The lengths he does to blame CZ and Ray is pretty telling. He really seems to still be in massive denial. The idea that he could still raise billions to make customers whole and that this pesky chapter 11 technicality is getting in the way also seems insane.
This reads as if he wrote this himself with no legal supervision. Is he under oath with these statements?
"raise billions to make customers whole" also still means fraud; he's taking investor money and giving it away. The purpose of invested funds is to improve the business, with a long-term goal of returning more than you were given to investors. Not doing that is the definition of securities fraud.
> "raise billions to make customers whole" also still means fraud; he's taking investor money and giving it away.
I think the means "take investor money, make customers whole, thereby restore FTX, raise the company value and then pay back investors", which is not fraud. That being said, I wouldn't put it beyond him anymore to publicly suggest defrauding investors.
He's a guy who believes he's way smarter than he actually is. He's confused luck with skill and thinks he understands things better than everyone else.
He doesn't consider the bad case scenarios because in his mind, he'll have planned for them. But he is in this scenario. Which is a bad case. That he didn't plan for. That is bad because of his attitude and lack of planning.
He thinks he can somehow fast-talk Congress into thinking he didn't commit a crime.
He's going to go to jail thinking that the jury fucked up by finding him guilty. If they just understood, they'd realize he's better than everyone and deserves to be free and rich and to use your money.
Your first two paragraphs could describe one founder I know as well... So far he and his pals only burned 800 million or so, and didn't defraud anyone as far as I can tell.
He’s an active drug addict and career criminal. His ramblings about how it was someone else’s fault and he just needs someone to give him a little more money because his plans were sound make just as much sense coming from a white guy with impressive parents as they do coming from anyone else.
At one point in the saga, he fired his lawyers because they were telling him to shut the fuck up and he didn't want to. Whatever lawyers he has now are probably still telling him to shut the fuck up, and he's completely ignoring their advice right now. Great idea, by the way, when you're facing criminal charges.
I wonder if he has some kind of personality bias stemming from being raised by a couple of lawyers. Kids often rebel against the immediate ancestor generation, could this be him lashing out at all things lawyer-like, "disrupting" it and doing things "his way?"
SBF is not the first person who thinks they are smarter than their lawyers. It even fits the pattern of "physics person dismissive of other fields" (e.g. https://xkcd.com/793/)!
I dunno if we need to go too far into the particulars of his life to explain it. When Popehat was talking about the legal troubles of people in Trump's orbit this came up a lot (and a lot of those people were lawyers!).
A physicist goes to see a lawyer. He knows that above all the lawyer is interested in getting his money. So the physicist not wanting to be taken for a sucker walks into the room and fires right away:
- Hi, how much do you charge?
The lawyer fires back:
- $400 for two questions. What is your second question?
Also, a good chunk of this is him essentially insulting one of the more respected and high-performing law firms out there. He's gonna have a fun time trying to get some other firm to help him...
It's just business sense: if the previous guy drops the client like a hot potato, it's a pretty strong hint that they're trouble. Although in SBF's case you don't really need to rely on subtle hints to find that out.
lawyers in California are in a register, available to others in the profession. Over time, law practice diverges significantly, and the norms of those specialties are partly cultural and partly for saving-face or other sorts of soft-values. The truth is that half of what lawyers do involves serious-life-changing winners or losers, so there is a thick skin of indifference among many. With all that said - certain specialties of generally-rivalrous groups do keep careful track of the opposition names and faces, probably less careful track of ally names and faces. Some of those lawyers have a very, very good memory for these things. $0.02
According to a NYT article, he was insisting that billions in funding came in 8 minutes after filing for Chapter 11, but of course, couldn't give any details, or any reason why someone would give such funding:
>>In a letter to former colleagues last week, he said he regretted filing for bankruptcy, claiming that “potential interest in billions of dollars of funding came in roughly eight minutes after I signed the Chapter 11 docs.”
>>He presented no evidence for that claim, and in any case, FTX was no longer his company to run.
Well, I heard that there was a Nigerian royal with a long-lost inheritance -- all he needed was for SBF to have access to the FTX bank account and the funds could have been wired postehaste!
"Potential interest". That's not actual money; that's not even "I'm interested in giving you money". That's "I could be interested in giving you money". That plus an actual $6 will get you a cappuccino.
