So for "normal" financial institutions (eg banks, mutual funds, brokerages) you are legally required to shield custodian assets. They rea typically held in trust. Due to various scandals there's a lot of regulation. There's even government protection (to a point) for individual customers (eg FDIC insurance for bank depositors).
All of this is necessary to stop situations like FTX/Alameda. A bank can't take your money and bet it on blackjack but there seems to be no such protection for these crypto exchanges. All of this is necessary to maintain confidence in the financial system (yet another reason to roll one's eyes at libertarians).
I mention this because it's just another case of crypto lacking protections the non-crypto financial system has and ignoring lessons learned over the last 5000 years of finance.
I saw a comment on HN yesterday where someone in the Navy said that when they get a new CO it'll be one of two types: the first will work out how things work and then incrementally improve things. The second will immediately reshape everything in their image without figuring out why things are the way they are.
I see that trend in management too. But it seems to be a problem with the entire crypto space. Otherwise smart people completely ignorance of the financial systeem just reshaping crypto with no regard for history.
As for SBF, this is a fraud on a massive scale, like Madoff scale. I really wonder what will happen here because what should probably happen is he'd spend the rest of his life in prison.