Bankless - ROLLUP: SBF in the USA | Visa Ethereum Payments | Trump NFTs | Binance Buys Voyager

Starting point is 00:00:00 SBF coming home, extradited to the U.S. Prison wasn't so great for him, so he wanted to, you know, work his way home. Brian Armstrong makes regulation proposals that we wish that we had, and also visa steps into the Ethereum frontier. What does that mean? Bankless Nation, it is the Friday before the holidays. David, what time is it? Oh, it's the Bankless Friday weekly roll-up, Brian,

Starting point is 00:00:23 where we cover the entire weekly news in crypto, which is always an ambitious endeavor, and we are almost at the finish line of 2022. Thank the Lord. Yes. And so if you have not yet grabbed a morning coffee to enjoy the weekly news and crypto with us, please do. Put some bailies in this one because, you know, let's get festive today. Why not? All the calls I've been having with people have been like, they've been at their parents' house or something like visiting family this week. And you are there too, right? So you're on the West Coast today.

Starting point is 00:00:52 I am freezing my absolute tail off in the bottom of my sister's house with a sleeping baby in the next room. So this is a different kind of weekly roll of. Guys, I want you to know this level of dedication. All right. This is what David Hoffman does on his holiday while he's with family, sleeping babies. It's the crack of dawn when there's no sun. There's no sun out and we're still getting a weekly roll up to you right before I take off myself. All right, David, so what are we going to talk about this week? What are the topics? Of course, there are some SBF updates. He is no longer right in the Bahamas. He is in New York with hanging out with the FBI. So that's what's just. Just what's just. visiting family too just visiting temporarily or perhaps more permanent uh so we'll talk about all of the spf drama caroline ellison apparently cooperating with the fed so we'll talk about that too

Starting point is 00:01:44 uh brian armstrong proposes crypto legislation that we wish we had uh so we'll unpack all of that and also visa is taking a big step into the frontier of ethereum protocol development we'll talk about all of that and more one of the things as well that's going on this week is buying is talking about bailing out Voyager, doing the thing that SBF promised to do, but was never able to manage. So that's an emerging story as well. David, we got our friends and sponsors, Cracken, to tell you guys about today. Cracken is a crypto platform that did not rug us in 2022. There are a few crypto platforms that I recommend coming out of that that crazy year that we just had to people. And Cracken is one of those. Can you tell them why? Yeah, Crackin is one of these few exchanges that are living and breathing the ethos of crypto to the best of their ability while also being a centralized exchange.

Starting point is 00:02:39 And that is why we are choosing to work with Cracken in 2023 as our strategic sponsor because, Ryan, they use cryptography to empower individuals. These are words that I love. And so with their proof of reserve system, they allow their users to verify their own liabilities inside of Cracken. And just when we interviewed Jesse Powell, he just exuded the crypto. ethos that I know that you and I are all about. And we still need centralized exchanges to go bankless. That is many, many people's first step. And so we are working with Cracken in 2023 more closely to emphasize the best of what their product has to offer for the bankless world. Yeah, I think, look, when it comes to a centralized crypto platform, if you're a customer

Starting point is 00:03:21 of that platform, you should have the ability to verify whether the crypto platform has your deposits and whether they're backed by real assets, full stop. And Cracken has a proof of of reserves system that they have rolled out to do that. They've been doing proof of reserves for a long time. You can find out more about that in the link in the show notes. That's cracking.com. David, let's get to the markets, man. What's Bitcoin doing to us today? It's going down. It started at 17,000. It's doing something to us rather than for us. Exactly. We are feeling the Bitcoin. Yeah, it is at 17,700 at the start of the week, ending the week at 16,700 down about 6% on the week. down 6%

Starting point is 00:04:01 okay so yeah this is a little bit of a the timing of the measurement we just happened to start last week at a little bit of a high and now we're kind of back to like two weeks it's flat I mean but like

Starting point is 00:04:11 1600s that doesn't feel great does it no it does not I mean we are below the 20 the 2017 all time high army for Bitcoin buy a lot yeah how about Eith that's also below the 20 18

Starting point is 00:04:24 yeah all time high yeah what's what's what's he doing on the week down 6% on the week as well, 1,200, 70, down to 1,200, a little bit more than Bitcoin. Bitcoin was a little bit less than 6. ETH is a little bit more than 6% down on the week. Guys, I don't think we're going to get our bullish recovery, our V-shaped recovery in 2022. I feel like that's a safe one to call, huh, David? Yeah, people were-end down. People were kind of bullish for a green December, but December

Starting point is 00:04:49 so far seems to be pretty weak. And we're down on the year. Like if we look at the year, like if we look at the year for Bitcoin and Eath. What do you mean, but, okay. Well, no, actually. So, no, what ETH was like at the start of this year. So December 23rd of last year, I remember it being in like the 800s, something like this. So I think we're up from that, at least. Wow. We're looking at the charts. I don't know.

Starting point is 00:05:15 It seemed like a long time ago. No, no, no, no. You're skipping. You're two years. You're thinking in two years right now. Am I really? Yes, you are. Yeah, because ETH was $4,000 in December of last year.

Starting point is 00:05:25 Guys, the years are not blending together. Oh, okay. Yeah. Cancel that. That was wrong. It's true. It's the amount to two years. I was thinking about 2020 of December, wasn't I? You got confused because we were recently talking about this when we were doing our ETH, bull case or Eth with the bulls that we recently did, which I believe comes out Monday.

Starting point is 00:05:47 Yeah. It does. You were thinking in two-year time frames. Sorry, brother. All right. So we're up on the two-year, though, David. That's the silver lining. But look at the one year. Wow, we were-one-year. One year is literally down only. We were 4K last year at this time on ETH. Definitely down. Definitely down here. In complete denial of the bear market. Yeah.

Starting point is 00:06:07 I basically was subconsciously for a minute there. How about the ETH Bitcoin ratio? What's that looking like? The ETH Bitcoin ratio down 1.5%. We are down to 0.0718. We shaped off a nice $2 trillion this year in terms of crypto market cap, I believe. And we are under a trillion dollars. What's this number this week, David?

Starting point is 00:06:30 Yeah, we were at roughly 900 billion in total market cap last week. 837 billion is the total market cap this week. Yikes. A few trillion down. But I want to say to everyone listening to bankless, and we know you guys have been with us through this mighty fall from 4,000 all the way down to 1,200. Congratulations to you, because you have survived 2022. It's almost over.

Starting point is 00:06:58 This is a market that, as I just mentioned, is $2 trillion down from the top in crypto. That's a lot of zeros down. We've also suffered the worst inflation, David, in over 40 years. And we had the death of one of the three largest crypto exchanges this year. FDX just evaporated. SBF is literally in jail right now. And not just an exchange, an Algo stable coin. all of the biggest like lending platforms Celsius blockfi voyager the biggest hedge funds in crypto all evaporated

Starting point is 00:07:35 last year and yet you you are still here you are still listening you survived and i think that is worthy of some holiday celebration congratulations for surviving 2022 you definitely earned it yeah that's it's worth noting that like it was not easy to do that it was not easy to get through 2022 and this is one of the if you zoom out as to what crypto is going to do for society and for all markets, all financial markets, like holding on to your crypto assets from now into 20 years from now is not easy. Like people get whipped off by volatility. They get enticed by leverage. They play in the shit coin casino.

Starting point is 00:08:16 If you are still around, congrats. That was not a hard thing to do. That took mental resolve. That's the thing. When you say, David, it's not easy. You're absolutely right. It is not easy. And yet, David, it is so, so, so simple.

Starting point is 00:08:29 It's simple. It's not easy. It's just like a whole bunch of things you don't do. Yeah. Yeah. Just hold. How about that? Just hold rather than going margin, rather than playing kind of the shit coin casino,

Starting point is 00:08:43 rather than like aping into you the latest NFT, right? You just hold for the long term and you would have been fine through this. As long as you can bear like these kind of, you know, 70 to 80. 80% downs from all-time high. But there is a silver lining here, and that is defy is rising. Look at this. This is the decentralized exchange user growth across all chains. And this starts in January of 2020, over two years.

Starting point is 00:09:11 Look at this, the number of dex traders over time on Ethereum. We're above 5 million now. We're closing in on 7 million. And that was basically nothing two years ago on Ethereum. And we're also seeing this on Polygon. Okay, we have almost the same amount of total decentralized exchange traders on Polygon now. Binance smart chain, Solana as well, up, optimism, massively up. And of course, this is a layer two.

Starting point is 00:09:39 So we're seeing some massive... Optimism currently is accelerating more than any of those previous charts. It really is. And let's talk about that a little bit more, David. This is a stat from layer two beat, which tracks the progress of layer two's. What are we looking at? Yeah, specifically this. It's framing that they use scaling factor.

