Bankless - ROLLUP: 3rd Week of February (ETH & BTC ATH's, NFT's, Andrew Yang, Bitwise DeFi Index, Reflexer launches RAI)

Starting point is 00:00:00 Hey everyone. It's the third week of February. Happy Friday morning. David, what are we doing today? We're rolling up the third week of February. The crypto world moves so incredibly fast. And so Ryan and I go through a week's worth of news as fast as possible. So get that coffee ready because we're coming at you hot. Here's what we do. We always talk about the markets. What are the markets saying? Then we get into releases, what got released in the last week. Then we go into news. What happened in the news cycle? Lastly, we finish up with some ecosystem takes, who had some good opinions in the world of crypto in the last week. And then we finish with what Ryan and David are excited about. And then, of course, the meme of the week. The meme of the week is a new future. Super excited to get there.

Starting point is 00:00:56 It's like the dessert at the end of a fantastic meal. David, are you ready to roll them up? We're rolling it up. Let's do it. All right, David, before we get into the roll-ups, we should tell our audience what lattice is. These are really cool devices. You've got one sitting over there, right? Yeah, it's a new hardware wallet.

Starting point is 00:01:13 It's a different kind of hardware wallet. It's not a mobile one. It's one that kind of feels a little bit similar to your Amazon Alexa, your Google home. You leave it at home. And it's got a big screen for you to digest the transactions that you are about to approve. It's kind of the new standard in security. And I've been having a lot of fun, just playing with it. It's pretty cool.

Starting point is 00:01:31 Yeah. Ladis wanted us to let you know that they are back in stock for the bankless nation. So we will include a link in the show notes. If you want to pick up a shiny new. lattice wallet. They are back in stock. All right, David, you're ready to get to markets. Let's do it. There's so much is happening in the markets. That's for sure. Always. Always and forever. Let's start with the Bitcoin market. What is going on with Bitcoin. Did we just hit another all-time high, my friend? You know, once again, I actually can't remember the last time

Starting point is 00:01:58 we've done one of these where crypto hasn't hit all-time highs. But yeah, Bitcoin $52,000 cross the $50,000 mark after flirting with just being under it, right after Elon, Musk announced the Tesla $1.5 billion purchase of Bitcoin. Bitcoin shot up to like $48,000. And then it hovered there all of last week. And now this week, we are finally crossed over that $50,000 mark. So congratulations to Bitcoin for breaking $50,000. That is a milestone. 50K per Bitcoin. Pretty impressive. What's ETH doing this week, David? Ether, also breaking all-time highs literally as we record, as we speak. Ether is 1933. $1,9333.

Starting point is 00:02:44 The way this is going, I expected to be higher by the end of this recording. So we will see. Yeah, by tomorrow morning when you're listening to this, it may have hit 2K. It may have hit 1,800. Who knows? There's a lot of variability here. But it is on a tear. I wouldn't be surprised if we're 2K by tomorrow morning when you're listening to this.

Starting point is 00:03:02 We will just see, ETH has been an absolute tear as well. So has total locked value in DFI. It is up again hitting all-time highs, what, number is locked in defy now. $42 billion locked in defy. Last one we recorded, it was right under $40 billion. So in the last week, we've piled on two extra billion locked in defy. And of course, the DPI is up to $430.

Starting point is 00:03:27 I remember when we started recording this, Ryan, DPI was like an 80 or something when we started doing the weekly roll-up. So DPI has been on an absolute tear. It is down a little bit on the week, though, which is interesting. And I think this kind of reflects in a ratio that we've been tracking on the roll-up that it, you know, indicates the seasonality we are in in crypto. And this is the DPI to ETH ratio. Do you want to talk about this ratio why it's important and what we're looking at this week?

Starting point is 00:03:54 Yeah, DPI, of course, is the index for DFI, the top 10 defy assets. And I've been paying attention to the ETH-DPI ratio because it's a stronger signal, in my opinion, and then the DPI to U.S. dollar price because the dollar's inflationary, highly inflationary. And really, Ether and Bitcoin are the new benchmarks. And so especially with Ether and Ethereum, DPI priced versus Ether really indicates how risk on people are being, how far down the market cap stack people are looking at. And there was a pretty strong retracement in DPI versus Ether in the last week. And so it hit a high of 0.26 DPI per ether.

Starting point is 00:04:36 And now we are down to 0.225. But overall, DPI is performing really, really strongly versus ether, but taking a little bit of a retrace lately. Yeah, it's interesting because it's not like DPI is necessarily weak. It's been, you know, relatively consistent versus last week. But it's just that ETH has been on a tear, which means the DPI to ETH ratio obviously goes down in those types of conditions. So David, let's jump to this tweet by Josh Stark, who noticed that there are 173,000 Bitcoin on Ethereum right now. That number is also up. And he also takes us in this tweet

Starting point is 00:05:15 where he kind of compares it to total Bitcoin supply. It's almost 1% of all outstanding Bitcoin is now on Ethereum, which is absolutely huge. And if you compare it to sort of the more Bitcoin-centric, Bitcoin Maxillus, maybe I might say, scaling solutions like Blockstream's Liquid. There's 63 times more Bitcoin on Ethereum than Block Streams Liquid. And there's 158 times more Bitcoin on Ethereum than there is on the Lightning Network. Now, what do you make of this? Yeah. First off, this is something that fits in the Ethereum native narrative, excuse me, is that Ethereum is this nexus of economic activity. It's a black hole of assets. Assets are more useful on Ethereum.

Starting point is 00:06:03 There's Bitcoin and then there's Bitcoin on Ethereum. And Bitcoin on Ethereum is straight up more useful than Bitcoin on Bitcoin. So there's this natural gravitational pull to pull assets into Ethereum. And like Lightning is just not really doing the things that people that Bitcoiners really wanted it to be doing. And I think there's a very strong case that all of the use cases of Lightning are going to actually be facilitated by Bitcoin on Ethereum's L2s. like perhaps loop ring. Loopring is fast, instant payments, trustless payments in the same way that Lightning promised that.

Starting point is 00:06:36 But I think that we wrapped Bitcoin on Ethereum is actually going to facilitate some of the same demand for Bitcoin on the Lightning network. So Lightning is based on State Channel technology. And it's interesting to me, David, that state channels didn't really take off on Ethereum either. And they're not taking off on Bitcoin. Fortunately, for Ethereum,

Starting point is 00:06:54 there are other layer two approaches available on Ethereum. We're talking about one in the podcast that comes out on Monday morning, which is roll-ups primarily. But, you know, Bitcoin has only had sort of this one bullet in the chamber, which is lightning. And it's not sucking in a lot of Bitcoin right now. The crypto banks certainly are. Ethereum certainly is, but not lightning.

Starting point is 00:07:15 All right, David, let's talk about miners for a second. ETH miners are making bank right now. It's insane. They made a total of 830 million in January, dude. And 40% of that was fee revenue, right? So again, miners make revenue on any blockchain, including Ethereum or Bitcoin in two ways. One is issuance. So they get a reward based in ether every time they mine a block successfully. So that's issuance reward. And they also make fees on the gas that you pay or the transaction costs that you pay on the Bitcoin network. These two fee structures

Starting point is 00:07:54 combined to form the total minor revenue. And what's amazing here is now transaction fees compose 40% of total minor revenue on Ethereum. So what do you make of these high numbers and that proportion of fees being minor transaction fee revenue? Yeah, this is just a very strong signal as to what the longevity of Ethereum could be, right?

Starting point is 00:08:21 The way that you understand a blockchain to be able to live long into the future is demand for block space. And Ryan, if you click on that image, it'll blow it up a little bit bigger. Look at that bar on the right. That red part on top of the blue part, that's the fee revenue. And the blue part is the issuance, right? They're almost equal. They're almost equal in fee revenue to issuance. And what that tells us is that if you take that fee revenue side of that bar chart, it's larger than all of the revenue that Niners made in like the bear market for almost an entire year. Like the fees that miners made in the last couple months matched the entire fee, the entire issuance and feeds that they got in like 2018 and 2019.

