ROLLUP: Coinbase vs Apple | Crypto Market Bottom Signals | Genesis Fallout | SBF Scandal | Reddit NFTs

2nd Week of December 2022 ------ 📣 Opolis | Get 1000 $WORK and 1000 $BANK https://bankless.cc/opolis ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/?utm_source=banklessshowsyt 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ ------ BANKLESS SPONSOR TOOLS: ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum ❎ ACROSS | BRIDGE TO LAYER 2 https://bankless.cc/Across 🦁 BRAVE | THE BROWSER NATIVE WALLET https://bankless.cc/Brave 💠 NEXO | CRYPTO FINANCIAL HUB https://bankless.cc/Nexo 🔐 LEDGER | NANO HARDWARE WALLETS https://bankless.cc/Ledger ⚡️FUEL | THE MODULAR EXECUTION LAYER https://bankless.cc/Fuelpod ------ Topics Covered 0:00 Intro 5:43MARKET 5:50 BTC Price 6:10 ETH 6:25 ETH/BTC 7:45 Total Crypto Market Cap 8:10 Jim Cramer Urges Investors to Exit Crypto https://www.cnbc.com/2022/12/05/jim-cramer-urges-investors-to-exit-crypto-its-never-too-late-too-sell.html 10:30 8% of Americans Have Positive View of Crypto https://www.cnbc.com/amp/2022/12/07/just-8percent-of-americans-have-a-positive-view-of-cryptocurrencies-now-cnbc-survey-finds.html 11:51 Record Discount https://twitter.com/tier10k/status/1600866841366519808 13:15 COIN at Lows https://imgur.com/VTPMqV0 15:00 Token Bible 16:15 The Stablecoin Bull Thesis 19:30 Last 30 Days $3.4B Moved Off Exchanges https://twitter.com/WClementeIII/status/1600225887986647040 20:23 Price & Dev Activity Cosmos https://twitter.com/tokenterminal/status/1600812061663330305 ETH https://twitter.com/tokenterminal/status/1600889990439133184 25:00 Coinbase vs. Apple Coinbase Wallet vs. Apple—bad apple https://twitter.com/CoinbaseWallet/status/1598354819735031809 31:55 Genesis Owes $900M to Gemini Customers https://www.theblock.co/post/191928/genesis-owes-900-million-to-gemini-customers-financial-times 32:50 Genesis Resolution May Take Weeks https://www.theblock.co/post/192946/genesis-says-plan-to-resolve-lending-units-woes-could-take-weeks 33:30 SBF Cont. 33:35 Nic Carter https://twitter.com/nic__carter/status/1600213106965086210 33:11 SBF & Maxine Waters WTF https://twitter.com/RepMaxineWaters/status/1598693811252875264 39:05 Meme https://twitter.com/owocki/status/1599877959975772160 39:30 Forensic Investigators are on the Case https://www.coindesk.com/business/2022/12/08/ftx-bankruptcy-managers-hire-forensic-investigators-alixpartners-wsj/ 40:09 Taylor Swift Denies SBF https://www.ft.com/content/2b0601e2-d371-404d-8531- 227f11d4a83f https://twitter.com/RyanSAdams/status/1600616288757358598 43:10 Kevin O’Leary Got Paid $15M to Shill https://twitter.com/GRDecter/status/1600858962555179010 44:55 Investigation into the SEC as to how they missed FTX https://twitter.com/AlexanderGrieve/status/1600492078852603916 48:00 ETH 48:05 Shanghai HF discussion in March https://www.coindesk.com/tech/2022/12/08/ethereum-developers-target-march-2023-for-release-of-staked-ether/ 50:35 Long Tail Contagion 50:40 Orthogonal Trading and Maple Finance https://www.coindesk.com/markets/2022/12/05/crypto-markets-today-ftx-fallout-hits-maple-finance-bitcoin-declines/ https://www.theblock.co/post/192097/maple-finance-default-orthogonal-trading 53:15 Nexus Mutual Hit with $3M Exposure https://decrypt.co/116510/nexus-mutual-hit-with-3m-in-ethereum-exposure-to-orthogonal-trading-default 55:10 Gitcoin and Unicef! https://go.gitcoin.co/blog/gitcoin-unicef-qf-collaboration-pilot 56:35 Aztec @ 50k ETH Shielded https://twitter.com/aztecnetwork/status/1599882747660509184 59:12 NFTs 59:15 Toys R Us Launching Digital Collectibles https://twitter.com/ToysRUs/status/1598364984127414273 1:00:00 Reddit Collectibles Minting Hit ATH https://www.theblock.co/post/191984/reddit-digital-collectible-minting-hits-all-time-high 1:00:50 Cockpunch Trailer & Launch https://podcasts.apple.com/us/podcast/c%C3%B8ckpunch/id1657210471 https://opensea.io/collection/cockpunch 1:02:30 Bankless Collectibles https://collectibles.bankless.com/ 1:03:55 Tax Loss Harverstooooor https://nftlossharvestooor.com/ 1:06:35 Policy 1:06:40 a16z Taps Former CFTC Commissioner to Run Washington Efforts https://twitter.com/CoinDesk/status/1600082693127020544 1:07:20 Nexo to Depart U. S. https://www.coindesk.com/policy/2022/12/05/nexo-to-depart-us-after-regulator-discussions-hit-dead-end/ 1:09:25 ChatGPT https://twitter.com/AltcoinPsycho/status/1598742302050357248 https://twitter.com/GRDecter/status/1599804597090279424 https://pbs.twimg.com/media/FjY033HXwAAbj3E 1:16:25 Releases 1:16:27 New Ledger Just Dropped https://shop.ledger.com/pages/ledger-stax 1:18:20 PleasrDAO Auction House https://pleasr.house/ 1:19:25 JOBS https://pallet.xyz/list/bankless/jobs 1:22:11 Questions from the Nation https://twitter.com/yogofubi/status/1600561157794062336 https://twitter.com/nextalphaa/status/1600583036176896029 1:29:30 TAKES 1:29:35 Enabling Halal Alt-L1s https://twitter.com/JimmyRagosa/status/1599712746374713344 1:33:44 Alfalfa Leak -Vitalik https://twitter.com/vitalikbuterin/status/1599780254616547331 1:34:40 What Are We Bullish On? 1:40:55 MEME of the Week https://twitter.com/WrongNebula/status/1598832120675213312 1:42:34 Closing & Disclosures

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

• 0:00David Hoffman?

  This is one of these tweets where like I just like I just sit and pause and be like, who the, who the hell is this Ryan Sean Adams man? My mind goes to like, all right, he's an AI, so he just like did Google searching and came up with this. So that would, that's just normal. Or he's a Taylor Swift fan and like have this one ready to go. Or he's a, he's a dad of a, of a teenage daughter.

• 0:22Ryan Sean Adams?

  It could all be all three things at once. We just don't know. And I think you have to be comfortable, David, if we're going to see this podcast every week is living in that ambiguity. Do you know, like, you just don't really know.

• 0:34Ryan Sean Adams?

  Bankless Nation, happy second Friday of the month. David, tell them what time it is.

• 0:39David Hoffman?

  Oh, it's the Friday Bankless Weekly Rollup, where we cover the entire weekly news in this goddamn bear market, which is an especially ambitious endeavor, yet we persevere. Nonetheless, no matter what corner of the globe we're tuning in from, which is a little bit different for me this week, Ryan. It's one of those things.

• 0:53Ryan Sean Adams?

  Yeah, you're West Coast. You went left coast.

• 0:56David Hoffman?

  West Coast David's back, yeah. Back in the beautiful, beautiful city of San Diego. Yeah. Much to the demise of my mother that I didn't decide to go back to Seattle.

• 1:05Ryan Sean Adams?

  Yeah, you went a little south of, of your mom, but you know, she could always meet you in San Diego, right? It could be a rendezvous point.

• 1:12David Hoffman?

  Yeah, that would be insulting to her.

• 1:13Ryan Sean Adams?

  Okay, so the intro though, you said bear market, but we sounded so like, like upbeat and enthusiastic. And I felt some energy there, like I feel, okay. Do you know what I feel coming to this episode, David, is like a weight has been lifted off my shoulders? I feel light. November was not a great month for crypto.

• 1:33David Hoffman?

  No, that was a bad, that could have been the worst month ever, in fact.

• 1:36Ryan Sean Adams?

  Do you know how you feel like after, you say you feel after you fast for a couple of days? You got kind of the energy, you got, I don't know.

• 1:43David Hoffman?

  Yeah, I call it, I call it my manic David. Yeah.

• 1:45Ryan Sean Adams?

  Yeah, manic David.

• 1:46David Hoffman?

  In a good way, in a good way.

• 1:47Ryan Sean Adams?

  Yeah, once in a while, not in a Kanye, Kanye West way, but like once in a while, you know, you'll DM me and you'll be like, it's, yeah, I got some ideas. I'm like, okay, it's manic David. I don't say that. I'm like, it's fasted David. Anyway, that's a little bit how I feel. I feel like we've got detoxed and like, I'm just feeling, even though it's a bear market.

