ROLLUP: Ethereum Merge Breakdown | Starbucks Polygon | Solana NFTs | Do Kwon Arrest | Binance zkRollups

3rd Week of September, 2022 ------ 📣 Swell | Liquid Staking for the People https://bankless.cc/swelldiscord ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/ 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ ------ BANKLESS SPONSOR TOOLS: 🌱 LENS | WEB3 SOCIAL PROTOCOL https://bankless.cc/Lens 🚀 ROCKET POOL | ETH STAKING https://bankless.cc/RocketPool ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum 🦁 BRAVE | THE BROWSER NATIVE WALLET https://bankless.cc/Brave 🌉 JUNO | BRIDGE FIAT TO LAYER 2 https://bankless.cc/Juno ⚡️ ZKSYNC | THE LAYER 2 SCALING ENDGAME https://bankless.cc/zkSync ----- Topics Covered 0:00 Intro 4:10 Crypto Markets 9:35 Macro Markets https://www.cnbc.com/2022/09/12/stock-futures-are-higher-as-wall-street-awaits-key-inflation-report-.html 12:00 Monthly CPI https://twitter.com/tomhschmidt/status/1569676483076964358 14:00 Elon Musk Deflation Take https://twitter.com/elonmusk/status/1568383953370767365 17:00 MERGED https://twitter.com/VitalikButerin/status/1570306185391378434 20:25 Energy Efficient https://twitter.com/VitalikButerin/status/1570299062800510976 21:00 Recapping the Merge Google https://www.google.com/search?q=the+merge Bordel https://twitter.com/TMIYChao/status/1570319141994889216 Denver Watch Party https://twitter.com/trent_vanepps/status/1570304900634144769/photo/2 Raoul Jordan https://twitter.com/rauljordaneth/status/1570313476358213632 25:00 Ethereum Hashrate https://twitter.com/cryptoquant_com/status/1570304759525150722 26:25 MEV Boost https://twitter.com/hasufl/status/1570326887729336320 28:05 Ultra Sound Money https://twitter.com/ultrasoundmoney/status/1568977730330320896 32:30 ETH Supply https://twitter.com/hasufl/status/1570307515350683649 Blocktime https://twitter.com/koeppelmann/status/1570306606339964929 33:55 David Explains the Merge https://twitter.com/BanklessHQ/status/1570294915074248709 35:55 Mainstream Coverage https://www.nytimes.com/2022/09/15/technology/merge-ethereum-crypto.html 37:10 Staking APR https://twitter.com/RyanSAdams/status/1569350617910362112 38:25 Where to Stake https://simplestakers.info/ 43:00 NEWS 44:00 Vitalik in Ukraine https://twitter.com/revrfg/status/1568885771129470977 45:$5 Starbucks x Polygon https://twitter.com/0xPolygon/status/1569302728005804037 48:25 Solana NFT All-Time High https://www.theblock.co/post/169050/nft-mints-on-solana-have-surged-to-an-all-time-high 49:20 White House Proof of Work https://twitter.com/TIME/status/1569529551897743361 54:32 Michael Saylor Buys https://www.coindesk.com/business/2022/09/09/microstrategy-files-for-stock-offering-of-up-to-500m-in-part-to-buy-additional-bitcoin/ 55:30 China Bitcoin Usage https://twitter.com/zerohedge/status/1570185657301057543 56:00 Tornado Cash Withdrawals https://twitter.com/ryansadams/status/1569728093853552642 1:02:00 Do Kwon Arrest Warrant https://www.bloomberg.com/news/articles/2022-09-14/south-korea-seeks-the-arrest-of-terraform-labs-founder-do-kwon 1:03:14 SEC Crypto Office https://www.reuters.com/markets/us/us-sec-set-up-new-office-crypto-filings-2022-09-09/ 1:05:30 Coinbase Policy Efforts https://twitter.com/brian_armstrong/status/1570133078022160384 1:09:30 Token Unlocks https://token.unlocks.app/ 1:11:08 Abra Bank Boost https://twitter.com/billbarhydt/status/1569356209651687424 1:12:50 Binance zk Rollups https://www.bsc.news/post/bnb-chain-announces-the-testnet-launch-of-zkbnb 1:13:50 Plasma Wallet https://plasma-wallet.com/ 1:15:00 Raises Doodles - https://twitter.com/doodles/status/1569655759297716228 Coop Records - https://twitter.com/Cooopahtroopa/status/1567917204221591552 1:17:20 JOBS 1:19:00 TAKES 1:20:00 Enabling Withdrawals https://twitter.com/0xfoobar/status/1569466790266433536 1:22:02 Ethereum Never Ships https://twitter.com/TrustlessState/status/1570426020045406213 1:23:30 All Grown Up https://twitter.com/RyanSAdams/status/1570325531899629571 1:25:45 Vitalik Speaks https://twitter.com/VitalikButerin/status/1569369929454845957 1:27:10 What We’re Bullish On 1:34:10 MEME of the Week https://twitter.com/BanklessHQ/status/1570148692119916546 ------- Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

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

• 0:09Ryan Sean Adams?

  Bankless Nation, it is the Merge Friday of September. David, what time is it?

• 0:15David Hoffman?

  The Merge o'clock? I don't know. Ryan, it's time for the Friday Bankless Weekly Roll-Up, where we cover the entire weekly news in crypto, which is always an ambitious endeavor. Because it's Merge Week this week, we are merged, no longer future tense, now past tense. And so grab your coffee, because that is what we are going to be covering. The merge and so many more things that happened in the last seven days. But mostly, mostly the merge, though.

• 0:38Ryan Sean Adams?

  Mostly the merge. Yeah, we got it. We're going to talk about that a lot. Last week was the last weekly roll-up on proof of work. This week is the first weekly roll-up, roll-up completely on proof of stake.

• 0:50David Hoffman?

  As it goes.

• 0:51Ryan Sean Adams?

  This podcast did not consume any energy in the production of this podcast.

• 0:55David Hoffman?

  Not sure. It's totally true. But Ethereum is now, Ethereum node is now consuming less energy than this podcast takes to create. Yes.

• 1:04Ryan Sean Adams?

  Wow. That's a fun fact.

• 1:05David Hoffman?

  That is a fun fact.

• 1:06Ryan Sean Adams?

  How are you feeling, man? Because so I got some naps in between. Like, I woke up for the merge, middle of the night for me. By the way, it happened at the worst possible time for East Coasters.

• 1:17David Hoffman?

  I was upset. I put out a tweet, I put out a tweet yesterday, I said, "Hey, can we delay the merge for a more, like, reasonable hour?"

• 1:24Ryan Sean Adams?

  Well, and you don't get to decide unless you're a miner, basically, right? That's the only power to decide. But, I mean, it was looking pretty good the last few weeks. It was, you know, 8:00 a.m. in the morning, something like this, East Coast time. That would have been perfect, as it happened.

• 1:37David Hoffman?

  It got up to 11:00 p.m. East Coast time, which was, was gonna be great.

• 1:42Ryan Sean Adams?

  When was the exact time? I can't remember. I woke up at like 1:20 or 1:30 or something in the morning, East, my time, and it happened between that and like 2:30, I believe.

• 1:50David Hoffman?

  I think it was like 2:30 to 2:45 in the morning. Yeah.

• 1:54Ryan Sean Adams?

  2:30 to 2:45 in the morning. But, I mean, there was a lot of energy on that call, even for, like, folks in the US who are East Coast time. And of course, the call was attended by everyone from around the world. What a surreal experience this was to witness. And how many people were on the, the call itself, David?

• 2:12David Hoffman?

  Attending the call, like, in the actual Zoom, it was something like 40 or 50 people. We had a peak people watching of almost 50,000, but by the time I woke up in the morning, it was over a quarter million.

• 2:23Ryan Sean Adams?

  That's absolutely incredible. The biggest event in crypto. We'll talk about that. A few other things we're going to cover. Inflation, that was the news in macro markets, but is it really that bad? The S and P stocks seem to think it is. We talk about what we think. Also, a crypto founder has been issued an arrest warrant. That happened this week as well. We're going to tell you which one in the roll up. Can you guess? There are a few. There are a few you could be thinking about right there. But as always, make sure if you enjoy the weekly rollups that you like this, wherever you are listening, subscribe, of course, on the podcast or YouTube. And if you're listening to the podcast, write us a review. Rate the episode. That's how we get up to the top of the charts. David, before

• 3:08Ryan Sean Adams?

  we get to the markets, there's an announcement from our friends and sponsors at Swell Network. This is a new ETH staking opportunity. Comes at a good time. Of course, you and I, David, we like the Swell team so much. We also became angel investors. But what is the Swell Network? What are they doing?

• 3:25David Hoffman?

  Swell Network is joining the ranks of Rocketpool and Lido as a decentralized permissionless staking as a service system. And Swell is really going after the best of both worlds from both Rocketpool and Lido. It's got the permissioned validator set like Lido that helps it scale, but it's also got the permissionless validator pool, so anyone can join the network and validate. And so this is a brand new staking as a service network coming out of the ground just in time for the post-merge world. So there's a link in the show notes, so you can go and join the Swell Network Discord and get in on the ground floor of a brand new staking as a service system. Really excited. And like Ryan said, and also

• 4:07David Hoffman?

  full disclaimer, both Ryan and I are angel investors into Swell, and they are also a sponsor of this message.

• 4:12Ryan Sean Adams?

  All right, David, let's get into the markets this week, starting with Daddy Bitcoin. Up or down on the week, David?

• 4:18David Hoffman?

  Yeah, Bitcoin actually made it up on the week. So it is up 2.5% from $19,300 to $19,850. So a modest 2.5% bump on the week.

• 4:31Ryan Sean Adams?

  That's actually really impressive, given the week that was, I mean, down in stocks and I think down in ETH price as of now, as of recording. Things were pretty flat post-merge. There was no, there's really no volatility, neither up nor down after a successful merge.

• 4:46David Hoffman?

  Until we said it.

• 4:47Ryan Sean Adams?

  Until we said that. So we did a post-merge recap, and I think the ETH bulls were all commenting on the lack of volatility in this market. And then, what's this? Big red candle. What price are we at this week, right now?

• 4:59David Hoffman?

  Yeah, we started the week at 1650. We are down 8.7%. And you see these two big red candles. That one in the middle of the week is the macro red candle where the inflation numbers came out. And so we tanked from like 1750 down to about 1500. Then we reclined right into the merge up to 1650, but then, right as we started recording this, we go all the way down to 1500. So we are overall ETH is down 8.5% on the week. Oof.

• 5:30Ryan Sean Adams?

  I really, by the time this episode is released, I really have no idea.

• 5:34David Hoffman?

  No idea.

• 5:34Ryan Sean Adams?

  Like, this could recover, the candle could reverse, we could be down further, who knows? I mean, sometimes, I just wonder if we tend to overanalyze things. This could just be market noise, traders playing trader games, like-

• 5:46David Hoffman?

  People unwinding an ETH power trade, who the hell knows?

• 5:48Ryan Sean Adams?

  Yeah, exactly. We'll look at this, you know, on the month-type basis, and that'll be a clear indication. Although, I will say, ETH BTC ratio, it was doing well last week in favor of ETH. Now it is back down. So Bitcoin, a very strong recovery on the ratio. What's that looking like this week?

• 6:08David Hoffman?

  We really ended last week at like the top tick of the recent ETH BTC ratio move. So we ended last week at 0.085. We are currently down to 0.075, currently at 7.6, excuse me. And so, but we're bouncing between 0.075, 0.085. So, down 10% on the week, so bad week, but we will see as this thing goes into the future.

• 6:31Ryan Sean Adams?

  Yeah, what's interesting about the ratio, it's probably for you, I would consider you now, David, you've come out as a ratio bull, a big ratio bull.

• 6:39David Hoffman?

  I'm mainly long the ratio, yes.

• 6:41Ryan Sean Adams?

