The Wolf Of All Streets - U.S. Gov Goes ALL IN On Crypto! Game Changer Or Power Grab? | Friday Five

Episode Date: August 29, 2025

The U.S. is stepping deeper into crypto and markets are feeling it. Powell’s Jackson Hole speech warned against cutting rates too soon, while Trump’s move to oust Fed Governor Lisa Cook sparked a legal fight over Fed independence. At the same time, the Commerce Department is publishing GDP data on-chain through Chainlink, and Google Cloud unveiled a new blockchain (GCUL) for institutions. Banks are lobbying against stablecoins, the U.S. is taking a 10% stake in Intel but not Nvidia, and Bitcoin faces pressure as transaction fees hit their lowest since 2011 and a whale dumped 24,000 BTC, driving the price below $110K.

The United States government is going all in on crypto, specifically on blockchain technology, all at the same time as the Trump family is going all in on crypto. We have a lot to talk about here on the Friday 5 with NLW live from Vegas. Let's go. what is up everybody good morning and welcome to the friday five your weekly dose of highlights from crypto and macro news if you like this show you should like the channel and also subscribe and what i like is getting this guy up at six o'clock in the morning in los vegas that's commitment you know not this week nothing like uh nothing like the the you actually you actually

having like the silent alarm going you wake up 602 you're like you know what let's let's look rock and roll so here we are you're like it's fine man I the good thing is that you actually are waking up and not waiting to do the show to go to sleep because that's what I was done in my 20s in Vegas oh my god yeah there's there's a big big difference between every time I come to Vegas there's a there's a chasm between the way that I did Vegas the time before it yeah now you just like catch a nice show and a dinner yeah I know how it is now yeah well anyways you're just probably not talk about Vegas, which, by the way, is apparently completely dead and is an indication of a failing economy, but we won't go there. We've first got the United States government

and their new commitment to utilizing blockchain technology. Here we go. U.S. puts GDP data on the blockchain in Trump crypto push. This is obviously Lutnik and the Department of Commerce and saying that they're going to basically use chain link to bring data onto the blockchain, on, I think it was eight public blockchains. First, this was reported as a chain link story. Then Pith Network said they were involved. And then Coinbase said they were involved and that they listed all these chains. What's going on here?

How privileged are we that we can quibble about whether a story about the U.S. government adopting blockchain in some way actually matters at all? Because by and large, I think my response to the story and I think lots of people's response to the story was like, whatever, that's cute. You know, it's like, this doesn't really seem to solve the issues of GDP and blah, blah, blah, blah. But then you like halt the brakes. You backpedal a little bit. And when you think about whether it's just the sort of taking outside of the context of whatever cynical response we might have to sort of broader issues going on as relates to, you know, numbers and the way that the economy is reported, it's a profound and cool step, if nothing else, for the government to be.

exploring ways to take the immutability of blockchains and apply it to, you know, to government data. So I think on the one hand, I find myself, you know, being grizzled and cynical and just sort of not caring about these sort of things. But at the same time, I think, again, if you can take that step back, it's just, it's very cool, right? This is not some grand transformational thing and relative to the a million things that have gone on with this administration when you know the history of books are written it'll be fairly low right this is a tiny little footnote but the fact that this is the type of thing that we now get as a footnote i think is in and of itself telling yeah but the most important question here that we haven't asked is which

of my bags is going to pump because of this news all of them of course okay good so as long as all my bags are going to pump it'll be big news if none of my bags pump in the next 24 hours this forgotten. You know, look, the the question of whether blockchains have real utility does remain and lurk for some people in some sections of some markets. And things like this where, again, you can quibble about which problems, you know, a given approach might solve. But it's the U.S. government saying this is actually useful for X, Y, Z reasons. And, you know, we're going to take the time to go through with it. That's a cool thing. Yeah. So speaking of the government and adoption, we not only have the government adopting blockchain, we also have the government adopting socialism

