Bankless - ROLLUP: $120 Oil vs New Highs | AI Boom Masks War | IPO Top Signal | DeFi Bailout

Starting point is 00:00:03 Bankless Nation, it is the last week of April, 2026. Time for the bankless weekly roll-up. We got oil prices at their highest level yet, at least since the start of this war. There are signs of an indefinite blockage on the Strait of Hormuz. Rock in a hard place. Yeah, rock in a hard place. We're going to talk about that and where oil price is going. Despite all of the turmoil in the Middle East, which does not show any signs of wrapping up, markets are going up.

Starting point is 00:00:31 S&P at the time of recording is at all-time high. It just printed its best month since 2020. We are on the last day of the month at the day of recording. So we have the turmoil in the Middle East on one side. We have the AI boom on the other side. One of these things, at least in the equities market, is clearly winning. And then also that is leading into the three biggest IPOs in history

Starting point is 00:00:54 all come in into the market in the next six months. Could that mark the top? I think it's at the top. Is that the top? I think it could. We're going to talk. about whether that's the top or not. Also, Powell is now out. This was his last FOMC meeting. He had some dissent on the committee as the most divided FOMC votes since 1992. We'll talk about that.

Starting point is 00:01:15 And as he was walking out, he said, I won't see you next time. And then he announced he's actually not leaving. But this means he doesn't do the meetings anymore. That's right. That's what I think I think he ends the meetings with see you next time. Yeah. And that's why he said, I won't see you next time. that's why it was funny. Anyways, in the crypto news, Defi had it's a bailout moment, $303 million raised in just 11 days to fill the hole left by the Kelpdow layer zero. Biggest hack in history rescued by Defi itself. Kind of cool, a heartwarming story. I do not expect it to be the status quo moving forward.

Starting point is 00:01:51 This was a one-off, probably, but we'll just talk about that. Bitcoin Vegas highlights the Bitcoin Conference hosted by Bitcoin Media, has happening right now. Eric Trump says the U.S. holds. 300,000 Bitcoin and won't sell it. The acting attorney general tells crypto devs that code is not a crime, but do they really mean it? And then a soldier was arrested for winning $400,000 on a polymarket bet that he did with classified intel. And so we're going to talk about all the implications of that. Turns out that's illegal. I think that's illegal. Do you think he knew that ahead of time? We're probably going to have to find out that. I'm pretty sure he knew it was a bad idea.

Starting point is 00:02:25 You know, I want to start this week with this clip because not often do you hear the Secretary of War for the world's greatest military power talking about Bitcoin. And yet, that's what we just heard in Congress. So this is a question from a member of Congress to Secretary of War Pete Hegzeth. Let's play the clip. Over the past decade, Bitcoin has evolved from a fringe asset into a matter of national security. Iran has demanded Bitcoin as a toll for transit through the Strait of Hormuz. North Korean cyber actors have leveraged it in ransomware campaigns. And China is believed to be stockpiling substantial holdings as part of a strategic reserve. Just last week, Endo Paycom,

Starting point is 00:03:07 Commander Admiral Paparo, stated that Bitcoin has direct implications for power projection, and he noted that Endo Paycom is operating a node on the Bitcoin network and furtherance of that mission. Secretary, do you share the opinion that Bitcoin is a tool to project power, and are there any department-wide initiatives to ensure the U.S. secures a strategic advantage in Bitcoin and combats China's digital authoritarianism? I guess my short answer would be yes and yes, long and enthusiast of Bitcoin and crypto potential. And a lot of the things we're doing, enabling it or defeating it, are classified efforts that are ongoing inside our department, which I do provide us a lot of leverage in a lot of different scenarios. I appreciate that.

Starting point is 00:03:49 And I share your views. Okay. That was interesting to me. So first of all, China stockpiling. That's what the member of Congress said. I don't know how true that is, but China stockpiling Bitcoin. And then the question to Pete Hegeseth, like, is Bitcoin a matter of national security and importance? And he said, yes, it was.

Starting point is 00:04:09 And then he also said, I'm not going to divulge the ways we are both supporting Bitcoin and also thwarting it in cases? Thwarting it? What does that mean? Yeah. Do you think there's substance there? Because Donald Trump wants and all of his cabinet wants the United States to be pro-crypto capital of the world. And so you could just like see this as kind of pandering. It's like, yeah, Bitcoin is a tool of our power because it aligns with our interests.

Starting point is 00:04:34 Sure. Or there's actual substance there. Yeah. I think it might be both, David. I think it might be both. Actually, that question from the representative almost felt a little kind of like seated, as all of them do, right? Like, I want you to say something nice about Bitcoin. So I'm going to phrase this question a way that allows me to be.

Starting point is 00:04:50 Let me underhand this one to you, Pete, and you can knock it out of the park. I felt like that. But also at the same time, we have the, um, uh, the, war in Iran and is it economic fury? Is that what you were calling it last time? So crackdown, Iran using tether, you know, the U.S. Treasury freezing that, Iran talking about using Bitcoin. I'm not sure if they have. You wonder if the Secretary of War and the U.S. Defense Department has some sort of design in a way to prevent them from using Bitcoin in the future. That would be fascinating. We are interviewing an individual from TRM Labs tomorrow, who I think is going to be able to

Starting point is 00:05:26 kind of inform us exactly the depth of involvement that Iran has with Bitcoin and also what the US is doing about it. So stay tuned for that if that is something that is in your feed. Speaking of the war, let's just get into the update on the Iran War. Maybe three big things to kind of highlight a kinetic war, potentially back on the menu. Donald Trump has briefed the military to prepare for a long blockade of the straight overhaul moves as opposed to a short one. Like we're in it for the long haul here. Like it's like indefinite. There's no date in which it's finished. Yeah.

Starting point is 00:05:58 And then Trump says that he will keep Iran under a naval blockade until they agree to a nuclear deal. So downstream of all of this, Brent Crude just poked above $120 a barrel, all time highs for the war. So we are at wartime highs. I think last week and the week before I said we were like wartime lows of $90. We're at $115 to $120 a barrel at the time of recording, which is as high as it's been during for the whole entire war. This is showing up across the world.

