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25 years in jail for returning +50% to his customers that he (unduly) treated as LPs suddenly seems too much…

by dotcoma 2y ago

questime 2y ago
If you take your investor's money and bet it on black at a roulette table and win, you'll still go to jail.
- dotcoma 2y ago
  Yes, that’s what the judge said. But too many people compared SBF to Bernie Madoff, and the more we learn about the FTX case, the less the comparison makes sense.
  - skullone 2y ago
    It still makes sense. They went bankrupt (because they literally ran out of money, they could no longer process withdrawals and billions was missing, it got put into receivership, and good to best outcome was achieved. This is not vindication of SBF or FTX, they sunk and were saved
  - questime 2y ago
    I agree comparisons aren't useful - but consider the fact that Madoff screwed over accredited investors, institutions and generally very rich people. SBF messed with customer deposits of a million retail investors - he was going to be made an example of.
- deleted 2y ago
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deleted 2y ago
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arkis22 2y ago
>FTX added that a jump in crypto prices since the company failed had not given its finances a major boost. It said almost all of the Bitcoin and other digital currencies believed to have been held by the exchange at the time of its collapse were missing. >The price of the biggest cryptocurrency, Bitcoin, has risen by around 270% since the firm filed for bankruptcy more than a year and a half ago. the problem with your logic is that it misunderstands what theft is because you are looking nominal value instead of opportunity cost. he took peoples money, he gambled it, and theyre generally going to get back a little more than the nominal value of their claims.
- dotcoma 2y ago
  I am not saying what they did was right, nor that is was wise. It was wrong and it was dumb, and they gambled a company in theory worth $ 40 B, at least according to some geniuses at VC funds, and his reputation and freedom. But the goal was not to steal money; had the goal been to steal money, they would have been successful in doing so. The goal was to gamble it with their hedge fund and use the profits for causes they deemed right. Again, this does not make his mistakes lighter. Lastly, people who deposited their hard earned money in an account owned by Alameda Research, SBF’s hedge fund, in order to have it available on FTX (yes, this was the standard procedure) are imho also partly to blame for the mess.
solumunus 2y ago
If someone steals an asset from you, which then goes on to triple in value, you should still be furious even if you were compensated the $ value at the point it was stolen. It’s like putting huge amounts of money into a pension fund for decades, your wealth grows massively, then you discover the whole pension scheme was a fraud and you’re returned the original amount you deposited decades ago. People should be happy with this outcome?
foogazi 2y ago
can a thief, once caught, avoid punishment by returning the value of the stolen property ?
- Crosseye_Jack 2y ago
  And he is not the one “returning” it, it is the bankruptcy administration. So (imo) it’s like saying if a thief can avoid punishment if the police return the value of the stolen property 2 years later at the value of the property 2 years prior. You are still “down” the 2 years of not having that property, and the uncertainty that being able to recoup anything.
- more_corn 2y ago
  Nope, that’s justice. Thief goes to prison. Justice department returns stolen funds.
joshstrange 2y ago
Where are you getting “returning +50%” from? The money over the $11B isn’t going to the customers, they are only getting the cash value of their crypto when FTX went under, when crypto was in a slump.

25 years in jail for returning +50% to his customers that he (unduly) treated as LPs suddenly seems too much…

questime 2y ago

If you take your investor's money and bet it on black at a roulette table and win, you'll still go to jail.

dotcoma 2y ago
Yes, that’s what the judge said. But too many people compared SBF to Bernie Madoff, and the more we learn about the FTX case, the less the comparison makes sense.
- skullone 2y ago
  It still makes sense. They went bankrupt (because they literally ran out of money, they could no longer process withdrawals and billions was missing, it got put into receivership, and good to best outcome was achieved. This is not vindication of SBF or FTX, they sunk and were saved
- questime 2y ago
  I agree comparisons aren't useful - but consider the fact that Madoff screwed over accredited investors, institutions and generally very rich people. SBF messed with customer deposits of a million retail investors - he was going to be made an example of.
deleted 2y ago
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deleted 2y ago

[deleted]

arkis22 2y ago

>FTX added that a jump in crypto prices since the company failed had not given its finances a major boost. It said almost all of the Bitcoin and other digital currencies believed to have been held by the exchange at the time of its collapse were missing. >The price of the biggest cryptocurrency, Bitcoin, has risen by around 270% since the firm filed for bankruptcy more than a year and a half ago. the problem with your logic is that it misunderstands what theft is because you are looking nominal value instead of opportunity cost. he took peoples money, he gambled it, and theyre generally going to get back a little more than the nominal value of their claims.

dotcoma 2y ago
I am not saying what they did was right, nor that is was wise. It was wrong and it was dumb, and they gambled a company in theory worth $ 40 B, at least according to some geniuses at VC funds, and his reputation and freedom. But the goal was not to steal money; had the goal been to steal money, they would have been successful in doing so. The goal was to gamble it with their hedge fund and use the profits for causes they deemed right. Again, this does not make his mistakes lighter. Lastly, people who deposited their hard earned money in an account owned by Alameda Research, SBF’s hedge fund, in order to have it available on FTX (yes, this was the standard procedure) are imho also partly to blame for the mess.

solumunus 2y ago

If someone steals an asset from you, which then goes on to triple in value, you should still be furious even if you were compensated the $ value at the point it was stolen. It’s like putting huge amounts of money into a pension fund for decades, your wealth grows massively, then you discover the whole pension scheme was a fraud and you’re returned the original amount you deposited decades ago. People should be happy with this outcome?

foogazi 2y ago

can a thief, once caught, avoid punishment by returning the value of the stolen property ?

Crosseye_Jack 2y ago
And he is not the one “returning” it, it is the bankruptcy administration. So (imo) it’s like saying if a thief can avoid punishment if the police return the value of the stolen property 2 years later at the value of the property 2 years prior. You are still “down” the 2 years of not having that property, and the uncertainty that being able to recoup anything.
more_corn 2y ago
Nope, that’s justice. Thief goes to prison. Justice department returns stolen funds.

joshstrange 2y ago

Where are you getting “returning +50%” from? The money over the $11B isn’t going to the customers, they are only getting the cash value of their crypto when FTX went under, when crypto was in a slump.