It's "i claim to have billions to save you, but due dilly and all. shoot me a zip of all your books records and everything else inside the kimono so I can scoop all the juicy intel on my competitors before the window to exclusive access ro that data shuts."
Good catch, I was overstating SBF's claim there. Still, knowing his penchant for lying, even that much ("potential" interest) is probably a self-deluded exaggeration.
The maximum sentence for perjury or 18 USC 1001 is only 5 years anyway.
Even if SBF could raise billions to make his victims whole, he could still be convicted of wire fraud and other charges. Fraud that is unsuccessful or results in no loss is still a crime. SBF is trying to deflect attention away from what he has done. Is it working.
> A run on the bank forced immediate liquid delivery from FTX.
Which bank? FTX? FTX was in his own words an "exchange." An exchange holds customer funds in custody for immediate redemption. A bank lends customer funds out and can't meed a redemption surge.
Also, the conspiracy theorists claiming that this guy was swept out of the hearings to protect powerful people are in for a big disappointment. It's just more of the same line as before "I messed up, but I won't tell you specifically how and if I hint at it it will be self-serving."
I think the "bank run" terminology should be read as a term of art from economics and finance that describes the situation when an entity holds long-term assets against short-term liabilities, and these liabilities are called by customers on short notice creating a solvency issue. The classical reference is Diamond-Dybvig (1983).
It is not so critical whether the organization is formally a "bank" under a legal and regulatory definition, the economics are the same regardless.
> describes the situation when an entity holds long-term assets against short-term liabilities, and these liabilities are called by customers on short notice creating a solvency issue
FTX didn’t suffer a bank run. Diamond-Dybvig describes a bank trying “to call in their loans,” borrowers being “unable to pay back quickly, since their loans were, by assumption, used to finance long-term investments,” and thus “if all depositors attempt to withdraw their funds simultaneously, a bank will run out of money long before it is able to pay all the depositors” [1]. The bank was solvent. Then it was illiquid. Illiquidity finally caused insolvency.
FTX was not solvent to start with. Alameda owed them more than it was worth. The FTT position within Alameda resembles a bank run, but that characterisation is problematic since FTT wasn’t financing anything long term and was issued by an “exchange” doing fraud.
FTX customers can perform leveraged trades, where they borrow money from FTX and post other assets as a collateral. In theory there could be some kind of liquidity crisis if FTX had to liquidate many margin trades at the same time. But that's irrelevant; the real issue with FTX was plain old embezzlement of customer funds.
> In theory there could be some kind of liquidity crisis if FTX had to liquidate many margin trades at the same time.
I don't think there can be.
If all assets customers have title to are held 1:1 in the currency the liability is denominated in, there is no scenario I can see where FTX is unable to fulfill customer withdrawal requests. Even if customers make use of significant margin and FTX has to liquidate all of their margin positions at once due to tanking prices. The customer who pledged their assets as collateral have now forfeited them to FTX and so have no withdrawal to make, so no liquidity crisis. The customers who did not make use of margin should have their assets sitting there ready to be withdrawn. Can you explain how a liquidity crisis can occur through margin trading?
FTX may lose significant sums of money, and face a solvency crisis (they may have to shut down margin trading altogether), but it should always be able to give customers their assets back. Unless they are misusing customer assets for other things.
Oh, it's clear, except that it's also part of the campaign to make it seem as if FTX customers are partly to blame, because everybody knows that if you lend money to the bank, the bank lends it out. But FTX is not a bank, and had absolutely no business lending out customer deposits.
So yes, please, more pedantry now, to prevent any more attempts at "narrative drift"
>"I have sent five emails to Mr. Ray. Mr. Ray has never responded, nor has he reached out to me
to communicate in any other ways. He has not responded, for instance, to an email of mine that stated:
>“I have potentially pertinent information concerning future opportunities and financing for FTX and its creditors. I also believe that I have relevant financial information about FTX US, and further that I have potentially relevant regulatory information concerning FTX"
It's difficult to read that and not think he's become entirely divorced from reality. Weren't his ideas about "future opportunities and financing" and "relevant regulatory information" exactly the cause of this entire mess?
