Bankless - ROLLUP: Bitcoin ATH's In Sight | Coinbase Crashes | Blast Mainnet Live

Starting point is 00:00:03 Bankless Nation, happy first week of March. Welcome to the bull market. David, how you feeling, man? I'm feeling pretty good, Brian. Yeah, it's Heath Denver Week. Bitcoin is pumping like it's never pumped before. Eith is following on suit. The rest of the market is waiting patiently.

Starting point is 00:00:19 But, you know, when Bitcoin adds $200 billion to its market cap in one week, yeah, yeah. Almost $10,000 to the Bitcoin price in a single week. Yeah. Turns out the Bitcoin ETF was bullish. Who knew? Well, we're going to have giant smiles on our face throughout this entire episode because we are definitely in bull market territory. Got to start with Bitcoin. I'm throwing my capitulation flag on the quiet all-time highs. Oh, that didn't last long. Yeah, if Coinbase went down, it's breaking into like the top 100 on the app store.

Starting point is 00:00:53 It's, yeah, that that was the quiet part of shout. Your heart was in the right place, but I kind of felt like that was not going to work out, man. The market is not going to listen to. to be quiet when Bitcoin is almost crossing, it's crossed 60K and all-time highs are in sight. So we've got to talk about that first. What else we got? Coinbase went down, people freaked out, and then it recovered and things went up again.

Starting point is 00:01:17 But the point is that Coinbase went down, which is... The bull market. It's a bull market. But also, like, retail is here. Like, people are redownloading Coinbase for the first time in a long time. Also, Cracken, making some very big moves, dropping a reverse Uno card to Gary, Gensler and launching Cracken Institutional in the same week.

Starting point is 00:01:36 It just feels like when crypto starts winning, Ryan, we can't stop winning. And speaking of winning, Gemini has released its settlement with Genesis. You're never going to guess how much money you're going to get back, Ryan. Yeah, me personally. You're talking about me personally. Thank you. And anyone who is a depositor of Gemini Earn, yeah, you're going to be happy with a number that you're getting back.

Starting point is 00:02:01 Some good news. Unexpected news, too. We got Uniswap is back with a fee switch proposal and prices were pumping on the Unitokin. So that's another one that caught a bid. When a multi-billion dollar ERC20 token pumps 70% off of a proposal, like we might be in a bull market. Lens protocol is now permissionless. Also, Blast is now live on Mainnet. We got to check in with that.

Starting point is 00:02:23 But before we get to all of that, a message from our friends and sponsors over at Cartese. David, who's Cartesey? What do they want the bankless nation to know? Yeah, Cartesey is working in the app chain ecosystem. I actually met some of the team and founders over our bankless meetup here at East Denver. It's East Denver Week. That's why the background of my place is not my home in Brooklyn, for them in Denver. So they have a $1 million ecosystem grant initiative.

Starting point is 00:02:48 So if you are a developer who likes to work in Linux, because this is a Linux alt-vm modular app chain platform, Cartese. We're going to talk about that a little bit further on in the show. But if you are a developer who likes Linux and wants to build app chains and build your own custom VM, there is a link in the show notes to get some money to go build with Cartese. It's kind of, you have to like Linux and you have to like money, right? Because $1 million. That's not a small grant here from Cartesey.

Starting point is 00:03:17 If you like Linux and you like money, wow, that's a pretty good overlapping Venn diagram. Guys, there's a link in the show notes where you can go apply for the Cartese grants program. David, you know what? I think it's time before we get into the actual numbers on the. week, which we're going to get to in just a second, just to spend some time reflecting because we are on the cusp of crypto all-time highs. We're almost at Bitcoin all-time highs, and pretty much everything else is going to follow. So I think we should just like enjoy this moment. We should just take a minute to reflect. And you wanted to share something over from Eric Wall. Maybe we start with that.

Starting point is 00:03:51 I think Eric Wall set it up just so perfectly. I'm going to read out a tweet from his. He says, So the market did really wipe out SBF, Doe Kwan, three hours capital, and then it went shooting for all-time highs, like, not as a joke, but for real. So Luna really did go to zero. SBF really is in a cell prison. Kwan is really getting extradited. Sue had to drop every last one of his shit coin logos from his display name, and Kyle is in a shed somewhere chopping wood. That's a Twitter meme for those who are on Twitter. The cryptocurrency saga moves like poetry.

Starting point is 00:04:24 how is this real? When did you experience something like this that you need to take it in with every fiber of your body? Every hair should be standing on your skin. I do want to say that this week particularly was a monumental week in crypto history. And we don't get many like those often. So it's worth appreciating. It's worth reflecting. And the kind of the cool thing about why it's such a big deal is because Bitcoin pumps so hard. Like actually, that is. why this is such a monumental week. It pumped $10,000 inside of a week because of the Bitcoin ETF. We're going to get into some of the milestones, the new high watermarks, not just for Bitcoin ETFs, but global ETFs. And it's just a sign of just like a milestone that this entire industry has crossed over because a lot of just what, or Bitcoin's destiny, its manifest destiny, has been finally achieved in this first week. Legitimacy, acceptance, adoption, in Tradfai, with all the boomers buying the bags. And we also still get to have our own internal ecosystem

Starting point is 00:05:29 where we have Bitcoin pumping $10,000 on one side. And then we have dog shit coin meme coins also pumping on our side of things. I think Eric's reflection is really important here because he's basically saying, look at what we just lived through. Like, how is any of this real? It feels like we lived through some kind of simulation.

Starting point is 00:05:49 Like this is just such a bizarre world show. I can't believe we went through this over the last 24 months. It's been absolutely crazy. Just like all of the character arcs, you know, all of the, the stories that were closed. It's just such a crazy time in crypto. I don't think I will ever forget the last two years, that's for sure.

Starting point is 00:06:09 And the sitcom that is crypto is absolutely unreal. Just to really tie off a loose end here, can you just scroll down so we can see Kyle Davies chopping wood. What? This is real. This is a tweet that he made where he just says, this is Kyle Davies, let me share with you my newest passion.

Starting point is 00:06:28 Chopping wood. I spent hours every day in meditation, building fires from scratch. Each swing of the act is physical, relaxing, unless my mind explore new boundaries. I'm sure if everyone who's chopping word right now, we'd be at one million BTC. Just insane copy pasta.

Starting point is 00:06:42 Former crypto billionaire, I think, probably, or close to that, Kyle Davies, and one of the co-founders are three hours capital, and now he's chopping wood this bull cycle. Chopping wood for heat, you know? You know, I want to share another reflection. Like, to everyone who stayed during the bear market, you guys stayed for the last 24 months. If you're tuning to bank lists, you know, like, you're probably not new here.

Starting point is 00:07:05 You're probably been around. You're probably listening during the dark period of the last 24 months. I just want to say this. In the upcoming weeks and days, a bunch of people will tell you you didn't deserve these gains, right? Crypto, you got lucky. It's, you know, like all-time high. Like, making money shouldn't be this easy. let me tell you it actually was really hard and for those who stayed you did your research you

Starting point is 00:07:28 accumulated when everybody else was running away you resisted the overwhelming urge to believe all of the fud that that crypto was dead you didn't follow the herd they left and you stayed and don't let anyone tell you you don't deserve these gains okay because you earned it over the last two years of time and that's really when you earn it is during the bear market uh season so congrats just just Just spend a moment to think about that. Yeah, well done. Now, don't get too high on your horse, though, right? Yeah, not too soon.

Starting point is 00:08:00 Not too soon. We have to save some hats on the back for later, too, and we actually do cross all-time highs. Also, just big shout out to everyone's net worth who's higher now than it was at the peak of the market last cycle. We're not at all-time highs now, but, you know, shout out to the people who bought $20,000 Bitcoin. That's how you really would.

