My wife texted me a link to a New York Times article this weekend with the short comment, “These guys are super douches.” I was pretty sure what the article would be. My wife is blessedly indifferent to the crypto world, but she’s not above a good hate read on the subject—and, as I correctly guessed, she wanted to share the Times’s account of the latest antics of the loathsome duo behind the failed Three Arrows Capital hedge fund.
You may recall these guys from a sublime takedown in New York magazine last summer. The piece, titled “The Crypto Geniuses Who Vaporized a Trillion Dollars,” exposed how unlimited greed and faith in their own bullshit led the pair to destroy both their fund and a good chunk of the crypto market. Now, we learn from the Times that the pair don’t possess a drop of remorse. Instead, they are living their best life in Bali—doing shrooms, learning to surf, and posting selfies with captured tigers. And saying things like, “You eat very fatty pork dishes, and you drink a lot of alcohol, and you go to the beach and you just meditate. You have these magical experiences.”
Super douches indeed. This episode made me wonder, though, whether this sort of awfulness is deeper and more prevalent in crypto than elsewhere. It’s easy to think that it is. After all, the last bull market produced not only an endless series of charlatans and scams but also a bro culture that produced the mantra “have fun staying poor.” And in the case of the Three Arrows bros, one of them was known for making the case that crypto had entered a “super-cycle” that would not go down.
It’s this combination of greed and selfishness—often wrapped in some blather about crypto bringing democracy or freedom—that makes it so off-putting to many. That said, I don’t think that crypto bros like the Three Arrows pair are worse or more prevalent than other types of bro hustlers.
Bloomberg’s Matt Levine says as much, likening the Three Arrows duo to Adam Neumann, who turned the startup WeWork into a debacle for the ages. He says the business model of seeing a bubble and then ruthlessly sweet-talking investors out of their money is the same. In Neumann’s case, Levine explains the hustle consisted of “Scale the fastest, talk the most nonsense, have the worst unit economics and raise the most money by bro’ing down the most with SoftBank’s Masayoshi Son.”
The Three Arrows founders didn’t have their hooks into Son, a fund manager famous for bad decisions, but they were instead able to extract enormous sums from those behind the now-busted crypto lending services Voyager, Celsius, and Genesis. And like Neumann, they’re now living large and totally indifferent to the wreckage they caused.
The bottom line is that bad crypto bros are no worse than their counterparts in tech or other industries. The harder question is how these people can stand themselves after failing in ways that would make the rest of us deeply ashamed for years.
Jeff John Roberts
[email protected]
@jeffjohnroberts
DECENTRALIZED NEWS
Robinhood's crypto trading volume fell 43% in May, to $2.1 billion, and the company has since delisted three of the tokens it offered. (Coindesk)
A video has surfaced from 2018 that shows future SEC Chair Gary Gensler telling hedge funds that Ethereum and Litecoin are "not securities." (Fortune)
A judge ruled that crypto fund Galaxy had a "clean termination right" in walking away from a $1.2 billion acquisition of BitGo after the latter failed to furnish clean audits. (Bloomberg)
Solana executives are putting on a brave face despite their the token being named a security, while developers appear indifferent to the new legal peril. (Fortune)
A JPMorgan analyst note predicts U.S. exchanges like Coinbase will have to register with the SEC, and that the dominance of Ethereum is likely to grow. (The Block)
MEME O’ THE MOMENT
This is the web version of Fortune Crypto, a daily newsletter. Sign up here to get it delivered free to your inbox.