There's a certain logic to it. What statement could he make where, if it was believed, it would put him back where he was three months ago?
Clamming up and speaking only through counsel might have changed things in November, but it's too late now. May as well throw your Hail Mary.
It's the same sort of logic that pervades the entire project. What would you do in a world where crypto prices only go up? Try it in the real world and see what happens.
> "John Ray and S&C were both lawyers and/or administrators for the estate, which paid out roughly $700m in legal fees"
There is a lesson here to future entrepreneurs. There is often a lot more money in the long term for those doing the boring work of cleaning up messes than for those building paper wealth and spending it on football sponsorships and other branding.
Indeed! There's an entire industry of litigation consulting that exists often for this very purpose. Lawyers and consultants made about $6 billion in revenues over the course of Lehman Brothers' decade-long fallout and unwinding all of the liabilities. The same industry probably made a similar amount on the opposing side as well, representing the debtholders. Very complicated and tedious work, and thus it gets rewarded.
This testimony is truly remarkable in its level of petulant whinging. Perhaps the single most astonishing thing in it, though, are screenshots of what appears to be a private group chat with Binance CEO CZ, called "Exchange coordination":
Interesting. It's odd that b) and c) are the same screenshot. I wonder if he intended to post a different one.
It was extremely weird for CZ to accuse SBF of trying to depeg Tether with a $250k short. I don't know what to make of that.
Also strange is how CZ asked for group admin permission from another person at FTX and then went right away to asking if anyone objected to removing SBF from the group. I guess the group was managed by FTX and CZ was attempting to take control of it as FTX was collapsing.
CZ, not yet fully aware that he is dealing with an unsophisticated bumbler (and thus the risk that this chat would someday be part of congressional testimony), is talking candidly but at cross purposes with Sammy.
CZ knows (and presumes SBF also knows) how incredibly thin this market's liquidity really is, and thus the potential destabilization that a mere 250k signal could ignite. while Sammy apparently believes something closer to version of the numbers meant for public FOMO consumption.
This little screenshot, (if not eventually proven fabricated, which is almost certainly going to be the counter signal message by CZ, parroted across the crypto community) likely is the biggest bombshell tell in this testimony so far.
There's zero chance $250k can affect Tether's liquidity. If you were talking $250 million, I'd still highly doubt it, but then you'd be reaching well past what I can dispute. The idea that $250k can budge this market is laughable.
The point isn't the size of the trade; the point is that smart money might follow Alameda, and so news that Alameda is "shorting" Tether might, on its own, be enough for CZ to ask that Sam stop.
What's not being pointed out here is that to CZ, and actually even to Sam, there really is no distinction here between Alameda and FTX. CZ is calling him on a position taken by Alameda, via their "Exchange chat," to coordinate between FTX and Binance.
Two things - not only do we have centralized exchanges, but they're also coordinating with each other... what was that about decentralization of power again?
Oh, and using seven of your 18 page testimony to basically distract from the issue at hand - seems more like a petulant child throwing a tantrum than a serious person running a multi-billion dollar business. Good lord.
> Two things - not only do we have centralized exchanges, but they're also coordinating with each other... what was that about decentralization of power again?
That's the beauty of merkle trees-- you just go into your own local copy (or merely paste one from a friend's copy), check your hashes are correct, then upload it to whatever other centralized discovery service of your choice and keep doing business. Even if colluding centralized bad actors tried to append some junk, it only takes one honest friend (or honest you) to get you back to the correct level of nesting dolls. And as long as you can find one honest centralized discovery service to wrap it in, you're back to your original level of convenience.
Oh wait, that's git I'm thinking of. Yeah, these customers are absolutely fucked.
I've noticed this pattern with other high IQ, well-written people. It's almost a defense mechanism, retreating back to the medium through which they're usually most successful. "If I can put things eloquently enough, perhaps they'll understand why I did what I did."
It's not dissimilar to some of the ripped athletic types I'm friends with that try and use their size to an advantage even when the situation definitely doesn't call for it. If a tongue-lashing or an ass-kicking is the immediate gut response, it's probably not the most pragmatic, I've found.
I think even more so than “If I can put things eloquently enough, perhaps they'll understand why I did what I did.", it can be motivated as “I don’t think I’m a bad person and I didn’t intend to cause harm; if people are still mad at me, it must be because they don’t understand and I should explain harder.”
