The Wolf Of All Streets - GALA DUMPING | Staked Hacked | FTX Sell-Off Happening! | Crypto Town Hall

Episode Date: September 4, 2023

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Yo, how are you, man? Happy Labor Day. Oh, shit, Evan Luther is joining us today. I just saw him on the invite list. Oh, it's about the gala discussion. What do you know about the gala topic? I mean, just I think superficially, we'll probably get into it later,

but basically that the two founders apparently are at odds and suing each other, and that means money is moving elsewhere, and you know me, man. I think that we won't be talking about any of this in a week and all these uh pumps that are happening will retrace and that's just the nature of the market where we're at but uh always interesting what pumps there's been money basically moving from gala or allegedly you know that's the rumor is that we're seeing like vulcan forge and a

bunch of other naka no idea what these are i know what vulcan forges and a bunch of other Naka. No idea what these are. I know what Vulcanforge is. And AKA. I know Vulcanforge. Yeah, of course I know Vulcanforge. But and others are kind of seeing this liquidity from people in gaming flowing out of Gala, which is going down and into all these other coins that are going up. But like I, you know, I tweeted kind of about this earlier, but I just in the pre-halving year, nothing lasts. These narratives don't last these pumps

don't last it's a great time to take advantage of them and take profit but it's you know these narratives move on in a week i mean remember us uh obsessing remember us obsessing over frentech uh two weeks ago cool yeah but no no no no no no no no no yeah exactly exactly exactly so the agenda is gonna i know the tvl's up, Scott, for the first time. Hooray. Have you guys ever seen bear market bounces? No, no, no. I want to actually challenge what you said because I just spoke about it for a while. But, Scott, don't you think that this feels very much like the end of 2019, the beginning of 2020? And I just want to remind you what happened back in those days just to give you a context so bitcoin went all the way down to three thousand dollars then we had a pump and bitcoin went to like fourteen thousand dollars

and then it started to go down again and went all the way back down to four thousand dollars and i just want to remind you what was happening at that time is that there were a whole lot of lawsuits. It was like the first time that we were getting big crypto lawsuits of founders fighting founders, investors fighting founders. It feels to me a lot like that time. Yeah, but your timing's off. But your timing is off. No, I'm not. 14,000 was the beginning of the summer of 2019. No. And everything didn't bottom until March of 2020. Correct.

I'm just saying, I'm not saying in terms of duration. I'm saying in terms of how it feels in crypto. It's like for people who never sold the 31,000, now we're getting this slow bleed down. Oh, man. It's the same as those people who held on all the way down to $3,100, caught the pump to $14,000, and then held on again all the way back down to $4,100, hating the fact that they never sold at $14,100. Yeah, I agree. But I think that implies that we're going much lower because $14,000 in June of 2019 effectively would be the equivalent of 31,000 in June of this year in the cycle.

I'm not saying that's my opinion on what's going to happen. I'm just saying if we're comparing apples to apples, I think we're saying the same thing because I'm saying that right now at this part of the cycle is when these narratives don't last. We go down, we go down, we go down, and then we get to that sort of final capitulation that I think Ben Cowan's been talking about this whole time yet again not this is just analysis right it's not necessarily but the last but the last capitulation that was triggered by by black swan events by covid like it's the same in every site it's been the same in every cycle regardless of that narrative or not if you look back at the pre other pre-having cycles you get like kind of one more uh higher

low generally and listen uh higher low generally and listen that higher low could be 25 but i'm not saying that that means we're necessarily going lower i agree with ran this is doom sentiment right now but that was my point is like this gaming thing i'm not i think gaming will be a huge narrative of the next cycle but i don't think what's happening today in the market like where things are flowing is going to last. Just like all these other, we've had these mini rallies in different little areas. Look at Unibot. I mean, like a month ago, the Telegram trading bots were the future of crypto. And I was like, nah, this shit will be done in a month. Like, I don't care. And I'm not saying it won't be the future. I'm just saying that you can't, in my opinion, depend on these mini pumps and price action right now, because this is just the downside of the cycle. Look at

Google searches, look at price, look at volume, look at volatility. This is the lowest volatility year so far in crypto we've had ever. And that includes a move basically in January all the way up from 15 to 31. I mean, we're setting records for how boring this is, which is not a bad thing. I think that that speaks to a lot of potential for the future. But I just don't think you're going to get something meaningful where the liquidity actually stays and the hype lasts until we get a true bull run out of Bitcoin. Let me read out the news very quickly, just a quick update. I think there was a quick recap of the news over the weekend. So we got majors. I'll do what Scott very quickly just a quick update i think those quick recap of the news over the weekend so we got majors i'll do what scott usually does a quick market update

majors flat very little volatility in top 50 coins there's nothing there and we'll get scott to dig into it a bit deeper tell us how flat it really is and we've got jp morgan that's probably the most exciting is jp morgan said that the bitcoin etf will now be approved or most likely be approved so it's coming directly from JP Morgan. So for me, that's pretty bullish. Google searches for crypto hit a five-year low. I'm not sure. So that, hold on, five years. So we're back to, what are we now? So 2018 levels. So what? The beginning of the bear market. Yeah. Can I say something really quickly about that though? I hate to interrupt the news update, but I think the Google search thing, it's a good metric,

but a bit misleading because every cycle, more people know about it naturally. I mean, it's on the mainstream news, it's on CNBC, it's on Fox Business. So there's less people that are going to need to Google it in each cycle because they understand it. Yeah. And I think you'd want to look at how much people Google DeFi, how much they Google NFTs, how much they Google Ethereum, not just crypto. So I think people are more educated now, so they'll have more Google search results. But still, you know, crypto could be included in sentences, et cetera, crypto exchanges, top crypto exchanges, best crypto projects. And to be at a five-year low is not a great thing. It's not a perfect indicator, but it's an indicator nonetheless.

Grayscale has been identified as the second largest ETH owner. So Binance News, we've got two pieces of news. So CZ says that Binance is way ahead of the game when it comes to US regulation. But at the same time, we've got the head of product at Binance who left. Huobi is doing well. They're the second highest spot market share. They got the second highest spot market share after Binance. Another bad indicator just shows how bearish we are. And then I'll talk about the fear and greed index at the end. But DEX volume is the lowest it's been since August 2020. Yeah, that's three years.

So the lowest it's been in three years. Could head lower then. Sole co-founder wants FTX sold, redistributed to customers. So we'll talk about FTX liquidations. That's probably one thing we don't, yeah, it's in the heading. So we're going to talk about FTX, the potential liquidation that's incoming. And the sole co-founder is asking,

I don't know if it's a reasonable, I don't know, Joe, you can tell us if it's a reasonable ask to actually distribute that sold to owners rather than to customers, rather than liquidating also. It's impossible. It's impossible. Because remember,

Solana is not owned by the people that had Solana in there. Not every FTX owner had Solana in their accounts. That Solana was the fact that FTX or Alameda invested in Solana or bought OTC Solana or invested very early in Solana and they got a whole lot of tokens. Now, imagine that you were an FTX creditor and they said,

well, imagine you hate Solana or you never even, on your agenda, you never even thought of buying Solana and now all of a sudden you get like a distribution of like $1,000

in Sol tokens. You're like, what the hell? I didn't ask for Solana tokens. I don't want to be sad. No, but hold on. But Ryan, I might have misunderstood it.

