Obviously a Chance of Typos
November 14, 2022 12:49 PM Subscribe
FTX's Unbalanced Balance Sheet. FTX is the latest crypto-star to disappear into a black hole. Matt Levine dissects the startling balance sheet of the company. It's a tragedy to the people who got burned, but to bystanders it is comedy gold. To wit:....(archive version)
"A spreadsheet listing FTX international’s assets and liabilities, seen by the Financial Times, point at the issues that brought Bankman-Fried crashing back down to earth. It references $5bn of withdrawals last Sunday, and a negative $8bn entry described as “hidden, poorly internally labled ‘fiat@’ account”."
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"The vast majority of FTX Trading’s recorded assets are either illiquid venture capital investments or crypto tokens that are not widely traded, according to the spreadsheet, which cautions that the figures “are rough values, and could be slightly off; there is also obviously a chance of typos etc. They also change a bit over time as trades happen.”"
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" If you try to calculate the equity of a balance sheet with an entry for HIDDEN POORLY INTERNALLY LABELED ACCOUNT, Microsoft Clippy will appear before you in the flesh, bloodshot and staggering, with a knife in his little paper-clip hand, saying “just what do you think you’re doing Dave?” You cannot apply ordinary arithmetic to numbers in a cell labeled “HIDDEN POORLY INTERNALLY LABELED ACCOUNT.” The result of adding or subtracting those numbers with ordinary numbers is not a number; it is prison. "
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"A spreadsheet listing FTX international’s assets and liabilities, seen by the Financial Times, point at the issues that brought Bankman-Fried crashing back down to earth. It references $5bn of withdrawals last Sunday, and a negative $8bn entry described as “hidden, poorly internally labled ‘fiat@’ account”."
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"The vast majority of FTX Trading’s recorded assets are either illiquid venture capital investments or crypto tokens that are not widely traded, according to the spreadsheet, which cautions that the figures “are rough values, and could be slightly off; there is also obviously a chance of typos etc. They also change a bit over time as trades happen.”"
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" If you try to calculate the equity of a balance sheet with an entry for HIDDEN POORLY INTERNALLY LABELED ACCOUNT, Microsoft Clippy will appear before you in the flesh, bloodshot and staggering, with a knife in his little paper-clip hand, saying “just what do you think you’re doing Dave?” You cannot apply ordinary arithmetic to numbers in a cell labeled “HIDDEN POORLY INTERNALLY LABELED ACCOUNT.” The result of adding or subtracting those numbers with ordinary numbers is not a number; it is prison. "
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I'm not trying too hard to find it right now, but apparently the former "Slate Star Codex" writer (who I'm told is very much into "rational charity" or something like that) has gone on a bit of a wobble about how deeply betrayed he feels by Bankman-Fried, and now he's talking about creating some sort of trustworthiness index wherein he'll publicly cut ties with anyone who scores below a certain percentage.
posted by The Pluto Gangsta at 1:15 PM on November 14, 2022 [17 favorites]
posted by The Pluto Gangsta at 1:15 PM on November 14, 2022 [17 favorites]
creating some sort of trustworthiness index wherein he'll publicly cut ties with anyone who scores below a certain percentage.
My goodness. Is there anything that Big Data can’t do?
posted by hwyengr at 1:18 PM on November 14, 2022 [27 favorites]
My goodness. Is there anything that Big Data can’t do?
posted by hwyengr at 1:18 PM on November 14, 2022 [27 favorites]
Spending $5 billion of customer money on Serum would have been horrible, but FTX didn’t do that, and couldn’t have, because there wasn’t $5 billion of Serum available to buy. FTX shot its customer money into some still-unexplained reaches of the astral plane and was like “well we do have $5 billion of this Serum token we made up, that’s something?” No it isn’t!This passage is just wild. This is how high crypto has gotten on its own supply. My goodness.
posted by Wretch729 at 1:20 PM on November 14, 2022 [19 favorites]
Wonder how much of this is the NSA getting serious about stopping the flow of unregulated cash into Russia.
posted by Abehammerb Lincoln at 1:23 PM on November 14, 2022 [12 favorites]
posted by Abehammerb Lincoln at 1:23 PM on November 14, 2022 [12 favorites]
...that desperation balance sheet reflects FTX’s position after $5 billion of customer outflows last weekend; presumably FTX burned through its more liquid normal stuff (Bitcoin, dollars, etc.) to meet those withdrawals, so what was left was the weirdo cats and dogs. Still it is striking that the balance sheet that FTX circulated to potential rescuers consisted mostly of stuff it made up. Its balance sheet consisted mostly of stuff it made up! Stuff it made up! You can’t do that! That’s not how balance sheets work! That’s not how anything works!Apparently that is how most crypto businesses seems to work...
posted by Wretch729 at 1:24 PM on November 14, 2022 [20 favorites]
The amount of actual currency being vacuumed up and redistributed by these schemes is absurd. FTX collected US$16 billion dollars of actual US dollars.from.customers. The annual budget for my province is less than C$ 100 billion and we run hospitals, schools, roads and healthcare plus other stuff for five million people.
posted by Mitheral at 1:31 PM on November 14, 2022 [39 favorites]
posted by Mitheral at 1:31 PM on November 14, 2022 [39 favorites]
OK, turns out the thread I was looking for wasn't too hard to find -- SSC is now "Astral Codex Ten", and the phrase I was missing was "effective altruism".
posted by The Pluto Gangsta at 1:33 PM on November 14, 2022 [4 favorites]
posted by The Pluto Gangsta at 1:33 PM on November 14, 2022 [4 favorites]
Bear Stearns had about $18 billion in assets when it went down. So this FTX collapse is only slightly smaller… but somehow happened without even the most basic of risk management or accountability.
These chucklefucks make Bear Stearns look good by comparison.
posted by notoriety public at 1:34 PM on November 14, 2022 [18 favorites]
These chucklefucks make Bear Stearns look good by comparison.
posted by notoriety public at 1:34 PM on November 14, 2022 [18 favorites]
we run hospitals, schools, roads and healthcare plus other stuff for five million people
Well sure, but blockchain. Nah, I can't explain it either.
posted by Abehammerb Lincoln at 1:35 PM on November 14, 2022 [4 favorites]
Well sure, but blockchain. Nah, I can't explain it either.
posted by Abehammerb Lincoln at 1:35 PM on November 14, 2022 [4 favorites]
When this all broke last week did anyone else think, "FTX who?!" . This crypto stuff is wild man.
posted by alex_skazat at 1:36 PM on November 14, 2022 [10 favorites]
posted by alex_skazat at 1:36 PM on November 14, 2022 [10 favorites]
Yikes, you know it must be bad when a former Goldman Sachs investment banker is calling you out.
posted by Abehammerb Lincoln at 1:36 PM on November 14, 2022 [6 favorites]
posted by Abehammerb Lincoln at 1:36 PM on November 14, 2022 [6 favorites]
And you just know that there will not be enough (if any) prison time for any of the fucking fraudsters involved.
I find it hard to generate sympathy for people dumb enough to get suckered by something this absurd, mostly because I assume they're mostly tech bros and VC types, but I imagine there are quite a few ordinary people who just lost everything.
posted by Ickster at 1:40 PM on November 14, 2022 [6 favorites]
I find it hard to generate sympathy for people dumb enough to get suckered by something this absurd, mostly because I assume they're mostly tech bros and VC types, but I imagine there are quite a few ordinary people who just lost everything.
posted by Ickster at 1:40 PM on November 14, 2022 [6 favorites]
Effective Altruism is essentially a cult. Which is what you might expect someone who likes names such as "Slate Star Codex" and "Astral Codex Ten" to be into.
posted by axiom at 1:40 PM on November 14, 2022 [14 favorites]
posted by axiom at 1:40 PM on November 14, 2022 [14 favorites]
Wonder how much of this is the NSA getting serious about stopping the flow of unregulated cash into Russia.Not the NSA, but the FBI and North Korea:
https://www.ft.com/content/dec696d4-fd51-4cce-bbd9-1dee911eb4cd
https://arstechnica.com/information-technology/2022/11/how-north-korea-became-a-mastermind-of-crypto-cyber-crime/
posted by adamsc at 1:41 PM on November 14, 2022 [7 favorites]
Someone in the Defector commentariat has pointed out that the entire cryptocurrency industry is that one episode of Beavis and Butthead where they sell each other a whole box of fund-raising chocolate with the same $1 bill.
posted by hwyengr at 1:48 PM on November 14, 2022 [68 favorites]
posted by hwyengr at 1:48 PM on November 14, 2022 [68 favorites]
the former "Slate Star Codex" writer (who I'm told is very much into "rational charity" or something like that)
Huh, I thought that was the guy who was always correct about stuff due to his rational brain, unlike us soft leftist types with our stupid feminist whining and unprovable assertions about feelings and experience, etc etc. Weird.
~~
Effective altruism only makes sense if you think it makes sense to, eg, work for Lockheed Martin designing land mines which cause one million dollars worth of suffering so that you can make two million dollars which you then use to eradicate two million dollars worth of suffering - sure you create new suffering but you have eradicated a higher dollar value of suffering, which makes the landmines good, actually!!!
If you're really smart, you can say that you're making millions of dollars on the landmines now so that you can avert the umpteen quadrillion dollars of suffering that will be caused in the far future by, eg, Rokko's Landmine Basilisk, which you are preventing from coming into being.
Then you can tell everyone that your rational brain has quantified the world and only squeamish, irrational, identity-poisoned leftists would want to, like, not design landmines when designing landmines buys two million dollars of malaria nets or whatever.
posted by Frowner at 1:49 PM on November 14, 2022 [38 favorites]
Huh, I thought that was the guy who was always correct about stuff due to his rational brain, unlike us soft leftist types with our stupid feminist whining and unprovable assertions about feelings and experience, etc etc. Weird.
~~
Effective altruism only makes sense if you think it makes sense to, eg, work for Lockheed Martin designing land mines which cause one million dollars worth of suffering so that you can make two million dollars which you then use to eradicate two million dollars worth of suffering - sure you create new suffering but you have eradicated a higher dollar value of suffering, which makes the landmines good, actually!!!
If you're really smart, you can say that you're making millions of dollars on the landmines now so that you can avert the umpteen quadrillion dollars of suffering that will be caused in the far future by, eg, Rokko's Landmine Basilisk, which you are preventing from coming into being.
Then you can tell everyone that your rational brain has quantified the world and only squeamish, irrational, identity-poisoned leftists would want to, like, not design landmines when designing landmines buys two million dollars of malaria nets or whatever.
posted by Frowner at 1:49 PM on November 14, 2022 [38 favorites]
Freddie de Boer is extraordinarily hit-or-miss, and is Too Online to boot, but this essay from a few months ago is a pretty lucid takedown of "effective altruism" as a whole: Effective Altruism Has a Novelty Problem
posted by Tom Hanks Cannot Be Trusted at 1:50 PM on November 14, 2022 [15 favorites]
Every single moral philosophy and religion in the history of the world has had a goal of doing good well. You cannot find a text that attempts to define the good that does not also explain the difference between doing the good well and doing it poorly. Buddhism has whole lines of inquiry devoted to the idea of people who follow Buddha’s teachings to the letter and still arrive at the wrong conclusions entirely. If you’re a Christian, you could argue that the New Testament is mostly a matter of God sending his son to Earth to explain to human beings how they were failing to live up to the rules in the Old Testament. “Do good well” is not a new idea and certainly not an interesting one, and I’m perpetually put out by how many EA enthusiasts seem to think that they’re playing a powerful Pokemon when they whip that definition out. [...](I do not endorse any other thing that Freddie's posted, up to and including the essay he'll inevitably write about how annoyed he is by this disclaimer.)
Interesting is not the same as important. So why are effective altruist spaces dominated by people trying to be interesting? Why do so many of its acolytes seem determined to distinguish themselves from each other, rather than to simply contribute a little bit to the overarching project of making the world a tiny bit better, without expectation of notoriety?
posted by Tom Hanks Cannot Be Trusted at 1:50 PM on November 14, 2022 [15 favorites]
Bonus points for that article, btw, is that the top comment is by Scott Alexander, getting miffed with Freddie in a way that retroactively is extremely fucking funny.
posted by Tom Hanks Cannot Be Trusted at 1:51 PM on November 14, 2022 [2 favorites]
posted by Tom Hanks Cannot Be Trusted at 1:51 PM on November 14, 2022 [2 favorites]
Awful lot of SBF memes now, like..
"She likes a rugging individualist" / Directed by Robert B. Weide
Also 20% of crypto,com reserves are in SHIB, and they've halted withdrawals, so.. bye bye.
posted by jeffburdges at 1:57 PM on November 14, 2022
"She likes a rugging individualist" / Directed by Robert B. Weide
Also 20% of crypto,com reserves are in SHIB, and they've halted withdrawals, so.. bye bye.
posted by jeffburdges at 1:57 PM on November 14, 2022
Caroline Ellison's blog is absolutely batshit, but I'm uncomfortable with the particular tone of hate she's getting. And we should maybe not get in the habit of linking to shit that Ian Miles Cheong does—he is a pretty execrable human being.
posted by Tom Hanks Cannot Be Trusted at 2:27 PM on November 14, 2022 [16 favorites]
posted by Tom Hanks Cannot Be Trusted at 2:27 PM on November 14, 2022 [16 favorites]
This passage is just wild. This is how high crypto has gotten on its own supply. My goodness.
Relevant, from 6 months ago: Crypto CEO Accidentally Describes Ponzi Scheme
It's Bankman-Fried telling Matt Levine (author of the OP article) how he creates money from nothing. Levine's summary of what Bankman-Fried is telling him: "You're just, like, 'Well, I'm in the Ponzi business, and it's pretty good!'"
posted by clawsoon at 2:32 PM on November 14, 2022 [16 favorites]
Relevant, from 6 months ago: Crypto CEO Accidentally Describes Ponzi Scheme
It's Bankman-Fried telling Matt Levine (author of the OP article) how he creates money from nothing. Levine's summary of what Bankman-Fried is telling him: "You're just, like, 'Well, I'm in the Ponzi business, and it's pretty good!'"
posted by clawsoon at 2:32 PM on November 14, 2022 [16 favorites]
This feels like a whole lot of threads I've been keeping an eye on for a while tying together nicely. They were already connected if you were watching; but it's another thing to see it happen so visibly.
Watch. Soon we'll start seeing the screenshots where various parties involved were *really* into "Human Biodiversity" (read: the most recent/still-palatable-to-them rebranding of 'scientific racism', itself a repackaging of 'but what if Europeans really *are* genetically superior'), publicly, but they got too comfortable & didn't think it would get beyond their circles.
And the "ok, so we took amphetamines long enough that all this started sounding like a good idea, so what's the downside to modeling ourselves after Mage: the Ascension orders?" hubris kicks in.
And then the sex-cult/human-trafficking stuff will get another spotlight on it.
I'm not sure where it goes from there, but hopefully this time more of it will stick, vs. being overridden by the next topic while they lick their wounds & write grandiose articles about how important it is to "hide your power level" while seeking political influence via Anduril & Palantir; Palmer Luckey & Peter Thiel.
posted by CrystalDave at 2:32 PM on November 14, 2022 [13 favorites]
Watch. Soon we'll start seeing the screenshots where various parties involved were *really* into "Human Biodiversity" (read: the most recent/still-palatable-to-them rebranding of 'scientific racism', itself a repackaging of 'but what if Europeans really *are* genetically superior'), publicly, but they got too comfortable & didn't think it would get beyond their circles.
And the "ok, so we took amphetamines long enough that all this started sounding like a good idea, so what's the downside to modeling ourselves after Mage: the Ascension orders?" hubris kicks in.
And then the sex-cult/human-trafficking stuff will get another spotlight on it.
I'm not sure where it goes from there, but hopefully this time more of it will stick, vs. being overridden by the next topic while they lick their wounds & write grandiose articles about how important it is to "hide your power level" while seeking political influence via Anduril & Palantir; Palmer Luckey & Peter Thiel.
posted by CrystalDave at 2:32 PM on November 14, 2022 [13 favorites]
now he's talking about creating some sort of trustworthiness index wherein he'll publicly cut ties with anyone who scores below a certain percentage
FWIW, I took that to be a joke. But I often find it hard to tell when Scott is joking and when he's being serious.
posted by verstegan at 2:35 PM on November 14, 2022 [2 favorites]
FWIW, I took that to be a joke. But I often find it hard to tell when Scott is joking and when he's being serious.
posted by verstegan at 2:35 PM on November 14, 2022 [2 favorites]
Kidding on the square is a cornerstone of that guy's style.
posted by straight at 2:46 PM on November 14, 2022 [5 favorites]
posted by straight at 2:46 PM on November 14, 2022 [5 favorites]
I get the feeling that crypto people heard the thing they always say about fiat money being created from nothing and decided that if money could be created from nothing they might as well do that themselves and the result would be just as good as fiat.
