Bankless - ROLLUP: Memestock Mania | ETH Spot ETF Countdown | $25M Hackers Charged | Crypto's Election Impact

Episode Date: May 17, 2024

The Bankless Friday Weekly Rollup Third Week of May ------ 📣 TRANSPORTER - SECURED BY CHAINLINK CCIP | TRY IT OUT https://www.transporter.io/  ------ 🎙️ SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium  ------ BANKLESS SPONSOR TOOLS:   🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE https://k.xyz/bankless-pod-q2  ⁠    🔗CELO | CEL2 COMING SOON https://bankless.cc/Celo    🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle    🗣️TOKU | CRYPTO EMPLOYMENT SOLUTION https://bankless.cc/toku    ⚖️ARBITRUM | SCALING ETHEREUM ⁠https://bankless.cc/Arbitrum    🌐 CARTESI | APPLY FOR A GRANT https://bankless.cc/CartesiGovernance    ------ TIMESTAMPS & RESOURCES 00:00:00 Start 00:01:58 Markets https://pro.kraken.com/app/trade/btc-usd  https://pro.kraken.com/app/trade/eth-usd  https://pro.kraken.com/app/trade/eth-btc    00:06:07 Inflation Numbers https://www.nytimes.com/live/2024/05/15/business/cpi-inflation-fed    00:07:07 Gamestop and Memestock Mania https://x.com/TheRoaringKitty/status/1789807772542067105  https://imgur.com/PhBgZL2 https://twitter.com/vladtenev/status/1790560257196060741    00:11:12 Institutions Buying Bitcoin https://twitter.com/BitcoinMagazine/status/1789020004131737624  https://twitter.com/RyanSAdams/status/1789024343038586956  https://twitter.com/EricBalchunas/status/1790391049560498410    00:13:36 ETH ETF Approval Deadline https://twitter.com/vivekventures/status/1789161576987054271  https://x.com/RyanSAdams/status/1790856567979454711  https://twitter.com/RyanSAdams/status/1790825287229276526  https://twitter.com/SGJohnsson/status/1788973146478948614    00:20:46 Tornado Cash Devs Arrested https://twitter.com/valkenburgh/status/1790367445720445421  https://twitter.com/L0laL33tz/status/1790385855556698448  https://twitter.com/LynAldenContact/status/1790391222235758700  https://twitter.com/JDonoghueAuthor/status/1790485643950280894  https://twitter.com/RyanSAdams/status/1790450619074871527    00:25:04 SAB 121 Repealed! https://x.com/BanklessHQ/status/1791140496397468064  https://x.com/RyanSAdams/status/1791147869791002699    00:28:07 Crypto Gets Partisan https://www.politico.com/news/2024/05/10/trump-crypto-biden-00157051  https://twitter.com/mcuban/status/1789037772050702824?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g  https://twitter.com/arkhamintel/status/1790014778519265463  https://twitter.com/wileynickel/status/1788608778843074658?s=46  https://twitter.com/samlyman33/status/1788612636428374183    00:36:39 $25M MEV Exploiters Charged https://www.justice.gov/opa/pr/two-brothers-arrested-attacking-ethereum-blockchain-and-stealing-25m-cryptocurrency  https://twitter.com/tmnxeq/status/1790778875816898602    00:43:42 Is Code Law? https://x.com/TrustlessState/status/1791128506614608014  https://twitter.com/MohamedFFouda/status/1790812568526704849    00:46:59 Lens Network https://twitter.com/LensProtocol/status/1790458242855751950    00:48:23 Permissionless https://bankless.cc/PermissionlessDiscount    00:49:01 Airdrop Meta Shifting https://twitter.com/PrimordialAA/status/1790033102837797069    00:51:14 Future of DAI https://x.com/RuneKek/status/1790777230341062660    00:56:59 WUTANG https://x.com/msantoriESQ/status/1788944762608754731    00:57:48 Kraken Push to Dismiss SEC https://x.com/ShaneMac/status/1747262469490536594    00:58:36 Polymarket raises $70M https://polymarket.com/event/nic-carter-vs-david-hoffman-Fight?tid=1715869550851    01:00:44 David vs Nic https://x.com/KarateCombat/status/1791077245194272830    01:03:05 Meme of The Week https://x.com/RyanSAdams/status/1790819671534411936    ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures⁠ 

Bankless Nation, it is the third week of May, the crime and politics edition of the weekly roll-up, if I might say so, David. It's been the entire year. Crime and politics. God, when are we going to get out of this, huh? Yeah, crime politics and meme coins. It's exactly what we love. Yeah, some sad news to start, though, on the week, which is tornado cash developer Alexei Pertseth. It was actually sentenced this week, five years in jail. And we've got to talk about that, David. Yeah, in the Netherlands.

What does that mean for crypto? What does that mean for privacy? what does that mean for the Roman storm case, all of that? Back on the United States soil. You know how we always say front run the opportunity in crypto? Well, the Department of Justice said, well, not like that, as they charge two brothers for an MEV bot attack. Is code law or not really? We'll unpack that and more.

Big win in the Senate as well. What happened with this? Oh, man, there was a vote for pro-crypto legislation. This is a continuation of something we talked about last week. It's called Stab 121. If you don't remember what that is, we'll do a real. recap, but the big question is, is Biden going to veto this now? And David, I think crypto just got a lot more partisan. We also have the ETH spot ETF, the approval or denial decision next week.

And I kind of wonder how all of the politics is involved or wrapped up in that decision as well. Yeah, mainly what happens next. And then lastly, time is a flat circle. GameStop short sellers get crushed for a second time. How did it happen twice? All this stuff and more. But first, a message from our friends and sponsors over at Transporter, a brand new bridging app to help you bridge all of your assets across optimism, Ethereum, Arbitron, Base, or Avalanche. Transporter is built using Chain Links CCIP in the background to help you transport your assets from chain to chain to chain. Of course, very low fees. You can try it out at Transporter.i. Or click the link in the show notes so you can just send it across chains.

I like that. Cross chains with confidence. It's a good slogan there too. All right. Let's talk about the markets, what confidence level does the market have on Bitcoin this week, David? Bitcoin, 5% more confident this week, started the week at 61,800, ending the week at 65,150. That's good week. Yeah, 5% more confident. It's decently more confident. If we could get a few of those, more and more, that would be great. Yeah, nice week for Bitcoin. And how about the ETH price on the week? Less confident, 2% less confident. Started the week at $3,000 here now down to $2,940. And then if you just look at the ratio, Ryan, I was wondering if you were going to, you were going to skip it this week.

If I was going to have to force you to do it. But yeah. The ratio is down a solid 25% in the last 80 days. We are down to 0.045. That is the lowest has been in three years. Yeah, the ETH Bitcoin ratio. This is the lowest it's been in three years. Yeah.

