Unchained - Unconfirmed: How Congress Might Pass Laws Bad for Proof-of-Stake and DeFi - Ep.261

Starting point is 00:00:04 Hi, everyone. Welcome to Unconfirmed, the show that reveals how the marquee names in crypto are reacting to the week's top headlines and gets the inside scoop on what they see on the horizon. I'm your host, Laura Shin, a journalist with over two decades of experience. I started covering crypto six years ago, and as a senior editor at Forbes, was the first mainstream media reporter to cover cryptocurrency full-time. This is the August 6th, 2021 episode of Unconfirmed. heads up for everyone, we are releasing this episode a little bit later than usual because there was a lot of news happening last night on Thursday, August 5th. And so we decided to wait until all that was over and release the latest on Friday morning. The crypto.com app pays you up to 8.5% interest on your Bitcoin. Get $25 when you download the crypto.com app with code Laura. The link is in the description. Today's guest is Kristen Smith, Executive Director at the Blockchain Association. Welcome, Kristen.

Starting point is 00:01:05 It's great to be back, Laura. The crypto industry has been up in arms about a provision in the $1 trillion infrastructure bill that would have the effect of raising $28 billion from the industry in taxes. Before we get into the latest news on the competing amendments and the nitty-gritty of what happened last night, let's just first set the stage for people who haven't been following the play-by-play. why was the crypto industry concerned about the crypto portion of this bill from the beginning? Yeah, well, I'm going to even back up a little bit further before I get into this specific bill, just to provide some background.

Starting point is 00:01:41 For about two years now, the IRS has been working with the industry and other stakeholders to try to figure out how to do an information reporting requirement for the traditional crypto exchanges. is. And this is something that the IRS would like because at the end of the year, customers of these crypto exchanges don't get a 1099 in the mail like they would from Charles Schwab or somebody else. And they want to have information to help people pay their taxes. The IRS wants that information and the customers want that information. And the centralized crypto exchanges want to provide that information. The problem has been that there hasn't been regulations for how to do that, but that is a process and discussions that have been ongoing. And we believe the IRS,

Starting point is 00:02:26 is very close to doing this. So when the White House and the Senate and the House started looking at an infrastructure package, they were trying to find ways to pay for it that didn't involve raising taxes. And so what they did is they included a small provision in this legislation that would essentially do what the IRS is already doing and make it clear that the IRS had to create an information reporting requirement for exchanges. But the problem is when the language emerged, I guess, about a week and a half ago now, maybe closer to two weeks, the provision expanded the definition of the broker to go far

Starting point is 00:03:10 beyond covering information reporting for centralized exchanges and captured all sorts of other participants in the crypto ecosystem like stakers and miners and software developers and others and tried to also impose those reporting requirements on those entities. And so in the beginning, when I first saw this, I said, oh, well, that's a mistake. Let's get them some language changes. They don't know what they've done because this is complicated. But it became pretty clear on Tuesday last week that our efforts to provide some technical assistance to them weren't going to work and that we needed to fire up the base and sound the alarm. And it's been a pretty intense battle for, I guess, the past eight or nine days now to try to fix it.

Starting point is 00:04:00 And so why do you think that there was resistance to what you initially viewed as just offering technical assistance? Does that now seem that there are particular reasons why they want the language to capture those entities? Well, this is being driven, we believe, largely by the Treasury Department and the White House. And whether or not it is, you know, if we wanted to be generous, we can say there is a knowledge gap there and they don't understand what they're asking for. If you want to be more suspicious, it's that this is a, you know, hard attack on crypto and an attempt to bring it down. I think it's probably somewhere in between. I think I think what Treasury is trying to do is capture activity going on in the defy world, but they don't fully understand the defy. by-world. But the bigger problem has been, you know, legislation is not written by the White House

Starting point is 00:04:58 and Treasury. It is written by Congress, right? And the senators, Portman and Cinema have been the lead on this bill. And they very early on sort of before sharing the language struck a deal with the White House that, hey, we will push this bipartisan bill forward and here are the provisions. And so instead of negotiating with the House, which would be sort of the customary path, the Senate is negotiating with the White House on this. And so when this bipartisan group struck a deal, there has been resistance to making changes to it. And so from the very beginning of this, when this started, you know, about 10 days ago, there's

