It's incredible that SBF was being touted by Sequoia, WEF, Fortune, chumming it up with Clinton and Blair in the Bahamas, getting meetings and kid glove treatment with the SEC, relatively glowing profile as a "do-gooder" by the NYT.
All while FTX had a Chief Regulatory Officer who was basically a career white-collar criminal. It beggars belief that anyone who dug half an inch into this story wouldn't have seen 90,000 watt flashing red warning signs.
Crypto turned into a haven for replaying every form of financial fraud ever invented on an epic speedrun against retail "investors", and a whole lot of powerful people and institutions have dirty hands. The idea all of this could be adequately explained by stupidity rather than malice strains credulity.
With every crypto collapse there seems to be an associated failure by the media to do any real digging. The same thing happened with Theranos where, with a few exceptions, the media fawned over Elizabeth Holmes.
It's hard to tell if the media has gotten worse at their jobs or they've always been this bad and I'm just getting older. There are plenty of earlier scams and bubbles (Enron, dot-com bubble) that slipped under the radar until thing went to shit, so I suspect the latter.
> It's hard to tell if the media has gotten worse at their jobs
It's not that "the media" has gotten worse at their jobs. Rather, there simply a lot less funding for reporters. The hit in funding has become much worse in local reporting -- especially local newspapers. However, if this is viewed as a training ground for the few large national/international news organizations, it's easy to see how this has a profound impact for even the large and well funded publications.
There's simply much less reporting happening than their used to be, and it's a real problem.
“The media” is mostly just a bunch of 20-40 year olds with liberal arts bachelors degrees, trying to make ends meet and feed their families.
Serious investigative reporters with the smarts and experience to dive deep were always the exception, maybe a handful in the world at any given time.
So IMO, “they’ve always been this bad” is the answer, but it’s not entirely fair. Kind of like saying the cooks at McDonald’s have always been this bad; in fact it has never been their job to do world-class work.
I think this is an odd take, given that it was the WSJ that broke the Theranos story and CoinDesk that broke the FTX story.
Yes, true investigative reporting is rare (and expensive), but good work is still being done.
For the media at large, given the volume of stuff you can read, much of it is plain "story-telling" or "narratives", and I do think the media is more likely to go with things that fit the narrative of the day than look at things with a critical eye.
With Theranos, the media absolutely wanted to highlight a "female Steve Jobs", and Holmes used that to her advantage. Similarly, with SBF, given all the smarmy characters in crypto, he fit the narrative of "the good guy", "the next JP Morgan" coming to save the financial system for good.
At least with Theranos, the was the media excuse of "new technologist isn't sharing the secrets of her device yet, but she showed enough to get big-names as investors and #37 on the Fortune list with as much revenue as MSFT is signed on to the tech to make it seem believable".
With Enron, they were very very good at obfuscating their scam. But it was the WSJ affiliate that was the first mover on Enron being fishy. A major short seller saw that article and shorted the stock, then turned a tip into another reporter. That reporter then pretty much started its downfall. It was, possibly, the best example of the media being the guardians against a scam since the internet started.
It’s not just the media. The investors are the primary ones to blame here, in my opinion. They literally gave hundreds of millions a of dollars to a company with a compliance officer with a history of financial fraud and scams and then touted the CEO as a boy wonder. The fact that they invested lended a lot of credence, for better or worse, to FTX.
What is the incremental revenue or profit per hour worked for a serious hard hitting investigative piece, vs other crap that is much cheaper to make (like regurgitating press releases)?
Not to mention the fact that a lot of investigative leads likely either don’t pan out, are not newsworthy, or ruffle feathers better left unruffled (news media relies on connections and access for leads on stories, and their customers are advertisers, ie large corporations).
There is not much of a market for investigative journalism. IMO tort law or class-action suits could fill that niche too if the incentives were more aligned (gotta be a lawyer to make anything off a class action) and the playing field were more even - arbitration clause says what?
So lacking an incentive for either of those the next best thing is short selling, which also sucks because it’s time-based, risky, requires capital, and isn’t relevant when something doesn’t have a direct link to a tradable security
Journalists who do puff profiles on business and political figures don't do any investigating. Investigative journalists who investigate on their own initiative are rare. Most just ride on the coat-tails of plaintiff lawyers, prosecutors, and public scandals as in this case. It's not really clear if newspapers suffer reputational harm from puff pieces that are later repudiated.
