9 ms·
Sam Bankman-Fried vs. the Match King
- PaulHoule 4y agoThis is is a good case study in fraud that reveals the temporal structure https://pacfe.org/images/meeting/100914/the_crazy_eddie_fraud_by_sam_e__antar.pdf https://pacfe.org/images/meeting/100914/the_crazy_eddie_frau... Like a lot of frauds, the ‘crazy Eddie’ fraud is periodized into phases were first they tried to understate income (to avoid taxes) and then later overstate income (to increase the value of a public company) and then had to work harder and harder to hide the fraud until…
- samstave 4y agoBased on what I have read, I think Fried should be in prison... but I wouldnt be surprised some of the many he robbed arent trying to find him and take revenge...
- ahMath8 4y agoI would also nominate financiers who enable him and the other mind games being played on society. Empowering people good with math is not much different than empowering people good with religious screed. They’re still fallible meat bags. We keep buying into ephemeral gibberish. When one of these smart people can themselves rewrite immutable laws of reality and literally move planet, I’ll be impressed. Reading a machines manual and making it do is not that impressive.
- mistermann 4y agoFrom what little I've read on the matter, SBF is very well connected politically, I'll be surprised if he doesn't get a sweetheart deal.
- dragontamer 4y agoThe opposite. Someone like SBF is a "trusted" figure, and he just destroyed that trust between himself and all sorts of people. Everyone looks like a fool for touching SBF now, and they are going to be pissed. Sequoia Capital is already erasing SBF from their webpage for example.
- ldjkfkdsjnv 4y agoI doubt they will be pissed. They will move on and keep investing, another SBF look alike will come along. Its too profitable.
- samstave 4y ago
- bogomipz 4y agoWhat exactly are the WEF and Satan Space Man Schwab?
- samstave 4y ago[flagged]
- samstave 4y agoI told you exactly what you wanted to know and only gave you literal WEF sources. Watch the video.
- samstave 4y agohttps://old.reddit.com/r/conspiracy/comments/yudy74/world_economic_forum_partnered_with_ftx_to/ https://old.reddit.com/r/conspiracy/comments/yudy74/world_ec...
- jjeaff 4y agoHe has made huge political donations with the money he stole. But I don't think even that will protect him. He stole money from the wealthy and if there is anything that the American justice system does well, it is methodically going after and grinding to dust anyone who steals from the wealthy ruling class. Be it a Walmart shoplifter who stole hundreds, or a crypto scammer who stole billions. And I think the political donations will actually have almost no beneficial impact now. Because he is going to be broke. They already have his donations and he is now tainted and likely broke going forward, so they have no reason to be loyal.
- itronitron 4y agolet's not bicker and argue about who defrauded who... /s
- jahewson 4y agoThe US is not some third world country.
- mistermann 4y agoSure, but that does not mean that the justice system is necessarily just in all cases. Consider the 2008 financial crisis, the punishment (or lack of) that was doled out, and all of the stories that human beings told to each other during that period. Humans run on stories, and good storytellers who know how to wash each others backs rise to the top of the food chain.
- polio 4y agoThat just increases the motivation of extrajudicial actors.
- Cymrukicks 4y agoPeople will keep focusing on the individual here but surely they should be questioning the system? In particular the VC's as most of this was actually institutional money. How on earth did he get £16Billion? Well turns out he went to Stanford same class as Theranos and his Girlfriend whom he made head of the trading arm also went there. She's the daughter of an MIT Econ Professor. It's quite clear FTX only got started because of political connections and back door deals. Sadly this won't be the wake up call that we need to bring back some sort of meritocracy to American society.
- waihtis 4y agoSon of influential political fundraisers, surely fundraising is in the genes for this guy. (partial /s)
- tbrownaw 4y agoIt's a long and time-honored tradition to teach the kids the family trade.
- dragontamer 4y ago> Sadly this won't be the wake up call that we need to bring back some sort of meritocracy to American society. People "investing" into a cryptocoin because "value goes up" weren't being part of a meritocracy what so ever. There was never any true value to FTT. Hell, there's barely any value to BTC or ETH as it is and its been 14 years of looking for a valid use case. The little value it has is in black market, and perpetuating fraudsters like SBF. Sitting around with $100,000, doing nothing, and hoping to get $200,000 or more later isn't really a meritocracy at all.
