On The Brink with Castle Island - Weekly Roundup 12/10/21 (Congressional Hearing takeaways, 26% of Americans own BTC?) (EP.267)

Episode Date: December 10, 2021

Matt and Nic return for deals and news of the week. In this episode:  Are cubes a suitable holiday gift? Best crypto Xmas gifts Bitcoin purchases we regret The House Financial Services committee holds a hearing Our Congressional hearing MVP Brian Brooks' evolution SBF kicks off shoegate Takeaways from the House hearing EOS holders reject a payment to Block One Block One's weird pivot to Bitcoin Greyscale says 26% of American adults own Bitcoin Governance difficulties in Dfinity Will SWIFT survive American sanctions on Russia Impenetrable Sushiswap drama Those landfill Bitcoins are still lost Content mentioned:  Brian Brooks' testimony before the House Financial Services Committee The Economist, The Explosion in Stablecoins Revives a Debate around 'Free Banking' WSJ, Crypto, NFTs and Tungsten Cubes: A Guide to Giving Cash in 2021 Sponsor notes:  This episode supported by Public.com. Start investing with as little as $1 and get a free slice of stock up to $50 when you join Public.com today. Visit public.com/onthebrink to download the app and sign up. Corporations and institutions can allocate cash into Circle Yield to gain crypto lending exposure and earn superior returns compared to traditional markets. It's secured, overcollateralized and built on the leading dollar digital currency. Visit circle.com/yield to book a meeting

Brought down by bad mortgage investments, Lehman, which has 25,000 employees, will be liquidated. The federal government loans American International Group, AIG, $85 billion. This is a different kind of market, and the Fed is asleep. The federal government is stepping it to stabilize Fannie Mae and Freddie Mac, the two mortgage giants that have been threatened by the housing crisis. The Bank of England has pumped 75 billion pounds more to Britain's ailing economy with a new round of concentrated easing. You print a couple trillion dollars, and all of a sudden, people start to worry.

So out of this worry, we have something called the Bitcoin. Bitcoin. Welcome to On the Brink. I'm Matt Walsh. And I'm Nick Carter. And this episode is brought to you by Public and Circle. More on those companies later in the episode. Well, this is a, it's like, it's late.

What time is it? It's 10 p.m. Eastern. 10 p.m. Eastern. I just got off a plan. I'm in a hotel room. It's a shoebox. New York City shoebox. And you, you're getting up at what?

Like 5 a.m. to do a boot camp? Yeah, I got Barry's boot camp in the morning, me and the fellas. I didn't know you were Barry's guy. Yeah, this is a group here in Miami called the CryptoCats. Shout out to the Cats. And we do exercise together now. Wow. Wow.

You're one of those VC guys. It's like Keith Rabeoy teaching the class and you guys are just... I hope I run into them, yeah. So Barry's, it's tough, I got to say. I've never walked during the treadmill section. I've always stayed running. People walk? Yeah, if you're really feeling it, you can walk.

They kind of yell at you, though. I've never done it, bears. What's it like an hour? You're like alternating between like weights and then sprinting, and there's no breaks. It's kind of horrible. Does seem like a good way to start the day, right? Yeah.

Then you get brunch, you know, it's good. We're just powering through right here. All right, so this is a late night recording. Hopefully the audio is fine. I'm in a terrible, terrible recording setup right now. Yeah, there's also not any deals this week to talk about. You're in a hotel room. You brought it to your credit.

You did bring the recording gear with you, which was good that you remembered to do that. Brought the recording gear. It should be good. We should be good. Yeah, two deals this week. One of them was a deal that we did. So that was exciting.

We'll get into that. We also had a busy content week. So I sat down with Matt Cutler. founder of BlockNative talked about blockchain mempools. Blockchain Mempools, that's one of those things that if you're not spending a lot of time in crypto, you probably don't know what a blockchain mempool is. But BlockNative is all over that stuff. I don't blame you.

It's the transaction queue on blockchains. And so basically we're talking about front running orders and defy. We're talking about Web 3.0 versus 2.0. So that was a good one. And then in other Castle Island content, you were featured in a Wall Street Journal article this week about crypto-related holiday gifts. Yeah, you know, they didn't reach out to me. They just wrote about me, which I think is rude.

