Bankless - ROLLUP: 5th Week of April (ETH All Time High, Eminem NFT, Tesla Sells BTC, JP Morgan Crypto Fund)

Starting point is 00:00:01 Bankless Nation, it is the fifth week of April, and this is your weekly roll-up. David, you ready to roll them up? Let's do it, Ryan. It's another fantastic week in the world of crypto, and so we are going to inject all of that fantasticness right into your brain on this bankless weekly roll-up. So the agenda, as always, is market releases, news, takes what we're both excited about, and then we end with the meme of the week. might have a special runner-up bonus meme this week. So stick around to the end for that.

Starting point is 00:00:46 David, we've got this going on every Friday morning so folks can enjoy this with their morning coffee either on YouTube. So you get to see the visuals that accompany the roll-up or on the podcast, however you prefer to consume content, we've got it for you. Before we get into the roll-up, David, we've got some announcements. Dude, we are giving away one ETH today. A whole ether. Like for real. What? Yeah. This is not a scam. This is not a scam. This is not a not like Vitalik, like fake Vitalik on Twitter offering to give you one ETH. This is actually bankless giving you one ETH if you are a bankless badge holder and not everyone gets this. I should say. This is a raffle. Only one winner. Only one ETH is being given away to one

Starting point is 00:01:27 lucky raffle winner who by default has a bankless badge and submitted their bankless badge to the raffle so that they could get entered to win that one ether. Only giving away one. Much much better explanation, David. So what is the value of one-eath as we speak, David? I didn't get your chart up. Yeah, the value of one-eath is exactly $2,726 in 91 cents. And so that is how much money we are giving away, one-eather, really. One-Eath is one-Eth.

Starting point is 00:01:58 And it's going to a bankless badge holder. Yep. So we're doing this because we want people who are premium members who have the ability to claim their badge, to claim their badge, to claim their bankless badge. Once again, if you're a premium member and you subscribe before April 1st, you should have an email in your inbox

Starting point is 00:02:16 with a way to mint your badge. Make sure you do that. Enter the raffle. If you subscribe during the month of April, you will get your badge on May 1st. So that is actually tomorrow from the time people read this. So April bachelors,

Starting point is 00:02:28 the minting is happening on Saturday. David, we should also talk about Dharma. Dharma is doing big things in this space. are they doing? Darma is onboarding all of the retail people that we think are coming into the realm of specifically Ethereum rather than just crypto. I think Dharma will be onboarding all of those groups of people. And I think retail season is pretty close. And I actually think retail season begins right after Ether finally slows down, if it ever does slow down, because then some of that value will rotate into defy tokens. And we all know retail loves to speculate on tokens,

Starting point is 00:03:06 specifically defy tokens. And Dharma is that one-tap access between your bank account and defy tokens on uniswap. So you can immediately go from dollar, you know, shit-coin dollars in your bank account to a capital asset appreciating defy tokens on Ethereum. The fastest bridge between your bank account and Ethereum. Dollars to defy in one tap. I was looking at the interest rates for my Wells Fargo savings account, David, 0.01% in a savings account in Wells Fargo.

Starting point is 00:03:35 Just say zero. Just say zero, Wells Fargo. No, it's not zero. And it's not negative yet. It's 0.01%. And here's Dharma through WIREN offering 12% right now. This gets updated every day. It was like 16%.

Starting point is 00:03:49 The other day, it's 12% now. It'll be 14%. Always double digits in defy. I'm running out of reasons to keep my Wells Fargo account open, other than having to pay like utility bills and that sort of thing, David. All right, man. Well, let's get to it. Should we start with markets?

Starting point is 00:04:05 What's going on in the markets this? week maybe let's start with Bitcoin as we usually do yeah Bitcoin having a rough time coming down from the from Bitcoin's new all-time high of somewhere around 63,000 I think and it has come all the way down to 52,840 so Bitcoin in a slump of a week in the in the last seven days this is not the case for ether though what's happening in Ethereum world ether is having all-time high week Every single day has been a new all-time high for the past five days, I think. Yeah, four or five days.

Starting point is 00:04:44 All-time high season. And it was really, Ether is stealing the whole entire show in the whole entire crypto markets in this last week, which I'm very excited about. We are above 2,700 as we record this. Who knows what it'll be by the time you listen. But that is definitely all-time high and, like, like, fairly high above all-time high. What was our previous all-time high? Looks like April. On the 22nd, yeah, April 22nd, we hit $2,612, and we hit, I think the official all-time high,

Starting point is 00:05:16 which we set just a couple hours ago is literally $2,800, zeros at the end. And so current all-time high, 2,800. One way to look at ether, of course, is its per unit price. The other way is to look at its market cap. And this is super interesting. Ethereum now has a market cap. of around 320 billion. That's billion with a B,

Starting point is 00:05:39 which places it above PayPal. Ethereum the network. Yeah, has finally flippant PayPal in terms of the value of Ethereum versus the value of PayPal. It's just rising up the global asset charts as we speak fairly quickly too.

Starting point is 00:05:57 Yeah. And of course, the next thing that we are looking at, I've been looking at a lot this week, is specifically the ETH-BTC ratio. And so what we are looking at is a weekly chart. So every single candle is one week. And it goes all the way back to 2016.

Starting point is 00:06:12 And we can see these violent spikes in the 2017 mania where ether went as high as 0.15 Bitcoin ether per Bitcoin. And then the bear market came. And we got all the way down to as low as like 0.018 or something, ether per BTC, very, very low. And right now we are currently at 0.5. ether per BTC. And we have not been this high in Bitcoin terms since 2018. And really, there is only a very small amount of time in Ethereum's history where we have been, where Ether has been as this high in Bitcoin terms. There's only been perhaps three or four months in total time where Ethereum has been valued higher

Starting point is 00:06:56 on a unit basis versus Bitcoin. So we are, we are kind of going into, back into uncharted waters. I don't really consider Ether has really ever charted these waters in the first place. It was nothing. Ether hasn't spent this much time above these levels in Bitcoin terms, really all that much. And so we are kind of going back into price discovery in Bitcoin terms, which is meaningfully different than going into price discovery in dollar terms. And so a lot of the traders are focusing on this, on this specific graph. They say it's just going up, right?

Starting point is 00:07:26 The TA traders. They are looking for a similarly as violent move Ether versus Bitcoin as they saw. in 2017. And so where does the ETHBTC ratio go from here? Let's find out. I'm happy to find out. Not a trader, like personally, more of a holder, but this is very interesting to observe.

Starting point is 00:07:47 And I'm always curious about the fundamentals that, or even the narratives that might be driving this shift because this is a pretty massive shift. Hasn't happened since 2017, 2018. I think we're going to get into some of that during the takes. but one take that we have right now while we're discussing markets is whenever this ratio flips in this direction, at least the last time it does, we're back to a question of, when is the flipping going to happen? The flippinging, of course, I guess the term was invented in 2017 to describe the moment in time which ether as an asset exceeds Bitcoin as an asset in terms of total market cap. There are other flippinging metrics, right? But most of which of these like transaction voluminous, volume settlement, Ethereum is already flipping Bitcoin on that. But this looks like we're 32% of

Starting point is 00:08:39 the way to flippinging on ratiogang.com, which is just like a really, really awesome website to chart the progress of ether versus Bitcoin. The other website that we've used in the past is flippening.watch for those that are more familiar with that website. But the reason why we're bringing this up today, again, is because of significant ether outperforming. versus Bitcoin, again, that we have not seen since 2018. And it also has injected itself into public consciousness, not just in the deep Ethereum crew, like me and Ryan and Anthony and Eric and anti-pro in D.C. We've been talking about the flippinging since forever.

Starting point is 00:09:19 Evan, Ryan, you said the flippinging got coined in 2017. Evan Van Ness was tweeting about the flippinging before Ethereum was even alive. So some people have been convicted that Ethereum will eventually flip in Bitcoin. at some point in time. And again, only time can tell. But traders and non-Etherium folk are getting on board with the potential flipping. And there was a fantastic podcast out of an uncommon core with Hazu with this very famous crypto trader, Kobe, who's been around for three plus cycles, like massive veteran, very much agnostic.

