Bankless - ROLLUP: Huge Binance Exploit | David Sues the Treasury | Devcon Bogota | PayPal Censoring

Starting point is 00:00:00 The BNB chain was halted, halted after a billion dollar hack. Bankless Nation, happy second Friday of October. It is roll-up time. It's also a special DevCon roll-up. David, you were hanging out in Bogota, Columbia, at DevCon this week. How's it going, man? Really good, man. Bogota is a ton of fun, and DevCon is just going absolutely fantastically.

Starting point is 00:00:27 There's so much energy here at DevCon. And it does kind of feel like the last like bonfire of energy in this bear market in the crypto space. But everyone is just really excited to be at DevCon. The talks and content is just very, very rich. People are stoked, man. People are really stoked to be here. David, DevCon is an Ethereum specific conference or is it wider than that? And then like this is the first time it's been in person in a while because of, you know, COVID and everything else, right?

Starting point is 00:00:53 So this is the first time the entire Ethereum community is theirs. Like give us a sense of the vibe. Right. and to what DevCon actually is. Yeah. Yeah, DevCon is, I would say, like, the foundation of much of the rest of global Ethereum conferences. It is the, well, it's not only actually anymore, but it is the conference thrown by the

Starting point is 00:01:13 Ethereum Foundation. So, yes, it is Ethereum-specific. In years previous, however, there has been many other exposures to other chains. Eos and Ethereum Classic famously were had other significant presence, and Algarand had significant presence at, when was it, Osaka, which was the last devcon that happened in 2019. There has not been a devon. 2019? Right.

Starting point is 00:01:36 There has not been a devcon in three years. And that's, it's actually made this devcon many, many people's first devcon, including myself, which many people are surprised. Like, oh, David, like, you've been in crypto forever. This is your first devcon. Yeah. And many other people have also, like, not been able to go to the devcons prior. I remember DevCon, 2018.

Starting point is 00:01:56 in Prague, I had just gotten into crypto, and I was just like, you know, couldn't convince my company to send this, like, person that they just hired all the way to Prague to go to DevCon. And then 2019 was Osaka, and, like, kind of the same deal. Like, if Osaka was going to be a $4,000 or $5,000 trip, and ether was like $100, I was like, I really want to go, but, like, that's- I'd have to sell some Ead or not buy some ETH. And so this is my and many others first DevCon. and it's it's i mean ethereum as an ecosystem is just completely different from last devcon last epitone was 2019 at like one to two hundred dollar ether and there was no deep very little defy

Starting point is 00:02:38 absolutely zero nfts no layer twos no layer twos uh plasma was our scaling solution at the time uh yeah right uh and so like it's just a fundamentally different devcon uh and they made this really cool video i'm going to see if i can get the video from the eF uh and just do something with it but they made this really cool interesting control video. And man, I got goosebumps, dude, of just like the road to DevCon and like what it took to get here going through like all like, like, you know, EVEConnect, the merge. EIP. It was like a speed run of the last like three years of Ethereum history. And like this really cool animated like promotion video. It was really, really cool.

Starting point is 00:03:11 And I know this is a Ethereum community, Ethereum ecosystem. And it's, it's heavily like dev. The Devon devons stands for developers. So it's a heavily developer-centric kind of conference. Like how many people are there? We're in the thousands, right? Oh, in the many, many thousands. Okay. I don't know numbers, so I'm going to spitball here. I think something like 8 to 10,000 people. Wow.

Starting point is 00:03:36 Maybe less. Don't quote David on that, though. Maybe less than that. Five to 10,000. Definitely, 5,000. 5,000 feels very safe. Yeah, I'm going to go with like 8,000-ish. But you're, and you're totally right.

Starting point is 00:03:47 And like, it is, I was talking to people about this at DefCon. It's not even like application layer stuff. There's not many, like, DFI apps, or NFTs conversations at all. The conversations are the Ethereum Protocol, EIP 4844, account abstraction, post-merge stuff, layer twos, like staking infrastructure. It is some, we are deep in the protocol,

Starting point is 00:04:13 deep in the protocol stack. Like we are not, this, the focus of this conference is like below the application layer. So like not even defy apps have exposure here. Are you seeing any suits? Any suits and ties? No suits. No suits. As he should be.

Starting point is 00:04:29 Sorry, all you suit wearing dapper, you know, gentlemen and gentle ladies, that's just, you know, it's nice to just kind of chill and be with the developers and kind of wearing whatever is comfortable. You know what's also been fun, Ryan? What? I don't think you know this. No, there are much a people that know that. But I can't have a little bit of Spanish. Yes. So, it's been a little bit of fun.

Starting point is 00:04:51 I've been practicing with Spanish. Wow. Well, done. How's it holding up? How's your Spanish holding up with the natives? Yeah, I'm bien. I live in Guatemala for two months. I've lived in Argentina for two semas.

Starting point is 00:05:06 So I've been like shaking off some rust, but it's been good. That sounds impressive, actually. Bankless Nation, rate David's Spanish right now for us in the comments. Tell him how he did. But you got to appreciate the effort, right? That was great, David. Well, anyway, we got a lot of topics to cover this week. The first is, of course, DevCon, what's going on?

Starting point is 00:05:27 There have been a slew of announcements coming out of DevCon that we got to talk about. Big announcements. Big announcements that people are super surprised by. Yeah, so we're going to cover that. Also, we have the B&B chain that was halted, halted after a billion dollar hack. David, are chain supposed to halt? Not the Ethereum chain, but we'll talk about whether it's appropriate for other chains. And finally, we've got the ultimate showdown, I think.

Starting point is 00:05:53 David Hoffman versus Janet Yellen. Yes, David Hoffman from the bankless podcast. We're going to talk about that. All right. David has been named as a co-plaintiff in a case against treasury, but it's not a bad thing. It sounds like a bad thing, actually, but it's actually a really good thing. We'll get into that.

Starting point is 00:06:11 And of course, as always, make sure you like, subscribe and review, wherever you're watching this, wherever you are listening to it. With your morning coffee. Here's my espresso with zero sugar or milk. Yeah. Oh, that's amazing. I bet the coffee in Columbia is pretty tasty, right? Yeah, it's pretty decent, yeah.

Starting point is 00:06:28 All right. Well, before we get in, I want to talk about our friends and sponsors at Galaxy. They want to invite you on a defy crypto adventure. It's Adventure Time in Crypto. David, what is Galaxy? What are these guys up to? Galaxy is your digital passport for exploring the Metaverse, exploring Web3. They have a bunch of quests and tasks and things to go do in the world.

Starting point is 00:06:52 of crypto, and once you go do those things, you get to log a little badge, a little gym badge, a little credential in your Web 3 passport given to you by Galaxy. So they are producing little things for you to go do, go and explore, the frontiers, if you will, to go and get some tasks done, and then you get to show the world that you did those tasks, that you are an actual frontier explorer and, you know, surface area for other opportunities, if you will. And so there is a link in the show notes to go get your Web3 passport from Galaxy, and you can start exploring different parts, different optimism, arbitram, wherever people want you to go explore. You can get paid to explore or at least get a badge, sort of like a po-up, to go and explore

Starting point is 00:07:36 the Metaverse. Yeah, some of these campaigns, as it were, they have rewards on the other side. So if you are a gold hunter, you can go check out those rewards. Also, that passport you're mentioning, David, that's actually a soul-bound token, which is pretty neat. I love it. these experiments with identity on chain using a sold bound token for this. So go check up. Don't trigger Evan McMullen too hard. Just a little hard. It's fine. That's galaxy.com slash passport to get to that. G.A.lxe.com is the URL. So Galaxy spelled GALXE. David, let's get to markets. Bitcoin this week. How are we doing? It's down. It's a down a solid 9%

Starting point is 00:08:21 So start of the week at 20,200, ending the week at 18,400. Oof, oof, oof. Down week, sad music. Okay, how about ETH? Down as well? Yeah, down a little bit more, down 10.5%. Start of the week at 1370, ending the week where we are now at 1240, 1220-ish, give or take. David, do you think we're going to dip on Eth below 1,000 again?

Starting point is 00:08:45 I mean, it's certainly in the cards. It's certainly in the cards, for sure. It's certainly in the cards. It's not going to say no, not going to say yes. I'm veering towards yes on that. I mean, if we roll back at the last bear market, we hit $80 and then we hit like $92 and then we hit like $95 across like 18 months of time. What's our low right now on Eith?

Starting point is 00:09:10 I think it's like $800. Yeah. And that was a quick spike. And your boy bought $897. So that is the best bottom tick I have ever done. All right. So David timed the market really well at that time. But maybe we'll be below that. For now. For now. I can't wait to beat David and buy $800. What'd you buy? Shush. Get out of here. What'd you buy? 800. So I'll do $8.97. You're going to set your limit orders for $8.96? Yeah. Yes.

Starting point is 00:09:39 I'm going to set my limit orders for 895. And on we go. And this is how we end up with no cash. This is how you get price discovery. I guess we're laughing about this, but it is a pretty steep bare market. I mean, like, at these prices, we are below the all-time high of the last cycle, which was like 1440, something like that. So we'll talk about why this might be the case. It's all screaming macro to me.

Starting point is 00:10:06 How about the eat the Bitcoin ratio? Are we down on that too? Yeah, down a little bit, 2.5% down to 0.663. And how's the crypto market cap holding up overall? No longer being measured in the trillions. We are now at $934 billion. So well below $1 trillion market cap. We lost our T status.