It's like believing you can create a political system from scratch based on an editorial cartoon you saw in the Sun.
posted by clawsoon at 2:47 PM on November 14, 2022 [11 favorites]
It's like believing you can create a political system from scratch based on an editorial cartoon you saw in the Sun.
posted by clawsoon at 2:47 PM on November 14, 2022 [11 favorites]
Frank X. Shaw ✅, head of communications for Microsoft tweets:
I can't believe I have to say this, but Clippy never carries a knife.posted by straight at 2:50 PM on November 14, 2022 [47 favorites]
Oh. Your. God. They took customer money, blew it, and replaced it with altcoin pre-mine. And people only noticed after Bitcoin crashed.
posted by krisjohn at 2:53 PM on November 14, 2022 [5 favorites]
posted by krisjohn at 2:53 PM on November 14, 2022 [5 favorites]
I actually quite liked the idea of effective altruism, and was willing to discount the crazier parts of it as influence from rationalists, who to my mind had already gone past the threshold of what de Boer aptly summarises as "if the rule you followed brought you to this, of what use was the rule?" which is a principle I've also found extremely valuable over the years. But, uh, it's not looking good for effective altruism, is it?
I mean, I was never convinced by the idea that it's most effective to go to work for Lockheed Martin or a bank, makes lots of money, and then donate that money. It seemed to be resting on an over-confidence in your valuation of the relative harm caused by your job and the good done by the donation, and I think an accounting loophole where you pretend that there's a certain dollar value that can undo someone dying. Now I'm also thinking about whether malaria protection is actually the most efficient use of money, or whether it's also resting on an intangible that someone just made up a dollar value for.
posted by Merus at 2:58 PM on November 14, 2022 [3 favorites]
I mean, I was never convinced by the idea that it's most effective to go to work for Lockheed Martin or a bank, makes lots of money, and then donate that money. It seemed to be resting on an over-confidence in your valuation of the relative harm caused by your job and the good done by the donation, and I think an accounting loophole where you pretend that there's a certain dollar value that can undo someone dying. Now I'm also thinking about whether malaria protection is actually the most efficient use of money, or whether it's also resting on an intangible that someone just made up a dollar value for.
posted by Merus at 2:58 PM on November 14, 2022 [3 favorites]
I (and others) have half-joked on Twitter that he should just bid the banks 50 cents on the dollar to buy up all the debt. Sure that is throwing good money after bad, but (1) it would save Twitter a lot of interest expense, (2) it would ensure that Musk can own Twitter forever if for some reason he wants that, (3) it’s not throwing away that much more money, compared to what he has already spent and (4) it would be a good troll
Please.....just don't joke like that. It's not funny.
I appreciate how thorough Matt Levine is in pointing out just how much of an omnifail FTX is and how shambolic it's attempts to be bailed out were, but comments like that remind me that Levine isn't necessarily mocking FTX because it was stupid idea, but rather because the people behind it weren't smart enough to pull it off.
posted by RonButNotStupid at 3:06 PM on November 14, 2022 [8 favorites]
Please.....just don't joke like that. It's not funny.
I appreciate how thorough Matt Levine is in pointing out just how much of an omnifail FTX is and how shambolic it's attempts to be bailed out were, but comments like that remind me that Levine isn't necessarily mocking FTX because it was stupid idea, but rather because the people behind it weren't smart enough to pull it off.
posted by RonButNotStupid at 3:06 PM on November 14, 2022 [8 favorites]
Crypto is a lot like Donald Trump. Every few months from the start of it I’m like surely this; yet it never is. It would be pretty funny if they both come crashing down this month.
posted by interogative mood at 3:25 PM on November 14, 2022 [9 favorites]
posted by interogative mood at 3:25 PM on November 14, 2022 [9 favorites]
FTX was the company that ran the Larry David commercial during the super bowl, if you need a touchstone that a lot of people will recognize.
posted by RobotHero at 3:28 PM on November 14, 2022 [7 favorites]
posted by RobotHero at 3:28 PM on November 14, 2022 [7 favorites]
It's Bankman-Fried telling Matt Levine (author of the OP article) how he creates money from nothing.
Admittedly the most investment I have in crypto is time spent listening to podcasts, but when I was listening to that Odd Lots show six months ago, my take was that Sam was describing how all the other peopledefraud you run DeFi / yield farming setups. At the time I don't think anyone knew that FTX was a problem -- they are a crypto exchange, not a yield farm. When you buy the FTT coin, the expectation was that you would be getting a percentage of the profits -- a few basis point from every transaction on the FTX platform, paid out to you in the form of buybacks:
Levine isn't necessarily mocking FTX because it was stupid idea, but rather because the people behind it weren't smart enough to pull it off.
Or weren't even trying. But really, the first step in accusing your competitors of running a Ponzi scheme is to not be running a Ponzi scheme!
posted by pwnguin at 3:34 PM on November 14, 2022 [2 favorites]
Admittedly the most investment I have in crypto is time spent listening to podcasts, but when I was listening to that Odd Lots show six months ago, my take was that Sam was describing how all the other people
One third of all fees generated on FTX will be used for an FTT repurchase, until at least half of all FTT is burned. Any FTT bought this way will be burned.
Levine isn't necessarily mocking FTX because it was stupid idea, but rather because the people behind it weren't smart enough to pull it off.
Or weren't even trying. But really, the first step in accusing your competitors of running a Ponzi scheme is to not be running a Ponzi scheme!
posted by pwnguin at 3:34 PM on November 14, 2022 [2 favorites]
Merus: Now I'm also thinking about whether malaria protection is actually the most efficient use of money, or whether it's also resting on an intangible that someone just made up a dollar value for.
Malaria nets that save children may or may not be worth it, but surely we can all agree that donating all your money to AI think-tanks so that we'll know what to do about future superintelligent AI is the best possible (and most rational) thing you can do with your charity dollars.
posted by clawsoon at 3:38 PM on November 14, 2022 [12 favorites]
Malaria nets that save children may or may not be worth it, but surely we can all agree that donating all your money to AI think-tanks so that we'll know what to do about future superintelligent AI is the best possible (and most rational) thing you can do with your charity dollars.
posted by clawsoon at 3:38 PM on November 14, 2022 [12 favorites]
One group losing money on FTX is the Ontario Teachers' Federation, which had $95M in crypto. The Quebec Teachers had something similar happen in July and lost $150M when Celsius bankrupted.
(Some of the articles in Canadian news ended by saying, "too early", but "still a worthwhile investment". Here's one.)
posted by CCBC at 3:39 PM on November 14, 2022 [2 favorites]
(Some of the articles in Canadian news ended by saying, "too early", but "still a worthwhile investment". Here's one.)
posted by CCBC at 3:39 PM on November 14, 2022 [2 favorites]
One group losing money on FTX is the Ontario Teachers' Federation
Ontario Teachers' Federation is one of the teachers' unions in Ontario. The Ontario Teachers' Pension Plan (OTPP) (previously, re: Celsius and FTX) is a different entity entirely.
Caisse de dépôt et placement du Québec (CDPQ) isn't strictly a pension fund for teachers, it's a pension fund for public sector and broader public sector employees that includes teachers among its members.
The FTX and Celsius investments (as a percentage of assets under management by both pension funds) were relatively inconsequential, but still stand as a stupid-as-fuck thing for a pension fund to have been messing around in at all, because these were blatantly obvious frauds from the get-go.
posted by mandolin conspiracy at 4:00 PM on November 14, 2022 [12 favorites]
Ontario Teachers' Federation is one of the teachers' unions in Ontario. The Ontario Teachers' Pension Plan (OTPP) (previously, re: Celsius and FTX) is a different entity entirely.
Caisse de dépôt et placement du Québec (CDPQ) isn't strictly a pension fund for teachers, it's a pension fund for public sector and broader public sector employees that includes teachers among its members.
The FTX and Celsius investments (as a percentage of assets under management by both pension funds) were relatively inconsequential, but still stand as a stupid-as-fuck thing for a pension fund to have been messing around in at all, because these were blatantly obvious frauds from the get-go.
posted by mandolin conspiracy at 4:00 PM on November 14, 2022 [12 favorites]
All your coinbase are belong to us.
posted by thecincinnatikid at 4:02 PM on November 14, 2022 [12 favorites]
posted by thecincinnatikid at 4:02 PM on November 14, 2022 [12 favorites]
All your coinbase are belong to us.
You have no chance to survive make your dime.
Take off every vig! Move vig for great justice!!!
posted by loquacious at 4:15 PM on November 14, 2022 [36 favorites]
You have no chance to survive make your dime.
Take off every vig! Move vig for great justice!!!
posted by loquacious at 4:15 PM on November 14, 2022 [36 favorites]
Now I’ve been told that SBF funded the initiative for approval voting that Washington state just voted on. Can’t find good verification.
posted by clew at 4:19 PM on November 14, 2022
posted by clew at 4:19 PM on November 14, 2022
Effective Altruism isn't about making $1M selling landmines and buying $2M worth of bed nets.
It's about taking ~$9B dollars from cryptobros and giving $40M to Democrats.
posted by kaibutsu at 4:21 PM on November 14, 2022 [15 favorites]
It's about taking ~$9B dollars from cryptobros and giving $40M to Democrats.
posted by kaibutsu at 4:21 PM on November 14, 2022 [15 favorites]
Now I’ve been told that SBF funded the initiative for approval voting that Washington state just voted on.posted by Cogito at 4:22 PM on November 14, 2022 [3 favorites]Fortunately it was pitted against ranked choice voting, and RCV won by a landslide
FTX was the company that ran the Larry David commercial during the super bowl, if you need a touchstone that a lot of people will recognize.
Literally the only thing I knew about them before this week.
posted by octothorpe at 4:36 PM on November 14, 2022
Literally the only thing I knew about them before this week.
posted by octothorpe at 4:36 PM on November 14, 2022
Question: based on this tweet, does this tiresome fraud now identify as a "crypto bottom?"
He's used to being the top in a fraud, though, so it's gonna be a bit of a shift in mindset.
You can do it, Kevin. Live your best life.
posted by mandolin conspiracy at 4:49 PM on November 14, 2022
He's used to being the top in a fraud, though, so it's gonna be a bit of a shift in mindset.
You can do it, Kevin. Live your best life.
posted by mandolin conspiracy at 4:49 PM on November 14, 2022
So I don't really know a lot about banking, and even less about crypto. But I'm thinking I wouldn't be too far off the mark if I just assume these guys are sovereign citizen types, except with finance. Is that sort of in the ballpark?
posted by Naberius at 5:24 PM on November 14, 2022 [2 favorites]
posted by Naberius at 5:24 PM on November 14, 2022 [2 favorites]
what happened to viable fiats like gold, diamonds and cocaine.
posted by clavdivs at 5:30 PM on November 14, 2022 [3 favorites]
posted by clavdivs at 5:30 PM on November 14, 2022 [3 favorites]
How is it possible that we haven’t heard of a Keith Raniere - crypto connection yet?
posted by Don.Kinsayder at 5:45 PM on November 14, 2022 [4 favorites]
posted by Don.Kinsayder at 5:45 PM on November 14, 2022 [4 favorites]
Interesting is not the same as important.
Thank you for attending my TED talk.
posted by Slothrup at 6:24 PM on November 14, 2022 [3 favorites]
Thank you for attending my TED talk.
posted by Slothrup at 6:24 PM on November 14, 2022 [3 favorites]
This article is one of the only ones that even begins to ask the big question - where the hell did all the money go?
I know this is crypto and it is hard to gauge exactly how much real money was actually invested by real people over the years since the market cap is meaningless but it had to be a lot. Like a lot a lot.
The exchanges weren't keeping it, they didn't seem to even buy the bitcoin they were supposed to. And, as this article points out, minting their own coins was free. So what happened to the money? Do the owners of these exchanges have huge dragon hoards stashed away somewhere? Did it all disappear into Russian organized crime or North Korea? Do the exchanges have a web of shadow investors that got paid dividends? Or did the exchanges end up paying protection money to keep the scam going longer? That is what I want to know.
The average investor didn't lose their money last week with FTX collapsed. The money was gone the second they transferred it to FTX years ago in return for not-even-magic-beans. That money is somewhere, but where?
We probably won't find out for years but somebody has gotten very, very rich off all this nonsense.
posted by AndrewStephens at 6:34 PM on November 14, 2022 [13 favorites]
I know this is crypto and it is hard to gauge exactly how much real money was actually invested by real people over the years since the market cap is meaningless but it had to be a lot. Like a lot a lot.
The exchanges weren't keeping it, they didn't seem to even buy the bitcoin they were supposed to. And, as this article points out, minting their own coins was free. So what happened to the money? Do the owners of these exchanges have huge dragon hoards stashed away somewhere? Did it all disappear into Russian organized crime or North Korea? Do the exchanges have a web of shadow investors that got paid dividends? Or did the exchanges end up paying protection money to keep the scam going longer? That is what I want to know.
The average investor didn't lose their money last week with FTX collapsed. The money was gone the second they transferred it to FTX years ago in return for not-even-magic-beans. That money is somewhere, but where?
We probably won't find out for years but somebody has gotten very, very rich off all this nonsense.
posted by AndrewStephens at 6:34 PM on November 14, 2022 [13 favorites]
Also, reading that thread by Astral Codex Ten that The Pluto Gangster posted is hilarious. Those poor people in the Bahamas, the real victims in all this.
Looks like my days of not taking Scott Alexander seriously are coming to a middle.
posted by AndrewStephens at 6:38 PM on November 14, 2022 [3 favorites]
Looks like my days of not taking Scott Alexander seriously are coming to a middle.
posted by AndrewStephens at 6:38 PM on November 14, 2022 [3 favorites]
We probably won't find outFixed that for you..for yearsbut somebody has gotten very, very rich off all this nonsense.
posted by Nerd of the North at 6:43 PM on November 14, 2022 [1 favorite]
I assume a good portion of those funds made their way to Russia, where they are being used to buy lemon tanks to drive into Ukraine to get wrecked by a $100 drone
Malaria nets that save children may or may not be worth it, but surely we can all agree that donating all your money to AI think-tanks so that we'll know what to do about future superintelligent AI is the best possible (and most rational) thing you can do with your charity dollars.
Ha ha I am immune to Roko's Basilisk, as is anyone who hears the argument about a super-intelligent super-computer solving all the world's problems and thinks "well obviously that won't work"
posted by Merus at 7:28 PM on November 14, 2022 [1 favorite]
Malaria nets that save children may or may not be worth it, but surely we can all agree that donating all your money to AI think-tanks so that we'll know what to do about future superintelligent AI is the best possible (and most rational) thing you can do with your charity dollars.
Ha ha I am immune to Roko's Basilisk, as is anyone who hears the argument about a super-intelligent super-computer solving all the world's problems and thinks "well obviously that won't work"
posted by Merus at 7:28 PM on November 14, 2022 [1 favorite]
Oh my god. SBF's nonsensical tweets today were timed to avoid automated systems detecting tweet deletions by keeping his tweet count neutral.
posted by Silvery Fish at 7:43 PM on November 14, 2022 [4 favorites]
posted by Silvery Fish at 7:43 PM on November 14, 2022 [4 favorites]
This is the best idea since Ferris tried to reverse the miles off of Cameron’s dad’s car.
posted by notoriety public at 8:09 PM on November 14, 2022 [11 favorites]
posted by notoriety public at 8:09 PM on November 14, 2022 [11 favorites]
Surely I'm not the only one noticing the person seemingly in the middle of all this has a name that looks a lot like 'Bankman Fraud'? Is that his real name, or some kind of joke?
Try as I might, I still can't get my head around how crypto actually works. It looks like a stacked series of ponzi schemes all the way down as far as I can figure out. In this case, someone in the scheme has clearly walked away with sixteen billion dollars.
posted by dg at 8:22 PM on November 14, 2022
Try as I might, I still can't get my head around how crypto actually works. It looks like a stacked series of ponzi schemes all the way down as far as I can figure out. In this case, someone in the scheme has clearly walked away with sixteen billion dollars.
posted by dg at 8:22 PM on November 14, 2022
the person seemingly in the middle of all this has a name that looks a lot like 'Bankman Fraud'There I was thinking he got his goose cooked, but it's more likely his Bankman Fried.
posted by pulposus at 8:51 PM on November 14, 2022 [4 favorites]
So if for instance some company creates a token, and says that there can be 10 billion of the token, and reserves them all for itself, and then sells 1 million of them to outside investors for $1 each, then the market cap of that token is $1 million ($1 times 1 million circulating tokens), while the fully diluted market cap is $10 billion ($1 times 10 billion total tokens), and the issuer’s 9,999,000,000 remaining tokens have a value, on this math, of $9.999 billion.Ok so is this a real thing? I know we're making fun of the insane balance sheet, but just to be clear since finance stuff is mumbo-jumbo to me anyway.
