The Wolf Of All Streets - Bitcoin Pumping. Why? | Crypto Town Hall w/ @PepeCoins

Episode Date: July 19, 2024

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Good morning, everyone, except for CrowdStrike. I have no idea what's happening. I'm a boomer. Apparently, the internet broke. And that's CrowdStrike's fault. So no good morning to them. I came in a little underprepared. I read the title. I had no idea what it meant. It was like global IT crisis, crypto something.

So I just changed it to could blockchain help. But again, I'm not so technologically savvy that I have the answer to that. So I'm going to go to the panel and say that apparently, listen, I use Apple products. So I literally don't know what happened here beyond reading that airlines were affected, outages everywhere, people getting blue screens of death when they opened their computers, all really fun things that speak to the risks of centralization. So perhaps the title isn't about could blockchain help, but perhaps the title should be the importance of decentralization or something

to that effect, because I think we continue to see what happens when huge services that we depend on that are centralized fail, even if only temporarily. I mean, it's pretty crazy that I believe it was a CrowdStrike update, they were running, failed, only temporarily. I mean, it's pretty crazy that I believe it was a CrowdStrike update, they were running failed, and all of a sudden, you can't get on a plane. That seems problematic. So has anybody on the panel been paying more attention to this than me and kind of speak to it a bit? Go ahead and raise your hand. DBS, go ahead, Matthew, save me. Yeah, no, no problem. So this was a a crowd strike update that happened and it caused these blackouts like you said blue screen of death we've had a ton of airlines that have been impacted over 500 flights have been

canceled in the united states i think over 1500 worldwide have been canceled um it has impacted a number of different um i want to say, access points. So I think the New Jersey port is shut down. I think Houston is shut down. I think Los Angeles is shut down from what I heard earlier this morning. A big problematic issue in the UK because their health system is all entirely on one server that could be a single point of failure. And so that is down. And so there's a lot of operating rooms in various countries right now that aren't performing operations, everything has to be done on paper, because they need to keep records of what they are doing, but they can't do it digitally. So

just a huge, just kind of a huge cluster mess regarding, you know, travel logistics, and some payment processors are not working necessarily. but we've seen a lot of them come back up. So the Nasdaq, the Dow, these are trading certainly in the United States right now. And the market's kind of doing its thing. CrowdStrike came out and said that this was, you know, oops, sorry, our bad. There doesn't seem to be a attack or this doesn't seem to be a cyber attack. So that's one good thing. But there has been limited information with regards to what they've come out with. So I'll pause there. I'm certainly happy to answer any questions. A software update.

I mean, yeah, it's like a one and a zero problem, right? Like, I hope it's not a fat finger mistake or something like that. You would think that they would have a plan for a software update to go wrong you know like your phone dies when you're doing a software update and all of a sudden your phone is dead i mean it's apparently yeah apparently somebody said the solution was and i think i'm quoting this not confirmed but i'm quoting from what i heard earlier today just restart it at least 15 times and by then it'll sort of kick itself into the right gear so just turn it on and off a number of times and you should be fine do you think that they pulled the cartridge out and blew on it? I certainly would have tried,

you know, my, my Mario party would have, would have benefited from that or my, you know, I totally get that reference. Yeah. I hope so.

You can tell some of us, some of us have played Nintendo before. Carlo, go ahead. Good morning, Scott. There's never a dull moment. I was listening to Danish's show this morning where he was kind of breaking it down in real time. And they were talking about

number one, the insurance indemnification implications of this because a lot of companies have coverage in the event of these types of catastrophes? And will this be a massive claim disaster and lawsuits to follow? That's one interesting point about this. And then secondly, Simon came up and brought a good point, brought up a good point, because Danish was talking about how this is actually a very bullish thing for blockchain technologies. Simon agreed, but he clarified that probably the only blockchain technology that is tamper resistant to the degree of avoiding this type of a breakdown is Bitcoin because of its purely decentralized distributed blockchain network. To some degree, all of the other more centralized chains rely on these services as the engine to drive the

technology forward. So a breakdown in any step in that chain of technology can have devastating disruptive consequences. So this is a really good learning moment for everyone in the technology space because the downstream effects and the domino effects of this are widespread, and it's affecting markets across the board. So fascinating to watch this go down and feel bad for everyone who's impacted by it. It's absolutely wild, but it does sort of speak to the fact that decentralization is a scale, right? You can't be centralized or decentralized in most cases. I mean, we can argue that Bitcoin is decentralized in the manner that you just did, which I think is correct.

But we've also heard pretty eloquent arguments on how maybe Bitcoin mining isn't that decentralized. So I think everything still remains on a sliding scale, because even if you build the most decentralized protocol possible in crypto, if you're running on an Amazon web server, well, you get it, right? Go ahead. And even also just to add to that, your great point. Even if you have Bitcoin, and you're in the middle of this crisis, you still have to off ramp your Bitcoin to a more centralized system in order to cash out into fiat and be able to spend it. So you still have to off ramp your Bitcoin to a more centralized system in order to cash out into fiat and be able to spend it. So you still have that.

