Going Infinite

Going Infinite Plot Summary

Introduction

In the annals of financial history, few figures have risen so meteorically and fallen so spectacularly as Sam Bankman-Fried. Known for his disheveled appearance, cargo shorts, and untamed hair, he defied the conventional image of a financial titan. Yet by the age of 30, he had amassed a fortune estimated at $26 billion, becoming one of the wealthiest self-made individuals in history. His cryptocurrency exchange FTX grew from nothing to a $32 billion valuation in just three years, while he cultivated an image as the respectable face of crypto and a generous philanthropist guided by effective altruism. Behind the awkward demeanor and mathematical brilliance was a complex individual who navigated life through probability calculations rather than emotions. He claimed to pursue wealth not for personal luxury but to maximize human welfare through calculated giving. His journey offers fascinating insights into the intersection of genius and hubris, the culture of modern finance, and the dangers of unchecked ambition. Through his remarkable rise and catastrophic fall, we witness not just a financial scandal, but a profound commentary on our era's relationship with money, technology, and ethics.

Chapter 1: The Unorthodox Beginning: A Mathematical Mind

Sam Bankman-Fried was born in 1992 to Stanford Law professors Barbara Fried and Joseph Bankman, growing up in an intellectually rigorous household where conventional traditions held little sway. Holidays and birthdays were treated as optional, thoughtful discussions took precedence over emotional expressions, and utilitarian philosophy was a common dinner table topic. This environment shaped Sam into someone who approached the world through mathematical probability rather than conventional social norms. From an early age, Sam displayed remarkable mathematical aptitude but struggled with social connections. In elementary school, he was bewildered to discover that other children genuinely believed in Santa Claus, and later was equally shocked to learn that adults believed in God. These revelations led to his first philosophical insight: "Mass delusions are a property of the world, as it turns out," he would later explain. He concluded that it was possible for almost everyone to be wrong about something while he alone was right. School was a source of perpetual boredom for Sam. Though academically gifted, he found little intellectual stimulation in traditional education. His rebellion against humanities classes began early – he considered literary criticism "subjectivity framed as objectivity" and even wrote a statistical argument against Shakespeare's greatness, calculating the improbability that "the greatest writer" would emerge from an era with such low literacy rates. By eighth grade, he had stopped reading books entirely. His salvation came in the form of games, particularly the strategic card game Magic: The Gathering, which consumed him from sixth grade onward. The game appealed to his mathematical mind with its complex interactions and strategic depth. It was through Magic that Sam made his one meaningful childhood friend, Matt Nass. Unlike most social interactions, the game provided a structured environment with clear rules where Sam could excel. Math camp after his freshman year of high school provided another revelation. There, he encountered peers who thought like him and found himself "below average" among truly gifted mathematical minds. This humbling experience nonetheless confirmed that somewhere in the world, there were people who understood him. He began creating elaborate puzzle hunts for fellow enthusiasts, drawing hundreds of participants to solve his increasingly complex challenges. Despite his intellectual gifts, Sam remained socially isolated throughout adolescence. His classmates at Crystal Springs Uplands School viewed him as "smart and inoffensive and maybe not all that human." He never rebelled through typical teenage methods but rather maintained what he called a "romantically positive" view of his difference from others. Though he hadn't yet found his place in the world, his mathematical mind was uniquely suited for a future that would soon present itself.