At least Matt Levine called FTX a Ponzi scheme to SBF's face [0], to which SBF had no real rebuttal (he tried to make a borrowing argument... but leveraging your Ponzi gains is also classic Ponzi).
It's stunning to me that that interview didn't crash FTX by itself, and it indicates that the industry (fintech, VCs, crypto) is engaged in a huge pump and dump. It's legitimately criminal.
I think it is worth noting that Theranos went after people who investigated them. Used the enormous war chest and high profile backers to crush anyone who challenged the official narrative. How many nascent stories get killed because a broke reporter feels threatened?
People on this site routinely post links to evade paywalls. They celebrate ad blockers. But now many of the same people are wondering why "the media" didn't stop a tech fraud? You get what you pay for.
Wait, wasn't the NYT supposed to take a very critical look at everything in "tech", as a matter of editorial policy? Why were they giving such a glowing (no pun intended!) endorsement of crypto, of all things? Something doesn't add up here.
Did you read it? I would not call it glowing at all, it seems pretty matter of fact and actually somewhat negative if you read between the lines. Opening with an anecdote about some scripted banter with Anthony Scaramucci (not a name that NYT readers have any good associations with), and then:
> The laughter has faded. Over the last few days, the collapse of a so-called stablecoin called TerraUSD has sent the crypto market into meltdown, accelerating a dramatic sell-off that tanked the price of Bitcoin and Ether, the two most valuable cryptocurrencies. At Baha Mar, Mr. Bankman-Fried was throwing a giant party for the industry; this past week, he was attempting to restore calm, tweeting long threads about the state of the market.
Then discussing how his awkward, unkempt appearance is actually calculated and intentional. And look at the final paragraph:
> Outside, the convention center was emptying, as hundreds of crypto enthusiasts headed for the airport. It was the calm before the coming meltdown. To leave the resort, guests had to walk through the Baha Mar casino, the largest in the Caribbean, a brightly lit hall of flashing slot machines.
The whole thing is framed around this guy hanging out with celebrities and lobbying government officials while his market crashes. Reading it for the first time 6 months after it was written, I think it holds up as an accurate profile with a bit of foreshadowing of what was to come.
...NYT...Why were they giving such a glowing (no pun intended!) endorsement of crypto
I don't think they did.
To check my memory, I clicked on to the "Cryptocurrency" keyword to see the crypto-related stories going back. It's mostly reporting news (which is mainly bad) and skepticism.
Is the next crypto narrative is going to be "why didn't the media save us?" I guess it makes about as much sense as all the previous crypto narratives.
Crypto doesn't pose an existential threat to the NYT business model like social media and search do. I.e. The NYT is in the advertising business. Google, Facebook, et al are direct competitors.
I think crypto aligned itself more with finance in the last year or two. E.g. Super Bowl ads, big bank partnerships and that may influence how a company is covered. The culmination of this was Roose’s “Latecomer’s Guide to Crypto” which was generally uncritical.
VCs buys anything they think they can unload on PE, funds, or even retail later down the line.
It's not specific to crypto. Theranos was a similar fraud, and so was WeWork.
They can make a public spiel about how they were deceived as long as they want, but to anyone following them at the time it was obvious they were going in with their eyes open. Whether the product works or not is simply not their top priority when making an investment.
edit: I'd like to point out to the people who clearly disagree with the above that the dude running this scheme from Bahamas was openly taking drugs and playing videogames in meetings with investors. It's even mentioned in the VC material. Yet they did shower him with money. Please do tell what kind of due diligence could possibly miss the warning flags that maybe this company wasn't completely honest?
The funny thing is Michael Lewis (Moneyball, Flash Boys, The Big Short) has been following Sam around for the last six months. He just got an incredible ending to his book.
Is there more to this? As in, he was actually in the Bahamas documenting things and Sam? This was not a red flag to anyone at FTX or involved with FTX?
" The $69 million spent by Bankman-Fried and his deputies on the 2022 midterms likely would’ve done little to plug FTX’s reported financial hole, but it couldn’t have hurt. Bankman-Fried told Forbes last month that “in the end, I care about policy more than politics,” adding that “my giving has been bipartisan, and my goal is to help support great policy makers.”
