Unchained - Unconfirmed: This Layer 2 Solution Processed More NFT Trades in 24 Hours Than Ethereum Did in 1 Week - Ep.231

Starting point is 00:00:04 Hi, everyone. Welcome to Unconfirmed, the show that reveals how the marketing names and crypto are reacting to the week's top headlines because the insight 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 over five years ago, and as a senior editor at Forbes was the first mainstream media reporter to cover cryptocurrency full-time. NIR is an open-source platform that accelerates the development of decentralized applications, overcoming high fees and slow speeds with its fast, scalable, low-cost, and climate-neutral blockchain protocol. Learn more at N-E-A-R-D-O-R-G.

Starting point is 00:00:42 You may have heard about Interpop, a superteam laser-focused on the emerging landscape of fandom. They are tapping into the latest innovations in NFTs to revolutionize gaming, collectibles, and comics on Tazos. Learn more at hellointerpop.io. The crypto.com app pays you up to 8.4.5. 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 Robbie Ferguson, co-founder and president of Immutable. Welcome, Robbie. Thanks, Laura. Good to be here. Quick disclosure before we begin. Immutable was a previous sponsor of my show. Immutable recently launched the first phase of its layer two scaling protocol, Immutable X. What problem

Starting point is 00:01:28 are you trying to solve with immutable X? We're essentially trying to solve two problems. First is gas fees for NFTs on Ethereum. And second is the security of the scalability solution that solves that problem. So it's not just make trades free. Otherwise, we could have made a brand new blockchain or run things on a centralized database,

Starting point is 00:01:48 which many people are doing. It's how do you actually create a scaling solution that natively uses the network effects and security of Ethereum? And we're the first people to do that. So we're very excited. So despite these issues, which I did experience when I try to buy my my Kings of Leon NFT, which it only cost me 60 bucks, but then the gas fees were 90 bucks. So despite all this, we've actually still seen NFTs take off in the last several months.

Starting point is 00:02:15 And I wondered if you thought this was especially a problem for gaming in a way that it's not for other kinds of NFTs. Absolutely. I mean, you're putting the words in my mouth. So I think the reason we've seen NFTs take off so far, it's mainly been in the digital art category. And that category are very high value assets with low trade volume where the gas fees probably don't matter as much. If you're trading a $69 million B pool, you probably don't care about paying a $60 gas fee. But you do care about the security of the blockchain your asset lives on, which is why it's really, really essential this scalability infrastructure for NFTs is built on Ethereum and not a side chain or not a competing blockchain like flow.

Starting point is 00:02:59 So that's kind of our thesis. But absolutely what we think immutable X is built for is the scale of if an major gaming company wants to move into NFTs, they can do so via immutable X. And that's because we can hit, you know, transactions per second, essentially of more than 9,000. Wow. That's amazing because obviously Ethereum is at, I think, about 15 transactions for second. That's right.

Starting point is 00:03:22 I'm five NFT transactions per second. Okay, okay. So orders of magnitude higher. So how does immutable X solve these issues? Yeah, it's pretty simple, actually, which is, first I want to start with what does layer two actually mean? The definition of a layer two is it inherits the underlying security of the layer one blockchain. So really what we're talking about here is when you perform a trade on immutable X, it's game theoretically secured to the same extent that a transaction on Ethereum mainnet is. And that's really, really important because that's the fundamental difference between building another centralized database or building an actual decentralized solution. And that's what a lot of the people who come and talk to us care about. And also personally, I like it because I think that, you know, Ethereum is the place where all the network effects and activity works.

Starting point is 00:04:09 But back to the actual question, which is how does it work? It's very simple. Right now, every time you perform Ethereum trade on L1, you are performing a transaction at cost gas. You're using work on the Ethereum blockchain. What we do is we take those trades and instead of performing them directly on Ethereum, you sign a transaction with your Ethereum private key. We then grab a bunch of those trades. We wrap them into a proof and that's where Starquare's proving technology comes into play as our technology partner.

