#ftx founder

[wauln]

[ FTX Founder Sam Bankman-Fried Found Guilty ]

[cryptonewsupdate]

Decoding Crypto Market Turbulence: Vitalik Buterin's Analysis in the Aftermath of FTX's Collapse

Vitalik Buterin, the co-founder of Ethereum, has recently offered profound insights into the rapidly changing landscape of the cryptocurrency market, particularly in the aftermath of the collapse of FTX. In a reflective post on X, Buterin recounted his experiences with the next generation of innovators, moving away from his earlier perception as a "fancy young wunderkind" to embrace a new era of transformative leadership in the dynamic crypto industry.

Buterin's journey also extends beyond blockchain technology, as he shared his advocacy for life extension and offered a nuanced perspective on the meaning of life. He emphasized the inevitability of change, highlighting his shift from a mathematical-centric worldview to an appreciation of the complexity of social systems and the limitations of attempting to create foolproof governance mechanisms.

The Ethereum co-founder discussed the transformations he underwent, moving from deep immersion in mathematics, coding, and cryptographic protocols to a more balanced approach that uses mathematics to offer initial insights into social mechanisms. He reflected on global events, specifically the Ukrainian crisis in 2022, and observed the public downfall of influential figures like Sam Bankman-Fried and FTX. This prompted Buterin to reevaluate figures he once admired in the crypto space, recognizing that the community was undergoing a transformation with many influential figures facing challenges.

In response to these realizations, Buterin emphasized the importance of intentional action, departing from his past inclination to follow others' plans. Whether confronting geopolitical issues or shaping the future of the crypto space, he stressed the need for a high-agency approach, recognizing the imperative to actively contribute to positive developments. Overall, Buterin's reflections provide valuable insights into the evolving nature of the cryptocurrency industry and the role of transformative leadership in navigating its complexities.

[wilwheaton]

The tech industry is getting increasingly scammy. True innovation has slowed down drastically in recent years, threatening to shrink the staggering profits from the earlier parts of the century. To replace that income, tech leaders have increasingly turned to overhyped products or even outright fraud, as evidenced by the collapse of the FTX cryptocurrency exchange and imprisonment of its founder. Joe Biden's administration has made shutting down consumer fraud a majority priority. Rather than dial back the shady behavior, the tech industry is turning to Donald Trump, a man whose entire business career was built on fraud, to save them.

A viral blog post from a bureaucrat exposes why tech billionaires fear Biden — and fund Trump

[dostoyevsky-official]

Billion dollar squirrel: Trump effect fuels crypto’s ‘memecoin’ boom

Cryptocurrencies representing a euthanised grey squirrel, a Thai pygmy hippopotamus and a cartoon dog have exploded in value since last month’s US presidential election, as Donald Trump’s victory triggers a surge in speculation in so-called memecoins. The market for tokens representing online viral moments has expanded rapidly since early November as traders bet that Trump’s administration will usher in more crypto-friendly attitudes and regulation in Washington. “They have no value, they never will have value,” Charles Hoskinson, co-founder of the Cardano blockchain, said about memecoins recently. “There’s no utility behind them, nobody wants them — when they lose their lustre they go to zero.” The total market value of CHILLGUY has reached $466mn since it was created two weeks ago. It received a boost when MrBeast, the world’s most popular YouTuber, wrote on X last week that it was the “biggest meme of our lifetimes”. The memecoin frenzy has inspired others to get involved. Haliey Welch, who went viral this year as Hawk Tuah Girl, said last week she would soon launch a token “to unite her entire community”. The market size of PNUT has hit $1.2bn, while PEPE, referencing a comic frog character, has a market cap of $8.2bn — more than that of British supermarket chain Sainsbury’s. BONK, a cartoon dog made after the collapse of exchange FTX in an effort to cheer up traders using the Solana blockchain, has a market cap of $3bn. “Most of these fail and have no liquidity,” said Adam Morgan McCarthy, research analyst at Kaiko. But “these things are like Lazarus if a community gets behind them in force”. [...] “It’s got a little bit silly and it feels . . . like what happened towards the end of the NFT market,” said Geoff Kendrick, global head of digital assets research at Standard Chartered. “At some point, something will happen which will unleash the house of cards and it’ll collapse.”