Starting point is 00:09:04 And this is really important. This is super, super important. And the reason why is because if your blockchain can collect fees, if the validators can collect fees, you don't have to issue as much currency to fund security. That means that your asset will be having less. issuance, which means your asset will be more scarce, will be more hard. The more fees that are collected, the less you have to issue. And so the whole narrative around like this Bitcoin hard cap is still thrown into question because we do not see this same minor revenue from fees in the Bitcoin network. The whole narrative around Bitcoin is that at some point, issuance will be replaced by fees. Yet we are already seeing this in the Ethereum blockchain.

Starting point is 00:09:52 We are seeing a 40 out of the 100% of total revenue, 40% of that is fees paid to miners in ether. I don't know what the Bitcoin fee percentage is. I think the last time I checked it was like 10 to 15%. But ether and Ethereum is already out competing Bitcoin in long term sustainability. Ether's ultrasound money. It's so ultrasound. We got to talk. I want to talk to things about this too, David, just to add on to what you're saying.

Starting point is 00:10:20 It is the case that if all of the Bitcoin were issued, as is the plan, right? And let's say all of the ether were issued, that Ethereum would be a higher security network than Bitcoin today if they were both based on just transaction fee revenue, which means Ethereum's blocks are more valuable than Bitcoin's blocks, which is interesting because Bitcoin is the one switching to 100% transaction fee revenue, which is not its strength. It's is a meme store of value. Its strength is not the value of its block space and its network. So it's kind of switching from its strength to its weakness in its issuance policy. And again, issuance policy is also security policy. So these are tradeoffs that, you know, people often confuse. The other thing I wanted to say is all of this, this red section that you're pointing at on the graph, guess what happens to this red section, guys? EIP 1559s means, it starts to go to holders. This red section, a large proportion of it, starts to get burnt when EIP 1559 is active,

Starting point is 00:11:29 which means it actually decreases the ether supply. So I don't know how much we're looking at here, David, but like 829 million, right, in January, 39% of those were fees. Let's say it's like 300 million or so, something to that effect. The large proportion of that would be burnt under EIP 1559, say 200 million. $250 million of fee burns. That's a de-inflationary pressure on ether in the scarcity of eth. So this chart is, while gas fees suck, right, like it is long-term, very bullish for

Starting point is 00:12:05 the health and security and the product market fit of the Ethereum blockchain. For all the visual learners out there and for those on the podcast, you should check out the YouTube because there are plenty of things to look at. Take that red section and then take that. that an equal amount of the size of that red section and like delete it from the blue section, right? And so like all of that red fees that you're seeing, you can actually remove the issuance, right? And so if you remove the red part from the blue part, that is actually the issuance of ether. And if the red part continues to go up and up and up, the blue part will

Starting point is 00:12:41 continue to go down and down and down under an EIP-1559 paradigm. And just like that, this whole roll up turned into an EIP 1559 episode. We can go on for 10 or 15 more minutes about this, David, but we've got to move on. It's so cool. It is awesome. It's a revolutionary part about this whole entire industry right now. Yeah, and it's so underrated. Like, most people don't understand this. This is not the popular Main Street narrative. This is the stuff that, like, you're hearing from bankless because, you know, people in the bankless community are actually looking at this stuff. Anyway, we've got to move on. This is a really cool chart, David. This is Companies by Marketcap.com. cap. Yeah, so this section is banks by market cap. So you can look at a total Fortune 500,

Starting point is 00:13:23 all the biggest companies in the world. You can also just narrow it in by banks. And what I love about this is if you rank all of the banks in the world and compare that to these new crypto banks, Bitcoin and Ethereum, Bitcoin ranks number one. It is now the biggest, I guess, money bank type system, transaction system by market cap. So it beats J.P. Morgan Chase. It beats Bank of America. It beats ICBC. And Ethereum is number five in this. Four. Number four versus the banks, five, if you include Bitcoin. Exactly. So it is number four versus the banks. Maybe we'll focus on that. So it has a ways to grow to beat JP Morgan Chase, David. But if it doubles, if we're if we're seeing Eth at, you know, 3,000, if we're seeing ETH at 4,000 per ETH, then it becomes the biggest banking system by

Starting point is 00:14:18 market cap in the world. So what this tells me is that ETH is climbing right up the banks to the banks in terms of value, but it's still also undervalued, right? Like if you compare J.P. Morgan Chase, which is 440 market cap, billion market cap versus Ethereum right now, which is a 221 billion market cap, what's more valuable? the credibly neutral money system for the entire planet backed by a reserve asset store of value money or boring old JP Morgan Chase. I guess that's for investors to decide. Right. And Ethereum, like banking services is just one of Ethereum's possibilities, right? That's just one thing it can do.

Starting point is 00:14:58 It can also do like NFTs and art and gaming like and all the other things. Like just banking is selling Ethereum short. It has a multitude of possibilities and it's still just half the market cap of J.P. Morgan. All right, David, the last thing we should explore in market section is this chart, which is really exciting to me as kind of a bankless maximalist as I know you and I are and a decentralization maximalist. So this is from glass node.com. They put together fantastic metrics on this that I haven't seen anywhere else. And this is a charting on Ethereum, the percent balance of eth supply that's on exchanges right now. And you can see this chart over time. versus it's compared.

Starting point is 00:15:41 That's the blue line here is the percent balance of ETH supply on exchanges. And the gray line here is Ether price. And you can kind of see it ebb and flow. But the good news is the balance of ether on exchanges is going down. And what that means is it's going to other places, essentially, primarily back to the Ethereum network, primarily back to people's wallets, back to the decentralized. finance back to being bankless out of crypto banks. And right now, there was at kind of the early stages, I guess, of this bull run, about a year ago or so, about 17% of all ether supply on

Starting point is 00:16:25 crypto exchanges. And now there's 13% and it's continuing to drop. This is really good for the bankless revolution because we want smart contract custody as much as possible. We want self-custy as much as possible. We want a self-sovereign monetary system. We want decentralization. So this to me is a bullish stat, David. What's your take? Yeah, it's also doubly important for Ethereum versus Bitcoin to not have too much ether on exchanges because ether is a staking token, right? And so we want people to be staking themselves, either through a decentralized service provider or just doing it at home. Too much ether on exchanges is less than ideal. That means there's a lot of consensus by exchanges. And while there are reasons to why that's not the end of the world, it's still better if people are staking their ether at home.

Starting point is 00:17:14 And ether having this exodus from exchanges is good for that. And it's also good for the price. It's both a symptom of increasing price because when people buy ether, they remove it from exchanges. And then also there's less ether on exchanges to be bought. And so any further buying pressure increases the ether price at a faster rate, the less and less ether price there is on exchanges. I think you can note that the lowest ether percentage on exchanges there's ever been was at the previous ETH all-time high in 2017, or just in January of 2018, when Heath had peaked out at the last point in that cycle. And so ETH continuing to leave exchanges is just indicative of this being a bull market. And we want that to continue. Absolutely. Well said, David.

Starting point is 00:18:00 All right, we are going to tell you a little bit about the fantastic sponsors who've made this episode. possible and then we will get to the releases. Stay tuned. Guys, we've entered a bull market. Now is the time to start building your crypto empire and you should do it on Gemini. You already know Gemini is the world's most trusted crypto exchange, but now you can do even more than trade. You can earn. You can take one of your crypto assets and park it in an interest earning Gemini account where you can get up to 7.4% annualized. There's nothing more satisfying than earning passive income on an asset that you're already bullish on. This is a crypto native superpower. You know what's coming soon too? A Gemini

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Starting point is 00:19:30 With AVE, you can leverage the full power of defy money Legos, yield, and composability all in one application. On AVE, there are a ton of assets that you can deposit in order to gain yield, and all of those same assets can also be borrowed from the protocol if you have deposited collateral. Here you can see me getting a 200 USDC loan against my portfolio of a number of different defy tokens and ETH. I'll choose a variable interest rate because it's a lower rate than the stable interest rate option, but I could choose the stable interest rate option if I wanted to lock that interest rate in permanently.