I thought they wanted to distribute the Solana that was owed to customer funds. So any customer that had Solana on FTX wanted to distribute those. But paying – I mean, that tweet that you're talking about comes from Anatoly. Now, all respect to Anatoly. He's a great guy and he's a great founder. But I don't think he's quite understanding of how this process works in law. And if he needs any guidance of how this process works in law, he if he needs any guidance of how this process works in law,

he must just go and look at how Mt. Gox worked, where first the liquidator has to go, the bank, you know, go through the whole bankruptcy process and collect all the assets. And then maybe in a long, long time, they'll take all the assets and either distribute it like Mt. Gox is distributing Bitcoin

or distribute money from the collection. But either way, I can guarantee you, I mean, it's such a, I read it and I covered it on my show, but it's such a ludicrous thing to do. Say, hey, just pay all the Solana holders out in kind. It's just so ludicrous. It's just, it shows, look, Anatoli is probably one of the smartest minds in the world when it comes to telecoms and to blockchain and Solana. But I just think in this case, he tweeted at Adam Cochran.

He said, if you've got any ties to the liquidator, first of all, Adam Cochran has zero ties to the fucking liquidator. And second of all, even if he did, there's no way that they'd pay Solana out in kind. I mean, just pay what? All of a sudden, you get a distribution. Hey, you got an FTX gun. Hey, can we please send you 30 Solana please send us your sole address i mean just think about how ludicrous that sounds well i mean this is not sorry as you say this is not so uncharacteristic

of the chapter 11 process i would say the fdx is actually well ahead because they have at least galaxy helping with the liquidation i mean listen i'm, I'm a Voyager creditor, so I've been through this. But I mean, Voyager literally took to effectively trading to try to pay people back and sold the deadest bottom of Bitcoin right before a major pump, sold the deadest bottom of every single altcoin against Bitcoin after that happened and basically liquidated it totally the wrong times, and then still offered back most of the larger crypto, Bitcoin, Ethereum, et cetera, in kind, which I actually took and was up on in kind on the very pittance that they gave back. But I mean, this is less an indictment of what's happening with FTX or Solana than it is just a shitty chapter 11 process. But I would say that at least you have Galaxy behind this

liquidation who has some knowledge of what the hell is going on. How much did you get back, by the way, Scott, from Voyager? What ratio? They called it 35.6% or something like that, right? 35.6% of your balance. But remember that it was your balance based on the depth of the bear market last July. So you're talking about your balance based on when Bitcoin was 19 or 20,000 and when Ethereum was, I don't know, 11, 1200, something like that. So the day that they actually liquidated, if you look at what your average, your bet person's balance would have been, because I was primarily holding Bitcoin and Ethereum, it was actually about 24% of what, if I actually still had those coins. So it's pretty

bad. I mean, you're talking about less than a quarter of your money. And even worse, obviously, when you think about that is the fact that the only reason it was a quarter of the money and not 75% of the money is because of Chapter 11, right? If they had liquidated on the day that instead of declaring bankruptcy, we would have gotten 70, 72% of our assets. They had the $600 or $700 million hole. And then in that process, they did a failed deal with FTX, which, by the way, is probably a good thing because we would have become Voyager and FTX creditors. And then did the failed deal with Binance US, each of those costing hundreds of million dollars to creditors on top of what was happening with the thing. And then finally, after two failed deals, did that pit. I'll just wrap up with the last piece of news. Now, we'll go to Eric just for a quick market

update. So I'll talk about the fear and greed index is at 40 out of 100. So we're in fee territory. Again, we were neutral last time we did a space. I think it was Friday. Lastly, the Frentech TVL is starting to rise again. So I think that's a really good indicator in my opinion. Like we're in a bear market. You've got Front Tech. So when something is a hype, when something just gets pumped and with no substance behind it, when it dies, it dies. It never revives again, generally speaking. And if Front Tech's TVL is rising again, for me, that's a really good indicator.

I was surprised. I haven't looked into it. I'm going to start looking into it now. I've seen some of the updates on the X page. I don't own much of – I don't have any shares in frantic or any anything i'm not even active on they haven't been active for like two weeks should probably get active again um but that's a really interesting indicator hopefully soon we'll get another another frantic space going i'll try to convince ran and scott especially scott um but before i'm

open to it but don't you think nothing goes straight down? I mean, like a little bounce in TV. I don't know. I don't know, but how big is it? We've got to give it time, though. I don't know, but that's like everyone's guilty of this. Bitcoin was 69,000. 59,000, guys, we've got to bounce.

52,000, we've got to bounce. 42,000. When something collapses, you're gone, man. I think we need to be fair here like i'm i wasn't i'm not a big fan of it because i explained to you the the fall the the shortfall in the model but they are they are making some some moves they made a move today they're starting to accept credit cards for uh for for playing the game or playing the game for participating in the network like that's quite a cool move you know like if this team can innovate and and improve their product over time they may be onto something you know and i said that's a big but man before you could do that's a big move the credit card one it's a really big

move that's what will bring in the retail audience that's what will bring in more users it shows that that they're thinking now listen i would have i would write off friends tech completely and i'd say this is just another garbage social network. But the reason why I'm not is very simply because, as I said before, the reason I don't like social fire in crypto is because I think you cannot penetrate the network effects that all the big networks have, Facebook, Instagram, Twitter, Snapchat, TikTok. But these guys are actually leveraging off the network effects of the existing social network and not trying to start their own social network. And that's why I wouldn't write these guys off. I wouldn't write these guys off. They've got a slight chance of success.

Let's put it that way. And if they start doing that, put a card and stuff like that. I absolutely give them that. Sure. Why not? Yeah, exactly. If they were competing with the other social media platforms, we're going to move on, guys, to the topics at hand. But we are talking about competing with Facebook, competing with Twitter, which is what BitClout was.

And BitClout is probably the clearest example of what these guys are doing. If they were competing against those, then their likelihood of succeeding would be a lot less. And I'd be a lot more bearish. But for them to be like, hey, you can buy and sell tokens and people. This is what we do. We're not a social media platform. For me, that's a really interesting selling point. It makes sense. But let's dig into the topics at hand. Eric, maybe give us a quick market update, your thoughts on, I know we dug deep on the weekend. Anything else to add markets over the weekend and then we could dig into the FTX sell-off? No, we want to talk about the quad witching

quad yeah we can i saw that eric i saw i saw that quad witching on the agenda i thought the team did a typo so i'm like i'm not gonna embarrass myself and mention it but obviously it's not a typo so eric can go ahead no indeed it is the uh quad witching is upon us actually so um you know i think uh what you guys kind of brought me on here to talk about was basically most people know that September is generally a down month, right? For pretty much all markets, Bitcoin included, of course, as well. And that is I found something that was very, very interesting that I think is maybe worth knowing, which is for about the first half of September, yeah, that is when the most downside typically does happen. In fact, for Bitcoin, my current model is actually suggesting if there is going to be downside within this next 10 days

is basically when that would be expected. But on the third Friday of every September, we have something called quad witching, which quad witching, if you're not familiar with the term, is basically a major expiration for options for both indices and just regular stock options. And then the same thing for futures, for the indices and just regular futures. And this is a really, really, really, really, really big deal. It only happens four times a year. And the reason why it's a big deal is because all of the big money managers, you know, the big hedge funds, the big quant firms, these sort of things, they typically will, you know,

have major expirations coming up on that date, meaning that they either need to roll their positions over to the next major, you know, quarterly contracts or change things up. You know, this is where they typically make big decisions big money managers people who actually move the fucking markets not you know not the retailers or not anyone else really um anyway so when i dug into the data and i looked at that specific date to the end of september i found something that was completely different than what i think most people are talking about with regards to September. And it is this for Bitcoin specifically, because I believe that this chat is primarily focused on Bitcoin.

