Back in April I paid $12 to “attend” a virtual event with 30-year-old crypto billionaire Sam Bankman-Fried. Around 45 other people registered for the Zoom, which was hosted by Manny Yekutiel, a San Francisco-based Democratic organizer and owner of the eponymous civic venue Manny’s.
Yekutiel is an affable but astute questioner, who sat against a hot-pink sequin backdrop and pressed SBF (as he’s known) on crypto applications and regulation, concepts of liberty and freedom, and the potentially destructive means that might serve the endgame of effective altruism. SBF, who dialed in from a darkened Washington, DC, hotel room, seemed pleased with his own answers. He also appeared distracted throughout the 50-minute Zoom, his gaze wandering and his face intermittently illuminated, the telltale sign of another application being opened. League of Legends? Maybe. Either way, I didn’t walk away—or close my laptop—with any greater understanding of the hype.
It was a different SBF who sat for a livestreamed interview with the razor-sharp financial journalist Andrew Ross Sorkin this week. The crypto entrepreneur’s right arm kept shaking, and he looked chagrined. “Look, I’ve had a bad month,” SBF said at one point, in what might be the understatement of 2022.
In recent weeks SBF’s $32 billion crypto exchange, FTX, has completely unraveled. Investors have lost millions. SBF’s own largely theoretical wealth has dwindled. Prominent investors have tried to scrub their connections with him. And the onetime wunderkind seems unable to directly answer questions about his own culpability in what is increasingly being perceived as a fraudulent crypto scheme. “I was as truthful as I’m knowledgeable to be,” he said to Sorkin. “I don’t know of times when I lied.” (It depends on what the meaning of the word is, is.)
Were there signs that FTX was a house of cards and that maybe its whiz-kid founder didn’t know which way is up? The answer is partly contingent on one’s inherent skepticism and understanding of the machinations of the crypto market. Short answer: Yes. Federal prosecutors were reportedly looking into FTX months before it crashed. But there were other reasons to be skeptical of an unproven entrepreneur who seemed overly willing to embody the Silicon Valley, mad genius archetype. So why did we—investors, crypto fiends, the media—go along with it again? Or, as writer and known billionaire-skeptic Anand Giridharadas put it, “My only take on the SBF interview is that I don’t know why we keep trusting highly limited, demi-adult men with the keys to our prosperity and society … He has very little to teach. A lot to learn. Somehow, so many got it backwards.”
I posed this question to Margaret O’Mara, a professor of history at the University of Washington and author of The Code: Silicon Valley and the Remaking of America. Everyone loves the hero’s journey, O’Mara said immediately. We’re still fixated on the idea of the eccentric genius accomplishing extraordinary things.
People still cite Bill Gates, the ultimate nerd who went on to helm an extremely transformative company, as a prime example, O’Mara points out. A generation later it was two computer scientists named Larry and Sergey, who presented not only a clean, uncluttered search portal to the world—an antidote to the pop-up mayhem of the late dotcom era—and bean-bagged offices to their employees, but who also retained control of a special class of voting shares of their company. Their greatest innovation might not have been search, but “founder control.”
In the case of Sam Bankman-Fried or the recently sentenced fraudster Elizabeth Holmes, the collective and generally positive fascination with them may have stemmed from old-fashioned solutionism. “They were both fixing a failure, right?” O’Mara says. “Holmes enters the scene at a time when people are asking, ‘Where are the women in tech? Also, all you guys are doing in the Valley is making apps. She’s making medical devices that are going to change health care.’”
More recently, the world of crypto has also been seen as imperfect and even downright sketchy. Then along came SBF, and the familiar cycle began again. “He’s the stereotype, the nerdy guy in the cargo shorts with a pedigreed background,” O’Mara says. “He’s a quant. And then he’s talking about politics and altruism. He’s not just talking about the tech he’s heads-down in, he’s talking about the world and how he can deploy what he’s doing more broadly.”
Basically, O’Mara’s diagnosis of the underlying problem is a persistent case of techno-optimism. Despite the fact that technology hasn’t lived up to all its promises to turn us into a smarter, more efficient, more productive society over the past 20 years—a point that was made in another lengthy conversation I had this week—we still wonder if tech itself can solve the complexities tech hath wrought. “There’s this hopefulness that technology will save us, even though we have abundant evidence that it can be problematic,” O’Mara says.
