I agree. It seems like FTX collapsed quickly after some truths about their financial situation were revealed. Not to put too fine a point on it, it may turn out that Sam is a con artist. I don’t doubt the sincerity of his commitment to EA causes, but it now seems plausible that, like a problem gambler trying to hide it from his family, the FTX execs piled up shady debts through self-dealing.
SBF has been a friend to EA, but blindly supporting friends while ignoring potential victims is not the kind of hard-nosed truth-seeking that EA values. I’d previously considered him a kind of hero but we may need to rethink that, depending on how things develop.
Fair point, I suppose— if it turns out that FTX was doing something extremely dodgy/illegal, I might no longer endorse that sentiment. I appreciate the counterargument :)
That said, I still think it’s important to remember that SBF and his team are real people with real feelings. There are enough people screaming at them on Twitter already.
Extending some grace seems like a good place to start, even if it turns out that they made some less-than-optimal decisions
Overall, the negative speculation in this thread seems undue and too negative.
Without trying to make an affirmative statement about what happened at FTX or saying there wasn’t any other factors, the comments in this thread ignore the reality of leverage and risk management in brokerage trading (which is what FTX effectively was).
It can be completely true that no customer funds were invested or speculated, but that the fund as a whole can still collapse due to the mechanics/dependencies of leveraged trading.
For example, Robinhood, which no one believes was speculating with customer funds, had a huge crisis in Jan 2021, that needed billions of dollars of outside money. This was just due to customer leverage and moderately more instability in stock (and probably bad risk management).
Would you be open to stating some probabilities on this topic—for example, your probability that Sam gets convicted of fraud, is conclusively found out to have committed fraud, etcetera?
I ask because I’d potentially be interested in making some financial bets with you!
Yes, and no, can you operationalize some of the most interesting and relevant questions to you?
These might touch on:
Alameda Research
FTX
Legal acceptability of FTX’s collateralization strategy
The fully and honest true answer is sort of no.
I think legality is poorly posed or not well defined. This is hard to explain and I’m finding the current information environment on the EA forum, and really EA, exceptionally poor and this is disappointing and relevant, if elaborating contributes to the noise.
But basically, whether something is actually found illegal will depend on the administration, style of prosecutor, and political and social environment that could vary wildly, along with many other details. For evidence, see what happened to the 2008 financial crisis, where there was almost no criminal prosecution.
More importantly, the moral meaning of the activity versus what is found illegal can be unintuitive or misleading and this seems more important. I seriously distrust whether people here understand the moral meaning of these actions and I would find the aspects of a prediction to be sort of a predictable and distasteful spectacle.
Also, since I’ve never come close to this kind of activity in any sense, I don’t know much and I don’t care much about the actual relevant laws, especially things like jurisdiction e.g. significance of Bahama, which could be pivotal. (This by the way is one example where the meaning of this question is uninteresting.)
I again reiterate my strong belief in the character and decision making of SBF, which is counter to the would be “mood” right now.
The moderation team[1] believes that Charles He has violated a number of Forum norms in the thread below. Because of that and a pattern of previous violations (which led to 3 separate bans in the past — 1, 2, 3), we’re banning Charles He from the Forum for 6 months.
Our Forum norms say that we strongly discourage, and may delete, “unnecessary rudeness or offensiveness” and “behavior that interferes with good discourse” — these are the violations we see in the comments below. We appreciate that Charles has unendorsed some comments and excerpts, but we don’t think this resolves the issue. Moreover, because Charles has violated norms before (and been banned repeatedly), we’re expecting a higher standard of norm-following from Charles.
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As I mentioned before, it’s understandable to have strong feelings around this topic, but we expect Forum users to express themselves in a more productive way. Please try to assume good faith and be kind.
Can you just operationalize a few things yourself and attach numbers to them? That sounds easiest.
For example, your odds on whether SBF literally goes to prison within the next 4 years… (Though I think there are better ways to operationalize)
If you can’t come up with a way to operationalize a prediction on this topic in any straightforwardly falsifiable way then that’s okay I guess, though kind of sad.
Hey, by “sad” are you implying an askance view that I am either being evasive or inadequate?
I think so because you initiated this and won’t provide details of the bets and the tone of other text this: “If you can’t come up with...straightforwardly falsifiable way .”
I would find that derogatory, especially based on my detailed elaboration above, e.g. making me ponder and bet on whether someone I don’t think should be hurt is hurt and forcing me to study the legal details and put up my money to do so.
Separately and additionally, I correctly suspect that asking me to put up the numbers give you a major advantage, and you are attempting to take advantage of perceived emotional errors, by literally taking my money.
The above is plausible, and well, remarkably hostile under the circumstances.
That seems sort of like the perfect example of why someone would object to a prediction market.
I don’t really want to open up the “prediction market” thing, but I will ruthlessly do so, if this is pressed.
If you don’t want to make a single quantifiable prediction on this topic, after making claims about other people’s predictions being “too negative”, yes I consider that both evasive and inadequate.
If you really believe people are being “too negative” in their speculation, I thought you might be willing to put your money where your mouth is in some way. If you’re not, then you’re not, but it’s got nothing to do with how well defined legality is, the moral meaning of illegality, etcetera.
