When SRM Shot Up in Value, Sam Bankman-Fried Changed the Rules for His Workers, Michael Lewis Says

Many FTX employees were acceptable to go fabulously affluent due to the fact that their holdings of Serum’s SRM had changeable up successful worth successful 2021.

But that annoyed Sam Bankman-Fried, who had backed Serum, since that meant those employees mightiness not beryllium truthful consenting to enactment successful 14-hour days astatine his crypto exchange, since they were present insubstantial multi-millionaires.

So, Michael Lewis explains successful his caller book, “Going Infinite,” the FTX CEO changed the rules, locking up those SRM tokens for longer truthful his employees had to hold to merchantability them.

Crypto firms and protocols often compensate employees by giving them immoderate tokens, with the caveat that they are released to the worker connected a acceptable schedule. With highly liquid cryptocurrencies, it’s viewed arsenic important that insiders not beryllium capable to dump them connected retail investors arsenic soon arsenic the tokens commencement getting immoderate traction.

Locked-up tokens springiness disconnected the cognition that the squad is successful for the long-haul. The nonstop docket of these token unlocks is published arsenic portion of a project’s tokenomics.

Bankman-Fried changed the SRM rules

During the 2020-2021 bull market, SRM was a rising star. As CoinDesk reported astatine the time, it experienced important terms surges aft being listed connected Binance, with its occurrence attributed to its affiliation with the decentralized speech Serum connected the Solana blockchain, and its relation with Sam Bankman-Fried of FTX and Alameda Research.

SRM deed an all-time precocious of $13.72 successful September 2021, according to CoinDesk Indicies data, making anyone connected the squad that was allocated tokens astatine its motorboat terms of $1.70 successful August 2020 “ridiculously rich,” arsenic Lewis wrote.

“In the good people of the worker Serum contract, he’d reserved for himself the close to widen Serum’s jailhouse time, and helium utilized it to fastener up each employees’ Serum for 7 years,” Lewis wrote. “They present understood that if helium had changed the rules once, helium mightiness bash it again. They became little enthusiastic astir their Serum.”

In the weeks pursuing FTX’s bankruptcy past November, and its consequent hack, Serum's SRM tokens surged successful value arsenic the decentralized speech assemblage initiated an exigency fork to code information concerns, fixed the token’s uncertain aboriginal fixed its ties to the compromised FTX.

SRM is down 99.72% from its all-time high, according to on-chain data, and is thinly traded connected a half-dozen lesser-known exchanges.