Unchained - Can a DeFi Smart Contract Be Regulated? Two CFTC Commissioners Discuss - Ep.260

Episode Date: August 3, 2021

CFTC Commissioners Dan Berkovitz and Brian Quintenz discuss the difficulties of regulating crypto derivatives and DeFi. Show highlights: their backgrounds what the CFTC’s duties are regarding crypto how the CFTC’s jurisdiction has evolved over the years why Commissioner Quintenz believes SEC Commissioner Hester Peirce’s safe harbor proposal is “brilliant” what relationship the CFTC and SEC have when making decisions on crypto assets why the commissioners believe CFTC’s complaints regarding BitMEX are “well-founded” why formal regulation for crypto derivatives is unlikely to be produced by the CFTC why leveraged derivatives products are a “concern” to the CFTC what makes regulating DeFi platforms so difficult when it comes to DeFi, who is a natural entity for the CFTC to regulate, if any whether the CFTC would ever go after DeFi "market participants," who the CFTC also regulates why smart contracts involving futures could be illegal  how the possibility that smart contracts could be illegal squares with the view that software development is a form of free speech  whether the CFTC could prosecute developers who write smart contracts whether the CFTC needs to re-write its laws in light of DeFi innovation why Commissioner Berkovitz thinks the DeFi “winners” will be protocols that focus on meeting regulatory requirements why the CFTC approved Bitcoin futures in 2017 while the SEC has not yet approved a Bitcoin ETF how a Bitcoin ETF could solve Bitcoin’s accounting issue, which currently gives companies no upside for adding BTC to its balance sheet   Thank you to our sponsors! Crypto.com: https://crypto.onelink.me/J9Lg/unchainedcardearnfeb2  Tezos: https://tezos.com/discover?utm_source=laura-shin&utm_medium=podcast-sponsorship-unconfirmed&utm_campaign=tezos-campaign&utm_content=hero  Conjure: https://conjure.finance    Episode Links   People Dan Berkovitz, CFTC Commissioner (Sep 2018+) CFTC website: https://www.cftc.gov/About/Commissioners/CommissionerDanMBerkovitz/index.htm Twitter: https://twitter.com/CFTCberkovitz  Brian Quintenz, CFTC Commissioner (Aug 2017+) CFTC website: https://www.cftc.gov/About/Commissioners/BrianQuintenz/index.htm Twitter: https://twitter.com/CFTCquintenz    Related Links CFTC digital asset resources: https://www.cftc.gov/digitalassets/index.htm Commissioner Berkovitz DeFi speech: https://www.theblockcrypto.com/linked/107769/cftc-commissioner-criticizes-defi-decries-lack-of-intermediaries Commissioner Quintenz smart contracts/blockchain speech: https://www.cftc.gov/PressRoom/SpeechesTestimony/opaquintenz16 CFTC jurisdiction over digital assets: https://www.cftc.gov/PressRoom/SpeechesTestimony/giancarlostatement010418  CFTC BitMEX complaint: https://www.cftc.gov/PressRoom/PressReleases/8270-20 FTX and Binance remove high leverage: https://decrypt.co/76858/ftx-and-binance-remove-high-leverage-from-exchanges SEC Commissioner Hester Peirce’s safe harbor proposal: https://www.sec.gov/news/public-statement/peirce-statement-token-safe-harbor-proposal-2.0  Bitcoin futures approval from CFTC in 2017: https://www.businessinsider.com/bitcoin-price-futures-trading-exchanges-cftc-2017-12 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hi, everyone. Welcome to Unchained. You're a no-hype resource for all things Crypto. I'm your host, Laura Shin, a journalist with over two decades of experience. I started covering crypto six years ago, and as the senior editor at Forbes was the first mainstream media reporter to cover cryptocurrency full-time. This is the August 3rd, 2021 episode of Unchained. My book, The Cryptopians, Idealism, Greed, lies in the making of the first big cryptocurrency craze is available for pre-order on Amazon, Barnes & Noble, bookshop or any of your favorite bookstores. Go to Bitley slash Cryptopians. That's vit.l.ly slash C-R-Y-P-T-O-P-I-A-N-S and pre-order today. The Crypto.com app lets you buy, earn, and spend crypto all in one place. Earn up to 8.5% interest on your Bitcoin and 14% interest on your stable coins. Paid weekly. Download the Crypta.comcom app and get $25 with the code, Laura. The link is in the description. TASOS is smart money that's redefining what it means to hold an exchange value in a digitally connected world.

Discover how people are reimagining the world around you on TASOS. Conjure brings any asset you want onto Ethereum by allowing for users to create synthetic assets which track other markets. With zero interest loans and unlimited assets, it's helping defy to consume tradfi. That's C-O-N-J-U-R-E dot finance. Check it out. Today's guests are CFTC Commissioner as Dan B. Berkowitz and Brian Quintenz. Welcome, Commissioner's Berkowitz and Quintens. Thanks, Laura.

Great to be with you. Pleasure to be here. Let's start with each of you giving your background, including your experience with and knowledge of crypto. And Commissioner Berkowitz, why don't we start with you? Thank you, Laura. My involvement in commodity markets and things commodities started when I was counsel to the Senate permanent subcommittee on investigations.

This was in the 2000s, and at that time, there was a lot of volatility. and things going on in the energy markets, energy commodity markets, oil, natural gas, that Senator I worked for, Senator Carr 11, was interested in getting to the bottom of. There was a lot of price volatility, and oil prices ended up peaking at $147 a barrel in 2008. After I worked for the Senate, I had the privilege of being General Counsel of the Commodity Futures Trading Commission during the Dodd-Frank years, when the Dodd-Frank Act was passed by the Congress, regulating the swaps markets, and the next several years, the CFTC passed many regulations implementing that law. I was then in private practice for a number of years, and in 2018,

I had the privilege of being appointed by the president to one of the seats on the CFTC. appointed by President Trump as one of the Democratic commissioners on the CFTC. Cryptocurrency has been an increasing field since the early 2010s is when I think I became first aware of it. But in the last few years, there's been a huge explosion of interest and breadth in these markets and eager to talk about those today. Thank you. And Commissioner Quintens. Yeah, thanks, Lord. It's great to be with you.

