👁️ Beggin'-Ass Bankman-Fried, Pandering for a Trump Pardon

The media tour is much sadder this time. Also a huge crypto hack, AI brain rot, and a whole lot more.

If there’s one uncontroversial thing you can say about Sam Bankman-Fried … well, actually, there are a lot of those, starting with “he’s guilty as fuck’” and “he’s a pathological liar.” You wouldn’t exactly get a lot of dissenting opinions there, unless you were polling Yale Law professors, alleged pedophile cops, or his own parents.

But one really, really obvious thing is that SBF loves to talk. That’s how he wound up giving dozens of interviews before his trial - interviews which hilariously kneecapped his own defense team.

Now he’s at it again with a recent interview with the New York Sun, and Twitter posts furiously glazing Elon Musk’s DOGE. Just as he thought he could blab his way out of fraud back in November of 2022, SBF now is pretty obviously trying to talk his way into a pardon from Donald Jonald Trump. Below you’ll find a roundup and analysis of highlights from the Sun interview.

It’s hilariously pathetic, since he again has to work against one of this own previous tactical lies - the campaign finance fraud that, in part, concealed his contributions to Republicans to help him present himself as a feel-good lib do-gooder. This fraud helped make him a high-profile punching bag for right-wing media figures back in 2022, and they largely still see him as aligned with the Clinton Cabal, particularly through Michael Kives and K5. If Trump has thought about Bankman-Fried *at all* over the past few years, this is certainly his own vague, addled impression, making an SBF pardon incredibly unlikely, and Sam’s sudden rightward shift even more obvious sociopathic theater from a man with no moral center at all.

Still, you can sense there’s some weird coordination going on behind the scenes of his new prison interview with the far-right and proudly Zionist New York Sun (whose British owner has also bid to buy the Telegraph). The Sun reporter sets Sam up to talk about his rightward shift, and then to run through his still-absurd defense claims that basically boil down to “I didn’t do it.”

The good news is there is absolutely zero political upside in a pardon for Trump, and that’s why the President does most of what he does.

You’re telling me he’s a Republican now? This is the first I’m hearing of it. Wait, who again? Oh yes, I love Blankman, the Wayans brothers are tremendous friends of mine. White Chicks is a classic.

First, some news.

Lazarus hits Bybit With Largest Crypto Hack Ever

A genuinely terrifying social-engineering attack led to the theft of $1.5 billion, now definitively linked to North Korea’s Lazarus Group. It’s the largest crypto hack ever, which also means it’s probably the largest theft in human history.

The attackers tricked multiple exchange officials into signing fraudulent interactions with what’s known as a “multisig,” or a crypto wallet requiring multiple signatures. The industry will be grappling for some time, hopefully very seriously, with how to prevent this type of attack in the future.

However. As my great good friend and FTX victims’ advocate Sunil Kavuri has pointed out, it’s at least a weird coincidence that Bybit was hacked for $1.5 billion, given that Bybit extracted $1.5 billion from the FTX bankruptcy process through rushed pre-bankruptcy withdrawals and a hell of a negotiated settlement. What might that mean? I do not know at all.

LLM Usage Causes ‘Cognitive Atrophy’

Strong recommend for this survey of recent findings on LLM impacts from Erik Hoel at The Intrinsic Perspective. Hoel runs down results including a recent Microsoft study that found LLM users showed declines in critical thinking skills.

Among other nuances: “This negative effect scaled with the worker’s trust in AI: the more they blindly trusted AI results, the more outsourcing of critical thinking they suffered.”

Preview: “I 愛 AI” by Aesthetic Calculations

I’ve just been informed about a wildly intriguing, beautifully-designed collection of “essays, fiction, interviews and visual interventions that reintroduce sex, desire and politics into utopian fantasies of artificial intelligence, via psychoanalysis.” If you’ve read much of my SBF work, you might have detected that I think psychoanalysis is a very powerful interpretive frame for a lot of financial fraud, and I can only imagine the insights it offers on artificial life. I don’t have it yet, but anticipate reviewing it sometime soon.

Do LLMs have “World Models”?

Melanie Mitchell offers a fairly nuanced consideration of the question of whether LLMs include “world models.” This is not a simple question, because a “world model” is ultimately just an arrangement of data. One of the interesting framings Mitchell offers is that LLM world models are “emergent” features of their data sets: that their data allows them to respond as if they knew something about the world, even if they don’t actually “know” anything.

