This poll https://forms.gle/5yLeSZhNfs7fE5Vq6 asks participants: "What do you believe was the probability that SBF committed willful fraud in the FTX collapse?
This is meant to measure the community's current beliefs. Please respond to the poll if you're interested.
Resolution
In 1 year (November 2023), I will create another instance of the same poll. Resolves to the average (mean) poll response at that time.
Motivation
In the immediate days after the FTX collapse, a lot of people have quickly concluded that it was willful fraud (e.g. that FTX intentionally loaned out customer deposits which they had committed not to). With the limited information available early on, I believe there is substantial but far from conclusive evidence in favor of this, and that the evidence and information is rapidly changing, and that many people are jumping to conclusions too quickly. You can find a copy of a post I made on this topic at https://manifold.markets/post/in-defense-of-sbf#jIGvMdkFDKDltmegirwJ tl;dr: FTX's failure to hold customer deposits as fully backed deposits seems like it could very plausibly be a combination of bad judgement, terrible accounting practices, and mistakes rather than fraud. I'm not claiming it's likely, just claiming that it's not beyond a reasonable doubt.
This market is an attempt to quantify the degree of certainty the community has on this question. Many people have been acting as if it is basically 100%, while a seemingly smaller minority believes it is substantially less. This is a type of prediction quesiton, and of course we can resolve different predictions by making a market on it.
Notes
Poll responses must be honest. Do not attempt to manipulate the poll - if I suspect manipulation then I reserve the right to restrict the poll to reputable Manifold users or resolve N/A.
I am aware that this poll would likely be highly subject to selection bias. I am considering some ideas to mitigate this in another variant of this question; let me know if you have suggestions.
Poll means a literal poll where you answer with a probability, it does not mean a market.
I chose 1 year somewhat arbitrarily. I could also create a version of this that settles when I or the community judge that no more significant evidence is likely to arise.
Related
@NathanpmYoung Agreed, I also mentioned concern about selection bias earlier.
One thing that potentially helped with the current poll is that it was featured so that anyone on Manifold who was interested in the subject had a chance to see it and respond, instead of only people who were already following the market.
@NathanpmYoung The intent for this question was a poll open to anyone, as per usual Manifold poll practice. If you have ideas for what sort of select group might give better results, I'm interested in hearing them.
@NathanpmYoung That would be a potentially nice feature but I don't think it makes a huge difference - the poll here is already getting a decent number of responses, and I can gather more information this way than with a Twitter-style poll.
@jack What's the current mean? Also naaah it will get so many fewer responses. @Austin can you build a little app for taking polls in comments?
@NathanpmYoung There are two common ways I've seen to do polls like this that are lighter weight and don't require new Manifold features:
Poll by liking comments: https://manifold.markets/IsaacKing/at-the-beginning-of-2023-will-manif
Poll by embedding a 3rd party website poll: https://manifold.markets/Sinclair/which-hogwarts-house-is-the-best-po
But I'm not convinced getting more responses improves poll accuracy. In fact it might make it worse. I think to help mitigate selection bias, it would be better to get a random sample of the Manifold community (probably limited to those with some familiarity with FTX), and poll them.
I have committed not to reveal the current mean until the current instance of the poll finishes at the end of January.
Firstly, every question should have a wiki for info and a way to tip people who add it.
Here is my case for about .92
I don't know what the definition of fraud is, but SBF allowed money which customers had specifically earmarked to not be risked to be risked. And it was $8bn. That's not an amount you can do by accident. What's more Ellison's testimony said they were doing this longer than we previously thought. How can we argue at this point that this either wasn't fraud or wasn't willful?
This is the current situation, which is perhaps an average of 74%. I don't like this but I think that number is only gonna go down.
I just found SBF's intended congress speech, which puts me ever further into the sympathetic camp: https://www.forbes.com/sites/stevenehrlich/2022/12/13/exclusive-transcript-the-full-testimony-sbf-planned-to-give-to-congress
@NathanpmYoung There is a poll today - not for this market, but for /jack/how-much-do-we-believe-sbf-committe
You can respond to the poll here: https://forms.gle/5yLeSZhNfs7fE5Vq6
Here's a poll to measure the community's current beliefs - if you are interested please fill it out!
https://forms.gle/5yLeSZhNfs7fE5Vq6
(This poll is not going to be used to resolve the market - that will be by another poll in November 2023.)
