Unchained - Why Cap Cuts Its Stabledrop Rewards From $11M to $4M: Uneasy Money

Episode Date: July 17, 2026

Cap's founders on shrinking their Stabledrop from $11M to $4M — plus a $23M hack traced toward North Korea, a BarnBridge governance exploit, and Kain's case to force weak L2s to become their own L1s. ======================================================== Thank you to our sponsors! ⁠⁠⁠Cape⁠⁠: Your biggest crypto vulnerability isn't your wallet, it's your phone number. Cape is America's privacy-first mobile carrier that rotates your SIM identity daily and blocks SIM swaps before they happen. Get 33% off your first six months at ⁠https://cape.co/unchained⁠ (use code: UNCHAINED). ======================================================== Cap committed to a roughly 11 million dollar Stabledrop in February, promising early users stablecoins instead of tokens. A delayed token sale raised less than hoped, and the reward shrank to about 4 million, forcing a fast rewrite of who got paid. Benjamin Sarquis Peillard, Founder and CEO of Cap, and Weso of Cap join Kain Warwick and Taylor Monahan to walk through a restructuring that made yield-token holders whole, left farmers without a windfall, and argue points programs are an uncapped marketing expense many projects cannot afford. The conversation widens into EthSystems, a new Ethereum Foundation spinout backed by Joe Lubin, SharpLink and BitMine, Jesse Pollak handing Base product leadership to Cobie, Robinhood Chain's Morpho integration, and whether Ethereum mainnet undercharges L2s. They revisit BarnBridge's SEC-era DAO structure, a dormant governance exploit, a MetaMask and Revoke.cash delegation tool, and a 23 million dollar Ostium hack Taylor traced toward North Korea. Kain closes with a Three Mile Island analogy: complex systems fail not from one mistake, but from small shortcuts compounding at once. Hosts: ⁠⁠⁠Kain Warwick⁠⁠⁠ - Host of Uneasy Money and Founder of Infinex and Synthetix ⁠⁠⁠Taylor Monahan⁠⁠⁠ - Co-host of Uneasy Money and Security Expert Guests: Benjamin Sarquis Peillard - Founder and CEO of Cap Weso - Co-Founder of Cap Timestamps 🪂 01:30 Benjamin and Weso explain how Cap's Stabledrop plan fell apart post-TGE 💸 08:05 Weso on why uncapped points programs turn into runaway marketing spend 🐦 21:31 Kain and Taylor on crypto Twitter's algorithm flip after a year of exile 📱 24:17 Cape: Get 33% off your first six months of privacy-first mobile service at https://cape.co/unchained 🏛️ 25:09 Why EthSystems, the newest EF spinout, splits Kain on bullish or bearish 🤝 30:20 Taylor on Jesse handing Base app duties to Cobie and what it signals 🎰 36:28 Robinhood Chain's memecoin surge, Morpho ties, and the Cashcat backstory ⚖️ 41:17 Is Ethereum undercharging L2s? Kain makes the case for pushing costs to L1 🔓 55:51 BarnBridge's SEC-era DAO, this week's governance exploit, and the Revoke.cash fix that stops it ☢️ 01:11:31 The Ostium hack: North Korea-linked actor, stolen keys, oracle compromise 💥 01:26:24 Closing rapid-fire: Euler's recovery and an old Vyper compiler bug revisited Learn more about your ad choices. Visit megaphone.fm/adchoices

So I'll give you it's the end of the episode. I'll say we have not attributed this to a specific threat actor whatsoever. However, since I spent eight hours tracing this shit straight yesterday, non-stop, and they did not stop, and I could not keep up. That is a pretty strong indicator that is probably someone in North Korea who's doing this shit. Hey, everyone, I'm Kane Warwick, and welcome to Uneasy Money, because what happens on chain never stays on chain. Before we begin, here's a word from the sponsors that make this show possible.

This episode is brought to you by Cape, America's Privacy First Mobile Carrier. Same premium service you'd expect from any other carrier, but designed so your number, your location, and your data actually stay yours. Get 33% off six months at cape.co slash unchained. All right. Hey, guys. I am here. with my co-host and we have two guests this week. Luca is still out. As Tay pointed out during the break, he's out hunting more advertisers for us.

So hopefully, hopefully he's doing a good job out there. We seem to have some new advertisers. So it must be working. Good luck, Luca. Godspeed. So we have Tay, our resident security expert. and we also have two people joining us from CAP, Benjamin, and WISO. So our first segment this week is CAP and the Stable Drop blow up.

Now, I should say I'm an investor in CAP, so I'm definitely going to throw these guys some softballs, but it's up for them to knock them out of the park. So we'll see how we go. Good luck, guys. Thanks. So let's roll through. So this. So Cap is a stable call.

Get you guys through Megheth, through like one of the mafia, like groups, right? I feel like this was back three years ago or something. So you guys run a point. You mint STC, USD. We're really running out of ticker. here. Yeah. We're into the nine ticker

USD stable coins and and see you which have from reductions. There's no white list and you're deployed around in mega-eath. So the controversy was this stable drop. So in Feb you committed to an 11 million million token stable drop reward. And just to be clear, the stable drop was like, you're going to give people stable coins

instead of tokens. Right. It's a new thing. Stable drop. Yeah. Okay. And then what happened? Okay.

Got it. Got it. I mean. Yeah. And then some stuff happened. And then some stuff happened. A lot of stuff happened. I mean, look, we did a points program, like many people do.

and the points program ended. Most people left, like again, most people do. And we were very happy with our early users, so we decided to give them a reward. And instead of giving them tokens, which is usually what happens, projects give around 5% of their token supply for the first AirDrop.

This is the expected unspoken rule. We decided to try something different and create uncertainty. There's people that want to buy the token when we TG, and there's people that want to get the AirDrop and they're not aligned at all, right? The people that want to buy the token have to wait until theirdrop people sell. The air drop people want to sell as fast as possible, so they all get the best yield possible.

So we said, let's arrange this so that we do an ICO, get some money, give that money to the stable job guys, and then everybody should be happy. We jumped the gun a bit, and we told people the amount of money we wanted to give them, the stable coins we wanted to give them, which is around 5.3.5.5.5. percent of the value of our token, which we thought would be $11, 12 million at the time we were going to do the ICO. Long story short, market tanks, we started a winter. It's not great.

So we postponed the ICO, and we did it now recently. And in the end, that 5% of value is no longer worth $11,12 million. We were able to raise around $4 million. So $4 million was our new budget. Now we have a new budget is much less than the original. And we debated a lot what to do. Do we give tokens? Definitely not in the plans because then we go to zero.

Then what's the point of doing this at all, right? You need to take care of your stakeholders. And so we decided to stick to our 5% budget. And we debated it with our investors, with our, you know, users. And we decided that instead of giving some people maybe one or two percent reward, whereas some people were losing 90, 100 percent. 90, 100% armed the YTs. We said, let's make everybody whole.

So at least nobody lost any money. And so the people that really were losing were the YT guys. And we made them whole. And then everybody else, they didn't make any money, but they didn't lose any money in. That's sort of the background. That's the context. Got it, got it.

And so, I mean, I guess this is like classic, you know, startup founder dilemma, right? You need to start off with a little bit of irrational exuberance and try and get some momentum into something. And then, unfortunately, reality sets in and you're not in a position to necessarily close out every thing that you've committed to. And so now you've got to like figure out how to balance all of this out so that all the various parties are the least unhappy possible, right? I'm guessing. And so were you guys the first ones to do this stable drop concept? Yeah, we got the first one. Before us, I think most people just do regular air drop. They take their token and they give it to people. And I just see time and time again,

these projects coming up and they all do the same thing. They give a token error job to their early users. They pay Binas a bunch of money and then they go to zero. And so we, that's why we sort of we created something, one to make sure our project continues to be successful long term, but to hopefully make farmers happy. Obviously, the farmers are not happy, so that didn't go to 10. That's normal.

Don't worry about it. They're never happy. You could have given them $29. They still better to us. I mean, I don't want to... Of course they matter. No, no, no, of course. Farmers matter, but yeah, farmers.

Farmers have a track record of being unhappy about things. So I think, you know, obviously anytime this is, the fundamental problem in crypto, I think, is that you have way too many autists, right? And if you change the rules on an autistic person, God help you. You're going to have a bad time, right? And we talk to those same. I remember. Like months ago, we were debating, like, how should I bootstrap cap?

