ROLLUP: Ethereum Burning | Penguin & Axie NFTs | Poly Network Hack | Infrastructure Bill (August 13)

2nd Week of August 2021 ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/ 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ ------ BANKLESS SPONSOR TOOLS: 💰 GEMINI | FIAT & CRYPTO EXCHANGE https://bankless.cc/go-gemini 🔀 BALANCER | EXCHANGE & POOL ASSETS https://bankless.cc/balancer 👻 AAVE | LEND & BORROW ASSETS https://bankless.cc/aave 🦄 UNISWAP | DECENTRALIZED FUNDING http://bankless.cc/uniswap ------ 📣 PoolTogether | Break up with your Lottery! https://bankless.cc/PoolTogether ------ Topics Covered: 0:00 Intro 1:30 MARKETS 2:05 BTC Price 3:04 ETH Price 7:10 ETH/BTC Ratio 9:55 ETH’s Q2 https://www.businesswire.com/news/home/20210804005657/en/Genesis-Q2-Report-Shows-Decreasing-Bitcoin-Dominance-and-Hedge-Funds-Diving-Into-DeFi 13:12 ETH Volume https://twitter.com/geenty/status/1425198900068110338?s=21 14:50 Institutional Demand https://twitter.com/fintechfrank/status/1425586708305829891 15:57 DeFi Action 20:10 Layer 2 Beat https://l2beat.com/ 23:21 EIP-1559 Burned: https://www.etherchain.org/burn Bankless-Inspired Dashboard: https://twitter.com/MSilb7/status/1423314663052218373?s=20 29:54 Axie $1B Volume https://twitter.com/Psycheout86/status/1423719170315800581?s=20 31:38 Coinbase’s Impressive Quarter https://twitter.com/CNBCClosingBell/status/1425186855641829381?s=20 33:00 RELEASES 35:00 Arbitrum in August https://twitter.com/arbitrum/status/1423709666203344899?s=21 38:26 Rarible Protocol https://twitter.com/rariblecom/status/1425840333854711809?s=20 39:17 Gearbox Leverage https://medium.com/gearbox-protocol/hello-world-this-is-gearbox-generalized-leverage-protocol-cbec5f34bb98 41:37 Raises Helium: https://twitter.com/TheBlock__/status/1425255811731894278?s=20 Dune Analytics: https://twitter.com/DuneAnalytics/status/1425821738626019330?s=20 Liquality Wallet: https://twitter.com/TheBlock__/status/1425200897475465220 TaxBit: https://twitter.com/CoinDesk/status/1425825002104922116?s=20 46:34 Jobs https://jobs.banklesshq.com/ 47:00 NEWS 47:16 Poly Network Hack https://twitter.com/polynetwork2/status/1425073987164381196?s=21 Returned: https://www.theblockcrypto.com/linked/114390/poly-network-hacker-returns-nearly-all-of-the-611-million-in-stolen-funds 51:50 Multichain Aave https://cryptobriefing.com/aave-is-exploring-solana-avalanche-layer-2-expansion/ 53:30 Uniswap $1B in Fees https://twitter.com/lucasoutumuro/status/1425172167998779398?s=21 54:20 Gemini Acquires Guesser https://twitter.com/Gemini/status/1425085144436813833?s=20 55:40 Penguins in NY Times https://www.nytimes.com/2021/08/12/technology/penguin-nft-club.html 58:41 FTX Sponsoring Axie Players https://twitter.com/CoinDesk/status/1423274509008875520 59:06 DraftKings NFT w/ Tom Brady https://www.theblockcrypto.com/linked/114064/draftkings-launches-nft-marketplace-with-first-drop-featuring-tom-brady 1:00:29 North American BTC Miners https://www.theblockcrypto.com/post/113861/american-public-bitcoin-miner-btc-july-china 1:01:25 Infrastructure Bill Senate: https://www.cnbc.com/2021/08/11/crypto-lawmakers-fought-over-the-infrastructure-bill-heres-whats-next.html Alabama: https://twitter.com/jchervinsky/status/1423519533990617091?s=21 Treasury: https://www.washingtonpost.com/politics/2021/08/06/crypto-bitcoin-infrastructure-senate/ Jake’s Take: https://twitter.com/jchervinsky/status/1423519533990617091?s=21 1:08:11 Brian Brooks Leaves Binance https://twitter.com/coindesk/status/1423730217357660160?s=21 1:09:37 Circle Becoming a Bank? https://twitter.com/circlepay/status/1424717848400863245?s=21 1:11:00 Happy Yamiversary https://twitter.com/brockjelmore/status/1425307479806824452?s=21 1:13:00 TAKES 1:14:30 Coordinate, Don’t Overreact https://twitter.com/econoar/status/1423483356583370752?s=20 1:16:04 Su Zhu on jpegs https://twitter.com/zhusu/status/1423833467406585860?s=21 1:17:47 David on jpegs https://twitter.com/trustlessstate/status/1424119278085697536?s=21 1:19:05 Eric on jpegs https://twitter.com/econoar/status/1424506591080976391?s=21 1:20:03 Andrew Yang https://twitter.com/AndrewYang/status/1425193106950041600?s=20 1:21:26 What Anthony’s Excited About 1:22:38 What David’s Excited About 1:24:25 MEME of the Week https://twitter.com/BanklessHQ/status/1423503086459359235?s=20 Meme 2: https://twitter.com/TrustlessState/status/1423386503766437888?s=20 1:29:16 Closing & Disclaimers ----- Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here: https://newsletter.banklesshq.com/p/bankless-disclosures

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

• 0:08David Hoffman?

  Welcome Bankless Nation to this Friday edition of the Bankless Weekly Rollup. Another special edition with the substitute teacher of the Bankless Nation, Anthony Cisano. Anthony, welcome to the Friday Weekly Rollup. How's it going, man?

• 0:21Speaker 01

  Hey, mate. I'm going good. Glad to be the substitute teacher again. You know, that Ryan, he's always slacking, right? Like, I'm always gonna have to fill in, but it's all right. I get paid double time for this, right?

• 0:29David Hoffman?

  Yeah, can you imagine just like having a family in crypto? Just like, what a guy. Who does such a thing?

• 0:35Speaker 01

  I don't know how he maintains like that. I couldn't do it.

• 0:40David Hoffman?

  All right, for all the people without kids and vacations, every Friday Weekly Rollup, we go through the markets, what's going on in the market, what got released in the last week, as well as what's going through the news cycle. And then we go through the ecosystem takes, who has some good takes around the world of crypto Twitter. And then lastly, we finish up with what David and Anthony are excited about. Anthony, you ready to get going?

• 1:03Speaker 01

  Yeah, let's get into it.

• 1:05David Hoffman?

  Before we get into the show, we gotta talk about Pool Together, because it is summertime and it's all time to get into the pool. If you don't know Pool Together, it is a no-loss lottery, which means you put your stablecoins, your comp tokens, whatever tokens that Pool Together accepts into a pool, and then you have a chance to win the accrued interest that accrues weekly from everyone's collective funds. So you don't lose your principal, you might lose your opportunity cost of money, but you also might win everyone else's interest as well. It's a fun, no-loss lottery on Ethereum. Every single week, roughly $50,000 to $60,000 gets awarded in USDC, and that is just the USDC pool. There is usually a drawing every single day of the week.

• 1:47David Hoffman?

  They have also recently deployed their Polygon implementation, where you can deposit TUSD tether into the Polygon Pool Together pool. And they are also rolling out their L2s coming soon in the future. So check them out. There's a link in the show notes, so you can have fun in the pool. All right, starting with the markets, Bitcoin coming in at the price of $44,842. Started the week right around $43,500. Anthony, any comments on the Bitcoin price?

• 2:19Speaker 01

  I mean, just generally, the market's kind of trending up. I think people are, I mean, it's funny because I see some people on Twitter talking about, you know, a Bitcoin dominance move and how Bitcoin's gonna like gain dominance into the winter, actually, for the northern hemisphere, summer for me, like towards the end of the year, because you typically see kind of, I guess, Bitcoin dominance increase over that time. But I'm not convinced. I have a different opinion there. Maybe when we talk about the ETH price, I can give my opinion on that.

• 2:44David Hoffman?

  Absolutely. There's always are those people that talk about the cyclicality of crypto markets, and I think those times are coming to an end, if they're not already over. Too many people talk about them. Too many people talk about the cyclical nature of these things. And I don't know, Bitcoin dominance, I've never really been very bullish on that particularly. All right, Ether price, starting the week at around $2,680, coming in at the current price of $3,130, hit a, almost hit $3,300 earlier this week. Pretty much a straight line up and to the right all throughout the week. Anthony, thoughts on the Ether price?

• 3:23Speaker 01

  Yeah, I mean, it's just been funny to see like how quickly we've rebounded. I think we're at 1,700 only, you know, two or three weeks ago, and we've pretty much almost doubled since then, you know, hanging around at the 3100s right now. And this is coming off, obviously, 1559 going live, and people realizing that we're burning a lot of ETH. Like, I don't know why people thought that we weren't gonna burn a lot of ETH, considering that the fees have been high. I always thought that was funny, like, everyone was complaining about the high fees, and then they didn't realize that we're gonna burn a lot of ETH because those fees were high. So I think, you know, people are finally real, you know what I mean? It's just weird. But I think people are finally realizing that, you know, 1559 is, in fact, burning a lot of ETH. And it's not just the only thing that's gonna be affecting ETH price, like over the, I guess, maybe medium

• 4:08Speaker 01

  term. We've got the merge coming up, you know, NFTs have exploded. If you look at the projects burning the most amount of ETH, I'm pretty sure OpenSea is at the top of the list, when usually you would see something like Uniswap up there. So we're seeing, I think, just ETH have like this positive price movement in part because of that. But just generally, like, I mean, the ETH ecosystem's on fire right now. We're gonna talk- Talk a lot about that, but just to go back to what we were talking about before with the seasonality. If people monitor the seasonality of these things, I think crypto is very cyclical and is very seasonal. But I think that's been a big part due to the fact that like it's all been speculative, like a hundred percent speculation for most of crypto's life. Whereas now we're actually seeing the the use cases be adopted in a really kind of real way. Yes, NFTs are full of speculation.

• 4:54Speaker 01

  But a lot of people are actually interested in them building cool new things, doing a lot of different things there. And and kind of like adopting this technology rather than just buying it for purely speculative reasons. That wouldn't be part of a community or whatever. So yeah, I think the cyclical nature over time, over probably the next couple of years is is going to definitely change a lot. We're going to see like definite changes in that behavior.

• 5:15David Hoffman?

  Yeah, the thought that these crypto markets are just going to stay cyclical until like crypto takes over the world and over the universe like no, that's way like. Patterns don't work like that over the long term. What do you make of this? Very straight line from like roughly the 19th of July to where we are almost a month later. It seems to be ether has going on this like very straight up into this up into the right line for the last almost a whole entire month. Do you is there is there anything to to talk about there or is that just a coincidence?

• 5:47Speaker 01

  I mean, it it's hard to tell because some people will call this like a complacency bounce where the price will bounce off it's if it's low after a big crash. And no one will cash out and then, you know, it'll it'll drop down again because everyone was complacent about this. Everyone thought that the bull market was going to continue and all this sorts of stuff.

• 6:04David Hoffman?

  Couldn't that have been like this bounce right here?

• 6:06Speaker 01

  Yeah, I mean, that's the thing. Like, it could have been any of these bounces, right? To me, this is just, so to me, I think two things are playing out right now with the ETH price is disbelief. A lot of people are like, you know, wow, we're already back over 3K. How is this possible? And there's a bit of complacency. We're like, you know, we're back over 3K going straight to all time high. So I think the market's going to do what the least amount of people kind of like expect. And and that's probably go sideways from here for a little bit, maybe, you know, in the short term. While kind of like people change from, I guess, like, I think a lot of people are neutral right now rather than being like over. Really bullish, they're just waiting for like a signal where they're like, okay, let's break out of this kind of like a range here.