It seems to me the market cap would not be 10 billion. It would still be 1 million because that's how much actual money is in the system. That would make the true value after all the reserved tokens were counted worth $0.0001 each ($1 million/10 billion tokens)?
Just trying to match this with common sense.
posted by ctmf at 9:35 PM on November 14, 2022 [2 favorites]
This is absolutely a real thing. This is how coinmarketcap used to calculate the value of a coin. It was dumb and I remember Ripple having an insane market cap because they'd pre-mined so much (as a core part of the design).
This is the worst kind of pump-and-dump crap, at best. It's pure fraud, more often than not.
posted by krisjohn at 9:41 PM on November 14, 2022 [5 favorites]
This is the worst kind of pump-and-dump crap, at best. It's pure fraud, more often than not.
posted by krisjohn at 9:41 PM on November 14, 2022 [5 favorites]
Back at the height of the "Bitcoin is worth billions!" craze people were explaining it's like the owner of an apple orchard somehow selling a few apples for $100 each and then using this to claim his orchard is worth a million dollars.
posted by straight at 9:43 PM on November 14, 2022 [6 favorites]
posted by straight at 9:43 PM on November 14, 2022 [6 favorites]
Back in 2017 I had a coworker who was into bitcoin. I asked him what it was all about one time and once he had explained, I was like “so it’s kind of like Beanie Babies?” He was not amused by this.
posted by showbiz_liz at 9:50 PM on November 14, 2022 [10 favorites]
posted by showbiz_liz at 9:50 PM on November 14, 2022 [10 favorites]
But then this is not much different than the stock market. Elon can sell some of his shares for $190, but he can't sell 150 million of them for that price, so in what sense are they actually worth $28.5 billion?
posted by straight at 9:50 PM on November 14, 2022 [4 favorites]
posted by straight at 9:50 PM on November 14, 2022 [4 favorites]
But then this is not much different than the stock market. Elon can sell some of his shares for $190, but he can't sell 150 million of them for that price, so in what sense are they actually worth $28.5 billion?
Yeah, pull on that thread and follow it until the whole sweater unravels.
Something emperor something something new clothes something late stage capitalism.
posted by loquacious at 10:11 PM on November 14, 2022 [9 favorites]
Yeah, pull on that thread and follow it until the whole sweater unravels.
Something emperor something something new clothes something late stage capitalism.
posted by loquacious at 10:11 PM on November 14, 2022 [9 favorites]
I wonder if "You know better." as a slogan would just crash and burn.
posted by porpoise at 10:21 PM on November 14, 2022
posted by porpoise at 10:21 PM on November 14, 2022
FTX was the company that ran the Larry David commercial during the super bowl, if you need a touchstone that a lot of people will recognize.
*more blank stares*
posted by alex_skazat at 10:34 PM on November 14, 2022 [6 favorites]
*more blank stares*
posted by alex_skazat at 10:34 PM on November 14, 2022 [6 favorites]
That money is somewhere, but where?
It went from FTX to Alameda, Bankman-Fried's trading outfit, so presumably lost it all in bad trades (though I guess we can't discount the possibility that someone exfiltrated it to a personal account from there). So it's probably less an individual, and mute it being spread around a bunch of other traders.
Of course, some portion of it went to paying large salaries to people like Bankman-Fried and Ellison.
posted by Dysk at 11:35 PM on November 14, 2022
It went from FTX to Alameda, Bankman-Fried's trading outfit, so presumably lost it all in bad trades (though I guess we can't discount the possibility that someone exfiltrated it to a personal account from there). So it's probably less an individual, and mute it being spread around a bunch of other traders.
Of course, some portion of it went to paying large salaries to people like Bankman-Fried and Ellison.
posted by Dysk at 11:35 PM on November 14, 2022
straight: But then this is not much different than the stock market. Elon can sell some of his shares for $190, but he can't sell 150 million of them for that price, so in what sense are they actually worth $28.5 billion?
I like to think that some rough Marxist analysis is useful here: If a company is extracting surplus value from the labour of workers, you've got yourself a profitable company whose shares are worth something.
There are more sophisticated ways to calculate exactly how much a company is worth. Most of them involve predicting the future of the company and comparing it to your predictions about future interest rates, and then dividing by your predictions about the future number of total shares.
As long as you're good at predicting the future it's easy.
posted by clawsoon at 3:52 AM on November 15, 2022 [5 favorites]
I like to think that some rough Marxist analysis is useful here: If a company is extracting surplus value from the labour of workers, you've got yourself a profitable company whose shares are worth something.
There are more sophisticated ways to calculate exactly how much a company is worth. Most of them involve predicting the future of the company and comparing it to your predictions about future interest rates, and then dividing by your predictions about the future number of total shares.
As long as you're good at predicting the future it's easy.
posted by clawsoon at 3:52 AM on November 15, 2022 [5 favorites]
It seems to me the market cap would not be 10 billion. It would still be 1 million because that's how much actual money is in the system.
I remember reading in one of those “jokes & pranks for kids” books, decades ago now, that you could make yourself a millionaire by issuing a million shares of stock in yourself and having a friend buy one share for a dollar. This is literally that.
posted by gauche at 5:13 AM on November 15, 2022 [14 favorites]
I remember reading in one of those “jokes & pranks for kids” books, decades ago now, that you could make yourself a millionaire by issuing a million shares of stock in yourself and having a friend buy one share for a dollar. This is literally that.
posted by gauche at 5:13 AM on November 15, 2022 [14 favorites]
The financial history speedrun appears to have reached 1907.
posted by clawsoon at 5:45 AM on November 15, 2022 [3 favorites]
posted by clawsoon at 5:45 AM on November 15, 2022 [3 favorites]
I'm not sure if the "finance history speedrun" tweet I linked to just got deleted or if it's just Elon chewing on wires, but here's the text if it doesn't come back:
"@cz_binance: To reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis. More details to come soon. In the meantime, please contact Binance Labs if you think you qualify."
posted by clawsoon at 5:51 AM on November 15, 2022 [1 favorite]
"@cz_binance: To reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis. More details to come soon. In the meantime, please contact Binance Labs if you think you qualify."
posted by clawsoon at 5:51 AM on November 15, 2022 [1 favorite]
It’s not known what state Binance’s sheets are, they might be just as threadbare. But they don’t have to show them to anybody, do they? But this is a great chance for Binance to get all the various small fry to show Binance their dirty laundry. I imagine that is an extremely lucrative opportunity for Binance. Extract maximum value from the market, either to consolidate their position further (if they are actually solvent), or bust out the whole ecosystem in one last hurrah (if they’re a hollowed out shell like all the others).
People saying Binance wouldn’t blow up the market because “why would they kill the golden goose?” Those people are discounting the very real possibility that the goose is already cooked and eaten, and all that’s left is to pick over the carcass.
I’m sure we will find out which side of the fence we are on, soon enough.
posted by notoriety public at 6:25 AM on November 15, 2022 [3 favorites]
People saying Binance wouldn’t blow up the market because “why would they kill the golden goose?” Those people are discounting the very real possibility that the goose is already cooked and eaten, and all that’s left is to pick over the carcass.
I’m sure we will find out which side of the fence we are on, soon enough.
posted by notoriety public at 6:25 AM on November 15, 2022 [3 favorites]
How is it possible that we haven’t heard of a Keith Raniere - crypto connection yet?
Raniere was into the Classic Ponzi schemes (and sex cults). I think by the time crypto came around, he had already been in a tailspin. Not that that's stopped anybody before.
posted by mikelieman at 6:36 AM on November 15, 2022
Raniere was into the Classic Ponzi schemes (and sex cults). I think by the time crypto came around, he had already been in a tailspin. Not that that's stopped anybody before.
posted by mikelieman at 6:36 AM on November 15, 2022
straight (quoting this tweet): I can't believe I have to say this, but Clippy never carries a knife.
Speak softly and carry big grammar corrections.
posted by k3ninho at 6:45 AM on November 15, 2022 [1 favorite]
Speak softly and carry big grammar corrections.
posted by k3ninho at 6:45 AM on November 15, 2022 [1 favorite]
Effective Altruism isn't about making $1M selling landmines and buying $2M worth of bed nets.
Effective Altruism is the broken window fallacy but the math is More Wrong.
posted by AlSweigart at 6:52 AM on November 15, 2022 [5 favorites]
Effective Altruism is the broken window fallacy but the math is More Wrong.
posted by AlSweigart at 6:52 AM on November 15, 2022 [5 favorites]
the person seemingly in the middle of all this has a name that looks a lot like 'Bankman Fraud'
There I was thinking he got his goose cooked, but it's more likely his Bankman Fried.
His parents are Barbara Fried and Joe Bankman, both Stanford law professors who by all accounts are well-liked by students and colleagues. But his dad "helped launch his son's career by putting him in touch with private equity investor Orlando Bravo," which probably wasn't a great idea in retrospect.
posted by Emera Gratia at 7:40 AM on November 15, 2022 [2 favorites]
There I was thinking he got his goose cooked, but it's more likely his Bankman Fried.
His parents are Barbara Fried and Joe Bankman, both Stanford law professors who by all accounts are well-liked by students and colleagues. But his dad "helped launch his son's career by putting him in touch with private equity investor Orlando Bravo," which probably wasn't a great idea in retrospect.
posted by Emera Gratia at 7:40 AM on November 15, 2022 [2 favorites]
Yeah this says volumes about elite academia and the connections it helps foster for certain types of people.
posted by MisantropicPainforest at 7:44 AM on November 15, 2022 [8 favorites]
posted by MisantropicPainforest at 7:44 AM on November 15, 2022 [8 favorites]
But then this is not much different than the stock market. Elon can sell some of his shares for $190, but he can't sell 150 million of them for that price, so in what sense are they actually worth $28.5 billion?
Well, yeah, that's basically the question of liquidity. Crucially, someone could sell many billions of dollars worth of shares in Tesla and get a pretty high % of that price. So the collective fiction (and all market participants know that it is) is close enough to reality that it works. Note that people who actually need to be able to transfer large amounts of share to cash do think about this and would apply liquidity discounts to a really big position in something illiquid. I.e. if I tried to secure a loan with thinly traded shares, it would take more $ worth of shares than if I tried to secure a loan with IBM shares. Precisely because the lenders know that if they had to sell my position to cover, they can dump the IBM shares onto the market at the market price and get it whereas my proportionately larger position in a small company might have to be sold over the course of weeks.
Also, although this is as often honoured in the breach as in the observance, there is at least a theoretical cashflow model underlying that value. In Tesla's case it has some pretty implausible assumptions built in, but they do build actual cars and sell them for actual profits so if you assume enough growth the stock really does have that value. If you assume a lot less growth it still has value just less.
This stuff has so few buyers relative to its theoretical float as to be in a totally different world.
posted by atrazine at 7:46 AM on November 15, 2022 [4 favorites]
Well, yeah, that's basically the question of liquidity. Crucially, someone could sell many billions of dollars worth of shares in Tesla and get a pretty high % of that price. So the collective fiction (and all market participants know that it is) is close enough to reality that it works. Note that people who actually need to be able to transfer large amounts of share to cash do think about this and would apply liquidity discounts to a really big position in something illiquid. I.e. if I tried to secure a loan with thinly traded shares, it would take more $ worth of shares than if I tried to secure a loan with IBM shares. Precisely because the lenders know that if they had to sell my position to cover, they can dump the IBM shares onto the market at the market price and get it whereas my proportionately larger position in a small company might have to be sold over the course of weeks.
Also, although this is as often honoured in the breach as in the observance, there is at least a theoretical cashflow model underlying that value. In Tesla's case it has some pretty implausible assumptions built in, but they do build actual cars and sell them for actual profits so if you assume enough growth the stock really does have that value. If you assume a lot less growth it still has value just less.
This stuff has so few buyers relative to its theoretical float as to be in a totally different world.
posted by atrazine at 7:46 AM on November 15, 2022 [4 favorites]
>> That money is somewhere, but where?
> It went from FTX to Alameda, Bankman-Fried's trading outfit, so presumably lost it all in bad trades (though I guess we can't discount the possibility that someone exfiltrated it to a personal account from there).
That just raises further questions - who was on the other end of those trades? Was it fair dealing and there are thousands of regular crypto speculators who made bank with smart plays? Or was it mainly other sketchy exchanges all dealing with each other and the trades were just a way to move money from one entity to another controlled by the same pool of people?
The crypto world is so entangled with companies loaning and trading with each other in a huge Gordian knot of stupidity. Most of it was in crypto but none of it matters except the actual money, which should be easy enough to trace.
One thing that might come out of this that I have always wanted to know is how much actual money was put in by investors. The figures bandied about are all "market cap", which is meaningless for crypto. How much money (US dollars, Yen, etc) was actually deposited on the exchange by users? And where did the money go once it was sent off to cover Alameda's trades?
posted by AndrewStephens at 7:47 AM on November 15, 2022 [6 favorites]
> It went from FTX to Alameda, Bankman-Fried's trading outfit, so presumably lost it all in bad trades (though I guess we can't discount the possibility that someone exfiltrated it to a personal account from there).
That just raises further questions - who was on the other end of those trades? Was it fair dealing and there are thousands of regular crypto speculators who made bank with smart plays? Or was it mainly other sketchy exchanges all dealing with each other and the trades were just a way to move money from one entity to another controlled by the same pool of people?
The crypto world is so entangled with companies loaning and trading with each other in a huge Gordian knot of stupidity. Most of it was in crypto but none of it matters except the actual money, which should be easy enough to trace.
One thing that might come out of this that I have always wanted to know is how much actual money was put in by investors. The figures bandied about are all "market cap", which is meaningless for crypto. How much money (US dollars, Yen, etc) was actually deposited on the exchange by users? And where did the money go once it was sent off to cover Alameda's trades?
posted by AndrewStephens at 7:47 AM on November 15, 2022 [6 favorites]
But then this is not much different than the stock market. Elon can sell some of his shares for $190, but he can't sell 150 million of them for that price, so in what sense are they actually worth $28.5 billion?
Tesla has an average transaction volume of 73 millions shares/day. Musk owns about 150 millions shares if I'm not mistaken. This seems not entirely illiquid, but Elon could not put such a big quantity on the market without affecting the price, and there's the added factor that coming from Elon it sends a message. Also, even though stocks markets are not entirely logical, this is not crypto-grift, and there are rules and regulations about doing those kind of things.
I seem to remember Gates, selling his MS shares over years, as a steady constant "trickle" so that nobody could read anything into "Gates is selling MS".
posted by WaterAndPixels at 8:02 AM on November 15, 2022
Tesla has an average transaction volume of 73 millions shares/day. Musk owns about 150 millions shares if I'm not mistaken. This seems not entirely illiquid, but Elon could not put such a big quantity on the market without affecting the price, and there's the added factor that coming from Elon it sends a message. Also, even though stocks markets are not entirely logical, this is not crypto-grift, and there are rules and regulations about doing those kind of things.
I seem to remember Gates, selling his MS shares over years, as a steady constant "trickle" so that nobody could read anything into "Gates is selling MS".
posted by WaterAndPixels at 8:02 AM on November 15, 2022
WSJ article posted this morning: FTX Founder Sam Bankman-Fried Attempts to Raise Fresh Cash Despite Bankruptcy . (link leads to archive version).
The person seems absolutely ungrounded.
posted by Silvery Fish at 8:13 AM on November 15, 2022 [4 favorites]
The person seems absolutely ungrounded.
posted by Silvery Fish at 8:13 AM on November 15, 2022 [4 favorites]
> There I was thinking he got his goose cooked, but it's more likely his Bankman Fried.My first mental image to this was of those videos where you see someone drop a completely frozen Thanksgiving turkey into a frying-hot vat of oil, and the resulting Vesuvius afterward... and I'm sticking with that.
posted by Fiberoptic Zebroid and The Hypnagogic Jerks at 8:13 AM on November 15, 2022
I work in banking, and Levine’s newsletter is always the bright spot of my morning - I make a fresh cup of tea and take time out to read it. I’ve been laughing at this on and off since yesterday: “It’s an Excel file full of the howling of ghosts and the shrieking of tortured souls. If you look too long at that spreadsheet, you will go insane.”
posted by skycrashesdown at 8:19 AM on November 15, 2022 [8 favorites]
posted by skycrashesdown at 8:19 AM on November 15, 2022 [8 favorites]
dg: I still can't get my head around how crypto actually works. It looks like a stacked series of ponzi schemes...