and taking free stakes in large companies. Intel gets $5.7 billion from Trump deal as White House says details are being ironed out. Effectively, we have Trump organized Trump and the United States government criticizing Intel saying what a dumbass their CEO was. Well, now they got 10% for free. He's no longer a dumbass and they're likely to get all the big government contracts. And oh, by the way, Besson rules out a U.S. stake in NVIDIA after Intel deal. We're not going to take all the companies, just this way. Yeah. This one has been funny because you have, you know, the second that someone tries to say,

oh, well, there's specifics here that make it, you know, maybe not as applicable to the slippery slope style arguments that you might think, then Trump comes out and is like, yeah, we want to do this for all the companies, you know. Look, I think that we, there's a few different things going on here. One, the administration was always going to play by its own set of rules. You know, frankly, like, people voted for them to throw out the traditional playbook and throw out the traditional playbook they certainly have. Two, there's clearly an interest. Trump doesn't see the same separation between the business private sector and the government sector when he's in the government sector because his natural home is in the private sector.

And I think that if you are being generous and not just sort of trying to paint a narrative of sort of the loss of independence of the private sector, I think that he often operates just like it's all sort of the place that he's playing in and he gets to play in all the spheres. It's not like some grand, I mean, at least I don't believe it, you know, whatever. People can have different opinions about this. But I don't think there's some grand idea to make, you know, the government to some socialist collective. I think that there are very meaningful questions around the way that markets function. Very, very meaningful questions. And I am glad that people want to have that conversation. I think squawking and just throwing around whatever big word we think is likely to get us the most attention is unlikely to be the right path. I do think the fact that the senators who are lining up against this are sort of libertarians and the senators who like it are Bernie Sanders,

is an interesting reflection of what it means. But when push comes to shove, when it comes to this particular question, Intel specifically, there is a lot underneath here that is much more specific to Intel and to the chip industry and to semiconductor manufacturing

than this would be if he was, you know, I don't know, whatever, taking 10% of Mattel or Hasbro or something like that. Yeah, I mean, there's a, much to unpack here. I actually see both sides of this argument, to be quite frank. I wasn't totally opposed to the idea of a sovereign wealth fund when they floated it, but I didn't know that it would necessarily be stakes in individual companies that would obviously influence the way that the United States picks winners. So it's very not free market, obviously, to do that this.

The flip side is that we're giving a bunch of companies a lot of money anyways in grants. So why shouldn't the United States and its citizens benefit from that. So I guess I see that side of the argument. There's just literally no way that you have free fair market competition if the United States government has a stake in seeing a winner. Yeah. So for me, I don't even think the grant thing I actually think is that's for me more and still the column of bad reasoning for this particular issue. I think I'm not opposed to the idea that there are ways for the U.S. government to invest in mission, you know, sort of, you know, industries or specific businesses that have critical national security dimensions to them. I don't think that retroactively saying that because

we gave you grants that we're supposed to be one thing, and you get this other thing. Like that, that strikes me as problematic. I was more in a vacuum there. I was more in a vacuum. Yeah. Yeah. If we're going to give you money in the future. Totally. Totally. No, there's there's, there's no reason a priori that if a government, you know, if the government decides that an industry is, is mission critical, you know, to the proper functioning and national security of the country that it shouldn't benefit in the upside, especially when there's such incredible wealth creation there. But I think that, again, coming back to,

for people who are not spending a lot of time with it around AI and just sort of advanced computing in general, we do not have the capacity to make chips. Invidia does not make its own chips. It is reliant on TSM, which is 80 miles off the coast of China. And Intel is for better or worse, the only company that even sort of has the capability to produce these things, you can't, if you let Intel fail right now, which would be completely reasonable and it absolutely deserves to, basically without question, it's a terrible company, like just absolutely awful has bungled and has been for a while. But it's not like the latest why Combinator startup can just start a chip foundry and make it work in the next couple of years. you know so i i think that there are like again real real very specific questions here that uh that

make it a little bit different than um some other examples but again you know the the the man in the white house never never makes things easy and clear by just saying that it's i want to take a stake in every company this is fun yeah i was trying to just play devil's advocate for the case of the show and you shot me down anyways but uh to be clear where i stand bad yeah yeah i saw i saw your initial No, you're good. But other things I think are bad are this. Trump Media firm raises $6.4 billion to invest in Crypto.com's digital token deal includes purchase of Trump's stock.

