My understanding (for whatever itâs worth) is that most of the reason why a full repayment looks feasible now is a combination of:
Creditors are paid back the dollar value of their assets at the time of bankruptcy. Economically itâs a bit like everyone was forced to sell all their crypto to FTX at bankruptcy date, and then the crypto FTX held appreciated a bunch in the meantime.
FTX held a stake in Anthropic, and for general AI hype reasons thatâs likely to have appreciated a lot too.
I think itâs reasonable to think of both of these as luck, and certainly a company relying on them to pay their debts is not solvent.
Perhaps. But it sounds like many[1] have been treating the fact that FTX did in fact face a liquidity crisis as strong (conclusive?) evidence of SBFâs excessive risk-taking in a way thatâs relevant for intent. And now they claim that the extent to which customers are made whole or FTX was insolvent is not relevant.
It feels like people in general are happy to attribute good luck to his decisions but not bad luck.
Including the prosecution: âits customers were left with billions of dollars in lossesâ, âthe defendant talked with his inner circle about...how customers could never be repaidâ, âBillions of dollars from thousands of people goneâ, âthere is no serious dispute that around $10 billion went missingâ...
Well, regarding Anthropic at least, this particular bet may be lucky, but if you make a bunch of high-variance bets and one of them turns out in your favor, is that still just luck?
Crypto prices in general also turned out in their favour, and without having looked into it closely Iâd guess both of those bets paying off were necessary for people to get paid back,
If the bankruptcy hadnât forced dollarization all of FTXâs customer deposits, Iâm guessing they still wouldnât be able to pay everyone back today,
Customer money wasnât supposed to be going into bets with any variance. Having a diversified portfolio reduces variance but doesnât eliminate it (and anyway I suspect FTXâs portfolio wasnât in reality very diversified, given that tech stocks and crypto have historically been pretty correlated)
My understanding (for whatever itâs worth) is that most of the reason why a full repayment looks feasible now is a combination of:
Creditors are paid back the dollar value of their assets at the time of bankruptcy. Economically itâs a bit like everyone was forced to sell all their crypto to FTX at bankruptcy date, and then the crypto FTX held appreciated a bunch in the meantime.
FTX held a stake in Anthropic, and for general AI hype reasons thatâs likely to have appreciated a lot too.
I think itâs reasonable to think of both of these as luck, and certainly a company relying on them to pay their debts is not solvent.
Perhaps. But it sounds like many[1] have been treating the fact that FTX did in fact face a liquidity crisis as strong (conclusive?) evidence of SBFâs excessive risk-taking in a way thatâs relevant for intent. And now they claim that the extent to which customers are made whole or FTX was insolvent is not relevant.
It feels like people in general are happy to attribute good luck to his decisions but not bad luck.
Including the prosecution: âits customers were left with billions of dollars in lossesâ, âthe defendant talked with his inner circle about...how customers could never be repaidâ, âBillions of dollars from thousands of people goneâ, âthere is no serious dispute that around $10 billion went missingâ...
Well, regarding Anthropic at least, this particular bet may be lucky, but if you make a bunch of high-variance bets and one of them turns out in your favor, is that still just luck?
Crypto prices in general also turned out in their favour, and without having looked into it closely Iâd guess both of those bets paying off were necessary for people to get paid back,
If the bankruptcy hadnât forced dollarization all of FTXâs customer deposits, Iâm guessing they still wouldnât be able to pay everyone back today,
Customer money wasnât supposed to be going into bets with any variance. Having a diversified portfolio reduces variance but doesnât eliminate it (and anyway I suspect FTXâs portfolio wasnât in reality very diversified, given that tech stocks and crypto have historically been pretty correlated)