Starting point is 00:06:30 Asia is in one of its worst energy crisis. He's in history and the inflation in Asia is pretty high. United States, gas prices have climbed to the highest level since August 2024. Nationally, the average is about $4.23 a gallon. And I mean, we did our episode with Roy Johnson this last Monday. Fantastic episode. I really, really liked it. He thinks this is the beginning of something much, much, much more.

Starting point is 00:06:59 Yeah, Rory is now our designated oil quant as well. And he tweeted this. I saw this morning from him, a cover from the economists saying, still in la la land with respect to oil prices. Why oil prices are not yet high enough. And he basically says, yeah, the economist cover is correct on this. I think he believes oil prices are going north of 150. and he just is doing the math based on the amount of supply that's actually locked in the Strait of Hormuz. I think he said like 13 million barrels per day being knocked offline of a total of 100 million

Starting point is 00:07:33 barrels per day. That's like, you know, 10 to 15 percent of the world's oil supply. And the market, according to him, has not yet absorbed those prices. And as he said, it doesn't look like oil or the Strait is going to be opened anytime soon. Actually, Roy thinks this will all conclude at some point when Trump starts to feel the pressure on his numbers, whether that's oil price, whether it's price at the pump, whether that's stocks, it doesn't look like it's stocks this week, whether that's his approval ratings or treasury. He thinks the financial markets will actually push him into stopping, but it doesn't seem like we're close to that yet. Yeah, the interesting thing that came out of that episode with Roy was his, like, articulation that any time oil prices

Starting point is 00:08:16 got too high or stock prices got too low or yields got too high, Trump was like, Yeah, it's all over. We're done here. And then the market would, like, get suppressed. And so the implication is, like, Trump was doing active market manipulation, in a sense, of just like, oh, I don't like how high. Expectation management, David. Yeah, expectation management.

Starting point is 00:08:34 It's like, oil prices are too high. It's all over. The war's over. We won. And, you know, here we are. Actually, if you look in hindsight, like, nothing's really changed. And the implication there is that, you know, eventually the market's going to run out of leash and oil is going to do something drastic because.

Starting point is 00:08:50 There's some hard physics here. Yes, exactly, because oil is simply just not flowing out of the Strait of Hormuz. So ahead of all of that, Iran did submit a proposal to open the Strait of Hormuz and end the war. It had this very important detail that the nuclear weapons disarmament line item would be discussed later. So, like, we'll open the Strait of Hormuz, we'll agree to a lot of your terms, and we'll punt on the nuclear disarmament thing. And Trump was like, no, you guys, you guys are. That's the whole thing. That's the whole thing. Like, you guys aren't getting out of that one. And so this is kind of why tension has increased. So Trump has really opted to just continue to squeeze Iran's economy and oil exports through the prolonged blockade strategy, saying that the blockade will continue to pressure Iran into capitulation on the nuclear issue. That's a quote. And then Iran said two days ago that it will never discuss nuclear weapons under current conditions. And so here we are. in Iraq in a hard place and why oil is breaching $120 a barrel.

Starting point is 00:09:56 So there's a couple big takeaways that I just want to underpin. We're kind of back to who can bear the most pain. And there are some points for Iran. There are some points for United States. Reasons why the United States can bear pain is, A, we have our own domestic source of oil. That's West Texas intermediate crude. That's our, like prices are up, but at least we're buffered.

Starting point is 00:10:19 so that's nice for us. It's not as bad as the rest of the world. Not as bad as the rest of the world. SPY, all-time highs. How can you complain? The Dow is above $50,000. We're good here. How can you complain if you own assets in SPY?

Starting point is 00:10:32 If you don't, you can complain quite a bit. Reasons why the United States cannot bear pain. Domestic gas prices are still high. People don't like that. As Ryan just said, many people don't own assets, so the SPY at all-time highs doesn't really matter. Also, 10-year yields have gone up as well in tandem with oil.

Starting point is 00:10:51 And so the cost of debt is now higher as a result of this. That's downstream from inflation, which is downstream from oil prices. Everything is downstream of the Strait of Hormuz. And there also are just a bunch of like other like numbers to talk about. Food inflation is already increasing. And so we're actually starting to see food prices go up because of higher oil prices. Fertilizer prices are up because of higher oil prices. fertilizer is an input into food costs.

Starting point is 00:11:20 Impacts on commodity prices since the start of the war are just bad. Like prices are all higher. Like you can just see everything across the board. Jet fuel, sulfur, heating oil, diesel, gasoline, all up double-digit percentage. So life, the cost of living is just up double-digit percentage. And then like I just said, the 30-year yield is now just 11 bits from a new 18-year high. So a decent number of reasons why this is painful for the United States. That's right.

Starting point is 00:11:45 And as those numbers tick up, the frog will start to be boiled and people will start to notice. I guess in the frog analogy, the frog never notices. But I think people will, in this case, it'll add pressure to the U.S. and Trump. How about the pain for Iran? Yeah. So reasons why Iran can bear pain on, and really this is about the nuclear program. The nuclear program is something close to fundamental to the regime. Like if they capitulate on the nuclear program, it's kind of become elevated to

Starting point is 00:12:15 the whole thing for the Islamic regime. It's a question of their existence. They have always... It's a question. I think it seems like a question of their sovereignty. If they don't have a nuclear program, they'll always be under the thumb of the U.S. and Israel. If they do, then they'll be positioned like North Korea where, like, they're untouchable, right? So it's a sovereignty type question for the regime. Yes, that's the external facing articulation. The more internal facing one is it's a question of legitimacy. They have been in pursuit and spent billions and billions of dollars pursuing this whole thing. And so without it as like an overarching goal internally, it's like what the hell are we even doing here. Oh, really? Yes. Yes. It's an internal legitimacy.

Starting point is 00:12:59 It's so cost fallacy, guys. Yes. But totalitarian regimes. Reasons why Iran cannot bear pain. Their currency is undergoing hyperinflation. The economy is just completely devastated. threatening the ability to pay IRGC paychecks. So this is also internal stabilization. Iran is not necessarily stable internally. Obviously, the people don't want Iran in power without paying the paychecks of the people keeping everything together. How can you sustain yourself? And then also economic fury, which we'll talk about in a second, is also just reducing Iran's means. We're seizing hundreds of millions of dollars of Iranian assets with every opportunity that we have. Last week, we talked about some of those hundreds of millions of dollars. In the case, it was tether freezing, 344 million in USDT. We didn't know at the time what they were freezing. It was the largest in history. I did. You had a guess. David said it was Iran. It turns out it was Iran, David. So Iran was keeping their tether, their staple coin on Tron. USDT, tether on Tron yesterday. And that was all frozen by tether. It's so funny. We'll be making that mistake again.

