Who's at fault for FTX's wrongdoing

DM conversation I had with Eliezer in response to this post. Since it was a private convo and I was writing quickly I had somewhat exaggerated in a few places that I've now indicated with edits.

Habryka

Hmm, I do feel like I maybe want to have some kind of public debate about whether indeed we could have noticed that a bunch of stuff about FTX was noticeable, and whether we have some substantial blame to carry. 

Like, to be clear, I think the vast majority of EAs had little they could have or should have done here. But I think that I, and a bunch of people in the EA leadership, had the ability to actually do something about this. 

I sent emails in which I warned people of SBF. I had had messages written but that I never sent that seem to me like if I had sent them they would have actually caused people to realize a bunch of inconsistencies in Sam's story. I had sat down my whole team, swore them to secrecy, and told them various pretty clearly illegal things that I heard Sam had done [sadly all uncomfirmed, asking for confidentiality and only in rumors] that convinced me that we should avoid doing business with him as much as possible (this was when we were considering whether to do a bunch of community building in the Bahamas). Like, in my worldview, I did do my due diligence, and FTX completely failed my due diligence, and I just failed to somehow propagate that knowledge. 

Also, ultimately Sam's social group was my social group. The author of the Scholomance books did not also happen to hang out with Sam at multiple 5-day retreats in the last year. They are not close friends with metamours of Sam and Caroline. They do not share 75% of their friends, do not hang out in the same office and do not read the same forums, all in addition to not subscribing explicitly to the same ethical philosophy that's centered around a few thousand pages of writing. [To clarify some exaggerations, I think I share more like 30% of friends with FTX leadership, and Caroline visited Constellation, a Berkeley coworking space that I sometimes work out of, a number of times in the last year, though neither she nor Sam usually work there]

Like, I am open to there being nothing I could have done, but the conclusion doesn't seem obvious to me at the moment. 

EliezerYudkowsky

I asked Sam a couple of times if we could schedule a long conversation, and he never got back to me go figure.  I passed through the Bahamas and ended up meeting with the Future Fund people but not, iirc, the FTX people.  I don't have the sense that SBF was one of My People.  If Caroline was one of My People and not just somebody who read some EY fiction but ultimately a Singer/Givewell type, I haven't yet heard the account of it.

The question isn't whether there's anything we could've done, but anything we could've done in a more meaningful sense than I "could've" recced Bitcoin to HPMOR readers in 2010.

Habryka

I mean, I am a lot more embedded in the EA space beyond MIRI than you are, and I mean, I think there is an important sense in which I don't think you had the relevant info, but I do think a bunch of other people had. 

I do also think it is pretty unlikely we could have prevented FTX exploding, though I do think we could have likely prevented FTX being super embedded in the EA Community, having a ton of people rely on its funding, and having Sam be held up in tons of places as a paragon of the EA community. 

Like, I think we fucked up pretty hard by saying for a few years that we think Sam did great by our values, when I think it was already pretty clear by that point that he quite likely wasn't.

EliezerYudkowsky

I wouldn't mind if you wanted to post that, or if you wanted to post this whole conversation.  My experience was much more of FTX being some weird distant people who were doing a kind of longtermism that never intersected with much I considered useful until their regranting program started.

Habryka

Cool, I might post this chat.

I'm analogizing Peter Singer and classical Givewell-style EA to Novik.

What about the parts of EA that isn't Peter Singer and classical GiveWell-style EA? If those parts of EA were somewhat responsible, would it be reasonable to call that EA as well?

I don't think the analogy is helpful. Naomi Novik presumably does not claim to emphasize the importance of understanding tail risks. Naomi presumably didn't meet Caroline and encourage her to earn a lot of money so she can donate to fantasy authors, nor did Caroline say "I'm earning all of this money so I can fund Naomi Novik's fantasy writing". Naomi Novik did not have Caroline on her website as a success story of "this is why you should earn money to buy fantasy books or support other fantasy writers".  Naomi didn't have a "Fantasy writer's fund" with the FTX brand on it. 

I think it's reasonable to preach patience if you think people are jumping too quickly to blame themselves. I think it's reasonable to think that EA is actually less responsible than the current state of discourse on the forum. And I'm not making a claim about the extent EA is in fact responsible for the events. But the analogy as written is pretty poor, and doesn't really make a good case for saying EA has zero responsibility here (emphasis added):

Who's at fault for FTX's wrongdoing?

