ROLLUP: Bitcoin ETF Rumors | IRS Tax Rules | Ethereum Dencun

Bankless Weekly Rollup First Week of 2024 ----- 🏹 USE PODCAST24 FOR 10% OFF https://bankless.cc/Citizen2024 ------ BANKLESS SPONSOR TOOLS: 🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE ⁠https://k.xyz/bankless-pod-q2 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle ⚖️ARBITRUM | SCALING ETHEREUM ⁠https://bankless.cc/Arbitrum 🔗CELO | CEL2 COMING SOON https://bankless.cc/Celo 🗣️TOKU | CRYPTO EMPLOYMENT SOLUTION https://bankless.cc/Toku ------ TIMESTAMPS 0:00 Intro 8:00 MARKETS https://www.coingecko.com/en/coins/bitcoin/ars 10:25 Bitcoin https://cointelegraph.com/news/bitcoin-birthday-15-years-satoshi-nakamoto-genesis-block-mine https://twitter.com/lopp/status/1738547873967435907?s=46 13:00 ETH 15:10 MatrixPort Liquidations https://twitter.com/WatcherGuru/status/1742541738940510645 https://www.theblock.co/post/270125/sec-will-reject-all-bitcoin-spot-etfs-in-january-says-matrixport-analyst https://x.com/TrustlessState/status/1742597650791162271?s=20 19:20 SEI , ARB , OP https://www.coingecko.com/en/coins/sei https://defillama.com/chains 21:50 Narrative Investing https://dune.com/cryptokoryo/narratives 27:00 Bitcoin ETFs https://twitter.com/JSeyff/status/1742216237017342041 https://twitter.com/EricBalchunas/status/1742580887022125209?s=20 https://twitter.com/EricBalchunas/status/1742543503375106139?s=20 https://x.com/MetaLawMan/status/1742532353535180988?s=20 31:00 Insane IRS Crypto Rules https://twitter.com/jerrybrito/status/1742246479593382207 https://x.com/RyanSAdams/status/1742257989195636978?s=20 https://x.com/NeerajKA/status/1742362328937746793?s=20 https://twitter.com/CryptoTaxGuyETH/status/1742366293649465782?s=20 https://x.com/jerrybrito/status/1742662203784744971?s=20 39:00 Ethereum Duncan https://x.com/christine_dkim/status/1737889041981575320?s=20 https://www.eip4844.com/ 42:30 Devcon 7 https://devcon.org/en/ 43:00 Avalanche Culture https://x.com/avax/status/1740538202346381605?s=20 45:00 Michael Saylor https://warpcast.com/rsa/0xd1b6a261 https://x.com/BitDeez/status/1742313181697945878?s=20 https://x.com/ecoinometrics/status/1740034802508796186?s=20 46:50 LUNA is a Security https://www.coindesk.com/policy/2023/12/28/terraform-labs-luna-and-mir-tokens-are-securities-judge-rules/ https://twitter.com/metalawman/status/1740785789234028840 49:50 No More SBF Trials https://www.reuters.com/legal/sam-bankman-fried-will-not-face-second-trial-us-prosecutors-say-2023-12-29/ https://www.theblock.co/post/268450/ftx-bankruptcy-could-go-on-for-years-legal-expert-says 51:35 Barry Dilbert Steps Down https://www.coindesk.com/business/2023/12/26/barry-silbert-resigns-as-grayscale-chairman-to-be-replaced-by-mark-shifke/ https://www.sec.gov/ix?doc=/Archives/edgar/data/0001588489/000095017023072820/gbtc-20231226.htm 52:40 Dymension Airdrop https://x.com/dymension/status/1742185621299265738?s=20 https://x.com/dymension/status/1742185624696680823?s=20 55:00 Manta https://twitter.com/MantaNetwork/status/1678807287761195008?s=20 https://twitter.com/MantaNetwork/status/1735268753984864349 57:00 MEME of the Week https://x.com/BanklessHQ/status/1742662299087929472?s=20 ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures⁠

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00David Hoffman?

  Everyone is getting ready for the spot Bitcoin ETF approval. Almost everyone. Is that why Bitcoin went down 10%?

• 0:09Ryan Sean Adams?

  Eggless Nation, it is our first weekly rollup of 2024. David, how you doing, man?

• 0:16David Hoffman?

  Pretty good, my man. I'm down in Argentina. It's a good place to be.

• 0:19Ryan Sean Adams?

  Oh, I know. I want to talk to you about that, but let's give the folks a tease of what's going on in the weekly rollup first. Number one, we got Bitcoin down. It was over 10% down in one day.

• 0:31David Hoffman?

  Big move down.

• 0:32Ryan Sean Adams?

  Yeah. Why did it sell off? We're going to talk about that. What else we got?

• 0:35David Hoffman?

  Brian, are you ready to go to jail?

• 0:37Ryan Sean Adams?

  Um, no, not this year. Why?

• 0:41David Hoffman?

  Because there's crypto tax rules that just took effect. And if you ever claim an airdrop worth, you know, $10,000, you have to report it to the IRS pretty damn soon, or else you go to jail. So I'll see you in jail by the end of this year. We'll talk about all of that. Ethereum Dencun, we got a date for you as well for when rollups are getting 90% fee reductions. It's coming very, very soon. It's coming in just a few months now. We'll give you all the details. And also, Ryan, I know I won't be seeing you at DevCon 7, but everyone who does go to DevCon 7, we just got the details announced. So we will all see you when and where. We will find out.

• 1:18Ryan Sean Adams?

  That's a good tease, David. It's in a very far away place, so that's another reason why I won't be attending. But I'm very excited for you to attend. Speaking of world traveling, you said you were in Argentina. And before we started recording this episode, you were waving around some fat stacks. Okay, can you tell me how the fiat system works over there in Argentina? Like, what's your experience been so far?

• 1:43David Hoffman?

  You want to see what $1,000 looks like, or excuse me, $100 looks like in Argentina?

• 1:48Ryan Sean Adams?

  $100 US dollars in Argentina.

• 1:49David Hoffman?

  $100 US dollars. It looks like this. Yeah, looks like that.

• 1:52Ryan Sean Adams?

  Oh, my God. Wow, that is a stack.

• 1:56David Hoffman?

  That's a wad of cash. I think this is 100 bills of Argentine pesos. This is actually, actually, these are 100 pesos. There's a wad of 1,000 pesos. Actually, just kidding. This is $10. This is $10 right here.

• 2:08Ryan Sean Adams?

  That's $10?

• 2:09David Hoffman?

  Yeah. So their current conversion ratio is 1,000 to one. And this is 100, 100 peso bills.

• 2:17Ryan Sean Adams?

  What 1,000 to one, is that like fixed or does that vary based on?

• 2:20David Hoffman?

  That's the current market rate. That's the current market rate. Yeah.

• 2:23Ryan Sean Adams?

  It just happens to be 1,000 to one?

• 2:24David Hoffman?

  Yeah. Here's the largest Argentine peso bill, which is a 2,000 peso bill.

• 2:29Ryan Sean Adams?

  It's about?

• 2:30David Hoffman?

  It's about $2. Yeah. Yeah. So like I, when I go and I pay anything in cash, I'm carrying around like fat stacks of bills. When I was in Argentina in 2016, the ratio, the conversion ratio was 16 to one, which is like, you know, it's not crazy. It's not terrible.

• 2:46David Hoffman?

  You know, 2016, how many years ago was that? Seven years ago. So in seven years, it goes from 16 to one to 1,000 to one.

• 2:52Ryan Sean Adams?