Only two, only two of the 13 Septembers in the full history of Bitcoin have posted negative gains from that quad witching date to the end of the month. Of those two, one of them was just negative spot 70 the other one was about negative three and a half percent everything else was positive or neutral basically um for about an average return sorry my girlfriend's playing uh zelda in the background and it's very uh it's very exciting is it like the original the original or the kingdom screams like crazy it's insane uh the neighbors think something's going on here. But it's Finland, so no one talks. Anyways, yeah, so the average return for those winning months was about just over five and a quarter percent.

So that is why the 15th in this particular instance is the most important one. It's the third Friday for September. friday for september and uh and like i do say you know short term over these next 10 days not only is that data you know more on the uh more lean towards the downside so is my own uh personal model for bitcoin right now which does say you know if we are going to see an actual like an actual move to the downside like an actual crash if you will uh it very likely happens within this next 10 day spread but once the 15th, I'm going to majorly change my turnaround at least for some sideways, most likely. And then we can play the same game

in October as well, of course. But, you know, I think that's kind of the majority of what I wanted to say. And hopefully that was in some way valuable. Scott? Yeah, I mean, I think that's actually really interesting insight because we have this notion

that September is such a bad month. But if you actually drill in, you know, to what Eric's talking about, you sort of have this have this bad initial two weeks. And I think we also know that as bad as September is, people have the same notion, which may or may not be overblown about October and that things start to get going in the next quarter. And I think to add to what Eric said, something that we often talk about is, you know, it's window dressing season for the big, big money managers. If you're coming out of a boring summer, you've got profit this year. It's been an epic year. And this, you know, applies to all markets. You're going to take some profit, pad your books, make sure that you're going to get your bonus at the end of the year. Wait, wait, wait, wait, wait, wait. So for crypto, September is generally a bad month. For traditional stock markets, wait, wait, wait, wait. So for crypto, September is generally a bad month. For traditional stock markets, actually, September is actually a bad month. However, I covered a tweet earlier on the show. In that tweet, it says, in years like this, where the NASDAQ is up more than 15% in the

first seven months of the year, and I think down in August, which I think how it was, the rest of the year is actually very, very bullish. I think with an average of 11.7% return in the stock markets for the rest of the year. So- Then you have to win the clause rally. But that, yeah, this is exactly what generally big money managers do, kind of to Eric's point, is you take some profit after the summer, things are way up, you kind of have a slow whatever, and then you rally into the next year and especially obviously coming into an election year well no september september is also september is also green september is green september is green uh october is green november is green and december

is green with an average of 11.7 percent now that's every month it's not necessarily for a crypto uh in traditional markets i made a statement last week uh that really rubbed some people the wrong way period but uh but i do believe it or at least it's not that i believe it it's just it's it's what the statistics are which is the only thing i care about and uh you know based off of you know what's happened um this year in august i do believe that traditional markets have very likely already seen the low for the year and if history is anything to go by the last 20 years, we can expect or it would be statistically relevant to be looking for new all time highs in traditional markets. It might not be anything crazy. It might be like 2007, you know, where it's slightly new highs and then dumped to hell.

But but ultimately, that is what that sort of particular setup had. Eric, it's funny because, listen, we all know that if you zoom out far enough, markets just go up anyways. So on an average of all time, I would imagine almost every month is probably green for traditional markets, correct? I don't know. Eight out of 10 months for the last, I think, 30 years are green. Yeah. Yeah. So it's hard in traditional markets, unless you're zooming in, obviously, on the sort of brief, bearish times. I mean, I think on any 10-year period, even in the stock market, regardless of how bad it's been, including the Great Depression, you end up with a 7% yearly.

Guys, can I ask a question? And usually the down months, Scott, usually the down months, just very briefly, the down months tend to be elevator down. So they're more painful, like they're more remembered. Of course. But most of the time, it's just a stair step up per month. Yeah, I would imagine that it went over all time every month if you average out 100 years of markets, that they're all green. Yeah, so I know we're going to discuss the Gala topic in a bit as well and the meta there. But before that, I've got a curveball question.

A while ago, we were discussing Binance and all the fight around Binance during the FTX days. And everyone was saying, like, if Binance falls, we're all fucked. Crypto's dead. At least that's what I was being told when I was hosting the FTX spaces. Yet we're seeing a lot of news on Binance in recent months, and we still, you know, the potential DOJ investigation. If Binance does fall, which I

don't think it will, and I'm pretty bullish, I think Rand as well, I'm not sure with Scott, I think Scott, you're on the same boat as us, but if Binance does fall, and, you know, that question got triggered when I saw Andrew on stage and Mike in the audience, because I know they're both very critical of Binance. Are we past the stage? Have we matured to a stage where the big guys will just cover for them?

And Coinbase is doing pretty well. They're fighting the SEC. They had a couple of wins recently, indirect wins. And then we have that new exchange launched by Fidelity, whoever it is. Does that mean that if Binance does fall, it's no longer that big of a deal as it was a year ago scott andrews kind of a question goes to you guys and ran because i don't know i think it's still a very big deal but it increasingly lasts with time but go ahead andrew all right i i think that it's a relevant question still it will be the question will be what will the fallout be and what will the charges be you know is it a

is it a day event is this a multi-day event is it a you know is it is it a full month what kind of lifespan does it have and what does the quote-unquote fall of binance even mean right if there are doj charges right that's States focused. Are there other countries that are involved? You know, here's the reality about Binance right now. There are different tiers and levels of them backing away from or being removed from different countries. Right. That's been happening for a period of time. So in my mind, as I look at it right now, I think that there's a bit of Binance being muted by law enforcement, whatever that means. I think it's pretty priced in at this point. I think that there may be an initial reaction if action is completely over the top. But at the same time, there have been organizations, other exchanges, other parts of quote unquote crypto architecture, which have moved into the spaces that Binance is still in. For example, Coinbase now has an international exchange that they've stood up and that architecture exists. Gemini But at the same time, there's probably a large portion of volume that will spread itself out to other exchanges. For example, you know,

we were all around when this happened to quote unquote BitMEX, right? BitMEX got hit hard. Their executives were quote unquote on the run and BitMEX volume crashed. Right. Well, at the same time, that particular story lasted, I don't know, a week, three weeks tops. The the exchange volume associated with BitMEX fanned out, to be fair. But there was no there was no spot. I think you're correct, by the way, in the general assessment. But they did not dominate the spot market remotely like Binance does.

That was just a leverage. They created the perpetual spot. I want to add something here. That Binance's dominance of spot, again, has been decreasing a bit over the past six months. Yeah, going to decentralize exchanges, for sure.

Yeah, exactly. So I think this is the best thing, guys. Andrew, I think you fit onto something here, which I've been meaning to talk about for a while. I just haven't found the right platform. But I think that the pace at which this Bin this finance thing playing out is the best thing that that could possibly happen for the industry even better than nothing happening to binance so if you would have asked me would i prefer for nothing to happen to binance or would i prefer for things to be playing out as they're playing out now i would prefer for things to be playing out as they're playing out now and the reason is so trueance was too big. They were too centralized. As much as I love Binance as an exchange, as much as I use Binance, as much as I respect CZ, etc.

They were too big. And we need it. It's a very unhealthy market. Now, what you said is exactly right now. People are starting to fill in the gaps and people are migrating to other exchanges. So, for example, I actually looked at the spot volume. But the spot volume is starting to move very much towards Coinbase, starting to move very much

towards Bybit, and a whole lot of other exchanges which weren't big players before. And like you say, that's happening with a lot of the other Binance things. And so the pace at which this is happening

is probably the best thing that could have happened to the market. And if we can delay this action, I don't know if maybe I'm being delusional, but if this can go on for another year,

then I think when it actually does happen, it's going to land up like the BitMEX moment where it's like, okay, well, we've all been expecting it. Great.

