Yes, I think we're agreed.
it's misleading to think of FTT price dropping as "the thing that was life or death for them." (Or maybe it was in a "proximate cause" kind of way, but the real problem was the reliance on FTT in the first place.)
It's more like FTT was a quasi peg, they needed to keep it up at $>20. The fight that was life and death was keeping it that high with their resources.
Yes, as you say, the FTT token wasn't worth anything even before the crash, the FTX/Alameda money to prop it up is what was operative, and is gone now.
We haven't discussed anything that would contradict the overwhelming evidence that FTX has a gap of $4B or more.
Low information threads seem undesirable if there are people who are less informed and had very high/trust in SBF, partially due to EA associations.
Are you saying you have the balance sheets for FTX? Can you link?
Unfortunately, I think what you're saying is omitting liabilities, and that makes it very uninformative.
For Alameda, other "coins" were covered in the link in my first post, it's pretty clear that they aren't worth anything, even if there was no crisis.
https://dirtybubblemedia.substack.com/p/is-alameda-research-insolvent
This is probably true of any "projects" on FTX that the entities control.
No, not at all. This "sale" already happened.
Right now, the tokens are "illiquid" in the same sense that "Charles He token" is illiquid, "depending on price".
In theory, FTT at >$20 would support the whole endeavor. Whatever happened was life and death and happened two days ago.
Whatever happened was life and death and happened two days ago.
I'd say the thing that was life and death for them wasn't so much the price of the token (that was only a trigger) but the bank run that came after the token situation hit the news. Even if the token had stayed at the same price temporarily, no one could seriously expect their stake to be worth "number of coins times price at the time" (or 50% of that, which one source reported they had "conservatively" marked it down to) given the low liquidity / low historical sales volume of the token,...
This is very sad and terrible, but I think the relevant companies are bankrupt and rescue seems unlikely. Maybe if it's helpful in some way, the newspapers Reuters and NYT contain information, if you want to read it.
Onlookers: Guys, it's a highschooler, I think there might be special duties here to people of different ages and backgrounds.
For onlookers:
Basically the tweets promote the narrative that it is a short term liquidity crisis and there is a future for FTX.
As someone who strongly supports SBF, it’s perfectly clear that FTX, and Alameda is in the beyond dire position of insolvency as reported. This tweet is performative and misleading but is the best narrative the CEO can do, this fact is also is expected and normal at the same time.
What I think: I think that FTX was insolvent such that even if FTT price was steady, user funds were not fully backed.
Yes you are right, I disagree. I think this collapse happened because of the FTT "attack" (or honestly, huge vulnerability) and Alameda was forced to defend. Without this depletion, SBF or FTX could cover these funds in a routine sense and we wouldn't hear about this.
...That is, they literally bet the money on a speculative investment and lost it, and this caused a multibillion dollar financial hole. It is also possible that some or all
I'll escrow with Nuno at any time, you can reach out to me by PM or Nuno can reach out to me.
Given that you think it's likely FTX "gambled" user funds I am really not sure we disagree on anything interesting to begin with :-[
I think this is true, but sort of productive to clarify this.
Maybe you think it's only 70% likely and I think it's a lot more than that?
I'm >90% sure FTT was collateralized in a way that had "a major role" in FTX's collapse, but like, I'm not sure exactly what that means in a causal way, and how severe it is in a moral sense. Financial engineering is complicated and I don't know much about it.
Maybe we disagree on just how big FTX's financial hole is? Could we bet on "as of today, FTX liabilities - FTX liabilites >= 4bn"? I'd go positive on that one.
It's hard to say, 4B is the ask but 8B was mentioned as a figure too. They could mean the ability to deploy some latent funds in some complex way. Honestly, this doesn't seem that meaningful.
...Dunno... Really can't tell what you believe. You commented that folks are being too negative yet seem to also think that FTX "gambled" user deposits, which sounds pretty negative to me (though we can disagree
What I think: I think that FTX was insolvent such that even if FTT price was steady, user funds were not fully backed. That is, they literally bet the money on a speculative investment and lost it, and this caused a multibillion dollar financial hole. It is also possible that some or all of the assets - liabilities deficit was caused by a hack that happened months ago that they did not report.
As far as I can tell, you don't think this. Well, if you really don't think that, and it turns out you were wrong, then I'd like you to update. I think probabil...
Wait...(the experience of actually putting real money seemed appalling and sort of scary, so I was looking through your profile to see if I would wiggle out of it.)
You're Agrippa! The guy with very short timelines, is Berkeley adjacent and knows that cool DxE person.
No, I do care about you! I respect you quite a bit. I was wrong and I retract what I said before in at least a few comments, and I apologize for my behavior. I upvoted every comment in this chain of yours. Also, I'll be happy to take any negative repercussions.
For the bet, I'l...