Starting point is 00:10:28 We back to the bees. All right, well, let's talk about macro, okay? Because this is the cause of some of our problems. Why is this happening to us? Why is this happening to us? Why us right now? Of course, crypto, crypto goes in cycles. But I think one of the catalysts and the things that are preventing some of the crypto markets from rising again is uncertainty in macro. And boy, there's a lot of uncertainty these days. The big news this week was the CPI number,

Starting point is 00:10:54 that is, the September inflation report just came out. And David, the numbers are higher than expectations. The CPI Consumer Price Index rose 8. point two percent in the year that is annualized through September. I think expectations we're hoping for 8.0, 8.1. So a little bit higher on that. And we're still in the eight range, David. So not good. I guess just to recap, in August, we were CPI of 8.3 percent. That's annualized, of course. In July, 8.5 percent in June, 9.1 percent. So from June to September, from the annualized perspective. We went from 9.1% to 8.2, so we're still down, but, you know, we're not down

Starting point is 00:11:44 as much as some analysts. And I think the market was hoping for and expecting. And so, do you know what this means, David? Numbers go down. And also Powell wants one number to go up, which is the interest rate. And so the next Fed meeting is November 2nd. The market's anticipating another 0.75 basis point hike. So that is definitely coming down the pike for us. And yeah, I mean, this is just simply like rate hikes will continue until inflation comes down, right? So this is like pretty straightforward, I'd say. The beatings will continue until morale improves. And so we've got some more beatings to go through from the Fed. It's an interesting question. I think a question that we

Starting point is 00:12:30 want to bring some macro folks here to answer on bankless, which is like, is this actually effective, can you break the back of inflation by raising rates? I mean, the story, the narrative, keeps going back to like Volker, the Fed Chair, the 1980s, who allegedly broke the back of inflation. Is that really what did it? Or conditions different? Or there are other factors at play? I would love to get in a conversation with somebody on the macro side about whether this strategy is actually effective. But in the meanwhile, David, you could see the sell-off, the sell-off event when those numbers print tire. Those are some large down candles.

Starting point is 00:13:10 Yeah. This is the S&P 500, gold, Bitcoin, and euro all just tanking in a single candle as soon as this report came out. Exactly. Global correlation. Yeah, this is one of those moments where like correlations all go to one when times are bad. That's exactly what this looks like.

Starting point is 00:13:26 Yeah, that's what's happening. But I will tell you one thing, which is kind of interesting, is how crypto is faring relative to traditional markets. Here's kind of one stat. So after the CPI numbers came in, the U.S. 30-year bonds were down 2.5%, as you might expect, so bonds go down. But also, ETH was down 2.5%. It was interesting. Like the risky asset, you'd expect ETH to go down by 2.5% or a lot more.

Starting point is 00:13:59 It was down the same amount as bonds. Bonds are supposed to be the stable asset. they're not performing as the stable asset in this market. So I start to wonder if, like, we'll have crypto markets bottoms, is our, you know, is prices and some of the volatility shifting to more of the traditional markets? That could be what's happening. My take here is that the hot air has already left the crypto industry. And so when macro goes down, we're also going to go down with it, but we're not going to go down in an outsized way. Like, we went down in an outsized way from January to May of 2022. And then everyone got liquidated. And now we've kind of

Starting point is 00:14:38 like found some sort of floor-ish. And as that floor lowers because of macro, we will follow that floor down. But we're not going, we're not going to like puncture through that floor in the same way that we did in the first half of this year. That's my take. I largely agree with that. I think crypto already took, took its licking and got beaten down. And now traditional markets are taking theirs. This is a tweet from zero. People are underappreciating the fact that we do not have. another three-hours capital leverage event. And like maybe we do because you don't really know if you have one of those or not. So it's kind of impossible to claim. But I don't know, man. Like if it had happened last time, like we already did that. I can't imagine there's a second

Starting point is 00:15:17 one. The things that are still standing are now on much more firm solid foundation. This is a tweet from Zero Hedge. The Fed finally did it. They broke the market. The Dow Jones, which is, of course, the 30 largest industrial stocks in the planet, is now officially more volatile than crypto. This is a volatility index of Dow Jones and crypto versus US dollars. And so the stock market now performing with more volatility than crypto, that lends a bit more credibility to what you just said, I think, David. Yeah. And this is a theme that I have been trying to just get into people's heads, because I think it's the right theme where, and I've said this in a number of different capacities, where crypto is becoming more and more suitable for mainstream while the mainstream world is

Starting point is 00:16:04 needing crypto more and more and more. And this is related to like our Web 2 versus Web3 apps, like Facebook algorithms, rage algorithms are like pushing us and like, oh, I kind of understand why we need Web 3 a little bit better. Like there's an adoption story here. The other time I've articulated this is that like normal, the normal world is getting more chaotic as crypto is becoming more stable. And that, and so I'm taking, this is me taking a victory lap, Ryan.

Starting point is 00:16:28 Like when the Dow Jones is more volatile than Bitcoin, like this is the old world's getting more chaotic and crypto is getting more stable. And this is going to be one of the great. If it's like the Benjamin Button like me, like we were crossing and now crypto is like the same age. Yeah. Yeah. Yeah.

Starting point is 00:16:45 I totally agree with that. And I think what you're saying is the victory lap is not that you're happy that Dow Jones is going down. But you're kind of saying like, you predicted that all the naysayers who said, look, crypto is too volatile for mainstream. Like we've, we've long said, people in crypto have long said, just wait, the whole world's get more volatile, and that volatility is coming to you as well. And crypto is just a bit more of an honest market in terms of pricing that in early. And I think that that is exactly what's happening.

Starting point is 00:17:13 This is another tweet from Jim Bianco. This is the early 20, he says this, the early 2020 pre-pandemic peak in the S&P 500 was 3,393. As I write, and he's writing October 13, so this is on a Thursday, as I write, the S&P 500 is 3,493, 100 points away from erasing the entire post-pandemic bull market. We just erased that entire pandemic bull market, all the money printing that went to stocks. It's gone now. We're back to where we were in early 2020. That's pretty astounding when you think about it that way. Yeah, that is quite astounding. And it's also worth noting that in early 2020, ether was $100 and Bitcoin was like $4,000 or $5,000. And so like crypto has made significant strides

Starting point is 00:18:06 in the same time that the legacy markets has just gone full circle. Yes. And despite it, of course, if we're looking at now the speed of the U.S. interest hikes, look at this. 2022, the fastest speed at which the Fed has ever increased interest hikes, at least ever in kind of like modern history, it seems like. So they are on a tear to increase interest rates and no signs of stopping yet. We'll see if something breaks before they do. David, meanwhile, on the crypto monetary policy side of things, ETH went ultrasound last week. Talk about that for a minute. Yeah, so last week, since the merge, we had issued 13,000 ether, about 13.5,000 ether. So last week, the new post-merge ether issuance was 13,000. Today, seven, eight days later, the post-merge ether issuance is

Starting point is 00:19:01 7,100. We have burned about 6,000 ether in the last seven days. And so where we have been previously up to last week, we were inflationary. The last seven days has been extremely deflationary. We've almost cut out 50% of all issuance in the last seven days. And this goes back to what I was saying last week. It's easier to burn ether than it. is to issue it and you can recover a significant amount of ether issuance in a short amount of time. So we've taken three weeks of issuance and like deleted it inside of one week. Previously, I think the issuance rate of ether, the inflation rate, it was 0.22% up until at the very peak. We are now down to 0.08% in since the merge. And so this is really cool. This is really,

Starting point is 00:19:49 really cool. The less cool thing about it is, okay, why is this happening? Why are gas prices sustaining 30 way and sometimes getting up to 100 again? It's because of a Ponzi. Zen crypto. Zen crypto thing. Yeah, I actually haven't looked into it myself, but this is the discussion at DevCon. And so I'm kind of regurgitating what I heard is apparently this is like the new Ponzi thing. But this also goes back to my other take that Ether is the index of Ethereum and you don't have to buy every single token to have exposure to Ethereum. Maybe this point. Ponsie just comes and goes. You should not buy every single token.

Starting point is 00:20:21 Definitely not. Yeah. Maybe this Ponzi comes and goes, but it's burnt for almost 5,000 ether along the way. And so, yeah, cool. It is really cool. Generalized exposure to Ponzi's, nice. Well, this is in other things among them. But like this is an example.

Starting point is 00:20:39 So, Eth was ultrasound on the week. It's not ultrasound overall since the merge. But it could easily, like, you get another week like this and it basically is. And what we're talking about, of course, again, a 94% issuance reduction post-merge. And that has not been priced in from the markets at all. And the reason is because during bear markets like these, demand simply vanishes for ether as NASA.

Starting point is 00:21:03 Everyone's kind of scared, so demand vanishes. But in the backdrop, a lot of supply is getting eliminated as well. And so once that demand recovers, I would expect to see some like rocket ships back up because we have much less supply to work with and there's much less availability. I think that's the right take. I think ether burned, ether removed for the market. I don't think does too much when prices go down.

Starting point is 00:21:29 Like I don't think this eth burn is going to save ether from setting new lows. It's not. But once demand comes back, like you said, it becomes, the upside becomes highly sensitive. And so it is easy to recover price, I think, as soon as there's any amount of like meaningful new buyer, net new buying. of ETH. I think that's right. Guys, we have a lot more coming up in the roll-up. David's going to get to all of the DevCon announcements that he saw well in Bogota.

Starting point is 00:21:54 And also, I'm going to talk about the Binance Smart Chain Pause. Why did it pause? What happened? Did they roll back the chain? Talk all about that. And then Hoffman versus Janet Yellen, the fight of the century. It's coming to a court near you. David can't talk about it, but I can. And I'm going to all of this and more coming after we talk about these fantastic sponsors that made this episode possible.

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Starting point is 00:24:04 A lot of big announcements coming at DevCon, mostly on the protocol layer of things as we were talking about in the intro. David, you want to take us through a few of these announcements? Yeah, 100% because they're really cool stuff. This is the building being expressed here at DevCon. So we'll start with this one. This is at Liam on Twitter. Last night, and he's from the scroll team, last night we officially announced the upgraded version of our ZK EVM TestNet over at Scroll. This is a huge milestone for both the scroll team and incredibly early community. Let's break down with this upgrade means for developers and users. And there is a tweet thread in the show notes if you want to learn more. Scrolls ZK EVM TestNet. that is debuted. And so if that is interesting to you as a developer or a tinkerer, that is now something that you can go play with. And so congratulations to the scroll team. This is definitely, the ZK rollups are definitely a very hot conversation here in Bogota and overall in the crypto space. And I mean, this is scroll between scroll polygon and ZK Sync. This is like one of the, one of the big three of the ZK EVM teams. And now we got a ZKEVM on test net ready to go.