Starting point is 00:09:55 But as a trader, he believes that the Ethereum fundamentals have the power to flip in Bitcoin. Bitcoin nerds will obviously call this blasphemous and say that this is just impossible. But the ultrasound money thesis, I think, is Ethereum literally designing a way for it to pump itself into the number one spot. And I think if you go back to the ETHBTC chart, I think that rocket off the 0.3 level that we've seen in just the last three to four weeks, I think that's the ultrasound money pump, Ryan. I think that's what that is. You do. And you think that's the beginning. So how much of a believer are you in the flippinging then, David?

Starting point is 00:10:33 Are you like 100%? Wow. I wouldn't call myself 100%. I think it's like 90% inevitable. And I also don't know for sure whether it's going to happen in this cycle. So I would wait the probability at 90% in it kind of a multi-cycle. But still, I do think that this is going to happen. And I haven't seen Ether show such.

Starting point is 00:11:00 I guess strength relative to Bitcoin since 2017. So what's also interesting here, David, is that if you were to make the ether market cap equal to the Bitcoin market cap, we would have a ether price of $8,500 right now. That is the point at which, at these prices, ether flippins Bitcoin, at least at the Bitcoin price right now. Yeah, if Bitcoin stays the same,

Starting point is 00:11:27 then Ether needs to be $8,500. and then we flip in BTC. I think Bitcoin will be higher priced by the time that Ether flippins Bitcoin, which means that the ether price will be, of course, even more higher. So, cool. If you're 100% are you like certain that it happens this cycle? No, definitely not. Definitely not.

Starting point is 00:11:47 You're not certain it happens this cycle. Well, also, the last weekly roll-up, we talked about how this cycles moving forward is perhaps not really going to be a thing anymore. And so moving forward, maybe cycles aren't really even the correct measure of time. I'm ready to see Ether flipping Bitcoin this cycle. I think this cycle definitely has the potential to, especially with how we are, there's going to be more in this weekly roll-up about the subject matter.

Starting point is 00:12:13 But institutions are more resonant, I think, or more find easier resonance with Ether as an asset than Bitcoin as an asset for many, many different reasons. And it's really, I think, going to be institutional big money that really determines the future. of this industry. When there's so much money that's not in crypto that is coming into crypto, where that money goes determines where what assets are going to appreciate the most. And I think there's a very compelling case that is ether that is where a lot of this money lands.

Starting point is 00:12:45 We'll talk about that soon. Let's peek over at defy land. So total locked value in defy, 65 billion or so. That's also up on the week, partially due to eth appreciation, but also due, to pick up in in defy in general it's just sucking in locked value same old story that has been the story every single week ether's price going up and more defy apps are locking up more ether and so locked in value locked in defy is outpacing ether appreciation so that's pretty cool yep let's talk about defy as an asset class so the way we track this on the weekly roll-up is through the defy Pulse index. Up on the week, Defy has appreciated in value, DFI tokens have anyway, on the week. But so 535 or so, I think that's up from.

Starting point is 00:13:39 It was $500 last week, and so we're up $35. Yeah, but the ETH, the DPI to ETH ratio, that is going down, down, down. Straight line down. We dipped below the 0.19 level. The ETH-DPI level, It looked like it tried to hold point two, but it just did not hold it. And so ETH, DPI, continuing to bleed versus Ether, but, but with the more money inside of Ether, the asset, when the market cap of Ether grows, to me, that is just like sideline capital ready to flow into defy tokens. Ether first, defy tokens later.

Starting point is 00:14:19 And so while we are seeing this slow bleed of defy tokens versus Ether, I think there's a, I said this on the last weekly roll up as well, like, there's room for like the, the defy tokens to absolutely explode. When Ether finally takes a breather, Defy tokens can take their turn. And when DeFi tokens take their turn, I think it's going to be a quick move. Defy Summer V2. Defy Summer V2. Literally, summers around the corner.

Starting point is 00:14:46 All right, David, we're going to get to releases after this. But before we do, we want to thank the sponsors that made this roll up possible. Balancer is Defi's most powerful automated market. market maker. Typical AMMs just have two tokens inside of one liquidity pool, which can lead to fractured liquidity across the many pairs in DPI. With Balancer, you can access the full power of multiple tokens inside of one single AMM, which unlocks an entirely new playing field of possibility. This makes Balancer an awesome building block for so many different use cases. Balancer pools can make asset indexes, but instead of paying fees to portfolio managers, Balancer lets you collect fees from traders who use your portfolio for liquidity. Additionally, Balancer Smart pools can be programmed to have properties that change according to predetermined rules,

Starting point is 00:15:28 such as changing the swap fee based on market conditions, or even liquidity bootstrapping pools, which can help you launch and distribute your token with day one liquidity. At Bankless, we used a liquidity bootstrapping pool to sell our BAP t-shirts to much success. Balancer V2 brings powerful new features that makes your money work even harder for you. In V2, idle tokens are capable of generating yield in DeFi without sacrificing liquidity in the pool. To top things off, Balancer is reimbursing gas costs with BAL rewards, meaning that your gas fees are reimbursed up to the cost of the transaction with the Balancer governance token. Balancer's mission is to become the primary source of liquidity in DFI,

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Starting point is 00:17:03 better liquidity. You don't even have to think about it. Try it out. Download Metamask for desktop or mobile now at metamask.io and start swapping. All right, guys, we are back with the hot releases on the week. The first is this. Lending giant AVE said to launch liquidity mining program. That is the headline. First of all, lending giant Ave, that's awesome. It's crazy to me that a year and a half ago, two years ago, Ave had basically nothing, hundreds of thousands in total locked value. And now it's being called a lending giant. This is how quickly stuff moves. But what is Avey launching with their liquidity mining program, David? Yeah, so almost a year ago, Compound launched the Comp liquidity mining where you can deposit assets into Compound and receive comp tokens for those deposits. You can also borrow assets from compound and also receive comp token for borrowing assets. And better late than never, but AVE finally did the same thing. And so if you deposit assets into AVE and if you are borrowing assets from AVE, you receive an extra little bonus in AVE tokens. And so this is alive for Ave on the L1, but not included in this announcement, but still live and worth mentioning, is that there's also liquidity mining rewards on the AVE's implementation on Madd.

Starting point is 00:18:28 And so AVE carbon copied itself, deployed it on Maddick and on Polygon, excuse me, and is now giving out Madic rewards for people doing the same borrowing and lending activity on the Polygon side chain. And that's actually an activity that I am doing. And so I am earning Madic tokens by borrowing and lending on AVE on Polygon L2. And let me tell you, the gas fees on Maddoch are just an absolute treat. Transactions go through instantly, and they cost me basically nothing. And so it is a nice risk. And have those interest rates, David. And the interest rates are also fantastic.

Starting point is 00:19:03 And so... Good place to be then. Yeah, it's a good place to be. That's my alpha league for this week. I wasn't going to say that, but I have a hard time keeping the alpha for myself. You know, it's crazy is Avey has grown so large without actually a liquidity mining program to this point in time. I mean, compound has had the advantage of incenting liquidity and incenting locked value since the beginning of DFI summer. Avey hasn't had this the entire time.

Starting point is 00:19:28 It's grown as large as they do. The question is, what happens now that they actually have a liquidity incentive program? Are they going to grow even faster? I mean, it seems like that's the case. Yeah, that would imagine so. I mean, I also have some assets in Ave on the base train, and the Ave trickle is pretty, it's a trickle. It's not a flood of Ave on Polygon. It's closer to something like a flood of Maddoch tokens. I'll say that. There's your alpha leak, guys. All right. Stocks are live on Quenta as well. So Quenta, of course, is in exchange put together by the synthetics protocol. Also sponsors to bank lists. Thank you, Quenta and synthetics.