• 6:45Speaker 01

  Let's go straight to all time high and all that sort of stuff. Um, but yeah, it's just kind of hard to tell over the short term, but I do think that, as I was saying about the cyclical nature of things, I don't know. I think the four year kind of cycle is like dead. I don't think that's a thing anymore, like really.

• 7:01David Hoffman?

  Yeah. The fact that it continued three times is already telling you that's in my opinion, that's already overextended in its cyclical nature. All right. Moving on to the ETH BTC ratio, we are at point zero six nine on the ETH BTC ratio, which is like I always say, historically pretty high. Like always, if we go back throughout the like, the very beginning of like the whole ether BTC ratio thing, we are at always very high levels. And we have been for basically all of 2021. Anthony, anything to talk about here with the ETH BTC ratio, maybe in the last like few weeks and months or so?

• 7:37Speaker 01

  Yeah, I think the cyclical seasonality kind of plays out here the most with ETH BTC. I don't think too many people trade this pair. I think it's just good for looking at for overall sentiment around like Bitcoin versus ETH and how their prices are going. I think what's going to happen is, you know, I mean, I don't think this is going to happen. I'm actually curious to see what happens in that typically in Q3, more so in Q4, ETH Bitcoin bleeds like, and it bleeds hard, right? It basically makes Ethereum feel like shit for like all of Q4. And then in late December, early January, it typically explodes upwards again. Like there's that kind of like bounce because everyone's kind of like,

• 8:15Speaker 01

  feeling really shitty and that's kind of like the typical place to bounce. But if you pay attention to what's been happening with ETH Bitcoin and kind of like seeing the change there. I don't, I'm not convinced that we're going to see this play out again. Like it's played out pretty much every year since Ethereum's existed, like since ETH was trading. But if we break this cyclical nature, I mean, you can look on the chart and see that it's played out every single year, like every single Q3, Q4, ETH Bitcoin has bled, um, you know, since the earliest days. Then it's bounced after that. But like if we don't bleed now, if ETH actually takes, it's, you know, if ETH Bitcoin doesn't bleed and it either goes sideways or keeps going up, that will show the entire market that there really is a real change and shift in how people

• 8:58Speaker 01

  are viewing ETH as a standalone thing compared to Bitcoin. I think more and more people are realizing that Ethereum as a network does just obviously so much more than Bitcoin does, and we shouldn't be comparing the two, you know, in lots of different ways. So yeah, I just think that if we do break that seasonality, that is an absolutely massive break of pattern. And I mean, that's breaking like six years worth of patterns. So yeah, it's a pretty big deal if that does play out there.

• 9:24David Hoffman?

  And the reason why I think Anthony and I are focusing on this whole cyclical theme in the market section is that we see a lot of just excitement in the news cycle. We see a lot of adoption and there's a discrepancy between what this cyclical pattern of crypto market history would predict for the next quarter or so and what we are seeing when it comes to on-chain fundamentals and things just like in the news cycle and the rate of adoption, which is going to be something that we revisit throughout the rest of this weekly roll-up. So stay tuned for that. But actually, we are going to get to one of those subjects right now. Coming out of a business wire, which is apparently a Berkshire Hathaway company, a Genesis Q2 report shows decreasing Bitcoin dominance and hedge funds diving into

• 10:09David Hoffman?

  DeFi. So this is one of the fundamentals that we are seeing that would disagree with the nature of the cyclical nature of the markets as we've seen so far. Genesis, a digital asset industry provider and digital currency prime brokerage, released its Q2 2021 Market Observations Report, which highlights major trends across institutional digital asset markets. The report shows a significant rotation out of Bitcoin and into Ethereum and explains how clients' search for yield drove activity across Genesis throughout Q2. Man, it's as if some of the core Ethereum community members were talking about this. They would look for the past like year or so. Institutional investors, institutional money, they love yield.

• 10:52David Hoffman?

  And that they love the narrative that surrounds around yield. And we all know that they were largely un- not sufficiently exposed to Ether and overexposed to Bitcoin, because everyone started with Bitcoin, right? When you only start with Bitcoin, you only have other places to go. And when you see like the next step after Bitcoin is perhaps this thing called Ethereum, and there's all these yield opportunities on Ethereum, that just makes a ton of sense to me. Anthony, what are your thoughts?

• 11:19Speaker 01

  Yeah, I mean, we've been talking about this for years at this point, like both of us, you know, wherever, on Twitter, on Bankless, on ETH, whatever it is. But essentially Ethereum just appeals to so many more people than Bitcoin does. Like, what you do with Bitcoin is you buy BTC and you hold on to it, right? There's not much else you can do with it. Maybe you can put it in some kind of like centralized custodians to earn a little bit of yield on it. But a lot of the time that we earning yield on it by putting it into Ethereum. So it's kind of like ironic when you think about it like that. So I'm not surprised to see this at all. I've been a long-term proponent that I think Bitcoin dominance is going to fall dramatically from here and probably fall to under 10% eventually. I think that the space is much bigger than Bitcoin. It is even bigger than Ethereum.

• 12:02Speaker 01

  Like, I don't think Ethereum is going to be the absolute kind of like juggernaut and everything else will be like this tiny little thing. I do think we're going to be in kind of like this. I mean, I guess people are calling it like a multi-chain ecosystem, but I do think a lot of that value is still going to accrue to Ethereum, right? Like Ethereum as it's kind of like the base chain and as this economic nexus that sits in between everything. And from that point of view, I think a lot of people realize that. And so with, especially with 1559 in place now, people are like, well, how do I get exposure to all of this? Well, you know, you buy ETH, right? You buy ETH to get exposure to everything. Doesn't matter if, you know, this DeFi app is hot one, you know, one month, this DeFi app is hot another month, or, you know, same with NFTs, you get exposure to the entire Ethereum ecosystem by buying ETH. And then with that ETH, you can choose to stake it,

• 12:46Speaker 01

  or you can put it into DeFi, borrow against it, you know, and earn some yield on stable coins. And there's an infinite amount of things you can do with Ethereum. And if you're trying to bet on, I guess, like a falling Bitcoin dominance, because you're betting on like the world kind of waking up to things like DeFi and NFTs, well, then you kind of like buy ETH here. So I think we're going to continue to see this. I don't think this is an outlier. And I'm just, I'm very happy to see institutions finally realizing the value of ETH and Ethereum.

• 13:13David Hoffman?

  Absolutely, and this is also backed up by the fact that Ether had its first whole entire quarter having more volume on Coinbase than Bitcoin, which is a pretty monumental milestone. A whole entire, one-fourth of a whole entire year Ether trading volume is higher than Bitcoins. And as we all know, in the world of crypto, there is a competition to be the internet money, and money means liquidity. And so seeing the volume shift from Bitcoin to Ether for a whole entire quarter tells us a new story about where the liquidity in this industry lies.

• 13:47Speaker 01

  Yeah, exactly. And I think it's interesting to see how dramatic the shift has been in only a year. Like, a year ago Bitcoin was 57%, Ethereum was only 15%. And now, if you go back to the other, kind of like screenshot that I was reading off, yeah, yeah, yeah.

• 14:04David Hoffman?

  I hate it when Ryan does that to me.

• 14:07Speaker 01

  And Bitcoin is now 24%, whereas Ethereum is 26%, then has not only been like a massive catch-up from Ethereum, and you can see like the pattern, it basically played out mostly in Q1 and Q2. But you know, Bitcoin's lost a lot of dominance to other crypto assets as well, because other crypto assets over the last year have increased from 28% to 50%. So obviously, people are just like very, very excited to trade other assets, very interested in trading other assets. And ETH is like the big, I guess, like one of the biggest beneficiaries of this. And we felt that with the price as well, with the ratio going up too. Like, as I said, I don't think many people trade ETH BTC, but ETH BTC tells the story. And it tells the story of ETH dominance increasing while BTC dominance decreases.

• 14:50David Hoffman?

  And then we also have this tweet coming out of Frank Chaparro from The Block. "Institutional demand for ETH has surged, and it's pushing Fidelity and NIDIG to expand their BTC-focused offerings." NIDIG, which is known for one of the biggest Bitcoin funds ever, and it's one of the reasons why so many commercial banks can tap into Bitcoin via NIDIG. "NIDIG, which bills itself as BTC first, has quietly been offering ETH custody to an increasing number of clients, plus FDAS could offer ETH services by Q4 or Q1 2022." So this is kind of like, wow, there was so much going on this week with the whole like

• 15:29David Hoffman?

  regulatory tax stuff, the penguins. There's been this underlying story of just like institutions quietly rotating and finding infrastructure and rotating into Ether.

• 15:42Speaker 01

  Exactly. Yeah, I mean, I, it's funny, like, I responded to Frank's tweet there saying, like, it doesn't pay to be a BTC maxi shop, and it doesn't, right? You, you eventually have to K because your customer demand is so high.

• 15:54David Hoffman?

  There's revenue sources elsewhere. Why not go them? Go, go to them. All right, turning now to money locked in DeFi. We are coming in at $79 billion locked in DeFi, which is about roughly where it started a week ago, but has been a lot higher where than it has been all throughout July. So really coming back into the, that high 70s, low 80s range, which again, we, I believe we capped out at 88 or 90 billion dollars locked in DeFi. And of course, the DeFi Pulse Index coming in at $390, starting the week at around $350, peaked out at over $400, $415, and then we are currently at the price of $390. Anthony, any comments on money locked in DeFi or the DPI?

• 16:39Speaker 01

  Yeah, so the, the money locked in DeFi, measured in USD is going to trend up based on the market, right? Because a lot of it is ETH, a lot of it is Bitcoin and other kind of tokens. So obviously it's going to go up and the market goes up. But I think DeFi, you know, the last, I mean, maybe a couple of months has taken a backseat because NFT mania is kind of what everyone's talking about. But DeFi is quietly building in the background. There are a lot of things going on and it's not going anywhere. And I think we're going to see like a DeFi Renaissance happen over the next few months, especially as these layer twos go live and more and more people kind of like can play with these things. I think we're definitely going to see a resurgence here. And I wouldn't be surprised to see 100 billion plus locked in DeFi very, very soon.

• 17:17David Hoffman?

  Yeah, that will be a fun day to, to be in DeFi, that's for sure. You can definitely see that number be tweeted out on Twitter if you don't want to miss it because there will be a race for all the Twitter influencers to get that first 100 billion locked in DeFi. We all know it's coming. All right, moving on to the DPI Ether Ratio coming in at 0.2126, a little bit below my 0.13 call, but again, not all that far away. It is below the call. I will not, I will not deny that. But Anthony, do you have any comments about this ETH DPI

• 17:51Speaker 01

  Yeah, I mean.

• 17:52David Hoffman?

  Doesn't look so hot.

• 17:55Speaker 01

  So, so I have a, I have a thesis at the moment that I, I'm wondering if it's going to play out. It seems to be playing out already, but I think that in a post 1559 world, outperforming ETH over the long term is going to be very, very hard, especially, you know, maybe like the blue chip DeFi things and stuff like that, that things are already kind of large cap. It's going to be very hard for them to outperform ETH over the long term, I believe, because of the fact that all the activity generated by DeFi is going to feed back to ETH anyway, because we're going to be burning ETH because of it. So, you know, and a lot of, and, and because we have so many DeFi tokens now, I think buying the DeFi Pulse Index is still a really good idea for people who don't want to sift through all the, all the DeFi tokens. But if you kind of like, look at it from the point of view of maybe like the complete

• 18:39Speaker 01

  normie who sees everything going on, they're like, okay, well, you know, there's DeFi's, NFTs, like, I don't know what to buy, like, what do I buy? And then they think to themselves, well, this is all happening on Ethereum, why don't I just buy ETH as like the shelling point index sort of thing for the entire Ethereum ecosystem? And I think that's going to be a big reason why, why over the long term, say like, you know, a year plus, it's going to be very hard to outperform just, you know, holding vanilla ETH, or even like, maybe, I guess, like you guys have the bed index, like Bitcoin, ETH and DeFi, which I think is, is, is, is less volatile. So it's something that people will be interested in as well. But, uh, yeah, the, the DPI ETH ratio is not looking too hot, but at the same time, it can always reverse very violently if for some reason, people like, all of a sudden say, oh, well, DeFi is on the price, I'm going to buy DeFi, then over the short to

• 19:24Speaker 01

  medium term, it can definitely outperform.