Carlo, you're never allowed to sell your Bitcoin. This is a crypto show, remember? Ever. That's- Ever. Okay. I'm going to catch hell. The grand council of Bitcoin wizards will shut us down for even implying that you can sell any. It's not possible. Okay. But let's say in theory,

you needed cash on an emergency basis. You still have so many complicated points of failure in all of this. It takes so long to off-ramp Bitcoin to a centralized exchange, convert it to fiat, send it to your bank. And then if your bank's website is down,

you know, we're still in a world where we still have a lot of hurdles to overcome. Dave? Yeah, I kind of want to bring this down to a bit of reality. You know, look, markets have seen events where single points of failure are exposed many times. And generally what happens is people freak out and they move towards, you know, they move to try to correct it. And sometimes because we have terrible regulators, we don't. A couple of examples, 9-11, obviously the human toll, there was a much bigger toll, but one of the things 9-11 showed was most of the firms on Wall Street believed they had multiple pathways, telecom pathways, to be able to access the exchanges in their software. Except it turned out that all of those telecoms went through a building, you know, that was,

you know, on Hudson Street, and that went down. So they learned that the networks were far from resilient. And so now we have significantly more resiliency in the system. We also know, because we've seen it many times, that there are single points of failure in the financial system and reporting to the tape and other sort of things that sometimes get fixed, sometimes don't. The point here is decentralization is a continuum, and there's always trade-offs involved. And while it is undeniable that incidents like this

will promote more open-source technology in general and blockchain in particular, and should, people need to understand that there are always these trade-offs and that markets tend to react fairly slowly and methodically and ultimately in the right direction. And so, yeah, I mean, the Bitcoin network is clearly the most resilient, but when was the last Ethereum outage, even considering multiple merges? And I've seen people talking about it before. All of that is irrelevant if one thinks that you need to have something like a CrowdStrike and what it actually does for cybersecurity in front of your network.

And that's what failed. And so it's sort of the same thing. You could have the most resilient network in the world, but if you put software in front of it for common cause, that becomes a single point of failure. You're going to have a problem. So there's a lot of work to be done. It's all very positive, but there's a lot of work to be done. It's scary that it can be this widespread for such a seemingly simple mistake, right?

I mean, I think that when you read the story, it's just, yeah, our software update failed and you can't get on your flight or you can't do surgery or you can't buy your only available in Japanese McDonald's, Ebby Burgers, because they shut down a thousand McDonald's. It's pretty crazy how the implications of this spread among the entire globe. So, I mean, I know nothing about CrowdStrike, particularly just the very basics. But Dave, can you go a bit more into what CrowdStrike specifically is doing, as you said, on the front end there? There are many people who will know it better than me. Unlike you, I only know the basics. Got it. If anybody does, great. If not, we're a crypto space, so

we don't need to know about CrowdStrike. But I think they provide protection against DDoS attacks for websites. They're like a critical piece of infrastructure. Right, but if they're providing protection, why would it not be crashing the systems themselves? I'm so ignorant on these things, guys. Don't you remember the Amazon outage because of CloudFlare? Of course, the CloudFlare. It's the same thing. Of course, the CloudFlare, yeah. Yeah, it's the same thing. I mean, if you basically put a gate in front of your

system, that will stop bad actors from pounding the crap out of your system, and the gate is frozen in the down and locked position, it's kind of like trying to get to, if your parking garage's gate is stuck in the down position, you can't get your car in and out of the garage.

It's not all that different i need to decentralize our parking lots does anybody else have any particular tape take on this or can speak to the fact that blockchain could actually help i mean i think in theory the title makes sense hey we're decentralized can we do this but like do we have decentralized competitors to these systems that are so centralized and essential being built at all jed hey guys yeah um this morning was pretty crazy i actually uh i sent a wire um pretty pretty late in the day yesterday. And then I get a message saying it hasn't landed yet at around like 9.30 a.m. today.

So I was super scared that this attack might have affected a wire. So it just reminds me of really the power of stables, stable coins so like we as a vc um would much rather i'm starting to starting to realize it's much rather than stable coins it almost feels like it's safer easier faster um and it's just like even just just like going through that experience today um just just really really reminded me of like why we're in this space. I just want to make that comment because it got scary for a moment there. Yes, simply the ability to send a quantity of money from one person to another.

Should be pretty simple, right? Not have 10 middlemen in the process. Was anybody else on stage impacted by this directly? I mean, did you get the blue screen of death or have a story like Jed where you had something fail? I mean, I would have been oblivious to it, if not for even reading the news. All right. Well, listen, we're not a bunch of IT experts. I think we should pivot here. I want to talk about the Ethereum spot ETFs again. We kind of unpacked this a bit yesterday, but we do should pivot here. I want to talk about the Ethereum spot ETFs again. We kind of unpacked this a bit yesterday, but we do have one here.

I don't think yesterday we literally spent an hour shitting on Grayscale for their dumbassness and 2.5% fees and trying to unpack whether they fell on their heads or were smoking crack. But it had to be one of the two. But perhaps we can talk to somebody who has a brain a bit wise one and you can tell us what you guys are looking at right now date of launch potentially and how you're approaching this at the moment yeah hey good morning everyone uh yeah it looks like uh we might be lining up to go next week. Can't confirm that. And it'll still depend on when the SEC actually gives the final green light. But things are looking good for next week or maybe the week after that.

And we're excited to launch into the market the investors that we've been talking about. Many of the people that we're talking about to allocate initially to the ETF are actually already, in many cases, investors in our Bitcoin fund. And it's conversations that we've been having to educate them on how to diversify their exposure and for them to understand the different opportunity that Bitcoin brings versus Ethereum. Many are being receptive to that and are now looking to not take away from their Bitcoin allocation, but increase the allocation in their portfolio to carve a sleeve for Ethereum. Speaking of the Bitcoin spot ETFs, we always unpack the inflows and outflows, but we've seen a very, very steady inflow trend in the past 10, 11, 12 days now. Again, right, since the market dropped.

And I know that we had over $400 million in one day earlier this week, had a three-day run over a billion. That trend has continued. So I've got to imagine there's still some optimism even in this sort of summer chop that the trend is still rolling, right, Juan? Yeah, what I actually was looking at yesterday was I looked at the Bitcoin bought by the ETFs from the launch on January 11th through the end of March, which was basically when Bitcoin hit all time highs. It was mid-March, but I just looked through the end of the month and through that period.