Starting point is 00:20:08 Thanks, guys. Also, they are now you have the ability to trade stocks. So synthetic versions of traditional stocks like they picked, of course, the most memeified stocks, Tesla, Apple, Amazon, Netflix, Facebook, Google. You can do this in a permissionless, unstoppable way. Pretty cool. Have you tried this yet, David? No, no, I have not because I just don't really care about equities, but synthetic equities on Ethereum is closer to stuff that, care about. And as soon as I think there's more composability with some of these assets, I think they could be extremely compelling. I think coin is undervalued. That's a separate conversation. Coin has dumped, I think, 11 days, nine out of the 11 days. It's been live on the market.

Starting point is 00:20:53 And so, you know, I would go and buy that if I had a normal brokerage, but I don't. But I do have an Ethereum account. And I could, in theory, go by synthetic coin, Coinbase. And so perhaps, perhaps. Yeah, absolutely. I think what hasn't seen to happen yet is Defy having its GameStop, you know, GME moment, Wall Street Betts moment where all of the folks who are blocked from traditional brokerages come over and see unstoppable, permissionless, synthetic versions of these same assets in Defi. I wonder if Quenta could be the start of something like that. Yeah, that's exactly right. And that's the same conversation that we had when we were going through the whole GameStop debacle is like, hey, like you guys, you guys now understand the value

Starting point is 00:21:39 of decentralization, perhaps you're warming up to crypto, come to us and come and be in our world. And then if we, when we talk to these people who are in the Wall Street best community, it's like, okay, cool, how do I buy? How do I ape into GME? Like, oh, you can't. We don't have that. But we have these other defy tokens and like, well, what the fuck is a defy token? Like, now this conversation is a lot easier. Also, in the 2018, 2019 bear market, there was just perpetual conversations about like, you know, one day you'll be able to own, you know, Apple on Ethereum. One day you'll be able to own. It seems so sci-fi at the time.

Starting point is 00:22:10 It's so crazy sci-fi, so far away, and today it's here. Yeah, it's crazy. All right. So GME folks, Wall Street Betts, folks, if you're listening, drop your Robin Hood account, come over to Quinta, see what D-Fi is like. All right, let's talk Nexus Mutual. So we've had Hugh Karp on the bankless podcast a couple of times, well, at least once. And then he's also written some fantastic articles for us.

Starting point is 00:22:32 of course, is one of the founders behind Nexus Mutual. And Nexus Mutual is growing. They provide smart contract insurance so that if you are using Defi and something goes wrong, you can take out insurance against a smart contract hack. It looks like they're growing, David. In which ways are they growing? Yeah, they are offering more cover opportunities for different types of smart contracts risk. So more contracts on around the crypto space, specifically not on Ethereum,

Starting point is 00:23:01 is now being offered by Nexus. And I think that's really the cool thing here is not only is Nexus Mutual offering protection for smart contract risk on Ethereum, they are also offering smart contract risk for things on Binance smart chain, which means that you can buy cover for your Dgen activities on Binance smart chain on Ethereum. And so Ethereum is protecting other things that are not itself in the crypto world, which I think is cool. David, I bet some of that contract insurance is going to be.

Starting point is 00:23:31 used on the Binance Smart Chain. There's a lot of interesting activity, more in the take section, I think, in Binance World Hacks and that sort of thing. Let's get to this. Why Aaron released their quarterly report. So this is their Q1, 2021 earnings reports. And you know what I'm struck by? This is really like an analyst dream, David.

Starting point is 00:23:54 Like this is basically all of the reporting that you might find in typical quarterly publicly traded company financial statements. And this is being produced by a decentralized autonomous organization. Or maybe Joel Menegris might call this a digital autonomous organization. And they're throwing up some pretty fantastic numbers. So we have a table here that shows that Q1 EBITA. So that's earnings before interest tax depreciation. It's a financial term.

Starting point is 00:24:27 4.8 million. Yeah, tradfai metric, 4.8 million. Just what's interesting to me is like these truly are capital assets. It reminds me of our conversation with our friend Matt from Bitwise. He was talking about, hey, look, defy assets are not like the cryptocurrency assets of the past, like Bitcoin or even Ether, because they have cash flows associated with them. So we could treat them like capital assets. And Wall Street absolutely understands capital assets. So here's a report for a crypto-native defy capital asset that you can analyze just like a stock.

Starting point is 00:25:07 Pretty fantastic. Yeah, I'm perpetually like perplexed by the Yerne team because they have this kind of like, we don't need to be taken seriously attitude. We'll have like wifus and like anime and that'll be our brand. And then meanwhile, they're also producing like this fantastic in-depth, you know, TradFi Ready reports and quarterly reports. And they don't even have to do this. They're just doing it voluntarily, probably as a marketing tool to illustrate their

Starting point is 00:25:38 investability as a defy app. The other cool thing is that they publish this on GitHub. And so they didn't publish this on, I don't know where else you would publish these things, but they're publishing it on. SEC. You file it with the SEC. Oh, yeah. Yeah.

Starting point is 00:25:52 No need for that. Just post it on GitHub, which it was pretty cool. And so, you know, you're always just pioneering. and doing a good job. And this is actually the second quarterly report that they've ever released. And so this is now becoming a theme. I think they don't take themselves seriously, but they definitely take their financials seriously,

Starting point is 00:26:10 which is massively impressive. They take profit seriously. They take yield seriously. That's what you want in a protocol. Let's talk about this. There's a balancer labs and nosis team up. They're coming out with some really interesting products. One, sort of a beta alpha version of that is live that we can also

Starting point is 00:26:28 talk about, but what is this new balancer nosis protocol partnership combining? Yeah, so this is something that I think it's going to take a while for me to digest. This is, I think, some really clever deep engineering that kind of goes over my non-technical head. But they have, in collaboration, they've released this thing called Cow Swap, which is a new decentralized exchange, which I think operates with similar properties that we are used to, as you would see from Uniswap, but the back-end architecture is a little different. And so I think there is some sort of off-chain relayer mechanism that we might pull from 0-0-X that helps with gas fees and also mitigating minor extractable value.

Starting point is 00:27:13 And so the gas fees, in theory, I think, are very low. And you pay for that gas fees instead of with ether, but you pay for it as part of your sale for your token. So it comes out of what you receive back. but also there is this immunity that it has or this mitigation against minor extractable value. I don't yet understand the mechanism behind this. I think this is something that it's going to take a while for the defy ecosystem to digest, but the magnitude of nosis balancer collaboration should not be under understated.

Starting point is 00:27:43 And that's really kind of the takeaway here is that composable defy apps are doing composable things, making brand new products that could not have been built without that teamwork. And so always nice to see teamwork. in Defi. I think the through line here is it's kind of the best of both worlds. So the NOSIS protocol very much is about batch auction style trades and not an automated market maker. And so they're doing that, I think, as part of CalSwap. But if the batch auction doesn't work, then basically the trades get matched against a balancer pool or even a uniswap pool. So the overflow just goes there. So you get kind of an all-in-one best of both worlds hybrid-type experience. So this is just like an alpha

Starting point is 00:28:25 version, but yeah, I think the through line is it's a blend of money protocols. It's almost a synthesis of these things coming together to make it even better system. David, should we get to the news? No, because I want to say that the cow branding was actually, the cow comes from coincidence of wants. And so the cow theme was not just like arbitrarily picked. However, it is literally Cal-themed. Yes, because this is crypto. But coincidence of wants is also the theme and is also a crypto concept. David, let's get to the news.

Starting point is 00:28:58 We've got to start with EIP 1559 because we have a date. What is the date? July 14th. July 14th. Is this set in stone or is this tentative? It's still tentative, but it's... I guess everything is tentative until the day of. Yeah, and you know, when we had Justin Drake on, his prediction was,

Starting point is 00:29:16 July 14th, but things could happen. This could slip to August, possibly September at the latest, but it feels pretty secure. Pretty secure. I'm going to go greater than 50% chance that it's July 14th. So what are you going to be doing July 14th then? Probably doing a stream, probably with you. What do you mean? What kind of question is that? Yeah. We're definitely celebrating. It's a notification on that day, David. We're going to be celebrating the first burning event of EIP 1559. Goose bumps. Just gave you goosebumps, sir.