• 19:26David Hoffman?

  Right, we are, like Anthony said, we are in the middle of what seems to be an NFT hype session. If that session were to ever turn to DeFi, things would move really, really quickly. This is kind of how this industry works is we are only ever extremely hyped or extremely subdued, never ever in the middle. You mentioned the bed index and the bed index is coming in at $142, has performed really well for basically all of its genesis, started the month right around $90 and then has peaked out at $153 and on the week, we are up 8. 6%. So as an industry, which is why the bet index is so great as a whole entire industry,

• 20:06David Hoffman?

  we are roughly up 8.6%. So that is pretty cool. All right. Here is L2B and we haven't talked about L2B for a while, even though that we have it in the show templates. But the reason why I wanted to bring it up this week is A, we haven't talked about it in a while, but we were going through a little bit of a downtrend in money locked in layer two. So, excuse me, L2B is kind of like DeFi Pulse. It's like, you know, money locked in DeFi, but instead it's money locked on layer twos. And we have been seeing a resurgence in some value in some deposits coming in at layer two, largely because I think the DYDX token, DYDX coming in at number one. And over the last seven days, it's had 160% extra value being deposited into its L2. But of course,

• 20:51David Hoffman?

  we are also seeing a strong showing by optimism and a few other layer twos as well. Anthony, any comments on the layer two world?

• 21:01Speaker 01

  Yeah, I mean, you can see with DYDX, this is the power of adding a token, right? Like as soon as you add token incentives, you get a lot of liquidity. And I'm really glad to see their growth there. I think they're one of the best L2s out there right now, obviously built on Starkless technology, has a really great platform. But like, I'm always curious to see how these things perform when there isn't token incentives in place. So I've been watching something like optimism where they've got Synthetix and they've got Uniswap. But I've in particular been watching Uniswap V3 on optimism because Synthetix has token incentives technically because of the staking. So with Uniswap V3 on optimism, there's zero token incentives on there. So I've been really curious to see that. Oh, sorry. Very happy to see that the TVL has been

• 21:42Speaker 01

  growing steadily on there and the volumes. I think they peaked out at maybe over 4 million 24 hour volume, which, you know, is small when you consider a layer one is like in the billions. But, you know, as I said, no token incentives, still very new, very limited guardrails everywhere. And, you know, we have other L2s like Arbitrum going live this month, you know, in a fully public fashion. So I think this TVL is going to explode. And I think the early TVL that they're measuring here might have been just like all synthetic staking. And when the SNX price was like three times what it was now, you know, and that was, I think that was on optimism, but for a little while too earlier on, just staking. But like, I'm just looking at the 30 day, if you change to the 30 day chart.

• 22:23Speaker 01

  On on there. Yeah, you can see that the trend is is very strong like we've basically like, you know, almost pretty much doubled here, you know, and I think that's just going to keep continuing and it's just great to see. And then there's a lot of ETH locked in there as well. I think that's measuring ETH if it was priced in USD there. But I'm being seeing like ETH locked in in L2s go up as well. Like, DTX is a big kind of like a big driver of that for sure.

• 22:48David Hoffman?

  Yeah, and we did have the optimism team on the Bankless show last week. If you did not catch that episode, absolutely go watch it. It's not often that optimism comes and talks on a show. We did ask them if they were going to do a token, because Anthony, I'm pretty sure you agree with me, we kind of think everyone's going to do a token.

• 23:06Speaker 01

  Yeah.

• 23:07David Hoffman?

  But when they answered that question, they said that they had no plans. So they no plans to do token.

• 23:13Speaker 01

  No plans yet.

• 23:15David Hoffman?

  Well, they didn't say that, but we totally will. All right.

• 23:18Speaker 01

  No, yeah, no, yeah, yeah, for sure.

• 23:21David Hoffman?

  Now, in the new to the Bankless weekly rollups and also continuing for all future weekly rollups, we are now seeing 36,000 Ether get burned since EIP1559 got introduced a little bit over seven days ago, seven and a half days ago. So in the last seven days, $36,000 or excuse me, 36,000 Ether was burned, which is coming in at $111 million. Fun tracked roughly about three and a half Ether per minute for over the last 24 hours. Anthony, did you see this Ether burn thing coming? Like, did you know about this?

• 24:01Speaker 01

  No, like, this is this has caught me by surprise. Like, I am so totally surprised. Like, where did this come from? Like, this 1559 thing? It's just came out of the blue, right?

• 24:11David Hoffman?

  Oh, but okay, but did you think that it was going to burn this much ETH?

• 24:16Speaker 01

  Yes, yes. I mean, I've been obsessing over this for a very long time and I've been screaming about it. Because Justin Drake put out his assumptions, saying that 70 to 75% of the ETH fees would be burned. And that's exactly where we are today. It's about 75% on average. So he was, he was right about that. And I based a lot of my assumptions on his work. And, you know, given how much work he's done throughout the ecosystem with research on Ethereum monetary policy, 1559, everything like that, I tended to kind of like believe his estimates. And, you know, when I saw this happening, I was like, yeah, this is, this is exactly what I, what I expected. But a lot of people didn't. And it just really surprised me because, I mean, maybe a lot of people don't watch my stuff. But, I mean, I've been screaming about this for so long.

• 24:58David Hoffman?

  I really like this watchtheburn.com website. Over the last seven days, it's been keeping a tally of the burned versus issued amount of ETH. And this is one of the metrics that I talked about forever ago, the ETH issued to burn ratio. In the last seven days, we've issued almost 67,000 ETH and we've burned 35,800 ETH. So we are burning more than half of the issue of the ETH that we are currently issuing. And that is in a proof of work environment, right? So actually, excuse me, we burned 35,800 ETH and then the net issuance was 66,800. Okay, so, so we actually only burnt roughly 35%.

• 25:41David Hoffman?

  And so, you know, 35%, like no, like, and that is largely ETH that would be otherwise being sold by miners. And so 35% of Ether being issued is no longer being sold, it is just being burnt. It's as if people saw this coming.

• 25:57Speaker 01

  This fits in with my napkin math about how if we wanted a full net deflationary ETH in a proof of work world, we would need about 150 Gwei on average. We've had, I think, about 50, 60 Gwei on average over the, over the past like seven days. So yeah, it's not going to be net deflationary, but we have had ultrasound blocks, right? Which is a blocks where we've burned more ETH than we've, that we've issued as block reward. And we've had many of those, which I think is really cool to monitor. But, I mean, yeah, like. The thing is, is that it's funny because I've been seeing people say, oh, well, you know, how much ETH was issued during that time? Like, who cares how much was burned? How much was still issued? And it's like, guys, like, this is like so missing the point right now. Like, it's just, it's insane. But like, other than that, I just think it's funny when you look at the dollar

• 26:39Speaker 01

  values too. Like, there's $10,000 on average over the last 24 hours, each minute being burned with ETH. So don't just look at the ETH value, look at the dollar value. $10,000 a minute. That's like someone buying $10,000 every minute and sending it to the burn address. It's the same thing.

• 26:53David Hoffman?

  At this rate, it's faster than Michael Saylor is Dollar Cops averaging into Bitcoin. And the crazy thing is, is like, you said that we've had ultrasound blocks. We've also had ultrasound hours, as in for a whole hour Ether was deflationary during dependent, like, times of NFT drops usually. But, I mean, in DeFi summer, we sustained over 150 Gwei for weeks, if not months, right? And there was times where we were holding 300 to 400 Gwei for an entire week, right? And so, to some degree, like, when we have a really, really high congestion environment, like, that burns way, way, way more Ether. And like, does it retro, like, if we want to retroactively become ultrasound, that is possible, right? Because, you know, the maximum

• 27:35David Hoffman?

  amount of Ether that you can burn inside of a single block is infinite, right? And so, you know, the maximum amount of Ether you can burn in a single month is also infinite, right? And so, and of course, this just gets so much easier under proof of stake. You said you're knapping mass with like 150 Gwei. Well,

• 27:52Speaker 01

  I think it was like, the proof of stake, I think it was like 10 to 15 Gwei or something, depending on the ETH stakes, yeah.

• 27:58David Hoffman?

  10 to 15 Gwei. Like, we've been sustaining 10 to 15 Gwei, like, 97% of the time for the last, like, two years.

• 28:04Speaker 01

  Yeah, yeah, exactly. So, yeah, and this is why I think, I've been saying it on Twitter, leaking a bit of alpha, the merge is like 100 times more bullish for ETH than 1559. Like, 1559 was like the appetizer, guys. Like, the merge is the main course. Like, it's the main course, it's the dessert, it's the drinks you have with. Your food, right? It's everything. It's huge.

• 28:24David Hoffman?

  Yeah. And the cool thing is that we can actually do a little bit of like, again, napkin math here is like, so we call the merge the triple halving, right? Because it's having the amount of issuance of ETH and then doing it again and then doing it again. So what is that? 50, 25, 12.5%?

• 28:39Speaker 01

  It's about a 90% reduction.

• 28:41David Hoffman?

  90% reduction?

• 28:43Speaker 01

  Which is triple halving. Like if you halve it 50%, 50%, 50%, it's about 90%.

• 28:48David Hoffman?

  Right. And then with this burn rate, we are burning, I think, oh God, this is why I'm not a math major. But anyways, take a third of the issuance of under this proof of work form and then also keep on burning that. Like, these things are really symbiotic. Okay, all right, we gotta move on. We're gonna stick into the markets for a little bit too long. But before we do, a shout out to Michael Silberling, which he was listening to the EIP1559 expert panel, which is another great piece of content, and made this Dune Analytics board, which I found very, very useful, but apparently it's not loading. But if you want to get a very in-depth Dune Analytics board about EIP1559, check out that link in the show notes. Shout out to Michael for making that Dune Analytics board.

• 29:34David Hoffman?

  And then again, I guess we're not done with EIP1559. Here's a nice visualization of all the ETH being burnt versus the ETH being paid to miners. Like, look, the dark blue is how much is being burnt and then the light turquoise-ish is revenue paid to miners. And there's a lot of dark blue there. Like, it's most of it. Moving on to Axie Infinity, which is the first NFT project to hit $1 billion in all-time NFT trading volume. It's a very large number, absolutely massive. Axie Infinity, we brought them on to the markets a couple of weeks ago because the price was just going absolutely bonkers. And we brought that on after, two weeks before that, we brought them on the show because the price was

• 30:18David Hoffman?

  going absolutely bonkers. And the revenue of this whole entire ecosystem continues to be sustained, which is very, very impressive. Anthony, any comments here?

• 30:28Speaker 01

  Yeah, I mean, this is just like, to me, the story of Axie Infinity is what's going to bring in the kind of like next wave of NFT, kind of like, you know, adoption and builders. Because think about all the game development studios that have now realized how big the total adjustable market is for play to earn games, and think about all of them integrating these sorts of things into their mobile apps, right? Like, there's a lot of apps with in-app purchases and stuff like that, but they're going to be able to supercharge it by tapping into these play to earn things. So I'm gonna, I can pretty much guarantee that every single game company worth its salt right now is contacting, you know, whether that be Ethereum layer twos that are focused on NFTs, or anyone who knows about this stuff, they're contacting

• 31:09Speaker 01

  them to, like, the team at Polygon as well and stuff like that, to say, hey, hey, how do we do this NFT thing? And you're gonna see an absolute explosion of this stuff happen over the next six to 12 months. It's gonna catch everyone off guard. I think this NFT mania is just getting started. There is so many people to come, like, the amount of people that there still is to come in is incredible. Like, this is gonna be the story, I think, over the next six to 12 months, for sure.