  Okay. And when you say long, you're talking about multi-year time horizon. I've heard you talk about like five years. So like, my time horizon for ETH is like, five to 10 years at minimum, at least, right? Actually, for me, similar to Bitcoin, I think you have a similarly long time horizon for the ETH Bitcoin ratio. At what point- Like, do you think the thesis will have, you know, completed?

• 7:04David Hoffman?

  Played out? Yeah, like, minimum, something like 18 months. And I'm really going for my price target is what I'm calling the lappening or the lapping. So like, you know, we have the flipping where Ether flips Bitcoin. But I'm planning on unwinding this ETH BTC position at like the lappening where their Ether is like two times the Bitcoin price or two times the Bitcoin market cap. No clue when that take, when that's gonna happen. But it's gonna be a multi-year-long endeavor, of course. But the whole argument is that this minor sell pressure is fundamentally bearish. And proof-of-stake hodl pressure is fundamentally bullish. So time, like Hal said on our show, time is on Ether's side. Time is a tailwind for Ether and a headwind for Bitcoin.

• 7:49David Hoffman?

  And so like, while these short-term moves like always just make no sense, over the long term, the sell pressure into proof of work is a headwind that Bitcoin has to fight against that Ether doesn't have to fight against.

• 8:01Ryan Sean Adams?

  What's really interesting about that is, do you remember the episode we did with Arthur Hayes? Right? And like, the concept we kind of coined, I don't know if this is a concept anyone else uses, but like, Arthur to us was a thesis-driven trader. This, to me, David, feels like you're being a thesis-driven trader here.

• 8:16David Hoffman?

  Yes.

• 8:16Ryan Sean Adams?

  In that like, this is a trade, definitely.

• 8:18David Hoffman?

  This is a trade, yeah. Yeah, so it's something I have to sell. I have to press the sell button eventually if I want to get my ETH back, yeah.

• 8:24Ryan Sean Adams?

  Exactly. So it's, David's playing a trade here, but it's not a kind of a narrative trade. It's not a short-term, like, trade or some other sort of trade. It's like a trade that you think is backed by some fundamentals. And that fundamental is all about flows into and out of the asset class. Well, let's talk about flows into the global cryptocurrency market cap, David.

• 8:47David Hoffman?

  I think you mean out of, Ryan.

• 8:49Ryan Sean Adams?

  Uh-oh, are we down on the week?

• 8:50David Hoffman?

  Yeah, we're down on the week. Start of the week at 1.28 trillion. We are down to 1.009 trillion. So, lost a few billy on the week.

• 9:00Ryan Sean Adams?

  A few billion on the week, but that was up last week, maybe artificially so with Bitcoin kind of lagging as non Bitcoin coins emerged. David, the last week, we have been talking about the ETH merge date. The last thing we will show here is question of has the ETH merged yet? And the answer to that question is?

• 9:21David Hoffman?

  Yes. Yes, it has. Binary yes or no? The answer is yes.

• 9:26Ryan Sean Adams?

  There's a website. There's a website you can go to if you want to confirm that and check that. HasETHmerge.com. In big letters, the answer to that question is yes, we've successfully merged. We'll get into that a little bit more further in the episode. But David, before we do, we should talk about macro right here. I think the question in macro markets is inflation is up. That sounds pretty bad. Stocks tumbled on the week. Here's a CNBC headline, Dow tumbles 1,200 points for the worst day since June 2020 after hot inflation report. June 2020, of course, was a day, I'm sure that was in the thick of

• 10:05Ryan Sean Adams?

  the COVID scare. So we're having a similar day here after a hot inflation report. Let me just recap the numbers from that inflation report. So let's go back to June. So annualized inflation in June, the numbers, the official numbers, 9.1%. And if you recall, that was the highest since 1981. We had a 40-year high. So no question in anyone's mind that inflation was running hot in June and the previous 12 months preceding it. July, 8.5% down a little bit, but still up, too close for comfort to the double-digit territory. August, the numbers we just got last week, the reason for this market tumble, 8.3%. So

• 10:50Ryan Sean Adams?

  you'd think that's down from July, David, on an annualized basis. But apparently, it was still larger than the market was anticipating. The average analyst expectation for inflation was 8.1%. And this came in at 8.3%. So 200 basis points over on inflation.

• 11:11David Hoffman?

  0.2% over expectations.

• 11:14Ryan Sean Adams?

  And that sent the market tumbling? That is apparently what people are crediting for the reason the market is tumbling. So this is the headline from CNBC.

• 11:25David Hoffman?

  0.2% over expectation inflation sent the market tumbling that hard?

• 11:28Ryan Sean Adams?

  This is what mainstream financial media is reporting as a hot inflation report. But I do think, David, we have to dig into these numbers a little bit further, right? Because, so first of all, let me just say, 8.3% still sounds really high. Like, don't we want to be in the 4%? Ideally, the 2% era, like 2 to 4. Maybe that's somewhat of the new normal. But you actually can't look at this from a 12-month annualized basis. Because the 12-month is really a lagging indicator. Here's a tweet from Tom Schmidt. Do you want to read this out? Tell us what this means.

• 12:05David Hoffman?

  Yeah, Tom says, "Not to be that guy again, but CPI is actually dropping month over month. I really do think that year over year is a very confusing way to report inflation, especially with the spikes in volatility we've had over the past two years." And there's a chart here showing inflation going up and up and up and up and up until June. And then it hits like, well, it looks like a ceiling. And we've been going very marginally down ever since. But the fact that we're not going up seems to be a decent trend over the last three months, according to this chart, which is coming out of the U.S. Bureau of Labor Statistics.

• 12:40Ryan Sean Adams?

  So this is Tom's larger point, which is you can't really look at annualized numbers when we're dealing with this level of inflation volatility because of all of the craziness that we've seen with COVID and economic sanctions and wars and all of these things. Like, these are sort of unprecedented times. And it doesn't make sense to look at 12 months in total. What we should maybe also be looking at is the monthly total. And inflation in August, just the month of August, not the last 12 months of August and preceding it, in August, it was 0.1%. And if you annualize that out, multiply that number by 12 months, right? To get the new annualized number, you get 1.2%.

• 13:24David Hoffman?

  Okay, so just to put those again into perspective. So August prices of assets or whatever, consumables that we measure inflation with, is up 8.3% year over year. But in the last month, at prices of like food, gas is only up 0.1%, which is not high, which is actually low.

• 13:49Ryan Sean Adams?

  And so I think the big question is, if inflation has peaked, what happens if the Fed over adjusts too far? You know, it's like, it's kind of like you're steering a car. It's starting, it's starting to wobble. You turn to avoid something and then you swipe back too far. You over correct in the opposite direction. And now you're in another lane of traffic, right? That lane of traffic might actually be deflationary forces. Okay, this is a tweet from Elon Musk saying, "A major Fed rate hike risks deflation." That's what he's talking about. If the Fed over corrects too much in the other direction. And I think the market is really tussling with this right now. And I mean, so are the central bankers, of course.

• 14:32Ryan Sean Adams?

  And I'm not, it's not very clear that they know what they're doing behind the steering wheel at this point.

• 14:39David Hoffman?

  And I guess there's precedent for this because the whole reason why we have inflation in the first place is because the Fed was too slow to increase interest rates in the first place. So it would go, it would continue to say that like, well, the Fed's also going to be too slow to stop tightening as well. Like, I feel like that's an easy Occam's razor take to have.

• 14:59Ryan Sean Adams?

  It definitely is. They just might not be prepared for the whiplash of the times that we're living in.

• 15:05David Hoffman?

  And Ryan, that's perhaps why we should have an algorithmically controlled monetary system and not a human controlled monetary system. Speaking of algorithmically controlled monetary system, Ryan, do you know what happened this last week?

• 15:18Ryan Sean Adams?

  Oh, did some algorithmically controlled money system just get an upgrade?

• 15:22David Hoffman?

  Yeah, did our money just get a software update? We're going to talk about that, how money is getting software updates these days. And of course, we're talking about the merge. So we're going to be, we're going to leave the Fed behind us. And we're going to go into the future, talking about the Ethereum merge, right after we talk to some of these fantastic sponsors that make the show possible. Lens Protocol is an open source tech stack for building decentralized social media applications. It is the new era for social media. We all have toxic relationships with our Web2 apps. We want to break up with them, but we can't. These applications own our digital lives and all the relationships that we've made. We need to break through to a new paradigm of social networking applications that we control, rather than them controlling us. Lens isn't a social media app. It's a protocol to let 1,000 Web3 social apps bloom. Lens is a permissionless and transparent social graph that is owned by the user.

• 16:07David Hoffman?

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• 16:52David Hoffman?

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• 17:10Ryan Sean Adams?

  Merged!

• 17:12David Hoffman?

  Merged?

• 17:13Ryan Sean Adams?

  We have officially merged, David.

• 17:15David Hoffman?

  We're merged?

• 17:16Ryan Sean Adams?

  This is a tweet from Vitalik Buterin, just some guy on the internet. "And we finalized", he said. He's talking about the finalization of the proof of stake chain. Happy merge, all. This is a big moment for the Ethereum ecosystem. Everyone who helped make the merge happen should feel very proud today. David, as we're recording, this tweet is sitting at 170,000 likes.

• 17:39David Hoffman?

  That's a lot of likes.

• 17:40Ryan Sean Adams?

  This is echoing around the internet, making this a historic event. I think earlier, David, you called this "the most historic event that crypto has ever seen". Maybe not the most important milestone, right? You'd hearken back to like the launch of Bitcoin as a more important milestone, or even the launch of Ethereum as a more important milestone. But an event is different. An event is something the entire world is watching, something that the community is anticipating. And I think this was the biggest event we've ever seen in crypto.

• 18:11David Hoffman?

  Certainly, like, how many people witnessed the launch of Bitcoin? Like, under five? How many people witnessed the launch of Ethereum? 10 to 15,000? How many people watched the livestream on the Ethereum Foundation YouTube last night? A quarter million people. And that's just the people that watched the stream. So like, a ton of people just watched Ethereum go through its transition to proof of stake. So this is the biggest event in crypto history in those terms. Like, the most number of eyeballs, the most amount of hype. And Ryan, it went off without a hitch. The merge was so incredibly smooth. It was absolutely successful. And just to clarify a term here, Vitalik is saying, "and we finalized."

• 18:56David Hoffman?

  That's actually a technical term. So the merge happens, as in, we hit that TTD number, that total terminal difficulty, that tells all of the Ether proof-of-work, Ethereum main chain, Ethereum execution layer clients, to start to stop paying attention to proof-of-work and start paying attention to proof-of-stake. That's the merge. But the merge isn't complete until we finalize it. And so that's about six minutes later. And we need that finalization to lock in proof-of-stake. Because once an epoch in Ethereum is finalized, that means to go backwards in proof-of-stake, you need to slash a huge proportion of Ether out there. And so it's one thing to merge, but it's really like final

• 19:37David Hoffman?

  when the Ethereum proof-of-stake chain finalizes the execution layer. And so that's really the celebration with that Vitalik's going for us. There is now the full weight of Ethereum proof-of-stake behind the Ethereum execution layer. So now going backwards on the chain, more than six minutes, results in billion dollars of slashing. And that is the economic security.

• 19:58David Hoffman?

  That we have all been excited about and then why the merge is such a big deal.

• 20:02Ryan Sean Adams?

  Billions of dollars of economic security. And David, I was looking at this earlier. Did you know that if you add up ETH, all the ERC 20s, all of the NFTs, we just forklifted a $400 billion economy. That is the size of the Ethereum economy and we just swapped that in real time. We swapped out the consensus engine, proof of work to proof of stake. And of course, one thing that the world might notice, and I think mainstream is taking note of, is the massive electricity consumption decrease. This is a tweet from Vitalik, he's quoting Justin Drake with a figure here. "The merge will reduce worldwide electricity consumption by 0.2%."