See, here's where you're wrong, dg: it's not a pyramid, it's a fractal of fraud. At every scale, every portion of it is bullshit and hustle and lies.
And I don't say this as a snide joke, I say it because it makes me damn angry when someone uses an information inequality to steal from other people. So, so cynical. GRRR.
posted by wenestvedt at 8:39 AM on November 15, 2022 [8 favorites]
See, here's where you're wrong, dg: it's not a pyramid, it's a fractal of fraud. At every scale, every portion of it is bullshit and hustle and lies.
And I don't say this as a snide joke, I say it because it makes me damn angry when someone uses an information inequality to steal from other people. So, so cynical. GRRR.
posted by wenestvedt at 8:39 AM on November 15, 2022 [8 favorites]
People saying Binance wouldn’t blow up the market because “why would they kill the golden goose?” Those people are discounting the very real possibility that the goose is already cooked and eaten, and all that’s left is to pick over the carcass.
Initially with crypto exchanges, the hope was they were like, I dunno, how banks are (supposed to be, I know, I know): the smaller ones around the edges offering the best returns might be dodgy, but the big ones are run sensibly and you can trust them.
It's now pretty clear it's more like Lance Armstrong when every other athlete in the Tour De France was getting busted for drugs and he still had 7 yellow jerseys. Is it that he is the only honest man who also happens to be better than all the cheats? Of coure not, it's just that he was cheating much better than everybody else, and in hindsight, everybody goes, well yeah, that's pretty obvious.
All of which is to say, is that if Binance's books aren't in the exact same state as FXT's, and if they're not being kept afloat with their own worthless tokens and shuffling money and returns around, then colour me pleasantly surprised.
posted by Hartster at 9:49 AM on November 15, 2022 [4 favorites]
Initially with crypto exchanges, the hope was they were like, I dunno, how banks are (supposed to be, I know, I know): the smaller ones around the edges offering the best returns might be dodgy, but the big ones are run sensibly and you can trust them.
It's now pretty clear it's more like Lance Armstrong when every other athlete in the Tour De France was getting busted for drugs and he still had 7 yellow jerseys. Is it that he is the only honest man who also happens to be better than all the cheats? Of coure not, it's just that he was cheating much better than everybody else, and in hindsight, everybody goes, well yeah, that's pretty obvious.
All of which is to say, is that if Binance's books aren't in the exact same state as FXT's, and if they're not being kept afloat with their own worthless tokens and shuffling money and returns around, then colour me pleasantly surprised.
posted by Hartster at 9:49 AM on November 15, 2022 [4 favorites]
it makes me damn angry when someone uses generates an information inequality to steal from other people
posted by clew at 10:01 AM on November 15, 2022 [2 favorites]
posted by clew at 10:01 AM on November 15, 2022 [2 favorites]
Meanwhile it seems the paper of record is still not immune to this con artist’s charms: New York Times Runs Bizarre Softball Article on FTX's Sam Bankman-Fried (Matt Novak, Gizmodo).
posted by mbrubeck at 10:15 AM on November 15, 2022 [2 favorites]
posted by mbrubeck at 10:15 AM on November 15, 2022 [2 favorites]
yep quick things: I think twitter told me that Michael Lewis (of the Big Short, etc.) was shoulder surfing SBF for the last 6 months?
And this guardian article likens FTT to supermarket loyalty points which sounds right to me.
posted by drowsy at 10:29 AM on November 15, 2022
And this guardian article likens FTT to supermarket loyalty points which sounds right to me.
posted by drowsy at 10:29 AM on November 15, 2022
Heck, generating an information inequality by figuring something true out is usually honest work. It’s generating one by hiding something true that’s the pisser. Maybe there’s another word for it.
posted by clew at 10:32 AM on November 15, 2022 [1 favorite]
posted by clew at 10:32 AM on November 15, 2022 [1 favorite]
“It’s an Excel file full of the howling of ghosts and the shrieking of tortured souls. If you look too long at that spreadsheet, you will go insane.”
The Necrocryptonomincon, if you will.
posted by pwnguin at 10:55 AM on November 15, 2022 [6 favorites]
The Necrocryptonomincon, if you will.
posted by pwnguin at 10:55 AM on November 15, 2022 [6 favorites]
likens FTT to supermarket loyalty points which sounds right to me
Not really a good comparison IME. First off my supermarket isn't trying to sell me points. And I pretty much never have any problem converting points into whatever reward they supposedly accumulate for. And when they do pivot to a different program I get months to cash out.
posted by Mitheral at 11:11 AM on November 15, 2022 [1 favorite]
Not really a good comparison IME. First off my supermarket isn't trying to sell me points. And I pretty much never have any problem converting points into whatever reward they supposedly accumulate for. And when they do pivot to a different program I get months to cash out.
posted by Mitheral at 11:11 AM on November 15, 2022 [1 favorite]
What a fascinating and horrible fall from grace.
I've spent the last couple days reading blog posts / tweets and watching interviews with SBF and Caroline Ellison and I get the overwhelming impression that these young people were told from a very young age by their upper middle class parents that they would go on to do great and world-changing things. When they found themselves in perilous circumstances where others may have blinked and taken a couple steps back, I bet they charged forward because, from their perspective, all was going to plan and it was just another bump in the road to fulfilling their birthrights.
posted by sid at 11:18 AM on November 15, 2022 [7 favorites]
I've spent the last couple days reading blog posts / tweets and watching interviews with SBF and Caroline Ellison and I get the overwhelming impression that these young people were told from a very young age by their upper middle class parents that they would go on to do great and world-changing things. When they found themselves in perilous circumstances where others may have blinked and taken a couple steps back, I bet they charged forward because, from their perspective, all was going to plan and it was just another bump in the road to fulfilling their birthrights.
posted by sid at 11:18 AM on November 15, 2022 [7 favorites]
All of which is to say, is that if Binance's books aren't in the exact same state as FXT's, and if they're not being kept afloat with their own worthless tokens and shuffling money and returns around, then colour me pleasantly surprised.
This is basically it. Every single one of these systems are inherently zero sum games at a minimum, but are more often negative sum games, especially for high friction Proof of Work based blockchains.
Any and all realized fungible, spendable fiat profits have required one (or more dollars) put in for someone else to get one (or less) dollars out - AKA the Greater Fool Theorem and people speculating and gambling on Line Goes Up and more Greater Fools entering the system to support Line Goes Up.
This is further complicated by the shuffling of inherently worthless tokens around, massively overstated market caps and then the artificial price supports of "stablecoins" like Tether and USDC.
Tether in particular (which is controlled by Binance, go figure) has been observed to print billions of Tethers whenever the BTC spot price dips too much and there's been a directly correlated price increase for BTC every time they do this. They use these freshly minted Tethers to "buy" BTC or other coins directly from themselves or partnered exchanges that agree to trading and swapping in USDT.
Binance/Tether claim that every single Tether is backed by one US dollar, which is obviously horseshit and so far they've managed to avoid having open books or a full audit about this. These holdings are probably obfuscated and diversified across many, many tokens which are, of course, also inherently worthless.
You can see this betting play and action in real time on price tracking sites like coinmarketcap where almost all of the charts have price histories that mirror each other almost exactly. When BTC goes up or down, so does BCH and all of the Bitcoin forks, as well as Tether, Ripple/XRP, Dogecoin, Litecoin and many more.
In moments of extreme volatility you will also see stablecoins like Tether/USDT and USDC "unpeg" and dip or spike the opposite directions of everything else as their printers fire up to try to keep it pegged. Which is, of course, completely fucking ridiculous and not how healthy or organic markets behave.
At this point in time the anti-crypto communities and analysts generally look at Tether's volatility as a sign of impending collapse of liquidity and spot prices. IE, if we see Tether's reported value swing outside of about 85-95% of the value of one US dollar shit is about to get real. It's dipped below 90 cents a few times and then the Tether printer fired up as they tried to stabilize it.
So, yeah, there's this whole propaganda machine running all the time on various forums online - reddit's /r/bitcoin in particular - to keep bank runs from happening, encouraging retail holders to simply HODL and not cash out, or even double down and "buy the dip", which, of course, handily helps prop up market prices.
A whole lot of this mess exists and is still going specifically because of this cultish behavior, indoctrination and a false sense of there being a community and that everyone is in it together, thus capitalizing and taking advantage of how many people lack meaningful community, relationships and friendships paired with the double-dose of hopes of getting rich and financially independent.
This is deeply abusive and emotionally manipulative. It's basically a decentralized cult and a pyramid scheme combined.
Bringing it back to the zero or negative sum game problem, it's really clear at this point that cryptocurrencies don't, in fact, create wealth. They destroy it through mechanisms of financial friction, through worn out mining rigs, through wasted electricity and pollution, as well as e-waste and through transactional fees both on the blockchains themselves as miner rewards and exchange fees.
Some amount of "real" fiat goes in from Greater Fools, some lesser money comes out when people take or realize profits and exit with fiat - the exchanges skim off the cream and manipulate everything in their favor, and any real money filters upward to the top, just like a Ponzi or pyramid scheme with lots of extra steps and even more friction and waste.
And circling back to the ridiculously inflated market caps you can also see this for yourself on sites like coinmarketcap. Go to the "newly added" section and you'll see brand new tokens or coins starting up that have totally insane market caps listed, but when you look at the actual volume and trading there's like a dozen trades with a total value of, say, $5-$50 dollars in total aggregate liquidity for that time period.
If you take that knowledge and apply it to the biggest tokens or coins it starts to make more sense that it's all made up nonsense.
The really troubling thing now is, of course, that traditional finance and investment markets are putting real money into these things. Instruments or institutions like hedge funds, mutual funds, pension funds and more.
The totally fictional liquidity is only the tip of the iceberg, and when - not if - this shitty house of cards comes tumbling down it now has the potential to do some serious damage to the global markets in ways that are going to make the 2008 sub-prime mortgage scandal or 1929 stock market crash look like amateur hour because of how many small fish there are trying to swim with these sharks.
It's going to completely wipe out people who are "retail traders" with shitty dead end day jobs as well as major funds or aggregate institutional all at the same time.
There have already been hundreds/thousands of horror stories of every day people taking out huge loans or triple mortgages, maxing out credit cards, dumping their life savings and pocket change into buying and holding coins/tokens and getting completely wiped out.
There's already a huge body count of people over-investing and taking their own lives when they've lost everything they put in at speeds so fast at speeds and volatility velocities that make shorting and over-leveraging in commodity futures look sane and rational.
And this is all a pretty clear summary of why I'm anti-cryptocoins. People are already getting hurt. If someone managed to turn a profit with good timing, especially a large profit, they have directly harmed other people to realize that profit. It just happens with so many layers and obfuscation that people can happily ignore or not see or realize how they turned a profit.
posted by loquacious at 11:34 AM on November 15, 2022 [53 favorites]
This is basically it. Every single one of these systems are inherently zero sum games at a minimum, but are more often negative sum games, especially for high friction Proof of Work based blockchains.
Any and all realized fungible, spendable fiat profits have required one (or more dollars) put in for someone else to get one (or less) dollars out - AKA the Greater Fool Theorem and people speculating and gambling on Line Goes Up and more Greater Fools entering the system to support Line Goes Up.
This is further complicated by the shuffling of inherently worthless tokens around, massively overstated market caps and then the artificial price supports of "stablecoins" like Tether and USDC.
Tether in particular (which is controlled by Binance, go figure) has been observed to print billions of Tethers whenever the BTC spot price dips too much and there's been a directly correlated price increase for BTC every time they do this. They use these freshly minted Tethers to "buy" BTC or other coins directly from themselves or partnered exchanges that agree to trading and swapping in USDT.
Binance/Tether claim that every single Tether is backed by one US dollar, which is obviously horseshit and so far they've managed to avoid having open books or a full audit about this. These holdings are probably obfuscated and diversified across many, many tokens which are, of course, also inherently worthless.
You can see this betting play and action in real time on price tracking sites like coinmarketcap where almost all of the charts have price histories that mirror each other almost exactly. When BTC goes up or down, so does BCH and all of the Bitcoin forks, as well as Tether, Ripple/XRP, Dogecoin, Litecoin and many more.
In moments of extreme volatility you will also see stablecoins like Tether/USDT and USDC "unpeg" and dip or spike the opposite directions of everything else as their printers fire up to try to keep it pegged. Which is, of course, completely fucking ridiculous and not how healthy or organic markets behave.
At this point in time the anti-crypto communities and analysts generally look at Tether's volatility as a sign of impending collapse of liquidity and spot prices. IE, if we see Tether's reported value swing outside of about 85-95% of the value of one US dollar shit is about to get real. It's dipped below 90 cents a few times and then the Tether printer fired up as they tried to stabilize it.
So, yeah, there's this whole propaganda machine running all the time on various forums online - reddit's /r/bitcoin in particular - to keep bank runs from happening, encouraging retail holders to simply HODL and not cash out, or even double down and "buy the dip", which, of course, handily helps prop up market prices.
A whole lot of this mess exists and is still going specifically because of this cultish behavior, indoctrination and a false sense of there being a community and that everyone is in it together, thus capitalizing and taking advantage of how many people lack meaningful community, relationships and friendships paired with the double-dose of hopes of getting rich and financially independent.
This is deeply abusive and emotionally manipulative. It's basically a decentralized cult and a pyramid scheme combined.
Bringing it back to the zero or negative sum game problem, it's really clear at this point that cryptocurrencies don't, in fact, create wealth. They destroy it through mechanisms of financial friction, through worn out mining rigs, through wasted electricity and pollution, as well as e-waste and through transactional fees both on the blockchains themselves as miner rewards and exchange fees.
Some amount of "real" fiat goes in from Greater Fools, some lesser money comes out when people take or realize profits and exit with fiat - the exchanges skim off the cream and manipulate everything in their favor, and any real money filters upward to the top, just like a Ponzi or pyramid scheme with lots of extra steps and even more friction and waste.
And circling back to the ridiculously inflated market caps you can also see this for yourself on sites like coinmarketcap. Go to the "newly added" section and you'll see brand new tokens or coins starting up that have totally insane market caps listed, but when you look at the actual volume and trading there's like a dozen trades with a total value of, say, $5-$50 dollars in total aggregate liquidity for that time period.
If you take that knowledge and apply it to the biggest tokens or coins it starts to make more sense that it's all made up nonsense.
The really troubling thing now is, of course, that traditional finance and investment markets are putting real money into these things. Instruments or institutions like hedge funds, mutual funds, pension funds and more.
The totally fictional liquidity is only the tip of the iceberg, and when - not if - this shitty house of cards comes tumbling down it now has the potential to do some serious damage to the global markets in ways that are going to make the 2008 sub-prime mortgage scandal or 1929 stock market crash look like amateur hour because of how many small fish there are trying to swim with these sharks.
It's going to completely wipe out people who are "retail traders" with shitty dead end day jobs as well as major funds or aggregate institutional all at the same time.
There have already been hundreds/thousands of horror stories of every day people taking out huge loans or triple mortgages, maxing out credit cards, dumping their life savings and pocket change into buying and holding coins/tokens and getting completely wiped out.
There's already a huge body count of people over-investing and taking their own lives when they've lost everything they put in at speeds so fast at speeds and volatility velocities that make shorting and over-leveraging in commodity futures look sane and rational.
And this is all a pretty clear summary of why I'm anti-cryptocoins. People are already getting hurt. If someone managed to turn a profit with good timing, especially a large profit, they have directly harmed other people to realize that profit. It just happens with so many layers and obfuscation that people can happily ignore or not see or realize how they turned a profit.
posted by loquacious at 11:34 AM on November 15, 2022 [53 favorites]
That’s fairly terrifying, loquacious. What it looks like you’re saying, in TL;DR form, is that Binance’s equivalent of FTT/SRM, in terms of papering over their balance sheet, is Tether.
Holy shit, when that one implodes, it’s all over.
posted by notoriety public at 11:52 AM on November 15, 2022 [3 favorites]
Holy shit, when that one implodes, it’s all over.
posted by notoriety public at 11:52 AM on November 15, 2022 [3 favorites]
> loquacious: "Tether in particular (which is controlled by Binance, go figure)"
Hang on. I thought Tether was controlled by Bitfinex not Binance.
posted by mhum at 12:16 PM on November 15, 2022 [3 favorites]
Hang on. I thought Tether was controlled by Bitfinex not Binance.
posted by mhum at 12:16 PM on November 15, 2022 [3 favorites]
You said "when," not "if." And you were correct to do so.
posted by delfin at 12:17 PM on November 15, 2022 [1 favorite]
posted by delfin at 12:17 PM on November 15, 2022 [1 favorite]
That’s fairly terrifying, loquacious. What it looks like you’re saying, in TL;DR form, is that Binance’s equivalent of FTT/SRM, in terms of papering over their balance sheet, is Tether.
