The Reputation of Michael Lewis in the Crypto Community: A Fall from Grace
Michael Lewis, the renowned finance writer, has long been admired by many in the crypto industry. Known for his exposés on the flaws and corruption in the world of finance, Lewis has been seen as a voice of truth and reason in an industry often defined by complexity and opacity. However, Lewis’s recent “60 Minutes” interview and the subsequent release of his latest book, “Going Infinite,” have caused many in the crypto community to view him in a different light.
In the interview, Lewis discussed his role as an advisor to Sam Bankman-Fried, the disgraced founder of the now bankrupt crypto exchange FTX. Bankman-Fried is currently facing multiple counts of fraud and is set to go on trial. Lewis’s apparent support of Bankman-Fried and his willingness to defend him in the media have raised eyebrows and led to questioning of Lewis’s impartiality and integrity.
One of the most concerning aspects of Lewis’s interview was his statement that if there hadn’t been a run on customer deposits at FTX, the exchange would still be making tons of money. This statement reflects a fundamental misunderstanding of how crypto exchanges operate and the responsibility they have to their customers. Unlike traditional banks, crypto exchanges are not supposed to lend or use customer deposits, and they are not fractional reserve institutions. Lewis’s failure to grasp this concept, despite his extensive knowledge of financial fraud, is puzzling at best.
Furthermore, there have been accusations that Lewis may have financial ties to FTX, which would call into question his objectivity as a writer and journalist. Venture capitalist Nic Carter flagged the partnership between Bankman-Fried’s hedge fund Alameda Research and IEX, an alternative stock exchange that Lewis wrote about in his book “Flash Boys.” There have been suggestions that Lewis may have been financially ensnared in the web of FTX corporate, which consists of over 100 shell companies and subsidiaries.
It is also worth noting that Lewis has been criticized for presenting opinion as fact in his defense of Bankman-Fried. He has made statements suggesting that FTX would still be a going concern if not for external factors, such as panic runs triggered by other crypto CEOs. These claims ignore the reality of the massive fraud that took place at FTX and the significant financial mismanagement that occurred.
Overall, Lewis’s recent actions and statements have tarnished his reputation in the crypto community. Many now view him as an advocate for someone who is currently facing serious allegations of fraud and mismanagement. Lewis’s apparent lack of understanding of basic principles of crypto exchanges and his potential financial ties to FTX have raised concerns about his ability to provide unbiased and accurate reporting.
As Lewis’s latest book, “Going Infinite,” is released, it remains to be seen how the crypto community will respond. Will readers view it as a balanced and objective account, or will they see it as a misguided defense of someone who may have committed widespread fraud? Only time will tell, but for now, Lewis’s reputation in the crypto world has undoubtedly taken a hit.
Disclaimer: The above article is an opinion piece and does not necessarily reflect the views and opinions of CoinDesk.