Starting point is 00:04:38 And we bundle up that proof and basically upload that the Ethereum blockchain. It's in what is known as a validity proof. And this is quite important, the difference between fraud proofs and validity proofs. So fraud proofs are what optimistic-based solutions use, and they're a really good fit for some things like especially defy contract. So synthetics is obviously launching on optimism. But fundamentally, what you need for NFTs is a solution which is correct from the moment it hits the Ethereum mainnet. And that's the difference between a validity or fraud-based proof is a fraud-based proof requires one to two weeks for it to be correct. Anyone can challenge it or say that it's fraudulent.

Starting point is 00:05:18 And a validity proof is correct from the moment it hits. Ethereum from the moment we upload that proof, which is essential for NFTs because you essentially can't market make or provide synthetic liquidity for people wanting to withdraw NFTs, because how can I as a market maker learn you are one-of-a-kind kings of Leon NFT or whatever unique instance of that NFT was, whereas I can do that for, say, a synthetics where you can have market makers providing sort of a better experience when users want to withdraw. Yeah. And so for gaming, why is that especially important? Well, if you're gaming, you probably want to be able to withdraw your assets instantaneously.

Starting point is 00:05:55 You also want the security of your assets to be completely essentially there. And that's the big reason why we weren't happy going to say like a side chain or a new blockchain. But also importantly is in gaming, you have the ability to mint NFTs as a play-to-earn scheme. So a common progression of games is when you play a player, you receive an item and reward for your essentially experience or have you spending time in the game. And what we do is we allow that to be done completely for free. So game developers can now mean sort of millions of assets a day and they can use that to reward their players and they're not paying $30 to $50 per asset for the creation of those assets. And so on Immutable X, how much are they

Starting point is 00:06:42 paying? Zero. You pay zero for the instantiation of an NFT. We take clips on when they're traded for value. So we make money when the people using our protocol makes money that essentially the way that cost structure works is we pay very significant fixed costs to run the uploading of proofs every year. And that means we're able to make the trades free for everyone who uses the protocol. And then so you're making money on what on the initial sale of the items? Yeah, the initial sale and then user to user trades for value after that. Oh, oh. So when users sell, to each other, then you make a cut from that.

Starting point is 00:07:21 Yeah. Oh, I see. But the important thing is, like, those fees are set at a protocol level. So if a marketplace were to use us and implement us as a gas-free scaling solution for trading their NFTs, they can put whatever marketplace fees they want on top of that. And if a game were to use us, they could put whatever gaming fees they want on top of that. So really, the goal is we kind of make money when we're processing, you know, tens of billions of dollars in volume.

Starting point is 00:07:46 Right, right. Like a long tail as other. games come to your platform. Yeah, and just for listeners, I did also want to mention, so Starkware is the partner enabling this, and they did come on a show I did with DYDX because they're also working with DYDX. And if you're interested in learning more, the difference between optimistic roll-ups versus ZK. Reloves, we did go into that, but essentially optimistic roll-ups have an optimistic attitude of assuming that a transaction is good, which is why they look for fraud after,

Starting point is 00:08:20 where ZK Roll-Ups is more of a pessimistic view, which is trying to be certain from the outset. So since you've launched a medieval X on April 8th, how has that changed trading on God's Unchained? Yeah, so it's been really exciting. It's obviously incredibly pre-Alpha. If you use our marketplace, the front end is a pretty sparse experience,

Starting point is 00:08:44 and that's intentional. We are really just testing does this protocol work in production so our partners can roll out their experiences. But it's been way beyond our expectation. So I think in the first 24 hours alone, we processed more user-to-user NFT trades than Ethereum had done in the previous week. And now we've saved users something like nearly $2 million US dollars in gas fees.

Starting point is 00:09:08 So we've been really excited. The stat that actually really excites me is the average value of a trade is 17. US, no NFTs trade for $17 on layer one because the gas fees, as you say, are like $50 to $90 to trade a single NFT. So really what we're doing is we're unlocking an economy that should exist but can't right now because of the topology of these prices and gas fees underneath. Yeah, so in a moment we're going to talk a little bit more about that, but first a quick word from the sponsors who make this show possible.

