Bankless - ROLLUP: Bitfinex Hack | Super Crypto Bowl | Aave Social Network | Vitalik Supports Assange DAO

Starting point is 00:00:00 It's hard to be bearish-eath above 3K, in my opinion. Congrats, the three-week bear market is. Oh, moving. I'm not saying. You can't say it. It's over this week. We'll see what next week. We'll see what next week brings.

Starting point is 00:00:16 All right, guys, it is the second week of February. David, what time is it? It's the Friday bankless weekly roll-up time, Ryan, and this one is going to be a doozy. This one is going to be like two hours long. So much crazy stuff happens in crypto. And I don't even know where to start. So many things have. happened in like every single different sector. We got Bitcoin stuff to talk about. We got exchange

Starting point is 00:00:38 hacks to talk about. We have social dynamics to talk about. Like the amount of NFT things that are happening is absolutely insane. Oh my God, where to even start. Well, we could start with the world's worst crypto bank robbers. That happened this week. Okay. There was an FBI bust, a hilarious story. All right. This should be circulating on late night. It's that funny. So we're going to talk about that $3.6 billion heist and it caught up with them. heisted by insane people by lunatics. Lunatics robbed a bank. Stay tuned to the roll up just for that story.

Starting point is 00:01:11 It's worth it. Also, Apple Tap, you can now pay via crypto adoption. BlackRock is getting into crypto as well. The world's largest asset manager, I believe. They're finally coming to crypto. Gucci buying some land. Where? In the Metaverse. And the Crypto Super Bowl.

Starting point is 00:01:28 That's what I'm calling it, David, because I think we're going to be inundated by crypto Super Bowl commercials. And I might just watch the Super Bowl for that. I don't know if you're watching it. There's a bunch of predictions about like, all right, which NFT projects are making it into the Super Bowl? Are bored apes going to make an appearance? What will happen to prices? What's Budweiser going to do? Yeah, right. Like, yeah, people are playing that game right now. Yeah, it's going to be fun. Guys, a lot of things. But first, we want to tell you about a couple of announcements. The first is this, David, it's been a long time since we talked about bankless premium membership and we appreciate our friend Hardison underscore CJ on Twitter tweeting this out,

Starting point is 00:02:05 how I felt listening to Bankless HQ Premium Feed episode. Top secret, you know, the Bankless Premium episode, David, we're putting some awesome content out on that. And I think if you are not a premium subscriber, you don't have access to that. But it's a whole podcast that you don't get. It's a whole extra bankless podcast that comes at you. In addition to podcasts come early at you on the premium feed. There's a lot of other benefits to you becoming a subscriber.

Starting point is 00:02:30 Anything else you want to mention? Yeah, in parentheses, coffee mug with the semiconductor for the win at Trustless State. What the hell does that mean? Well, bankless premium subscribers definitely know. And so the debrief episodes are where Ryan and I just reflect on the episode that we just recorded prior and just kind of capture and connect that to other existing knowledge that we think that we have about the rest of the crypto space. So some alpha question mark. Yeah, also, you get a nice premium badge, NFT badge for 2022 when you sign up and you get some extra.

Starting point is 00:03:05 Unlocks things. Unlocks things. Maybe things that are coming in the future. You get yield guides, premium access, lots of good benefits there. Also, David, we should talk a bit about our friends at Zirion. This is not my wallet, but it's a wallet I would like to have. And what's cool about Zirion, of course, is this gives you one-click access to your entire D5 portfolio across chains. So it's no longer just about Ethereum mainnet.

Starting point is 00:03:30 Now we're looking at some layer two chains here. So we're looking at optimism. We're looking at Avalanche. They're adding more networks over time. So I think they have seven already listed. And a major theme for this year has been the great migration from L1, Ethereum to layer two. And you can bridge within Zirion as well. Take a look at these bridging functions, David.

Starting point is 00:03:52 Bridgeor. There are so many different bridgers out there. there are so many different destinations out there. Zirion supports seven different chains, but all inside of just one Zirion application, in addition to all the bridges that can get you onto those different chains. So sometimes I get caught up in choice paralysis,

Starting point is 00:04:08 like do I use Hop? Do I use Kinext? Like, do I use... Where do I go? And so Zerion can just make that super simple for you, all in one place, and that is the power of Zirion. Blockchains belong in the back. And Zirion puts itself in the front,

Starting point is 00:04:23 so you don't have to deal with the block. blockchain. Just use Xerion. NFT viewer too. It's really it's all your assets. So connect your wallet, start using Xerian, hop across some bridges. We'll include a link to the show notes so you can do that. All right, David, markets time, man. Bitcoin. Bitcoin, baby. Where's it going? We're up. Happy about it. We're happy about it. Yeah. Bitcoin started the week at $36,600, which was also the low. And it is currently clocking in at $45,000, $45,000, 250, which is also the high. So start at the week at the end of the week at the high, it's the best possible outcome. We're real happy about it. So up 20% this week, Ryan. How about Ether? What's Ether doing? Yeah, Ether started the week at $2,600, currently at $3,212.

Starting point is 00:05:10 The high is $3,280, so almost currently at its high, up also roughly 20% on the week. Almost as much with Bitcoin. Bitcoin did win the race this week. I think Bitcoin is up like 1 to 2% more than Ether this week. That's pretty impressive. And I think, I feel like it's getting rid of those bull market blues. I feel like the market is moving squarely into like neutral territory. Like we're not sure what comes next, but we're no longer as bearish. It's hard to be bearish, Eath, above 3K, in my opinion. Congrats the three-week bear market is.

Starting point is 00:05:42 Oh, I'm not saying. You can't say it. It's over this week. We'll see what next week. We'll see what next week brings. But yeah, it's definitely looking good on this pop back up. How about the Eith Bitcoin ratio? how's that looking down just a little bit down i think it was at 0.074 last week it's currently at 0.071 so down a

Starting point is 00:06:02 little bit um no not too much action there bed index as usual is tracking all of these assets so this is what it looks like on the one week it is up about 7.3% this is of course bitcoin ether and defy also if you want to get in some more risky i i guess a bit higher risk and reward defy assets we have the bankless defy innovation index. This is the GMI token. Going to make it. It's an index of all of these like defy 2.0 protocols. And in addition to the DPI, this is a pretty good tracker of what DFI is up to. And it doesn't look great on the month, of course, like anything. Looks pretty good on the week, though, up 10% this week. It beat bed on the week. Yeah. So newer Dify tokens, more experimental defy tokens, more on the frontier DFI tokens, more upside if things go well.

Starting point is 00:06:53 more downside if they don't but this week it beat out the bed index so the bankless GMI index which has a much the bed index only has three assets right but I guess DPI has many many many the bank this GMI index has a much larger number of assets in it things like Tokomak things like OM a bunch of the newer like DFI 2.0 type stuff and so if that is your cup of tea go check that out at the index co-op application another thing to check out is the growth stats on Maker. They just passed 10 billion die.

Starting point is 00:07:27 Yay. It's pretty impressive. You don't have your soundboard so you can't click the applause. It was manually doing it. That's 10 billion die. That's 10 billion dollars of non-blacklistable stable coins, which is a really important point. Die does not have a blacklist, and there's 10 billion

Starting point is 00:07:43 of them out there. I would like although I will say, you know, the USDA or anything that's centralized that is backings in the collateral of Maker could be blacklisted. But that's, you used to be higher percentage. Now it's slower, right? And it's, you know, it can be adjusted up or down based on, based on that. But that's what the, that's what the maker contracts do. It takes risk into its contracts and it outputs this unblacklistable stable coin. So it's supposed to be a risk

Starting point is 00:08:08 filter using the strength of the MKR market cap and also kind of security through like mingling, right? Like, and so I think it's a fair take to say that like even though that USDC inside a maker vaults is blacklistable, the dye on the other side of that is still like has strong security properties. I agree with that take too. And I do think that blacklisting is yet another risk that Maker sort of tries to abstract and, you know, take away from from die. But what's cool about this is 10 billion is a big number. David, I remember one of our early bankless podcast episodes, maybe the first 10, the first doesn't anyway, with Mariano Conti. This is back in 2020, I think.

Starting point is 00:08:52 And he gave out a number that blew people's minds at the time, blew our minds at the time. Dye was like under $100 million, if I'm remembering correctly. And he gave this crazy prediction that by the end of 2020, Dye might hit $10 billion. Sorry, not $10 billion, $1 billion. And now here we are at $10 billion. It's pretty crazy. The market cap, the supply of Dye at that time was roughly $50 million.

Starting point is 00:09:19 So asking for a $1 billion supply was insane. Now we're at $10 billion. It was. It was at the time. And Maker, MKR is one of the few applications that's actually generating significant on-chain revenue via their product. And that is what stands out about Maker-Dal versus any other thing that's in D-Fi. And for some reason, the MKR prices does not reflect that. It's the turtle, man. It's slow and steady. It's like my turn at MT, David. It's just like, you've got to love it. It's just crank it up on a yearly basis. And actually, we say it's slow, This is pretty fast for all other traditional markets to go from 50 million to 10 billion in like the course of two years.

