Bankless - ROLLUP: Worldcoin Launch | New Crypto Bills | Twitter X | Layer 2 Wars

Starting point is 00:00:00 The World Coin Project is now live. It's on MayNet. The WLD. I guess it's wild. No, world. The World token is in the wild. Orbs are deployed. And the crypto community absolutely hates it. Bankless Nation, it is the last Friday of July. That means it's the last weekly roll-up of July. Well, I spoiled it. But what time is it, David? Oh, Ryan, it's the Bankless Friday Weekly Roll-up where we cover the entire weekly news in crypto, which is always, an ambitious endeavor, especially this week. This one's going to be a long one, so we're going to try to move fast. Yet we persevere into the frontier. Nonetheless, this time quickly. I have no coffee this time, but I'm sure you do. Yeah, I always have coffee. Always. Never doubt. Why don't

Starting point is 00:00:48 you have coffee? Do they not have coffee in Switzerland? They do have coffee in Switzerland. I choose to not drink coffee at 641 p.m. It's late where you are, huh? It is late. Tomorrow, you climb in a mountain. You climb the mountain? Yes, yes. Climbing Mount Pollux, which is a training mountain, and we come back and rest, and then we climb Matterhorn the next day. Jeez, man.

Starting point is 00:01:09 Well, we'll be cheering on. If I opened up these windows behind me, you would see the Matterhorn. We've got a lot to talk about this week. Mountains aside. We've got a mountain of content to climb here. So number one, World Coin just launched, and most people love it, hate it?

Starting point is 00:01:24 Everyone loved it. Everyone loved the World Coin launch, universally beloved. launch. Everyone is so excited for it. Yeah, no, obviously not. We're going to go through the takes varying degrees of quality. Vitalik, of course, had a rational take, and then there's just a bunch of things to unpack, including the topic of WorldCoin on the bankless podcast. We were a bit of main characters. I was a bit of a main character this week since you weren't on the episode. So we'll talk about that. Yeah, you know what they say about main characters, David. We've got to avoid

Starting point is 00:01:58 that whenever possible. But we also got a main character, Crypto Bill that's in the House. The House of Representatives, that is. It's actually maybe a good one. We'll talk about that. There's also a bad bill in the Senate, so we'll contrast those two things. David, we've got to also talk about this new X thing.

Starting point is 00:02:14 Twitter has become X, and Elon wants to make it the Everything app. Does Crypto have a story in there? I don't know. I want to get your take on some of the changes that are coming down the pike. Yeah, yeah. It's a complete mess. But I continue to reserve my judgment, but we'll talk about that when we're talking about X.

Starting point is 00:02:33 Also, it's weird to call it X. It's just not going to stick. Yeah, I don't know. I'm still calling it Twitter. Also, the recession seems to be off. At least that's what Powell is saying. We'll talk about that. And also the phase of the market that we're in. Last week, we gave you permission to be bullish. This week, I feel like it's a phase of the market that starts with an A. We'll get to that in the market section. What could that be? Before we do, though, we got to tell you about our friends and sponsors over at Stater. they are building a liquid staking protocol. David, do you want to tell us about it? Yeah, Stater. It's the new LSD on the block. New LSD just dropped. And we want more LSDs. We want more decentralized staking service providers. The cool thing about Stater is that if you want to run a node with Stater, you only need for Ether. It's one of the lowest capital requirements that I've seen around. They have a pledge, of course, to self-cap if that day ever comes, that they need to implement that. Permissionless pool of staking node operators, these are the words that we like to hear. So if you want to stake your eth with stater and run a node with stator, there is a link in the show notes.

Starting point is 00:03:33 Check it out if it seems right for you. You can also get some SD token issuance on top of your eth yield if you choose to stake with stater. Check it out. There's a link in the show notes. David, let's get to the market section this week. And we've got to start with King Bitcoin over here in the Cracken Pro charge. Thanks to Cracken for allowing us to pull this up. Looking at what are the numbers for Bitcoin this week?

Starting point is 00:03:56 29,800 is where we started. 29,300 is where we ended. Lost $500 on the week. We are down 1.6%, which I call flat. That is flat in crypto. We call it flat. How about ETH price? Same same same, flat flat.

Starting point is 00:04:10 1890 to 1870, down 1% even flatter. Even flatter. Back in the 1800s, huh? All right. I don't like the 1800s. I don't like it was, yeah, it wasn't. I wasn't alive back then. It would rather 1900s and then 2000s, you know, and then we're finally into the future.

Starting point is 00:04:29 If Bitcoin ratio, is that saying anything on the week? Up half a percent to 0.064 just under. Flat. It's flat. Well, you know where the party is, David? Elsewhere. It's elsewhere. Yep.

Starting point is 00:04:40 It's not in crypto. It's over in stock land. So we are viewing the NASDAQ chart here and is creeping even higher towards all-time highs on the week. And this is really interesting to me because you contrast that with what's, the Fed is saying, flipping to our Fed watch, the Fed just raised interest rates again this week. And this is the highest level in 22 years. They increased the interest rate by 0.25%. This was sort of expected to a target range of 5.25% to 5.5%. And the question is, of course, will they raise again in September? Powell said, I would say it's certainly possible that we will raise funds again

Starting point is 00:05:21 at a September meeting if the data warranted. And I would also say it's possible that we would choose to hold steady. Anything is possible, is what Powell is saying. His comments on inflation, he said it's moderated since the middle of last year. And that's certainly what we're seeing in the data. Yes, moderated inflation. CPI is now at 4.8% when you exclude food and energy. I don't know if you should exclude food or energy.

Starting point is 00:05:48 But the Fed still seems determined to hit 2%. and still says they have a long way to go. But here was the headline news here. Powell also said that the Fed staff is no longer forecasting a recession, no longer forecasting a recession, which is very interesting. If it's not being forecasted, it's not happening. That's how recessions work. How do you take that?

Starting point is 00:06:12 I mean, the people who are saying that a recession is imminent, it hasn't hit yet. And now the Fed is saying there's not going to be a recession. A lot of different ways to take this. Recession is such a nebulous term. I like all these headlines are just grind my gears. It's two quarters of negative GDP growth. Like it has a definition.

Starting point is 00:06:31 Yeah. But the GDP measurements are poor. Inflation measurements are poor. Like recession is also something that exists in like consumer appetite and consumer confidence. Like there's so many things that go into what we're actually trying to talk about, which is like, do we have to hunker down? Or are we just, did we just like check a technical box saying we're in a recession? I was talking to one of my macro friends and they, their hot take was that we've been in a

Starting point is 00:07:00 recession. We're already in a recession. And just because the numbers that the Fed measures shows that we're not in a recession on a technical level doesn't actually like mean anything. It's so qualitative. It's so interesting though. Why would, like Powell is coming up fairly strongly in saying that they're no longer forecasting recession. He's not. Yeah, because they, want to say we stock the landing. We threaded the needle. You're welcome. We're the fed. But it would be very strange if in a quarter or two he has to eat those words and say, oops, I was wrong again. But they're the, there are the arbiters of the recession. You're just, I mean, no, they're not, but.

Starting point is 00:07:39 Jim Bianco's take, my take on the Fed hike statement in the presser so far, it provided the least amount of information of any meeting since they started hiking in March 22. Powell is going out of his way to say nothing and not commit to anything. I hate these games. I hate these games. But this is the game. Not even are we interpreting the words that they say. Now we're interpreting the lack of words.

Starting point is 00:08:05 He also added to this tweet. I spoke too soon, says Jim, this headline just caused risk markets to fall. Powell, Fed staff, no longer forecasting recession. This is how upside down we are. This is his comment on the Fed, no longer forecasting recession. The Fed no longer sees a recession is thought to be bearish for stocks because it opens the door to more hikes or higher for longer. I've often joked that stocks would make a new high if the economy unemployed enough people.

Starting point is 00:08:30 I was trying to be funny, but the market appears to be taking this idea very seriously. Seriously. I just, I don't know what's going on, to be honest, David. So the recession hasn't come yet. That's one data point. Inflation seems to be tamed. Stocks are pumping. real estate's up. Yes, bonds got a massive haircut. They got somewhat destroyed, so there's that.

Starting point is 00:08:54 Wealth inequality, of course, has continued to increase. So there's that. But it feels like a lot of the macro bears have been incorrect so far. So far. And so some of them are saying, it sounds to you like, well, just you wait. It's coming, right? We just haven't felt the wave hit us. Like, you know, there's been an earthquake in the ocean and there's a tidal wave out in the horizon. And there's a tidal wave out in the horizon. It just hasn't hit yet. We're just kind of waiting for it. But I'm kind of wondering at this point. Like, where is, why aren't stocks down? Like, here's my big question for everyone in Macro right now. How is it possible that Fed interest rates have been raised to 20 year highs and yet the stock market is also nearing all-time highs. I was told this couldn't happen, David. Right. Yeah. That is crazy,

Starting point is 00:09:42 actually. Yeah, a commenter on that tweet said, I never thought it could. Five percent inflation. would cause a depression scenario is what I thought. Yet here we are and consumers are consuming away regardless. It's kind of unreal, in my opinion. That's kind of the contrast to me. It's like the rates have been raised to 20-year highs and yet risk-on assets, aside from crypto, but risk-on assets are going back to all-time highs.

Starting point is 00:10:09 How does that make sense? Yeah, that's actually nuts. If you told us back in the start of 2022 when like everyone in the crypto industry, including myself, was getting our minds wrapped around interest rates and flows and risk assets. And then halfway through 2022, we're all pummeled. And then we're all gripping the edges of our seat saying, when's the pivot? When's the pivot? And the pivot has not come. I mean, there's been a decrease in acceleration of the raising of interest

Starting point is 00:10:34 rates, but there has been no Fed pivot, not even after the Silicon Valley banking crisis. And so after all of that, we still at Tech Stock's all-time highs. If you told us that, like in early 2022. We would that have been like, oh yeah, they did thread the needle. They got it right. Look at that. That's what I'm saying. That's what I'm saying. And I don't understand what's going on. I guess still my base case, again, what do I know about macro? Is that this is some kind of slow motion excess money printing inflationary crisis, but it's just happening so slow, like we just don't really know what the effects are. I know I would not want to be in sovereign bonds. That's for sure. I know that wealth inequality is going to increase. I have no idea what inflation is.

