Sam Bankman-Fried is ‘under supervision’ in Bahamas? | Hacker News Reader

Sam Bankman-Fried is ‘under supervision’ in Bahamas?

cointelegraph.com

63 pointsKarunamon73 comments

People have been saying stuff like this about Bankman-Fried for days now. It's an easy story to tell. When it's for real, the source will be better than a "source familiar with the matter", and it'll run somewhere more credible than Cointelegraph.

I would wager multiple BTC (if I had them) that Cointelegraph has far better and reliable contacts among insiders within the crypto space than NYTimes, FT, Economist, CNBC, etc.

Maybe, but cointelegraph also has no sources (best guess) in law enforcement, IC/fincen, etc.

The others very likely do, and it's been long enough that anyone who'd care has long ago adapted to the crypto space anyway. It would've been a different story five years ago, but not today.

Why do people flee to Dubai? It's my understanding they almost never naturalize non-arabs, so any fugitive would forever be on perilous grounds.

Honestly the dude could be in a boat god knows where in the Caribbean, slipping in and out of international waters to the point where no one knows where he is.

Dubai is a good stopping off point before you disappear forever. They are very happy to take bribes from rich people and they will let you set up your infrastructure so that you can go off grid.

85% of Dubai is immigrants. Not all fraudsters are high profile enough to spend millions of dollars in extradition proceedings on especially when you'll just catch them at an airport eventually.

They take bribes in the form of local business investment. If you can dump a few hundo k a year into the economy, they’ll let you get away with almost anything

It's slowly beginning to change. They used to fight but they don't care as much about non Emiratis anymore. Even less diplomatically important countries like South Africa have gotten extraditions. Look at Ramon Abbas ("Ray Hushpuppi"). Spent much of his BEC millions in Dubai and still got shipped off to America.

He was running scams out of Dubai. Big bad look for them. If you take your winnings and lay low, they’ll probably leave you alone.

Dubai is one of the few counties that lacks an extradition treaty with the US[1] and has a high standard of living.

[1] https://en.wikipedia.org/wiki/List_of_United_States_extradit...

What happens if the US cancels his passport? It's my understanding Cody Wilson was kicked out of Taiwan, which lacked formal extradition agreement, by cancelling his passport which nullified his legal presence in the country.

If SBF is smart he has two or three passports like Peter Thiel and Justin Sun.

I mean, while functionally true, the lived experience for a Dubai millionaire versus a typical immigrant labourer. They can afford to make expenditures to make their life easier. Which is good - it increases the chance they eventually slip up.

lmaooooo. EA has always seemed like a bullshit larp for extremely online and naive people. i dont know how anyone took it seriously.

in the end this is just another retelling of the same old boring finance lessons Buffet or Taleb or Burry or hundreds before them know. high leverage is the only way to get rich QUICK but it can wipe you out just as quickly. crypto is generally bullshit, the leaders are mostly grifters and its good to see the tide finally revealing them for who they are.

no one seems to talk about how all the underlying concepts of finance apply identically to crypto as they do to any boring old currency, asset, stock, option or any financial instrument. but they do.. moving to a blockchain does not change any of that in the slightest.

Sam is basically George Bluth now

Uh, what? SBF being a fraud and a criminal doesn't indict EA in any way. He was also an avid wearer of t-shirts and unkempt hair, are those things are discredited now as well?

He didn’t wear that stuff as motivation for his money and power chasing. Nor did the tshirt and unkempt hair community galvanize around him and accept his purported billions.

I just dislike how SBF and many others of approximately the same moral fiber use EA as a way to build up their reputation as some sort of noble philanthropist. Its an old and obvious trick.

EA itself is not necessarily bad or discredited, but ultimately im not interested in some theoretical definition of EA. What matters is who the real people practicing EA actually do with the money, and many of those people are like Sam in my opinion. Many are NOT frauds and genuinely do want to help people too, so of course it doesn't completely discredit EA either.

Its just sort of stupid how much its talked about as if the idea of trying to do the most good with the least resources is some kind of gigabrain idea. No, thats literally what any sincere charity aims to do.

He was funding a lot of it and they didn’t seem to particularly care that he was obviously a fraud. Their earn to give position actually commands you to become such a fraud to give them money.

Which they spend on castles (https://twitter.com/simpleteo/status/1591069362076590081) and pretending all other charity is “ineffective and selfish” because it doesn’t have “effective altruism” right in the name.

I mean, was he *obviously* a fraud? You could easily short FTT if you thought that was the case. Additionally, any number of hedge funds could have, and it would have collapsed if they had (the reason this unravelled was a big sale of the token)

Maybe you mean in hindsight he was obviously a fraud? But then that criticism doesn't apply to people who took the money before the fraud was revealed.

It’s hard to short something when you can’t trust the exchange. You shouldn’t short USDT either even though Tether is a fraud, because they can fraud harder and blow you up first.