Starting point is 00:09:57 Let's talk about something else that is growing fast. And this is why this roll is going to last two hours. Inflation is searching 7.5 percent. This is annualized. This is inflation on U.S. dollars. So inflation is continuing to heat up, crank up, even more than expected. Highest since 1982. The numbers just came out.

Starting point is 00:10:17 I saw this meme. I thought it was kind of funny. kind of sad. What are you going to do? You just got to laugh at it. This is me washing $200 worth of groceries in 2022. And it's like this picture of like a tiny sink, a miniature fruit, a tiny sink and a strainer. Yeah, what's going on? I mean, with regards to how this impacts crypto, I'm conflicted because like more inflation drives people into harder assets like crypto assets, but also more inflation means the Federal Reserve is going to be more aggressive against fighting that, which means they're fighting our assets. So like I'm conflicted. Yeah, I think ultimately this is part of the same story, which is, you know, crypto's going to do quite fine over time relative to Fiat. But yeah, who knows what it'll do in the short run? I wonder if inflation is going away sometime this year. We're going to drop.

Starting point is 00:11:06 Remember our Jim Bianco episode, he sort of predicted that it will get higher. It will also peak. And then by the end of the year, we might see something like 3 to 4%, right, as sort of the new normal for inflation moving forward. It's hard to know. Who knows? Yeah, we will figure it out. But crypto is bullish regardless of inflation. Yeah, that remains true.

Starting point is 00:11:28 And we'll talk about a bit more reasons why it is bullish when we get to releases. Before we do, we want to thank the sponsors that made this episode possible. The Gemini Exchange has been my exchange of choice ever since I got into crypto. I used Gemini to both buy the dips and also manage my regular automatic monthly purchases of my preferred crypto asset. On Gemini, you'll find over 50 different cryptos, including many of the top defy and Metaverse tokens like Wi-Fi and Axi Infinity. Using Gemini Earn, you can earn yield on your various cryptos, including 8% on the GUSD stable coin. Gemini is available in all 50 states and

Starting point is 00:12:02 more than 50 countries worldwide. So if you're looking to upgrade your crypto exchange, sign up at Gemini with Gemini.com slash go bankless and get $15 of Bitcoin after you trade $100 or more within the first 30 days. That's Gemini.com slash go bankless. Bankless is proud to be sponsored by Uniswap. Uniswap is a new paradigm in asset exchange infrastructure. Instead of a cumbersome order book system where trades are matched with other humans, uniswap is an autonomous piece of software on Ethereum that lets you trade any token at the current market price. No human counterparties or centralized intermediaries, just autonomous code on Ethereum.

Starting point is 00:12:40 Input the token you want to sell and receive the token you want to buy. The Uniswap Grants Program is accepting applications for grants. Do you have something of value that you think you want to contribute to the Uniswap ecosystem? No matter how big or small your idea is, you can apply for a unique grant at Uniswopgrant.org and help steer Uniswap in the direction that you think it should go. Thank you, Uniswap for sponsoring bankless. The Brave Browse is the user-first browser for the Web 3 Internet, with over 50 million monthly active users. Control your digital footprint with built-in privacy and ad blocking. Inside the Brave browser, you'll find the Brave Wallet, the first secure crypto wallet, built natively,

Starting point is 00:13:16 inside of a Web3 crypto browser. Web 3 is freedom from big tech and Wall Street. More control and better privacy. But there's a weak point in Web 3, your crypto wallet. The Brave wallet is different. Brave wallet is built natively inside the Brave browser,

Starting point is 00:13:29 no extension required, which gives the Brave wallet an extra level of security versus other wallets. With the Brave wallet, you can buy, store, send, and swap your crypto assets and you can even manage your NFTs and connect to other wallets and Defi apps,

Starting point is 00:13:43 all from the security of the best privacy browser on the market. Whether you're new to crypto or a season pro, it's time to switch to the Brave wallet. Download Brave at brave.com slash banklist and click the wallet icon to get started. All right, guys, we are back with the hot releases of the week. Let's start here. Something is blooming, says the Lens Protocol. I think this is AVE's social network.

Starting point is 00:14:04 That's what Lens Protocol is. What's going on here, David? Yeah, this is the hotly discussed web three social media platform being developed by some of the team behind Avey. So everyone's kind of hungry for details, and we're starting to get some of those details out right now. I think the high-level TLDR, before we know too much, is that we are taking a social graph, as in like imagine all of your connections on Twitter or Facebook. That's a social graph, like a social web, all of your connections. And then Lens Protocol is working on building that on-chain as part of like the trustless, verifiable,

Starting point is 00:14:37 immutable properties that blockchains give it. And so that we can have a social graph like Facebook, but that's open rather than enclosed, because Facebook doesn't let you, you know, export your social graph. This, because it's on chain, you can export your social graph, and that makes it like, you know, composable. Other people can build on this is the idea. And so this is an on-chain social graph that's being deployed onto Polygon. So Polygon is the network of choice.

Starting point is 00:15:00 I think we're all kind of waiting to see what happens next and how this rollout plan occurs. We are in conversation with Christina from Avey, who is checking with compliance as to whether she can come talk about this on a bankless panel. about social media and digital identity in the Web 3 era. So hopefully stay tuned for that because it's going to be a really hot panel. Yeah, this is a bit more of a protocol than I thought it would be, David.

Starting point is 00:15:23 There's no app yet, but I guess that's what you have to build out first. It's sort of the protocol, the primitives for the social graph, and then you can build the apps on top of it. David, you're something from Celesta. So their data availability bridge has launched, I believe. And Celeste is like a data availability layer. How would you explain what a data availability layer is, David? Yeah, so when you make a transaction on a blockchain, it gets embedded into a block. And that is you putting your data into a blockchain.

Starting point is 00:15:53 And all blockchains that have a history or store their history on their data availability layer. Now, we talk about like the modular concept of blockchains and how you can take apart each different module or component. And the data availability layer of blockchain is just one component that's separate from consensus. how consensus comes how things come to consensus is different about what we are coming to consensus about and data availability is what we are coming to consensus about or what we've already come to consensus about and are now storing and so this is an innovation in the storage aspect of what has already been having consensus had about yes well so okay so here here's how I think of it so we've got three layers in the modular blockchain right you have consensus that's what's true you have data

Starting point is 00:16:40 availability, that's what's happened, and then you have execution. That's what's happening right now. And so the modular blockchain design splits these three pieces up into separate parts. And so Ethereum Mainnet is really going to be the consensus layer primarily. And then later, when we have data shards, it will turn into a data availability layer as well. So that means there's opportunity to outsource some of the transactions, the data availability transactions, which is basically the history, the blockchain history, if you will, to somewhere else. And Celesta thinks it can be somewhere else. Polygon also has a solution to this.

Starting point is 00:17:18 Like immutable is offloading its data somewhere else right now, not on Ethereum main chain. So it's cool to see this space emerge, and it fits right into the modular chain thesis that we have. If you have no idea what we're talking about right now, go listen to the modular blockchain podcast that we put out a few months ago. and that'll get you up to speed. Really important concept. Speaking of Polygon, David, Polygon Edge, it's a new product from Polygon. It allows anyone to spin up their own EVM chain in minutes. So this is like side chain as a service, I think. That's how I understand it.

Starting point is 00:17:56 It has layer two support, more consensus modules, trustless bridging, that sort of thing. And, you know, founder of Polygon says multi-chain Ethereum is coming. It feels like it's here. What's your take on this? Well, we've seen how lucrative it is to take the geth code base and fork it and spin up your own L1. Oh, Avalanche? Oh, you said it, not me, Ryan. But yes, Avalanche. Polygon Edge is turning this into a service. Like, yeah, let's allow anyone who wants to spin up an EVM chain, enable them to do that. And then it's just a super awesome way to capture business in mind chair if this becomes a valuable service.

Starting point is 00:18:35 And maybe this is a litmus test as to like, do actually people want to spin up their own side chains or do they want to just issue their own L1 tokens? Like, what does the market really wants? We'll find out. Yeah, I do think that sidechains are going to become somewhat of a commodity. If you could just like spin them up and pump them out and print them like this as Polygon is doing. But it definitely builds the network effect for the EVM, things like this. Also speaking of network effects, looks like some of the layer ones are getting it. FtX, major exchange that you know, of course, it now.

