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What is striking about the Sam Bankman-Fried case is that for a long time he was considered to be one of the few who really knew what he was doing and also an a

What is striking about the Sam Bankman-Fried case is that for a long time he was considered to be one of the few who really knew what he was doing and also an advocate for more regulation. It appears to have been a smoke screen, given the financial fragility of his multiple companies, he could not have been looking for more scrutiny and regulation, he was playing Poker with politicians and his competitors. Same with his stance about charity and altruism, all PR, likely nothing in good faith. All of this is not surprising or unusual in business, deception is part of the game, but the part I find disappointing is that almost everyone believed it until it crashed. Why? This is not the first time. Enron, Worldcom, Theranos, Madoff, Nikola, to name a few...

bookofjoe 4y ago
MicroStrategy?
lordnacho 4y ago
Unfortunately I think the biggest red flag is one that doesn't become widely publicized, and I don't know if it happened in this case: a well-respected senior hire comes into the firm and leaves quickly, after discovering the mess. Excuses are made if it does become public, but most people brush it off as not clicking with the culture. Someone I know joined a rather large investment firm and this happened. I only knew about the mess because I'm friends with him, but oh boy it was a mess. Guy moved on, doesn't mention it anymore, but will tell you if you know him. Similar story with a major international bank. Friend goes in, sees a load of bodies (board members doing shady things), leaves. Nothing to report.
- Scoundreller 4y ago
  Or a sudden change of course of the business and simultaneous departures. Obviously not everyone was on-board. When the RIAA went started suing mp3 downloaders, the CEO left for “family reasons”, but a few decades later it came out that they saw downloading music off the internet as their future business model. Napster was a representation of her vision of a virtual jukebox that could play any song ever made. (Can’t remember for the life of me which documentary she was filmed describing that) https://en.m.wikipedia.org/wiki/Hilary_Rosen https://en.m.wikipedia.org/wiki/Hilary_Rosen
- trenchgun 4y ago
  Possibly. https://cryptoslate.com/alameda-research-co-ceo-quits-crypto-in-pursuit-of-happiness/ https://cryptoslate.com/alameda-research-co-ceo-quits-crypto...
  - trenchgun 4y ago
    You were absolutely correct. https://forum.effectivealtruism.org/posts/xafpj3on76uRDoBja/the-ftx-future-fund-team-has-resigned-1?commentId=GoDd83K7ipktDtWWs#GoDd83K7ipktDtWWs https://forum.effectivealtruism.org/posts/xafpj3on76uRDoBja/...
- kjellsbells 4y ago
  Reminds me of the debacle at the NRA, when Oliver North joined and rapidly left. I think we're all still waiting to get to the bottom of that one.
jgalt212 4y ago
> an advocate for more regulation. Perhaps he was envisioning a GFC style bailout in case one of his martingale bets increased beyond the size of M2.
- stephc_int13 4y ago
  He knew that playing friends with people in power was good insurance policy and that he could trick them.
  - Scoundreller 4y ago
    Seems to have worked for him so far. Will be interesting to find out what his personal assets are and how much he gets to keep. If he was smart, he bought everyone in his family a nice house at least a year ago.
    - tartoran 4y ago
      > If he was smart, he bought everyone in his family a nice house at least a year ago. Then not smart enough to realize all that can be clawed back.
      - Scoundreller 4y ago
        Unfortunately, the answer to "will that happen" is "it depends". Lawyers will do very well for a while, I'm sure of that.
- rchaud 4y ago
  He was envisioning getting crypto embedded into portfolios of pension funds and sovereign wealth funds. There's only so much you can steal from the r/bitcoin r/stonks demographics.
memish 4y ago
It's a remarkable veneer. The nepotism and elite corruption is bold faced. SBF's parents are Stanford lawyers who specialize in compliance and ethics. Alameda CEO's dad runs the economics department at MIT, where the current head of the SEC was a professor. "I'm a big advocate for Sam because he has two parents that are compliance lawyers. If there's ever a place I can be where I'm not going to get in trouble, it's gonna be FTX" https://twitter.com/Guruleaks1/status/1591086077489844224 https://twitter.com/Guruleaks1/status/1591086077489844224 FBX's chief lobbyist is a former CFTC commissioner, who is now distancing himself. https://twitter.com/EpsilonTheory/status/1591194581843836928 https://twitter.com/EpsilonTheory/status/1591194581843836928 Senators are still going forward with an SBF-backed bill https://www.theblock.co/post/185746/senators-moving-forward-with-sbf-backed-bill-after-ftx-collapse https://www.theblock.co/post/185746/senators-moving-forward-...
- plumeria 4y ago
  > I'm a big advocate for Sam because he has two parents that are compliance lawyers When authority bias hits too hard.
  - tsol 4y ago
    I mean he was too naive to consider that someone who knows all the rules is automatically gonna be using his knowledge for good.Also, naive enough to trust a kid he didn't raise
- eternalban 4y ago
  I was about to p.s. a comment to same OP to basically say "this is what corruption in high places looks like". The key question to ask here is how is this possible in a nation governed by rule of law? And, what is the impediment that permits this "bold faced" corruption. And finally, what needs to be done to remove this impediment.
jason-phillips 4y ago
> It appears to have been a smoke screen... He was playing poker... This is every small tech company.
TacticalCoder 4y ago
> ... he was playing Poker with politicians and his competitors. With his competitors certainly. And Binance, which may or may not be as corrupt as FTX, called FTX's bluff. If CZ is a scammer too (I don't know about that [1]), he wouldn't go down while handling the market to another scammer. So poker with Binance: I agree. Poker with Coinbase (which I think and hope are legit) too, who patiently waited, with higher fees and way less promises, while the Luna/Terra/BlockFi were offering 8% APY returns "because geniuses". But saying: "playing poker with politicians" while they received $40 m is a very gentle way to put it. He was very likely downright bribing politicians and several people at the SEC and (ex-)CTFC (which a US congressman is saying allegedly happened). These "elites" should be behind bars. That's the real story here. > Why? This is not the first time. > > Enron, Worldcom, Theranos, Madoff, Nikola, to name a few... Exactly. It's not about cryptocurrencies. It's not something Satoshi Nakamoto planned. A thousand years ago these politicians and SEC officials would have been hanged, drawn and quartered for high treason towards the state. Nowadays, because we live in in a modern society were justice reigns, these politicans and SEC officials are going behind bars. Except it's not going to happen. In french there's an old saying: "En prison, en prison pour incompetence". Which means: "In jail, in jail for incompetence". Even if these politicians and officials play the "I didn't know" card, I still think they should be behind bars for their sheer ineptitude. It's an impossible task to be ruled by such dumbasses.
seydor 4y ago
People who have very elitist backgrounds should simply be avoided by savvy investors
stephc_int13 4y ago
Who can believe this narrative? https://twitter.com/The_Prologuist/status/1589678498549207042 https://twitter.com/The_Prologuist/status/158967849854920704...
- huveja 4y ago
  At the very least I see that he can't take care of his body, why then will he be able to take care of mine?
eternalban 4y ago
https://img.nzz.ch/2022/11/10/fe6acded-6a7c-4557-a2ad-cc5be28dfb3c.jpeg https://img.nzz.ch/2022/11/10/fe6acded-6a7c-4557-a2ad-cc5be2... > he was playing Poker with politicians and his competitors .. https://nationalfile.com/wp-content/uploads/2022/11/clinton-epstein-750x375.jpg https://nationalfile.com/wp-content/uploads/2022/11/clinton-... I have a bridge over Dneiper (solid soviet construction) to sell. Wanna buy?
tsol 4y ago
I mean I see these things and I hate it, but damn it worked(for at least a little bit). So long as it works, people will continue these bold faces lies