Just avoid the business, and don’t grow your nonprofits relying on him paying you.

My point is that actually while everyone knows tether is a fraud, it was not actually obvious SBF was a fraud. Unless you're relying on a generic "everything crypto is fraud" heuristic (which, fine, but not clear why SBF would merit special attention before this week)

I didn’t know this until just now (since I was avoiding the industry and didn’t need to research anything), but it seems like “the company is run by a polycule of stimulant abusers in the Bahamas” is a bad sign.

https://twitter.com/sbf_ftx/status/1173351344159117312

https://twitter.com/carolinecapital/status/13790363463003054...

yeah, I mean that's the definition of hindsight. Once something happens, you can look back and comb for warning signs.

But that doesn't mean it's reasonable to have a rule like "If someone does stimulants and is polyamorous, dont let them give you money, they're definitely running a scam"

The VCs who goosed FTX and Scam BF with hundreds of millions, resulting in 4 years of feckless tech and finance media fawning over this moron and his supposed "genius" as well as furthering the cancerous spread of crypto into mainstream consciousness, these elite ur-capitalist gatekeepers of gererational wealth - had the 'benefit' of due dilligence before jumping on board. They are now writing down their investments to $0.

Their due diligence includes

- listening to him claim he’s never read a book in his life

- noticing he was playing League of Legends during the pitch meeting while presenting FTX as an everything app like WeChat

Which are also things I think I could preemptively say are bad.

Though, Sequoia’s also known for firing founders from their startups, so they probably benefit from seeming very generous to new pitches.

I'm sorry but these two points are extremely disconnected. EA really has no bearing on the financial mechanisms that undid SBF. Furthermore, although he was a prime donor to EA, I don't think his involvement with it necessarily discredits them.

He’s one of EA highest profiles adherents. EA style thinking permeates SBF.

This is the world EAs want - the one they’ve been advocating for a long time.

It’s just in this iteration it failed. If the chance of success was higher than X% vs the risk of failing, it was all worth it. That’s the kind of morally bankrupt philosophy EA pushes.

Doesn’t discredit them but it does bankrupt them. What does discredit them is them claiming “we’re going to go on making charity effective and rational” as if everyone else who works at a nonprofit makes decisions with an Ouija board.

> EA really has no bearing on the financial mechanisms that undid SBF.

It had bearing on the ethical/moral decisions he has been making. EA has allowed him to justify doing blatantly illegal acts.

It’s more likely he tried to cover up massive Alameda losses due to all the usual reasons people turn to illegal acts: shame, myopia, gambling addiction. One core EA principle is integrity. If he was actually “EA”, this wouldn’t have happened the way it did.

That’s no true Scotsman.

There's a Twitter thread where SBF said he's willing to take unlimited risk, far beyond what is theoretically optimal, because it's for the good of humanity.

easy to say when youre taking on that unlimited risk using other people's - err, humanity's - money.

No wonder SBF went hard into the social capital accumulation game almost immediately, buying off politicians and grandiose charitywashing gestures. His window to establish a network of elite string pullers was short and closing fast.

> crypto is generally bullshit, the leaders are mostly grifters and its good to see the tide finally revealing them for who they are.

All the grifters who hopped on post 2020, yes

But the actual implementation of a p2p electronic currency that cuts financial institutions out of the equation? This isn't bullshit, just math. There's a reason why the NYT is so hostile to crypto, and it isn't "the environment"

What is EA?

Effective Altruism. It’s a jumble of buzzwords used by insanely wealthy people to justify why they should have all of the money.

Isn't it about giving away money?

It involves first having a bunch of money, then giving it away. The general trend is that most people fail to move past Step 1.

Ostensibly. One critique is that it's a justification for accumulating wealth at all costs because purveyors of EA style themselves as uniquely capable of utilizing that money for good.

Effective Altruism

Steal money from people. Make yourself and your VC crook buddies like Sequoia rich. Board a private jet to Dubai. I mean why not? If you drop morals, this is a great gig.

3 days ago, "Sequoia has marked its investment in FTX down to $0": https://news.ycombinator.com/item?id=33541344

How many FTT coins were the Sequoia partners given as part of the deal or sold at very low prices? AFAIK from the crypto deals in VC I've been an observer to that is the normal way business occurs. We give you $200m you sell each partner $50m worth of your scam coin for $50,000.

2 days ago, "FTX’s Bankman-Fried Quietly Invested More than $500 Million in Sequoia and Other VCs"

Honestly, if I was knowingly running a $10B scam, buying into the mastermind criminal lifestyle, and it was obviously collapsing, the first thing I would do would be to flee the country to a place without an extradition treaty.

Why did they stick around? Incompetence?

When you tell a lie so many times, you start to forget that it is a lie and you live it as truth.

Yeap. That’s probably what happened here.

You’re assuming an intentional scam frame of mind instead of increasing “i know this is wrong but it’ll save things” frame of mind. Criminals are stupid and rarely think of themselves as openly malicious.

