Chapo Trap House - 626 - Simian Slurp feat. Ben McKenzie (5/9/22)

Episode Date: May 10, 2022

Author, anti-crypto advocate (and yes, film & TV star) Ben McKenzie stops by to talk Cryptocurrency. We discuss the lies & fraud at the center of Crypto, the use of celebs to boost the scheme, and his experiences traveling to the Miami Bitcoin conference and a Bitcoin mining server farm to research his forthcoming book. Keep an eye out for Ben and Jacob Silverman’s forthcoming book. You can find some of their recent writing on the topic in Slate here: https://slate.com/author/ben-mckenzie

I Hello everybody, it's a chopper coming at you for Monday, May 9th, 2022 and Sadly, I have to begin it. I have to begin this show with a sort of a gentle admonition Sadly, a lot of y'all still don't get it. What don't you get? Sadly, you have failed to get that ape holders can use multiple slurp juices on a single ape What does this mean if you have one astro ape and three slurp juices you can create three new apes Still don't get it. Well, our guest today is someone who is trying to understand the apes and to slurp them We're joined today on the show by Ben McKenzie who you may remember from such TV shows as the OC and Gotham Ben

First of all, thank you for being here. My pleasure. Thank you for having me. What an intro. What an intro first of all Have you have you slurped any apes recently, Ben? You know, I haven't slurped apes recently I was so disappointed in the slurping because I really have felt I really thought slurping meant something else Maybe for people that aren't having sex. That's what slurping means. But you know to me Something else entirely. No, no, it's actually they're not mutually exclusive. Like, okay I mean, they I this is like kind of sad. I don't really like talking about my life that much on the show Like I just don't do it usually but I I should bring this up like a girl came over and Like after you know, we did the you know, I shook her hand and let her go to the guest bedroom

after that she like While I was asleep went to my desktop and put slurp juice on my apes She created three new apes out of the one ape. I had on my desktop and I was like I was like saving it for 18 I was gonna spend 18 years waiting for my niece to do that when she graduated High school that she could morph my apes With it with the mint juice event or whatever the fuck it is and now it's just like I either have to buy new apes or Kill myself. I don't know. I mean like the question is many apes are still un-evolved But we're doing that today

So Ben like you you've you've sort of become like a bit of an investigator into the the world of NFTs crypto and the mega Metaverse, but I want to begin today's show with a little contemporary news from just the other week This firms courtesy of the Wall Street Journal NFT sales are flatlining We're experiencing a complete collapse of the NFT market just from the Wall Street Journal They say the sale of non-fungible tokens or NFTs fell to a daily average of about 19,000 this week a 92% decline from a peak of about 22,500 I know sorry

225,000 is a December according to data from the website non-fungible the number of active wallets in the NFT market fell 88% about to about 14,000 last week from a high of a hundred and 19,000 in November Ben who could have seen this coming? Who could have seen it coming? It's a it's a beautiful market where they're selling These things called NFTs, which please don't ask me to explain what a frickin NFT is But it's definitely not an unregistered unlicensed security. I Have a degree in economics and this stuff drives me crazy Because what's happening is you're setting up so in NFT markets in particular. It's wash trading

It's all fake volume anyway, or most of it is you can create as many wallets as you want And you can sell these things back and forth to each other right making it look as though There's a real market and you could really like have value here and then you know When you've raised the price a suitable level then you you dump it on some poor unsuspecting sap and and the game continues It's some point You know even in a manipulated market you run out of gas because No, no, no, it's not a pun. I didn't mean it to be a pun I guess it could be a pun in terms of gas fees. Anyway, um, it's all you know, it's the book we're writing

I'm writing with Jacob Silverman Jacob when you're listening to this pot. He's a big fan of the pod and he's not on which is a testament to the fact that I Still got it. I'm a former teen idol You're the one you reach out to me not Jacob who apparently knows you guys and is like friends with you guys I guess or has played some game with you that okay I do Jacob like I don't see why he would be jealous because Jacob has played Counter-Strike Global Offensive with me, which is the only point of being on the show We we started the show to get me more people to play CS go with because it's hard to get five people when you're an adult and

They they won't let me go to high school Facebook groups anymore Dad for it to ask for players. I told them it wasn't any it wasn't anything weird I just why needed five people and Jacob's played with me. I guess he doesn't remember because he you didn't bring it up. He's like, oh, I'm so jealous I it's not like I've done the best thing any fan of the show can ever do and yeah on vertigo with Felix Yeah, Jacob. I mean keep this between us, but I think he's got a little Hollywood, you know, it's gone to his head You know, he's got those Twitter followers and he's like tweeting these gifs and stuff Um, yeah, he's a big fan of the pod I too am a fan of the pod. Thank you guys for having me on

I'll take it back to the NFT thing. Yeah, I mean the books about money and lying You know and I I joke that I know a little bit about money from econ but I know quite a lot about lying because I do it for a living and You know, they're lying. They're lying to you. They're calling it a currency. It's not a currency It's basically more like a security and a security, you know, we've had laws since the 30s on that because in the 20s the 1920s 100 years ago People were doing all sorts of crazy stuff, right manipulating the market and cornering the market doing all sorts of stuff Oh, sorry. I'm getting an amber alert on my phone