Starting point is 00:09:58 So in this graphic that we're looking at, in the last 60 days, the scaling factor of layer twos was 2.4x, as in 2.4 times the amount of Ethereum layer 1 transactions happened on layer 2. And I really like this new metric, scaling factor. I think that's going to be a metric that sticks around. Okay. And so basically 2.4x, it says over the past 60 days, there was 2.4 more transactions in the Ethereum ecosystem thanks to layer twos. So that is basically doubling the scalability of

Starting point is 00:10:31 Ethereum. Right. Yeah. So 63 million transactions happened on the eighth layer one and 88 million transactions happened on layer twos. Cool. Yeah, very cool. Here's another stat for you too, David, on layer twos. Layer twos have actually flipped the Ethereum base layer in terms of aggregate transactions per second. And you can see that in the chart. Layer twos are in the green here. And every since October. They've been above Ethereum in terms of transaction activity. Pretty impressive. Yeah. I expect this to only continue into 2023. The lappening also can apply here as well. Like, when can we get to 10x Ethereum layer one's transactional activity? Probably sometime in 2023, I bet. I definitely think that's coming. And let's talk about some of the old

Starting point is 00:11:20 defy coins as well. Maker Dow recently experienced. increase in revenues, and that's interesting. Imagine a defy protocol generating revenue. Maker Dow has done this fairly consistently, especially in thanks to real world assets. WRA is the acronym for that. The real world asset category is expanding pretty quickly in Maker. What are we looking at here, David? Yeah, so this is a chart that shows the distribution of types of assets inside of MakerDAO, and that blue section in the top right corner is the real world asset section, which is now over 50% of all types of assets inside of MakerDAO. And you can, if you click that chart right there, you can see how much money that they are making. Speaking of charts that are going up and to the

Starting point is 00:12:04 right, this chart was basically nothing in January and April of this year and is now over 600 million dollars of revenue from real world assets going into the Maker Dow Treasury. And like this is a landscape that no other defy app is going after. And some people don't like it because it's centralization risk, it's real world risk. That's a fair take, fine. But also just like, think about being able to charge interest rates on the world. Like no other defy app has that in their sites other than MakerDAO. And they're actually executing on this, $600 million in revenue a year going into MakerDAO by charging real companies, real money. I think that's bullish. These real world assets are things like treasury bonds, zero to one year maturity, one to three year

Starting point is 00:12:52 maturity. So these are traditional legacy assets that are being put into these DFI protocols. There's also real estate in there as well, but much, much less than that. Real estate. Tokenized real estate, David. Who would have thought? Let's talk about what you're doing during the bear market. I was thinking about this as we're preparing the roll up for today. What to do during a bear market? I came up with four answers to this. And I want to get your take on this, David. Number one, I think, what do you do during the bear market? Invest in yourself and acquire skills. This could not be more important. This is a fantastic way and time to build marketable talent, things, skills that you can sell to crypto companies. That's number one. Number two,

Starting point is 00:13:41 start a side hustle in crypto. So if you're not fully employed in crypto, then it's your full-time hustle. But if you're not, this is a great time to begin experimenting. I mean, join various Dowels. for instance, start a side hustle. Bankless started as a side hustle for both of us, didn't it, David? So even if you have some sort of opportunity to roll in crypto, you could still engage in side hustle. It's a very side hustle friendly environment. Number three, dollar cost average into the gems, not financial advice, of course. My take is 70% ETH, that's what I'm doing, and then 30% other dollar cost averaging in during the bear mark is another thing to do. And number four, build your network and meet as many people as you can. It's a fantastic time to meet more settlers,

Starting point is 00:14:29 like yourself, more builders. This is the best time. Like, all of the, all of the people who are here for kind of the short-term gains, they're gone. They're out of the space, mostly. And so there's a lot of signal in the space now and a lot of quality people. And this is a time to begin building relationships, build out your network, get on Zoom calls with people, get in people's DMs, provide some value to them, write articles, publish posts, you know, contribute in some way to the ecosystem and build those relationships. So these are my ideas for a bear market. What's your take on this, David? And I'm curious what gems you're buying. Are you dollar cost averaging in yet? And what are you looking at? Oh, I'm always dollar cost averaging in. Like that button never turns off for sure. I'm looking at these one through fours. And I'm just like being. taken back to the 2018 to 2020 bear market because this is exactly this is exactly what what I did.

Starting point is 00:15:26 Yeah. I was kind of thinking about you doing this. Yeah, exactly. Got in, got out of physical therapy and into consulting inside the crypto space. So that was my number and that was my number one. Starting a side hustle was my first podcast before before starting the bankless podcast, which like was also developing skills for the bankless podcast, of course, was buying a dollar cost averaging I was definitely doing. You could also call it dumping a paycheck every single two weeks. Same same. But then and then number four like it's number four is where one through three get expressed. So make yourself better, acquire skills, start a side hustle that you can talk to people about, get skin in the game, but then go out and meet people because it like Ryan said, when you meet

Starting point is 00:16:11 people in the bear market, it hits different than a bull market. Because if you meet people during a bull market, like sometimes I'm like, are you going to be here in two years? I'm not sure I'm going to like expend my time engaging with you and I don't know you're going to be here in two years. When you meet people in a bear market, you don't have that query. Like everyone understands like, oh, we are in it. We are here together. And so like it's just easier to build a network in that context. Honestly, I think all four of these could be its own separate like a post or podcast that we talk about.

Starting point is 00:16:40 But could you talk about number four for a minute? Because I consider you very good at this, building a network and meeting as many people as you can. And so what does this mean in crypto? Like networking, right? Does this mean you're going to crypto conferences and handing out your business card? No, it does not mean. How do you act? Okay, it's not that.

Starting point is 00:16:58 So how do you actually meet people and how do you find the right people to meet? Because, you know, there's definitely an 80-20 role with respect to people. Like, you want to find that kind of the, you know, the 20% that would deliver 80% of the value, you know, to including your network and get in relation. So how do you even screen those people? How do you find them? What's your method? It's a little bit about are you seeing the same people on a reoccurring basis. And this works both inside of conferences in real life, but also Twitter too. You can build a network on Twitter is what it is for. And so if you are showing up on Twitter and providing value on Twitter, you will just naturally grow followers. And then you'll also start to become first in Twitter. You'll see other people

Starting point is 00:17:42 engaging in your tweets. And you can grow a network on Twitter. And this is when Ryan said, like don't be afraid to slip into someone's DMs, grow a relationship that way. So, you know, and Twitter is just like the precursor to in real life conferences, by the way. And so when you are tweeting and stuff and you are engaging with people and others, you will see many of those people at conferences. And then when you go to your second conference or your third conference or just meetups in general, you'll start to see the same reoccurring cast of characters. And you have to be social and you have to be able to go up and say hi.

Starting point is 00:18:14 You're going to go into our Twitter DMs Yeah, I'm going into our Twitter DMs And scrolling up and to actually track this When did we first start talking? Wow, my first DM to you December 1st, 2018, I said to you I do not understand the resistance to Ethereum On behalf of so many bitters, Bitcoiners,

Starting point is 00:18:32 It is utterly confusing to me. Wow, we have not changed at all. That was the first DM you sent me And then I said, I've been trying to figure this out Well, as well, at the core of the value systems appear so similar. Wow. Wow. We have not changed tuned whatsoever. Yeah. And then back and forth, Maxwellism is blinding. This is the beginning of a conversation we had where, you know, David just got in my DMs and I was reading some of his work that he was posting on Medium. And then we just, I mean, from there, it developed. It took a while. It took many months for us to start, like, working together in the newsletter and then eventually starting a podcast. But that's where we started in the depths of the bear market in 2018. Wow, 2018. What a throwback.

Starting point is 00:19:13 Anyways, something to consider is optimizing for luck surface area, which means putting yourself out there, putting value out there. Like when you are investing in yourself and acquiring skills, make sure you find a way to broadcast those skills so you can let people know that you're a useful person. And then just start growing the relationships in ways that create serendipity. And that can be true on Twitter. That can be true on substack. That can be true in real life events, that just casual meetups.

Starting point is 00:19:41 but I would emphasize that in real-life meetups do provide value that you kind of can't get in the metaverse because it's like meeting humans meet face-to-face, Ryan. I feel so attacked right now. Well, let's talk about some of the gems piece of it, right? Of course, you know, everyone listening knows we are bullish Eath and you'll find that out even more when our episode on Monday comes out. There's some other gems in this market too. Ryan Selkis was recently on the bankless podcast. he called a bottom for defy.

Starting point is 00:20:12 I think there are some really interesting defy tokens out there. Again, not financial advice, but that's something that I'm looking at. Also, even in the public markets, David, this is a tweet from Matt Hogan about Coinbase. What's he saying here? Yeah, so he tweets out saying,

Starting point is 00:20:28 Coinbase raised money in 2018 at an $8 billion valuation. It is currently trading at a $9 billion valuation. Meanwhile, revenues are up in that same time frame from $520 million to $3,000. 3.3 billion. Users are up from 22 million to 101 million. And assets on the platform are up from 11 billion to a 101 billion. So same valuation going back for four and a half years. But meanwhile,

Starting point is 00:20:52 all the metrics are up about a 5x, 5 to 6x, sometimes a 10x on assets on the platform. So like, do the coin base stock hit a low of $35 when it opened up at like something like $450? Like coin base stock is one of going to be like one of the most generational buys of all time. It's got to be. Not financial, but I don't own any because I don't own in stocks, but whatever. Yeah, I mean, these numbers are pretty compelling, to be honest. My only question whenever I have some money to dollar cost average in is, okay, should I do this or should I go buy some more ETH? Right, right? It's kind of the question because they're certainly correlated.