Starting point is 00:08:18 That's how you really would. Shout out to people who bought sub-1,000-eaths. Shout-up to people who bought like $10 Salona. David, this mean... Accumulating in the bear markets is like, you know, once every four years opportunity and that last bear market won't be coming back again. I think this mean that you sent before the episode really sums it up of what the balance we're going to have to strike during the bowl market is, you know, like, do buttons to click,

Starting point is 00:08:38 like two choices. And somebody saying, this is David, the past couple of weekly rollups. One, button one is stay humble. Button two is, I effing told you so. You are, like, we are juxtaposed between those two options. Like, there's a little bit you want to stay humble and a little bit of, like, we were right, we stayed. It feels good. Yeah. Surprise. Believing in crypto was the right answer. Who know? One thing I was thinking as well as, as you sort of zoom out, you know how often we've

Starting point is 00:09:04 compared crypto to the internet, the birth of the internet. And if you go to Google and you type, like the consensus date of the birth of the internet was 1983, actually. Okay? So 1983. It's very interesting. If you extrapolate that forward, 15 years later from 1983 was about 19. 1998, all right? And I don't know if some people remember what the internet felt like in 1998. It was very much like new territory. It was this exciting technology that this horizon. And that was like right before the dot com boom. Okay. It was just like a little bit into it. And then of course of the corresponding years, 1999 and 2000, you got an absolute explosion in market prices. Right. So that was 15 years into the internet. It's very interesting, David. If you if you, if you, uh, look at crypto right now. We are, 2024 is actually 15 years now into crypto. So the Bitcoin just celebrated its 15th birthday from the first block. We are now 15 years.

Starting point is 00:10:03 And so the question is, what's going to happen next? I feel like every cycle we talk about, well, it's like the dot-com bubble, right? It's the dot-com boom and the dot-com bust. I wonder if we're actually going to see that this time. Do you have a taken, like, what year it is in terms of the internet? Do you think we're in 1998? or do you think we're like after you know the dot-com boom

Starting point is 00:10:24 do you think we're in the 2000s somewhere? Yeah, I think really you can only understand patterns and I don't think you can really carry it over one to one. I think the biggest evidence to say as to why crypto will experience some sort of dot-com boom-sized movement in the markets is A, we are actually

Starting point is 00:10:43 tapped into traditional financial markets right now and there is the colliding particle of AI as well. well. The AI crypto overlap and AI crypto retail speculation and just innovation in AI where a lot of that value is going to be able to be much more

Starting point is 00:10:59 easily expressed in crypto tokens which are easier to mint because whether it's an ERC20 token other than like a printing press for financial assets. I think like it's really those two things coming together. That is like a we're redoing the internet both on the crypto side of things

Starting point is 00:11:15 and on the AI side of things but crypto is offering the financialization of the AI side. Crypto is going to be able to tokenize to express value of AI innovations way better than any public listing on a stock market. Unless we do like a whole like Spack era again.

Starting point is 00:11:32 But I think that crypto AI synergy I think is very, very strong. I also think, so for me personally, it's still my take that we're going to absolutely boom and then we're going to crash. Like it's still my take that there's no such thing as the super cycle because this always happens in these fractal patterns. Paper gains can become very weighty.

Starting point is 00:11:48 So I think we're going to go higher than anyone thought this bull market, and then that will be followed by a crash. What say you did that? Or are you on team Supercycle? This time it's different. No, I think we have been in one super cycle since 2009. Yeah, for sure. Yeah. All right. Well, we'll see how it plays out, man. We're in the bull market now. Let's get to some charts. What is Bitcoin like on the week? Thanks to Cracken for providing these glorious Bitcoin charts and Cracken Pro interface. What are we looking at? Bitcoin is moving really, really fast. I have to update these prices in real time.

Starting point is 00:12:19 $62,150. It is down a whopping $2,000 from the moment I woke up this morning. And it is still at $62,000. It is up 21% on the week. We are 9% away from all-time highs. 9% away from all-time highs. So what is the number for all-time highs that we got to beat? Yeah, previous all-time high set on what was the day.

Starting point is 00:12:44 November 10th, 2021, $69,000. Nice. Wow, 69,000. So we get above 69 and we're good. We get to 70 and we're good. Do you know Bitcoin has already passed all-time highs as measured in the fiat currencies of about 30 countries? That includes China and India. This is a tweet from Bologi showing all of the countries where Bitcoin is already at all-time high in terms of their local fiat currency. We're not there with U.S. dollars, but I mean, we're getting real close, David. I mean, U.S. is the final boss, right? Like all fiat currency. are losing to the dollar and then the dollar will soon be losing to Bitcoin. One of the big stories, one of the big reasons why has been inflows, tradify retail inflows. It has been the big story. For the last two weeks has been the crescendoing volumes into the Bitcoin ETFs.

Starting point is 00:13:38 I think it's safe to say beyond anyone's expectations, right? Well beyond anyone's expectations. Like even the bulls are pretty surprised about the success that the Bitcoin ETFs have having. So BlackRock and friends, they now have over 300,000 Bitcoin. Okay, so ETFs now hold 1.5% of all Bitcoin supply currently in existence. And just a quick reminder, it's been less than 60 days since these things have been released. Right?

Starting point is 00:14:04 That's nuts. It's absolutely crazy. So let's go into a James Safert tweet here. He is looking at inflows. Record inflows, he says. What's this showing us? Yeah. BlackRock, Ibit, took in 612 million.

Starting point is 00:14:17 of Bitcoin on its own. The whole net group of all Bitcoin ETF took in $673 million. And then we had $216 a million of outflows from Grayscale. Still sizable outflows from Grayscale, but it's just getting completely overwhelmed by inflows into everything else.

Starting point is 00:14:36 And this was just in one day. This was one day. This is Bitcoin purchased by ETFs one particular day last week. That was February 28th. The amount of Bitcoin purchased by ETS was about 10,000. the amount of new Bitcoin issuance.

Starting point is 00:14:50 So that supply was 900. That's like a 10 to 1. 10 to 1. Yeah. Over 10 to 1. Yeah. Absolutely nuts. And then also this big old reminder, we are in like ending two of the full might

Starting point is 00:15:06 and power of the Bitcoin ETFs. So this platform with $30 billion in at Carson Group has been approved. It proved itself to offer the spot Bitcoin ETFs to its customers. And so Carson, like, who manages people's money, just allowed the BlackRock, the Fidelity, Bitwise, Franklin Templeton, Bitcoin ETFs to its customers. So there are wealth managers. There are platforms. There are brokerages that have not allowed their users to yet buy the Bitcoin ETF. And they are also allowing that to happen. That's going to happen like starting now moving forward. And then later in like, I don't know, ending four or five or six, there's actually going to be the sell side where like sales or where, where, where, where. people go like, hey, a client of mine, have you considered Bitcoin in your portfolio? Like, that hasn't happened yet.

Starting point is 00:15:55 Yeah. And that is a lot of money. What you're talking about is this kind of second inning. So like the first inning we've had sort of, you could buy it directly on BlackRock, you'd buy it directly in Fidelity. The registered investment advisors are now coming aboard. That's what the Carlson platform is. They are, you know, the Charles Schwab types of independent registered investment advisors

Starting point is 00:16:14 that advise, you know, retail dollars. Well, now they can. have exposure to these assets. They have the option to purchase these assets on behalf of their clients. Another one, just like that, David, which 10 times larger, Morgan Stanley says that they are evaluating spot Bitcoin ETFs, and they have just a massive giant brokerage platform. So the RIAs are starting to get involved, and that's going to unlock a whole bunch of capital. So the pipe, the bandwidth in this thing for liquidity inflows is just getting bigger. One other comment I'll say is like, I feel a little bit bad for some of those investors who are depending on their

Starting point is 00:16:50 registered investment advisor, right? Because like, they haven't been able to purchase this. Like, they've been front run by us, by crypto natives, even by the Black Rocks and Fidelity's for the world, not having the option to purchase Bitcoin, right? This is the case for why you should take some of your investment decisions in your own hands and not just like go with the flow and go with the system. When the crypto industry was really getting excited about the Bitcoin an ETF like November, December of last year, like Bitcoin was 26 to like $38,000. And so all of these institutions that are lagging their own customers' ability to buy Bitcoin are selling their own customers, $60,000, $70,000 Bitcoin.

Starting point is 00:17:29 This is why it pays to be bankless. Fragler on the opportunity. Touch the chain, you know? Like go into the deep end, you know, get your private keys. Anyways, I think Hunter Horsley said it best. Hunter Horsley from Bitwise, he says, there's just so much in the works with advice. and wealth platforms, Bitcoin is arriving, not in one week, but 2024 is going to be a great year. I concur. I concur. And I will say, putting on my ETH maxi hat, when the ETH ETF gets approved,

Starting point is 00:17:56 $1 into the ETH ETF is going to move the ETH price at least three times more than it would move the Bitcoin price because of how Ethereum market cap is one third the size of Bitcoin, at least. And that's base case because also there's much less ETH on exchanges because we have We have defy. We have Ethan Ave. We have Ethan Eichen layer. We have Ethan layer twos. And so like the ETH price movements are going to be like 3x is like such a bare case versus Bitcoin. It's going to be like five to five to like eight X times in price movements on one dollar inflows into the ETH ETF versus the Bitcoin ETF. Like I need to call a doctor sometimes when I think about this. So, so I think the market is just beginning to front run that, right? As they did, they started with Bitcoin. you know, like nine months ago, let's say. So let's talk about Ether on the week.

