Unchained - Why Would Argentine President Javier Milei Protect Kelsier's Hayden Davis? - Ep. 787

Episode Date: February 21, 2025

What started as another scammy memecoin launch has spiraled into one of Argentina’s biggest political scandals. The $LIBRA token, promoted by President Javier Milei and tied to Hayden Davis of Kelsier Ventures, is now at the center of multiple investigations—with allegations of bribery, insider trading, and political corruption. Some are calling it “CryptoGate.” Did Davis really have influence over Milei? Was the president’s sister involved in pay-to-play politics? Could Davis and Milei face legal action? This week, Danny Nelson, managing editor for data & tokens at CoinDesk, joins to reveal what his reporting uncovered, from secret deals to political fallout—and why this scandal could change how people see memecoins forever. Show highlights: 1:47 How Hayden Davis was bragging about his connection to the Argentine presidency 9:15 Why Karina Milei holds the keys to her brother 11:31 Whether Milei is trying to protect Davis 16:22 Whether Milei was an ignorant victim or a more knowledgeable participant in $LIBRA 18:46 What charges Davis could face in the U.S. 22:00 Why Danny thinks Jupiter is taking the right step 24:34 Whether a memecoin such as $LIBRA could be considered a security 29:32 What Davis should do with the $100 million in his possession 33:40 Whether memecoins are now dead 38:41 What the future of Pump.fun looks like Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com Thank you to our sponsors! Mantle Guest Danny Nelson, Managing Editor for Data & Tokens at CoinDesk Links Previous coverage of Unchained on the LIBRA scandal: How the Libra Scandal Exposed Memecoin Insider Trading on the World Stage Bits + Bips: Could the LIBRA Scandal End the Memecoin Craze? Unchained:  LIBRA Insider and Argentinian President Holding Secret Calls Meteora Co-Founder Resigns Amid LIBRA Scandal Are Memecoins Collapsing? These 8 Charts May Be Signaling Yes CoinDesk: Libra Token's Hayden Davis Bragged of Influence Over Argentina's Milei Coinbase CEO Brian Armstrong’s post on memecoins Learn more about your ad choices. Visit megaphone.fm/adchoices

If there is genuine evidence of insider trading, of using information that someone knew that the general public traders didn't know, then you could have cases brought even if Libra isn't seen as a security. That's something that a lot of people get wrong in crypto, right? There are statutes in the U.S. federal securities law that expressly prohibit insider trading of securities. Now, that doesn't mean that if it's not a security, you can't be charged for insider of trading. If you use information to trade an asset, a commodity, whatever, and that information

wasn't public, but you knew it, then you could be charged for wire fraud. Hi, everyone. Welcome to Unchained. You're a no-hype resource for all things crypto. I'm your host, Laura Shin. We are now featuring quotes from listeners on the show. Today, we have one from Mark Soros on X. Responding to my interview with Diokas about the Libra scandal. Mark writes, quote, I feel like meme coin as a term is the wrong one to use for these types of tokens. These are rug coins. There's nothing memeable about them. To have your comment featured, write a review of the podcast overall or leave a comment on our video on YouTube or X. This is the February 21st, 2025 episode of Unchained. Mantil is building the future of Onchain

Finance. Experience its enhanced index fund, Mantle Banking, and Mantle X. Visit Visit group.mantle.xy-Z to learn more. Today's guest is Danny Nelson, managing editor for data and tokens at CoinDesk. Welcome, Danny. Good to be here. Just a quick heads up, everybody. Due to schedules, Danny and I recorded on Wednesday evening. So if there are developments that happened on Thursday that are not mentioned in the show,

that's why. The crypto world continues to be rocked by the Libra scandal, which is probably the first time in crypto, and in this case it's a meme coin, that has caused a national scandal that also sparked a drop in that country's stock market. Danny, you broke the news this week that Hayden Davis of Kelskier Ventures had been bragging about his relationship with Argentine President Javier Malay. Tell us what you found. Yeah, so I've found that this guy who had already publicly come out and said that he was behind the Libre token, and that's about being Hayden Davis of Kelsior Ventures.

He had thrown on this weird media junket that honestly reminded me a lot about SBF's reaction after the fall of FTX. He went on this media junket where he basically said, I did nothing wrong, but there is all this money that I seem to be in control of,

around $100 million that he amassed because, or through the launch of the Libre token, and my understanding, selling his own stash of Libra tokens, Now, this thing went horribly wrong, as your listeners probably know from the episode you did earlier this week and just from watching the story unfold on crypto Twitter. But what I found in my reporting was that Hidden Davis, months before the Libra token actually came to light and crashed, was bragging about his access, as you say, to Javier Millay, to other people in the crypto ecosystem. And what that meant was he was basically saying that he had bought access to the president. Now, it's important to note that we have no hard evidence or supporting evidence that any bribes were paid or payments were exchanged.