Edit: I don’t actually really think that a social expectation of financial betting is a good norm (not that betting is bad, just that declining to financial bet is fine). Please interpret “putting your money where your mouth is” as referring to reputational stake from making a concrete prediction on fraud/malfeasance/etcetera.
I don’t really have much to say except pretty much copy and paste my reply, above and point out how wildly hostile this is. No, people are not expected to put up bets for their statements. You are perfectly able to dispute them using arguments.
This is despicable to try to weaponize this practice, partially with the motivation for financial gain, which we both know you are. Your initial comment is absolutely in bad faith.
Separately and additionally, yes, I am exactly willing to take bets once you put up numbers, exactly answering your challenge, which I do not have to do.
I think that putting up probabilities is and should be expected. I think that actual financial betting shouldn’t be expected but is certainly welcome.
If I was going to dispute the first thing I would do is ask for probabilities. It seems weird to try to argue with you about whether your predictions are wrong if I don’t even know what they are. For all I know we have the same predictions and just a different view of other posters’ predictions.
I literally explained why I don’t want to give probabilities. I like, literally spent my time writing out a good faith reply to you, assuming a good faith comment.
Since you actively disagree, and you actively want to make a bet on this, you are perfectly able to do the work to set probabilities and I can take them.
As we both know, the construction of the probabilities, is entirely distinct from willing to put up money for the beliefs.
No, don’t try to walk this back, you know what you did. Give the probabilities.
In one year we can make a thread that asks EA forum users to vote on whether they believe >90% odds that SBF fraudulently handled funds (that is, in a way that was directly contradictory to public representation of handling funds) in a way that costed FTX.com customers >1bn in losses. If a majority of users (whose accounts existed since yesterday, to prevent shenanigans) vote yes, then the bet resolves YES. Otherwise NO.
Hey, no? Because EA forum votes is literally nothing no one cares about, and which I explicitly said in my top thread are bad, and you’re deliberating using this as a ploy to get me to refuse? How about 50⁄50 on an actual real world event?
Also, as mentioned, beginning the “prediction market thing”, can you tell me, like not as a real name thing, but do you have like an an account on a prediction market? Are you associated with the grantees on their prediction market projects?
The real world event would be “FTX committed fraud that caused >1bn loss of user funds”. But if it’s a bet somebody has to arbitrate the outcome, you know? I just picked EA forum users as an arbitator since like, that’s the venue here. But if you have any other picks for arbitrator that would be fine. You can pick yourself but I’m not sure I’d agree to that bet. Likewise I assumed you wouldn’t go for it if I picked me. And if it’s the 2 of us well then we might tie.
> but do you have like an an account on a prediction market Multiple
> Are you associated with the grantees on their prediction market projects? I am not sure that I understand this question. I have myself recieved a grant to work on a prediction market project.
“FTX committed fraud that caused >1bn loss of user funds”
We, and really, every prediction person here, know that’s not an adequate operationalization.
You’ve been asked 4 times already to give an operationalization and number for me to take, which we both know you are fully able to do.
I suspect you are an FTX grantee. Since you are using EA money (well until you decide it’s not convenient to call it this) do you mind sharing who you are or what your project is?
I’m sorry but I really don’t understand why you think it’s not adequate. “Fraud” is quite well-defined, and “loss of user funds” is also quite well-defined.
I would offer odds on like, criminal prosecution results, but that will take such a long time to resolve that I don’t think it makes an attractive bet. As you point out there are also jurisdictional questions.
Is “SBF lied about the safety of user funds on FTX.com″ better to you? “FTX used user funds to make risky investments”? “SBF mislead users about the backing of their FTX.com accounts”?
“Such a long time”? One of your first comments suggested a 4 year term.
“lied” “fraud”, are inadequate because they are inflammatory , loaded terms, which you don’t expect me to agree on, and this feature is being used as a wedge, for rhetorical reasons. I will take a bet like “found guilty for X/paid a fine of X”, which are actual events that happen.
For the fifth time, you fail to give a concrete bet. The real product of this interaction for you is not a bet, but a remarkably hostile attempt at aggression and embarrassing someone with different beliefs than you.
This is what all your EA rhetoric really masks. It’s sad that Sam might have surrounded himself with people like you.
As an aside it is surprising to me that I seem at all to you like the type of person Sam might have been surrounded with. I don’t think anyone remotely insider-y has ever even slightly felt that way about me.
[ EDITED: You probably downvoted me because my comment about this person sounded like something else that was highly offensive, complaining about improper selection into EA is different. ]
The reason that for that experience is because I don’t really think about you at all.
There’s basically billions of people on Earth that could be EAs, and the idea that this process selected and funded your kind instead of others is more troubling.
I will take a bet like “found guilty for X/paid a fine of X”, which are actual events that happen.
OK whatevs, which side of 50⁄50 do you want? And by what date? (and for that matter what X? Fraud???)
That said I really dunno why you don’t like “FTX used user funds to make risky investments” or “FTX speculated using user funds” etc. Is there nobody we might mutually trust to neutrally trust to resolve such a thing?