Starting point is 00:19:05 supports Arbitrum on Mainnet. So I think this is withdrawals and deposits to and from Arbitrum, the way Binance supported it about a month ago. What's weird here is like, when Coinbase? Where's Coinbase and all this? Yeah, Coinbase coming in third at least. I mean, FTC saw the demand out of using Binance to get Ether onto Arbitrum. So they're like, even FTCX, which isn't inherently Ethereum aligned,

Starting point is 00:19:30 is like, oh, we want some of that value too. So they're doing it. Win Coinbase. When Coinbase, Brian, don't make me text you. Or actually, we should probably should text them. We should text them. Let's work on that. Rayses on the raises section.

Starting point is 00:19:45 Speaking of Polygon, we were earlier, they just raised $450 million from Sequoia Capital India, SoftBank, and Tiger Global, pretty massive raise for this layer two, which is really what Polygon is. It has side chains, but it has a suite of layer two solutions as well. And it just goes to show you alternative layer ones aren't the only ones building out war chests, right? This is going to be very much a fight for the execution layer of crypto. And Polygon is raising a war chest in order to engage in that fight. We all know that we're moving into a multi-chain world, whether it's a multi-Layer one world or a multi-layer two world. And Polygon kind of has real estate in both sides.

Starting point is 00:20:29 And so it's kind of like a bet on a many-chain world. and we know that we can't have one dominant single blockchain, like in order to scale this ecosystem, we need to have many chains. Guess who has many chains? Polygon. Polygon's got a lot of chains. We've got chains of every flavor. L2 chains, L1 chains, side chains, any chain you want is Polygon. Let's talk about this race too.

Starting point is 00:20:50 Alchemy, $200 million raise at a $10.2 billion dollar valuation. Crazy. 10.2 billion dollars. If you guys don't know what Alchemy is, it's probably because it sits behind the scenes. Anytime you use like Metamask or many of the apps today, there's that historical data that your Defy apps need to call. And likely they're calling something like Alchemy.

Starting point is 00:21:14 Alchemy powers a ton of this. It's sort of like the AWS for blockchain data. So we're not talking about kind of the consensus layer running eth nodes so much as all of the indexing that needs to happen to make the front ends of DeFi applications work. Like a ton of that is powered by Alchemy. So that's how you justify that $10.2 billion valuation, just the massive growth of defy and blockchain indexing. I do think they have plans in the future to decentralize a little bit,

Starting point is 00:21:43 but they are centralized right now. So think of this as like blockchain AWS, in my opinion. Any thoughts on that? Nope, that's about right. Jobs time, David. You ready, man? You're not doing regular plays. I don't know if you can get up and dance for this. I'm sitting down, so I'm sitting down dancing today. You're sitting down celebrating. Guys, this is your reminder. We do this weekly because it's important.

Starting point is 00:22:05 2022 could be the year you get a job in crypto. Because we got jobs, don't we? Lots of jobs. Binders full of jobs. We got tons of jobs. A senior product engineer at Moment ranks. A community manager is a contractor, DYDX. Governance growth lead at DYDX.

Starting point is 00:22:21 Business Operations and Finance Associate. DYDX. Marketing Associate, DYDX. Lots of different skill sets here. Accountant, Smart DFI. Web 3 engineer at Goldfinch, a senior go Rust engineer at Syndica, smart contract tech lead at StarX as well. I could go on, but there's this new feature on the bankless job boards I should mention as well.

Starting point is 00:22:42 We are building a talent collective. So this is a little bit different. This is where the talent gets to submit their profile, and then the Web3 companies get to go prospect that. Yeah, it's like, so think of like LinkedIn, your own Web3 LinkedIn profile and employers come to you. So maybe you want to play a little hard to get or just put the feelers out there.

Starting point is 00:23:03 All right. Submit your profile to the talent section and, you know, web three job finders, web three hire, talent hires, talent acquisition, will come find you. That's the way this network works. Let me tell you, in this day and ageing the crypto industry, the market favors talent more than it does jobs.

Starting point is 00:23:25 There are more jobs than there are talent. They will find you. They will find you. Yeah. Put yourself out there. If you are passively seeking, it's a good idea. And of course, if you're an employer, you know, we've got some talented folks in the bankless community that you can connect with. All right, David, let's move to news, man.

Starting point is 00:23:44 Talented folks, huh? Let's get into this. We have some talented folks. We have some not so talented folks as well in crypto, to be fair. This is a story. Yeah. Who are they actually talented or not? It's something that we're going to have to figure out.

Starting point is 00:23:56 All right. We have to start with the big headline. Okay, so for context, in 2016, a very significant exchange called BitFinex got hacked for what was then, I think, like $72 million worth of Bitcoin. Over 100,000 Bitcoin. I think it was like 116,000 Bitcoins. So remember, 21 million supply, 116,000 of those Bitfaxe exchange. It's like Michael Saylor levels of Bitcoin. Yes.

Starting point is 00:24:25 Yes, that's exactly right. I think that's exactly around the right number. Imagine all of Michael Saylor's Bitcoins getting hacked from this exchange. A very big deal. This happened before my time in crypto. But it just caused a bunch of drama and hubbub and no one knows what happened to the Bitcoins. Turns out, the Department of Justice found the Bitcoins in the hands of two individuals, Eila Liechtenstein, 34, and his wife, Heather Morgan, both residents. of New York were arrested in charge with money laundering of the cryptocurrency stolen from Bitfinex in 2016. The Department of Justice says that it has recovered a whopping $3.6 billion worth of Bitcoin. I think they recovered something like $90,000, 96,000 of the $116,000, so

Starting point is 00:25:13 they're not all of it, but like significantly most of it. So this is a big bust and a good recovery. And so, you know, when I first read this, I was I was picturing some like, you know, elite crypto hackers out there. Some shadowy super coders, right? Not only did they heist. Living off of the United States somewhere else. Yeah. No, you know, they didn't only

Starting point is 00:25:35 heist billions of dollars worth of crypto, but they also hit it for like almost a decade. Yeah. Okay. So like, what are we expecting there? And yeah, so I was expecting some sort of shadowy super coder to emerge. But instead, we got something else, David. What did we get?

Starting point is 00:25:51 We got these ridiculous instilled. people who, like, the woman wants to be a rapper and she's terrible. Struggling influencer is what I might say. Significantly, rightfully so struggling influencer, who is like acting like an actual actual lunatic on TikTok and Instagram, making very just ridiculous raps. The behavior of these two people who are very, very public is insane. It's insane who they are. They are not right in the head.

Starting point is 00:26:25 And like, I'm trying to, like, think that it's a show, but I don't think it's a show. I think it's real. Here's a video of her eating these fluffy pancakes and commentating out it. We'll put the links in the show and us about how crazy some of this stuff is. It's just fun. It's just good entertainment, you know. It's one of those things that's like I watch these videos. I'm like, why do I even care about this world?

Starting point is 00:26:46 Look at this. What the hell is what's going on? Okay, for the listeners, this is the lady, the woman hacker. drinking a Heather drinking a bottle of something with her toe, with her feet. So like bottle in her feet,

Starting point is 00:27:02 drinking it going straight to the mouth. This was a couple, oh my God, it's absolutely. Billionaires are getting weird, David. This person's a billionaire hacker, right? You know, next slide. What is this? Yeah, so this is Tarun Chitra.

Starting point is 00:27:15 We've had them on the podcast. He used to host these like kind of Web 3 style talks of dinners every now and then. And he hosted Heather Morgan once at one of these talks in 2019, and the talk that Heather gave was how to social engineer your way into anything. And so she gave like these... I'd say she's qualified. Yeah, quite call. Clearly, she took her own advice. I mean, this is three years after she and her husband hacked BitFinex, right? Allegedly hacked Bitfinex. And so like some of the pictures that came out

Starting point is 00:27:48 from this were absolutely insane. Did you have that tweet pulled up? Oh, there's more than this? Yeah, scroll down. There's a few pictures. Yeah, here we go. Oh, this. Here we go. How to socially engineer your way into everything, from proving cold email tactics to event crashing

Starting point is 00:28:02 and infiltrating black markets around the world. There's something for everyone. Let's go to the next photo, yeah. So like, actually, go to the next one, go to the next one. Okay, useful objects for event crashing. Badges, press passes, professional camera, a notebook, money for tipping if you need to bribe people, your way out of it.

Starting point is 00:28:20 A black shirt because you look like security. layered outfits and accessories. This is so shady. We actually don't know how we are still discovering how they actually got the BitFinex Bitcoins. We don't know that yet. I mean, this might be the answer, right? They probably socially engineered their way

Starting point is 00:28:40 into like $3.6 billion worth of Bitcoin. Right. And so, okay, it's just for TLDR and social engineering. It's not like Hacker Man where you're tapping on your keyboard, exploiting some weakness in BitFinex's like walls. it's doing something like calling an employee, pretending you're like an exec, and you get them to give you some information. And so it's a social, it's social. Like you are talking to someone and they just give you something.

