to allow them to have their pick of expert witnesses testify. Court filings indicate they planned to suggest the norms of cryptocurrency exchanges — particularly those operating outside of the US, as FTX was — may allow for the use of customer funds.

Without those expert witnesses, Bankman-Fried's defense team has little scaffolding to support the closing arguments they'll present to jurors, according to Paul Tuchmann, an attorney at Wiggin and Dana, and a former federal prosecutor in New York.

"It's important for a number of reasons to have those witnesses, both because it gives the jury something to chew on, something to hang their hat on, and then by extension something for the defense to kind of point to in their closing arguments," Tuchmann said.

Prosecutors may have been preparing for SBF to testify

Prosecutors have spent a lot of time showing spreadsheets that demonstrate the behind-the-scenes financial relationship between FTX and Alameda Research.

But messages that directly point to how much Bankman-Fried knew — and when he knew it — are a little harder to come by.

Bankman-Fried did much of his communicating on Signal, a messaging app. He told employees to use its auto-deletion features, according to witnesses who testified in the trial.

"There wasn't much benefit to keeping messages around, and if regulators found something they didn't like in those messages, that could be bad for the company," developer Adam Yedidia testified, explaining Bankman-Fried's reasoning.

Much of the communication records shown at trial come from November 2022, when FTX was collapsing and those auto-deletion features were turned off, and in a smattering of screenshots taken by his colleagues.

For that reason, the case against Bankman-Fried rests on the credibility of his alleged co-conspirators.

In cross-examining Ellison, Wang, and Singh, his defense attorneys have suggested that they're implicating Bankman-Fried only to seek a lighter prison sentence themselves.

"At least theoretically, the question isn't so much necessarily, 'Is all of that wrong?' or 'Is that stuff that they walk through in the spreadsheet criminal?'" Tuchmann told Insider. "It's 'Did SBF know about it? Did he direct them to do it?'"

In their own questioning of the cooperating witnesses, prosecutors have encouraged them to be open about taking responsibility for their crimes. Wang forthrightly said that what he did was wrong. Ellison teared up on the witness stand when talking about the weight of her guilt. Singh talked about how he became "suicidal" with the pressure of knowing he took money from customers and covering it up.

Prosecutors have also taken pains to suggest that Bankman-Fried is a serial liar. They pointed to his tweets around the time of the FTX collapse when he falsely said the company had enough liquidity to cover customer withdrawals. And, according to Ellison, Bankman-Fried's unkempt hair and reputation for slovenliness was only a matter of public relations. She testified that he had a luxury car before getting a Toyota Corolla because "he thought it was better for his image."

On the witness stand, Ellison said Bankman-Fried told her that, under the effective altruism philosophy he subscribed to, it was OK to be dishonest because "rules like don't lie or don't steal" don't "fit into that framework."

"He said that he was a utilitarian, and he believed that the ways that people tried to justify rules like don't lie and don't steal within utilitarianism didn't work, and he thought that the only moral rule that mattered was doing whatever would maximize utility," Ellison said.

Prosecutors — and the judge — can use SBF's media interviews against him

Because prosecutors have the burden of proof in criminal cases, they often tell defendants not to testify. All they technically need to do is undercut the prosecution, not make any kind of affirmative defense.

The decision, however, is ultimately up to the defendant himself. And Bankman-Fried's earlier interviews complicate things.

"I had the sort of fortunate or unfortunate experience of having a lot of defendants testify. And there's a type," Krissoff told Insider. "In my view, there's often certain categories of defendants that like to testify. And in a white-collar case — particularly when the person's veracity is what's at issue — it's not uncommon for the defendant to want to testify and in fact do it."

If Bankman-Fried takes the stand, he'll be cross-examined by prosecutors. And those prosecutors have plenty of material to try to catch him in a lie. He's testified before Congress and given numerous interviews.

In court on Thursday, prosecutors pulled up a video of an interview Bankman-Fried gave to ABC News in December, days before he was extradited, where he squirmed when asked direct questions about what he knew and when.

He hesitated and hedged extensively, saying he was only "vaguely aware" that FTX deposits were being funneled to Alameda. 

Ten months later, that wouldn't seem to be the case, according to testimony given by his former executives who have testified against him. If Bankman-Fried takes the stand, prosecutors will almost certainly point to more material and catch him in any contradictions.

"It's particularly complicated for him because of how much he's talked before," Krissoff said. "So he's going to have to weave a story together that both takes into account all of the evidence that's presented in the government's weeks of presentation and also all of the statements he made before."

The even bigger issue for Bankman-Fried could be Kaplan's future sentencing, if he's found guilty.

In court proceedings, Kaplan has shown little sympathy for Bankman-Fried. Over the summer, he jailed Bankman-Fried, finding that he tried to tamper with two witnesses ahead of trial and repeatedly violated the terms of his home confinement. And that was after expressing exasperation in several earlier hearings that prosecutors didn't seek more stringent restrictions in the first place.

If Kaplan finds that, on top of everything, Bankman-Fried lied on the witness stand, he could issue a much tougher sentence — not to mention add complications to a second criminal trial on campaign finance charges, scheduled for next year.

"He may make the calculation of, 'You know what, if I get convicted, Judge Kaplan's going to sentence me into next century anyway, so I might as well testify in an effort of avoiding that,'" Tuchmann told Insider. "But that's risky because maybe that's not what Judge Kaplan would do. But if he sees SBF testify on the stand then in a way that he believes is untruthful, then maybe he would tack on additional time."