4 ms·

I struggle to see the issue with the headline, this is how bankruptcy works, it's how they would usually report in relation to creditors.

norswap 2y ago
I don't know how bankruptcy documents work, but this is not a filling, it's a general-audience article. The truth is if you had one Bitcoin in FTX, that was worth 20k. You might have bought for more or less than that. Now it's worth 60k. You didn't get the 20k back immediately (in which case you could have repurchased the Bitcoin immediately and not lose anything). - If you bought Bitcoin above 20k, you lost money, whereas you wouldn't have otherwise. - If you would have kept your Bitcoin, you would have 60k now. You didn't get a choice in the matter. The problem if of course "what is money" — the thing you owned was a Bitcoin, and now you're getting back its value from back then in dollar terms. This value changed meanwhile, shocking! But quite clearly, most people would have had more money now if that hadn't happened. So while it's possible that some people would have sold lower than 24k (it didn't stay that low very long), most people wouldn't have, and so they lost money, in the commonly accepted undertanding. Imagine the government seized your house 10 years ago, then paid you back today its price from 10 years ago +20%. Did you not lose money?
- deleted 2y ago
  [deleted]
- Sakos 2y ago
  This is such a bad faith argument. Imagine you put up your house as an investment into some crypto exchange and the exchange goes bankrupt because it turns out they're misusing customer funds and defrauding their customers. You'll get your house back when legal proceedings are done. What value that house has before or after is sort of irrelevant except as a way for you to twist the issue to fit your narrative. Nobody made you put up your house in some nonsense crypto exchange. That was you. Be glad the government is involved at all or you might not be getting anything back.
  - jimmydddd 2y ago
    But what if instead of getting your house back, you're only getting the cash equivalent of what your house was worth THEN, plus some interest. Meanwhile, your house, which you no longer own, has tripled in value.
    - SR2Z 2y ago
      This is unironically the reason why stock trading is so heavily regulated. If you looked at Bitcoin, whose entire pitch is that it's a poorly regulated speculative instrument, and thought "I'm going to put my house in this" you are an adult accepting unreasonable levels of risk. Just because FTX (predictably) was run by a con man who got his whole company shut down DOESN'T MEAN that you're a victim. You gambled money you didn't have on a system you didn't care to understand and you are lucky to even get the money back.
  - Suppafly 2y ago
    >Be glad the government is involved at all or you might not be getting anything back. This. I'm constantly surprised that the government helps people in these situations. If they want the government to be involved, they should push for crypto to actually follow all of the laws that apply to traditional financial things, which would eliminate a lot of these scams that end up requiring government intervention in the first place.
    - throw49sjwo1 2y ago
      That's the job of a government, and why would people fund it through taxes if it doesn't do its job?
      - SR2Z 2y ago
        Because many people do not want the government to regulate crypto.
        throw49sjwo1 2y ago
sobellian 2y ago
During sentencing, SBF attempted to argue that creditors had experienced "zero harm" as even then it was apparent FTX would be able to pay them back. John Ray himself rebutted that argument: https://www.courtlistener.com/docket/66631292/415/united-states-v-bankman-fried/ https://www.courtlistener.com/docket/66631292/415/united-sta.... > And even taking into account the potential for achieving anticipated recovery levels, which is by no means assured, customers still will never be in the same position they would have been had they not crossed paths with Mr. Bankman-Fried and his so-called brand of “altruism.” The opportunity cost is real and cannot be ignored.
- KoolKat23 2y ago
  I'm not arguing that, it doesn't change the fact that a crime occured. I'm just saying the title is not misleading. They mentioned it is bankrupt and by definition creditor rights are curtailed.
  - sobellian 2y ago
    To the common man, "made money" and "experienced economic harm" would contradict each other. In that way the title misleads.
    - KoolKat23 2y ago
      They mentioned it is bankrupt and by definition creditor rights are curtailed.
      - sobellian 2y ago
        Okay? I don't see how that makes it any less misleading. Compared to a universe where FTX did not go bankrupt, the creditors have much less money.
        KoolKat23 2y ago
        They have made more money than they invested. It is by definition a return on investment, not the return or timescale they envisaged but a return nonetheless i.e >100%. Effectively they invested $100, that investment dropped to $0 (while funds were locked away during bankruptcy), and now they're worth $119. The headline is only notable as usually creditors do not get 100% of their initial capital back during a bankruptcy, nevermind over 100%.

