What's your favorite crypto writer, Michael Lewis, the former Wall St. bond slinger turned biggest living finance writer of all time. Crypto is a reformation event for the church of capital, a way to clear away years of bureaucracy, become more personal in personal finances, and align the world with the profession's ideals of redistribution, inclusion and equality. And many people consider Lewis an Abrahamic figure because of his role exposing the rot at the center of modern finance most notably through his role as an Abrahamic figure.
And so if I tell you that Lewis has essentially become persona non grata within the world of crypto, it's with a heavy heart. Almost overnight, Lewis' reputation as the virgil of Wall St., the financial crime writer extraordinaire, has tanked - all due to what can only be described as a profoundly ill-advised '60 Minutes' interview on Sunday, which served as the kickoff media event for his latest book.
It should caveat this with a few hugely important details: almost no one outside of publisher Norton or Lewis' circle has read the book, which will be published today, coinciding with the start of Sam Bankman-Fiered's trial, where the fallen magnate is set to plead not guilty to multiple counts of fraud. It is also forgivable that Lewis, like most reporters with direct access to SBF, missed the red flags at FTX. Bankman-Fried was a media phenomenon, a self-made billionaire who stood for capitalism made right - represented by his political donations, charitable commitments and shabby attire.
But Lewis, with his firsthand account and access to the media, has decided to muddy the waters. Bankman-Fried was convicted of causing a series of deaths and was ultimately found guilty. To everyone, everyone is entitled to their opinion, and Bankman-Fried certainly deserves his day in court, but there are matters of fact and lines that simply shouldn't be blurred when writing or promoting non-fiction.
For a writer who built a career, making convoluted financial fraud dead simple, to miss something so fundamental is bizarre, to say the least. If FTX has brought in revenue, it is not being litigated and bringing it up is to miss the enormous fraud-shaped hole in FTX's books. It's enough for a CoinDesk editor to ask me, maybe rhetorically, whether Bankman-Fried has something on Lewis. For this to be a question worth asking, there doesn't have to be an embarrassing photo of Lewis, like, kissing a goat at a Bahamian rave.
On '60 Minutes, Lewis notes that he essentially worked as an advisor for FTX, which raises the issue of potential conflicts of interest. For be fair, this was probably informal, and a result of Bankman-Fried's boundless impropriety - Lewis reportedly met with the wunderkind more than a hundred times, speaking for countless hours over two years. But the idea that Lewis could be a neutral observer is shattered. Some have raised concerns that Lewis may have been and could still be financially ensnared in the web of FTX corporate, a tangle of more than 100 shell companies and subsidiaries.
While regulatory and financial oddities aside, it's clear that Lewis was always destined to write something that'd spin FTX in the best possible light. Bloomberg investigative journalist Zeke Faux notes in his recent book that it was jarring to see his literary hero on stage at an FTX-hosted conference in the Bahamas more or less proclaiming the religiously unkempt Bankman-Fried as capitalism's savior. In a sense, it is the most forgivable case against Lewis for his perceived crimes against journalism. Bankman-Fried failed in his purported mission, but you can still admire the zeal.
It is one thing to present an opinion as fact - like saying FTX would be a going concern if Binance CEO Changpeng Zhao didn't cause a panic run or that SBF simply made he didn't notice an $8 billion hole in the balance sheet. Lewis said he refers to someone who is willing to take risks for the benefit of the world.
With effective altruism, Bankman-Fried's prowessful motivation, I believe, is noble at a small scale and psychopathic when scaled up. Even though it sometimes appears like those in EA are mostly preoccupied with minimizing their taxes, Mosquito nets have been delivered. Lewis seems to be a adherent, or at least considers John-Galt-But-Charitable as a great protagonist. But life is not an Ayn Rand novel, and it appears like the writer has been tricked by a Fabulist. The lowest point of the interview was when Lewis remarked that customer funds went missing due to a criss-crossed banking situation to dispel the idea of outright theft.
I think it's better to leave the possibility of fraud having been committed to the courts to determine the circumstances. The best defense Bankman-Fried has been that he was profoundly oblivious and that FTX was criminally mismanaged for all intents and purposes, if not actually. That Lewis seems willing to speak up for a perennially'misunderstood' man-child with few other public defenders is basically a gamble. He has a well-earned reputation for being a gambler.