:

Sure, he was convicted of fraud and conspiracy, but high-profile people from every industry have stolen money and pulled-down the house of cards around them.

I would have stopped thinking about SBF by now if he hadn’t been in crypto – but he was, so I can’t stay silent.

His failure was a failure of values because he misunderstood the reason why Bitcoin and most of crypto exists. If too many of us in crypto make the same mistakes, all of us are in trouble.

When the motivation for people running a crypto business becomes only about making themselves money, I have a problem.

I have a problem because even the governments printing money understand it would be a pointless exercise to just store it all until its value increases.

Fiat has to have some utility, otherwise it’s just paper. Many in crypto despise fiat currency, yet they talk about crypto as if it’s almost the same thing. They treat it only as an investment and forget its utility.

When I first understood the real power of Bitcoin, I knew that making myself successful was only the tip of a very big iceberg.

In my early days building a crypto company, I was offered a lot of money to sell it. I could have taken the money and lived a luxurious life, but I chose not to. I’ve always believed that crypto has the potential to change the world for the better, and I wanted to be a part of that.

I was born in Egypt , but I grew up in a nasty part of New York City called Hell’s Kitchen. It’s a different place now, but in the 80s and 90s it was pretty scary.

When I was a kid helping my parents run a newsstand in Hell’s Kitchen, times were tough, and we weren’t just battling to put food on the table. We were fighting to survive.

I saw a lot of people struggling, a lot of antisocial behaviour, and I now realize that many of the problems were caused by people having to fight tooth-and-nail to get a piece of the action.

Some wanted money for drugs, but many just wanted to pay the rent or put food on the table. It wasn’t a nice place to visit, let alone to live, work, and go to school.

My experiences in the Global South paralleled those early years in Hell’s Kitchen, and they taught me that we have to give people a place at the table. We have to give them some food, and that’s one of our values at NoOnes – “everyone eats.”

Part of our strategy is to give back 50% of our profits to the people, and we have already started to do it.

Our initiatives like cashbacks, including paying $50 to students learning how to buy Bitcoin and payouts to traders using our partner program, are already having an impact. “Everyone eats” is key because my success won’t be complete until those around me thrive, too.

SBF talked about “effective altruism” and said he donated money to the “Future Fund,” but I’m not aware of anything he built. He signed the “Giving Pledge” a few years ago, but the value of that is now exactly zero. Unlike effective altruism, I decided a long time ago that giving back had to be part of my business model. I wasn’t going to make a lot of money and then decide where to donate it.

While at Paxful, I created Built with Bitcoin and helped build 13 schools and other infrastructure in the Global South. Now, I’m taking it to the next level with NoOnes nation and the ecosystem we are building.

Some people might think I’m wasting my time and money, but it’s a business decision as much as it is an ethical one.

Satoshi thought of Bitcoin as a universal container for money that could be part of a new financial architecture. It was never meant to be just another form of investment.

Originally, when I built Paxful, it was in response to my “bullish education” – another of my core values. This belief fueled my conviction that Bitcoin and peer-to-peer technology were part of the solution to the problems with the traditional financial system.

But after witnessing the challenges faced by communities on the ground, particularly in Africa, I came to understand that these tools alone weren’t enough. We needed more than that.

In the U.S., I tried to find solutions for the problems in the Global South, but I realized I had to leave if I wanted to build what was needed. I resigned from my role  and did the only thing I could do – I went home to the Global South and built the right “nation” here. That nation is NoOnes, and one of the keys to it succeeding is another core value – “revolutionary transparency.”

Revolutionary transparency, in essence, is flipping information availability on its head. I knew what I had to do when I created NoOnes because I listened to the savvy, African bitcoiners telling me their problems, and then I used that information to improve our product.

Every day we take their feedback and make our peer-to-peer marketplace better. But it won’t work if the people on the ground don’t know what’s going on – and that’s why transparency is crucial.

The transparency they talk about in the West is not revolutionary. What I’m talking about is being completely open, and that means, for example, showing anyone – not just our employees or the users of our marketplace – the CEO dashboard. Anyone can click on the link and see what I see right now. Imagine if we could see what SBF was seeing a year before the collapse of FTX?

