This was a fantastic look into the on the ground proceedings of FTX's crumbling, something that I have been curious about, as I wondered just how these things occurred (who initiated what) in a timeline fashion. I chuckled at John Ray III just straight up ghosting Sam Bankman-Fried. It is clear that Bankman-Fried is just off his rocker, potentially partially due to the habitual abuse of drugs, but it's also probably because of his elitist upbringing coupled with narcissism.
While this article is about the end days, I still see almost no publications addressing Sam Trabucco, who suspiciously left Alameda before all this blew up (I suppose it was blowing up internally already). I get the feeling that some of Bankman-Fried's close circle knew what was going on while others just got railroaded by him and were just plain incompetent versus fraudulent and incompetent.
This is an interesting look into just how pervasive the "fail fast and fail until you make it" mode of operation has infiltrated startup culture. While of course not every startup is committing fraud and FTX is a particularly striking example, I do think that it's an internal look into just how incompetent a lot of startups might be.
Wow. A story of children running a crypto fantasy and the adults who worked for them, desperately trying to stay out of prison.
Amazing what happens when reality ablates the layers of fictitious superiority and genius, and you’ve got lawyers on many continents banging on your door, trying to entice you with soft words to make the only obvious remaining move.
> “Bankman-Fried privately fumed about what he considered “the adults’” broken promises, namely, to consult on fundraising efforts and the appointment of directors. Over email, Bankman-Fried appealed to Ray for a role in the company’s unwinding.”
Amazing. He didn’t even realize the adults were just trying to get the gun out of his hands and that there was no way in hell anyone would let him near anything after they had it.
The one thing that stands out to me, that makes him unlike his contemporaries, is that he seems to be capable of empathy and understanding for those who abandoned FTX and why the thing went the way it did. He has that “maybe I’m the one who is wrong?” moment that others seem to be incapable of.
I’m not suggesting I think he’s innocent, but he seems more like an idiot than a sociopathic fraud.
This man is 30 years old and committed fraud on a global scale with open eyes. Please stop calling these company executives "children", distinct from "adults" even if that's how they try to downplay ther own culpability.
That’s not what people mean or intend when they call them children. They’re referring to how he has no idea what he’s doing and isn’t making adult decisions.
Indeed, he seems very culpable. He should be treated and prosecuted as an adult. But he is very childish in his actions and behaviour.
SBF is the original author of the “adults” vs “children” narrative, according to the article.
It’s an incredibly savvy legal strategy and PR move on his part, because if these are just “incompetent kids” then maybe a jury will believe SBF isn’t actually a dangerous sociopath who was caught stuffing billions of dollars into his pockets.
His parents are abetting this pathetic defense and uncritical journalists are amplifying it with puff pieces like this article.
1: Admit to himself that he was incompetent, stupid and greedy. Admit he wasted a huge opportunity. Admit he may well spend the rest of his life in jail. Admit others tried to stop/warn him and he ignored them. Accept that the buck ultimately stops with him. Accept that almost everyone now has to testify against him.
2: Keep pretending nothing happened and everything was overblown and pretend people will eventually realise this despite all evidence and logic.
I see a surprising number of people pick option 2 in this case. And it often works: people get bailed out. Everyone loves an underdog. I don't think it will happen for SBF. But it's a weird mix of flawed and brazen logic and group and individual Psychology and politics...
The fact that a person can spend a life in jail without having physically hurt another person is grotesque, though his case is obviously not the most egregious.
Enh… I don’t think I agree. Financial fraud can do serious harm.
I’m also not sure why there’s a sense that the crime has to be violent to deserve such a sentence. Imagine if I methodically went house to house, ensuring everyone was safely out of it, and then liquidated the house until there was naught but a hole. And I did that thousands and thousands of times.
Consider the alternative. In an environment where prosecution can merely inconvenience the perpetrator, every action is just the basic math of “gain - (penalty times chance of getting caught)”.
We already see that calculus in many corporate wrongdoings. It is not beneficial for the rule of law.
That is a false dilemma between 'a life in jail' and 'merely inconvenience'. For non-violent but severe crimes, single-digit years in jail seems to me as adequate punishment. Severe enough to blow away rational calculation, but not life-destroying.
Just because they don't directly wield a knife, hammer, or gun and personally extract blood does NOT mean that insufficient damage is done.
A number of the victims of Madoff's fraud committed suicide. Sure, Madoff didn't pull the trigger.
But he sure as hell enticed them to put their life savings with him, and when they were retired, had no real prospects of any new income, and were suddenly destitute with no hope of recovery, Madoff sure put them in that utterly hopeless situation, with the same end result as if he had pulled the trigger.
