‘Big Short’ Author Michael Lewis On The Financial Crisis, FTX And Bitcoin’s Freedom From Intermediaries
Bestselling author and journalist Michael Lewis, known for writing “The Big Short,” “Moneyball,” and “The Blind Side,” offered his view on the current financial landscape and the rapidly changing world of cryptocurrency on stage today at Bitcoin 2023.
“When I was confronted with the idea of being able to use blockchain technology in non-intermediate financial intermediaries, I thought, ‘Thank God,’” Lewis said of his accomplishments when first researching Bitcoin. “There are a lot of unnecessary hands touching money when financial transactions happen. They were kind of hard to put into order.”
As the author of “The Big Short,” Lewis articulates the fundamental inequalities and shortsighted policies of the contemporary financial system that led to the economic crisis of 2007 and 2008 and the problems that caused that crisis.
“If you go back to the original Satoshi paper, you know, first line, second paragraph, you eliminate the need for a reliable financial intermediary,” Lewis said. “It is clear that the beginning of the entrepreneurial spirit is a mistrust of existing financial institutions, a well-earned mistrust, against the backdrop of the financial crisis.”
Throughout his books and news reports, Lewis has been commended for his ability to summarize complex financial concepts in easily digestible prose and to show systemic issues through the experiences of the individuals within them. This skill set makes him uniquely qualified to digest and interpret the nascent cryptocurrency ecosystem, which suffered unprecedented turmoil last year with the collapse of several crypto projects, most notably FTX.
In Bitcoin 2023, he discusses his next book and film project, which will focus on FTX, and describes some insight he gained from spending time with former CEO Sam Bankman-Fried before and after its crash.
“I didn’t think I’d be writing about Sam Bankman-Fried in a million years,” Lewis recalled, adding that he was first asked to meet Bankman-Friend by a friend on Wall Street, and found himself fascinated by his unique personality. “There’s clearly potential for a great movie in it…so you want to let people know it’s out there.”
Lewis was joined on stage by Arthur Hayes, co-founder of cryptocurrency exchange BitMEX. Hayes asked Lewis if he owned bitcoin, and Lewis quipped that he was “into bankrupt FTX.”
Hayes and Lewis also touched on the current banking crisis, with Lewis sharing the view that things haven’t really changed in the institutional system since 2008 — if anything, things are worse for retail investors.
“He seems inherently unstable at the moment,” he said. “I basically created a handful of too-big-to-fail institutions, and everyone knows their deposits are insured, so no other institution can really compete in that environment… It’s not going to end until there’s some structural reform.”