• 2:06David Hoffman?

  Clarity and thought, like long-term.

• 2:10David Hoffman?

  Time horizons, yeah, just like fundamental optimism. Yeah, okay. All right.

• 2:14Ryan Sean Adams?

  Excited about 2023? Are you feeling that vibe or is it just me?

• 2:18David Hoffman?

  I want to get to 2023 so bad, not because time is a construct, but like, I don't know, June, January 1st, 2023, like, can we get there, please? Because then everything just goes away and we just reset, right?

• 2:31Ryan Sean Adams?

  All right. Yeah, yeah, it goes away. We could forget 2022.

• 2:34David Hoffman?

  SBF is in jail, crypto prices are up only. This is what I'm promised.

• 2:38Ryan Sean Adams?

  We get some sensible regulation for DeFi past. Who else? Vitalik is elected president. No, he can't. He's Canadian. I don't know, man. A lot of good things maybe in 2023. We'll see. All right, let's talk about the topics of the week, though.

• 2:51David Hoffman?

  This is the state of the bear market where we just make shit up, dude.

• 2:55Ryan Sean Adams?

  No, this is a real thing that happened. Apple versus Coinbase. Apple thinks it can tax crypto, David. Someone, who's going to tell them? Who's going to tell them that they can't tax ETH gas fees? We're going to talk about that.

• 3:06David Hoffman?

  No one seems to be able to tell Apple no, which is kind of the crazy thing. And so we're going to have to talk about that. Also, we got some data, some fallout, some actual numbers to talk about when it comes to contagion out of Genesis and Gemini earn. So we'll give you the numbers that we heard that was reported. And then also, coming in hot, you'll never guess, Ryan, who SBF hired as a lawyer. I kind of feel like this, this whole SBF story is coming to a close. I might have said that before on previous rollups, but like, everyone, last week, we were confused as to what the hell SBF was doing on his like, public tour of talking to everyone. Now I feel like we kind of know what he's up to and that we've got some clarity there. So that's what, that's what's coming up in the big news of the week.

• 3:50Ryan Sean Adams?

  And he's got his lawyer. You don't, you don't hire a lawyer when things are going well. So we'll see who that is in the show. You'll never guess the name. It's pretty crazy, actually. Hey, but before we get into it, got to shout out our friends and sponsors at Opless, who have a very special message for the bankless nation. They want to provide you with healthcare going into 2023. That's real important. If you're a contractor, if you're working for a DAO, tell them what Opless is and what are they offering today for bankless listeners?

• 4:17David Hoffman?

  Because of the burdens of nation state employment and other things in this life that we live, things like healthcare, things like payroll taxes, working on the frontier of Web 3 is difficult. How, as a DAO worker, or as an NFT artist, or as, I don't know, a yield farmer, do you access? Well, yeah, if you don't, if you don't have a company that you work for, but you're making money, how do you get healthcare?

• 4:43Ryan Sean Adams?

  It's all of us.

• 4:44David Hoffman?

  Healthcare in the United States is super expensive, especially as an individual. So Opus is a co-op for all the Web3 workers on the frontier who want to band together in Web3 fashion to come and Opus will negotiate for advantaged rates on your behalf. Opus, it's a co-op, so that means when you sign up for Opus, you also become an owner of Opus. And Opus just does things to help you with your burdensome nation-state infrastructure that you need. Again, healthcare, payroll taxes, all this kind of stuff. And there is a link in the show notes to get started. And if you get started, if you get going with Opus by December 31st of 2022, so that's like 20 days, you'll get 1,000 work, the token for Opus, and 1,000 bank tokens.

• 5:28David Hoffman?

  So do allow Opus to help you do what you do best, which is explore the frontier, but with healthcare.

• 5:36Ryan Sean Adams?

  Web3 workers unite. That's what we need. A lot to build, and so we need a lot of work to get done. David, let's talk about markets before we get into building. What is Bitcoin looking at this week? We got the happy music or sad?

• 5:49David Hoffman?

  Bitcoin, it's got no music. It is flat. It is super flat on the week. Up, down 0%.

• 5:56Ryan Sean Adams?

  Like literally 0%?

• 5:58David Hoffman?

  Yeah, it was, it came pretty damn close to 0%. Yeah.

• 6:01Ryan Sean Adams?

  And so what is that? What number are we looking at? About 17,000?

• 6:04David Hoffman?

  Yeah, the number, 17,000. 17,000 Bitcoin.

• 6:07Ryan Sean Adams?

  It's also like 17,000 even. That's pretty crazy. How about ETH, up or down?

• 6:12David Hoffman?

  Sad, sad sounds for ETH. Down 2.5%. Started the week at 12.90, ending the week where it currently is at 12.50. Although it is surging as of this morning, up to 12.57.

• 6:23Ryan Sean Adams?

  All right, well, I can calculate the ratio in my head. I bet it's down 2.5%. Am I right?

• 6:28David Hoffman?

  That's about right. That's the correct math. This is math that I can understand. Yeah, my ratio is down about 2.5% on the week. We are down to 0.074.

• 6:37Ryan Sean Adams?

  No real signal right now. We're just hanging out in December. This is interesting. A flat week is interesting in these types of markets. So do we feel like this is consistent with what we believe has been the case where the last domino has kind of fallen or it's, you know, it's wobbled and we kind of know the contagion that's already happened and we're getting into this flat period of time? What do you think?

• 6:58David Hoffman?

  Sorry, I just got distracted by Trading View because I have it open on my phone. ETH just pumped to 1283. So we are only down 1.5% on the week, Ryan.

• 7:09Ryan Sean Adams?

  Again, none of this will matter by the time you listen to it.

• 7:11David Hoffman?

  Why do we do this?

• 7:13Ryan Sean Adams?

  I don't know, but we're going to keep doing it. Every week we'll tell you 24-hour out-of-date numbers and, you know, you can enjoy them or not.

• 7:22David Hoffman?

  Is this emblematic of, so yeah, you know, bad news, but it's, it's going on like still, like everyone hates crypto, out, risk regulation, all that stuff, but prices are flat. I feel like that's a pretty acceptable sign of like strength. Bad news, but flat prices equals some signal of strength. Yeah.

• 7:39Ryan Sean Adams?

  Yeah, flat prices is better than down prices. That's the kind of analysis you guys tune in for.

• 7:47Ryan Sean Adams?

  All right, we are under a trillion too. What's the crypto market cap? Give us those numbers, David.

• 7:51David Hoffman?

  Can you hit refresh? So we're at 884 billion. If Ryan hits refresh, 889 billion. Look, we just added 5 billion onto the market cap, putting us at flat on the week because last week it was 890 billion.

• 8:03Ryan Sean Adams?

  Flat on the week. There we go. Flat, flat, flat. It's a flat week, which is okay in a bear market to have. It's better than the alternative. David, we've got to talk a little bit about the bottom signals because that's really what folks are listening to. And I think we've talked about it in the section of markets, the last couple of rollups. And we got some more bottom signaling stuff. You decide.

• 8:24David Hoffman?

  Bottom signals are abound.

• 8:25Ryan Sean Adams?

  Are these bottom signals or not? You don't really know until they're like for sure a bottom, but some hypothesis. The ultimate bottom signal caller is Jim Cramer. If he tells you to sell, you better buy. You better, it's probably a bottom. And Jim Cramer. Kramer, of course, this is the host of Mad Money, who you know and love, the great stock predictor. He says, "Investors should exit crypto," in quotes. "It's never too late to sell," is what Jim says. I don't know, I'm super bullish after I'm hearing this from Jim Cramer. What's your take on this?

• 8:59David Hoffman?

  So crypto Twitter and just FinTwit just make so much fun of Jim Cramer because he is the herd. He is the herd mentality. He is the middle of the curve. And like, he told people to buy coin at 450 when it IPO'd. Like, he has all of these terribly wrong takes. And actually, if you think about it, Ryan, his business model for Mad Money makes sense. Because he's trying to get-

• 9:22Ryan Sean Adams?

  Attention?

• 9:23David Hoffman?

  Attention, eyeballs.

• 9:24Ryan Sean Adams?

  Yeah, it's not about ROI.

• 9:26David Hoffman?

  He doesn't want, if you are contrarian, you don't want to be a contrarian as like, uh, somebody who's trying to get eyeballs as like a TV show, right? You want to dish out what everyone wants to hear. If you're trying to have maximum reach, maximum broad reach-

• 9:39Ryan Sean Adams?

  You want to have consensus opinion.

• 9:41David Hoffman?

  You want to have consensus opinion. And that, if you just have consensus opinion in the markets, you're not going to do well. Being smart in the markets is about having contrarian bets. So this is not just a meme. This is like, it's aligned with his business model for Mad Money. So, Jim Cramer urges investors to exit crypto. It's never too late to sell. If you want to be a contrarian, you would do the opposite.

• 10:00Ryan Sean Adams?

  I actually think that's a good take on Jim Cramer. It's not that he's always wrong. It's just that he is emblematic of consensus opinion. And this is consensus opinion. He says-

• 10:10David Hoffman?