norswap 2y ago

I don't know how bankruptcy documents work, but this is not a filling, it's a general-audience article. The truth is if you had one Bitcoin in FTX, that was worth 20k. You might have bought for more or less than that. Now it's worth 60k. You didn't get the 20k back immediately (in which case you could have repurchased the Bitcoin immediately and not lose anything). - If you bought Bitcoin above 20k, you lost money, whereas you wouldn't have otherwise. - If you would have kept your Bitcoin, you would have 60k now. You didn't get a choice in the matter. The problem if of course "what is money" — the thing you owned was a Bitcoin, and now you're getting back its value from back then in dollar terms. This value changed meanwhile, shocking! But quite clearly, most people would have had more money now if that hadn't happened. So while it's possible that some people would have sold lower than 24k (it didn't stay that low very long), most people wouldn't have, and so they lost money, in the commonly accepted undertanding. Imagine the government seized your house 10 years ago, then paid you back today its price from 10 years ago +20%. Did you not lose money?

deleted 2y ago
[deleted]
Sakos 2y ago
This is such a bad faith argument. Imagine you put up your house as an investment into some crypto exchange and the exchange goes bankrupt because it turns out they're misusing customer funds and defrauding their customers. You'll get your house back when legal proceedings are done. What value that house has before or after is sort of irrelevant except as a way for you to twist the issue to fit your narrative. Nobody made you put up your house in some nonsense crypto exchange. That was you. Be glad the government is involved at all or you might not be getting anything back.
- jimmydddd 2y ago
  But what if instead of getting your house back, you're only getting the cash equivalent of what your house was worth THEN, plus some interest. Meanwhile, your house, which you no longer own, has tripled in value.
  - SR2Z 2y ago
    This is unironically the reason why stock trading is so heavily regulated. If you looked at Bitcoin, whose entire pitch is that it's a poorly regulated speculative instrument, and thought "I'm going to put my house in this" you are an adult accepting unreasonable levels of risk. Just because FTX (predictably) was run by a con man who got his whole company shut down DOESN'T MEAN that you're a victim. You gambled money you didn't have on a system you didn't care to understand and you are lucky to even get the money back.
- Suppafly 2y ago
  >Be glad the government is involved at all or you might not be getting anything back. This. I'm constantly surprised that the government helps people in these situations. If they want the government to be involved, they should push for crypto to actually follow all of the laws that apply to traditional financial things, which would eliminate a lot of these scams that end up requiring government intervention in the first place.
  - throw49sjwo1 2y ago
    That's the job of a government, and why would people fund it through taxes if it doesn't do its job?
    - SR2Z 2y ago
      Because many people do not want the government to regulate crypto.
      - throw49sjwo1 2y ago

sobellian 2y ago

During sentencing, SBF attempted to argue that creditors had experienced "zero harm" as even then it was apparent FTX would be able to pay them back. John Ray himself rebutted that argument: https://www.courtlistener.com/docket/66631292/415/united-states-v-bankman-fried/ https://www.courtlistener.com/docket/66631292/415/united-sta.... > And even taking into account the potential for achieving anticipated recovery levels, which is by no means assured, customers still will never be in the same position they would have been had they not crossed paths with Mr. Bankman-Fried and his so-called brand of “altruism.” The opportunity cost is real and cannot be ignored.

KoolKat23 2y ago
I'm not arguing that, it doesn't change the fact that a crime occured. I'm just saying the title is not misleading. They mentioned it is bankrupt and by definition creditor rights are curtailed.
- sobellian 2y ago
  To the common man, "made money" and "experienced economic harm" would contradict each other. In that way the title misleads.
  - KoolKat23 2y ago
    They mentioned it is bankrupt and by definition creditor rights are curtailed.
    - sobellian 2y ago
      Okay? I don't see how that makes it any less misleading. Compared to a universe where FTX did not go bankrupt, the creditors have much less money.
      - KoolKat23 2y ago
        They have made more money than they invested. It is by definition a return on investment, not the return or timescale they envisaged but a return nonetheless i.e >100%. Effectively they invested $100, that investment dropped to $0 (while funds were locked away during bankruptcy), and now they're worth $119. The headline is only notable as usually creditors do not get 100% of their initial capital back during a bankruptcy, nevermind over 100%.