Starting point is 00:05:36 been a tremendous amount of resistance to making changes, not based off of the substance, but based off of the process. And so that's where we stand, well, we stand a little further than that today. But yeah, that's part of the thing. thinking as to why they don't want to move. They've cut a deal and they don't want to break their deal. Okay. So let's maybe then go into the details of what's happened over the last few days. And let's start with that amendment by senators Ron Wyden, Cynthia Lemis, and Pat Toomey. What did that amendment say and why was this an important suggested change?

Starting point is 00:06:14 Yeah. So the Wyden Lemus-Tumee Amendment is, even in itself, actually, actually, I will say not perfect, but goes a long way towards solving some of the underlying certainty in the Portman Cinema bill that was the broader 2,700-page infrastructure package. The Wyden Amendment, and by the way, the fact that Ron Wyden has emerged as a champion on this issue is remarkable. This is the most active and vocal. he has ever been on these issues. And it is wonderful because he is, he is the chairman of the Senate Finance Committee, which is the tax writing committee. And so when he weighs in on something that's incredibly powerful, he's also been a longstanding champion for the internet. And so we should,

Starting point is 00:07:07 the industry should applaud his emergence on the scene along with Senator Lemmas, who's been a long time champion. And Toomey, who has really, really stepped it up this year. You know, those three are the heroes here. and crypto industry needs to celebrate them because they are going to bat for the crypto ecosystem. But what their amendment does is it provides some clarity that stakers and miners, that software developers, that wallet manufacturers or, you know, developers of software wallets, that those entities aren't captured in the definition of a broker. And the way it's written is that there's room to argue that there are other types of participants in the ecosystem that we could argue down the road are also not intended to be included. And this language itself was negotiated over multiple days.

Starting point is 00:08:04 This was conversations that happened between Lemus and Toomey and Wyden and a core group of industry people who we've been working together with to try to influence this process. And so this was, you know, even though the original language that is in the Portman Cinema Bill that came out of really nowhere with the expanded broker definition, there was a tremendous focus in figuring out how can we fix this because it was very clear early on that they would not accept simply striking the language, that they would not accept just striking the definition of broker, but that we needed to find some alternative definition of broker. And so this is language that all of the stakeholders have signed off on. And we were starting to gain traction on this amendment. I think that, you know, the crypto community really rallied. There is an organization called Fight for the Future who put together a grassroots website that helped people to call their senators. And, you know, as of last night, we had hit about 10,000 calls.

Starting point is 00:09:11 into Senate offices over the past, we'd be a period of about 18 hours, which is remarkable, absolutely remarkable. We have an extended team of professional lobbyists who are working Senate offices on this bill. Some of those are blockchain association lobbyists. Some of those are Coin Center lobbyists. Some of those are Coinbase lobbyists.

Starting point is 00:09:35 You know, DCG has lobbyists, Stellar Development Foundation has lobbyists. It's really been a kind of an all hands-on deck, like, ground game on the lobbying front. We've also been doing digital advertising. We're doing LinkedIn ads targeted at Senate and House offices. We did a buyout of the Washington Post homepage yesterday to try to influence the vote in favor of the amendment. So what was remarkable is that this amendment came in and the industry was able to, within the matter of hours, start pouring out support for this amendment. into these offices.

Starting point is 00:10:11 And, you know, Jesse Powell from Cracken emailed all of his U.S. users to support this. And it was this remarkable turnaround. And we were winning. We were getting close to winning, I should say, because we needed to get to 60 votes, because that was the threshold procedurally for what we needed for this amendment at the time. And then yesterday, as we were, you know, starting to approach and realize, huh, we're actually starting to pick off members and get people in support. And we have a whip count and everybody's, you know, adding all their intel there. So we know where everybody's at.

