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FTX to file for U.S. bankruptcy, CEO resigns

reuters.com

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Re: FTX to file for U.S. bankruptcy, CEO resigns

#211

Post by tppiotrowski »

CraigRood wrote: post #172
pavlov wrote: post #128

Earlier quoted context omitted.

These days owning a crypto exchange is a shell game where you try to hide the funds and liabilities into a chain of companies located in offshore jurisdictions. Binance does the same but even more extreme — they don’t even tell where their HQ is actually located. Money launderers and tax evaders have long used these tricks. Those people don’t normally get VC capital at $34 billion valuations though. The crypto implos…

I'm really skeptical of Binance, whilst I would never accuse them of anything specific, I have no proof. Their structure, governance and business model combined with their refusal to meet basic regulatory requirements makes me feel uneasy.

All day I've been seeing reserve audit posts from all the crypto companies. To me this also screams "Please don't make a run on us or we're screwed"

Re: FTX to file for U.S. bankruptcy, CEO resigns

#212

Post by [deleted] »

randomsearch wrote: post #195
sillysaurusx wrote: post #3

Does this bankruptcy include FTX US? A bunch of people in yesterday’s thread were saying that FTX US is safe, which seemed strange.

Just bumping this up from comment below: >> This was about FTX International. FTX US, the US based exchange that accepts Americans, was not financially impacted by this shitshow. > https://twitter.com/SBF_FTX/status/1590709195892195329 So, SBF seems likely to have flat-out lied, right up to the last moment. At this point, why would you choose to trust any crypto company that wasn't perfectly transparent in how it hol…

[deleted]

Re: FTX to file for U.S. bankruptcy, CEO resigns

#213

Post by chewz »

WXLCKNO wrote: post #137
rippercushions wrote: post #91

Earlier quoted context omitted.

Gaze on the beauty of this chart and despair: https://i.redd.it/078p4g7m6cz91.jpg

Is this just the natural outcome of running a multi billion dollar crypto business? Do you hire so many experts and lawyers that they set this up for you as an ideal structure? Seeing how stupid/greedy SBF was, it makes me wonder if people like him are smart enough to truly understand the need for such structure without having experts in place.

You need that many companies trading with each other to create value and muddle the waters... Intangible assests and future flows passed from one entity to the other and priced at some unrealistic assumptions create/raise paper value.

This is how you blow the ballon...

Re: FTX to file for U.S. bankruptcy, CEO resigns

#214

Post by gjsman-1000 »

vnchr wrote: post #161
gjsman-1000 wrote: post #107

Earlier quoted context omitted.

Yes. There are whole articles online (by both sides) about how he became a critical Democratic party supporter almost overnight. According to MarketWatch, he was the second largest donor to the Democrat Party. Good for him I guess that Dems did well in the election. Though, I would love an independent probe to ensure there's no quid pro quo.

Your hypothesis is the second largest donor to the Democrat Party gave without expectation of quid pro quo?

I didn't try to suggest it because HN would probably downvote me to oblivion if I did. I personally, however, think that a quid pro quo is pretty likely - and Republicans would shout this from the rooftops if they had a little more sense in my opinion. Stealing a ton of money, giving a ton to Democrats, potentially helping win an election, and then not investigating or properly punishing the thief is a perfect crime... so, if I am the Dems, I would throw or at least try to get 150+ years in prison Madoff-style at a minimum.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#215

Post by pavlov »

CraigRood wrote: post #172
pavlov wrote: post #128

Earlier quoted context omitted.

These days owning a crypto exchange is a shell game where you try to hide the funds and liabilities into a chain of companies located in offshore jurisdictions. Binance does the same but even more extreme — they don’t even tell where their HQ is actually located. Money launderers and tax evaders have long used these tricks. Those people don’t normally get VC capital at $34 billion valuations though. The crypto implos…

I'm really skeptical of Binance, whilst I would never accuse them of anything specific, I have no proof. Their structure, governance and business model combined with their refusal to meet basic regulatory requirements makes me feel uneasy.