Starting point is 00:11:16 going to do in the future. I have no idea about a recession. And now I'm like, I'm not sure even matters. That's the thing. I don't know that it matters what Powell does in September. And that's kind of a weird place to be. I think the markets are saying that. They just have like interest rate fatigue. I guess that. So at this point, what I do is I just, I just kind of shrug, ignore macro and just keep buying crypto because I still think that in kind of this money printing world. Even when I wasn't ignoring macro, I was still buying crypto. Well, I mean, I'm going back to ignoring it. Clearly, I don't understand what's going on here.

Starting point is 00:11:53 I think the question is, where are we in the market? And I promised an A word to describe this. I call this the accumulation phase of the market. And we could see it on the chart in front of us right now. This is Bitcoin long-term holder supply, and the number is up. So Bitcoin long-term holders control 75% of the circulating supply now. And this is an all-time high. And this happens at every,

Starting point is 00:12:16 point in kind of the bare market, particularly at this phase, the accumulation phase, is the long-term holders, they're not selling, they're continuing to buy. They're continuing to pile in, right? Those with conviction are just like not only holding through it, they're actually adding to their stack. This is happening with assets like Bitcoin. This is happening with high conviction assets like ether. It's happening right now. And so what this means is these are going to be the winners on the other side of this market. Everyone who got scared, everyone who's sold low, those are the losers. Everyone who's not accumulating right now, those are going to be the losers on the other side of this market. And it just plays out like this

Starting point is 00:12:54 every single time because human psychology has not changed in 200,000 years of our history here. It's just a natural order of things. Like the short-termers come in, they buy the top, they get shook out, and then people have to sell for the next year due to collective reasons of other people losing conviction. have to sell for taxes. They have to sell for whatever. And then, like, we run out of sellers, and then people start to get okay and comfortable with where the market lands, and then sellers turn into buyers or buyers start buying. Like, the resonance between so many of the things we're talking about in the market, like stocks pumping and crypto being in an accumulation phase, that's 2019. I've seen this movie before. That's what we were doing this time four years ago.

Starting point is 00:13:41 Like, the patterns is happening once again. And four years, before 2019, they were doing it like in 2014, 2015, right? It's like, this is, this has happened before it'll happen again. I think that sometimes people tend to overcomplicate crypto investing, right? They try to focus on, like, how to win. And what I would say is, like, our years in investing in this assets, we can't tell you everything it takes to win, but I know you are going to lose if you're selling your eth and your Bitcoin, right? Like, that's the recipe for losing. I think the people who have done best in crypto, in my experience, I don't know if this applies to you, David, is just the one thing they've done consistently is they've just held.

Starting point is 00:14:24 Yeah. Like, it's as simple as that, isn't it? Let the waves wash around you. Yeah. You don't even, it's nice if you accumulate. Whenever one of my trades doesn't work, I just hold it until it does. That true for every trade. I know you bought some.

Starting point is 00:14:39 It's a surprising number of them. If you have conviction, you hold. That is the rule here. Yeah, yeah, yeah. All right, speaking of different conviction, let's talk about layer two's. So the layer two wars are, have continued to heat.

Starting point is 00:14:54 They're the hottest they've ever been. They're so spicy right now. This was something that happened this week. Optimism flipped Arbitrum in terms of daily transactions. That's the red line here. The first time that's ever happened. Yeah, flipping the blue line. And so that is a new event in the Layer 2 wars.

Starting point is 00:15:10 It doesn't mean Arbitrum's out, though. Arbitrum still has 57% of all of the layer two assets inside of Arbitrum 1. Optimism has 27%. And I know we said this a long time ago, but I want to double down on this. Layer 2 beat, this is where we're looking at all of these stats. This really is like the default,

Starting point is 00:15:31 defy pulse of like 2019 and 2020. Remember if defy pulse, we're just constantly like doing the refresh button. Defi's getting bigger. You know, it's at $200 million now. Oh, it just crossed a billion dollars now. I'm doing the same thing with L2PEN. All 20 of us that were bullish on defy when we first learned about the word,

Starting point is 00:15:50 we're all using this as like validation. This is our, it was our validation website. Now this is our layer two thesis validation website. Well, look, we've got now $10 billion in layer two. So that's about the highest it's ever been. From an activity perspective, we can plot the activity. And this line looks like it's going up.

Starting point is 00:16:06 So you could see. God, that is a great chart. Right? Look at the blue line right here, which is Ethereum. It's kind of holding steady, right? Ethereum transaction. Ethereum. Theorem transactions.

Starting point is 00:16:15 This is an activity. It's already maxed out. It's been maxed out. It's not getting any higher. But look at layer two. Look at it rise. It's just. And like, dude, that is,

Starting point is 00:16:22 that is the calm before the storm phase of that line. We're not even in the bull run. We're not even in the bull run. That line is going to increase in, what's the word, incline. That good thing is going to get steeper exponentially. Yeah. There's,

Starting point is 00:16:36 there's, I remember when your scaling factor was like 1.5. Now we're at 4.5. Yeah. I mean, I think what we're seeing on this chart is, is basically like optimistic roll-ups, which were released like, you know, two years. They have a two-year head start from ZK roll-ups.

Starting point is 00:16:50 We haven't even seen ZK roll-ups kind of enter here. ZK. ZK. Z-K. is almost at half a bill, bro. That's not a small amount. Half a bill. It's still 4%. Right?

Starting point is 00:17:01 So in order for ZK to catch up, it has to just not only like win, but like it has to outpace what the optimistic roll-ups are doing. Anyway, this is why the wars are so fun. And this is why I keep hitting refresh on layer two beat and looking at all these charts, but it's very good news for scaling Ethereum

Starting point is 00:17:16 and for the modular blockchain thesis. One thing I would like to see, I will say, is this column right here in terms of the stage of decentralization. Our best is stage one, which is still training wheels on sequencers.

Starting point is 00:17:34 They're still technically young, yes. Yes. So Arbiturum is at stage one. Optimism is still at stage zero. I would like to see the zeros become ones. I would like to see the ones become twos. That will make me feel a lot better. You would like the slices.

Starting point is 00:17:48 The slices all turn green. All those little different colored slices. We want those to turn green. That's right. Want that too. All right. Well, David, we got a lot coming up next. What are we covering?

Starting point is 00:17:57 Yep. WorldCoyne launches and everyone loves it and cheered. And then after that, we have a good bill and a bad bill. Bad bill's in the Senate. Good bill in the House. Just passed the Financial Committee vote. Jake Chravincey's got a take where he calls the vote a historic day for crypto policy.

Starting point is 00:18:12 And then after that, optimism drops the law of chains. Laws? We're getting laws. Yeah, we're getting laws. I'm super stoked about it. So all of that and more. But first I'm going to talk about some of these fantastic sponsors that make the show as possible, especially Cracken, a preferred crypto exchange for 23. If you are accumulating crypto, like we said, that you ought to be perhaps in not financial advice in the beginning of this show. Perhaps use Cracken to get that done. There's a link in the show notes to get started accumulating. Let's go hear from them right now. Cracken Pro has easily become the best crypto trading platform in the industry. The place I used to

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Starting point is 00:19:14 Introducing Polygon 2.0, the value layer for the internet. For too long, the limitations of blockchains have held back app development and stifled user adoption. The internet allows anyone to create and exchange information. What's missing is a value layer that lets anyone exchange, store, and program value. That's where Polygon 2.0 comes in. Polygon Labs has unveiled a series of innovations that will radically alter the Polygon ecosystem and Web3 as a whole.

Starting point is 00:19:38 By leveraging groundbreaking ZK innovations, such as Polygon ZK EVM, the next iteration of the best-in-classed Plonkey 2 proving system, and a first of its kind, ZK-powered interoperability layer, Polygon 2.0 will give users and devs, unlimited scalability and unified liquidity. Right now, there is a Polygon improvement proposal regarding a potential ZK-powered upgrade of Polygon proof-of-stake. If approved, Polygon proof-of-stake would become a layer 2, ZKEVM, validity. So make your voice heard on this proposal by joining the Polygon Discord today. have a chance to help the Polygon community give the internet the value layer it deserves. The World Coin Project is now live. It's on MayNet. The WLD. I guess it's wild. No, world. The World token is in the wild. Orbs are deployed and the crypto community absolutely hates it. David, they don't love it. They despises it. They really hate this. It's the least

Starting point is 00:20:30 favorite thing that they've ever seen. We're going to talk about all of that. First, I want to show you this. So Sam Altman tweeted this out. This is a picture. He says, I'll read the caption in a second, but you see this line kind of forming. I don't know where this is. It looks like possibly summer in Japan. This massive line has formed. And the caption from Sam Altman is day three of World Coin Launch, crazy lines around the world, one person getting verified every eight seconds now. David, there is one person. Okay, so why are people scanning their eyeballs? Because do you get, if I understand it correctly, you get 25 world for just doing it and then one world a week then from the rest of time world coin is two dollars right now

Starting point is 00:21:13 so you're people are waiting in line for 50 dollars what's going on why i'm doing that 50 50 dollars right now but like i guess number could go up um and sam calls one person every eight seconds i don't think numbers gonna go up at this valuation i mean we'll talk about uh more of that but can you before we get into that can you just describe what is world coin for people who've kind of missed uh what this launch actually is and even what this project is Okay, so WorldCoin is an attempt at a proof of humanity system that uses biometric scanning. So there is a bunch of different mechanisms that one could approach to try and produce a system that proves unique humanness. So this is an anti-civil platform.

Starting point is 00:21:56 We've had a number of these come into the crypto world with varying success. Circles from Martin Koppelman is one. Bright ID is one. There's a few others. Gitcoin uses a collection of them. this one is unique in that it attempts those are the ones I just listed are like circles of trust as in like other humans verifying other humans this one is different in that it is biometric scanning which is another way to prove unique humanness that also gives people the hebi-jeebies and so there's

Starting point is 00:22:25 three parts of the world coin system there is world ID which is what you get after you scan your eyeball there is the orb which is what we're looking at on screen here which is this device produced by World Coin, which also has aspirations to be able to be produced by any manufacturer that actually does the eyeball scanning and attestation that that eyeball is the same eyeball that is hard to scan prior. There is the World Token, the World Coin, which is the coin that comes with this network. There also is the World Layer 2, which is an OP stack layer 2 that got released not too long ago. And there is also an app, but I think that's also the World ID. this web, this mobile app that is your at a station for wherever you go on the internet saying,

Starting point is 00:23:10 hey, I'm a real human. So you could imagine it like sign in with Facebook, sign in with Google, sign in with Twitter, sign in with WorldCoin, except that mechanism would be kind of cool because the sign in with WorldCorn button would be a provable human. At least that's the idea. And then also the WorldCoin aspect of this is also supposed to be some UBI attempt. So every human gets an equal amount of world coins distributed them to their unique eyeball. Their unique eyeball. Their unique eyeball. Yeah.