• 20:46Ryan Sean Adams?

  0.2%.

• 20:48David Hoffman?

  Crazy, crazy that it shows up.

• 20:50Ryan Sean Adams?

  Yeah, electricity use might have just been diminished last night with this event unfolding.

• 20:57David Hoffman?

  And of course, we reported on this last week, but Google knows about the merge. So if you type in the merge into Google, there's now, past tense, happened on September 15th, nine hours, 54 minutes ago. And instead of two bears walking towards each other, one black, one white, there is now a panda, very happy, cute looking panda, holding the ETH logo. So Google knows about the merge, the world knows about the merge, Ryan. Like this, this thing is echoing everywhere.

• 21:22Ryan Sean Adams?

  It's super cool that Google did that, by the way. I'm just, you know, it's awesome to see. Apparently there are a ton of Ethereum, a ton of even Bankless fans in the Google community. So if any Google employees are listening right now, shout out Google. Nice move here. It's good to see the solidarity. This is actually historic, historic moment, not just for crypto, but for the entirety of the internet as well. David, we're looking at a tweet about bordel.wtf. What is this?

• 21:51David Hoffman?

  Boredle was that website that everyone is looking at to predict when the merge is actually happening, right? It was the like, it's how we knew when the merge was gonna happen. And as we got closer and closer and closer, that thing just got hugged to death. So the numbers were that the Boredle dot WTF website was refreshed over 13 million times from 7 million unique IP addresses. Absolutely crazy. It crashed at the end. And so then I had to go and I had both Boredle and Ultrasound dot money open and then Boredle crashed. So I went to look at Ultrasound dot money and then moments later, Ultrasound dot money went down.

• 22:25Ryan Sean Adams?

  Because maybe you were displaying it? This is, are you talking about on the livestream?

• 22:30David Hoffman?

  I mean, I wasn't displaying mine, but just like everyone was looking at the same like four websites that were telling you when the merge was happening and like one by one by one, they all went down.

• 22:37Ryan Sean Adams?

  Yeah, all got hugged to death, huh? This is, these are some images as it was happening. David, what are we looking at here?

• 22:44David Hoffman?

  Yeah, this is the Ethereum Foundation offices in Denver and we have Danny Ryan on the far left facing away from the camera. You've got Tim Baker at the bottom. People just like sitting on the ground, like watching one TV. There's Austin Griffith holding up the phone on the couch on the right. There's Kevin Milwaukee in the bottom right corner. A few other people that I don't remember, don't recognize, but just a ton of people. A ton of these Ethereum development teams, people really close to the heart of Ethereum. All this like sitting around waiting for the merge to happen. And then here is a tweet from Raoul Jordan out of Prismatic Labs and he says, "When you meet on Reddit and four years later reduce the world's energy consumption by half a percent." Some fluctuation on the numbers here. And of course, this is Raoul Jordan and Preston Van Loon, two co-founders

• 23:27David Hoffman?

  of Prismatic who met on Reddit. I can kind of relate to this, you know, meeting co-founders on the internet. And they're celebrating the transition to proof of stake. These guys have just been putting their blood, sweat and tears into a fantastic Ethereum client out of Prismatic Labs. And so I'm sure these guys are just over the moon right now. Preston, I know particularly, has been itching to merge for a very long time. So congrats to both Raul and Preston here.

• 23:52Ryan Sean Adams?

  Yeah, he's absolutely been driving this forward. It's funny that how Web 2 facilitates kind of the meeting of founders and minds. In Web3, it's really an enabler of Web3. Like, they met on Reddit, you and I met on Twitter. I mean, so many people are like using Web2 tools, using the internet itself to build out the property rights layer, the next layer of the internet. That's cool. The other thing I would say about the developers, and I would always remind folks listening to, thank your developers.

• 24:23David Hoffman?

  Have you thanked a developer today?

• 24:26Ryan Sean Adams?

  Seriously, have you thanked a core developer? This is my thank you for these two individuals especially, because I remember when they stepped up to the plate in 2018, when it seemed like no one else was. I replied this under their tweet as a thank you. "I remember I thought ETH2 would never ship. Then Prismatic Labs stepped up and said, 'We're doing this.' No funding guarantees, you guys just started building. It was such a confidence boost to the ETH community during a difficult time. That was an epic bear market in 2018." And my sincere thanks to Raul and Preston Van Loom, and the Prismatic team, and all of the other client teams out there that made this happen. We wouldn't be here without you guys.

• 25:08David Hoffman?

  We would have nothing to talk about, yeah. So here is an interesting chart from quant.com, where if you click on one of these, you can just see the Ethereum hash rate dropped to zero.

• 25:18Ryan Sean Adams?

  Oh, wow.

• 25:19David Hoffman?

  Like, that is going from a very high number... Yeah, it's a price chart you don't want to see. But no, that purple line, that blue line, is the hash power of Ethereum. And you can see it starts to dwindle off up to the moment of the merge. And then the merge happens, and it just goes to zero. This absolutely goes to zero. There's a subreddit, rethermining, which was actually a subreddit I frequented quite often back in my mining days. And here's a guy playing bagpipes while he shuts off his mining rigs, which I thought was just hilarious.

• 25:53Ryan Sean Adams?

  There still are some at-home miners, huh? A few of them?

• 25:56David Hoffman?

  Yeah.

• 25:56Ryan Sean Adams?

  This looks like a basement somewhere.

• 25:58David Hoffman?

  There's a decent number of hobbyist miners left in the world, even after their margins have gotten compressed. If you haven't ever gone down the mining rabbit hole, just cruising down our ether mining, it's kind of like an interesting expedition into the world of mining. But now it is a relic of the past.

• 26:14Ryan Sean Adams?

  Yes, your services are no longer needed. And the miners-

• 26:18David Hoffman?

  Your watch has ended.

• 26:19Ryan Sean Adams?

  Will need to go somewhere else. Essentially, the holders of ether now become the miners of the Ethereum network through proof of stake. This is a tweet from Hsu. What are we looking at?

• 26:31David Hoffman?

  Yeah, so as the miners power down and shut off, MEV Boost is powering on. So Hsu says, "MEV Boost is live. So now we're waiting for a validator to request a block using the new builder API." And just a quick refresher on to what MEV Boost is, is that building a block can be intensive. You can do naive block building, is when you just take in a bunch of transactions that have a bunch of high fees. Or you can recruit the sources of a professional block builder that can extract some MEV from you and hopefully some optimum non-malicious MEV, which is what MEV Boost is doing. And so as soon as the merge happened, MEV Boost went live, saying, "Hey, you guys can, as stakers, as validators, can feel free to request blocks from MEV Boost

• 27:16David Hoffman?

  using the new builder API." And Hsu's tweeting here, saying, "We're waiting, waiting for validators to request blocks." And then a few moments later, if you scroll down, Ryan, he goes, "It happened, just landed in slot 47 million, the first ever block produced by MEV Boost." Apparently, there was also a war room with the FlashBots team. And then, right after that first block was created by MEV Boost, a second block was created after that. So MEV Boost, as miners shut down, MEV Boost is up and running. So congrats to the FlashBots team as well.

• 27:46Ryan Sean Adams?

  If you do not know what MEV Boost is, or what David was talking about just then, we've got some resources for you. So there's an episode that we put out with FlashBots on MEV Boost. Go check that out. Also, another episode with Matt Cutler. You can Google, just type in "bankless matt cutler." And you'll get that episode and learn all about MEV Boost. It's an important addition to the protocol. David, let's take a look at ultrasound money.

• 28:10David Hoffman?

  This is Oh, I've been itching to go here.

• 28:12Ryan Sean Adams?

  It's so good.

• 28:12David Hoffman?

  This is the best website now.

• 28:14Ryan Sean Adams?

  To see in a post-merge world, all of the stats. This is basically a dashboard of Ethereum's issuance, monetary policy, right? Ether, the assets, a dashboard for all of these things. Maybe we'll highlight a few things that my eye is immediately drawn towards the top. Of course, we are post-merged and the supply change since the merge went live is negative 203 ETH. I'm sure by the time people are listening to this, this will be far higher than it is right now. But what this means is ever since the merge was deployed earlier today

• 28:55Ryan Sean Adams?

  at the time of recording, we have been burning more ether than we've been issuing. So ether as an asset is officially ultrasound money. Burning more than it's issuing, it's deflating. The supply is not increasing for the first time ever. Supply of ether is actually going down. What does this mean, David?

• 29:18David Hoffman?

  It really is nice to see the first, where are we at? Like 10 hours of post-merge ether being net deflationary. I remember checking this when I went to bed and we were down to like negative 80 ETH. And there's actually been a moment inside of the last 10 hours where actually supply has gone up. So I think we immediately started burning like rapid, like right after the merge because of all the activity. I think we went down to like negative 100 ETH and then we went up to, up to negative 70 ETH. But then we started burning again because gas fees have gone up. But what really draws my eye, Ryan, is back up to that chart. Just look at that slope up to the merge. Look how steep that slope is.

• 29:58Ryan Sean Adams?

  Yes.

• 29:58David Hoffman?

  And that is ether issuance out of proof of work. And then the merge happens and the slope just stops. So it actually straight up looks like a mountain peak. And so a lot of, a lot of burning right at the start, a little bit of issuance. And then a lot, like something happened starting a few hours ago. And, and we are definitely net deflationary bigly. It's going to be, it's going to be interesting to watch. Can we maintain that net deflation moving forward into the future for how long? But like really, this is the time to really look at this website and like, look at these ultrasound money mechanisms.

• 30:30Ryan Sean Adams?

  As long as gas prices are above 15 Gwei average, we will be burning more ETH than we're issuing. That's what Ultrasound Money says as well. They've run the numbers around this. Total ETH supply is 120,500...

• 30:46Ryan Sean Adams?

  Total ETH supply is 125...

• 30:50Ryan Sean Adams?

  Total ETH supply is 120,520,000 and some odd ETH. And you wonder how high ETH supply will actually get. I know Justin Drake has predicted at times that we won't ever get beyond 122 million. It's just, you know, 2 million more. It could also be the case that we never get beyond 121 million, right? So we don't know where this is going to start and stop. The last thing I'll say on this, I think we'll be doing more on ETH monetary policy in the future. But if you want a friend in your life, maybe with a suit, somebody who's kind of financially minded, who looks at their assets and actually analyzes them. If you want them to understand the mechanics of Ether as an asset,

• 31:33Ryan Sean Adams?

  send them to Bankless, of course, give them, download some of our episodes on this. Also, send them to the ultrasound.money website. If they understand all of the numbers on this page and where they came from, I don't know how you can't be bullish after understanding all of this.

• 31:50David Hoffman?

  Yeah, that's a good point.

• 31:51Ryan Sean Adams?

  And so that is the place to send folks, particularly in this post-merge world.

• 31:56David Hoffman?

  And as we are recording, something is happening on Ethereum that is sending gas prices through the absolute roof right now, relative roof. Gas is up to 78 Gwei, 79 Gwei, and it's not because Ether is dumping. So something's happening on Ethereum. We started this segment at 203 Ether burnt. We are up to 214 Ether burnt. So we have burnt 11 Ether since starting to talk about this ultrasound.money website. And I think if we hang around here for a second, you're gonna, there it goes. 214, 218. We just burnt four more Ether since I started this sentence. This is so awesome.

• 32:32David Hoffman?