Yeah, up until fairly recently in the last few years or so that it was less terrifying that it was relatively containerized, air-gapped and firewalled inside the crypto communities and it was a lot easier to say or feel like "Oh no, you took part in a scam trying to scam others with Line Goes Up oh well anyway..." but it's now pretty obvious and clear this has been bleeding over into more traditional finance, hedges and stuff where there's going to be a lot of collateral damage to people who don't even really know what cryptocurrencies are and didn't make any of those choices.
At this point I'm deeply worried about how much of the latter has been going on.
posted by loquacious at 12:18 PM on November 15, 2022 [3 favorites]
Yeah, up until fairly recently in the last few years or so that it was less terrifying that it was relatively containerized, air-gapped and firewalled inside the crypto communities and it was a lot easier to say or feel like "Oh no, you took part in a scam trying to scam others with Line Goes Up oh well anyway..." but it's now pretty obvious and clear this has been bleeding over into more traditional finance, hedges and stuff where there's going to be a lot of collateral damage to people who don't even really know what cryptocurrencies are and didn't make any of those choices.
At this point I'm deeply worried about how much of the latter has been going on.
posted by loquacious at 12:18 PM on November 15, 2022 [3 favorites]
Hang on. I thought Tether was controlled by Bitfinex not Binance.
You're right, and it's easy to get lost in all of these exchanges. And even then, Tether is just legally loosely associated with Bitfinex.
https://en.wikipedia.org/wiki/Bitfinex#Tether
This also illustrates that there's a lot of shell companies and layers upon layers of obfuscation and bullshit going on. It's like a giant stinky onion made out of bullshit. Layers and layers of shit, if you will.
posted by loquacious at 12:22 PM on November 15, 2022 [1 favorite]
You're right, and it's easy to get lost in all of these exchanges. And even then, Tether is just legally loosely associated with Bitfinex.
https://en.wikipedia.org/wiki/Bitfinex#Tether
This also illustrates that there's a lot of shell companies and layers upon layers of obfuscation and bullshit going on. It's like a giant stinky onion made out of bullshit. Layers and layers of shit, if you will.
posted by loquacious at 12:22 PM on November 15, 2022 [1 favorite]
> loquacious: "And even then, Tether is just legally loosely associated with Bitfinex."
I suspect that once we we all find out that "legally loosely associated" is more like "entirely controlled by and enmeshed with", we're gonna see a replay of the Alameda/FTX blowup only a few orders of magnitude larger.
posted by mhum at 12:48 PM on November 15, 2022 [1 favorite]
I suspect that once we we all find out that "legally loosely associated" is more like "entirely controlled by and enmeshed with", we're gonna see a replay of the Alameda/FTX blowup only a few orders of magnitude larger.
posted by mhum at 12:48 PM on November 15, 2022 [1 favorite]
I suspect that once we we all find out that "legally loosely associated" is more like "entirely controlled by and enmeshed with", we're gonna see a replay of the Alameda/FTX blowup only a few orders of magnitude larger.
Right, and further, I think we'll find that most of the major exchanges and on/off ramps have been colluding with each other to manipulate, well, everything.
It wouldn't make sense for them to not do that. They're not fleecing each other, they're fleecing retail marks together in collusion.
We're also going to probably see reddit and the heavily censored and manipulated crypto subs get drawn into this as liable for manipulation and/or thrown under the bus, with /r/bitcoin at the top of the list.
I'm honestly and sincerely surprised that reddit hasn't already been sued or slapped with damages OR banned some of the subs for obvious manipulation just to limit their own exposure and liability - but apparently their admins are all in on it, too. To the point they've issued their own stupid NFT project for profile pics and have been trying to set up their own NFT marketplace for these stupid things.
posted by loquacious at 1:35 PM on November 15, 2022 [4 favorites]
Right, and further, I think we'll find that most of the major exchanges and on/off ramps have been colluding with each other to manipulate, well, everything.
It wouldn't make sense for them to not do that. They're not fleecing each other, they're fleecing retail marks together in collusion.
We're also going to probably see reddit and the heavily censored and manipulated crypto subs get drawn into this as liable for manipulation and/or thrown under the bus, with /r/bitcoin at the top of the list.
I'm honestly and sincerely surprised that reddit hasn't already been sued or slapped with damages OR banned some of the subs for obvious manipulation just to limit their own exposure and liability - but apparently their admins are all in on it, too. To the point they've issued their own stupid NFT project for profile pics and have been trying to set up their own NFT marketplace for these stupid things.
posted by loquacious at 1:35 PM on November 15, 2022 [4 favorites]
Binance has their own BNB token too. CZ is clearly better at something than SBF, but Binance's books must surely be similarly fraudulent.
I think Tether is more obviously fraudulent than Binance is, or FTX was, like Tether simply mints roundish figures. I think Tether was caught in outright lies about the reserves a few times, but not in flashy enough ways to bring them down, maybe due to being based more outside the US.
Tether winds up much worse ethically too, because Tether supports the BTC price, and BTC mining. All the energy waste, and CO2 emissions, by BTC is a far worse crime against humanity than really any amount of fraud.
posted by jeffburdges at 1:41 PM on November 15, 2022 [4 favorites]
I think Tether is more obviously fraudulent than Binance is, or FTX was, like Tether simply mints roundish figures. I think Tether was caught in outright lies about the reserves a few times, but not in flashy enough ways to bring them down, maybe due to being based more outside the US.
Tether winds up much worse ethically too, because Tether supports the BTC price, and BTC mining. All the energy waste, and CO2 emissions, by BTC is a far worse crime against humanity than really any amount of fraud.
posted by jeffburdges at 1:41 PM on November 15, 2022 [4 favorites]
It's worth pointing out that Tether's scam is even more audacious than has been described.
Tether claims that $USDT is backed 1:1 with dollars. That claim might make you think you can just ask Tether to hand over $100 for your 100 Tether. However, that is ... quite far from the truth.
Tether only redeems $USDT directly for dollars in amounts of 100,000 or more. They also charge a $150 fee for the transaction. This means that in practice, anyone who isn't a whale can't actually force Tether to fork over the dollars supposedly backing their $USDT. Instead, their only way to turn $USDT into dollars is to sell them to a third party (which conveniently injects actual cash into the ecosystem).
I have no doubt that Tether is also wash trading, but their basic redemption setup goes a long way to letting people move their "value" into "safe" investments with very little risk that those people can force them to prove they have the funds to back it up.
posted by a faithful sock at 2:34 PM on November 15, 2022 [10 favorites]
Tether claims that $USDT is backed 1:1 with dollars. That claim might make you think you can just ask Tether to hand over $100 for your 100 Tether. However, that is ... quite far from the truth.
Tether only redeems $USDT directly for dollars in amounts of 100,000 or more. They also charge a $150 fee for the transaction. This means that in practice, anyone who isn't a whale can't actually force Tether to fork over the dollars supposedly backing their $USDT. Instead, their only way to turn $USDT into dollars is to sell them to a third party (which conveniently injects actual cash into the ecosystem).
I have no doubt that Tether is also wash trading, but their basic redemption setup goes a long way to letting people move their "value" into "safe" investments with very little risk that those people can force them to prove they have the funds to back it up.
posted by a faithful sock at 2:34 PM on November 15, 2022 [10 favorites]
Not necessarily causation, but the correlation seems suggestive: on the day that FTX declared insolvency, [El Salvador's Bitcoin-happy president] announced that the country would sign a free trade agreement with China (The Guardian)
posted by sarble at 4:10 PM on November 15, 2022
posted by sarble at 4:10 PM on November 15, 2022
The really troubling thing now is, of course, that traditional finance and investment markets are putting real money into these things. Instruments or institutions like hedge funds, mutual funds, pension funds and more.
And why are they doing this? That's what I don't get. I don't understand how any of this is supposed to work, but it's seemed clear for awhile that's it's bullshit. People who do understand how it's supposed to work have explained that it's bullshit. So why are pension funds investing in it? Isn't there a fiduciary duty there? What a nightmare.
posted by Mavri at 5:24 PM on November 15, 2022 [8 favorites]
And why are they doing this? That's what I don't get. I don't understand how any of this is supposed to work, but it's seemed clear for awhile that's it's bullshit. People who do understand how it's supposed to work have explained that it's bullshit. So why are pension funds investing in it? Isn't there a fiduciary duty there? What a nightmare.
posted by Mavri at 5:24 PM on November 15, 2022 [8 favorites]
Overheard: You know how I know crypto isn't money? You never see TV ads for money.
I think the real big funds do it as a diversification thing. Keep some in boring/low risk stuff like bonds. Put some or most in index funds. Do some active management of some riskier things for the higher reward. Take a *very small* amount and play the lotto. You never know, it could make a steady income for a while if you frequently cash out the gains. But never what you can't afford to lose.
posted by ctmf at 5:54 PM on November 15, 2022 [6 favorites]
I think the real big funds do it as a diversification thing. Keep some in boring/low risk stuff like bonds. Put some or most in index funds. Do some active management of some riskier things for the higher reward. Take a *very small* amount and play the lotto. You never know, it could make a steady income for a while if you frequently cash out the gains. But never what you can't afford to lose.
posted by ctmf at 5:54 PM on November 15, 2022 [6 favorites]
if you frequently cash out the gains minus trading fees
Thinking about that just got me thinking the whole "stablecoin" concept is part of the scam. You can in theory back some of your gains out of the market and park it at a fixed value to prevent losing it in a downturn. Too bad the "stablecoin" is also invented by them and they still have your money. Then when the scheme crashes, that goes too.
posted by ctmf at 8:30 PM on November 15, 2022 [2 favorites]
Thinking about that just got me thinking the whole "stablecoin" concept is part of the scam. You can in theory back some of your gains out of the market and park it at a fixed value to prevent losing it in a downturn. Too bad the "stablecoin" is also invented by them and they still have your money. Then when the scheme crashes, that goes too.
posted by ctmf at 8:30 PM on November 15, 2022 [2 favorites]
I think the real big funds do it as a diversification thing.
This. Australian superannuation funds are required to invest funds in accordance with members' instructions that include options like 'sustainable industries only' and the level of risk specified by members. The fund, therefore, has to invest some money in high-risk enterprises to meet this requirement, because some members specify they want a high-risk, high-reward strategy for their portion of the money. I imagine pension funds of other types also have this 'feature' and that's why they're investing at least some in the massive risk/all-or-nothing return space.
posted by dg at 9:25 PM on November 15, 2022
This. Australian superannuation funds are required to invest funds in accordance with members' instructions that include options like 'sustainable industries only' and the level of risk specified by members. The fund, therefore, has to invest some money in high-risk enterprises to meet this requirement, because some members specify they want a high-risk, high-reward strategy for their portion of the money. I imagine pension funds of other types also have this 'feature' and that's why they're investing at least some in the massive risk/all-or-nothing return space.
posted by dg at 9:25 PM on November 15, 2022
I read today there's no wash sale rule for crypto. So you can sell, recognize a loss, and immediately buy back in. ... In case it goes up?
posted by pwnguin at 10:55 PM on November 15, 2022
posted by pwnguin at 10:55 PM on November 15, 2022
To return to an earlier point in the discussion: effective altruism is about accumulating personal power without personal wealth, and that's why it fools people and also why it's a scam. We're used to the idea that a rich person wants power but also wants fast cars and expensive houses and so on, so when we see upper class people who are happy to run the world without fast cars and mansions, we think that they're a cut above. But they're really doing the same thing: "I should make lots of money and when I make lots of money I get to call the shots based on how I dispose of the money".
We should immediately be suspicious of effective altruism because it does not actually involve turning away from what educated upper class people want - power and fame. If you are a multimillionaire who lives in a modest apartment and gives away lots of money, you are going to be on all kinds of boards and in all kinds of media. Even if you aren't a household name, you'll be well known behind the scenes to the people who matter. Your op-eds will be published wherever you find the most influential, you'll get invited to all the right parties and you'll find that your conference and travel expenses can always be covered by someone else's foundation, so you'll eat well and go to Davos and so on. The fact that you don't have a twenty million dollar house - well, that's only a loss if you want a twenty million dollar house.
So. How does one make millions of dollars? Unless one is lucky enough to be a talented actor or athlete, one usually does tech, banking or law - and of course all of those are just great for ordinary average people, right? So you run a company that creates apps that put ordinary people out of work or drop their wages below minimum, or maybe you invent surveillance tools. In short, you impoverish regular wage earners while making lots of money yourself. The power those wage-earners had (union power, political donations, power through their churches or schools, whatever) is gone, you've appropriated it by reducing them to platform-service serfs. And the cops can use your surveillance devices to make sure they don't rebel.
Now you have that power, and you get to decide where it goes. Maybe it goes to eradicate fish suffering! Maybe it goes to prevent Rokko's basilisk! Maybe you've decided for Joe Schmoe that he will drive deliveries for your platform service until he gets too old to handle the work, at which point he ends up homeless, so that you can buy malaria nets because you've decided that this is the most happiness-enhancing use of what used to be Joe's wages. Joe, of course, is too dumb and selfish to see it this way, so life in a tent will be good for him, and hell, maybe your son - who will be a squillionaire by then - can donate some tarps and warm socks so Joe doesn't freeze.
Effective altruisim is the same old song - the very rich should have fun, exciting, important jobs that make a lot of money, and they should decide how society is organized. No surprises when they turn out to be scammers, because it's been a scam all along.
posted by Frowner at 5:23 AM on November 16, 2022 [18 favorites]
We should immediately be suspicious of effective altruism because it does not actually involve turning away from what educated upper class people want - power and fame. If you are a multimillionaire who lives in a modest apartment and gives away lots of money, you are going to be on all kinds of boards and in all kinds of media. Even if you aren't a household name, you'll be well known behind the scenes to the people who matter. Your op-eds will be published wherever you find the most influential, you'll get invited to all the right parties and you'll find that your conference and travel expenses can always be covered by someone else's foundation, so you'll eat well and go to Davos and so on. The fact that you don't have a twenty million dollar house - well, that's only a loss if you want a twenty million dollar house.
So. How does one make millions of dollars? Unless one is lucky enough to be a talented actor or athlete, one usually does tech, banking or law - and of course all of those are just great for ordinary average people, right? So you run a company that creates apps that put ordinary people out of work or drop their wages below minimum, or maybe you invent surveillance tools. In short, you impoverish regular wage earners while making lots of money yourself. The power those wage-earners had (union power, political donations, power through their churches or schools, whatever) is gone, you've appropriated it by reducing them to platform-service serfs. And the cops can use your surveillance devices to make sure they don't rebel.
Now you have that power, and you get to decide where it goes. Maybe it goes to eradicate fish suffering! Maybe it goes to prevent Rokko's basilisk! Maybe you've decided for Joe Schmoe that he will drive deliveries for your platform service until he gets too old to handle the work, at which point he ends up homeless, so that you can buy malaria nets because you've decided that this is the most happiness-enhancing use of what used to be Joe's wages. Joe, of course, is too dumb and selfish to see it this way, so life in a tent will be good for him, and hell, maybe your son - who will be a squillionaire by then - can donate some tarps and warm socks so Joe doesn't freeze.
Effective altruisim is the same old song - the very rich should have fun, exciting, important jobs that make a lot of money, and they should decide how society is organized. No surprises when they turn out to be scammers, because it's been a scam all along.
posted by Frowner at 5:23 AM on November 16, 2022 [18 favorites]
The fact that you don't have a twenty million dollar house - well, that's only a loss if you want a twenty million dollar house.
And then there's the way Bankman-Fried did it, which is pretend you don't want a $20 million house but buy a $40 million penthouse in the Bahamas.
posted by clawsoon at 5:29 AM on November 16, 2022 [2 favorites]
And then there's the way Bankman-Fried did it, which is pretend you don't want a $20 million house but buy a $40 million penthouse in the Bahamas.
posted by clawsoon at 5:29 AM on November 16, 2022 [2 favorites]
Ed Zitron: The Sky Is Falling. In which we learn that FTX has been the victim of a $600M hack over the past few days; this may or may not be related to the Bahamian government now denying that funds were being withdrawn to comply with Bahamian regulations; SBF built a backdoor to hide transactions from FTX’s internal systems; Crypto.com has 20% of its holdings in a memecoin; etc.
posted by mubba at 5:58 AM on November 16, 2022 [1 favorite]
posted by mubba at 5:58 AM on November 16, 2022 [1 favorite]
I dunno Frowner, I think you're describing the reality of Effective Altruism pretty well, but the theory is that it isn't the rich who decide - it's the cold, rational, detached calculus of utility, the spreadsheets. You spend the dollar not where you want, but where the objective analysis says it is best spent.
