Inside FTX: Jokes about misplaced funds, diabolical IT, poor oversight, and worse

The liquidators picking over the remains of FTX have released their first formal report into Sam Bankman-Fried's imploded empire – and it somehow appears things are worse than feared. The 39-page dossier [PDF] details an organization with little to no oversight of its own operations, and leadership that stifled dissent, …

[elDog]

Unfortunately, all of the funds I stored with FTX were worthless

I did have over 1,000 BTC at one point. I leveraged that to multiples of other coinbase and items. Ethererum was a good staging for some of these transfers.

I sent an encrypted USB drive to FTX with probably $100,000,000++ of digital coins. They did give me a digital receipt. But since then I have heard nothing and cannot access my gold.

Dear Amy - Am I screwed?

[Natalie Gritpants Jr]

Re: Unfortunately, all of the funds I stored with FTX were worthless

Yes.

Kind regards,

Amy.

[Michael Hoffmann]

"such is life"

There was another famous guy who was hanged after uttering those words.

It's becoming quite clear why US prosecutors are letting SBF roam about and shoot his mouth off. They can just dump a truck-load of "quotes by SBF" in front of the judge and jury and head off to lunch.

They seem to be following the Lord Vetinari method of "if you just keep silent, some dolt will want to fill that silence and tell you way more than they wanted to".

[chuckufarley]

This is when...

...People need to ask is it really Caveat Emptor or Cave Praesidem?

There were signs and signals and bribes and brides. Sounds like Ancient Rome, but not in a good way.

[Jim Mitchell]

Re: This is when...

"Cave praesidem"? What guards? Are you referring to the regulators and oversight that FTX "management" worked to avoid? Or to FTX management themselves, who while guarding the hen house, ate as many hens as possible?

Either way, caveat emptor applies.

[deadlockvictim]

Re: This is when...

Chuckufarley» "There were signs and signals and bribes and brides"

That's a great line. Did you plagiarise it or it all yours?

[Jonathan Richards 1]

Great lines

Oscar Wilde: I wish I had said that...

[chuckufarley]

Re: This is when...

Coined by me. However:

"If I have seen further it is by standing on the shoulders of Giants." - Sir Isaac Newton

[GBE]

I wish I were shocked.

I don't think anybody who's been even half-awake for the past few years is at all surprised by any of this.

Disgusted, yes. Surprised, no.

It all seems pretty par for the course when it comes to "crypto" business practices, though I must admit SBF and company did manage to do an exemplary job of it.

Big Jim McBob and Billy Sol Hurok would have been proud: "It blowed up _reeeaal_ good!"

[Mike 137]

Re: I wish I were shocked.

'It all seems pretty par for the course when it comes to "crypto" business practices'

This is probably just the visible tip of a very large iceberg affecting much more than just cryptocurrency exchanges. In my consulting experience, very few client organisations of any kind have actually followed their documented policies, which typically exist to satisfy periodic audits and as bludgeons with which to punish scapegoats to cover corporate embarrassment when things go pear shaped. Indeed, many policies I've examined have been impossible to follow, being ambiguous, inaccurate or even in some cases self contradictory. This is itself, however, part of a much wider picture. "Compliance" is commonly seen, not as a tool to ensure conformity with good practice, but as a burden to be sidestepped as far as possible. Most businesses would probably prefer to operate entirely without governance or regulatory supervision, as wheeling and dealing can be very profitable and accountability gets in the way.

[vcragain]

Re: I wish I were shocked.

Watching my sons do battle with their tiny business & all the OSHA regulations they have to follow, it makes me wonder why anybody bothers to try & be in business in the first place - not me, I was a happy employee of a medium sized company. and had not one jot of envy at anybody earning more than me ! I rose up via hard work which was comical to me since I was enjoying myself ! I think attitude is everything in the work place, but all the regulations make life extremely difficult. I can quite understand why large corps would choose to pay fines rather than be bothered with it all - but the little people go out of business thru those fines !

[swm]

Money

"$50m here, $50m there, pretty soon you're talking real money."

I think the real quote by Sam Rayburn (speaker of the house) was: "A billion hear, a billion there, and pretty soon you're talking real money."

[david 12]

Re: Money

The real quote was from George Washington. I've seen the clip on YouTube.

[Anonymous Coward]

Re: Money

More accurately, "A billion in crypto currency here, a billion there, none of it is real money...."

[Winkypop]

ipso facto crypto crapto

Surely the whole industry is one big joke.

It certainly seems the management thought so too.

[Anonymous Coward]

We seemed to have misplaced your magic beans

Kleptocurrency indeed.

[Norfolk N Chance]

Priorities, priorities...

'FTX Group also lacked any enterprise resource planning software, instead relying on QuickBooks and "a hodgepodge of Google documents, Slack communications, shared drives, and Excel spreadsheets and other non-enterprise solutions to manage their assets and liabilities."'

"Lacked"? Pretty sure in fact that the aforementioned *is* the gold standard stack of today's ERP for Startups.

Only when the tide goes out do you learn who has been swimming naked - only this time we're talking about leveraged IT rather than money.

Perhaps it's the same thing!

[Anonymous Coward]

As the self help Singh would say

Fuck crypto.

[Howard Sway]

stored in a mix of over one thousand [AWS] servers and related system architecture

That must be why it collapsed so quickly - imagine the monthly cloud bill, not even a ponzi scheme could sustain that. It's kind of funny that the crypto money wasting scam must have been crippled by the cloud money wasting scam, but not as funny as the fact that this bunch of bozos were so clueless as to have provisioned over a thousand servers to do whatever work they were doing in between beach parties.

[Maximus Decimus Meridius]

Re: stored in a mix of over one thousand [AWS] servers and related system architecture

Maybe they had scripts to spin up the server every morning and stop it at night, but the night script didn't stop it and the morning script created a new server each time?

[DS999]

Really the perfect setup

If you want to steal a lot of money while making it impossible to trace or even figure out who to blame.

[John Brown (no body)]

Re: Really the perfect setup

I wonder if they started with the intention of screwing up so badly, ie had malice aforethought, or is this just a bunch of frat boys who's business surprisingly took off and they not only had no idea how to run a real business, but didn't even realise they didn't have the skills or knowledge to do it. On the other hand, it did become clear to them eventually, when they started trying to hide stuff from people who actually did know how things are supposed to work.