So they're about the cubes. Like, how have we, how do we not have equity upside in any tungsten cube manufacturing company? Like, what's going on here? The worst feel in the world is doing something big and not having equity in it. Like, why even live? Yeah. I mean, you've been talking about tungsten cubes for three years and we just don't have a thesis

there on. Why did I, why start a meme if you don't have financial upside in it, which is out of the goodness of my own heart? There's some like lower middle market private equity firm that is just taking your thesis to the bank on tunks and cubes right now. I know. I'm getting killed. The opportunity costs is immense. So the Wall Street Journal wrote an article about the guide to giving cash, like how to give cash for Christmas. People do that still? Yeah. And, uh, so. they talk about crypto starter packs. So like you can do a little coin base action there. You can give

physical currency, I guess. They talk about NFTs, not really cash, financial products for children, meme stocks, and then tungsten cubes. But tungsten cubes are not a form of cash, to be clear. I mean, they are kind of a store of value. I mean, they don't store value very well. It's hard to sort of redeem them. Yeah, I mean, why would you want to redeem them? Yeah, it's best to have the physical. So they did concede that I was one of the original champions of the Cube. So thank you.

Well, so this brings up a question of what is your go-to crypto-related gift that you're giving to, like, family and friends here? Well, so I think that WSJ got it wrong because the best crypto gift is obviously a lot. loaded up Open Time. It is. Yeah, that's a good one. Yeah, put a little Bitcoin on that.

It's cool. You know, it comes with Bitcoin. It's like this nice little artifact. You don't have to do anything with it. There's no accounts or passwords. There's nothing to remember. Open time is great.

I gave Dave Balter and his wife. I don't know if we're going public with names, but Dave and his wife, shut out. I gave them a paper wallet for their wedding. back in the day. I was like paper wallet. 2017 vintage gift and they're probably going to have a really good like 50th anniversary,

probably like buy a house with it or something. Why are you doxing them with this paper wallet? I've given away a truly infuriating amount of Bitcoin over the years. Yeah. Well, like a quantity that I can't actually think about because it's too devastating. So what I've always done with the paper wallet gift, so I've given the paper wallets to a bunch of people over the years, and I think it's a great way to get people into it. And you just have to buy the equivalent amount as soon as you give it. Like you have to just denominate yourself in dollars at that point and just, you know, hammer the buy button, give the paper wallet.

That was my mistake. I didn't replenish. I went to a Patriots game back in 2015, and I bought the tickets, and I went with four buddies. And I said, you can only pay me in Bitcoin. And Bitcoin was like $2.50 at that point. So it was like one Bitcoin apiece. And a lot of people kind of regret that move. Yeah, I'm trying to think what the stupidest thing I've ever bought with Bitcoin is.

It's basically everything that I ever bought with Bitcoin was a mistake. Yeah. Never gruts. All right. So let's jump into some deals. So there's a grand total of two deals. Two deals so far. I guess it would probably be more announced on Thursday, right? Actually, yeah, we're doing the Wednesday thing. You know the drill.

New stuff always happens on Thursday. By the time we release the podcast on Friday, it's out of date. It's always happens. So first up, we have TRM Labs. They are a leading blockchain forensics firm. They raise 60 million from Tiger Global, American Express, Visa, City, DRW, Jump, PayPal, Square, Us. Castle Island, Bessemer, blockchain capital, and others. Really excited about the TRM team. Check out the old podcast that we did with Espan. Old, I mean, it was just back in October. I was recent.

Yeah, it was not long ago. In crypto years, that's a long time. But TRM, just growing like crazy, just an awesome business. Doing a lot of work in the blockchain forensic space with financial services firms and governments, just an awesome company. So really excited to be behind that one. Yeah, happy we're on the cap table. Next one up is Swan.

Swan's a Bitcoin brokerage. So I missed this one last week, actually. So they announced this last week, and I didn't see it. And some people luckily hopped into my DMs to alert me. So they raised $6 million. It was from Mamesis Capital, 1031, Plan B Ventures, and others. Congrats to the Swan team. I feel like Swan employs half of Bitcoin Twitter.

So the big, big news of this week, it's got to be. be the hearing House Financial Service Committee. Yeah, so let's set this up a little bit. So Wednesday, there's a hearing before the House Financial Services Committee. They invited six cryptocurrency executives to testify. I'm always curious, like, how this works with who they call. So it was Sam Bankman-Fried from FTX. It was Jeremy Aller from Circle, Brian Brooks from Bitfury, Chad Kaskarilla from Paxos,

Alessia Haas from Coinbase, and Dinell Dixon from Stellar. And, you know, there's a bunch of back and forth. There's a lot to talk about. But overall, I thought they were actually really positive. Seemed like just the level of education that was portrayed in the questions was well beyond any of the hearings that I've looked at in the past. And in particular, I thought Brooks was fantastic. Yeah, the vibes were good. The GMs were flowing.

