16 - What's an Etherean? | Nic Carter

Episode: #16 June 8, 2020 Nic Carter is one of our favorite writers in crypto. He's shaped our thoughts on many subjects over the years. Now we got to sit down and talk the challenging stuff. The stuff typical podcasts never as him...we dive right in. He's a bitcoin yes...is he an Etherean? He's bullish on stablecoins...is he bullish ETH value accrual? He thinks free banking is good...does he think Maker is good? Nic believe in bitcoin values...does he believe in bankless values? This episode is jam packed with insights. Covered: Is Nic an Etherean? What does Etherean even mean? Are stablecoins good or bad for ETH? Why the entire point is blockspace demand How economically dense transactions win Settlement assurances & property rights Why crypto banks aren't all bad Emerging digital nation states Will this bankless thing work? Plus Ryan and David discuss: How David got pepper sprayed last weekend Bankless as an anti-authoritarian movement Building it up not burning it down Join us next Monday for a fresh episode! ----- Tools from our sponsors to go bankless: Multis http://www.multis.co/ - bank your business without a bank (1 mon. trial https://multis.co/!) Ramp https://ramp.network/ - the fiat onramp for DeFi (mention Bankless!) Monolith https://monolith.xyz/ - holy grail of bankless Visa cards Aave https://aave.com/ - money lego for lending & borrowing ----- Resources discussed: (Article) It’s the settlement assurances, stupid https://medium.com/@nic__carter/its-the-settlement-assurances-stupid-5dcd1c3f4e41 - Nic Carter (Article) Visions of Bitcoin https://medium.com/@nic__carter/visions-of-bitcoin-4b7b7cbcd24c - Nic Carter (Article) Crypto-fiat: Mutualistic or Parasitic https://bankless.substack.com/p/crypto-fiat-mutualistic-or-parasitic - Nic Carter (Article) While the cities burn below https://bankless.substack.com/p/while-the-cities-burn-below-market-716 - RSA ----- Episode Actions: Read some Nic Carter articles! (see above) Catch up on previous episodes (#2 http://podcast.banklesshq.com/2-the-evolution-of-monetary-policy, #7 http://podcast.banklesshq.com/7-ethers-value-mechanisms, #12 http://podcast.banklesshq.com/11-settlement-assurances-and-the-protocol-sink) Pump Bankless by giving us a 5-star review on iTunes https://podcasts.apple.com/us/podcast/bankless/id1499409058! ----- Subscribe to podcast on iTunes https://podcasts.apple.com/us/podcast/bankless/id1499409058 | Spotify https://open.spotify.com/show/41TNnXSv5ExcQSzEGLlGhy | YouTube https://www.youtube.com/c/bankless | RSS Feed http://podcast.banklesshq.com/ Leave a review on iTunes https://podcasts.apple.com/us/podcast/bankless/id1499409058 Share the episode with someone you know! ----- Don't stop at the podcast! Subscribe to the Bankless newsletter program http://bankless.substack.com/ Visit official Bankless website http://banklesshq.com/ for resources Follow Bankless on Twitter https://twitter.com/BanklessHQ | YouTube https://www.youtube.com/c/bankless Follow Ryan on Twitter https://twitter.com/ryansadams Follow David on Twitter https://twitter.com/TrustlessState

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

• 0:03Ryan Sean Adams?

  Welcome to Bankless, where we explore the frontier of internet money and internet finance. This is how to get started, how to get better, and how to front run the opportunity. This is Ryan Sean Adams. I am here with David Hoffman, and we're here to help you become more bankless. David, this is an incredible episode. We've been waiting a long time for this. We are talking with Nic Carter today. What did we cover?

• 0:28David Hoffman?

  So much, so much. Nic Carter is always a valuable person to get on any podcast, particularly in the way that Nick clearly thinks and thinks differently from most people in this space that get caught up in the tribalism, caught up in the maxi warfare, something that I would definitely say I do from time to time. So getting Nick's perspective on here and making sure that when we make comparisons, when we make claims, that they are grounded in something that is useful outside of crypto, rather than just comparing crypto system A to crypto system B. Nick's perspective really makes sure that we are anchoring these things in time in relation to the systems that have

• 1:10David Hoffman?

  come before crypto and using the lessons of historical financial mechanisms to compare and contrast mechanisms that we find today in the crypto land.

• 1:19Ryan Sean Adams?

  Yeah, and I think Nick would definitely consider himself a Bitcoiner, but he'd probably put an asterisk by that. And I don't think Nick would consider himself at all a Bitcoin maximalist. He's very open in terms of ideas. One of the first questions we asked him was whether he identified with the Ethereum community and with the DeFi movement. And his answer to that was really interesting. And then we talked some more about stable coins, which has been a topic I've wanted to pick Nick's brain on for a while, whether particularly stable coins on Ethereum, and there's over 8 billion now dollars worth

• 1:59Ryan Sean Adams?

  of stable coins on Ethereum, whether those are good or bad for Ethereum. Getting his take on that was super interesting. And then, of course, we got into settlement assurance. Really, I feel like this episode tied a lot of other episodes together. So if you're just listening to Bankless, you haven't caught up on the archive, go check the archive out. Episode two, we talked about monetary policy and monetary theory that relates to this. Episode seven, we talked about Ether's value mechanism. So we talked about EIP 1559. So that comes in here when we're talking about stablecoins. Episode 12, we talked about the protocol sync thesis.

• 2:41Ryan Sean Adams?

  Nick has some really interesting perspectives on how to apply that lens of things to Ethereum transactions. So overall, this is an episode that puts a lot of the previous episodes together, and they all kind of feed into this conversation with Nic Carter. It was great. He's always good.

• 2:59David Hoffman?

  And then we finish off the conversation with two topics that Bitcoiners and Ethereum's always butt heads about, and that is kind of the juxtaposition between a DeFi world and a crypto banks world. Nick calls this movement free banking. It's like the banking 2.0, but instead of gold, it's Bitcoin. And without all the limitations of gold, there are all the benefits of Bitcoin. And Nick believes that the competition, the free market competition for banking services with minimal regulations from the government is a interesting thing that is unfolding. And where the regulations from the government break down, the rules and regulations from

• 3:40David Hoffman?

  the Bitcoin blockchain come up to replace them, you know, the 21 million hard cap, the easy to verify, etc. So that's always, that's always an interesting perspective that Nick particularly thinks a lot about. And then we go into one of my favorite subjects, which is also going to be the subject of my next article coming out in Bankless next week, is the progress of these nations that have, that human civilizations have moved through throughout time. So these different organizational schemes such as religion, and then the nation state, and now Bitcoin and Ethereum, these all represent very similar constructs that humans organize and stitch themselves together through.

• 4:20David Hoffman?

  And so we kind of talk about the commonalities found in each one of these different nations, civilization schemes that that enable humans to coordinate and transact with each other. And so that's, that's where we finished off the episode and I'm really excited to release that article next week in Bankless.

• 4:37Ryan Sean Adams?

  Yeah, by the time you guys listen to this, it's coming out on a Monday, it'll probably be the Wednesday. So it'll be like this week, your time when you're listening to this, that you'll be able to catch David's article on Bankless. David, let's get to the big picture, but before we do, want to talk about some incredible Bankless tools from our sponsors.

• 4:57David Hoffman?

  Our first sponsor is Monolith. If you guys have your assets inside of Ethereum, but you also want to live your life, Monolith for our European customers might be the product for you. They have their DeFi card, which is a Visa card connected to a smart contract wallet on Ethereum, so that when you go to the store, you buy your coffee, you buy your groceries, you swipe your Monolith card, and then your die gets deducted out of your smart contract wallet, sold for dollars, and then you make a, both a transaction on Ethereum and a transaction on the Visa network. Really crucial infrastructure for people that want to live a Bankless life, but don't really want to compromise and be that weird friend that doesn't have any real money.

• 5:42David Hoffman?

  So you can download the app at monolith.xyz to get your Bankless Visa card today, and then you can get some of the world's economic activity placed onto the Ethereum network.

• 5:53Ryan Sean Adams?

  All right, guys, I am super excited to introduce you to our next new sponsor, Ramp. What is holding crypto back? It's really getting fiat into the crypto system. That's what's holding DeFi back. The problem is, a new user has to create an account with an exchange to buy some crypto. They have to wire funds. They have to go through a whole bunch of steps. What's holding DeFi apps back? The exact same thing. Users drop off in the signup process, and it really limits the DeFi market to hardcore crypto people, but no longer. Ramp solves that. Ramp has a delightfully easy Fiat on-ramp service. So let's users get crypto ETH, DAI, USDC in five minutes or less.

• 6:38Ryan Sean Adams?

  That's right, five minutes or less, no exchange needed, and a new user can have crypto right into their account and start using the app. So if you are a developer, this takes about 10 minutes to implement. They've got very easy to use APIs. Apps like DeFi, apps like Xerion, Ethereum, Taurus are using Ramp. You can visit ramp.network to see how easy this is. This is really an opportunity for DeFi developers to 100x their addressable market size. This is like the ultimate growth hack. And here's what's cool. If you mention Bankless, they will on-ramp the first 100K

• 7:19Ryan Sean Adams?

  from your app of USD free. So that's 100K free when you mention Bankless. Go to ramp.network and check it out. R A M P dot network. Mention Bankless and check it out. All right, David, big picture. I gotta ask, man, how was your weekend? It looked like you had some wild stuff going on. What, what happened last weekend?

• 7:42David Hoffman?

  Last weekend was a big weekend. After this last weekend, a lot of my attitudes and perspectives and focus has really shifted. I'm of course speaking of the riots, the protests, and the police brutality that has flooded the nation in almost every single major city. On Seattle, me, my sister and my brother-in-law went down to downtown Seattle to protest extremely peacefully. And I worked my way up to the front of the crowd, just to be there, just to experience it all. Spent about 10 minutes there before the police started marching forward and indiscriminately pepper spraying, which I got a faceful of.