So those, you know, little under two full months, the ETFs bought 12 billion worth of Bitcoin and the network issued 3.9 billion in new Bitcoin. So the ETFs bought almost 4x the supply. Then from April through the end of June, the reverse happened. The inflows dried up a bit and you only saw $2.4 billion in inflows while the network issued $3.3 billion of Bitcoin. So it very well explains why the price stagnated through those through those months. Now, July, we're really seeing it pick up again. We're now at 2.1 billion for the month. That's already outpacing the Bitcoin issued. And I think

that's providing stability to the market. So we are seeing those flows start to pick up again. And I think it's very positive positive actually seeing quite a move on bitcoin uh in the past couple of hours i mean on this i'm looking at the four hour candle spread started roughly 64 000 and we just tapped almost 66 65 890 does anybody want their neck out and give us a guess as to why we might be seeing this move at the moment? Any theories? I look at it technically. It kind of was pretty clear in the chart. I've been posting those charts.

But, I mean, we're almost testing the highs from what day was it? The 6.0 day out went up around 66.1. Right now trading at 65.5. Is this politics related? Is this the narrative that we were talking about? Is it because a crowd strikes down, Bitcoin never gets down? Yeah, sorry. Not particularly fundamental only technical i say only technical but i also look at

it from uh both perspectives but at the moment very technical so we've been in a long term let's say long term quite a long time now and ascending parallel channel for the bitcoin price so we actually touched the bottom of that we got, regular bullish divergence at the bottom of the channel. That was when we were right down at the 54,000-ish level, 54.5 or something on Bitcoin. And we've risen beautifully using Elliott Wave as a framework. We've had a wave one up, wave two down. The wave three was precisely to the penny, 1.618 times wave one. We pulled back in a very nice little wave four.

And I think now we're just beginning that push up in wave five. And this will make up a larger wave one. So once we complete this push up now, we should get another bit of a pullback before we then get quite a strong impulsive move to the upside. So I'm bullish. Obviously, nothing moves in a straight line. We're going to get that bit of a pullback probably in the larger fractal wave too.

But it shouldn't take us much lower. And then we should be heading up towards all-time highs. So I think all the narratives round about the Ethereum ETF, whether it's on Tuesday, 23rd, we've also got the interest rate decision at the end of the month, which whilst they're not going to change rates i doubt um certainly there could be some intimation that they're softening their stance they're going to be a bit more dovish um likely i mean there's now 81 chance i understand of a rate uh reduction by september so um for the backdrop fundamentally it's looking reasonably

promising and technically it's looking great so i think you know when it touched the bottom of So, the backdrop fundamentally is looking reasonably promising. And technically, it's looking great. So, I think, you know, when it touched the bottom of this parallel channel was a great opportunity to DCA into Bitcoin and other cryptos because they're still highly correlated. And I think Ethereum is also a great opportunity coming up. So, that's my take on the market for the moment. Great. By the way, Danish, I'm trying to accept your request and get you up on stage, but it doesn't seem to be working. Try again. But go ahead, Fred and Dave. Yeah, I had a meeting with the SEC yesterday publicly in front of the Ninth Circuit. And I just wanted to anybody. Come on, bring it. Yeah, circuit and i just wanted to anybody come on bring it yeah i totally

forgot i wanted to free mask yeah it's uh you can watch the uh thing it's only about 30 minutes long i'll i'll post it but um everybody anybody who's listening who did watch that and sense of support i really appreciated it it was great you know um what we were doing was suing on whether my law firm, Hottel Law, could sue the SEC for an answer on whether Ethereum is a security or not. And so there's not going to be a decision for months from the panel, but the judges got a chance to ask me and the SEC questions. I'll just update everyone there, is that I brought up the SEC versus consensus case and the judges were hammering the SEC on that. And the lawyer basically said, now, you know, the, it's a little touch and go in the oral argument. So it's not something that you could say, oh, this is the

force of law or something that the SEC definitely is saying because they talk out of both sides of their mouth. But when they were asking, well, what's that all about? And the attorney was talking about, you know, rocket pool and stake ETH. The SEC essentially kind of stated that, hey, whenever you're pooling ETH, you're talking about a security here. So when ETH is a reward, it's, you know, a security here. So when ETH is a reward, it's a security. So I think in terms of staking for ETFs, that's definitely a factor. I mean, of course, you can stake ETH inside of an ETF because the ETF itself is a security. But the SEC is still holding on to at least that aspect of it. And when they tried to say that, well, we're not investigating ETH 2.0

anymore, the judge pushed them a little bit like, well, does that have any kind of implied, does that have any force of law? And the SEC was like, well, no, not really. And then the SEC attorney stated that, you know, really with Ethereum, however it's used is really how it depends on whether it's a security or not. There's all sorts of ways it could be used as a security. I say that just to show that SEC is still in SEC mode. We celebrate the wins that we got, but I still don't see them letting up anytime soon unless there's a change in the administration. And I think overall, in terms of my chance at winning that case and going back to the district court for CSCC, it was an uphill battle.

The slope and the pitch is still uphill. After I talked to those judges. We don't talk about slopes and pitches anymore. That's right. We don't talk about slopes and pitches anymore that's right we yeah we don't but i would say i still got a chance and it's better than lloyd christmas's chance with mary samsonite so you're saying there's a chance all that one well done get one past me you're not getting one past me not not a uh not a movie reference like that. By the way, I think when we specify the sec, it should be clear to people that,

um, it's not everyone at the sec. Hester purse literally gave an interview two days ago, I think to Zach Guzman, uh, and said that basically she implied that if Gensler's gone, when Gensler's gone, if there's a change that staking could very much be a part of the ETFs.

