Bankless - ROLLUP: SBF Arrested | Trump NFTs | Binance Bank Run | Fed Inflation | Proof of Reserves | Bored Ape Lawsuit

Starting point is 00:00:00 SPF got arrested. It's such a great day. Turns out his 4D chess was just him playing checkers. Ladies and gentlemen, we got him. Bankless Nation, happy third Friday of December. David, what time is it? Ryan, it's the Bankless Friday weekly roll-up where we cover the entire weekly news in crypto, which is always an ambitious endeavor. Yet we persevere into the frontier, into the end of the year, nonetheless. How are you doing? I'm doing great, man. It's going to be good to close this one out, this year, that is. But we got a lot to talk about this roll-up. And David,

Starting point is 00:00:31 I think you're, are you wearing your SpongeBob a sweater? I've seen you in that for a while. High Fashion Friday. High Fashion Friday. That feels like a good kind of like holiday sweater. It looks comfy. Looks like pretty relaxing. How are you feeling, man?

Starting point is 00:00:43 You feeling okay? You feeling relaxed? Dude, I think I'm pretty, I'm feeling good. I'm feeling really good. I mean, we all know how bad this year was. But I think that we are on the precipice of good stuff because of what happened this week. SBF got arrested this week, Ryan. I started December saying December is the best month.

Starting point is 00:01:06 SBF got arrested. The redemption arc of three errors capital is coming to a close. People are having none of that. And so we're going to cover all of this news and more. In addition to that, Binance is seeing all-time high outflows. Is a run on the bank happening with Binance? Are we about to do this all over again? Or is this just happening in an abundance of caution?

Starting point is 00:01:27 People going bankless. We'll talk about that. What else we got, Ryan? We also have one of the best investigative journalists, or so we thought, called The Block. It turns out that was secretly owned by SPF. Yeah. What a Mastercraft villain we're dealing with. So we talk about that.

Starting point is 00:01:42 That hit me pretty hard on Friday. We'll talk about that a little bit. And also, David, I'm hearing some rumblings. I'm hearing some things about the world's greatest NFT drop in history. Who is dropping an NFT? Oh, we can't tease that. We can't tease that now. But let me just tell you, Ryan, it's a big, big deal.

Starting point is 00:01:59 The world has never seen an NFT drop this fantastic. We're going to make NFTs great again. Folks, let me tell you, NFTs are the future of digital ownership based on the most advanced technology out there, blockchain. And we're going to drop the biggest any NFTs anyone has ever seen more later in the show. David, did you get any comments about your Trump impression from last roll-up? You know, positive or negative? The scammy YouTube comments, absolutely, like the bot farms that are also on YouTube, kind of drowned out all the YouTube comments. comments last week. I didn't get any comments, but I'm coming from round two. He's fishing for it,

Starting point is 00:02:33 all right? Because I bet if you could guess who that was, who David was in person, you probably have a clue on who is dropping an NFT as fresh as of today. David, before we get in, we got to talk about our friends and sponsors at Cracken. What are we doing with Cracken and what is Cracken up to? Yeah, so we're actually rethinking. Bankless is rethinking our sponsor strategy going into 2023. We want to form more intentful, more surgical, long-term relationships. And so we're working with Cracken, who is the only exchange that pioneered and implemented proof of reserves before anyone ever asked them to. When we had our conversation with Jesse Powell from Cracken, the CEO who's been headstown building since 2014, I just felt like he is the Eric Voorhe's type.

Starting point is 00:03:19 He's the libertarian who's doing what he needs to do to help move this industry forward. And so when he came on, he was like, yo, use Cracken. then get off Crackin. And also, and also you should use other exchanges. Don't put all of your eggs in one basket. That was super refreshing to hear. It was in stark contrast to the scammers that have pioneered 2022. Jesse came into the industry way back when he's been head sound building ever since.

Starting point is 00:03:46 Very an egoless individual. And so we've chosen Cracken for a long-term sponsor. We're going to have more details about this into 2023. But right now, if you are unsure about your exchange, perhaps go to the link in the show notes, crackin.com and sign up for the exchange that implemented proof of reserves before anyone ever asked them to. An exchange that didn't rug you last year as well. Doesn't that feel good to say? Exactly. I'm going to be moving some more of my stuff there as well, guys. All right,

Starting point is 00:04:12 well, let's get in. Let's talk about markets today. Bitcoin, what are we looking at on the week? Give us the price data. We got a flat week, Ryan. Bitcoin ended up 0.7% started the week at 17-2-60, ending the week at 17-380, so 0.7% up. All right. Neither higher nor lower very much, just kind of flat-ish. Eath as well, same-same. Down a little bit, down 1.1% started the week at 1285, ending the week at 1270. Got up to 1330 on the positive CPI print, but then fell back down.

Starting point is 00:04:44 You know, 1.8%. Part of the recent, David, I'm feeling, I guess, rejuvenated coming to this episode versus some of the others in November is we had that Heath Bulls episode that we did. This is an episode that's coming at you on December 26th. All about ether. It's an Heath Bull panel that we do about every six months

Starting point is 00:05:02 and six months and this one was especially good. So good. But I remember something that the DC investor made the point, look, we are still below 2018 all-time highs for Heath, right? What's interesting is like he put out this tweet

Starting point is 00:05:18 a few weeks ago we just said, like, I didn't buy at 80, but I bought at 120. This is during, you know, 2020, I guess, but, you know, bear market. And he's like, there is no difference. There's literally no difference between the two. Don't remember the difference, right. It's crazy. It's like, that's kind of what the numbers look like now, only it's 10x different.

Starting point is 00:05:38 Like, our low for ether was about 800 or so. It's high 800s, really. And now we're at, like, 12, 1,200s, right? The Delta is the same. So, and we're below 2800s. We're below the last all-time high. So I'm not saying ETH is looking juicy at these prices, but the ETH Bulls certainly are. And they will be on the 26th when that episode releases.

Starting point is 00:06:01 And yeah, it just seems like a good time to keep dollar cost averaging in. Yeah. And the point of that tweet was that like when Ether hit $80, like it didn't stay there. It bounced right back up. And so he was just reminding people, it's like, hey, you don't have to time the Pico bottom. Yes. Buying at $120 Eth just kind of blurred together with buying the $80. ETH. I made so many mistakes when I was a new, just like watching the charts and trying to

Starting point is 00:06:24 time the picco bottom when I should have just spent like dollar cost averaging in during the bear market. All right. Let's talk about the ratio. What's that looking like, David? Ratio down 1.8% down from 0.0745 to 0.073 down 1.8%. Holding up, though. Holding up. And Bitcoin and Eath down from all-time high. They're about neck and neck, aren't they? Yeah. Yeah. They're about the same. Like 76, 77%, something like that. Crypto market cap total, are we above or below a trillion dollars, David? Still below a trillion dollars, $885 billion, about flat on the weekend. Good question that we asked Vitalik, by the way, in our episode we recorded.

Starting point is 00:07:01 That's coming at you Monday was basically like, will crypto ever be a, you know, multi-trillion dollar asset class again or will forever be a niche? You had a really fascinating answer to that question. Premium subs already have that podcast. Oh, yeah, you do. Or at least something out in a few hours, yeah. Go check your premium RSS feed for that. It's a fantastic podcast. All right. Should we talk about, do our Fed watch, talk about macro for a bit?

Starting point is 00:07:22 Got to watch the Fed. Two things happened this week, David. The first is we got some CPI numbers. And that is inflation, of course, consumer price index. They came in lower than was expected. So that is good news. We are excited about that. And you can kind of see this over time. This is the chart from CPI changes from 2015 all the way to 2021. You see the peak. That peak was around like June-ish or so, and we're down off the peak. So I think the official numbers are something like this, David. June was 9.1%. That was the high for the year.

Starting point is 00:08:00 Now November, 7.1%. The numbers fall up. And previous month, October was 7.7%. Core inflation, obviously also down. Core inflation is like a subset of the main CPI number. That's another number to track independently. So that happened. And the question is, is inflation?

Starting point is 00:08:17 inflation over. Maybe we'll talk about that in a minute. The other thing that happened, David, is the Fed raised rates. So the federal fund rates, that's the interest rate, is now in a range of 4.25% to 4.5%. So the Fed Powell raised it by another half a percent. That was basically as expected. The market anticipated that. And so this is lower than the previous increases. The last couple of raises have been by 0.75 percent, and this was half a percent instead. And if you look at kind of the, like the markets, the prediction market. The target rate right now is people are thinking, the market's thinking the rate's going to be about 5% in 2023. So we might get one or two more hikes that are expected in that range. And by 2024, the market is saying

Starting point is 00:09:05 the rates will drop down to 4.1%. So that is what the average person thinks. And so I think there's like two questions here. The first question is, has inflation peaked? All right. Has inflation peaked. What's your take on that? Do you think we've, inflation's peak? Do you think CPI is kind of over and, you know, the intervention by the Fed and a combination of relaxation of the supply chain issues that we were facing over the past two years are kind of over? And so we've hit the peak and we're going to be fine from here. What do you think? So if you want to go back to that chart that you were just showing that shows the inflation chart, the inflation peaked in June, 9.1%, September, 8.2, October, 7.7, November this month, 7.1. So clearly, we are in a downtrend.

Starting point is 00:09:52 And while it's totally possible that it just reverses and keeps on going up in a way that we don't like, that is on the menu. But it is worth noting that the more that we progress forward in time, the more the interest rates that the Fed has increased in recent, in 2020 starts to take effect. when you raise interest rates as the Fed, that takes time to ripple out. It takes time for the effects of having to pay back money at a faster rate reaches the margins, as it reaches all of the economy. Like CPI is a lagging indicator, is what you're saying. Exactly. And so the Fed has been raising rates all throughout the year. And so there are the last one, two, three times instances that the Fed has raised interest rates. That has not shown up in the CPI print yet. And so there are, many instances of the Fed's raising rates that has not shown up that will continue to have an increase effect on inflation. So I think it's one of those questions. Are we, are we peaked? Have we peaked? The longer that it goes on where we are not going up, obvious. I mean, this is a really, really simple way to put this. Inciful bankless analysis here.

