ROLLUP: Elon Musk Buys Twitter?! | 8.5% Inflation | Tax Week | Epic Games Building the Metaverse

2nd Week of April, 2022 ------ 📣 CONSENSYS | M·A·C: NFT Collection for a Good Cause https://bankless.cc/MAC ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/ 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ ------ BANKLESS SPONSOR TOOLS: ⚖️ ARBITRUM | SCALED ETHEREUM https://bankless.cc/Arbitrum ❎ ACROSS | BRIDGE TO LAYER 2 https://bankless.cc/Across 🏦 ALTO IRA | TAX-FREE CRYPTO https://bankless.cc/AltoIRA 👻 AAVE V3 | LEND & BORROW CRYPTO https://bankless.cc/aave ⚡️ MAKER DAO | THE DAI STABLECOIN https://bankless.cc/MakerDAO 🦁 BRAVE | THE BROWSER NATIVE WALLET https://bankless.cc/Brave ------ Topics Covered: 0:00 Intro 5:00 MARKETS 5:05 BTC Price 5:47 ETH Price 6:35 Ratios, BED, Gas https://www.indexcoop.com/bed 10:55 Total Crypto Market Cap https://www.coingecko.com/en/global_charts 12:00 ETH Min Gas Price Post-Merge https://twitter.com/domothy/status/1512817907130114059 16:00 ICHI Token https://www.theblockcrypto.com/post/141788/ichi-token-price-collapses-by-99-in-latest-defi-debacle 20:42 White House: Extraordinarily Elevated Inflation https://twitter.com/disclosetv/status/1513574076383645699 https://www.reddit.com/r/Superstonk/comments/u1xynt/the_annual_inflation_rate_in_the_us_accelerated https://twitter.com/TrustlessState/status/1514569232306118659 26:00 Bloomberg Merge Estimates https://twitter.com/RyanSAdams/status/1513892957371437074 34:10 RELEASES 34:40 Robinhood Crypto Wallet Transfers https://www.theblockcrypto.com/post/141008/robinhood-widens-user-access-for-crypto-wallet-transfers-unveils-plan-to-support-lightning-payments-for-bitcoin 36:53 Polygon KPI Liquidity Mining https://twitter.com/0xPolygon/status/1511373161623089152 38:50 Umbra Now Available on Optimism & Arbitrum https://www.scopelift.co/blog/umbra-launches-on-optimism-and-polygon 39:35 Uniswap Swap Widget https://twitter.com/Uniswap/status/1514603576093335553 41:00 AVAX Mempool Opening Up https://twitter.com/trustlessstate/status/1514013436878983173 44:50 RAISES 44:55 Epic Games $2B to build an Avatar Filled Metaverse https://twitter.com/FT/status/1513575145805336577 45:45 Uniswap Labs Ventures https://twitter.com/Uniswap/status/1513564875037061122 50:00 Circle $400M https://www.prnewswire.com/news-releases/circle-announces-400m-funding-round-301523647.html 50:20 AVAX Labs https://twitter.com/TheBlock__/status/1514615631877836814 52:45 Ignite (formerly Tendermint) Launches $150M Accelerator https://www.theblockcrypto.com/post/141302/ignite-formerly-tendermint-launches-150-million-accelerator-for-web-3-projects?ref=coingecko 53:35 Goldman Sachs Invests $88M in Certik 54:13 Nomad $22M https://blog.nomad.xyz/nomad-raises-22m-seed-round-for-security-first-interoperability-5d6b15c96007?gi=1dbc2b9da21d 54:33 JOBS https://pallet.xyz/list/bankless/jobs 55:34 NEWS 55:40 Merge Won’t Be in June https://twitter.com/timbeiko/status/1514010098145759232 57:50 Maple x Maker https://maplefinance.medium.com/maker-x-maple-a-partnership-to-scale-the-digital-economy-38f6ce0fce1b 58:35 Meta 50% Commission on NFTs https://twitter.com/banklesshq/status/1514333528292536328 1:00:05 The BAYC Brand/Restaurant https://twitter.com/BoredNHngry/status/1513599188243652610 1:02:30 Coinbase Interactive 3-Part Film - BAYC the Movie https://twitter.com/coinbase/status/1513589848048689152 1:03:52 Jack Dorsey NFTs Not Rare? 1:06:23 ETH NFT-Backed Loan Market https://decrypt.co/97190/ethereum-nft-backed-loan-market-heats-up-as-cryptopunks-owner-borrows-8-3m 1:07:13 Elon 1:07:30 Not Joining Twitter Board? https://www.theblockcrypto.com/linked/141437/elon-musk-reverses-decision-to-join-twitters-board https://twitter.com/elonmusk/status/1514564966564651008 1:09:38 Axie Infinity 1:09:45 Hacker Launders 7.5% of Stolen ETH https://twitter.com/watcherguru/status/1512819830927376384 1:15:36 $NEAR Launches April 20th https://twitter.com/Route2FI/status/1512166993671168003 1:15:48 REGULATION 1:15: 50 USDC Stablecoin Issuer Hires Execus to Oversee Regulation 1:16:11 Celsius No More Deposits 1:17:00 Uniswap Labs Being Sued 1:23:11 TAKES 1:23:46 U. S. Taxes https://twitter.com/DanPriceSeattle/status/1513552893688827907 1:24:22 Local or Global DeFi Winners https://twitter.com/RyanSAdams/status/1513865713739608076 https://twitter.com/hildobby_/status/1513874645371559936 1:27:20 Who Could’ve Foreseen This? https://twitter.com/ercwl/status/1513681327354171403 1:29:30 This is Why We Fight https://twitter.com/TrustlessState/status/1514356560516030464 1:36:52 What David’s Excited About 1:39:00 What Ryan’s Excited About 1:41:35 MEME of the Week https://twitter.com/Pollo2x/status/1514335011461218307 https://twitter.com/TheRugNews/status/1514615385806426117 1:42:55 Closing & Disclaimers 1:43:08 Moment of Zen https://twitter.com/songadaymann/status/1512141935959494656 ----- Not financial or tax advice. See our investment disclosures here: https://newsletter.banklesshq.com/p/bankless-disclosures

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

• 0:00David Hoffman?

  A question for you, Ryan, just like just gut take. How do you feel about the market? Just general sentiment? No charts, no numbers. General sentiment.

• 0:09Ryan Sean Adams?

  Can I be honest for a minute?

• 0:10David Hoffman?

  Sure.

• 0:11Ryan Sean Adams?

  I'm feeling real good about the market.

• 0:13David Hoffman?

  Yeah.

• 0:17Ryan Sean Adams?

  Hey, Bankless Nation, happy second week of April. We got a hot week for you. Really excited about what we're doing today. And David, what is this episode called? Tell them.

• 0:25David Hoffman?

  Oh, Ryan, it's the Friday Bankless Weekly Roll Up, where we recap the entire week in crypto, which, like I say, Ryan, is always an ambitious endeavor, yet we persevere nonetheless through the gamut of the news. We pack it apart, we pull it apart, we distill it for you, digest it for you, and download the entire week of crypto, all in one episode.

• 0:45Ryan Sean Adams?

  Some nice digestion for you, some pre-chewed meat for you.

• 0:51Ryan Sean Adams?

  Am I being gross? Hey, look, welcome to the East Coast. That was a subject change. How's the East Coast time zone for you? Enjoying this?

• 0:58David Hoffman?

  It's been a little bit of a shock. All of my West Coast friends aren't up in the morning, so I want to like get up and start shitposting in Discord, and they're like not awake yet. But then, like, you know, we get to start the weekly roll up a lot earlier. This is the earliest weekly roll up you've ever done, Ryan.

• 1:14Ryan Sean Adams?

  Yeah, it is. Yeah, I can't believe this is like the crack of dawn, I guess, in comparison. But I love being on the East Coast, because I feel like we get a jump start on all of the West Coasters. Right? So by the time you've woken up, I'm like, I'm already in work mode. And I'm like, just, although you do wake up really early, so you're pretty close. But like, it's nice. You get kind of a jump start on the day.

• 1:39David Hoffman?

  Yeah. What I've noticed about Brooklyn is like coffee shops don't open until like 7:30 or 8. And so I go out in the morning and like I'm waiting for the coffee store to open. This is ridiculous.

• 1:51Ryan Sean Adams?

  Yeah, I'm not sure why that's going on. But anyway, guys, we've got a hot week for you on the recap. We're gonna get it back to crypto. Topics of the week. First of all, inflation, 8.5% WTF. This is the highest like in 40 years or something, David? And when it's reported at 8.5%, you know it's a little higher than that, right? Oh, yeah. You know, it's double digits already. We're gonna talk about that. Also, Elon Musk. Last week, we told you he was gonna be on Twitter's board. This week, no, he's not, apparently. But now he wants to buy all of Twitter. The whole thing. Okay, well, talk about that. Also, the merge, the Ethereum merge, sad face, not happening in June. So we're gonna talk about that. Some people are calling this a delay. I think we have a different take on this. Also, Zuckerberg's Metaverse. You know, he's working on this Metaverse thing, renamed his company.

• 2:38Ryan Sean Adams?

  You will be shocked at what markup he is charging on NFTs. No, I don't think I will, Ryan. I think I won't be shocked at all. Well, yes, probably listeners will not be shocked, but it is surprising, I will say. It's a high number. Also, tax memes, okay, just to make you feel good. Look, yeah, I know, because this is coming out on the 15th and like taxes are due either today or the 18th. I can't remember. So we want to just make you feel good about the pain that you just suffered compiling your crypto taxes. So we got some memes in store for you. We're gonna get right to it. Before we do, though, guys, we should talk about the thing that we said would happen,

• 3:19Ryan Sean Adams?

  which is these Keith Haring NFTs. You know, it was National HIV/AIDS Awareness Week, and MAC and Consensus NFT partnered up to issue these fantastic NFTs. A whole bunch of them are sold. They're sold already, David. I managed to snag this red one. There might still be some red ones left. I'm not sure. And the experience of buying it. Yeah. Okay, so the experience of buying it was really cool. So all I had to do, this is it, in my OpenSea wallet, one of my OpenSea wallets, all I had to do was put it in my credit card. So no transaction fees. I didn't even have to spend fiat on this, or excuse me, ETH on this. I could spend fiat, right? So you didn't even have a taxable event? Yes, exactly. Now you're thinking like me. I got him.

• 4:04David Hoffman?

  This is the only time of year I'm gonna be into these like tax memes.

• 4:08Ryan Sean Adams?

  That's the second thing you've said to me today that I'm like, god damn, David is tax savvy now. Anyway, so you pay with fiat and there's no transaction fees. It's issued on Polygon. They send you an email, you click it, you get it minted and you're all set. So pretty cool. And of course, as we reminded you the last week, 100% of the proceeds, even resale value, goes to support youth affected by HIV and AIDS. So you want to check this out.

• 4:36David Hoffman?

  Yeah, there's 5,000 total red NFTs left. They are the comment tier, if you will. But you'll notice that they're going for $25 each with your credit card, but the floor price is $82. And so as soon as those sell out, you know, that's, you know, what happens next? I don't know. I don't know.

• 4:54Ryan Sean Adams?

  NFTs for charity, but maybe also some alpha? Kind of cool. Let's talk about markets though, David. Let's see. Oh, by the way, link in the show notes to that if you want the easy button. Markets though, Bitcoin price, we up, we down, we sideways?

• 5:08David Hoffman?

  We're down, we're down, Ryan. We started the week at $43,000, $43,500. We fell down to a low of $39.5,000, so broke through that $40,000 number, which is a good number to not break through, but we are back above it. We are back above it at where we are now at basically $40,100. Defending that $40,000 number, if we could keep on defending that pretty well, that'd be nice. You know, dangerously close to below $40,000.

• 5:36Ryan Sean Adams?

  It's an interesting week to look at crypto prices, right? Because we're going to get to it. The 8.5% inflation we were talking about, that happened this week. And so it's been interesting to see how Bitcoin and Ether and other crypto assets respond to this. But how about ETH? How has it responded to some of this news? And I think the news came out like... Was it Monday-ish?

• 5:53David Hoffman?

  Yeah.

• 5:53Ryan Sean Adams?

  About inflation worries, Monday, Tuesday?

• 5:56David Hoffman?

  Tuesday, I think, something like that, yeah.

• 5:57Ryan Sean Adams?

  You can see down, we're down, but what's ETH for the week?

• 6:00David Hoffman?

  ETH is down 2.5% this week. Bitcoin was down, is down 5%, ETH is down 2.5%. I wrote these numbers in, they actually might be down a little bit more than that. So it might be something like 5.5 and 3% Bitcoin and ETH. ETH started the week at $3,200, hit a low just below $3,000. Just like Bitcoin is defending 40,000, Ether is defending 3,000. We are currently at $3,020, keeping our head right above water. Not terribly comfortable, but defended nonetheless.

• 6:31Ryan Sean Adams?

  It's a good day for above 3K. I'm gonna say it every time, David. Uh, ETH Bitcoin ratio, what's the ratio looking like?

• 6:37David Hoffman?

  Yeah, ETH Bitcoin ratio up 2.5%. Yeah, so we are at .0555, or excuse me, what did I have to say? .07555. Um, okay, up 2.5%. I'm not like, you know, bold market appetite still on the table.

• 6:52Ryan Sean Adams?

  Yeah, it's definitely on the table. I'm gonna, I'm gonna look at the six month here. What are we looking at in the six month?

• 6:58David Hoffman?

  Uh, go to the, go to the one year, go to the one year, not the year to date, because it's still so early. Go to the one year. Yeah, like, you know, you know, like, we're trending higher, trending higher. We're cool with it.