Starting point is 00:18:48 Where did we start? Where did we end? Up 19% of the week started at 2960, ending at the current price of, well, I wrote in $3,500, but prices have moved. Yeah, $3,430. Who knows what it will be tomorrow. So, ETHBTC, the ratio between Bitcoin and Ether down on the week. Well, this is actually the pattern that I've been noticing is that it's going down on week days and then it recovers pretty bigly on weekends

Starting point is 00:19:15 when the boomers can't buy Bitcoin. Like, the boomers can't buy unless it's outside of working hours. Why don't they? Why can't they? The ETH ratio has been going up. And so, like, I think, like, crypto natives have been, like,

Starting point is 00:19:30 buying ETH, you know, consistently, but it only is getting expressed in the ratio on the weekends. And then during the weekday, just, like, the massive inflows from Wall Street comes in, and then Bitcoin just, like, dominates everything. Like, Bitcoin dominance is up bigly right now. Yeah. I do agree, though, like, given the success of Bitcoin ETS, right?

Starting point is 00:19:46 If you just, like, kind of extrapolate that to Ethereum ETFs that have a decent chance of happening this year, right? That's going to be absolutely explosive. Let's talk about total crypto market caps, David. Are we above a trillion? Oh, wow, we are well above a trillion? What do you mean? Are we above a trillion? Sorry, I meant two trillion.

Starting point is 00:20:04 I've said that too many times. We are well, but, yeah, so we put on $400 billion in market cap in the last week. Bitcoin was 50% of that. Okay, so we are at 2.4, above 2.4, 3 trillion, Ryan, was the top last cycle. We're almost at this. So we're creeping on all-time highs for total market cap. We're almost at universal all-time highs. Yeah.

Starting point is 00:20:24 Okay. Let's switch over to layer two's. And this is a layer two update brought to you by Mantle, which is a new and upcoming layer two that we enjoy. So a total locked value is about steady and deep terms. $30 billion. $30 billion. Yeah.

Starting point is 00:20:38 No, we're crushing it. That's way up. Well, this is what happens when. I mean, ETH price goes up. Yeah, Eth goes up. Yeah, Eth goes up. Yeah. So we're actually flat in Eth on layer twos in Eth terms. But, you know, Eth is going up in price.

Starting point is 00:20:50 So therefore we cross 30. I'm almost at $31 billion. But also the scaling factor, Ryan, setting new all-time highs, especially with the area under the curve, which is like, you know, the significant thing. 8.8 Ethereum. So all layer two is are putting in 8.8 Ethereum's. So just a ton of scale happening up on the layer twos. And of course, we have Dengoon shipping to Mainnet next week.

Starting point is 00:21:11 I do actually kind of want to take a moment and highlight Mantle. I was talking with some of the Mantle team here at East Denver. So, like, there's all these different activities going on different layers because they're also, like, differentiated, right? Like, all the ZK roll-ups have so much transaction volume because the transactions are so cheap, Arbitronova, too, because it has the off-chain DA. Mantle, I think it's actually kind of like one of the more least understood chains, I would say, just because it actually has this crazy, like, Genesis story where the actual

Starting point is 00:21:39 mantle layer two was voted in by the mantle Dow in contrast to what the bybit exchange, which is where mantle came from once. The by bit, like some of the founders wanted to layer one, but then the Dow was like, we want a layer two. So they made a layer two because that's what happened. The real yield that you can get on mantle because they're subsidizing it from their massive multi-bit, like two plus something billion dollar eth treasury is some of the craziest yields in crypto.

Starting point is 00:22:06 So like M-Eath, the mantle native staked Eath, is getting something like 7%, but then some defy apps on Mantle are offering you 30% real ETH yield. Like, Init Capital is one of these native defy applications on Mantle that's not anywhere else.

Starting point is 00:22:21 Like Mantle also has, it's like kind of homegrown native defy ecosystem where like, you know, previously people are used to like AVE or something like the traditional synthetics like defy apps. But like Mantle's got its own like new defy applications kind of pushing the field in it being one of them. And you can get 30% real yield on your E, on your wrapped ether inside of Mantle,

Starting point is 00:22:45 inside of Init Capital. And that's in addition to the points that you can get from Init. I think like Mantle is like turning into like the yield chain. That's kind of kind of my like my takeaway from my conversations with the Mantle folks. They just want like all of the best yields to happen on Mantle. And like importantly real yields, not like pool two yields that we saw last cycle. I think that like the story of Eith Yield this cycle is. is huge. ETH productivity is a huge theme. Yeah, and I remember last kind of like a DFI summer, basically,

Starting point is 00:23:15 I think we're going to repeat something very similar to DeFi summer, except in kind of like restaking. We're already midway through that. I mean, just seeing how Eichnlayer is blowing up and all the restaking protocols are blowing up. Like we've talked about that before. But it's interesting this cycle where the source of yield is ether, the asset, primarily. Certainly dollars a little bit, but last time the story was all about dollar denominated yield. And now what you're talking about right here denominated yield. I'll remind everyone the disclaimer is like yield chasing is dangerous. So like when you go into some of these protocols, you see something. Yeah. You see 20%, 30% type yield, right? Like, make sure you understand the risks of that yield. Sometimes it's a smart contract risk, sometimes

Starting point is 00:23:53 it's economic risk. Sometimes it's like a counterparty like you don't understand type risk. So be careful chasing yield. But that's what the market's going to do this entire cycle. It's interesting that's Epe denominated this time. Lastly, to wrap up the market section, actually, no, we have a few more sections after this. Movers are the weak. Ryan, do you know what, in addition to Bitcoin or are the big categories of movers this week?

Starting point is 00:24:13 I'm looking at them, and I'm a little bit sad, actually. I see Rweb here, which I get that. That's like the whole AI plus crypto kind of thing. But then I see Pepe. I see Bonk, Dogecoin. Wow, retail is back. I will never fade a Dogecoin pump. Yeah.

Starting point is 00:24:31 This is cool. Uniswap, though. I guess we'll talk about that later on the episode. Yeah. Uh-huh. We're coming up pretty soon on that. We'll talk about that, actually, in the big news. All right. Yeah, rounding out the market section, Coinbase app was taken down by heavy traffic. This is as Bitcoin was pumping at a very, like, $3,000 in a single candle. Brian Armstrong tweeted out, we had modeled a 10x surge in traffic, and they also had load tested it. And then the traffic exceeded that number. It's expensive to keep services over provisions, he says.

Starting point is 00:25:01 but we need to keep on working on auto-scaling solutions and killing any remaining bottlenecks. Thank you for bearing with us. So, yeah, retail just like came flooding into Coinbase. Like, oh, yeah, Bitcoin. It's cool again. And then Coinbase crashed. And then, like, a bunch of Coinbase user accounts

Starting point is 00:25:14 started showing, like, a balance of zero. Yeah, that was scary. Freaked out. Yeah. And then Bitcoin, after pumping to, like, $64,000, dumped, crashed down to, like, $58,000. And then resumed up again. It's like, when we moved this,

Starting point is 00:25:31 fast, this quickly, just like volatility, it's just like back on the menu. Yeah, people were freaking out, though, when they saw the balance of zero in their Coinbase accounts and not entirely sure why that glitch happened as well. But look, it wouldn't be a bull market unless the Coinbase went down, right? Every single bull market I've been in crypto, Coinbase has been overwhelmed by demand, and that's always a bullish sign. David, speaking bullish signs here, Reddit, you know, they are about to IPO. I think we mentioned this on a previous roll-up. In some of their SEC filings, they mentioned this.

