ROLLUP: Ethereum Merge Bellatrix Upgrade | Binance USDC Stablecoin Wars | Coinbase Treasury Tornado Lawsuit

1st Week of Mergetember, 2022 ------ 📣 ConsenSys | Mint a Merge NFT! https://bankless.cc/themerge 📣 Converge 2022 | Register with code Bankless250 for $250 off https://bankless.cc/Circle ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/ 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ ------ BANKLESS SPONSOR TOOLS: 🚀 ROCKET POOL | ETH STAKING https://bankless.cc/RocketPool ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum ❎ ACROSS | BRIDGE TO LAYER 2 https://bankless.cc/Across 🦁 BRAVE | THE BROWSER NATIVE WALLET https://bankless.cc/Brave 🌴 MAKER DAO | DECENTRALIZED LENDING https://bankless.cc/MakerDAO 🔐 LEDGER | SECURE STAKING https://bankless.cc/Ledger ----- Timestamps: 0:00 Intro 3:05 Merge NFTs https://bankless.cc/themerge 3:47 Converge 2022 https://bankless.cc/Circle 4:55 MARKETS 6:30 Crypto Market Cap https://www.coingecko.com/en/global_charts 7:20 Ethereum Gas Fees https://dune.xyz/hildobby/Gas 9:16 Merge Estimator https://bordel.wtf/ 10:00 Staking Unlocks https://twitter.com/TrustlessState/status/1565699759754592259 14:10 Ethereum Revenue https://www.theblock.co/post/167488/ethereum-miners-made-756-million-in-revenue-in-august-ahead-of-the-merge 15:10 EU Energy Crisis https://twitter.com/biancoresearch/thread/1566180431984205824 18:50 Energy Fallout https://www.euronews.com/next/2022/09/05/energy-bills-are-soaring-in-europe-what-are-countries-doing-to-help-you-pay-them 20:50 WAR! https://entrepreneurshandbook.co/for-the-war-fd5509d525d 29:00 MERGE UPDATES 30:17 Bellatrix Upgrade https://twitter.com/terencechain/status/1567115533233049606 32:35 Node Updates https://twitter.com/ajsutton/status/1567117139810873344 33:20 Economist Article https://www.economist.com/finance-and-economics/2022/09/06/the-future-of-crypto-is-at-stake-in-ethereums-switch 34:05 ETH PoW Fork https://www.coingecko.com/en/coins/ethereum-pow-iou 37:35 Stake From Home https://twitter.com/songadaymann/status/1562930578571272192 43:45 STABLECOIN WARS https://www.coindesk.com/business/2022/09/05/binance-to-convert-users-usdc-usdp-tusd-into-its-own-stablecoin-busd/ 47:00 Good for USDC https://www.coindesk.com/layer2/2022/09/06/who-benefits-from-binance-converting-usdc-to-its-own-stablecoin/ 50:05 Coinbase MakerDAO Proposal https://forum.makerdao.com/t/mipxx-coinbase-usdc-institutional-rewards/17703 55:00 1inch Optimism Airdrop https://cointelegraph.com/news/1inch-users-on-optimism-to-receive-airdrop-of-300-000-op-tokens 56:45 Reddit NFTs on OpenSea https://thecouchcommute.com/reddit-nfts-selling-for-thousands-on-opensea/ 57:15 ENS August Numbers https://twitter.com/ensdomains/status/1565374366791057409 59:37 ProtocolGuild NFTs https://twitter.com/trent_vanepps/status/1567177788561424384 1:01:15 Coinbase Suing the Treasury https://twitter.com/ViktorBunin/status/1567875895381168132 1:03:44 Brian Armstrong Statement https://blog.coinbase.com/defending-privacy-in-crypto-e09db33dece8 1:05:30 crvUSD Curve Stablecoin https://twitter.com/chago0x/status/1566874129843757056 1:06:00 Binance 6% ETH Staking https://blog.binance.us/eth-staking/ 1:06:45 Notional Leverage Vaults https://blog.notional.finance/introducing-leveraged-vaults/ 1:07:43 Sui Blockchain https://www.theblock.co/post/168532/mysten-labs-sui-blockchain-fundraise-ftx-ventures 1:10:15 GET A JOB https://pallet.xyz/list/bankless/jobs 1:12:00 QUESTIONS FROM THE NATION https://twitter.com/BanklessHQ/status/1567544177180672000 1:13:41 ETH PoW Eligibility https://twitter.com/johnny_kast/status/1567566362171654144 1:15:50 Value of ETH PoW https://twitter.com/mmaatt78/status/1567615122868166657 1:18:38 What Happens to Merged ETH? https://twitter.com/HenryJK4/status/1567550561758728192 TAKES 1:20:20 Surreal Proof of Stake https://twitter.com/TimBeiko/status/1567197184667578368 1:21:35 Remember This? https://twitter.com/ryansadams/status/1565681268913840130 1:23:45 BSC Network Effect https://twitter.com/apolynya/status/1566262032319451136 1:25:27 Reserve Currencies https://twitter.com/ryansadams/status/1567310589881360385 1:27:30 What David’s Bullish On https://twitter.com/TrustlessState/status/1567716721963814912 1:31:30 What Ryan’s Bullish On 1:34:45 MEME of the Week https://twitter.com/TrustlessState/status/1567903583563296772 ----- Not financial or tax advice. See our investment disclosures here: https://newsletter.banklesshq.com/p/bankless-disclosures #ether #ethereum #crypto #cryptonews #btc #bitcoin #ethpow

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

• 0:00David Hoffman?

  This is the last weekly rollup that will be under proof of work with Ethereum.

• 0:07Ryan Sean Adams?

  Bankless Nation, it is the second Friday of Merge Timber. What time is it, David?

• 0:12David Hoffman?

  Ryan, it's the Friday Bankless Weekly Rollup, where we cover the entire weekly news in crypto, which is always an ambitious endeavor, especially this week because it's Merge Week. Ryan, this is the last weekly rollup that will be under proof of work with Ethereum.

• 0:26Ryan Sean Adams?

  I know. That blows my mind. It's the very last one. In fact, you mentioned that this morning. I tweeted something out about it.

• 0:33David Hoffman?

  I know. You always take my ideas and put them into tweets.

• 0:35Ryan Sean Adams?

  Not always, but 50% of the time I do that. And, you know, like, I started to get a little bit nostalgic about it. And I don't know why.

• 0:44David Hoffman?

  Right.

• 0:44Ryan Sean Adams?

  Like, I don't...

• 0:45David Hoffman?

  It's the end of an era?

• 0:46Ryan Sean Adams?

  Yeah, I was never a miner. I know you did some GPU mining in your history. I'd never done that. But it does feel like the end of an era, and like, we're crossing something. And this is the very last rollup where Ethereum is on proof of work, and I guess that counts for something. So cross your fingers, next time you guys hear this, Bankless Nation, we will be post-merge. Be all proof of stake from there on out.

• 1:11David Hoffman?

  Okay, I'm just gonna make this joke once, and we're never gonna speak of it again. But like, we're praying that this is not like the Hillary Clinton election party of 2016, where they were completely confident that they were totally going to win against Donald Trump, and then Donald Trump won. Yeah, that's the last time we'll ever have to make this joke.

• 1:29Ryan Sean Adams?

  What a day that would be. That's just a joke. He's joking, guys, all right? David is actually highly confident that they're just...

• 1:36David Hoffman?

  But like, so we're all the Hillary Clinton fans.

• 1:39Ryan Sean Adams?

  So was Hillary.

• 1:40David Hoffman?

  Anyway, so was Hillary. But anyways, it is like this whole, "I was around in Ethereum when it was proof of work." People are going to say that in the future. And so if you were here, listening to Bankless, paying attention to crypto before Ethereum went proof of stake, that's pretty cool. That's pretty cool. Your kids are gonna think you're cool, hopefully.

• 2:00Ryan Sean Adams?

  There's only two times to buy ETH, before the merge or after the merge. There's only two times. That's it. You're here, and we're glad you're here with us, because we've got a lot to cover today. Uh, first, will we be merged next roll up? We just talked about that, but we're gonna go through the schedule of what the roll up week looks like next week, because next week is roll up week. We're looking at Thursday for the merge date. David, what else are we talking about?

• 2:23David Hoffman?

  We are also talking about Binance rugging all non-Binance USD stablecoins on its platform, but it's actually a good thing. What happened there? Binance swapping out other people's stablecoins. We'll talk about that. Also Coinbase going to bat for the crypto industry, putting a lawsuit down on the table in front of the Department of Treasury because of tornado cash. So yeah, Coinbase footing the bill for a treasury against lawsuit, saying that what the treasury has done with banning tornado cash is unconstitutional outside of their just jurisdiction and just against innovation. So Coinbase, nice job with that. We'll go into all those details later in the show.

• 3:04Ryan Sean Adams?

  Grab your popcorn, guys. And of course, grab your coffee, because this is gonna be a good one today. David, before we get in, gotta share some special news from our friends and sponsors at Consensus, because they are giving away a free NFT to commemorate, to celebrate the merge.

• 3:20David Hoffman?

  To prove to your kids that you were here during the merge.

• 3:23Ryan Sean Adams?

  That's right. So I'm definitely gonna collect one of these. And if you want to be first to know about it as soon as it goes live, so that you can mint one of these merge NFTs, commemorative NFTs for free, you need to click the link in the show notes, click this button on the Coinbase website called Be The First To Know. It's got some merge information, type in your email address, and they will send you an email when it is ready to mint, and you can mint that for free. So that's the first thing we got going on. Also, David, there's a conference that you're attending at the end of September. You should tell folks about that and some discounts that are available.

• 3:56David Hoffman?

  Yeah, of course, Converge 2022 in San Francisco. Your boy's gonna become a West Coast boy for a half second, the September 27th through the 30th. This is being put on by Circle. This is Circle's Converge event, of which there will be many speakers who you might be familiar with, Jeremy Elair, of course, the CEO of Circle, but also Mike Anderson from Framework, Vitalik, of course, will also be giving a talk, and so many, many others in the industry. So if you are in San Francisco, definitely get a ticket. If you're around San Francisco, definitely get a ticket, because I will see you guys all there. There is a link in the show notes to get a discounted ticket.

• 4:32Ryan Sean Adams?

  Yeah, juicy discount too. I think hundreds of dollars of off, $250 off. And that, by the way, that discount expires on the 15th of September. Expires the day of the merge. So you better pick that up before the merge.

• 4:46David Hoffman?

  But by the time we tell you next roll up, it'll be expired. So this is the time.

• 4:51Ryan Sean Adams?

  David acting like he's an east coaster here. He's gonna be a west coaster for a hot sec. All right, east coast David, let's get to the markets today. What's Bitcoin looking like on the week? Are we above 20K?

• 5:02David Hoffman?

  No, we are not. We started the week at $20,070. We are ending the week at $19,250. Down about 4% on the week for Bitcoin.

• 5:13Ryan Sean Adams?

  I don't like that, being below the 2017 all-time high on Bitcoin.

• 5:16David Hoffman?

  Overall, the Bitcoin chart looks not awesome.

• 5:19Ryan Sean Adams?

  No, that's not feeling good. How about ETH? Any better news for us here?

• 5:22David Hoffman?

  ETH is up 3.5%. So started the week at $1,570, $1,570. Ending the week at $1,630, up 3.5%. So Bitcoin down 4%, ETH up 3.5%. Ryan, it feels like the merge. It feels like the merge trade.

• 5:40Ryan Sean Adams?

  Yeah, some merge music.

• 5:41David Hoffman?

  It feels pretty mergey.

• 5:43Ryan Sean Adams?

  Yeah, merge-tastic. All right. Bitcoin ratio, that's gotta be up on the week, obviously.

• 5:50David Hoffman?

  Yeah, up 7.8% on the week, up to 0.085. Ryan, do you know what that means?

• 6:00Ryan Sean Adams?

  I bet it is the highest we've been in a long time, maybe in a year's time or so?

• 6:05David Hoffman?

  We are about there. I think we are matched at the highs of the 2021 bull market. It also means that one Ethereum is worth 53% of one Bitcoin.

• 6:15Ryan Sean Adams?

  You don't say.

• 6:17David Hoffman?

  Yeah, I do say, sir.

• 6:18Ryan Sean Adams?

  That's halfway to the flipping.

• 6:19David Hoffman?

  That's over halfway to the flipping. The ETH market cap is now greater than 50% of Bitcoins.

• 6:24Ryan Sean Adams?

  Ah, what happens? Did we unlock an NFT when that happens?

• 6:28David Hoffman?

  No, I just get really excited.

• 6:32David Hoffman?

  Because after like white knuckling my ETH BTC down to like 0.05, it's nice to have it recovered and then be in the green up to 0.085.

• 6:41Ryan Sean Adams?

  David, my friend, you're still trading ratios. I thought the DPI ETH would have like just destroyed you on ratios from now on.

• 6:49David Hoffman?

  That was only once. This ratio is working out. This ratio is working out. And there's a reason why. We'll talk about it later in the show.

• 6:54Ryan Sean Adams?

  Well, it probably has to do with the merge, but we'll get into more details. How about the total crypto market cap? We above or below a trillion?

• 7:01David Hoffman?

  Yeah, we're above a trillion. Last week, we're at 1.01 trillion. We are now at 1.025 trillion. So, small but healthy gain on the total crypto market cap.

• 7:09Ryan Sean Adams?

  Okay.

• 7:10David Hoffman?

  Which is interesting that the crypto market cap is up, yet Bitcoin is down.

• 7:14Ryan Sean Adams?