Is the points the best way? Yeah, honestly, a lot of your advice should have been taken. I think you have a pretty good take on these like points programs. Wait, what was your team? Don't do it. I think I have a more idea. No, I think you said don't do a push program. Just grow it slowly.

Yeah. Oh, yeah. Okay. What is how it would have been differently, I guess? I also think that points programs are their marketing. And so there's this weird thing in crypto where we decide to give tokens as a marketing expense and then expect people not to just immediately sell them. So I think we're trying to shift that, right?

Like, hey, like, if we're going to give you tokens, you're just trying to farm for yield. So you're going to sell them. We'll just give you the yield. But the problem is that this marketing expense is now uncapped. Right. And so we ended up with way more TVL. was very unproductive for us early on and really didn't feed into the flywheel. And that budget now is like, well, you know, we don't need $500 million of liquidity.

We don't even have that much borrowed demand or can execute on that, you know, early on. But, you know, because people can kind of keep coming in, keep putting in money, keep getting points, now your marketing expense has no cap to it. And so you can grow pretty large. It's all temporary. The points end. Everybody leaves. You got really no productivity.

activity from it. And it's like, how much now do you actually spend on this program that isn't, you know, for the future? So I guess that's probably like the dilemma that a lot of people kind of fall into. And if you were to go and say, hey, like, I'm going to make everybody happy and give away $12 million. Now you've just like cut your throat on the business side for, you know, your runway, your token, everything in the future. So it's a very hard decision to make. Yeah. The incentives are just like, I don't know. They're pretty fucked, right? Would you guys agree? And like, I think we do this to ourselves, though, right? Like, we keep coming up with new mechanisms and new creative ways to try to, like, sort of fix them.

But if you guys were to, like, let's say, like, wave a magic wand, go back in time to, like, the very beginning. Like, what do you think, like, what would be the ideal sort of path, right? With everything that you know now, what do you think is like you could have done? I think first is you have an idea of how much you actually want to spend to the program and then you cap it at that and then you can kind of work towards that budget. And I think the second thing is communicating better. Like we didn't communicate very clearly. You know, we committed to a number, you know, where we couldn't fulfill.

And so, you know, those are pretty big mistakes. And I think if we could definitely go back, we've done those two things strategically better. Yeah. Yeah. mean, that's, we hear, you know this a lot actually, but it is, I think it's hard to build in public as well.

Like the criticism and just like the instant criticism and the ulterior motives. Like, for example, Kane has gotten in trouble for, uh, talking back to the mob at times. Um,

put it lightly. You know what I mean? But it's like, it is hard to build in public with that instant feedback and criticism. Yeah. Someone's got to do it. Someone's got to do it. It's hard to resist.

You have to make a decision and kind of live with it. We did talk to a lot of our investors, you know, try to survey. But at the end of the day, you have to make a decision and, you know, not pick favorites, not treat anybody differently and then live with it, right? And there will be a lot of people online. I'm sure all of us know being in the space for so many years that will kind of like attack you and do say things. yeah absolutely um and so what you know you guys mentioned earlier like obviously the market has taken

a turn i think a lot of companies in the space are feeling this like i mean a lot of companies did layoffs and now they're doing more layoffs right like it's gonna this is going to be this is going to hit what are you guys let's look at like a two-year timeline like what's the ideal sort of path from here. How are you going to regain trust of the mob? You know, and then what are you guys going to show? Well, first of all, I think we're in a better spot today than we were during the Pons program for two reasons. One, today, 98% of our TVL comes from people that are not farming points, right? These are just institutions that we go. We pitch them. They say, yeah, I like cap. I'm going to use it. And now they have, you know, multi-month deals with each other to work at CAP.

And it's very sustainable. And on the other side, yields are very much down. On-chain yields haven't been this bad in a long time. Whereas at CAP, our whole business model is bringing yield from the real world, importing yield from the economy. So our yield is pretty good. And so it doesn't take that much for us to go to an LP and make a, like TVL deals or sort of bring users into our platform. So I'd say that's been good.

On the bad side, obviously now we have to repair some of this like mistrust that might have a reason. Even though, you know, it's not our user base at retail, I do think as builders in the space, we've been here for many years. I was a cheetah, Wessel was a BFI. This is our community, right? we've been part of creating this community. And we didn't leave.

We didn't go to robotics. You didn't go to AI. And so there's nothing else but just to continue shipping and not make more promises. Yeah. I'd also want to say, like, they had nothing to do with the protocol. The protocol itself functions exactly it's supposed to. You know, we had some redemptions. We actually calculated ahead of time post the announcement what we thought was going to happen in redemptions,

making sure we'd have enough liquidity coverage and all that. That all was fine. You know, coincidentally, we just got listed on AVE's, you know, Meghi-Eath deployment and gained some TVL from that 10 days prior to the announcement. At the same time over the weekend, post-the announcement, you know, the biggest liquidity provider on AVE mega-Eath decided to pull out, ran borrow rates really high, which led to obviously that same TBL that was not there 10 days ago to withdraw now on unmoop.

I think that kind of played into this narrative that something was functionally wrong with the protocol, which was not the case at all. Yeah. And so I think that's the most important thing for us is to go ahead and say, just because the Uncenter program didn't work out like it was expected and people were unhappy with it,

the protocol functionally works just as it did before the announcement. And it's the same trustworthy, you know, over collateralized borrowing mechanism that we have been selling to everybody from like the last year. I think, you know, our system also is, you know, bringing institutional borrowers on chain.

And a lot of times those deals take time. So they don't happen within like a month or two months. There's a lot of like legal requirements that you have to go through. There's a lot of different people and different, that have to make decisions on whether or not they're going to, you know, move forward with that. So those decisions take, you know, months over time. So for us, it's executing our entire pipeline that we have in place.

over the next few months to showcase, hey, like, you know, this is a real demand, right? We have, we're bringing private credit borrowing on chain. We have this pipeline of borrowers that are lined up to go ahead and execute via the CAP platform. And then from there, it's just like, you know, showing, hey, like, we can be more transparent with our communication.

So I think the number one way we're going to regain trust is learn from our communication errors, making sure that we're being a little bit more transparent, less opaque around different programs, and delivering transparent yields. Yeah, yeah, that makes sense. So I think like, you know, you guys talk about communication, right? And I think it's fair to say that, you know,

you guys made some mistakes in the comms, right? But the fundamental issue that I see here is you tried to reduce uncertainty. Like we live in an uncertain world. We operate in uncertain space. you tried to reduce uncertainty by saying, we'll give you this fixed thing, right, without knowing necessarily that you could deliver it on the basis that, you know, if you did all of the things right, it would work, right? So that reduced the uncertainty on one hand.

But there's an implicit uncertainty that comes along with that, which is like, if we don't have that money, we can't give it to you, right? The alternative on a points program is we'll give you some tokens that we printed from nothing, which we definitely will have because we can print them. We just don't know if they'll be worth anything, right? And so you're in this situation where you're like, we'll give you some magic beans that may or may not be worth zero, right? Or we'll give you some other thing, but like something has to give in that tradeoff space, right? Now, you know, this is the frustration that I have with people who are farming, right? It's like they have this expectation that things should only go

well for them, right? That they should get a 15% yield with no risk, which is nonsense, right? If yields are at 4%, and they're like, no, but you promised me that I would get 15% and that there was no risk, right? You know, or 20% or whatever the number is, right? Like, it's just not reasonable. Now, you guys could have said, hey, just a heads up, you know, there are implicit risks in, like we may no longer exist in six months time right and you will get no yield like you know a bunch of

things could go wrong you know the world could uh have a nuclear fallout like you know there are inherent risks in the world that may mean that this doesn't get delivered right um i feel like that is probably the thing that if you guys had communicated that a little bit more clearly that like there is no guarantee that you will get these stable points this is our intention it's not wouldn't have stopped the fud. It wouldn't have stopped the fud just to be clear. You would have still got it fudded, but you could have at least slept well at night going,

but we told you, right? I think the miss here is that you were like, we'll definitely do this, and then you're like, oops, we can't. No, I definitely did. Lots of good lessons learned on that side. Trying to reduce the risk, I think that's,

especially when it comes to the TG, we're really focusing on TG, we're launching this token. It's not just about the farmers, it's also about our investors. What are you going to do when you launch a token and you have all this like tokens that had just been sold in this market is tough. But I think we did TG okay.

