First: the one thing we absolutely, without a doubt, know with certainty about the FTX debacle at this point is this: it will be a great streaming series sometime in the next two years. Think we're exaggerating? Well, Michael Lewis - who spent the last six months with FTX's wunderkind, Sam Bankman-Fried, is already auctioning off the rights to the book he hasn't finished yet with Netflix and David Fincher swooping in from on one side and Andrew Ross Sorkin (the Billions creator) and his group coming from the other.
When it does, it won't be just a few episodes - it could run years . . . because here's the thing (and we're only a week or so into it): it's already incredibly complicated, its many layers are unraveling the way an onion the size of a watermelon would.
Right now, 10:03 am (CST), Tuesday, November 22, 2022, the FTX mess might be the largest bankruptcy case in the U.S. since Lehman Brothers - or it might be the largest bankruptcy case in the Bahamas, ever. Or not a bankruptcy matter at all. Two solid facts: over one hundred companies affiliated with FTX are [really] filing for bankruptcy. FTX has well over 1 million creditors, that could be a record of sorts.
It is probably (maybe) the worst, most widespread and farthest-reaching example of corporate mismanagement since Enron. It maybe (probably is) the most disastrous de-valuation of a currency since the Weimar Republic.
FTX could well end up (almost certainly will) as the biggest hacking victim since the first computer was plugged in. (Wired just reported that a hack late on November 11th drained between $335-447 million from FTX holdings just as they were filing for bankruptcy).
It could be (odds are about the same as the Cowboys making the Super Bowl) the largest fraud case since Bernie Madoff. It will be (most likely) one of the most public, well-covered, nastiest extradition fights (USA v Bahamas) this side of former FIFA executives.
You’ve no doubt noticed we used a lot of ‘conditionals’ so far. We also included the time and date we wrote this. That’s because this is happening at something akin to warp speed, the more details that emerge – virtually every hour – the more the overall picture changes, the more far-reaching are the consequences. The news of the hack, for instance, hit as we were writing the first paragraph.
We’ll be writing more about this – in a somewhat (as much as possible) lineal way – next week.
For now, here are a few things that you can take to the bank (sorry):
- The shareholders of the venture capital firms that invested (heavily) in FTX will be suing the execs who okayed the deal(s).
- A who’s who of athletes, actors, sports teams, and leagues are being sued as part of class action suits by FTX’s customers.
- Criminal investigations are coming; congressional hearings will be conducted.
- There will be at least one sad story of a charity that loses everything.
Until next week.
Happy Thanksgiving.