I want to set a standard, like, “Look, we’re just not going to try and fuck you, we’re gonna try and be reasonable, we’re going to try and be generous when we can. Because if that’s true, just doing the deal becomes fucking impossible, right?
The bigger piece of this, frankly, is a trust thing where I don’t want to have to worry when I’m doing a deal about whether the other side is going to try and fuck me in 20 ways I’m not anticipating. I want to be in a position where when we work with people, we’re a little more generous than we have particular reason to be. I hope it’s not overstating it, though it might be. The mandate here was to make deals that are kind of reasonable, maybe even a little bad, but not horrific.Ī longtime crypto insider told me you’re going to come out of this looking like Warren Buffett-owning a lot, and everyone owing you a lot of favors. You know, if a place blows up, can it cause more places to blow up? Are we gonna see a chain reaction?Īnd then the third thing, subordinate to those two: Is there a good deal for us here? Or to be precise, is there a “not bad” deal for us here? The mandate here was not to try to make amazing acquisitions. First: Is there a way for us to backstop customer assets? The second thing is stopping contagion spread. What’s the strategy here?īankman-Fried: There are a few things that go into it. You’ve weathered this downturn pretty well ⁵ and used it to acquire stakes in a number of other companies. Morgan and other plutocrats who scooped up assets during earlier eras of turbulence in American finance. SBF’s dominance has sparked comparisons to J.P. Meanwhile, he has also taken about a 7.6% stake in trading app Robinhood, and outright acquired a crypto gaming company. Once dubbed the “prince of risk” for his trading exploits, SBF has lived up to the label during the downturn, investing in numerous troubled ventures and exemplifying the Warren Buffett maxim: Be “greedy when others are fearful.”Īcting much like a one-man central bank, SBF has backstopped players ⁴ including struggling lender BlockFi (with a $400 million credit facility) and crypto asset broker Voyager Digital (a loan of around $500 million), which is now in Chapter 11 bankruptcy proceedings. Then there may be a new round of carnage that comes from that. If the Nasdaq has another 25% left to drop, and if interest rates are actually going up to 7%, and if we’re going to be in a recession for two and a half years-in that world, I think Bitcoin might go down to $15K or $10K. Now, that is all with the assumption that the overall macro environment doesn’t degrade from here.
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It’s been healthy that people have had to rethink how to value assets and had to be a little more grounded-and to realize that we’ll build back a stronger industry. And I think it’s been a healthy weeding out.
I think we’ve already seen the worst of it there’s a little more to come, but it’s not very bad.
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