Bankless - ROLLUP: 4th Week of October

Starting point is 00:00:00 Unstoppable Domains has two products that's helping make the crypto world feel like the old world that we're familiar with, but with these new crypto economic protocols under the hood. And that is human readable crypto addresses as well as uncensurable domains. So I've got my Unstoppable Domains account open here, and I've got my domains registered. And so I've got David Hoffman.compto, right? And I have one of my Ethereum addresses pointed to it. And I'm also going to be able to add my Bitcoin address here as well, because this is a blockchain agnostic product. Any wallet that has unstoppable domains integrated will allow you to type in David Hoffman.compto.

Starting point is 00:00:35 And if you're sending Bitcoin or if you're sending ETH or Lightcoin or Hell, even Ripple, it will send it to the address that I've associated on my accounts. So I'm going to pull up my ether wallet here. And I've loaded up an address with a small amount of ETH. And I'm going to send a little bit of ETH to myself at David Hoffman.compto. It's going to populate with the Ethereum address that it has. But it's also linked to my Twitter account because in Unstoppable Domain, I've linked my Twitter account to all of the addresses that I've plugged in. And so ChainLink is actually associating my Twitter account with my Ethereum address.

Starting point is 00:01:09 And these are the Web 2 platforms that we have today. But think about what happens when decentralized identity becomes more of a thing. I'm sure Unstoppable Domains is going to use decentralized identity solutions like Bright ID or Circles to associate addresses with people in an extremely self-sovereign way. Unstoppable domains also allows you to spin up uncensurable. websites, which is, I think, going to become increasingly important in the world ahead of us. Using Unstoppable Domains, you can purchase a website and use decentralized storage providers to host it as well, meaning that no nation state can take down your website. There is no canceling

Starting point is 00:01:45 in Unstoppable Domains world. They even have templates ready to go to help you build out your first Unstoppable Domain. So go to Unstoppable Domains.com, register your crypto addresses with a human readable name and maybe launch your uncensurable website today. Zapper is this new tool that I use to check out all of my assets in DFI. As you guys have known, DFI has absolutely exploded recently. And so managing your assets is getting harder and harder because there's so many different places and so many different assets that it could be. So I'm going to put my Ethereum address in here. And Zapper is going to tell me where all of my assets are across Ethereum, right? So here are all of the assets in this wallet. There's a decent amount of value.

Starting point is 00:02:27 them. And it's also going to tell me where I've deposited assets into various DFI protocols, right? So there's some yield farming going on. There's some liquidity pooling going on. We can also look more granularly at the specific protocols that it's involved with in this explore feature. So it's got some assets deposited into Uniswap. It's got some assets deposited into Balancer. And also with Zapper, you can just exchange straight from the Zapper interface, right? So this is just another layer on top of uniswap or other exchanges on Ethereum that allow you to swap assets, right? So check them out at zapper.fi. It'll give you a nice clean portal to invest your assets in defy. And you can also connect multiple wallets if you use multiple wallets all at once. And it'll give you an aggregate of every

Starting point is 00:03:11 single wallet that you own. Check them out at zapper.fi. Also, this is definitely not my wallet. Hello, Bankless Nation. Welcome to another episode of weekly roll-ups. This is the fourth episode, the fourth week of October. And this is kind of a new episode format for David and I. What we do is we bring this to you on Friday morning so you can have a weekly roll-up of everything that's going on in crypto with your morning coffee. You can either view it on YouTube, watch us there,

Starting point is 00:03:49 or you can also get this on the podcast. What we do is every single Friday. We cover five topics in five minutes, and we get everything that is relevant. everything that is happening in crypto in your ears. We cover the market. We cover releases. We cover news, hot takes. And finally, we end with things that we are personally excited about that have happened this week. David, how's your week going, man? Really, really good. And I hope people listening on this Friday morning are as engaged and energetic as we are about to be in this weekly

Starting point is 00:04:24 roll-ups. It's a fast-paced way to inject a bunch of information right into your brain. So let's go head and get started. All right, man. Well, let's start with what are the market saying? And do you want to start with Bitcoin as we usually do? Yeah, Bitcoin is saying that he's happy. Yeah, Bitcoin's pretty happy with what's going on right now. It seems to be kind of dominating the new cycle, dominating the market action. And if you go to coinmarketcap.com, you kind of see that Bitcoin is going up and to the right and everything is flat at best and down and everything else is kind of down. So it's a Bitcoin dominated news cycle this week. And why is that, David? Has any catalyst happening? Or do you think this has just been a slow build? And look, Defi and other

