from Hacker News

Where did FTX customer money go? Firm says Bankman-Fried took $2.2B

by moh_maya on 3/16/23, 5:35 PM with 59 comments

• by Shank on 3/16/23, 6:08 PM

  > The other payment and loan totals described by FTX yesterday were $587 million to Nishad Singh, $246 million to Zixiao "Gary" Wang, $87 million to Ryan Salame, $25 million to John Samuel Trabucco, and $6 million to Caroline Ellison. Singh, Wang, and Ellison have pleaded guilty to criminal fraud charges and are cooperating with government prosecutors.

  SBF running off with $2.2B really makes Caroline's $6m look quaint. I mean, why even go after her for (relative) pennies? The compensation gap between SBF and his underlings just goes to show you that wealth inequality exists even in corrupt organizations. Her charges will be far less, but it goes to show you that even in crime you're being stiffed unless you're at the absolute top of the food chain.

• by misiti3780 on 3/16/23, 6:23 PM

  I cant wait to see his sentence. He's going away for decades.

• by churchill on 3/16/23, 7:33 PM

  Has anyone else noticed that Sam Trabucco managed to run off without a trace? No one even mentions him much. He was Alameda's former CEO & he resigned just days before FTX collapsed

• by phoenixreader on 3/17/23, 2:53 PM

  How can SBF ever be convicted now? Even if he spends just 10% of that in legal fees (220m), he will be able to have a legal team no government can match. He can afford to have countless mock trials and to approach countless expert witnesses before finding one that aligns with him (e.g. an expert that portrays him as ignorant rather than criminal). And these are just the legal methods to obstruct justice with 2.2B. If he is willing to stray to the illegal side, he can also just straight up pay people an unspeakable sum to testify for him. Perjury only has a sentence of several years.

  Heck, he can even offer to return or donate the 2.2B (assuming only he knows where it is) in exchange of a lighter sentence. Will any government refuse that offer? 2.2B is the wage of thousands of people for 10 years.

  No one with a personal wealth of more than 2B at the time of arrest has ever served a single day in jail in the United States. People only go to jail if they have lost their billions.

• by carbonatedmilk on 3/17/23, 7:41 AM

  This just keeps getting weirder.

  From the infamous irony quotes 'balance sheet': https://d1e00ek4ebabms.cloudfront.net/production/7ab64a3b-6c...

  Liablities: $8.8bn of customer deposits

  * $6.6bn-ish in USD or USDT

  * $2.2bn in crypto

  * I'm assuming the 'poorly labelled $8bn' is included in this amount, and you don't add it

  Assets: $2.5bn?

  * $1.5bn of liquid assets.

  * $1bn-ish? of illiquid assets.

  * Most of these numbers are just made up, but let's finger-in-the-wind them at $1bn ($500m at least is in 'locked USDT')

  Now we find out they have another magical pool of money, the $3.2bn that they'd taken out of FTX and put in their pockets.

  So the position looks really different: They had $8.8bn on one side of the ledger, and $5.7bn on the other side - After the massive bank run which collapsed the price of their shitcoins.

  It appears they had the money to pay out most of their USD / USDT depositors at $0.85 on the dollar, which is obviously still 'insolvent', but possibly enough to survive a bank run (almost) all the way down to the ground (If you suspend redemptions of your crypto and persuade 15% of your USD depositors not to pull their money out)

  The final question is: Who did they owe the liabilities to? If some of those 'deposits' were actually owed to other FTX-associated entities, it seems even more survivable, and would probably have preserved some of the value of their shitcoins

• by ilrwbwrkhv on 3/16/23, 6:06 PM

  Sequoia has the rest.

• by rocket_surgeron on 3/16/23, 6:08 PM

  We are very lucky that cryptobros are arrogant to the point of having a god complex.

  In surgeons it means they have the confidence to perform some of the most difficult tasks a human being can undertake and is a net positive even though it makes them difficult to be around.

  With cryptobros it makes them easier to catch after their schemes inevitably blow up because in their arrogance they refuse to consider than anyone could ever be smart enough to catch on to them.