Why SBF's Fraud Was About Delusions, Not Effective Altruism

Transcript

the SPF thing was like a huge shocker, you know. >> How many times did you interview him? >> Oh gosh. Um, you know, I didn't know him well at all. Um, I maybe interviewed him like twice on the show, but I I actually don't know. Um, I I know for sure it's more than once, but I don't know if it was like three times or four. I I actually don't know the number. >> Um, but like yeah, I I have so many thoughts about that one. So, okay. So, so let's just So, I know you you sent me some questions you were going to ask me, but I'm just going to answer like kind of a bunch of stuff about SPF right now.

So um okay the okay so first of all one of my biggest regrets has to do with SVF which is that after the collapse of S of FTX I wanted to interview him on the podcast but also I was writing this book proposal and I thought if I get him on the pod but I'm antagonistic then it could potentially close off like a bunch of interviews for the book. So, I was like kind of heming and >> while FTX was collapsing, you were worried about SPF's power to cancel your book.

>> No, no, no. Just um not No, no, no. Not that he would clo have any power. No, no, no. But more that um if I like reveal my cards about like what I'm interested in or whatever, then like people around him might close up and my ability to get information for the >> See, I see. I see. Okay. because I had um >> you need them as sources so you can interview them later. Okay. And you don't want you don't want to reveal yourself as an antagonist. >> Yeah. Uh because I definitely had the experience with my first book with the book about Ethereum and the ICOs and and that whole thing that there were times when I got like some juicy information and when I needed confirmation,

somehow word got out and sources that had previously been so friendly and open and giving me all kinds of stuff, they just closed up, clammed up, didn't respond. But like somehow people knew what I was after and just I just could not get anywhere. And so there there's some juicy bits I was not able to put in my book which is very disappointing. But um so I maybe because I'd had that experience I was kind of like and looking back so in the end I I know I had announced before I got a book deal to do my to do a book on FTX. I had to cancel it just because I had way too much stuff going on with my health. It it just it like that kind of undertaking would have been serious hours and I just

needed the hours for my own personal health journey which um I will probably be revealing to people in some way. What happened to me health-wise is truly insane and crazy and I've been like living a secret life about I'm ready to like come out of the closet about it but I am talking with my agent to figure out how this is going to happen and if they even want to represent the new me. um at all because uh I'm a very different person than I was when I started the podcast 10 years ago. Um but anyway, so to go back to FT um FTX and SPF, um my opinion about that and and I think David Morris maybe covered this in his book is

just like the more I learned about effective altruism and this is also why like I'm a huge fan of anthropic and Claude, but that whole Oh [ __ ] you were an effective altruist. That is correct. That is correct. >> Oh my god. Okay. So, let's have this conversation. >> Go for it. Go for it. >> So, this is my criticism and I'd love to hear you respond to this. >> Yeah. >> So, when I learn about the effective altruist philosophy, to me, it's like the the person who is being the effective altruist feels like they have given themselves a license to play God.

And I I just don't think that that's like appropriate or necessary. And I through covering crypto like do you do you remember when I wrote that article saying that I was going to vote for Kamla and stuff. >> I do remember that. Yes, of course. >> Okay, you guys, I'm not a Democrat anymore. I am independent. Um I I don't even know if I'm a liberal. Maybe I am. But I also through covering crypto and also through seeing what hypocrites the Democrats are, I'm now more libertarian, which I like before I like really understood libertarianism, I was always like, what the [ __ ] Like that doesn't make any sense. That's just anarchy.

That's terrible. And now I'm like, oh, actually, I think that probably makes the most sense. Um, but anyway, so like because because now I have like a little bit more of a libertarian philosophy. That's another reason why I don't like effective altruism. To me, it just feels like SPF thought that he knew better. Like he he thought that he could decide what is the greatest good for the most people. He felt like he had that position. Nobody gave it to him. He just took it because he has this philosophy. And I think that it's um it's just not appropriate. Like people should be allowed to make their own choices. You cannot make choices for them, you know, and and obviously explicitly in the

terms of their, you know, uh their company policies. It did not give him the right to just take their money and manage it the way that he thought he, you know, was uh whatever that was best. So um but yeah, I'm curious. I'd love to hear your response to that. I just remembered you were an FPG devultuist. >> Yeah. Yeah. Yeah. Okay. So, I I think first of all, it's important to disentangle SPF and his personal decisions from a moral philosophy. I think it's a little bit like saying, okay, you know, this um you know, Catholic priest did these really horrible things to children, therefore Catholicism uh is a bad religion and it causes these decrepit things. I think I think it's it's it's like there are a

lot of things that SPF did like violating his terms of service or stealing money and funneling it to a market maker that there's no moral philosophy that says anything about whether or not you should be doing things like that. Um and I don't I don't know anybody who would answer to the name effect of altruism in the year 2022 who would look at what SPF did and say, "Yeah, that's what our moral philosophy says that you should do." Um, I think it's very clear SPF had his own weird messiah complex or his own kind of uh moral whatever perversions that led him to believe and I don't even think it was a moral perversion to be honest. I think it was almost like a power perversion that he just kind of believed that nothing could go wrong that he would just keep winning and everything would

