A Family Affair! – small dead animals

When you start making 20 to 1 leveraged bets on cryptocurrencies buttressed with credit arrangements that could probably be described as financial incest, it’s only a matter of time until the whole house comes crashing down. Sounds a whole lot like the current arrangements between central banks and various treasuries.

At some point, FTX started accepting FTT as collateral. In the apt words of Matt Levine, accepting your own self-issued token as collateral is “very dark magic” and is almost certain to end badly.

FTX was faced with massive client withdrawals and rapidly falling prices of the collateral sitting on their balance sheet (namely FTT) at the same time.

The CEO called it a “liquidity crunch” (euphemism). A more accurate description would be sudden death capital implosion (they were likely insolvent before they were illiquid, and likely within 24 hours).

13 Replies to “A Family Affair!”

The US Dollar is backed by the Full Faith and Credit of the United States Government (with Tapioca Joe Biden as US President and VP Kamalalala Harris).

Kenji says:

November 16, 2022 at 11:43 pm

But, but, but … BLOCKCHAIN … is the future!!!

“For the naïve there is something miraculous in the issuance of fiat money. A magic word spoken by the government creates out of nothing a thing which can be exchanged against any merchandise a man would like to get. How pale is the art of sorcerers, witches, and conjurors when compared with that of the government’s Treasury Department.”
Ludwig von Mises

FTX just attempted what the state does routinely

Kenji says:

November 16, 2022 at 11:45 pm

However … with no NDP to back it up. Smoke and mirrors to back it up. Until the wind blew and the mirror shattered

I’m wondering if the Canada Pension Plan had any money ‘invested’ in FTX. Anyone know?

Hamilton Marc says:

November 16, 2022 at 9:51 pm

Rumor has it that the Ontario Teacher’s Pension Fund invested, and lost millions: https://www.otpp.com/en-ca/about-us/news-and-insights/2022/ontario-teachers–statement-on-ftx/
1. I Am A Fugitive From The Trudeau Cult says:
  
  November 16, 2022 at 11:32 pm
  
  Pension plans for government employees should be outlawed, as should government unions.
  
  The criminal moron Alison Redford harvested ballots from the teachers’ union in Alberta in exchange for using taxpayer dollars to make good the “shortfall” in the teachers’ pension fund. For “shortfall” read fraud, misrepresentation, and malfeasance.
  
  For such a quid pro quo, did Redford serve prison time? Bah, there was never any question of even charging her with a crime.
  
  The power “elite” make their own rules, and always at the producing person’s expense.
2. VOWG says:
  
  November 17, 2022 at 6:37 am
  
  I saw the number 95 million in one article.

I hoping Maxine Waters had all her, and her family’s money invested in FTX.

https://mobile.twitter.com/jason_howerton/status/1592959342898126848?cxt=HHwWgICp8aOFqpssAAAA

The USD is backed by a printing press, located in Zimbabwe!

I Am A Fugitive From The Trudeau Cult says:

November 16, 2022 at 11:35 pm

It’s backed by Patriot missiles, stealth fighters, and nuclear bombs. God help us if it ever really comes to that. It seems as though much of the non-western world has had enough of subsidizing the USD’s “exorbitant privilege”.