always great to be with my fellow commissioner, esteemed colleague, Dan Berkowitz. I don't have nearly the distinguished background that Dan does, and I mean that very seriously as a brilliant lawyer and a wonderful addition to the commission since I've been there. And I'm not an attorney, and that's actually, I think, more rare than I would like it, but certainly more rare than has been the case

that you might expect for a market's regulator over the last number of years. I started off my career on Capitol Hill, and worked for a member of Congress from Columbus, Ohio, where I'm from originally for about six and a half years, and then decided to career switch and got an MBA and decided to go into the markets where I joined an investment firm that was focused on the banking sector during the financial crisis. So it was kind of trial by fire, you know, right off the bat, but I learned how to to the best that I could, and I think to the best that anyone can evaluate some of the largest and most

complex financial institutions in the world. While that was going on, I did see the evolution of cryptocurrencies. I saw them, you know, come into the marketplace in the early 2010s. I think it's an important point to note that they did come into the marketplace on the heels of the financial crisis, given the centralization, you know, of that, of the stresses in the marketplace, you know, that led to that crisis. Following my time at the investment firm, I formed my own investment management company where I was involved in trading commodity derivatives on behalf of clients. And I was interviewed and asked to join the commission in

2015, was nominated by both President Obama and by President Trump, and ultimately joined the commission in August of 2017. The second part, it was about cryptocurrencies, I think, from the commission's perspective, when I was preparing for the, this role in 2015, 2016. Obviously, I had a familiarity with Bitcoin and some of the developments in crypto. But it wasn't really front and center. I think Dodd-Frank was front and center in terms of how the CFTC was addressing, implementing rules to address the last crisis.

But very quickly after I joined the commission, we were presented with two exchanges that wanted to list Bitcoin futures contracts. And I think that put the agency head first and front and center. in the cryptocurrency environment. Yeah, and to your point earlier about how Bitcoin was born during the financial crisis, famously the Genesis block of the Bitcoin blockchain does reference headline from the Times of London about a third bank bailout. So clearly, you know, that was on Satoshi's mind.

So for the rest of the conversation, let's just make sure that all the listeners have the lay of the land here. Can one of you describe what it is that the CFTC's duties are when it comes to crypto or what its purview is? And maybe we'll start with you, Commissioner Quintenz. Sure. So the CFTC has a very broad authority over derivatives products, derivatives on commodities, on commodities, on broad-based securities.

and, you know, the evolution of the markets that we regulate really formed in the 1800s and was formed without regulation, and it was centered around hedging activity and risk transfer activity. And the core of those markets were the agricultural markets. They were corn, wheat, soybeans. And as risk management tools like futures contracts evolved to allow the participants in those markets, the growers, the producers, the processors to trade off their risks so that they wouldn't go under if they had a bad crop or if the prices inflated way too much for them to afford and not risk manage their business. Eventually, the federal government decided to get more involved in regulating how those contracts were listed, who and how could

participate and how they could participate. And ultimately, in the 1970s, the CFTC was created to supervise derivatives markets activity. As our authorities relate more directly to crypto assets themselves, we do have very broad-based anti-fraud and anti-manipulation authority over commodity transactions generally. I think we usually try to exercise that authority in very limited circumstances where we see overt fraud or where we see a significant amount of manipulation. manipulation that is very directly tied to the futures contracts and the derivatives markets

that we regulate upon which risk managers really rely. And Commissioner Berkowitz? Thank you, Laura. And I would agree with everything that Commissioner Quintends. He's commissioner provided an excellent summary of the evolution of the commodity markets and the reason for their existence. So I just want to put up a finer point on several of the things that Commission. or contends mentioned. First, as the markets evolved from agricultural commodities,

which they were from the late 19th century until basically around the 1970s, but in the 1970s with the oil embargo and coming off the gold standard, they're developed financial commodities. And so a commodity doesn't have to be a tangible commodity such as gold or oil or wheat or corn. A commodity under the 1974 law, which created the CFDC, can be an intangible. It can be an interest rate. It can be a stock index or it can be a cryptocurrency. Commodity under the Commodity Exchange Act is basically anything you can have a futures contract on currently or potentially in the future. So we've had several test cases recently about cryptocurrency and there's futures contracts on Bitcoin.

So cryptocurrency, therefore, is a commodity. Now, excluded from our jurisdiction as commodities is securities. So the SEC has jurisdiction over securities and we have jurisdiction over commodities, but commodities a very broad category can be tangible or intangible. The instruments involving commodities that we specifically regulate are futures, contracts for future delivery, their swats, and their options on commodities. So all of those instruments have to be traded on regulated exchanges. For a futures contract, it has to be on what we call a designated contract market,

but that's basically a futures exchange. Swaps have to be traded either on a swap execution facility or a designated contract market if they reach a sufficient amount of liquidity in the market. If you're a retail person, you have to trade a swap on a futures exchange, basically. the only place a retail person could be able to trade a swap. And as Commissioner Quintends mentioned, in addition to our regulatory authority, we regulate these facilities for the trading of futures or we regulate the trading of swaps. We regulated swaps are intermediaries, such as big banks who are swap dealers.

We also have anti-fraud and anti-manipulation authority. We can prosecute persons who commit fraud or manipulation in the spot or cash market on any exchange. Even if we don't regulate a spot exchange, we can prosecute persons who manipulate those markets. So we have both regulatory jurisdiction over derivative execution facilities, how they're executed, but we also have this anti-fraud and anti-manipulation authority over the commodity transactions themselves. And so I'm glad that you brought up the SEC because I believe that in the crypto space that CC right now, and for a while

actually, has been kind of the big regulator that everybody talks about. And as you mentioned, kind of what tends to not fall in the SECs bucket will fall into the CFTCs. And there was a period when, and this is just one example where, for instance, people were concerned

that ether could be a security because of how it was sold in a crowd sale. But eventually the SEC said it was not. Later, the CFTC also said that it was commodity. And I think people are curious how that decision making happened. At that time, is that something that the two agencies discussed actively together to make the determination together? And just in general, how do the CFTC and SEC work when it comes to matters

involving crypto? Yeah, I'll take a first stab at that, Dan. I think, yes, there is a lot of interaction between the agencies when it comes to the legal status of any specific product. I think we see that on the enforcement side. If we see fraud of, you know, around a particular crypto asset, the agencies have to make a determination about which agency has authority. And then they look at the specifics of that asset to make that determination so that the right appropriate agency takes the lead. I do think I wasn't involved in any discussions between the agencies around the status of Bitcoin. or Ether and whether or not they were securities.