• 8:22David Hoffman?

  Then I went home to shower and clean off because pepper spray is not fun. And then I watched the news. And I watched the news about the protests and I watched the news give a police report account of what happened, which was, from my perspective, a total

• 8:40David Hoffman?

  Total fabrication and everyone else I talked to at the the march was a total fabrication. And then we watched, I watched on Twitter, how this played out in basically every single major US city. And so I I feel, I felt, and I still feel very radicalized about this. I I feel that the police are not the police, but they are instead a police militia. I feel like they are over equipped with thousands and thousands of dollars of of gear. Bulletproof vests, bulletproof helmets, like hard face masks, you know, heavy batons, riot shields, the the full works. And their civilians, the civilians of the of the city are are people in jeans and and running shoes, and that's it.

• 9:23David Hoffman?

  And it doesn't feel like they are the police, they are, they are a tool of the state. And that's, some people have been always saying that that's what the state is. The state always has this stance towards the people because the people are the one thing that can remove the power of the state, especially in in America, where the American government and every state government, the federal government, is a protocol that allows for the people to change the protocol. And so the current instantiation of the people in power are always at the whim of the people, who hope that they can remove them from power if they so choose. And so I've just become extremely cognizant of this stance, again, from the state towards the people,

• 10:06David Hoffman?

  that does not always have the best interests of the of the people. And that, and I've been focusing on that, especially as it relates to how crypto systems work at large, where crypto systems are inherently neutral and cannot have a stance towards people. They just are tools, they just are protocols for us to use and leverage. And this is something that I've just been thinking a lot about lately.

• 10:30Ryan Sean Adams?

  Well, I want to get back to that some more, but I've got to ask, just like practically, I've never had pepper spray in the face before. What is that like? What does that feel like? How do you get it off?

• 10:39David Hoffman?

  Pepper spray is oil based, it's oily and sticky, and it shoots out like a super soaker. And so when you get it on your skin, it doesn't, you don't. Wipe it off. It's not like a liquid. It is like a paste. And they were aiming for the eyes and I got it right in the eyes. It felt like bee stings in my eyes, like everywhere. I was immediately disoriented and discombobulated. I could not see. Two seconds later and I had to, people were around me and I just had to ask for help because I needed, because they were, the police officers were advancing, right? Without warning, by the way, they just told all the police officers that they're going to start advancing and they started taking steps forward and the pepper spray was brought out. Two seconds later, two full steps into the crowd.

• 11:22David Hoffman?

  And so I had to turn around blinded and I had, I had my video on, on my camera on Instagram live. And so if you guys can see this video in person and be with me if you guys want to experience that. But I had to ask for help. I had to say like, hey, I need help. I can't see anything. And so people, people put their arm around me and walked me back from, from the police officers as they advanced. I was immediately disoriented.

• 11:48Ryan Sean Adams?

  I think it's important to listen to people's experiences because everyone has experienced what's going on in the US in a different way. But you were talking about the, the protocol of, of the United States, David, and written in the first amendment of that protocol is the freedom to peaceably assemble. And when that starts to get taken away to the extent that, that it is, it's a breach of our protocol. That the US constitution, the amendments are essentially America's settlement layer. That's what preserves law and order. That's what we, that's our social contract.

• 12:27Ryan Sean Adams?

  And so I certainly get alarmed when that is looking like it is being breached. And I can understand from your experience how, how like you felt like that was being breached, you know, here you guys are assembling peaceably. And you're just broken up for seemingly no reason. I, I do think that a lot of the media wants to paint this as a right versus left thing. And I would say that, you know, bankless is not a commentary on nation state politics, but it.

• 13:00Ryan Sean Adams?

  Does have a political position. The bankless platform is absolutely. It's not a right versus left thing, but it is absolutely an anti authoritarian movement. Authoritarians, of course, want to control. They want to dominate. They want to take over. And the bankless movement is about self sovereignty. It's about freedom. So whether you're right on the political spectrum or or left on the political spectrum. If you're listening to what we're talking about, if you're involved in crypto and involved in DeFi. Chances are you believe those things too. You believe in the self sovereignty of individuals and are against authoritarian states that would try to strip those things away.

• 13:43Ryan Sean Adams?

  Protocols, not kings is our mantra, wouldn't you say?

• 13:46David Hoffman?

  Absolutely, absolutely. Every single protocol on Ethereum and Ethereum itself and Bitcoin itself is a protocol that used to be in the responsibility of the state that the protocol is now can now assume. So, you know, the the state and the IRS and taxes and reporting and auditing. All of these things that companies and individuals and businesses have to do is give the IRS and give the state, give the powers that be like a report of where all the value is. And it's really the tool that the United the United States system at large uses to understand where all the value is in the world.

• 14:28David Hoffman?

  And because the world is on the dollar system, the United States government gets to see at like in a panopticon type of way. Where all the money is. And because they control the protocol of the US dollar, they control the auditing of the US dollar. And so getting getting back home, I immediately understood much better. Why Ethereum nodes need to be able to run through Tor. Why we need to be able to run an Ethereum node with or without the state's permission in whatever capacity that we want. Because if Ethereum can run through Tor, there's nothing that they can do. If if the United States got hyper authoritarian and they banned Ethereum nodes and Bitcoin nodes. That would make these systems a little weaker, a little more fragile. But putting.

• 15:12David Hoffman?

  Putting these systems through the Tor network so that everything can be hidden from the state is really important. And this maybe seems like something radical that only a radical person might do, but we've seen people get arrested for the things that they have put on Twitter, even in the last three days. Things that people put on Instagram. The state is watching social media and they're arresting people from what they have been posting. Granted, what they were posting was illegal, but that's where it starts, right? Like first it starts from just the illegal stuff and then it moves forward into maybe more subjective stuff.

• 15:50David Hoffman?

  And so I'm immediately cognizant of how incredibly exposed I am because of the exposure I have towards being such a pro crypto person on Twitter, on Instagram, talking about how this removes the power from the state and puts it into the hands of the people that I have left a trail of that sort of behavior. And so in China, I would have been arrested, absolutely. And so I'm now cognizant of privacy and the ability to run Ethereum through Tor in a private manner so I can have my freedoms.

• 16:24Ryan Sean Adams?

  Yeah, absolutely. And this is not about doing anything, you know, illegal in the current system or illegal with respect to the constitution, but authoritarians could crack down for whatever reason that they want to. And bankless in crypto is really a hedge against the rise of authoritarianism. I want to maybe leave this kind of our big picture with one thought, and that's the focus of this movement is also not burning down the existing system. You know, the response to this can be, we're frustrated, let's burn everything down. I think, you know, that's one response.

• 17:09Ryan Sean Adams?

  It's not necessarily the response that we want to take. The response we want to take is build it up. So what we're doing in crypto is we are building from the ground up an entirely new monetary system that enshrines- Enshrines self sovereignty at its core, it enshrines algorithmic issuance, non-state interference at its core, at the base layer, and then builds up from there. And I think that is something in these increasingly authoritarian times that is worth spending time on. Okay, before we get to the Nick Carter interview, want to talk about our sponsors.

• 17:45David Hoffman?

  Aave is a DeFi lending and borrowing platform with some new cool features that you might not be used to compared to other borrowing and lending applications on Ethereum. First and foremost, the feature that stands out to me the most is their fixed interest loans. And so, you know, variable interest loans can get pretty hairy, right? So Maker Dow launched at 0.5% and then it slowly skyrocketed, it slowly ramped up to 20%, which is, which is a very wide range of possible interest rates. And it's not really sustainable for, you know, some of the more typical things. And so that's where Aave comes in with their stable, non-variable interest rates, where you can lock in a specific interest rate and borrow against, borrow assets using that interest rate

• 18:30David Hoffman?

  and being able to depend on that fixed interest rate. Really important, a really important money Lego that we need in the DeFi space to really have DeFi grow and mature in a dependable way. But that's not all you can do. You can also do flash loans on Aave, which is also a brand new money Lego, where you can borrow, you can borrow assets without any collateral, so long as you also repay it back in the same transaction. So there's a lot of potential here. If you want to pay back collateral, but open up a different loan with different collateral, you can do that all in one transaction without all the slippage costs. So Aave and their flash loans allow you to do that.

• 19:09David Hoffman?

  They are the number four biggest application in DeFi, coming in at 70 million locked in DeFi right now. The bankless community really loves Aave. And we've just been watching Aave climb the ranks of the, of the DeFi market cap. So check them out at ave.com. Deposit crypto to start earning or borrowing. Any Ethereum wallet will work, so try it out.

• 19:32Ryan Sean Adams?

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• 20:15Ryan Sean Adams?

  set access controls. You can take your stablecoins and some of your assets and you can earn interest with various money protocols while you have them parked inside of the Multis account. You can streamline payments. They're also adding fiat on-ramps. So there'll be a bridge to traditional finance with US dollars and euros. You can open an account. This is super easy to do. We've actually featured it and written about it on Bankless. We will include an article in the show notes, but what you need to do now is open an account and try it out at www.multis.co. So that's M-U-L-T-I-S.co. And of course, we've got

• 20:57Ryan Sean Adams?

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• 21:25David Hoffman?

  All right, guys. Let's just go ahead and get right into the interview with Nic Carter.

• 21:37Ryan Sean Adams?

  David and I are here with Nic Carter. Nic Carter is a writer. He is the co-founder of Castle Island, which is a venture capital company. He's also the co-founder of Coin Metrics, which I use on a weekly basis. Nick, we've been waiting a long time to have you on Bankless and we are really excited to dig in today.

• 22:01Speaker 02

  Happy to be here. Thanks for the invitation, guys.