work out and crypto prices would go up and BlockFi would be saved and his lenders would be saved and like Alama would be saved. And this is kind of to me just ordinary um delusion of grandeur. Uh it and it happens to people all the time and we don't attribute it to their moral philosophy. Now when for SPF like what specifically does effective altruism say that lands with this idea of oh it is on me to decide what is good for other people. There's actually nothing about effective altruism that has anything to do with that. Uh the core of effective altruism is this idea that you should use your resources, your money, your time, your energy, whatever to the thing that's going to have the greatest impact on the

greatest number of people. That's the idea. It's a very simple idea. >> Oh, it's about your own resources. >> Yes. There is nothing but effective alter that says you should take control of the government or of institutions or of corporations and get them to violate the rules in order to do what you have morally calculated in Excel sheet is the optimal outcome. That's like a cartoon version of what effective altruism says you should do or what most effective altruists do. Most effective altruists do like boring ass jobs working at nonprofits or working in some government blah blah blah or like you know an NGO or something. um or they just do what I do, which is they earn money and they donate it. Um so it's sort of like for me what I do with my donations doesn't affect anybody else. I'm not

controlling anybody else. I'm not telling them what they should do. Um like doing that over and above what effective altruism actually demands is not effective altruism. It's you kind of being a douchebag. Like that's you being arrogant about this idea that you understand something from your vantage point of running a crypto exchange that you somehow understand how all resources should be allocated across the world. >> Okay. So I don't know that much about effective altruism. So is it essentially like he overapplied the philosophy? Is that a way to think about it?

>> I I I I wouldn't even put it in those terms. I would just say that he had delusions of grandeur and he was very powerful and that was the reality. Like why did SPF have that much impact at all? >> The answer was because he had a lot of money >> or at least he had them. >> Right. He donated hundreds of millions of dollars. >> Right. Right. Right. He donated hundreds. I mean he owned majority of the exchange. Um he donated hundreds of millions of dollars. He invested billions of dollars. He was making political donations. He was he had the influence in the ear of celebrities and politicians. Um that is why he had so much impact, >> right? But he was doing it with customer money, not his money.

>> Correct. Correct. Exactly. Yes. Totally. Um, but the reason why he had that impact was because he was so powerful. Right. It wasn't because of effective altruism that he did that. Now, when you are really powerful, something informs how you're going to do what you do. Right? If you're the Koch brothers or if you're, you know, whatever Warren Buffett, you're also very powerful and you decide how you're going to use that power. I think saying that, okay, well, SBF did this, therefore it's effective altruism's fault and let's get out our pitchforks and let's go burn down, you know, the Center for Effective Altruism because they did this. I'm like, I that that seems like not the right answer. It seems like no, SPF was like a uniquely [ __ ] up guy. He was like on um you know, he he was clearly very autistic.

He was on the entire time that he was there. >> I don't agree that he was don't believe that he was autistic. I I have been direct. I think it's very clear. He was like extremely >> I I mean I have physically been in his presence and the presence of Vitalik and I would definitely not call SBF autistic. >> I think he's on the spectrum. Do you not think he's on the spectrum? >> I think that he has been on different kinds of drugs that have altered his personality for a very very long time. >> You you think so? I I first met SPF in I think it was 2015 uh before he ever got into crypto. I met

him at an effective conference, first effective conference I ever went to, which was EA Global in 2015. And I met him in a hallway and I knew who he was because he was one of the few people who was actually doing effective altruism and donating money. He was working at Jane Street at the time. at the time it was like you know he donated I don't know 150k which was a big sum of money for effective altruism at that time um so he was like a big donor in our little tiny microcosm uh and I met and I I was you know I wasn't making any money at the time so I I wasn't donating anything yet um but uh I met him and he was just like a nerdy little autistic kid just like most of the people who work in who are in effective altruism um so I look

clearly he's not vitalic but I think if you if you say that He's nowhere on the spectrum. I think anybody who watches an interview of him would would dispute that characterization. >> I mean, I think he's been taking a lot of drugs for a very long time. That's what I'll say. >> Yes. Clearly, he's been on these um these like Adderall and then whatever else he's taking all these um OCD drugs for. >> So, that's altered his personality. >> I agree with that, but I don't think that's a complete description of his neuroatypicality.

I [laughter] >> I love that we have veered into the direction of somebody from >> You ask me. You asked me. So, I'm answering. I'm answering. Okay. All right. All right. Let's bring this back. >> You just caught a piece of Unchained. I'm host Laura Shin and the full conversation is in the description below. We go live every Monday and Thursday. Subscribe [music] so you never miss it. Before we dive back in, a quick word about something we make ourselves. If you like the way we cover crypto on this show, Cleareyed, no shilling, just what actually matters, you'll like the Unchained Daily. It's our free newsletter that lands in your inbox every weekday with the most important stories in crypto written by journalists, not marketers. No jargon,

no hype, no number go up cheerleading. Just the news you need to stay ahead in the time it takes to drink your coffee. Subscribe for free at unchainedcrypto.com/newsletters. Fidelity has been researching and investing in blockchain since 2014, long before it was a headline. And they're hiring crypto and DeFi professionals to join their team and discover what's next in finance. Fidelity is looking for people with fresh perspectives from different backgrounds. Whether it's tech, UX, or product design, whether you're cryptosavvy or crypto curious, as long as you have the passion to make a real impact at a company striving to make finance accessible to all. Explore crypto careers at Fidelity today and make the decision that could change your

future for the better. Visit crypto.fidelitycareers.com to learn more. That's crypto.fidelitycareers.com. Fidelity is an equal opportunity employer.