The Wolf Of All Streets - Major Turning Point In Crypto! | Crypto Town Hall With Gareth Soloway, Eric Balchunas, David Tawil & Others

Episode Date: August 4, 2023

Crypto Town Hall is a daily Twitter Spaces hosted by Scott Melker, Ran Neuner & Mario Nawfal. Every day we discuss the latest news in the crypto and bring the biggest names in the crypto space to share their opinions. ►►OKX Sign up for an OKX Trading Account then deposit & trade to unlock mystery box rewards of up to $60,000!  👉 https://www.okx.com/join/SCOTTMELKER  ►►THE DAILY CLOSE BRAND NEW NEWSLETTER! INSTITUTIONAL GRADE INDICATORS AND DATA DELIVERED DIRECTLY TO YOUR INBOX, EVERY DAY AT THE DAILY CLOSE. TRADE LIKE THE BIG BOYS. 👉 https://www.thedailyclose.io/   ►►NORD VPN  GET EXCLUSIVE NORDVPN DEAL - 40% DISCOUNT! IT’S RISK-FREE WITH NORD’S 30-DAY MONEY-BACK GUARANTEE. PROTECT YOUR PRIVACY! 👉 https://nordvpn.com/WolfOfAllStreets   ►►COINROUTES TRADE SPOT & DERIVATIVES ACROSS CEFI AND DEFI USING YOUR OWN ACCOUNTS WITH THIS ADVANCED ALGORITHMIC PLATFORM. SAVE TONS OF MONEY ON TRADING FEES LIKE THE PROS! 👉 http://bit.ly/3ZXeYKd  ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEK DAY! 👉https://thewolfden.substack.com/   Follow Scott Melker: Twitter: https://twitter.com/scottmelker   Web: https://www.thewolfofallstreets.io   Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Bitcoin #Crypto #Trading The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Hey Scott Hey man, how's it going? Good man, what are you upset about today? I'm not upset about anything, I'm feeling great Oh cool man The markets look good? Market feels boring, maybe that's a good thing Let me send out the invites

Yeah And by the way, I'm really happy to hear how much you loved yesterday's space I did, I enjoyed it You're being sarcastic, yeah? No, I'm really happy to hear how much you loved yesterday's space. I did. I enjoyed it. You're being sarcastic, yeah? No, I actually enjoyed it. Really? Yeah, I enjoyed it.

I enjoy all the spaces. There's topics I like and topics I don't, but I'm hesitant sometimes. I don't know how they're going to end up, and I hate to platform certain ideas. I think it was great. Actually, it made me much more bullish on NFTs. Yeah, I know. I loved your take.

It's like everyone looked at NFTs as a bloodbath, and that made you bullish. Yeah, it's not only that. And I'm not criticizing anyone. We've all been there. But all these guys with literal, like, Bored Ape PFPs and other PFPs, and they're all telling you it's dead and it's stupid. That's perfect.

That's what a bloodbath looks like. Yeah, I mean, that's the sign of capitulation. And we've all certainly been there. It's like when you're the most passionate person in the room about that thing and you've been defending it, and then you just come in and say, yeah, we were all wrong, I'm a buyer. Yeah. By the way, I want to give a shout-out.

I see Rishabh in the audience from TD5, my friend's there. You know Gaurav, Scott? Yeah, where is he? He's here? No, his right-hand man is here. His name is Rishabh in the audience from TD5. My friend's there. You know Gaurav, Scott? Yeah, where is he? He's here? No, his right-hand man is here. His name is Rishabh. Oh, that's because you and Gaurav right now are like icing your bodies while eating your brains.

No, no. Some kind of spiritual yoga retreat somewhere in the mountains. What is it? Oh, the spiritual. Man, I messed up that. So they invited me to go there and and do some spiritual retreat and my team loved it so i had two of my colleagues

there and they loved it uh but i was so bad because i had to run the show and i was so i would rock up to the to the meditation sessions an hour late and everyone gets kicked out all my team gets kicked out because i was so late and the the main guy the the teacher the master i think they call him was like pissed off at me for being so late i was like terrible for that retreat i'm sure i'm not going to be invited again even though they said you are i am mario i need to chat to you about something right um your assistant tells me that you're spending about three to four hours a day biohacking. Have I got the numbers right? Yeah, about four hours a day. Okay, so four hours a day biohacking.

How much longer do you expect to live? Well, my goal is to delay it as much as possible until we get to a stage where you could actually perpetually delay it. You can stop aging. And there's a guy that's already getting there. There's a guy, Brian Johnson. He's so many steps ahead of me, it pisses me off. That's the guy with 30 doctors. Yeah, the guy with 30 doctors who's monitoring

his erections. Exactly, this guy. That guy pisses me off how far ahead he is. But hold on. He apparently is having heart problems because he took the mRNA Moderna vaccine. Is that right? I didn't look into it too much. I'm just wondering because if you're spending five hours a day,

that's like 25% of your waking day biohacking. I mean, you've got to live for at least 40% longer, right? Yeah. No, but then again, I don't sit there doing biohacking and that's it. I actually work while doing that. I review your shitty agenda and I prepare for the space and I talk to Scott and deal with his complaints. I do all that stuff while biohacking.

Even do the space. Sometimes I do the space, as you know, while I'm biohacking. So it's pretty productive. Hold on, hold on, hold on. You also deal with Scott's complaints because I thought I was the only one dealing with Scott's complaints. It's factually true that 20 minutes of dealing with me a day shortens your life by 25 years.

So actually, Mario is just trying to counteract. I balance it out, yeah. And it's working out well. I'm pretty happy, but I know I'll get to a stage where I'll get depressed. But until then, I'm happy. I mean, when you made this partnership with Scott, did you anticipate that you would have to be dealing with an emotional – what's the word? Premenstrual?

You can't say it for a guy. Yes, 100%. I knew it from day one. I already knew Scott is a very emotional man. I have to be very – You want to set the bar exceptionally low so that you can impress people guys this is this is uh this is partnership one just piss everybody off really fast and then when you do better in the future though and when you get to know him you we realize a little cuddly cuddly teddy bear under that that thick thick thick shell yeah you know

when you see last thing i'll say you know when i don't know if you wash your shorts do you ever see those turtles in the in that floating in the ocean they got all these different shells on them and they're very thick shells you have to scrape them off because they can barely swim because they've got all these it's almost like scars and there's people that just pick up those turtles they'll see turtles and remove the shells am i the only one that watches those videos yes well then forget my example it doesn't work at all if you haven't seen it um am i the turtle or the shell or the scraper? I just still need to know.

You're that turtle that has so many shells because you've been through so much over the last few years in crypto, probably prior to crypto as well. You're like, fuck this shit. I'm done. I'm not going to deal with scammers. If there's smoke, there's definitely fire.

