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FTX’s Sam Bankman-Fried cashed out $300M during funding spree

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Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#111

Post by PaulDavisThe1st »

brindlejim wrote: post #101
thepasswordis wrote: post #42

Just a general statement on people commenting on this saga: Sam wasn't doing effective altruism. He was lying about doing effective altruism. It's weird to me that people talk about this as an indictment of EA...but this rings similar to me as claiming that this is an indictment of DeFi or cryptocurrency generally. Sam/Caroline weren't doing DeFi, and neither were they really doing anything related to cryptocurrency.…

Kind of. Sam was not doing what EAism says you should do. But he was embedded in the EA movement, close to many of its other members, and abetted by people like Will. So if you look at EA descriptively, Sam was very much doing EA. He was lying about his business. But he wasn't lying about giving the money away. That was very real, and a big part of what "doing effective altruism" is. Sam/Caroline were also doing cryp…

> But both those movements were happy to work with them when they appeared to be successful, non-fraudulent billionaires.

Are you claiming failure to do "due diligence" ? Because otherwise, that seems fairly normal.

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#112

Post by mejutoco »

c7b wrote: post #79
thepasswordis wrote: post #42

Just a general statement on people commenting on this saga: Sam wasn't doing effective altruism. He was lying about doing effective altruism. It's weird to me that people talk about this as an indictment of EA...but this rings similar to me as claiming that this is an indictment of DeFi or cryptocurrency generally. Sam/Caroline weren't doing DeFi, and neither were they really doing anything related to cryptocurrency.…

The justifications in EA's long-termism are very similar to SBF's 'expected-value-reasoning', and the idea of buying out politicians to promote your cause is straight out of the EA playbook, fully justified by the philosophy. Just saying 'don't break laws while getting rich' is a band-aid, the problems exposed here run deeper.

EA sounds to me like Machiavelli. In summary: the end justifies the means.

I thought this was covered in any ethics class before highschool, I cannot see what is so interesting about it.

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#113

Post by cwkoss »

loceng wrote: post #71
karmakurtisaani wrote: post #30

Earlier quoted context omitted.

I think the reason is that he was seen as a financial genius boy wonder who just understood crypto better than anyone from the "old guard". So he got away with wildly inappropriate things. More generally, we (as a society) seem to be worshiping those who make a fortune, and forget that they too are just as faulty as the rest of us. Initial innovative success gets projected to mythical proportions, and once the invest…

Elon and Zuck aren't comparable - other than earning billions from scalable enterprise.

I think capital gains are not really 'earning' something, in the standard English use of the word.

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#114

Post by georgex7 »

slibhb wrote: post #73
thepasswordis wrote: post #42

Just a general statement on people commenting on this saga: Sam wasn't doing effective altruism. He was lying about doing effective altruism. It's weird to me that people talk about this as an indictment of EA...but this rings similar to me as claiming that this is an indictment of DeFi or cryptocurrency generally. Sam/Caroline weren't doing DeFi, and neither were they really doing anything related to cryptocurrency.…

It's an indictment of EA because many prominent EA people were associated with FTX/Sam. That shows poor judgement and, on some level, EA is about smart people making judgements about long-term good. How can we trust them to make those judgements when they decide to hitch their wagon to FTX?

Prominent investors, politicians, athletes, etc were associated with FTX/Sam. Should we lose faith in Sequoia, etc, etc, etc?

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#115

Post by PaulDavisThe1st »

jliptzin wrote: post #109
acjohnson55 wrote: post #98

Earlier quoted context omitted.

I'm not sure what your point is. You can invest in whatever you want in the Bahamas without being accredited (as far as I know). If anything, the blowup of FTX seems to justify why investments in unregistered securities in US-based companies aren't allowed to be marketed to unaccredited investors. Are you saying we should allow companies with the level of oversight FTX had more free reign to operate and market their…

I am saying the whole “accredited investor” thing should be abolished

So, USA makes some effort to stop ripoffs of unwitting "unaccredited" investors within the USA.

Because this cannot stop ripoffs outside the USA, you propose ditching the within-borders effort?