Thanks very much. Let's just move on. No, but doesn't it? Yeah, Ryan. Hold on, Ryan. I agree 100%. I don't think it even needs to be delayed.

I think it's already, as Andrew mentioned, it's already been priced in. And as long as Binance doesn't follow the footsteps of FTX, which I think we can all agree that's not going to be the case, that ship has already sailed. As long as that doesn't happen, what's happening to Binance right now, even if the DOJ

we start seeing some things get public there, I think it's already past the stage that will have a massive impact on the markets. It depends already price it depends what action is depends what happens if they freeze customer funds it's gonna be a big problem if they if they if they confiscate funds if they freeze accounts that's gonna be a big problem but if it's just some kind of action I think it's all being priced in okay really quickly guys we have actually a bit of breaking news

obviously we saw this morning that there was allegedly that Stake was hacked. It seems Stake, the gambling platform, has suspended deposits and withdrawals. That's the biggest. Hold on, guys. Isn't that the biggest gambling platform? Are they bigger than Rollbit? I don't know, but I mean. I think they are.

Does anyone know? Anyone on Stake? They are definitely bigger than Rollbit, for sure. Stake has significantly more volume yeah there you go again do you know much do you know much more about the hack evan you're pretty pretty ahead of these things shout out no i don't actually gamble the big boy is the steak guy yeah i don't actually gamble so i'm not really using the platform but i didn't i didn't know much about but i do know i don't do a deal with these guys I do know that they're much bigger than all but okay that's pretty major news yeah as an aside I told my team when and I said it facetiously and I said it as a joke I said when bitcoin took off on the stake sponsorship I said that's the

end of stake and now just after all the fun that's happened now and to hear this is like oh man I hope we wish that the hack is not too bad and obviously you know a hack is different than a platform collapsing they've been hacked so it's unfortunate and I hope that all goes well there and as we get more updates there you know the team is sending it in our news group so we'll mention it here on the space also I want to talk about Gala

guys I want to move away from buying that something it was good to touch on it but Scott maybe you give us what you know about Gala, and then I would love to go to Evan because I know he's deep in the Web3. Evan is the guy. I think actually Evan should just go ahead and do it because I'm not that well-versed, and he had the great thread.

Evan, what's the story with Gala? It's basically the two founders are doing each other. One guy is claiming the other guy embezzled funds from the company, used the funds for personal reasons. The other guy is claiming one guy sold tokens, OTC, worth hundreds of millions of dollars. And

we don't really know what's the reality. I think it's going to play out in the code. There's going to be a discovery of facts. But at the moment, one founder is suing the other founder. Both are suing each other. So that's really what the situation is. And I guess that's... Yeah, but why does it matter?

How does it impact Gala? And then Scott said that some investors, some people are selling Gala and going to other Web3 games. Is that true? Yeah, I mean, obviously, Gala's chart has taken a significant hit since this news came out.

I mean, one of the founders is claiming that the other founder is taking funds out of the company, company funds for personal reasons, that already would make you lose faith in the company doing well long term. And then the other founder is claiming that the founder is selling tokens OTC at a discounted price and for not just a small amount, for significant big amounts. So I think that definitely long term would negatively impact the token value.

So it's not a surprise that people are getting out of Gala and going into other Web3 gaming tokens. So I think the point here is that now we're starting to see that actually, hold on, this thing of a decentralized blockchain is actually not so centralized. And actually, you know, the central point to Gala is actually these founders. And now the founders are starting to fight amongst each other.

Now, in a centralized corporation, if the founders are starting to fight amongst each other, that's probably a amazing idea, built something amazing, and also started to spend a lot of money like crazy, buying private jets, cashing out $135 million. These are just allegations in the court papers. And now when the market's coming down and the pressure is starting to be felt, then there's all this fighting. There's all this fighting amongst them. And it's the cleanup. It's the cleanup. We're cleaning up what was supposed to be decentralized. We're now realizing, hold on a second,

this is actually just a centralized company for all intents and purposes. Yeah, but we knew that. Like we knew, and by the way, going back to the Binance discussion, what's cool is that during the bull market, and Jason, I'm going to go to you right after because I saw you on mute when we discussed Gala.

But going back to the Binance discussion, one of the people who are critical about crypto, we're talking about crypto is not decentralized. And Binance is one of the examples on why crypto is not decentralized. And that was even a bigger concern when FTX collapsed because Binance has got more centralized. So now that we're seeing regulatory action against Binance, whether you agree with it or not, we are seeing, as Ran said, funds move to DEXs. And DEXs, I think they performed pretty well over the last few months. And then linking that same argument to Gala,

obviously we're seeing the shortfalls of decentralization and the illusion of decentralization in many cases. But Jason, we'd love a bit more data. How impactful it is to the Web3 ecosystem, the Web3 gaming ecosystem, which I'm extremely and vocally bullish on. Sure. So the first thing is, and I've got to say this, and it's not going to be a surprise to anybody,

is that I can't actually comment on either of the cases in any way, shape, or form. What I would encourage everyone to do is actually go read the documents because they're quite interesting and there's a lot of information there. One of the things that I really want to stress is that this is something that is very much between the founders, and it doesn't really have a whole heck of a lot to do with the company itself. We're still operating. We're still moving forward. We're still building stuff.

Not to say that it is – I mean, obviously, I'm here and I have to talk about it, so it is definitely a thing that we do have to deal with to a certain extent but mostly in the sense that it's uh something that other people are extremely concerned about and uh you know is generating a lot of conversation but i actually welcome it because i think it's going to in the end result in some pretty positive things for the ecosystem as a whole and what what are the what are those positive things jason well i mean i think that any time that you have uh light shining on a situation to allow people to really dig more deeply into whatever is going on i think that that's generally speaking a positive thing um you know i'm those of you guys who who know me or who have been following me in the space know that i am a pretty big believer in decentralization and in the ethos that surrounds

all of that. And, you know, companies exist, companies do company things. And when you, you know, there are certain elements of centralization that exist in all of these sorts of things. Not a huge fan of all of that necessarily. But I think that overall, if this leads to a greater decentralization of what's happening, then that's good for the gamers, for those who are owning in-game assets, and for the company as a whole. And how is that impacting the Web3 gaming ecosystem as well? I'm curious, how is that impacting other projects?

To be honest, man, there really isn't a lot of other projects out there that are legitimately gaming projects. There's a few. I don't want to, you know, I'm not trying to cast aspersions, but, um, I think that the biggest challenge that web three gaming has right now is that it thinks of itself as web three gaming. And that's kind of the biggest issue. You know, one of the things that differentiates us is the, the games that we put out and the people that we partner with. Um, you know, when you, when you go and you look at Champions Arena, it hit 70,000 downloads just last week in the first week of operation.

It's different than quote-unquote Web3 gaming. And I think that you want to lean into the Web3 ethos. You want to lean into decentralization and player ownership of in-game assets and things like that without carrying along the tutorial. Yeah, Jason, on that point of decentralization, I'm linking both the Binance story, and if you can mute your mic, Jason, it would be good just because there's a bit of feedback sound, a bit of feedback.

I want to link the Gala story with the Binance story because the whole concept of decentralization, because do have patrick and christian on stage and going back to binance and i'm mixing and i'm going back and forth between binance and and gala but cc did say that defy is taking over c5 so i'd love to get your thoughts on this statement patrick and christian and what that means for dexes as well. Patrick, Christian? The first thing I'd say is that we've already seen liquid staking has been one of the fastest growing, most consistently growing categories really in all of crypto over the past year.