Starting point is 00:11:00 Exactly. The more that it's not going up, the more likely it is that it is peaked. And we are in almost, I mean, June, we're in December now. So we have the November print. Like, we almost have six months in a row of decreasing inflation. So, I mean, it's looking better. It's looking pretty good. Yeah. And then also just like there's been a longer time, but when there's been any news about the Russian invasion. There's been, I haven't seen much about supply chains. So like the global macro news cycle at least seems to be like quelling for like six-ish months in a row now. So like we're trending in an acceptable direction. Well, this professor at University of Michigan over at Econ, Justin Wolfers agrees with you.

Starting point is 00:11:39 He says this in this tweet, Core CPI rose by only 0.2% in November, which is yet another positive disinflationary surprise. Headline CPI rose only 0.1% in the month, also below expectations. This is remarkably good news, he says, for the second month in a row. Inflation has clearly peaked.

Starting point is 00:12:00 Inflation is clearly peaked. So much so, that brings us to kind of the next question in the analysis is, when can the Fed stop raising? It's a question, right? And we have politicians saying that they should stop now, that they've already gone too far. This is a tweet from Elizabeth Warren saying, The Federal Reserve's Chair Powell has just announced another extreme interest rate hike

Starting point is 00:12:21 while forecasting higher unemployment. I've been warning that Chair Powell's Fed would throw millions of Americans out of work, and I fear he's already on the path to doing so. I'm not sure what Elizabeth Warren's response to inflation would be. Do we just let it run? but that aside, there's clearly some posturing some pressure to not let these interest rate hikes trigger a recession. That would also be a bad thing, and politicians are increasing the pressure. So maybe that is a reason, this political pressure for the Fed to reverse course and change course earlier.

Starting point is 00:12:57 I'm just kind of triggered that Elizabeth Warren is trying to tweet at the Federal Reserve to influence monetary policy. Like Elizabeth Warren is a politician, not an economist. Our friend Kyla, if you scroll down, Ryan, I'm pretty sure it has the most liked tweet in response to this, where she responds to Elizabeth Warren and says, this is an incredibly irresponsible thing to tweet, which I agree with. Can we stop politicizing our monetary policy?

Starting point is 00:13:23 That is bad. But I don't think we can, David, is the answer to your question. I think no. And it's interesting you said, trying to influence the Fed. One observation I have, we might get into this a little bit later with some other politicians' tweets is,

Starting point is 00:13:36 you said the word influence. I think all politicians are influencers now. I mean, this is like a, look, we know the game, we see it in crypto Twitter all the time. This is a clout chasing type tweet. You're not necessarily wanting the Fed to actually stop. It's not that you actually think it's a good idea. You're kind of trying to collect the clout.

Starting point is 00:13:55 You're just being a populist? There's an element of that, certainly. And that is the game that they're playing. Now, Powell, the game that he's playing, is he's still saying that there is a ways to go. He's not responding to this political pressure, so continues to plan to increase interest rates. This is a quote from him. We still have some ways to go.

Starting point is 00:14:15 He told a press conference that was on Wednesday. I wouldn't see us considering rate cuts until the committee is confident that inflation is moving down to 2% in a sustained way. Restoring price stability will likely require maintaining a restrictive policy stance for some time. Restrictive policy stance for some time, not going to stop until we hit 2%, where our we, David, 7%. There's a delta there. Other people are saying, hey, 2%? Powell, what's so bad about 3%. We can live with that in a post-COVID era. And that is the slippery slope he kind of, I guess, finds himself in in this type of climate. Yeah, I think that's right. And I think there was a big conversation around the S&P and the stock market. And we're also seeing this

Starting point is 00:15:01 in the crypto markets as well, where we got the lower than expected inflate. and markets, markets rallied. That's when Ether got all the way up to the high high price of 1330. And Bitcoin jumped as well. The stock market jumped, and then everything came right back down to where it was. And then that bummed people out. It's like, yo, I thought this was good news. Like, why didn't we sustain this rally?

Starting point is 00:15:25 And the conversations I've heard around this are all about, well, it's hard to sustain rallies when interest rates are high. And so, like, okay, maybe we're not going to dump, but, like, have it. going up in price sustainably requires flows of buy pressure into these assets, into these risk on assets. And like, okay, we got this good news. We got this dopamine hit. But sustaining a rally when interest rates are as high as they are at four and a half percent. And like that's a bigger ask. And so some people have, I mean, they're not turning bearish, but it's hard to be optimistic when we can't sustain a rally because of, you know, there's

Starting point is 00:16:02 still. Yeah, there's still some work to. And especially when it's still uncertain. Like, we don't really know. Okay, so here's an interesting stat. A year ago at this time, if you're trying to predict what the Fed's going to do next, the Fed themselves predicted in December 2021 when asked what the Fed funds rate would be at the end of 2022. So a year ago, they were projecting the end of 2022. Do you know what their projection said, David? Tell me. 0.9%. All right, we're at 4.5%. And they thought we would be at 0.9%. That's the FOMC projections. Do you know what their forecast for inflation was?

Starting point is 00:16:42 The beginning of last year, the end of last year? 2%. Exactly what their target was? 2.6%. Actually, it's been, it's 7.1% today. So look, I don't know, it's just also clear to me that you can't always believe what the Fed is projecting.

Starting point is 00:17:00 They're just like kind of doing the math. Yeah, they're just extrapolating. the existing data of what they want to happen always. Anyway, that's what's happening in macro right now. What's happening in the housing market, though, David? Yeah, well, it's still a macro conversation. There's an article out of zero hedge here that caught my eye, which the headline was, nine million millennials moved back at home in with their parents this year. And I think during COVID, a lot of innovation, a lot of millennials, you know, got out of their parents home and to go, like, do stuff. the Fed jacks up the interest rates and we're seeing nine million millennials moving back home.

Starting point is 00:17:39 I think about there was a poll inside of the article that was like, all right, why did you move it? And it was all because of the economy. It was like a job and security, wanting to save money, can't afford rent. I mean, millennials. And they finally got out of their parents home from like the 2008 crash and I'll like, hey, mom, dad, I'm coming back. On the backs of that, there's also this chart I saw on Twitter this week about a rising

Starting point is 00:18:02 share of companies with debt servicing costs that are higher than price. profits. And of course, when you increase interest rates, if you have debt, you have to pay that debt back higher because the interest rates are going up. Therefore, there's a lot of companies out there that have debts. And as the interest rates go up and up and up, a higher and higher share of them are making less profit than they have available to send to pay back their debts to service their own debts. Right now, Ryan, we are at almost 20% of companies inside of the United States with debt servicing costs that are higher than profits. That seems like a large You can't sustain that forever.

Starting point is 00:18:37 Yeah. Right. I mean, high interest rates are the zombie killer. That is like the stake through the head. Right. So I guess that has to work. It's way through the system. No, that's not the right metaphor.

Starting point is 00:18:47 High interest rates are create the zombies. They create them, but then they also like kill the, I guess the zombies can't be killed is the thing. No, yeah. The zombie, yes. You go from being a human to a zombie because of interest rates. I see. I'm just seeing a world where all of these firms, like, they become, they're not even reanimated.

Starting point is 00:19:05 corpses. They're just dead. They're just gone. Well, yeah. So that's when unemployment, they, like people lay people off. Unemployment goes up. That's when this goes from a rising interest rates and a bear market to rising interest rates and depression. Yep. And deflation. Careful. Careful. I'm not ready for that. Sorry, recession. Recession. Okay. We'll stick with that. Give us some crypto takes, though. Okay. On to crypto take. So this is now about the asset prices of Ether and BTC versus some of the darlings that were of the second half of the bull market, the second half of 2021. This is a take from Van Spencer.

Starting point is 00:19:43 Looking back through the fog of war, the data points that are revealed today uncover the pieces of the puzzle from last year. If FTX was selling client ETH and BTC to buy Salana FTT serum, this has large implications about what organic ETH and Bitcoin price action would have looked like. And so this is the conversation that's been going on. It's like, oh, billions of inflows, billions of Bitcoin and Ether inflows into FTCS, into Sam-Bakman-Friedslfund. Where did they go?

Starting point is 00:20:12 A significant amount of those inflows probably went into the Sam coins, Solana FTT serum. Remember when Sam tweeted out, sell me all your soul at $3 and then F off? Well, probably why he was so confident in that is because he was taking customer deposits and buying all of his bags with them. And so there's a broader conversation that the industry is currently having as to how legitimate some of the price action was in these highly illiquid alt layer one Sam coins, Solana FTT FTT serum. And that has second order effects. Like why are things like Aptos and Suey have insane billion dollar valuations? Well, they rode on the backs of the valuations that Solana got.

Starting point is 00:20:53 And so because Solana's price action was absolutely insane, it created the Alt Layer 1 investment, like VC coin investment, to try and ride on the backs of that. So Van Spencer is saying the whole second half of the 2021 bull market was fraudulent because it was propped up by this like illicit, illegal fraudulent buying pressure of customer

Starting point is 00:21:14 inflows of Bitcoin and Ether into FTX and then Sam Beckman-Free just propping them up. And so his second tweet is saying that the absence of a fraudulent seller of Bitcoin and Heath on the order of tens of billions of dollars, the additional absent fraudulent buyer of Solana, again on the order books of 10, of billions of dollars, implies very different things about these ecosystems going forward.

Starting point is 00:21:34 And then he ties this thing off and says the Alt Layer 1 thesis of yesterday year was essentially an intellectual framework built around the first mover, Solana, whose initial price appreciation appears to be driven by Sam Bigman-Fried's fraud. In my opinion, this is extremely damaging to the narrative that any Alt-Layer 1 price action was organic. Oof, what a damning autopsy of the second half of 2021. It's, I, look, I think there's merit to this. I, the run-up of Alt-Layer ones, all of them, against ETH and Bitcoin, did not make sense to me at the time.