I think TG happened. We didn't go to zero, which is always good. Yeah, but if you do TG bad, right? Yeah. The farmers are happy, but the farmers are happy and you do TGE bad. Then you have the same mob now yelling at you that the token's going to zero. and what are you going to do to fix it when it's because everybody is just dumping your token incentives.

So you're dealing with the dollars, no matter what you do. Yeah. Yeah. It's, I don't know. Let me ask you this. If you guys were advising a young team, been around for a couple years who's considering doing like points TG token

for whatever their product is, what advice would you give them? Well, this market condition is very different. Right. Now we're in a very low interest rate environment in crypto. And so it is much cheaper for a new project to skip on all the incentives altogether and go to liquid funds and strike deals. Much, much easier. And then you can leverage that to get retail interested because typically they look at TVL when making decisions. That's what I would do.

All right. Yeah. Yeah. I mean, I'm scared. I'm scared of the mob personally. like I don't think you can win against them and that's just you know from my experience like you know and so you have to sort of I guess fall back to like what you know best and have to be but not super ideal so can we talk

we talk here and I we're going to go to our next segment but I was just looking through our runch here that we're not covering this I think we we kind of need to cover because it's become increasingly obvious to me. Just like how wild what was going on was right. Crypto Twitter is back.

Oh, yeah. Like the people that we have all been, we've all been here. This is like the wildest thing, right? Like we've all been here, but we couldn't see each other. We couldn't see each other. We only saw what Nikita, what we did in the. Nikita, but he's like, these 20 guys are the only ones you're allowed to see. The absolute most trash, dipship people on the timeline, this is all you get.

And we're like, oh, man, like, this is like the whole of crypto is bad. Like the vibes were so bad because everyone's like, all I see is this guy, like, Ku Klip capital or like whatever, like some other like dipshit, right? And we were just like, we were just like, everyone's gone. Everyone's abandoned us. Meanwhile, like, everyone's feeling like that, but no one can, it's insane to me that they could construct the algo in this way that like only these, these, like, it's wild. And yet then also they're just like, they're like, okay, the like switch is flicked and you're all

back. And now like all these people, I'm like tweeting and people are like replying to me. And I'm like, oh, you, I remember you. You're smart. She comes to New York, a friendly guy. I know. Here in New York, everybody that you don't see on the Algo is here, and there's a different air. You know, folks here are all bullish because the institutions are here.

Everybody's working hard. But on Cryptootut is a different story. I give myself one Twitter session a day, and that's it because it's been bad. And now recently, it's been a bit better. Yeah. I mean, my timeline turned over, I would say, completely. And also, thank God, there was so much just shit that I don't. I didn't really want to see, but I also loved seeing.

So for me, everyone has a little algal fix, like, weirdness. Yeah. For me, it was the cute animal videos. And so I'd be like on crypto Twitter. And then these, like, cute animal videos and especially the AI generated ones that I'm like, like a penguin eating your fish, but it's 100% AI. It was horrible. And I was like, wait, why am I not?

Why am I seeing a fucking penguin? and not a fucking my friends. And overnight, like, Nikita, like, flipped the switch and it was overnight. So I'm happy about that. But it is, it is wild. And it's wild that they had blocked that I'll go from that long, to be honest. It was like a year.

Yeah, it's been forever. I've been watching Penguins for so long, game. We're going to go to ask, and then we'll be right back to talk about e-systems and another EF spin out and all the fun stuff that's going on there. Yeah. If you hold crypto on your phone, your biggest vulnerability isn't your wallet. It's your carrier. AT&T, Verizon, and T-Mobile have been breached again and again, and SIM swaps are still one of the easiest ways for attackers to drain accounts. That's where CAPE comes in, America's Privacy First Mobile Carrier.

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This one is called ETH Systems. This was a bunch of the guys that were at the EF that were doing much institutional stuff, privacy stuff, and they've spun out to create ETH systems. It's actually a pretty stellar lineup of folks. once again backed by all sorts all sorts of the the Heath diehards

uh gel lubin sharp link bitmine all them so there I mean I don't know I guess one takeaway is like there are these institutional folks that are that are betting big on Ethereum and builders

and like infra layer um and then they're going to be working on I guess sort of like, I don't know, it's a bit weird with all these spinouts. We're going to keep doing basically what they're doing but now in a slightly different format

and not within the EF. I don't know. Polish, bearish, what do you guys? Jump in, yes. I mean, I generally like it when people have these spinouts. I think they're scared of Vitalik. Yeah.

You just see my marketing. On this show. No, I mean, we're huge, we're Ethereum people. I mean, Wester and I, we are Ethereum builders. So we were very bullish on ETH. And I like it when people do these spin-outs because then they have more agency. It's kind of like, do you want everything to be done by state-owned entities? Or do you want to privatize?

I think the real world shows us that privatization is better, I think. Maybe not to get political. But hopefully, now that they have their own group, they can have a little bit more just and actually get stuff done. Yeah. I mean, that's the hope, right? And now we have, so if I'm keeping track correctly, we now have three sort of spinouts.

We have ETH Labs. We have the, I guess, like, the old, like, actual institutional team. And then we have this one, ETH Systems. And then ETH Systems is doing a whole bunch of the privacy stuff as well, which I find quite interesting because, I thought the EF was super focused on privacy. but okay that's fine like I mean

but yeah maybe we'll actually get to do it right maybe we'll actually get real progress there um I don't know I'm bullish on it I think that anything to get people I guess as you say I like the way yeah anything I mean we just got to we gotta build stuff we gotta ship stuff we gotta have people proud of what they build and for some reason that just the amount of

of drama and both internally and externally around the EF in the last year or two has just been I think brutal. I think it's also about the price, irrespective of what's being shipped or not. When people are poor, they start pointing fingers and they get upset and there's like more infighting. Let me tell you, if the same thing was happening at EF, but EF was 10K, there wouldn't be any infighting. There wouldn't be any kind of drama.

Oh, 100%. 100%. What do you think it'll take to get ETH to 10K though? Are these, like, orgs are going to be the thing? If I knew. If I knew, if I knew, ETH would be 10K. Let me tell you.

Yeah, I mean, I don't, yeah, it's true. I think we do actually, I think the biggest thing for me that would give me faith in Eith. Again, and I have faith in Eith. I hold way too much Eith. So let's not be delusional and say that I don't. but that would like I would be super happy about is yeah I think people just like actually committing to something that they really want to build they really want to ship and then just

executing on it and executing really well on it I think we talk a lot and we do a lot of theoretical stuff in Ethereum in general and I would love to see us like as an ecosystem just get a lot better uh a lot better at executing on our dreams, say the least. Yeah, we're a community of researchers, it seems, at Eiff land and not a community of shippers. Obviously, the researching is extremely important, and there's a lot of value to it.

But I've always been, maybe because I'm a founder, I've always been biased towards action. Let's just ship something that's tested out. Let's see how it works. But there's definitely a need for both. Yeah. No, 100%. 100%

I want to actually talk on that note I actually want to jump to what our next segment is because I think it's super relevant did you guys see so Jesse coin base Jesse base Jesse handed off a whole bunch of stuff to Kobe did you see this?

Yeah he's in charge of base app now yeah what okay so what's your read bullish bearish give it to me probably bullish I wasn't a really big fan of the whole creator coins thing that he kept pushing over and over and over again. I don't really understand it. Maybe that's just not mine.

I think the most interesting thing was Jesse made the mistake of writing like eight awards in the same point. And so no arrests like or whatever.

And at the room was like Jesse is giving me best. And now because you're going to Oh, no, no, it's just a sap. It was their Coinbase wallet. And it was base, and now it's been given back, which is just kind of fun. Wait, what's the difference, though?

Does anyone know? Or where, what's the delineation, I guess? Just doing, I don't know, whatever Kobe actually got versus like Olive Base. the base app is that that's the wallet right the wallet so he so he's

basically cobi's done product for that but like the wallet it sounds like okay I mean base can be like all the defy stuff

and maybe infra and everything like this yeah I mean base is huge it's a whole fucking network yeah um Kobe had a funny tweet

it was like uh somebody was complaining about something and he's like well give me 30 days to fix it if I can't, you can call me a scammer. No, one thing to note is that they have such great talent. Like, imagine in your team you have, you know, Jesse and you have Kobe, right?

