32 ms·

Sam Bankman-Fried tries to explain himself

370 points by Hippocrates 4y ago

api 4y ago
The overwhelming feeling I get from this interview is one of cynicism and nihilism. In his mind it's okay if he did shady things because everyone else does. Everything is broken, everyone is corrupt, everything is shit, so fuck it... basically. He more or less admits that the effective altruism stuff was a sham.
jl2718 4y ago
He's being honest here, and we should listen to him. Point 1: Most personalities are shams. Ethics/politics among the powerful is a lie/shibboleth. Instinctively you know this to be true, but hope in a great savior is deeply ingrained. Point 2: Regulators make things worse. They are actively working against our interests. He would know best; they created him. Again, we want to believe in the great savior myth, but they are just people: lazy, corruptible, political, etc. Point 3: Chapter 11 made things worse. He's probably right about this too. He's saying that he would have the power to pay back depositors first. Chapter 11 only gives him legal protection, and puts depositors last. They will liquidate everything to USD, pay a 10% commission for a horrible rate, and then pay the lawyers, then the counterparties, then the investors, and then a tiny fraction back to depositors, years down the road. Another MTGOX/BITFINEX. As a reference, the Irving Picard recovered $9.3B from Madoff and paid only $5.4B to depositors. The rest evaporated in liquidation expenses and legal fees of $700M. The legal fees for Lehman Brothers liquidation was $1.6B. The people running the show now are not your great saviors; they are incompetent, greedy, and morally disconnected.
- Denvercoder9 4y ago
  Chapter 11 proceedings will not pay investors before depositors.
  - jl2718 4y ago
    IANAL, but they may have structured their investment as senior debt, and depositors may have some other funny legal status. Also Alameda has to be dissolved before FTX, so technically FTX depositors are a creditor to Alameda while the Alameda investors are depositors, and typically Chapter 11 discharges debts. Also, Alameda is under Bahamian law, and so is FTX, and US courts will only get what's left.
- notch656a 4y ago
  Is this satire? The dude is likely a sociopath who is speaking for whatever he think meets his interests and/or vanity.
  - eternalban 4y ago
    Some words of wisdom from our 43rd: https://www.youtube.com/watch?v=rQ6N-sb7SVQ https://www.youtube.com/watch?v=rQ6N-sb7SVQ
- 55555 4y ago
  > Irving Picard recovered $9.3B from Madoff and paid only $5.4B to depositors. Is this accurate? That's absolutely insane. _That_ sounds like fraud/theft.
  - jl2718 4y ago
    Did you know that Madoff didn't charge fees? His crime was faking the numbers, but the way he made money is, much like SBF, through leverage of managing that money. I don't know much about it, but until the lawyers got involved, the only losses were the made-up gains. Then they took $4B in real money. So, who's the real crook? https://money.cnn.com/2013/05/06/news/companies/madoff-picard-lawyers/index.html https://money.cnn.com/2013/05/06/news/companies/madoff-picar...
- AnimalMuppet 4y ago
  I fail to see how regulators made this worse. I see loud and clear how the absence of regulators made this worse, whatever SBF says.
TrapLord_Rhodo 4y ago
whats funny here is the btc price action. There clearly was some insider trading before all this happened.
blobbers 4y ago
I'm surprised that he doesn't blame Caroline Ellison more for what's going on. She ran the hedge fund, she f'ed up, and when she f'ed up she took funds from FTX. These people are such idiots.
engineer_22 4y ago
The guy's lawyers need to get him to shut up.
- memish 4y ago
  What’s even more remarkable is that his dad is a lawyer and reportedly with him…
- harry8 4y ago
  "You're only making things worse for yourself!" Matthias: "Worse?! How could it get any worse?" --Monty Python's Life of Brian https://montypython.gifglobe.com/scene/?id=2ZrhmRltHUEk https://montypython.gifglobe.com/scene/?id=2ZrhmRltHUEk
- AlexandrB 4y ago
  Seems like he's chosen the path of a real "poster". Trying to "post through it" until things improve or someone finally takes away his phone/computer.
  - pessimizer 4y ago
    Nothing but respect for that position. Never stop posting.
- fisherjeff 4y ago
  Oh my god, I upvoted you before reading the DMs. I... wow, yeah, they need duct tape. EDIT: Okay I just cannot get over this, obviously I'm exaggerating but it's pretty much "I didn't want to do bad stuff because that would be bad, and then after I had personally done all of the bad things, I realized that I had, in fact, done something very bad."
  - yeet_yeet_yeet 4y ago
    Pretty sure he's given up at this point. Nobody would do something this dumb otherwise. And then confirm it the next morning.
flanked-evergl 4y ago
> I feel bad for those who get fucked by it > by this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us Woke washing pays off, that is why everyone does it. But luckily BTC is there to take the blame.
deleted 4y ago
[deleted]
alexb_ 4y ago
SBF is monumentally stupid for sending these messages. Straight up admitting that any "ethics" was for reputation only. And not only that, but saying that the mistake was not doubling down again.
- deleted 4y ago
  [deleted]
- thundergolfer 4y ago
  Yeah after the NYT interview I'm a bit shocked at how bad these messages look. He looks stupid, brazen, delusional, and lacking in compassion. If his texts are normally similar to this, how did anyone serious think this guy was brilliant?
  - fnimick 4y ago
    > how did anyone serious think this guy was brilliant? He made a lot of money by bucking norms. Hacker news of all places should recognize that people are drawn to those who project an appearance of improbable success through skill despite a lack of underlying competence (see also: Elon Musk)
    - deleted 4y ago
      [deleted]
  - s_dev 4y ago
    Maybe I'm out of the loop but I'd never heard of him til the FTX implosion.
    - TremendousJudge 4y ago
      I had, once, in a HN comment a couple of months ago. It said that he was lobbying on some political race, which is something he was doing because he believed in "Effective Altruism". This was presented as a good thing, as though billionaires giving money to politicians was a novel idea. I guess this is the type of person who found him worthy of mention.
tsol 4y ago
The "lament about how corrupt the system is and that we are forced to partake in it" excuse has been popular in recent years, not surprised he's going for it. Let's see how that plays out
r721 4y ago
>Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.
jeffbee 4y ago
Has anyone check on this guy's lawyers? Are they safe?
ZeroGravitas 4y ago
How does this story keep getting worse!? Every time something new comes out.
boeingUH60 4y ago
Jesus Christ…does this guy not know that you should keep quiet when you’re the subject of a criminal investigation from multiple government agencies?
- deleted 4y ago
  [deleted]
- curiousgal 4y ago
  I am 30 years old and I am laughing at anyone who has trusted these kids with anything. His balance sheet shows just how childish and out of depth he and his possie of "execs" are.
  - nabogh 4y ago
    Just looked it up. SBF is 30?
    - twicetwice 4y ago
      Yup, he founded Alameda Research in 2017 at age 25 and FTX in 2019 at 27.
    - FireBeyond 4y ago
      And I believe for the CFO it was her first job after college. And for another linked CEO they'd been a trader for three years, and then were made CEO at Alameda?
- chrchang523 4y ago
  This is further evidence that he was thinking of this in terms of all-or-nothing coin flips. In case you haven't seen it: COWEN: Okay, but let’s say there’s a game: 51 percent, you double the Earth out somewhere else; 49 percent, it all disappears. Would you play that game? And would you keep on playing that, double or nothing? BANKMAN-FRIED: With one caveat. Let me give the caveat first, just to be a party pooper, which is, I’m assuming these are noninteracting universes. Is that right? Because to the extent they’re in the same universe, then maybe duplicating doesn’t actually double the value because maybe they would have colonized the other one anyway, eventually. COWEN: But holding all that constant, you’re actually getting two Earths, but you’re risking a 49 percent chance of it all disappearing. BANKMAN-FRIED: Again, I feel compelled to say caveats here, like, “How do you really know that’s what’s happening?” Blah, blah, blah, whatever. But that aside, take the pure hypothetical. COWEN: Then you keep on playing the game. So, what’s the chance we’re left with anything? Don’t I just St. Petersburg paradox you into nonexistence? BANKMAN-FRIED: Well, not necessarily. Maybe you St. Petersburg paradox into an enormously valuable existence. That’s the other option. https://conversationswithtyler.com/episodes/sam-bankman-fried/ https://conversationswithtyler.com/episodes/sam-bankman-frie... (See the first paragraph of https://www.lesswrong.com/posts/BZ6XaCwN4QGgH9CxF/the-kelly-criterion?commentId=3JEaWCYG2B5ocBJg7 https://www.lesswrong.com/posts/BZ6XaCwN4QGgH9CxF/the-kelly-... for the outline of an explanation of why his reasoning was not applicable to most real-life scenarios. This is pretty subtle; >95% of the explanations on the Internet I've seen over the past week as to why SBF is "obviously wrong" don't actually work.) Maybe I'm speaking too soon, but he does seem ready to accept that he lost this flip. It would obviously be insane to trust with him anything big at this point, but I'm optimistic that he won't fight to the bitter end.
jdm2212 4y ago
This is one of the most amazing things I've ever read. Also, I feel so bad for his lawyers.
gizajob 4y ago
"Fuck regulators (and their gung ho attitude to stopping me defrauding billions from everyone around me whilst high on off-label smart-drugs)"
roywiggins 4y ago
> I was trying to make sense of what, behind the PR and the charitable donations and the lobbying, Bankman-Fried actually believes about what’s right and what’s wrong — and especially the ethics of what he did and the industry he worked in. This seems like a weird thing to worry about right now, I imagine my question would be "hey, where'd all the deposits go?" Like, I'm sure it's all interesting in a psychological and sociological way, but "what does SBF really believe" feels like it should take a back seat to what did he do. That's much more interesting! It's easy for someone like SBF to just say stuff about what's going on in his head, whether it's true or not. But, we're talking about real (and, okay, a lot of fake) money here. There's this weird assumption in a lot of reporting that a rich person must have interesting things to say, or beliefs that are worth getting to the bottom of. Sometimes that's true, but sometimes they're just not very interesting people. Which is fine! Lots of people aren't very interesting, but really rich people get to be treated as interesting even if they're actually boring.
- wging 4y ago
  It makes a lot of sense given the nature of SBF’s charitable donations and the purported rationale(s) behind them. Kelsey Piper is pretty deeply associated with the EA movement, which is heavily interested in picking the right ways to deploy money to solve the world’s problems, and much of SBF’s charitable giving was too.
  - ZeroGravitas 4y ago
    > In 2018, Vox launched Future Perfect, with the goal of covering the most critical issues of the day through the lens of effective altruism. In this talk, Kelsey Piper discusses how the project worked out, her experience as a Vox staff writer, and her thoughts on the key challenges of EA-focused journalism. I just commented in this thread about how this story magically keeps getting worse, and then it got worse...
    - SilasX 4y ago
      Yeah when I saw it was Piper as the journalist, I was expecting to see a massive disclaimer/disclosure on the article. There still isn’t one. My own disclosure: I have many mutual friends with Piper and participate in the local EA group and contribute to EA causes.
Mandatum 4y ago
I think he doesn’t care. He knows he’s not going to do much prison time, and he 1000% has fiat stashed given where he incorporated.
- AlexandrB 4y ago
  You never know. He doesn't seem like a planner based on how the collapse of FTX went down and how he's talking to journalists instead of his lawyer.
reducesuffering 4y ago
He has to still be on methamphetamine-precursors. (Was confirmed in an image on his desk[0]; selegiline) [0] https://milkyeggs.com/?p=175 https://milkyeggs.com/?p=175
- perardi 4y ago
  Sigh. No. https://astralcodexten.substack.com/p/the-psychopharmacology-of-the-ftx https://astralcodexten.substack.com/p/the-psychopharmacology... Selegiline metabolizes to the inactive isomer of meth: l-methamphetamine. Which is very much not trucker crank—it’s an over-the-counter decongestant. Was he on good ol’ non-meth-amphetamine, in the form of Adderall? Sure. But rather a lot of people are on Adderall, and most of them haven’t created a market-shattering boondoggle.
  - reducesuffering 4y ago
    Thanks for the clarification!
throw7 4y ago
cringe who is 'liking' and 'crying' bankman's messages?
- smoldesu 4y ago
  Apparently someone who is great at buttering him up to say more and more stupid stuff.
  - Hippocrates 4y ago
    Exactly.. that is some excellent social engineering/reporting skill.
monero-xmr 4y ago
A programmer who helped create Tornado Cash rots in a Dutch jail cell (not charged, might I add) while SBF, Do Kwan, Elizabeth Holmes, and Trevor Milton still remain free. SBF is actually in a $30 million penthouse playing League of Legends. Clown world
- delusional 4y ago
  I'd rather have an FTX scandal than Tornado Cash. I'd rather someone does some fraud than actual funneling of money to terrorists, druglords, gangs, and other problematic organizations.
  - nailer 4y ago
    Tornado Cash is private banking. The writer of the code did nothing wrong by writing it.
    - leesalminen 4y ago
      Open source code should be considered protected speech. The fact that it’s not should scare the daylights out of any OSS contributor. Also, privacy should be a human right. If you disagree with the above, you might be a fascist.
      - ceejayoz 4y ago
        It's protected speech. What you do with it can be criminal. Code for an Arduino that moves a robotic arm is legal. Using it to pull a trigger and kill someone isn't.
        leesalminen 4y ago
        Of course. Was the tornado cash person arrested for using the code in an illegal way or just for publishing the code?
        4y ago
SevenNation 4y ago
> Bankman-Fried has maintained that FTX has never invested the deposits of crypto account holders on the exchange. I pressed him on that point via Twitter, and while he continued to insist that FTX did not directly use account money in this way, he said that Alameda — which he also owns — had borrowed far more money from FTX’s balance sheet for investments than he had realized, which ultimately left FTX vulnerable to the crypto equivalent of a bank run. > Why didn’t Bankman-Fried realize what was happening until it was too late? “Sometimes life creeps up on you,” he said. This is the central issue of the case. There aren't many paths for an exchange to experience a run unless it's acting like a fractional reserve bank. So here's an admission that Alameda borrowed from the FTX balance sheet. There's also a denial that FTX invested deposits. There's no way for both statements to be true.
- jaywalk 4y ago
  FTX loaned the deposits to Alameda, and Alameda invested them. It's totally different from FTX making the investments themselves! /s
  - sailplease 4y ago
    A loan is an investment.
  - CuriousCosmic 4y ago
    It's somehow even worse given that according to SBF, they didn't even loan all the deposits. Something like $8B of them were being deposited to Alameda directly from users without their knowledge. https://cdn.vox-cdn.com/uploads/chorus_asset/file/24202784/Screen_Shot_2022_11_16_at_7.32.22_AM.png https://cdn.vox-cdn.com/uploads/chorus_asset/file/24202784/S...
cliftonk 4y ago
