BANKMAN-FRAUD’S FTX BACKDOOR

For some years, ever since the phenomenon of the emergence of so-called "crypto-'currencies'" or "digital 'currencies'", I have been trying to warn about the dangers of the phenomenon.  Others have raised their voices as well. Catherine Austin Fitts has been almost tireless in her efforts to awaken peoples to the real nature of these so-called "currencies", calling them "corporate coupons" (which means they're not currencies in any classical sense), and more generally trying to warn people about the dangers of cyber systems in general with her warning "no cyber system is secure."

My personal warnings have tended to be more obscure, but basically have been variations on her theme of the basic insecurity of cyber-systems. One of my pet peeves has been the argument that the blockchain technology - or more accurately, the blockchain technique - shares the same flaws of all such human claims: the impenetrable armor eventually meets a more potent projectile; the unhackable firewall or program eventually meets a program projectile that hacks it.

Recently, however, as if to underscore all these warnings, the FTX fraud scheme broke into the news, as the crypto-currency scheme of Sam Bankman-Fried, whom we refer to at this site by the apt nickname of Bankman-Fraud, was revealed to be nothing but a money laundering operation and form of electronic theft.

Gee, what a surprise...

...NOT.

But now there's yet another twist to the plot according to this article from the U.K.'s Daily Mail:

The article begins with a series of questions:

Where did this guy come from?
How did he become a multi-millionaire?
Was he a government asset?
Was he used by the elites to funnel money to fellow elites?
Was he used by the deep state to sabotage crypto currencies?
How much money did he ultimately funnel to Democrats and their causes?

The tentative answers thus far can be summarized as follows:

We don't really know.

It looks like graft, money laundering, and fraud were the principal methods.

Maybe...

It sure looks like he did.

Maybe so, to make room for the central bank version of the same thing.

A lot, but there were also Republican recipients of his fraudulent largesse, including Senator Mitch McConnell.

Now we're being told that a secret back door was also part of the operation:

A bombshell testimony has revealed that the co-founder of cryptocurrency exchange FTX was ordered by Sam Bankman-Fried to create a ‘secret’ backdoor to funnel money to Alameda Research.

Attorney for FTX Andrew Dietderich told the Delaware bankruptcy court on Wednesday that Gary Wang was told to create the secret line of credit of customer funds from FTX to the hedge fund.

Dietderich told the court that Wang ‘created this backdoor by inserting a single number into millions of lines of code for the exchange’ creating the line of credit, which ‘customers did not consent’ to.

The FTX attorney testified that the backdoor was a ‘secret way for Alameda to borrow from customers on the exchange without permission,’ Business Insider reported.

These revelations raise all sorts of questions, and sound the alarm, once again, about the dangers of any crypto- or digital-"currency", including a central bank digital currency: back doors can be placed into any computer program with administrative access, and I would aver that those willing to trust a central bank not to do so in an era when financial fraud has been at a premium are playing with fire. More to the point, how do we know that such back doors have not been placed into other crypto-"currencies" already?  (PROMIS, anyone?) Answer: we really don't; what trust there is in cryptos has been built up largely and almost exclusively due to the claim that its blockchain technique is supposedly almost invulnerable to hacking. This in spite of stories of hacking to the contrary. See for example, the following:

Hackers return nearly half of the $600 million they stole in one of the biggest crypto heists

Second Biggest Crypto Hack Ever: $600 Million In Ether Stolen From NFT Gaming Blockchain

Can Crypto Be Hacked?

And so on. With this sort of record, what is more amazing is how long it took for a Bankman-Fraud to come along and realize that the crypto-"currency" phenomenon was a perfect way to launder money.

Other questions swirl around the FTX scandal. Is there a connection to Communist China? Were any Chinese funds - Party or private - laundered through the FTX network to Democratic and Republican political candidates? What about the Delaware connection? Does that go any deeper?

While these questions continue to hover over the whole story, the backdoor is now a matter of record. I suspect, eventually, that the whole crypto-"currency" phenomenon will be revealed to have backdoors all over the place, that they are the rule, not the exception. Bankman-Fraud was merely the first one to reveal the inherent problem.

See you on the flip side...