Starting point is 00:26:02 We invested some of our excess cash reserves. Of course, like any large company, they have cash reserves. They invested it in Bitcoin and Ether. On the corporate balance sheet, David. This is a continuing story that I think is going to be important, where you see, you know, Fortune 500, stock company, publicly traded companies throughout the world, investing some of their treasury into non-fields. sources like Bitcoin and Ether. Another thing they mentioned is, and we also acquired Ether and

Starting point is 00:26:32 Maddoch as a form of payment for sales of certain virtual goods. So not only did they explicitly take their cash reserves and put that into Bitcoin and Ether, just as a better store of value, you have to presume, but they also acquired Ether and also Maddoch in order to purchase block space in the future. It's kind of like a hedge for future space purchases. This is so bullish, I think. The fact that, like, I know this is just a trickle, but it's part of a broader trend where I think we're going to see more and more crypto assets on company balance sheets moving forward. Well, this was the big narrative of last cycle, remember? Like, this was the whole thing. Like, this is where the Bitcoin Treasuries website came about. Now we're just like starting

Starting point is 00:27:12 it all over again. It's easier to put Bitcoin on your balance sheet when it's inside of an ETF. Let me tell you that. I mean, all the best narratives are multi-cycle narratives because you get to a certain point and then, whoop, the tide, like, you know, comes back. And it. And then everything sweeps back and you have to restart. And now we're just picking up where we resumed. Eric Connor makes the point. It's Bitcoin and Ether. That's a difference this cycle.

Starting point is 00:27:34 Last cycle you said it was just Bitcoin. I think you're right. Now it's Bitcoin and Ether. And I think that's a little bit different this cycle. It always was Ether. Ether got onto corporate balance sheets last cycle too. And also, yeah, never mind. All right.

Starting point is 00:27:47 Moving up. Coming up next, Cracken reveals their side of the story with the SEC. Turns out the SEC was playing dirty. Gemini Earned customers are getting how much of the money back. We're going to tell you exactly how much. Talk of the uniswap fee switch has changed the entire sentiment around defy 1.0 and Blass has actually launched this main net and Lenz is now permissionless. This is like the best good news weekly roll up that we've had in like two years. So we're going to go here and from all of this good news. But first, a moment to talk about some

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Starting point is 00:31:00 And for bankless listeners and David, if you recall, so last we checked in on Cracken versus SEC, the SEC had filed a complaint, basically taking Cracken to court. What did the complaint say? They were basically being sued for listing securities. And of course, the SEC won't clarify what's a security. They think everything is a security. They think everything that is a token could potentially be a security. including many of the crypto assets that are obviously not securities anyway.

Starting point is 00:31:26 They basically charged Cracken with operating a cryptocurrency exchange because, like, yeah, of course they're, you know, exchanging, allowing the buying and selling of crypto assets. And they also charged Cracken with commingling. They included this in the complaint, basically an allusion to FDX style that they were commingling funds, which, you know, it turned out to be very much not the case. So this week they announced that they are filing a motion in court. to dismiss the SEC lawsuit. Not just fight against it.

Starting point is 00:31:56 They were saying, court, this is like a lawsuit that you shouldn't even consider because it's not worth considering a court system and they're filing for dismissal. On the backs of what they are actually revealing. And so that was the action that they were taking. But the reason why they are justifying why the court ought to dismiss the complaint is that the thing that they revealed is some backdoor shenanigans from the SEC. So in May, Cracken testified against the SEC's overreach about crypto before the House Financial Services Committee and the House Agricultural Committee. This is one of the hearings that we reported on way back when.

Starting point is 00:32:33 They testified that, you know, all the things that you've heard on bankless. Current laws do not adequately cover the digital asset industry. Congress ought to do more to place a better set of rules to protect consumers and investors. Congress should limit the SEC's jurisdiction in favor of other agencies, like all the things that we've been asking for Congress. and Crackett just went to the hearing and testify that, hey, we should, they think we should do this. And then the next day, the SEC called Crackett to say he was going to sue. And so it was just like the timing and the motivations are just extremely suss. It's like, okay, you guys are just suing us out of spite.

Starting point is 00:33:09 And the whole point about the SEC and how it needs to be reined in is because the SEC cannot do things that are capricious and arbitrary. Arbitrary and capricious. How many times have we said these words on the podcast? And so when, like, cracking has a very normal day at a hearing in Congress and they testify their opinions in a public manner. And then the next day, the SEC says, hey, we're going to, we're going to see you guys. It's very personal. It's very spiteful. It's arbitrary and capricious.

Starting point is 00:33:37 And so this was the information that we did not know that cracket is now, like, revealing to the public. And on the backs of that, that is their justification for why the court ought to just dismiss the whole entire complaint and tell Gary Ganser. to pack his bags. I mean, the facts here are kind of startling here, right? So Cracken tells Congress the SEC is overreaching, and the very next day, the SEC goes and calls Cracken and tells them they're getting sued. By the way, not the first time they were sued that year. The second time they were sued in 2023.

Starting point is 00:34:09 Completely caught Cracken by surprise because they had already resolved the first complaint. This feels like a mob boss scare tactic, David. And I mean... It's a, what do you call this? Extortion. Extortion. Cracken paid $30 million to settle with the SEC. And then the SEC is like, oh, I bet we can do it again.

Starting point is 00:34:26 Right. Absolutely crazy. So this is Jake Trevinsky here saying yesterday. Cracken filed a motion to dismiss the SEC enforcement action. The brief is a great read. We'll include a link to this in the show notes, by the way. Strong argument for why the SEC is wrong. And in the blog post, it basically accuses the SEC over retaliation for its testimony in Congress.

Starting point is 00:34:45 Wow. What is the judge going to think about this, David? That is pretty cringe from the SEC. Yeah. Cringe may be illegal. Yeah. We will see. But Cracken's not stopping there.

Starting point is 00:34:56 So not only are they fighting back about the SEC. They're also launching Cracken Institutional. So basically the whole like we're not effing leaving moves like SEC back off. And also we are launching further products to satisfy consumer demand inside America. So they're launching Cracken Institutional just to satisfy all the institutions out there. Hopefully not getting more ETH and Bitcoin on institutional balance sheet. That's what we enjoy. So just some big moves from cracking this week.

Starting point is 00:35:21 I think once you get the institutions on your side, then you have like a heat shield against the regulators, which is really what we need at this point. Yeah. Yeah, Gary Gunzer is not going to be happy. Nice job, guys. Nice job cracking. All right, moving on to Gemini Earn.

Starting point is 00:35:32 Gemini Earns will receive 100% of their capital back that they had in Gemini Earned. So a settlement was reached between Genesis and their creditors, which is Gemini Earned as most people. And so if you had lent one BTC, in the Earn program, you will receive one BTC back. This isn't some FTX shenanigans where you're getting 100% of your dollar-denominated value back when Bitcoin was like $20,000.

Starting point is 00:36:00 If you had one Bitcoin in Gemini Earn, you will get one Bitcoin back, which is literally the best outcome possible. Congratulations to all people getting their money back out of Gemini Earn. Bankless listeners will know I got scammed by some of the banks last year. Not a lot, but you know, I like to. test my Gemini urn. I like to test my block five, test my Celsius, right? So like, I was a beta tester for many of these things. So I was absolutely shocked when I received this email from Gemini earned saying, I thought it was like fishing. Did you think it was a fish? Yeah. Totally. So I went directly

Starting point is 00:36:34 to Twitter and I tried to verify from multiple sources. And yeah, this is the case. Now, there's one caveat to this. It's if the bankruptcy court approves this settlement in principle. So there's still a little thing to go through. But I mean, they should. The The hard part is making sure the money's there, and it seems like from this announcement, the money is actually there. So this would mean earn users can expect to receive 97% of their assets in two months. And that's in kind, as you said. So you put in ETH, you get back ETH.

Starting point is 00:37:01 So it was actually, they were short like $700 million when you look at the bottom, but they're giving back in terms of fiat value in assets like $1.8 billion, something like that. Because of price appreciation? Yeah, because of price appreciation. What are the odds that just like the forced holding of Gemini Earn customers actually made them net more money than they would have other high. Had they had it. They didn't sell the bottom. They forced hold the bottom.

Starting point is 00:37:29 Yeah. They forced held the bottom. And the worst thing is, is that they just didn't get the yield from Gemini Earned. They just didn't have any yield. That's the worst thing that happened. Have you seen this? This is a little bit of Sam Begman-Fried's argument from jail where he's actually saying like, hey, people are getting their money back. And it does seem like FTX depositors will make back their money, not in kind, all right?

Starting point is 00:37:52 Yeah, but like in dollars. That's not making back their money. Yeah, but he said, they will have less bitcoins. His filing is I should only go to jail for six years rather than like the, you know, like what, 20 plus lifetime. So he hasn't been sentenced yet, right? It hasn't been sentenced. So that's what he's, that's what he's like for. I wonder if the positive crypto price movements will actually like make his sentencing more lenient.

