Rant: I have lost so much faith in our institutions’ (especially every federal org) ability to be objective in fulfilling their mission, that they’ve become so brazenly and unconditionally partisan, that I’ve come to the conclusion that SBF’s cozying up to so many of the right people on the favorable political side means that he’ll never see a day in jail, as unfathomable as that is. He’s embarrassed so many people that the pressure to sweep this whole disgusting mess under the rug will be enormous, and the fact that it’s now three weeks later and he’s still just walking around out in the open is strong evidence of this. You can see it every day in the reporting from the media, who describe this giant con as if it was a legitimate enterprise that just sorta - oopsies!! - went awry through poor judgment and silly hijinx. The whole thing was a fraud and STILL no one with a real voice is saying so. I have no words. This has a high likelihood for marking the time when rules just officially stopped mattering, no sin too large, if you can game the system politically.
> he’ll never see a day in jail […] and the fact that it’s now three weeks later and he’s still just walking around out in the open is strong evidence of this
It really only seems that way because people have amnesia about the timelines involved in accountability for similar events; Enron collapsed in December 2001 (well, that’s when the bankruptcy was filed, Ken Lay resigned as CEO in January 2002.) It wasn’t until February that there were hearings in the Senate. The first indictment related to it was in March ’02 – for Arthur Andersen, Enron’s accounting firm, who were convicted in June ’02. Enron’s CFO was indicted in October ’02 and convicted in a plea bargain in January ’04, and Ken Lay wasn’t arrested until July ’04 and was convicted in May ’06.
SBF being out free three whole weeks after the SBF collapse is not strong evidence that he will never see a day in jail and other accountability. So far, that have been public, there were separate probes of FTX and/or FTX.US by at least CFTC, SEC, and DOJ in progress before the collapse, and there are more institutions in more countries targeting FTX and its principals now.
The NYT began publishing legitimately scathing articles about Enron and effectively accusing outright fraud in January 2002 [1].
Contrast to the kid-gloves puff-piece the NYT published about SBF recently.
If we take the NYT as a bellwether for what the "elite" and well-connected want known, it's quite clear that the treatment is very, very different between the two collapse stories.
My personal feeling is that SBF is not permanently safe. Like Epstein, occasionally you have to sacrifice one of your own to sate the appetite of the masses and to quell the tendency of conspiracy theories to be demonstrated correct. Depending on how uncontrollable narratives evolve on this story, it's possible they'll need to throw him under the bus.
For the moment, however, it's clear they're treating this as Not-Enron. He's safe for now. We'll see.
> The whole thing was a fraud and STILL no one with a real voice is saying so. I have no words. This has a high likelihood for marking the time when rules just officially stopped mattering, no sin too large, if you can game the system politically.
There is a difference between knowing and proving. The gears of the legal system can move slowly, but deliberately. With this much money on the line, you don’t want to quickly jump to conclusions. It’s better to figure would what happened first and then determine the best path forward.
But I think your main question is actually the point of this page/token/article. What if nothing happens? What if it just gets swept away? The point of the token being - let’s see what happens in a year. Keep pressure and visibility up on this. At the end of 2023, let’s take stock and see what has happened to unravel the what was really done with the money from FTX... and what the consequences are.
People were saying the same thing about Holmes and Theranos and yet here we are with her sentenced to 11 years. Sometimes prosecutors move slowly because they need time to build a solid case. Working quietly behind the scenes might look like inaction but I wouldn't be so quick to assume so.
Having politicians as friends only helps when one is not radioactive. Pulling strings can sweep minor problems under the rug but this is a giant problem, and I suspect SBF will find that all his donations won't buy him anything given his current predicament.
I have completely lost any sense of trust in major media institutions after this. Seemingly every outlet accepted a ton of money from this guy, and in turn wrote very favorable articles about him. To me, there are two possibilities. Either all these outlets didn't do a minute of digging into where all his money came from, or they knew it was all a scam and took it anyway. So it was either a complete and total journalistic failure, or they were complicit in the fraud.