Starting point is 00:29:48 Crazy, right? All right. Well, that's coming, as we said it was. Get up to speed on our ultrasound money episode, particularly the one this week with Justin Drake. If you haven't listened to that, we go through the models of ultrasound money, including how much ETH is expected to be burnt and its implications on issuance. Really in-depth episode there. We've done three episodes with Justin Drake.

Starting point is 00:30:09 And so if you have not watched three bankless episodes with Justin Drake, you are behind. You really should, because this stuff is going to hit hard. and fast in crypto and people are just starting to wrap their heads around it. All right, this is another one. Banks starting to wrap their heads around Ethereum maybe. This is the European Investment Bank issuing a two-year digital bond on Ethereum through a number of European banks. Goldman, Santander, among them, of course. So this is David, using Ethereum as a settlement layer for analog banking bonds, not using private block.

Starting point is 00:30:46 not using internal ledgers, but actually using the Ethereum network for some of this asset settlement. Pretty crazy that banks are now getting on board as well. Yeah, so Ethereum is being used as a credibly neutral asset settlement layer through the internet. Oh, weird. It's weird, but that's how it's being used. It's as it's as if it's been used as advertised. Weird. Yeah, I mean, the banks are going to have to come aboard this whole movement. it looks like they're still kind of dabbling in it. Like this is a big event because of the banks and the names listed.

Starting point is 00:31:22 It's a tiered digital bond. But it's not like they have moved their entire business operations and bond issuance operations to Ethereum yet. This is a step in that direction. I still feel like we're in the prototype alpha phase of all of this. But it's happening, man. Yep. David, this next one surprised me a bit.

Starting point is 00:31:39 I don't know if you were surprised, but Coinbase Pro is launching Tether. So they're going to be supporting not only USC, as a stable coin, but they're also going to be supporting tether for some of their exchange pairs. Yeah, really interesting design choice here because USDC, Coinbase has stake in USDC.

Starting point is 00:31:58 If USC grows, Coinbase has exposure to that. And so, you know, USDT, Tether, is kind of a competitor of Coinbase's interests. Now, there is insane demand for USDT, especially from the eastern hemisphere of the world. and so like profit maxi i guess if you accept tether then we can start generating fees based off of that but it's an interesting choice because tether is kind of like this black box that at least u s c is a little bit more transparent but i guess you know at the end of the day tether finally

Starting point is 00:32:30 kind of broke through its stigma of being a black box it's now that it's lindy is powerful it's now being accepted as coin base so they started releasing audits right started releasing audits and so So kind of getting folded into the fold, if you will. Yeah, it surprised me because I didn't think that USDC, that Coinbase thought it needed Tether. Right. So again, probably the profit maximalist, of course, you support more exchange pairs than you can charge. You can get additional revenue through trading fees, and that's good for your bottom line. But it had always felt up to this point that Coinbase was instead trying to propagate USDC

Starting point is 00:33:08 and sort of downplay, marginalize tether. So this is definitely a big change. I guess it's fine. Like, I guess it's a good thing, right? I don't hate it. People should have the ability to trade and use whatever stable coin asset that they want. You could certainly do that in Defi. So why not on Coinbase as well?

Starting point is 00:33:26 Yeah, the other thing I don't get, though, is that going from USDC to USDT is trivially easy with applications like Curve. Yeah. So if you have USDT, but you want to be on Coinbase, it's actually pretty trivial just to get USDC. And so I think there's more to this story, and I think perhaps the story is unfolding, and we'll find out more as things goes along. We will monitor how that develops. Here's something else that was a surprise to me. Metamask now surpassing a 5 million monthly active users.

Starting point is 00:33:58 Not long after becoming a bankless sponsor. Coincidence? Coincidence? We have the best sponsors. We really do. And we're just fortunate to be in the space early. and to get these fantastic sponsors like, but MetaMask, this is not,

Starting point is 00:34:14 this is a measure that Web2 is very familiar with. They very much like, you know, monthly active users, daily active users, and now here's MetaMask, basically the wallet for DFI, the primary DFI wallet that people are using today, and it's rocketing past 5 million monthly active users. David, if you remember in the Coinbase, you know,

Starting point is 00:34:35 SEC reports, they were doing like 6 million or so monthly, active users. So Metamask now in the ballpark of Coinbase as far as active users, that's pretty insane growth. That is pretty insane. And look at that subtitle. It says in the past six months, Metamask has grown 5x and is now used by more than 5 million users every month, which means six months ago, it was only 1 million. So we've onboarded 4 million people. That's in the last six months. That's absolutely insane. If we wanted to get a little bit more accurate, it's probably actually 5 million devices. I at least have two of those. I have two devices with two metamask,

Starting point is 00:35:13 but I'm a defy power user, right? So the average person probably only has what? And the thing that also devised that is some metamask usage might be from a large capital pool that represents an entire company or an entire Dow. So that could be like multiple people. It's part of that. Again, like a metamask account, like an eth address can represent, is kind of like a bank account. So it can represent more than one individual as well. The revenue here is pretty crazy behind this too. So if you sort of add this up as Tim Schmidt does on Twitter, MetaMask is now making 400K per day in fees, which is pretty incredible given it has for so long felt like a public good of Ethereum and of crypto that didn't have a revenue generating mechanism. Well, they turned it on

Starting point is 00:36:03 and now it's crushing it in terms of revenue. Yeah, this is a great example of a project that was birth out of Joe Lubin Consensus and Dan Finley and all that hard work and gave something of incredible value for free to the community. And it got adopted based off of the commitments to Ethereum and to Ethereum users who needed to use Ethereum. And it just got because it was free, it got adopted. And then they introduced the Metamask swap feature, which is, of course, MetaMas is still free. It's just the swap feature. Metamass charges a small fee on.

Starting point is 00:36:41 And because MetaMas proliferated itself into the Ethereum ecosystem, that swap feature has become insanely lucrative for them. And so absolutely well-deserved. Tip of the hat to the Meta-Mas team. And also, congrats to Joe. Absolutely. Congrats to consensus. David, gas fees are down.

Starting point is 00:37:00 People might have noticed that, at least on Ethereum. Can you explain why? Yeah, for a number of different reasons, we got this double whammy of both increasing the block size from 12.5 million to 15 million, which is a 20% increase. And so per unit time, Ethereum can take 20% more transaction activity. Meanwhile, we had flashbots go live. And so MEV gas wars are actually bypassing the mempool and happening off chain. Meanwhile, layer twos are here. Like I said, I've been playing around with the Polygon Avey implementation. which means all of my transactional activity is not actually going to the main chain very often. It's actually, I've only made three transactions between the main chain and Polygon. Meanwhile, on Polygon, I've made like 40 transactions. And so only out of those 40 transactions, only three actually touched the L1. And perhaps more reasons as well.

Starting point is 00:37:54 But I think those are the really three big ones. We also saw DYDX volume absolutely exploding. And so L2s are definitely taken off. David, let's switch over to, oh, before we switch over to NFTs, let's talk about this, David. Ethereum is starting to hit the mainstream in small ways right now. We're going to talk more about that, but here's kind of a symbol of that. This is Ethereum. It's being projected on CNN under the, like right above the headline, the future of finance.

Starting point is 00:38:28 One of the first times I've seen an image like this on CNN. and it has the Ethereum ether ticker price going up, of course, Green, had a great week, 7% up. What does this mean? Does this mean that Ethereum is finally escaping into the mainstream narrative or starting to? Yeah. So this is an interview with Joseph Lubin. So it's obviously Ethereum themed. But, you know, when price goes up, it grabs headlines.