• 22:03Ryan Sean Adams?

  Nick, you know what? I think there's a lot we could cover today. We want to keep this conversation dynamic and casual. Like, we've been very influenced by a lot of the things you've written in the past. But I'm just gonna dig in with sort of an initial question to get us started here, which is, are you an Ethereum? Is there any part of you that is an Ethereum? We know you're a Bitcoiner. And you can be both, by the way. David and I would both consider ourselves both. What's your take on that?

• 22:32Speaker 02

  Man, you guys have thrown me right into the deep end first.

• 22:36Ryan Sean Adams?

  That's how we do it.

• 22:38Speaker 02

  Feels like a trap. So, like, maybe we should define what that means, you know, Ethereum Bitcoiner. So, like, my preferred definition of Bitcoiner is like, someone that just believes or kind of effectively endorses the values inherent in Bitcoin. So, you know, A acknowledges that it's important that there's like monetary commodities that exist outside the state, and then B, like, you know, is pretty interested in property rights, and then C, you know, like, the other kind of like assorted values that like underscore Bitcoin. So, I think you don't have to like own Bitcoin to be a Bitcoiner. You just have

• 23:20Speaker 02

  to kind of agree with the kind of the thrust of the philosophy.

• 23:27Speaker 02

  For Ethereum, like I would say the values are like slightly more diffuse, like they're not as well codified. Like there aren't totems to rally around like 21 million units. It's more like commitment to like rapid iteration and more expressivity.

• 23:50Speaker 02

  But I would say it's like probably slightly harder to define what the the core values in Ethereum are. The other thing is probably just owning Ethereum makes you an Ethereum, right? So, I mean, I own some, like I've I've made Ethereum transactions. So in that sense, yes, in terms of the values, like I would want to see them like codified. So that I can evaluate them.

• 24:23Ryan Sean Adams?

  Well, so let me ask this, Nick, what's your impression of the Ethereum value system today? Just raw impression?

• 24:30Speaker 02

  I think it's it's like still fairly malleable for better for worse. You know, it was interesting to see the the Prague Power debate develop. Because that was something that was like kind of stipulated, the ASIC resistance was stipulated in the in at the yellow paper, I think. And then there was like a constitutional debate almost. And it was like, well, you know, like these stipulations don't matter, like the world has moved on. We've learned a lot. It's kind of like how in the Second Amendment debate, it's like, well, the, you know, the founding fathers didn't envision, not to like make this super topical or anything.

• 25:13Speaker 02

  The founding fathers didn't envision, you know, machine guns or, you know, really cheap consumer grade like, you know, technology that would give civilians lots of killing power. So like you have to read the text in context kind of thing. It was reminiscent of that in that like there was a rejection of like a constitutional stipulation. And you know, an embrace of like modernity, so to speak. I don't know if that answers the question, but yeah, I'd say fairly malleable. However, it seems to be getting more like Bitcoin like over time. I don't know if you guys have noticed.

• 25:56David Hoffman?

  Hundred percent, hundred percent.

• 25:58Speaker 02

  Like A, the governance process has become more difficult as like more stakeholders have emerged and they are heterogeneous and they're like objectives.

• 26:10Speaker 02

  The pace has slowed down, the pace of change, which is necessary. The focus on Ether as a financial, like a monetary commodity has intensified. So in a sense, like, there's been a convergence of sorts in terms of the like values. And the other thing is,

• 26:36Speaker 02

  I would say there's been much more of a focus on like, how does Ether itself monetize, which is maybe the focus of this conversation? As opposed to in the in the very earliest days, like from what I remember of the discourse, it was more like, well, you know, it'll just happen. And the monetization is just kind of a contingent function of the system's growth and like, we don't know exactly how it's going to happen, but it probably will if we build something important, valuable. Now I'd say there's a much more deliberate focus on, well, how do we ensure that Ether is valuable?

• 27:14Speaker 02

  You know, how like, how do we retain the monetary premium that's developing? Which like is reminiscent of like Bitcoin philosophy, I would say.

• 27:24David Hoffman?

  I really want to emphasize the my beliefs of in agreement that Ethereum is trending towards a lot of the same values that uphold Bitcoin. And I think that we would see this, and it's not Ethereum dependent or Bitcoin dependent. I think all crypto systems that would have emerged, that were like crypto systems that were predicted to emerge back in The nineties, right before crypto was even a real thing. We could have, in hindsight, this is more obvious now, but some of these values are required for these things to work, right? And so the Prague Pao debate was this debate about removing politics and governance from the system, saying that Prague Pao is a system that benefits one group of people over another,

• 28:08David Hoffman?

  and for that reason, it should not be included. And we saw that also with the vehement rejection of on-chain block reward funding for developers. That was, that was a very contentious proposal that got swiftly struck down because of the political nature and the inherent acceptance of the need to have a neutral protocol on Ethereum. And then also, as you said, the moneyization, the financialization of the L1 blockchain, where the value of the block space needs to be scarce and needs to be in demand and perhaps only is really suited for financial activity. I see all of these things that, that maybe perhaps on accident,

• 28:53David Hoffman?

  I don't think a lot of Ethereum would say like they, that they agree with Bitcoinerism, but at the same time, all these values are emerging regardless. And I think it's, it's not, and they're not Bitcoiners values, right? They're not Bitcoin values, they're just the correct values that match what needs to be involved in creating a successful crypto system.

• 29:15Speaker 02

  Yeah, that's very well put, actually. And I think there's a few things where you can say definitely Ethereum has become more proximate to Bitcoin value-wise. As you say, the monetary primacy of the system, you know, although, you know, there's still non-monetary uses of Ether, but I think the monetary ones are kind of outweighing them. The layered approach to scaling, I mean, you know, TBD, I guess, but like certainly there's been much more of an embrace of layered approaches as like it's become clear that like there are real constraints in terms of the data overhead that a system can tolerate.

• 29:59Speaker 02

  And what was the other one? Oh, yeah. So this thing that you that you mentioned, like a rejection of protocol derived financing, that's like a very important thing, in my opinion. Because it that kind of thing leads to capture, in my opinion. It like kind of really dramatically raises the stakes and turns engineering debates into political debates. And it, yeah, I think that would have been a recipe for disaster. And, you know, that's certainly something like Bitcoin prides is not converting ownership of units of the currency into like political power, which can then turn into, you know, a positive feedback loop.

• 30:43Ryan Sean Adams?

  So Nick, you've you've written quite extensively about sort of how these networks change over time, specifically their narratives. And we'll include one of your articles on this in the in the show notes here. You know, Bitcoin in its early days was many things, but store of value digital gold was a smaller portion of it than it is today. There was a contingent that wanted to make Bitcoin a peer to peer cash system. That contingent ultimately left. They forked out. They created their own community ecosystem network Bitcoin Cash, right? Do you see a similar sort of thing happening in Ethereum where like people who believed

• 31:24Ryan Sean Adams?

  more in this this sort of the more nebulous web three vision, you know, decentralized internet vision, people who are OK with issuing tokens to developers in an arbitrary way as a reward system? Those people are essentially forking out and creating their own ETH killers. Is that how you're seeing what's going on in Ethereum right now?

• 31:46Speaker 02

  Yeah, I think that's that's a correct interpretation. I haven't like paid too much attention to like the the politics of the various ETH killers, but from like the shallow look that I've given it, it does seem that there was like kind of a big tent kind of mentality early on when things were like pretty harmonious and like the the nature of the protocol hadn't really been clearly defined and people were projecting onto it.

• 32:14Speaker 02

  Features that they wanted. And then when it wasn't borne out that way, and when it kind of failed to develop in the way that they may have liked, they, you know, expressed frustration or just left and sort of alternatives, which is, I guess, like the beauty of the industry, but also, you know, like if you're interested in having the biggest possible network of users, it's also a loss. But just like on the topic of that article, it's like, it's funny that it has so much currency and it gets quoted so much. It was like a 10 minute exercise that

• 32:52Speaker 02

  I did. And then I was like, I made the chart, just like on my kind of like gut feeling. And then I was like, I went to Hasi, I was like, do you want to write this into an article? And then it became this whole thing. And now people cited it as if it's like canonical, it's like, oh, yeah, like the, the digital cash contingent was like 10% of the discourse in Bitcoin's early days. And like, those numbers are pretty much made up, just based on my like recollections. So, you know, it's not canon. Like, I would welcome another attempt, you know, someone else should should try it and, you know, come up with a better version or something.

• 33:36Ryan Sean Adams?

  Yeah. And I'm hopeful somebody actually writes one for Ethereum too. I've seen sort of one version of it that I personally didn't agree with.

• 33:43Speaker 02

  Yeah, there was one for Ethereum.

• 33:44Ryan Sean Adams?

  Yeah, you know, I felt like I sort of agreed with the take, but I feel like, you know, there should be multiple interpretations of the narratives.

• 33:51Speaker 02

  It's very subjective. I mean, we're talking about like, trying to do what historians do, you know, and like, there's no like canonical history written, as we all know. And I have like subjective views.

• 34:07Ryan Sean Adams?

  The fact that your subjective views, you put them out there and they caught fire, basically, and they're oft quoted and everyone refers to this particular article, that gives it some, I call it meme density, right? Like, you kind of, that's how canon maybe is set in these types of social communities.

• 34:26Speaker 02

  Yeah, I mean, I guess like I'm I'm I'm I sort of like have objections with that article. I think maybe, you know, I was representing it in a pretty flat and linear way. There definitely were like competing intellectual threads in the cypherpunks like pre Bitcoin. So for instance, there were debates over privacy, you know, like Bitcoin isn't that private. Chomium digital cash is much more private, you know. There are debates over whether they should just create a dollar like just wrapped dollars in like digital format or like new native units like Bitcoin, you know, so like they didn't agree.