But the chair of the CFTC at the time, Heath Harbert, did come out and say it was a commodity. I think that implied that Ether was not a security and that it was within the CFTC's jurisdiction, should Futures Contracts or Juridus Contracts be listed upon it. But I do think that there should be more transparency around those kinds of decisions. there should be more official analysis that's provided to the public. I think that the limbo that a lot of the community finds themselves in is not productive to innovation. And I think that there is a very clear path forward towards providing that clarity. And I would hope that our counterparts of the SEC seriously consider that.

And when you say that what would be that clear path forward? Well, I think Hester Purr's safe harbor proposal is a brilliant proposal. So I think there is an opinion within the CFTC that products can evolve from an initial securities offering into a commodity. They can become commoditized through, you know, widespread acceptance and utility that moves something beyond, you know, the ownership and control, you know, of a common enterprise. And I think that a safe harbor-like proposal can take advantage of that, of that, of that, legal theory and not unduly limit the ability of entrepreneurs and innovators to, you know, to take advantage of the blockchain space and the development and the crypto assets. I think the challenge is that if you, you know, rigidly applied securities laws to crypto assets

that started off as securities, you may prevent them from evolving into commodities. So some level of a safe harbor, I think, makes a lot of sense. and besides Commissioner Purs, I've yet to hear a lot of additional support from the SEC on that kind of concept, but I think it's an important one. And Commissioner Berkovits, what do you think of the Safe Harbor proposal? Well, I think we actually have an excellent working relationship with the SEC, and that's improved over the years, and a large amount of improvements due to Commissioner Quintan. I mean, Commissioner Quintends has been a point person for us on our relations with the SEC

and helping along with the chairman of the CFTC and the chairman of the CFTC and the chairman of the SEC working together. And so our relations are very good. But fundamentally, each agency in the end, we will consult and we will discuss these issues, but fundamentally each agency is charged by Congress with protecting the markets under its jurisdiction. So in terms of what is a security or what is a commodity, our lawyers will discuss with their lawyers and we have discussions. But at the end of the day, it's up to each agency to decide what's in its jurisdiction and enforce the laws that it's charged with enforcing.

So the SEC will determine what's a security at the end of the day. And if it's a security, it's in their jurisdiction. I totally agree that with what Commissioner Comptan said, about an instrument can change its nature depending on the use as it evolves. So in terms of really whether the SEC should grant a safe harbor or something in terms of securities law, I mean, I would defer to the SEC on that because they're really primarily charged with enforcing the securities laws. Once it comes over on the commodity side, you know, we have our legal. requirements. And if people believe that there's a way that the current regulations may or may not be suited to their particular structure, people come in and as they typically do and say, well, here's why the CFDC's regulations in our specific case should not apply. And we'll,

we'll listen to their arguments and make a determination of potentially where we can do various things. We can grant in some instances what we call no action relief on a trial basis, say, okay, if you can't comply this way, you can comply that way. And we'll have a number of conditions and say, okay, if you can't meet the regulatory requirement or it's inappropriate for you to meet it by doing XYZ, we'll allow you to ABC, provided you do D, E, and F also and give us assurance that the intent of the regulation is being met. And we, you know, we issue, let's say, 100-something, no action letters a year with various entities. coming in or potentially people can petition for a change in woolmaking, which admittedly is

harder. So we do have some flexibility and we exercise that flexibility, you know, numerous times each year. So it's not, it's not, our regulatory structure is not so rigid that we demand everybody do everything in a cookie cutter approach. At this point, maybe it's perhaps worthwhile to mention overarching our regulatory philosophy is what we call principles-based. The statute says, here are the principles and here are the standards that we expect UCFTC to hold the market participants to. And it's called principles-based regulation, the statute. For example, a future exchange.

There's, I think it's about 20, what we call core principles. The futures exchange, it has to be able to ensure that there's not manipulation. You have to post the prices. You have to ensure the financial integrity of transactions. You have to be able to operate your facility and have redundancy. So if there's a storm and there's an outage or a disruption, you can continue operations. You have to be secure against cyber threats. These general objectives, and we fill in a lot of the details on that and say, here's how to do it.

But fundamentally, you know, there's those 20 principles you have to meet. And we give the exchanges considerable leeway. and how they meet it. Now, there are sometimes we do get very specific. It's, we say, thou must doubt do X in certain circumstances. But it's really a principles-based approach. So if entities in the marketplace seeking additional flexibility as to different ways to meet the regulations, our system and our regulatory structure can accommodate that.

So earlier you talked about how the focus at the CFTC has been on fraud and other kinds of, obvious bad behavior. There was a civil case that the CFTC brought against BitMex and its owners. And at the same time, the Department of Justice also brought a criminal case against them for violating and conspiring to violate the Bank Secrecy Act by willfully failing to establish, implement, and maintain an adequate anti-money laundering program. And each count carries a maximum penalty of five years in prison. And there are some legal observers who say that these charges are unprecedented since there aren't allegations of specific criminal activity such as fraud or credit card theft or terrorist financing. And they compare this to some cases where banks admitted,

such as HSPC, admitted to actual money laundering and the Justice Department did not indict the bank rights officials. So, you know, I think some crypto observers do believe that this case shows a double standard. What is your take on that? The Bitmex case is being prosecuted by several agencies. The CFTC, we have a complaint regarding violations of the Commodity Exchange Act as well as the Bank Secrecy Act, civil violations. So we prosecute the civil violations. And with respect to BitMex, the complaint lays out a number of issues selling swaps without

registering as a swap execution facility, selling. providing leverage for transactions without registering as a futures commission merchant, trading futures contracts without registering as a designated contract market or a futures exchange and violations of the civil violations of the Bank Secrecy Act. And so we laid out the facts in the complaint and obviously a stand by the complaint that we issued as a well-founded complaint. In terms of the criminal prosecution, that's up to really the Department of Justice and whether it meets the standards for criminal prosecution. So, I mean, I believe the Department of Justice has an extreme amount of integrity in their prosecutions and that it meets the appropriate standards for bringing a criminal prosecution.

So there's, I believe, all the actions that the federal government in this matter have brought are well-founded. Commissioner Quintens? Yeah, I can't talk about the Bitmex case specifically. But I think it's important to contrast what a centralized entity that is seeking to list products that are directly in the commission's jurisdiction. And doing that in a way that contravenes or completely ignores our rules. for, you know, entities engaged in that kind of behavior with what we're seeing in the DFI space, where protocols, you know, through decentralization are offering, you know, innovation and opportunities outside of an intermediated, you know, functional marketplace.