We seem to have very different ideas of what “operationalization” means...
How about “By April, will evidence come out that FTX gambled deposits rather than keeping it in reserves?” ? There’s already a literal prediction market up on that one!
We could do “SBF found guilty of literally anything / pays a fine of over 1M for literally any reason, by 2024” ? If that’s not operationalization I really have to give up here.
I do have a real name by the way!!
BTW I am assuming you are willing to bet in the thousands. If not, I really don’t consider that a bad thing, but lmk please!
I’ll announce here that I’ll take positive, will resolve affirmatively, 50⁄50 on both of those, under the protest that “gambling” actually means “any collateralization strategy that failed”.
I’ll announce, for 50⁄50, I’ll take positive, will result affirmatively on:
By April 2023, will evidence come out that FTX gambled deposits rather than keeping it in reserves?”,
Under the protest that “gambling” actually means “any collateralization strategy involving FTT that failed”.
For 50⁄50, I’ll take negative, will not resolve affirmatively on:
“SBF found guilty of literally anything / pays a fine of over 1M for literally any reason, by Jan 1, 2024”.
As explained in my top level comment, this is sort of not very interesting.
(As mentioned, starting the “prediction market thing”). As a deeper comment, this shows the defect of prediction markets itself—that this truly adds value in limited ways, that is abusable and culture dependent, often making itself redundant, especially if competent discourse is available. This directs arguments, theories, discourse and through limited channels that are stilted and performative, in a general sense, inadequate sort of like how social media is.
Also, thanks for taking a position on both. We are on the same side of 50⁄50 for the “gambled deposits” question, though. I wish we could come up with something we disagree on that might also resolve sooner, I’ll think on it…
Maybe we disagree on just how big FTX’s financial hole is? Could we bet on “as of today, FTX liabilities—FTX liabilites >= 4bn”? I’d go positive on that one.
Dunno… Really can’t tell what you believe. You commented that folks are being too negative yet seem to also think that FTX “gambled” user deposits, which sounds pretty negative to me (though we can disagree about whether it was good to have done this). Oh wellz.
Maybe we disagree on just how big FTX’s financial hole is? Could we bet on “as of today, FTX liabilities—FTX liabilites >= 4bn”? I’d go positive on that one.
It’s hard to say, 4B is the ask but 8B was mentioned as a figure too. They could mean the ability to deploy some latent funds in some complex way. Honestly, this doesn’t seem that meaningful.
Dunno… Really can’t tell what you believe. You commented that folks are being too negative yet seem to also think that FTX “gambled” user deposits, which sounds pretty negative to me (though we can disagree about whether it was good to have done this). Oh wellz.
The crux here is what “collateralization” or “gambling”.
Boiled down, I believe that you can’t absolutely prevent all failures, not even real brokerages can.
Instead, you have a sliding scale of risk that has probabilities of failure, and none of these are truly zero risk unless you basically not have a business at all. Given this, it’s not clear to me that a failure indicates “gambling”.
A major consideration is that the norms of crypto are insane—like actually hard to communicate to normal people and sound normal. FTX’s main business is basically clients trading leveraged sh*t coins, which is absolutely crazy for 99.9% of people. Collateralizing with FTT was the issue, but it’s unclear if the current exchanges would survive a similar run on their tokens—should they shut down now? Are their CEOs guilty now?
As I type this, I think people think USDD is literally unpegging?
So hanging this on one person’s neck is pretty unfair if he just pushed the “risk slider” a bit farther than other people, in this surreal space, where “NFTs” were a primary product. There’s other issues that undermined him that aren’t his fault, but explaining this to EAs would just make everyone sad.
If that sounds like mumbo jumbo and insanity with extra steps, well it might be, but is actually how sort of how capitalism and finance actually work. This literally happened with Bear Sterns and caused the 2008 crash.
To “resolve” the above, and what is “true”, I think what is used here is “social constructionism”, like Foucault, as opposed to the “rationalist” “positivist” view.
Relevant to our bet, as I mentioned, I’m not sure how this is resolved or communicated by me or you winning money in a bet. Also, I’m pretty sure that the social/political/legal things are going to drive this far more than the actual “crime” or “not crime”. I’m sort of worried but I’ll go through with it.
What I think: I think that FTX was insolvent such that even if FTT price was steady, user funds were not fully backed. That is, they literally bet the money on a speculative investment and lost it, and this caused a multibillion dollar financial hole. It is also possible that some or all of the assets—liabilities deficit was caused by a hack that happened months ago that they did not report.
As far as I can tell, you don’t think this. Well, if you really don’t think that, and it turns out you were wrong, then I’d like you to update. I think probabilities are a good way to enforce that, that is my actual good-faith belief. Of course I’m also always looking for profitable trades.
Is there any bet you’d take, that doesn’t rely on a legal system (which I agree adds a lot of confounders, not to mention delay), on the above claim? Could we bet on “By April 2023, evidence arises that FTX user funds were not even 95% backed before Binance’s FTT selloff?” Or maybe we could bet on Nuno’s belief on the backing?
BTW your chart is USDD not USDC. Idk what USDD is.
