FTX Does Some Effective Altruism

Remember FTX? It was wild. FTX was a crypto exchange that collapsed in bankruptcy and fraud charges in late 2022. Before that, though, it was a wildly lucrative business, run sloppily by inexperienced young people out of luxury apartments in the Bahamas, with a distinctive charitable mission. FTX was associated with the Effective Altruism (EA) movement, and its founder, Sam Bankman-Fried, was explicitly looking to earn a lot of money to give to effective charities. I once said to him that he was “in the business of funneling money from people who are going to use it poorly on gambling to, like, animal charities and pandemic preparedness and Joe Biden,” and that was before I knew about the fraud stuff. Even the good story of FTX was that it was a vast machine for extracting money from crypto traders and giving it to effective altruism charities.

In that vein, in April 2022, FTX hired a guy named Ross Rheingans-Yoo to work at the FTX Foundation, its charitable arm.1 His employment agreement — “a shared Google Document, ‘Final Ross Terms’” — promised him “a discretionary bonus of at least $1 million,” to be paid half in cash and half in a donation to a charity of his choice. Very FTX: $1 million seems like a nice paycheck for a nonprofit employee, and getting half of his pay in charitable donations was very EA of Rheingans-Yoo. 2