It can also be a case of "If I can put things eloquently enough, perhaps they won't understand and give up.". Sometimes it's a defence mechanism to think "if I can't explain myself it's because I'm so much more clever than the others. "
Isn't there regulation that requires retention of data like this? That's why it's common to see messages along the lines of "we should meet in person to discuss this further".
In fact, how does data retention rules specifically apply to apps that don't have large data retention or specifically have no data retention. Besides just making it harder to operate, are there penalties for companies using things like free version of Slack with short windows, or Snapchat/Telegram/Signal with self destructing messages?
In the bank I work in, we were fined $200M along with many competitors, because we didnt keep whatsapp records for 10 years, which impedes transparency during timeline reconstruction for investigations.
Yes there is. Hence the attorney client privileged header for sensitive matters. and. General sense that sensitive topics should be discussed over a non recorded medium. Mostly because they could be taken out of context at a future date
I find his constant reference to "putting things in the congressional record" quite interesting, as it's normally the congress members who say that, not the witnesses and even less those accused of fraud, who are here to answer questions, not commandeer the record keepers.
Has he? I know he was scheduled to testify but he didn’t get the chance since he was arrested. Was this written testimony still entered into the record?
Yes, I believe committee members referred to it yesterday during the hearing and asked for (and received) unanimous consent for SBF's statement to be put in the record.
They also commented at the utter disrespect for Congress by starting off written testimony with the phrase “I fucked up”. There’s no need for language like that and including it in written testimony is beyond stupid.
It is very obviously a manipulative tactic. It is almost at the top, which is the point in time everyone is listening to him.
He wants it to be crass because it is intended to be offensive, not very offensive, but just offensive enough that it sticks in peoples minds for a bit longer. He wants it to stick because it is his only defense and every second his audience are considering how disrespectful he is, they do not think about how he is lying.
The problem with "I fucked up" is not the language, it is the fact that it is false. And if congress is commenting on the former, but not the later, it had the intended effect.
I do not think so. The point is to create a negative impression around the phrase, so that the focus is moved from the truth value of the statement to the totally irrelevant question of it being offensive or not.
I don't think starting off with "I fucked up" shows contempt per se. It's the fact that he's at this hearing to basically explain how he fucked up, and his testimony explains this by... blaming everybody but himself, and pleading for the opportunity to fix stuff. In that context, he's trying to show sincerity and humility and honesty with a candid expression that it was his fault only to undercut by actively avoiding demonstrating any fault. The belief that anyone, much less Congress, is going to find that credible... that's contemptuous.
"I messed up" would be one example of a less distracting way to convey the same point. Persuasive writing, which SBF presumably desires to employ in this document, should never distract the reader from its thesis and ultimately its call to action.
SBF wants to persuade the reader of his thesis, which appears to be that he was acting in good faith and continues to advocate for his customers who are being materially harmed by the obstruction of the chapter 11 team. And his call to action is for his readers to help him resolve his disputes with the chapter 11 team.
Considering these goals, not only is opening with "I fucked up" a counterproductive phrase and a wasted opportunity for a more effective opening, but the rest of his testimony is even less persuasive on its merits alone. I'm not sure he advanced his progress toward either of those goals with his testimony.
But I do think he will find sympathy from some libertarian crypto advocates (at least those who can get past their suspicions that SBF is controlled opposition from a cabal of corrupt bureaucrats intent on regulating exchanges and introducing central bank digital currencies).
It's interesting to me - pervasive expletives are so common now that you almost can't share otherwise inoffensive stuff with your grandmother half the time. I'm becoming a middle aged person who dislikes cursing... lol.
Depends on if it was genuine or not. "I fucked up" conveys something different to me than "I made a mistake". If it were written by a lawyer, "I knowingly committed a fraud for which I am deeply ashamed and accept full responsibility for my actions" just comes across as being insincere. Maybe it's the time we live in, and also knowing the individual's manners. The lawyerly phrasing always comes across to me as someone saying the things that they think people want to hear. Someone telling me they realized they fucked up comes across as much more sincere. It could just be me though?
Also, in today's world, I hold people in contempt that hold congress in respect. So what makes them feel disrespected isn't that high of an "ooooh, burn" kind of moment to see they felt slighted.