Bankman-Fried has supported Republicans during this cycle, primarily through his $2 million contribution to the blockchain and cryptocurrency-focused GMI super PAC. But the bulk of his giving, including $27 million to the Protect Our Future super PAC and $6 million to the House Majority super PAC, has gone to support Democrats. Bankman-Fried told Forbes last month that “much of this was for primaries, rather than D vs R general elections” ($33 million of his contributions were made during the first four months of 2022.) "
Jack from Twitter pumped crypto and NFTs heavily as well. It was likely a coordinate plot that will never result in punishment, but regardless, the money is gone. Many were warned that it was fraudulent early though... A whole lot of people lost their money based on pure willful ignorance, and that can't be given a pass either.
This whole crypto failure is going to act as a bit of an 'innoculant' for any relaxation of financial laws. If anything, it should lightly strengthen support for further financial regulation of Wall Street and the like. All responses to any loosening up of the banks can reasonably be countered with 'Yeah, but look at what happened with Crypto.' So I guess that's at least something.
The question is, did the VCs get tokens along with their investments? They may have already made money from selling them before the collapse while giving a sheen of respectability to FTX. That would make sense because then they wouldn't need to do any diligence.
Clinton and Blair are old. I'm starting to think this is no different from a scammer extracting a credit card number over the phone from your formerly astute great aunt.
> Crypto turned into a haven for replaying every form of financial fraud ever invented on an epic speedrun against retail "investors", and a whole lot of powerful people and institutions have dirty hands. The idea all of this could be adequately explained by stupidity rather than malice strains credulity.
This was clear years ago. That is why I've been avoiding crypto like the plague.
Did you even bother to read the article? Because the answer for everyone here seems to be "no", have a read that doesn't require a click:
A growing force in political fund-raising, he has a super PAC that recently gave more than $10 million to a Democratic congressional candidate who supports some of his philanthropic priorities.
In public, Mr. Bankman-Fried can sometimes seem uncomfortable, tapping his foot or twirling a fidget spinner. But the awkwardness is part of a calculated self-presentation. Over countless tweets, interviews and TV appearances, he’s positioned himself as a mad-scientist-cum-diplomat — a straight-talking brainiac willing to embrace regulation of his nascent industry and criticize its worst excesses.
Now Mr. Bankman-Fried is trying to leverage his fame to set policy in Washington, at a moment when the risks of crypto trading are growing increasingly stark; he makes regular trips to the Capitol from his base in the Bahamas, meeting with regulators and testifying in Congress. If he’s successful, he could become one of the most influential figures in the new era of technological experimentation that supporters call web3, writing the rule book for a slew of risky investment products that are increasingly reshaping the internet, finance and even the arts.
But his detractors say his advocacy is driven by self-interest. His political contributions have prompted complaints that he’s distorting the competitive landscape to advance his own agenda. And the charm offensive in Washington has alarmed consumer advocates who argue that FTX is exacerbating the volatility in crypto markets and putting investors at risk.
FTX serves as a portal to the crypto world. With the click of a button, a curious investor can turn dollars into Bitcoin, Dogecoin or Ether. It’s as simple as buying paper towels from Target — except that the value of a digital asset can be wiped away overnight amid the types of market gyrations that have sent cryptocurrency prices crashing over the past month. In the United States, crypto exchanges occupy a regulatory gray area: It remains unsettled whether the tokens are securities, commodities or something else entirely. Mr. Bankman-Fried has been pitching a regulatory structure with expanded authority for the Commodity Futures Trading Commission, which is smaller and less aggressive than the Securities and Exchange Commission and has traditionally been more sympathetic to the crypto industry.
FTX is headquartered in the Bahamas partly because 80 percent of its $1.1 billion in global revenue stems from a trading instrument that remains illegal in the United States. On the FTX platform, investors can borrow money to make enormous bets on the future prices of cryptocurrencies, leading to potentially astronomical gains — or catastrophic losses.
So not only is the article extremely up-front about the fact that SBF donated to the Democratic primaries (and as far as I can tell, none at all to the general election), it's far from "glowing" (it's a banal, if colorful, profile) and, contrary to the parent commenter's claims, nowhere does it claim that he is a "do-gooder", rather using the phrase in the context of how EA advocates think of themselves.
The sheer irony of people railing against misinformation in media while willfully misinforming people on social media.
> It's incredible that SBF was being touted by Sequoia, WEF, Fortune, chumming it up with Clinton and Blair in the Bahamas, getting meetings and kid glove treatment with the SEC, relatively glowing profile as a "do-gooder" by the NYT.