If we are going to build a real financial ecosystem that is fair to everyone, regardless of where they were born or what passports they have, we must have the trust of the people we are building it for.

We can only gain that trust if we are completely transparent, and that’s a revolutionary idea because the people in crypto like Sam Bankman-Fried, who talk about transparency but never follow-through, hurt all of us.

The people who know me will recognize my values because I’ve been talking about them and acting upon them for years.

Apart from Built with Bitcoin and all the schools, water wells, and education centers I helped build, I co-authored the white paper for a censorship-resistant, global, peer-to-peer marketplace blueprint called CivKit. It’s open source because we need others to build their own NoOnes to help us create this new financial ecosystem that uses Bitcoin and peer-to-peer to set our money free from the prisons in the Global South that keep it locked away.

We need competitors building their own ecosystems on CivKit, or joining our NoOnes community to advocate for financial freedom in the Global South.

We need people with the right values who are willing to learn the truth about the fight we are up against and how we can build a better future for everyone.

If we want to make Bitcoin or any crypto work as it was intended, everyone has to eat, they have to be educated, and they have to trust us. We need more NoOnes nations and less FTXes if we are going to see this project through to the end.

Zhao pleaded guilty to money laundering charges, in the most high-profile crypto case since Sam Bankman-Fried was jailed.

Changpeng Zhao, a Canadian, resigned from his post at the world’s largest cryptocurrency exchange platform late last year as part of a deal with US authorities.

According to investigations by two Treasury agencies, Binance failed to prevent transactions by movements such as the Islamic State group, al-Qaeda or the armed wing of Hamas.

Zhao pleaded guilty to violating US anti-money laundering laws and Binance agreed in February to pay $4.3 billion to settle charges.

Prosecutors had asked the judge to impose three years behind bars for a crime that typically results in probation, according to a court filing.

“He made a business decision that violating US law was the best way to attract users, build his company, and line his pockets,” Justice Department lawyers said of Zhao in a sentencing memorandum.

“The sentence in this case will not just send a message to Zhao but also to the world.”

Attorneys for Zhao countered in a filing that being punished with probation is just, appropriate, and in line with legal precedent.

They cited Zhao’s acceptance of responsibility along with what they called his philanthropic track record.

“I made mistakes, and I must take responsibility,” Zhao, who lives in the United Arab Emirates, said in a post on X, formerly Twitter, in November.

Binance was created in 2017 and cornered much of the crypto-trading market, turning its founder and chief executive Zhao into a billionaire.

While Binance was founded in China, Zhao moved its operations to other locations internationally after a crackdown on the crypto sector by Beijing.

Binance runs crypto exchanges and provides other services around the world, but it took a severe hit when crypto markets collapsed and regulators began probing the legality of its business.

The volatile industry surged in 2021, with a range of complex products and celebrity endorsements propelling it to a valuation in excess of $3 trillion in 2022.

But a series of scandals, including the November 2022 collapse of Binance’s main rival exchange, FTX, and criminal charges for several industry executives, saw public confidence evaporate and investors pull their money out of crypto.

FTX founder Bankman-Fried was given a 25-year jail term in March.

The crypto industry has bounced back in recent months, thanks in large part to US regulators giving the go-ahead for exchange traded funds (ETFs) in bitcoin which allow investors to trade the asset without actually opening a crypto account.

Binance’s new CEO Richard Teng told AFP this month that the company spent hundreds of millions of dollars on compliance and was working very closely with regulators.

[Source: AFP] [Featured Image Credit]

“It is imperative that you attend our hearing on the 13th, and we are willing to schedule continued hearings if there is more information to be shared later,” Representative Maxine Waters, the committee chair, wrote on Twitter.

On Sunday, Bankman-Fried tweeted that he would testify before the committee after he finished “learning and reviewing” the events that led to the spectacular collapse of his cryptocurrency exchange.

In the tweet Bankman-Fried said he was unsure if that would happen before Dec. 13.

But in her reply on Monday, Waters wrote on Twitter: “Based on your role as CEO and your media interviews over the past few weeks, it’s clear to us that the information you have thus far is sufficient for testimony.”