Brian Brooks was the MVP. No disrespect to the ultimate. other panelists. Generally, I thought, it quitted himself very well. But yeah, Brian was kind of the standout. I want to read some of his opening testimony. Brian's been around the block. He was the CLO Coinbase. Then he was the acting comptroller. Then he was the head of Binance, US, and now he is a CEO of Bitfury. So he's done a lot in the industry. And I think he's really come a long way. You know, I think I've said on the show before.

I was on a panel with him back in 2018, and he was totally against Bitcoin before China Fod. You know, so it's good to see him evolve on that. Travel the IDMAs. I mean, you've got to travel through the IDMAs. You can't hold people accountable for the views that they've had as they're traveling the IDMAs. I'd be a private blockchain guy forever if I was held accountable for some of my previous views. Yeah, I think I turned into a red tomato on that panel.

Like my face went cherry red. You're upset. I didn't like that. I had a cup of coffee with the big block movement back in the day. As a lot of us did. Speaking of which, we have to cover the outcome of the trial down here in Florida. Do we have to talk about that? Yeah.

All right. The MSM is not doing a good job of covering that trial. No, no. We didn't know wrong. So here's something that Brian Brooks said in his statement. And I quote, today, instead of focusing only on micro questions, such as whether a particular token is a security or whether a particular exchange traded fund may be offered, it would be worthwhile with the elected branches of government to grapple with the bigger questions.

Do we believe a user-controlled decentralized internet is better than an internet largely controlled by big, by five big companies? Do we believe that the financial services sector is any less subject to network effects than information in commerce were in earlier iterations of the internet. Do we trust big banks more or open software more, open source software more, as a tool for maintaining ledgers of account and allocating credit and capital? Can we recognize the difference in crypto projects failing for lack of demand, just as many publicly traded companies do, and crypto projects being scams, unworthy if being presented to the fair but sometimes harsh judgment of markets. He also asks, crypto policy should take into account not only the new

risks introduced by the system, but also the risk in the present system that are being solved by decentralization. Shouldn't we take seriously the possibility that algorithms and open source software that take a measure of human error, greed, negligence fraud, and bias out of the system, might also make the system better on net, even if there are some new risks that need to be examined, And understood. How good is that? That was pretty great. I think he's hammering a lot of the points that I think will really resonate. It continues to really shock me that the progressive side of the aisle here is not leaning into these crypto networks, you know, in a more aggressive way. Because if you think about all of the virtues of kind of public blockchains, you're talking about user-owned networks.

You're talking about the ability to hold your wealth outside of governments. You're talking about the ability to be less beholden to centralized intermediaries that are toll collectors. So I think he's hammering a lot of points that are like bipartisan in nature, right? So he's playing to the self-sovereign individual crowd, but he's also trying to throw a carrot to the Liz Warren crowd, although they probably won't, you know, take the carrot. I, yeah, I wasn't surprised by the squads take. Rashida Taleb, had a somewhat predictable line of questioning. on Energy FUD, which was directed exclusively at the representative from Stellar, which is like,

well, of course, she's the- Talk to the Mining guy, yeah. She's the most conflicted member. I mean, that's the guy whose job it is to mine Bitcoin. Here's another good line, Brian Berkside. Can anyone explain, for example, why Fidelity investments, shout out Fidelity, one of America's best-known investment advisors had to go to Canada to offer a Bitcoin ETF, or why physically settled crypto ETFs are safe and legal in Germany, Brazil, and Singapore, but not the United States. And what is the answer to that?

The answer is that we are being politically quashed. I think that's the only answer. I mean, has any ETF filing, we talk about this every week, but has any ETF filing been more comprehensive than the fidelity in BitWIS ETF filings? It's just, it's unbelievable how much data is behind those filings. The fact that we don't have a spot product in the United States is very embarrassing. There's just no deal breakers in there. I mean, it's buttoned up.

Imagine a synthetic commodity that's identical to Bitcoin, never respect, but it's just not called Bitcoin. It would get an ETF. Oh, we'd have triple leverage on it by now. Yeah, we'd have inverse 4X. So my other question about these hearings is,

how do you get to do the Zoom thing? Like, what's the situation where some people have to go and some people don't have to go? Yeah, so Chad Kaskeril of Paxos was on Zoom. It's just like, hey, I don't want to come? I mean, that's a pretty jad move, frankly. It's like, oh, Congress requests my presence. Sorry. I'm in Martha's Vineyard.

I'm busy. Yeah, I think that's a strong play right there. Yeah, I'm impressed by that. He got a little bit of flack about the Facebook integration, and I kind of liked his answer. It's like, look, it was a very small piece of our business. Like, get away from me. I liked how Sandbank been freed hadn't laced up his shoes. So he'd bought them.