In practice, that's impossible even with the best of intentions of course, and in reality, none of these assholes have the best of intentions.
posted by Dysk at 7:05 AM on November 16, 2022 [1 favorite]
In practice, that's impossible even with the best of intentions of course, and in reality, none of these assholes have the best of intentions.
posted by Dysk at 7:05 AM on November 16, 2022 [1 favorite]
There is a sense in which a slightly different Bankman-Fried could've been a kind of modern Robin Hood though - talking billions from financiers and cryptobros to give to the global poor. Instead we have this mess of donations to US political parties and $40m penthouse apartments.
posted by Dysk at 7:08 AM on November 16, 2022 [1 favorite]
posted by Dysk at 7:08 AM on November 16, 2022 [1 favorite]
Side note for the usual crypto faithful, who want you to believe BTC is going to lift up the global poor, I'd love an explanation how this is going to achieve it:
Yes, this is just going great, as a solution to issues with remittances and whatever other horseshit smokescreens the true believers bring up to pretend that it isn't just a giant casino full of gambling addicts.
posted by a faithful sock at 7:33 AM on November 16, 2022 [3 favorites]
Somewhere between 73 and 81 percent of retail Bitcoin buyers are likely to be into the negative on their investment, according to research published Monday by the Bank of International Settlements (BIS).(Source, at The Register)
...
The Switzerland-based bank for other central banks wanted to understand why retail investors continue to participate in cryptocurrency exchanges to trade tokens like Bitcoin. It's a mystery, given that people don't generally use cryptocurrencies to make payments, to measure value, or to finance real-world investments.
Yes, this is just going great, as a solution to issues with remittances and whatever other horseshit smokescreens the true believers bring up to pretend that it isn't just a giant casino full of gambling addicts.
posted by a faithful sock at 7:33 AM on November 16, 2022 [3 favorites]
There is a sense in which a slightly different Bankman-Fried could've been a kind of modern Robin Hood though - talking billions from financiers and cryptobros to give to the global poor.
He's the one who paid for the Superbowl Crypto ad. The plan was always to rob the poor.
posted by sohalt at 7:35 AM on November 16, 2022 [4 favorites]
He's the one who paid for the Superbowl Crypto ad. The plan was always to rob the poor.
posted by sohalt at 7:35 AM on November 16, 2022 [4 favorites]
Yes I know, which is why I said a slightly different Bankman-Fried, because this guy sure ain't it.
posted by Dysk at 7:49 AM on November 16, 2022 [1 favorite]
posted by Dysk at 7:49 AM on November 16, 2022 [1 favorite]
I dunno Frowner, I think you're describing the reality of Effective Altruism pretty well, but the theory is that it isn't the rich who decide - it's the cold, rational, detached calculus of utility, the spreadsheets.
But then, what rich person other than maybe Caligula in his more frivolous moments has actually said, "I am running society based on my whims because that's how it should work, sucks to be you"? They all always say that they are running society based on reasonable reasons that can't be questioned, whether that's the bible or eugenic principles or national security, etc etc etc. The net result is always that the very rich get to make decisions for the majority and the majority are supposed to knuckle under and suffer in this best of all possible worlds. Meanwhile the rich get flown to Davos where they eat, I dunno, fetal sheep stuffed with goji berries and fermented greens after giving a talk about how we just have to accept that Joe Schmoe will be eating out of the dumpster because only when Joe Schmoe eats week-old 7-11 sandwiches can we possibly afford to keep kids in Africa from getting malaria, that's the trade off, no other world is possible.
posted by Frowner at 8:11 AM on November 16, 2022 [7 favorites]
But then, what rich person other than maybe Caligula in his more frivolous moments has actually said, "I am running society based on my whims because that's how it should work, sucks to be you"? They all always say that they are running society based on reasonable reasons that can't be questioned, whether that's the bible or eugenic principles or national security, etc etc etc. The net result is always that the very rich get to make decisions for the majority and the majority are supposed to knuckle under and suffer in this best of all possible worlds. Meanwhile the rich get flown to Davos where they eat, I dunno, fetal sheep stuffed with goji berries and fermented greens after giving a talk about how we just have to accept that Joe Schmoe will be eating out of the dumpster because only when Joe Schmoe eats week-old 7-11 sandwiches can we possibly afford to keep kids in Africa from getting malaria, that's the trade off, no other world is possible.
posted by Frowner at 8:11 AM on November 16, 2022 [7 favorites]
Yeah, I think rich people glommed onto the idea because it's wonderful cover for selfishness, but I still think there's a difference between the origin of the (still incredibly naive) theory and ideas of eg Peter Singer, and the way actual rich people run with it in practice. A lot of the underlying theories gaver their beginnings in academic moral philosophy, not rich people justifying themselves.
posted by Dysk at 8:58 AM on November 16, 2022 [1 favorite]
posted by Dysk at 8:58 AM on November 16, 2022 [1 favorite]
re: Effective Altruism: this is from today’s Musk court case asserting that he received unwarranted compensation from Tesla:
https://mobile.twitter.com/chancery_daily/status/1592917221998632961
“ "I'm trying to take the set of actions that maximize the probability for the good of civilization. If I overallocate time to Tesla at the expense of humanity becoming a multiplanetary species, then I'm not sure that would serve the greater good."
This is in response to a series of questions posed by opposing counsel demonstrating how Musk… basically says shit and then jumps over to his next pet project, then abandons that for his next new toy.
The lack of integrity - as in, integrated-person - is astounding. It’s like a conversation with a 7 year old.
posted by Silvery Fish at 9:02 AM on November 16, 2022 [6 favorites]
https://mobile.twitter.com/chancery_daily/status/1592917221998632961
“ "I'm trying to take the set of actions that maximize the probability for the good of civilization. If I overallocate time to Tesla at the expense of humanity becoming a multiplanetary species, then I'm not sure that would serve the greater good."
This is in response to a series of questions posed by opposing counsel demonstrating how Musk… basically says shit and then jumps over to his next pet project, then abandons that for his next new toy.
The lack of integrity - as in, integrated-person - is astounding. It’s like a conversation with a 7 year old.
posted by Silvery Fish at 9:02 AM on November 16, 2022 [6 favorites]
and then jumps over to his next pet project, then abandons that for his next new toy.
Jumping to new pet projects before finishing the last one? I feel seen but I don't like how you're looking at me
posted by clawsoon at 9:22 AM on November 16, 2022 [3 favorites]
Jumping to new pet projects before finishing the last one? I feel seen but I don't like how you're looking at me
posted by clawsoon at 9:22 AM on November 16, 2022 [3 favorites]
Jumping to new pet projects before finishing the last one?
Ah, yes, but I also do not think you are arguing that you deserve a $50 billion dollar compensation package because you plan on devoting 24/7 for the rest of your life to it. Context and scale save ya here. :)
Edit: and the absolute transparent hubris of believing that what goes on in his head and his alone is the one rational path for achieving any of these untethered goals. Yeesh.
posted by Silvery Fish at 9:37 AM on November 16, 2022 [2 favorites]
Ah, yes, but I also do not think you are arguing that you deserve a $50 billion dollar compensation package because you plan on devoting 24/7 for the rest of your life to it. Context and scale save ya here. :)
Edit: and the absolute transparent hubris of believing that what goes on in his head and his alone is the one rational path for achieving any of these untethered goals. Yeesh.
posted by Silvery Fish at 9:37 AM on November 16, 2022 [2 favorites]
Also, you know, "humanity becoming a multiplanetary species" is not in itself an unquestionable good. Humanity isn't an unquestionable good. "Let's have five or ten planets of humans hurting and killing each other and destroying everything we touch" is not perhaps as compelling an argument as some people think.
CS Lewis - that ol' stopped clock - actually has some pretty good stuff about the hubris of trying to leap from planet to planet forever in Out of the Silent Planet.
posted by Frowner at 10:31 AM on November 16, 2022 [4 favorites]
CS Lewis - that ol' stopped clock - actually has some pretty good stuff about the hubris of trying to leap from planet to planet forever in Out of the Silent Planet.
posted by Frowner at 10:31 AM on November 16, 2022 [4 favorites]
I'd label "humanity becoming a multiplanetary species" as good, and maybe SpaceX helps, but..
A priori Tesla harm this goal, by helping humanity waste resources unsustainably on cars. Tesla only helps under some 12 dimensional chess theory, like you assume the wealthy shall continue driving, so moving the rich into EVs gives nations the political leeway to take cars away form the middle class.
We know Musk hates public transit, he proposed hyperloop purely to prevent rail adoption, and his BTC/DOGE tweets emitted more CO2 than Tesla saved, so de facto Musk works against a future in which humans settle Mars, etc.
We reach Mars by adapting to a life in a limited biosphere, so avoiding cars, meat, etc., adopting renewables, bicycles, and electric trains, avoiding fertilizer from fossil fuels in favor of regenerative agriculture, even if this means less total food.
“No civilization can possibly survive to an interstellar spacefaring phase unless it limits its numbers” (and consumption) ― Carl Sagan
posted by jeffburdges at 10:48 AM on November 16, 2022 [2 favorites]
A priori Tesla harm this goal, by helping humanity waste resources unsustainably on cars. Tesla only helps under some 12 dimensional chess theory, like you assume the wealthy shall continue driving, so moving the rich into EVs gives nations the political leeway to take cars away form the middle class.
We know Musk hates public transit, he proposed hyperloop purely to prevent rail adoption, and his BTC/DOGE tweets emitted more CO2 than Tesla saved, so de facto Musk works against a future in which humans settle Mars, etc.
We reach Mars by adapting to a life in a limited biosphere, so avoiding cars, meat, etc., adopting renewables, bicycles, and electric trains, avoiding fertilizer from fossil fuels in favor of regenerative agriculture, even if this means less total food.
“No civilization can possibly survive to an interstellar spacefaring phase unless it limits its numbers” (and consumption) ― Carl Sagan
posted by jeffburdges at 10:48 AM on November 16, 2022 [2 favorites]
Like Jodie Foster said in Contact: "If every planet had people like us on it, it would be an awful waste of space."
posted by straight at 10:48 AM on November 16, 2022 [3 favorites]
posted by straight at 10:48 AM on November 16, 2022 [3 favorites]
Last night, Sam Bankman-Fried DMed me on Twitter.
posted by 1970s Antihero at 12:47 PM on November 16, 2022 [9 favorites]
posted by 1970s Antihero at 12:47 PM on November 16, 2022 [9 favorites]
Some thoughts as I read the article. SRM and FTT tokens. How is this not running afoul of FTC regulations? Just because they aren’t calling it stock?
Really there’s another token called SOL? Too obvious, guys.
I can’t believe that guy said that stuff on a podcast.
I can’t believe the people who did this were sleeping on beanbags in the office. I am disappointed. I expect better from my supervillains.
funneling customer money into effective altruism. Bankman-Fried seems to have generously funded a lot of effective altruism charities
Does this mean venture capital investments or donations?
All in all, delightful article, thank you for sharing.
posted by bq at 12:48 PM on November 16, 2022
Really there’s another token called SOL? Too obvious, guys.
I can’t believe that guy said that stuff on a podcast.
I can’t believe the people who did this were sleeping on beanbags in the office. I am disappointed. I expect better from my supervillains.
funneling customer money into effective altruism. Bankman-Fried seems to have generously funded a lot of effective altruism charities
Does this mean venture capital investments or donations?
All in all, delightful article, thank you for sharing.
posted by bq at 12:48 PM on November 16, 2022
Last night, Sam Bankman-Fried DMed me on Twitter.
Unethical psychopath rating: High.
Unethical psychopath rating: High.
you were really good at talking about ethics, for someone who kind of saw it all as a game with winners and losersposted by clawsoon at 1:16 PM on November 16, 2022 [3 favorites]
ya
hehe
I had to be
it's what reputations are made of, to some extent
I feel bad for those who get fucked by it
by this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us
For techno-feudalists like this, they're always so quick to jump to "Red Team vs. Blue Team, I'm on Grey Team" style rhetoric where they believe everything is just social signaling & nobody earnestly believes what they say;
But then when it's *them*, suddenly they've got fervor & belief & they're just looking for the right autocratic Philosopher King to swear fealty to as they guide humanity into a ten-thousand-year Imperium.
posted by CrystalDave at 1:51 PM on November 16, 2022 [2 favorites]
But then when it's *them*, suddenly they've got fervor & belief & they're just looking for the right autocratic Philosopher King to swear fealty to as they guide humanity into a ten-thousand-year Imperium.
posted by CrystalDave at 1:51 PM on November 16, 2022 [2 favorites]
"Sometimes life creeps up on you," says man who just lost sixteen billion dollars.
posted by Gerald Bostock at 2:02 PM on November 16, 2022
posted by Gerald Bostock at 2:02 PM on November 16, 2022
That interview - a good reminder that we should never explain by stupidity what we can explain by malice, entitlement and lying.
He actually was sitting there mouthing nonsense platitudes about effective altruism because he wanted to fool people - he wasn't just naively believing in the best possible outcomes. And all these other people who are telling us that they should get to decide how society works because in, like, ten million years we want to be sure that we have evolved to become superintelligent interplanetary fish so that our society can live forever - what do you want to bet that they are cynically lying too, and have only the most short-term, selfish, power-hungry goals in mind?
We give these people too much benefit of the doubt. Elon Musk does not, fundamentally, give a shit about establishing a human colony on Mars. He cares about having a project that sounds cool, gives him power and allows him to deflect criticism. For now, that's Mars. If the cool and surface-plausible topic were exploring the poles to find the tunnel to the center of the earth, that's what he'd be on about. If it were about developing a miniaturization ray so that we could send itty bitty submarines around the human body, he'd be on about that.
They are arrogant, entitled and power-hungry but gesture towards some big humanity-loving vision precisely so that we will believe that they are innocent lil' geniuses who only want to control everything because controlling the Mars mission would be SO COOL.
~~
Also longtermism is so banally fucking stupid - none of these people really, truly believe that they can steer humanity's future for the next ten thousand years, that's for rubes. They know that no one can do that. They just want you to be some kind of gawping pulp-science-fiction-reality sucker so that they can relieve you of your money, your political power and probably eventually your literal plasma, organs, etc.
posted by Frowner at 2:13 PM on November 16, 2022 [19 favorites]
He actually was sitting there mouthing nonsense platitudes about effective altruism because he wanted to fool people - he wasn't just naively believing in the best possible outcomes. And all these other people who are telling us that they should get to decide how society works because in, like, ten million years we want to be sure that we have evolved to become superintelligent interplanetary fish so that our society can live forever - what do you want to bet that they are cynically lying too, and have only the most short-term, selfish, power-hungry goals in mind?
We give these people too much benefit of the doubt. Elon Musk does not, fundamentally, give a shit about establishing a human colony on Mars. He cares about having a project that sounds cool, gives him power and allows him to deflect criticism. For now, that's Mars. If the cool and surface-plausible topic were exploring the poles to find the tunnel to the center of the earth, that's what he'd be on about. If it were about developing a miniaturization ray so that we could send itty bitty submarines around the human body, he'd be on about that.
They are arrogant, entitled and power-hungry but gesture towards some big humanity-loving vision precisely so that we will believe that they are innocent lil' geniuses who only want to control everything because controlling the Mars mission would be SO COOL.
~~
Also longtermism is so banally fucking stupid - none of these people really, truly believe that they can steer humanity's future for the next ten thousand years, that's for rubes. They know that no one can do that. They just want you to be some kind of gawping pulp-science-fiction-reality sucker so that they can relieve you of your money, your political power and probably eventually your literal plasma, organs, etc.
posted by Frowner at 2:13 PM on November 16, 2022 [19 favorites]
Bankman-Fried really is the dumbest boy, isn't he?
posted by Dysk at 2:45 PM on November 16, 2022 [1 favorite]
posted by Dysk at 2:45 PM on November 16, 2022 [1 favorite]
Ultimately all these crypto-bros are libertarians who can’t accept that an unregulated free market won’t lead to utopia.
posted by interogative mood at 3:05 PM on November 16, 2022 [4 favorites]
posted by interogative mood at 3:05 PM on November 16, 2022 [4 favorites]
To borrow from a different political context: don’t just ask if they believe what they say, ask what they believe saying it will allow them to do.
posted by clew at 3:26 PM on November 16, 2022 [2 favorites]
posted by clew at 3:26 PM on November 16, 2022 [2 favorites]
No offense to drugs, but this guy is on drugs, right?
posted by Don.Kinsayder at 3:40 PM on November 16, 2022 [4 favorites]
posted by Don.Kinsayder at 3:40 PM on November 16, 2022 [4 favorites]
I do want to believe that they are all canny, cynical, amoral grifters. But we've all seen what happens when libertarians run into bears, so I have to leave some room in the appraisal for stupidness.
posted by Horkus at 3:46 PM on November 16, 2022 [3 favorites]
posted by Horkus at 3:46 PM on November 16, 2022 [3 favorites]
"Sometimes life creeps up on you," says man who just lost sixteen billion dollars.