FTX.

Ask a simple question, get a simple answer.

You have no right to blame yourself any more than that.  You weren't that important.
 

Here are some excerpts from Sequoia Capital's profile on SBF (published September 2022, now pulled). 

On career choice: 

Not long before interning at Jane Street, SBF had a meeting with Will MacAskill, a young Oxford-educated philosopher who was then just completing his PhD. Over lunch at the Au Bon Pain outside Harvard Square, MacAskill laid out the principles of effective altruism (EA). The math, MacAskill argued, means that if one’s goal is to optimize one’s life for doing good, often most good can be done by choosing to make the most money possible—in order to give it all away. “Earn to give,” urged MacAskill. 

... 

It was his fellow [fraternity members] who introduced SBF to EA and then to MacAskill, who was, at that point, still virtually unknown. MacAskill was visiting MIT in search of volunteers willing to sign on to his earn-to-give program. 

At a café table in Cambridge, Massachusetts, MacAskill laid out his idea as if it were a business plan: a strategic investment with a return measured in human lives. The opportunity was big, MacAskill argued, because, in the developing world, life was still unconscionably cheap. Just do the math: At $2,000 per life, a million dollars could save 500 people, a billion could save half a million, and, by extension, a trillion could theoretically save half a billion humans from a miserable death. 

MacAskill couldn’t have hoped for a better recruit. Not only was SBF raised in the Bay Area as a utilitarian, but he’d already been inspired by Peter Singer to take moral action. During his freshman year, SBF went vegan and organized a campaign against factory farming. As a junior, he was wondering what to do with his life. And MacAskill—Singer’s philosophical heir—had the answer: The best way for him to maximize good in the world would be to maximize his wealth. 

SBF listened, nodding, as MacAskill made his pitch. The earn-to-give logic was airtight. It was, SBF realized, applied utilitarianism. Knowing what he had to do, SBF simply said, “Yep. That makes sense.” But, right there, between a bright yellow sunshade and the crumb-strewn red-brick floor, SBF’s purpose in life was set: He was going to get filthy rich, for charity’s sake. All the rest was merely execution risk. 

His course established, MacAskill gave SBF one last navigational nudge to set him on his way, suggesting that SBF get an internship at Jane Street that summer. 

In 2017, everything was going great for SBF. He was killing it at Jane Street... He was giving away 50 percent of his income to his preferred charities, with the biggest donations going to the Centre for Effective Altruism and 80,000 Hours. Both charities focus on building the earn-to-give idea into a movement. (And both had been founded by Will MacAskill a few years before.) He had good friends, mostly fellow EAs. Some were even colleagues. 

... [much further down in the profile] 

So when, that next summer, MacAskill sat with SBF in Harvard Square and carefully explained, in the way only an Oxford-educated philosopher can, that the practice of effective altruism boils down to “applied utilitarianism,” Snipe’s arrow hit SBF hard. He’d found his path. He would become a maximization engine. As he wrote in his blog, “If you’ve decided that some of your time—or money—can be better spent on others than on yourself, well, then, why not more of it? Why not all of it?” 

On deciding what to do after leaving Jane Street: 

SBF made a list of possible options, with some notes about each:

1. Journalism—low pay, but a massively outsized impact potential.
2. Running for office—or maybe just being an advisor?
3. Working for the movement—EA needs people!
4. Starting a startup—but what, exactly?
5. Bumming around the Bay Area for a month or so—just to see what happens. 

On setting up the initial Japanese Bitcoin arbitrage at Alameda: 

Fortunately, SBF had a secret weapon: the EA community. There’s a loose worldwide network of like-minded people who do each other favors and sleep on each other’s couches simply because they all belong to the same tribe. Perhaps the most important of them was a Japanese grad student, who volunteered to do the legwork in Japan. As a Japanese citizen, he was able to open an account with the one (obscure, rural) Japanese bank that was willing, for a fee, to process the transactions that SBF—newly incorporated as Alameda Research—wanted to make. 

The spread between Bitcoin in Japan and Bitcoin in the U.S. was “only” 10 percent—but it was a trade Alameda found it could make every day. With SBF’s initial $50,000 compounding at 10 percent each day, the next step was to increase the amount of capital. 