• 31:34David Hoffman?

  Yeah, absolutely. And we have not even gotten to the NFT section of the weekly roll-up. To close out the market section, Coinbase, Coin, had a really impressive quarter. And so they beat earnings. They were expected to have $1.8 billion in revenue, but instead they pulled in $2.2 billion of revenue. And Coin, as a result, is finally seeing some life in the asset price. So congratulations to Coinbase. Anthony, any comments here?

• 32:02Speaker 01

  Yeah, I mean, it's great to see. But like, my thesis has always been that Coinbase is very, very heavily reliant on crypto trading volumes, and crypto trading volumes go up when the crypto market is hot. So just buy ETH and you'll outperform Coin.

• 32:17David Hoffman?

  All right, guys, that was the market section. We are going to be back with releases in just a second. But first, a moment to talk about some of these fantastic sponsors that make this show possible. Bankless is proud to be supported by Uniswap. Uniswap is a new paradigm in asset exchange infrastructure. Instead of a cumbersome order book system where trades are matched with other humans, Uniswap is not. Autonomous piece of software on Ethereum, which is what Ryan and I call a money robot. No human counterparties or centralized intermediaries, just autonomous code on Ethereum. Input the token you want to sell and receive the token you want to buy. Something brand new in the Uniswap ecosystem is the Uniswap Grants Program is now accepting applications for grants. We have been saying this for a while and we'll say it again.

• 33:01David Hoffman?

  DAOs have money and they are in need of labor. If you think that you have something to contribute to the Uniswap DAO, apply for a grant to Uniswap. Just look at the size of the Uniswap Treasury. It's almost $3 billion. This mountain of capital is looking for labor. Do you have something of value to contribute to the Uniswap DAO? No matter how big or small your idea is, you can apply for a UniGrant at unigrants.org and help steer Uniswap in the direction that you think it should go. That's exactly what we did to get Uniswap to be a sponsor for Bankless and you can do the same for your project. Thank you, Uniswap, for sponsoring Bankless. Balancer is a powerful platform for flexible automated market makers. Typical AMMs just have two tokens inside of one liquidity pool,

• 33:45David Hoffman?

  which can lead to fractured liquidity across the many pairs in DeFi. With Balancer, you can access the full power of multiple tokens inside of one single AMM, which unlocks an entirely new playing field of possibility. This makes Balancer an awesome building block for so many different use cases. Balancer pools can make asset indices, but instead of paying fees to portfolio managers, Balancer lets you collect the fees from traders who use your portfolio for liquidity. Additionally, Balancer smart pools can be programmed to have properties that change according to predetermined rules, such as changing the swap fee based on market conditions, or even liquidity bootstrapping pools, which can help you launch and distribute your token with day one liquidity. At Bankless, we use a liquidity bootstrapping pool to sell our BAP t-shirts to much success.

• 34:29David Hoffman?

  Balancer V2 brings powerful new features that makes your money work even harder for you. In V2, idle tokens are capable of generating yield in DeFi without sacrificing liquidity in the pool using Balancer's asset managers. Balancer's Vault Architecture lets you trade between balancer pools at a fraction of the cost versus trading on other platforms. Balancer's mission is to become the primary source of liquidity in DeFi by providing the most flexible and powerful platform for asset management and decentralized exchange. Dive into the balancer pools at app-balancer.fi. Alright guys, welcome back. We are getting into the releases and starting alphabetically.

• 35:09David Hoffman?

  A is for Arbitrum and apparently A is also for August and apparently Arbitrum is releasing in August. So they recently put out a blog post on their blog on Medium, offchain.medium.com if you want to go check it out, talking about how they are going to release Arbitrum in August. Anthony, what month is it?

• 35:27Speaker 01

  I think it's August. Is it August?

• 35:30David Hoffman?

  I think it's August.

• 35:31Speaker 01

  It's turning out to be a very big month for Ethereum.

• 35:33David Hoffman?

  Yeah, weird. Alright, so what does that mean for us? What does that mean for Arbitrum to go live?

• 35:39Speaker 01

  So Arbitrum 1, which is their first implementation of the Arbitrum optimistic rollup, going live means that it's going live for everyone. It's been on mainnet in a kind of like closed capacity for developers to deploy their kind of apps to them, but it going live in August for end users means that we're going to all be able to use the Arbitrum system from our favorite Ethereum wallets. So that is super exciting. And I mean, August, what, we're on August 13th for me and then it's the 12th for you, but essentially there's only a couple of weeks left of August. So they're going live sooner rather than later. They're going to leave it to the end of August to really tease us, you know, who knows? But I think Arbitrum is usually very good with their dates and their release windows, so I don't expect a delay here. So yeah, they're going live in August, so super exciting.

• 36:24David Hoffman?

  I really like this release date format and I really wish that as a community we had figured it out earlier, just give people an entire just like month, like no release dates, just give us a month and just like tease us for a whole entire month. Arbitrum also released this page, which also illustrates all of the apps that are coming to Arbitrum. This page is called the Arbitrum 1 Portal, your gateway to the Arbitrum ecosystem and the amount of applications on here continues to just grow and grow and grow as I zoom out on this page. Look, there's Ave, there's Curve, there's Cream, there's, gosh, there's Balancer, look at that, there's Chainlink, EtherScan, not even an Ethereum app, Ethereum infrastructure, which we all know that we need, there's MakerDAO, MC Dex, Loopring, gosh, what isn't there?

• 37:07Speaker 01

  Yeah, yeah, this is, this is why I'm, I'm really, really excited for this is because we're going to have a fully kind of like fleshed out, uh, layer two, uh, ecosystem with Arbitrum going live, where we have all the apps we know and love from layer one and just on layer two. So I expect, uh, the TVL and, and the activity to absolutely explode on this. And I, I'm sure optimism isn't far behind either because Arbitrum is their main competitors, um, in the optimistic roll up space. So I'm pretty sure we're going to see like the Arbitrum versus optimism wars over the next few months. And it's going to be amazing. There's going to be so much kind of like liquidity mining going on. It's going to be pretty funny to see how that plays out. But yeah, I mean, I can't wait. Like first, um, you know, true layer two, uh, ecosystem on Ethereum, uh, that isn't just like app specific.

• 37:51Speaker 01

  Like obviously DYDX, Loopring, Diversify, all that sort of stuff is app specific, specific, but Arbitrum one and, and optimism are both, uh, generalized EVM compatible platforms that are going to really change the game, I think.

• 38:04David Hoffman?

  Yeah. And as we've been saying on the Bankless Show, the layer two summer is upon us. August still counts as summer, so we still got that one right. Uh, and if Arbitrum does what we think they do and releases a token, maybe there's yield farming on Arbitrum. I don't know how they're going to release their token. I don't even know if there is going to be a token, but I would imagine there might be some, uh, aggressive yield farming going on there. Uh, moving on to Rarible, release the Rarible Protocol, a set of tools to simplify the go-to-market process for NFT projects and ideas. I took a peek under the hood and this is, uh, interestingly, an NFT cross-chain system to bridge NFTs across all the various chains, uh, not even just the Ethereum L2s, but also things like Binance Smart Chain and, and Flow and Peso, which, uh, interesting.

• 38:48David Hoffman?

  Okay. Uh, Anthony, did you read this announcement at all?

• 38:51Speaker 01

  Yeah, I mean, I saw it last night. Uh, basically, I mean, it makes sense because essentially what Rarible is trying to do is to provide the tools for, for people to kind of like build out their NFT projects and developers to kind of build them out on Ethereum, layer twos, other chains, things like that. And, uh, yeah, I mean, it definitely makes sense for them to release something like this, but I think it's definitely more developer focused right now, but end users are obviously going to get the benefit from that, uh, at the end of the day.

• 39:17David Hoffman?

  Coming out next was Gearbox, which is a brand new protocol for generalized leverage. I'm not sure what that means to have it generalized leverage. And if there is a, somebody who is a trader in the world of the bankless nation, who wants to come in and inform me what generalized leverage is, I would super duper appreciate it. Anthony, do you know what that generalized leverage is?

• 39:38Speaker 01

  Yeah, so the way that I understand it is basically you're gonna have like a pool of capital that people can kind of like tap into, that they can kind of leverage off of, right? To go do kind of like yield farming and similar things within the ecosystem. So I think the way maybe Gearbox does it is, you know, you can see in the screenshot here, they have like this pool, right? Where liquidity providers can provide liquidity to. And then people create these things called credit accounts, which they borrow from the pool as leverage. And then they go do, you know, any number of things. So it's essentially a way to access like a massive pool of capital for people who want it and to borrow, to kind of leverage it in order to do the other things in DeFi. So I thought this was actually a really cool idea because I think Alpha Finance has done this in the past

• 40:20Speaker 01

  in a different implementation where people could like borrow from this pool of liquidity. But I think Gearbox is just taking it to the next level by introducing this thing called credit account, where it's essentially, you know, keeping track of all the credit that this person has and generalizing it so that they can borrow, you know, leverage this liquidity and put it into all these other protocols. And you can see here, on the other side, there's like a two-sided place here. There's the liquidity providers, then the traders. And there's this credit account that everything goes into and the traders can kind of leverage that. And yeah, I mean, the post detail is a lot more kind of like how this, how this works. And there's like a little blurb underneath the screenshot that describes it. But yeah, I think this could be pretty, I think this could lead to, you know, a resurgence in DeFi especially. Because at the end of the day, everyone loves yield farming.

• 41:03Speaker 01

  And, you know, making it easier for people to leverage yield farm is probably, you know, gonna be a hot product, especially if DeFi heats up again.

• 41:11David Hoffman?

  Yeah, as we all know, the DeFi is providing some of the most powerful financial tools to the people that use it. And we are also inventing brand new ones, which gets even crazier. So I'm excited to see how this rolls out into the future. What can this change when it comes? Because you all know, everyone in DeFi loves leverage, perhaps a little bit too much. I'm a little bit worried about putting even more leverage tools out there. But like, I know that if they can be built, they absolutely will be built. And it looks like that's what's going on here.

• 41:38David Hoffman?

  All right, moving into raises, the decentralized wireless network Helium has raised $111 million in a sale led by A16Z. Anthony, any comments on this?

• 41:50Speaker 01

  Yeah, Helium is one project that I've watched for quite a while. I haven't been able to participate in it. Yeah, yeah, I wasn't able to participate in it from the early days because they were only shipping their Helium units to places in like the US initially. And then I think they do Australia now, but I haven't I haven't kind of looked at it lately. But for those who don't know, Helium is trying to create like a decentralized, I guess, like 5G network. And so to do that, you need to obviously bootstrap it with new hardware. And hardware, a hardware rollout is actually very, very hard and very expensive. So what Helium has done is basically said, well, what if we have a token attached to it? What if we do like mining where you set up your unit, you get to mine these H and T tokens? And then that kind of incentivizes you to do so.

• 42:31Speaker 01

  And I really think that this is going to be part of a broader trend where we can actually use these token incentives to essentially bootstrap new kind of like hardware rollouts. And there's no surprise to me that Helium has raised this amount of capital because they are, you know, there's literally like tens of thousands of these things. And they actually were sold out for quite a while because there was just so much demand for them. So this is really like liquidity mining for hardware rollouts. Like that's what I like to think about it.

• 42:56David Hoffman?

  And I definitely have always thought this is one of the most like sci fi applications of the use of crypto. But we've also seen teams try and do similar things like this before. The Foam network comes to mind where the people wanted to make like decentralized triangulation. So we didn't have to like rely on Google Maps. I mean, we all want super high speed connectivity and a mesh network of like radio. I'm pretty sure that's the right device. Makes a lot of sense. Is society ready for that? We will find out, but we have $111 million to put to the test. So moving on, Dune Analytics, which we refer to all the time on the Bankless program, got a $8 million Series A led by Union Square Ventures.

• 43:39David Hoffman?