Starting point is 00:38:54 And so if the fundamentals of Ethereum, if the price finally catches up with fundamentals, then that will be headline grabbing. The other interesting thing about this is that the other headline, the title here that we see is Crypto Group signs up to climate accord. They're talking about consensus. Consensus joins plan to make industry run on renewables by 2025. And a number of weekly roll-ups ago, we talked about how the headwinds coming for proof-of-work blockchains are going to be extremely strong, and we're already seeing that fight being fought. And Ethereum doesn't have to fight that fight because we're transferring to proof of sake. When Bitcoiners, when they're presented with

Starting point is 00:39:30 like but Bitcoin is environmentally unfriendly, they have to get into the trenches and they have to fight that fight. When Ethereum has to fight that fight, we just say, oh yeah, we're transitioning to proof of sake. And proof of sake is the most green thing that we can do. And so it's very much a different solution rather than fighting. It's just like, oh, yeah, we have a solution. And we committed to this a long time ago. And so that's also making its way into the mainstream narrative. Exactly. These are the narratives that are escaping into mainstream. Pretty crazy. All right, David, Eminem, Marshall Mathers. He is getting in the. NFT game. What's going on here? Welcome. Welcome, Slim Shady. Minting NFTs on Nifty Gateway. And so this

Starting point is 00:40:08 was an interesting way to cap supply where there was an open market where you could purchase these things for a fixed price and anyone could purchase these things for a fixed price. And then the timer ended and then no more can be minted and no more can be bought. And so it looks like there were three things, three NFTs that were made. One sold for 675 units. One sold for 940 units. and the third sold for 753 units. And now there shall be no more than those. So if you got your hands on one of those, congrats.

Starting point is 00:40:38 And if you didn't get your hands on one of those, you have to go to somebody that already has one in order to buy one. These NFTs are like these little M&M action figures with Eminem just being dressed up in different ways. And so I think it's pretty cool. But congrats to Eminem. Welcome to the world of NFTs. Do you think he knows he's actually deploying this?

Starting point is 00:40:57 Like he's doing this on Ethereum? Do you think he has any notion of that? Probably less so. I think there's a representative taking care of this for him. It feels very much, though, like NFTs at least have reached mainstream. So he probably knows the term NFT at least. All right, David, let's get to Bitcoin news. Ten years ago, Bitcoin creator Satoshi Nakamoto sent his final message and then he disappeared. This was the 10th anniversary of Satoshi's disappearance.

Starting point is 00:41:26 What is the significance of this? Yeah, this is always going to be a subject. of just crypto and Bitcoin lore because people have dissected Satoshi and his person and personality and his messages to the nth degree. And I don't think that that is stopping. And so this is kind of a very ceremonious time, I think, in the Bitcoin realm where they really pay homage to Satoshi and really do their best to interpret like quote unquote this sacred text of Satoshi that he left on the internet. What did Satoshi mean by this? What is your interpretation of that? And it's been 10 years since the founder of this whole entire industry that we got his last message.

Starting point is 00:42:05 And so Satoshi has been gone for 10 years now. And so that's something I think that deserves respect. It feels less like you're talking about an industry and more like you're talking about a religion and like the founder of religion the way you just described it. It's like, is that what this is? I think so. I mean, what do you think about Satoshi leaving? Was that the best thing that could happen into Bitcoin or do you think that was like the wrong move? Do you think he should have stuck around longer to answer some questions about Bitcoin, whether it's scalability or long-term issuance policy or something else? No, I think he wanted Bitcoin to be in the hands of the people as soon as possible. And Bitcoin's design itself is much less hands-on than what we are familiar with on

Starting point is 00:42:54 Ethereum. I think the opportunity for Satoshi to leave should be a taken as soon as possible. And I think that's more or less what he did. If Bitcoin needed to innovate in other ways, I think Satoshi said that thought to leave that to the people. Definitely a legendary figure. And every year, Bitcoiners are going to celebrate this. And I think crypto is going to take notice. Let's talk about Tesla. So Tesla has recently purchased some Bitcoin that made news. This week they sold 18% of the Bitcoin that they purchased. So they sold off 272 million. I think they made like a hundred million dollars in profit, which David surprisingly represented a decent portion of their quarterly profit. So that was like a fourth or something of their quarterly profit actually came from a trade.

Starting point is 00:43:47 It's funny to me that companies like Tesla, micro strategy, others are now. acting as almost like crypto traders. They're, they're definitely keeping like a fund aspect alive. And whereas micro strategies kind of just bought and hold, Tesla's actually trading some of this stuff. I don't think it's actually them trading. And so this actually, that conversation got, was very, very big in Bitcoin Twitter this last week. And so some Bitcoiners feel very betrayed that, you know, not Satoshi, Elon would sell Bitcoin. How dare he. Another religious figure. another religious figure. How dare Elon sell Bitcoin? Why he's just all he's doing is buying Bitcoin and then pumping it and then selling it? Is this just another pump and dump that Elon is doing?

Starting point is 00:44:31 I don't think that's what's going on. I think there's a much more intentful and purposeful move going on by Tesla. I heard an analysis that it was actually a investor, a protective move where Tesla needed to make sure that they could both buy and sell Bitcoin quickly and easily without with ample liquidity. And I'm not privy to those conversations, but there was some sort of like, it was a defensive move to protect against any sort of Tesla like legal issues. So I'm sorry I can't articulate more of a coherent answer to this. I heard about this from NLW's podcast, The Breakdown, where he did a pretty good

Starting point is 00:45:16 analyst, uh, job analyzing this. And so, uh, the, the, the, the, the TLDR is that like, there's perhaps some sort of compliance or risk that

Starting point is 00:45:23 Tesla took on by buying Bitcoin and they needed to quell that issue by also selling a little bit and prove that, you know, this Bitcoin is liquid. They can, they can easily access the value in it and, uh, in things of this nature. Well, I mean,

Starting point is 00:45:36 the big story is, look, it's only 18%. They still have over a billion dollars worth of Bitcoin on their balance sheet. And, um, you know, the fact that they're,

Starting point is 00:45:45 I guess, buying and selling probably to me means they're they're more likely to buy more assets in the future. So yeah, it's a, I don't see it as a betrayal. I mean, maybe if they sold the entirety of it, like that would be a different story in three months. But that would be a pump and dump. And if Elon was going to pump and dump something, it would definitely be Doge, not Bitcoin. He's currently doing that. Maybe he's doing that personally. I don't know if he's, who knows, how much doge Elon has. Does he have any? Does he own any? I doubt. I don't know. I doubt. I wouldn't know. You don't think so? I don't think so. We'll never know. All right.

Starting point is 00:46:25 JP Morgan to let clients invest in a Bitcoin fund for the first time. More Bitcoin news. JP Morgan always tends to get in on these things when they're hot during the bull runs and then forgets about crypto during the bear runs. And here they are coming back to you, crypto, giving access to a Bitcoin fund for their large, wealthy clients. Any thoughts? on this. Yeah, and if we do think that the time of cycles is over in crypto's mainstream now, that means that perhaps Bitcoin offerings from JP Morgan is also mainstream and also not going away. I love that in every JP Morgan article on crypto, they always quote his 2017, you know, calling, if you're stupid enough to buy it, this is what he said in 2017, you'll pay

Starting point is 00:47:09 the price for it one day. They always, somebody paid the price, Jamie Diamond. It wasn't the big He was notorious for calling Bitcoin a dangerous fraud in 2017. Now here he is opening up a Bitcoin fund himself. All right, David, let's get to the next company news. I feel like most of this Bitcoin news is publicly traded companies actually doing something with Bitcoin. This is Nexon, which is a game maker in Japan, actually a really large company. One of Japan's largest companies, they are $30 billion in market cap. So micro strategy, for reference, is about a $6 billion market cap company.

Starting point is 00:47:47 So Nexon is 5x larger than micro strategy. And they just allocated a small portion of their treasury, but a rather large purchase, 100 million into buying Bitcoin. What's the theme here? Yeah, 100 million is not a small number. That puts them, I think, at number nine or number 10 of world's largest owners of Bitcoin. And so congratulations. That's cool. We're continuing to see publicly traded companies and just treasuries of all sizes allocate towards Bitcoin. So cool. Yeah, you know, the blockworks group had a fantastic thread on this newsletter on this. And what they were expressing is basically like many of these CFOs and CEOs and publicly traded companies are going to do this very trade.