Starting point is 00:21:31 Anyway, there you go, guys. A lot of things you can do during the bear market to keep busy. David, what do we have coming up next? SBF coming home. extradited to the U.S. Prison wasn't so great for him, so he wanted to, you know, work his way home. Brian Armstrong makes regulation proposals that we wish that we had and also visa steps into the Ethereum frontier. What does that mean? All of this and more, right after we talk to some of these fantastic sponsors to help you go bankless. The reality today is that five corporations

Starting point is 00:21:58 control the entire world of social media. They own our names. They restrict our content. They monitor our every move. And their time is up. Thanks to our sponsor, DeSoe. DeSoe is a layer one blockchain, from the ground up to decentralize and scale social networks. With DeSo, you can own your own identity, content, and social graph, and take it with you across hundreds of applications already built on the censorship-resistant DeSo blockchain. DeSot storage advantages make it finally possible to build infinite state applications that can efficiently store and index large amounts of content and data fully on-chain. DeSo also offers multiple crypto-native monetization primitives for developers and creators, including social NFTs, social dows, social tokens, and social tipping.

Starting point is 00:22:41 So in order to experience the social layer of Web3, go to DeSo.com and claim your username. That's DESO.com. TrueFi is DFI's largest credit protocol, connecting global lenders with institutional-grade lending opportunities. TrueFi has completed over $1.7 billion in originations and paid out nearly $35 million to lenders, proving that DFI is ready to take its next big leap into the $8 trillion credit market. TruFi gives lenders, like you, access to sustainable high-yield opportunities backed by

Starting point is 00:23:12 real-world investments, usually reserved for high net worth individuals. At the same time, fund managers use Trufi's financial infrastructure to bring their portfolios on-chain, benefiting from the global liquidity, cost savings, and transparency of Defy. TrueFi is a decentralized financial utility. The protocol is owned and governed by the Truffi Dow, and Truffi is here to bring DeFi into the golden age, bridging the power and access of crypto, with institutional-grade lending opportunities and portfolio tooling.

Starting point is 00:23:36 Explore the diverse financial opportunities available on Truffi or launch your own portfolio at Truffi.io. SBF back in the USA. Maybe not of his own will. I'm not sure. There's an extradition here, but it sounds like the prison system in Bahamas left something to be desired. We'll talk about that.

Starting point is 00:23:54 Just, I guess, getting into this again, Jake Chravinsky had a fantastic summary. He tweeted this out. Two months ago, SBF was debating the future of crypto policy, and nobody knew FDX was a sham. One month ago, SBF was apologizing for losing billions, and everyone worried for losing billions, and everyone worried he might get away with fraud.

Starting point is 00:24:15 Today, SBF is in FBI custody, and his chief co-conspirators have pleaded guilty. It's amazing how fast all this has unfolded. Jake says, it's very rare to see criminal prosecutions move so quickly. That's the high-level context. Look how fast all of that happened. Two months ago, SBF was on this podcast, debating crypto policy. Right.

Starting point is 00:24:41 And now he's in jail and in FBI custody. So I don't know if this votes well for other previous bankless guests. Other guests, please don't take that too seriously. Yeah. But it's crazy when you see up. It's fine. Look, it's honestly not that hard to do well in crypto, but just by playing. long-term games, but SBF was clearly not playing that. So give us the story. It sounds like

Starting point is 00:25:07 SBF was having a bad time in jail in the Bahamas. What were the conditions like and what might have led to his extradition to the U.S.? So the conditions of the Bahamian jail are not great. There are buckets, for example, that are required for all inmates. You can guess what those get used for. There was, oof, this report says cells were infested with rats, maggots, and ends. sex, I'm just going to go ahead and guess that it was a miserable place to be. And so it made it really easy for SBF to just wave the white flag and say, fine, just extradite me to the United States. If that's how it happened, that kind of makes sense. I don't really know if that's how that happened, but that's what people are speculating as to the how bad the Bahamian prison was, just like

Starting point is 00:25:51 SBF was like, fine, extradite me. Yeah, he's like, I don't want to spend Christmas here. Yeah, exactly. Yeah, send me home to mom and dad. So now he is in New York City. So that was last night at the time of recording. So Wednesday night, Thursday morning, he was flown from the Bahamas to New York City in custody of the FBI. And that is where he currently resides. So SBF, wow, looking unshaven and unkempt and definitely pretty sweaty being escorted off a plane in or excuse me, that is a photo of him being escorted onto a plane in the Bahamas. Yeah, definitely a different climate he's entering in New York City at this time of year. Yeah, for sure. He's probably cold.

Starting point is 00:26:31 Interesting is that Alameda's Caroline Ellison and FTCX's Gary Wang have pled guilty to the Department of Justice fraud charges and also have settled with the SECC and CFTC. They've already settled? Either that or looking to settle, yeah. So they have been talking. The SEC and also CFTC has charged Ellison with market manipulation of the price of FTT. No surprise is there. But it looks like that they are. moving faster than SBF is when it comes to going down the prisoner's dilemma, rabbit

Starting point is 00:27:07 wall. Yeah, you know, you have to wonder what those private conversations were like, but I bet it it was a lot of like full cooperation and I'm happy to rat SBF out and I have no loyalty to him. I bet it was some of that. Maybe that's why this case is moving so fast. Yeah, perhaps. Perhaps.

Starting point is 00:27:26 Yeah. What's also interesting is that now that this asset recovery program, has started, they're actually starting to find money. So a new headline out of Defiant says, FTX finds $1 billion inside of hundreds of company bank accounts. What? With no less than $720 million of cash. So it's not like illiquid FTT tokens.

Starting point is 00:27:52 They found $720 million of cash in hundreds of bank accounts. Hundreds of bank accounts? This kind of feels like with me and my, My multiple times I got the uniswop airdrop because I was too chaotic to own my own Ethereum addresses. So I just had like 20. The couch cushions? Yeah, the couch cushions. But I didn't have those.

Starting point is 00:28:10 Shout out. Urnify. By the poise. Yeah. If I could help with this, guys, if it was, this is, these were all defy wallets. But, okay. But, um, so they're just like searching the couch cushions basically. But yeah.

Starting point is 00:28:22 You know what's impressive? Hundreds of company, of company bank accounts. And have you ever seen those, those pictures of the, um, the, the org structure. Uh-huh. of this FTX empire in Alameda and all of the companies and sub-companies and joint ownership things. It's an absolute mess. It looks like a circuit board. I'm almost blown away by the complexity of this and how he was able to accomplish this.

Starting point is 00:28:46 Yet that's almost like, you know, FDX has only been around for what, like four years, something like this. Yeah, less. It's like starting a new bank account like every couple of days, every two to three days. You're starting a new bank account, forming a new company. So that's why it's somebody's job? Like, how do you even do all of this? It's impressive at that level from a scam perspective. From a scam perspective.

Starting point is 00:29:09 Anyways, in addition to just finding their own money, they have also engaged in clawbacks. And so it's an article out of the Guardian says, FTX intends to commence actions before the bankruptcy court to require the returns of such payments, political donations, with interest accruing from the date any action is commenced. Sharing an email address, FTX Repay at FtX.us that recipients could use to voluntarily return money. Recipients are cautioned that making a payment or donation to a third party, including a charity, in the amount of any payment received from an FTCS contributor,

Starting point is 00:29:44 does not prevent FTCS debtors from seeking recovery from the recipient or of any subsequent transferee. They added in a statement basically saying, hey, we're coming for you. Hold on to that money because that's ours. Don't spend it. Don't spend it. Yeah. The politicians, the celebrities, the charities.

Starting point is 00:30:02 This means, I guess, Kevin O'Leary will have to give back his $15 million. Does this, do you think this means the... I bet he actually keeps it because that was actually a payment to him. You think? So that's different? I don't know. I don't know. Actually, I'd be interested in it, like...

Starting point is 00:30:17 Donations, I think. I mean, so they send a contract with Kevin O'Leary, I'm assuming. But he should give it back anyways. What are the... He definitely should. I kind of wonder about, like, you know, know, Kobe and Ledger at Up Only, if they'll be subject to this clawback do. Yeah.

Starting point is 00:30:33 I mean, it's not a ton of money. No, because it's like a, it's a contract that they signed with them for services. And they've read with the services? Yeah, and they've performed the services. And I don't know. I don't know either. Yeah, what constitutes a clawback? Look, definitely if you, if you're Kevin O'Leary, you should give the $15.