  Okay. So is this like when you're purchasing things, you're going to a restaurant, you're getting food or something, you're getting groceries. Are you buying things with pesos? Is it like all cash business or can you like use a credit card or something like this or?

• 3:03David Hoffman?

  Yeah.

• 3:04Ryan Sean Adams?

  Some other means of payment?

• 3:05David Hoffman?

  I would say more frequently than not, you can use a credit card. Some, some things are cash only. Like there's a lot of street markets, for example. Credit cards are pretty well proliferated, I'd say, or debit, credit card, debit card, tap to pay. But then also the decent number of times, like you just, you gotta use pesos too.

• 3:22Ryan Sean Adams?

  Wow. That's crazy. How has it been so far overall?

• 3:25David Hoffman?

  Argentina or using pesos?

• 3:27Ryan Sean Adams?

  No, Argentina.

• 3:28David Hoffman?

  Oh, Argentina.

• 3:29Ryan Sean Adams?

  pesos has got to be, like, it's probably a novelty if you're there for like a couple of weeks, but like, I'm sure that gets pretty damn old if you're.

• 3:36David Hoffman?

  Well, yeah. So like the, Josh was asking me, it's like, so what's it like to pay in pesos? Is it like kind of cool because you have like a big wad of cash? And I'm like, no, it's actually, it's actually really annoying because like, okay, here's a $20 food bill. And I go one, two, three. I start to start counting. I'm like, oh my God, it keeps on going. These are, cause so like the, the 100 peso bill. It's 10 cents. One bill is 10 cents. It's a dime for us.

• 4:02Ryan Sean Adams?

  I've seen your, your wallet. You have a very small wallet. I've, I've seen this.

• 4:05David Hoffman?

  There's no bills go in there.

• 4:07Ryan Sean Adams?

  Like, how do you, how do you fit that? I mean, like you must have.

• 4:10David Hoffman?

  I have like, I have a whole pocket. I have a whole pocket full. I literally put one of these things in my pockets and then I come back and it's like gone.

• 4:18Ryan Sean Adams?

  Oh, that's crazy. No, no. Okay. But aside from the fiat, which we know is destined for failure, no matter what country you're in, eventually your fiat will fail. Tell me about Argentina.

• 4:29David Hoffman?

  Es fantastico. Uh, uh, anoche, uh, there's a bankless meetup at a wine bar. Uh, I, so we put out the bankless meetup a while ago, set for Friday, and we were going to rent out half the wine bar. A wine bar is like a, kind of a popular place in, um, one of the nice neighborhoods, uh, and for a hundred people. And it instantly filled up. It filled up inside of 30 minutes. I was like, oh my God, I did not realize that A, there's, there's so many bankless fans like ready in Argentina and Brunet's already ready to go. And, and so like B, we have to move places. And so we went from, we went from Friday where we could rent half the place to Thursday, which is today, to rent all the place. And then it just instantly filled up, even though we doubled the capacity. Uh, and so, uh, I'm a little bit intimidated by that, but it's gonna be a good

• 5:12David Hoffman?

  time. It's gonna be a good time. We're gonna have some Malbec and some empanadas. Uh, am I gonna give a speech? Perhaps? I don't know. Uh, you know, you know me, I make things up as I go.

• 5:24Ryan Sean Adams?

  And tell all the bankless Argentinians I say hello as well. And, uh, you know, I'd be there in person if I could. I, I have COVID right now, David. This is another excuse. And so, uh, if I sound a little bit nasally or a little bit under the weather, then Bankless Station, that is why. But, uh, we cannot, won't stop the weekly roll up. As we kick off 2024, we've got a, a message from, from ourselves that we want to let the bankless community know. We have a special offer for everyone listening to this podcast. 10% off a bankless citizenship. We've had over a thousand new citizens join in the last 30 days, David. So, uh, things are really heating up. This is one of our most active seasons. Like, there's so much getting, uh, built on top of a bankless

• 6:09Ryan Sean Adams?

  citizenship. Could you tell folks what a bankless citizenship actually is?

• 6:14David Hoffman?

  Well, for the podcast listeners, the first and most obvious thing is the premium podcast RSS feed, the one that you're not listening to, if you're on the free feed, obviously. Uh, there's one that has extra episodes and the one that has zero ads. So if you're a podcast listener and you just want a better podcast listening experience, you can sign up for the Bankless Citizen RSS feed. There's also the Bankless Nation Discord, which is like the most buzzing that it's ever been. Uh, people are talking about airdrops, people are talking about DeFi farming strategies, airdrops on different chains, all these different strategies. The airdrop hunter corner of the Bankless Discord is like super active because of the airdrop hunter part of the Bankless website, which you also get. If your friends are coming into crypto and they're asking like, hey, how do I hunt an airdrop?

• 6:55David Hoffman?

  Well, that's the product that we built for them. They don't have to ask you. They just have to go to the airdrop hunter. Overall, also, there's also the ETH Denver meetup, which we're about to coordinate for Bankless Citizens. There's probably just no higher ROI time to be a Bankless citizen. So you should sign up to become a Bankless citizen.

• 7:12Ryan Sean Adams?

  Yeah, look at this. This is from in Kido. I signed up for Bankless because I love the podcast, but the airdrop hunter function has paid multiples. After finding out there might be a GTO airdrop via Bankless, I invested 500 in M Sol, converted it and then got 10K. Got 10K. My daughter has more money in her 529 plan. That's a college savings account there. And I started another 529, thanks to Bankless. This is the time-

• 7:40David Hoffman?

  So we have an airdrop hunter tax optimizer barbell spectrum guy on-

• 7:45Ryan Sean Adams?

  We're paid for people's colleges, David. It's just absolutely fantastic. Anyway, Bankless Nation, we promised you a discount too. So if you use the code PODCAST24, you can get 10% off a Bankless citizenship for monthly or the year. And you can go access that at bankless.com/join. Or there's a link in the show notes, as always, that code again-

• 8:09David Hoffman?

  There's also a QR code floating on the screen for people on the YouTube.

• 8:13Ryan Sean Adams?

  Yeah, PODCAST24 QR code. Yeah, you'll figure it out. David, let's figure out Bitcoin this week. You wanted me to start this Bitcoin priced in pesos, Argentinian pesos. This chart looks nice because it's up and to the right, but not if you hold pesos.

• 8:33David Hoffman?

  Yeah, it looks pretty scary. So the Bitcoin Argentine peso chart is a small, squiggly line very close to the bottom. And then right on the right side, it is absolutely vertical. Pesos just devalued by like 50% right before I got here in dollar terms. The log chart is just up only. Bitcoin is setting like a crazy all time highs every single week in Argentine pesos. This is what fiat currencies are all trending towards. It's just a matter of time.

• 9:01Ryan Sean Adams?

  Yup. Well, speaking of that, tell me about Bitcoin in the fiat currency that is the global reserve currency priced in dollars. Where are we at on the week?

• 9:11David Hoffman?

  Also up, just, you know, not as up as much versus Argentine pesos. It's up 3% on the week. The official, Ryan, the official starting price of 2024 for Bitcoin is $42,500. Up 3% to where we are now at five days into the week at $44,000. We've got some yearly candles to look at. So these are candles where one candle represents one year. It's just kind of nice to zoom basically as far out as possible in Bitcoin's history and just look at one year.

• 9:40Ryan Sean Adams?

  Big fat candles. Look at these.

• 9:40David Hoffman?