Starting point is 00:20:04 One of AVE's V2 features is the ability to swap collateral without having to withdraw your assets, trade them on uniswap, and then deposit them back into AVE. AVE does all of this for you all in one seamless transaction, so you don't have to repay loans in order to change the collateral you have backing them. Check out the power of AVE at AVE.com. That's AAVE.com. All right, David, we're back with Relatural. leases we got to start with this one i think this is big news people so that is the the the artist mainstream

Starting point is 00:20:35 artist who sold millions of dollars in nfts in december now be people art is bringing the nfti revolution to christie's christie's is an auction house david have you heard of christies before not at all i have no idea okay so like i don't i don't know much about the um kind of the the art scene i don't buy a lot of art myself, you know, when I do, it's like NFT form. But Christie's, I believe, is an auction house where a ton of the most popular art is auctioned off. So this is how like art collectors in the real world buy art. And liquidity for art. This is liquidity for art in an auction style because every NFT is different. So these are non-fundable sort of, you know, collectibles, of course. They can't just trade them on an exchange. So they typically auction them off. And they

Starting point is 00:21:26 Dese at Christie's. Well, an NFT is being auctioned off at Christie's for the first time. Wow, I'd love to be able to fly on a wall during that process. Like, like these art collectors are getting educated in NFTs, in Ethereum. This is like, you've talked so often, David, about Ethereum having a ton of surface area, particularly this bull cycle to, to collect mainstream interest. And NFTs are a big part of that surface area. now we're at Christie's auction house with some of the most wealthy people in the world, educating them about NFTs. That's big. Yeah, yeah, that's absolutely huge. Again,

Starting point is 00:22:05 like I would love to watch. I don't know who these people that attend Christie's would be, but I would imagine that they are older in their lifespan because that's kind of the cohort of people that engages with art. It's people that have had time to accumulate the wealth. And so I would be interested to see like what, how do you even display art like an NFT art at Christy's like, are they bringing, are they like wheeling a TV onto the stage to show the, to show the art? I don't know. But congratulations to Beeple for just being a fantastic pioneer with the NFT space.

Starting point is 00:22:36 And this is just extremely legitimizing. NFTs are really, they've been having a moment, but especially in the last like one to two weeks, they've really started to just rocket ship into the mainstream mind share. Yeah, and it's cool because Beeple's kind of like an apostle of this because he both loves NFTs and he loves kind of decentralization. and everything that's going on in D5. But this is not the only reason. He's in it to make money.

Starting point is 00:23:01 There's a tremendous amount of economic opportunity here. And at the end of the day, that's what's going to draw the world into crypto. Is the economic activity in this new land of infinite white space that can be had here. And that's exactly what's happening. Like billions of dollars of economic activity is going to draw the world into here. Speaking of which, let's talk about the first Bitcoin ETF in North America. That's the headline I saw. Speaking of which.

Starting point is 00:23:31 Speaking of which. But this is in Canada. It's not in the US yet. But I think it's still a big deal. Ontario securities regulator approves the first. You would think it's a big deal, Mr. Canadian. But I don't know if bankless solicitors know that I am Canadian and American. I get my dual citizenship.

Starting point is 00:23:48 So I snuck this headline in because. I'm, you know, Canadian nationalist here. Anyway, I think this is big news and it's interesting. I mean, U.S. regulators have got to catch up to other jurisdictions. Do they not? This is a race. This is absolutely a race. And the most crypto-friendly jurisdictions are going to be rewarded for this.

Starting point is 00:24:11 And I would always say Canada is generally a little bit ahead of the curve when it comes to stuff, generally, just stuff. And this is an indication of that. Yeah, absolutely. So it's good news. Hopefully an NFD, an ETF is on the horizon in the U.S. as well. David, let's talk about Rye. This is a, we, we, I talked about this a little bit at the end of roll-ups is something I was excited about these new kind of money primitives, algorithmic, almost money primitives that were coming to Ethereum. And then here's one of them. What is Rye? It's been released. It's now live. What is it? Yeah, Rye is a crypto-native.

Starting point is 00:24:50 form of stability, right? And so rye, for those that don't know, rye stones are these very ancient, like massively, like massive stone disks that were used in like this island. I don't know where. I've got a picture. Oh, yeah. Yeah. And it's a lesson about money, right? And so these things were a very early primitive form of money for these guys, these people that lived on the island. And so they, if you go in like many, many Bitcoin podcasts and like history of money podcasts, like use these rye stones as an example of how money forms. And so it's like a ledger, right? Like each of these stones represent.

Starting point is 00:25:25 Represent. No one moves them, but they trade ownership of them as if, as if it's a ledger of some sort. And that's how their money system worked on this island. Right. Yeah. And so I think that's actually the only similarity between rye and rye stones and this Rye project is just a name.

Starting point is 00:25:39 But what's really cool about this Rye project is that it is self-referential stability. Right. And so the fantastic thing about Maker Dow is that it produces die and die is worth one dollar. The shitty thing about that is that the dollar sucks, right? The dollar is just exporting the brand of the dollar into defy. Rye is a self-referential stability. And so it's a little bit nuanced and it's kind of not really the right time in a roll-ups to really explain how self-referential stability works. But understand that it is a native native peg that doesn't need the currency, an external reference point to become stable.

Starting point is 00:26:20 It's stable to itself. And so this is about self-sovereignty. This is about escaping the dollar and creating our own native forms of stability inside of Ethereum. And the best part about this is that it's also very similar to Maker Dow, except one of the biggest differences is that its governance minimized, where Maker Dow is very happy to have governance, that's part of the Maker Dow protocol. What that leaves is that there is a potential for a governance minimized version of stability. And this is what Rai is. One of my friends, Amin Soleimani, is part of this. And also Stefan, who was actually the first meet the nation that we

Starting point is 00:26:57 ever did for those that want to go back and learn about die. That's a great resource. And Amin did this fantastic article, which, and his writing is really, really good. So definitely go check it out. And he talks about the concept of like a new money god. He, Rai is like this new money god. And what Amin is really talking about is a self-perpetuating DFI protocol that doesn't have human control, a uniswap, right? A uniswap where, at least with uniswap v1, where there was no governance and it just perpetuated. And because it required no external human dependencies, no external human actions,

Starting point is 00:27:35 this thing can just perpetuate in the same way that Bitcoin, just perpetuates. There's no external dependencies for Bitcoin. It just continues. And so Amin calls this like a money god because as soon as it's turned on, the theory is, the hope is that it can't be turned off. And it's all of a sudden here for the rest of time so long as Ethereum exists. So I'm very optimistic about the future of Rye. Yeah, it's super cool. And it's all based on ETH, right? So all of the collateral is ETH only. So that's what gives it its censorship, it's incredibly neutral properties. You know, the other interesting thing about this, David, is like this theme we talk about so often on bank lists is that every experiment that can be tried in DFI will be tried. I remember there was kind of a fork in the road for the maker project.

Starting point is 00:28:19 There were kind of two directions it could pursue. One was, honestly, it's this Rye direction, right, where you just, you know, collateralize the entire thing by ETH, but you make some tradeoffs in some other areas. And the other, and maybe you don't peg it directly to the dollar anymore. And the other direction is the direction that Maker ended up taking, which has ended up as like, dye is a great primitive, stability primitive for Ethereum and for defy. But it also has a ton of centralized collateral. Like there's a ton of USDC and USDT backing it. So it's not as pure.