At the time, the total daily volume of crypto trading was on the order of a billion dollars. Figuring he wanted to capture 5 percent of that, SBF went looking for a $50 million loan. Again, he reached out to the EA community. Jaan Tallinn, the cofounder of Skype, put up a good chunk of that initial $50 million. 

On the early days at Alameda: 

The first 15 people SBF hired, all from the EA pool, were packed together in a shabby, 600-square-foot walk-up, working around the clock. The kitchen was given over to stand-up desks, the closet was reserved for sleeping, and the entire space overrun with half-eaten take-out containers. It was a royal mess. But it was also the good old days, when Alameda was just kids on a high-stakes, big-money, earn-to-give commando operation. Fifty percent of Alameda’s profits were going to EA-approved charities.

“This thing couldn’t have taken off without EA,” reminisces Singh, running his hand through a shock of thick black hair. He removes his glasses to think. They’re broken: A chopstick has been Scotch taped to one of the frame’s sides, serving as a makeshift temple. “All the employees, all the funding—everything was EA to start with.” 

On how he was thinking about future earnings: 

“Am I,”  [reporter asks], “talking to the world’s first trillionaire?” 

...

“Maybe let’s take a step back,” he says, only to launch into an explanation of his own, personal utility curve: “Which is to say, if you plot dollars-donated on the X axis, and Y is how-much-good-I-do-in-the-world, then what does that curve look like? It’s definitely not linear—it does tail off, but I think it tails off pretty slowly.”

His point seems to be that there is, out there somewhere, a diminishing return to charity. There’s a place where even effective altruism ceases to be effective. “But I think that, even at a trillion, there’s still really significant marginal utility to dollars donated.” 

...

“So, is five trillion all you could ever use to help the world?” 

...

“Okay, at that scale, I think the answer might be yes. Because, if your spending is on the scale of the U.S. government, it might have too weird and distortionary an impact on things.” 

... so, money spent now will be more effective at making the world a better place than money spent later. “I think there are some things that are pretty urgent,” SBF says. “There’s just a long series of crucial considerations, and all of them matter a lot—and you can’t fuck any of them up, or you miss most of the total value that you could ever get.” 

To be clear, SBF is not talking about maximizing the total value of FTX—he’s talking about maximizing the total value of the universe. And his units are not dollars: In a kind of GDP for the universe, his units are the units of a utilitarian. He’s maximizing utils, units of happiness. And not just for every living soul, but also every soul—human and animal—that will ever live in the future. Maximizing the total happiness of the future—that’s SBF’s ultimate goal. FTX is just a means to that end. 

On what differentiates FTX in crypto: 

The FTX competitive advantage? Ethical behavior. SBF is a Peter Singer–inspired utilitarian in a sea of Robert Nozick–inspired libertarians. He’s an ethical maximalist in an industry that’s overwhelmingly populated with ethical minimalists. I’m a Nozick man myself, but I know who I’d rather trust my money with: SBF, hands-down. And if he does end up saving the world as a side effect of being my banker, all the better.

On the EA community in the Bahamas that congealed around FTX: 

A cocktail party is in full swing, with about a dozen people I don’t recognize standing around. It turns out to be a mixer for the local EA community that’s been drawn to Nassau in the hopes that the FTX Foundation will fund its various altruistic ideas. The point of the party is to provide a friendly forum for the EAs who actually run EA-aligned nonprofits to meet the earn-to-give EAs at FTX who will fund them, and vice versa. The irony is that, while FTX hosts the weekly mixer—providing the venue and the beverages—it’s rare for an actual FTX employee to ever show up and mix. Presumably, they’re working too hard.

...

“Imagine nerds invented a religion or something,” says Woods, stabbing at my question with vigor, “where people get to argue all day.”

“It’s… an ideology,” counters Morrison. The argument has begun. 

Woods amiably disagrees: “EA is not an ideology, it’s a question: ‘How do I do the most good?’ And the cool thing about EA, compared to other cause areas, is that you can change your views constantly—and still be part of the movement.”

...

Woods serves up an answer to my question. (Fittingly, she’s wearing tennis whites.) “EA attracts people who really care, but who are also really smart,” she says. “If you are altruistic but not very smart, you just bounce off. And if you’re smart but not very altruistic,” she continues, “you can get nerd sniped!”

...

