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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

#771

Post by rossdavidh »

hotpotamus wrote: post #232
memish wrote: post #216

Earlier quoted context omitted.

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 SB…

Quoted post unavailable.

Perhaps, but I think many (Dems and Reps) will recognize a sinking ship when they see one. Tighter regulation on cryptocurrencies (and related businesses) was starting to arrive, regardless. There is little incentive to try to slow this down, if the people being regulated don't have any money left to donate to your campaign.

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

#772

Post by streb-lo »

vishnugupta wrote: post #628
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…

There’s this incredulous passage from Sequoia article that’s been taken down since. Make of it what you will At this point, mid-2019, SBF decided to double down again—and scratch his own itch. He would bet Alameda’s multimillion-dollar trading profits on a new venture: a trading exchange called FTX. It would combine Coinbase’s stolid, regulation-loving approach with the kinds of derivatives being offered by Binance a…

I this is exactly it. When you let utilitarianism run your life, you try and maximize your ability to do good, even if you have to bend a few rules on the way.

But outcomes aren't certain and high EV plays can still carry a substantial amount of risk, which is exactly why we have finance regulations.

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

#773

Post by skinnymuch »

edwnj wrote: post #442
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?

The main attraction was access to pretty much any shitcoin and advanced leverage+trading features: - multiple sub accounts - 20x leverage with tiered liquidations - you could use your portfolio as collateral - advanced trading tools This is why it was so shocking to see them collapse for doing such a stupidly bad thing, the guy seemed super smart (albeit vegan+commie).

Where is he a commie? EA has insanely famous liberals like Steven Pinker on their side. If that’s what you’re trying to get at. Otherwise I’m puzzled since his main focus is EA.

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

#774

Post by naasking »

hn_throwaway_99 wrote: post #708
null0pointer wrote: post #697

Earlier quoted context omitted.

This is pretty clearly not a failure of cryptocurrency. Bitcoin et al. are still chugging along just fine. This is, once again, a failure of a centralized business in which people placed way too much trust. I hope SBF, and other "crypto" company execs, are held accountable for misleading customers about their offerings. Specifically calling it crypto when it's not.

1. BTC has cratered 20% in the past couple days. I know, par for the course for crypto, but also a good example of why it doesn't share standard features of real currencies. 2. All the "not your keys, not your coins" mindless chanting misses the point. While true, a modern financial system depends on being able to have trust in financial institutions if you actually need to move money quickly. Years ago I went the "m…

> 1. BTC has cratered 20% in the past couple days. I know, par for the course for crypto, but also a good example of why it doesn't share standard features of real currencies.

Currencies tanking is not uncommon either. I'm not sure what you think this proves exactly.

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

#775

Post by qeternity »

AustinDev wrote: post #446
Animats wrote: post #389

"Voluntary Chapter 11" in Delaware. Figures. That gets them out from bankruptcy in the Bahamas, which is much tougher than US law. The Bahamas still has classic tough bankruptcy laws, where there's no debtor-in-possession reorganization. It's straight to liquidation, with a court-appointed receiver in charge. This should be, and may be, converted to a straight liquidation. Chapter 11 can be useful for restarting comp…

>"We have reached an agreement with Tron to establish a special facility to allow holders of TRX, BTT, JST, SUN, and HT to swap assets from FTX 1:1 to external wallets. This functionality will be enabled at 18:30 UTC, November 10, 2022." These centralized coins are hilarious. How can you negotiate a special facility to swap to those assets when they're presumably gone? Also now that they've filed for Chapter 11 won't…

Justin will conjure more out of thin air, and be probably views it as more profitable to encourage as many sheep into his ecosystem as possible, even if that means covering losses.

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

#776

Post by mjburgess »

mrguyorama wrote: post #737
hnews_account_1 wrote: post #654

Earlier quoted context omitted.

The super stupidity of using math to dazzle people around you is my greatest lesson from this. In my highly technical field, I can use math without treating it like some precious scripture. But it’s good to know it is so unfamiliar to a normal person in the VC world, I can use it to justify even a startup doing genocide as a platform or something.

It's almost like people who don't actually know anything about math, statistics, or probability shouldn't be believed when they make poor arguments using the same. Maybe there's a reason it takes 4 years of extremely tough classes to understand the basics of "hard" math.

Four years?

Most books, yt videos, jobs and academic press releases tell me all it takes is `import tensorflow` or `git clone github://lolcoin.git`

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

#777

Post by yieldcrv »

twblalock wrote: post #528

This has been a wonderful social experiment, enabling people who didn’t live in the 19th century to see what happens when banking and investing is treated like the wild west. Maybe something could have been different this time? In the end it wasn’t, and it proves the necessity of regulation and institutions. There aren’t very many other aspects of our society where we get to have that kind of experiment and find out…

an opaque shadow bank in the Bahamas crashing has nothing to do with its niche of crypto.

try not to conflate the two.

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

#778

Post by neomantra »

sillysaurusx wrote: post #588
Animats wrote: post #515

Earlier quoted context omitted.

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 tha…

I just want to say, you have some of the most fantastic coverage of events like this. It feels like having an investigative journalist on payroll. The delay between an Animats comment and this showing up in the news is significant. Thank you! (I remember your comments about the CEO that forged pay stubs being similarly excellent. Someday it might be worth collating them. In the meantime, whenever Animats says CEO Foo…

Any delay is related to the window size, MSS, and the amount of un-ACKed data ;)

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

#779

Post by shorthistory »

bmitc wrote: post #755
timmytokyo wrote: post #693

Earlier quoted context omitted.

Seeing these kids talk puts it even more into perspective. Just watch this video of Caroline Ellison, CEO of Alameda. https://www.youtube.com/watch?v=aW6SqLXw944

I made a comment on that video elsewhere. It’s pretty clear they were way out of their league in more ways than one. They’re the type of people that are too smart for their own good where they can’t even see how idiotic they’re being. Or maybe they’re just spoiled. Or maybe they just think they’re smart. It’s interesting to me that Jane Street prides themselves on their hiring process, but they apparently hire folks…

I agree, it reflects VERY poorly on Jane Street.

They like to give the impression they hire Ultra Mega Geniuses who have done the IMO (who cares if you did the IMO at age 17...?)

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

#780

Post by Animats »

null0pointer wrote: post #694
Animats wrote: post #389

"Voluntary Chapter 11" in Delaware. Figures. That gets them out from bankruptcy in the Bahamas, which is much tougher than US law. The Bahamas still has classic tough bankruptcy laws, where there's no debtor-in-possession reorganization. It's straight to liquidation, with a court-appointed receiver in charge. This should be, and may be, converted to a straight liquidation. Chapter 11 can be useful for restarting comp…

Wait, why does a Bahamas based company get to choose the jurisdiction where its bankruptcy proceedings are held? Surely if they are a Bahamas company they are beholden to Bahamas bankruptcy laws?

Background on multi-jurisdiction bankruptcies.[1] It's complicated. A lot depends on who makes the first legal move.

[1] https://www.financierworldwide.com/forum-managing-cross-bord...

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