Starting point is 00:23:42 And so in addition to all of the proof of humanness, it is also an attempt at fairly distributing a token equally across all humans, across the whole entire world. And that's how I would summarize this. And Sam Altman's part of his reason for this is like, AI is going to take all the human beings jobs, basically. And so we need to know who all the humans are,

Starting point is 00:24:01 we can give them some form of UBI basically, right? And, you know, not have just the robots kind of rule the planet and accrue all of the capital. That is his stated vision for this. And Sam Altman is one of the founders of this, actually. So, I mean, the project. He's the guy that found Alex Blania, the CEO. Sam Altman found Alex Blanio, is like, yo, drop out of school and help me build this

Starting point is 00:24:29 WorldCoin thing because I'm busy building open AI. the vision guy. Let's talk about it. So this went to main net. It had been in some sort of alpha version. It wasn't live. People were being orbed, but in kind of limited capacities. But now it's, now it's live. Now it's everywhere. This is the World Coin itself. So market cap right now, fully diluted valuation of $21 billion. I didn't realize it was so high. That is nuts. WLD token trading at $2.15 at this point in time. But a massive amount of the supply is like locked up. The circulating supply is just like a small,

Starting point is 00:25:05 it's like 1%. It's like 1%. So the actual market cap, in terms of circulating market cap, is $239 million, but fully diluted, it's $21 billion, which is an absolutely insane valuation.

Starting point is 00:25:20 I mean, what does that, I guess, like if you go to coin, it puts it at right above Lido-staked ether and right below USDC coming in, it would be number seven. It would bump Lido. Wow. It would be number seven. Lido, steak, eth. Yeah, it would be number seven. Wow. Yeah, that's extremely, extremely inflated. That is one of the most inflated token launches that I have ever seen.

Starting point is 00:25:44 This is not a layer one, we should say. This is sort of deployed on optimism change. It's like kind of a roll-up. An op. It's a, it, oh, yeah. I think that's right. It is on optimism main net and it has aspirations and it will eventually become its own OP stack chain. One other thing that I didn't mention about the whole iris scanning thing is that they also say that they preserve your privacy by doing a ZK. Snark. So they're not creating a database. If it's like, here's Ryan Sean Adams. Here's Ryan Sean Adams eyeball. They're claiming to ZK. snark that and to maintain privacy. Claiming is a keyword here, I think. So let's talk about the community reaction here. I thought one of the most rational takes, as usual, is from Vitalik. And he wrote an entire post. about biometric proof of personhood that really focuses in on WorldCoin. What's kind of your summary of Vitalik's post year, David?

Starting point is 00:26:40 I think this isn't a direct summary, but I think my takeaway from this is that Vitalik goes through all of these different components of what makes a biometric proof of personhood system and then kind of explains, well, this is how this works and this is how it leaks. And this is how this works

Starting point is 00:26:56 and this is how this is vulnerable. And this is how this is vulnerable. So you get to the end of the end, this thing. I'm like, hmm, there's a lot of like things that really need to go right for the system to work. And so he just, he just kind of talked about every single aspect of it and talked about the ways that it's vulnerable. And after you get to the end and you're kind of like, well, that's, that was a lot of things. And so that's why in the intro to the bankless podcast episode that I did with Sam and Alex, I called it like one of the most ambitious crypto projects. And people

Starting point is 00:27:23 did not like that phrasing. But they're not, I didn't do it. I didn't serve that up very well. I mean, it's like, it has to do so much to work. And the scale and scope of the thing is massive. And the requirements of getting this thing right are huge. That's what I meant by ambitious. Yeah, it has to get a lot of things right in order for this to actually be a public good for the world. If it even can be a public good. Yeah, this whole post from Vitalik, I can't recommend it enough if you have, you know,

Starting point is 00:27:50 it's probably 20 to 30 minutes of time to actually read through it. But Vitalik starts by. You'll learn a lot. Yeah, you'll learn a lot. He starts by talking about why a decentralized proof of personhood solution is even necessary. Why do we need the idea of decentralized people? Why do we need to know whether an Ethereum address is represented by one single person or many people or a bot? The reasons he give is that it's an anti-concentration of power sort of thing. If we want to do like a vote in a Dow and specify that as one person, one vote.

Starting point is 00:28:22 If we want to do an airdrop and ignore all the bots, ignore all the bots, ignore all of kind of the civil attacks and all of the airdrop farmers who are creating multiple accounts and just distribute it to individual people. If we want to do some sort of credit system, like an on-off-chain credit type system for individual human beings, we need some sort of proof of personhood. So that is a good thing in itself if we can somehow manage that on-chain. But then he walks through this one specific implementation of proof of person. which WorldCoin is pursuing, which is biometric proof of personhood. And the exact implementation WorldCoin is pursuing is eyeball-based biometric proof of personhood, which presents its own

Starting point is 00:29:09 problems. But this kind of table at the end of his post, I think, sums it up. If you want decentralized proof of personhood, you kind of have two tries at this. One is a hardware biometric-based proof of personhood. And ideally it would be a specialized, version of that. You can get privacy fairly high, he says. Accessibility and scalability, medium. Robustness of decentralization is fairly low because there's hardware, supply chain, issues, all sorts of reasons why. Security against fake people, medium. That's what WorldCoin is pursuing. And then your other option to do this is a social graph-based proof of personhood, where your privacy is kind of low because you have to trust a circle of other human beings to really

Starting point is 00:29:52 validate you and verify your personhood. Accessibility and scalability has been fairly low. These solutions haven't really taken off yet, which is kind of the concern, even though they exist. The decentralization, though, is very high because it's bottom up, and the security against fake people is also high. So we kind of contrasts all of these things and presents the world as a series of engineering tradeoffs.

Starting point is 00:30:19 I think one of the takeaways for me from this post is that we shouldn't put all of our eggs in one basket. This is a classic Vitalic take that probably the best solution. That's such a vitalic line. It is a blend of all of the above that we kind of amalgamate together into like the ultimate solution. Which is actually what Gitcoin uses in order to achieve unique humanness on their platform. They don't they don't behold, behoove themselves to one platform. They just use an amalgamation of a bunch.

Starting point is 00:30:44 We should get into some of the other controversy here because as you said earlier, David, the crypto community actually did not like WorldCoin. It was not received with excitement. And I would kind of classify the critiques in a few various forms. One is critiques of World Coin themselves and the implementation approach that they're taking. And the other is a critique of biometric proof of personhood altogether. And then some people actually don't like the idea of on-chain proof of personhood at all. So maybe we'll take the first one, which is like World Coin sucks.

Starting point is 00:31:17 This is left eras. What is he saying here, David? Yeah, Levitra says, just a list of bullet points of criticisms about WorldCoyne and goes, 20% of the supply of world goes to team and investors. There are privacy concerns about the actual cryptography that protects people's eyeballs. There's malicious orb operators. And so the idea with this orb is that the people, like operating these orbs aren't necessarily WorldCoin employees.

Starting point is 00:31:44 It's the public. The public can operate. A public person can operate an orb. But then that means that one public person can try to manipulate the orb in order to scan other people's eyeballs and take their WorldCoin on their behalf. So that's it. That's, that's issues. You can also tinker with the orb. So that's his next one, malicious slash compromised orbs, bribing poor people with tokens for an eyeball scan. And then his last one, which is kind of just like the vibe of the whole thing. It just feels really dystopian.

Starting point is 00:32:08 I mean, it's called WorldCoin, right? It's called WordCoy. It's got a Chrome orb that you stick your eyeball into. One of the founders is the guy making like, you know, AI after bank list, we just did a bunch of like AI Doom episodes. Like it's the whole thing is just like perfect storm of dystopia. Yeah, dystopian feeling. Here's a more specific take list of issues from Zach XPT. My issues with World Coin. He says, most alarming to me is how the World Coin team is boasted about how many users they have when in reality they have been exploiting people in developing countries. This is sourcing an MIT technology review article from 2022 about that. Verification that you're a real person seems to only be currently enforced at the enrollment level. And so what this has led to

Starting point is 00:32:54 is the emergence of a black market for accounts. So you can buy a WorldCoin account on Telegram for, you know, a dollar per WorldCoin account. It's being attacked in that way. And then some criticism about the token allocation. There are a few more. So this is under the category of like WorldCoin sucks. And so you can find a lot of critiques for that, including another one from Andrea and Bailey. WorldCoin is still stupid and bad in four points. Number one, the team incredibly was not prepared for people to sell credentials. That's the issue I was just mentioning. It doesn't solve the one problem that was supposed to solve.

Starting point is 00:33:28 There's also some criticism about the foundation that WorldCoin, the kind of the org structure they're creating. That comes to the territory. Everyone complains about the foundation of every project. Giving Insiders 20% tokens. So it's that kind of thing. So one category of critiques is just about WorldCoyne and how it's implemented and how it's being done itself. But going back to those circles, another. category is basically broader than just Worldcoin sucks, that critique. It's a category of

Starting point is 00:33:55 all biometric proof of personhood sucks. Like we should never use biometric proof of personhood at all. And going down that path will lead to dystopian outcomes. Yeah, I was talking to one of my friends, Scott Lewis. He gave me a take that I'll like to read out actually. He goes, basically every futurist thinking on biometric scanning has concluded that biometric scanning is absolutely oppressive technology and there has been a dedicated effort to to tell stories where the use of biometric scanning was used by oppressors. Not everyone in the world needs to become a domain expert on exactly why biometric scanning is consensus, scary technology in the eyes of generations of science fiction writers to understand

Starting point is 00:34:32 that there is a consensus that this stuff should not be effed with. Reality land, current governments are the arbiters of who a person is in many but not all governmental systems. If the initial read of the government seems incorrect to you, you have a clear schedule of codified rights and options to appeal and correct that decision. replacing that Oracle with a profit maximizing corporation composed of Sam Aldman cronies who offers zero recourse is much worse. We have a good track record of corporations and similar positions offering no effective recourse to their customers when they are deplatformed.