Also I’ve now spent like wayyy too much time chatting about this on here. Making a bet would involve further chatting. So FYI the most likely outcome is that I wake up tomorrow and pretend it was all just a dream. Sorry to disappoint and thanks for indulging me a bit in the end.
What I think: I think that FTX was insolvent such that even if FTT price was steady, user funds were not fully backed.
Yes you are right, I disagree. I think this collapse happened because of the FTT “attack” (or honestly, huge vulnerability) and Alameda was forced to defend. Without this depletion, SBF or FTX could cover these funds in a routine sense and we wouldn’t hear about this.
That is, they literally bet the money on a speculative investment and lost it, and this caused a multibillion dollar financial hole. It is also possible that some or all of the assets—liabilities deficit was caused by a hack that happened months ago that they did not report.
This was very crisp and helpful, yes, you are correct, we definitely disagree here, I don’t think there was a major gaping hole like a major speculation or hack that was being concealed.
Is there any bet you’d take, that doesn’t rely on a legal system (which I agree adds a lot of confounders, not to mention delay), on the above claim? Could we bet on “By April 2023, evidence arises that FTX user funds were not even 95% backed before Binance’s FTT selloff?” Or maybe we could bet on Nuno’s belief on the backing?
Thank you for thinking about this! I agree with this bet! With the addition that includes any major selloff/attack on FTT (it’s possible Binance actually was in the minority of sales on this week’s events). I will accept this bet very happily at 50⁄50 that no such evidence will merge that is substantiated (e.g. not a rumor).
(This can still be hard to operationalize, because the forensics or seeing what happened can be difficult, especially if FTX is restructured in some way. E.g., it could have happened but we don’t hear about it. This is to your disadvantage.)
So FYI the most likely outcome is that I wake up tomorrow and pretend it was all just a dream. Sorry to disappoint and thanks for indulging me a bit in the end.
I will only accept bets on escrow, so we’re both clear that it’s active. I will honor any bets discussed, if you want, and you can leave it or not mention it again, if you don’t want to take them.
You are extremely thoughtful and helpful. Have a good night! Thank you and sorry again.
Wait...(the experience of actually putting real money seemed appalling and sort of scary, so I was looking through your profile to see if I would wiggle out of it.)
You’re Agrippa! The guy with very short timelines, is Berkeley adjacent and knows that cool DxE person.
No, I do care about you! I respect you quite a bit. I was wrong and I retract what I said before in at least a few comments, and I apologize for my behavior. I upvoted every comment in this chain of yours. Also, I’ll be happy to take any negative repercussions.
For the bet, I’ll do $500? Is that acceptable or do you want more? Can we give money to a trusted person, do you know of someone in real life?
Hey, just to be clear, note that “pays a fine” — this reads to me as SBF personally paying a fine versus FTX or Alameda, that’s quite a big difference IMO and that favors me. Also, Jan 1st 2024 I assume is the date.
You’re Agrippa! The guy with very short timelines, is Berkeley adjacent and knows that cool DxE person.
No, I do care about you! I respect you quite a bit. I was wrong and I retract what I said before in at least a few comments, and I apologize for my behavior. Also, I’ll be happy to take any negative repercussions.
😳 That’s nice of you, thanks.
I’m actually not a guy though I don’t take any offense to the assumption, given my username.
Maybe Nuno would escrow for us.
I’m probably down for $500, would need to talk to my partner about going much higher anyway. If you are in the US we might not need escrow since suing eachother is an option, if we went >5k that would be worth it.
Re SBF vs FTX/Alameda paying: Yeah I meant SBF personally. I agree it’s a big difference. Jan 1st is the date but I also don’t know how fast this stuff ever goes and researching it sounds annoying.
Given that you think it’s likely FTX “gambled” user funds I am really not sure we disagree on anything interesting to begin with :-[
Maybe you think it’s only 70% likely and I think it’s a lot more than that?
I’ll escrow with Nuno at any time, you can reach out to me by PM or Nuno can reach out to me.
Given that you think it’s likely FTX “gambled” user funds I am really not sure we disagree on anything interesting to begin with :-[
I think this is true, but sort of productive to clarify this.
Maybe you think it’s only 70% likely and I think it’s a lot more than that?
I’m >90% sure FTT was collateralized in a way that had “a major role” in FTX’s collapse, but like, I’m not sure exactly what that means in a causal way, and how severe it is in a moral sense. Financial engineering is complicated and I don’t know much about it.
Not wishing ill for people—particularly when harm (whether intentional or unintentional) occurs—is a central component of being compassionate. It is necessary to consider both those who have caused harm and those who are harmed, hence the phrasing of my original comment.
I share your sentiment, but I do think the choice of who to center in those messages matters. To use a sort of absurd example, if QUALY the lightbulb was caught robbing a bank, it would come across as tone deaf to say “I would like to emphasize my wishes of wellness and care for QUALY, their bank robber crew, and the many others impacted by this.”
There’s a lot we don’t know at this point. Was FTX’s downfall the result of unfortunate luck? poor judgement? bad practices? Especially without knowing more, I’d be wary of messages that center care for Sam and the FTX team over care for the retail investors and customers who may end up facing the worst hardship as a result of these events.