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Starting point is 00:10:27 NFT, check out NEAR's fast, scalable, low-cost, open-source platform. NIR is investing 80 million NIR tokens in community-led projects over the course of five years to power sustainable innovation through its ecosystem, with fundraising opportunities and support for DAWS and DAPs to engage fans and reach new audiences. Come learn why NEAR is the infrastructure for innovation at N-EA.org. So earlier when you were talking about the different options for scaling, I noticed that the immutable Twitter account had tweeted, quote, switching away from Ethereum as laughable. And you did kind of imply that in what you were saying.

Starting point is 00:11:09 So just talk about that. Why did you feel that trying a competing blockchain would not be in line with your goals? Look, it's obviously a bold statement to make, but you ultimately have to draw a line in the sand when it comes to discussions of users' security for their assets. And the reason we are so hardline about this is two reasons. One, when we initially set out to build a mutable, we very clearly wanted to build a scaling protocol for NFTs. and we looked at many, many solutions along the way. We looked at plasma, we looked at state channels. Days didn't work out.

Starting point is 00:11:45 And quite frankly, I think a lot of people at that time said for two reasons, they were going to build competing blockchains with Ethereum. One was they wanted to own a very valuable protocol. And that was kind of the favoured VC hypothesis at that time was you had to build a new blockchain in order to be able to control value on your network. And two was nothing was scaling. Ethereum, particularly for NFTs. There was literally no end in sight.

Starting point is 00:12:12 ETH2 was years away. And then literally, I think, three months after Dapper made the decision to build flow, and we were still looking at what to build, ZK roll-ups first worked in production on Ethereum Mainnet, which was really the first time we saw the light at the end of the tunnel for Ethereum scaling. And so that was a very clear choice for us, because ultimately what is going to govern success is where do network effects live? There's a reason that every single ETH killer basically hosted their ICO and Ethereum. There's a reason that successful

Starting point is 00:12:46 NFT projects organically emerge from Ethereum rather than being bought by other big chains. And I can't tell you the amount of times that a large blockchain has come to immutable and said, hey, what do we have to do to get gods unshained on our blockchain? But the truth at the end of the day is two things. One is, you know, a lot of these competitors, are basically the Microsoft services network to the open internet. They're simply going to fail because they're closed garden ecosystems rather than embracing what NFTs are supposed to do, which is an open token standard on a completely decentralized protocol to power the physics of digital ownership. But second, the important thing is where do users want to trade? Where is

Starting point is 00:13:27 money being spent? These things really, really matter. And ultimately, fighting Ethereum's network effect is a very tall task. People have raised tens of billions of dollars to do it. And as of yet, everyone's pretty much failed. The ones with the biggest traction are also the ones with the biggest risk, whether that's because they've just copied, you know, essentially Ethereum's virtual machine and the code running Ethereum and they're going to run the same scaling issues that Ethereum does

Starting point is 00:13:55 without the people building layer twos on top of them. Or because when they take a centralized action, because of the incentives of whoever is running it, everyone realizes the inherent existential risk associated with that database, essentially, and you see capital flight of expensive assets. Hmm. So earlier when you talked about some of these microservices network style blockchains, would that be something like flow, which is more centralized?

Starting point is 00:14:25 Look, yeah. I think ultimately there are a lot of competing blockchains with Ethereum right now, and The short way I say it is the only way any of them are achieving scalability right now is by reducing the decentralization level. You don't just magically create 20,000 TPS. Yes, yes. That is, obviously it's the legendary, what is it called the blockchain, scalability trilemma. So the scalability dilemma, exactly. Yeah.

