We were unable to send the article.
The name Sam Bankman-Fried was unfamiliar to me until his equally unfamiliar company collapsed in November, but everything I’ve learned about SBF and FTX Trading Ltd. seems to confirm lessons that I learned long before I ever heard of cryptocurrency.
► First I embraced Warren Buffett’s excellent advice: “Never invest in a business you cannot understand.” I think there are relatively few people who truly understand cryptocurrency well enough to invest in it, and even fewer people who can afford such a risky investment. To hand one’s cryptocurrency investment over to an unregulated private company outside the United States was to layer murky risk upon murky risk.
► In 2000, as the dot-com bubble was bursting and interest rates were creeping up, a Little Rock banker told me: “The first thing I look for in a lending department is gray hair.” Bankman-Fried was 27 when he created FTX in 2019 and persuaded supposedly sophisticated equity investors to give him some $2 billion with what The New York Times described as “not much of a pitch: It was a take-it-or-leave-it offer.” He made clear that he was going to run his company his way with little oversight, and this display of arrogance apparently worked.
I’m not suggesting that all young entrepreneurs are incompetent — or crooks. But it was just foolhardy to give total control of billions of dollars to…