Starting point is 00:22:08 It was very confusing. And retrospectively, if people like Sam, well, Sam in particular, actually using depositors' funds, Eith and Bitcoin, and using those funds to actually sell those assets and exchange them for Solana and some other Sam coins. Which he was using as collateral, by the way. So he had to do that. Like, where did he get such a massive line of collateral? Well, he had collateralized FTT and collateralized soul to borrow a ton. Yeah. I mean, the price charts now they make more sense to me because, like, you could see definitely

Starting point is 00:22:40 some demand for these ecosystems, but it felt inorganic the entire time. And so Vance, in our most recent podcast with Vance a few months ago, he called the, the 2021 bull market, the first half, the high conviction rally and the second half, the low conviction rally. And so Vance already, his intuition was already like, there's a difference here. There's a difference in these moments. I just also want to call attention to people who have been right for a long time. And Vance Spencer is one of those people to me. Like he kind of is starting to fit in a Chris Berninski camp for me of like, oh, these are voices. I actually will listen to you. Why? Because they're proven over time and they've been right enough times. And so this is a signal that

Starting point is 00:23:22 that I often use and I think you could be right here. Coming up next in the show, SBF got arrested. It's such a great day. Turns out his 4D chess was just him playing checkers. Ladies and gentlemen, we got him. And after we'll cover all of that, we're going to talk about the run on Binance or not. We'll get to some of the details.

Starting point is 00:23:42 How much Bitcoin and how much stable coins are actually outflowing out of Binance. We got the numbers. And of course, Sam Bankman's last insult to the industry, secretly buying a cherished media organization. No, not bankless. And just really kicking us on his way out. So all of that and more right after we talk to some of these fantastic sponsors to help you go bankless.

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Starting point is 00:25:52 How does that make you feel? Well, I was surprised, actually, because what doesn't make sense to me, David, is the whole, like, awshucks. Gee, I didn't know anything about the speaking to her that he's been on, Good Morning America. And I was like, what does this guy know that we don't? So you have some kind of a get out of jail free card? Does he have some sort of bulletproof armor? We don't know. And so I was surprised. I'm not sure that much more makes sense.

Starting point is 00:26:20 Surprise, but also, like, relieved. Like, cool. You know, you actually can't escape from accountability after stealing $10 billion of, you know, dollars of money, no matter who you pay off. So it made me feel kind of good to actually see some accountability here. How about you? Is that why you're wearing your SpongeBob sweater, celebratory? Yeah, man. I mean, like, it's what I've been saying, you've got to be, happy and optimistic, even though we're at the bottom, because we're at the bottom. And so when somebody like SBF gets arrested, it's like, man, we are turning a new page. The seller that sold all of our tokens is in jail.

Starting point is 00:26:57 The seller is in jail. So that makes me happy. That's something worth being happy about. Like, look at that guy, just getting escorted into a car by a bunch of Bahamian policemen. That's where he was arrested, right? In the Bahamas. This is footage. Yeah, crazy that, like, he didn't.

Starting point is 00:27:13 Look at this. Look how many people they sent. Yeah. They sent a lot of policemen. What did they expect? I mean, this is like almost a dozen. At least in this one shot, yeah, from what we can tell. And so, okay, so here's what happened.

Starting point is 00:27:28 The Bahamian regulators, the Bahamian authorities, release a statement. On December 12th, the office of the Attorney General of the Bahamas is announcing the arrest by the Royal Bahamas Police Force of SBF, of FTX. SBF's arrest followed the receipt of formal notification from the United States that has filed criminal charges against SPF and is likely to request his extradition. So the United States has filed charges against Sam. And as a result of that, they have not yet requested his extradition, but you could only assume. And so because that he is being charged by the United States, the Bahaman police arrested him. Okay. So he's arrested. He's in jail in the Bahamas,

Starting point is 00:28:04 yet to be extradited. Is there like bail? Does he have the ability to make bail? Has he tried that? I mean, I know he has only 100,000 in his account. says, allegedly. But what's that looking like? Yeah, no bail for Mr. SBF. If he wanted to flee to a country that didn't have an extradition treaty with the United States, that window has officially closed. And so he will officially be judged inside the United States by a court. Unlike, by the way, Thero's Capital, who is in a country with no, with no extradition treaty. So SBF has been charged with wire fraud, wire fraud conspiracy, securities fraud, securities fraud, securities fraud, and money laundering.

Starting point is 00:28:46 That's a lot. That's a lot of things. That's a lot of things. So if you are interested, if you are tallying up the years for if he is guilty for all of those things, if he becomes guilty for all of those things, that is life. That's life in prison. Max charge. It's like something like 120 years or something like this.

Starting point is 00:29:04 Yeah. Yeah. So not life in prison, but 120 years. So the rest of his life. Yeah. That, of course, is Max charge, though, which is hardly ever happens. He's not yet guilty for those. Look, there's some.

Starting point is 00:29:14 discussion around this and I don't I don't know uh you one of the conspiracy theory is when he was arrested uh like the night he was arrested was that well he was supposed to appear in Congress the very next day so maybe this was some kind of block from him appearing in Congress he was going to testify in a in a hearing but he that was voluntary is there any substance to that do you think that there's still some shenanigans going on with like oh this is the way to get him out of testifying in front of Congress. That take doesn't make any sense. It's like a worst thing. Now he has to like swear under oath in a court of law about what happened rather than a

Starting point is 00:29:53 willing like and volunteer testimony. Like whatever. That take didn't make sense to me. There's another take which is like, oh, clearly Caroline ratted him out. Yeah. And has some sort of plea bargain. Now that that makes more sense to me, but I have no evidence that that's true. Do you have any thoughts on that? She was seen in New York blocks away from the Attorney General's office like two weeks ago. In like a Starbucks or a bakery or something. Yeah. And so then then

Starting point is 00:30:20 Crypto-Twitter deduced that that particular Starbucks or some bakery or whatever was just like eight blocks away from like the Attorney General's office. They're like yeah, picking up a croissant and ratting out her business partner. I mean remember like what at least one of these people is a complete psychopath and so at least.

Starting point is 00:30:38 And so when it comes time to not go to jail somebody is going to like burn their dilemma. Come on. Like we know we know what this is already. That makes perfect sense to me. And remind people, Caroline was the CEO of Alameda, right? Exactly. CEO of Alameda, yeah, allegedly SBF's short-term girlfriend and also fellow Adderall consumer. Not only is he being put in jail and under charge for the financial crimes you listed, but the CFTC has a bone to pick with him too. It's all kind of co-releasing on the same day. another set of charges from the Commodities Futures and Trading Commission. What is this? Yeah, they are suing Sam Begman-Fried, F-TX Trading, FtX.com, and Alameda Research against the CFTC for all for commodities fraud.

Starting point is 00:31:22 Yeah. So SDNY is also suing Sam Beakman-Fried. They had their indictment that was just unsealed the morning after they arrested him, charging Sam with four counts of wire fraud, two accounts of commodities fraud, one account of money laundering, and one count of campaign finance violation. Wow. Probably more than that. So eight total counts. Yeah, that guy is going to jail. Did you know, Ryan?

Starting point is 00:31:46 That apparently in the FTCS inner circles on Signal, there was a group chat called, that they had titled Wire Fraud, and they were using it to send secret information about operations in the lead up to the company's spectacular. Wait, a group chat between Sam, Caroline, and a bunch of other FTAX insiders. It was called Wirefraud.

Starting point is 00:32:07 As a ha ha funny joke? Exactly. Yes, they just titled the wire fraud, which is probably where they did the wire fraud. I mean, that's going to be obviously presented in court. It's like, this is a bunch of children. Your Honor, I didn't know. Look, okay, so here's the take. It's just, it really was a whole bunch of children, David.

Starting point is 00:32:26 It was a bunch of children. It was a bunch of children. It's so embarrassing. Some speculation that turned out not to be true. One piece of speculation so far anyways was that this guy's going to get away with it completely because he paid off the pot. politicians, and he bought the media institutions, and he bribed everyone, and so he'll never go to jail, right? That was one take. Well, my thought was just, like, we should wait a little bit.

Starting point is 00:32:47 We've waited a little bit, and now here he is in jail. So that doesn't seem to be playing out. The other take was that SBF, with his media tour, he's playing some kind of 40 chess, where he's trying to garner public support. He's trying to, like, gain sympathy. And this is why he went on Good Morning America and did that like Bloomberg. He showed up in a, you know, Wall Street Journalist, CNBC interview, like the week after. All of these things, it just wasn't making sense. So people were like, he's playing 4D chess. David, I think we can say at this point, this man was not playing 4D chest. He is a child. He's a kid. He got in way over his head. He had no idea what the F he was doing. And now he's in jail. And that is the, like,

Starting point is 00:33:31 the conclusion of that, in my opinion. I can't believe it, though, that, um, We let a child manage billions of, of, like, of crypto's capital. Like, we gave him all of these, like, I don't mean you and I, but like the industry writ large, we gave this child access to our private keys. What a massive mistake that turned out to be. Yeah. Whoops. Well, lesson learned.

Starting point is 00:33:56 And at least my faith in society and justice is restored. At least we are not as society totally completely corrupt. Although all of the, like, very sketchy, terrible investigative journalism that was done by mainstream media, I think we could go back and cast another eye on why the hell that happened, but at least our justice system was not duped by this fraud, which is the important thing. That is important as well. And so there are some hearings going on on Capitol Hill as well. Should we turn into this one from Representative Tom Emmer, who's been on the bankless podcast before? Yeah, let's hear what Tom.

Starting point is 00:34:35 member has to say. And Mr. Ray, I appreciate you mentioning your concerns in the beginning of my questioning about the concentration of power and a small group of individuals with no oversight. That is the exact problem that open and permissionless technology like crypto and blockchain solve. It solves for the problems of centralization. You stated in your testimony that you've never seen such a, quote, utter failure of corporate controls at every level of an organization, from the lack of financial statements to a complete failure. of any internal controls or governance whatsoever. Close quote.

Starting point is 00:35:10 FTX had disastrous or even non-existence systems for accounting, audit, cash management, cybersecurity, human resources, risk management, and other unacceptable management practices that currently make your job to uncover the facts quite difficult. Fortunately, the immutable characteristics of public blockchains that some people would care not to understand in this committee allowed the crypto community to reveal Sam Bankman-Feed's fraud,

Starting point is 00:35:40 and the on-chain public record will assist law enforcement moving forward. I encourage my colleagues to understand Sam Bankman-Feed's con for what it is. A failure of centralization, a failure of business ethics and a crime. It is not a failure of technology. I've worked across the aisle since I came to Congress, so the future of crypto reflects American value. the same way the internet does today. For the most engaged members of Congress on crypto policy,

Starting point is 00:36:11 the FTX collapse remind us of why we care so deeply about this technology. Decentralization is the point. Thank you. There we go. My God. Decentralization is the point. I'm pretty sure I remember a few of us tweeting that out during the middle of the bull market. Well, he's paying attention.

