Spotlight on FTX VCs - as expected

I said this at the start of this FTX debacle.

FTX VCs liable to ‘serious questions’ around due diligence — CFTC Commissioner

The lack of recordkeeping of FTX coupled with “an auditor no one’s ever heard of” forces the CFTC to ask questions about the mindset of the institutional investors.

“How is that possible? So do they turn a blind eye to it? Were they just distracted by this promise of innovation?”

No, it was planned fraud all along to scare away investors from crypto. Then to buy up the good assets on the cheap and crush any genuine innovations. The coming regulations will set a high bar to new entrants.

Not unlike the kovidity scam: create fake data (in this case huge volume of wash-trading), then fake future profits based on that fake data, then have a small number of lead investors sucker in some newbs to invest relatively modest amounts, but for a small stake that hugely inflates the value of the whole enterprise. Lastly, wait for a total amateur (or two) to fuck up.

No doubt there will be plausible deniability.