Going Infinite: The Rise and Fall of a New Tycoon

“Sam explained that he was trying to decide whether to simply pay off the $9 billion Bahamas national debt himself, so the country could fix their roads and build schools and so on.”

The sheer magnitude of Sam’s gesture underscores the immense wealth he accumulated through his crypto ventures. It speaks to his financial capabilities, emphasizing that he possesses the resources to influence entire countries’ financial situations. The passage also raises questions about Sam's motivations and the practicality of such a proposition. The notion of a single individual attempting to eliminate a nation's debt is highly unconventional and potentially unfeasible. Sam’s contemplation of this idea might indicate a certain level of naivety or a belief in the near-infinite possibilities of wealth, which aligns with the earlier mentioned concept of “infinity dollars.” It highlights his unique perspective and his willingness to entertain audacious, if not impractical, notions.

“Still, he was worried that if he told Forbes everything, they might tell everyone that he was as rich as he thought himself to be. ‘I didn’t just send them the number: here’s what I’m worth,’ he said. ‘It would set the wrong tone. The number was too big. If it comes out in Forbes that I’m worth one hundred billion dollars, it’s going to be weird and it’s going to fuck things up.’ He hadn’t sent them the list of the one hundred or so businesses he’d acquired over the previous two years, for example. His story might be fantastic, but he needed it to be believable.”

Sam was aware of the public perception that accompanies immense wealth. He was hesitant to reveal the full extent of his fortune to Forbes, suggesting a level of self-awareness about the potential consequences of such a disclosure. Sam’s decision not to disclose that he had acquired about a hundred businesses over two years to Forbes was thus strategic, suggesting that Sam was conscious of the delicate balance between appearing successful and maintaining relatability despite the rapid expansion and diversification of his business empire. The passage also reveals Sam's self-perception. He “thought himself” to be incredibly rich, emphasizing the subjective nature of wealth.

“Natalie’s job became both simpler and more complicated. Simpler, because basically everyone now wanted to talk to Sam, and Sam was game to talk to anyone—so long as he could play a video game while doing it. Sam went from being totally private to being a media whore. He was as happy to yak for an hour in a completely unguarded way with the reporter from the Westwego Crypto Daily as he was to speak with the New York Times.”

The passage highlights a significant change in Sam’s behavior. He has transitioned from being a private and relatively discreet individual to someone willing to engage with the media openly. This shift is noteworthy as it signifies the growing public interest in Sam’s wealth and business endeavors. Sam playing video games during these media interactions reveals his nonchalant approach: He was willing to interface with journalists but remained distracted and disengaged even when talking to prominent publications. This passage also highlights the diversity of media interest in Sam and the need for careful management of these conversations given their increasing frequency.

“‘Yup,’ said Sam, to whatever Anna Wintour was saying. He could still hear her through headphones. Unless she watched his eyes, she had no reason to think that he wasn’t paying attention. Sam didn’t want to seem rude. It was just that he needed to be playing this other game at the same time as whatever game he had going in real life. His new social role as the world’s most interesting new child billionaire required him to do all kinds of dumb stuff. He needed something, other than what he was expected to be thinking about, to occupy his mind. And so, oddly, the more important he became in the eyes of the world, the more important these games became to him.”

The passage suggests that Sam used video games as a form of escapism and a way to cope with the pressures and demands of his newfound celebrity. The passage reveals that the more important he became in the eyes of the world, the more these games became important to him. At the same time, Sam’s distracted and multitasking behavior depicts him as a “child billionaire,” a characterization Lewis insists on despite the fact that Sam was an adult man.

“From the widespread belief in God, and Santa, Sam drew a conclusion: it was possible for almost everyone to be self-evidently wrong about something. ‘Mass delusions are a property of the world, as it turns out,’ he said. He had to accept that there was nothing he could do about this. There was no point in arguing with other kids’ belief in Santa Claus. Yet he didn’t feel the slightest need to pretend to agree. He simply came to terms with the fact that the world could be completely wrong about something, and he could be completely right. There could be a kind of equilibrium in which everyone in the world could remain wrong and he could remain right, and neither side would even try to change the other’s mind.”

The widespread belief in God and Santa Claus are two examples of deeply ingrained beliefs in society, often tied to tradition and cultural norms. The passage portrays Sam being aware of the prevalence of collective beliefs, accepting differing opinions without the need to pretend agreement, and maintaining a strong sense of self-assuredness in his own beliefs, even when they differed from widely accepted norms.