Starting point is 00:35:02 WorldCoin would be in a position to de-platform someone from the literal claim on being a human. Dystopian isn't a feeling in a situation like that. It's inevitable, which I thought was a good analysis of the whole context. Because there's a very specific, like, critiques of WorldCoyne about specific. specific implementations. And then like there's the broad sweeping strokes of like the whole vibe is just illegitimate. And you just have to trust the vibe across the spectrum. Like serializing people in this way hasn't worked out well. Yeah, don't serialize people. Yeah. Don't serialize people. I mean, one pushback against that take before we get into it though is like aren't we already being serialized in so many so many ways. Yeah. I'm just like every time I and this time we have cryptography. So like you get to serialize people and then ZK Snark it. I just I feel like I feel like I feel like I. I feel like. I feel like. I feel. I think that's a valid take. I think our tech companies are already doing that every time I stare down at my iPhone to unlock it, right? It's like doing facial recognition, biometric recognition of my face,

Starting point is 00:35:59 and it's unlocking it. You know, if you don't look at the camera, it won't unlock. It needs your eyes to look at the camera on your iPhone. Well, you even look at, you know, kind of Apple's new VR goggles, right? That's just directly iris unlock, IRIS scanning unlock, right? And I'm, Yeah, there's like eight cameras in there. This is such a messed up position to be. It's like, I'm excited about that product. And like, maybe I shouldn't be. Maybe I should be fearful of that product.

Starting point is 00:36:25 Anyway, so that's another criticism. It's just like biometric proof of personhood descends into all sorts of like corporate dystopianism. There's another critique, I think, which is a good critique and worthwhile. And that's, we already have better decentralized proof of personhood protocols. So circle, bright ID, get coin, pass, or proof of humanity. These are social graph based. You kind of build a web of trust, right? So I know you, David, so I'm willing to like vouch for you and you're a real human being because

Starting point is 00:36:56 we've met in person. So I'll vouch for you and you know someone else. You'll vouch for that person. You kind of build from the bottom up this social graph based approach. I think that's totally valid. And I love those approaches, by the way. And we've talked about them on bankless several times. My challenge with those is they just haven't scaled yet. Right. Like we don't have hundreds of thousands or millions of users on these things, and I'm worried that they just might not scale. Maybe we can crack the code here, and I'm still optimistic, but that's kind of the worry. But here's my takeaway after this episode. What cypherpunks seem to think about on-chain personhood, first of all, our current state is the nation, right?

Starting point is 00:37:34 So we all have passports, and the nation can go bad depending on your government. So if your government goes evil or authoritarian, right, you know, nation-state serialization is going to go bad for you. The second method is biometric. And the criticism, I think, many in the cryptic community say is that, well, anything biometric becomes a corporate evil because you need hardware to go collect all of the irises and that ends up being owned by some evil corporation. Maybe Worldcoin is sort of one of those. And so it always descends its flawed and can often maybe always descend into a corporate evil.

Starting point is 00:38:08 And then number three, social graph. That's still decentralized. And that really remains our best shot. And I'm sympathetic towards that. I worry that number three is not scalable. But there's also, David, a whole bunch of people who think we don't need on-chain personhood at all, which was interesting to actually consider. This was from...

Starting point is 00:38:26 I think that one's a cop-out. Well, this is from Nick. Before you dismiss it, this was from Nick from ENS. He says, unpopular opinion, truly decentralized, trustless, civil resistance, or proof of humanity is impossible. You know, he's not saying that, like, it wouldn't be, it would be great if we could do it. He's saying you can't do it. It's theoretically impossible. Yeah.

Starting point is 00:38:47 He says, we should stop trying to make it work and instead focus on building systems that don't assume individuals are unique humans. So he's like mission impossible. You can't even do it anyway. So stop trying. We don't need it. We can rethink our systems beyond this. So that, I think, is a summary of the crypto community's reaction to all of this and all of the criticism. I want to turn towards something else, though, because there was also. some criticism of bank lists. Like, why did bankless decide to have world going on? What's, what do you want to say about that? Well, it has a ton of attention. And so that if people's attention go there, then my attention goes there. Also, there's obviously the poll of like Sam Altman.

Starting point is 00:39:33 And then there's obviously also the poll of Sam Altman on bankless. Like, that's just kind of cool. I will say you weren't there on that episode because it was Mother's Day. It was like a Sunday. So I was taking it while I was in the middle of Zuzalu. Why did we have WorldCoin on? Well, it's a huge project. It's a massive project. There's only so many proof of personhood projects out there. And this is the only one going after the biometric sector.

Starting point is 00:39:57 So like just as understanding the scope of like the crypto rabbit hole, the biometric proof of personhood is a part of the crypto rabbit hole. It's a part of like the things you can explore. So I considered it a legitimate place of expert. exploration. Then there was also criticisms of like the way that I managed that interview, which is I didn't, I didn't really push back on anything. I didn't really have any critiques for them. I kind of just let them walk through the project and explain themselves and say, here's what this does and here's how that works. And this is a World Coin project. I'm like,

Starting point is 00:40:29 great, thanks for coming. Granted, I only had 60 minutes. There was a hard stop. And so that is a extreme constraint on my ability to be to be thorough. And also the other half of my ability to be thorough is like some of the tech stack behind, A, the hardware and the zero knowledge cryptography that keeps things private, I don't have the skill set to vet that. And so I have to just kind of run on trust and faith of people who actually can be more technical than me. And so my intention of the World Coin episode was, hey, crypto universe, hey, bankless nation, here's the World Coin Project, here's an episode with Sam Altman, discuss amongst yourselves. And then I get back to like, bankless, why the F did you host?

Starting point is 00:41:10 this country, like these people. Why did you not talk about like the dystopian nature of this? Why did you like tee it up in the intro as like one of crypto's most ambitious projects? And I'm like, I guess I got the vibe wrong. I could have been more critical. I could have pushed back more. But at the end of the day, it's just like we're all, I'm also feeling like I'm caught in the middle of bankless. You're so opinionated. Why didn't you have an opinion on this one? Like you're so opinionated about ether. You're so opinionated about layer two's. Why didn't you have an opinion on WorldCoin? At the end of the day, it's like I, sometimes I'm in a particular state, a disposition,

Starting point is 00:41:47 a mood. I don't have the mental like capacity to be mean to Sam Altman. And I'm a guy who I don't really know who he is. I don't know. I'm asking for forgiveness. Are you really? I guess, yeah. I think, so I think, like, I appreciate that.

Starting point is 00:42:04 I think that we could have wrapped that episode a little bit differently. But I think what people maybe, some people don't. don't understand if they just hear that episode, maybe didn't catch the debrief, or don't understand the wider context of what we do is like, episode one is kind of like about WorldCoin is kind of a conversation starter. It doesn't stop it. The first episode we do on WorldCoyne, all right? We're going to do like the world coin panel of all of the critics about WorldCoy. We're going to do the episode with all of the decentralized web of trust alternatives to WorldCoyne. We're going to do an episode of the pros of the cons. We're going to see how this

Starting point is 00:42:40 whole project turns out. So, um, yeah, that's another element to it. And then there was also the critique that's like, oh yeah, Sam Altman and World Coin paid bankless to co on the podcast. And I've said this, you've said this. Well, I take offense to that. 10,000 times and we'll say 10,000. I take offense to that one. That one, yeah, they need to apologize for that one. bankless has never and will never ever take money for, for content. That's never happened on the newsletter. We have no investment interest. We have no investment interest. There's no other investors of bankless. We're beholden to no one.

Starting point is 00:43:11 People make up, you know, people can make up anything on the internet. Anyway, this was kind of a deeper take, too. This is a defy cheetah saying, I thought the alternative to world coin was bankless. Basically the implication of like, why do we even need a world coin? Like, I thought you guys were bankless. And I just wanted to push back on that and support the idea of decentralized identity, decentralized proof of personhood. So, guys, just so you understand it, bankless is an alternative to banks.

Starting point is 00:43:40 But today, nation states provide our core identity. So you get your passport. They are the arbiters of identity. Yeah, they are the AMLKYC. It's a passport. It's a license. Banks don't do that. Stateless is the alternative to states.

Starting point is 00:43:54 And if we want to do cool things, like one person, one vote, or on chain credit without relying on the state to need to know who humans are, then we need some sort of decentralized identity. Okay. World Coin is building a protocol to tell who the humans are without the state. All right? I don't know if this is going to work. out well or if it's going to be bad. But I just saw a lot of anger this week on crypto Twitter

Starting point is 00:44:17 about this. And some of it is totally warranted. Some of the takes that we just read were completely warranted. Some of it is really uninformed. And my encouragement is basically to channel some of that anger into building. Like if we don't like what World Coin is building once we pop the hood and look at it, let's build another alternative. Because that's what we do at crypto. I mean, we're crypto and we build. So that's my encouragement. Let's not give up on decentralized proof of personhood in general. And so I guess my take on all of this, David, after listening to the conversation that you had with Sam Altman and WorldCoin is, like, I'm still undecided about World Coin as a technology. I'm cautious. I'm open to it because I hate that AMLKYC and state identities is the only way

Starting point is 00:45:02 forward for some of these use cases. I see decentralized personhood. proof of personality as an unlock. And maybe we can do it. Maybe we can't. Maybe biometrics is a really bad way to do it. Maybe it's not. I'm kind of taking a wait and see approach. I'm not at this point willing to get orbed myself. All right. So if that gets you my statement of faith about the World Coin project, I wouldn't do it. There's not enough value for me. I'm kind of like I haven't heard enough compelling reasons why. And I'm not supportive of WLD tokens. I have no comment about that. I have no idea what the value of WLD might be. I'm not. I've got some comments. but it's $21 billion, guys.

Starting point is 00:45:40 So just go think about that. What I care about most is the conversation about this that we're having as a community. I think that's important. And I think that's been opened up in a positive way. And also competition. I just emphasized, if we don't like what WorldCoin is doing, let's build a better decentralized alternative. Yeah. Yeah.