“This ties into the way FTX is doing its foundation,” Morrison says, helpfully knocking the ball back to my true interest. “The foundation wants to get a lot of money out there in order to try a lot of things quickly. And how can you do that effectively?” It’s a rhetorical question, a move worthy of a preppy debate champ who went to a certain finishing school in Cambridge—which is exactly what Morrison is. “Part of the answer is to give money to someone in the EA community.”

“Because EA is different from other communities,” Woods continues, picking up right where Morrison left off. “They’re like, ‘This is the ethical thing, and this is the truth.’ And we’re like, ‘What is the ethical thing? What is the truth?’” 

Following your analogy, if a fan of Novik had: 

• been convinced by Novik to dedicate their career to the Novikian ethic 
• been pointed by Novik to a promising first job in that career path 
• decided to leave that promising first job on the basis of Novikian reasoning, framing the question of what to do next in Novikian terms 
• worked with a global network of Novikians to implement an international crypto arbitrage 
• received seed funding from a prominent Novikian to scale up this arbitrage 
• exclusively hired Novikians to continue scaling the arbitrage once it started working 
• thought about forward-facing professional decisions strictly in terms of the Novikian ethic 
• used their commitment to Novikianism to garner a professional edge in their industry 
• used a large portion of the proceeds of their business to fund Novikian projects, overseen by a foundation staffed exclusively by elite Novikians and advised by Novik herself
• fostered a community of Novikians around their lavish corporate headquarters 

... then I think it would be fair to attribute some of the impact of their actions to Novikianism. 

This seems to be a false equivalence. There's a big difference between asking "did this writer, who wrote a bit about ethics and this person read, influence this person?" vs "did this philosophy and social movement, which focuses on ethics and this person explicitly said they were inspired by, influence this person?"

I agree with you that the question

Who's at fault for FTX's wrongdoing?

has the answer

FTX

But the question

Who else is at fault for FTX's wrongdoing?

 Is nevertheless sensible and cannot have the answer FTX.

Agree, we shouldn't give a pass to irrational (frankly, egocentric) thinking just because it feels like taking responsibility. 

I feel especially irritated with people who are ready to change their entire utilitarian philosophy just because someone associated with ours (probably) committed a major crime and got caught, as if they didn't understand last week that they lived in a world where surprises like that can happen. I don't understand how else they could update their moral philosophy so fast based on the info we have.

idk, when people explicitly endorse your ideology as why they endorse "high leverage and double-or-nothing flips" I think it's at least worth taking a look at yourself. Now quite probably the person in question has misunderstood your ideology and doesn't understand why EAs do in fact care about the risk of ruin and why stealing money isn't ok, but then perhaps try to correct them?

Fwiw I think it very unlikely that the decision to use customer funds was a one-off decision made in 2022. My view is that that FTX was set up from the start to use customer money as a source of cheap capital for Alameda. In 2018 Alameda was offering potential investors a 15% guaranteed return on loans. It seems fairly likely that at some point SBF figured "fuck this, why are we offering these dorks 15% when we can just set up our own exchange and access huge amounts of capital at 0%". Never mind that the fact that privileged information from the exchange may well have opened up  for Alameda more ways to make money! 

The plan, imo, was always to accrue as much as wealth as possible as fast as possible with as few ethical constraints as possible. This worked for a while because Alameda's trades were profitable and crypto was in a bull market. This plan may or may not have been a EA-aligned, but if you have short enough AI/pandemic timelines (I don't), it doesn't seem obviously non-compatible and given the career backgrounds and interest set of all the major people involved, yes, I think they were committed and sincere EAs who really believed this stuff. SBF's own weird version of EA, at least, seems to have played a fairly large role in why they took on so much risk, as he himself explained in an overly long and boring twitter thread somewhere and Caroline also mentioned on her blog.

It also makes zero sense to compare FTX's spending on stadiums vs the Future Fund as a sign for how much they cared about these respective things. The Future Fund would almost certainly have got way more money in subsequent years, while the stadium rights purchase was a form of advertising designed to help grow the business faster. I can't imagine SBF is a big sports fan and was doing that sort of thing because he really enjoyed seeing the FTX logo on umpire shirts. 

Not to Godwinpost, but this isn't really "were Nietzsche and Wagner at fault for the Nazis", it's more "were Nietzsche and Wagner at fault for the Nazis if they'd actually lived throughout the 1930s and worked in prominent cultural education posts in the German state bureaucracy."