[sarkos]

The disgraced cryptocurrency mogul Sam Bankman-Fried, who founded the FTX exchange, had planned to purchase the small Pacific island nation of Nauru in case the world came to an end, according to a new lawsuit. The lawsuit, filed on Thursday by FTX against its 31-year-old founder and three other former executives, and seeking $1bn, included a memo created by Bankman-Fried’s younger brother Gabriel and an FTX Foundation executive. The memo detailed plans to buy Nauru. The plan was to “purchase the sovereign nation of Nauru in order to construct a ‘bunker/shelter’ that would be used for ‘some event where 50-99.99% of people die [to] ensure that most EAs survive’�� the memo said, referring to “effective altruism”, a philosophical and social movement championed by Bankman-Fried that tries to maximize the impact of charitable giving. The memo also noted plans to develop “sensible regulation around human genetic enhancement, and build a lab there”. It also said “probably there are other things it’s useful to do with a sovereign country, too”.

Bankman-Fried planned to buy Nauru and build apocalypse bunker – lawsuit | Sam Bankman-Fried | The Guardian

“The Boys from Nauru” just doesn’t have the same ring

[collapsedsquid]

The ex-FTX CEO’s diet sees him get vegan meals that fellow inmates think “literally [smell] like shit” so he lives on beans and rice — the latter has “become one of the currencies of the realm inside MDC.” The alum of trading house Jane Street Capital and co-founder of trading firm Alameda Research reportedly joked about how much better the arbitrage opportunities are in jail compared to his former life as a high-frequency trader.

confused by this story, is he the only one that gets rice? Is it the rice that smells like shit? Tell me your prison rice-trading business secrets SBF!

[mariacallous]

A US judge has cleared the way for billions of dollars to be refunded to former customers of bankrupt crypto exchange FTX.

At a court hearing in Wilmington, Delaware, on Monday, judge John Dorsey gave final approval to FTX’s reorganization plan, the terms of which had previously been put to creditors and voted through by a landslide.

“I think this is a model case for how to deal with a very complex Chapter 11 proceeding,” said Dorsey. “I applaud everyone involved in the negotiation process.”

FTX filed for bankruptcy in November 2022 after running out of funds to process customer withdrawals. Billions of dollars’ worth of FTX customer deposits were missing. The money, a jury later found, had been swept into a sibling company and spent on high-risk trading, venture bets, debt repayments, personal loans, political donations, luxury real estate, and other illegitimate dealings.

A year later, FTX founder Sam Bankman-Fried was convicted of multiple counts of fraud and conspiracy, then sentenced to 25 years in prison. In September, coconspirator Caroline Ellison received a two-year prison term after testifying against Bankman-Fried at trial.

First proposed in May, the FTX bankruptcy plan charts a path to a full refund, plus interest, for former FTX customers—a level of recovery rarely seen in bankruptcies. “Generally, anything over 100 cents on the dollar is close to miraculous,” says Yesha Yadav, associate dean and a bankruptcy specialist at Vanderbilt University Law School. “What tends to happen is that unsecured creditors get cents on the dollar, if they’re lucky. The expectation is that it is a process of scarcity.”

In this case, though, the administrators of the FTX estate were able to recover billions of dollars by liquidating investments made by the exchange’s venture capital arm, FTX Ventures, and its sister company, Alameda Research, along with other assets. A rise in the price of cryptocurrencies in the period since FTX filed for bankruptcy, meanwhile, raised the value of the coins left in exchange coffers.

Under the plan, government bodies in the United States—including the Internal Revenue Service and the Commodities and Futures Trading Commission—have agreed to suspend high-value claims against FTX until creditors had been repaid (although the IRS will receive a $200 million upfront payment as part of the settlement).

Even FTX equity holders, typically the last to be repaid in a bankruptcy, stand to make back a portion of their initial investment—a maximum of $230 million between them—paid for using funds recovered by the Department of Justice through the prosecution of FTX insiders.

But despite the abnormally high expected recovery, some creditors believe they are still getting a raw deal by virtue of the way their claims have been valued.

Many customers held crypto assets like bitcoin on the FTX platform, but through a process called dollarization common to bankruptcies, their claims have instead been assigned a dollar value based on the price of those assets on the date of the bankruptcy filing. When FTX fell, the crypto market was in the doldrums, but it has since lurched to new all-time highs, meaning some customer claims would be far more valuable if the refund were mapped to the present value of crypto assets. Therefore, though dollarization is proper under the bankruptcy code, “saying [the return] is over 100 percent is just wrong,” says Yadav. “For the average person, it’s very far from that.”