Starting point is 00:05:07 like Ethereum-based coins have had sort of their time to shine and now it's Bitcoin's turn. Yeah, Sazel, Anthony Sazano had a really good piece in his daily way where he talks about like the pendulum, pendulum shift, right? Like it was defy summer and now it's Bitcoin fall. And that kind of seems to be the narrative that seems to be playing out. People, like we've been saying on the bank list program, people have really come to understand what Bitcoin is, not just inside crypto, but outside of crypto. And, you know, understanding Bitcoin is bullish for Bitcoin. And people seem to be figuring out what Bitcoin is supposed to do inside of their portfolio. And that trend just continues to iterate. And that's what we see going on in the markets today.

Starting point is 00:05:49 Okay, so Bitcoin is as we're recording this at above 1,300, do you think it stays there and do you think it goes higher in the weeks to come? Yeah, I think it's very likely that we are kind of seeing the last of the low tens for Bitcoin. We could, maybe we could hang here and go flat for another quarter, but people are looking to buy the dip. There's a lot of hype. Dips are getting by. So, you know, it's worth noting that Bitcoin has only spent five. weeks of its life above its current price point. So, you know, if you take a moving average perspective, Bitcoin is more or less at its all-time high. All right, five-digit Bitcoin from here on out. David's

Starting point is 00:06:31 predicting that. Oh, let's talk about ETH price. Okay, so ETH has taken a bit of a hit within the last week or so, but it's hanging in there, $3.90. What's your take on ETH price? Yeah, ETH price seems to be splitting the difference between Bitcoin and DFI. And we're going to get into DFI in a little bit. DFI is not doing so well. is not doing so well, but eth prices is definitely doing well. A lot, eth price is up against a lot of Ethereum-based tokens, right? And I think what we're seeing is a bunch of different variables. I think investors understand that ether is extremely liquid and shares some of the same characteristics that Bitcoin does,

Starting point is 00:07:08 right? Like a non-sovereign store of value permissionlessly available throughout the world that's extremely liquid, right? Unlike all the defy tokens on Ethereum, which are relatively ill-liquid, Ethereum really does. does split that difference really well between Bitcoin and Defi. And so I feel like we are seeing some investor dissonance as to like, you know, is Ether a DeFi token or is Ether like Bitcoin? And the market says it's kind of right in the middle. Yeah, and that feels about right to me.

Starting point is 00:07:35 It is right in the middle. But it is the only other asset besides Bitcoin that can get the type of institutional adoption this cycle that I think Bitcoin will get. It is the only CFTC designated commodity along with Bitcoin after all. lots of promise for Ethereum, and I think we're seeing that in the ETH price. Do you want to talk about, I guess, YFI real quick? Like that was sort of a hallmark of Defi, the Defi summer, and now it has landed back to Earth. This goes back to kind of the pendulum shift. You almost have to expect this after such a stellar rise where Wi-Fi came out of nowhere. And I feel like this is one of the

Starting point is 00:08:15 assets that we'll remember as kind of 2020 summer of defy 2020 but what's happening to it now yeah so you know why if i like we like we talked about on the bank list program technically it started at zero it really got on people's radar maybe at one to three thousand and then it you know kind of zoomed all the way up to 40 000 and now it's down to 11 000 right and so you know it being at 11 000 it is technically still people have made a lot of money but only if you got in really early right 80 36% of addresses that have purchased YFI, purchase it at a higher price than it is today. And so I kind of think that, like,

Starting point is 00:08:54 defy is kind of where Ethereum was at the end of 2018, kind of going into this bear market. That's going to be a little bit longer than people thought that it was going to. And we're seeing this with other defy tokens like uni as well. This is really where, like, we talked about this theme on the banquet's podcast with our defy founder series and our defy protocols. You know, things happen in bear markets, right?

Starting point is 00:09:19 And I think this is where, you know, Wi-Fi and Uni and the community around these tokens really harden up. Like the true believers are going to stick around and the people that were here for the gains are going to defect and sell. All right. Last thing. We should talk for a minute about this chart. This is a phenomenally crazy chart. It looks like Mount Everest over here. This is the amount of Bitcoin on Ethereum right now as measured in Bitcoin.