The role of the EA movement in the case of FTX seems surely to meet the level of influence for some of the impact win's that EA has had so far here.

Perhaps most prominently, the movement:

• Gave the idea of 'Earning to Give' to Sam
• Provided a primary motivation to Sam and other FTX leadership to build the exchange

For example, when comparing to the case of Sendwave, the influence seems at least comparable and if not larger e.g. played a motivational role in founding a company, for the purpose of improving the world. (I'm not familiar with Wave's founders motivations, so could be wrong here)

In welfare terms alone, the impact of FTX's collapse on it's customers seems plausibly comparable to some of the impact win's of the movement to date. I.e. of the order of $1bn in lost funds. Given this, I think that an honest impact evaluation of the EA movement would include the harm caused to customers through FTX's collapse.

This is relevant not for blame assignment, but because it's very decision-relevant to EA's mission of improving the world. For example, when in the future deciding how much to emphasise harm avoidance when  encouraging the (good and novel) idea of Earning to Give.

It is well-written, but I am not particularly convinced by the fantasy fiction analogy — it feels a lot more like “Here’s this very different situation, and you agree that the conclusions would be different. That would even be true if we modify it in several hard-to-imagine ways.”

In particular, I don’t see any reasonable analogies for:

• EA’s “Earning to Give” career path, up to and including 80k featuring a profile on SBF as an exemplar.
• The specific logic of “my marginal money is going to be donated” => “I should be closer to risk-neutral”, which I haven’t really seen rebutted on the facts (most instead argue that in reality, SBF/FTX/Alameda went too far and were risk-seeking).

That SBF ultimately contributed such a paltry amount of his apparent fortune is more impactful, but mainly as a reminder of how small and vulnerable EA actually is. It might very well be true that we didn’t mean that much to SBF, but he meant a lot to us.

I don’t [currently] view EA as particularly integral to the FTX story either. Usually, blaming ideology isn’t particularly fruitful because people can contort just about anything to suit their own agendas. It’s nearly impossible to prove causation, we can only gesture at it.

However, I’m nitpicking here but - is spending money on naming rights truly evidence that SBF wasn’t operating under a nightmare utilitarian EA playbook? It’s probably evidence that he wasn’t particularly good at EA, although one could argue it was the toll to further increase earnings to eventually give. It’s clearly an ego play but other real businesses buy naming rights too, for business(ish) reasons, and some of those aren’t frauds… right? 

I nitpick because I don't find it hard to believe that an EA could also 1) be selfish, 2) convince themselves that ends justify the means and 3) combine 1&2 into an incendiary cocktail of confused egotism and lumpy, uneven righteousness that ends up hurting  people. I’ve met EAs exactly like this, but fortunately they usually lack the charm, knowhow and/or resources required to make much of a dent. 

In general, I’m not surprised with the community's reaction. Best case scenario, it had no idea that the fraud was happening (and looks a bit naïve in hindsight) and its dirty laundry is nonetheless exposed (it’s not so squeaky clean after all). Even if EA was only a small piece in the machinery that resulted in such a [big visible] fraud, the community strives to do *important* work and it feels bad for potentially contributing to the opposite.

I still think that this incident should overall update most EAs in the direction of 1) ethical injunctions are important for humans and 2) more EAs should read the ethical injunctions section of the sequences. I agree that there is no system of ethics, or cultural movement, so awesome that it will stop its most loyal adherents from doing terrible things, but some do better than others. Nobody should feel guilty except for the people who committed the crime, but it would be great if EAs thought the right amount about how to lower the prob of events like this in the future, and that amount is not zero. 

I'm  also not sure how to square your advice about how I should relate to this incident with heroic responsibility.

There are however a number of things we ARE at fault for here.

