SBF was convicted by now on several criminal offenses. Before that, he was everyone’s darling and visionary in the crypto space.

Michael Lewis got a lot of heat for portraying SBF in a too-favorable light in his book “Going Infinite: The Rise and Fall of a New Tycoon”. I don’t see what gave people that impression (besides maybe the last chapter). SBF is destroyed in this book.

People believe he is a con man and a malicious actor. Lewis’s book spends most of its pages describing the terrible bookkeeping and management practices as well as SBF’s philosophy of risk-taking. I guess this is where the emotional responses come from, Lewis portraying SBF first and foremost as incompetent and only partly as a criminal.

Lewis writes that SBF did know about the backdoor that allowed Alameda to have a negative balance and dip into the funds of customers of FTX (clearly a criminal act). SBF might have believed that this is okay as long as the money is somewhere on the balance sheet between Alameda and FTX. However, if you consider that most of the balance sheet was highly volatile crypto assets, the potential risk of losing more money was always there.

Also, he completely ignored the dire situation of the company balance sheet by starting a 2 billion venture fund and continuing to spread money like it was candy… I mean come on!

SBF’s religion is expected value. He obviously never read Taleb and doesn’t care about ruin risk. Well, now he’s ruined and in the end, as SBF himself would agree with, the intent doesn’t matter much. What matters is that when customers came to collect their money it wasn’t there. If this was because of a bunch of checked-out kids cluelessly breaking and losing things, or because of savvy criminals filling their pockets, both lead to the same result: 8 billion missing from customers' (and lenders') accounts.

It amazes me how much money the right person can make in the right circumstances. SBF would probably not have been such a charismatic media personality in a different age. He probably also wouldn’t have made so much money outside of the unregulated (experienced high-frequency trader absent) crypto markets.

He had a good run, despite his poor management and business skills. Now the run is over. We were fooled by randomness as long as it lasted. But in the end, he would inevitably have gone bust with his mental model of risk.