That is a new paradigm of a market that our law and our rules were not designed to comprehend. And so I view them as somewhat different, and maybe we'll, you know, explore some of this. But I think in cases like the one you mentioned, there is a centralized entity that flaunted our rules, benefited themselves in doing so. And I think it's reasonable to expect that in doing, in accessing U.S. customers, I think the agency has, you know, a lot of jurisdiction to bring a case there. And so we will get in a defy. There's so much to discuss there. But before we move on to that, I do want to ask a little bit more about derivatives

because that is what was offered on Bitmax. And it's just one of the most popular areas of crypto. And also, it's a very popular financial instrument in the traditional financial world. And in the U.S. derivatives are regulated by the CFTC, but there's no formal regulatory framework for crypto derivatives. exchanges. So when could we expect such rules and regulations from the CFTC and what would that framework look like? So I guess when you say there's no formal, you know, regime or regulation for crypto derivatives exchanges, I don't think our rules necessarily look at the products as

opposed to, you know, whether or not they are derivatives. You know, just like there's no, you know, agriculture derivative-specific, you know, exchange, you know, set of rules or energy derivative-specific set of rules. There are, you know, derivative exchange sets of rules that, you know, centralized entities looking to offer contracts, derivatives contracts for trading, you know, are captured by. And I would add, we do have, we do have licensed facilities, trade. crypto products. We have we have futures contracts on Bitcoin trading on the number of licensed exchanges and we have event contracts trading on on exchanges. So we do have we do have

crypto products trading on licensed facilities. Okay, so maybe it's just certain types of crypto derivatives are that are popular not in the U.S. are maybe not ones that would be allowed in the current framework? The derivatives, if you want to list a type of contract or derivative, if you want to list a particular derivative, you have a license to trade derivatives, you submit what we call a product certification saying, we want to trade this product and their standards for products traded on our facilities, that the exchange will submit a product certification to the CFTC. They'll either quote what we call self-certify and say, this meets all your regulatory

requirements, or they'll say, you know, this is a new, a different type of product. We'd like you to actually approve this product before we list it. So they can either self-certify or ask us to approve the product. So if you're a licensed futures exchange or a swap execution facility and you want to trade a novel type of crypto product that nobody else is trading, you can, you know, you apply for a product certification. Now, if you're not approved as a licensed exchange and you want to trade that product in the U.S., you have to get approval to be a licensed exchange. So the first step is becoming an approved exchange. But once you're an approved exchange, and you want to do a new product, it's a product approval process. And so let me.

One of the, oh, no, I'm sorry. I was just going to try to add to that and maybe take a step back, which is that I think a lot of the conversation around crypto derivatives overseas really involves leverage and leverage considerations and how much leverage different exchanges and different. you know, different exchanges can offer and different clients can get. And I think we saw recently an exchange talk about that and decide to start to self-limit the amount of leverage it was going to provide. You know, as we look back in the U.S. at the evolution of the derivatives markets, there was a reason why, given the technology available at the time, we had intermediaries develop, which was because it made no sense from risk management perspective to, you know,

pre-purchase or completely pre-sell a commodity because then it's just a pre-sale. That's not a risk management feature. Risk management feature would, you know, allow for some limited amount of risk to be taken with the cash flows, you know, on top of that. So, you know, a derivatives contract could have, you know, a 10% amount of margin that you'd have to put up, you know, as collateral, basically, that shows you're going to make good on the payments of that contract. Because of the involvement of leverage in risk management and in futures contracts, we have, you know, clearinghouses that developed to trade, to take both sides, you know, of a trade,

so that if one party defaulted, the clearinghouse could stand in the middle and make sure the other party was made good so that their risk management process wasn't impeded. And then as, you know, futures contracts proliferated and expanded to, you know, more potential clients, we have intermediaries that come in to service those clients and provide an extra layer of protection for the clearinghouses so that, you know, there's extra margin put into the, to the, what we call FCMs, but think of them as kind of commodity derivative brokers. And then the FCMs put an extra capital. to the clearing houses so that, you know, if there's a waterfall effect, hopefully there's a set of resources there to ensure that contracts can continue to be made whole from the defaulting party.

So because of that, the agency doesn't necessarily approve margin models, but has a set of standards by which it looks at margin models for exchanges that needs to meet a certain set of mathematical criteria to try to prevent defaults from occurring. And I think some of those rules would probably preclude the extreme amount of leverage that we see overseas that when offered to U.S. clients would conflict with our regulations. And if I could just add again another point on this, historically we have seen with retail currency transactions, the predecessor for the reason we're so concerned about it,

or one of the reasons we're so concerned about these leverage transactions, is with respect to foreign currency, the leveraged foreign currency transactions, now not preceding cryptocurrency, is one of the highest, most fraud-prone areas in our jurisdiction. It's a lot of fraud has occurred in the retail foreign currency space. And because of that,

Congress specifically gave the CFTC jurisdiction over these leveraged retail foreign currency transactions, and then added to that in the Dodd-Frank Act, this same jurisdiction over retail commodity transactions. It's selling these retail products, products to retail consumers with high amounts of leverage. You put $1,000 down. You can get $100,000 worth of exposure at 101 leverage or something like that.

This was an area where a lot of retail people were not sophisticated, and they're promised great opportunity to get rich, very, quickly. So historically, I'm not, there's obviously many, many outstanding actors in the space, but historically it's been an area of rife with fraud. So as we see it move into the cryptocurrency space, that that's of concern to us. Yeah. And just to be clear, for listeners, the two exchanges that did limit their leverage recently were FTCs and Binance, but both said that very, very, very few customers ever used more than 20x leverage. So the max now is 20x on both exchanges. Okay, so in a moment, we're going to talk about defy and how that relates to the CFTC's purview. But first a quick word

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Download the crypto.com app now and get $25 with the code Laura. If you're a hodler, crypto.com earn pays industry leading interest rates on over 30 coins, including Bitcoin at up to 8.5% interest and up to 14% interest on your stable coins. When it's time to spend your crypto, nothing beats the crypto.com visa card, which pays you up to 8% back instantly and gives you 100% rebate for your Netflix, Spotify, and Amazon Prime subscriptions. There is no annual or monthly fees to worry about. Download the crypto.com app and get $25 when using the code Laura, L-A-U-R-A. The link is in the description. Back to my conversation with CFTC commissioners Dan Berkovitz and Brian Quintenz. So the CFTC regulations are almost based on a policy of mandatory intermediation in a way.

