4 ms·

In other words, the investors were stupid and deserved what they got. Customers were owed better, but large scale investors who don't do due diligence and end

In other words, the investors were stupid and deserved what they got. Customers were owed better, but large scale investors who don't do due diligence and end up losing their shirts deserve every bit of it.

notch656a 4y ago
I think it's more likely that the more sophisticated investors knew there was a lot of handwaving going on and they thought they'd get through the exits with principal+profit before they became clogged. Sometimes people are known to just not ask if they think the details are odious and they want to maintain plausible deniability about knowledge of source of the profits.
amanj41 4y ago
I have to agree with this. While I don't like to victim blame usually, the VCs are too much in a position of power to truly be victims here. They absolutely could have pushed for more transparency or a board and likely would have smelled smoke when there was none
- preommr 4y ago
  > VCs are too much in a position of power to truly be victims here Sam playing league of legends during his pitch meeting with squioa capital gets memed a lot but it truly is absolutely staggering that so little common sense was applied here.
- JamesianP 4y ago
  VC's also have a high risk tolerance. Not every investment is even expected to pay off. So yes from their perspective, they took a risky bet and lost. But they'd still have a case as victims if FTX signed contracts and then violated them. Or broke laws which cost them money.
dsr_ 4y ago
Are you familiar with the term "accredited investor"? It's a formal term that the SEC uses to differentiate Joe Upper-Middle who has put 200K in a retirement program, from Josefina Nouveau, who has either: earned income exceeding $200,000, or $300,000 when combined with a spouse, during each of the previous two full calendar years, and a reasonable expectation of the same for the current year or a net worth greater than $1 million (either by yourself or combined with a spouse), excluding your primary residence. and is therefore expected, rightly or wrongly, to be able to judge the riskiness of a potential investment and absorb the loss without being crippled.

notch656a 4y ago

I think it's more likely that the more sophisticated investors knew there was a lot of handwaving going on and they thought they'd get through the exits with principal+profit before they became clogged. Sometimes people are known to just not ask if they think the details are odious and they want to maintain plausible deniability about knowledge of source of the profits.

amanj41 4y ago

I have to agree with this. While I don't like to victim blame usually, the VCs are too much in a position of power to truly be victims here. They absolutely could have pushed for more transparency or a board and likely would have smelled smoke when there was none

preommr 4y ago
> VCs are too much in a position of power to truly be victims here Sam playing league of legends during his pitch meeting with squioa capital gets memed a lot but it truly is absolutely staggering that so little common sense was applied here.
JamesianP 4y ago
VC's also have a high risk tolerance. Not every investment is even expected to pay off. So yes from their perspective, they took a risky bet and lost. But they'd still have a case as victims if FTX signed contracts and then violated them. Or broke laws which cost them money.

dsr_ 4y ago

Are you familiar with the term "accredited investor"? It's a formal term that the SEC uses to differentiate Joe Upper-Middle who has put 200K in a retirement program, from Josefina Nouveau, who has either: earned income exceeding $200,000, or $300,000 when combined with a spouse, during each of the previous two full calendar years, and a reasonable expectation of the same for the current year or a net worth greater than $1 million (either by yourself or combined with a spouse), excluding your primary residence. and is therefore expected, rightly or wrongly, to be able to judge the riskiness of a potential investment and absorb the loss without being crippled.