Starting point is 00:14:54 Now that you have a mutable X, what new features can you offer that you could not before? So this is actually something we're really, really excited about. And the short answer is we're obsessed with providing liquidity for NFTs. What does that mean? It means that when a user buys or trades in NFT, they're getting the best possible price. And the problem with NFTs is the thing that makes them awesome, which is that they're completely unique digital instances

Starting point is 00:15:19 also makes them suck for liquidity. Because if I have 10 million gods unchained NFTs or 1,000 Kings of Leon NFTs, I have 10 million individual orderbooks, each with their own bids, asks, and spreads. And the majority of them will never be traded on because people only want to buy

Starting point is 00:15:37 the cheapest or the most expensive or things with particularly unique provenance. So what you need is you need a way to create fundable markets based on the characteristics of the NFTs at will, while also allowing them to retain their uniqueness. And people have tried to create solutions to this, you know, ERC-1155,

Starting point is 00:15:58 but the problem is they're just losing uniqueness completely. You can never track the provenance of who owns something or who uses something. So the thing we're most excited about these metadata-based orders, we call it, which basically means, let's say there are 100 Kings of Leon NFTs. You can actually trade that set of 100 as a fundable market if you can. And if you really just want the one that was actually used by someone famous or owned by someone famous, you can only trade it on that market. Or you can instantaneously via a zero-knowledge proof, listed on it on.

Starting point is 00:16:30 a fundable market that trades based on the characteristics for NFT. Or you can see the use cases elsewhere, whether it's you're taking a gaming item and you can trade it based on the underlying characteristics of the asset rather than having a thing unique based on its experience. Or whether it's an art asset, this allows us to do the functionality of say open orders like Nifty Gateway implements, but via a decentralized zero-knowledge proof rather than a centralized backend. So this is really really significant and it's impossible to recreate on layer one, which is the thing we're most excited about. Oh, that's, what you just said is something interesting that I didn't understand before.

Starting point is 00:17:12 So for ERC 1155 tokens, there's some metadata that's lost. Oh, interesting. Oh, wow. They're not unique anymore. You know what's so fascinating. Okay. Okay. Because I actually thought that that was some kind of improvement on ERC's 7-10.

Starting point is 00:17:30 and didn't understand there was a trade-off. So that's very fascinating. But for listeners who aren't aware, so an ERC 1155 enables you to do something more similar to like ticket NFTs where, you know, there's probably maybe some kind of general admission type NFT for some event. And so, you know, there's like a limited number,

Starting point is 00:17:54 but, you know, within that class, they're fungible. All right. So very interesting. Thanks for making that point. So Immutable is also now recruiting what you're calling Alpha Partners. What kinds of partners are you looking for?

Starting point is 00:18:06 Are they only other games on decentralized games? Or can there be other kinds of NFT creators? Yeah, no, not at all. Ultimately, we look for kind of businesses to be building on top of our protocol because then those businesses can go and get their customers and kind of build their strategy on top of us, rather than say, if you want to do an NFT drop, we can't support you. but most of the time we're going to be pointing you to someone doing drops run by a

Starting point is 00:18:33 mutable X. So we're really at that kind of protocol level in terms of where do we sit in the stack of businesses. So the way to think about us, and this is often confusing because, you know, there are a bunch of new drops, websites and aggregators and marketplaces coming out of the weeds. And we really don't compete with any of those. Our vision is to be the scalability protocol powering them under the hood. So when you perform a trade on a marketplace,

Starting point is 00:18:59 that marketplace is running that order via Omutable X underwood and they're getting all the benefits of Ethereum securities for NFTs. Or when a game wants to create and trade assets, they're doing so via Omutable X under the hood. But you never even have to go to Omitable.com. They can be run entirely within the context of the gaming application, whether that's Fortnite or whether that's an asset's Creed

Starting point is 00:19:21 or whether that's a runescape. And that's important because, you know, Fortnite isn't going to send you to a mutable.com marketplace. They want it to be freighted within their gaming context. Now, I don't know whether Fortnite will end up using Ethereum at all or whether they'll go with their own system. But the fundamental perspective is, if we're going to make Ethereum mainstream for NFTs, we have to allow people to trade where they want their business to have their users trade.