• 7:07Ryan Sean Adams?

  Interesting. All right. So the, the market's not saying bear territory right now. The market's kind of undecided, which is super interesting. How about, uh?

• 7:15David Hoffman?

  Question for you, Ryan, just like, just gut take. How do you feel about the market? Just general sentiment. No, no charts, no numbers, general sentiment.

• 7:24Ryan Sean Adams?

  Can I be honest for a minute?

• 7:25David Hoffman?

  Sure.

• 7:27Ryan Sean Adams?

  I'm feeling real good about the market.

• 7:28David Hoffman?

  Yeah.

• 7:29Ryan Sean Adams?

  I am. I'm feeling really like, maybe like, maybe I'm too bullish. And that, that, that worries me a little bit, like the fact that, the fact that inflation and kind of these, you know, these Fed shocks, right? Like, the news has sunk in. I mean, the Fed is gonna take some pretty drastic action here in the coming months. They're going to have to, raising rates, they're gonna start selling their bonds. We got into a whole episode, uh, with us about crypto with, um, with Dan Moorhead, where we talk about this. That episode is coming out, not next Monday, but the Monday after.

• 8:02David Hoffman?

  Right, because Vitalik's coming out next Monday, so, you know.

• 8:05Ryan Sean Adams?

  Yeah, yeah, you know, Vitalik gets the spot first. But, uh, the, the episode with Dan was fantastic as well. Anyway, um, I think that I would have, with... Crane, with all of the macro things happening this year, I would have expected it to tank hard. And it's not. It's actually becoming a little less correlated with the stock market, right? So, look, there could be some other shocks in store for us this year, right? You know, a big, a big hit on some event, something could happen with the stock market and the bottom falls out of that. Who knows? I think it will take crypto down with it, but I think our recovery might be stronger and faster. And it's not certain that all of those things will happen either. So I'm feeling pretty good about it. And I don't

• 8:50Ryan Sean Adams?

  know if I trust my, my instinct or feeling on that. But like, look, don't listen to me. I just, I'm a, I'm a long-term holder about these things. So I get less worried about what happens in the week to week and the month to month. What's your take?

• 9:01David Hoffman?

  Yeah, I would agree. Like, the longer post, you know, the market has definitely internalized and accepted the Fed's actions, from, from what I've gathered. Like, we've had, like, basically the whole entire year to come to terms with the Fed is going to raise interest rates and offload their balance sheet. And so even like, and the news this week was that, like, oh, inflation was even hotter. The Fed was, is going to even more aggressively offload their balance sheet. And so we went from like, where we were at, like, 3,500 down to 3,000, more or less, or something like that, in the last two weeks. And so like, you know, if that's what it's going to be when we find out that it's going to be even faster than it is, then, yeah, fine. Like, we'll take it.

• 9:42Ryan Sean Adams?

  Is that all you got?

• 9:43David Hoffman?

  Yeah, like, I'll, I'll take a gut punch of 3,500 down to 3,000. Like, if, if this is how we are reacting to an acceleration of the bearishness, then like, that's fine. Like, 3,000 is, is cool.

• 9:56Ryan Sean Adams?

  Because here's the, here's the other thing. Macro is the only thing holding crypto down at the moment. I firmly believe that, right? That's why we are kind of in this crap territory. If everything was going swimmingly from a macro perspective, I think we would be hitting higher highs over all-time highs right now.

• 10:16David Hoffman?

  Yeah, I definitely agree with that for sure.

• 10:20David Hoffman?

  Actually, it's the episode that we did with Dan Moorhead is just really timely because Dan Moorhead was a macro investor before he became a crypto investor. And he realized in 2013 how macro of a conversation crypto is going to be. So he pivoted Pantera from a macro fund to a crypto fund. The timing for that episode couldn't be better. And so, but we got to put out Vitalik first, but if for those who subscribe to the premium feed, who are paid subscribers of Bankless, you'll get that early access earlier in the week.

• 10:45Ryan Sean Adams?

  Yeah, let's see if we can do that earlier, like earlier in the week next week.

• 10:49David Hoffman?

  Monday, Tuesday, Wednesday. Yeah.

• 10:50Ryan Sean Adams?

  Thank you, Bankless editors. Well, let's take a look at the cryptocurrency global chart. We don't usually do this, but I think we should start doing it from now on, David. So what is the crypto market cap total this week?

• 11:01David Hoffman?

  Yeah, yeah, we started the week at 2.08 trillion and we are currently at 1.96 trillion. So quick math, we lost a little bit over point one trillion dollars. Yeah. A little over 100 billion.

• 11:17Ryan Sean Adams?

  Was that a quarter of an Elon? We lost one quarter of an Elon.

• 11:21David Hoffman?

  My God. Oh, that is a quarter. He's so rich.

• 11:25Ryan Sean Adams?

  Am I right?

• 11:25David Hoffman?

  Oh, my God.

• 11:26Ryan Sean Adams?

  I think it's close. I don't know.

• 11:27David Hoffman?

  I think it's pretty close. I wrote down these numbers right before, like we lost another like 1% in the market. So I think the markets are down, the total crypto market cap is down a little bit over 4%. Writing down how fast these markets move, like the numbers get inaccurate from when I write them down 40 minutes ago to where they are now.

• 11:44Ryan Sean Adams?

  Should we start like talking about these in terms of how many Elons we lost?

• 11:50David Hoffman?

  Well, the US dollar is becoming a terrible frame of reference. So we might as well.

• 11:56Ryan Sean Adams?

  Elon, come on the show, though, seriously. Anyway, ETH gas, that's gone down a little bit this week. Am I right about that?

• 12:02David Hoffman?

  Yeah, last week, the average gas price was 45 gray. We are down to 38 gray. Again, always correlated with prices. Prices go up, gas goes up. Prices go down, gas goes down.

• 12:12Ryan Sean Adams?

  Price at the pump going down. Well, let's talk about what that means. Here's, here's some market insight from Dom. Have you ever thought about what gas price would make ETH actually deflationary in a post-merge world? I hope you understood what I just said there in the post-merge because David and I have been talking about it for so long. If you don't, go check out a YouTube, a video that we released on kind of what the merge is. But anyway, Dom says. There is an easy way to calculate when, at what gas price ETH is deflationary. And to do that, you take the number of active validators in the beacon chain. You calculate the square root, multiply that by a number, 0.0239.

• 12:57Ryan Sean Adams?

  Those don't matter. What's really interesting is these numbers right here, which is depending on the number of validators you have, the more validators you have, I guess, the like the higher gas fees need to be to make it deflationary. But they're all still super low. And I think we're at about 3,600 validators on the beacon chain.

• 13:17David Hoffman?

  360,000 validators.

• 13:19Ryan Sean Adams?

  Oh, 360,000 validators, excuse me.

• 13:21David Hoffman?

  And then 13,000 validators more are coming in the queue as well.

• 13:24Ryan Sean Adams?

  Which means about any time gas fees are, yeah, 14, 15 GUE. Above 14 or 15 GUE, we're burning ETH.

• 13:37David Hoffman?

  In post-merch, in post-merch, not in current state.

• 13:40Ryan Sean Adams?

  Merch world, not current state. So that means anytime gas fees are above 15 GUE, we're burning. If they're ever below 15 GUE, then we're not burning ETH in a post-merch world. But my God, they're always going to be above 15 GUE, aren't they?

• 13:54David Hoffman?

  Yeah, for sure. And according to the Ethereum researchers, they all feel comfortable with about 20 to 30 million Ether staked for maximum Ethereum security. And it's like final form, like 30 million ETH stakes. It's going to be really nice when we have a very large layer two ecosystem because they're all going to need that security.

• 14:12Ryan Sean Adams?

  So like 20% ish of all ETH supply.

• 14:15David Hoffman?

  Yeah, exactly. Like 30, 30 million ETH is going to be about what you see on the screen at 1 million validators, right? Like 1 million validators times 32, 3, like 3.2 million ethers or, yeah, 3.2 million Ether staked. No, 32 million Ether stakes, excuse me, which is like 25 ish percent of all Ether. And so, and as for, just for people that don't know, the more Ether that is staked to the proof of stake network, the Ethereum protocol issues a little bit more in total. Aggregate yield goes down because that, that what is issued gets spread out by more people. But the Ethereum protocol ramps up a little bit, the total amount of issuance, just to have a balance, just to have an equilibrium.

• 14:53David Hoffman?

  So at maturity, what this means is that we're looking about 24 GUE, perhaps for that threshold for in the long-term equilibrium of Ethereum. 24 GUE is the burn ratio over the long-term. It's always gonna be over 24 away.

• 15:07Ryan Sean Adams?

  We're gonna be burning.

• 15:08David Hoffman?

  We're gonna be burning all the time.

• 15:09Ryan Sean Adams?

  Sometimes we're gonna be burning massive amounts because we predict that gas fees on Ethereum mainchain to go up and up and up and up. Because we are on this progress of first, gas is being consumed by users, then gas starts getting consumed more by smart contracts. Eventually, gas will be entirely consumed. Ethereum block space will be consumed by layer twos. As the model here, we won't actually have users, individuals like you and I, on the Ethereum mainchain unless we're like super whales. We'll be doing our stuff on layer two and posting, the layer twos will be posting, purchasing gas from Ethereum. So, gas fees are just gonna go up. So, always gonna be burning in the future.

• 15:49David Hoffman?

  Even the Ethereum whales probably won't be on the Ethereum L1 because all the utility is gonna be on the layer twos.

• 15:55Ryan Sean Adams?

  Totally, totally, exactly. We're gonna be moving to Brooklyn, way from Manhattan. Right, David?

• 16:00David Hoffman?

  Nice, nice.

• 16:02Ryan Sean Adams?

  Okay, ICHI token. There's an ICHI token collapse. Like, I don't know why we're talking about this other than it's just a big, like, 99% DeFi debacle. Maybe there's some lessons here. What are the lessons here? It went from 650 million market cap to 10 million in 12 hours? That's pretty painful. What happened?

• 16:20David Hoffman?

  Yeah, over half a billion dollars just got deleted in 12 hours. So, this was a brand-new token that was coming out, which was going to help produce a bunch of new stablecoins, kind of just like, kind of democratizing the ability to produce new stablecoins. And what happened is that there was a Rari Fuse Pool, Fuse Pool number 136, that was made for the ICHI token. And the ICHI token, the team that was managing this Rari Fuse Pool, because as this Ichy token was like mooning, basically, it went from like 0 to 600 million plus a market cap in like a month or so, maybe a little bit less.

• 16:59David Hoffman?

  Since since March, so yeah, yeah, about a month, actually. Very strong price action up until the time it went to zero. But basically, OK, the the team with the Rari fuse pool. They made a fuse pool so they could borrow against the Ichii token, kind of like being able to use it in Compound, right? But for fuse. But Compound doesn't allow you to do this because of risks. And this is going to be a great example as to why Compound doesn't allow any asset to come on to its collateral. They increased the loan to value limit on the Ichii fuse pool to 85%. So if you put in $1 million worth of Ichii token, you could get $850,000 in stable coins back, which is a very large loan to loan to value ratio, which is largely reserved for only the most liquid of assets. Bitcoin and Ether, basically, that's it.

• 17:43David Hoffman?

  And even with Ether, I'd say 85% is still a large amount, even with Bitcoin, kind of reserved only for stables, really, if you want to be hyper secure. But this very illiquid, very brand new token that has just recently had a very large run up in price was given an 85% loan to value ratio. So some users were making significant loans and allowing them to borrow stables, buy Ichii tokens, put Ichii tokens in the fuse pool to buy more stables, basically leveraging up on Ichii tokens. And so there was a ton of leverage of Ichii tokens with outstanding US dollars being borrowed. And it's really important to note that just because you are leveraging up on Ichii tokens doesn't mean that there's significant amount of liquidity there. So there's very little ability for if there a a sell event were to happen

• 18:28David Hoffman?

  for that price to stay stable. There's no liquidity on the Ichii tokens. And so as soon as there was a blip in the downwards price movement of the Ichii tokens, a a massive cascading liquidation happened. And so as soon as the price of Ichii moved by 15% from the highs, the protocol liquidated basically every single Ichii token that it had in its its results, which is why how it went to zero, right? There was not enough liquidity to repay the pools. And so the Ichii token went down to to zero. And so like this, there's a lesson here. There's a lesson in don't take too much collateral, or don't take too much leverage, especially on an illiquid, brand-new token with very little price discovery.

• 19:09David Hoffman?

  But also, in theory, this itchy token, this democratization of the ability to mint stablecoins, that's a viable product. That could have worked just fine. But what happened was that there was a very irresponsible team and a de-GEN community that caused the token price to implode, causing the project to implode. So on one hand, we have this viable project. And then on the other hand, we have these irresponsible team and de-GEN traders that blew up the project. And so my lesson, I love this lesson, the lesson here is culture matters, Ryan. If you have fundamentals of a project, and the fundamentals of the project are strong, but you have an irresponsible team and a de-GEN community, it'll wreck the project. Culture matters. And that is my takeaway.

• 19:54Ryan Sean Adams?

  Look, man, they basically burnt down their own house. And what's interesting about Fuse is different than Compound. Fuse is really a power tool. There is no risk to the Fuse protocol for these shenanigans. I'm stealing that word now. Because it isolates the risk to individual pools. So any community can spin up their own pool with whatever risk parameters they want. And this community just created this extreme, over-leveraged, terrible pool. And this is the outcome. And it probably destroyed the project. It's trading a little bit higher now, but this is definitely shaking the faith. So Fuse is a power tool. Be very careful how you use it.