Um, if someone's a just got stolen someone they just got slipped somebody. There's there's a slipper alert Uh Yeah, so like they're lying to you and you know lying not great But when you're lying about money and they're taking like real money from you That's when I got I got pretty pissed off The last year a couple buddies of mine who I describe as like regular kind of like, you know Like upper middle class guys who have a little bit of money to play around with and so they're playing around with crypto And they're like, hey, you should invest in it. And you know, this is like last year. So, you know crypto crypto

It's everywhere. I mean still everywhere, but it was like the first big big $60,000 peak or whatever it was for Bitcoin. And so I looked at it and it was just like this is insane This is totally insane. Like am I crazy? Maybe I'm crazy. So I just I took Gary Gensler the head of the SEC He taught this class on Blockchain and cryptocurrency at MIT and he made it available for free online. So I took it. It was very bored the entertainment industry had been kind of, you know, put on ice so I had a lot of time moments and um And I honestly that did that that only helped me understand that I had more questions And that's still none of them made sense. And so yeah, long story short like last year

Late summer August I just I was like this feels bad because if I'm right then it's a Ponzi effectively It's like a new form of a pot like a decentralized Ponzi or Multi-level marketing thing if I'm right then like you need more and more people to get into it in order to keep it going Because that's a great value doesn't have any utility in it itself And and what happens is eventually you filter you start like with early adopters and like people who are sort of like techy and stuff And then you eventually you get down to like to major ad campaigns You know starring movie stars athletes stuff like that it hadn't even really kicked off yet It still we still didn't have the Matt Damon Super Bowl ad yet

That was to come only like a few months after I met Jacob But I just I hit him up and I invited him to beers at a You know Brooklyn bar and was like let's write a book on crypto and fraud and I think His wife was just about to give birth and I think he needed a reason to get out of the house And he was like, yeah, let's do that. But yeah, we've been collaborating ever since and it's been super fun Because it's such a crazy world you mentioned like Feeling like sort of a great behest of people who yeah, I mean there are just a lot of bag holders in this Like it and I would say it's like 95% bag holders

But I was kind of wondering this while watching the recent collapse this is particularly weird because Like the pumpers they're people who you'd expect it to be right? It's like Elon Musk It's guys who pop up out of nowhere who like bought followers and shit and then build an audience out of that But then you have a lot of legitimate celebrities who presumably do not need to scam people like you have Reese Witherspoon Like future posts about NFTs Jimmy Fallon Do you like like for someone like Reese Witherspoon? Do you think they're like in on the scam or do you think this is just a case of like celebrities just repeating things that were told to them?

Well, I would never say celebrities to do any of that and in the latter No, I mean my guess is you know, and and and I would like to I will stay generic here so as not to talk smack about any specific celebrity guy forbid, but um, you know, your agent comes to you and they're like, hey you can make X dollars by doing almost nothing And they go tell me more because it's not you know

The the big ad campaigns right the Matt Damon out of the Lear David out or whatever those liper on that those are all pretty straightforward, right? Like they get paid a lot of money in dollars To convince you to take your dollars and turn them into something else It's pretty straightforward Now you have to I don't know you I guess the truth is you don't have to do any deep thinking and that's probably what happened the NFTs are a little bit more interesting only in that the the Rumor

With some fact backed up in certain cases is that the celebrities are basically being given an NFT They're not paying for the NFT themselves. I mean, maybe some of them are some of them are but a lot of them probably not and They're someone is purchasing this NFT for them to you know, free publicity right now free publicity But publicity and everybody makes out all right celebrity gets their NFT that they have spent zero dollars on and hopefully sells it or whatever and It certainly didn't cost them anything and then you know

The the person who hired them to do that running whatever NFT thing they're doing they also get paid The only downside, of course, is that the other person on the other side who's bought them is totally gotten housed, right? Like just like yeah, that's good Well, I mean it certainly makes sense that like if you're gifted an NFT like I'm Both the you know, the people who are minting it and the celebrities it that certainly makes sense like yeah If you're gifted an asset you'd want to be like oh everyone should buy this Oh women need to buy women need to buy apes if women don't have the cool hedgehog collection. They're gonna die Yeah, but but like yeah, it just seems like varying levels of participation

I'm inclined to believe that someone like Reese Witherspoon who like I didn't hear from her for like 10 years and Then this is all she talks about now I'm sort of inclined to think that she really believes it totally possible I'm sure that's true of a number of folks. I mean what's interesting about this particular You know a thing that bears striking was their balance to other Ponzi's and multi-level marketing schemes of the past is that It did start out in a more You know, it was it was more of your tech forward people initially I mean well initially was used by drugs

Like at after that point you had a lot of like, you know Kind of people in Silicon Valley people who are sort of interested in technology and I use technology somewhat in quotes because technology here is not new, right? You're so cryptocurrency is you know, the Bitcoin white paper combined. I'm sure you guys know this but just for the general audience Combined blockchain This 30 year old technology from 1991 Stuart Haber and Scott DeBriere Stornetta labs with public key encryption, which is even older, which is 50 years old So, you know older technologies. It's a distributed ledger. You're encrypting stuff and putting it on there. Yeah, it's cool

It's interesting. It doesn't really work as a currency which they found out pretty quick You know because it's the proof of work like stuff doesn't really doesn't translate Into it's so energy-intensive that doesn't really scale so, you know along the way it's gained so much steam and one has to assume that It obviously has utility for things that are illegal Because it's operating outside the the regular system and it has utility as a speculative vehicle and people who got in early in This speculation have made a lot of money if they've cashed out So I think that Hollywood is not immune from that

