It's being debated in the bankruptcy court. Some creditors want to sell it off and others want to let it ride. Because this is crypto, some people want to issue a crypto token that represents claims on the estate.
Obviously they should divide it into a low-risk low-return tranche and a high-risk high-return tranche and market two tokens, with an LLM informed of the rules providing final arbitrage.
Naturally, we'll need to tokenize the risk tranche, leverage a decentralized finance protocol to auto-balance the portfolio, and have an AI-powered DAO govern the arbitrage, ensuring our digital assets stay liquid.
what disappoints me about this comment is how many of my well-educated non-tech friends would regard the number of technical terms here as a sign that it's a well-researched idea
thats also the kind of feedback I get in teachings from buisness advidors around pitching. "We need to see a little more proof you have credentials to pull off this idea. When we were talking last week you mentioned some technical terms, put a few of those in"
The onion stuff sounds bad but movie futures sound fine? Wouldn't it be good for studios to be able to hedge? I'm a little confused as to what the instrument is actually for, were it not for this law could I, like, short The Marvels?
It would be horrible and too easy to manipulate, think a fighter taking a dive.
Say the Marvels is coming out, Brie Larson knows everyone hates her and she's a bad actor so it will probably flop. Brie takes out a $10 million short on her own movie.
Now she has an incentive to be horrible so she acts EXTRA bad and treats people even worse than usual to be sure it flops.
Is this any different than the incentives set up by conventional publicly listed companies? Like a CEO in principle could “take a dive” but their compensation discourages that.
CEOs are also usually not allowed to take short positions in the company they head. Analogously, actors should not be allowed to short movie futures they act in.
I think this is a terrible idea, but I fully endorse it because of the chance that it could hilariously result in FTX investors losing the same money twice.
If RWAs were adopted and the tokens were non-custodial then not much. The issue with FTX is it was a centralized company and all funds were fully custodial. And while all this was happening SBF was buddy buddy with Gary Gensler. Aka it was a tradfi problem, not a crypto problem.
There is only TradFi. Crypto grew up and was assimilated. There is only one holistic system of systems, one vast and immane, interwoven, interacting, multivariate, multinational dominion of dollars.
Customers sent real money to FTX expecting FTX to buy some coin and hold it on their behalf (because managing that properly themselves is out of scope for regular folks).
So now the coin is defacto owned by FTX, not the customer.
Similar to what does not happen when you buy ATT stock in your Schwab account.
That's very similar to what happens with stocks. When you buy a stock, it's Cede & co who actually own the physical certificates that transfer rights. There's a complicated web of contractual obligations between them and other DTCC companies that exists to give you essentially the same rights as if you were a true stockholder, but it's all being done "on your behalf" in a legal sense.
Unless you directly register your stock through a DRS transfer to the issuing agent for the company. This agent manages stock issued to insiders and employees as well but any stock holder can truly own their stock the same way the CEO of the company does. It’s a pain, takes forever, and brokers will play dumb and try to prevent it, but they legally must allow you.
Generally only worth it if you intend to hold your stock for some time (which you should)
Because nobody would've lost anything had they held onto their coins instead of keeping them in centralized exchanges which are essentially banks in all but name. One of the reasons cryptocurrency was invented was to free us from the banks but they reinvented the entire banking system instead on top of it.
It’s very interesting to me because when you put your money in a bank and it enters a bankruptcy proceeding, your account (which is in essence an unsecured loan you made to the bank) disappears into the bankruptcy estate, to be shared by the various tiers of creditors in order of priority (to wit: you lose your money). Of course, the FDIC protects you.
When you put things (e.g., stock) in a “custodial account” with a company like Charles Schwab or similar, if they enter BK then your property is separate from the bankruptcy estate and must be returned to you, in theory.
FTX seems to have combined all the best features of all systems: because they had custody of the tokens, they were able to actually lose them; when they entered bankruptcy, the customer assets could not go to the secured creditors (to the extent that they were custodial, not debt) and they couldn’t go to the customer either (because “not your keys, not your crypto”).
Cherry on top: no FDIC protection. The only winner is the criminal, who is free (for a while) to use customer funds to pay Tom Brady to be his friend.
Spoiler alert: it will be sold off to satisfy the debts of the bankrupt corporation. That's SOP for bankruptcy court, and it would take an extremely persuasive case to convince the court to do otherwise.
It's unclear there are buyers for this amount of private shares at the market price.
It's one thing for Google etc to invest billions in cash and cloud services[1] into Anthropic with the understanding that money will be used for engineering and growth.
It's quite different for any buyer to come in and spend $4B on the secondary market for nothing but shares, with none of that money going to Anthropic.
There is a large appetite for exposure to the big AI companies, so maybe the demand is there. But it's not as simple as selling a large stock holding on the public market.
There's a buyer for everything at the right price.
There are tons of big private equity funds and several trillion-dollar fund managers for which buying a 10% stake of a privately held 30 billion dollar startup would just be a question of some paperwork.
If there's a way to sell it at a fair price, yes. Otherwise, they have a fiduciary responsibility to hold it until a buyer can be found to pay a fair price. They won't hold it just to let it ride though - that's correct. IANAL :-)
i dont get why the shares in the investment isn't just divvied up to each individual investor, and let them make a choice to sell or not. And if there's transaction costs involved in selling small amounts, it could be aggregated before divving up, and those who wants to sell can collectively sell and save on costs.
Holders can still band together as a single pot, like a fund which can count as only one investor.
This sounds like a loophole, and now that I think if it it probably is - VCs and stuff should not have been allowed to ask for money from pension funds without imposing at least some rules normally applied to public companies.
And now there are startups where you can place bids on private market stock without being a qualified investor or pushing the company into a spot where it has to go public.