Starting point is 00:19:45 And so when you talked about businesses, are you primarily imagining games or are there other types of businesses that you think would be interested in the new LACs? So, I mean, we're talking to all the major art marketplaces, all the major drop web sites, all of the, we're actually talking to a few defy NFT contracts, which is really, really interesting. Obviously, SuperFarm is using a Mutable X, and they're essentially a generalized minting protocol so that you can kind of create NFT reward schemes based on any underlying fundable token. So basically, if you need to create or trade NFTs in a decentralized manner and get the best possible, like, liquidity and network effects, for them, come talk to us. And we really do service everyone.

Starting point is 00:20:29 And can you just draw out that example a little bit more with the defy NFT where you said it was like rewards? How does that work? Yeah. So I mean, the big category here is there are a lot of defy contracts and protocols now that are using NFTs. We saw Uniswap V3 do the very bold decision to switch to LP tokens becoming NFTs rather than ERC20s, which allows you to denominate the range of price at which you are happy to be a liquidity provider. We saw yearn finance, issue, and insurance NFT, more and more, we're going to see huge swathes of financial products being represented via non-fundable asset classes. Because this actually is, it represents a huge portion of value in the real world, whether that's, you know, insurance is fundamentally unique.

Starting point is 00:21:18 term deposits are unique contracts. A bunch of the stuff that is traded, like trillions of dollars per year, are traded in unique manners and characteristics. Eventually, they're all going to move to the blockchain. And so those people need a scalable way to do that. Immutable is purchasing carbon credits to offset the gas that the protocol consumes on Ethereum. How did you come to that decision? It was pretty easy for us. It was both a decision that we felt good about and also a decision that is good for our business. And those are the easy, decisions to make. So ultimately, what we really care about is true decentralization of NFTs, right? Which means when people trade an NFT, they're trading on the biggest public blockchain

Starting point is 00:22:01 that no one can take your asset from. That really matters to me because whoever wins this race now over the next few years is going to be the default infrastructure, the digital asset trading for the future universe. People are going to live in VR. They're going to be trading digital assets. like we want to make sure that the infrastructure lives on Ethereum rather than something that's owned by VCs or rather than that's something that's owned by a government. So that is important and that leads me to the next thing, which is you can't have anything holding back people

Starting point is 00:22:28 from using a public blockchain, especially things like carbon neutrality because every other side chain or, you know, public blockchain out there can say that they are completely carbon neutral because they don't use any miners to secure the network. Like it's very easy to have your 300 computers running a database be carbon neutral. You're just paying the electricity costs for 300 laptops. And so it's very important that we give that same ability to Ethereum itself. All right. Yeah. And I just want to remind

Starting point is 00:22:56 listeners that actually, you know, your kind of philosophical stance here, I think harkens back to one of the initial sparks around the popularity of your game, which was the hearthstone controversy where a player on that game expressed his political views about Hong Kong and was, I guess, punished for it. And you guys, you know, invited him to your game and sent him some money. So, yeah, so, you know, a little bit of history there. All right. So in terms of NFTs and gaming, what do you expect to happen with Immutable X that was not

Starting point is 00:23:38 possible before and what might we see from God's Unchanged by the end of the year? So my timeframe six months ago was that mainstream games, I'm talking about market caps between $100 million up to $10 billion. So big studios would start to seriously look and experiment in NFTs in two to three years. I've brought that time frame to now. And every single, you know, Corp Dev Studio. or Strategy Studio is now rapidly spinning up a team to say, how the hell do we make sure we stay on top of NFTs? They're now gone from the curious incumbent who is trying to make sure

Starting point is 00:24:18 that they stay ahead of the game to terrified that there is going to be a new way of running digital assets or running digital economies that they are missing out on. And also, they're seeing this to be a more legitimate way for them to monetize and actually create success for their business. They're not seeing it as much of a disruption and more as something that can actually enhance their business model. So I think that's really exciting from not just a threat perspective, but also a way, hey, this is a way to do it better. What I think immutable X allows is two things. One is we allow that to be done in a way that is dedicated for, like, I mean, you know, we build