Starting point is 00:36:30 I mean, guys, remember Tom Emmer has been on the podcast. We've had this conversation with him, and this is him on California. Capitol Hill talking about it. That was the former CEO of FTX. Was that John Ray? Yeah. Who is kind of the witness on the stand there. All right, David, this is Tom Emmer again, this time on the SEC. You ready for this clip? Yeah. Oh my God. It's so good. We know that Chair Gensler had more meetings with FTX than anyone else in the crypto industry. We understand that what was being negotiated was a framework for digital asset exchange registration and token registration with the SEC that would benefit both parties.

Starting point is 00:37:07 It would expand the SEC's jurisdiction in exchange for the SEC's preferential treatment of FTX over other industry participants. We understand there was a lot of activity to move this idea forward, including the circulation of draft, short-form disclosures that would enable filers to get tokens listed on this newly formed bespoke exchange. Mr. Ray, I know you're handicapped with the information you currently have obtained. but Chair Gensler refuses to answer our questions or testify before this committee. Will you commit to sharing with this committee any internal documents you come across regarding communication between FTX and Mr. Gensler or others at the SEC? We'll fully cooperate with the committee and the regulatory authorities with respect to our investigation. Again, specifically, I just want copies that this committee will want copies of those communications

Starting point is 00:38:02 to the extent they exist. we can certainly work with your staff to get you what you have. Certainly work with your staff to get you what you need. God, what a hero. God damn. But man, is that so damning of Gary Gensler, a quid pro quo agreement with FTX to hand over the keys of crypto to the SEC

Starting point is 00:38:23 in exchange for preferential treatment and the ability for Sam to make his Sam coins, all of his like all of his portfolio basically. The thumbs up from Gary Gensler. Wow, that's not a good look. That is what I think if I was a lawyer, Ryan, I would call that a bad fact. That sounds like a bad fact. We'll see as the evidence comes out.

Starting point is 00:38:44 But if the evidence comes out and that proves to be the case, that is very damning, I think, for the SEC and Gensler in this case. This is a clip from Kevin O'Leary testifying at the Senate hearing. And I think you've called this, David. This clip might be actually the worst take of the year. One of the worst things I've heard this year. Should we play this? It's a tall mountain to, sorry. That is a, if this is, Ryan, the worst take of the year,

Starting point is 00:39:13 there's been a lot of bad takes this year. So let's let the listeners decide. Why do you believe FDX failed? I have an opinion. I don't have the records. Here it is. These two behemoths that own the unregulated market together and grew these incredible businesses in terms of growth.

Starting point is 00:39:32 That's Binance and FDX. other and one put the other out of business intentionally now maybe there's nothing wrong with that maybe there's nothing wrong with love and war but finance is a massive unregulated global monopoly now they put ftx out of business no they did not bro no they did not what what sam bangman freed put himself out of business. Look, Binance, who knows what Binance was doing,

Starting point is 00:40:07 but if SBF and FDX actually had the funds that they claimed to have, if they weren't playing around with depositors' money, a run on the bank wouldn't have been successful. How are you blaming that

Starting point is 00:40:20 on Binance and CZ? I don't understand that take, David. CZ was like, he wasn't the whistleblower, but you don't blame the guy who expresses public criticism that accidentally tipped over a massive

Starting point is 00:40:32 House of Cards. The crazy thing is is Kevin O'Leary was paid $15 million to be a public spokesperson, aka paid shill for FTX. Mr. O'Leary, I am going to inform you that FTX is not an institution anymore and SBF is in jail and you do not have to continue to fulfill your contract as the paid spokesperson. And you should probably... You can stop. That can be clawed back as well. Like you have no incentive to do this. I don't know why you're... trying to ruin your reputation in front of all of America in front of the U.S. Senate by saying these ludicrous things. Absolutely insane.

Starting point is 00:41:10 David, but let's all just take some, like, let's all take some personal accountability. No one forced Sam Bankman freed to steal depositors' funds. Right. No one forced him to do that. That wasn't like some competitor playing dirty games. This is all Sam. It's all Sam. And probably a few others who definitely enabled him to really,

Starting point is 00:41:32 wrap this up. I want to bring up this tweet from Anthony Cisano who tweeted out, SBF down. Suzu, Kyle Davies, and Doquan are hopefully next. I think this is the year of hopefully, the reckoning, right? Like scammers infiltrated our industry in the last bowl market. Suzu and Kyle Davies definitely committed fraud. Doquan, I mean, algorithmic stable coin, he didn't know. He definitely kind of knew.

Starting point is 00:42:00 but like man like let's get these people charged and in jail please we live in a society yeah crypto definitely has to take out the trash a little bit and we have to have a purge we have to be introspective about how this happened uh david on his way out his parting gift and i hope this is the last thing he leaves us it turned out we found out last Friday that sbf secretly funded the crypto news site the block media institution. The way he did that was pretty shady. Do you want to explain? Yeah. So the news here is that the CEO of the block, Michael McCaffrey, resigned after failing to disclose $43 million of loans from FTX to the block. These loans were apparently kept secret

Starting point is 00:42:46 from the employees as McCaffee was the only member on the board of the block. One $16 million batch of funding from Alameda was used in part to finance the purchasing of an apartment in the Bahamas, one of those Bahamian real estates for the block CEO Mike McCaffey. He has, again, since a step down, Morin, the chief I think revenue officer, finance officer of the block, has taken over McCaffey's role as CEO and will look to restructure the block to buy out McCaffey's stake in the company. This was crazy to me, Ryan. The company, the block, isn't profitable. And I previously raised over $4 million to support the company. It's revenue mostly from ads and subscriptions. is expected to be about $20 million this year, a source told Axio, who we are reporting with right now.

Starting point is 00:43:33 And so a couple quotes from people that worked at the block. Mike never asked me or anyone in research to cover FTX or SBF in any particular way, or anyone else for that matter. We had a complete discretion in our job. So this is Larry Sermak out of the block, who's very well respected in the cryptosheres. Additionally, another editor-in-chief, Sarah Kopit said, I'm proud of the work our journalists have done, especially covering the follow of the XPX implosion.

Starting point is 00:44:01 And then continues in saying, in my time, Mike has never had any undue influence on the newsroom. We've always been completely independent. Frank Shapiro, who is head of news at the block, I believe, also had some public statements. Basically, SBF secretly bought the block

Starting point is 00:44:18 and did a deal with the CEO, bought him a... Brived him, basically. And then the employees of the block said that they all, no one knew any of this. Yeah, that's the news. Yeah, that's the news. I do feel bad.

Starting point is 00:44:34 I know there are people of integrity at the block. I feel bad for them. I'm sure they were caught by surprise by this. And that has to be absolutely devastating. So, I mean, that's terrible. It's bad for the industry. I mean, what was Sam planning to do with this crypto media institution

Starting point is 00:44:49 that he kind of shadow owned through shell companies and through the block CEO? You know it was for a, purpose. You know there had to be some return on that investment in the form of good press because that's what he was up to in traditional media. And to see that corruption take hold in crypto media, you know, it was, when I heard about this, David, I was like, it almost brought me down to those November lows when I was like just really upset about this whole thing.

Starting point is 00:45:17 Because for so long, we've been talking about, hey, traditional media is not covering crypto the way needs to be covered. Let's go crypto media. Crypto Media. That's an answer to this. And that's the flag that Bankless is carrying, like defiance and Blockworks and some others. And then here we are, one of the Crypto Media publications just have corruption from the inside out. And yeah, it's very unfortunate. I hope they get over this. I hope the good people at the block are able to kind of forge past this and rebuild. But yeah, it's pretty unfortunate. Yeah, yeah, quite. I do know that, like, Larry, Stephen, Frank, they all, I've always thought that they were upstanding individuals on net. Some of the conversations in the space where are like, yes, they're great investigative journalists. They're great at being impartial. But on net, like the block, the people at the block all did seem to, these are not my words, simp for Sam and the SBF coins. And like Mike Dutis, former owner of the block, big Salonable. So there's like a line.

Starting point is 00:46:24 with that now like kind of axis the sam coins ftx axis that like even though they appeared to be very like forthcoming and um um impartial ethical they also were like in that axis of of crypto that was aligned with sam and so there's like we don't really know any of the details it's just hard to know it's it's very hard to know yeah and who knew what like it's kind of crazy like people like people like people know about like the financials of a company like how how how where do they think the money came from? Like, why were any questions? I don't know. I just has, I just don't know. That's the thing. No one else. I will say one thing that, David, my kind of circle of trust has definitely contracted in crypto from what it used to be. Like, I mean, you crypto has always

Starting point is 00:47:08 had this thing. It's like, verify, don't trust, right? And I've always kind of lived by that. But like, as you get to know people, as you kind of meet these institutions, you start to trust more and more people. That circle of trust has like definitely decreased by a lot here lately for me personally. And yeah, so I don't know, we'll just have to let long-term reputation speak for themselves, and that'll be the true test. It's the Lindy effect. So the Block CEO has resigned. All right, what else we got? We've got- So, Binance, the Binance Bank Run. Okay, so the Justice Department, Ryan, has turned their eyes over to Binance and apparently are weighing the charges against Binance and its executives,

Starting point is 00:47:48 whether or not they should charge them with stuff. And has this precipitated a bank run? because these charges are going in the press, and so people are like, uh-oh, Binance is the next to fall, and so they're starting, like, massive withdrawals from Binance? Perhaps, yeah. So, U.S. Department continuing to weigh up charges

Starting point is 00:48:06 against crypto exchange giant finance for possible money laundering and criminal sanctions violations according to Reuters. And so as a result of this, and I mean, see, I don't know if you've been following CZ lately doing a lot of the whole main character thing.

Starting point is 00:48:19 And so as a result of that, there have been an all-time high outflow of out of Binance. Here's Nick Carter who also tweeted out. I'm not the arbiter of proof of reserves or anything, but I also find Binance's proof of reserves a bit questionable writing an article soon. And so there was an article out about Binance's proof of reserves.