Starting point is 00:09:45 And it is from about April 2020 to up till now. It's like straight up. There's now $2 billion worth of Bitcoin on Ethereum right now. Are we seeing sort of the ether Ethereum as a black hole meme? Is that what's happening? It's just sucking in assets like Bitcoin. Absolutely. Ethereum is a nexus of economic activity.

Starting point is 00:10:11 That's what Anthony Sizzano calls it. And I really like that metaphor. things just, it's a settlement layer for everything, including Bitcoin, right? And I'm a really big bull on Bitcoin on Ethereum. I think the market cap of Bitcoin will ultimately be higher because of what it can do on Ethereum, what Ethereum unlocks for it. So it's just rational to put all of your Bitcoin on Ethereum. I think that over time, the majority of Bitcoin will come to be on Ethereum. We're at 150,000 Bitcoins on Ethereum. And to put that into context, like micro strategy, the company that all the bitcoins are really stoked about putting BTC

Starting point is 00:10:49 on their balance sheet, they bought 50,000 Bitcoins, right? Ethereum has 150,000 and growing every single day. Ethereum's the largest buyer of Bitcoin ever by like a long shot. Yeah, that's a really interesting way to put it. Ethereum is the largest buyer of Bitcoin by a long shot ever. Very fascinating. All right, we're done with markets, David. We've got to get to what got released last week. Do you want to start with AVE? Yeah, this has been a long time coming, and this is something that we talked about with Stani on the AVEA podcast. AVE is finally turning over the keys to the AVE kingdom to token holders.

Starting point is 00:11:26 So the AVE token holders now have governance over the protocol. So really big step into maturity and development for Avey. So tip of the hat to Stani and the Avey team for getting to this point. Yeah, I mean, it starts to give actual governance rights over to token holders. That's long been a criticism of some of these D5 protocols that the tokens actually don't come with governance rights, the ability to control the underlying smart contracts. Well, here they do. Avey takes a major step towards that. That's quite fascinating.

Starting point is 00:11:57 Also, Coinbase is making some moves. Coinbase is sort of a giant. We call them probably a crypto bank, David, but they're releasing a debit card to U.S. customers. I mean, you know, Capital Ones of the world, the city groups. the chases of the world. These are banks that released debit cards and have active like credit card debit card functions. And now here's a crypto bank coming from the crypto side and getting into their world a little bit. What's your take on this? Yeah, this is a great example of how the world of crypto exchanges and banks are coming together to be the same thing. Like banks are like

Starting point is 00:12:37 the natural precursor to a crypto exchange and crypto exchange are a natural precursor to a crypto bank. and now these things are melding together. Coinbase issuing a Visa debit card that has your crypto assets backing it in Coinbase is a really interesting product. I'm interested to see the product market fit that comes out of this or not. We do know that people tend to be hesitant about spending their crypto. But for some people that like to denominate their wealth in crypto and only spend what they need, this is a really good tool.

Starting point is 00:13:08 Yeah, it's definitely an interesting product. And get ready, I would say make ready for the, Coinbase IPO that is inevitably coming. I feel like that is a virtual certainty. And products like this kind of are along the roadmap towards that, I bet. Speaking of banks in general, J.P. Morgan, they created an entire unit for blockchain projects. They have a well-known internal initiative that is building basically an Ethereum private chain and a internal staple coin called J.P. Morgan coin, actually, that they're using for transaction settlement. That's the purported use case.

Starting point is 00:13:43 We've got about 100 folks in this blockchain Ethereum-centric division. What's your take on that? Yeah, if I remember, J.P. Morgan and its private Ethereum, it's an Ethereum fork that it kind of manages itself called the forum. Yes. The instigation of this. So this has actually been a project for a while. I remember them being at East Denver in 2018. So this is not something that just randomly popped up.

Starting point is 00:14:09 This has been in the works for a while. So J.P. Morgan has had stake in crypto and specifically in Ethereum for a long time. I'm pretty sure they're working closely with consensus on this as well. Consensus, I think, purchased quorum from J.P. Morgan, which was always an interesting choice. But J.P. Morgan is not soft on Ethereum. J.P. Morgan's very hard on Ethereum. Yeah, definitely very hard on Ethereum. All right. So also, we've got the largest bank in Singapore that just added a crypto exchange to you. I think that goes along with a theme. So just last week, largest crypto bank called DBS, adding a crypto exchange, JPMorgan, you know,

