FTX tapped into customer accounts to fund risky bets, setting up its downfall
&gt; Alameda’s CEO is Caroline Ellison, a Stanford University graduate who like Mr. Bankman-Fried previously worked for quantitative trading firm Jane Street Capital. Alameda is based in Hong Kong, where FTX was headquartered before relocating to the Bahamas last year.<p>Are the folks at Jane Street making money because they are smart, or because they use that perception to perpetuate some scam?<p>I interact with a lot of Harvard kids. Some of them are from Long Island, they know dads who work at that Republican&#x27;s hedge fund. They are smart kids. They have good cognitive gifts.<p>But not once - not from word of mouth, or directly from them, or someone, ever, anywhere - have I heard a common sense way these guys make money due to intelligence, instead of due to a scam or due to luck.<p>It is really frustrating. So much human potential wasted on chasing the dollar sign. They are in denial that it is scams.<p>It has always been scams. Why is this so hard to believe? Why in the absence of any positive evidence, like &quot;oh here is our genius but nonetheless expired&quot; trading strategy, which anyone could have furnished in the last two decades, they agree, oh it must be real?<p>The simple answer seems, because if you believe it to be real, you can be this specific kind of Harvard + New York + &quot;X&quot; kid - and seriously, they are all cut from the same jib, superficially and inside their character, it tarnishes the institution - and you can do this scam and pocket your change and eat dim sum with 20 people on the weekends and have a skinny girlfriend and buy a condo. You can do something pretty meaningless with your life in exchange for the burn out.<p>This scam life lets 20 year olds not hear from their horrible parents that burned them out and gave them no meaning. Eventually they turn 30 and hope that a decade went by without a crash, and then life decides for them to sell before the ponzi collapses. Like you have a baby with your skinny girlfriend and you buy the condo and great, you sell, and it happens to be well timed!<p>I fucking hate Jane Street, I have hated them since I&#x27;ve known the assholes who intern there, and I don&#x27;t know why this Bankman-Fried guy got such a big pass for scamming literally millions of people, and why this Caroline girl isn&#x27;t going to be sent to jail, and it&#x27;s frustrating because you can actually tell! You can predict this from when these kids are 20!