Starting point is 00:14:10 Like, Tron, Tether, U.S.C.T. I mean, you can get screwed so many different times. You get frozen by Tether. You also get frozen by Justin's son. It seems like a very strange place to put your value if you are a rogue regime. And nevertheless, they put it there and it was all frozen. So this is Secretary of Treasury, Scott Bessent, saying the Treasury Department, through Economic Fury, has targeted Iran's international shadow banking infrastructure, access to crypto, he's said. says, Shadowfleet, weapons procurement networks, and he goes on and talks about all the other things that they are restricting access to. It's kind of a question, David. So let's say Iran does learn from this mistake, and they're like, okay, no more stable coins. The U.S. can, you know, obviously freeze that. What if they keep their value in something else? What if they start keeping their value in Bitcoin, Ether, something on Ethereum maybe, not in stable coins, but some of these

Starting point is 00:15:05 crypto-native assets, then what does the U.S. do in those cases? We haven't seen evidence that the U.S. can do anything, but there was also that ominous comment from Pete Hegesith at the start of this episode. Maybe the U.S. has some way to interfere or, I don't know, get at the Bitcoin that a rogue regime holds. What do you think? That would be wild if they have means outside of what people expect them to have when it comes to censoring Bitcoin. I guess what I'm saying is that's about to be tested, right? I mean, we've always talked about these crypto assets being how sovereign to nation state attack are they?

Starting point is 00:15:43 Well, this is a case where a nation state, the most powerful nation state in the world, actually wants to probably attack some of the assets, the crypto assets that of rogue regime has. And so they're going to do whatever they can. And will Bitcoin stand up to that or not? with this freezing of tether on Tron, you could assume, it's safe to assume, that the Iranian regime, the Islamic regime will like reprioritize Bitcoin as a result. It's like, well, they just got their dollars stolen on Tron. Maybe Bitcoin on Bitcoin is a better option. And then I think what you're

Starting point is 00:16:17 saying is like, okay, with that being the case, Economic Fury, the OFAC Treasury Department is going to do everything possible that they can do to seize the Bitcoin or, censor the Bitcoin in some particular way. I'm just saying, like, Tether, who they're, you know, partnering with Economic Fury. They also own the largest Bitcoin miner in the world. Yeah. I mean, I'm sure they're probing for some nexus to attack some of those assets to if they can. And we'll see how that turns out. Yeah. Let's get into stocks. The SMP is on track for its best month since November 2020. Now, there's a little, I would like to add in a nuance is that the April 1st, March 301st, was the absolute bottom of the Iran War, and so it's a perfect bottom

Starting point is 00:17:05 to start measuring this number. But nonetheless, the S&P 500 is up 13.5% over the 30 days of April. Pretty crazy. How is it possible with all of the turmoil, with all of the oil prices, Ryan? I think the answer is AI, dude. It's AI boom. We're talking about AI bubble. And lots of people have been repeating that.

Starting point is 00:17:31 We have an AI boom on our hands. Maybe it's a bubble. It's certainly a boom. This is how Kobiasi letter puts it. The answer to that question, the question you just asked, of if oil prices are above 100 per barrel and the war isn't over, why are stocks at record high? The answer is simple. The AI revolution has simply become so large that investors are viewing everything else as noise. It's so big.

Starting point is 00:17:55 It just drowns out everything else. Like AI is increasing the productivity of companies. The war is temporary. AI is forever. We're seeing this in top line. We're seeing this in bottom line. We saw some stellar earnings reports come out just yesterday. Google in particular, incredible top line numbers, incredible profit numbers, exceeded analysts' expectations up 7 to 8 percent, right?

Starting point is 00:18:16 No one of the S&P is still humming. It's because AI is crushing it. Actually, let's do a David charting corner. Can we see some of these charts? Love all-time highs. Want to see the David Hoffman charts. got for us. David Hoffman, the trader. That's right. No, you just look. You don't trade, right? Starting off with the SPY, we're just poking ahead of the all-time highs with 7,000, almost 7,200, just shy of it.

Starting point is 00:18:41 And it just incredible, just like, you're at a loss for words. Yeah, we had these strikes. It was went straight up all of April. Kind of wild, dude. NVIDIA, it poked ahead of all-time highs. It's a little bit back down to $200. I should. share, but the previous all-time high back in November was $216. Yeah. It hit 216 a couple days ago. That's wild. Amazon is basically at all-time highs.

Starting point is 00:19:07 It hit $275 after earnings report yesterday. Came back down, but still, yeah, at basically at highs. Google's the big one here. Oh, my God, dude. Look at that, man. That is wild. Up 10% after they reported earnings to $384 a share. Just Google is on an absolute tear.

Starting point is 00:19:25 And I think those are all the big ones. No, no, there's some big ones you forgot. How about Bitcoin? How about Ether? How are they doing? Not big. Not flat on the week. Bitcoin, I think, is up 2.5% on the week.

Starting point is 00:19:38 Eth is up 1.5% on the week. So Bitcoin is at 76,000 ether, that 2,250. Overall, unremarkable price action in crypto. I want to throw a theory by you, or at least a possibility here. So, you know, talking about the AI boom, of course, The king of the AI boom right now is Anthropic. Anthropic just passed open AI in revenue for the first time. So this is $30 billion from 1 to $30 billion in 15 months.

Starting point is 00:20:07 Open AI is $24 billion. Look at this chart. Anthropic just gaining ground. This is the fastest valuation like tripling in tech history. And so this is going to IPO at some point. And we have some pretty major IPOs coming down the pike. The biggest IPO run in history, in the history of the market. SpaceX IPO, that's going to be at least $1.7 trillion, the OpenAI IPO, imagine that exceeds

Starting point is 00:20:32 a trillion. Anthropic is already worth over a trillion dollars. So that's three over a trillion dollar IPOs. This tweet says, we're living through the greatest technological wealth creation in history, Anthropic from $380 billion valuation to $1 trillion in just three months. Okay, so all of that IPOing, right, this is initial public offering. This means you are taking shares that were private, that were owned by insiders, that were owned by VCs and investors and management team, and you're releasing them to the public at massive elevated valuations that the public has not partaken in. What does this remind you of, David?