Starting point is 00:29:03 It's way easier and probably like a greater, you know, weakness in most of our systems and structures. Yeah. Some places I've infiltrated. Wow. Imagine documenting your crimes like this, David. Mm-hmm. Just for the clout, you know? It's absolutely crazy.

Starting point is 00:29:19 You got to make sure everyone knows. This is a tweet from Alistair, Malin. Imagine being a hacker or money launderer and keeping the unencrypted private keys to $3.5 billion of Bitcoin in an online account linked to your name. Mind blown. Are you telling me that this is where the FBI found it? It wasn't like on a ledger. It's not on some private keys that they manage encrypted somewhere. this is on an unencrypted online account linked to their names.

Starting point is 00:29:54 It was encrypted, but apparently very poorly. So here's from the DOJ report. They say, after the execution of court-authorized search warrants of online accounts controlled by Liechtenstein and Morgan, special agents obtain access to files within an online account controlled by Lichtenstein. Those files contained the private keys required to access the digital wallets that directly received the fund stolen from BitFenet. and allowed the special agents to lawfully seize and recover more than 94,000

Starting point is 00:30:21 bitcoins that had been stolen, covered Bitcoins valued at $3.6 billion. So apparently it actually was encrypted. There's another report, and the link in the show notes will provide more details. But apparently it's just encrypted poorly. Ah, okay. There is good and bad encryption out there. So they stored it online with poor encryption. Under their names.

Starting point is 00:30:41 Under their own names. Okay, again, how we actually know these people attack? We don't know. We just know that they had the bitfinex and they were like, you know, money laundering it. David, why did it take the FBI so long to find this? I don't know. I don't know. Like, we're going to have to, this is going to be an ongoing, like, report. We're going to, we're going to be following this one for a while. I mean, I think the other big question is, okay, $3.6 billion. What happens now? The FBI owns it. This is part of the mess. They've seized stuff in the past and they've, like in, you know, previous seizures, like the Silk Road, they've auctioned it off, right? Is that kind of what happens? or where did the proceeds go? Who actually should own this money? Yeah, so this is part of this big mess. And so there is BitFinex attempted to make all of its customers whole again

Starting point is 00:31:27 via issuing equity or IOUs to say, hey, we're going to repay you guys once we figure it out. And from my limited knowledge on this, it's like they actually did make customers whole again via a combination of issuing this Leo token, which is kind of like a pseudo equity. It was like BitFinex's version of BNB. and you actually could see the Leo token price. Leo was a promise, it was some sort of like commitment on like value or if you ever got,

Starting point is 00:31:55 if they ever got the Bitcoin's back. Pseudo equity kind of thing. Pseed with a promise to repay Bitcoins if it was re-seased by the FBI and then given back to BitFenex, the rightful owner of the Bitcoin's. But like customers have kind of been more or less paid out by this hack. Everyone felt good with it.

Starting point is 00:32:13 More or less. It's not like Mount Gox. They felt like they were made a hole. Right. Exactly. You could actually see the Leo token spike in price well before this news broke. So like, people start, yeah, yeah. Efficient markets. Yeah, right. And so, but now the Leo token price, which is in theory and IOU based on the backing of the Bitcoins that's now been seized, it went from something like $5 to $8 on the news that the Bitcoin had actually been seized. But now there's a bunch of drama about who actually gets the Bitcoins because people have differing opinions on this. So a quote from Eric Vorhees says,

Starting point is 00:32:45 BitFenex doesn't owe me anything. They made me whole years ago. Eric Voorhees lost some Bitcoins in the Bitfinex attack. But apparently many customers disagree, particularly given Bitcoin's appreciation from less than $600 in August 2016 when the export happened to around $44,000 now, the tokens were worth about $71 million at the time of the hack,

Starting point is 00:33:06 the Bitcoins, and now is valued at $4.5 billion all... Oh, there's definitely... Look, this is going to be settled in courts, right? There's going to be lawsuits from customer. Like, there's going to be, this is going to be a long drawn-out process to see who actually gets that money. Right. So, like some customer says, I think that this is ridiculous. That's my Bitcoin that they took from my multi-sick wallet.

Starting point is 00:33:27 I would like my Bitcoin back Arnav. This customer says he doesn't remember if he signed away any rights to his stolen Bitcoin while accepting the BigFinex reimbursement. They can have their equity back, says Arnoff, who claims to own about $50,000 of a liquid BitFinex stock. I'll take my Bitcoin. Thank you very much. So tweet TBD on how this Bitcoin actually gets distributed. Man, uh, hilarious. I guess, you know, what are the takeaways other than like something like this is going to make the best crypto movie ever? Like incidents like this. So a super cringe crypto movie. Right. Are you embarrassed that this is why we're making headlines?

Starting point is 00:34:03 It's like one of those things like if you go like if listeners are that curious, go to the link of the show notes, go to this Heather's Twitter page and TikTok page and like watch how absurd her behavior is as an individual on this planet. Just stay tuned for the moment of Zen. Stay tuned for the moment of Zen. At the end of this episode. Like I'll hide your kids because you don't want your kids listening to it. It's just, you can't make this up. You can't, if you were to write this down and like give this to like a producer of a movie, they'd be like, what the hell is this?

Starting point is 00:34:31 Yeah. This is lunacy. It's absolutely insane. It's the best. It's the best. Books will be written. Movies will probably be made in the future. this is crypto. Every week something like this happens.

Starting point is 00:34:41 And on a completely different end of the spectrum, something equally loud also has happened in like the cryptosphere. This has been a very touchy subject for a lot of people. So we're just going to like cover this. Just the facts, ma'am. Just the facts, just the facts. Okay. So the facts are Brantley Milligan, one of the OGs behind the ENS protocol. And also has always been very, very publicly Catholic, had some 2016 tweets merged talking very negatively about a lot of individuals who identify in certain capacities.

Starting point is 00:35:13 He said homosexual acts are evil. He also said contraception is a perversion among other things. So is porn and masturbation. You know, Catholic stuff very out loud and open. And the thing is like these tweets got surfaced from 2016, but then Brantley like doubled down on it on a public Twitter space. And that's really what really set off this conversation. Since then, I believe members of the nonprofit True Names Limited,

Starting point is 00:35:41 that employees have voiced concerns about working with Brantley. Brantley has his contract has been terminated with True Names Limited. And now, as a result of this, there is kind of like this cultural infighting, I guess, about like woke culture versus whatever the opposite of that is. And now we're trying to find out, like, is this woke? culture, is this cancel culture, or is this just people expressing, like, they don't want to work with somebody that says that they openly hate homosexuals? This is something that, like, the crypto community is trying to, like, unpack and come to terms with and come to some sort

Starting point is 00:36:14 of conclusion and have closure with. A lot of fighting on Twitter. It's been very draining. Yeah. Yeah, it has been. It's just unfortunate. I guess we'll kind of leave the story there. I think it's, you know, unfortunate overall. You know what? Actually, going back to the hack thing, the $3.6 billion dollar hack when that news broke, I almost felt like it was like some healing for crypto. Like, crypto was getting very, you know, like heavy topics, very serious, right? And there was like a lot of vitriol back and forth. And then we got this great story. And everyone is just like, okay, let's pause.

Starting point is 00:36:46 Let's have a moment and just laugh at the absurdity of what's going on. Let's get weird again. Yeah, it's getting weird again. That felt pretty good. Anyway, that's the story. We got some adoption news, too. Man, big institutions in crypto. They're here.

Starting point is 00:36:59 They're coming. So KPMG of Canada. They just added Bitcoin and ETH to their balance sheet, people. That's huge. That's big. KPMG, Canada, big auditing firm, big accounting firm. And they're adding ether and Bitcoin to their balance sheet. I can't believe I'm saying that.

Starting point is 00:37:16 Two of the big four have Bitcoin and Ether on their balance sheet. By the way, we told you it would be ether too. Sorry, not bankless listeners. I know you guys already know. But like we told people it wouldn't just be Bitcoin. It would also be ether. And these are the assets that they're adding. Pretty cool to see.

Starting point is 00:37:32 as well. What are they doing here, David? Offering crypto trading. So dive and getting their toes wet into the world of crypto. Black Rock, the world's biggest asset manager, biggest most money under management starting to get its roots into the world of crypto. I'm happy to say that in the last couple weeks I have helped convince a Black Rock VP person exit from Black Rock. Oh, you did. Yeah. So yeah, got them into the world of Web 3 out of the souls. So should we thank you for this, David. The sole, yeah, you can thank me for this one. This is my doing.

Starting point is 00:38:05 But, you know, there's Black Rock who's getting into crypto, and then there's just straight up working in Web 3. Go to where the puck is going, or skate to where the puck is going. But, you know, good job, Black Rock. You're catching up. Trillions of assets? I mean, they're pretty massive. So, of course, they couldn't ignore this space for long.

