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FTX to file for U.S. bankruptcy, CEO resigns

reuters.com

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Re: FTX to file for U.S. bankruptcy, CEO resigns

#611

Post by lazide »

everfree wrote: post #597
twblalock wrote: post #528

This has been a wonderful social experiment, enabling people who didn’t live in the 19th century to see what happens when banking and investing is treated like the wild west. Maybe something could have been different this time? In the end it wasn’t, and it proves the necessity of regulation and institutions. There aren’t very many other aspects of our society where we get to have that kind of experiment and find out…

I don't see why crypto is incompatible with regulation and institutions. Crypto is a unit of account, not some magical lawless thing that's doomed to never have a regulation written about it. In fact, places like New York already have pretty strict regulations requiring specific licenses for crypto-related businesses. Crypto crises like these are in general due to regulation not having caught up yet, not because comp…

Crypto is incompatible with regulation and institutions because it was designed to be, and is consistently a part of the ethos espoused by pretty much all crypto players?

Literally, the first sentence in the Bitcoin whitepaper (which arguably kicked off 'crypto' as a thing) is "A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution".

[https://bitcoin.org/bitcoin.pdf]

I mean, seriously?

Re: FTX to file for U.S. bankruptcy, CEO resigns

#612

Post by 127 »

twblalock wrote: post #528

This has been a wonderful social experiment, enabling people who didn’t live in the 19th century to see what happens when banking and investing is treated like the wild west. Maybe something could have been different this time? In the end it wasn’t, and it proves the necessity of regulation and institutions. There aren’t very many other aspects of our society where we get to have that kind of experiment and find out…

Bitcoin is neither banking or investing. It's a decentralized ledger.

I for one am not very excited to continue using the legacy systems with countless of middle men and entrenched rent seekers to extract the maximum they can out of the completely legal trades I do with other consenting individuals.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#613

Post by jrumbut »

barkingcat wrote: post #583
twblalock wrote: post #528

This has been a wonderful social experiment, enabling people who didn’t live in the 19th century to see what happens when banking and investing is treated like the wild west. Maybe something could have been different this time? In the end it wasn’t, and it proves the necessity of regulation and institutions. There aren’t very many other aspects of our society where we get to have that kind of experiment and find out…

even the idea of "declaring bankruptcy" is a modern regulated construct. In medieval times, if you "declare bankruptcy" your family and dependents get sold into slavery and your wife is sold off to the highest bidder who will buy your debt. In many previous times, if you couldn't pay debts you'd just be killed.

This idea of auctioning off someone's wife seemed (seems) unlikely to me in a medieval European context (since divorce was hard to come by).

What I found was actually weirder:

> In medieval Italy and southern France, it was common for the cedens to stand nude but for his shirt and strike a stone with his posterior ('vituperii lapis') while declaring 'cedo bonis'." The patent purpose of this ceremony was as much to satisfy the anger and frustration of creditors as to publicize the debtor's bankruptcy.

http://www.mgh-bibliothek.de/dokumente/b/b071148.pdf

Re: FTX to file for U.S. bankruptcy, CEO resigns

#614

Post by nradov »

jfghi wrote: post #593
tasubotadas wrote: post #555

Earlier quoted context omitted.

Why does this need to be regulated? We already have banks for that. And it's not like regulation saved them from being able to become insolvent.

Because financial fraud isn’t a victimless crime.

In this particular instance of fraud it's impossible to feel any sort of sympathy for the "victims". They absolutely deserve their losses.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#615

Post by lazide »

barkingcat wrote: post #583
twblalock wrote: post #528

This has been a wonderful social experiment, enabling people who didn’t live in the 19th century to see what happens when banking and investing is treated like the wild west. Maybe something could have been different this time? In the end it wasn’t, and it proves the necessity of regulation and institutions. There aren’t very many other aspects of our society where we get to have that kind of experiment and find out…

even the idea of "declaring bankruptcy" is a modern regulated construct. In medieval times, if you "declare bankruptcy" your family and dependents get sold into slavery and your wife is sold off to the highest bidder who will buy your debt. In many previous times, if you couldn't pay debts you'd just be killed.

