Welcome to your weekly Dark Markets tech-fraud roundup. I’m longtime journalist and sociologist David Z. Morris.

I am flabbergasted and humbled and such to share that Stealing the Future has been dubbed “one of the most important books of the year” by the American Prospect, where Adam M. Lowenstein reviews it alongside Jacob Silverman’s “Gilded Rage.”

Lowenstein writes:

Morris’s account of Bankman-Fried’s rise and fall is riveting. But the book is even more compelling for exposing the hollowness of the myths cultivated by “techno-utopians,” as Morris refers to them, as well as the enablers who cash in on their hype and look the other way (or double down) as the lies and inconsistencies pile up.

Another programming note: If all goes according to plan, I will be livestreaming tomorrow at 11am EST. I’ll be doing a live read-through of Do Kwon’s clemency letter and defense memo, which are amazing artifacts of narcissistic sociopathy.

Streaming is something I’ve wanted to try for a while. In this case, there’s just too much to say to get it all out on Twitter, so here we are. We’ll see what comes of it.

Scroll down for a little taste of just how insane Kwon’s clemency arguments are.

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One of the main themes of one of the most important books of the year is that when the economy is directed by a handful of hyper-wealthy egotists surrounded by yes-men who will never tell them they’re wrong, we wind up wasting a shitload of resources chasing illusions.

“Wasting a shitload of resources chasing illusions” is also, not coincidentally, Tesla’s apparent business model.

The Optimus humanoid “robot” is a sterling example. It’s not a form factor that’s particularly useful in industrial applications, and the AI needed for a humanoid robot to operate independently in real-world situations doesn’t exist yet. But that has never stopped Elon Musk, who has spent nearly a decade selling “Full Self Driving” that doesn’t do that.

The Optimus project seems to be even further and more obviously out over its skis, if this video clip is anything to go by. It seems to show nothing less than an Optimus machine falling over after its remote operator removes a VR headset.

I’m not clear when or where the clip was taken, but it follows a string of similar misrepresentations. Notoriously, the 2022 debut announcement of the Optimus featured some guy dancing awkwardly in a bodysuit. Last year’s Cybercab event also featured obviously “tele-operated” Optimus units (and the above footage could also be from that event).

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If the story behind the scenes is anything like the way Musk has been running Twitter lately, it involved Elon waking up one morning desperate to bail Tesla out of a dizzying stock slump - TSLA 0.00%↑ was down more than 65% for 2022. “Humanoid robots!” he uttered, the first thought that came to his increasingly ketamine-rattled brain.

And then Tesla engineers had to scramble to fake the thing Elon wanted, because unlike Boston Dynamics or probably hundreds of Chinese startups, Tesla hasn’t been working on robotics for decades.

To put a fine point on it: The richest man in the world is committing investment fraud.

Tesla doesn’t have the product they’re promising, or a viable path to it, or a business model for it that would make sense. It’s all bullshit.

Meanwhile, Elon Musk has somehow become even more openly racist and genocidal in the past few days. I’m sure his main asset reaching the end of its growth narrative has nothing at all to do with his accelerating radicalization.

David Z. Morris

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Mar 11

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Cluely is an app explicitly for cheating, an unparalleled index of the total decline of the tech sector and of society as a whole, whose founders, staffers, as well as the parents of everyone concerned, should be deeply ashamed of every breath they draw.

Now they’re “moving to New York,” whatever that means, and last week they held a big expensive-seeming event, featuring a C-list streamer named Nina Lin.

It turns out Lin may have been one of very few women at the event.

It’s shocking more girls aren’t frothing at the mouth to hang out with guys whose startup is premised on being explicitly unethical and untrustworthy.

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At 11am on Wednesday, I’ll be trying something new at the Dark Markets YouTube Channel: I will be streaming my reaction to Do Kwon’s clemency letter. The letter is, in a word, *hilarious.*

(NOTE: Matthew Russell Lee of Inner City Press has made a lot of key documents very easy to access via Patreon. That includes the defense’s clemency argument. Many of these documents are free if you know how to find them via Courtlistener, but not all of them, so a sub to ICP is a great deal if you’re a fan of watching bad guys locked away like the rabid dogs that they are.)

There’s a fine line between making the strongest credible case for clemency, and insulting a sentencing judge’s intelligence with flimsy, overreaching arguments. I’m undeniably biased – I think Do Kwon is a malevolent sociopath whose elite indoctrination has led him to regard his fellow humans as nothing but either tools or obstacles to his hero’s journey – the same pro-crypto

But I think even objective observers will find plenty of truly laughable excesses in this argument for clemency.

Highlights include:

• Defense lawyers cite Do’s three years in a “brutal” Montenegrin prison as reason his sentence should be reduced. But he was imprisoned there because he went on the lam to try and evade charges in South Korea. Rewarding people for fleeing justice is not generally how the law works.

• “Fraud cases come in all varieties,” the defense write. “Some are akin to outright theft. Some are Ponzi schemes or houses of cards from the outset. This case is fundamentally different.” This is, of course, bullshit. Maybe Luna wasn’t a house of cards “from the outset,” but as soon as Jump started subsidizing APR paid out for UST parked in the Anchor protocol, the system as a whole was barely distinct from a Ponzi scheme. Then there was the active fraud of Chai payments. And the more obscure printing of unbacked stablecoins at the system’s outset.

• “Do does not equivocate about his role in that crash and how his arrogance got the best of him. He made false statements, exaggerating Terraform’s capabilities and misleading investors about the stability of its products. As he puts it, ‘I let my early success and fame go to my head.’” This is at least more self-aware than Sam Bankman-Fried’s brain-dead denials, but a judge will likely see that it’s still wildly self-serving – only a slightly modified version of SBF’s “I fucked up” thesis. The idea that Do got out over his skis out of hubris is simply a misdirect from his substantive and active frauds.

• Do’s overt fraudulent acts are alluded to in the letter as “serious mistakes made while facing pressures he was ill-equipped to handle,” an absolutely infuriating sleight of hand: ‘Yes your honor, my client sought immense wealth and power, but it turns out he couldn’t handle it. No foul, bro.’

• “His mother was convinced he was destined for high achievement and fostered his path.” We’ll see a LOT more of this in Do’s own letter, but it’s staggering to see “his Mom thought he was smart” trotted out as some kind of character endorsement here. What you’re describing (and what Do blithely describes even more clearly in his own letter) is a spoiled, coddled jackoff who never had to stand on his own two feet in his life. No wonder this effete prep-school fancy boy

All in all, I expect Do Kwon to be sentenced to the full 12 years allowed for in his plea deal. After that, he’ll likely be extradited to South Korea, where people will likely still want his head on a fucking spike in a decade.

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