• 20:37Ryan Sean Adams?

  Yeah, definitely. It's just like shop class again. All right, let's get to inflation. That's a big story this week. So we said 8.5% inflation. This is the White House. This is a spokesperson for the White House calling extraordinary inflation extraordinarily elevated. Extraordinarily elevated. That was hitting headlines this week. I guess a few stats for us. So inflation apparently was a 40-year high. This is a 40-year high, so we haven't seen this since, I guess, 1981. This is after a decade of inflation in the seventies. It's kind of the high watermark.

• 21:15Ryan Sean Adams?

  And the, really the energy and food costs are spiking up. They're hitting consumers the most. It's likely that the Fed is going to meet in three weeks' time. They're going to increase rates, interest rates, by probably about 50 basis points, so half a percent.

• 21:34Ryan Sean Adams?

  It's absolutely crazy what's going on. Like, these are some of the, these are some of the inflation stats individually. Gasoline, gas is not, not Eve gas. Regular gas is up 48%. Used cars up 35%. Meat, fish, eggs up 13%.

• 21:51David Hoffman?

  Read, read protein, because that's like meat, fish and eggs, that's protein. So like, you know, good quality food, yeah.

• 21:58Ryan Sean Adams?

  Yeah, absolutely. Food at home is up 10%. Like, I don't know, man. Went to Costco this week and our grocery bill has never been higher. That is all time highs. Yeah, absolutely. And it's, I think everyone's feeling this. Like, everyone is noticing. It's very visible. I mean, you're not like 2 to 3% inflation per year. You don't barely notice, right?

• 22:19David Hoffman?

  Right.

• 22:19Ryan Sean Adams?

  8.5%, then it's like on a monthly basis, you're just like, wow. Everything is spiking in price.

• 22:26David Hoffman?

  Right. Who could have seen this coming? Gosh, I don't know.

• 22:31Ryan Sean Adams?

  I mean, they used to call it transitory inflation. That was last summer and we were kind of making fun of that. But look, look at this. Look at this chart, David. This is, um, this is kind of a data's beautiful sort of thing where you can kind of see rates from 1995 on. And we've just had decades, literally, of low inflation, you know?

• 22:50David Hoffman?

  1.4 is the lowest number that I see. The highest number that I see is four. Wow, in 2009, it was inverse. The dollar was deflationary. 2009, I see a negative 2.4% inflation rate. Wow.

• 23:03Ryan Sean Adams?

  Yep, you're not seeing, like, 2008 was kind of a tricky year, of course.

• 23:07David Hoffman?

  Well, that makes sense because that's right before the housing bubble. That was the peak of the housing bubble when there was so much capital flowing around. So that actually makes sense. And then we, and then we retraced it, right? Like, oh, the how, like 5% inflation rate happened too much and then, and then the housing bubble crashed and we, and we re-corrected that.

• 23:22Ryan Sean Adams?

  Healthy-ish, at least CPI. No, asset price inflation, different story. Not healthy, but like healthy, healthy, healthy. Now look at this.

• 23:29David Hoffman?

  Bam.

• 23:30Ryan Sean Adams?

  Right? Like 6.2%.

• 23:31David Hoffman?

  Wow.

• 23:32Ryan Sean Adams?

  Bam. 7.5%.

• 23:34David Hoffman?

  And you see it in April of... April of 2021 is when you really start to see it and it starts to really change the parameters, which is makes sense because that is the first summer post-COVID, when people decided that they were done and they were getting out and getting to enjoy their lives again. It was all, this is all COVID, man.

• 23:51Ryan Sean Adams?

  Yeah, totally.

• 23:52David Hoffman?

  Wow, that 8.5 number is a dark square. Oh, man. So there's many, many more unfilled months for the remainder of 2022. And that's really gonna be the story. It's like, how dark are those squares going to get? Or are they going to return to normalcy? Um, that is the, I think, the, the big story of the remainder of 2022. How bad will inflation get?

• 24:11Ryan Sean Adams?

  I think we're headed to double digits. Uh, you had a take here. What was your take on this?

• 24:16David Hoffman?

  Yeah, uh, my take was inflation and distrust in government are highly correlated. When they break our money, they break our faith. Uh, and this is why in the crypto industry, we like to talk about the separation between government and money, the separation between money and state. Uh, because the government is responsible for the money and because money works because we all believe in it, when our faith in the money breaks, our faith in government also breaks. These are the same size of two different coins. No, the same, two different sides of the same coin. Thank you.

• 24:46Ryan Sean Adams?

  Yeah, yeah, absolutely. And I think that, um, inflation is the thing that everyone notices. I, I would argue that, um, markets have been broken for a while. Just the last like 15 years, asset price inflation's been absolutely insane. But now everyone's noticing it because everyone pays for things denominated in dollars. And now that's going off, uh, the rails. And it's not clear that the Fed has a plan that's workable to, to correct this. Like, it's kind of, you know, we use that term, Powell's just, it's the Jesus take the wheel approach. I don't think they know what they're doing. I mean, uh, a year ago, less than a year ago, they were calling all of this transitory. Does this look very transitory to you?

• 25:29Ryan Sean Adams?

  We have a, we have a clear escalation in inflation rates. It's getting worse, not better. And how do you dial this down? They're barely taking action. Right now, and it's unclear that they'll be able to get this genie back in the bottle. So TBD on that.

• 25:46David Hoffman?

  It's hard to see inflation getting worse than 8.5%, but also, what do I know? I was born in the 90s. I don't know anything.

• 25:52Ryan Sean Adams?

  Well, yeah, it did get worse and it can get worse. And what's what's different than the 1970s is that the Fed has a far more like the balance sheet is far more leveraged. I mean, they weren't like buying bonds in in the 1970s and they have been. There's a massive amount of bonds on the balance sheet. So and our debt is higher than ever. Anyway, again, Dan Moorhead episode. If you want to hear more about this.

• 26:16David Hoffman?

  Yeah, the reason why Ryan just skipped to the 70s was because that's what we talked about in Dan Moorhead.

• 26:20Ryan Sean Adams?

  So let's contrast that. All right. We've called Ether, Ethereum, Ether, the asset, an internet bond before. And we think that this is especially true. Of course, we're staking out in a post-merge environment. You know, Bloomberg has been really increasing their coverage on Ether as an asset and getting increasingly bullish on it. They have a few analysts over there that are doing this. This is a Bloomberg estimate. Bloomberg is estimating post-merge a 9% ETH staking yield and a negative 2% issuance reduction annually. They're actually estimating Ether's yield as an internet bond and its supply.

• 27:03Ryan Sean Adams?

  This is the type of stuff that we were hoping financial analysts would start to do on Wall Street. That only like crypto people were doing, only like, you know, guests on the Bankless Show and the Bankless Newsletter were doing. And now we have Bloomberg doing it, not just Bankless. These estimates are pretty good. I mean, it's based on some stuff. They've done their they've done their research. They've done their due diligence. I'm not sure if it's going to be like 9%. I actually would err on on something higher than 9%. Yeah, and it's probably like with MEV and such, you're probably like maybe 12 to 15% is what I would say. This 2% issuance reduction sounds about right, but it's just so cool to see Bloomberg covering this. And also contrast that with what's going on in the yield markets.

• 27:48David Hoffman?

  It's so beautiful.

• 27:49Ryan Sean Adams?

  You are making like, if you buy a Treasury, a government bond right now in real terms, how much are you losing per year? Like 2%, 3% losing per year. What a contrast in buying Ether as like an internet bond versus the sovereign bonds that you can get in fiat economies.

• 28:08David Hoffman?

  Dude, I mean, think of what it like how magical this must look like and honestly, why people probably look at this with skepticism. How can there be a net issuance reduction of 2%, negative 2% deflation in the monetary supply rather than inflation of the monetary supply and investors be getting yield? That has to just boggle people's brains until they understand the relationship between block space, block space sales, EIP 1559, all that stuff. Okay, so on one hand, you have a currency that is inflating in supply. So your real terms are going down and the yield that you get on the, in the bond market is because of treasuries and issuance from the United States government is less than the actual real terms of value.

• 28:52David Hoffman?

  So you have inflating supply of the currency base and the yield for your bonds is less than the actual inflation. On the other side of things, you have a deflating currency base, but the yield that you're getting on that deflating currency is higher than the yield that you would get in the bonds.

• 29:11Ryan Sean Adams?

  I know, man.

• 29:12David Hoffman?

  It's insane.

• 29:13Ryan Sean Adams?

  It's also, look, the narrative is too good here too, right? It's just forget digital gold. Like, we're going after the bond market, the sovereign bond market, right? Not $8 trillion in market cap. It's like 50 to 70 trillion dollars in market cap.

• 29:30David Hoffman?

  Peter Thiel, when he was talking at the Bitcoin conference, he'd made the comparison between Bitcoin and Ethereum and he compared Ethereum to Visa. And he's like, all right, well, here's Visa's market cap as a payments network, but then Bitcoin is going after the much larger market cap of gold. And like gold has got a $7 trillion market cap and Visa is only like, I don't know, half of, half of, I don't know, whatever Visa is. And I'm just watching Peter Thiel talk about how comparing Ethereum to Visa. I'm like, bro, we aren't, you guys are taking the smaller market cap of going after gold. We're going after the bond market, bro.

• 30:05Ryan Sean Adams?

  I don't even understand, like, I didn't even understand, like, Ether is just as much a non-sovereign store of value as Bitcoin is at this point. And to compare it in that way just feels like you're living back in 20 2017, whatever. Look at this chart, man. Fiat issuance 12%, right? And then we have Ethereum over here post-merge at a negative 2%, negative 2.2%. So it's almost like Apple's stock buybacks, right?

• 30:33David Hoffman?

  Right.

• 30:33Ryan Sean Adams?

  It was like Apple stock, you get a negative 3% to 4% issuance rate in kind of buybacks. That's essentially what you're getting with Ethereum. Anyway, I don't think the bond market's gonna know what hits it. Once this narrative comes out, okay? It's just like, realize, it's just come from kind of the Ethereum community. Bankless is very like bottom layer of the tier here, right? So like, we basically, we learn from researchers and we try to

• 31:01David Hoffman?

  Direct from the source.

• 31:02Ryan Sean Adams?

  understand the protocols best we can, we get it direct from the source. And then we bring it a level higher to help more people understand it. But like, mainstream does not tune into Bankless in the way they tune in. But Bloomberg tunes into Bankless. So then Bloomberg gets a hold of it. And then, pretty soon, other analysts take a look at this thing and they're like, what is this? What is happening here?

• 31:22David Hoffman?

  Concentric models, concentric models of information.

• 31:25Ryan Sean Adams?

  This is what's happening. If you're listening to Bankless, the good news is, you're still early. Like, no one knows about this, David. No one knows about this.

• 31:32David Hoffman?

  Right. Even half of the crypto, more than half of the crypto industry is not appreciating this. I'm sure the Bitcoiners, the anti-Ethereum skeptics would love to say like, "But you guys, the merge just got delayed." Okay, fine. More time to stack ETH. That's great.

• 31:47Ryan Sean Adams?

  Yeah, let's talk about that. We'll talk about that coming up. But guys, we want to get to a few more things, some releases first. Before we do all of that, we want to thank the sponsors that made this episode possible.

• 31:57David Hoffman?

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• 32:42David Hoffman?

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• 32:55David Hoffman?

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• 33:38David Hoffman?

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• 34:22David Hoffman?

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• 34:36Ryan Sean Adams?

  Alright guys, the releases of the week. Robinhood, you know them, big fintech platform, a lot of the meme stocks trading there. They just enabled crypto wallet transfers. So on Robinhood, for a long time, you've had the ability to buy crypto assets, right? But Robinhood was always custoding them. And this annoyed us to no end, because that is the antithesis of the bankless vision, which is you should have the option to take sovereignty of your keys if you want to. Robinhood previously had not enabled withdrawals to private keys. Well, now they are. So they are enabling the withdrawal from the Robinhood platform to crypto wallets, which is fantastic. Well done, Robinhood. I think they are also adding some other crypto features.

• 35:19Ryan Sean Adams?

  This is sort of what we've been told, that are even more self-sovereign and bankless in the future too. So I think this is a sign of Robinhood getting on board. What's your take here?

• 35:29David Hoffman?

  Yeah, they say from the article, "The rollout began in September to a select group of users," as reported at the time, "and in December, the company inked a deal with blockchain analytics from Chainalysis to prepare for the offering's wider rollout." So they probably didn't want to, if I'm reading the writing on the wall, they probably didn't want to allow users to have complete self-sovereignty over their being able to take custody of their own funds, because securities regulations is different than crypto asset regulations. And so giving them the ability to freely exit is concerning for them. But that is the way the industry is moving. We have the power to take over our money, so we will. But they've onboarded Chainalysis, like the Eye of Sauron of the government, the tech

• 36:10David Hoffman?

  extension of the government to surveil the incomings and outcomings of going out of Robinhood to help protect them. And so do be aware, if you are using Robinhood, the Chainalysis, which has way better data about blockchain analytics than you do, is watching you. They're probably watching you anyways, so there's that. But this is Robinhood trying to keep up with the rest of the industry and allowing us to do all the things that crypto allows us to do. So thank you, Robinhood, for getting to this point, and I'm looking forward to the further increased innovations that are coming out of you guys.

• 36:43Ryan Sean Adams?

  I think Layer 2 is next. Look, they're adding the Bitcoin Lightning Network, apparently, and I expect other Ethereum Layer 2s will come after that, so very good. Also, Polygon, they're doing some more liquidity mining, just to incent use of their protocol. What's going on here?