  Yeah.

• 7:15David Hoffman?

  That divergence does not happen often.

• 7:16Ryan Sean Adams?

  That doesn't happen often. That's really fascinating, actually. How about ETH gas prices? So, what we want to know is going in the merge, is are we going to be deflationary post-merge? Are we burning more ETH in the form of gas fees? Or are we inflationary? Is the money actually ultrasound, David? What are we looking like?

• 7:39David Hoffman?

  And so, okay, so this is actually something that we have to correct basically all times we've ever reported on gas, because I've been using that total gas distribution chart, the chart further down, and just like looking at the peak and seeing...

• 7:50Ryan Sean Adams?

  You've been looking at this median?

• 7:52David Hoffman?

  Nope, nope. Keep going up, up. You went right over it. There. The green one on the top right, the weekly gas distribution. I would just measure the peak, and that's how I would report it. But the peak is not the average, and the peak is actually lower than the average. And so, what we've actually been reporting is the median, the middle number, but we're not reporting the average. And so, for the month, for the last 30 days, here are the new numbers. The new numbers are in. The last 30 days, the median has been 14 GUE. The net average of gas prices over the last 30 days has actually been 18 GUE, and that is the more accurate number when it comes to the ETH burn. And remember...

• 8:33Ryan Sean Adams?

  That's the average.

• 8:34David Hoffman?

  The average. The average, yes. So, the average is 18 GUE, and the ultrasound barrier is 15. So, according to last month, we will be ultrasound by the time we go into the merge.

• 8:46Ryan Sean Adams?

  That's great. Unless block space demand goes down, but you can't imagine it going down too much.

• 8:53David Hoffman?

  Can't go down too much more. Yeah.

• 8:55Ryan Sean Adams?

  So will our very first, will our very first blocks be ultrasound or not? It's looking like right now they will be.

• 9:01David Hoffman?

  I think that, well, I think they certainly will be because there will be hella activity anyways because of the merge. It's really just like, are we going to sustain that ultrasound this and like, it's close. We're hanging on by like our fingernails, but like, it looks pretty, looks pretty ultrasound to me.

• 9:12Ryan Sean Adams?

  All right. For the last time, we're going to look at the merge estimator date. I know we'll get into the schedule a little bit later, but what is the projected date of the merge? Date and time of the merge right now for next week?

• 9:25David Hoffman?

  Thursday, 8 a.m. Eastern time on Thursday, Thursday morning, Eastern time. Sorry for the Pacific coasters. You might still be asleep. You'll have to get up early to watch the live stream. Not too early though. But yeah, 8 a.m. Eastern time.

• 9:39Ryan Sean Adams?

  It feels perfectly reasonable. Now, that could still move up. It could still move back, but it could also still move up, but 8 a.m. Eastern, I have no complaints.

• 9:47David Hoffman?

  I have no complaints. Yeah.

• 9:48Ryan Sean Adams?

  It's gonna be good. Good morning. So.

• 9:49David Hoffman?

  Sorry, sorry, Pacific coasters.

• 9:51Ryan Sean Adams?

  We'll get to the, we're doing a lot that week, of course. Bankless is doing a lot. The Ethereum community is doing a lot, so we'll give you the schedule a little bit later after we get to the market section. But we still got more market stuff to cover. David, you unlocked this fantastic visualization of ETH price at staking deposit time. What are we looking at and what is this telling us?

• 10:10David Hoffman?

  Yeah, this came from a fantastic Twitter account, data underscore always, which just is some really fantastic data analysis of blockchain stuff. And there's always, there's been this argument that like the ETH supply overhang and like, or the ETH unlock when we finally unlock is like bearish, because that means everyone's going to dump all their ether. And I just think that this argument is like totally overstated.

• 10:29Ryan Sean Adams?

  Wait, recap real quick, what happens there for people who have forgotten?

• 10:33David Hoffman?

  So, okay, if you are staking ether on the beacon chain, that there are no withdrawals. And so it's a one-way street. Once you deposit and begin staking ether, that's the only thing you can do. You can't get your ether back. That is, continues to be true post-merge. So we merge and that is still true. We need to do another hard fork to enable withdrawals predicted something like six to 12 months out after the merge. And then people will. unlock and people will fear that there's just this pent up demand to sell ether because there's been like this massive staking event where people can't get liquidity on their ether. And I think that this is overstated. And so the, I mean, granted, there it will like, there's a supply of ether. There's like 13, 14 million ether that has not been able to be sold.

• 11:16David Hoffman?

  But if you have to really ask your question, who are these people that are staking on the beacon chain? And especially the like, the most credible fear is like this 500 to $700 range where people began staking their ether. Very, in the very, very beginning, December of 2020, when the beacon chain launched, or January 2021, when ether price was still cheap. If you remember, Ryan, January 2021 was when ether went and broke like $1,100 and then started, it's sent basically up to $4,000 in May. So people staked in December and January, when ether was still like cheap, you know, 500 to $700 and a lot of ether became staked. Who are those people that are going first through the door into an unknown technology with an unknown stake to lock up time? Just to get like six

• 12:01David Hoffman?

  60% yield on your ETH. It's permabulls. It's probably, and it's not like they deposited all of their ether. They probably deposited like less than 10% because they're, you know, ether permabulls that have been here through the pre-sale. These people are not sellers. And also for the remainder of like the ETH deposits, if you're somebody who's itching to get liquidity on your ether, you probably staked with Lido, which launched the same time as the beacon chain. And that's all of the blue bars you see here on the visualization. That's all Lido deposits. And so that ether is actually liquid. And so a majority of ether that's been deposited, other than that first cohort that came in between 500 and $700, is actually underwater. So they're actually like, you know, underwater in terms of their ETH time of deposit, not necessarily when they bought it.

• 12:46David Hoffman?

  And so like this whole like, oh, there's going to be this mass unlocking event and like, it's going to flood the marketplace, I think has been totally overstated.

• 12:52Ryan Sean Adams?

  And you're saying that because you're seeing a lot of this who are like below current prices. They staked below current prices. A lot of the ETH that's

• 13:02David Hoffman?

  And even that, I just don't think the people who are like willing to take the lockup time are people that are inherently itching to sell their ether. These aren't like flimsy paper handlers.

• 13:12Ryan Sean Adams?

  Well, you know, it's funny though. So I, I agree with that. And I think that's a like a valid take. You know, it's funny though, is I know a number of ETH bulls who still haven't staked very much either. In fact, I would count like probably yourself and myself among those like I know we've

• 13:26David Hoffman?

  We have our stake with Rocketpool, but like my personal stake, I'm like I have my Ether and then I have my DGEN and my DGEN supply is trading the ratio right now.

• 13:35Ryan Sean Adams?

  Right, I've got some stake stuff, but I have been also been waiting for it to be de-risked ironically until like after the merge. We'll see how the merge goes, David. And then like, so yeah, it's, it's, it's interesting. It's certainly complex. By the way.

• 13:49David Hoffman?

  De-risk the Hillary Clinton risk?

• 13:51Ryan Sean Adams?

  You are having a debate with Jordy on this. I think the episode for, for listeners will come out.

• 13:59David Hoffman?

  It'll be live, live tomorrow.

• 14:00Ryan Sean Adams?

  It'll be today by the time you listen to this, right?

• 14:02David Hoffman?

  Right.

• 14:02Ryan Sean Adams?

  Isn't that what we're doing?

• 14:03David Hoffman?

  Yes, correct.

• 14:04Ryan Sean Adams?

  So David will debate Jordy on this very topic and you can catch that on the Bankless Podcast YouTube as always. What's this, David?

• 14:12David Hoffman?

  Just one last amount of revenue for the miners. Ethereum miners made $756 million in revenue in August ahead of the merge. It's the last time we'll see that headline. This is the last amount of like revenue for the miners. They get two weeks in September. But all of that will be largely deleted.

• 14:33Ryan Sean Adams?

  Good night, sweet prince. That's it. That's it. That's it for the miners. They are now retired.

• 14:38David Hoffman?

  Yeah, I mean, a lot of them have to retire. There is not, there's not sufficient proof of work chains that can support GPU miners to support that entire industry.

• 14:47Ryan Sean Adams?

  I think some of the miners have been stacking their ETH in order to stake, but others haven't and they'll just move on to greener pastures and other proof of work networks. David, let's talk.

• 14:57David Hoffman?

  Not very green, Ryan. Sorry.

• 15:00Ryan Sean Adams?

  Some red ones. Let's talk about the general markets in the macro side of things. So first, let's start with the S and P. This is a tweet from Charlie. Charlie Biello.

• 15:14Ryan Sean Adams?

  Bilelo. Bilelo. This is a tweet from Charlie Bilelo. The S and P 500 is down 17.7% in the first 169 trading days of 2022. The fourth worst start, the fourth worst start to any year in history. So S and P down on the year. Justifies an oof. Yeah, definitely. So that's what we're looking at. But I think that the more broad thing in macro that we should probably be thinking about right now is European energy markets and its effect on monetary policy. This is a great tweet thread from our friend Jim Bianco that kind of explains this. You want to run us through this?

• 15:52David Hoffman?

  Yeah, he goes, Jim Bianco says, "The bottom line, Europe is in an intolerable position and the public is getting angry and it's not even cold yet." Because of course, energy is how people stay warm during the winter. And so Jim Bianco continues and says, "Natural gas is used for power generation and space heating and is highly seasonal. Storage of natural gas is filled in the summer and rundown in the winter for space heating." Like they stock up their reserves during the summer when people don't need natural gas as much and then they consume that in the winter. Currently, storage facilities are at 81% full, about the middle of what you would expect an average. Like this is about a normal amount of being full at this point in the year. Jim continues and says, "Too many have pointed out to the chart above and proclaimed that

• 16:35David Hoffman?

  there is no problem, but this neglects the fact that it has cost a lot to fill these facilities. And as this chart that we're showing here says, European natural gas prices are soaring even after this week's decline. And so, yes, the reserves are acceptably full, but it's being, it's costing way more this year, like three, four, or five X times what it would be last year. Consequently, the cost of filling the storage has already cost, yeah, 6.5 times the still storage in any other full season. They have the storage, they have the supplies, but they paid bigly for it." And this cost has already happened will be borne by the European population because of soaring energy bills or through some form of taxation or bailouts.

• 17:19David Hoffman?

  And then they, he continues and says, also note the natural gas storage detail above only covers about 25 to 30% of winter natural gas needs, meaning they will have to sip their energy straight from the pipeline in addition to their storage. So it only solves up to like 30% of the actual problem. So Europe still needs flows from Russia this winter. And before the Ukraine war, Germany got about 55% of its gas needs from Russia, and this has certainly lowered somewhat during the recent months, but gas flows from Russia are down more than 75% from a normal flow. Note, this is a largest part of the Nord Stream being constrained. According to Jim, the Nord Stream pipeline will continue to be constrained,

• 18:01David Hoffman?

  because that's the whole strategy from Putin right now. And Jim Bianco continues and says, make no mistake, Putin knows all this, which is why he is trolling Europe with leaks requiring a shutdown of Nord Stream for an unspecified period of time. So Putin is basically shutting down Nord Stream, saying, just on the play, that this is going to make things really painful for Europe. Of course, this, none of this should be a surprise. Putin gave a speech in June saying that he was going to do this. Now he's actually doing it. And so what does all this mean? Europe has all the gas it needs as long as they're available to drain their bank accounts for it, says Jim Bianco. So TLDR, there is adequate natural gas reserves. It was really expensive. It only solves 30% of the problem, and that remaining 70% of

• 18:46David Hoffman?

  that problem is going to be expensive even further. And so how are they going to pay for it? Some form of money printing, some form of bailouts, some form of taxation, but it's not going to be pretty either way, is I think the summary of this thread.

• 18:57Ryan Sean Adams?

  Yeah. And what's interesting about that, as it affects monetary policy, is of course, energy bills, they're soaring for average business owners and average citizens. That means everything else gets more expensive. And so there've already been some government interventions. So the UK is deploying some price caps on energy contracts, but the bills across energy have been, utility bills have been soaring. Nonetheless, Italy is approving new aid packages. We've seen similar aid packages in Germany. And the one in Italy is, you know, $12 billion in government funding to help shield firms and families from surging energy costs. And so I think what we're going to see across all of Europe is essentially

• 19:40Ryan Sean Adams?

  the government has to deploy policies and deploy funds, stimulus funds, to help consumers and help businesses pay for these energy costs. And where's that going to come from? It's not from additional tax revenue, very likely. It's mostly going to be in the form of money printing, and they're doing this with the backdrop of inflation continues to heat up, too.

• 20:04David Hoffman?

  Right.

• 20:04Ryan Sean Adams?

  And so they are cutting checks to people to help them pay for their energy needs. Yet at the same time, the European Central Bank, just last week, raised rates by 75 basis points in order to tackle soaring inflation. So it's this like rock and a hard place that central banks and governments are trying to manage, and it's a very difficult place to be.

• 20:28David Hoffman?

  Yeah, and like, I don't know if this is bullish or bearish. It's bullish because money printing means asset prices go up. It's bearish because people are like struggling, and that's never good. And that can result in many different things, like people are burning, burning their bills and like protesting, paying their energy bills. Like, so it's just like, I don't know whether it's bullish or bearish, but it's definitely chaotic, and chaotic makes me scared. Markets don't like chaos.

• 20:50Ryan Sean Adams?