Yeah. I thought that that was really very much be a part of the ETFs again. Yeah, 100%. I thought that that was really interesting. And the bottom line is that there's still, I brought up to the court the Coinbase issue that's going on where Coinbase is in another vehicle trying to force the SEC to make rules. And the SEC continues to push the narrative that they can do whatever they want, whenever they want, whatever timeframe they want. And so, yeah, I mean, to your point, you get a change in and you can see, because there's no real basis for anything, you just get a political change and you can see actual radical substantive change.

Yeah. And I would say the Supreme Court might have a different take on that now after overturning Chevron deference as it is, it only takes one substantive buyer, just like it only takes one substantive seller to price. What we heard yesterday that we all went, oh, shit, about is actually a very big deal. And, you know, I had a so far, Ari Paul hasn't answered me. And I'm surprised by that. He expressed doubt and was willing to bet that there wouldn't be a US Bitcoin as a reserve. You're talking about Bitcoin on the balance. Yeah, and I basically came back at him with a very simple question. I said, well, as long as moving the 200 some odd thousand Bitcoin that the market has been afraid of that it would get sold, AKA Germany, into a, and i.e. don't sell it as a policy statement, is all you have to do.

Yep, that's it. That is massively bullish. And by the way, virtually 100% likely in a Trump administration. So at a bare minimum, we're now somewhere 60-70% of that 200,000 coins that people have pointed to as, oh, my God, I don't want to buy until they sell that overhang. That's gone. And that's extremely bullish. That has to be. It wouldn't take very much to convince somebody that maybe you want to buy a little bit here or accelerate ourself because other people catch on to it when he announces it next week. If the United States had to be going to the central central bank balance sheet every country in the world would do it there couldn't be anything bigger for me but what's important but the point that i'm making scott is this is easy you this is executive order this does not require anything because all they

have to do is just don't sell just transfer the stuff they already have. Now, of course, there's lots of conspiracy theories that they own more than that, but that's a different story. But even so, it's really simple to do. That's different than having it on the balance sheet, right? The government has those assets lying around. They can choose not to sell. That's different than something like backing the dollar or declaring it a strategic reserve asset. Well, a strategic reserve asset, a.k.a. like the strategic petroleum reserve, as opposed to telling the Fed to buy it.

The Fed's not going to buy it. That's a separate organization. It's certainly easy enough to do that. It's an executive order. It doesn't require Congress to go along with it. That's the important part. That's all I'm trying to say. They don't have to buy a single Bitcoin on the open market to achieve that goal.

That's the point. I have to say in context. So Dennis Porter obviously tweeted that yesterday, the tweet. And I'm not supposed to talk about it much. But the tweet basically said, huge breaking. I don't have it in front of me, but I remember. Huge breaking. I don't have it in front of me, but I remember. Huge breaking. Donald Trump to announce Bitcoin.

The United States adding Bitcoin as strategic reserve asset in Nashville, saying that's going to be at the conference. I happened to do an interview for The Street with the conference organizers right after that. And they were somewhat, let's say, disappointed that that news was being reported. Can I mention that just for one second? I don't want to talk about it. Maybe it'll happen, maybe it won't, whatever. Let's just take Dennis at his word that he heard this from some source who knew at the conference. Can you imagine the amount of work that it would have taken to get this written into the platform to get an announcement like this, the fundraising efforts, the, the drafting,

like the idea that Dennis thinks it is his place. If he, even if he had a credible source, even if this is all true, that it was his place to leak that on social media before it happens and put that in jeopardy in the name of getting engagement on Twitter, honestly is disgusting. I think it's true.

So, you know, and we will see whether it comes out in the conference, but your implication there, Zach, and I think that this is what was implied in my many conversations about it yesterday, is that maybe that was going to be the El Salvador adding Bitcoin to the balance sheet announcement of this Bitcoin conference. Yeah, I'm saying if it was. And the wind is out of the sails and could put the announcement even happening in jeopardy. Which I can confirm that there was a concern which just like what a bad trade for dennis porter to get some likes

you know i i asked him about it afterwards um and he kind of said listen they should be really happy because it'll put more asses in the seats uh but i think there's going to be plenty of asses in the seats i can tell you, and I won't get into them, but the rumors are pretty substantiated. First of all, Dennis, I don't think he was the first person who heard that or other things, but I can tell you that the rumors I'm hearing, which I will not share, if they are true, this conference is going to be even three to four times crazier

than you think it is with Trump keynoting. I mean, literally astounding, insane, unimaginable things. And I thought Trump was pretty unimaginable. But I guess, listen, instead of like litigating whether it was correct or not to discuss it, or to leak it in advance, and nobody's particularly happy about that on that end. Like Dave, I mean, you're kind of talking about how big this would be. Zach, obviously, there's the mechanics of it. But I sort of said before, I mean, if the United States decided like oil or gold or something that the Bitcoin was worthy of being a strategic asset, I mean, doesn't the world likely follow and it becomes the case for

every country? It would depend how seriously they take the announcement. There isn't that much Bitcoin out there. I mean, Scott, if we're talking about a move from 64 to 65.5, that is not even in the same zip code as being priced in. What I'm saying is what might very well be is people just saying, oh, wait a minute, that overhang of 200 some odd thousand coins is gone. That will be enough to probably take us back to all time highs. So what you're saying. Yeah. But an announcement like this is like Bitcoin to 600. The question is, the question is whether people take it seriously, right? Or whether this is taken as just a campaign.