Starting point is 00:38:23 Neither can Apple. New Apple iPhone feature, giving merchants a way to accept crypto payments. And so I don't know if you... use Apple pay on your iPhone. All the time. Exclusively. Now you can just connect it to a coinbase card, a crypto.com, visa card, something like this. And you're basically just paying using crypto.

Starting point is 00:38:40 This isn't super defy yet, but like at least it's bankless money, right? Ether is bankless money. Bitcoin is ether bankless money. And you could pay via that, which is pretty cool to see. Here's another adoption story from our friends at Wells Fargo. What's this, David? It's a whole report. Yeah.

Starting point is 00:38:58 Understanding cryptocurrencies. too early or too late. It's too late for you, Wells Fargo. So Wells Fargo finally trying to do some education. I have not read this report, so we'll see how actually good it's... I mean, their main takeaways where, look at this line. Cryptocurrencies appear to be near a hyper-adoption phase, similar to that of the internet during the mid to late 1990s.

Starting point is 00:39:21 I guess they're listening to Bankless. It's bullish Crypto, not so bullish Wells Fargo. Where do you guys go? If crypto's here to stay, is Wells Fargo here? to stay? I don't know. Ryan, do we just put them out of their misery and just buy Wells Fargo? Someday. We're going to at least, you know, the arenas that they have. We got to replace Wells Fargo arenas with like bankless arenas.

Starting point is 00:39:43 Bankless arenas. Yeah. FTCs, look, we already talked about this, but layer two, FTX is supporting Arbitrum. Amutable. They now have USDC on the immutable chain on layer two. Via moon pay. So USDC on immutable via moon pay. So straight USDC on Remutable, via Moonpay. So straight USC on ramp right onto the L2. I think you can buy with debit and credit cards via moon pay. So just easier and easier to buy stuff on immutable. Also, set is deploying its perpetual protocol on optimism?

Starting point is 00:40:13 What is this, David? Yeah, so with Perp Protocol, perpetual protocol, is being integrated into Set, which is being integrated on top of optimism. So we got a trifecta here. Perpetual Protocol, we did to meet the nation with them, if you want to learn more about what they are, but it's kind of all in the name. perpetual protocol. Perpetuals need to be on L2s because they have a lot of computation.

Starting point is 00:40:33 They got integrated into set protocol, which is one of the same teams that's also powering the index co-op and some other assets. Index protocol, basically. Yeah, et-f. Yeah. And now they are also on optimism. So kind of in one fellow swoop, we got three things on optimism all at once. So that's pretty cool.

Starting point is 00:40:50 Stacking these money Legos, and now we're doing it. We're doing the stacking on layer two now, which is good to see. Stacks on stacks. Look, we haven't even gone to Ethereum stuff, but the good news is the merge is coming soon. Merge soon, then moon. Actually, we'll probably moon before that. But who knows? But the merge is going to happen soon.

Starting point is 00:41:09 And how do we know it? It's because developers are talking about it, the people actually shipping the code where, you know, everyone's usually asking these people like, okay, when's it going to be done? When's it going to be done? So when they say it's coming, when they say there are PRs that are one major PR away from being ready for the. merge, that's a good thing. And I think that's what Peter is saying. Who is Peter? And why is this kind of a tweet important, David? Peter is an OG open source, just open source maximalist, I think, is the right way to call them. Just believes in open source and has been working on the guest client for since the beginning of Ethereum. Tirest, tirelessly. Tirelessly. With out, without thanks,

Starting point is 00:41:51 sometimes, you know, without avalanche is built on guest, by the way. And so like the entire avalanche ecosystem was built on Peter and the Geth team because they were tirelessly building Geth because they believe in the concept of open source software. Peter tweets, although not really visible from the outside, the Go-Eetherium code base, that's Geph, is one major PR away, pull requests away from being done ready for the merge. And that PR itself is also done. It just needs test TM. Hashtag Ethereum. Basically saying, it's like, yo, guys, like, we're kind of ready to like start to break this thing. And if we can't break this thing, that means we're ready, ready.

Starting point is 00:42:28 If we can't break this thing, David, I'm going to say it because Peter's not, but if the tests, if there's not a major issue in the testing process, I think this thing goes live early summer. Yeah. I think we're talking June and July. Yeah. As long as we get through this testing phase without bugs, what do you think? Yeah, I think that's right.

Starting point is 00:42:47 The merge is coming. There are people murmuring about that's why Ether has done so well in the last two weeks. It could also just be reverting to me. Who knows? but the merge trade is definitely a thing. Did you say reverting to meme? Mean. Oh, I like reverting to meme too.

Starting point is 00:43:03 That's good. I think we're doing that too. Reverting to eth is ultra sound money. Reverting to meme. I think that's what's happening. This is, I love these tweets because I never understand what these tweets are. Oh, you don't understand this? Yeah, this is when developers tweet out

Starting point is 00:43:17 pick snapshots of the compiler, the command line. And they just get really, really excited. I have no clue what this means. I have no clue going on. But this is the time of the year where developers tweet out command line snapshots and get really, really excited, which means like something is happening

Starting point is 00:43:33 in the development space. Yeah, I'm excited. This is a test net from one of the beacon chain developer groups. This is from Prismatic Labs, who have the prison client. So good news, too. And can I summarize a little bit of this for the layman? Because we just talked about, like, the dev takes.

Starting point is 00:43:52 But I think, and this is a tweet I just put out, I still don't think people get it. Ethereum is about to become the world's best bond market after the merge. Where else can you get a bond denominated in a deflationary asset backed by an economy with triple digit GDP growth? The outflows from fiat bonds go to ETH. I still think this narrative about ETH being a non-sovereign bond store of values is like unknown right now, David. It's like I think that people still don't understand it. they still don't get it. This is like a T bill, okay, except it's equity, so you get like upside

Starting point is 00:44:31 exposure, and it's denominated in a deflationary asset, and the economy is growing 400% per year. When I say the economy, I'm talking about block-based sales. That's what it's growing. It grew over 400% last year. Okay, imagine that. GDP in an emerging economy growing up 400%, the thing that you're buying as a bond in this economy, which is also like buying stock in their publicly traded market, and it's all denominated in an asset that is a store of value that's deflationary, unlike all of the fiat systems. Tell me how this doesn't just slurp out all of the liquidity and all of the capital from the traditional fiat bond system. I think that's what happens here. in the same way that like bitcoin is kind of slurped out of all the capital like some of the

Starting point is 00:45:20 capital from gold and is on a trajectory to do that more and more over time ethereum's coming for the bond market you know 30 40 trillion dollar non sovereign or sovereign bond market that's what it's going to do yeah and i really just want to keep on going on this but we have such a long agenda yeah we do and you know last thing i will say it's like so so many so many people there's a lot been a lot of tribes, especially in the last half of 2021 around, all these alternative layer ones, and people are doing this whole relational trade, these comparative trades, like, well, if Ethereum is this market cap, then like Solana should be this market cap, or Teso should be this market cap, or Avalon should be this market cap. That is baking in the

Starting point is 00:45:56 assumption that those assets actually compare to ether the asset. Are you sure that they are actually comparable? Because I don't think they are. And so, you know, once this merge actually happens and some of these actual metrics actually start to become instantiated in the value of the asset, we will see whether those, you can actually compare those things. I think it's apples to oranges. So do I. Time will tell. It's bullish, though. Look, the merge is going to be bullish. We all know this. David, let's talk about this. Assange Dow. So this is Julian Assange. Tell me about this story. Looks like it has support from a pretty major backer at this point in time. So what is it? Yeah, this is coming off of the heels off of things like Constitution Dow and Ross Oldbrick

Starting point is 00:46:40 Dau, Ulberg Dau, trying to get Ross out of prison for the Silk Road. Now we're making Assange Dow to help fund Julian Assange's basically like probably legal costs, which we kind of know I think are coming because he's probably going to get arrested somehow, somewhere. And so the Assange Dow has netted $55 million in ether, 17,000 ether. Vital Gutrin donated 10 ether. Martin Copleman also donated 10 ether. And so people are pushing ether into Assange down to help fight for Julian Assange. Here, look, it's a crypto use case. You can't do this with GoFundMe. Okay. You try to do this with GoFundMe. They de-platform you. I mean, this is what happened with the Canadian Trucker incident that's going on in Ottawa right now. And, you know, whether you support that or you're not, it doesn't really matter.

Starting point is 00:47:31 They just got de-platformed by Go-FundB. And actually, in this case, David, Go-FundMe. said to you, like the truckers that were raising money for this protest, yeah, and we're going to confiscate your donations and give them to other charities. That's what they actually said at first, rather than refunds, right? It's like our money system, I don't think that held up under scrutiny, but they can do that, right? This is why we need uncensoredable money systems, right? Whether it's this cause, Sanchdow, you know, or some other cause that you support, at some point in time, you're going to be on the receiving end of deplatforming. And that's not cool when it happens to you.