• 36:59David Hoffman?

  Yeah, this isn't just like another liquidity mining program. They're actually, I think, really pioneering, innovating, trying to make liquidity mining, get the KPIs that they're really looking for. They actually are literally calling it KPI liquidity mining, first ever KPI liquidity mining 2.0. So rather than just like yielding out, spraying out Matic tokens to incentivize the adoption of protocols, they're doing things that are more surgical, more targeted to make sure that those issuance rewards are actually producing the outcomes that they're looking for, rather than just being like liquidity mined to death, rather than just being farmed and dumped. So there's two parameters that they're really looking for in this 2.0 version of liquidity mining, total value locked and weekly average users.

• 37:44David Hoffman?

  Total value locked really benefits the whales, which is good because you need liquidity, but weekly average users also benefits the small guy, like the little fry, the individuals. And so I like this model. If they can get this right, I think this is a great just like experiment for the industry to understand. Even anon teams can apply for the campaign. Every single month, distribution is manually evaluated, which I think is actually a great just tool, just manual evaluation. It's a little bit harder, but you get a lot more bang for your buck. And applications that have worked harder to get the KPIs out the door, get more and more allocation for the next month, so long as they proved it. Projects get to choose, the individual projects get to choose where they send the funds, of course.

• 38:27David Hoffman?

  And then there's this graph that Ryan's got on screen, which is showing all the eligible applications on Matic, on Polygon, that are receiving distributions, things like Ave Gachi, Stake DAO, and then a bunch of other things that I'm actually not familiar with.

• 38:40Ryan Sean Adams?

  Yeah, this is really cool. So less gamable and the bottom line is more tokens if you are using these Layer 2 protocols. And so be aware of that and get involved. We encourage you to just like use all of these protocols, guys. You gotta get there. What is this? This is Umbra.

• 38:57David Hoffman?

  Oh, yeah.

• 38:58Ryan Sean Adams?

  Is a, this is a privacy payments type of protocol? What's going on?

• 39:02David Hoffman?

  Yeah, privacy payments on both Optimism and Arbitrum. They call them stealth payments. I don't know if that's a technical difference from like privacy payments like Aztec or what stealth payments are, but I would imagine it's net the same. So yeah, privacy payments on Layer 2, coming with Umbra.

• 39:18Ryan Sean Adams?

  That's really cool. Good to see that.

• 39:20David Hoffman?

  Privacy is also expensive because it's computationally expensive, but when you put it on a layer two, it becomes a lot more viable.

• 39:26Ryan Sean Adams?

  Right, which we need, man. So the I've sworn can't invade everywhere. We still are able to preserve our privacy as we are in the physical world. Uniswap Labs, they just announced and they just launched, excuse me, a swap widget. This looks really cool. What is this?

• 39:42David Hoffman?

  Yeah, so as we know, the front ends for for applications are centralized, especially like you app.uniswap.finance or whatever, whatever it is. I don't know, it auto loads into my browser. That's the Uniswap Labs operated front end. That's the thing that like, you know, restricts based off certain geolocations. They're building a widget to put different Uniswap Labs front ends wherever they there needs to be exchanges. So maybe it's like an iframe if I'm remembering my web dev history correctly, but like you can basically inject a Uniswap.

• 40:14Ryan Sean Adams?

  Add it to your website.

• 40:15David Hoffman?

  Add it to your website, like, yeah, like it just click, click button, deploy, allow for your tokens, right? So I don't know, maybe you have like a token gated website and somebody comes to your website and wants to access your whatever's behind your token gate, but they don't have your token. You could just put your Uniswap widget on your website so that people can get your token.

• 40:31Ryan Sean Adams?

  It's basically like you have to have 10 tokens to become a member, you know, you embed the Uniswap widget, click here, bam, you're you're a member, right? Because you're just buying on Uniswap.

• 40:41David Hoffman?

  Or any use case or any that needs a swap, right? Like, so like, oh, I gotta go do buy the token to do the things. Well, I gotta go load up Uniswap. Well, if you just put the widget into the website, it's easier.

• 40:52Ryan Sean Adams?

  Yeah, it's super cool. It's going to become a pretty pervasive pervasive in all of that liquidity, of course, that Uniswap has bring, you know, bring to bear. Decreases the price on that stuff. So it's cool. Avalanche mempool, what do you want to tell us about this? Are they opening up? What's what's happening?

• 41:07David Hoffman?

  Yeah, so this was something I was actually talking with David Mihal, who runs the crypto, like crypto fees, moneyprinter.info. We use his websites a bunch to display metrics and I was talking to him about how the Avalanche mempool is actually not available for public view. This is something that they have closed and only available to people who stake AVAX tokens, which I I have concerns with because MEV is something that makes the DeFi ecosystem for your chain extremely efficient and extremely solid, right? Very rapid liquidations. It prevents cascading liquidations when there shouldn't have to be having a very.

• 41:43Ryan Sean Adams?

  There might be some people don't even know what that mempool is, though.

• 41:46David Hoffman?

  Oh, yeah. Wow, you're right.

• 41:47Ryan Sean Adams?

  Yeah, what is that? That's like a holding tank area, right?

• 41:50David Hoffman?

  Right.

• 41:50Ryan Sean Adams?

  Where transactions are queued.

• 41:51David Hoffman?

  So, yeah, if you're on Ethereum, the way that I'm familiar with the mempool is like you go submit your transactions, and then you go click the link to EtherScan, and it shows like, oh, your transaction is pending, and it's got the, you've got the loading screen, and then boom, it's confirmed. Before it's confirmed, it's in the mempool. So the mempool stands for memory pool. It's like a memory bank of transactions. And so like, while your transaction is pending and not yet in the blockchain, it's in the mempool. And the mempool is where MEV arbitrators, people that are reordering transactions to benefit themselves, are taking all these transactions and ordering them so they can extract some sort of value, like some arbitrage on Uniswap, or they can get first liquidations. Avalanche does not give that mempool out to the public.

• 42:35David Hoffman?

  It keeps it contained for the Avalanche stakers, because that makes the AVAX token, if you want to access the rewards of MEV, you have to own AVAX, right? It's a little bit reminiscent of order-deal flow from Robinhood to Citadel, which got people very, very upset earlier in the days. And it's always been a very big concern of mine that they don't open up the mempool to the public. The mempool is a public good. It's a public resource. And having a publicly available mempool just makes the whole system very, very strong and anti-fragile.

• 43:04Ryan Sean Adams?

  Because as we saw in the Robinhood case, the ability to order transactions, or process them, you know, in whatever order you wish, is a very powerful feature, especially when you're dealing with large amounts. You know, anything financial, it's a very powerful superpower.

• 43:22David Hoffman?

  Oh, it's arguably the biggest power in DeFi. If you have God mode, basically, over that one block, because you're the validator, you have momentary God mode for that one block. So you can order the transactions as you see fit to best benefit yourselves. Okay, so it's previously, and actually still, the Avalanche mempool is not available to the public. But this Chainsight Labs organization has, they put out a tweet announcing that they are opening up the Avalanche mempool because they are an Avalanche staker. And so on On Avalanche's behalf, they are broadcasting the mempool because they have access to that data. So they tweet out for too long, "MEV on Avalanche has been gate-kept and siloed from the masses due to AVAX not gossiping the mempool."

• 44:05David Hoffman?

  But no longer. Today, we release the web app to Snowsite, an AVAX mempool service. So you can access, finally, the Avalanche mempool at avax.chainsite.dev. And you can now tap into the mempool. And so what should be a public good has actually now been captured by Chainsite because Avalanche hasn't released it. And so now Chainsite is like the broadcaster of the mempool. I mean, in my mind, Avalanche should just open it up anyways. This is the logical conclusion for the Avalanche mempool. But between now and then, Chainsite has complete monopoly over the broadcasting of the Avalanche mempool. But also, thank you to Chainsite for opening that thing up. Again, the mempool is a public good. It should not be privatized.

• 44:47Ryan Sean Adams?

  Absolutely. Let's switch to raises. Epic Games, they just got $2 billion to do what? To build an avatar-filled metaverse. Alright, so the makers of Fortnite now get $2 billion to go create a whole bunch of avatars in whatever the metaverse means to Epic Games, which you know is going to involve NFTs of some form or fashion. That's pretty big news, man. This is like a major gaming studio entering in a big way. What are your thoughts?

• 45:17David Hoffman?

  Yeah, there's also Lego is involved. Yeah, Lego, I guess Lego has kind of always been like a metaverse-esque type of brand. $2 billion in raw funding, that's pretty insane. This kind of feels very similar to the Microsoft acquisition of Activision Blizzard. You know, game companies being acquired by, or just funding and other things of this nature. So like, you know, trad, phi, web 2, trad organizations coming into the metaverse in their own particular way. Okay, alright.

• 45:52Ryan Sean Adams?

  Let's talk about Uniswap Labs Ventures. We're just talking about Uniswap in general, but it looks like they've spun out a VC firm or a VC agency, I guess, and they are going to invest in Web3 organizations, I imagine, Web3 projects. Here's a list of the projects they started with. Tenderly, Layer Zero, Bridge Protocol, MakerDAO, apparently, AVE, Compound Protocol, a whole bunch of others. What do you make of this? Sort of DeFi projects, DeFi protocols now launching their own capital pools as becoming venture capitalists?

• 46:28David Hoffman?

  I think it's a logical conclusion. It's not like they are making a particular strategy or they are doing anything unique. They have capital and if you are somebody who owns capital, you need to put your capital to work for you. And so this is the logical conclusion. This is the theme of this space is like all DAOs have turned into VCs, all DeFi projects have turned into VCs. Like Coinbase Ventures started up forever ago. Coinbase is an exchange, but you know, the industry is so ripe and young and fertile that they should take some of their capital because it's logical to and invest it in things. So any DeFi app with a token that has a significant treasury, you're going to see them turn into VCs.

• 47:08Ryan Sean Adams?

  They're also investing in things that kind of benefit the Uniswap protocol. I would imagine the same way that, you know, FTX and SBF is investing in things that benefit FTX. So I imagine we see more of that. It's interesting. Yeah, I don't know quite how I feel about it, but Spencer Doon has an interesting take about VCs in general and the entire model. He says this, "Protocols are launching funds, Anons are angel investing, DAOs are raising millions per day. Some projects don't even raise private dollars anymore. VC, as we know it, is probably dead by 2030." It's so funny because do you remember when ICOs were going crazy in 2017? That's what people were saying. It's like, oh, the VC model is dead. It's dead.

• 47:51Ryan Sean Adams?

  And the VCs would fight back and they're like, what are you talking about? These ICO tokens are nothing. They're futility tokens. This isn't real. And they proved to be right, but I bet they are not going to be right over the longer time horizon. I think we have a massive disruption force in the typical VC model. We're never going back to like the 1990s and the 2000 era of VCs. I think this crypto is going to completely disrupt what's happening. What are your thoughts?

• 48:20David Hoffman?

  Yeah, just one nuance, and I think Spencer got it right. Like VCs, and you said it too, VCs as we know it. And so you, you talked about how the VCs of the 90s and 20s are dead, and I think the crypto industry has already shifted the overton window of what a VC means.

• 48:35Ryan Sean Adams?

  Totally.

• 48:36David Hoffman?

  What VC is, is changing. But I do think there, the, the one thing that will never, ever go away from whatever you call a VC is always legitimacy and brand and trust, right? Like, that is what a VC is. We, when I did my episode with Haseeb Qureshi from Dragonfly, we dove into these subjects. And he made a very strong case as to why VCs will never go away, because like, you know, the opposite of VCs is retail, right? And so when you say retail, what you're really talking about, what you want to be talking about is just like the average

• 49:10Ryan Sean Adams?

  Hobbyists.

• 49:11David Hoffman?

  Hobbyists who care and have the shared values and legitimacy, but it's hard to target those people. So what VCs do is they like, like centralize and collapse all the legitimacy into one organization and that, and they have their network, right? You're never going to get away from that.

• 49:27Ryan Sean Adams?

  No, there is a need for the function that, that VCs provide. It's sort of like, we're not trying to get rid of banking. There's a need for banking, but we're trying to get rid of banks. Like, that's, that's what's happening. So you still need to lend, borrow and, you know, pay for things. You just don't need the, you know, 150,000 Wells Fargo employees to go help you do those things in the bank branches and physical locations. So, yeah, I think that's what's happening here for sure.

• 49:52David Hoffman?

  Plus, there's plenty of toxic individuals out there, and those toxic individuals definitely don't become part of VC firms.

• 49:59Ryan Sean Adams?

  Right. Circle just announced $400 million funding round, so they're getting funding. I think the big news is it's BlackRock fidelity. Like some really big institutional finance names now coming into Circle. Circle, of course, creators of USDC, the biggest, not the biggest, but the biggest, I guess, most legitimate stablecoin in the US. Also, Avalanche developer just raised $350 million. So Avalanche developer, does this just mean Avalanche, the ecosystem, is raising $350 million? What is this, David?

• 50:31David Hoffman?

  Yeah, that title is certainly odd. This is definitely the Avalanche ecosystem. Ava Labs, the main, ah, okay, here's what they mean. The developer of Avalanche, Ava Labs.

• 50:41Ryan Sean Adams?

  Ah, I see.

• 50:42David Hoffman?

  To say Avalanche.

• 50:43Ryan Sean Adams?

  It's not an individual developer, it's the studio behind it.

• 50:46David Hoffman?