Among the parties that stand to gain the most from the approval of the plan, meanwhile, are investment firms that spent millions of dollars purchasing claims from people with assets stuck in FTX, who either preferred to take a haircut and reinvest the money or had urgent need of the funds. Those claims were typically purchased at a cut-price rate before a handsome recovery was considered likely—some for less than 10 cents on the dollar—but are now worth multiples of that.

“In terms of internal rate of return—holy shit. It’s the best trade I’ve seen in my lifetime,” says Thomas Braziel, cofounder of 507 Capital, an investment firm that specializes in buying up bankruptcy claims and took a large position in FTX, and 117 Partners, which brokers claim sales. (In July, Braziel was ordered by a Delaware court to repay $1.9 million that he misappropriated as receiver of failed financial services company Fund.com to make investments and luxury purchases.)

In August, a number of former FTX customers filed formal objections to the plan with the bankruptcy court. The customers objected, variously, to the legal immunity provided under the plan to those that have administered the bankruptcy, the likelihood that cash payments would trigger costly taxable events for creditors, and other elements of the plan. “I felt vindicated when Bankman-Fried went to jail—and I believed that would flow through to bankruptcy court,” says Sunil Kavuri, one FTX customer to cosign an objection. “I’ve been unpleasantly surprised.”

In the course of the five-hour hearing, Brian Glueckstein, an attorney at law firm Sullivan & Cromwell and counsel to FTX, responded to each objection in turn. “There is no evidence on the record that somehow these debtors are not providing maximum value—none,” said Glueckstein.

In providing his approval, the judge rejected the pending objections and cleared the way for FTX administrators to begin to execute the plan.

It remains possible to lodge an appeal against the plan after its confirmation in limited circumstances. Logistical complications may also delay repayments to creditors, expected to begin late this year at the earliest. But few realistic options now remain for parties hoping to change the course of the FTX bankruptcy.

The confirmation hearing “is the last chance in a practical sense for changes to be made,” says Yadav. “This is the defining day.”

[karagin22]

Wonder how sooner before he is telling names or we hear about....

[posttexasstressdisorder]

[azspot]

The defense is requesting a 12-hour extended release 20mg dosage of Adderall, for Bankman-Fried. If the requested dose is not provided, or fails to have the desired effect, the defense is asking that the trial be adjourned on Tuesday, October 17, to address this issue.

[keepingitcountryon]

FTX's Sam Bankman-Fried has $250 million bail revoked https://mol.im/a/12397893 via https://dailym.ai/android

[beardedmrbean]

Sam Bankman-Fried, once hailed as a genius in cryptocurrency, was found guilty Thursday of all fraud counts against him, a year after his exchange, FTX, imploded and practically wiped out thousands of customers.

The verdict was reached around 7:40 p.m. ET, about four hours after the federal jury in Manhattan began deliberations.

Bankman-Fried, a co-founder of the digital currency exchange FTX, was charged with seven counts of wire fraud, securities fraud and money laundering that swindled customers of FTX and lenders to its affiliated hedge fund, Alameda Research.

Bankman-Fried “perpetrated one of the biggest financial frauds in American history,” Damian Williams, the U.S. attorney for the Southern District of New York, said after the verdict.

“The cryptocurrency industry might be new; the players like Bankman-Fried might be new,” Williams said. “But this kind of fraud, this kind of corruption, is as old as time.”

Bankman-Fried faces up to 110 years in prison. His sentencing is scheduled for March 28.

FTX and Alameda quickly collapsed in November 2022 after some of their financial liabilities were exposed. The fact that Alameda had taken billions of dollars from FTX's customers and that much of Alameda's balance sheet comprised digital currency assets it had created, was central to the case against Bankman-Fried.

Unnerved by disclosures about the firm's financial position, many of FTX’s customers tried to get their money back. That set off the equivalent of a bank run.

The value of Alameda's investments crashed, and FTX couldn’t return much of that money because it had been given to Alameda. Some went to the fund’s lenders, and billions were spent on sponsorships, commercials and loans to top executives. That, too, was a major part of the case against Bankman-Fried.