Starting point is 00:21:14 This is, yeah. The top? It could be. I mean, we've seen similar things play out in tokens, right? Our tops in tokens, like our tops in crypto always end when there's too many assets to go around and not enough investors, right? Yeah, yeah. And asset, in crypto asset creation, like token creation, goes up when prices go up. Yes.

Starting point is 00:21:38 And so there's a correlation there. Being a $1 trillion company, do you know where that puts you in the ranking of companies, right? Oh, it's got to be top 10, right? If you're over a trillion now, top 10. Gold is number one, silver is four, and Bitcoin is 12. And so if you cut those out, you're in the top 13. You're in the top 13. Yes.

Starting point is 00:22:02 And these are brand new companies and have never been publicly traded. This is Tom O'Shaughnessy's take. I was talking to someone today, but what they think happens when all these companies, IPO, and if that's the top for the AI craze, history says mega IPOs at peak narrative usually mark the top for that theme. but rarely for the index and this is three of the biggest ever to land in the next six months. So another take related to this.

Starting point is 00:22:26 I've been thinking about this for a while. These IPOs will drain so much capital from the system especially after the unlocks. Remember, you get investors, management team unlocks. These are going to be like multi-millionaires, a lot of liquidity sloshing around. They're going to want to exit at least some portion of that

Starting point is 00:22:43 for harder assets. Some people have billions of dollars locked up in these shares. will become unlocked. Like, they're hammering the sell button. They're hammering the sell button. That's right. And more and more, IPOs have been a process of, like, it's like an exit liquidity process.

Starting point is 00:22:59 It's not like retail public markets have participated in these gains. They're just starting to get in at the top when the company is worth multiple trillions of dollars. So that could be the top. That could be the top, David. Did you see the Elon's share package agreement in SpaceX? No, is it insane? He, it's there, I don't know what the more short-term stuff is, but there's like a massive amount of SpaceX shares that get awarded to Elon if he puts a one million dollar, excuse me, a one million person colony on Mars.

Starting point is 00:23:34 That is a real thing. That's a real KPI miles. Yes. That's incredible. Yeah. I mean, I don't know if that guy sells. I haven't looked at his selling track record, but he doesn't sell. He doesn't sell.

Starting point is 00:23:45 He doesn't sell. He doesn't sell. Meanwhile, David. The Fed is injecting more liquidity into the system. So we talked about this on the defy report with Michael Nado. He's talking about the Fed's RPM program. Since December, the Fed has actually injected $172 billion to their balance sheet over the last four months. There's some question as to like, is that going to continue under Kevin Warsh?

Starting point is 00:24:08 I think Michael and some others were hoping that Powell would say something about it in the FOMC meeting. He really didn't. So I guess what I'm saying is the liquidity picture, I know. Michael Howell says liquidity is turning over. It's on the side of going down. And yet, the liquidity picture is actually increasing a little bit, at least on the Fed side and the U.S. side. So it's on kind of the brink of some teeter-totter balance where we could actually get more liquidity or people like Michael Howell are right than liquidity could be going down. So don't, that is a story that is yet to be told. You're right. You're right. Well, great summary of it. David,

Starting point is 00:24:43 we should pause right now and talk to the sponsors that made this possible. And after that, We're going to get to Powell, some Bitcoin clips, Mega-Eath, also, Defi United, the bailout so much more to cover. But before we do, let's thank the sponsors that made this possible. Quick shout out to OKX. They are live in the States, building the new money app. And Wall Street is taking notice. The parent company of the NYSEE just invested at a 25 billion valuation and took a board seat. That's the New York Stock Exchange coming to crypto, not the other way around. And why, OKX? It's the only app combining a full centralized exchange and self-custody wallet in one place. Sex trading, decks access, on-chain activity, all in a single interface.

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Starting point is 00:27:14 at Coinbase.com slash bankless. That's coinbase.com slash bankless. Visit Coinbase.com slash bankless to get 20% off of the first year of your annual plan today. Offers are valid until May 31st. Terms apply, Coinbase 1 card is offered through Coinbase Inc and Cardless Inc. Card issued by First Electronic Bank. Bitcoin back rates are based on cardholder assets on Coinbase. David, this is a picture of Fed Chair Jerome Powell exiting from his last FOMC meeting.

Starting point is 00:27:37 kind of anti-clamactic. He says, Thank you very much, everyone. I won't see you next time. This is followed by much laughter. Actually, did you see this clip? This was kind of funny. I'm going to play this.

Starting point is 00:27:49 This kind of humanizes, pal. Howard Schneider with Reuters. You mentioned that staying on as a governor, you intend to keep a low profile. I'm just wondering if you could give us a little more detail on what that looks like and how you can. Chay. All right.

Starting point is 00:28:05 People are laughing because, pal, When he says low profile, Powell starts, like, ducking lower and lower on the podium so you can't see him. And it's not, there's no lag there. He instantly just starts literally getting a low profile. Economist humor is great. I think part of the backdrop of that is that Trump arrested James Comey earlier this week. Oh, yeah. And so Powell's like, I'm literally going to have a low profile.

Starting point is 00:28:34 I want to shrink behind this podium. Yeah, exactly. Now once you disappear. Well, he's not going yet. We'll talk about that in a minute. But first, the Fed Funds rate, what was the number? They held 3.5 to 3.75. No change.

Starting point is 00:28:47 But the dissent was the story here because there was more dissent than we've seen since 1992. Yeah, yeah, four dissenting votes. It was an 8-4 vote. Who dissented Stephen Mirren, who always dissents because he wants to always cut rates because he's Trump's little little puppet. He just likes cutting rates, okay? I don't know about that. He just loves cutting rates.

Starting point is 00:29:12 He loves cutting rates. The other three dissented in the opposite direction. They dissented because part of the comms from the Fed was to signal a possible easing bias in the future. And they dissented because they didn't want to signal that. Yes. And so they said, no, in the future, there is not necessarily easing happening. and, you know, reading between the leaves, we have Warsh, Kevin Warsh,

Starting point is 00:29:38 incoming to the Fed as the new Fed chair. He's going to be the guy doing the new Fed meetings. Yep. And this is a shot across the bow to Warsh saying, hey, dude, you're coming in here as Trump's new puppet in addition to Stephen Mirren. We're not doing the whole politicization of the Fed thing.