The mainstream media does not deserve the benefit of a doubt anymore. From this point forward, I am going to assume that anything published by the NYT, the post, the WSJ, any of them, is either purposefully misleading or just a bold-faced lie.
Does anyone have any good reasons why this is illogical? I really do not see a reason why we should think any of these people are trustworthy.
I've also seen the argument that this is just "run of the mill journalism", in that it's totally normal for an outlet to run puff pieces if they get paid to do so. But doesn't that completely undermine the integrity and trustworthiness of the outlet writing the pieces? If any rich guy can just buy positive press without any scrutiny, why should we give them our trust?
Journalism is supposed to be about digging up dirt on the rich and powerful so that us peons can get mad when they do bad stuff and make sure our government to punish them. This scandal is so massive because it involves journalists and government actors working together to make sure that didn't happen with SBF. How is anyone supposed to trust any of these people ever again?
The people who received money from SBF failed to tag him as a fraud but also the people who gave him money also failed to tag him as a fraud so the parsimonious explanation right now is incompetence, not malice is what's been driving the situation.
I just don't buy it. I just can't believe that all these hundreds of millions of dollars moved between all these entities without anyone understanding what was really going on.
> Journalism is supposed to be about digging up dirt on the rich and powerful so that us peons can get mad when they do bad stuff and make sure our government to punish them.
The vast majority of journalism articles have never involved any of that. They are there for informational purposes. You get a few investigative pieces with a much larger helping of lighter fare.
>the fact that it’s now three weeks later and he’s still just walking around out in the open
It takes time to run an investigation. Since FTX is not a regulated institution, it may in fact not be a fiduciary for its 'customers'. It's not black and white from a legal perspective and will take time to unravel. The fact he's still walking around means the US isn't a banana republic that just locks people up by popular demand.
I don't think the fact he's walking around in necessarily evidence of corruption, so much as it's evidence of governments (and there are multiple jurisdictions here) being slow to act.
As to the idea that connections will always get you out of trouble, again I don't think that's universally true. Elizabeth Holmes is extremely well connected as was Bernie Madoff but that didn't stop either of them being prosecuted and convicted.
My guess here is that once the dust settles on exactly what's happened with FTX (which is still unclear in a lot of ways) SBF will be charged.
I wonder what the time-to-arrest was on Madoff from his scheme collapsing? Have we just become too accustomed to operating on Internet time when these things always take months?
> I wonder what the time-to-arrest was on Madoff from his scheme collapsing? Have we just become too accustomed to operating on Internet time when these things always take months?
Ken Lay was Dec 2001 -> July 2004
Madoff was very quick from the collapse to arrest (December 2008 for both), but that’s largely because he confessed to his sons and told them he planned to surrender to authorities, who talked to the FBI, who visited Madoff who then confessed that it was “all one big lie” to them.
> If only SBF had confessed on Twitter about stealing customer deposits…
The reason it was fast with Madoff wasn’t the confession, per se, it was that it came with the telegraphed (and actual) intent to surrender to the authorities.
Though I suspect SBF’s inability to control his public statements is an indicator that it is likely to be quicker to line up things against him than it was against Lay, its not going to be as easy as with someone who was burned out and done fighting like Madoff.
I mean the authorities had no trouble getting a federal search warrant against me merely because a LEO fabricated a story that a dog alerted on me. They woke up a federal judge, in the middle of the night, within several hours and even convinced the judge to waive normal hours for serving the warrant. Yet they can't quickly get one for SBF?
Definitely some people are more equal than others. And I realize he is in the Bahamas.
----------
re: premise below
There is plenty of non-fabricated probable cause for SBF, pretty much all of below is a false premise.
> I mean the authorities had no trouble getting a federal search warrant against me merely because a LEO fabricated a story that a dog alerted on me. They woke up a federal judge, in the middle of the night, within several hours. Yet they can’t quickly get one for SBF?