Starting point is 00:25:12 Wouldn't you also add Starkware maybe as a fourth? No, no, Starkware is not a ZK EVM. Not a ZK EVM. You know, because they don't actually have an EVM because you have to kind of write it in Carrio. Is this why? Yes, correct. They are a non-EVM compatible ZK roll-up, yes, correct.

Starting point is 00:25:37 This is actually coming faster than I thought. Super fast, yes. Big move for scroll. And they are purporting to be the. most EVM equivalent of them all, of course. Yes, that is their competitive advantage. That is their like angle. They are a trying to be as EVM equivalent as possible beyond EVM compatibility.

Starting point is 00:25:56 And so there is a fight for EVM equivalents. Our optimism and arbitram are fighting over EVM equivalents. Scroll and Polygon are fighting over EVM equivalents. ZK Sync is specifically one firm in the EVM compatible camp. that is their competitive advantage, a little bit in the same angle as like why Starkware one is wanted Cairo, a little bit highly optimized language

Starting point is 00:26:20 or just some kind of tinkering. But ZK Sync is like a little bit in the middle. Like definitely want to maintain EVM compatibility, but they think that they can make optimizations that are better than the ZK EVM or an EVM equivalent roll up. So that is their, that's their territory. Well, speaking of Arbichum,

Starting point is 00:26:41 which you just mentioned, they had a big announcement too. What are they talking about? Yeah, this is huge. They have acquired Prismatic Labs, Prism, a layer one client. We have a layer two optimistic roll-up, acquired a layer one client team, which is crazy. No one really thought that you could really do this. And so this has caused a ton of conversations in the space as to what this actually means. But Prism is like the most used client in Ethereum. One of the few people, the first teams, to come out and build, start building an ETH2 client, which is now what we call Prism. And that got acquired by Arbitrum.

Starting point is 00:27:18 So Preston Van Loon, Raul, all of the prison team, I think there's 10 or 15 of them, is now under the Arbitrum umbrella. And they are, of course, going to continue working on Prism. But now Prism is just a product of Arbitrum. This is kind of cool in that it kind of means funding secured, right? Like business model secured for the team that's building a crucial client. And obviously this is very good for Arbitrum. And I believe Arbitrum when they say they're going to continue to support this

Starting point is 00:27:51 and continue to maintain its credible neutrality. I think there have been some concerns about this, though, is what happens if a layer two team kind of maybe tries to bias the layer one client in some way? Or is this unfair to other layer two? So there's been some of that. I don't know what to make of that. We don't necessarily need to get into the arguments, but what I will say is the feedback that I've heard from Raul and Preston Van Loon and others is they're just excited about this.

Starting point is 00:28:17 And I know those individuals are here for the right reasons. And I don't think they'd be excited unless they had a path to preserve the values of a theorem that they really care about. So I'm pretty optimistic about this overall. I actually had the opportunity. I was in a cab with Preston for like 20 minutes where we kind of talked about this. So I can regurgitate some takes here. I'm going to see if I can get him into an actual interview right after this over at DevCon. But we are also hosting Preston and Steven from Arbitrum and Prismatic on Tuesday,

Starting point is 00:28:48 this next Tuesday for State of the Nation to talk all about this. But Preston, like one of the big reasons why he's so excited about this and the whole team is him and Raul were running a company, right? They were managing like the grants incoming from the EF where they were previously getting funding for and they were doing like HR and like paying salaries and like, normal company stuff, but they're builders. Like, they just want to tinker. And so now that they are being, like, put under the larger arbitram umbrella, like, they don't, he doesn't have to, like, do any of the business operation stuff, uh, which I think he like, you know, if, if you're a

Starting point is 00:29:21 builder, you just don't really like to do that. Also, like, salary bonus. Salaries are going up because they're going from grants to like, EF grants to, again, under the arbitrum umbrella. Uh, and I mean, they also get, they also get to, uh, just like be financially compensated for all of their hard work, which, you know, grants aren't a business model. Yeah. But so like, so everyone's like super happy about it over on the PRISM team. That's cool. Look, and if worst case scenario, they're not going to go evil, but if they ever went evil, it's open source code. Some of the team could fork it and take it and run with

Starting point is 00:29:52 it. So I think that's a net win for the ecosystem. David, speaking of net wins. The makers of ZK Sync just launched their layer three test net. Now, Steve from ZK. Sink was talking all about layer three on a state of the nation that was. we recorded with him a couple of episodes ago. And they're already on TestNet for this. What is, what is this announcement telling us? Yeah, so ZK Sync's main net is coming in like 20-ish days.

Starting point is 00:30:20 We might actually be in the teens on that. So ZK Sync is actually much further along than the other two ZKEVM teams, scroll and Polygon. So their main net, their ZKEVM main net is coming very soon. And so they have, their announcement today is that their layer three, test nets, which are their app chains, their hyperchains, whatever you want to call them,

Starting point is 00:30:41 their test nets for layer threes is now going live. So they are like a decent step ahead of the other layer two teams because they are now working on their layer threes. This is the same conversation as to keeping DYDX on Ethereum. DYDX had to leave Ethereum because they wanted to produce their own app-specific chain on Cosmos because layer threes were not ready yet in the side of the Ethereum ecosystem. And this is, this layer three test net is that what would have been a solution for for DYDX. And so they're calling it Pathfinder. And so this is now whatever it means to have a layer three test net. I'm not too sure. But it is now available for you. So another big announcement from a polygon as well, which we weren't really sure when their public test net for

Starting point is 00:31:28 the Polygon ZK EVM would go live. And it looks like it just went live at DevCon. So while ZK Sync is close to shipping on Mainnet, it'll be a guarded release, by the way. It's a mainnet without any apps. It'll be kind of like, yeah, yeah, for for ZKSink anyway. Developers first. We won't be able to use it for a while until they kind of, you know, release the floodgates. But meanwhile, from Polygon ZKEVM, their test net just went live as well. Any takes on this announcement? You know, again, this is this is why the meta right now is the ZK EVM. And the Vitalik, I remember at Roll Up Day, which was a roll-up themed conference, one-day conference hosted by Scroll,

Starting point is 00:32:13 Vitalik gave his presentation and talked about just like, yeah, the ZK teams have really astounded. They're shipping. They're shipping hard. Yeah, he was giving this narrative about like how the ZK EVM, the ZK roll-ups were like, like going to be here in like 2025 to 2030, like sometime around there. But bam, no, they actually came in 2022. And he said it's the one time that you actually see development is super accelerated beyond. Like, you know, the merge was delayed.

Starting point is 00:32:44 Sharding's not even here yet. Everything about Ethereum has been delayed except for the ZK EVM teams. And you can see this all happening all at once at DevCon. Everyone saved their announcements to DevCon. The ZK EVMs are basically here. And so while, you know, we're all frustrated that like Ethereum, development is slow, even though, like, cool, now we have the merge, so I'm not really going to complain too much. The ZK layer 2s are here, and they are super exciting. It's not just about cheap and fast transaction

Starting point is 00:33:12 fees, Ryan. There's so much new doors that are opened up on a ZK roll-up. More content on that, and the overall bankless ecosystem coming soon. We at bankless are cheering all of these projects on. Way to go, everyone. Quick disclaimer on all of these projects that we just mentioned, Ryan and I are an investor in Scroll. Ryan, I believe, is an investor in Arbitrum. We are both advisors to ZK Sync and Ryan is an advisor to Polygon. So we are very, very involved in this layer two ecosystem.

Starting point is 00:33:43 And so those are those. And also David holds some ETH. He's been known to hold a little bit of ETH. Oh, yeah. Also related to ETH, I also hold ETH. Disclaimers out. Kevin O'Waqui, he tweets this. I'm pleased to announce the launch of Super Modular.

Starting point is 00:33:59 X, Y, Z. We are a venture studio that builds Regen Web3 projects, often on top of adjacent and adjacent to Gitcoin's protocols. What is this from Kevin O'Waki. What is super modular. This was announced to DevCon. Yeah, so Kevin O'Waki, the founder, former CEO of Gitcoin is, and Gitcoin is now a protocol. It is now a Dow. It is on its own. And he's largely stepped back from the Dow. kind of in the same way. Satoshi steps back from Bitcoin and Vitalikset has stepped back from like writing code. He's even made time for a podcast, hasn't he? He's even made time for the Green Hill podcast. And so Gitcoin is up and running and just chugging along. And so now Kevin, the perma builder that he is, has founded a centralized company that exists on top of the Gitcoin protocol. So I think super

Starting point is 00:34:47 modular, the way to explain it simply is like the consensus for Gitcoin, a software studio that builds on top of the Gitcoin protocol. So Kevin O'Walky just can't stop building a founder and CEO yet again back building out something centralized on top of the decentralized protocol that he helps do it. So just Kevin O'Walky is just like, well done, sir. And I also think this is just a great model of something that we see, I think we will see. And we have seen before and we will see again of founders building something, letting it become decentralized and then building a centralized company on top of that decentralized thing. This is what we've seen with Hayden Adams and Uniswap.

Starting point is 00:35:26 So Hayden Adams built Uniswap, release it to the wild. Now the Uniswap Dow is in control of Uniswap. And now he's the CEO of Uniswap Labs, a software company that is building on Uniswap. And so I think this model is going to be something that we're going to see over and over again into the future. I totally agree. And I think it's a great model. All right.

Starting point is 00:35:44 Well, meanwhile, this is everything that's going on on DevCon. And I think you've got some more stuff to say about DevCon a little bit later. but maybe we should talk about another event that happened this week, and that was on the Binance chain. So, sorry, the BNB chain, I think they've rebranded this, is not the finance chain. Here's a tweet from BNB chain, the Twitter account. Due to irregular activity, we're temporarily pausing BSC.