I think that's very critical for everyone to know. And Hayden has said now that he did not make any payments. But for one reason or another, he was bragging about this access. saying, I control the president and I can get him to do whatever I want in the run-up to this. And the reasons why he was doing that, it's difficult to know for sure, right? Why would you say that you're doing something that you're not actually doing? But it certainly doesn't sit right with the wider crypto audience, especially with the figure reckoning that we're all going through right now about insider trading and meme coins and

right and wrong. You know, this is just another, another brick in the wall, I would say. Yeah. Well, as you were doing your research, I don't know how much you dug into his past, but based on that, like, do you, would you just make a conjecture as to whether or not the bracking was not based in fact or whether it may have been based in fact? Well, you know, I don't want to say that anybody paid a bribe or didn't pay a bribe because I don't know for sure, right? I just legally, I don't want to accuse someone of doing that. But I will lean on what Hayden said he was doing. And at the very least, he was claiming to.

I've heard from other people that I've spoken to that this guy was positioning himself as something like a fixer to the Argentine crypto world telling projects, if you want to have the access that you need, then you're going to go through me and maybe there will be some exchange of money. Now, I don't know if that money was one of our exchange or two, if Hayden would then go and bribe officials or something like that. But again, as per my reporting, he was at the very least bragging about having this access that seemed to be based in payments. I send cash to his sister and he signs whatever I want. Yes, that's our understanding to Javier Melaide's sister, and he being Javier Malae, the president of Argentina, does what I want and signs. It signs what I want and does whatever I say. That's what he wrote in text messages.

So, you know, at the very least someone who is very brazen about his claims of access, because that is not the way that I guess you would say a traditional lobbyist would comport themselves. For sure. And the other reason that text messages were so scandalous, is because he said, I control that N-word, and in that he was referring to Argentine president, Malay. So not the way you would typically talk about a world leader. No, no, not at all. I think, though, that it feeds into or it supports in understanding that we have of the way that Hayden was carrying himself.

And I think, honestly, it's very representative, even though we don't, it's a very bad word and people shouldn't be using it. But I think it is representative of the way that a certain portion of the meme coin trading, the trenches carry themselves, right? There is this perception broadly that meme coins are a really effective way to extract that, to accrue value, extract value. and especially if you are the ones who are creating them and positioning yourselves to have easy and early access to trading them so that you can either go into the launch with a trove for yourself, as seems to have been the case here, or you can snipe them early and then sell quickly, not because you were savvy and had the right tech tools, although some people do, but because you had access to information, to insider information that other people

don't. And I think that the language that he used is representative of that class of the crypto community, because it is part of the crypto community, whether we like it or not. And it's, I think, something that we should just continue to consider when, you know, this broader reckoning that we seem to be subjecting ourselves to with whether meme coins really should be the future of crypto. For sure. You know, just one last. last note about his character, I saw that defi-tuna, who I guess, you know, was working on like a meme coin launch pad with Kelsier. They released her, or I don't know who originally released this, but, you know, obviously it was probably somebody at that team because I don't

think Hayden Davis of Kelsior himself would release this, but it was a text exchange about another meme coin they had worked on together called Mates. And Hayden said, yeah, fellows, to be honest, we are trying to max extract on this one. So, you know, it just goes to show kind of how, what his approach was. Yes, exactly. And there's all, you know, in crypto, we have this concept of MEV extractable value. It's all about how do we squeeze things out. And in some cases, that is how systems are designed. In Ethereum, when you're packing blocks and things like that, it's the system is set up in a way that you can have these. these bots that go into the mempool, look at the transactions, order things in a way that is

beneficial to them. And that's, it's neither good nor bad. It's just how the system works, right? But then when you, when we apply those, that same logic to meme coins, it's less so about how we're building a system, how we're building a decentralized system and more what individual people are doing to enrich themselves at the, I would say, at the expense of other people. And that's when you get into things like max extract value with beam coins. So now let's also talk about Karina Malay, who we mentioned briefly. What role does she play in the Argentine government? And what role does she appear to have played in this scandal?

Yeah. So she is the sister of Javier Malay. She's a very important figure in this government. I believe that her title is something like Secretary General. She is, for all the time of purposes, best understood, though, as a gatekeeper. to Javier Millais, someone who's in the inner circle and someone who can get access to Javier. Like, if you want to talk to him, then she is a very good person. I'm not in Argentinian. I'm not an expert in Argentinian. I'm not an expert in Casa Rosada, which is what they call their White House

there. But she is a very important person in his administration. And that's the place where we need to start this understanding. Now, in the Argentine press, there has been some reporting that shows that in the past, she was the one that was facilitating conversations between Millay and people like Hayden Davis of Kelsior, other people who work at Kip Protocol, which also played a role in the Libra launch. And at least according to Hayden, he says that in his text that we reported on, he said that he sent her money and therefore the president does what he wants. Now again, I just want to say, we don't have evidence that any bribes were paid. He has said after the fact that he never paid bribe, he never paid anyone and though it was

never asked for money, you still, though, have to go back at these, and look at these sex messages. Why would someone say that if they don't, why would you say something like that if you don't mean it, in some way? Yeah. So in a moment, we're going to talk a little bit more about the relationship between Malay and Davis generally. But first, a quick word from the sponsors who make this show possible. Mantle is revolutionizing its on-chain financial hub. Powered by a $4 billion treasury and proven products like Mantle Network and Emmeth Protocol, Mantle is launching three innovation pillars, enhanced index fund for optimized crypto exposure, Mantle Banking for blockchain-powered banking, and Mantle X for AI-driven innovation. Experience the future of finance

with Mantle and follow Mantle on X to stay tuned. We have a few other comments responding to the Libra Scandal episode with Diokasaurus. On YouTube, 2010 BTC Yep writes, The Assassins are Coming, Insiders went too far. This story is just getting started. They are extremely scared. They should be. All of the names we know are jerking us all.