And what that means is that for certain transactions falling into certain categories, they're required to take place only on a CFTC regulated exchange, which basically forces this intermediation, which is obviously, antithetical to defy. So defy transactions can kind of get similar results to some commodities transactions. For instance, you can create a collateralized debt position on MakerDAO and use that to mint dye, which is a stable coin peg to the US dollar, which you can then use to buy more ether, which is basically providing yourself more leverage. But this happens through these peer-to-peer protocols.

And so there's no kind of like traditional counterparty that, you know, as as you would traditionally define it. And so some of these CFTC regulations in a way are, you know, they're made for a different world than DFI. And I wanted to get your thoughts on how the COTC would regulate this type of activity, if at all. Let me start off on this one. So our regulations, I think, it's fair to say and it's accurate to say that our regulations really are based on an intermediation model. They don't necessarily mandate it in every instance, but when all these regulations were being written, they were based on exchange-traded models or broker-intermediated

models, and so many of the regulations are centered around and assume the presence of intermediaries. Ultimately, in many of these defy applications, they're very innovative. They approach the market in a different way. I say maybe we don't need intermediaries for everything that they're doing. And there's additional friction and cost, and we could be more efficient and speedier without the intermediaries. And they accomplish that in a number of respects. So the difficulty and the challenge is when you take out an intermediary from some of the functions in a regulatory system that presupposes their existence, How do those two systems mesh?

And that's a question that really defy poses to the regulators and to the marketplace. That doesn't mean that you could totally do without all intermediation or the functions that the intermediaries do in terms of what they do. For example, intermediaries, the exchanges, not only match up parties, which in a defy protocol you can do without the exchange. But they also have a surveillance obligation and an affirmative obligation to make sure that the markets are free from fraud or manipulation. They also basically a clearinghouse in a futures model, a clearinghouse stands behind the trade. So if one party somehow defaults, then the clearinghouse will make it up. Now you could say in the Defy Protocol, well, there's an automatic liquidity provider that will liquidate the contracts before you get to default. And that may be.

And if you don't need a clearinghouse, that's an interesting development that we certainly could look at. So there are some functions I think you could do better without an intermediary, but some an intermediary may be necessary. And the question is, can you do it totally without intermediaries? Many of the ensuring the integrity of the code, explaining to the retail persons how this system works. It's not everybody can go on and all of a sudden analyze the code and figure out that the code is appropriate. And presumably, if there's retail people on there, they'll need somebody to say, yeah, this is a good code. Yes, you can trust the system. So I think we do have a challenge with defy in terms of how to fit this new technology within the regulatory structure.

But as currently exists, the regulatory structure does impose obligations, not just on the regulatory structure. on the intermediaries, but on the market participants, certain obligations on the market participants themselves. So taking out the intermediaries doesn't necessarily take out all the regulations that might apply to a trade in a derivative. So persons operating platforms have to consider, or even the terminology operating platforms, persons developing platforms or developing technologies may want to, you know, we'll need to consider. all of that. And at the moment, with the way that many of these DFI projects are set up, who do you think is a natural entity for you to regulate, for the CFTC in general to regulate?

Well, that's a great question. And so one has to look at a number of factors and to see whether there is actual the sufficient indicia of control or intermediation, who's financing it, who's making the decisions, is somebody benefiting by it, financially? Is there really an organization behind this? How decentralized or centralized is it? And it can be very factual, specific, and it's an evolving area. So we're looking carefully at a number of these things. It's different facilities and different protocols seem to have different degrees of centralization or decentralization. And I think some of these present very interesting questions for us. And earlier when you said that you also regulate the market participants,

does that mean that the CFTC would consider enforcement actions against market participants? Traditionally, and this is one benefit of intermediation, traditionally, and if you've seen this in our enforcement actions to date in the space where we have gone after, we have filed complaints and then taken enforcement actions against if somebody is operating an exchange and it's not registered or basically as a broker is a futures commission merchant without being registered. Our enforcement actions have been directed against those persons, not against the transactions that have taken place on an unregistered facility, but a transaction taken, a futures transaction

that's not taken place, does not take place on a futures exchange is unlawful under the Commodity Exchange Act, but we haven't gone after the end users. We haven't gone after the market participants traditionally. So our focus traditionally has been on the entities who should have been intermediaries in those circumstances. But if, for example, let's take oil, oil market, if one were to trade on a DFI platform, an oil contract, and you might have a market participant who decides I'd rather trade on an unregulated platform than on a regulated platform. You know, that would present a more difficult question for us whether, you know, if somebody consciously decides to trade in an unregulated environment to avoid our regulations,

then somebody who may, a retail person who may be trade on something that somebody's offered them and they shouldn't have offered them without being unregistered. So that's traditionally how we've approached enforcement. but it doesn't, you know, we'll approach each case under the facts and circumstances. Fundamentally, whether or not we take an enforcement action, the contract still is not a lawful contract under the Commodity Exchange Act. So there's a question about the basic enforceability of a contract, let alone whether we take enforcement action against the parties who entered into it. So you're saying like a contract, just a smart contract could be illegal just on its own? Correct. Correct. So that that that's that that that raises an interesting that that's the the commodity exchange acts that for future contract to be legal it has to be traded through a regulated exchange.

This question about the legality of essentially futures contracts that are not traded on exchange was it was a great source of of debate and basically it led to. the Commodity Futures Modernization Act, when the, going back history a little ways, but history is instructive, when the swaps market developed in the 1980s, the question became, well, are swaps, what's the difference between a swap contract and a futures contract? I don't want to go too far down the rabbit hole here, but I do want to point out the history on this. And the argument that swaps contracts were no different, really futures contracts, really troubled the industry in the 1990s.

And it really was one of the motivating factors behind the Commodity Futures Modernization Act of 2000, which provided legal certainty that swaps were, would not have to be traded on futures exchanges. So we had a statute passed by Congress that told the CFDC and the SEC, you can't regulate swaps. They're legal. They're not illegal futures contracts, basically. And then that caused a whole bunch of problems in the 2000s with leading to the financial crisis. And so the swaps markets were regulated. They're not futures contracts. Swaps are not futures.