  Because his takes change every two weeks.

• 10:12Ryan Sean Adams?

  It's never too late to sell an awful position. And that's what you have if you own these so-called digital assets, an awful position.

• 10:20David Hoffman?

  Lumping every single digital asset together.

• 10:23Ryan Sean Adams?

  They're all the same and it's never too late. I mean, this is how people get totally wrecked on the dips here. Anyway, maybe a bottom signal. Here's another one, David. What are we looking at here?

• 10:31David Hoffman?

  Just 8% of Americans have a positive view of cryptocurrencies now. A CNBC survey finds, this is published on December 7th on Wednesday. And when I read this article, Ryan, I was just so reminded of 2018 of just like positive view of crypto in 2017, very negative view of crypto in 2018. It's just consensus. It's just the herd mentality. So if you're telling me that only 8% of Americans have positive views of crypto like that just sounds like a bottom signal. And of course, the survey is happening right after FTX. Like people are just thinking about crypto for the first time in months. And they're like, oh yeah, FTX is bad. Therefore crypto is bad.

• 11:11Ryan Sean Adams?

  Yeah, well, I have a more negative view of crypto, I would say, probably over the past month.

• 11:19Ryan Sean Adams?

  I mean, if you ask me this poll, I'm gonna like, but that doesn't mean I'm not long-term bullish. And by the way, this number is 8% now. It was 19% in March. So we got our own halving here, a little cut in half. This is pretty consistent, I think, with the conversation. It's also consistent with like pricing and everything else is what you'd start to expect as we hit towards the bottom. 8%. I'm still okay. 8% have a positive view. That's the silver lining. That's not too bad.

• 11:45David Hoffman?

  There's still a chance.

• 11:48Ryan Sean Adams?

  You guys know what crypto is at least. What's this chart we're looking at?

• 11:52David Hoffman?

  Yeah, this is the new record low of the GBTC discount. So buying one share of the Grayscale Bitcoin Trust is 47% discounted to how many Bitcoins is backing it. So in theory, if you could redeem those Bitcoins and you bought one Bitcoins worth of the GBTC trust now, you would get roughly 1.5 Bitcoins if you could redeem them, but you can't.

• 12:18Ryan Sean Adams?

  If Mr. Gensler will convert that to an ETF, then you should be able to redeem it. So this is some sort of regulatory, I don't know what you call that, tomfoolery.

• 12:30David Hoffman?

  If you have the longest-term time horizons, could be a good buy.

• 12:34Ryan Sean Adams?

  It could be, not financial advice. You know, we did an entire episode on GBTC. So if folks, you're wondering what GBTC is, your thesis, David, is that GBTC is what started this whole thing.

• 12:46David Hoffman?

  It is the linch, it is the thing that really started the bull market. So you can't really be too angry, but then also the reason why it all came crashing down.

• 12:55Ryan Sean Adams?

  Yeah, it's the first domino. Anyway, there's an episode. What's that episode titled? What did we end up calling that?

• 13:01David Hoffman?

  Thumbnail is grayscale and Genesis contagion, but we renamed it was to was 2021 just a gigantic Ponzi? Which for the answer is kind of a yes.

• 13:13Ryan Sean Adams?

  You're supposed to tease, not give them the answer. Okay. But yes, it was a Ponzi. Okay, what's this? What's this chart that we're looking at?

• 13:19David Hoffman?

  This is the coin price, the Coinbase.

• 13:23Ryan Sean Adams?

  Stock?

• 13:24David Hoffman?

  Token, Jesus, stock. Yes.

• 13:27Ryan Sean Adams?

  The traditional tokens.

• 13:29David Hoffman?

  Traditional tokens, yeah. Which Coinbase is coming in at a whopping $9 billion total market cap valuation.

• 13:38Ryan Sean Adams?

  Are you kidding me? Well, you mean whopping, you mean whopping like that's so low.

• 13:42David Hoffman?

  Bad, bad.

• 13:43Ryan Sean Adams?

  That's so low. 9 billion?

• 13:45David Hoffman?

  Extremely low.

• 13:46Ryan Sean Adams?

  Don't we have like alternative layer ones that are way higher than $9 billion right now?

• 13:50David Hoffman?

  So for for for context, Uniswap coming in at, what's the Uniswap price? I think like $6.25. That is a valuation of about $6 billion. So Coinbase is 50% more valued than Uniswap.

• 14:06Ryan Sean Adams?

  And UniToken doesn't even have any legal guarantees on the fees. Investor protections.

• 14:15David Hoffman?

  Yes, right.

• 14:16Ryan Sean Adams?

  And and Coin does.

• 14:20David Hoffman?

  Reminder that DeFi tokens are just tokens and we don't know what they are.

• 14:25Ryan Sean Adams?

  Well, there's hope, but you know, yeah. And by the way, there's there's news of more discussion about UniToken fees being flipped on. But also, that is really close. I mean, wouldn't it be crazy if Uniswap token price flipped from a market cap perspective coin? What does that mean? Does this mean coin is like silly low? Or like, what does this mean?

• 14:47David Hoffman?

  Coin is silly low. Coin is silly low. I think the coin, the equity of Coinbase is going to outperform 99% of tokens that you see on CoinGecko.

• 14:56Ryan Sean Adams?

  Let me put it this way. Jim Cramer would be telling you to sell your coin right now. Let me put it that way.

• 15:01David Hoffman?

  It's not too late.

• 15:03Ryan Sean Adams?

  Not too late to sell your coin. Speaking of all of these token prices, one of the things our analyst team at Bankless puts together is what we call the Bankless Token Bible. And this is kind of an analyst in a box service if you're a Bankless Premium Member. I'm actually showing some of it here, but this is usually like- Yeah, Brian's leaking the alpha. I shouldn't be leaking this alpha. In fact, I'll flip off the page. But this is like a master spreadsheet of our overweight, underweight kind of scores from our analyst team, and you can sort of see why. It's kind of a beta version of the product of what it will be in the next launch of our Bankless 2.0 website and everything- One of many 2.0 launches, yeah. Yeah, but it's something I wanted to just shout out because our team's doing a fantastic

• 15:47Ryan Sean Adams?

  job, and I don't think we talk about this very often, but like you can click in through Balancer and look, right now, this is all just like Google Doc pages. So you can see how it's like kind of raw. Underweight for Aptos? Why are we underweight for Aptos? Oh, I don't know. Let's go read about it and see what Ben the Analyst put into the doc. That's right. Ben, by the way, is a fantastic analyst on our team. He's where we get all of our DeFi alpha. Anyway, we have that all available to Bankless Premium Members. So it's just a shout out to upgrade so you can see what that looks like. And all of this, we'll be redesigning our new website. Speaking of token prices, David, let's talk about this.

• 16:27Ryan Sean Adams?

  This was a tweet I saw from Jacob Frannick, and this is a tweet about stablecoin market cap. All right, so about a year ago, February 27th, we had $166 billion worth of stablecoins on-chain issued. And this is all this kind of stablecoins, right? So centralized, decentralized. December 4th, $139 billion. So down, not by a dramatic amount, but down by about like, what, 25 billion? 27 billion. 27 billion. David did the math. I did the math there. It's interesting that BUSD is the stablecoin that's growing, the only stablecoin that's growing, not contracting. But what was more interesting to me about this is, do you remember Jim Bianco's thesis?

• 17:12Ryan Sean Adams?

  So Jim Bianco, repeat Bankless Podcast friend, and just fantastic views on traditional markets, but also like knows an incredible amount about like crypto and DeFi and like really digs in. He's an S tier individual. I love Jim Bianco. Go follow Jim Bianco on Twitter. Jim, if you're listening, man, we appreciate you. He had kind of a thesis. He actually asked our opinion on, and I was like, I don't know, Jim, that sounds right. You should write, you should write more about this. His thesis was DeFi, the liquidity for DeFi is through stablecoin. So if you want to measure kind of the economic bandwidth of DeFi,

• 17:51Ryan Sean Adams?

  right? But we'll put it another way. If you, if you want DeFi to grow, stablecoin market cap has to grow. And so we have about $140 billion of stablecoin economic bandwidth in DeFi. And if we want to 10x DeFi, we need to 10x the stablecoin value.

• 18:11David Hoffman?

  And specifically 10x DeFi prices, to be, to be specific.

• 18:15Ryan Sean Adams?

  DeFi prices.

• 18:16David Hoffman?

  He was saying DeFi token prices, like all things like liquidity.

• 18:20Ryan Sean Adams?

  All of it. Usage.

• 18:21David Hoffman?

  Is the underlying foundation, which makes sense, especially after we've done all of our Federal Reserve macro episodes.

• 18:26Ryan Sean Adams?

  Yes.

• 18:26David Hoffman?

  Everyone is like, yeah, the Fed, the markets are addicted to liquidity. When we're pulling liquidity out of the market, everything's selling. So it makes sense along those lines. Like if you give more stablecoin liquidity to DeFi, yields go up, token prices go up, things, everything else above it goes up.

• 18:44Ryan Sean Adams?