  You know, speaking of chaos, so I read this great post this week and from Arthur Hayes. Yet again, Arthur Hayes, right, writing it up. And we had Arthur on the podcast earlier this week, too. So guys, if you haven't tuned into that episode, it's a fantastic episode. He's talking all about the merge trade. But maybe I could just, because I know you haven't had a chance to read this, David, but let me just like summarize it for you, because I think it's super valuable. Basically, Arthur is saying, we're in wartime right now. People don't know it, but we're actually in wartime. And it's not, not talking about the Russian-Ukraine conflict, although that is a source of kinetic war. He's talking about economic war between Russia and China

• 21:31Ryan Sean Adams?

  and the US and the EU. And so his, his central thesis for this article is like, we're in economic war. Wars could escalate in various ways, but at least acknowledge we're in economic war. We were also previously in, in a war against a virus, in a COVID war.

• 21:46David Hoffman?

  Right.

• 21:47Ryan Sean Adams?

  And so we And we saw, we saw all sorts of restrictions and money printing as a result of that. So the tale of the 2020s has so far has been kind of like war. Economic wars. Right? Economic wars and wars against viruses and COVID. And what happens during war when you look at it historically? Well, two things happen. Inflation, which we've talked about a lot. But the second, which is somewhat interesting, is capital controls. And the reason nation states, flags, as Arthur calls them, put capital controls in place is so that their citizens can't get out of the inflation so that we're all kind of in it together. If we are going into an economic war or total war mode, then all of the citizens need

• 22:31Ryan Sean Adams?

  to be united and spend whatever is necessary in order to help the government and help the people, help the nation win the war. And so the very first thing that nations do when wartime gets worse is they impose capital controls and sanctions. And so we saw just glimmers of that, I think, during COVID. We're seeing a bit more with the Russian economic sanctions. But Arthur goes through history and talks about times where it's gotten a whole lot worse. And this, I think, is an interesting piece of history that I would personally like to study a little bit more. And maybe we can do a bankless episode on this in the future. But let's take the US in World War II.

• 23:16Ryan Sean Adams?

  Did you know that before World War II, so this is during the Great Depression, FDR put in place a Emergency Banking Act in 1933 that essentially meant a gold confiscation? So the problem was citizens at that time were trying to escape from inflation, from other economic wars, by taking their assets and putting it in coins, bars, gold certificates. And FDR basically made that illegal. You couldn't exit the existing fiat system through a store of value like gold anymore. And did you know that

• 23:58Ryan Sean Adams?

  Gold, private citizens, American citizens owning gold was actually illegal until December 1974. So this was like a, you know, a capital control that lingered. And this is in the US, which they came out of the depression like fairly strong. They actually won World War, World War II. If you look at other countries like, you know, Germany, for example, and Japan, the capital controls were far more severe.

• 24:24David Hoffman?

  Right.

• 24:24Ryan Sean Adams?

  There was no way for the average citizen to actually escape. And so Arthur is kind of adding these things up. Like we're in kind of this early wartime period. Things could get worse. They may not, right? Like hopefully probabilistically, you know, things will end up okay, but they could get worse. And when they do, expect inflation and then also expect capital controls. And his overarching point toward the end of the article is basically this. The time to escape from the fiat system is not after they put the capital controls in place. So it's basically the time to buy assets, non-inflationary assets like Bitcoin, like Ether in the digital mode. Maybe like other things, if you think these are.

• 25:08David Hoffman?

  Real estate, yeah.

• 25:10Ryan Sean Adams?

  Maybe, or like that can be capital controlled very well by the nation state. Ideally, you want to kind of exit the system entirely. And so you're not dependent on the existing banking system. The, the, the time to do that is now, is his point. And yeah, I, I guess some dark thoughts this week, like as I was thinking about all of these things, but I think he's absolutely right.

• 25:30David Hoffman?

  And the big, basic calculus as to like what happens during fiat currencies during wartime, right? Like wartime is destruction, like capital gets destroyed. Like we spend capital to build a tank, that tank goes to war, tank blows up, that capital gets destroyed. Fiat money, which paid for that tank, becomes like printed and inflated to move atoms. And what is ultimately war is like, it's a fight over the way that the physical world looks. And so people like governments are using their fiat currencies as like the ultimate like power that, that creates and supports and directs the resources of a world, an army. And when two armies are going at each other, like what? What happens is that ultimately, the most downstream net effect of war is that inflation

• 26:12David Hoffman?

  happens. And so like destruction creates inflation. And so, and why there's capital controls is like the nation state is like, yo, we are all in this together. Y'all can't sell your dollars because we need to sell the dollars to pay for war. And so you guys can't sell dollars, only we can sell dollars. And we sell dollars by minting dollars and then selling them. And so like, you know, usually this works when the populace is behind the effort. This is like, you know, buy war bonds in World War II. And people like, okay, I'll buy war bonds. You know, my, my son is going to war. I feel really scared for his life. How can I help? I'll buy war bonds.

• 26:47Ryan Sean Adams?

  Yep.

• 26:48David Hoffman?

  Ryan, I don't really think the populace of today is in that kind of sentiment to buy war bonds.

• 26:53Ryan Sean Adams?

  Certainly not now.

• 26:55David Hoffman?

  Certainly not now.

• 26:55Ryan Sean Adams?

  And like, like, like Arthur goes through the kind of the return on investment of, of war bonds, basically, even for the US who actually won the war. And this is like negative forty to sixty percent.

• 27:04David Hoffman?

  Right.

• 27:04Ryan Sean Adams?

  If you actually bought the war bonds.

• 27:06David Hoffman?

  Right.

• 27:06Ryan Sean Adams?

  You lost money in real terms.

• 27:08David Hoffman?

  Some people lost lives, some people lost money. It was a group effort.

• 27:11Ryan Sean Adams?

  Yeah. So anyway, very interesting. But I, I think that people have to start thinking, we have to start thinking about fiat currency and what it actually is. And it's actually just a form of short-term debt.

• 27:23David Hoffman?

  Yeah.

• 27:23Ryan Sean Adams?

  To the government. You're lending money to the government in exchange for your hard assets, like commodities, like energy, essentially. We're starting to see that in Europe play out.

• 27:31David Hoffman?

  Anyways, back to the merge.

• 27:32Ryan Sean Adams?

  Back to lighter news. What's coming up next, David?

• 27:35David Hoffman?

  Coming up next, the merge. Did you know it's happening next week? I hope you did, because we talked about it earlier in this episode, and last week, and the week before that. But it's actually next week. So we're going to talk about the merge schedule, what you need to know, what you need to do, all that stuff. Binance, rugs, all non-USD stable coins. But it's a good thing? We'll figure out why. And lastly, Coinbase proposes something big to Maker Dow. This is unrelated to how Coinbase is also suing the Treasury. We're talking about all of these things and more. But first, a moment to talk to some of these fantastic sponsors that make this show possible. Rocketpool is your decentralized Ethereum staking protocol. You can stake your ETH in Rocketpool and get our ETH in return, allowing you to stake your ETH and use it in DeFi at the same time. You can get 4% on your ETH by staking it with Rocketpool,

• 28:19David Hoffman?

  but you can get even more by running a node. Rocketpool is the only staking provider that allows anyone to permissionlessly join their network of validating Ethereum nodes. Setting up your Rocketpool node is easier than running a node solo, and you only need 16 ETH to get started. You get an extra 15% staking commission on the pooled ETH that uses your node to stake. You also get RPL token rewards on top. So if you're bullish ETH staking, you can boost your yield by adding your node to the decentralized Rocketpool network, which currently has over 1,000 independent node operators. It's yield farming, but with Ethereum nodes. You can get started at rocketpool.net, and you can also join the Rocketpool community in their Discord. You can find me hanging out there sometimes in the chat, so I'll see you there. MakerDAO is the OG DeFi protocol, the first DeFi protocol to ever exist, even before we called it DeFi. MakerDAO produces DAI,

• 29:04David Hoffman?

  the industry's most battle-tested and resilient stablecoin. Using Maker, you don't need to sell your collateral if you need liquidity. Instead, you can spin up a Maker Vault and use your collateral to mince DAI directly. With Maker, the power to mince new money is in your hands. And there's something new in the MakerDAO ecosystem. Every time a new MakerDAO is opened, the owner can claim a PoW, which contributes funds to One Tree Planted, an organization with ongoing global reforestation efforts, creating a world where digital participation and the health of our environment can live side by side. Soon, Maker will be present on all chains in Layer 2s, bringing the biggest and best DeFi credit facility to everywhere there is DeFi. So follow Maker on Twitter, @makerDAO, and learn from the oldest and most resilient DAO in existence. Ryan, the last hard fork before the merge happened. It's called Belltricks.

• 29:49David Hoffman?

  It happened last week. It's activated. There are now zero more steps between where we are now and the Ethereum merge. The next thing to happen on Ethereum is the merge. And the merge is happening next week, September 15th, Thursday morning. Is that September 15th? Yes. Yes. Uh, September 15th, Thursday morning, 8:00 AM Eastern Time, 5:00 AM Pacific Time, later in European times. But that's what's next. The merge. The merge is next.

• 30:18Ryan Sean Adams?

  Okay, so Bellatrix being the last hard fork before the merge. How did that go, David? Can you go over that with us?

• 30:24David Hoffman?

  It went super, super well. Here is a tweet thread from Christine Kim, who's live tweeting as Bellatrix happened. And then, so some quick stats that she put forth. Network participation rate, 97.8%. Active validators, 420,000. Offline validators, 1,100. That number can be expected. And then also here is just like a quick cheat sheet of client diversity. Everything is below 51%. That's good. We could still get Prism down, but it's not really going to stop us from doing anything. And then Bellatrix happens. And as the other side of Bellatrix, every hard fork, you'll lose people that aren't ready. And 95% of people hard forked with the Bellatrix update.

• 31:08David Hoffman?

  And so like, you know, if we saw 95% with the actual merge, that would be fantastic. So 94.94%. And so a few, so the 11,000 offline validators jumped up to 17,000. But you could imagine these people just like didn't update their nodes. All they have to go do is download more software, fix something, you know, unplug it, replug it in, something like that.

• 31:28Ryan Sean Adams?

  Is this right? Number of active validators, 403,000?

• 31:32David Hoffman?

  Mm-hmm. Correct. That is the beacon chain validators, yeah. Not unique numbers of computers, but like 403,000 unique instances of 32 Ether, which is one validator, of course. And so 94.94% succeeded. And like, all we need, Ryan, is 66%. All we need is 66% for it to be a flawless merge. And we had 94.94%.

• 31:57Ryan Sean Adams?

  Well, in my school, growing up, 94% was an A.

• 32:00David Hoffman?

  And even if it was below 66%, all it needs is like 24 hours to get above 66%. So it's not like this one moment, we need to be above 66%. We just need to get to 66% like soonish.

• 32:13Ryan Sean Adams?

  Is this what the merge is gonna look like? I'm looking at a meme here. It's just a guy staring at his computer and then like he's got a serious face and then he's got a little celebratory thing.

• 32:20David Hoffman?

  It is like this naturally like anticlimactic thing of this like invisible software just like changes.

• 32:25Ryan Sean Adams?

  It's not going to be, not this time. We're gonna make it fun on the social layer. But yeah, I mean, like it's just code, I guess, in the background. Not a lot's happening. What's this tweet saying, David?

• 32:34David Hoffman?

  Yeah, this is Adrian saying Belltricks looking good so far. Again, this is moments after the merge. Definitely some people who didn't update, probably around 5% turned out that was right. But money at stake, we should see that get fixed up pretty quickly. So Belltricks, the update doesn't actually mean too much. Like you go offline if something's bad, but you get the leakage response. Like because there's, because there's money at stake with the merge, then there is money at stake with Belltricks because it was the beacon chain. But like this is why this has such a good success rate and why even if like-

• 33:03Ryan Sean Adams?

  It repairs fast, it heals fast.

• 33:04David Hoffman?

  It repairs so fast because there's financial incentive. Unlike all previous test nets, which is like, yo, we're gonna do a dry run. There are like, you know, ticket paying audience members in the theater waiting to see the merge. And so like you don't mess up then because there's incentive.

• 33:18Ryan Sean Adams?

  You're losing ETH every few minutes, right?

• 33:21David Hoffman?

  Yep.

• 33:22Ryan Sean Adams?

  This is getting some exposure in mainstream. I've seen a number of articles. This is an article from The Economist about the merge. The title is "The Future of Crypto Is At Stake in Ethereum Switch." A lot of these articles, David, they're pretty surface level, but they're also pretty good.

• 33:38David Hoffman?

  Yeah, and they're also about energy, obviously. They're like, oh yeah, like look at that subtitle, can decentralized networks reform themselves? As in like repent for their energy consumption. And like there's always been like, they're not gonna talk about ultrasound money, they're not gonna talk about Ethereum's deflation, they're talking about how Ethereum is gonna go green.

• 33:56Ryan Sean Adams?

  That's all right. They gotta leave some space for us to talk about. The Economist can't steal our content. Come on, guys. I like, I think a lot of people are also wondering whether a proof of work chain will remain. And I think people are just curious, like if I have some ETH, will I get a free fork? They've maybe received a fork funds in the past and there is talk of Ethereum proof of work fork that could be happening. What are- We're looking at right here on CoinGecko. I think the chart we have pulled up is for an asset called the Ethereum Proof of Work Fork IOU. What is this thing?

• 34:31David Hoffman?

  Yeah, this is basically a tokenized future of the Ethereum Pao chain. Ryan, I want to say this extremely clearly. I've said it all the other times on this show. I think listeners should expect getting $0 from the ETH Proof of Work Fork. I think this is a game that's being played by traders who are trying to meme this thing into existence. I think people who are positioning themselves to capture that ETH Proof of Work token are going to find themselves receiving roughly $0 from this trade.