Starting point is 00:48:40 And the headline of this article is, Binance's alleged crypto audit failed, not even its auditor would vouch for it. And the subtitle is, Binance says an audit shows proof of reserves of customer funds, but its auditor will not vouch for the reserves, nor the methodology demanded by Binance. So this has, you know, people,

Starting point is 00:48:57 their very recent memory about the insolvency of exchange. And so as a result of this, there is the largest outflows out of Binance. 40,000 Bitcoin has flowed out of Binance in the last 24 hours this week or so. And then, but also Ryan, important to note that the remaining balance on Binance is 580,000 bitcoins. So 40,000 outflows, not that crazy. $2.2.2 billion of stable coins

Starting point is 00:49:23 outflowed out of Binance. The remaining balance is $20 billion. So while there are all-time highs of stable coin outflows, there are $20 billion of stable coins reportedly left in Binance. And so people are doing the whole bankless thing, which is great. But, I mean, if this is a run on the bank,

Starting point is 00:49:41 it's a pretty weak one. Well, like, first of all, if it's a run on the bank and Binance has all of the deposits, nothing to worry about. There's no such thing as a run on the bank it's fully reserved. You only have to worry about run on the banks when it's a fractional system and Binance says they're not fractional. But can you trust them? Can you trust any bank? What we say is if crypto bin, now your key is not your coin, use an exchange, then get out. That's how you

Starting point is 00:50:02 should be using these crypto exchanges. But then when you zoom out, and this is, this is Nick Carter's tweet again. This is a bank run at Binance that you're all hyperventilating about. Like, look at the numbers here. It's kind of like barely a blip. It's a blip. There's not really a Binance bank run. That's kind of the thing. It's like kind of, overplayed, like just Bitcoin reserves are down, but they're down to like May levels, David. It's, it's in finance reserves are almost at all time highs. Heath reserves are down to July numbers, maybe. I don't know. I mean, this is not really a thing. I think it's much ado about nothing. But like, so far anyway, but look, I, that's the thing.

Starting point is 00:50:44 But do we know that those are the reserves? We don't actually know. Are those, is that on-chain data? I don't know if that's on-chain data or not. Yeah, I don't know for sure. So can you trust Binance? I mean, go bankless. Can you trust any crypto exchange? Just go bankless. Use these exchanges for what they're good for.

Starting point is 00:51:01 Don't ask the question. Just withdraw. Yeah, just go bankless. But also, I do feel like there's some scrutiny here that is maybe just like, you know, the nation state eye of so on saying, oh, we missed FDA, better not miss these guys. And what? Oh, they're a foreign company. They don't have public financials.

Starting point is 00:51:18 they're non-US, US, they must be shady, don't like them. And so maybe there's some of that reaction going on too. So it's hard to know at this stage, but we'll see. Hard to know. All right. Well, that was all of the SBF exchange drama, all that stuff. That's over. Coming up next, Metamask lands a huge partnership. We'll talk about that. And there is a lawsuit, Ryan. I don't know if you caught this week. A lawsuit against basically every celebrity who owns a board ape. It's not looking good. And then we cut the three arrows capital redemption arc. but it's coming to an end. I'm having none of it.

Starting point is 00:51:51 And of course, Donald Trump launches an NFT collection. So I'm sure the listener is going to stay tuned for all of that right after we talk to some of these fantastic sponsors to help us go bankless. Sequence is the all-in-one developer platform you need to build Web3 games and applications. For your users, Sequence is a smart wallet and it's the easiest, most intuitive onboarding

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Starting point is 00:53:52 This is MetaMask tweeting out. Our U.S. users will now be able to fund their wallet with ETH via who? PayPal. PayPal. Rolling out in the U.S. in the next few weeks. PayPal plus Metamask, a combination I didn't think would happen to like 2025 or beyond. It's now available. So you can get Eith in your MetaMask wallet.

Starting point is 00:54:11 Is that what this means? That's exactly what this means. And so I'm just loving how. direct this flow of funds is. So PayPal, which hooks into your bank account and then hooks into your Metamask address. And doesn't have to be your Metamask address. It can be your ledger inside of Metamask. So you can go from bank account to your ledger via the partnership between Metamask and PayPal. The previous Metamask onboarding, like on-Ramps have been like our crypto-natives, like MoonPay, like wire. I mean, it's hard to beat PayPal. I've always been

Starting point is 00:54:42 frustrated by like how small that pipeline is from funds into through Metamask credit card fees inside of Metamask were like 2.5% it's expensive if you're doing anything involved right that pipe was super constricted now with a PayPal partnership inside of MetaMask that that flow of is just way bigger yeah and look you can skip you can skip the FDX in the middle you don't even have to like you just go from your bank directly to Metamask that's a great thing for Fiat on ramp into Defi um David this is cool too yesterday was officially decided kind of the ether governance world that EIP 484, which is proto-dank sharding, which just to remind you, scales layer twos on Ethereum absolutely massively. What is this like a 10x gain or is this like a 10x gain is like

Starting point is 00:55:24 10x gain. It's really, it can be as high as 100x depending on how. 10 to 100x gain. And so it was decided that EIP 4844 will be included in Ethereum. That's official. Now, that's not the next Ethereum hard fork, right? I think the next hard fork is probably still just going to be withdrawals. Yes. which is good. We need that. But this could be a hard fork coming this year that we get EIP 4844.

Starting point is 00:55:46 I think more work needs to be done so there's no official timeline yet, but that's the possibility. Well, there's never any official timeline because that's how we live our lives in Ethereum. But it is Liam, who's privy to these conversations,

Starting point is 00:55:58 Liam Hornet at optimism, he says it will be in a fast follow hard fork after Shanghai. So no specific dates, but the roadmap is a fast follow. Yes, as Gandalf says, A wizard is never late. Exactly.

Starting point is 00:56:14 He arrives precisely on time, so does Ethereum updates. What's this, David? We're looking at. Just more layer two stuff. Optimism has all time high in transactions yet again. Oh, God, that is just great. The layer twos have been in a bull market, a transactional bull market, ever since their existence.

Starting point is 00:56:30 Did you know? Is anyone talking about it? Bankless is talking about it? Yes. Arbitrum and optimism, when you add their transactions together, you almost get an equivalent amount of transaction volume as the Ethereum main chain itself. And that is just those two layer twos. When you add in the rest of them, all the network of layer two is on top of the theorem,

Starting point is 00:56:47 you automatically, you definitely get beyond Ethereum layer one in transactional volume. Layer twos are just absolutely crushing it. There's always a bullet market somewhere, like I like to say. Yes, Vitalik said something similar to in our conversation with him about bullishness on layer too is it's coming out Monday. David, you were really excited about this this FI-L application. What is FI. Yeah, so FI, underscore XYZ on Twitter or FI land is announcing that the main net is here. So what is FI? It is like an evolution on D-GEN score. So what is D-GEN score? You would load up your wallet. It would give you a number, which would like

Starting point is 00:57:25 give you a resume. It's like, what did you go, like what food farms did you wape into? Like, it's like a resume. Like how much did you do on Ethereum? I remember, remember, I think talking to Van Spencer, actually, he was like, yeah, somebody, some applicant came into framework offices and applied for a job and he showed us like a Dgen score of like four. Lower is better, by the way. That means you're the fourth most Dgen person on Ethereum. And we hired him instantly. Anyways. So for on chain resume, people. Yes, it's on chain resume. Okay. So FI is a digital landscape. It's like an eight by eight grid, but I'm sure you can make it bigger. And because of what your Ethereum address has done that you load up into FI, you can, um, you can, um,

Starting point is 00:58:04 claim little units of land. And so because I've traded on uniswap, I have a little uniswap trophy. Because I've traded a lot on uniswap. I have a big Chad uniswap trophy. Do you really? Can I see yours? Yeah.

Starting point is 00:58:17 Okay, so you can see the one that I have at David Hoffman. I'm not showing the one that is on my secret wallet. Is it awesome? It's awesome. I know you really want to show that, though. Yeah, I know. And so like the gas truck on the bottom right,

Starting point is 00:58:30 the two by one gas truck. This is mine. This is my default. Web3 traffic. Yeah. So I've used optimism. I've used uniswap. Some of these are free

Starting point is 00:58:38 just to populate the land. That gas truck on the bottom right, I got by spending more than one eth on gas. The open sea ship... That's not something to be proud of, David. That's a waste... You're wasting your eth. You're spending it.

Starting point is 00:58:50 You should be saving it. Sorry, brother. I've got to buy the NFTs. The open sea, the ship in the top left. I got that one for buying, like, I think, five NFTs on open C. This is awesome. So it's a place of the way to visually

Starting point is 00:59:04 showcase your on-chain activity. It's like your on-chain footprint. This is cool. And these look like chess pieces here. These are just actually called chess pieces. Yeah. They're called chess pieces. This is awesome. So how did you get this like bank vault? That one's a freebie. That one's just a free to populate your land. Yeah. That's the highest one. Is that like a dog on top of this building? This is really fun. Yeah, it's super cute. The designer, if you're, if people are familiar with the nouns ecosystem, one of the same artists behind Nounstow. And so it was like one of the first times, like, I've had fun on Ethereum in a really long time. And this also plays into one of the things that we're talking about with Fitalik on the show is like identity.

Starting point is 00:59:42 This is an identity application. Yeah. This is what identity looks like when you separate it from the Social Security number. Yeah, exactly. Yeah, this is my identity. So it's cool. No customer deposits, no yield, just like a playing on a fun little, cute little landscape. I thought it was pretty fun.

Starting point is 00:59:58 That's pretty cool. We have a disclosure here too. David. Yes, we do have a disclosure. Both Ryan and I are investors in FI. And so, yeah. Now, proud investor, you know, that's a great app. Nice job, team. That's really cool. What about this? Defi's central bank. That's what they call Maker Dow these days. Not quite a central bank. Whatever. They relaunched their 1% fixed yield for die holders. People are like, just 1%. I'm like 1%. But like, you know, what more do you want? All the 8% yield we had is gone. It's gone in the smoke. That's pretty darn expensive from a risk return.

Starting point is 01:00:30 perspective. This is back to old times, I guess. Dye used to have an interest rate. Now it does again. Yeah. And it's also important that that one percent is not being paid for by somebody else that is being paid for by the protocol. Oh, no Ponzi? No Ponzi. No Ponzi. Yes. Back to fundamentals. You got to love it. Is that why it's only 1%. Yes. Because it's sustainable. Yeah. So long-term, DeFi, Ethereum veterans will remember the Dye savings rate, which got turned off as soon as interest rates in inside of crypto went to zero. Do you remember how do you see that baby was back in 2018? Yeah, it was like seven or eight percent.