  And here's Hazu saying ETH is now the commodity money with the lowest rate of supply inflation. It's the number one. If you are a believer in stock to flow, the ether stock to flow number is like five, 10 times higher than Bitcoins right now is like breaking that metric. There is no commodity money with a lower rate of inflation than ether. So if that makes you bullish, you should be bullish. And here's a chart from Martin Koplman that is showing the block times of the last 100 blocks and you can clearly see when the merge comes in. Proof of work averages, you know, pre-merge averages one block every 13.6 seconds, but it averages that. And so it fluctuates around that all the time. And there was a

• 33:16David Hoffman?

  block that took, you know, something like, I think, two or three minutes up until the merge. Some blocks happen as quick as like two or three seconds. But then you see the merge happen and this very organized proof of stake system allows for blocks to happen extremely regularly every 12 seconds. And so that random block production that happens 13.6 seconds on average is now happening every 12 seconds with no fluctuation. There is that one little spike where somebody missed a block. And so that went from 12 seconds to 24 seconds. But that was like irregular, right? Every other block is at 12 seconds.

• 33:50Ryan Sean Adams?

  This looks like the heartbeat of an entirely different organism, you know, from proof of work to proof of stake. The pattern is completely different. Also, David, you were helping to host the live stream as proof of stake was going live and as the merge was actually happening. And you were saying earlier, there's between 40 to 50,000 concurrent watchers as the merge was occurring, over, you know, quarter million total views so far. And you had an opportunity to explain the merge in like one minute to all of these people. How did that feel?

• 34:28David Hoffman?

  Yeah, it was like, when we were organizing the call, they're like, David, do you want to explain what the merge is? And I'm like, I have been preparing for this my entire life.

• 34:38Ryan Sean Adams?

  Yes, I do want to explain the merge in the most simple, reductive way possible. Bankless listeners, tell me how I did, because here we go.

• 34:48David Hoffman?

  Proof of stake component of the beacon chain is like bumping out the proof of work miners for the Ethereum, the main Ethereum consensus. And so this merge, what we are all here for today on this stream is to watch the event where the beacon chain, the proof of stake consensus of the beacon chain becomes the actual consensus of the main Ethereum chain. And all of the various clients, there are many clients of Ethereum, there's different, instead of one canonical Ethereum, there's five, six, many different clients of Ethereum. And each one of these are syncing with each other and the beacon chain to all listen to the beacon chain all at the same time, all at the same, what is the TTD number, total terminal difficulty, a very large number.

• 35:32David Hoffman?

  And once we hit that number, all of a sudden, the main Ethereum chain will start to listen to the beacon chain instead of the miners. And in that moment, we will have merged with the beacon chain and become proof of stake. So Fitz, that is what the merge is, and that is why we are all here today on this live stream.

• 35:49Ryan Sean Adams?

  David, that was great, man. I think you did a great job there. There's also been some increasing-

• 35:53David Hoffman?

  Thanks, Tim. I've done it a few times.

• 35:54Ryan Sean Adams?

  Yes, you have. Bankless has trained you for this. There's also been increasing mainstream coverage, so maybe we should read a few headlines. The New York Times, "Can the Merge Save Crypto?" The headline of their article, "This is the verge. Ethereum just completed the merge. Here's how much energy it's saving." The subtitle is "A Step Into A More Sustainable Future For Cryptocurrencies." This is CBS News, "Ethereum's Merge Is Live. Here's What You Need To Know." I love in the beginning of this segment, I think they are showing an Elizabeth Warren tweet, maybe concerned about environmental impacts of cryptocurrencies, which goes away in the merge world.

• 36:36Ryan Sean Adams?

  Here's CNBC, "Ethereum's Massive Software Upgrade Just Went Live. Here's What It Does." David, we are breaking out into mainstream. Like we said earlier, this is the biggest event I think crypto has seen and the entire world has been watching.

• 36:48David Hoffman?

  Yeah, and of course, as we predicted, they're all talking about energy reduction, which is a valid thing to talk about. Energy reduction is 0.2% of all global electricity consumption. That's massive. And so, I mean, it's not the things that we get really excited about, but to each their own. If that's what's going to grab people's attention, that's what's going to grab people's attention.

• 37:09Ryan Sean Adams?

  Absolutely. It is a vital improvement. So if you are wondering what the projected APR is, this is, of course, some pre-merge projections, but I think could be fairly close to the money. We'll see how closely they live up to those expectations. 6.1% APR is the estimate put out by a Flashbots report based on the median estimated Ethereum staking yield given block space demand over the last six months. And this number, David, includes all of the block rewards for validators. It also includes MEV. So 6.1% might be a guess at where we start. Now, whether that holds, whether that goes up or down,

• 37:54Ryan Sean Adams?

  my guess is it probably heads in the direction of down, unless block space demand drastically increases and then maybe that number goes up. The reason it would head down is because I sort of anticipate more and more people will stake. Remember, staking at this point, guys, it's a one-way ticket. So you go in, you can't come back out. So it has to increase over time. It's not going in the other direction. But if block space demand, MEV fees, these sorts of things perform even better, we get kind of another bull run for block space demand, then maybe this number goes up as well.

• 38:30David Hoffman?

  And of course, David Mihal has another website for us to take a look at. He's, of course, the guy that created cryptofees.info, moneyprinters.info, layer2fees.info. You've seen us use his websites on the rollup all the time. There's now simplestakers.info, which is telling you all the different ways you can get APY on staked ETH derivative tokens. So Coinbase's CB ETH, Anchor, Lido, Stakewise, Rocketpool, all of the APY

• 38:58David Hoffman?

  You can get by holding that staked ETH token. But he's also included an extra little bit of data, which is also really helpful because these tokens, the Coinbase CB ETH token, actually trades against Ether, not necessarily one to one. So Coinbase CB Ether is trading against one Ether at 0.97, meaning there's a 3% discrepancy. And so David Mihal has also added the dislocation of the staked ETH derivative tokens versus Ether itself. And so if you buy that Coinbase CB Ether for 0.97 ETH for one ETH, you actually get an effective APY of 7.95% because you're buying that staked ETH token at a discount, at a 3% discount.

• 39:44David Hoffman?

  Really useful website. I'm wondering where he's getting this APY from because I'm wondering if the actual transaction fees are actually coming into this website because this kind of just seems like issuance. I'll have to ping David and ask.

• 39:57Ryan Sean Adams?

  Yeah, the other thing I think it's very important if you're evaluating where to stake, of course, is APY is only one side of the equation. The other side of the equation is risk. What you actually want to understand is your risk-adjusted rewards. And none of these APY websites, David Mihal or anyone else, can't really assess quantitatively the risk of some of these centralized staking providers. So just know that there's some risk. Listen to our episode with Justin Drake on censorship resistance if you want to find out more about that. Well, David, I think that wraps up the merge. This has been a historic week. We, of course, are very glad you could join us, Bankless Nation, in celebrating the Ethereum merge. Never going to happen again.

• 40:41David Hoffman?

  You only merge once, Yomo.

• 40:46David Hoffman?

  But if you are still itching for more merge content, there are some live streams and some videos that are available on the Bankless YouTube if you missed them while we did them live. But of course, coming up on Tuesday, I'm so excited for this one, Ryan. We are hosting Danny Ryan and Tim Baker, the two lead coordinators behind this whole entire merge effort on the state of the nation. Guess what the title of that episode is going to be, Ryan?

• 41:07Ryan Sean Adams?

  I think I know what it is.

• 41:08David Hoffman?

  Yeah. It's merged. Merged. Of course it is. So we're going to talk to these guys about like their journey to get to where we are today. And of course, what margarita they're drinking or pina colada they're drinking as they take a very well deserved rest from a bunch of just, I'm sure frustrating and exciting times in Ethereum. And then coming up after that, on the Monday podcast, the week after that, we have Vitalik for the next steps for Ethereum because there's still plenty of work to do. While it does feel like we got something finished, it also feels like this is just the beginning for Ethereum. And the optimism and excitement around the broader Ether community, I think, has got to be at all time highs, Ryan. I mean, how do you feel?

• 41:51Ryan Sean Adams?

  I'm absolutely thrilled, David. It goes to kind of, maybe I'll save some of this to the end of what I'm excited about. But this Ethereum community has really shown its strength and shown its metal. And I'm excited to be able to ship this important upgrade. I think it confirms a lot of the like the ETH thesis and the bankless thesis that we've been talking about so much on our show over the past couple of years. Speaking of Vitalik, though, coming up next, Vitalik somehow found the time to go to Ukraine?

• 42:20David Hoffman?

  Crazy.

• 42:21Ryan Sean Adams?

  Like just before merge week? We're going to talk about that. Also, Starbucks putting reward points on the blockchain? What's happening? What does that mean? And we tell you the crypto co-founder who's just been issued a warrant for arrest. All that and more coming up. First, we want to thank the sponsors that made this episode possible.

• 42:39David Hoffman?

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• 43:20David Hoffman?

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• 44:05David Hoffman?

  and $100 when you set up a direct deposit. This ad just writes itself, so go sign up at juno.finance/bankless. So somehow during the eve of the merge, the week or so before the merge, Vitalik had the time and the balls to go into the middle of a war zone, to go to a Kiev tech summit. It's also really nice to see that Kiev is hosting things like tech summits. But then Vitalik, of course, tweets saying, "Big thanks to the Kiev Tech Summit and everyone involved for the opportunity to visit an amazing and brave community in Ukraine that we all have a lot to learn from." And there's some pictures of him in Kiev at the Kiev Tech Summit.

• 44:43Ryan Sean Adams?

  I just want to emphasize, David, how badass this is of Vitalik. Okay, he's going to a conference in Ukraine, and it's wartime. And this was a hackathon that was hosted in a bomb shelter. And Vitalik both found the time and had the courage to fly over and talk to the developers in Ukraine. I just think that's such a stark contrast with a lot of the individuals that we see in the crypto space who are here. And I don't necessarily fault them. I mean, sometimes I do. If you're scamming someone, I fault you. But a lot of people aren't here for the mission. A lot of people are here for the money. They're here for the short-term opportunity. Vitalik, it's been clear, has never been here for that purpose.

• 45:28Ryan Sean Adams?

  And, you know, things like this prove it to us.

• 45:31David Hoffman?

  Yeah, absolutely. It's just surreal to watch him be like this monk figure, like walk around the world, as there are some people in crypto who have like four or five bodyguards. Vitalik is going with a single backpack to a war zone. Absolutely crazy. Anyways, on the other side of the world, Polygon tweets out, "Guess what's brewing today?" Starbucks unveils Starbucks Odyssey on Polygon. A unique experience that enables you to earn and buy digital collectible stamps and unlock new and coveted coffee experiences. So basically, Web 3, Starbucks is coming to Web 3, Ryan, through a loyalty program,

• 46:12David Hoffman?

  allowing customers and Starbucks employees to purchase digital collectible stamps in the form of NFTs. And it's all going to be done on Polygon. So loyalty token rewards on the blockchain?

• 46:27Ryan Sean Adams?

  That's kind of cool. It's, you know, brew to earn, I think is what some people are calling this. But, you know, here's a fun fact for you. I read this back in 2019. Did you know that Starbucks is actually one of the largest, is like a stablecoin giant? Like Starbucks cards, for instance, this is back in 2019, I'm sure they have more today, at 1.6 billion dollars in Starbucks bucks, right? They're basically like internal ledger stablecoins. And so you kind of start with NFTs, and I wonder if that leads Starbucks into kind of like payment and stablecoin issuance? And, you know, you could turn that Starbucks stablecoin into an ERC20, couldn't you? I'm not sure.

• 47:11David Hoffman?

  You're making some real crypto terms out of these things, just to make this real crystal clear. What's going on here is there are 1.6 billion dollars of credits that people have purchased in like Starbucks cards. So like you, you spend $20, $100, $1,000 to buy Starbucks points on a Starbucks card, right? And so that goes into a Starbucks bank account and they credit you with that $1,000, or whatever you bought on your Starbucks card.

• 47:38Ryan Sean Adams?

  That's a lot of coffee. A thousand dollars, David, yes.

• 47:41David Hoffman?