Starting point is 00:38:11 I wonder if that's true. Who knows? By the way, he's telling, I've read the story this. week, he's telling his prison guards to buy soul. That's what he's advising. I'm sure they're asking him, right? If you're a prison guard, you want to ask the crypto kingpin what to buy, and that's his advice from prison.

Starting point is 00:38:28 He's not financial advice, Sam Begman-Fried. All right. Anyway, so what's great about this Gemini earned, if it comes to pass, and it looks pretty, pretty secure here. Like Celsius, the folks from Celsius only received like 20 to 30% of their funds back Like not in kind, right? In like Fiat. So very little.

Starting point is 00:38:48 Mishinsky just like totally effed up and stole everyone's money basically. Mishisky was a scammer. He didn't have up. Zach Prince effed up. Yes. Sinsky was a scammer. Okay. Well, Zach Prince, BlockFi, we still don't know.

Starting point is 00:39:00 Block five people still don't know whether, how much they're getting back. But good news for Gemini earned and actually unexpected. David, let's talk about another thing that was unexpected is you know the fee switch we've been talking about forever for Uniswap, the token. Right? Like Unitoken value accrual could actually happen if we just turn the fee switch on. Well, it seems like there was news that this might actually happen. At least something that that spiked the price of Unitokin, something I haven't seen for like five, like three or four years anyway, 70% this week. Why? Why do we go up that high? So a Uniswap Foundation governance lead. So anyone can submit a

Starting point is 00:39:38 proposal to the Uniswap forms to turn on the fee switch. I'm sure that's happened. It's happened a handful of times. But when the Uniswap foundation, but when the Uniswap, Swap Foundation governance lead post the proposal, and it's a meaningful proposal with like actual thought out, you know, work being put into it. It means a little bit different. And so it would say it would, the upgrade would reward uni holders who have staked and delegated their tokens with the fee switch. So if approved by the community, the fee switch might just go ahead and turn on. Like as you said, uni went up from $7 to $12.5. One of the biggest pumps out of a token, a defy token I've ever seen. 70% is a big move.

Starting point is 00:40:14 especially for uniswap, because it's already had like a multi-billion dollar market cap. Okay, so like how much, if the fee switch was turned on, how much would actually go to token holders? So if you analyze the best recent months of fees and assume a 10% take rate on the fees, so like, what is it? What is the fee? The typical fee is somewhere between 30 bibs, Ryan, and 10 bips. And if you take 10% of that, that would be $96 million for the uni.

Starting point is 00:40:44 system for the UD system, which is not a great PE ratio. It's 120 price to earnings. That's really good. That's like less than Zoom used to be. Oh, yeah, I forgot. I forgot we're in a low interest rate era. This is, basically that PE is like a high growth tech stock, kind of like PE. Sure. Yeah. Yeah. Yeah. And then you can expect uniswap fees to like dominate this bull market just because that's what happens in bull markets. So like, annual

Starting point is 00:41:14 total fees is almost a billion dollars, but then the take rate of 10% would give them $96 million. What I love about this price pump is, it's nothing to do with memes. It's like fundamentals. It's like cash flow is going back to uni token holders. Yes. And then the uni price gets redirected. Yeah.

Starting point is 00:41:29 And what does this mean? The audacity of, again, this isn't the uniswap labs company, right? This is Hayden Adams & crew, but the audacity of a uny token governance to put this proposal through, right? How dare a Dow make their token a. cash flowing asset. I mean, Gary Gensler might be upset about this, but like, can he do anything? Will he do anything? I hope he is. Yeah, okay, so this had ripple effects kind of down the DFI stack. So FRAX also kind of put out this tweet talking in the tailwinds of the unipump. Should VEFXS holders,

Starting point is 00:42:03 that's like the FRAX token holders, vote to distribute revenue back to FXS stakers? FRAX makes eight figures of annual annual revenue being mostly converted into the treasury should it go back to the stakers. So now, like, if EutSwap is bold enough to turn on the fee switch for token holders, that has repriced a lot of the Defi 1.0 cash flowing, yielding tokens. And we've also seen like a price appreciation kind of down the market cap stack on a lot of D5.1.0 tokens. So this is part of the whole theme of this week, which is like winning begets winning. We're just like doing all the things covering up for all the things that were bearish in 2022 are now bullish in 2024. We're just doing all the things that we were suffering from. AVE, Synthetics, Lido, DYDX all up on that news on the week, which is great because without that, David, we do have just like, quote unquote, useless governance tokens.

Starting point is 00:42:56 We just have a whole bunch of memes. So this is what's interesting is the SEC, if they decide to weigh on this, is put in like a really weird spot, right? Like, do they want, like, it's better for uni investors to have cash flows or else it's just a meme token. Do they want to make, do they want to force all crypto tokens into memes? Or are they going to be okay with on-chain cash flows that are managed by like this decentralized community organization with immutable code on-chain, on-chain cash flows? Yeah, the actions of the SEC has incentivized capital to go into actual meme coins. Yes. because of the risks of actually being a real fundamental, valuable innovation that's tokenized.

Starting point is 00:43:39 And so this is the pendulum swinging back. Gary Gensler is like losing court case after court case. He's on his heels. People are getting bold enough to start to fight back. Like it's no coincidence. Like this goes back to Eric Wall Street at the very beginning. It's like this storyline, this arc, this poetry that is happening of like Cracken is going to give Gary Gensler an Uno card. Uniswap is turning on the fee switch.

Starting point is 00:44:02 Everyone is like boldness begets boldness and all of a sudden crypto's cool again and Gary Gensler looks cringe. Yep. Uniswop Labs as well. So this is again different than the Unswap foundation that controls the fee switch. But the centralized company Uniswop Labs is also continuing to build. So they just introduced the Uniswap extension this week, which is pretty cool. So this is like a browser extension and also limit orders as well are kind of like native to the app. browser extension actually i don't think sells it very well this is a browser sidebar so instead of like a

Starting point is 00:44:36 little pop-up like your menomasker rabbi this is like a little sidebar so it doesn't like overlap over your window it's kind of this persistent thing so we had that uniswap designer on the on the show a while ago and he's just a big fan of just like rethinking stuff and so this uniswap sidebar just think about like a module on your browser that is persistent and it's just like a wallet for your browser so the more web three our internet becomes, the more like nice, it's going to have to have a persistent module there. And so that's what the uniswap wall is. I can try that out. That looks really cool. I got to try that out. David, we got a lot more to talk about. The blobs are almost here. What's the effect going to be on the Ethereum economy? Also blast main net and Trump weighs in on

Starting point is 00:45:17 Bitcoin. Maybe he likes it now. We'll talk about all that and more. But before we do want to thank the sponsors that made this episode possible, including Mantle, the chain, apparently to get your yield. Go check it out. Mantle, formerly known as BitDAO, is the first Dow-led Web3 ecosystem, all built on top of Mantle's first core product, the Mantle network, a brand new high-performance Ethereum Layer 2 built using the OP stack, but uses Eigenlayer's data availability solution instead of the expensive Ethereum Layer 1. Not only does this reduce Mantle network's gas fees by 80%, but it also reduces gas fee

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Starting point is 00:47:37 And now Sello is looking to come home to Ethereum as a layer two. Optimism, Polygon, Matter Labs, and Arbitrum have all thrown their hats in the ring for the Sello Layer 2 to build upon their stacks. Why the competition? The Sello Layer 2 will bring huge advantages like a decentralized sequencer, off-chain data availability, secured by Ethereum validators and one block finality. What does that all mean for you? With Sello layer 2, gas fees will stay low and you can even pay for gas natively using ERC20 tokens,

Starting point is 00:48:02 sending crypto to phone numbers across wallets using Social Connect. But Sellow is a community governed protocol. This means that Sellow needs you to weigh in and make your voice heard. Join the conversation in the cello forums. Follow Sellow on Twitter and visit cello.org to shape the future of Ethereum. Ben Kuhn is just around the corner. Scheduled for Mainnet activation at Epoch, 29,600. at 96. That's March 13th for anyone who is a normal person at 855 EST. So if you run an Ethereum