Like, clearly it was like the day before. And they were like laced in the default configuration by the store. And he hadn't relaced them such that they looked like proper shoes. Yeah. that's fine i mean he's coming from the bahamas is probably a sandals culture so i think he stopped at a you know what's it called dsw warehouse yeah and just picked up the first pair of brogues that he saw and then he saw and slipped him on he's like okay good enough that's fine i go it's like steve jobs you know you don't really want to think about what you're wearing you just want to wear the same

thing every day it's not every day they has to go testify so it's a power move. It's yet another power move. It's, I mean, there was some good me and CMS intern had some good comments about just the fact that he had to sit down and actually do one thing for several hours. That must have been pretty challenging. So I thought that the general outlook was quite positive. There were questions from representatives asking about how stable coins would extend the dollars reach. There was a clear understanding that this is a largely U.S. best-based industry and we have to foster it and protect it. Really, the only critical stuff I

heard was pertaining to Facebook or pertaining to the energy stuff or fears about systemic risks. But by and large, it was much better or whatever Brad Sherman was saying. Just some nonsense, honestly. Yeah, so Emmer was really good, too. I think that he's really turning the corner. And I mean, you have to think that a lot of these politicians are seeing how much money Cynthia Lomas is raising from crypto people. And they have to be thinking, look, I don't know if I believe in this stuff. But certainly there's a lot of advocates out there. And this seems like a good wedge for fundraising.

But Emmer was really good, especially with the Sandbankerman-free line of questioning around kind of CFTC oversight and should we have a spot product. I thought there was some real positive momentum there. You know it's better than money is Twitter impressions. And the thing is when these politicians say pro-crypto stuff, they get love bombed. I think that more than anything is our number one advantage is just nailing them on Twitter when they say positive stuff. They love it. Or their staff loves it at least.

KPI is off the charts. Yeah. So we'll put the link in the show notes. to all the testimony, but nothing kind of major, certainly nothing alarming, but good show force for the industry. Let's move on to Visa had a little bit of an announcement this week. So they're starting a cryptocurrency consulting practice. They're going to start assisting their clients in just navigating the world of public

blockchain payments. And, you know, it seems like, I mean, probably very good idea. I'm sure they have a ton of merchants, a ton of companies that are asking, hey, what do I do about blockchain? Yeah, so did Visa come all around become the IBM blockchain? At least they're not doing it with like private chains. Remember like MasterCard's big thing a couple years ago was that we're going to create this great blockchain. It's going to be owned by us and we have no idea what we're talking about.

And Visa is at least building stable coin infrastructure. So from public chains to private, that's kind of the opposite direction. No, but at least Visa is saying like we're going to help you navigate this world. then we're going to, you know, teach you how to use these terminals for stable coin payments. You could imagine this being a very positive thing. So in other partnership news, Eric Schmidt is now a strategic advisor for ChainLink. That was not a sentence that I would have expected to hear, actually. Yeah, same.

It's actually kind of an impressive gap for Chainlink. That's a monster. get for Chainlink. You kidding me? Like whoever did that at Chainlink, whoever worked on that, give them a raise. That is a monstrously large get. I remember when

ChainLink was just the 4chan meme coin. I mean, I remember when Chainlink was smartcontract dot com or whatever that startup was that they started. Yeah. So there's this board on 4chan called slash biz slash

and Chainlink was like the most popular thing there for years and years and it didn't do anything and now it's made a bunch of those chanerous millionaires which is societally problematic my opinion it's yeah that what a crazy i mean that thing has come out of nowhere uh putting in that context getting started investing whether it's public equity or digital assets is pretty tricky these days on public You can start small with fractions of shares, invest in what you believe with any amount, exchange ideas with a community of like-minded investors. I've been using public.com for a little while now.

The thing I like about it is the social function and the investment-focused discussions on the platform. They also offer public equity as well as a number of digital assets. It's pretty handy to have it all in one place. public.com takes the privacy of the community very seriously. They don't participate in payment for order flow, which is a practice in which brokerages, sell your trades, third parties. They write your trades to the exchanges directly with no middleman. Start investing with as little as $1 and get a free slice of stock up to $50 when you join public.com today. Visit public.com slash on the brink to download the app and sign up. That's public.com slash on the brink. This is valid for U.S. residents