That's great. Yeah. I'm talking about if it actually, to be clear, I'm in no way talking about what a politician, any politician, I don't care who they are, says in a stump speech to an active audience that wants to hear that exact thing that they're saying, because we know that that's what all politicians do. I'm saying if somehow Trump, you know, is elected, and this literally happens. That's the most bullish thing I can imagine and that is i think bitcoin right to half a million plus exactly right it's just not enough you know if every central bank somehow is forced to buy bitcoin to compete with the knights i don't think trump can can do it unilaterally like so there's matthew p smart guy, who's one of the fellows at Bitcoin Policy Institute, who did a preliminary analysis on what are the different avenues of law you could use. And the answer, you go even further down the road of difficulty to backing the US dollar with Bitcoin, things like that, I think those are really cool campaign type statements for multiple politicians, but just logistically, probably impossible. Right. I agree with that. I see James, by the way, Murphy, I think he just left. He was in

the audience. And I was going to say, since we were talking about politics, that James had created a super pact for John Deaton, literally just disappeared when I was going to try to bring him up. And you guys may have John Deaton running against Elizabeth Warren. James and I did a fundraiser for John in consensus. We were very happy with the results, but the fundraising effort as a whole was somewhat of a struggle, which we found very, very surprising with the animosity this industry obviously has for Elizabeth Warren with knowing that she's effectively the single person behind White House policy and Gary Gensler and the SEC's attack on the crypto industry.

We sort of assumed when John Deaton announced his candidacy that it was just going to be this wave of money coming in and support from the industry, and it just wasn't there. I mean, at the beginning, you know, he out raised her was the big headline in the first month or two, he did like 1.4 million, she had done 1.2, that it obviously came out that a million of it was his own, which is incredibly impressive that he put a million dollars behind himself in his own campaign. But now through the super PAC that James created, you guys may have seen the news yesterday, Cameron and Tyler each gave $500,000 in Bitcoin. So a million dollars collectively from them and Ripple Labs a few days ago also

gave a million dollars. So now he has to be crushing her, I would imagine, in immediate fundraising. And we all know that money is what determines elections. I think he has a real chance. Jed, you had your hand up. Go ahead. Sorry about that. Yeah, so I'm actually currently in Massachusetts. I lived here for about 12 years before moving to the sunny state of Florida. So I do have a little bit of like intel on kind of this race. You know, right now, there is actually a primary, a Republican primary where there are two crypto pro crypto candidates um one is one is named ian kane um he's a politician local politician out of quincy massachusetts which is like a relatively large city uh massachusetts and then we have john deaton and uh yeah things

were looking kind of tight on the fundraising uh front um but the the news with Cameron and Tyler giving a million dollars to this super PAC, I think, really, really kind of solidifies Jean-Denis as the candidate. That being said, though, realistically in the state, Elizabeth Warren, she's a brand. And crypto is not super important to a lot of the states. So obviously, if I could have my way, she'd be out of there. But I've actually been talking to Ian a bunch on his strategy. And I actually haven't met John Dean yet, but I've heard great things. But ultimately, I think it's going to be a slog, even with the fundraiser efforts. I hate to put a damper on

how things are going, but I just know the state. I know Elizabeth Warren just kind of loves it. He's always said it's a narrow path. Literally, his statement is, Fred, you were there with me when he gave the speech. Carlo, you as well. Three of us were uh were there in austin with him you know he says listen there's a narrow path to victory but it's a path to victory and he was saying that before he had two million extra dollars in his war chest and before elizabeth for him became progressively more you know unpopular and yeah she's a name brand in massachusetts but i mean blockbuster was one of the name biggest name brands in the. They're not doing too great, right?

I mean, brands die, and politicians get replaced, and it's her time, right? And so even if it's a narrow path, in my opinion, this race is as or more important than even the presidential race. So, I mean, she's a bigger problem probably than the white house uh because she's behind it and i just think the industry should be massively backing her and i guess the real story is they finally did right even if it's only uh ripple and the winklevoss brothers two million dollars in a senatorial race at a moment like this is really really impactful i mean car like i said fred carlo you guys were there i mean's got a chance. Mikkel, I'm bringing you up to it. You were there. Let's just get that frown and turn it upside down, get the momentum going. That path is getting wider by the day.

What would be even more hilarious is if we get a little bull run or a mini run sooner and that $500,000 in Bitcoin goes substantially up. What a great return on your political donations Michael yeah and just something about Elizabeth Warren too uh I'm from the Northeast part of the United States and while she's very popular in terms of people knowing her there's not a lot of people up here who actually like her. And as many of you know, the Northeast part of the United States tends to be a lot more liberal. But when it comes to support for Elizabeth Warren, from everyone I know, she's really at the bottom of the list for even that part of the political party. So while she's very popular and a lot of people know her, I wouldn't be surprised if she had a hard time getting a lot of support,

especially because it seems like recently with her attacks on the cryptocurrency industry and a lot of other things as well, to be honest, she's kind of turning more into a cringy grandma rather than someone who's getting a lot of support and a lot of grassroots movement. She's literally like one of four members of the anti-crypto army it's the worst army ever i mean it's it's embarrassing at this point and the the thing is you know i used to tweet constantly like i started the whole like fire gary gensler thing you know i'm on co and it was like every tweet i would relentlessly hashtag fire gary gensler and get upset with elizabeth warren

but at this point it's like i enjoy watching them lose so much that it's almost like I'd rather them not be fired. There's also no if they fire him, if we fire him, how could I watch the SEC take an L like every four days? There's also no voters in the anti-crypto army, which is so funny. Like I have yet to meet a single person who's voting this election on a politician being anti-crypto. Like there's absolutely no voters that it appeals to, and that's why you see the support from Democrats kind of falling off and kind of them turning to kind of vote against things like SAB 121 and stuff like that because there's no appeal to being anti-crypto.