All of our favorite devs all. Stay the F out of memes. And on X CryptoSnooper weighs in, Hayden is doing an SPF media tour. Again, if you want to hear your comment featured on the show, please write a review or leave a comment on an episode on YouTube or X. Back to my conversation with Danny. So La Nacionalcone in Argentina has been, I mean, really all of the newspapers there have been

publishing up a storm about this. But they reported that Malay has been having secret phone calls ever since the scandal broke with Davis. And one of them, he promised Davis that in the televised interview he was doing Monday night that he would not accuse Davis of doing anything illicit. So I was curious, you know, what you had gleaned about their relationship. Like, you know, do you think that it is likely true that they are having these types of conversations and what does it say to you if he's trying to promise these types of things to Davis? What does it say to about their relationship?

So if you look back at the start of this week, or I guess it was over the weekend, I don't even know, Hayden Davis has done a couple of videos. He's done his first video where he showed up wearing his very broadest older sweatshirt, everyone means about it. That was his own like telling of the facts. He then did a call, an hour long call with Coffee Zilla, which had a lot of moments that made people scratch their heads and think, why are you saying these on tape?

Like admitting to sniping his own meme coin, just generally making other statements that could be construed, some people as potentially not up to snuff with the law. Then he also did a call with Dave Portnoy, which was even more of ridiculous. There was a point where La Nacione was talking to Hayden, and then all communications stopped. And at least according to their reporting, what seems to have happened is that he was, Hayden was told by the government of Millay, by the Argentine presidential administration, stop talking to the press. Stop going out. Stop going out. and saying things. That's a very believable thing for them to have said because I don't think

it's ever a good idea to try to clean up one's own mess. You need to think no further than SBF, right? He tried to go on his media tour after he, after FTX collapsed. And in court, a lot of the stuff that he said on TV and to the New York Times and all that, that was used against him. So just a general thing, you should never try to talk your way out of a hole. And according to La Nassioen, that's what they needed him to stop doing. I don't, I haven't, I don't have my own sourcing on those secret calls. But yeah, according to La Nacian, they have continued to have these calls. I think that it, like, it is incontrovertible that there is a relationship between Hayden as Kelsior and Javier Malay.

And it goes back a long time, well, in crypto a long time. I have people telling me that as late, like last year in the summertime, he was, already understood to be someone who knew his way around the administration and had contacts. And then with this, there was an event in October called Tech Forum Argentina that a lot of crypto people went to. Charles Hoskinson went there, a couple other important people in crypto went as well. And Hayden certainly was there too. And at that event, he was positioned himself as someone who had the inn on the Argentine government. So that was in October. You get to December. That's when the text messages that I reported on were sent.

And now you get to hear. So I totally do believe that such conversations would necessarily happen because this is sort of a boat that, well, a boat. This is an ocean both of them are swimming in right now. Hayden and Javier Millay. They both have their own crises. I would say that Malays is even bigger at this point than Hayden's because he is facing calls from the opposition to face an impeachment

trial, facing multiple inquiries. And according to the Argentine press, which have coined this crypto gate, that's what they call it. They call this crypto gate. This is the biggest crisis of his administration. And so, yeah, this is a sticky wicket, for sure. Yeah. Well, honestly, so when I did that interview with Diokas on Tuesday, he kind of, he had the impression that these meme coin traders had taken advantage of Javier Malay. But then now that I'm hearing about the secret phone calls and Malay promising, Hayden Davis, that he won't accuse him of illicit things, et cetera. Now I'm wondering, do you think, so do you think that Malay's understanding of what he was doing when he promoted that the meme coin, which essentially launched the

meme coin, you know, because the address wasn't known before. So do you think that he knew, or do you think he was the victim of these opportunistic insider traders? Well, so let's look at that. So Javier Belae is a very unorthodox leader. Some would say that the leadership style and the zealousness with Litzby-Cuts programs is important for a country like Argentina that has a lot of inflation issues. He kind of need someone thinking differently, right? But beyond that, on his social media pages, he's very active on Twitter. It's very active on X.

And he has posted many times about private business ventures. So when you think about that, it wouldn't be out of the ordinary for him to promote a private venture. It is notable that it's a crypto thing, but it's not out of the ordinary that he would do something where he, his megaphone focuses on a private venture. I doubt that he's ever created a phantom wallet, gone on pumped up fun and lost some money. I don't think that he actually has experience with crypto. And so when you think about that, he probably isn't an expert on these things. I do think, though, that he was, there was a part of it where he was taken advantage of. I do believe, like, I don't think that he would have gone into this had he known that there would be, that the people that he was working with were so well placed and so intent on seemingly extracting value from the project of their own.