  So first of all, Jim or some other talented listener should do some analysis on this and run the data and do some kind of like, you know, models with, with historical data and see to what extent this is played out and what the correlation is. But also, I'm interested to look at this over time as sort of a leading indicator. If you want to see DeFi start to recover, we might need to see that stablecoin value on-chain tick up and hit from 140 billion, 200 billion, 300 billion. This might be some, a kind of a bullish sign to, to proceed a run-up. Anyway, good thesis there.

• 19:18David Hoffman?

  Yeah. Jim, if you're wondering what an S tier individual is, S is above A. S stands for super.

• 19:25Ryan Sean Adams?

  I'm glad you explained that for me.

• 19:29Ryan Sean Adams?

  The trend continues. People going bankless. David, what's this?

• 19:32David Hoffman?

  Yeah, Will Clemente says, tweets out, "Over the last 30 days, 200,000 Bitcoins." Reminder, out of 21 million, 200,000 Bitcoins worth $3.4 billion has been moved off exchanges. I don't think there's ever been a greater migration of Bitcoins, or probably value in general, off of centralized exchanges into self custody wallets. Well, even before Mt. Gox, right? Like, you can't even see Mt. Gox.

• 20:01Ryan Sean Adams?

  Yeah, all the red here. Well, this is, yeah, I think you're right. Is this?

• 20:05David Hoffman?

  Well, that's because it's measured in dollars.

• 20:07Ryan Sean Adams?

  Yeah, more in Bitcoin, but dollars. You're right. Wow. Biggest red over time we've ever seen. That's incredible. I mean, people are just like, "I don't trust exchanges. See you later. Self custody. Going bankless."

• 20:20David Hoffman?

  It's not how I wanted it to happen, but okay. So I saw these two tweets out of Token Terminal that I wanted to include in here. So this is developer activity overlaid by price for two ecosystems. First, we're looking at Cosmos. Developer activity looks like the start of a bull run. It starts to look like a very healthy line up.

• 20:39Ryan Sean Adams?

  That's the green line.

• 20:40David Hoffman?

  That's the green line.

• 20:40Ryan Sean Adams?

  It's a steady kind of upward trajectory for the last, over the last two years.

• 20:45David Hoffman?

  Yeah, exactly. Yeah. And then, I mean, we all know the price. The price is largely uncorrelated. Although the Cosmos token actually is kind of like up and to the right. It has this like middle chunk, which is definitely a manic bear or bull market. But now we're like at the trend that it was before the bull market in like 2019 to 2020.

• 21:04Ryan Sean Adams?

  Not manic, just fully fasted and full of energy.

• 21:11David Hoffman?

  Let me tell you, I was not fasting during the bull market. And then so we can flip over to, we can compare this to the Ethereum chart, which is the next tweet. Ethereum actually saw, for some reason, a drop off in developer activity in the last like couple of months or so. But you can get this overlay. Developer activity still over like the long term at absolute all time highs. And the ETH price is at a very much higher floor than it was in 2018. I just thought these were interesting.

• 21:38Ryan Sean Adams?

  I think they're interesting. Now, my big question in this, if you want to get to kind of the second question is, okay, but does your atom token map to developers in the Cosmos ecosystem? Because this is like, it's not the empire model that Ethereum is, where all value flows back to ETH, the token, right? Because of the mechanism design. For Cosmos, it's not necessarily true in any respect that all value leads back to the atom token. It could accrue in other app chains inside of Cosmos, right?

• 22:10David Hoffman?

  Which is, which is the bull case of the Cosmos thesis, is that the value does accrue elsewhere. And that's one of the big advantages and selling points of the Cosmos ecosystem.

• 22:20Ryan Sean Adams?

  Exactly. Which is why, of course, you can't like, you have to understand this space in order to, like, you can't take a Jim Cramer level, we're picking on Jim today. You can't take a Jim Cramer level, like, analysis, look at these two charts and be like, well, it means this, because this number's going up here, it means this number in this other ecosystem, you have to, you have to think about it more fully. David, what else we got coming up next, my friend?

• 22:42David Hoffman?

  Coming up next, Coinbase versus Apple. Does Apple even understand crypto? Do they even care? A lot of people seem to be going up against Apple. How many more until it takes for something to happen there? I don't know, but we're going to talk about it. And then we've got some data out of Genesis and Gemini earn to share. And SBF, of course, we got to tie the bow on the SBF conversation, because, like I said in the intro, I finally feel like we know what SBF is up to, or at least I'll give my takes. All this stuff and more, right after we talk to some of these fantastic sponsors to help you go bankless. Arbitrum One is pioneering the world of secure Ethereum scalability and is continuing to accelerate the Web3 landscape. Hundreds of projects have already deployed on Arbitrum One, producing flourishing DeFi and NFT ecosystems.

• 23:24David Hoffman?

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• 24:05David Hoffman?

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• 24:47David Hoffman?

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• 24:59Ryan Sean Adams?

  Coinbase and Apple in a head-to-head, Apple wanting to tax DeFi transactions and crypto transactions, and Coinbase not liking it. David, you have the tweet thread here. Let's look at Coinbase's position on things and give some of our takes. What's Coinbase saying?

• 25:17David Hoffman?

  Yeah, so they tweeted out of the Coinbase Wallet. So this is from the Coinbase Wallet, not Coinbase. Yeah, so important, small differentiator. You might have noticed, you can't send NFTs on the Coinbase iOS Wallet anymore. This is because Apple blocked our last app release until we disabled the feature. The feature of being able, the feature of being able to send NFTs, Apple was like, you guys have to block that before you update your app.

• 25:44Ryan Sean Adams?

  Okay, so Coinbase Wallet is like a non-custodial, self-custodial wallet. It's a bankless wallet. It's not their, not their full custodial solution. We're talking about the wallet, just like MetaMask, only on your, on your phone.

• 25:55David Hoffman?

  Mobile, yep.

• 25:56Ryan Sean Adams?

  And this basic functionality of sending an NFT from one place to another, just like sending an ERC 20 or ETH from one place to another, sending staple points, making a payment?

• 26:07David Hoffman?

  Yep.

• 26:07Ryan Sean Adams?

  They had to disable that because Apple blocked them?

• 26:11David Hoffman?

  Yes, because, because the Apple says, you guys have to block that feature before we allow you guys to push that app update.

• 26:18Ryan Sean Adams?

  Oh my god.

• 26:18David Hoffman?

  And so the tweet, the tweet thread continues and says, "Apple's claim is that the gas fee required to send NFTs need to be paid through their in-app purchase system so they can collect 30% of the gas fee."

• 26:35Ryan Sean Adams?

  What?

• 26:36David Hoffman?

  And of course, and so I think the next tweet just really summarizes this. "For anyone who understands how NFTs and blockchains work, this is clearly not possible. Apple's proprietary in-app purchase system does not support crypto, so we couldn't comply even if we tried." Okay, so Apple wants Coinbase Wallet to send them 30% of the gas fee that it takes to send an NFT. If Coinbase Wallet were to do this, they would have to pass that, that charge on to the customers. So they would have to take the gas fee and add on 30% so that they could pay Apple. But then, then there's a new number and then you would have to actually add on, take 30% of that new amount of that 30%, because like that's the new number that Apple would have to take. It's, it's, it doesn't make any sense.

• 27:20Ryan Sean Adams?

  It, it's shocking to me that Apple thinks it can do this. You're talking about, we're talking about a, an ETH transaction fee that is not, nothing to do with Coinbase. This is the base protocol fee inside of Ethereum and gas prices are set by the market, block-based demand versus block-based supply and whatever the, the demand is going for. So the gas fee can be different every single transaction. It could be a dollar, it could be $5, it could be $20. And you're saying that Apple wants 30% of that?

• 27:52David Hoffman?

  Yeah.

• 27:52Ryan Sean Adams?

  It's kind of not Coinbase's to give. Do you know what I mean?

• 27:56David Hoffman?

  Yeah.

• 27:57Ryan Sean Adams?

  They would like

• 27:58David Hoffman?

  They're trying to they're trying to tax Ethereum 30% and say, hey, if you want to use Ethereum, you got to pay us 30% of the fee.

• 28:04Ryan Sean Adams?

  So weird. All right, go on. What else did they say?

• 28:07David Hoffman?

  One of the important tweets that I liked was that the biggest impact of this policy change is on iPhone users that own NFTs. If you hold an NFT in a wallet on an iPhone, Apple just made it a lot harder to transfer that NFT to other wallets or gift it to friends or family. This one hit home for me, Ryan, because there was one time I we were we were at Bankless, gifted Cool Cats by William Peaster. He minted them, sent them all to us. And then then I passed my Cool Cat along to a friend using MetaMask mobile. I had it on my MetaMask wallet. I sent it to a friend who went down the crypto rabbit hole so hard, left her job, became a marketer for a crypto job because of I sent her a Cool Cat with a mobile wallet. So I have a personal story about like how I onboarded a

• 28:52David Hoffman?

  person by sending them a Cool Cat because of a mobile transfer, right? Spontaneous moment. Definitely wouldn't have done it if I had waited to get home to a ledger. We just so like this is just Apple just being like a baron and just like extortionary. This is like racketeering.

