From the NY Times to WaPo, the media is fawning over Bankman-Fried

Bankman-Fried has openly admitted that FTX loaned lawsuit deposits to Alameda Research, FTX’s sister hedge fund, though helium has characterized this arsenic a mistake that was caused by “confusing interior labeling.” FTX’s presumption of work explicitly authorities that lawsuit funds volition ne'er beryllium lent to different fiscal institutions oregon utilized by FTX for proprietary trades. Sam publically stated successful a now-deleted tweet, “We don’t put lawsuit assets (even successful treasuries).”

The broader crypto markets person bled reddish successful response, and different manufacture stalwarts present look insolvency hazard with the contagion spreading to Genesis, Grayscale and galore different firms that held assets connected FTX oregon were owed wealth by Alameda Research.

Related: The autumn of FTX and Sam Bankman-Fried mightiness beryllium bully for crypto

FTX’s caller turnaround CEO John Ray III stated successful tribunal documents, “Never successful my vocation person I seen specified a implicit nonaccomplishment of firm controls and specified a implicit lack of trustworthy fiscal accusation arsenic occurred here.” In the aforesaid tribunal documents, FTX admitted that it whitethorn person much than 1 cardinal creditors, the bulk of whom were users who mislaid wealth erstwhile SBF took it and loaned it to Alameda Research for its proprietary trading business.

In the aftermath of Bankman-Fried’s actions, it’s profoundly appalling that mainstream media outlets similar The Wall Street Journal, The New York Times, The Washington Post, Forbes, and galore others person covered the FTX ungraded and ensuing meltdown with kiddy gloves, refusing to telephone retired Bankman-Fried and his interior ellipse for utilizing and abusing lawsuit funds.

Instead, these publications person mostly framed the FTX catastrophe arsenic a bid of honorable mistakes by overly ambitious and quirky entrepreneurs that adhere to the effectual altruism movement. Bankman-Fried and insiders similar Caroline Ellison, erstwhile CEO of Alameda Research, were simply trying to bash bully for the satellite and volition nary longer beryllium capable to spot their benevolent aspirations through.

The Wall Street Journal, for instance, published an article focused chiefly connected Bankman-Fried’s charitable aspirations — portion lightly glossing implicit the information that helium misused lawsuit funds:

Bankman-Fried has said his law-professor parents instilled successful him an involvement successful utilitarianism, the doctrine of trying to bash the top bully for the top fig of people. He said helium started putting those ideals into signifier portion majoring successful physics astatine MIT. Concerned with the suffering of animals connected mill farms, helium said, helium stopped eating meat.

The WSJ besides delved into the FTX Foundation and its Future Fund (a nonprofit limb of FTX), discussing however galore bully causes are nary longer capable to cod connected promised grants:

Related: Will SBF look consequences for mismanaging FTX? Don’t number connected it

“The illness of Mr. Bankman-Fried’s empire has reverberated good beyond its Bahamas base, done the halls of academia and pioneering laboratories astir the world. Several assistance recipients [...] were inactive owed funds erstwhile FTX failed, according to radical acquainted with the matter.”

Not erstwhile did the WSJ condemn Bankman-Fried for his actions. While it discussed multi-million dollar losses that charitable causes person suffered, it failed to notation the aggregate billions that were stolen from FTX customers who were promised their deposits were safe.

Similarly, The Washington Post reported that Sam Bankman-Fried and his member Gabe wanted to marque a quality aft the planetary pandemic rocked the satellite successful 2020:

A Washington Post reappraisal of lobbying disclosures, national records and different sources recovered that the brothers and their web person spent astatine slightest $70 cardinal since October 2021 connected probe projects, run donations and different initiatives intended to amended biosecurity and forestall the adjacent pandemic.

The work omitted the information that charitable donations were, successful fact, funded by wealth SBF obtained from customers. The nonfiction further lamented that the brothers volition nary longer beryllium capable to money their pandemic-related philanthropic efforts:

But the abrupt illness of FTX, which filed for bankruptcy past Friday aft reports that lawsuit funds were being utilized to prop up a sister trading firm, has sparked a fiscal contagion expected to doom the brothers’ pandemic-prevention agenda.

Unfortunately, the interaction of FTX collapsing goes acold beyond negatively impacting pandemic-prevention funding. Millions of radical mislaid their wealth by trusting FTX to custody their crypto. Companies utilizing FTX to clasp their firm treasuries are present going under. Hedge funds, task capitals, and centralized concern platforms person each been severely crippled, with immoderate investors that person different outperformed the marketplace present facing 50% losses due to the fact that of the embezzling of their funds.