You end up just shooting yourself in the foot, and even if you're neutral on crypto, even if you're neutral on crypto and even if you're neutral on crypto and you really don't care one way or the other, if you at least want votes and you want to be favorably politically, then you might as well just be pro crypto. So they're having a really hard time pulling people in that direction. And I think it's going to backfire big time. It's so dumb. Maybe they got Elizabeth Warren to consult on the Ethereum fees for Grayscale. The two dumbest things that I've seen this week. Go ahead, Dave.

Yeah, I mean, look, all if you're talking politics, it all has to be in context of what what we would call an unknown unknown, which is what's going to actually happen. Who's going to be the Democratic presidential candidate? How will it evolve? There's multiple things we don't know. One thing is absolutely certain, and this goes, it doesn't matter whether you're Republican or Democrat. You cannot, and anybody, and Elizabeth Horne is one of them, who are part of the octogenarian, well, she's septogenarian, whatever, but part of that old guard who have insisted that Biden is perfectly crisp, clear, everything is great. And oh, no, all of a sudden we just learned that he's not, you know, compus mentis since we want to push him out. I mean, that story is not going to fly.

You know, it doesn't matter how gullible the American people are. They're not that gullible. At the same time, a lot of the people who have been pushing for change at the Democratic ticket, people like Mark Cuban and others, have specifically targeted Gary Gensler and Elizabeth Warren as being part of the problem. And so, you know, Massachusetts is 60 percent independent. And, you know, it really depends. If you end up with a new, you know, who knows? I don't want to pick scenarios. But let's just say you end up with someone who's completely different than the betting markets you're talking about that emerges at the convention, and they are not a supporter of Elizabeth Warren, then, you know, who knows? If, on the other hand, it's a debacle, the down market effect of a debacle is a big deal. I mean,

it's five points, probably. So, you know, the difference in winning and losing could easily be who wins the presidency. And, you know, to actually talk about the election without understanding that is kind of silly, because we don't know. I mean, well, let's see where we are at the end of August. And then we probably have a much better idea of what's going on. Yeah, makes perfect sense. And for a very, very natural pivot, we're now going to talk to our special guest here at PepeCoin. We've got Drew. And listen, is it Fonzo or Fanzo?

Yeah, tell me. I answered either one, but Fanzo works. I mean, you could answer either one. But I mean, I guess if people called me Scoot, I could say, what's up? But like, I don't like it. It's dumb. So we're going to go with Fanzo. What's your name? First of all, is it, you know, because, you know, they always mock me as being a non-meme coin guy on this space. And Mario always is up here and ran just ripping me.

But you guys have been around since 2016, right? So yeah, and I'm a non-meme coin guy as well. So we're holders and community members. We run a kind of weekly Twitter space on the project. But this team, yeah, the original devs launched a Layer 1 token in 2016. So this isn't your average meme coin. They're building a Layer 1 ZKLLM focused on AI. So the meme coin is kind of the vehicle for delivering community and culture and ultimately

expanding while they've been building since 2016. And then they have the sister coin, which is the based AI coin that is out there now. So I'm with you. I'm a tech background. I worked a decade in cybersecurity for the Department of Defense here in DC. So I'm never been a meme coin guy more of a utility based what what can we do to actually move things forward. And in this project, in my opinion, it's extremely unique in the sense that it's not your average meme coin. The meme coin, of course, is part of the vehicle for cultural growth and community and its leverage within what they're building.

I love crypto. Only in crypto can I be talking to two frogs, one of whom says not into memes and works for like the Department of Defense in Washington. You can't, I mean, you can't write it better than this. You gotta love it. You gotta love it. You gotta love it. So listen, you obviously have a very serious job. You're a very serious frog. So what, well, why, you know, of all the things, have you sort of become such a passionate, you know, member of this community and what are you guys actually building? I've long since,

especially in this context of how meme coins have this meme coin explosion of the last sort of six months of 500,000 memes a month being created on Solana, etc. When we talk about it here, I say there has to be really a differentiation. There's meme coins that are doing it literally to not be securities and not have utility and it's hilarious in community. Then there's the ones that actually like either create a community and build something or have started with building something it sounds like you guys are definitely the latter being so early in all the things you're building so maybe you could talk about what differentiates and how it's not kind of a meme and what's being built

yeah scott i'll jump on in this one and uh it's great to meet you i just want to say whoever threw out the that lloyd christmas reference earlier that was a pretty good one and good job fred yeah dude it's so good it had me laughing over here but um yeah i think a couple other things and just so you know i'm kind of on the flip side of fanzo you know i'm definitely more so into meme coins uh the culture the communities um kind of researching and then trying to figure out you know from a marketability and awareness standpoint you know which ones have an upper hand and so that's that's more the world that i lived in uh a couple other things about pepe coin and i think you know scott i think from the from the get-go i think the our main goal today is like it's not to like have people go in and like ape the coin right away it's like i think it's it's

more so um you know are we providing enough context here and narrative for people to go and do their own research and i think that that's like that's ultimately uh our main goal here is there's so much that the token and the team has done over the last decade in crypto in addition to what they're building in the future that i think that that is uh that would be like our main call to action here is uh to go check out the website and i'll drop some stuff up on the top here in a little bit with some official links. But I think that that would be our main goal today is like go check out what they've built, how they did so, the culture, the fairness, and really just the overall intention of these devs that... Is it still the original devs Drew?