to be clear: - he lent his own hedge fund $8b collateralized by tokens he controlled issuance of (FTT, SRM, MAPS, OXY). At full size, the liquidation price of these tokens was 0 (he also purchased billions worth of FTT off the market when he could print them himself for free?). - Sensing alameda was insolvent and customer funds were misappropriated, customers withdrew until they ran out of liquidity. - Withdrawals were suspended - Citing Bahamian authorities requests to unfreeze assets of bahamian residents, withdrawals were opened back up for bahamian residents. Hundreds of millions were withdrawn. Bahamian authorities have since made statements that no such requests were made (so this was just insiders stealing even more). - Approx $500m of assets were drained from FTX wallets at the same time as FTX databse records were cleared (obviously not a hack, just insiders stealing even more). - SBF goes on twitter to make new one-letter tweets while simultaneously deleting incriminating tweets so as to not trigger deletion bots picking up that he deleted said tweets. Ongoing theft and destruction of evidence out in the open after stealing 10 billion dollars from over 1 million depositors. SBF has still not been arrested. This all but confirms the wildest of conspiracy theories.
- jeffbee 4y ago
  You kind of went off the rails there in the final sentence. Are you saying that any of this adds credence to the silly idea that Democrats are beholden to SBF campaign money?
  - leesalminen 4y ago
    It’s a silly idea that being the second largest donor to a political party in the US buys you special favors? Why else would anyone give that kind of money to politicians without expecting something in return?
    - harry8 4y ago
      >Why else would anyone give that kind of money to politicians without expecting something in return? There's a polite theory it is done for altruistic reasons to make the country a better place for all and that it is the exercise of free speech and you are also free to give Trump, Biden, Pelosi & McConnell vast amounts of cash. But yes we're all adults here.
wheelerof4te 4y ago
Yes, the game is rigged from the start. But that does not mean you can play innocent when you lose it.
user3939382 4y ago
Anyone with a couple weeks of legal education, never mind the caliber lawyers this guy should be able to afford, would immediately tell him to s t o p t a l k i n g. On a related note: https://youtu.be/d-7o9xYp7eE https://youtu.be/d-7o9xYp7eE
oldgradstudent 4y ago
OMG. "The dog ate my homework" would have been a better excuse. > like, "oh FTX doesn't have a bank account, I guess people can wire to Alameda's to get money on FTX" > ....3 years later... > 'oh fuck it looks like people wired $8b to Alameda and oh god we basically forgot about the stub account that corresponded to that and so it was never delivered to FTX' So they "basically" forgot about $8B not transferred to FTX. But somehow FTX customers saw the funds deposited in their accounts, otherwise they would have complained.
- hef19898 4y ago
  Since more than one thing can be true at the same time, why not a combination of a) total lack of internal controls, understanding of basic accounting and book keeoing, b) total lack of competence when it comes to manage these amounts of money and c) actively defrauding customers by stealing their deposits?
  - oldgradstudent 4y ago
    All of the above. Alameda Research was clearly in the top of the worst hedge funds ever, and clearly they had terrible controls and accounting. However, without (c) you don't get this epic disaster. From SBF's tweets it is clear that they were aware they had to keep customer funds segregated. Remember the time they tried to pretend that USD is protected by the FDIC? https://www.cnbc.com/2022/08/19/crypto-firm-ftx-receives-cease-and-desist-from-fdic-about-insurance.html https://www.cnbc.com/2022/08/19/crypto-firm-ftx-receives-cea... Well, actually it was protected by the FDIC, but not from FTX.
- skybrian 4y ago
  It doesn't make sense and could all be lies, but to try to interpret it: they saw that the money arrived in the "poorly labelled account" and increased the customer's balance. But in some sense, the money never got to FTX and was still with Alameda. Or alternatively, FTX and Alameda commingled funds using the "poorly labelled account" and it was used for whatever payments either company needed to make, like withdrawals. This lack of separation means the balances were never really backed and it was a Ponzi all along.
kranke155 4y ago
SBF, his foundation and his family are well connected politically. NYT already did a bizarro puff piece on him, now Vox does this (which apparently directly received FTX foundation money). It’s absurd as he is essentially a well connected criminal. edit I do want to correct one thing - this is not a puff piece like the NYT one, actually it implicates him.
- vkou 4y ago
  Having two professors as parents isn't exactly 'well connected politically'[1]. Two senators, or two billionaires would be. [1] I can't say I've ever felt that I was well-connected politically...
  - deleted 4y ago
    [deleted]
  - kgwgk 4y ago
    Did your father work with legislators to try to pass laws? “When I went to California to try to fight into it, I thought, ‘Well, there’s only 120 legislators. I’ll talk to them all one on one,'” Bankman said. “I found that in order to do it, I had to hire a lobbyist because I just couldn’t handle the details or get the meetings. In Congress, when I went there, now there’s 500 plus, and what I found everywhere I went is that Intuit had already preceded me. They’d already met every representative I was going to meet.” Did your mother create a political fundraising organization? “In 2018, the secretive Stanford-connected Democratic fundraising group Mind the Gap (MTG) funneled over $20 million toward competitive U.S. House of Representative elections and get-out-the-vote (GOTV) organizations. In 2020, MTG wants to increase that number to $140 million. “MTG is led by Barbara Fried, the William W. and Gertrude H. Saunders Professor of Law; Paul Brest, an emeritus professor of law and director of the Law and Policy Lab; and Graham Gottlieb, a Stanford research affiliate. Of the three, Gottlieb has the most direct policy experience, having formerly served in junior roles in former President Barack Obama’s 2012 reelection campaign and in Obama’s White House.”
    - HideousKojima 4y ago
hahaxdxd123 4y ago
Somewhat unrelated to this article, but could someone clear up a point of confusion for me? There are people blaming the CTFC and Congress and the Democrats that SBF donated to for not regulating this. But was FTX (the Bahamian entity) even under their purview? AFAIK, you weren't even allowed to access FTX from a USA IP address, you had to use a VPN. You could access FTX US which was a different thing and offered a much smaller subset of the products FTX did (and that business seems solvent?) Like what jurisdiction does the USA have over a crypto exchange elsewhere? I know anything that touches a US dollar can be tried in a Manhattan court and maybe he gets convicted of a crime and extradited here. But like Japanese banks touch US dollars as well, but the USA doesn't get to regulate them, right?
- SilasX 4y ago
  FTX US failed too though.
  - AlexandrB 4y ago
    Even though it was supposed to be a completely separate entity (or so we were told). ¯\_(ツ)_/¯
kragen 4y ago
tfw you forget the old friend you're dming on twitter about your life problems is now working as a reporter for vox and is going to post your whole dm thread as an article
- throwaway821909 4y ago
  I'd never heard of the guy until now so maybe it's obvious but you do wonder in these situations, he must have realised that the questions were leading to an article but did he expect the transcript to be published verbatim?
  - kragen 4y ago
    maybe he didn't remember theunitofcaring had become a journalist and thought he could trust her
    - kragen 4y ago
      it turns out my guess above was right: he didn't know she was planning to publish the dm thread https://nitter.net/SBF_FTX/status/1593014934207881218#m https://nitter.net/SBF_FTX/status/1593014934207881218#m > Nov 16 > 25) Last night I talked to a friend of mine. > They published my messages. Those were not intended to be public, but I guess they are now. theunitofcaring responded at https://forum.effectivealtruism.org/posts/vjyWBnCmXjErAN6sZ/kelsey-piper-s-recent-interview-of-sbf?commentId=2PnCgCb7dpfZbZQCe#HjTxn7WFne7vnovNA https://forum.effectivealtruism.org/posts/vjyWBnCmXjErAN6sZ/... journalists are not your friend
deleted 4y ago
[deleted]
- deleted 4y ago
  [deleted]
lordnacho 4y ago
Well there's a sense of contrition there, so that's good. However there's no reasonable excuse. You can't be like "aw man, I wish we'd been more organized". A big piece of this is on the investors. All those depositors would have been saying "Hey Sequoia and OTPP are in there, they must have checked things are sound". Was that foolish of them, to assume reputable investors had done their due diligence? You're between a rock and a hard place when you answer this. Either they should have all done their own DD, basically not invested because who can do DD as a little guy, or large investors are not responsible for what everyone else thinks they did, which is a rather major indictment of how our financial system works. But back to SBF's explanation. It's just juvenile, basically the same as "mommy, you didn't make me clean my room and now I slipped and hurt myself". Whatever the laws are, when someone trusts you with their money, you are responsible for certain basic things like knowing where that money is. All the money in the world and they didn't think to hire an accountant and a risk manager. Or perhaps they did and those people quietly left, we'll never know. About the regulators, it's quite the about-turn. He goes from saying it's a good thing (which was why CZ got pissed at him?) to saying it was just PR, and that regs basically don't work anywhere. I think this is also a juvenile view. You can make the case that it often leads to unintended consequences, and that it often causes problems, but you can't sweep all regulations in all sectors into the bin, there's just too much evidence that it sometimes does work. In fact you could say that the very reinvention of finance as crypto ought to motivate participants to look at what problems were found in the financial world that were addressed by regulation. Glass-Steagal, deposit insurance, central banking, there's a lot to read about.
- throwawaylinux 4y ago
  > Well there's a sense of contrition there, so that's good. Sigh. So this is how confidence men and politicians and scammers can make good livings. He just said that all the good-sounding things he said in the past about ethics and doing the right thing was "this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us".
  - kindatrue 4y ago
    SBF: "I always lie except right now" People: oh wow so true
dibt 4y ago
Did Bernie Madoff make it this easy? Or is this an elaborate plan he's already designed with game theory?
bboylen 4y ago
Not seeing much remorse here, but what can you expect from a guy that gambled with billions of dollars worth of people's savings. Don't buy that he didn't realize what they were doing until it was too late. He admits in this interview to lying about previous public positions, so wouldn't trust anything he says here either. I just hope crypto learns from this and normalizes Proof of Reserves
- yeet_yeet_yeet 4y ago
  What about you just keep custody of your own damn coins? Isn't that the point of cryptocurrency, that it's like cash except you don't have to physically carry it.
- lottin 4y ago
  Proof of reserves only proves (for the sake of the argument let's assume it's an actual proof) the exchange has some amount of reserves, which is mostly meaningless. The quantity of interest is the share of deposits that are backed with reserves, not the absolute amount of reserves.
  - bogomipz 4y ago
    Interesting, is this intentional then? Or is there some other reason why showing the absolute amount of reserves would not be feasible?
    - lottin 4y ago
      I don't know, it looks like a half-baked idea, like everything surrounding crypto-currencies. Someone probably came up with this proof of reserves idea, and everybody else said yeah let's do this, because it sounded like it does what they wanted to do, except it doesn't.
      - RustyRussell 4y ago
        Yeah, the original Proof of Reserves proposals (and this is probably a decade ago, on the bitcointalk forum) was a merkle scheme IIRC in which each user could verify that their amounts were added into the proven total. Most people seem to be just using "prove you hold some amount" which is a very poor cousin. However, it is pretty clear that FTX would have failed even that, so maybe we should lower our expectations?
Barrin92 4y ago
that's one of the wildest things I've ever read. So the guy faces criminal investigations and may owe people billions and he DMs a reporter and tells her literally, "yeah most of the ethics stuff I did was PR"..? I don't pride myself on having a lot of criminal energy or anthing but I don't understand how he even got to this point. Is this his last act of effective altruism for whoever sues him in a court?
NwtnsMthd 4y ago
> ... by this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us Sums up much of the world we live in :/
- teg4n_ 4y ago
  Not really. That’s an incredibly cynical take.
  - deleted 4y ago
    [deleted]
harry8 4y ago
SBF has used at least one cpu attached to a network on the critical path of his actions. Will this be enough to cause people to be stupid enough to let his powerful and connected family and friends get him off light? People in positions of power seem to get awfully stupid when there's a cpu attached to the network on the critical path. Madoff, no cpu on the network on the critical path. All understandable and could have been done the same with paper and a filing cabinet. SBF - so the code actually does (brain shuts down). Interesting to see if this is so extreme people will keep thinking through the part where they want to stop because "computer"
- _dain_ 4y ago
  what
  - harry8 4y ago
    Even just the mere mention of the involvement of a network attched cpu seems to be able to cause the failure of all forms of critical reasoning in many people. See above.
    - _dain_ 4y ago
      i had to re-read what you were saying about 5 times before i understood your point, i honestly thought you were some kind of schizophrenic with the way you phrased it and kept repeating the same awkward term -- edit: I'm rate-limited so I can't respond to your other reply. I'm saying that your comment looks like something a crazy person would write and I had a hard time parsing it. this is like a garden-path sentence: > SBF has used at least one cpu attached to a network on the critical path of his actions. Will this be enough to cause people to be stupid enough to let his powerful and connected family and friends get him off light? People in positions of power seem to get awfully stupid when there's a cpu attached to the network on the critical path. i thought you were making some kind of paranoid implication about the intel management engine or mind control or something. and I replied because I thought you should know that what you wrote wasn't clear on the first, second, third, and fourth readings.
deleted 4y ago
[deleted]
pr337h4m 4y ago
It's surprising that SBF sounds so libertarian suddenly - he was lobbying for government control of crypto just one month ago (which rightfully made him super-unpopular among the OG crypto crowd) https://www.moneyandstate.com/blog/response-to-sbf https://www.moneyandstate.com/blog/response-to-sbf He does sound sincere here - no idea what to make of this.
- pr337h4m 4y ago
  > there are people who know what's that like, and who want to do for someone else what nobody did for them He probably hopes for a bailout from either BitMEX or Bitfinex-Tether and is simply trying to appease them by walking back his pro-government views
expazl 4y ago
It this real? Is he really THAT stupid? His defense against "you took user deposits and gambled the money" is "No, I took user deposits, loaned them to myself and then gambled the money". I mean this is like nested layers of stupidity. You'd be stupid to do this, you'd be stupid to think it's not a major crime, you'd be stupid to think that this was in any way acts as a defense of your crime and you'd be stupid to actually tell people that this is what you did thinking that it's a defense for the crime you committed. Guy literally though that Ponzi schemes would be legal if only the perpetrators on the way to court wrote on a document "I hereby lend myself all the money I misappropriated"?
- logicalmonster 4y ago
