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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

#191

Post by physicles »

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…

Someone lying about doing EA is not doing EA. They’re doing fraud.

There’s the EA movement proper, which I don’t know much about. And then there’s EA the principle, which just says that you should probably prioritize giving that is effective rather than giving that makes you feel good (since human ethical intuition isn’t tuned very well here). Not much to disagree on there. It’s unfortunate that SBF’s fall has diverted attention from this.

(Paraphrasing Sam Harris’s most recent podcast here, https://www.samharris.org/podcasts/making-sense-episodes)

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

#192

Post by kromem »

KennyBlanken wrote: post #182
0xy wrote: post #153

Earlier quoted context omitted.

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?

> What am I missing? The fact that a massive number of high-profile advertisers have announced they've stopped buying ads? > > Audi of America, United Airlines, General Mills, General Motors, Volkswagen, Modelez International (which makes popular products like Oreos), and Omnicon (which manages advertising for brands like McDonalds and Apple) So two of the world's largest automakers, the world's richest computer comp…

Omnicom is a much bigger deal than those two clients.

It's the second largest advertising holding company in the world.

That's the biggest deal of all the names quoted by a LARGE degree.

They have 5,000 different clients.

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

#193

Post by JoeJonathan »

gruez wrote: post #126
abhv wrote: post #108

Earlier quoted context omitted.

(1) Any theory that encourages people to suspect working directly on important local causes that are meaningful to them, but instead, seek out the highest paying jobs in order to donate to EA causes is just hiding a special kind of ponzi scheme ("get more people in to fund the good work of the current people"). (2) EA creates an excuse to act outrageously evil "for the good of the longterm"

1. The underlying logic behind earning to give is sound. You flying over to Africa or whatever to do charitable activities (digging a well?) is obviously going to be less impactful than you working at some high paid white collar job and then donating the money to pay some local laborers to do the same job. 2. Contrary to what you think, there's nothing about effective altruism that requires/wants you to donate to eff…

But is the underlying logic behind earning to give actually sound? Because it sounds to me like ideological cover for plain old earning. It also strikes me as deliberately blind to the ethical externalities of working certain high paying jobs.

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

#194

Post by HWR_14 »

vngzs wrote: post #53
kieselguhr_kid wrote: post #6

I don't know if it will happen, but a potentially good outcome here would be some regulation on the business practices of sufficiently large private companies in order to ensure they meet some basic level of corporate governance. Maybe they don't need the same level of scrutiny publicly traded companies have, but establishing minimum standards of conduct would help avert crises like this that can spread across entire…

In Europe there are rules that work out to: if you have 50 employees or assets over EUR ~5 million, you must disclose audited financial statements publicly (this is not strictly true, but it is true to a first order approximation). It wouldn't be crazy sounding to require that companies worth over $10 billion USD disclose financial statements audited by reputable firms.

Disclose to a government agency or to the public. Those are very different beasts.

Like, can I look up the statements of a particularly profitable McDonalds?

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

#195

Post by HWR_14 »

wmf wrote: post #34
sillysaurusx wrote: post #31

> Three months earlier, in July 2021, Mr. Bankman-Fried bought out the roughly 15% stake owned by Binance, FTX’s first outside investor. Binance CEO Changpeng Zhao tweeted this month that the amount totaled $2.1 billion, paid in a combination of FTT, FTX’s in-house cryptocurrency, and BUSD, Binance’s stablecoin, whose value is pegged to the U.S. dollar. Hmm. Binance triggered FTX's downfall by dumping FTT, causing th…

Does this mean that Sam was the one who sold Binance the FTT which Binance subsequently used to cause FTT to collapse? Yes exactly. Binance triggered FTX's downfall by dumping FTT I don't know if they actually dumped; they just announced it. It doesn't matter now.

CZ may have planned on dumping FTT, causing a run on the bank, and then acquiring everything for almost nothing. Had it not been a fraud, it could have been a brilliant (illegal??) move. Now that it is a fraud, CA is trying to prevent the contagion from trying to take down the whole crypto market.

Hilarious if CZ managed to sell 15% for the tools to get 100% though.

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

#196

Post by HWR_14 »

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?

You should definitely have zero trust in any investment an athlete suggests. I mean, investigate it, it might be fine. But the athlete's endorsement should be worth zero.

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

#197

Post by fsckboy »

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?

if Musk's personnel changes at Twitter work out, I'm betting other .com's are going to look at the same ideas. "Sign up for hard work or leave" is a pretty compelling way to cut payroll, especially as there is industry-wide antiwork grumbling (meaning, by both workers and management). Of course, if the gamble doesn't work out, it will have been a self inflicted wound.

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

#198

Post by fsckboy »

huevosabio wrote: post #134
georgex7 wrote: post #114

Earlier quoted context omitted.

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

It's a bit of a kalman update. Many of them fully endorsed or implicitly endorsed SBF. That SBF was revealed as a fraudster should update your belief on the quality of these people, but not outright scratch them out. For example, I have severely downgraded my opinion of Sequoia.

Sequoia invests in portfolios of companies. Your judgment of them as something to invest in should be based on overall portfolio performance, not individual outliers. Your judgement of them as as willing to invest in you, does it really matter? If they give you the highest valuation, you're going to turn it down?

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

#199

Post by cwkoss »

gruez wrote: post #146
cwkoss wrote: post #110

Earlier quoted context omitted.

When people use moral identifiers, like 'altruist' or 'philanthropist' , etc. they are trying to shortcut past the normal societal repetitional mechanisms to be viewed as a moral person. The people who want to take these shortcuts tend to be the least moral people. Same force that leads the immoral to be more likely loudly publicly identify with a religion. EA may be an interesting perspective, but I'm immediately wa…

>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.

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

#200

Post by Arainach »

tedmiston wrote: post #164
Arainach wrote: post #151

Earlier quoted context omitted.

It's not baseless. Those who are least able to tolerate loss and have the least time to do due diligence are precisely those most attracted to get rich quick schemes and most susceptible to deceptive practices.

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.
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