I'm sure there's a lot of people who you know, not a lot But a number of people who have gotten in and made a bunch of money and once you paid a bunch of money You tend to believe in something a lot So for them, I'm sure it's it's it's cool. It'll be interesting to see how long that lasts, right? Today the market just like tanked and crypto tanked even harder and my whole theory is a guy who you know Has this undergraduate degree in economics 20 years old So I'm not exactly an expert, but is that this is all an easy money thing, right? The Fed has zero interest rate

There's all this money floating around obviously during the pandemic, you know Extraterinary measures need to be taken. I would disagree a lot with how they were taken but they were there and There was a lot of money to people to gamble with and there's a lot of like overlap and crypto gambling So, you know people are speculating when the Fed raises rates is doing now that should you know sort of collapse the system Yeah, I've seen it frequently like the common knowledge, especially among people like ideological Bitcoin people, right was That it's the world's greatest inflation hedge that it's it's it's better. It's better than gold and In the past six to eight months, that's turned out to be completely false Yeah, their only problem with that argument was was you know facts

Was evidence? You know, they just started saying it because I think the other things weren't working as well The arguments change, you know over time first it was like it'll be a currency, but then it didn't work as a currency so now it's It's the future of money, which is really funny because of course private money, which is what cryptocurrency wants to be right? It's not money issued by the state. Oh, so who's it issued by? Corporations basically effectively, right? So so instead of it being public money and money being a public good there instead gonna change it to private money

Well, private money is a thing we fucked around with in the 19th century It was a disaster. So it's not the future of money. It's it's the past of money, right? Even if it were to become a instead of company script, you'll be getting paid in company apes This is going exactly exactly. I'm sorry. I'm sorry time your your productivity on the line was pretty low No, Slurp juice is for you. No When it caught when a cop gets kicked off the force they slurp the juice right off the ape they un-transform the ape But I've been I was like to just go back earlier like, you know Like we talked about like the Super Bowl this like this this year when it happened and just like it did feel like that

That year in the Super Bowl were like the pets.com ad and everything was like a dot-com company It really felt that way, but like I'm like, you know, for instance the Ponzi schemes of your like it does seem to be like a key strategy to Getting people to buy is the endorsement of celebrities Like this would be like if Charles Ponzi like, you know, cut a radio ad with fatty are buckled or something getting you to like Buy buy shares in his company or whatever But like, you know, like Ben from your perspective and like, you know in the New York Times profile on you and the piece that you and Jacob did In slate, I mean like you I mean like you you've been at the forefront is saying like I'm a celebrity

Don't take financial advice from me But honestly like basically just like the first 20 minutes of recording. I would take financial advice from you Ben So, please What's what what stock tips do you have? Yeah, right. Well, what I would say is, you know If you can't under simple stuff is very important and we get lost We we lose ourselves in these speculative bubble phases that we're in right now or that were There were coming out of perhaps as we speak

And people get enamored of you know, they used to call it. It's they used to call it greed. We now call it FOMO But but you know people just want to make money and I get that who doesn't want to make money You should never invest in something you don't understand now Now crypto people would use that as like, oh, you need to know more about cryptocurrency to understand it So just just just you know, take this 100 hour seminar watch watch all 350 episodes of the podcast that I've done on cryptocurrency We're explain, you know, no, you need to Try to understand that what they're telling you is not true and it's not a currency And it's very strange to call something something that it doesn't do and it can't work as a currency

So what is it instead? Well, if as soon as you break that that would down that that wall then people start wondering well What is it and once you understand that it's a security that it's a stock basically or something It's a joint venture for profit, right? You don't do anything for it, right? You buy some crypto and you hope to make money on it. That's the definition It's called the Howie test, but it's the definition of security and we've had laws on the books for a hundred years Almost because nine years because a hundred years ago We had the roaring 20s and and the crash in 1929 led to the Great Depression It's really interesting to think about some similarities between those two

Sorry, I'm going to get real econ dorky on you, but like spit spit, you know, one of them is the adherence to the gold standard There's a great book Lords of Finance by Lula Quad Ahmed About the central bankers and how they basically contributed to the Great Depression By adhering to the gold standard and why that's interesting in this context Because so the gold standard would be, you know, your fiat your your money had to be tied to a certain amount of gold Well, you couldn't expand the money supply in times of crisis and so everything just shrank everything just collapsed in on itself And it's what's interesting about bitcoin is that it purports to be it wants to be something like the gold standard, right? Bitcoin argues that it's it's limited supply only 21 million bitcoin can ever be mine

Supposedly that that will create this value, but that's a deflationary Money that doesn't work it even if it worked the way they want it to it doesn't work And so it's really interesting that we're sort of literally sort of like copying something from 100 years ago Kind of renaming it kind of putting it through all of the the tech filters that we put social media filters, right? Selling it on Twitter and Instagram and tiktok, but it's the same stuff and they're lying to you and I don't Particularly care too much about rich people lying to each other and screwing each other over It's not like something that animates my just don't care that much But when it gets down to like selling your average person who doesn't have money to lose

That this is their way to emancipate themselves to like give themselves financial freedom It's it's gross. It's really gross and the celebrities are I think of them as the megaphone that's necessary At the end of the MLM Ponzi life cycle at because you need more and more and more people in at the end of it You get the biggest megaphone you can possibly get you get Matt Damon and LeBron James and Larry David and the frickin Super Bowl But as weird as that sounds In bubbles you usually at the end you go parabolic at the end it swings up like crazy And then it crashes like crazy and this is the crash probably you're seeing now as Bitcoin lost like

it's down like It's down now well over 50% just in the last six months as inflation is as geared up and maybe more importantly is the Fed is straight to raise interest rates People are gambling with this money But the money that quote this quote quote money, but it doesn't have any value because it doesn't do anything And that I think is something and I've been trying to express to folks But it's really hard because the marketing page. There's so much money behind them that it's hard to kind of cut through until it's Behind them that it's hard to kind of cut through until it starts to fall