Starting point is 00:48:31 node, you need to upgrade your node software because we have to upgrade for Dengoon. So that is your last PSA because the next weekly roll-up we have. No, two weeks. It's in two weeks. It's a 29th. We got basically two weeks until Dengoon, 12 days. Yeah. So that means the blobs are coming. And that's like a, huh, a weird way to describe what's happening. Like here's a reframe, sort of a nation-state economics reframe of it because I think people are really sleeping on this Ethereum upgrade. So on March 13th, Ethereum is actually injecting a massive stimulus into the Ethereum economy because it's cutting roll-up taxes by 90%. Okay. Roll-up taxes, the taxes they pay, that's what's actually happening. And if you look at kind of estimates, roll-up transactions

Starting point is 00:49:17 basically drop to something close to free, at least 80% of the roll-up transactions, until they 4x and then they start to become more expensive. So from my perspective, this is sort of like a Stimmy check in a way or like it's like a massive tax cut to a sector of the Ethereum economy. It's a massive tax cut

Starting point is 00:49:36 to the Ethereum economy in that way. It induces demand in the way that a tax cutting economic stimulus would. And to me this is already fuel on like what is already a bull market economy and yeah. I'm

Starting point is 00:49:52 I'm pretty excited. I think people should start reframing it in terms of like the protocol is doing this thing that's going to, um, like, induce more demand and cause increased economic activity, because that is actually what's going on. I think blobs undersells it because no one knows what the F-a-Blob actually is. And we got to translate this into Normie speak and get some economists to start speaking this language for like macro updates. Okay, so here's how I'll frame this. So Ethereum, the layer one is Manhattan, right? It's expensive. The Ethereum, protocol has improved the subway, the railway lines that go to Brooklyn and New Jersey and upstate. It is now cheaper and faster to take a train to go to the suburbs, which means that

Starting point is 00:50:36 it's easier and more accessible to live in these suburbs. The suburbs are now a better place to live and they're better connected to the Ethereum Layer 1. And that's just because the cost of the blobs where Layer 2's put their data are going down. It's basically a subsidy for layer twos. You're being very bullish about just like the prices going down on layer twos. And I think that's going to be a blip. I think transaction feeds are going to go for a very short amount of time. They'll go to drop to zero. But it's going to be like under for under a week, maybe even under a day. And then they're going to come back up to more or less about where they are now, except we will see a lot more total activity on on Ethereum layer two's.

Starting point is 00:51:17 I think the thing that is going to really benefit the most is going to be the PNL. of the major layer twos. So you're going to see Arbitrum is just way more profitable. Optimism is way more profitable. Their costs are going down and their total volume is going to go up. Yeah. I mean, basically, they get something close to free transactions or massively reduced transactions until they all collectively 4x.

Starting point is 00:51:41 That's how much net new bandwidth we have, which is... I just think they're 4xing very quickly, is what I'm saying. Yeah. I hope they do. More economic value created. Speaking of that, Blast has already reached two big. billion in total value locked. And apparently they just went mainnet.

Starting point is 00:51:56 So that is as of today, the day of recording. As of today. What if folks need to know? 150,000 wallets with $2 billion in TVL. I think Blast has kind of gotten, it has left a bad taste in its mouth for just the way that it launched. It's very controversial. And as a result of that, I kind of think people are under-indexing.

Starting point is 00:52:15 Actually, the technical merits of Blast. I was under-indexing on it. I thought, I was like, what's the point of having Native Weald when you can just use Lido Stake Death inside of like your normal chain. But apparently, allegedly, something I'm looking forward to seeing is that when you actually put native yield

Starting point is 00:52:30 into the protocol, it actually does unlock a design space that's unique. That's different than just like steak teeth. Is this still a multi-sig though? Probably. I'm going to guess it is. Yeah. Well, you still got that. So I guess staker beware. You know, yield seeker beware with that.

Starting point is 00:52:50 But I mean, it's cool to see. another experiment going on here. Yeah. Something else that's exciting is Coinbase has released their report, their Coinbase Cloud report about the composition of the Ethereum network on the execution layer. So this came after we had a bug in one of the execution clients that was the minority client. And then the whole entire Ethereum community was like, well, if that was Geth, that would have

Starting point is 00:53:10 been really bad. Yeah. And Geth has had this really high, strong dominance at 82%. It's come down to like 78, 77%. Still too high. But Coinbase just released their, just to end. announce their future plans to shift 50% of their validators, which are 100% guess to Metamine.

Starting point is 00:53:28 So they're doing a 50-50 split to Nethermind. And then they also said that they intend to support Aragon in the future another client. Perhaps that means they will do 33, 33, 33. And then they also said that they're keeping an eye on Reth, Russ Ethereum, which Georgia is from paradigm is pioneering. And so basically it's a commitment to truly balance out equally all of CoinBenzheny. is validators to materially diffuse the concentration

Starting point is 00:53:56 of Ethereum's execution claim. I mean, that's great. Just perfect. That's in the best interest of Coinbase. That's in the best interest of Coinbase stakers. It's certainly in the best interest of Ethereum. So at post those changes, how low would this drive kind of like Geth? Would it bring us below kind of two thirds?

Starting point is 00:54:11 That's kind of where we're trying to get to, right? Yes. Once Coinbase moves 50% of their validators from Geth to Nethermind, Geth dominance will be below the critical threshold of 66%. And a reminder, Ethereum is the only multi-client layer one that exists. So, like, this is one of the biggest weaknesses of Ethereum is that we have, like, concentration in Geph, which is getting removed post-coin-based migrating. And every other layer one is a single client ecosystem.

Starting point is 00:54:38 I got to say that is very eth-maxy of you, David. That's so ethmaxy of me. Some more big news this week. Lens Protocol, which is the social protocol built on top of crypto, primarily Polygon, is now permissionless. So anyone can create a profile on lens. Lens is pretty similar to Farkaster in some ways in that it's kind of like, uh,

Starting point is 00:55:00 so it's a more chainy farcaster. Yeah. Yeah. There's more stuff happening on Polygon, but you know, it's kind of like decentralized identity. You kind of own, you have your own property rights with respect to anything, any messages that you send on it, any tweets that, that you make or I guess I'll call them tweets, but I'm not sure exactly what they're called in the Lens Protocol world. It's really transactions, I suppose.

Starting point is 00:55:24 There are now 125,000 users. There have been almost 40 million on-chain social transactions, including 5 million posts. So a lot of activity. And that activity is kind of spread out across clients. You know, right now, Farcaster has just one central app, which is Warpcast. They're hoping that more apps kind of spin up over time.

Starting point is 00:55:44 Lens hasn't really built its own central app internally. It's kind of like the community, a bunch of startups, entrepreneurs are kind of developing these apps. So it makes it, I guess, a bit more decentralized from that perspective, at least at the kind of the app layer. But also, there's not really a shelling point that I found for Lens yet, right? There's not like a warp cast of one central place to go if you're trying to do something

Starting point is 00:56:08 on Lens. But the big question is, how will Lens and Farkaster, you know, compete? Because we are in the very first innings, the beginnings of Social FI. Do you want to explore that a bit more? we'll drop a link in the show notes to a fantastic article we published on bank lists this week from William Pister, kind of comparing Lens and Farcaster, how to get started, how they're similar, how they're different. And I would encourage everyone to go check out socialify, go check out Lens, go check out Farcaster,

Starting point is 00:56:35 this bull cycle. I think there's going to be a lot of activity happening in these platforms in this bull market. It's a good time to check them out. Next in news, Robert Leshner and his Super State Fund has introduced their Ethereum-based short term United States government securities fund. That was a mouthful. It's basically tokenized treasuries. Short term treasuries. So you get the yield of a treasury wrapped up inside of a stable coin. So this is part of the whole real world assets phenomenon. This is the first fund out of Robert Lesher's new super state, which they, I think, plan to just tokenize a bunch of stuff.

Starting point is 00:57:12 So what does the fund do? Invest in short duration United States Treasury securities. And then which targets the Fed funds rate, and so it yields something close to the Fed's funds rate, and then Superstate takes a 0.15% 15BIPs management fee. So cool. Congrats to Robert Lesterner for getting that out the door. To tokenized, I guess, like a tokenized treasury. That's what we're trying to get to here. That's regulated in the U.S.

Starting point is 00:57:38 David. Some new Satoshi Nakamoto emails were made public this week as a result of, I believe, a court case. But people are pouring through the findings here. So here's a thread from Pete Rizzo going through some of the findings. And I don't think anyone has seen these, at least publicly, seen these emails before from 2009, the very genesis of Bitcoin from Satoshi Nakamoto, the pseudonymous founder of Bitcoin. Was anything interesting here to you? I haven't parsed through these emails. I'm kind of letting the Bitcoin historians do that work.