• 35:08Speaker 02

  And like, I think there are even debates over scaling like Nick Sabo's model was was kind of meant to be layered in a certain way. So like whether they were creating digital cash or a settlement medium, which was digital. Like there were big debates even before Bitcoin. And so in a sense, those debates just got transposed onto Bitcoin once it was created.

• 35:32Ryan Sean Adams?

  Yeah, absolutely. We're going to talk a bit more about Ether the asset and its economic density. But I think this this next concept sort of leads into this. You've written a lot about stable coins recently, including an article in Bankless, sort of posing the question, are stable coins good for Ether the asset or not? And our listeners know that, you know, stable coins are absolutely exploding in popularity. So I don't know, 10 billion or so across various crypto networks. The bulk of those stable coins are now on Ethereum. Can you talk about that a little bit? Are stable coins on Ethereum good for ETH the asset?

• 36:17Speaker 02

  Yeah, that's to me like the existential question right now. And it's not surprising that a lot of debate has focused on this in the last couple of months.

• 36:28Speaker 02

  I think it's a pretty important and general question for not just Ether, but literally every cryptocurrency out there. Can you ultimately compete with dollars or sovereign currency? And now that it's clear that there are ways to kind of insert sovereign currency on-chain that seem to work and like seem to be getting traction.

• 36:55Speaker 02

  It's really night and day in terms of the usage modes and in terms of like what people are using for,

• 37:03Speaker 02

  you know, means of wealth transfer, for medium of exchange. People love the stability afforded by dollars, for better for worse. And there's this existential question emerging, it's like, is there even a role for the native assets in this world? And that's kind of the challenge I would pose to Ethereum's.

• 37:29Speaker 02

  The, the reason that it's like Bitcoin did this interesting, this is one thing where Bitcoin diverges very strongly from Ethereum is that it asserts the primacy of the native unit. And it really kind of repudiates non-native units. And this is like fairly deliberate, I would say. So Bitcoin, I like to say Bitcoin is interested in cultivating its own UTXO set. And not really interested in, you know, giving the time of day to alternative tokens that exist on-chain. And even historically, there have been cases where, you know, counterparty tokens were sort of

• 38:11Speaker 02

  de-privileged in a certain way, whereas Ethereum has been very consistent about wanting tokenization.

• 38:20Speaker 02

  You know, and so now that stablecoins have migrated to Ethereum and other places like Tron to a lesser degree. The question is like, are people going to still use the native token? Certainly, I think it can be configured such that there's always a usage for ether in gas as a taxation, you know, kind of element. But you can't, I mean, the protocol can't mandate that, you know, transfers occur in the medium of ether. So that erosion is, I would say, potentially troubling. But then, you know, the reaction, the response to that is to say, well, actually, these are not the same asset. They don't have the same settlement assurances.

• 39:05Speaker 02

  One of them is liability free and one of them is impregnated with liability. And native crypto assets are worth something just because by virtue of the market. Whereas dollars on chain are worth something because there's an administrator somewhere that is guaranteeing their value and guaranteeing access to redemption. So there is a difference in terms of the assurances. So it's just a question of whether that is a material enough difference such that there's always a room for ether. So I would say it's, you know, very much an open question.

• 39:43Speaker 02

  The other side is that, you know, USDT and other tokens are driving demand for gas. So they're, you know, they're using a block space, which you could say is good because it means that, you know, people need to buy ether to pay transaction fees. So I don't know, it's a, it's like a very complex issue. I, I, I actually haven't kind of made up my mind on it yet, to be frank.

• 40:12David Hoffman?

  I think we're circling around the, in my opinion, what is the one central thing that differentiates Bitcoin and Ethereum at, at their core? I, I, I believe that like the 99% of the genetic makeup of all crypto systems overlap. But what we're talking about here is really that one, that, that big differentiator where Bitcoin, and you said this in my, my other podcast, POV. Crypto pod and it's stuck in my head where the Bitcoin blockchain serves BTC the asset. But with Ethereum ether, the asset serves Ethereum, the chain. And this has always been baked into the values of Ethereum, right?

• 40:52David Hoffman?

  Like Ethereum, there, there's no, there was never any doubt that in order for Ethereum to be successful, it needed to have other things on it, not just ether. You know, ether is meant to support other economic activity on Ethereum. And Ethereum has always been designed to be expressive and flexible enough to have a maximum amount of economic activity. And as you said earlier, we just, I think the designers of Ethereum were like, just assumed that with high amounts of economic activity on Ethereum, that the value of ether would just increase commensurately for whatever reason. Like, we don't really know what that reason is, but you know,

• 41:35David Hoffman?

  where, where there is high value and high value flow, ether is just highly, highly exposed to that just by being proximate to it. And, and so I just wanted to get your thoughts on that.

• 41:48Speaker 02

  Yeah, I mean, I think in, in, I would say in both communities, you have these assumptions, which are kind of just taken as given, which aren't like sufficiently interrogated. So, you know, in Bitcoin, there's been this roiling debate for a while about the security. And there's a big camp that just states effectively, it's fine, don't worry about it. And in Ethereum, I would say the kind of this, the analog there would be the folks that just presume that ether would be valuable if enough usage, you know, accrued to Ethereum, the blockchain. And I'm interested in interrogating that for sure.

• 42:34Speaker 02

  Because I, I'd like to, you know, really identify the causal mechanisms there. And I've seen probably some complacency around this. I wouldn't accuse you guys of complacency. I mean, I've definitely seen your work trying to identify those mechanisms. But this is a new, a new science, you know?

• 42:58Speaker 02

  There's no established valuation template here.

• 43:02Speaker 02

  So it's kind of up to us to determine how value sustainably accrues to a system, which is novel and which doesn't have kind of a nation state to, you know, insist on its usage, you know, within its borders, so to speak.

• 43:20David Hoffman?

  So the two mechanisms that Ryan and I have identified that aren't just guesses that proximate ether location to economic activity means that ether price is going to go up. Two concrete mechanisms that we've landed on are the fact that like with a stablecoin like DAI, a trust minimized stablecoin like DAI has increased value capture mechanism to the collaterals below it, which is by and large ether. And so ether is acting as this very trustless, as the most trustless asset on Ethereum, ether has undo, like more

• 43:58David Hoffman?

  exposure to the existence and economic activity behind DAI. And, and so for any, if, if we believe that these crypto systems are, you know, the success of these things are, come from the value of being permissionless, decentralized, trust minimized, et cetera, then ether has exposure to that because there is never, ever going to be any asset on Ethereum that has those qualities better than ether, the asset. And then there's also EIP1559, which is a direct linkage to any and all economic activity upon the scarcity of ether and creates ether deflation. So do these two mechanisms resonate with you? And how

• 44:41David Hoffman?

  have you seen these two mechanisms play out from your perspective?

• 44:45Speaker 02

  So I'm totally convinced on your point about Maker DAI. Although Maker seems to be diluting this slightly, which I find to be strange, given their mandate. But yes, so to me, in an abstract way, Maker is a neo-free bank with Bitcoin, or sorry, I got Bitcoin on the mind, with ether acting as the, the trustless collateral. It's kind of a digital species. You know, like when you had the free banking system, you had a liability free asset at the base of that pyramid, which was gold.

• 45:28Speaker 02

  In contrast to Maker, that was actually a fractionally reserved system, you know, historically. But they, you know, there still was this redemption for a species. And Maker is kind of, you know, pretty similar with the difference being that because Ether is pretty volatile, it actually has to be over reserved. But yes, you're absolutely right that that closes the feedback loop between using a dollar-denominated asset and, you know, actually inducing reservation demand for the native unit. So that's like really harmonious. That's a really nice closed loop. And the value isn't bleeding

• 46:10Speaker 02

  out of the system. You contrast it with a stablecoin, which is redeemable for plain old dollars in a bank account. And you could argue there's some value leaching out of that system. And it's not clear to me that it's fully being returned in the form of fees. Like if I, you know, were the dictator of ETH and I could tinker, I would actually probably like, you know, do something crazy like impose a tax on those dollar redeemable stablecoins. And say, if you, you know, if you like, in addition to the fees, like if you want to use our block space, you know, you really, you owe us, you know, kind of

• 46:50Speaker 02

  thing. That's sort of maybe a heretical idea. What's the, the number of the EIP that you mentioned? I should probably know.

• 46:57David Hoffman?

  1559. It needs its own name by now, but yeah, 1559.

• 47:02Ryan Sean Adams?

  Yeah, honestly, it's, it's, it's, it shouldn't be up to you. It shouldn't be up to you to know it. It should be up to the Ethereum community to meme it better.

• 47:09Speaker 02

  Yeah, you guys should do a catchy name. I mean, it's just a hard number to remember. But, you know, so the idea there is that there is fees being burned, a fraction of all fees paid or burned, right?

• 47:22David Hoffman?

  Yeah, the bulk of the fee. Like, we don't really know the specific parameters, but we're estimating above 90% of the fee gets burned and the rest gets tipped.

• 47:31Speaker 02

  This is something that I, I wonder about for sure. So color me not 100% convinced on this in terms of being value accretive. So I also depart from Bitcoin community where, you know, this, it's the same idea. Like when coins are lost, Bitcoiners like to say it's a donation to everyone because Satoshi said that, right? But I actually don't know if I agree with that. To me, the question is like if they're lost and they're subsequently replaced, if that demand doesn't evaporate. But if, you know, I, you know, like my, my great uncle dies and I inherit his coins, but like something gets lost in the shuffle and I'm a Bitcoiner and I wanted those coins

• 48:12Speaker 02

  anyway, am I gonna like, if I go ahead and replace them, then fine, the impact of that loss really is deflationary. But, you know, let's say he dies and he doesn't have any heirs and, you know, his Bitcoins are just lost. Does that really, you know, like how mechanically does that actually, you know, inject value? You know, he just kind of falls off the global order book. I'm not 100% convinced that all, you know, coin burnings or losses are like homogeneously affecting the value in the same way. And so I think, I guess the question for this EIP is like, are the people who are having their ether

• 48:54Speaker 02

  burned, are they going to subsequently replace that ether, you know, and fill up their cup again to subsequently spend more and burn? I guess you would say like heavy users of the chain probably would be incentivized to do that because they just need the block space, you know, from a, in an industrial capacity because they need to do transactions. But, you know, just more generally, I think I would like to, to actually question this notion that all burned coins are necessarily deflationary, if that makes sense.

