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

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

#511

Post by nkozyra » Fri, Nov 11, 2022, 6:30 PM UTC

sdiacom wrote: post #499

Julesman wrote: post #463

I'm not a luddite (on hacker news lol) and I can clearly see the revolutionary potential of blockchain. But, for the love of God, can we STOP the blind short-term speculation on the promise of extreme wealth. Moderate investment can support development without the kind of hype that ruins lives and sullies public perception of the technology.

As someone with a similar-ish position to yours, I think by the time someone figures out how to build something useful with this technology, the terminology of cryptocurrencies (blockchain, "defi", NFTs and whatever a "web3" is) will be so tightly associated with scams, that this new useful thing will use completely different terms to describe itself.

While true, there's an endless supply of new buzzwords to use to capture another round of rubes.

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

#512

Post by vkou » Fri, Nov 11, 2022, 6:31 PM UTC

shorthistory wrote: post #452

wombat-man wrote: post #445

Earlier quoted context omitted.

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.

People who understand that betting on red over and over again isn't a long-term winning strategy usually don't make the news for fraudulently pissing away 8 billion dollars of customer funds.

It's survivorship bias.

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

#513

Post by nannal » Fri, Nov 11, 2022, 6:32 PM UTC

thwayunion wrote: post #491

Julesman wrote: post #463

I'm not a luddite (on hacker news lol) and I can clearly see the revolutionary potential of blockchain. But, for the love of God, can we STOP the blind short-term speculation on the promise of extreme wealth. Moderate investment can support development without the kind of hype that ruins lives and sullies public perception of the technology.

> can we STOP the blind short-term speculation on the promise of extreme wealth I first played around with blockchain in 2011 or so and I still don't know what actual utility this technology is supposed to have. I have never -- never -- encountered a value-producing use case for cryptocurrency that can't be solved by either signed git commits or a SQL database. Around 2015 a lot of people I thought were smart enough…

I don't trust you, you don't trust me, neither of us trust the guy who owns the git server but I need to give you something without anyone being able to stop us.

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

#514

Post by jker » Fri, Nov 11, 2022, 6:32 PM UTC

anon291 wrote: post #350

hotpotamus wrote: post #232

Earlier quoted context omitted.

Quoted post unavailable.

Good point. That must mean democrats can do no wrong. /s This sort of non sequitur is dangerous to democracy.

Indeed, the deregulation that led to the 2008 financial crisis was a thoroughly bipartisan effort, one that began in the Clinton Administration. This is why Brooksley Born is a hero for our times, and Larry Summers, a villain. https://en.wikipedia.org/wiki/Brooksley_Born

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

#515

Post by Animats » Fri, Nov 11, 2022, 6:32 PM UTC

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?

U.S. Department of Justice lawyers are already closing in.[1]

Using customer funds held in custody is theft. Period. People go to jail for this.

This may be the biggest embezzlement of customer funds held in custody in history. Most scams involve misuse of funds invested, not just held in custody. The biggest outright theft of this type seems to have been Peregrine Financial.[2] That was $200 million, far smaller than this one.

What happened to the CEO of Peregrine? Here he is, 10 years after conviction:

    Bureau of Prisons Inmate Locator
    RUSSELL R WASENDORF
    Register Number: 12191-029
    Age:   74
    Race:  White
    Sex:  Male
    Located at: Jesup FCI
    Release Date: 02/19/2054

[1] https://fortune.com/crypto/2022/11/10/ftx-sam-bankman-fried-...

[2] https://archives.fbi.gov/archives/omaha/press-releases/2013/...

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

#516

Post by kasey_junk » Fri, Nov 11, 2022, 6:33 PM UTC

thwayunion wrote: post #491

Julesman wrote: post #463

I'm not a luddite (on hacker news lol) and I can clearly see the revolutionary potential of blockchain. But, for the love of God, can we STOP the blind short-term speculation on the promise of extreme wealth. Moderate investment can support development without the kind of hype that ruins lives and sullies public perception of the technology.

> can we STOP the blind short-term speculation on the promise of extreme wealth I first played around with blockchain in 2011 or so and I still don't know what actual utility this technology is supposed to have. I have never -- never -- encountered a value-producing use case for cryptocurrency that can't be solved by either signed git commits or a SQL database. Around 2015 a lot of people I thought were smart enough…

A “universal” api for moving money between financial institutions that don’t have existing relationships would be extremely valuable and could unlock innovation in everything from payments to mortgages.

