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Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

theguardian.com

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Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#181

Post by the__alchemist »

sillysaurusx wrote: post #16

She’s the queen of wallstreetbets. I think she’ll hold the yolo record for a long time. I wish we knew what the fateful market play was that sunk her ship. She mentioned she’s not a fan of stop losses, so I wonder if she went to bed with an open market position and woke up to negative three billion. Also I wonder if the entity on the other side of that trade realized they were making someone insolvent. It’ll be inter…

Tangent: How did people hear about FTX? I've been interested in/holding crypto for a few years, and the big player was (and I assumed still is until recently) Coinbase, or Coinbase pro if you wanted better rates. There was bitcoin, Etherium, and some smaller coins like Bitcoin Cash, XRP, and Litecoin. I had a mix of coins, then rebased in ~2019 to a 50/50 Eth/Bitcoin split. As an alternative to Coinbase, you could use a hardware or paper wallet. How many people used FTX over Coinbase and wallets? What was the appeal?

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#182

Post by SanjayMehta »

sillysaurusx wrote: post #16

She’s the queen of wallstreetbets. I think she’ll hold the yolo record for a long time. I wish we knew what the fateful market play was that sunk her ship. She mentioned she’s not a fan of stop losses, so I wonder if she went to bed with an open market position and woke up to negative three billion. Also I wonder if the entity on the other side of that trade realized they were making someone insolvent. It’ll be inter…

This podcast is the source of some of the clips which showcase her thought process.

Quite fascinating.

https://www.youtube.com/watch?v=Qd2enI4RvXU

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#183

Post by Galanwe »

fredgrott wrote: post #63
sillysaurusx wrote: post #16

She’s the queen of wallstreetbets. I think she’ll hold the yolo record for a long time. I wish we knew what the fateful market play was that sunk her ship. She mentioned she’s not a fan of stop losses, so I wonder if she went to bed with an open market position and woke up to negative three billion. Also I wonder if the entity on the other side of that trade realized they were making someone insolvent. It’ll be inter…

Gee I wonder if Arrow Capital thought it wise to stop hedging via shorting; did Alameda Research fall into the exact same trap? The only sure bet is yes they did!

The problem with crypto is that you cannot hedge everything.

Some tokens, such as exchange tokens (BNB, FTT, etc) are unshortable locally (by construction) and no other exchange proposes futures for them.

This creates a very risky lock in to one platform.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#184

Post by hammock »

gnicholas wrote: post #165
vkou wrote: post #164

Earlier quoted context omitted.

People who went to elite schools hang out with other people who went to elite schools. This isn't particularly surprising.

I was referring to the hubris that is presumably required to even attempt a fraud on this scale. Were the uniquely able to get away with this because of their bona fides, or were they uniquely predisposed to attempt this, due to the circumstances of their upbringing?

I'm sure plenty of "non-elite" people have the hubris. Just not the access to capital

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#185

Post by akira2501 »

whendoyoushrink wrote: post #156
jongjong wrote: post #118

I agree, they should reduce her punishment from 250 years to just 150 years if she cooperates.

While that sounds tough, that's not a smart negotiation plan at all. The negotiation will be more beneficial with a scale, based on traded info, that more resembles: "Your life is over" "Your life is over until you are retirement age" "Your life is over until after you go through menopause" "Your life can restart before you're 30" Or, you know, just hang tough and get no dirt.

That seems to only allow for prison being purely a punishment, and that some level of deprivation must be included in order for the sentence to be considered complete.

Truly beneficial scale would simply be: "You can return to regular society with restrictions after you have been rehabilitated, and you can return to regular life after your victims have been compensated."

The other thing that's bothersome about these showy sentencing standards is that it provides good cover to the regulators and legislators who should be auditing their past actions with respect to this enterprise and should be holding honest hearings on how the legislation failed to protect consumers.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#186

Post by nradov »

super256 wrote: post #120
Lapsa wrote: post #41

Earlier quoted context omitted.

I've never understood how stop losses are supposed to help. Traders read heaps of news, do God knows what technical analysis yet simple "moves bit too much in wrong direction" is supposed to be an acceptable exit strategy.

If you trade highly leveraged stuff, you need stop losses; otherwise there is a considerable chance you will go bankrupt. Especially when you take bets on interest rate decisions, take the sweeps at market open and other stuff (you can gain a few hundred points on NQ1! per contract easily during such times). Also, it's a psychological thing: traders think in risk. If they were mistaken with a trade idea, they close t…

Stop loss orders can work reasonably well for retail investors trading small positions in liquid securities, but they aren't completely reliable. Sometimes prices make a sudden discontinuous drop on bad news and blow past the limit order before it can be executed. Or if trading is halted they become useless. And for institutional investors trading large positions in less liquid markets, stop loss orders barely work at all. They usually employ more sophisticated hedges.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#187

Post by jongjong »

whendoyoushrink wrote: post #156
jongjong wrote: post #118

I agree, they should reduce her punishment from 250 years to just 150 years if she cooperates.

While that sounds tough, that's not a smart negotiation plan at all. The negotiation will be more beneficial with a scale, based on traded info, that more resembles: "Your life is over" "Your life is over until you are retirement age" "Your life is over until after you go through menopause" "Your life can restart before you're 30" Or, you know, just hang tough and get no dirt.

Haha yeah I was just making fun of the idea that such potentially long sentences can be negotiated down at all.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#188

Post by bmitc »

Lapsa wrote: post #41
baobabKoodaa wrote: post #29

Earlier quoted context omitted.

> She mentioned she’s not a fan of stop losses At the volume they were trading, stop losses are no longer practical. The market is not infinitely deep.

I've never understood how stop losses are supposed to help. Traders read heaps of news, do God knows what technical analysis yet simple "moves bit too much in wrong direction" is supposed to be an acceptable exit strategy.

But the phrase “cutting your losses” has application does not?

A stop loss could be set at a threshold that isn’t so tight to lose money on normal variations, low enough if it’s acceptable to take the loss and and capture and deploy the capital elsewhere, and not too low to never be triggered.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#189

Post by EMM_386 »

jjulius wrote: post #60
sillysaurusx wrote: post #38

Earlier quoted context omitted.

But she’s highly regarded! It’s all just a little joke. Check out https://www.reddit.com/r/wallstreetbets . Also https://m.youtube.com/watch?v=jg85H26wyLk She certainly earned her sentence, and I have no sympathy for her. But isn’t it hard not to be at least a little impressed with the sheer scale of her losses? Getting in the record books for “most money lost by a single individual” is a hard thing to do in general.

>It's all just a little joke. Super funny to every single person who lost money to the person "getting in the record books for 'most money lost by a single individual'".

Their ‘chief regulatory officer’ Dan Friedberg was previously tied to a massive online poker scandal!

Let's get real here, there was no "due diligence" or anything else that should have been done when you are investing hard-earned money.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#190

Post by richbell »

SpeedilyDamage wrote: post #56
ffssffss wrote: post #34

Earlier quoted context omitted.

Queen of WSB and yolo record are not a good thing... that is a subreddit that mocks bad risk management by ironically celebrating it. They know exactly what she is over there.

Hah maybe at one point was that sub ironic, it's been unironic for years now.

"It's okay babe, I developed a crippling gambling addition and gambled away our life savings ironically."
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