18 and older, subject to account approval, seepublic.com slash disclosures, not investment advice. If you manage corporate or institutional funds, you're probably looking for ways to access opportunities in crypto. You see the growth in momentum and want exposure, but a lot of institutions don't know how or aren't comfortable with the risks of Bitcoin or defy. Now there's a new investment that's built specifically to help institutions get into digital assets. Meet Circle Yield. It's a blockchain-based investment built with USDC, the leading dollar digital currency. Circle Yield is fully secured and over-collateralized with Bitcoin to protect your funds. This also makes it a great fit for crypto institutions who want to diversify their treasuries and reduce risks while staying on-chain. You get your

choice of terms from 1 to 12 months and a fixed rate that's higher than what you. what you'll get at a bank or in many fixed income markets. Visit circle.com slash yield to book a meeting with one of their experts. That's circle.com slash yield. Well, let's talk about another controversial project, EOS, the EOS community. So they have apparently, they've decided to halt a bunch of payments. So they're halting payments of 67 million EOS tokens to Block 1 and to Brock Pierce. And of course, Block 1 was the company that was started by Dan Larimer.

They originally built the protocol. you know they launched it Brock Pierce was early and it was one of the founders as well they raised four billion dollars in a token sale and now you're basically seeing a situation where the governance of that community is basically saying hey we don't need block one anymore why are we paying this rent and let's just not do it anymore all right i don't understand how this happened but i'm actually kind of impressed by it yeah and this is this is open source governance I mean, the more shocking part of this story is that EOS still exists. Yeah.

Anyone doing anything over there? Remember when EOS was the original ETH killer? I do remember that. EOS was well ahead of the curve on smart contract ETH killers. That was like the original ETH killer. There's no shortage of ETH killers. They just, they didn't pop out of existence, but they seemed totally off the radar. Yeah, this is an interesting one though.

So I think the EOS community is still going. There's not a lot of things being built on that is the thing. So it'll be interesting to see where that project goes. I think they're kind of an interesting spot where they just have a lot of capital, but they don't necessarily have developer mindshare. So here's what I was going to say. I forgot and then I remembered. In 20 years, no one's going to remember that EOS was a blockchain, I think.

They'll just remember the block one became a Bitcoin magnate through this mechanism of a blockchain that they raised for and eventually converted into Bitcoin for some reason. So, four billion from the raise. Yeah, so your kind of references to the spec deal and the, you know, Well, just the fact that Block one became a Bitcoin asset management franchise. Yeah.

know, just through all this, like that was the, that was the conclusion of the affair. Yeah, so for those of you who aren't familiar, so Block 1 was the company behind EOS. They raised a ton of money into $4 billion. They put a lot of that into ETH, and they subsequently put a bunch into Bitcoin. So they diversified into Bitcoin. So there is $4 billion to build the EOS protocol. So they built it, I guess. I mean, it doesn't really work very well.

Something built something. And then they took the company public via spec merger to build an exchange. And so it's called bullish. And the model is that they're building a centralized exchange with a uniswap-style AMM. So effectively, they are the counterparty to every trade and it's on a bonding curve. It's not in production, as far as I can tell. This is not like out in the wild yet, but basically just a war chest. And I guess, you know, does it even matter if it work?

is my question. Like these guys are sitting on an unbelievable amount of Bitcoin and there's no Bitcoin ETF. So this could potentially just be interpreted as like a long only Bitcoin fund with some upside if this exchange concept works. All I'm saying is history is just going to remember them as a firm that held a lot of Bitcoin. They'll forget about the fact that there was actually blockchain raised for a hot moment there. Yeah, it's just like no one's really going to remember micro strategies core business that they built some great software i'm sure exactly so that's that's our eos news of the week maybe we'll have some more we haven't talked about eos on this podcast in like two years so here's something else gray scale had a survey came out this week i don't know if i believe these

numbers. They claim the 26% of American adults own Bitcoin. Okay. That's very high. That seems high, but yeah, seems pretty high to me. So there's approximately 258 million American adults, which implies 64 million Americans hold Bitcoin. That's ludicrously high. Yeah, I wonder what the, I'm sure we could read the footnotes on how they do that. But I mean, you'd have to figure that there's a lot of people that own Bitcoin exposure indirectly. They maybe own a fund that has exposure to the underlying or something like that. Well, that's the loophole in all this, is if you own SPI or VTI, you know, any total market

index, you own Bitcoin. Yeah, you're getting into like micro strategy. Tesla. Tesla, yeah. There's also a way to kind of double count brokerage balances too. So you're looking at like coinbase users plus block file users plus Robin Hood users. You can get to a pretty big number there. So, you know, just for the sake of lobbying politicians, I'm just going to go with that 25 number.

It's a nice round number. Oh, to be clear, I would like the bigger number. Yeah, let's just go to bigger number. Bigger is better. and we're just for PR purposes, that's, look, it's science. Trust the science. Hey, look, there's like half the United States owns Bitcoin. Might as well.