That's why I come here, because you guys actually, you know, I have strong opinions. All right, so let's kick off the show. I want to thank our sponsor, Hex, to start off the show. Oh, my God. All right, Scott, I'll let you kick off the show, man. I know today we're going to talk about DeFi. I don't know who chose the title, but I know we're talking about the d5 uh the curve saga

and what happened since and whether we had a speaker come on stage and say mario's the final leg of this bloodbath will be led by d5 that will be the final capitulation and made a pretty good argument those um i'm not good with names i've got prosopagnos ben cowan it was ben cowan into the cryptoverse and actually it was uh he was was sort of piggybacking on something I said. I was just making the point. I was not saying that specifically. I was just making the point that you have to be hesitant about DeFi right now when a single loan by a single person could effectively systemically destroy the entire system

or set it back. And then he jumped in and said, maybe that's the reason that we will get what I'm already watching for with Bitcoin dominance and his cycle. I actually had him on my, I actually had him on my show today. So how, yeah, actually, how was it? How was the discussion? He's a really good speaker and I love, I love listening to him.

How was the show? So look, he's one of the smartest guys I've ever met. I love his content. And I think he's, he's got very rational views. I wish I could be a little bit less emotional like he is. He's a very unemotional trader. He's very, very, very smart. There's no bullshit. There's no

noise. Yeah, I love people like that. He's kind of the exact opposite of me. He doesn't get excited. He's very regimented in his approach and I think he's fantastic. The show was really, really good. Yeah, I mean, maybe we should just recap the whole Curve thing for

people who haven't been listening and maybe in two seconds just recap what actually happened, what the dangers are. It looks like it's a little bit behind us now. If I look at the price of Curve, the price of Curve is actually recovering very well, which tells me that all is good.

But Scott, maybe you want to just recap what actually happened. Yeah, obviously there was a Curve hack, right, which was called a re-entrant debug. We've already sort of discussed all of that. So we won't talk about what specifically happened, but there was a hack to the protocol. Obviously, that caused people to sell off the actual CRV token. But the story that became the bigger story, even than the hack, which is kind of crazy, is that the founder effectively had this major loan that he had taken out, well over collateralized with CRV. We've seen numbers up to about $100 million with $60 million left and then $40 something million

left. And it was over collateralized with over $300 million worth of60 million left and then $40-something million left. And it was over-collateralized with over $300 million worth of CRV token. And effectively, it got within $0.08 or $0.09 of his liquidation price because of the hack, sort of an unknown unknown. If that hadn't have happened, he probably was living comfy and there was no major issue. But if that had been liquidated, or still could, I mean, anything's possible, it could have sent shockwaves through all of DeFi because all of these platforms are obviously tied very closely. And because this guy had such a sizable loan and DeFi does not really have the TVL to support it necessarily, that it could have caused major problems for DeFi. So he's been selling tens of millions of dollars worth of CRV tokens to the likes of Justin Sun, other institutions,

on handshake deals, basically saying these will be locked up for a while. You can't go ahead and sell them. And reducing, taking that liquidity to reduce the loan and solve the problem. But to me, this is a massive, guys, I love DeFi, but there's a massive red flag. Listen, and, you know, it's a two-sided argument. You can support decentralization, of course, and all of the potential problems that come with it. But I think there's lessons to be learned here that should have been learned before.

One, is that loans big enough to crash all of DeFi probably shouldn't be given. And two, that coins like CRV or FTT, although they're not the same, massive amounts of founder coins in extremely illiquid tokens that are volatile are probably not pristine collateral. Does that summarize it? Yeah, it does. And Brian, before you add on to it, can you guys explain as you add on to whatever Scott, if anything, Scott missed, how did this become systemic like isn't that just the founder of curve just taking on too much debt why is that becoming such a big issue or was a big issue look i mean we probably should have picked up these issues a little bit earlier but curve is at the center point of defi and the

reason why curve is at the center point of defFi is because Curve allows for the quick trade of like assets. When you say like assets, like USDT and USDC, USDC and DAI, if you want to swap one stable coin for another stable coin, Curve does this through advanced technology. So it's quite, it's a center point for DeFi. It is, if you

remember when UST collapsed and Luna collapsed, it was, it happened, it it was they were allegedly attacked when they when they moved funds from one curve pool to another pool because curve is the center point for the health of the stable coin pairs in crypto now why is it important because we trade mainly against stable coins so you trade btc to usT, BTC to USDC, all your derivatives to USDC. So the stablecoin component is really the hub, the stablecoin component in crypto actually is housed in Curve. Now, the oversight from the community is it seems like the founder owns 47% of the circulating supply curve, which is, it sounds to me like a very high number, but that's a number that's been thrown around.

Now, what he did was, and it's very clever what he did. It's actually, most founders actually do it. They say, look, if you really believe in your protocol, you don't want to sell your tokens. But on the other hand, you want to spend some money because you've built an amazing protocol that people use. And so instead of selling your tokens in the market and paying tax, a capital gains tax on the profits, what you can do is you can stake tokens and borrow against them. That way you get to use the money, but you don't actually pay tax. So, I mean, that's the genius behind this whole thing. It's like, not only do you still remain invested in your own protocol versus selling because you want to buy a house, but you remain invested and you take a loan

against your tokens and using your tokens as collateral, but you don't pay tax using the money. That's really the genius here. And that's something, so just to be clear for the audience, this is pretty common. This is not something unique for crypto. This happens in Tractify all the time. That's literally the genius. And that's something, so just to be clear for the audience, this is pretty common. This is not something unique for crypto. This happens in TradFi all the time.

That's literally how billionaires remain billionaires. Exactly. No question. That is the playbook, is take loans against your assets. The owner of this platform purchased Twitter by doing exactly that. So Ryan.

So the systemic risk is that the problem is because you have so many loans and you know how these loans work, you get to a price which is a liquidation price and because it's DeFi, the protocol just then sells the tokens on the open

market. So right now because we have no liquidity in the market, the problem is that the loans and Aave, if they would have hit the liquidation price, the protocol would have just started selling the token, so to speak. And the result is that the value of the tokens would have gone down very, very, very quickly. And as a result, Aave protocol would have lost a lot of money because they wouldn't have been able to get the full value of their loan. And they would have had to make a bad debt now i'm using rv as an example

but bear in mind that there were other platforms like fraxland which was which were in exactly the same boat so why is it systematic because a we we don't want curve to fail but in this case i don't think curve would have but a lot of DeFi protocols would have taken losses. And maybe some of them would have taken losses slightly bigger than what they could sustain. Aave does have an insurance fund or a liquidation fund or whatever you want to call it. But still, not a great look for DeFi. If you ask me what I think the systematic risk or the problem, what caused the problem here is, why does the founder have access to 47 percent of the circulating supply of the tokens that's for me that's the point where i'm looking

at and i'm going you know what's going on here why does this founder 47 percent of the of the circulating supply of token doesn't make sense okay and then but you didn't you didn't get into how that becomes systemic to the entire space like this might harm Curve and cause a bunch of liquidations. And DeFi itself. And bad debts. Fair, fair. I understand. But this is the beauty of DeFi.

The fact that this gets triggered automatically and that level of transparency, that we're all able to see it on chain. It's something that doesn't exist. In TradFi, the issue happens that all this shit happens behind the scenes and no one knows about it. It keeps building up, building up, building up

until you have something like 2008. But what you had here is that we all saw it unfold. It was all priced in relatively quickly. So for me, that kind of demonstrates

the beauty of DeFi. So I was about to say that. I think it's extremely bullish. Why do I think it's extremely bullish? Because I think DeFi needs to get attacked from multiple angles so we can block these. Every time we get attacked, we block the attack vector.