• 29:10Ryan Sean Adams?

  It's like it's like a feudal lord like like so. And this tweet above from Coinbase says, this is akin to Apple trying to take a cut of fees for every email that gets sent over open internet protocols. Yeah. Imagine that if there was a tax that iOS charged for internet protocols and for email.

• 29:29David Hoffman?

  Yeah. So Apple, I don't know. The debate here is, does Apple know what they're doing? Or do they not know what they're doing? Do they know the significance of this choice? Or are they just being like errant?

• 29:41Ryan Sean Adams?

  I don't know. I think it's interesting that we haven't heard anything yet from MetaMask about them blocking MetaMask, which of course you have the same functionality in MetaMask or other mobile wallets like Phantom. So maybe it's an oversight. At the same time, like I haven't heard of this being remedied. And it's like seven days later from when Coinbase is tweeting this. And just the wow, how do they not know this? Just like the idea that they could tax. Yeah, it's pretty egregious. And I think this is, this is not, crypto is not the only industry that's facing this. I mean, Tim Sweeney from Epic Games has talked about Apple's monopoly power.

• 30:20Ryan Sean Adams?

  And basically making it such that in-app purchases or like in-game purchases all have to throw through this land baron and this feudal lord. They get a cut of everything and they're adding no value in the process. This is just rent-seeking behavior, isn't it? And you can only do rent-seeking behavior if you have a monopoly. And in this case, I mean, I have an iPhone, right?

• 30:42David Hoffman?

  I have 17 Apple products.

• 30:45Ryan Sean Adams?

  Okay, so they kind of like, they have that power over consumers. And I don't, I don't know how you get this to stop. Obviously, the free market approaches competitors and you disrupt Apple and you create kind of a different mobile experience that's more open. There's also the regulatory approach where some nation state says, no, we have a bigger stick and we'll whack you.

• 31:07David Hoffman?

  Our monopoly is bigger than yours. We have.

• 31:09Ryan Sean Adams?

  We have, we have a military, so that's the other way things get done. But I don't know where this ends. It's just pretty egregious, isn't it?

• 31:18David Hoffman?

  Yeah, that's the conversation that I've seen outside of crypto Twitter, outside of crypto media is that like, Apple wants to take 30% of everything. I think I saw that in like a TechCrunch article, that headline. And at some point, it just gets down to like antitrust. At some point, we're just gonna take, there's enough of a cohort of people that are offended by Apple trying to rake them of 30% that people are just.

• 31:39Ryan Sean Adams?

  Don't they make enough money on their, like, the hardware that they sell? They're great products? Like, that's cool.

• 31:45David Hoffman?

  I don't think you can ask a company to try and make less money. I don't think.

• 31:48Ryan Sean Adams?

  Make less money?

• 31:49David Hoffman?

  Yeah.

• 31:50Ryan Sean Adams?

  Apple, you should make less money. We'll see what Tim Cook says. Tim Cook on Bankless. Let's go. All right, what's this? Genesis?

• 31:58David Hoffman?

  Genesis, okay. How much did Gemini customers have in Gemini earn that went to Genesis? The answer to that is $900 million, which is kind of a doozy.

• 32:11Ryan Sean Adams?

  Just shy of a billion dollars.

• 32:12David Hoffman?

  That's a little bit of a doozy.

• 32:13Ryan Sean Adams?

  In Gemini, this is just in Gemini earn. So this is not all of Genesis obligations. We're now focused because there is money stuck for retail in Gemini earn. And it's to the tune of 900 million that Genesis owes Gemini.

• 32:29David Hoffman?

  Yep.

• 32:30Ryan Sean Adams?

  What does this mean, David? Are we gonna get that back?

• 32:33David Hoffman?

  I don't know. I don't know. Like, people were talking about like the Winkleville just making Gemini earn customers whole. And I was like, oh, in theory, it's possible.

• 32:43Ryan Sean Adams?

  They're billionaires.

• 32:44David Hoffman?

  They're billionaires.

• 32:45Ryan Sean Adams?

  Big check.

• 32:46David Hoffman?

  That's a big check. That's a really big check. I don't think they'd do that.

• 32:51Ryan Sean Adams?

  Well, what is the correspondence of the feedback from Genesis and Gemini? Have they talked about this? This is a headline that says Genesis says plans to resolve lending units woes could take "weeks", in quotes. So I mean, Genesis is still trying.

• 33:07David Hoffman?

  I'm gonna take the over on that one.

• 33:09Ryan Sean Adams?

  Over, yeah. It could be like, God bless you, Joe Lubin, weeks, where it's like, weeks, not months, kind of thing.

• 33:16David Hoffman?

  Yeah.

• 33:18Ryan Sean Adams?

  Yeah. I don't know, man. I don't know. So that's, this is still hanging over our heads.

• 33:21David Hoffman?

  There wasn't too much data beyond what was those two articles. 900 million, may take weeks to resolve. It's gonna take months.

• 33:26Ryan Sean Adams?

  We'll keep you guys updated on this. David, you said you had some final insights into SBF. Like, you feel like that is starting to wind down.

• 33:35David Hoffman?

  Yep.

• 33:36Ryan Sean Adams?

  And you said Nic Carter was right. What is he right about? Is this a whole tweet thread, or should I go to a specific thing here?

• 33:41David Hoffman?

  So the top tweet is a tweet that we shared last week on the weekly rollup. When we collectively, as SBF was going through his public media tour, talking to everyone, making them look like fools, by the way, people were giving their takes.

• 33:58Ryan Sean Adams?

  As to why? Because it's very bizarre behavior. It seemed non-rational.

• 34:01David Hoffman?

  Exactly. So one of the takes that we shared was Sam isn't behaving like a renegade who is ignoring the advice of his lawyers. He's behaving like a world-class, like he has a world-class crisis management firm and legal team constructing a very specific and deliberate public narrative. That's one of the takes that we shared from Nic Carter.

• 34:16Ryan Sean Adams?

  4D chess. Sam is doing this all intentionally. He knows exactly what he's doing.

• 34:20David Hoffman?

  Yep. Yep. God, now, whenever I say yep, I'm like, that's what Sam says when...

• 34:27Ryan Sean Adams?

  Long pause.

• 34:28David Hoffman?

  Anyways, SBF, a tweet went out this week, SBF of FTX has hired Mike Cohen, Mark Cohen, as his attorney. Cohen recently defended Galen Maxwell in her sex trafficking trial and defended El Chapo prior to that. And Carter says, takes a victory lap and he says, like, as I said, yes, he's got a rock star legal defense.

• 34:51Ryan Sean Adams?

  Wow. All right. So when I first saw this, first of all, I thought it was Michael Cohen. It's not Michael Cohen. All right. This is a different Cohen. This is a guy named Mark Cohen.

• 34:58David Hoffman?

  Yeah.

• 34:58Ryan Sean Adams?

  And he is the lawyer who defended Maxwell.

• 35:02David Hoffman?

  Yeah.

• 35:03Ryan Sean Adams?

  For in sex trafficking case and El Chapo.

• 35:05David Hoffman?

  Epstein thing. Yeah.

• 35:07Ryan Sean Adams?

  Epstein thing and El Chapo, the drug lord.

• 35:09David Hoffman?

  Yeah. I don't know if it gets higher than that.

• 35:11Ryan Sean Adams?

  No, this is who you hire when you are like a hardened criminal, but like at least El Chapo. I don't know about Maxwell and you're super wealthy.

• 35:21David Hoffman?

  God, can you imagine being like if being a client of a lawyer and your other fellow clients are Galen Maxwell and El Chapo? Like you're not in a good spot.

• 35:32Ryan Sean Adams?

  No. Uh, yeah. Well, you know, how many lawyers would apply for this type of a job? I don't, you know, I don't know.

• 35:39David Hoffman?

  The, the other joke about this, when this was going out was that like Sam Bankman Fried said that he only has a hundred thousand dollars left in his bank account. So who's paying for this?

• 35:47Ryan Sean Adams?

  Wait, he said that?

• 35:49David Hoffman?

  Yeah. Yeah. Yeah. He said that a couple of times. People, people asked him like, all right. So like, how much money you have left, Sam? And he's like, I've got one credit card that works. And I think I've got like a hundred thousand dollars in my bank account.

• 35:58Ryan Sean Adams?

  No way.

• 35:59David Hoffman?

  So, so who's paying this guy?

• 36:01Ryan Sean Adams?

  My God. So he has like no crypto? He has no crypto assets?

• 36:04David Hoffman?

  Allegedly. I don't believe a single damn word out of that man's mouth.

• 36:08Ryan Sean Adams?

  Yeah. Well, yeah. Um, go on. What else do you think about this story? What's happening here?

• 36:13David Hoffman?

  Yeah. So there was an interaction between SBF and Maxine Waters, which drew a lot of attention, which is the next tweet, Ryan, if you want to hop over to that one.

• 36:21Ryan Sean Adams?

