The Wolf Of All Streets - Binance Attacks | Prime Trust Bombshell | Crypto Town Hall With John Reed Stark, David Bailey, David Silver, Bruce Fenton, James Murphy, Chuck Mounts, Charles Jansen & More!

Episode Date: June 24, 2023

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Yo, can you hear me? Yeah, you sound good. How are you? Are you biohacking right now? I am, that's why I keep using my mic quickly every time I speak so you don't complain about the background noise. Are you freezing yourself right now or doing extremes? No, I'm heating myself right now. Gaurav's next to me meditating. He can meditate while biohacking?

That guy is multi-talented. No, man. He can meditate while I'm doing a show right next to him. That makes sense. I mean, I meditated with him every day. I don't know how we didn't end up connecting, but every morning in Dubai and pretty impressive. Hold on.

Hold on. No, no, no. You meditate my ass, man. There's no way you meditate well by meditate i mean attempt to sit still without yeah i'm the worst meditator in the world but i'm good for like three minutes i do try and gorov actually was this one of the people who convinced me it was important uh let me get danish up just give us a quick macro overview where we as we get the panel organized I think we should do that more often.

Yeah, I did it this morning. Just in good recap. As we discussed, it was good. It's good, man. It's good. Did you get a lot of hate from the macro guys about why we're talking about crypto? No, I generally, my approach to the finance spaces is like in the movies where you pull the pin out of a grenade, you throw it into the room, and then you walk away. So I don't know what they said after I left.

So you walked away right afterwards, did you? They were not hating at all, actually. I think we'll have them working. I told you, man, you're a very intimidating man. I've said this multiple times. No one believes me. But quick question. I've sent out all the invites.

There's no question. There's a statement. I've sent out all the invites, and Danish is up, so you can give him the mic whenever he's ready. Yeah, I think we should all the invites. There's no question. There's a statement. I've sent out all the invites and Danish is up so you can give him the mic whenever he's ready. Yeah, I think we should let him go. Yeah, sorry about the background noise. How are you guys doing? Just wanted to give a quick macro update.

Again, our shows are at 8 a.m. Eastern. So just a couple of hours before you all. You know, for everybody that's listening, we usually cover like more general finance. And then Scott comes in, drops bombs and then leaves. And it's like, OK, I guess we're not talking crypto. But as soon as he leaves, like everybody's talking crypto. But really quickly on the finance side, biggest news of the week, all of the deals that are happening between India and the U.S.

If I could tell you, this is probably one of the most consequential changes in posture by India and the U.S. If I could tell you, this is probably one of the most consequential changes in posture by India and the U.S. GE is now making engines, is selling engines to India. You know, Micron is making chips in India. India is now supporting AI efforts in the U.S. and in India. This alliance is building. And, you know, I know everybody thinks that China is the rising power. I'm not convinced. I think from an economic perspective, India is showing its merits right now.

Funny enough, just about half an hour ago, I was talking about Gaurav. He goes to me and I'm like organizing for the panel. He goes, Mario, how is India meeting everybody? Is Modi, who's the prime minister, is Modi in the US? Are they coming to the US? He's meeting Ray Dalio, he's meeting Elon Musk, he's meeting Sam Altman. And then he's like, Mario, we got to start doing your show in India. We got to get you to India. And so that was literally about half an hour ago, Danish. Yeah, it's quite impressive what's happening in India right now. By the way, we're building a consulate in Bangalore,

which is India's AI hub and tech hub. It's not by coincidence. I think there's this confluence that's going to happen in India. It's quite exciting. The other big, big news, I think, this week was around Fed Chair Powell's commentary around rate hikes. But, you know, that might be too detailed. He essentially pointed to the fact that there's going to be likely two more rate hikes this year and nobody nobody believes in. That's pretty much the other big news. And so the markets didn't really care about his comments? Yeah, the market does not care at all. I mean, there was a little bit of, this week might be the first losing week

in 10 weeks or 12 weeks, but nothing to worry about. It's not like a giant crash because of rate hikes. It seems like nobody's worried about it. And in fact, people on our panel today feel like there will be no more rate hikes. And I mean, this is a crazy prediction, but someone on our panel and people seem to agree, believes that we might even hit 2% this year. I don't

believe that at all in terms of inflation. There's no way, but at least the market is starting to think that things are going to start slowing down before they speed back up. Yeah, I literally asked them what they were smoking when they brought that up this morning i think but uh it is what it is mario we actually have some breaking news i know it's really early in the space but i do want to go ahead and mention this especially because we have one two three four at least five lawyers on stage if you're in a room with five lawyers we have more lawyers than call it itself uh On too many lawyers, but I love you guys. Scott, you there? This is the news

that just broke. Can anyone hear me? Yeah. Someone speaks out of the space and not crashing. Hello? Do you hear me? Yeah, we got you. Okay, you got me. So hold on. John, you can hear me. Yes, Scott just dropped out. Did he? Do you hear me?

Well, I can't hear Scott. Is Scott speaking? I can hear Scott. We can hear Scott as well. Oh, okay, okay. So Scott, yeah, Scott, I can't hear you at all. So after you're done with the breaking news, I'm going to remove you and put you back up in a few minutes. So I'm going to be quiet until you give me a heads up, Scott,

that you take over the room, but I can't hear shit you're saying. It's a heads up. Go ahead. Sure, I just want to quickly, there's breaking news. The United States Supreme Court sided with a Coinbase Global Inc. unit in a ruling that reinforces the ability of companies to channel customer and employee disputes into arbitration. The justices voting 5-4 ruled that lawsuits filed in federal court must be put on hold

while a defendant presses an appeal that would send the case to arbitration. Business groups rallied behind Coinbase in the case, saying that letting litigation go forward would impose unnecessary costs. Consumer advocates said judges should have the discretion to decide which claims should proceed during appeal, as courts do with other areas of the law. Obviously, we see this headline, you know, U.S. Supreme Court rules for Coinbase and its bid to halt court proceedings as company seeks to move customer litigation into arbitration. And this is the United States Supreme Court. We have five lawyers to tell us what this means. And I'll be quiet now, Mario.

I'll come back, but I'll tell you in the chat. Any lawyer want to jump in and tell us why this is important? I'm happy to jump in as the only lawyer who is taking Coinbase to task for this and survive where most of them can tell arbitration. Ultimately, this is a ruling that's probably right on the law, but it's terrible for Coinbase customers because you want your cases to be heard in the public.

I have over 150 current arbitrations against Coinbase. It's terrible that everything I do is behind closed doors. The world should know the issues Coinbase has protecting their customer assets. Instead, we get to see Coinbase go around the world and say they have no issues because these aren't publicly disclosed. Unfortunately, the way the law is written, the Supreme Court probably got it right. Coinbase was probably right. the only way you can get around the arbitration provision is to not actually be a customer of coin james i believe you have your mic up and jade oh good good no i i i didn't want to jump because

i don't know if i could just we're good yeah yeah i can yeah it was funny now as i'm gonna hear everyone commenting but i have no idea what the breaking news is because I couldn't hear you. But sorry, go ahead, James. Yeah, so this issue of forcing customers to go to arbitration goes back to Wall Street doing this after the crash of 1987. And so everybody on Wall Street put arbitration provisions into their customer agreements that you sign at the inception of the agreement. And the Supreme Court back then said that there is, under the Federal Arbitration Act, a federal public policy in favor of enforceability of arbitration agreements. So there's a long, long line of cases saying that these agreements are enforceable in arrangements like this. And so Coinbase is not an outlier. It's sort of following the lead, a well-tread path of broker-dealers across the country.

And if any of you have an account with anybody, Charles Schwab, Fidelity, J.P. Morgan, you have agreed probably to arbitration. So Coinbase has a lot of company in having this requirement. JW, then John, please. Yeah, this is not unusual. Coinbase is in the news because of the SEC's enforcement action. This case was pretty straightforward, straightforward application of the American Arbitration Act that favors arbitration. The empirical studies of the effect of arbitration have shown that customers tend to get more money faster when they go through arbitration than when they go through regular court.

The reason why lawyers often hate arbitration is the fees are lower, and that's part of the reason why the customers get more money at the end of the day. It's harder to charge 40% on a customer when you're going to arbitration than when you're going to a long court battle. And arbitration is much easier for customers to do on their own rather than needing to hire a lawyer. So it has its benefits. I don't doubt Coinbase has its problems. I've had issues as a customer in the past. Every major financial institution has customer service issues. But I wouldn't say arbitration is necessarily worse than what happens in court at the end of the day.

Go ahead, John Dean. John Dean and John Reed Stark, please. Uh, listen, this is fantastic news for Coinbase. It's bad news for the securities plaintiff's attorneys. I'm a plaintiff's attorneys. I've filed class actions before. So this is great news for Coinbase because they basically had what was considered the gold standard arbitration clause waiver of participating in class actions imagine a ripple loss or a judge saying okay you know xrp is a security or this one's a security then coinbase if they lost this case would have been facing a slew of class actions of all the different token holders for listing tokens, even if that token wasn't classified

because they'd be using the XRP case or any other case to say, look, it's substantially the same thing. So bad news for securities, plaintiff's attorneys, great news for coinbase and i agree you know for coinbase it gets to keep everything private because arbitration private hearings uh they're going to mark everything confidential and uh you can't release that information so if there is uh news that the public should know that is a a downside so other than that that's all i got to say go ahead john read start yeah i agree with john i agree with everyone i think this this issue though has been around probably you know the 35 years that i've been doing this it's a consumer issue you know um and it was often way long before crypto there's been all sorts of movements to stop mandatory arbitration because consumer advocates don't like the fact that it's secret.

