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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

#451

Post by shorthistory »

jacooper wrote: post #439
shorthistory wrote: post #423

Can anyone speculate what Bankman-Fried's exit plan was? Was this a fraud that got out of control, or premeditated? If it was premeditated, what was the exit plan? Did he expect to be able to gamble with customer funds indefinitely? Were the Effective Altruism intimations genuine? Why, if Alameda was a market maker, and they therefore presumably have some form of insight into the markets, did they then decide to take…

I think he just though that he will never get caught, it was working for a long time, why would it fail? Also why are there no lawsuits yet? Since FTX clearly broke its own T&S?

I guess the lawsuits are being prepared by affected parties as we speak.

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

#452

Post by shorthistory »

wombat-man wrote: post #445
shorthistory wrote: post #423

Can anyone speculate what Bankman-Fried's exit plan was? Was this a fraud that got out of control, or premeditated? If it was premeditated, what was the exit plan? Did he expect to be able to gamble with customer funds indefinitely? Were the Effective Altruism intimations genuine? Why, if Alameda was a market maker, and they therefore presumably have some form of insight into the markets, did they then decide to take…

I think he probably thought the value of the coins would keep rising. Hell everyone who bought in at sky high prices thought that.

But how, if you had spent time being a market maker, that is to say you understand market neutral strategies, would you convince yourself to take this bet? It seems contrary to his presumed understanding of the markets.

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

#453

Post by jmathai »

djinnandtonic wrote: post #431
Alupis wrote: post #422

Earlier quoted context omitted.

For someone that only dabbles in crypto - what are the reasons people choose to use high-risk exchanges like FTX, and buy even higher risk "sh*t coins" on them? Especially the exchange-created-and-owned coins - of which I have yet to see one actually do what it promised. Is Coinbase just not cool anymore, or is there some advantage to using exchanges like FTX until they go belly-up?

For someone that only dabbles in investing, what are the reasons people choose ultra-high-risk investments like crypto?

You would be surprised how easy it is for people to get sucked into a crypto bubble vortex that makes you feel like you're missing out big time by not being invested in crypto.

I was pretty heavily involved in the personal finance community on Twitter and there's two camps.

1) VTSAX and chill (basically dump money into an ETF and forget about it) 2) Moar passive income by side hustles and crypto

The latter became more and more common and ultimately drowned out the former. I believe it's because the market was doing so well that folks' risk meter just wasn't registering.

Probably the same reason why people choose to get into MLMs.

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

#454

Post by boeingUH60 »

herodoturtle wrote: post #419
monkeydust wrote: post #245

He should have just stuck to running an exchange and trying to innovate that game (note - earlier in the year lots of talk around their automated margin plan for wider industry beyond crypto). Theres a decent business there.

> He should have just stuck to running an exchange I'm a bit of a Luddite when it comes to crypto, can you please help me undersatnd what did SBF actually do that has caused all this trouble? Aside from running an exchange I mean. I'm just trying to understand the context of all these headlines.

He used user deposits for risky trading and lost it all.

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

#455

Post by wombat-man »

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.

he's bankrupt and deeply in debt. Why would his "connections" stick their necks out for him? I don't know if having a dad teaching at Stanford gives you a free pass everywhere.

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

#456

Post by shorthistory »

jacooper wrote: post #444
glofish wrote: post #436

Earlier quoted context omitted.

denial is a powerful drug, you are surrounded by people celebrating your genius, everything you touch turns to billions and billions it is easy to see how someone gets disconnected from reality and ends up living in the metaverse of their own genius

And with Meta you can live your wildest illegal dreams without risks! See? The metaverse isn't useless after all.

That's an interesting take. Probably wouldn't happen though, the argument being that illegal dreams taking place in the metaverse would contagiously spread to the unmetaverse.

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

#457

Post by AustinDev »

new2this wrote: post #239
NelsonMinar wrote: post #230

Is Bankman-Fried a flight risk the way Do Kwon has proven to be?

His company is already based in the Bahamas, how much further could he fly?

He wouldn't be safe from US authorities in the Bahamas. They'd happily turn him over. The US Navy leases a lot of land on Andros for a Navy base that is a significant part of their GDP iirc.

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

#458

Post by bmitc »

shorthistory wrote: post #423

Can anyone speculate what Bankman-Fried's exit plan was? Was this a fraud that got out of control, or premeditated? If it was premeditated, what was the exit plan? Did he expect to be able to gamble with customer funds indefinitely? Were the Effective Altruism intimations genuine? Why, if Alameda was a market maker, and they therefore presumably have some form of insight into the markets, did they then decide to take…

My thoughts are that FTX was maybe a legitimate business, but then Alameda was his trading baby that just happened to be run by kids, including himself, that have no idea what they're doing and was losing money left and right. Then using FTX customer funds was viewed as just a "let's move these funds over to get our trading back on track and when we do, we'll move them back". That's my honest guess if I'm being generous as to their intentions and thought process. Not saying it isn't criminal though, because I think it is. It's also a complete guess as an outsider to all this.

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

#459

Post by AndreLock »

indigodaddy wrote: post #332

Dumb question, but what happens to stuff like Miami Heat’s FTX Arena etc in situations like this? Should we expect a name change for the arena at some point soon?

The Sacramento Kings' old arena was called the Power Balance Arena in 2011-12. Power Balance went bankrupt in 2011, and the arena naming rights went to Sleep Train the following year.

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

#460

Post by pbreit »

theideaofcoffee wrote: post #346
indigodaddy wrote: post #332

Dumb question, but what happens to stuff like Miami Heat’s FTX Arena etc in situations like this? Should we expect a name change for the arena at some point soon?

I also think this is an interesting question. Coming from a lay person I'd imagine it would remain with that name until the contract is up for renewal. Depending on how the naming deal was structured, the money to do the deal would probably have come from FTX' marketing budget in a lump sum up front (presumably) for a fixed number of years. When that's done, the arena will find another source of funds and give the ri…

Unlikely is was paid up front. The news articles say things like "$90m over 19 years". There is also almost certainly terms in the contract relating to the reputation of the advertiser (FTX in this case).

All of this is handled much differently if a party is in bankruptcy (which is the point of bankruptcy).

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