• 34:57Ryan Sean Adams?

  Unless they're super fast.

• 34:58David Hoffman?

  Unless they're super fast and sophisticated and playing this game.

• 35:01Ryan Sean Adams?

  You're talking about like just normal retail traders.

• 35:03David Hoffman?

  Normal retail traders, right. I don't think there's going to be this brand new like Proof of Work chain that spawns off and like you see, you see extra Ether show up in like a different wallet. Like it doesn't make any sense. I can go to the reasons why, but it would just be me ranting for like 10 minutes.

• 35:19Ryan Sean Adams?

  I know here we're looking at kind of a futures market, right? So this is, you know, but it's, it's about like 2 to 3% or so, the price of ETH right now.

• 35:27David Hoffman?

  It's $31 for one Proof of Work Ether as opposed to the current price of Ether, which is $1,632.

• 35:33Ryan Sean Adams?

  And this is one hypothetical, right? It doesn't even exist yet. It's hypothetical. But you know, another way to look at this, of course, is to look at the liquidity on this. We're talking just such low liquidity, right? 24 hour volume of, you know, 350,000.

• 35:46David Hoffman?

  It's not nothing. It's not zero.

• 35:47Ryan Sean Adams?

  Not nothing, but it's kind of a lowish cap. You know, DeFi token would have something similar. So don't expect it. It could happen.

• 35:56David Hoffman?

  It could happen.

• 35:56Ryan Sean Adams?

  Here's the thing. We'll answer some questions. I think we had a lot of questions this week about, what do you do in case you want to receive a hypothetical ETH Proof of Work coin? Is there anything you have to do in case that happens? The good news is not too much.

• 36:10David Hoffman?

  A hypothetical scenario that it happens, yeah, we'll talk about it.

• 36:13Ryan Sean Adams?

  David, do you not want this to happen?

• 36:15David Hoffman?

  I just don't think it will. Like, okay, I'm going to speedrun this. Like, how are these, how are these users going to access this chain? Are they going to update their RPC endpoint in Infura? Somebody, Infura is going to have to accept it, which means they're going to have to run their own node that connects to the Ethereum non-Proof of Work chain, which means they're going to download old. Consensus software, like there's gonna have to be a client for this thing. Like, people are gonna have to, where's all the infrastructure?

• 36:41Ryan Sean Adams?

  If they have their funds in like, you know, Coinbase and exchange, Coinbase would have to obviously like, release it to them. There's a lot of stuff.

• 36:47David Hoffman?

  Poloniex is going to do that, but if just one exchange services this like service for people, it's not anything.

• 36:54Ryan Sean Adams?

  This does feel different than previous forks that we've seen, which actually had some traction, like Ethereum Classic for one, had some traction. But even in the Bitcoin world, Bitcoin Cash, it was like Roger Vares.

• 37:03David Hoffman?

  It's contentious forks.

• 37:06Ryan Sean Adams?

  Yeah, we've got a developer community, like no one, no community is rallying around the ETH proof of work thing.

• 37:12David Hoffman?

  Other than the miners, and the only reason why the miners are rallying on it, because they want to dump on you, because that's their business model.

• 37:20Ryan Sean Adams?

  All right. Well, yeah, I totally see the point. So don't expect any free bucks. I wish, I wish we had better news for you, but you know, if you do see that token, maybe like, you know, sell it real quick.

• 37:29David Hoffman?

  Yeah.

• 37:30Ryan Sean Adams?

  Before everyone else does. You know what's kind of bullish about this though, David? And this is really good to see, is the at-home staking community.

• 37:38David Hoffman?

  Hundred percent.

• 37:39Ryan Sean Adams?

  Shout out Solo Stakers. What are we looking at, David? I know we've got a bunch of images lined up.

• 37:44David Hoffman?

  Yes, SuperFiz, who's just a fantastic community member of the Ethereum community, just really focused on proof of sake, the merge, and also just fundamentally bullish on stake from home. He started this whole stake from home meme, and I found all of these tweets because he retweeted it. So just shout out to SuperFiz. And this is just like this hozpodge group of people who like live at home, and they're staking at home, like, look at this mess, look at this absolute absence of cable management while this person.

• 38:09Ryan Sean Adams?

  Wait, where's the staking node?

• 38:10David Hoffman?

  It's that little black square. It's a little black square right there, connected to the router, like with a tiny ass keyboard that doesn't even like.

• 38:17Ryan Sean Adams?

  This does not look like a data center.

• 38:18David Hoffman?

  This is not professional. This is just like amateur at-home staking. Here's somebody with like the panda sticker on their like Intel NUC, their NUC, those tiny little computers, running Rocketpool. Here's another one, like again, a stake at home, smaller than a pen, like we're gonna, we got like 15 of these.

• 38:36Ryan Sean Adams?

  Smaller than a pen.

• 38:36David Hoffman?

  Yeah, so like, here's another one connected to this battery.

• 38:39Ryan Sean Adams?

  Beefy.

• 38:40David Hoffman?

  Yeah, well, no, so that's the battery. It's the tiny little, it's the tiny little like. And the Intel machine that's up or up in the shelf.

• 38:46Ryan Sean Adams?

  Running out of a home office.

• 38:47David Hoffman?

  But it's on the battery in case like the power goes out. Uh, here, here's somebody having their tiny little computer, computer on top of their PS4. Next to their family photos, next to their baby, like their grandkid or kid or something. I don't know.

• 38:59Ryan Sean Adams?

  It's another child. My validator is my child.

• 39:02David Hoffman?

  Yeah. As here's one, it's a laptop, just like, you know, sitting on some shelves.

• 39:07Ryan Sean Adams?

  Laptop sitting in the basement. That's what this one looks like.

• 39:10David Hoffman?

  Yeah. Like here's, here's a nice like professional looking one, like very, very clean. Yeah. You can see this on our battle stations, maybe. Uh, here's one with like a stuffed dog next to it, like right next to like all their other server stuff. Uh, here's one sitting under a shelf, right next to somebody's modem with a fan on it to make it cool. Here's one with a post-it note that says, don't touch. This is daddy's.

• 39:30Ryan Sean Adams?

  Signed daddy.

• 39:31David Hoffman?

  Yeah. Kids, don't touch this. Uh, next to like some home server.

• 39:35Ryan Sean Adams?

  Uh, cause kids, if you do touch it, the family loses money. All right.

• 39:39David Hoffman?

  Right.

• 39:39Ryan Sean Adams?

  Don't touch dad's validator, please.

• 39:41David Hoffman?

  Here's like a custom made raspberry pi with like some ETH branding on it that somebody clearly just like put together in like a wood shop. Uh, you know, here's somebody like with their, again, like a very small box and Intel and UC thing. Uh, with like the little temperature monitor.

• 39:55Ryan Sean Adams?

  This is inside of a home entertainment system.

• 39:57David Hoffman?

  Yeah. Right. Next to their like home family TV and Xbox, right?

• 40:00Ryan Sean Adams?

  Yeah. Right. Right. Next to your like your fire stick.

• 40:03David Hoffman?

  Right. They got that little like monitor. Yeah. Like this is great. Like, uh, here's like somebody's like cooler, bigger one. I think this might be actually super physicist. Uh, here's one like baked into a shelf, just like built in. Right. So like that's their hue light mode and like they have it like hooked up to their shelf.

• 40:18Ryan Sean Adams?

  That is awesome.

• 40:19David Hoffman?

  Yeah, it is great. Here's Austin Griffith, you know, pointing behind him. This is his setup, of course. Uh, uh, here's one with like a Vitalik photo. Okay. So we're getting to the good ones here. This guy is, is staking in his mobile home. He has a full-size computer and he's in the force of Washington, staking mobily via satellite. Like, how are you, you're not even on the grid and you're staking.

• 40:42Ryan Sean Adams?

  He is off the grid.

• 40:42David Hoffman?

  He's off the grid.

• 40:43Ryan Sean Adams?

  This is like solar powered or something staking.

• 40:46David Hoffman?

  Uh huh. How crazy is that?

• 40:48Ryan Sean Adams?

  Not even connected in a campsite.

• 40:49David Hoffman?

  Amazing, amazing. Uh, and here's one, this guy has it in his kitchen up on top of his shelves.

• 40:58David Hoffman?

  And so like it's above his kitchen cabinets. And it's like, I just love how this is in this dude's kitchen.

• 41:03Ryan Sean Adams?

  Do you see what that mixer is?

• 41:04David Hoffman?

  There's the cuisine art, the kitchen like cuisine art that like somebody's making cookies with. Like, I'm sorry, you're not seeing this kind of stuff with professional proof of work miners. This is, in my mind, the reason why we can share all of these photos is because of what the purpose is of proof of work.

• 41:19Ryan Sean Adams?

  Yeah, tell us. So why does this matter? Is this just like hardware porn? Like, why are we even?

• 41:24David Hoffman?

  It's a little bit hardware porn, but it's the point is, is that Ethereum becomes as decentralized as capital and hardware, which are very fundamentally decentralized. And that was my take that I put in here. It's like, the reason why we can share these photos is because how Ethereum exists in people's homes. This is Ethereum by the people, for the people. Yes.

• 41:45Ryan Sean Adams?

  This is what decentralization looks like.

• 41:47David Hoffman?

  Right.

• 41:47Ryan Sean Adams?

  Scroll through it. It's like, run this from home. This is your check on the network. Where individuals have power over the network. They can fork out a change that they don't like.

• 41:58David Hoffman?

  You making just a little bit of money, four, five, six, seven percent on your ETH for just doing the network thing. Doing the ETH thing.

• 42:06Ryan Sean Adams?

  I thought you couldn't run a validator from home. I was told this.

• 42:10David Hoffman?

  I think a lot of listeners actually haven't heard that because the Bitcoiners who say that have just become more and more and more relevant.

• 42:15Ryan Sean Adams?

  Well, we have picture proof now.

• 42:16David Hoffman?

  Yeah.

• 42:18Ryan Sean Adams?

  What is this? From Jonathan Mann, of course, put together a nice song. Should we play it for people?

• 42:22David Hoffman?

  Yeah, Jonathan Mann is the Song of Day man. So of course, he sang a song about staking from home. So here it is.

• 43:45Ryan Sean Adams?

  All right, a lot to celebrate over Merge Week, of course, including Solos Stakers. But David, let's talk a little bit more about the stablecoin wars because Binance did a thing this week.

• 43:55David Hoffman?

  Did a thing.

• 43:55Ryan Sean Adams?

  They have stopped supporting USDC. This is, of course, one of the largest stablecoins in the world, second to Tether. USDC is kind of a Coinbase circle, American regulated bank, stablecoin type product. And Binance isn't having it anymore. Essentially, they have converted all of the USDC funds over to their own stablecoin, which is called BUSD. This is the Binance stablecoin. Similar product in a lot of respects, not as American regulated, certainly not a Coinbase product or a Circle product either. What's going on here, David?

• 44:28David Hoffman?

  Yeah, and it's actually not just USDC. It's also Pax Dollar and True USD. These are much smaller stablecoins, but all three of these stablecoins are just being swapped on the backend to BUSD. So if you had USDC or Pax or True USD deposited into Binance, congrats, you now own BUSD instead.

• 44:46Ryan Sean Adams?

  A different stablecoin.

• 44:47David Hoffman?

  A different stablecoin, yeah.

• 44:48Ryan Sean Adams?

  This is kind of like an analogy, I think, is if, you know, when you deposit funds into Wells Fargo, they're actually like dollar IOUs. They're Wells Fargo dollar IOUs, right? And if you deposit it into Chase Bank, they're Chase dollar IOUs. This is as if Chase Bank was holding Wells Fargo IOUs and they said, no more Wells Fargo IOUs, they're just all Chase IOUs now. It's kind of what's happening here.

• 45:12David Hoffman?

  Yeah, and like, no capital was lost because it's all one for one. It's all like kind assets. But just like, you know, the bankless take here is that bankless banks can do whatever they want with your money. Other banks throughout history like Central banks have said like, you know, $20 bills, no longer valid, just like that. This kind of feels a little bit like that, but at least no, no users lost their money. And actually, there are some huge proponents of this saying it's actually really, a really good move. Mainly because you can actually still withdraw USDC. So if you have doll, it's basically making all dollars on Binance homogeneous, which is actually a good move. Fully liquidity? Right. So like, yeah, so like you just now have Binance dollars, which is literally what it's called.

• 45:53David Hoffman?

  But if you want to withdraw USDC to Ethereum, they actually still give you that option. So like you deposit dollars into Binance, it gets turned to BUSD on the backend. Your Binance account, so it's like, okay, you credited this many dollars. And then you can withdraw those dollars and turn it into, what do you want to turn it into? USDC on Ethereum, DAI on like optimism, like true USD on Avalanche. Like it still lets you do that. It's just homogenizing dollars in the deposit side. This is actually very good for liquidity because like, rather than having like Bitcoin trade against USDC and BUSD and UST. It's just now it's just BUSD. So actually these order pairs actually get more liquid. Interestingly, they did not do this for Tether.

• 46:33David Hoffman?

  And I think that's because of the manual redeemability of Tether. I think this is the case. And so the take here is that it's a, it's a good UX upgrade for depositing stable coins, except for Tether. Tether gets a little bit left out here. And so there's a prediction here that says that this move leads to a gradual net share shift from USDT, Tether to Binance dollar and USDC. And this is also echoed by Jeremy Allaire, who is a supporter of this move by Binance. And so the argument here is that this actually cuts out steps for USDC users who want to trade on Binance. And so this is actually removing a step and still enabled everything that you could do before.