Starting point is 00:29:58 Well, they're pushing back. They're pushing back because Kevin Warsh has indicated that he actually sees deflation as a primary problem that comes with AI. Because of AI, yeah. Maybe some openness to cutting rates, and this is maybe the FOMC saying, hey, like, we're pushing back on that. This was a key term that they changed. Maybe the most important takeaway from the Fed decision.

Starting point is 00:30:19 So for months, the Fed has been talking about inflation in the use this term, somewhat elevated. Okay, that's their policy statement. Today, they changed that from somewhat elevated to just elevated. So they cut the somewhat. And that means a lot. They think inflation is elevated. Look at this chart here. This is CPI for the last, let's see, five years.

Starting point is 00:30:42 By the way, this is hilarious. You see this gap here? It's like the line break gaps. I think this is when the government shut down, maybe. Is that what that is? There's no other gap here. The government just like stopped reporting numbers on CPI or something. Someone can fact check me.

Starting point is 00:30:57 I think that's what that might be. But look at this. So we are at CPI, 3.2%. Oh my God. Yeah, that is... Kind of spike. Because it was holding below three for a very long time, right? Yeah, and below three...

Starting point is 00:31:11 Personally, I have not been worried about inflation for a long time because it's like it was always below three. Well, how about now? I mean, we haven't been worried about it because history, 2022. Remember, it was 9% recording roll-ups then. And that bad felt pretty hot, not so transitory. Yeah, but Bitcoin was as all-time highs and so it was ether then. So it actually felt okay. It was fine then.

Starting point is 00:31:32 It's less fine now. Anyway, it's ticking up. Yeah. Okay. And so the Fed is saying that, they're reacting to that. Is that the oil, the high oil price print? Is that what this is? I think so. Look, it's starting in February. Like, if oil continues to increase, that's a energy ingredient in all of these things. We just talked about food prices. It's definitely going to affect this. Powell, though, says he actually has faith in Kevin Warsh. He says that he will take Warsh at his word,

Starting point is 00:31:58 that he will stand up to political pressure from Trump. I don't know if he's just hopeful of that or if he's sending some sort of... Trying to manifest it. I feel like he's manifesting. Yes. Now, Powell is actually, that was his last FMC meeting,

Starting point is 00:32:12 but he's staying around as a governor. Okay, so no longer the chair, but he's going to stay around as a governor. Do you remember Trump was, was this like a lawsuit? Is this what it was? Trump was prosecuting Powell for the Fed building.

Starting point is 00:32:28 He used buildings. And there's some impropriety involved there and Powell is going to stay around until all of that is resolved and of course Trump had a response to this. This is a strategic move to deny Trump a majority of puppets. That's right. That's right. And he just wants to wrap this up and you know like a wrap up I guess maybe the prosecution. And Trump's response was this. Fed chair Powell wants to stay at the Fed because he can't get a job anywhere else. Nobody wants him. It's never changing.

Starting point is 00:33:02 At least he's funny. At least he's funny. So historically, I wonder how history will view Powell. I mean, I, you know, maybe I'm going to miss him. Maybe I'm going to miss him when he's gone. He was the 16th Fed chair. He had an eight-year term. So he's been with us the entirety of the bankless show.

Starting point is 00:33:19 Okay, so we've never had another Fed chair. You had the COVID response, kept things together. Dude, do you remember from 2022 onwards? Yeah. It was like, can the Fed walk the tight row? and not getting into it. We talked about the R word for a year. Recession.

Starting point is 00:33:36 Everyone did. Yeah. And he got the soft landing. Now, inflation was not as transitory as he said, but it did go down, right? And he was also. After hiking rates, yeah, it was transitory because they hiked rates. Remember he was going to do the Volker thing and he hiked Rakes, rates, 525 bips, David. Yeah, right.

Starting point is 00:33:56 That's a lot of bips to hike. It's a pretty bold move there. So, I don't know. I give him, you know, I'm a C plus B minus for the Fed chair. I think you did an okay job. Why not A, why not an A or an A minus? I can't think of a Fed chair that gets an A, not in my books. Dude, Ryan is a harsh grader, man.

Starting point is 00:34:15 Do you grade your kids this way? I mean, the balance sheet is all messed up. Like, they're still printing money. Is that the Fed's fault? No, I mean, they're caught in the cycle, but that just impacts my grading. That impacts my grading. I'm a hard grader. I think it gets a B plus.

Starting point is 00:34:28 I think it gets a B plus. Well, David, you can be more generous. I'm sure Powell is very concerned about how the bankless guys are great again. He listens to the show. Checking in, there was a Bitcoin conference in Vegas this week. There was a clip from Eric Trump. This is a three-minute bull clip. I know Bitcoin is low on the week.

Starting point is 00:34:47 I could play that clip for you. Eric Trump, just talking about Bitcoin, how great it is. He said the U.S. government holds 300,000 Bitcoin and will not sell it. The suppression of Bitcoin is unbelievable. I watched this full clip, and it's just like a full-on rant about how fantastic Bitcoin is doing and how underpriced it is. Would you like to... From Eric Trump?

Starting point is 00:35:08 Yes. Would you like to see that? Can I counter you with a shorter clip from Paul Tudor Jones on a podcast with a very good microphone? I will always say yes to Paul Tudor Jones over there. Sorry, Eric Trump. We're replacing you with Paul Trudeau. What's Paul got to say? This is Paul Tudor Jones on Invest Like the Best with Patrick O'Shaun.

Starting point is 00:35:29 talking about how Bitcoin is unequivocally the best inflation hedge that there is. Let's go and just listen to the clip. And then in 2020, when you saw, again, all the interventions, both the central bank and the treasury, you just knew that the inflation trades were going to take off. And what was, of all of them, what was the best one at that point in time, it was Bitcoin. Bitcoin is unequivocally the best. inflation hedge that there is more than gold because Bitcoin is finite. There's only so much Bitcoin that can be mine. I think that begs the question, Ryan. We just talked about inflation

Starting point is 00:36:12 ticking up. Yeah. When's Paul going to put the trade on? Where is he going to come back? Yeah. I watch this whole interview is fantastic. I love Paul, Twitter Jones. And so he was talking about one of his best trades, which was he bought Bitcoin in 2020 because he saw inflation on the And of course, we just looked at the inflation numbers. We went to 9%. Bitcoin massively overperformed just about any asset during that time period. And so, yeah, it's a good question. Like if inflation is back on the menu and Paul, if you're right about it being a fantastic

Starting point is 00:36:44 inflation head, this is also hedge. This is also what Jordy this year said to us, actually. It's like Bitcoin always outperforms when you have real, you know, what do you say? It was inflation and real rates, you know, start to kind of tick down, right? So maybe we're set up for that. David, let's talk about the Mega-Eath token launch. That just hit Maynett today at the time of recording. Today, the time of recording.