Yeah, so it's still the original and they continue to to build and hire out more robust robust teams when it comes to the ai side that they're currently building out but um yeah these are the original guys you know they they've been in crypto for longer than 10 years um all of them are early bitcoin guys devs and miners and um have continued to innovate and build crypto products along to be clear this isn't pepe like i i'm saying i'm getting like private messages. It's not Pepe. Right, right, right.

Yeah. So there's a distinction there. And, you know, I'll jump into some of the context. But, you know, the way that this really caught my attention is when you think about the top meme coins, both historically and where we see them today, obviously Doge is number one established around 2014. And then in second place, you have SHIB. And that was established 2020.

PepeCoin and these devs actually kind of have this strong sweet spot in between in 2016. So there's provenance and there's a lot of significance there to when they entered the ecosystem and decided to build. And where that distinction is a little bit tougher for people to wrap their heads around is these guys were the original you know pepe coin like coined term and meme coin in the space uh like fans have mentioned they were a layer one blockchain um through 2016 and some of the political unrest around the token and pepe the frog the actual meme itself uh kind of getting adopted by like a group of internet trolls that represented an alt-right group and and ultimately like this path of Pepe kind of being recognized and even by some governing bodies be recognized as a hate symbol.

This team was actually forced to change their name from Pepe to Mimetic. And when that change happened, they ended up getting listed to a bunch of exchanges and they continued to build their original plan. But it wasn't until 2023 when they decided to actually relaunch the token on Ethereum as ERC20, just for compatibility and EVM potential of what they wanted to build in the future. And it just happened to be, Scott, the same time as this other Pepe token, the one that most people recognize in the space as, I think it's currently like a top three, maybe meme coin in terms of market cap.

But that's where a lot of confusion comes from. There's a greater story to be told about why the actual launches are so close to each other. And people have their conspiracy theories and people have their ideas of what happened. But the PepeCoin team that we're here to talk about today, this is a team that's been building something for for more than 10 years and and this pepe coin project specifically closer to eight years um you know but there's a lot of blueprints and plans that were in the works and um yeah it just happened to be you know the non-intrinsic uh meme coin with with zero utility you know it just just happened to catch a lot of attention and um and the meme itself you know started to circulate and become a much greater theme in the greater crypto space. But yeah, that's the distinction there, Scott, between the two.

And hopefully gives you a little more context into the background of this team. Yeah. So obviously, there's things being built. I'm now just sent over a list. Keckbot, PepePay, KeckDAC, PepeOS, BasedAI. Got a lot of things happening here. Can you guys please break those down for us? What's being built and why it's important? Fan, do you want me to jump on this one?

Yeah, go for it. I'll jump in after. Yeah, I'll leave the more technical ones to you. I'll jump into what's happened recently. A couple of those products and Scott, you bring up a great point. They just built a myriad of crypto products that kind of serve two purposes in my head and the way that we kind of see this evolve over time. The first one is it's providing some type of massive value or significance to the crypto

space. It's bringing substance on chain that we don't typically see with other meme coins. And when we do see it, it seems more from like a surface level perspective, and maybe even just a quick liquidity event. With these guys, it's totally opposite. It's extremely intentional products that are one looking to help build community, it might bring connection between community members, it might bring certain utilities, like being able to monetize your creations. And so we'll start with PepePaint, which was recently released earlier this year in January. And one of the fascinating factors that we've seen take place over time is the amount of

PepePaints that were actually created. And so what it is, it's its own decentralized app on the website that you can actually go and recreate or create your own memes or artwork. And what we've seen is the community really, really take to it and create some incredible pieces. And yeah, when Fanzo's speaking, I'll try to throw a couple examples up there. But what it is, Scott, is it's essentially an ode to Matt Fury, the original creator of Pepe, the original creator and comic illustrator of Pepe the Frog,

where he first illustrated and created the meme on Microsoft Paint. And so this decentralized app that you see on the website is actually a, you know, like whatever you want to call it, it's a recreation, but it's called Pepe Paint.

And it allows you to create artwork similarly to how you would do so on Microsoft Paint. And then be able to actually seamlessly mint that product or project to a gallery that you can see on OpenSea. And so for the community members, it's been a huge outlet to create memes, to monetize artwork.

I know there's a few artists in there that they've sold tens of thousands of dollars worth of artwork in Ethereum and have used that Ethereum to then create bigger positions in the PepeCoin itself, right? So there's a lot of monetization that's happening. There's a lot of creative outlets. We kind of utilize it as one of our greatest marketing tools, as you know, as you see in

most other communities, creating memes, videos, content, things like that are a strong, you know, marketing point for us. So we kind of do all that, but organically, right? And so it's a tool that the devs have built for the community to leverage. So that's an awesome one. And we actually, we recently got recognized by Beeple. Beeple has a Pepe Fest, which is like an all-out Pepe event

that's happening in his warehouse, his art gallery warehouse down in Charleston, South Carolina. And, you know, he's recently not only given us a a shout out to just the overall community and the devs, but he actually made tickets available for free for people that hold PepeCoin. So it was a nice shout out. But also, he selected a few of our artists to actually recognize and showcase at the event itself. And so artists were able to really just have this global stage that they didn't have previous, you know. So if you're just an art creator, you're not able to

monetize and have a community to work with, but also we're getting recognition from, you know, I think people as well, like a top one or two top-selling artists in the crypto and NFT space overall. In the world? I mean, it's a $69 million NFT. I'd say that puts it

probably right up right now when we're talking about pepe pain i thought it was just gonna be like a paint set but everything's green like there's no other colors it's just a big green paint set just paint shades of green so maybe listen i know we don't have that much time left and so you know i had asked about base ai which says is your incoming mainnet launch and i also want to get some clarity on the brain burn that you guys mentioned before the call. So if you guys could break those down while we got a few more minutes.