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#116

Post by gruez »

slibhb wrote: post #104
gruez wrote: post #91

Earlier quoted context omitted.

>That shows poor judgement and, on some level, EA is about smart people making judgements about long-term good. How can we trust them to make those judgements when they decide to hitch their wagon to FTX? Charities in general aren't exactly known for conducting thorough due diligence on their donors. Sure, it might make sense to make sure the person you're getting money from isn't some sort of ruthless dictator or em…

I wasn't talking about charities specifically, I was referring to stuff like this: https://forum.effectivealtruism.org/posts/xafpj3on76uRDoBja/... At least one of the people involved (MacAskill) is a big name in EA circles.

What's the argument here? That The people involved should have seen it coming, and their failure to seen it coming reflects badly on them? I think the arguments from my previous comment still apply.

People in general don't do thorough due diligence on who they work with. As long as there isn't anything obviously bad about a person, it seems fairly reasonable to cooperate with someone who shares your goal and is willing to contribute resources. From what I can tell, SBF/FTX's public image was reasonably clean prior to the blow up. The wikipedia article[1] only lists some minor controversies (eg. FDIC cease and desist). This definitely isn't something like bitfinex/tether where there's a long controversy spanning years[2].

[1] https://en.wikipedia.org/wiki/FTX_(company)#History

[2] https://en.wikipedia.org/wiki/Tether_(cryptocurrency)

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#117

Post by [deleted] »

loceng wrote: post #71
karmakurtisaani wrote: post #30

Earlier quoted context omitted.

I think the reason is that he was seen as a financial genius boy wonder who just understood crypto better than anyone from the "old guard". So he got away with wildly inappropriate things. More generally, we (as a society) seem to be worshiping those who make a fortune, and forget that they too are just as faulty as the rest of us. Initial innovative success gets projected to mythical proportions, and once the invest…

Elon and Zuck aren't comparable - other than earning billions from scalable enterprise.

[deleted]

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#118

Post by PaulDavisThe1st »

luckylion wrote: post #78
kieselguhr_kid wrote: post #44

Earlier quoted context omitted.

The idea behind the lack of regulation is that the impact is contained to the investors. It's obvious that in sufficiently large cases, that's not true. If these actors are able to do damage to entire sectors, they should have to do some minimum stuff: keep track of their money, have board meetings, submit to audits, etc.

And they will ... it's just that they'll provide false numbers to audits, their board will be them and their friends, and they'll keep track of their money as it makes its way into their pockets. I guess we need more blockchain! But what business will have 100% of their relationships, contracts and transactions publicly visible?

Prosecution for factually lying (e.g. "providing false numbers to audits") is much easier than prosecution for intentionally lying (i.e. fraud).

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#119

Post by JumpCrisscross »

georgex7 wrote: post #114
slibhb wrote: post #73

Earlier quoted context omitted.

It's an indictment of EA because many prominent EA people were associated with FTX/Sam. That shows poor judgement and, on some level, EA is about smart people making judgements about long-term good. How can we trust them to make those judgements when they decide to hitch their wagon to FTX?

Prominent investors, politicians, athletes, etc were associated with FTX/Sam. Should we lose faith in Sequoia, etc, etc, etc?

> Should we lose faith in Sequoia, etc, etc, etc?

...yes? Or at the very least, qualify the brand. I've seen founders use XYZ-backed to great effect with investors, customers and even public officials. Making it clearer that Sequoia investing in a company isn't Sequoia saying it's done deep diligence is good for everyone.

Re: FTX’s Sam Bankman-Fried cashed out $300M during funding spree

#120

Post by codehalo »

skizm wrote: post #72

The amounts of money we’re talking about here are sort of staggering. I know they did a pretty good job of not keeping any records of depositors, but do we have any sense of depositor demographics, total number of depositors, or average account size? Any KYC at all? Like did retail “investors” really pump close to $16B into this? Could the scam here be crypto whales used this as an off ramp to turn their crypto into…

Clients had to log into FTX to witness their account balances and history, so it is impossible that the data was never captured or available.
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