And yeah, like sorry folks. Go ahead. I was just saying that the target like every every type of like MLM and scam and Ponzi Has a specific target like there's for MLMs where there's like physical sales It often seems to target like a type of middle-class woman like a downwardly mobile middle-class woman or like A bored woman on the second half of middle-aged kind of there are kinds of target like young men specifically This one is I mean, it is a great great scheme of our time because this one specifically seems to seek out middle-class people who are struggling to maintain the same standard of living as their parents They think that this is the the unstated thing is like, oh, this is going to be the same thing for me as like

Buying a house for $20,000 was for my parents, right, right? I think I think it's so so in fraud circles Um, it's called affinity fraud when you're targeting a specific group You're you're targeting a specific group easily identifiable. It could be could be racial could be gender or could be Could be age could be the elderly are often targeted And you what you do in order to appeal to those people is you pick respected members of that community In order to show for you. So, you know Tom sell excels you reverse mortgage on your house, right or whatever Um and maybe I shouldn't use the word fraud now. I'm going to get sued by a reverse mortgage company or whatever

But like, you know what I'm saying like you're trying to curry favor in a specific um Community and it's pretty gross because the way you do that is by taking a member from that community and sort of like Getting them in on it, right? Even if the even if most of the time they're not even aware of what they're doing Which I think has ramifications across the board, right? I mean, I don't want to say A definitively they're affinity frauds. But when you look at everything from women and nfts to, you know Spike Lee's commercial about, you know

Bitcoin atms the black community like the the dialogue is very similar The problem with all that stuff is that it's bullshit That's the problem. The only problem is the lying, right? If it were true, it'd be great But the problem is you're taking people who in some cases um, are living on the margins like you said or or are Comfortable ish but are then taking on so much risk that they're not necessarily aware of like the problem with bitcoin is not That it could go up. That's cool But the problem risk wise if you talk to a licensed financial investor which advisor, which I am not

Um, is that it could go to zero That you could lose all of your money. Um, and not just that They the the way that you buy it and stuff I mean, you can do it in a more traditional way, but there's a lot of like Oh, you just go to this website and click on this thing and then you do this and you do that and You're then you get rugpulled, right? You've created all these intermediaries in this supposedly decentralized system And people are just getting scammed and rugpulled like forget about whether bitcoin's going up and down just in the overall cryptocurrency market which there are like

20,000 cryptocurrencies or something like that, which is really crazy because if you think about it These are securities, right? These are effectively securities That's more than all of the listed securities in the entire us stock markets in all of the markets That's pretty crazy, right? And so you're just You know, you're just scamming people, right? You're just coming up with ways of taking their money They're real money getting to invest in some project, which is extremely opaque. They never reveal like who owns what or You know where the money's coming from

And then you're subject to the to the the whims of of whatever Thing they're pulling they're trying to pull off, right? And you can literally your your tokens can go from whatever value there are to You see it all the time. You see these charts in crypto. They're just absolutely insane Um, and you're right. I mean, I think they're they're I mean look to be real cynical. I think they're taking money from whoever they can take money from, right? I mean, it's like middle-class people poor people rich people black white Men women, you know, it's gotten pretty big at this point It peak was worth three trillion dollars on paper

If you think of it as more of a ponzi or an mlm or at least a speculative bubble built off of a ponzi or an mlm Then that's the biggest ponzi or mlm in the history of the world by an order of magnitude and and I just one thing I've noticed recently is that a lot of the um, the the the the chief proponents of like NFTs and cryptos and the people who have made the most money off of it Have like more or less admitted That it is a ponzi scheme and that's okay because someone's going to make money. Yeah, that's right. Yeah Yeah, sorry bill because it's it's not a currency then it like okay like well then okay. Yeah. Yeah, they're like sort of embracing it

Yeah, it is a ponzi scheme But at the end of the day if you're like the people who get in and like the top 15% are going to make the money And hey like as as the guy who actually you spoke to in the uh, that's in the new york times profile Where you visited one of the the bitcoin mining operation says to you at the end of the piece He says look life's a gamble and like all all find out like all finances involve taking risks and i'm comfortable taking risks But like yeah, yeah, of course he is Yeah, yeah, but if this is being sold as something that is like a revolutionary new currency or like the basis of our economy Uh, like it doesn't seem like that it's something that is less reliable than gambling on nfl games

Like this is this is not just a moral disaster, but this could lead to like a true financial disaster as well It could i mean at a minimum, you know if if i'm right and you know i'm humble I don't can't predict the future anymore than anyone else, but i see all the telltale signs of sort of It's not as big as the some the good news. It's not as big as the subprime crisis You know if even if on paper it's three trillion Or or was and now it's like half of that already bless you now. It's like one and a half. Um You know how much real money is in there? Not one and a half. I don't know how much but there's a lot of leverage being employed and people are