1. We as a community idolised SBF, including promoting him in many presentations, a relatively fawning interview by 80K which continued to promote the idea that SBF was living frugally (surely people knew by then that was bs). We could have chosen not to do this
2. Will MacAskell made the introduction to Elon to try and get SBF to help buy twitter. We still have no public information why, but this would have given SBF more power and used a lot of money that could have been used on doing good to that end. Why?
3. Carrick Flynn campaign; we as a community hugely supported this campaign which was quite blatantly SBF and GBF trying to buy a seat for their interests. Sure, we as a community thought this was also our interests (and I still assume Carrick would have done a good job?) but once again this was a way the community encouraged and didn't question SBFs power
4. Will MacAskell knew SBF for 9 years, seemingly relatively closely. Its not Wills fault SBF committed fraud, but it is partially Wills fault SBF became such a face for the community within and outside of it. Maybe no ordinary person could have known SBF was a fraudster. But then, if we only expect from Will what we expect of "ordinary people" why are we happy trusting him with so much power in the community? The only justification I can think of is he is just so so so much better at decision making, having a reliably positive impact and avoiding risks to the community and project of EA. Its clear that Will isn't this uniquely good. So why do we trust him (and others) with so much power in the community

From an upcoming post I am drafting: I would point out that ‘heroes put the entire group, many innocent people, ‘the city,’ planet Earth or even the whole damn universe or multiverse in grave danger to save any main character or other thing that We Cannot Bear To Lose, because That’s What Heroes Do’ is ubiquitous in our fantasy media. It might be a majority of DC comics plots. Villains invoke it because decision theory, they know it will work, and even without that it is rather mind-bogglingly awful. That kind of thinking needs to be widely condemned and fall in status at least via What The Hell Hero moments, and I worry it has more influence in these situations than we think. 

First a disclaimer that I’ve never got anywhere close to interacting with SBF personally; I’m very much an outsider to this situation. However, from everything I have read, I think it’s pretty ridiculous to suggest that EA wasn’t the main reason SBF tried so hard to maximize profit (poorly, I might add, but it seems like that was his goal) to the point of committing fraud. As far as I understand EA was SBF’s primary guiding ideology; it is why he went down this career path of Jane Street and then starting his own companies. This post seems overly reliant on the fun fact that SBF paid more for e-sports naming rights than on EA donations to show why actually Sam didn’t care about EA that much. But these are two completely separate things! E-sports naming rights is just a means of advertising, with the goal of making FTX more money which will eventually allow SBF to donate more to EA. I think there’s also decent evidence that SBF was looking to ramp up donations in the future, as Effective Altruism continues to grow and is able to use more funding. Once you take out this fun fact about SBF’s current EA spending, I think this whole argument kind of falls apart.

I like this post much more than your previous post.

Is there a source for the $140M figure?

When comparing the size of SBF/FTX outlay on EA vs. stuff like naming rights, I think it is important to compare apples to apples. As far as the victim's perspective, the key question is "how much money went out the door" as opposed to "how much did SBF/FTX plan or commit to spend in the future?" Although I don't know how the naming rights deals were set up, I suspect that much of the money was to be paid in the future. That means the stadiums, teams, etc. are now general unsecured creditors on any claims. I am hearing that depositor claims may be valued on the distressed-debt market at 3-5 cents on the dollar, so the claims of naming-rights counterparties are likely worth even less.

The question that heads this post obviously answers itself, in that only actual perpetrators  of bad deeds and their direct instigators (intellectual or otherwise) are to be held accountable for them; nevertheless, I must admit that I found Eliezer Yudkowsky' analogy unconvincing, and  (not quite, but feeling a little bit) disingenuous. Whenever we see examples of adherents of some creed, ideology, religious or thought system going into nefarious places, it is natural to wonder if said ideas (whether properly or mistakenly interpreted) influenced or condoned the path they took. Some articles I have read lately have pointed the finger towards the hubristic hazards of miscalculating for optimal results, and the concomitant dangers of risky betting and of cutting corners. As is well known, the road to hell is paved with good intentions. And besides, as has been stated, a lot of the people involved in this weren't just 'fellow travelers' or ocasional readers of EA material. A lot of them were very visibly engaged in and seen as poster childs for the movement. And I am sure most of them were innocent victims, especially so the rank-and-file workers of FTX and Alameda.

Having said that, I do not find it  reasonable either to go to masochistic extremes of self-flagellation. Humans being what they are, there will always be cases of wolves in sheep's clothing, and never enough controls to catch them in advance. Which is humbling, in a not necessarily bad way. My impression is that the EA community and its members are a wonderful group of people and they  will probably come out of this situation wiser, if sadder. And that obviously, it is wrong to blame EA for what has happened.