  Even if he gets convicted of anything non-trivial, how does he actually stay in jail for very long? Call me cynical or a conspiracy theorist or whatever, but a guy who's rubbed shoulders with the "elite" and who probably has at least a billion dollars in crypto stashed away can probably figure out who to bribe to walk out the jail's back door and take a private flight to a country who won't send him back.
- burkaman 4y ago
  For FTX's Sam Bankman-Fried, incompetence could be a legal strategy - https://www.axios.com/2022/11/16/ftx-sam-bankman-fried-incompetence-legal-strategy https://www.axios.com/2022/11/16/ftx-sam-bankman-fried-incom... > Lawyers tell Axios the main criminal risk Bankman-Fried faces is an indictment on charges of fraud — one of the more common charges in white-collar prosecutions. But to convict, prosecutors must prove beyond a reasonable doubt that someone had knowledge or intent to commit fraud, which can be tricky, they say. > That’s why the defense against such charges typically centers on something like, "It wasn't fraud, I was just really bad at my job." > "Typically, in a fraud case, the person at the top argues that he was inattentive, delegated to others, and wasn’t focused on the details," Mariotti tells Axios. "The point is to argue that he was sloppy or inattentive, not a fraudster."
  - AnimalMuppet 4y ago
    OK, but "I loaned it to myself" is a deliberate step. So the defense is "I took user deposits, loaned them to myself and then gambled the money, and I did not know that that constituted fraud or embezzlement." That seems unlikely to fly.
dclusin 4y ago
His lawyers should take away his electronic devices from him.
ZephyrBlu 4y ago
Author: "so the ethics stuff - mostly a front?" SBF: "yeah" Absolutely gobsmacked. I saw these screenshots on Twitter and I thought they were fake until I read the article. The rest of the messages from him are pretty terrible as well. I thought he just fucked up, but no. He was wilfully unethical and maintains he did nothing wrong: "Sometimes life creeps up on you". And the thing he regrets most is filing for Chapter 11 bankruptcy... What a cruel fucking joke for all the people who invested with/in FTX.
- c7DJTLrn 4y ago
  I'm wondering if there is some kind of mass insanity occurring in the world right now with this and the behaviour of numerous influential figures.
  - kingofheroes 4y ago
    Wealth reveals. Just like alcohol.
  - eternalban 4y ago
    No, it is wrong to think it is a "mass" phenomena. A very small group of people around the planet are involved here. What is happening is what happens in all long running systems where the generational selection process becomes ineffective due to (typically) nepotism, hedonism, and corruption. What was once, if arguably ethically challenged, but competent elite gives way to an openly corrupt and incompetent set. Healthy systems check this phenomena -- it happens in all power entities historically -- and correct it. When they fail to correct it, they suddenly collapse.
  - bmitc 4y ago
    You might be interested in Adam Curtis' documentaries. Check them out.
  - w1nst0nsm1th 4y ago
    Something to do with neo-nicotinoid. It would explain a lot.
  - 4y ago
nathias 4y ago
effective altruism is really effective until you get caught
ratg13 4y ago
While most of the important points have been commented on, I would be really interested in more info about the hack. It seems like everyone, (even these characters), don’t even care because it’s “only a few hundred million” And it does seem like whoever this was might get away with it because everyone is focused on the larger issue. Which is understandable.
SilverBirch 4y ago
This is just classic. "OH I'm a crook? Well everyone's a crook!". No Sam. You're a crook, and we're not really intersted in taking moral lessons.It just reads like the lowest effort teenage coping mechanisms. And you know what? Andreesen will fund his next venture. Because it's about class, not returns.
floatinglotus 4y ago
What an asshole. Dude has the nerve to badmouth regulators? What does he think he just did?
memish 4y ago
From the CEO of NuGenesis network and Metalabs global: - Someone was dumping our coin - We found out it was Alameda - We asked them to stop market making, yet they continued dumping, all on Liquid - We have a lot of proof showing the above - We've known about the FTX scam months and months ago & contacted the SEC - Media did not listen to us - No one was listening because no one wanted to believe FTX & SBF was a scammer, even some of the biggest VC firm - I sent everything to the FTC multiple times, MONTHS AGO, & they didn't even reply - I won't comment on whether Gary Gensler was involved - Many exchanges & entities are likely wash trading like FTX. This issue is systematic More summary here https://twitter.com/marionawfal/status/1592947918146654208 https://twitter.com/marionawfal/status/1592947918146654208 Source is the Spaces chat here, starts around 4:51 https://twitter.com/nugenmediahub/status/1592941623306252288 https://twitter.com/nugenmediahub/status/1592941623306252288
- anonymoushn 4y ago
  This Mario person is a charlatan who recently deleted the entire contents of his web site because it was publicly advertising that his career is the sale of fake engagement to pump shitcoins
  - memish 4y ago
    Mario is just the messenger here and host of that chat, not the speaker.
  - luckylion 4y ago
    It's so weird, I had seen that profile a few days ago. Everything about him screams charlatan. The profile images, the "thoughtful" pose, his "I'm getting interviewed", "I'm a speaker" and his "I have an audience watching me dance", it just screams it. Then I went to his website and it ups the volume to 11. He even has a corny motto "Do good - Do it consistently - Be patient". I'm sure lots of people fall for it and think he's legit. Is that just an age thing or are some people just that gullible and when you have global reach via Twitter and Instagram, you'll find them all?
baxtr 4y ago
Unlike many here, I think he has a point. The entire finance industry is corrupt. People have been trying to make more money by being over leveraged for some time now. Anyone remember 2008? Regulation helps, but not most obviously people find ways to get around that. It doesn’t, by any means, excuse what he has done. Yet the conversation delivers a very authentic insight into how people at the top of financial institutions with the goal to earn unreasonable amounts of money the get rich people richer actually think and act. For that it’s a great piece.
- za3faran 4y ago
  If you speak to people on the inside, you'd find that they understand it's a big ponzi scheme, but they continue to work in it while making bank.
  - MrMan 4y ago
    except that is not true
- NelsonMinar 4y ago
  The entire finance industry isn't corrupt. It might want to be, but then it's tightly monitored and regulated so it can't be this corrupt. "Oops we misplaced over half our customer deposits" is just not a thing that happens in real banking or financial exchanges. In crypto companies though, it's business as usual.
- MrMan 4y ago
  you are regurgitating crypto and libertarian propaganda meant to desensitize you to the corruption of what they are selling. the entire finance industry is not corrupt and this moral equivalence they try to construct to justify their crimes and antisocial behavior is false.
alecbz 4y ago
I'm super surprised at how open and off-the-cuff he's being here. Did he not put together that the DMs might get published? Is this just the power of good rapport? Is he trying to be strategic here in some way?
- expazl 4y ago
  We don't know how much money he paid to the person he's talking to. We only know that he _did_ pay money to the person he's talking to, since it's added as a disclaimer in the article. Also it would be silly of Vox to leave that disclaimer out as it' was publicized earlier so they can't run from it. He's thinking he's chatting with an accomplish who's going to help him spin some positive PR to help his last ditch fund raising. But in fact he's chatting with someone who's desperate to distance themselves from a person they received money from, so as not to end up looking like they got paid for biased coverage, which lets be honest is what most likely happened.
  - MisterSandman 4y ago
    He paid money as a grant for Vox the company, for a project that this particular journalists preobabaly wasn't even a part of.
DebtDeflation 4y ago
>Bankman-Fried says his No. 1 priority now is to try to raise $8 billion to make account holders whole. So, basically start up a new Ponzi. Because that's exactly what raising money from new investors to pay off existing investors is. Note he did NOT say "generate $8B in profit". At this point he needs to STFU, stop posting on social media, stop giving interviews in the media, and do whatever his lawyers tell him to.
- rosywoozlechan 4y ago
  I don't think this is an earnest attempt to help his victims. He must know how ridiculous it is to ask for someone to repay his victims losses with nothing to offer in return. Feels like a legal strategy to mitigate criminal and civil consequences.
- anonymoushn 4y ago
  To pay off creditors, not investors. The people he owes $8bn did not buy an investment product, they bought claims on dollars for dollars.
- expazl 4y ago
  Well you see, he wants to take those $8B and put them in a box, then start printing box-tokens that he can lend to his trading arm, then he can build a market for those box tokens giving them intrinsic value, while he siphons the 8B$ off to ... wait, how he's going to make his users whole? Well you see he just needs to raise 16B$ and put them in a box...
- HWR_14 4y ago
  No, this part isn't a ponzi. He has a lot of crypto and he wants someone to buy it all for $8 billion, so he can return that $8 billion to his customers. He says it's worth $9 billion down from $14 billion two weeks ago, so it's a great deal. Now, I would say it's worth far less, maybe hundreds of millions. This part is "if I firesale all the crypto, can I get enough fiat to pay back my customers so that there's no case for me going to jail because no one lost money, just got stressed out."
  - 4y ago
Imnimo 4y ago
The obvious conclusion here is that SBF is just a cynical but skilled manipulator. But then why send these DMs at all - surely a skilled manipulator would know better, or could at least present himself in a positive light? Maybe all those stimulants have taken their toll. Or he's totally given up.
- expazl 4y ago
  > surely a skilled manipulator would know better, or could at least present himself in a positive light? My bet is that he lost his back country. He was until recently the front-person for a hugely successful enterprise who donated money extremely broadly. Back then he could have yelled "I run a goddamn ponzi scheme" into the loudspeaker of huge credible news outlets and they would have edited to "Master genius is going to revolutionize everything through revolutionary crypto". He's speaking into the same loudspeaker because he still thinks the message that got through back then was due to his skills as a communicator and not because... they where all on the receiving end of the cash flow he was throwing around every which direction. But obviously anyone who was receiving money back and writing favorable about him back then will do their best to distance themselves now. Case in point, quote from article: (Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.) Which basically says they where on the payroll. Obviously they aren't going to pay the money back. You have to wonder what great articles about SBF they would have printed in a completely unbiased fashion if not for the implosion.
  - Quarrelsome 4y ago
    are we agreeing with his point that morality comes second to winning?
  - sdwr 4y ago
    Great take. Off topic, but I really love the post-history vibes from this guy, elon, even trump a bit. There's something beautiful about living in public, and not hiding your flaws. No PR or corpo speak or defensible positions, just rawdogging life. And not even behind the 7-11 dumpster, right out there in broad daylight.
molsongolden 4y ago
The comments here and the entire slant of the story are interesting. None of those messages read without the accompanying article seem particularly damning and they all make sense to some extent. The collapse is terrible, there was mismanagement, etc. but these specific DMs don't really make him seem the monster sociopath other commenters are calling him. 1) He pandered to regulators but doesn't believe regulators (across industries) are able to do any real good 2) He didn't mean to do sketchy stuff, a bunch of small decisions snowballed into a disaster 3) Winning > Ethics when it comes to public perception 4) He didn't have a good handle on what was going on at Alameda and didn't keep the entities separate enough as they grew 5) He lacked visibility into what was going on and missed the complex systems failure mode -- Looking at the "ethics" messages for example, SBF never really says that he thinks it is okay to act unethically. * He previously said that that people shouldn't do unethical shit because it'll hurt their reputation * Now (in the DMs) he said: "it's not true really" -> mentions unknown heros and well-known shams -> gives the example of CZ being hated a month ago for being unethical but now CZ is a hero for winning despite being unethical He never says that being unethical is okay—he says that in the world today, winning influences your public perception more than whether you were ethical or unethical.
- Siira 4y ago
  I had this thought, too. Most people probably haven’t read the article at all. They are repeating what others have said the article contained.
fleddr 4y ago
This man really has to be protected against himself. It's foolish to incriminate yourself publicly, but there's more to it. When you watch CT (Crypto Twitter), retail getting wrecked in pump and dumps is an every day event. This one is different though. Some very huge accounts/traders each lost many digits of wealth and given their influence in the community, this doesn't really improve moods. So when a lynch mob is forming, these statements of smug indifference might not exactly calm things down.
ploppyploppy 4y ago
Vox also complicit, along with the NYTimes, in helping gaslight the public on this criminal's actions and helping him get away with it. Grotesque.
- zach_garwood 4y ago
  I don't feel like this article really exonerates him. How are we being gaslit here?
chris_wot 4y ago
The guy thinks he is smarter than everyone else. And he’s not. He’s certainly not smarter than his lawyers (you’d have to assume right now that he has lawyers). Those lawyers would be telling him to shut the fuck up. But no, he’s giving interviews to Vox. All these fawning interviews beforehand. All this assumption that he’s a crypto-messiah. All the true believers. At this point, crypto is a cult. And the sooner it implodes and/or explodes so we can be done with it, the better off society will be.
StayTrue 4y ago
Pretty sure SBF thinks he’s the smartest guy in every room.
throwaway5874 4y ago
a16z and Softbank are the best ventures out there no doubt. haha
chaosbolt 4y ago
Honestly I've been saying lots of bad things about him, but at least he dropped the facade and was a little honest, the thing he said about other exchanges and even traditional finance is true, a bank run on any exchange would cause the same result, do you think Coinbase just won't do fractional reserve? Of course they are... and people experience it at every single market fluctuation where withdrawals get paused for 6 hours at times, and of course traditional finance is even worse, they print trillions, lend them to the government who then gives it to Blackrock to buy company bonds, and Blackrock loves ESG, and even SBF knows that shit is a meme. Then we get to pay interests on that printed loan through taxes, but also through inflation... But hey like Carlin said, it's a big club and you're not in it.
lumost 4y ago
Honest question. Why didn’t he let alemeda fail? He pushed money in to “rescue” it. This money apparently wasn’t enough and it imploded with FTX.
frrp 4y ago
Now I'm waiting for Effective Ventures Foundation (Centre for Effective Altruism) to voluntarily return all donations made by SBF or FTX share-holders. If they do not, all their credibility is lost.
pcdoodle 4y ago
Why is the media standing up for this scammer? Stinks to high heaven...
eternalban 4y ago
The fact that he is casually giving interviews with no attorney present itself is a huge red flag that he already knows that he has his get out of jail free card.

