"It's ridiculous to think that cryptocurrency is on trial. It's individuals who are on trial.”

Sheila Warren, CEO of the Crypto Council for Innovation, an advocacy group promoting regulation of the cryptocurrency industry, expressed her discomfort with the ongoing trial of FTX founder Sam Bankman-Fried, which began on October 3, and the negative public reaction towards the industry. The local media's coverage of the trial, which will span six weeks and address seven criminal charges, is also focusing on negative headlines, a stark contrast to their previous heroic portrayals of Sam Bankman-Fried.

Of course, the trial should focus on the voices of the victims and the specific details of rectifying the damage. However, in the case of FTX, which garnered tremendous fame, what lessons can the industry and victims learn from a perspective that remains focused on individual responsibility?

FTX was once touted as the future of cryptocurrency, and cryptocurrency was seen as the future of currency. FTX, which promised to sponsor college scholarships and fund charitable projects, was able to solidify its longevity by sharing the stage with powerful figures through its relationship with key political donors and lobbyists. The recent books published by two authors who covered FTX's growth and subsequent downfall offer clues to the lessons mentioned above.

Michael Lewis, author of Going Infinite, released on October 3, is a best-selling author and renowned financial journalist known for works like "Moneyball" and "The Big Short." Apple paid $5 million for the rights to his new book, indicating the world's interest in and expectations for his FTX investigation. Zeke Faux, author of Number Go Up, a Bloomberg investigative reporter who also covered the FTX saga, admitted that, like Michael Lewis, he began his investigation by focusing on the founder, Sam Bankman-Fried.

However, while Michael Lewis maintained a sympathetic stance toward Sam Bankman-Fried in interviews, acknowledging that some media outlets had claimed FTX was a genuinely great business, Zeke Faux admitted that he never even considered carefully examining how FTX operated as a business, thus revealing a growing divergence in the direction of their books. Consequently, Going Infinite retains a structure that is not significantly different from what has already been covered in most media outlets, focusing on the founder's individual perspective as an innovator. Meanwhile, Number Go Up introduces more eccentrics from the cryptocurrency industry, exploring the wider context of FTX, from the stablecoin Tether and the so-called Pig Butchering scam, a hybrid of romance scam and cryptocurrency fraud, to a trip to Cambodia, a breeding ground for this type of crime.

FTX was once considered a prime example of innovation. However, the heroic narrative of the innovator, particularly theimmersion in the introduction and departure of the hero, the world has forgotten how to see the completion of the entire narrative. In 1949, Joseph Campbell analyzed biographies of world-renowned figures and concluded that the core of every hero's journey is to acquire some kind of new ability through trials and tribulations, return, and bring about change in the status quo.

In other words, the hero's journey is just a recipe for a challenging system, meaning that the hero must leave the system they belong to, pass through another system, and return with the resources needed to change the system in order to actually change the system. The beginning of FTX, which heralded the start of a huge change, could be considered quite fitting for a potential hero due to the founder's eccentric personality.

He appeared to be a relatively uncouth and odd character in the industry, with a scholarly demeanor, a partially exposed bald head, and a passionate attitude towards effective altruism. His parents were professors at Stanford Law School, and Sam Bankman-Fried, clad in loose clothing while playing video games and talking to investors, effectively instilled the perception of a typical tech genius, fueled by media hype. However, external validation and interest in his ability to establish a new system after experiencing the limitations of the existing system and effectively merging resources from the existing system did not reach the necessary level.

Did FTX possess the resources needed to change the entire system? Before sharing his enthusiasm about the possibilities of a new system, how deeply did Sam Bankman-Fried understand the existing system and consider the points of contact with the new system? If there had been a bit more focused attention and validation on this question, wouldn't the tears of those many victims have been prevented?

As if answering this question, Zeke Faux, author of Number Go Up, introduced the delusion behind Sam Bankman-Fried's cryptocurrency returns mechanism in a conversation with his colleague Levin on Bloomberg's podcast.

"You start with a company that makes boxes… The company can hype up how these boxes can change lives, but nobody knows or cares what the boxes actually do... What matters is that you use that excitement to introduce a way for the company to issue tokens and share the profits, and as that excitement builds, the price keeps going up indefinitely, everyone makes money."

References

FTX founder Sam Bankman-Fried's trial begins 11 months after FTX's bankruptcy… “If all charges are admitted, 100 years in prison”

‘A Galactic Embarrassment’: The Crypto World Is Already Sick of SBF’s Trial

Everybody's Talking About the Wrong Sam Bankman-Fried Book

What Is a Pig Butchering Scam?

Apple’s $5 million book payment shows Sam Bankman-Fried is big business

Going Infinite: The Rise and Fall of a New Tycoon

Number Go Up: Inside Crypto's Wild Rise and Staggering Fall