You know speculating. There's all these like lending programs. You give your crypto to one company and then they Mysteriously, you know, you give them the crypto and then they mysteriously create Return for you. That's like crazy return, you know 10 30 percent a year or whatever So when it falls apart, I don't think this will be the thing that like takes down the entire financial system most likely but the problem, of course, is you're sort of like Every time you say that you kind of go, I think I hope because you you never know until It falls like what's connected to what right because because we know this we never learned the lessons from 0708 Right? Like we didn't change the system. Everyone knows this, right? Like we can sort of intuitively understand that

Nobody went to it's not intuitive. Nobody went to jail Nobody like paid a price for it really except for the poor people who got mortgages They couldn't afford under dubious terms and I I'm worried now that we'll get sort of like a It's like a niche version of that where it's like specific people will lose all of their money And we're starting to hear from those folks, right? Like people who have like Their parents invested and got scammed and lost all their money and then Somebody's committed suicide. Like they're horrible stories, man. They're really bad stories because it's not it's all fun when it's going up When it's going down and you actually lose money that you can't afford to lose

That's when I get really pissed off because they lied to them with movie stars Athletes with the most famous people they could find and then you know, some of these folks are going to lose their money And you can't tell me it's their fault. Like I understand there's degrees and whatever But like you ask folks in crypto and I have I've been going around asking them like What do they because they always talk about the people that made money and I said, well, what about the people that got scammed? What about the big fraud it? You know what their answer is? Every single time their answer is they should have done more research Well, I mean, that's certainly I think like the pernicious part about making

Like the big even the big two cryptos like the big two cryptos Like Ethereum and Bitcoin like making them totally analogous to money I will say that like my stance my stance on NFTs is not really changed I think that they're they both represent like a sort of embarrassing 1970s type midpoint in an undeveloped technology that will Maybe one day represent a horrible new reality for like digital rights ownership But the technology just isn't there yet my stance on cryptocurrencies themselves though has softened a little just In the past year, I've I've been I did a fundraiser for like These Palestinian related charities and I had to work really hard to find things that like

You know weren't on some sanction list that could at least have a PayPal account that could at least have a A bank a bank that would accept wires from America because it's already incredibly difficult And we thankfully raised a lot of money and for a few charities it was pretty easy getting it to them Like it's usually a wire or a physical check But for the the one group that was in Palestine itself It was it was one of the most time consuming things I've done for something that should be incredibly easy In the time that I was trying to get them there part of the money They had three PayPal accounts seized for having the word fucking Palestine in it

But they had to shift around bank accounts because they like Weren't allowed to accept wires from America just because the financial system is so stacked up against not even enemies of America But like if you're not on our side, you're just you're just kind of cut out. You're just kind of fucked and you're cut out um and The reason that I say my stance softened is like I don't really think of cryptocurrencies as a currency really but just as like An unfortunately super volatile value store, right? If I had it, okay, like say that the

Right, the amount was like $40,000 say I bought like it would probably be like at the time like 90% of the bitcoin, right? And I'm like, okay, here you guys go And if they could have immediately cashed it out, which the problem is I mean there The problem is turning it into real money You still have to rely on the same like shitty financial system, but the idea of cryptocurrency itself I don't think is a bad idea and in retrospect. I cut like I I would have maybe tried that but then of course. Yeah, you have the same problem They eventually have to turn it into real money and that 90% of the bitcoin that you gave somebody in like, you know

Fuck in june of 2021 That could be worth that could go from being worth like $40,000 to being worth like, you know You know 22,000 right now, right? So it's you would all the things that make crypto fun for people Including the supposedly like most stable highest market cap ones are the exact things that make it kind of like Unreliable is an actual currency or just a value store. That's right And I mean, I think you're making a great point and the one thing crypto does do well is point that our system sucks You know, it's pretty good at the criticism part, right? Or at least some of the criticism Some of the criticisms actually don't totally track. But the the notion that we need to reform

You know the legacy banking system needs to be reformed that we need to figure out a way to do some sort of Sincerity resistant privacy have some privacy Elements and citizenship resistance in our in our currency Those are really interesting ideas and ideas that Jacob and I have been talking to a lot of, you know people were having fun talking to, you know economists and and professors of law and

and the like There aren't a lot of easy answers. I mean, I think that's the hard part, right? Is like what crypto's done is like for to use sort of your example of basically trying to To take something of value and transmit it overseas to a place that has trouble accepting things of value So that they can get the thing that they really need, right? Like we hear about Some people in Afghanistan using tether possibly or being sent tether the stablecoin It's used a lot because the banking system has been such a disaster over there

To do that is is You know has its benefits that I think the downside is that you are like you said the value fluctuates wildly and There's no It's it's it's sort of working because it's outside the law right now, right? But the the goal should not be to just create things that are outside the law Which also allow criminals to use them for all because if you can send it over then obviously, you know, it's being used for Um, you know, it's on a money laundering. It's you being used obviously ransomware. I mean ransomware is such a great example because

You know, it's really funny to hear like, oh, yeah That they're the ransomware problem. That's a problem with hacking It's like, hmm hacking has been around for a pretty long time and it's probably a lot easier to hack than most people think it is It's the problem you get is you need to get that You know you hack into the government database or the colonial pipeline that you need Millions and millions and millions of dollars of ransomware, right? Like you want to get money by how you get money immediately in millions of dollars So it's you could meet somebody in a home depot parking lot with bags full of cash, but you're probably going to get arrested