Joseph P. Farrell

Joseph P. Farrell has a doctorate in patristics from the University of Oxford, and pursues research in physics, alternative history and science, and "strange stuff". His book The Giza DeathStar, for which the Giza Community is named, was published in the spring of 2002, and was his first venture into "alternative history and science".

No Comments

  1. Robert Barricklow on January 19, 2023 at 8:45 pm

    Controlling people is the biggest industry on Planet Earth.
    The controllers current objective?
    Kill currencies & make humans collateral[slaves]

  2. marcos toledo on January 18, 2023 at 6:54 pm

    Another question about Bankman Fraud is who were his paymasters and as he and his fellows in crime were just the convenient useful idiots, scapegoats, and sacrificial monkeys?

    • Richard on January 19, 2023 at 9:07 pm

      They’re [paymasters] and string pullers are likely the one’s with the supercomputers and the bankroll to foot the building, maintenance of, and administrative smarts to plan well ahead of any law & lawyer pursuits. Tracking them down, in the name of the law, PROMIS’ to be quite a keystone chase along the wired and wireless.

  3. Richard on January 18, 2023 at 2:38 pm

    Whether in finance, intelligence gathering, or going boldly where AI has not been before (or directed by an upright-simian type sometimes called humankind and its modern pronoun variants), the clepto-beast does not seem done with the primate type mentality.

    It gobbles data, energy, and power even from the greedy. It’s likely a bottomless pit or, possibly, the heavens, depending on how it is dramatized. An algorithmic gizmo-gadget under development until it is not.

    Careful where you plug that device in or where you turn it on. The wired and wireless are both conduits toward nefarious adventure. To the new light finger adventurer, it’s like the fictional and fabled Mirror of Erised that suggests a pathway to Epicurean delights that satiate hidden desires. The clepto-beast seems to take down all who seek it. It seems the epitome of greed incarnate.

  4. ragiza on January 18, 2023 at 12:54 pm

    Bitcoin and other crypto currencies are not opaque to organizations like NSA, FBI and CIA , and haven’t been for years.

    Does that mean we’re going to learn what FTX was doing with its money transfers? Nope- if my guess is right, it was an incompetent attempt by US political clowns on the left to set in place a money cow / transfer system to facilitate corruption and illicit campaign financing. Maybe-Probably a Hillary op.

    Anything that’s released by the authorities on FTX is likely to 180 degrees from true bearing.

    https://theintercept.com/2018/03/20/the-nsa-worked-to-track-down-bitcoin-users-snowden-documents-reveal/

    “”The documents indicate that “tracking down” bitcoin users went well beyond closely examining bitcoin’s public transaction ledger, known as the Blockchain, where users are typically referred to through anonymous identifiers; the tracking may also have involved gathering intimate details of these users’ computers. The NSA collected some bitcoin users’ password information, internet activity, and a type of unique device identification number known as a MAC address, a March 29, 2013 NSA memo suggested. In the same document, analysts also discussed tracking internet users’ internet addresses, network ports, and timestamps to identify “BITCOIN Targets.”

    The agency appears to have wanted even more data: The March 29 memo raised the question of whether the data source validated its users, and suggested that the agency retained bitcoin information in a file named “Provider user full.csv.” It also suggested powerful search capabilities against bitcoin targets, hinting that the NSA may have been using its XKeyScore searching system, where the bitcoin information and wide range of other NSA data was cataloged, to enhance its information on bitcoin users. An NSA reference document indicated that the data source provided “user data such as billing information and Internet Protocol addresses.” With this sort of information in hand, putting a name to a given bitcoin user would be easy.””

    And BTW, it’s not all that bizarre to wonder if NSA or some other big capability national intelligence organization didn’t create crypto, for intel purposes.

    • FiatLux on January 19, 2023 at 12:08 am

      >it’s not all that bizarre to wonder if NSA or some other big capability national intelligence organization didn’t create crypto, for intel purposes.

      My thoughts exactly.

  5. Michael UK on January 18, 2023 at 8:40 am

    I think it will be very difficult, near impossbile to ever get to the truth as crypto currencies by their nature are stealth currencies.

    https://www.newsweek.com/what-behind-claim-joe-biden-laundered-billions-ukraine-aid-via-ftx-1759774

    https://www.ibtimes.com/did-ukrainian-president-zelensky-invest-billions-ftx-3638781

    I expect a lot more regulation, checks and balances from Central Banks will follow in its wake.

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