So I think that on that regard, he was taken advantage of. But you know, you read these press reports about how he's saying, I'm not going to call for any charges against you and things like that. And you do have to wonder, okay, well, what is the true extent of the relationship here? Okay. And I did see that it looks like there might be some legal action here in the U.S. Like I saw that a class action lawsuit is being prepared. Do you have a sense of what other...

So, you know, as you talked about, Malay is perhaps facing impeachment. But on the crypto side, there's, you know, Hayden Davis. We can talk about some of the other characters. But let's start with Davis. What kind of legal trouble do you think he might be in? Yeah. So at the least, I believe that Berwick law, which often prepares class action suits, I think that Berwick Law is forming a suit against them, against these actors to pursue damages for the money that people lost.

And I think that you mentioned before we began recording, or maybe it was during that even now, that Nansen said that a quarter million dollars, a quarter billion dollars was lost in this thing. So yeah, there's a lot of people who lost a lot of money. That is on the civil side. On the criminal side, I don't know. If there were bribes paid, then you could see something like the Foreign Crout Practices Act be brought into play where someone is charged for bribing for officials. Again, we can only go by Hayden's words on that front, but that is something that someone who pays bribes may face in the U.S. You could have on the meme coin trading, if there is genuine evidence of insider trading, of using information that someone knew, that the general public traders didn't know,

then you could have cases brought, even if Libra isn't seen as a security. That's something that a lot of people get wrong in crypto, right? There are statutes in the U.S. Federal Securities Law that expressly prohibit insider trading of securities. Now, that doesn't mean that if it's not a security, you can't be charged for insider trading. If you use information to trade an asset, a commodity, whatever,

and that information wasn't public, but you knew it, then you could be charged for wire fraud. And people will shorthand call that insider trading, even if it isn't the same statute. So that's something that also could be brought against someone who does insider trading. You know, beyond that, I don't know the Argentine legal space. We have Malay, at least reportedly, saying that he's not going to call for any action against Hayden. I think that Casa Rosada opened up its own anti-corruption investigation into Malay to understand what was going on in. We'll have to see where that shakes out. That could result in any number of things against the president or the people in his inner circle if they do find evidence of fraud or

bribery or whatever. And just to be clear, so earlier, for my earlier episode, we reported that actually he had announced an investigation into the incident. Javier Malay had announced an investigation into the incident. And Dia was saying like, oh, that's sort of like saying I'm going to, I'm going to investigate myself. But is this a separate one or is this the same one? Oh, so yeah, though the investigation that I was referring to, what is the same one, Casa Rosada being the White House. I saw it. That's just how I saw it in the press saying the administration opened this up. But yes, there is that element of how can we trust one's investigation into oneself, right? It better to do what Jupiter is doing.

Jupiter being another player in this story because Meteora is a salonabase project that prepares automated market makers for tokens. Basically, the infrastructure to support token trading now, they don't seem to be implicated to the same degree as other people in this whole thing. But the head of Meteora Ben Chow did resign his post for what Jupiter's meow, the guy who's seen as the figurehead of Jupiter, has said was a lack of judgment because of, I guess, the ease with which he approved the contracts for these things. Now, again, people, there were, no one is accusing Jupiter to my knowledge of trading, of insider trading. But Jupiter is now investigating what happened. and they're doing so by retaining the law from Fenwick and West.

So right there, that's a degree of separation, right? You're hiring someone to investigate yourself. That's a little bit better than the presidential administration having their own one. But I get to return to your point about investigations. I believe that today there was some talk in one of the Argentine bodies of Congress that there would be calls for another investigation that would be conduct. by that body. I don't know if the votes were there to actually start that, and I don't know the scope of that one, but there are many different investigations that are being opened up into this

whole thing. So yes, there is the president's own investigation. I think there will soon be other ones in other parts of the Argentine government, too. Okay, yeah, a couple of comments. So one is a small one. Just people might have heard this name Fenwickman West before, And it's because that was the law firm most familiar with FTCS and Alaminesis operations before their collapse. So people were begging Jupiter's meow on Twitter to not go with Fenwick and West. And I also tweeted something like, because I just took a screenshot of the top things that come up when you Google that. And yeah, it's saying like, you know, they had the most knowledge of what was going on in there. But then the other thing just about the, you know, insider trading.

laws being quite specific to a certain type of asset. I did have the thought. So I know, obviously, David Sachs, the newly named crypto and AIs are, yeah, he did call mean coins collectibles. However, because the test for whether or not something is a security is what they call facts and circumstances based, I could see that the facts and circumstances of this one with, you know, only a certain small number of people, basically being in control of the fate of this coin, I could see that causing it to, even though it's, you know, being billed as a meme coin, like actually being thought of in the U.S. legal system as a security. And really, that's what caused it to crash is that Hayden took out like too much liquidity and it crashed the price.