Well, those 'previous times' where you just got killed ran concurrent too those slavery times. And if you borrow money from the wrong people today, it can still happen.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#617

Post by nullc »

Animats wrote: post #515
jacooper wrote: post #439

Earlier quoted context omitted.

I think he just though that he will never get caught, it was working for a long time, why would it fail? Also why are there no lawsuits yet? Since FTX clearly broke its own T&S?

U.S. Department of Justice lawyers are already closing in.[1] Using customer funds held in custody is theft. Period. People go to jail for this. This may be the biggest embezzlement of customer funds held in custody in history. Most scams involve misuse of funds invested, not just held in custody. The biggest outright theft of this type seems to have been Peregrine Financial.[2] That was $200 million, far smaller tha…

> This may be the biggest embezzlement of customer funds held in custody in history.

I wouldn't be surprised to learn that the amount of actual customer funds that went in were much smaller than claimed.

Keep in mind FTX was mostly 'perpetuals' -- fake assets. It might be that a lot of the customer funds were just fictional gains, also may be that a lot of them were paper value owned by SBF entities.

I've been trying to find anyone I personally know that had FTX exposure and so far I'm coming up dry.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#618

Post by kgwgk »

memish wrote: post #4

The CEO of Alameda said "we tend not to have stop losses... I'm trying to think of a good example of a trade where I've lost a ton of money... I probably don't want to go into specifics with that" https://twitter.com/ApeDurden/status/1590912098871435265 Now how did this place end up managing billions of dollars and SBF the darling of politicians? The picture is starting to come into focus. SBF used customer funds to…

I'm sure they have many things on their plates now but they really should think about deleting their twitter profiles.

"nothing like regular amphetamine use to make you appreciate how dumb a lot of normal, non-medicated human experience is" https://twitter.com/carolinecapital/status/13790363463003054...

SBF should delete twitter mostly to stop publishing increasingly ridiculous "I’m really sorry, again" messages: "Hopefully things can find a way to recover. Hopefully this can bring some amount of transparency, trust, and governance to them. Ultimately hopefully it can be better for customers."

Re: FTX to file for U.S. bankruptcy, CEO resigns

#619

Post by Auracle »

djinnandtonic wrote: post #431
Alupis wrote: post #422

Earlier quoted context omitted.

For someone that only dabbles in crypto - what are the reasons people choose to use high-risk exchanges like FTX, and buy even higher risk "sh*t coins" on them? Especially the exchange-created-and-owned coins - of which I have yet to see one actually do what it promised. Is Coinbase just not cool anymore, or is there some advantage to using exchanges like FTX until they go belly-up?

For someone that only dabbles in investing, what are the reasons people choose ultra-high-risk investments like crypto?

High risk, high returns.

I bought some (emphasis on the some, sadly) Bitcoin when it was $80. I’ll never get a return like that in my life. Other people are chasing that dragon. Unfortunately it leads them to burgeoning “shitcoins.”

It’s all fine if you view it like the lottery and put “fun money” into it. It’s not fine if it’s your primary investment vehicle. For what it’s worth I still think Bitcoin and Ethereum will be fine and bounce back up, eventually.

Re: FTX to file for U.S. bankruptcy, CEO resigns

#620

Post by supdup »

twblalock wrote: post #528

This has been a wonderful social experiment, enabling people who didn’t live in the 19th century to see what happens when banking and investing is treated like the wild west. Maybe something could have been different this time? In the end it wasn’t, and it proves the necessity of regulation and institutions. There aren’t very many other aspects of our society where we get to have that kind of experiment and find out…

Protectionist government is the only reason why societies would need to go through cycles of repeating the experiment. When they are protected, they forget how to protect themselves... from their own decisions.
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