On Friday, cryptocurrency exchange FTX Trading Ltd. and 134 affiliated firms filed for bankruptcy protection, and CEO Sam Bankman-Fried resigned as CEO, turning over control to John Ray III, who also oversaw the liquidation of Enron Corp.
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Bankman-Fried, evidently in the Bahamas, disputed Reuter’s characterization that the funds were secretly transferred but did not offer an alternate explanation or account for the allegedly missing funds.
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Hughes observed in his letter that speculators would get better investment results from gambling in a casino, where a mere 56 percent of players lose “come” bets in craps or 58 percent lose playing basic strategy in blackjack.
Retail Bitcoin investors don’t appear to be getting those odds.
" In hindsight, Sam Bankman-Fried’s April interview with Bloomberg’s Odd Lots podcast was a harbinger of his epic collapse last week. He described a “box” that has value only because other people put money in it, and, when confronted with the idea that he described a Ponzi scheme, admitted there was a “depressing amount of validity” to that."
—Sam Bankman-Fried’s Magic Money Box Enriched Vast Crypto Network (paywalled link)
the people who put the money into the box are the retail investors…
And yet - supposedly brilliant financial industry leaders put money into this Ponzi scheme. How did they not see this?
Everyone believes there’s a greater fool somewhere out there.
Timing the fools market is tricky.
A bunch of them were just stupid and got scammed. They bought the sizzle.
Never hang on to the sizzle when you’re playing a game of Hot Potato.
Neat! A sociopath’s understanding of wokeness!
The next dominoes falling: Genesis, Gemini, BlockFi,…
Start queuing up Binance.
https://www.cnn.com/2022/11/16/business/crypto-contagion-genesis-ftx-ctrp/index.html
Of course, major players in the crypto space are rushing to distinguish themselves from FTX and other firms that have gone bust in the past year as token prices have slumped.
One is Brian Armstrong, the CEO of publicly traded exchange Coinbase, who told CNN’s Julia Chatterly on Wednesday that even though the fallout is hurting the industry now, it may ultimately be a positive for companies like his.
Sam Bankman-Fried’s failed FTX business empire misused customer funds and lacked trustworthy financial statements or any real internal controls, according to the new boss of the collapsed $32 billion crypto exchange.
John Ray III, a veteran insolvency professional who oversaw the liquidation of Enron, said in a US court filing on Thursday that FTX was the worst case of corporate failure that he had seen in his more than 40-year career.
“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” he wrote.
…I’m surprised it is still worth that much. I mean, on their own these are just vaguely unpleasant drawings. All the value came from the expectation they would increase in value. Are people still really willing to bet thousands on that?