Starting point is 00:30:51 Yeah, if you're a politician, you should definitely give the money back to you. That's a really bad look to just keep that money and spend it on. campaign financing. The headline of this is FTCX seeks a clawback donations to politicians and charities. Do you know, I have, I feel like I have closure on SBF at the end of 2022. If he wasn't in jail, if there wasn't prosecution ongoing, like I would have felt like we were wounded in 2022 and the wound is still open. It's still raw. But now it feels like, you know, starting to scab over. Yeah, we can heal. And that feels really good going to 2023. It was nice hearing Jake Chrivensky say, wow, it was surprising how fast this went, because

Starting point is 00:31:28 In the middle of it, it was like, why isn't he in jail yet? It did not feel fast. He's getting away. We're watching him get away with it. Oh, he's in jail. Just kidding. Thanks. Awesome.

Starting point is 00:31:41 All right. Well, in the meanwhile, Brian Armstrong was actually putting together a regulatory proposal in his post about this. This kind of reminded me of the antithesis of SBF's post on regulatory that happened like two weeks ago, or sorry, two months ago, I guess. And this is a post from Brian Armstrong. I tweeted this out. Less than 60 days ago, I read SBF's crypto regulatory proposal. It was hot garbage. And it turned out, so was FDX. The proposal we saw from Brian Armstrong was much more practical and saying, here's the full post on Coinbase. What's the TLDR of this? What is Armstrong saying the title of this post is

Starting point is 00:32:24 regulating crypto? How do we move forward as an industry from here? What is he saying about how we move forward, David? Yeah, there are three pillars that he puts into this proposal. One is create regulatory clarity for centralized actors. No surprise there. He names three further centralized actors that he wants clarity for. Stable coins, exchanges and custodians, and commodities and securities. So making it more clear as to who can issue a stable coin and how that can be structured,

Starting point is 00:32:51 he even gets a little tidbit as to like if you're a bank, you can issue a stable coin and do fractional reserve. if you are going to be compliant in all the banking licenses. Exchanges and consortians, of course, you need more regulation there. And then also commodities and securities. Just need clarity on what's a commodity, what's a security, things we've been asking for forever. And so that's the first pillar. And second pillar is enforce a level playing field. This is definitely a tip of the hat to how onshore United States exchanges felt super

Starting point is 00:33:20 hamstrung to just the amazing set of products that FTCS was able to produce, because they were not on shore. And so in order to be competitive, our American exchange and also keep American U.S. money onshore, we need our exchanges to be competitive. So that's number two, enforce a level playing field. And three, let innovation happen in decentralized crypto. Brian Armstrong always keeping DFI in mind and saying like, hey, we, the whole point of crypto is to be like decentralized and do decentralized stuff. So let that thing grow and regulate decentralized actors like Coinbase appropriately. These are three fantastic. Pillar's it was so refreshing to read this thing. It's like, oh, this makes just so much

Starting point is 00:34:02 rational, logical sense. We don't even have to overthink this. Thank you, Brian, for posting this. Yeah, and I mean, part of this was in the DCCPA, right? Definitely part of kind of the exchange regulation. There wasn't as much on stable coins, but there was in the DCCPA, the legislation of which SBF was a proponent, some language about securities versus commodity. and some clarity there. There was a little something. I don't know if it went as far enough. But the difference is with the DCCPA

Starting point is 00:34:32 is basically treated all of Defi as if it was a centralized exchange and required similar levels of compliance and registration, even down to kind of like the front ends. Absolutely terrible piece of legislation that SBF seemed like he was crafting in order to like pull up the ladder

Starting point is 00:34:51 on all of the innovation that would come after him and install protections for FDX. Now, this is not what Coinbase is saying at all, not what Brian is saying at all. And, you know, I think he means it. I definitely, I hope he means it. But this at least is sensible, right? Let's kick the can down the road for Defi. It doesn't need this level of regulation at this point in time.

Starting point is 00:35:12 The easy wins clearly here in the U.S. from a regulatory perspective are stable coins. Let's do the thing where we get a Bitcoin ETF and it's actually a Bitcoin ETF. Let's finally here. with complete clarity from our regulators and lawmakers that ETH is not a security. Like, can we just do that? I mean, these are the easy, low-hanging fruit stuff where you can kind of institute this and allow DeFi to continue to flourish in the U.S.

Starting point is 00:35:42 So it seems like a no-brainer to me. It's, of course, not the perspective of all lawmakers here. But, yeah, this is a refreshing take on things. Yeah, I think certain, like, statist lawmakers are going to, look at this thing and it's like but how do we surveil people and stuff like that and stuff that's like it's not going to be able to come to terms of exactly and that that's where i'm happy to fight the battles but this meme of like oh people in crypto don't want any regulation no we just we don't want dumb regulation we don't want your regulation we don't want yes if you're going to

Starting point is 00:36:16 make regulation mean ban defy effectively then like no that's dumb don't do that um David there's some cool stuff going on at visa, though, stepping to the frontier. What's this about? Yeah, so global payments giant visa signaled stronger and sustained interest in crypto releasing a paper outlining how the firm could one day collaborate with the Ethereum network on automatic payments. And so they released a document, a research document of sorts, talking about account abstraction, which is a 400-level Ethereum topic, crypto topic, and how account and account-obstraction wallet could enable Visa to set up... automatic payments for monthly bills. So inside of this article, here's a quote,

Starting point is 00:36:59 many of us rely on automatic payments to pay monthly bills. In a few simple steps, we can set up reoccurring payments with a local utility or subscription provider with blockchain technology, potentially representing a new way to process payments in a distributed and programmable fashion. Could this everyday payment experience be replicated or even improved on the blockchain? With the punchline, Visa is exploring exactly that. And so this is a technical piece where Visa outlines how to write a smart contract app for a self-custodial wallet where that wallet is maintained exclusively by the user and the user has the private key and the application allows a user to set up a programmable payment instructions to push funds from their self-custodial wallet

Starting point is 00:37:41 to another wallet at reoccurring intervals without using the user's participation at each time. Basically, an automation of what a lot of just commerce is, but Visa is exploring how to do this with self-custodied account-obstracted wallets on Ethereum. And they are researching. They are pushing the frontier here. So this is super cool. Self-custodied reoccurring payments is a fantastic use case and bypasses the banks completely. How cool is that?

Starting point is 00:38:08 You know what else is cool, David, is this is actually a hackathon project that they've implemented. And you know, account abstraction is not yet available on Ethereum and the main net, but it is available right now in Starkware, in the Starknet ecosystem. And so they actually built this fully out on Starknet using Argent as the wallet. This is another example I think of like the Ethereum main net will be sort of more conservative for a while. And some of the innovation, like we already have account abstraction in Starknet, some of that will start to happen in layer twos. It is incredibly bullish in terms of how we push this industry forward using sort of layer twos as our frontier for innovation and technology.

Starting point is 00:38:50 and they could deploy this kind of thing on a layer two, even absent the Ethereum main net supporting account abstraction. Super cool, man. Yeah, great stuff. Great stuff. All right, coming up next, the metrics behind the Trump NFT drop. I know y'all wanted to hear exactly how many newbies bought Trump NFTs. We were here for your Trump impression, David.

Starting point is 00:39:11 I got none more of that. So, Ryan, what do you think? More than 50% new buyers or more than 50% of them are NFTs? speculators. Ooh, I'm going to go with new buyers more than 50%. I think this reached an entirely new audience. I was not compelled by it, but I think others would be. Yeah, other things as well, Ren protocol is in trouble.

Starting point is 00:39:34 Wren, the bridge that puts assets on one chain across to another chain. We'll talk about that. And also, finance bailout, not a bailout for Binance, but finance bailing somebody out who is getting bailed out by Binance. All of this and more right after we talked to some fantastic sponsors to help you 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

Starting point is 00:40:00 onboarding your users will ever experience, and comes with all the features users need to feel empowered in the Web3 world. Multi-Change support, NFT display, and users can buy SFTs, NFTs, and crypto directly with a credit or debit card. For developers, Sequence is the plug-and-play platform for Web3 games and apps. Their APIs let you bring NFTs, SFTs, S&E, and apps. FTs and tokens into your game or application. And a Sequence relayer enables gaseous transactions for your users.

Starting point is 00:40:26 Sequence already power some of the best Web3 games like Skyweaver, NFT projects like CoolCats, and marketplaces like NiftySwap. And Sequence is compatible with all the EVM chains, including Ethereum, Polygon, Binance Smart Chain, arbitram, optimism, and avalanche. So go to Sequence. com. To start building or speak with the Sequence team today. If you've been listening to Bankless, you know that we're fans of the modular blockchain thesis.

Starting point is 00:40:49 The idea that blockchains will separate execution from data availability and consensus, allowing all three to become the best versions of themselves. And Fuel has built the fastest modular execution layer in the industry. By supporting parallel transaction execution, fuel unlocks significantly faster throughput for the Web Free world. Fuel also goes beyond the limitations of the EVM, with its own Fuel VM, which is more efficient and optimized, opening up the design space for developers. And lastly, fuel brings a powerful developer experience with its own domain space. specific language sway and a supportive tool chain called fork. With fuel, you can have the benefits

Starting point is 00:41:24 of smart contract languages like solidity while adopting the improvements made by the rust tooling ecosystem, letting the fuel development environment go beyond the limitations of the EVM. If you want to learn more, there's a link in the show notes to see how you can get involved with a fuel network. It was recently announced that Moon Pay, the onramp, is now integrated directly into the Uniswap front end. So you can now buy tokens on Uniswap directly through Uniswap, using, moon pay, that's got to be one of the fastest on ramps into Ethereum that I can think of. Direct to Uniswap, just straight into the shit coins, you know? Well, you don't have to.