Yes, exactly. Before Malay, you know, removed his tweet. So. Yes. Yeah. I think that is what precipitated the fall of this, right? I think that the chart may have looked a bit more like Trump where it soared, it's for days and it's sold off over time. I think that we may have seen something more like that. And that's certainly what a lot of people were expecting, right? When they piled in, they thought, okay, we've seen this before. Let's go.

What they weren't expected were key players within it would act so, I would say, brazenly, to get their money off the table so early. Max extract. That is true. And yeah, with the meme corns in, whether collectibles are, whether they fit into the securities law. One, I think that under the Trump administration, everyone even before Trump took power would think that there wouldn't be any new cases that would attempt to expand the SEC's remit over something like meme coins. I think that's even less likely now because of the

Trump token, right? The coin that Trump himself promoted, notably on the topic of language and what we call these things. The Trump token on the website, they don't ever call it a coin. They only ever call it a meme or a card. Like you can collect a Trump meme. You can collect one card. So that makes it sound like it's an NFT, what really it is a token. They just calling you that. I think that that is because their understanding of the law, not that it matters since their promoter is in charge of the law. They have decided that it's best to brand this as a collectible. as David Sacks says. And then I guess the legal logic is, if we're collectible, we're not a security.

Yeah. Yeah. But yeah, what you call it and what it actually is are two different things. I don't know. They may not know that. Well, on his interview on Monday night, Javier Millet said on Argentine television, I didn't promote it. I shared it, right?

Again, it's where it's a breakdown of language. Okay, you shared it, buddy. you tweeted a contract address and said, I like this thing, it's going to support small businesses. You are promoting it, right? Sure, you're promoting it through the act of sharing it. But it's like a language, we're getting to a point where language doesn't actually, it loses its meaning at this level.

Yeah, I wish George Orwell were alive. He'd have a field day with this. Oh, goodness. I think that if George Orwell were alive, he would lock himself in a room and begin to cry at this point. Well, one other thing that I wanted to ask you about was you mentioned the Foreign Crub Practices Act earlier. Trump suspended that on February 10th. So this was four days before everything went down.

So I don't know how this works. Is it like because all the plans had been made, like let's assume the plans had been made before, then would it still apply? Or is it like because it only got tweeted on the floor? Anyway, maybe it's not an important point, but I just found it so interesting. timing of that particular suspension. Yeah, I think that, again, I don't know if any bribs were actually, I have no evidence that any bribes are paid here. But I think that if Trump is saying that it's suspended, what he's really saying is not

the law is suspended. It's to DOJ, don't waste your time prosecuting this. So I think that whether or not the plans were made or money was exchanged beforehand in any situation, at least under Trump, nothing is going to be brought because he's, saying, don't bring cases like this, right? Because he can't actually suspend a law. What he can do is suspend the enforcement of that law. Okay. So if more information comes out, then I guess, like, assuming that Trump is no longer present, because obviously this is a second term, then in, yeah, four years maybe some prosecutor will want to bring a case against Hayden.

Anyway, well, question for you. I don't know if sources that you've talked with had any idea on what was the best way for Hayden to, you know, handle this $100 million that he has in his possession now. Yeah, I haven't spoken to too many people about the next steps. I think that the best resource or discourse on that point is the CoffeeZilla interview where, one of the two basically says there are a couple, I think it's Hayden, he says there are four options of what to do with the money. One, he gives it to Argentina.

Two, he injects it back into the chart. Three, he does some sort of refund for people. I don't remember what the fourth was. I genuinely don't know what will happen to that money. I think that it's unlikely that the money will just disappear because it's not being held by North Korea. But, yeah, it's a difficult one. How do you make things right?

According to him, people should know that when they're playing in the meme coin casino, they may well lose. And I would actually agree with him. If you're playing in the meme coin casino, you should have the perspective that you will lose your money. I think that is the best way to navigate that world. What I think that he was saying that is wrong is that, you know, his flippant attitude towards sniping and toward this insider information, I think that things like that, that stack the deck even more against people, that's something that we really

can't tolerate. And I think it's also worth noting that there are mechanisms in the Meekorn world that were set up to address at least some of these problems, like the problems of distribution and who holds the tokens. Pump.com, that fund, say what you will about them. At least on Pump. Fund, the token debuts to the market at the exact same time. And so everyone sees it at its earliest moments at the exact

same time, and then they have the opportunity to jump in. At that moment, there will be bots and snipers grabbing up liquidity, but the only thing stopping individuals from doing that themselves is their own technical ability. It's not some sort of insider information.

And that's not something that you saw with the meme coin launch here. This was created by individuals set up with supplies already earmarked. And as we've seen, with the $100 million that was accrued in a very short period of time, they were set up to max extract. Yeah. Honestly, this conundrum of what to do with the money now reminds me so much of the Dow where they had amassed $150 million in this contract. And then, you know, the hack began. But because it was so early in crypto, just like all these tools that we have nowadays, like they didn't even exist.