As a subset of world models, I don’t think that LLMs that generate video have models of physics, because that’s simply not contained in the visual data they process. But this is still at least a vastly more interesting and fruitful question than “Can LLMs develop consciousness?” Which has a very simple answer: no they can’t, and also the question is a category error.

Tesla’s Huge P/E Makes Musk Politically Vulnerable

Hamilton Nolan has an interesting thought about the current rising wave of extreme antipathy against Elon Musk, whose last defenders are staging a doomed rearguard action against the rising awareness that he is an incredibly weird, cognitively impaired wannabe-Boer Nazi whose incompetence is destabilizing the government while he’s busy using IVF and a network of surrogates to breed an army of neglected children.

Elon’s nosediving reputation and the incredibly frothy price-to-earnings ratio of Tesla stock together create a massive vulnerability for the quote-unquote “world’s richest man.” As Nolan puts it, “Any company whose value is this dependent not on its balance sheet but instead on a shared popular narrative is unusually vulnerable to narrative shifts.”

A narrative shift on Tesla, which didn’t result from falling sales but might well follow from DOGE absurdity, could cost Elon many many billions in notional wealth, incredibly fast.

CFPB Drops Suit Against Deceptive Payday Lender SoLo

The “crime is legal” era under Donald Trump is going to result in a lot of working-class people getting robbed by finance bros. The now-basically-dead CFPB dropping its suit against the payday lender SoLo is a prime example. A May 2024 filing accused SoLo of deceptive practices in advertising its loans as “zero interest,” when in fact “many loans originated on the SoLo Platform carried an APR in excess of 300% (treating the tip and donation properly as finance charges).”

Donald Trump thinks that’s fine, I guess! Just call everything a “donation” and it’s fine. The suit has been dropped, with prejudice according to the National Consumer Law Center, meaning that it can’t be re-filed later.

While we’re on the subject, let’s not forget that Trump is also giving $5 billion in prospective overdraft fees back to big banks. That’s exactly what his supporters voted for, I’m sure.

SBF’s Post-Conviction Apology Tour Begins

Sam Bankman-Fried spoke to the New York Sun for 45 minutes on Tuesday Feb 18, the call chopped up into 15 minute chunks per MDC Brooklyn rules. You can listen to the whole thing above, but frankly very little of it is worth your time - more than half is a retread of the same exact shambling self-exoneration Bankman-Fried has tried to sell to various prospects for two and a half years now.

The latest target of his flimsy sales pitch? Donald Trump.

It’s clear that the right-wing Sun is angling to turn Bankman-Fried into some kind of cause celebre on the right, after he was held up as a nefarious symbol of Democratic corruption. It’s truly bizarre.

For instance, the interview is introduced with a reference to Danielle Sassoon’s resignation after being ordered to dismiss corruption charges against NYC Mayor Eric Adams. The extremely Trumpy Sun seems to want this to be a ding against Sassoon, and in turn evidence for overturning Sam’s conviction - but Sassoon herself is quite right-wing, a Federalist Society member, making her decision to stand up to Trump’s meddling seem more ethical, not less.

Sam plays into this, also drawing parallels between he and Trump’s shared (mis)treatment by Judge Lewis Kaplan, describing courtrooms as “mini dictatorships, these little fiefdoms … If the rulings don’t make sense, they don’t make sense, it’s sort of a monopolistic system.” When “career advancement for law enforcement” is at stake, it “blows everything out or proportion.” (It’s unclear what “proportion” would mean in his case, since we’re talking about one of the largest financial frauds in American history.) This analysis is of course flatly wrong (Sam himself is in the middle of an appeal), wildly self-serving, covertly anti-democratic - and certaintly tailored to appeal to Trump’s sense of victimization.

This is frankly a smart way to angle for a pardon while drawing attention away from party politics. Sam also leans into the genuine oversentencing of Ryan Salame, who got 7.5 years for campaign finance charges in a thoroughly scuffed arrangement. Bankman-Fried contrasts Salame’s sentencing with the shorter sentences of his three cooperating co-conspirators, “all of whom were sort of on the other side of the aisle” - which seems like a scrap of new insight, since I would not have assumed that Gary Wang was a liberal Democrat.