Chapter 2: Jane Street Years: The Trader's Education

In the fall of 2012, during his junior year at MIT, Sam Bankman-Fried stumbled upon a career path he'd never considered. Like many physics majors who had lost interest in physics, he attended a job fair where several high-frequency trading firms were recruiting. Despite knowing nothing about finance, he dropped his resume with firms looking for traders rather than programmers, thinking little of it until he received interview invitations from three different companies. The interviews at Jane Street Capital were unlike anything he'd experienced. Rather than discussing his resume or academic achievements, they tested him with mental math, probability puzzles, and strategic games. During his in-person interview, Sam spent an entire day solving puzzles and playing specially designed games that tested his ability to make quick probability assessments with incomplete information. The firm handed him poker chips and warned that no one who lost all their chips had ever been hired. By day's end, Sam realized that these unusual challenges perfectly matched his natural thought patterns. "By the end of the day it was clear that it was by far the best I'd ever done at anything," he recalled. Jane Street hired Sam as a summer intern and later as a full-time trader on their international ETF desk. The trading floor was a cacophony of sounds – crash effects and video game noises signaling various market events. Sam thrived in this environment where his ability to calculate probabilities and make fast decisions under uncertainty was highly valued. He specialized in identifying market inefficiencies and exploiting them through automated trading systems. Rather than relying on gut feeling, traders created mathematical models to capture patterns and automate decisions. Sam excelled at finding situations where other traders or algorithms made predictable mistakes. While Sam found financial success at Jane Street, making $300,000 after his first year and reaching $1 million by his third year, he struggled emotionally. In private writings, he confessed, "I don't feel pleasure. I don't feel happiness. Somehow my reward system never clicked." His colleagues appreciated his trading abilities but couldn't penetrate his emotional distance. Sam learned to simulate normal social responses – forcing facial expressions and practicing small talk – but remained fundamentally disconnected. During this period, Sam also encountered effective altruism, a philosophy that approached charitable giving through mathematical analysis. Will MacAskill, an Oxford philosopher, posed a provocative question: should a person who wants to do good become a doctor in Africa, or a banker who donates enough to fund several doctors? The "earn to give" concept resonated deeply with Sam, offering a utilitarian framework for his growing wealth. He began donating substantial portions of his earnings to causes identified as most efficient at saving lives. By the summer of 2017, despite his rising status at Jane Street, Sam grew restless. He calculated that the odds of Jane Street being his highest-value career path were low. When he noticed the emerging cryptocurrency markets operating inefficiently, with billion-dollar trading volumes and primitive risk management, he saw an opportunity. Despite warnings from friends who scoffed at his prediction that he could make a billion dollars in crypto, Sam left his lucrative job to pursue what his mathematical mind recognized as an exceptional expected value opportunity.

Chapter 3: Alameda Research: Creating the Dragon's Hoard

In October 2017, armed with only his trading experience and the half-million dollars left from his Jane Street bonus, Sam Bankman-Fried launched Alameda Research. He assembled a small team of effective altruists, most of whom had no background in finance or cryptocurrency. Among his first recruits were Tara Mac Aulay, who had discovered cryptocurrency trading while working at the Centre for Effective Altruism; Gary Wang, a brilliantly quiet coder from MIT; and Caroline Ellison, another Jane Street trader who shared Sam's effective altruist worldview. Alameda's early days were chaotic but profitable. They discovered enormous inefficiencies in the crypto markets, particularly price differences between Asian and Western exchanges. In South Korea, for instance, bitcoin was trading at a 20% premium compared to U.S. exchanges. Anyone who could buy bitcoin outside Korea and sell it inside Korea would make enormous profits. The challenge wasn't identifying these opportunities but executing on them, as Korean regulations limited currency outflows. Sam considered extravagant solutions, including chartering jets filled with Koreans carrying suitcases of cash, before settling on trading strategies using the cryptocurrency Ripple to exploit these inefficiencies. Within months, their small operation was generating daily profits of half a million dollars. However, the rapid growth came with serious management issues. Sam proved to be a terrible leader, refusing to create systems, ignoring basic corporate controls, and making decisions unilaterally. He would play video games during meetings, fall asleep at his desk, and leave millions of dollars unaccounted for. In February 2018, approximately $4 million worth of cryptocurrency went missing. While Sam insisted it would turn up eventually, his management team was horrified by his cavalier attitude toward financial controls. The tension exploded in April 2018, when half the company, including most of the management team, resigned in what became known as "The Schism." They accused Sam of recklessness, dishonesty, and mismanagement. Remarkably, after their departure, Sam continued trading with the remaining staff and discovered that the missing funds had indeed been sitting in a South Korean exchange with a software compatibility issue. Alameda became consistently profitable, vindicating Sam's approach in the eyes of those who remained loyal to him. Caroline Ellison emerged from this turmoil as a key figure in Sam's world. Their relationship evolved from professional to romantic, though Sam maintained emotional distance. In private memos, Caroline expressed her growing romantic feelings while Sam replied with a cold cost-benefit analysis of their relationship. His list of "arguments against" dating her began with the devastating admission: "In a lot of ways I don't really have a soul... my empathy is fake, my feelings are fake, my facial reactions are fake." Despite this brutal assessment, they maintained an on-again, off-again relationship that would later play a significant role in Alameda's operations. By late 2018, Alameda Research had become one of the largest market makers in cryptocurrency, with billions of dollars in trading volume. Sam's trading strategies and risk appetite had created what insiders called "the dragon's hoard" – a massive collection of cryptocurrencies, investments, and cash that would form the foundation of his empire. Though ostensibly created to fund effective altruist causes, this growing treasure trove would later become both the source of Sam's power and the seed of his downfall.