- itsoktocry 4y agoWhat about all of the other number-goes-up (until recently) companies? Crypto isn't the only one, lots of easy-money beneficiaries will come unglued.
- 4y ago
- zozbot234 4y agoLook, I don't get why we're still talking about this. There's no new information and it's just boring. HN is supposed to be about true intellectual curiosity, not just gawking at the latest dumpster fire.
- dragontamer 4y agoBecause crypto.com is melting down right now, and people want to understand why. We have to go back to SBF from last week to understand the fear that is seeping in over crypto.com.
- 6d6b73 4y agoCrypto is melting because it's a scam. Simple
- zeroclip 4y agoCrypto prices are tanking with this news but DeFi and the blockchain is doing fine. Uniswap and Aave still processing user funds securely.
- 6d6b73 4y agoWe'll talk in a few weeks ok?
- rideontime 4y agoThe price can go to zero and people like this will still boast about the blockchain continuing to function. They're two different discussion topics: does the technology work, and is it actually worth anything?
- zeroclip 4y agoThe price can go very low and stable coins and DeFi protocols around those can still function exactly as they ever have. A well regulated stable coin will function like any other financial service the West is used to.
- lordnacho 4y agoSounds like this is really an argument for transparency. If people could see what what going on with Krueger or SBF's shops, they wouldn't have invested in them.
- dragontamer 4y agoThe main problem is that transparency has been possible all along. All those investors _CHOSE_ to invest into opaque structures, rather than companies with open books / transparency. Because people get wrapped up into cults of personality. And Silicon Valley has mastered the art of reality-distortion-fields.
- akudha 4y agoHow do these magazines write glowing reviews of people like this Sam kid? I understand it is hard to do due diligence on entities that are purposefully opaque etc. But shouldn't these magazines question everything, isn't that the very definition of a journalist's job, before writing reviews (good or bad)? They did the same thing with Holmes. And many more examples. Or do they just do some light work, like a 12 year old school boy does for his class presentation at the last minute, and turn in their stories and move on to the next story?
- tomdell 4y agoA lot of tech coverage is just fawning hagiography rather than societally useful critical journalism, and a lot of people involved in tech seem to prefer it that way judging by their public words and actions - "don't question me - I'm changing the world!" The decline in ad revenues for papers and lack of employment opportunities for serious journalists doesn't help.
- zwkrt 4y agoThere was a headline that made it to the top of HN just last week criticizing the fact that the NYT takes an overly critical viewpoint on tech. Most commenters seemed to agree. I’m not overly surprised, your take is the correct one: “how could you be critical, I’m providing so much value!”
- a_puppy 4y agoThe allegations against NYT are quite a bit worse than you're making them sound. Here are the original allegations: > a few years ago the New York Times made a weird editorial decision with its tech coverage. Instead of covering the industry with a business press lens or a consumer lens they started covering it with a very tough investigative lens — highly oppositional at all times and occasionally unfair. Almost never curious about technology or in awe of progress and potential. This was a very deliberate top-down decision. They decided tech was a major power center that needed scrutiny and needed to be taken down a peg, and this style of coverage became very widespread and prominent in the industry. (https://web.archive.org/web/20221103220819/https://twitter.com/mattyglesias/status/1588190763413868553 https://web.archive.org/web/20221103220819/https://twitter.c...) > People might think Matt is overstating this but I literally heard it from NYT reporters at the time. There was a top-down decision that tech could not be covered positively, even when there was a true, newsworthy and positive story. I'd never heard anything like it. (https://twitter.com/KelseyTuoc/status/1588231892792328192 https://twitter.com/KelseyTuoc/status/1588231892792328192) Fawning hagiographies are one extreme of a spectrum. A top-down decision banning _any_ positive coverage is the opposite extreme. What journalists should do is look at the facts and then decide the tone of coverage, which will result in a mix of positive and negative coverage.