But the legal uncertainty over a contract that's essentially a futures contract that's not traded on a futures exchange was very, very significant. Financial institutions were very, very concerned about, well, what do I have then if I have a futures contract that's not traded on a futures exchange? So at best, at best, there's legal uncertainty. But I also think there's a strong argument that Commoddy Exchange Act says it shall be unlawful to enter into a contract unless it's on a futures contract unless it's on a registered futures exchange. Well, then how does this square, and, you know, maybe this is just an opinion, but I think there is a view that software development is like an expression of free speech. And so is that something that you would say can be regulated by the CETC simply creating a smart contract?

Well, it's not the creation. The development of the software is one issue. But somebody who enters into a transaction purporting to be a futures transaction, what is it? Is that a contract? If you're going to call it a smart contract, the question is, if it's purporting to be a future, contract? Is it an enforceable contract? What rights do you have if you enter into that to get the money your promise? It might be just a bunch of code that says here's how this code is going to execute. But if it doesn't execute as it promised, if there's some electrical problem or it's misrepresented

or it has some trick in it or somehow you don't get the money that you think you're going to get, what can you do? Now, in our futures world, in the regulated world, you have a very, very high degree of certainty because there's multiple intermediaries in the regulatory system and there's a legal system backing you up, that you are going to get your money provided, you're entitled to it because it's a legal contract. If you don't have a legal contract, you don't have a legal contract. Now, does that mean we're going to prosecute the drafters of the contract? Those are two separate, those are two separate questions, prosecuting the drafters of the contract or the basic legality of the instrument that somebody's purporting to enter into. So a part whether we

prosecute people, the contract itself may be, you know, not a contract that would be recognized in any court of law as something that could be enforced, which I think would be a problem for people who think that, you know, you may have a high degree of confidence in the code. And it may work a lot, but when it doesn't, that's when you need the legal system, that's when you need that assurance. And if somebody takes it from you, steals it from you, you know, what do you have? You have a, if it's not a legal contract, if it's not binding. So I think there's issues both for enforceability and there's issues both, there's other issues in the legality of the instrument. So what you said, whether or not to prosecute the developer is a separate issue, but is that

something that you think is possible? Well, I think we have, again, this is a facts and circumstances, a situation where it depend on the facts and the circumstances of what people are doing when they're developing the code. And it's a highly, highly factual, factually dependent. Okay. But the way you answer that makes it sound then like, again, you know, as you said earlier, it would be more likely you would go after something more like a fraud.

type situation. Is that what you were trying to apply there? Traditionally, yes. Traditionally, that's what we have done. Correct. So, Commissioner Berkowitz, we've been having this very interesting exchange about what the CFTC does cover in Defi. And, you know, you did say recently in a speech that you felt defy does not offer the benefits and productions of traditional markets because of this lack of intermediaries. And then, And you actually said that you thought defy markets for derivatives are a bad idea. So does that mean that you think the CFTC should bring enforcement actions to shut down these many different defy projects that exist?

Or is there some way that participants who would like to register with CVDC could try to do so if, for instance, the Commodity Exchange Act were modified in some fashion? Actually, thank you for asking that, Lauren. I just do want to clarify unlicensed defy is a bad idea. I didn't say that all defy is a bad idea, but unlicensed defy, particularly without intermediaries, is a bad idea, in my opinion. Of course, if defy proponents, operators, or entities who want

defy platforms to exist, I want to come in to the CFDC and say, you know, we understand. that you have to trade futures contracts and swaps on registered facilities. And we would like our facilities to be in compliance with the Atomic, excuse me, the Commodity Exchange Act. How can we do that? Certainly. Part of our mission is to support responsible innovation and fair competition. We have other missions to prevent systemic risk and to ensure market integrity.

but we actually have a statutory responsibility to promote responsible innovation and fair competition. So innovation such as DFI, as long as it's done responsibly, which I mean regulated, we have a statutory obligation to work to see that that can happen. Fair competition as well. We promote competition amongst not just market participants, but amongst different ways of trading the instruments. But it should be fair competition. And by fair, the regulatory playing field is level.

We don't have one regulated market and another unregulated market. So absolutely, we should work. There's advantages to defy, as I mentioned before. If you have a protocol that ensures some particular event won't happen, that the contract operates in such a way that the person's margin has to stay at a certain level. that they have to have certain amount of collateral. And you can show that this is hardwired into the protocol and that you don't need five people in some surveillance department

or five people in some back office somewhere. You can do it by code. Fantastic. Great. You know, we can work to accommodate that now, as we also talked about, the way the regulations are written, it really was written in terms of a fully intermediated market.

So there may be things that, we would have to work on to accomplish that within the current regulatory structure. But I believe the way to do it is to engage with us in the dialogue, say, how can we come into compliance? We want to operate a facility. We have all this great innovation. How can we make it work within the regulatory arena? And we'd be welcoming of that effort and that initiative and devote resources to make it

happen. We've very much encouraged innovation in the space. And Commissioner Quintens, Commissioner Berkovits and I have covered a lot of material here, but I did want to also get your opinion, you know, for the way that the rules and regulations of the CFTC are structured currently, who do you think is the natural entity to regulate when it comes to many of these defy projects? Well, I don't think there is one. And I think that's, I think that's the challenge. And I think, let me say that I agree with Commissioner Brokowitz in terms of what the law says and what our regulations say. But I also want to take a step back from my own perspective and my own philosophical perspective and look at first principles, which is, you know, how defy and the properties, you know, that it has and the, the freedom and liberty to transatlantic.

act in the financial marketplace, how Defi encourages that and supports that, how that really directly relates to an open and free and transparent financial system. And I think, you know, we talked about how the markets evolved over time and how our rules evolved over time to match those in order to ensure the integrity of a transaction so that, you know, leverage defaults didn't cascade, through the system, you know, that is a challenge that DFI is addressing. It's doing it, though, in an unintermediated way through very transparent code. And if we look at, you know, what an ultimate free market, you know, should be, it should be an environment where there are very low or zero, zero barriers to entry, where there is a fierce competition for innovation and to create

efficiencies, and where there is open access to be able to either build or take advantage of that value. Those are all the things that we see in the defy space. And so, you know, I think I'm a little reluctant to put the, you know, the regulations as we have them today onto the DFI space and impede what I believe is a very remarkable amount of innovation that has attracted the best and brightest minds and a lot of capital and intellectual property when, you know, most of it is occurring through very transparent code that any individual, can audit, and that promotes an enormous amount of personal responsibility. When we really start seeing the significant intersection of Defi and the financial system,

or Defi and our legacy futures in derivative space, and I think we're starting to see some of that, but I think a lot of the innovation is occurring within its own ecosystem in defy right now. That's when I think, you know, the CFTC, hopefully we don't wait until then, but that's when we really need to take a look at our rule set again, and Congress needs to take a look at the law and say, is that, you know, products are products and the legal standard for products applies to anything. But we've created a law and a set of regulations around one financial system paradigm. This is a completely new financial system paradigm that does have some risks, but tries to solve, in my view, tries to solve for those risks in a transparent, open way that provides a lot of access and whose principles, I think, match with the foundational principles of this country.