So now the market's seen this attack, and we're going to know that either the other protocols are going to change their – they may put in systems and processes in place where you can't stake more than X amount of the token circulating supply just from a pure liquidity point of view. I don't know how they're going to patch this,

but they're going to patch this, and that's going to make DeFi stronger. Yeah, I agree with all of that, but I think that you have to also look at both sides. And this is a guy who's well-connected, who's been able to bail himself out through OTC deals with very powerful and wealthy friends. And if it was not that case, this could have been much uglier. I mean, that's all I'm saying. But I do agree with you that this is a work in progress.

I just think it would be scary to have tens of millions of dollars in DeFi right now as an individual or otherwise, if you know that these kind of things can happen and that somebody else's loan could effectively be systemic and affect yours. But moving on, I do want to move on from this. We can even circle back, but we do have both James Seifert and Eric Balchunas from Bloomberg with us. And so since they're both here, I don't want to miss the opportunity to talk about everything that's happening right now in the ETF world. I know, Mario, it's very triggering when we talk about serious topics like this.

No, the ETF one, look, I care about my bags as well. So I want to know as much as I can about ETFs. Look, Scott, you've got to remember, Mario doesn't understand half the stuff, so we have to go slowly, bro. What is ETF? Like, Echo? I have no good joke.

Sorry, go ahead. Yeah, I don't know. We can move on. But maybe James or Eric, or I know you guys are like Batman and Robin. I'm not saying which one is Batman or which one is Robin. But maybe you guys can give us the broad strokes on what's happening in the ETF space right now, obviously, on the backs of the BlackRock proposal, the rush in for Bitcoin spot ETFs and what's happening on the ETH side and the odds, which you guys have raised to 65% of us seeing an approval. Yeah, so we've gone 65% on spot Bitcoin and we've actually gone 75 on Ethereum futures. I think Eric, I'll let Eric comment after I'm done talking, but I think he's probably, he might even be a little bit higher than 75 on

Ethereum proposals. We're up to 12 filings that include Ethereum futures ETFs from seven different issuers. And the reason why we went up to 75% is as many of you are probably aware, there's already a 2X Bitcoin futures ETF that was just launched by this company called Volatility Shares. They're the ones that started this spurt of ETH future filings. They filed for one on Friday. And then all of a sudden on Tuesday, Wednesday, and yesterday, Thursday, we had another 11 filings come out from a bunch of different issuers. And there's multiple sources citing this. We've talked to people that have cited this. Basically, the SEC went to these issuers and said,

all right, we're now going to be willing to review these applications, which sounds very passive, right? Like, all right, we're going to pretend like we're reviewing these applications. But these are the type of words they use. Like when Gary Gensler, the reason that Eric and I were so adamant that we thought that a Bitcoin futures ETF was going to get launched in 2021 was from a speech that he gave on August 3rd of 2021. And he basically outlined the plans. And all he said was, we look forward to applications holding the CME Bitcoin futures ETFs using the 1940 Act wrapper that has stronger protections. And like, that's all he said. And really, that's what

ended up coming out now the thing here is like we didn't actually hear anything from the sec this didn't come from a gensler speech so it's a little bit weaker but all these issuers were told basically everyone reapply now could the sec just be like pretending or feigning interest in doing this yeah i guess that's theoretically possible but when they do this and they're basically opening the floodgates for all these issuers to apply for ETH futures ETFs, it's typically a pretty good sign that they're going to do it. And I've said this one last thing is just that the reasoning for not allowing ETH futures ETFs has always been very weak. The one thing I thought they could always do is if the SEC goes out and does some sort of lawsuit like they've done with Ripple and plenty of other things and claim it to be a

security or do something along those lines, then it would make sense why they wouldn't allow an Ethereum futures ETF. And we all know Gensler won't say whether it's a security or a commodity, but there has been no real legal or factual basis for allowing Bitcoin futures ETFs and not allowing Ethereum futures ETFs as far as I'm concerned so I think also part of it might be like look the SEC staring down the barrel in this Grayscale case they lost half the battle in the Ripple case they also just lost the lawsuit to CBOE in the same DC circuit court that Grayscale is fighting them with. Two judges on the panel are also on the panel for Grayscale. So part of our thinking is it looks like the SEC is fully pivoting here, at least on Bitcoin and Ethereum. And I think

they're going to basically just, it's not worth it to fight this. The cases or whatever they would have to go through aren't as strong on Bitcoin and Ethereum. And I think they might be seeing that and pivoting and being like, we're going to focus on all the altcoins or shitcoins, if you will. So that's my overall thesis in case. I don't know if Eric wants to add anything that I might have missed.

Guys, just before you add, so I just saw an article from CoinDesk. The Curve Explorer responded to the bounty offer in a blockchain message and has already returned some 8.9 million of the stolen assets to victims, which is quite ironic because we were just talking about Curve before and how the founder did all these OTC deals.

Now that the OTC deals are done and he's raised 40-something million, the hacker is starting to return the funds. So he's returned how much out of how much? So the total hack was about $60 million. And in a message linked to Ethereum blockchain, the looter asked Alchemix, one of the victims of the heist, to confirm the protocol's address so that they could return the assets.

Soon after, they transferred 4,820 Ethereum, some $8.9 million worth to Alchemix's multi-sig wallet. Interesting. And just before we go back to the ETF discussion, Scott, just one more thing I'll add. We found, I can't remember what case it was, but even if a hacker returns some of the funds, it doesn't mean you're not going to be

facing any criminal war. Mango markets. Once we commit the crime, there's no going back. Let's go back to that after we finish here with with eric because i would love to hear his perspective uh yeah no james um who i in in this in this case he's batman i think i'll be robin when it comes to crypto uh but um listen um he nailed everything i would uh reiterate that the ether futures ETFs, I'm actually a little more optimistic than he is, simply because I'll be honest, we've heard directly from issuers who are in contact with the SEC that it's happening.

So also, the Wall Street Journal reported this and the Wall Street Journal is a little more conservative when it comes to publishing stuff like this. So they must have got some really good information. And they were basically saying that they're considering it. So again, not to say it's 100% in the bag, but based on those sources, I'm a little more confident than 75%. We didn't have as strong of sources back in 2021 with the Bitcoin futures. And we were 75%. We had some back channel. In the Ether case, and we were 75%. We had some back channel.

In the Ether case, this has been really good. Now the spot case, which is their holy grail, Ether futures ETFs are not going to take in a ton of money. I would say maybe a couple hundred million. That's my guess. I could be wrong. And same with the spot, the futures Bitcoin ETFs. They've only have a billion or so.

