Who really is Sam Bankman-Fried? And how did he go from being the most-talked about and celebrated cargo-shorts-and-T-shirt-wearing cryptocurrency billionaire to bankrupt and facing jail time in just a few short years?
That’s the central question in Michael Lewis’ new book, Going Infinite: The Rise and Fall of a New Tycoon, which is a fascinating read that delves into the world of effective altruism, high-frequency trading, and the sketchy world of cryptocurrencies.
Lewis was already closely following Bankman-Fried before the implosion of his companies, quantitative trader Alameda Research and cryptocurrency exchange FTX, in late 2022. He had a front seat view as FTX clients pulled their funds, forced the companies into bankruptcy, and Bankman-Fried faced police scrutiny and criminal charges.
But Lewis has faced backlash over his tale chronicling Bankman-Fried and FTX’s spectacular rise and crash, as he paints a sympathetic view of the now disgraced trading genius and math geek who has been convicted of criminal charges and awaits sentencing in March, with a second trial to come.
While Lewis is known for writing about unsung heroes, he can’t manufacture that story here. He tries to explore Bankman-Fried’s childhood but finds little to talk about as SBF, as he became known, spent that time immersed in video games (which remains his key focus throughout his life so far), math contests and camps, and made few friends.
However, Lewis did find as many people involved in FTX and Alameda Research to talk to as possible, and was able to shape the character of SBF as one who seems to live his life as if in a video game where there are no set rules. Winning games or solving puzzles with ever-changing rules is how SBF got his first job on Wall Street with Jane Street Capital. That talent of swiftly calculating probabilities and working out market imbalances is what guides SBF as he creates Alameda Research and FTX. Lewis finds that SBF is a utilitarian and lives his life void of empathy or emotions and relies mainly on rational thought of measurable actions to make decisions. He gets heavily involved in the effective altruism movement, which aims for people to make as much money in whatever way possible to then donate those funds to charities that prove they change lives. The goal for an effective altruist is to save as many lives as possible with the funds they earn over their lifetime, not the aim of most billionaires in the world today.
Lewis stresses that SBF isn’t like your usual billionaire blowing cash on frivolous purchases, instead it goes to charities and politicians in the pursuit of the effective altruism movement’s goals. To the end, Sam Bankman-Fried insists he is “innocent of fraudulent intent.” But his three closest colleagues were willing to plead guilty and testify against him.
Lewis raises questions about what happened to SBF, noting that attorney John Ray, named CEO of the failed companies and left to sort out the bankruptcy, had found at least US$9.3-billion in FTX and Alameda assets. Lewis writes: “Ray was inching toward an answer to the question I’d been asking from the day of the collapse: Where did all that money go? The answer was: nowhere. It was still there.”
Lewis’s tale of the SBF saga ends before the crypto entrepreneur headed to trial in the U.S. Readers already know how this book ends – with the companies’ failure – but there’s more to this story with SBF already convicted in one trial and facing a second trial in March. My guess is we haven’t heard the last from Lewis on the tale of Sam Bankman-Fried.