370 points by Hippocrates 4y ago

api 4y ago

The overwhelming feeling I get from this interview is one of cynicism and nihilism. In his mind it's okay if he did shady things because everyone else does. Everything is broken, everyone is corrupt, everything is shit, so fuck it... basically. He more or less admits that the effective altruism stuff was a sham.

jl2718 4y ago

He's being honest here, and we should listen to him. Point 1: Most personalities are shams. Ethics/politics among the powerful is a lie/shibboleth. Instinctively you know this to be true, but hope in a great savior is deeply ingrained. Point 2: Regulators make things worse. They are actively working against our interests. He would know best; they created him. Again, we want to believe in the great savior myth, but they are just people: lazy, corruptible, political, etc. Point 3: Chapter 11 made things worse. He's probably right about this too. He's saying that he would have the power to pay back depositors first. Chapter 11 only gives him legal protection, and puts depositors last. They will liquidate everything to USD, pay a 10% commission for a horrible rate, and then pay the lawyers, then the counterparties, then the investors, and then a tiny fraction back to depositors, years down the road. Another MTGOX/BITFINEX. As a reference, the Irving Picard recovered $9.3B from Madoff and paid only $5.4B to depositors. The rest evaporated in liquidation expenses and legal fees of $700M. The legal fees for Lehman Brothers liquidation was $1.6B. The people running the show now are not your great saviors; they are incompetent, greedy, and morally disconnected.