  And refresh us, who is Maxine Waters? She is on the US House Committee of Financial Services, right?

• 36:27David Hoffman?

  Yes.

• 36:27Ryan Sean Adams?

  So she's in the House.

• 36:28David Hoffman?

  Previously seen before FTX's collapse, blowing a kiss to SBF in as he walked out of his hearing that he had way long ago.

• 36:38Ryan Sean Adams?

  Like in, in real life kiss?

• 36:40David Hoffman?

  Yes.

• 36:41Ryan Sean Adams?

  Out of a hearing in Congress?

• 36:43David Hoffman?

  Yes, blew him a kiss, because he donated billions of dollars to her and the Democrats.

• 36:49Ryan Sean Adams?

  But that's on like TV, that's on like

• 36:51David Hoffman?

  That's on TV!

• 36:52Ryan Sean Adams?

  Something, and you're blowing a kiss?

• 36:54David Hoffman?

  Yes, to SBF.

• 36:55Ryan Sean Adams?

  Seems like strange behavior.

• 36:56David Hoffman?

  Yes, anyways, Maxine Waters and co-tweeted with the Finance Senate Committee Democrat Twitter account, she goes, "SBF, we appreciate that you've been candid in your discussions about what happened at FTX. Your willingness to talk to the public will help the company's customers, investors, and others. To that end, we would welcome your participation in our hearing on the 13th." What is this tone, dude?

• 37:23Ryan Sean Adams?

  This is really soft.

• 37:24David Hoffman?

  What?

• 37:24Ryan Sean Adams?

  This is on December 2nd, right? So, "We appreciate that you've been candid in your discussions about what happened at FTX." He has not been candid.

• 37:33David Hoffman?

  No, he's been in a narrative, Maxine!

• 37:36Ryan Sean Adams?

  Yeah, he has been the farthest thing from, what's the opposite of candid? He has been opaque, he has been

• 37:41David Hoffman?

  Yes.

• 37:42Ryan Sean Adams?

  lying

• 37:42David Hoffman?

  Yes.

• 37:43Ryan Sean Adams?

  about what's happened at FTX. So, this is the soft glove treatment? I don't know what this is.

• 37:51David Hoffman?

  So she later tweeted out a harder sounding tweet.

• 37:55Ryan Sean Adams?

  Because that didn't play over well?

• 37:57David Hoffman?

  Yes, because that did not play over well, yes, certainly. So here's her replacement tweet that came out the next day or maybe 48 hours later.

• 38:07Ryan Sean Adams?

  Yeah, a few days later.

• 38:08David Hoffman?

  Yeah, "Based on your role as CEO and your media interviews over the past few weeks, it's clear to us that the information you have thus far is sufficient for testimony. As you know, the collapse of FTX has harmed over 1 million people. Your testimony would not only be meaningful to members of Congress, but also critical to the American people. It's imperative that you attend our hearing on the 13th, and we are willing to schedule continued hearings if There's more information to be shared. Why is this a request? Why are we asking SBF nicely? Why hasn't the goddamn Navy gone over to the Bahamas and taken SBF by the collar and dragged him to a courthouse? How come we haven't done this yet?

• 38:50Ryan Sean Adams?

  Why are we sending out like the wedding invitation? Shouldn't we be sending out subpoenas?

• 38:54David Hoffman?

  Yes.

• 38:54Ryan Sean Adams?

  Isn't that within Maxine Waters?

• 38:56David Hoffman?

  Why haven't we subpoenaed him?

• 38:59Ryan Sean Adams?

  Okay.

• 39:00David Hoffman?

  So Kevin O'Wakki put that into a meme. If you want to scroll down, it's like right there. Yeah.

• 39:04Ryan Sean Adams?

  Okay, let me scroll down.

• 39:06David Hoffman?

  There it is. And so this is the classic bell curve meme, right? So you have Maxine Waters in the middle, who's like being sad and requesting, "It's imperative that you attend our hearing on the 13th." And then the, the, the left side and the right side of the curve are like, "Just subpoena him. Make him show up."

• 39:26Ryan Sean Adams?

  Yeah, you could do that.

• 39:27David Hoffman?

  Use the guns that we have.

• 39:32Ryan Sean Adams?

  FDX bankruptcy managers hire a forensic, forensic investigators, according to the Wall Street Journal. So we're getting to that stage in the process. We're trying to figure out where all the money went.

• 39:42David Hoffman?

  Right, yes. The forensic investigators are Alex Partners, have been hired, this consultancy firm, to trace billions of dollars that have gone missing. And their previous job, a previous job that they had, was helping recover the stolen funds in the Bernie Madoff case. Again, not, the Sam Bankman-Fried's cohort is very strong.

• 40:02Ryan Sean Adams?

  Look at this picture of Sam. I love that they use this. It's very strange. Oh, this was crazy. Okay, so apparently, do you know how FDX did all of these deals with like Tom Brady and other celebrities?

• 40:14David Hoffman?

  Yep.

• 40:15Ryan Sean Adams?

  Influencers?

• 40:16David Hoffman?

  Every celebrity under the sun, yeah.

• 40:17Ryan Sean Adams?

  They tried to give Taylor Swift a hundred million dollar sponsorship deal.

• 40:22David Hoffman?

  What does it mean to sponsor Taylor Swift?

• 40:24Ryan Sean Adams?

  She said no. I think it was like sponsoring like her stadium, stadium tour for the next album, kind of thing. I don't know what else it would mean. Spokesperson, I'm sure. A hundred million dollars, David, but she said no.

• 40:37David Hoffman?

  A part of like the psychological like unpacking of SBF has got to be something along the lines of like kleptomania. He can't not give away customer funds. He was spraying and praying this stuff from the hip, like. Uh, he would like, he came in and bought that bank at like three times its values. Like, I don't care what the value is.

• 40:55Ryan Sean Adams?

  All of these vanity things.

• 40:56David Hoffman?

  I wa- I want to spend customers' funds. It is a fun activity for me. And it's like, yeah, you know what's fun? Taking Taylor Swift's fans' money in as customer deposits on FTX and then paying Taylor Swift.

• 41:09Ryan Sean Adams?

  Wait, wait, wait. You think a bunch of Taylor Swift fans are also crypto people?

• 41:13David Hoffman?

  I mean, like, not zero.

• 41:16Ryan Sean Adams?

  Okay.

• 41:16David Hoffman?

  So like, this is just a gigantic game of like, how fucking corrupts are, can he be? I was just like, I'll, I'll take the fans' money and then I'll sponsor Taylor Swift and it'll be the biggest grift of all time.

• 41:27Ryan Sean Adams?

  Yeah, it, it, well, it really may have been. I mean, this is top three grifts, top five grifts of all time, I think. And I remember back when we had, uh, Brian Armstrong on the podcast about a year ago. And we're kind of like, so, uh, Brian, um, Sam's doing all of these things. Like, he's got this sports arena, he's got Tom Brady, he's got all these celebrity endorsements. And like, what are you doing on the marketing side? And, uh, Brian was like, uh, I don't really like, we're not a marketing-focused company. We just build. And my God, retrospectively, that is so refreshing. Like, good job for focusing on what you should be doing.

• 42:01David Hoffman?

  Not spending customers' funds. Nice job.

• 42:04Ryan Sean Adams?

  Absolutely ludicrous. Oh, did you see my tweet, though, about this?

• 42:08David Hoffman?

  This is one of these tweets where like, I just like, I just sit and pause and be like, who the, who the hell is this Ryan Sean Adams man? So Ryan Sean Adams tweets, uh, cause tweeting out the headline, uh, that Taylor Swift declined, uh, the $100 million, uh, immediately. Uh, Ryan Sean Adams tweets, she knew Sam was trouble when he walked in.

• 42:32David Hoffman?

  Okay, so, so my mind is like, it's a very underappreciated tweet. Uh, my mind goes to like, all right, he's an AI, so he just like, did Google searching and came up with this. So that would, that's just normal. Or he's a Taylor Swift fan and like, have this one ready to go. Or he's a, he's a dad of a, of a teenage daughter.

• 42:52Ryan Sean Adams?

  You know what?

• 42:52David Hoffman?

  Which I think all three of those things are true.

• 42:55Ryan Sean Adams?

  It could be all three things at once. We just don't know. And I think you have to be comfortable, David, if we're going to see this podcast every week is living in that ambiguity.

• 43:03David Hoffman?

  Oh, God.

• 43:04Ryan Sean Adams?

  You just don't really know.

• 43:05David Hoffman?

  All right. Well, somebody who accepted SBF's offer, Kevin O'Leary, paid $15 million to be an FTX spokesperson.

• 43:14Ryan Sean Adams?

  He was paid, right?

• 43:15David Hoffman?

  Was paid.

• 43:16Ryan Sean Adams?

  He got 15 million.

• 43:16David Hoffman?

  Yes, he was paid 15 million dollars. 15 million dollars of customer deposits went into Kevin O'Leary's pockets to be a paid FTX spokesperson. What is this? What is a paid spokesperson? What is that role?