There's so much here to unpack. There's obviously crypto.com's token chronos, which you may remember already was the topic of major controversy a few months ago because they'd apparently burnt a huge percentage of the supply a few years ago, which is what drove so much interest in the token. And then they said, just kidding, and they brought them back as a marketing budget, or at least proposed to. I don't know exactly what happened. But in a world where we're seeing the biggest institutions in crypto talking about $1 billion raises and $1.2 billion raises for Solana and Ethereum treasury companies slide way down the risk curve to a much lower market cap asset like Kronos and Trump media, not World Liberty Financial, Trump media throwing $6.4 billion to buy this token. I'm going to go on record and say, I think it's unlikely that they did major due diligence of the entire crypto market and we're like, you need $6.4 billion in Kronos. That's the one. That's the coin. We need a treasury in.

Look, as someone who worked inside FTX and sat on my perch looking over at crypto.com, just waiting for like the clear mafia front or whatever the hell that company must actually be to fail. only to have it be my thing that was actually a fraud without realizing it. They've still got the arena, right? Uh-huh. Or at least they did recently. I'm just saying. I've still never met someone who actually uses Crypto.com.

It's been like eight years or something like that in this industry. Look, I don't know. I think a whole hold aside bad at apologies crypto.com. I'm sure you're doing great stuff. I'm sorry. Look, this is, this is obviously, man, And like, this is the type of thing that I think, uh, we are doing a lot of holding our nose

and dealing with because it feels like the cost of doing business with this particular administration that is so clearly a net negative for everyone in this industry, uh, you know, whatever. I, I think you can call it like you see it. And, you know, this is the, this is sort of the, the, the piece of the pie that we just wish wouldn't, wouldn't happen. But it's, it is, it is what it is. It's kind of all I can come back to. I don't know. I think everything that you said is correct. Like the difference in scale just seems absurd. The, you know, I mean, this is we are writing all of the Democrats midterm campaigns for them. But then again, maybe it's going to be a losing strategy once more to attack crypto because it's such an abstract, you know, impersonal issue. So maybe

it's a 5D chess move. Pretty upset because I was feeling like crypto.com has an arena. They do F1. They're literally everywhere, and they were probably looking at the Friday 5 next as a big sponsorship opportunity. I know nothing about them, to be honest. Yeah. Yeah, Matt Damon is. Yeah, that's right. That was crypto.com with the boats and stuff. It was.

Yeah, you were there for the Larry, the what's his face, the Kirby enthusiasm era of FDA. That was the man, look back at that super. one Super Bowl and where we were at in crypto, man. What a time to be alive. If anyone wants a retrospective on that, like two or three Sundays ago, there was an op-ed that came out that was basically like about how crypto marketing had lost the plot and sort of it got into the FTX era. And I spent about 20 minutes articulating exactly what our strategy was. So if you're interested, it's there. Perfect. And Trump hasn't stopped at taking control of financial markets, both crypto and corporates.

It's also firing off Fed government governors. Trump faces key legal tests and effort to exert control over federal reserve. Fed governor Lisa Cook is seek a temporary restraining order against the president's attempt to fire her. I'm going to be honest. I saw this one and I chose to just not read it all week. Yeah. This is one of those. I was like, I could dig into this or I can just, uh, forget that this ever happened.