“Childhood had given him math, at which he’d been very good but not great. Childhood had given him various strategic board and card games, at which he’d also been very good but not great. The Jane Street traders had tested his mind for qualities it had never been precisely tested for. And it appeared to Sam that God had tweaked trading in various ways, or at least games intended to simulate trading, to make it different from math and board games. Each of those tweaks had made the games more congruent with his mind.”

Sam’s childhood experiences contributed significantly to his intellectual development. His proficiency in math, though not exceptional, suggests that he had a solid foundation in logical and analytical thinking. Additionally, his proficiency in strategic board and card games indicates a capacity for strategic thinking and decision-making. This passage ties to the theme of Games, Puzzles, and Probability as Shapers of Worldview.

“All those people you might have saved if you had become a banker and given away your money would die. Thus anyone with the ability to go to Wall Street and make vast sums of money had something like a moral obligation to do so—even if they found Wall Street faintly distasteful. ‘Many lucrative careers are really pretty innocuous,’ said MacAskill, helpfully.”

EA posits that there is an ethical tension between personal preferences and the greater good. Choosing a lucrative career might require individuals to sacrifice their personal preferences or even overlook their distaste for certain industries, such as Wall Street. The passage advocates the idea that those who have the capability to accumulate wealth should not only consider it a privilege but also a responsibility to contribute to society, especially by redistributing their wealth in ways that can save lives or have a significant positive impact.

“On one of those ‘March of Progress’ charts that dramatized the evolution from ape to man they represented perhaps the penultimate stage of Financial Man: hair mostly gone, nearly upright, but still carrying a club on their shoulder, which they used to impose a greater taste for hierarchy on the more egalitarian younger traders. The younger traders were full Homo sapiens. They’d been harvested from the tiny slice of the population identified early in life as having a gift for higher-order thinking. Many had gone to math camp in high school. Almost all had excelled in computer science or math at MIT, Harvard, Princeton, or Stanford. They were less socially adept than the older traders, because they could afford to be.”

The passage highlights a significant generational divide in the financial world. The “March of Progress” chart, a visual representation of human evolution, here becomes a metaphor describing the older generation of traders as being in a transitional phase from more primitive forms, with hair mostly gone and still carrying a club on their shoulder. Though they have evolved, they still rely on older, more hierarchical methods of trading. In contrast, the younger traders are portrayed as evolved. The passage also touches on the trade-off between social skills and technical expertise. The younger traders are described as being less socially adept, an acceptable trade-off given their exceptional mathematical and technical abilities.

“The difference between what happened at Jane Street and what happened on, say, a Wall Street trading floor in the 1980s was one of degree rather than of kind. Data had fully replaced feel. The standard procedure at the firm was for the traders to watch the machines trading out of the corner of their eye while they ran little research projects. (The trading occupied roughly the same place in Sam’s attention that video games later would.)”

Since traders watch machines trading while running research projects, trading occupies only part of their attention, as their focus is divided between monitoring the automated trading systems and conducting research. This echoes a similar aspect of video games; moreover, both trading and gaming feature excitement and competition. The connection reflects the advanced technological environment in which trading occurs.

“He hated the way inherently probabilistic situations would be interpreted, after the fact, as having been black-and-white, or good and bad, or right and wrong. So much of what made his approach to life different from most people’s was his willingness to assign probabilities and act on them, and his refusal to be swayed by any after-the-fact illusion that the world had been more knowable than it actually was.”

Sam disdained simplistic interpretations that tend to view inherently complex and uncertain situations as clear-cut or binary. He rejected the idea that the world can be neatly categorized into dichotomies, instead recognizing that many real-world scenarios are inherently probabilistic. The passage also implies a degree of cognitive resilience on Sam’s part. He could withstand the pressure to conform to hindsight biases and maintained his commitment to probabilistic thinking, which can be intellectually challenging in a world that often seeks straightforward answers.

“An odd company from the start had just become even more odd. The people inside were those most able to tailor their thoughts and feelings to those of its creator.”

The phrase “tailoring their thoughts and feelings” implies a psychological alignment: Employees not only conformed to the company's objectives but also assimilated the founder's ideology, emotions, or worldviews. This alignment led to a cohesive yet homogenized organizational culture. The passage highlights the significant influence of Sam, whose vision and personality played a central role in shaping his company's culture and the behavior of its employees. This influence created to a unique, insular, and eccentric working environment.