Starting point is 00:48:14 So free money, public money systems. That's what we need. I'm glad there's ways to organize this now. David, we got to zip through all of the NFT stuff that's going. We're going to go really fast here. Let's talk about the Super Bowl, though. How many ads do you think are going to be on the Super Bowl? I think I asked you this.

Starting point is 00:48:31 Like a couple weeks ago, and you were like three or something. And I gave a higher number. I think I said like seven to ten or something. What about now? How many ads? How many crypto ads or NFT ads? Some allusion to crypto. How many you think we'll see in the Super Bowl? Seven. Seven. Seven. See, it's up. It's up. It's by my estimates. All right. So, like, we know crypto exchanges are going to be there. You got to see some FTX. Definitely. I would be surprised if not. Unsure about Coinbase, but FTX definitely. Definitely. So there's going to be at least some exchanges there. And if you group like the crypto.coms and the next to you as crypto banks, then, you know, the be there. And then we've got like, Bud Light and Nouns down. So we know that one.

Starting point is 00:49:11 We know that's coming. Two strong ones. Yeah. Bored apes, probably like this is what they're good at. So board apes like a likely third. We're already up to three. Yeah. I mean, I think you're going to see them scattered throughout all of these different brand commercials who just like, why do they come to NFTs? It's cloud collection. They're trying to get the, you know, the coolest, hippest, you know, most vibe, you know, culture thing. And so they're going to have NFTs.

Starting point is 00:49:37 Dapper Labs is going to be there as well. So that's like a guaranteed three. We already have at least three that are guaranteed. Is this a Super Bowl commercial? Is this just launching NFTs for the Super Bowl? Is this actually a- Oh, I don't know. That's true.

Starting point is 00:49:49 I don't know if this is going to be a commercial. This is Super Bowl related, though. I guess we'll see, though. And yeah, I don't watch the Super. Like, I kind of watch the Super Bowl, like, you know, some of yours. But this year I'm watching it for crypto commercials. Totally. I also don't watch the Super Bowl.

Starting point is 00:50:04 I just make guacamole and drink IPAs. That's good. Well, you still do that this year with crypto commercials. I plan on it. Yeah. All right. And that's not the only thing about NFTs. Nintendo also expressing interests in the metaverse and NFTs and they feel their potential.

Starting point is 00:50:20 I mean, think, again, anybody that has a brand is probably interested in NFTs. So, you know, think Mario, think Yoshi, all the things that you're Pokemon, all the things that Nintendo got. They want to make the metaverse out of it. And they kind of already have. Remember Pokemon Go? Yep. What was an early version of the Metaverse other than Pokemon Go? Right.

Starting point is 00:50:41 And so, like, this is a natural fit. So Nintendo, getting into NFTs. Yeah, especially if you're a video game company like Zinga, they planned to launch NFT-based games this year. We just, last week, we talked about Immutable and GameStop, creating a whole marketplace for this. This is a ready player me punk's game. David, what is this?

Starting point is 00:51:00 This isn't actually a game. It's like a meta platform. So if you have a crypto, punk, this is for you, where you can get a new sort of like avatar to put your Cryptopunk avatar into, and then the avatar apparently can go in many, many different games. And so it's like one, one NFT avatar thing that's interoperable with many, many, many games. And if you have a crypto pump, you can go claim one of these. Wow.

Starting point is 00:51:22 So NFTs are becoming like, you know, brand Legos in the same way that D5 is like Money Legos. And we're stacking these brand logos up. Of course, who's the biggest brand Lego builder out there in the traditional space? it's Disney, and they are hiring a business developer with NFT experience right now. That's a hot role. Disney's coming, okay? Gucci. Gucci is buying digital land in the sandbox as part of a Metaverse Experience bid.

Starting point is 00:51:47 Gucci, the apparel bag brand wants virtual real estate. When I read this headline, I was like, oh, maybe the dot-com bubble of this age is like the Metaverse bubble. A little bit. You know all the brands, do you remember way back in the day? There's this virtual world called Second Life where all of these brands started like putting up, you know, shops and storefronts and that sort of thing. And it totally died off because, you know, people like Second Life was boring. People didn't actually interact on it.

Starting point is 00:52:15 I wonder if this time it's a little different. And I understand why people resist that language. This time it's different. But this time we have economics, assets, property rights. And I think that's the thing that's been missing from the virtual worlds and the virtual worlds. metaverse this entire like that's the thing that gives that triggers a bubble that happen that's the thing that makes it will trickle bubbles it will trigger bubbles but also it will trigger real organic things that last and don't just like do the second life thing where it's kind of a

Starting point is 00:52:49 ghost town of brants there will be some ghost towns don't give me wrong i just think um previous digital worlds didn't have the the energy and life breathed into them that um you know that that that crypto brings with property rights at the base layer Right. How do you, in a virtual world, how do you, in the second life Gucci store, how do you buy stuff without crypto? Right. And how does money work? How do you like, I guess become an entrepreneur and how do you like, you know, develop some piece of property, some land or some asset and make it better and receive upside for that, right? It's like everything is kind of owned at the end of the day by second life, isn't it? Anyway, we'll see how that develops. Celebrities too. Breed Larson, she's buying a. NFT. What's this? This is a new NFT that I've seen. Actually, only celebrities get. So maybe celebrities

Starting point is 00:53:38 are finally ahead of me. Are you telling me they have their own telegram channels? They're front running us now. Yeah, probably. Yeah, celebrity alpha NFT. Follow girls' NFT bought by Brie Larson. If you want to experience what anti-NFTE hate is, you can definitely scroll down on this tweet. Oh, cool. There's some Brie Larson hate too, I'm sure. Oh, my God. That is a lot of capital letters. Oh, my God. Oh, this one's, this was so ridiculous. Someone just took a breath before they just typed in all caps for like. Okay, so here's the top reply to Brie Larson's NFT. Oh my God, not you two. I don't know how many celebs need to hear this, but takes deep breath.

Starting point is 00:54:09 It's literally written out. NFTs in crypto are horrendously bad for the environment, worse than the entire carbon footprint of some countries, so bad is tearing Kazakhstan apart in civil war. NFTs are apparently causing civil wars in Kazakhstan guys. Look at how many likes this has, David. Almost 12,000 likes. It's got more than the parent.

Starting point is 00:54:25 It's, she's been ratioed. She's got ratioed. She got ratioed. Look, this, if you haven't listened to bank lists long enough, to know why this is a terrible take and completely false and inaccurate. Definitely go listen to some more episodes. That's just crazy. It's just like false.

Starting point is 00:54:42 Also, RAC has a fantastic thread. We'll talk about that in a hot side. Yes, yes. Heidi Klum. Heidi Klum has a crypto punk. Cryptopunk? Yeah, me and Heidi Klum are basically BFS. No, she has way too much taste.

Starting point is 00:54:56 Yeah, so, yeah. Welcome to the family, Heidi. But when turtle? Seriously. Win turtle. That could be next. I'll ask her. What's happening here?

Starting point is 00:55:09 China. We're getting into China, CBDC type stuff. I think there's three things here, David, that all have the same thing in common. Maybe we just, like, read them out real quick and talk about what they have in common. Yeah, so we got China and the CBDC at the Olympics that's currently going on. We have Russia also coming to recognize crypto after recently banning it, question mark. and then also an El Salvador Bitcoin ban. So three different countries...

Starting point is 00:55:36 Bond. Bond. Thank you. Three different countries all doing some positive things in relation to crypto. Interestingly enough, China rolling out the digital wand, allowing a lot of people to use it in China while these Olympics are going on, has actually triggered the attention of the American regulators. And they're kind of like, oh, what?

Starting point is 00:55:54 It's real? Like, oh, people are... Stop using that. Stop using that. Don't use that. Don't use that. That's bad. We don't want you to use that.

Starting point is 00:56:02 What about our sanctions? We're going to have another hearing about the American CBTC. We'll rate two more white papers. Absolutely ridiculous. So some oh shit moments happening from the West about how China's CBDC is working at the Olympics and now people are able to experience it for themselves. So that's a bit of that. All right.

Starting point is 00:56:21 Next one, which is Russia coming to recognize crypto. I think the unifying theme here is like all of these countries are kind of like a little FU to the IMF, right? I mean, they see the IMF is sort of a rival power. They see systems like Swift being used for Western U.S.-led sanctions. And they're opting out. They're opting out of that. And you can kind of understand why.

Starting point is 00:56:44 But this is basically the game theory that crypto proponents have always predicted. This is the way that crypto gets propagated, where some country says, well, your payment system, your money system is not credibly neutral. It's not credibly neutral. So we're going to either go off and build our own or just default to one that is credibly neutral for the world. And this is why you think Putin is like embracing freedom here? He's just like, you know what? I'm listening to bankless and I'm real excited about the liberation. Those bankless guys are right.