Even lower than when Three Ours Capital got liquidated and they had to dump all of their ETH collateral to save their positions, which I'll ultimately did nothing. I actually have a take about like why ETH is so weak and specifically why Bitcoin and meme coins are so strong relatively in this market. You ready for it? Yeah. Tell me you tell me why this is a painful chart. I'll tell you exactly why this is happening. This is just my take. Bitcoin and meme coins are strong and in contrast, ETH is weak. Why is it happening? Well, the answer with Bitcoin is very obvious. It had the Bitcoin ETF approval. It has gotten the regulatory stamp of approval by the powers that be. It is now accepted in banks. It is now being

bought by banks. We're going to talk about that in a second. And overall, it doesn't have a fight with regulators. It doesn't have a fight with the nation state. It's not offending the nation state. Mem coins also similarly are not fighting like in regulatory circles. Like the meme coins being not a security or not even close to being a security are free to be like minted and distributed and everyone can go have fun with meme coins, no consequences, no fighting with any sort of like powers that be whatsoever. Ethereum, on the other hand, is like going toe to toe with regulators. We have tornado cash developer in jail. We have the ether at risk of being called a security by Gary Gensler. We have the Department of Justice going after the MEV supply chain. Privacy is now banned and also

privacy is trying to be developed by the Ethereum ecosystem. And so because like, ETH is like doing it the most to offend the nation state. It is being weak this cycle because like people are scared. The market is scared because like the power, the ETF approval is not going to happen. And so I think the depression of the ETH price is like a result of like Ethereum trying to go toe to toe with some of the big things that nation states like to have monopolies over. So you're saying ether is getting whacked by regulators this cycle, whereas Bitcoin is basically being embraced by. institutions and regulators and meme coins are just like you know they're just from the perspective of nation states they're just mean coins are just irrelevant yeah i it's interesting

it's an interesting narrative i one response i i would say to that is okay explain soul so uh salana does not have an etf and it has been like the market is not considering the the price of soul in the relation to the etf yeah and i mean so why has that outperformed would be you a part of a rebuttal. I actually have like a deeper take about, sorry, not a deeper take. Let me rephrase that because, you know, your take was good, David. I don't want to put down your take here. But like, I think my general take, and I want to talk to you about this and maybe a bankless take sometime, we'll save the rest of this content. But Ethereum is really just going through its growing pains because of migrating all of its execution to layer twos.

And that's what this cycle is. And I think that's the big driver more than regulatory. But I will I think I think regulatory is a portion of this. Overall, though, total crypto market cap 2.5 trillion, almost just below. And so still pretty healthy in the total crypto market cap. Still looking for that rampaging bull market. We just haven't had any of that. But meanwhile, we'll talk about some inflation numbers instead while we wait. Yeah, so inflation has cooled a little bit on the week. So we got the April numbers in prices climb 3.4%, a bit lower than people expected. Also, low. than March, which was 3.5%, the lowest annual increase in core inflation since 2021. So, David, the market's like that because when inflation goes down, you know, Powell gets happier, apparently, and, you know, like the easy money, the probability of him reducing rates at some point in the future increases and the easy money train like continues. You know, this is in contrast to the Lynn Alden episode we put out earlier this week,

which is kind of making the case that what Powell does doesn't matter as much. It still matters, but doesn't matter as much because we're in a fiscally dominated world. But, you know, for the time being, the markets react to this. Low inflation is good for risk on assets. Speaking of risk on assets, Ryan, were you paying attention to the trad stock market this week? Did you hear about this news? I was paying a little bit of attention to it. Like, I know something with meme stocks, maybe they're back.

And we've got this tweet that you put in the agenda. I'm kind of confused why this is relevant. Somebody, Roaring Kitty, my looking at is a picture of a person sort of like, you know, flash animation style, like just sitting up in their chair and their desk chair. Yeah, so the, well, the meme is being tweeted out by Roaring Kitty. And it's a man who's like leaning forward in his desk chair. He's like, okay, I'm paying attention now. Oh, I see.

But Roaring Kitty is an account, a Twitter account that went dormant in 2021. This is the Roaring Kitty. 1.2 million followers? Yeah. It's a big town. This is the Roaring Kitty. kiddie who led the short squeeze on GME back in 2021 that started the whole meme stonk revolution. Do we know who this person is?

Yeah, this is the guy with a bandana who like did some streaming about like the GMA. That's this guy. And he hasn't tweeted in like three years or something. He's the guy who testified in Congress. This is the guy who's just like Congress. I swear I just like the stock. This is this is the guy who like led the GME short squeeze. Okay.

And so like cause the whole like 2021 like shorts like ston. So this implies he's now paying attention. Yes, but also hasn't tweeted in three years. And so this is his first tweet in three years. And he's like, it's like, okay, now I'm paying attention. As a result of this tweet, the GME stock price pumped from $10 to $65. Shut up. Liquidated $838 million of GME short interest, which is the exact same thing that happened three years ago in 2021.

We just did it all over again. Go look at the chart. Do you have the chart? This is the chart? This is the chart. Okay, so these are monthly candles. So that big chart is the chart of 2021. That big ass, excuse me, a green candle that liquidated all the short hedge funds in 2021

and caused the whole Robin Hood thing, caused all of that. And then that last green candle that you see is the thing that just happened this last week, which is just like a smaller version of the same thing that already happened. Okay. I mean, but we've been since that GME. I haven't looked at these charts. almost up like we've been on a steady trajectory downward right and this is just like well yeah because like game stop is not worth like the market cap that it was giving it it was

just an anomaly because so much short interest was on game stop so before the initial short squeeze in 2021 game stop was trading at three dollars it then went up to 120 dollars it fell down to 10 dollars where it started its second short squeeze last week 10 dollars to 68 dollars so it's still up from it's like initial um initial short squeeze robin hood uh printed five billion dollars in equity trading volume yesterday because again all of the game stop short squeezers are on Robin Hood and so Vlad the CEO of Robin Hood says one of the biggest days in last 12 months. So is this, what does this mean? What's the interpretation here? Are our meme stocks back? Are we going to have another meme stock cycle? I don't know. I don't know what the impact

is. Like we've already experienced this in the markets once and I don't know if it's like do the AMC thing all over again? I don't know. But the fact that this happened twice is pretty hilarious. Can I just be like, I feel like meme stocks, again, I'm not a meme trader, so this is like could be a totally just like old man take or whatever. But like I feel like they're kind of boring compared to meme coins. Like why do a meme stock when you can, with cash flows, when you can do a complete meme coin

that basically just like, like has that, has the GME community discovered meme coins yet? Do you think that crypto has sucked some of that meme like animal spirit out of the oxygen out of the room? Well, the thing is with meme coins, there's like a much smaller circle of people who trade meme coins than the GME like army of people. It doesn't have to be though. It's so easy. It's so easy. Well, yeah, but the meme coin market caps just can't fit very many people, whereas the game stock market cap can fit like an entire subreddit of people. Okay. Well, yeah, I guess we'll have to monitor to see if that lasts or if it's just a week. type thing but you know it's something that's long lasting i think david is institutions buying the bitcoin spot et f so whole bunch of uh things were disclosed this week with with SEC filings

apparently a whole bunch of the banks actually have some bitcoin ETF on their balance sheet though this was um and uh filing from jp morgan they actually own some bitcoin david you know almost a million dollars worth of the bitcoin spot etif which is kind of funny because jamie diamond and it publicly seems to hate it. I don't know if they're like, you know, stacking to hold Michael Saylor style or if this is some like administrative technicality. But the fact of the matter is J.P. Morgan holds Bitcoin. So does Wells Fargo, by the way, which is kind of interesting.