They don't think people get a fair shake. They think it's balanced more toward the industry. JW might be right that studies have shown that it's not, but who knows? So I think it's one of those issues that's been coming up for a while. Congress always talks about getting rid of these provisions. And you see it in cyber sometimes because you'll have, like I remember with the Equifax data breach, they put together all kinds of remedies for the people who had experienced any sort of, who were impacted at all by any

potential exfiltration of data from Equifax. And they put in an arbitration clause and they got all kinds of hell for it because people just signed away. The victims of the data breach just signed and agreed to arbitration. Some of the lawyers just threw it in there in that agreement. So they eventually took that out. So it's one of those things that's at least perceived as not consumer-friendly, at least perceived as something that's secret. But what's annoying to me about it is already people are tweeting, hey, actually, John Reed Stark, you're an idiot. See, you're a

moron. Look, Coinbase just won in the Supreme Court. This is an issue I'm with the rest of the crew on. I think it was correctly decided and it's a matter of Congress to act to change it. And it's not good news for people with disputes. I think the arbitration, generally, I'd be happier in federal court. Maybe I'm wrong. Maybe I'd be better off in arbitration, but I feel like I'd be happy. I don't like doing what the industry tells me I need to do, whether it's the crypto industry or the broker-dealer industry. John, are you daring to imply that people just read clickbait titles and don't read the article and then attack? That's not incomplete information? I'm shocked. Yeah, it's about 99% of what people say when I tweet something, but whatever. But I'm with all the guys on it. I think they're all dead right on everything. Yeah. I know John and David both wanted to speak about this topic because it seems like it's not that, you know, obviously, like I said, the title is huge, but I don't think it moves the needle much in the bigger cases we're talking about. Go ahead, John, David. Yeah, just to wrap the bow on it, this wasn't

a challenge to Coinbase's actual terms of service. It was just a challenge to whether or not when Coinbase filed a motion to compel arbitration, whether they can stay the case or not. It's not nearly as exciting, sexy as anything in the realm of dealing with Coinbase. I do think that arbitration is obviously an abomination, but it's not a sexy issue. As the law stands, it's probably right. The only distinction I made, I forgot who said it, was unlike when you have a financial account where you go to a similar arbitration, where you have qualified arbitrators or in the financial field consumer arbitration versus uh arbitration when you lose money in a

security house is wildly different it's so much better i've done both i continue to do both but at the end of the day this is a outside of clickbait this has nothing to do with anything we're talking about the only thing that i would add is that for people to understand why some people are going to say it's bad for customers, I don't know what the average Coinbase account is, but when you're talking about individual arbitrations and someone has a $2,000, $3,000 account account as you can imagine if you can't put that case in addition to hundreds or thousands of other cases as an attorney uh they can't afford to pay by the hour because they're going to pay more than their account was worth in total and you're not going to make any attorney's fees on a two or three thousand dollar account so that's

i just want people to understand why uh there are going to be a lot of people that say this is bad for consumers. Cool. I think we've litigated that one, so to speak, to death. Yeah, I think, and my conclusion is it's not that big of a deal considering everything else we're going through. It's a fasting burger. Exactly, exactly. I know everyone wants it to be some sort of burger because it looks like it's good news for Coinbase, but it's not. And before we go to the important stuff, Scott, I just want to mention, we'll talk about the sponsor in a bit, but today's sponsor is one of my favorite. We've always talked about blockchain bringing, banking the unbanked, in this case, bringing internet to the people that don't have internet and leveraging the blockchain to do so. These are the solutions we were talking about many years ago.

So today's sponsor, the tweet is pinned at the top. We're going to talk about them in a while. Definitely check them out because I was pretty excited when I read that one. But go ahead, Scott. Yeah, I mean, to that end, I actually met Mickey from World Mobile at the Satoshi Roundtable in Dubai. We became friends. I've recorded a podcast with him. Absolutely amazing.

So I'm really excited to have that that conversation later we should probably do i would imagine here a very quick market update right uh although i'm looking it seems like actually the crypto market is somewhat flat which is a good thing when bitcoin is sitting above thirty thousand dollars everything kind of within one to two percent of uh price 24 hours ago so not to talk about there I think that the next candle is a green god candle up and I'll tell you why

it's a green god candle up because everyone's expecting this to be the resistant point that Bitcoin can't break and I don't know I think I think the point of max pain is what we expect the market to do next. Yeah, I mean, up has been Max Payne, in my opinion, ever since everybody went into bankruptcy last year.

To be honest, as much as I hate to say it, so many people lost all their money or tied up in Chapter 11 bankruptcies between Voyager, Celsius, BlockFi, and of course FTX being the biggest, that the higher price goes and the less money they get, the less their long crypto, sadly. Can I ask a quick question unrelated to the market? Scott, do you remember how when we talked about Binance and we had different attorneys come up on stage and said the order to freeze Binance US's assets, things will move fast and we'll see developments relatively quickly compared to Coinbase or FTX, for example. What movement have we seen? Is there anything worth noting at all?

Yes, that is our story. I mean, that's the big story today. Yeah, I mean, that is the big story. And I don't know if you want to finish your point there because then I want to go to James Murphy, Meta Lawman below, because he's been pushing on the Binance story pretty aggressively,

and he can give us that summary. I mean, in fact, let's just go straight into that story. I know myself, you and Mario, won a call last night, and we said, what do we think is a huge story? And we saw Binance actually going on the offensive against Coinbase,

sending out a very clear, against the SEC, sending out a very clear signal to the SEC that this time they've messed with the wrong person, the wrong company. Maybe James will take us through some of the pushback and some of the attacks that Binance... And James, for everyone, I've pinned the tweet that he'll be likely referencing above in the nest,

so you guys can check that out and see his thread. Go ahead. All righty. So the lawyers for Binance have filed a motion asking the judge to make the SEC lawyers follow the rules. And there's a rule that says in a case which is likely to attract media attention, counsel should not make statements that are misleading about the proceeding or likely to contaminate or taint the jury pool. And then they also cite SEC's internal code of conduct. What this all came from is everybody knows there was that hearing on the TRO, which was not a great day for the SEC lawyers because they could not identify evidence that Binance US was currently sending customer assets to CZ, to his entities in the Caymans or wherever. And it was not a good look for them.

And so the judge said, we need a consent order instead of a TRO. We need all the parties to get together and agree on maintaining the status quo pending the rest of this litigation. That happened. They submitted an order that they all agreed to to the judge. And once that was entered, the SEC immediately issued a press release. And in that press release, the SEC said that they had secured emergency relief in the case and that CZ, they intimated and very strongly implied that they had evidence that CZ had

commingled their word and diverted their word, customer assets, and that the order, the emergency order they obtained was, in their words, essential to protecting investor assets. So that was a press release that went out and it was tweeted out. And the lawyers for Binance said, hey, that's violative of that rule that I mentioned. It's misleading and likely to taint the jury pool. And so that's what they've done. And it's unusual. And it has additional heft to it because it is signed by Bill McLucas, who's a pretty big figure among the securities bar in D.C. He worked at the SEC for 20 years and served as the longest running head of the Division of Enforcement back in the 1990s, a long time ago, and then also signed by George Kanellos, who was also the head of the enforcement division at the SEC. And so this turns up the heat a little bit. Lawyers really don't like being accused of engaging in unethical behavior. That ratchets up the, you know, the volume in the case. Now, one could say that the

SEC started it, but if you have any children, you know, that's not actually a defense when your child says, hey, she started or whatever. But what has happened at the beginning of this case is unusual. I've never seen the SEC, when it files a case, send out a tweet with a picture with a bright red background where they drop the F-bomb. I have never seen the SEC do anything close to that. And what they did was they took one of the terrible, terrible emails that they've collected in the course of their investigation of Biden ads and quoted it. And, you know, it says something like, we are in. We're running an illegal exchange. We're running a fucking illegal exchange in the United States, bro.

Basically. Right, right. So I was going to say effing. But yes, you said that correctly. And so, you know, what's going to happen now? The SEC is going to come back. They do not like this narrative to take hold. And so while they have, I think, three weeks to respond, I think they're going to respond much more quickly, they're right. We made a mistake with the press release. We're really sorry. Please don't enter the order. I would say there's a 1% chance of that. Instead, they're going to say, we have the right to repeat publicly what we have alleged in

our pleadings filed in court. And that is true. You do have that right. And they will also likely point to a number of statements by tweets by CZ, Binance, the organization, Binance US, where they put their own spin on what has happened in court and in particular in that hearing. So there's going to be a fight about this, but I can tell you that, you know, it has an effect for Bill McLucas and George Canellos to publicly allege that the SEC is acting in an unethical manner in probably, arguably the largest case, the biggest case, most high-profile case that any of those trial attorneys at the SEC are likely to handle in their careers. So they really don't want a finding that they have in any way violated any rule or code of conduct.