I think the total amount in liquid staking has doubled from around $10 billion to over $20 billion in the past 12 months. And so I don't really see any reason why that trend wouldn't continue. And, you know, yes, we've seen volume indexes is near a three-year low right now. Liquidity indexes has also been down. But long term, I think it's pretty long term. It seems as though the trend is people moving from centralization. Are you sure about that? Because the narrative makes sense. It's not the first time that narrative comes up.

But then you just talked about the metrics don't lie. The numbers don't lie. It is at a three-year low. Are you sure people won't just get over the whole Binance centralization and what happened to FTX and then go back to the regulated SEXs and regulated central CIFI? The reason why I think that people are going to move there is simply because the fact that Coinbase is betting so big on building out an on-chain ecosystem

tells me that they, being one of the largest exchanges, also think that a lot of people are going to move on-chain. Otherwise, why focus on building out that new platform? They already have a solid centralized platform. Is it a fair argument to make, Rishi, maybe get your thoughts on this and Dave as well? Is it a fair argument to make then that everything has happened in recent months, all the collapses of these centralized entities?

Gala is just another example. We're not talking about the collapse of Gala. We're talking about the issues between the founders. And as Jason said, this is just an issue between founders. But Rand pointed out, this highlights the problems with centralization so do all these stories over the past couple years what we've been through um will that essentially lead us to a another another bull run with d5 with decentralized applications um or is it you know too early to make such statements christian yeah maria yeah i i think it's it's it's difficult to say but i definitely believe that that with all

the regulatory things happening over the last few months especially but also with the outlook and with more people saying that uh the big uh regulations coming in in the coming years will will drive you know more people away from crypto than to it maybe or the other way around that things can still be decentralized, but they always have to go through a central system in order to get to your bank or do anything with fiat funds or to have it connected to your personal finance. And I believe that that will drive a lot of people to the c5 side in the coming years because it will just be too difficult for people to remain on the on the

d5 side hold on so you're saying you're saying that will drive people to c5 saying regulatory action will just make it so difficult for people to use d5 um and then the the whole narrative of things decentralizing thanks to buy you know but the action against binance etc is just an illusion because regulators don't want decentralization and now regulation is here regulatory clarity is here um and we've seen the big guys come in wall street come in that that will move funds back into c5 and what does that mean for d5 then it's difficult to say but i can see it happening that the regular regulations become so so strong strong and so strict around anything decentralized that you basically have to go to a centralized system, which we already know, of course. They already have, right?

I mean, these are the IRS regulations. As promulgated right now, the new proposed rules we just got, they're going to require every DeFi application to do KYC in a 1099. Good luck. I mean, every DeFi application to do KYC in a 1099. Good luck. Every DeFi platform is potentially going to be non-compliant in the United States. I know the United States is only one market, but good luck having a bull run without the United States. This is probably going to happen in Europe and

basically the whole West, I think, in the coming years as well, where they will be very strict on this and that will drive people away. Unless they create it in such a way where companies and apps and everything can still be decentralized, but in order for you to link it to either your bank or your personal data or whatever, you need to run it through a centralized system or something like that. To me, it looks like the regulations will shift it and will make it so difficult for people to be in a decentralized uh being at all in decentralized instead of being uh centralized this isn't like regulation that can come down the pipeline it's been proposed it will go into

effect after the comment period very unlikely to have significant changes and it proposes significant impediments to defy the united states joe, just to be clear, I know you said like, good luck having a bull run, but this would be for reporting in 2025, which means it's in 2026. And we'll already be into the next cycle by then, just to be clear. Yeah, if you believe cycles are a thing. I mean, that's kind of silly. Like, yeah, well, they're not. So I mean, we've already seen this, like through this bear market, tell me a cycle where Bitcoin has been under the 50-week moving average for as long as it is. Tell me a cycle where you had a double peak in Bitcoin, where you had the two, what, 65, 69Ks. You've never had cycles.

There's mythical things that you're trying to do. History doesn't repeat, but it rhymes. I mean, I'll disagree. It's always different. It's always different in the cycles. I mean, you're seeing data on chain that's different. I mean, you're seeing data in volumes that are different you you have a five-year low in trading volumes on these platforms i mean for people to say oh we're just going to be so do you think

prices will be higher or lower a year from now i have no idea i'm not making price forecasts i i actually have i think the sensible opinion which is like nobody knows everybody's just guessing scott before going to david haslop and dave just on that topic, C5 versus DeFi, because I think it is an important topic. Probably should do a whole space on it. I do want to say Jason and Evan, especially Jason as well, to stay on stage because I want to dig into the Gala discussion a bit more. A lot of people in the audience are coming in, and there seems to be a lot of concerns. They're super pissed. Yeah, exactly.

Even I looked at Gala. The token dropped 30% in the last few days you know that's not a 99 drop but people are saying like gala's rugging etc and and you know that has been done about it so i want to dig into it there's a lot more fear than i thought um but before doing that jason again i appreciate being on stage um and and taking those questions and i think the the anyone in the community should appreciate that jason is even on stage um i want to go back to the defFi discussion because I think it is really important. And David Haslop, I'd love to get your thoughts on this. And we'll go to Dave Weisberger.

Yeah, I think the capital flow into the DeFi scenario is actually going to be quite slow. And I think that the centralized finance is is kind of a necessary evil and so is regulation if you want to see a lot of this this legacy capital flow into the markets and you know most most people's entry to the markets are through a centralized space and then it's not until they're in the space already that they start to learn about what defy is so in order to see that capital flow into DeFi, I think a lot of it's got to go through these centralised markets to begin with, and that kind of makes it a necessary evil.

Yeah, but is there a room... Huge advocacy for decentralisation, but I just think that without those centralised exchanges and on-ramps and regulation, where are we going to find new money to keep building it so what you're saying a regulation and those centralized entities are important for adoption for people to come into the ecosystem and later gradually migrate to defy is that what you're saying you still got to get your money out i mean that like i mean to david's point i'm going to let

let him finish but like the notion that we can exist in only DeFi without off-ramps in the current world does not make much sense. My question is, is there room for DeFi in the first place? If regulators continue to crack down on DeFi, would we see that wealth flow into CeFi? Dave, you're giving 100% emoji. Where do you stand on this, Dave? Well, I think that this space has had so much conflation of stuff that it's hard to unpack. But we have to remember, markets are not monolithic. We have everything from individual crypto degens to crypto curious people to small firms that can trade with lots of flexibility to large money managers which things, and to massive sovereign wealth funds.

And the fact is, is the exchanges of the future are going to end up with multiple capabilities. And nobody has this right now. But imagine a world where an exchange can have a centralized counterparty that people can use as a custodian, delegated custodians, and cell phone wallets, as long as the person with the cell phone wallet does KYC, which, by the way, is exactly what happened in cash. I always make the joke that 20 years ago, 30 years ago, you could walk in with a briefcase full of cash and buy a car or buy a condo or buy a house. Can't do it anymore. Can't. So why do we think that you're going to be able to do the same thing with crypto? The answer is you won't be able to.