A search warrant needs to specify a particular place to search and particular things to search for. So, even if there was an LEO that was going to fabricate evidence to support such a warrant…what would they fabricate evidence to point toward that would actually be useful?
Also, while it may not have mattered to the LEO fabricating evidence against you–assuming your story is accurate–it may be that the particular folks involved in the SBF investigations are less willing to commit crimes of their own to advance it, if not for ethical reasons, potentially because the attention to the case and the resources likely to be deployed by the defense make it rather more likely than in your case that either (1) such a crime would result in criminal consequences for the government agent committing it, or (2) manufacturing evidence would compromise any prosecution of SBF.
While it is very likely true that it was fraud, any media company with enough money worth suing will not say so. This is because accusing someone of fraud is a great way to get hit with SLAPP suits. If you want to keep your legal costs down, you just don't do it. They will wait for the FTC to do the accusing and then report on that.
I suppose I'm supposed to "both sides" this, but do you remember when we elected a conman to the top of every federal org you're despairing of over now? (He was fresh off a civil loss of what? $20 million dollars he had to pay victims of his scam university.) Do you think that maybe that has consequences?
And who appointed the judges those prosecutors will need to prepare cases for and convince? Which party is the party of deregulation (particularly financial deregulation)?
Do you think conservative judges aren’t receptive to fraud cases? Republican appointees regularly give the longest sentences to white collar criminals. Your comment is clearly written about someone who actually knows nothing about law except what the political media prints. And no one has deregulated or legalized outright fraud, which is what happened here.
Do you have this stat? conservative-aligned judges do give harsher sentences to white-collar crimes? Because in my country, this is pretty much the opposite.
They even bail them out of prison for "medical reasons" and then we can see them on the dancefloor at christmas. Hopefully we'll get US-like gun laws (and US will uban sniper rifles and sniper AP rounds, as their mass killing power is low).
That has to do with questions of what exactly the law prohibits. A lot of white collar law deals with the very murky line between sharp, but legal, business practices and prohibited conduct. Those kinds of issues don’t usually rear their heads in other kinds of cases, which instead tend to be contested on adequacy of evidence and criminal procedure (Miranda warnings, illegal search and seizure, etc.) grounds.
Worse, I've already started seeing whispers and hints around the internet of this event being evidence of conspiracy of a certain ethnic group that both Bankman-Fried and Gensler are a part of.
I don't personally put any credence into this very old and ugly conspiracy, but given the recent surge of attention to it by other unhinged actors, if this kid doesn't get thrown under the bus and burn, the meme is only going to grow much stronger legs to run with.
This is a dangerous moment, and the elites need to be aware that people are watching to see what they do when it's one of their favorite sons who crosses the line.
Well it's not really a "conspiracy" that Jews are one of if not the richest of the significant religious ideologies in America. Friends/family/mutual aid often goes along religious lines so it wouldn't be surprising to find out some of the investments look like a "jew-fest" as SBF is after all Jewish, and his family probably knows lots of Jewish people who happen to be about the richest families by religion in America on average.
If someone is a rich bad person, they are disproportionately likely to be Jewish. If they are a rich good person they are also disproportionately likely to be Jewish.... but some only see the bad.
The "meme", as you put it, has been around for centuries. The people who believe it will just blame the Jews for something else. They have never needed evidence before.
I completely agree. But when there are actual events that look like 'evidence' the meme becomes more easily transmissible, and more difficult to remove from the infected.
It's not so much that he was cozying up with them as it is that they were one of them. I think the reason SBF ultimately succeeded and disarmed investors' critical eyes is two-fold: he had a pedigree of Stanford/MIT and thus isn't a complete idiot so he could spin together a temporarily believable narrative even if they were on shoddy ground; the second and more important reason is that his parents were both Stanford professors and Caroline's dad was an econ professor at MIT, both the parents had a an expanding list of contacts which helped them secure the first critical set of funding rounds and further on had them ably play the dance with political players and regulatory bodies.