• 49:30Ryan Sean Adams?

  Yeah, that does make sense. What, what is your thought on the, the narrative value of this though? Right? So, you know, some might say a lot of the, the value appreciation of Bitcoin goes back to the, its scarcity narrative, the 21 million, the like, the mummification of that. If Ethereum has a burn mechanism that reduces its issuance on an annual basis, does that increase the narrative around it being a non-sovereign, speculative, non-sovereign store of value?

• 50:05Speaker 02

  I would say it depends. So. One thing I don't like, not to keep relating this to Bitcoin, but just to make the point. So I, I actually don't like how people enumerate Bitcoin's issuance rate and say that that's an inflation rate. Because it's kind of a totally predefined thing. And so

• 50:25Speaker 02

  to me, like, all the coins already exist and they're just sort of being gradually unlocked over time.

• 50:31Speaker 02

  I guess for Ethereum, there's like more uncertainty about what the rate will be, you know, in a few years. So then it is probably important for investors to, to know what that rate of change is.

• 50:46Speaker 02

  And

• 50:48Speaker 02

  you know, I think probably the, the biggest fraction of the narrative value is just the message to investors that the developers, you know, are really interested in, in driving value to the asset directly. And then the exact mechanism probably doesn't matter as much.

• 51:09Speaker 02

  It's, but yeah, so it's, it's kind of a way to, you know, establish that vote of confidence. Like, yes, we're, we're interested in backstopping the value of Ether and here's our, you know, our current approach. That I would say should be balanced, counterbalanced against the risk of it seeming too arbitrary in terms of like how changes are made. I think there's always the risk that the, some of these changes that, that happen, you know, without this long period of deliberation are interpreted as being arbitrary and kind of capricious.

• 51:49Speaker 02

  I mean, historically, like that hasn't been an issue for Ethereum, but as like the governance becomes more ponderous and kind of more deliberate, I think that might, might be an issue in the future. So I would say generally, yes, like in terms of just being a general signal. But I think there's there's still that risk that it's interpreted as being, you know, too malleable, too easy to change the system.

• 52:15Ryan Sean Adams?

  You know, that has been a strength of Bitcoin. Basically, the credible neutrality of its algorithmic issuance policy. Like, no one has edited it. Everyone knows what it is. It's not going to change. But so as we're talking about like contrast between Bitcoin and Ethereum, I was thinking about this, it sort of strikes me that both of these networks, what they're trying to do is essentially bootstrap the value of their block space. So Bitcoin does this through establishing kind of this 21 million fixed meme, right? Establishing the value of its asset so that it becomes so valuable that transactions on the Bitcoin network, the block space, become infinitely more valuable in the future.

• 53:00Ryan Sean Adams?

  And ultimately, this bootstrapping mechanism ultimately makes security of Bitcoin depend on the value of that that block space as issuance decreases to an approach of zero. Ethereum is kind of doing the same thing, increasing the value of its block space, but it's doing this in a sort of a polytheistic way, right? Like a poly asset way where it's bringing in stable coins and NFTs are welcome and all of these tokens are welcome because they increase the value of its block space. And the the strategy has been fairly effective. So if you look at coin metrics, you can see like daily revenue volume on Bitcoin and Ethereum and, you know, they're close.

• 53:44Ryan Sean Adams?

  Bitcoin is a bit higher, but nothing else, no other networks are.

• 53:48Speaker 02

  Everything else is virtual.

• 53:49Ryan Sean Adams?

  Is that a way? Yeah, everything else is ridiculous. Is that a way to kind of see these networks as both are taking different approaches to bootstrap the value of their block space in order to increase and perpetuate their long term security?

• 54:04Speaker 02

  Yes, they are clearly approaching it in different ways. And like you, I think it's absolutely critical to have robust fees and just sustained demand for block space.

• 54:18Speaker 02

  And.

• 54:20Speaker 02

  I think that's what frees you from the like specter of inflation in a blockchain context. You know, and I think that this has been acknowledged for a while, you know, but uh. If you don't like, cause it was interesting, you like, you saw this, like the, some of the blockchains 2.0 were like, yeah, we're, we're eliminating fees and we're just going to pay for it with inflation. It's great. It's like much more convenient and uh, no one has to worry about fees ever again. And that now we have this like reaction where there's a realization that that actually has lots of like issues and like all sorts of like ugly, uh, you know, outcomes there.

• 55:02Speaker 02

  And I think there's been a recognition that the, the fee driven model or like primarily fee driven model is better in some ways. So, you know, fees are like a proof of work, like they disincentivize you from submitting uneconomical or spammy transactions. And that's totally worth something because there's a real externality in terms of node operation.

• 55:27Speaker 02

  And, you know, just by pricing this commodity block space, uh, you know, like I'm in favor of markets. You know, wherever they can exist and uh, just paying for things with inflation is uh, is to kind of reject that doctrine. And uh, and say, well, maybe we can price, you know, we, the administrators of the protocol can price things appropriately and manage it. And I think that's, that's probably been kind of a failure. So yes, it is interesting to look at the data and see that there's meaningful fees on Bitcoin, Ether and uh, virtually nothing else.

• 56:08Speaker 02

  And I think that says a lot about where economically minded entities are actually apportioning their attention these days. And it's a really interesting question. Like we've seen Tether leave Bitcoin. Tether was a source of fee pressure for Bitcoin. You know, there still are kind of arbitrary uses of Bitcoin. There's, you know, open timestamps, similar things.

• 56:35Speaker 02

  I have mixed feelings on the non-monetary uses of Bitcoin, but undoubtedly they help as far as fee pressure goes. So I think you guys are right to focus on this as like the key distinction, you know, in terms of philosophy between the two projects, native access versus just like arbitrary arbitrary usage.

• 56:56Ryan Sean Adams?

  So let's play, let's play this idea out a little bit. When we were talking about this podcast, Nick, you brought up this idea of monetary privacy. And, you know, I think what you're referring to is basically that maybe you see Ethereum sort of taking the route of Bitcoin. So Bitcoin is primarily used to transfer Bitcoin in large quantities. There are a scarce, you know, there's scarce space in Bitcoin block space. So the more economically dense transactions tend to be high value Bitcoin transactions. Right. That only makes sense. You've used the shipping crate analogy to sort of talk about that. And then USDT, stable coins, they move off of Bitcoin because they are less economically dense.

• 57:41Ryan Sean Adams?

  They don't need the security protections of the Bitcoin network. And I think you'd probably, in, you know, your, your framework probably celebrate that. I guess the question is, does the same thing start to happen with Ethereum? So there's more block space on Ethereum. And in the future, with sort of the social contract around scalability, there will be probably more block space on the base layer, but still a scarce amount. I mean, this is never going to be Amazon web services. Yeah, and it, and it has to be, or else it doesn't preserve its decentralization. But is that kind of what happens with Ethereum? Do these less economically dense, the crypto kitties, they move off of the base layer chain and go somewhere else?

• 58:25Speaker 02

  Yeah, it's definitely hard to forecast. I would say on the topic of Tether, like, I probably wasn't actually popping the champagne when Tether left Bitcoin. Some Bitcoiners were for sure. It was like a weird event in that, you know, like both Bitcoiners and Ethereum's were happy about the same thing.

• 58:43Speaker 02

  Yeah, it was like the first time I've seen that.

• 58:47David Hoffman?

  Does that mean that one of these parties is wrong?

• 58:50Speaker 02

  Yeah, yeah, someone has to be wrong, right? Exactly. But, you know, it's also kind of a relief. It's like, well, maybe Tether isn't as linked to Bitcoin anymore. So maybe that's good. I don't know.

• 59:05Speaker 02

  But you're right, you know, and one like very straightforward example of this is Veribloc. So Veribloc was this, I think it still exists, is this protocol that would borrow Bitcoin's security and use it for other altcoins. So they could sort of, you know, link their their blocks to Bitcoin, you know, periodically and sort of inherit Bitcoin's security, which is a pretty common idea. We've seen a few altcoins do this, kind of like a merged mining style thing. But Veribloc was offering a fixed amount of, you know, it was bidding a fixed amount for Bitcoin block space.

• 59:46Speaker 02

  And when Bitcoin block space was really, really cheap in 2019, it was occupying, you know, 20, 30% of Bitcoin block space. And then as fees rose, Veribloc got marginalized because the fixed amount it was bidding, you know, that bot that acquired less and less block space. So that's a very simple example of this process whereby the most economically dense transactions eventually, you know, price out the the kind of less.

• 1:00:25Speaker 02

  I don't want to call them spam because people, that's like a really loaded word and so on. But, you know, the less economically minded transactions. And like the analogy I would use is like, if you think of each block as like an empty cup and you have liquids of varying densities. And the more denser, the more kind of, the larger the transaction is, the happier you are to pay, you know, a heavier fee that that, you know, imagine large transactions is like very dense, like viscous liquids.

