Astral Codex Ten

Alameda Research

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Alameda Research

Article

Alameda Research is a recurring organization in the Astral Codex Ten archive, appearing 4 times across 4 issues between November 16, 2022 and August 16, 2024. The archive places it in contexts such as “his Alameda Research fund”; “mer’s deposits to gamble on shitcoins through his Alameda Research fund”; “Center for Effective Altruism leaders discussing concerns about Alameda Research in 2018”. It most often appears alongside FTX, Sam Bankman-Fried, Twitter.

Metadata

  • Category: Organizations
  • Mention count: 4
  • Issue count: 4
  • First seen: November 16, 2022
  • Last seen: August 16, 2024

Appears In

Source Context

Recovered passages from the original issue text. When the raw archive preserved outbound links inside the source passage, they are listed directly under the quote.

The Psychopharmacology Of The FTX Crash
November 16, 2022 · Original source
What a fucking asshole! Illegally stealing customer's deposits to gamble on shitcoins through his Alameda Research fund! He's the reason BTC was depressed this bull cycle. Sam is the reason I am still here watching fucking depressing crypto news instead of being completely out and having lower blood pressure... and he is a fucking customer of ours! What a weird fucking world this is.
Mantic Monday: Twitter Chaos Edition
November 21, 2022 · Original source
Polymarket again within 2% of Manifold. Only 23 traders here, and they’re a lot less optimistic than the Trump traders. FTX! 43 traders, seems like probably. I’ve seen a lot of Twitter takes about how rich well-connected people never get in trouble for this kind of thing, but the markets seem less cynical. 251 traders, and by the way amazing job by “mr22” who started this market on October 5. I also appreciate the relatively late end date - there’s another market “. . . by 2024” which is in the 30s, but that’s because people don’t trust the justice system to move quickly, not because they think he’ll be found innocent. There are a series of markets on sentence length which seem to suggest more than a month but less than a year in jail; this doesn’t really make sense to me and I’m going to nervously ignore them. Only 8 traders here, so take with a grain of salt, but this is a great example of the creative ways people are using Manifold. The market resolves not to “yes” or “no” but to the percent of FTX US users’ funds that they eventually get back; you make money if you were closer than other traders. Here they seem to think most people will only be getting about 14 cents on the dollar. There’s another market for FTX.US users which is a little higher at 29. 34 traders. I think this is too high; I bet it was some random third-tier insider, just because there are more of them and they’re under less scrutiny. Moving on to the effects on effective altruism in particular (just assume I have all possible conflicts of interest here): 272 traders, check the detailed resolution criteria. I think the strongest case is something like the one described in this article, about Center for Effective Altruism leaders discussing concerns about Alameda Research in 2018. The article doesn’t give specifics but my guess is they were the same issues Kerry Vaughn describes here (though see the followup comment by an employee who left FTX, casting doubt on Vaughn’s claims). That means the market hinges on whether Vaughn’s allegations fit the resolution criteria that “the unethical behavior must have been related to fraudulent investment strategies that involve spending other people's money without their permission”. Vaughn describes “poor capital controls, including a lack of distinction between money owned by investors and money owned by Alameda itself”, which sounds like it’s in that direction but could cover a wide variety of badness levels. My guess is everyone will end up agreeing that disgruntled Alameda employees whisper-networked that some things were bad about the company in 2018, some of the rumors got to CEA leaders, the leaders debated whether this was worse than normal for a tech startup, decided it didn’t rise to a level where they needed to publicly freak out, and moved on. Isaac will have to pay attention to the details as they come out and decide whether or not it qualifies. 45 traders. This seems to confirm that the CEA incident is responsible for most of the probability mass above; many fewer people think the FTX Future Fund (ie the charitable branch of FTX responsible for giving out their money) was in on this. Related: this market only has five traders, but I’m highlighting it anyway in the hopes that it gets more. The most money is on 2022. My guess is that we’ll find that they had terrible accounting practices in 2018-2019 of the sort that could be classified as criminally incompetent in a way that bled into fraud (but the trades went fine so nobody was harmed) and then they ramped it up a lot in 2022 to deal with the crypto crash. I think this market will be harder to resolve than people expect. 