Starting point is 00:24:53 gods unchanged so we would have the perfect customer to build the scalability protocol and also to take on hardstone, as you said. But the reality is we've designed this for the most complicated use case and the most expensive use case because you want to be venting millions of millions of NFTs a day if you're a major economy with like 10 million Dow or 50 million Dow, which is what the biggest games in the world are. So we need infrastructure which sports that level of scale. So like in short, what I think a middle of X provides is a way for them to access NFTs that their users can know will always be secure that they can run a business on without having to compromise around we have to send eyeballs to to hear or lose this kind of critical component

Starting point is 00:25:34 of our business strategy. But most importantly, they're going to use NFTs now. We're making sure that they have a viable way to use it on Ethereum rather than going to a centralized death killer. Great. Well, thank you so much for coming on Unconfirmed. It's been great talking with you. Thanks, Laura. It's always a pleasure. Don't forget. Next up is the weekly news recap. Stick around for this week in crypto after this short break. Meet Interpop, a super team redefining the future of NFTs and fandom. From comics and trading card games to digital collectibles and everything in between, they are building the architecture of an entirely new landscape of fandom

Starting point is 00:26:13 using technology built on the TASOS blockchain to drive their vision. Visit hellointerpop.io to learn more. Thanks for tuning in to this week's news recap. First headline Binance US to hire former OCC chair as CEO. On May 1st, Brian Brooks will become the new CEO at Binance U.S. Brooks recently stepped down as the acting head at the Office of the Controller of the Currency, where he served during the final nine months of the Trump administration.

Starting point is 00:26:46 Before joining the OCC, Brooks was the chief legal officer at Coinbase, which is arguably the biggest competitor to Binance U.S.'s parent company, Binance. Under his leadership, the OCC released guidance allowing banks to custody crypto assets for customers and to use stable coins to perform transactions. While his stint at the OCC was brief, spanning from last May to January of this year, during that time he earned the nickname Crypto Controller on social media. Finance U.S. is currently headed by Catherine Coley. Brooks confirmed to CoinDesk that she will depart by early May.

Starting point is 00:27:21 Meanwhile, at Binance, headed by CEO Cheng Peng Zhao, the exchange is facing scrutiny from UK regulators over its launch of digital stock tokens for Tesla and Coinbase. It appears the regulatory status around the tokens, which Binance says, quote, represent a share in a stock corporation is a gray area, since Binance does not clarify whether it is a security or derivative on its website. If deemed securities, the exchange would need to publish a formal investment prospectus. Crypto lender BlockFi announced the addition of Christopher John Carlo, the former chairman of the Commodity Futures Trading Commission, to its board of directors. John Carlo was dubbed Crypto Dad for his support of crypto during his time at the CFTC. Brooks and John Carlo join Brett Redfern, a top regulator at the SEC hired by Coinbase, and Max Baucus, a former senator brought in by Binance in solidifying the trend of crypto companies bringing in U.S. regulatory veterans to help navigate U.S. regulations. Next headline, Coinbase CEO sells less than 2% of his shares. An incorrect yet

Starting point is 00:28:27 semi-viral tweet made the rounds on Saturday suggesting that Coinbase Chief Executive Executive Executive Officer Brian Armstrong sold 71% of his shares during Coinbase's direct listing last week. The chart also mistakenly indicated Chief Financial Officer Alicia Haas sold 100% of her shares. However, the block reports that Armstrong sold less than 2% of its holdings for roughly $290 million, while Haas only sold 15% of her shares last week. Chief Accounting Officer Jennifer Jones led the executive team selling 38% of her stock, While seeing high-level executives offload shares may have seemed disheartening to coin owners, it should have been expected. A direct public listing almost forces insiders to sell because only the

Starting point is 00:29:11 company's existing shares can be sold to the public. In the more standard initial public offering, new stock is issued to the public. Next headline, Bitcoin hash rate drops and so does price. This past weekend, Bitcoin dipped from 60K to 53K in 12 hours. The drop coincide with a black caused by a coal mine explosion in China's Xinjiang region, a significant player in Bitcoin mining. The Bitcoin hash rate, a measure of its computing power, dropped 25%. Mustafa Yulham, vice president of global business development at Bitcoin miner Bixen, tweeted, so an estimated 80% of the mining in China was located in Xinjiang as of last week, and 80% of them were shut down, and it only affected 20 to 25% of the network.