Maybe hold off on this sentiment until we know exactly what they were doing with customer funds? It could age quite badly.
I agree. It seems like FTX collapsed quickly after some truths about their financial situation were revealed. Not to put too fine a point on it, it may turn out that Sam is a con artist. I don’t doubt the sincerity of his commitment to EA causes, but it now seems plausible that, like a problem gambler trying to hide it from his family, the FTX execs piled up shady debts through self-dealing.
SBF has been a friend to EA, but blindly supporting friends while ignoring potential victims is not the kind of hard-nosed truth-seeking that EA values. I’d previously considered him a kind of hero but we may need to rethink that, depending on how things develop.
Also, if SBF is made out to be a con-man this has very bad effects for the perception of EA as well.
‘Made out’ sort of implies he isn’t, I think we should be neutral on that right now.
I just mean “found out to be”
Fair point, I suppose— if it turns out that FTX was doing something extremely dodgy/illegal, I might no longer endorse that sentiment. I appreciate the counterargument :)
That said, I still think it’s important to remember that SBF and his team are real people with real feelings. There are enough people screaming at them on Twitter already.
Extending some grace seems like a good place to start, even if it turns out that they made some less-than-optimal decisions
Overall, the negative speculation in this thread seems undue and too negative.
Without trying to make an affirmative statement about what happened at FTX or saying there wasn’t any other factors, the comments in this thread ignore the reality of leverage and risk management in brokerage trading (which is what FTX effectively was).
It can be completely true that no customer funds were invested or speculated, but that the fund as a whole can still collapse due to the mechanics/dependencies of leveraged trading.
For example, Robinhood, which no one believes was speculating with customer funds, had a huge crisis in Jan 2021, that needed billions of dollars of outside money. This was just due to customer leverage and moderately more instability in stock (and probably bad risk management).
https://www.cnbc.com/2021/02/03/why-investors-were-willing-to-write-robinhood-a-3-billion-check-during-the-gamestop-chaos-.html
Would you be open to stating some probabilities on this topic—for example, your probability that Sam gets convicted of fraud, is conclusively found out to have committed fraud, etcetera?
I ask because I’d potentially be interested in making some financial bets with you!
Yes, and no, can you operationalize some of the most interesting and relevant questions to you?
These might touch on:
Alameda Research
FTX
Legal acceptability of FTX’s collateralization strategy
The fully and honest true answer is sort of no.
I think legality is poorly posed or not well defined. This is hard to explain and I’m finding the current information environment on the EA forum, and really EA, exceptionally poor and this is disappointing and relevant, if elaborating contributes to the noise.
But basically, whether something is actually found illegal will depend on the administration, style of prosecutor, and political and social environment that could vary wildly, along with many other details. For evidence, see what happened to the 2008 financial crisis, where there was almost no criminal prosecution.
More importantly, the moral meaning of the activity versus what is found illegal can be unintuitive or misleading and this seems more important. I seriously distrust whether people here understand the moral meaning of these actions and I would find the aspects of a prediction to be sort of a predictable and distasteful spectacle.
Also, since I’ve never come close to this kind of activity in any sense, I don’t know much and I don’t care much about the actual relevant laws, especially things like jurisdiction e.g. significance of Bahama, which could be pivotal. (This by the way is one example where the meaning of this question is uninteresting.)
I again reiterate my strong belief in the character and decision making of SBF, which is counter to the would be “mood” right now.
The moderation team[1] believes that Charles He has violated a number of Forum norms in the thread below. Because of that and a pattern of previous violations (which led to 3 separate bans in the past — 1, 2, 3), we’re banning Charles He from the Forum for 6 months.
Our Forum norms say that we strongly discourage, and may delete, “unnecessary rudeness or offensiveness” and “behavior that interferes with good discourse” — these are the violations we see in the comments below. We appreciate that Charles has unendorsed some comments and excerpts, but we don’t think this resolves the issue. Moreover, because Charles has violated norms before (and been banned repeatedly), we’re expecting a higher standard of norm-following from Charles.
The norm violations in this thread include:
A serious insult to another user (which has been edited and unendorsed — the previous version was notably worse — but is still unacceptable). This is not appropriate for the Forum.
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As I mentioned before, it’s understandable to have strong feelings around this topic, but we expect Forum users to express themselves in a more productive way. Please try to assume good faith and be kind.
You can reach out to the moderation team at forum-moderation@effectivealtruism.org if you have concerns about this decision.
I’m posting this message, but it was written collaboratively by several moderators after a lot of discussion.
Can you just operationalize a few things yourself and attach numbers to them? That sounds easiest.
For example, your odds on whether SBF literally goes to prison within the next 4 years…
(Though I think there are better ways to operationalize)
If you can’t come up with a way to operationalize a prediction on this topic in any straightforwardly falsifiable way then that’s okay I guess, though kind of sad.
Hey, by “sad” are you implying an askance view that I am either being evasive or inadequate?
I think so because you initiated this and won’t provide details of the bets and the tone of other text this: “If you can’t come up with...straightforwardly falsifiable way .”