The thing that's going to, I think that's also going to pose a challenge for this space is exactly what Commissioner Berkowitz had said, which is that it is under our law on lawful to enter into, not just offer, but to enter into an off-exchange derivative. contract in taking the CFTC completely out of this perspective out of this out of this out of this for a second even if the agency did nothing with regards to that kind of activity i don't think large financial institutions are going to come into the space and engage with those kinds of products because of a fear of potential liability so you know if if the defy space really wants to attract institutional activity, that's going to be a problem that we have to kind of work to solve for. If it wants to, if it doesn't care or if certain projects don't care about institutional money or institutional have an institutional focus, then, you know, maybe we'll see at what point,

given all of the CFTC's responsibilities and given the legacy, you know, hundreds of trillions of dollars of derivative market activity that we do supervise and where to put defy in that priority list, in my opinion, should be fairly low, given what we already oversee and how interconnected that is directly to the food that we eat and the gas that we put in our cars. We'll see at what point the CFTC ends up taking action. Okay. So it sounds like you're kind of on the side of maybe having Congress update the Commodity Exchange Act or just somehow. creating some sort of new regulatory regime that makes sense for a defy? I think that's going to take a long time.

I think Congress, by design, works very slowly unless there is a significant crisis for which it needs to respond. And in that case, I think, you know, who knows what the success is of the ultimate product that's produced. But my hope would be, as we see the innovation. as we see the access, as we see the transparency, you know, take place in defy and realize that a lot of the risks that we are solving for as regulators in the intermediated space are being solved for in the defy space already, that there is a rethink of the Commodity Exchange Act to allow for

that activity to either continue to occur on its own or to be brought into the regulated system. But to me, it feels a little early to engage in an overly negative way across the space, given the innovation that we see in the principles that apply there. So recently Uniswap Labs announced that it was removing certain tokens from the interface that this company, the centralized company, has created to access the decentralized protocol. And those types of tokens were, for instance, tokenized stocks, mirror stocks, options, and derivatives. and of course this caused a little effort on crypto Twitter. And I wondered, do you think that this kind of compliance and, you know,

basically these types of regulations that, you know, I think you're both kind of saying in certain regards can be outdated, obviously, for this new model. Do you think that that could drive more defy creators and founders to either go the anonymous route or to locate in other jurisdictions, thus taking those jobs to these other economies? I think we want to capture as much innovation within the United States as we can.

And I think that hopefully how we apply the law and how we apply our rules allow that innovation to expand at a rapid pace without endangering, you know, the participants in it. But to your point in your example, I think that gets to some of my questions, as I think about this space, about what's the decentralized part versus the centralized part? And while I think you said Uniswap Labs delisted certain products, the Uniswap Protocol as a decentralized piece of infrastructure, I guess, is still offering those because it's decentralized. To me, that goes to the centralized aspect versus the decentralized aspect and the challenge that it's going to be for the CFTC to apply its rules to the decentralized area in the first place.

Let me just add a couple of things. One is, as both Brian and I were saying, the threshold question regarding the legality of the contracts themselves, as Brian's noted, and I totally agree, it's going to be a barrier to institutional participation in these markets. So whatever level of activity there may or may not be, the purpose of the financial system is not just to trade crypto assets. The purpose of the financial system is to provide methods for raising capital for American businesses and for risk management for American businesses and consumers so that businesses can manage the risks of their commercial activity. So Americans can have retirement and protect their, you know, their assets or grow their assets and protect them in retirement.

And really to have a, for Defi to be a part of the mainstream financial system and say mainstream and fulfill those functions, institutional participation in the liquidity that institutions, the large financial institutions is going to be critical. And for American businesses, it's going to be absolutely critical to enter in a contract. So they're certain are legal or not. there's not legal question to. So I think the legality question, until that's addressed somehow, it's going to be extraordinarily difficult for this industry to grow. My belief is that the ones who are successful at addressing the legal issues and bringing defa into the regulatory sphere,

rather than the ones who are trying to figure out which best offshore jurisdiction to go to to make the most money, are going to be the ones that succeed in the United States with the largest financial system and the largest market in the world. We have the strongest capital formation markets. We have the strongest derivative markets. And a large degree, it's because it's a regulatory system. And people have confidence that when they put their money into it, they're not going to get cheated. Is there cheating? Are there Bernie Madoffs? Yes. Okay. But that's rare and people still have confidence. Our markets just survived the pandemic, the disruption and the volatility caused by worldwide shutdown, and people have confidence in the U.S. market and the U.S. system,

and it's because of our regulations. And our regulations are designed to protect investors. They're not designed to protect the intermediaries. They're designed to protect investors. If you look at the entities in our markets today, the largest entities, exchanges, centralized exchanges on our market, CME and Intercontinental, CME was a disruptor. CME, go back 30 years ago, CME was a, was a, was a, was a, was a, was a, was a, was a, was a, was a, market that was trading hogs. Okay. And what did they do? They innovated. They traded financial products, and they demanded regulation. They were one of the entities that supported the expansion of the

CFDC's jurisdiction into financial commodities in 74 because they wanted the imprimatur and they wanted the stamp of regulation and confidence that brings. Intercontinental Exchange, Jeff Brecker started that as an unregulated exchange to trading natural gas swaps. in the manner that I was describing in an unregulated market. And because of the concerns about the integrity and the acceptance of an unregulated market, they decided they would go the regulated route. And they supported the regulation of their markets.