I'll announce here that I'll take positive, will resolve affirmatively, 50/50 on both of those, under the protest that "gambling" actually means "any collateralization strategy that failed".
I'll announce, for 50/50, I'll take positive, will result affirmatively on:
Under the protest that "gambling" actually means "any collateralization strategy involving FTT that failed".
For 50/50, I'll take negative, will not resolve affirmatively on:
You still haven't given an operationalization and at this point, we both know why.
I'll take a bet when Nuno or someone with a real name comes along.
"FTX committed fraud that caused >1bn loss of user funds"
We, and really, every prediction person here, know that's not an adequate operationalization.
You've been asked 4 times already to give an operationalization and number for me to take, which we both know you are fully able to do.
I suspect you are an FTX grantee. Since you are using EA money (well until you decide it's not convenient to call it this) do you mind sharing who you are or what your project is?
I don't really have much to say except pretty much copy and paste my reply, above and point out how wildly hostile this is. No, people are not expected to put up bets for their statements. You are perfectly able to dispute them using arguments.
This is despicable to try to weaponize this practice, partially with the motivation for financial gain, which we both know you are. Your initial comment is absolutely in bad faith.
Separately and additionally, yes, I am exactly willing to take bets once you put up numbers, exactly answering your challenge, which I do not have to do.
Because you so indicated how interested you are, please proceed by operationalizing this and putting up numbers. I will take bets on either side.
Yes, and no, can you operationalize some of the most interesting and relevant questions to you?
These might touch on:
The fully and honest true answer is sort of no.
I think legality is poorly posed or not well defined. This is hard to explain and I'm finding the current information environment on the EA forum, and really EA, exceptionally poor and this is disappointing and relevant, if elaborating contributes to the noise.
But basically, whether something is actually found i...
The moderation team[1] believes that Charles He has violated a number of Forum norms in the thread below. Because of that and a pattern of previous violations (which led to 3 separate bans in the past — 1, 2, 3), we’re banning Charles He from the Forum for 6 months.
Our Forum norms say that we strongly discourage, and may delete, “unnecessary rudeness or offensiveness" and "behavior that interferes with good discourse” — these are the violations we see in the comments below. We appreciate that Charles has unendorsed ...
It's pretty well done now. This is difficult to follow and this must have been a lot of effort, even exhausting. I think your idea to edit posts was a good one and helpful in this situation.
It's 8 billion now. The ask might be $4 billion.
"Crypto exchange Binance reversed course on a rescue offer for FTX Wednesday, leaving the prominent digital firm with an uncertain future as it faces a shortfall of up to $8 billion, according to people familiar with the matter.
Binance chose not to go ahead with...
The site has been taken private. https://www.alameda-research.com/
Sabs — do you think you want to write (negatively) about cryptocurrency in a focused way, as a longer form piece? I think this would be valuable compared to a lot of smaller comments.
Note that Hofmann/Semafor is sort of hostile, but as characterized, it's very bad for the prospects of a recovery.
It's more likely that people don't want to "hold the bags career wise"/work 20 hours a day to fix this for uncertain comp. It's not evidence of conduct (like embezzlement)—I'm pretty sure Hoffman would go for the throat if it was.
Your comment is valid. This reply is getting into sort of low quality/twitter/reddit style speculation and I might stop writing after this:
Some factors that seem different:
Overall, the negative speculation in this thread seems undue and too negative.
Without trying to make an affirmative statement about what happened at FTX or saying there wasn't any other factors, the comments in this thread ignore the reality of leverage and risk management in brokerage trading (which is what FTX effectively was).
It can be completely true that no customer funds were invested or speculated, but that the fund as a whole can still collapse due to the mechanics/dependencies of leveraged trading.
For example, Robinhood, which no one believe...
Would you be open to stating some probabilities on this topic -- for example, your probability that Sam gets convicted of fraud, is conclusively found out to have committed fraud, etcetera?
I ask because I'd potentially be interested in making some financial bets with you!
Without trying to make an affirmative statement about what happened at FTX or saying there wasn't any other factors, it seems likely that the idea "that customer funds solely belong to the customer and don't mix with other funds" is simplistic and effectively impossible in any leveraged trading system. In reality, what happens is governed by risk management/capital controls, that would almost always blow up in a bank run scenario of the magnitude that happened to FTX.
For example, Robinhood, which no one believes was speculating on customer funds, had...
Yes you're right. Yesterday morning, the title was less inflammatory and a reasonably factual statement.
The post is less relevant and sliding off the FP, I'll probably delete the entire post at some point (the comments will remain).
This is surprising, like surreal—we are in the simulation sort of vibe.
I've never seen a website indexed like this in Google scholar. Has anyone else?
What you said is valid in general. As a reply/rebuttal, I think your focus/association with "lying" is misdirected or stilted.