  Big fat candles. Big fat candles. We're looking good. The 2023 candle almost completely erased the 2022 candle. So we are basically almost setting new highs in 2022 from where 2022 started. So this is, we're looking at price discovery from a yearly perspective. These are looking really, really good on the yearly candle chart.

• 10:04Ryan Sean Adams?

  This is, we have some red candles, but it's all mostly green. So almost every year in Bitcoin has been green, except for 2018 and 2022. Every other year is a big green candle.

• 10:16David Hoffman?

  Those years were very, very red, though.

• 10:19David Hoffman?

  This particular chart only goes to 2014, just because the data is not there. But yeah.

• 10:25Ryan Sean Adams?

  While we're on Bitcoin, David, we should give a shout out to Bitcoin's birthday. 15 years after Satoshi Nakamoto mined the Genesis block. We just celebrated that. Was that on January 3rd that happened?

• 10:37David Hoffman?

  It was on January 3rd. That was Wednesday this week.

• 10:38Ryan Sean Adams?

  15th birthday. I feel like we recently celebrated a Bitcoin birthday, but maybe that was just the white paper. That wasn't the Genesis block.

• 10:44David Hoffman?

  Bitcoin gets two birthdays per year. The birth of the white paper and the birth of the blockchain, which...

• 10:51Ryan Sean Adams?

  I don't know if that's fair.

• 10:52David Hoffman?

  I think that's fair.

• 10:53Ryan Sean Adams?

  You don't celebrate conception, right?

• 10:55David Hoffman?

  Bitcoin gets a happy conception day? No, I do not celebrate that.

• 11:01Ryan Sean Adams?

  Be a bit weird, right?

• 11:02David Hoffman?

  I think we get to celebrate Bitcoin's conception day and its birthday.

• 11:06Ryan Sean Adams?

  Okay, all right. Well, I'm just saying, like, most people only have one birthday. I bet, you know, I guess Bitcoin can celebrate its conception and also the genesis block. Anyway, happy birthday, happy 15th Bitcoin. We started this whole thing.

• 11:19David Hoffman?

  Fun fact, Bitcoin has mined 825,000 blocks. So I guess we got like four, three more years until 100,000 Bitcoin blocks?

• 11:31Ryan Sean Adams?

  That'll be a big day. 100,000 Bitcoin blocks? I don't know. I just haven't really been paying attention to that number, but now I am. I'll be excited to celebrate that day, too. One thing that's exciting for Bitcoin, though, is revenue via fee transactions is up to like almost all time high, averaged nearly 2 million per day in 2023, all of last year. It's 400% year over year. This is from things like inscriptions, right? All of the Bitcoin NFTs.

• 11:58David Hoffman?

  Ordinals and inscriptions.

• 11:59Ryan Sean Adams?

  BRC 20's Bitcoin fee revenue has really just absolutely crushed it last year, and I expect that to continue going into this year.

• 12:07David Hoffman?

  I think this is all time highs. This is definitely all time highs in an area under the curve perspective. From November of this year, like fee revenue has been significant as compared to marginal, which it's been marginal every other time in Bitcoin's history, except for May, when inscriptions and ordinals like were birthed. And then they kind of died off between July and November, but now they are back with a force. The Lindy behind Bitcoin's fee revenue is like growing pretty good, I'd say, pretty well, more better than I expected it to.

• 12:38Ryan Sean Adams?

  That's good. It's good for Bitcoin economics and certainly good for miners, which is kind of unexpected.

• 12:46David Hoffman?

  Miners are going to be printing because like a year ago, they were all on the verge of bankruptcy. And now they're making more revenue than they ever have before.

• 12:54Ryan Sean Adams?

  It's so weird. It's like feast or famine for Bitcoin miners. All right, let's go over to ETH price. Tell me this in dollars, David. What is the price of ETH on the week?

• 13:02David Hoffman?

  ETH started the year at $2,300. $2,300 is currently down 1% at 2,270. So, starting the week as we end, or started the year as we ended the year with Ether, which is always down a little bit.

• 13:18Ryan Sean Adams?

  Let's look at the yearly bars here, David. So, we've got two red bars, the same as we had with Bitcoin and a lot of green. But what does Ether look on a like year-to-year basis?

• 13:30David Hoffman?

  Yeah, it's 2023 candle was about half as big as Bitcoins, which we know this Bitcoin did a 3X in 2023, Ether did a 2X. Does that mean ETH has more to grow? Is that just my bias and my desire? I'll let the nation decide.

• 13:46Ryan Sean Adams?

  A little bit of both, maybe. ETH Bitcoin ratio, where are we at on the week?

• 13:51David Hoffman?

  Down just a little bit. We have .052, .052, otherwise decently flat.

• 13:56Ryan Sean Adams?

  This is the

• 13:57David Hoffman?

  The ratio charts is what we're looking at right now, and that looks pretty good. I would say that that is primed for a green candle.

• 14:04Ryan Sean Adams?

  Yeah, I've actually never seen it like this. This is a very interesting chart. So, 2017 Ether far outperformed Bitcoin, like huge green ratio there. 2018, 2019, it did not. It underperformed Bitcoin.

• 14:19David Hoffman?

  No, that's when we were being bullied by Bitcoiners.

• 14:21Ryan Sean Adams?

  Yeah, 2021 was a huge year for Ether.

• 14:24David Hoffman?

  2021 was the year of ultrasound money.

• 14:26Ryan Sean Adams?

  Yeah, and then since then, it's been red candles. So, 2022 and 2023 versus Bitcoin.

• 14:34David Hoffman?

  Yeah, I think we could probably get like maybe a small to medium green candle this year and then a massive green candle next year. One of these two years, 2024, 2025, will be the year of the internet bond.

• 14:46Ryan Sean Adams?

  I think I think we're going to get a green candle this year for sure. And I think it's

• 14:50David Hoffman?

  Yeah, but is it is it like the big green candle that we got in 2020, which was just like marginal? Or is it the green candle that we got in 2021, which was Chad?

• 15:00Ryan Sean Adams?

  I would split the split the difference here is my

• 15:05David Hoffman?

  All right, back to point 08.

• 15:06Ryan Sean Adams?

  Yeah, total crypto market cap. Where are we at on the on the week?

• 15:10David Hoffman?

  1.75 trillion, still kind of stuck in that 1.75 range.

• 15:15Ryan Sean Adams?

  All right. I mean, we're starting the year at 1.7 trillion. It's total crypto market cap is not too bad. Another thing we're starting the year with is a $540 million worth of liquidations. Do you see this on the chart? We breezed right past this. This is the Bitcoin chart. You see this red candle all the way down? What in the world happened on January 3rd, 2024? Like, was this all liquidations? Did something precipitate this this massive 10% plus price drop in Bitcoin and the rest of the crypto market? Tell me what's going on here.

• 15:50David Hoffman?

  Yeah, so in bull markets, there's this pretty regular ritual of the D gens getting liquidated in both directions, up and down. And we had one of those, you know, we had one of those ceremonies not too long ago, a clearing of the leverage ceremony. So yeah, like you said, over half a billion dollars was liquidated in the crypto markets when Bitcoin went from $44,000 down below like $39,000 and then and then popped right back up.

• 16:17David Hoffman?

  $540 million is no small amount. What caused this? Why did it happen? So an article out of the block says that SEC will reject all Bitcoin spot ETFs in January, says Matrix Port analyst. This is a huge headline to say to and then and then you realize like, oh, it's this as an analyst. But this this report, this article just sent the markets just spinning because everyone thought that the SEC was going to reject all the Bitcoin spot ETFs.

• 16:45Ryan Sean Adams?