The question is, when is it more politically advantageous to embrace Bitcoin than to reject it? Is it now? Is there an answer to that? I don't know. Maybe it's now. Maybe it's next year. There's going to be a tipping point, though. Well, I think we'll see.

I mean, look, these fund rates are. raising numbers are going to be pretty explosive, I think, for some, especially with, you know, we're aware of several of these PAC efforts. Like, there's a lot of capital being raised by crypto entrepreneurs to fund candidates that are pro-crypto. And there's going to be some of these candidates that I think wake up and think that they're in races that are not competitive, that end up being extraordinarily competitive. And they're going to have, you know, a lot of crypto entrepreneurs funding their opposition right now. So I'm pretty excited. I'm excited to see that.

It's time to primary, Brad Sherman. And just remember, both you and your spouse can individually donate the maximum. That's true. Separately. That is true. Don't forget that. So the economist had an article about stable coins that was shockingly good this week. I like the economist.

I don't know why you keep on taking knocks at the economist. I get it's a hardcover delivery every week for me. Has been for years. You get physically delivered? Yep, I like it. Spot Economist. So this one titled The Explosion Stable Coins Revives a Debate Around Free Banking. Basically, they assess whether stable coins resemble free banks, are those comparisons opt.

Of course, it's the favorite thing of our beloved financial regulators to compare stable coins to free banks in a pejorative way. we've covered the issues with that on this show. Yeah, we don't need to hit that bingo card again, but nice to see the economist hopping on that. But to their credit, the economist points out that there are successful episodes of free banking throughout history, not in the U.S.,

places like Scotland. They even shout out George Selgin, so the economist gets a dub on this one. They were correct. So Charlie Munger this week, came out and said that he wishes that cryptocurrencies had never been invented. And he also applauds China for all the moves they've done to clamp down on the industry. When you're in league with the Chinese Communist Party, I feel like something has gone wrong.

Speaking of just being in the pocket of the CCP, did you see that Ray Dalio thing on CNBC this week? Where there, Andrew Ross Sorkin was asking him, you know, about his opinion on various things and, you know, basically calling out some of the, human rights violations. And he talked about just equivocating. Really? Yeah, it was a tough look. I mean, every, all these elites are, you know, cowtowing to the CCP. You got Tim Cook, apparently information had a good article. He's signed some, some big deal with, with some Chinese, you know, covert deal with the Chinese government. You know, these people did not have our best interest at heart.

The crypto community, I will say, though, kind of, comes out and hammers munger it's like the guy's 97 give him a break i mean he's not going to like cryptocurrency that's fine yeah he's 97 right he's like old i don't he can't possibly mean 97 he's definitely north of 90 so there's interesting decentralization story this week with uh internet computer formerly known as definity or actually i don't know what the nomenclature is used to be known as Definity at one point. Yeah. Yeah, the DFINITY network with the asset called ICP.

I don't know. Yeah, this was interesting. So set this up a little bit. The copyright infringement issue. Yeah, ICP is just the wrong name for a coin because in my view, ICP is always going to stand for insane clown posse. Oh, yeah. The artists, I guess, to be generous.

So the problem is the nomenclature. There's always different nomenclature for everything. Like people can't standardize nomenclature in this industry. So, you know, for them, it's all about these canisters. And, you know, they've got different words for all kinds of stuff. It's kind of a nightmare. So anyway. there is a canister on DFINITY, which is, I don't really know what that is, but anyway, they received a letter for copyright violation because they are hosting some Nintendo intellectual property.

And then there is actually a governance vote as to whether the canister would be removed from the network. and this kind of caused a bit of a stir because basically, you know, if you can't have these messy human processes, these political processes, like how des centralized are you, how censorship resistant are you really? If there's even the possibility to be performing an active censorship on the network. So I'd say not a good look. It's, you know, this was actually the same thing with EOS. They touted the existence governance. the day you don't really want to put people in the position to have to make those choices in the

first place if you are making the choices something's gone wrong yeah so i i want to get some more information on this so what it looks like it happened was nintendo um is the party that was aggrieved here or things that they were so there's a copyright infringement notice sent from nintendo apparently to a node operator so and it was about a super mario emulator so basically it sounds like nintendo went to a note operator said you're running this thing, it's illegal. And then that kind of spurred this whole movement. So I don't know. I think you're right, though. It's any of these systems that you can target individuals and figure out who the node operators are, they're just going to be, you know, in the crosshairs here to the extent that there's a copyright issue, I would think. What I want to

know is how the heck did Nintendo know to go after canister, you know, ZMNPQ? 31, like how did the heck did they know, A, that this content was on DFINITY, B, that it was removable through, like, how did the heck did they find that out? That's what I'm saying. There's more of this story here that we're not seeing. Like someone is making a malicious attack against DFINITY. Like there's some sort of an inside attack factor here that we're not seeing because there's no way on earth that Nintendo just is monitoring DFINITY node infrastructure providers.