  I'm really, really excited for this. Dune Analytics is such an important way to gain some perspective as to what's going on directly on-chain on Ethereum. And their boards feature is great. We use it all the time on the rollup. I'm excited to see what happens when they inject $8 million into improving the product and growing out the team.

• 43:58Speaker 01

  Yeah, I mean, this is awesome to see. And I mean, I should disclose that I'm actually a seed investor in doing analytics.

• 44:03David Hoffman?

  Congrats.

• 44:04Speaker 01

  Yeah, yeah, thanks. But this is like awesome to see like from both ends. But one, because like I'm really glad to see that a team that I I have backed is, you know, going on to raise another round and seeing continued success. But also because I'm a massive fan of doing analytics. I use it every single day for looking at on-chain stuff. And I absolutely love the fact that they have such a vibrant community that builds all these awesome dashboards. I mean, we showed one from Michael earlier. There's literally hundreds of these people building out these dashboards. And I think with this money, doing said that they're going to expand to layer twos and other chains and kind of just have like this world of of data for people to kind of like tap into to to essentially build these dashboards around. So yeah, I'm really, really excited to see that they've raised this money.

• 44:43David Hoffman?

  Closing out the raise section, we have a consensus incubated crypto wallet liquidity raises $7 million in seed funding. So consensus, the, you know, try true and tried Ethereum project that has spun out with the things like MetaMask and Infira and Codify now spinning out liquidity, which I'm not so sure I'm sold on the name. But a new a new wallet coming into the ecosystem done by consensus.

• 45:12Speaker 01

  Yeah, the name trips me up because I always just go straight to liquidity instead of saying liquidity. And

• 45:16David Hoffman?

  And I just started figuring out liquidity. I was about to say liquid.

• 45:22Speaker 01

  Man, these names. But no, no, I think this is really positive because we need more competition in the wallet space. And the fact is that the world space is actually, you know, the front door for for the ecosystem. So if you own that front door and you have the users there, there's a lot of money to be made. I mean, we've seen MetaMask absolutely printing money off of their swap feature, which is literally like, it's not even in your face or anything like that. And they're taking like a 0.8% fee off of that. And I think they're printing like half a million dollars a day or something, something crazy like. And that's like pure revenue and profit, right? Because MetaMask doesn't really take much to maintain. There's a small team that builds out the updates and things like that. So yeah, the wallet space is definitely going to heat up and there's going to be a lot of competition coming to market here.

• 46:04David Hoffman?

  Just kidding, one more raise in the race section. Crypto tax software firm Taxbit has raised $130 million in a series B that sticks their valuation at $1.33 billion.

• 46:18David Hoffman?

  Everyone in crypto hates to do taxes. I'm pretty sure I can speak for everyone when we all say we hate to do taxes. And so the fact that a tax reporting company can raise such a large amount makes a ton of sense because we just want other people to do it for us. Or at least that's just me.

• 46:32Speaker 01

  All right. Yeah, I agree.

• 46:33David Hoffman?

  Yeah.

• 46:35David Hoffman?

  And of course, finishing up the releases section, if you are looking for a job in crypto, there are jobs out there to go and find. So if you are perhaps a senior product manager, Immutable X is looking for you. A full stack software engineer, Palette of this job board is looking for you. We also have jobs from Nervous Network, Impact Theory, The Graph and Argent. If you are looking for a job, go to palette.xyz/list/banklist or just go to the show notes and check out the jobs. Because they are hiring, everyone is hiring these days, including Arbitrum. And so if you want to go get a job with Arbitrum, they are hiring as well. All right, moving on into news, let me close out some of these tabs.

• 47:16David Hoffman?

  The big news of the week was this Poly Network hack, which had over $600 million exploited out of its contracts. Poly Network was a cross-chain asset transfer network, kind of like Thor Chain, kind of like a few others. Interestingly, none of the people that I had, I talked to in my circles like knew Poly Network, even though it had the largest hack in DeFi history, which is kind of interesting. So some funds were lost from Polygon, some funds were lost from the Ethereum main chain. Some funds were lost from Binance Chain. But interestingly, this hacker wasn't very sophisticated. And because he or she or they realized that they had led some breadcrumbs back to a centralized exchange,

• 48:00David Hoffman?

  or they had done KYC presumably, they were forced into having to give all of the assets back. And so the assets were exploited, the hacker had an oh crap moment and returned all of the money. And there's also a story in here about the nature of decentralized, you know, permissionless assets versus more permissioned assets. USDT actually froze these hackers' funds. And as we all know, USDT is a centralized company, they can freeze your money. And so if you hack USDT, you actually don't have the money in the bank. And so there's a bunch of just funny little stories that happened with the biggest hack in DeFi history. Anthony, any thoughts on this?

• 48:41Speaker 01

  Yeah, I mean, it's funny because I had never heard of this either. And a lot of people were getting this confused with Polygon, which is funny. But I think this shows like a deep divide between the East and the West. I think this was a project in China or somewhere in Asia. And there's like a deep divide between the East and Western communities, both kind of language barrier wise and cultural wise. And a lot of people weren't using this in that in that kind of community. And no one I knew was kind of using this. But yeah, I mean, 611 million stolen, like, it's an absolutely massive amount of of kind of like money. But them giving it back because they were sloppy is just, I mean, this just points to pure amateur hour, where some script kitty probably got on a high and said, wow, if this actually works, I'm gonna steal this money. And then they were like, oh, wow, like, I didn't think

• 49:26Speaker 01

  this through. I've leaked, you know, personal information everywhere, like, oh, crap. And then USDT freezing the funds. I mean, this shouldn't come as a surprise to anyone. USDT and USDC both have functions in their smart contract to freeze these funds. So you should never be surprised by this when this happens. But yeah, just, I mean, good to see that money was returned and people are gonna get their money back, I assume. But at the same time, just speaks to the nature of this cross chain stuff and how, I guess, like, immature it is right now. It is very immature. There's a lot of moving parts to it. There's a lot of things that can go wrong. And, you know, you need to be careful when using these tools.

• 50:00David Hoffman?

  Maybe we will borrow some time from the takes section. But one of the takes that I had this week was that the phrase cross chain transfer is going to move away from a, you know, L1 to L1, a Bitcoin to Ethereum, or to Polygon, or whatever. And it's instead going to be start to start to be used as an Ethereum L2 to L2 transfer. This is what we are seeing with things like Connect and Hot Protocol. When people start to talk about cross chain, they're going to increasingly talk about Ethereum L2 transfers to other layer twos. And when you go from EVM chain to EVM chain, things are easier, especially when they are actually true rollups on Ethereum. There's a lot less less complexity. There's a lot less risk. We saw Thor chain, the other, the L1 cross chain transfer protocol,

• 50:45David Hoffman?

  that got exploited multiple times in the last month. It's just very, very complicated. And there's this growing ecosystem of Ethereum L2s. And I'm pretty sure, Anthony, you believe me, or you're you agree with me, when we kind of think that all this activity is kind of getting get sticky to these L2s, and the world of cross chain is just going to mean cross L2.

• 51:03Speaker 01

  Yeah, I believe so. You know, I mean, as I was saying before, like about the multi-chain kind of world and how I think that other things can can exist and find their niches and stuff. I still believe that to be a reality, but I do think that a lot of stuff is just going to accrue to L2 because it makes too much sense, right? You have the security and decentralization of L1 and then you have inherit that at L2 and then with the cross-chain stuff. I mean, I think inherently the cross-chain stuff is always going to be more risky than than anything because of the fact that it has to touch multiple points. There's always going to be like a point where there has to be a maybe a trade-off between decentralization and centralization and some security trade-offs, but I'm excited to see like all of them play out and all of them to kind of like innovate here and maybe we can get to a fully trustless cross-chain system eventually.

• 51:48Speaker 01

  That would be like the holy grail.

• 51:49David Hoffman?

  Absolutely. Something that came across my feed earlier this week is AVE is exploring building on other other chains, including Solana and Avalanche and of course other Layer 2s. This is a new direction coming out of AVE. It's not something that's foreign to the world of DeFi and Ethereum. We've seen plenty of teams build on, you know, any any chain that they can get their hands on, but it seems AVE is moving out on to other L1s. Anthony, any thoughts here?

• 52:17Speaker 01

  I'm not surprised. I think that it's more of a defensive measure than anything else where if they don't move AVE to there, someone will fork AVE and build it on these chains, right? And then they'll lose the market share. The way I view these kind of things is that Ethereum is the headquarters, right? It's HQ. It's where everything, you know, major happens like governance and things like that. But then you want to have branches in other countries, right? So you basically have like an AVE branch on Solana, maybe an AVE branch on on Avalanche, an AVE branch on all the Layer 2s, but all that value accrues to the AVE token that sits on Ethereum and to the treasury that would sit on Ethereum because that's the most secure place to be and that is the headquarters. So we're going to see this in pretty much like all apps eventually, but just because they're deployed to one of these chains doesn't mean they're going to see

• 52:59Speaker 01

  the usage, right? Deploying is easy. Getting users is what's difficult. So it's going to be interesting to see what users prefer. I'm betting on users preferring Layer 2 and Deb's preferring Layer 2 as well because they know that it's a it's a more secure system to build upon, but we're going to have to see how this shakes out. Like it's it's still very early, right? We don't know how this is going to shake out. I obviously, and I mean you as well, are betting on Ethereum being the the thing at the middle. And I think Ethereum has already won that, but you know, it's going to be interesting to see which other chains kind of like get traction.

• 53:30David Hoffman?

  Coming to a close on DeFi news stuff, Uniswap just became the first protocol to surpass a billion dollars in fees. Wow. A billion dollars in not trading volume in fees. Fees collected and paid out to liquidity providers. That is pretty cool. Lucas, who tweeted out this tweet, and of course, I agree with this as well. Congratulations to Hayden and the whole Uniswap team.

• 53:53Speaker 01

  Yeah, yeah. I mean, just looking at the head math, yeah, if the 0.05% fee rake was turned on for like the treasury, or that's for the token holders, instead of it all going to LPs, this would have been like a lot of money, hundreds of millions going to them. So, yeah, I mean, it's still cool to see like, that's a crap ton of money going to liquidity providers.

• 54:16David Hoffman?

  And then last thing in the markets or the news section is Gemini makes an acquisition of Guessr, a new prediction market platform. And so we've seen the Gemini twins, the Winklevi, acquire other things before. They acquired a NFT gateway from Fun Fact, another set of identical twins. And then I asked them if they was if Guessr was founded by another set of twins, but they didn't, they didn't like that joke, or they didn't respond, one of the two. All right, guys, moving on into the world of NFT news. Penguins are on the front page of the New York Times, which is absolutely crazy. I guess disclaimer, I have a Penguin. I have a couple Penguins. But the title of this, I thought was pretty interesting.

• 54:57David Hoffman?

  And the title of this piece was called, I joined a Penguin NFT club because apparently that's what we do now with the subtitle. Is that what the metaverse, is this what the metaverse looks like? And thankless listeners, if you have listened to the episode with Luke Burgess, The Power of Memetic Desire, the line, that's what apparently that's what we do now stood out to me because it's so clearly shows the power of just like, oh, other people are doing this? I guess I'm doing this. Like, oh, other people are putting Penguins as their profile picture? I'm doing this as well. This apparently, this is what we do now. And so this is kind of turned into what the story of Ethereum has been over the last two weeks or so is like this NFT profile picture avatar like games, like started with

• 55:41David Hoffman?

  CryptoPunks, then moved on to Bored Apes. These Penguins have absolutely exploded on the scene. And now Penguins are on the front page of the New York, or not the front page, but on the New York Times, which I think is pretty crazy.