Starting point is 00:36:06 We apologize for the inconvenience. We'll provide further updates here. Thank you for your patience and understanding that happened. That tweet was petted out on October 6th. Was that last Friday, David? Yes, I believe that's right. And then they also follow up that. tweet to say, to confirm, we have suspended Binance Smart Chain after having determined a potential

Starting point is 00:36:25 exploit. All systems are now contained, and we are immediately investigating the potential vulnerability. We know the community will assist and help freeze any transfers. All funds are safe. Interesting, because all funds were definitely not safe, Ryan. All funds were not safe. Okay, so first of all, maybe we'll talk about the exploit itself and what that was. But let me just park this, because we'll come back to it later. How bizarre is it that a Twitter account representing the chain itself can tweet like, hey, something went wrong, we just paused it. It sounds an awful lot like a centralized exchange to me.

Starting point is 00:36:59 Like, you'd expect this from Coinbase. You'd expect this from FTX. Something happened. We're pausing things. But on a blockchain, a little bit weird. Like, the Ethereum Foundation, we're pausing the Ethereum chain because, I don't know, someone hacked their own inside chain.

Starting point is 00:37:15 Like, what the hell? You're not supposed to be able to pause a chain. But let's talk about what action is. happened. Here's an article from Decrypt. DeCrypt reports that $566 million of BNB tokens were stolen from a bridge. So this was a bridge exploit, a bridge attack. And then they froze the chain. And so once the attacker got their hands on an extremely large sum of money, they started to transfer it out as fast as they could and all the different other bridges. So they bridged out to Arbitrum. I think they also bridged out to Optimum and they bridged out to Ethereum.

Starting point is 00:37:50 But then they froze the chain. So the hacker managed to get away with $110 million. And then about $430 million was frozen and now is back in the custody of the Binance smart chain operators. And so the freezing of the chain did save $430 million. But the hacker has like $110 million of various crypto assets across the space because they bridged out. And so, oof.

Starting point is 00:38:16 Yeah. Oof. Yeah. This is a summary of the hack. So since the BNB chain was suspended, the $430 million on it cannot be transferred any further. And this tweet goes through kind of all the details include that in the show notes.

Starting point is 00:38:33 This is from Sam CZ Son, who kind of goes over the hack in what actually happened. And it appears, David, that the summary here is something went wrong. There was a bug in the bridge, the Binance Bridge itself. So there's a bug in the way that the Binance Bridge verified proofs which could have allowed any attacker to forge arbitrary messages. I went through the Sam Z. Sun thread and it was an extremely sophisticated bug.

Starting point is 00:38:59 It was, I mean, I generally don't understand. Hard to find a bug. It's a very hard to find bug, hard to reproduce. I think this bug has been in Binance Marching since the beginning, which is kind of the crazier thing. So yeah, this is like top. It's been in the bridge specifically. Yes, it's been in the bridge.

Starting point is 00:39:16 It is a 10 out of 10 complexity. level bug. So wow, crazy. So chain halted, everything frozen. The good news is, if you think this kind of thing is good news, is that they were able to get back a lot of the funds, I think. How much of the funds was Binance able to kind of like recover or freeze or was the hacker prevented from getting away with? About a little over $400 million, $430 million. Yeah. So the hacker got away with a 110 million. 110 million, though. That's a large, large amount.

Starting point is 00:39:53 Yeah. So, okay, so what do you think about this? I mean, there are some people outside of crypto looking at this and being like, well, I'm glad the hacker didn't get away. Are you guys crazy? The cops were on the beat. They froze the chain. They stopped the hacker from getting, what, do you want the hacker to get away with like half a

Starting point is 00:40:14 million dollars? And who knows who the hacker actually is, right? The last time on the Ronan side chain turned out to be a state apparatus of North Korea. Do you want these types of events to happen? And here you are on bank lists saying like, oh, it's out of character of crypto values for a chain to be able to layer one chain to be able to freeze things. Well, are you sure about that? Do the ends justify the means in this case? What's your take with that argument?

Starting point is 00:40:42 Yeah. I mean, this doesn't, I don't really think this surprises many people. We, Binance Smart Chain, there's that meme about like, you know, the, the CAPTCHA of like, you know, select all of the Binance Smart Chain validators. And then there's the meme of like, select all of the Binance Smart Chain. Like, we know that this is the state of Binance Smart Chain. This isn't really surprising to anyone. that it's centralized, that they have the ability to freeze, that they will freeze if an event like this happens. You're saying no one was really surprised. We all knew this. Yeah. And so like I think that has been in the social contract of Binance smart chain. And so when we say like, yeah, this is against crypto values, well, yes, in one way, it's definitely against Bitcoin and Ethereum values. I don't think it's necessarily against Binance Smart Chain's values. There's a certain

Starting point is 00:41:24 social contract that Binance Smart Chain has. And I think there's no secret that it is centralized and like possible. And the fact that, that we have Ethereum, and again, Binance Smart Chain is an EVM fork of Ethereum, and then it's just juiced up Geth, so it goes super fast. We have the unreversible, immutable, decentralized version of that

Starting point is 00:41:44 is called Ethereum. And so I don't... We don't need B&B to be that. Yeah, we have that option. So if you would like to express those bankless values, you probably transact on Ethereum. If you prefer the more,

Starting point is 00:41:58 like a certain kind, a different level of settlement assurances in the sense that you trust that Binance smart chain operators like CZ will be benevolent and do things that will prevent hacking and loss of funds and return. If you're an investor and you see like Binance smart chain halted and gave money back to investors that were innocent, that might be compelling to you for some certain set of people. And so my take is that because we have Ethereum, I don't really care so much about Binance doing this. I would be much more cautious and much more like reserved if like they were

Starting point is 00:42:36 like freezing funds of like the Uyghurs because the Chinese government told them to. That's a different story. But that could, but that could happen next, right? To be fair. Now you have these these these buttons that centralized validators can press and have the ability to freeze. You'd expect that they wouldn't just be used for for hack type situations, right? But but largely I agree with you. I think what this does, though, is it really reveals that B&B chain is a separate type of platform, separate type of application versus something like Bitcoin or Ethereum, right? And so it is a bit more like a bank. It is a bit more like kind of fintech.

Starting point is 00:43:13 And I actually don't see a lot of difference between something like B&B chain and an actual bank with a set of open APIs that you can build on top of. It's very similar. VIRs in that direction. It's kind of like fintech. where I have a problem is when people mistakenly think that they're getting into defy, when like, or like that this thing is built on, you know, a permissionless base layer. And really what you're kind of building is on a, you know, a set of validators,

Starting point is 00:43:42 kind of like a bank API. That's where I have a little bit of the issue when it kind of masquerades or cloaks itself as being decentralized. And it's really, it's not nearly as decentralized as something like Ethereum. You could build on top of it. Maybe it's permissionless. Maybe it has some open APIs. But you can't put it in the same category as a Bitcoin or Ethereum.

Starting point is 00:44:01 Right. And you touched on it just there, but just to drive that point home. And I guess I'm defending CZ today. It's permissionless to access. It's permissionless to build on. It's like permissionless by default. But like on a bank, for example, you can only do certain things and you can't do anything else.

Starting point is 00:44:20 On Binance smart chain, you can do whatever you want with the potential that CZ will stop you from doing that later. But you can enter, you can enter Binance Smart Chain and do things freely in the same way you can with Ethereum. You just know that like, hey, you might get stopped after the fact.

Starting point is 00:44:36 Where a bank stops you before the fact, Binance Smart Chain stops you after the fact, and then Ethereum doesn't stop you at all. So like it splits the difference between Ethereum and a bank. Well, what's interesting to me is like some people will say, well, David Ryan, that's what users want.

Starting point is 00:44:51 I mean, they want some level of protection. And like, I hear, that and I agree with you. And I would say if you're a user that wants that, go use finance chain. But what I actually think is that the true users of layer one block space aren't individuals like you, myself, or like bankless listeners right now. They're actually other chains. And so the true users of layer one block space are going to be the ZK EVMs, the optimisms, the arbitrums, right? And the question for these chains is, what chain are you going to build on top of? Are you going to build on top of a chain where a small

Starting point is 00:45:24 set of validators can like freeze things. Well, if you are, then you are completely giving up your sovereignty. You're not building on a credibly neutral censorship resistant base layer, right? And so that is more kind of what I think. If you're a user, go use whatever chain that makes sense to you, like recognize these tradeoffs. But if you're a chain, which is where the big blocks based consumers are going to be in the future, you sure as hell aren't going to build on something like B&B versus something that is much more immutable and has higher security guarantees. Yeah, basically what you're saying is that these choices, the specific social contract of finance smart chain puts a limit as to like how much value can this thing actually host.

Starting point is 00:46:05 Like how much? What is the total addressable market? The total addressable market of pure, strong immutability and strong settlement insurances is much larger than weak settlement assurances. People can trust Ethereum much more. And that's fine. And that's the same take that I have about Salana. why Salana needs to stop going down because of settlement assurances. You need to be able to have

Starting point is 00:46:25 assurances that your value is secured. And Ethereum has that market pretty well cornered. I will say like Ethereum, like if you're using Ethereum, I would consider you a user. If you're using Binance Smart Chain, I would consider you a customer. I would use semantically. Oh, that's interesting. Yeah. I would semantically define it like that. Yeah. I kind of like that distinction. I think it draws the right mental models in people's mind. All right, speaking of distinction, speaking of mental models. Actually, there's no segue here at all. I'm just going to say it.

Starting point is 00:46:57 David is suing the treasury, guys. All right? I'm going to kind of lead this story. This is a post from the block. Coin Center sues treasury over tornado cash sanctions. Of course, you know CoinCenter. They are a crypto-friendly legal group, lobbyist group, based in D.C., we've talked about them often on bank lists.