And also, there are five big Canadian banks because like the Canadian banking system is all consolidated. The Canadian banks big? Fundamentally. They're big for Canada, okay? They're big for Canada. And so all of them. It was disclosed last week. actually own Bitcoin, like five out of five. Canadian big banks own Bitcoin. So some of the banks

are getting in on this. And that's interesting. And also, it's not just banks. It is states. All right. The state of Wisconsin. State of Wisconsin. Let's go. Let's go Wisconsin. They bought out Wisconsin listeners. A hundred million dollars worth of the Black Rock I shares Bitcoin ETF. This is Eric Balchunis. He goes, wow, a state pension bought I in the first quarter. Normally, you don't get these big fish institutions for a year or so when the ETF gets more liquidity. But as we've seen, these are no ordinary launches. A good sign, expect more as institutions tend to move in Hertz. Okay, so that's one state. We got another 49 to go, all right? So Wisconsin being charged. What's the micro strategy state of pension? Can we get one of our

states to just become like the Bitcoin buyer? How do you think that happens? You think the state of Wisconsin Wisconsin Investment For whatever's on the state of Wisconsin investment board is just a big bitcorner. Yeah. You think they listen to the bankers? Shout out whoever that person is. They're probably onto the Bitcoin podcast,

not so much bank list, but maybe they listen as well. Well, shout out you. You're a hero, state of Wisconsin employee. Thank you. When we finally get the ETH ETFs, maybe we'll have a war of this date as to whether they decide that they're going to be bitcoiners or Ethereum's

which ETH they're going to buy. I mean, speaking of that, the date is coming up next week. So we're going to be talking about it on next week's roll up. That is the Ethereum ETF approval needs to be either approved or denied by May 23rd. And let me, I want to ask you what you think is going to happen, David, before I give my take, but like let's talk about, let's recalibrate on the backdrop here. ETH sentiment is kind of bad right now. We just talked about the ratio. Okay. ETF approval, basically no one thinks is going to be approved.

Prediction markets are basically like zero to 25 percent. The Bloomberg, you know, fellas who stay really up to speed, they're like, hey, there's no chance. We just had the SEC suing everybody, including consensus. And we had that Joe Lubin episode where he's basically, yeah, it's not going to happen. They're out to get Ethereum. So it seems like our chances are dim. But what say you? What do you think about approval odds? Below 10%. That's not zero. That's not zero percent. It's not zero. It's not zero. And what do you base that on? I think the market has priced in below 10%.

I think that's what the market is pricing in below 10%. That's why ETH is just like not going anywhere. Yeah, like, if you were like, why would you hold ETH? Like Bitcoin is the one with the ETF and Salon is the one with all the meme coins and that continues to be like the state of things. I think that's the base case. Let me give you two tail outcomes that could happen. Okay?

The tail, tail, I guess positive and a tail negative. All right? So the tail event on the good side would be approval. All right. And this is not very likely to happen. I definitely give it under like 5% odds. But there is a chance here, David. And here's what I think it is.

If, and this is a big if, Biden and the Democrats wake up, it's 11th hour, they realize that their party is getting painted as the anti-crypto party. And this becomes a November. Which wins them zero votes. Wins them zero votes. They only lose votes. They only lose money. And Trump, you know,

in and tries to make this a wet wedge issue. If they want to counteract that, they might actually put some political pressure on the SEC and Gensler to just throw a bone to crypto, just to prove the ETF. Okay? Just like call off Gensler. Hey, you can let this one slide. If you don't, it'll hurt us come November is not worth, you know, losing a White House over. That's a possibility here. And we'll talk more about the politics of this in the next section. But can you see that as a faint possibility, maybe some opium. Hopium for sure. Yeah, pass whatever you're smoking.

Well, I'm not smoking. I'm just throwing a hypothetical. Okay, so here's the other hypothetical, though. This would be tail risk on the bad side. Imagine instead of approving, okay, Gensler comes out next week and they declare Etha security. This is not that far-fetched, actually, because there's evidence. This is Eric Balchunis, and they dug up some papers.

Like, if you go into all of the, you know, like 50 feet deep pile of legalese, there's actually maybe some commentary that shows that the SEC in Eric's words is perhaps considering that ETH is a security as part of their denial. So they might say no ETH ETH, by the way, it's a security. And also as a security. Yep. Which this outcome seems just more likely. Oh, really?

I can simulate this outcome in my head. So that's another tail risk that or a tail event that could happen. right so we got on both sides i guess we have to see next week but i think that's also meaningfully priced in maybe not the eth is like formally a security i don't know if that's completely priced in oh just like the bad sentiment is dude but like don't you think if gensler says eth is a security we're headed for a big eth price drop yeah whether it'll be sustained or not i don't know but yeah it's obviously not bullish that's for sure that's not bullish it's not bullish but just like it's bad sentiment has just like completely there are fewer and fewer

for Eath sellers left. And so like, yeah. Will I sell Ease because Gary Gensler calls it a security? Like, no. And like there's a higher proportion of people me left in the market because, you know, the weak hands have sold. And like the believers are still holding. And that's where the price equilibrium has been discovered.

That's right. Buy more, David. That's what I'll do. That's right. Yeah. You know what? That's, Ease's security. That's bullish.

Bullish. What are we got coming up? Coming up next, tornado cash developer Alexi Pertsiff convicted. What were the arguments and does it set a precedent for court cases in the United States? We're going to cover that. Pro-Crypto legislation just got passed in Congress. Last week, Biden said he would veto it. Now the time is coming to actually see if he's going to follow through on that.

And then lastly, the Department of Justice charged two brothers with the exploit of an MEV bot. What happened? How does the government perceive MEV? And overall, this is another day of Code is Law versus Law is Law in crypto. All of this and more. But first, a moment to talk about some of these fantastic sponsors. Then make the show possible, especially Cracken, our preferred crypto exchange in 2024. If you do not have an account with Cracken, consider clicking the links in the show notes.

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And get your journey started in one of the largest Ethereum communities. Sad news for crypto this week, the tornado cash developer, Alexei Pritzv, was convicted on money laundering charges. This is one of the two tornado cash developers who got arrested. This court case happened in the Netherlands, and a three-judge panel, Dutch panel, sentenced him to 64 months in prisons. That's over five years. One of the judges said this in the proceedings. Tornado cash in its nature and functioning is a tool intended for criminals. Ooh, a hot take.