Many of FTX and Alameda's leaders were also charged after the firms went under. Former Alameda CEO Caroline Ellison, FTX co-founder Gary Wang and FTX head of engineering Nishad Singh all pleaded guilty. They agreed to cooperate with the prosecution and testify against Bankman-Fried in exchange for lighter sentences.

While Bankman-Fried testified in his own defense, it didn’t appear to have the same weight as the insider testimony against him. The prosecution, in its closing argument, said Bankman-Fried had answered “I can’t recall” 140 times while he was being cross-examined.

Bankman-Fried’s lawyers contended that he did not intend to defraud anyone and that the government was looking for someone to blame after the failures of FTX and Alameda.

Bankman-Fried was asked to rise and face the jury as the verdicts were read Thursday, and he did so. He showed little emotion as each verdict was read.

His father slumped in his seat, hunched over as each guilty verdict came in. His mother was visibly emotional.

Mark S. Cohen, Bankman-Fried’s counsel, said in an emailed statement Thursday that Bankman-Fried’s legal team respects the jury’s decision but that they are disappointed.

“Mr. Bankman Fried maintains his innocence and will continue to vigorously fight the charges against him,” he said.

Forbes had once estimated that Bankman-Fried's stakes in Alameda and FTXwere worth $26 billion. He was 29 at the time. But after the bankruptcies, that was gone. Criminal charges followed weeks later.

He also faces another trial on charges of bribing foreign officials and other counts. That trial is scheduled to begin in March, and he has pleaded not guilty to all charges.

On Thursday, Bankman-Fried was found guilty of two counts of wire fraud conspiracy, two counts of wire fraud, one count of conspiracy to commit money laundering, one count of conspiracy to commit commodities fraud and one count of conspiracy to commit securities fraud.

Williams, the prosecutor, said Bankman-Fried’s conviction should send a message to others.

“It’s a warning, this case, to every single fraudster out there who thinks that they’re untouchable or that their crimes are too complex for us to catch or that they’re too powerful for us to prosecute or that they could try to talk their way out of it when they get caught,” he said. “Those folks should think again.”

[collapsedsquid]

If only FTX had stayed active a little longer, Trump could have conned him out of $5 billion

[mediamonarchy]