> in today's world, I hold people in contempt that hold congress in respect
Is that because you don't believe that most congressional representatives act according to the will of their constituents? Or because you don't believe that the will of most constituents is worthy of respect?
That's a decent question. Mainly, I feel like most congress critters should be required to wear patches of their corporate sponsors like NASCAR drivers. That's who I feel they represent much more than their constituents. In that sense, I feel they get no respect from me.
Don't get me started on the respect for the constituents themselves. That's such a non-HN friendly conversation.
Fair enough, thanks for responding. For the record, my belief is that you don't need to be so pessimistic - democracy is always messy, and I think the perception of corruption in the U.S. way exceeds the reality, and most reps are really trying to do what their constituents want... we just have constituencies that really want to bicker with each other. But, maybe that's just wishful thinking on my part. Good luck out there!
> I think the perception of corruption in the U.S. way exceeds the reality
So the stacked Supreme Court issuing absurd rulings is not actually corrupt, but just appears corrupt?
Citizens United and further erosions of campaign financing laws that give corporations direct access to politicians isn't actually corruption, just legal free speech?
My belief is that you have to be beyond naive to hand-wave away the current generation of bad-faith politic
I said the perceived corruption is bigger than the actual corruption. I didn't say "Citizens United is a good ruling." Not sure why you leaped to that.
But, since you brought it up, can you point out any laws passed since CU that were pushed by lobbyists, but were broadly unpopular with the general public? Or laws that failed to pass due to a lobbying effort, despite being broadly popular with the general public? Anything were we can trace this supposed corrupting effect of direct corporate influence and see a result that is actually contrary to what the electorate wants?
I agree it was a bad ruling and should be overturned, but I don't think the doomsday scenarios predicted after the ruling have actually happened. I'm open to being proven wrong though, show me what you got.
Supreme court doesn't pass laws, so we're crossing the streams of two subjects in the same comment thread.
The Supreme Court has decided that corporations are people and we're dealing with the aspects of that. The Supremes then decided that civil rights were okay to no longer have protections, so we're now dealing with that. The Supremes decided that men get to decide what health care women can have.
Why would Congress need to act when the Supremes are legislating from the bench on their behalf, only they don't take the hit because it was the Supremes that did it.
Do you think that a ruling that went 7-2 and 8-1 in the past being reviewed for a third time for some reason that happens to go 6-3 along party lines makes sense in any light besides corruption and "legislating from the bench"? Please discuss.
>>They also commented at the utter disrespect for Congress by starting off written testimony with the phrase “I fucked up”. There’s no need for language like that and including it in written testimony is beyond stupid.
While I agree that he shouldn't have used those words, I certainly wouldn't in any communications, I am not sure there is anyone in congress that is actually deserving of respect; morons everywhere you look.
> i) We signed an LOI that prevented us from talking to other potential investors as long as the negotiations with Binance were ongoing.
> ii) During that time, I received serious expressions of interest from multiple potential investors who represented billions in capital that could have gone to customers. I was inhibited in responding by the LOI.
and then:
> 5) At roughly 4:30 am on November 10th, 2022, against my better judgment, I clicked on a Docusign link that would nominate John Ray as the CEO of various entities.
> 6) Less than 10 minutes later I received a potential funding offer for billions of dollars to help make customers whole
I never read what this guy said before this meltdown so I can't actually judge for myself, but, were there signs that this clown was there? these are toddler-level lies.
> ...I received a potential funding offer for billions of dollars to help make customers whole
Even if they were made whole, there would still have been fraud. A crime doesn't disappear because you tried to rectify it on your own, though you might get let off the hook a little.
It seems like all of these offers were about as likely to go through as the binance one. It isn't really surprising that there would be a lot of parties interested in taking a look at doing an offer. None of them were going to invest after even a cursory look at the finances.
First page basically said he is so sad he didn’t have time to clean up more evidences. And “pinky swear, I promise US citizen/ residents won’t be as fucked”. How cute, and I want to see the version of this he would write when an EU or non US country try to charge and extradite him.
I think they're more than happy to let the US foot the bill for the criminal trial. I'm sure there will be plenty of civil lawsuits flying in from all corners of the globe though.