Sam signals that he was already part of the post-Biden rightward “vibe shift,” even before going to prison. “I viewed myself [circa 2020] as center-left, and that’s not how I view myself anymore, and it’s not how I came to view myself by 2022.” He essentially blames his run-ins with Gensler’s SEC for turning him against the Democrats, and says he’s “become more sympathetic to the chainsaw” in dealing with government, and specifically references the SEC’s guilt in “stymieing innovation.” Again, the irony and blindness here are thick: Bankman-Fried still hasn’t absorbed that his own real “innovation” was crime.

Sam makes sure to explicitly spell out that “I had been giving a lot more to Republicans than had been previously thought, that I had been giving to Republicans a lot more than had been public.” Of course, the incredible irony here is that this was misperceived because Sam Bankman-Fried engaged in campaign finance fraud to cover up his donations to Republicans. (Even though they never went to trial, these charges were treated as proven for the purposes of his sentencing.)

Remember that this is the guy who claimed he had offered Donald Trump $5 billion not to run for President again. On the one hand, this flip-flop is obviously craven tactics, and hey, on some level who can blame a guy for trying to get out of a 25 year prison sentence? But more deeply, I think it just confirms what Kelsey Piper at Vox got the best evidence of: Sam Bankman-Fried doesn’t actually believe anything. He never has. His liberal ethics were performative, and so is whatever he’s trying to signal now.

Really, Sam Bankman-Fried barely even exists. He is an algorithm that seeks money and approval. And that’s strikingly on display in the interview, the only element that makes it a little worth listening to: There’s absolutely no emotional acknowledgment that he’s in prison for most of the rest of his life. The tone is no different than if he were speaking from the Alameda offices in 2019. It’s subtle, but it’s chilling.

Sam spends the second half of the interview on some boring ol’ bullshit: reiterating his absurd claim that he never committed fraud. He repeats the phrase “run on the bank” a half-dozen times, insists that the withdrawal pause was just a “liquidity crisis” that would have been fine: “We started doing the same thing a bank would do, which is Alameda started selling off all of its investments to generate cash.”

This is a classic SBF lie: one that attempts to cover one crime by brazenly admitting to another. Why are you selling off Alameda’s assets to fulfill withdrawal demands on FTX? Well, the answer is because Alameda had already stolen the money. It’s still infuriating how either a) actually stupid or b) shamelessly willing to seem stupid Sam Bankman-Fried is. He still seems to genuinely not understand that letting Alameda use customer funds was massive fraud.

Sam also performs outrage that the bankruptcy estate has now located $15 billion in assets after claiming the money was all gone. Yes, you evil little dweeb, they had to spend years on lawsuits and pressurre to claw back political donations and sell off assets you purchased with customer funds without consent.

Asked what is greatest regret is, Sam says it’s that “I backed down from a fight in Novemer of 2022, and I should not have let Sullivan & Cromwell” declare bankruptcy.

This was hauntingly evocative of the recent Ziz affair: Ziz’s ethics explicitly entailed an injunction to “never back down.” And like, maybe backing down - actually admitting for once that he was wrong and had failed - was the only thing Bankman-Fried actually did right.

If he had taken the Zizian Rationalist path of zero compromise, how much worse off would victims have been? (Also notable in this context, one of the few institutions that has actively fought against any kind of clawback of FTX funds is the Center for Applied Rationality, which faught the clawback suit from the bankruptcy estate. That clawback has now been dismissed.)

Sam also again touts his charitable donations - many if not all of which we now know were fraudulently funded out of customer funds and were ultimately returned. Self-congratulatory even from prison, he says thought in "ludicrously large terms, billions of dollars.” Except he never actually had “billions of dollars” available for those donations. He simply hallucinated it.

When asked What He Misses Most, Sam doesn’t say it’s his brother, family, or friends (he barely had any), but “being able to Google things” and to work. “The days go by in pretty undifferentiated fashion … I’m used to being able to dedicate myself to work, and there isn’t much to work on here.”

Finally, SBF reveals a couple of procedural details: Sam’s appeal is still ongoing, and according to him there may be oral arguments within three to six months. And he might be on the verge of being sent to prison in California, which he still sounds strangely reluctant about.

It seems quite clear that, for whatever twisted reason, he’d rather be in awful jail conditions at the MDC than in a nice white-collar prison … that’s also thousands of miles closer to his parents.