The real holy grail is the spot. And that's where we're at 65%. And this is an interesting, I've always told people, I kind of feel like Jim Garrison in the movie JFK, where there's all this circumstantial evidence that Lee Harvey Oswald didn't act alone. And the whole movie is about him taking in back channel sources, trying to read the tea leaves. And you can tell something is going on, but you're still not totally sure. There's no like hard evidence yet. But we, again, what we're hearing is pretty good. And we also feel like, again, there's also a little bit of like the winds of change are definitely blowing. You can feel it, But the bigger, bigger issue and the reason we've really banked a lot of

our odds on BlackRock. BlackRock is the biggest asset manager in the world. Larry Fink is highly connected, not messing around. And I think between that and the Grayscale suit, especially if they lose, those are strong things. Those are strong forces out out there and James mentioned some of the other ones in terms of us trying to read Gensler's language or some language in the filings all the legal stuff in my opinion is important

but honestly it just comes down to the political aspect probably is Gensler going to feel like this is a politically better decision versus not and we think the winds are going to blow enough where it'd be politically untenable for him, especially with the pressure from BlackRock again, who was a big company connected to the government. So like I said, it might not happen. You know, we have 35% chance it won't obviously, but that's where we're at with the spot. And to me, that's the main attraction.

That's the headliner. I think the ether futures is like a an undercard but you know it's like a opening act you never heard of versus the headliner which is the spot race uh because that is uh people people have shown that the advisor world they just not going to use futures uh they they want they want it physically backed whether that's gold or silver uh the spot will it'll end up being like 99% of the assets versus maybe 1% for the futures at the end of the day or five years from now. Yeah, I mean the futures ETF hasn't performed as well. It doesn't perform as well as the spot ETF. Questions? Do you really think Gary Gensler cares? It feels like he's got – He's on to AI now. Now he's on to AI.

Yeah, but I mean, do you... You know, like, that's... The head of the SEC is a role that people complain about. I mean, I remember we used to complain about Jay Clay in the same way that... Not in the same way, not as aggressively as we complain about Gary Gensler. But, you know, he knows he's got Elizabeth Warren behind him

and Elizabeth Warren's got a lot of power on the left side. The question is, do you think Gary Gensler. But, you know, he knows he's got Elizabeth Warren behind him, and Elizabeth Warren's got a lot of power on the left side. The question is, do you think Gary Gensler really cares? Well, this is part of the political aspect. You know, his bosses, right? If they're going to, you know, be influenced by BlackRock in any way, that matters. If there are some of them defecting, that matters. And that's again, why that side of it is just as important as the legal analysis of like what an SSA is and all that stuff. But at the end of the day,

I think Gary and the SEC will, they'll just break the language legally that it fits what they want to say. So if they want to approve it, they'll say, well, the SSA fits our thing. If they don't want to approve it, they'll move the goalposts again. So again, this is why I think the political aspect is, is almost more important to watch. But this is stuff we don't, we're not privy to these conversations. So again, we sort of have to get some information where we can get it, talk to people. But that's, I think, where you'd have him shift. But again, the Ether futures is a policy shift. They have frequently rejected these up until this year. So the fact that they're going to shift on

these tells you they can shift. And the fact they lost to the Spikes futures case tells you they can shift and the fact they lost to the spikes futures case tells you they can lose in court again that the two of the three judges were on that case so the sec in my opinion uh maybe they just feel a little weakened uh you can just again the ether futures i think is proof that things can change um so um that's that's where the optimism comes from but again the pessimism comes from all the things he said in the past. Eric, I want to take a step back. Can you explain to the audience and to me really, why is the ETH futures ETF such an important thing?

Or is it important? What does it mean for ETH and altcoins? I think it was Ran that mentioned that could trigger an altcoin bull run. So could it impact altcoins the same way a Bitcoin spot ETF could impact crypto and Bitcoin? I'll say one thing and pass it to James. Look, again, we don't think Ether futures ETFs will get that much in assets. If we're talking about a couple hundred million, and what is the total market cap of Ether, right? Isn't it like 300 billion or something? So it would be a small sliver.

It would just impact the margins, in my opinion. But again, the reason, the Ether futures ETF to me are, it's more important as a symbolic step that the SEC can change policy. It's just another step on the road to this sort of opening up to this. So I'll let James comment on maybe the more nuts and bolts when it comes to altcoins and how this would affect it. Yeah, and while you're doing that, James, I'm just going through the audience questions and I'm not seeing, going through their comments.

By the way, guys, we go through comments throughout every space. But it just, so that's another one here is asking, let's get the update on the NFT market if the ETH futures ETF gets approved. And I just think people are looking for something to kind of bring hope back into the industry,

especially altcoins and NFTs. And what you're saying, James, is that guys don't get too excited. Sorry, it's you, Eric. Guys, don't get too excited. This is not going to lead to a massive bull run in altcoins and NFTs in the ecosystem, but it is symbolically a step in the right direction.

Is that fair, Eric, before we go to James? Yeah, absolutely. Again, the Bitcoin futures ETFs, and that's Bitcoin, only has a billion. So if you sort of maybe extrapolate Ether in the same, you know, is a, what is it, a third of the market cap Bitcoin? I don't know, I'm just guessing.

It might have a third of that billion. So, you know, three, $400 million. That just is probably what's likely going to happen. Again, because you have to understand that when you look at ETF owner, like who owns ETFs? 70 to 75% of ETF users are advisors. Advisors control $30 trillion of like rich people's money, right? They don't like futures.

They don't like derivatives. They feel like a's etf is like contaminated spot they'll use and so it's that's why the ether futures again they're going to come with these derivatives which are like repellent to advisor so you won't get the big chunk of money to even consider it really in my opinion james i would love your stance before we we kind of move on to the next topic. For people that are trying to look at this as like their blue star for the next bull run and that the end is over, that's not it, correct? Yeah, no, I wouldn't say that either.

I would agree with pretty much, I do agree with everything that Eric just said. I mean, the other thing I would point out is if you look at when Bitcoin Futures ETFs launched, it was the end of October would point out is if you look at what Bitcoin futures ETFs launched, it was the end of October in 2021. And if you know what happened within the months afterwards, that was definitely not starting a bull run, if anything, it ended it. So obviously, we're in a different, very different area right now with ETH futures. But again, Eric said there's not going to be a ton of interest. These types of products, these futures products, they're good trading

vehicles, right? If you want to trade exposure to ETH or trade exposure to Bitcoin, they make a lot of sense. But advisors and people who want to hold this for the long term or invest for the long term, they prefer the physically backed stuff. That's what the data shows unequivocally. So that's basically how we're looking at it, why we're more interested in the Bitcoin spot race. But as Eric said, this is an SEC pivot. And I kind of hinted at this when I was talking earlier. The SEC has always kind of put Bitcoin on a pedestal, right? It's the one thing it would say is not a security. It's one thing it would say is a commodity. And then they always talk about all these other altcoins and they refuse to really say anything truly about ETH. And to me, if they actually approve these ETH futures ETFs,

it's signaling to me that maybe Gensler and the SEC are kind of basically pushing ETH and Bitcoin to one side and then everything else to the other side. So that's basically the way I'm viewing this and watching to see if anything changes. Scott? I was going to say, great.

I think, yeah, I think we've talked to the ETF through, and I think that we're all generally optimistic, and I don't think we can get any better takes than from anyone, from Eric and James. Guys, you said 65% chance that the Bitcoin spot ETF this year. Oh, Bitcoin, yeah.

Sorry, I thought I heard ETH. Yeah, I think 65 was James. You said 65. Eric, what was your number 7. This year. Oh, Bitcoin. Yeah, Bitcoin. Sorry, I thought I heard ETH. Yeah, I think 65 was James. You said 65. Eric, what was your number? Between this year. No, spot. Yes, it's for this year. Spot, Bitcoin, James and I are totally aligned at 65.