• 47:16David Hoffman?

  FTX actually already had this and built into their exchange. And so, but like this actually, this feature doesn't get embedded into US, into Tether, because Tether has this like T plus one settlement time. I'm a little bit hairy on the details, but that's the hot takes here.

• 47:32Ryan Sean Adams?

  Yeah, Jeremy Lehrer, of course, is the CEO of Circle, who would be, you know, very incentive to respond negatively to this if he felt it was negative to USDC. Yeah, I think it's, there's an element of this is news, but it's also kind of non-news. There's, there's also an element of like, rest assured, this is definitely, you'd say it's in Binance users' best interest, maybe from a pooled liquidity perspective, but it's definitely in Binance's best interest, right? They want to propagate BUSD. And what's interesting about this to me is, like, we're fine with centralized stablecoins. Like, the bankless position is, hey, they can provide some good UX, right? USDC, BUSD, whatever it is, but

• 48:13Ryan Sean Adams?

  we should also recognize their limitations. And these are effectively bank coins, sometimes on crypto rails, but they're issued by bankers. Both are fine, it's good UX, but neither of them are decentralized. And I do think that each bank, over time, of course, they're going to be biased towards their own stablecoin. The interesting juxtaposition, of course, is Ethereum is credibly neutral and biased towards neither. It cannot favor USDC, it cannot favor BUSD in any stretch. It's interesting when you consider, you know, something like the Binance chain, for example, you can very easily see that maybe favoring a Binance-centric stablecoin over another type of stablecoin. We're not going to get that on a truly decentralized

• 48:58Ryan Sean Adams?

  system like Ethereum. So, banks will be banks, they're going to play their bank games, and some of it will be good UX, and some of it will not be detrimental, but it's definitely not decentralized. David, speaking of banks, playing bank games. Speaking of banks. Coinbase and MKR, is Coinbase proposing some kind of agreement to the Maker community? What is this?

• 49:19David Hoffman?

  Yeah, Coinbase, the exchange, is making a proposal to MakerDAO, the DAO. And so they make this proposal for MakerDAO to take 1/3 of its USDC, which is about 1.6 billion. 1.6 billion is 1/3 of it, so multiply that by 3 and you get the total supply. Again, can't do math, listeners do that in your head. But Coinbase is proposing that 1.6 billion USDC in Maker's vaults be deposited into Coinbase to earn yield with Coinbase. And they are offering Maker 1.5 yield on their 1.6 billion USDC. And MakerDAO is currently getting 0% on that USDC. So this would net MakerDAO about $24 million in yearly revenue if they agree to do this.

• 50:01David Hoffman?

  And so some of the parameters here is that Maker will pay zero custody fees on USDC held by Coinbase Prime, so Coinbase isn't charging Maker for this. Maker Governance will be able to freely mint, burn, withdraw, and settle almost instantaneously in USDC less than 6 minutes, consistent with Coinbase's Prime standard offering. One of the reasons why this works is this is highly automated. And then the rewards from the USDC account with Coinbase will be calculated based on the weighted average of assets on the platform each month and paid out on the 5th business day of the following month. And so some takes are like, well, you're taking collateral that's backing DAI and you're giving it to Coinbase. Does that offer any sort of security risk or centralization risk? Rune responded to this criticism, saying, "From a regulatory, legal, and seizure risk

• 50:45David Hoffman?

  perspective, this proposal changes nothing because there was already centralization risk with USDC anyways." And also Circle and Coinbase are in bed together formally, they have a formal agreement. And so there's not additional risks here. Another community question came in, it's like, "Why not advocate to Ave or Compound? You would improve censorship resistance, reduce centralization risk, and it's less likely than a risk to a custodial service." And I guess actually the answer to this is exactly what I just said, USDC is already a centralized asset.

• 51:15Ryan Sean Adams?

  It's already custodial.

• 51:16David Hoffman?

  Right, it's already custodial, yeah. But also, it would nuke the yields inside of DeFi. And so putting out USDC into DeFi sucks up DeFi yields and they actually want that DeFi yield to actually go work for DAI. So they're using their USDC for Coinbase to get external yields. So it's actually going out and get getting external yields into crypto. Rather than just like having this internal circular economy where we're just like lending each other our stable coins. So that's that.

• 51:44Ryan Sean Adams?

  I guess it's interesting. A few maybe hot takes for me on this are like number one, isn't it cool? That a company like Coinbase is proposing a proposal on the Maker Governance forums?

• 51:56David Hoffman?

  That is cool. That is really cool.

• 51:57Ryan Sean Adams?

  Like, that's really neat. So I love that piece of it. And I also think, I mean, my other hot take is probably like. Coinbase is probably looking at some of the discussion around the USDC concentration in the MKR. Remember, we talked about last week, these factions. Of the Maker community and DAI and, you know, one faction wants to completely eject all centralized stable coins from the backing of DAI. And here's Coinbase coming in with a sweetener, 1.5% annual APY if you don't. And so that's interesting as well. So. Yeah, it's it. It's always fascinating, David, to see how all of this, you know, has evolved and, you know, Maker is a relatively new project, like five years old. Now here it's getting on the governance.

• 52:41David Hoffman?

  It's not new in crypto terms. It's new in global terms.

• 52:44Ryan Sean Adams?

  It's new. It's a new kind of like operation, new type.

• 52:47David Hoffman?

  It's new in the same way that crypto is early.

• 52:50Ryan Sean Adams?

  Exactly.

• 52:52David Hoffman?

  My hot take here is that.

• 52:53Ryan Sean Adams?

  What's your hot take?

• 52:54David Hoffman?

  This actually doesn't fit the protocol sync thesis. I always thought Coinbase would be depositing money into Maker DAO. Not making proposals for Maker DAO to deposit money into it. That actually seems inverted from what I would expect because this is like a protocol. Is on top of a centralized entity rather than a centralized entity being on top of a protocol. That's my hot take is like that actually didn't really fit my model here.

• 53:19Ryan Sean Adams?

  Yeah, it's I see that as well. It's interesting to ask, what actually is Maker?

• 53:25David Hoffman?

  Right?

• 53:25Ryan Sean Adams?

  Like, it's not quite a bank. It's not fully a protocol. What is it? It's some it's some kind of new thing in the middle. It's a DAO, I got a new sort of bank DAO. David, what's coming up next, though?

• 53:37David Hoffman?

  It's not the last time we're going to be hearing from Coinbase in this weekly roll up because they are also suing the Treasury Department. So go pop your popcorn once you're done with your coffee. And then also the ENS August numbers are in and they're hot because they've always been hot. So we're going to cover those numbers and more right after we talk to some of these fantastic sponsors that make the show possible. There is a brand new staking feature in the Ledger Live app today. We all like staking the assets that we're bullish on, and now you can stake seven different coins inside the Ledger Live app. Cosmos, Polkadot, Tron, Algorian, Tezos, Solana, and of course Ethereum. With Ledger Live, you can take money from your bank account, buy your most bullish crypto asset, and stake that asset to its network all inside the Ledger Live app.

• 54:19David Hoffman?

  Through a partnership with Figment, Ledger also lets you choose which validator you want to stake your assets with. And Ledger is running its own validating nodes, offering a convenient way to participate in network validation. And it even comes with slashing insurance. Ledger Live is truly becoming the battle station for the bankless world. So go download Ledger Live. If you have a Ledger already, you probably already have it and get started securely staking your crypto assets. The Brave browser is the user-first browser for the web3 internet with over 60 million monthly active users. And inside the Brave browser, you'll find the Brave Wallet, the secure, multi-chain crypto wallet built right into the browser. Web3 is freedom from big tech and Wall Street, more control and better privacy. But there's a weak point in Web3, your crypto wallet. And most crypto wallets are browser extensions, which can easily be spoofed. But the Brave Wallet is different.

• 55:03David Hoffman?

  No extensions are required, which gives Brave Browser an extra level of security versus other wallets. Brave Wallet is your secure passport for the possibilities of Web3 and supports multiple chains, including Ethereum and Solana. You can even buy crypto directly inside the wallet with Ramp. And of course, you can store, send, and swap your crypto assets, manage your NFTs, and connect to other wallets and DeFi apps. So whether you're new to crypto or you're a seasoned It's time to ditch those risky extensions and it's time to switch to the Brave Wallet. Download Brave at brave.com/banklist and click the wallet icon to get started.

• 55:33Ryan Sean Adams?

  It's still airdrop season, David. 1inch users on Optimism are receiving an airdrop of 300,000 OP tokens. In order to receive this, you had to be a highly active 1inch user on Optimism and you get a little airdrop bonus incentive in the form of OP tokens. Any thoughts here?

• 55:51David Hoffman?

  Yeah, this is just really the effort of distributing OP tokens to users of Optimism. Again, using crypto rewards you, at least it tends to. This one is unique, though, in the sense that 1inch already had an airdrop with a 1inch token. And they already had users on Optimism. I'm not really sure if this is actually like moving the needle of just like incenting usage of Optimism. But it is distributing OP tokens widely, which I guess is good. I'm actually left with more question marks on than than anything on this one.

• 56:26Ryan Sean Adams?

  I think the new like meta for airdrops is you got to be doing stuff on Layer 2. That is maybe one of the learning lessons from this, which is in order to get your next airdrop hit, you got to be active in a Layer 2 like Optimism or Arbitrum or like later ZK Sync, Gistarkware and others. So take note, my friends. Let's flip over to NFTs, though. Do you know Reddit? We talked about Reddit launching NFTs, except they're secretly not calling them NFTs for the Reddit community. And they are actually selling fairly well, David. Some of these NFTs are selling for over $2,000. And all of the ones that they've released so far have sold out, which is pretty fascinating, looking at some of the NFTs here.

• 57:10David Hoffman?

  This is just good adoption of Reddit. I'm loving where this is going. I want to see more. I want to see more. What's delivering more, though, Ryan, is the August numbers for ENS. So we've got the August numbers, 301,000 new dot ETH registrations. So minting new ENS names is still hot. That's $4.7 million in protocol revenue, of course, all going to the DAO. And we've got some unique new holders, of course, 34,000 new Ethereum wallets that are holding at least one new ENS name. And of course, like always, 99% of domains on OpenSea are being sold as ENS, because I don't even know what another like domain service provider is.

• 57:50David Hoffman?

  So, ENS numbers are hot. I think the 10K club, where like if you have an ENS number that is 0 through 9999, has like a floor price of 3, which is pretty good.

• 58:03Ryan Sean Adams?

  Really?

• 58:03David Hoffman?

  Yeah.

• 58:04Ryan Sean Adams?

  That's maintained. It wasn't just a blip, huh?

• 58:05David Hoffman?

  No, not just maintained, for sure.

• 58:07Ryan Sean Adams?

  That's funny to me that ENS names are like, they're the bear market NFT.

• 58:11David Hoffman?

  They really are.

• 58:12Ryan Sean Adams?

  They've become like, I saw them last week.

• 58:14David Hoffman?

  Converged on fundamentals, right? Like, these are non-speculative. These are totally gonna be around for the future.

• 58:18Ryan Sean Adams?

  Forget the JPGs. You can actually use a domain, like, ENS domain name for something.

• 58:22David Hoffman?

  Just text. No JPGs, just text.

• 58:24Ryan Sean Adams?

  But like, useful. I mean, like, you can use it to, like, name your ETH address, or like, you know, direct an IPFS website, or something like this. And you can't do as much with your JPGs. So, last week I saw they were actually exceeding the trading volume of Bored Apes.

• 58:37David Hoffman?

  Yeah, so the trading volume was 2,300 Ether in the last month. Bored Apes was at 2,120 Ether.

• 58:44Ryan Sean Adams?

  Oh, I'm the captain now.

• 58:47David Hoffman?

  9,000 ENS names have changed hands in the last seven days. So, not only are the ENS registrations happening, new ENS domains are coming into the world, but like, people are also just like trading them around too. It's crazy.

• 59:01Ryan Sean Adams?

  Bullish. I kept the ENS airdrop too, David. I don't know if you did, but you know.

• 59:05David Hoffman?

  I wasn't able to claim mine. Mine got burnt.

• 59:08Ryan Sean Adams?

  Oh, sad. You lost tokens?

• 59:09David Hoffman?

  I lost tokens, yeah.

• 59:11Ryan Sean Adams?

  This sounds like a...

• 59:11David Hoffman?

  But I don't have to pay taxes on them. That's what I'm claiming. If I can't claim the tokens, I can't pay taxes.

• 59:18Ryan Sean Adams?

  Somebody fact-check that for us.

• 59:20David Hoffman?

  I lost the private keys. If I don't have the private keys, I can't claim the tokens.

• 59:24Ryan Sean Adams?

  Well, if you said it in a podcast, it's 100% true. So, if any IRS agents are listening to this...

• 59:29David Hoffman?

  The IRS agent is like, okay, deduct $500 of dues paid by David Hoffman. Like, okay.

• 59:35Ryan Sean Adams?

  Yep, they're listening.

• 59:36David Hoffman?

  That's how taxes work.

• 59:38Ryan Sean Adams?

  One thing that remains bullish is NFTs for public goods. What is Trent doing here with the Protocol Guild in this NFT issuance?

• 59:46David Hoffman?

  Yeah, so the Protocol Guild is this guild that's really meant to provide things for the market, for the community that people might want, and then sell those things and then give that revenue to Protocol devs.

• 59:58Ryan Sean Adams?

  It's a bake sale.

• 1:00:00David Hoffman?

