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Effective Altruism Is Bunk, Crypto Is Bad for the Planet, and Other Basic Truths of the FTX Crash

The overarching lesson of Sam Bankman-Fried’s downfall is that the gauzy philosophical natterings of CEOs are just meant to distract us from their real goal: accumulating cash without interference.

Craig Barritt/Getty Images for CARE for Special Children
Sam Bankman-Fried (right) and One Step Up CEO Harry Adjmi attend the Moonlight Gala benefiting children with special needs on June 23, in New York City.

Twitter’s implosion isn’t the only astonishing story in the tech world this week. There’s also the collapse of FTX, a cryptocurrency exchange led by its 30-year-old founder, Sam Bankman-Fried, who is now under investigation by federal regulators for multiple wrongdoings and by the public for reportedly being a member of what may now be the world’s most despised polycule. What’s made the FTX unraveling so shocking is that Bankman-Fried was thought to be special—the reasonable voice of a Wild West industry. He was also believed to be in possession of a moral compass. Now, as headlines about FTX proliferate, people are starting to question the philosophy of “effective altruism,” which Bankman-Fried promoted and claimed to live by. This rethinking of effective altruism may be the one bright spot in an otherwise depressing crash that may devastate many vulnerable people. Despite its good reputation in some affluent and influential quarters, the effective altruism philosophy has always contained quite a bit of dangerous nonsense.  

The goal of effective altruism—a philosophy and “social movement”—is to “try to find unusually good ways of helping, such that a given amount of effort goes an unusually long way,” according to That can mean donating a kidney, spending money on pandemic preparedness, or attempting to ward off space crimes in the year 3423. The actions of effective altruism devotees are guided by a few core principles, including “prioritization.” “The goal is to find the best ways to help, rather than just working to make any difference at all,” using “numbers,” the group’s website states. Decisions should be impartial so as to “give everyone’s interests equal weight.” Adherents are committed to open truth-seeking, finding the most rational ways to make change rather than “starting with a commitment to a certain cause, community, or approach.” E.A. acolytes pride themselves, that is, on a cool rationality that rejects the emotional satisfaction of helping someone face to face or having the kinds of material or emotional stakes in an issue that organizers use to enlist recruits into union drives or grassroots movements pushing systemic change. 

It’s that reasoning that leads the E.A. career-advice site 80,000 Hours—featuring a testimonial from Bankman-Fried himself—to rank climate change seventh on a list of the world’s most pressing problems. Climate change, this site claims, is dangerous mainly for its potential to exacerbate other, more grave existential threats like pandemic or nuclear war. The case for that is as follows: “If climate change poses something like a 1 in 1,000,000 risk of extinction by itself, our guess is that its contribution to other existential risks is at most a few orders of magnitude higher—so something like 1 in 10,000.” Numbers! 

The most pressing threat, this site claims, is superpowered artificial intelligence at some point executing a plan to kill or enslave all of humanity. The unlikely event of the world warming by 13 degrees would constitute “a humanitarian disaster of unprecedented scale,” per an 80,000 Hours issue brief. But even at those temperatures, “it seems very likely that we could adapt to avoid extinction (for example, by building better buildings and widespread air conditioning, as well as building more in the cooler areas of the Earth),” the guide writes. “​​We would have to live in a much smaller area, but civilisation would survive.”

Effective Altruism’s intellectual grandfather is utilitarian Peter Singer. But its best hype man is Oxford philosopher William MacAskill. His particular hobby horse is something called “longtermism,” spelled out in his latest book, What We Owe the Future. As Alexander Zaitchik summarized in his excellent review for this magazine, longtermism “posits that one’s highest ethical duty in the present is to increase the odds, however slightly, of humanity’s long-term survival and the colonization of the Virgo supercluster of galaxies by our distant descendants.” Our chief concern should be the trillions of people who’ll live on Earth for hundreds of thousands, if not billions of years to come. Oddly, the rationale for climate change not being a more pressing threat to E.A.s is that it would take “some time (decades or maybe centuries)” for extreme levels of warming to develop via the burning of every fossil fuel reserve currently in the ground. 