They were operating an unregulated market. And ICE under leadership of Jeff Brecker said, we want to do regulation. And look, look where they are now. They own the New York Stock Exchange. So they and CME were both disruptors in their days, but they want the regulated route. I really believe that the entities in this market who want to succeed and who will succeed

in adopting all these wonderful innovations and bringing it to American consumers and American businesses are the ones who are going to do it and figure out how to do it the regulated way, not the ones who are going to run to the most accommodating offshore jurisdiction that has no regulatory system. So I think that is the way to go and that's the path to success. And it also sounds like you think going the anonymous route won't work because institutions will want to trade on something that has clear legality. Absolutely. The other factor is that we, the interaction between these platforms and the traditional platforms, we need to know, the CFTC needs to know who is trading on these platforms.

There is transparency. The blockchain is wonderful on transparency, but it's pseudonymous. It's not, you don't know who is doing it. You just know which string of bits there is. Okay. So the interaction with our regulated markets, we're going to have, we need to know who's doing that type of trading, crypto trading, whether somebody has a large position. I mean, you can't have, like in our markets, you know, there's position limits on oil.

There's position limits on a lot of hard commodities. We need to know who is in these markets. So for both the legal certainty reason, the institutions aren't going to come in, I believe, until legal certainty is solved. Plus, there's going to have to be some acceptance of some degree of CFTC market ability to know the identities of the traders in these markets that could have an impact on key commodities. We have to know who's trading oil. we have to know who's trading cotton or wheat to ensure the integrity of these markets for American businesses. All right. So we could spend so much more time talking about Defi because I did have

additional questions. But before we go, we do have to also cover the Bitcoin ETF. The Bitcoin community and the wider crypto community have been waiting for a Bitcoin ETF for some time. SEC Commissioner Haster Perce recently said that a Bitcoin ETF should have approved a long time ago and that its reduction previously shows a double standard being applied to crypto. And additionally, former CFTC Chairman Timothy Mossad said that he believed a Bitcoin ETF would be good for investors and regulators because it could improve the trading integrity on crypto exchanges. What do you think about Commissioner Persis and former Chairman Mossade's remarks? Well, I would just say we made the determination, the CFTC made the determination back in 2000 and

And maybe Brian, correct me if I'm wrong on the year 2016, I think, to permit the Bitcoin Futures contract with a number of conditions regarding the integrity of the spot market in which those prices were based. So we made a determination that under our regulations, under the standard in the Commodity Exchange Act, that the contract was not susceptible to manipulation. I fully defer to the SEC on whether the standard that they're using for whether there's sufficient integrity under the spot price to support an exchange traded fund. Their independent view at this date and time, I'm sure they, you know, they're considering

all the appropriate factors. So I would just defer to the SEC on their determination under their statute. Commissioner Quintan. Thanks. I mean, I agree with Commissioner Berkovitz that this is something that is squarely within the SEC's purview. I think, you know, talking about the decisions that the CFTC has made with regard to Bitcoin futures

may shed some light on how I view this generally. But Dan's right. And I think it was December of 2017. The CFTC allowed or did not object to exchanges listing Bitcoin futures contracts. under a standard that the indexes to which they settled were not readily susceptible to manipulation. In doing so, we didn't place any value judgments on whether or not it was appropriate for market participants to be purchasing Bitcoin futures. We were concerned with is the index readily susceptible to manipulation that this product is going to settle to? And our determination was that it was that it did meet that standard because at least one of those indexes was a mathematical formula that took the volume weighted average price across multiple crypto exchanges over five minute periods over an hour and then average them.

Which means that, you know, could you manipulate that kind of, you know, index in that construction? Maybe if you had enough capital, I think with enough time and enough money, anything's manipulable. I think we all know that. But I think we'd also be able to tell exactly who did it and where and find them and hold them accountable for it. So, you know, from my own perspective, I'm proud to have been involved with the listing of Bitcoin futures in a process that did not put a value judgment one way or another was technology neutral and met the standards of our act, which said the index to which it settles is not really susceptible to manipulation. how that applies to the SEC and whether or not value judgments are part of their process or not or whether or not there are concerns about a product reflecting, you know, the entire ecosystem, you know, in which a product, you know, the underlying contract or product is traded.

You know, those, I don't have a lot of familiarity with that, but I do think that an ETF product on a crypto asset solves for a lot of institutional hesitancy where there is probably demand. And it gets to the accounting treatment of this, which kind of reflects back to my days as an investment manager, because I think in your conversation with Congressman Emmer, you talked about these sitting on balance sheets as intangible assets, which means they can never be written up. And they are usually, and they are regularly tested for impairment, which means that if they trade below the purchase price, they are negatively impaired. So there's no upside from an income statement or balance sheet perspective in maintaining, you know, a crypto asset itself on your balance sheet. But if you gain that

exposure through an ETF, it becomes a security, which is marked to market in real time, and you don't have to worry about the custody issues. So there is, there are broad implications for this. And I hear about demand all the time and given that it is a commodity on which future contracts are already listed, you know, I can't understand, but also nor speak to the hesitancy at our sister agency. That's interesting. Yeah, I have raised that issue about the accounting a few times, and this has affected, obviously, companies like Tesla when they're reporting their earnings because they do hold Bitcoin

on their balance sheet. And I do find it fascinating because, you know, I'm just speaking as a journalist, but to me, it doesn't really make sense. So I do, yeah, find that interesting. And I like that idea that a Bitcoin ETF could resolve those accounting issues for corporations that are interested in getting exposure to Bitcoin and their treasuries. All right. Well, this has been such a fascinating discussion.

I didn't even get to, I don't know, so a huge percentage of my question. So we'll have to have you back. In the meantime, where can people learn more about each of you and the CFTC? CFTC.gov, right? Dan, I think both of our, both of our. Our biographies are up there. All of our speeches, statements, you know, testimony to the extent we've given it, articles, you know, the press office does press releases. But that's a great resource if you want to learn more about us and our philosophies and how we think about the space.

And why don't you each give your Twitter handles as well? It's CFTC-Quintens. I think I'm the same. Yeah. Your CFTZ Qantas do? Oh my gosh. I'm going to have D. Berkowitz at CFTVTC.gov. No, I really, I do want to engage in the dialogue.

I really believe in openness and public participation. And feel free to contact me or my office. I'm happy to discuss these issues with the folks out there. They're important issues. Great. All right. Well, thank you both so much for coming on Unchained. Thank you, Laura.

Appreciate it. Thank you, Laura. Thanks a lot. Thanks so much for joining us today. To learn more about commissioners Dan Brookovitz and Brian Quintens, check out the show notes for this episode. Unchained is produced by me, Laura Shin, with help from Anthony Yun, Daniel Nuss, and Mark Murdoch. Thanks for listening.