We talk about this every day. The Ether futures, I'm just a little more aggressive probably because the two people contacted me directly. I just think, you know, they're basically saying, and the Wall Street Journal, so I'd go a little higher. No, I think Ryan was excited about the Bitcoin ETF.

I remember last time you guys were 50-50. I'm more excited about the time periods. I'm trying to understand. You say this year. They've got so much time. You've got so much time and the SEC had really no incentive

to rush this. Why wouldn't they just wait until they were completely out of time? They might. As we get into next year, our odds would go up. What are your odds? 65 for this year and let's end it with what are your odds for next year?

I mean, we haven't really we're trying to keep it to this year just to keep one number out there, but James can comment after me. But I would probably go up a little bit because we're going to have due dates coming next year. But then again – Could it hit as high as 80 or is it too high? By the end of 2024? Correct.

Yeah. Oh, wow. I would probably go to 80. Nice. What do you think, James? Yeah, I don't think that's out of the question. I mean, the key fact here is, right, there's two things to watch, right? What happens in the Grayscale decision?

And after the Grayscale decision comes out, at some point, we don't know, in the next month, the worst-case scenario could come out sometime in December, we're thinking. But so the SEC will have a certain time period after that to respond, right? Say 45 days, and they can issue an an appeal and we can figure out from there. I personally think that after that happens, they're not just going to come up with a new decision for Grayscale and then not act on all these other applications. So I think once they decide what they're going to do, assuming they lose the case to Grayscale, they will probably apply it to all of them. That said, ARK and 21 shares, their application is due January 10th.

And if that application doesn't get approved, I would find it hard to believe that the SEC would deny them on January 10th and then approve BlackRock and everyone else in March. So January 10th would be the last date. This is good news to me, especially comparing last time you guys were here. Scott, I know you want to move on to Coinbase. Mr. Melker. pairing last time you guys were here scott i know you want to move on to to coinbase mr melker i'm here my mic is just uh my buttons sometimes stop working on this new x app for whatever reason yeah so obviously coinbase base is sort of the big news obviously at the moment with the launch coming next week we had all the insanity around the bald pump and dump, I guess we'll call it, meme token before the base chain was even able to be bridged off of back to Ethereum. And I know we have a lot of guests here who want to talk about what's happening with base and Coinbase. And of course, in the midst of all this, we had Coinbase earnings yesterday right after market.

Coinbase was up 12 percent. Then it was down an hour later, unbelievably, another 13 percent from there and down on the day and then opened just slightly up, I think, and roughly even. But a lot going on with Coinbase right now. I think that Wall Street expected them to wildly underperform. And the very fact that they overperformed was big news for them. And now we obviously have base launching next week. I know we have quite a few guests here that are probably much more well versed in what's happening with base than I am. So kind of open the floor. I know Westy, Patrick, you guys are have been tracking this pretty closely. Maybe, Patrick, do you want to tell us why any of this matters right now with base

launching next week? Yeah week yeah sure so for people who aren't familiar at all with what base is it's coinbase's new layer 2 that's built on the op stack and basically that's an ethereum scaling solution so any app that you can deploy on ethereum you'll be able to deploy on base but it will be cheaper and faster and it's getting a lot of attention i think because the hope is that coinbase can onboard some of their however many hundred million users into actually using on-chain applications using base. And if you look at what happened with Binance Smart Chain, it was one of the top performing ecosystems of the last cycle, still is one of the largest ecosystems in crypto, and that's largely because it's backed by Binance. So there's

a lot of anticipation that similar thing could happen with base chain. And in the chain hasn't officially launched yet. But some people found a bridge that was intended for developers over the weekend. And just to give you a sense of the hype around it. With that bridge, which was really just a smart contract, and there was no way to bridge back, over $40 million of ETH was sent to the chain over the weekend. So a bunch of degenerates wanted to go pump and dump on a chain that wasn't even live yet. Fun. Yeah, great. Exactly. And with no way to bridge off. With no way to bridge off. That's ridiculous. So in the words of the Hex supporters, they sacrificed. Just two quick questions.

First, why do we need another layer two? And second, why do you think Coinbase waited so long for this? Well, I think I wouldn't say they waited that long because I think that it's actually an opportune time to launch it because you, of course, had to have the tech stack they're building on the op stack mature you have this year layer twos have gotten a lot of

attention uh and as far as needing another one um i think it kind of remains to be seen what unique angle coinbase will bring to the space because we of course have arbitrum we have optimism we have polygon uh which are already offering their own Layer 2s. Can I jump in here? Yeah, go ahead. I think one of the things that people are not getting about Coinbase is, if you look at a blockchain, you need users and you need technology. Now, from a technology base, they've used Optimism, the OP stack, which is pretty tested technology when it comes to an ETH layer two. I think the part that's exciting about this is it's a tokenless layer two. So it doesn't rely on a token. And as a result, it is a layer two, which is maybe more compliant in terms

of, you know, global compliance. It's like, hey, it's a layer two. It works like a blockchain. It is a blockchain, but it doesn't have its own token. Number two, and maybe as a result of that, you've got Coinbase saying that it basically brings its user base with the on-ramps and off-ramps that Coinbase has got. So you've almost got a layer two with on-ramps and off-ramps, which in this current guy is more regulatory friendly because they have a token.

So I think that that's the part that the differentiation between like optimism, arbitramatic or polygon is that, you know, base doesn't have a token. They say that it won't have a token. They say they won't have a token. I believe that at some stage in the future

when tokens become much more acceptable by regulators, Coinbase will do it. And Base has on-ramps and off-ramps for millions of retail consumers. And so now if you build a dApp on Base, all of a sudden you can pay in cash for your transactions. You can pay in USD for your transactions.

It's very similar. It's easy for companies to understand how it works. And've got on ramps and off ramps so who do you think will be the first early adopters of base excluding the fucking meme coins i think what we're going to get is we're going to get a huge migration of people from current daps and you're already starting to see a whole of current daps deploying their tokens on base because they can they're saying to themselves, great, if I can attract the Coinbase on-ramp and off-ramp, Coinbase

customer base, then that's a great USP that actually no one else has. And do you think the regulatory clarity that Coinbase has and the fact they don't have a token gives that peace of mind for anyone that migrates to base as well?