Starting point is 00:30:00 That means that the hash rate in China is currently around 32 to 40% at most. Time to stop the China control network fud. On-chain Bitcoin analyst Willie Wu said, quote, price and hash rate has always been correlated and tweeted a chart showing that hour-by-hour charts of BTC price versus hash rate moving downwards in symmetric fashion over the weekend. The block reports that as of Thursday, miners are gradually coming back online and real-time hash rate has already shown a 24-hour increase in computing power. Next headline, Ethereum reaches new all-time high. Ether broke through $2,600 for the first time on Thursday morning, and a rally fueled by speculation

Starting point is 00:30:43 that the upcoming adoption of Ethereum Improvement Proposal 1559 in which transaction fees will be burned will result in a drop in supply. Nick Spanos, co-founder of Zapp Protocol, told CoinDesk that Ether will, quote, become a deflationary asset, which will, which will, will reduce the coin supply and have a corresponding effect on the price, creating an attraction point for buyers. Ether is up 85% this month, while Bitcoin is down 8%. The recent surge in Ether coincides with Bitcoin market dominance shrinking to levels not seen since 2018, which was the last time Bitcoin market dominance slipped below a 50%. On Thursday, Bitcoin's market cap sat at $1.02 trillion or 48% dominance, while the entire crypto market was at 2.13.

Starting point is 00:31:30 trillion, and ETH accounted for 14% of total market share. Next headline. Dapper Labs headlines another big week in crypto fundraising. The company behind NBA TopShod and CryptoKitties, Dapper Labs, is raising money at a valuation of $7.5 billion from CO2 management, among others. The latest raise will more than double its recent round, which in March valued the NFT company at $2.6 billion. dollars. Digital asset and enterprise blockchain company announced a $120 million series D round

Starting point is 00:32:03 to expand its team by 50% and build a protocol that can seamlessly interact across blockchains. ALEO, a platform specializing in zero knowledge proofs, allowing digital parties to interact without sharing underlying data, received $28 million from A16Z, among others. Finally, Mark Cuban, billionaire investor and Shark Tank Shark announced an investment, in CryptoSlam, an NFT data platform at an undisclosed sum. To hear about his NFT investment thesis, check out his recent appearance on Unchained. Next headline. Losses may reach $2 billion at one of Turkey's largest exchanges as CEO flees.

Starting point is 00:32:44 In echoes of the Quadriga-CX fiasco, the Turkish crypto exchange, Thodex, said it does not have the strength to continue financially, according to Bloomberg. Losses at the exchange could be as high as $2 billion. and the 27-year-old CEO has fled the country. On Wednesday, Thodex halted all transactions. Before shutting down, it was trading more than $585 million in crypto daily and had around 400,000 users. CoinDisk reports that from an undisclosed location, CEO Farouk Fatih Ozar

Starting point is 00:33:17 has come out in opposition to what he calls a smear campaign from customers in the public, explaining the transaction freeze was due to 30,000 user accounts being flagged as suspicious. Bloomberg, however, reports that Ozar has promised to repay all investors and face justice upon his return to Turkey. It also reports that the government has blocked the company's accounts and that the police have raided its headquarters in Istanbul. Next headline. Galaxy Digital is in talks to acquire Bicco. Mike Novagrass's Galaxy Digital is in talks to acquire crypto custody firm Bicco. A source familiar with a situation said to CoinDesk, quote, Galaxy does not do custody, so it makes sense to bring it in-house. Last year, it was PayPal who had