Did someone like put the content up knowing that Nintendo was particularly litigious? And they're like, hey, look what I found Nintendo. Super Mario Sunshine. There's got to be some lawyer somewhere that's like, hey, let me see if I can get some billable hours here. Elicit Luigi's located on ICP, canister. Crazy. Like, does Nintendo have like an army of these people just try?

the various corners of the internet for IP. Maybe, I don't know. Maybe it's like the music industry. Maybe the simplest answers. All right, yeah. Maybe they do. That was a weird one. We'll keep an eye on that one.

What do you think about this McKenzie Segalos piece? She wrote it on CNBC.com, so about Bitcoin miners and the Texas electricity grid. Yeah, big shout out to McKenzie Segalos. My opinion, the best journalist on Bitcoin mining topic. currently. She's written some bangers, and this was one of her best. It's about how Bitcoin miners are potentially ameliorating the Texan grid. It's the real counterintuitive thing. But Ted Cruz also tweeted this article out, so he liked it. I'm kind of worried that we just end up in this

partisan issue where if Ted Cruz likes something, then like half the country is just not going to like it. so I don't know. Yeah. I mean, Rashida Talab certainly disagrees with this analysis. So. Well, she also thinks that stable coins are securities. Yeah. But, yeah, we'll put this article in the show notes.

I thought it was very educational. And then I like the article from Michael Greenwald. So he is really becoming one of my favorite writers just around the dollar and how the dollar functions in a digital context. So he's writing a lot under the Harvard Belfare Center umbrella. He's at Tidaman Advisors. So he wrote this piece. Basically, it's about national security strategy for keeping the dollar the strongest

fiat currency and talks about how China is embracing blockchain, central bank, digital currency. Now, none of this has anything to do with public blockchain-based assets, but I think he's kind of moving in a direction where the, like, the recommendation is for the U.S. to embrace open innovation, public blockchain infrastructure to support stable coins in CBDC, you know, infrastructure. So I think it's worth a read. Certainly, this is helping the industry from the perspective of getting exposure to different pockets and kind of just exposing the idea of a blockchain-based asset, I think, is a generally net positive. Now, his views on, like,

you know, public blockchain assets are a little bit nuanced, I'd say, just based on his appearance on the podcast. I did, I found it interesting the members of Congress are now repeating the same talking point that stable coins can be creative to the dollar and support the growth of the dollar abroad. Yeah, I mean, that's where these ideas come from, right? Like these, you know, you got these guys like Greenwald writing these pieces that are very thought-provoking and these politicians read them. I think that's how it happens. speaking of which the U.S. is threatening to actually impose economic financial sanctions on Russia over their potential invasion of the Ukraine, which I wasn't even aware of until this week,

but apparently Russia is planning to invade the Ukraine. Do you know that? Yeah, so I saw that and there was something floated. I don't know. It's like, who knows how these things get floated, but that the U.S. was actually just going to weaponize swift overtly and just shut it down for Russia. That would be wild. So here's the interesting thing. I mean, say Russian invades Ukraine and the U.S. performed sanctions on them, so they just shut off all Russian banks. First of all, that causes Europe to freeze because then they can't buy natural gas, and so everybody just starves to death.

So that's one thing. Well, I don't know. I don't know. Like, there's a bridge between those two concepts. Freeze to death, not starve. sorry. I mean, electricity prices in Europe are absolutely skyrocketing right now. It's real issues over there. But here's the other thing is Russia now needs to find a way to transact with the rest of the world. What do they use? They can't use the dollar. What do they use?

Yeah, do they use like the Chinese digital central bank money? Is that an option? The crypto, yuan. Russia does have their own SWIFT thing that they kind of have been working on. They could use crypto infrastructure. I don't know. I think the U.S. rapidly erodes its own sanctions, you know, ability. I think the tool becomes blunt, the more they use it. And if they use it in this manner, it'll trigger a cascade of nations thinking, wow,

you know, I'm really exposed to the dollar here. They could really nail us. I think it's well past the point already where you know you already see these nations that see that Swift is completely weaponized. But, you know, if you were to imagine a scenario where Russia just gets completely cut off via Swift from the entire, you know, banking sector, the second order impacts there are pretty extreme. Like I think other countries will just immediately start to opt for alternatives. Like I think that puts a cascade in motion. I start to hedge at that point if I'm a nation state. Yeah, you only get so many bites of the Apple.

