Sam Bankman- Fried is increasingly alone

Why did he make me a billionaire? The video interview with Broeksmit, an avid cryptophile, and the creators of Incognito

A billion dollars is a boring day in the winter. The amount is there, in its 10-figure glory, glaring from my phone screen in white characters against a charcoal background: $1,112,172,834.

The gift and hospitality policy at WIRED appears to prohibit staff from accepting gifts over $30. I’d had no plans to become a billionaire. And yet the man messaging me on Signal has decided that sending me a billion dollars in cryptocurrency is the best way of proving his point about the legitimacy of a crypto app. His plan is to exploit a possible vulnerability in a cryptocurrency wallet app to squeeze money out of thin air, and in the process, expose the app as either shoddy or fraudulent. A few minutes earlier, he had written that he wanted to become an “alchemist.”

Early in the day after he makes me a theoretical billionaire, Broeksmit calls me from his loft in downtown Los Angeles. The conversation was three hours long and was spiced with rapid-fire topics about his favorite pub in London and the org chart of the KGB. His live-in partner, visual artist Marie Peter-Toltz, occasionally chimes in—sometimes in Spanish—to dispute the sequence of events. The call ends a few times because of the hole in his pillow caused by a cigarette. Broeksmit comes across as a skilled raconteur, but also erratic and impulsive. The pooled balance of several different crypto coins, amounting to a billion dollars, is still in my wallet. How did he do it?

They werebroke as shit, which is why they started looking intoCryptocurrencies in the winter of 2021. During his research, Broeksmit chanced upon Incognito Wallet, which developed a blockchain where people can exchange and trade cryptocurrencies via peer-to-peer payments or through a decentralized exchange (DEX), which allows cryptocurrencies to be swapped directly without going through intermediaries. Incognito was created by an anonymous team mostly based in Vietnam.

Incognito also lets users mint their own cryptocurrencies, Broeksmit says. One just has to pick a name and ticker symbol and provide information about the purpose of the coin in order to launch it as an asset tradable within Incognito’s ecosystem. Incognito suggests that businesses can create these coins to drum up publicity or dole out promotional rewards to customers. Normally, these coins appear to have a value of zero dollars, as no one is seeking to trade them for pricey mainstream cryptocurrency on Incognito’s exchange.

The story of Alameda, Bankman-Fried, and the FTX Money Launderer, CASEY MITCHELL

The $652 million outflow seemed to be a combination of FTX’s movement of coins into its own storage wallet and a mystery robbery, according to Elliptic. According to Elliptic, fully $477 million of the funds appear to have been stolen, though another crypto-tracing firm, TRM Labs, puts the number at $338 million. Most of the money went into a few addresses that were already being tracked by the world’s largest tracing industry, amateur sleuths and law enforcement around the globe.

Chris Janczewski, head of investigations at TRM Labs and a former Special agent at the IRS, said they were watching the movements of the funds. “This potential thief has hundreds of millions of dollars. They went into the bank and took as much money as possible, and then the dye packs went off. Everyone knows they have a lot of money, but they don’t know it is connected to the bank robbery. Can you tell me what to do with it?

Keptocracy and dark money networks intersect across the globe with the work of writer and investigative journalist, CASEY MITCHELL. He is a writer with a book on how the US created the world’s greatest money-laundering scheme in history. His opinions in this article are of his own. Read more opinion at CNN.

Defendants and Bankman-Fried knew that FTX, at Bankman-Fried’s direction, had allowed Alameda to invest “client assets” and that Alameda had in fact done so, using FTX customer funds to make investments far riskier than “treasuries.”

The entire situation is unsurprising, and it could have been foreseen. After all, this is hardly the first case of alleged fraud we’ve seen from a figure like Bankman-Fried. And, as opposed to what any lawyer would advise, SBF, as he is commonly known, didn’t remain silent. He went on an apology tour, tweeting, speaking to reporters and even virtually participating in the yearly DealBook Summit in New York last month where he said he “didn’t ever try to commit fraud on anyone.”

Many of the cases that appear to be traditional Ponzi schemes are as old as American capitalism itself. They almost always pair a lack of regulation and oversight with promises of easy wealth schemes, all predicated on some kind of proprietary technology that seems to generate returns out of thin air.

Just look through American history, and the same story repeats itself, over and over. The first Great Depression of the 20th century was the Panic of 1873, which resulted in widespread bank failures and the collapse of the American economy.

Between the overall lack of regulation and the influx of billions of dollars into the crypto industry over the past year, the only thing surprising about the FTX collapse is that it didn’t happen sooner.

In that sense, Bankman-Fried may be no different than his predecessors. Given the continued lack of regulation and oversight in the crypto industry, Bankman-Fried is not only a new version of an old story, but hopefully the start of long-overdue change in the industry, with the kinds of regulations and transparency needed to prevent other scammers, fraudsters and criminals from simply stepping in to replace Bankman-Fried.

Ms. Ellison and Mr. Wang contradicted Mr. Bankman-Fried’s defense. The authorities filed documents yesterday that claim Mr. Bankman-Fried was aware of what was happening at Alameda.

How Many Coins Are Really Collectible? A Study by Chainalysis using the Liquidity Provider Term for a Pump and Dump

“Looking at our blockchain data, we realized the best way we could contribute is by looking at tokens created for the express purpose of a pump-and-dump by the liquidity provider,” says Kim Grauer, head of research at Chainalysis, using the term “liquidity provider” to mean the creator or issuer of a token. There are millions of them. How many are legitimate, and how many are scams?”

A lot of them are not real. Chainalysis found that only a tiny fraction of the million-plus coins created in the year 2022, 9,902, gained any value due to lack of marketing. The token’s creator dumped all but 24 percent of them within their first week of sale.