Let’s Talk About the New York Times' ‘Puff Piece’ on Sam Bankman-Fried

How complicit is the media in the FTX and Alameda Research co-founder's rise and fall?

AccessTimeIconNov 15, 2022 at 7:33 p.m. UTC
Updated Nov 18, 2022 at 5:31 p.m. UTC
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Sam Bankman-Fried has been typing out a cryptic message in the days since his crypto empire, composed primarily of the FTX exchange and Alameda Research hedge fund, bottomed out. “What,” the thread began, followed by single tweets containing single letters spelling out “H A P P E N E D.”

Indeed, what happened? A lot of information has come to light in the days since crypto poster boy Bankman-Fried has become a subject of criminal investigations the world over, including on-chain evidence suggesting FTX customer funds were used to backstop losses at the market making trading shop Alameda.

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There are conspiracies regarding Bankman-Fried’s donations and familial ties to political leaders, suggesting he was prepaying for amnesty or favorable regulatory treatment, and screenshots of Bankman-Fried’s open-office desk, with what appear to be prescription stimulants and off-brand nootropics on view.

There's been sleuthing into the romantic ties between Bankman-Fried and former Alameda CEO Caroline Ellison, and reblogs of her very strange “California rationalist”-tinged writings about race science and polycules.

There are leaks of private messages and transcripts from supposed internal meetings where Bankman-Fried and Ellison at times ask employees to lie publicly about their businesses’ solvency and also seemingly admit guilt about abusing funds.

In short, there is no lack of suspicion about what happened at FTX and Alameda. For many, Bankman-Fried’s fall from grace is bigger than the suspected $10 billion dollar hole he burned into his companies’ balance sheets. In just three years, SBF had built a reputation as the people’s billionaire, someone who wanted to bring crypto mainstream and donate his fortune.

“It feels like when Sam wins, we all win,” I remember a crypto trader saying in a since-deleted tweet responding to the accusation that SBF was like BitMEX co-founder Arthur Hayes, who apparently traded against users of his derivatives exchange. Bankman-Fried, who was suspected of doing the same thing on his platform “built by traders, for traders,” could be forgiven, due to his charitable persona, tireless work ethic and off-the-chart intelligence.

Open secrets were seemingly pushed under the rug. In retrospect, it’s suspicious just how many media projects Bankman-Fried bankrolled – from the industry’s most influential podcast “Up Only,” co-hosted by the influencer Cobie, to a popular show at CoinDesk and upstart media company Semafor (co-founded by former Bloomberg CEO Justin Smith and industry legend Ben Smith). He was someone not just building a reputation, but an aura.

We watched Bankman-Fried, often dressed in shorts and unbecoming garb, grow fat and slovenly under the stress of the bull and bear markets. We saw him make a mockery of Congress, entering the chamber with untied shoes. He was “one of us,” many have said. The pain of FTX’s downfall is more than financial – it’s a personal betrayal.

And so, on Monday, after the New York Times published the first interview with Bankman-Fried since his public fall from grace, it wasn’t surprising there would be angry readers and commenters. The article, written by Times crypto beat reporter David Yaffe-Bellany (with contributions by industry legends including Erin Griffith and Ephrat Livni), has been widely slammed as a “puff piece.”

“At the same time they were pumping the FTX scam, they were writing defamatory gossip pieces about industry stalwarts, driving their audiences away from safe, reliable and proven venues,” Kraken ex-CEO Jesse Powell said, presumably referring to his exchange and Coinbase, which have been center to a few media storms.

“Disgusting complicity on the part of the New York Times. He has ruined countless people's lives by theft and fraud, and NYT is now helping him to delay or evade justice by whitewashing him in their prestigious, influential newspaper. I doubt this is just a mistake on their part,” Zcash co-creator Zooko Wilcox said.

At risk of sounding complicit in an effort to launder Bankman-Fried’s reputation, I want to say simply that the Times article is … fine. In about 1,500 words, Yale-grad Yaffe-Bellany tries to distill a narrative that really requires a book. In a story where so much is still speculation, there is little that writers on deadline can do.

Was the interview a missed opportunity? Probably, for both sides of the call. Yaffe-Bellany says Bankman-Fried stayed on the line for over an hour – and yet there are no direct quotes concerning the conflict of interest between FTX and Alameda, neither a confirmation or denial that SBF illegally commingled funds between the two or further admissions of guilt. There's little sense SBF, who stepped down from the exchange, is taking responsibility for the situation.

But, what, you want SBF to perjure himself? It’s a shame that Yaffe-Bellany wrote about Bankman-Fried’s cryptic Twitter thread, rather than the tweets he has been deleting. It sucks we know nothing more about the Bahamian withdrawals FTX opened, claiming it was at the behest of the island nation’s securities regulator – which the agency debunked. It is also regrettable that the Times failed to note the eccentric former billionaire had invested in the video game he said he was playing.

However, it seems clear enough that questions were asked of SBF and dodged. And there’s reason to doubt everything he says regardless, considering how he lied to users to get them to keep funds on FTX. The truth will come to light – former insiders will continue to speak out and criminal investigations will go deep. We can assume the worst of SBF, but he also deserves a fair trial rooted in facts.

The media, perhaps especially crypto-native publications, is complicit in the rise of Bankman-Fried. However, it was CoinDesk’s Ian Allison that knocked over the first domino, and several publications (alongside citizen journalists) continue to break news regarding SBF’s house of cards. But there are things that can be suspected, and things that are known.

We don’t know if Bankman-Fried was committed to the philosophy of “effective altruism” (EA), driven by greed or possibly suffering side effects of Emsam (which includes compulsive gambling). Perhaps, EA itself is always flawed – a useful cover to excuse any bad deed in service of some poorly defined goal of “the good” – as flawed as the idea of a “centralized” exchange for decentralized assets.

In a real sense, Bankman-Fried never represented crypto. People first realized this after getting wind of his regulatory agenda, which would have eliminated financial privacy, tanked decentralized finance (DeFi) and built a moat around FTX. And so, even if the New York Times wants to write a softball story about a billionaire who (inexplicably) is finally getting some sleep – does it matter? It speaks volumes.

UPDATE (Nov. 18, 2022 – 17:30 UTC): Updates list of media projects that had FTX as an advertiser.


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Daniel Kuhn

Daniel Kuhn is a deputy managing editor for Consensus Magazine. He owns minor amounts of BTC and ETH.

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