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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

#201

Post by luckylion »

kieselguhr_kid wrote: post #169
luckylion wrote: post #78

Earlier quoted context omitted.

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?

Have you worked with a reputable outside auditor? You don't just provide numbers and illustrate your methodology for obtaining them, you have to essentially reconstruct your entire revenue and finance system with them, provide ongoing random samplings, demonstrate the consistency of any calculations, and many, many other steps that I don't have time to illustrate. Companies couldn't just provide a false number, they'…

That depends on how much effort it is to fool the auditors. Will it cost you 5bn a year or 5mn? It worked for Wirecard, and as far as I understand, it wasn't super sophisticated either.

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

#202

Post by lost_tourist »

0xy wrote: post #153
threeseed wrote: post #124

Earlier quoted context omitted.

Sequoia was also backing Musk's takeover of Twitter. Not sure if they ended up investing. If they did then their record is looking pretty poor right now.

Twitter is at peak MAUs and according to previous financial statements should be cash flow positive after personnel changes. Seems like they invested in a business which was almost immediately switched into a profitable enterprise on an upward trajectory. What am I missing? Or are you making a prediction that is the opposite of available evidence?

I think this quarter might look good for twitter with 70-80% of their employees gone but next isn't going to look so great after there is no one to fix bugs and add features.

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

#203

Post by jliptzin »

Arainach wrote: post #200
tedmiston wrote: post #164

Earlier quoted context omitted.

There is nothing in the premise correlated to the amount of the investment. Suppose I have a net worth of $900k and want to invest $10k each into friends and family rounds of 5–10 startups. The Accredited Investor law in the U.S. makes that impossible today. What if my net worth was $1M before the pandemic and is now ~30% below that threshold? Suddenly, I'm no longer accredited?! That makes no sense. The boundaries c…

Perfect is the enemy of good. Just because we can't block all ways to take advantage of people doesn't mean that we shouldn't block any.

Yes, it does. Instead of a startup getting its first investment (from a non-accredited investor) which might have gone on to do amazing things, that extra $$ is instead dumped into highly leveraged options, or penny stocks, or shitcoins, or collapsing crypto exchanges, etc. Money goes down the path of least resistance. I would be okay with it if you could also become accredited by taking an exam testing your knowledge of risk tolerance, money management, etc. Otherwise it is just gate keeping. I say this as an accredited investor with several startup investments, by the way.

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

#204

Post by gruez »

cwkoss wrote: post #199
gruez wrote: post #146

Earlier quoted context omitted.

>EA may be an interesting perspective, but I'm immediately wary of anyone who self-identifies as an "effective altruist". The logic makes sense on the surface. For instance, if someone self-identifies himself as a philanthropist/altruist and makes an effort to make that known I'll be a bit suspicious. However, effective altruism is a movement/community, so it seems reasonable to be able to identify yourself as belong…

It's certainly true at all EAs aren't bad people. I'm just arguing that self identifying EAs are disproportionately bad people due to the attraction they have towards being labeled as such. Good EAs are less likely to be vocal about the label.

> I'm just arguing that self identifying EAs are disproportionately bad people

Is there evidence backing this assertion? Or are we just going with "SBF was an effective alturist, SBF was bad, therefore self identifying EAs are disproportionately bad people"?

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

#205

Post by misiti3780 »

KennyBlanken wrote: post #183
LeafItAlone wrote: post #179

Earlier quoted context omitted.

Peak MAU means nothing if they can’t keep investors or get those people to pay (to make up for the advertisers they may be losing). It is likely at peak MAU because a lot of people want to be “in” during what they _think_ is the crash (think of crypto a year ago when it was a peak, but now it’s way down). Current MAU may or may not be reflective of MAU in a month or two since the reason is so weird. The old financial…

Advertisers the "may" be losing? They're canceling their spending in droves if you google the subject...

Really? https://twitter.com/eglyman/status/1590385689895784448

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

#206

Post by PeterStuer »

karmakurtisaani wrote: post #30
slap_shot wrote: post #5

> the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals. The most fascinating part of this whole story to me is just how few checks and balances there were in this company. Even without a board, did major investors not get his quarterly financials? If the leaked balance sheet was any indication of their level financial engineering cap…

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…

I find it hard to believe that tier 1 VC's would not have specialized top notch crypto talent on hand.

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

#207

Post by rglover »

gruez wrote: post #152
rglover wrote: post #103

Earlier quoted context omitted.

Most-promoted, but is it the most funded? For example, their landing page just links to the AMF's donors list page while claiming EA provided "significant support" with the only mentions of EA being people they've inspired to donate in relatively small amounts (relative to the billions moving through FTX). I'd imagine they're buried in there somewhere but if they're a major supporter I'd assume they'd be plastering t…

>Most-promoted, but is it the most funded? For example, their landing page just links to the AMF's donors list page while claiming EA provided "significant support" with the only mentions of EA being people they've inspired to donate in relatively small amounts This seems totally expected if you think of effective altruism as a movement focused on figuring out where your money would be best spent, rather than as some…

> And why would you compare that to "the billions moving through FTX"?

Because they were parading SBF around as this bastion of EA. No doubt a lot of people anchored their ships to FTX because of this and used his affiliation as evidence of FTX being "the good guys." Is it a direct relationship? Not as far as I've seen, but I wouldn't be surprised to find a lot of the money they were taking in (as investment and deposits) as a low-key slush fund for people tied to EA.

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

#208

Post by HDThoreaun »

rglover wrote: post #103
Tenoke wrote: post #87

Earlier quoted context omitted.

That's not really an accurate characterization. The most promoted cause by EA has been the Against Malaria Foundation because it saves the most money per $ spent. If you donate to GiveWell (a basic recommended way to donate in EA) they mostly donate to Malaria and similar causes. Obviously, some members do a lot more but Political causes aren't the standard, that stuff is.

Most-promoted, but is it the most funded? For example, their landing page just links to the AMF's donors list page while claiming EA provided "significant support" with the only mentions of EA being people they've inspired to donate in relatively small amounts (relative to the billions moving through FTX). I'd imagine they're buried in there somewhere but if they're a major supporter I'd assume they'd be plastering t…

https://www.givewell.org/impact-estimates#:~:text=on%20this%....

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

#209

Post by HDThoreaun »

misiti3780 wrote: post #205
KennyBlanken wrote: post #183

Earlier quoted context omitted.

Advertisers the "may" be losing? They're canceling their spending in droves if you google the subject...

Really? https://twitter.com/eglyman/status/1590385689895784448

That's from 10 days ago. The Eli Lily account which kicked off the ad exodus was 5 days ago.

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

#210

Post by isitmadeofglass »

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?

> That shows poor judgement

How so? The fact that people make decisions based on only what they actually know is in no way a lapse of judgement. I mean what else are they supposed to do?

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