Starting point is 00:47:15 We've had folks like Jerry Brubes. Brito and Peter from Coin Center on the podcast to explain what's going on in D.C. And guess whose name is in this article? Guess whose name is on the lawsuit? My own co-host, if I can find it. David Hoffman. Where are you? There he is.

Starting point is 00:47:33 David Hoffman says, and David Hoffman, a digital asset manager. There you go. A digital asset manager. But let me read what's going on here. This is from Jerry Brito from Coin Center. He is the lead at CoinCenter. Today, CoinCenter filed suit in federal district court against OFAC. That is a branch of the Treasury, challenging its authority to sanction tornado cash immutable

Starting point is 00:47:57 smart contracts. You guys remember that. Tornado Cash was sanctioned. So no U.S. citizen can legally use tornado cash, a privacy mixer on chain on Ethereum. Jerry goes on. Not only are we fighting for privacy rights, but if this precedent is allowed to stand, OFAC could add entire protocol. like Bitcoin or Ethereum to the sanctions list in the future,

Starting point is 00:48:19 thus immediately banning them without any public process whatsoever. This can't go unchallenge. Can you imagine that? The slippery slope here. We intend to win this challenge, even if it's necessary to go to the Supreme Court and we'll keep you posted as the case unfolds. You can read more about our suit here.

Starting point is 00:48:37 A big thank you to our co-plaintist Patrick O'Sullivan, David Hoffman, and another Twitter handle here. And this is the actual filing itself. This is the first page on it listed as plaintiffs are Coin Center, Patrick O'Sullivan, John Doe, and David Hoffman as plaintiffs versus Janet Yellen in her official capacity, a secretary of treasury, department of the treasury, and it goes on. And the entire complaint is listed here. I might read some sections on it. But David, I know you can't say everything about this case is a co-plaintiff. plaintiff. But what can you tell us? Why did you get involved in this? And what specifically is your

Starting point is 00:49:20 role as a co-plaintiff? Like, what are you filing this complaint against? Yeah. So, yeah, so I'm suing Janet Yellen in Treasury because I received the dusting from tornado cash to David Hoffman. I don't know who sent it to me. Permissionless Ethereum. Send me money that is now OFAC against OFAC sanctions. And so as a result of that, because somebody has sent it to my public address, which I couldn't prevent them from doing that, I now have to, I had to file a report with OFAC saying, hey, somebody did this to me and to take time out of my day, file this stupid report, like do all these stupid things. And then every single year, Ryan, for the rest of my life, I have to do it again. And so next year, I'm going to have to file the same report saying,

Starting point is 00:50:04 hey, still have this illegal money. I still control it. It's still in my wallet. I'm not a criminal. And I have to do that next year. And I have to do that the year after that. and then I have to do it the year after that and the year after that for the rest of my life. And the thing is, Ryan, if somebody sends me ETH from $20 to cash again, I have to do that again every single time. And so I'll file two reports and I'll file three reports. And so like the Treasury as a result of their, in my mind, illegal listing of a smart contract, which I can't do in my mind, in my opinion, I have to spend my life, my time,

Starting point is 00:50:38 doing this stupid bureaucracy stuff that I don't think I should have to do. And so this is an injury, and I'm suing Janet Yellen in the treasury. It's not only that, as I understand it, David, it's unclear whether those that were dusted yourself included, but also like some celebrities, right? Jimmy Fallon, I think, was dusted. It's unclear. Shaquille O'Neal. It's, you're fighting for all of them. You're fighting for Shaq.

Starting point is 00:51:04 You're fighting for Jimmy Fallon. I don't want them to have to waste their time either. It's not just wasting your time. I know that's a part of it. But it's also, as I understand it, Treasury has not said whether they could legally, like, legally, it seems like Treasury's stances, you are breaking the law even by receiving this. And so if you file, then you are a good citizen. Thank you very much.

Starting point is 00:51:26 But they're only committing to deprioritize charging you for this illegal action that you've undertaken. And what is the illegal action? Receiving some dust that somebody sent you and these other individuals without their permission from tornado cash. So this is awesome. I am so glad that Coin Center is stepping up here. David, it's awesome that you do in this, man. Like, I appreciate it. We appreciate it. The bankless community appreciates it. It's bankless AF to take this to the court system. And I'm proud of you, dude. Like, this is really cool. This is, I think this is a cool moment for crypto. By the way,

Starting point is 00:52:04 I will say, this isn't the only lawsuit that we have. So we have two irons in the fire as a crypto industry. So there's the coin base lawsuit that's going on in parallel. And then there's this one from Coin Center. And I think that the hope is we have two irons in the fire, two approaches. One of these either wins or it gets all the way to the Supreme Court and then something happens. And the big macro fight here is the question of whether an American citizen can have on-chain privacy or not, all right? And we have these rights on the internet. I want you to know, every time you use encrypted communication protocol like HTTP or something like this, you send encryption without a social media company spying on you or without the government

Starting point is 00:52:51 spying in you, every time it's encrypted, we have that in our communication protocols, right? Are we going to, as a country in the U.S., allow citizens to have this in our value transfer digital protocols. That's what's at stake here. And if we lose this, as Jerry Brito was saying, we might lose the larger battle of having a censorship, making it, they could make it illegal to run an Ethereum validator in the U.S. for instance, right? That is kind of the slippery slip. Why? Because unless you're running an OFAC, you know, OFAC sanction compliant ETH validator, you are maybe breaking the law. right so we have to take this to the court system it's a big bold move uh and uh i just want to say on the behalf of the the whole bankless community everyone in crypto we appreciate it man and we're

Starting point is 00:53:43 we're cheering you on um i know you can't talk about it very much more uh the good news is i can all right so i'm going to be keeping the bankless nation updated a bit more and in addition guys to cheering david on what you can also do is donate to coin center because they are funding all of the legal expenses to make this happen. David, as I understand, this is not coming out of your pocket, right? So they're funding this. They are, they are representing, they're paying all the legal fees to take Janet Eland and Treasury to court over this. Is that right? Yeah, that's correct. Yeah, I could not do this without their support. So like, it's like David's face in the front, but it's entirely coin center in the back.

Starting point is 00:54:23 Coin center mullet? Yeah, the coin center mullet. Yeah. So thank you, CoinCenter for all of the support and helping Spirit had this. CoinCenter.Eath is where you can send money for, if you would like to contribute. At DevCon, people, this went out and so while I was walking around at DevCon and people were going up and hey, like, congratulations on like the lawsuit. I'm like, oh, I guess congratulations. But seriously, you know, congratulations. And I think it's going to take all of us kind of standing up if we're going to be able to protect our digital rights in the 21st century here. And a quick speed run through that, remember that before Bitcoin,

Starting point is 00:54:59 episode that we did. Like we got we cryptography was made available because of a series of lawsuits that individuals sued the government and won in court. And that is why we have cryptography. And now we're just 1980s, early 90s. It was on the back of giants that we actually have the rights that we have today. And now we're doing it all over again, but now with cryptocurrency. So running it back. Let's make history. All right. Coming up next guys, we got a lot going on, including a whole bunch of hacks that happened. October was Hack Month in crypto. Also, PayPal getting a little authoritarian. Also, PayPal is going to find you $2,500 if you're politically incorrect. Maybe because you said something on Twitter. We'll talk about that story. It's partially true. Partially they've walked it back. And also,

Starting point is 00:55:47 the SEC is coming after the board apes of Yuga Labs. We'll talk about all of that and more when we get back. But first, we want to thank the sponsors that made this episode possible. Arbitrum 1 is pioneering the world of secure Ethereum scalability and is continuing to accelerate the Web 3 landscape. Hundreds of projects have already deployed on Arbitrum 1 producing flourishing defy and NFT ecosystems. With a recent addition of Arbitrum Nova, gaming and social daps like Reddit are also now calling Arbitrum home. Both Arbitrum 1 and Nova leverage the security and decentralization of Ethereum and provide a builder experience that's intuitive, familiar, and fully EVM compatible. On Arbitrum, both builders and users will experience faster transaction speeds with significantly lower gas fees. With Arbitrum's recent migration to Arbitram Nitro, it's also now 10 times faster than before.

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Starting point is 00:57:04 all with the security of storing users' private keys offline and out of reach from hackers. The Ledger NanoX is the perfect hardware wallet for managing your crypto and NFTs on the go because it connects to your phone with Bluetooth and has a nice big screen for easy transaction readings. Ledger has also upgraded the iconic Ledger NanoS and made the new Ledger NanoS device,

Starting point is 00:57:24 more defy and NFT friender, making it the perfect hardware wallet for beginners. Ledger has truly maximized for both ease of use and security. So discover which Ledger device is best suited for your journey by going and visiting shop. Dotledger.com. Ryan, it is only the second week of October yet we have hit all-time highs in hacks. So not necessarily good news, but so far October is the biggest month ever for hacks. $718 million across 11 different hacks. This year, there's been a little bit more than $3 billion across 125 hacks.

Starting point is 00:57:57 And of course, it's always cross-chain bridges, which has always been the weakest link in this entire industry. It's accounting for 64% of this year's losses. So congratulations October for breaking the record of hacks. And just another quick shill of the Ethereum Layer 2 ecosystem. You eliminate bridges as much as possible in the Layer 2 roadmap. You kill the bridges. And so cross-chain bridges, layer one to layer one. side chains, they're the weak link.

Starting point is 00:58:24 There are the reason why we have all these hacks. Optimism's superstructure, which is, or super chain, which we're going to talk about at some point in the future, ZK syncs like hyperstructure, all of these like single circuit layer twos are the bridged, minimized, scaling ecosystems. And that's why, that's how we're going to eliminate all of these hacks.

Starting point is 00:58:44 So again, that's why we're always bullish on these layer twos. Anyways, congratulations to October for breaking records. Yes, and not bullish on centralized bridge. Not bullish on bridges. This was another hack that happened this week. A defy trading platform called Mango just lost $100 million in a hack. That's included in those October numbers.