Why do they care and why should they care? They're untouchable. They're effectively government-funded lawyers. I just think if I were them, I'd be sitting in a room and I'd be pushing my head off going, this is actually really funny and who gives a shit? Well, the concern is for the perception and their own personal careers. And so to have a court finding that you have violated a court rule and the code of conduct is significant. that on your career record that if somebody ever Googled you, because virtually all of the lawyers, just like John Stark and many, many others on this call, eventually want to leave the SEC, and they're going to go interview. And by the way, if you're in enforcement in particular, the first place you go to interview is Wilmer Cutler. And I know because I was

recruiting SEC lawyers who were interviewing at Wilmer Cutler back in the day when I was running my own law firm. We hired two dozen SEC credentialed lawyers. And by the way, if you just indulge me, I do want to say I have tremendous respect for the institution of the SEC. I hired two dozen SEC lawyers to work with me as my partners and every single one of them was high integrity, very, very smart people who are great partners in the law firm. I believe... What do you think? I believe... What do you think of the integrity?

I believe the SEC is right now suffering from poor leadership at the top. And that, to me, is the top. And that to me is the problem. I am critical of what the SEC is doing in some of this crypto litigation and very sincerely don't think it's right, but I have tremendous respect for the institution. You know, someone once told me, and I'm going to quote, and someone once told me, if you take a an ice cream a bowl of ice cream and you mix a teaspoon of shit into a bowl of ice cream the whole ice cream is ruined and for me that's probably a good analogy of what's going on right now at the scc you as i as i believe but the majority of the people which are great which are the ice cream the leader seems to be

poisoning the whole the whole the whole environment there and i think that you know you talk about the integrity of the institution i want to say that before three years ago i had great respect for the institution that was the sec under jay clayton today when i look at that in sec but to be honest um i think the integrity of the institution has taken specific my eyes a lot of damage and look i'm a crypto bro i'm in crypto so maybe you know right now they're fighting a bad instance and maybe i'm being a little bit emotional but i'd love to hear from other people what you think i want to do right i want to get john's thoughts to balance it out maybe there's a different way of looking at this and john if you can start with that tweet that i've

got open i've pinned it above as well. Red background. And the quote is, we are operating as a fucking unlicensed security exchange in the USA, bro, by Binance chief compliance officer. Yeah. You know, I do think. Did you mean John Stark or John Deaton? John Reed. Okay. I'm sure John Deaton.

I'll have to say all. Yeah, of course. We'll go to John Deaton right afterwards. But John Reed, the only reason I went to you, John Stark, is just because I think you maybe give us a different perspective, balance it out. Are we looking too much into this? No, sure.

I think everything that's been said is definitely, there's a lot of truth to everything that's been said. Here's my interpretation. First of all, having worked there for almost 20 years, including 11 years as the chief of internet enforcement, people filed motions all the time. I brought lots of TROs and lots of asset freezes and people file motions all the time and they can get very, very personal. The threats can range from trying to ruin my career to, you know, trying to kill my family. So all through it, you learn to let those things roll off.

But I think that's true. I think when you call the director, I also think when you call the director of enforcement out and say he's committed an ethical violation because of what he put in a press release, I think the SEC will take it seriously. And I think you're absolutely right that the SEC will file a very aggressive response. And, you know, when you look at that motion that that Binance has filed and Bill McLucas, I know him very well. I worked for him for at least seven or eight years, something like that. And he's larger than life. And he's probably the best SEC defense attorney on the planet maybe that there has ever been.

So I agree. His signature on that carries a large degree of gravitas. And he wouldn't sign it if he didn't believe it's true. And having worked for him, I think he does believe it's true. Because one of the things that I was super, super careful about, especially when I did his PRO, was if I was making any public statements, and I used to make a lot of public statements because the press calls you a lot after you do an asset freeze in particular. And because I was cheap, I got a lot of phone calls and was handling a lot of the media. And Bill McLucas and his successor, Dick Walker, were both very strict

about what you could say in a press release. And I wrote a lot of the press releases for the Division of Enforcement during my time at the SEC. And were very strict that you have to pull specifically from the pleadings. You have to be really careful about mischaracterizing anything that happened in the governmental proceeding. And I think there's a lot of oddities to this governmental proceeding. Normally, you bring a TRO. It's ex parte. The other side isn't there because the evidence is so bad. You feel like if you confronted with that evidence, then they would take the money and

run. So usually, you're in a judge's chambers or maybe you're in the courtroom. And I was often the main primary declarant in those circumstances of those TROs. And you testify to everything that happened and in those circumstances, those TROs. And you testify to everything that happened and the judge would grant the TRO. Then you go back to the office and you fax all the financial institutions and freeze everyone's money who's involved in the case. And then that person goes to court and says, you got to unfree some of this because I have to pay the electricity. I have to pay my employees. I have to pay my lawyers. And you work out an

agreement that is somewhat similar to the consent order that happened in Binance. Of course, the Binance matter to me is unprecedented because when I think back of all the TROs and asset freezes that I worked on, it was never of a multi-billion dollar financial institution. And they were never brought in open court. As I said, they were brought in secret and then granted. And then there was a TRO hearing 10 days later after expedited discovery to work out the details. So we're dealing with a lot of firsts here. And I think that… But, John, one question. When you say we're dealing with a lot of…

And for anyone listening, just the basics. TROs are just temporary restraining orders. So essentially, the SEC is trying to freeze Binance US's assets. But, John Stark, the question is that we're dealing with a lot of firsts. We had James mention earlier about the tweet with the red background, and you've now talked about how this is done in an open court. Why is there so many firsts? Does that point out to anything?

Yeah, I think it just seems like social media has changed everything in terms of how you publicize cases. I think the SEC has gotten very aggressive because of the constant attacks. You know, again, during my tenure, there was a time where the SEC didn't get attacked at all. Everybody thought the SEC was doing a great job, especially after 9-11, when Harvey Pitt was a chair and got the New York Stock Exchange up and running again. But then Madoff came, the 2009 crisis came, 2008, that crisis. And a lot of people blame the SEC for a lot of things, including even going back to Enron and WorldCom and Global Crossing, all of those cases. So I think that when you're getting

criticized everywhere, they've just taken a more aggressive stance. And that all comes from the top. And I think Bill's old school, Bill McLucas is old school. He's about as old school as it gets. If you hang out with him, he's a man of few words. And he's just like, this is ridiculous. In my day, we never would have made any of these kinds of comments. However, but let's take a look at the motion and try to figure out exactly what his ramifications are, because it certainly may prompt the SEC to become more disciplined and measured and muted, right? I think it certainly will in an admonition from the judge. You know, the order they've submitted officially says you've got to follow the D.C. professional rules of responsibility, and she might give that sort of admonition. But, you know, I listened and I read the transcript.

I ordered the transcript that day. I read it that day. I don't necessarily think that the statements that Gurbir Grul, the head of enforcement, made in that press release, which says, further, we ensure that U.S. customers will be able to withdraw their assets from the platform while we work to resolve the alleged underlying misconduct and hold Zhao and the Binance entities accountable for their alleged securities violations. And he says, given that ZZ and Binance have control of the platform's customers and assets and have been able to commingle customer assets or divert customer

assets as they please, as we have alleged, these prohibitions are essential to protecting investor assets. So I think, again, this is an incredible order in terms of the scope. It's as big, as intense, I think, as some of the restraining orders and asset freezes that I worked on. But the other thing dispute government allegations. The FEC may be withholding evidence because producing it could somehow compromise an ongoing DOJ investigation and now wants to show that evidence to the judge, which would be made easier if, for example, the DOJ accusations were unsealed. And when you accused, I think it was a good point, accusing the director of enforcement of unethical behavior, that's a serious charge. And my guess is the director was very careful with his words. And the DOJ's prosecution of finance would further buttress the support of the director's allegations and deter the judge from tendering any sort of harsh judgment or making any preliminary determinations. I was looking over the pleadings this morning on the docket, and it's still interesting to me that the primary SEC enforcement staff declarant, that declaration has yet to be unsealed. It's not even listed on the docket, but we know it exists because it's referenced in the

SEC brief supporting its motion. And if you look to the 11 times that Colby Steele, that's the name of the staff attorney, that Colby Steele's name was referenced in the motion, you'll see that most of those references pertain to the wash training and the manipulative behavior. So for whatever reason, when the SEC submitted that motion, they decided to file the declaration of Colby steel under steel. And maybe they did that because it had customer information on it and they were concerned about it, or maybe they did it because the DOJ asked them to, you know, the only thing that I know is that.

Let me, before John starts, before, before we continue, yeah, I want you to make that last know is that... Before you continue, I want you to make that last point, but I do want to, because we do have a pretty wide panel, but before that, before going to John Deaton as well, Scott, did you see the story as well that Binance is going to be testifying in the Brazilian Congress?