A tool intended for criminals. So we've got 14 days to appeal the decision, so it's not completely done. Of course, bankless listeners will note, tornado cash is what, Dave? but it's a on-chain mixer, smart contracts, primarily. It's still in operation, right? It's immutable code. And Alexi deployed this along with Roman Storm and, like maybe some others, to Ethereum. This is immutable, it's autonomous, it's open source, was used by...

North Korea and me. I also used tornado cash. Yeah. No longer. Yeah. No longer, ever since it's been OFAC sanctioned, of course. course, but this is a well-known privacy tool. So Peter Van Valkenberg from Coin Center had some response because the big question is, will this carry forward into the U.S.? We've got Roman Storm's

case, which is not happening in the Netherlands. It's happening in the U.S. And that's definitely one to watch. He says that the standard for culpability in the Netherlands is different, maybe much different than the United States. And so that means because Alexi didn't try to stop North Korea, I'm unclear what he would even do to stop North Korea in the case of a mutable smart smart contract, but the judges decided he was negligent. He didn't do that. And the standard for criminality in the U.S. is much more specific. You actually have to have an intent for crime, and the prosecution must prove that the defendant intended to launder money,

not merely know that it is possible for some bad actor to do this. Right. So, yeah, the difference between the precedent and the Netherlands is that the defendant, that Peter says, mere knowledge of a significant chance that one's actions could facilitate crime is what made Alexei Persev guilty in the Netherlands. This is not the precedent that we think and a hope we have in the United States, whereas, like, you actually have to take an action, you have to actually be an agent in the facilitating of money laundering or like aid other people who are also doing it, which is not what Alexi did. The fact that Alexi knew,

that the tool that he was developing could be theoretically used for a crime was apparently enough to rule a guilty verdict in the Netherlands. Which, by the way, I think is asked backwards. It's a crazy standard because how do you go with this, right? It's like, how about Ethereum validators? I mean, do they have knowledge that bad actors could use Ethereum? How about, like, any messaging platform you can use to facilitate, like, criminals can use to coordinate and communicate their intent to communicate a crime?

Yeah, go all the way down to the internet. How about TCPIP? I mean, like, North Korea was using that as well. If you develop a hammer, like, a criminal could, like, use that to kill someone. It seems like an incredibly unjust interpretation of the law, even if that is the law in the Netherlands. This is an independent journalist commenting on this. The entire tornado cash verdict, they say, is completely insane and will turn the legality of building any privacy service on its head because what it shows, David, is three things, that the devs are fully responsible when their open source code is used.

for criminal activity. That's crazy. How can they be fully responsible for that? And secondly, building an unstoppable privacy system as laid out suggests criminal intent. So even if you're building any privacy system, then criminals could use it. So that means you are a criminal. Absolutely crazy that that's how this would be interpreted. Alexei's co-founder Roman Storm is facing similar charges in the United States. He's from Seattle. And so that is also going to be very informative about how the United States approaches this same exact issue, hopefully with a little bit more freedom and less oppression. That trial is scheduled to go before a federal court in New York in September. Right. So that's the bad news on the week, David. But we got some good news too. What's the

good news? Give it to us. The continuation of the repeal of SAB-121 moved into the Senate this week. Last week, it was voted to be repealed by the House. We want it to be repealed. This is a rule coming out of the SEC. that the Congress is like, yo, WTF, this needs to, like, go through actual legislation. So they are voting, Congress is voting to repeal it. We want it to be repealed because it basically stops any sort of commercial enterprise to ever facilitate the custody of crypto assets. So we, the industry, wanted to be repealed.

It was voted to be repealed by the House last week, yay. Just this morning, it was voted to be repealed by the Senate by a 60 to 38 vote. So pretty solid vote. It's huge. It's actually, that is surprising. I think even like people who are bullish on this were surprised by these numbers. Because that means a ton of Democratic senators actually voted against the White House and for this pro-crypto legislation. Yeah. So it was expected that this vote would go in favor of the repeal. It was not expected that this discrepancy, the 68 to 30 vote, was this large. This is the thing that Biden said that if it comes across his desk, he will veto.

And so he just, this is what he said last week. And this is what kicked off last week's, like drama between the Dems and the Republicans saying, like, well, clearly Biden is an anti-crypto candidate that just got cemented. This is the thing he will say he will now veto. So now he has to go veto it to actually like, you know, put his money where his mouth is. I think this is absolutely crazy because not only Biden said he would veto it. And it's not just declaring the intent for the White House to veto this, but it's part of that, right? But it's also just, I think that's a message to Democratic senators, like, get in line. Like, vote this down.

I mean, don't embarrass me in an election year. I said I'm going to veto this. We have to stand by our guy, Gary Gensler, who created a rule that says, never mind whether it makes sense or not. That says, you know, like all banks, anyone who wants to custody crypto in the U.S. It's an institution of some kind, can't do it. Never mind whether it makes sense or not. We have to stand here and veto it.

And this is a whole bunch of senators just going against the United States. the White House in a key election year. What this is to me, David, is Elizabeth Warren's anti-crypto army getting publicly crushed, like publicly humiliating. Yeah, and to add to that, even Chuck Schumer voted pro-cropto on this one. So it's not only a repudiation of Elizabeth Warren, I think it's a repudiation of Gary Gensler. And this is why, David, I still, I still haven't given up hope on the EPP. There's still a chance. There's still a chance. But this all puts it in Biden's court. So this bill is now going to come across his desk and is he going to do what he said he would do last week, which is a veto it. If so, that is a marker. You're basically voting anti-crypto at that point.

It's coming from the White House against Congress and against many members of his own party. So what do you think happens? Like where do we go from here? Well, the obvious thing is Donald Trump just takes the free real estate. And so all he has had to say, which he has had to say, which he's did say is that he told crypto backers at his Mar-a-Lago press conference that they better vote for him because the Biden administration has unleashed a regulatory crackdown on the industry. Whether or not Donald Trump is at all pro-crypto does not matter because the Biden administration is just serving him the crypto vote on a silver platter, which he's like, thank you. That's for real estate. That's mine now. Yeah, the fact. So this is an article that came out on Friday. I know you were

climbing mountains, David. And like, so you probably weren't, we're looking at this, this political stuff. But this article with the title, Crypto is Trump's new weapon against Biden. This was published in Politico. So what, like, the normie political people read, right? This is not like on coin desk or on bank lists or somewhere else. This is on Politico. Okay. And so Mark Cuban retweets this article, this very article and says, if Joe Biden loses, there's a good chance you'll be able to thank Gary Gensler and the SEC. Crypto is a mainstay with younger and independent voters. Gensler has not protected a single investor against fraud.

This tweet gets like almost 20,000 likes, a whole bunch of retweets. Yeah, it goes absolutely crazy. He says, this is a warning to Congress. Crypto voters will be heard this election. All right. So there's a lot of clamory. People are starting to see the tide shift. and that is the backdrop to this like 60-38 vote.