Look, I think so. I think so. And I think there's still a couple of years of regulatory unclarity. I mean, I know that Coinbase today filed a motion to dismiss the SEC's case. I read the whole motion. It's pretty compelling, but I don't think it's going to make the motion go away. I think it's just a tactic, to be honest. So I think this token, is it a security, isn't it a security,

is going to take three years at least to sort out in the United States. And I think until then, you know, if you want to get a head start and you're involved on a blockchain that is backed by Coinbase pretty openly, has the on-ramps and off-ramps and user bases of Coinbase, I think that's a USP that will really, really, really get traction. I think it's one of the smartest things to happen to crypto. Why? Because it's going to bring in people that ordinarily wouldn't have come into blockchain

because they couldn't. You think about a big US corporation trying to launch a DApp or an application on a blockchain and they don't know how to deal with tokens on their balance sheet and paying in tokens and are they actually holding securities and are they dealing securities? Yeah, this is a tokenless environment and you actually pay with money. So yeah, Patrick, I see your hand, so I'd love to hear your view here. Yeah, and Patrick, I want to add a question to it before you add your views. I want to to ask a question like is there any downsides to not having a token at this stage yeah well so i guess first to address the question the downside

of not having a token is that you don't attract the crypto native users who are hoping to get some sort of airdrop or who are looking for incentives but that's also potentially a positive because it means that that they can get accurate user metrics and that they can build things that are actually contributing real real economic value and business on chain rather than wondering how many of their hundred thousand users are going to leave as soon as they do an airdrop but one thing i wanted to add was um i think the trust like ran said is a huge factor and that's just why even within people who are crypto native and have a higher risk tolerance i don't think normally if a chain launched, you'd see people sending $40 million in a few days without any way to bridge off. That just shows that people assume Coinbase is well

trusted. They've been around for a while. They're a publicly traded US company. You can be pretty sure that the chain's going to still be up and running. You'll be able to withdraw. and then the other thing i wanted to add was to give some color to just how many people are trying to launch things on there since coinbase made their official announcement about the bridge there's already been 15 different decentralized exchanges have launched on the chain 15 that's crazy how does that compare to other uh other other layer twos and other chains that launched the amount of interest that we have now in the midst of a bear market patrick before we go to How does that compare to other layer twos or other chains that launched? The amount of interest that we have now in the midst of a bear market. Patrick, before we go to Jay and other speakers.

Yeah, I mean, it's still much smaller, for example, than Arbitrum and Optimism, but it's been less than a week. But for a launch or even pre-launch, the amount of interest, how does it compare to other hyped up layers? Oh, it's it's uh significantly more i mean to give it in perspective with yeah i'm looking at i'm actually looking at the numbers here on um on an optimist and if you i mean you obviously can't share the chart but if you look at the chart of transactions and wallet stuff like that it's it's it's unbelievable actually yeah so to put it to put in perspective they have about half as many um protocols as polygon zk evm after two days polygon zk evm evm has been around for a couple months let me let me get some other perspectives on this maybe

there's a more bearish perspective as we do this i want everyone in the audience go on your phone for a second it's for your own good and there's $8 million in prizes being given away by crypto, by, sorry, Bybit. I've pinned a tweet above. So if you want to join our little trading team that's been acquired by Crypto Banter, if you want to join the trading team that we have and win up to $8 million in prizes,

check out the pinned tweet above. Go into the link and good luck winning some money. I want to go back. You're downplaying how good it is we're the biggest I'm keeping it casual just like people

flow into it biggest team in the world we're the biggest team in the world statistically if you've got the most players

you've got the highest chances of winning if we win we give back the total winnings to the teams hold on

if we win do we just get 8 million dollars and then we can give it away to the teams to the communities hold on is it is it if we win do we just get eight million dollars and then we can give it away to the to the players there is a way i'm not sure exactly how it's split but it's split in such a way that the winners get some but the winning team gets some and what we what we get we give back straight straight back yeah we don't we don't get we don't get anything as us like we just give everything to the players yeah yeah exactly everything and we should just yeah we gotta give to the players yeah but i mean like the eight million dollars if we win as in as in we as in our team if our team wins do we get the eight million dollars for our team or split there's like first

prize second prize third prize there i think that i think it's split against a couple of teams but i think it's a it's uh uh we get the whole thing oh okay that sucks um all right let's go to jay and westy guys uh is there anyone and then we'll go to Hitesh afterwards. But just want to get some more perspectives on base and how exciting it is. And maybe you can relate it to the projects and investors in the audience as well. What does that mean for projects?

What does it mean for investors? And what can we expect? Yeah, just lots of great points already made. I think just to add, following their earnings call yesterday, I think there's particular emphasis on new crypto use cases. And one thing that comes to mind around base is payments. I think what L2s enable is cheaper, faster, more scalable transactions.

And we have to keep in mind that Coinbase has a decent stake in Circle and USDC. And I think with the latest decline, you know, post-USDC DPEG, there's definitely emphasis to bring that up, given that it's such a big portion of Coinbase's subscription and services revenue. And I think one of the great use cases here is enabling payments and working with more traditional, you know, corporate entities to integrate payments via the BaseL2 blockchain and incorporating USDC into that. Westy? Yeah, I would love to make some points here

on the questions you asked earlier as well. So yeah, one of the reasons why Base is such a huge deal and why we quote-unquote need another Layer 2 is because of that tie to coinbase where there's you know they have millions of users already using their platform and all it takes is a simple front end for anyone to go from how many but how many ways but how many how many users does bnb have for example or other layers like we talk about by a coinbase having that many users but what percentage of those users do you think will will will care about this difference on chain my difference is that that bnp is not officially integrated into

binance and a binance customer cannot seamlessly transfer money oh so the onboarding process from coinbase to base makes it really enticing and what he's saying is that projects would find it enticing to move to base is they'll get access to coinbase's direct users the way coin view this is that they're going to at some point make no differentiation between the centralized exchange users and the base users so it's almost like if you think about the same set of users which can use i or that's kind of like how you have to think about it and they're having the foresight to disrupt their own business before somebody else can come in and disrupt it Which I find very compelling Exactly and this doesn't never does also doesn't take away from how many users B&B chain has which is

I don't know I don't know if you're if you're with it. hear us? I don't know if you're with the... Yeah, it seems you're with the dolphin right now, the one in your photo. Your audio is really bad, bro. So maybe I'll give you 30, 60 seconds to fix it and I'll give you the mic right after Westy. But if you can fix your audio, that would be great.

Let's move away a bit from the dolphins. Sorry, Westy, go ahead and we'll go to Hitesh. Absolutely. So because of these users, a lot of developers are planning to port their applications from Ethereum and Layer 2. Yeah. So am I audible now? Yeah, Hitesh. Can you hear? Hold on. This is funny. Hitesh, can you hear Westy speak? Okay. Sorry.

All good. Now, maybe I thought I'm not putting you on the spot. Sometimes there's a glitch where one speaker can't hear other speakers. So it's not your fault. All good, Westy. I'll let you finish, and then we'll go to Hitesh. Go ahead, Wesley. Yeah, sorry. So, yeah, a lot of applications we're planning to port over, and as a result, a lot of users sort of want to run that flow. And so that's why we saw a lot of activity. I think it's also important to note that RAN brought up

sort of regulatory capture with not having a token. I do think, you know know that doesn't necessarily clear them they're still operating a centralized sequencer which could be seen as a money transmitter as well as the fact that they decided to make their l2 permissionless allowing anyone to build any application and any user to use it so we may see some activity that you know is not very good from an optic standpoint maybe we see you know someone from north a north korean wallet start to use the chain and that's obviously not a good look so i don't know necessarily uh they're in the clear from a regulatory standpoint but it definitely does help um and then finally i think

it's important to note like how important this is or could be for coinbase going forward let's see let's see i just i just got word that hith is actually bearish on Base, Westy. So what I want to do is I want to give the mic to Hitesh just to know, because I love different perspectives and it seems everyone is becoming a bit of a pro-Base circle jerk, including me. I'm just so bullish on it. So Hitesh, maybe you can try to convince us

and then we still have Westy, Jay and Patrick here. Convince us, why do you think BASE is not as exciting as what everyone's making it out to be? Actually, I was bullish on Coinbase. I was bullish on BASE. I'm not bearish on BASE. I was trying to point out the reasons why BASE could be a successful launch

in the near future. Because there are many L2s out there. A lot of superchains will be launched the same OP stake. So it's a very competitive market. So that is why I'm thinking on a use case perspective here. So like Coinbase has a couple of different advantages here. One major advantage they have is they are focusing on Coinbase payment.