It just came out not long ago. Yeah, I was about to check it. It's not too major. I saw on one source apparently they're saying Binance is, Binance was utilized by pyramid schemes in the country to facilitate asset transfers. They'll be testifying in Congress.

I don't think it's a major story. It's nothing too concerning. But we're just seeing, I don't know if you would even call that a crackdown, a testifying in front of Congress. Mario, what I was talking about, I just wanted to make the last point that I want to hear what the other panelists have to say, because some of this stuff that I'm, some of these conclusions I have are purely subjective and just my guesswork. I worked a lot with FBI agents. I was an instructor at the FBI Academy for in-service courses, and we typically had an FBI agent embedded or working with our office or multiple FBI agents. We had meetings with DOJ and the FBI almost weekly in our office to give them updates

on all of our cases. I was part of the Commodity Fraud and Futures Task Force, which was a group of criminal prosecutors and investigative agencies and the SEC and the CFTC. And we met quarterly to talk about recent cases and what was going on. And I got very close with a lot of these agents. Some of them came over on the weekends with their kids to play with my kids. And so the communication lines were odd here because oftentimes if there's a grand jury proceeding, for example, the MVI can't tell you any of that evidence because that evidence is secret. If there is maybe some sort of undercover operation, they can't tell you about that.

If they've done a search warrant, they can turn some of that data over to you to help them examine it. But the point is, you have a very close relationship with them, but it's oftentimes a one-way street. So in this situation, my guess is that the FTC staff look at this motion and they sort of say, you know, to the DOJ, it's time for you guys to do something here because we need some of these great facts that you told us to hold back and it's time for you to file. Just like I think after the Voyager

hearing, my theory anyway, when Binance was going to buy Voyager, the SEC lawyer shows up and the judge says, stop telling me not to sell this to Binance. You can't just use hearsay to convince me of this. You have to file something. So John Deaton, I want to go to you and I'm going to let you respond to the conclusions that that mr stark came to and also i've got a question i'll bring it back to a question that scott asked or ran mentioned is that um gary gary gensler is poisoning the world that the the sec is not operating as it usually would because of gary and and they kind of linked it to the tweet that was mentioned earlier and other points that

mr stark made as well is that a fake? And then obviously you can comment on other things, other conclusions that Mr. Stark came to. Sure. Let me unpack it. First, yes. When you look at Gary Gensler, you look at the higher attrition rate of people unsatisfied at the SEC. I personally believe two years from now, for for sure Gensler's not going to be there I think he's becoming more of a political liability and he's a transient regulator uh it just because he says something doesn't make it so let me go to Rand first question then I'll on that on that comment so John on that comment so Gensler won't be there how would that work like what's the process to to to to get rid of Gensler? The process is he becomes a political liability.

At some point, Maxine Waters and the Democrats realized that this full-fledged anti-crypto and Gary Gensler being criticized by fellow Democrats, which is starting to happen in an election year. If it wasn't an election year, maybe I don't have that opinion. But I think he becomes a political liability and they simply he resigns or he gets a lateral move somewhere of some sort. So that's what I believe that brings speculation on my part. But it's what I believe. And the process will be impeachment by the House of Representatives, correct? No, not at all. The White House would just say, get lost, then give his resignation, right, Chuck?

Yeah, that's what I'm talking about. I'm not talking about any kind of punitive proceeding against him at all. Not at all. Oh, so they can easily... What if he doesn't want to resign, though? That's what I'm trying to figure out. What if he's like, no, I want to stay in my position? If the White House tells him to resign, he will.

That's everything. He told that. Biden's people tells Elizabeth Warren to call her friend and say, it's time for you to go away. The election is too important, blah, blah, blah. And he does. And maybe they promise. I just, you know, seriously, he's facing an ethics probe.

He is saying. That's maybe it's not an ethics probe. No, no. Yeah. It's yeah. Scott, do you want to clarify? Yeah, we were reading that. I just didn't want to. We were going to talk about that.

It's the New York Post, first of all. It's ethics scrutiny. It's a few people outside of government scrutinizing his meetings with SBF, which is not really new news. Just saying that he didn't register the meetings correctly on this Zoom call. There were no emails about it. Usually you protect yourself by sharing those emails, et cetera. And he didn't necessarily do that. But to be clear, it was broken as if he was being investigated. And that is not the case. Okay. So John Deaton, I know I interrupted you, so I'll give you the mic. Oh, no, that that's fine so let me unpack a few things uh first with ran's question of why should they care listen there are some brilliant attorneys at the scc but

there's also some that are not so brilliant and strategic they take the scc is great at offense they're not so great at defense i mean look how they handled me if i was in charge there i'd said ignore the dude on twitter instead they filed motions that I should be recused. I mean, kicked off the case, misled the judge about my comments, all of that because they're not good at playing defense. So they do care. uh what john reed was saying i think if there is a criminal indictment coming which i believe like others i think we're going to see it in the next three weeks i think that there's going to be coordination what john reed stark is saying where this uh essence the fcc enforcement director grew wall gets on the phone and says we have to unleash it now we have to show the judge we have to put this in context don't risk uh me getting some kind of order that says comply with the rules and so because you got to

understand there's a public court of opinion and then there's the court and this falls all into the narrative i think that they were aggressive in what they released because they're setting the groundwork the didn't um uh't Binance hire someone who was like chief of criminal division in addition to the SEC enforcement directors to come in and represent Binance or CZ? So the writing's on the wall. And so if there is a criminal indictment coming, I say we're going to see it in the next three weeks. And do you think the market would have ran? Do you think the market would have already factored that in?

Do you think it will impact the market much? I think if we do get a criminal indictment, we get a little bit of a candle down. But I think a candle that kind of recovers pretty quickly because the market's pretty much priced. I just get the feeling that everyone is on edge waiting for this criminal indictment that we have been almost trogher to believe is inevitable. I think

we get a red candle done and then we get a quick recovery. Yeah, I mean, listen. To Rand's point, FTX crashed in November. Bitcoin price was back above the point from before it crashed by January. Last week, we saw SEC enforcement action against both Binance and Coinbase and are now trading significantly higher than before both of those actions. Think about this. Basically, I think that

what you're going to see is they're going to say, oh, Binance, you thought that was bad. And then they unleash even more damaging evidence, the co-mingling of funds, all of the other stuff that they can point the finger at. And so- Yeah, I agree. I just think, John, from a market perspective, that now it's almost like every piece of news is a little less dramatic than before to the market because we've seen it and expect it, right? And so, I mean- Oh, no, I agree. And the market because we've seen it and expect it. I agree. The market's got to understand this is a lengthy fight. Look what Ripple did when they got sued. They hired Mary Jo White, former SEC. Jojo, what happened when Ripple got sued? What happened

with the markets? It went down 17 cents for a while. It dropped 57% in the first two days. And then within a few months, it had completely recovered. But nothing happened to the market to here. I think also, guys, we've got to be a little bit more cognizant

of what we're dealing with here. We've been through in the last 12 months, and I'm only talking 12 months, we've been through Luna, CRS Capital, Voyager, Celsius, FTX,

SEC Attack, Slimer, Cardio, SEC Attack, Binance. We've been through, I mean, you've got to kind of understand

what you left with here. I call what we have left here a bunch of rettop DJs that aren't selling for any reason whatsoever. It's like, I think if you were going to sell your crypto now, after everything that's happened, you probably would have sold. And I think what's left is the real believers. How much more do you want people to go through? And I think that regardless of what happens in the market now, I just think that, you know, hit me again. Come on, hit me again, hit me again, hit me again.

That's what it is. Yeah, and as those hits keep coming, you're going to see more traditional finance getting involved. I mean, Scott has said this. I said this 10 months ago on Charles Payne. You know, the blueprint here is they decided that they couldn't kill crypto, so we're going to crush it and we're going to get the Black Rocks and the Fidelity and the Bank of Melons and the NASDAQ and everybody else is going to come in and swoop it up at discount prices. And then you will see a softer approach when those traditional players... But then, my question, right, before I... Scott, I know you want to jump in.

I'll give you the mic right after. Promise, just briefly, your comments, are you talking about Bitcoin and the big guys, or are you talking about the entire industry, including startups? I think that, again, if you're holding altcoins, then the reason why you're holding altcoins is one of... So either you're still holding altcoins, then the reason why you're still holding altcoins is one of two. So either you're a complete retard, number one.