Starting point is 00:46:00 So anyway, that's my take on things. Yeah, on the whole WorldCoin token question, we have a question from the name. Kyle Kaplan from the banklo-station discord. How does WorldCoin token plan on accruing any value? UBI sounds nice and all, but we all know you just can't print money out of nowhere. I think it's a huge question about WorldCoin. Why the F is this thing, $21 billion? Is that what it is?

Starting point is 00:46:24 21 billion when it only ever gets issued. Like the only bowl case I can articulate for the WorldCoin token is that the humans deem the distribution of WorldCoyne so incredibly legitimate and fair that they want to be a part of that very fair network. It's competing as the money, isn't it? In the same way, Bitcoin, ether in the US dollar and gold is going to I don't even know if it's doing that. But that's the only value they have. I don't, I don't even know if they like Alex Blania from WorldCoin has a statement about what he thinks about the WorldCoin asset. He probably can't say it because he's the issuer of it. But like that's a very

Starting point is 00:47:04 dubious value accrual. It's just legitimacy in of itself. Plus, when you see telegram snaps screenshot of people selling, hey, I'll sell you a World Coin account for $1, like that very much erodes that value proposition. Like there's other like theses about it. Like it's a graph for just because it's fair. Like I don't see the value accrual.

Starting point is 00:47:25 Yeah, neither do I. I still do think it's competing in the money, the monetary value category, right? And it has to. I just don't think it has a good shot at that. But like it's not producing transaction fees. it's not a cash flowing asset. So meme value money. The question from Kyle is interesting. It's like UBI sounds nice, but we all know you can't just print money out of nowhere. I'm like, yeah,

Starting point is 00:47:49 but isn't that what Bitcoin and Ether did? You know what I mean? Like if you can get a meme bootstrapped and kick started and enough people believe in a money in the story. They can solve the problem later. Yeah, you can solve the problem now. I don't think that's the path that WorldCoin is on, but I'm saying that if there is a path to it being worth billions of dollars, my take is the path is going to be a bunch of people believe it's a monetary instrument and it's used as a monetary instrument. Yeah, I'm so parish on that. I'm so parish. Because then it competes right next to Bitcoin and ether. Like, it's not going to survive that fight. Bankless Nation, you can make your own decision on WorldCoin. If you haven't caught David's conversation with

Starting point is 00:48:29 Sam Altman and Alex from WorldCoin, then go ahead and catch it. There's a link in the show notes and also it should be in your RSS player. David, enough about WorldCoin. Let's do a good bill, bad bill. There's some good news in Congress for crypto, at least the U.S. Congress. So this bill hasn't passed, but it's a set of bills that are very positive for crypto. And they were just voted on by the House Financial Services Committee, and they passed that vote, which is a pretty big deal, apparently. Jake Chivinsky calls this vote a historic day for crypto policy. There's two bills that are wrapped up in the this in the house that are pretty cryptositive. The first is called the financial innovation and

Starting point is 00:49:08 technology for the 21st century act. So this is a framework for issuance and trading of digital assets at the SEC and CFC. You know that whole clarity of like what's a commodity and what's a security? This bill directly addresses that. So we actually get some clarity here. The thing that Gary Gensler never gave us. That's what the fit is doing for us. And that's part one. Part two, David is the blockchain regulatory certainty act. It clarifies that non-custodial blockchain developers and service providers. This would be like minors,

Starting point is 00:49:42 validators, if you're an at-home validator, wallet providers, that they never custody consumer funds and don't have to register as money transmitters. You know the nightmare scenario of you run your own solo validator? That's like the earliest bill that came in that like deemed that, hey, if you're part of it, if you run a

Starting point is 00:49:57 node, you process a transaction, there would be a money service. That was the very first like crypto like fire alarm that we had. Oh my God, it would be so scary. It would basically mean that it's kind of illegal without being registered to be a validator in the U.S. Yeah, the good news here is that this is bipartisan. So 35 members voted for it versus 16, 35 to 15 at 1. And 25% of those 35 were actually Democrats. So some bipartisan support that we haven't seen. Tom Emmer, of course, led it. I want to play you this quote from Richie Torres. He's on the Democrat side. And he was weighing in on comments for. All right, here it goes. Thank you, Mr. Chair.

Starting point is 00:50:35 I'll just offer a few thoughts. I mean, there are profound philosophical differences on the subject of crypto, and there's almost no point in relitigating those differences because it's been extensively debated here today, but I find myself unpersuaded by the notion that the status quo is working. You know, a status quo that gave us

Starting point is 00:50:59 the largest crypto-Ponzi scheme in history is not working, it's by definition failing. My assessment is that the status quo is dangerously deregulated and requires regulation. Albert Einstein said if we do the same thing over and over again and expect a different result, that's the definition of insanity. And the time has come for us to break the cycle of insanity that governs the application of securities law to digital assets. Now, there's a difference between securities law as we, individuals might think it ought to be interpreted, and securities law as it has been interpreted

Starting point is 00:51:37 by the courts. And the Southern District of New York has held... I really like Richard Torres. That guy is great. Yeah. Big fan. Great comments there. And the one thing we wanted Congress to do is to provide clarity, and that's what this bill is doing. So Tom Emmer is going to be one of the architects of this bill. I think the next time we catch him will probably be at the permissionless conference. It's happening in September. We're throwing that conference with Blockworks. the 11th through the 13th. This is going to be a topic of discussion with Tom Emery, for sure. David, we got a bad bill, though, too. It's coming from the Senate. You ready for that one?

Starting point is 00:52:11 Oh, yeah. No. It's sad. In contrast to that, the Senate is proposing a bill. I'm going to read you the title here. It's called the Crypto Asset National Security Enhancement Act of 2023. Did you catch that? I don't like those words. National Security Enhancement Act. I don't give a F what's in that. I don't like it. Yes. You know it's going to sound a little Orwellian when it has national security and crypto asset in it. Enhancement. This one is also bipartisan, but only, unfortunately, it's bipartisan.

Starting point is 00:52:47 Again, this is coming from the Senate. But basically, it mandates that defy protocols and anyone who controls them or makes them available have to impose bank-like surveillance for their users. So that would mean defy controllers, right? to vet and collect information on the customers, have to do the AML thing, have to report suspicious activity of the government, have to block sanction individual users from their protocols. Do you remember the stuff that SBF was advocating like a year ago in some of the crypto legislation that he was like proposing being like, you know, I think all DFI protocols,

Starting point is 00:53:22 interfaces, app user interfaces should have AML KYC in complete state surveillance and are basically money transmitter banks. Yeah. It's It's a lot of that. Bill Hughes from Consensus has some takes. He said, this thing is a doozy. He says, in summary, it deems that digital asset protocols defined really as any software deployed on chain is controlled by, that's controlled by backers. And the backers are those who develop or retain meaningful control over the protocols and transaction facilitators who develop and make available applications that facilitate use of the protocols. Basically, what this means is that any U.S. originating or residing person or an entity who invest more than $25 million

Starting point is 00:54:04 in building a protocol or owns that much or more in the governance token. If you even just own the governance token, okay? Anyone who develops and offers the front end of the users or owns the governance tokens would deem to be in control of the protocol for sanctions in AML purposes. National security enhancement. Get the F out of here. They're just, just like saying every user of crypto, get the F out of the way, we need to catch North Korea. Basically. And for entrepreneurs or those investing in kind of like governance protocols or those building interfaces on top of protocols that some bad actor might use, they would be part of the responsibility tree here. So Bill concludes this by saying if this legislation goes through

Starting point is 00:54:55 by-bye permissionless global computing, at least as the U.S. is concerned. really bad news. And I think, David, this right here is like Gensler is kind of a side show compared to this. To me, you know, when crypto talks about the final boss, this right here, national security. Yeah. National security is the final boss. If, like, if crypto dies in the U.S., it'll be to protect us from terrorists and bad guys. And that's why this bill is kind of worrying, coming from the Senate side of things. Anyway, we got good news and bad news this week. one and just hope that for the best. Yeah. Well, you know, we've got some good news coming up in the next

Starting point is 00:55:33 section. What are we talking about, David? Coming up next, optimism drops the law of chains. I'll walk you through all of what that means. And CoinDesk is being sold to my first boss in crypto. I'll talk to you about that. Chain link launches the CCIP protocol, all these things and more. But first a moment to talk about some of these fantastic sponsors that make this show possible, especially Metamask portfolio. you already have a Metamask account, so your Metamask portfolio is waiting for you. There is a link in the show notes. Open up your portfolio with Metamask.

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Starting point is 00:57:53 that is going to be iterated on in the OP stack world, in the world of optimism governance. The idea here is the problems that we have are the OP stack is getting forked and deploy new chains like almost every single day, right? We got base, we got Zora, we got the WorldCoin token chain as well. There's a few others ones as well. Oh, yeah, we didn't mention that. WorldCoin is deploying in the OP stack. Yeah, I mentioned it. We mentioned it.

Starting point is 00:58:17 People are forking the OP stack. I don't want to like putting World Coin back in the closet. it. Dave wants to forget about them. Yeah. The OP stack is getting fork. So now there's all these OP stack standard chains. More chains than what can be managed.

Starting point is 00:58:31 So like, what do you expect users to do to go to MetaMask and drop down and go to like, okay, here's OP stack chain one. OPSack chain two. No, we want just one. And so this is, the law of chains is the first step along that process. So from the law, this is what I wrote in the tweet, from the law of chains spons the OP super chain. This is where we're going. And so because of every single new OP stack chain is a different chain, we still want them to behave like one chain. But since adding new OP stack chains to

Starting point is 00:59:02 the world is completely free, completely open, completely, completely permissionless, how do we actually determine what is in the super chain versus out of the super chain? Because, you know, since anyone can fork the OP stack and spin up a new chain, that chain could be a rug. that chain could be, you know, an exploit. That could be a bad chain. So if we want all of these OP SAC chains to converge into the super chain, they all need to pass a certain threshold of quality assurances. And this is what the law of chains puts forth. It's, you must be this good or higher to be included into the super chain. And so this is the document that the OP community is working on to determine what is that line, what is that threshold for inclusion? And after that, we can start to have

Starting point is 00:59:48 collective bargaining power for all the OPS SAC chains that are in the super chain. And so what does that mean? The cost to spin up a new ether scan, like Optimism EtherScan, RB scan, Polly scan, or, you know, talking to Infura or Alchemy. These are, it all takes, those are deals that have to be inked. That has labor costs. But when all of these OPSAC chains are formed under the same standard with a very strong level of quality assurances, all of a sudden, all of those can coherence. All of a sudden, into one single collective of chains. And so EtherScan and all these people can start to treat these chains as equivalent

Starting point is 01:00:24 because they are. And so this is what the law of chains has started to kick off. Is it basically like, what is it though, David? Is it like a document that is it like a... It's a proposal of standards. It's a proposal of standards. It's a document that is proposing standards.