Yeah. It's very, very reasonable approach, especially because when it comes to the specifics, this is going to be an endless battle. You know, Lisa Cook is not, it doesn't appear going to sort of like go off quietly and, you know, and just sort of accept the punishment being doled out for it's going to be a battle. I think what's interesting to me, as I, you know, I have been observing more the market's response to this story than the story itself. And, you know, it's, it's dangerous, I think, to overcall shifts in sentiment and shifts in in the narrative. But I do think the combination of discourse around this Intel thing, plus all of the sort of the administration's

conversations around it, plus this specific firing of, you know, this Fed official has, for many people tip them over from the questions that we have about the White House's intervention in private markets are lurking in something in the future to they're real, they're here right now. You had a former Fed governor who had written an op-ed like three or four weeks ago basically being like, chill out, don't worry. Trump's actual ambitions as relates to Fed independents probably aren't that bad, who then came back out and wrote another op-ed and was like, whoops, just kidding, we should be worried now. And there's a lot of that happening on, you know, Fin twit and places like that. So again, it feels to me like the combination of recent

moves have certainly ratcheted up the concern among some parts of sort of the financial analyst and financial commentary market around just how willing to intervene in in sort of, you know, non-government or non-white House at least functions of the market this, this White House is willing to be. And yet another beautiful segue. Speaking of places that they're trying to intervene in markets, it's obviously not just at that side of the Fed, but we've got Jerome Powell given his speech, who we know that Trump wants to fire, had the greatest memeable event of all time when he went and looked at his building. But we had a Jackson Hole last week, the Super Bowl of Monetary Policy, where the world watches one old man for which way he's going to cough, sneeze, or hiccup to see which way we're headed with financial markets. And he gave a speech.

And I still can't get consensus on whether it was doveish, hawkish, or what it meant for future rates, because people are so divided on literally everything. Yeah. Yeah, it was, boy, even for a man who has specialized in saying nothing with a lot of words throughout his tenure, this one said a lot with no words. I mean, to some extent, it is like the final triumph of Powell from a speaking perspective that it is just fully a Roershack test for whatever you want to say with an ever so slight perhaps head nod towards what the market wanted to hear.

sufficient for them to take and run with it as though it was exactly what they wanted to hear. You know, for anyone, we talked about this a little bit last week, whether there was going to be fireworks, you know, and him just burning the house to the ground on the way out. This was a very tired public official on their way out the door with the flu, barely able to get through the speech, miss speaking at key parts and having to have the transcript correct them. This was not a firebrand speech by any stretch of the imagination. Look, for markets, they heard that Powell was, you know, saying that we are potentially in a place to consider a change in policy direction. Now, again, there's about 18 paragraphs around it that are caveats and provisos about, you know, why things could be looking at in multiple different directions.

But, you know, I think that a lot of us had our odds on betting was for him trying to give himself more flexibility to not cut by being. hawkish. And so the fact that simply the fact that there was an absence of that I think was the signal that the markets took and ran with. But yeah, I literally had earlier in the week done a retrospective of each of his previous, you know, Jackson Hole speeches. And this one for my money was the one that was the least clear on what the hell he was actually trying to say and get to. This is stayed consistent for his final speech. It's perfectly in character. You got to give them credit. I mean, meanwhile, by the way, core inflation rose to 2.9% in July, highest since February. This just came out for those who were waiting at 830 this morning.

This is PCE, personal consumption expenditure, basically slightly up since June, but in line. So we're not seeing markets probably get rocked by this because it's somewhat what was expected. But this is the Fed's favored inflation gauge for their rate decision. So it'll be interesting to see throughout the day how people interpret the likelihood that we now get rate cuts or don't based on this. Yep. Yeah. I think it's very clear that the market has a ton of anxiety right now.

