… But it is also bad because FTX was going around misrepresenting how it managed risk. That stuff about a computer that saw everyone’s positions, knew the value of their collateral, and acted instantly to close any positions without a loss to FTX all seems to have been misleading. In fact, FTX apparently managed its most important market risk — Alameda’s huge leveraged position — more or less by someone writing Alameda’s position on a napkin, and getting the math wrong, and then handing the napkin to Bankman-Fried, and Bankman-Fried being afraid to look at the napkin.
‘Enforcement 40’ for 2020
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