  Yeah, so reported, raised 350 million dollars in a new founding ground valued at 5.25 billion dollars in valuation. The way that that works, because the Avalanche token is actually liquid, right? So what they did is, uh, they probably just like discounted it. So they, wow, the actual, the market cap of Avalanche is 20 billion dollars? Does that mean that they got a 20, a 75% discount on the token?

• 51:10Ryan Sean Adams?

  No, no.

• 51:11David Hoffman?

  That can't mean that.

• 51:11Ryan Sean Adams?

  No, no, no. I mean, there's, so there's the, there's the market cap of the token, right? And then there's Ava Labs, the entity that likely owns a whole bunch of the token on their balance sheet. But it's the develop, this is like, this would be akin to like the Ethereum Foundation getting funded, for example.

• 51:27David Hoffman?

  Because they have a balance sheet of Ether on the table.

• 51:30Ryan Sean Adams?

  Yeah, and because they're producing Ethereum type stuff. It's really interesting. I don't know the structure of Ava Labs, but I imagine it's, you know, it's gotta be a commercial entity, right? It's gotta be like a private entity, which is very different than the EF, which has always been nonprofit. Doesn't, can't get funding like that and plans to dissolve over time.

• 51:47David Hoffman?

  Right.

• 51:48Ryan Sean Adams?

  This is much more, uh, much more commercial, definitely different than the, the vision that Vitalik had. When he had this fork in the road of, do we go nonprofit and become sort of a public good? Or do we go like raise money from VCs and go the Charles Hoskinson route? Uh, that he was advising and he decided to stick with the nonprofit foundation, which is the EF. But many other layer ones are going in the complete opposite direction.

• 52:14David Hoffman?

  Yeah, the cultural difference, I think, couldn't be, couldn't be more clear here. The, the idea of dissolving the, the thing that helped birth Ethereum, rather than making that entity larger over time. Uh, has significant impacts to the ecosystem as a whole. Um, the money that came from this was from Three Arrows Capital and Poly Chain.

• 52:33Ryan Sean Adams?

  Interesting. Some people see this as a strength, others see it as a weakness. It depends what side of the spectrum you're on. I have my own takes, David. I know you do as well.

• 52:42David Hoffman?

  I don't think the listeners need to guess.

• 52:44Ryan Sean Adams?

  Ignite, formerly Tendermint, they just launched a $150 million accelerator for Web3 projects. So this is from the Cosmos ecosystem, really, and Tendermint is being used everywhere. That's the consensus, the consensus platform, structure behind Buna, also behind Matic. Like Tendermint is, is being used in so many different places. So they're just getting funded.

• 53:10David Hoffman?

  I've heard so much praise for the actual technology of Tendermint.

• 53:13Ryan Sean Adams?

  Yeah, it's really cool.

• 53:14David Hoffman?

  People have said that it's been rock solid for years. Yeah.

• 53:17Ryan Sean Adams?

  It's open source and you can take it, use it in their project. It's definitely a net accretion to the industry. Actually, we're getting Ethan, who's one of the original creators of Tendermint, on Bankless to come on, tell us a few things about it and the Cosmos ecosystem. Might be sort of a back and forth debate structure. We'll have to see. Goldman Sachs, they are investing in blockchain security firm, Certik, an $88 million funding round. Certik, are they like auditing, smart contract auditing type stuff?

• 53:46David Hoffman?

  Yes. Yeah. So they, Certik uses from what they claim AI technology to monitor blockchain protocols and provide security audits for smart contracts. So like, I think one part chain analysis, but then also a little bit of just like automated auditing.

• 54:02David Hoffman?

  They also have launched KYC and front end investigation services. So a combo of smart contract auditing, but also chain analysis type stuff as well. Yeah.

• 54:11Ryan Sean Adams?

  Nice. Nomad as well, $22 million, a seed round for security first interoperability. So another bridge type interoperability play. Really cool. All that money going to the space. Speaking of all that money that's pouring into crypto. A lot of job opportunities pouring into crypto as well. We've got a ton of them listed on the Bankless jobs board. This is our time of the week to remind you to get a job in crypto if you already haven't. It's the best place to work. It's fantastic. Uh, let me read out some jobs. I don't know what David's doing. He's leaving his house. I think he's afraid to dance. No, he's doing the background dance. There we go. Jobs, Bankless Newsletter Editor, Number One, Content Manager at Tally, a Director of Developer Relations at Valis, a Solidity Architect at Lu, a Marketing Manager at Misha, a UX Designer at Prometheus Research Labs, a Community Manager

• 54:56Ryan Sean Adams?

  at DGEN Dogs Club. God, that sounds cool. Co-founder for an innovative Omni-Chain DeFi Protocol, TBD, Mystery Project, Blockchain Engineer, Missouri, Software Engineer, Missouri, Operations Manager, Syndica, Senior Product Designer, Smart DeFi, Senior GoRust Engineer, Syndica, Senior Full Stack Engineer, Syndica, Senior Software Engineer, Airdrop Labs. Oh my God, there's so many. Product Manager, Crypto Nori, a Bankless Web Developer at Bankless. Go check them out. Man, that was a lot. David, you come back now. We got through all the jobs. We can move on now. People getting hired in crypto. It's a beautiful thing. You want to get to the news?

• 55:35David Hoffman?

  Here's the sad face news. Should have been expecting it. I get optimistic every single time, but the merge, according to Tim Baker, won't be in June, but will likely be a few months after. Of course, no firm date yet. There never was. You can't call it a delay because there was never a date in the first place. People will call it a delay, though, just because there are expectations. People are like, ooh, June, June, June. And then Tim's like, nope, still not June. And then get kicked out a couple more months. And so, August? August? I'll do it again.

• 56:11Ryan Sean Adams?

  You saying dates because you have to? I mean, there is no date, right? It's gonna happen this year, though, isn't it?

• 56:16David Hoffman?

  2022?

• 56:18Ryan Sean Adams?

  It's gonna happen this year.

• 56:20David Hoffman?

  Right, Tim?

• 56:22Ryan Sean Adams?

  I got the Gandalf meme here. Ethereum devs right now with Gandalf face. The merge is never late. It derives precisely what it means to. I think that's what the devs are like, that's what the devs are communicating. It's like, hey, guys, don't ever say a date again. Okay? Don't. And I feel like, um...

• 56:39Ryan Sean Adams?

  Dates work through social consensus as well is somebody says, "Oh, these things lead me to believe the date is X." It never, it never comes from developers who are saying these dates unless, unless it's like imminent. And then the community rallies around that date and is like, "Yeah, it must be date X." And then someone gets ahold of it and it gets projected out further and further, like, and then everyone's saying June before long. But to be fair, developers never said June in the first place.

• 57:05David Hoffman?

  It's only the social layer.

• 57:07Ryan Sean Adams?

  They do not give dates. Um, but of course, we always like to ask and, uh, I don't know. It feels like, what did Tim say? What are the exact words? Let's parse through this like a Jerome Powell thing. "No firm date yet, but we're definitely in the final chapter. It won't be June, but likely in the few months after." A few months. What's a few to you? Is that three?

• 57:30David Hoffman?

  Yeah, three at best. You probably gotta lean, you gotta, you gotta add. So it's not two, it's gotta be at least three. Four, yeah. October? October. So much time to stack more ETH.

• 57:42Ryan Sean Adams?

  Getting launched on Halloween, guys. Anyway, it is what it is. Keep moving forward. More time to stack ETH. Uh, all right. Maker and Maple, a partnership to scale the digital economy. What is this partnership, David? Two DeFi protocols teaming up.

• 57:56David Hoffman?

  Yeah, this is super simple. The Maker DAO's D3M, the Dye Direct Module allows Maker to mint Dye in specific liquidity pools. Uh, they have this with Ave, so Ave has the power to mint Dye directly as needed. Uh, that is, this ability is now being extended to Maple Finance. Maple Finance is a under-collateralized institution, uh, lending, uh, DeFi app. So, you know, money, like liquidity for institutions, trusted institutions who use their reputation as collateral, uh, and now is being hooked into Maker, so they can go and stray and mint Dye straight from the Maker Protocol.

• 58:30Ryan Sean Adams?

  Nice. Good protocol mashup, good team up. NFT news. Let's start here. Do you know Mark Zuckerberg? He's creating this metaverse thing. He wants to charge people 50% commission on NFTs sold in the metaverse. It was actually like 47 point something percent. And this is basically the kind of the App Store model. You know how Apple charges 30% and everything? It seems like Meta and Mark and the team over there think they can just port this model over to the metaverse and over to NFTs. And I don't know how he can think that. We definitely do not pay 50% commission to an intermediary on the things we use in crypto and NFTs.

• 59:15David Hoffman?

  Granted, we do pay 2% to OpenSea, 2.5%.

• 59:19Ryan Sean Adams?

  Right. So that's, that's something on purchases and that's probably worth it. But can you command a 50% margin? And even OpenSea, you got to anticipate as competition enters, its prices will erode. Because OpenSea doesn't actually own the NFTs, right? It's all like registered on chain. So it's going to erode over time as well. What do you think of this? Do they just not understand the business model of this web three thing?

• 59:43David Hoffman?

  Maybe there's part of the story that like we're not familiar with, but also like maybe just people like, oh yeah, like I'll pay 50% to not get scammed by web three. Maybe that's the take here, but like at the same time, like all this whole like web, web two, doing web three things is going to, as people get more and more comfortable with it, they're going to realize like, why am I paying Mark Zuckerberg such high rent? I'm going to go do it for free in web three. And maybe this is going to be a positive PR move for web three over time, maybe?

• 1:00:10Ryan Sean Adams?

  Yeah, we'll, we'll have to see how that plays out. It just feels like that is so incongruous to. Yeah, egregious. It's just doesn't, it doesn't match. It's a mismatch here.

• 1:00:21David Hoffman?

  50% rent fee on anything is egregious.

• 1:00:23Ryan Sean Adams?

  Yeah, absolutely. I can't believe we still pay 30% in the App Store. This is cool. A Bored Ape Yacht Club restaurant was just launched.

• 1:00:33Ryan Sean Adams?

  You know what's cool about this? So this is the restaurant itself. You know what's cool about this is this guy, I presume, owns the Bored Ape himself, right?

• 1:00:41David Hoffman?

  Sure.

• 1:00:42Ryan Sean Adams?

  And what I was thinking about is the license guarantees to the Bored Ape owners. Basically, they get to profit on use of their ape in whatever they choose. You could put it on a t-shirt and profit that way. You could open up a restaurant and profit that way. You could sell license to it in a movie. So what's cool about this is if kind of an entrepreneur gets use of the NFT that he purchased for some sort of commercial gain. And this is different than the Creative Commons license, right? Because if you have Creative Commons, anyone can do this. Like, your MFers, my MFers, anyone can launch a store, put your MFer in a movie without asking your permission, because that's Creative Commons.

• 1:01:27David Hoffman?

  Please do.

• 1:01:27Ryan Sean Adams?

  But Bored Apes are more restrictive. And they provide the owner of the NFT themselves with the actual license ability and rights. So it's different. It's just, I like how these two experiments are playing out. Like, I have probably preferences, and I think some models will be more successful than others. But you've got to admit that this is kind of a cool use of an NFT.

• 1:01:53David Hoffman?

  Yes, I guess. But also, at the same time, what does the ape have anything to do with a restaurant, right?

• 1:02:00Ryan Sean Adams?

  Oh, I have no idea if the restaurant will be successful.

• 1:02:02David Hoffman?

  As a customer, if you're looking at, like, all right, where do I want to get lunch? I'm hungry for cheeseburgers. Does the ape aspect thing have anything to do with your decision-making?

• 1:02:10Ryan Sean Adams?

  A little bit cringe, actually.

• 1:02:12David Hoffman?

  It doesn't boost the value of the restaurant, though.

• 1:02:15Ryan Sean Adams?

  Yeah, it's probably, this is like, the restaurant itself is maybe sort of a strange pick for this, but like, I don't know. Plush toys, I don't know. Something could hit. I don't know.

• 1:02:24David Hoffman?

  I guess so.

• 1:02:26Ryan Sean Adams?

  Let's talk about this.

• 1:02:27David Hoffman?

  The story does not end here.

• 1:02:29Ryan Sean Adams?

  Yeah, so what's happening?

• 1:02:30David Hoffman?

  Coinbase is creating an interactive three-part film featuring the Bored Ape Yacht Club and ApeCoin communities. So a film about apes and the ape universe with Coinbase called the D-Gen Trilogy.

• 1:02:45David Hoffman?

  Uh, interactive film, maybe that's like the whole choose your own adventure type film that um Netflix did not too long ago. Uh, and also Shimbuya from People Pleasers building, you know, maybe that's what's going on here. Um, but yeah, again, the ape brand. Uh, like that's what people should, I, I really think should take away is that, you know, basically NFTs are just brands. That's what they are. The ape brand is really, really strong. So now there's a restaurant ape brand and now there is a movie ape brand.

• 1:03:12Ryan Sean Adams?

  It's basically a brand, brand manager, a community and some capital. That's to me what an NFT is, like an NFT community is.

• 1:03:21David Hoffman?

  But also like my, my bear case for that is this, like for anyone that doesn't own an ape NFT. They're not incentivized to go watch the movie. They're actually kind of disincentivized a little bit because they're.

• 1:03:32Ryan Sean Adams?

  You're kind of cringed out by it a little bit. You're like, I don't have an ape.

• 1:03:35David Hoffman?

  Yeah, right. Like, I don't care about your community. Like, I'm not gonna go watch your stupid movie.

• 1:03:41Ryan Sean Adams?