  Yeah, lemonade sale, bake sale, but Protocol devs, you know, development, funding development has always been like a problem in open source world and also with Ethereum. And so the Protocol Guild has gone after that problem. And so they are making NFTs with like, actually really just like big deal artists and those platforms. And so there's this whole like network around like producing some really cool NFTs. So like, while it seems like a bake sale, like, oh, like buy a cookie, send it. It's big. This is like, these are coveted NFTs. And so I think people are going to play the speculation game on these things.

• 1:00:31Ryan Sean Adams?

  Look at this, 120 Ethereum Core devs that this goes to.

• 1:00:34David Hoffman?

  Being funded, yeah.

• 1:00:34Ryan Sean Adams?

  Being funded. And that's amazing because guess why? Next week is Merch Week, David. It's because of these people.

• 1:00:41David Hoffman?

  Right.

• 1:00:42Ryan Sean Adams?

  It's because the Ethereum Core devs, they made it happen. And so now is a good time to celebrate them. You could do so by purchasing an NFT and the proceeds go to the devs via the Protocol Guild.

• 1:00:53David Hoffman?

  I've checked out some of the art on these things, both from like, some of it's not released yet, but you can just check out, because like, some artists are on board. Other artists haven't been revealed yet, but like, this is not just like a casual thing. This is like a big deal thing, like artists are coming, secret artists, blah, blah, blah. But like, the art of what has been revealed is pretty damn cool. Pretty damn cool.

• 1:01:13Ryan Sean Adams?

  Another way to commemorate the merch.

• 1:01:14David Hoffman?

  Participating in this, yes. Okay, ooh, yes, here we go. Okay, Victor Bunin out of Coinbase, he works at Coinbase Cloud, but definitely just like, deep in Coinbase says, "Today, we announced that Coinbase is funding and supporting a lawsuit by six individuals against the Treasury Department sanctions of Tornado Cash smart contracts, an open source piece of software. You can read more about the details here." So six individuals are suing the Treasury Department and Coinbase is footing the bill and basically coordinating everything.

• 1:01:41Ryan Sean Adams?

  Here we go.

• 1:01:41David Hoffman?

  Nice job, Coinbase!

• 1:01:43Ryan Sean Adams?

  Okay, okay, so this is basically...

• 1:01:44David Hoffman?

  Are you ready to rumble?

• 1:01:46Ryan Sean Adams?

  This is basically... So you guys know, because you've been listening to the roll up the last few weeks, Dave and I have talked a lot about tornado cash, the OFAC sanctioning of smart contracts. And the unconstitutionality of it, or the illegality of it, we've done a number of episodes about that with Jake Trivinsky. And the question is, okay, what is the crypto community going to do about it? And if you're an individual, right, with an ETH address, and your government has just told you, if you use tornado cash to try to keep your transactions private, you could go to jail for 30 years. What can an individual do about it?

• 1:02:21David Hoffman?

  How can you fight back?

• 1:02:23Ryan Sean Adams?

  Right. So now we have the infantry coming in. We have Coinbase stepping up and actually suing the Treasury Department on behalf of funding this.

• 1:02:34David Hoffman?

  Funding the suing of the Treasury.

• 1:02:36Ryan Sean Adams?

  Funding the lawsuit of the Treasury Department on the behalf of six plaintiffs. So six individual citizens like you and I, who are they are representing, and they are funding, they're paying the legal bills for these individuals. It's badass, man.

• 1:02:50David Hoffman?

  That's super Chad, super Chad of Coinbase.

• 1:02:53Ryan Sean Adams?

  Coinbase to do this. They don't have to do this. This is crypto native values, above and beyond, in my opinion. Pretty excited.

• 1:02:59David Hoffman?

  I don't know how much it's going to cost. I imagine a decent amount. But overall, I actually do expect this to be like EV, like expected value positive for Coinbase, because

• 1:03:08Ryan Sean Adams?

  From a brand perspective?

• 1:03:09David Hoffman?

  From a brand perspective, but also ensuring that Coinbase can integrate with other DeFi projects. Maybe they'll integrate directly with tornado cash. But if they stop the unwarranted regulation at tornado cash, then they're like free to like do stuff that's, you know, not so like ridiculous, like not so dubious as privacy, stuff just like, you know, good compound, AVE, Uniswap. It really just stops the progress of dubious regulations. So they don't have to fight it later.

• 1:03:37Ryan Sean Adams?

  So I think they're just thinking forward. Draw a line in the sand somewhere. Is that what you're saying?

• 1:03:40David Hoffman?

  Yes, exactly.

• 1:03:41Ryan Sean Adams?

  I mean, and this is where Coinbase is drawing a line in the sand. It's great. This is a blog post from Brian Armstrong, the CEO of Coinbase. This is not legal. This is Brian Armstrong, the CEO and co-founder of Coinbase. I always think things are stronger when they come from a co-founder. And the TLDR of this post is Coinbase is funding lawsuit brought by six people challenging the US Treasury Department sanctions of the tornado cash smart contracts and asking the court to remove them from the US sanctions list. The sanctions exceed Treasury's authority, harm innocent people, remove privacy and security options for crypto users, and stifle innovation. Well said.

• 1:04:16David Hoffman?

  Coinbase's legal officer told CNBC, "It sets a dangerous precedent if this code can be designated without any limits imposed by law. Any technology, any tool, or system could be fair game for also being banned." So this is what I was saying is like Coinbase, maybe Coinbase is cool with tornado cash being banned, but they know more than Coinbase than tornado cash. And so in order to protect their future business models, ones that might not be alive today, they are doing this. Thank you. Thank you, Coinbase. Well done.

• 1:04:43Ryan Sean Adams?

  Did you know, David, Alex dot ETH is actually one of the plaintiffs here.

• 1:04:47David Hoffman?

  Ah, Alex, great guy.

• 1:04:49Ryan Sean Adams?

  This is Alex dot ETH on Twitter. He says, "Today, I joined five of their plaintiffs in challenging the US Treasury's no-fact sanctions against tornado cash." A regular citizen, a Ethereum that known for a while in the space, just on Twitter and other places.

• 1:05:03David Hoffman?

  And that was in the Denver.

• 1:05:05Ryan Sean Adams?

  He's saying, "I did not take this decision lightly, being a plaintiff in the case." So this also required bold action by individual citizens, individual crypto natives, crypto citizens. But he said, "Code is speech, and free speech is a constitutional right and worth protecting." Well done, Alex.

• 1:05:22David Hoffman?

  I hope he gets a po up.

• 1:05:24Ryan Sean Adams?

  You get the retweet, man. Good job, Alex. I'm proud of the community for doing this. David, what do we got for releases?

• 1:05:30David Hoffman?

  Releases. Today, Curve USD was born. New decentralized stablecoin on the scene from Curve, which is an interesting place for a stablecoin to come out of because it is the source of stablecoin liquidity in all of DeFi. So I expect that to be highly competitive. Not much more to report, but that's, that's kind of big. We just are going to have to wait and see as Curve USD gets integrated into the rest of DeFi.

• 1:05:56Ryan Sean Adams?

  Binance.us is launching Ethereum staking with 6% APY ahead of the merge. Yeah, so this is...

• 1:06:03David Hoffman?

  6%?

• 1:06:04Ryan Sean Adams?

  Yeah, Binance.us, alright, so it's the US, you're trying to play catch-up, obviously, with Coinbase and others. And staking with a 6% APY. David, that has to be juiced, because I know you ain't getting 6% from the protocol right now, probably.

• 1:06:20David Hoffman?

  You're getting 4%. Granted, they're only paying, it will be 6-ish% post-merge, so they're only juicing it for like 2 weeks ahead of the merge, so it's not that ridiculous. Why they're juicing it in the first place, I don't know.

• 1:06:32Ryan Sean Adams?

  Oh, promotion. It's just like a promotion. Why would I do Coinbase if Coinbase is 4% and, you know, Binance is 6%? If you're just not really looking carefully at it, you just choose the higher APY.

• 1:06:44David Hoffman?

  Right, but the yield should jump up to at least 5. something% post-merge, so they're not juicing it by that much.

• 1:06:50Ryan Sean Adams?

  This is kind of cool from Notional. Introducing leveraged vaults from Notional. What's going on here?

• 1:06:56David Hoffman?

  Yeah, basically, you can, the way that this works is that a user, say for example, brings 100,000 USDC into Notional, that gives them a line of credit of up to $700,000 USDC from Notional for 4%, and then you can combine those 2 things together to deposit this into this leveraged yield vault. So it's a way to get like 8X on your yield, is like the TLDR of this product. Probably some risk, but also pretty cool.

• 1:07:23Ryan Sean Adams?

  Definitely some risk. Notional, of course, is fixed-rate lending and borrowing, which is really super cool to have a DeFi primitive for that. But as always with leverage, be careful out there, guys. Do not take leverage unless you absolutely know what you're doing. And a lot of you think you know what you're doing, even myself at times.

• 1:07:39David Hoffman?

  You find out that you don't?

• 1:07:40Ryan Sean Adams?

  You find out you don't, the hard way. You get liquidated. David, on the raises side, one thing to cover, what are we looking at here?

• 1:07:47David Hoffman?

  Mistin Labs is the creator of the SUI blockchain, closes $300 million raise led by FTX Ventures.

• 1:07:57Ryan Sean Adams?

  A $300 million raise? That's not a valuation. The valuation is...

• 1:08:02David Hoffman?

  2 billion dollars.

• 1:08:03Ryan Sean Adams?

  What? You know, there's been...

• 1:08:05David Hoffman?

  We should start a layer 1.

• 1:08:10Ryan Sean Adams?

  What would be our price? Five billion?

• 1:08:12David Hoffman?

  Something higher, yeah.

• 1:08:15Ryan Sean Adams?

  Do you know, this is kind of, I've seen like this new crop of fast TPS blockchains, and you see these kind of every, every single cycle, right?

• 1:08:25David Hoffman?

  See it all the time now. This is just like, yeah.

• 1:08:27Ryan Sean Adams?

  Well, the very first one, it was, you know, EOS was, you know, one of the main ones. And then later, I think in future, like it was Solana. Now what's interesting is there seem to be three. This one, SUI, if we're saying it, pronouncing it correctly. And there's another one called SEI, Say, I think is maybe how you say that. So there's SUI, Say, and there's Aptos. And you're getting a lot of the FTXs and the multi-chain capitals and a lot of the VC firms who are funding at these levels. Like, you know, a $2 billion market cap types of, of levels. So it's just interesting to me because you got to, we question, of course, we question all the time.

• 1:09:07Ryan Sean Adams?

  What is the durable competitive advantage? Why is the token worth what it's worth as a layer one? And I guess it's the VCs taking on that risk right now. I just, I always get worried about the, the retail dumpage that, that comes later without any significant progress on many of these projects. And that is what can tend to happen. Although David, I do feel like there probably could be a bankless episode where we explore these projects in some detail. I just, I want to wait until there's some traction or like something to actually talk about.

• 1:09:40David Hoffman?

  I'm sure they would love that if we did that.

• 1:09:42Ryan Sean Adams?

  Well, just the fundraise is kind of boring to me. It's like, what can we do? What have you built? That's the point at which we could get interested. But like, I don't even know the technology stack. I know Aptos is using like.

• 1:09:53David Hoffman?

  There's too many, Ryan, there's too many of these. SUI, Say, Aptos, like, one of these things is going to zero at the very least, if not all three. So somebody's wasting their money.

• 1:10:03Ryan Sean Adams?

  Oh, yeah.

• 1:10:04David Hoffman?

  Or am I just an ETH maxi or something?

• 1:10:05Ryan Sean Adams?

  Maybe David's an ETH maxi. What do you think, bankless community? Which of these projects should we be looking at? You tell us. Jobs, David.

• 1:10:13David Hoffman?

  Jobs.

• 1:10:13Ryan Sean Adams?

  What time is it?

• 1:10:14David Hoffman?

  Job time, time to get a job. Last week to get a job before the merge. Not sure that matters, but it's true either way.

• 1:10:21Ryan Sean Adams?

  You think someone could turn around and get a job in like a week's time?

• 1:10:24David Hoffman?

  They really hustled, yeah.

• 1:10:25Ryan Sean Adams?

  Hit apply?

• 1:10:27David Hoffman?

  If they are a fit in candidate for one of these fantastic jobs that we're about to read out, maybe, perhaps.

• 1:10:32Ryan Sean Adams?

  Well, I'll read them out then. Economia is looking for a lead product and brand designer. What's that, David?

• 1:10:38David Hoffman?

  Uh, non-technical with Ryan.

• 1:10:40Ryan Sean Adams?

  Silent Protocol, full-stack smart contract engineer. Superfoam, senior backend engineer. Bitgreen, uh, full-stack software developer. Messari needs those software engineers for market data and media. DYDX needs a backend software engineer. Stakefish, an HR business partner. Uh, Stakefish also needs a backend software engineer and a front-end engineer, a dev ops engineer. And of course, Bankless is looking for someone to help with media operations. Go apply for these jobs. Go get a job before the merge if you can. The merge is fine, too. Crypto is always hiring on the Bankless job boards. It's bankless.pallet.com/jobs. You can find out more. All right, David, what do we have coming up next?

• 1:11:19David Hoffman?