47 traders. Everyone is panicking about this possibility, but it looks like it’s not too likely. 10 traders. I’ll take this chance to say: a lot of media is predicting the death of EA, or a major blow to EA, or something in that category. Not going to happen. The media isn’t good at understanding people who do things for reasons other than PR. But most EAs really believe. Like, really believe. If every single other effective altruist in the world were completely discredited, I would just shrug and do effective altruism on my own. If they instituted the death penalty for effective altruism, I would do it under cover of night using ZCash. And I’m nowhere near the most committed effective altruist; honestly I’m probably below average. “Saint gets eaten by lions in Colosseum, can early Christianity possibly survive this setback?” Update your model or prepare to be constantly surprised. 6 traders. So, we lost several hundred million dollars of funding in a giant disaster which was also morally outrageous and demoralizing. It happens. But lots of people have already emailed me asking how to send in more money to help fill the gap. Some added something like “it was so depressing that all the FTX money meant my money didn’t make a difference, but now I can help again, and it’s great!” Can these people fill the hole? 32% chance that they can! 10 traders. And if they don’t, we’ll still probably do better than in 2021, before all the FTX money started rolling in. We’ll try harder to hammer in the point about not doing “ends justify the means” reasoning, and do some reorgs and purges to prevent anything like this from happening again, we’ll make a bunch of other changes - some reasonable, some panic-driven - but we’ll go on. If all the far-future stuff collapses, we’ll donate to global health charities. If the global health charities don’t work, we’ll fund GiveWell to sit around and figure out something that does. If GiveWell gets hit by an asteroid, we’ll work on asteroid deflection (actually I think we might already be doing that). If asteroid deflection turns out to be -EV, we’ll switch to shrimp welfare, or give ourselves Zika virus, or any of a million other things. You have no idea how committed we are to continuing to do effective altruism regardless of whether or not it’s “popular”. But it will be popular. 45 traders, resolution criteria at the link, notice the dip when the FTX news broke, followed by recovery as people had time to think it over more. Moving on to slightly less serious topics: The snapshot doesn’t show this, but one of the suggestions is Atlas Rugged. 67 traders, interesting to see where forecasters’ priorities lie. This was a big rumor early on, along with “everyone was on meth”, but the on site psychiatrist said it was false during an interview. 13 traders. WHY DO PEOPLE KEEP GOING ON PODCASTS? Midterms! That was two weeks ago? It feels like years! A week before the midterms, I wrote: Polymarket, Manifold, and PredictIt now have shiny interfaces for predicting the upcoming US midterm elections. In terms of the Republicans taking the Senate, Polymarket is at 65%, Manifold at 58%, PredictIt at 73%, and 538 at 49%. Congratulations 538! Mike Saint Antoine (who wrote the review of Viral in the last Book Review Contest) has put some more work into scoring midterm election forecasts. Here are some headline results: Mike writes: The reason I didn’t just do a three-way comparison between PredictIt, FiveThirtyEight, and Manifold Markets is that the Manifold Markets forecasts included fewer questions than the PredictIt and FiveThirtyEight forecasts. So in order to do a fair comparison here, I’ll be comparing the smaller subset of questions for which PredictIt and Manifold Markets both gave a forecast. So it looks like both Manifold and 538 did better than PredictIt, and there’s no clear way to tell which of the former did better. (except I guess you could do this analysis with just the subset of questions Manifold and 538 share, but Mike didn’t and I’m also not going to). PredictIt has a pretty consistent Republican bias (it’s a minor epistemic sin to accuse a prediction market of having a predictable bias unless you’ve made money exploiting it, I made $600 this election so I’ll let myself pass). In years when Republicans do better than expected, it will probably look better than other markets; in years when they do worse, it will look worse. Still, this is a bias, so I think we should take them doing worse this year as a fair reflection of their accuracy, even thought next year it could go the other way. My main two takeaways here are: PredictIt isn’t yet good enough that the ideal theorems showing prediction markets should be unbiased and better than everyone else apply to it. The obvious explanation is its $800-per-question cap. Polymarket doesn’t have that cap and it did better, although Mike hasn’t done a formal comparison to 538.