Starting point is 00:37:09 I haven't looked at the numbers. What's going on? Well, numbers are just coming in. I'll tell you about them in a second. As a philosophical statement, I think like Mega-Eath and also Monad, everything about this also applies to Monad. Mega-Eath is like kind of the last bashing of the on-chain crypto-native, you know, try new apps, get rewarded for trying new apps.

Starting point is 00:37:31 And so it's like created a little bit of a revitalization of all the people who like to log into apps and press buttons with their crypto wallets. So I think it's like something to celebrate. And I think the mood is like kind of coming up is boosted a little bit of this. Mega Eats, they put their token launch behind KPIs. One of those KPIs was hit, the 10 live ecosystem apps with real users, which created the seven-day countdown, which we were at the end of. And so checking in on just a valuation of the mega token, the ticker is mega, great, great ticker, 15 cents, which puts MegaEath at a $1.5 billion valuation in a $1.70 million market cap.

Starting point is 00:38:11 That's not bad. Not too high, not too low. Yeah, it seems non-frothy. Seems very healthy. And right now a lot of the, if you were in the ICO, you had some of your ICO unlocked. If you participated in the NFT sale, forever go, you have your tokens. And so there is a big gap between float and total supply, but it's always how it is. And the thing to do, they have this incentivization campaign.

Starting point is 00:38:35 And so they have this dashboard. It's a map of Amsterdam. Obviously, everyone loves Amsterdam and crypto because this is where we started trading things, everything between actual real stuff and also tulips. And you can just go into the mega-Eathai portal and they have all the apps so you can go try them out. There's some cool stuff there, right? Yeah. There's Dexes and Perps and DPN.

Starting point is 00:38:58 Some ecosystem has been built. The whole game. Euphoria is kind of a cool app. Tap to trade. So what did, so the token was released. Did people sell? Did, like, what happened there? I saw one tweet from an analytics company that said 8,300 wallets that received their

Starting point is 00:39:17 mega tokens. And they all purchased mega, right? Everyone purchased mega. There's no error drop. That's right. This is one of the unique things about the mega story is that everyone who owns megatokens has a purchase price. So they believed in some sort of value accrual increase thing for the token. They were true believers.

Starting point is 00:39:34 Yeah. I can't remember what the NFT fluffer sale was valued at. It was in the hundreds of millions, but most people have their megatokens from the $999 million ICO. And so we are a little bit over 50% above. So those participants are like 50% of. plus in the green, 60%, 70%, 70% is how that works because a 1.7 billion dollar valuation is 70% higher than 999 million. I know how to do that math. Anyways, 50% of the people receiving their megatocans are still holding 40% sold everything. Wow. And 10% partially sold. Does that 40%

Starting point is 00:40:13 number feel high to you? A little bit, but it's also a little high. It's also a bare market. It's a bear market. You got to shake out the wheat hands. Weeans. This is hot money. Of course. And so, I mean, it could have been worse. The fact that it's hanging in there at 1.5 billion is like pretty good for our bare market launch. Right. After 40% sold everything and we're still clocking in 1.7 billion. I feel that's, that feels healthy. We'll see where it goes from here. DeFi United. Okay, last week we talked about defy's worst hack, probably ever the Kelp Dow hack. David, this week we're saved and we're saved by Defy United. So let's remind folks where we left things last week. We were short about 76,000 ETH. This

Starting point is 00:40:52 was an AVE. It was ETH that was supposed to be backing RSETH that was no longer there because North Korea hacked it all. So there was a hole and there's a question of how to repair the hole. Well, Arbitrum did free some funds from North Korea. That was about 30,000 ETH, but that still left a pretty large hole in ETH denomination, about 42,000 ETH. So the question was, 45,000, thank you. How do we fill the hole?

Starting point is 00:41:22 And we left. last week's episode, not knowing who would get the haircut, how this would be fixed. Assuming that hole is just the hole, like, sorry, it's shit out of luck. That's just how it is. Well, what's that if we do the math? Is it 100 million over 100 million? Something like that. Close to it, right?

Starting point is 00:41:36 About 100 million. Okay. All right. So what happened? Defi United happened. What is DeFi United? A bunch of people came together and made donations. And also loans.

Starting point is 00:41:48 So some of these things are loans as well. And we'll talk about that structuring. Stani, the leader of Abe, the founder of Avey, he donated 5,000 ETH, saying, Ave is my life work, wants to, just making sure that the legacy of Avey is as sound as possible. So tip of the hot to Stani. But a bunch of other people as well. Consensus and Joe Lubin donated 30,000. Mantle is lending 30,000.

Starting point is 00:42:13 Avey Dow putting up 25,000, Etherfi, putting up 5,000, layer zero. 5,000, Lido, 2,050. Was consensus really a donation? Was Joe Lubin really a donation? Or is that a loan? It seems hard to believe that it was donating 30,000. Some of these things are loans. Some of these things are donations. The loan, the mantle is a loan. And some of these terms are kind of interesting. So the interest that Mantle gets is the Lido staking yield plus one more percent on top. So roughly 4 to 5 percent APY in ETH terms. For up to three years, Avey can repay with no penalty.

Starting point is 00:42:48 as collateral, AVE puts up 5% of ongoing protocol revenue and $11 million in AVE tokens. And that is held in a multi-sig wallet that Mantle controls. The interesting thing here is that Mantle gets the voting power over over 130,000 delegated AVE tokens. So basically with this loan, they get a governance seat, a very significant governance seat. And maybe this also helps deploy Avey on Mantle. And so there's a business opportunity for Mantle. And I expect to anyone else doing a loan is also working strategically like that as well.