So Coinbase payment is one of the major use case which can be explored in the near future. We will take the recent example of Genosys Pay. So Genosys Pay have recently launched a credit card. Hitesh, your mic, man. It's not perfect. I don't know why. It's not perfect, man. Sorry, bro. I don't want to pop your bubble.

But now I know that Hitesh is joining everyone's circle jerk of being bullish on base. Anyone here, speak up now. Anyone here is not as bullish on base and why they think base could potentially flop. Jay, are you that man? Yeah, yeah. I can definitely steal this. I'll go to you.

We'll go. Yeah, Willie, I'll go quickly. Yeah, Willie, I'm just going to go to Jay and I'll go to you right after, sir. Jay, give us your shot. Tell us why. Yeah, go ahead, bro. The other side, I think one of the things we've seen is even with the emphasis on L2 scaling solutions, I don't think we're quite there as far as transaction costs, transaction fees go. I think when we saw the arbitrum airdrop go, you know, gas fees on the L2 were still $20, $30 per transaction, which is, it's a lot better than, you know, the peak ETH L1 gas fees, but it's not sustainable as far as bringing the non-crypto native, the non-whales

onto base L2. I think there are a lot of upgrades that do come around to address this issue like EIP-4844, but those are definitely still a work in progress and a ways away before we can really see the progress as far as lower transaction fees. So I think that's one of the big sticking points, which is the L2 narrative has been very hyped up, but I don't think the expectations meet reality right now as far as getting us to 100 million users or 10 million users simultaneously. That's also true of L1s, right, Jay? Oh, it definitely is.

But I think you have chains like Solana where you have subcent transactions right now that do sustain significantly higher TPS. There's obviously the argument around decentralization and the other properties that ETH and some of the L2s come with. But effectively, we're operating on a trade-off where one of the axes is price expensive versus cheap, and the other axis is decentralization, security,

and whatever else comes with the Ethereum and older chain or chains that have been around for longer William I'd love to get your thoughts on this before Scott gives us the finale yes thanks for your two things that haven't been talked about too much one watch for their cloud services. They have something called Wallet as a Service, A-S. That's of the Coinbase-based launch that allows dApps to create very easily wallets in a hybrid type of scenario. The second thing somebody said,

what apps are going to come, what's going to come to base? Look for apps that are really for the end user as a Web to kind of apps to make it easier blackbird Blackbird dot XYZ and they've been talked about there are a loyalty app for restaurants Look for that. Well, thanks, William.

And yeah, I think this is William's internet's cutting out. Hitesh has a mic with a dolphin. And everyone seems to love bass. That's the conclusion that I got, Scott. What's your thoughts on everything we heard? Yeah, I think that's basically the summary. Ran, go ahead. I saw Ran lift his mic, but then he disappeared.

And then David Silva will tell us why Binance is going to get legally crushed, why XRP's... David, your stance on XRP was pretty bearish, but it kind of flipped. But then the hex is dead. David, give us your update on all the legal action we've seen from the SEC and from the DOJ recently. It would be a good way to wrap up the space on a somber note. No. I kept waiting to see something intelligent and knowing something I'm talking about.

And I just can say from… I gave you an easy one, David. I gave you an easy one. Tell us what Binance has crushed. XRP has crushed, everyone is crushed, and Hex is gone. That was a massive softball. Massive softball. So I think that the interesting thing that's happening here is we haven't seen the DOJ come out yet with anything criminal still. And I keep saying this, whether it's days, weeks, or a couple of months.

All these issues are going to collide at some point. And I do think that there's going to be, you know, I think some of I think the journalists when Eric was speaking before about like odds of approval, we're going to see a collision between old school crypto criminality charges, and what's going on today. And it's going to be interesting to see what impact that has. So if we see, you know, the rumors earlier this week about DOJ being concerned about there being a bank run on Binance if they announce criminal charges, one, if there's a one-to-one asset ratio, that shouldn't be a problem. And two, DOJ is not concerned if making criminal charges, if they have the ability to stick those charges. I mean, there's a reason why. So David, this statement really confused me because I've asked a few people, they said the DOJ doesn't usually say those things. And let me,

tell me if this is true, because like, what's the point? Why would they be concerned? An exchange should hold assets one-to-one. So either there's nefarious reasons they said that or potentially Binance does not have one-to-one backing of assets, Binance or other exchanges, and that's why they're concerned. The statement is very odd. It was incredibly odd. And you've got to remember, it's not like the quotes are not coming direct. It was whispers. It was, you know, the DOJ is concerned about this. There's no way the DOJ is concerned about this.

So it's fake news? No, what's the source? What's the – hold on. This is easy, bro. What's the source of these whispers? Well, the source started by a – I'm not going to say an unworthworthy news site. But then it got picked up quoting the underlying source yeah yeah so i don't believe i don't believe it but it got mainstream attention

but at the end of the day it's it's the modern world someone says something on twitter then the then the tweet itself tell me about tell me about it yeah exactly how. It becomes like this. You know, the snowballing cartoon. It's like a little tiny ball. And then it says, oh, okay, this is nothing. And then somehow someone just twists it a bit. Another one twists it again. And it becomes this massive ball and it starts to spread on social media.

Is that what we saw? But then, so the source, do you know what that news website is that had that initial statement? I want to say it was like SEMA or something who had the original quote, and then SEMA got picked up, and then it just- SEMA 4, which is, by the way, largely partly owned by SBF. This is mental. Okay, so hold on. Did SEMA 4 mention the source of that quote or no?

Or is that one of those anonymous sources that we cannot reveal their identity yeah just like just like by the way we saw news from the financial times earlier this week that coinbase had been told by the sec to delist other everything other than bitcoin and then a day later both the sec and coinbase denied that i saw okay so i saw that and i was wondering i don't know how to bring it up like an idiot i saw that i. I'm like, why are we talking about this? Why isn't it on the agenda? So that was dismissive bullshit. Yeah, Brian Armstrong literally had to come back and walk back to the comment

because it would have been – if he was telling the truth, it would have been really bad. Hold on, hold on. So what do you mean Brian Armstrong walked back to comment? The comment wasn't made by Brian, was it? No, but Brian had to address it because it's not all out of control. And Coinbase had to come back and everyone had to say, no, this is not what happened here. Because again, a whisper turned into a rumor, a rumor turned into a hill, and the hill turned into a mountain. And these guys have such strong arguments. Look, Coinbase filed a motion to dismiss today. It's as exciting as every defense lawyer wants it to be.