So that sort of tri-level exchange will be significantly used by individuals in DeFi. It will be much less centralized than today. And it's clearly where the market's going to go. It's just going to take time to get there. Those are good points. And I think the right direction to look in the United States, I can't speak outside of the United States in a real meaningful way, but when we're talking about DeFi, the right place to look is Coinbase, right? I mean, let's pull back and let's take a look from a macro standpoint. Coinbase is the only meaningful exchange that we should give much concern to in the United States. Well, why do I say that, right? Well, take a look at the spot Bitcoin ETF applications. Coinbase is everywhere on that. Not only that, but they are the pipeline to the

CBOE, which is effectively the SSA mechanism for all these spot Bitcoin ETFs, right? There is a clear, clear signal from, even though they're in deep with the SEC, I think everybody on this call would believe that there's a pretty good chance that they're going to win that particular case. But Coinbase, you know, on-chain summer, right? They're doing all kinds of stuff, right? Those guys don't lack intelligence, right? They've got a remarkable legal team. They probably have a good understanding what the landscape is and what the landscape will be over the next two to three years before it even becomes obvious to all of us right and they have no skeletons in their closet which is the most important part this is this is the one entity that didn't all those altcoins in a hurry it didn't allow people to trade without the right kyc measures you know that's the one

you know if you look at all the exchanges they they've all got serious skeletons in their closet. But Coinbase is the one that's up there with the cleanest. And for all intents and purposes, they have enormous scale. Listen, I've at times had my run-ins with Coinbase. But the truth of the matter is they've built a remarkable business. They've taken shots to the face, but they've kept at it and they have a truly significant customer base, right? Well, what they're doing associated with DeFi, what they're doing associated with centralized, their centralized exchange, you can't ignore what they're doing.

You simply can't here in the United States. It is the roadmap. It is the roadmap. The most regulated, the most regulated crypto exchange in the United States, the cleanest exchange, as far as I know, specifically of that size in the united states shifting into d5 allowing c5 on ramps into d5 protocol which is very very very unique it's one of the biggest steps that they've ever taken that's why a few weeks ago i kept saying that base was one of the most bullish things that's happened in crypto it's allowing c5 on ramps onto d5 onto d5 protocol with the token

so that's the point model that no token is the model right that that's the model right there that you know in december you have to see yeah what what you what you're seeing there you can't just see it as a fun hey this is a fun cool thing and everybody's you make a little money on base and we're goofing around and doing stuff that you have to know that that has been lawyered in ways that that would would blow our minds right they feel comfortable doing that for a reason right it's the same reason why you know i put out something yesterday that you know it's sunday so nobody cares, right? But when you have JP Morgan saying spot Bitcoin ETFs are inevitable, and you have BlackRock being one of those that has, you know, submitted, it's over, that's going to happen. Those guys get the answers to the test before the test

is even considered, right? So what Coinbase is doing is they're they're going to be allowed to continue to exist and grow because they're going to have to let somebody do it. You can't not let somebody be the adult in the room in the crypto space. They've essentially been knighted as such. But I think the government would prefer. Listen, I 100% agree with you. I think Coinbase slaughters the SEC in court. I think Coinbase is one of the most important companies we will ever see. But if they had their choice, the government, I think it would be like an EDX markets run by Citadel, Schwab and Fidelity, right? And we would see any incumbents disappear completely. I'm not saying for people to be clear that that's going to happen. I believe in Coinbase very much. But Coinbase may be the grand compromise for them, right? As you said,

the adult in the room from crypto. Right. That is a great phrase to you, the grand compromise. I agree with you there. And again, BlackRock doesn't hitch its wagon, not in a very meaningful way, but doesn't hitch its wagon to Coinbase, which is then hitching its wagon to CBOE. I've had very, very significant lawyers in the space, outside the space in TradFi saying, listen, Coinbase's relationship with the CBOE is much bigger than its relationship with any of these spot Bitcoin ETF players. That is going to be what you'll find is, you know, you see Apple's earnings rotate over the last decade from how much they're selling in iPhones to their quote unquote services revenue, right?

Coinbase will end up being a company where their quote unquote services revenue to all these, you know, issuers of X, Y, Z, it will become a really, really, really big deal. So that's where we're headed. I mean, whether you like it or not, that's, that's where we're headed, you know, effectively Coinbase. And I hate this analogy, but you know, Coinbase will end up being the bank of America or the JP Morgan of crypto in the United States. That's what it will end up being. Mario, just really quickly, and I think that just something that we touched on here because it's about the CeFi, DeFi, and I know you want to move on. But that bridge between CeFi, DeFi is so important.

And that's why I think base, as Rand said, is so important. And there are also other huge centralized exchanges. I mean, Binance did try it, to be fair, with Binance, Smart Chain, all of those. But OKEx, for example, has a huge Web3 presence. That is available to United States customers. And they've found a way to branch CeFi and DeFi. And I think that's what we're going to see as the roadmap for most centralized exchanges. They have to somewhat interrupt or disrupt their own business with decentralization and DeFi to be able to exist into the future and to be able to service people in jurisdictions where the centralized exchanges are not allowed. I think just one other thing about... How cool is it that they saw that?

Yeah, I think just let's just talk about a few things around Coinbase. So number one, the exchanges make money out of derivatives. They've just launched the International Derivatives Exchange and they are the first guys to get legal derivatives in the United States. Up until now, no one has the right to do legal derivatives in the United States. None of the crypto exchanges have the right to do legal derivatives in the United States.

And Coinbase has been the first one to be able to get legal derivatives in the United States. Exchanges make money off derivatives. There's no money in spot. Spot is zero. Spot fees tend to be zero. Yeah, but I don't think it's reasonable. Just to be clear, I don't think it's like perpetual swaps

in the BitMEX and Binance. It's effectively futures that will compete with a CME or something like that. It's leveraged futures. It's leveraged futures, which is very similar. Yes, granted,

it's not perpetual 100x leveraged futures, but it is leveraged futures. It's leveraged futures, which is very similar. Yes, granted, it's not perpetual 100x leveraged futures, but it is leveraged futures. Absolutely. I just think there was a lot of people who, when they saw that news, thought all of a sudden that's a longer term play right that that is a longer term play and to say it is uh you know not necessarily that big a deal they're the only ones that have been given that license it's a huge deal that makes them an institutional players guys futures themselves are derivatives the c CME has futures authority for Bitcoin. I mean, the CME has authority to do futures derivatives right now on Bitcoin. I don't understand what you're saying. Somebody said a comment that no one's gotten derivatives approval in the United States.

That's just not true. No, the point that I'm saying is that Coinbase is the only crypto exchange that's received it. Again, that's another marker as to they've been knighted as, okay, we have to in some way, we're going to be forced to allow somebody to be this company. And okay, we'll allow Coinbase to do it. That's just another marker. I don't disagree with you. But the curious thing is that seems logically inconsistent with the SEC suit. The SEC suit alleging that they don't have the ability to function as a broker dealer

they're not a properly registered clearinghouse or exchange those seem inconsistent i mean you one of one has i appreciate the fact that it seems inconsistent but the sec has been taking it in the dick uh for the last six months right but they might they might take it in the dick for the last six months. I don't disagree, right, but they might take it in whatever body part you want to call it. I'm going to snap that. Yeah, I know. We're going to get a clip out of Crypto Town Hall. The SEC is taking it in the dick. Andrew, you've got the clip of the day.

But bureaucrats are extremely stubborn. Sure. They have that suit. It's a new filing, right? And there's nothing to say. I don't disagree. Eventually, that's the way it goes. But that could be two years from now. So if I could verbally, and if anybody follows my handle, I often will simply post Larry Fink's face. So my response to the SEC, and it's a serious involved, I'll verbally post larry fink's face right here right

so so that's the response to the sec's issues with coinbase coinbase is tied at the hip with the biggest financial organization on the planet as their ssa process for spot Bitcoin ETF. The reality is, is ultimately the SEC will lose. They may be stubborn. They may, you know, appeal, yada, yada, yada. Coinbase is moneyed. They have the ability to fight it till the ends of the earth. And whether they pay a fine, whether they delist a few things, that doesn't matter. They are literally adjusting and shifting their revenue streams as we speak. I don't disagree, but the question is one of timing. And they become stubborn a lot longer than you think. And again, that's fine, but also leadership at those organizations adjust is adjusts and changes

so that's also true right and my my guess is um that the friends that coinbase has now in the traditional space i don't know i'm not gonna bet on on Kerry Gensler and the SEC folks. And everybody knows that I talk to people inside of the SEC. Sure. Yeah. I mean, I've been told literally a thousand times that Coinbase was in trouble until they decided, as an organization, that's enough. Burn the boats. We're going to court.