Starting point is 00:10:50 And then I think what happened is Portman and the White House and Treasury started to get scared because they realized that the crypto industry was actually a sleeping giant and they had awakened it. And so they worked with Senator Mark Warner from Virginia and Portman himself, who was the lead on the broader infrastructure bill. And they put together language that I believe is actually worse than the underlying bill language. Because what it does is it picks proof of work as being the only sort of protected consensus mechanism and leaves out proof of stake or proof of space time or any other type of model. model that's developed there. So it's incredibly short-sighted. It was not vetted with anyone in the industry. This all came together very quickly yesterday and yesterday afternoon. You know, late last night, the administration endorsed the Warner Amendment, which is, you know, sort of another battle there. And throughout the day yesterday, there were very senior people within

Starting point is 00:12:00 and the administration and even the independent agencies that were picking up the phone and calling Democratic senators urging them to oppose the White Amendment and support the Warner Amendment. So the amount, we are getting pushback from the highest levels of government, which in some ways it is a compliment to how effective we have been over the past, you know, 72 hours or even into the past week. But it's incredibly scary because this is the highest levels and this is the industry is not doesn't have the full capability yet that you know other more established industries have and so we are trying to be as efficient as possible as effective as possible and working together as closely as possible not just within the industry

Starting point is 00:12:49 but with our you know allies like coin center um to make sure that you know we are getting putting all of our efforts and resources into the same strategy and the same course So it's definitely, we're not out of the woods yet, obviously. And, you know, the vote on both of these amendments will be on Saturday. And so it is turning out to be, you know, I mean, they could make a movie out of this stuff, right? Like, this is a lot of trauma. All right. So in a moment, we'll discuss why it is that the White House is pushing its weight behind the new proposed amendment.

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Starting point is 00:15:16 in the territories. Segregated funds are administered by cooperators life insurance company. Life insurance is underwritten by cooperators life insurance company. Back to my conversation with Kristen Smith. So as you mentioned, it seems that this new version, the Warner Portman version of the amendment would put a thumb on the scales for proof of work systems over proof of stake systems. And I, you know, upon learning this felt this seemed logically inconsistent because the Democrats have tended to be more on the side of those who express concern about the environmental impact of proof of work points. So do you think it's at the White House? House doesn't understand the implications of this amendment that they support, or do you think that

Starting point is 00:15:59 it is that they do want to favor proof of work over proof of stake? I think that this is largely a lack of understanding about how crypto networks work, largely. I mean, I think if they understood that argument and, you know, they would maybe think twice about this. But the people at the White House and at the Treasury Department that are behind this aren't the ones that are the leaders on climate issues. These are people that care very much about financial surveillance, quite frankly, right? They want to have insight into transactions. They want to know where individuals' money is moving. And I also think that there are a small group of people over there that are worried about the emergence of defy. They're worried about the emergence of stable coins and that,

Starting point is 00:16:59 you know, there are probably some there that see this as an opportunity to really, you know, go after crypto in a way. I don't think that's universal over there. I think some are just trying to solve the tax compliance problem and they think dexes should be left out. Jerry Rito with with CoinCenter always reminds me that decentralized exchange is a verb, not a noun, and that, you know, you can't go after, you know, sort of these dexes if they're truly decentralized. Yeah, this is like the, then they fight you stage, right? It's, I mean, crypto has had such a miraculous, you know, past six to 12 months that it has arrived in the economy in a way that I don't think anybody saw coming. And I think they're scared. And I think they don't know how to write

Starting point is 00:17:48 it and that this is an opportunity to, you know, prevent it from getting out of hand too quickly. And so just to draw out kind of what the implications would be for Defi, essentially this new version of the amendment, the Portman-Warner version, because it does not have that carve out for proof of state coins and I guess for the developers who write protocols, that that's why that's seen as especially bad for DFI because those developers or the people who validate in those systems would have to report on who their users are. Is that what that would mean? And quite frankly, it's impossible for them to do that kind of reporting, right? So if those types of regulations weren't imposed, they would either have to operate out of compliance, leave the United States,

Starting point is 00:18:40 or just simply shut down. And so those are those are not three, great options. You know, what's wonderful about the Wyden-Lumas-Tumee Amendment is that, you know, it's inclusive. It encourages the innovation to stay here in the United States. It encourages, you know, software developers to have the freedom to do what they should be able to do under the First Amendment, right? They should be able to write code. And it's, I think, very forward-looking on Wyden and Lemus and To-Me to step in and do. this. But Warner, you know, we've got some people in the industry that have a good relationship with Senator Warner. On a staff level, they're not the easiest people to get in touch with. They