Starting point is 00:28:54 So the cool thing about this is there's kind of like a fork in directions of the project. Maker took one direction. And now here comes Rye that's pursuing the other direction. don't know if this experiment will work or not, but we get to try it. That is awesome. So we'll see what happens here. It's a pretty cool new primitive. David, tell us about Euler Beats.

Starting point is 00:29:14 I don't know what this is, but tell us about this. Yeah, Euler Beets is a new NFT release, kind of in the same way that Hashmasks got released and also Cryptopung got released. Yulubes is this new NFT experiment. And what's different about this is that it's mostly auditory. It's a music. It's not, there is a visual component. But what's cool is if you click on one of these, Ryan, it's kind of like a record player.

Starting point is 00:29:38 And it'll start to play if you go on to the website. And this graphic will start to rotate. And there will be a music that is performed, right? By this kind of like construction of a pattern, right? It's this automated thing. It's kind of hard to explain. So definitely go to the website. I'm hearing the music now.

Starting point is 00:29:54 It's coming in my head set. And no one else can hear this. No one else can hear it. But it's pretty cool. And so each pattern has its own like musical orchestra to it. It's musical notes. And so what you are buying is the unique pattern that the music is created out of these Euler beats. I think that's phenomenal.

Starting point is 00:30:10 And I think there's a huge world of NFT music's musical pieces that I think is yet to be created. Like imagine the world where like somebody like RAC, one of my favorite artists who's deep into the defy world. I think he might be a listener. What's up? What's up, Andre? Creates, like create songs and then have those songs become tokenized where you can only listen to the song if you own. a token, right? There's so much design space that's possible here. And I'm really excited to see the world of musical NFTs come about. You know what's cool too. As with Beeple, we didn't mention

Starting point is 00:30:42 this, but as with Beeple, these Euler beats are all denominated in what, David? Ether. Ether. You put out this great, great tweet earlier that art, NFT art is priced in Eith. That is the denomination of NFT art right now. Even in Christie's, basically, the way you you buy that Beeple Art in the Christie's auction is with ETH. It is denominated in Eith. This is an example of Eith serving beyond the store of value, but all the way to the other end of the spectrum, which is like the medium of exchange and even the unit of account. This is an asset that is becoming more money like over time and increasing in its moneyness, which is pretty exciting, I think, for the Ethereum space. Yeah, we're already seeing the explosion in digital art.

Starting point is 00:31:32 And that will be like, like you said earlier, the surface area for Ethereum is massive. And one of those surface areas is buying and selling digital art. And that will all be done with ether. I think the digital art revolution is absolutely upon us. We were seeing that in basically every single indication that we can think of in any type of market participant. Like you don't have to give a shit about Ethereum to care about digital art. You can care about digital art and not really care about defy or Ethereum. But if you care about digital art, you're going to need to have ether to buy that

Starting point is 00:32:02 digital art because things are going to be denominated in ether. Ethan's money, David. All right. I've heard that before. Let's talk about the pool protocol. They just did a community air drop. So David, for our listeners, what is the pool protocol and what did they do? Yeah, pool together is a no loss lottery where you can pool your funds with other people

Starting point is 00:32:24 and for a time period and that time period is one week. And then for that week, all of the funds that are pooled go into some. something that compound, some interest-bearing system. And then it's the interest that is lotteried off, not the actual underlying, not the principle, right? So you will only put your interest at risk, not your actual funds. And so it's kind of like a Layton Kusack CEO founder. I actually met him in Tel Aviv when I did my Ether new model for Money Talk.

Starting point is 00:32:52 Layton is a big fan of just like psychological tricks to get people to save money, right? And so it's a little bit of gaming, but you are actually saving money along the way. because you don't lose anything. It's a no-loss lottery. You can only lose your interest or you gain the interest of like a thousand other participants. And the point is they just air-dropped their pool token. So if you have ever used pool-together,

Starting point is 00:33:14 if you've ever bought a pool-together lottery ticket, you have the pool-together air-drop. So go claim that. Ryan, I think you are a pulled-together participant, or at least you were for a little bit. I did. And you know why, David? Because I follow the bankless tactics.

Starting point is 00:33:28 I subscribe to the bankless newsletter And I follow the tactics. And we released a tactic in September 19, September of 2019, just about pulled together. As a cool D-Fi protocol, you could try. And I tried it at that time. I put like $38 in, 38 die in. And that ended up being worth in this air drop, 81 pool tokens, which, of course, these pool tokens, they're just governance tokens. So they allow you to govern the parameters of the protocol, but they do have a market value. So if I were to sell those 81 pool tokens on Uniswap, at least if I did yesterday, it would have been worth $1,500. So, David, this is another example of using Defi is rewarding in and of itself, but also because of these token

Starting point is 00:34:15 airdrops that are coming down the pike all of the time. We actually release something new to the bankless program, which is an alpha alert email. So what we're going to start doing for bankless members is sending you an alert when something big like this happens and you have an opportunity to make some immediate ROI with an air drop or some big opportunity. So we sent that out the other day. Something timely. So anyway, this is continuing the story of like using Defi is is a very rewarding. It's a rewarding experience all around. David, let's talk about this last interface, which is Dex Guru. This looks like another blue. Bloomberg terminal for Defi. What is this? Yeah, I think we were talking before we started recording,

Starting point is 00:35:03 and I think this take is fantastic, so I'm going to steal it. It's so easy to spin up a UI for Defi, right? This is like the fourth or fifth one we've seen in the last like two or three weeks. It's just a new UII for, you know, Uniswap, sushi swap, you know, Dex aggregation, price movements, blah, blah, blah, blah, like history on trades. It's just a fantastic place to go look at what's going on in Defi. So if you guys want to go check that out, that's Dex.com. guru. Pretty cool. Just a builder's paradise, right? Because like any developer can create wire up their own interface and all you have to do is bring your crypto wallet to that interface. And it's like just bring your money to the interface. You get to select what interface you want,

Starting point is 00:35:42 super empowering for developers and users alike. All right, David. And this is how defy UX and UI really gets fixed because the competition to have the best UI in UX is absolutely massive. Like Dex Guru is entering a very hotly competitive space to be the UI for like Dex activity. Yeah. And you know what? They probably did this with like two developers. And they didn't need to ask anyone any permission in order to do this. This is like the early internet. All right. Let's get to you news. Robin Hood to enable crypto withdrawals and deposits. What is this? Is this due to some of the pressure they were facing from as a result of the GameStop fallout? Maybe. I don't know about that. That would be very interesting if that was the connection. I think

Starting point is 00:36:27 they are what they're really trying to do is following PayPal's footsteps and just trying to get ahead of the crypto game. They already had one foot in the door with when it comes to crypto. And honestly, it was the minimum foot in the door, which is just having exposure to assets, not actually owning them, just exposure to them. Just like IOUs. Rob is an IOUs for Bitcoin or Ether or whatever. Yeah, right. Except you could never actually withdraw your Bitcoin or ETH or ETH. ether. But since crypto's heating up, I guess Robin Hood is finally deciding to double down on what you can do with the crypto side of things. And so now in the future, it's not yet, not live yet, you'll be able to deposit and withdraw crypto assets from Robin Hood. I think the next step is for them

Starting point is 00:37:06 to enable alternative crypto assets that they have in there because it's pretty abysmal in there. If you go into the, there's a folder in there. I actually check this out where you could tap the Ethereum family and see all the Ethereum family assets. Do you know what's in the Ethereum family assets, Ryan? I do just because you've told me and it's pretty embarrassing, but what I tell them. It's Ether and Ethereum Classic. And that is what Robin Hood calls the Ethereum family. That's fucking Robin Hood. Get your shit together. Like get DPI in there. Come on. Well, you know, they are getting their shit together, at least with this. And what I love about this story is this is an example of the competitive pressure that's forcing a Robin Hood.