And, you know, it has, it has for, I mean, really since the rate hiking cycle started, had this lurking fear that even when things are nominally on paper going well in aggregate, that it's two house of cardsy for their liking. And you see this manifest every time, you know, AI anything wobble. This week, in fact, probably the most interesting signal for people who are trying to get a sense of where the market's attitudes really are is that the NVIDIA earnings report has become the new Rorschach test, you know, the new version of the Fed, you know, Fed announcements. And, you know, Nvidia was up 56% year over year, but it still fell, you know, 5% in immediate aftermarket trading because of the guidance that it wasn't going to continue to grow 200% and. like it had before. And, you know, it's, it's clear that we're in sort of the very late cycle, low liquidity environment. People really aren't as much as they tried to interpret Powell's

speech as Dovish, super convicted in how Dovish he was. You know, it's really wait and see. The markets really want rate cuts. There's all these things that make them want to believe that that's what they're going to get. And of course, there's the background thing behind it, which is like, are those really the solve to all of our problems anyways? So, you know, I think that we're just going to be living in a period of sort of heightened anxiety, I think, in markets until at the very least the September Fed meeting. And I don't really see a way around it. Yeah, fall is going to be fun.

So moving on, we got U.S. banks lobby to block stable coin interests of her fears of deposit flight. This is really interesting, actually, because when the Genius Act was being discussed, this was the main point of contention between the industry and the government. The crypto industry saying we want yield on stable coins. That was where legislators basically drew the line, even those who are likely the most favorable for stable coin legislation. Apparently there are a whole bunch of loopholes in the legislation that allows people to earn yield on stable coins anyways.

And now the banks are freaking out because they know that if you can earn a yield on a stable coin, you hold in your own wallet that's better than the non-interest rate you get from a bank who you have to trust, then they might absolutely be screwed. We saw the first iterations of this, actually, a few weeks ago when Citadel came out and said, hey, you guys need to slow your role on this Genius Act stuff. But now you have the biggest bank lobbies in the world freaking out because stable coins could end them. Bro, the banks are such whiners. I mean, we knew this, but good Lord.

Like, they cry more petulantly than any industry. Like, sorry, guess what? You've got competition here. You don't have a regulatory moat in the same way you used to. There are new products that are competing for people's attention. Go build stuff, man. Do you know how slow people change? The idea that the banks are going to sit there and just spend the next couple years,

you know, screaming and hollering about what crypto-native institutions can and can't do, as opposed to just build updated products, consumers are not en masse going out surveying where they're going to get the best yield for their, you know, copious deposits that aren't being used day to day to make them survive. Yeah. Nerd wallet. It's at best, a tiny fraction of them go to nerd wallet. Most of them, you know, are like, it's just, it's just such a, such a, you know, whatever. I mean, obviously, I'm biased towards a more entrepreneurial kind of, you know, build it kind of mindset, which I think a lot of people who are in crypto find themselves in, even if they're not necessarily coming from tech. It's an industry that has,

attracted people who are focused on competition and like free markets and all these sort of things. So I think it's particularly galling to see banks try to exert this sort of playbook to keep their position. But it's very clear, I think this is whatever, look, my theory on this or my belief on this is that whatever victories the banks can win, and they will win some in the short term for sure. I mean, even the fact that the genius act is written as it was, they are going to survive or not based on how they compete with changing times. And all you need to do is look at the banks who are getting right on board with this. And instead of spending a bunch of time on these types of efforts are instead lining up partners and trying to figure out how they get a piece

of the action. But there are really meaningful questions here and a lot of battles to be had because part of the thing that happened with the Genius Act was that we just simply kicked the can down the road on a lot of the amendments that people wanted to put. So there was an amendment debate, basically it all moved to the Market Structure Act. So there are these big unresolved questions that are going to change the nature of that particular fight. And so I think a lot of what you're seeing is not just scuttlebutt around the specific implementation of the Genius Act, the potential loopholes they're in, but also sort of a proxy for the larger battles coming as Congress comes back in a session around the market structure bill, which is sort of now the recipient of

