Sam Bankman-Fried (SBF) became a headliner in newspapers throughout the media, financial and otherwise, in November of 2022, quickly attaining the status of a “Mini-Madoff” shyster. Like Bernie Madoff, SBF was formerly a well-known figure only in a smattering of households. Suddenly, a boatload of money disappeared virtually overnight, and SBF (the term brought to us by the acronym-obsessed mainstream media, or MSM) became a household word, rivaling Bernie Madoff in scope, size, and the element of surprise at his collapsing empire.
Unique, due to his age and the magnitude of the collapse, SBF has been shown to be a consummate liar and fake. His supposedly altruistic motive, wanting to make profits for the benefit of charities, was a cover for personal self-aggrandizement. Turns out, he loved the lifestyle, frequent accolades in financial media, and comparisons to superstar investor Warren Buffett. His headliner company, FTX, purchased an arena name in Miami. It has been shown that SBF made several illegal (large) campaign donations in 2022.
FTX had been touted by several celebrities, and SBF was treated as a must-have interview on financial media. His amazing success led to comparisons with giants such as Buffett. Meanwhile, SBF and a few friends were living large in the Bahamas, spending lavishly on real estate and lifestyles. Then, like a $12 hobbyist’s weather balloon over Lake Huron, his empire crashed and burned. Details of the SBF/FTX saga are left to biographers and media investigators.
Our purpose is to simply ask the pointed question, “What could possibly go wrong?” In November of 2022, the Ponzi-like scheme quickly unwound. FTX assets were frozen by the SEC, and the rest of the story is as predictable as it is well known. Real money was lost in quantities great and small. SBF morphed from the next Buffett to the next Madoff in less time than it takes to tell the story.
I have no idea what people were thinking when they chose to (1) get involved with crypto, and (2) trust a poorly groomed kid, possessing little or no standing, with billions of their real American dollars.
SBF apparently proved the declaration by P. T. Barnum that, “There’s a sucker born every minute.” He rivaled Barnum in sales ability, which apparently was outsized for a man of (only recently) 31 years of age.
Crypto is based on something we cannot see or touch and is hyped by famous people. It was supposedly created by Satoshi Nakamoto, someone no one can find.
At least Madoff dealt with real money instead of crypto. Small consolation, I suppose, for the big losers.
Van Wie Financial is fee-only. For a reason.