.@SBF_FTX, we appreciate that you've been candid in your discussions about what happened at #FTX. Your willingness to talk to the public will help the company's customers, investors, and others. To that end, we would welcome your participation in our hearing on the 13th.

— Maxine Waters (@RepMaxineWaters) December 2, 2022

Rep. Waters, and the House Committee on Financial Services:

Once I have finished learning and reviewing what happened, I would feel like it was my duty to appear before the committee and explain.

I'm not sure that will happen by the 13th. But when it does, I will testify. https://t.co/c0P8yKlyQt

— SBF (@SBF_FTX) December 4, 2022

Bankman-Fried rejected any suggestion of fraud in a series of interviews last week after his company’s collapse stunned investors and left creditors facing losses totaling billions of dollars.

FTX filed for bankruptcy in November after a week in which a possible merger with rival crypto exchange Binance failed.

The following is the content of the interview :

Explosive head otaku + white knight

“Fortune” described SBF as a friendly, rambunctious, explosive otaku interested in LOL (League of Legends) and fidget spinners. The above characteristics make him look nothing like the most powerful person in the crypto industry. However, under the appearance of an otaku, SBF founded the most successful quantitative trading company Alameda Research and crypto derivatives trading platform FTX.

In addition to being a crypto billionaire (worth about $11.5 billion), SBF has recently acquired a new identity: the white knight of the crypto industry, rescuing some crypto startups from liquidation.

Liquidation is positive; BTC could fall further

SBF admitted that although the bear market was predicted, it did not expect to be liquidated on a large scale, nor did it expect it to be so bad. Nonetheless, he believes two-thirds of the crypto market has fallen so much because of the global economy, and the other third is a problem with the crypto market itself.

“The worst is over, of course; there may be other liquidations, but not as bad as before. I think this bear market is a healthy reshuffle for the crypto industry. People may rethink asset valuations. It will also become more down-to-earth.”

While it feels the worst is over, SBF sees the overall economy as the more significant variable.

He estimated that if the Nasdaq fell 25% and the Federal Reserve raised interest rates to 7%, the world could experience a recession of about two-and-a-half years.

If it does happen, Bitcoin could drop even further. Also, there could be a new round of liquidations.

Greedy when others are fearful?

As we all know, SBF has recently invested in many troubled companies, such as BlockFi and Voyager Digital. For these investments, Fortune believes this is the practice of Warren Buffett’s famous saying: I am greedy when others are fearful.

SBF also explained his strategy for acquiring shares.

The first consideration is whether the users of those companies can get their assets back and whether the transaction can prevent serial liquidations. The last question is whether FTX can have some “good feedback” in these transactions.

“Our job isn’t to make amazing acquisitions, the logic here is to make some reasonable deals, even ones that are kind of bad but we can afford.”

An unnamed senior industry source told Fortune that SBF’s generosity had given him many things, including a lot of debt.

In addition to hoping that the future will be what the unnamed person said, SBF also explained the reason for being so generous: trust.

Lack of trust is a huge transaction cost, a lesson that SBF has learned when starting in business.

“A big part of that is trust.

In the past, when I was trading, I didn’t want to worry about whether the other party would play me behind my back in 20 ways that I didn’t expect. If there’s a lack of trust between the two sides, the deal won’t work, right? “

Therefore, SBF will set a standard in these acquisitions, cooperate reasonably, and show the other party that FTX does not want to make small moves behind the scenes.

“Think about things from a mutually beneficial perspective, and then we can start thinking about how to share the cake.”

Atypical crypto hero

The crypto community usually likes to embrace heroes like Satoshi Nakamoto or Changpeng Zhao, founder of Binance.

Although SBF seems to be becoming an object of worship in the crypto community, he has done some things that the hero of the currency circle (original Crypto bro) will not do, such as donating political donations to Biden in the 2020 election.

Fortune commented that SBF is now the leader of the crypto community, but it may also provoke dissatisfaction among some crypto believers.

Compared with those heroes in the currency circle who entered the blockchain industry for the reasons of “changing the world” and “destroying the government”, SBF joined the currency circle purely to see the opportunity to make money. And altruism is about making as much money as possible to give back to society.

Fortune believes that SBF is different from many people in the crypto community. They do not have luxury consumption such as yachts, sports cars, and parties. Instead, they pledge to donate most of their wealth because they believe in altruism.