That's the real story here.
I transcribed a discussion between Chamath Palihapitiya and Brian Armstrong and others talking about this. Here's what he was saying about all these people who've been very blind and didn't do any due diligence:
"I just want to say the second uncomfortable thing out loud which is there are a lot of venture firms in SV in this period of both not doing any work or due diligence who also took the extra step and actually created classes and teached teams how to create these tokens.
And those artifacts --those video links and artifacts-- are sometimes on their website, they're still on YouTube, they're inside of Twitter, and what these folds would do when we talked about this, the game that they played was they would get a team they would create a token, they would also buy equity at a crazy valuation, the equity was locked up but the tokens were not, and then they would put them on an exchange and sell them to unsuspecting people and they would be able to dump these tokens and if you look inside that trend those were the trend of "securities" instead it was done in an unregulated way.
They're going to start to look at a bunch of other tokens and token sales
and you're going to end up looking at some very well known venture firms in
silicon valley.
That token is not the only token that's been engineered by SV firms and it is
also no the only token that's going to zero that's been engineered by SV venture
firms site.
There's videos (still) today on some of the most well-known Venture firm sites
on how to do this.
They're instructing people how to do this. It's what they did.
but I really also hope they figure out these other tokens as well ...
... and you will see these are unregulated securities that were sold
by our brethren..."
It is, to me, about much more than "cryptocurrencies are scam".
Many in SV are deep into this. There are officials and ex- officials implicated too.
People have been dumping worthless tokens created by the tens or hundreds on people all the while the media were presenting SBF as an altruistic trustable white knight.
That's the real story here.
Complete with SBF being the biggest or second biggest donor to Biden's campain for presidency though a fund which SBF's mom (a lawyer and teacher at Stanford) was running. And SBF's father, also a lawyer and teacher at Stanford, recorded explaining how he's helping FTX with charity and regulations.
> Crypto turned into a haven for replaying every form of financial fraud ever invented on an epic speedrun against retail "investors", and a whole lot of powerful people and institutions have dirty hands. The idea all of this could be adequately explained by stupidity rather than malice strains credulity.
Exactly. I'm glad some at least this for what it actually is.
Thankfully some people warned and described the very scam SBF was pulling the day FTX launched (in 2018 ?). Before that several had already noticed Alameda Research was behind crypto market manipulation and pump and dumps of shitcoins.
> Friedberg, who served as FTX’s general counsel before taking on the company’s regulatory role, was recently described by Coingeek’s Steven Stradbrooke as being “almost comically inappropriate” for the job. The description appears apt, given Friedberg’s long history of not complying with various jurisdictions’ regulations, but rather, evading them.
Can't make this up. Reads to me like, on the contrary, they couldn't have found anyone more qualified.
There is a German saying: "Wo ein Trog ist kommen die Schweine." roughly translates to "Where there is a trough - the pigs will come." Rather fitting for all the crypto meltdowns in the last years.
Crypto has attracted almost every type of criminal under the sun, to the detriment of 'regular' people who got conned into this stuff and is now left holding the bags.
> Crypto has attracted almost every type of criminal under the sun
This is actually quite a profound statement.
Is there actually anything in human history that can come close to rivalling this ?
We have everyone from teens promoting shitcoins on TikTok, to household celebrities like Matt Damon, to white collar criminals, to arguably VCs, all the way to nation states like Iran and North Korea.
Actually, this seems like a rather interesting defense of crypto. To use the metaphor, did the trough create the pigs? Or did it only draw a horde of pre-existing pigs to one place? Perhaps the amount of quasi-criminals that we are seeing in the crypto sector right now is just a sign that crypto was highly successful and not a condemnation of crypto in and of itself.
You are half right. It obviously did not create the pigs, but the "trough" is the place for easy pickings: Crypto. Of course Crypto did not create scammers, scammers simply have an easy time scamming people there.
Clickbait title. Tether is only vaguely mentioned and there is nothing related to Tether operations- only to an employee at Tether.
While this article covers an interesting topic, the title is clearly an attempt to bandwagon on the "Tether is next" narrative while contributing nothing substantial to the conversation
> The second near-failure of UB occurred when the site was riddled by extensive credit-card fraud during its first year or so of operations. That led parent company ieLogic to develop an antifraud software suite called ieSnare that was so effective that the company was able to license it to other online concerns.