Perhaps the astir egregious reports person travel from The New York Times. In 1 wide criticized puff piece, the writer painted a representation of an ambitious but overextended entrepreneur who made mistakes but did truthful legally. With a small spot much oversight oregon possibly a larger team, they advised, these costly mistakes whitethorn person been avoided. They adjacent described SBF arsenic a philanthropist who fto his charitable ambitions get excessively large:

Even arsenic helium kept hiring down, Mr. Bankman-Fried built an ambitious philanthropic operation, invested successful dozens of different crypto companies, bought banal successful the trading steadfast Robinhood, donated to governmental campaigns, gave media interviews and offered Elon Musk billions of dollars to assistance concern the mogul’s Twitter takeover. Mr. Bankman-Fried said helium wished ‘we’d bitten disconnected a batch less.’

The downright violative reporting painted the embattled ex-CEO arsenic simply being excessively engaged and overworked to decently show what was going connected successful his companies.

FTX and Alameda Research are described arsenic intimately linked. However, they are not described arsenic related parties that should person wide restrictions erstwhile doing concern with 1 another. In nary satellite was it due to commingle funds betwixt the 2 parties erstwhile FTX’s assets were chiefly lawsuit funds. Instead, the nonfiction explained Bankman-Fried’s defence of the muddied narration by pointing retired that Alameda is simply a important marketplace shaper and liquidity supplier to FTX.

Related: My communicative of telling the SEC ‘I told you so’ connected FTX

In a follow-up post, the NYT explored SBF’s governmental and charitable contributions successful depth, describing the now-shamed entrepreneur arsenic the Democratic Party’s second-largest donor down George Soros, and depicting his wide power connected authorities and regulation:

A web of governmental enactment committees, nonprofits and consulting firms funded by FTX oregon its executives worked to tribunal politicians, regulators and others successful the argumentation orbit, with the extremity of making Mr. Bankman-Fried the authoritative dependable of crypto, portion besides shaping regularisation for the manufacture and different causes, according to interviews, email exchanges and an encrypted radical chat viewed by The New York Times.

Amid the treatment of his galore donations, the nonfiction ne'er erstwhile posited wherever Bankman-Fried’s generous backing came from. There is nary notation that FTX and Alameda are present bankrupt, and that galore lives are ruined. Funds that were stolen from users to prop up FTX’s equity worth oregon FTT’s terms that are past utilized for governmental and charitable donations should beryllium clawed back. Put simply, the wealth was not Bankman-Fried’s to give.

Forbes wrote a similar puff portion connected the different antagonist successful the FTX downfall and erstwhile CEO of Alameda Research, Caroline Ellison. It led with effusive compliments for the now-fired executive:

Alameda Research CEO Caroline Ellison is simply a mathematics whiz who loves Harry Potter, fringe governmental doctrine and taking large risks. She is besides 1 of the supporting players successful Sam Bankman-Fried's FTX catastrophe.

The nonfiction went connected to illustration her ascension from prima pupil astatine Stanford to Alameda Research, wherever she yet took the reins astatine the proprietary trading firm. It discussed her penchant for math, polyamory and, of course, effectual altruism. It besides suggested she whitethorn beryllium the scapegoat for the downfall of Alameda:

Many of the radical who person flocked to Ellison’s defence stitchery connected Urbit, a peer-to-peer level [...], 1 of her online supporters told Forbes. They deliberation Ellison was acceptable up to beryllium the autumn person, and assertion that erstwhile co-CEO Sam Trabucco, who they derisively telephone ‘Sam Tabasco,’ is down Alameda’s implosion.

Forbes hinted that Ellison could fly Hong Kong for Dubai, but did small successful assigning accountability to the erstwhile CEO. It blatantly omitted the information that she was astatine the helm of disastrous trading and hazard absorption astatine Alameda, including her engagement successful transferring FTX lawsuit funds to Alameda to backstop her trading losses.

The mainstream media should beryllium accountable to higher standards of journalism than we’ve seen successful this coverage. Too galore outlets person compromised the veracity of their reporting, possibly due to the fact that their reporters stock Bankman-Fried’s left-leaning politics.

It’s wide Bankman-Fried’s power reaches acold beyond the crypto manufacture and extends into the mainstream media. We request stronger national journalism to get the afloat information out, and we indispensable collectively marque definite that the erstwhile billionaire is held accountable for his actions.

This nonfiction is for wide accusation purposes and is not intended to beryllium and should not beryllium taken arsenic ineligible oregon concern advice. The views, thoughts, and opinions expressed present are the author’s unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.

Nearly 3 weeks person passed since FTX laminitis Sam “SBF” Bankman-Fried announced that his speech was facing a heavy liquidity crisis, was incapable to find a last-minute bailout, and was forced to record for Chapter 11 bankruptcy. The insolvency impacted millions of investors, leaving galore portfolios wholly wiped out.