https://mediamonarchy.com/wp-content/uploads/2024/05/20240514_MorningMonarchy.mp3 Download MP3 Devastating hits, Bezos’ DARPA grandad and Pokémon maps + this day in history w/U.S. moves Jerusalem Embassy and our song of the day by Macklemore on your #MorningMonarchy for May 14, 2024. Notes/Links: Are BRICS Bucks coming soon? BRICS: Prepare for US Dollar Collapse, IMF Warns https://watcher.guru/news/brics-prepare-for-us-dollar-collapse-imf-warns Australia’s Tax Office Tells Crypto Exchanges to Hand Over Transaction Details of 1.2 Million Accounts: Reuters; The ATO said the data will help identify traders who failed to report their cryptocurrency-related activities. https://www.coindesk.com/policy/2024/05/07/australias-tax-office-tells-crypto-exchanges-to-hand-over-transaction-details-of-12-million-accounts-reuters/ FTX customers get good-bad news as the bankrupt exchange rides the crypto rally https://sherwood.news/snacks/crypto/ftx-customers-get-good-bad-news-as-the-bankrupt-exchange-rides-the-crypto/ GameStop shares surge 70% as meme stock craze returns https://www.cnbc.com/2024/05/14/gamestop-amc-shares-jump-another-40percent-in-premarket-trading-as-meme-stock-craze-returns.html Full list of closures as major bank to shut 36 branches and cut hundreds of jobs https://news.sky.com/story/tsb-to-close-36-branches-and-cut-hundreds-of-jobs-13131574 Video: TSB to close 36 branches with 250 jobs devastatingly hit (Audio) https://www.youtube.com/watch?v=9juP3_SZxAk Laura Loomer Accuses Democrat Politician Who Told Trump to ‘Go Back to Court’ of Illicit Profiteering from Hush Money Trial https://archive.ph/Og5Ny Elon Musk, David Sacks Holds Secret ‘Anti-Biden’ Gathering of Billi https://californiaglobe.com/fr/elon-musk-david-sacks-holds-secret-anti-biden-gathering-of-billionaires/ Melinda French Gates steps down from Gates Foundation, retains $12.5 billion for additional philanthropy; The Gates Foundation has, over three decades, made $77.6 billion in charitable contributions, making it one of the world’s largest donor organizations. https://www.nbcnews.com/business/business-news/melinda-gates-stepping-down-from-gates-foundation-rcna152001 FBI File on Jeff Bezos’ Grandfather, a DARPA Co-Founder, Has Been Destroyed https://vigilantnews.com/post/fbi-file-on-jeff-bezos-grandfather-a-darpa-co-founder-has-been-destroyed/ Video: America’s Book Of Secrets: DARPA’s Secret Mind Control Technology (Audio) https://www.youtube.com/watch?v=wZRkfBsTTt8 EU’s Controversial Digital ID Regulations Set for 2024, Mandating Big Tech Compliance by 2026 https://reclaimthenet.org/eus-controversial-digital-id-mandating-big-tech-compliance-by-2026 UK airports latest: ‘Queues only getting bigger’ https://news.sky.com/story/uk-airports-latest-queues-only-getting-bigger-after-london-and-manchester-confirm-nationwide-border-system-issue-13131330 Marvel Rivals apologises after banning negative reviews https://www.bbc.com/news/articles/cd1wwlvd9yko 28 years later, unopenable door in Super Mario 64’s Cool, Cool Mountain has been opened without hacks https://www.tomshardware.com/video-games/28-years-later-unopenable-door-in-super-mario-64s-cool-cool-mountain-has-been-opened-without-hacks Pokémon Go players are altering public map data to catch rare Pokémon https://arstechnica.com/gaming/2024/05/pokemon-go-players-are-altering-public-map-data-to-catch-rare-pokemon/ Video: Pokemon Go Versus OpenStreetMap (Audio) https://www.youtube.com/watch?v=fLPyXy39Sv0 Image: @Hybrid’s Cover Art – Pokemon Go’s ‘Modern Solutions’ https://mediamonarchy.com/wp-content/uploads/2024/05/20240514_MorningMonarchy.jpg May 2014 – Page 6 – Media Monarchy https://mediamonarchy.com/2014/5/page/6/ Flashback: Americans Will Never Have the ‘Right to Be Forgotten’ (May 14, 2014) https://mediamonarchy.com/americans-will-never-have-right-to-be/ Flashback: Modern Pope Gets Old School On The Devil (May 14, 2014) https://mediamonarchy.com/modern-pope-gets-old-school-on-devi/ Flashback: Frugal US Consumers Make It Tough for F...

[mariacallous]

As Donald Trump took the presidential oath for a second time, he was surrounded by some of the world’s richest men. But even a famously materialistic president couldn’t outdo the Chinese Communist Party (CCP) when it comes to collecting billionaire support. In March 2018, more than 100 billionaires gathered in Beijing to serve in the Chinese government. Pony Ma, the CEO of web giant Tencent and then China’s richest man, sat alongside Evergrande chairman Hui Ka Yan and 40-plus other members of the ultra-rich in the National People’s Congress (NPC), China’s parliament.

Ma’s wealth, at $47 billion, put him just ahead of Hui, worth $41 billion, as China’s richest man. Another 59 billionaires joined the Chinese People’s Political Consultative Conference (CPPCC), the party’s highest advisory body. The net worth of the NPC and CPPCC combined was estimated at more than $620 billion.

But as the “two sessions”—the annual meetings of the NPC and CPPCC—met in Beijing, their actual work was to rubber-stamp Xi Jinping’s abolition of presidential term limits, allowing him to hold power indefinitely. Neither body has any actual power. Giving billionaires a place in the legislature was not a reward or a sign of their strength; it was a way to bind them to the party and for them to publicly show their allegiance.

In much of the world, the defining characteristic of billionaires is impunity: the ability to ignore laws, social norms, or borders through the sheer force of wealth. U.S. billionaires do all they can to evade their responsibilities to the state—or to actively subvert the government for their own ends. Capital, and the laws protecting capital, shields and fortifies them. It’s usually only when their wealth itself turns out to be fraudulent, as with FTX founder Sam Bankman-Fried, that they face jail time.