Starting point is 01:01:05 Yeah, because, yeah, die was trading below a peg for so long. It traded down to like 94 cents or something. Anyways, the die savings rate is back. You can get a risk-free 1%. And when I say risk-free, I mean no counterparty risk. There's other risks out there like smart contract risk. Protocol risk. But in the same way that ETH staking is,

Starting point is 01:01:26 risk-free. MakerDAO's die savings rate is also risk-free, and that die-savings rate is up to 1%. Anyways, moving on. Tweet out of Sazel that I thought was really, really cool. It was talking about the, you know how interest rates are turning over, Ryan? Like starting to peak? Daily OFAC-compliant blocks are also turning over. Wow. I was told that would go to 100% and never change. Yeah. Well, so the non-O-FAC compliant blocks are on the up, and Sazil puts out his little analysis as to why that's the case. And it's because of someone we need. so many of the things that just made me not really worry about censorship in the first place. FlashBots open sourcing their relay and builder infrastructure, more non-censoring relayers coming

Starting point is 01:02:06 online, relators accepting submissions from external builders, and then also people using FlashBot's new innovation min-bid to O-FAC compliance. David? Never been a real thing in Ethereum. Do you know who's not worried about O-FAC compliance at all in Ethereum? Justin Drake. Oh, yeah. How do I know that?

Starting point is 01:02:25 Bankless Bulls episode with Justin Drake, Anthony Sissano and DC Investor that comes out the 26th. Let me tell you guys, it's bullish. It's very bullish. If you thought we were going to quit recording, putting a podcast during the holidays, you thought wrong. I'm only getting more bullish. Bankless don't stop.

Starting point is 01:02:43 David, big news here. Big news. The biggest news. Of course, on truth social.com, this is a Donald Trump official announcement that he is getting into the NFT. market. A good time to get in, I think, when the market's down, David, but he is rolling up a Trump Digital Trading Card collection. Yeah, Trump cards. Collect your Trump cards here for the

Starting point is 01:03:06 low, low price of $99 per card. God, this... Buy it by a credit card. This looks very... This is so perfectly built for Trump's base. This looks very, very sweepstakes bonuses. Yeah, it's... You got it all here. I actually... I saw this. If somebody sent me this, like, NFT, it's like, hey, do, should I buy this NFT? I'd be like, no, this is a scam, bro. This is a scam. To each their own. He's pulling some leaps out of Gary V's book.

Starting point is 01:03:37 So if you, there are certain NFTs that you could buy, uh, Miami dinner with Donald Trump. Spend a memorable evening in Miami for an exclusive dinner hosted by Trump. Or you could get the Mar-a-Lago cocktail hour, which is an NFT of Trump in a spacesuit, experience and meet and greet with Trump in his luxurious. private Palm Beach resort. Play golf with Trump and your friends. Join Donald on the green for an exclusive one hour of golf with your two closest friends. Wow.

Starting point is 01:04:05 Wow. I want the NFT that makes it so he doesn't run for president again. I don't think that NFT exists. I just love how all of these NFTs, like most of them, have Donald Trump in an extremely heroic outfit and pose. This is influencer NFT world. Do you know, okay, so this is deployed. because I read the FAQs on, what is it?

Starting point is 01:04:28 Which chain is it? Polygon. Polygon. You know, I'm just surprised it took Trump so long. Honestly, like, yeah, he kind of feel like late to the game, but, you know, to each their own. Trump NFTs are here. You can buy them, of course.

Starting point is 01:04:42 He did not get the digital collectible memo. He is still branding these things as NFTs. He did not get the rebrand. Yeah, he forgot to rebrand. Trump's still bullish NFTs. Yeah, still bullish on NFTs. I don't know. All right, we got this.

Starting point is 01:04:56 This is a story you want to dig into. Celebrity promoters sued over board ape NFT endorsements. What is going on here? So we were always suspicious that these celebrities weren't intrinsically bullish on board apes. It was much more likely that they were given a board ape and then they were able to talk about it in pop culture. Turns out it gets even more shady than that. Very much more shady. So this particular suit names Jimmy Fallon, Gwyneth Paltrow,

Starting point is 01:05:24 Justin Bieber, Madonna, Kevin Hart, Stephen Curry, Snoop Dog, Serena Williams, Post Malone, The Weekend, and Fallon's production company Electric Hot Dog, and Universal TV. Those are the defendants. This is who is being named in the suit and claims that most of them were recruited by talent manager Guy Osseri, who spearheaded a scheme with Yuga Labs to discreetly pay them for their endorsements through crypto firm Moon Pay. So Guy Osseri, he's a talent in Hollywood, talent manager for like many of the people I just listed, also Madonna and U2, and Osiri is allegedly linked to several of the celebrity promoters through their early investments in Moon Pay. So by increasing the demand for Board Apes, Yag Clubs, NFTs, and Yuga Labs

Starting point is 01:06:10 Ape coin crypto token, the suit alleges that they also increased demand for Moonpay. So there is just this incestuous network of Yuga Labs, Moonpay, and all of these celebrities. Like, Hey, Moon Pay, we're going to give celebrities board apes, and then we're also going to do that through your payment services. And so we're going to pay celebrities for that through Moonpay to induce demand for Moonpay. We'll talk about Moon Pay. And so quote from this article,

Starting point is 01:06:36 Osiri, the Moon Pay defendants, and the promoter defendants, each shared strong motive to use their influence to artificially create demand for the Yuga Securities, which in turn would increase use of MoonPay's crypto payment service. Wait, the Yuga Securities? They're calling them securities, yeah. Why would it? Like the NFTs are security?

Starting point is 01:06:51 Yes, yes, exactly. Yeah. Well, Ucala Labs is being, being, I'm on board with that one. Like, it's kind of hard to argue that they're not. NFTs? You're on board with, wait, you're on board apes being securities, David? Because, well, it's kind of hard to defend that they're not when they have the whole entire board ape ecosystem and the board ape is like an ownership stake over the board ape metaverse. Yeah, it doesn't look good. I wouldn't want to be the lawyer having to defend that one. I understand the like the ownership property, but like how an, like, why is a board ape different than an axi, for example, an axi infinity or a collectible like a sword? Like, you know, Gensler wants to make everything a security, right, David? Yes, it's because, like, the Yuga Labs is making this board ape ecosystem, this board ape universe. And so it's very claimable that as Yuga Labs, a centralized party, the efforts of this centralized party is going to increase the value of a board ape, whether or not they can execute on making the board eight metaverse or not.

Starting point is 01:07:51 That is kind of a security. But Gary would make that claim about ETH too, and he would call that a security. Well, then we get into the nature of client teams. Like, client teams are different than Yuga Labs. I don't know. I think this one is, again, all I'm saying is I would not want to be the lawyer who has to defend it.

Starting point is 01:08:10 That's not true. Anyways, I want to go back to the story. And so, at the same time, Osir could use Moonpay to obscure how he paid his off his celebrity cohorts for their direct or off-label promotions of the Yuga financial products. In an episode of The Tonight Show on November 11th, 2021, Fallon promoted Moon Pay and the BoredApe NFT collection by announcing that he got his first NFT through the crypto firm, which bills itself as a white glove service designed to help celebrities buy digital assets. He did not disclose that he had a financial stake in MoonPay. To me, that's the big piece, honestly, is the disclosure

Starting point is 01:08:43 you have to disclose, right? Promotions are one thing, but like you have to separate what's a promotion and what's not. And when you were paid and what's not, I think that's the first thing. Whether this thing's a security or not, that's a bridge too far for me. That's not, that's not what the story. Personally. That's not what the story is. But you also like look at the net effect of this. What were the brands of board apes? Like the board ape community holders? Like why do I have this like anti-board ape resistance? It's because the board apes are known to like lose their private keys and get fished all the time because they're normies. And so if we with the, sorry to all the proud board ape holders. That's kind of the brand of a board ape holder. And so all of these celebrities are

Starting point is 01:09:21 promoting board apes to like their like, you know, mainstream normie audience. But isn't that what we want? Like mainstream adoption? That's what we want though, David. I mean, I'll push back on that too. Not through, not through secret paid shills. Not through that. A hundred percent guarantee. And so like it onboarded a cohort of people who weren't ready to go bankless and then they paid a ton of money for their board apes and then they got fished because they like the connections between the novice nature of board ape holders and the fact that there was a ton of celebrity endorsements, that connection is really strong for me. Yeah, that's interesting.

Starting point is 01:09:55 I'll have to let this one sit, but I do. The thing that is very clear to me is there needs to be a complete transparency around what is provided as promotional and what's not. It very much seemed like when I watched the Fallon show that like Fallon was like, I'm bullish NFTs and I've been board ape-pilled and I bought this thing. And like, if there was some knowledge or disclosure that there was a payment for that, that it was actually a sponsorship. Right.

Starting point is 01:10:25 Then I'm bullish board apes. Sponsored by board apes. Yeah, exactly. That's the thing that sticks out to me. Speaking of promotion, bankless NFTs are here. So we've been going through the Genesis collection. We originally minted the SBF versus Eric Voorhees episode. And then we did the Crypto Renaissance.

Starting point is 01:10:44 And then last week, we did the owner. ownership economy with Legion. And so there's five Genesis collections. Three of them have been released. They have all sold out inside of four blocks. And the fourth of fifth is going live today. This is bankless promoting our own NFTs. So disclaimer. Disclamor. These are, yeah. And actually, so I got my first one last time, David. I actually got me actually into the Legion. And the next one has also been released. It is one of my favorite episodes of all time. Ultra sound money with Justin Drake. With Justin Drake. So that is happening. And 10% of the proceeds go to wherever Justin Drake wants. I forget, who did he select? To ultrasound.eath. And so 10% of the

Starting point is 01:11:29 revenue and the royalties is going to help the-Utrustound.money. Is that right? The address is ultrasound.eath. And then that goes to the ultrasound.money website. So if you buy the Justin Drake Ultrasound Money podcast, collectible, 10% of the royalties and mint revenue goes to pay for the development of ultrasound.money. My friends, this website will sustain us all through the bare market. Do not worry. This website is eternally bullish.

Starting point is 01:11:55 That link is collectibles. dot banklist.com. I believe the mint goes live. No, noon east. No, noon east. East coast. No, noon eastern. Yep.

