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FTX balance sheet, revealed

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Re: FTX balance sheet, revealed

#301

Post by Sparyjerry »

landemva wrote: post #254
greiskul wrote: post #161

Earlier quoted context omitted.

Exactly. People that say that the value of fiat money is fake, never think about taxes. You want to own a house? The government mandates that you acquire and give them a certain amount of US dollars. Even if you did every single transaction in your life with other assets, paying for stuff with gold and chickens, at the end of the day, the tax man will come for you, and the tax man only takes dollars.

> You want to own a house? The government mandates that you acquire and give them a certain amount of US dollars. I have gone through many county clerk & recorder documents. I regularly see 6 and 7 figure houses change hands via recorded quit claim that says things like: 'love and other valuable consideration' or the frequent 'ten dollars'. And I have read a lot of State law. While there is shady stuff in law such as…

That's just some dummy language in the deed and not the actual transfer of value. Almost every deed is for around $1 even if the sale price says millions. In the U.S. at least it doesn't matter what you put on the deed, either way they will tax you based on the actual value of the transfer.

Re: FTX balance sheet, revealed

#302

Post by chemmail »

FollowingTheDao wrote: post #175
bjornsing wrote: post #92

Earlier quoted context omitted.

But maybe it could have been? I’m a complete crypto skeptic who would never touch anything like FTT, but it’s not an obvious Ponzi scheme. I think one of the troubles with crypto is that it’s very easy to operate what is effective a Ponzi scheme, without fully realizing it yourself.

Ponzi schemes are not obvious, until they’re totally obvious. That’s why they keep happening. A lot of people will explain to others that it’s a Ponzi scheme, but those people are making so much money that hey don’t want to hear it. Crypto is a Ponzi scheme, and it always was. I’m not just talking about these companies, being Ponzi schemes, I’m talking about the whole ecosystem being a Ponzi scheme. You can either li…

A "Ponzi Scheme" is just about timing and perspective. A government may seem like a stable entity until it inevitably crumbles and looks like a Ponzi scheme. You just have to exit or shut it down before something bad happens to prevent anything into becoming a Ponzi scheme.

Re: FTX balance sheet, revealed

#303

Post by manholio »

lottin wrote: post #294
manholio wrote: post #284

Earlier quoted context omitted.

It's not just "accounting convenience" it's literally the way the profit vs loss of the central bank is defined. The central bank typically has a legal obligation to maintain stable prices, so while outstanding currency is not a liability in the conventional sense with a certain maturity date, interest etc., it's undoubtedly a debt towards society at large, which could presumably need to be redeemed and sterilized in…

You're stretching the meaning of 'debt' and 'bankruptcy' beyond what these words are generally accepted to mean.

Since the central bank controls the unit of account value and can always devalue and print itself out of any sticky situation, the only meaningful way it can go "bankrupt" is to lose the ability to appreciate the currency. I agree it's a stretch.

The notion that the central bank can conjure pure profits out of thin air and has no liability against its issued currency is fantastical, it would suggest a perpetual profit machine. In reality, any issued currency comes with a strong liability to buy it back in inflationary times, so it's clearly an external debt from the CB's perspective, this is a well established notion.

This has origin in the pre-modern, free banking era, where competing private banks issued "bank notes" attesting their demand deposits, and which in time became widely accepted. This is basically the exact thing a central bank does, with a state granted monopoly, and no link to the gold and silver the bank "owes" for the notes.

Re: FTX balance sheet, revealed

#304

Post by vgatherps »

lordnacho wrote: post #137
vgatherps wrote: post #89

Earlier quoted context omitted.

In addition to earning a spread you lose from toxic trades, i.e. someone trading when your quote is stale. Alameda has a strong incentive to knowingly do bad trades on ftx, i.e. stale quotes + spreads too small, since it increases legitimate volume numbers and generates ftx fees (gains in ftx fees offset trade loss). It's unknown if this happened or to what extent, but it can be very costly to do this in large size.

Yes but you can control this, turning it on and off as you like, and indeed market makers do this. It wouldn't explain a catastrophic loss though, it's more like a slow bleed that you balance against whatever income you're making.

If you're willingly doing this to boost the exchange, the whole point is that you keep it going even if it's in the red.

Certainly won't catastrophically explode the maker but it doesn't help if you're already hurting somewhere else.

Re: FTX balance sheet, revealed

#305

Post by lottin »

manholio wrote: post #303
lottin wrote: post #294

Earlier quoted context omitted.

You're stretching the meaning of 'debt' and 'bankruptcy' beyond what these words are generally accepted to mean.

Since the central bank controls the unit of account value and can always devalue and print itself out of any sticky situation, the only meaningful way it can go "bankrupt" is to lose the ability to appreciate the currency. I agree it's a stretch. The notion that the central bank can conjure pure profits out of thin air and has no liability against its issued currency is fantastical, it would suggest a perpetual profi…

Sorry, I can't agree that there's some unspoken promise, or even a faint expectation, that that the central bank will buy its own currency back. This is simply not true.

Re: FTX balance sheet, revealed

#306

Post by manholio »

lottin wrote: post #305
manholio wrote: post #303

Earlier quoted context omitted.

Since the central bank controls the unit of account value and can always devalue and print itself out of any sticky situation, the only meaningful way it can go "bankrupt" is to lose the ability to appreciate the currency. I agree it's a stretch. The notion that the central bank can conjure pure profits out of thin air and has no liability against its issued currency is fantastical, it would suggest a perpetual profi…

Sorry, I can't agree that there's some unspoken promise, or even a faint expectation, that that the central bank will buy its own currency back. This is simply not true.

Buy back is implicit in the price stability mission any central bank has; it cannot be fulfilled without controlling the supply of currency in the economy, i.e (at least) limited buyback. Without that, what you get is something very much like a cryptocurrency in terms of volatility.

Re: FTX balance sheet, revealed

#307

Post by pooper »

lupire wrote: post #279
pooper wrote: post #194

Earlier quoted context omitted.

I lost faith in cryptocurrency pretty early on because of the idea that it costs money to send or receive money. My ideal of a currency is it should be free of cost or almost free of cost to send or receive money. There was another post here about a thought experiment where someone asked if I had eight billion dollars, how can I send a dollar to every person on earth? Well, right now you can't because it costs too mu…

Yeah I'd like everything to be free. But nothing created by people is.

Well if you want high transaction fees then it will never replace cash. Enjoy your make believe speculative asset. I want none of it.

Re: FTX balance sheet, revealed

#308

Post by lottin »

manholio wrote: post #306
lottin wrote: post #305

Earlier quoted context omitted.

Sorry, I can't agree that there's some unspoken promise, or even a faint expectation, that that the central bank will buy its own currency back. This is simply not true.

Buy back is implicit in the price stability mission any central bank has; it cannot be fulfilled without controlling the supply of currency in the economy, i.e (at least) limited buyback. Without that, what you get is something very much like a cryptocurrency in terms of volatility.

There is no implicit promise of buying back their own coins. This is ridiculous.

Re: FTX balance sheet, revealed

#309

Post by grey-area »

HDThoreaun wrote: post #300
grey-area wrote: post #67

Earlier quoted context omitted.

SBF is a con artist. There is no point looking for a legitimate business because there wasn’t one.

Running an exchange is a legitimate business that should make tons of money if you're not embezzling customer funds.

It was not a legitimate business, there were almost zero controls on cashflow.
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