In China, however, every billionaire’s fortune is built upon a thin foundation: the goodwill of the CCP. At every turn, the ultra-rich, especially since Xi took power, are reminded that their wealth exists at the sufferance of the party—and that it could all be taken away. Careful not to draw attention to themselves or seem to challenge the party’s right to “lead everything,” billionaires’ position in China is inherently precarious.

Even after the abandonment of Maoism, the CCP has never been entirely comfortable with the wealthy. In the 1980s, Chinese leader Deng Xiaoping stated that it was fine for “a few” households and regions to “get rich first,” but he said it about peasants, not billionaires, and added that the rich had an obligation to lift up the poor. The party’s reluctant embrace of private business came with many caveats.

Culturally, though, China embraced wealth from the 1980s on with the eagerness of a starving man falling on a banquet. The phrase “to get rich is glorious,” often falsely attributed to Deng, was popularized in Western coverage by Sinologist Orville Schell. Still, it accurately captured a mood that lasted for decades. After two generations of deprivation and revolutionary austerity, the coming of money, and all the possibilities of money, seemed miraculous.

The party adapted. It wasn’t until the late 1990s that the first mainland Chinese billionaires emerged—and they had a golden sheen about them, even for the government. A newly powerful country was flexing its financial muscles, and billionaires matched that image. The wealthy were celebrated in magazines, self-help books, and TV specials, especially since the roughly leveled playing field meant that they had made their own fortunes, going from restaurant owners to real estate magnates—or in one case from laundress to international trader. “Entrepreneurs” was a favorite term for the successful, without the tinge of negativity given to other terms for wealth from the Maoist era.

In 2002, the CCP reversed its previous policy of shutting out entrepreneurs, who were previously seen as politically suspect. This didn’t lead to businesspeople flocking to the party but instead saw party members flowing into business, where their existing connections proved a serious advantage. Even as private initiative was celebrated, it depended on government backing.

That dynamic was most visible in the real estate sector, which more than tripled its share of national GDP in the 2000s. Local governments needed to sell land in order to meet their financial obligations, and the well-connected could buy it cheap—or shut competitors out altogether, legally or otherwise. (A friend’s uncle bid against connected businessmen in Shandong in 2006; he was kidnapped, had his legs severed, and was left to bleed to death on top of one of his own construction sites.) The loans they needed to buy government land often came in turn from government-run banks, in a cycle of mutual profit. Officials welcomed GDP growth for their careers and bribes for themselves.

Other entrepreneurs found smarter methods of leveraging the needs of local government. In his book China in Ten Words, writer Yu Hua tells the story of one businessman who would “bamboozle himself a reputation as a nationally known entrepreneur.” The businessman went to Beijing to bid on the advertising slots before the much-watched 7 p.m. news broadcast, and after spending an astronomical sum of 80 million yuan, he was hailed as the “Bidding King” by media, winning him and his firm even more free publicity. He then returned to his hometown and called a meeting with local government officials. “My own assets are just a tiny fraction of [80 million],” he told them. “If you back me up, then our city will have produced an entrepreneur famous throughout the nation. If you let me down, then our city will have produced the biggest trickster in the whole country.” Faced with this choice, the city’s leaders ordered the local commercial bank to lend him 200 million yuan.

Yu leaves the businessman unnamed and the story unverified. One candidate for the tale is Jack Ma, the creator of e-commerce giant Alibaba, who shares his hometown of Hangzhou with Yu. Ma emerged as one of the most charming, and nationally celebrated, businessmen of the 2000s, known for his impish grin and patriotic enthusiasm for defeating foreign interlopers such as eBay. By the end of 2018, he was China’s richest man, worth some $39 billion. (China’s billionaires have never cracked the $70 billion mark, which leaves them consistently outside the world’s top 20 richest people.)

Ma was just one of a pantheon of billionaires celebrated as role models by parents and the party alike. In May 2013, two months after Xi took office as president, the second-highest-grossing movie in China was a tale of three future billionaires. American Dreams in China was a thinly veiled retelling of the rise of New Oriental, an English-language education company that became an omnipresent giant in the 2000s, specializing in preparing students to study abroad. Its three heroes, presented as plucky go-getters, were based on New Oriental’s founder, Yu Minhong, whose wealth had just topped the $1 billion mark, and his two venture capital backers.