Starting point is 00:14:47 populating, advertising, their JPMorgan coin on Ethereum. This is coming from the other direction, right? We've got Coinbase becoming more like a traditional bank. Now we have traditional banks trying to become a bit more like a coinbase and there's got to be some convergence in the middle. Fascinating stuff. David, we probably have time to talk about one more release. Do you want to talk about Audius? Yeah, Audius is a project. that is trying to be a decentralized storage force, like a SoundCloud alternative. You know, SoundCloud was the place to be if you are an artist who wants to remix other people's music, but sometimes that comes with copyright infringement. So Audius is kind of this new sound cloud

Starting point is 00:15:27 where you can take a famous artist's music, remix it, and upload it to Audius. And it's not nation-state level resistant like Ethereum, but it does have corporate level resistance. And so I think I think there's like 90 or 100 nodes that are supporting the Audius system. And that's what Audius is all about. And so I'm interested to see the experimentation with different levels of decentralization needed to produce a product. Yeah, for sure. We also, I lied, we have one last release that we've got to talk about.

Starting point is 00:15:56 This is FTX, the crypto derivatives exchange platform. It has just announced that it has launched a new way to trade stocks. So you can actually get Apple price exposure or Google price exposure in FTX. You know, Bitmex famously did derivatives, mainly on crypto projects. Now this is moving derivatives over to derivative synthetic stocks. What's your take there? Yeah, this is really interesting, especially when it comes hot on the heels of the Bitmex, you know, attack from regulators, right?

Starting point is 00:16:34 Like this is not a regulated product. And Sam Bankman-Fried, the guy behind FTCs, is a U.S. citizen, I'm pretty sure. And so this is a really bold move because this is definitely against CFTC regulations. And also I'm pretty sure the same Bank Secrecy Act that applied to BitMix also applies to FDX. So, you know, Sam Bankman-Fried and FTCS are really throwing caution to the win and taking a really bold move with offering this. Yeah, is this kind of an icarus flying too close to the sun, you think? I think so. a little too bold or do they have really good lawyers and really good advice? I mean, they are blocking

Starting point is 00:17:08 traders from the U.S. and other restricted jurisdictions, but that certainly did not, right, that did not help Bitmex in the charges that the DOJ brought. So we'll have to see what happens there. All right, David, we've got to get to our next section, five minutes. What's in the news lately? Do you want to start with another crypto bank? I feel like this is the week of like crypto banks, right? So a few weeks ago, we saw that Cracken actually applied and became the second regulated bank. This is a traditional bank. There's a designation for that under the state of Wyoming. It was a bank charter, basically.

Starting point is 00:17:46 And now a startup bank called Avanté has become the second to receive this bank charter designation in the state of Wyoming. Wyoming really turning into this almost U.S.-based cryptocurrency. friendly jurisdiction, right? Citadel of Wyoming. Citadel, right? Caitlin Long, others I think have gotten very active in legislation in Wyoming and turn legislators into sort of a crypto-friendly state. So what's your take on this?

Starting point is 00:18:15 Is this just more of the theme we've been talking about? And here's crypto now becoming more bank-like. And now instead of a meme, it's like literally crypto bank charter, not just crypto bank charter, not just crypto bank charter. Yeah, absolutely. There's a number of different takes to be had here. One, it's really cool to see another bank follow in the footsteps after Cracken, right? And so, like, you know, I didn't expect this to happen so soon.

Starting point is 00:18:39 Turns out there's a ton of demand for a service like this. So tip of the hat to Cracken for really pushing the fold and allowing people to follow in the footsteps. Another take is that this is just about the professionalization and institutionalization of crypto. This is how we make crypto more appealing to people that have bigger bank roles, right? And I think, yeah, I think those are the big two takes. Yeah, it's funny. Any one of these stories, I think if this was bull market territory fully in 2017, would have, like, absolutely blown up in, like, price, that sort of thing.