  Okay, so we had a lot of margin on the books, kind of looking for like, you know, it's going to happen at some point in time where all of this debris has to be cleaned. And this was just the the match, right? This was kind of The spark that caused that cascade of liquidations that we routinely get, you know, every three to six months, we get one of these. And it just happened to be this article, maybe from the block. Block has a pretty wide circulation in crypto, saying the SEC is going to reject all Bitcoin spot ETFs. And the funny thing here is, they are quoting, it's kind of a random Matrix Port analyst. Yeah, so here's the report in question, Matrix on Target. And

• 17:24Ryan Sean Adams?

  basically, it gives a reason, just some analyst's opinion on why the SEC is going to reject Bitcoin spot ETFs again. We're going to talk more about that in the next section. The fact that this particular event is being charged with this cascade of liquidations, do you think that's fair? Do you think that's what happened?

• 17:42David Hoffman?

  I think we can kind of chalk this up to being more of a coincidence than anything. Whenever, you know, the meme of just like Bitcoin goes up 5%, and then somebody, your dad or your cousin texts you, like, hey, why is Bitcoin moving? And you're like, I don't know. Like, people are always looking for reasons as to why the market moves. And was this the match that lit the fire? Were the D gens going to inevitably be liquidated? Because this always happens in crypto, there's always a clearing of the leverage. And then people went to the nearest, like, reason they can find, and they just happened to find this article that says, this analyst says that the SEC is going to deny the spot Bitcoin ETFs. I don't really know. We do know that the open interest for Bitcoin, which is people going long, had historically high

• 18:24David Hoffman?

  funding rates. So we had the most leveraged long position, leveraged long, in Bitcoin's history. Everyone is just, you know, taking leverage to long the approval of these spot Bitcoin ETFs. And so the markets are on a knife edge, they're on a precipice, any short of uncertainty or change in the winds, we're going to trigger this liquidation wave. And again, we will see more liquidation waves in the future. We will see them like five, six, seven times this coming bull market. We saw them like 10 times last bull market. This is a rite of passage, it's a clearing of the brush. And there was this one Matrix Port article that was like, hey, we think the SEC is going to deny the Bitcoin ETFs. Really, it was the D gens, it was the leverage.

• 19:06Ryan Sean Adams?

  Yeah, yeah, it really was. I mean, the markets got spooked by a stiff breeze. Like, it was absolutely like an analyst's opinion, like, who cares, right? So it's funny that-

• 19:15David Hoffman?

  And they're wrong, by the way.

• 19:18Ryan Sean Adams?

  We'll get to that a little bit later. David, movers of the week. Tell me about some tokens that were moving. The first one you have here is Say, up 70%?

• 19:27David Hoffman?

  Yeah, up 70% on the week, over 100% on the month. Say, it is a Paralyzed EVM Layer 1, has been just making a ton of moves lately. It's up to 80, 80 cents, it was at 20 cents just not too long ago. People are buying into the Paralyzed Virtual Machine narrative after the success of Solana and the parallelization of the SVM. Now, the parallelization of the EVM is kind of in vogue. So Say is kind of one of the only horses you can bet on in that race. And so that's why it's up 70, 70% in the week.

• 19:58Ryan Sean Adams?

  Not just Say, though, Layer 2s as well, particularly the arb token had a fantastic week at all-time highs and also Optimism.

• 20:06David Hoffman?

  Yeah, congrats to Arbitrum for breaking $2. The Arbitrum Layer 2 on Ethereum is also the number 2 chain in volume at the moment, beating Binance Smart Chain, which is a tough chain to beat, coming in after Ethereum. It's nice to see an Ethereum Layer 2 in the second spot behind Ethereum, let me tell you that. And yes, also, like you said, Optimism, the OP token, also has reached all-time highs, touched over $4, back down to $3.8. Just over, Layer 2 is just absolutely killing it in a kind of a sneaky fashion, I'd say.

• 20:38Ryan Sean Adams?

  Yeah, another milestone reached in total value locked on Layer 2s. We are now exceeding 20 billion of asset value that is locked inside of Layer 2s, which feels pretty big.

• 20:49David Hoffman?

  We were at 12 billion just in like, a few months ago.

• 20:52Ryan Sean Adams?

  Yeah, this is Josh Stark putting a finer point on this. It happened. Ethereum Layer 2s are equal to 20.7 billion, other Layer 1s equal to 19.67 billion. You can see this chart-

• 21:05David Hoffman?

  In TVL, in TVL is what you're talking about.

• 21:08Ryan Sean Adams?

  Yeah, I should say this. You could see this chart that he put up. It's kind of a flipping of sorts. Alternative Layer 1s, non-Ethereum Layer 1s in blue, and of course, they got as high as $80 billion at one point in time. This must have been the heavy tariff.

• 21:23David Hoffman?

  Well, no, that was, no, it was the, it was that one developer on Solana who's- spun up like eight different DeFi apps and they had the rehypothecation of a dollar where one dollar ultimately became thirteen dollars. Which is why it went so quickly down. Yeah, it was just like, it was like an accounting trick. And there was a bunch of like inflated TVL metrics.

• 21:40Ryan Sean Adams?

  Anyway, this is not a metric I've been actually looking at, but it's a really interesting metrics. So Ethereum layer twos now have more total value locked than all of the other layer ones combined, which is quite a milestone here. David, before we end this market section, I want to show you this. This is actually a really cool dashboard that I found on Dune Analytics is brought to my attention. And I think presents a great point that is important for us to remember going to this market. This is a crypto narrative dashboard. We've said before that there are three types of ways you can kind of deploy capital in crypto. One, you can either be a trader, right? A trader is very interested in kind of like TA.

• 22:20Ryan Sean Adams?

  What are the charts saying? Like, what's the catalyst? You know, it's like the daily, even the minute by minute or like kind of the weekly numbers, right? That's you could be a trader in crypto.

• 22:30David Hoffman?

  Like 20 to 50 plus moves a year, I would say.

• 22:34Ryan Sean Adams?

  Yeah, exactly. The second type of investor and the way to deploy capital in crypto is you can be a narrative investor. Okay, so you can look at different narratives like AI and crypto or NFTs or like memes or like China or all sorts of game fi maybe. And you can deploy against these narratives. And the interesting thing about being a narrative investor is it's a longer time horizon. Then you're trying to predict the next narrative that takes hold is a longer time horizon than a trader. Right? And you can, you can have a bucket of assets and you don't actually have to bet that the thing will work. You just have to bet that people will get excited about it.

• 23:15David Hoffman?

  Yeah, it's a great fool's game.

• 23:16Ryan Sean Adams?

  Right? And then there's the fundamentals investors, kind of the buy hold, look at on-chain metrics. You can, you know, look, look at kind of fee revenue, you can look at developer activity, all of these things. Bankless, you and I definitely skew towards more towards fundamentals, right?

• 23:33David Hoffman?

  I think, I think you are deep fundamentals and I flirt with narratives. Yeah, I don't have more fundamentals.

• 23:39Ryan Sean Adams?

  I don't have as much time for narratives as like, but like, but yes, I think that's true. But this is a great, I think, resource if you are interested in narrative investing. So the publisher of this Dune analyst dashboard, Crypto Cairo, publishes, published over 30 different narratives, including like Bitcoin, NFT, you know, friend tech, wallets, RWAs, real yield, all of these things. And then he tracks the narratives over time. And so the layer two narrative, David, over the past week or so, was actually one of the best performing narratives. In the layer two bucket, he kind of groups assets, right?

• 24:20Ryan Sean Adams?