Yet unlike the legal firewalls and political pull enjoyed by U.S. billionaires, none of this success came with security. The newly wealthy were caught in a bind; their wealth let them buy off local officials, and eventually eclipse them, but as their fame grew, they attracted the attention of higher-ranking officials who demanded their own share of the pie.

Their time was inevitably spent—as anthropologist John Osburg detailed in his 2013 book, Anxious Wealth—maintaining intricate networks of influence, profit, and corruption. It was impossible to rise cleanly: Even if your original business was honest, protecting it required not just bribery but participation in networks of mutual vice. Self-compromise made you trustworthy to others.

And while the CCP was willing to tolerate, and even praise, the fresh crop of billionaires, the authorities also regularly harvested them. Which billionaires fell was a matter of arrogance and chance: The most obviously criminal tended to be culled, such as the murderous Liu Han, executed in 2015, or early fugitive Lai Changxing, but sometimes it was simply having picked the wrong political patron. Each fall acted as a reminder to others to stay in line and also let officials divvy up the assets of the fallen.

The Hurun Rich List, a ranking of the ultra-wealthy put together by British analyst Rupert Hoogewerf since 1999, became known as the “fattened pig list,” with the joke being that so many of its most prominent members were then picked for slaughter by the party. Three researchers in 2012 found that being on the list increased your likelihood of being charged, investigated, or arrested from 7 percent to 17 percent. Others found that just appearing on the list increased the cost of auditors, who perceived it as creating heightened risk. (Hoogewerf disputes this, saying that only 1 percent of those on the list have fallen.)

Political risk has sharply increased under Xi. To the public, he promised a crackdown on the corruption and excess of the 2000s. To his fellow party leaders and elders, he promised a reassertion of the centrality of party power. At first, this manifested mostly as demands for public obeisance to the party. Groveling apologies and vows to follow the party, such as that given in 2018 by ByteDance founder Zhang Yiming over “vulgar” content on one of its apps, became common. But the creation of wealth went on regardless. By 2021, the number of billionaires had peaked at 1,185.

The COVID-19 pandemic, and the three years of lockdowns and controls that followed, made business in China even more dependent on government goodwill. Xi took the pandemic as an opportunity to crush entire business sectors he saw as having grown uncomfortably large or socially threatening. A 32-month crackdown on tech, tightening data regulations and censorship demands and blocking initial public offerings and foreign deals, wiped trillions of dollars off stock market prices. Ma disappeared into years of mandated exile from public appearances after he voiced mild criticism of regulators. Much of the private education sector was made illegal, crashing the value of New Oriental’s stock from $195 to barely over $20 in the course of five months. The number of billionaires fell 36 percent in three years.

Yet the biggest casualty of the pandemic was the one sector the government never intended to touch: real estate. A yearslong collapse has smashed the real estate tycoons who were once mainstays of the Hurun list. Evergrande’s Hui saw his wealth fall under $1 billion in 2023, followed by his detention. The loss of a sector that had come to represent more than a quarter of GDP contributed to an economic crisis that has unnerved the CCP.

That produced the February meeting between Xi and CEOs where he reassured them that the party was ready to offer the private sector new support—but also reinforced his own centrality, with CEOs arranged around him to pay due homage. The billionaires were there to show Xi’s strategic priorities, not their own, with manufacturing and agriculture at the center; Jack Ma was back but pushed to the end of the table.

In an era of unchecked billionaire power in the West, it might be tempting to think China has found a better way. But the tools of party power used against the ultra-wealthy are employed more frequently and more cruelly against the poor and powerless, whether Uyghur families, street vendors, small businesses, or feminist activists.

And one class of the ultra-wealthy remains genuinely untouchable: the family members of party leaders. Xi’s family assets are enormous and also unreportable by any Chinese media. When Bloomberg began reporting on it in 2012, Bloomberg as a firm was threatened with total expulsion from China and acquiesced to official demands to self-censor.

Former Chinese Premier Wen Jiabao’s wife, Zhang Peili, took over the country’s diamond trade while her husband was in office from 2003 to 2013 and accumulated at least $2.7 billion in assets through various business dealings. Those around them might be targeted, such as Zhang’s advisor Desmond Shum, who fled China under Xi, or real estate magnate Xiao Jianhua, who acted as a consigliere for many of Xi’s relatives and was sentenced to 13 years in prison in 2022. But the wealth of the party, like the power of the party, remains unquestioned.