Starting point is 00:19:13 We're not seeing that yet. We're still seeing kind of these news stories come in, but stay under the radar. I wonder how long that lasts. These are super real fundamental, folks. They are. Here's another, I think, real fundamental, but also interesting. We've been talking a little bit about Microsoft. strategy putting Bitcoin on their balance sheet. But it seems to be a way to actually pump performance

Starting point is 00:19:36 of their stock. Because micro strategy, since purchasing, it's looking like a really smart hedge fund because since purchasing Bitcoin, they're already up $100 million from that investment. What's your take? Yeah. Importantly, micro strategy earned $78 million from its core businesses over the last 3.5 years, and it's also earned a $100 million based on its Bitcoin trade that's made in the last like three months. And also the stock price has also gone up. And so what I have my eye on is perhaps like this inevitable fomo where, you know, company X puts X number of Bitcoins on its balance sheet and then Bitcoin goes up and then company X's stock price goes up. If that continues to happen, that's going to trigger just a viral feedback loop where

Starting point is 00:20:24 other companies would be like, well, everyone else is putting Bitcoin on their balance sheet, and then their stock price goes up. So like now we have to do it too. There's a potential for a viral FOMO feedback loop there. And it is funny because you really get the sense that like high net worth individuals, companies publicly traded companies themselves, they don't know where to put their money. They're like, where do we put our money? We have all of this money. The Fed keeps printing. We have a lot of it. And so they're putting it in places like crypto. Fascinating. I didn't get caught up on this Iran news, David. So what's that? I think there's been some Iran news that came out about Bitcoin for import payments. Yeah, yeah. So Iran is allowing for imports to be paid with cryptocurrency,

Starting point is 00:21:06 right? And so this is one part a strategy to get around sanctions. United States and all of our allies have put really heavy sanctions on Iran and how they can pay for things because the United States controls the dollar system, the, you know, the international finance. system. But with Bitcoin, Iran has a way to pay for things, right? And so it turns out like what's really interesting about this is it's alluding to that this is kind of just like the tip of the iceberg with Iran's relationship to Bitcoin. It's highly likely that Iran has at least been trying to accumulate Bitcoin for its own purposes to pay for things because that's the only way that it can pay for things. And now it's greenlighting paying for imports

Starting point is 00:21:50 with Bitcoin, right? And so this is just how, for better or for worse, Bitcoin is a tool of financial freedom for not just individuals, but also for countries. Yeah, I wonder if there's going to be some blowback, though, from the, you know, the major countries of the world that are sort of the, you know, policing Iran's activity, right? It's like, not the best representative. Right. Bitcoin is for criminals and for renegade government. Like, you can almost hear legislators in Congress making that argument. That's exactly right. All right, David, there, are brought to you by WIRN. WIRN is DFI's first self-building community-run project,

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Starting point is 00:22:49 DeFi. For those who want to just earn yield on their stable coins, the earn system is for you, where you can deposit your preferred stable coin, and Y-Earn will go and figure out which money market on D-Fi and D-Fi is producing the best interest rate, whether it's D-Y-D-X, it's compound or AVE. It looks around D-Fi to see where the yield is coming from, and it directs stable coins automatically so you don't have to. Check them out at y-earn.finance to get started, and also check out the stats page to see what other people are doing as well. We're also brought to you, by Monolith. Monolith is your cool new Defi account, your Defi savings account, your defy checking account, except the cool thing about the Monolith Defi account is that it gets

Starting point is 00:23:29 software updates, right? You actually get to increase the usefulness of this over time. So here are some of the features. Monolith is a smart contract wallet with a lot of the features that you would expect if you've come to know Defi and what it is, you can add money to it. You can put that money to work in compound and accessing yield. But you can also, and you can also, you can also swap through uniswap. What was cool with Monolith is that they will send you a very sexily Monolith Visa card that connects to your Smart Monolith smart contract wallet on Ethereum. So it's a really awesome tool to live a bankless life with a savings account that gets software updates. So this is something that you're never going to find out in the real world,

Starting point is 00:24:10 but you can still do real world things with real money, like buy your groceries. So that's just fantastic. Coming soon to Monolith, actually already here to Monolith, is now you can buy, die, and get it sent to your wallet directly, right? So it's also being an on-ramp. So you don't have to go through your centralized exchange, like Coinbase or Gemini or wherever. You can just go straight from your bank account right into your monolith checking account smart contract wallet. So check them out at monolith. All right, David, a number of other things happened this week.

Starting point is 00:24:42 I don't know if you want to pick out one or two. Flash loans are starting to make some governance decisions in Maker. That's an interesting development. We will include a link to that, certainly. I guess along the lines of our banks becoming more like crypto banks and this convergence, consensus is also helping a few central bank digital currencies start up. One from a bank of Thailand. This is a pilot project.