  Yeah, and so like they, the Starbucks, Starbucks is getting a yield on the money that you have credited them. And instead of owing you a dollar liability, they owe you coffee liabilities. And so they have all, they have 1.6 billion dollars in the bank and they owe. That and coffee to their customers, it's just kind of a crazy model. It goes to show like the larger and larger of a fintech or of yeah, as you get larger and larger, no matter what your business is, you ultimately turn into a bank. Like Carbox started selling coffee, but now it's just getting yield on customer deposits.

• 48:15Ryan Sean Adams?

  They're a coffee financing company.

• 48:17David Hoffman?

  Coffee financing.

• 48:20Ryan Sean Adams?

  Yeah, it's very interesting. I do think that there's a role to play here. But anyway, to say like, starting with NFTs, that's very cool and loyalty points, and then maybe maybe stable coins in the future as well. But speaking of NFTs, David, Solana NFTs are hitting all time highs. They're kind of having a moment right now. What's going on?

• 48:38David Hoffman?

  There was a big surge on Solana for NFT minting. So there were 300,000 mints on one day on September 7th, a spike out of nowhere. And I did like some two minutes of research to figure out what NFT drop this was. It doesn't seem to be like there was one particular drop. I could be wrong about that. So people that are more familiar with the Solana ecosystem can go check that from themselves. But it just seems like there it's like aggregate volume just surged for one day on Solana. Volume across all Solana marketplaces hit 11.5 million dollars on September 6th.

• 49:14Ryan Sean Adams?

  Cool. That's pretty impressive. I think Solana is getting definitely some strong traction in the NFT community. So we'll see where that goes next. While in contrast, while Ethereum is emerging and forsaking proof of work, abandoning proof of work for proof of stake. A couple last week before before this happened, the White House apparently just issued an environmental report on the impact criticizing the impact of cryptocurrencies like Bitcoin, saying that they could impede US efforts to combat climate change. And this report, David, came out of the White House Office of Science and Technology. And they said they recommended that the US take action to mitigate the pollution tied to crypto

• 49:59Ryan Sean Adams?

  production. Now, the report apparently stopped short of prescribing specific regulations. But this is definitely a shot across the bow for big. Bitcoin and the whole proof of work industry. It's kind of not Ethereum's problem anymore in one way. Because Ethereum is no longer proof of work, they're proof of stake. And I guess the Ethereum community could take a posture to just say, hey, it's not our problem, it's like proof of work's problem, Bitcoin's problem. And yet, this does seem to be some sort of stifling or government intervention on something that's happening in the free market. And I know there are different takes in the crypto community about this and in the Ethereum community about this. What's your take?

• 50:42Ryan Sean Adams?

  Do you think that there's a role for the federal government to like restrict use of energy in certain sectors or for specific reasons?

• 50:52David Hoffman?

  Yeah, no, definitely not. The government should not be determining what is good or bad use of energy. Yet, at the same time, I am like empathetic to the argument that like energy is more and more and more precious these days. Especially as like, you know, the world population grows, global warming continues. Like, we have to pick and choose our battles as to how we want our energy pointed. And I feel like that's where this, the White House Office of Science and Technology is really coming from. It's like, yes, there's a limited supply of energy in the United States that we have. Bitcoin is using a decent chunk of it. If Bitcoin grows, perhaps we should do something to make sure that there's more energy for other things as well.

• 51:37David Hoffman?

  I understand that perspective. But never should there ever be some sort of ban against proof of work? Or should there be a statement as to who gets to consume what energy?

• 51:47Ryan Sean Adams?

  Well, it's interesting, like the arbitrary nature of this. And I think proof of work advocates have talked about this before. Just like, why are you picking on proof of work? I mean, didn't you tell me, we had a conversation earlier this morning and you said some stat that resonated with me is like, did you know YouTube consumes more energy than Bitcoin?

• 52:06David Hoffman?

  By about like 33% or so.

• 52:09Ryan Sean Adams?

  So what if the US government said, hey, YouTube is consuming too much energy. It's just a waste of time. These are dumb like cat videos and bankless podcasts. Like, who cares? Let's just turn that off.

• 52:19David Hoffman?

  Podcasts, oh, turn it off.

• 52:21Ryan Sean Adams?

  Yeah, it's like clearly useless. And so I don't think I don't. My problem is not with some government policy around disincentivizing like or incenting kind of energy use in kind of greener ways. It's around the specific targeting of an industry. It's like, is it, it's not a better way to put kind of a blanket tax on all energy use to kind of curtail demand and accomplish a specific purpose? That way, you're not targeting like, you know, Bitcoin mining over Christmas lights. I mean, who's to say which is, which is more valuable? And to me, when you start to get into these political decisions, as you know, some bureaucrats

• 53:04Ryan Sean Adams?

  deciding what's good use of energy and what's a bad use of energy, you start to get into some real trouble. You lose the credible neutrality of the federal government. But so I do think I stand with Bitcoiners on that side of things and proof of work on that side of things, although I'm still of the Ethereum mindset of like, guys, you don't have to be using proof of work, right? Like, proof of stake is kind of better. So there's an element where I'm not going to fight it too hard personally.

• 53:33David Hoffman?

  One thing I am looking forward to is the Bitcoiner narrative is that Bitcoin consumes green energy and it doesn't get enough credit for all of the green energy that it consumes.

• 53:44Ryan Sean Adams?

  Right.

• 53:44David Hoffman?

  And like, I have a hard time understanding if that is like a classic Bitcoiner narrative that like, kind of just like chant the chant about, or if that's actually backed up by data. And so I'm, I'm a fan of this topic surfacing because I would love some clarity on that from more people, both inside the Bitcoin camp, that's not just the cyber hornets that attack me on Twitter, and also outside of the Bitcoin camp from like more people that like don't have a dog in the fight. Although I'm not saying the White House will necessarily be biased. I'm just saying, I would love clarity on this statement. Is Bitcoin, does Bitcoin mining incentivize green energy? I used to be a fan of that argument. I'm becoming less and less of a fan of that argument as time goes on.

• 54:25Ryan Sean Adams?

  Yeah, I agree. And if you can eliminate it entirely, it's, it's hard to see how that is not better.

• 54:31David Hoffman?

  Yes. The greenest thing to do is to just not consume energy, but Bitcoiners will take offense to that.

• 54:37Ryan Sean Adams?

  Meanwhile, Michael Saylor doesn't care. He is buying more Bitcoin. MicroStrategy files to sell up to-

• 54:43David Hoffman?

  Doesn't he have taxes to pay?

• 54:44Ryan Sean Adams?

  I think so. MicroStrategy files to sell up to 500 million of stock to fund more Bitcoin purchases. Wow.

• 54:52David Hoffman?

  That is insane, dude.

• 54:53Ryan Sean Adams?

  It's definitely ballsy. You gotta give him credit for that. This is like, or maybe you don't. Maybe you could, maybe you could say it's like, you know, fiduciarily irresponsible to investors in MicroStrategy. But it's certainly interesting.

• 55:11David Hoffman?

  I mean, I can't knock someone for being a permable, I guess, so.

• 55:15Ryan Sean Adams?

  I, I still contend, David, that this will-

• 55:19David Hoffman?

  Play out.

• 55:19Ryan Sean Adams?

  This will play out for him. And-

• 55:21David Hoffman?

  This is gonna lower his average, his cost basis by such a big number.

• 55:27Ryan Sean Adams?

  Well done. Buy and lower. I guess. I mean, 500 million of stock to fund more Bitcoin purchases. Absolutely incredible.

• 55:35David Hoffman?

  This is, this is an interesting headline out of Zero Hedge. China back amongst the top 10 countries in Bitcoin usage despite the Bitcoin ban. And so even though Bitcoin is banned in China, it has resumed its top 10 position, I believe, in number 10. Number 10 as the country that uses Bitcoin the most. Cool.

• 55:57Ryan Sean Adams?

  You can't ban crypto. I mean, that's the takeaway, right?

• 55:59David Hoffman?

  You can only ban your citizens from accessing crypto and apparently not even that.

• 56:03Ryan Sean Adams?

  Speaking of banning, the Tornado Cash saga continues. OFAC just updated their frequently asked questions, so I of course- I of course, uh, read them. I wanted to get some of the highlights. We'll show that in a minute, but I've got good news for you, David.

• 56:19David Hoffman?

  Yeah?

• 56:19Ryan Sean Adams?

  You and I might not be going to jail.

• 56:21David Hoffman?

  Oh, thank God. I was worried.

• 56:23Ryan Sean Adams?

  And here, here's the thing. So there was a-

• 56:25David Hoffman?

  Every time there's a knock on my door, I'm like, oh, sweet.

• 56:28Ryan Sean Adams?

  There was something that happened like, I was at four or five weeks ago. Right now, of course, uh, you know, Tornado was put, smart contracts were put on the OFAC sanction list. And then somebody dusted a whole bunch of public influential ETH addresses, including Jimmy Fallon, Steve Aoki.

• 56:47Ryan Sean Adams?

  Logan Paul, all the exchange CEOs, Brian Armstrong, Vitalik, you, me, the rest.

• 56:54David Hoffman?

  Bankers thought ETH, and what Ryan means by dusted is that somebody sent .1 ETH to all of these addresses from the Tornado Cash contract, making them in violation of the OFAC rule.

• 57:05Ryan Sean Adams?

  Exactly, and without our consent, very clearly, be like if somebody sent a, you know, an envelope to your help.

• 57:12David Hoffman?

  Robbed a bank and then deposited that money into your account.

• 57:14Ryan Sean Adams?

  Yeah, exactly, or if they sent, exactly, they robbed a bank and deposited money into your account, and then, are you a criminal or not?

• 57:22David Hoffman?

  Right.

• 57:23Ryan Sean Adams?

  That's, that's the question, and of course, you and I think that would be absolutely ludicrous for Treasury and for OFAC to take that posture. Well-

• 57:30David Hoffman?

  Although I'm totally willing for people to rob banks and them to put that money in my account. I'm totally down for that.

• 57:35Ryan Sean Adams?

  You should not say that on a podcast, sir. This is a FAQ, OFAC trying to clear this up. Do OFAC reporting obligations apply to dusting transactions, the issue that you and I just mentioned, and it starts by saying, OFAC is aware of these things, and I'll read the statement here. Technically, OFAC's regulation would apply to these transactions. Okay, so if somebody robs a bank, deposits it into your bank account, it's your problem, David, your problem. Somebody takes from Tornado Cash and sends it to your ETH address without your consent, without even your knowledge, it is your problem technically. That's what OFAC's position is. To the extent, however, these dusting transactions have no other sanctions

• 58:20Ryan Sean Adams?

  nexus besides Tornado Cash, OFAC will not prioritize enforcement against delayed receipt of initial blocking reports and subsequent annual reports of blocked property from such US persons. Okay? What they're saying here is, technically, it's a crime.

• 58:38Ryan Sean Adams?

  Okay, but we're gonna lower the priority through which we prosecute this crime.

• 58:44David Hoffman?

  So we're at the end of the list is what you're telling me.

• 58:47Ryan Sean Adams?

  That's what they're saying. And it is asking as well, I think the reading of this is they somehow want anyone who received some dust to file a report with OFAC.

• 59:00David Hoffman?

  Yeah, I'm not gonna do that.

• 59:02Ryan Sean Adams?

  Absolutely, it's an absolutely, it's an absolutely unbelievable position to take. Here are some more of the frequently asked questions. One was, what is prohibited as a result of OFAC's designation of tornado cash? And OFAC has clarified that if you're a US citizen and you do anything with tornado cash, you are prohibited from doing that as a result of OFAC. And then they make this statement.

• 59:30David Hoffman?

  That's not new, though.

• 59:31Ryan Sean Adams?

  Yeah, that's not new, but they're clarifying this, but I found this funny. The tornado cash website has been deleted from the internet.

• 59:38David Hoffman?

  What a statement. They said that out loud?

• 59:41Ryan Sean Adams?

  But it currently remains available through certain internet archives. So don't worry, guys. The tornado cash website has been-

• 59:49David Hoffman?

