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What? FTX isn't a US security that was traded on any platform. VCs (and accredited investors) are people rich enough, that the USA / regulators have deemed it

What? FTX isn't a US security that was traded on any platform. VCs (and accredited investors) are people rich enough, that the USA / regulators have deemed it "fine" if they lose a lot of money. Accredited investors are supposed to have over $1M bucks not because it proves that they're smart. Its so that when they inevitably get caught in a Ponzi scheme or whatever, USA doesn't have to rush in and save their money. Welcome to USA. If you're an accredited investor and/or Venture Capitalist, the training wheels are entirely off. You're on your own. -------- There's no FDIC insurance or SEC governing FTX's deposits. Its wholly unregulated, and in the Bahamas to boot.

danans 4y ago
> Welcome to USA. If you're an accredited investor and/or Venture Capitalist, the training wheels are entirely off. Who were they were trying to reach with their Superbowl ads, VCs? I suspect not.
- User23 4y ago
  Roughly 10% of American households are accredited. Bilking affluent boomers is a big business.
  - danans 4y ago
    Was accreditation a requirement for investing in FTX? It doesn't seem like it from the accounts of retail investors losing significant amounts of money.
lmm 4y ago
The US legal system needs to start going after VCs that invest in criminal companies. They may not be breaking the law themselves, but they profit off lawbreaking, and they're the ones with the deep pockets. (Isn't this the whole point of RICO?)
SilverBirch 4y ago
FTX took deposits from unaccredited US investors with specific guarantees about what would happen with the money and they filed for bankruptcy in Delaware. I don't care about the VCs getting their money, I'm happy they go to zero etc- I'm saying the opposite, the VCs gave a false sense of security to regular folk that FTX was legit, but in reality FTX was telling depositors that they were doing all these things to protect them that they weren't. At minimum, the regulators should say "Hey, you can't tell people their money is safe if it isn't" (siloed customer accounts etc) at best the regulators should say "Hey, you have to make sure regular consumers are safe if you plan to take money from US consumers".
- freejazz 4y ago
  What does filing for bankruptcy in Delaware have to do with anything?
  - HWR_14 4y ago
    US law vs. Panamanian law.
    - freejazz 4y ago
      If its not a US corp they aren't going to apply US bankruptcy law, they will apply the bankruptcy law of the jurisdiction the corp is registered in. They went to the US court because it will be a quicker disposition of the case.
      - HWR_14 4y ago
        They have a US division. Multinationals going bankrupt seems like there will be issues about which group owns what and the various obligations between them.
        freejazz 4y ago
        So the bankruptcy of the US division will have US law, the others will according to their own jurisdictions. > Multinationals going bankrupt seems like there will be issues about which group owns what and the various obligations between them. Yes, which will be decided according to the bankruptcy law of the corp's incorporation, not the one it chooses. You are confusing choice of law with venue.
black_13 4y ago

danans 4y ago

> Welcome to USA. If you're an accredited investor and/or Venture Capitalist, the training wheels are entirely off. Who were they were trying to reach with their Superbowl ads, VCs? I suspect not.

User23 4y ago
Roughly 10% of American households are accredited. Bilking affluent boomers is a big business.
- danans 4y ago
  Was accreditation a requirement for investing in FTX? It doesn't seem like it from the accounts of retail investors losing significant amounts of money.

lmm 4y ago

The US legal system needs to start going after VCs that invest in criminal companies. They may not be breaking the law themselves, but they profit off lawbreaking, and they're the ones with the deep pockets. (Isn't this the whole point of RICO?)

SilverBirch 4y ago

FTX took deposits from unaccredited US investors with specific guarantees about what would happen with the money and they filed for bankruptcy in Delaware. I don't care about the VCs getting their money, I'm happy they go to zero etc- I'm saying the opposite, the VCs gave a false sense of security to regular folk that FTX was legit, but in reality FTX was telling depositors that they were doing all these things to protect them that they weren't. At minimum, the regulators should say "Hey, you can't tell people their money is safe if it isn't" (siloed customer accounts etc) at best the regulators should say "Hey, you have to make sure regular consumers are safe if you plan to take money from US consumers".

freejazz 4y ago
What does filing for bankruptcy in Delaware have to do with anything?
- HWR_14 4y ago
  US law vs. Panamanian law.
  - freejazz 4y ago
    If its not a US corp they aren't going to apply US bankruptcy law, they will apply the bankruptcy law of the jurisdiction the corp is registered in. They went to the US court because it will be a quicker disposition of the case.
    - HWR_14 4y ago
      They have a US division. Multinationals going bankrupt seems like there will be issues about which group owns what and the various obligations between them.
      - freejazz 4y ago
        So the bankruptcy of the US division will have US law, the others will according to their own jurisdictions. > Multinationals going bankrupt seems like there will be issues about which group owns what and the various obligations between them. Yes, which will be decided according to the bankruptcy law of the corp's incorporation, not the one it chooses. You are confusing choice of law with venue.

black_13 4y ago