Starting point is 00:37:46 If they didn't have to do this, they wouldn't. They'd rather keep everything within their within their four walls. But there's user pressure, there's economic pressure, there's competitive pressure. And so they have to open up. That is a good thing for crypto and for the world and for the banking system at large. Let's talk about another good thing for crypto. My favorite. Andrew Yang tweet. Why don't you read out this tweet and talk about it, David? Yeah, Andrew Yang, he tweets out as mayor of New York City. He's not the mayor. He's running for New York mayor. so this is like a tweet trying to say like what he will do as mayor as mayor of new york city the world's financial capital i would invest in making the city a hub for btc and other cryptocurrencies

Starting point is 00:38:29 andrew yang is my fucking guy like he's got it he knows what the future is like he knows how to position america to capture that future to capture that innovation he's an entrepreneur and i he's the right guy for the job let's let's get andrew yang to become the new mayor of the financial capital of the world. That's my, that's my political opinion. That's David's political opinion, right? So like, so what's cool, though, is we're starting to get politicians on board into seeing that this is not a kind of sketchy, like terrorist currency that's only in the shadows, that this is good for their economies. It's good for America. It's good for the world. And it's good for their political prospects. And that's what Andrew Yang is doing here. I'm very certain he believes in the ideals of

Starting point is 00:39:17 crypto, but I'm also certain that he knows it's good for his mayoral candidacy in New York City. So it's kind of a win. And so it's great to see him speaking up. I hope more politicians do so. But look, Andrew Yang brought UBI into universal basic income into political discord, something that like no one ever talked about. So maybe he could do the same thing with crypto, bring that into the wider political party platform and just follow. foster the discussion. And there's so much about Ethereum that really aligns with Andrew Yang's message. Andrew Yang is all about how do we figure out a way to inspire people to create? How do we figure out ways and mechanisms for people to be more entrepreneurial? And like personally, I never really

Starting point is 00:40:05 considered myself as an entrepreneur until I came into the crypto space, until I came into Ethereum, because that's what this space creates. It's a very entrepreneurial, rich environment. And the important thing about Ethereum is the amount of surface area it has for people to be able to monetize their labor. RIC, second time I'm going to talk about Andre. RIC uses Ethereum the protocol to monetize his own labor for himself. Digital art creators making revenue, making a business by creating digital art and selling it on Ethereum. Sushi Swap has like a $200 million dollar treasury to help people in their community provide labor, and then receive money for it as a job.

Starting point is 00:40:49 All the defy apps with treasuries are trying to pay people to do work for them. The amount of jobs that Ethereum is going to create independently from like these large organizations, these large legacy boomer organizations, sorry boomers, is massive. Ethereum is going to create so many jobs and it's going to be creating jobs in the ways that Andrew Yang has been saying, we need to create jobs like this. We need to figure out how to get people to monetize their own labor and Ethereum does that. David, when we were setting- Andrew Yang, come on the podcast. Okay, well, I was going to say, when we were setting out goals

Starting point is 00:41:23 for 2021, that was one of our goals, to have Andrew Yang on the podcast over, under, on whether that happens this year. What do you think? Oh, it's, Andrew Yang's coming on the podcast in 2021. He's going to figure it out. I trust- David is declaring it. And I think we might be one step. I should go get my Andrew Yang T-shirt. I'm sure he's listening. So I'm sure he's going to email us right after this. Let's talk about more about this news, which is, I think, news in a series of kind of the institutionalization of crypto, but more specifically of defy. So Bitwise has just launched a new DFI fund. It was only last week or maybe the week before we were reporting out on a rollup that Bitwise was starting to incorporate defy assets like Ave and Uniswap in its top 10 index. So Bitwise is like a set protocol. It's like a traditional index that you can buy, almost like an ETF, not quite an ETF, but that you can buy to give you exposure, broad exposure to an asset class of some sort. Now they're launching a

Starting point is 00:42:24 DFI specific fund. Why is this important? It's important because this is how institutions onboard into DFI and Bitwise is giving them a way to gain exposure to another bridge from institutions to our crypto world. David, any other takes on this. Yeah, yeah, it's really important because institutions when they say like, oh, this defy thing is hot, like, how do I get exposure to that? Like, they're not going to go, like, researching individual tokens. They are going to outsource that responsibility to someone else like Bitwise, right? Ryan, I think if you scroll down, it'll show the assets that are coming into the Bitwise top 10. Is that true?

Starting point is 00:43:00 Maybe not. But, like, there are all the ones that you would expect, which is like Uni. Oh, yeah, yeah, yeah. We got to hear it. Uniswap, Avey, Synthetics, Maker, Compound, UMA, Unfinance, ZeroX, LoopRing. Right. That's a great portfolio. That's relatively similar to my bags. So thanks, thanks Bitwise for buying my bags. I'm very happy about that. But yeah, like, I think Bitwise is, it's inside of crypto, but I would still call it quote unquote institutional. And so really what this is

Starting point is 00:43:27 relaying to me is that the rest of crypto that isn't Ethereum native, that isn't really deep in the weeds of Defi are pivoting to start to capture the value of defy because that is the thing that is cool and unique about crypto this cycle. Yeah, we are going to have the chief investment officer Bitwise on the banklist podcast here pretty soon to talk a bit more about that. So stay tuned if you're interested in this story. David, let's talk about support eIP1559.org. This is how governance works in Ethereum and in crypto. Can you talk about this and why this is important and they kind of relate it to governance? Yeah, this support EIP-1559 campaign. is a response to a bunch of miners that are collecting themselves together to do the opposite,

Starting point is 00:44:14 where they're trying to nix EIP-1559, because obviously it's straight up bad for minors. Like there's less minor revenue if EIP-1559 goes in. All those fees that we were talking about earlier that under an EIP-1559 paradigm, that gets burned instead of going to the miners. So miners don't like that. If you want to listen to a really, really good rant, listen to Anthony Sizzano and Eric Conner on their Into the Ether podcast that they did where they talked about this. Like the minority of miners, by the way,

Starting point is 00:44:44 and what's interesting about this is the support side of EIP-1559 is also led by minors. But the anti-EIP-1559 also another, a different set of miners, different pools of miners. Like, honestly, fuck those guys because they are making the most amount of money that they have ever made ever. And they are just trying to say like, no, EIP-1559 is going to like desabilize a thing. we're not going to make any money. Even with EIP 1559, miners are making the most money that they've ever made ever. Like, cry me a river. Like, this is why proof of stake is so important because miners are not aligned with Ethereum as much as ether holders at are. So this website is a website. It's basically an advocacy type website where you can, you know, tweet your support. You click a button,

Starting point is 00:45:30 you tweet your support and just go on record as saying you support EIP 1559. And basically the entire community does support EIP 1559, with a few very small exceptions, except for miners. But let's talk about this because I think this is interesting. What, I guess, weapon, what tool do, what leverage do minors have over the rest of the community? So let's say I'm a minor. I don't want to lose my revenue here and I start saber rattling. What's my threat to the Ethereum community?