Absolutely. Fanzo, I'll let you jump into the brain and based AI. Yeah. So I think one of the things to think about here with the different products, you know, I think when I said I'm not into memes, right? This isn't your average meme coin. And I think one of the things we have to think about in the crypto, especially crypto AI decentralized AI, is what are the entry

points into a community, into culture, into investing in a project like this, right? And so the idea that there's many vehicles to be able to be introduced to a project that is ultimately building a privacy smart contract focused layer one, you know, ZKLLM is a really unique way of doing this, right? That's why there's these different projects. And I would challenge anyone to go to a better Web3 website than what the PepeCoin team has built at PepeCoin.io. And so what is beautiful about that is this project has some dynamic tokenomics, right? So they launched a white paper a couple of months back, really focused on understanding that this isn't just, hey, we have a meme coin over here, and we happen to be launching

a layer one ZKLM over here. It's actually, they're very integrated. So actually, it's going to allow people that are holding Pepe coins to actually burn their Pepe coins for a subnet license, which is referred to as brains within the ecosystem, right? So right now, there are two tokens that are on Ethereum based AI, as well as Pepe coin. And so they've gone through two testnets. They are currently in testnet number two, right, which is the which is the final testnet, which will convert into the main net launch happening, you know, launch happening any day now.

And what's beautiful about that is there's only 1024 brains. So anybody that's familiar with BitTensor and what Tau has done, the idea of owning these subnets allows people to not only innovate, but also be able to monetize and be able to generate emissions off of this main net, zero knowledge main net. And we've heard there's lots of focus on FHE, which Vitalik has been talking about since 2020, on the importance of privacy and security. And so if I had to sum it up, this project is focused on... It has many layers within the based AI ecosystem as far as what they're building as far as the layer one. But the idea of owning our own prompts in AI is what this is moving towards. And so, the idea that there's not only smart contracts, but you can own your prompts. And let's face it,

everyone knows what we did in Web 2. Web 2, we gave up our data and our access and our control to information to the likes of Facebook and LinkedIn and Microsoft and all of the Apple. And so in Web3 and in AI, the question becomes, how do we start integrating and onboarding people to actually leverage AI in a world where we actually have data protection and data ownership? And that's what they're building with this layer one. And the beautiful thing about this is not only is it decentralized, but they're focused on a layer of privacy without compromising performance. And so for holders of PepeCoin, there will be a burn event that will allow them to burn their PepeCoin and then get one of these 1024 brains. And I definitely recommend people check out the

white papers on the Cornell website. And it goes through a dynamic tokenomics on not only how these brains are deployed and how people get them, but the idea of how much you can earn each, each time. And even right now, as we were speaking, as the test that is going on, you can actually stake your Pepe coin on the website on Pepe coin.io. And right now you're earning about five for every 500 Pepe coin you're staking, you're earning one base token, um, token on the in the farm now. And the beautiful thing about that is all of this lives within Pepe OS. So the Pepe OS is technically the tech stack or the the infrastructure, which is this Windows XP experience. I'm a I'm a pager wearing millennial. So I'm 43. And for me going in and living within this windows xp experience that they have on the website and being able to do all the staking it has a you know wind

wind amp on it it has a full experience that's not your traditional uh meme coin and as i said at the very beginning the reason i wasn't a meme coin person is i kind of truly believe and i was on rand show uh i've talked about on rand show a couple times about like, to me, you know, maybe it shouldn't even be called a meme, a meme coin, because there is such utility, and they're building something that is ultimately even bigger than web three with the privacy and the smart contract component. But I think the thing that we have to ask ourselves is, if we were building things that are truly decentralized, we have to have vehicles to onboard people in many different ways. And this project is really focused on that with having an art, having a trading bot, having the ability to onboard people through crypto Twitter, of course, through the meme,

but also onboarding people into the AI world. And they have some really interesting technology that I know that when I send it to my network of cybersecurity and enterprise tech people, one of the big things that I heard back was, holy shit, if they're able to have this work the way it says it's going to work, and they're actually able to have privacy in AI without having to massively compromise performance, this is going to transform how people are going to be able to use AI, such as healthcare, such as school systems, and small to-sized businesses that can't afford to launch their own privacy-layered large language model. So to me, that's why this is a much bigger picture than this.

And I just challenge people to check out the website, check out what they're building. This isn't your average meme coin. And I don't think it's competing with others. It's more of like, hey, what this team has built and already delivered and currently what they plan on launching with the mainnet is pretty dynamic. And I think it's going to transform a lot of the privacy conversations around decentralized AI. Wow. Definitely not a meme coin.

Maybe a project built around a meme. But I mean, that was a lot. That was a lot. So pretty impressive. So listen, but, uh, I mean, that was a lot, that was a lot. So, uh, pretty, pretty impressive. So listen, uh, we gotta go, but where, where should we direct people if they want to check this out further just really quickly? Yeah. I put a, I put a tweet up there, Scott, and it has a couple of different couple of different links.

So white paper and then official website and then, uh, yeah, the, the decks, but, uh, yeah, appreciate your time and letting us come up here and share. That a lot of fun uh your day yeah i mean fanzo definitely the first nicknamed frog working in like government uh i think i've met although there might be a lot of you out there is there like a whole army of uh government workers hiding his frogs on on x that we should know about? I mean, I think that's classified, right? Is one of you Elizabeth Warren?

I can tell you if I knew that, I would definitely expose that. I can make that promise. You're saying there's a chance. I'm going to end it on the dumb and dumber reference. They had to wrap it up in a bow there. It's perfect. All right, guys, we will see you on Monday, 10, 15 a Eastern standard time later. Thanks guys. That was great. Yep. Thanks Scott.