Denvercoder9 4y ago
Chapter 11 proceedings will not pay investors before depositors.
- jl2718 4y ago
  IANAL, but they may have structured their investment as senior debt, and depositors may have some other funny legal status. Also Alameda has to be dissolved before FTX, so technically FTX depositors are a creditor to Alameda while the Alameda investors are depositors, and typically Chapter 11 discharges debts. Also, Alameda is under Bahamian law, and so is FTX, and US courts will only get what's left.
notch656a 4y ago
Is this satire? The dude is likely a sociopath who is speaking for whatever he think meets his interests and/or vanity.
- eternalban 4y ago
  Some words of wisdom from our 43rd: https://www.youtube.com/watch?v=rQ6N-sb7SVQ https://www.youtube.com/watch?v=rQ6N-sb7SVQ
55555 4y ago
> Irving Picard recovered $9.3B from Madoff and paid only $5.4B to depositors. Is this accurate? That's absolutely insane. _That_ sounds like fraud/theft.
- jl2718 4y ago
  Did you know that Madoff didn't charge fees? His crime was faking the numbers, but the way he made money is, much like SBF, through leverage of managing that money. I don't know much about it, but until the lawyers got involved, the only losses were the made-up gains. Then they took $4B in real money. So, who's the real crook? https://money.cnn.com/2013/05/06/news/companies/madoff-picard-lawyers/index.html https://money.cnn.com/2013/05/06/news/companies/madoff-picar...
AnimalMuppet 4y ago
I fail to see how regulators made this worse. I see loud and clear how the absence of regulators made this worse, whatever SBF says.

TrapLord_Rhodo 4y ago

whats funny here is the btc price action. There clearly was some insider trading before all this happened.

blobbers 4y ago

I'm surprised that he doesn't blame Caroline Ellison more for what's going on. She ran the hedge fund, she f'ed up, and when she f'ed up she took funds from FTX. These people are such idiots.

engineer_22 4y ago

The guy's lawyers need to get him to shut up.

memish 4y ago
What’s even more remarkable is that his dad is a lawyer and reportedly with him…
harry8 4y ago
"You're only making things worse for yourself!" Matthias: "Worse?! How could it get any worse?" --Monty Python's Life of Brian https://montypython.gifglobe.com/scene/?id=2ZrhmRltHUEk https://montypython.gifglobe.com/scene/?id=2ZrhmRltHUEk
AlexandrB 4y ago
Seems like he's chosen the path of a real "poster". Trying to "post through it" until things improve or someone finally takes away his phone/computer.
- pessimizer 4y ago
  Nothing but respect for that position. Never stop posting.
fisherjeff 4y ago
Oh my god, I upvoted you before reading the DMs. I... wow, yeah, they need duct tape. EDIT: Okay I just cannot get over this, obviously I'm exaggerating but it's pretty much "I didn't want to do bad stuff because that would be bad, and then after I had personally done all of the bad things, I realized that I had, in fact, done something very bad."
- yeet_yeet_yeet 4y ago
  Pretty sure he's given up at this point. Nobody would do something this dumb otherwise. And then confirm it the next morning.

flanked-evergl 4y ago

> I feel bad for those who get fucked by it > by this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us Woke washing pays off, that is why everyone does it. But luckily BTC is there to take the blame.

deleted 4y ago

[deleted]

alexb_ 4y ago

SBF is monumentally stupid for sending these messages. Straight up admitting that any "ethics" was for reputation only. And not only that, but saying that the mistake was not doubling down again.

deleted 4y ago
[deleted]
thundergolfer 4y ago
Yeah after the NYT interview I'm a bit shocked at how bad these messages look. He looks stupid, brazen, delusional, and lacking in compassion. If his texts are normally similar to this, how did anyone serious think this guy was brilliant?
- fnimick 4y ago
  > how did anyone serious think this guy was brilliant? He made a lot of money by bucking norms. Hacker news of all places should recognize that people are drawn to those who project an appearance of improbable success through skill despite a lack of underlying competence (see also: Elon Musk)
  - deleted 4y ago
    [deleted]
- s_dev 4y ago
  Maybe I'm out of the loop but I'd never heard of him til the FTX implosion.
  - TremendousJudge 4y ago
    I had, once, in a HN comment a couple of months ago. It said that he was lobbying on some political race, which is something he was doing because he believed in "Effective Altruism". This was presented as a good thing, as though billionaires giving money to politicians was a novel idea. I guess this is the type of person who found him worthy of mention.

tsol 4y ago

The "lament about how corrupt the system is and that we are forced to partake in it" excuse has been popular in recent years, not surprised he's going for it. Let's see how that plays out

r721 4y ago

>Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.

jeffbee 4y ago

Has anyone check on this guy's lawyers? Are they safe?

ZeroGravitas 4y ago

How does this story keep getting worse!? Every time something new comes out.

boeingUH60 4y ago

Jesus Christ…does this guy not know that you should keep quiet when you’re the subject of a criminal investigation from multiple government agencies?

deleted 4y ago
[deleted]
curiousgal 4y ago
I am 30 years old and I am laughing at anyone who has trusted these kids with anything. His balance sheet shows just how childish and out of depth he and his possie of "execs" are.
- nabogh 4y ago
  Just looked it up. SBF is 30?
  - twicetwice 4y ago
    Yup, he founded Alameda Research in 2017 at age 25 and FTX in 2019 at 27.
  - FireBeyond 4y ago
    And I believe for the CFO it was her first job after college. And for another linked CEO they'd been a trader for three years, and then were made CEO at Alameda?
chrchang523 4y ago
This is further evidence that he was thinking of this in terms of all-or-nothing coin flips. In case you haven't seen it: COWEN: Okay, but let’s say there’s a game: 51 percent, you double the Earth out somewhere else; 49 percent, it all disappears. Would you play that game? And would you keep on playing that, double or nothing? BANKMAN-FRIED: With one caveat. Let me give the caveat first, just to be a party pooper, which is, I’m assuming these are noninteracting universes. Is that right? Because to the extent they’re in the same universe, then maybe duplicating doesn’t actually double the value because maybe they would have colonized the other one anyway, eventually. COWEN: But holding all that constant, you’re actually getting two Earths, but you’re risking a 49 percent chance of it all disappearing. BANKMAN-FRIED: Again, I feel compelled to say caveats here, like, “How do you really know that’s what’s happening?” Blah, blah, blah, whatever. But that aside, take the pure hypothetical. COWEN: Then you keep on playing the game. So, what’s the chance we’re left with anything? Don’t I just St. Petersburg paradox you into nonexistence? BANKMAN-FRIED: Well, not necessarily. Maybe you St. Petersburg paradox into an enormously valuable existence. That’s the other option. https://conversationswithtyler.com/episodes/sam-bankman-fried/ https://conversationswithtyler.com/episodes/sam-bankman-frie... (See the first paragraph of https://www.lesswrong.com/posts/BZ6XaCwN4QGgH9CxF/the-kelly-criterion?commentId=3JEaWCYG2B5ocBJg7 https://www.lesswrong.com/posts/BZ6XaCwN4QGgH9CxF/the-kelly-... for the outline of an explanation of why his reasoning was not applicable to most real-life scenarios. This is pretty subtle; >95% of the explanations on the Internet I've seen over the past week as to why SBF is "obviously wrong" don't actually work.) Maybe I'm speaking too soon, but he does seem ready to accept that he lost this flip. It would obviously be insane to trust with him anything big at this point, but I'm optimistic that he won't fight to the bitter end.

jdm2212 4y ago

This is one of the most amazing things I've ever read. Also, I feel so bad for his lawyers.

gizajob 4y ago

"Fuck regulators (and their gung ho attitude to stopping me defrauding billions from everyone around me whilst high on off-label smart-drugs)"

roywiggins 4y ago

> I was trying to make sense of what, behind the PR and the charitable donations and the lobbying, Bankman-Fried actually believes about what’s right and what’s wrong — and especially the ethics of what he did and the industry he worked in. This seems like a weird thing to worry about right now, I imagine my question would be "hey, where'd all the deposits go?" Like, I'm sure it's all interesting in a psychological and sociological way, but "what does SBF really believe" feels like it should take a back seat to what did he do. That's much more interesting! It's easy for someone like SBF to just say stuff about what's going on in his head, whether it's true or not. But, we're talking about real (and, okay, a lot of fake) money here. There's this weird assumption in a lot of reporting that a rich person must have interesting things to say, or beliefs that are worth getting to the bottom of. Sometimes that's true, but sometimes they're just not very interesting people. Which is fine! Lots of people aren't very interesting, but really rich people get to be treated as interesting even if they're actually boring.

wging 4y ago
It makes a lot of sense given the nature of SBF’s charitable donations and the purported rationale(s) behind them. Kelsey Piper is pretty deeply associated with the EA movement, which is heavily interested in picking the right ways to deploy money to solve the world’s problems, and much of SBF’s charitable giving was too.
- ZeroGravitas 4y ago
  > In 2018, Vox launched Future Perfect, with the goal of covering the most critical issues of the day through the lens of effective altruism. In this talk, Kelsey Piper discusses how the project worked out, her experience as a Vox staff writer, and her thoughts on the key challenges of EA-focused journalism. I just commented in this thread about how this story magically keeps getting worse, and then it got worse...
  - SilasX 4y ago
    Yeah when I saw it was Piper as the journalist, I was expecting to see a massive disclaimer/disclosure on the article. There still isn’t one. My own disclosure: I have many mutual friends with Piper and participate in the local EA group and contribute to EA causes.