  The powers that be removed it from the internet. Do not look at the man behind the curtain. Oh my god, the audacity.

• 59:58Ryan Sean Adams?

  Yeah, it's just-

• 59:59David Hoffman?

  You didn't delete it from Ethereum, bro.

• 1:00:01Ryan Sean Adams?

  You can't delete the tornado cash website from the internet either. Do you remember, there was a, Beyonce did a Super Bowl halftime show one year, I don't know, this is like, seven years ago or something like this. And there was like this terrible picture of her that was posted where she was in this really awkward dance position. And like after the fact, her PR team, her crew was trying their utmost to like delete Beyonce's picture from the internet. That is a fool's errand. You can't delete things from the internet. That's not how this stuff works.

• 1:00:32David Hoffman?

  It's the Streisand effect.

• 1:00:34Ryan Sean Adams?

  Anyway, that's some of the language coming through from OFAC. So, you know, clearly, there will be court cases about this, and we'll have to get some clarity in the court system, because these are not tenable, these are not reasonable positions. To say that if you get a dusted transaction, yeah, you're still doing something illegal. We're just gonna put you at the end of the list in priority.

• 1:00:57David Hoffman?

  We'll talk to you later.

• 1:00:59Ryan Sean Adams?

  Yeah, like, we could still come after you at any time. Just, you're not gonna be at the top of the list. Like, what is that? How is that tenable in a free and open society?

• 1:01:08David Hoffman?

  Didn't Matthew Green restore the tornado cash contracts to a new version on GitHub?

• 1:01:13Ryan Sean Adams?

  He did.

• 1:01:14David Hoffman?

  I'm gonna go download those and put them on my wall behind me.

• 1:01:16Ryan Sean Adams?

  They did say that that is actually legal. So that was another FAQ.

• 1:01:21David Hoffman?

  So it's not deleted from the internet?

• 1:01:23Ryan Sean Adams?

  They were talking about the user front end, by the way. They're not talking about the actual code. They did understand that much. They were talking about the website in itself. Yes. It specifies that.

• 1:01:33David Hoffman?

  A website has since been deleted from the internet?

• 1:01:35Ryan Sean Adams?

  The tornado cash website, yes.

• 1:01:39Ryan Sean Adams?

  But of course, that can be hosted on IPFS. That could be, like, you can't really delete the website. But yes, they did clarify that if a US citizen copies and paste,

• 1:01:50Ryan Sean Adams?

  you know, and hosts the tornado cash code in a Gitcoin repository somewhere, that is not illegal, according to them.

• 1:02:01David Hoffman?

  Well, I was gonna put it on my wall anyways, regardless of whether it's legal or not.

• 1:02:05Ryan Sean Adams?

  That was always allowed, apparently.

• 1:02:06David Hoffman?

  That was always allowed.

• 1:02:09David Hoffman?

  Speaking of things where people are actually getting in trouble for doing illegal things, Do Kwon now has an arrest warrant for his arrest in South Korea. So a court in Seoul issued a warrant for Do Kwon and five others, alleging that they violated the nation's capital markets law, which I don't know what that means, sounds very broad. But yeah, I bet there's something in there where, like, if you are responsible for imploding $50 billion of capital, that you probably broke some law somewhere. And so, yeah, there is a warrant out for his arrest. DoKwon has said that he plans to cooperate when the time comes. And he said that in this crypto interview media startup Coinage,

• 1:02:52David Hoffman?

  when he floated the prospect of jail time to DoKwon. And DoKwon finished saying, "Life is long." Meaning that like, "I got a lot of life to live, so I might as well just like go to jail and pay this time and just go through it." Okay.

• 1:03:08Ryan Sean Adams?

  It's incredibly stoic. We'll have to see where that ends up. And not only DoKwon, it was five others.

• 1:03:14David Hoffman?

  Five others too.

• 1:03:15Ryan Sean Adams?

  Involved in the company with DoKwon. So that's happening. Meanwhile, the SEC in the US is setting up a new office where you can come in, tell them about your crypto project. This is going to be called the Office of Crypto Assets. So the statement here from the SEC is, "As a result of recent growth in the crypto assets and the life sciences industries, we saw a need to provide greater and more specialized support." The SEC is coming up with an office, apparently, where you can go and talk to them. I have yet to hear of a case where that's actually been useful for a real world crypto project that is trying to get some clarity on the asset class and their position with respect to the asset class. I don't know. It's kind of a, speak of untenable positions.

• 1:03:59Ryan Sean Adams?

  It seems like an untenable position for the SEC to want to take leadership in crypto in the US and like not provide any framework where it's legal or any clarity where we can do these kinds of things in a legal way. They're taking a very hostile approach, while also saying that they want to be like the place where you can come in and have a nice conversation with them. I mean, these things very much seem at odds. So until they fix that, I'm not sure that this will provide a lot of clarity or use for people building things in the real world in crypto.

• 1:04:32David Hoffman?

  Yeah, I want to make fun out of this, because that's usually my default response. But they do say that as a result of the recent growth in crypto, we saw a need to provide greater and more specialized support. More specialized support is what we have been asking for. So like, I can't knock that. Like, keep going down that path. But like still call me skeptical, right? Like, I wouldn't want to be the first or second or third organization to walk in through that office. I'm just kind of getting like Dolores Umbridge vibes.

• 1:05:05Ryan Sean Adams?

  Just come to my office.

• 1:05:07David Hoffman?

  Yeah, step into my office and then like you're Harry Potter and you're like writing scars into your hands like, "I will not issue illegal securities" or something.

• 1:05:15Ryan Sean Adams?

  Look, there's an element to that. And just to contrast that with another US executive branch agency, the CFTC, which has been much more welcoming to the crypto agency and kind of like talking about what is possible rather than all the things you cannot do and providing a much more clarity in the field of commodities. So that's a good contrast point. But Coinbase is starting to fight back even more. This was a really cool move. "Starting today from Brian Armstrong, Coinbase will begin integrating our crypto policy efforts right into our app. These will help..."

• 1:05:50David Hoffman?

  So Chad.

• 1:05:51Ryan Sean Adams?

  I know. "These will help our 103 million verified users get educated on crypto positions held by political leaders where they live." And this is Brian showing a video of what the app looks like. And you can actually see, like, here is a Democrat from District 9, New York City, and her crypto sentiment is positive. You can see Caroline Maloney, a Democrat, New York District 12. Her crypto sentiment is negative. It displays all of these things inside of the app so that the 103 crypto users of Coinbase can actually see where their politicians stand on this. And the idea is, I think Brian was pretty explicit.

• 1:06:32Ryan Sean Adams?

  "For instance, US users can see crypto sentiment scores from members of Congress," he says. And then he says, "Over time, we want to help pro crypto candidates solicit donations from the crypto community." He's being very explicit about this. Why are we doing this? Because this will drum up donations from a base who wants the ability and right to own crypto in their jurisdiction, does not want unfair laws and legislation against crypto.

• 1:07:02David Hoffman?

  This is so awesome. Like Brian and Coinbase is just building piping of crypto money into crypto positive legislations in an easy to use app. My God, is that going to move the needle so much? And so like, imagine being a senator and you're like, you're seeing this like rating app of your, of your, like how loving you are to this particular industry that is so like where crypto is so important to them that they're putting it in the main crypto app, the Coinbase app.

• 1:07:37Ryan Sean Adams?

  I know.

• 1:07:37David Hoffman?

  Right. It's built into the most consumer friendly app of all time. Just like, does this person support or not support crypto?

• 1:07:45Ryan Sean Adams?

  David, all that's missing, and I don't know the legality of doing this, but all that's missing is a button that says donate to this politician. Look at Richie Torrey's Democrat, New York District 15 is very supportive. Nice button there. Imagine.

• 1:07:57David Hoffman?

  Donate.

• 1:07:57Ryan Sean Adams?

  Donate, donate now.

• 1:07:59David Hoffman?

  Like Coinbase already has all of your KYC information. So they could just pass that along because you need to do that. And if you're going to donate to somebody, like the infrastructure is already there. And I was talking about this, I can't remember where, on some podcast livestream. I've been on a million livestreams in the last like four days. Crypto has the two things, and we've talked about this before on Bankless, has the two things that legislators want and need the most. Single issue, highly motivated voters and money. And Coinbase is the host of a 104 million people who have money and care about crypto. And now they're being piped in directly to like these congressmen and women. I expect this to be such a huge help to the industry at large. Coinbase, Brian.

• 1:08:43Ryan Sean Adams?

  Yeah, well done. This is huge. This is, yeah, big supporters of this. This is Coinbase showing up, I think, for crypto and DeFi in a way that we need most. And if you don't think we need this, I would encourage you to go back and listen to what we just said about OFAC and tornado cash.

• 1:08:59David Hoffman?

  Right.

• 1:09:00Ryan Sean Adams?

  David and I received a Dustin transaction.

• 1:09:05Ryan Sean Adams?

  And OFAC says, "We did something illegal."

• 1:09:08David Hoffman?

  Yeah, we're criminals.

• 1:09:08Ryan Sean Adams?

  That's what they said in their FAQ. I mean, that's just not tenable. And the only way we have to fight against this is money and votes. And that's what Coinbase is hoping to provide the crypto communities, the knowledge to allocate that money and those votes to the right places. So we can push back on some of these unelected bureaucrats saying, "We don't have the right to on-chain privacy." So yeah, big plus one on that. David, what are we looking at here?

• 1:09:36David Hoffman?

  This is a website that I wish was around in 2017. It's called token.onlocks.app. And it's basically just being a reporting service for token unlocks. So that is like angel, seed investors, like seed rounds, like if Series A, Series B. Token supplies are locked because of vesting schedules, right? So if you're an early investor, you get your token locked up so that it can start to trade on the secondary market. And that thing doesn't go to zero because all the early investors who got it for very cheap are locked up for a certain amount of time. And so this website is just aggregating all of that information of how much of the token supply is locked? What are the next supply unlocks? What is that date? How much is getting unlocked? What's the circulating supply?

• 1:10:19David Hoffman?

  What's the fully diluted valuation? And so if you are worried about, if you are, you should just include this in your basic due diligence anytime you're ever going to buy a token. So like usually if I'm going to buy a token, I start on CoinGecko and I start to look at some of that data. But I think I would now go here next because I would then want to find out, what is the unlock schedule? Like, is this thing like 90% liquid or 90% locked? And if it's 90% locked, like when's the next unlock coming? Who's going to dump on me? This is basically like, the token website, of course, I'm going to repeat it, token.onlocks.app could also be renamed, "Are People Going to Dump on Me app." And so you can go check on like if people are going to go dump on you or not.

• 1:11:02Ryan Sean Adams?

  Yeah, it's great to see this transparency coming to crypto. And I think it's something that I've not seen in stocks. So it's kind of neat to see this in crypto. Single dashboard, we can view all of this. This is some news coming out of Abra, which is a crypto bank based in the US. They say, today, we are announcing the formation of Abra Bank, the launch of Abra Boost, which is Abra's new staking and yield offering. And so this is Abra actually becoming a US state chartered bank, which is a full bank, not a trust, in the digital asset space, giving them the ability to do trading, custody, investing, NFTs, credit cards, and more. And here's the justification, according to their CEO.

• 1:11:45Ryan Sean Adams?

  Abra intends to be the premier web three and crypto bank in the world. While we believe in the ethos of not your keys, not your coins, we recognize that consumers and institutions need help navigating crypto. Enter Abra Bank. This, to me, I think, is a narrative that we'll see. There have been some banks that survived 2022, some crypto banks, right? And they did things because they were, you know, much more prudent, much less risk-seeking than the Celsius's of the world, didn't make mistakes like BlockFi. And I do think we're going to see a resurgence of crypto banks. And the resurgence, I'm hopeful, David, that these crypto banks will have learned their lesson from 2022,

• 1:12:28Ryan Sean Adams?

  become much more transparent, become much more DeFi-friendly. And I do think that there is a role for them to play as a risk. Not everyone can go completely bankless from day one. And so we need sort of a, you know, a bridge at times in the meanwhile. So I'll be monitoring the progress of Abra and what they're doing there and like crypto banks in general.