“‘What is needed is an electronic payment system based on cryptographic proof instead of trust,’ wrote Satoshi. Trust, or the need for it, bothered Satoshi, whoever he was. His paper doesn’t mention the 2008 global financial crisis, but his invention was obviously a response to it. If Bitcoin had its way, banks and governments would no longer control money. Bitcoin could be owned and moved without the need for a bank. Its value could not be eroded by governments. It didn’t require anyone to trust anyone or anything, except, of course, the integrity and design of the computer code. It was at once a plea for sound money and an appeal to mistrust. It was both financial innovation and social protest. Crypto was like the friend you’d made only because you shared an enemy. The sort of person drawn to it, at least in the beginning, was the sort of person suspicious of big banks and governments and other forms of institutional authority.”

Lewis argues that Satoshi’s conceived Bitcoin in response to the 2008 global financial crisis, questioning the world’s reliance on intermediaries like banks and governments and attempting to create a more secure and transparent system. The 2008 crisis exposed weaknesses in the traditional financial system, and Bitcoin emerged as both a “plea for sound money” and “an appeal to mistrust.” This duality reflects its role as a financial innovation challenging the status quo and a form of social protest against institutional authority. Bitcoin can thus be seen as a novel approach to wealth management and a manifestation of skepticism toward traditional financial systems.

“It was as if a wildcatter had accidentally built his house on an oil field: Sam hadn’t even really wanted to run a crypto exchange. He’d built a casino that offered gamblers the chance to make bets bigger than their bank accounts justified, at seemingly no risk to the casino or to the other gamblers, and it was exactly what the crypto world wanted […] Sam’s choice of location, also accidental, was perfect too […] Hong Kong was like a chessboard with a voice embedded in it to shout rule changes in the middle of every game. The Hong Kong regulators gave a crypto exchange cover to do pretty much whatever it wanted to do but changed the rules often enough to keep it interesting.”

This passage highlights the element of serendipity in trading success, comparing Sam to someone involved in the exploration and drilling of oil and natural gas wells. These individuals are known for taking substantial risks by drilling in unproven or unexplored areas with the hope of discovering new oil or gas reserves. The term “wildcatter” suggests a pioneering spirit and a willingness to venture into uncharted territory in pursuit of potentially lucrative finds. The passage also equates Sam’s crypto exchange to a casino. It suggests that the crypto market was drawn to high-risk, high-reward speculative trading, and Sam’s platform accommodated this appetite. Finally, the seemingly contradictory reference to the chessboard echoes the fact that Sam loves games with elements of uncertainty and surprise.

“Selling what were in effect shares in itself to US retail investors on its own new US crypto exchange, Binance lifted the biggest middle finger to the US regulators. In the bargain, it juiced the value of BNB incredibly.”

Lewis uses the expression “lifted the biggest middle finger” metaphorically to emphasize that Binance openly challenged or disregarded the regulatory authorities in the United States. By taking this bold action, Binance defied US regulators and increased the value of its cryptocurrency Binance Coin (BNB) significantly. This passage underscores the tension between cryptocurrency exchanges and regulatory authorities, as well as the potential impact of public gestures of defiance on the price of associated cryptocurrencies, which often rose or fell based on public perception and popularity rather than inherent value.

“The only sight that the FTX employees all wanted was of their boss. Status in the company was measured by proximity to Sam. Even from their jungle huts people jockeyed for a view of him. The architects schemed the main building with glass walls and mezzanines that offered unlikely interior views of Sam. ‘It gives you an opportunity to catch glimpses of Sam no matter where you are sitting,’ said Ian.”

Employees at FTX had intense fascination and reverence for their boss, Sam Bankman-Fried. Employees considered proximity to Sam prestigious, making direct physical closeness and even simply having a visual line of sight to him sought-after status symbols. This conveys the idea that Sam was not just the CEO of FTX, but also turned the company into a cult of personality. The company’s structure and design were influenced by this devotion to Sam, symbolizing his role and presence as a charismatic leader.

“One of the first things I noticed about Sam Bankman-Fried was how easy he was to steal from.”

This quote highlights Sam’s lax and casual nature. Whether due to indifference, naivety, or trust, Sam did not see a need to guard his belongings, which contrasts with the fact that multiple hackers stole money from FTX.

“All three wore short pants, and in the room, for a moment, it felt like nap time for a small class of restless first graders. But then Sam explained what he wanted to talk about: Elon Musk really was going to buy Twitter, but he didn’t really want to pay for it himself.”

