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A software change allowed FTX to use client money

reuters.com

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Re: A software change allowed FTX to use client money

#241

Post by rwmj »

bogomipz wrote: post #143
CuriousCosmic wrote: post #77

Earlier quoted context omitted.

That's what happens when you decide to write your smart contract language in what is basically javascript and your smart contracts are interpreted in a stack based VM. Doubly so when your contract execution is entirely determined by the order in which Tx happen to get accepted. It's actually sane when your contract is written in a non-turing-complete language with strong typing and the smart contract system has deter…

>"That's what happens when you decide to write your smart contract language in what is basically javascript and your smart contracts are interpreted in a stack based VM." What was the language and why did running it in a stack based VM lead to this? I'm curious about the intersection of the language and the type of VM it ran in.

Solidity. The Wikipedia article has some more information on the problems: https://en.wikipedia.org/wiki/Solidity#Criticism

Re: A software change allowed FTX to use client money

#242

Post by drexlspivey »

adrr wrote: post #146
helsinkiandrew wrote: post #93

Earlier quoted context omitted.

> Singh will definitely get prison time as well Remember Alamada wasn’t a normal customer. It was acting as a market maker/counterparty of last resort to many other FTX customers. In that case there could be situations where ‘normal customer liquidation rules’ shouldn’t apply - it can go in the red temporarily to enable others to trade (and FTX to make commission). From the facts in the article (which are obviously n…

I never understood why Alameda took risky bets when it could just make a bunch of cash off buy/ask spreads assuming trading volume was decent. Running the exchange they can front run any large trades and move the market.

Yeah its not as simple as putting two limit orders and collecting your fee. Market makers take huge risks when there is a big market move. When Luna crashed for example Alameda provided exit liquidity to traders and was left holding the bag.

Re: A software change allowed FTX to use client money

#243

Post by TheNorthman »

rxhernandez wrote: post #220
RF_Savage wrote: post #204

Earlier quoted context omitted.

The engineer would have a hard time claiming ignorance with multiple widely reported public statements about how Alameda had no special priviledges.

Should an engineer be tracking what their company is telling media outlets? No one else is tasked with looking at my code except other engineers; why should engineers spend their precious time making sure that other business units are performing their duties ethically?

Probably because the whole Topf & Söhne debacle doesn't need repeating? Engineers are of course partly responsible for the things they implement.

Re: A software change allowed FTX to use client money

#244

Post by VBprogrammer »

megablast wrote: post #165
jacquesm wrote: post #157

Earlier quoted context omitted.

Ignorance of the law is never an excuse if you are found to be breaking the law. So if you think what you are doing is possibly in violation of the law you better bone up or ask a lawyer for a statement on letterhead that what you are doing is ok.

So every dev needs to also be an expert lawyer and financier??? OK.

There are blatantly illegal things you can do in any field of work. You need to be aware of what is and isn't within the law on a loose basis yes. Even labourers on a building site have to do some training to avoid breaching health and safety legislation (or at least to minimise the companies liability when they error).

You also need to have faith in the compliance team and senior management. If your company works in legally sticky territory like crypto doubly so.

Re: A software change allowed FTX to use client money

#245

Post by checkyoursudo »

joshlemer wrote: post #190
xg15 wrote: post #181

Earlier quoted context omitted.

"I was only following orders" is generally seen as a bad defense since the end of WW2.

This is why I don't get why the phrase/excuse/justification "I'm just doing my job" is so commonly used.

It can be hard to do the right thing, especially if there are real-world consequences like "do this bad act or lose your job" threats.

However, "do this bad act and we'll all get rich" seems a bit ... harder to sympathize with.

Re: A software change allowed FTX to use client money

#246

Post by astrange »

r_hoods_ghost wrote: post #233
barbariangrunge wrote: post #137

Earlier quoted context omitted.

Director of engineering != product manager in charge of deciding what features to include. If somebody tells engineering, “we will not use this feature illegally,” then it’s the fault of the higher ups who are possibly (?) trying to scapegoat somebody to protect themselves

Directors have specific, well defined legal duties to their company which includes a duty of fiduciary responsibility. That is why they're directors rather than "head of product" or "VP of marketing" or whatever other meaningless title people bestow on themselves. Saying "my boss told me to do it so it is not my fault" is nonsense because you have no boss beyond your shareholders.

Isn't VP usually a higher title than director?

(Well, it's not in finance, but it could be in tech-like crypto finance.)

Re: A software change allowed FTX to use client money

#247

Post by bilvar »

yarky wrote: post #107
strangeattractr wrote: post #104

Earlier quoted context omitted.

Junk bonds are bonds with high credit risk, what’s wrong with selling them to customers who are after high yields?

It's not like junk was a part of the name right?

Didn't they get credit agencies to rank them as premium and not junk though? I think that we know they were junk after the fact.

Re: A software change allowed FTX to use client money

#248

Post by astrange »

spookthesunset wrote: post #192
everfree wrote: post #182

Earlier quoted context omitted.

Do you really believe that when Satoshi originally sat down to write the Bitcoin source code, he was thinking "I am going to write an open source software tool that's purpose-built for committing fraud"?

Who even knows who Satoshi is? It could be the original scammer… who really knows?

I'm still hoping it's Paul Le Roux.

Re: A software change allowed FTX to use client money

#250

Post by reverius42 »

r_hoods_ghost wrote: post #233
barbariangrunge wrote: post #137

Earlier quoted context omitted.

Director of engineering != product manager in charge of deciding what features to include. If somebody tells engineering, “we will not use this feature illegally,” then it’s the fault of the higher ups who are possibly (?) trying to scapegoat somebody to protect themselves

Directors have specific, well defined legal duties to their company which includes a duty of fiduciary responsibility. That is why they're directors rather than "head of product" or "VP of marketing" or whatever other meaningless title people bestow on themselves. Saying "my boss told me to do it so it is not my fault" is nonsense because you have no boss beyond your shareholders.

That's Director as in Board of Directors. In this case, "Director of Engineering" probably just means "Manager of managers of engineers".
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