  So in the layer two bucket, you get, you know, arbitrage, mantle, thematic, Metis, OP. It's kind of a cross section of assets that represent and exemplify that narrative. Anyway, it's a really cool way to be a narrative investor and to kind of sort out the logic of, well, am I going to invest in AI and crypto? Am I going to invest in real world assets? Am I going to invest in indexes? And how are they, how are these narrative, like, how are these narratives performing at various parts of the market? Anyway, I just wanted to share this with you because it's pretty cool. Even like the, the meme 2.0, man, this is so outside of my lane. Bob, ladies, Pepe, Turbo, WoJack, like, what are these things? I have no idea, but.

• 25:03David Hoffman?

  The moment that Ryan Shadens buys into memes 2.0 narratives is the moment my brain breaks.

• 25:10Ryan Sean Adams?

  Oh, my God. What do we have coming up next?

• 25:12David Hoffman?

  Coming up next, the Bitcoin ETF is about to get approved. We're going to talk about all the details and why we know that the matrix port analyst is totally wrong. Also, if you plan on claiming an airdrop in 2024, make sure that you have the social security number of someone on the team who's sending you that airdrop. Otherwise, you go to jail. You go to jail. We'll talk about those details and what can we expect from the next Ethereum upgrade, which is going live in March. That is Dan Kuhn, that is 4844. That's kind of the answer, but we'll talk about those details too. But first, a moment to talk about some of these fantastic sponsors that make this show possible, especially Kraken, our preferred crypto exchange in 2024. If you do not have an account with Kraken, consider clicking the link in the show notes below to get started with Kraken today.

• 25:57David Hoffman?

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• 26:42David Hoffman?

  Not investment advice. Crypto trading involves risk of loss. Cryptocurrency services are provided to US and US territory customers by Payward Ventures EK. PVI, doing business as Kraken. Are you launching a token? Is it already live? How are you managing the legal and tax for providing token awards for your team? Toku simplifies everything about managing token grant compensation, and you can get started with them for free. You'll have access to top-notch legal and tax support to handle the distribution and management of tokens for your team. Toku caters to every step in the process, from user-friendly legal templates for granting tokens to tracking vesting periods and calculating withholding taxes. Toku understands every grant structure: token purchase agreements, restricted token awards, restricted token units, token options, and all the other ones. Toku is already simplifying this today

• 27:25David Hoffman?

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• 28:07David Hoffman?

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• 28:36Ryan Sean Adams?

  All right, the number one question in everyone's mind in crypto right now, it's January 2024. Is the Bitcoin ETF coming or not? We were talking earlier about the Matrix Port Incident, the report that that came out that said the SEC was going to reject the ETFs. Still, the experts in this space, Eric Balchunas, James Safer, these are the people that we've talked to before on Bankless that seem to be tracking the Bitcoin ETF progress the most closely. They are still saying ETF is imminent. Here's James Safer, here's a view of the CoinTucky Derby, it's nice CoinTucky, starting gate as of this morning. He lists all of these different Bitcoin ETFs expecting to be approved, expecting most of these to be filled over the next week.

• 29:19Ryan Sean Adams?

  Still looking for potential approval orders, January 8th to January 10th. So James Safer is still saying, yeah, we're still on track. Next week, essentially, we're going to have a Bitcoin ETF.

• 29:34Ryan Sean Adams?

  And I leave for the mountains on January 7th. This is Eric Balchunas, I think responding to some of the FUD, he is quote tweeting, the SEC is actually holding meetings today with exchanges. So it's NASDAQ, CBOE, New York Stock Exchange to finalize comments on the Bitcoin spot ETF issuers. Eric Balchunas is simply pointing out, this is a thing you probably don't do if you're planning to deny. If you're gonna deny, yeah. Yeah, so he's putting to rest some of the FUD, I think, from a Matrix Port. It also seems like, David, Matrix port maybe has

• 30:10David Hoffman?

  They just changed opinions.

• 30:12Ryan Sean Adams?

  Opinions?

• 30:13David Hoffman?

  Yeah, so Matrix point first went out and gave that analysis like, hey, we're gonna, we don't think it's gonna get approved. We think they're gonna get denied. And within 24 hours, they flipped to, uh, they're gonna get approved. Just kidding. It's some bitcoins going to 50k, which is why people are like, what the hell's going on with these people? But other than that, yeah. So everyone has consensus that this is gonna get approved between January 8th and January 10th. By the next weekly roll up, we will have spot Bitcoin ETFs.

• 30:41Ryan Sean Adams?

  David, I'll be honest, the first time I've ever heard the, the name Matrix port has been like this week. So I, I'm not sure why, uh, they are the focal point for all of this. Uh, but yeah.

• 30:52David Hoffman?

  If you need any more evidence that we are going to get a spot Bitcoin ETF approval, here's Meta lawman who says, if the SEC were to deny all spot Bitcoin ETFs, the application applicants would immediately sue. And the DC Court of Appeals would again rule that the SEC was arbitrary and capricious. Again, why again? Well, because they already ruled that when they, when the SEC lost their case against Grayscale. This is what, as soon as they lost their case against Grayscale, we were all like

• 31:18Ryan Sean Adams?

  In September, last September.

• 31:19David Hoffman?

  In September, we were all like, oh, the spot Bitcoin ETF is getting approved. And so like, yeah, like, and who is going to sue, uh, sue the SEC? Not just some like Q crypto, like trusts, like Grayscale, it's BlackRock would sue them. And BlackRock would, would probably win. So congratulations prematurely on the spot Bitcoin ETF approval, everyone.

• 31:41Ryan Sean Adams?

  Well, next roll up. I hope we're talking about it, David.

• 31:44David Hoffman?

  If I'm wrong, I'm gonna be so, I'm going under the bus.

• 31:49Ryan Sean Adams?

  Yeah, they deny them all next week. We just won't show up for the roll up next week.

• 31:53David Hoffman?

  I'll be in the mountains, actually. So you're gonna be with Anthony Sedano next week.

• 31:58Ryan Sean Adams?

  All right. Well, you enjoy yourself. All right, David. So this is something that that came across my attention this week. This is a tweet from Jerry Brito, talking about new crypto tax reporting obligations that took effect on January 1. I didn't even know these existed. And these are the tax obligations, of course, for US citizens, you know, land of the free, home of the brave. Yep, all that stuff. If you receive 10K or more in crypto, you now have an obligation to report the transaction, including names, addresses, social security numbers, full AML KYC, to the IRS within 15 days, or you're under the threat of felony

• 32:40Ryan Sean Adams?

  charges. Okay, what is this? What is this? Can you explain? Because I know you know some details of this. Why? Like, what is going on here?

• 32:51David Hoffman?

  So someone who receives $10,000 or more in one or several crypto transactions that are related, must report it to the IRS within 15 days or face potential felony charges. So that's including airdrops, but also just sending crypto. So if you send someone crypto, or if you receive crypto from someone, you need their social security number, their name, and their address, and you must report it to the IRS inside of 15 days, or face federal felony charges, which is a lot of the transactions.

• 33:27Ryan Sean Adams?

  Yeah, yeah. So the question is, like, why are we just hearing about this now? So apparently, this was part of the Infrastructure Investment and Jobs Act, which passed Congress in November of 2021. Do you remember that?

• 33:38David Hoffman?

  The Biden infrastructure bill?

• 33:40Ryan Sean Adams?

  Yeah, the Biden infrastructure bill. There was a provision in there, amending the tax code to require anyone, as you said, who has 10K in cryptocurrency, in the course of, here's a keyword, their trade or business, we'll get back to that, to make this report to the IRS. No, they don't actually tell you how to report it.