• 43:30Ryan Sean Adams?

  Um.

• 43:32David Hoffman?

  Like, it's like an evangelist role.

• 43:34Ryan Sean Adams?

  Yeah.

• 43:35David Hoffman?

  If you're publicly known as being paid.

• 43:38Ryan Sean Adams?

  Isn't that what you do?

• 43:39David Hoffman?

  Then you're just a paid chill.

• 43:41Ryan Sean Adams?

  David, for ETH, except you're not paid?

• 43:43David Hoffman?

  Yeah. Well, I mean, I'm paid in the sense I own ETH.

• 43:46Ryan Sean Adams?

  Can you just believe it?

• 43:47David Hoffman?

  But that's a choice that I made.

• 43:48Ryan Sean Adams?

  No, I don't know what this is.

• 43:49David Hoffman?

  I also spent money to do that.

• 43:50Ryan Sean Adams?

  Can I just say, like, high level, like, I'm disappointed. Like, I'm not, but Kevin here.

• 43:56David Hoffman?

  I'm mainly disappointed that Kevin is doubling down multiple times on how FTX is in SBF and he believes SBF and all that stuff.

• 44:03Ryan Sean Adams?

  Did you actually watch this clip? Maybe you should.

• 44:05David Hoffman?

  Yes, I did.

• 44:06Ryan Sean Adams?

  Let's play this clip. Let's play this clip.

• 44:07Speaker 02

  That was FTX money that you got. I don't, I don't think you should be singing the blues right now at all. Oh, yes, I'm singing the blues. Why? Because your 15 million didn't pay out that you, that's a lot of money. To be a paid spokesperson. It's a lot of money. You didn't have to do much for that. That's, that's found money. That's a different decision. That's a different discussion. I, you know, you can make that decision on your own, but.

• 44:28Ryan Sean Adams?

  Yeah. So here, this is Kevin having really no answer to the interviewer who's asking, like, you got 15 million dollars. Like, why are you still supporting FTX?

• 44:37David Hoffman?

  Give it back.

• 44:37Ryan Sean Adams?

  Give it back, like, distance yourself. I made a mistake.

• 44:40David Hoffman?

  Yeah.

• 44:41Ryan Sean Adams?

  The doubling down is, is kind of strange at this point.

• 44:44David Hoffman?

  Like, dude, your contract's over, man.

• 44:46Ryan Sean Adams?

  Yeah, you don't have to do this. And it's not, like, the ship has already sunk and you're just like, I don't know, you're still clinging on to it. And apparently, out of all of this, David, someone is going to begin investigating the SEC.

• 44:59David Hoffman?

  Thank you.

• 45:00Ryan Sean Adams?

  And how they managed to miss FTX. What is this tweet that we're reading?

• 45:03David Hoffman?

  This is from Alexander Grieve. New this morning, Representative Richie Torres, the Democrat out of New York, calls on the Government Accountability Office to investigate the SEC's failure to protect the investing public from the egregious mismanagement and malfeasance of FTX. I think basically saying, hey, stop going after the long tail of security frauds and unregistered securities. Don't go after the long tail. Go after the big one. Like, do the big one.

• 45:32Ryan Sean Adams?

  You gave us Kim, we should have gotten Sam.

• 45:34David Hoffman?

  Yeah.

• 45:36Ryan Sean Adams?

  Basically.

• 45:37David Hoffman?

  Yeah. So I'm in full support of investigating the SEC.

• 45:42Ryan Sean Adams?

  What else we got coming up, David? It's a hot episode still. A few big topics to cover. What's coming up?

• 45:47David Hoffman?

  Yeah, getting into more crypto stuff. The withdrawals. Hard Fork is coming?

• 45:51Ryan Sean Adams?

  Huh.

• 45:52David Hoffman?

  Question mark. Big question mark. A brand new Spiffy Ledger hardware wallet, which is more screen than it is not screen. And Ryan and David talk ChatGPT. If you are, were not on Twitter or in hearing about ChatGPT, it has caught the world by storm, especially crypto Twitter. So we're going to talk a little bit about AI chat. And we're going to have one AI talk to another while I observe. All of that and more after we talk to some of these fantastic sponsors to help you go bankless. The reality today is that five corporations control the entire world of social media. They own our names. They restrict our content. They monitor our every move. And their time is up, thanks to our sponsor, DSO. DSO is a Layer One blockchain, built from the ground

• 46:32David Hoffman?

  up to decentralize and scale social networks. With DSO, you can own your own identity, content, and social graph, and take it with you across hundreds of applications already built on the censorship-resistant DSO blockchain. DSO's storage advantages make it finally possible to build infinite state applications that can efficiently store and index large amounts of content and data fully on-chain. DSO also offers multiple crypto-native monetization primitives for developers and creators, including social NFTs, social DAOs, social tokens, and social tipping. So in order to experience the social layer of Web 3, go to deso.com and claim your username. That's D E S O dot com. If you've been listening to Bankless, you know that we're fans of the modular blockchain thesis.

• 47:16David Hoffman?

  The idea that blockchains will separate execution from data availability and consensus, allowing all three to become the best versions of themselves. And Fuel has built the fastest modular execution layer in the industry. By supporting parallel transaction execution, Fuel unlocks significantly faster throughput for the Web3 world. Fuel also goes beyond the limitations of the EVM with its own Fuel VM, which is more efficient and optimized, opening up the design space for developers. And lastly, Fuel brings a powerful developer experience with its own domain-specific language, Sway, and a supportive tool chain called Fork. With Fuel, you can have the benefits of smart contract languages like Solidity while adopting the improvements made by the Rust tooling ecosystem, letting the Fuel development environment go beyond the limitations of the EVM.

• 48:00David Hoffman?

  If you want to learn more, there's a link in the show notes to see how you can get involved with a Fuel network. If you have your Ether staked, you might be able to get that Ether back as soon as, perhaps, March. This is always just speculation and rumor, but lately, the words out of the core devs' mouth have had "withdrawal," "hard fork," and "March" in the same sentence. This is how this news-

• 48:24Ryan Sean Adams?

  March 2023, right, David?

• 48:26David Hoffman?

  2023, yes, correct. Yeah, and this is how this news works, right? And so, like, there is no official date, there's no official time until the core devs come to consensus about the time. But right now, there have been talks where the words "withdrawal" and "hard fork" and "March" have been in the same sentence. And so, now, CoinDesk is now reporting this. Ethereum developers target March 2023 for release of staked Ether. Whether or not EIP4844 is also included in this hard fork is TBD. That is more of a reach. Withdrawals are currently being prioritized more than EIP4844. EIP4844 is proto-dank sharding, but-

• 49:05Ryan Sean Adams?

  Which brings more scalability, right? Basically, there are a lot of other features in these next coming hard forks, but the two big ones that everyone's talking about are being able to withdraw the staked Ether and this thing called proto-dank sharding, which is EIP4844, which we've done episodes about, which makes rollups super cheap and super scalable. So you've got withdrawals and kind of more on the scalability side. And it's the rumors are it's looking like EIP4844, the proto-dank sharding one, will probably not make the first hard fork.

• 49:36David Hoffman?

  Yes, it'll be a, it'll be a, yeah. That's probably where I put my money.

• 49:40Ryan Sean Adams?

  Maybe this says we'll follow a subsequent hard fork in the fall. And the fall is like in quotes, who knows? We can't predict two hard forks in advance, but that's good news. We get the hard fork with, but staking withdrawals. You're going to withdraw anything or you're going to deposit?

• 49:55David Hoffman?

  I, so that's gonna, definitely, I think there will be a net outflow because of the, with the, of the locked ether. But also that will also be counteracted by the fact that there is a two-way road finally, where like there's no lockup periods will also incur some sort of demand to stake ether as well. Cause the risk is.

• 50:14Ryan Sean Adams?

  I think, I, I think some people will be like, okay, now I can withdraw. So now I'm willing to deposit because now I have the ability to withdraw.

• 50:20David Hoffman?

  And I don't have to lock it. Just think about like the product of each staking is now complete. Therefore more, it will be used more.

• 50:26Ryan Sean Adams?

  Yep.

• 50:27David Hoffman?

  But I still think in the short term, there will be a net outflow because I mean, the withdrawal, staking with deposits have been locked for forever.

• 50:34Ryan Sean Adams?

  Stake it till you make it, David. That's my plan.

• 50:38Ryan Sean Adams?

  Long tail contingencies, like there's some other dominos maybe following from the FTX stuff. A few maybe baby dominos, we might call them hitting DeFi. What's this one from Maple?

• 50:47David Hoffman?

  Yeah. So Maple Finance is an on-chain, under collateralized institutional lending DAO product. And so it is actually kind of an intersection between the very rock solid and hardened DeFi apps that we all know and love and the more risky black box centralized borrowers and lenders. It's kind of in the middle there. It's on-chain, kind of like DeFi stuff, so it's fully transparent. But it is under collateralized, which means that there needs to be underwriting and vetting and institutional only borrowers and lenders. So that's what Maple is. And so orthogonal trading was both an underwriter and a borrower out of Maple Finance. And orthogonal trading apparently was way less solvent than they had made it out to be.