Starting point is 01:12:04 E-S-D. All right. We got some more bad boys to tie off before this whole. SBF thing is over. So where are Kyle Davies? and Suzu hanging out these days. I think I need a membership to look at this article, but vaporized one trillion was the title in the New Yorker, I believe, New York Magazine, rather. Where are Kyle Davies and Suzu hanging out, David? They're probably, I think, in Dubai. They're in

Starting point is 01:12:29 Dubai. So some of the parts of this article, I think, are entertaining, I will say. And so I'll read off parts of this article. Her, as in Her, the Boat. would-be captains showed off pictures of the $50 million vessels at parties, bragging that it would be, quote, bigger than all of the richest billionaires yachts in Singapore, and described plans to adorn the staterooms with projector screens, creating a waterborne gallery for their growing collection of digital art in the form of NFTs. Wow.

Starting point is 01:13:02 Is that not the most topy, top signal of all time? This super yacht was the largest by well-established boat builder San Lorenzo ever sold in Asia, a triumph of crypto Nouveau's Reach. I don't know, Nouveau Reach. Crypto's Nouveau Reach. That's like the new rich. Cool. Sick.

Starting point is 01:13:22 It represents the beginning of a fascinating journey. The name of the buyers had in mind was cleverly chosen, an inside joke nodding to the cryptocurrency doge coin that would both thrill their social media acolytes and would be intelligible to all the pathetic port no corners out there. The name of the boat, of course, much wow. That's actually not a crypto meme. That's just the normal Doge meme, but no, whatever. Yeah, they co-opted it.

Starting point is 01:13:45 Yep. Okay, last paragraph. Her buyers, again, her, the boat, Susu and Kyle Davies, two Andover graduates who ran a Singapore-based hedge fund called Three Roos Capital, never got the chance to spray champagne across much Wows' Bow. Instead, in July, the same month the boat was set to launch, the duo filed for bankruptcy and disappeared before making their final payment,

Starting point is 01:14:05 marooning the unclaimed trophy in her breath in Les Hesbia on the Italian coast. and I want to just pull out two quotes from an article that Suzu and Kyle Davies said, because they, Ryan, if you have been watching them on Twitter, were trying to go through some sort of redemption arc with SBF. As soon as SBF was being dragged through the coals on crypto Twitter, Suzu and Kyle Davies came out of hiding on Twitter and started also trying to drag SBF through the coals. And then crypto Twitter was absolutely having none of it.

Starting point is 01:14:36 It's like, wait, no, you guys are criminals too. We haven't forgotten. Yeah, we know who you are. A few months, guys. And so two quotes that they have both tweeted out or put into an article. Su-Zoo, it's a long story, but we were scammed just like you guys. That is a quote from Suzu. And then also, Kyle Davies, we understand that FTCS hunted our positions, taking absolutely no responsibility whatsoever saying it was same.

Starting point is 01:15:06 Gross. We just got screwed just like you guys. We're just a bunch of normies, just like you guys who got axed by SBF. Absolutely insane. Absolutely insane. This is Nick Carter's take calling Suzu and Kyle Davies carbon copies of FTX. Yeah. Because that's exactly, excuse me, of SBF.

Starting point is 01:15:26 Because what were they doing? They are refusing to talk to liquidators, but also doing a press tour on crypto Twitter trying to, like, restore them. Carbon copies of SBF, mini SBF. Well, SBF's in jail. So I don't know what the next destination is. But it does seem like Doquan is in Serbia right now. So not in South Korea. Every time I've seen him tweet, I haven't looked in a while, but the past few months,

Starting point is 01:15:53 he says, like, I'm fine. I'm right here. Like, you know, if the authorities want to come, talk to me, I'm right here. I'm just in my house. Reports that he is in Serbia. That's the country that's harder to extradite from. I'm sure if you're in South Korea. Yes, yes.

Starting point is 01:16:08 In Serbia, which, you know, kind of formerly a gulog, so it's not like a nice place to be, also wanted by Interpol. Wow. Well, there we go. This is the bad boys on the run. Something else that floated by my desk this week was a bill by Senator Elizabeth Warren and Senator Marshall. This is a Republican Democrat combo.

Starting point is 01:16:26 It's probably the most significant attack on digital freedom I've ever seen. One of the things this bill does, it's anti-crypto bill. it turns validators into money services business. Opt be AML KYC, register, and all the state register, all of the different places you need to register financially. It completely outright, David, bans financial privacy. So, you know, that whole tornado cash thing?

Starting point is 01:16:49 It's like if you on-chain privacy, mixers, all of it, it's explicitly named. No can do. By the way, they get the level of detail right here. Like, look at this in this money service. They're talking about MEV searchers. They use that term. in the draft bill, validators, other independent network participants.

Starting point is 01:17:09 They know exactly what they're targeting. That's a 400-level term. Totally. I mean, they probably listen to bank lists in order to craft a bill like this. And what this does is it turns America into a full-on surveillance state. So my comment here in the tweet was, this is how Western democracies die. I really feel strongly that if we institute this type of bill, like, we're goners. We're going the way of like other surveillance countries, authoritative.

Starting point is 01:17:34 countries, like the way of China, that sort of thing. Now, what's interesting about this kind of bill is because, like, I'm not in Capitol Hill. Does this bill actually have a chance? And I think that's where the second order analysis really comes into this. And so, you know, we tweeted about it back and forth, including inviting Elizabeth Warren on the Bankless podcast. And by the way, anyone from Elizabeth's office, you guys are listening right now, we'd love to talk to Senator Warren about this bill and about crypto. We're not shadowy supercoters. like this is David in a subway photo. This guy does not look like a criminal to me.

Starting point is 01:18:07 We're friendly. We're happy to have a debate or a conversation or anything else you'd like. But the question to Jake Trevinsky is, is this bill like really a thing? Or like, what is this? And he says, no, it has no chance whatsoever on Capitol Hill. He says, and I quote,

Starting point is 01:18:26 this is sort of her thing talking to Elizabeth Warren, exploiting unrelated news to make headlines with crypto crackdown bills, each one more extreme than the last one, to keep the outrage machine humming. For example, earlier this year, Russia invades Ukraine. Let's ban crypto. So that's the thing. I mean, like... Crypto, the thing that put body armor on Ukrainian citizens. Yeah. At first. At some level, I felt like I needed to respond to this, right? We need to take a stand and just like... But at another level, it's kind of playing into her game, which... is interesting. It's like turning, our politicians have turned into influencer clout chasers, haven't they? Fortunately, this bill, Courtney and Jake, does not have a chance whatsoever. So it's not a real threat, but this kind of posturing is, I think, a threat. Anyway, don't have to be worried about this bill specifically, but we have to be ever vigilant, I think, against these sorts of things. I have no idea why a senator would think this is a good idea or is at all, why it would have anything to do with American values. But, yeah, that's

Starting point is 01:19:28 take. Yeah, I wonder how many just wasted man hours went into producing this bill so Elizabeth Warren could just wave it around, but I don't really want to explore that question anymore. Well, let's explore some raises this week. Block Native, they raised $15 million. Block Native is one of those, I guess, not MEP researchers. It provides the data to MEP searchers. Block Native is like the pre-chain layer, the MMPL infrastructure. If you're an MEP searcher or a block builder, you would probably tap into Block Native. Still getting funded. And here's another thing,

Starting point is 01:19:59 Mr. Warren wants to, Senator Warren wants to ban, which is on-chain privacy. What's this, David? Yeah, ASSEC raises $100 million to build an encrypted Ethereum. So ASSEC is like a private layer two, it is a ZK-ZK roll-up that is two layers of ZK to allow you to have scale and privacy.

Starting point is 01:20:17 So it's like a VPN. You put your money in Aztec, and then ASSEC goes in yield farm on the layer one on your behalf. So it's like a private VPN for Ethereum. Pretty cool. You know a way to describe this is, Cryptid Ethereum is another way to describe this. And disclaimer, both BlockNative and Aztec, Ryan and I are investors in.

Starting point is 01:20:35 Yeah, we're excited. Also, jobs, guys, it's our weekly time to remind you that there are still jobs in crypto. It's a great place to be during the build market. Alchemy is hiring a back-end engineer. Uniswap is hiring a senior front-end engineer. A diagram ventures needs an associate for crypto venture creation. Rabbit Hole needs business ops and strategy lead.

Starting point is 01:20:55 Diagram needs a senior principal, again, for crypto venture creation. MakerDAO is hiring legal counsel. You guys can find all of that at the bankless.pallet.com job site. David, what do we have coming up next? Coming up next, we got some hot takes out of crypto Twitter, which are nice and hot this week. And then Ryan and I got what we are bullish on moving forward into 2020, 2020.

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Starting point is 01:23:24 What a crazy thought. What a crazy thought. Look, the way out, the way forward has been in front of us the whole time. It's like, Defi hasn't been tried and found failing. It's been like not tried fully. We have the answer. It's called Defi. This is proof of reserves built in.

Starting point is 01:23:41 And so pretty bullish that we'll be able to rebuild on that kind of a foundation moving forward. Here's a take from Van Spencer. David, read it out. Yeah, Van Spencer says, really feel like there's a lot of innovation happening in Defi right now. And then he follows and says, people are asking for examples. So he gives them. Payment for order flow protocols.

Starting point is 01:23:59 That's something like... MEV stuff. MEV stuff. Yes. Manifold finance is what he might be referring to there. Liquid staking hockey stick growth. NFT royalty experimentation. Regionalized slash verticalized defy.

Starting point is 01:24:12 Layer two defy ecosystems, low latency use cases, and better front ends and wallets. So these are the things that Vance has identified as getting a bunch of development right now. I'm super excited about the better front ends in wallets coming. I think that's going to make onboarding a lot easier. Account, abstraction, smart contract wallets. Please, please, please, please, I want. A hundred percent. What about this?

Starting point is 01:24:32 Take from Fubar saying, crypto-U-X is too complicated in sarcasm quotes, I think, and he's got a picture of what? You know, where you place in your credit card. So name on card, credit card number, CCV code, expiration date, billing zip. But that's not all, Ryan. If you continue, there's also more. Creating a wallet is confusion. Confusing. Well, here is the Treasury direct to spin up an account with Treasury, I guess. It is like tax ID number, email address, bank account and routing number, password, password reminder, personalized image, caption, security questions. And then here is, I think, a Bloomberg terminal with a quote, no one cares enough to learn Ether scan.