Starting point is 01:00:38 Okay. And then basically these are the standards for joining like the Confederacy of all of these chains. And if you meet this threshold, then you can be adopted into this confederacy of chains. If there's some sort of like formal body that votes and it's like, yeah, this chain's good,

Starting point is 01:00:54 that chain's bad, we're letting this one in, we're booting the other chain, or is this, are we not there yet? The first step is just to establish the kind of the framework of standards. I believe that is a part of the process that is being proposed. That is what needs to be figured out. Well, very interesting. There's some takes about this too,

Starting point is 01:01:09 including from Alex from the ZK Sync. What did he say? Yeah, I thought this was pretty funny. So Alex has, he is on team ZKKK stack. So this is a, in the layer two wars, this is a layer two wars tweet. And so he's going, TLDR, OP stack, many chains, one choice, single shared sequencer, centralized M.EV distribution, protected by laws and governance. And then he goes, ZK stack, many chains, many choices. Pick your own sequencer, handle MEV your way, protected by math and code. We are not the same he follows through.

Starting point is 01:01:42 But then his next tweet kind of walks himself back a little bit and goes, I must add a Although my preference for individual and sovereignty is obvious, I admire optimism's brilliant work on governance and public goods funding mechanism designs. We all learn by winning from each other, making Ethereum layer two ecosystems which are stronger. So some spicy takes out of Alex out of this whole like law of change thing. I will say, I mean, got to give credit to where credits do. Optimism has all the chains. Like they've got, they've got base. They've got mantle.

Starting point is 01:02:11 They've got WorldCoin, if you care about that. But I'm putting that one back in the closet. They've got Zora, which is the Tezos, like the media. network but now on Ethereum. And so like you got it. When we were looking at the stats earlier of like optimism beating trumping arbitram in transactions, that's just main net. That's not what about all the other chains?

Starting point is 01:02:30 What happens when all they, all of those chains form into the super chain? That I think is really cool. We're going to do a podcast with Jesse and Ben on this whole concept because the, the negotiation between Coinbase and the OP collective as to help what does what does that relationship look like has carved out like room for this whole law of change thing. So this is a big learning moment for everyone. Well, since you're being the optimistic roll up bull, allow me to be the kind of the ZK roll up bull for a second. What I would say is this is just the first inning though, David. And like we got a lot more innings. And it's actually a miracle that

Starting point is 01:03:05 ZK roll up technology has kind of come to market so quickly. And I do think that there's something to this last point that Alex said, which is protected by math and code rather than laws and governance. It's basically like ZK cryptography, it's magic moon math, right? And you can do things with ZK that you can't do with fraud proofs. You know what you can do with ZK, Ryan? You can turn an optimistic chain into a ZK chain. Let the games begin. I think we'll have to see how it plays out. And again, check layer two beat for the progress here. But this is just the first inning. And disclosures, Ryan and I love the OPE stack and the ZK stack so much. We are advisors to both optimism and ZK Sync, the producers of both the OPE Stack and ZK Sacks.

Starting point is 01:03:49 Really the common denominator is we just love stacks. I love stacks. I love them. I think they're so great. Love decentralization. Speaking of stacks, David, Starknet, still building in the background. This is, of course, a ZK-centric ecosystem as well. They announced last week that they're incredibly excited to introduce Starknet app chains.

Starting point is 01:04:09 They say Starknet is a marketing. They're announcing a stack. That's what they, it's their stack. Now they have a stack. Yes. This is an app chain stack as well. So this is another fantastic team who's building the Starknet stack in the ecosystem. And it's interesting to see this game about in our Polygon conversation early this week with the founders of Polygon.

Starting point is 01:04:29 It's just like there's some convergence in layer twos to like the stack-based model where you have your kind of general purpose EVM type of chain. And then you have app chains and you're creating like a full stack for chain developers to deploy to your ecosystem. and all of the ecosystems are competing against one another. They're also working together in some weird ways against other side chains and alternatives. It's a very interesting time to be in crypto on the infrastructure side, I'd say. I love it. I love it so much.

Starting point is 01:05:00 It's like finally, it took two years more than I thought it'd take to get to this point, but finally here we are. Uri, Uri Kolodny of Starkware, he will also be a permissionless. So if you are interested in the Starkware stack, he'll be a permissionless. David, I got to ask you because all of the tweets we've been reading out this week, I don't even know if there are tweets any longer because, look, this is called. Okay, we're doing this.

Starting point is 01:05:23 Yes, we're doing this. Elon Musk has just transformed Twitter into X, the everything app. All right. See the big X on the top left, no longer Twitter. This whole thing is called X. It's a big rebrand. And this is part of his plan to make, I guess, Twitter now X, into some kind of super app. What's your take on this so far, David?

Starting point is 01:05:44 Actually, it's worth noting that X.com was Elon's first startup that actually made him his first money. I'm really fuzzy on the details. But he's had X.com for a long time. That was like, it's something to do with PayPal. It was like one of his first startups. It was going to be an online bank, actually, like a startup. And it was going to be the X bank. And so this is not Elon's first flirtation with this whole X.

Starting point is 01:06:12 thing. So he's like pulling this out from downtown, like out of his pocket that he's, you know, just being kept up the sleeve. And now Twitter is now X. There's so many things to talk about it. I don't even know if we have enough time to go into it. But it's like, man, they're called tweets. The bird is blue. It's a blue bird. Everyone knows it. It's Twitter. It's Facebook. It's Instagram. And all of that is just completely thrown down the trash. Like brands take forever to get built. And now we have this extremely basic. X thing. They're called Zietz. X E-E-E-T-S. We're supposed to be Z-D-D-Y. Now we had a, we had a, we had a spaces with Taylor Monaghan. And are they X spaces now? Because that sounds dirty. I don't want to be in an

Starting point is 01:06:58 X space with anyone on Twitter or excuse me on X.com. Like, uh, okay. So this, my take about when Elon first bought Twitter was it's probably getting break and get clunky. And then if he can do it, it'll get better from there. Yeah. But it has gotten so much worse than I've ever thought possible. And he's trying to rotate it into a super app.

Starting point is 01:07:19 Like, you're really testing my conviction, Elon. Like, I'm not enjoying this. Yeah, I'm going to get off. He's saying some pretty bold things. Like, if done right,

Starting point is 01:07:26 X would become half of the global financial system, right? Wow. What do you mean? He's saying pretty bold things. He only says bold things. I mean, this is like,

Starting point is 01:07:33 but this is, I mean, is he going to incorporate crypto? What's that going to look like in the future? I just got to be honest on the branding of this. You look at kind of the left versus the right, and this is someone's take.

Starting point is 01:07:44 Going to be honest, this new widget design looks like an app for membership, for membership only human trafficking gentleman's club headquartered to Budapest. I mean, look how... My app is, my phone is still Twitter. It's still a blue bird for me. Is yours an X now? It's, uh, I don't think it's turned into an X, but just the top left. On your phone, even here. I don't know. I haven't looked at that, but like the top... So many of these things don't make sense now because now we have the Twitter blue. If you have that circle tweet button, it's a feather.

Starting point is 01:08:09 Elon. Yeah, I don't know. Stop messing with my life. There's a broader, I think, conversation here, which is, this may be a rumor. I'm not sure what to make of this, David, but this tweet says, yesterday the owner of Twitter handle at X tried to sell it for $1 million. And minutes ago, Twitter or X, Elon, took it away from him and transferred the old at Twitter account to it.

Starting point is 01:08:33 And the owner received $0. This could be some speculation here. But the point is like your handle You don't know on Twitter Your handle on X, you don't own. Is Elon's. It's not a domain name. It's not it's so one thing I guess I'll say is Maybe I'll give credit to Elon in this

Starting point is 01:08:51 I think Twitter has always Toad the line of trying to be like a public square And like a public good and an open protocol But like that being a facade and not really doing it well You know? It's just like, Well, if it's an open protocol. It was a private company trying to produce a public square.

Starting point is 01:09:12 And they did a pretty good job of it, but it was so a private company at the end of the day. Then it started to like fracture, right? Like, well, do you censor a tweet or not? Well, if it's a public good, you don't. But if it's a private company, then you do. Elon has completely ripped the mask off of that. This is very clearly a private company. This is Elon's app.

Starting point is 01:09:28 When I tweet, I am tweeting on X Elon's private property. I know my position in this ecosystem. I am a serf for like Lord Elon, basically. And so I know that at least, and I can choose whether I want to continue to invest in this or not. I think a lot of people will choose to pursue more open, real public alternatives. And maybe that's where Web 3 and Crypto finally starts to take off. But at least with Elon, we kind of know where we stand. This is a private company and a private application.

Starting point is 01:10:01 And as a user, you can either use it or not, but you don't necessarily have, have, have, on this platform. You don't have any assets that you own. Yeah. Yeah. I want this story to hurry up and finish. Like, can we just, can we get to the super app or can we go back to Twitter? But this limbo, I don't like being here. It is a feel awkward stage. Speaking of awkward, I don't know if you call this awkward or progress here. RFK Jr. just confirmed that he purchased 14 Bitcoin, David. So he's now joined the club officially. That's $450,000 worth of Bitcoin. $414,000. So he's officially part of the Church of Bitcoin.

Starting point is 01:10:41 He's a holder at this point in time. I don't know if he's doing that for investment purposes. Knowing the little bit I know about RFK, he fits right in. Well, take that as you will, RFK. David. Ryan, do you remember my first job in crypto? Didn't you work for like some shady ICOs or something? No?

Starting point is 01:11:03 No, even worse, dude. It was an ICO advisory agency. Wow. Wow. David, the scammer? I mean, only in hindsight. In the moment, I thought I was leading a revolution. I was a mere community manager. I would write blogs. Anyways, I worked for this company called New Alchemy, which was a, it did a big number of ICOs, Aon Network, like A-I-O-N, if you remember that, 2017. Interoperability. I remember that.

