Sion Davies, 25, died after falling off a balcony at Anthony Munkley's Caia Park estate flat in Wrexham last October.
Footage of the attack was filmed on Mr Davies's phone and played to the jury at Mold Crown Court.
Lee Roberts, 33, and 53-year-old Mr Munkley deny murder.
His wife, Gwenythe Munkley, 55, denies helping her husband evade arrest.
Mr Munkley admitted having a drug problem since the age of 12 and said he was "addicted", but denied owing Mr Davies money.
He said he had been dealing cannabis since February of last year, and his flat came to be known as "The Shop", making around £400 from about 30 customers a week.
Mr Munkley said he had "absolutely nothing" to do with the murder, blaming it on "a Geordie man". He said he left the flat while that man fought Mr Davies.
He told the jury the man was bringing Mr Davies a £20 bag of cannabis.
He said that man wanted to buy a crossbow, and he got one from his bedroom and showed it to him before agreeing a price of £60.
Mr Munkley said he went to the bedroom to get the box for it, and when he returned he heard the twang of the crossbow and saw Mr Davies punch the man in the face.
"I decided to get out of there," he said.
"I just panicked. I did not want my wife coming home to that. I got my dogs and I ran."
The court previously heard the victim was stabbed, shot with a crossbow and pushed, or fell, from three storeys up.
Mr Munkley denied boasting about the attack in calls to witnesses the following day, and said he did not know Mr Davies had been stabbed or slashed and that he had no reason to be hostile towards him.
Andrew Thomas, prosecuting, suggested Mr Munkley had invented "the Geordie man", something the defendant denied.
Mr Thomas said an extensive police investigation had not revealed his existence and Mr Munkley could not give a single clue who he was.
Mr Munkley also denied a suggestion by Mr Thomas he was running out of cannabis and had no money to pay for it.
He denied being scared of rival drug dealers in Wrexham and denied he got himself into debt and had his supplies cut off.
He said he had been awaiting a supply of quality cannabis worth £2,000 from Liverpool the following day, which he intended paying for with money buried in a field at the back of the flats.
The trial continues.
An addict who denies killing a man who was shot with a crossbow has told a court he did not owe the victim drug money.