As they say: "If you can't do the time, don't do the crime.".
Many people are relieved and rightly so, that Madoff spent the remainder of is days and died in prison.
Some of the people he has hurt financially will no longer be able to cover medical expenses or rent. It'd be unsurprising if some number of people he impacted commit suicide over losing their life savings.
He has physically hurt people. There will undoubtedly be a body count which can directly be associated to SBF's actions.
For most people, money is quite literally their time, as they have to spend their time working for it. And since your life consists of nothing but time, time is just partial life.
He have made lots of people losing years of their life. It’s fair for him to lose his.
Enough money is worth a life. Eg when building high way safety features the engineers typically do some cost-benefit analysis that assumes a life is worth about something like 6 million USD (in the US).
Sorry, but that is a guideline not a fact. That is something we use to decide when we stop engineering something. If it was literally true then I should be able to just buy a human life or avoid a murder sentence with a fine.
Morally, hurting people is categorically worse than stealing money.
Regarding number 1 - in many countries, you still can! It used to be in the US you could too no problem, for both. Doesn't take going back very far in almost any country for it to be true.
Regarding number 2 - what happens when the money you steal was necessary for someone to survive, or causes such disruption and heartache to enough people, it adds up to more than if someone died?
Right now, things are abstracted enough, we just can't see the actual impact of these large frauds. But it's not uncommon for someone to commit suicide, marriages to end in divorce, kids to be severely impacted (sorry, no College fund for you anymore!), etc.
> Morally, hurting people is categorically worse than stealing money.
I Would rather be a victim of violence whose effects disappears after week (i.e. no long-term effects) than victim of theft of money equal to my yearly income.
I actually think the opposite: people commit huge frauds, stealing money that could have saved 100s or 1000s of lives, and then get suspended sentences.
Ironically for SBF, Effective Altruism itself equates such actions with murder (or at least manslaughter). And his actions were culpable too. This was not an accident or a misunderstanding or human error or bad luck. He stole (and squandered) billions.
> you’ve got lawyers on many continents banging on your door, trying to entice you with soft words to make the only obvious remaining move.
I was somewhat surprised with what seemed to be the lawyers trying to persistently but sweetly beg him to sign the papers. I would have imagined the lawyers using much stronger words, nearing profanity-laced commands, but they seemed like a parent begging a child to eat their supper or put on their coat before going outside.
Can you imagine if Bernie Madoff had told the attorney general that he just needed a few more weeks to find new investors in order to make his customers whole.
SBF comes off as an extremely naive and sheltered kid who doesn't understand that committing fraud is still fraud even if you have good intentions.
Similarly, can you imagine the media not objecting to Madoff using euphemisms like SBF does, e.g. how he "just needs liquidity" or just needs some support for his "capital position"?
Ok let's see...yes it appears you care. As you said, "You act like if you walked the streets of NY after 9/11, making jokes about it, people would be cheering you on... I have a feeling the situation would be quite different"
There are better jokes and worse jokes, I didn't think that was news. But I guess it is for you. You also quoted a hypothetical joke someone raised as an example in a specific context, to which I think my reply was spot on and in no way conflicts with what I wrote here. But, hey, they are both "jokes" so you must have done a really good job.
You aren't the person I told I didn't care if they wanted to be humorless or not...
What does it have to do with you at all?
I don't care if you want to be miserable and humorless either, but I'm not sure what that has to do with my responses to you at all?
I'm going to be honest when I say that I'm not quite sure how you can be this confused about this conversation. Like, did you seriously think that me caring if the particular poster appreciated jokes had any bearing on any other joke I ever liked ever? It's beyond me what you think you are getting at. Maybe take a step back and think about this situation instead of trying to get a "slam dunk" on my by using my words back against me.
> We're trying to slow the reddit/diggification of HN.
Then stop posting like a petty 5 year old that's intent on getting a dunk by using a person's words against them in completely nonsensical fashion that literally does not make sense!
While this article is about the end days, I still see almost no publications addressing Sam Trabucco, who suspiciously left Alameda before all this blew up (I suppose it was blowing up internally already). I get the feeling that some of Bankman-Fried's close circle knew what was going on while others just got railroaded by him and were just plain incompetent versus fraudulent and incompetent.
This is an interesting look into just how pervasive the "fail fast and fail until you make it" mode of operation has infiltrated startup culture. While of course not every startup is committing fraud and FTX is a particularly striking example, I do think that it's an internal look into just how incompetent a lot of startups might be.