I think they've done such a great job at base in Coimese general at attracting top-tier people. And so I think there, I think Kobe, you know, anything he touches, he will probably figure something out. Obviously, just, even though Jesse has some issues with this whole, like, Raider stuff, also very chopped here and very glad that they're in crypto and they haven't moved over to AI or something like this. I mean, it's Loki amazing that Kobe's still here. Like, let's be real. Like, Kobe should have retired like a decade ago.

What is he doing? So whenever I see founders like that that are still here when they definitely should have been long gone, I do have a lot of respect for that because they're in it for just like the love of the game. And Kobe's definitely like one of those. like he is yeah he's never but we have cane right here come on and it's like one of the legendary founders

of crypto Kane is still here gracing us with his presence um yeah and Kobe too I think when Kobe joined Coinbase originally I was so yeah I'm so retarded

just like Kobe just like Kobe yes that's cute uh that's also me by the I should return I don't know what I think I're doing. But I was saying when Kobe joined Coinbase originally,

it was like, I could see it, like, two things could happen. First is that he just gets so disgusted by Coinbase and their ivory tower shit. And just like immediately gets super disenchanted and

gives up. And the other is like powers through and brings his his unique sort of like the way he approaches things right never up in the ivory tower like he is always on the ground floor he's always listening to people um bringing that to coinbase and coinbase employees i think he's still doing that like he's been quieter on twitter lately but um it seems like he's bringing some of the product guys at coinbase down a notch and and back into the community and back listening which is if they can do that successfully i think

It's massively important. I think the fact that he's so engaged still is very positive for Coinbase, right? Because it seems like they're at least letting him have some autonomy to go and try to fix things. Or like, you know, letting him come to like with different ideas and like what's broken. I think he tried to tackle like customer service when they first got him over from like that guy. Yeah, it was. He's just answering like, you know, I can't access my wallet. And he's like like the customer service rep and like the Twitter replies.

that's great. It's so good. It's so good. That's what you have to be though. And especially when you do get so big and you get sort of hung up in processes, like, there's a large ori at this point that's been around for a long time. But like if you, yeah, on Twitter, like the biggest complaints for the longest time was like, you can't reach anyone. You get an AI bot support agent.

You're locked out of your wallet. And Kobe was like, I'm just going to stay here on Twitter and cuss and also help you. And that's what's like, and he goes to some fucking. wants. It's so good. It was really good. Kane, by the way, if we didn't say,

Kane is in New Zealand, fighting the evil internet gods in New Zealand, apparently. We cannot do anything. All right. Next segment, should we move on? Yeah? You guys have thoughts on Robin Hood Chains?

What a flash. Yeah, but I have a fear. I've seen this. over and over again, where the hot new thing is really hot for like a month. And then we see it kind of play out like over time and it loses momentum. So it'd be interesting to see like what real difference it's going to change over like, you know, from base or some other ecosystem that was really exciting for a few months and see how sustained it can be. But for right now, people are loving it.

It doesn't have been. Okay, so for listeners who have not been in the trenches with the rest of us, it's been live for two weeks now, basically. They launched. And it was, they had big goals, let's say. Robin Hood Chain has big goals. However, yeah. But the biggest, I guess, actually activity that we've seen just like exponentially go up over the last, well, two weeks has been the,

mostly the meme coins so surprising which is not what I expected I mean how is that surprising though it's like the they don't really have a meme coin in this market lots of people I thought like natural selection

there was a handsome coin went up for like everybody lost their money that like was going to trade these type of things because I think it's trash I think like meme coins are trash and we should get rid of them and it's bad for his face and there's no attention economy doesn't mean anything. What I want to see Robin Hood, you know, they have Robinham gold

where you can earn kind of T-Bill yield, put that on chain. Or do what Stripe did. You know, they brought a lot of their deposits onto tempo. I think that's the stuff I want to see Robin Hood do and forget about this like Naincoin stuff. Because not last long anyways. Yeah, but they are going to do like tokenized stocks and stuff like that. So I think they're trying to use the chain for like trying to do a mix of like what they do proprietary to them.

Like their, you know, application, their Robin Hood app where they're stock trading, option trading, you know, crypto trading. And also trying to bring that stuff on chain. I think that's sort of the connection you're trying to make there. But I think you can already trade certain like equities and stuff on Robin Hood chain. So I don't know. The big morpho integration. That was very good. I mean, let's talk about Morpho.

They've been getting some very good integrations. Coinbase and now what they did with Robin Hood. That's amazing. Because it sets like the, it's just a path for a lot of other defy startups to do similar things. I think they're doing fantastic. Yeah. And I think, I mean, ultimately,

I don't necessarily have a problem with Robin Hood accidentally stumbling into the meme coin madness and, you know, volume speaking. on that. I do think that they have to get diversity though. You have to get it and convert some of those means into something else. It's not enough to just ride

that wave, especially because everything's fine until everyone gets rugged and then no to your users have any money. You want to protect the user. That's what I mean, but I said meme quiz are trash. I'm not trying to hate on anyone. It's probably like the early,

like how do we grab early attention, right? If they just launched, they had nothing. Like, it was like, hey, we have morpho lending where you can earn 7% yield. People would be, okay. It's pretty sexy to me. Yeah. But I guess I'm a, I'm a deep nerd. They grabbed all that attention with like Cash Cat and stuff like that, which I didn't even realize.

I don't know, you knew that. But like, Cash Cat was it supposed to be like Robin Hood's original name or something? I didn't know. I didn't know that before. I was like, why is this meme so popular? I don't really get it. I was like, oh, it was because it was the name before Robin Hood was

Robin Hood was supposed to be Cash Gad or something like that. That's a terrible name. It is a bad name. They did much better than Robin Hood. It's a good to have more of these retail because I, maybe it's just me, but I see Robin Hood and Base in a similar

neighborhood of like where they're trying to attract. You have Coinbase and then Robin Hood with Robin Hood chain. And the more of these you have, the more competition and competition is fantastic. because it makes their space better. Well, they're porting their users, right? Coinbase is porting on their Coinbase application users,

and the same thing with Robin Hood, porting those users onto their chain. So, I think I'll tell you, it's pretty, it's much easier for Meghive to convince Robin Hood chain user to use their platform than it is for them to convince an average person on the street to, you know, download a wallet and start using their platform. And so I think, you know,

or the more users we can get anywhere in the blockchain, I think it will benefit all of us. Because then I could go pitch them. They come use cap now that they're already using the blockchain. Yeah, exactly. And then so the second half of this, I guess conversation, and I'm really interested to hear you guys this takes on this, is obviously Robin Hood chain has taken off

and it's only been a short amount of time, but there is activity, mad activity going on. But then people are sort of looking at how much Robin Hood chain is, put it simply, paying Ethereum main net, right? And they're getting quite upset about the fact that there's not, you know, it's sort of starting to feel

on the surface that like, you know, Ethereum is perhaps undercharging people for settlement, being the settlement layer. And obviously there's two sides to this. There's people who are like, yeah, it's really. way too cheap, crank up the prices. Like, what are we doing?

And there's other people that are like, social sleep, right? So what do you guys think? This is not new, though, right? Like, all the sequencer, L2, yeah, I mean, the same argument we've had for years, I think about L2's. I think Metallic himself even came out and said something

in that regard about how, you know, the L2 vision didn't work out like he thought it was going to work out. But it's really, it's bringing in very little, revenue for actually the mothership. So I don't think that's going to get what you pay for. Right? It's not like you have

Ethereum level security on these L2s. They're extremely centralized. And so at the end of the day, yes, it's cheap. Yes, they're not paying a lot, but you're not getting that much either. But you're completely at the realm of these teams that are running the L2s.

Yeah. Yeah. And I go back and forth Because on the one hand, I think if you look at say how much like Robin Hood pain, Robinhood, like how much they are making. And also in this case, they're paying a percentage to Arbitum, foundation, whatever, right? That's how the Dow works, right? You look at those two numbers and then you look at the number that's going to Ethereum and you're like, wait, we should be charging more, right? Like just from a basic business perspective.

