FTX collapse

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gazuty
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wearthefoxhat wrote:
Sat Dec 03, 2022 8:02 pm
From what I can gather, FTX had no business bank account(s), Alameda did though, as their trading arm. (what a mess for sure)

So, all the clients deposits went to Alameda directly and FTX records can't account for the "loans" they made to Alameda. (Chapter 11 can't track the money flow)
Interesting if that is the case. That seems to indicate that no one using FTX ever asked for a transfer of their BTC back to themselves (so that they could put it in cold storage or take it to another exchange etc). Perhpas people did ask and were just given the run around until they gave up. Would be interesting to investigate that.

I'm also interested in the FTX "origin" story. How did it get going? Did SBF have some coding skills to write the software to run the exchange? Or did they just buy a trading platform from someone else, perhaps tweak it a little, and then market the crap out of it? Was SBF very good at software and very bad at business? Where is the Michael Lewis book that explains all of this.
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Archangel
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Euler wrote:
Sat Dec 03, 2022 7:05 pm
No, they were never told.
Sounds like pervasive fraud.
No doubt serious questions will be posed at the other Crypto companies
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gazuty
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Archangel wrote:
Sat Dec 03, 2022 9:39 pm
No doubt serious questions will be posed at the other Crypto companies
No questions will be asked, most people are simple rubes.
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wearthefoxhat
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gazuty wrote:
Sat Dec 03, 2022 9:35 pm
wearthefoxhat wrote:
Sat Dec 03, 2022 8:02 pm
From what I can gather, FTX had no business bank account(s), Alameda did though, as their trading arm. (what a mess for sure)

So, all the clients deposits went to Alameda directly and FTX records can't account for the "loans" they made to Alameda. (Chapter 11 can't track the money flow)
Interesting if that is the case. That seems to indicate that no one using FTX ever asked for a transfer of their BTC back to themselves (so that they could put it in cold storage or take it to another exchange etc). Perhpas people did ask and were just given the run around until they gave up. Would be interesting to investigate that.

I'm also interested in the FTX "origin" story. How did it get going? Did SBF have some coding skills to write the software to run the exchange? Or did they just buy a trading platform from someone else, perhaps tweak it a little, and then market the crap out of it? Was SBF very good at software and very bad at business? Where is the Michael Lewis book that explains all of this.

The process was that organisations/individuals would deposit bitcoin/cash and then everyone were designated tokens, (FTT). These could be used to discount dealing on their platform for trading..etc The ones that were quick enough did manage to withdraw, but as we know, the withdrawals were $$billions a day not the normal 10's of millions a day, so the liabilities soon overtook their assets. (around Nov 6th/7th/8th)

It seems, he coded the exchange in a similar way previous crypto tokens conversions had been done. ie: Bitconnect and their tokens set up. (we all know what happened to that one) It was also allowing lending/margin contracts between other clients. SBF seems to be using that as justification when agreeing to loan Alameda billions from the clients deposits.

Sounds as though those around him were all tech bods, as well as his own coding skills/talents. Also, SBF over delegated the business aspects to those he thought could run with it, ie: legal, finance, advertising/marketing. For the most part they did, Tom Brady, Formula One, and the 19 year $135 million FTX arena deal... :shock:

Reckon more will come out, but it'll take time. He went from $20 billion down to £100k in quick time, and leans heavily on his credit card...so he says.

His parents, whom are compliance experts, must have had some idea that he was short cutting the protocols. Maybe they just took the view he'll learn from his mistakes as he goes along without realising he'd crash and burn like he did.
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gazuty
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wearthefoxhat wrote:
Sun Dec 04, 2022 12:05 am
Interesting if that is the case. That seems to indicate that no one using FTX ever asked for a transfer of their BTC back to themselves (so that they could put it in cold storage or take it to another exchange etc). Perhpas people did ask and were just given the run around until they gave up. Would be interesting to investigate that.
Thanks Fox man. Hope you are well.
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wearthefoxhat
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gazuty wrote:
Sun Dec 04, 2022 5:17 am
wearthefoxhat wrote:
Sun Dec 04, 2022 12:05 am
Interesting if that is the case. That seems to indicate that no one using FTX ever asked for a transfer of their BTC back to themselves (so that they could put it in cold storage or take it to another exchange etc). Perhpas people did ask and were just given the run around until they gave up. Would be interesting to investigate that.
Thanks Fox man. Hope you are well.
Thanks, Yep all ok this end.
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wearthefoxhat
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One other point to make was that FTX (SBF) brought in a guy called Daniel Friedburg who was responsible for shafting poker players on the Ultimate Bet platform (2008)

DF.png

For those that don't know the UB scandal, linked to Absolute Poker, was that this guy and another guy Russ Hamilton ran a super-user programme to defraud millions from high stake poker players by already knowing the outcome of the hand(s).

https://www.pokernews.com/news/2022/11/ ... -42479.htm

So, FTX now had a guy that liked to bend the rules in his favour by using all means at his disposal to cheat customers/organisations by either using programmes to give him the edge or wilfully disappropriate funds in a ponzi scheme. (allegedly :roll: )

What could go wrong....wait hold my beer....

I understand the DOJ have requested an "audience" with SBF by asking him to either attend a hearing in DC or be available by zoom. SBF is yet to confirm his attendance.
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jimibt
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well, this is interesting!!!
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Euler
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jimibt
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Euler wrote:
Sun Dec 11, 2022 10:57 am
This is good read: -

https://twitter.com/adlay_eth/status/16 ... 1798799361
i love when you get to see how an individual finds these loopholes and benefits from them on a daily basis for such an extended period. kudos to the guy for both the heads up and the wit to figure it out.
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jamesedwards
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Euler wrote:
Sun Dec 11, 2022 10:57 am
This is good read: -

https://twitter.com/adlay_eth/status/16 ... 1798799361
It worries me that I don't understand a single word of this.
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mcgoo
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jamesedwards wrote:
Sun Dec 11, 2022 9:17 pm
Euler wrote:
Sun Dec 11, 2022 10:57 am
This is good read: -

https://twitter.com/adlay_eth/status/16 ... 1798799361
It worries me that I don't understand a single word of this.
Ditto :D
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Euler
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New money is like old money, but without the oversight and regulation and is more susceptible to significant fraud: -

https://www.bbc.co.uk/news/business-63953096
mikki23
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Euler wrote:
Sun Dec 11, 2022 10:57 am
This is good read: -

https://twitter.com/adlay_eth/status/16 ... 1798799361
I'd take the twitter thread with a grain of salt. In the thread he gives credit to an obvious scammer, so the intention to reveal the great edge he apparently had could be to set up the next scam or help the current one.
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wearthefoxhat
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SBF used to be part of a forum-chat group called; Wirefraud. :shock:
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