Starting point is 00:46:04 What am I going to do if you guys go forward with EIP 1515. Yeah, the minority of miners would be able to fork off their chain. And I guess it would actually, they wouldn't fork where like when EIP 1559 comes in, that's going to be a fork. And so the miners that don't want that are just going to continue on in their own chain. But like good luck convincing the rest of us to go with you, right? This is the power of community consensus. If there's two forks, the community will choose the one that they want to go with. And from what we can tell, EIP 1559 with overwhelming support. Everyone's going to choose the fork with that support. So, you know, go, go fork Ethereum and, like, go play in your, like, non-EIP-1559 playground. Have fun with

Starting point is 00:46:45 your, like, $1.5.5.4. The apps aren't coming there. The community's not coming there. The users aren't coming there. I guess the upside is we might get an extra token out of this that we can go sell. Right? Like, so this is like an Ethereum classic classic type of situation. So they really don't have the leverage here. Yeah, they really don't have the leverage here, which is super interesting. But if you're an eth holder, it's kind of all upside, right? Because you, you basically get, you know, both forks in this types of situation. But this is also an example of how governance works, right? This is kind of the counter forces at play. And ultimately, community consensus is the engine here, is the governance layer, that layer zero, everyone together deciding which fork they're at. And ultimately, community consensus is the engine here, is the governance layer layer zero, everyone together deciding which fork, they are going to download and support is the community. And that's what Ethereum is. It works the same in Bitcoin. And it's a brilliant, I think, mechanism for governance that's as credibly neutral as it can be. Well, I'll actually be push back on that and be the devil's advocate here. So for anyone that wants to call me an eth maximum list, here's my critique of this.

Starting point is 00:47:52 I don't want in the long term any sort of like, I support this fork versus I support this fork because the whole point of Ethereum in the long term is no governance. Right. We were talking earlier about Rye and how it's like a money god because it's autonomous and free from human intervention. This is like, this is, you know, support EIP 1559. That's the same like messages I see when I see like the billboards or the road signs about like in Seattle where I live where like there's political movements about like let's, you know, add in taxes onto Soto or gas. That's not what we want for Ethereum to be. So like the fact that this is even here is a little bit concerning, I don't want Ethereum to be a politically engaging thing. It's supposed to be

Starting point is 00:48:35 autonomous. There isn't supposed to be any sort of like political rallying to try and change the direction of Ethereum. The direction of Ethereum should be the direction of Ethereum, which is autonomous and takes its own course. Again, we are in this early research and development phase of Ethereum, so that's why I'm okay with it. But over the long term, I don't want any sort of this activity at all. Yeah, and I think I would agree with you, right? So the only answer to can we completely neutralize all political decisions, basically, is to solidify your base protocol and don't make any further changes. And at some point, that will happen to Ethereum.

Starting point is 00:49:11 I think actually some point soon in the next three to five years, we'll get all of the core changes we need into Ethereum in the same way that Bitcoin is kind of like codified. It's solid. There are no further changes, although there's probably one coming down the pike once issuance gets to zero and security drops, maybe. Ooh, spicy. A little spicy there. But yeah, I agree with you.

Starting point is 00:49:33 Ultimately, this has to happen with Ethereum. But in the meanwhile, we have this nice kind of fork choice rule that lets the community and social consensus ultimately decide. Anyway, David, let's get to the next news item, which is NBA top shots, man. This thing's heating up. The Dapper Labs community company, actually, behind this is raising $250 million, David, at a $2 billion valuation, I feel like I'm in 2017. Massive. When I saw the telegram ICO here for like billion dollars, is that what we're looking at?

Starting point is 00:50:11 Or like, is there something here? What is this NBA Topshot thing? What is Dapper Labs doing here? Yeah, the numbers are absolutely staggering. A $250 million raise, that's not the valuation. That's how much people, that's literally how much cash people are handing over to Dapper Labs at evaluation of $2 billion. And so Dapper Labs is the team behind Cryptokitties.

Starting point is 00:50:33 And so they were one of the first teams to really experiment with NFTs on chain. And it was so incredibly successful that it clogged the chain back in 2017. It's a famous story. And so this is kind of like the payoff or the reward of being early and figuring out development issues in Ethereum as soon as possible, right? The CryptoKitties craze was absolutely phenomenal. It was massive. And it brought so many people into Ethereum. who, again, don't care about Ethereum.

Starting point is 00:50:58 They only cared about the kitties and how, like, unique they were. And, like, they just came for the kitties. And so Dapper Labs had that experience in 2017. And then they took that information. They put their heads down. They built for two years. And then they landed this NBA Top Shot deal, which is already pulling in millions and millions of dollars of revenue.

Starting point is 00:51:19 Like it's an NFT system with the NBA, right? So NBA plus NFTs. and that's ran by the Dapper Labs team. So congratulations, guys. Like, you guys earned it. Well done. That's a massive raise. Yeah, interestingly enough.

Starting point is 00:51:35 So I think one difference between 2017 is actually they're generating a lot of revenue, right? Like the firm has generated almost 100 million NFT sales, right? So the ICOs of 2017 weren't doing that. The other thing is, it's interesting that NBA TopShots is not built on Ethereum. So it's on this blockchain that Dapper Labs has created. called Flow. And what it kind of reminds me of, what flow kind of reminds me of is it's much less decentralized than that versus Ethereum. It almost reminds me of like a Binance chain for NFTs or like a Coinbase for NFTs type of offering. I think ultimately all of this is

Starting point is 00:52:10 synergistic with what's going on in Defi. But it's interesting to see how this is evolving across chains as well. David, let's get to this exploit, which is our next topic. So, there was an issue with Alpha Finance recently. And it's funny because we've recently had them on for an AMA and asked me anything for the community. Like two days after that, there was an exploit via Alpha Finance. Like $38 million lost, something like that, 37.

Starting point is 00:52:43 37.5 million lost. What can we like take away from this exploit? Yeah, the DeFi Summer cohort, of applications of which Cream is a part of. And even later, Alpha, I believe, are very big fans of integrations, partnerships, building with other apps. And I think that's fantastic.

Starting point is 00:53:05 The unfortunate side effect is that that is a lot of surface area for attack. So that's kind of basically the story here. There was an economic exploit, I believe, that leveraged the Iron Bank, which is this very interesting project, which I'm trying to get some content out of the bankless program on the Iron Bank in the future. And unfortunately, because of the,

Starting point is 00:53:25 composability, they had a weakness that was exploited, sad. Yeah, it's, it's another reminder, and we'll talk about this when it happens, but it's another reminder that, hey, this is the Wild West, this is risky, it's the frontier, be careful what you put into these D5 protocols. I was struck by how, like, talented the Alpha team is, but also, David, when we talk to them about the, like, I was struck by the complexity of the protocol, right? So these protocols are getting more and more complicated and sophisticated, and with that complication comes these sorts of potentials for backdoors and flaws. Like Alpha was audited

Starting point is 00:54:01 out like crazy and this still happened. So, you know, the most powerful risk mitigator of any protocol is what we call the Lindy effect. That is how long it's been going on in the total locked value during its lifespan. The longer it lives without exploit, the longer you can expect it to live in the future. And Alpha is still a relatively new protocol. So I'm not blown away that this happened at all, but we should remember that this kind of thing does happen and can happen in defy and just be careful out there, guys. Another thing to be careful of is volatility. Don't get liquidated.

Starting point is 00:54:40 We saw a little bit of volatility, right, recently. Like these are like little, you know, bear markets dips for ants, I feel like, David. But like this 30% dip that we had, I don't know, in the last week, it's over now. Yeah, it was on Tuesday. Monday and Tuesday. On Tuesday, liquidated a whole bunch of people who had loans taken out of AVE, Curve, Uniswap, DFI. This is the biggest liquidation we've seen in DFI so far, 1.6 billion in total liquidations. That tells me a lot of people are playing with some leverage here in these volatile markets.

Starting point is 00:55:14 Lots of people playing with leverage, which, of course, is arguably the reason why these markets tumble when they do tumble is because people get really bullish. And then they take leverage because they want more exposure. And then things don't go their way. And so they get scared. And so they de-leverage. And what happens when you de-leverage is that you have to sell into the market to cover your position. And since things are already going down, it made you sell, which makes the market price go even down even more, which makes more people sell. And so like we will watch the price of Bitcoin, prices of ether, price of these defy tokens like skyrocket.