• 55:53Speaker 01

  Yeah, yeah. I mean, this has been funny to watch play out. I I'm copying shit because I don't own a Penguin. And and and even though a lot of these Penguins look like me because they have a a hat that's similar to my hat. And some of them have like a beard and things like that. And I I guess like I'm just a no Pengu uh right now. They're calling like Pengus or Pengus or whatever. Um. But I mean, yeah, it's it's been wild. And, you know, I think this profile picture trend stems from the fact that a lot of people have been priced out of punks, right? Like punks, the floor is like hundred and fifty thousand dollars or whatever it is. And people want to be part of a community. So there's a lot of these projects spinning up. You know, a lot of them are opportunistic money grabs or some of them are scams. But there are certain ones that pop up and people just resonate with them, like the Penguins are cute, right? They're cute and wholesome. A lot of people kind of like resonated with it, changed their profile picture to it.

• 56:37Speaker 01

  And that's how these things kind of like come to life. And if you join the Discord channel, you'll see like the absolute madness that goes on in there. It's just meme heaven. Like, there's so much like stuff going on in there. It's hilarious. But essentially, uh and then, you know, the price of admission right now, I think the floor for the Penguins is like 1.8 ETH. So it's not cheap anymore. Um. So as the price of admission goes up, I think people that get priced out just go down that kind of like, I guess, um, that pyramid. And eventually you get to the base where like, you know, there's a project where everyone can enjoy. But then, you know, eventually it keeps going up. Like, at the top of the pyramid, you have punks. And then you have like Board Eight Yop Club, and then you have maybe like Penguins. And then as you go down, you you kind of like have, it's like a status thing as well, where it's like, you know, you you own a certain thing. You're part of a certain group. But uh this is, this is fun to see play out.

• 57:20Speaker 01

  Like, I really like how much energy there is in the NFT space. Even though a lot of people are speculating on these things, I think a lot of people just feel like a very deep sense of community whenever they buy something. Like, yes, you can right-click save it, but like, you're not part of the group, right? You're not part of the cool kids if you do that. You're only part of the group if you actually buy a Pengu. And there's only eight, eight, eight, eight Penguins. So, you know, you could be a part of an exclusive club, but only eight thousand eight hundred eighty-eight people can ever be a part of. And even though the price of admission is is quite high right now, it's probably worth it for a lot of people because they're like, well, I can be part of the cool Penguin Club.

• 57:54David Hoffman?

  No, that's exactly right. Uh, I'm part of the cool Penguin Cub, the club, and I feel very, very cool. The other two things, two fascinating things I think that are about this is like this, these whole NFT avatar games. They are literally games of just like. Do we like the way these things look? And like, so like the fundamentals on these penguins are like, they're really cute. They're really cute little drawings. That's like the fundamentals behind this project. And then, of course, we also have the subtitle, is this what the metaverse looks like? Metaverse becoming a household name. We see the Facebook pushing the phrase, the metaverse. The metaverse is a very frequent topic in the world of crypto. We have the Bankless subnewsletter coming out as the metaverse, ran by the fabulous William Peaster.

• 58:37David Hoffman?

  Metaverse, common household name, more and more and more these days. Moving on real quick here, something interesting in the world of crypto is going on that FTX, the, the big exchange out of San Bankman Freed that likes to slap its name across everything, is sponsoring 137 Axie Infinity players from developing countries. Which means that they are giving them the axes to go play the Axie game, which is where they get the revenue from. And FTX is sponsoring 137 of them. So that is pretty cool. Also, in the world of NFTs, DraftKings launches an NFT marketplace, which with, uh, Tom, uh, excuse me, Tom Brady as the first drop. I tried to do a little bit of snooping and figure out what blockchain that they had been deployed on.

• 59:22David Hoffman?

  They have kept it a secret. There's murmurings of it being on Polygon, but that could just be-

• 59:26Speaker 01

  It is Polygon. I snooped around, yeah. Yeah, it is Polygon.

• 59:30David Hoffman?

  You snooped around better than I did. All right, wow, wow, that's actually, that's fantastic for Polygon. Congratulations to Polygon and also congratulations for drafting to getting into the world of NFTs. Although not all NFTs are created equal. So we'll see how the more and more details behind this. Anthony, do you have any thoughts on this announcement?

• 59:47Speaker 01

  I mean, I think it's pretty cool. And I think Polygon itself is definitely positioning, positioning themselves as a really nice NFT platform that obviously the POS chain is in a true layer two, but like, you know, Ethereum friendly and things like that. So it's just great to keep this kind of like in the Ethereum ecosystem and great to see. I guess like, I didn't know what DraftKings was because I think it's very big in the US. It's not big here in Australia and I'm not into sports. So I actually had to Google who Tom Brady was the other day. That's how not into sports I am. But essentially, I mean, it's good to see that, like, the thesis playing out for NFTs, where basically the thesis is that NFT has like a total adjustable market of like the entire world and all these different industries and they're coming, they're coming in waves. And as I was saying before, there's going to be a lot more over the next six to 12 months.

• 1:00:30David Hoffman?

  Coming in at Bitcoin news, five North American mining firms reported that they earned 58% more Bitcoin in July, thanks to China, thanks to the big hashing migration out of China, the drop in hash rate, which makes Bitcoin miners everywhere across the world more profitable. So a little bit of positive news if you're into the belief that this is good for American regulation of Bitcoin and American Bitcoin infrastructure at large. Bitcoin miners making a little bit more money, bringing some more Bitcoins on to American soil and away from China soil, which again, I always think is bullish, at least from a regulatory standpoint, makes people more friendly with Bitcoin.

• 1:01:10Speaker 01

  Yeah, I mean, yeah, I mean, this is, this is obvious to see, like, I was, as China shut down, their, their kind of miners and hash rate, the ones located in other kind of like jurisdictions are going to get more, more profit from, from mining Bitcoin. So yeah, makes sense to me.

• 1:01:25David Hoffman?

  Moving into regulation, which was a massive topic this week, this, this subject matter really kind of finished out on Monday and Tuesday of this week. We kind of had it, we were watching it live as I was writing up the Market Monday post on Bankless, if you also want to keep, get yourself updated with what's going on in the world of regulation. But as we all know, we have this massive tax bill in America that was getting held up by the crypto industry, by cryptocurrency. The crypto industry was one of the, the reason as to why this massive, massive infrastructure bill got held up in Congress, in the Senate. The title on the CNBC article says lawmakers fought over crypto's place in the infrastructure bill. Here's what's next for the industry. And then, if you were paying attention, we

• 1:02:09David Hoffman?

  watched this Republican Senator from Alabama block the amendment because he didn't get the money that he wanted for defense spending. He wanted something like $50 billion for defense spending, so he blocked the crypto amendment because he didn't get his amendment in, which frustrated basically everyone in the industry. And so where we stand now... Is that the Senate has voted 69 to 30 to pass the infrastructure bill with the original crypto provisions, right? So this is where everyone becomes a broker. This was more or less actually the worst case scenario. This is what no one wanted, but like the thing is it's such a bad scenario that no one is taking it seriously. It's it's like it's like

• 1:02:52David Hoffman?

  it went all the way around the world, right? Like it is so bad that it's so backwards that it's actually like good for some reason. And and that's kind of my my take on that. And and the finishing up the conversation, we were as an industry trying to figure out who is going after crypto, who is really trying to come after crypto and impose all these burdensome regulations on it. Turns out it's the White House and Janet Yellen, who was a previous Fed Chair, and I think that is particularly interesting. Janet Yellen, the Treasury Chair Secretary to the Biden administration, is apparently the one that has been lobbying the Senate and lobbying Congress to get this really, really burdensome regulation on our industry, especially DeFi.

• 1:03:35David Hoffman?

  And and then Anthony, I'm going to give you the floor. The thing that I thought was particularly interesting is during this whole like week of drama and so many different amendments getting proposed, we had this amendment get proposed that specifically protected the proof of work industry and the mining industry. And they and so the Bitcoin community was overjoyed because not only were they protected, but everyone else was not protected. And my take on this, and I want to get your take on it on on my take, Anthony, is that the fact that the the regulators were okay with Bitcoin mining and Bitcoin getting carved out, but not DeFi, not Ethereum, tells you exactly where their priorities are and tells you exactly

• 1:04:16David Hoffman?

  where they think the threat is. Bitcoin getting carved out was not bullish for Bitcoin. It's because they don't feel like it was a threat. So that is that is what happened in the in the last week of regulation and also my take on it. Anthony, any thoughts or anything I missed?

• 1:04:32Speaker 01

  No, no, you summarized it really well. I think if we're just like cutting out all the bullshit, this is an attack on DeFi, uh, straight up. Like the treasury being involved tells me that as, you know, more than anything, uh, it's unfortunate to see what happened here, but I agree with you that this, um, uh, kind of like legislation was so bad and, and so shitty and so unenforceable that the market was just like, we don't give a shit about this. This is a joke. Like this is not going to lead to anything. And we can still, you know, the, but we can still fight this in the House in the US and then in the courts if it gets to that, because this doesn't go into law until 2023. So I think just generally people are like both optimistic that we're going to be able to, to get this crap out of there, but also at the same time being like, well, you know, this is what we're fighting up against. This is the war that we have to have. We shot first at

• 1:05:16Speaker 01

  the end of the day. Like we, we definitely, um, you know, kicked the hornet's nest, but now crypto is, you know, crypto was the, the sole thing holding up this massive infrastructure bill for the US. Like crypto is, is kind of like in the big leagues now. We have, we have made ourselves known. We have said very, very loudly, we are here and we are not to be, not to be screwed with because, um, a lot of these senators would have learned about crypto this week. A lot of them would have learned how many of their constituents, uh, how many people, uh, as part of like their, their jurisdictions actually care about this. And this could be like a single issue, uh, voter type thing for a lot of them. So they're going to start, I think, um, you know, learning more about it, seeing who cares about it, seeing what they can do to help it. And, you know, we have, we do have some people in, in the Senate that actually are on our side. Um, you know, people will be cynical and say, well, they're not on our side. They're on their side. It's like,

• 1:06:01Speaker 01

  it doesn't matter. If they're on their side and aligns with our side, then they're on our side. That's how I view it. Uh, so yeah, I mean, I, I, I just think that really this was a, a nothing burger, uh, for now, but I do think if this does go into law, it's going to be very, um, bad for the US long-term because a lot of companies will leave the US because they'll be like, well, I can't operate here anymore. The crypto is going to change the world. So I'm moving to this other country. Goodbye, all the economic benefit. Goodbye, all the taxes that you get from these companies in the US. And, and you basically just push away a massive, massive industry.

• 1:06:32David Hoffman?

  Yeah, that is the takeaway that I've heard so many people give is it was a massive surprise as how energetic crypto came to defend itself and it showed up in force. It showed up with phone calls, emails and tweets. Apparently tweeting at your senator is a really powerful thing to do because when you call your senator's office, you're not getting to the senator. But when you at your senator, that's they're going to their phone. That's going to their Twitter messages. And so they know what's up with that. One last take on this came from Jake Shavinsky, who we are actually having on the Bankless State of the Nation next Tuesday. And so we are going to ask him all of these questions and more. But DC investor, of course, friend of the pod, says, fun fact, I have a masters in public policy and spent years

• 1:07:14David Hoffman?

  working around the government. I know how the sausage is made. All of this probably jammed in by random staffers who were probably heavily lobbied by various industries. It is what it is. All we can do is express our opinions with money and words. But then Jake Shavinsky, who's very, very close to this whole thing, says, this isn't what I hear. Word is, is that it came from Treasury. They don't like what we're building. And they're using the infrastructure bill as strategic cover to get a jurisdiction over non custodial market actors, which they wanted to, but failed to get with a previous FinCEN proposal, the whole minutia regulatory flood during the transition. So it's interesting to see

• 1:07:53David Hoffman?

  this like surgical targeted attack on DeFi, just like what you said. And it's also interesting to see the absolute strength of the crypto community come and put their foot down and say, no. But the story is going to continue to be on to, it's going to continue to unfold. All right. Also, in the world of regulation, Brian Brooks steps down from Binance US as the role of CEO. Brian Brooks, also a former regulator from the CFTC, steps down as CEO from Binance US, which raised a lot of eyebrows because he had only been there for a few months. And as we all know, on the Bankless program, we've been calling it the Bankless, or excuse me, the Binance squeeze. Binance is getting squeezed more and more and more by regulators.