Feels sort of nonsensical honestly. Credit card anti fraud is entirely reactionary, there’s no magic bullet, you’re just papering over the cracks of an absolutely broken payment system. Every service will see different fraud, it will always be changing, there’s no one fits all solution. Very frequently the “rules” of the systems aren’t solid and everybody trying to exploit them knows that.
It piqued my interest enough to google it and it seems like it’s actually a notable thing in the online betting world and is indeed fairly sophisticated and purpose-built.
"Crypto" is useless. Bitcoin isn't. Maximalists have been warning against this stuff happening for nearly a year now. Ever since Luna collapsed, those voices grew louder, but the yield-farming degenerates chose not to listen.
Readit News
All while FTX had a Chief Regulatory Officer who was basically a career white-collar criminal. It beggars belief that anyone who dug half an inch into this story wouldn't have seen 90,000 watt flashing red warning signs.
Crypto turned into a haven for replaying every form of financial fraud ever invented on an epic speedrun against retail "investors", and a whole lot of powerful people and institutions have dirty hands. The idea all of this could be adequately explained by stupidity rather than malice strains credulity.
https://www.nytimes.com/2022/05/14/business/sam-bankman-frie...
It's hard to tell if the media has gotten worse at their jobs or they've always been this bad and I'm just getting older. There are plenty of earlier scams and bubbles (Enron, dot-com bubble) that slipped under the radar until thing went to shit, so I suspect the latter.
It's not that "the media" has gotten worse at their jobs. Rather, there simply a lot less funding for reporters. The hit in funding has become much worse in local reporting -- especially local newspapers. However, if this is viewed as a training ground for the few large national/international news organizations, it's easy to see how this has a profound impact for even the large and well funded publications.
There's simply much less reporting happening than their used to be, and it's a real problem.
https://www.pewresearch.org/fact-tank/2021/07/13/u-s-newsroo...
https://www.statista.com/statistics/626459/number-employees-....
Serious investigative reporters with the smarts and experience to dive deep were always the exception, maybe a handful in the world at any given time.
So IMO, “they’ve always been this bad” is the answer, but it’s not entirely fair. Kind of like saying the cooks at McDonald’s have always been this bad; in fact it has never been their job to do world-class work.
Yes, true investigative reporting is rare (and expensive), but good work is still being done.
For the media at large, given the volume of stuff you can read, much of it is plain "story-telling" or "narratives", and I do think the media is more likely to go with things that fit the narrative of the day than look at things with a critical eye.
With Theranos, the media absolutely wanted to highlight a "female Steve Jobs", and Holmes used that to her advantage. Similarly, with SBF, given all the smarmy characters in crypto, he fit the narrative of "the good guy", "the next JP Morgan" coming to save the financial system for good.
With Enron, they were very very good at obfuscating their scam. But it was the WSJ affiliate that was the first mover on Enron being fishy. A major short seller saw that article and shorted the stock, then turned a tip into another reporter. That reporter then pretty much started its downfall. It was, possibly, the best example of the media being the guardians against a scam since the internet started.
Not to mention the fact that a lot of investigative leads likely either don’t pan out, are not newsworthy, or ruffle feathers better left unruffled (news media relies on connections and access for leads on stories, and their customers are advertisers, ie large corporations).
There is not much of a market for investigative journalism. IMO tort law or class-action suits could fill that niche too if the incentives were more aligned (gotta be a lawyer to make anything off a class action) and the playing field were more even - arbitration clause says what?
So lacking an incentive for either of those the next best thing is short selling, which also sucks because it’s time-based, risky, requires capital, and isn’t relevant when something doesn’t have a direct link to a tradable security
It's stunning to me that that interview didn't crash FTX by itself, and it indicates that the industry (fintech, VCs, crypto) is engaged in a huge pump and dump. It's legitimately criminal.
[0]: https://archive.ph/fGLat#selection-3973.7-3973.12 (27:13)
No, sorry, that is their job description. But since we're using radar as analogy, let me introduce to your new friend, IFF (Identify, Friend or Foe).
And the public doesn't help with their hero worship of tech douchebags.
> The laughter has faded. Over the last few days, the collapse of a so-called stablecoin called TerraUSD has sent the crypto market into meltdown, accelerating a dramatic sell-off that tanked the price of Bitcoin and Ether, the two most valuable cryptocurrencies. At Baha Mar, Mr. Bankman-Fried was throwing a giant party for the industry; this past week, he was attempting to restore calm, tweeting long threads about the state of the market.