Starting point is 00:55:51 And that's a sign of people taking on leverage. and then people will get out over their skis and then things won't go their way and then it'll tumble back the other way. It's not sustainable. So these contractions, these retracements are really, really important for a healthy market. Don't get wrecked, folks. Like, don't take too much leverage. The whole point about this cryptocurrency revolution is that it's a once in a lifetime event. And if you fuck it up because you took leverage, you're an idiot. Like, don't do that. Yeah, like we're going west. This is Oregon Trail. Do not get killed somewhere on the like just stay alive. That's your number one goal in the bankless program. Stay alive to fight another day and leverage.

Starting point is 00:56:27 Man, leverage can kill you. Uniswap has processed over a hundred billion in volume. There's nothing too much to say. We talk about Uniswap all the time. This is an incredible feat. It's a team size of 11 and they did this with a protocol, David. I mean, yeah, team size of 11, but they had Ethereum on their side. Exactly. Right. So like it, what we're really looking at is a like team in kind of their garage. like the early Silicon Valley days that can disrupt entire industries. That's what crypto, that's what Ethereum gives you the power to do. So super exciting. Great milestone. Well done. Hayden Adams. Come on the podcast. Hayden Adams. We know you're listening. Okay. Coinbase powers Tesla, Bitcoin buy. Feels like Coinbase is maybe evangelizing among like the executives in corporate America about crypto and maybe Bitcoin specifically. What's the take on this headline?

Starting point is 00:57:21 Yeah, the big news of last week's roll up was the $1.5 billion purchase of Bitcoin from Tesla. And now we were finding out that they actually got that Bitcoin on Coinbase. So really bullish for the Coinbase IPO, honestly. And I'm sure they took a nice fee out of that. That was probably pretty good for their bottom line. Yeah, Coinbase is going to be one of the biggest IPOs of all time, one of the biggest tech IPOs of all times, like looking at like 80 billion right now,

Starting point is 00:57:48 if you're to believe kind of like futures volume. So that's going to be huge for the industry. Last thing, tell us about the Cryptopunks, NFT movement. Someone bought this Cryptopunk for $600. For $1.2 million, 650, Eath. What's going on here? Yeah, yeah.

Starting point is 00:58:06 So Cryptopunks are kind of one of the OG NFT phenomenon. I'm pretty sure they came back around in 2017, along with Cryptokitties. And so each one has different features, just like CryptoKitties. each one has different desirable, you know, aspects about them. Apparently people really, really value this particular one. It's a, I don't know.

Starting point is 00:58:25 It's a guy in a bandana. Funny thing enough, these things are, I think, 25 by, or 24 by 24 pixels. And I did the math, Ryan. It's 1.1 to ether per pixel is the evaluation on this NFT, which is insane. Wow. Wow.

Starting point is 00:58:42 What a punch per pixel. Maybe the most expensive. per pixel art piece ever sold possibly? I don't know. So I look at this, David, and I don't understand why this is worth 1.2 for billion. But that's okay. Like, million, excuse me, not billion. But like, I'm not in the culture.

Starting point is 00:59:02 Like, again, I don't know if we were to go to Christie's auction house and you're to tell me some painting was worth millions of dollars. I wouldn't know that either. But the market gets to decide the price of these things, which is super interesting. Yep, absolutely crazy. The NFTs are hot. Let's go to takes, David. What takes?

Starting point is 00:59:20 Do you want to start with? Let's start with yours. Let's do it. All right, let me start with us. So I tweeted this out. I said, I found Binance Jan. David, do you remember those AOL CD ROMs?

Starting point is 00:59:29 Used to come out. I was actually too young for these, man. You're too young, all right? I'm like the elder millennial here, right? So I used to get them in our house. We used to play like Frisbee with them. And AOL would just like mass spam everybody, these CDs. And it was kind of like a gateway.

Starting point is 00:59:46 to try AOL and it was really a gateway to the internet. So people are comparing the Binance chain's transactions to Ethereum transactions. And when they do that, part of me gets it, but a huge part of me doesn't because Binance chain is basically, it can't be compared with an open, permissionless, credibly neutral settlement network like Ethereum. It's a separate thing. Binance chain is AOL. It's not the internet, right?

Starting point is 01:00:13 And I think people really need to understand that when you're looking at transactions on something like AOL, you're not looking at transactions on the open internet. These are separate things. So Biden's chain is really like a permissioned walled garden. And that is indeed, I think synergistic with open networks like Ethereum, but they're not the same thing. Like if the internet stopped at AOL, David, like the internet would suck. It was a completely different experience, all kind of curated. applications from AOL and later like Time Warner and it is nothing the same as the open internet. So I guess my message is understand like we're in a bull cycle. So there's all of these narratives flying around. But like understand the fundamentals of these networks are totally different. They are the AOLs out there that claim that they are open and that they're the same thing of the internet. And then there's the true internet networks like Bitcoin and networks like Ethereum that are permissionless open credibly neutral. Those are the things. long term that are going to be important for this industry and for humanity. And the AOLs will just

Starting point is 01:01:18 become like another CD you play, you play Frisbee with. So anyway, that's the hot take here. I love it. I love it. All right. Let's move to yours. Art is priced in Eith, David. Did we already talk about that? Should we talk about that again? A little bit. Yeah, let's talk about it again, though. So Mariano and Eric Connor talking about Mario, Mariano gives like the one fire emoji for the phrase tokens are priced in US dollar and then two fire emojis for tokens or price in ETH, but then three fire emojis for art or price in ETH. We talked about this earlier, of course, and Eric Conner just drives this point home. The future of art will be priced in ETH. The future of art is digital and that digital art will be priced in ETH. That's super cool. Do you think, though,

Starting point is 01:02:01 that what could happen with the arts scene, NFT art scene is that stable, it will start to be priced in stable coins as well? Or do you think like, ETH preserves its unit of account in this world in kind of a different way? Yeah, that's a really good question. Definitely something to pay attention to,

Starting point is 01:02:18 I don't have an answer for you. However, I will say that the NFT mania that's going on is these things being priced higher and higher and higher is going in a correlated fashion to the price of ether. Yeah, it's super fascinating. And everywhere we see NFTs, they're largely, at least right now, denominated in ether. So definitely lends some credibility to that take. David, I want to get to this take.

Starting point is 01:02:38 And this is a picture if you're watching on YouTube. What am I looking at in this first picture here? It looks like, almost like, you know, the brain. It looks like neurons firing here. What is this picture? Yeah, I got this picture. It's from a Wikipedia article, but it's supposed to be some sort of like a networking, infrastructure testing mechanism, right? And it came from my conversation I had with Trent

Starting point is 01:03:05 and Zach Cole from White Block where White Block would try and recreate environments to test networks. They like EOS hire them to test networks and other studios with working in distributed systems would ask them to test their network. And so they would create this like pseudo replication of the internet, right? And this is the picture that we're looking at, right? It's like this branching, forking network of just connections and nodes. And it's supposed to be like a representation of just the way the topological map of the internet. And Will Price tweeted out an image that caught your attention. And I think if, yeah, that's the one.

Starting point is 01:03:44 That's the one. And this is a semantic network of Ethereum. And so this is actually connections as to transactions and calls and things that I'm not a coder. So I'm going to flub all these words. but like all of the transactional data and contracts that people use on Ethereum, it looks the same. It looks the same. It looks the same kind of like structure, same kind of pattern, semantic mapping. It's pretty cool. This is like a superstructure that we see in nature all of the time.

Starting point is 01:04:11 Like if you look at kind of in like deep space at how galaxies are arranged, it's kind of in this like network, like fractal type pattern that we see in, you know, trees and veins and arteries and in, you know, pine cones and snowflakes and all of of these things, this fractal pattern. You wrote this great priest, David, called Ethereum is an emergent structure. And it's funny because this is kind of how emergent structures look, right? Like they're kind of chaotic, kind of unpredictable, but they somehow come together. Chaotic organization. Okay. What is chaotic organization?