  Got some questions for the nation. This is when we talk about some of the ETH POW questions, ETH steak questions, overall merge-related questions. Because, Ryan, it's of course the last weekly roll-up before the merge. I don't know if you mentioned that yet, uh, but we gotta answer all the merge questions. Uh, so we'll talk about that. And also the hot and spicy takes from crypto Twitter coming up next. But first, let's talk to some of these fantastic sponsors that make the show possible. Arbitrum is an Ethereum layer two scaling solution that is going to completely change how we use DeFi and NFTs. Some of the coolest new NFT collections have chosen Arbitrum as their home, while DeFi protocols continue to see increased liquidity and usage. You can now bridge straight into Arbitrum for more than 10 different exchanges, including Finance, FTX, Huobi, and Crypto.com. Once on Arbitrum, you'll enjoy fast transactions with cheap fees,

• 1:12:03David Hoffman?

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• 1:12:48David Hoffman?

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• 1:13:26Ryan Sean Adams?

  We are back with the questions from the nation. Of course, if you've got a question for the weekly rollup, you can follow @banklesshq on Twitter. Look for that question of the week, respond, and we may read your question out on the rollup and answer it to the best of our ability. The first one is from johnnycast.eth. Will I receive ETH proof of work for the staked ETH I have? What about if it's staked on a centralized exchange or in an ETH-staking derivative? So this person wants to know, Johnny Cast wants to know, if he is getting a fork of the ETH POW token, should it come?

• 1:14:01David Hoffman?

  He is asking if he's going to receive the ETH proof of work token if he has Ether staked. And if you have Ether staked, that answer is no. No, you are not, because that Ether is in the deposit contract on the Ethereum side, which is where people deposit Ether into the beacon chain. The only reason why you deposit Ether into that contract is to tell the beacon chain to make you some Ether on the proof-of-sake beacon chain. It's a one-way street. It only goes into that contract. There's no way to get it out of that contract. So all staked ether on the Ethereum chain, when it goes into the proof of work chain, will be irredeemable. The proof of work ether will be in that same contract on the proof of work side, but there's no way to get that out. So all staked ether

• 1:14:45David Hoffman?

  is not redeemable for proof of work ether. Doesn't matter where you staked it on a centralized exchange, or with Lido or Rocketpool, that ether is gone. That proof of work ether is gone.

• 1:14:55Ryan Sean Adams?

  But to our point earlier, guys, who cares? It's probably almost nothing. It's probably pennies. It does make sense for a proof of work fork to kind of punish those who staked, right?

• 1:15:06David Hoffman?

  But that's not what it is. That's a byproduct. It's not...

• 1:15:08Ryan Sean Adams?

  It's a byproduct, but like, it's kind of also interesting what's happening. What about on centralized exchange, then? What happens there?

• 1:15:15David Hoffman?

  Same thing. Any stake, any supply of staked ether will be irredeemable. So they can't give you, they won't be giving you anything because they don't have anything to give you.

• 1:15:26Ryan Sean Adams?

  The key word is there is staked. It's the staked piece, right? If it is on a centralized exchange, right, and it's not staked, then it's totally dependent on the exchange, which...

• 1:15:36David Hoffman?

  And the exchange has to facilitate that, yeah.

• 1:15:38Ryan Sean Adams?

  That could be months down the road, or never. So don't expect much.

• 1:15:42David Hoffman?

  If the price moons because people are doing shenanigans, then they'll enable it because that, because people will desire it.

• 1:15:50Ryan Sean Adams?

  Yes. Here's another question from Matt. "In the first few hours after the merge, is ETH proof of work value will receive equal the value of our ETH proof of stake? So can we double our ETH holdings if we exchange the proof of work for the proof of stake as soon as possible?" This is another question. I think there's been a lot of question about this new proof of work hypothetical chain. What's the answer to Matt's question here?

• 1:16:14David Hoffman?

  Well, so we saw the chart earlier that was doing a futures market for $30 for a proof of work ether. You will have the same number of units, but the market prices on these things will be totally different. And so like, after Armageddon on the proof of work chain happens, because all ether positions in MakerDow of a compound will be liquidated, all total... tokens on Uniswap like MKR Ave will be worth zero and so like those people who have those will liquidate those. There's going to be like just like Y2K on the Ethereum beacon chain on the block one, two and three. After the dust settles, then the proof of work ether will have some sort of value determined by the market that will be

• 1:16:56David Hoffman?

  significantly meaningfully lower than the actual ether, real ether, proof of stake ether. And then if you are sophisticated and you can set up the infrastructure, you can sell the proof of work ether. And you, yeah, on Poloniex because they say they're going to support it.

• 1:17:09Ryan Sean Adams?

  Maybe if you could find an exchange that supports it.

• 1:17:12David Hoffman?

  It's not going to be a Uniswap, yo. Like it's only going to be centralized exchanges that facilitate this marketplace.

• 1:17:16Ryan Sean Adams?

  Unless someone decides to kind of pick that up and run like, yeah, it's going to be really hard to escape from. And what we're talking about here, even in the futures market, it's like $31 per ETH, basically. It's kind of what you'd get.

• 1:17:29David Hoffman?

  I do not think anyone will be seeing a dime. I think very, excuse me, very few people will see a dime.

• 1:17:34Ryan Sean Adams?

  Few retail, like normal people.

• 1:17:36David Hoffman?

  Highly motivated retail people who are running both a consensus node on the beacon chain and well, no, actually just a pre- a pre-

• 1:17:46Ryan Sean Adams?

  Look, dude, the people asking these questions are probably getting nothing.

• 1:17:49David Hoffman?

  Yeah, if you don't know how to do it, you're not getting it. Like, sorry. The best thing, okay, if you are retail and you are super bullish on trying to get that ETH proof of work token. The thing that I would do, even though I'm not recommending you to do this in the first place, is to deposit your ether into Poloniex. Because Poloniex, the exchange, even though it's run by a very shady individual, Justin Sun, said that they are going to support the ether proof of work chain. And so they will do all the service for you. So if you are somehow, after listening to this, magically still bullish on the ETH proof of work chain and you don't know how to go do it yourself, deposit your ether into Poloniex. They said that they will credit people their proof of work ether and then you can, you can just use them to do it. I don't recommend you doing that, but that's how you would do it.

• 1:18:32Ryan Sean Adams?

  But also don't do it.

• 1:18:32David Hoffman?

  And also just don't fucking do it. Sorry for swearing.

• 1:18:36Ryan Sean Adams?

  Here's a question from Henry JK4. This may be basic, but with the ETH I have when the merge happens, will I get new ETH or will my existing ETH convert to the proof of stake chain? Can you explain this for me? Thanks so much for all you guys have been doing, been listening for about a year now. So what does the average person ignore the ETH proof of work, proof of stake, ignore all of that? You're just holding ETH right now.

• 1:18:58David Hoffman?

  What do you have to do?

• 1:18:59Ryan Sean Adams?

  Yeah. What do you have to do on the other side? Is there anything that you have to do? What happens to your existing ETH that you're holding?

• 1:19:05David Hoffman?

  Nothing. Nothing changes. Remember, remember we saw that pie chart that said 95% of validators are ready? That's because like 95% of people, and it's going to approach 99%, are ready to do the hot swap. Your ether doesn't convert. It doesn't change form. It doesn't do anything. You actually won't even notice anything at all happening whatsoever. Maybe there'll be a blip in EtherScan or something ideally, just a blip, but just like your ether that you have today is proof of stake ether. Once we hit post-merge.

• 1:19:36Ryan Sean Adams?

  So if you're an ETH holder, what do you have to do? Nothing.

• 1:19:39David Hoffman?

  Nothing.

• 1:19:40Ryan Sean Adams?

  If you're a DeFi user, what do you have to do?

• 1:19:42David Hoffman?

  Nothing.

• 1:19:43Ryan Sean Adams?

  Nothing.

• 1:19:43David Hoffman?

  Nothing. Maybe monitor your positions if you're on leverage or something like that.

• 1:19:47Ryan Sean Adams?

  Sure. If you're levered up or doing something like that.

• 1:19:50David Hoffman?

  Yeah, pay attention.

• 1:19:51Ryan Sean Adams?

  Pay some attention. If you are a, uh, running a node, Ethereum node, you gotta update. Well, you will have already have updated your node.

• 1:20:00David Hoffman?

  If you haven't updated your nodes, you gotta update your nodes.

• 1:20:02Ryan Sean Adams?

  You're late.

• 1:20:02David Hoffman?

  Yeah, you're late, but not too late.

• 1:20:04Ryan Sean Adams?

  But if you're not running a node, if you're just an ETH holder or a general DeFi user is not on leverage, nothing you have to do. It just transfers gracefully.

• 1:20:13David Hoffman?

  You can tune into all of the live streams. That's what you can do. There'll be many, many live streams a day of the merge.

• 1:20:17Ryan Sean Adams?

  Next week. We're doing a lot of those. We went over the schedule earlier, didn't we?

• 1:20:21David Hoffman?

  Yes, yes, we did. Yeah.

• 1:20:23Ryan Sean Adams?

  All right. Takes the week, David.

• 1:20:25David Hoffman?

  Takes the week.

• 1:20:25Ryan Sean Adams?

  This is from Tim Bako, who is an ETH, I guess, core developer, core coordinator?

• 1:20:30David Hoffman?

  Core developer coordinator. Yeah. Works for the Ethereum foundations.

• 1:20:34Ryan Sean Adams?

  Key person that made the merge happen.

• 1:20:35David Hoffman?

  Yeah. Him and Danny Ryan are like the two people that made the merge happen. And Tim Bako, that's, that's putting too much weight on their shoulders. Many people made the merge happen. Tim was a coordinator of many of these people. And Tim Bako says, "I've said we might have merged by then twice on the core dev meetings today, and it feels pretty surreal to be honest. It's happening." Sparkly emoji. Really cool take, really cool take. We're already talking about just like after the merge, the state of things after the merge.

• 1:21:03Ryan Sean Adams?

  It's happening. So much work to get us here and it's actually happening. You know, the Ethereum community has been waiting for so long for this week to happen and it's actually happening in spite of so many doubters who said the merge would never happen. Ethereum, there's no way it'll transition to proof of stake. It's like replacing an airline engine in midair. Too complicated, too difficult.

• 1:21:27David Hoffman?

  Protocol devs were like, "Challenge accepted."

• 1:21:30Ryan Sean Adams?

  It's awesome. I've got a-

• 1:21:31David Hoffman?

  Again, knock on wood against the whole like Hillary Clinton thing.

• 1:21:35Ryan Sean Adams?

  This is a tweet from me this week. You're old, but are you old enough to remember this? And this is, I'm showing an image for, if you can't see it on the podcast side, you can catch it on YouTube. This is an image of the original Maker DAO interface. David, do you remember when Maker looked like this?

• 1:21:52David Hoffman?

  I do remember. And I remember experiencing this interface, being frustrated, but also optimistic. And then finally figuring out how to mint DAI for the first time and seeing the DAI show up in my wallet. And I just, I didn't obviously have any like concrete predictions, but you could just feel the future. It's like, no, I did not know Uniswap would be a thing, but I kind of figured there would be something like it. And like, yes, this is automated, algorithmic, financed by code. And this was like my magic, like aha moments. Like I just minted money and no one stopped me.

• 1:22:24Ryan Sean Adams?

  I just minted money. I just took out a loan. No bank, no bank account, no paperwork, just code and ETH transactions. It was incredible.

• 1:22:34David Hoffman?

  This, this, the, gosh, could you imagine this if all DeFi interfaces were like this level of just like clunkiness now?

• 1:22:42Ryan Sean Adams?

  I just, what I'm, what we're looking at is an interface that looks like it was from, I guess, 2017 or so, 2017, 2018. But it looks like it's from the early 2000s. I mean, it is just terrible.

• 1:22:56David Hoffman?

  Did the job it needed to do at the time.

• 1:22:57Ryan Sean Adams?

  So this is like the old Grandpa David and Grandpa Ryan saying to you youngsters, "You got it good, kids."

• 1:23:04David Hoffman?

  Your guys' interfaces are great.

• 1:23:06Ryan Sean Adams?

  They're so good compared to the old days.

• 1:23:09David Hoffman?

  They don't even know what PEETH is. They don't even know what PEETH is.

• 1:23:12Ryan Sean Adams?

  Do you say PEETH?

• 1:23:13David Hoffman?

  PEETH.

• 1:23:13Ryan Sean Adams?

  I said PATH. I always said PATH.

• 1:23:15David Hoffman?

  P A?

• 1:23:16Ryan Sean Adams?

  Who knows? We didn't even have, we didn't even have a consensus on whether it's PATH or-

• 1:23:21David Hoffman?

  Oh gosh, you remember when people would say F?

• 1:23:24Ryan Sean Adams?

  Yeah.

• 1:23:25David Hoffman?

  Instead of ETH?

• 1:23:25Ryan Sean Adams?

  I hated that.

• 1:23:26David Hoffman?

  I hated that.

• 1:23:28Ryan Sean Adams?

  Your interfaces have gotten much better and the rate at which they are improving makes me so bullish on this space. You know, if I contrast that to my interface for my bank, Wells Fargo.

• 1:23:37David Hoffman?

  Right.

• 1:23:37Ryan Sean Adams?

  It's like been no change in the last five years.

• 1:23:39David Hoffman?

  It's so bad.

• 1:23:40Ryan Sean Adams?

  But it's basically the same as it was five years ago. It's like equally kind of terrible.

• 1:23:43David Hoffman?

  Right.

• 1:23:45Ryan Sean Adams?

  What's this take from Plenya?

• 1:23:46David Hoffman?

  Plenya says, "A swap on Binance Smart Chain is five times more expensive than Arbitrum, yet Binance Smart Chain has 10 times the activity. BSC has established clear network effects, particularly in eastern markets, and rollup teams have to do their marketing, have to up their marketing game significantly to outcompete BSC, their stiffest competition." Interesting take.