As Eliezer Yudkowsky mentions Caroline Ellison's blog, I would like to say that I have been reading it of late, and even taking into account the potential deceitfulness of  words and the pictures we build with them, I do not get from both its contents and her general trajectory that she could be a morally bankrupt person. On the contrary, the impression I got is of a true believer, and a good person. This does not preclude the possibility that, under circumstances of a certain naiveté and inexperience in a field as murky as crypto, she might have let herself go along with what she might have perceived as temporary  and 'bad' expedient means. But to believe this person ever intended to purposely and maliciously scam people our of their money or be privy to a fraud is, for me, completely out of the question. I believe the best option is to be charitable and await to see what the courts of law have to say once the dust has settled. As for SBF, and after reading some of the things he has said and done, that's a completely different story.

In case anyone wants a reference for the $210 million that FTX committed to spend on esports naming rights for TSM, a  Washington Post article from today is here

I'm very new here, just signed in today so I'm unfamiliar with all the formats at the point but I often seek to explain how biological factors can play a role in morality or our decision making because it can be useful to understand our brain's limitations among all the other factors.

Stress, isolation and the position of power have consequences for the brain. The less cooperative one has to function within their society to leads to damage in areas of the brain responsible for decision making, the anterior cingulate cortex being the most key area. It breaks down the ability for the human to manage their own emotions and impulse control becomes a problem over time. I haven't followed SBFs career closely but there were perhaps signs of his brain struggling. Addiction is a typical symptom this is occuring.

We are but human, all of us, and we can't supercede how our brains evolved to operate. It's a very tricky position to have so much responsibility and power, that consolidation of power becomes potentially harmful as it did with FTX. This is my no means an excuse for SBF, it's just a potential problem to consider when engaging in effective altruism through large amounts of wealth. Managing ones own ego is maybe a lot harder than some anticipated. Perhaps even the most difficult tasks they'll ever do because of the design of the brain. Lots and lots of emotional self care would help, but free will is a tricky concept of whether it's possible to beat our own brains since we make decisions before we become aware we did. Self compassion is a very important piece, maybe one SBF did not have.

I agree that EA likely wasn't a major causal factor for FTX/SBF's likely fraud. Unfortunately, it's a situation where even if it's not our fault it is our problem. People are trashing EA across the internet because of Sam's position in the movement. His Twitter profile pic still has him wearing an EA shirt for christ sake! 

Can you imagine how you'd judge it if, rather than my writing it as a joke, Naomi Novik had gone online and sincerely tried to accept blame for FTX's fall, because she thought she hadn't been careful enough to put messages about good corporate governance and careful accounting into her fantasy novels, and Novik had talked about how she was planning to donate an appropriate portion of her Scholomance book royalties back to FTX's ruined customers?

Even so, I'm still recommending people to read Terry Pratchett instead of Novik. Something something low probability, large impact.
But seriously, I think the problem is less how SBF self-identified with EA, and more the way EAs saw him as The Hero.

Anyway, maybe EAs do have a problem of egocentrism. 

We can infer that probably at least $30 of Scholomance sales are due to Caroline Ellison, and with the resources that Ellison commanded as co-CEO of Alameda

C'mon, if she's a true maximizer using depositors money, I guess she'd just download it from z-library
OMG, is this why z-lib was recently seized by FBI? 

Poor accounting, possibly just no really global accounting or sense of where the money was going;

I chatted with an Alameda python dev for about an hour. I tried to get a sense of their testing culture, QA practices, etc. Lmao: there didn't seem to be any. Soups of scripts, no time for tests, no internal audits. Just my impression. 

My type-driven and property-based testing zealot/pedant side has harvested some bayes points, unfortunately. 

If there's anyone other than FTX who's really to blame, here, it's me.  I've written some fiction that tries to walk people through the experience of abandoning sunk costs and facing reality.  Including my most recent work.

Caroline Ellison, according to her tumblr, had even started reading it...

But her liveblogs cut out before she got very far in.

I just wasn't a good-enough writer; I lost my reader's attention, and with it, perhaps, the world.

We do not know her absolute state of mind when FTX (mis)used customer deposits. But, for all its worthiness, I wouldn't have predicted ahead of time that EY's writings packed a sufficient multiplicative weight to attain the sufficient condition that drove the state. I think the simple answer is whole (per the current corpus of evidence); 'FTX.'.