Recently, after Sam Bankman-Fried’s conviction on seven charges of fraud related to his role in crypto craziness, there has been a ton of publicity around Michael Lewis’s book about SBF. I’ve been generally astonished, fascinated, and horrified by the gullibility of investors, and was curious enough to be happy to receive a copy of Number Go Up by Zeke Faux from Crown Publishing and NetGalley in exchange for my honest review. Subtitled “Inside Crypto’s Wild Rise and Staggering Fall, it is a terrific story told by Faux, an investigative reporter for Bloomberg Businessweek and Bloomberg News. He really knows the world of finance inside and out and can talk about it in a way that doesn’t make my eyes instantly glaze over…
The publisher’s blurb made me think this book might be enjoyable as well as informative: Compared to Going Infinite by Michael Lewis, reviewers say Number Go Up is “more nuanced” (The Washington Post), “more entertaining” (Los Angeles Times), and “far superior” (Wired), not to mention “rollicking” (The Economist), “laugh-out-loud funny” (Fortune), and “shrewdly skeptical” (The New York Times).
Around 2013, the best-known crypto (Bitcoin) started to be talked about everywhere. Then there was a huge crash followed by the price mysteriously increasing tenfold. “Years later, researchers would find that the spike was the result of fake trades and price manipulation, but by then the idea of getting rich on Bitcoin had entered the popular imagination.” The price went up “…because it had gone up. They wielded this circular argument to ward off doubt…It became a mantra: Number go up.”
Faux throws around a lot of names, including Celsius, “a bankrupt cryptocurrency lending platform and crypto interest account provider,” Tether, “a blockchain-enabled platform designed to facilitate the use of fiat currencies in a digital manner,” and other companies and strategies, both real and not so real. Faux has a way with words as he explains the problems with crypto to even an unenlightened reader such as myself: “Somehow Celsius had accumulated as much money as a large hedge fund with a business plan that wouldn’t even work for a kid’s lemonade stand.” And then there are the exchanges:”…crypto exchanges, like Bankman-Fried’s FTX, were essentially giant casinos.”
The exchanges have one job: to keep cash and crypto safe…but as Faux explains, they’ve failed miserably. Mt. Gox, a former trading card website, proved to be “a bad custodian for billions of dollars.” (What a surprise). As it turns out, there isn’t a mainstream use for cryptocurrency, and there has been an amazing amount of fraud.
SBF was among the worst: he “…had discredited the only use anyone had come up with: semi-legal gambling.” It’s a great story, and Faux is a fantastic storyteller who can make readers LOL while cringing. It’s timely, informative, scary, and incredibly well sourced. How well sourced? Faux interviewed over 200 people for the book, and did a ton of research. I was surprised to see the Epilogue begin when I was at the 57% mark and the Notes at 62%. There are also lots of great photos. If you are at all interested in the topic, this is the book for you. Highly recommended. Five stars.