Starting point is 00:43:25 I mean, but the point is the defy community came together, raised these funds, plugged the whole. There's a total raise 311 million to plug this one. That's over and above what we needed, isn't it? I don't know what we do with the remainder. But so, and I don't think that this was just, let's say, pure altruism, of course, right? Some of these are calculated business decisions because it. would be good for all the parties involved to make sure that we support defy to make sure it doesn't go anywhere, to make sure the faith in defy is restored. But that's all fine.

Starting point is 00:43:57 In fact, that's a stronger mechanism to me than pure altruism. Than just donations, yeah. It does show. At the end of the day, if you're somebody who's part of that hole and you have less ether, you don't care. That's right. And it shows defy can recover. No public funding, no taxpayer funding, it can coordinate, it can repair, can create

Starting point is 00:44:16 win-wins, and it's strong in the aftermath of this. So a fantastic show of faith. I think it's incredibly bullish. Avey released a detail on how they plan to repair the R.S. Heath backing as a result of Defi United. It's all here. Of course, this is like a one-time kind of fix. We can't, we can't be doing this every week, David, right? No, no. We can. So we still. But you know what we can be doing every single week? And not only every single week, Ryan, What? But there was basically a defy exploit in the month of April every single day. Every 27 hours is what I'm reading.

Starting point is 00:44:56 Every 27 hours, there was a defy exploit. You know, some of these were small, like $50,000. Yeah. Some of them were large. But at the end of the day, like there's a tweet here. April 1st, Drift 285, April 3rd, silo V2, 3194,000. April 4th, whatever TMM is, 1.6 million. Like, do you see this?

Starting point is 00:45:16 This is wild. Yeah, a total of, some of those were denominated millions, by the way. So a total of 630 million stolen in April. Worst month ever for defy, which cannot be sustained, no matter how coordinated. Doesn't matter how much we help each other out. Okay, so permanent on-chain, like insurance fund, we need some of that. We need L2B style disclosures. We need to harden everything.

Starting point is 00:45:42 These hacks, we need circuit breakers. We've talked about that. these hacks will not stop coming because AI is like this is a guy this is got to be a this is got to be it's got to be a got to be yeah can I I I don't want to tease anyone who's gotten lost money but can you can I show you my favorite one of these yes where coming in at the 18th largest exploit out of 24 scallop land scallop lend scallop lend hacked for 150,000 dollars I had never heard of scallop lend before so you're saying you know I shouldn't put your funds in anything shady.

Starting point is 00:46:16 I'm sure they're great people. Put your funds into things that are too big to fail. Like, AVE, right? Did I just curse us? I mean, it was fantastic to see the Defi community show up for this and set things right. David, we got more coming up. The special ops soldier was arrested for using classified information for a $400,000 bet he made about the U.S. Very profitable trading strategy.

Starting point is 00:46:40 Yeah, the U.S. probability of invading Venezuela. he happened to be one of the people invading Venezuela. So that's a crime. Also, the Attorney General of the U.S. at the Bitcoin Conference said code is not a crime, but can we believe him? Those stories and more are coming up. But before we do, we want to thank the sponsors that made this possible. You would have never thought two years ago that you could soon be trading tokenized oil on Metamask.

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Starting point is 00:48:21 structured products on top of real world yield. Even the best carry trades can be within reach. Bricks brings Defi's promise to the emerging world and brings the emerging market yield to your wallet. Let the yield flow with Bricks. On Thursday, a U.S. Soldra was charged with using classified information to profit from prediction market bets. This is an interesting name on this individual. Gannon Ken Van Dyke made more than $400,000 on polymarket by trading the fact that there was going to be a U.S. military operation to capture Nicholas Maduro in Venezuela. He was one of those Navy SEALs, what were they, military members, who actually did the invasion of Venezuela. So he would know. And so he bet on it and surprised he won. Fantastic trading

Starting point is 00:49:10 strategy turned $34,000 into $410,000 days before Trump actually announced the operation. Is that illegal? It turns out it's highly illegal, David. I mean, this is classified information. So this is from the CFTC report, who's kind of the cop on the beak here. You know, his handle was burdensome hyphen mix. And this has his crypto address here. This was his first trade ever, a very profitable trade.

Starting point is 00:49:39 first trade. And the question posed was, will the U.S. invade Venezuela by January 31st, 2026? And he purchased the yes on that one because he knew it advanced what would happen. So obviously, this is illegal. The CFTC prosecuted him. This is Shane Copeland from Polymarket, the CEO saying, grateful the DOJ officially acknowledged Polymarket's cooperation on this case. The reality is we work proactively with all the relevant authorities. We flagged this. referred it and cooperated throughout the process. So this happens behind the scenes. And by the way, he said, I'm going to paraphrase, all of this was on chain. So the transparency of having it on Polygon, on chain means criminals have less ability to get away from this kind of thing. So I wonder.

Starting point is 00:50:28 I think I remember reading a story where the individual emailed Polymarket and it was like, hey, can you close my account and delete all my data? Oh, shoot. It doesn't work like that. David, there's a scuffle that the CFTC is having, in addition to restoring market integrity by prosecuting crimes like this, the CFTC and Wisconsin are in a bit of a battle. What's this about? So the state of Wisconsin had filed lawsuits against Calci, polymarket, crypto.com, robin hood, coinbase,

Starting point is 00:50:57 all entities that have prediction markets on their platforms. And so Wisconsin's going after all the platforms. CFTC responded by going after Wisconsin saying, hey, this is our turf, get off of our turf. Back off. Yeah. And Mike Selig made that video saying, I'm totally going to do this if the states come after my prediction markets. Yeah. And that's what happened. And here we are. The quote from him, states cannot circumvent the clear direction of Congress. So he is going hard after the states enforcing his jurisdiction. David, the attorney general of the U.S.

Starting point is 00:51:34 went to the Bitcoin conference we were talking about in Vegas and told crypto developers code is not a crime. I'm going to play a clip. Third party participants in crypto shouldn't have to keep, you know, sleep with one eye open anymore

Starting point is 00:51:49 that the feds are going to come along and charge them. If you are a non-consideratee developer, you shouldn't have to sleep with one eye open. If you're developing software, if you're a coder, you're not a third-party user and you're not helping and knowing the third party

Starting point is 00:52:02 is using what you developed to commit crimes, you're not going to be investigated and you're not going to be charged. He went out to say, the mere fact that you happen to be a coder doesn't excuse you from criminal liability, of course. So... You know who would love to hear that? Who? Roman Storm. Has anyone told the people prosecuting Roman Storm what they are doing?

