Sam Bankman-Fried, CEO and founder of FTX, describes what happened between the Subreddit Wall Street Bets and hedge funds around the stock of GameStop this week. In this episode, he covers:
- what happened with the stock of video game retailer GameStop this week
- what that says about how to value a stock
- how the traditional financial establishment reacted
- how the events in GameStop this week are similar to the way crypto markets operate
- how a crypto financial system could affect the ability of investors to do what the hedge funds did with GameStop — shorting more shares of the stock than actually exist
- what led to FTX listing for tokenized versions of GameStop, Blackberry, AMC and Nokia, as well as a tokenized index fund of Wall Street Bets stocks
- how the tokenized stocks and index work on the back end
- why Robinhood restricted customers from purchasing shares in GameStop on Thursday
- what the inspiration was for FTX
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Episode links:
Sam Bankman-Fried: https://twitter.com/SBF_Alameda
FTX: https://ftx.com
Roundups of what happened with Gamestop:
NYT: https://www.nytimes.com/2021/01/27/business/gamestop-wall-street-bets.html
Vox: https://www.vox.com/the-goods/22249458/gamestop-stock-wallstreetbets-reddit-citron
Early Wired story: https://www.wired.com/story/gamestop-stock-wall-street-bets-short-squeeze/
NYT analysis: https://www.nytimes.com/2021/01/28/technology/gamestop-stock.html
Sam on what can determine an asset’s price: https://twitter.com/SBF_Alameda/status/1354790766313234432?s=20
Chamath Palihapitiya on CNBC discussing Gamestop — defending individual investors: https://www.cnbc.com/2021/01/27/chamath-palihapitiya-closes-gamestop-position-but-defends-individual-investors-right-to.html
Videos: https://www.cnbc.com/video/2021/01/27/investor-chamath-palihapitiya-the-gamestop-story-is-pushback-against-wall-street-establishment.html https://www.cnbc.com/video/2021/01/27/billionaire-investor-chamath-palihapitiya-on-gamestop-surge-and-rise-of-retail-investors.html
Gamestop price gyrations: https://www.cnbc.com/2021/01/28/gamestop-reverses-losses-and-surges-another-30percent-in-the-premarket-to-450-as-mania-continues.html
How many shares of GME are shorted: https://isthesqueezesquoze.com
FTX lists GME for tokenized spot and futures trading: https://www.theblockcrypto.com/linked/92756/ftx-lists-gme-stock-for-tokenized-spot-futures-trading
FTX’s Wall Street Bets tokenized index fund: https://twitter.com/SBF_Alameda/status/1354790817060143114?s=20
Robinhood customers only being able to sell, not buy GME when Robinhood’s revenue biggest revenue source is sending order flow to hedge funds: https://www.cnbc.com/2021/01/28/robinhood-interactive-brokers-restrict-trading-in-gamestop-s.html
Matt Levine of Bloomberg on GameStop: https://www.bloomberg.com/opinion/articles/2021-01-28/knowing-when-to-sell-gamestop-stock-at-the-top-is-impossible?sref=m9L277rN