MacAskill, who seems to have personally recruited Bankman-Fried to the E.A. community, has now condemned Bankman-Fried on Twitter for failing at effective altruism. “I had put my trust in Sam, and if he lied and misused customer funds he betrayed me, just as he betrayed his customers, his employees, his investors, & the communities he was a part of,” MacAskill tweeted last week. To demonstrate that Bankman-Fried’s actions were inconsistent with effective altruism and that therefore Bankman-Fried’s fall does not discredit the movement, MacAskill posted a few sections from his book that emphasize the need to live a “rounded ethical life.” The ends do not always justify the means, MacAskill argues in these segments, even if they might theoretically save billions of lives in the far-off future. And it’s “particularly important to avoid doing harm,” he writes. 

But like much of E.A., this sidesteps some more basic ethical issues under capitalism—issues highly relevant to the FTX collapse. Quite simply: There is no ethical or nonharmful way to make a billion dollars in an economic system rife with—and arguably premised on—exploitation and passing the true costs of a product on to others. To MacAskill, creating a Ponzi scheme and gambling away customer savings is beyond the pale. The ordinary exploitation involved in the process of accumulating extraordinary wealth—low wages, poor working conditions, and union busting—is all copacetic. 

In the case of crypto, especially, amassing wealth has tended to come with a massive carbon footprint. Bitcoin mining using so-called proof of work operations is extraordinarily carbon intensive. Shuttered coal and gas-fired power plants in the United States have surged back to life to mint cryptocurrency, sparking pushback from lawmakers in New York and elsewhere. The practice uses more electricity than the country of Norway and its 5.3 million inhabitants. Attempts to switch to another, much less emissions-intensive method called “proof of stake” have so far been a mixed bag. While Ethereum underwent a high-profile switch, old mining devices are still being put to work. Though pollution from fossil fuels accounts for one in five deaths worldwide, E.A. enthusiasts could undoubtedly offer a lengthy explanation as to why more emissions are ultimately justified in the name of battling intergalactic genocide. 

Effective altruism is the gospel of wealth for guys who fashioned their personalities in high school around subjecting their criminally underpaid teachers to debates about whether God exists. The implicit reasoning behind the philosophy is that the big, powerful brains earning fortunes are also the best equipped to figure out how they will make the world a better place. Any rube can go work at a nonprofit. Making a real difference might just mean getting filthy rich (“earning to give”), as MacAskill once told Bankman-Fried over lunch. 

“Rich makes right” is not exactly revolutionary stuff. “Doing good by doing well” has been a long-held mantra of Davos types spewing TED-talkish bromides about wanting to make the world a better, greener place. “The laws of accumulation will be left free; the laws of distribution free. Individualism will continue,” steel magnate Andrew Carnegie wrote of his class’s charitable giving in 1899, “but the millionaire will be but a trustee for the poor; entrusted for a season with a great part of the increased wealth of the community, but administering it for the community far better than it could or would have done for itself.” Bizarrely, though, E.A. has been successfully marketed as new and innovative, mostly by dint of its proximity to tech. 

To be fair, E.A.-aligned think tanks like Open Philanthropy have sent money to plenty of worthy causes, including journalism and nonprofits interested in tackling the root causes of what makes the world suck. Some E.A. adherents are merely self-congratulatory do-gooders. Some are people who have landed themselves in high-paying jobs yet have some vague sense that the world is bad and want to help out. Donating kidneys and mosquito netting isn’t exactly a bad thing. There may well be some way for E.A. to continue the good it’s doing in the world without Bankman-Fried and other wealthy backers. But on a basic material level, crypto and the institutions guiding E.A. remain deeply intertwined—so much so that many recipients of E.A. funds are now facing dire shortfalls amid the FTX implosion. 