And you can see really Donald Trump taking advantage out of this. Last election, he was really just like anti-Bitcoin pro dollar. He decried crypto on social media during his presidency. And then key cabinet members, Steve Mnuchin, remember, that was like the whole like introduction of this like self-hosted wallet term. He wanted to ban non-cissodial wallets. Since Donald Trump's election, he has minted an NFT collection as a crypto-neutral. net worth of $7 million, holds $5 million of Trump.

Is that a token or his NFTs? I don't know. His last activity was sending 250 ether to Coinbase five months ago. His NFTs earned him $2.8 million in crypto. And he's a B on Coinbase's stand-with-crypto report on crypto-friendliness. B, like, way better than any of the Democrats. Also, since Donald Trump's last presidency, We got the paradigm poll last week. We talked about this last week.

48% of crypto owners favor Trump. 39% favor Biden. 13% is undecided. But 20% of voters in several battleground states consider crypto to be a key issue in the elections and are crypto favorable, which is a large number. 20% of voters in battleground states. And so to say that crypto is like going to be an issue here is like we know that that's true. I mean, it seems like it seems like it could swing the election. Like I know.

I know people are like, of course, I'm listening to a bank list, a crypto show. And of course you guys think you're powerful enough to swing the election. But like we're talking about the marginal voter here. We're talking about really tight margins. We're talking about independence. And you're also swinging some like a single issue voters like the other direction in this. We should say, of course, not all Democrats are anti-crypto. So a number of them.

It's just the establishment. Yeah, and a number of them voted for this policy. Here's a tweet from a Democrat representative in Congress. Representative Wiley Nicol, we cannot hand this issue. He means crypto to Republicans. Digital assets shouldn't be a partisan issue. I'm going to continue working a bipartisan way to support Web3 so we can protect American consumers. There's also Gilda Brand who's been very, she's a senator.

She's been very pro-crypto. I assume she voted in favor of the SAP 121 repeal. She gets an A strongly support. on stand with crypto. So there's some of them. In fact, some people are saying that this is not really a partisan issue at all. It's more of a generational one. This is a tweet from Sam Lyman. Case in point, 21 Dems voted to rein in Gensler's overreach on crypto. I think that was in the house. The average age of this voting group, 48, contrast these young Gen Xers to the Dem party leaders they defied with yesterday's vote. Maxine Waters is 85. Joe Biden's 81. Elizabeth Warren is 74.

So he's basically saying that this also skews like old versus young. It's neoliberal versus progressives. I think so. I think there's an element to that. But I will say a lot of the so-called like neoliberals in the Republican Party have definitely swung in the direction of crypto. And I think they're just partially just doing that to stand in contrast to like watching the Democrats shoot themselves in the foot over this issue.

Well, anyways, this issue is going to be a recurring theme until now and September. until this election actually happens. So bankless nation get used to politics being in the weekly roll-up, whether you like it or not. Sorry, I don't necessarily like it, but nonetheless, it's relevant. Coming up next, the Department of Justice charges two brothers for a $25 million attack using MEV bots. Was it crime? Or was it just a highly profitable trading strategy? We also got Crackin versus the SEC and a new social file layer two architecture that could host a billion users and die, the stable coin is going to fork into two different kinds. What's going on with all of that and more. But first, a moment to talk about some of these fantastic sponsors that make

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The Sello Layer 2 will bring huge advantages like a decentralized sequencer, off-chain data availability, secured by Ethereum validators, and one block finality. What does that all mean for you? With Sello Layer 2, gas fees will stay low and you can even pay for gas natively using ERC20 tokens, sending

crypto to phone numbers across wallets using Social Connect. But Sello is a community governed protocol. This means that Sello needs you to weigh in and make your voice hurt. Join the conversation in the cello forums. Follow Sello on Twitter and visit cello.org to shape the future of Ethereum. The title of the press release on the DOJ website, Two Brothers, arrested for attacking Ethereum blockchain and stealing 25 million in cryptocurrency. So, David, there's the accusation.

against these two brothers, a conspiracy to commit wire fraud, actual wire fraud, conspiracy to commit money laundering. It turns out they exploited through some MEV-type exploit, $25 million. When I saw this story come through, I didn't quite know what to think because the DOJ is doing all sorts of things these days. In fact, it's the DOJ versus Roman Storm, and they're calling tornado cash money laundering. So I didn't know quite what to make of this particular case. had not been following the details.

So what are they? What is going on here? So whenever the case of like the Department of Justice and Nation States and the world of MEV comes up, like this idea of code is law always gets invoked. And generally the powers that be never really think that code is law and actually this thing called wire fraud and it happened. And this is actually one of the more unique MEV cases that we've ever seen. So there was an exploit here specifically.

And this was not about code on Ethereum. This was not relevant to code on Ethereum. This was not an exploit of a smart contract. This was in the pre-block chain layer around block builders, flashbots, mev boost, and the eventual block proposer. This is how all happened in the Mempool supply chain networking layer before transactions ever landed on Ethereum. So was this an exploit of Meb Boost itself, like the FlashBots Mev Boost? This was an exploit of the Mev Boost software that allowed for the theft of $25 million, whether you think it's theft or not. not, I do think it's theft. And so let me explain the exploit and how I came to that conclusion

that I think is theft, which I actually kind of agree with the Department of Justice. That's just my take. But here we go. Okay. So typically block builders who build blocks and then they build the block, pass it off to the proposer, who is an Ethereum validator and the proposer just proposes it to the blockchain. The block builders receives bundles of transactions that they cannot alter or interfere with. They get data from MEV searchers. The MEV searchers search the blockchain. produce bundles of transactions for builders to build into a block. MEV flashbots, the flashbots Mev Boost Relay, which relays the blocks around whoever needs to receive these blocks.

They hide the content of these bundles from block builders because if block builders were able to see the contents of these bundles, they could just reconstruct a bundle themselves because they have all the data, submit that bundle themselves, and have that MEV collected for themselves. So you have to hide the bundle in order to protect the searchers so they can actually get receive their M-EV-V-V-V-Bose relay, which is a relay from flashbots, will return all of the transactions unbundled and disclosed if the producer, if the proposer signs the block correctly. And so once the block is signed correctly, you can now see the internal contents of that block because it's assumed that that

block propagates around the network and becomes embedded into Ethereum, so there's no longer the opportunity to steal that M-EV. Unfortunately, this is the exploit here. If that signed block is invalid, then it would never be accepted by the network. And so the block builder can sign a block legitimately, but that block can be a invalid block. And so then they can see the internal contents of those transactions, and then they can do their exploit. So because the relay was never able to broadcast the block. It was a simple matter of taking the revealed transactions, deconstructing the bundles, claiming the liquidity from MEV bots that were unlucky enough to be included in the block. So here's what happened. In this scenario,

some sophisticated a player baited an MEV bot to front run them by executing a sandwich attack in which they would buy up a bunch of tokens to be able to like dump on the person who was who was also buying them in that same block. Very standard practice. This is a sandwich attack, but this is the different part. The exploiter bought a ton of those tokens prior to the sandwich attack from the very standard sandwich attack that happens all the time. They bought the tokens ahead of time, and then they did this exploit where they unbundled their transaction, and then they were able to sell the tokens that they had bought to the MEV bot that tried to execute the sandwich attack. So they basically front ran the front runner using an exploit,

from the MEV boost relayer. The net effect is the MEV bot bought a bunch of tokens, which the exploiter had bought earlier at a much lower price. Since the MEV bot bundle was compromised, the exploiter was able to dump the token at a much higher price because they had baited the MEV bot into buying it, again, through an exploit in the relator.