The contrast between wearing casual shorts while discussing the serious topic of investing in Twitter is stark: Lewis portrays quasi-children having an adult conversation. The effect casts the conversation about the financial consequences of Elon Musk buying Twitter as emblematic of the unorthodox and immature nature of Sam’s approach to business dealings—one of the many times Lewis portrays the subject of his book as much younger than his actual years.

“The money nearly always came not from FTX but from Alameda Research, which Ramnik and everyone else thought of as Sam’s private fund.”

The fact that money used for various investments and financial transactions primarily came from Alameda Research, rather than FTX, highlights the problematically interconnected nature of Sam's various ventures. Alameda Research was commonly perceived as “Sam’s private fund”—a red flag that calls into question the wisdom of Sam having no oversight in the form of a board of directors at FTX. The blurred lines between Sam’s personal wealth and the financial assets of his various ventures also suggest that Sam had substantial control over the allocation of funds.

“Still, there couldn’t be many other cases in human history of a person his age tossing around dollars in the amounts he was tossing them without much adult supervision, or the usual constraints of corporate life. A board of directors, for instance. ‘It’s unclear if we even have to have an actual board of directors,’ said Sam, ‘but we get suspicious glances if we don’t have one, so we have something with three people on it.’ When he said this to me, right after his Twitter meeting, he admitted he couldn’t recall the names of the other two people. ‘I knew who they were three months ago,’ he said. ‘It might have changed. The main job requirement is they don’t mind DocuSigning at three a.m. DocuSigning is the main job.’”

Sam Bankman-Fried enjoyed a remarkable degree of autonomy and independence. His approach to corporate governance was shallow: He adopted some traditional practices only to avoid scrutiny. Creating a board “with three people on it” as a rubber stamp rather than an oversight body shows Sam’s refusal to have anyone question his decision-making. The main focus of FTX’s pretend board of directors is to DocuSign approval—Sam only made the board as a formality and wanted people on it who would say yes to anything.

“‘It just seems like there isn’t enough money in politics,’ said Sam. ‘People are underdoing it. The weird thing is that Warren Buffett isn’t giving two billion dollars a year.’”

Sam’s statement is a tongue-in-cheek suggestion that the amount of money being poured into politics is insufficient, which is a perspective that contrasts with common concerns about the influence of money in politics. This statement could be interpreted as a commentary on the vast sums of money that circulate in political campaigns and lobbying efforts. Sam’s comment that “Warren Buffett isn't giving two billion dollars a year” reflects his expectation that individuals with significant wealth, like Buffett, should be contributing even more to political causes and philanthropy. It underscores his expectation of substantial philanthropic giving by the ultra-wealthy.

“As he said that, he tossed popcorn in his mouth, in a herky-jerky motion that resembled a clumsy layup. He was shooting around 60 percent, and the popcorn was flying everywhere. He’d failed to catch a dish of warm nuts as they’d hurtled past hum during takeoff, and they too were still scattered all around him. As he’d ordered the political world in his mind, he’d created chaos in the space he inhabited. Finally we landed, and he ran to his dinner, leaving the mess for someone else to clean up.”

Sam’s unconventional way of eating popcorn reflects his nonchalant attitude and a lack of formality. Sam’s failure to catch the dish of nuts implies that his mind is often preoccupied with other matters and that engagement with his own thoughts can lead to lapses in his attention to practical or everyday concerns. Lewis uses Sam’s messy eating as a metaphor for how he manages his life. He may be focused on high-level strategic thinking or decision-making (e.g., “ordering the political world in his mind”), but this leads to disorder and clutter in his immediate environment. The fact that he leaves the mess for someone else to clean up suggests an arrogant degree of detachment or a reliance on others to handle the practical aspects of his life.

“As it turned out, it wasn’t easy to get people to give you $7 billion when you couldn’t explain why you needed it. It was even harder to get people to give you $7 billion when you had to have it right away.”

Lewis employs humorous understatement to convey Sam’s predicament. Up until this point in the book, Sam has treated huge sums of money lightly. Now that he is faced with the prospect of raising billions of dollars from other people on very short notice, he finds that they treat money less casually than he does.

“Sam was right: People don’t see what they aren’t looking for.”

Sam’s character is complex. On the one hand, his capacity to identify opportunities, his willingness to challenge the status quo, and his knack for seeing what others may not, contributed to his success in cryptocurrency as well as traditional finance. On the other hand, by using this understanding to his advantage, Sam exploited the fact that many individuals, including regulators and even some of his own employees, weren’t initially looking for deceptive practices or misconduct within his operations. This allowed him to operate without raising red flags.