Making a competent escape plan is admitting to yourself that there’s a good chance of getting caught and jailed. People in this situation are more likely to be of a mind to think they can save things and get away with it.

Well it's not clear how much customer funds were diverted to SBF & co if any at all (though the recent "hack" makes me incredibly suspicious). If that Coindesk article never was released Alameda could've eventually paid back the loan to FTX and no one on the outside would've been the wiser. If they wanted to just exit scam the customer funds there would've been a much cleaner way to do it where by the time anyone found out they'd already be in some GCC country or Moscow.

> If that Coindesk article never was released Alameda could've eventually paid back the loan to FTX and no one on the outside would've been the wiser.

I don't know about that, the loans were huge. Billions of dollars. It's extremely unlikely that a (unprofitable) hedge fund can turn around its business and make that money back in a short time frame. Not impossible, but very unlikely. It must've been obvious to the insiders that the probability they'll get away with this is very low. Hard to believe they'd gamble their lives on that small chance.

I'm wondering how exactly Alameda managed to be so unprofitable. They literally had the easiest trading job in the world: Market make on their own exchange while seeing all order flow and being able to front-run anyone they want.

I think everyone else thought this too:

> I'm wondering how exactly Alameda managed to be so unprofitable. They literally had the easiest trading job in the world: Market make on their own exchange while seeing all order flow and being able to front-run anyone they want.

This is why FTX imploding was a surprise. We thought they were profiting from their own order flow. No need for a true scam.

Yeah very few things that are that copacetic are actually "coincidences" so I suspect you are right. The only other thing I could come up with were Russian/Chinese/North Korean hackers had a back door, read Bloomberg, and drained it while they could.

> If that Coindesk article never was released Alameda could've eventually paid back the loan to FTX and no one on the outside would've been the wiser.

Alameda needed the loan because they were losing money.

Why did you assume they would have been able to suddenly make the required billions?

I'm wondering the same thing. He must've known for a long time it'll come crashing down eventually and made proper arrangements. Perhaps the sources are fake and he has already fled.

If I were to find myself in the middle of running such a scam and was a billionaire I would spend all my waking hours preparing ways to get out of it.

I think this kind of reasoning comes from ‘you’ as you are now imagining yourself suddenly ‘finding yourself’ in that situation - a bit like the character in Quantum Leap.

SBF seems like Evel Knievel - i.e. he became identified with being SBF. It wasn’t a heist as such. Just the byproduct of him playing this fictional ‘genius’ character, and then getting so into it that he forgot it was just a role play.

Yeah I get what you're saying and there's something to it. It's just difficult to imagine to become disillusioned to the point where you're not realizing your criminal actions.

I think something like Theranos is a different story. In that case it would've been much harder to escape for the founder. But for someone in crypto like SBF...

I am think he knew something was wrong, but probably was in denial about it, and held on to the idea that as a genius he’d be able to get out of it.

Absence of an extradition treaty is usually not enough. Especially in a dictatorship like the UAE.

He was going to tunnel his ultimate do-gooding to a future century. Turns out, it seems, remaining funds were tunneled out via a freeze-plug, and the founders are trying to tunnel to Dubai.

Effective altruist but ineffective criminal

I wonder why he didn't head for Russia, China, or Nicaragua or something?

I see strong support for crypto “assets” in the $0 range.

But if you fit to a infinitely parameterized ML-boosted quantum inverted hypersonic cosine it’s quite clear that it’s nothing more than a strong buy signal ready for a 125x breakthrough prior to the next decadium /s

The thing is, Bitcoin will always have intrinsic value even if everybody sell their coins because some idiots like me invested in this thing long time ago and lost their keys.

All this lost and irrecoverable money is a good basis for valuation.

Also, one question: where are all these people who claimed that Bitcoin was a good inflation hedge ?

> Bitcoin will always have intrinsic value even if everybody sell their coins because some idiots like me invested in this thing long time ago and lost their keys.

Lost coins are not support for intrinsic value. Use-value that doesn't depend on the market is intrinsic. Value from perceptions and perceived scarcity (even if the perception is driven by actual scarcity) is extrinsic.

But I don't think lost coins supports the existence of even extrinsic value; it might be an extrinsic >1 multiplier on value from some other source by increasingn scarcity, but it won’t provide a baseline of value if nothing else does.

> where are all these people who claimed that Bitcoin was a good inflation hedge?

Same place they always were: making bad takes in relative anonymity with zero consequences for being wrong. And that’s fine: you should be able to say dumb things anonymously with no consequences.

The consequences come for the people who make investments on the basis of anonymous shitposts

Why is the unrecoverable money a good basis for valuation? It just means the total number of coins is slightly lower.

What happened to the key?

I think society is desperate for inflation hedges so perhaps it’s a strong marketing tool regardless of how accurate it might be.

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