Then discussing how his awkward, unkempt appearance is actually calculated and intentional. And look at the final paragraph:
> Outside, the convention center was emptying, as hundreds of crypto enthusiasts headed for the airport. It was the calm before the coming meltdown. To leave the resort, guests had to walk through the Baha Mar casino, the largest in the Caribbean, a brightly lit hall of flashing slot machines.
The whole thing is framed around this guy hanging out with celebrities and lobbying government officials while his market crashes. Reading it for the first time 6 months after it was written, I think it holds up as an accurate profile with a bit of foreshadowing of what was to come.
I don't think they did.
To check my memory, I clicked on to the "Cryptocurrency" keyword to see the crypto-related stories going back. It's mostly reporting news (which is mainly bad) and skepticism.
Is the next crypto narrative is going to be "why didn't the media save us?" I guess it makes about as much sense as all the previous crypto narratives.
It's not specific to crypto. Theranos was a similar fraud, and so was WeWork.
They can make a public spiel about how they were deceived as long as they want, but to anyone following them at the time it was obvious they were going in with their eyes open. Whether the product works or not is simply not their top priority when making an investment.
edit: I'd like to point out to the people who clearly disagree with the above that the dude running this scheme from Bahamas was openly taking drugs and playing videogames in meetings with investors. It's even mentioned in the VC material. Yet they did shower him with money. Please do tell what kind of due diligence could possibly miss the warning flags that maybe this company wasn't completely honest?
HSBC teaches us that the US govt happily approves of financial crime as long as it's large and they get their cut: https://www.investopedia.com/stock-analysis/2013/investing-n...
Madoff's mistake was probably not sharing with the right people, and that the optics were a bridge too far.
" The $69 million spent by Bankman-Fried and his deputies on the 2022 midterms likely would’ve done little to plug FTX’s reported financial hole, but it couldn’t have hurt. Bankman-Fried told Forbes last month that “in the end, I care about policy more than politics,” adding that “my giving has been bipartisan, and my goal is to help support great policy makers.”
Deleted Comment
Dead Comment
This whole crypto failure is going to act as a bit of an 'innoculant' for any relaxation of financial laws. If anything, it should lightly strengthen support for further financial regulation of Wall Street and the like. All responses to any loosening up of the banks can reasonably be countered with 'Yeah, but look at what happened with Crypto.' So I guess that's at least something.
Best description of all that is wrong with crypto. It's a human problem, not a tech problem.
This was clear years ago. That is why I've been avoiding crypto like the plague.
sbf was giving tons of cash to the democratic party so NYT cant find anything bad to say about him
https://www.forbes.com/sites/michelatindera/2021/10/21/the-w...
This is the basis of NYT Pitchbot.
A growing force in political fund-raising, he has a super PAC that recently gave more than $10 million to a Democratic congressional candidate who supports some of his philanthropic priorities.
In public, Mr. Bankman-Fried can sometimes seem uncomfortable, tapping his foot or twirling a fidget spinner. But the awkwardness is part of a calculated self-presentation. Over countless tweets, interviews and TV appearances, he’s positioned himself as a mad-scientist-cum-diplomat — a straight-talking brainiac willing to embrace regulation of his nascent industry and criticize its worst excesses.
Now Mr. Bankman-Fried is trying to leverage his fame to set policy in Washington, at a moment when the risks of crypto trading are growing increasingly stark; he makes regular trips to the Capitol from his base in the Bahamas, meeting with regulators and testifying in Congress. If he’s successful, he could become one of the most influential figures in the new era of technological experimentation that supporters call web3, writing the rule book for a slew of risky investment products that are increasingly reshaping the internet, finance and even the arts.
But his detractors say his advocacy is driven by self-interest. His political contributions have prompted complaints that he’s distorting the competitive landscape to advance his own agenda. And the charm offensive in Washington has alarmed consumer advocates who argue that FTX is exacerbating the volatility in crypto markets and putting investors at risk.
FTX serves as a portal to the crypto world. With the click of a button, a curious investor can turn dollars into Bitcoin, Dogecoin or Ether. It’s as simple as buying paper towels from Target — except that the value of a digital asset can be wiped away overnight amid the types of market gyrations that have sent cryptocurrency prices crashing over the past month. In the United States, crypto exchanges occupy a regulatory gray area: It remains unsettled whether the tokens are securities, commodities or something else entirely. Mr. Bankman-Fried has been pitching a regulatory structure with expanded authority for the Commodity Futures Trading Commission, which is smaller and less aggressive than the Securities and Exchange Commission and has traditionally been more sympathetic to the crypto industry.