Starting point is 00:48:39 because they're not interested in buying bonds these days. They're not interested in buying sovereign bonds from governments because bonds are rewardless risk, as they put it, as Nexon put it in their financial report. Even junk bonds carry higher risk and were formerly known as high yield have become a source of rewardless risk. So this is kind of late stage fiat credit cycle stuff

Starting point is 00:49:05 where interest rates on bonds are really low, but they're sort of rewardless. Like, why buy a bond? So what do you do with all of the cash on your balance sheet? Well, you start to buy non-sovereign assets. You start to buy assets like Bitcoin, maybe ether in the future too. But for now, it's mainly Bitcoin.

Starting point is 00:49:22 So this is yet another company signing up for this arbitrage. Michael Saylor was one of the first, but many are coming to the same conclusion he has. Yeah. And in stark contrast to rewardless risk, Bitcoin has done a fantastic, job rewarding people who have taken risks on Bitcoin, especially Michael Saylor. Yeah, absolutely. All right, Visa CEO says Payments Giant is moving into crypto in a very big way. So we have

Starting point is 00:49:53 moved into regulation and traditional finance section of our news. Vizas keep saying they've got something really big coming. You have to believe that they actually have something really big in crypto coming. Any thoughts on what that might be, David? I can't, I can only imagine it would be using public permissionless blockchains to help improve their product. We already saw them starting to settle USC payments between some of the big crypto banks. And if they are planning on moving more into crypto in bigger and badder ways than that, I literally have no idea what it could be, but I'm excited for it. Stablecoinish, maybe their own stable coin, maybe they adopt USDC.

Starting point is 00:50:36 I'm not sure where this could lead, but they keep talking. talking about it. So something is definitely coming. David, let's, well, we're on the subject of FinTech and Visa making statements like this. So is PayPal. This is the CEO of PayPal. Dan Schlumen, cryptocurrency is the real deal, he says in this article in time, and super apps are coming. I'm not sure what he means by super apps. I haven't read this full article. But cryptocurrency is the real deal. They weren't saying this in 2017. This is completely new. This is defamation. This is defy mullet stuff where you've got fintech now supporting defy rails and cryptocurrency rails. Maybe PayPal's doing something big in this space too?

Starting point is 00:51:19 What do you think? Yeah, good timing on PayPal talking about how awesome crypto is right after Ethereum flip into PayPal and market cap. You know, if you can't beat them, just join them in that case. And there's definitely a lot of resonance with PayPal and digital assets at large because PayPal before it was PayPal tried to be some sort of, you know, premature. a little bit too soon, you know, early internet money. Internet money, right?

Starting point is 00:51:43 Like, it tried to do that and couldn't really do it because of all the ways that centralization fails. But there's definitely resonance between this company and digital assets. And so I expect PayPal to really be a pioneer in the space. In other PayPal news, David, Coinbase is now allowing U.S. users to buy crypto using PayPal. So it's not only an ACH transfer. If you have a PayPal account and you also have an account on Coinbase, then you know, you can just purchase your, your crypto assets on Coinbase with PayPal. So some more cozying up

Starting point is 00:52:15 of FinTech to the crypto industry here. Yeah, which is also interesting because last week, Venmo rolled out crypto assets. And so you can also buy Bitcoin and Ether and other crypto assets using PayPal. And so I wonder how deep this partnership goes. Is this even a partnership? When I buy Ether on Venmo, where is that ether actually coming from? Are they tapping into Coinbase to be their exchange? I don't know. I think some more details about this would be nice. All right, David, we're going to get to takes in just a minute, but before we do, let's thank the sponsors that made this episode possible. Bankless is proud to be supported by Uniswap. Uniswap is a new paradigm in asset exchange infrastructure. Instead of a cumbersome order book system where trades are

Starting point is 00:53:01 matched with other humans, Uniswap is an autonomous piece of software on Ethereum, which is what Ryan and I call a money robot. No human counterparties or centralized intermediaries, just autonomous code on Ethereum. Input the token you want to sell and receive the token you want to buy. Something brand new in the Uniswap ecosystem is the Uniswap grants program is now accepting applications for grants. We have been saying this for a while and we'll say it again. Dow's have money and they are in need of labor. If you think that you have something to contribute to the Uniswap Dow, apply for a grant to Uniswap. Just look at the size of the Uniswap treasury. It's almost $3 billion. This mountain of capital is looking for labor. Do you have something of value to contribute to the Uniswap Dow? No matter how big or small your

Starting point is 00:53:47 idea is, you can apply for a Unigrant at Unigrants.org and help steer Uniswap in the direction that you think it should go. That's exactly what we did to get Uniswap to be a sponsor for bankless, and you can do the same for your project. Thank you Uniswap for sponsoring bankless. Gemini is the world's most trusted cryptocurrency exchange. I've been a customer of Gemini since I first got into crypto in 2017, and it's been my main exchange of choice to make my crypto buys and sells. Gemini is available in all 50 states and in over 50 countries worldwide, and on Gemini there are markets for over 30 various different crypto assets,

Starting point is 00:54:23 including many of the hot defy tokens, and it's one of the few exchanges that has liquid dye markets. Gemini just launched their Earn Program, where you can earn up to 7.4% percent interest on 26 various crypto assets. If you're tired of paying fees in defy or you don't want to worry about defy exploits but you still want to earn interest on your crypto assets, Gemini Earn is the product for you. Another product I'm stoked to get my hands on is the Gemini crypto back credit card

Starting point is 00:54:49 which gives you 3% cash back on all of your purchases but paid to you in your preferred crypto asset. When I get my Gemini credit card I'm going to make sure that I get my cash back in ETH so whenever I buy something I get a little bit of bonus back to me at the same time. You can open up a free account in under three minutes at gemini.com slash go bankless. And if you trade more than $100 within the first 30 days after sign up, you'll be gifted a free $15 Bitcoin bonus. Check them out at gemini.com slash go bankless. All right, David, it's time for the hot takes of the week. Let's start with the hot take that you had. It seems like you're part of never sell gang. What are you talking about in this tweet?

Starting point is 00:55:30 Yeah, never ever sell your eth. At least, I'm not recommending that, but it is an option to you to take if you so choose it. And so what I say in this tweet is that you could collateralize your ether and just borrow against it. And because ether is ultrasound money while the US dollar is perpetually devalued by the money printer, having ultrasound money as collateral and having your debt denominated in something that is perpetually being devalued is an advantageous position to have. And so you also, don't have to pay taxes because you're not selling your ether, you're just collateralizing it. And so you collateralize your ether, and perhaps we can even talk about our ether, rocket pool ether, which is staked ether, so you can have upside to staking, collateralize our ether, borrow dollars against that. Meanwhile, your ether appreciates, and you also get more of it because it's in our ether form, staked ether form. Meanwhile, you borrow against it, send that borrowed dollars to your bank account,

Starting point is 00:56:28 ball out, call it a life. And then hopefully, if everything goes according to plan, this is where the risk comes in. There's no ever free lunch. Your debt, in theory, just melts away because the dollar is being printed. Meanwhile, your ether is appreciated because it's ultrasound money. And so that is an option that I think could, if you manage your risk appropriately and you don't get out over your ski tips, you could be in the hashtag never sell gang. So I'm adding two more hashtags to this.

Starting point is 00:56:57 hashtag not financial advice, hashtag not tax advice, consult your own tax. Hashtag in theory. Hashtag hypothetical. Yeah. So never sell gang. We even ran an article about this on Monday about many people who are just rather than selling their ether, they just plan to stake it and use it as a productive asset. So there are many ways to be kind of never sell gang if that's what you choose to do.

Starting point is 00:57:22 It's also a viable path to create a sell plan and just have price targets and sell as you go up. What you're talking about here, David, I think it matches well with the Alchemics. Yeah, Alchemics episode that we did earlier this week, which was another way to sort of take out future yield against collateral that you already had. I would like to remind people, though, of one thing. So I saw some people take this strategy, David, when Maker was first launched in 2017 and 2018. Some of these were very bullish, Heath, as you are, as I am right now. They took out Maker CDP loans. ETH was about $1,000 or so.

Starting point is 00:58:02 They thought, no way it goes below $300. No way it goes below $200. David, we got to $80 in the price of the. Heath lost 95% of its value. So the risk that you were talking about towards the end is ETH is heavily volatile. We may never see a 95% drop again, but it's possible we could.