• 1:08:36David Hoffman?

  And now a their CEO has stepped down after just a few months. And so the Binance squeeze tightens. Anthony, any thoughts here?

• 1:08:45Speaker 01

  I think Brian says the writing on the wall that Binance is going to continue to suffer this squeeze, as you call it. They, I mean, they have been suffering from it. I think centralized exchanges in general are going to keep getting squeezed, especially those that don't follow the regulations that are in place. And I mean, you've already seen this play out like with Binance lowering leverage requirement, leverage, max leverage to 20x, banning leverage in certain countries, pulling out of other countries. And yeah, this is just going to continue. And I think Brian really did see the writing on the wall. And you can see he's had a colored history within crypto, you know, former CEO of Binance US, former chief legal officer at Coinbase as well. But he was also working in government as the, as the acting controller of the currency, as which is, which is a pretty, pretty big position too. So yeah, I think he's just getting out while he can.

• 1:09:30Speaker 01

  He doesn't, probably doesn't want to be involved in the regulatory kind of like mess that's coming towards what's, what's Binance and continuing to come towards it.

• 1:09:37David Hoffman?

  Last thing in the regulatory section, Circle becomes, intends to become a full reserve national commercial bank. So a big upgrade from Circle to become a, a national bank. Interestingly, as we all know, the banks in the US operate on a fractional reserve basis, a 10 to one basis. But that is not Circle's product. So Circle wants to become a fully collateralized one to one bank. And there are probably some more details need to come out there as to what this really means. Can I just make an account with Circle? Can I finally break up with Wells Fargo and just join Circle? I mean, I'll trade bank to bank, but I think I like that one a little bit more. Anthony, any thoughts here?

• 1:10:15Speaker 01

  Yeah, if I have to use a bank, I would rather use one that at least had crypto features embedded into it and was like crypto native and friendly. So I mean, obviously Circle is not going to be coming to Australia anytime soon. But you know, I think that if you have to use a bank, I would go with this. But obviously like we all want to be as bankless as possible, but we can't be for certain activities. Like I, unfortunately I have to use a bank account for certain things. We all do.

• 1:10:38David Hoffman?

  Like bank figurines, right?

• 1:10:41Speaker 01

  Yeah, like buying figurines. But yeah, no, I think this is this is quite positive to see. I think this is going to bring in a lot more people into crypto as well, because at the end of the day, a lot of people don't want to manage their own funds, and that's fine. They can, you know, use a third party, but this third party is still going to be using our beautiful DeFi rails, which I think is is is great.

• 1:11:00David Hoffman?

  And then, of course, last thing in news, just I feel like it's worth a mention, but it is the one year anniversary week of yams. I think we all remember where we were when yams happened. As we all know, comp kicked off liquidity mining and yield farming, but it was yams that kicked off the whole food coin mania and to really tell people that you could actually compose some brand new community using other communities and a bunch of yield farming, and really just left a very significant mark on DeFi to this day. Anthony, any thoughts on the one year anniversary of yams?

• 1:11:35Speaker 01

  Yeah, I mean, I remember the day Yan went live. I woke up after it had gone live. I came to my computer. I was like, what the hell is happening? Like, I went on Twitter. I'm like, oh, my God. The next 16 hours of that day felt like less than 10 minutes. I didn't really do anything. It was absolute. And no, dude, it was absolute insanity. It felt like I was playing World of Warcraft again back in like my teenage years, where I just didn't move the whole day, did nothing else except sit in front of my computer. But yeah, like, it was crazy. And as you say, that kicked off the food fork mania, kicked off everything and just absolute mayhem. And I think it's a special kind of like moment that a lot of us will hold in our hearts. And a little bit of Robert Leshner there with the with the yam. That's funny.

• 1:12:18David Hoffman?

  That is funny. I did not see this earlier. But yeah, like, just like you said, here's Robert Leshner apparently farming some yams. All right, guys, make sure you don't go anywhere because we are going into the ecosystem takes afterwards. And of course, finishing off with the meme of the week. But first, a moment to talk about some of these fantastic sponsors that make the show possible. Gemini is the world's most trusted cryptocurrency exchange. I've been a customer of Gemini since I first got into crypto in 2017, and it's been my main exchange of choice to make my crypto buys and sells. Gemini is available in all 50 states and in over 50 countries worldwide and on Gemini there are markets for over 30 various different crypto assets, including many of the hot DeFi tokens and it's one of the few exchanges that has liquid die markets.

• 1:13:01David Hoffman?

  Gemini just launched their Earn program where you can earn up to 7.4% interest on 26 various crypto assets. If you're tired of paying fees in DeFi or you don't want to worry about DeFi exploits, but you still want to earn interest on your crypto assets, Gemini Earn is the product for you. Another product I'm stoked to get my hands on is the Gemini Crypto Back Credit Card, which gives you 3% cash back on all of your purchases, but paid to you in your preferred crypto asset. When I get my Gemini credit card, I'm going to make sure that I get my cash back in ETH. So whenever I buy something, I get a little bit of ETH bonus back to me at the same time. You can open up a free account in under three minutes at Gemini.com/goBanklist. And if you trade more than $100 within the first 30 days after signup,

• 1:13:46David Hoffman?

  you'll be gifted a free $15 Bitcoin bonus. Check them out at Gemini.com/goBanklist. The AVE protocol is a decentralized liquidity protocol on Ethereum, which allows users to supply and borrow certain crypto assets. AVE version 2 has a ton of cool features that makes using the AVE protocol even more powerful. With AVE, you can leverage the full power of DeFi Money Legos, yield and composability all in one application. On AVE, there are a ton of assets that you can supply to the protocol in order to gain yield. And all of those same assets can also be borrowed from the protocol if you have supplied collateral.

• 1:14:25David Hoffman?

  Here you can see me borrowing 200 USDC against my portfolio of a number of different DeFi tokens in ETH. I'll choose a variable interest rate because it's a lower rate than the stable interest rate option. But I could choose the stable interest rate option if I wanted to lock in that interest rate in permanently. V2 also features the ability for users to swap collateral without having to withdraw their assets, trade them on Uniswap and then deposit them back into Aave. With Aave, users can do this in one seamless transaction, saving you time and gas costs. Check out the power of Aave at ave.com. That's A-A-V-E dot com. All right, Anthony, I got some takes for us to talk about. And of course, the first one starts off with your good friend Eric Connor, who says, "We all need to realize

• 1:15:08David Hoffman?

  that this is going to be commonplace for crypto and DeFi over the next 20 years when it comes to regulation. It's the hot new thing to be regulated like banks in 2009. We need to coordinate properly, but not overreact every single time. It's not the end of crypto." And I think Eric is really just saying, hey, like, we're here, we've arrived, we've arrived into the era of crypto regulation. This first bill is an absolute mess, but it's the first one. So that makes sense that it's kind of a mess and get used to it because we're going to see more crypto regulation moving forward into the future.

• 1:15:40Speaker 01

  Yeah, I mean, I totally agree with Eric. This is literally just the first thing we're seeing of this. And we definitely should all be prepared and expect this because, as I said, we shot first, we are poised, this whole industry is poised to interrupt very, very deeply embedded institutions in the world. And they're not just going to sit by and take it. They're going to fight back. Some of them will join us, some of them will be our enemy, and we'll just have to fight.

• 1:16:02David Hoffman?

  Absolutely. A take from Suzu, who writes a tweet as to why he bought punks and other NFTs. He says, "We bought punks and NFTs because they are undeniably a part of the broader story of digital scarcity, meme economy, collective capitalism, metaverse, and mind-body dissociation." Anthony, I'm going to let you give your take on this take first.

• 1:16:25Speaker 01

  Yeah, no, no, I totally agree with him here. If you really think about it, like, how, how much time do we all spend in front of our screens as part of like this metaverse, digital kind of like world? We spend most of our days in that. So, you know, why not kind of, I guess, like embrace that? And then by, and the way you embrace that is by being part of like the NFT ecosystem, being part of the metaverse, you know, instead of buying physical kind of like products, you buy digital ones. Or if you're like me, you do both, you know, buy figurines and buy, you know, digital NFTs and stuff like that. But he's right. I mean, yeah, Suzu's definitely on the money here. With what he's saying about digital scarcity and the meme economy, like if you just see what's been happening over the last kind of like, you know, decade or so with the rise of social media on the internet,

• 1:17:07Speaker 01

  it really is all about memes and, and, and a kind of like, uh, the metaverse and mind body dissociation. But what crypto brings to it is that digital scarcity, that collective capitalism and, and things like the metaverse, which supercharges everything that we've been building up to, uh, you know, over the last decade or so.

• 1:17:24David Hoffman?

  The only thing I have to add is it's totally on brand for Suzu to finish up this whole justification of to why he bought NFTs with mind body dissociation, which is like very on brand for it's like a little bit Chad, a little bit crazy and definitely going to like trigger people's FOMO and imaginations. But also it's mainly just crazy.

• 1:17:44Speaker 01

  Uh huh. Yep. Yep.

• 1:17:47David Hoffman?

  All right. This one, this next one comes from me and I think it's pretty simple. And I just go ahead and say that imagine thinking that trading JPGs isn't product market fit. Like it's such a simple activity. I have this picture. You have that picture. Hey, do you want to trade them? Like you don't have to think about it much more than that. We all traded Pokemon cards when we were young. Like we did it. We didn't question it then. Somebody could print off and, and print, you know, make their own picture, make their own Pokemon card, but it wasn't the same. And so I think trading pictures is going to be just a thing that society does now.

• 1:18:20Speaker 01

  I mean, we've been trading pictures for hundreds of years, right? Like whenever you show a picture to someone or give a picture to someone like, I mean, technically, you know, you're not really trading it, but you're like trading the idea behind it. You're showing off like kind of, um, you know, your picture to people. And we do this online all the time. Everyone shares memes with each other. It's like, hey, look at this meme. Hey, look at my meme. Now we're just kind of like stepping it up and, and kind of like bringing, bringing money into the mix where we're like, hey, I own this meme. Hey, I own this collectible and I can prove it to you that I own it. And you know, digital kind of like collectibles isn't something new. It's been part of, I guess, like video games for a long time. But what's new is the openness, the metaverse nature of it, the kind of like collective capitalism, as Sue calls it. So, uh, yeah, I mean, there is so much product market fit there. It is even funnier.

• 1:19:05David Hoffman?

  Another one from Eric Connor, which I think puts things very, very well into perspective. Fun fact, we didn't cover in markets this week, but gold took a 10% dip this week, which is a very large dip for gold. No one really expects that level of volatility to come out of gold. And so Eric Connor retweets this news and says, "No, you can't buy JPGs." And then, you know, in quotes, proceeds to trade rocks. It's a very sobering reminder that gold is just a goddamn rock. It's just a rock. And so like, people thinking that it's weird to trade JPGs on the internet? Like, we still have people trading rocks and it's one of the most financialized instruments in the world.

• 1:19:43Speaker 01

  Yeah, no, I think so. And I think, I don't know, I'm super bearish on gold. I think over time, we're just going to see more and more gold of gold's value transfer into digital assets. And I think that, yeah, people complaining that you can't trade, you know, JPGs, but are trading rocks. Well, yeah, I mean, that's just like, the irony there is delicious.

• 1:20:02David Hoffman?

  And then the last take that we have comes from Andrew Yang, who says cryptocurrency is one path to universal basic income. As Bankless listeners will know, I'm a big fan of Andrew Yang. I've been trying to get him on the podcast. And he thinks that there's alignment between cryptocurrency and UBI. Fun fact, he actually tweeted this out after, a couple of days after I had a listener of the show, send him a little note to Andrew Yang, saying, "Hey Andrew Yang, please come on the podcast. I believe that your movement that you're trying to inspire has actually done better on crypto rails." Maybe that was a coincidence, or maybe he read that letter? I don't know, but Andrew Yang, come on the podcast.