Chapter 4: The FTX Empire: Crypto's Golden Child

In May 2019, Sam Bankman-Fried launched FTX, a cryptocurrency derivatives exchange that would rapidly transform him from an obscure trader into a financial titan. With Gary Wang coding the entire platform in just a month, FTX offered something the chaotic crypto world desperately needed: a professionally designed futures exchange with sophisticated risk management. Unlike competitors whose customers often suffered from "socialized losses" when trades went bad, FTX monitored positions in real-time and automatically liquidated losing trades before they could harm the exchange. Within its first year, FTX generated $10 million in revenue. By 2020, that figure jumped to $100 million, and in 2021, it skyrocketed to $1 billion. This explosive growth attracted the attention of major venture capital firms. Despite having no real need for outside capital, Sam allowed investors to buy small stakes in FTX at increasingly higher valuations. In a series of funding rounds, he sold approximately 6% of the company for $2.3 billion, with the final round valuing FTX at $32 billion. Remarkably, he maintained complete control, refusing to create a traditional board of directors or corporate governance structure. Sam's unconventional personal style became central to FTX's brand. With his cargo shorts, untamed hair, and Toyota Corolla, he cultivated an image as the antithesis of the typical finance bro. His apparent indifference to wealth – sleeping on a beanbag beside his desk and pledging to give away most of his fortune – resonated with those seeking a more ethical vision of finance. Major media outlets portrayed him as a different kind of billionaire, one motivated by effective altruism rather than greed. To expand FTX's reach, Sam embarked on an extraordinary marketing blitz. He paid $135 million for naming rights to the Miami Heat's arena, $210 million to sponsor an e-sports team, and secured endorsements from celebrities including Tom Brady, Gisele Bündchen, and Steph Curry. He even paid Kevin O'Leary $15.7 million for "twenty service hours, twenty social posts, one virtual lunch and fifty autographs." When questioned about these expenditures, Sam had a mathematical explanation: financial products were social networks, and capturing market share required visibility among social influencers. Behind this growth was an increasingly complex and opaque structure. FTX and Alameda Research remained legally separate entities, but both were controlled by Sam and operated from the same office. Alameda enjoyed special privileges on FTX, including an exemption from the automatic liquidation rules that applied to all other traders. The exchange's native token, FTT, functioned essentially as equity in FTX but existed in a regulatory gray area. Much of it was held by Alameda Research, creating circular dependency between the two entities. In late 2021, at the height of the crypto boom, Sam relocated his operation to the Bahamas, which had created a regulatory framework for cryptocurrency exchanges. He began to position FTX as the "good actor" in crypto, advocating for regulation and meeting with policymakers. His growing empire now included hundreds of investments in startups, substantial political donations, and a philanthropic arm committed to causes like pandemic prevention. From the outside, FTX appeared to be the mature, responsible face of an industry often associated with criminals and scammers.

Chapter 5: Living a Double Life: Effective Altruism and Artificial Love

At the heart of Sam Bankman-Fried's complex persona was his commitment to effective altruism (EA), a philosophy that applied mathematical reasoning to maximizing the good one could do in the world. Unlike traditional philanthropists who gave based on emotional connection to causes, effective altruists calculated which interventions saved the most lives per dollar. For Sam, this wasn't just a charitable framework – it was his entire moral compass and the justification for his pursuit of wealth. Sam's interest in effective altruism began during his MIT years when Oxford philosopher Will MacAskill introduced him to the concept of "earning to give." The idea that he could save more lives by making billions and donating strategically than by direct service provided Sam with a purpose his analytical mind could embrace. He committed to living frugally and giving away most of his wealth, a promise that resonated with other young effective altruists who soon formed his inner circle at both Alameda Research and FTX. As his wealth grew, Sam's philanthropic ambitions expanded beyond immediate causes like malaria prevention to what EA calls "longtermism" – addressing existential risks that threaten humanity's future. He funded research on artificial intelligence safety, pandemic prevention, and climate change. By 2022, his FTX Foundation was on track to donate $1 billion annually. To maximize impact, he pioneered an unusual approach: identifying subject matter experts and giving them million-dollar grants to redistribute as they saw fit, hoping to discover philanthropic talent. Alongside his public philanthropy, Sam engaged in enormous political giving, becoming one of the largest Democratic donors in the 2022 election cycle. He publicly discussed plans to spend up to $1 billion in the 2024 presidential race. While some of this political activity aligned with his business interests in cryptocurrency regulation, much was focused on pandemic preparedness and what he considered threats to democracy. He even explored the possibility of paying Donald Trump not to run for president, though this never materialized. In his personal life, Sam maintained relationships that, like everything else, operated according to expected value calculations rather than emotion. His on-and-off relationship with Caroline Ellison exemplified this approach. In memos they exchanged, Caroline expressed genuine romantic feelings while Sam responded with cost-benefit analyses of their relationship. He acknowledged his inability to feel conventional emotions, writing, "I don't feel happiness. What's the point in dating someone who you physically can't make happy?" The effective altruists in Sam's inner circle embraced unconventional relationship structures, with many practicing polyamory. They viewed monogamy as an irrational limitation, much like they viewed other social conventions. Living together in a luxury penthouse in the Bahamas, they spent their limited non-working hours playing board games and discussing philosophical thought experiments rather than engaging in typical leisure activities. This coldly rational approach to human relationships extended to Sam's management style. He refused to create organizational charts or job descriptions, believing they made people "substantially worse." He expected employees to work 18-hour days and showed little interest in their personal lives or struggles. When his psychiatrist created the only known organizational chart of FTX, he discovered that 24 different people believed they reported directly to Sam – though Sam himself rarely provided guidance to any of them.