So people couldn't figure it because there were all these rules about like, if you want to leave the Dow, you have to have these different waiting periods. It was sort of like these like locked gates that would open after like seven days, 28 days, like, you know, whatever. And so when they had to hack the rest of the money to keep the hacker from getting the rest, so the hacker took 31%. and they took 69%. And basically, at that point, they,

sorry, sorry, they didn't hack it. The hacker got 31% and then just appear to not be able to keep hacking away at it. And at that point, they were like, well, we kind of want to rescue it. But the only way we can rescue it is to hack it ourselves. So if we do that, like we could be accused of stealing this money. So what they did was they waited until it looked. like others were trying to hack it. And then they could claim something about like exigent circumstances that like put the money

in peril and required them to to steal it themselves. But anyway, so yeah, it's like all the same discussion. Well, last quick question is just, you know, we, so we just published a story here on how the meme coin stats appeared to have been declining first, even just before like when the Trump meme coin launched. But now the last few days, like ever since Libra, they have been dropping. dropping up to 40%, like different metrics like about users or like the percentage of mean coins that kind of graduate out of pumped up fund into radium and stuff like that.

So what do you think the impact will be on the meme coin sector? Do you think it's like a blip and it'll recover or do you think this sort of like means the end of the craze? You know, recently on the Blockspace pod from Will Foxy, those guys are Bitcoin experts, They were talking about how we finally no longer see Bitcoin obituaries. Like FT and other newspapers, they're no longer writing the death of Bitcoin. I'm not going to be the one to say that we're seeing the death of meme coins that it's going to go away. Doge.

Dogecoin has been around for a very long time. People love trading digital nonsense nickels as a friend of J.P. Morgan would call them. And they're going to keep doing so. But I do think that what we're seeing here is going to be a pretty severe. cooling off of the beam coin sector, at least for a little bit, because of what we saw with first Trump coin, which really set the groundwork for something like Librecoin to really happen, the people who invested in Trump coin, a lot of them got runs by Melania coin, which also has Hayden Davis connections, which is crazy. And these very high profile moments where the meme coins

are seen by the wider world, but really much more so just by the crypto people and crypto Twitter, extractive events, I think that the enthusiasm for aping in and unloading full portfolio clips or whatever you want to call into these things is going to diminish. And if fewer people are willing to toss money brazenly at these things, then they're not going to climb the same ways. And if they're not going to climb the same way, so they're not going to trade as high. And if they're not going to trade as high, people aren't going to pay attention. So we're still going to see new meme coins every day at pumped out of fun.

we're still going to see graduations and we're still going to see people trading this. But I think that this is a very good opportunity to have the kind of conversation of what role do we want this meme coins are playing crypto? The beauty of crypto is that conversation is almost meaningless because it's a permissionless world and people are going to keep doing what they want to do. I think though for the short term, we are just not going to see the same volumes as you're already seeing, as you talked about, in the meme coin space. Yeah, yeah, it was interesting because it was like, you know, those different metrics I mentioned. But then the one that had fallen,

you know, a fair amount, but nowhere near as much was the number of new meme coins that were being launched. It was only 18%. Yeah, I saw that too. I'm dune. Yeah. It's down. It's just not down tremendously. Exactly. People are still trying to get rich quick. Yeah. And who can't blame them, Right. Everyone wants to get rich quick, I guess. But some people just are more brazen about how they go about it. Yeah, or like realistic, too. Like, you know, brazen and realistic. Yeah.

We saw today Brian Armstrong of Coinbase had a post on meme coins. I read it. I don't remember it verbatim. But he basically said meme coins are one of the signs of the increasing tokenization of everything. I think that he's onto something there. meme coins aren't going to go away because they are the lowest common denominator of on-chain trading. Like, let's just trade a thing. Let's trade what is a meme. A meme is a culture packet. I think that's actually what the definition of a meme is. A meme is a culture packet.

So meme coins are how you financialize culture packets. And it is, for many people, the easiest way onto crypto, but it is not the stickiest way. If you lose money, because your president tweeted out a meme corin. And you didn't ever touch anything in crypto before. How are you going to feel about crypto? Are you really going to read Satoshi's white paper? Jack Dorsey's white paper, maybe. Who knows?

You're not. And most people wouldn't know you know. Allegedly. So who cares? Allegedly. Alleged Satoshi. Yeah. I mean, yeah.

So I agree on all those points. The one thing that I also agree with, which is slightly contradictory, is just for somebody's first experience to, you know, jump into something like this and lose money, that's not a good experience. Oh, yes. No, it's terrible. Yeah, but maybe that's what you were saying, that like basically, sadly, when people get burned, then they lose interest in meme coins.

And so maybe that's how the craze dies down and the scams. One other thing that I wanted to mention is that Olaf Carlson, we, when he came on, he also talked about how in the future he thinks everything will be tokenized. And he said, interestingly already, there are people who are finding out what the news is from watching Pump.com Fun. Oh, that's, I... Because they'll notice a token. Yes, I have an experience with that. I was on Pump.comon, just looking at what was...

Sometimes I just poke around there. And this was, I saw a token. This was after the healthcare shooter, right? I think Brian Thompson was assassinated. Louis-Jame, yeah, man, funny. And I saw a picture of a guy, and its name was Luigi. And I thought, oh, that must be the shooter's name. So I actually learned the news from Pump That Fun.