Starting point is 00:25:10 Another, a French bank. Do you have a take on that? Yeah, this is just kind of the theme lately. like the adjacent topics around cryptocurrency are really coming into the fold central bank digital currencies is a very hot subject right now and people are just kind of more or less assuming that almost all central banks are going to do one of these and so the the french central bank and also the in thailand central bank has also interestingly been working with consensus the ethereum startup studio to produce central bank digital currencies and so it seems to be that the world of central bank digital currencies are ahead of us, and consensus is really helping handhold central banks along

Starting point is 00:25:53 to get this job done. Yeah, I think the only question is how long it takes. It's now it seems inevitable, and the question then becomes how long does this take for central banks to execute? It seems like it is heading in that direction at this point. All right, David, let's move to some hot takes. Tell me what's on your mind. What have you been thinking about this past week as these releases and these news events and kind of the market activity have unfolded. Yeah, well, one thing that's been on my mind lately is at least on crypto Twitter, and maybe that's not the most reflective place, but it's a place where I spend a decent amount of my time is that the fight between Bitcoin versus Ethereum or Bitcoin and Ethereum.

Starting point is 00:26:32 Now, I'm firmly in the Bitcoin and Ethereum camp, however, I will sometimes put on my Ethereum Maximilus hat and poke fun at Bitcoiners. But like I said earlier, I truly believe that the combination, of Bitcoin and Ethereum are mutually beneficial for both protocols. And one of the things that we're seeing happen is $2 billion worth of Bitcoin on Ethereum like we talked about. So that's kind of what I've been chewing on. And every time I see the Ethereum and Bitcoin blockchain become closer, I get happier. Yeah. Well, how many Bitcoiners would you say, do you think are on that train of thought, David? Do you think that like has there's been so much vitriol pointed at

Starting point is 00:27:11 Ethereum over the years from the Maximus community, but also elements of the more mainstream Bitcoin community. Are they happy about this, all the Bitcoin on Ethereum? Are they saying, ha ha, got you. Ethereum is a side chain of Bitcoin after all? Or are they upset that, you know, Ethereum is kind of taking all of this mine share and this asset value? Yeah, yeah, it's a really good perspective. And some people don't like it, some Bitcoiners don't like it at all. Other Bitcoiners, like my co-host on POV CryptoCK, he sees Bitcoin on Ethereum as proof of Bitcoin's narrative. And he also says that, well, Ethereum, along with many other blockchains, also have to compete for Bitcoin, right? And so he puts the ball in Bitcoin's court saying, you know, Ethereum is

Starting point is 00:27:55 competing along with everyone else in the world for their Bitcoins. I'm on the side where Ethereum is the world's best transactional layer. And so Bitcoin is finding its way onto Ethereum for that reason. But these reasons are not mutually exclusive. And there are are a few bit-coiners, I would say like Nick Carter and Eric Voorhees, who are very much in the This is Good for Both Camp and some others who just don't really care about Ethereum that will put up the blinders and not really pay attention. Yeah, very good. I'm probably in the this is good for both camp myself. However, I will say to leave this off, every single Bitcoin on Ethereum pays fees to Ethereum. And those fees go to security of the economic network.

Starting point is 00:28:34 Yes, that's right. Absolutely. All right, Ryan, what are you, Stokey? about what's on your mind um i you know i guess a couple things one thing that just popped up today david i was actually trying to uh move our a PayPal account from one business entity to another just like a a tax ID number a difference for bankless i went to PayPal and i contacted a rep because that's of course what you have to do everything goes through large office spaces and you know who knows where and centralized intermediaries um and the response came back of course like two three days later, please fax or mail the information. Facts? Facts? Yes, facts. Or alternatively, I can mail information. What I have to do is mail a

Starting point is 00:29:19 physical copy of my driver's license, a physical copy of a business license from the IRS stating a tax ID number. I have to either fax those, which is like I don't even know how to, like, how do I use, I don't know how to use a fax. Where's the nearest facts to you? Right. So I'm just mailing it. And once I mail it, some department somewhere receives it. And then they process it. And hopefully some weeks later, I hear back. My thought is just like people complain, people talk about crypto having bad UX. No. No, crypto does not have bad UX. It has different UX. This is bad UX. Like, you should not have to fax information to a centralized intermediary filled with office parks full of people doing like jobs that quite honestly could be automated away in order to get something done like this. And it's just evidence to me. And like it makes me more and more bullish on Ethereum, more and more bullish defy, more and more bullish bankless. Because now that you've unlocked this world, once you go bankless, like you don't go back.