Starting point is 00:59:03 And I think the hack here, David, was an Oracle attack of some sort. It was crazy. Oh, my God, it's so crazy. Yeah, okay. So why don't you read this out? So the hacker stole $100 million in this protocol, exploited some kind of like an Oracle attack where you pumped the price and then, you know, through that exploit, ran away with a bunch of money.

Starting point is 00:59:21 and then he said he was sorry and he posted to the governance form Hey guys, please don't prosecute me Why don't you read what this tweet is, David? Yeah, so the hacker who stole a bunch of these Mango tokens posted a governance proposal To the hacker said, hey, I'll pay I will pay back the Dow

Starting point is 00:59:43 The certain like a significant amount of the money Like most of the money 70 or 80% And if the Dow agrees to not pursue legal action. And then, because the hacker owns all of the tokens, the hacker voted yes. To the governance proposal. To the own governance proposal using the funds that he stole. Checkmate, mango holders. Is code law? I don't know. I don't know. But oh my God, this is. I don't think this kind of thing holds up. I don't think this holds up in court. what's the what's the analog i guess maybe you go i have no clue dude there go to wells fargo steal a whole bunch

Starting point is 01:00:24 of their money steal a bunch of their shares and then go to their shareholder meeting and they're like hey uh don't prosecute me and i'll give you most of the money back and then you vote yes yeah like you somehow steal all the certificates and i now own a wells fargo because i own their certificates but you don't own them because you stole them that doesn't yeah yeah only warren buffett could uh has the Wells Fargo shares to pull this off, I guess. I actually think there's a take here. And that is, we've got to get really serious about hacks, okay? So $3 billion this year in hacks.

Starting point is 01:00:58 That's a lot. And years not even over, David. And do you notice when things started to turn ugly in the U.S. from a regulation perspective? We're just talking about tornado cash. It happened after the $625 million Rohnin side chain hacked. Do you remember that? And this was when North Korea allegedly

Starting point is 01:01:16 some attackers from North Korea made off with millions of dollars, and they pushed it through tornado cash. And this is when I feel like the U.S. popped its head up, and the defense apparatus of the U.S. said, uh-uh, we don't like this. This is like, you know, against our national security interests to have these tort-because. Because what's happened is North Korea just got a new business model, and that business models is hacking crypto. So I want to, like, One of my thoughts here, one of my messages to crypto here, the industry, is we think we're playing with these digital NFTs and these experimental defy games. But this is actually moved beyond that. I think crypto has taken center stage in geopolitics, the geopolitical scene. That's what we've entered.

Starting point is 01:02:03 We have nation states that are attacking protocols now. Not this guy from Mango. That was just some guy. But in other cases, the running side chain. Who did the BNB chain hack? We don't know yet. And while I think this is inevitable, and I think it's progress, hacks really matter. I think we no longer get to say, ah, it's going to happen, hacks are going to happen. I think that's true, and I understand that's part of the experiment, but could you imagine a hack that was like 3% or 5% of all ETH supply? And it went in the hands of like a rogue nation state. How is the U.S. national security apparatus going to react to that?

Starting point is 01:02:42 it's going to increase pressure and suppress citizen freedoms as a result of that. So I guess my message here is we as an industry need to get really serious about defense and spend more resources on crypto security and preventing these kind of things moving forward. Right. And again, it's one part, let's write better smart contracts. And it's another part is let's create systems that have less surface area for attack. Yeah, less bridges. Less bridges. Bridges.

Starting point is 01:03:11 Bridges, bad. Speaking of bridges, here's a cross-proticle, a bridge protocol. They just gave an air drop. What's going on here? It's different, though. It's an Oracle bridge that lets you go from a one secure bridge to another secure bridge. And again, like... It's not a multi-sig bridge. It's not a multi-sig bridge. And when optimism and ZKSink have their perfect fraud proofs and they have their circuits down, like the optimism super chain, like the many, many, many trains where there's a thousand layer three chains. There's not a bridge there. There is a single circuit. There is no way. bridge. That is the cool thing about optimism and all these layer 3s and app change on the layer two thesis. The bridges are gone. And so when you use this across, which is this air drop we're about to talk about, and you hop from one bridge to another, you're using a bridge, but you're only vulnerable in that one moment that you are using it, not persistently through all of time. And so anyways, sorry. ACX, across, has an airdrop. So if you've ever used across, perhaps multiple times. There's a different criteria for being eligible for the ACX token,

Starting point is 01:04:12 but a billion tokens has been minted and 125 million tokens will be distributed through an irdrop for the people who have contributed to a cross. I am not local to my wallet at the moment, so I don't know if I got it, but I'm a frequent acrosser, bridge or hopper, whatever you want to call it, not hopper because that's hop, but I'm probably, I think I got this air drop, so I'm going to go home and claim it as soon as I'm done with DevCon. you guys will include a link where you can check that it's a cross dot 2 slash airdrop and you can see if you're eligible for that um david there was a a ruckus on twitter as well that poured out about paypal censorship and um the first tweet i saw about this was from david marcus formerly facebook

Starting point is 01:04:51 now he's working on a bitcoin lightning project uh i believe he used to work at paypal too he's like an executive at paypal and this is as a result of paypal issuing new um terms of service for PayPal users. David Marcus says this. It's hard for me to openly criticize a company I used to love and gave so much to, but PayPal's new terms of service goes against everything I believe in. A private company now gets to decide to take your money if you say something they disagree with. Insanity.

Starting point is 01:05:20 He links to a post that has now been taken down. But the post from PayPal explicitly stated that they plan to target anyone who is sending, posting, publication of any messages, content or materials that, quote, promote disinformation. And how would they do this? The company, PayPal, would just detect $2,500 from your PayPal account if they deemed you were in violation. Okay? So PayPal has since backtracked to this, has called it a mistake.

Starting point is 01:05:55 It's not very, it's not clear how these terms actually came to be and like why they were published, but they are distancing themselves from this, and they are backtracking from it. Here's a headline from Fortune, and PayPal tells users that will find them $2,500 for misinformation, then backtracks immediately. And of course, you know, there is a take here that maybe PayPal genuinely made a mistake. Who knows how this language got in? You know, it's hard to rationalize an explanation for how this could be accidental, but maybe some internal conversation that they never wanted to get out, something like this. I guess the devil's advocate take on that is, well, maybe they were just like floating this

Starting point is 01:06:38 idea and hoping it would go unnotice and there was such a reaction from the entire ecosystem, not just crypto, but outside of it to this, that they decided to withdraw and detract. But the big concern here is obviously imagine a bank, a bank account, like PayPal, digital account. You say something on Twitter. Maybe I don't like the fact that you're suing treasury, David, and I'm PayPal, and it's, you know, against my policy. Or maybe it's, it's, you tweet something and it's quote unquote misinformation. I can then just shut down your account. I can more, I can take money out of your account as a fine. Hey, we don't service people who sue the government. Like, could you imagine? Why not? Right. Like, you just don't really know where this kind of

Starting point is 01:07:25 things ends. What do you think about this? Is this tinfoil hat conspiracy? No, no, not at all. I'm much less gracious than this. And I think that it's actually quite obvious that like, somebody chose that number. That number is specific. Somebody said, you know, you know what? We should do like we should find people $2,500. Like it doesn't, the fact that that number is explicit. It's not that like there's this detail of like PayPal reserves the right to deduct funds from your account if you say something like bad or something maybe or terrorist I don't know but like somebody had to choose $2,500 so somebody wrote that number down and said this is the amount of money that we are going to deduct from your account if under our discretion like this information spreading

Starting point is 01:08:10 whatever yeah and like and the reason why this is so there's that there's that take but also like we know the world of payments is just a huge era of censorship this is what this is what this is what like Amin Soleimani has been doing with like payment channels and it's bank chain. So like MasterCard, Visa, they won't support like sex work, for example. That is censorship. Marijuana industry is the same.

Starting point is 01:08:33 Bankless has been kicked out of a bank accounts, Bank of America. We're kicked out of Bank of America for actually transferring money to Coinbase. Right. And this happens. Yeah. And so we know the payments industry is ripe with censorship.

Starting point is 01:08:46 I don't know like why it's so much, but it's like you can't run like a sex work company or like pot company without getting censored. And so this is part of like the big story of like why we need permissionless payment systems because you don't want to get debanked, de-platformed. Yeah. And I think they are right now advertising crypto for us. And this is why we need to go bankless, of course. By the way, another reason to go bankless is to add insult to injury, David. You know the Celsius hacks. A lot of people with deposits in Celsius loss, a heck of a lot of money, myself included, rip. It seems like.

Starting point is 01:09:21 they also exposed all Celsius users to a data leak. Insane, dude. This came about in, I guess, in the court system, some court documents that were leaked, that basically docked the names because, of course, with Celsius, every account is AMLKYC, so they have the identity, and the amount of money individual Celsius holders actually had.

Starting point is 01:09:44 And there's a way you can kind of back through some of that data and find specific crypto-eathing. addresses, public crypto addresses that these individuals held as well. Nice. Essentially just doxed the entire Celsius user base. As if losing your money isn't enough, now you've lost your entire privacy and everyone knows the net worth that you had on Celsius. Just kicking you in the gut on the way out.

Starting point is 01:10:10 Like absolutely insane, man. Can you believe it? That crypto grifter's video I made where I was like, Alex Monscii is the greatest grifter of all time. I thought, God, that's aging so well right now. The other crazy thing is like, remember last week we talked about the Crypto Lark and how he got Zach XBTed because of, you know, it's like pumping tokens and then dumping them. Crypto Lark withdrew $2.5 million right before it froze. Like, I don't know, right before.

Starting point is 01:10:36 I don't think that's a conspiracy here. Maybe he was just like luck that he withdrew 2.5 before it got frozen. But Crypto Lark, the scammer got out. Jeez, man. It doesn't feel right. But you sell money inside of Celsius, don't you, Ryan? No, it's gone. I don't know where it is. I had money in Celsius, but yes. I actually don't know what the status of my information is, but it's not looking good, David. Rip. Rip on that too. Double rip. So, yeah. I'm right there with you, Bankless Nation. If you got sucked into this. Fortunately, for me, it was just like, I was just kind of testing Celsius and this was play money. Sure. Ish. Yeah. Ish. It wasn't play money for everyone. So that's unfortunate. Yes. And also, sorry.

