How could this all happen? Is there no regulation?
Regulation can help detect fraud, it might discourage fraud, but it can't prevent it. MF Global, Enron, Maddoff, etc. How long did Maddoff run his little scheme before being caught?
FTX’s SBF had a secret 'back door' to transfer billions off the books
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Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#62Also in the pockets of a few Sequoia partners?
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#63So what kind of backdoor is this? Is he claiming that his Quickbooks is mislabeled? Or is this blockchain analysis?
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#64The psychology of this is fascinating. Here we have crypto golden child SBF worth billions of dollars. He literally never had to do anything for the rest of his life. Even if he lost billions on Alameda and/or fTX he'd still be completely fine. Instead, he seemingly stole FTX customer assets in a failed attempt to save Alameda, run by his girlfriend. The upside here was what? More money? How much money do you need? O…
> Here we have crypto golden child SBF worth billions of dollars. He literally never had to do anything for the rest of his life. Even if he lost billions on Alameda and/or fTX he'd still be completely fine. Instead, he seemingly stole FTX customer assets in a failed attempt to save Alameda, run by his girlfriend.
You can see that the same drivers and personality traits that allow a person to succeed at such an enterprise are the same ones which would lead a person to fail at such an enterprise.
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#65Earlier quoted context omitted.
> the original —actual— value proposition of crypto was: Buying heroin. That's totally unfair. It was buying all kinds of drugs, and weapons, and child porn, and stolen credit cards, and hiring assassins. The assassins invariably turned out to be working for the FBI, of course.
The value proposition was uncensorability, irreversibility, non-inflationary nature, and permissionless nature. It's a tool that can be used for good or evil, just like the personal automobile, which was also abused in early years for malicious ends - just as telephony, the internet, and a number of other technologies were. Criminals are early adopters of new & emerging technologies, that doesn't make those technolog…
The drug trade is definitely culpable for violence and human misery. Unless you're perhaps talking exclusively about psychedelics (and even that isn't squeaky clean, but production and distribution is less violent due to the origin and effort required in distribution), the users while not directly responsible, are absolutely funding some grotesque stuff behind the scenes that they usually brush under the rug.
None of this means that the war on drugs etc was justified or that its implementation did not have serious flaws, just that the drug trade isn't a manufacturer of purely victimless crimes.
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#66This has been some of the funniest few days in recent memory. Even my crypto true-believer HODL maximalist friends are questioning the entire ecosystem and its value. I think it’s funny that so many people have been hypnotized by get-rich-quick schemes and promises of a utopian monetary system while forgetting what the original —actual— value proposition of crypto was: Buying heroin. As a corollary to “not your keys…
Why would this make someone question crypto? FTX was not a blockchain. It was a website run by one guy which (incorrectly) told you that he was holding some crypto for you. FTX could have been an exchange for anything, and it would have been the same outcome, had the CEO gambled with customer deposits like SBF did
> Why would this make someone question crypto?
I don’t know, I am not into crypto. I assume you might have to ask one of the many thousands of people that have lost untold quantities of money to a nearly infinite number of scams why they might question the practical value of the crypto ecosystem.
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#67This has been some of the funniest few days in recent memory. Even my crypto true-believer HODL maximalist friends are questioning the entire ecosystem and its value. I think it’s funny that so many people have been hypnotized by get-rich-quick schemes and promises of a utopian monetary system while forgetting what the original —actual— value proposition of crypto was: Buying heroin. As a corollary to “not your keys…
Why would this make someone question crypto? FTX was not a blockchain. It was a website run by one guy which (incorrectly) told you that he was holding some crypto for you. FTX could have been an exchange for anything, and it would have been the same outcome, had the CEO gambled with customer deposits like SBF did
Any other exchange for "anything" would be under regulation. Crypto folks like to think they are not. That's the issue here.
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#68This has been some of the funniest few days in recent memory. Even my crypto true-believer HODL maximalist friends are questioning the entire ecosystem and its value. I think it’s funny that so many people have been hypnotized by get-rich-quick schemes and promises of a utopian monetary system while forgetting what the original —actual— value proposition of crypto was: Buying heroin. As a corollary to “not your keys…
Even funnier is the fact that people don't buy heroin using Bitcoin on the darknet anymore, bitcoin's transaction fees are now too high for the average drug user.
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#69Nearly a decade after mtgox and this insanity has only grown.
Re: FTX’s SBF had a secret 'back door' to transfer billions off the books
#70How could this all happen? Is there no regulation?
That's like saying why does crime happen, are there no laws?
He broke plenty of regulations by co-mingling customer funds, trading deposits, and it seems just recently flat out stealing.