Number two, because you just don't care anymore. You've been hit into a position where you kind of say, look, I've lost so much money. I don't really care anymore, whatever it is it is. Or three, you've got a real conviction in the altcoin that you're holding that somehow the situation kind of resolves itself that's what's left but then the question would be but but ran the question would be in scott i'm really sorry last one but ran the question would be is that okay that's for people that are currently holding but what about new buyers like are they just being delayed and delayed by all this action or is it are they

looking at the markets now that i've seen the worst maybe it's a good time to come in and buy shit up mario you know what the best uh you know what what uh you know you know how nature works you know when uh when a woman gives birth it's probably the most painful experience of her life and she swears that moment that she will never ever ever give birth ever again and then she watches the kids grow and you know three months later she's asking her husband if they can have number two and number three oh scott he'll tell you um he's on number two i'm on number four now now i guess it's the same psychology the markets when the markets are going and we get hit we all hate this market and we swear to god that as soon as we can get our money out of this thing we're leaving you know what happens when the market starts running like the market starts running now wait if but if bitcoin runs

another five thousand dollars and we get to thirty five thousand dollars of that god candle that i keep talking about everyone's gonna forget about all the bad things that have happened in crypto and all the new money is going to come in because they're going to again believe the narrative that crypto is the best and hottest place to be. Rad, it's Jan Ahimsy. I might be able to add to this. Obviously, I write this Fund Flows report every week. We've had nine weeks of outflows, consecutive weeks of outflows,

totaling about over $300 million. Last week, we just saw, well, this week so far, we've seen $150 million inflows. So you're absolutely right. People are just seeing these large corporations come off to launch an ETP and suddenly they're piling back in you know And if I look at what they've added to it's just purely Bitcoin Ethereum and nothing else Well, that's what this is the largest Every cycle I watch yeah, I want absolutely I watch your flows. I watch your influence

I'm an avid reader reports and I I watch the inflows and outflows very, very, very carefully. And I realize that your market is very much a retail mentality market. Maybe it's a retail market, but it's a retail mentality market. I would apply. There's about a, I say, 15% institutional component to that. It's hard to calculate, but that's probably the best way of looking at it. Yeah. In the mindset, I've been watching your flows and the mindset of your investors, I guess

it's any investor is, at peak fear, they're heading and at peak hype, they're entering. And it should be the other way around. If you've been here for long enough, you know that it should be the other way around. Well, been here for long enough you know that it should be the other way around well it's a bit more complicated that because you get so we do have some institutional clients that find big amounts at this point when you see a ball run this this the art between the spot and the futures really widens out and they want to take advantage of that so they immediately buy the spot and short the future so that's why you also see shorts at this time, at this kind of time, pick up too. So there is some quite big instos participating in this at the moment,

like particularly this week, some people have had some really chunky single line inflows, which is an institution, not an individual. Yeah. So James, what would be your conclusion from this information? Where do you stand on my same question that I asked Ryan? Yeah. So Jase, what would be your conclusion from this information? Where do you stand on my same question that I asked Ryan? Yeah. I mean, I think it's a lot of it. A lot of the flow studies, sadly, is coincidental. It's not leading or anything like that. It's not telling you too much, but it does give you at least a feel for the sentiment of investors who have just flipped on a dime right they've been incredibly bearish and now a little bit news and they're piling back and that is human right and and that means it's a lot james

that means what it's just it's we see this very very commonly you know when i used to track flows in equities and fixed income it's a very very similar thing across other asset classes it's just the mentality of the investor, that the sheep maybe, maybe that's the best way. It's called investor amnesia. And you won't believe how much amnesia a $5,000 candle can create. Let's see what happened.

Hold on, guys. Two weeks ago, on the 5th of June, when the action happened against Binance, it was the end of crypto, people were exiting the space. Big VCs like Jason Caligianis turned around and said, if you're in crypto, pivot to AI. The article now is a good time to leave crypto. It was the worst time to leave crypto it was the worst time to leave crypto weeks later we're $31,000 in bitcoin

and crypto twitter is euphoric because tradfire is coming into crypto it's a investor amnesia and you know what i've learned you know what and i wish i could apply it a little bit better is just do the opposite of how you feel just we i feel always like just do the listen if you could if I had to buy bit accounts and one of them was what I feel and the other one

was the opposite of what I feel, the opposite of what I feel, I'd be a multi-billionaire today. I've written articles on that. The beginners should just counter-trade their own personal sentiments

and emotions. It's 100% true. But I do... And right now... Okay, go ahead. No, hold want to And right now And right now today it feels very uncomfortable to be buying ETH and it feels very uncomfortable to be buying altcoins and it feels a lot more

comfortable to be buying Bitcoin. What does that tell you? Yeah, I'm buying altcoins but that's beside the point. Hold on, Scott. You're buying altcoins, are you? Quietly. Hey, I didn't know. Hold on, Scott. Hold on, Scott. You're buying altcoins, are you? Quietly. Hey, holy shit.

This is, okay, this is, hold on. This is a breaking news. Guys, Scott, breaking news, breaking news. This is mental. I'm bullish as fuck suddenly. I'm bullish as hell now.

Ignore Binance, ignore Coinbase. Scott is buying altcoins. You never told me this. I also, for a month, literally for a month, said I'm just setting bids on Bitcoin at $25,200. For a month. And everybody said it's never going back there and this is whatever and it's boring.

And if it goes there, it's going straight to $19,000 and you're an idiot. I didn't share anything else and I just spent most of what I had on Bitcoin at $25,000. It feels like I'm still going to be buying altcoins now. Therefore, I think you should be buying altcoins now. This is not financial advice. This is long-term.

Long-term. I don't expect that. That doesn't mean they won't go down another 20%, 30%. Oh, it's altcoins. Yeah, yeah, yeah. But could we see? Could we see? Could we?

I'll let you share the story. Can I ask you one more question? With the crackdown, can't we see a lot of startups, right? Could we, yeah, I'll let you share the story. Can I ask you one more question? Like with the crackdown, can't we see a lot of startups just literally, literally go to zero, not because they fail as a startup, but because the crackdown forces them to go to zero. It's like, hey, you cannot for another couple of years,

for another three, four, five years, operating through a utility token will not work and we'll make sure of it. Is that a possibility? Which I don't think it is, but is it? Let me give you, let me give you the first argument that I have to what you've just said is, I think that the SEC has thrown its two biggest punches.

I think if you think about the SEC and they had two big bullets, they've now fired both of those big bullets. I kind of asked myself, where else do they have to go? They are after token number three in the pecking order which is which is xrp they are they they leave they have left coin alone but actually they could go for ethereum i'm not sure where exactly they would go are they going to sue talent the appearing foundation i'm not sure where they're going to go

and they've gone for the two biggest dangers. So, what's left? Where else are you going to go? What's the next action that you're going to do? Are you really going to sue? Are you really going to close down? Any action? What about stables?

What about any attacks on stables? There's a stable coin bill that's going into Parliament in a month or two months. Scott, you're much more on top of timing. It's one month. Next in July, at some point, McHenry has said that there'll be a markup period for some stablecoin legislation. We're also seeing that Lummis Gillibrand may be re-proposed a year later now, what they've said is it'll be a meaner, leaner version, and we'll focus on stablecoins. David Silver, I see that you have your hand up. I don't know if you had a comment on the stablecoin side. We'd love to get the guest's opinions on this. Maybe David's not there. There is a question that I wanted to ask very specifically, though. We have my two favorite Charleses, Charles Jansen and Chuck Mounts here from S&P. And obviously, you guys are listening to this, and I'm sure some of you are comfortably to some degree, but you guys are literally at one of the most trusted, the charge on the crypto side for S&P, period. And so what I want to know is, does this regulatory environment, this uptick in

enforcement action, which has nothing to do with you, does that at all shake your conviction or does that change anything for S&P's approach to this space? Hey, Scott, Can you hear me? Yep, you're perfect. Okay. Yeah. So, you know, from my perspective, I don't think it really changes our approach. It's just an additional piece of information to factor in on how we think the market is going to unfold and how it will influence institutional adoption in the space. And I think it's notable to look at the fact that you've seen these SEC actions and kind of this conversation has been really focused on that. But at the same time, you have now BlackRock filing for a spot Bitcoin ETF and the reemergence of applications from previously denied applicants. So it is quite an interesting dichotomy there on the regulatory side, but the largest asset manager in the world is taking proactive steps to kind of launch a new crypto product. So I think there's like elsewhere in the space, there's just a lot of competing and divergent trends. But the long-term trend to us is clear that the creation of this alternative set of financial

rails is moving forward and BlackRock has just demonstrated that. Yeah, I think we agree. That's why we've seen, I think the market sort of shrugged off the coinbase and binance action because blackrock came in a few days later and made the etf announcement and changed everything charles dance and i see you here as well i mean do you share i'm assuming you somewhat share but what what color can you add to that yeah so i i obviously share a thing chuck said. We were at Washington speaking with the Senate and the House just last week or two weeks ago.

It was very interesting to see the role of filling on both sides. So it seems when we discuss the idea of people leaving the U.S., it seems it's not really seen as a huge issue. It was not that it's before. When we had a discussion, it was before the BlackRock news. The feeling was that it's fine if people are leaving. When the regulation will be there, everybody will come back,

which could be true if it's done soon. It might not be true if it's done in 10 years. Overall, it seems that... So, you know, we're interested more in the stablecoin and the actual crypto finance market more than just Bitcoin itself. So they got this bill that is going to form market I think next week or around that date for stablecoins. That's something we've been following a lot and we're really interested in.