Chapter 6: The Collapse: An $8 Billion Customer Betrayal

The unraveling of Sam Bankman-Fried's empire began with what seemed like a minor crypto news story. On November 2, 2022, CoinDesk published an article revealing that a significant portion of Alameda Research's assets consisted of FTT, the token created by FTX. While insiders didn't find this particularly alarming, it caught the attention of Changpeng Zhao (CZ), the founder of Binance and Sam's former investor turned rival. Four days later, CZ announced on Twitter that Binance would liquidate its FTT holdings, triggering panic across the crypto markets. What followed was a classic bank run. Customers rushed to withdraw their funds from FTX, pulling out $5 billion in just three days. By November 8, it became clear that FTX could not meet customer withdrawal demands. Behind the scenes, Sam and his inner circle made frantic attempts to raise emergency funding, calling every potential investor who might be able to deliver billions quickly. The devastating truth emerged: approximately $8 billion in customer deposits that should have been safely stored on FTX had somehow ended up inside Alameda Research. In a desperate move, Sam reached out to CZ, who briefly agreed to acquire FTX before withdrawing after examining its books. On November 11, FTX filed for bankruptcy, and Sam resigned as CEO. Within hours, mysterious transactions drained hundreds of millions of dollars from FTX wallets in what appeared to be a hack. The collapse triggered a broader crypto market meltdown and left millions of customers unable to access their funds. The public narrative quickly shifted from viewing Sam as crypto's responsible face to seeing him as perpetrator of one of the largest financial frauds in history. His net worth plummeted from an estimated $26 billion to effectively zero. His carefully cultivated image as the ethical billionaire crumbled as investigations revealed the absence of basic financial controls, nonexistent record-keeping, and commingling of customer funds with trading accounts. Sam's explanation for the missing customer deposits evolved over time. Initially, he claimed ignorance, suggesting on Twitter that he "wasn't running Alameda" and "didn't realize the full extent of the margin position." Later, he offered a more detailed account: when FTX was first created in 2019, it lacked banking relationships, so customer deposits were received through Alameda's bank accounts in what was labeled the "fiat@" account. According to Sam, these funds were never properly segregated, and over time, Alameda began using them for trading. The fallout was swift and devastating. Caroline Ellison, Gary Wang, and other key executives quickly cooperated with federal investigators. On December 12, 2022, Sam was arrested in the Bahamas. After being extradited to the United States, he was charged with multiple counts of fraud, conspiracy, and money laundering. His former colleagues pleaded guilty and agreed to testify against him, while John Ray III, the new CEO appointed to oversee FTX's bankruptcy, described the situation as "a complete failure of corporate controls" unlike anything he had seen in his career managing corporate collapses. Throughout this period, Sam maintained that he had not intentionally committed fraud. He insisted that the commingling of funds resulted from poor risk management and accounting errors rather than deliberate theft. However, prosecutors alleged that he had knowingly diverted customer funds to cover Alameda's losses, fund political donations, and purchase luxury real estate in the Bahamas.

