The U.S. Department of Justice (DOJ) wants the Court to preclude the disgraced FTX founder Sam Bankman-Fried from introducing evidence about the current value of certain investments like artificial intelligence (AI)-focused startup Anthropic.
In an Oct. 8 letter to Judge Lewis Kaplan, the prosecutors said the defense might want to introduce the investment as part of SBF’s efforts to make the exchange’s customer whole. However, they argued that the evidence should be forbidden because Judge Kaplan had previously ruled that “it was immaterial as a matter of law whether the defendant intended to repay the misappropriated funds.”
The prosecutors added:
“Such evidence would therefore be wholly irrelevant, and present a substantial danger of unfair prejudice, confusing the issues, misleading the jury, undue delay, and waste of time. [The] preclusion of this evidence would be consistent with the Court’s prior order granting the Government’s unopposed motion in limine to preclude the defense from making arguments about the amount of assets that have been recovered through FTX’s bankruptcy for purposes of suggesting to the jury that victims will be made whole.”
Similarly, the prosecutors further argued that venture capital investments are unreliable since they are usually highly speculative, citing how FTX secured “venture investments at valuations of around $18 billion in 2021 and around $32 billion in 2022, and yet today its shares are worth nothing.”
Last year, the SBF-led crypto empire invested $500 million in Anthropic. Since then, the company has emerged as one of the main rivals of OpenAI, the developer of the popular ChatGPT chatbot, with its conversational AI assistant Claude.
Recently, the AI company sought to secure $2 billion in funding from various investors, including tech giant Google. This investment can potentially drive the company’s valuation to $30 billion.
The FTX 2.0 Coalition, a group representing FTX creditors, has suggested that this capital infusion could be pivotal in making the beleaguered exchange’s users whole. According to the group, FTX’s stake in this AI company could reach as high as $4.5 billion.
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