Starting point is 00:34:08 interest in Bitcoin. CoinDisc report said the payments giant offered $750 million in cash for Bitcoin to no avail. PayPal later purchased Curve, a Bitcoin competitor. Galaxy recently made headlines by filing for a Bitcoin ETF with the SEC last week. Next headline. Square and Arc Invest believe Bitcoin mining promotes green energy. A research paper released by the Bitcoin Clean Energy Initiative, with help from Square and Ark Invest, lays out a vision for how Bitcoin mining could accelerate the adoption of renewable energy sources. It makes the case that Bitcoin miners are energy consumers with unique attributes. They can be turned on or off at any time and are completely location agnostic.

Starting point is 00:34:51 Plus, they pay out in a liquid cryptocurrency. The paper calls Bitcoin miner is, quote, an energy buyer of last resort that can be turned on or off at a moment's notice anywhere in the world. It then provides statistics showing that unsubsitized solar and wind energy is now about 3 to 4 cents per kilowatt hour and 2 to 5 cents per kilowatt hour, respectively, while the average cost for fossil fuels such as coal or natural gas is 5 to 7 cents per kilowatt hour. The paper then describes a problem in renewable energy called, quote, the duck curve, in which energy demand is greatest in the late afternoon and early evening, while solar energy is most abundant during the day and wind tends to blow more heavily at night. While batteries will play a crucial role in storing renewable energy, the paper suggests that Bitcoin miners are, quote, an ideal complementary technology for renewables and storage.

Starting point is 00:35:46 Doing so would help more solar and wind projects become profitable, enable more solar and wind projects and places not as well connected to the grid, and provide the grid readily available excess energy for especially hot or cold, and therefore energy-intensive days. Additionally, the paper says it would spur, quote, a sizable transformation and greening of the Bitcoin mining industry. Time for fun bits! Five headlines to break down Dogecoin's crazy week.

Starting point is 00:36:15 The Dogecoin community selected April 20th, aka 420 as Doge Day, with plans to send them a memetic coin to the moon, or at the very least, to 69 cents per coin. Dogecoin's market cap reached $54 billion this week, more than doubling Ethereum's market cap just one year prior. According to the block, institutional investors are getting it on the Doge coin price action, with some market makers in OTC desks handling multi-million dollar trades in Doge. A person using the moniker Doge Community reportedly donated profits from her successful Dogecoin investment to a dog shelter in Florida, paying for all the donation fees of dogs ready to be adopted. Joe Wisenthal, executive editor at Bloomberg, wrote, in I believe all seriousness, Dogecoin's so-called monetary policy may be better than Bitcoins. Fun headlines aside, Dogecoin failed to live up to its own moon-high expectations for April 20th, but the coin actually dropping

Starting point is 00:37:16 about 20% over the 24-hour period. I thought Chow Wing, former founder of Masari, summed up the crazy week in Dogecoin best. The fact that Doge is a number five market cap and about to flip in B&B as a testament to, number one, the power of memes and social media influencers. Two, the sheer amount of central banking liquidity sloshing around the system and inefficiently allocated. Three, how much the truth there is behind the IQ bell curve? Disclosure. I honestly think Dogecoin's price action was just shy of a pump-and-dubman feel bad for the many people who undoubtedly lost money on it. However, the price action community and industry interests led to its inclusion in fun bits. All right, thanks for tuning in. To learn more about Robbie and Immutable X, be sure to check

Starting point is 00:38:00 at the links in the show notes. Follow Unchained on Twitter at Unchained underscore Pod, where you can find all sorts of content ranging from my weekly newsletter to update some of my upcoming book and a whole lot more. Unconfirmed is produced by me, Laura Shin, with help from Anthony U. Mark Murdoch and Daniel Nuss. Thanks for listening.

Unchained - Unconfirmed: This Layer 2 Solution Processed More NFT Trades in 24 Hours Than Ethereum Did in 1 Week - Ep.231

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