Starting point is 00:30:29 Like the banking UX sucks. Go try to wire money. Like I had to, you have to go to your local bank branch, talk to them in person, actually pay a fee to get funds from one place to another within 48 hours, maybe. Yeah. It's absurd.

Starting point is 00:30:43 It's crazy. Yeah. So one take is there. You know, I've got a second take too for you. Hit me. This is maybe a little more spicy to you. All right. Masari put out a really fascinating graphic.

Starting point is 00:30:56 I want you guys to look at this. If you're looking on YouTube, of this graphic. And this is basically a graphic of the distribution that various so-called eth-killers have other smart contract platforms that are competing with Ethereum. And if you look at the blue section there, that is tokens only available in pre-sale to insiders, accredited investors. If you look at the pink section in these eth-killer platforms, those are tokens that are allocated to foundations. Now, the interesting thing about these foundations is the foundations are mostly controlled by the owners of the tokens themselves. So it's effectively an insider's game too, especially when

Starting point is 00:31:39 you introduce things like on-chain governance, where the coin vote holders get to essentially vote where the funds go, like back or forth. So anyway, looking at the distribution of this, and you look at a Salana, for instance, that is well, like close to 70%, owned by insiders, right? Like no public sale at all. Maybe some scraps, breadcrumbs for community allocation, whatever that means, however you get that. Sellow, Flow, Avalanche, Blockstack, they're all the same.

Starting point is 00:32:12 I think that the distribution of these tokens, these so-called Eve killers, basically means that they're toothless. Like they don't have the ability to kill an Ethereum with a more credibly neutral distribution. policy. We've talked about in the past Bitcoin's immaculate proof of work conception, how that can't be repeated. Well, Ethereum has an immaculate ICO inception. Very hard to repeat that. It was not accredited investor insiders only. You know, distribution to like developers when you add proof of work ends up being like 10% of the network value. And I do think that is an underrated

Starting point is 00:32:49 element of Ethereum. And one reason why Heath Killers will never catch up. What do you think? about that. I actually have a spicy take to your spicy take. All right. And you're absolutely right. There's not one thing that I disagree about. If you want to have a global decentralized infrastructure, you need mass distribution and mass community ownership, which is what Bitcoin and Ethereum have. I think that you are layering the perspective of wanting to be that upon these other alternatives. But I think these guys are actually more going for a traditional business. business model route where yeah, this is a blockchain that is going to be loosely decentralized, but not mega decentralized. And it's really just going to provide a service using an alternative

Starting point is 00:33:36 substrate. And this is kind of just kind of being not going to be a centralized company, but it's not really going to be decentralized either. And so it's kind of splitting the difference between our old legacy business models and these new decentralized platforms like Bitcoin and Ethereum and saying, yeah, we're going to maintain a decent amount of centralization. And we're just going to provide one service really, really well. And I think that's kind of where these people are going to be forced to be because they actually have no alternative because of exactly how you said. Yeah, I kind of agree with that too. And what it does, though, is I think it probably removes them from playing the, their asset is money game. The game that Bitcoin and Ether are playing right now.

Starting point is 00:34:15 That's exactly right. Which is a huge loss. A huge loss from a security perspective. The money game is is where you get core security. At least that's sort of the, you know, our thesis. It's where you get number go up too. Yes, very important to have that. All right, let's talk about lastly, David, we're getting close on time, but what are you excited about? Yeah, I'm really excited about this tactic

Starting point is 00:34:37 that we put out yesterday on the bankless newsletter, all about Balancer Smart Pools. As a too long didn't read, Balancer, before now, had two versions of pools, public pools and private pools. And public pools had all of, the balancer pool parameters fixed. So there are six different parameters that you can adjust that make up a balancer pool. And then private pools have all six of these unlocked.

Starting point is 00:34:59 But having a private pool is like not really good for people who want to provide liquidity to those pools because whoever built the pool can rugpole basically in six different ways, right? And so balancer just released out smart pools, which allows us to find a middle ground between having flexibility of parameters, but also maintaining trustlessness, right? And so we put out in a protocol that used a balancer smart pool to issue a token is the perp protocol. And it did something called a liquidity bootstrapping pool.

Starting point is 00:35:31 And what that pool did is that it started, it started two tokens, their perp token, which is kind of like their ICO issuance token and dye. And it started with die at a low weight and their perp token at a high weight. And then over a three day long period, those weights adjusted. right? And so die would become weighted more and more and more. Perp would be weighted less and less and less. And this creates a Dutch auction. For those that aren't familiar, a Dutch auction is like a normal auction, but in reverse. The token price starts high and then moves and trends towards zero. The assumption is that at some point before the token actually gets to zero, the market buys all of it up, right? And so I think this is actually going to be a huge money Lego for teams that are interested in issuing a token in this way. It's got some massive advantages. You can't run front run it. You can't bought it. It's liquid from day one. There's no privileged access.