And we'll go to court until they just get tired of us going to court. And that's how they win, and that's what we've seen. That is their – that's what they've chosen. I think that makes sense. Mario, I think we should probably, because we had so much heat around it, circle back to Gala. I think that's kind of the breaking story at the moment. Yeah, let me just read a tweet by Evan, who also quote retweeted Jake Browatzky about Gala Games. So Evan Luther Street says, Gala going to zero. Obviously, he's getting attention.

I don't think Evan thinks it's going to zero, but we'll ask him. He's on stage with us. Gala is one of the largest ecosystems in the Web3 industry. The founders of Gala are suing each other over 130 million dollar theft crypto theft and then jake has the charges uh broken down six charges then zach xbt is pretty critical has been critical of gala last year but let me read out the charges of jake or the the charges that jake tweeted asset misallocation uh schurmeyer whatever one of the founders reportedly siphoned 600 million dollars from gala gains for personal use number two unethical loans so one of them is accused i think same one

is accused of borrowing heavily heavily from gala gains for personal gain number three competitive conflicts established rival entities in switzerland and dubai jesus those founders really went all out number four power manipulation excluded board members board member thurston from crucial decisions um it just seems like two founders having a fight i don't know who the unethical one is or both of them are fiscal responsibility submitted flawed or incomplete financial reports all right this is getting criminal and number six depending where they submitted it number six opaque practices concealed key corporate documents from true north i'm not sure who true north is jason since you're

on stage and evan's on stage as well, these allegations are more serious than I initially thought. And I understand why people in the comments are going pretty wild about us covering this and the allegations being made. So maybe give us your thoughts again. I know you said you can't comment too much, and I respect that. But give us some thoughts. I know you're a believer in decentralization, but could decentralization in this case kill the potential of Gala becoming a successful decentralized ecosystem?

In the long term, no. Oh, sorry. You asked about me here. Sorry. Oh, yeah. You can go first. Go for it, Jason. And Evan will probably crush you. We'll see. I just wanted to throw a couple things out. The first is that those, basically everything that you just mentioned, that comes from the countersuit. So you should probably look at both of them. I'm not going to comment on the validity or veracity of either, but probably read both and potentially in order. So that's, that's the first thing. The second is, I'm not sure Jake went through it in that order.

But, but yeah, I don't think that in the long term, this is going to impact the ability for this to become a viable decentralized ecosystem for gaming and entertainment across all verticals. But I'd love to hear what Evan has to say. And we can we can kick that around a little bit. I mean, my opinion would just be that any time there is a significant drama between the founders, most of the times the company will not come out better out of it. Right. Especially when it's the co-founders who are having this drama between them.

We don't know what are the facts yet. That's why there's a legal process that's going to play out and we'll know what actually happened. One guy's blaming the other one for embezzling funds. The other guy's blaming for selling tokens, both of which are negative for the investors in the ecosystem.

It is possible that, because Gala is, at the end of the day, still a decentralized product. A lot of the control is outside of the founders' hands, but they have significant sway on the market. So do think that they because there's such a just a nascent space and there are so many other deals and projects doing so much so well um maybe the other ones will take this opportunity and really do well but but i think it's going to be really hard for the guy to come out of this and maybe that's how we saw the the shift of money into Ultra and Vulcan Forged. I know you can't compare them on a like-for-like basis,

but I think the one thing what we're saying here is you cannot claim that Gala were decentralized. I mean, right now it's a completely centralized entity. When you've got the two founders of a centralized entity fighting like these guys are fighting, it can't end well. It simply can't end well. Evan, how big is Gala Games?

Just for anyone that's not in the gaming ecosystem, like me and you know, me and you are pretty big investors. Again, for anyone that doesn't know, Evan is the one that convinced me to get into Web3 gaming relatively early when I thought it was all a pump and dump scheme. So, Evan, you're pretty deep in the ecosystem.

How major is this for the ecosystem? Evan, you're muted, man. Oh, well, I'll answer Evan's question. The Gala Games is pretty massive, guys. That's why we're seeing some funds move from Gala to other games. I don't know what their market share is. Maybe, Jason, you could answer that one and then maybe respond to some of the points that Evan made, including the point that it's very hard.

It doesn't matter who's, you know, what the facts are. When you have the two founders and they have such sway on the market, so many tokens they hold, it's hard for a project to come out to survive such a split. Actually, that's a really great point. I want to dig in on that a little bit. They don't hold tokens. That's kind really great point. I want to dig in on that a little bit. They don't hold tokens. That's kind of the point. And that's one of the reasons that I say that this isn't an issue for the company as a whole. It's very much a thing between the founders.

There are no massive amounts of tokens that these founders hold. There is one major wallet that is identified on chain. You guys can see it on Ethereum. And it's got it's got a couple billion gallon. And that's all that the company and the founders at this point in time hold. So that's very interesting. What percentage of the supply is that? Right now, I think it's something like 8% or something. I can go look right now. I don't actually know off the top of my head.

It's in a multi-sig locked wallet. No one has access to it. It would be under the... But if that's the case, why are we seeing other like Vulcan Forge pumped over 30% in the last couple of days. So why are we seeing funds flow out of Ghana at that level if it's not really that impactful for the for for Gala itself for the company itself?

I think that there's a lot of narratives that people are pushing right now that have they have vested interest in seeing some of those changes take place i think that if you were to again totally not commenting on this in terms of uh price or anything like that but if you go and look at the the short interest and things like that you will see that there's definitely some reason for people to push certain narratives um i think that in time you know as people see more of what's actually going on and look at the project, you know, not necessarily from a headline perspective, but look at what's actually taking place, then, you know, some of those factors may change. You know, I mean, we got

391 people in 36 countries building right now. You know, these are employees, these are not, you know, these are not like, random people. And yes, of course, this is a centralized entity. It is a company, obviously. That doesn't mean that we're not building a decentralized ecosystem, I would definitely point out that those are two very different things. And one of the reasons that you have a centralized entity is that you have to have, you know, some people there to organize and build stuff. You know, I mean, as much as I love, you know, I love the ethos of decentralization, absolutely love it. But at a certain point in time, you do need centralized entities that make things happen. Just like if we're talking about,

you know, on ramps or off ramps, and in, you know, defy, you know, there's always going to be some sort of centralized entity somewhere that actually pushes and gets things done, builds it, and then decentralizes it for the rest of the world to then you know take and run with and that's that's what this is that's what gala chain is that's what all of the games that we're we're building ultimately are hoped to be able to do you know it's it's about creating something and then giving it to the world it It's this birth of content, of technology, of a substrate that people can build on. That's the whole point.

You know, there's definitely a central identity there, of course. Nobody's ever said there wasn't. Talking about a platform, you know, taking a big hit and talking about a survival of a platform, maybe going back to Staked, Scott, I don't know if there's any updates there because I stopped. Yeah, I think it's a huge deal when a platform obviously removes deposits and withdrawals, even if temporarily.