- csours 4y agoIrrational optimism can mean different things (not limited to the choices below) - 1. You have decided to reject rational criticism in favor of cynically taking apparent gains. 2. Your mind has a reduced capacity for rational criticism because of the euphoria of a situation. I think it's pretty hard to say what's happening in the moment, and after the fact it will always look like #1 to the general public.
- perihelions 4y agoThe "Match King" guy also invented several financial concepts still in use today, like Class B shares: https://en.wikipedia.org/wiki/Ivar_Kreuger#Financial_innovations_and_financial_engineering https://en.wikipedia.org/wiki/Ivar_Kreuger#Financial_innovat... ("Financial innovations and financial engineering")
- SilasX 4y agoHaving thought of shares with different voting power is all it takes to count as financial innovation?
- tedunangst 4y agoIt's a very different capital structure, so uh, yeah.
- admax88qqq 4y agoSeems pretty innovative
- nemo44x 4y agoIt’s only obvious to you because it exists. Someone had to invent the novel concept. Often the simplest innovations are not obvious until they exist and they’re often the most powerful.
- SilasX 4y agoDifferent voting weights have existed throughout history.
- textech 4y agoSo-called smart money strikes again. Thernaos, Nikola, WeWork and now FTX (I'm sure I'm missing many and there are some other less obvious ones like Carvana and Opendoor). Billions and billions of dollars were funneled into these obvious scams all while being cheered on by celebrity hedge funders (likes of Cramer, Mr. Clown...etc.) and yet there are zero consequences for anyone involved.
- _2d30 4y agoTheranos and Nikola were all dumb money. WeWork is a real business. Over inflated initially but it's still alive and delivers a good product. FTX was smart money and a huge scam. Definitely a major indictment of the VC industry and major tech capital allocators over the last 2-3yrs.
- mikeg8 4y agoHolmes Will probably be in jail shortly, Milton was convicted of fraud last month and should be sentenced soon, SBF fallout is too new. There will be some consequences although maybe not equal to the fraud. Frauds looks so obvious in hind sight but not so in the moments.
- kyleblarson 4y agoSBF also the second largest donor to the US Dem party after Soros, nothing to see here. https://fortune.com/2022/11/10/sam-bankman-fried-ftx-joe-biden-democratic-party-second-biggest-donor/ https://fortune.com/2022/11/10/sam-bankman-fried-ftx-joe-bid...
- gurjeet 4y agoFrom TFA: Many frauds start out as a legitimate business or idea that simply gets taken too far through some combination of greed, loose morals, and overconfidence. Once the ball gets rolling, money begins pouring in, and a certain amount of power is obtained it becomes difficult to stop the train. People will do just about anything they can to ensure the money and power continue indefinitely. This is at the root of many frauds I've seen in recent decades. In other words, most of these frauds are actually Crimes of Opportunity. https://en.wikipedia.org/wiki/Crime_of_opportunity https://en.wikipedia.org/wiki/Crime_of_opportunity
- mjmsmith 4y ago"H'wood FTX Frenzy as Michael Lewis Reveals He Spent 6 Months with Founder" https://theankler.com/p/hwood-ftx-frenzy-as-michael-lewis https://theankler.com/p/hwood-ftx-frenzy-as-michael-lewis
- deleted 4y ago[deleted]
- locallost 4y ago> One of his closest colleagues said, “There was an odd air of greatness about Ivar. I think he could get people to do anything. They fell for him, they couldn’t resist his peculiar charm and magnetism.” > Which brings us to Sam Bankman Fried Sounds actually a lot more like Elon Musk. But I get the comparison - public companies are a lot more regulated and in the open now than back then so it's not a good place for this kind of fraud. Crypto on the other hand is.
- udkl 4y agoInsightful quotes from the article I annotated to my hypothes.is : > People will do just about anything they can to ensure the money and power continue indefinitely. > When technology moves forward by leaps and bounds, as it did in the first part of the 20th century, people prefer betting on the future more than betting on the past. From comments on this thread : > Us plebeians get a rare view into how business success commonly happens (a network of people force it to happen).