Starting point is 00:42:01 That's a choice. Look, there is great personal responsibility when it comes to crypto, because you can literally buy anything on Uniswap, and it's completely up to you. But this is really cool. This is a screenshot of how it looks, and you could see this is fully integrated into the Uniswap app, where you could just buy crypto directly from. uniswap. So save a step in the process and not have to transfer through an exchange. I wonder if we're going to see PayPal there. I would imagine. So I mean, there's probably all

Starting point is 00:42:29 sorts of different. On ramps are a big deal, like a big, freaking deal. And it's cool to see some of these larger companies getting in the game there. But David, what's going on with Ren Protocol? First of all, what is Ren Protocol? Because it's been a while since I've heard that name, actually. And last I recall, it was like some sort of a cross-chain asset bridge. of some sort. So if I wanted my ETH on, well, if I wanted my Bitcoin on ETH, I could use Ren in order to get there somehow. Yeah, that's exactly right. Yeah. So RenBTC is a token that you could buy on Unoswap. However, with this news, I wouldn't suggest it in this present moment. But it was basically this, think of this like a, just like a mesh layer between many, many, many chains,

Starting point is 00:43:11 a very ambitious project. It's like a mesh layer between many chains that had its own token called Ren. And Ren was the asset that economically secured. all of the cross-chain transfers of assets. So it was like a bridge, but a hyperlinked bridge across all the blockchains. At least that's what the vision was. It was actually bought by Alameda back in February, shortly after being bought by Alameda, started supporting Solana because in hindsight, now we know that we need to do everything we need to do to prop up the price of soul because that's what Sam was using as collateral.

Starting point is 00:43:42 But I digress. Anyways, now that Alameda bought Ren and then is now defunct, there's no more funding for REN. And so according to this article, Alameda was contributing $700,000 per quarter to keep the REN operation going. And during a community called last month, REN revealed that it only had $160,000 left in funding, only enough cash to get down to the end of the year. And so there's probably further details about what this means. If you are a holder of REN tokens, so click that link in the show notes, to go dive down that. Rebbehold to see what you need to do.

Starting point is 00:44:20 But the Wren 1.0 network is shutting down. And they are saying that compatibility between Wren 1.0 and 2.0 cannot be guaranteed. So if you are a holder of Wren 1.0 assets, you should probably do something by something I mean like go back to port your ren tokens back to their native assets. So definitely pay attention to that

Starting point is 00:44:42 if you are a holder of any ren tokens. I've never been a huge fan of this sort of bridging personally. I've never gotten into it. Like, I'm glad that it's, that it's there as an option, but also, like, not glad because I think it provides a false sense of security, because really the security of that REN Bitcoin on ETH is kind of backed by the value of ren, the token itself. Yeah. And it was always unclear.

Starting point is 00:45:03 And the security of the protocol, too, which is also unknown. Yeah. I'm not particularly bullish these types of bridging solutions, much more bullish kind of layer twos and trustless bridges. They seem to be a very seasonal thing, because I remember this being a, topic of conversation during the height of the last bull market like during the last prooperability it's always a meme and it seems to be like one of these things that gets a lot of funding during the bull markets and starts to work during the bull markets and then breaks

Starting point is 00:45:32 during the bear markets every single time however i will say that ren actually did stick around throughout last bear market it has been around us for two cycles um perhaps no longer yeah perhaps no longer let's talk about eith global what's happening in 2023 like all around the world there's 18 different hackathons, is that right? Yeah, so many, so many. Yeah, so many. Yeah, so many. So, ETH Global released their big 2020-3 schedule. So if you are a developer who is at hackathon, a tendor, here we go. Scaling Ethereum in March, ETH Global, Tokyo in April, East Global, Istanbul, and May, ETH Global, Toronto in June, Paris in July, that's right after ECCC, New York in September, I'll probably be there. And then ETH online in October,

Starting point is 00:46:11 and then ETH Global at DevCon sometime in 2024. So if you are a hackathon atendor, Their schedule is out. So mark your calendars for 2023. Build market. That's what we're doing here. We're building. DevCon, has that location been announced yet, David? No, no, it has not.

Starting point is 00:46:28 Okay. We'll have to see. I'm waited with bated breath. All right, let's talk about those Trump NFTs, baby. Trump made, did you know this? I don't know about your 50% question earlier, but I do know he made about 6.7 million on NFTs last week. And I also know, David, for Trump.

Starting point is 00:46:45 That means he ain't leaving. He's here to stay. Trump NFT dropped in 2.0 coming very soon. I mean, I should mention all of that money probably didn't go directly into Trump's pocket. I'm sure this was some sort of licensing deal where some third party was doing this on his behalf. But you know he got a sizable cut using his likeness and the Trump brand and his face and his musly chiseled body on some of these NFTs that had to come with the cost. So give us the stats. What is the case?

Starting point is 00:47:15 Is it, are a bunch of new NFT users in these Trump NFTs? Or are these, the same old DGens that are now like aping into Trump NFTs and dumping them? Yeah. So ZeroX, Sydney put together a fantastic thread detailing some of these metrics. So about 15,000.8 total holders and about 65% of that, about 10,000 wallets only hold one card. So that's a pretty good distribution, I'd say. Yeah, so like skipping down to, let's go down to... Wait, one second, you know, the largest whale is, oh, is the team and they have a thousand cards.

Starting point is 00:47:51 I thought somebody bought a thousand. The second largest holder has 329 cards. All purchased from the secondary market. They didn't even mint it. Wow. Wow. And like this particular person who bought 329 cards on the secondary has transactions in their wallet that goes back to 500 days ago, both on Polygon and on Ethereum. So this is not a new.

Starting point is 00:48:11 It was Donald Trump, Jr. He bought those. The person that paid for the highest sale was a whopping 37 Eth, and they owned 24 Trump cards, all purchased from secondaries. Wow. Paid a total of 72 Eth across the entire collection. Wow. $84,000.

Starting point is 00:48:30 Yeah. Okay. So doing okay. About 9.7,000 holders do not hold any Matic or ether, which means that they are likely a first-time NFT purchaser that probably paid with a credit card. So that is our assumption of these are all first-time crypto users. 9.7,000 people bought one Trump card, and they don't have any ether ormatic in their wallet. It means they don't have any gas to pay to transfer those things.

Starting point is 00:48:55 So if you do the math, 9.7 are crypto nobs. 12.8 total minted the collection. So that brings us to a whopping 76% of new crypto users because of the Trump NFT. Wow. Wow. Okay. So what do we do here? More private keys and more hands is net good thing, right? More NFD use. That's what we say. Net good. Trump is onboarding people to crypto. Look at the floor price of these things right now. It's a point two three at the time of reporting. Point two three for 45,000 units? Is that really true? Forty-five thousand items, yes. Yeah, at 0.23, almost a quarter of an eath. What the absolute F, dude.

Starting point is 00:49:43 That is insane. I don't think I've paid much attention to these things. It's basically pictures of Trump. That's $276 for a floor NFT, and the minimum price was $100. It does not appear to me like a lot of time went into these things. It's just Trump. No, this is one picture of Trump with different things photoshopped on him. There is only one photo of Trump.

Starting point is 00:50:08 The entire collection is just one Trump photo. It's just one Trump photo. And then he has different backgrounds, different suits, different bodies, different hats. But it's just one Trump photo. Look, I am not a NFTE-o-oficionado, but I might call this a low-effort NFT, David. I don't know your take on it. They made 45,000 of them. That's a lot of quantity.

Starting point is 00:50:32 I don't know about the quality, though. I teach their own, though. One stance, one photo of Trump. It's just a JPEG. You're buying the JPEG. I hope everyone knows. And I guess getting onboarded into the Polygon Network as a result. I wonder how many of those users actually learned how to use MetaMask through this, for example.

Starting point is 00:50:50 It must have been a lot. Oh, this was funny. Did you see this tweet thread? So this was a tweet thread because there was one photo, right? So like where did they get all the bodies? And so apparently these are all like shutter stock images that they just like pulled off of the shutterstock image and then slapped it onto Trump's and like, edit it for a little bit. And like there's so many examples of these of like where they got the tuxedo for Trump and then they just slapped it on there. It's just the most on brand thing

Starting point is 00:51:16 I can think of for Trump. Just like one Trump photo like 10,000 like shutter stock stock images just slapped on there. And they they for a Photoshop job. And crushing it. They look pretty good and also crushing it. Yeah. I also like crushing it in terms of volume and sales. Yeah. Amazing there. All right. Trump is here. So is Reddit of course. Reddit, they just launched another free NFT collection. They've been crushing it toward the end of this year. Five days ago is called the Recap 2022. This was free, but already David has 1.3 million owners.