Starting point is 00:57:17 Yeah, those bankless guys are right. I mean, look at the potential for freedom for my citizens and for the world. And so that's why you think he's saying that? No, he's just saying F-U-I-M-F, U. US doesn't control me. So we're just going to embrace crypto to piss them off. That's what's happening. That's the game theory. And the insane amount of sanctions that United States has on Russia makes it a very easy choice to make. Like, well, I can't use the global financial system because of sanctions. I will use crypto. Like it's just a logical conclusion. And so how does the US react

Starting point is 00:57:48 as a result of this? Do they double down and go like start shaking their finger at the rest of the world and saying, nope, you have to use our SWIFT system. No one, no one used this. Or do they wisen up and actually think about how they can embrace and adopt crypto as payment rails, maybe export the U.S. dollar in order to try to retain some reserve currency status of the dollar and also adopt these credibly neutral rails. Obviously, we think they should do the second. And by the way, guys, we had a fantastic podcast with Representative Tom Emmer that we're releasing next Monday where we discuss this very thing. So a member of Congress who sees it the way we see it, and is actually fighting for this sort of thing in Congress.

Starting point is 00:58:32 So stay tuned for that. But look, the geopolitics continue to play out, and crypto remains a big part of the story. El Salvador as well, you know, just like doing a Bitcoin bond hanging in there. Did you see this, by the way? So Ryan Selkis, our friend, he went on Fox News. He was on Tucker Carlson.

Starting point is 00:58:48 Did you watch this? I did not watch it, but the two faces right here are fantastic. Yeah, it was great here. This is like memeable as well. This is a meme template. it. I mean, the TLDR is basically, you know, Ryan's had some things to say, negative things to say about the Biden administration's handling of crypto. And of course, like, you know, Fox News and Tucker Carlson absolutely eat that, absolutely eat that up. And so I invited him on to talk about the U.S.'s, you know, strategy on crypto and how they're falling behind. So it was a good conversation. But look, this is another example of crypto bleeding into every area of media and gaining some mainstream attention. You'd never see this sort of, you know, interview a few years ago. I'm looking forward to additional interviews beyond Tucker Carlson.

Starting point is 00:59:32 Same. Okay, this was pretty interesting. Speaking of media, Binance taking a $200 million stake in Forbes. I think the play here is Binance is just like bought $200 million worth of positive PR. Yeah, that's my kind of negative take, but I think it's pretty accurate. Yeah, I think that's a good take. And I've always, you know, with crypto banks,

Starting point is 00:59:53 I think we've always like been excited because they're pushing the adoption of crypto yet also been wary because they can become the next centralization vector, right? And so, like, what happens when a major crypto bank starts owning the media? It's not something a protocol can do. Ethereum is never going to own a Forbes and be able to, like, you know, co-opt and covert media. And so it's okay right now for crypto adoption, but it's just another centralization vector. So, like, I look at this with some hesitation.

Starting point is 01:00:24 Or Forbes says finance good. Yeah, exactly. Exactly. Exactly. Exactly. David, we're going to get to the takes of the week in just a moment. But guys, we want to thank the sponsors that made this episode possible first. Stay tuned.

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Starting point is 01:03:08 This is a take written by Cooper Turley and Lucas Campbell from the bankless team. Web 2 allows you to focus on the quantity of your fans. Web 3 allows you to focus on the quality of your fans. Interesting distinction. quantity or quality over quantity is the difference between Web 3 and Web 2. What do you think this means? Yeah, I think the connection here is that because we have native money and things like private keys that allow us to put money directly into the hands of users, we can actually

Starting point is 01:03:38 start to reward users differentially based on their value to the artist or value to the system. So what this does is that if you are an individual fan who is the biggest fan of all time, like you can be rewarded for expressing that you are the biggest fan of all time where in like if you're the biggest fan of all time but you're just listening on Spotify you are intermingled with lesser fans and so web3 and private keys allow you to more granularly acknowledge the differing levels of fandom in this space and so we are allowing actual quality of fandom to rise up out of the the sifts of the basal level of just like Spotify plays this is the rise of the super fans and web three definitely

Starting point is 01:04:19 provides a conduit for that. It's less of an aggregation technology the way Web2 has been. This is your take, David. Why don't you read it out? Yeah, so I've been trying to help my friend get onboarded into Layer 2s and we're doing some air drop farming on Arbitrum,

Starting point is 01:04:39 which I think everyone's trying to do these days. But then I was like, had this choice paralysis as to like how to actually use the abacations on Arbitrum in a way that would actually cast a net to like farm the airdrop. And I was looking at all the apps. And it was like, farm a future arbitrum

Starting point is 01:04:53 air drop that you're speculating on. Yes. Yes. Yeah, right. Exactly. Thank you for that. And so it just made me think, like how are these layer two

Starting point is 01:05:03 is actually going to distribute tokens? Because it seems like a really hard problem. Because we want to reward whales and liquidity, but we don't want to centralize the token supply. We want to mitigate airdrop farmers, which is kind of what we're doing, but without also disqualifying small fries. How do you differentiate people that just put $500 or $200 into Arbitrum?

Starting point is 01:05:24 And just because that's all the money that they have versus people that are spreading out $200 all over the place on many different addresses trying to farm theirdrop. Like how do we do that? And also how do we fairly reward applications that have differing uses and different levels of adoption and quality? Like really, I don't really see a good solution to algorithmically retroactively do this in the same way that like ENSWOP had a fantastic like programmatic sort of. you know, retroactive airdrop. And so really the only way I kind of see this like working out is like a top-down best judgment distribution from the actual teams. So this is just something I'm thinking about. If you have ideas about how layer twos might distribute air drops, let me know because I want to use that strategy. Also, we published an article in bank lists this week about

Starting point is 01:06:10 some speculation from William Pister on how this, how layer twos might do that. So link to that in the show notes as well. Here's another take by RAC, and I think this whole thread is really worth using. The whole thread is fantastic. It's a thread about NFT hatred. He starts it off like this. Okay, so you hate NFTs.

Starting point is 01:06:32 Cool. Let's talk about it. This is an artist, music artist. Great artist. So coming from a creator background, and he is talking about the benefits of NFTs. And I really feel like he is addressing the criticisms head on. It's like a 10-tweet thread or so.

Starting point is 01:06:51 And it's definitely worth watching. There was a large YouTube video that blew up, like got 4 million views or something like this. Do you remember what that was called, David? Line up something? Yes, line up something. Yes. Anyway. Line go up.

Starting point is 01:07:07 Yes, line go up. This massive criticism about NFTs. I feel like RAC is addressing them head on. We probably don't have. time to go through all of them. But how about this tweet? I'll read it out, David, and get your comments. A lot of people seem to miss the entire point of NFTs is to make content free while making ownership scarce. Nobody is forcing you to pay for an NFT. You can still enjoy it for free alongside everybody else. You like my music? You can have it for free. That's the thing is like

Starting point is 01:07:38 I don't understand about the whole NFT anger, hatred is it's not a zero-sum game here. Like, people who hate NFTs, like, you're not losing anything. Don't buy them. This is the only upside for the creator. The creator gets this. Not some big corporation, you know, faceless, evil empire, music, record label, executive. It's the creator.

Starting point is 01:08:01 It's directly to the creator. It's something I've never understood about this argument. What do you think? He said. Yeah, this goes back to exactly what we were saying about Web 2 is quantity and Web 3 is quality. that allows fans that really, really care to buy NFTs, and that is the funding model for artists to incentivize them

Starting point is 01:08:20 to produce more total aggregate-free content. Let the people who want to pay the money pay the money so that the artists can get funded without all these intermediaries taking their unfair cut so that the artist can be more creative and do more creative stuff. I think people are still just wrapping their heads around what it means to have internet property ownership, where in like before in the Web 2 world,

Starting point is 01:08:40 there was no such thing as owning anything digitally on the internet. And so now that we, in the Web3 world, we have digital property. That means that, like, I have this thing and you don't have it. And you not having it is, I think, triggering to a lot of the Web2 folk that haven't got their heads wrapped around it. Oh, yeah, that's an interesting point. Yeah, but they haven't considered that, no, they actually still have the free content. And in fact, it's actually getting even better because we've made this new property thing that's going to the Web 3 people. So I think Web2 people are just kind of seeing being excluded, and they're not seeing the

Starting point is 01:09:13 increase of total quantity and quality of content come out of that. Yeah, there's some social dynamics that are definitely playing out and some pushback. Let's talk about Justin King. So he's the guy who built Twitch. Twitch, of course, has millions of users. And he tweets this out. Yeah, I built Twitch. Has millions of users.

Starting point is 01:09:34 And gaming NFTs are way bigger. Really cool to see Web 2 builders that are super bullish on gaming on NFTs on Web 3 now. That's starting to happen. I feel like this bridge between Web 2 builders and Web 3 builders is starting to be crossed. Yeah. And of course, the next tweet following that thread is anti-NFT hater. Let's see how many things they got. Oh, only 200.