Anyway, the lesson I got after seeing SBF's philanthropic forays, which were all a ruse, was to never trust a techbro no matter how inspirational outwardly they may be. Ravening wolves they are the lot of them, in sheeps' clothings.
Did you also know that his mother founded a democratic superpac that prides itself on being secretive? It seems like this is a really important detail that everyone is overlooking/ignoring.
And FTX execs gave a lot of money to Republicans as well. People making this a partisan issue are the real problem.
>“Among the three executives, $57 million was given to Democratic candidates, while $22 million went to Republican candidates,” opensecrets.org details. “Bankman-Fried was the second biggest Democratic-leaning megadonor and Salame was 10th largest Republican donor this election cycle,” the report adds.
I am not being partisan, I am just trying to point out that there is a democratic superpac involved in all of this, and I don't see it being talked about much. I'd like to see everyone involved be investigated thoroughly.
I will admit this is all pretty upsetting to me though. I'm a very left-leaning person, and to see the party that is supposed to represent my values doing this stuff and then everyone making claims along the lines of "well everyone does it" is very disappointing.
I'll make sure to add a "I am not a republican" disclaimer in the future.
Ok great! If they're implicated in this, then by all means, let's go after them. I just can't help but notice a pattern of left-leaning media outlets going really easy on this whole thing because a lot of democrats are implicated as well.
I know this is cliche and I honestly hate saying it, but can you imagine if SBF some guy with two deeply connected republican parents, one of whom founded an explicitly secretive superpac for republicans? Don't you think the reaction would be a bit different?
I truly don't understand this offering, especially since it appears the coins become worthless when he goes to prison, at the statute of limitations, or the death of SBF (whichever comes first). Since all eventualities result in a loss, why would you even buy it except to ponzi your way to riches and glory?
Is parody an option? That was the original idea behind Dogecoin after-all, but I suppose the lesson there is that you probably shouldn't mix parody with crypto because someone will still buy it.
I think parody is an option. Back when NFTs were a big thing, I was going to make a website where you could "buy" a "non-forestation token". Instead of using energy and GPUs to destroy the environment, I would just go burn down the rainforest directly for you. The web interface had a map where you could choose which forest to burn down, and there were rewards for having the largest contiguous area. I got bored midway through and didn't think my acronym was funny enough (or the game was fun enough), so yeah... Obviously that's dumb but I was going to have a link to donate money to charities that work on protecting forests. It would get is moment of fame on Twitter, people would donate money, the "I hate NFT" folks would have a field day.
So if it's parody, I get where the author is coming from. (The site won't load for me, so I can't tell myself!)
Parody is definitely important. I (at least) would really have appreciated this project, and your description definitely made me laugh out loud. Thanks!
There are so many people who should be blamed for the insolvency of FTX before SBF. Like, first and foremost, all the idiots that gave their money to an experimental wacky business model. But also the government and industry institutions that didn't go "What The Actual Fuck Are You Doing, No No No No No Please God No, Stop It Now" and instead were like "Hmm, The People In Charge Think They Might Make Some Money With This, So It's Fine Please Continue".
The fact that anyone gave this dude any money, considering he literally looks homeless half the time, is enough reason to conclude everyone involved got what they deserved. If you get grifted by a homeless looking person, you deserve it, and if you are a good enough grifter to take billions of dollars while looking homeless, you are entitled to all the millions you stole. People who throw all their money at a risky get-rich-quick scheme aren't innocent bystanders (unless they're literally mentally incompetent, but I don't think that explains the sheer size and scope of crypto today; it's mostly people propping up a giant lie with the hopes that they'll profit before it topples on them).
As some people have pointed out, "dishevelled guy in tech t-shirt" is not an accident, it's a kind of work uniform as much as the business suit. You've got to look like a tech founder in order to raise money as a tech founder. As well as going to Stanford.
Even if it was a ploy, that... doesn't make things better. If you are giving billions of dollars to a disheveled guy in a t-shirt, regardless of his title ("tech founder" or "homeless utopianist"), bad things are going to happen.