It says everything that, you know, everyone on this space wants to hear. And all I keep saying all morning is, does anyone want to take a bet that it's not going to, it looks good, it sounds good, but it's not going to be a winning argument? You know, a lot of the things that happened this week, you know, I call it with what happened with Ripple, we call it the Torres Doctrine now. And everybody wants to follow the Torres Doctrine in crypto. But the rake-off analysis out of New York, it's not a doctrine yet because it was on motion to dismiss.

He took a big swing, you know, and did a big favor for the SEC in their fight against, you know, crypto and exchanges. I didn't think that the Ripple case was going to get an interlocutory appeal, meaning they were allowed to cut short and run quicker to the appeals court. But Rakoff did a big favor by questioning the Torres doctrine about whether it's going to stand or not. Rakoff is very, very respected across everywhere. And it's going to be good for the SEC to now go appeal that decision quicker, faster, and have some, you know,

conservative old people who continue to support the SEC, like myself, who believe they're more likely to win. So this is like, we've always, this is for for the audience we've been saying for years we need regulatory clarity we need regulators to be more clear and tell us what can and cannot be done well guys in a democracy like the u.s this is what regulatory clarity looks like just a whole bunch of power struggles with a bit of a sprinkle of corruption and a lot of back and forth and money wasted so we are getting regulatory clarity If you don't like the process, well, this is what we've asked for. It's not gonna be as clear as like,

ah, this is it. These are the rules and enjoy. But we're getting it. And I think once we get through it over the next couple of years, the ecosystem will be very, very different. But to me, that all sounds very bullish. And we've got David and others

that will keep coming on stage and trying to explain to us everything that's happening behind the scenes. But i want to get dave's final thoughts while waiting for dave before giving the mic to dave i mean anyone that wants to come on the show as a sponsor um you know today this week sponsors by bit we've got a couple of sponsors next week um and we have a shark tank show that we're doing we're pretty excited about it um if you want to come on and pitch your project just dm me or dm ran i should probably pin the tweets where you can email us as well so i'll do that as

dave speaks but if you do want to come on the show um with us just hit us up via dms um or email us on the tweet that's going to be pinned above shortly also hey it's come up i don't know who brought it up but that ugly logo is up on stage the crypto town hall so make sure you follow that ugly red logo on stage because that's where we're going to start hosting shows it's some time in the next 10 years it's a little less ugly now i like this one it's just okay so the red circle on stage make sure you follow that because sometime in the next 10 20 years it seems we're going to start hosting shows from that account so make sure you follow that account dave want to get your final thoughts before we all wrap it up. Yeah, I mean, there's three topics working backwards.

The reason that one might be concerned about Binance Bank Run has nothing to do with Spot. Well, maybe it has something to do with Spot, but it's much more likely derivatives. To put it in perspective, they have $10 billion in open interest reported on their derivatives exchanges. And whatever insurance fund one might have in case of a mass liquidation event, there's risk there. It's interesting because Binance has 10 billion in open interest and supposedly 25 billion in trading volume. Whereas you look at Bybit, your sponsor, they have 5 billion in open interest and 5 billion in trading volume, or five and a half and five which is, you know, makes me think that the volume on Bybit is more real, you know, to use put in quotes, but still, derivatives do have significant risk to the

exchange in a mass market move. If there is bankrupt, if people are forced to liquidate, so that's what the issue is there. If you work backwards to the Bitcoin ETF thing, the only point I'll make is that Gensler could credibly claim a win if he approves the spot Bitcoin ETF now, because by his own admission, he has no other way to regulate Bitcoin spot. And at least this way, the SEC has a leg or has a skin in the game in terms of regulating if in fact the Coinbase is required to file suspicious activity reports and the s with the sec which seems to be the case under the surveillance sharing agreement uh and if we go back to one more question the other topic the

topic of of the curve hack the point that i made and scott sort of made it but i think it's it's really clear i think you're going to see DeFi protocols start to embrace haircuts on collateral. Now, that sounds very dry and bullshit. But what it means is rigorous, programmatic liquidity qualification for taking collateral. So, you know, I actually did, you know, did the math, you know, when this all happened. And effectively, $10 million of curve had as much market impact as a hundred million, you know, after it, because of the big bids out there, but it was a 57% drop just to clear 10 million in volume on the official order books on centralized exchanges. Whereas the same amount

in ether was less than half a percent. So, you know, treating them the collateral, the same is insane. Uh, and honestly, you're going to see DeFi protocols start to wise up to that. And so I think that's the healing that will happen. And that will be really, really positive because that's what's necessary. I think that may be. And how is it? How is it? How will the healing process?

Very briefly, because we do want to end the show. But how will that healing process look like? Is it going to be a lot of blood before we heal? Or is it going to be a slow process moving forward? Not necessarily. I think you're going to see innovations in DeFi protocols where they're going to use, whether it's liquidity oracles or data such as we have at CoinRoute, I don't really care, but there is the ability to measure liquidity. And if you do that and you not just have blanket 150% collateral, but know 150 collateral or even 125 but adjusted for available liquidity you can make the protocol safe against even the kinds of

situation that just happened and i think that people will start to innovate and do that just stay tuned all right well scott ran any final words uh before we go off into the is today friday yeah before we go off into the weekend is today Friday? Yeah, before we go off into the weekend. I think that's pretty much it, unless you're going to cut me off. Ran, no, no, no. I think that summarized the week. I won't, bro. I'll stop doing it.

I'll stop doing it. This was a wild week, man, just an absolutely wild week. Maybe it's a symptom of the fact that we had so much serious news. Why is it wild? Why is it wild? What's the serious news? We had Richard Hart sued by the SEC and all the nonsense about that.

We had this curve thing. We had a rug pull pump and dump on a chain that shouldn't even be accessible. That was linked to SBF and Alameda. So yeah, I would say that we had a bit of a week. Hold on. What's linked to... Oh, you're talking about that coin?

That was bald. We talked about that. Bald. Yeah, yeah, yeah. Of course, of course. That was on base? That was on base. Yes.

Yes. Welcome to the show, Mario. No, no, no. I didn't know it was on base. But two seconds. And I know there's been claims that that was SPF and there's like a couple of threads.

Did you look at the evidence? Did it look credible that it could really be Alameda or spf no because i have all of my mental faculties together and don't waste my time on stupidity so you don't think it's spf it's just no i don't think it's spf the guy is like has a spotlight on it and it doesn't have internet or phone access but i like how pretty much every single bad thing is happening in crypto for the past year has just been behind spf is like behind it everyone's been blaming spf i i if we can find a way to blame it on him i'm happy to do it because do you do you think but the oh yeah

didn't we have didn't we have also one of the charges dropped on spf was that this week or last week i think that i don't even i think it was at the tail end of last week that the campaign finance charges were dropped and of course that that sent everyone into a tailspin saying that he'll get off, which I don't think he will. No, no, no. There's seven charges left, seven charges left. But the markets have been relatively steady. Pretty boring, yeah?

Yeah, I think it's boring. And so we made up a whole bunch of things to get really emotional about on crypto Twitter, which was all those things I just named. And every week, you can't have BlackRock filing for an ETF. Ran? I'm here, bro. I'm here. I agree with everything that Scott said.

Cool. There you go. Guys, enjoy your weekend, everyone. Thanks for coming by and we'll see you again on Monday at 10am, 10.15am EST. Bye, everyone.