Jesse Powell and Kevin Zhou on How FTX and Alameda Lost $10 Billion - Ep. 423

Unchained

Kevin Zhou, cofounder of Galois Capital, and Jesse Powell, cofounder of Kraken, talk about why FTX collapsed, the warning signs, and whether it’s a catalyst for self-custodial adoption.

Show highlights:

• the root causes of the FTX collapse, according to Jesse and Kevin
• whether there were warning signs of all the risks that were to come
• the importance of learning from mistakes, even for new people in the space
• Kevin's response to the stuck funds in FTX
• the debate about utilitarianism and SBF's effective altruism
• whether the philosophy behind founders matters
• Kevin's and Jesse's theories of how FTX and Alameda lost billions of dollars
• how Alameda and FTX's books were commingled
• whether people will start using self-custodial wallets
• whether the fall of FTX vindicates BTC maximalism
• whether regulation has been beneficial or harmful for American customers
• the role of venture capital firms and their "mixed incentives"

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Kevin:

• Twitter
• Previous Unchained episodes:
• How Traders Are Thinking About the Merge — and a Potential ETHPoW Chain
• Why Kevin Zhou Believes Ethereum Will Have 3 Forks After the Merge.
• The Chopping Block: Kevin Zhou on Why He Knew Terra Would Crash

Jesse:

• Twitter
• Previous Unchained episodes:
• Jesse Powell, CEO of Kraken, on Drawing a Line With Regulators

Episode Links

Previous coverage on Unchained of FTX:

• Did the Bahamian Government Direct SBF and Gary Wang to Hack FTX? – Ep. 422
• The Chopping Block: Why Lenders Didn’t Liquidate Alameda When It Was Underwater
• Erik Voorhees and Cobie on Why FTX Loaned Out Customers’ Assets
• The Chopping Block: FTX: The Biggest Collapse in the History of Crypto?
• Sam Bankman-Fried on How to Prevent the Next Terra and 3AC

FTX Collapse:

• First declaration document
• Unchained: FTX Bankruptcy Overseer Says Company’s Collapse Is Worst He’s Ever Seen
• Unchained: Bahamas Regulator Directed SBF to Transfer FTX Assets to Government Wallet
• SBF tweet: FTX files for Chapter 11 bankruptcy protection
• Vox interview with SBF: Sam Bankman-Fried tries to explain himself
• NYT: How Sam Bankman-Fried’s Crypto Empire Collapsed
• Bloomberg: Crypto Hedge Fund Galois Confirms $40 Million Exposure to FTX

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