Binance is effectively saying “I’m not going to tell you where I am but you should let me manage your money.” It takes a special kind of gullibility to accept that, but in the crypto world left has been right and black white for a very long time.

Binance’s US subsidiary is just as safe as FTX.US was, despite their claims otherwise. It will fall along with the other dominos.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#216

Post by memish »

throwaway0asd wrote: post #121

Where were the adults in any of this and why would people throw billions of dollars at unqualified children?

Like Elizabeth Holmes, they are kids of the elite who are well connected and supported at high levels. Further, SBF is one of the biggest political donors and there may be corruption in the SEC. The general counsel of FTX US had served as lead counsel to Chairman Gensler at the CFTC.

And then there's this from a congressman yesterday, "@GaryGensler runs to the media while reports to my office allege he was helping SBF and FTX work on legal loopholes to obtain a regulatory monopoly. We're looking into this." https://twitter.com/RepTomEmmer/status/1590717374801809409

Re: FTX to file for U.S. bankruptcy, CEO resigns

#217

Post by pvg »

randomsearch wrote: post #195
sillysaurusx wrote: post #3

Does this bankruptcy include FTX US? A bunch of people in yesterday’s thread were saying that FTX US is safe, which seemed strange.

Just bumping this up from comment below: >> This was about FTX International. FTX US, the US based exchange that accepts Americans, was not financially impacted by this shitshow. > https://twitter.com/SBF_FTX/status/1590709195892195329 So, SBF seems likely to have flat-out lied, right up to the last moment. At this point, why would you choose to trust any crypto company that wasn't perfectly transparent in how it hol…

Just bumping this

Don't do this on HN please.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#218

Post by jnwatson »

digerata wrote: post #40
Kiro wrote: post #34

Earlier quoted context omitted.

He already lost his whole net worth overnight ($16B) and will live in hiding with serious death threats for the rest of his life. This is no ordinary CEO switcheroo where the he walks away with a slap on the wrist and a golden handshake.

He was running a Ponzi scheme. Don't feel sorry for him.

It wasn’t a Ponzi scheme, at least based on what’s publicly known.

This is just investing with client funds, which the US learned the hard way must be carefully restricted. The US has the Glass-Steagall Act, and deposit insurance to try to prevent bank runs like this.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#219

Post by purple_ferret »

ransom1538 wrote: post #143

Anyone here able to do a tl;dr; for us? The FTX story is super confusing. Why are they screwed? What happened?

here's the way I understand it:

-SBF's other pet project Alameda Research suffered huge loses after Luna blew up.

-Alameda Research, a 'backer' of FTX was given billions of FTT tokens that they 'owned' by FTX because they participated in its 'ICO', transferred it FTX, and then used it as collateral to 'borrow' FTX user assets, hoping they could gamble with it and make back their money.

CZ, of Binance, got wind of this somehow, and holding billions of FTT on Binance, decided to tank the price by saying it will all be sold immediately

-SBF gets caught with his pants down

Re: FTX to file for U.S. bankruptcy, CEO resigns

#220

Post by vgatherps »

AustinDev wrote: post #156
yourMaster_666 wrote: post #66

you cannot make up this shit https://www.reddit.com/r/wallstreetbets/comments/ys4lmo/she_... gold

Wow... I thought this was satire. (when talking about trading) 'We don't tend to have stop losses, we don't see those as very good risk management tools' No wonder they're bankrupt... SBF loaned her company 10 billion to trade without basic risk management for trading.

She’s not wrong, stop losses are pretty pointless if you’re running a high volume market maker that is in theory constantly doing tons of volume and reacting to updates.

They’re also super dangerous if you have gigantic positions

Anyways they wouldn’t save you from collateralizing your loans with shitcoins, taking leveraged bets with money that isn’t yours, having super high exposure to UST and/or Luna, exposed to hackable defi products. Harder things that “having a good sense for risk” usually entails thinking about.

The real red flags are claiming she doesn’t use math and that she’s never lost a lot of money on a trade despite doing largely human informed trading for size…

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