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Binance to acquire FTX

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Re: Binance to acquire FTX

#741

Post by [deleted] »

eru wrote: post #660
stale2002 wrote: post #658

Earlier quoted context omitted.

Which is exactly the problem. This should be illegal, and people who do this should go to jail. Customer funds should be 1 to 1 backed with assets.

As long as noone is being lied to, I don't see any problems. Case A, tell your customers that their funds have asset backing, and have asset backing: fine. Case B: tell your customers that their funds have no asset backing, and have no asset backing: fine. (Those customers deserve what they get.) Case C: tell your customers nothing, and do whatever you feel like: fine. (Those customers deserve what they get.) Case D:…

[deleted]

Re: Binance to acquire FTX

#742

Post by SilasX »

nl wrote: post #486
SilasX wrote: post #390

Earlier quoted context omitted.

1) What is that replying to? I was asking why the borrowed FTT would make them more capable of getting loans if it came with a corresponding liability. That would only make sense if lenders didn't care about the liability balance sheet, which is ... non standard. Edit: That is, you said the "size of the asset balance" is used to obtain loans. That makes it sound like merely increasing assets -- even if they come with…

There are DeFi protocols where you can lock-up crypto assets (eg FTT) and use those locked assets as collateral to borrow another crypto asset (eg ETH). That all happens "on chain" and there is no way for the protocol to know if there are corresponding balance sheet liabilities. I don't know what the OP was referring to, and I don't know if this is what they were doing, but something like this could happen.

Right, but those are generally going to be on worse terms than you can get in a negotiated loan from someone who knows your entire business. So it doesn’t make much sense to negotiate an FTT loan and then use that as collateral for a less-informed loan from a smart contract.

It would be like getting a personal loan from a bank, buying jewelry with it, and then using the jewelry to get a pawn loan — a dubious strategy, since the terms on the first loan are going to be much better.

Re: Binance to acquire FTX

#743

Post by xur17 »

shapefrog wrote: post #709
xur17 wrote: post #647

Earlier quoted context omitted.

Taking that a step further, is Binance doing the same thing?

Without wanting to overdo the "speedrunning 100 years of trad finance" crypto has just replayed 2008. FTX is playin the role of Bear Sterns and Binance playing JP Morgan. Defi are subbing in for Mortgage bonds, CDOs and synthetic CDOs squared. Margott Robbie can play herself again the the explanation https://www.youtube.com/watch?v=wlHrSZ7BVFI As with 2008, it is entirely possible that an exchange does what it is mea…

> No idea, CZ of binance tweets like he gets this, but who know.

Agreed. CZ has also posted that he intends to start publishing merkle-tree proof-of-reserves [0] for Binance. Definitely could be posturing, but if he follows through it would definitely raise the confidence in Binance.

[0] https://twitter.com/cz_binance/status/1590055819416330240

Re: Binance to acquire FTX

#744

Post by perlgeek »

wmf wrote: post #190
perlgeek wrote: post #124

Wasn't there a post hitting the HN front page just yesterday or two days ago about how FTX was close to being illiquid, and most of the top comments were about how wrong that analysis was? Or was that another crypto trader? If anybody could help my sieve-like brain, that would be very appreciated :-)

Yes, concerns about Alameda's insolvency infected FTX. In retrospect these "concerns" may have been disinfo designed to destroy FTX.

... or might have been a good prediction. An exchange shouldn't rely on public opinion for solvency.

Re: Binance to acquire FTX

#745

Post by Kbelicius »

googlryas wrote: post #357
3001 wrote: post #168

Earlier quoted context omitted.

Total unrelated but son of https://en.wikipedia.org/wiki/Olusegun_Obasanjo . Numero uno looter of Africa

Why even reference it then? We have understood that sins of the father are not the sins of the child since at least the book of exodus(~500BC). If that tweeter has done something wrong in his life, then talk about it. But he didn't really have a choice on who birthed him. From the wiki page: > Some of his children were resentful that he gave them no special privileges and treated their mothers poorly.

We have also understood that sins of the father are sins of the child since at least the book of genesis(~500BC).

Re: Binance to acquire FTX

#746

Post by chrischattin »

jl2718 wrote: post #606
hammock wrote: post #536

Earlier quoted context omitted.

This is my view as to what possibly happened in last 24 hours. Mind you I have no idea if its real but i am making an educated guess based on my 10+ yrs seeing such events play out several times. 1) Alameda used FTX money and balance sheet along with using $FTT to take out billions of loans and "investments" including possibly customer funds to "invest" "efficiently" into risky investments 2) He then also used a lot…

One missing piece: $1B BTC being auctioned by the IRS soon. This is such a big number that it will almost certainly be bought at a discount by an arbitrageur and liquidated on the market, so this was the impetus for the broad-market crash that killed their leveraged positions.

The 24hr BTC volume on Coinbase alone was $126B. The feds selling $1B won’t make much of a dent.

Re: Binance to acquire FTX

#747

Post by norswap »

microtherion wrote: post #497
kuratkull wrote: post #119

Binance was threatening to dump a huge amount of FTT tokens on the market. FTX has a big+vulnerable position in FTT. FTX asked Binance to sell them the tokens for a fixed price, so as not to crash the FTT token price. Binance declined - this was yesterday/today. Of course the price of FTT crashed today. And now Binance buys FTX to help them out... smells like Binance played 4D chess all along. https://decrypt.co/1136…

> Binance was threatening to dump a huge amount of FTT tokens on the market. FTX has a big+vulnerable position in FTT. FTX asked Binance to sell them the tokens for a fixed price, so as not to crash the FTT token price. Binance declined This makes absolutely no sense and is not how markets work. If FTX was actually willing to buy unlimited FTT at a given price, Binance could not have "crashed the price" by selling be…

Another problem is the bank run that this narrative created.

Re: Binance to acquire FTX

#748

Post by johnvanommen »

presentation wrote: post #527
johnvanommen wrote: post #473

Earlier quoted context omitted.

> FTX issues FTT tokens (print money) => lends to Alameda to put under the asset balance => Alameda borrows money from outside against its assets or uses the asset/coins to invest in others => win with thin air! The Federal Reserve issues US dollars (print money) => US Treasury borrows money from The Federal Reserve, Japan, China and the UK against its assets or uses the asset/coins to invest in others => win with th…

Yeah but the US can destroy you diplomatically, militarily, and economically if you try anything funny.

Of course! That's why it's so important for the US to encourage the use of the USD on a global basis, and also spend billions on the US Navy.

Re: Binance to acquire FTX

#749

Post by namaria »

jrm4 wrote: post #632
namaria wrote: post #441

Earlier quoted context omitted.

The thing created by a US Government agency at the height of the Cold War is your example of anarchist success story?

Yes, because I'm not talking about "how it came into existence," I'm using the actual textbook definition of the word.

There is a LOT of -archy overhead to the Internet.

Re: Binance to acquire FTX

#750

Post by chasebank »

perlgeek wrote: post #124

Wasn't there a post hitting the HN front page just yesterday or two days ago about how FTX was close to being illiquid, and most of the top comments were about how wrong that analysis was? Or was that another crypto trader? If anybody could help my sieve-like brain, that would be very appreciated :-)

Wow, usually the HN thread hindsight comes years after. That is quite a fascinating read.
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