all of these conversations that didn't get finished when it came to the Genius Act. So I know we're kind of hitting our normal time. We have a few stories left. We'll cook through them. Google Cloud is developing its own blockchain for payments currently in private test. This is wild. We saw the Circle announcement recently and Stripe had an announcement recently. Taking a little bit off the shine of your favorite token is going to go up because institutions are going to adopt that network for what they're building. Yeah. You know, look, everyone's going to, everyone's going to try and build their own thing. How long it lasts. We've seen this story before. I think there's reason to be skeptical. But if you want to take a positive or sort of optimistic

view of this, Google only does things because they think there's really interesting economic activity and they think it's good for them. So this is not a, this is not a story that's like just trying to jump on a trend for headlines. It's them, you know, looking to participate in this space. So again, maybe we, we quibble around the efficacy of sort of the balkanized public or private chain world that, you know, seems to be coming back around again. But it is, I think, an indicator of broadly speaking where things are going that, you know, the behemoth that is Google is interested in, again, in this big way. A hundred percent. And this is a story that's been unpacked all week, but still, I think, kind of one of the bigger stories of the week was that we had the

Bitcoin dump last week on a Sunday because somebody sold 24,000 Bitcoin into thin liquidity on a weekend. And this really being pointed to for the reason we kind of started trading down here around 110,000 where we're sitting right now. I mean, any new and unique thoughts on this one? No. To me, I thought that the best take on this, the one that, like, you know, again, you're not going to be able to apply this to everyone. But Checkmate, formerly of GlassNode, who obviously does on-chain data, said, what this means is Bitcoin demand has, oh, no, sorry, that's the wrong tweet. Anyways, he said something basically that's like, this isn't complicated guys. You know, a couple of years ago, Bitcoin whales were looking at, you know, the threat that their, you know, main asset could

be seized and forfeit from an unfriendly government. And now we're in the place. that we are, by and large, if you want an explanation for whale selling, it's that they can finally a state plan and do all the things that they haven't been able to do for a decade, and that's as simple as that. And I think that, you know, broadly speaking, that's sort of where I am with all of the whale selling. I think in each particular case, there are plenty of things that contravene that if you go look at sort of specific examples. But I don't know, I think that we will look back at this period of whale selling in this sort of favorable early days of this administration as just a very kind of a one-time, you know, in retrospect, inevitable sort

of distribution. I think the other thing is, again, if you're zooming out far enough, you need as Bitcoin becomes more a bigger part of the global system, you have to have whales redistribute some of their stack. Otherwise, it's going to be hugely problematic, right? If everyone is accumulating just like Sailor, there's very little supply to go around. So there's reasons to be glad, even if not in the short term for our bags, that there's some amount of whale redistribution happening. But none of those stories ultimately, you know, freak me out all that much in the context of just sort of the very natural human need to diversify and get some liquidity. Yeah, I mean, listen, Price is still down now. But if you remember what actually happened on

Sunday was price went down $4,000 in a few minutes and bounced all the way back up. So if you were looking at it in real time. Actually, the market on a Sunday in low liquidity had enough demand to absorb 24,000 Bitcoin and selling and bounce right back and only be down a couple percent on the day. That's the bigger story, I think, if you were actually watching it in real time. Yeah, I think he's a great point. So I'm going to let you go back to sleep after your long night at Marquis. I know that you were clubbing until you came to this show. You know, Omnia here at the, here at Caesar's Palace. Just never open your mouth in the pools.

Like, don't let any of that water ever. There was this study on it, man, it's the dirtiest place on earth. You'd rather literally like drink the Ganges than the Encore Beach Club swimming pool. There's weird signs around how, you know, you're not supposed to go in the pool if you have, you know, Giardia. It's like, well, thank you. That was a sure. If you have a paper cut, avoid this pool like the plague because you might actually get it. All right, guys, NLW is amazing.

check the breakdown let the guy go back to sleep we'll see you next week thanks later guys