I don't know if you're interested to expand on that. Yeah, I mean, that's what we were literally leading in with anyway. So that's a nice sort of segue. I think everybody is curious what's going to happen with stablecoin regulation in the United States. It's the lowest hanging fruit. I think we all agree the most logical place for them to start but then we get these this rumor mill of oh they'll just choose usdc everything else be out outlawed or there will be you know no algorithmic stable coins which i think will be the case chuck i saw you lifted your mic as well i mean where do you think this is heading as we see this legislation actually finally hitting the floor?

Yeah, so, sorry, just before you answer, remember we spoke about that God candle on Bitcoin? Happening. Happening as we speak. $30,700. There we go. That was the candle. Anyway, let's get back to our regular program. Yeah, so the time we spent in washington

last week was really interesting and i had just a few uh pretty strong takeaways one was as you mentioned scott um the stable coin bill is going to mark up my understanding is july 19th um and so that we're going to get to the point here very quickly of a vote on progressing this. And the sentiment is, if it's a strong bipartisan vote, i.e. 60 to 70 Democratic House members get on board, including Maxine Waters, then the bill has a good chance of passing over to the Senate and advancing. And if it doesn't get a bipartisan kind of result, and that they can't, in essence, get kind of together on what seem to be some of the main issues, like, for instance, federal oversight versus state-level oversight, if they don't get the bipartisan vote, then it's kind of dead on arrival in the Senate. So I think that's the kind of landscape as we see it based on kind of our understanding of what's happening in Washington. And as far as the crypto market structure approach goes, I think that's going to be off for some future date. So it seems like all focus is going to be on stablecoins and it's going to come up to this bipartisan approach coming to be, if it comes to be, in the next month or two.

And just quickly on that, when we say stablecoin, remember we include all the bank issues, stablecoin, last time we spoke, Scott, we mentioned the one issued by Societe Generale, now Mitsubishi is issuing one. So we're looking at Chronoscope. Do you think that the stablecoin app, if and when it's passed, do you think

that that's bullish for crypto? And when I say crypto, I mean anything under Bitcoin. Or do you think that's just bullish for USDC, USDT and creating a digital dollar? Do you think that's just bullish for USDC, USDT, and creating a digital dollar? Do you think it flows into things like Ethereum, Tron,

I don't know, maybe even some of the dApps, or do you think that that's kind of like isolated for that section? Charles may have a different view than I do, but I think this is table stakes for the whole industry so I think having kind of clear policy formation and regulatory parameters are being set will be a very important piece of unlocking the flows of capital

into the crypto financial ecosystem in all its various fashions for institutional players Yes I agree, the only thing we're not speaking financial ecosystem in all its various fashions for institutional players. Yes, I agree. It's the only thing we're not speaking about any opinion on, you know, being bullish on the token price. That's not something we can touch on being where we are. Yeah, but essentially what you're saying is that we're talking about regulatory clarity.

We're talking about the herd coming in, the fall streak coming in. Well, this is happening and now we're complaining. Like it's not happening as we would like it to, but it is happening. And for me, I see that to be net-net. If you look at it from a thousand-foot view, that looks like a positive development. It's just going to be a few hurdles on the way.

We're not complaining. Yeah, no, it is the positive development for the field. It's really about the mentality of who is listening, right? So if you're an absolute Bitcoin maxi that just cares about resisting censorship, maybe it's not super interesting or maybe it's bad news, but you're more interested in having a new financial market that can thrive with DeFi and hybrid stages before that and have tokenization of real-world assets with fractionalization, better access to those different type of investment,

faster settlement, but still on public chains. It's great. By the way, as you just mentioned, Charles, I think part of the BlackRock news that's being somewhat underreported is how incredibly bullish they were in their last investor report on the idea of tokenizing real world assets. Absolutely huge. They've made a huge point to mention it. They're very, very supportive of doing that. And I know that obviously aligns with what you guys are working on as well.

Yes, that's a big thing, right? That's a quadrillion great's a quite really great yeah we're super interested in that part of the market and kind of going back to kind of the expansion of the crypto ecosystem through stable coins you know when we talk to many of our tradify clients you know they can't actually own or have stable coins or other crypto assets on their balance sheet. And so to the extent that you get a policy formation, a regulatory approach that facilitates that ability to bring those assets on balance sheet, then you're going to start to unlock the capabilities around expansion to the ecosystem, the flow of their funds onto DeFi rails, and also like the

creation of structured products. So it is, in my view, the beginning of unlocking the decentralized financial capabilities to the traditional market players and the hundreds of trillions of dollars that can ultimately flow that direction. So I think this will be, when we look back 10 years from now with our 2020 hindsight, we will see this as a pivotal moment in the evolution of the ecosystem. I agree. Matt, I'll have your hand up. Go ahead. Well, there was something left unsaid with that BlackRock letter that I think bears mentioning. not to fight anyone's bags, but Tron or EtcTokenPokedot as,

okay, and we will maintain who controls or who owns what on these chains that we do not control. I'm not sure about that. The unwritten word that I took away was they're going to retain control of who updates the ledger and who can add and remove from it. It can be done with the initial protocol. And we see, for instance, what JPMorgan is doing with project guardian is exactly that.

So there's a lot of project right now is always sweet to do. Two big type of projects. One is permission thing on top of mostly Ethereum, like nobody's speaking about Tron. And the other one is stuff like digital asset counting, which in a way is a bit decentralized. Nobody's speaking about Tron, but we're talking about stable coins

and the bulk of USDT is sent on Tron, which nobody talks about for whatever reason because it's cheaper and it's faster. But that is where people are sending stable coins. It's actually the default on most exchanges. Yeah, but just give more credit to Ryan. Bitcoin just hit a two-month high. It's at 30,800.

The team just sent it in the group. I know I'm a bit late because I wasn't looking at the charts like you guys. ETH is at 1,900. You know, I come here and I tell you that if we can light a candle and we get the candle while we're on the show, you know, we should do

more often. Yeah, well, we have... Okay, hold on. So that means when you talk about how sponsor and time medicine should pump, when you talk about how sponsor should blow up, I guess. I'll give you a list of projects we could talk about tomorrow. I'll give you my whole bag. But let's...

We are talking about the... Scott, can we talk about the sponsor, actually? Because this is a pretty exciting one. Let's do it in a minute. I just... You want to... You want to ride up. You want to get a fight going.

I know what you're doing. I'll try to do it. Before we talk about our sponsor, I think we just need to be just remind the audience that we do take sponsors and there is a pin tweet with all the details if you do want to i didn't pin it man did you did you pin it although i didn't do it did you and you should put it more yeah i usually do but i'll bring rome hold on romey from the team you should be listening to this you didn't send it to me romey i know you're listening when you send it to me to pin, Romy, it's your fault. But yeah, so just, I'll pin a tweet. You can email us.

Mario, hold on. Whenever you come on, yeah. Are you having an MRI? Are you having some aging? Look, guys, I'm doing biohacking, but I slept 14 and a half hours. I woke up really late for this, so my schedule is screwed up. So I apologize for the background noise. I do have a life, and I'm

doing some biohacking. But what I'll do now is I'll retweet it on my account. You can retweet it on your account, and then I'll pin it. But this is, so if you want to come on as a sponsor, I'll let you shill it as well, Ran. But let me, if you want to come on as a sponsor, there's an email in that tweet. I'll pin it at the top. It's on top of my account, and I'll pin Ran's one

as well. Can you retweet it so I'll find it, Ran? And I'll pin Ran's one. And, yeah, you can email us there. You can DM us if you can't find the email. It's not working. It's easier for you, but we prefer emails. But, yeah, go ahead, Ran. Okay, Scott.

Scott, actually, over to you. Maybe you want to introduce our sponsor. I know Mickey's a friend of yours. Well, listen, Mickey would be here anyway. I want to be very clear. Mickey, first of all, what's up, buddy? But you're invited any day to these spaces, period. I want to give you guys some context because Mickey, you can listen to my podcast with him.

We've spoken, but I'm in the Waldorf Astoria in Dubai. And these guys, I start talking to these Krua guys as we were, it's a small conference. And they start telling me the most amazing story about Africa and the adoption of crypto there. But this insane story about a village in Africa, it's become my favorite crypto story period where basically they went in, they dropped this thing, and then all of a sudden came back after COVID because they were locked out and this one piece of equipment had effectively transformed this entire fishing village. And they said, well, if you really want to hear the story, you got to meet Mickey, right? And so Mickey and I started talking and I just absolutely love it. And it's the story, obviously, of sort of the inception of World Mobile. I mean, Mickey, I guess you could do this much more justice than me. If you could even just tell that one little story. I know it's not what the point is here, but it's so incredible

to me. Sure. Hey, Brian. Hey, Mario. How you doing? All good? Oh, good. Tell us the story. No one cares about us. Go ahead, bro. Okay. Yeah. So around three years ago, we decided that we were going to run our first pilot. It was in Tanzania, Zanzibar on a small wool fishing village. So we started to look at how to lay down infrastructure, how to power that infrastructure. And we came up with something called an aernode. This aernode was solar powered. At the top of it, a solar array or on somebody's hut.

Underneath that was a repeater. Underneath that was a Wi-Fi unit. Underneath that was some second life batteries. And underneath that was some charging boards. So we were expected to put this up for a month or so and go through the impact of internet before we really went out and made World Mobile something big. We couldn't last a month.

