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Regulators (specifically Gary Gansler at SEC) job is to protect consumers generally, pointing at VCs just shows that they are not doing their job. FTX is an of

Regulators (specifically Gary Gansler at SEC) job is to protect consumers generally, pointing at VCs just shows that they are not doing their job. FTX is an offshore company, but Genesis, Blockfi, FTX US, Gemini, Coinbase are not, and regulators let them offer unregistered securities for a long time.

bdcravens 4y ago
FTX stole investors' funds. That's a far greater concern than unregistered securities.
- namdnay 4y ago
  The former usually follows the latter
- throwawaycities 4y ago
  Lucky for those investors the FTC’s investigation shows the funds/VCs handling their investments were negligent and breached their fiduciary duty by not conducting any due diligence. Time for those investors to sue the VCs/funds.
  - cactusplant7374 4y ago
    Looking forward to the depositions.
- deleted 4y ago
  [deleted]
nickpinkston 4y ago
Yea, this is more of a story of SBF and other crypto elites making a lot of donations to wealthy politicians, media companies, etc. who were hesitant to investigate them. Bloomberg apparently was presented evidence of the FTX fraud many months before its downfall which it didn't cover because it was bad for business. [1] This was also what happened in the Madoff case where outside investigators discovered the fraud and sent their pile of evidence to the Feds, who sat on it for years as the fraud expanded. [2] I bet we'll eventually see messages from SBF & Co. talking about Madoff specifically as a model for the scheme. [1] https://www.youtube.com/watch?v=qXzvVRw_Qgw https://www.youtube.com/watch?v=qXzvVRw_Qgw [2] https://en.wikipedia.org/wiki/Harry_Markopolos#Madoff_investigation https://en.wikipedia.org/wiki/Harry_Markopolos#Madoff_invest...
- ejstronge 4y ago
  It is hard to believe the claim in the video that ‘5 crypto ladies’ at Bloomberg passed on this enormous story absent evidence from the speaker. Regarding Madoff, there were indeed investigations after some of the complaints. Notably, these situations differ in that Madoff was a respected figure within the regulatory apparatus (but it’s hard to imagine that SBF holds sway over the editorial process at Bloomberg). It is true that the investigations into Madoff were ineffectual, at least according to reports I have seen
  - nickpinkston 4y ago
    Yea, that's why I linked to the video (re: source is a single witness), but also SBF was definitely a powerful guy almost to the degree Madoff was, and we already see publications like the NY Times covering for SBF [1], so I don't see that as a big jump. I have a personal journalist friend whose editors didn't let them cover Theranos before the WSJ broke the news for similar reasons, so it's not out of the question. Not to mention the regulatory apparatus and Congressional inaction. [2] [1] https://www.youtube.com/watch?v=UqDJ6Ph8r9o https://www.youtube.com/watch?v=UqDJ6Ph8r9o [2] https://fortune.com/2022/11/10/ftx-crypto-collapse-binance-congress-regulation-sbf/ https://fortune.com/2022/11/10/ftx-crypto-collapse-binance-c...
dragonwriter 4y ago
> FTX is an offshore company, FTX.US is not
- throw03172019 4y ago
  OP listed FTX US in the category of “in the US”.
LatteLazy 4y ago
I agree Gansler are not doing their job. In this case, I think the CFTC (who seem to do more and make fewer speeches than Gansler) are doing good work though: Investors helped SBF commit his fraud, they funded it, they advertised it and they endorsed it. They SHOULD face some repercussions. The level of negligence they showed is frankly breath-taking.

bdcravens 4y ago

FTX stole investors' funds. That's a far greater concern than unregistered securities.

namdnay 4y ago
The former usually follows the latter
throwawaycities 4y ago
Lucky for those investors the FTC’s investigation shows the funds/VCs handling their investments were negligent and breached their fiduciary duty by not conducting any due diligence. Time for those investors to sue the VCs/funds.
- cactusplant7374 4y ago
  Looking forward to the depositions.
deleted 4y ago
[deleted]

nickpinkston 4y ago

Yea, this is more of a story of SBF and other crypto elites making a lot of donations to wealthy politicians, media companies, etc. who were hesitant to investigate them. Bloomberg apparently was presented evidence of the FTX fraud many months before its downfall which it didn't cover because it was bad for business. [1] This was also what happened in the Madoff case where outside investigators discovered the fraud and sent their pile of evidence to the Feds, who sat on it for years as the fraud expanded. [2] I bet we'll eventually see messages from SBF & Co. talking about Madoff specifically as a model for the scheme. [1] https://www.youtube.com/watch?v=qXzvVRw_Qgw https://www.youtube.com/watch?v=qXzvVRw_Qgw [2] https://en.wikipedia.org/wiki/Harry_Markopolos#Madoff_investigation https://en.wikipedia.org/wiki/Harry_Markopolos#Madoff_invest...

ejstronge 4y ago
It is hard to believe the claim in the video that ‘5 crypto ladies’ at Bloomberg passed on this enormous story absent evidence from the speaker. Regarding Madoff, there were indeed investigations after some of the complaints. Notably, these situations differ in that Madoff was a respected figure within the regulatory apparatus (but it’s hard to imagine that SBF holds sway over the editorial process at Bloomberg). It is true that the investigations into Madoff were ineffectual, at least according to reports I have seen
- nickpinkston 4y ago
  Yea, that's why I linked to the video (re: source is a single witness), but also SBF was definitely a powerful guy almost to the degree Madoff was, and we already see publications like the NY Times covering for SBF [1], so I don't see that as a big jump. I have a personal journalist friend whose editors didn't let them cover Theranos before the WSJ broke the news for similar reasons, so it's not out of the question. Not to mention the regulatory apparatus and Congressional inaction. [2] [1] https://www.youtube.com/watch?v=UqDJ6Ph8r9o https://www.youtube.com/watch?v=UqDJ6Ph8r9o [2] https://fortune.com/2022/11/10/ftx-crypto-collapse-binance-congress-regulation-sbf/ https://fortune.com/2022/11/10/ftx-crypto-collapse-binance-c...

dragonwriter 4y ago

> FTX is an offshore company, FTX.US is not

throw03172019 4y ago
OP listed FTX US in the category of “in the US”.

LatteLazy 4y ago

I agree Gansler are not doing their job. In this case, I think the CFTC (who seem to do more and make fewer speeches than Gansler) are doing good work though: Investors helped SBF commit his fraud, they funded it, they advertised it and they endorsed it. They SHOULD face some repercussions. The level of negligence they showed is frankly breath-taking.