> “pinky swear, I promise US citizen/ residents won’t be as fucked”
As of now, there is no indication that this is actually true as far as I am aware. So other countries don't really have a better case and there is hardly any money to be reclaimed from him.
> I would like to start by formally stating, under oath:
> I fucked up.
The second quote is a pretty apt summary of what feels like roughly half the document (I didn't specifically count pages)--there's a lot of criticism of the Chapter 11 bankruptcy team, especially that he felt they were ignoring the offers he had received to keep FTX alive.
Indeed, to the extent that it's a misrepresentation of the testimony, it's because it doesn't refer to another key focus of the testimony "it was actually CZ's fault!"
The "f*cked up" quote comes straight from the document, though.
I was about to comment on how delusional SBF must be to be this deep in trouble and not snap out back out to reality, leaving aside that "edgy teenager" or whatever mien he's been exhibiting. Is he actually aware of his situation?
Perhaps the move to Fox Hill will help him come to terms with what he's done.
I am aware that "I fucked up" is a direct quote. The latter statement is not. Don't feign quotes from people if what you're dealing in is not actually a quote. This isn't hard.
And nothing changes the part where the parent comment is a low-effort, Twitter-tier, bandwagon shitpost crafted for lols. It doesn't belong here.
You're unable to recognize, apparently, the perverse irony in saying this even while you're saying it.
(And you're wrong; it is everyone's responsibility to make sure that the level of discourse on HN meets an acceptable standard. Making up snarky quotes in contravention to requests not to do that—with or without a reminder about doing so—does not satisfy that standard.)
* * * * *
> make sure you're following HN's guidelines while posting. There has been a drop in comment quality lately. Not cool.
> Here's the short version. Good: thoughtful, curious conversation. Bad: snark, fulmination, and flamewar.
Excuse my ignorance, but isn't the chapter 11 team supposed to be impartial and not connected with the previous "managers"? He seems to be whining about how they're not asking him for advice and help - wouldn't that be opposite to their purpose?
Bla bla bla "I fucked up" Blah blah "But ultimately it's everyone elses fault and my only mistake is being the CEO while other people screwed me" Bla bla bla
It's really remarkable to me just how often this guy gets offered several billion dollars just when he can't take it. It's like people can sense he's signed a document preventing him from taking money and then inexplicably jump in and start making it rain.
Here's a gem: While a multi billion dollar implosion is being investigated, potentially hundreds of years of jail time being handed out, millions of victims. Self-disappearing messages and basically no documentation, he just got caught admitting to co-mingling funds on tape, and getting dragged in front of congress, SBF is bothering the Chapter11 team to give him the password to his linkedin account.
You linkedin account? It's like the end of the (excellent) Scrubs episode "My Screwup": "Where do you think we are?".
One of us is not understanding the situation, and I don't think it's the grownups.
I also think it makes perfect sense for them to not give him the password to his Linkedin account. They don't want him to log in and delete his chats. Obviously Microsoft has backups, but it's just easier to ignore him.
Yeah. Imagine the risk that would be for them, if it caused evidence to be lost.
There's nothing to gain, and everything to lose. Even if there's minimal chance of anything being there, the mere perception that evidence could have been lost would be damning.
Wow. He is delusional. He can't understand why the Chapter 11 team won't talk to him. He's toxic waste. He's headed for a very long prison sentence. They want absolutely nothing to do with him.
Nowhere in these pages and pages of teenage mumbo-jumbo does he talk about this little fact of using customers' money for his own purposes (that's the fraud part! important! you didn't tell clients that you'll take their deposits as donations!). The dude is still in so much denial.
“ Mr. Madison, what you’ve just said is one of the most insanely idiotic things I have ever heard. At no point in your rambling, incoherent response were you even close to anything that could be considered a rational thought. Everyone in this room is now dumber for having listened to it. I award you no points, and may God have mercy on your soul.”
I'm curious about what kind of connection FTX had with the World Economic Forum. Apparently WEF had a webpage dedicated to singing FTX's praises, and then promptly deleted it after November 8th. [1]
I'm not buying it. Nobody needs to "orchestrate" anything like this in unregulated markets. It's not like this style of scam was unheard of before FTX this one is just bigger scale
It's interesting how the conspiracy theorists suddenly come out of the woodwork when there's a fraud perpetrated by a Jewish person. I wonder why that might be.