Starting point is 00:36:24 It's not like yield farming where people that have a lot of capital are able to yield farm it more than people that don't. I think it's one of the fairest distribution methods we've ever come up with on Ethereum. So tip of the hat to Balancer for getting this Balancer smart pool up and running. Much fair distribution. Even Borat approves, as you can see in the post. And that's a nice shirt you got there, David. Does that have anything to do with the Balancer Smart Pool? Perhaps a little bit.

Starting point is 00:36:49 So you guys remember the BAP Zero tokens, which have these fantastic shirts, if you're watching on YouTube. The ETHscape. The ETHscape shirts. Yeah. And so we initially sold these tokens on Uniswap. We put 50 tokens into Uniswap paired with 50 ETH. And then people bought them, except people bought 16 of them.

Starting point is 00:37:09 And then the price just got way too high, right? I think the price got up to like $12 or $1,600. And then we couldn't sell the remaining of the 34 tokens. Like, we ran into a dead end. And so what we're doing is we're migrating those 34 tokens into a balancer smart pool. We started the starting price at the highest price that a shirt was sold for. And over the next month, the price is going to trend towards zero. Fun fact, Ryan, I actually did the math.

Starting point is 00:37:33 The last day of the sale is Thanksgiving. Fun fact. Oh, no kidding. That's the last day. And at that point in time, if there's tokens left, you can get the shirts for like something that approaches zero. It depends on the demand of this thing, right? Right.

Starting point is 00:37:45 Yeah. So we put these 34 tokens into Balancer and the starting price was at roughly $1,200, but then someone bought one and now the price is $1,300. So it still does that uniswap thing where the more buyers there are, the price goes up. But the difference is over time, the weights of the die versus BAP zero token change. And so the price will go down over time. So it's a little bit of a game between you and the other participants. It's how long are you going to wait for the price to come down before?

Starting point is 00:38:15 you purchase. If you wait too long, they might get all bought. And if you wait, if you don't wait long enough, you might have paid too high of a price. Right. A little bit of a game to play. Yeah, just like auctions are a game in real life. This is super fascinating. We'll have to see how this experiment plays out. It's, it's going to be super fun. That's for sure. David, you know, one thing that I'm excited about, of course, is, you know, bank ledgers, everything they're doing in Ethereum, but we talked a lot about that. I want to ask you, like, just maybe in closing, how are you feeling about the election. I know you've talked a lot about, and both of us have talked a lot about the election being sort of a major macro event that happens with crypto. What's your take on it now? I mean, we're just days

Starting point is 00:38:58 out of the U.S. presidential election. Yeah, the U.S. presidential election seems to be a big fork in the road where a bunch of different things could happen, right? Donald Trump has signal that he might be interested in contesting the election, which would be bad. That's bad for stability. there's also a cohort of Trump supporters that, you know, might cause civil unrest, which would also be bad. If I could think of the way that is the best for my bags, I would think that Joe Biden would peacefully get elected and then start printing a bunch of money. I think if you are a Bitcoin bagholder, that's kind of where you want to what you want to see happen. But I'm really excited about just getting this thing behind us. I just want it over with.

Starting point is 00:39:43 It's exhausting. Are you exhausted? I'm exhausted about it. You know, COVID, COVID is spiking through the roof again. That's also, you know, a lot of uncertainty there. I want less uncertainty. And so I'm ready to get this election just behind us and in the rearview mirror. Less uncertainty, less noise, more getting back to like what's kind of really important.

Starting point is 00:40:03 More like moving forward sounds really good. And hopefully post-election, we have a bit more of that. All right, David, we are at time, but we talk to market. We talked releases. we talk news, some hot takes, and thanks for letting us know and letting me know what you are excited about. Guys, this has been our weekly roll-up every Friday. They're coming at you. Enjoy it with your morning coffee. It'll be out first thing in the morning. No matter where you live, you can get caught up on the crypto news. This has been Ryan and David from the Bankless Nation. Thanks a lot.

Starting point is 00:40:41 Cheers.

Bankless - ROLLUP: 4th Week of October

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