Starting point is 01:25:10 Look at this image and tell me that that just image makes sense to you. Like, get the hell out of here. That's ridiculous. And so I think the part message is that, yes, CryptoUX is confusing because you haven't used it before. As soon as you use it, it becomes super intuitive. Yeah. Do you know, I remember a couple years ago when I was talking to like the 18 year old founders of Instadap, you know, who grew up in India. And they're basically like, do you know what we don't understand is like banks and traditional financial services? You know what's super easy?

Starting point is 01:25:45 Crypto. Crypto. Metamask. Defi. They're just growing up with these things. Yeah, I don't think banking ux is better no it's awful i mean that crypto ux is terrible sign in with ethereum click a button hit a proof and pay done right this is going to get a lot better over the next few years as well i'm bullish on that 100% uh this is a take from me uh Ryan you want to read it yeah the last cycle is drawing to a close david says the dawn of the next cycle is upon us wow that sounds very uh epic i feel like i want to charge into battle with you after this where we going where's the battle david what you mean Well, I mean, I think you can take this one at face value. SBF is in jail.

Starting point is 01:26:25 Three hours capital is on the run. Doquan is in Serbia. Like, yields are at zero. I mean, like, there's not much left to do. Like, the contagion is got to be at the end. You mean we've taken out the trash. I'm taken out the trash. Yeah.

Starting point is 01:26:40 And we are identifying bullish sectors. Again, optimism, arbitram, all-time high transaction volume, still got the ZK EVMs and Starkware and all of this stuff. Some things are up and to the right, while the other things that are down and to the right are coming to a conclusion. I think that I'm declaring January 2020, 23 will be the time where we can look forward and consider us in a new cycle, the beginning of the new cycle. New cycle. So it was a super cycle all along, huh? It was not a super cycle. It was always a super cycle for building, though, wasn't it? Yeah. Can we say that? Always a builder cycle. Yeah. All right, man. So what do you bowl

Starting point is 01:27:21 Sean. Yeah. And so looking at our notes, I think you and I were both impacted by this Vitalik podcast that we recently recorded. And I'm bullish on adults, structure, and agency. And so these were some of the themes that I think came out of my head while we were talking to David's bullish on responsibility. Responsibility. Yeah. Wow. One of the big themes of Vitalik has was like, yeah, like it's crypto small enough where people can impart agency upon a you, listener, can change the direction of crypto. And that is one of the reasons why I got into this space personally in the first place was that crypto was small enough and I had enough ideas that I could help shape and direct crypto. And we need more clearly out of 2022, more good

Starting point is 01:28:08 adults who can build stable foundations and stable structures and believe in themselves to tilt this industry for good. One of the big quotes that's always impacted me out of Chris Berniske was that the plasticity of crypto, the window of plasticity of crypto is not infinite. There will be a time where we can't really change this industry in a direction that is good for us all. And so I'm bullish, Ryan, on people that are responsible that are actually building something for the other parts of this industry to latch onto. And I mean, I think we have done a bang-up job building bankless.

Starting point is 01:28:44 And so, Ryan, I'm bullish on bankless because we have so many goddamn plans in 2023. You're starting to tease them out, launch the acquisition of Earnify, bankless collectibles, a new website coming soon. There's other things that are on the horizon, cough, cough, NFT. And so there's a bunch of cool stuff that we are trying to do because, God damn it, we want to build structures for other people to also leverage and use. And so bankless media is going great. I'm excited to do this more into the future.

Starting point is 01:29:12 I love, by the way, that the guy in the SpongeBob sweater is telling me how bullish he is on adults and responsibility. It's just perfect. And I will say David. Well, I'm not in jail, so I get to say that. Okay, that's fair, fair. And look, man, if you were in jail, we'd still be doing this podcast. Somehow I'd find a way. I'd visit you and, you know, we'd fade it up.

Starting point is 01:29:33 If I was in jail, I would hope that it wasn't for a reason to... It would be because the, you know, the U.S. has gotten pretty bad to, you know, like, it would be something like this. Look, but, man, you stole mine. Mine was agency, too. Yeah. I'm bullish on that. You know, instead of that, maybe I'll say something else, kind of riffing off of what you said,

Starting point is 01:29:52 which is what a way to impact the world. I don't know if I give off like a politician vibe sometimes or something. Maybe it's the glasses. But I can't tell you the amount of people who have said, so when are you going to get into politics? Are you going to do something in politics? And I'm like, I'm in politics. Like this is political.

Starting point is 01:30:12 This crypto movement is political. And it's a movement where it's small enough and it's early enough. And it's important enough that we can have a massive impact politically. And this is like a much pure manifestation of my values than at least in the U.S. You got to pick Republican or Democrat. I'm like, no thanks. I'll pick like anti-authoritarian. I'll pick that.

Starting point is 01:30:35 Where's the party that like I'll do that thing? Personal agency. Yeah. How you're like that? How you like damn adjectives? Like those things, I'll do that. But that's not represented in a party. Guess what?

Starting point is 01:30:44 These values are represented in crypto. And this is why I think, I'm super bullish entering 2023 that the riffraff is gone, right? Like, not all of them. I mean, like, Justin's son still hanging out here somewhere. I think Richard Hart's, like, just, you know, in my tweets lurking. Like, they're not all gone, but there's been a lessening of them. And that feels really good because it allows the adults, the people who care about these values,

Starting point is 01:31:10 to keep building the system that we've been building this entire time, and for it not to, our work to get crowded out by the noisy ones. So, look, agency is mine too. And impact, I think. Maybe that's the other word I would add to this, fray. And I think this is alpha, because at the end of the 2018 bear market, the destruction that was 2018, you saw structure starting to get created. Uniswap v1 came out in, like, February of 2019.

Starting point is 01:31:39 Maker Dow died. The original die savings rate came out in 2018. And so now there's still plenty of structure left over. DFI is still holding up just great. And now there's more structure to latch on to. Come, settle, and build your structure in this space. And keep on going from there and just settle in. Be a settler.

Starting point is 01:31:57 All right. Here we go. Memes of the week. We got two. This is great, David. What are we looking at? Describe the template. This is the WoJack meme where things just get worse and worse and worse.

Starting point is 01:32:07 So you have kind of the bleary-eyed, like, scrappy beard, whoa-jack. Starts bad. He's asking how much worse can it get? And we've got Alex Machinsky flexing his banks are not your friend's shirt. Like totally right. Great shirt. And it's like, oh, oh, God. And then the next one, it's like even more wiry here, even more blurst eyes.

Starting point is 01:32:28 And again, the question is, how much worse can it get? Then you got Suzu and Kyle Davies. And then it just continues. Like an insane looking WoJack, how much worse going to get? You got Sam Bankman-Fried, followed by DCG and Gary Silbert. And then the block really just rises home. And at this point, you are just watching some, like, ring version of WoJack. it's how much worse can you get?

Starting point is 01:32:47 And it's the block sitting on top of pile of cash. The block almost dragged me down again to the depths of sadness of November. Dude, what crypto media? It didn't last, but like, yeah, that was like, you know, that was rough, crazy. Yeah, that's a sad meme, but also tells a story. How about this meme? Actually, this is not a meme. This is a real, this is the front page.

Starting point is 01:33:06 Of the New York Post. It's a picture of SBF. What's the caption here? SBF with his, you know, his hair is all over the place. Big, big, bold letters. Harry Plotter. Harry Plotter. Nice.

Starting point is 01:33:20 You're closed. All right. Let's fade us out. I'll do disclaimers, but we got a pretty fresh meme. Sorry, moment of Zen, right? We have the best moment of Zen.

Starting point is 01:33:29 You have ever heard. It is a full-length song. It is great. I think that if you are hearing this now, listener, you have earned your stripes. You have earned your battlescars. You have completed your first cycle.

Starting point is 01:33:41 And this is your reward. And this is your reward. This moment of Zen is for you. Enjoy it, guys. I got to fade out with this. None of this has been financial advice. Never is. Crypto is risky.

Starting point is 01:33:51 You could definitely lose what you put in. But we are headed west. This is the frontier. It's not for everyone. But we're glad you're with us on the bankless journey. Thanks a lot. Welcome to all of you first cyclers.

Starting point is 01:34:05 Your life's about to change. You're probably for the worst because it'll take hold. I won't let you get away. And your friends don't want to talk about crypto all day. Oh, you're gonna feel late no matter when you came So don't feel bad, we all felt the same You'll go through phases, the money, the tech,

Starting point is 01:34:25 you'll learn Moloch and probably lose respect for your government Hey, they're just people too, and incentive alignments what we're here to do So you're in luck and join something great We're gonna change the world with what we create So welcome to all of your first cyclers Your life's about to change your problem for the worst Because it'll take hold of them, won't let you get away And your friends don't want to talk about crypto

Starting point is 01:34:46 all day. Oh, we're glad you're here and we hope you have fun because you'll never get out once you've begun. Just do your research and don't ape in yet or you might get blown up by BitConnect or algorithmic stablecoins or 80,000 percent APY Ponzi's or shady crypto banks or a bridge hack or OFAC

Starting point is 01:35:13 or Gary fucking Ginsler or fake ICOs or pump and dump YouTube personalities or Alt layer one rock pullers or asshole mercenary crypto fund managers that sound a little like Smeas Mero Smapidol

Starting point is 01:35:29 SBS etc So welcome to all of your first cyclers your life's about to change You're probably for the worst Because it'll take hold and won't let you get away And your friends don't want to talk about crypto all day

Starting point is 01:35:47 I know it all sounds confusing what people say Well, you're still new, so that's okay. You know you're doing better when you understand. Curve pulls, hash rate tornado cash banded. Why, a cartoon with a dick for an ass is worth two trips to Europe. Flying first class, U.S. reliers can be coerced, but at this station, censorship is way fucking worse, but we'd UASF, so it'd be all right. And they'd have circle, but we'd have die rise.

Starting point is 01:36:17 Even better at LUSD, we're decentralizing the world and will succeed. So welcome to all of you first cyclers. Your life's about to change. Your problem for the worst. Don't take hold and won't let you get away and you

Bankless - ROLLUP: SBF Arrested | Trump NFTs | Binance Bank Run | Fed Inflation | Proof of Reserves | Bored Ape Lawsuit

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