Starting point is 00:51:51 They call these not NFTs in the Reddit ecosystem. They call them digital collectibles. And the community is definitely collecting them. 1.3 million owners of this thing. This is all happening behind the scenes. I think that's pretty amazing as well. Yeah, and mainly I don't think, I would say the majority of these people don't know that they're NFTs because like there's no trading volume on these things. They're not they're not

Starting point is 00:52:11 getting like transferred around. Right. Here is a graph from Hildobby and this is a maybe a sobering graph of some of the NFT market from 2022. What are we looking at here? Yeah. So this is wash trading on Ethereum. Ethereum NFT wash trading volume and there was basically zero wash trading up until about I think like the start of this year maybe like January of 2022. And, you know, I mean, you said sobering, but also, Ryan, remember, this is when looks rare launched and looks rare and incentivized. Token incensed, washing trading, basically. Trading in general, which created wash trading. And what is wash trading for people who don't have a crisp definition of that?

Starting point is 00:52:53 It's when you, like, buy and sell an NFT immediately. And so perhaps you do that from one wallet to another. You do it to a friend. You just do fake trade. It's not a real trade. You fake a trade. And why would you do this? A whole number of reasons.

Starting point is 00:53:08 For looks rare, it's to earn looks tokens because you were paid for volume on looks rare. You can also do it to launder money, if that's your vibe. Don't suggest it. You can also do it to do tax locks harvesting as well. There's plenty of ways. There's plenty of reason to wash an NFT trade. Some legitimate, some not legitimate. Yeah.

Starting point is 00:53:30 So this graphic is showing a lot of the volume. This is a 44% of the volume. volume traded in all of 2022 was washed traded? Yeah, looks like it. Yeah, it was definitely concentrated in the middle of the height of the mania. It's definitely come down now. But wash trading is probably going to be a thing that is just, I'm not going to say plagues because, again, it's not inherently negative, but it's going to be something

Starting point is 00:53:55 that's like always going to be a part of the NFT industry. I love that you can see this all on chain, though, right? And this is sort of a citizen journalist type, Hill Dobby, who's constantly coming up these fantastic analytics master yeah yeah he's just crazy at this um christie's down kind of bad from an nfts perspective at least from those 2022 highs uh they their sales christie's nfts sales fell 96 percent in 2022 not unexpected um but when you look at these numbers david uh art auction house christie sold 87 nfts for a total of 5.9 million in 2022 and that was down 96% compared to 2021. So must have been hundreds of millions previously. Yeah, 150 million in

Starting point is 00:54:44 2021. So a down year for Christie's from that perspective. Yeah, I just don't think anyone's surprised by this. And also, Christie's continues to make investments and efforts into building out like virtual auction houses for NFTs for moving forward. So I don't, even though they're down, I think they are still bullish. Look, they're so psyched about the new growth, like opportunity that they didn't previously have, and now we have digital art. Let's talk about some more digital art that's coming, a digital book collectible. This is the last in a series of five. We are calling the Genesis Collection, where you can get an NFT of five of our favorite

Starting point is 00:55:20 bankless podcast. And this is the original collection. There's only going to be five of these. The last one is getting issued tomorrow. And the last one is another one of my favorite episodes of all time. David, what are we releasing tomorrow? The fifth of five of the Genesis collection is, of course, none other than Fatalic Buteran. Who else could it be?

Starting point is 00:55:40 And we are going to tokenize episode 99, end the game, which I think was a fantastic episode about the long-term philosophy of the Ethereum roadmap, and not just the technical details, but why it is what it is. So if you want to collect the Ethereum roadmap as a podcast with Vitalik Buteran, that is available at collectibles.bankless.com at noon. Eastern time on Friday tomorrow. Well, today, if you're listening to this tomorrow, Friday. Sorry about that. It's today. It's the 23rd of December, 12 p.m. Eastern. You can pick that up. And the previous ones have gone fast. Like the Drake one. Three blocks. They're sold out three blocks. Yeah.

Starting point is 00:56:23 All right. Let's talk Bitcoin stuff. And I guess the story around Bitcoin right now is a bunch of Bitcoin miners going bankrupt or on the verge of bankruptcy. What's this one, David? Yeah, Core Scientific, which one of the bigger Bitcoin miners out there, has filed for Chapter 11 bankruptcy protection. It's one of the largest publicly traded mining firms still generating positive cash flow, but just not enough to pay back the debts that it owes. And so when energy prices go up, which energy prices are up big right now, and also Bitcoin prices go down, Ryan, that is bad for the mining industry. That is not what you want. And so, of course, scientific estimated assets and liabilities

Starting point is 00:57:00 is at between $1 and $10 billion, $1 billion for assets, $10 billion of liabilities, and has between one and $5,000 creditors per its filing. Well, here's the thing, David, is this always ends up leading to consolidation, doesn't it?

Starting point is 00:57:16 Because who's going to buy these assets? A stronger, healthier Bitcoin mining company that was able to weather this storm, they're going to end up purchasing these assets. And so the big fish get bigger. And kind of the smaller weak fish get weeded out and they die. And then you get increasing consolidation. That's always been my take as well.

Starting point is 00:57:37 The destruction of Bitcoin miners at the bottom of the bear always leads to consolidation. When I gave this, that take to Bitcoiners, they say, well, actually, the biggest fish dissolve and a lot of the cheaper fish, smaller fish, get to buy up discounted mining equipment. So that was their retort to that. I don't know that that practically happens just because the economies of scale and the risks to launch it, like injecting enough capital to launch something like this are so large these days in particular. Like you have to have a lot of capital in order to inject this. It makes sense to me. The Bitcoin take on this is interesting about proof of work is that it's a free market anyone can enter. But actually, I find staking much more compelling from that perspective.

Starting point is 00:58:22 It's a solo staker is never going to have to go bankrupt and go out of business, are they? You don't need to invest to get ahead of your competition. You just put Ether into your validator. It's interesting. I think more might be ahead as they weather this storm. But let's talk about Binance. Maybe Binance is doing the thing that FDX could not, which is actually purchasing Voyager and helping to bail out some of the Voyager depositors.

Starting point is 00:58:48 Refresh us. Who is Voyager again? And so what's the story there and what's Binance doing? Yeah, Voyager is the digital currency exchange that gave a $660 million unsecured loan to Three Aeros Capital, who vaporized that loan and was unable to pay Voyager back, which caused Voyager to go into bankruptcy. And now Binance, U.S. is now looking to acquire. Oh, but no, not before Alameda attempted to bail out Voyager. So Alameda gave, I think, Voyager like a $250 million line of revolving line of credit to maintain liquidity. And then Alameda went bust.

Starting point is 00:59:27 And so here we are. Now, Binance US has won a $1.02 billion bid to buy Voyager digital in all of their distressed assets. And so this is looking like this is going to happen. So cool, I guess. This is some light at the end of the tunnel for anyone who had assets inside a Voyager. You might be able to get your money back as a result of this. Are we worried about this, though?

Starting point is 00:59:51 Is this like, I mean, I'm feeling a little bit of deja vu. a big crypto banker steps in, not SBF this time, it's CZ going and buying the assets. I just, it feels kind of similar to a recent pattern. Yeah. Is CZ different than SBF, though? That's the root question. Is it, is it ridiculous for me to say, like, let's just give CZ the benefit of the doubt? I don't know.

Starting point is 01:00:13 He made it through two market cycles. He's doing the main character thing right now, which is a little bit concerning. But, like, I don't know. He hasn't indicated anything that Binance is completely. Like, Binance is above board as far as I can tell. That's the thing. That's the end statement is as far as we can tell. And we don't know for sure.

Starting point is 01:00:33 But I guess the other option for Voyager was what? Complete Chapter 11 bankruptcy. Go bust your death. So this has got to be at least better than that. This is a lifeline. This is some hope. So we'll see if Binance and CZ can pull this off. This is a take, David.

Starting point is 01:00:49 I saw this week. So this is the Senate Banking chairman says, when asked about banning cryptocurrency. Maybe, could be a good idea. Not too sure. Here's a quote from him. Maybe banning it. Although banning it is very difficult

Starting point is 01:01:03 because it will go offshore and who knows how that will work. Some of the senator-type conversation is absolutely maddening to me. A message to Sherard Brown. You said banning it would be very difficult because it will go offshore. Let me give you another reason

Starting point is 01:01:18 why it's going to be difficult. It's going to be difficult because we will fight you the entire time. These are our digital property rights, Senator Brown. These are important. This is not only difficult because it will go offshore. It's difficult because this is a breach of our constitutional rights to own these sorts of assets and to preserve our privacy. So I think- Also, I got news for you, Senator Brown. It's already offshore. If you ban it here, you're just banning your own citizens from accessing something that already exists. It's not going to go offshore.

Starting point is 01:01:52 it's already, it's on the internet, bro. I think some of this is posturing, similar to the kind of Senator Warren. I think some of this thing is just being uneducated about how this works. Maybe we'll ban crypto because I'm a regulator and I can do whatever the hell I want. I'll just ban that. Oh, you like that? I'll ban it. No, bro.