Um, and they track, you know, for every time they track down colonial pipeline, there's there's a million other You know ones that you know get away with it So ransomware really flourished because of cryptocurrency would be my argument and there's a lot of other things that are flourishing, you know tax evasion capital flight Sanctions evasion things like that there are sometimes pluses and minuses sometimes there are pluses like maybe we want to avoid Some government policy that was you know, it's terrible Uh, but like I I'm sympathetic to that argument and we're trying to talk to those people but it's really hard for me to

Separate that from what's happening in this country in this country in terms of most people They're gambling on something that they think Has value or infesting I guess you should say with quotes and something you think has value But economically it doesn't and so when it crashes, which I believe it will Those people are going to be screwed. So you know, anyway, that's a Clunky way of answering your question I guess Ben I'm curious like as you as you sort of become more of a like a prominent critic of of crypto and like nft and

In this whole new universe like I'm interested in like Uh, the people you've encountered the arguments you've encountered by its most uh fervent believers You know, like there is there's sort of a utopian ideology connected with this Like, you know, like we were talking about like this idea. This is a a new form of money This is a form of money free from government control. I mean like, you know, there are the uh Uh, the obvious sort of like a troll responses about like, you know, you're a no-coiner or like, you know Have fun being poor or whatever But like, you know, like what what like I'm interested in more of like the uh

In the defenders of this like not just the people who are making like millions of dollars on it but like and just sort of like the uh, the The scenarios are just like the the freedom that they imagine that this will provide like all of humanity like I mean like What are some of those arguments and like like how do you how do you um respond to them? Sure? So we went down to Uh, the Bitcoin conference in Miami, which is the biggest conference um in the world I guess in turn that comes to to bitcoin. Um, and we walked around the floor and I interviewed people and You know people have booths set up and I interviewed regular folks just attending. Um You realize quickly that it's not monolithic

Um, one of the things that I find sort of endlessly fascinating about money is that it's not real Um, you know money is a social construct just like government or religion It requires a critical mass to believe in it for it to function And so you see this you know because and and when it fails when when you know, all of a sudden people start to to uh, not believe in you know, the government and and then If enough people don't believe in it and the governments can collapse and the currencies often collapse right along with them as well as the economy um This is sort of the other side, right? It's like all of these promises

That cryptocurrency will do all of these wonderful things for each of these individual people And so they have their individual Um things they're fascinated by it's everything from Talk to one guy who's a former occupy wall street. Um guy Who his net he's an artist and now he paints these really elaborate paintings of um, like like a it's like a group of men's Seated around a table who are supposed to represent the bankers of the world um, they are pretty jewish

um and uh And there's a big bitcoin sign in the back and it's like, you know, we're taking down the system and you know in a long conversation um on camera recorded all this about you know No, it's like he's not any semitic This is uh the way that you know and and you're into some interesting territory, right? There's people like that there's also um the first booth I walked into at miami was uh Look, so it's on the outside. So it's like the less expensive booth. So it was uh panties for bitcoin

It's a father son team They've started a panty company that you can only buy panties in bitcoin because I don't know I guess I think the dad worked in the panty business or in the undergarments business And so he just knew how to probably get him cheap from china or something So they're selling you, you know, paintings for bitcoin. So there's a range, right? There's like there's like people who are like just It's like a trade show On one side It's like a get rich quick scheme on another for a lot for many people

If you look at the polling if you believe the polling um industry polling Then most people got into cryptocurrency in the last year in 2021 And most people got into it uh as speculation as a way of making money So that's the majority and most of those people have lost money at this point because you can look at a chart and So I don't like that part, but that that is you know, that that's probably the majority inside of it is you know everything from like super hardcore libertarian

uh ideology to to honestly what you would have think would be the opposite politically like a very sort of um progressive You know up with people banking system sucks kind of a thing that then I think gets Tied up into bitcoin and then um and then like also like um in the new york times profile of you Um, it's you know, it talks about how you visited one of these bitcoin mining facilities in texas Uh, was it like the uh the windstone us? Um, like what what was that like? I mean like what like I mean We can I can sort of like imagine it in my head like it's just like a warehouse of like these huge like, you know

Just hard drives worrying all the time that are liquidly cooled But like what do you just like describe what one of those facilities is like it was It was truly surreal. Um, so I grew up in austin uh where south by southwest takes place and um When david the reporter who wanted to do a piece on me suggested coming down I said, yeah, you know, we're thinking about going to a crypto mine and you know, you could come and So we we drove an hour outside of austin to a tiny little town called rockdale, texas

Which honestly, even though it's an hour and a half from austin. I had never been to um It is a very small town And the windstone facility has taken over what used to be an alcoa A aluminum smelting plant which I believe provided the you know the jobs back Back when they're used to have aluminum smelting in this country or at least there and It's on 33,000 acres

That have now been turned over um to To this mining facility and the main advantage of the mining facility is that because it was a plant It is connected to the power grid at a really significant And there's a big um, what do you call it a a transformer or whatever like there's a huge you can you can it can handle a ton of electricity And so they're running this massive operation where you go in and is truly astounding and you look up these are sort of football field size or even longer warehouses running endless machines and

um, he stepped into one so there is a cooling part on one side, but I was in another room Which was the original sort of technology. I don't I guess they hadn't developed the cooling yet And it's a it's it's probably about 30 40 feet in the air machines everywhere And it's it's at the top. It's open to the air can escape But it's purposefully not ventilated in the sense that there's no there's nothing pushing the air through necessarily actually want it to escape Up and out for some reason. I don't quite understand. So it's really hot It's like it was 105 on a pretty kind of mild day for for march in texas Um, probably 70 degrees maybe and the guy that was showing us around is quoting the article said it gets up to 125 in the summer