Starting point is 00:19:29 don't want to engage. They don't want to be helpful. We have had a lot of outreach to them in the past. And for them to come in and do this last minute without consulting anyone is, you know, really, it's just shocking. And it's not how. how policy is supposed to be made. But again, the reason I'm going to Warner is he is sort of known as being technologically savvy. He is close with the administration and the White House wants somebody to come in and save them. And he was their choice. So, okay.

Starting point is 00:20:04 So it seems like you do maybe give some credence to that hypothesis that the drive for all this comes from Treasury. I did see other people on Twitter hypothesizing that this was going to end up as an attack on the industry altogether, that first the administration would try to regulate proof of stake and then later attack proof of work through ESG or environmental social and governance regulations. What do you think of that theory? You know, it's interesting. I saw that as well. I mean, it's not a bad one-two punch, right? I mean, if you could take out proof of stake, that's where a lot of.

Starting point is 00:20:42 lot of the innovation is going on today. And then, you know, we've already seen the proof of work arguments play out, you know, even with Senator Elizabeth Warren and the Senate Banking Committee. And that is a narrative that has emerged this year in a way that we've never seen before. So, you know, whether or not I am suspect that there is somebody in the White House that has such a master vision that they are plotting all of the pieces of crypto and figuring out how to go after them. But I do think there is an underlying sense that this crypto stuff is getting out of control and we need to find every opportunity we can to try to rein it back in. And so I think it was more opportunistic for them to try to expand this definition of broker

Starting point is 00:21:33 because you have to remember in the original language that they circulated, it's specifically included in the definition of broker, decentralized exchanges, which again, was totally undefined, and peer-to-peer. And so that's where their thinking was eventually. And we've been able to pull that back a little bit, but it's still not super clear that, that, you know, minor stakers, software developers are excluded. And so that's why, that's why the, the widen amendment is so important. And, um, So yeah, so here we are. It's going to be a big showdown on Saturday.

Starting point is 00:22:13 So you said that there's going to be a vote tomorrow on Saturday. What happens today at this point? Do you have a sense of which amendment is more likely to, you know, garner the necessary number of votes? And also what would you suggest people who are listening to this show and care about this bill do before tomorrow? Yeah. So the goal today is we need.

Starting point is 00:22:37 to let the community know and we need to let the Senate know that we need to support the Biden Amendment and oppose the Warner Amendment. What the White House is going to try to do in Treasury and say they are going to try to say, oh, the Warner Amendment is the compromise between the original language and the Wyden Amendment. It is not a compromise. It is bad. We need to make sure votes are no. So as I mentioned before, we have a team of extended lobbyists that all, We got them all talking points last night. They're being deployed to those offices today. We are actively updating our whip count,

Starting point is 00:23:14 trying to figure out where people are on each of these amendments. What we need the community to do is sort of twofold. So the community has, the crypto industry has two superpowers. We have the ability to communicate really quickly with each other, which is great because that was one of the reasons that we were able to activate all of these grassroots. We also have really large user bases. I mentioned before that Jesse Powell with Crackett emailed his users. If you are operating a platform with millions of users, we need you to get the word out for them to weigh into Congress. And Fight for the Future.org has a campaign going right now.

Starting point is 00:23:59 that's going to be updated this morning, I believe, to also discuss the Warner Amendment. So we need to get, we need to use our superpower is we need to communicate via Twitter and we need to get word to our user bases to weigh in with the Senate because I think that that will help. I think going forward, there are a couple, there are two kind of underlying problems that we need to fix within the industry in order to prevent these types of things. things from happening to begin with. One is we need to unify. And there are different sort of factions within the crypto policy world.