On the other hand, if you, I don't know. Would they still be here? Would they still be here? Is it really like, can you really say that it's lost revenue? I'm not convinced. How do you charge more? I mean, you could, well, I mean, we lowered the whole blobs. It was years ago.

Yeah. With the introduction of blobs, they made the settlement cheaper. and at the time it was massively important that we did this because the L1 was impossibly expensive but even L2s were massively expensive and so they introduced some new technology

some new settlement they're called Blobs which is a great name love it but now they're super super cheap and then of course now in hindsight we're like wait is this really the vision, was this the way to go? What's the value accrual to Ethereum and Eith, the asset? You know, it is an old debate. But I think, yeah, it's interesting to have the conversation restarted in light of Robin Hood chain, but also just in light of like people kind of, not saying that people are completely over L2s at this point, but it's not, you know, it's not 2022 anymore. It's not, and it's

definitely not like 2017, 2018, when you couldn't even settle on main net, right? I think you still have to keep transaction fees down for people to still wanting to interact on chain and build. I think when I was deploying contracts a few years ago, it was costing me like $300 to deploy a contract. I think upwards of $1,000 is like the most expense. So it becomes, like, and that's just to do to deploy a contract, but interact, I think When I first used Ave, like 2019, I think it cost me like $50 to deposit $100 worth of to Ape to try it out. Yeah.

It's like big. Yeah, it's so much voice. It was really bad. It was really bad. I think for startups, because let's think about Ethereum as a startup, you don't really need to monetize that fast. How many years did it take for Amazon to turn a profit? it and didn't matter.

I think our KPI for Ethereum should be how many companies are posting to Ethereum. Because the reality is, if you're not building on Ethereum, you're paying in tokens. Every chain outside of Ethereum, if you want to get real capital, you're paying it with tokens.

And that says everything. And so at least Robin Hood is building on Ethereum and they're not making their own chain like Stripe. And I hope more people do it. Because I would take that 100 times over than making a few more bucks over like a lesser brand, for example. Yeah. Yeah, 100%.

And I think, I don't know, I still think that there is immense value to keeping, I guess, things a bit eccentric. Even if the, you know, if you run the hard numbers and you're like, yeah, you are still. There's still a consistency. If everything, I think we'd be in a worse position if everything was like a truly completely separate. Like you just had old L1, all 1, L1. I mean, it's just like the innovation goes down. The interoperability goes down. Like it's even like the L2, their experience is not the best.

But like it's way better than if you go back in time to like when it was like Bitcoin, like coin, Doge, Benaro. Right? We do have interoperability. We do have settlement. We do have assurances where, yeah, you can, like, force yourself back to the L1. We don't have to rely on fully centralized things to bridge back and forth. You can't have innovation. You can't have different rules.

But you still do get that, the interoperability. So, I don't know. I'm not, it's my take ultimately is like. I'm not super upset that Ethereum isn't making more here. I get the conversation, but I think it's more important to keep people using this stuff, right? Yes. We're just talking about Robin Hood chain, but also, like, you know, the conversation on, like, is Ethereum undercharging these L2s? Yeah.

I mean, yes. I've been an advocate for, like, I've been an advocate for a while. like Ethereum should charge more. You know, it's like there's a massive advantage that L2s get from not needing to deal with all of the stuff that Ethereum has to deal with, but still, you know, getting to be a chain. And I think that like it does not capture enough of that value. Like unequivocally, it should capture more. The question is, can it?

Like, you should definitely try, right? what would the consequence be of trying to capture that? Maybe all the L2s are forced to become L1s. That actually would also not be too bad. Because if all of the L2s stopped LARPing as decentralized and had to actually be decentralized, they would find that it's much harder than it looks and it would be at least an equal playing field, right?

Like I promise you, like the 85th L2 is not viable as an L1. if they had to actually like produce their own blocks and have validators and clients and all of that stuff right um so so i you know i think it would be the the fact that like we have this weird l2 thing in the first place is like such a strange pot-the-pen weird thing um i think we will eventually kind of they'll they'll either die off or they'll become l-1s and it'll be a bunch of l-1s competing against each other um And you won't just be able to, like, be a parasite hanging off Ethereum the way that we have now. Yeah. But do you think that we can... I mean, do you think, like, it's realistic that Eath could, like, raise the prices now? Or do you just wish that... Yeah.

Yeah. Like, yeah, for sure. Like, what are they going to do? That, I mean, this is true. I mean, there are real benefits to be... align to D. If you look at the, I think in terms of capital, right, we have a DFI startup. If you look at the cost of capital for incentivizing outside of the L2s, outside of Ethereum, it's meaningfully higher. I mean, go to AVE on Monad and look at the price that

the market is giving for supplying USDC and compare that to all the L2s. It's much higher. Or go to any of these other auto ones, either they have no liquidity or if they have it at scale is costing them much higher. And so I think that's the market saying it costs you more. And so I as an L2, I'd pay a little bit more because when I'm paying nothing, if it means I can save 2% APR on the capital. Yeah, agreed. I just think it would force much more clear competitive landscape is what I think would happen,

right? At the moment you have this weird uncanny valley where like, you know, there's so many flavors of L2s. It's not clear. hardly centralized. They are relative to each other. We've been trying to figure this out for five years. No one really has a good sense of it. So my, my view would be if, if Ethereum jacked up the price, either people who couldn't leave would have to pay it, right? And the people who could leave would leave, and then they're competing on equal playing field. So I think it's good on both sides

for Ethereum, right? Like if, you know, if Arbitrum had to be an L1, it would probably be good for operative on some level, right? To actually just be like, all right, fine, fuck it, we're in 01, let's go. Let's try and compete directly. Yes, yeah. We'll see. We'll see. I mean, yeah, there's arguments on both sides.

Again, we're back to incentives, though. And I do think if we, if anyone wants to change anything, I think bear market has time to do it. Rip the fucking bandit all. Oh, yeah. Let people get mad. Let it, let the time you can do anything in a bar market. Yeah, yeah, the thing, you know, the thing that I always say, right, is like the status quo is what reigns, right?

The status quo can be fucking insanity. Look at some of the status quo things that we have right now. It can be sheer lunacy, but because you have so many autists in the space, they will defend that because it's the current rule structure that they exist in, like their lives depend on it, right? And so when you come out of a bare market, whatever the status quo is, yeah, you'd have to fight. with them a little bit, but like they will be the ones who will be like getting the pitchforks out in the bull market if anyone tries to change anything. And so you actually like build up this like, you know, kind of defense system. So that when you get into a bull market, the new status quo, whatever comes out of the bear market is like the thing that is the stable equilibrium

now. And that's what will run through the bit the bull. So. And it takes guts, man. You make a mistake and you get points. Oh yeah. Yeah, burned. Yeah. But better to get burned in a bare market, right? Because people have short memories. They'll forget about it. No one will even remember in a bull market that that even happened.

They'll be like five guys who are still crying about it. Yeah. And you can rebuild stronger, right? You can, you can, you know, I think the community is a bit more. They still get very upset about things. Let's not be. Let's not be crazy. And I was looking at the timeline today.

Some people are like attacking Caledora and I'm like, can we all just come down? It's just going to hide down. It is. I think when there's, I don't know, it's a bit narrower of a community. The anger lasts a bit. It's a bit shorter.

I think you can weather it a bit easier. It's like, ooh, bull market anger is. But here's the thing though, right? It's like in a bare market, it used to be. that you had all of your friends around and so the people who were angry were like really balanced by like your friends

kind of being like, it's okay, right? But we lost that until like three days ago because on the timeline all you had was like the cancer people who were just like you know, fucking like losing their shit about like you couldn't see your friends right. Now at least as of like 48 hours ago your friends are back on the timeline right?

So like you see a balanced thing. You do something And you see like someone tweets like, hey, it's okay. Like, don't worry about it because they actually saw that people were attacking you and they jump in to be like, no, no, this is a good guy. A week ago, that didn't happen. It was just like wall-to-wall, like, fucking cancer people. So, yeah, anyway, here we are. Hopefully, Nikita doesn't fuck with Diago anymore.