The trial, assuming there is one and it begins as scheduled, will be at its early stage when the market closes. By then, either SBF will have pleaded guilty or evidence and testimony will start piling up during trial. I'd be surprised if poll response then is not over 95%.
@NicoDelon Good point. I also created another market that will run until after his trial:
I sense stuff like this, if true will move some people who were at a 10 or a 9 to a 9 or an 8.
@NathanpmYoung I think it's consistent with what SBF has been saying all along, but it's inconsistent with what the bankruptcy team is saying, and they seem to have more reliable accounting.
I don't think FTX US being solvent (or even FTX customers being made whole) significantly reduces the evidence that customer deposits were used to buy assets other than as directed by the customers, while concurrently FTX was claiming that customer deposits were still their own money and not FTX's. The fraud part wasn't where the gambles lost, it's where they gambled with customer deposits at all while saying they weren't.
I don't think it's surprising that SBF is kind of missing the point on this, given that the point puts him in prison.
I keep forgetting this will be resolved by poll not some weird average of the market price or something, shoulda bid at 86 t'other day
It actually seems quite consistent with what I previously expected for the "incompetence and having zero ability to do proper accounting" hypothesis. Certainly he lied about SBF and Alameda being at arms length, but I thought that was already well known.
Completely normal to “loan” four billion to insiders and then go bankrupt 🤔
“Paper Bird” = paper wealth embezzled to bid on twitter from a deeply bankrupt company (unconfirmed)
SBF seemingly being brutally honest in a lot of this discussion - a lot of things he's saying probably look terrible to most people. And this is what he says about customer deposits (in the "On what happened" section) - so far consistent with what he's said before, probably more evidence will come out over time to either back or contradict this story:
Hitler spent his trial in Munich giving speeches and getting a very light sentence. One would suspect the judge will be similarly friendly to SBF, with a very “connected” prosecutor just happening to make major mistakes, and even a DC venue. Not crazy to see a get out of jail free settlement or friendly jury and incompetent trial.
That said, a few B could have been lost through poor internal controls and Alameda lying to Sam, but the evidence of the amount of losses, six months of cover-ups, and his behavior make it very clear it was fraud.
He’s a great marketer for a reason, and my guess is you are smart enough to look past the motivated reasoning. The later public statements are obviously fraudulent and the activity went vastly far beyond some accidental early mistake.
@Gigacasting I'm 80% sure this won't happen. But I think the community vote just won't be that damning. Few of us are gonna say 100% and then many more people will give lower values.
@NathanpmYoung I think people will say 99% if the evidence supports it. I could run an experiment asking about say Enron for comparison.
@NathanpmYoung Theoretically the market prediction now, or at any given point in time, should match the poll results at the same time - if not, it means people have irrational beliefs
"In a video meeting with Alameda employees late Wednesday Hong Kong time, Alameda CEO Caroline Ellison said that she, Mr. Bankman-Fried and two other FTX executives, Nishad Singh and Gary Wang, were aware of the decision to send customer funds to Alameda, according to people familiar with the video."
it seems like this demonstrates that there was a known decision?
@tcheasdfjkl thanks for the link, now that I think about it I did see this mentioned but I also thought sbf was still denying it was intentional even after that date. I'm confused now whether they knew this was in violation of their user agreement.
I think I would expect that if they thought this was allowed then more than four people would have known about it at some point, given that it was a lot of money? like it would come up at some point in company strategy discussions and someone at some point would go "uh, what". instead we got a situation where the legal/compliance team resigned once the scandals started.
@tcheasdfjkl If they didn't think what they were doing was fraudulent, then it's not willful. If they for example kept it from the legal/compliance team because they were afraid of leaks (which is what they claimed, I think) and not because they were afraid it was illegal, that's not willful fraud - more like extreme negligence. But if they kept it form legal/compliance primarily because they thought it might be illegal, that seems like willful fraud.
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