It is a paradox of history that the people who bring down empires are often obscure and unimportant figures. In the 1930s, an elite FBIThe Federal Bureau of Investigation, which investigates crimes on a national level in the USA. unit was tasked with bringing down gangster Al CaponeAn Italian-American gangster of the early 20th Century who became famous during the Prohibition era.. But in the end it was two minor bureaucrats, George Johnson and Frank Wilson, who got Capone imprisoned; not for his many murders and thefts, but for tax evasion.

So it was with Sam Bankman-FriedAn American entrepreneur who was the youngest billionaire in the world. He had pledged to give most of his wealth to charity across his life, before being arrested on fraud charges., known by his initials, SBF. It was not the government or another businessman who brought him down, but an amateur sleuthDetective. named James Block, who investigates financial crimes in his spare time.

Early last month, Block published a blog post suggesting that SBF's cryptocurrency trading firm Alameda Research might have run out of money. Within a few weeks, SBF's entire fortune had disappeared. 

And on Monday night, SBF was arrested at his home in the BahamasA country in the Caribbean. at the request of the US government. He was later charged with fraudDeceiving others for gain, often financial. . He is accused of stealing his customers' money.

It has left many wondering what went wrong. Some pin the blame on SBF's philosophy.

SBF was a believer in effective altruism (EA). The idea behind EA is simple: we should all seek to do the most good we can for the whole of mankind, and use evidence and reason to decide how we can achieve this.

In recent years, many Effective Altruists have turned to "longtermism". This is the idea that since there will be trillions of human beings after us, our aim should be to ensure that they can survive and flourish.

And this is why some people blame EA for SBF's fall. They think SBF was so fixated on doing good for the whole of humanity and for future generations that he felt he could do anything he liked in the here and now.

Earlier this year, Alameda lost huge amounts of money and was on the brink of going bankrupt. Some insiders have claimed SBF decided to save it by taking customers' money from his other firm, FTX, and using it to bail out Alameda.¹

From an EA perspective, the reasoning is clear: it would be better to steal from a relatively small group of customers to ensure the money would keep flowing and benefiting the whole of humanity.

This is the problem with EA, say its critics. It thinks hard about what it should do, and how it should do it. But it does not think about who should do it. 

That means it ends up putting a lot of faith in billionaires to invest in the right causes. But people rarely become billionaires by giving money away.

Others think this gives SBF too much credit. This is not a story of a noble philosophy taken too far, or a good person making honest mistakes because he was too focused on making humanity happier.

They argue SBF simply did not think about the wellbeing of his customers or the long-term future of his firm. He ignored important rules because he thought they should not apply to him.

SBF might like being portrayed as a tragic philosopher-king, they say. But in truth he was just a rich kid who destroyed other people's lives in pursuit of personal glory.

Yes: SBF was clearly a strong believer in EA, and it seems likely that it shaped his decision-making. He was so fixated on the whole of humanity and its future that he lost the capacity to think about the here and now.

No: This is a story as old as time: someone who was not suited to run a company making terrible mistakes and costing other people money. SBF's errors are his own.

Or... SBF's mistakes were driven by one particular form of EA: one that has total faith in individual decision-making. It is a sign that EA needs to be implemented in a completely different way.