Mandatum 4y ago

I think he doesn’t care. He knows he’s not going to do much prison time, and he 1000% has fiat stashed given where he incorporated.

AlexandrB 4y ago
You never know. He doesn't seem like a planner based on how the collapse of FTX went down and how he's talking to journalists instead of his lawyer.

reducesuffering 4y ago

He has to still be on methamphetamine-precursors. (Was confirmed in an image on his desk[0]; selegiline) [0] https://milkyeggs.com/?p=175 https://milkyeggs.com/?p=175

perardi 4y ago
Sigh. No. https://astralcodexten.substack.com/p/the-psychopharmacology-of-the-ftx https://astralcodexten.substack.com/p/the-psychopharmacology... Selegiline metabolizes to the inactive isomer of meth: l-methamphetamine. Which is very much not trucker crank—it’s an over-the-counter decongestant. Was he on good ol’ non-meth-amphetamine, in the form of Adderall? Sure. But rather a lot of people are on Adderall, and most of them haven’t created a market-shattering boondoggle.
- reducesuffering 4y ago
  Thanks for the clarification!

throw7 4y ago

cringe who is 'liking' and 'crying' bankman's messages?

smoldesu 4y ago
Apparently someone who is great at buttering him up to say more and more stupid stuff.
- Hippocrates 4y ago
  Exactly.. that is some excellent social engineering/reporting skill.

monero-xmr 4y ago

A programmer who helped create Tornado Cash rots in a Dutch jail cell (not charged, might I add) while SBF, Do Kwan, Elizabeth Holmes, and Trevor Milton still remain free. SBF is actually in a $30 million penthouse playing League of Legends. Clown world

delusional 4y ago
I'd rather have an FTX scandal than Tornado Cash. I'd rather someone does some fraud than actual funneling of money to terrorists, druglords, gangs, and other problematic organizations.
- nailer 4y ago
  Tornado Cash is private banking. The writer of the code did nothing wrong by writing it.
  - leesalminen 4y ago
    Open source code should be considered protected speech. The fact that it’s not should scare the daylights out of any OSS contributor. Also, privacy should be a human right. If you disagree with the above, you might be a fascist.
    - ceejayoz 4y ago
      It's protected speech. What you do with it can be criminal. Code for an Arduino that moves a robotic arm is legal. Using it to pull a trigger and kill someone isn't.
      - leesalminen 4y ago
        Of course. Was the tornado cash person arrested for using the code in an illegal way or just for publishing the code?
        4y ago

SevenNation 4y ago

> Bankman-Fried has maintained that FTX has never invested the deposits of crypto account holders on the exchange. I pressed him on that point via Twitter, and while he continued to insist that FTX did not directly use account money in this way, he said that Alameda — which he also owns — had borrowed far more money from FTX’s balance sheet for investments than he had realized, which ultimately left FTX vulnerable to the crypto equivalent of a bank run. > Why didn’t Bankman-Fried realize what was happening until it was too late? “Sometimes life creeps up on you,” he said. This is the central issue of the case. There aren't many paths for an exchange to experience a run unless it's acting like a fractional reserve bank. So here's an admission that Alameda borrowed from the FTX balance sheet. There's also a denial that FTX invested deposits. There's no way for both statements to be true.

jaywalk 4y ago
FTX loaned the deposits to Alameda, and Alameda invested them. It's totally different from FTX making the investments themselves! /s
- sailplease 4y ago
  A loan is an investment.
- CuriousCosmic 4y ago
  It's somehow even worse given that according to SBF, they didn't even loan all the deposits. Something like $8B of them were being deposited to Alameda directly from users without their knowledge. https://cdn.vox-cdn.com/uploads/chorus_asset/file/24202784/Screen_Shot_2022_11_16_at_7.32.22_AM.png https://cdn.vox-cdn.com/uploads/chorus_asset/file/24202784/S...

cliftonk 4y ago

to be clear: - he lent his own hedge fund $8b collateralized by tokens he controlled issuance of (FTT, SRM, MAPS, OXY). At full size, the liquidation price of these tokens was 0 (he also purchased billions worth of FTT off the market when he could print them himself for free?). - Sensing alameda was insolvent and customer funds were misappropriated, customers withdrew until they ran out of liquidity. - Withdrawals were suspended - Citing Bahamian authorities requests to unfreeze assets of bahamian residents, withdrawals were opened back up for bahamian residents. Hundreds of millions were withdrawn. Bahamian authorities have since made statements that no such requests were made (so this was just insiders stealing even more). - Approx $500m of assets were drained from FTX wallets at the same time as FTX databse records were cleared (obviously not a hack, just insiders stealing even more). - SBF goes on twitter to make new one-letter tweets while simultaneously deleting incriminating tweets so as to not trigger deletion bots picking up that he deleted said tweets. Ongoing theft and destruction of evidence out in the open after stealing 10 billion dollars from over 1 million depositors. SBF has still not been arrested. This all but confirms the wildest of conspiracy theories.

jeffbee 4y ago
You kind of went off the rails there in the final sentence. Are you saying that any of this adds credence to the silly idea that Democrats are beholden to SBF campaign money?
- leesalminen 4y ago
  It’s a silly idea that being the second largest donor to a political party in the US buys you special favors? Why else would anyone give that kind of money to politicians without expecting something in return?
  - harry8 4y ago
    >Why else would anyone give that kind of money to politicians without expecting something in return? There's a polite theory it is done for altruistic reasons to make the country a better place for all and that it is the exercise of free speech and you are also free to give Trump, Biden, Pelosi & McConnell vast amounts of cash. But yes we're all adults here.

wheelerof4te 4y ago

Yes, the game is rigged from the start. But that does not mean you can play innocent when you lose it.

user3939382 4y ago

Anyone with a couple weeks of legal education, never mind the caliber lawyers this guy should be able to afford, would immediately tell him to s t o p t a l k i n g. On a related note: https://youtu.be/d-7o9xYp7eE https://youtu.be/d-7o9xYp7eE

oldgradstudent 4y ago

OMG. "The dog ate my homework" would have been a better excuse. > like, "oh FTX doesn't have a bank account, I guess people can wire to Alameda's to get money on FTX" > ....3 years later... > 'oh fuck it looks like people wired $8b to Alameda and oh god we basically forgot about the stub account that corresponded to that and so it was never delivered to FTX' So they "basically" forgot about $8B not transferred to FTX. But somehow FTX customers saw the funds deposited in their accounts, otherwise they would have complained.

hef19898 4y ago
Since more than one thing can be true at the same time, why not a combination of a) total lack of internal controls, understanding of basic accounting and book keeoing, b) total lack of competence when it comes to manage these amounts of money and c) actively defrauding customers by stealing their deposits?
- oldgradstudent 4y ago
  All of the above. Alameda Research was clearly in the top of the worst hedge funds ever, and clearly they had terrible controls and accounting. However, without (c) you don't get this epic disaster. From SBF's tweets it is clear that they were aware they had to keep customer funds segregated. Remember the time they tried to pretend that USD is protected by the FDIC? https://www.cnbc.com/2022/08/19/crypto-firm-ftx-receives-cease-and-desist-from-fdic-about-insurance.html https://www.cnbc.com/2022/08/19/crypto-firm-ftx-receives-cea... Well, actually it was protected by the FDIC, but not from FTX.
skybrian 4y ago
It doesn't make sense and could all be lies, but to try to interpret it: they saw that the money arrived in the "poorly labelled account" and increased the customer's balance. But in some sense, the money never got to FTX and was still with Alameda. Or alternatively, FTX and Alameda commingled funds using the "poorly labelled account" and it was used for whatever payments either company needed to make, like withdrawals. This lack of separation means the balances were never really backed and it was a Ponzi all along.

kranke155 4y ago

SBF, his foundation and his family are well connected politically. NYT already did a bizarro puff piece on him, now Vox does this (which apparently directly received FTX foundation money). It’s absurd as he is essentially a well connected criminal. edit I do want to correct one thing - this is not a puff piece like the NYT one, actually it implicates him.

vkou 4y ago
Having two professors as parents isn't exactly 'well connected politically'[1]. Two senators, or two billionaires would be. [1] I can't say I've ever felt that I was well-connected politically...
- deleted 4y ago
  [deleted]
- kgwgk 4y ago
  Did your father work with legislators to try to pass laws? “When I went to California to try to fight into it, I thought, ‘Well, there’s only 120 legislators. I’ll talk to them all one on one,'” Bankman said. “I found that in order to do it, I had to hire a lobbyist because I just couldn’t handle the details or get the meetings. In Congress, when I went there, now there’s 500 plus, and what I found everywhere I went is that Intuit had already preceded me. They’d already met every representative I was going to meet.” Did your mother create a political fundraising organization? “In 2018, the secretive Stanford-connected Democratic fundraising group Mind the Gap (MTG) funneled over $20 million toward competitive U.S. House of Representative elections and get-out-the-vote (GOTV) organizations. In 2020, MTG wants to increase that number to $140 million. “MTG is led by Barbara Fried, the William W. and Gertrude H. Saunders Professor of Law; Paul Brest, an emeritus professor of law and director of the Law and Policy Lab; and Graham Gottlieb, a Stanford research affiliate. Of the three, Gottlieb has the most direct policy experience, having formerly served in junior roles in former President Barack Obama’s 2012 reelection campaign and in Obama’s White House.”
  - HideousKojima 4y ago

hahaxdxd123 4y ago

Somewhat unrelated to this article, but could someone clear up a point of confusion for me? There are people blaming the CTFC and Congress and the Democrats that SBF donated to for not regulating this. But was FTX (the Bahamian entity) even under their purview? AFAIK, you weren't even allowed to access FTX from a USA IP address, you had to use a VPN. You could access FTX US which was a different thing and offered a much smaller subset of the products FTX did (and that business seems solvent?) Like what jurisdiction does the USA have over a crypto exchange elsewhere? I know anything that touches a US dollar can be tried in a Manhattan court and maybe he gets convicted of a crime and extradited here. But like Japanese banks touch US dollars as well, but the USA doesn't get to regulate them, right?