Bankman-Fried more or less admitted this week that his ethical commitments were mostly a scam. When prompted by Vox’s Kelsey Piper over Twitter D.M.s to discuss the discrepancy between his public talk about ethics and his true perception of finance as a “game,” he responded, “ya,” and “hehe,” adding that he “had to be” good at talking about ethics since “it’s what reputations are made of.” Ethics in corporate culture, he added, is “a dumb game that we woke westerners play where we say all the right shiboleths and so everyone likes us.”

As he also told Piper, “Fuck regulators.” Any talk about wanting to make good regulations on crypto was “just PR,” he confirmed. To him, regulators are useless, inept drains on businesses. Regulators are obsessed with a “giant Crackdown on Big Tech” and are “undermining US interests globally.” He called the Office of Foreign Assets Control—the enforcement arm of the U.S. Treasury, which also administers trade sanctions—“the single biggest threat to the US being a suprepower.” Echoing the Republicans who have deemed so-called environmental, social, and corporate governance, or ESG, investment decisions a special enemy in recent years, on the theory that Wall Street banks are biased against fossil fuels, Bankman-Fried complained that “ESG has been perverted beyond recognition.” 

Reading this rant over Twitter D.M.s, it’s hard to avoid the conclusion that the E.A. philosophy Bankman-Fried claimed to believe in is beside the point: Bankman-Fried is a garden-variety reactionary who wants to keep the government out of his business. Debating whether he did all this to serve some greater good is academic, leaning toward absurd.

It was already clear before the FTX implosion that Bankman-Fried spent plenty of money not to make the world a better place but to influence policymakers, quickly becoming one of the largest donors to Democratic candidates. He gave $5 million to Joe Biden’s presidential campaign and had pledged to put $1 billion toward supporting Democrats in 2024. This probably wasn’t because he’s a progressive at heart: Reporting by The American Prospect found that two Democratic-supporting political action committees funded by Bankman-Fried, Web3 Forward and GMI PAC, backed candidates based on how friendly they would be to the crypto industry—including on its considerable greenhouse gas emissions. These PACs sent questionnaires to candidates on these issues. As David Dayen writes: 

A section in one questionnaire labeled “Protecting the Environment” claims that Bitcoin “proof of work” mining, which has been criticized for using extreme amounts of energy, is actually a boost to a clean-energy electric grid, while using “2.5 times less energy than the banking system per dollar of value.” 

The Prospect asked Web3 Forward and GMI PAC to provide sources for this, but they have not responded. As the questionnaire even concedes at one point, the arguments appear to be based on theories from proof-of-work mining participants themselves. Independent energy experts have scoffed at the claims.

Questionnaires also asked candidates to pledge to support a letter to Gary Gensler, commissioner of the Securities and Exchange Commission, urging him to back off the industry. The letter was ultimately signed by both Republicans and Democrats, including Representatives Josh Gottheimer, Jake Auchincloss, Darren Soto, and Ritchie Torres. As The Lever reported, the Bankman-Fried-backed super PAC Protect Our Future spent millions this cycle, including to elect candidates who sit on committees relevant to the crypto industry. Bankman-Fried personally co-hosted a fundraiser for Torres with Democrat-aligned pollsters David Shor and Sean McElwee. The latter was reportedly an adviser to Bankman-Fried, whose group Data for Progress received $48,000 from Protect Our Future.  This is all very ordinary behavior for a billionaire getting involved in politics. Real or fake, the sheen of effective altruism seems to have fooled plenty of people into thinking Bankman-Fried was extraordinary

It’s good that FTX’s collapse is finally making people rethink Bankman-Fried and effective altruism. But the problem with effective altruism isn’t that it’s populated by insufferable dweebs. The problem is these dweebs’ alliance with a profoundly anti-democratic project: to let rich people continue to make as much money as possible, whatever the cost to people and the planet.