Starting point is 01:04:48 Because I think that's important to the take here. Right. It's organization through chaos, right? Like what happens when a bunch of chaos just is allowed to. just be chaotic over time, eventually patterns emerge. Eventually, we get order out of the chaos. And that's what we call defy, right? Like eventually, defy stratifies, it self-organizes, it self-creates, and that's the pattern that we're seeing here. It's an emergent structure. All right, David, let's go with another Michael Saylor type take. He's buying more Bitcoin.

Starting point is 01:05:18 You know what's interesting, too, is he is buying Bitcoin once again with convertible notes. So what's crazy here, David, is debt for everybody is relatively cheap right now, like home mortgage is, if you look at that on kind of the consumer side. But corporate debt is super cheap too because, of course, the Fed sets interest rates. Interest rates are at an all time low. So if you're a big corporation with a decent balance sheet and some cash flows, you can borrow a lot of money. The question is, once you borrow that money, what do you do with it? Michael Saylor is borrowing that money at really low interest rates. like two, three percent, super low interest rates because the money printer is cranking. The money printer's printing. So he's borrowing all this money. More and more of it, it seems. What's he doing with it? He is investing that in crypto in particular.

Starting point is 01:06:08 He's investing that in Bitcoin. He's buying Bitcoin. So he's playing like this money printer arbitrage game where he's like, okay, print the money. It's super cheap. I've got a good balance sheet. I'm just going to take that money. No, I'm not going to plow it back into my business because I couldn't invest $600 million in my micro strategy business and grow my business analytics products.

Starting point is 01:06:30 But I can take that money and I can go and buy Bitcoin with it and that's going to be worth a lot more later. It's crazy, dude. This is corporate arbitrage once again. And it feels like he's found a hack. He's found like some sort of hole in the matrix. Exploit that like the other corporations haven't quite seen yet. And he's front running that.

Starting point is 01:06:51 We're going to see more of this, aren't we, David? What's your take here? Yeah, my take is actually, we forgot to include this in the news section that Michael Saylor and Michael said bought 600. That's because it's old news, dude. It's just not news anymore. This is a lesson in printing, printability versus unprintability, right? Michael Saylor can print as much micro strategy stock as he wants.

Starting point is 01:07:13 And then he can take that and people are giving him dollars, which again are printed. And then he's buying Bitcoin with it, which is unprintable, right? And so this is a lesson in printability versus unprintability. Yeah, it's a fairly smart move. All right, guys, we're going to come back with what we're excited about in the meme of the week. But first, we want to talk a little bit about the sponsors that made this roll up possible. If you are looking for a product that connects your Fiat bank account with defy tokens and products, you need to download the Dharma mobile app. Dharma is a non-custodial smart contract wallet and comes with a bridge that connects you right

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Starting point is 01:08:29 That's dh-r-r-m-a.io. Download the DARBA app and get yourself unbanked today. If you want to live a bankless life, you've got to get yourself a monolith defy visa card. Monolith is a one-two punch. It's both an Ethereum smart contract wallet and a visa card that lets you spend the money you hold in your Ethereum account anywhere Visa is accepted. This is super cool. You can swipe your card at the coffee shop, at the gas station.

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Starting point is 01:09:45 your monolith card that's monolith dot xy z all right david we're back let's get into a it, what are you excited about this week, my friend? Yeah, I am excited about this podcast that I didn't know that we were going to produce until this week when I fell down this little rabbit hole that I went down. And so I'm on a quest to produce this article that's coming out, going to come out on the bank was news that are at some point in time, all about how, like, one of the most underappreciated things about the cryptocurrency industry is our culture, and it's one of our best exports.

Starting point is 01:10:15 The crypto, one of the cryptocurrencies's best exports is our culture. And, yeah, my ideas aren't really completely formulated around this. So I'm going around the ecosystem to talk to people who I know has ideas around this. So I've talked to Amin, I mean Solomani. And then he forwarded me to this guy, Peter Panz, who's a big NFT fan. He's in the Meta Cartel, has his own podcast, Wizard of the Daps. And he wrote this four-part series as the called Before Bitcoin, the history of cryptography and the cyberpunks. And so what I've done is I read every single one of them, except I've recorded myself.

Starting point is 01:10:46 And it's a fantastic story. It's a mind-blowing story. And so we're going to get Peter Pan on the podcast to talk about what. it was like to write that in addition to actually the audio of me reading it. It's a mind-blowing story. I think it's going to be a really unique piece of content. And it just kind of illustrates. My big takeaway was that Bitcoin and Ethereum are just the latest in a multi-decade year-long story of the evolution of cryptography. And so if you think that like Bitcoin just came out of nowhere, it's like, oh, we have Bitcoin now. It's like, no, no. There were three decades of fighting

Starting point is 01:11:19 between these cryptographer cypherpunks and the U.S. government to produce what we can now do today with cryptography. And it's an underappreciated story. It's under told, and I hope we can tell it on the bankless podcast. That sounds super awesome. This movement, we say so often, is a cultural movement. It's a social movement. And when you can get to the roots of where the social movement came from and what the belief structures are that formed it, I think you tend to understand crypto and what we're trying to do here all the better. That sounds awesome, David. I'm excited to dig into that. with you. Ryan, what are you excited about? I'm excited about the movement too. And I feel like the bankless movement, the D-5 movement, is going mainstream. So David, we, we, I got on the Andrew Yang

Starting point is 01:12:02 podcast about a week ago. Yang speaks. So not with Andrew Yang. Not yet. That comes when, hopefully Andrew Yang comes on the podcast. But they were, they reached out to us because they were interested in crypto, basically. They were interested in doing sort of a 101 on crypto. So, we got on Yang Speaks. That's kind of one mainstream type event. We're also getting Mark Cuban to come on the bankless podcast because he's a big deal NFTs. He's really into defy. So he's being scheduled on the podcast. We hit 25K subscribers on the bankless newsletter. So I feel like this defy crypto, this bankless movement is growing. And I'm super excited about the progress we made, my friend. Yeah, absolutely. The bankless is a really scalable meme. People,

Starting point is 01:12:48 People, when I wear my bankless shirt, people like, I don't know what that is, but I like it. And I'm like, you definitely don't know what it is, but I bet you do like it. So I think that the future is bright. All right, David, let's get to the meme of the week. I'm going to share this on my screen. Me of the week. What are we looking at? All right.

Starting point is 01:13:06 So we're looking at the Scooby-Doo guy. I don't know what his name is, actually. Does that make me a boomer? I don't know. The blonde guy from Scooby-Doo. A boomer would know who Scooby-D is. I'm sorry. That's a good point.

Starting point is 01:13:16 Okay, so he's about to pull the mask off on the villain. And the mask on the villain says, on the blockchain, and then the caption is, let's find out who this really is. And then the mask is pulled off. And it's the ether logo and it's actually built on Ethereum. Fun fact, when you see on the blockchain, there's a decent chance that they're actually just talking about Ethereum. Yeah, absolutely. Ethereum definitely underpins a ton of this industry. And I think it's underappreciated as a brand.

Starting point is 01:13:42 So even when I'd like describe kind of what I do, they're like, oh, you're into that. Bitcoin thing. Like Bitcoin is the the Coca-Cola type brand that describes all of the other, all of the other like, you know, soft drinks. And it's interesting that so much of this is actually built on Ethereum, too. So all right, that's the mean of the week. This has been the roll-up. Third week of February, guys. We're almost concluded. Almost the end of February. It's not leapier. Nope. We're almost done February. That's it. Disclamers? Yeah, disclaimers. Keith is risky. Crypto is risky. So is Bitcoin. You could lose what you put in, but we are headed west. This is the frontier. It's not for everyone. But we're glad you're with us on the bankless journey. Thanks a lot.

Bankless - ROLLUP: 3rd Week of February (ETH & BTC ATH's, NFT's, Andrew Yang, Bitwise DeFi Index, Reflexer launches RAI)

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