I like a good conspiracy theory, but it's unrealistic to expect that the investors knew about this.
If they did, they would know there'd be a 100% chance that it would blow up.
This is some serious balance sheet depravity. This is not like the CEO buying up companies with a conflict of interest, or billing the company for their private jet. All of that is plausibly legit.
When there are no financial controls at all, money is being looted, it will go down.
VC funds normally don't do due diligence so long as some other entity did it in the round, there is legit oversight on the board etc.. in this case, their own controls failed.
All of the funds who invested in FTX need a serious audit of policy.
This is a dereliction of responsibility, not just a 'bad bet' and so heads should roll. They probably won't though.
If they did, they would know there'd be a 100% chance that it would blow up.
This is some serious balance sheet depravity. This is not like the CEO buying up companies with a conflict of interest, or billing the company for their private jet. All of that is plausibly legit.
When there are no financial controls at all, money is being looted, it will go down.
VC funds normally don't do due diligence so long as some other entity did it in the round, there is legit oversight on the board etc.. in this case, their own controls failed.
All of the funds who invested in FTX need a serious audit of policy.
This is a dereliction of responsibility, not just a 'bad bet' and so heads should roll. They probably won't though.