I would find that derogatory, especially based on my detailed elaboration above, e.g. making me ponder and bet on whether someone I don’t think should be hurt is hurt and forcing me to study the legal details and put up my money to do so.
Separately and additionally, I correctly suspect that asking me to put up the numbers give you a major advantage, and you are attempting to take advantage of perceived emotional errors, by literally taking my money.
The above is plausible, and well, remarkably hostile under the circumstances.
That seems sort of like the perfect example of why someone would object to a prediction market.
I don’t really want to open up the “prediction market” thing, but I will ruthlessly do so, if this is pressed.
If you don’t want to make a single quantifiable prediction on this topic, after making claims about other people’s predictions being “too negative”, yes I consider that both evasive and inadequate.
If you really believe people are being “too negative” in their speculation, I thought you might be willing to put your money where your mouth is in some way. If you’re not, then you’re not, but it’s got nothing to do with how well defined legality is, the moral meaning of illegality, etcetera.
Edit: I don’t actually really think that a social expectation of financial betting is a good norm (not that betting is bad, just that declining to financial bet is fine). Please interpret “putting your money where your mouth is” as referring to reputational stake from making a concrete prediction on fraud/malfeasance/etcetera.
I don’t really have much to say except pretty much copy and paste my reply, above and point out how wildly hostile this is. No, people are not expected to put up bets for their statements. You are perfectly able to dispute them using arguments.
This is despicable to try to weaponize this practice, partially with the motivation for financial gain, which we both know you are. Your initial comment is absolutely in bad faith.
Separately and additionally, yes, I am exactly willing to take bets once you put up numbers, exactly answering your challenge, which I do not have to do.
I think that putting up probabilities is and should be expected. I think that actual financial betting shouldn’t be expected but is certainly welcome.
If I was going to dispute the first thing I would do is ask for probabilities. It seems weird to try to argue with you about whether your predictions are wrong if I don’t even know what they are. For all I know we have the same predictions and just a different view of other posters’ predictions.
I literally explained why I don’t want to give probabilities. I like, literally spent my time writing out a good faith reply to you, assuming a good faith comment.
Since you actively disagree, and you actively want to make a bet on this, you are perfectly able to do the work to set probabilities and I can take them.
As we both know, the construction of the probabilities, is entirely distinct from willing to put up money for the beliefs.
No, don’t try to walk this back, you know what you did. Give the probabilities.
Because you so indicated how interested you are, please proceed by operationalizing this and putting up numbers. I will take bets on either side.
In one year we can make a thread that asks EA forum users to vote on whether they believe >90% odds that SBF fraudulently handled funds (that is, in a way that was directly contradictory to public representation of handling funds) in a way that costed FTX.com customers >1bn in losses.
If a majority of users (whose accounts existed since yesterday, to prevent shenanigans) vote yes, then the bet resolves YES. Otherwise NO.
Which side of 50⁄50 do you want?
Hey, no? Because EA forum votes is literally nothing no one cares about, and which I explicitly said in my top thread are bad, and you’re deliberating using this as a ploy to get me to refuse? How about 50⁄50 on an actual real world event?
Also, as mentioned, beginning the “prediction market thing”, can you tell me, like not as a real name thing, but do you have like an an account on a prediction market? Are you associated with the grantees on their prediction market projects?
The real world event would be “FTX committed fraud that caused >1bn loss of user funds”. But if it’s a bet somebody has to arbitrate the outcome, you know?
I just picked EA forum users as an arbitator since like, that’s the venue here. But if you have any other picks for arbitrator that would be fine. You can pick yourself but I’m not sure I’d agree to that bet. Likewise I assumed you wouldn’t go for it if I picked me. And if it’s the 2 of us well then we might tie.
> but do you have like an an account on a prediction market
Multiple
> Are you associated with the grantees on their prediction market projects?
I am not sure that I understand this question. I have myself recieved a grant to work on a prediction market project.
“FTX committed fraud that caused >1bn loss of user funds”
We, and really, every prediction person here, know that’s not an adequate operationalization.
You’ve been asked 4 times already to give an operationalization and number for me to take, which we both know you are fully able to do.
I suspect you are an FTX grantee. Since you are using EA money (well until you decide it’s not convenient to call it this) do you mind sharing who you are or what your project is?
I’m sorry but I really don’t understand why you think it’s not adequate. “Fraud” is quite well-defined, and “loss of user funds” is also quite well-defined.
I would offer odds on like, criminal prosecution results, but that will take such a long time to resolve that I don’t think it makes an attractive bet. As you point out there are also jurisdictional questions.
Is “SBF lied about the safety of user funds on FTX.com″ better to you?
“FTX used user funds to make risky investments”?
“SBF mislead users about the backing of their FTX.com accounts”?
“Such a long time”? One of your first comments suggested a 4 year term.
“lied” “fraud”, are inadequate because they are inflammatory , loaded terms, which you don’t expect me to agree on, and this feature is being used as a wedge, for rhetorical reasons. I will take a bet like “found guilty for X/paid a fine of X”, which are actual events that happen.
For the fifth time, you fail to give a concrete bet.