You never saw the same vitriol towards Elizabeth Holmes, except the typical misogyny.
I'm so tired of having to listen to and read SBF's lies. If Alameda made bad bets and blew themselves up, then Alameda should have been liquidated and that should have been the end of it. Sam acts like it's normal that one customer blowing up (Alameda) would take down FTX. Of course, that's not the case, since individuals and funds blow up every day trading with leverage without collapsing exchanges.
There's no way all he has left is $100k in his bank account. I bet he has a lot of money left and he's hiding it. Maybe he didn't expect the empire to collapse this quickly, but it's clear that he knew about many problems.
The point about the lawyers essentially awarding themselves business, and that informing their advice.
Also I do find it somewhat credible that he drank his own cool-aid.
Important disclaimer: I would never associate "price of token goes up" with "value was created". The only way to create wealth (sustainably) is to create value in the world & capture some %age of that value.
However, I do somewhat believe that he may have thought the many-year run of on-paper profits was more material than it actually was. In the same way that many gamblers believe they have a system, etc.
But a lot of the points he makes about the role of CZ and the bankruptcy lawyers are quite correct.
People will do the usual thing: talk about SBF in hushed tones, FTX goes bankrupt, well the guy is just a total idiot...and I agree, the guy seems like a total idiot, the interviews, the way he is behaving now...it is childish. But he is also saying stuff that is quite correct (for example, pointing out the Sullivan Cromwell immediately took their $4m but ghosted him when he was trying to talk about an offer...whether it was true or not, Sullivan Cromwell had a responsibility to check, they didn't, and they didn't because they will see way more fee income that way...I have seen this happen over and over).
The world has to be black and white in these cases, but isn't. I have no doubt that SBF committed crimes but I would gently point out: the bankruptcy lawyers have a vested interest in certain questions not being answered immediately, Ray is working at $1.5k/hour, and will be billing 10+ hours a day...for 5+ years if they are able to...$15k/day...again, FOR YEARS. That is, potentially, $20m+ of basically guaranteed income. The business is exceptionally profitable and these people are skilled in milking these cases dry (to the cost of creditors, these cases are...contrary to what people think...not terribly complicated, even with Lehman a lot of the claims were sold on...it was an international business though, so you had global law firms sink their teeth in hard).
As another commenter alluded to above: blaming the bankruptcy team?
The horse has bolted. The fact it got to that point is the point, not what happens afterwards. The fraud and whatever else has already been committed.
Anyone pointing fingers at the bankruptcy team are attempting to distract from the core issue (which is precisely why SBF is doing it - don't look at the monumental mess I made, look how badly they're trying to clean it up).
Just because SBF is the villain, doesn't mean all of his enemies are suddenly our friends (contrary to the popular saying). The world works on incentives, and bankruptcy lawyers are incentivized to maximize billable hours. While I have no doubt they are doing their job and doing it well, they are almost certainly not doing it in a hurry.
What? In theory, the bankruptcy team are the "good guys" because they are working on behalf of the creditors, not because they are at odds with SBF. SBF is who put SBF in the position of being at odds with customers.
I'm not arguing against you. I'm arguing against the reality that most people struggle to differentiate between shades of gray and down-voted the parent simply because he wasn't unequivocally bashing SBF, and dared to comment on some other complexities of the situation. If SBF tweeted the sky is blue, would you refuse to believe it simply because SBF is a fraud?
The bankruptcy team is working to fix his mess, but they are first and foremost working for an hourly rate.
Whistleblowers, by definition, blow the whistle on something that otherwise would not have been discovered. But, Caroline was complicit in the scam even as the whole thing was blowing up. Remember - she offered to buy Binance's FTT stake during the so-called "bank run".
At best, she'll get a lighter sentence for co-operating. There's no chance in hell anyone will outright pay her for whistlerblowing.
What are you talking about? The SEC just announced their charges against SBF yesterday. They are nowhere near either a conviction and sentencing nor a settlement. It is impossible for the $20 million award you linked to be in any way related to these charges.
This reads as if he wrote this himself with no legal supervision. Is he under oath with these statements?