And and what you hear is this this this like it's like a it's like a million digital digital wasps or something billions of little this sort of low hum It's really quite it's it was profound It was it was disturbing to me in the sense that From my perspective as with a background in economics because it's not producing any value Overall because in economics this stuff is thought of as zero sum before you add in the electrical component You're just you're just gambling, right? It's like what you're talking about the ponsies It's like some people are going to win some people are going to lose but you just just gamble

There's no you're not creating a product You're not creating a revenue stream based off of that product, right? Like say what you will about apple or amazon or whatever But like they provide a good or a service and like you can you can monetize that you can evaluate that The price can go up and down but you can sort of have a sense of what that might be worth You can you can hold it in your hand like you can you can see that the thing that was like, you know Producer in some sense, they're either use of utilizing in some way. Yeah, exactly. And this isn't there's none of that It's it's it's just code, right? It's just code that exists on a blockchain somewhere

And they're running enormous amounts of electric of enormous amounts of Electrical energy are being used it is the equivalent of a medium-sized country overall the overall Bitcoin electrical usage is like the equivalent of I forget which country it is I think I think I think France I think was the one that like a nation the size of France like the Equivalent amount of electricity is being used for now all the bitcoin mining in the world and also but it is going up like exponentially Yes, well by design the hash thing keeps going up by design. It's a very It's an interesting we're trying to you know, this whole thing was started by Well, we don't know who it was started by it was started by someone calling or some people calling himself satoshi nakamoto

And 2008 When this white paper was sort of dumped on the world And it's an interesting thing to read. It's very short But it's it's sort of it's really interesting that this thing that kind of came out of nowhere and that no one Has with real evidence proved that they are the originator of there's some guy who's claiming he is but he seems like a Piece of work like most people in crypto. It's really interesting that they've created this massive thing It's like sort of you know, using up the electrical equivalent of France and It was supposedly worth three trillion dollars and no one wants to take credit for it. It's quite a mystery

I'm having a lot of fun trying to get to the bottom of it because economically It's just a real head scratcher. It doesn't make much more sense than sort of the tulip bulb phase of the You know the 16th century or whatever, but just in in your description of this like Giant facility. It's like 120 degrees on a hot day I'm running this like an ignore directly hooked up to the power to grade running an enormous amount of electricity to run these Like essentially computers that are solving math problems Um, the detail about how it was like, you know, it's in a town outside of Austin and the facility itself is in a former factory And like this hunts this this buzz this likes you described that a wasp like buzz

It's like is that the sound of like just the apocalypse happening? I mean like what is this like the feeling of like, you know Of a former factory like which would be you know, what you should think of is like connected to the economy But that like what was once a factory that I don't know how I don't how I don't know how Provided how many jobs for the people in community or no matter what they built That was like contributing to something of value to society It's just like this surreal image of like a former factory now Just like taking probably more electricity to produce kind of an invisible speculative asset. Yeah, it is it was like the Financial apocalypse or sort of capitalism reaching its end point, right? It was like we're just

Running machines and burning energy To gamble on there's no It doesn't do anything except things that you know, you couldn't do legally Um, so for some times we're better or worse, right? Sometimes to send cross-border payments like I acknowledge that argument That's a tiny percentage tiny percentage of what's being used here And so it's like really this is the best we can do. This is our way of of sort of it was it was dystopic I mean I I And and and sad to me because the main argument as a gentleman who was

Showing us around who was running the facility was making was jobs He was saying we're bringing in jobs and there were people working there and you could see them And I want people to have jobs man. I think jobs are good. Like I like that. I mean everyone hates their job but they should have one but We have to have something it you just brought to me Honestly, what it brought to mind was the old canes line You know canes are the line of like this, you know in times of crisis

Just literally pay people to dig holes in the ground and then fill them back up again I was like that would be better than this That would be use a less electricity give them a shovel and tell them. Yeah, you got to do it By the way, take your time. There's no rush because you're just going to fill it back up Um, but we're we have to find more productive uses for this incredible potential that we have in this country I think we've just really lost our way. I am getting really mad at It I believe that capitalism is eating our democracy. I believe that it has bought off both parties to some extent and

we see that in the Inability to do anything anything proactive seemingly that could possibly hurt What is termed innovation but is really sort of a redistribution from You know the poor to the wealthy or whatever or the wealthy getting more money. It's bad And I say that as someone who you know, I've I've profited from the system You know, I'll be it in a weird way as a former genital but like capitalism has You know, I think of it the way church will thought about democracy It's the worst system ever created except for all the rest like it's it's bad

It's not working and I don't know how to fix it But until we at least start calling out the lying and the fraud You know, at least it's a start, right? That's that's that's that's where I get to right I guess like uh, this is my last question here for you. I mean, it's just referring back to the new york times profile I gotta ask about this. It does say that you pitched uh, josh warts the creator of the oc on a reboot That would focus on beloved character luke ward becoming a cryptocurrency billionaire You said that was uh, that was a sort of tepidly received by josh. Yeah. Yeah. I mean, I was I was half joking Uh, it would be kind of funny. Um, you know, we'd have to get the show on the air pretty quick. I think for it to really land