The real product of this interaction for you is not a bet, but a remarkably hostile attempt at aggression and embarrassing someone with different beliefs than you.This is what all your EA rhetoric really masks. It’s sad that Sam might have surrounded himself with people like you.Edit: Deleted part is bad and has malice.
As an aside it is surprising to me that I seem at all to you like the type of person Sam might have been surrounded with. I don’t think anyone remotely insider-y has ever even slightly felt that way about me.
[ EDITED: You probably downvoted me because my comment about this person sounded like something else that was highly offensive, complaining about improper selection into EA is different. ]
:-(
I will have to insist on trusted escrow for any bets between us...
The reason that for that experience is because I don’t really think about you at all.There’s basically billions of people on Earth that could be EAs, and the idea that this process selected and funded your kind instead of others is more troubling.Edit: This was a bad comment with malice.
OK whatevs, which side of 50⁄50 do you want? And by what date? (and for that matter what X? Fraud???)
That said I really dunno why you don’t like “FTX used user funds to make risky investments” or “FTX speculated using user funds” etc. Is there nobody we might mutually trust to neutrally trust to resolve such a thing?
You still haven’t given an operationalization and at this point, we both know why.
I’ll take a bet when Nuno or someone with a real name comes along.
We seem to have very different ideas of what “operationalization” means...
How about “By April, will evidence come out that FTX gambled deposits rather than keeping it in reserves?” ? There’s already a literal prediction market up on that one!
We could do “SBF found guilty of literally anything / pays a fine of over 1M for literally any reason, by 2024” ? If that’s not operationalization I really have to give up here.
I do have a real name by the way!!
BTW I am assuming you are willing to bet in the thousands. If not, I really don’t consider that a bad thing, but lmk please!
I’ll announce here that I’ll take positive, will resolve affirmatively, 50⁄50 on both of those, under the protest that “gambling” actually means “any collateralization strategy that failed”.I’ll announce, for 50⁄50, I’ll take positive, will result affirmatively on:
By April 2023, will evidence come out that FTX gambled deposits rather than keeping it in reserves?”,
Under the protest that “gambling” actually means “any collateralization strategy involving FTT that failed”.
For 50⁄50, I’ll take negative, will not resolve affirmatively on:
“SBF found guilty of literally anything / pays a fine of over 1M for literally any reason, by Jan 1, 2024”.
As explained in my top level comment, this is sort of not very interesting.
(As mentioned, starting the “prediction market thing”). As a deeper comment, this shows the defect of prediction markets itself—that this truly adds value in limited ways, that is abusable and culture dependent, often making itself redundant, especially if competent discourse is available. This directs arguments, theories, discourse and through limited channels that are stilted and performative, in a general sense, inadequate sort of like how social media is.
Cool, what size bet? And, after we figure that out, any thoughts on an escrow?
Also, thanks for taking a position on both. We are on the same side of 50⁄50 for the “gambled deposits” question, though. I wish we could come up with something we disagree on that might also resolve sooner, I’ll think on it…
Maybe we disagree on just how big FTX’s financial hole is? Could we bet on “as of today, FTX liabilities—FTX liabilites >= 4bn”? I’d go positive on that one.
Dunno… Really can’t tell what you believe. You commented that folks are being too negative yet seem to also think that FTX “gambled” user deposits, which sounds pretty negative to me (though we can disagree about whether it was good to have done this). Oh wellz.
It’s hard to say, 4B is the ask but 8B was mentioned as a figure too. They could mean the ability to deploy some latent funds in some complex way. Honestly, this doesn’t seem that meaningful.
The crux here is what “collateralization” or “gambling”.
Boiled down, I believe that you can’t absolutely prevent all failures, not even real brokerages can.
Instead, you have a sliding scale of risk that has probabilities of failure, and none of these are truly zero risk unless you basically not have a business at all. Given this, it’s not clear to me that a failure indicates “gambling”.
A major consideration is that the norms of crypto are insane—like actually hard to communicate to normal people and sound normal. FTX’s main business is basically clients trading leveraged sh*t coins, which is absolutely crazy for 99.9% of people. Collateralizing with FTT was the issue, but it’s unclear if the current exchanges would survive a similar run on their tokens—should they shut down now? Are their CEOs guilty now?
People literally believed Tether might unpeg several in the last year, which is crazy, like thinking the USD might crash. It’s still a mystery how the main fiat instrument in crypto has value.
As I type this, I think people think USDD is literally unpegging?
So hanging this on one person’s neck is pretty unfair if he just pushed the “risk slider” a bit farther than other people, in this surreal space, where “NFTs” were a primary product. There’s other issues that undermined him that aren’t his fault, but explaining this to EAs would just make everyone sad.
If that sounds like mumbo jumbo and insanity with extra steps, well it might be, but is actually how sort of how capitalism and finance actually work. This literally happened with Bear Sterns and caused the 2008 crash.
To “resolve” the above, and what is “true”, I think what is used here is “social constructionism”, like Foucault, as opposed to the “rationalist” “positivist” view.
Relevant to our bet, as I mentioned, I’m not sure how this is resolved or communicated by me or you winning money in a bet. Also, I’m pretty sure that the social/political/legal things are going to drive this far more than the actual “crime” or “not crime”. I’m sort of worried but I’ll go through with it.