• 34:00David Hoffman?

  How to report it, how to tell them?

• 34:02Ryan Sean Adams?

  Yeah, they don't actually have-

• 34:04David Hoffman?

  And just tweet at them?

• 34:05Ryan Sean Adams?

  Yeah. So the problem is many will find-

• 34:08David Hoffman?

  The blockchain's public. Isn't the blockchain reporting it to them publicly?

• 34:13Ryan Sean Adams?

  Yeah, this is a quote from the blog post from Coincenter. More to the point, where do you even send your report? The law says that one must make a report, in quotes, in such form as the Secretary of the Treasury may prescribe, but they don't actually tell you how to report this. Okay, and this is something that came into effect January 1st. Now, some people have pointed out, rightly so, that this only applies to businesses. And so maybe it doesn't apply to individuals. But that's not quite the full story because the obligation itself does apply to individuals if they receive 10K or more in crypto in the course of, here's the key word, a trade or business, their trade or business.

• 34:58Ryan Sean Adams?

  And how does the IRS determine what a trade or business is? Well, here's a definition. A trade or business is generally an activity carried on for the livelihood or in good faith to make a profit.

• 35:12David Hoffman?

  Well, that's the most subjective. If I receive $10,000 and intend on keeping it, I intend on making $10,000. So therefore I'm a business.

• 35:22Ryan Sean Adams?

  I don't know. I mean, this is the most subjective, terrible, definitely like, of course, you're getting 10K. I mean, of course, you're trying to make a prop. I don't know what other.

• 35:29David Hoffman?

  Let me tell you, I'm not donating my airdrops.

• 35:32Ryan Sean Adams?

  I don't, I don't understand.

• 35:35Ryan Sean Adams?

  There was another, like, I guess subtlety here. Some people have said, it's not actually starting now. So it's not starting January 1st. But Jerry Britton from Coincenter says, actually, the statute is self-executing. So maybe this is just some bureaucracy, just some like, I don't know, legislation that got passed and people didn't really think through the implications. So it doesn't necessarily mean that this is all nefarious because I'm sure there's people listening to this who have already received over 10K in crypto. Maybe via a smart contract, by the way, or like via a DAO. And like, it's unclear how you'd get a social security number from a smart contract or DeFi platform. So there's a lot of ambiguity and lack of clarity around this.

• 36:18Ryan Sean Adams?

  And maybe it's, it's, you know, going to be cleared out, cleared up in the weeks and months to come. But I mean, it's kind of disconcerting that you could be potentially charged with a felony, at least on the books for this type of thing. What's your take?

• 36:32David Hoffman?

  Yeah, it's what's that line like, don't ascribe maliciousness when there could be like ignorance. And so this, this is probably ignorance. But the thing is, is like, it could turn into maliciousness because it could be, it could be applied arbitrarily and capriciously to random people based off of whatever the hell the treasury or IRS or like whatever they want. And so, long story short, not, not great. Also very cringe, I would say. It's also cringe.

• 36:58Ryan Sean Adams?

  All right, David. So I agree it's cringe. We'll have to wait to see how all of this plays out. What do we have coming up next?

• 37:03David Hoffman?

  Coming up next, Avalanche Foundation trying to incent culture? Is that cringe? We'll talk about that. Gary Silbert's resignation? And what do you think was Michael Saylor's New Year's resolution? Everyone, hold your breath, place your bets, place your guesses. And also, a new meta for airdrops has arrived with the Dimension Drop. We'll talk about all of these details and more. But first, a moment to talk about some of these fantastic sponsors that make this show possible. Mantle, formerly known as BitDow, is the first DAO-led Web3 ecosystem, all built on top of Mantle's first core product, the Mantle Network. A brand-new, high-performance Ethereum Layer 2 built using the OP stack, but uses Eigenlayer's data availability solution instead of the expensive Ethereum Layer 1.

• 37:44David Hoffman?

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• 38:25David Hoffman?

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• 39:09David Hoffman?

  Experience Web3 development the way it was always meant to be: Secure, fast, cheap, and friction-free. Visit arbitrum.io and get your journey started in one of the largest Ethereum communities. Dencun is coming! What is Dencun? You might know it as the hard fork that brings in EIP4844, or proto Danksharding, or really cheap Layer 2s onto Ethereum. We've got the date. What's the date, Ryan?

• 39:35Ryan Sean Adams?

  It looks like the schedule for testnet upgrades is as follows: There's a Gorley testnet on January 17th. There's a Supoilia fork on January 31st. And there's a Holzke fork on February 7th. And this tweet from Christine Kim is saying, "A March mainnet activation for Dencun still appears likely." So, I heard March, David, Q1.

• 39:55David Hoffman?

  March.

• 39:56Ryan Sean Adams?

  You know, maybe this could seep into April, but this feels like March is a strong possibility that we get this newest Ethereum hard fork update.

• 40:04David Hoffman?

  Yeah, the idea here is that if the three testnets just successfully fork without hiccups, then, once that happens, then we just schedule the mainnet hard fork. And so, we need three green lights. We get our first green light, hopefully on the 17th, our second on the 31st, and then the third, hopefully on the February 7th. And that will clear the runways for Dencun on mainnet. Again, what does Dencun do? It does a whole handful of things. There is a link in the show notes to Tim Baker's tweet thread and website that'll explain all this. But really, the big one is EIP4844, of which there's a website for it, eip4844.com. This will decrease Layer 2 transaction fees by like 95% basically immediately.

• 40:48David Hoffman?

  And then Layer 2s will start to use that extra block. Space and layer two fees will go back up and they'll probably, this is a guesstimation of Justin Drake, around full dank sharding, full dank sharding, fees will be on layer twos about as expensive as they are today. There will be a lot more of them and then full dank sharding will come and they will go basically to zero for years until we figure out what do we do with all that block space.

• 41:16Ryan Sean Adams?

  So the reason for that is so we get like a 95% reduction as soon as this is released, right? But what you're saying, like in Justin Drake was articulating is, well, when things get cheaper, there's just going to be a lot more use, right? So we get like a massive scalability increase and then fees will creep up because more block space will be consumed again. And then we'll have another Ethereum hard fork for full dank sharding to make like data availability even even more plentiful and even cheaper. That's, that's the kind of the projection here, but what we get out of the gate is absolutely massive for layer twos, right? Which is scalability and/or fee reduction, depending on which side of the coin you want to look at.

• 42:00David Hoffman?

  The thing that will go up, up, up, up, up is going to be total transaction volume on layer twos. A total aggregate Ethereum scalability that the transaction volume will increase massively. And it'll increase up to the point that we return to whatever fee equilibrium we already are. And then we're going to set up that whole in process all over again with full dank sharding. Very exciting. We're all very excited. This is perhaps why OP and ARB are actually doing so well. Narrative traders are starting to trade the Dencun upgrade. This, this is the season, tis the season for narrative rotation.

• 42:33Ryan Sean Adams?

  That makes sense because transactions will start to cost fractions of a penny, I would imagine, post this upgrade. Once it starts being used. David, you promised some dev con updates. Where are we having dev con next year?

• 42:45David Hoffman?

  Having it in Southeast Asia. You can find all the details at devcon.org. We're going to Bangkok. We're all going to Bangkok in November 12th through 15th. I looked at flights, Ryan, that is a full 21 hour flight from New York. So that's going to be super fun. Yeah. So I will see you all in Bangkok and Thailand.

• 43:03Ryan Sean Adams?