• 1:12:51David Hoffman?

  Yeah, with the power of crypto, new banks can just be better than the old banks. And it's as simple as that. Moving into the world of Binance Chain. Ryan, did you know Binance Chain is actually doing ZK rollups?

• 1:13:03Ryan Sean Adams?

  Ah, yes.

• 1:13:04David Hoffman?

  Crazy. So Binance Chain announces the testnet launches of ZKBNB, the first ZK rollup on the Binance Smart Chain. So ZK tech is not easy. And so like, there must be a pretty good team behind this to, and of course, Binance Chain has the second most, second largest DeFi ecosystem after Ethereum, and they're generating a decent amount of fees. So it actually makes sense that a ZK rollup would eventually come to Binance Chain. So Binance Chain becoming modular.

• 1:13:32Ryan Sean Adams?

  ZK technology is definitely not just for Ethereum. It's for any kind of modular blockchain. Now, the weird thing about deploying this on Binance is because you'd think you'd want a fully decentralized settlement layer in order to scale your layer.

• 1:13:48David Hoffman?

  Well, you would think you would want that in the first place. I think we're already, that ship has already sailed.

• 1:13:51Ryan Sean Adams?

  That ship has already sailed. We'll watch to see what emerges there. A new wallet, a bankless custody style wallet, self custody wallet called Plasma Wallet has just arrived. I've not tested this myself, but.

• 1:14:04David Hoffman?

  It looks polished.

• 1:14:05Ryan Sean Adams?

  It does look polished. In fact, I think I saw an image of the Bankless podcast in one of these screenshots. You see that, David?

• 1:14:11David Hoffman?

  Oh, wait, really?

• 1:14:12Ryan Sean Adams?

  Yeah. I'll spin this around here.

• 1:14:14David Hoffman?

  Wait for it to roll back.

• 1:14:15Ryan Sean Adams?

  Is that us? Weekly rollup.

• 1:14:17David Hoffman?

  Oh, wow. Holy shit. That was last week's merge. I mean, or weekly rollup.

• 1:14:21Ryan Sean Adams?

  We have not tried this.

• 1:14:22David Hoffman?

  I love this wallet.

• 1:14:23Ryan Sean Adams?

  Yeah. We have not tried this. I don't know too much about their team, to be honest, but if you are on the frontier and want to try a new non-custodial wallet, go check it out at plasma-wallet.com. Let us know what you think, and it's great to see more innovation in the space.

• 1:14:40David Hoffman?

  And lastly, the Opera browser is now supporting MetaMask and other third-party wallets. And so if that has been the blocker for you to use Opera, because Opera didn't support MetaMask, well, that blocker is gone. You can now support MetaMask inside of Opera. And moving into the raises this week, Doodles coming in at a Massive $704 million valuation.

• 1:15:04Ryan Sean Adams?

  Wow.

• 1:15:04David Hoffman?

  After raising $54 million.

• 1:15:06Ryan Sean Adams?

  Does that feel like a bear market valuation to you?

• 1:15:08David Hoffman?

  Does not feel like a bear market valuation. Almost a billion dollar valuation coming in from Alexis Ohanian, 776, FTX Ventures, and a few others as well.

• 1:15:21David Hoffman?

  I'm not sure how I would feel as an NFT owner if the centralized team raises money. I might feel like I'm the product here, but to some degree, like that's kind of what people might want, if that's their vibe.

• 1:15:33Ryan Sean Adams?

  This is kind of the Board Apes model, right? Versus like crypto.

• 1:15:35David Hoffman?

  Yeah, definitely like the Board Apes model, yeah.

• 1:15:37Ryan Sean Adams?

  There's a place for it. These valuations, though, are absolutely insane. I'm not sure what they're based on.

• 1:15:41David Hoffman?

  Right.

• 1:15:42Ryan Sean Adams?

  Hopefully, these investors know what they're doing here, and good luck to the Doodles team.

• 1:15:46David Hoffman?

  And the other raise of the week, Koopa Troopa announces Coop Records Fund Number One. Cooper Turley, raising $10 million early-stage fund, investing in the next generation of music and music NFTs. Cooper, of course, is known as the music NFT guy. And actually, this last week, Brian, during all of the merge hype, during all of the other live streams and podcasts that I did, managed to get Cooper on the show.

• 1:16:11Ryan Sean Adams?

  Oh, did he really?

• 1:16:12David Hoffman?

  For a 20-minute episode as to what is, what are music NFTs? And I think the crypto community, the crypto Twitter community, has always been like, kind of teasing Cooper as like, why would I buy a music NFT? Like, what does it do for me?

• 1:16:25Ryan Sean Adams?

  Yeah.

• 1:16:26David Hoffman?

  And his answer has always been a collectible.

• 1:16:28Ryan Sean Adams?

  Yeah.

• 1:16:28David Hoffman?

  But he gave me a line that I actually really liked, which was, "Don't overthink it. You need 25 people to buy a music NFT at .1 ETH to equal a million downloads on Spotify." So, music NFTs don't need to be much.

• 1:16:44Ryan Sean Adams?

  It's just the 100 super fans.

• 1:16:46David Hoffman?

  100 super fans that need to buy your music NFT. You can think about utility later, you can think about access later, but like, how squeezed the margins are for artists is so bad that Cooper's answer is, "You just need 25 people to buy your music NFT to generate an equivalent amount of money for the artist as a million dollar, or million downloads on Spotify."

• 1:17:08Ryan Sean Adams?

  Good luck to Cooper.

• 1:17:09David Hoffman?

  I got, I got music NFT pilled.

• 1:17:11Ryan Sean Adams?

  Did you really?

• 1:17:11David Hoffman?

  So, congratulations to Cooper. I'm really optimistic to see this guy's, this guy's future.

• 1:17:14Ryan Sean Adams?

  Yeah, I mean, he's, he's definitely been doing a lot in this space. I guess maybe that's advice, don't overthink it. A $700 million doodles valuation. Don't overthink it, David. Maybe it makes sense. Bankless Jobs. This is our weekly time to remind you that we're in a post-merge world. The first time we're talking about getting a job in crypto and Ethereum is 100% proof of stake at this point. Those things don't have anything to do with one another.

• 1:17:42David Hoffman?

  I was about to say.

• 1:17:43Ryan Sean Adams?

  I just wanted to say it one more time. Here are the jobs of the week. I'm going to read a few out. On the Bankless Jobs Board, Molecule is hiring a head of engineering. Bankless needs a growth marketer. That's us.

• 1:17:54David Hoffman?

  Bankless needs a growth marketer. It's non-tactical and it's dope.

• 1:17:57Ryan Sean Adams?

  Yes. Economia needs a lead designer. Silent Protocol. Full stack smart contract engineer. Superform, senior backend engineer. Bitgreen, full stack engineer. Messari, software engineers. They need two of them. Root needs a head of fundraising. I could go on, but you can find all of these jobs on the Bankless job boards. Bankless.pallet.com/jobs. Sign up. You'll get these in your inbox. Wow. We got more coming up, David. What's in store next?

• 1:18:23David Hoffman?

  We got the takes of the week. There are four of them. And of course, David and Ryan get to talk about during Merge Week, what we are bullish on. I wonder what that could possibly be. But we're going to get to all the takes in the week, also some merge-related takes and more as soon as we talk to some of these fantastic sponsors that make this show possible. ZK Sync is an Ethereum Layer 2 network that is pushing the frontier of high-performance blockchains that don't compromise on security or decentralization. ZK Sync has combined the power of zero-knowledge rollups and the Ethereum virtual machine, enabling developers to build the greatest Web3 projects possible, ones we haven't even seen yet. Crypto needs its killer applications to onboard the world, but crypto killer apps need ZK Sync as a platform to build on first.

• 1:19:06David Hoffman?

  It's generally accepted that zero-knowledge rollups are the conclusion of crypto blockchain scaling technology, and ZK Sync is leading the charge into the final frontier of crypto economics. So if you're a developer who wants to build your app on a future-proof foundation, which gives your users the best UX possible, check out ZK Sync's website at zksync.io. And yes, there's also going to be a token, so give them a follow on Twitter too, @ZKSync. 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-trained 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.

• 1:19:50David Hoffman?

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• 1:20:20Ryan Sean Adams?

  All right, guys, we are back with the takes of the week. Here's the first from Fubar. "Post-merge, the most important improvement that can be shipped..." Talking about Ethereum, "isn't proto-Danksharding, though that's plenty useful, it's enabling withdrawals. Because making it as easy as possible to withdraw from centralized custodial staking pools is critical to validator decentralization." I do think that enabling withdrawals is the next feature to come in the roadmap, anyway, from a priority perspective. But there is some element that the developers have talked about before, where they would combine withdrawals and proto-Danksharding together in the same hard fork. And I think Fubar is kind of making the case like,

• 1:21:05Ryan Sean Adams?

  "Don't do that, not if it costs us time." Because what we need right now is to enable withdrawals. And he's making the case for decentralization purposes. That's the reason we need to enable withdrawals. What do you think?

• 1:21:18David Hoffman?

  Yeah, and just to elaborate on this, deposits into Coinbase, deposits into Lido, when they stake this Ether for you, it's fixed, because there aren't withdrawals. So all Ether and Lido is stuck there. And so if we have centralization concerns, like Coinbase or Lido has too much Eth, we need to enable withdrawals so we can get that to be jumbled up and mixed around with the others taking as a service providers. I'm not a developer, but I don't think the withdrawal hard fork is all that complicated. So I could definitely be in support of expediting this update. Yeah, for sure.

• 1:21:55Ryan Sean Adams?

  Same, same here. We'll see how that evolves. I think the core devs are taking a much-needed break for a little bit.

• 1:22:01David Hoffman?

  Yes, yeah. Let them have a margarita and then we will pester them about when withdrawals.

• 1:22:05Ryan Sean Adams?

  Just come on a few weeks, okay? We can't ask for withdrawals right away. Not this week, anyway. Now, this is a take from you, David. "The Ethereum never ships" narrative, in quote, is dead, you say. Skull, crossbones. Why is that dead?

• 1:22:19David Hoffman?

  So this has been the narrative, that Ethereum just is like a bunch of vaporware and never is, never gonna ship proof of stake, it's never gonna ship scaling, it's never gonna ship, it's never gonna ship. And at this point, we've shipped proof of stake, we created and then shipped EIP 1559 inside of that time, we have scaling on layer twos. The only thing left is data sharding, and it's like the less complicated update in comparison to the merge. And so, the Ethereum never, doesn't ship narrative is now dead. And so, if you are the person who is claiming that Ethereum doesn't ship stuff, of which there are plenty of these people, like, the onus is on you to prove that that update that's coming of whatever we're gonna talk about, isn't coming. Like, it's no longer on the

• 1:23:03David Hoffman?

  responsibilities of like the Ethereum community or Ethereum developers to convince you that Ethereum ships. We've now proven it out on the, in the biggest of ways. So the Ethereum never ships narrative is dead.

• 1:23:14Ryan Sean Adams?

  I think a bunch of narratives have been kind of slayed as a result of the merge. In fact, we did an episode earlier this week with Justin Drake on 15 bad takes that you should, you should definitely listen to. I think the merge kind of...

• 1:23:28David Hoffman?

  One of them's already done, which is the merge will never ship.

• 1:23:31Ryan Sean Adams?

  It sticks a fork in a lot of those, in a lot of those takes, for sure. This is my take. Do you wanna read this out?

• 1:23:37David Hoffman?