Uh, but uh, but yeah, josh and I were joking around. I mean, I wanted to I when when um david the reporter asked me about that I You know, look to be to be perfectly blunt I feel like I have to use the tools at my disposal in order to fight back against a much more powerful foe So I need to use whatever public you want to call me ryan atwood. Hey crypto You want to do memes of me punching, you know, luke actually his character when then saying, you know, what I like about crypto nothing Great go for it. Like I'll even like it. I might even retweet it if it's actually funny, but like

We I have to do whatever I have to do in order to like keep it going So you want to you know to ride me or not you but like you want to sort of poke fun at me the fact that A former teen idol is somehow helping lead this cause against cryptocurrency. Sure Yeah, trust me. It's as funny to you as it is to me. It's ridiculous. It's totally absurd when I think about the fact that like I'm doing it. I'm like Really, they couldn't have found like ryan gosseling wasn't available. They couldn't have like figured out Like a much more famous and better actor to like To do this like this is that's how far down the list. They had to go was coming coming to me

Um, but anyway, I'll take it on a run with it and uh, yeah, oc reboot starting luke or his crypto bro coming to you So just just just just along those lines of you know, using using the the the tools and You're disposable to fight a much more proud flunery. I just like give you just like a little bit of a note here I think you have the right idea But the wrong character if you'd like to reboot the oc you need to make it centered around Seth Cohen becoming a crypto nft guy because he was bar none the most evil character on that show Seth Cohen was evil. Yes. Damn. I don't know this Whoa, do you have an ex-girlfriend who liked him or something out of cross right here? Like what happened?

No, just a current girlfriend. No, no, no Wait, wait, wait, why was he so evil? I want to know this now. Okay. Uh, he was um, there was just something about him Uh, he I I found that he was um, uh manipulative of your character on non the entire run of that show He he manipulated you and everyone around him with his like he just had this like um, like sort of uh Like like shy like quirky like nice guy thing going on But like truly he was a Kaiser so say like a manipulator and master master sociopath I love it. I love it. Yes. He was yes. He was and poor and Howard was no match for his his wiles Uh, yeah, yeah, Seth Cohen master manipulator

All right. Um, uh, Matt and Felix, do you have any uh, any final closing thoughts or questions for uh, our boy Ben here? I I do think the OC did pioneer I didn't want to ask you about it at first. I thought it would like For me, it would be like if you interviewed me and you were like so, uh Like what's what's up with like drunk driving or like not not wearing condoms like a joke I did like three years ago like no no one pulled for a recording to say that I did it last week but Uh, now that it's been brought up the OEC pioneered my favorite thing and sort of like high high middle-end teen fiction, which is

A certain character archetype that like stern Uh family patriarch who everyone thinks has like 300 million dollars and turns out to be completely bankrupt That's like the best type of character in young adult fiction I really think gossip girl changed the game by having the captain Nate Archbold be the greatest father of all time Uh going to rehab twice and decking his son while he was being arrested if I recall right but I think if You know, you just bring the OC back This would be a great new way for a bad dad to lose his money. So is this jimmy cooper? Is that yeah?

I think this would be a jimmy cooper thing This is tate donovan does his true who's like a sweet lovely dude in real life does his like slick silicon valley Yeah, I happen to have lost all of our money. I like it. I like it. I'm gonna pitch into shorts Yeah, no time like look if we're just if we all just like died In when obama was elected and we're just reliving the same eight years forever Why not do the best possible job we can at that? I agree. I agree completely. Well, look don't call us about this idea We'll call you we've got your number and I have a lot of kids I just have one question. We were talking earlier about how

it's sort of broadly assumed that all of these Celebrities who started showing off their apes Were gifted them by the different companies But that there is a possibility that some of them actually paid for their apes and I would just like to say that I need to know Which celebrities actually bought their apes with cash so that I can talk to them about all the awesome restaurant ideas I have that I would like them to invest in because I feel like I could have a real I have a real captive audience. I think they'd be pretty Easily persuaded if I could just get in a room with them

I think that's great if they could provide us with a short list of what they actually paid if anything That we will that will help us Understand where to target our with your restaurant ideas. I've got a bunch of ideas. I want to pitch them on They need to define Development of shows that I can be in or movies that I could start under stuff like that Or just give me the money whatever. Yeah, they should make an NFT That's like, uh, like the most famous woman in the world having sex with the most famous man And have it be real

That's right. Cade opt in in the rock If if you like see those people we can cut this out. I don't want to like I was it's funny. I was just about to go over to the rocks house for for a couple of quick quick tequila's Um, and some light lifting. It's a light lifting Guess I'll have to scrap that now Uh, sorry guys. I'm back my uh, my laptop frozen crashed immediately after I slendered the honor of uh, Seth Cohen So, I mean just less learned Pretty sure he got to you dude. Pretty sure

Yeah, ben I I just like to say that you were uh, comprehensively our most articulate and uh, like thoughtful. Um, guest We I think we've ever had so I don't See now you're just now you're lying to me because I I heard you on with Dave Weigel who I'm a fan of and I was like Well, he's pretty smart, uh But thank you for that sir. I appreciate it if you could just look all I need you to say is I'm the smartest former teen idol You've had on the show and that's all I need. That's all that's all I wanted out of this ladies and gentlemen That does it for chopper sharp house Monday, May 9th, 2022. Thanks again to ben McKenzie the most thoughtful Former teen idol in history. Yes suck it Johnny Depp

21 John Street google it kids. Okay, original Frickin new movies. Bye Bye guys. See you All right. Thanks. Thanks again. Yeah. Thank you. Thank you so much, man. All right. Thank you Oh