Starting point is 01:11:20 I would like got doxed, but... Yeah, totally. It's brutal. Board ape creator facing SEC probe over unregistered securities offering. So going after Ugo Labs, SEC, maybe going after probing first. First you probe, you know, then you kind of drop your case. So SEC doing an old probe. And Ugo Labs, of course, the creators of board apes, very prominence.

Starting point is 01:11:43 Is it number one? Number one? Number one. Number one right now. Okay. Number one in market cap. Not culture, in my mind, but that's just my time. What's interesting is, like, one of the line items here is the SEC not only investigating

Starting point is 01:11:59 Ugal Labs or the sale of the digital assets, right, like they have a token, some other things, but the SEC is examining whether certain NFTs from the company are more akin to stocks and should follow the same disclosure rules. The SEC is also examining the distribution of ApeCoin. Here's the thing, David. Like, I don't know what parts of the ape coin ecosystem and all the various parts, like, what parts of those might be securities and what parts might not be. But are they saying that, like, the JPEGs themselves, the ape JPEGs themselves are securities? They are investigating it.

Starting point is 01:12:37 Yeah, the JPEG is a security. Let me just say, like, a probe itself is punishment. It's investigation. I mean, it's legal expenses. It's punishment. It has a chilling effect. on the industry, and here's my beef with the SEC in this type of action is we don't actually know because they refuse to clarify. Our NFTs themselves, the JPEGs, are they securities,

Starting point is 01:12:58 are baseball cards securities, our antique card securities, are pieces of art securities? Of course not. Okay. Do monkey JPEGs really need a 10K filing? All right? Do they need security? My SEC hat is Yuga Labs is building out a metaverse, right? They took investment from like A6 and Z and many other people to build out like this, Yuga Labs, board apes, metaverse. And in that metaverse, a financial asset is a board ape. And so the metaverse has some sort of value to it. And the board ape is correlated or associated with that value. So it's ape coin. And so it kind of actually does feel like a how we test, Ryan. I can't believe I'm taking the side of the SEC. But also it just goes to show that we need better laws because it's a goddamn monkey picture. It's not a security. And we need to have

Starting point is 01:13:47 permissionless building or else where this industry is not going to express itself the way it should. Here's the thing. It's just the SEC. They want to take a leadership position in crypto, but all they're doing is vaguely through these sorts of charges and probes telling us very obscurely what we can't do. But they're not telling us what we can do. Right. They're just suing us. Yeah. Yes. They refuse to give us basic clarity. That's my big charge. And I think that as a result of this, like, so for instance, I mean, it's probably no secret. We'd like to do more with bankless with some sort of membership NFT, right?

Starting point is 01:14:26 What's the status of that thing? How do we make sure that that's, how do we make sure that that's not defund? Like, Gary Gensler's position is if it's a token, it's a security. That's what happens. Dear, boy, do we need another one? You take that one. You take the treasury. I'll take the treasury.

Starting point is 01:14:42 I'll take the treasury. Hey, what about this world where Gensler becomes the next Janet Yellen? Oh, God. That's a world that could happen to. Can I get a poet for suing the treasury? Only if you win. Sorry, dude. You got to win for us, all right?

Starting point is 01:14:58 Anyway, craziness, again, I'm sure there are things that are clearly securities, probably, but we don't know what the bright lines are. And it feels like our regulators aren't willing to actually talk to the crypto community. and give us some clarity here. I just want some good faith, David. On the releases side, L2B, you know L2B, because they're showing you total value locked for different layer 2s.

Starting point is 01:15:25 Now they're also showing you total value locked for bridges. And they're doing risk analysis of bridges, which feels very relevant. So you can look at the Polygon POS bridge, multi-chain, rainbow bridge, Ronan V2 bridge, avalanche bridge, all of the bridges. And you can see how risky

Starting point is 01:15:40 they actually are. So this feels like a very timely release from Layer 2Bet. And you could find that at Layer 2Bet.com. Pretty badass. What's this one, David? Yeah, this is Nethermind making an announcement that they have taken Uniswap, kind of, and ported it over to Starknet.

Starting point is 01:15:57 So remember when we were going through all of the ZK EVM conversations, and I was like, ZK Sync, EVM compatible, scroll and Polygon going after EVM equivalents, and then there's Starknet, which is just like, we don't care about the EVM, we're building our own thing. It's called Cairo. So they have taken uniswap and they have rewritten it, tinkered it a little bit because that's what you have to do, and then applied it to the Starknet ecosystem. So a Uniswap sister thing, which is not exactly what Uniswap is because they

Starting point is 01:16:23 had to change it, is now on Starknet. And they are calling it, what are they calling it, Unistark, because they had to rewrite it for a Starnet. So Uni Stark, which is a Uniswap flavor, is now on Starknet. That's really cool. Obviously get the scalability of Starknet. Do you see this, David? Blockchain address is now available in Google search. So if you just plug in a blockchain address, Google will display it on EtherScan. I like this. Cool.

Starting point is 01:16:52 I also worry about Google data surveillance and typing your... It's just pulling from EtherScan. It's not any more invasive than EtherScan. It's all public. Sure. Sure. I guess this is true. Here's what I worry about, David.

Starting point is 01:17:05 You start plugging in all of your eth addresses. for example in Google, Google already has a profile for David Hoffman, where it knows your search history, it knows like your browser history, it knows a lot of data about you. Yeah, but it knows maybe where you are in Google Maps. You're also complaining about the business model of Zapper and Xerion. I don't, I'm pushing me back on this. I'm complaining. I'm only complaining because it's Google and like Zaporan do not have the scope of a data profile on me that a Google has. And so I just worry about these kind of long-term effects. I'm happy that Google added this. I just, again, it's, it's kind of like a, how do we get out of this like

Starting point is 01:17:43 moloch trap of constant surveillance, tech surveillance of us? And that's the part that always gives me pause. But anyway, in the meanwhile, good job. David, you released a new bankless video here. What's this? Yeah, so this is that new bankless YouTube account. There's new YouTube, new YouTube video. It's like these hyper-optimized 15-minute explanation of what ether is. It's basically my triple point asset thesis. But if you are into these new videos, go check it out. All right, Uniswap Labs is announcing a $165 million raise in Series B funding to bring powerful simplicity of Uniswap to even more people. So congrats on Uniswap Labs, they are raising, and I believe that is the only raise of the week. However, Ryan, I can see on the ground at DevCon

Starting point is 01:18:24 that definitely there is some deals being made. There are deals being inked on the floor at DevCon. So there are some activity. It's definitely the biggest raise of the week. I bet there are others that we miss. But one thing that's happening, we know, is Uniswap as a result of this funding Uniswop Labs is hiring. The reason we know that is because they're on the jobs board. It's our weekly reminder to tell you to get a job in crypto. David dances. I'm going to read some jobs off for you. Uniswap Labs needs a director of product management. David, I think that's non-technical. Okay. They also need a developer relations lead. Probably not technical. Probably-ish. Senior front-end engineer at Uniswop, senior back-end engineer. Those are definitely technical.

Starting point is 01:19:02 Solid World Dow needs a senior Web3 developer, Rubicon, smart contract engineer, bankless, still looking for a social lord, optimism hiring a bunch. So it was rabbit holes, so is coin shift. Go head on over to bankless.palat.com slash jobs and sign up. So you get these in your inbox, get a job in crypto. Now's the time. Guys, we got a lot more coming up, including some hot takes from crypto Twitter. David, you've got some takes in the Coinbase documentary. I haven't watched it yet, but you have. We'll talk about that and more when we come back. But before we do, we want to thank the sponsors that made this episode possible. The Layer 2 era is upon us. Ethereum's layer two ecosystem is growing every day, and we need layer two bridges to be fast and efficient in order to live a layer two life.

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Starting point is 01:20:15 layer two transferring needs. So go to across.t.com to quickly and securely bridge your assets between Ethereum, Optimism, Polygon, Arbitrum, or Boba networks. Nexo is your financial hub for all your crypto needs. Nexo lets you buy crypto instantly with your credit or debit card or via bank transfer, and they also have an awesome advanced trading platform, Nexo Pro, where you can get the best possible prices and trade with 50% discount on fees. And NXO also lets you earn interest on your crypto in Bitcoin, ETH, or other assets. And they also give you an instant crypto line of credit with as low as 0% APR. And they also give you access to a crypto-backed MasterCard, of course earning you more

Starting point is 01:20:54 crypto when you use it. So, enhance your financial life with NXO, who ensures all credit lines are over-collateralized with insurance on all custodial assets. Nexo, the right place for your crypto. So click the link in the show. show notes to join over 5 million users who are getting the most out of their crypto. Guys, we're back with takes. Hit first take, David, you watch the coin documentary.

Starting point is 01:21:14 It's called Coin, a Founder's Story. What's your review? How many stars? Five. Five out of five stars. I thought it was super, super good. And there's also so many more movies about Ethereum, about crypto coming out, like documentaries.

Starting point is 01:21:26 And I think it's going to be a really actually great onboarding and PR tool for crypto. Movies. Just like, yeah, let's tell you the story, the long-term story. Real humans. Real humans. Not just the shadowy supercators. Yeah. And Brian,

Starting point is 01:21:37 Brian and Coinbase has always kind of been like a black box. It's a little about, hey, what's going on over there? Like, what's you guys up to? Like, not for any particular reason. Brian's just kind of an introverted person. And every time I learn more about Brian, either through his interview with Peter McCormick and then our podcast with him, he doesn't do very many public things.