Inline links: more than a month, less than a year, FTX.US users, this article, here, Not going to happen, some reorgs and purges to prevent anything like this from happening again, I think we might already be doing that, turns out to be -EV, shrimp welfare, give ourselves Zika virus, wrote, Polymarket, Manifold, PredictIt, 538, Viral, scoring midterm election forecasts, https://substackcdn.com/image/fetch/$s_!z0IM!,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbcfb99af-ec23-4ff9-bcec-ffe248821898_1800x900.png, https://substackcdn.com/image/fetch/$s_!NSlN!,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fc9c5602d-e060-454b-8a20-10e925c57526_1800x900.png, https://substackcdn.com/image/fetch/$s_!vBga!,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F2b35fbd9-ee89-4f4f-b8b9-832742e483fd_881x289.png, https://substackcdn.com/image/fetch/$s_!h6tt!,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F9355d197-997a-4c48-93c0-76abc23f2c12_881x287.png
Your Book Review: Lying for Money
May 26, 2023 · Original source
Sam Bankman-Fried's origin story begins in a similar manner: his foray into cryptocurrency began with the Alameda Research trading firm, whose first mission was focused on an arbitrage opportunity that they discovered: the story, as SBF tells it, is that there was enough of a price differential between the price of cryptocurrency on US and Japanese exchanges that, if you were set up to trade in both markets, you could exploit the difference and make "free money."
"High returns with no risk" sounds too good to be true, but a 2018 fundraising deck for Alameda Research makes exactly that promise:
SBF, much like Ponzi, was desperately in search of something that would actually make his operation profitable, as SBF wasn't nearly as successful as he portrayed himself to be: according to bankruptcy professionals managing the entities that SBF helmed, between Alameda Research and FTX, he posted a net loss of $3.7 billion from inception to 2021. Raiding customer deposits – and getting people to "invest" in FTX's native cryptocurrency FTT – gave them the liquidity to keep operating.
Inline links: net loss of $3.7 billion from inception to 2021
Your Book Review: Silver Age Marvel Comics
August 16, 2024 · Original source
None of #2 takes away from the fact that Stan Lee, Jack Kirby and Steve Ditko were brilliant storytellers that created innovations in the medium that had never been seen before I am going to start with my second point: How is it possible to say that storytelling is getting better? Michael Lewis’ book, Going Infinite, about Sam-Bankman Fried (founder of FTX and Alameda Research, and convicted of fraud in November 2023) was controversial mostly because Lewis suggested that Sam was a good hearted, misunderstood guy who wasn’t really doing anything wrong. But it was also controversial for a quote from Sam about William Shakespeare. Here is part of the original blog post by Sam: I could go on and on about the failings of Shakespeare and the constitution and Stradivarius violins, and at the bottom of this post I do*, but really I shouldn't need to: the Bayesian priors are pretty damning. About half of the people born since 1600 have been born in the past 100 years, but it gets much worse than that. When Shakespeare wrote almost all of Europeans were busy farming, and very few people attended university; few people were even literate--probably as low as about ten million people. By contrast there are now upwards of a billion literate people in the Western sphere. What are the odds that the greatest writer would have been born in 1564? The Bayesian priors aren't very favorable. This quote blew up and became the story of the day among the intelligentsia on Twitter. Was Shakespeare the greatest playwright? And if he was, what is the counter argument to Sam’s point. How could it be possible that the greatest writer of all time was born in a period when there were less than 3.5MM English speakers on the planet, and only about 20% were literate? Even if he was the best writer of the 700,000 writers of the time, how is it possible he is better than the ~1.5 BILLION literate native-level English speakers alive today? Sam’s point is that it would be highly unlikely. One explanation is that Shakespeare may not have been the best writer, but he was a very good writer (the best of his time), and that he was able to pick up the low hanging fruit of writing ideas. Once Shakespeare had written Romeo and Juliet, no one else could write Romeo and Juliet (well they could, but then they would be derivative of Shakespeare’s work). The idea here is that there are innovative ideas in storytelling (and all art). The writers and artists that come first have their pick of possibilities. As more art gets created it gets harder and harder to come up with new ideas. Meanwhile the old ideas, once created, are there to be used. Richard Hanania quotes Anne Gat in pointing out there are three ways to understand greatness: Intrinsic: He produced the best plays and sonnets by some objective standard. This can be in an elitist sense focusing on the impact his work has on the most refined among us, or a more “democratic” one where the same can be said for all humans.
Inline links: Going, Sam-Bankman Fried, original blog post, Richard Hanania, Anne Gat