  Yeah, sure. Ryan Sean Adams says, "With a shedding of proof of work, Ethereum is fully charting its own course, inspired by, yet distinct from Bitcoin. From here on out, Ethereum is no longer living in Bitcoin's shadow. Little brother is all grown up." Ryan, what did you mean by this?

• 1:23:55Ryan Sean Adams?

  I think that for all of Ethereum's life, it's been somewhat living in the shadow of Bitcoin. It's been kind of the little brother. All of the attention is on elder brother Bitcoin, who's off going to college and he's, you know, the football quarterback, the captain, like, you know, everyone cares about big brother. And little brother has been kind of living in big brother's shadow and somewhat like copying some of the moves of big brother.

• 1:24:20David Hoffman?

  Yeah.

• 1:24:21Ryan Sean Adams?

  More and more Ethereum has kind of diverged from the Bitcoin roadmap. Of course, at Genesis, the big divergence was expressive smart contracts on the base layer. That certainly has been true. And, you know, now with the merge, I think it's, it's fully charting its own course. The origination of Ethereum at the time, the best technology available for a consensus layer was proof of work. It's no longer the case. And so Ethereum had to copy Bitcoin in the early days, but now it's clearly charting its own course. And I do think this opens up an opportunity, David, for Ethereum to take kind of the, the main flagship role, right? Always much respect to the older brother, who's gotten us this far,

• 1:25:06Ryan Sean Adams?

  but it's time for Ethereum to kind of live its own life and do its own thing. And I think the world needs Ethereum to take center stage in this whole crypto movement as well. And I, I, I see this merge as kind of a milestone and a key point at which the trajectory changes. And the industry's focus is more slanted on Ethereum moving forward versus Bitcoin. I don't know if everyone sees that, but that was certainly my takeaway from, from the merge event. And maybe it'll be seen that way historically as well.

• 1:25:36David Hoffman?

  Absolutely. This is a very different way to express my ETH BTC trade.

• 1:25:43Ryan Sean Adams?

  Little brother. Little brother's gonna become stronger.

• 1:25:47David Hoffman?

  Yeah, Ethereum finally decoupling from his bigger brother. Yeah.

• 1:25:51Ryan Sean Adams?

  Personify take there.

• 1:25:52David Hoffman?

  This is my favorite take that we've ever put on the weekly roll up, I think. Yeah, Vitalik dot e, Vitalik Buterin says, normalize saying dub instead of W as the name of the letter W. He follows and says, all letters deserve a one syllable name. So Vitalik is saying, we should change, we should, we should fork the English language, and we should merge in a new pronunciation of the letter W, and we should change it to dub, which I am a huge fan of. That is a great take.

• 1:26:25Ryan Sean Adams?

  Why? Okay, so all of the other letters in the alphabet are one syllable, is that correct?

• 1:26:29David Hoffman?

  A, B, C, D, E, F, G. Yeah, I think so, yeah.

• 1:26:33Ryan Sean Adams?

  Okay, but then we have this W that just sticks out like a, like a sore thumb.

• 1:26:37David Hoffman?

  Yeah, you have U, and you have W. How do you think W feels in comparison to U? It's like, oh, I'm just like two of U's. Like, no, I'm dub.

• 1:26:46Ryan Sean Adams?

  Okay, but I don't know if that flows as well in the song. Because like, we need two syllables.

• 1:26:51David Hoffman?

  T, U, V, dub, X, Y, Z.

• 1:26:53Ryan Sean Adams?

  We need three syllables.

• 1:26:53David Hoffman?

  That's fine.

• 1:26:54Ryan Sean Adams?

  Dub, X, Y, Z?

• 1:26:55David Hoffman?

  Dub, X, Y, Z. Yeah, that's fine, that flows. Dub, X, Y, Z.

• 1:26:59Ryan Sean Adams?

  I don't know. I don't know. I don't know if I support this Vitalik take, David.

• 1:27:03David Hoffman?

  How old's your youngest kid?

• 1:27:04Ryan Sean Adams?

  Eleven. She's 11 right now.

• 1:27:06David Hoffman?

  Okay, yeah, too late, too late to indoctrinate her with new ABCs.

• 1:27:10Ryan Sean Adams?

  Yeah, I think it's passed for this generation. You have to like, start from scratch. I don't know. Yeah, my parents will never go for this, David.

• 1:27:17David Hoffman?

  Yeah.

• 1:27:18Ryan Sean Adams?

  What are you bullish on this week, man? I know the answer, but tell me, anyway.

• 1:27:22David Hoffman?

  I'm bullish on what I feel like is the next era of crypto. It really feels like that was Ethereum proof of work is like Ethereum beta. I know, I know we kind of tease Alana for being a beta mainnet. But like, if they can call themselves beta, I'll call Ethereum proof of work beta. And now like Ethereum proof of stake, layer twos, sharding, soon TM. Like it really, but that proof of stake thing is so critical, that this really feels like the way that Ethereum has always been meant to express when it was envisioned back in 2014. And so with, with proof of work, with like, the dark cloud of proof of work energy consumption and supply over, supply sell pressure, it really feels like we're

• 1:28:04David Hoffman?

  in a new paradigm of crypto. Not just for Ethereum, but you know, we all know that like crypto as an industry trades like alongside Bitcoin. Well, that's because Bitcoin's proof of work, Ethereum has been proof of work up until now. And so the, it has been a proof of work paradigm ever since. Ethereum is currently one half of Bitcoin's market cap and that magnitude of market cap is now proof of stake. And so this part of crypto, the decentralized finance part is under a new paradigm. It's a new era of crypto. And so it really just feels like a zero to one moment for the crypto industry. And it's going to take time for that to like show up in market prices and show up in activity. But like this is what this is the version of crypto that I've been waiting

• 1:28:46David Hoffman?

  for and been here for for years now. And it's finally arrived. So Ryan and Bullish on a turning of the page for the industry.

• 1:28:53Ryan Sean Adams?

  I really like that. And you know, I jot it down as I was listening, some of Vitalik's first comments in the post merge, somebody asked him on the call post merge, and he said this about the merge, I think Hudson Jameson asked me, how are you feeling? Like, what does this mean? He said this, "To me, the merge symbolizes the difference between early stage Ethereum and the Ethereum we've always wanted." Right? That's the kind of that shift, a new era, a different, a new change. So yeah, that resonates with me as well.

• 1:29:23David Hoffman?

  Ryan, what do you both run? Is it similar?

• 1:29:26Ryan Sean Adams?

  You know, this is, I guess I could say similar, right? It's just definitely kind of merge related. But let me, let me zoom out and talk about this in the context of my own personal crypto journey, and maybe like the bankless journey as well, because those things are kind of intertwined. I feel like we have just closed a major chapter, David, for Ethereum, as you just said, the end of an era and the entrance of a new era. Also for bankless at some level, also for me, my own personal thesis. Do you know, you and I, many others in the Ethereum community, were very early chanters of this meme that we started in, you know, 2018, ETH is money, ETH is money. Let's talk about this asset for its monetary properties. And the reason that was so important

• 1:30:09Ryan Sean Adams?

  to us was not number go up. It was because we saw this fundamental link between the value of Ether and the economic security of these of the network. And those things could not be severed, right? And it didn't make sense to think about a valueless ETH, right? It was all kind of one unified theory of the world, right? And so we were chanting this and had been chanting it at nauseam for the last few years. And that kind of evolved into like ultrasound money, the monetary premium properties of ETH. Do you know what, David? I feel like I don't have to say it anymore.

• 1:30:42David Hoffman?

  Yeah.

• 1:30:43Ryan Sean Adams?

  I feel like-

• 1:30:43David Hoffman?

  It's a part of their DNA.

• 1:30:45Ryan Sean Adams?

  Just, I'm a miner, man. Now my watch has ended too. I don't have to say it anymore. It's not, I am going to talk about it. I am going to say it from time to time, ETH is money, this ultrasound money. But you know, from here on out, there's no more pushing that we have to do. It's just gonna freaking happen. Why? Go to ultrasound.money. Just go to that website. You'll just see it happening.

• 1:31:06David Hoffman?

  Like one of the best websites in crypto.

• 1:31:08Ryan Sean Adams?

  There's nothing the social layer has to do to make this happen anymore. It's now, it's gonna happen on its own. And as the economics become more obvious, more people will accept the fact that Ether is an internet bond, Ether is a store of value that's not issued by a nation state, that's issued by an internet protocol. Like, the entire thesis, all the stuff we've been talking about. And at some level, David, this is why we started Bankless. Because this story hadn't been told very well. The story of DeFi, the story of going bankless, the story of ETH is money and the value that this network could bring. Now I just feel like it's, it's done. It's like, my watch has ended.

• 1:31:52Ryan Sean Adams?

  So, I think moving forward, you and I don't have to actually focus as much on getting the story out as of ETH is money. Of course, we're going to. Of course, it's going to be important. But this is also entering another chapter. And it's just gonna happen, with us or without us. With the community's support, or without the community's support because it's now, it's fully baked into the algorithm itself.

• 1:32:16David Hoffman?

  Right, yeah. The values have been indoctrinated, instantiated in the actual code. And once it's there, it's really hard to get it out. And that's been the whole purpose ever since. And so I think that really just like begs the question, like, alright then, what's next? What's the next thing to talk about?

• 1:32:32Ryan Sean Adams?

  Are we done? Is Bankless done?

• 1:32:34David Hoffman?

  Well, no. I think there's plenty left to talk about. And one of the ways I've always described Ethereum versus Bitcoin is that Bitcoin, the blockchain, is meant to serve BTC, the asset. Like, all the surrounding infrastructure is meant to do one thing, which is preserve the 21 million hard cap of Bitcoin. Ethereum is the inverse of that, where Ether, the currency, is actually just meant to support Ethereum, the economy. And we know that Ethereum, the economy, doesn't only exist on the Ethereum Layer 1 now. Like, it's, the economy's escaped and it's got, it's escaped into the Layer 2s. And so, now I think the story to be told- Ethereum's rollup-centric roadmap, we see this story manifesting itself with Arbitrum Nova and Ethereum finding its way into Reddit, right?

• 1:33:18David Hoffman?

  That's what Arbitrum Nova is, is the Ethereum escaping out of the Layer 1 and building a chain that's specific for Reddit. And that's the Ethereum rollup-centric roadmap. And so I think this next era of Ethereum is now that Ethereum has taken care of itself, it's gotten its security properties and its monetary properties on lock and like that thing is, you know, tie a bow on that and like that's the way that it's good to go. The rest is building rollups, Layer 2s and Layer 3s, custom fit for different corners of the internet and putting economies and money and bankless tools in all corners of the internet. And I think that's the final frontier of Ethereum now that we are post-merge.

• 1:33:57Ryan Sean Adams?

  Yeah, I totally agree. And I think some of our content will begin to reflect that. We've still got to have a few more episodes, of course, on the merge coming up, but yeah, I'm super excited to enter into like the second chapter of not only Ethereum, but also bankless and start to explore these brave new frontiers. David, we've got a meme of the week. What are we looking at right now?

• 1:34:19David Hoffman?

  We are looking at this meme of the crying TikTok dancer girl. So she is, for some reason, bawling your eyes out while doing a TikTok dance. And the caption is miners staking their ETH post-merge. And so if you're a miner who's collected that ETH and you are now staking it, yeah, you might be sad that your mining business is gone. But hey, at least you're staking ETH and that's why this crying TikTok girl is doing the TikTok dance.

• 1:34:45Ryan Sean Adams?

  She's still dancing, even with tears in her eyes. She's still dancing, not giving up. Guys, as always, gotta end with risk and disclaimers, of course. Ether is risky, so is Bitcoin, so is all of crypto. You could definitely lose what you put in, but we are headed west. This is the frontier. There are new frontiers unfolding. It's not for everyone, but we're glad you're with us on the bankless journey. Thanks a lot.

• 1:35:11David 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, Ask Me Anythings, and weekly rollups where we summarize the week in crypto and other

• 1:35:56David Hoffman?

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