Appearances mean nothing in terms of execution. Please don't cargo-cult false signals or promote dumb, discriminatory negative narratives that have nothing to do with a venture.
Being a fucking weirdo is not a false signal, it's a signal. Signals don't determine outcomes, but they signal that maybe you should pay more attention.
If you hire a 50 year old male babysitter wearing a t-shirt that says "I Love Little Girls", you could ignore it on the basis that "appearances mean nothing in terms of execution", but it would be extremely bad parenting.
We keep seeing the number 8$ billions of losses, but I wonder: does that number already include the enormous depreciation of Crypto which is taking place after SBF's demise?
What if users' possession on FTX are actually valued much less now?
Wasn't he in the Bahamas the whole time? I doubt he'll face prison time there and I thought you have to be in the US to face american criminal charges.
>I thought you have to be in the US to face american criminal charges.
No. The long arm of the US banking system extends globally. I have a friend that's a fed that chases people internationally on stuff like this. They won't forcibly extradite you w/out the host countries cooperation though. So if he pays off the right people he can stay there in perpetuity.
But... his assets can be frozen, even at the host countries bank via threat of being cutoff from SWIFT.
There's a straightforward argument to make that he criminally defrauded Americans in the US, so extraditing him to face charges in the US is certainly possible.
It slows things down, but doesn't stop them.
(If "going to prison" means convicted and sentenced, I very much doubt that could happen before the end of 2023.)
> There's a straightforward argument to make that he criminally defrauded Americans in the US
Is there? I thought the point of FTX was that it was offshore so that it could ignore american laws. I guess with FTX.us also collapsing he can be hit by those customers.
American IPs were banned from using ftx international. Yes he was advertising in the us and the us equivalent also blew up but I do think there are some complications to getting him in prison.
His parents appear to (a) be resident in the US and (b) have bought loads of Bahamian property with the proceeds, so they might be a point of leverage.
First, what are the possible charges an AUSA can file against SBF? Which of these charges can stick? What kind of evidence is there for these charges to stick.
- he goes to prison extraordinarily fast (before EOY 2023) so what? coins are burned then what? burning half the supply doesnt guarantee a liquid cashout, they're essentially becoming late-night TV collector coins.
- he doesn't go to prison, half the coins are airdropped back to holders. fucking great, two hands of shit instead of one, oh the possibilities.
> I'm a little worried that if we penalise financial innovation harshly like this (prison!) we will never get the next bitcoin, bitcoin 3.0 if you will.
Haha, Hal Finney (the recipient of the first bitcoin transaction, and probably even Satoshi Nakamoto himself) wrote about this idea 11 years ago:
"Any successful replacement of the Bitcoin block chain will forever undermine the credibility of any successor. How is an investor to know that it won't happen again?" — Hal Finney
Nobody is talking about penalizing innovation. FTX misappropriated their customers assets. If they hadn't done this SBF wouldn't be risking prison time (probably).
I disagree. If we punish financial innovation like this then maybe we'll get innovation that doesn't facilitate egregious scamming like this.
I don't happen to see why financial innovation has to require a complete disregard of all that has gone before it and a presumption that astonishing naivety and hubris are entry requirements. But then, what do I know.
I'm honestly not sure that's a bad thing; bitcoin has been pretty horrendous for the planet on a number of fronts and I'm not sure I've actually seen any value yet.
The good ones go into the pot, the bad ones go into the crop.
This is how the state does a new thing in. He lets it run wild. And if it can self-contain and restrain, have a concept of governence and self-regulation, you will get away with a lot. But crypto did not.
Crypto did not pass the test, the only thing it was good at, was destabilizing the aristocracy of totalitarian governments, by offering them monetary escape routes.
So the tech will life on in the belly of the financial institutions, the rest, well nothing of value was lost.
This is the cryptobro equivalent of claiming, "If we don't allow murder then we won't be able to kill the next baby Hitler." There's much better arguments to make than this one.