  That's true. I, I, I do think that uh, some of these things could actually flop in weird way. Like, I don't know. It all depends on the brand management of it. There's a lot of dependencies here. I, it's gonna be really interesting to see these things play out. Here's, here's an experiment that didn't play out so well.

• 1:03:54David Hoffman?

  Oh, God.

• 1:03:55Ryan Sean Adams?

  So this guy, a crypto entrepreneur, uh, purchased Jack Dorsey's first ever tweet. So the first time Jack Dorsey logged on to Twitter, 2006, he tweeted something. He purchased it as an NFT. For $2.9 million, a JPEG of the tweet. I wonder if you could see what it looks like. Uh, actually, let me pull it up in the report.

• 1:04:18David Hoffman?

  The tweet was from Scent and the tweet was something along the lines of uh, just trying out my Twitter account tweeted from Jack. It was the first tweet ever.

• 1:04:25Ryan Sean Adams?

  Just trying out my Twitter account. Anyway, he paid $2.9 million for it. And then David, he went to go sell it. So he's like, ah, I, I kinda wanna sell it. I'm gonna auction it out. I'm gonna give some proceeds to a charity. He thought he'd be able to sell maybe $25 million NFT space. I bought it for 2.9. It's got appreciated value. I guess the closing bid, the last bid he got, $280. For an NFT, he paid 2.9. 2.9 million dollars for.

• 1:04:57David Hoffman?

  What's the multiplier or the, oh god, that's like down point 99.99%.

• 1:05:04Ryan Sean Adams?

  That is some tax loss harvesting, my friend.

• 1:05:06David Hoffman?

  That's a down bad right there.

• 1:05:08Ryan Sean Adams?

  That's real down bad. Now, he's probably not going to sell it for that, but it just goes to show you like, man, you can really get wrecked by NFTs. And I think a lot of the, the success that we read about NFTs, for every success you see of somebody making millions of dollars, it has to be like 99, at least failures, probably 999. It's just the survival bias where we always hear about the guy who just made, you know, $5 million on an NFT flip.

• 1:05:34David Hoffman?

  Right. Yeah, well, I had a take about this. Remember when somebody bought the Beeple NFT for $69 million?

• 1:05:43Ryan Sean Adams?

  Yes.

• 1:05:43David Hoffman?

  How do you, how do you think that's, what do you think that's doing on the secondary market?

• 1:05:46Ryan Sean Adams?

  Oh, I have no idea. I have no idea.

• 1:05:49David Hoffman?

  Over or under, over or under $1 million?

• 1:05:53Ryan Sean Adams?

  I'm gonna say I would not have departed with my ETH for that purchase, okay? I would just kept my ETH for that purchase because I think it's, it's an asset that's gonna appreciate more than the Beeple, but you know, who knows?

• 1:06:05David Hoffman?

  That's right. Okay.

• 1:06:06Ryan Sean Adams?

  Beeple sold his ETH from that too. A whole big chunk of it.

• 1:06:09David Hoffman?

  Yeah. At what price? Like 3,000, I think?

• 1:06:13Ryan Sean Adams?

  Yeah, I guess he thinks he's up. Maybe, maybe he's okay. I don't know. I'm sure Beeple's gonna be fine.

• 1:06:17David Hoffman?

  I think Beeple's doing just fine.

• 1:06:18Ryan Sean Adams?

  Yeah, I'm sure he's gonna be okay. What's this? There is people taking loans on their NFTs now. We've talked about that for a while. It looks like it's happening. This is the biggest one I've seen. Somebody borrowed $8.3 million on their CryptoPunk, the value of their CryptoPunk?

• 1:06:32David Hoffman?

  Yeah, remember that story of the CryptoPunk lot that was going to Sotheby's, 104 of them? And the guy, like, the, like, hours before the lot, because the CryptoPunk floor was like plummeting at that time? And then he was gonna sell 104 CryptoPunks and then he just changed, he changed his mind last minute? Well, he got liquidity in a different way by borrowing $8.3 million on his, against his 104 CryptoPunk, CryptoPunk loan collateral.

• 1:06:55Ryan Sean Adams?

  You know what? That is tax-free liquidity, my friend. Another pro tip for you. This is the tax edition of Bankless.

• 1:07:01David Hoffman?

  Don't get liquidated.

• 1:07:03Ryan Sean Adams?

  Yeah, just don't get liquidated. I'm sure he's fine. So that was a batch of 104 CryptoPunks, not just one, obviously, which is why he's getting so much. And die-denominated, which is kind of cool. All right, let's get to the Musk watch. Elon Musk, he was gonna join the board of Twitter last week. Now, this week, he's quitting that. He's not joining the board any longer. Something happened. Do you know what happened?

• 1:07:24David Hoffman?

  Yeah. Elon, this morning, I believe, yeah, this morning, Thursday morning, tweets out, "I made an offer," and then links to an SEC filed document, which is an offer to buy Twitter. Not buy shares of Twitter, buy Twitter.

• 1:07:41Ryan Sean Adams?

  The whole thing?

• 1:07:41David Hoffman?

  The whole thing, for an average, for a share price of $54.20, which is a 54% premium over the January 28 closing price. I'm not sure why the January 28 closing price matters, but yeah, valuation of $43 billion.

• 1:08:00Ryan Sean Adams?

  Wow.

• 1:08:01David Hoffman?

  Elon Musk made an offer to buy Twitter.

• 1:08:03Ryan Sean Adams?

  Wow, how crazy would that be if that happened? So how much is this total?

• 1:08:10Ryan Sean Adams?

  Do we know how much this is?

• 1:08:11David Hoffman?

  I don't know.

• 1:08:12Ryan Sean Adams?

  Oh, $43 billion, David. It's $43 billion. So that's only like an eighth of a Musk. That's not very much.

• 1:08:20David Hoffman?

  Can't he like, I'd really like him to stick to the whole rockets and electric cars thing.

• 1:08:26David Hoffman?

  I don't think Twitter's as important as Twitter's.

• 1:08:29Ryan Sean Adams?

  Some people think he's gonna be really good for Twitter, David, like promoting through speech.

• 1:08:34David Hoffman?

  I think Elon Musk has the potential to be really good for Planet Earth, and Twitter doesn't really have that same potential.

• 1:08:39Ryan Sean Adams?

  Interesting. As a Twitter power user yourself, are you like not bullish on Twitter?

• 1:08:45David Hoffman?

  I would like the planet to not die of climate change, and also for humans to become an interstellar species, and Twitter's not doing anything in those regards.

• 1:08:54Ryan Sean Adams?

  Stick to what you know Elon. That's what David's saying. Like you're really good at some things. Go focus on that.

• 1:08:59David Hoffman?

  He does tweet a lot.

• 1:09:00Ryan Sean Adams?

  But he'd have to outbid Justin Sun. Apparently, Justin Sun is offering $60 per share? Is this real? Is this a real tweet?

• 1:09:08David Hoffman?

  Yeah, this is a real tweet. For Justin Sun is a one-upping Elon Musk. I tweeted out, "Justin Sun, the me-too founder of the world." Just like, "Oh, notice me offering $60 a share." I don't know if Justin Sun has that much money. Pretty sure he doesn't.

• 1:09:22Ryan Sean Adams?

  If he does, it makes me very sad, because I know.

• 1:09:27Ryan Sean Adams?

  Yeah, but that's a "please notice me" type take. Anyway, we'll see. We'll see if that happens. Next week, it could totally change. You know, next week, maybe Elon's buying Facebook or something. We'll have to see. All right, switching gears for a minute, we got to update you guys on the Axie Infinity hacker. Remember the hacker that stole hundreds of millions of dollars worth of ETH from the Axie Infinity bridge to the Ronin sidechain? Well, we're curious what he's doing with all of that money. How this hacker, he, she, they are exiting the system. This is a tweet from watcher.guru, somebody watching all of these accounts. "Axie Infinity hacker has so far laundered 7.5% of the stolen Ethereum using tornado cash."

• 1:10:11Ryan Sean Adams?

  "Tornado cash to launder it," which is of course a sort of a privacy coin mixer, I might say, Tumblr on Ethereum. So what does this mean, David?

• 1:10:20David Hoffman?

  Yeah, so when you put your Ether into tornado cash, you can do it, I think, in lots of 1, 10, and 100 Ether. And then all of those get bundled up together, and then you sit and just like let it steep and stew, because people are putting in Ether, people are pulling out Ether. So like you wait some period of time, and then you pull it out the other side, and no one really knows.

• 1:10:40Ryan Sean Adams?

  You get lost in the crowd, basically.

• 1:10:42David Hoffman?

  Exactly, lost in the crowd, right? 7.5% of that, one of the largest hacks in DeFi ever, is a significant amount of Ether. And so I asked the question to Twitter, it's like, "Well, like..." Imagine, for example, you put in like 50% of all the ether inside of tornado cash. We know exactly how much ether is in tornado cash. We just don't know whose it is. So I tweeted out, can some Dune analytics wizard tell me what percent of ether in tornado cash this is? Because if the hacker puts all their ether into tornado cash, and then your wallet withdraws ether from tornado cash, you could be like, oh, maybe you're the hacker, right? Because so much of the ether is tainted. But as it turns out, the Ronin hack was 173,000 ether.

• 1:11:26David Hoffman?

  7.5% of that, the deposited ether from the hacker is 13,000 ether. Total ether in tornado cash, Ryan, 180,000. So that's about 7.5% of all tornado cash ether. So actually, like 7%, 7.5% of that hack is actually pretty like below the threshold. There's a nice graph that actually shows the very large deposit into tornado cash. You might have it pulled it up in the next tab. So yeah, you can see all the inputs and outputs, the red spikes, the green spikes going into tornado cash. And it turns out tornado cash has enough liquidity to hide a pretty sizable amount of ether. And so tornado cash is averaging 6.6,000 ether per day in withdrawals,

• 1:12:10David Hoffman?

  which is up significantly from, according to this tweet, from where it was a couple of weeks ago. But yeah.

• 1:12:16Ryan Sean Adams?

  Well, what do you think about this? Do you think, like, I'm surprised we haven't heard the Elizabeth Warrens of the world, you know, talking about this, maybe Ethereum, bucketing Ethereum, the whole mix, as basically a money laundering protocol and see this is how criminals, you know, can escape with cash, right? And, you know, like privacy, on-chain privacy is bad. And the chain analysis of the world, maybe they can see into this thing, but maybe they can't. What do you think about that?

• 1:12:45David Hoffman?

  It's privacy is a human right, but this is also a money laundering tool. So there's that.

• 1:12:54Ryan Sean Adams?

  Mixed, right? Mixed reviews here.

• 1:12:56David Hoffman?

  Technology is inherently neutral. It's about how it's used. But privacy as a human right comes before anti-money laundering efforts.

• 1:13:06Ryan Sean Adams?

  You kind of have to, if you choose to prioritize privacy, then you kind of have to take the good with the bad. Isn't there just a fundamental trade off here that society has? And by the way, this is not a crazy trade off. We've had this in cash forever. And this hasn't caused the downfall collapse of society, right? Still the ability to find these criminals via other means without eroding the privacy of every individual citizen and knowing exactly what they own and exactly who they are. So it's something I feel like the crypto industry has to get stronger on. But I do also feel like it's a, it's a losing battle in the political soundbite game. Where somebody would be like, oh yeah. And then they just laundered all this money through tornado cash, the money laundering tool.

• 1:13:47Ryan Sean Adams?

  And then pretty soon everyone who's ever used tornado cash just to obfuscate their identity for like legitimate reasons, non-criminal reasons, they're painted in the same brush. So if you're using a privacy protocol at all, well, you must be a criminal rather than you just want to preserve your actual on-chain privacy. And yeah, this is slippery slope because then, then exchanges start blacklisting any address that's interacted with tornado cash. You can imagine something like this happening. And then the only outlet for you is decentralized DeFi type protocols that have no ability to blacklist, right? So this is why all of these things are very important, I think, but it's a complex subject.

• 1:14:29David Hoffman?

  Yeah, Bitcoin has proof of work as its big Achilles heel in its narrative. I think privacy on Ethereum, because tornado cash is actually a pretty inferior form of privacy. Aztec technology, ZK rollup, which is not just, not ZK rollup, is zero knowledge proof technology. Like the Aztec layer two is going to be a completely private layer two. Like the technology, the privacy tools on Ethereum are only going to get orders of magnitude better, more secure, more private and more usable. This is going to be our narrative Achilles heel. Like, this is going to be the attack vector for Ethereum is privacy.

• 1:15:03Ryan Sean Adams?

  It's, I think it's privacy in general, and yes, and Bitcoin has no privacy. In fact, there's, there's a whole really interesting discussion, which I don't think crypto could have gotten as far as it, it has gotten to this point without like nation state kind of choking the, the baby in the crib. If it had privacy on the base layer.

• 1:15:21David Hoffman?

  There's a reason why Monero is not on any exchange. But also Lightning Network, Ryan, is private. That's a private technology.

• 1:15:28Ryan Sean Adams?

  Anyway, it's, that's definitely a trade off and it's something that we're going to have to, discuss with regulators in the future. All right, guys, we're going to burn through a few more things. Near, they're launching an algo stablecoin on the 20th of April called USN. This is going to be like UST for Terra. So other alternative layer ones joining the space there to compete for Terra. David, what's this? Hire?

• 1:15:52David Hoffman?

  Center, an organization consortium or a between circle between with USD and also Coinbase, has hired two executives to oversee regulation operations. These are kind of one of our, our spearheading entities, helping us fight the fight in regulation. So we like to see that.

• 1:16:09Ryan Sean Adams?

