The streaky shooter was fined $50,000 by the NBA for "recurring instances of unsportsmanlike conduct" after a string of shoelace incidents.
After Smith was warned by the league for untying the shoelaces of Dallas Mavericks forward Shawn Marion, he then went on to attempt to untie the laces of Detroit Pistons center Greg Monroe during a subsequent game.
In a move likely tied to those incidents, Knicks coach Mike Woodson benched Smith against the Miami Heat on Thursday during New York’s 102-92 win at Madison Square Garden.
"I'm not happy about this because he was warned, he comes back, and he makes the same mistake, and it's not right," Woodson said. "It's just got to stop. I keep saying this every time something pops up, but it's got to stop."
The 28-year-old's future in NYC seems to be up in the air.
"Honestly, I don't even know at this point. At one point I was for sure, and now it's rocking the boat," Smith said. "But it is what it is. It's the nature of the business…If we play hard and we win, I'm happy. If we play hard and lose, I'd have something to say. As long as we keep winning, I'm fine."
Smith's status for Saturday’s game against the Philadelphia 76ers is uncertain. "Honestly, I had no conversations about the situation, so I really don't know what to expect," Smith said.
Smith was the NBA's Sixth Man of the Year last season and signed a three-year, $18 million contract to remain in New York during the offseason.