Tom Brady. Gisele Bundchen. Steph Curry. David Ortiz. Shohei Ohtani. Larry David. Kevin O'Leary of Shark Tank fame. Shaq O'Neal.
I thought Matt Damon was on the list but, no, his crypto endorsement was for crypto.com. They're deemed one of the safer/better crypto exchanges, but would you really trust any of them?
Anyway, the celeb list headlined by TB12 was, unfortunately, all in for FTX, the now bankrupt crypto outfit.
You have to be a real maroon to take investment advice from a celebrity, just because they know how to throw a football, walk the runway, sink a three-pointer, or tell a deadpan joke. But I'm sure some people saw the ads where all these big names talked about what a good bet FTX is, and decided they wanted in.
Hah!
Except to raise an occasional skeptical eye toward the entire crypto thang, I haven't paid all that much attention to the spectacular downfall of FTX and its founder and leader, Sam Bankman-Fried. Still, I found the recent news pretty interesting.
At least $8 billion in customer funds are missing, reportedly used to backstop billions in losses at Alameda Research, the hedge fund he also founded. Both of his companies are now bankrupt with billions of dollars worth of debt on the books. The CEO tapped to take over, John Ray III, said that “in his 40 years of legal and restructuring experience,” he had never seen “such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.” This is the same Ray who presided over Enron’s liquidation in the 2000s. (Source: CNBC)
Enron, you say? Whoo boy. (Ever wonder why we have regulations?)
And speaking of boys, I give you Sam Bankman-Fried. Boy genius. Pitchman extraordinaire. Proud wearer of the brass rat (i.e., MIT grad). Major donor to Democratic candidates. "Effective altruist" (i.e., someone who wants his charitable donations to get results). Erstwhile multi-billionaire - "worth" over $20 billion just last month, and now reporting net wealth of about $100K, Oh, how the mighty rich boys have fallen.
Sorry (the Democrats don't have all that many donors of the Sam Bankman-Fried magnitude)/Not Sorry (everything else) to see the downfall of this crew.
When Bankman-Fried was on his crypto roll, he was apparently quite happy to position himself as a wunderkind who was making big bucks - or the crypto equivalent of big bucks; big bitcoin? - for himself and for others. Now he's changing his tune a bit.
In America, it is not a crime to be a lousy or careless CEO with poor judgement. During his recent press tour from a remote location in the Bahamas, Bankman-Fried really leaned into his own ineptitude, largely blaming FTX’s collapse on poor risk management.
At least a dozen times in a conversation with Andrew Ross Sorkin, he appeared to deflect blame to Caroline Ellison, his counterpart (and one-time girlfriend) at Alameda. He says didn’t know how extremely leveraged Alameda was, and that he just didn’t know about a lot of things going on at his vast empire.
Bankman-Fried admitted he had a “bad month,” but denied committing fraud at his crypto exchange.
"Bad month?" That's putting it mildly. Pretty bad month for his investors, too, no?
It's not yet clear what, if anything, Bankman-Fried will be charged with. He's apparently preparing to mount a "bad businessman" legal strategy to excuse him from any culpability. But if it can be demonstrated that he deliberately misled investors, he could end up doing time. (Both of his parents are professors at Stanford Law, so he should have access to decent - if maybe a bit too academic - legal advice.)
“It sure looks like there’s a chargeable fraud case here,” said [former federal prosecutor and trial lawyer Renato] Mariotti. “If I represented Mr. Bankman-Fried, I would tell him he should be very concerned about prison time. That it should be an overriding concern for him.”
Bankman-Fried claims that he's not all that concerned. In his interview with Andrew Ross Sorkin, when asked about whether he was worried about any legal exposure, he responded:
“I don’t think that — obviously, I don’t personally think that I have — I think the real answer is it’s not — it sounds weird to say it, but I think the real answer is it’s not what I’m focusing on,” Bankman-Fried told Sorkin. “It’s — there’s going to be a time and a place for me to think about myself and my own future. But I don’t think this is it.”
Maybe he'll end up in hot water, criminally. Maybe he'll end up in hot water, civilly. Maybe he'll end up in hot water for both.
But if I were Sam Bankman-Fried, I'm pretty sure I'd be thinking about myself and my future, and worrying about whether it might involve an orange jumpsuit and bars.
Sad to see young guy - Bankman-Fried is just thirty - who got so caught up in belief in his genius, who had all the hubris in the world, and who was pretty feckless when it came to running his show, that he could end up in prison for a good long time.
But who knows? F. Scott Fitzgerald famously wrote that "there are no second acts in American lives," but I don't believe that for a crypto minute.
Maybe he'll end up in the same prison as Elizabeth Holmes of Theranos infamy. Maybe they'll put their heads together and cook up an idea that's actually workable and doesn't require fakery and BS to "succeed."
Maybe something that Tom Brady, Gisele Bundchen, et al. can lend their names to without ending up looking like fools.
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