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What Happened at Alameda Research

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Re: What Happened at Alameda Research

#21

Post by nl »

TotoHorner wrote: post #7
wikfwikf wrote: post #6

Earlier quoted context omitted.

But the author makes it very clear in the second par "our claims only remain tentative at best". Isn't it much more useful to write something which actually tries to answer the question of what happened, albeit with appropriate caveats, than something which doesn't advance the understanding of the reader at all?

The New York Times piece is even worse, since it paints a misleading picture of SBF and his cronies losing all the money accidentally rather than malice (far more likely).

Actually it's almost the opposite.

This piece speculates very strongly about SBF's stimulant usage degradating his cognitive abilities. Eg:

> If the above observations about SBF’s personality and competence are even half true, that would go a great deal toward explaining Alameda’s losses.

The entire article goes into much further depth. But it doesn't even speculate about malice.

Re: What Happened at Alameda Research

#22

Post by SkyMarshal »

flanked-evergl wrote: post #9

Before or after they were bribing politicians for favourable regulation for FTX at the detriment of their competitors who were not fraudulent? https://prospect.org/power/sam-bankman-frieds-multimillion-d... > Crypto’s supporters in Congress are determined to ignore the massive gap in capacity between the two agencies; in fact, they likely understand that its incapacity is part of its appeal to FTX. A bill proposed by…

Well FTX's competitors are not necessarily not fraudulent, especially their primary competitor Binance.

Re: What Happened at Alameda Research

#23

Post by gasull »

Cthulhu_ wrote: post #5
kristianov wrote: post #4

Two words: Ponzi Scheme.

And worse: pretty much everyone was aware of it, but thought that because they were aware of it and everyone else is a schmuck, they could benefit from it. Some did, but only if they liquidated their holdings last year. NFTs this year was a microcosm of exactly that. Loads of people jumped on the bandwagon, buying up NFTs as they were released, but the whole thing collapsed again when it turned out the resale market…

NFT art was likely a bubble, not a Ponzi. Many investments are bubbles, but not Ponzis.

Re: What Happened at Alameda Research

#25

Post by TedShiller »

gillesjacobs wrote: post #3

I like how OP opens smugly by calling the NYT article a fluff piece, then proceeds to immediately cite anonymous Twitter anecdotes as better sources. He's right about the specific NYT article not including much pertinent information, but they're a serious journalistic publication and have verification standards for sources.

No post body was provided.

Re: What Happened at Alameda Research

#26

Post by rkagerer »

wikfwikf wrote: post #6
gillesjacobs wrote: post #3

I like how OP opens smugly by calling the NYT article a fluff piece, then proceeds to immediately cite anonymous Twitter anecdotes as better sources. He's right about the specific NYT article not including much pertinent information, but they're a serious journalistic publication and have verification standards for sources.

But the author makes it very clear in the second par "our claims only remain tentative at best". Isn't it much more useful to write something which actually tries to answer the question of what happened, albeit with appropriate caveats, than something which doesn't advance the understanding of the reader at all?

There's so much rampant speculation in this article... for me it lost a degree of credibility around the point he fixated on the drug aspect. Despite all the disclaimers.

Yes, it paints one picture of how the losses could have added up, but I'm looking forward to more exhaustively investigated reports grounded in more than heresay and gossip.

Re: What Happened at Alameda Research

#27

Post by [deleted] »

gasull wrote: post #23
Cthulhu_ wrote: post #5

Earlier quoted context omitted.

And worse: pretty much everyone was aware of it, but thought that because they were aware of it and everyone else is a schmuck, they could benefit from it. Some did, but only if they liquidated their holdings last year. NFTs this year was a microcosm of exactly that. Loads of people jumped on the bandwagon, buying up NFTs as they were released, but the whole thing collapsed again when it turned out the resale market…

NFT art was likely a bubble, not a Ponzi. Many investments are bubbles, but not Ponzis.

[deleted]

Re: What Happened at Alameda Research

#29

Post by choeger »

A $3M monthly AWS bill. that's a nugget here. What that means is that amazon, Microsoft, and google are essentially selling shovels during a gold rush. On a subscription basis. In a form that makes it tedious and costly to actually figure out how many shovels your business has, what they do and who uses them regularly.

Essentially, when there's a digital market hype, the big cloud providers collect their share on the revenue. Brilliant.

Re: What Happened at Alameda Research

#30

Post by lordnacho »

Makes some sense. When stuff is messy, you can do financially stupid things. I've sat on desks that lost money from not realizing some very simple things like having options with upcoming dividends. If SBF really was on drugs and playing League of Legends badly, perhaps he also didn't know what was happening in his shop.

But... you have all this money. Hire an adult? Almost anyone who's had a trading desk job would tell you to clean up. You don't need to have much experience to do this part, just get one of your friends that you must know from the business?

Also, WTF would this say about Ontario Teachers' Pension Fund or Sequioa if the whole team was on drugs, playing games all day, and having no idea what their balance sheet looks like? I actually got Ontario into a fund I was at, and we'd have lost the investment if we hadn't behaved like adults. This is causing me some cognitive dissonance, because I don't think of the investors as the kind of people who'd even smile if they found me in the office playing a video game, let alone addled on drugs.

Also about the market making strats not working anymore, I don't see why they'd even need it. Once the exchange is jump started and you have WM/Jump/JS on board, there's MMs on the platform and it feeds itself. Just keep marketing running. Hand out some FTT or something to retail. Do silly advertisements. Just turn off the algo that doesn't work.

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