But the blockchain space has an extreme bias against the existing finance world. Frequently products in the space want to tear it down as they view it as predatory.

This leaves us with the current situation, the crypto industry speed running the history of finance and a technology in search of a problem.

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

#517

Post by thwayunion » Fri, Nov 11, 2022, 6:34 PM UTC

nwah1 wrote: post #496

nu11ptr wrote: post #488

Earlier quoted context omitted.

Separation of money and state is definitely a worthwhile goal in my opinion. Everything else is more questionable.

The state has a monopoly on the use of force. It can tax, expropriate, conscript, regulate, and otherwise redirect resources however it wants, and it can demand payments in any currency it chooses. The wishful thinking involved in trying to "separate" money and states is absurd. Even under a gold standard, the government can acquire resources from the public at will. The entire goal is nonsense. The root desire there…

Back in the beginning, bitcoin was intensely attractive to people who were in the intersection of extreme libertarian ethics and cosmopolitan financial capitalism ethos.

It's a fundamentally contradictory world view, of course. You cannot have cosmopolitan financial capitalism without very strong states propping up an extremely unnatural global order. But you can understand how middle-wealthy tech people ended up there. They were self-made, annoyed with taxes, and primarily held wealth that was generated without geographic ties. This is opposed to traditional middle-wealthy folks, whose revenue streams were historically closely tied to place and/or community.

Now that the End Of History is over, the contradiction is laid bare, and the reaction has been a sort of ideological immune response triggering fever dreams that are increasingly absurd and desperate (metaverse, web3, NFTs).

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

#518

Post by crypt1d » Fri, Nov 11, 2022, 6:34 PM UTC

acover wrote: post #388

crypt1d wrote: post #255

Earlier quoted context omitted.

Its hard to tell, but looks like the fall out is far from over. There are a lot of rumours running around so unsure what is true and what is not, but we've gotten confirmations from a lot of crypto companies to be affected one way or another. Genesis (a big OTC trading company) lost about 160M but their parent company wrote them a check. BlockFi seems to be in the hole and has closed withdrawals. Blockfolio (an FTX o…

For those curious I think srm is serum and sol is solana. https://www.kraken.com/learn/what-is-serum-srm > Serum is a decentralized exchange software built on Solana where cryptocurrencies can be bought and sold by traders

Correct. I've been in this world so long I forget 'normal people' don't really know all the acronyms :)

more rumours are surfacing, including Yuga Labs (biggest name in the NFT space), Jump Crypto, Paradigm... this is basically our Lehman Brothers moment

edit: looks like Yuga might be ok after all. luckily, sometimes rumour is just a rumour.

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

#519

Post by fuckstick » Fri, Nov 11, 2022, 6:36 PM UTC

nannal wrote: post #513

thwayunion wrote: post #491

Earlier quoted context omitted.

> can we STOP the blind short-term speculation on the promise of extreme wealth I first played around with blockchain in 2011 or so and I still don't know what actual utility this technology is supposed to have. I have never -- never -- encountered a value-producing use case for cryptocurrency that can't be solved by either signed git commits or a SQL database. Around 2015 a lot of people I thought were smart enough…

I don't trust you, you don't trust me, neither of us trust the guy who owns the git server but I need to give you something without anyone being able to stop us.

> give you something

Eh? You can’t like give me anything - you can give me a token - which can also effectively be money. The latter usually occurs due to some other trust relationship needing to be established - we are back at square one.

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

#520

Post by caycep » Fri, Nov 11, 2022, 6:36 PM UTC

kasey_junk wrote: post #516

thwayunion wrote: post #491

Earlier quoted context omitted.

> can we STOP the blind short-term speculation on the promise of extreme wealth I first played around with blockchain in 2011 or so and I still don't know what actual utility this technology is supposed to have. I have never -- never -- encountered a value-producing use case for cryptocurrency that can't be solved by either signed git commits or a SQL database. Around 2015 a lot of people I thought were smart enough…

A “universal” api for moving money between financial institutions that don’t have existing relationships would be extremely valuable and could unlock innovation in everything from payments to mortgages. But the blockchain space has an extreme bias against the existing finance world. Frequently products in the space want to tear it down as they view it as predatory. This leaves us with the current situation, the crypt…

How is it currently run? From my layperson experience, every time I do a wire transfer, I feel like I'm inputting data into a mainframe or something...