Starting point is 01:02:10 Like, it's not how it works. Yeah. Anyway, this would obviously be challenged in court. There would be a lot of reasons why crypto is going to be difficult to ban, including, as he rightly points out, that it would be completely ineffective and counterproductive. So let's hope logic holds as we get into 2020. My God. David, jobs time.

Starting point is 01:02:27 This might be the last time we tell you in 2022 that you should get a job in crypto. Even now, even during the bear market, it's a good time to work in crypto for companies that are hiring. I'm going to read out the jobs on the jobs board. Heath and Bitcoin denominated salaries are at all-time highs right now. Silver lining. I love it. Alchemy is hiring a backend engineer, uniswap labs. They need a senior front-end engineer diagram ventures.

Starting point is 01:02:51 needs an associate for crypto venture creation. Rabbit hole, business operations person, diagram ventures is continuing to hire two, I guess, crypto venture creation specialists. Maker Dow needs illegal counsel. I could go on, but I don't have to because these are posted on bankless.pallet.com slash jobs, and you can get a job in crypto and start 2023 off right. All right, David, what do we got coming up next? Coming up next, we got some hot takes from crypto Twitter, and then Ryan and I take some time to shit on Wells Fargo because, you know, it's the end of the year. You got it. You got it. Punch him on the way out. And then of course, we got the meme of the week. So all of that and more.

Starting point is 01:03:28 First, though, we have to talk to some of these fantastic sponsors to help you go bankless. Arbitrum 1 is pioneering the world of secure Ethereum scalability and is continuing to accelerate the Web 3 landscape. Hundreds of projects have already deployed on Arbitrum 1, producing flourishing defy and NFT ecosystems. With a recent addition of Arbitrum Nova, gaming and social DAPs like Reddit are also now calling Arbitrum home. Both Arbitrum 1 and Nova leverage the security and decentralization of Ethereum and provide a builder experience that's intuitive, familiar, and fully EVM compatible. On Arbitrum, both builders and users will experience faster transaction speeds with significantly lower gas fees. With Arbitrum's recent migration to Arbitram Nitro, it's also now 10 times

Starting point is 01:04:11 faster than before. Visit Arbitrum.io, where you can join the community, dive into the developer docks, bridge your assets, and start building your first app. With Arbitrum, experience Web3 development the way it was meant to be. Secure, fast, cheap, and friction-free. The Brave Wallet is your secure, multi-chain on-ramp into Web3, and it's built directly into the Brave Privacy Browse. Gone are the days of managing multiple wallet extensions that put you at risk of fishing, spoofs, and tracking. With the Brave Wallet, you can securely manage your crypto assets across more than 100 different chains, including Ethereum, Layer 2s, Solana, and more. All without your own. downloading risky extensions. The Brave wallet is easy to set up and removes the headache of

Starting point is 01:04:50 jumping between wallets and extensions. It's lightweight but packed with great features, like built-in token swaps, buying and holding NFTs with a gallery view, and support for hardware wallets. But also much more than that, because Brave is shipping new features every single month, with a mission to make Web3 easier to navigate for its over 55 million users. Wallet extensions are a thing of the past. So get started with Graves' Web3 ready browser today and experience a decentralized web seamlessly without all the clutter. You download the Google, browser at brave.com slash bank list and click the wall icon to get started. Here's a tweet that I saw this week, Ryan, which documents the penalties that Wells Fargo has accrued since 2012. In 2012,

Starting point is 01:05:29 5.3 billion paid for mortgage abuses. In 2013, 1.9 billion paid for banking violations. In 2018, 2 billion was paid for toxic securities abuses. In 2020, 3 billion was paid for fraud. And in 2022, just recently, $3.7 billion was paid for customer abuses. These are all collective penalties that Wells Fargo has paid. And I was doing a little bit of a deep dive just to fact-check this.

Starting point is 01:05:56 You know how many billions of dollars Wells Fargo has paid since 2000 in penalties? Ryan? I bet we're in double digits here. We are at $20 billion of penalties paid by Wells Fargo since 2020. And I just really want to drive two more points home on this. Wait, since

Starting point is 01:06:14 two thousand. Excuse me since 2000 since 2000 since 2000. Okay. One it's it with the 20 billion dollars that they paid since 2000 is just a fraction of the money that they made because they keep on doing it. Yeah. So like they made more money that it's these are all slaps on the wrist. So think about all of the shady ways that they made money and how much money you think that they made when they only paid 20 billion dollars. So that's the first point I want to drive home. Second point is you don't get caught the first time you do something. And so like, we actually don't know what they, these are just the things that we know about. These are the things that they've just been caught for. And so like, they were fined $3.7 billion in 2022 for customer abuses. I'm going to go ahead and

Starting point is 01:06:58 guess. They've been abusing customers the whole time. I'm going to go ahead and guess that that's the goddamn business model of the goddamn company. And it's just happened to be that in 2022, the, the nation state said, hey, you're doing things a little bit shady. Pay us three $1.7 billion to continue and we'll keep and we'll just find you a few more billion dollars in a few years. We look good. You know, you're paying it back. You still get to farm your, yield farm your customers. Yeah, absolutely insane. Do you know what's crazy about this too? As I look at this rap sheet, you know, a 5.3 billion in 2012, 1.9 billion in 2013, 2 billion in 2018. I mean, this is a repeat offender, David. Yeah. It's not like they're learning their lesson. It's just they just change what they're calling

Starting point is 01:07:42 their the offense. Mortgage abuses, banking violations. Toxic security abuses, fraud, customer abuses, those could all be the same thing. How does this link to going bankless? All right. It's just like banks suck. We know from a U.S. perspective. They're also preying on their customers, it seems like, with kind of a rent-seeking,

Starting point is 01:08:03 in many ways, toxic business model. Bankless has always been about using less banks over time. By the way, somebody, somebody, over the weekend on Twitter, tried to nail us and get us with the gotcha, which is basically like, David and Ryan, are you guys even bankless anyway, or do you secretly have bank accounts? Do you think my 82-year-old landlord accepts Ethereum? No. It does not. We don't secretly have bank accounts. We publicly have bank accounts. We've talked about this forever. Yes, we want to have less bank accounts over time. And every year, a benchmark for me, David, since I've been on this

Starting point is 01:08:39 crypto journey is like is more of my net worth outside of banks than inside of banks, number one. And am I using crypto money systems more than I'm using my Wells Fargo account? I like literally have a Wells Fargo account that I'm stuck with because I have to pay bills in real life. All right? And every single year that those two metrics have gone up in that I have been more bankless this year than I was in the previous year. And that's what this journey is about.

Starting point is 01:09:07 because look, these predatory practices, this kind of landlord rent-seeking middleman type of behavior that most of the time goes unchecked, we can solve this at the protocol level. How? Everybody owns their own money. We don't require the banks to give us permission

Starting point is 01:09:28 to withdraw money from an account. We can have a smart contract wallet with a circle of social recovery, a small set of friends and family that I trust to help me recover my keys. I can use defy rather than use the traditional banking system. That's why we're on this journey,

Starting point is 01:09:44 so Wells Fargo can't screw us any longer. Nice rant. That's great. It's really just a matter of just like, my Wells Fargo account is like gathering dust. And you know how I know this? I have to reset my password every time I log in because I always forget it.

Starting point is 01:10:00 Then I got a password manager, and now I don't have to do that anymore. Have you actually gone in person to Wells Fargo this year? I remember we used to do that. Not this year. No, not this year. Our banks. Oh, no, I did because I needed to get quarters.

Starting point is 01:10:13 Remember we used to do like bankless paychecks with like actual physical checks. Right. Yeah. To like show up at Wells Fargo and like cash these checks with your bankless. Right. Yeah. Yeah, exactly. Yeah.

Starting point is 01:10:23 Our, our previous bank, by the way, bankless, the company, the entity was previously banked with Bank of America. And they sent us a Dear John letter and kicked us out one day. They made us bankless. community credit unions. It's ironic that, you know, we actually were made bankless. But anyway, that's Wells Fargo continuing to be great. Be great. Be really good content for this podcast, that's for sure.

Starting point is 01:10:52 So here's the associated meme with this is like, so after Wells Fargo gets violated, this pays violations. Here's my favorite SpongeBob meme, which is the SpongeBob looking at that rock. And he goes like, oh, when we see me running, this is an esoteric, punch-bub meme. He's like, he's like basically the flash. And he goes, like, want to see me go and touch that rock? Want to see me do it again? If you don't, if you didn't get this punch-bob me, then you didn't get it. I'm sorry, I'm sorry, I put you that, but whatever. Bankless fans are going crazy right now. They're wild with excitement. Just a reminder, this is from me. I actually

Starting point is 01:11:25 received a Binance account deactivation notice. Good for you. From an old Binance account that, that I had that I no longer used. This is what it looked like. Account deactivation. Deactivation notice, thank you for your support of Binance. This is to inform you that your account has been flagged by a third-party compliance tool, and we've taken a tough decision to terminate the service. You may withdraw your funds and ask that you do it before December 27. So they give me like 10 days or something. Afterward, your finance account will be permanently deactivated.