And we're back for good. Literally. All right. Should we, what's the next? we're going to talk well we have a choice so we can end it here or we can do a little we can do like a rapid fire on the latest and greatest

hacks that happened this week your guys' choice yeah let's do it let's do it yeah you got you got my favorite CTO here so all right so we'll start with my favorite I hate this but my favorite one

Barnbridge you guys remember Barnbridge dude don't even get me started don't even get me started So, Barnbridge, poor Barnbridge. Good team, good guys, got absolutely screwed by the SEC. Oh, my God. The SEC, like, so I was really involved in Barbridge, right?

Like, Tyler showed up and was like, hey, I've got this idea. And I was like, yeah, I'll help you. This was that I was on my, like, you know, arc of, like, trying to help founders and wasn't as busy as I am now. And now I'm like, sorry, I can't help you guys. But, you know, I was like, all right, how are you guys want to do this? Like, you're in America, you want to do this Dow. Like, what, you know, I was like, my hot take is your only way to protect yourself here is, like,

no entities, know anything. If you set up a foundation, it'll be a target or whatever. And it worked until it didn't. And then the SEC was like unincorporated association, you know, I mean, at the end of the day, I think anyone who did anything during the last SEC regime in America is certifiably insane. Like any crypto person in America during that reign of terror, certifiably insane.

But these guys in particular got singled out unfairly. Because I think that they, like they did. You know, like, Tyler lost me a lot of money, right? Like I lost a lot of money in a bunch of schemes of Tyler's. even things that he wasn't involved in like Olympus Dow I don't know if you guys remember so there was a thing called Fiatow

Dude so I went into Olympus super early I say I lost money I probably didn't even really lose money I probably put like 100K in and at the peak it was 5 mil right and Tyler comes into my DMs and he goes Hey

you have a bunch of ohm you need to do something with it And I'm like, do I? And he's like, yeah, of course you do. Like, what are you? Like, he's just sitting there gathering dust. And I was like, what should I do with it? And he's like, you should put it into Fiat Dow.

And I was like, that doesn't sound great. I don't know about it. I was like, I was like, okay, what do I have to do? And this is like before agents, right? So you had to do everything manually yourself. So he sends me this like 17 step process, which was so convoluted and insane. And I'm like, I'm not doing this man. Like, I'm just not.

I'm sorry. And he's like, no, no, no, no. Like, we need the TV. like you've got to do it and I was like fine, whatever. So it literally took me like six hours of doing transactions. I finally get in there. I'm in Fiatel. Yeah, it was like

genuinely 17 transactions and you had to move stuff around on different chains. It was a nightmare. You have to use like the ether scan contracts time? Yeah, of course. Of course he did. Of course. You had to go into the etherstand. Yeah, of course. Like there's no interface for this shit, right?

And like it didn't work and like this was like one of those And I used to do this stuff all the time, right? Like, I used to be like, I'm just going to figure it out. Anyway, so I finally get through it all. I put all of my Ome into Fiatowl. And then, like, a week later, Ome starts crashing, right? And I'm like, oh, shit, I better get it out of Fiat Dow.

Fine print. There's a 28-day unlock window in the Fiattax. 28. And by the time, it was all set in. done my own was back to like 400 grand or something like that so i like round trips that entire thing and it was all tyler's fault so he's the good guy but like man man like i've got some battle scars from that guy yeah so and i mean barnbridge too is pretty i mean i i never played with barnbridge but like my impression was like the real o g d jans

were the ones in yeah oh yeah oh my god there was so did too too generate those guys. Like, everything that they did was, like, so D-Gen. And, like, D-Gens loved it, right? Like, that was the audience. Like, Barnbridge came up at, like, the exact right time where they had a chance to, like, design this system purely... Because, you know, when we're building synthetics,

we didn't even know what a D-Gen was. Like, D-Gen Spartan coined that term well into the synthetics art, right? Like, in the synthetics discord, he's like, all right, we're all-D-Gens, and we're like, we are? And he was like, yeah, yeah, we're DGens. Like, that's what it is, right? And we're like, okay, cool. And so, you know, you didn't have a chance to, like, custom design a system for DGens.

You would build a system and it happened to be interesting to them and they, like, got super excited about it. The Barnbridge guys were like, no, no, no. We're going to design this from first principles to be, like, as degenerate as possible. Like, every aspect of it was, like, super DGEN. And so the D-JNs just loved it. And it was so much more success. I really didn't, like, I was like,

this is a cool idea, but it became so much more successful than I was expecting it to, which of course, then SEC shows up and all of that stuff, right? So it was a bit, the whole thing was very unfortunate. Yeah, so that's what I had to see the... So go ahead.

No, yeah, so the SDC showed up. And also because of the SEC, and this is like super important to remember, like, that's literally going after these guys, and other people legitimately really hard going after them. So one thing that Barnbridge did to try to avoid that outcome, which happened anyways, was they set up governance over the protocol for certain things

so that it was controlled by the Dow or whatever. The Dow, yeah, exactly. Yes, so everybody did, right? You just set up a Dow and promote a name. You have to. You have to. You forget about it. Like, we forgot.

Because of the UTC was trying to take him down and throw you in jail. Okay. So fast forward to this week, like Monday or something, very similar to last week, nobody who was watching the governance. And so a proposal. And this is like how inactive the governance was in general. Proposal 14. Warnbridge is like, what, five years old now, six years old or something? Yeah, five six years old.

Yeah. Proposal. 14 passed and then 15 there might be a 16 at this point but basically someone I mean it's the standard governance attack someone acquired a bunch of tokens

and then created a proposal to in this case they're actually not going after like the treasury they're going after they're basically updating like the various proxies and contracts that run Barnbridge

and then they're taking they're able to take end users money via anyone that has an open approval. And so this is like such an Ethereum classic like fucking the approvals. So in order to use Barnbridge at some point in the last five or six years, any address that had like approved their contracts

to be able to like spend the tokens and move the positions or whatever, they have like an open infinite approval. And some of these are literally five years old. And then now fast forward someone does these proposals. for the governance. And now they can take all the end users money.

And so that's what they've done. There's been like three waves. I think it's kind of flying under the radar because the amounts of money. It's like 600K, 700K, 800K. It's not a huge, huge amount. I guarantee you that some of that is my money. Like 100%. It's like some

forgotten wallet. Like this is like Tyler back from the grave to like wreck me one more time. Like I'm confident that I interacted with Barbrage and didn't revoke approvals in some like random wallet that is like a dormer wallet. Like for sure. I haven't even looked because I'm like, I don't even want to see it. But like, I feel pretty certain. I did look.

We did a poll for all the NS names and Twitter handles and stuff in our database. And you were not on it. So as long as you. Okay. But it would be, it would not be my main wallet. It would not be my memory. It would be like some side wallet. Exactly.

Yeah. Yeah. Use guys, if you use pain.Eath for your degeneracy, downside. Twitter might find you and come after you. Upside. Taylor will message you on Twitter and let you know that you have an open approval. Yeah, exactly. Tradeoffs.

Yeah, trade offs. Can I ask the question about this? Yeah, yeah. Is there any real reason to hook up upgradeability around a Dow governance proposal nowadays? is there like how many active actual DAOs are there? No. I think

AVE? Actually no, because now they're doing more lab stuff, right? Yeah, but their stuff their stuff isn't like auto executing, right? No. No, no. This was pure D-Gen, right? This was like we're just going to wire it all into the chain and see what happens. Yeah, and the

Dowel, the tokens control. It, Tyler has no control. And the way that you sort of proved that was like Tyler can't update the contracts or like Tyler and buddies can't update the standard we wanted everything to be automatic and everything to be

fully on chain token weighted exactly yeah right and so yeah this is the I guess another outcome I think it's just sad like the SEC just in my opinion

just failed so magnificently on every level they came after people that they didn't really make a difference though right Like, they didn't really save anyone there. And then as a result, let's make a word. Like, FTX and UST, they weren't able to protect us from them. But they protected us from Barnbridge.

