In a first post of its kind I wanted to share my thoughts on Michael Lewis’s “Going Infinite”. It tells the story of Sam Bankman-Fried (SBF), disgraced FTX founder currently on trial for multiple cases of fraud. It covers SBF’s story from childhood through June of this year.
Some reviews have criticized Lewis for defending SBF. It could be that I was very aware of the facts going into this book and had previously formed opinions about SBF. However I feel that he describes Sam as almost inhuman. Cold, distant, emotionless all would be accurate ways to describe the image of SBF that Lewis paints. The book left me feeling like I had less in common with SBF than I could have imagined. At one point Sam describes himself as missing a piece of himself where his happiness was supposed to go. I do not feel as if Lewis was paying any lip service to SBF but like I said I may be biased.
An odd child
In the early chapters Lewis details how excruciatingly unattached, uninterested SBF was with any of his classmates. He paints SBF as an antisocial, hollow youth. A child that is judgmental of his peers for believing in something so absurd as Santa Claus. Going Infinite introduces SBF’s only childhood friend, a fellow introvert whose only commonality with Sam is their enjoyment of Magic: The Gathering. It establishes Sam’s love of games with unbalanced rules and unpredictable outcomes, foreshadowing his interest in financial markets. It chronicles his distaste for the humanities, how he preached that it was all subjective and “bullshit”. Act I wraps up with his time at Jane Street, a prop trading firm that was hiring physicists from MIT.
I really enjoy the part about the job interview at Jane Street. That part of the story I had not heard before. It involves bringing in a group of applicants and having them wager these poker chips against each other in a series of games. Any candidate who ran out of chips was sent home. Last remaining applicant got the job.
Early Alameda
Act II picks up right after SBF learns of crypto currency and has the idea along with a few peers to take some of the strategies they employ at Jane Street and build a trading firm in the crypto markets. The idea being that crypto markets were trading 24/7 so they would be able to run their trading algorithms constantly. So Alameda was born.
A non-negligible amount of money goes missing and while all of his co-managers* are worried Sam is completely lax saying the money will probably just turn up. More so, it describes a conversation Sam had where he tells his team they could account for a percentage of the missing money based on a probability model. The other managers shoot down this idea explaining to him that would constitute fraud.
Once again given what happens and the allegations he is currently facing, this is not a flattering statement. It told me that he should have never been near anyone’s money ever. From this account he does not seem to even have a vague notion of what is and is not illegal.
*not co-owners; Lewis mentions that Sam does not want anyone else to own any equity in Alameda. Sam has complete control over everything. Lewis does abuse these kind of footnotes throughout the book taking up almost half a page at times
FTX and the missing client money
After he drives away almost everyone who was willing to work with him at Alameda he needs to raise more capital. He launches a crypto exchange with the intent of being the most law abiding crypto exchange in the world. The back half of the book covers most of FTX’s history. Everything from the stadium naming rights to Tom Brady. From Musk & Twitter to the eventual meltdown.
It talks how people blindly handed over millions of dollars without any due diligence. It also covers how inadequately the company was managed from the inside. Of course the last couple chapters describe the events of last November and all the panic surrounding that.
Most of the later material falls under one of the other criticisms of the book I’ve seen repeatedly. This book does not introduce a lot of new information to the public but rather serves as a compendium for information we’ve already had. Which brings me to my final comments.
If I had to assign a rating it would be 3.5/5. This book does not shine light on any new revelations for those who had followed FTX’s rise or the crypto space in general over the past one to three years. If you are wondering “What was FTX?” or “Who is this Sam Bankman-Fried guy?” I do believe that you could learn a lot from this book. It is very short. Which makes sense given the likelihood it was rushed to meet the start date of the trial. I would recommend this book to a non-finance person who was interested in the SBF trial as I think most of the information covered in the book is probably known by those following the events closely.
If you’ve made it this far in my review thank you for reading. I hope you have found this insightful!
