FTX to file for U.S. bankruptcy, CEO resigns • Hacker News Board

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

#391

Post by paganel » Fri, Nov 11, 2022, 5:23 PM UTC

EVa5I7bHFq9mnYK wrote: post #334

memish wrote: post #322

Earlier quoted context omitted.

Here's another guy that was vouching for SBF to get in on the Twitter deal for $5b. Michael Grimes [IBanker at Morgan Stanley]: Do you have 5 minutes to connect on possible meeting tomorrow I believe you will want to take? Elon: Will call in about half an hour Michael: Sam Bankman Fried is why I'm calling https://twitter.com/sbf_ftx/status/1514588820641128452 https://www.vox.com/platform/amp/recode/2021/3/20/22335209…

Interesting, the banker thinks "Major Democratic donor" is a positive selling point for Musk. I thought he is red.

And finished it off with with “second to Bloomberg when donating to Biden”.

If any of this had happened in a non-rules based world or even at the periphery of our “civilized” world, a whole bunch of US-financed NGOs and “civil society” thingies would have been up all in arms about it, with cries of corruption and the like. But the moment when it turns out that the second largest financial donor to the US President is basically a crook and a fraudster all those voices are suddenly silent.

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

#392

Post by dig1 » Fri, Nov 11, 2022, 5:23 PM UTC

ljlolel wrote: post #84

ldjkfkdsjnv wrote: post #27

Earlier quoted context omitted.

This is actually generally how finance works though. The whole industry is built on the illusion of superior competence. "Prestige" is a determining factor in someones ability get a job running a hedge fund/financial asset management. Generally they need to have gone to the right school, worked at the right bank, then at the right hedge fund. Each should show a good amount of tenure ( > 3-5 years ). A major asset man…

I saw this at Bridgewater. Hired only ivy league, smart people actually. But their total discretionary control was a tiny % of fund. Hedge funds are mostly marketing. When 2008 financial crisis happened, Dalio was making the big trades in the control room himself on gut feel.

> Hedge funds are mostly marketing

This. Someone from Bridgewater mentioned that Dalio's "radical transparency" and all that we-record-everything nonsense is just a marketing bluff. Actual decisions are made behind closed doors by a few people.

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

#393

Post by jasonwatkinspdx » Fri, Nov 11, 2022, 5:24 PM UTC

pmoriarty wrote: post #63

ldjkfkdsjnv wrote: post #27

Earlier quoted context omitted.

This is actually generally how finance works though. The whole industry is built on the illusion of superior competence. "Prestige" is a determining factor in someones ability get a job running a hedge fund/financial asset management. Generally they need to have gone to the right school, worked at the right bank, then at the right hedge fund. Each should show a good amount of tenure ( > 3-5 years ). A major asset man…

"This is actually generally how finance works though. The whole industry is built on the illusion of superior competence. "Prestige" is a determining factor in someones ability get a job running a hedge fund/financial asset management" It's not just finance, people everywhere are impressed by a prestigious background, and assume if you can drop certain names on your resume you must be great. Such names will open all…

There's also the irony of the fancy office. If you're a customer of a professional and walk into a very luxurious office, you know ultimately you're the one paying for that. If it were a separate surcharge to meet in the fancy office vs something basic would you chose to pay it? Yet psychologically we all feel more confident in the fancy office.

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

#394

Post by superjan » Fri, Nov 11, 2022, 5:25 PM UTC

ftx_no_name wrote: post #275

I'm one of customers that have money on FTX international which I cannot withdraw. (yup i know. bad decisions etc, but i knew the risk). Do you guys know, what will happen with the funds? Will I as a customer get any of my money back? (do you know if I'm a secured creditor?)

I am surprised that this is hardly discussed here. FTX is supposedly a large exchange, so there should be lots of individual investors affected.

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

#395

Post by Kiro » Fri, Nov 11, 2022, 5:26 PM UTC

tombakt wrote: post #383

bogomipz wrote: post #347

Earlier quoted context omitted.

I'm not sure things will be that smooth for him. It sounds as though both DOJ and SEC are looking into this: https://ustoday.news/both-the-doj-and-sec-are-investigating-...

Look at his connections, nothing of consequence will happen to him.