So I think that's something we should maybe track and discuss tomorrow. I was listening to Jason talk about Gala. The thing that always strikes me in these conversations, but before we move on, if we're going to, is that like, once again, it seems like these platforms could be very successful without the token doing shit. And so it's like, why did that even need a token to be an incubator, to do the business that they do? And so I think that there's always risk in viewing yourself as an investor, as if it was a stock in a company when you actually

just own the token for it. Also, I just think it's just nonsensical that the quote-unquote volume flows from Gala to these other projects when they have nothing to do with it. That's just a bunch of traders chasing narratives and trying to figure out where money is going to go. Imagine if Amazon had an issue and everyone was like, oh, we're just going to put our money in Google instead. No, not Google. No, no, no. No, no, it's not absurd. If you're betting on the Web3 gaming and the leader takes a hit and you start questioning the survival of the leader,

but you still believe in the ecosystem, then it wouldn't – if Gala does collapse, which I don't personally form an opinion, I don't think it will, but if it does collapse, yeah, but if that narrative is gaining traction, then it makes sense for investors to go to other games because users will shift to other games and people that sell Gala that believe in the ecosystem need to bet on another company, another protocol. I mean, I guess that's true. Like if you have, say, 10% of my portfolio is going to be in gaming and that has been sitting in Gala, you might move it to another place but i just think that those those are very temporary and scary narratives if you're investing on it because you're moving to something that's fundamentally different

and doesn't because you're moving your money to it the token this is it goes to my exact point i was about to say the tokens in these other ones will now go up in value but nothing's fundamentally changed for them exactly i was about to say there's not i mean there's not many ecosystems that are similar to the value ecosystem so. So you say, okay, well, just jump to another ecosystem. It's like, oh, well, I believe in gaming. I used to like Gala. Now Gala's gone down. Okay, well, let me just put it into something else.

It might be a piece of shit. I'm not saying anything might be a piece of shit, but that's like what we're saying here. Yeah, that's exactly right. There's just some updates. We're blockchain treated. So gambling platform stake is suspected of being under attack. The lost assets include 6,000 ETH, $3.9 million in USDT, $1.1 million in USDC or $1.1 million in USDC and 900,000 DAI, which have been transferred or exchanged for other assets. And nine minutes ago, he said, while Ethereum funds were being transferred, BNB chain and Polygon assets on stake were also transferred in large amounts.

And ZachXBT monitored a loss of approximately $ 25 million dollars and he adds a link there so that came out yeah on top of that the stake twitter account is just tweeting as normal and hasn't addressed it i mean that could just be a uh stupid intern as we know the social media person but uh it has not been addressed at all. I don't think Reminds me of the crypto hold it account over the weekend, which was just crazy hot fire. That was hot fire Whoever was on the account, I think it was Mario. Were you taking Adderall bro? So so going yet, so I've got his a CXPT saying looks like So I'm issuing the updates another 25 million dollars was drained on and Polygon, and that's on top of a $15 million that was drained an hour ago.

I don't know about the stake, just tweeting just as normal. For me, it doesn't mean that these allegations or we're looking too deep into it because withdrawals and deposits have been halted. Scott, what was the source of that? Scott, what was the source that withdrawals and deposits have been halted. Scott, what was the source of that? Scott, what was the source that withdrawals and deposits have been halted? Was that someone or Stake himself? Yeah, we saw it in our news feed. I'm looking for the tweet. Sorry, my mic.

I missed with my thumb there. But I'm trying to find it. It's in our news group. Sorry. Oh, yeah. I'm just looking at their tweets. It does look like normal. And let me see the comment.

They had a tweet 13 minutes ago talking about another game um yeah people the comments are just destroying them talking about the hack um so uh uh yeah so good luck you know again if it is a high good luck to the stake team and we'll keep updating this if it does get if it doesn't escalate and it's pretty major and we'll try to do like an it was from an account called infinity hedge i believe i don't know it's only a screenshot that we have of it. But it's with an EtherScan address and says stake suspended deposits and withdrawals. That's all I can see. So that's coming from EtherScan. Yeah, yeah, cool.

So that's from one source. But definitely a lot of red flags there. But, yeah, I think this is – I think we've got a sponsor. We've got a sponsor tweet that's up for everyone to have a look at, sponsor for today. So I highly recommend you all check it out if you go on your phone. It's DLPDOP again, one of our favorites. Maybe, Scott, maybe give us another quick 20-second update on who DOP is because we love these guys. Yeah, sure.

I mean, I'll just give you the very broad strokes is that all of us know that when you send a transaction from one wallet to another, generally it comes with your address and then the person who's received that transaction can click on your wallet and see everything you've ever done. So imagine if you sent someone a bank wire and then they could see your entire banking history, how much money you have, who you've ever paid, who you've ever done. It's kind of the downside, obviously, of the very transparent public ledgers that we so much love. So what this effectively allows you to do, and it goes much deeper than this, obviously, but allows you to abstract that away to send the transaction, but to basically hit a button and it goes privately and they can't dig into the wallet that it came from or any of the information there. That applies for privacy behind all information, not just obviously with those transactions, NFTs.

It's really, I mean, listen, people use privacy tokens for things like that. But if you care about your privacy in the future, this could be one of the very powerful ways to make sure that everything you do is not transparent to everybody. Yeah, and look, the best way to simplify for everyone listening is privacy on the blockchain. One of the main issues with the blockchain is that it is one of the beautiful things and the ugly things about the blockchain is that you could see everything is everything's very transparent that's why whenever someone makes allegations that you're doing crypto is like hey provide me the transaction house the easiest thing to do but the downside of it is that that completely destroys privacy like if scott now

uses his wallet and goes to get him a happy ending massage in thailand everyone will know scott is getting a happy ending massage in Thailand, everyone will know Scott is getting a happy ending massage in Thailand. Well, they would have had to have been at that place and know the name of it to know that that's who I was paying. So they're probably culpable and guilty as well. Don't be too defensive. It's a case, Scott. And I've added the gala discussion. We'll cover that tomorrow for SQA.

Mario, is that what biohacking actually is, by the way? You want massage want you want you come for a long time how long time you come 60 minutes guys well i'm you're saying this while i'm in the sauna so uh um okay i'm not gonna make an inappropriate joke otherwise look i think we should wrap now there's a good space if the space. If there's more updates on stake, we'll cover it here. If it's major, otherwise, we'll discuss it tomorrow. And yeah, I think it's a good discussion. We talked about Gala.

We talked briefly about the markets and the FTX sell-off. This could be coming. And then we have what happened during the space itself. It reminds me of FTX. When I was doing a crypto space, FTX hack began. And then Kyle, I'll never forget that. Kyle is like, I'm like, Kyle, Kyle Chassé, Master Ventures. I. And then Kyle, I'll never forget that. Kyle is like, I'm a Kyle, Kyle Chassé, Master Ventures.

Like, Kyle, are you worried? He's like, Mario, I wasn't. He's usually always chill. Like, Mario, I wasn't worried, but now I just got a notice from my team just a few seconds ago that FTX just halted withdrawals and deposits. And now I'm worried.

And that was the beginning of the FTX saga. So, you know, kind of getting the same feeling here from Scott who announced that stake halted withdrawals and deposits. But obviously, it's not the same thing. I'm just saying that could be something going on if that is actually accurate, if they did halt withdrawals and deposits. If we've learned anything from crypto is when deposits and withdrawals on a platform are halted, you should probably pay a lot of attention. Yeah.

Again, hopefully, the hack's not too major. And Stake, you know, they've got a lot of funds. So hopefully, it's nothing too bad. And, you know know our thoughts go with everyone that has money on stake and guys i think we should wrap it up rand scott what do you think i agree cool all right guys appreciate it we'll see you again tomorrow same time and appreciate everyone that's joined on the panel and for everyone listening just do me one favor before leaving the space go on the panel you'll see that big red logo it's a beautiful logo very very beautiful logo so make sure you follow that beautiful logo because we'll be hosting accounts we'll be hosting our spaces from that account so if you want to get notified make sure you follow

the extraordinarily beautiful logo on stage and thanks a lot everyone really appreciate it we'll see you again tomorrow same time bye everyone thank you guys