SilasX 4y ago
FTX US failed too though.
- AlexandrB 4y ago
  Even though it was supposed to be a completely separate entity (or so we were told). ¯\_(ツ)_/¯

kragen 4y ago

tfw you forget the old friend you're dming on twitter about your life problems is now working as a reporter for vox and is going to post your whole dm thread as an article

throwaway821909 4y ago
I'd never heard of the guy until now so maybe it's obvious but you do wonder in these situations, he must have realised that the questions were leading to an article but did he expect the transcript to be published verbatim?
- kragen 4y ago
  maybe he didn't remember theunitofcaring had become a journalist and thought he could trust her
  - kragen 4y ago
    it turns out my guess above was right: he didn't know she was planning to publish the dm thread https://nitter.net/SBF_FTX/status/1593014934207881218#m https://nitter.net/SBF_FTX/status/1593014934207881218#m > Nov 16 > 25) Last night I talked to a friend of mine. > They published my messages. Those were not intended to be public, but I guess they are now. theunitofcaring responded at https://forum.effectivealtruism.org/posts/vjyWBnCmXjErAN6sZ/kelsey-piper-s-recent-interview-of-sbf?commentId=2PnCgCb7dpfZbZQCe#HjTxn7WFne7vnovNA https://forum.effectivealtruism.org/posts/vjyWBnCmXjErAN6sZ/... journalists are not your friend

deleted 4y ago

[deleted]

deleted 4y ago
[deleted]

lordnacho 4y ago

Well there's a sense of contrition there, so that's good. However there's no reasonable excuse. You can't be like "aw man, I wish we'd been more organized". A big piece of this is on the investors. All those depositors would have been saying "Hey Sequoia and OTPP are in there, they must have checked things are sound". Was that foolish of them, to assume reputable investors had done their due diligence? You're between a rock and a hard place when you answer this. Either they should have all done their own DD, basically not invested because who can do DD as a little guy, or large investors are not responsible for what everyone else thinks they did, which is a rather major indictment of how our financial system works. But back to SBF's explanation. It's just juvenile, basically the same as "mommy, you didn't make me clean my room and now I slipped and hurt myself". Whatever the laws are, when someone trusts you with their money, you are responsible for certain basic things like knowing where that money is. All the money in the world and they didn't think to hire an accountant and a risk manager. Or perhaps they did and those people quietly left, we'll never know. About the regulators, it's quite the about-turn. He goes from saying it's a good thing (which was why CZ got pissed at him?) to saying it was just PR, and that regs basically don't work anywhere. I think this is also a juvenile view. You can make the case that it often leads to unintended consequences, and that it often causes problems, but you can't sweep all regulations in all sectors into the bin, there's just too much evidence that it sometimes does work. In fact you could say that the very reinvention of finance as crypto ought to motivate participants to look at what problems were found in the financial world that were addressed by regulation. Glass-Steagal, deposit insurance, central banking, there's a lot to read about.

throwawaylinux 4y ago
> Well there's a sense of contrition there, so that's good. Sigh. So this is how confidence men and politicians and scammers can make good livings. He just said that all the good-sounding things he said in the past about ethics and doing the right thing was "this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us".
- kindatrue 4y ago
  SBF: "I always lie except right now" People: oh wow so true

dibt 4y ago

Did Bernie Madoff make it this easy? Or is this an elaborate plan he's already designed with game theory?

bboylen 4y ago

Not seeing much remorse here, but what can you expect from a guy that gambled with billions of dollars worth of people's savings. Don't buy that he didn't realize what they were doing until it was too late. He admits in this interview to lying about previous public positions, so wouldn't trust anything he says here either. I just hope crypto learns from this and normalizes Proof of Reserves

yeet_yeet_yeet 4y ago
What about you just keep custody of your own damn coins? Isn't that the point of cryptocurrency, that it's like cash except you don't have to physically carry it.
lottin 4y ago
Proof of reserves only proves (for the sake of the argument let's assume it's an actual proof) the exchange has some amount of reserves, which is mostly meaningless. The quantity of interest is the share of deposits that are backed with reserves, not the absolute amount of reserves.
- bogomipz 4y ago
  Interesting, is this intentional then? Or is there some other reason why showing the absolute amount of reserves would not be feasible?
  - lottin 4y ago
    I don't know, it looks like a half-baked idea, like everything surrounding crypto-currencies. Someone probably came up with this proof of reserves idea, and everybody else said yeah let's do this, because it sounded like it does what they wanted to do, except it doesn't.
    - RustyRussell 4y ago
      Yeah, the original Proof of Reserves proposals (and this is probably a decade ago, on the bitcointalk forum) was a merkle scheme IIRC in which each user could verify that their amounts were added into the proven total. Most people seem to be just using "prove you hold some amount" which is a very poor cousin. However, it is pretty clear that FTX would have failed even that, so maybe we should lower our expectations?

Barrin92 4y ago

that's one of the wildest things I've ever read. So the guy faces criminal investigations and may owe people billions and he DMs a reporter and tells her literally, "yeah most of the ethics stuff I did was PR"..? I don't pride myself on having a lot of criminal energy or anthing but I don't understand how he even got to this point. Is this his last act of effective altruism for whoever sues him in a court?

NwtnsMthd 4y ago

> ... by this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us Sums up much of the world we live in :/

teg4n_ 4y ago
Not really. That’s an incredibly cynical take.
- deleted 4y ago
  [deleted]

harry8 4y ago

SBF has used at least one cpu attached to a network on the critical path of his actions. Will this be enough to cause people to be stupid enough to let his powerful and connected family and friends get him off light? People in positions of power seem to get awfully stupid when there's a cpu attached to the network on the critical path. Madoff, no cpu on the network on the critical path. All understandable and could have been done the same with paper and a filing cabinet. SBF - so the code actually does (brain shuts down). Interesting to see if this is so extreme people will keep thinking through the part where they want to stop because "computer"

_dain_ 4y ago
what
- harry8 4y ago
  Even just the mere mention of the involvement of a network attched cpu seems to be able to cause the failure of all forms of critical reasoning in many people. See above.
  - _dain_ 4y ago
    i had to re-read what you were saying about 5 times before i understood your point, i honestly thought you were some kind of schizophrenic with the way you phrased it and kept repeating the same awkward term -- edit: I'm rate-limited so I can't respond to your other reply. I'm saying that your comment looks like something a crazy person would write and I had a hard time parsing it. this is like a garden-path sentence: > SBF has used at least one cpu attached to a network on the critical path of his actions. Will this be enough to cause people to be stupid enough to let his powerful and connected family and friends get him off light? People in positions of power seem to get awfully stupid when there's a cpu attached to the network on the critical path. i thought you were making some kind of paranoid implication about the intel management engine or mind control or something. and I replied because I thought you should know that what you wrote wasn't clear on the first, second, third, and fourth readings.

deleted 4y ago

[deleted]

pr337h4m 4y ago

It's surprising that SBF sounds so libertarian suddenly - he was lobbying for government control of crypto just one month ago (which rightfully made him super-unpopular among the OG crypto crowd) https://www.moneyandstate.com/blog/response-to-sbf https://www.moneyandstate.com/blog/response-to-sbf He does sound sincere here - no idea what to make of this.

pr337h4m 4y ago
> there are people who know what's that like, and who want to do for someone else what nobody did for them He probably hopes for a bailout from either BitMEX or Bitfinex-Tether and is simply trying to appease them by walking back his pro-government views

expazl 4y ago

It this real? Is he really THAT stupid? His defense against "you took user deposits and gambled the money" is "No, I took user deposits, loaned them to myself and then gambled the money". I mean this is like nested layers of stupidity. You'd be stupid to do this, you'd be stupid to think it's not a major crime, you'd be stupid to think that this was in any way acts as a defense of your crime and you'd be stupid to actually tell people that this is what you did thinking that it's a defense for the crime you committed. Guy literally though that Ponzi schemes would be legal if only the perpetrators on the way to court wrote on a document "I hereby lend myself all the money I misappropriated"?

logicalmonster 4y ago
Even if he gets convicted of anything non-trivial, how does he actually stay in jail for very long? Call me cynical or a conspiracy theorist or whatever, but a guy who's rubbed shoulders with the "elite" and who probably has at least a billion dollars in crypto stashed away can probably figure out who to bribe to walk out the jail's back door and take a private flight to a country who won't send him back.
burkaman 4y ago
For FTX's Sam Bankman-Fried, incompetence could be a legal strategy - https://www.axios.com/2022/11/16/ftx-sam-bankman-fried-incompetence-legal-strategy https://www.axios.com/2022/11/16/ftx-sam-bankman-fried-incom... > Lawyers tell Axios the main criminal risk Bankman-Fried faces is an indictment on charges of fraud — one of the more common charges in white-collar prosecutions. But to convict, prosecutors must prove beyond a reasonable doubt that someone had knowledge or intent to commit fraud, which can be tricky, they say. > That’s why the defense against such charges typically centers on something like, "It wasn't fraud, I was just really bad at my job." > "Typically, in a fraud case, the person at the top argues that he was inattentive, delegated to others, and wasn’t focused on the details," Mariotti tells Axios. "The point is to argue that he was sloppy or inattentive, not a fraudster."
- AnimalMuppet 4y ago
  OK, but "I loaned it to myself" is a deliberate step. So the defense is "I took user deposits, loaned them to myself and then gambled the money, and I did not know that that constituted fraud or embezzlement." That seems unlikely to fly.

dclusin 4y ago

His lawyers should take away his electronic devices from him.

ZephyrBlu 4y ago

Author: "so the ethics stuff - mostly a front?" SBF: "yeah" Absolutely gobsmacked. I saw these screenshots on Twitter and I thought they were fake until I read the article. The rest of the messages from him are pretty terrible as well. I thought he just fucked up, but no. He was wilfully unethical and maintains he did nothing wrong: "Sometimes life creeps up on you". And the thing he regrets most is filing for Chapter 11 bankruptcy... What a cruel fucking joke for all the people who invested with/in FTX.

c7DJTLrn 4y ago
I'm wondering if there is some kind of mass insanity occurring in the world right now with this and the behaviour of numerous influential figures.
- kingofheroes 4y ago
  Wealth reveals. Just like alcohol.
- eternalban 4y ago
  No, it is wrong to think it is a "mass" phenomena. A very small group of people around the planet are involved here. What is happening is what happens in all long running systems where the generational selection process becomes ineffective due to (typically) nepotism, hedonism, and corruption. What was once, if arguably ethically challenged, but competent elite gives way to an openly corrupt and incompetent set. Healthy systems check this phenomena -- it happens in all power entities historically -- and correct it. When they fail to correct it, they suddenly collapse.
- bmitc 4y ago
  You might be interested in Adam Curtis' documentaries. Check them out.
- w1nst0nsm1th 4y ago
  Something to do with neo-nicotinoid. It would explain a lot.
- 4y ago

nathias 4y ago

effective altruism is really effective until you get caught

ratg13 4y ago

While most of the important points have been commented on, I would be really interested in more info about the hack. It seems like everyone, (even these characters), don’t even care because it’s “only a few hundred million” And it does seem like whoever this was might get away with it because everyone is focused on the larger issue. Which is understandable.