  More regulatory firepower. Also Celsius, so this is a centralized lending and borrowing project exchange, I guess. Crypto bank, you might call them. Yeah, app, similar to BlockFi. They have now made it such that non accredited investors in the US will not be able to deposit new assets in their account. So this happened with BlockFi in February. This is the SEC coming down on these custodial crypto lending and borrowing protocols and saying, nope, can't do that, not here, not in the US, not to unaccredited investors, not to people who have less than $1 million in assets. So where do we go from here? We move to DeFi and also the Celsius's and the BlockFi's of the world seek to become regulated entities.

• 1:16:53Ryan Sean Adams?

  So they can start doing this sort of thing. David, let's talk about some more regulatory pressure, and this is coming from an interesting place. A series of class action lawsuits, and this is a new one that dropped to our attention this week. This is a class. Action lawsuit from a Uniswap user. Are you a Uniswap user? If you're listening to Bankless, you probably are, right? You may have been in the past. This is a Uniswap user that is accusing Uniswap Labs of allowing fraudulent activity on its protocol. Okay, and non-registered securities, other fraudulent activity. Apparently, this user, and you can read the entire plaintiff and the complaint, the class action complaint here.

• 1:17:38Ryan Sean Adams?

  This user bought a whole bunch of Uniswap gems, right? Some might call these shitcoins. In last year, last summer, so like, you know, June, May of last summer. Like, stuff like, you know, the classics, like, good old Ethereum Max.

• 1:17:53David Hoffman?

  Oh, I love that one.

• 1:17:54Ryan Sean Adams?

  Matrix Samurai, and Rocket Bunny, and BoomBaby.io.

• 1:18:00David Hoffman?

  Oh, God.

• 1:18:00Ryan Sean Adams?

  And if you read the complaint, about 10K was invested in these things. And almost all of them went to zero, near zero, right? And so, the complaint is that Uniswap allowed this to happen. And so, named in the lawsuit is Uniswap, Hayden Adams, investors in Uniswap Labs, like A16Z, basically everyone they could think of. This is so crazy to me, David. I have some reactions to this, but I want to hear yours first. What do you think about this?

• 1:18:36David Hoffman?

  This feels malicious. This feels like they were doing this with intent in order to smear Uniswap, right? This is not just, in my opinion, there's perhaps a case to be made that this is not just some innocent person who got some Uber driver tips to buy Ethereum Max or Rocket Bunny, but instead are using this as a way to get into, start targeting DeFi legally. It's not the first time we've seen this. Ryan, you'll remember, a number of months ago, somebody deposited $10 into Pool Together and started suing, then class action lawsuited Pool Together for losing money because of the gas fee, Ryan.

• 1:19:17Ryan Sean Adams?

  Are you kidding me? The gas fee?

• 1:19:19David Hoffman?

  Because they lost money because they paid the gas fee. Class action lawsuit against Pool Together. This effort is still going on. Now this happens, same thing, class action lawsuit against some obvious like, personally, Ryan, if I lost all my money in Rocket Bunny and Ethereum Max.

• 1:19:36Ryan Sean Adams?

  I think about my life choices.

• 1:19:37David Hoffman?

  I wouldn't publicize that.

• 1:19:41David Hoffman?

  I would not go publicly with that. And so I think that there's something insipid, insidious, what's the word?

• 1:19:46Ryan Sean Adams?

  Insidious, yeah.

• 1:19:47David Hoffman?

  Insidious, yeah, going on behind the scenes. And I think this story is going to have to be unfolded a little bit more.

• 1:19:53Ryan Sean Adams?

  You think this is a takedown, an organized DeFi takedown, possibly?

• 1:19:57David Hoffman?

  I think this is, there's something bad going on here.

• 1:19:59Ryan Sean Adams?

  Because how can you possibly blame Uniswap, which is a permissionless decentralized exchange that does not control asset listings at all, individuals do? How can you possibly blame smart contract code? The developers of smart contract code? This is to me, this is like, you know, blaming the developers of TCP IP for what just happened here. I mean, like, you may as well. Who originally created the TCP IP protocol that all of the rest of the internet transacts on? Maybe we can hold them responsible because I lost money on Uniswap. Like, or I was scammed from a Nigerian prince email or something like this.

• 1:20:36David Hoffman?

  Or somebody made me mad on Twitter.

• 1:20:40Ryan Sean Adams?

  It's just absolutely ludicrous. And what I'm worried about is that there might be some, I guess, court precedent that negatively impacts DeFi. And like, I guess, even best case scenario, man, these DeFi projects get tied up in these class action lawsuits. Anyway, that's why we do what we do. We got to talk about these protocols more and the value of them. Guys, we're going to get into some hot takes of the week. But before we do, we want to thank the sponsors that made this episode possible.

• 1:21:09David Hoffman?

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• 1:21:54David Hoffman?

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• 1:21:59David Hoffman?

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• 1:22:45David Hoffman?

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• 1:23:30David Hoffman?

  The CL card is a crypto debit card that hooks right into the Ledger Live app, right next to all the DeFi apps and services that you're already used to doing, like swapping tokens and staking. So if you don't have a Ledger hardware wallet, go to ledger.com, grab a Ledger and take control over your crypto.

• 1:23:46Ryan Sean Adams?

  All right, guys, we're back with the takes of the week. This is one from Dan Price about taxes. That's the theme of this episode, David. What's this say?

• 1:23:53David Hoffman?

  Yeah, Dan Price says, "Every other country, here are your taxes. Does this look okay? America version, TurboTax and H&R Block lobbied Congress, so you have to pay them hundreds of dollars and pull together all of the paperwork the government already has on you to file your taxes manually." Reminder that this is the state that we are in.

• 1:24:11Ryan Sean Adams?

  Yes, it's sad.

• 1:24:13David Hoffman?

  Sick. Everyone that is stressing out over taxes, you can thank TurboTax and H&R Block. Thank you.

• 1:24:19Ryan Sean Adams?

  Well, it's IRS and Congress, I suppose. This is a question I've had in my mind, David. I'm gonna just ask, but it's really this question we've talked about in some Bankless shows, but are there going to be local or global winners for DeFi, right? And a global winner is like one kind of lending and borrowing protocol that establishes some sort of power law network effect, like say AVE. It gets deployed across, you know, all of the chains, for example.

• 1:24:44David Hoffman?

  Polygon, Avalanche, Fantom, whatever.

• 1:24:46Ryan Sean Adams?

  All of the chains, right? And it'd be AVE. This is the winner of lending and borrowing, for example, or compound or something like this. The local version of things is, no, every single chain ecosystem will have its own automated market maker and lending and borrowing protocols. So like on Avalanche, you'll have Trader Joe. And on Ethereum, you might have Uniswap. And on Polygon, you might have like a QuickSwap or something like this. This has been a big question in my mind because it's like a question of, how do you invest? Do you invest with the big ones? Or do you have to look for like winners across every single chain? So I asked this question. Do you guys think there will be local winners or global winners? A few good responses here. The majority seemed to indicate that like global winners would win,

• 1:25:31Ryan Sean Adams?

  which was kind of my inclination. But this guy, Hildabi, actually provided some data behind this. You want to read this tweet out?

• 1:25:40David Hoffman?

  Yeah, stats following Uniswap's arrival on Polygon leads me to believe that user stickiness will lead to global winners. In my opinion, the average user sticks to what he or she is familiar with, but it will be interesting to see how things develop. And then he gives a graph that shows how dominant Uniswap is across all the DEXs on Polygon. One asterisk on this is that if you're using Polygon, you're more likely to be an Ethereum user, and if you're an Ethereum user, you're likely to be a Uniswap user, going across a different ecosystem to Solana or Avalanche, especially Solana, because Solana's not EVM, Avalanche is EVM. Like, maybe there's a different taste, because it's a very different user base, rather than just a slightly different user base.

• 1:26:21Ryan Sean Adams?

  So how do you think this shakes out?

• 1:26:22David Hoffman?

  I think you're right. I think the Uniswap branding is very, very strong. Also, that technology is very, very strong as well. Like, Uniswap V3 is robust, right? Like, it's hard to compete with that. And so I think that lends itself to global winners.

• 1:26:36Ryan Sean Adams?

  I think we might have, like, a combo, too.

• 1:26:39David Hoffman?

  Oh, yeah, certainly.

• 1:26:40Ryan Sean Adams?

  I think we'll have some... But you know how, like, in countries, right? There's like, sort of, the, you know, the Google of China, for example, for various reasons? Like, some countries have their own flavors of this. I think you'll see some of that, too, but then you'll also see some big global power law winners. Like, there might be some geographic boundaries in these chains here that we don't see. Like, maybe EVM versus non-EVM is one of them.

• 1:27:03David Hoffman?

  I think that's right.

• 1:27:04Ryan Sean Adams?

  It'll be interesting.

• 1:27:06David Hoffman?

  Leaning towards global winners.

• 1:27:07Ryan Sean Adams?

  Yeah. This is an Eric Wall...

• 1:27:09David Hoffman?

  The EVM is... I can see, like, there being global winners amongst all EVM chains and all non-EVM chains having their own local winners.

• 1:27:16Ryan Sean Adams?

  Yeah, that's one possibility, for sure. Uh, this is an Eric Wall tweet. What's he saying here?

• 1:27:22David Hoffman?

  He's taken a screenshot, and the screenshot is of other tweets. And the first person says, "The gas fees on Avalanche are getting ridiculous." Somebody follows that up, saying, "Yes, a transaction previously cost me 6 cents, and now $6.50. That's a 10,000% increase." I'm not sure on the math on that one. And then Eric Wall retweets this, saying, "Obviously, the solution is an EVM fork." Which poses the question, what is the model of scaling that the crypto industry is going to have? Every time a Layer 1 blockchain gets full, are we going to...

• 1:27:52Ryan Sean Adams?

  It gets expensive.

• 1:27:53David Hoffman?

  Gets expensive, get full, same, same. Are we going to, A, one, just spin up another Layer 1 blockchain that's an EVM fork? Like, another Getth fork, spin that out as blockchain, raise a bunch of VC cash? Or, when a Layer 1 blockchain gets full, do you just spin up another Layer 2? Which model of scaling is the industry going to go in? And lots of people in this, and this is, I feel like, the question of 2021 and now going into 2022. How will the crypto industry scale? Will we put out more Layer Ones? Or will we put out more Layer Twos?

• 1:28:24Ryan Sean Adams?

  I do think that these are the two models, David. And I want to get to your post that you published this week about one of the models. But basically, the two models are, are we going to live in this world of interconnected sidechains with their own validator set? So none that are really like market dominant, just a whole bunch of new sidechains that we keep spinning up, all with their own defense and security spend? Or are we going to live more in a world of like something like Ethereum, where there's one modular chain that kind of provides economic security for a whole bunch of other Layer Twos? And the dichotomy here that I've heard, which is kind of an analog to the real world, is,

• 1:29:06Ryan Sean Adams?

  will we live in a world of like many nation-states with providing their own security? Or will we live in a world with empires? And maybe some dominant empires, some modular blockchains that kind of provide security for like spheres of influence, if you will, territories, states and provinces, and alliances with other countries? So you wrote about this, I think, in your post, the empire model for blockchains. And what's the argument that you're making?

• 1:29:36David Hoffman?

  Yeah, the argument that I'm making is that if you are not playing to be the number one spot, then you are not playing. And I think the evidence for why this is going to be an empire model of a blockchain network, rather than, you said nation-states, Ryan, but I think the alternative model is like many, many city-states.

• 1:29:52Ryan Sean Adams?

  Oh, yes, that's what I meant, city-states, not nation-states.

• 1:29:55David Hoffman?

  Yeah, so like rather like one dominant like nation that blankets the whole like world with their blockchain, right? Like, I think the Ethereum empire model, the many, many Layer Twos model is going to be the dominant one. And the interoperable sidechains, a network of sidechains, where Avalanche is the sidechain to Ethereum, which is a sidechain to Solana, which is a sidechain to Avalanche. And there's a mesh network of sidechains. Like, that doesn't make sense. And people know this subconsciously in the tribalism and the fighting that happens on crypto Twitter. The reason why we fight, the reason why crypto Twitter is tribal is because we all, at least subconsciously, some people consciously know this, and I'm trying to get people to consciously know it, which is why I wrote the article.

• 1:30:37David Hoffman?

  We subconsciously know this is true, and that's why we are tribal, because we all want to be the number one spot. We all want our blockchain to be the number one thing.

• 1:30:44Ryan Sean Adams?

  We all know we're playing the empire game.

• 1:30:46David Hoffman?

  We are all playing the empire game. Liquidity begets liquidity, capital begets capital, network effects begets network, network effects, and the number one blockchain claims all of these things. And so like, and this is also just completely rational in game theory. Because if you aren't, if you're fighting to be a good sidechain, to be interoperable with other good sidechains, you're going to lose to the blockchain that's fighting to be the empire. And there's a, and we, in the last six months, over a billion dollars has been hacked, Ryan, in what? In cross-chain bridges, insecure bridges. Bridges are going to be the next big attack vector, and layer two cryptographic bridges are always going to be more secure

• 1:31:29David Hoffman?

  than cross-chain multi-sig bridges. And so a, a empire model where there's one layer one with many, many, many, many layer twos that come to blink at the earth is fundamentally more secure than a poly cross-chain layer one model.

• 1:31:44Ryan Sean Adams?

  I think, you know, so first of all, I would say Bitcoiners acknowledge this and realize this about Bitcoin. This is why they fight hard. I think the Ethereum community doesn't so much. And I don't think, I think they might like cringe a little bit in the framing of this.