What I think: I think that FTX was insolvent such that even if FTT price was steady, user funds were not fully backed. That is, they literally bet the money on a speculative investment and lost it, and this caused a multibillion dollar financial hole. It is also possible that some or all of the assets—liabilities deficit was caused by a hack that happened months ago that they did not report.
As far as I can tell, you don’t think this. Well, if you really don’t think that, and it turns out you were wrong, then I’d like you to update. I think probabilities are a good way to enforce that, that is my actual good-faith belief. Of course I’m also always looking for profitable trades.
Is there any bet you’d take, that doesn’t rely on a legal system (which I agree adds a lot of confounders, not to mention delay), on the above claim? Could we bet on “By April 2023, evidence arises that FTX user funds were not even 95% backed before Binance’s FTT selloff?” Or maybe we could bet on Nuno’s belief on the backing?
BTW your chart is USDD not USDC. Idk what USDD is.
Also I’ve now spent like wayyy too much time chatting about this on here. Making a bet would involve further chatting. So FYI the most likely outcome is that I wake up tomorrow and pretend it was all just a dream. Sorry to disappoint and thanks for indulging me a bit in the end.
Yes you are right, I disagree. I think this collapse happened because of the FTT “attack” (or honestly, huge vulnerability) and Alameda was forced to defend. Without this depletion, SBF or FTX could cover these funds in a routine sense and we wouldn’t hear about this.
This was very crisp and helpful, yes, you are correct, we definitely disagree here, I don’t think there was a major gaping hole like a major speculation or hack that was being concealed.
Thank you for thinking about this! I agree with this bet! With the addition that includes any major selloff/attack on FTT (it’s possible Binance actually was in the minority of sales on this week’s events). I will accept this bet very happily at 50⁄50 that no such evidence will merge that is substantiated (e.g. not a rumor).
(This can still be hard to operationalize, because the forensics or seeing what happened can be difficult, especially if FTX is restructured in some way. E.g., it could have happened but we don’t hear about it. This is to your disadvantage.)
I will only accept bets on escrow, so we’re both clear that it’s active. I will honor any bets discussed, if you want, and you can leave it or not mention it again, if you don’t want to take them.
You are extremely thoughtful and helpful. Have a good night! Thank you and sorry again.
Wait...(the experience of actually putting real money seemed appalling and sort of scary, so I was looking through your profile to see if I would wiggle out of it.)
You’re Agrippa! The guy with very short timelines, is Berkeley adjacent and knows that cool DxE person.
No, I do care about you! I respect you quite a bit. I was wrong and I retract what I said before in at least a few comments, and I apologize for my behavior. I upvoted every comment in this chain of yours. Also, I’ll be happy to take any negative repercussions.
For the bet, I’ll do $500? Is that acceptable or do you want more? Can we give money to a trusted person, do you know of someone in real life?
Hey, just to be clear, note that “pays a fine” — this reads to me as SBF personally paying a fine versus FTX or Alameda, that’s quite a big difference IMO and that favors me. Also, Jan 1st 2024 I assume is the date.
😳 That’s nice of you, thanks.
I’m actually not a guy though I don’t take any offense to the assumption, given my username.
Maybe Nuno would escrow for us.
I’m probably down for $500, would need to talk to my partner about going much higher anyway. If you are in the US we might not need escrow since suing eachother is an option, if we went >5k that would be worth it.
Re SBF vs FTX/Alameda paying: Yeah I meant SBF personally. I agree it’s a big difference. Jan 1st is the date but I also don’t know how fast this stuff ever goes and researching it sounds annoying.
Given that you think it’s likely FTX “gambled” user funds I am really not sure we disagree on anything interesting to begin with :-[
Maybe you think it’s only 70% likely and I think it’s a lot more than that?
I’ll escrow with Nuno at any time, you can reach out to me by PM or Nuno can reach out to me.
I think this is true, but sort of productive to clarify this.
I’m >90% sure FTT was collateralized in a way that had “a major role” in FTX’s collapse, but like, I’m not sure exactly what that means in a causal way, and how severe it is in a moral sense. Financial engineering is complicated and I don’t know much about it.
Robinhood allowed leverage, but I don’t think that had anything to do with the crisis.
Not wishing ill for people—particularly when harm (whether intentional or unintentional) occurs—is a central component of being compassionate. It is necessary to consider both those who have caused harm and those who are harmed, hence the phrasing of my original comment.
I share your sentiment, but I do think the choice of who to center in those messages matters. To use a sort of absurd example, if QUALY the lightbulb was caught robbing a bank, it would come across as tone deaf to say “I would like to emphasize my wishes of wellness and care for QUALY, their bank robber crew, and the many others impacted by this.”
There’s a lot we don’t know at this point. Was FTX’s downfall the result of unfortunate luck? poor judgement? bad practices? Especially without knowing more, I’d be wary of messages that center care for Sam and the FTX team over care for the retail investors and customers who may end up facing the worst hardship as a result of these events.
I agree that who we center matters. Thanks for the feedback! It helped me to clarify the original message.