Starting point is 01:21:55 So this documentary was awesome just to see just the story of Brian and Coinbase. And I tweeted out, every time I learn more about Brian, I discover more reasons to respect him. And so he's just a guy that saw, he first Coinbase was a wallet. And he was like struggling to find like a business model because no one had any Bitcoin. So it's like, oh, I'll just put in a buy button in the wallet. And I'll let people buy Bitcoin so they can use my wallet. And then he turns, learns that like actually that's the business is selling Bitcoin to people that want to buy it.

Starting point is 01:22:25 And then the ball starts rolling downhill. And Coinbase just becomes huge. And him and Fred Erick from started building this thing. And so like as I've learned about Brian, he's gone from. from like, for me, just a successful founder to an industry leader to like a straight-up personal hero. Like that guy has like done so much for the industry. And I don't think we give him enough credit. But that's my take of the week. The coin, the coin movie was great and Brian's a great guy. That's awesome. I think David, like the crypto banks, we're going to have some banks that

Starting point is 01:22:55 like stand up and uphold crypto values for us. I'm hopeful Brian Coinbase is among those. I think there will be sadly some other crypto banks that kind of sell us. out to the regulators and politicians and are not going to be fans of defy. And those will emerge too. But I think Brian's always been here for the right reasons. And yeah, we're excited about that. David, this is a take from a congressman, Representative Bill Huzenegah. Yeah. And Bill says, the fact that Gary Gensler has appeared twice with John Stewart before attending an oversight hearing with the financial crimes and enforcement and also the Democrats, just like, you know, doing his job, is alarming.

Starting point is 01:23:34 Appearing before Congress is part of your job, he says to Gary Gensler. We look forward to seeing you in 2023 under new leadership. So a congressman, a House of Representatives congressman, is saying, Gary Gensler, stop going on John Stewart and start showing up at your job. Stop trying to be an influencer. Stop trying to be an influencer. Yeah. God. Ryan Sean Adams, here's a take from Ryan saying,

Starting point is 01:23:54 apparently the era of easy money is over, and crypto was just a speculative acid bubble that will never recover, and there was never real, anything real here to begin with, and you should have sold the top, you idiot. And then he finished his saying, hello 2018, good to be back. What do you mean? Good to be back.

Starting point is 01:24:08 And why did you call me an idiot? By the way, thanks for the handling the tone of that. It was just definitely sarcastic. It just feels very 2018 to me. Like at a time where everyone's saying crypto is over, it was always speculative asset. There was never anything real. Go to Reddit and try to say something positive about NFTs right now.

Starting point is 01:24:25 You just get absolutely brigaded. And this reminds me so much of 2018, honestly, where we had kind of the backlash in the back of ICOs. And Ethereum was like nothing. And there was no such thing as defy. And all ICOs and all of crypto was a scam feels like 2018. Now, I know there are some differences. We've got war in Ukraine. We have like massive macro economic pressures and things we didn't have in 2018.

Starting point is 01:24:50 But that's what everyone says. In 2018, people are like, no, this is different than the 2015 bear. because like in this bear X, Y, Z, right? And like, everyone always says that. Anyway, to me, it's kind of home. It's back to 2018. It'll take some time to recover, but I'm super confident we're going to come back

Starting point is 01:25:09 stronger. It just might take a little bit. David, what are you excited about this week, man? And why is it DevCon? Oh my God. Defcon has just been so fun, man. And this was a picture of me at Rave last night. Avay's like, you know, regular party that they always throw. And this

Starting point is 01:25:25 is Dankrad. So, Dankrad Feist, this guy, super German always wears a collar in the middle of this, in the middle of this raid. Hey, you said there were no suits. He's got the sports coat on. It's different. It's different when it's Dancrad. Dengrad doesn't count. He's just German. So I took this photo of Dengrad at Rave last night. Yeah, I mean, like it's just, it's so great to see all the builders around. This is like a big brain researcher behind Proto Dengarde by the way. This guy's like, nose crazy polynomial math. And there's like, like, race. lasers in the background. Crypto is great, man. Yeah. And it's like the energy here is so awesome. And like even though it's the bear market and people are sad about the prices and my metaphor for these markets is like in the bull market, it's like a bonfire.

Starting point is 01:26:11 But in the bear market, like the fire starts to dwindle. But the fire at DevCon is really strong. And like the boys club event also last night was just the energy at boys club was crazy. And it's cool because boys club is like, I don't really think like boys club and like, core layer one Ethereum protocol development. Like that's kind of like they don't really mess. Boys Club, by the way, is a, it's a Web 3 Dow that it's a social organization. Yeah.

Starting point is 01:26:40 For primarily like representing women and, you know, non-binary people. So when people hear David say boys club, it's not like, it's like, it's a joke. It's a play out of words. It's not an actual voice club for boys. Yeah. Yeah. But like the boys club showed up and through like one of the most high, like high energy vitality events and everyone is having a really good time.

Starting point is 01:27:00 And so as like energy is going out of the space, and it's just a good move by Boys Club because they throw, that's what they do. They throw really good events. Parties? Really good parties. And there's not many like other conferences out there that have like enough life in them for them to throw a good event because like no one wants to throw a depressing event. So what do they do?

Starting point is 01:27:19 Oh, they go to like the crypto nerds at the developers convention and then they throw a really good event there because that's where all the vitality is in this industry. Because developers aren't going to throw their... They're going to buy boxes of pizza. Right. Yeah. And like the cool thing about DevCon and why I'm so excited about DevCon is it's a tech conference.

Starting point is 01:27:37 But it goes to very specific cities. It goes... It's not San Francisco. It doesn't go to New York. It goes to... Off the beaten path. Bogota. It goes to Osaka.

Starting point is 01:27:46 It goes to Prague. And it's not just a tech conference. It's also a cultural conference. And that's because Ethereum's not just a technology. It's a social organizational technology. It's a movement. And so it's so, and this is why the DevCon execution team is, like, so shout out to Skyler at the EF. They got a lot of pressure, by the way, for going to Columbia because, you know, people are saying, hey, it's too dangerous.

Starting point is 01:28:08 Like, you can't throw conference there. So, like, you can't throw conference there. It's like, people do have, like, bodyguards and stuff. But, like, it's also, like, if you just live with common sense, like, you don't get yourself in trouble. I haven't heard anyone getting into trouble. But, like, leaning into the culture side of things for every city that we go to. And it's just, like, the right branding for Ethereum. What's the next city, David? TPD.

Starting point is 01:28:28 People are like, this is where people like start to lobby the EFs. Like, I want to come to my city. So there's like a movement to get people to get the EFCon in Turkey in Istanbul. I think it's going to be somewhere you don't suspect, right? Oh, definitely. Definitely. Istanbul would be one of the top places I would not suspect actually. Yeah.

Starting point is 01:28:47 Right. Anyway, lots of places. That's what I'm bullish on. The fact that DevCon is not just a tech conference. It's also a cultural conference. And I mean, it's important. This is where we come together as a community and hang out and make sure that we're not just like face down buried in code all the time or in our world podcasts. That's awesome.

Starting point is 01:29:04 What are you bullish on, Ron? I asked a question this week on Twitter. Sometimes you get good answers, questions on Twitter. Sometimes you get bad. I got a lot of good ones. I said this. From the 2015 to 2016 bear market, we got Ethereum. From the 2018 to 2019 bear market, we got defy and NFTs.

Starting point is 01:29:20 What's going to be the big thing coming out of this bear market, the bear market of 2022 that we're in? And I was just really excited about the range of different answers to the question, because it wasn't just a consistent, like, there wasn't like a group think of it. It's all going to be this or it's all going to be that. Impact Dow's, Defy Science, ReFi, Web 2, integrating Web 3, GameFi, broadening of the NFTs to research IP and NFTs like music, video and other verticals, more nube-friendly, Defi, social crypto, all of these answers, the question. My answer to this question is probably the layup answer, which is like layer twos.

Starting point is 01:29:59 It seems so obvious that coming out of this bear market, layer twos are going to be like the absolute vanguard of crypto. Like they're going to be stronger. They're going to be in higher use. I don't know, David, if you saw the Ethereum quarterly report, you know, state of Ethereum report, like earnings report we released on bank lists last week, Ben put this together for our team. Ethereum's down in just about every category, right? Like revenue is down 86%.

Starting point is 01:30:28 You know, defy total act values down 60%. Stable coin supply down 21%. Like it's very clear that we are weathering a major contraction. But the bright spot was layer twos are up 97%. About 100%. We're doing that in a bare market. So this to me is like these are kind of the early saplings. they're kind of on the tree of, you know, future life and future progress. So that's what I'm

Starting point is 01:30:57 excited about, that no one actually knows what the next big thing is going to be tells me that it could be almost anything and it'll be unexpected and that we're pursuing so many different use cases at the same time. And then I just see obvious things like layer twos, which are going to be a big deal. 100%. 100%. Also bullish. All right, man. I know you've got to get somewhere real soon for DevCon. But let's get to the meme of the week. What are we looking at here? Yeah, this is, I can't remember what kind of flavor of comic this is,

Starting point is 01:31:25 but it's like the guy who's interviewing for a job, and the job interviewer is asking, can you stop inflation without causing a recession? And the interviewer says, no, I can't. And then the guy says, okay, you're hired. And then it turns out that this is the Federal Reserve. Sinai didn't happen, so that's what this is. Yeah, that was pretty good.

Starting point is 01:31:44 I'm very emblematic. All right, guys, David's got to get to DevCon. I know he's going to be on stage, presenting a few things. Actually talking, I think, doing a panel coming up soon. I am moderating a panel that is definitely stretching my technical ability. It's account construction, so I have to finish up doing my research. But it is also the only panel that Vitalik Buterin is on on the main stage. So your boy's hosting that panel in a second.

Starting point is 01:32:04 He chose to do account abstraction. That's this thing that he wants to talk about, huh? Yeah. That shows how important he thinks it is. Well, cool. We'll leave it at this. Then, RIS and Disclaimers, as always, got to tell you that crypto is risky. definitely on the frontier. Eth is risky. DFI is risky. You could definitely lose what you put in,

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