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We will not pursue the potential acquisition of FTX

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Re: We will not pursue the potential acquisition of FTX

#21

Post by nightski »

alexk307 wrote: post #10

Maybe people will finally get some sense and stop storing their wealth in digital currency that is backed by absolutely nothing. I think a lot of dominoes are about to fall in the crypto world

Do you typically invest all of your wealth in one thing? Because for most of us I imagine that is not the case.

Re: We will not pursue the potential acquisition of FTX

#22

Post by cannaceo »

snowypine wrote: post #5

Wow, after only one day of due diligence.

My personal belief is that binance agreed with no intention to carry out the deal. CZ tapdanced on FTX's grave on twitter with critical comments yesterday. It is now unlikely that anyone else will want to step up to look at the deal.

Re: We will not pursue the potential acquisition of FTX

#23

Post by mumbisChungo »

The silly thing is that FTX was a money printing machine. There was no reason to start gambling with user funds, aside from greed, hubris, and stupidity.

Similarly, Sam's fund Alameda was delta-neutral until some time in 2021, which is something that also could have profitably continued in perpetuity, but they got greedy and started making directional bets with leverage.

Re: We will not pursue the potential acquisition of FTX

#25

Post by scottiebarnes »

alexk307 wrote: post #10

Maybe people will finally get some sense and stop storing their wealth in digital currency that is backed by absolutely nothing. I think a lot of dominoes are about to fall in the crypto world

The Bitcoin protocol and network continues to operate exactly as expected. Here, people trusted a "bank" (an exchange acting like a bank), and got burned when the bank gambled and lost.

Re: We will not pursue the potential acquisition of FTX

#26

Post by jefftk »

tommica wrote: post #6

Why waste money on something that is burning out anyways? Also conveniently mentioning "potential", they really want to make sure people understand that there never was anything binding going on.

If FTX was at least close to solvent it could have been worth acquiring for the customer relationships.

Re: We will not pursue the potential acquisition of FTX

#27

Post by pearjuice »

No surprise whatsoever. They killed a competitor, avoided being on the hook for ~$6B in missing funds and without paying anything they are basically inheriting all FTX customers still happy to trade crypto. FTX or whatever is left will be under massive legal scrutiny for years to come. The "institutional investors" they were attracting and lobbying for are the kind of folks you don't want legal battles with.

Meanwhile, FTX is still operating (!), accepting new users and accepting customer deposits even though it is insolvent. If you haven't been following the crypto news much or aren't on Twitter, you will have received ZERO direct communication from FTX that they are insolvent (not even an email). This is coming from someone who went on the record[0] trying to lobby, blaming the financial industry for lack of transparency and taking on too much risk and publicly lying that FTX doesn't use customer funds to trade (tweets have since been deleted)[1]

[0] https://twitter.com/HaloCrypto/status/1590417311839981569

[1] https://cointelegraph.com/news/ftx-founder-sam-bankman-fried...

Re: We will not pursue the potential acquisition of FTX

#28

Post by ignoramous »

wellthatsawrap1 wrote: post #4
WJW wrote: post #2

Extremely interesting to see how this will end. IIRC, Alameda research had a huge position in FTT which will presumably go under now.

Hopefully with jail time

If and after cryptocurrency becomes deeply intertwined with the economy (like Banks), I wonder bailouts would be the norm besides relatively inconsequential jail times?

I wonder what's going on / will happen in countries where governments (or citizens en masse) have endorsed / adopted cryptocurrencies?

Re: We will not pursue the potential acquisition of FTX

#29

Post by warinukraine »

JumpCrisscross wrote: post #13

In the thick of it, illiquidity and insolvency blur. But not after the fact. As usual, Levine put it best: “the problem is not a timing mismatch, in which FTX’s customers asked for their cash back but FTX did not have enough ready cash because it had long-term but money-good loans out. The problem is that FTX took its customers’ money and traded it for a pile of magic beans, and now the beans are worthless and there’…

Hah I called them magic beans yesterday!

https://news.ycombinator.com/item?id=33524912

Re: We will not pursue the potential acquisition of FTX

#30

Post by sytelus »

alexk307 wrote: post #10

Maybe people will finally get some sense and stop storing their wealth in digital currency that is backed by absolutely nothing. I think a lot of dominoes are about to fall in the crypto world

At present no major currency is backed by anything material but trust. USD, for example, is only viable because, at the deepest level, trust in it is enforced by US army. There are three major class of people who need digital currency: (1) who are super rich and won't care about putting their 1% of wealth for "diversify and forget", (2) who need to transfer money eyes off from governments, (3) people who need alternative to be manipulated away from US fed. As long as there exist a group of people needing digital currency there is an intrinsic value assigned to that currency.
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