Starting point is 00:24:39 It's become very clear within the past week that there is a main group of us that can work together really well. I would like to give kudos to the Coinbase policy team, most of whom are new and just showed up. And, you know, if anybody knows me, Coinbase is not my favorite because they're the only member to have ever left the blockchain association. It has been a delight working with our team, and they have been incredibly effective, and they're wonderful to work with. So we need to make sure we continue to work with Coinbase. We need to make sure that we get everybody under one

Starting point is 00:25:15 umbrella because we can't have different voices putting out different messages. Everybody needs to work together. The other problem we need to solve, and I saw some discussion on this on Twitter this morning and and this has been kind of a personal project though quite frankly often gets pushed to the back burner because so many other problems hop up but we need to give to members of Congress and members of the Senate who support us we need to give large financial donations like what people what members of Congress need to know is that hey if I go to bat for crypto crypto will go to bat for me and we need to find a way to organize the political giving and make it so that we work together in a way that makes sense.

Starting point is 00:26:03 You know, there's a lot of people that have supported the cinema. There's a lot of people who have supported Warner. They have not helped us. And it is unfortunate that all of that effort has led to really them doing what is single-handedly like the worst amendment to ever been voted on in all of Congress related to crypto, right? So that's a problem. We need to stop rewarding bad behavior and we need to reward good behavior.

Starting point is 00:26:26 and it shouldn't matter if they're Republican or Democrat. If they're helping us, we should be helping them. And so that's something that I know a lot of people are getting passionate about right now. I've got a lot of ideas about that. And so going forward, you know, we need to unify. We need to be politically active, meaning we need to give political contributions. But today, for Friday and Saturday, we need to fire up the user base. We need to get the word out.

Starting point is 00:26:50 We need to get our celebrity friends tweeting about this. We need to get the fight for the future campaign. in front of as many possible eyeballs as we can so that we can get the word into the Senate that widen is good, Warner is bad, and listen, we can still win this thing. It's not over yet. We are up against the White House. We're up against the Treasury Department. We are up against the managers of this bill, but I think that we can still win this fight. We just need to not give up and we need to keep pushing. And going forward, I think this will be looked back upon as the moment that crypto really woke up. They understood Washington. And going forward, I think

Starting point is 00:27:34 we're going to be a force to be reckoned with. Great. Well, so people should look for those campaigns. And, you know, I'll be sure to put the link to the fight for the future and, you know, whatever else you think is good in the show notes. And yeah, we'll see what happens. Thank you. you so much for coming on Unconfirmed. Yeah, thanks, Laura. Don't forget, next step is the weekly news recap. Thanks for tuning in to this week's news recap. First headline, Ethereum's Lenton Hard Fork hits Mainnet.

Starting point is 00:28:10 On Thursday, Ethereum's long-awaited Lenton Hard Fork went live, bringing with it five Ethereum improvement proposals, each featuring code changes aimed at optimizing the network. Notably, Lenton includes EIP-1559, which has two components. First, it adds a base feed every transaction on Ethereum, intending to make gas fees less volatile and perhaps just slightly less expensive. Secondly, EIP-159 has begun burning those base fees, sending Ethereum to an inaccessible address, leading to an Ethereum first, as tweeted by Alexander Fisher. Quote, we just had our first deflationary Ethereum block.

Starting point is 00:28:48 Block 12965263 had a block reward of two-eath, but burned 2.078 ETH. ETH is ultrasound money. Fisher's excitement about Ether as ultrasound money stems from the belief that by taking ETH out of circulation and therefore limiting supply, ether's investment thesis as hard money, or what many in the Ethereum community are calling ultrasound money, will be very appealing to investors, especially in light of Bitcoin's dominance as a hard-capped asset. Such deflationary pressure on the asset, one could argue, is like to be good for those long Ethereum. Or, as Jeff Benson from DeCript put it, quote, the less of something there is, the higher price that should be able to fetch. And indeed, it

Starting point is 00:29:34 appears investors were buying the Ethereum hype in the days leading up to London, with Ether gaining about 17% over the past week, shooting up from the 2200s to the 2700s in the seven days prior to the main net launch. As of press time on Thursday afternoon, Ethereum has burned over 1,000 Eath, while the price has hit a daily high of $2,818. In related news, Zuccoe Wilcox, founder of Zcash, wants the privacy coin to be more like Ethereum. In a blog post, he proposed that Zcash ditch its proof-of-work consensus algorithm in favor of proof of stake, just as Ethereum plans to do with a shift to Ethereum 2.0. Zucco wrote, quote, while there are many who prefer proof of work, I believe that proof of

