Many people outside the rat sphere in my life think the whole FTX debacle, for instance, is ridiculous because they don’t find SBF convincing at all. SBF managed to convince so many people in the movement of his importance because of his ability to expound and rationalize his opinions on many different topics very quickly. This type of communication doesn’t get you very far with normal, run of the mill folks.
I ignored SBF and the crypto crowd, however I disagree with this primarily because I think this is predictably overrating how much you wouldn’t fall for a scam. We need to remember that before SBF collapsed, 1 million at the least decided to go on the FTX train, and the mainstream financial media was fawning SBF. So while I do think EA failed here, IMO the real failure is crypto until November was treated as though it was legitimate, when it isn’t.
Your comment minimizes EA’s role in getting SBF as far as he got. If you read the now-deleted Sequoia article it’s clear that the whole reason he was able to take advantage of the Japan crypto arbitrage is because he knew and could convince people in the movement to help him.
Most of the million who hopped on the crypto/SBF train were blatantly speculating and trying to make money. I see those in EA who fell for it as worse because they were ostensibly trying to do good.
If I were to extract generalizable lessons from the FTX, the major changes I would make are:
EA should stay out of crypto, until and unless the situation improves to the extent that it doesn’t have to rely on speculators. One big failure is EAs thought they could invest in winner stocks more than other investors.
Good Governance matters. By and large, EA failed at basic governance tasks, and I think governance needs to be improved. My thoughts are similar to this post:
I ignored SBF and the crypto crowd, however I disagree with this primarily because I think this is predictably overrating how much you wouldn’t fall for a scam. We need to remember that before SBF collapsed, 1 million at the least decided to go on the FTX train, and the mainstream financial media was fawning SBF. So while I do think EA failed here, IMO the real failure is crypto until November was treated as though it was legitimate, when it isn’t.
Your comment minimizes EA’s role in getting SBF as far as he got. If you read the now-deleted Sequoia article it’s clear that the whole reason he was able to take advantage of the Japan crypto arbitrage is because he knew and could convince people in the movement to help him.
Most of the million who hopped on the crypto/SBF train were blatantly speculating and trying to make money. I see those in EA who fell for it as worse because they were ostensibly trying to do good.
I agree that EA failed pretty hard here. My big disagreements are probably on why EA failed, not that EA failed to prevent harm.
What would you say caused EA to fail?
If I were to extract generalizable lessons from the FTX, the major changes I would make are:
EA should stay out of crypto, until and unless the situation improves to the extent that it doesn’t have to rely on speculators. One big failure is EAs thought they could invest in winner stocks more than other investors.
Good Governance matters. By and large, EA failed at basic governance tasks, and I think governance needs to be improved. My thoughts are similar to this post:
https://forum.effectivealtruism.org/posts/sEpWkCvvJfoEbhnsd/the-ftx-crisis-highlights-a-deeper-cultural-problem-within
These are the biggest changes I would make on the margin, IMO.