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FTX was *throwing* money at everything moving in the crypto space. Where the heck did all the money go? Did they just spend VC money as long as they could and ran out now? Or did all the money disappear through the Alameda pipe? I really hope that there will be an investigation into the whole thing. Liquidity crunch my a**.
Can someone ELI5 what has happened here?
Imagine McDonald's makes its own money, let's call them clown-bucks, keeps most of it, and sells some to the market.
McDonald's then uses their remaining clown-bucks as collateral for actual loans.
And then people remember clown-bucks aren't real.
And then Starbucks comes and market sells the clown-bucks they were holding, while reminding the market that clown-bucks aren't really a thing.
McDonald's balance sheet is trashed, with their clown-bucks wiped out.
Anyway, that's what happened in crypto-land this week.
https://pbs.twimg.com/media/FhEKHDuVIAUfg7g?format=jpg&name=...
Earlier quoted context omitted.
What it actually revealed that they embezzled customer funds? It's still speculation as far as I can tell (your sources say nothing about customer funds)
> still speculation They've admitted to illiquidity transforming into insolvency. That doesn't happen if you aren't betting client assets.
Earlier quoted context omitted.
> bit early to speculate on this We’ve seen the balance sheet. The facts have been on the table for FTX as much as they are for Tether. I can’t say when they will fail. But as soon as we saw the Alameda books and Alameda and FTX’s responses (the former, an irrelevant statement about other assets; the latter, a claim of solvency without proof), the endpoint was sealed. Insolvent, leveraged entities don’t pay out junio…
I think the parent was pointing out that this is just an intent to acquire and could fall through.
Earlier quoted context omitted.
Can you explain this comment, I don't see democrats as being bought in crypto? What would giving them money accomplish? Most politicians in both parties are very skeptical of all this crypto tulipmania. There are a very small number who seem to bought in. Republicans are in that group too.
SBF put $10 million this summer into an Oregon Democratic primary in an attempt to advance a candidate sympathetic to Effective Altruism, rationalism, and AI ethics to the US House (the candidate lost). SBF has in general been flashing a lot of cash over the past 2 years in order to become a major philanthropist in the EA space.