Starting point is 00:58:12 And I'm sure they're going to surface some of the best stuff. I think a big theme was Satoshi's interest in what would be categorized as like big blocker philosophy, like increasing the block size, increasing throughput. He definitely saw Bitcoin as like a high volume visa competitor. And so everyone is like, oh, Satoshi was a big blocker. I don't really think that that matters personally. Satoshi left to allow Bitcoin to grow on its own. He understood that Bitcoin was like a child that was.

Starting point is 00:58:44 going to grow up. I don't think Satoshi's opinions, I don't, I don't elevate Satoshi's opinions to like God status, but like some people like to like to do that. It's almost like a religious text for some people. Yes. So basically this is what happened. It's like the Bitcoin historians are like parsing through these ancient scriptures that were just discovered in like a tomb, which was the emails of like Craig Wright and whoever like this legal legal case was. And now people are parsing it. I think the funniest one, Ryan, is that Satoshi was a big fan of how. lopeno pineapple pizza. Really?

Starting point is 00:59:16 That was revealed, yeah. So Satoshi is a pineapple pizza person. Well, what does that uncover about who Satoshi was? So anything like this, it drops. And there's always another fervor of speculation in terms of who he was. And including this Reddit forum, the leading candidates are generally these three that I typically see. Nick Zabo as a possible candidate.

Starting point is 00:59:37 So Nick, he's gone dormant. I haven't heard Nick speaking about crypto in a very long time, but did some early post. is still alive. How Finney, who passed away in 2014, he's a cryptographer, and Len Sassiman, so he took his life, committed suicide in 2011. So it's always interesting to, I find it fascinating to read up on just the speculation of who Satoshi was. Do you think it actually matters? I don't think it matters, and I kind of think we, Satoshi left. He left, he wanted to disappear, he needed Bitcoin to grow up on its own. I think speculation on who Satoshi is is fun. But also, like, it also has real consequences.

Starting point is 01:00:16 Like, Nick Zobbo's wife, who's still alive, has, like, been harassed on the potential of fact that, like, she might have private keys that she doesn't know about hidden in her house somewhere. Wow. Really? Yeah. And so, like, in the Bitcoin community, there's definitely, like, a repression of Satoshi speculation because it impacts the safety of the people being speculated against because there's, like,

Starting point is 01:00:38 you know, the 0.01% of the population who's, like, deranged and will do something crazy. As long as those keys stay locked forever, I, you know, like... I think they're burnt. I think they're gone. Yeah, I tend to think that too. I mean, we're 15 years old. If Satoshi had the spirit to leave and disappear, he also had the spirit to burn his keys. Or maybe he's waiting for one million Bitcoin.

Starting point is 01:00:58 He's going to sell a market dump at all. Could you imagine, bro? Oh, wow. Oh, my God. David, Avalanche was down this week. I don't know if you saw that, but the... Layer 1 network, Avalanche was down for a good number of hours. Five hours. Five hours. There you go. First outage this year.

Starting point is 01:01:19 This is what happens when you don't have a multi-client layer one. Wow. Some would call that grave dancing. Not me though, David. I think you're just important lessons about how we know that you need multi-client systems. This isn't grave dancing. This is what happens when you don't have multi-client systems. David, let's talk about a tale of two politicians. So is this Donald Trump saying something good about Bitcoin? I didn't know. he was favorable to Bitcoin. Everything I've ever heard this man say has actually been opposing Bitcoin, anti-Bitcoin and propping up the dollar. But here he is on Fox News. Let's play this. Something that you haven't talked a lot about. You came out strongly against the central bank

Starting point is 01:01:56 digital currency, which would be a government-controlled digital dollar. China obviously has its own push into the Chinese digital currency. But isn't the next logical step for you to embrace Bitcoin? Because Bitcoin, obviously, is decentralized. The government can't get its hands on it. What about Bitcoin and all the young people, including African Americans who are very interesting. Well, a lot of people are doing it. I always liked one currency. A lot of people are doing it. I like the dollar.

Starting point is 01:02:21 But a lot of people are doing it. And frankly, it's taken away from itself. I like the dollar. As you know, but many people are embracing it. And more and more I'm seeing people wanting to pay Bitcoin. And you're seeing something that's interesting. So I can live with one way the other. I've always liked one really powerful thing.

Starting point is 01:02:41 and that's called the dollar. Yeah. All right. There you go. Dollar maxi, confirmed. All right. He doesn't hate Bitcoin. He doesn't hate Bitcoin.

Starting point is 01:02:50 I love how everyone's clapping. He's like Donald Trump loves the dollar. Go dollar. It's great. David, here's that. All right, but that was a big Overton window shift for Trump. Yeah, I will say that. All right.

Starting point is 01:03:02 Has Elizabeth Warren changed the tune? Let's hear from her. There's another contrast clip this week from Elizabeth Warren. I want to collaborate with the industry. What I don't understand. She's talking about the crypto industry. It seems to be saying that the only way that they can survive is if there's plenty of space for the drug traffickers and the human traffickers. Human traffickers.

Starting point is 01:03:25 Oh, and the terrorists and the ransomware scammers and the consumer scammers and the rogue nations, North Korea, that is financing about half of its nuclear missile program with crypto, that all of that has to be left over. Okay, that last one was true. In our financial system, pretty much everybody follows the same set of rules. I'm talking banks and credit unions and credit card companies, gold traders and stock brokers, private equity now has to follow the rules, precious metal dealers, Benmo, Western Union, but not crypto. My view of the world is same kind of activity.

Starting point is 01:04:11 same kind of risk should have the same regulation. I'm not looking for fancier regulation for them. I'm not looking for anything tougher for them. I just want to level playing field here. Not a big believer in DFI. And when it comes to a level playing field,

Starting point is 01:04:27 I think DFI being able to have your own private keys and use this in an open financial economy, the way that we communicate on the internet, that seems like that is leveling the playing field. But I think she wants to make us all all of our apps, all of our validators, all of our activity, subject.

Starting point is 01:04:46 She wants to make us all banks, basically, which not a big fan of Defi, I think, from Elizabeth Warren here. She opened up this clip saying, what I don't understand is why the industry, that's us, seems to be saying that the only way we can survive is if there is plenty of space for the drug traffickers, the human traffickers, the terrorists. Oh, Ryan, who's saying that? I don't think we say. I have not said that. Are we saying that? No. Is anyone that we've ever had on the podcast saying that? Can she point me to the person that said that?

Starting point is 01:05:18 So like I sent this clip to my liberal family and I just dropped this bomb in our our family text chat and I was like, oh, so your guys, your girls live with Warren's just like making stuff up now. Great. They haven't woken up yet, but we'll see. Yeah, David, let me know what your family says. You know, I don't know if you're going to have an awkward Thanksgiving ahead, but I'm hoping the best. It's a political year.

Starting point is 01:05:42 What are we going to do? David, tell me about the meetup. I couldn't make it. Eat Denver. Bankless citizens were there at a party. Bankless meetup in person. These are some of the photos.

Starting point is 01:05:54 Fantastic. Yeah, it was great. It was great. So I facetimed you for like 10 seconds. Yeah, who was I talking to? Oh, just some bankless citizens. Oh, cool.

Starting point is 01:06:02 Because they, every time it's like we get through some of the, they're like, oh, like, thanks for doing the podcast. I appreciate what you guys do. is Ryan here? And I'm like, guys, no, Ryan never comes. He's never here. So you just dialed me. We could face-time him. So I just fac-timed you. Yeah, I couldn't hear anything because it was too loud. Yeah. I saw him. These are always, these are always some of the best events. The bankless community is always just like some of the best people. Tons of previous podcast guests were there. Like Kevin O'Walky was hanging out. Um, Micah Bolito was there for a little bit. Uh, just a lot of good old fam, you know, the fam's all in town. It was great. Um, I had, I had three beers.

Starting point is 01:06:35 I got very loose. It was lovely. Bankless Nation is fun to hang out with. That's when you have some of your best ideas, I think, when you got a few drinks in you. You're talking to me about some breakthroughs in terms of understanding of Eigenlier last night, I think. I received these texts in the middle of the night. You did not receive these texts.

