Vitalik Buterin has spoken out about the collapse of the FTX Derivatives Exchange, run by Sam Bankman-Fried (SBF). In what sounds like an apology for SBF’s failure, Vitalik Buterin first said that stakeholders shouldn’t take everything the disgraced crypto founder did as part of the larger conspiracy to scam everyone.
“To automatically devalue every single thing that SBF believed in is a mistake. It is important to think about and determine which things contributed to the fraud and which things did not“, he said in a tweet on Tuesday. “Don’t be the guy who would have tried to overturn vegetarianism in 1945“, he added.
For those who understand, it seemed that Vitalik Buterin was justifying the misdeeds of SBF, which, for some, still has not come to address and apologize to crypto Twitter as it should. Crypto leaders who responded to Vitalik Buterin did not support the justification position, especially because the 30-year-old former CEO misused the principles of the”effective altruism“.
“Vitalik, if you try to save the Effective Altruism brand, it is dead“, said Ava Labs founder Emin Gün Sirer. “It has contributed to fraud by providing a cover (linear utility) for unchecked greed. SBF, and its shallow philosophy, is not a hill worth defending.“
Prior to its collapse, FTX and its sister trading firm, Alameda Research, presented themselves as a lender of last resort and attempted to rescue failing companies in the crypto-currency ecosystem. Two of the well-known companies that FTX and Alameda have attempted to save are BlockFi and Voyager Digital. The initial $500 million in bailout funds sent to the latter was the final straw for the allied companies.
Vitalik Buterin admits SBF acted selfishly
Having worked as the lead developer of Ethereum since its inception, Vitalik Buterin can spot inconsistencies in behavior when he sees one. Based on the concept of effective altruism, which is the subject of debate regarding SBF, Buterin came to the conclusion that the former mega-billionaire may have acted selfishly by using EA as a cover to make gains while claiming it is for the greater good.
“I think it’s worth talking about the danger of using AE as a justification strategy“, said Martin Köppelmann, the co-founder of the DeFi Gnosis platform, about effective altruism. “You can abuse EA ideas to justify every shitty behavior that makes you money, because you can pretend it’s all for a greater good.“
Vitalik Buterin agreed with Köppelmann, noting that his position explains one of the subtle reasons that led to the collapse of FTX.
Oh I agree, that is one of the things that contributed to what happened.
– vitalik.eth (@VitalikButerin) November 15, 2022
FTX’s bankruptcy proceedings are taking shape and it is likely that some of the more than one million creditors will also declare themselves insolvent in the coming days.