It was crazy. I learned it. I did not buy it, unfortunately, because it went up a lot. But I did not buy it. I did see it, and I learned the news from it. And I think that's honestly what the Pump. That Fund guys, not that one specifically, but I think it's representative of the point that you and Olaf are making. These things are like people want to trade the news, people want to disseminate

information. This is a way to do it. And I think that Pump Fund is sad. I thought they have so much money. I think they have at least $500 million in their war chest. And I believe that they have big plans to make their platform into something that's much bigger than just a place where you go to trade meme coins. I don't know what that will look like, but I do think that it will lead into the ability for like the second order effects of meme coins, right? People can disseminate news through meme coins. I learned the news through meme corns.

I wasn't trying to learn the news through meme porn, but it happened. And that's crazy. It is crazy. And this whole last peak in crypto has been crazy. But, Danny, this conversation's been super fun. Thank you so much for coming on Unchained. Thank you. Don't forget.

Next up is the weekly news recap today presented by Wondercraft AI. Stick around for this week in crypto after this short break. Welcome to this week's Crypto Roundup. In today's recap, we cover an Ethereum user burning millions to warn of mind control, FTX's first wave of customer repayments, and the SEC's decision to drop its crypto rulemaking case, while launching a new unit to tackle fraud in AI and blockchain. We'll also dive into the Ethereum Foundation's push to improve blockchain interoperability,

the ongoing speculation around Jack Dorsey being Satoshi Nakamoto, and Z getting flooded with meme coins after sharing his wallet address. Plus, we look at the heated debate between Aptos and Monad over alleged tech plagiarism, the European Central Banks moved toward a blockchain-based payment system, and in our fun bits. Dave Portnoy accidentally pumping the wrong Libra token by 3,000%. Thanks for tuning in to the weekly news recap. Let's begin. Ethereum user burns millions to warn of mind control.

A Chinese Ethereum user has burned over 600 ETH worth, around 1.6 million in a series of transactions embedded with cryptic messages, warning about alleged brain machine control technologies. Identifying himself as Hula G, the individual claims to have been monitored and manipulated, since birth by a mysterious organization. Blockchain data reveals that Hu sent 500 ETH to a burn address on February 17th, making the funds permanently inaccessible. His messages, written in Chinese, accused executives at Kuwandi Investment, also known as Wizard Quant, of using brain computer weapons to control employees, who also made donations totaling 711.5 ETH to WikiLeaks,

funding the organization in multiple transactions. FTX begins first round of customer repayments. FTX has started its initial distribution of funds to customers, marking a key milestone in the exchange's ongoing bankruptcy proceedings. According to FTX Recovery Trust Administrator John J. Ray III, customers with claims under $50,000, classified as convenience class creditors, will receive payouts within the next three business days through BitGo and Cracken. The total value of this first distribution is approximately 1.5.

$1.2 billion with the next round of payments set for April 11th. FTX's broader bankruptcy plan, approved in October 2024, outlines that 98% of creditors will receive at least 118% of their original claims in cash. However, some creditors have expressed frustration as repayments are based on November 22 valuations when Bitcoin was significantly lower than today's prices. Larger claims exceeding $50,000 are expected to be addressed in the second quarter of 2025 as FTX continues its efforts to return an estimated $16 billion to former users. SEC drops appeal in crypto rulemaking case.

The U.S. Securities and Exchange Commission has voluntarily dismissed its appeal in a high-profile case over crypto regulations, marking a significant shift under the agency's new leadership. The case stemmed from a November ruling by a federal judge in Texas, which found that the SEC's attempt to redefine dealers, to include include Defi protocols and liquidity providers exceeded its authority. Crypto advocacy groups, including the Blockchain Association and Crypto Freedom Alliance of Texas, challenged the rule, arguing it placed unworkable compliance demands on decentralized platforms. With the SEC's dismissal, the decision now stands, effectively blocking the agency's expanded oversight of DeFi projects.

Complete and total victory today in our case against the SEC, said Blockchain Association's CEO, Kristen Smith. Kristen Smith. Under new acting chair, Mark Yuyeda, the SEC has also paused enforcement actions against major crypto firms and established a crypto task force, signaling a more collaborative regulatory approach moving forward. SEC forms new unit to combat crypto and AI fraud. Meanwhile, the SEC also launched a new division this week, the Cyber and Emerging Technologies Unit, to protect investors from fraud in cryptocurrency and artificial intelligence. Announced on Thursday, replaces the crypto assets and cyber unit, which was created in 2022. Laura DeLeard, a longtime SEC enforcement official, will lead the unit.

