SBF fumbled, Zuckerberg grumbled, and Larry Fink forecasted a tumble.
The New York Times DealBook Summit hosted a who’s-who of Big Tech newsmakers Wednesday, headlined by the world’s most despised crypto entrepreneur.
While former FTX CEO Sam Bankman-Fried stole the show with his fidgety ruminations on the cryptocurrency exchange’s multibillion-dollar collapse, plenty of news emerged from Andrew Ross Sorkin’s grilling of tech business chiefs. A few spare thoughts below on three of the marquee CEOs who went under the microscope.
Bankman-Fried, trying to stay out of stripes
The one-time crypto wunderkind told Sorkin his lawyers are “very much” opposed to him speaking about FTX’s ignominious demise. Yet Bankman-Fried sounded very much like a man with white shoe firms on retainer.
While explaining his role in FTX’s downfall, Bankman-Fried repeatedly used phrases laced with legalese. Asked about his role in the scandal, Bankman-Fried said he “did not ever try to commit fraud on anyone” and didn’t “know of times when I lied.” Asked about one of the core issues leading to FTX’s bankruptcy—the transfer of customer assets to an affiliated crypto hedge fund, Alameda Research, that made risky, illiquid investments—Bankman-Fried claimed he “didn’t knowingly commingle funds” and was “surprised” by Alameda’s disastrous balance sheet.
It strains credulity to think ignorance and ineptitude were the sole causes of FTX and Alameda Research falling apart—especially considering Bankman-Fried owned a whopping 90% of the latter entity, according to FTX bankruptcy filings.
Ultimately, though, criminal and civil investigators will suss out whether Bankman-Fried’s actions amounted to fraud or other criminal activity. They should have access to a decent paper trail and potential co-conspirators looking to save their own bacon.
If Wednesday is any indication, Bankman-Fried won’t give himself up easily.
Mark Zuckerberg, setting himself up for hypocrisy
The Meta CEO joined a growing chorus of complainers grousing about Apple’s App Store rules, which give the iPhone maker the ability to shut out developers failing to meet company-set terms of service.
“Of the major computing platforms, Apple stands out,” Zuckerberg told Sorkin. “It is the only one where one company can control what apps get on the device. I don’t think it’s sustainable or good.”
Zuckerberg isn’t wrong. Unlike Google, which allows Android users to download apps from third-party stores, Apple forces all developers to route their products through the company’s App Store review process. Apple also takes a 15% to 30% cut of their app revenues once developers receive approval.
But stock away this quote. Zuckerberg is investing $10 billion-plus annually in building out the metaverse, which he hopes will become the next major computing platform. Meta eventually will need to show a return on this massive investment—and as Apple has shown, the best way to squeeze billions out of a platform is to tightly control the ecosystem.
While Meta hasn’t fought the emergence of a third-party app store on its Quest virtual reality platform, it’s already taking a cut of up to 47.5% on digital assets sold in its Horizon Worlds metaverse.
Larry Fink, prognosticating a sea change
The CEO of investment management titan BlackRock lent his voice Wednesday to the burbling sentiment that there’s a new day dawning in tech.
Fink said he believes the app market has matured and most crypto enterprises will go bust. He predicted that venture capitalists will shift their money to more tangible, climate-focused technologies.
“It’s not going to go to all this stuff that provided us good utility to get food quicker, or find a taxi sooner,” Fink said. “I think it will be much more hard science, and require a lot more technical understanding.”
Fink, the chief cheerleader of stakeholder capitalism, has been banging the climate drum for a while—and incurred the wrath of anti-woke conservatives in the process. But the inflation-driven downturn in tech stocks and contagion effects of FTX’s bankruptcy give his claims a little extra credence.
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Jacob Carpenter