Starting point is 01:09:59 Okay, not too bad. Yeah, that's bad. That's bad. Okay. Yeah, when the guy that Twitch says that NFT and gaming is going to be way bigger, Yeah, big deal. Yeah, AlphaLeak too. He's coming on overpriced JPEGs from Bankless Podcasts with Carly Riley.

Starting point is 01:10:14 If you are not listening to that on a regular basis, you should be, especially if you want to stay up to date on NFTs. It is the bankless for NFTs. Yes, it is the NFT alpha that I go to because NFTs are just too big of an industry for bankless to cover. Yeah, and I'm still here collecting turtles, okay? It's like, what do I know about NFTs? Dear God.

Starting point is 01:10:32 Speaking of Web 3, is Web 3 an echo chamber? This is a take from Bantag. Banteg, yeah. I thought that was a fantastic take. The first time I've ever heard a take like this is Bitcoin is money for enemies, as in like two enemies can send Bitcoins to each other because they can use Bitcoin as they trust. I really like that line. Bitcoin is money for enemies.

Starting point is 01:10:54 Yeah. And so Banteg is taking this to Web3, where Web3 is a place to share with your enemies. If you think that you can make everyone conform to your echo chamber, you are either naive or in the wrong business. because Web3 is open public permissionless protocols, everyone's going to be on them. And so all of this crypto, Twitter infighting that we've had in the last two weeks, that's just mass adoption.

Starting point is 01:11:16 That's just different communities coming into the same spot and bumping into each other. And that's kind of what we're going to have to figure out how to establish some sort of stable equilibrium. And that will just happen over time. But yeah, the Web3 is not an echo chamber. It's literally got all of the opinions in it.

Starting point is 01:11:30 Well, I love that in Web 3. You can't ban people you don't like. I love that it kind of forces forces people in the same room together. As he put it, it's a, yeah, hug it out, hopefully, right? There's all of your differences, hopefully, but we're all there together. That's cool. All right, man, look, we're almost at the end of this episode.

Starting point is 01:11:51 I feel like we just rug pulled to everyone because we said in the intro, this is going to be two hours, which goes to show you, David and I have no idea how long these episodes are going to last on a weekly basis. We just have no concept. We did a pretty good job of going real fast on this one. Yeah, we did. I guess, yeah, nice. So just turn that into a compliment. What are you excited about this week, though, as we end things, David? Yeah, so what I'm excited about is, I kind of said this earlier when we talked about ETH the asset.

Starting point is 01:12:18 ETHY asset. We just did that show with Ryan Alice about the DCF model for ETH. And then a community member came in with their own version of a DCF model. I said, no, like, I think these are the numbers. We have people debating about the numbers and the metrics of ETH or the asset. That is the only asset that has the properties to be able to even facilitate that type of conversation. And so when Ether, when Ethereum goes through the merge and we have the reduction of supply issuance because proof of work goes to proof of stake, and the average individual can stake at home or stake through some service, what Ether the asset is fundamentally changes in the whole comparative trade about like, well, if Ether is worth this, Solana should be worth this.

Starting point is 01:12:58 That's just going to go out the window because these things, you can't compare these things at that point in time. And so what I'm excited about, Ryan, and I know this can be a little toxic, ETH Maxi, whatever, is being able to say, I told you so, around the time of the merge when ETH just does some gangbusters price action, either before the merge or right after the merge or for like the next following decade, the differences between ETH or the asset, and every other asset inside of crypto and also outside of crypto is uncomparable. And so I'm looking forward, Ryan, to seeing that play out and having people say,

Starting point is 01:13:30 They're like, oh, they were talking about what is now everyone else is talking about. For David, it's not about making money. It's about being right. That's right. It does. I mean, look, I understand what you're saying because it has felt like sort of for a long time being a profit in the wilderness. Like we were talking about ETH and its value proposition since $80 on bank lists, right? Like a couple of years ago.

Starting point is 01:13:58 And so we're already on the past. to some of that, that, you know, gratification of, like, being able to talk about. And I do think the merge will be another major catalyst on that trajectory. That's cool, man. I know you're totally excited about that, too, Ryan, but I know you're also excited about other stuff. So what else are you excited about? Yeah, I'm excited about other stuff.

Starting point is 01:14:18 You know what? This week it kind of hit me with the whole, you know, the whole $3.6 billion hack and how crazy that was and how, you know, the lunacy of that. that thing that everyone just can't stop talking about crypto. Like it's saturating everywhere. It's like because we got everything. This is a car. Every week it's a carnival. We get to do this on the roll-up so it feels like this. Like it's finance. So we have the Bloomberg side. We've got entertainment. So this is like the, you know, e-celebrity news sort of thing. We've got all these celebs buying in. We've got politics. We're just talking about

Starting point is 01:14:53 Russia and China, geopolitics, Beijing Olympics. We've got economics. Okay. This is about like wealth inequality and like, you know, bringing more people into the economy. We've got technology. It spans all media. People, that's why people can't stop talking about crypto. And it's going to saturate every single part of media the way the internet did. So that's what's cool to me. It's just, it's all the weird stuff that happens.

Starting point is 01:15:20 It feels very weird. Like, it feels very natural and it feels very organic. And I don't think the world's going to be able to stop talking about crypto. And ultimately, what is that? It's bullish. that's bullish for this asset class. Because even when they're saying negative things about it, they're talking about it, aren't they?

Starting point is 01:15:37 And I don't see that going away anytime soon. We're going to continue to be in the news cycle for either some weird entertainment things, some celebrity adoption and new music artists, like billions of dollars in hacks. It's going to be in the news cycle for this entire decade. That's what I'm excited about. And I think that this goes to show

Starting point is 01:15:56 that crypto is about everything. Like, it's not just money. Crypto is going to take over the world because it's relevant to literally everything. That is like the fundamental bull case for crypto. It's relevant to politics. It's relevant to geopolitics. It's relevant to money. It's relevant to finance.

Starting point is 01:16:08 It's relevant to culture. Just how like exactly what you said, the internet touched everything. Crypto will also touch everything. So the fact that everyone's talking about it is just, you know, one of the big fundamentals behind this whole space. Bullish crypto content producers, I think David. We're never going to. You know, here's a funny story. When David Lai first started this.

Starting point is 01:16:27 When we first started this podcast, I was like, but can we do a weekly podcast? Are we going to have enough things to talk about each week? This is when we were doing one episode a week. That's what I was worried about at the time. Yeah, now we'd have 4.5 episodes a week. 5.5 if you're a premium subscriber. Oh, there you go.

Starting point is 01:16:45 Yeah, nice premium show at the end, David. Glad we fit that in. Hey, me, be the week time. What are we looking at this week? Boom. Okay, so this is, of course, a reference to the Bitfinex hackers where we have the expectation where the hackers are like the Ozark family. I'm not, I don't follow the list of, I just watched it.

Starting point is 01:17:01 I watched like the last season. It's good. Yeah, okay. So Ozark Family, I'm assuming some sort of like very professional, well done, optimized hackers of some type. Yeah, money, they're professional money launders, basically. There you go. Yeah.

Starting point is 01:17:14 Good at their jobs. And then in reality, we have these two like squares, like insane lunatics who, I mean, I guess they were successful money launders for a while. Struggling influencers? Struggling influencers who held. almost $4 billion worth of Bitcoin on private keys that were on a cloud database in poorly encrypted. Guys, that's the mean of the week. Just waiting to see what happens next week.

Starting point is 01:17:38 Lesson learned. If you steal $4 billion worth of Bitcoin, don't store it in the cloud. David, I'm going to shout out risk and disclaimers. But first, you want to give them a teaser of the moment of Zen that's coming up? Just don't listen to it. It's terrible. It's so bad. It's the, it's Heather trying to be a rapper.

Starting point is 01:17:58 Don't listen to it. Definitely don't let your kids listen to it. But after Ryan gives out his disclaimer, it's coming. Yeah, it's definitely risky. It's probably the riskiest thing about this entire episode. Of course, though. None of this has been financial advice. ETH is risky.

Starting point is 01:18:11 Bitcoin is risky. D-Fi is risky. You could lose what you put in. But we are headed west. This is the frontier. It's not for everyone. But we're glad you're with us on the bankless journey. And now it's time for your moment of Zen.

Starting point is 01:18:28 Go on. Make me a sandwich. You annoying Like bad It's so lame It's fucking tragic Bad bitch Bad bitch

Starting point is 01:18:40 Mother fucking bad bitch Bad bitch bad bitch Mad bitch bad bitch Mother fucking bad bitch Bad bitch bad bitch bad

Bankless - ROLLUP: Bitfinex Hack | Super Crypto Bowl | Aave Social Network | Vitalik Supports Assange DAO

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