SilverBirch 4y ago

This is just classic. "OH I'm a crook? Well everyone's a crook!". No Sam. You're a crook, and we're not really intersted in taking moral lessons.It just reads like the lowest effort teenage coping mechanisms. And you know what? Andreesen will fund his next venture. Because it's about class, not returns.

floatinglotus 4y ago

What an asshole. Dude has the nerve to badmouth regulators? What does he think he just did?

memish 4y ago

From the CEO of NuGenesis network and Metalabs global: - Someone was dumping our coin - We found out it was Alameda - We asked them to stop market making, yet they continued dumping, all on Liquid - We have a lot of proof showing the above - We've known about the FTX scam months and months ago & contacted the SEC - Media did not listen to us - No one was listening because no one wanted to believe FTX & SBF was a scammer, even some of the biggest VC firm - I sent everything to the FTC multiple times, MONTHS AGO, & they didn't even reply - I won't comment on whether Gary Gensler was involved - Many exchanges & entities are likely wash trading like FTX. This issue is systematic More summary here https://twitter.com/marionawfal/status/1592947918146654208 https://twitter.com/marionawfal/status/1592947918146654208 Source is the Spaces chat here, starts around 4:51 https://twitter.com/nugenmediahub/status/1592941623306252288 https://twitter.com/nugenmediahub/status/1592941623306252288

anonymoushn 4y ago
This Mario person is a charlatan who recently deleted the entire contents of his web site because it was publicly advertising that his career is the sale of fake engagement to pump shitcoins
- memish 4y ago
  Mario is just the messenger here and host of that chat, not the speaker.
- luckylion 4y ago
  It's so weird, I had seen that profile a few days ago. Everything about him screams charlatan. The profile images, the "thoughtful" pose, his "I'm getting interviewed", "I'm a speaker" and his "I have an audience watching me dance", it just screams it. Then I went to his website and it ups the volume to 11. He even has a corny motto "Do good - Do it consistently - Be patient". I'm sure lots of people fall for it and think he's legit. Is that just an age thing or are some people just that gullible and when you have global reach via Twitter and Instagram, you'll find them all?

baxtr 4y ago

Unlike many here, I think he has a point. The entire finance industry is corrupt. People have been trying to make more money by being over leveraged for some time now. Anyone remember 2008? Regulation helps, but not most obviously people find ways to get around that. It doesn’t, by any means, excuse what he has done. Yet the conversation delivers a very authentic insight into how people at the top of financial institutions with the goal to earn unreasonable amounts of money the get rich people richer actually think and act. For that it’s a great piece.

za3faran 4y ago
If you speak to people on the inside, you'd find that they understand it's a big ponzi scheme, but they continue to work in it while making bank.
- MrMan 4y ago
  except that is not true
NelsonMinar 4y ago
The entire finance industry isn't corrupt. It might want to be, but then it's tightly monitored and regulated so it can't be this corrupt. "Oops we misplaced over half our customer deposits" is just not a thing that happens in real banking or financial exchanges. In crypto companies though, it's business as usual.
MrMan 4y ago
you are regurgitating crypto and libertarian propaganda meant to desensitize you to the corruption of what they are selling. the entire finance industry is not corrupt and this moral equivalence they try to construct to justify their crimes and antisocial behavior is false.

alecbz 4y ago

I'm super surprised at how open and off-the-cuff he's being here. Did he not put together that the DMs might get published? Is this just the power of good rapport? Is he trying to be strategic here in some way?

expazl 4y ago
We don't know how much money he paid to the person he's talking to. We only know that he _did_ pay money to the person he's talking to, since it's added as a disclaimer in the article. Also it would be silly of Vox to leave that disclaimer out as it' was publicized earlier so they can't run from it. He's thinking he's chatting with an accomplish who's going to help him spin some positive PR to help his last ditch fund raising. But in fact he's chatting with someone who's desperate to distance themselves from a person they received money from, so as not to end up looking like they got paid for biased coverage, which lets be honest is what most likely happened.
- MisterSandman 4y ago
  He paid money as a grant for Vox the company, for a project that this particular journalists preobabaly wasn't even a part of.

DebtDeflation 4y ago

>Bankman-Fried says his No. 1 priority now is to try to raise $8 billion to make account holders whole. So, basically start up a new Ponzi. Because that's exactly what raising money from new investors to pay off existing investors is. Note he did NOT say "generate $8B in profit". At this point he needs to STFU, stop posting on social media, stop giving interviews in the media, and do whatever his lawyers tell him to.

rosywoozlechan 4y ago
I don't think this is an earnest attempt to help his victims. He must know how ridiculous it is to ask for someone to repay his victims losses with nothing to offer in return. Feels like a legal strategy to mitigate criminal and civil consequences.
anonymoushn 4y ago
To pay off creditors, not investors. The people he owes $8bn did not buy an investment product, they bought claims on dollars for dollars.
expazl 4y ago
Well you see, he wants to take those $8B and put them in a box, then start printing box-tokens that he can lend to his trading arm, then he can build a market for those box tokens giving them intrinsic value, while he siphons the 8B$ off to ... wait, how he's going to make his users whole? Well you see he just needs to raise 16B$ and put them in a box...
HWR_14 4y ago
No, this part isn't a ponzi. He has a lot of crypto and he wants someone to buy it all for $8 billion, so he can return that $8 billion to his customers. He says it's worth $9 billion down from $14 billion two weeks ago, so it's a great deal. Now, I would say it's worth far less, maybe hundreds of millions. This part is "if I firesale all the crypto, can I get enough fiat to pay back my customers so that there's no case for me going to jail because no one lost money, just got stressed out."
- 4y ago

Imnimo 4y ago

The obvious conclusion here is that SBF is just a cynical but skilled manipulator. But then why send these DMs at all - surely a skilled manipulator would know better, or could at least present himself in a positive light? Maybe all those stimulants have taken their toll. Or he's totally given up.

expazl 4y ago
> surely a skilled manipulator would know better, or could at least present himself in a positive light? My bet is that he lost his back country. He was until recently the front-person for a hugely successful enterprise who donated money extremely broadly. Back then he could have yelled "I run a goddamn ponzi scheme" into the loudspeaker of huge credible news outlets and they would have edited to "Master genius is going to revolutionize everything through revolutionary crypto". He's speaking into the same loudspeaker because he still thinks the message that got through back then was due to his skills as a communicator and not because... they where all on the receiving end of the cash flow he was throwing around every which direction. But obviously anyone who was receiving money back and writing favorable about him back then will do their best to distance themselves now. Case in point, quote from article: (Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.) Which basically says they where on the payroll. Obviously they aren't going to pay the money back. You have to wonder what great articles about SBF they would have printed in a completely unbiased fashion if not for the implosion.
- Quarrelsome 4y ago
  are we agreeing with his point that morality comes second to winning?
- sdwr 4y ago
  Great take. Off topic, but I really love the post-history vibes from this guy, elon, even trump a bit. There's something beautiful about living in public, and not hiding your flaws. No PR or corpo speak or defensible positions, just rawdogging life. And not even behind the 7-11 dumpster, right out there in broad daylight.

molsongolden 4y ago

The comments here and the entire slant of the story are interesting. None of those messages read without the accompanying article seem particularly damning and they all make sense to some extent. The collapse is terrible, there was mismanagement, etc. but these specific DMs don't really make him seem the monster sociopath other commenters are calling him. 1) He pandered to regulators but doesn't believe regulators (across industries) are able to do any real good 2) He didn't mean to do sketchy stuff, a bunch of small decisions snowballed into a disaster 3) Winning > Ethics when it comes to public perception 4) He didn't have a good handle on what was going on at Alameda and didn't keep the entities separate enough as they grew 5) He lacked visibility into what was going on and missed the complex systems failure mode -- Looking at the "ethics" messages for example, SBF never really says that he thinks it is okay to act unethically. * He previously said that that people shouldn't do unethical shit because it'll hurt their reputation * Now (in the DMs) he said: "it's not true really" -> mentions unknown heros and well-known shams -> gives the example of CZ being hated a month ago for being unethical but now CZ is a hero for winning despite being unethical He never says that being unethical is okay—he says that in the world today, winning influences your public perception more than whether you were ethical or unethical.

Siira 4y ago
I had this thought, too. Most people probably haven’t read the article at all. They are repeating what others have said the article contained.

fleddr 4y ago

This man really has to be protected against himself. It's foolish to incriminate yourself publicly, but there's more to it. When you watch CT (Crypto Twitter), retail getting wrecked in pump and dumps is an every day event. This one is different though. Some very huge accounts/traders each lost many digits of wealth and given their influence in the community, this doesn't really improve moods. So when a lynch mob is forming, these statements of smug indifference might not exactly calm things down.

ploppyploppy 4y ago

Vox also complicit, along with the NYTimes, in helping gaslight the public on this criminal's actions and helping him get away with it. Grotesque.

zach_garwood 4y ago
I don't feel like this article really exonerates him. How are we being gaslit here?

chris_wot 4y ago

The guy thinks he is smarter than everyone else. And he’s not. He’s certainly not smarter than his lawyers (you’d have to assume right now that he has lawyers). Those lawyers would be telling him to shut the fuck up. But no, he’s giving interviews to Vox. All these fawning interviews beforehand. All this assumption that he’s a crypto-messiah. All the true believers. At this point, crypto is a cult. And the sooner it implodes and/or explodes so we can be done with it, the better off society will be.

StayTrue 4y ago

Pretty sure SBF thinks he’s the smartest guy in every room.

throwaway5874 4y ago

a16z and Softbank are the best ventures out there no doubt. haha

chaosbolt 4y ago

Honestly I've been saying lots of bad things about him, but at least he dropped the facade and was a little honest, the thing he said about other exchanges and even traditional finance is true, a bank run on any exchange would cause the same result, do you think Coinbase just won't do fractional reserve? Of course they are... and people experience it at every single market fluctuation where withdrawals get paused for 6 hours at times, and of course traditional finance is even worse, they print trillions, lend them to the government who then gives it to Blackrock to buy company bonds, and Blackrock loves ESG, and even SBF knows that shit is a meme. Then we get to pay interests on that printed loan through taxes, but also through inflation... But hey like Carlin said, it's a big club and you're not in it.

lumost 4y ago

Honest question. Why didn’t he let alemeda fail? He pushed money in to “rescue” it. This money apparently wasn’t enough and it imploded with FTX.

frrp 4y ago

Now I'm waiting for Effective Ventures Foundation (Centre for Effective Altruism) to voluntarily return all donations made by SBF or FTX share-holders. If they do not, all their credibility is lost.

pcdoodle 4y ago

Why is the media standing up for this scammer? Stinks to high heaven...

eternalban 4y ago

The fact that he is casually giving interviews with no attorney present itself is a huge red flag that he already knows that he has his get out of jail free card.