We ended up lasting seven months, eight months because of COVID. But when we arrived in this village, first of all, nobody spoke English. There was around 120, 130 people there, mostly fishermen. And those fishermen would wait for a trader to travel 60 or 70 kilometers. You're not talking normal roads. You're talking 60, 70 70 kilometers which is a long journey uh and they they would hold that fish until the until the trader came or they'd end up smoking so this is what we knew about the village it had one pub uh bar shop um and that was it

we returned back seven months later the film crew went in and they called me and said look we're not in the right place so i said you see our nodes said yeah i said you're in the right place what we understood from that moment onwards there was around 300 people in the village the fishermen had upgraded all their fishing nets there were two or three pubs at this point one or two shops and just because of the street light the connectivity and the power when when it went dark at night time previously everyone went to bed seven o'clock eight o''clock and if they're lucky they had a home service system. What we managed to do was stimulate the economy where actually

you ended up having a lot of people staying up late at night selling their items, selling their goods. When we returned to that village we also had 3 or 4 people that had learned to speak English and German from Juraligo. So that was really the catalyst for World Mobile Grow. Yeah but also then the fishermen were able to sell using the internet.

Jerry rigged the one piece of electricity unit to give the entire village lights. We put up two nodes, right? One on either side. And then what we found out, that one of the nodes stopped working three or four months in. The reason it stopped working is because they were very clever they managed to take copper wiring and then start to light up their houses or light up the shop with this copper wiring but of course it wasn't built for that so they ended up um breaking the system when we got there they said look we won't do that again but i think the most impactful was the real-time communications between the fishermen and the traders biggest the biggest business in this particular village they were now able to message the trader and say to the trader hey look

i've got this fish sending him pictures or sending her pictures the trader would then see it worth coming and was a guarantee that the fish wasn't smoked when fish is smoked or seafood is smoked it ends up using 10 10 10 percent uh 10 times the value excuse So the increase for the village was absolutely crazy. And of course, they decided that they weren't going to hack the systems anymore. So Ricky, just maybe for a lot of people here in the room who don't really know what World Mobile is, how it works, maybe just give us a quick rundown of exactly how the product works.

Are you guys still with me? Yeah, yeah. So you can't hear Ryan. Yeah, I'll bring Ryan down and up. But essentially what Ryan's asking is, can you tell the audience what is World Mobile? How does it work? For anyone that doesn't know,

because we forgot to do the introduction. Okay, yeah, sure. And I've done you a favour as well. I've just pinned, or it's not a favour. We do it all the time. But I've pinned you a tweet with links and everything there and a bit of a summary for anyone that wants to check it. But go ahead, man.

So, let me start with the problem. There's 3 billion people that are totally unconnected to the internet right now in the world. There's probably another billion that are connected to 2G. 2G can't really do much except for make a voice call or send an SMS. In addition to that, there's a bunch of people still connected to 3G. You couldn't have this call on 3G right now, right? You can't have a Skype call. You can't have a Zoom call. You can't really download videos. It's a very slow method. So non-meaningful internet probably affects

five billion people in the world but three billion people are totally unconnected you've got the world bank united nations the international telecommunications union the gsma and they all recognize this is a massive issue for the development of any country any individual it affects education health and of course prosperity right so the most unconnected continent on the planet is africa and that's what everybody thinks that with around 850 900 million people in sub-saharan africa you've got around 70 percent unconnected from the internet but actually it's not just africa if you take the united states of america you have around 10 percent of the population unconnected and 30 percent of the landmass and if you look at all the other countries around Europe and the other continents, they're all plagued with the same issue.

So the issue comes from legacy infrastructure and legacy business models. And oligopoly own the communications network. They own the spectrum. They own a lot. So what we've done is something very different. We've brought in something called a sharing economy into this space. You've heard heard of airbnb you've heard of uber um even you heard of helium you know and they proved that there was a shared economy their business model was wrong i believe in terms of the connectivity layer and giving out tokens when they weren't in a steady state

in the startup state so we chose to do something very different but essentially world mobile is a new economic model to incentivize people to put up infrastructure where there isn't any and the incentives are quite big because the telecommunications industry is over a three trillion dollar market worldwide and that's without value-added services so it can be absolutely huge so but how does it i'm asked a stupid question so how does it really work without getting too technical? Like how, when you say you leverage the blockchain to bring this to the, not unbanked, but the people that don't have internet connection. How does that actually work? What does the blockchain provide?

A lot of the bureaucratic layers of telecommunication are done by huge teams, right? Customer service, customer support, smart contracts can take a lot of that away. bureaucratic layers of telecommunication are done by huge teams right customer service customer support smart contracts can take a lot of that away international border settling smart contracts can take a lot of that away but i think it's much deeper than that so right now as a mobile network operator some of them i'm not saying who but you can go and look on google they know everything about us right they know when we wake up when we go to sleep, who our friends' friends are, where we bank, if we use Bitcoin, if we don't, because they have that passing through them in plain text

in most cases, right, due to regulations. And that's not right. The regulator needs to know what you're doing. The government needs to know what you're doing. But actually, a mobile network operator shouldn't know what you're doing. Now, if they do or they don't, that's not for me to comment.

Again, it's on Google. But what we've done is as a as a blockchain operator at our core we're able to prove that we cannot see these things that your data is your data at the end of the day you're paying it it's you right it's a digital imprint of your own self you have a right to it so we've used ssids and we've used um dids and all types of methods in order to be able to actually give you your data and make sure that nobody else can take it from you. And then you have an option. You know, we never promote that you sell it because I wouldn't promote yourself. But you could give it for a donation. You could rent it.

You could do whatever you want. At the end of the day, it's not our choice what we do with your data. It should be yours. But before I not... I've got another question. Rand, Scott, I know you've got questions as well. I'll give you the mic right after this. But, you know, I've got Imran Khan, so the former prime minister of Pakistan,

coming on my show in a few hours. And the reason I mention this is that Pakistan will be a perfect market for you. Is there any other countries outside of Africa that you're working with? Because we've used Africa as an example. We're in four different continents. So we started in Africa.

It was born in Zanzibar. Zanzibar was a great place, very accommodating for us to be able to fine-tune our share in economy. And fine-tuning it sounds like an easy thing, but actually bringing infrastructure, showing people how to use it, telling people they've got to keep it plugged in, giving them the rewards of running that infrastructure is not an easy thing. So we've been spending the last two years doing that. And actually, I can go into this later. But in Pakistan, we've taken the same approach as we have in Zanzibar, except when we don't have 50 people working there, we have zero. It's exactly

the same shared economy. It's a cookie cutter approach. And actually, we've seen real big growth over the last couple of weeks with nodes going down with people paying for the network and yeah you're right it's a it's a 200 million plus people um who all suffer from either bad service or very expensive so pakistan is definitely something we've been focused on for the last couple of years and finally the shared economy launched there last week but yeah i mean this we've kind of talked about this before but aren't you isn't your model a major threat to the some of the biggest incumbent companies on the planet i mean you're talking about telecommunications

on one on one level it is right because the people power is much stronger than than any single uh company if you look at facebook you look at microsoft you look at google um you look at starlink they're all trying to fix this problem it's probably the greatest problem the last problem to fix for mankind that we can fix and half the world being unconnected is is just wrong everybody should have the right to the internet if we didn't have the internet we couldn't have the conversations that we've had or the communication that we've had or even listen to this so on one side it can be perceived as that on the other side it's a massive help they've got huge amounts of problem with their network you know they buy their infrastructure if you want to become a mobile

network operator a big one what you typically got to do is go out there with a billion dollars in your pocket spend 200 million dollars on licensed infrastructure then another 200 million dollars of marketing then you've got another 200200 million to spend on your team, and then you've got the rest to be able to continuously roll out where the patches are. World Mobile, very different than any other DY in the space, we support those mobile network operators. We bridge the gap and fill the gap for them.

So in the United States of America, for example, I said 30% of the landmass is unconnected. 10% of the population is unconnected. That's crazy. 9 million children don't have internet at home. So the mobile network operators four or five years ago, when I first came to them, just laughed. And then the last couple of years, they said, oh, this is interesting. And then as of this year, we're actually speaking to some of the biggest mobile network operators on the planet and they need the help they need the support they want to provide service and more than that the FCC and other regulatory bodies are enforcing that they use their spectrum are enforcing that they do connect the unconnected are enforcing that they do provide

equal access to everybody so So companies like World Mobile actually provide a massive solution to those. Yeah, you guys had a big announcement yesterday, right? I believe we have big announcements every week, but I believe yesterday was the buyback. And, you know, that's just testimony that the network is working. And it's exciting on many levels.

