271–280 of 746 posts
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It does, but those investors were breaking FTX ToS by using the site (you had to use a VPN to access it). I'm not sure if the SEC has standing for American investors that pretended to not be American.
Sorry, I mean investors in the company itself, not crypto traders.
[1] https://twitter.com/sequoia/status/1590522718650499073/photo...
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While you're correct[0], still the FDIC is guaranteeing it up to $250k. [0]: https://www.federalreserve.gov/monetarypolicy/reservereq.htm
Right, but the FDIC explicitly says large amounts may take longer in the status quo. The only reason to have money in the bank is for a reasonably safe, liquid form of money. If they aren’t providing safety or liquidity, why should you use them?
The safety is personal — no one can rob your home when you're gone and steal the money under your mattress because it's not under there, it's in a bank.
And in regards to liquidity, if you can tell me the exact day, time, and amount you tried to pull out of a consumer bank (large household bank names) and instead of getting cash in hand the bank told you "sorry, we spent your money on loans, we don't have any to give you", I'd love to see it.
Bonus points if then the FDIC didn't cover it.
Banks provide both safety and liquidity at the consumer level. It would also be a really bad idea to continue to encourage everyone to pull money out of banks and hold it in cash — both economically and personally. People largely benefit from banks existing, that's, well, why they exist!
Greed in this space causes people to act with a more short term view for quick profits while ignoring fundamentals. Over and over again.
You know those corner stores that act as Western Union/Moneygram agents? They have to follow stronger regulations (KYC/AML/BSA) and are audited on a quarterly basis by WU/MG to ensure there is no co-mingling of funds. A bodega conducts better financial oversight than these masters of the cryptoverse.
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While you're correct[0], still the FDIC is guaranteeing it up to $250k. [0]: https://www.federalreserve.gov/monetarypolicy/reservereq.htm
It may be that what the FDIC promises to do is not in sync with what it can actually afford to do.
I think they've got enough to cover any consumer issues.
[0]: https://www.fdic.gov/about/strategic-plans/strategic/insuran...
[1]: https://en.wikipedia.org/wiki/Federal_Deposit_Insurance_Corp...
I highly recommend reading this article, from 50 days ago . So many humorous quotes to be had in that article. https://www.sequoiacap.com/article/sam-bankman-fried-spotlig... edit: archive https://archive.ph/GQkCp
> That’s when SBF told Sequoia about the so-called super-app: “I want FTX to be a place where you can do anything you want with your next dollar. You can buy bitcoin. You can send money in whatever currency to any friend anywhere in the world. You can buy a banana. You can do anything you want with your money from inside FTX.”
> Suddenly, the chat window on Sequoia’s side of the Zoom lights up with partners freaking out.
> “I LOVE THIS FOUNDER,” typed one partner.
> “I am a 10 out of 10,” pinged another.
> “YES!!!” exclaimed a third.
> What Sequoia was reacting to was the scale of SBF’s vision. It wasn’t a story about how we might use fintech in the future, or crypto, or a new kind of bank. It was a vision about the future of money itself—with a total addressable market of every person on the entire planet.
> “I sit ten feet from him, and I walked over, thinking, Oh, shit, that was really good,” remembers Arora. “And it turns out that that fucker was playing League of Legends through the entire meeting.”
Lo and behold. The intricate, behind-the-scenes scheming of the highly educated financial elite, revelead at last. All predicated upon the grand vision of... buying a banana with your "super-app". No wonder we're going through a much needed correction, some people need to be weeded out of decision making roles ASAP.
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It may be that what the FDIC promises to do is not in sync with what it can actually afford to do.
The FDIC, as of March 2021, has 119.4 billion[0], along with "... a US$100 billion line of credit with the United States Department of the Treasury.[9]"[1]. I think they've got enough to cover any consumer issues. [0]: https://www.fdic.gov/about/strategic-plans/strategic/insuran... [1]: https://en.wikipedia.org/wiki/Federal_Deposit_Insurance_Corp...
From the article: "FTX Chief Executive Sam Bankman-Fried said in investor meetings this week that Alameda owes FTX about $10 billion, people familiar with the matter said. FTX extended loans to Alameda using money that customers had deposited on the exchange for trading purposes, a decision that Mr. Bankman-Fried described as a poor judgment call, one of the people said." In the FTX International terms of service ( h…
So if the chain is supposed to enable "trustless" finance, what enabled Alameda to take anything? Seems Alameda and its clients should be screwed, but FTX's holders should be relatively easy to identify and restore. But everyone seems to say that's not the case. So what broke down here? Why isn't the ledger ledgering?
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SEC only enforces the law via civil means, so they do not do handcuffs. Handcuffs would be FBI territory.
Ehhh, that's misleading. The SEC often files enforcement actions directly with the DOJ and the SEC attorneys are often dual-hatted as SAUSAs.