  David, avalanche incentivizing culture? You, you mentioned this in the intro. What is going on here?

• 43:11David Hoffman?

  Yeah, so the Avalanche Foundation has launched a culture catalyst, a program aimed at empowering creators, they say. And then they say meme coins have carved out a significant niche in the crypto asset landscape. These coins, often inspired by internet culture and humor, go beyond mere utility assets. The Avalanche Foundation intends to start using culture catalysts to recognize and encourage the culture and fun symbolized by meme coins. By purchasing select avalanche-based meme coins to create a collection. So how will they choose the assets? Several selection criteria, number of holders, liquidity thresholds, project maturity, principles of a fair launch, overall social sentiment, AKA vibes.

• 43:55David Hoffman?

  And so as a following of this announcement, avalanche-based meme coins pumped like 25% because they realized like the Avalanche Foundation is going to be basically subsidizing meme coins on Avalanche, which is just ridiculous, brother.

• 44:11Ryan Sean Adams?

  So the Avalanche Foundation, the culture catalyst, they're just purging Avalanche meme coins?

• 44:17David Hoffman?

  They're like liquidity incentivizing meme coins on Avalanche because meme coins are taking off on Solana. There's like the whole dog with hat thing. There's like the used card token. There was Bald on Base and their Avalanche is like...

• 44:34Ryan Sean Adams?

  Where does Avalanche get its money? Is this like, is this basically a percentage?

• 44:38David Hoffman?

  From selling the AVAX token. That's where it came from. And they raised money way back when, but I think ever since then, it's been funded by AVAX sales.

• 44:46Ryan Sean Adams?

  Why on earth would you want to like pump the value of meme coins in your ecosystem like artificially?

• 44:55David Hoffman?

  Look, if I don't have anything nice to say, I probably shouldn't say anything at all.

• 45:00Ryan Sean Adams?

  Let's move on.

• 45:03Ryan Sean Adams?

  Oh, Michael Saylor news, David. Do you see this this week? I thought this was absolutely hilarious. So the headline was Michael Saylor sold 216 million of his MicroStrategy stock. And I was, I was looking at this. I was like, ah, we knew he's going to sell. This is how he kind of exits Bitcoin. But it turns out, what is he going to do with the money? He's going to personally buy more Bitcoin. That's what he's doing with the money.

• 45:28David Hoffman?

  Yeah. So, okay. Oh, so Michael Saylor sold 216 million dollars of MicroStrategy stock from his personal supply, which is, he sells MicroStrategy stock all the time. But now you're saying, okay, Michael Saylor himself is just selling his own stock.

• 45:42Ryan Sean Adams?

  Yeah, I just found this hilarious.

• 45:44David Hoffman?

  This is like one of the greatest financial alchemies of this century.

• 45:48Ryan Sean Adams?

  I know, I know. So he, he had

• 45:50David Hoffman?

  It's a perpetual money machine. I don't know how that makes any sense.

• 45:54Ryan Sean Adams?

  He had 216 million of MicroStrategy stock options, right? And so he, he sold all of that. And I was like, okay, well, he's exiting his, you know, MicroStrategy Bitcoin position. And the very next thing he said is he's going to pay off some personal debts, but mostly he's going to just buy more Bitcoin with it personally. And he's got quite the game going. Yeah, he's got quite the game going. So there, there you go. And by the way, MicroStrategy is well on its way to control almost 1% of total Bitcoin supply.

• 46:24David Hoffman?

  It's almost there. Can he stop at 1% please?

• 46:29Ryan Sean Adams?

  Why? That's a lot of Bitcoin. 1% of Bitcoins, bro. He wants all the Bitcoin.

• 46:37David Hoffman?

  Bro, that's so many Bitcoins. That's so many. He's at 9% right now, 0.9% right now.

• 46:43Ryan Sean Adams?

  Yeah, it's absolutely incredible. Anyway, it's Michael Saylor just living out what he believes through his asset purchases here. David, an update from the Terra Luna court case. This has been an ongoing court case. Luna was just labeled a security by a judge.

• 47:01Ryan Sean Adams?

  Okay, on the face of it, very much seems like a win for the SEC and a win for Gary Gensler. So a US federal judge ruled that Terraform Labs violated federal securities laws when it sold its tokens to the public. They didn't register Luna. It also had another token called Mir. It was another Terra token. And I think the SEC is probably going to use this court case as evidence that the courts support their view that, you know, Gary says, all cryptocurrencies are securities. So this, on the face of it, seems like an L for crypto. And, you know, like, we had a lot of wins over the summer with Ripple versus the SEC and Grayscale versus the SEC, of course. This, on the face of it, looks like a loss here.

• 47:45Ryan Sean Adams?

  So Metallawman, as usual, gives a fantastic analysis. And actually, the judge's decision in this case, he said, actually aligns with the Ripple case, which we very much liked. And if you recall, David, in the Ripple case, the investment contracts, the promise of XRP, those were deemed a security, but XRP was in and of itself, the token was deemed to be not a security, not deemed to be a security, right? And so this is similar precedent, basically, with Luna and Mir. Now, there was a little bit of bad news here. So the judge in question in this case also ruled that UST, you know, Luna's "stablecoin," in air quotes, that eventually de-pegged, was sold as an investment contract. And he ruled this because it could

• 48:30Ryan Sean Adams?

  be staked on the Anchor protocol. So it was yield generating. And because it was yield generating, it was hence a security. So Metallawman says that part of the decision is the most spurious a part of the decision. And so the most, like, the part of the decision that could be appealed. The problem, though, is the SEC might use that particular part of the decision against its case with Coinbase. So the SEC is likely to argue that Judge Rakoff, that's the judge in the Terra Luna case, supports the idea that any token in Coinbase that can be staked or earned yield could be considered an investment contract, and that Coinbase's own staking service is an investment contract in and of itself. So

• 49:15Ryan Sean Adams?

  not an absolutely disastrous decision, but not great, particularly on the stablecoin yield front.

• 49:22David Hoffman?

  At the end of the day, it's just one, the 10,000th call to, hey, we need congressional, we need a bill. We need a Congress to do a bill. Cause like, I'm tired of unpacking all of the nuances from all of these court cases because they're all slightly like court decisions, regulation by court decisions is a great stopgap. But if it's the final form of crypto regulation, like I'm going to stay in Argentina.

• 49:46Ryan Sean Adams?

  Yeah. Well, speaking of court cases, David, Sam Bankman Freed will not trial. Actually, I didn't know that this was the case that he had a second trial coming. What would the second trial be for?

• 49:58David Hoffman?

  Is the second trial is kind of for a long tail of charges that they didn't get to in the first trial. The first trial was for like the fraud and collapse of FTX and defrauding customers. And then there's a bunch of other smaller things of which there are many, like market manipulation and like bribes and like all these other kinds of things. And the United States prosecutors was like, well, we kind of got him. So we don't need a second trial. This has ruffled some feathers because other people were indicted, were like implicated in this second trial, including Barbara Freed. And so we could have gotten some

• 50:38Ryan Sean Adams?

  Mom.

• 50:39David Hoffman?

  His mom. Yes, exactly. And so we could have gotten some clarity. We could have gotten more information. Like there are many people who are like, yo, Sam's parents need to go to jail too. And now they will no longer go to jail. They won't be charged because of they were involved in the second trial. So some people are like WTF, there's other guilty people that are out there that this trial would involve. Why aren't they getting their day in court? Because we would like to see them get their day in court. But so like, there's, there's some like kind of dubiousness about it that at least some people are pointing towards. At the end of the day, we will still have to wait for all of that for us to settle. Ultimately, the next really big thing in the Sam Bankman

• 51:21David Hoffman?