The context here is other CEOs stepping down after a fiasco, getting a massive severance check, saying they take "full responsibility". Compared to that SBF is massively screwed.

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

#396

Post by rchaud » Fri, Nov 11, 2022, 5:27 PM UTC

EVa5I7bHFq9mnYK wrote: post #334

memish wrote: post #322

Earlier quoted context omitted.

Here's another guy that was vouching for SBF to get in on the Twitter deal for $5b. Michael Grimes [IBanker at Morgan Stanley]: Do you have 5 minutes to connect on possible meeting tomorrow I believe you will want to take? Elon: Will call in about half an hour Michael: Sam Bankman Fried is why I'm calling https://twitter.com/sbf_ftx/status/1514588820641128452 https://www.vox.com/platform/amp/recode/2021/3/20/22335209…

Interesting, the banker thinks "Major Democratic donor" is a positive selling point for Musk. I thought he is red.

That's certainly who he started pandering to once the deal looked likely. "Democrats are the party of division and hate" in May 2022 [0]. BTW, searching for this tweet on Google is fruitless, whereas DuckDuckGo brought it up straight away (from my US-based IP).

If that was to set the stage for reinstating Trump, it seems to have backfired massively, as Trump (of all people), called him out as a BS artist and RINO.

Still, on what should have been of the busiest weeks in Twitter's history, he found time to use his Twitter bullhorn to advocate voting Republican in every race.

[0]https://twitter.com/elonmusk/status/1526997132858822658

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

#397

Post by lancesells » Fri, Nov 11, 2022, 5:27 PM UTC

tartoran wrote: post #75

lancesells wrote: post #41

Earlier quoted context omitted.

The more I read and learn about all this it feels like the work of a criminal mind more than just plain greed or hubris.

https://en.m.wikipedia.org/wiki/Hanlon%27s_razor

My point is this doesn't feel like stupidity or some confluence of mistakes. It feels more like someone realizing they can get people to invest in their house of cards while knowing it's a house of cards.

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

#398

Post by Animats » Fri, Nov 11, 2022, 5:27 PM UTC

tppiotrowski wrote: post #268

I still can't reconcile how fast this happened. Back in April SBF was willing to give billions to buy Twitter. It seemed like there was plenty of surplus or was the money he planned to invest just FTX customer holdings? "Musk responded to the text by asking if Bankman-Fried had “huge amounts of money?” MacAskill said SBF was worth about US$24 billion at the time and could be willing to provide as much as US$8 billion…

"I still can't reconcile how fast this happened."

That's normal for trading firms. Lehman Brothers went down about this fast.

The larger finance and regulatory systems are no longer willing to tolerate long "pauses" in withdrawals from crypto companies. Now, you "pause" withdrawals for a day and you're dead. Back in the Mt. Gox days, crypto exchanges went into limbo for months before the hammer of bankruptcy came down. That's over.

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

#399

Post by kgwgk » Fri, Nov 11, 2022, 5:27 PM UTC

phire wrote: post #150

rippercushions wrote: post #95

Earlier quoted context omitted.

You can't really pick and choose where to have your bankruptcy. This filing is for FTX's US entities, those in Antigua will be wound up with Antigua's rules.

Yes, that's what's weird. FTX Trading Ltd is "is incorporated in Antigua and Barbuda, and headquartered in The Bahamas", yet the linked statement clearly says FTX Trading Ltd (plus the FTX US entity, and Alameda, and others) are filing for Chapter 11 under US law in Delaware. Is there a parent company of FTX Trading Ltd that's based in the US? Edit: Apparently "Paper Bird Inc" is registered in Delaware, is 100% owned…

According to the filing Paper Bird Inc. owns approximately 75% of FTX Trading Ltd. - the rest is owned by third party investors.

https://qz.com/full-text-ftx-bankruptcy-filing-1849772656

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

#400

Post by polygamous_bat » Fri, Nov 11, 2022, 5:27 PM UTC

etc-hosts wrote: post #340

sz4kerto wrote: post #309

Earlier quoted context omitted.

Even Coinbase?

Coinbase appears now to be relatively boring, highly regulated, and compliant with US laws. I think they'll be fine.

They will be fine _modulo people's interest in crypto_. The way I think about it is that their business model is taking fees off of every transactions, so as the interest tapers off so will their earnings and valuation.