site banner

Scott Alexander on Sam Bankman-Fried, FTX and Effective Altruism

astralcodexten.substack.com

I made this a top level post because I think people here might want to discuss it but you can remove it if it doesn't meet your standards.

Edit: removed my opinion of Scott from the body

15
Jump in the discussion.

No email address required.

Many rationalists support crypto because they consider that it will help to avoid government control to buy nootropics, participate in prediction markets etc. My advice is that instead of supporting crypto it is better to lobby politicians to allow to do these things legally and openly. That may take longer time and be harder to achieve but it will be much better because negative externalities from crypto are too severe and damaging that they cancel all the benefits that crypto could give us.

Many of these things are legal in other countries and they are not as great as many rationalists think. I am in Latvia now; piracetam and phenibut are manufactured by a local pharmaceutical company here, they are not only legal but doctors routinely prescribe them. What I think about them is that their effectiveness is very low. Healthcare professionals consider them as low class antidepresants/anxiolytics. They have very few adverse effects but basically they do very little.

If 50% of antidepressant effect is due to placebo effect, then prescribing something to people with moderate depression/anxiety will have 50% improvement rate. Doctors initially select medicines with less side-effects and switch to more serious antidepresants when they are not effective. It would be good if other countries used them as well but in the big scheme, they matter very little that it is not worth to use crypto to illegally buy them.

piracetam and phenibut

prediction markets

Are you for real?

No, I need crypto to move assets out of an authoritarian country, to buy actual illegal drugs and VPN and bulletproof servers, to fund people doing unapproved research and in the extreme case, assassinations. I cannot rely on «lobbying politicians» who can easily score political points with the 95 IQ hoi polloi by throwing them some witches or saying they're «thinking of the children» or some such. No polity is deserving of my trust and vulnerability.

Societies with very well tracked money tend toward tyranny since Spartan times, and tyranny tends toward tracking of money streams; your approach is entirely dependent on trusting democratic procedures, but that is obviously impotent past some points of no return which are easily reached. This clown world logic of «let's force people to do everything in the public sphere instead of running underground, then they will negotiate a better equilibrium» is either naive or just a cynical cover for totalitarianism with extra steps. Likewise for its variations – let's disarm people so they become more active in civil politics and such. Let's prohibit medicine to promote healthy lifestyles while we're at it.

In reality, the absence of privacy, freedom to change one's state, and tools of personal agency such as weapons and means of exchange, reinforces the dominance of incumbent players, by shortening the feedback loop. It takes away the chances of small players to prepare something and come to the table with solid counteroffers, and rewards them for just shutting up and accepting the mainstream position, wherever it originates.

negative externalities from crypto are too severe and damaging

I believe that the emergence of domesticated peoples who can trust the polity is already a massive negative externality of economies of scale and organized state violence, and a dangerous step towards the eusocial attractor. It's incomparably worse than a little crime and some modest waste of electricity.

No, I need crypto to move assets out of an authoritarian country, to buy actual illegal drugs and VPN and bulletproof servers, to fund people doing unapproved research and in the extreme case, assassinations.

Talk about ambitions ;-)

Cyber crypto assassinations are something that happens in cyberpunk fiction and anarcho capitalist theory, there is no one documented case IRL of succesful online murder for hire.

To order assassinations, you need close and deep personal connections of the right kind, the opposite of crypto.

"Why are you so sad? Seeing my friend sad breaks my heart so much."

"Billy Bob is messing with your business and causes you so much trouble? Fortunately, I know some guys who know how to deal with such problems. No, I do not need anything, I will do everything for my friend."

...

Few days later, Billy Bob is found swimming in the nearby lake wearing concrete shoes. Everyone lives happily ever after.

Sounds like a market opportunity to me. Why aren’t there Bond-villain type organizations that kill for profit alone? Was RICO that effective?

Any hired killer who actually put themselves up online openly would get immediately arrested, and anybody who googles "hire killer online" will be led to a police honeypot and promptly arrested. Because duhhhh.

Maybe there are no Bond-villain type organizations? I mean, there are crime syndicates, but they do not need to retail their enforcement capabilities to any random Joe with a bitcoin. They want them for themselves, tightly controlled by their leadership. And those who would retail probably would end up taking an order from LEO and going to jail very soon. It's an inherent contradiction between having wide retail appeal and tight opsec.