Customers deposited funds for FTX to hold. FTX said "We're holding your funds; they're safe." FTX no longer has the customer funds. Why? They gave them to Alameda and Alameda traded with them and lost them (or maybe stashed some of it somewhere). That's theft, not accounting mistakes.
FTX wasn't and isn't the only protocol CEX that does this.
When Facebook sells our data to advertisers, their not stealing it. It's in their terms. It doesn't make it a fair or great thing though.
Digital copying is not theft, but since crypto cannot be copied I am fine with calling FTX’s actions stealing.
Why would SBF delete his tweet claiming funds are "never invested, not even in bonds"?
Lending money and buying bonds are functionally the same thing, albeit there is legal nuance.
What is a "protocol CEX"? I'm assuming that's a typo.
Edited for clarity
The phrase "protocol CEX" is an oxymoron.
"protocol" implies a set smart contracts, i.e., some semblance of decentralization.
A CEX could be fully off-chain.