Starting point is 01:11:27 Yeah, yeah, yeah. And then everything ground to a halt when we realized that all these ICOs that were doing are securities. And that's actually where I got my securities training. Anyways, like my knowledge base. Anyways, the owner of New Alchemy is this guy, Peter Vessnes. He was my first ever crypto boss. And so his, after that company blew up, he's been in Bitcoin since forever. He's now in like a family office, Fisi firm Capital Six. And him and Matthew Rosnack, which is another name.

Starting point is 01:11:55 I have not heard a really long time. Another one project that we did was called Metronome, which I think Matthew from, I think he's from. I remember Metronome. Yeah, I remember Metronome. That was cool. Anyways, that investor group has offered $125 million for CoinDesk, the news agency, which we frequently use here on the weekly roll-up. And so my old boss and a few other of his investor friends have offered $125 million

Starting point is 01:12:21 for Coin Desk. I don't know if this is going to go through, but everything sounds like it will. So yeah, CoinDisc getting sold. I think an important detail there of why is CoinDisc selling. It's because parent company DCG has been in some financial trouble recently. Yeah. They need to liquidate. Yeah, they have like a billion dollar hole.

Starting point is 01:12:37 So they've got over a billion dollar hole. So they've got like, you know, about a billion dollars left to fill. Got some bills to pay. Yeah. So coin that might be a casualty of that. Yeah, you know, $125 million is $125 million. We go. David.

Starting point is 01:12:50 So congrats to everyone at CoinDesk. You now work for my old boss. So does that mean they work for you in any way? Or there's no relation. No, it does not mean that. It's not how that works. Synthetics is releasing. Something big, something new. David, what's Kane Warwick up to these days?

Starting point is 01:13:08 Yeah, so Kane Warwick is releasing Infinex as a layer on top of synthetics to help go toe to toe with centralized platforms, centralized exchanges. And so this is just kind of a more user-friendly layer on top of synthetics. And so it is just a normal registration like a centralized exchange, username, email, password, and it will sign you a unique margin account for every user. No new token. So, It removes all the steps for participating on synthetics, because synthetics now is on optimism. So you don't have to bridge there anymore. You don't have to require S-U-S-D.

Starting point is 01:13:43 You don't need to sign every action. It's probably going to look and feel a lot like Coinbase or any other centralized exchange, but you do have an Ethereum address. So this is going to release alongside Synthetics v3 later this year. Anyone can join. And so beta testing is currently in process. That's great. You know, you know why I think partially what screwed us over in 2022 is BlockFi, Celsius, all of these centralized C5.

Starting point is 01:14:06 They were so easy to use. The app just worked. And D5 really hasn't had that. So if we can smooth out the user experience, then I think we can really grow this cycle. One theme I've been noticing, Ryan, compound, the comp token recently has a really strong performance. Uniswap is releasing Uniswap X,

Starting point is 01:14:25 even though I don't think the token price is doing all that crazy of things. Synthetics, volume, is painting numbers, bro. $500 million in a single day from Quenta, which is basically another synthetics like plug-in. So if you scroll down, you see that little chart, synthetics has never been used more than it has now. Look at those numbers.

Starting point is 01:14:46 That's the most it's ever been used since it exists. OG Defi is making a comeback. OG Defi is, well, yeah, it's like turns out there, remember the whole DeFi 2.0 mania phase? That was actually the top. Yeah, it turns out, no. It's DeFi 1.0, man. Defi 1.0 that's upgrading to 2.0 in the background quietly.

Starting point is 01:15:02 Mm-hmm. Something that is actually new into the defyre world. Superfluid has introduced superfluid subscriptions. So Superfluid is a streaming payments startup. So if you would like to trickle pennies and microtransactions over time, superfluid is that they are releasing superfluid subscriptions. So you can manage access to software, API's content community, however you want to see fit. So that's something that's been released. It's been a long talked about use case in crypto. Theoretically, this case, streaming money. Forever. streaming money. No, and it has been used in gaming, I think. It's gotten some traction, but I haven't personally seen a use case for it that has impacted my life. But I did throw Superfluid over to our web developer, Ryan, say like, hey, does this, does this work?

Starting point is 01:15:44 Can you slap this into Bankless.com? Yeah. And so he's investigating that. Disclaimer, I am an investor in Superfluid. Ryan is not because he forgot to sign the document. Yeah. And I lost that email. I didn't sign those papers.

Starting point is 01:15:57 Oh, well. Sorry about that one. Bullish on the use case. Yeah. You know what? This is also kind of a bullish use case, I think, for Chainlink. They just lost their cross-chain interoperability protocol. CCIP is what this stands for.

Starting point is 01:16:12 David, this reminds me a lot of what Layer Zero is doing. If you're familiar with that part of it. Layer Zero, but Chainlink flavored this time. Okay, well, for those that aren't familiar with Layer Zero and with what ChainLink is doing here, can you kind of describe what this CCIP protocol, what the CCIP features is actually adding. Yeah, so the first step to transferring tokens across chains

Starting point is 01:16:34 is transferring messages across chain because actually tokens and data, they're all the same thing. And so this starts there, but it's basically a cross-chain messaging platform since ChainLink has the security of the link token being staked and it has some amount of assurances about passing messages.

Starting point is 01:16:48 So you start there and then you can build up further and further use cases. And so cross-chain collateral deposits, cross-chain NFTs, cross-chain gaming, cross-chain data storage and computation. It's like a super bridge. Yeah, it's like a super bridge. Yeah, mesh network bridge thing. But it's more than that, because you can build on top of it, right?

Starting point is 01:17:05 If you want to build an app that, like, you know, supports multiple chains underneath, like Avalanche and, you know, other EVM chains, layer 2 and Ethereum, then you can build that on top of this new protocol in ChainLink. Is that right? Yes, I believe so. That's right. I have not looked too deeply into this because, A, I don't really like bridges to begin with and be the chain link army is always up in my mentions and it leaves a bad taste in my

Starting point is 01:17:31 mouth yeah i agree but uh at the same time chain link has always had great tech right and they support a lot of the oracles in the space so they're doing some good things uh flashbots has become a unicorn after a 60 million dollar raise so unicorn status is a billion or above that is flashbots the mv platform there's a lot of a conversation about the development of what they're calling suave, which is a new MEV chain. It almost seems to me it's like it's a marketplace for block builders and searchers and the whole kind of block building supply name. All the participants of how a block becomes a block, it's like a marketplace.

Starting point is 01:18:11 It's a chain marketplace for them. I feel like we need a series of episodes on what's going on in the block builder supply chain space to fully unpack this and understand it. But it seems like private investors are understanding it, willing to upgrade. But in the meantime, I think there's going to be a lot of MEV folks, including Hasu at permissionless. That conference will be another nice check-in. So another reminder to grab your permissionless ticket.

Starting point is 01:18:34 If you haven't. The theme is accumulate and grab a permissionless ticket. David, we got a lot more to talk about, though. What's coming up next? Yeah, questions from the nation. We got an eigenlayer question. They seem to be pretty frequent this week. Then we got a takes of the week.

Starting point is 01:18:47 I got a take from Mike Epitio. We'll talk about bridges there. And then I wrote an article. And so there's five takes in there that I'm going to burn through really quickly. and then, of course, what Ryan and I are bullish on. And we got a hot meme. It's very hot. It's very hot.

Starting point is 01:18:58 You want to stick around for that. So all of that and more, but first a moment to talk about some of these fantastic sponsors that make the show possible. Mantle, formerly known as BitDow, is the first Dow-led Web3 ecosystem, all built on top of Mantle's first core product, the Mantle Network, a brand-new high-performance Ethereum Layer 2 built using the OP stack, but uses Eigenlayer's data availability solution instead of the expensive Ethereum Layer 1. Not only does this reduce Mantle Network's gas fees by 80%,

Starting point is 01:19:24 but it also reduces gas fee volatility, providing a more stable foundation for Mantle's applications. The Mantle treasury is one of the biggest Dow-owned treasuries, which is seeding an ecosystem of projects from all around the Web3 space for Mantle. Mantle already has sub-communities from around Web3 onboarded, like Game 7 for Web3 Gaming and BuyBit for TVL and liquidity and on-ramps.

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Starting point is 01:20:06 it all is so complex. But it doesn't have to be. Complying with labor laws, payroll rules, tax obligations, and crypto regulations in every country that you employ someone is difficult, time-consuming, manual, and costly. And it's drawing more and more attention from regulators and governments. But there is good news. Toku is here. Toku is the first employment and compensation platform for the crypto industry that makes this easy. Toku helps you hire employees or contractors and pay them in fiat or crypto legally,

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Starting point is 01:21:04 It seems to me that eigenlayers positioning Ethereum as a kind of security reserve for other blockchains, much like how the US dollar serves as a reserve currency, providing economic security globally. By enabling Ethereum's security to cross borders into other layer ones, eigenlayer appears to be enhancing the overall security of the blockchain ecosystem. The question is this. Could you delve into this analogy and discuss the implications of this security globalization? I like that term. How could this impact the future of Ethereum and other blockchains?

Starting point is 01:21:34 This idea of security globalization and eigenlayer, what's your take here? Yeah, that's a really good question. You can definitely tell onium.eath, who asked that question, thanks, onium, is like, that's a bankless vibe question, putting these things into like geopolitical country, nation state terms. So like the United States passport, probably the most valuable passport in the world. That's probably a fair take. You can get into the most countries with the United States passport. Like you can just walk across almost anywhere and everyone was like, oh, welcome to our country.

Starting point is 01:22:03 I think what they're getting at is that ether does the same thing for all of the restaking networks. So all these restaking networks is like, oh, you're, you're ether, please welcome and, you know, sit yourself down and also consider providing us some services while you're here. It's pretty, pretty similar, I'd say. Why did Eager choose Ether? Why didn't it choose Bitcoin? Why didn't choose Solana? Well, it couldn't choose Bitcoin because Bitcoin's not proof of stake and it's not a smart contract. Why did it choose Ether over Solana?

Starting point is 01:22:31 Well, because Ether has all the economic bandwidth. It has all the value. If you're going to have a system where you need to have your collateral, to be trusted, you need to post collateral. You need to post the best collateral possible on the network that has all of the networks. and so that is just Ethereum. And so this is part of the story of capital begets capital against capital.