So first of all, that's really smart. I think these were, with these MIT students, like college kids or something like this? I don't know. Brothers working on this? Perhaps, yeah. That's a very sophisticated. Very sophisticated exploit, I would say.

But what you're saying is essentially they baited MEV bots using an exploit in order to steal these funds. So because when I saw this headline, I was wondering, is the DOJ trying to say that like all MEV arbitrage, all of that stuff, the things that makes market efficient is all of that illegal? Are they going after that? And you're saying, well, this is kind of an edge case where it looks like using the exploit to. to kind of hack. I'll use hack and air code to hack. I think it's fair. I think it's hack steal like $25 million. And you think this is a legitimate case brought by the DOJ against these MEV exploiters. This is, I'm not an expert in wire fraud. I'm not a lawyer, but I'm pretty sure this is just what wire fraud is. Like this was not the intent of the MEV bots. This was a bug and a

software that was exploited. And also there's, this is not perfect evidence, but post, both pre and post the actual exploit, the exploiters Google searched some terms including money laundering, computer fraud abuse, and does the United States extradite to like foreign countries. And so bad facts, not great facts. Not great evidence, not great facts. Although like Google searches doesn't necessarily mean that what they do. Like this is why all of this has to be proven in a court of law. Yeah. But it doesn't sound like it's a, it's a case of just like MEV arbitrage. Oh, years in jail because that's what the charge is 20 years in jail and this is a contrast point so let me read

out a tweet that you said in your you're kind of like I'm talking about this at the beginning code is law according to a theorem you say law is also law according to nation states these are not mutually exclusive you can execute code according to the EVM and you can also go to jail for that this is not a difficult take so what you're basically saying is a lot of people came out and said well because it was possible to do the exploit right it worked in the code like this is not criminal activity it's not real theft. This reminds me of some of the arguments being made in the Dow hack, like back in 2016, like it was technically possible to exploit and steal all of the money inside of this Dow. But was it legal? Was it still theft? Also, yes. Like, also yes.

So actually, I would actually make a contrast between the Dow hack and this. What do you think? The Dow hack was a exploit of on-chain code that was on Ethereum that didn't have any terms and and conditions. I don't think the FlashBot's Mev-Booze relay has terms and conditions. But you'd bucket both in theft, in the category of theft. Would you not? I think that this is way more thefty than the Dow hack. I think, like, maybe at the end of the day, a judge would say, like, the Dow hack was

theft. But, like, I think you could make a reasonable case that it was not theft because it was executed as the code intended. So there's a spectrum of theftiness, let's say. spectrum of theftiness and this is pretty damn thefty. Both cross, for me, both definitely crossed. Like, it sounds like both crossed the line, but you're saying that this was even farther across the line than the Dow has.

Because this actually was not about on-chain smart contracts on Ethereum. This was about third-party proprietary software called Mev Boost operated by FlashBots, which then immediately went and fixed that patch. Like, this wasn't a difficult patch to fix. Well, okay, let's say you're right, and this was actual theft, and the DOJ has to approve that in a court of law. And that's kind of what the legal system is set up to do. If somebody beats a crypto person over the head and steals their ledger and takes all their money just because they can because Code is Law, most people want the legal system to help them in those cases.

But this is some downstream impact maybe from Muhammad who says the indictment from the DOJ for the traders who baited MEV bots is mind blowing. First of all, it dives into every detail of how Ethereum block building works and draws out analog to tradfi. So DOJ is getting really smart about this. So this is both, one, a recognition of the power of Ethereum to settle financial transactions. Yay, good. And also, number two, a trap to pull every operator on Ethereum into a web of legal compliance requirements. That's what I worry about, David. This is what I worry about, that this kind of thing sets precedence for, yeah, come in and

register all your validators. All your ETH staking has to be registered. It has to be compliant. Like Nation State says there's bad things going on here. And so everyone has to kind of like, no code isn't law at all. Like there's no such thing as code is law. Law is law. And we don't respect any of the code-based protocols that you put into place.

So come in and registered, you know? That's what I worry about the precedent and this type of thing. Yeah. There's definitely two different philosophies I play here. Nation states prevent like trad, phi, M-A-V. They prevent it with laws. Like if you do like M-AV in the trad world, you go to jail. We in the crypto world, in the Web3 world, try to prevent M-AV with.

mechanisms, which I think are much more robust and less prone to corruption. But nonetheless, we have the regulators coming in to interfere with our goals and desires. And when you say M.EV, right? You're talking about like bad, clearly over the line, illegal MEV, right? Because there's also MEV that happens in Tradfey all of the time. Just go. Market Arbitrage. It's just. Arbitrage is also M.EV. It's called front running and it's legal. Do you know? It's market arbitrage. And so that can happen as well. We'll see how that case turns out, though, David. Tell me, tell me about Lens protocol. Scaling to billions of users? Yeah, moving on to extremely crypto-native things,

Lens has launched Lens network on the ZK stack from ZK Sync. And so this is going to be a hybrid rollout phase as the Lens Layer 2 gets more and more robust. It's starting off with off-chain data availability. They're calling this the seed phase. A ZK roll-up with off-chain DA is called a Validium. Later, optional on-chain DA, if the user so choose, this would be the bloom phase of Lill-Lase.

lens. And this is called a volition where you have a ZK roll-up, but users can choose to have their DEA settled on Main Net Ethereum if they just want to pay a little bit more. Additionally, some improvements as well. Gasless, signless transactions using account instructions, so no more wallets with embedded wallet support and also network bridging and near instant transaction finality. This is the power of ZK roll-ups. This is the power of ZK stack. This is why we like ZK stuff. This is pretty exciting to me because I think this architecture that they're selecting, which is like ZK Sync, ZK.EVMs, with with Validium, DA, right?