Starting point is 00:52:23 Okay. So this is a question of like, what are they saying versus what are they doing? And I was kind of confused at this because Roman Storm, we reported, we talked about earlier in April, he's actually being retried by Jay Clayton and the Southern District of New York. And Jay Clayton is the U.S. Attorney General for the Southern District of New York. And they're deciding to re-prosecute him. They just made this decision in April. And yet here is Todd Blanche, the acting Attorney General of the DOJ from Washington, D.C., coming into a Bitcoin conference saying, we're not going to charge non-custodial developers.

Starting point is 00:52:58 So, like, what gives here? Why is there a discrepancy? Do you have any theories on this? Um, I mean, my, my theory is that they're just not walking the walk. I don't know if that's a theory. I think that's what it seems like. Yeah, it's like words, words are cheap. Yeah, this is Peter from a coin center who said that, you know, this is a better message coming from Todd Blanche than we've received in the past from the DOJ. But it's still not enough. It's still not sufficient. A publication I follow called The Rage Report. reported on this, the DOJ cannot credibly claim it has changed the game while still prosecuting Roman Storm. The precedent, the Southern District of New York is trying to set is wholly at odds with Blanche's memo and the president's policy. Because there's this question of like, how much did the non-custodial developer know about nefarious actors using it? And in the Roman Storm case, knowing was reduced to a single federal officer email asking to launder some proceeds. And, you know, was enough or, you know, Roman Storm's registration of a user interface or a domain, that, you know,

Starting point is 00:54:10 that could be enough to prosecute him. So we don't have enough clarity in this case. And there does seem to be a discrepancy because on kind of the hierarchy here, Todd Blanche, the acting attorney general who we just heard from, he should be the top dog. He should be the DOJ. He's top of the food chain. And yet Jay Clayton, who is more of a local prosecutor, he has autonomy to kind of run his own cases. So, but Blanche does have the ability to tell Jay Clayton to call off the dogs. And that hasn't happened yet. So will that happen to me? If that happens, then they're actually serious about this statement. If it doesn't, it's still lip service. Do you think that Todd Blanche just knows about the Roman storm case or does not know about the Roman storm case? And so the disconnect is the

Starting point is 00:55:00 know. So he was asked about it at the conference. Didn't really have a good answer. Maybe it's like a unique case to them. It's kind of carve out because North Korea was involved because of the amounts. So this code is not crime shift seems mainly like it applies to new cases going forward, not to Roman Storm. But again, I mean, unless it applies to Roman Storm, I don't understand how they can be serious. Roman Storm tweeted about this. That's the important one. That's the real test. Yeah. I mean, he said you can be, this is Roman Storm, you can be prosecuted for your software. you will get prosecuted. You know, he's reporting the rage of report, like article that I mentioned earlier.

Starting point is 00:55:39 So Roma Storm and his legal team does not see this as sufficient or that they're treating this seriously while his case is still ongoing. Right. Ryan, we save just the best news for last, the most exciting news and the whole weekly roll up. Are you ready to talk about it? Oh, yeah, let's do it. Stable coins and meta. I've met at a company. For stable coins, VISA stable coin growth,

Starting point is 00:56:03 $7 billion run rate, that's up 50% quarter over quarter. So it's just a statement on just the industry sector growth of stable coins used in payment by tradfai companies. So that's pretty cool. And they're adding all these chains, right? They're adding all the chains they can. Arc base count on polygon tempo.

Starting point is 00:56:25 Some of these I like, some of these I don't. But the big news out of meta is that meta has started to pay some of his creators. You know how all the social media applications, Instagram, X, they all kind of like pay creators now because that's just the meta of paying people to get. I didn't know that. I know on X people get paid, but that's happening in YouTube. Like YouTube started it. Oh, for sure. Forever ago.

Starting point is 00:56:46 I guess so. And then like X copied them and then now meta copies them. And so there's just like native payments for impressions built into the app. Right, right. So, like, I have, do you have your ex-creator? Like, I do. Yeah. I get, like, $90 every two weeks.

Starting point is 00:57:05 Oh, dude. I get nothing. I get $400 a month, David. That's pretty good. That's pretty good. That's not bad. Yeah, it's something. Anyways, Meta, I don't, I get $0 from Instagram, but other people do.

Starting point is 00:57:17 And so, meta allows stable coin payouts for Instagram creators with Stripe. And the cool thing I thought. about this is like it's one thing if you're in the United States and you don't really you don't really need this because you just wait the payouts are in stable coins US through C on salana or polygon through stripe oh very cool okay the stripe is the um the just a manager the mediator yeah ties it also generates tax documents which is also important for these big companies tied to the actual creator earnings but one important thing is it's like you know Instagram creators are global so or X but Instagram too

Starting point is 00:57:56 I guess. And so a lot of this hap is made easier because they are able to pay out people from any country that's not really well service in the banking sector. A hundred percent. And so logistically speaking, it is so much easier for them to pay out creators with USC on Solana or Polygon supported by Stripe with tax documents than it is to have to just like navigate the mesh network of banking. You got to imagine they'll use tempo too, right? Yeah, you imagine. Yeah, yeah, yeah. Whatever they want. This is a new consumer wallet, or I don't know if it's new. Maybe it's been in existence, but that's rolling out the stable coin support that I believe

Starting point is 00:58:32 meta is officially going to push to. It's called the link wallet from Stripe. It's basically it's a consumer crypto wallet. Yeah, it's like a shop competitor. You can use a credit card in it, but you can also use stable coins as well. Stripe is just shipping really hard when it comes to stable coins. Speaking of highly valued private companies that I don't have access to. Oh, yeah.

Starting point is 00:58:54 Well, you will once it hits over a trillion dollars, David. You can buy publicly like all the other clubs. So there's that for you. Guys, let's end with this. None of this has been financial advice. You know, crypto's risky. You could lose what you put in, but we are headed west. This is the frontier.

Starting point is 00:59:08 It's not for everyone. But we're glad you're with us on the bankless journey. Thanks a lot.

Bankless - ROLLUP: $120 Oil vs New Highs | AI Boom Masks War | IPO Top Signal | DeFi Bailout

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