bookofjoe 4y ago

MicroStrategy?

lordnacho 4y ago

Unfortunately I think the biggest red flag is one that doesn't become widely publicized, and I don't know if it happened in this case: a well-respected senior hire comes into the firm and leaves quickly, after discovering the mess. Excuses are made if it does become public, but most people brush it off as not clicking with the culture. Someone I know joined a rather large investment firm and this happened. I only knew about the mess because I'm friends with him, but oh boy it was a mess. Guy moved on, doesn't mention it anymore, but will tell you if you know him. Similar story with a major international bank. Friend goes in, sees a load of bodies (board members doing shady things), leaves. Nothing to report.

Scoundreller 4y ago
Or a sudden change of course of the business and simultaneous departures. Obviously not everyone was on-board. When the RIAA went started suing mp3 downloaders, the CEO left for “family reasons”, but a few decades later it came out that they saw downloading music off the internet as their future business model. Napster was a representation of her vision of a virtual jukebox that could play any song ever made. (Can’t remember for the life of me which documentary she was filmed describing that) https://en.m.wikipedia.org/wiki/Hilary_Rosen https://en.m.wikipedia.org/wiki/Hilary_Rosen
trenchgun 4y ago
Possibly. https://cryptoslate.com/alameda-research-co-ceo-quits-crypto-in-pursuit-of-happiness/ https://cryptoslate.com/alameda-research-co-ceo-quits-crypto...
- trenchgun 4y ago
  You were absolutely correct. https://forum.effectivealtruism.org/posts/xafpj3on76uRDoBja/the-ftx-future-fund-team-has-resigned-1?commentId=GoDd83K7ipktDtWWs#GoDd83K7ipktDtWWs https://forum.effectivealtruism.org/posts/xafpj3on76uRDoBja/...
kjellsbells 4y ago
Reminds me of the debacle at the NRA, when Oliver North joined and rapidly left. I think we're all still waiting to get to the bottom of that one.

jgalt212 4y ago

> an advocate for more regulation. Perhaps he was envisioning a GFC style bailout in case one of his martingale bets increased beyond the size of M2.