And then the option to put DA on chain through a volition. I think this scale, this architecture scales to billions of users, Ethereum. It's like the power of horizontal scalability. It's pretty end-gamy. Yeah, it's not saying that that's all ready and available right now, but it can scale. Like, you don't need a new architecture in order to scale it. And that's pretty bullish to me. It's also, we should shout out, David, the permissionless conference, which you'll hear

us talking more and more about this as the weeks progress and the months progress. That is happening in October. What are the dates of the Permissionless Conference, David? October 9th through 11th, where both Stani from Lens and Alex Glucowski from ZKSink, they'll be both at Permissionalist. So whether you want to talk about Socialify and Lens or you want to talk about ZK roll-ups and ZK Tech with Alex,

both of those people, both of those leaders, will be at Permissionalist. If you are listening to this, you can get a 10% discount. Bankless 10 to get 10% off your tickets. If you are a bankless citizen, you can get a 30% discount on the perks page at bankless.com. David, the airdrops meta has been shifting recently. There's this battle with Sibbler's who are trying to farm all of the airdrops, spin up fake accounts,

and Layer Zero has been an interestingirdrop for that because they're trying to get rid of these Sibble attackers. What's happening with layer zero on the week? They're only trying to get rid of 85% of these Sibyl attackers. Well, Sibyl attackers receive 15% of the otherwise issued tokens that they would have gotten if they had, quote, unquote, gotten away. with it. It's like come in and turn yourself in. Turn yourself in for 15%. Yeah. So like take an 85% haircut and still get 15%. Is this tweet right? Up to 100,000 self-reported cybil addresses. Yeah. So it sounds like people are just taking the 15%. It's like, well, yeah, I kind of sibbled you guys, so I'll just take the 15%. That's a lot. This is nice. A hundred thousand addresses, yeah. And like, so is a reduction of 85% but like the costs of spinning up civil accounts is also very low.

and so I kind of think 15% is pretty generous. Overall, this has caused, like, a bunch of conversation around Layer Zero strategy about, like, Sibyl attacks. They benefited from Sible attackers. So, like, should we be even pruning Sible attackers? They're not totally pruning Sible attackers. They're giving them 15%. Overall, I think, like, Layer Zero is doing a pretty good job

threading the needle of, like, like, not rewarding everything to Sibyl attackers, but still allowing Sible attackers to have some skin in the game. Like, so far, it's been, like, a pretty productive conversation. I also like how obvious it makes it that these people are sibling. Because like why would you self-report unless you truly were a sibling? And so we get a headline with like 100,000. It's like, oh, crap, there's lots because, you know, it feels more centralized to have it all at the discretion of the team. Does that make sense?

So just say, no, these addresses are siblings. Well, how do we really know? When they self-report. There's going to be a line that the layers your team chooses as to what is a civil and what is not a civil. They still have a centralized choice to make. But the self-reporters are getting ahead of that and just they're clearly, they're clearly Sible attacking, aren't they? What's interesting is that you can actually narc on Sibyl attacks and get 10% of a Sibyl's

allocation if you narc on someone who are unreported, which is pretty funny. David, tell me about the future of Dye. It seems like there is a fork in the road and Dye is moving in both directions at once or maybe one direction more fervently. So tell me what's going on here. What's this tweet from Rune at the end? the Maker Foundation. Rune tweets out reconciling the two opposing paths for decentralized stable coins. And then he goes and talks about the stable coin trilemma and talks about just like the

tradeoffs of having a fully permissionless version of a stable coin versus a more compliant version of a stable coin. So he is proposing to fork a dye into two new stable coins, both with placeholder names. One is called new stable. This is the one with real world assets as collateral and will also have, this is the new thing, a freezing contract. And so Maker Governance can freeze addresses as needed just like USC, just like Tether. Like Oax Sanction type stuff. So, yeah, just to be more compliant. And so that's New Stable.

And then he's also proposing Peer Die, again, I placeholder name, with governance eliminated, crypto-only collateral and no freezing contract. So Maker-Dow is just like trying to do both. interesting strategy. New stable will be the focus of MakerDAO. That's going to be the main product. I'm going to guess that's the one that's going to dominate in market share. They are pointing all of the yield from die savings rate,

which is like the accrued fees of the MakerDAO balance sheet. They're pointing all that yields towards incentivizing growth of new stable. Pure dye will remain as a censorship-resistant option, so no freezing contract and no governance, which is what many people wanted in the space out of dye in the first place. All-Eth as collateral, right, basically. So it's all completely cryptosities as well, but just or some sort of censorship-resisting.

Just crypto-native stuff, like Stake Dith, Eth, maybe anything else that's censorship-resisted entirely, yes? Yes, that's right. Yeah, yeah, yeah. And so this is what Maker-Rune is proposing as the future of dye. It's actually two stable coins. I'm going to guess one is going to be like the market cap of the compliant one. It's going to be like 95% of the market cap.

And then pure die is going to be like 5% of the market cap in the fullness of time. What's your take on this? I know both you and I got started in DFI with Maker. It caught the vision and, you know, here it is. And as you said, this maybe 95% goes with the new stable rather than pure dye. Isn't this just like letting the market decide? And if the market chooses to go with the kind of the regulated, you could freeze me, stable coin, then like the decentralized one isn't as popular and the market's spoken?

What's your take on all this? Yeah. So I've always been like, people have criticized MakerDAO for having real world assets. assets as collateral, like the critique is like MakerDAO is just like a USC wrapper. It's not censorship resistant. I was always like very resistant to those takes. Both the censorship resistance of the die ERC 20 token and the buffer that is both the risk parameters of the vaults of MakerDAO and the MKR backstop. These are all filters that filter out the risk profiles and the actual values of the assets that back die from actually going into dye.

So you can have like real world asset collateral. You can have USC collateral, but nonetheless, die is a censorship resistance table coin. And also if like some of that real world asset collateral gets rugged, then MKR gets printed to preserve the cipher punk values of die. And I've always thought that that's like, we can make compromises, but we can also like minimize those compromises by making sure that they don't impact the value of dye. And so I've always been like, you do have your concessions because like they very minimally

work their way into the die token. And now this is no longer the case. So like this is a kind of disappointing to me. But also I get at the same time like if Maker Dow is trying to maximally scale and we are also living in a time in which we are not living in that authoritarian of nation states, then like maybe new stable,

the compliant stable coin is the way to go because we just don't need a censorship-resistant stablecoin if nation-states aren't being authoritarian. And if that inverts and nation-states do become a authoritarian, then at least we still have pure die. And then maybe the market will demand more pure die. And so I guess we have both options, but I do think that this is a concession that I wasn't necessarily like thrilled about. Yeah, this is a case where the center cannot hold, it seems like. And I guess I wasn't disappointed with it. I was actually kind of like, oh, cool, we're finally like calling it for what it is.

It's just like we can't do real world assets backing our stable coin and also like keep max decentralization, right? Because like I don't know. No one who holds MKR wants to go to jail, right, basically. And so it's like you're forking both and maybe we get to have both and the markets choose. And in good times, maybe we'll be okay with a centralized you can freeze me type of stable coin. And in bad times, we revert to the pure die. okay so I'm just hopeful the pure die really gets off the ground it's it's been a little disheartening to me and I know to you as well that like when given the choice people don't choose the decentralized

stable coin but like maybe that's the market reality I I will say for for myself personally I don't have strong preference of like die versus USC right but I do have strong preference for like bitcoin and eth versus USC and so like there's an element of like store value in these crypto-native assets, and then for just like payment coins, that kind of thing, I use a stable coin. So maybe that's just the reality of product market fit for this, and this is how it has to turn out. Yeah, maybe that's right. Anyways, this is just a proposal. We will see this actually play out over the long term as the maker end game progresses. Once upon a time in Shaolin, if you don't know what that is, it's because you're not a Wu-Tang fan. I wasn't a Wu-Tang fan until I joined

Pleaserdall. This is a very famous one-of-one album. that got created way before crypto was even relevant, was sold to Martin Screlli, who had to forfeit it to the U.S. government when he went to jail for whatever he was charged for with a whole like insulin thing. Yeah, jacking up prices on insulin, yeah. Jacket up prices on insulin, yeah.