Starting point is 00:58:27 I saw some people get liquidated in 2018 who were pursuing a similar strategy, but just didn't leave enough room. So if you do this strategy, I'm sure you would agree that it's all about your liquidation number, because you are adding some risk to this. You are adding some margin to this kind of thing if you choose to do it. Any thoughts on that? Yeah, very, very, very true as well. Anytime you are borrowing it against your collateral, you have the risk of being liquidation. And even if you have a very, very, very low liquidation price, let's rewind back into December 2017. Maker Dow just went live. Ether is $1,200. And you come in and you say,

Starting point is 00:59:08 I'm going to be super safe. I'm going to make my liquidation level $150. Eventually, it seems super safe at the time. And eventually, Ether got down to that price. And if you didn't do anything between Ether being $1,200 and Ether being $150, you get liquidated and you are forcibly selling the bottom, right? You are forced to sell the bottom. And so one way to manage this risk is that, say, same scenario, you collateralize your ether, $150 liquidation price, ether is $1,200, but then ether gets cut to $600. And so you're still plenty safe, and you have an opportunity to then unwind that leverage,

Starting point is 00:59:49 sell some collateral before it, and maybe you go from $150 down to $75. And so you do sell some collateral. You are no longer in the never-sell gang, but you are managing your risk appropriately. And if you did do that in that hypothetical scenario, you would have never had to sell your ether at the low-low price of $150 because you adequately manage your risk on the way down. And like you said, Ryan, I don't really think we're ever going to see 90% drawdowns ever again, crypto's mainstream. But that's speculation, so it's not guaranteed.

Starting point is 01:00:20 But I think as, and similarly, MakerDAO was the only credit facility to really offer this opportunity. Now, in Ethereum, we have many, many, many more credit facilities. We have AVE and compound. We have Liquity, L-U-S-D. And we also have alchemics. And so we have more tools at our disposal to appropriately manage our risk and also still be able to really capture that juxtaposition, which is really the through line of this tweet. originally, the through line of this tweet is that there's a massive juxtaposition between

Starting point is 01:00:54 ultrasound money and US dollar, where it's advantageous to have ultrasound money as collateral while also having dollar denominated debt, because the juxtaposition between the two assets couldn't be more clear. And there's different defy apps that allow you to tap into the power of that juxtaposition that could be in your favor if you adequately manage risk. Yep, absolutely. All right, let's get to the next take. I felt like this was reporting. week for Ether, David. So, yeah, it had been, I don't know, right, 2018, 2019, almost 2020, almost no financial analysts wrote anything about Ether as an asset. No, we were trying to do that. Like, we were trying to do that. Like, many, many reports came

Starting point is 01:01:39 out about Ethereum as a smart contract network and the potential of these sorts of things, but no one ever zoned in on Ether as an asset. If they did, I remember reading some, like, bearish reports from financial analysts about how they were going to short ETH back in those days. But now we're getting reports on a weekly basis. Just last week, we got three. This is a almost like a sort of an institutional report that was made by a retail amateur investor, which is incredibly comprehensive. This whole report is about 78 pages or so. We'll include it in the show notes. guy named Squish Chaos, and he goes through basically a lot of the things that we've been saying about ultrasound money, about the demand drivers, about the catalysts of the triple halving.

Starting point is 01:02:29 We talked about this on the last week's roll-up, which is basically EIP 1559 and the merge that are coming up in the next nine to 12 months and how this will cause a 90% reduction in issuance, talking about narrative adoption. And David, the price that this analyst is calling for is in the bare case, 30K-Eath, 30-50-K-Eath. And in the speculative fever-like case, 150-K-Eath by January 2023, like more bullish than we've ever been on bankless. So this first report blew my mind. I don't know if you were able to read any of it, but it was absolutely, it was well-reviewed. and well put together for sure.

Starting point is 01:03:15 Yeah, the number of different reports coming out is awesome, first off. And like you said, this is kind of a reiteration of some of the ultrasound money thesis, proof of stake, merge, reduce issuance, burning issuance, blah, blah, blah. It's important to have many different reports articulating similar things from different angles because you don't know what's going to catch on and what's not going to catch on. And sometimes people just need things to be articulated differently for them to really resonate with things. And so the fact that multiple reports are coming out about Ethereum, all talking about similar through lines, but in different roundabout ways, really it's catching, it's casting the widest net

Starting point is 01:03:52 to really capture some of those, that investor mindset. Yeah, so that was a report by an amateur analyst. I would call them that's actually very sophisticated. A report came out by a crypto fund called Two Prime, and this was targeted at institutional investors. We'll include a link to the full report in our show. notes, but here's a statement for you. We believe that ETH has earned a place alongside Bitcoin as an institutional grade investment, store of value, and treasury reserve asset alongside

Starting point is 01:04:25 Bitcoin. Pretty crazy. That's the message getting out there to institutional investors from crypto funds. This last report was actually put together by once again, our friends at J.P. Morgan, why is ETH outperforming is the title of the report. Here's a quote from it. Bitcoin is more of a crypto commodity than currency. It competes with gold as a store of value. While ETH is the backbone of the crypto-native economy. I wouldn't fully agree with all of that, but they got the last part right, which is

Starting point is 01:04:55 ETH is the backbone of a fully crypto-native economy. So the narrative is seeping out through these reports at the retail level, at the institutional level and even among bankers who are issuing these things. Yeah, the parallel here between the dollar being the backbone of the world because of how it is the petro dollar, right? If you want to access energy, gasoline, you need to be using dollars. That same metaphor is alive with ether, where if you want to do stuff in defy, you need ether and ether is the backbone of the crypto-native economy.

Starting point is 01:05:31 That's basically saying ether is the money for the internet. Heath is money, leaking out. David, there's no floor for ETH supply. I heard you say this on our podcast with Justin Drake. I think there was a spur of the moment thing. What do you mean by this tweet? Right. So Bitcoiners and supply cap maximalists will often critique Ethereum as like, well, there's no supply

Starting point is 01:05:53 cap to ether. So why would it ever be a store of value? And while that's already not a very nuanced take, like correct, there is no supply cap to ether, that doesn't mean that it's not extremely scarce. When we have EIP 1559 burning a bunch of ether and the proof of stake system not issuing very much ether, in the case of a deflationary ether, there is in similar ways that there is no ether supply cap. There is also no ether supply floor. We could, in theory, burn all of the ether. Just like in theory, there's an infinite number of ether out there. In theory, there's also no floor to the ether supply. So Justin Drake modeled out the, the, uh, the, the, uh, the case for ether supply going as low as 100 million units when we are currently at 115 million. So what would it take to burn 15 million units to get the supply back down to 100 million? Go watch that the modeling ultrasound money video that we just did with Justin Drake.

Starting point is 01:06:52 But he put a time frame on that of something like 15 to 20 years. 20 years plus, we could just go through the fake floor of 100 million, the round number floor and just keep on going. There is no ether supply floor. Yeah, it makes sense. It's a counter narrative. David, I'm going to give this a retweet. I like that one. Why haven't you already?

Starting point is 01:07:12 Well, done, sir. I'm just seeing it now, okay? Just saying it now. David, let's get to this last take. This is about the finance chain exploit. So there was an exploit. I believe, do you recall the name of the protocol that was actually exploited? No.

Starting point is 01:07:31 Here it is. Uranium finance. Almost like it's not important. Don't remember that one. Right. Uranium finance. So there are many things that are popping up on Binance Smart Chain these days. This one stole 50 million in users fund. So there's some sort of a backdoor or a way to access those funds.

Starting point is 01:07:54 Uranium finance stole the 50 million on Binance smart chain. What's interesting about this scenario, I think, David, is it sort of starts to test the limits of decentralization of the base layer. So I kind of think of this, I kind of think of Binance Smart Chain as almost like a centralized casino. You could argue all of finance is a casino, that Ethereum is a casino too. But Binance Chain is really a centralized casino.

Starting point is 01:08:19 There is a centralized operator. So this was as if somebody, you're the casino operator, put yourself in the position of CZ, someone stole money from your customers in your casino. Most of the money, some are still in the building. So you have the ability to go catch the people who did it and restore the funds. You're the casino owner. Do you freeze the stolen funds and return it to its rightful owners?