stephc_int13 4y ago
He knew that playing friends with people in power was good insurance policy and that he could trick them.
- Scoundreller 4y ago
  Seems to have worked for him so far. Will be interesting to find out what his personal assets are and how much he gets to keep. If he was smart, he bought everyone in his family a nice house at least a year ago.
  - tartoran 4y ago
    > If he was smart, he bought everyone in his family a nice house at least a year ago. Then not smart enough to realize all that can be clawed back.
    - Scoundreller 4y ago
      Unfortunately, the answer to "will that happen" is "it depends". Lawyers will do very well for a while, I'm sure of that.
rchaud 4y ago
He was envisioning getting crypto embedded into portfolios of pension funds and sovereign wealth funds. There's only so much you can steal from the r/bitcoin r/stonks demographics.

memish 4y ago

It's a remarkable veneer. The nepotism and elite corruption is bold faced. SBF's parents are Stanford lawyers who specialize in compliance and ethics. Alameda CEO's dad runs the economics department at MIT, where the current head of the SEC was a professor. "I'm a big advocate for Sam because he has two parents that are compliance lawyers. If there's ever a place I can be where I'm not going to get in trouble, it's gonna be FTX" https://twitter.com/Guruleaks1/status/1591086077489844224 https://twitter.com/Guruleaks1/status/1591086077489844224 FBX's chief lobbyist is a former CFTC commissioner, who is now distancing himself. https://twitter.com/EpsilonTheory/status/1591194581843836928 https://twitter.com/EpsilonTheory/status/1591194581843836928 Senators are still going forward with an SBF-backed bill https://www.theblock.co/post/185746/senators-moving-forward-with-sbf-backed-bill-after-ftx-collapse https://www.theblock.co/post/185746/senators-moving-forward-...

plumeria 4y ago
> I'm a big advocate for Sam because he has two parents that are compliance lawyers When authority bias hits too hard.
- tsol 4y ago
  I mean he was too naive to consider that someone who knows all the rules is automatically gonna be using his knowledge for good.Also, naive enough to trust a kid he didn't raise
eternalban 4y ago
I was about to p.s. a comment to same OP to basically say "this is what corruption in high places looks like". The key question to ask here is how is this possible in a nation governed by rule of law? And, what is the impediment that permits this "bold faced" corruption. And finally, what needs to be done to remove this impediment.

jason-phillips 4y ago

> It appears to have been a smoke screen... He was playing poker... This is every small tech company.

TacticalCoder 4y ago

> ... he was playing Poker with politicians and his competitors. With his competitors certainly. And Binance, which may or may not be as corrupt as FTX, called FTX's bluff. If CZ is a scammer too (I don't know about that [1]), he wouldn't go down while handling the market to another scammer. So poker with Binance: I agree. Poker with Coinbase (which I think and hope are legit) too, who patiently waited, with higher fees and way less promises, while the Luna/Terra/BlockFi were offering 8% APY returns "because geniuses". But saying: "playing poker with politicians" while they received $40 m is a very gentle way to put it. He was very likely downright bribing politicians and several people at the SEC and (ex-)CTFC (which a US congressman is saying allegedly happened). These "elites" should be behind bars. That's the real story here. > Why? This is not the first time. > > Enron, Worldcom, Theranos, Madoff, Nikola, to name a few... Exactly. It's not about cryptocurrencies. It's not something Satoshi Nakamoto planned. A thousand years ago these politicians and SEC officials would have been hanged, drawn and quartered for high treason towards the state. Nowadays, because we live in in a modern society were justice reigns, these politicans and SEC officials are going behind bars. Except it's not going to happen. In french there's an old saying: "En prison, en prison pour incompetence". Which means: "In jail, in jail for incompetence". Even if these politicians and officials play the "I didn't know" card, I still think they should be behind bars for their sheer ineptitude. It's an impossible task to be ruled by such dumbasses.

seydor 4y ago

People who have very elitist backgrounds should simply be avoided by savvy investors

stephc_int13 4y ago

Who can believe this narrative? https://twitter.com/The_Prologuist/status/1589678498549207042 https://twitter.com/The_Prologuist/status/158967849854920704...

huveja 4y ago
At the very least I see that he can't take care of his body, why then will he be able to take care of mine?

eternalban 4y ago

https://img.nzz.ch/2022/11/10/fe6acded-6a7c-4557-a2ad-cc5be28dfb3c.jpeg https://img.nzz.ch/2022/11/10/fe6acded-6a7c-4557-a2ad-cc5be2... > he was playing Poker with politicians and his competitors .. https://nationalfile.com/wp-content/uploads/2022/11/clinton-epstein-750x375.jpg https://nationalfile.com/wp-content/uploads/2022/11/clinton-... I have a bridge over Dneiper (solid soviet construction) to sell. Wanna buy?

tsol 4y ago

I mean I see these things and I hate it, but damn it worked(for at least a little bit). So long as it works, people will continue these bold faces lies