The unit will not only protect investors, but will also facilitate capital formation and market efficiency by clearing the way for innovation to grow, said SEC acting chair Mark Yeda. CETU's role will align with Commissioner Hester Perce Crypto Task Force, which is working to classify certain digital assets as non-securities. The unit will focus on fraud involving AI, machine learning, and blockchain technology as part of the agency's broader shift in regulatory strategy under the new administration. Ethereum developers launch interoperability solution. The Ethereum Foundation, alongside industry partners Hyperlane and BootNode, has introduced the Open Intense Framework,

a new initiative designed to standardize and simplify intent-based transactions across blockchain networks and solve some of the long-standing interoperability problems in the Ethereum ecosystem. Unlike traditional blockchain transactions that require users to specify every step, such as gas fees and contract interactions, Intense allow users to simply state what they want to achieve, like swapping one cryptocurrency for another, while third-party services handle the execution. This approach simplifies transactions,

particularly across different blockchain networks. The framework builds upon ERC 7-6000, 7 Sitsity3, a proposal co-authored by Uniswop and Across, which laid the groundwork for a unified approach to cross-chain intents. Leading Layer 2 solutions, including Arbitrum, Optimism, Zag Sync, and Scroll, are supporting the initiative from launch. By providing a modular infrastructure, OIF aims to enhance efficiency, improve accessibility, and accelerate adoption of intent-based transactions, making blockchain interactions smoother across the Ethereum ecosystem. Is Jack Dorsey Bitcoin's creator? A fresh wave of speculation about the identity of Satoshi Nakamoto, Bitcoin's elusive creator,

has emerged after Vanex head of digital assets, Matthew Siegel, voiced his belief that Twitter co-founder and block CEO Jack Dorsey could be the person behind the pseudonym. Segal's theory, based on research by debanked CEO Sean Murray, highlights a series of alleged connections, including Dorsey, his deep ties to cryptography, his past interactions with Bitcoin pioneers, and coincidental timestamps on key Bitcoin-related events. Among the claims is that Bitcoin's first transaction was sent on Dorsey's mother's birthday, and that Satoshi mined their last block on his father's birthday. While Segal insists his stance as a personal opinion, critics have dismissed the theory

as speculation, with some arguing that publicizing such claims could put a target on Dorsey's back. The debate continues, but as with past Satoshi theories, conclusive proof remains elusive. CZ flooded with meme coins after revealing wallet address. Former Binance CEO Changping Zhao unintentionally became the target of a meme coin frenzy after publicly sharing his wallet address while donating to a student fundraiser. Zhao had sent 150 BNB worth around $100,000 to help compensate traders who lost money on Libra. But his transaction post on X, exposed his wallet, prompting crypto users to flood it with 828,000 worth of meme coins within 20 few hours.

The largest holding, Broccoli, a token inspired by his pet dog that CZ had jokingly encouraged users to create. Acknowledging the situation, CZ remarked, funny things in crypto, and pledged to donate the funds to those affected by trading losses. Meanwhile, Nigeria is suing Binance for $81 billion, alleging the exchange caused massive economic losses and evaded $2 billion in taxes. The country previously jailed two Binance executives as part of its inquiry into the crypto giant. Moreover, Binance U.S. reinstated Fiat deposits and withdrawals nearly two years after suspending them due to an SEC lawsuit. Aptos and Monad clash over technology

allegations. A public dispute has erupted between Aptos Research Director Alexander Spiegelman and Monad co-founder James Hunsaker over claims of plagiarism in blockchain technology. Spiegelman accused Monad of copying Aptos' innovations, stating on X that the team should just copy directly instead of attempting to conceal it. Hunsiger fired back, dismissing the accusations, and emphasizing that optimistic concurrency control, a key component of both platforms' transaction processing, predates both projects by decades. He added, I've never looked at any Aptos code, and only thinks about the company when it posts nonsense. Both Monad and Aptos leverage parallel execution to enhance blockchain scalability, with Monad boasting 10,000 transactions per second and low gas fees, while Aptos employs dynamic parallelism for efficient processing.

European Central Bank Plans Blockchain-Based Payment System The European Central Bank announced plans to develop a blockchain-based payment system that would enable financial institutions to settle transactions using central bank money, a move that could lay the groundwork for a wholesale central bank digital currency. This is an important contribution to enhancing European financial market efficiency through innovation, said ECB executive board member Piero Kipollone in a statement. The project will be rolled out in two phases.

Initially, the ECB plans to link a blockchain platform to its existing target settlement system. The long-term goal is to create a more integrated solution that would also support foreign exchange operations. Fun bits. Dave Portnoy buys wrong. Libra token. Oops, he did it again. Barstool sports founder Dave Portnoy accidentally invested $170,000 in the wrong Libra token, sending its price soaring over 3,000 percent. Realizing his mistake, Portnoy took to X, warning, anybody want to buy some fake Libra? It will eventually go to zero. Despite his candid disclaimer, the token's price spiked before crashing back down, leaving Portnoy with a hefty paper loss of over $100,000.

The mix-up? He bought a similarly named token instead of the controversial Libra, linked to Argentinian President Javier Millet. Moral of the story, always double-check the contract address, or just stick to sports betting. And that's all! thanks so much for joining us today! If you enjoyed this recap, go to Unchained Crypto.Behivecom, that is Unchained Crypto. Beehivecom and sign up for our free newsletter so that you can stay up to date with the latest in crypto. Unchanged is produced by Laura Shin with help from Matt Pilchard, Juan Aranovich,

Megan Gavis, Pam Majimdar, and Margaret Curia. The weekly recap was written by Juan Aronovich and edited by Stephen Erlich. Thanks for listening.