Starting point is 01:08:46 Or do you do nothing? And here's the catch, right? You have been telling everyone that you don't have the power to freeze the stolen funds. That finance chain is decentralized, that it is defecralized, that it is defecalized, that it is defy and you've been pretending to not have this ability. So now what do you do? You're caught in this like crosshairs of decision. So I'm curious as to what Binance does.

Starting point is 01:09:12 The article in question talks about the victims of the hack talking to the Binance security team about ways to remediate this. I'm very much wondering how it gets worked out. Maybe it gets worked out by, you know, Binance. gives them some of their funds back from an insurance. Maybe CZ decides and finance chain decides to actually pursue the hackers and freeze their funds and restore the funds. But this is kind of the predicament that you're in when you actually have the ability

Starting point is 01:09:44 as a chain operator to censor transactions, freeze funds when it's actually a centralized system rather than a decentralized system. Any thoughts here? Yeah. And the predicament to me is you're kind of damned if you do. damned if you don't, right? Because if you do roll back the chain and restore funds, then those users are happy. But one of the reasons why defy is what it is today is because no one is coming to save poorly constructed defy applications. And so they need to be built right. And so there's less of an

Starting point is 01:10:16 urgency for applications on Binance Smart Chain to really get things right if CZ does decide to just roll back the chain and give people their money back, which means defy on Binance chain will always be like, you know, given protection by this all-powerful, you know, overseer. And they actually can't escape into their own responsibility and take responsibility for their own smart contractors themselves if they keep getting rescued by CZ. Or CZ does nothing. And that's costly in of itself.

Starting point is 01:10:46 Like, well, then why do we even bother with the centralization? Like, what are we actually getting here? Yeah, and if he does nothing, maybe this time, might not be able to get away with that if the amounts are, say 500 million or if you get a notice from the authorities requiring you to restore the funds. So yeah, it's interesting to see all of this play out. David, let's move to what we are excited about this week. I'm going to ask you first. What are you excited about, my friend? Well, the first, really quick, the first and foremost thing I'm excited about is Eric Connor increasing his

Starting point is 01:11:19 price targets up from $2,500 to $15,590. And so thank you, Eric Connor, for becoming more bullish. We finally got him, ladies and gentlemen, to rescind against his sins of being overly bearish. And now Eric Connor joins the clan of being Heath Bulls. My ETH Maxy side is coming out a little bit too much today. But the other much more reasonable thing I'm really excited for is the podcast coming out on Monday, this coming Monday out of the bankless podcast. and it is all about drawing the connections between the Renaissance of the 1400s and perhaps the crypto renaissance that we have ahead of us, making the claim that the crypto renaissance ahead of us is equal to or larger than in magnitude the Renaissance that we experienced back in the 1400s in Italy.

Starting point is 01:12:13 And the connections here are two very specific types of technologies, one communication and one financial. In the 1400s, we invented double entry bookkeeping and also the printing process. press. And that allowed for freedom of information and just fintech, really just more financial tooling. And that those two things really created art, culture, churn of value, new ways to distribute wealth. And that really created the cultural renaissance that we saw in the 1400s. And when we make the claim that we are about to see that same effect again coming as a result of a crypto renaissance moving forward. And it could be even bigger than the original Renaissance due to how things just move faster these days.

Starting point is 01:12:54 Really cool podcast. Yeah, I can't wait to release that, man. I can't wait to listen to it. Is it edited? I can't listen to it. That's the, on the rest of my to-do list today. I got it back from the editor this morning. And so I'm going to slap some music on there and put it out. And we're going to have it for early release for the bankless listeners. And so if you are a paid bankless listener, you can go and listen to that right now. Awesome, man. That includes me. I have David. I know. Are you not a paid user of bankless, Ryan? I don't. I'm not. Oh, I'm not going to make it. After all this time. All right, Ryan, what are you excited about?

Starting point is 01:13:29 I'm excited about Bill Ford. Bill Ford. What a guy. Bill Ford is a 77-year-old guy. I don't know where he lives. I've seen him active on crypto Twitter. He's an active member of the bankless community. And you know what Bill Ford is doing?

Starting point is 01:13:46 He's teaching himself Defi, David. 77 years old, he's learned. MetaMask. He's emailing us because he's trying to claim his badge. He was successfully able to claim his badge. And he is learning. He's asking fantastic questions. And he's tweeting at us all of the time. And it just kind of hit me like bankless is a movement for everybody. Defi is a movement for everybody. If Bill Ford at 77 years old can figure this out, like what's your excuse for not like spending some time and learning this. Anyone can learn crypto. If you're 10 years old, right, you could start pursuing a MetaMask account. If you're like a 77 year old man,

Starting point is 01:14:33 a 77 year old woman, wherever you are in the world, you can start learning crypto. You just have to take the time and apply yourself. So look, Bill Ford can do it. You can do it. Really excited to have a a diverse community with us on the journey because this is a global movement for everybody. Yeah, nice job, Bill Ford. Much respect to you and getting into a defy. It's not an easy task even for the internet native people. And I wonder what it's like to be Bill Ford, who is a member of the silent generation, not the boomer generation when you and I are just shitting on boomers left and right here. I wonder what he's listening. No, we don't do that. Yeah, what it was, those boomers, David and Ryan, right, those goddamn boomers.

Starting point is 01:15:16 I wonder what that's like. Elit boomers, David. You have to, you have to credit it. Boomer elite, right. Boomer elite. All right, David, the people that we don't like. Let's get to you the meme of the week. Meme of the week.

Starting point is 01:15:27 Bankless meme. You want to read this one out, Ryan? Yeah. It's just a picture of, you know, those chain pens at the banks they have? It's just a picture of a chained up pen that you might see at any retail bank that you enter. It just says this. This is how much of the bank. banks trust you. They can't even trust you with a pen. Just chain the pen up. That's it. That's the

Starting point is 01:15:53 tweet. Full stop. That's the meme. This was a meme created by Orion. Wow, 3,000 likes. Holy hell. Wow. Nice job. Yeah. I retweeted this, this tweet and I said, the banks would chain you up too if they could. And that was my conclusion. Nicely done. All right. Let's go to a runner-up meme because this is great too. David. You want to explain this one? Yeah, this is the never-sell gang. I mean for the never-sell game. It is the Lord of the Rings. This is the return of the king where they're doing a flashback to Elron, the elf king talking to,

Starting point is 01:16:27 I can't remember his name, the human who's got the ring. Isledor. Isle-door, right. And he's about to throw the ring into the fire and just banish evil from the land. And he goes, the elf guy goes, take some profits, sell it. And the guy goes, no. No, I won't. And of course, the ring he's holding is actually ether, the ether coin.

Starting point is 01:16:49 And so refusing to take his profits and refusing to sell. However, if you are receiving life-changing money as a result of this crypto revolution, do consider taking that life-changing money and actually changing your life with it. You don't necessarily have to hold on to paper games. Wait, wait, wait, wait. What happened to never sell gang, David? It's not, never-sell gang is not for everyone. You need to understand that that may or may not be your life.

Starting point is 01:17:14 you do not have to be in the never-sell gang. You can sell your ether. It's okay. I, however, am going to do my best to be in the never-sell gang. We are convex thinkers, right? As Vitalik would say, right? So you could, why not a blend approach? Just don't sell everything. Maybe sell a little bit. Definitely don't sell everything. ETH is turning into a productive asset, global monetary asset before our eyes, as is Bitcoin, at least the global monetary aspect of it. David, this has been a roll-up we are in the fifth week of april what a year it has been so far guys of course thank you for joining us on the bankless journey none of what you heard was financial advice none of it was tax advice bitcoin is risky eth is too so is defy you could lose what you put in

Starting point is 01:18:02 but this is the journey west and we're glad you're with us thanks for joining us on bankless

Bankless - ROLLUP: 5th Week of April (ETH All Time High, Eminem NFT, Tesla Sells BTC, JP Morgan Crypto Fund)

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