FTX is headquartered in the Bahamas partly because 80 percent of its $1.1 billion in global revenue stems from a trading instrument that remains illegal in the United States. On the FTX platform, investors can borrow money to make enormous bets on the future prices of cryptocurrencies, leading to potentially astronomical gains — or catastrophic losses.
So not only is the article extremely up-front about the fact that SBF donated to the Democratic primaries (and as far as I can tell, none at all to the general election), it's far from "glowing" (it's a banal, if colorful, profile) and, contrary to the parent commenter's claims, nowhere does it claim that he is a "do-gooder", rather using the phrase in the context of how EA advocates think of themselves.
The sheer irony of people railing against misinformation in media while willfully misinforming people on social media.
That's the real story here.
I transcribed a discussion between Chamath Palihapitiya and Brian Armstrong and others talking about this. Here's what he was saying about all these people who've been very blind and didn't do any due diligence:
"I just want to say the second uncomfortable thing out loud which is there are a lot of venture firms in SV in this period of both not doing any work or due diligence who also took the extra step and actually created classes and teached teams how to create these tokens.
And those artifacts --those video links and artifacts-- are sometimes on their website, they're still on YouTube, they're inside of Twitter, and what these folds would do when we talked about this, the game that they played was they would get a team they would create a token, they would also buy equity at a crazy valuation, the equity was locked up but the tokens were not, and then they would put them on an exchange and sell them to unsuspecting people and they would be able to dump these tokens and if you look inside that trend those were the trend of "securities" instead it was done in an unregulated way.
They're going to start to look at a bunch of other tokens and token sales and you're going to end up looking at some very well known venture firms in silicon valley.
That token is not the only token that's been engineered by SV firms and it is also no the only token that's going to zero that's been engineered by SV venture firms site.
There's videos (still) today on some of the most well-known Venture firm sites on how to do this.
They're instructing people how to do this. It's what they did.
but I really also hope they figure out these other tokens as well ... ... and you will see these are unregulated securities that were sold by our brethren..."
It is, to me, about much more than "cryptocurrencies are scam".
Many in SV are deep into this. There are officials and ex- officials implicated too.
People have been dumping worthless tokens created by the tens or hundreds on people all the while the media were presenting SBF as an altruistic trustable white knight.
That's the real story here.
Complete with SBF being the biggest or second biggest donor to Biden's campain for presidency though a fund which SBF's mom (a lawyer and teacher at Stanford) was running. And SBF's father, also a lawyer and teacher at Stanford, recorded explaining how he's helping FTX with charity and regulations.
> Crypto turned into a haven for replaying every form of financial fraud ever invented on an epic speedrun against retail "investors", and a whole lot of powerful people and institutions have dirty hands. The idea all of this could be adequately explained by stupidity rather than malice strains credulity.
Exactly. I'm glad some at least this for what it actually is.
Thankfully some people warned and described the very scam SBF was pulling the day FTX launched (in 2018 ?). Before that several had already noticed Alameda Research was behind crypto market manipulation and pump and dumps of shitcoins.
The signs were all out there and nobody looked.
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https://youtu.be/aW6SqLXw944
Un fucking believable.
Can't make this up. Reads to me like, on the contrary, they couldn't have found anyone more qualified.
That German saying is on point and really sad.
This is actually quite a profound statement.
Is there actually anything in human history that can come close to rivalling this ?
We have everyone from teens promoting shitcoins on TikTok, to household celebrities like Matt Damon, to white collar criminals, to arguably VCs, all the way to nation states like Iran and North Korea.
Dead Comment
Is this a soft implication that the same scene should "continue" to exist as it currently is?
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(pleasure derived by someone from another person's misfortune).
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[1]: https://www.youtube.com/watch?v=BH5-rSxilxo
While this article covers an interesting topic, the title is clearly an attempt to bandwagon on the "Tether is next" narrative while contributing nothing substantial to the conversation
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That’s a pretty interesting little side story.
One example blog post: https://csgobetting.com/iesnare-how-youre-being-made-paranoi...
What unique properties does Bitcoin have that makes it useful that other cryptocurrencies don't, beside first mover advantage?