• 1:00:58Speaker 02

  In each block. They sink to the bottom. They get inclusion. You know, they didn't get inclusion in the cup. And then the lighter liquids, you know, they spill over the edge. They don't even make it into the cup. Right. And so because block space is scarce and bounded, I think in the long term, it's the largest transactions that are gonna, those transactors are going to be willing to bear a higher fee in absolute terms, you know, to move their like large amount of assets. And those basically price out the smaller or even not economic transactions. So that's the theory behind this idea that blockchains probably in the long run have this, this kind of

• 1:01:42Speaker 02

  economic primacy or monetary primacy. And like, we kind of see this in Ethereum too, like as fees have risen due to mostly stablecoin usage, I would say. And like, if you look at stablecoin transactions, they tend to be pretty big. These are like kind of bigish settlement transactions. As fees have risen, stuff like deploying a DAO on Aragon has gotten really expensive because it's pretty complex, like it requires a lot of gas. So to a certain degree, those are being priced out. And so like Vitalik had a thread today saying, you know, blockchains started out being purely monetary in nature and now they're moving on

• 1:02:24Speaker 02

  to, to, you know, harboring a real diversity of use cases and actually minimizing the monetary element. I actually think it's the opposite. I would say as long as there is scarcity in block space, the monetary usage is probably going to win out just for simple economic reasons, for the simple reason that if I'm transferring a million dollars, I'm happy to pay $10 in fees. Whereas, you know, that, so that outcompetes like a, like a smaller transaction, basically.

• 1:02:53Ryan Sean Adams?

  Yeah. Can I just say, like David and I were talking about that thread and like, I totally agree with you. Like I, I disagree with those aspects of Vitalik thinking that the blockchain can be useful for everything. It just tends to be the case that money use cases outprice everything else.

• 1:03:08Speaker 02

  Yeah. It's just a question of economics, right?

• 1:03:13Speaker 02

  I think so. And like unless, I mean, you know, I've misunderstood charting or, or something in the roadmap for Ethereum, in which case like there really will be an abundance of block space and then things will change. But, you know, I, under the way that I currently understand blockchains, you don't ultimately really even want to allow arbitrary usage. I think it was actually Greg Maxwell that said this. He said something like, there is unlimited demand for highly available replicated storage, uh, which is free. And we kind of see this, like, if you look at the usage traits of BSV or BCH, people just use these to store data.

• 1:03:55Speaker 02

  And that usage mode is like pretty wasteful, I would say, because that data is only relevant to the person uploading it and they may never want even to retrieve it.

• 1:04:09Speaker 02

  Whereas a, you know, moving money around, moving the native unit around in particular, that's likely to be relevant in the future. You know, so the, the cost that that data is imposing, that's a cost that, you know, the, the system should be happy to bear, because it's likely that that those, you know, that storage requirement isn't just being wasted long term.

• 1:04:33David Hoffman?

  So what you, a lot of what we are illustrating is, is, uh, talking around the concept that, that Ryan and I have been harping on, which, which is a, a term that I got from you. You said you didn't coin it, but I don't know who else did. It's settlement assurances, uh, and the primacy of a base layer that is, is moneyness and monetized, contributes to what we've been calling settlement assurances, which is the assurances that your transaction is going to settle in a way that you is, is expected to. And this is in stark contrast with something like, like Stellar, which you have called like a, a landfill blockchain, where just all of the trash just gets dumped on, on Stellar, because it just doesn't matter, because there's no fees.

• 1:05:18David Hoffman?

  Whereas the high fees on Ethereum and high fees on Bitcoin contribute to The settlement assurances of these systems, which allow for protocol density, like a high weight system, because all of the money and all the finance and all the value are being added to these systems. And ultimately, therefore, fees are being paid. And the fees are the livelihood of these systems. Like, I think you can accurately predict into the future how long a system like this is going to last, based on how much fees that they have. So, one, can you comment on that? And two, can you kind of illustrate how you see settlement assurances and its role in these crypto systems?

• 1:06:00Speaker 02

  Yeah, yeah, yeah. So, you know, I think you can predict safely that systems that are meant to be capped, like, you know, coins where issuance is meant to be capped, absolutely need fees in long term. And the ones that are capped and have zero fees right now, which is a lot of them, a lot of the forks of Bitcoin, will be forced to reintroduce to inflation if they can't, you know, accrue a significant, a sufficient amount of fees. And I would add, this is also a challenge the Bitcoin has to face, too. And I'm not exactly sure what sufficiency is, but I know that zero isn't sufficient. So, you know, that much we know. And if you reintroduce inflation, I think,

• 1:06:45Speaker 02

  you know, and that's contrary to kind of the established social contract, I think you've basically failed. So, you know, that much is clear to me. It's interesting that the, the kind of core logic of blockchain security changes as you go from a subsidy-driven regime to a fee regime. Because in the subsidy regime, you really want the native unit to be valuable. And so, it's important to emphasize, you know, reservation demand for the native unit. But then, in the fee-driven regime, the kind of unit value of the native token doesn't matter as much. And what matters is just inducing transactional usage.

• 1:07:30Speaker 02

  So the the nature changes somewhat. I think we still don't know for sure, you know, we're still in like the hypothesis stage here of determining whether the public blockchain model, the like dominant model does generate like sufficient assurances in long term.

• 1:07:51Speaker 02

  One thing I worry about is that the assurances change from being crypto economic assurances to being kind of institutional ones where you have a certain kind of consortium of entities that actually guarantee settlement. And so then settlement becomes less a fact, a function of being buried under a certain number of blocks and more a function of just effectively being in the good books of the the guarantors of the system. And there's a few ways this could happen. One would be, you know, if mining became strongly cartelized and you

• 1:08:33Speaker 02

  had big custodians that had contractual relationships with miners and independent miners got forced out and then the custodians could be the arbiters of what got mined. And, you know, let's say custodian got hacked, they would have a really strong incentive and like having the ability to conduct reorgs and so on. That's one way I could see this getting institutionalized. The the capture of a lot of the the token supply on exchanges is is a risk, I would say, in this context, you know, with custodial institutions. And especially as you move towards a proof of stake world, it's kind of an even bigger risk because

• 1:09:17Speaker 02

  they start to have kind of discretion over the system features, which we saw with Steam. I think that was a great example. The fact that so much Steam ended up on exchanges introduced this like principal agent problem where the entity controlling Steam and using it to vote on things was not the owner of that Steam, but merely the custodian. So I think it becomes much more likely to have these kind of failure modes in a proof of stake world.

• 1:09:53Speaker 02

  So then the challenge is to like, make sure it doesn't end up with with third parties. So I do think there's a risk that these systems go from being, you know, crypto economic in terms of the the settlement assurances to being institutionalized, which would turn them into systems that are pretty similar to to like the the normal payment systems that we have today.

• 1:10:17David Hoffman?

  So one of the the concepts that I keep on harping on is the linkage between your settlement assurances and the promises that you have that you can plan out your financial life into the future and long term thinking and planning, right? Like, a lot of Bitcoiners speak of low time preference and they say that Bitcoin and how stable of a system it is and the 21 million hard cap and the Austrian money produces and and the strong settlement assurances of Bitcoin, including its censorship resistant resistance, all gives these assurances that Bitcoin is going to be the same thing as it is today into the future, and that allows you to plan around that.

• 1:10:59David Hoffman?

  And settlement assurances provides that, which is also linked to to property rights. So I was hoping to get your your perspective on just the intersection between settlement assurances, property rights, and long term thinking and planning, and why all of this is important.

• 1:11:13Speaker 02

  Well, settlement assurances doesn't fully do it justice. There's settlement is just one part of the life cycle of using a blockchain. You have the acquisition, you have the steady state, you know, and then you have like the divestment state. And what you're referring to, I think, is actually the steady state where if you own, if you have the private key corresponding to a public key, which has a balance in that address, then you have an absolute claim on that indefinitely. And that is a that's a very strong property right. It might even be the strongest form that has ever existed.

• 1:11:54Speaker 02

  I mean, it's so strong that it's brittle, you know, like some of the strongest like metals like tungsten are really brittle.

• 1:12:02Speaker 02

  But the the reason it's brittle is that if, you know, you can easily lose access to your coins, and then it's a problem. But yes, I think this is the most profound thing about, you know, cryptocurrencies that they give the individual like power over their money, which has not existed previously, and it's very concealable. It's very transportable. Those are new, you know, like there aren't other forms of property that you can do that with.

• 1:12:31Speaker 02

  And that's a very, very profound thing.

• 1:12:35Speaker 02

  So it's kind of important to sanction that absolutely and make sure that that never gets impaired. So when there are, and this is why I was cautioning about arbitrary changes to the system. If there are things which impair those, those kind of property rights for users. I think that really decreases the credibility of the system. So if there are confiscation events or unexpected inflation, you know, which is kind of a more subtle form of confiscation. Those are things which really damage those nice assurances that your coins are going to be there in the future.

• 1:13:15Speaker 02

  You had this happen, it happens a lot with forks because forks tend to be really messy. But I think if you look beneath the surface of a lot of coin, like a lot of long tail altcoins, you'll notice, you'll notice that these confiscation events happen a lot like dev funds will get enlarged or they'll be, you know, increased into perpetuity.

• 1:13:38Speaker 02

  You know, certain coins will become anyone can spend and they'll just get swept. Like there's lots of protocol tweaks, you know. Hash functions will get changed arbitrarily to like, you know, let's say prog power had gone through, you, you might've said that would be an example of this. So there's a lot of protocol tweaks which can like really impair the actual property rights of the users of the system. And I don't know if there's enough of an acknowledgement of that, you know, I, I think like the task of protocol developers is like first and foremost to safeguard the rights of the users. Uh, in this like, you know, cryptographic way and then to develop around that in a way that's safe.

• 1:14:19Speaker 02

  I know like Vitalik has like really consistently stressed that he doesn't really believe in like truly absolute property rights. Which is, you know, consistent with like the radical exchange philosophy. That would probably be one of the-

• 1:14:36David Hoffman?

  Radical markets?