“I would say this: I will do the right thing for people who genuinely believe in this industry. I believe in blockchain because this technology is beneficial and can make the world a better place in concrete ways.

I think I’m an example of a group of people who believe in the industry, even if they see it from a different angle. “

Will the worldview of the crypto community lead to a more chaotic world?

The next question is a bit serious and a bit philosophical.

Fortune believes that the world is on fire right now, with the rise of authoritarianism, the climate crisis, etc., so some form of collectivism is needed at this time; that is, everyone needs to consider the interests of the whole and make the right decisions. Overall favourable decision.

But the crypto community happens to be self-interest-oriented, liberal and individualistic.

Fortune posed a question: Is it possible that the rise of cryptocurrencies could lead to a decline in civic order?

SBF thinks this question is a bit strange. He believes that either collectivism or individualism can resist authoritarianism. Collectivism will consider the group’s best interests and resist tyranny, while the individuality represented by cryptocurrency inherently hates authoritarianism, which also resists authoritarianism in a certain way.

SBF believes that many of the world’s problems now come from dominating and trampling other groups, which the crypto community hates. But at the same time, we must also engage and face the world’s problems together.

“You have to get involved, and cryptocurrencies may be the answer to some of the problems, but not all of them. It’s unlikely that a single tool will solve all the problems.”

Can Bitcoin reach $100,000 in two years?

At the request of Fortune, SBF finally analysed the future prices of Bitcoin and Ethereum.

SBF believes that Eth is difficult to predict and will be more volatile with the upcoming merger , but he can’t be sure in which direction.

Bitcoin is more predictable than Ethereum, but only if the general economy doesn’t get worse.

SBF believes that Bitcoin will gradually recover from the significant liquidation, and the end of the liquidation is a big plus.

In addition, the regulatory structure of Bitcoin has gradually become clear, which is a bullish external shock. So if there is more bullishness in regulation next year, then with luck, Bitcoin can hit $100,000.

“Regulation is an external shock, and it’s bullish for Bitcoin, so if there’s a significant regulatory bullish next year, with luck, we could see $100,000 next year. But you know, it’s hard to predict.

But if you told me that bitcoin might reach $35,000 next year, I would think there was a chance.”

“Today @BlockFi signed a term sheet with @FTX_Official to secure a $250M revolving credit facility providing us with access to capital that further bolsters our balance sheet and platform strength,” he wrote in a Twitter thread.

Prince said the proceeds from the FTX loan are contractually subordinate to all client balances, meaning that BlockFi will satisfy its obligations on client accounts—BlockFi Interest Accounts, BlockFi Personalized Yield and loan collateral—before paying FTX.

The company has been especially hard hit in the downturn. Last week BlockFi joined the growing list of firms reducing their workforce to weather the crypto winter, cutting its staff by “roughly 20%.”

At the time, Prince said on Twitter that all of BlockFi’s products and services would continue to operate normally.

It’s a timely disclaimer.

Celsius, one of BlockFi’s crypto lending competitors, froze account withdrawals, swaps and transfers last Sunday to help it weather “extreme market conditions.” Yesterday, the company said it needs more time to stabilize before unfreezing accounts.

Meanwhile, BlockFi has hit its own headwinds. Last week, the company made a $1 million payment to the Iowa Insurance Division as part of a larger $100 million penalty that BlockFi agreed to pay to settle an investigation into its high-yield accounts.

‘Future collaboration’

In his announcement of the line of credit, Prince hinted that it could open the door to a partnership between FTX and BlockFi.

“This agreement also unlocks future collaboration and innovation between BlockFi & FTX as we work to accelerate prosperity worldwide through crypto financial services,” he said on Twitter.

The feeling seems to be mutual. Yesterday, Sam Bankman-Fried FTX CEO said the cryptocurrency exchange has a “responsibility” to bail out struggling companies during this unrelenting bear market.

“Even if we weren’t the ones who caused it, or weren’t involved in it,” he said, referring the wave of “contagion” that’s impacting crypto markets. “I think that’s what’s healthy for the ecosystem, and I want to do what can help it grow and thrive.”