• 1:20:41Speaker 01

  Yeah, I mean, UBI has been something that's been talked about within crypto for a long time now. There are a few projects out there trying to, trying to do this. And I mean, I think he's right that it's one path to universal basic income. But if we build it on crypto rails, we can get it into the hands of people like much faster than anything else. So, I mean, I hope that he comes on Bankless. I'd love to listen to him on Bankless. Like, yes, you know, not everyone will agree with a lot of his policies or stuff like that. But I think just listening to what he has to say, he's a very smart guy, you know, would be worthwhile. So yeah, Andrew, I mean, I don't know if you're watching the roll up, but if you are, go on the Bankless podcast.

• 1:21:15David Hoffman?

  Andrew's brand is not left, not right, but forward. And that is the brand that I can get behind. And he can talk plenty about non-political things, which means the content can be non-political. All right, Anthony, before we get to the meme of the week, which there are actually two of. So stay tuned for that. Usually this is where I ask Ryan what he's excited about, but you're here instead. So Anthony, what are you excited about?

• 1:21:38Speaker 01

  So I might give like a bit of a boring answer, but I am like very, very excited about what's happening in the NFT space outside of the profile picture mania. There is a lot of innovation going on. There are a lot of people doing a lot of interesting things. Something that I saw come out the other day was paperclip DAO, where it's this kind of like DAO with the initiative to essentially trade their way up from like a very, you know, kind of like valueless kind of NFT to something worth like a lot, maybe a crypto punk or something like that. And this is basically based on the story. And I don't know if this story is true, but it's a story that a guy was able to trade a paperclip, you know, for various items all the way up to a house. So he started with a paperclip, traded his way up to a house. And that's what paperclip DAO is trying to do. So there's with kind of like NFT. So there's a lot of innovation happening in this space outside

• 1:22:22Speaker 01

  of the profile picture mania. And that's what I'm most excited about seeing is like people using NFTs for more than just like trading, like, you know, I think trading JPGs is a big use case, but if you're just doing that, and that's all, I think you're limiting the potential of that technology.

• 1:22:36David Hoffman?

  Absolutely. This is where you ask me what I'm excited about.

• 1:22:40Speaker 01

  Okay. What are you excited about, David?

• 1:22:43David Hoffman?

  Well, I'm excited about specifically the NFT avatar movement, the thing that you were talking about. You weren't excited about. No, maybe I'm putting on the bull market goggles, but like the NFT avatar movement is such a simple thing to understand. And like also to some degree, people are going to like, oh, cool, cute penguins. I'll put that as an as my avatar too. Oh, wait, like it costs $6,000. They're gonna, they're gonna run into that, that whole like, but I can still put it as my profile. But, but at some point in time, some NFT avatar thing is coming for you in the sense that like, maybe crypto punks weren't your thing. Maybe penguins weren't your thing. Maybe bored apes weren't your thing, but there's going to be something.

• 1:23:24David Hoffman?

  Going to be something that is relevant to you. And when I the when I FOMOed into my CryptoPunk, it happened right after People Pleaser had her digital artwork featured in Fortune. And she had all these cameos, all these like Easter eggs to all these like crypto native people like, and it was, you know, Santiago Santos, but it wasn't his picture. It was his CryptoPunk, right? It wasn't Tetronode. It wasn't his picture because we don't know what Tetronode looks like. It was his like digital representation. And so if you want a place in the metaverse, if you want a digital representation, you need a picture that is you, that isn't you. And I think that as the metaverse grows, this whole NFT avatar movement is also going to grow and grow and grow.

• 1:24:09David Hoffman?

  And that was what gets me really, really excited. Also, penguins are cute.

• 1:24:13Speaker 01

  Yeah, I mean, I agree with you, even though I said that I'd like seeing more innovation. I'm not not to say that I'm not excited about this kind of like avatar or profile picture movement. I think that it's definitely, there's definitely a lot of value there and it gives people a sense of community as well.

• 1:24:26David Hoffman?

  All right, Anthony, are you ready to get into the meme of the week?

• 1:24:29Speaker 01

  Uh huh, uh huh. I think I know which one it is.

• 1:24:31David Hoffman?

  Are you sure? Because I actually have two of them and I'm not sure you know which one I'm about to show first. All right, here comes the first one.

• 1:24:35Speaker 01

  Okay, I don't know the first one.

• 1:24:37David Hoffman?

  This one, this one's made by, I'm pretty sure Michael Wong, but I could be wrong. It's the is this a blank meme for those that are on the podcast? It's the guy looking at the looking at the butterfly and always there's this caption. Is this something that is completely not? And that they quote this for this particular meme is, is this a broker? Is a broker?

• 1:24:59Speaker 01

  Yeah, I mean, under the new that that new law, like pretty much everyone's a broker. So like my dog's a broker.

• 1:25:06Speaker 01

  You know, sorry, sorry, mate. You're heavily regulated now. You're gonna have to go to jail for for brokerage services. Like, ah, it's, yeah, I mean, this meme is pretty funny and encapsulates that well.

• 1:25:16David Hoffman?

  All right. And here is, of course, the meme that I think that you thought was coming and it totally is. Here it is. Anthony, you wanna you wanna talk about this meme?

• 1:25:24Speaker 01

  This is a very, very good meme, David. Like, I have to applaud you on this one, my friend. This meme, like, for those just listening in, is basically the Grim Reaper going door to door and, like, killing who's in the room. You know, first, we start off with the narrative that Ethereum will never work. Well, that's dead now. Obviously Ethereum works. The beacon chain will never launch. Well, dead again. 1559 will never ship. Dead. And then you have two doors that are still remain to be opened. The merge will never happen, and ETH will never flip BTC. Now, you have these in the wrong order, I think.

• 1:25:55David Hoffman?

  Oh, spicy. Wow.

• 1:25:57Speaker 01

  I actually think that the hype from the merge, like, when we actually get a date, will be so grand that we might actually see ETH flip BTC before the merge happens. So it's going to be interesting to see if you have these doors around the wrong way, which I think you might just.

• 1:26:14David Hoffman?

  The thing about that claim, Anthony, is that's a very precise claim. That is going to, like, we're going to figure that out in, like, the next, like, three months or so. You think Ether will flip in Bitcoin in, like, three months, give or take?

• 1:26:26Speaker 01

  Not in three, maybe not in three months, because I still think the merge-

• 1:26:29David Hoffman?

  Well, we'll have to have started the process by then.

• 1:26:32Speaker 01

  I think the process started a year ago. But I think that the merge, I mean, the soft range is Q1 2022. It could go to Q2, I don't know. But I think at least within the next 12 months, like, at most, there will be the merge happening. But the thing is, is that that's a long time. Like, ETH is only, I mean, it's a bit more than 2X away. I think, like, 2.3X away from flipping Bitcoin. And, like, the momentum is there. Like, it's really, really there. If we break that seasonality in Q3, Q4, I mean, I'm pretty much, like, very confident, like, 99% confident that we will see ETH flip BTC before the merge happens, if, you know, a few different things go right.

• 1:27:16Speaker 01

  But the momentum is there. I just, it's undeniable, and I think that the narrative is there. The merge, you know, as we get closer to it, more and more people will learn about the fact that we're about to cut issuance by 90%, do three Bitcoin halverings, 12 years' worth of Bitcoin halverings in one foul swoop, like, literally block to block. One block, we have proof of work. The next block, we have proof of mistake. Then 90% issuance reduction. Bye-bye, you know, all the kind of, like, issuance and hello, deflationary Ethereum. It's just too much. Maybe I'm too in the weeds here, but like I'm going to keep talking about this for a long time. And I hope a lot of people, you know, read my tweets and see just what's coming because I mean, a lot of people, this is maybe a bankless exclusive. I've never said this before, but one of my top missions of being involved with Ethereum

• 1:28:01Speaker 01

  is to help it flip Bitcoin because I don't think Bitcoin deserves to be number one. I believe Ethereum deserves to be number one. So that has been my mission for a very long time. So I'm obviously very bullish on the flipping.

• 1:28:12David Hoffman?

  Well, bankless listeners will probably tune into the fact that Ryan and I definitely lean to the Ethereum side of things, but we do try and keep some sort of balance on the bankless show, but not today, not today at all.

• 1:28:24Speaker 01

  Well, I mean, in me saying that like Bitcoin doesn't deserve to be number one doesn't mean that I don't, you know, get the value of Bitcoin. I just think that Ethereum offers much more value than Bitcoin does. So that's kind of like my view on it.

• 1:28:36David Hoffman?

  No, and, and I've been saying on, on the, on the rollups that, uh, you know, when we ever we talk about the ETH BTC ratio, I say like, oh, the, we are at historically high levels and we have been sustaining these high levels. And if we're not going to dump on the ETH BTC ratio, then maybe we're just going to like hang out here and then go up even more. I don't even know.

• 1:28:56Speaker 01

  We'll, we'll see. I'm, I'm actually very, very cautious about that because the seasonality is very strong. So I don't want to be quoted in six months time when the Bitcoin ratio has gone down, saying that I don't think it's going to go down. But definitely you can quote me on the flipping, like any day. I don't care. Like I, I've been saying that for ages.

• 1:29:12David Hoffman?

  Oh yeah, no, I'm, I'm on the flipping boat 100%. Anthony, thank you so much for helping me go through the news of the week. And Anthony, you do this every single day, every single weekday at least on your YouTube channel, The Daily Gua. You want to give that a quick plug and tell you, tell people what people talk about or what you talk about on the show?

• 1:29:31Speaker 01

  Yeah, yeah, yeah. So yeah, I mean, as you said, I do the, the same thing we've done. I guess like every weekday, just covering the last 24 hours worth of Ethereum and crypto news. So yeah, people can go check that out, The Daily Gua YouTube channel. And I also put out a daily newsletter covering the biggest thing, one, one of the biggest things happening in the Ethereum ecosystem as well. Uh, you can find them both. If you just Google The Daily Gua, you'll be able to find them.

• 1:29:52David Hoffman?

  And we will have those in the show notes as well. That is where I get a lot of my information every single day. It's a trusted source for all of Ethereum, DeFi, all this good stuff and really good analysis from someone who has been in the community for longer than I have. So Anthony, thank you for all the, all you do at The Daily Gua.

• 1:30:11Speaker 01

  Yeah, thanks for the kind words and thanks for having me on the roll up again. Hopefully Ryan will stop slacking, so I won't have to fill in for him anymore. But no, no, no, I enjoy this and Ryan deserves a break. I mean, I, you know, I saw on the Twitter the other day, he actually has a lower body, which surprised me a little bit, but you know.

• 1:30:25David Hoffman?

  I was so surprised. I didn't know who let him out of the house.

• 1:30:30Speaker 01

  Yeah, that's it. That's it.

• 1:30:33David Hoffman?

  Yeah, we're gonna have to add that link to the show notes as well so listeners can know what we are talking about. All right, everyone, thank you for tuning into this Friday edition of the Bankless Weekly Rollup. As we all know, ETH is risky, crypto is risky, DeFi is risky. You can lose what you put in. We are headed west. We're on the frontier. We are, it's not for everyone, but we are glad you are with us on the Bankless journey. Thanks a lot. Hey, we hope you enjoyed the video. If you did, head over to Bankless HQ right now to develop your crypto investing skills and learn how to free yourself from banks and gain your financial independence. We recommend joining our daily newsletter, podcasts and community as a Bankless Premium subscriber to get the most out of your Bankless experience.

• 1:31:17David Hoffman?

  You'll get access to our market analysis, our alpha leaks and exclusive content and even the Bankless token for airdrops, raffles and unlocks. If you're interested in crypto, the Bankless community is where you want to be. Click the link in the description to become a Bankless Premium subscriber today. Also, don't forget to subscribe to the channel for in-depth interviews with industry leaders, Ask Me Anythings and Weekly Rollups where we summarize the week in crypto and other fantastic content. Thanks everyone for watching and being on the journey as we build out the Bankless nation.