Starting point is 00:30:19 stake would make Zcash more valuable to more people. The benefits are great and they far outweigh the drawbacks and risks. He cited lower security costs, energy benefits, and reduced selling pressure on miners as reasons for the change amongst others. Next headline, Cryptopunks and NFTs, not in a bubble? On Wednesday, a crypto punk previously valued at $69,369 was sold for one cent. According to the block, the owner of the punk intended to make a white listed sale, but mistakenly made it available to the open market, where it was immediately snatched up. The buyer, however, still paid a heavy premium for the famous JPEG, as they spent 22Eath, roughly $57,000 in gas fees to bribe an Ethereum miner

Starting point is 00:31:05 to prioritize their transaction in the block. The average price of a Cryptopunk is at an all-time high above $135,000. Additionally, data from the block shows that NFTs just hit a record weekly trading volume high of $339 million, breaking the previous record by a whopping 70%. Cryptopunks accounted for the majority of the volume totaling $207 million. In other NFT news, it's an excellent time to be an NFT marketplace. On Wednesday, Maker's Place, the company that minted and sourced Beeple's Every Days, which sold for $69 million, announced a $30 million Series A led by Bessemer Venture Partners and Pantera Capital.

Starting point is 00:31:48 Maker's place plans to use the cash to, as Forbes put it, quote, help eradicate blockchain foul play on its platform and continue homing in on premium NFTs. On Twitter, OpenC's CEO, Devin Fencer, pointed out the explosive growth in NFTs. Quote, in 2020, OpenC did about $21 million in total transaction volume. In the last two days, we did $95 million. The growth curve for NFTs is insane. Next headline. Robin Hood's hood deemed too volatile for traditional finance. Trading for Robin Hood stock was paused three times by NASDAQ on Wednesday after an

Starting point is 00:32:28 explosive rise in the hood price during the early part of the trading day. After jumping from $54.45 to $65 to $65.60 at the opening bell, NASDAQ reported an LUDP code, which stands for volatility trading pause, meaning a stock cannot be trade due to a dramatic rise slash fall in the price. After a 10-minute pause, Robin Hood ran up to $78 before trading was halted again. By the end of the day, the price had settled at about $62, up nearly 70% from its debut last week. Earlier this year, during the Reddit field GameStop and AMC Mania, Robin Hood infamously halted purchases of certain meme stocks due to volatility, causing an upward on social media and a subsequent meeting between Robin Hood's CEO, Vlad

Starting point is 00:33:15 attentive and Congress. Next headline. DYDX Airdrop plans to leave out U.S. customers. Defy derivatives platform DYDX is launching a governance token, following in the footsteps of uniswap and compound by decentralizing via a retroactive air drop of tokens to its user base. 50% of the tokens will go to the community, 27% will be allocated to past investors, 15% to founders, and 7% of future employees. the DYDX token will give holders governance rights along with fee discounts for trading.

Starting point is 00:33:50 Notably, the Airdrop will have geographic restrictions, specifying that users from prohibited regions will not receive tokens. Quote, DYDX is not available in the United States or other prohibited jurisdictions. If you are resident of or incorporated or headquartered in the United States of America or another prohibited jurisdiction, then you are not permitted to receive a distribution of or transact in DYDX. Next headline, the acquisition business was booming this week. On Monday, NCR, a Fortune 500 company announced the acquisition of Liberty X, a Bitcoin ATM operator.