And, like, open, like, the open guys, like, squeak? Like, why are you coming off to squeak? Like, what the hell is your problem? Like, it was, like, so nonsensical the people that, but, like, you know, I've said this before. the reason why they went after those people was very tactical. Like that SEC, they were smart,

but they were monsters and they were smart, right? Like, they went off to people to send a message. Like, they would, like, you know, kick down someone's door and, like, blow their brains out and be like, this could be you. Yeah. Stay away from crypto. We don't want to be a real unfortunate if that happened to you.

like it was like genuinely to send a message they would go off to people that they thought that they could roll um that wouldn't fight back and they would go and just skull fuck them and then like read about it it was they went off they went after like unislop and stuff too right like so well sorry yeah just to be clear they went out but they but remember they would they would set this up right yeah this again this is very tactical they would go after someone for something that they were planning to then leverage with a bigger protocol. So they would go and get the win and have someone roll and, you know, go, like, I don't have the money to defend myself against this thing, like score, right?

They would settle or whatever. The settlement means nothing. But then they would go and take these settlements and show up at the door of like, Yiny Swapar Ave and be like, listen, look at all this precedent that we've got here, of your friends that we killed. we're coming for you, right? And obviously, Unisop's not retarded. They would be like, eh, that's not precedent, guys.

That's just like, you killed a bunch of people. You have to have really good lawyers for that. And, like, you have to be eager and willing and good lawyers and that those guys cost money. Yeah, I think that's what we learned this cycle is we used to do these like dala workarounds. But this cycle, we just pay lawyers. It's not the worst upgrade. Yeah, it's not the worst. It's not the worst.

I mean, like, I'll pull my hand up and say, like, I was like, I don't know that we need lawyers anymore. I think we've solved the law. And it turns out that was, that was maybe a little, a little early to call that one. So, yeah. But I do want one little, so I have one little note on this. So because they're literally messaging people on Monday being like,

you have an open approval, you have 12 hours before the proposal goes, right? revoke cash using Metamask. Metamask ship something, guys. Amazing. Count out Metamask, yay. So basically they're using the Metamask permissions, which is like the new, these new, it's like the Delegator, Gator, the 7702. It's all the new like smart, not smart contract,

but smart contract stuff. So you can now, via revoke cash, I think it was so cool. via revoke cash, you can give them permission to revoke your open approvals. Does that make sense? Wow. Yeah, nice. And so now if we find out that like Barnbridge is about to get back and all the open

approvals, you can work with revoke cash and be like, you know, everything's verified. And then anyone who's basically given revoke cash the authority to like auto revoke their stuff, it'll just happen automatically. Maybe I'm just weird But personally in my wallet In moment I do something I revoke immediately Like even if you have units

So I don't know Like don't have any open approvals ever For anything Yeah but that's not That's not real life though That's not how people are And there's a lot There's a lot of interfaces

That just like Yolo Max approve everything Nowadays they all do Max approve I was I was something on a I'm not going to say which one Because I don't want to follow it but whatever. Infinite approvals.

Infinite approvals. Yeah. And UI wouldn't let me continue unless I did infinite approval. Yeah. I'm like, guys, come on. It is. And you used to be. Remember, a lot of this was because of gas.

It was because of gas. Like, it was literally like gas was too, the price of gas is too high, too damn high. So we had to do all this nonsense and it costs us so much more money. Yeah, exactly. So I'm excited for this. I think this is one of the first. use cases, sort of like loki use case for the permissions, right? We're delegating a very specific permission or authority to a third party, right?

You're just allowing this third party revoke your open approvals. That's it. Nothing else. And if you're willing to do that, you sign once and then they can do that. But they can't spend your money. They can't open approvals for you. You know what I mean? They can just do this thing.

And that's like, I don't know, we've been talking about this for a decade with like support contact wallets. And I don't know. You'll look at remote cash guys. Like, we're doing the things. I'm so excited. Okay. Things are hard. There's a lesson there.

It's hard to do things. It takes way longer than you think. Like, it's hard to do things. All right. Allsteum. Let's wrap it up with all steam. Give us the quick rundown of all steam. I got a funny story about

I'll see him, but you tell us what happened first. So, there was a private key. There were multiple private keys. And then the hackers got the private key. And then they stole all the money. Yeah. How do they get the keys?

They don't know how they got the keys. This is the same story every week now. Oh, man. I will, okay. So I'll give you the end of the episode. I'll say we have not attributed this to a specific threat actor whatsoever. However, since I spent eight hours tracing this shit straight yesterday, nonstop, and they did not stop. And I could not keep up.

That is a pretty strong indicator that is probably someone in North Korea who's doing this shit. And guys? Louis-O-Yo. Yeah, because eight, I mean, dude, for eight hours. They, and they just, by the way, I had to take a shower and, like, do other things in my life. They kept going. I could see the address was flowing. And I woke up and they are still going.

So, oh, it just sucks. Once again, a reminder, guys. Key Man, Grant. Multi-Sigs. Multi-sig. Where your keys are stored. Who has access to the keys? Where they are.

Anivirus. DDR logs, turn your logs on. So if you're running out of companies. All of these basic things. You know, obviously when you have sophisticated threat actors, they can, there's always like this thing where you're like, they could do this.

Like that's not going to protect you perfectly. Like you just, like, we have to raise the bar. You got to mitigate. Mitigation. Mitigation, mitigation. Like there's like, you just have to be not the slowest runner when the bear is coming after you. That's it.

Once the bear gets the slow guy, you're good. Yeah. And it's, I think they, they basically got all the money. There's actually a little bit of money left, but they basically got all the money. So it's about, my account was like 23 mil. And I think there was like one other wallet that somehow couldn't be hit or whatever that had 7 mil in it or 9 mil. But, and it's basically already laundered. Like, again, it just sucks like to watch this.

and just how fast they move, all because of ease that existed, that shouldn't have existed. I think as a builder in the industry, you just have to start with the fact of any EOA that you use is already compromised. If you don't ever trust any EOA ever, then maybe that'll help you when you're designing your systems, whether it's in control of whatever functions, that you're saying, hey, this is already compromised? is that going to affect us in some way? I think that's a good starting point, but the amount of builders who still trust, whether it's because of convenience or ignorance,

that their hot wallet is going to be able to do some administrative tasks on their platform. It's amazing to me. It's like every single week, it's the same story over and over. Somebody gets their private keys. You know, you go on a Google interview with somebody. or something like that. Oh, like, they sound like cane

and you're like, oh, maybe it's my connection. I got to download the software. And that... It was crazy. I used to, when there was like a lot more DFI protocols, I would always just do the B-Fee finance check. There's like this different things that you have to do if you want a B-Fi-finance to integrate you.

And the number one thing was, okay, all admin functions need to be secured by a multi-sig. Pretty simple. And so I, maybe just me and Wester, But I thought the standard was multi-six always for admin functions. It is. But then, you know, like complex systems, like this is, you know, there's a, there's a concept in like complex systems, like a normal accident, right? And, you know, you have all of these like fail safes and mitigations, but you're running a nuclear reactor at Three Mile Island, right?

Right. And one day there's like a mouse or something and the guy's like, I'm just going to prop the door open. Right. And they prop the door open and then air conditioning fails in that room because they can't fucking switch on. There's like something that the temperature goes. And then it's like this cascading thing where like all the fails. And you know, if you have a complex system, uh, that's running for long enough, right? And people are involved. Entropy just gets you. Right. And I'm sure. sure that this like price upkeep forwarder thing was like probably not set up the way that it is now and someone's like tweet something like I'll just put this as like an interim solution then we'll replace it and it's only going to be a temporary thing I'm just going to prop the door open overnight just to like make sure that the mouse doesn't fucking get in or whatever the hell the problem is or like there's birds in there I read three mile island there was like birds were pooping and so they're like, oh, we're going to, like, put this sheet here and then, like, I was like the thing.

Yeah. Meltdown. Yeah. Yeah. Like, it's, you know, humans go, oh, like, what could this grate be here for? It's like, oh, that's the water slush grate that, like, allows the water to come in and like, cool the thing. And you're like, you don't know.

And you just cover the grate because you're like, want to stop the bird poop from getting through, right? And here we are. Yeah. So, like, I just, it's so hard. So hard. It's so hard. it's yeah and you have to just have to be disciplined and this was a case where

maybe i undersold it a bit but like the private keys that were compromised was like those controlled the forward or the oracle or whatever which then right it wasn't it wasn't like the the hot you i had all the money and it's where you just get yeah exactly yeah but this is like but this i'm sure that connection this wasn't connect like you know it's it's just the other thing is right It's one thing you're running a complex system, right? Okay, cool. You're dealing with entropy, right?

