Faking It, Making It, Losing It
The spectacular rise and fall of FTX and its founder Sam Bankman-Fried were driven by effective marketing, trickery, and financial speculation. In that, they bear a striking resemblance to the disastrous eighteenth-century experiment that fueled the Mississippi Company bubble and created the template for all future Ponzi schemes.
PRINCETON – The collapse of cryptocurrency exchange FTX and the mesmerizing rise and fall of its founder, Sam Bankman-Fried, is only the most recent episode encapsulating the perils of financial innovation. At this point, it should be easy for regulators, financial institutions, and investors to spot an obvious Ponzi scheme. Why, then, must we relearn a difficult lesson over and over?