Well, the thing is, HE didn't lose sixteen billion dollars. He convinced other people to give him sixteen billion dollars.
posted by dg at 4:30 PM on November 16, 2022 [1 favorite]
Well, the thing is, HE didn't lose sixteen billion dollars. He convinced other people to give him sixteen billion dollars.
posted by dg at 4:30 PM on November 16, 2022 [1 favorite]
Re: softball article on SBF: I'm trying to remember which podcast I listened to in order to get the gist of this whole thing (I don't understand bitcoin, I just know it makes climate change worst so it sucks). And the takeaway I definitely got from it was "SBF is the nice crypto guy that is progressive and wanted at least light regulations, CZ is the bad boy hard libertarian who wants zero regulation and fucked SBF out of revenge." I believed them because I don't follow this stuff! They even called CZ the Wario to SBF's Mario! Idk if this was Hard Fork? If so, that's put out by NYT. If that's all bullshit then... yikes?
posted by pelvicsorcery at 8:06 PM on November 16, 2022
posted by pelvicsorcery at 8:06 PM on November 16, 2022
Also, seeing that MIA's reaction to all this was to tweet antisemitism was... disappointing to say the least.
posted by pelvicsorcery at 8:08 PM on November 16, 2022
posted by pelvicsorcery at 8:08 PM on November 16, 2022
Well, let’s see if there is as much ridicule in the press when the equivalent right-wing donor goes down like this.
posted by skyscraper at 8:11 PM on November 16, 2022
posted by skyscraper at 8:11 PM on November 16, 2022
Note: I am ancient beyond days. Adjust “the press” for your cohort equivalent, including this here blue thing.
posted by skyscraper at 8:22 PM on November 16, 2022
posted by skyscraper at 8:22 PM on November 16, 2022
Idk if this was Hard Fork?
I believe it was...as for the Mario/Wario comments I want to say they were using that as a way of saying that is how the industry perceived them.
posted by mmascolino at 8:33 PM on November 16, 2022 [1 favorite]
I believe it was...as for the Mario/Wario comments I want to say they were using that as a way of saying that is how the industry perceived them.
posted by mmascolino at 8:33 PM on November 16, 2022 [1 favorite]
Is this the free market libertarian utopia a lot of cringelords keep proselytizing about?
"We need to make the free market actually free, duuuuude. Let's liberate it from the shackles of the central banksters! There's a ledger, so there'll be accountability. We're going to get filthy rich by doing nothing too!" This nonsense would be hilarious if it was as make-believe for everyone as it seems to be for this Sam Bankman-Fried character.
Don't get me wrong, the monetary system is all kinds of messed up, but this crypto thing always seemed like the opposite of a panacea to that swindle...IDK, seems like neoliberal free-market economics needs to be eliminated. Tax the billionaires and multi-millionaires into oblivion, and regulate this shit so that people can trade goods, and have some access to surplus value, but don't let a few million individuals destroy the planet and the rest of us so that they can party on yachts and zip around on private jets. It's all so pathetic because most of those filthy rich fuckers seem to be unhappy. Ugh, I got the late-stage capitalism blues too, hahaha...
posted by nikoniko at 11:23 PM on November 16, 2022 [1 favorite]
"We need to make the free market actually free, duuuuude. Let's liberate it from the shackles of the central banksters! There's a ledger, so there'll be accountability. We're going to get filthy rich by doing nothing too!" This nonsense would be hilarious if it was as make-believe for everyone as it seems to be for this Sam Bankman-Fried character.
Don't get me wrong, the monetary system is all kinds of messed up, but this crypto thing always seemed like the opposite of a panacea to that swindle...IDK, seems like neoliberal free-market economics needs to be eliminated. Tax the billionaires and multi-millionaires into oblivion, and regulate this shit so that people can trade goods, and have some access to surplus value, but don't let a few million individuals destroy the planet and the rest of us so that they can party on yachts and zip around on private jets. It's all so pathetic because most of those filthy rich fuckers seem to be unhappy. Ugh, I got the late-stage capitalism blues too, hahaha...
posted by nikoniko at 11:23 PM on November 16, 2022 [1 favorite]
let’s see if there is as much ridicule in the press when the equivalent right-wing donor goes down like this.
A billionaire shitcoiner libertarian who dodges financial regulations but makes a few soothing mouth noises about charity is hardly left wing in any useful sense. He isn't how he says he is He spent as much on a single flat in the Bahamas as he's given to US Democrats (which is hardly a utility maximising donation anyway). And you know, he donated to orgs like the Alabama Conservatives Fund - please explain how that is "left wing"?
posted by Dysk at 11:33 PM on November 16, 2022 [6 favorites]
A billionaire shitcoiner libertarian who dodges financial regulations but makes a few soothing mouth noises about charity is hardly left wing in any useful sense. He isn't how he says he is He spent as much on a single flat in the Bahamas as he's given to US Democrats (which is hardly a utility maximising donation anyway). And you know, he donated to orgs like the Alabama Conservatives Fund - please explain how that is "left wing"?
posted by Dysk at 11:33 PM on November 16, 2022 [6 favorites]
Well, let’s see if there is as much ridicule in the press when the equivalent right-wing donor goes down like this.
The CEO gave to the democrats, some other C-Suite-guy gave to republicans - they were clearly keeping their options open.
posted by sohalt at 12:42 AM on November 17, 2022
The CEO gave to the democrats, some other C-Suite-guy gave to republicans - they were clearly keeping their options open.
posted by sohalt at 12:42 AM on November 17, 2022
"Let's divvy up our political donations so I look left-wing and you look right-wing" is just another example of these guys treating political partisans as one more layer of easy marks.
posted by Tom Hanks Cannot Be Trusted at 1:42 AM on November 17, 2022 [2 favorites]
posted by Tom Hanks Cannot Be Trusted at 1:42 AM on November 17, 2022 [2 favorites]
I dunno Frowner, I think you're describing the reality of Effective Altruism pretty well, but the theory is that it isn't the rich who decide - it's the cold, rational, detached calculus of utility, the spreadsheets. You spend the dollar not where you want, but where the objective analysis says it is best spent.
Yeah but as others have said, the real objection to the ideas of Effective Altruism is their sheer banality and lack of novelty. There is a whole branch of development studies and many people who work for NGOs and governments who do actually think about where a given dollar will do the most total good. We didn't need a new name for that. The only "novel" element is coupling that to the idea that it doesn't matter how you make your money as long as the net effect is good which has a kind of logic except that the way they calculate the net effect is utterly self serving, massively undercounts the kind of wider systemic harm their conduct has - i.e. if I rip you off for $10, the loss is not $10 because frauds and other bad conduct have a much wider impact on the fabric of society.
Also longtermism is so banally fucking stupid - none of these people really, truly believe that they can steer humanity's future for the next ten thousand years, that's for rubes. They know that no one can do that. They just want you to be some kind of gawping pulp-science-fiction-reality sucker so that they can relieve you of your money, your political power and probably eventually your literal plasma, organs, etc.
"longtermism" is the same kind of banality. There's nothing novel about wanting to plan for the very long term, all of our climate change thinking is about avoiding catastrophe in the back half of this century and beyond.
What these lack is a sense of model scepticism - but only where it suits them. I.e. they are super certain that they can quantify their negative impacts on the world, and that those are small, and super certain that they can quantify their positive impacts on the world, and that those are large. In both cases, over potentially century plus time-scales. They never sit back and think, "I might be real clever but let's get real and consider the likelihood that I have made these calculations incorrectly". As a result, they end up with fragile optimisations when what we should aim for long term is to maintain our possibility-space and do things that do the most good in the largest number of cases while minimising harm
I would also point to the work of economists like Simon Caney who test the moral foundations behind decision making tools like discounting and aggregation.
See: Climate Change and the Future: Discounting for Time, Wealth, and Risk
Essentially he looks at questions like "what kinds of things can and can we not trade-off between generations" and "when is it moral to trade harms in one place against benefits elsewhere". In both cases, he notes that the idea of these trade-offs is always introduced based on trivial examples. "Would you rather have an ice cream today or two ice creams a week from now" and by the time we're using them to "decide" that the flooding of Bangladesh is a price worth paying for cheap space travel in the 2200s we have long ago lost sight of the ethical foundations of the tools that we think allows for us to make that trade-off.
The test that Caney comes up in the linked paper is that these trade-offs cannot be used for the things we think of as basic human rights. I don't know that this is necessarily robust since you still have to agree on what those are but it passes the first test I have for a decision making framework which is "does this make what I instinctively think of as the right choice and reject things I feel to be morally abhorrent?".
posted by atrazine at 4:12 AM on November 17, 2022 [9 favorites]
Yeah but as others have said, the real objection to the ideas of Effective Altruism is their sheer banality and lack of novelty. There is a whole branch of development studies and many people who work for NGOs and governments who do actually think about where a given dollar will do the most total good. We didn't need a new name for that. The only "novel" element is coupling that to the idea that it doesn't matter how you make your money as long as the net effect is good which has a kind of logic except that the way they calculate the net effect is utterly self serving, massively undercounts the kind of wider systemic harm their conduct has - i.e. if I rip you off for $10, the loss is not $10 because frauds and other bad conduct have a much wider impact on the fabric of society.
Also longtermism is so banally fucking stupid - none of these people really, truly believe that they can steer humanity's future for the next ten thousand years, that's for rubes. They know that no one can do that. They just want you to be some kind of gawping pulp-science-fiction-reality sucker so that they can relieve you of your money, your political power and probably eventually your literal plasma, organs, etc.
"longtermism" is the same kind of banality. There's nothing novel about wanting to plan for the very long term, all of our climate change thinking is about avoiding catastrophe in the back half of this century and beyond.
What these lack is a sense of model scepticism - but only where it suits them. I.e. they are super certain that they can quantify their negative impacts on the world, and that those are small, and super certain that they can quantify their positive impacts on the world, and that those are large. In both cases, over potentially century plus time-scales. They never sit back and think, "I might be real clever but let's get real and consider the likelihood that I have made these calculations incorrectly". As a result, they end up with fragile optimisations when what we should aim for long term is to maintain our possibility-space and do things that do the most good in the largest number of cases while minimising harm
I would also point to the work of economists like Simon Caney who test the moral foundations behind decision making tools like discounting and aggregation.
See: Climate Change and the Future: Discounting for Time, Wealth, and Risk
Essentially he looks at questions like "what kinds of things can and can we not trade-off between generations" and "when is it moral to trade harms in one place against benefits elsewhere". In both cases, he notes that the idea of these trade-offs is always introduced based on trivial examples. "Would you rather have an ice cream today or two ice creams a week from now" and by the time we're using them to "decide" that the flooding of Bangladesh is a price worth paying for cheap space travel in the 2200s we have long ago lost sight of the ethical foundations of the tools that we think allows for us to make that trade-off.
The test that Caney comes up in the linked paper is that these trade-offs cannot be used for the things we think of as basic human rights. I don't know that this is necessarily robust since you still have to agree on what those are but it passes the first test I have for a decision making framework which is "does this make what I instinctively think of as the right choice and reject things I feel to be morally abhorrent?".
posted by atrazine at 4:12 AM on November 17, 2022 [9 favorites]
My muzzy-headed morning thought is that if SBF manages to destroy the cryptocurrency market for good, maybe that turns out to be the altruistic achievement he was ultimately effective at.
posted by notoriety public at 4:39 AM on November 17, 2022 [10 favorites]
posted by notoriety public at 4:39 AM on November 17, 2022 [10 favorites]
My muzzy-headed morning thought is that if SBF manages to destroy the cryptocurrency market for good, maybe that turns out to be the altruistic achievement he was ultimately effective at.
This sounds like a good rabbinical question. "Does the good we don't know we're doing redound to our credit?"
posted by clawsoon at 6:02 AM on November 17, 2022 [2 favorites]
This sounds like a good rabbinical question. "Does the good we don't know we're doing redound to our credit?"
posted by clawsoon at 6:02 AM on November 17, 2022 [2 favorites]
Yeah but as others have said, the real objection to the ideas of Effective Altruism is their sheer banality and lack of novelty.
I mean, yeah? Of course - that's what I'm driving at when I say that the core ideas originate in academic philosophy. It's not really new, but the central ideas aren't really owned by Effective Altruism, it's just rebranded utilitarianism that a bunch of rich people have picked up and run with in bad faith. And like, it's not even good academic utilitarianism. But it's still true that the theory is that detached spreadsheet logic should make the decisions, not rich people. The inherent impossibility and idiocy of that position I left to the reader to deduce, and the fact that that isn't what anyone is even trying too do in practice is something I acknowledged.
posted by Dysk at 6:56 AM on November 17, 2022 [1 favorite]
I mean, yeah? Of course - that's what I'm driving at when I say that the core ideas originate in academic philosophy. It's not really new, but the central ideas aren't really owned by Effective Altruism, it's just rebranded utilitarianism that a bunch of rich people have picked up and run with in bad faith. And like, it's not even good academic utilitarianism. But it's still true that the theory is that detached spreadsheet logic should make the decisions, not rich people. The inherent impossibility and idiocy of that position I left to the reader to deduce, and the fact that that isn't what anyone is even trying too do in practice is something I acknowledged.
posted by Dysk at 6:56 AM on November 17, 2022 [1 favorite]
The issue with Effective Altruism—and with longtermism, and all these new "heady" Ideas For Dummies—is that it's not actually a philosophy. It's a marketing concept. And it's popular among people who care more about marketing than about philosophy—who are also the people who typically care more about marketing than actually making meaningful products, caring about other people, goodwill, and making society better.
It's the old XKCD joke about a programmer deciding to make a "new standard" to unify the 16 existing ones, and—voila!—now there are 17 standards. Only instead of standards, it's buzzwords, and instead of programmers, it's rich people trying to come up with brand-spanking-new phrases that'll convince the masses that they're good people.
posted by Tom Hanks Cannot Be Trusted at 7:26 AM on November 17, 2022 [4 favorites]
It's the old XKCD joke about a programmer deciding to make a "new standard" to unify the 16 existing ones, and—voila!—now there are 17 standards. Only instead of standards, it's buzzwords, and instead of programmers, it's rich people trying to come up with brand-spanking-new phrases that'll convince the masses that they're good people.
posted by Tom Hanks Cannot Be Trusted at 7:26 AM on November 17, 2022 [4 favorites]
For the curious, you can read the bankruptcy filing (pdf).
It's pretty amazing. The writer (John Ray) is the newly appointed CEO overseeing the bankruptcy (so, he came onboard after the place fell apart, purely to steward the bankruptcy). He previously oversaw Enron in a similar fashion (brought in to steward it through the court proceedings of its collapse). He pulls no punches.
posted by a faithful sock at 8:37 AM on November 17, 2022 [17 favorites]
It's pretty amazing. The writer (John Ray) is the newly appointed CEO overseeing the bankruptcy (so, he came onboard after the place fell apart, purely to steward the bankruptcy). He previously oversaw Enron in a similar fashion (brought in to steward it through the court proceedings of its collapse). He pulls no punches.
4. I have over 40 years of legal and restructuring experience. I have been the Chief Restructuring Officer or Chief Executive Officer in several of the largest corporate failures in history. I have supervised situations involving allegations of criminal activity and malfeasance (Enron). I have supervised situations involving novel financial structures (Enron and Residential Capital) and cross-border asset recovery and maximization (Nortel and Overseas Shipholding). Nearly every situation in which I have been involved has been characterized by defects of some sort in internal controls, regulatory compliance, human resources and systems integrity.If this is the state of things at the second largest crypto exchange, what exactly do you think is going on at the less successful ones (let alone the one beating it)?
5. 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. From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.
posted by a faithful sock at 8:37 AM on November 17, 2022 [17 favorites]
my stance on SBF is that he's walking longways on a teeter-totter from being a rich idiot to being a criminal fraud sociopath, and he's past the fulcrum, where someone (not I) could possibly have sympathy for the guy.
posted by shenkerism at 10:19 AM on November 17, 2022
posted by shenkerism at 10:19 AM on November 17, 2022
Honestly, I think he's just a gambling addict. Made infinitely worse by the fact that he used other people's money.