Chapter 7: Aftermath: Truth, Consequences and Questions

In the wake of FTX's collapse, the cryptocurrency industry faced its most severe crisis of confidence since its inception. The contagion spread rapidly, toppling other crypto lenders and exchanges that had exposure to FTX or Alameda. Cryptocurrency prices plummeted, with Bitcoin losing over 60% of its value in 2022. Regulators worldwide, who had been slow to create frameworks for digital assets, accelerated their efforts to bring the industry under supervision. The era of crypto's Wild West appeared to be ending. For the thousands of FTX customers whose funds remained frozen in bankruptcy proceedings, the aftermath brought little immediate relief. Many had trusted FTX precisely because of Sam's reputation as the ethical face of crypto. The bankruptcy process revealed that FTX had over one million creditors, ranging from retail investors who had deposited their life savings to major investment firms. John Ray III and his team embarked on a global treasure hunt to recover assets, combing through FTX's complex web of entities and investments to reclaim whatever value remained. The personal consequences for Sam Bankman-Fried were equally severe. Released on a $250 million bond while awaiting trial, he was confined to his parents' home in California. His former colleagues, including Caroline Ellison and Gary Wang, pleaded guilty to multiple charges and agreed to cooperate with prosecutors. Sam maintained his innocence, offering complex explanations that emphasized mistakes rather than intentional fraud. His public defense focused on poor risk management and accounting errors, arguing that he had not knowingly misappropriated customer funds. Perhaps most striking was the collapse of Sam's effective altruist dream. The billions he had promised to donate to prevent pandemics, mitigate climate change, and reduce existential risks disappeared overnight. The FTX Foundation ceased operations, leaving numerous promising projects without funding. The effective altruism movement itself faced a crisis, as its critics pointed to Sam as evidence of the dangers in applying cold calculation to ethical questions. Some questioned whether Sam had ever truly believed in the movement's principles or had simply used them as moral cover for accumulating wealth and power. Sam's case raised profound questions about the intersection of technology, finance, and ethics in the digital age. How had someone so apparently committed to doing good caused so much harm? Was his downfall the result of criminal intent, technical incompetence, or the inevitable consequence of building financial structures without proper oversight? The answers remain contested, with different observers drawing different lessons from the saga depending on their perspectives on cryptocurrency, effective altruism, and modern finance. What remains undisputed is that Sam Bankman-Fried's rise and fall represents one of the most dramatic financial collapses in modern history. In just three years, he built a global empire valued at $32 billion, only to see it evaporate in a matter of days. His story serves as a cautionary tale about the dangers of unregulated finance, the limits of mathematical thinking when applied to human systems, and the complex relationship between stated intentions and actual outcomes. As one former employee observed, "He made me believe there was a Sam" – suggesting that perhaps the most successful illusion Sam created was not just FTX, but the public persona of Sam Bankman-Fried himself.

Summary

Sam Bankman-Fried's trajectory from mathematical prodigy to crypto billionaire to disgraced executive embodies a profound paradox: a man who claimed to pursue wealth solely to benefit humanity ended up causing immense harm to the very people who trusted him. His story reveals how even the most rational-seeming approaches to ethics can go catastrophically wrong when divorced from traditional accountability systems and basic human empathy. The collapse of FTX demonstrated that financial innovation without appropriate governance creates not just economic risk but moral hazard. The enduring lesson from Sam's rise and fall may be that mathematical brilliance and good intentions are insufficient safeguards against human fallibility. For those working in emerging technologies or innovative financial systems, his cautionary tale highlights the critical importance of transparency, proper controls, and the willingness to subject one's decisions to external scrutiny. Perhaps most importantly, it suggests that truly ethical leadership requires not just calculating the greatest good but also respecting fundamental principles of honesty and trust that no utilitarian equation can override.

About Author

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Michael Lewis

Michael Monroe Lewis is an American author and financial journalist. He has also been a contributing editor to Vanity Fair since 2009, writing mostly on business, finance, and economics. He is known for his nonfiction work, particularly his coverage of financial crises and behavioral finance.Lewis was born in New Orleans and attended Princeton University, from which he graduated with a degree in art history. After attending the London School of Economics, he began a career on Wall Street during the 1980s as a bond salesman at Salomon Brothers. The experience prompted him to write his first book, Liar's Poker (1989). Fourteen years later, Lewis wrote Moneyball: The Art of Winning an Unfair Game (2003), in which he investigated the success of Billy Beane and the Oakland Athletics. His 2006 book The Blind Side: Evolution of a Game was his first to be adapted into a film, The Blind Side (2009). In 2010, he released The Big Short: Inside the Doomsday Machine. The film adaptation of Moneyball was released in 2011, followed by The Big Short in 2015.Lewis's books have won two Los Angeles Times Book Prizes and several have reached number one on the New York Times Bestsellers Lists, including his most recent book, Going Infinite (2023).

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