• 1:24:05Ryan Sean Adams?

  What do you think about this? The idea Plenya goes on to say, "Today I learned Binance Smart Chain are building ZK rollups." Can you imagine running a ZK rollup layer two on top of Binance Smart Chain? And this is Plenya, who knows what they're talking about, really not necessarily bullish on Binance, like the token behind Binance Smart Chain, but certainly like it's establishing it as the one to beat for other layer twos. What do you think of this take?

• 1:24:34David Hoffman?

  Yeah, I heard Anthony Susano on the Daily Gray talk about this, and I think a lot of this comes down to language, as in there might just be more like Chinese or English language support of the Binance Chain ecosystem. And so it's kind of accidentally become like the Ethereum of the East, just based off the language barrier. I think that actually does account for a very decent amount, and just like the raw power of Binance has that is also big in the East too.

• 1:25:03David Hoffman?

  But I think that's, I think that chalks up to more than, more than 50% of the reasoning why Binance Chain is so big.

• 1:25:08Ryan Sean Adams?

  I think this is a good message for layer twos. If you want to onboard the world, you have to have multi-regional, multi-language support, right? It's a key component of this. Anyway, I, I'd like to do a bit more on, you know, Binance Smart Chain. I'm not super interested in the technology, but like the adoption it's had and where it's coming from is somewhat interesting to me.

• 1:25:26David Hoffman?

  Right. Here's another tweet from Ryan Chon Adams, who's been super focused on just like reserve currencies and more and all this stuff. And so we're gonna hear his takes here in a hot sec. Ryan says, "Reserve currency statuses rise and fall over the decades. I expect Ethereum to be one of the next ones to rise." Ryan, what are we looking at?

• 1:25:43Ryan Sean Adams?

  We are looking at a pie chart over time. And the way this begins is at the beginning of the 1900s. We take you back to 1901, when the British pound was 60% of the reserve, the world's reserve currency. And do you know what's second, David? The French franc.

• 1:26:02David Hoffman?

  I don't remember that one.

• 1:26:04Ryan Sean Adams?

  And then behind that, pound sterling, no, excuse me, behind that, Deutschmark. And there's also a category for others. So, you know, British pound, by far, the world's monetary, the world's of reserve currency. And then this kind of fast forwards through time. And you can see the British pound as a percentage of the world, it kind of ebbs and flows through World War I, through World War II. And we fast forward all the way to even after World War II, in the 1950s, the British pound still had like 45%.

• 1:26:36David Hoffman?

  Oh, today I learned.

• 1:26:37Ryan Sean Adams?

  Right. But then the US dollar, which wasn't even present in 1901, wasn't even on the map for a world reserve currency, is now 46% of the world's currency. And then we fast forward to, of course, where we are today. Can you see the British pound anymore on this chart?

• 1:26:55David Hoffman?

  Well, no, it got folded into the euro.

• 1:26:58Ryan Sean Adams?

  It got folded, well, it's still present.

• 1:26:59David Hoffman?

  Oh, wait, no, yeah.

• 1:27:00Ryan Sean Adams?

  Yeah, it's still present.

• 1:27:01David Hoffman?

  It's 4.5%. It's tiny.

• 1:27:03Ryan Sean Adams?

  It's tiny. It's 4.5%. You got the euro, that's 20%, and the US dollar, that is 61%. I think the take here is just when you see this chart over time, the fleeting nature of

• 1:27:13David Hoffman?

  Reserve currencies.

• 1:27:14Ryan Sean Adams?

  Reserve currencies is, you know, something to hold on to. And this looks a lot like 1901, right? When the British pound was the dominant reserve currency. Now we're in, you know, 2022, and the US dollar is about 60%. All right, David, what are you bullish on this week?

• 1:27:31David Hoffman?

  Ryan, I am bullish on the ETH/BTC ratio, as I have been. And Djen Spartan put out a pretty cool tweet that talked about how much of ETH BTC people that are taking on this trade, such as myself, will be permanently unwound post-merge. He says, "I expect a drop from the people that think it's an airdrop play, LMFAO, but I expect it to be one of the greatest paradigm shifts in hindsight as ETH goes from a zero to one as a hoarding asset, and flows will be one directional." And then I follow up and I say, "The point of the ETH BTC trade is to hold it." And like, it's not just like a momentary thing, because that's how press said on our show with him, "Once we go through the merge, time works with Ether and against Bitcoin."

• 1:28:16David Hoffman?

  Because with proof of work, theoretically it approaches 100% of all sell pressure from proof of work miners. And with proof of stake, it's the inverse. It's the theoretical 100% gets held by proof of stake stakers. So every single dime of proof of work miners gets sold, every single penny of Ether stakers gets held. Again, in principle, these things are probably more around like 90%, but that just goes to the contrast is time works with Ether and it works against Bitcoin. And so if you are somebody like myself who's short Bitcoin and long Ether, the point of that trade is that it just works. So like, people are like, super focused on like the flipping rounds, like Ether is 53% the market cap of Bitcoin.

• 1:29:00David Hoffman?

  At some point, it'll flip Bitcoin. I have 100% confidence in this eventually. But like, the trade is not over there either. Like, once you flip Bitcoin, you can flip it again. Like, you can lap Bitcoin over and over and over again.

• 1:29:13Ryan Sean Adams?

  This is David shilling his ETH Bitcoin ratio bags to you guys.

• 1:29:15David Hoffman?

  Yes, yes, I am. I'm chilling my trade. It's like, I'll unwind my Ether Bitcoin trade when Ether, Ethereum is worth like 3 Bitcoins.

• 1:29:23Ryan Sean Adams?

  That's a hold forever. Wow. Is there, is there any like, are you mad at Bitcoin at all? Is there any like vindictiveness in that trade?

• 1:29:30David Hoffman?

  No, it's just that, it's just, it's just the flows. It's just the factual flows. If proof of work is forced selling and proof of stake is incentivized hoarding. This is why, this is why Djen is saying Ether goes from zero to one as a hoarding asset and flows will be run directional. It's just a fundamental part of the fundamentals. I'm not trading narratives, I'm trading the fundamentals.

• 1:29:53Ryan Sean Adams?

  I've been, I've been hoarding this thing for a while. I, I didn't just start hoarding, zero to one, been hoarding.

• 1:29:59David Hoffman?

  Right, right.

• 1:29:59Ryan Sean Adams?

  It's funny.

• 1:30:00David Hoffman?

  You want to hoard ahead of the transition from zero to one.

• 1:30:04Ryan Sean Adams?

  Ideally. Um, there's still time, of course.

• 1:30:06David Hoffman?

  That's what I, but oh, you know what I'm also bullish on, Ryan? You know what I'm about to go do after this?

• 1:30:10Ryan Sean Adams?

  No.

• 1:30:10David Hoffman?

  Do you guys, you know, you know this guy, Zach Weinberg?

• 1:30:13Ryan Sean Adams?

  Yes, I saw a clip with him with, um, Andreessen, Marc Andreessen, where, uh, he's kind of, um, playing an Andreessen clip and just like digging into how stupid it is. Uh, Andreessen's answer, I think on like what Web 3 means. So he, this person is, uh, Zach is a Web 3 crypto critic, I believe.

• 1:30:33David Hoffman?

  Yeah, uh, right after this, I'm about to go into Manhattan and debate him on stage at some like VC founders conference.

• 1:30:40Ryan Sean Adams?

  That'll be fun.

• 1:30:41David Hoffman?

  I'm gonna smear his face. I don't, I don't think it is. I don't think it is. Uh, but if it is, I will definitely tweet it out. But yeah, me and, I was listening to him. I didn't hit, listen to his, uh, Andreessen clip, so I gotta go listen to that. But I did listen to him going up against Paki McCormick.

• 1:30:54Ryan Sean Adams?

  Yes.

• 1:30:55David Hoffman?

  And like, I'm like, dude, Paki, you are missing some really low hanging fruit, like, points here. And so I don't think that Zach Weinberg has gone up against any sort of meaningful competition yet, until two hours from now, when I smear his face.

• 1:31:09Ryan Sean Adams?

  Wow.

• 1:31:09David Hoffman?

  I'm kidding, I'm kidding, I'm kidding.

• 1:31:10Ryan Sean Adams?

  He's super aggressive, David. Just pre-merge David is like, just, you know, he's jacked.

• 1:31:15David Hoffman?

  I had an extra cup of coffee today.

• 1:31:16Ryan Sean Adams?

  He's got the adrenaline. Watch out, Zach. I think it'll be good. I actually, I think if that episode, if that goes well, sorry, I called it an episode, if that debate goes well, we should host him on Bankless.

• 1:31:26David Hoffman?

  Sure.

• 1:31:26Ryan Sean Adams?

  And, uh, have kind of a, a review of like another one of that, cause we need some more critics. If he's a good critic.

• 1:31:31David Hoffman?

  Round two. Ding ding ding. Alright, Ryan, what are you bullish on? Who are you debating this week?

• 1:31:35Ryan Sean Adams?

  Uh, I'm not debating anyone if I can help it, alright? I just want good vibes into the merge. I, I don't want, you know, no hassle, but you know what I am bullish on, or what? Maybe this is kind of a thank you. This is a gratitude. The ETH developers, all right, we saw earlier about 120 core developers. A lot of ETH developers made the merge happen. And we know some of them. We don't know all of them. All right.

• 1:31:58David Hoffman?

  We don't know most of them.

• 1:31:59Ryan Sean Adams?

  We don't know most of them. And particularly the kind of the silent people have been just coding in the background, making this happen. Like sincerely, thank you. I think the entire Ethereum community has you to thank. We can't build this. Dave and I are here working on the social layer. We're users. We're building it a different way. But like, none of this would be possible without the Ethereum developers, the core developers. And I remember a time when everyone said, no one thought they could do it. Do you remember back in 2018? A lot of the talk was, there's not enough protocol, there's not enough funding for the devs to actually do this.

• 1:32:36David Hoffman?

  You don't have any money.

• 1:32:37Ryan Sean Adams?

  There was semi-serious propositions to actually add a protocol dev tax inside the protocol to siphon off a portion of this and give it to devs to fund it. We did this without protocol funding. We did this with frustrating roadmap pivots. Do you remember in 2020, it was 2018? We were supposed to get proof of stake. We were like months away from forking it in, an earlier version of it. And the roadmap completely changed. A better version was in sight, so we just pivoted towards the better version, right? What kind of patience does that require to keep along with the project? And it's like delayed for like five years. They've been working on this stuff.

• 1:33:21Ryan Sean Adams?

  And they did it all without a centralized corporation, all in this like decentralized, open source way. And I don't think there's any precedent for what we are seeing. Like launching a staking protocol like this, which is maximally decentralized at scale, and converting it in real time with a network that's worth hundreds of billions of dollars in real time. And that's what's happening next week. I think it's a historic event. And I am bullish and thankful for the Ethereum developers. And man. This protocol can ship. I didn't always know that was true. I didn't always believe that, but we're doing it now. So that's what I'm bullish on.

• 1:34:03David Hoffman?

  Yeah, every single client team has eight, 10, 20 people on its team that have been working on this. And there's like six, seven client teams. That's not even to account for like all the people at the EF also helping coordinate this thing. So like the image that came to mind while you were talking is just like that, the picture of like Atlas and they have all the core teams like holding up Ethereum. Like everyone who's ever used Ethereum and is bullish on the merge has a core developer to thank. Have you thanked a core developer this week? Because if you haven't, please do. We should make that into a meme next week. Have you thanked a core dev yet?

• 1:34:36Ryan Sean Adams?

  Thank you. You know,

• 1:34:37David Hoffman?

  Thank you.

• 1:34:37Ryan Sean Adams?

  Thank you.

• 1:34:37David Hoffman?

  Ryan has. Ryan did just now. That's what he was doing. He was first.

• 1:34:42Ryan Sean Adams?

  I feel like there's other things I could be doing, but yeah, we appreciate the Ethereum development community for sure. David, meme of the week, what are we looking at this week?

• 1:34:50David Hoffman?

  We were looking at the Patrick SpongeBob meme that is like, what if we take this and put it over there? Ethereum miners, this is the headline from earlier in the roll up. Ethereum miners made $756 million in revenue in August ahead of the merge. And Patrick, the meme goes, what if we take the miner revenue and give it to the stakers? Basically what the Ethereum proof of stake mechanism is, although you do have to take note that you are doing a supply reduction of 90%, so actually only 10% of the stakers get that. But also, stakers are holders of ETH. And so since the miners aren't dumping the ETH, they get, they do get the benefit of not having Ether dumped on them by miners. So I will say that they get the full value of that.

• 1:35:29Ryan Sean Adams?

  That's true. It's what's happening. The stakers are the new security budget for Ethereum, essentially.

• 1:35:35David Hoffman?

  And ETH holders, yeah.

• 1:35:36Ryan Sean Adams?

  Yeah. So, right? I mean, this notion of Ether as a tokenized ASIC, basically, I think is holding true. So that's what's happening next week. Of course, David and I will be with you all week. Make sure you tune into Bankless Podcasts and on YouTube, and of course, on Twitter. We'll leave it there. None of this has been financial advice. ETH is risky. DeFi is risky. So is all of crypto. You can definitely lose what you put in. But we are headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the Bankless journey. Thanks a lot.

• 1:36:07David 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, podcast 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,

• 1:36:48David Hoffman?

  Ask Me Anything's and weekly rollups where we summarize the week in crypto and other fantastic content. Thanks everyone for watching and being on the journey as we build out the Bankless Nation.