Starting point is 01:06:57 I saw it in Discord. I have, inside of the Bankless Discord where we run the company, I have a channel called David's Room that no one is allowed to go into except Ryan's there because he's also a moderator. I don't know. And I'm having some like ideas, you know, some like, you know, alcohol aided inspiration.

Starting point is 01:07:15 At one in the morning. But I didn't remember these things because my, it was at one in the morning. Well, one in the morning, your time. It was like 11th at my time. I just find it funny. And so I like, you know, right out, like got to write the nose because I'll forget it.

Starting point is 01:07:24 And so I sent them in the discord. Then Ryan is like, oh, sweet drunk text. Yeah. They weren't to you. When David drunk text is going to be about Aguadley or something. And I'm here for it. It's great. All right.

Starting point is 01:07:34 Let's flip to you raises of the week, and these are some raises we mentioned because bankless ventures is part of them, so it's partially a disclosure as well. Bounce Bitt raised six million in seed funding. What is Bounce Bid? All right, so this is actually kind of a funny one for bankless ventures to invest in because of two reasons. Number one, it's like Bitcoin-centric, which is interesting for bankless, and it's also banked. Okay, so what Bounce Bitt is actually DEM-Bed. Mostly-banked. Mostly banked. Mostly banked. There's over, did you know, David? I think you did know, actually, but I'm going to ask you like you didn't. There's 700,000 Bitcoin right now in Binance custody solutions. So just inside of Binance. So this is bank Bitcoin. It's held in the custody

Starting point is 01:08:15 of finance. And there are, there is some segment of people that for whatever reason, they still trust custing in their crypto exchange. You know, I understand why to some extent, but, you know, like maybe they can't handle their private keys. Maybe they're an institution, something like this. What BounceBit does is it basically takes that Bitcoin and allows you to use it on a side chain in Defi type protocols. I put Defi in air quotes because the entire thing is custody by Binance. It's fully banked already at some level. Importantly, it is a BTC-centric consensus solution, not a blockchain, not a Bitcoin to the blockchain. And so it is like it's kind of like a proof of stake using the custody Bitcoin.

Starting point is 01:09:00 Yes. And so they're going to create kind of an open finance ecosystem where you can do collateralized lending and borrowing and trading and all of these things on top of the bank held in custody, finance Bitcoin. And so there's a lot of this. I think that's an okay interim step for Bitcoin until it has like fully like on chain layer twos. And by the way, they're getting there with actual defy. So this provides a source of yield for Bitcoin that wants to be a expressed in an open finance community and for people that are fine cussing their their Bitcoin with Binance. So that's what Bounce Bit is all about. Yeah. This definitely falls into the category that I've seen emerging very, very strongly, which is all about BTC productivity. Like, how can we make Bitcoin more productive? There's like a flurry of Bitcoin layer two deals going on, all kind of ahead of the BitVM and also another innovation that I was hearing about here at ETH Denver. There was a Bitcoin Renaissance Day here at Eith Denver that was unlocking

Starting point is 01:10:02 proof of stake in Bitcoin where like instead of slashing what would happen, Ryan, is like if you violated consensus, your private keys would be revealed and anyone can just like take your bitcoins from you. Which is like basically slashing. They have to do this because they're not fully expressive.

Starting point is 01:10:17 Like they get like it's limited. That is their version. That is their version of proof of sake. And so basically Bouncement is taking kind of the polygon strategy like the prologan proof of stake side chain before they have the Polygon ZK EVM, just bootstrapping the chain, getting the TVL, getting the developer ecosystem, and then once the Bitcoin Layer 2 ecosystem actually manifest at a technical level, because it's still kind of in the research phase, but people are betting on its future, then Bounce Bates has plans to actually, you know, choose a solution

Starting point is 01:10:47 there. But also fully EVM compatible. So all of Ethereum, the Ethereum ecosystem is able to be expressed on BounceBit. Yeah, we'll be good as long as finance doesn't rug. What else? We got Etherfi raised 27 million. This is in the restaking class and Bankless Ventures was part of that as well. A remind us what Etherfi is. It is a liquid restaking token. It is one of the like you said, the eigenlayer ecosystem deals. It is the number one liquid restaked token by ETH deposits into Etherfi. I think they're at 1.5 billion right now. They were at the bankless meetup last night. So I was hanging out with the guys there. David, we're also hiring by the way. Got to add the jobs board. We have not talked about the jobs board in a very long time, but we have two open positions. One is a senior product designer at bankless. The other is a growth marketer because bankless is growing. So if you're interested in those positions, go click the link in the show notes and apply.

Starting point is 01:11:41 Be very excited to hear from me. Biggest job in crypto. David, meme of the week. You ready for this, man? Yeah. Yeah, I'm ready. All right. So this is a meme from Greg.

Starting point is 01:11:50 Got an enormous amount of likes here. Don't forget to report. It's not a meme. I should say. This is actually a true story. don't forget to report your income from illegal activities and stolen property as you're doing your taxes this year. Okay. It's tax season for everybody. It's an absolute nightmare in crypto. Did you know that if you go to the IRS website, the IRS actually make sure that you know. You must pay taxes on your income from illegal activities and stolen properties. So here, on the IRS website, you go look this up. They say, if you steal property, you must report it's fair market value in your income in the year you steal it. unless you return it to the rightful owner in the same years. So, David, if you steal something, the last year, if you stole something in 2023,

Starting point is 01:12:34 now's the time to report it to the IRS. If you pay taxes on property that you steal, I feel like you own it. I feel like that's yours then. I don't know why they would expect a thief to comply with this, but I'll thank you, IRS. David, you got a moment of Zen for me, right? Yeah, I do. It is completely unrelated to crypto. It is an internet.

Starting point is 01:12:56 It is a great internet. story that I'm tracking, but it has nothing to do with crypto. So if you want to move on to your next podcast, yeah, another bankless podcast, of course, go ahead and feel free. Otherwise, I'm going to tell you about a funny internet story. But first, Ryan is going to tell you all about the risks of going bankless. Yeah, I got to end with this. As we always do, of course, crypto is risky. It doesn't seem like it on weeks like this, but I guarantee you, what goes up can come down. You can lose what you put in, but we are headed west. This is the frontier. It's not for everyone. But we're glad you're with us on the bankless journey. Thanks a lot. All right, David, tell me.

Starting point is 01:13:26 about this moment of Zen. Give me, give me the story. Reid Harrington. Does that name strike a bell? No. Who do I know Reed Harrington from? Yeah, he's a seventh grader living in the United States. He goes, okay, when I hit 200,000 followers, I will do whatever the top comment said on this video and post it.

Starting point is 01:13:47 Wow. He did this in a relatively unfollowed Instagram account. And so the top comment which went viral through Instagram, the top comment, which broke the Instagram record of 2.57 million likes. Came from this user 59 kid who said, fly to a small town in Thailand, get accepted by their people,

Starting point is 01:14:09 learn the language, train Mai Tai for a year and a half, fight in a terminate, win the tournament, return to the USA, join the UFC, stay in shape and go undefeated in your weight class, retire,

Starting point is 01:14:21 and do an interview saying this comment was the reason that you fought so hard. Wow. This, Reed Harrington on his Instagram now has 750,000 followers. So now he has to do it according to his commitment. And there was a go fund me for $15,000 set up to fly this kid to Thailand. Wow. So he can go train Mai Tai in Thailand.

Starting point is 01:14:47 That's just step one though. That's just, yeah, he's at the very beginning of this arc. The crazy thing is, is like the tourism authority of Thailand has made it statement saying that they are ready to take care of him and his dad when they come to the country. And so this kid has been posting him every single day practicing Mai Tai on his Instagram. Yeah. Because he's going to go to it. And it's like, we're just at the beginning of this arc.

Starting point is 01:15:12 But like, so far, so good. And if the internet wants this to happen, the internet is going to make this happen. So long as his kid is ready to commit. I guess the entire internet is cheering read on then, right? This is like a, it's a multi-decade. here. He's just, I guess, signed up for? He's got his dick's five years of his life planned out from this one Instagram comment. Well, you know what? I guess letting the internet decide your fate, not so bad in some cases. That's incredible. So like we're going to keep tabs on him like every

Starting point is 01:15:43 year or so. We'll check back in with Reed Harrington and see where he's at. You got crypto prices and Reed Harrington, guys. This has been the moment of time. Take care.

Bankless - ROLLUP: Bitcoin ATH's In Sight | Coinbase Crashes | Blast Mainnet Live

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