Starting point is 01:11:58 Look, this is just a PSA for us to remember that the crypto banks that we use, they can provide a fantastic service are very important, great crypto platforms, they could still deactivate your account. What is the definition of a bank is you can deactivate your account? And so this is why we are such advocates of decentralized financial systems like Ethereum. An eth address can never be deactivated. I'm never going to get an email or a message like that saying you can no longer access your private keys on Ethereum, right? That just can't happen. I have direct access to it and always will. And so that is, I think, a distinction that a lot of people learned in 2022.

Starting point is 01:12:41 And yeah, just another reminder of it when I got this account notice from finance. And then there's a, you had a critique, a critique, or Yel Zengo who said, okay, but your Ethereum wallet can be stolen, fished, lost, tricked and malicious scams. Oh, and your reply is exactly what I was going to say. Yes, those are all things that you as an individual have. control over. As somebody that has like juggled 50 wallets over the last like five years, never lost a single one, never gotten fish, never, never been tricked in a malicious scam, except for that one Iota scam. And I haven't, even though, like, I've never been stolen. So like, yes, it can

Starting point is 01:13:23 be those things, but that's because I'm in control. Like stolen, fish lost tricked and that, that could happen to your Wells Fargo, probably. Like, but that's their problem. Now, What's your problem? The only time I've actually like lost sums of money in crypto, it's actually been on crypto banks, see by lending platforms. Really? Yeah. Yeah.

Starting point is 01:13:46 Remember, like I've lost a little bit in Celsius, a little bit in BlockFi. Those are the only times I've actually lost money. So you can't lose your own money. You'll just trust somebody else to lose it for you. Great. All right, man. It's been a year, hasn't it, David? It's been a fun year.

Starting point is 01:14:05 Good in so many ways. 51 weekly roll-ups. Yeah. I'm going to do the 50 second next week, but you're going to be out. Yeah. Oh, thank you. Thank you for doing that. But let's end with this then.

Starting point is 01:14:16 What do you bullish on? And this could be this week. This could be going into 2023, whatever you're bullish on right now. Oh, I'm bullish on 2023, the whole entire year. And not just in crypto, although like when, I'll say it again, when prices are this low and when we're down this bad, like, it's kind of. like up only, hopefully. Like the upside is larger than the downside. That's for sure. Yes. But what I'm talking about in 2023 is a little bit just more like, um,

Starting point is 01:14:42 2022 was challenging for the crypto world. Also for bankless. And you know, I know you know this. Like team has grown bigly. We're doing some really ambitious things. And I've, now I'm at the point in my own personal life where like, oh, I can't just like ape into 2023 without like a plant. And so like I've got my calendar up. I was like in this month I'm doing this. In that month I'm doing that. Like I need to have this done by this month. And so like I'm just like leaning into the whole like structure thing. And I encourage other bankless listeners to do something similar. Like if you, for example, we're listening to the ETH global hackathons and you want to go to some of those, get a calendar, put them on. Also put ETH Denver on there. Put like ETHC on

Starting point is 01:15:26 there like you set up a goal a system of goals for 2023 uh because if you're going to win big in crypto it's good that's what it's going to take uh so ryan i'm bullish on 2023 being like a planned structured year for all of the crypto industry for me personally for bankless uh and hopefully we can all just like plan the end of the bull market rather than just wait for it to happen 100 i'm so bullish on on having a plan going into 2023 well you know i'm a planner so i know bullish on that. But like, that's, look, that's how you, too many people, I think, in, were just thrown by the seat of their pants and went wherever the wind that carried them in 2021 and 2022.

Starting point is 01:16:09 They didn't have a bedrock thesis for the space. They didn't have a plan for the space. They would, a foam-o into things. And, you know, during the fud times, they would sell at the bottoms. Like, that's a recipe for disaster. You just get thrown around and tossed by the wind. and you can never accomplish anything. So, yeah, I'm absolutely bullish on having a plan, too.

Starting point is 01:16:32 You know what else I'm bullish on though, David? Tell me. I am bullish on 2023 being way smarter than 2022. 2022 was just dumb. Like, it almost, and I don't want this to sound glib, but I think we have some separation on it where we could zoom out and distance ourselves from it. But 2022 really needed to happen.

Starting point is 01:16:57 Yeah. It absolutely needed to happen. There's no way we could have a successful 2023 or 2024 without 20202 happening. Crypto is now way smarter. A lot of the tourists have left. A lot of the corrupt fraudsters are out too. The shaky companies have been completely wrecked. Much of this was justified.

Starting point is 01:17:21 Some of it didn't. It wasn't, of course, but much of it was. and we're coming into 2023 way stronger, way smarter. Crypto didn't die once again. The builders are still building. And this is the underlined, ever since we started this bankless podcast.

Starting point is 01:17:37 We started this podcast because there's a recognition, I think, that you and I have that the world needs crypto more than ever. And going into 2023, it's the same thing. It's like the world needs crypto even more than when we started the podcast back in 2020. David. Yeah, big time.

Starting point is 01:17:55 It's become more critical, more necessary. And we're smarter, we're better capitalized. We have more builders in the space. We have a clear roadmap and direction for where we're going. So that's what I'm excited about is we just got a lot smarter. 2023 is going to be a fantastic year. I think it could be one of the best years for being in crypto. I don't have the hopelessness that I had in 2018, right?

Starting point is 01:18:20 I'm like, oh, we'll get through this. not a big deal. And yeah, I'm excited about it. There was like a vibe in about like 2019, I think, where it was the golden age of building in Ethereum. It's really the golden age that like so many of us during the peak of the bull market were like, man, I really want some of those quiet times to come back.

Starting point is 01:18:40 Good days. We're good days. That 2019 feels like 2023. It's like, okay, the pain's behind us. There's just building left and just signal and progress. That kind of feels like the right timing. Is this David too stupid to map it? is like 2019 is like 2023, right? 2020 is going to be 2024 analogous.

Starting point is 01:19:00 And then we're going to get another 2021. That's going to be 2025. Do you think it will like just play out pretty much exactly like that or close to that? It's just another fractal pattern. You ask if it's too stupid to do that? I think yes. And it's still going to be right. I think so too.

Starting point is 01:19:20 Like that, if you were to ask my just, you know, gun to my head prediction on how this is play, that's exactly what I would say. I would say we'll have next year where we're building, it's going to be like 2019 or just, yeah, and it'll be 2023. We'll be just, you know, builders, there'll be some chop. It'll be boring. It'll be all sideways action. We won't even get any big runups. And then 2022 will hit and we'll have a glimmer. It'll be something like identity.

Starting point is 01:19:43 No, 20204. 2024 will hit. 24 will be the bull market, but only in hindsight. You won't know it in the moment. And a small segment of people. Only the people who have stayed around will actually see the glimmers. We won't get mainstream in 2024. It'll be like 2022.

Starting point is 01:20:01 And then we'll have breakout in 2025. And we'll get back to kind of mania craziness. 2021. We'll have to tell everyone to calm down. It will all forget to sell. It'll be great. That's what I would predict. meme of the week what are we looking at david how it started sam bickman freed playing with some

Starting point is 01:20:22 magic cards sitting in front of six monitors in his gaming chair looking like you know a traitor god is how it started uh and now it's how it's going which is being escorted with you know unshaved unkempt sweaty shirt into a jail wow these two pictures sum up the beginning of of this year and the end of this year that's exactly right the top of 2022 and the bottom of 2022 well um guys bankless listeners on behalf of us to you. I hope you enjoy some time with your family. Happy holidays. David's going to be with you next week, next Friday for the roll.

Starting point is 01:20:55 Oh, I got to reach out to Anthony. Never misses a roll-up, all right? It's true. I'm going to be gone, but he's going to give you a final send-off before the new year. And we hope you enjoyed this year with bankless. We've certainly enjoyed bringing this to you, even though it's been such a crazy year. It's been a lot of fun as well. So, wrist and disclaimers, got to end like this.

Starting point is 01:21:16 None of this has been financial advice. Crypto is risky. 2022 taught us that. You could definitely lose what you put in. Some of you did. 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.

Starting point is 01:21:32 Thanks a lot. Hey, we hope you enjoyed the video. If you did, head over to Bankless HQ right now to develop your crypto investing skills and learn how to free yourself from banks and gain your financial independence. We recommend joining our daily newsletter, podcast, and community as a bankless premium subscriber to get the most out of your bankless experience. You'll get access to our market analysis, our alpha leaks, and exclusive content, and even the bankless token for airdrops, raffles, and unlocks.

Starting point is 01:22:02 If you're interested in crypto, the bankless community is where you want to be. Click the link in the description to become a bankless premium subscriber today. Also, don't forget to subscribe to the channel for in-depth interviews with industry leaders, Ask Me Anythings and weekly roll-ups, where we summarize the Week in Crypto and other fantastic content. Thanks everyone for watching and being on the journey as we build out the Bankless Nation.

Bankless - ROLLUP: SBF in the USA | Visa Ethereum Payments | Trump NFTs | Binance Buys Voyager

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.