• 1:14:37Speaker 02

  Radical markets, yeah, you know, that's because they stress like really alternative compositions of property. That I would say is another really significant distinction between Bitcoin and, well, I don't know if Vitalik speaks for all of Ethereum, but-

• 1:14:52David Hoffman?

  Yeah, I would say not in that particular case.

• 1:14:55Speaker 02

  Yeah, because I would say that's a pretty risky view because you really do want the the holders of the account space or the UTXO set to know and to be able to forecast many years in the future that they'll be able to spend their coins. Which is why it was so cool to have those coins from February 2009 be spent recently. You know, everything worked as intended. The holder of the keys was able to spend them, you know, like there's a beauty in that.

• 1:15:27David Hoffman?

  Totally.

• 1:15:28Speaker 02

  And I'll do, one thing I'll add there is if you read Finn Brunton's book, Digital Cash, which is pretty good. It's like a prehistory of Bitcoin. He talks about the extropians, I think they're called. And this was like an idea that we should invent digital cash so that I'm probably like bungling it, but digital cash should exist so that people could have a currency that worked for them as they were like sublimated into a kind of digital afterlife. Of, you know, of either being uploaded into the cloud or being cryogenically frozen and coming back in a hundred years and they would need to take their wealth with them.

• 1:16:13Speaker 02

  And that was, and he claims this, that that was one of the inspirations for the creation of a lot of these digital cash schemas. So the notion of like a truly persistent digital asset that you truly own has kind of-

• 1:16:28Speaker 02

  That's been an inspiration behind this stuff even before Bitcoin.

• 1:16:32David Hoffman?

  So I want to turn this conversation a little bit to something I know that you paid attention to and I think are optimistic for with the world of Bitcoin and how that contrasts to the world of DeFi. And that is the free, the concept of free banking. I, if I, if I'm correct in my perception, and I'm not familiar at all with, with free banking, but I think that you think that free banking using Bitcoin as the underlying asset is something that is ahead of us in, in this world. And that I think that that is the, the Bitcoiner version of what we are calling DeFi. Where, you know, where all of that same sort of financial services is found as applications on Ethereum.

• 1:17:16David Hoffman?

  And do you believe, do, does that distinction resonate with you? Is that correct?

• 1:17:19Speaker 02

  Yeah, that's, yeah, I think that's probably a fair way to put it. I would say there's probably some things which you can't foreseeably do on DeFi. This might change maybe that you can do in a, in a private banking context. So one of the big ones is maturity transformation, which is like the core business of banks. I would allege that that's not really possible on DeFi right now, which is, you know, making loans and taking deposits and,

• 1:17:54Speaker 02

  you know, turning those illiquid loan, like getting a yield on those loans that you're issuing and paying that interest to depositors.

• 1:18:04Speaker 02

  You know, I, it's kind of hard to imagine how

• 1:18:09Speaker 02

  you would, a bank would issue you a mortgage in the conventional sense of the word in like a DeFi context. And you guys are probably going to interrupt and be like, oh no, there's like a project doing that. But, but you kind of get the point like, because basically, you know, underwriting loans is like something that requires like credit, you know, and I don't think credit per se really exists in the DeFi context, you know? It sort of relies on this like web of interpersonal relationships and like social security numbers and stuff. And I'll probably be accused of having a very constrained vision here, but I'd say that's probably the big distinction between, you know, like conventional commercial banking and DeFi.

• 1:18:54Speaker 02

  But yes, generally, I think the the inspiration is pretty much the same like the Maker System is a great example of something that is transforming risk in a way that gives a token that users want to use, which is DAI, but also leans on the system's collateral. And in the same way, if Bitcoin banking were to develop, it would be kind of a similar thing.

• 1:19:21Speaker 02

  I think it's both a scaling method and something that is convenient, like people like financial services and they they desire them. We've seen really explosive growth of BlockFi in the last year, to give an example. You know, so Bitcoin native financial services are growing. I think there's demand for that.

• 1:19:41Speaker 02

  I think that's really going to be the case for for the whole cryptocurrency industry, to be frank.

• 1:19:47Speaker 02

  I think you're going to have centralized financial service companies on Ethereum complementing DeFi, most likely, because they have different strengths.

• 1:19:59Speaker 02

  You know, the worry is like too much of the supply being captured by this, but a certain part of it is inescapable. And so, yeah, I'm definitely of the school of thought that banking is and credit creation on top of these assets with the assets as the native collateral is probably a good thing. And it can be better than the free banking era because digital species, you know, like native units are like natively auditable, they're cryptographic in nature, so it's easy to take physical delivery of them. It's easy to verify that someone has them. That's pretty different from gold, which previously was the collateral of these systems.

• 1:20:44Speaker 02

  You know, it's hard to take physical delivery of gold. It's hard to verify and audit gold. So in a sense, those those like nice auditability qualities make this system potentially a more stable and kind of honest system. So that's why I'm always talking about proof of reserves. That's kind of a way to return the guarantees of the collateral to these centralized providers. And I think that is inevitable. I think it's going to happen. And, you know, hopefully, we can sort of ameliorate it by instituting stuff like proof of reserve protocols.

• 1:21:20David Hoffman?

  So the Ethereum attitude here and the Bitcoiner in me, when I put my Bitcoiner hat on compares the free banking with Bitcoin world to the current world and sees just a paradigm shift of improvement that I think we could expect from that sort of world. However, the Ethereum in me is pessimistic about the commitments to a trust minimized, trustless, protocolized world where the use of cryptography is kind of just where Bitcoiners are on this on this train moving into a crypto economic trust minimized sci fi future and they get off on

• 1:22:02David Hoffman?

  the first stop. And they're like, well, you know, I'll call it good at Bitcoin banks. Whereas like the Ethereum seem to be like riding this train until it goes to its logical conclusion and seeing how far that they can take it. Is that a fair, is that a fair take?

• 1:22:18Speaker 02

  Yeah, that's probably a fair critique. I think it was like Arjun Balaji that wrote this great essay about the constrained versus unconstrained vision, which was which he felt was the big distinction between Bitcoiners and Ethereum's. I think, you know, don't like ascribe my opinions to all Bitcoiners for sure. You know, lightning is still pretty interesting and that is trust minimized in a really genuine way. And then what I think will and should happen is for there to be lots of degrees of gradualism between like full custodial intermediation and, you know, true base layer Bitcoin with lots of steps

• 1:23:03Speaker 02

  along the way. But there hasn't been, you know, there aren't like

• 1:23:10Speaker 02

  That many, you know, smart contract, there aren't that many kind of like lightning analogues or alternatives on Bitcoin that exist right now. And so you could say that's because of a lack of expressivity, for instance. So that's why I'm hopeful that we get stuff like Jeremy Rubin's proposal through, which would add expressivity, because that's definitely an easy win, adding some more elaborate, like, smart contracting capability.

• 1:23:45Ryan Sean Adams?

  One follow-up question I have for you then, Nick, is, I do think, not necessarily that your view is representative of all Bitcoiners, but that a number of Bitcoiners do share this view in the gold standard, or, excuse me, in the Bitcoin standard. Saifedean talks about a world where, possibly in the future, you know, there are a thousand banks that, you know, are the only ones able to use the Bitcoin network because of this scalability constraint. And we've talked about why, you know, blockchains will always have a scarce set of block space. It's necessary as part of the design. But going back to David's analogy of the, sort of, the first stop, are we sure we optimized that design space in 2009?

• 1:24:30Ryan Sean Adams?

  And is it really a compelling world? Is it really a bankless world? If, you know, we limit the transactions on the Bitcoin network to those who afford it, like, it's no longer peer-to-peer, it's no longer bankless, the transactions are just high net worth individuals and crypto banks, and then we're kind of back to where we started. That would be, I would say, the bankless main critique of it, that it's not necessarily a better world.

• 1:25:00Speaker 02

  Yeah, yeah, and I've certainly followed, you know, the bankless editorial view, so to speak.

• 1:25:09Speaker 02

  I would say... My first reaction would be, um, blockchains aren't fair, you know, they always do privilege whatever entity is willing to outbid someone else, you know, that was, that was the whole discussion of economic density. So that's just kind of intrinsic to their nature. As long as there's a scarce resource, the highest bidder is, is going to, to, to win that auction. Right? Um, so I would, you know, reject a teleology of blockchains, which insists that they have to be, uh, open to anyone. I mean, they're open by their very nature and that's kind of the reason they're not fair is that they'll let anybody outbid anyone else. Uh,

• 1:25:54Speaker 02

  but you know, there's no notion of being, of having guaranteed access to block space. And I don't really see that changing. Um, but I do, I do, the point is taken. Um, what I would say is, I think where we are in terms of actually compressing economic, you know, kind of economic value down into bytes is still very primitive and we have a lot that we can do in terms of compression. The other thing is that as exchanges move from, uh, individual settlement to a net settlement idea, um, between custodians and exchanges, you actually free up a huge amount of block space. So right now, the way it works

• 1:26:39Speaker 02

  is like individual transactors deposit on exchanges and then they make withdrawals from those exchanges. And that's like a very, very kind of, um, data intensive way to operate. What might happen in the future is that, and then what they do is then they withdraw those coins and they send them to other exchanges, you know, they might get started on Coinbase and then they send their coins to Binance, right? What we might have in the future is just exchanges or custodians where, you know, you deposit and then instead of honoring those individual deposits and withdrawals as they occur, the exchanges start to trust

• 1:27:21Speaker 02

  each other a little bit more and they actually, maybe they only settle up with each other once a day and they settle the net difference between whatever the, the users have deposited and withdrawn. And so instead of having 10,000 transactions between Coinbase and Binance a day, you have one or you have two. And so this is actually already happening, this like this move to like kind of real time growth settlement. And in a sense, it like frees up a lot of block space because the big consumers of block space are actually being much more parsimonious about their usage. And so there's this interesting effect where block space kind of gets easier to access in a sense.