Starting point is 01:22:52 And so you just are, the most number of doors are open to you. And so your security, your collateral, can transcend across boundaries because those boundaries desire your capital the most. And I think there's pretty strong parallels

Starting point is 01:23:05 with what Oneum is saying here. Hopefully that was unpacking that analogy enough to their satisfaction. Yeah, the only thing I would add to that is like the direct answer to the question to me is how does this impact the future of Ethereum in the context of reserve currency status, my take is it cements ether as the reserve currency of not just Ethereum,

Starting point is 01:23:26 but of like, crypto and all of the other blockchains. In the same way that kind of the dollar has been reinforced through the U.S.'s military security and economic prowess as the reserve currency of the world. Like the liquidity and the network effect that you were just talking about, like the capital begets capital security begets security sort of network effect, that just compounds if eigenlayer is successful, right?

Starting point is 01:23:54 Because the- Imagine they're being like 10, 15, 20 tokens on Coin Gecko and their layer one tokens or their network tokens, and they're secured by Ethereum. Yeah. I mean, it is just, it is probably the single most bullish thing if this takes off for either the asset since, I don't know, staking since

Starting point is 01:24:15 ultrasound money, since EIP 1559, like it's absolutely massive, I think, and his ability to build network effect. All right, let's go to some takes of the week, David. Coming in with takes of the week, we only have two. This is Mike from Blockworks, and this is a post-ECC take. He goes, if there's one thing I learned from Paris,

Starting point is 01:24:32 is that market makers are bridges now. And this is a conversation that's slowly been brewing and I think really has crescendoed with Uniswop X. Uniswap X, also CalSwap, I think also perhaps suave itself. These are all platforms that allow for bridges to be completely abstracted

Starting point is 01:24:52 and also like kind of largely routed around. It's really bridge minimalism. Almost obsolete, right? Yeah, you still need them but you need them in the minimal fashion. They need them a lot less. Yeah, and so why is that true? It's because market makers,

Starting point is 01:25:07 what does it mean? Like why are market breakers bridges now? Say, Ryan, you have ether on the Ethereum layer. and you would like to have die on the optimism layer two. Instead of hopping, instead of making a trade on uniswap and then hopping over a bridge, what you can do is you can just post a transaction, not even submit a transaction to Ethereum, but broadcast a transaction that says to any market maker,

Starting point is 01:25:29 hey, I have this much ether, give me as much die as possible on the chain that I wanted to be on. Like I just broadcast my intent. I don't actually have to commit to the transaction. Right. Uh-huh. And then a market maker is like, well, I'll take that deal. and maybe a different market maker is like, well, I'll take that deal too, but I'll do it better. And all of a sudden, the free market fulfills your order

Starting point is 01:25:49 and puts your assets that you want and the place that you want, and you never had to touch a bridge. And like the bridge security is like minimized. And so this is kind of a meta that has been unfolding. It's like bridges are kind of just being routed around. Yeah, this is another series of bankless episodes, honestly, to get into this whole world of intense rather than transactions. I feel like we need some content on this to fully untridden.

Starting point is 01:26:12 pack and understand it. But yeah, that is an emerging, you know, meta here. David, what are some other things you learned from ECC? I saw you put a post out in the bankless newsletter this week. So what were some of your key takeaways? So, yeah, I actually took some time and wrote out an article about my big takeaways from ECC. It's about 2,500 words. And I'm going to read it. Let's go. I'm kidding. I'll just read the headlines. The big ones are protocols are becoming commodities. My big TLDR here is that by the time the next bull market, It comes around the cost of Web3 compute, trustless computation, data, whatever we need to do Web3 things. Drops to zero.

Starting point is 01:26:49 We'll have approach its theoretical minimum. Like that's one of my big takeaways. And you can explain my reasoning and all the tidbits of data that I have about that. So that's the first one. Second one, protocol convergence and verticalization. So AVE just launched the Go stable coin. Maker Dow just launched Sparks, which is an Avey-type money market. Frax has already had both of these things, and they also have their own internal LSD.

Starting point is 01:27:15 So these things are all starting to, A, become verticalized, and B, converge in their same design patterns. We already have the convergence. It's like all the different protocols are becoming stacks. It's all the stacks. We have all the stacks. And so those are all converging along the same design patterns. Then you have uniswap X becoming a vertical on top of uniswap. So there's a bunch of convergence and verticalization going on.

Starting point is 01:27:38 So that was my next big one. But then after that, it's like, okay, we have protocols that are maximally cheap. We have defy apps that are becoming maximally like as vertical and wide as possible. It's now time to think of the consumer. And I don't only just mean more apps to buy more block space, but can we build front ends like Infinix, like what Kane is doing at synthetics. Can we build front ends? Can we build apps?

Starting point is 01:28:03 Can we start doubling, tripling, quadrupling down on building consumer level stuff? that is built for people that have never touched a private key. That's my call to action on there. And then my last big takeaway is the Modular Summit versus ETHCC. There's two different conferences here. Some of just like the different dispositions of who you find where. But my big takeaway from Modular Summit is like that whole community, it's like the Celestia, Espresso, the Layer 2s, the eigenlayer.

Starting point is 01:28:31 That side of crypto is just racing out into the frontier. They are developing and discovering things so quickly. They are the actual frontier of thought, I'd say. And so that's my takeaway there. And then just as a conclusion, if you haven't caught the theme of this episode yet, next up is permissionless. So that's going to be where the next bankless meetup is and the bankless party. It's going to be like 200 plus people for all of our citizens and friends and everyone

Starting point is 01:28:56 we want to party with. That's awesome, man. Those are some good takeaways. Each of those could be episodes as well. I feel like we need to dive into topics more. This is true. What do you both show on this week, man? Right behind me, like I said, is the Matterhorn.

Starting point is 01:29:11 And I don't climb it tomorrow. We climb a training mountain tomorrow. But then we come back and rest. And then on Sunday, I climb it. So that is the last of my three. Yeah, it is a giant spike. I'm actually kind of bummed that that cloud is there, but it's the cloud doesn't go away. This is your picture.

Starting point is 01:29:26 Yeah. That's right outside of where I am right now. Wow. So how do you actually get there? So you just like drive up. Is there? Yeah, no. There's no car.

Starting point is 01:29:37 Actually, I'm in a city with zero. cars. We have to ditch the car, park the car, take a train in, and then the Airbnb that we have is like 20 minutes away. So we took this like a little electric taxi. It was kind of cool. Really cool town. Yeah. That's awesome. So that's my bullish on. I'm bullish on. I'm bullish on climbing the Matterhorn and hopefully successfully. Are you going to plan a big bankless flag up there at the top when you get there, dude? Of course. I never missed such an opportunity. Awesome. All right, Ryan, what do you, what do you, what do you blowsh on? You know what, despite this week and all of kind of the pushback and the anger about WorldCoyne. I'm not going to say I'm

Starting point is 01:30:10 bullish on WorldCoyne because I'm not, but I am bullish on digital proof of personhood. I just feel like crypto sometimes underestimates how much we're going to need this. There's this like huge meta problem that's hitting us right in the face right now, which is like we don't know who the bots are and who the people are on the internet. It's like on Twitter. I don't know. There's 500 retweets. How many of those are bots and how many of those are people, right? And I think that what tends to happen over time is if the bots have the level of speech that humans do on the internet, we can't tell human from bot, then it starts to fracture

Starting point is 01:30:47 society. Like, democracy's run on trust. Democracy is kind of a, you know, a conversation between all of its citizens. And if you can get civil attacked by a whole bunch of bots, if your democracy can be civil attacked in that way and destroy the fabric of trust, destroy. the conversation, then you could destroy democracy. I feel

Starting point is 01:31:11 very strongly that human beings should have freedom of speech on the internet, but I don't think that extends to bots. And so if we can't tell who the bots and who the humans are, we've got a real problem. And the status quo, the only way we know how to do that right now, is either you have kind of like the tech

Starting point is 01:31:27 companies partner with the government to do some sort of like state ID, driver's license, passport, AML KYC thing. I don't like that. That's what we're headed. That's like the default, right? And so that's bad for a lot of reasons. But I guess it's something. And I guess what I'm bullish on, though, is that we can get to a place. Crypto can play a huge role, maybe the fundamental role, in creating this stateless identity. And in order for a stateless identity, proof of personhood online to work, it needs to be decentralized, it needs to be permissionless, it needs to be uncensurable.

Starting point is 01:32:05 those are the things that crypto is really good at. If this type of thing doesn't come from crypto, where's it going to come from? No one else is building this. Silicon Valley is not building this. The tech companies aren't building this. So I've always felt like this with crypto, which is like act one is separation of money and state. Act two is separation of identity in state, right? Like we need both of those abilities if we're going to make it through the potential dystopian authoritarian scenarios that the 21st century is going to throw at us.

Starting point is 01:32:36 So I don't know how this will look. I don't know what kind of the best solutions are, whether it's kind of a social graph-based solution or something else, whether biometrics plays a role in it or not. But I would encourage us with all of the pushback on World Coin, and there are a lot of

Starting point is 01:32:52 good reasons for pushback to be had. Let's not lose sight of this use case of decentralized proof of personhood. I think we're going to need this one. And I think crypto has a big role to play. So, you know, here's a podcaster telling all the devs to go build something cool. But like, we got to go build something cool, guys.

Starting point is 01:33:12 Right. Anyway, that's my take. Great take. You want to get to the meme of the week? I've been waiting for this one. An old Gary Gensler meme that sort of fits in. David, did you see? Okay.

Starting point is 01:33:24 So this was like UFO week. I don't know if you caught. It's like somebody in Congress. I have just caught the tale of this. All right. I'm not tempted in. This is Gary Gensler, a picture of Gary Gensler,

Starting point is 01:33:34 our favorite. And he goes, all of these UFOs, they're going to need to come in and register. You're going to have to come in register. We're going to need you guys coming. There you go.

Starting point is 01:33:43 It's coming to my office. We'll end it there. I have no take on UFOs at this point as another thing. I'm just trying to... I mean, if these UFOs can just abduct Gary Gensler, that sounds like the more likely outcome.

Starting point is 01:33:55 All right, I'm not going to touch that one. Wrists of Disclaimers. Got to let you know at the end of every. bankless episode, of course, none of this has been financial advice. It's not alien advice. Nothing of the sort. You could lose what you put in, but we're 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.

Bankless - ROLLUP: Worldcoin Launch | New Crypto Bills | Twitter X | Layer 2 Wars

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