Basically, what probably happened to FTX is something like the financial engineering described in this link in this top level post: https://dirtybubblemedia.substack.com/p/is-alameda-research-insolvent. This take, which is quite hostile, doesn't involve lying per se.
It's extremely difficult to communicate how normalized something like the above has become, and how much of the "tech" and business success in the 2010s was the result o...
the quality of the modal post wasn't very good (for its first ~10 revisions), and clearly voted up because of who the authors are; clueful, fair comments are shouted down, while EA leaders making making similar appeals to authority/applause lines are voted up
I have no particular opinion on SBF's character, but this paragraph seems ungenerous. Other than being a prolific poster and generally swell guy, Nathan doesn't seem particularly prominent in the EA community. Certainly not as much as Jonas Vollmer, who's a key figure at many EA...
It's almost certain that the residual value after FTX.com's sale will be very low.
There are also major implications for Alameda trading and the remaining FTX entities.
Some of the thoughts in this post and thread seem pretty half baked and very uncertain, I think the pace of writing should be lower.
SBF seems like a very good person. Almost regardless of what happened, I don't think a reasonable person's opinion of him should be reduced.
All of the FTX regranters and the FTX grantees, seem to be very virtuous and effective EAs[1]. FTX funding seemed to be building deeper competency in other areas. This seems like a huge loss for EA.
I have never received or applied for FTX funding and I never took any actions to lead me being funded by the FTX FF. In the past, FTX regranters approached me.
SBF seems like a very good person. Almost regardless of what happened, I don't think a reasonable person's opinion of him should be reduced.
I think if he lied publicly about whether FTX's client assets were not invested then I think this should very much reduce a reasonable person's opinion of him. If lying straightforwardly in public does not count against your character, I don't know what else would.
That said, I don't actually know whether any lying happened here. The real situation seems to be messy, and it's plausible that all of FTX's clie...
This comment is speculative/editorial.
Coordination / Bailout
Some sort of coordination or saving of FTX seems desirable. Relevant to this, tweets by Liz Hoffman claims FTX reached out this morning privately for aid. The ask may have started at $1B, but in a few hours the need rose to $5B.
https://twitter.com/lizrhoffman/status/1590021299295768578
If this is true, it seems plausible that the smaller amount could have been secured, but the increasingly larger amounts made it difficult. This seems relevant to ideas about coordination or bailout.
 ...
What you said seems valid. However, unfortunately, it seems low EV to talk a lot about this subject. Maybe the new EA comms and senior people are paying attention to the issues, and for a number of reasons that seems best in this situation. If that's not adequate, it seems valid to push or ask them about it.
There are writing issues and I'm not sure the net value of the post is positive.
But your view seems ungenerous, ideas in paragraphs like this seem relevant:
...This isn't a snide jab at Will MacAskill. He in fact recognized this problem before most and has made the wise choice of not being the CEO of the CEA for a decade now even though he could have kept the job forever if he wanted.
This is a general problem in EA of many academics having to repeatedly learn they have little to no comparative advantage, if not a comparative disadvantage, in people and o
I understood the heart of the post to be in the first sentence: "what should be of greater importance to effective altruists anyway is how the impacts of all [Musk's] various decisions are, for lack of better terms, high-variance, bordering on volatile." While Evan doesn't provide examples of what decisions he's talking about, I think his point is a valid one: Musk is someone who is exceptionally powerful, increasingly interested in how he can use his power to shape the world, and seemingly operating without the kinds of epistemic guardrails that EA leaders try to operate with. This seems like an important development, if for no other reason that Musk's and EA's paths seem more likely to collide than diverge as time goes on.
My statement which discussed "competency" was wrong as written. It was noise without information. Additionally, my original claim did not involve people primarily being in EA-related organizations.
Sorry for the distraction. Thank you for your informative post.
Both the vibes and possibly the reality of tech layoffs/demand for SWE is falling, at least on Hacker news.
https://news.ycombinator.com/item?id=33463908
https://news.ycombinator.com/item?id=33025223
https://news.ycombinator.com/item?id=33083279
https://news.ycombinator.com/item?id=32312303
This seems useful to flag (might be big enough that it seems like an opportunity for the various orgs that are looking for SWE and other talent, even after considering fit/alignment/lemons).
I don't know anything about AI or machine learning. I'm not an EA or longtermist, I just an opportunist/chancer who heard EA has a lot of money so I added AI to my profile.
I don't agree with your post:
(Taking the post at face value) this is surprising this has so few upvotes .
(To the degree, and on the very substantial assumption that this internet content is valuable and important) this would be useful tag for a hostile AI.
Hello, if you plan on making further interactions on the forum, you might consider it useful to add your role to your profile, this would make your interactions more clear to a wider audience.
The link is probably here: https://forum.effectivealtruism.org/profile/molly/edit (this only works for you obviously).
Thanks! Updated.