Everthing you wanted to know about the FTX/SBF/Alameda crypto crash

[araomd]

Almost as good as Matt Levine himself:

Sadly, FTX

It has been quite a past two weeks, with different spheres in deeply divided narratives. In addition to the liberation of Kherson City, the midterm elections that of course took forever to resolve and the ongoing hijinks of Elon Musk taking over Twitter, there was the complete implosion of Sam...

thezvi.substack.com

 

[above_all]

I'm barely intelligent enough to handle Monopoly and Life money. I can't fathom putting my money into the ether.

 

[GAK9]

Verrrrry looooong read, but interesting.

 

[GodBlessTheUSA]

From, of all places, npr:

FTX made a cryptocurrency that brought in millions. Then it brought down the company

The now-bankrupt cryptocurrency exchange FTX made real money off of its own digital currency, called FTT. That currency is practically worthless now, but investors continue to trade it.

www.npr.org

"Not long after they started the now-bankrupt FTX, an exchange for trading cryptocurrencies, Sam Bankman-Fried and his co-founders decided to make their own virtual currency à la bitcoin.

"There's no reason, if you're in crypto, not to create tokens," says Hilary Allen, a professor at American University Washington College of Law. "You can create tokens out of thin air."

The FTX Token, or FTT as it is more widely known, debuted in 2019, and a couple of years later, the digital currency was valued at a high of almost $80. Today, there are almost 250 million FTX Tokens in circulation.

Not bad for something that is just data."

If I understand this correctly:
They sold something (tokens) that allowed buyers to buy and sell virtual currencies on their "exchange". Buyers weren't even actually buying bit-coin, etc., they were buying "tokens" that would allow them to buy bit-coin, etc.

Co-founders freaked at the total lack of ethics and left. The social justice warrior kept the lie going. People lost money.

A Canadian teachers' union pension fund is writing off almost a $100 million loss.

Yet somehow they were able to get a sporting stadium named after FTX, gave almost $50million in political donations, and wanted to spend over $100 in the 2024 election.

What were people buying?

A lie.

 

[Torn]

“A fool and his money are soon parted”

 

[moosensquirrel]

“A fool and his money are soon parted”

A fool and his USD-fiat currency are soon parted.

 

[JDUB]

All a ploy, fall guy included, to create government control and regulation of cryptos.

 

[Cadcom]

I have several units of Georgia air for sale. Limited quantities so you better act fast! These units of air will be vacuum sealed in clear containers for easy identification and Inspection. All limited release bags will come with a certificate of authenticity. (Cash only please)

 

[Torn]

All a ploy, fall guy included, to create government control and regulation of cryptos.

That’s what I think also. Get rid of the big exchange before they roll out the FedCoin exchange with new oversight and regulations.

 

[araomd]

As usual, Ben Hunt called it way ahead. From 2018:

"And that brings me to what is personally the most frustrating aspect of all this. The inevitable result of financial innovation gone awry, which it ALWAYS does, is that it ALWAYS ends up empowering the State. And not just empowering the State, but empowering the State in a specific way, where it becomes harder and harder to be a non-domesticated, clever coyote, even as the non-clever, criminal raccoons flourish."

Too Clever By Half

The inevitable result of financial innovation gone awry, which it ALWAYS does, is that it ALWAYS ends up empowering the State. When too clever by

www.epsilontheory.com