• 1:28:08Speaker 02

  Now, you might like, so Hossu wrote an article about this. He said that in the end, exchanges would be the only consumers of block space. I'm a little bit more optimistic than that, actually. I think right now we are in a really primitive state in terms of being able to compress information.

• 1:28:27Speaker 02

  Thanks to bad fee estimation and kind of poor industrial block space management techniques, you know, like not using batching, we're still really being very wasteful in the usage of block space. The other phenomenon is like rising fees is an inducement to become more stingy in your use of block space. So there's a lot of factors which I think are combining to actually open up block space. But I would say that I would expect that it would be fairly rare for lots of users to make base layer transactions. It'll likely be processed through a layer or two, whether it's

• 1:29:12Speaker 02

  a kind of a more trustless layer like Lightning or a more intermediated layer like banks and exchanges. But yeah, I think that's just the nature of the beast. I think the base layer is kind of a wholesale network. With the retail activity happening higher up.

• 1:29:28Ryan Sean Adams?

  I think we've talked a lot about the differences between Bitcoin, contrasted them anyway, between Bitcoiners and Ethereum, but there is a major difference where we're all united on, if I could say this, is against the centralization of these networks, against the institutionalization of these networks. And I do think it's incumbent upon us to guard against that centralization wherever it might creep in. So a lot of shared values across these communities as well, for sure.

• 1:30:04Speaker 02

  Yeah, definitely. And I try and be pragmatic. If Bitcoiners want credit creation, they want financial services, I'm not going to deny reality and pretend that doesn't exist. And things like credit, those naturally develop. That's like kind of the cornerstone of civilization is credit relationships. I'm optimistic that the nice guarantees of these networks can be preserved even in a financialized world. And there is definitely a contingent of people that are really resistant to the financialization of these networks.

• 1:30:47Speaker 02

  But I think that's kind of out of step with reality.

• 1:30:52David Hoffman?

  I have one more topic I want to harp on, Nick, before we wrap this up. And it's the concept of this march of progress of these civilizations, these organizational schemes that we've seen throughout history, starting, perhaps there's one earlier than this, but perhaps starting with the most salient one, which is religion, which is this organizational system of people that all ascribe to the same set of rules. And it's a protocol of sorts. And there's documentation there in the form of like the Bible, or the Quran, or the Torah. And each of these religions has a group of people that are organized around it. And there's zealots.

• 1:31:35David Hoffman?

  Believers, patriots, and then these religions seem to get supplanted by nations, which basically had more or less the same construction, right? Like a set of documentations, protocols and rules for how to live. Patriots that would consider themselves to be a part of the system and responsible for upholding the values of the system. And we're seeing that same pattern emerge with these cyber civilizations, these cyber systems like Bitcoin and Ethereum, where there is like a white paper, a protocol for describing how to operate, and then the maximalists that make up the system. How do you view the, is that an accurate representation?

• 1:32:18David Hoffman?

  And how do you view this progress of these digital, whatever they are, in context of history?

• 1:32:26Speaker 02

  Yeah, I think that's the nation's analogy is an opt one. And people often say that there's a religious element to blockchains or to Bitcoiners in particular. You know, cryptocurrencies don't make any ontological claims about reality. So I don't know about that. I think that's maybe a bit of a stretch. But yeah, these are digital commonwealths. They are fundamentally arranged around property and rules for how property can be allocated and distributed and moved. And that's kind of the most fundamental thing about the state, really.

• 1:33:11Speaker 02

  There's a set of protections that property is kind of upheld. And there's no police force per se because cryptography helps with all that.

• 1:33:21David Hoffman?

  Well, that's what the miners and stakers are, are they not?

• 1:33:24Speaker 02

  Yeah, yeah, sure. But it's, you know, that's kind of like the system design is intended to remove subjectivity and conflicts. So you don't need that kind of reactive police force. And, you know, that's been attempted. Like I think EOS had this thing where you could like steal back coins if you like. Convinced enough block producers to do it or something, which totally didn't.

• 1:33:46Ryan Sean Adams?

  Oh, God.

• 1:33:48Speaker 02

  Like arbitration form or something. So yeah, they're, you know, they're new, but like most of them, you know, to be honest, are like plots of land in the desert and there's nothing growing there. And there's some like, you know, beleaguered settlers that followed their leaders and their nice promises that they made of there being an oasis. And then they got there and it was just like a dusty wasteland. That's what most blockchains are like. Uh, there's very few that are actually thriving and where people are actually building things on their, their newfound plots of land. Uh, but yeah, I, I totally see them as like homesteads, you know, out there in the wilderness. Uh, and people are, are trying to figure out how to take

• 1:34:30Speaker 02

  advantage of their, their little plots. Um, and with all the messiness that that entails. So the, the, the digital frontier is how I think about it.

• 1:34:41Ryan Sean Adams?

  Yeah. Cause we wrap up. I want to get, get kind of a, a last take from you on this. So we've talked a lot in this episode about Ethereum and Bitcoin. And I think there are some in both communities that are rooting for the other community to fail. I don't think that's you. Um, you, you are definitely pro Ethereum. You don't want it to fail. But to David's analogy, it does feel like the Bitcoin community is kind of getting off the train on the first, the first stop. And maybe Ethereum, you know, DeFi, this bankless movement is seeing if the train can get a little bit farther down the track first. But I want to ask you this question. Do you think it's going to work? Do you think this bankless thing, this DeFi thing can actually work?

• 1:35:25Speaker 02

  Yeah. Should we just bail off the train now or what?

• 1:35:29Speaker 02

  Can DeFi work? Or, uh, well, I don't know what DeFi is. I don't know if I've ever seen a great definition for it.

• 1:35:36David Hoffman?

  Can banklessness work? Is that the question?

• 1:35:38Ryan Sean Adams?

  Yeah, so this whole thing of DeFi protocols doing less with banks, incorporating other money verbs on the base layer like borrowing and debt and lending, essentially creating a blockFi in DeFi, essentially creating a Coinbase trading exchange and a Uniswap in DeFi. These base layer protocols to allow you to accomplish money verbs, the same sorts of things that would be accomplished in crypto banks. Is this whole idea going to work in your mind?

• 1:36:10David Hoffman?

  I think another way to phrase it is just replacing as many financial institutions as possible with protocols, right? So like instead of the NASDAQ, we have the Uniswap, right?

• 1:36:20Speaker 02

  Yeah. Yeah, so there are lots of functions and financial services which are, which can be both codified and automated. I think that's absolutely true.

• 1:36:34Speaker 02

  You know, like what ETF, like what BlackRock does is like pretty straightforward, right? And Vanguard.

• 1:36:43Speaker 02

  So, yes, there are definitely, and you know, structuring certain derivatives. You don't necessarily need a human and a lawyer to do that each time. So absolutely yes, for a subset of financial services activity. I'm kind of yet to be convinced on whether, you know, genuine commercial banking can be kind of inserted on-chain and represented as a set of contract relationships. I think the low-hanging fruit is still, remains to be exploited in terms of

• 1:37:21Speaker 02

  identifying the kind of tedious and automated functions which happen in the back office right now, which can be represented in contract form.

• 1:37:34Speaker 02

  So there's kind of a, there's like a blue ocean there.

• 1:37:39Speaker 02

  And then some of the more complex functions are being targeted now. Which is maybe premature, you know, so it's definitely a question of timing for me. But yeah, I'd give you a qualified yes on that.

• 1:37:51Ryan Sean Adams?

  You heard it here, guys. Nic Carter, this has been a pleasure to chat with you. David and I are big fans, read everything that you write, and it's been a pleasure to have you on the podcast, man.

• 1:38:02David Hoffman?

  We're riding the train all the way until the end. Nick, thanks for coming on Bankless and sharing your thoughts with us. Really appreciate it.

• 1:38:10Speaker 02

  Thank you. This was fun and dare I say challenging.

• 1:38:13David Hoffman?

  Well, I'm glad to hear it. I'm glad to hear it. Thanks, Nick, for coming on and giving us your time.

• 1:38:18Speaker 02

  Yeah, thank you. My pleasure.

• 1:38:21Ryan Sean Adams?

  All right, actions, guys. A few things that you can do. The first is we're going to include some links to some of our favorite Nic Carter articles that you should go read. One is called "A Peaceful Revolution," another on "Settlement Assurances." Go and do that as your first action. The second, which we want you to do, is go back and listen to some previous episodes. Maybe you're, you know, you haven't heard them yet, you haven't heard the archive, but we referred to a lot of them in this episode, so episode two, episode seven, episode 12. Really, those episodes build on top of the things that we talked with Nick about, so go check them out. Lastly, we need those five-star reviews. David, how are we doing on that?

• 1:39:04David Hoffman?

  We're doing okay, but we could be doing better. And so if you guys think that the Bankless podcast and the Bankless Revolution belongs at the top of the iTunes charts and that it should show up when you type in Bitcoin, when you type in Ethereum, when you type in DeFi into your podcast search engine, we want, we want to make sure that Bankless shows up there. And the way that you can help us do that is by giving us those five-star reviews. There's a bunch of old podcasts that haven't put out episodes in years, but since they came in during the ICO mania, they are still kind of sticky at the top of the crypto iTunes podcast charts. So help us replace those ICO-type podcasts and get them replaced by the Bankless Revolution.

• 1:39:47David Hoffman?

  And the way that you do that is those five-star reviews.

• 1:39:50Ryan Sean Adams?

  Guys, thanks for voting for Bankless. Risks and disclaimers, okay? ETH is risky. We talked about Bitcoin today. Bitcoin is also risky. All of crypto is risky, as is DeFi. You could lose what you put in, but we are headed west. This is the frontier. It's not for everybody, but we're glad you're with us on the Bankless journey. Thanks a lot.