And then Pleaser Dow, or I bought it from the U.S. government as it was auctioned off. Pleaser Dow is releasing once upon Chowlin to the public, which is the crazy thing that people thought was impossible. There are going to be details revealed to this. If you want to be a part-time owner of the Once Upon a Time in Shalyn album, you can go to thealbum.com and stay tuned. A quick update this week on Cracken versus the SEC. That's another court case, of course, that's going on.

They are asking the courts to dismiss the SEC lawsuit entirely. Cracken's lawyers are saying that the SEC has not identified any investment contracts that would or could be traded, brokered, or settled. on Cracken. They're basically saying this is a frivolous case. The courts shouldn't even hear it. Just like save us all time. Save the tax payer some money and just like dismiss it. Coinbase tried this of course too. Part of their case was dismissed. Part of it wasn't. So we'll see how Cracken fares here. Of course, the SEC is folding their hands and like crossing the arms and saying, nah, we have a case. And so we'll see what the judge has to say in all of this.

Polymarket, the prediction market, raised $70 million this week, decentralized prediction market that allows users to place bets on future events that will happen in the future, of course. $45 million raise Series B from Founders Fund, this is Peter Thiel's Fund, one confirmation who are also early investors in it, Parify, Dragonfly, and also Fatalic Buterid, which is actually kind of interesting because, like, Fatalc, I'm assuming, when he makes investments, he's not doing it for a capital return. Like usually he makes like, yeah,

his investments are like basically grants. He kind of wants to see the thing manifest in the world, usually. Yeah. Yeah. And he's also been a big fan of prediction markets. So Polly Market has been like running along for years. Hasn't totally exploded into mainstream has at times kind of acutely, but still doing pretty well.

And I would definitely say crescendoing in relevancy, still looking for its breakout moment. Yeah, I think this election cycle could actually be it potentially. Like Trump first and Biden, people love betting on a, politics and the UX is actually like super easy to use these days. We did an integration at Bankless with a use case that feels very native for Polymarket, which is what's the probability of an airdrop in a given quarter? And like we integrated that all into the AirDrop Hunter.

Oh, wow. I actually did not know this. You didn't know this. It's like 53%. So chances for airdrops by June 30th is all data provided by Polymarket. ZK Sync, you know, chances 53% and you can go through the air drop hunter and like you sort by the highest probability. chance that ZKSync is going to happen by June 30th, according to Polymark.

Yeah, right? It's a great use of prediction market. This is super crypto-native. So, yeah, we love that data set. And also, there's another prediction market that's going on, which is. This is going to be the breakout. Yeah, this is going to be the one. Forget Trump and Biden.

It's Nick Carter versus David Hoffman. Who's going to win is coming up May 30th. The karate combat fight. 14 days away. Oh, man. You ready for this, David? Like Nick's not going to be a lot. between me and Nick Carter is split

perfectly down the middle. Wow. It is 47% to 47% Nick to David and then a 9% those numbers don't add up, but a 9% draw slash no winner. Okay, so that's really evenly split, man. This is of course the promo and I didn't know this but Cracken is

apparently sponsoring this event. So shout out Cracken. Yeah, we know which side Cracken's on. What's up Cracken? this is the uh the alt uh promo yeah which i personally prefer this is a fantastic picture of of david hoffman and a um you know like nick carter nick nicoge uh yeah nick in the week on weak dog's face on weak doge body this is this is a nick photo from uh when i think like i first knew nick that's that's how i got to learn about nick carter yeah that's see that photo that was his headshot yeah he that's always the nick carter to me like miami nick i mean that's a different. Miami Nick was like a big pivot

away from academic Nick. I personally would not want to fight Miami Nick. I would consider fighting New York Nick. Glasses Nick? Yeah, glasses Nick. Glasses on glasses? Like, maybe. But not Miami Nick. You are a bold man. Yeah. Yeah. My stash nick. Yeah. Oh, you're talking some smack. The two hardest men in crypto. Here they are.

Speaking of old photos, this is David Hoffman. From my old headshot. You haven't seen this. This is David Hoffman standing, I believe, The lore of this. Pre-2020 Bull Market, David Hoffman. Standing in front of a literal Wells Fargo bank, I think you had just come out of the bank.

Did you make your deposit? Did you? No, so that was the Wells Fargo Tower, Wells Fargo Center in Seattle where my first crypto job was. Wait, your first crypto job was inside of a bank office? It was a big tower.

It was like, Wolf Lago owns the tower. Oh, man. Well, glad we got you out of there. You literally, literally going banked. Bankless. No more Bank Towers here. I think we're going to have a watching party for you, David. We're going to have to live stream this again. Bankless listeners want to know where to watch the live stream for the Nick versus David Fight. It's on the YouTube. So if you're already on YouTube, then you're already there. That's what we're doing. I guess I'll be announcing it. I don't know what we're doing for that. I don't know if you have those skills. I don't have those skills, which might make it more entertaining, but we'll see what we can put together. Somebody better than me knows what they're talking about with karate. Karate. combat. David, you ready for the meme of the week? I don't know what I'm talking about with

karate combat. Meme of the week, here it is. What are we looking at? We're looking at the, oh god, how am I going to explain this one? I don't even know what this thing is, but we have a shiny, strapping young crypto person thing saying code is law. And then we have two very buff, much larger people. One is the United States. One is the European Union laughing at said tiny little crypto and starts beating the absolute shit out of the crypto. saying code is not law. We are law. If you're going to be law, you kind of need an army. That's what they think.

I don't think they're right, though. All you need is social consensus. Proof-of-stake validators are social consensus? You just need some coordination. Yeah, we could do this thing peacefully. That's what the crypto revolution's all been about. But we are getting beat in the face right now. That's what it feels like on the week to be in crypto.

Oh, man. Guys, well, we got a job opportunity, but you're going to have to stick around past the disclaimers to get there. And here they are. Crypto is risky. You could lose what you put in, but we are headed west, of course. This is the frontier. It's not for everyone.

But we're glad you're with us on the bankless journey. Thanks a lot. Oh, by the way, we're hiring. Podcast Operation Summer Internship. David, what is this? We need more firing power on the Bankless podcast team. So we're looking for a summer intern. If you know about audio and video editing, then we want to talk to you.

Fully remote, of course, because Bankless has no offices. And so if you can work with the team and work with our very Chad podcast team, there's a link in the show notes to apply to be our podcast operations summer interred. This is the frontier of podcasting. It's what this position entails. See you guys next week.