What does it look like when a crypto mogul holds crypto's version of a press conference and he gets confronted with his role in a crypto media scandal? This morning, Sam Bankman-Fried was grilled about Friday's revelation of his secret payments to the Block, a crypto publication founded in 2018. The question came at the tail end of a Twitter Spaces hosted by Unusual Whales, a pseudonymous Twitter account that gained a following tweeting about congressional stock trades during the pandemic and offers a financial information service that is heavy on crypto data. For the record, it turned out to look a lot like many old-fashioned press conferences, just in a new forum: Bankman-Fried dodged the question and left the conversation. But the moment highlights just how much crypto-native media there is, and the speed with which it has become its own online information sphere that is largely distinct from the mainstream media's. Last week, I wrote about the symbiosis between Elon Musk's Twitter and the email newsletter platform Substack, which is feeding the emergence of a more developed anti-establishment digital media ecosystem . Well, crypto media is its own full-fledged thing, too. Much of it looks like traditional outlets that happen to cover a niche topic, with newsrooms, articles and podcasts. But it is also deeply intertwined with Twitter, the chat platform Discord, and the encrypted messaging app Telegram, as well as tools for direct analysis of blockchain data. And it has a lot of overlap of its own with the rest of the anti-establishment digital media sphere — as the FTX collapse illustrates better than perhaps anything else. In fact, Crypto entrepreneur Mario Nawfal, who hosted Musk for a Twitter Spaces to discuss the "Twitter Files," also hosted a Spaces with Bankman-Fried as part of the mogul's ongoing apology tour. To really understand the crypto media sphere, it's worth going back to the earliest stages of the FTX collapse — one of the biggest stories in the world right now — and reviewing just how much of it played out in this largely self-contained ecosystem. Bankman-Fried's troubles began in earnest with a Nov. 2 report by CoinDesk, a decade-old crypto news service owned by Digital Currency Group, a crypto-focused VC firm. CoinDesk obtained financial records showing that FTX was more financially intertwined with its sister firm, the hedge fund Alameda Research, than previously known. The report set off online chatter speculating that Bankman-Fried's empire was not financially sound and that the price of FTX's native token, FTT, was inflated. Four days later , the CEO of rival exchange Binance, Changpeng Zhao, announced on Twitter that his company was selling off its holdings of FTT. Bankman-Fried and Alamada's CEO, Caroline Ellison, fought back, also on Twitter, to assure the crypto world that their finances were sturdy. On-chain analysis — the interpretation of public blockchain data — provided a hint that the two were not as confident in FTX's financial position as they appeared. The Data Nerd, a pseudonymous Twitter account dedicated to on-chain analysis, reported that Alameda had sent more than $250 million worth of stablecoins to FTX in a day, in what looked like a bid to prop up the embattled exchange. As the collapse began, much of the most prescient real-time analysis of FTX's precarious financial position came in Tweet threads and Twitter Spaces from from 21-year-old financial analyst Dylan LeClair, a contributor to Bitcoin Magazine. As the fallout from the collapse unfolds, one source of extensive leads and tips about it is Autism Capital — a Twitter account created in 2020 and tied to a Discord chat — that has obsessively chronicled it. Sometimes it reports details of the fallout ahead of mainstream outlets. On Dec. 4, the account tweeted that Ellison was being represented by the law firm WilmerHale. Bloomberg has since reported the same. Of course, mainstream outlets have been all over the FTX story, too. POLITICO has covered the ins and outs of the response from Washington; the FT and Wall Street Journal have landed scoops about internal malfeasance; a Vox reporter published a damning chat with Bankman-Fried; and the New York Times landed a much-watched live interview with Bankman-Fried. The tenor of coverage, though, often diverges. In mainstream outlets, the FTX story is largely about the dangers of crypto, with its lack of regulation and ever-present scams. In the crypto media world, more emphasis is placed on the extent to which Bankman-Fried funded establishment media outlets and politicians while becoming the crypto mogul most embraced by those establishments. (For Bitcoiners, the lesson is that both non-Bitcoin crypto and the political-media establishment are hopelessly corrupt) What's the bigger picture? Media ecosystems tend to take hold around important venues of human interaction, like governments and markets. The core activities of governments emit basic units of information (e.g. bills and executive orders). Same with markets (prices and trading volumes). Around these core pieces of information, more elaborate media ecosystems can sprout up to cover everything else that's going on. As I discussed with information warfare analyst John Robb last week , digitally connected networks are a new kind of human coordination mechanism. These digital networks produce basic chunks of information, too, like social media posts. And blockchain networks — a new subset of digital networks — are leaving behind on-chain data. Could they one day sustain media ecosystems that are just as robust? It's impressive how big and developed crypto's media ecosystem has become. But it might be too big. After all, as Byron Guilliam, senior markets strategist at Blockworks, a crypto media firm geared towards financial institutions, pointed out to DFD, "The entire crypto market cap is smaller than Apple, and Apple doesn't have 15 media outlets covering it." The FTX collapse might be pointing the way to the future of digital information. Or — as the crypto markets remain in the doldrums and the Block is now rocked by scandal — it could be the last hurrah for a crypto media bubble that is primed to burst.
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