  Freed cases is sentencing date on March 28th. So right now Sam is in jail. He is guilty on all charges, all seven charges, which is a lot of things to be guilty for. And now we are waiting to see how many years he will spend in jail. And we will get that answer on March 28. Also, to tie off some loose ends of the 2022 contagion, Barry Silbert and Mark Murphy are stepping down from DCG. Barry Silbert, he's of course the founder and CEO, and Mark Murphy, the president of DCG, have both resigned from the board of directors at Grayscale, taking effect on January 1st. This is part of the submitted filing of the Grayscale Bitcoin Trust with the SEC. Interestingly enough, that the SEC is reviewing. No official reasons

• 52:02David Hoffman?

  were given, but this is most likely to be in support of the approval for the conversion of GPTC into a spot Bitcoin ETF. So Grayscale is like, Barry, get the F out. We need to look good for the SEC. And Barry is like, okay. There's probably other reasons as well. Again, more things like this. We just need more details on, and it's us we'll need to settle.

• 52:23Ryan Sean Adams?

  Yeah, that's probably in Barry's best interest as well, to just clean everything up. So he has the best chance of getting the Grayscale ETF approved.

• 52:31David Hoffman?

  There's a big old hole in DCG's pocket, and they need Grayscale to be as valuable as possible to help fill that hole. So whatever he needs to do to also not get charged with C4R investors, you know, you know the deal. Okay. Are you ready for a new meta in the world of airdrops, Ryan?

• 52:46Ryan Sean Adams?

  Yeah, tell me about it.

• 52:47David Hoffman?

  Okay, so there's a Dimension airdrop. They're calling it a Roll Drop with a bunch of multi-chain criteria. So what is Dimension first? It is what they call the home of Roll Apps, a home for easily deployable, lightning-fast app chains called Roll Apps. Sounds like a Celestia competitor, to be honest. I need to look into this more. But it's a pretty hyped airdrop, and the criteria for getting the Dimension DYN token, I thought was pretty interesting. So if you Are staking Celestia, everything is as of December 19th. So if you were staking Celestia as of December 19th, you got some amount of airdrop. If you were active on Arbitrum,

• 53:30David Hoffman?

  Optimism, Base and Blast by December 19th, you got some. If you were active on Solana, using Solana DeFi before December 29th, you've got some. If you are an Atom delegator on the Cosmos Hub, or if you are an Osmosis delegator on Osmosis, you got some. If you are an NFT holder of a Pungy Penguin on Ethereum, a Mad Lad or a Tensorian on Solana, or a Bad Kid on Cosmos, you got some. So a very wide set of chains and criteria for getting a pretty like desirable airdrop. And I think we're going to see a lot of this moving forward, Ryan. I think this partly answers like why Celestia is like up so much in the last like two weeks ever since the airdrop,

• 54:13David Hoffman?

  when the airdrop went from $2 to where it is now at 15. Part of it is because like Celestia's spitting out like 16% yield, but also I think people are using it as like an airdrop farm.

• 54:24Ryan Sean Adams?

  Yeah, all those criteria that you just mentioned, it's so hard to track. All these airdrops that are coming out, like the best way to track this, this is why we did it. We purchased a tool called Earnify last year, brought that into the bankless ecosystem. You can now access that. It's called the Bankless Claimables app. And all you have to do is plug in your Ethereum addresses, your Solana addresses.

• 54:48David Hoffman?

  Solana addresses.

• 54:49Ryan Sean Adams?

  It will notify you when you are eligible.

• 54:52David Hoffman?

  The airdrops will come to you.

• 54:53Ryan Sean Adams?

  Exactly. Because it is so, it hurts my brain to keep up with all of these different criteria for every single airdrop. And you know, people need an easy button for this because I think we're going to be getting a whole lot more over the coming year. David, this was also interesting. Manta Network? What is Manta Network? They are, are they the new Blast? I heard some mention of that this week. And there's some similarities, but also some differences.

• 55:19David Hoffman?

  Yeah, the Bankless Citizens Discord is all pretty buzzing about Manta Network. A lot of the hype is going around this last week or so. There's this like, marketing graphic that is very, very similar to BLAST. And it's time to ditch other Layer 2s. And then it has their Layer 2 compared to other Layer 2s. And they have BLAST in there, as in like, incentives substantial, which is what BLAST advertised as. Why should you ditch other Layer 2s for BLAST? Oh, because of substantial incentives. And then now they have Manta, which is like, oh, actually, we have two times more substantial incentives.

• 55:58Ryan Sean Adams?

  Two X more substantial?

• 55:58David Hoffman?

  Which is both like, these are all fake numbers. Everyone's just saying like, oh, our incentives are even more substantial than the last ones.

• 56:08Ryan Sean Adams?

  But this is tongue in cheek, right? This is satire, like, they're making a mockery of it. It's all under the column "New Paradigm", right?

• 56:17David Hoffman?

  Actually, this is actually so farcical that this must be facetious. So EVM-compatible, already a live Layer 2, not a multi-sig, which is what BLAST is. Cheaper gas, native yield. So they're doing the native yield strategy. Access to your tokens on this new Paradigm Manta Network, immediate. On BLAST, they have like, in 10,000 days or something IDK.

• 56:41Ryan Sean Adams?

  Yeah, so, okay, so this is basically a Layer 2. And they're claiming it's actually a Layer 2. It's not kind of like a multi-sig sidechain type thing. And a full yield on anything you deposit here, right? Like ETH, USDC, all of these things.

• 56:54David Hoffman?

  I don't want to be seen as promoting this network, but this is just what people are talking about. This is how they're doing it.

• 57:00Ryan Sean Adams?

  Okay, so people can check that out if they want. Very cool. All right, David, well, this has been the first roll-up of the year. Should we end with a meme of the week?

• 57:08David Hoffman?

  Meme of the week, let's do it.

• 57:10Ryan Sean Adams?

  What do we got here?

• 57:11David Hoffman?

  This is coming out of the Bankless Twitter. And it's Elizabeth Warren whispering into Gary Gensler's ear. "The CoinTelegraph intern was unavailable, so we settled for Matrix port."

• 57:21Ryan Sean Adams?

  Okay, CoinTelegraph intern, that seems like so long ago. What happened with that? Remind me?

• 57:27David Hoffman?

  Yeah, so this was a false start of the approvals of the spot Bitcoin ETF. And so the CoinTelegraph, the CoinTelegraph like announced the accepting of the spot Bitcoin ETF way more prematurely than everyone was ready for. But then everyone realized that like, no one was, people weren't exposed to the markets enough because the market was pumped so hard. So it's like this false start that actually did trigger the bull market. We're gonna be hearing about this meme, by the way, for the rest of the bull market. The CoinTelegraph intern started the bull market. And so like now, now with, it was also fake. So like the CoinTelegraph was like, just kidding, that was fake, sorry. And then, and so like now, it's just, it's all about like Bitcoin fake Bitcoin ETF news.

• 58:09Ryan Sean Adams?

  There you have it. This entire bull market was based on a lie from the Telegraph intern. There we go. Thanks so much for joining us, Bankless Nation. Disclosures, I don't think we have anything major to disclose. Of course, David and I own crypto assets. All of our disclosures are always at bankless.com/disclosures. Gotta end with this. Crypto is risky, but so is fiat. So are those Argentinian pesos, right, David? You could lose what you put in, but we are headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the Bankless journey. Thanks a lot.