• 1:31:59David Hoffman?

  Yeah, the empire is a spicy word.

• 1:32:00Ryan Sean Adams?

  I think, I think the reason they do though, David, is because they're used to empires, the, the nation-state analog of like, empire by conquest, like that's how you go build an empire. In the nation-state world, you have to go like conquer another set of peoples and take from them. Uh, but this is not empire by conquest. This is empire by opt-in, not conquest. Um, opt-in, right? And so. Basically, the model is, oh, rather than spending, if I'm a sidechain, you know, a question, rather than spending for my own economic security and spending, by the way, I just have to inflate my my token supply. Like, it's really expensive. People don't look at this very often, but I know you and I look at this a lot, which is how much are chains actually spending in blockchain issuance for their security?

• 1:32:45Ryan Sean Adams?

  And it's a whole lot of money to maintain that level of security. Instead of doing that, why don't I just outsource my security? Why not opt into the Ethereum Federation?

• 1:32:54David Hoffman?

  Yeah, I'll just have Ethereum protect me.

• 1:32:57Ryan Sean Adams?

  Yeah, and, and, and, you know, I like that ecosystem anyway. I'm EVM, whatever, like, there's a lot of network effects. So let me just build that bridge and I'll become a rollup rather than a sidechain. Right? It seems to me, and again, it's not opt in. No, no one in Ethereum like went and like conquered that sidechain. It was just basically like, oh, I'm looking at the economics of this and I'm trying to make the most rational decision. And so I'm going to become a subsidiary of Ethereum. And I do think that that model has got to be like, that's sort of the model that we've seen play play out in the conquest world of nation states where we don't have a whole bunch of Singapore's and Hong Kong's. It's like former Hong Kong, like, we don't have a bunch of city states.

• 1:33:40Ryan Sean Adams?

  We have some pretty dominant nation state empires. Maybe we have multiple, that could also be the case, and it is the case now, but there will probably be some eras and power law winners and in a more like dominant empires. And I do think that is the quiet part that the Ethereum community doesn't say out loud. When you enter the we're fighting for monetary premium game, you necessarily enter that game of like, I guess, opt in empire building.

• 1:34:07David Hoffman?

  And there's so much evidence as to why this is the right model, because this is the model of coordination ever since humans stopped being hunter gatherers and we started being settlers and we actually created civilizations with property. We started this coordination game of who pays taxes to who, right? Like, who, who can have the monopoly on violence? And in the, in the blockchain world, it's who can have the strongest security. But like, you know, in the, in the physical world, a monopoly on violence is like, all right, whoever has the largest military gets to control the global reserve currency. In the blockchain world, it's whoever's, whichever blockchain has the best security has the best money, money properties of that layer one.

• 1:34:48Ryan Sean Adams?

  Okay, I would just also say to that, though, what you just said and what I just said, nine out of 10 VCs disagree with that.

• 1:34:55David Hoffman?

  Yes, yes.

• 1:34:56Ryan Sean Adams?

  Maybe 10 out of 10.

• 1:34:57David Hoffman?

  Because they're incentivized for as many Layer 1 blockchains as possible because it's VC service areas, VC playgrounds.

• 1:35:03Ryan Sean Adams?

  Maybe. So, yes, that's what we might say, but like, let's flip that around. Like, I think it's worth steel manning their argument. And basically, more the steel man is, they don't believe that security and like, defense, economic security of the chain is kind of the number one property. Like, they would prioritize user experience, for example, far higher. And user experience is associated with low gas fees as well. Like, and if you have to make lots of trade-offs on security, decentralization security, you know, people forget what decentralization is. Like, it's good to remind people, it's an anti-corruption technology. So, it helps preserve, it helps keep the cancer at bay.

• 1:35:48Ryan Sean Adams?

  It's like the white blood cells fighting the cancer in the spread in the body of the system, okay? And like, they'll make some trade-offs there, where they'll introduce more potential for future corruption in exchange for usability. And they'll say that, like, that's what users actually care about, it's the user experience, it's not the security. And so, it's not the highest, like, people don't care, you know, one VC put it this way, people don't care about, like, what chain they're interacting with for security reasons, they care about risk more. It's like, what's the risk? And so, risk and security are related, but it's not one-to-one. There could be, you know, secure chains that have risks in other ways. And so, they want to minimize risk over the long run. So, I think a VC would push back on that and be like, hey, it's not actually a battle

• 1:36:33Ryan Sean Adams?

  for maximum security, David, it's actually a battle for network effect and utility and user experience, because that's going to drive the most users and the most liquidity over the long run.

• 1:36:44David Hoffman?

  Yep, and I highly, highly encourage people, please go read this article. It's one of my favorites that I've written in a long time. Link in the show notes.

• 1:36:52Ryan Sean Adams?

  That's cool. All right, man, those are the takes, but what are you excited about this week? You liking Brooklyn? Is that exciting?

• 1:36:57David Hoffman?

  Dude, I'm loving Brooklyn. There's a DAO meetup that I'm going to later today. Was just like, seeing just a list of the invitees, like, oh, these are all my friends. This is great. Oh, gosh, like, I never had this in San Diego, or really any other time ever. And so just going to be in where DAOs are being built, where the Metaverse is being built, here at the epicenter of it all, which is Brooklyn. Williamsburg is really, really exciting. There's a Boys Club meetup that I'm going to later today, Ryan, which is also going to be lovely. And they're at the same time, so I have to like, party hop, and it's a Thursday. So that's gonna be really exciting. I'm still like, walking around Brooklyn, deciding what part of it I'm trying to find an apartment in, but apparently...

• 1:37:34Ryan Sean Adams?

  But you're definitely doing it. You're making the move?

• 1:37:36David Hoffman?

  Oh, I'm doing it. Yeah, for sure.

• 1:37:37Ryan Sean Adams?

  Unless, look, next week, though, you're going to Amsterdam. What if you fall in love with a different city?

• 1:37:42David Hoffman?

  Oh, gosh, I don't know. I fucking fall in love with Amsterdam. I still love America. I mean, Amsterdam's got Web 3 people too, but nothing like Brooklyn and Williamsburg, right? Like, Williamsburg is the epicenter of the Metaverse. It's like, where the Metaverse find, has its like, link to the real world, because everyone that's building the Metaverse lives here. And so it's like, the Metaverse instantiate in Williamsburg.

• 1:38:03Ryan Sean Adams?

  David's starting to sound like a Brooklyn maximalist here. Brooklyn maximalist.

• 1:38:07David Hoffman?

  I never, ever, Ryan, thought I'd ever live on the East Coast, but here I am.

• 1:38:11Ryan Sean Adams?

  That's funny, man.

• 1:38:12David Hoffman?

  But then you're also, yeah, off to Amsterdam on Saturday for DevConnect. I saw this couple, like, last rollup, probably the nerdiest conference that I'm ever gonna go to.

• 1:38:21Ryan Sean Adams?

  Is this nerdier than like, than, what's it called? I'm thinking of, DREAM Conference?

• 1:38:27David Hoffman?

  ETH Denver?

• 1:38:28Ryan Sean Adams?

  ETH, no, no, no. DevCon.

• 1:38:30David Hoffman?

  Oh, well, I've never been to a DevCon, so...

• 1:38:32Ryan Sean Adams?

  Oh, you haven't?

• 1:38:33David Hoffman?

  No, never been to a DevCon.

• 1:38:34Ryan Sean Adams?

  Are you going this year?

• 1:38:35David Hoffman?

  Yeah, yeah, in Columbia, in October. I will be excited for that one on a future rollup. But this rollup is as DevConnect in Amsterdam. Gonna be modular blockchain talk, there's gonna be ETH staking talk, there's gonna be a shared secret validator from Oble Network talk. Oh my God, there's, this gonna be, I'm just gonna just geek out, it's gonna be great.

• 1:38:55Ryan Sean Adams?

  A lot of geek energy.

• 1:38:56David Hoffman?

  A lot of geek energy, bigly. And also gonna see Anthony Cisano, it's gonna be great to see him.

• 1:39:00Ryan Sean Adams?

  That's good.

• 1:39:01David Hoffman?

  And Ryan, what are you excited about?

• 1:39:02Ryan Sean Adams?

  Okay, so Bankless registered for a trademark of the Bankless name about a year ago. We finally got that back and we have the trademark.

• 1:39:12David Hoffman?

  I don't have my soundboard, but boop boop boop.

• 1:39:14Ryan Sean Adams?

  I know. It's pretty cool. So what's neat about this is I'm actually, when we get some time, I'm excited to try some like on-chain experiments with this thing, right? So what is a trademark? It's just a registration in a country, in a nation-state, or a set of countries that no one else can use this mark for a particular purpose. Like, no one else can use the Bankless brand for a particular purpose. Bankless has always been somewhat of a headless brand. You know, you and I are kind of spearheading the movement a little bit. I'm really excited about how we could like bring this trademark maybe on-chain and set the DAO loose on it, right? So what if you could, you know, basically create a non-revocable license for the DAO

• 1:39:58Ryan Sean Adams?

  and participants of the DAO to use this trademark? So for example, what if you could create a smart contract that was controlled by a snapshot vote? And the snapshot vote could vote on which new entity would get rights to the trademark and be able to use the Bankless brand or not? You could like revoke that or approve that via a bank DAO token snapshot vote. Like, how cool would that be? Or what if you had to hold a certain amount of bank tokens and stake them or do something like this in order to use that mark, use that trademark? I don't know. There's a lot of cool things and I'm excited to like, because what is a trademark? It's just a, it's just like a nation-state smart contract. It's a contract like with the nation-state.

• 1:40:43Ryan Sean Adams?

  And so can we tie that into? Yeah, it's an NFT. So can we create that, instantiate that on-chain, create kind of an integration layer here? So anyway, that's kind of nerdy stuff, but I'm excited to talk to some crypto smart contract experts and see what we could do there.

• 1:40:57David Hoffman?

  Yeah, there's a lot of potential there. For those who don't know, like, go to Instagram and type in "Bankless." Bankless HQ will show up, but so will like 50 other flavors of Bankless.

• 1:41:06Ryan Sean Adams?

  Bankless Brazil.

• 1:41:07David Hoffman?

  Bankless Brazil. Those guys are killing it. Bankless Russia, like Bankless Romania, like even some relatively small countries have like a Bankless social media account.

• 1:41:18Ryan Sean Adams?

  There's podcasts in Portuguese, like under the Bankless name, all sorts of things. And I would love to kind of usher them into the Bankless family, like even more officially through use of this, so.

• 1:41:27David Hoffman?

  Yeah, totally. So, nice find, nice NFT find.

• 1:41:31Ryan Sean Adams?

  It's cool stuff, NFT. Thank you, US government.

• 1:41:34David Hoffman?

  Cheers.

• 1:41:35Ryan Sean Adams?

  But you know what? Meme of the week, I guess, thank you, US government, again, or maybe not so much. Taxes were brutal, man. It's tax week, so we gotta end with these. What's this tweet that we're looking at?

• 1:41:46David Hoffman?

  This is a relatively niche tweet, but it's one boxer standing up, ready to go. We're like, okay, all right, I'm gonna file these taxes. Let's do this. And then the next scene is him sitting down, drinking water, goes, "Damn, filing that extension was easy."

• 1:42:00Ryan Sean Adams?

  You can get an extension to October. You can file those.

• 1:42:04David Hoffman?

  But only for filing taxes, you've still gotta pay.

• 1:42:07Ryan Sean Adams?

  Yeah, you still gotta pay.

• 1:42:08David Hoffman?

  You can't file extension to pay later.

• 1:42:12Ryan Sean Adams?

  That's awesome, David. Like, you are schooled up on all this stuff, man. This is another IRS meme. It's amazing.

• 1:42:19David Hoffman?

  How do you think I know these things?

• 1:42:21Ryan Sean Adams?

  Yeah, you've been hanging out with me a little bit, I think.

• 1:42:23David Hoffman?

  I've come a long way. All right, this next meme is coming from TheRugNews. It's the Onion for crypto. You should be following it because the Twitter account is hilarious. "IRS: Web3 Community employs tax strategy. We're finally getting guidance from the IRS." Their guidance is, "You'll figure it out."

• 1:42:42Ryan Sean Adams?

  So true. All right, guys, this has been the weekly roll-up that somehow turned into Tax Week. I don't know how, but we won't be talking about taxes for at least another year, right, David?

• 1:42:49David Hoffman?

  One more year, yeah.

• 1:42:51Ryan Sean Adams?

  All right, we're gonna leave you with one final moment of zen, but before we do, gotta tell you this. None of this has been financial advice. It never is. ETH and Bitcoin are both risky. So is DeFi. You could lose what you put in, but we are headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the Bangless journey. Thanks a lot.

• 1:43:43David Hoffman?

  Hey, we hope you enjoyed the video. If you did, head over to Bankless HQ right now to develop your crypto investing skills and learn how to free yourself from banks and gain your financial independence. We recommend joining our daily newsletter, podcasts, and community as a Bankless Premium subscriber to get the most out of your Bankless experience. You'll get access to our market analysis, our alpha leaks, and exclusive content, and even the Bankless token for airdrops, raffles, and unlocks. If you're interested in crypto, the Bankless community is where you want to be. Click the link in the description to become a Bankless Premium subscriber today. Also, don't forget to subscribe to the channel for in-depth interviews with industry leaders, Ask Me Anythings, and weekly rollups where we summarize the week in crypto and other

• 1:44:28David Hoffman?

  fantastic content. Thanks everyone for watching and being on the journey as we build out the Bankless Nation.