Exciting for our community, the people in the shared economy, exciting for theode operators um in the shared economy as well because money's coming in into those but most of all it's exciting because actually you touched on this 30 minutes ago there's a lot of um i think rand said it you're saying to be holding uh uh a token right now right an altcoin the reason is because they're mostly speculative 99 of altcoins a future a little bit of good tech um maybe a fonzie nothing is really happening in the real world beyond speculation and trading but our people on the ground doesn't matter if there's a bear or bull market they're buying internet they're feeding the system they don't care they don't know they don't even need to know anything about crypto

so it's a very exciting situation for us where actually over the next month month or year we will actually be coupled no one will care the same amount of revenue or more will continue to grow into the network and that will come back to the shared economy, the people that are running the infrastructure, processing the blockchain, running the call. Hey man, let me ask you a selfish question. Even if you're a sponsor, I don't care. I'm going to ask a tough question. What do you think, how are you dealing with the current market conditions,

with the current sentiment, with all the regulatory crackdown? What does that mean to you on a personal level and be honest be genuine let's say like no we don't care how is the utility token it must be tough how are your investors reacting well i think we were pretty smart so we decided to do things differently the actual connectivity layer the air nodes they don't touch crypto they're just there they're just functioning they work those people get paid in normal fiat currency you cannot expect to be a mobile network operator that connects hundreds of millions of billions of people and we've committed to connect a billion people by 23rd i think we can do it much faster with the with the charity how much how much how much have you

raised to do that um we we distributed during the tg around $38 million worth of tokens, and we're still in very good shape. Okay, and you've raised anything before the TGE? The founders put all the money in. We put around $5 million, $6 million. But the founders, the respect. Mobile network operators, for example, you've got James Tagg, your co-founder, invented the touchscreen telephone

that most of you are using today, invented the eSIM that most of you are using today. Invented the eSIM that most of you are using today. Also invented our quantum antenna and our proof of service. Good for you, man. Mario, you got to see these guys' balloons, man. Yeah, I covered, I covered. He's making fun of me

because I covered the Chinese balloon. No, I'm not even making fun of you. You actually have to see these guys' balloons. But can I go back, Mickey? Can I go back to my question in that? How does that all meet you? What are the meetings like that you had behind the scenes? What is the community like?

With all the news, with everything we see. The SEC action, man, with Coinbase, with Binance, with everything else that's happening, with all these different tokens considered securities. I think people forget, and they haven't realized yet. If you look at World Mobile right now and Zanzibar, we're in the top 15 of all blockchains in terms of real world users actually you people using the blockchain no bot no anything so i think the diehard world mobilers they know what's coming right they see what's coming they see nodes coming live they see new

countries coming live they see all the new licenses you know that's happening so our community is incredible and they're fully behind what we're doing. In terms of how do other people see this? Well, there's no other way for them to see it. We don't have crypto on the front layer. The blockchain, the mobile core that we've developed is the part that actually uses the token. And of course, the end user can hold that token,

gets benefits from holding that token, but absolutely not necessary if you put a token in the way of a user how do you get a billion people how do you get 100 million people these people might not know how to use it might not want to use it might be scared and you know the situation right now in crypto as it is always is uh fear instead is joy so in general in general man scott this guy this guy sc, this guy's too optimistic. He's joking, bro, joking. It's a compliment, man.

Any other questions they have, Scott Rant? I would just say give Mickey the chance for final thoughts. I mean, I know everything there is to know here because I've grilled him before. Mickey, anything else you want to share before we go? Look, too optimistic. When you've got something that real that has real world demands in the hundreds of millions or billions and billions there is a reason to be optimistic when you build your company in a way that is not um a typical crypto play yet involves crypto

mostly in the most meaningful way and you've got real world revenue driving through it's a great reason to be optimistic right we're seeing adaption every day the bear market is going down we may be losing token holders but we're gaining new customers every single day that are paying us for the network it's only a matter of time so you're right and the problem you're solving is i've always talked about this you know everyone's talking about all the next hot thing everyone's talking about ai everyone's talking about metaverse but then everyone forgets the true, the main reason, the main argument we made to support one of the biggest arguments we made for Bitcoin is

banking the unbanked or helping people outside first world countries. Remember, Scott, when we talked to these crypto skeptics and what we need to say, they're discussing with them that they might not see the utility of blockchain or decentralization, but they live in a different world to the people in Pakistan, to people in Africa.

And this is why Mickey's argument... Not just the people in Pakistan or Africa. Go to LA. Go there and see how much the cool drops. It's not just based in... It's a common misconception. And internet, that's the layer zero. Man, man, our space crashed yesterday.

No joke, because Scott's internet crashed yesterday. My house got struck by lightning in the middle of spaces. That's lucky. You did okay. I know. I'm here. You deserve some good things coming to you. I interrupted your final words. Go ahead, man. Final words are that everybody can be a part of this shared economy, and they should be a part of this shared economy. Everybody here is using the internet,

and it's a human right to have the internet. And that's kind of what we're fighting for. Ultimately, what we're looking to do is not run a charity here. We're looking to run an extremely profitable shared economy. And so far, it's looking pretty good. If you look at Zanzibar and stats on the WMT scan, we're the biggest DY by revenue that exists at the moment and we only have 390 notes publicly viewable we have a few more in a few different places we're just about to launch in

the United States of America we're also launching in other parts of Asia with some really big partnerships coming up and yeah please be a part of it you join you don't you know I'm not asking you to be an earth node operator I'm asking you to be an n-n joining. I'm not asking you to be an internet operator. I'm not asking you to be an internet operator. I'm not asking you to do anything except from be aware and make sure that people know. Without the internet, we're screwed. That's the reality. You have nothing. Scott, how do you know Mickey, by the way, Scott? I told you.

We met in Dubai. Bruce is here. Bruce, the host of the Satoshi Bounce Evil. We were there. We were there. Ran was there. I was sitting on the couch peacefully eating a meal and I met Mickey and we we talked endlessly I've known ranker even longer

rather than I met in 2019 in Miami I sat down and had dinner and I showed him and he was like wow you know we we need you know Africa needs this and that there were at that moment we were very focused on on the African continent but now the share economy is standing up on its own two feet is generating revenue you know it's the cookie cutter approach what we need to do now is massage that shared economy to work with life and spectrum in the united states of america much much different you know in some places you'll use wi-fi because it's fantastic massive throughput but the distance isn't so great so people will come to that node and that's very suitable for a village in Africa or Pakistan with 200, 300 people, three or four nodes there.

In other places like the USA, you stick it up on a big roof and reach 15 kilometers. And then we talked about the balloons. I wasn't joking. They're actually called aerostats. I get a fine every time I call it a balloon. But it's okay. I'm okay.

Sorry. I'm not sorry. But they're incredible, right? So we stick an air node on the bottom of one of these aerostats. Essentially, it's like a massive tower. It reaches, on the first version with our antenna, we've got 75 kilometers squared radius. That's a huge amount of distance that you can cover.

But you can't fit 2 million people, 3 million people, onto one multi-array onto this so you've got to have the ground station too so my final words are be a part of this understand that it's wrong that people don't have internet understand you can fix your own internet problems and your neighbors and the rest of the world and we have a right it shouldn't be controlled by one two three or four big companies around the world actually if you want to connect the unconnected, you've seen it. Starlink, Facebook, Google, almost unlimited money.

Have they succeeded? No. Why not? Because they're trying to do it alone. Together, we're unstoppable. Go ahead, Mario. Yeah, no, that's it, man. I think it was great.

I started my gym session while listening to this. But one of my favorite projects in a while. Really love the pitch, Mickey. Love the overview and love what you're building, man. And you're a great speaker as well. So the tweet is pinned above with more details. It's on my profile as well. So anyone that wants to check out World Mobile or hit up Nick, Mickey,

check the pinned tweet. Yeah, I'm doing my duty. Are you on a treadmill right now? Bro, I sent you the photo. I started my gym session. I woke up late today. I told you, duty. I'm so I mean like on a treadmill right now, bro. I said you the photo I started my gym session. I woke up late today. I told you man. I told you I'm consistent. I don't take a day off Yeah, I mean Leave one with you at home Cool Scott. I'll let you I'll let you wrap this paceman. No way. No

No, you're gonna have to wrap it from your bike bro okay i'm gonna wrap the space guys really appreciate y'all joining apologize for me doing the gym but i i promised myself to always be consistent no matter what and i did so i slept 14 and a half hours yesterday because of my i didn't sleep for two days and now scott's putting me on the spot but love you all thank you so much if there's breaking news we'll cover it on the weekend. Scott, you're an asshole. We'll cover it on the weekend and otherwise we'll see you Monday.

Mickey, you're a beast. Great pitch. You're a real example here, man. You're really dedicated. Man, I don't take a day off, man. I don't take a day off. I don't care. You're an asshole.

I didn't expect you to tell me to rap. I told you, so you take over. But no, guys, thank you so much. Really enjoyed this. It was a great space and at least I didn't expect you to tell me to wrap. I told you so you take over But now guys, thank you so much really enjoy. This is a great space and at least I didn't have quote-unquote thunder hitting my house We'll see you all. I was sending you guys your films off Then you're right. I mean, yeah, and and again the pin tweet is above check it out guys. Thank you so much I gotta go Scott. Thanks, bro. I'm ending it this just much i gotta go scott thanks bro i'm ending it this cheers okay i need to get my phone now to end it i'm gonna kill you i'm gonna kill you i'm gonna kill

you bye everyone bye