Now, what do you hedge into is a question, right? Because, like, Bitcoin, you know, that's not the answer if you want to be just transacting stable currency. What do you mean Bitcoin's not the answer? Take it back. It's not the answer for every use case, right? Like, there's no way on earth that that ends up being. This is a Bitcoin show.

It's not a Bitcoin show. It's a, you know, the, there's no way that that works, right? It's for Russia to just send stable value. So I don't know. It'd be cool to see Bitcoin trade against oil. That'd be cool. Well, that will happen for sure. But the question is like, what can you move that's actually, you know, relatively stable? So speaking of drama, there was a lot of sushi swap drama. But the thing is that it was completely impenetrable to be. And I couldn't understand a single thing about what was going on. Yeah. So the CTO of sushi swap, you know, bounced out of there. It seems like that whole community.

He's a lot of open source drama going on. It's good. Like the market goes down 20%. The knife fights come out. People just start hammering each other on Twitter, start saying really mean things to each other. That's what happens. So here's the problem with DAWS is that they have no structure to them.

And you have a bunch of relatively young folks that are entrusted with a lot of money. And then predictably, they just start stealing it from each other and doing graft. and you get like total nightmares like the sushi swap thing. There's no oversight. Yeah, just a pirate chip. Everyone's just shooting at each other on the ship. Yeah, it's anarchy.

It's totally anarchy. So someone's going to have to come in and clean up the DAOs. I don't know how that's going to happen. I don't know what the structure is possibly going to look like, but the DAOs are sort of not all right. Someone's going to have to come in just hostile take over these DAWs. Just run them. Install some HR.

you know yeah it's like rules and reg get in line and you need you punch in the clock you say you're working for the Dow I don't see you logging on today where's the proof exactly

get some eyeball tracking in there yeah it's hard to hold these people accountable working for the DAOs you know you get people working for multiple DAOs you have eight different Tao's going so maybe the future of work is sort of

deferred a dream deferred for now yeah it's like I'm going to you need to see someone aggregate the DAOs and just say, look, I need you in the office. Eight to five. You can still work for the DAO, but I need you in the office. 30-minute lunch break. We work at a stretch. But yeah. So that was completely impenetrable.

Here's an interesting story that no one's ever heard before. The New Yorker wrote an article called Half a Billion in Bitcoin Loss in the Dump. guess what that's about. Oh, someone who lost their keys back in 2014? So, yeah, this is, as I said, a completely novel story that has never been reported in the press before. Is this Welsh guy that lost apparently half a billion current prices worth of Bitcoin in a landfill, and he's been trying to dig it up ever since.

Still, yeah, sad for him, but he's had a lot of impressions. Yeah, I mean, the guys collected half a billion in media value at this point. So this is a long form article. It's full of really fancy words because it's the New Yorker. A lot of good vocab in there. And yeah, it's about, I mean, listen to it. Here's like a random sentence in the article. He was an ideal apostle for the techno-utopianism of the Bitcoin system.

like that's the only thing you're only going to read that in the new yorker you can't yeah you can't write that unless you went to a liberal arts college spoiler alert the coins are still lost they're still in the landfill he's not getting them out so i think that's it for the week um so we're courting on wednesday so not quite the weekend yet but um yeah would any weekend plans here how's the football team doing we've won four on the the trot. So actually, I think we're in playoff bound here. Yeah, you're six and six. I guess with the new week added this year, that's like, who knows what that means right now, six and six. This is another week? Yeah, there's an

extra week this year. Okay. All right. It's an extra week where my expectations can be dashed. Did you watch the Pats on Monday night? I did. All time game. They threw the ball three times. Yeah, and I don't even know if they completed a pass. Yeah, two for three. just in all time. I think they ran the same play like 11 times in a row. It was just one of the most unbelievable football games we were ever seen. And it was just because it was windy, right?

Oh yeah, the win was unbelievable. It was like you, you know, even you couldn't have kicked a field goal in that way. I mean, there was, there was a 33 yard field goal kicked, I think. Yeah, but it was. It was one of those things where it was like, to be able to kick a 33-year field goal into the win there. It's just, that's like kicking a 60-year field goal.

Yeah. I didn't realize that the wind could make it so difficult to complete a pass. Yeah, you just got to smash off football. It was awesome. It was a good game. So that wraps it. Do we have a podcast for a Monday? We do.

It's about charitable giving in the context of cryptocurrencies. It's a very good pod. No prizes for guessing who that's with. Yeah. So we'll be back on Monday. we'll have a good pod and we'll see everyone then have a good weekend and we'll see you on Monday