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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

#41

Post by sgt101 »

warinukraine wrote: post #29
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

We've been here a long time ago : https://en.wikipedia.org/wiki/Beenz.com

Re: We will not pursue the potential acquisition of FTX

#42

Post by PaulWaldman »

mumbisChungo wrote: post #23

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.

>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.

Where were their profits derived? Was it from taking their slice of every transaction? Or selling their freshly minted coins? If it was the latter, that only works for so long, just ask the Fed.

Re: We will not pursue the potential acquisition of FTX

#43

Post by jonstewart »

sytelus wrote: post #30
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 alterna…

> trust in it is enforced by the US army

That's not exactly "absolutely nothing", to use the parent's phrase.

Re: We will not pursue the potential acquisition of FTX

#44

Post by sytelus »

scottiebarnes wrote: post #25
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.

Without exchanges like FTX or Coinbase, how should general public acquire crypto?

Re: We will not pursue the potential acquisition of FTX

#45

Post by eddsh1994 »

shmatt wrote: post #32

CZ knew about the bad leverage to begin with, which is why he tweeted about selling all of the FTT What are the chances he never intended to buy FTX, just to destroy it after their public back and forth? It's almost like a reverse Musk - he sent a purchase offer with an option to back out no matter what CZ knew from day 1 all he needed to do was crash FTT just enough, and the rest would happen organically

I called it and saw many others call it too. Cause a run on FTX, get due diligence and say it’s F**ed, and get their user-base for free.

My concern is how much funding FTX and SBF in particular were giving to EA/AGI Safety research labs and charities. There’s going to be some significant knock on effects there when the money is no longer available.

Re: We will not pursue the potential acquisition of FTX

#46

Post by kuratkull »

shmatt wrote: post #32

CZ knew about the bad leverage to begin with, which is why he tweeted about selling all of the FTT What are the chances he never intended to buy FTX, just to destroy it after their public back and forth? It's almost like a reverse Musk - he sent a purchase offer with an option to back out no matter what CZ knew from day 1 all he needed to do was crash FTT just enough, and the rest would happen organically

Seems pretty likely. The moment FTX publicly accepted the buyout idea they were doomed as a company, it wouldn't have mattered if Binance actually bought them after that.

Re: We will not pursue the potential acquisition of FTX

#47

Post by maxerickson »

ricardou wrote: post #33

This whole thing is such a mess. Binance's statement is quite scathing. It is a shame that crypto institutions continue to fold after mismanagement. The free money era will sure take a couple more entities with it.

Maybe organizations is a better word there.

Re: We will not pursue the potential acquisition of FTX

#48

Post by _jal »

scottiebarnes wrote: post #25
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.

> continues to operate exactly as expected

Yep: as a set of primitives on which to build sorting mechanisms for fools and money.

Re: We will not pursue the potential acquisition of FTX

#50

Post by pearjuice »

ignoramous wrote: post #34
cannaceo wrote: post #22

Earlier quoted context omitted.

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.

I'd say Stripe but unlikely given their missed IPO window. Perhaps, Amazon, if they are feeling lucky?

My prediction: nobody will touch FTX and whatever is left of it will be in legal battles for years to come. Most will get auctioned to recoup the big fish making the most noise and maybe pennies after that for individual users which had funds on FTX. There is near zero value in an exchange-brand which took a reputational hit as big as this.
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