But you're not probably dealing with adversarial humans that are like sending an email to the maintenance guy being like, hey, there's birds pooping, like cover the grate. Right? Because they know like literally that's what we're dealing with, right? Like it's like, you know, it's so much harder when you have like people that are like getting the the schematics for your nuclear reactor, and they're like, okay, I think I've found one flaw in this system where if I can get someone to flip this light switch

at the right time, then the whole thing melts down. And like, that would never happen, but you have humans that are like actively probing and trying to break in, right? And so, like, therefore, the level of defense in depth that you need is just so much higher, because humans are smart. Those North Korean guys are smart, unfortunately. It's so hard. I actually kind of think about it as like,

think about all of the times that your information gets stolen, you know, from like your cell phone provider, your TV provider, your, you know, whoever you gave your information to, you know,

sign up for an account somewhere. It's stole all the time, right? And for us as a builder, it's like, well, that's just data. Like somebody's stealing your data. Now it's sensitive information.

Somebody's impacted. They go, hey, I'm sorry. For us, it's like, hey, you know,

We made one little air, $25 million. Yeah. It's the amount of like blood pressure rising that you get as a builder in this industry. It's like every morning you wake up, you check. You're like, I hope nothing bad happened. You know your whole concentration is. Yeah, your whole concentration is focused on security, like making sure that people don't lose money. We never lose.

Like you're basically thinking about like how is somebody going to attack me at all times, right? but there's always something you can miss and so you live with that I feel like we have a lot more tools I feel like we have a lot more tools I'm always feeling hyper native to everyone for some reason but there's so many tools that we didn't have before

I also think like the code's getting better so like in general we're seeing a lot less I think code related bugs that are being exploited and it's a lot of just like human error private key management sort of related issues which I guess is good, right? Because it means at least the code level strength is getting better.

But still we got to figure out how to secure our system better. Yeah. I mean, in theory, for me, in theory, the private key, like admin, like, feel like it's solvable. We've actually seen, like, the centralized exchange of go from. It's so like. Yeah. But we have to actually execute. Yeah.

Once again, where the code ones, I think, often felt. like really like impossible. But I do think that's why crypto in general has spent way more time and energy trying to solve the quote unquote unsolvable. Like these crazy like logic vulnerabilities in the code. And they're like because yeah, infra like basic obsec is solved. But it's actually not solved.

Like the majority of money loss this year so far has been basic. Basic ops like. And so it's yeah, it's not that it's, it's not that it's unknown how to solve it. Like, we know how to solve it, but we completely failed to do so again and again and again. And... What can you do other than sign or...

We know the illness, we know the medicine. It's just kind of we refuse to take it. Yeah. We were sitting in the bath last night after tracing for like, literally eight hours, are sitting in the bath. And I was just like, oh my god i can't i can't believe i did that again like it's just it's exhausting you know and you

and i think the worst thing about hacks is that once you're like once the hack happens like once it it fucking goes you're just sitting there responding and trying to mitigate and trying to do literally anything after the fact and there's all you can spend so much time and energy at that point you can go all in, you can literally sit at your computer and raise all the funds and make phone calls and, right, full favors do all this stuff. But at the end of the day, like none of it really has a huge impact, right? Like we got some funds frozen, but like nothing huge. There's just not like, and then you're like, wow, we just spent so much energy. So many people's lives got upended.

The builders, right? These guys were building. Now they're fucked. The users. Yeah. Right? We're going to have to figure all this out. So this is the funny story, right? So, Osteum, we had a synthetics event in New York in like 2021, I want to say.

And it was like, I want to say 1 a.m. or something. And so it was like, oh, hey, these kids want to meet you. And I was like, okay, cool, whatever. I was like, I'm kind of off the clock at this point. Like, I've done my meeting and greeting. Like, I was probably like, high of ketamine or something. But I was like, yeah, sure, whatever. And so these three, there must have been like 18, 19.

They were like super young kids, like front up. And they're like, hey, can we ask you about synthetics? And I was like, it's like 1 a.m., but sure, like whatever. And then proceeded to have like, I swear to God, like a 90-minute conversation about like all of the mechanism, design, whatever, like, why we made decisions that we did. it's now like 2.30 the morning. I'm like, can I just go and have fun?

Like, please. I would just like, let me live my life. And they're like, I was like, what's your deal anyway? Like, why are you guys so curious about this? And like, oh, we're building like derivatives protocol. And it was the Osteam guys. And I was like, oh, cool, good luck with that. And I literally said to them, I was like, honestly,

if there's like one like piece of device, because it's 20, like probably, again, I want to say like mid-21, I was like, Honestly, my advice to you is like, don't. The amount of pain and suffering that you're going to go through, if you do this is like, it's just not worth it. Like, do something else with your lives. Like, it's so fucking painful to build in defy.

Like, you have no idea. And, like, then, and like, I've met them multiple times. And they're like, we still talk about that conversation where you're like, don't do this. And, like, we did it and look at how well it's going. And it's like a... I mean, not... You have to do it out of ideology.

Like, if we're here... Exactly. We do it because we fundamentally believe this is like... Believe it. Exactly. Yeah. This is why I think this is why like these incidents just like pain me so much, right? So that's 2021.

I think they like officially launched in early 2020. Okay. After ignoring... By the way, I stop ignoring King's advice, guys. That's the lesson of this episode. King is always right. but they did right they fucking said no fuck you came we're gonna fucking launch this shit in 2022 they launch they build it up they survive they i'm sure it took an immense amount of

effort right the 2022 22 23 2024 2025 and halfway through 2026 they built all that and then one freaking mistake and it's gone and like hopefully they were my neighbors so we had another office before this. Very famous, like office, a lot of people are there in crypto. And literally my neighbors in front of me. So I could see Caledore and her meetings every day. Those guys worked super hard. Yeah.

And so it's a shame. All that work. Yeah. And it's, I mean, like, they might, they might, like, people recover from worse hacks. Like, it's possible that they, they recover, you know, especially when you got that long of a track record. But it's really hard. It's really hard. It's going to be, you know, like, it's,

it's you know like the oiler guys like it took them two years to grind their way back and you know it's going to be a long hard road back like had a major hack and they came back well in other words that was a trap right that was think the kelps wormhole

helps if you've got billionaire friends to yeah yeah it also it depends a lot on like timing it depends on the team Euler I mean Euler was I would put Euler in a league of their own they for one they managed to get money back, which is super rare, but that was like, yeah.

I still don't know how Michael did, but like he did, it's, it was, that team was, assassins. They're like, it's the ownership over that, like, they got fucked, right? And the ownership over that team to like, be like, no, we are not accepting this outcome. We don't accept this. I know. I remember talking to Michael and I was like, this guy's, like, insane. Like, after it happened, right?

Like, we were talking about it. maybe like two three weeks later and he's like no no no we're like this will not stand it was like it was like the it was like the taken guy right like it was like i've built up a you know set of fucking skills over my career i'm gonna i'm gonna hump these guys down and they did it's nuts it was no but literally and not energy rubbed off on all i mean i i worked that case for way longer than i would work any other case because i was like oh but you're like these guys it all in. Yeah. They're all in.

And I kept looking and they kept playing. They remember they had the whole language hack or something like they had was a hack but they found the money almost immediately. Hey, did you like participate in that? That was.

That was a viper bug, which is, that was scary. It was. Yeah, that one was, that one scared the shit on me because I was like, oh, you can have lower level bugs. Shit. Yeah. It's so over. He's like, oh, Jesus.

Compiler bugs. Now we've got a whole new, we've got a whole new problem to deal with. All right. Let's wrap it up here. We're way over. Thank you guys. I appreciate you jumping in. This was really fun, despite the New Zealand induced, or maybe vibe coding induced.

I don't know if I blame my machine or the country. of New Zealand, a bit of both. But yeah, thank you very much for jumping in. This is a great episode. I really appreciate the time. Thanks everyone for joining us for this episode of Uneasy Money. Remember what happens on Chain never stays on Chain. We will be back next week until then do your own research before aping in.

Nothing you hear on UnEasy Money is financial advice. We're just three builders talking about what's happening on chain. And we want you to always do your own research before aping in. You can find all out of disclosures at Unchain. at all com slash uneasy money.