It’s an arguably simplistic explanation for why so many people hastily put SBF on a pedestal, but that doesn’t mean it’s wrong. We’re human, after all. (I am reminded of another Giridharadas gem on tech founder hero worship: “They are as limited at humanity as I am at coding. But therefore I stay away from coding, and they refuse to stay away from lording over humanity.”)
Maybe that’s what I was looking for when I tuned into that Zoom event with SBF back in April: some evidence of humanity, in addition to a better understanding of exactly how an unregulated exchange for digital coins could be worth the equivalent of billions of US dollars. Now, after a spectacular downfall, at least one of those is crystal clear.
This is my favorite part of writing Steven’s newsletter, because I get to browse the library here in our San Francisco office and swipe at the decades old, dead-tree versions of WIRED. (Magazines were … thicker then.)
Ten years ago this month, WIRED published a cover story by the writer Mat Honan, who now happens to be editor-in-chief of MIT Technology Review, about the end of the password. The story was quintessential 2010 WIRED: It was smart and deeply nerdy, prescient, rooted in personal technology, it highlighted a 14-year-old hacker named Dictate, and it was penned by a white guy.
“The age of the password has come to an end; we just haven’t realized it yet. And no one has figured out what will take its place. What we can say for sure is this: Access to our data can no longer hinge on secrets—a string of characters, 10 strings of characters, the answers to 50 questions—that only we’re supposed to know. The Internet doesn’t do secrets. Everyone is a few clicks away from knowing everything.”
Honan goes on to write that the future of passwords will be multifaceted systems that cross-reference personal identity information with geolocation and biometric data. More secure passwords will require a trade-off—convenience for privacy—and the whole endeavor might feel a little bit creepy, all for the sake of thwarting creepy scammers. So far, much of that has proven true. Many of us rely on 2FA, unlock our phones with our faces and fingerprints, and get a fast call from our bank if a charge is made halfway across the world.
We still use passwords, though, those nonsensical multi-character strings that we now store in another app with a password of its own. As WIRED’s Lily Hay Newman pointed out last year, passwords are still “deeply familiar and absurdly ubiquitous.” And truly password-less schemes often require people to buy new devices, or at least own a smartphone, along with at least one other device. Kudos to Honan for mostly accurate soothsaying. But hopefully our next vision for the future includes fewer devices, not more.
I don’t have a reader question this week, because I haven’t yet found a way to hack into Steven’s inbox. But last week I was asked a question that comes up, consistently, around this time of year. My good friend Liz said she’s ready for a smartwatch and asked which one she should get. You have to understand, Liz is one of those high-energy people who bikes a hundred miles for fun. And she already has a Garmin for her bike. So my first thought was to recommend the Garmin Fenix watch that I’ve worn for years. But then she said she’s looking for a watch that will make her use her phone less.
Since she’s an iPhone user, the answer is pretty obvious: an Apple Watch. Is it also a decent sports watch? Sure, especially if someone is willing to shell out for the bulky Apple Watch Ultra. But it’s interesting to consider the evolution of the Apple Watch over its seven-year lifespan thus far—from iPhone-on-your-wrist, to pretty darn good health tracker, to, OK, it’s not a phone replacement but it might just let you look at your phone screen a little less. Tech as a solution to a tech problem. And of course, it will still keep you tied, wirelessly and metaphorically, to your iPhone.
You can submit questions to mail@wired.com. Write ASK LEVY in the subject line.
I mean, come on.
I recently sat down with Max Levchin, the man behind the buy now, pay later (BNPL) craze and a PayPal cofounder, who is now waging war on the credit card industry. We talked about his company Affirm, broader economic concerns, the techlash, and, yes, Elon Musk.
WIRED’s Michael Calore and I also talked about BNPL on this week’s Gadget Lab podcast, where Mike asked two important questions (among others): How is BNPL really different from credit cards, and what’s the catch?
Amazon Airports? Yes, they’re a thing. WIRED’s Caitlin Harrington dives deep into the lengths Amazon will go to maintain its retail dominance. She also found time recently to dig into Apple, where employees are learning that anyone based out of the company’s Texas offices will now have to choose between their reproductive rights and their job.
Twitter has made it possible for the world to see the attacks on protesters and the horror of those killed in Iran. What happens if Twitter-as-a-lifeline becomes irrevocably damaged in the Musk era?
As soon as you’re done reading this newsletter, update iOS, Android, and Windows.
That’s a wrap for now. Until next week, when Steven returns from the Bahamas and I go back to trying to launch (another) podcast.
Updated 11.45 am EST 12/2/2022: This article has been updated to correct Anand Giridharadas' name.