And sure, it's less about the money-buys-luxury-part (although that too; the ascetic vibe was clearly just an affectation), and more about the money-buys-power-part. Some people want power because they want to shape the world to their taste, and some people want power because they want to eliminate every potential threat, and some people want power just for the thrill of getting away with bullshit, and of course these motivations all kinda tie into each other anyway, but my guess is, the last one was really the driving passion for this guy. He probably doesn't have a vision he wants to shape the world into (which would be bad enough; why should he get to decide?), all that EA stuff was just another type of bullshit he enjoyed getting away with. So less Bond-villain-megalomaniac and more garden-variety edgelord, apparently.
Although personally I think that every Bond-villain-megalomaniac is just a garden-variety edgelord at heart, who lucked out and convinced enough rubes, but sometimes they do get high on their own supply, and keep clinging to their vision even when they stop getting away with it.
posted by sohalt at 11:13 AM on November 17, 2022 [1 favorite]
And sure, it's less about the money-buys-luxury-part (although that too; the ascetic vibe was clearly just an affectation), and more about the money-buys-power-part. Some people want power because they want to shape the world to their taste, and some people want power because they want to eliminate every potential threat, and some people want power just for the thrill of getting away with bullshit, and of course these motivations all kinda tie into each other anyway, but my guess is, the last one was really the driving passion for this guy. He probably doesn't have a vision he wants to shape the world into (which would be bad enough; why should he get to decide?), all that EA stuff was just another type of bullshit he enjoyed getting away with. So less Bond-villain-megalomaniac and more garden-variety edgelord, apparently.
Although personally I think that every Bond-villain-megalomaniac is just a garden-variety edgelord at heart, who lucked out and convinced enough rubes, but sometimes they do get high on their own supply, and keep clinging to their vision even when they stop getting away with it.
posted by sohalt at 11:13 AM on November 17, 2022 [1 favorite]
For the curious, you can read the bankruptcy filing (pdf).
This is a good read!
posted by paper chromatographologist at 12:29 PM on November 17, 2022 [2 favorites]
This is a good read!
posted by paper chromatographologist at 12:29 PM on November 17, 2022 [2 favorites]
That bankruptcy filing was absolutely unsurprising to me and, I expect, to the person writing it.
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.
It's likely they've written a similar statement before and this won't be the last time they get to say 'worst ever'. There's so little substance underneath all of these crypto companies that, were they to implement any reasonable financial control, they would have had to file for bankruptcy the day after they opened the doors. It's all nothing more than smoke and mirrors.
posted by dg at 2:19 PM on November 17, 2022 [2 favorites]
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.
It's likely they've written a similar statement before and this won't be the last time they get to say 'worst ever'. There's so little substance underneath all of these crypto companies that, were they to implement any reasonable financial control, they would have had to file for bankruptcy the day after they opened the doors. It's all nothing more than smoke and mirrors.
posted by dg at 2:19 PM on November 17, 2022 [2 favorites]
that bankruptcy filing is one of the wildest things i have ever read in accounting
they approved disbursals via emojis posted in a chat room where messages were set to auto-delete after a period of time
like they purposely set things up so there would be no audit trail
they can't produce a comprehensive list of employees or bank accounts, either
their internal controls are so bad that they don't even know who works for them or where the remaining money is
FTX is going to literally be the textbook example of "why we have accounting controls" in future accounting textbooks
posted by Jacqueline at 2:53 PM on November 17, 2022 [12 favorites]
they approved disbursals via emojis posted in a chat room where messages were set to auto-delete after a period of time
like they purposely set things up so there would be no audit trail
they can't produce a comprehensive list of employees or bank accounts, either
their internal controls are so bad that they don't even know who works for them or where the remaining money is
FTX is going to literally be the textbook example of "why we have accounting controls" in future accounting textbooks
posted by Jacqueline at 2:53 PM on November 17, 2022 [12 favorites]
Matt Levine: FTX Was Not Very Careful [a delightful run through the bankruptcy filing]
posted by chavenet at 3:28 PM on November 17, 2022 [3 favorites]
posted by chavenet at 3:28 PM on November 17, 2022 [3 favorites]
a-also: Tom Brady, Giselle Bündchen, Larry David & Steph Curry Caught In FTX Crypto Fallout With Class Action Suit
posted by chavenet at 3:50 PM on November 17, 2022 [1 favorite]
posted by chavenet at 3:50 PM on November 17, 2022 [1 favorite]
Bizarre and gossipy but possibly relevant: Tumblr Blog Linked to Ex-Alameda CEO Explored Race Science, ‘Imperial Chinese Harem’ Polyamory. Apparently the blogger is reasonably believed to be "former Alameda Research CEO Caroline Ellison, Bankman-Fried’s on-again, off-again former girlfriend".
Not directly tied to the eugenics FPP, but definitely feels like it's vibing with it.
posted by gentlyepigrams at 5:31 PM on November 17, 2022 [2 favorites]
Not directly tied to the eugenics FPP, but definitely feels like it's vibing with it.
posted by gentlyepigrams at 5:31 PM on November 17, 2022 [2 favorites]
That article about the tumblr:
“I didn’t get into this as a crypto true believer,” the Ellison-linked account wrote in March. “It’s mostly scams and memes when you get down to it."
Plus she's an enormous racist, like a real 'there are huge genetic differences" racist.
~~
Over my life, I've noticed that you can get pretty far just by...being evil and having the desire to do evil. You don't need to be smart or have a good plan, you just need to be the type of person who is really, really interested in, eg, scamming people or being racist.
It's not that there aren't a lot of racists out there, it's not that ordinary people can't hold repugnant bigoted views, it's not that, eg, most white people don't vote for racist politicians. But most people, no matter how bad their views are if you actually investigate, just don't have the interest and engagement to make racist bigoted obsession their whole thing. Most people prefer to do other things.
So if you are a person who is obsessed with "race science" or searching twitter for trans people or scamming people with crypto nonsense, etc, you don't need to be smart or good at scams, you just need to have such a weird, empty little soul that you'd rather do those things than anything else.
I mean, all these people are obviously, trivially stupid - they don't understand and apparently can't understand basic academic material, they are incapable of reasoning about history, they don't have the foggiest idea of...not even of how complex systems work but that complex systems are complex. They are not smart enough to start asking the right questions. And yet they ruined a bunch of people and will probably make some bad ripples in the global economy.
~~
The other thing I notice is that these new-model race science loons have a particular moral dead spot - you notice it with this tumblr and with the "each of our eight kids will have eight kids" eugenicists in the other post on the blue. They look at racist and violent systems and see them as hobby systems, like learning lore in a video game. They have special costumes. They can recite trivia about racist and violent systems but have no grasp of the systems' meaning. Where someone else might go into fashion or community theater, they invent costumes that convey the "gravitas" of "their work", like the eight-kids loons do. It's like they're not quite present, in a way, so no wonder they all think that human priorities should be determined by whether we can bring into being billions of simulated people on planet-sized computers in the year 20,000CE.
posted by Frowner at 5:33 AM on November 18, 2022 [8 favorites]
“I didn’t get into this as a crypto true believer,” the Ellison-linked account wrote in March. “It’s mostly scams and memes when you get down to it."
Plus she's an enormous racist, like a real 'there are huge genetic differences" racist.
~~
Over my life, I've noticed that you can get pretty far just by...being evil and having the desire to do evil. You don't need to be smart or have a good plan, you just need to be the type of person who is really, really interested in, eg, scamming people or being racist.
It's not that there aren't a lot of racists out there, it's not that ordinary people can't hold repugnant bigoted views, it's not that, eg, most white people don't vote for racist politicians. But most people, no matter how bad their views are if you actually investigate, just don't have the interest and engagement to make racist bigoted obsession their whole thing. Most people prefer to do other things.
So if you are a person who is obsessed with "race science" or searching twitter for trans people or scamming people with crypto nonsense, etc, you don't need to be smart or good at scams, you just need to have such a weird, empty little soul that you'd rather do those things than anything else.
I mean, all these people are obviously, trivially stupid - they don't understand and apparently can't understand basic academic material, they are incapable of reasoning about history, they don't have the foggiest idea of...not even of how complex systems work but that complex systems are complex. They are not smart enough to start asking the right questions. And yet they ruined a bunch of people and will probably make some bad ripples in the global economy.
~~
The other thing I notice is that these new-model race science loons have a particular moral dead spot - you notice it with this tumblr and with the "each of our eight kids will have eight kids" eugenicists in the other post on the blue. They look at racist and violent systems and see them as hobby systems, like learning lore in a video game. They have special costumes. They can recite trivia about racist and violent systems but have no grasp of the systems' meaning. Where someone else might go into fashion or community theater, they invent costumes that convey the "gravitas" of "their work", like the eight-kids loons do. It's like they're not quite present, in a way, so no wonder they all think that human priorities should be determined by whether we can bring into being billions of simulated people on planet-sized computers in the year 20,000CE.
posted by Frowner at 5:33 AM on November 18, 2022 [8 favorites]
you don't need to be smart or good at scams, you just need to have such a weird, empty little soul that you'd rather do those things than anything else.
pace Gladwell, if you put in your 10,000 hours of being an absolute fuckwit, you'll become an expert fuckwit.
still a fuckwit, tho.
posted by chavenet at 8:14 AM on November 18, 2022 [1 favorite]
pace Gladwell, if you put in your 10,000 hours of being an absolute fuckwit, you'll become an expert fuckwit.
still a fuckwit, tho.
posted by chavenet at 8:14 AM on November 18, 2022 [1 favorite]
pace Gladwell, if you put in your 10,000 hours of being an absolute fuckwit, you'll become an expert fuckwit.I hadn't seen pace used this way before, so I looked it up…
pace2 | ˈpäˌCHā, ˈpāˌsē |TIL!
preposition
with due respect to (someone or their opinion), used to express polite disagreement or contradiction: narrative history, pace some theorists, is by no means dead.
ORIGIN
Latin, literally ‘in peace’, ablative of pax, as in pace tua ‘by your leave’.
And regarding how much respect Gladwell and his 10k hour "rule" is due, might I suggest the If Books Could Kill (podcast mefi post) episode on his book Outliers? Spoiler alert, I think the amount of respect due is close to the value of FTT.
posted by Cogito at 10:55 AM on November 18, 2022 [2 favorites]
It's the old XKCD joke about a programmer deciding to make a "new standard" to unify the 16 existing ones, and—voila!—now there are 17 standards. Only instead of standards, it's buzzwords, and instead of programmers, it's rich people trying to come up with brand-spanking-new phrases that'll convince the masses that they're good people.
There is a really weird thing that happens in corporate leadership circles where new words or phrases are adopted by the head honchos and the underlings start echoing that word or phrase either deliberately or unconsciously to signal they are onboard with leadership. The problem of course is that every leadership or agenda change requires a new word or phrase and the changes are now coming so fast that there is not enough time or perhaps will to vet that the words or phrases are just harmless signifiers. It's only a matter time before someone starts promoting "Work Will Set You Free" or some other nazi horror as their corporate leadership buzzphrase. Longtermism is after all just a buzzy way of saying "the end justifies the means" which does not have a great history.
posted by srboisvert at 5:26 AM on November 20, 2022 [6 favorites]
There is a really weird thing that happens in corporate leadership circles where new words or phrases are adopted by the head honchos and the underlings start echoing that word or phrase either deliberately or unconsciously to signal they are onboard with leadership. The problem of course is that every leadership or agenda change requires a new word or phrase and the changes are now coming so fast that there is not enough time or perhaps will to vet that the words or phrases are just harmless signifiers. It's only a matter time before someone starts promoting "Work Will Set You Free" or some other nazi horror as their corporate leadership buzzphrase. Longtermism is after all just a buzzy way of saying "the end justifies the means" which does not have a great history.
posted by srboisvert at 5:26 AM on November 20, 2022 [6 favorites]
learnings
posted by clawsoon at 5:29 AM on November 20, 2022 [2 favorites]
posted by clawsoon at 5:29 AM on November 20, 2022 [2 favorites]
Amen. It felt loony toons watching the word NFT and later metaverse spread.
posted by jeffburdges at 7:37 AM on November 20, 2022 [1 favorite]
posted by jeffburdges at 7:37 AM on November 20, 2022 [1 favorite]
Both SBF and Ellison were raised by professors at “elite” higher education institutions and then went on to attend “elite” institutions themselves. I wonder if this contributed to their sense of entitlement and superiority.
posted by interogative mood at 2:49 PM on November 20, 2022 [4 favorites]
posted by interogative mood at 2:49 PM on November 20, 2022 [4 favorites]
Appears Solana aka AnalOS became a hilarious casualty too.
All large web2 systems employ database sharding, meaning they exploit locality in the data. It's worse to shard a blockchain because you must shard trust too, but real solutions exist, as does fantasy crap. Amusingly, smart contracts or "internet computer" fantasies wind up quite unstructured, so not much locality, and hence ETHv2 failing to deliver sharding. Anyways..
Solana argued sharding should be unnecessary, due to.. Moore's law. LOL Their blog was called No Sharding Zone or something. It's like their founding principles include deeply miss-understanding how databases work.
posted by jeffburdges at 6:42 PM on November 21, 2022
All large web2 systems employ database sharding, meaning they exploit locality in the data. It's worse to shard a blockchain because you must shard trust too, but real solutions exist, as does fantasy crap. Amusingly, smart contracts or "internet computer" fantasies wind up quite unstructured, so not much locality, and hence ETHv2 failing to deliver sharding. Anyways..
Solana argued sharding should be unnecessary, due to.. Moore's law. LOL Their blog was called No Sharding Zone or something. It's like their founding principles include deeply miss-understanding how databases work.
posted by jeffburdges at 6:42 PM on November 21, 2022
Genesis says they need a billion dollars or they'll fold. Who the fuck would be stupid enough to "lend" real money to these people? I love the smell of crypto collapse in the morning.
posted by seanmpuckett at 5:15 AM on November 22, 2022
posted by seanmpuckett at 5:15 AM on November 22, 2022
Who the fuck would be stupid enough to "lend" real money to these people?
Every single one of their customers.
Well, okay, some of the customers may have “lent” them magic beans instead of real money, but they did that in the belief that the magic beans were real money.
posted by notoriety public at 6:29 AM on November 22, 2022 [1 favorite]
Every single one of their customers.
Well, okay, some of the customers may have “lent” them magic beans instead of real money, but they did that in the belief that the magic beans were real money.
posted by notoriety public at 6:29 AM on November 22, 2022 [1 favorite]
Are crypto bros really selling their Lamborghinis?
The Great G-Wagen Sell-Off
posted by 1970s Antihero at 12:54 PM on November 22, 2022
The Great G-Wagen Sell-Off
posted by 1970s Antihero at 12:54 PM on November 22, 2022
> Genesis says they need a billion dollars or they'll fold. Who the fuck would be stupid enough to "lend" real money to these people?
Hello, Investor, thanks for meeting with us.
As you can see, we have two problems: A) We need one billion dollars immediately, and B) We are losing simply a lot of money (like a lot a lot) every month.
Do you want to give us the money to fix problem A and in return you can own part of problem B? Here are our bank account detai ... wait, wait, where are you going?
posted by AndrewStephens at 5:48 AM on November 23, 2022
Hello, Investor, thanks for meeting with us.
As you can see, we have two problems: A) We need one billion dollars immediately, and B) We are losing simply a lot of money (like a lot a lot) every month.
Do you want to give us the money to fix problem A and in return you can own part of problem B? Here are our bank account detai ... wait, wait, where are you going?
posted by AndrewStephens at 5:48 AM on November 23, 2022
Slipping in just before this thread gets auto-closed, FTX cryptocurrency exchange founder Sam Bankman-Fried arrested in Bahamas.
posted by clawsoon at 5:50 PM on December 12, 2022 [5 favorites]
posted by clawsoon at 5:50 PM on December 12, 2022 [5 favorites]
And once extradition and arraignment are sorted out, he'll be Sam Bankman-Tried.
posted by cortex at 5:51 PM on December 12, 2022 [2 favorites]
posted by cortex at 5:51 PM on December 12, 2022 [2 favorites]
U.S. Justice Dept is split over charging Binance lol
posted by jeffburdges at 5:54 AM on December 13, 2022
posted by jeffburdges at 5:54 AM on December 13, 2022
Transcript: The Full Testimony SBF Planned To Give To Congress
posted by jeffburdges at 8:06 AM on December 13, 2022
posted by jeffburdges at 8:06 AM on December 13, 2022
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posted by jeffburdges at 12:58 PM on November 14, 2022 [5 favorites]