Starting point is 00:34:25 The purchase will bring over 10,000 Bitcoin ATMs to the software company, helping NCR offer digital currency solutions for banks, retailers, and restaurants. Voyager Digital, a $1.9 billion trading platform, acquire the crypto payment company Coinify in a deal worth $85 million. dollars. Coinify allows businesses to accept crypto while receiving payouts in traditional currency, something for which Voyager CEO Stephen Erlich has noticed an increasing demand for recently. Quote, we believe the USDC stable coin is the best stable coin on the market and that customers want to receive payments in that, Erlich says. We see this vision of payments being the next frontier on top of trading and investing. Coinbase has agreed to buy Zabo, a crypto currency data aggregator, for an undisclosed sum. Founded in 2018, Zabbo provides APIs that enable financial applications

Starting point is 00:35:15 to connect with users' accounts. Jump Capital has purchased SIRDIS 1, a blockchain infrastructure company servicing Solana, Cosmos, and Ethereum, to expand the scope of Jumps' crypto market. While details are slim on how Jumple use its acquisition, Hendrik Hofstadt, founder of Sturdis 1, said, quote, we're incredibly excited to join forces with Jump and leverage their world-class talent and resources to drive forward our mission of advancing the state of the art in decentralized finance. And finally, Fidelity Investments purchased a 7.4 stake in Marathon Digital Holdings and Bitcoin Mining Company across four of its funds, with approximately $20 million. Fidelity joins other institutions such as Vanguard at 7.58%, Susquehanna at 2.7% and BlackRock

Starting point is 00:36:02 at 1.59% as an investor. Next headline. Masari led the way on the crypto fundraising front. Masari, a crypto research firm, has secured $21 million in a series A funding round led by 0.72 ventures, the venture arm of the hedge fund with $22.1 billion under management. Missouri will use the influx of cash to build out its analyst program and fortify its governance and community management tools for Daos. Zen Ledger, a crypto tax software company, announced a $6 million series of,

Starting point is 00:36:35 A led by BlockCcelerate VC. CEO and former Unchained guest, Dan Hannam, remarked that, for Zen Ledger at least, the controversial infrastructure bill is a good thing, saying, quote, they're looking to collect $30 billion in crypto taxes. It's not the worst time to be a crypto tax provider. And finally, trust token, the team behind the DFI protocol, TruFi and TUSD stablecoin, raised a $12.5 million round financed by Block Tower Capital, A16C, and Alameda research. TrueFi enables lending based on credit scores rather than collateral.

Starting point is 00:37:09 Next headline. BSV and Popsicle Finance fall prey to hacks. BSV, a Bitcoin fork, originating from the 2017 block size debate, suffered a massive 51% attack this week, according to Lucas Nutsi, an analyst at Coin Metrics. Apparently, after an initial attack on Monday, the hackers gathered enough hash power to do some damage on Tuesday. Nutsi continued, tweeting, quote, After an attempted attack yesterday, some serious hashing power was unleashed today at 11.46 a.m. and attackers are succeeding. Over a dozen blocks are being reorged and up to three versions of the chain are being mined simultaneously across pools. Coin Metrics later confirmed the hack, noting that its blockchain monitoring tools saw a 14-block reorg of the BSV network.

Starting point is 00:37:54 There is no clear indication as to the hacker's identity or motive at publishing time. Defi Protocol Popsicle Finance lost $25 million in an exploit this week. According to security researcher Muda Gupta, quote, The hack was complex, but the bug was simple. Gupta added that the error, quote, has been exploited in like a dozen other protocols already. Popsicle Finance will be addressing the hack in an AMA on Thursday night just after this podcast is recorded. So be sure to keep an eye out for how they plan to rectify the situation. Time for fun bits.

Starting point is 00:38:27 Buy a sandwich with Bitcoin. Quiznos, a national sandwich chain, is partnering with BACT to launch a pilot that will enable customers to pay with Bitcoin at select locations in Denver, Colorado. Backed, in fact, will pay you to pay in Bitcoin. For customers who download the BACT app, purchase BTC, and use it at a Quiznose, backed will send over a $15 reward in Bitcoin. All right, thanks for tuning in. To learn more about Kristen, the Blockchain Association, and the crypto provision in the

Starting point is 00:38:55 infrastructure bill, be sure to do. check you all links in the show notes. Unconfirmed is produced by me, Laura Shin, with help from Anthony Yoon, Mark Murdoch, and Daniel Ness. Thanks for listening.

Unchained - Unconfirmed: How Congress Might Pass Laws Bad for Proof-of-Stake and DeFi - Ep.261

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