• 51:33David Hoffman?

  They were due to pay back a $10 million USDC loan from one of the Maple Finance pools. There's not one central pool with Maple Finance. There's many smaller ones. They were going to, they were due to pay back $10 million on December 4th. They did not make that payment. Therefore they have, all have all of their credit closed. But then they've realized that orthogonal actually doesn't have any money, apparently.

• 51:57David Hoffman?

  And had a net set of $31 million of liabilities out of Maple Finance. That is $31 million of a USDC and then an additional $5 million of wrapped Ether. And so that left a decent hole in Maple Finance in this one specific pool. So the way that they contain the, one of the ways that this is different, the story is different, is that there's actually very little contagion inside of Maple because they have very distinct pools.

• 52:26Ryan Sean Adams?

  Isolated pools.

• 52:27David Hoffman?

  Isolated pools for this exact purpose. So there was no, very little to no contagion there. So, but if you had underwritten one of these pools, this pool M11, which is how they denote these things, got an 80% haircut. It lost 80% of the value. The total value of all loans into Maple was about 30%. So Maple was, lost 30% of its total asset under management because of this one insolvency.

• 52:55Ryan Sean Adams?

  Wow.

• 52:55David Hoffman?

  So like, these are smaller numbers than some of the numbers that we've heard about, but.

• 52:59Ryan Sean Adams?

  But is Maple going to be fine? Are they going to recover from this? Is this part of, can the ship like stay afloat?

• 53:05David Hoffman?

  I don't know. I don't know the answer to that. I think we need this to have, play out a little bit more. But that's actually not where the story ends because Nexus Mutual also had some money inside of Maple Finance. So Nexus Mutual, which is a insurance, smart contract and insurance platform on Ethereum, lost $3 million due to this exposure. So they were in one of those same pools. They were in the Ether pool. So they got hit.

• 53:31Ryan Sean Adams?

  Why were they in it? Was this just part of treasury?

• 53:34David Hoffman?

  Yes, treasury management. Yep.

• 53:36Ryan Sean Adams?

  Wow. So this wasn't even part of the Nexus Protocol. It wasn't like a hack that went bad and that they had to kind of provide insurance for it. It was like, we have some treasury funds and we're going to put it here in order to get higher yield and the cost to them was $5 million, $3 million for that.

• 53:53David Hoffman?

  $3 million. 1.6% of all of Nexus Mutual's assets.

• 53:57Ryan Sean Adams?

  Wow, treasury management, very important to get these risks into the market, huh?

• 54:03David Hoffman?

  I would say just like this, the hybrid position of between DeFi and C-Fi it kind of does map out to how much damage there was, not complete dead, but pretty badly harmed. I kind of felt.

• 54:17Ryan Sean Adams?

  Chasing yield, chasing yield can be a pretty bad game to play.

• 54:22David Hoffman?

  Yield, yield has just got a bad name these days.

• 54:24Ryan Sean Adams?

  Like, because if you even get like 10% yield, right? I mean, like, are the chances greater than 10%? That the protocol you're in could like die? Or like, how about once every 10 years, the protocol in your? If it's greater than that, then like you're actually not making a risk-adjusted return.

• 54:47David Hoffman?

  Dude, Vitalik gave us that take on one of our podcast episodes with him like over a year ago.

• 54:52Ryan Sean Adams?

  Vitalik was here.

• 54:55David Hoffman?

  He was saying that the DeFi yield risks were underappreciated back in like 2020.

• 55:02Ryan Sean Adams?

  What's he saying now, though? We need to know this.

• 55:04David Hoffman?

  It didn't matter when prices go up, it only matters when the risks only show up when prices go down.

• 55:08Ryan Sean Adams?

  Totally, totally. What's Gitcoin doing, David? This is kind of exciting.

• 55:11David Hoffman?

  Gitcoin and UNICEF. Okay, so Gitcoin has been one of the big pillars of the Ethereum ecosystem for a very long time, and it's always been pretty insular. It's Ethereum funding other parts of Ethereum. This is a story of quadratic funding and Gitcoin breaking out to the outside through UNICEF. So Gitcoin is launching its first ever quadratic funding round on its new grants protocol in collaboration with UNICEF's Office of Innovation between December 9th and December 16th. So the same Gitcoin system that you know, but now for UNICEF.

• 55:42Ryan Sean Adams?

  That's really cool.

• 55:43David Hoffman?

  Select a group of 10 impact-focused innovative projects using blockchain or AI technologies for social good from around the world, including Nepal, Kenya, Argentina, Brazil, and the Philippines. This round will be the first of five test rounds to run on Gitcoin's new grants protocol as a part of Gitcoin's alpha test season. This launch signals the beginning of Gitcoin's transition to a decentralized protocol that will allow any community to coordinate its own grants funding round. Very cool. Very cool. We like this.

• 56:09Ryan Sean Adams?

  I love that. Yeah, if we could start showing how crypto can start to fund public goods as nation states might.

• 56:14David Hoffman?

  Not our own public goods, but other people's public goods.

• 56:17Ryan Sean Adams?

  As nonprofits might, as the real world might, it will increase the legitimacy and coordinating power of crypto. I know that's what Kevin Iwaki has been trying to do the whole time.

• 56:27David Hoffman?

  If you donate in this grant round, there are PO apps for you to collect. So for the PO app, Maxi's out there, how about it?

• 56:36Ryan Sean Adams?

  Aztec and Ethereum Privacy, they're making some strides here. David, what's the stat we're looking at?

• 56:41David Hoffman?

  There is now 50,000 shielded ETH inside of Aztec Connect. So Aztec Connect is just a fundamentally better product than Tornado Cash. The cryptography is just more solid. And they've got 50,000 ETH inside of Aztec Connect. So $60 million of Ether is now being sent and earning yield privately. And that's actually not the only stat, but that's kind of the first big one. They got some other stuff down there as well. I think it was something like 500,000 transactions on the network and then 5,000 blocks on the Aztec Layer 2.

• 57:15Ryan Sean Adams?

  This is a Layer 2 that's completely private. And that's why you say it's better, because it's better than Tornado Cash is because it's lower gas fees, it's not unmained net, and it has Layer 2 level settlement guarantees. And it's also very scalable. One other benefit, too, is of course, you don't have to go to jail if you're a US citizen and you use this thing. That's kind of nice, isn't it?

• 57:40David Hoffman?

  I would say, actually, you're underselling it a little bit, because the thing about

• 57:43Ryan Sean Adams?

  Wait, I do have to go to jail?

• 57:46David Hoffman?

  No, you don't have to go to jail. Why is Aztec better than Tornado Cash? Tornado Cash is privacy via the crowd. So it pools all of your money together and then you just co-mingle it up. Actually, it's technically not true, but it appears to be like that.

• 58:01Ryan Sean Adams?

  You blend in, like privacy by numbers kind of thing.

• 58:02David Hoffman?

  Yes, and time. And so you need to hang out in Tornado Cash for a long amount of time to achieve privacy. The more money that you have to become private, the longer you need to hang out. Aztec is atomic privacy. One transaction. of privacy. You can go into the pool and out of the pool instantaneously. And you have the full strength and power of Aztec privacy.

• 58:24Ryan Sean Adams?

  So tornado needs to have big crowds in order to protect your privacy. And for some assets in some pools, those crowds are too small to really provide you an identity shield.

• 58:36David Hoffman?

  Especially when they make it illegal for you to be in the pool. Yeah.

• 58:40Ryan Sean Adams?

  Yeah. Yeah. As we know. Okay, that's cool. I think this is very bullish.

• 58:45David Hoffman?

  Disclaimer, Ryan and I are investors in Aztec.

• 58:48Ryan Sean Adams?

  Also disclaimer, we love privacy. On chain privacy.

• 58:51David Hoffman?

  Big disclaimer, we love privacy.

• 58:55David Hoffman?

  But we don't love privacy so much that you can't see all of our disclosures in our disclosures tab. You can see literally everything that Ryan and I have invested in because while we do love privacy, we also love ethics.

• 59:05Ryan Sean Adams?

  There you go.

• 59:05David Hoffman?

  How'd you like that one, Ryan?

• 59:06Ryan Sean Adams?

  I love that. Good shill of the disclaimers page. Always in the show notes, guys. You can catch that. Speaking of good shills, Toys R Us is doing digital collectibles. All the Toys R Us are closed now. Like, there's no actual storefront.

• 59:20David Hoffman?

  I thought Toys R Us was bankrupt.

• 59:23Ryan Sean Adams?

  I don't know anymore. I don't know. But they are still a brand. It's still in my childhood, like, you know, I guess, dream. So now they're doing, now they're doing digital collectibles, David. Is there anything more to this story? Or, uh, my kiddos love this, is a tweet from Anatoly.

• 59:40David Hoffman?

  Yeah, Anatoly, because this is on Magic Eden. So this is on Solana. So Toys R Us launching NFT collectible, digital collect- oh, they didn't even say NFTs. Oh, that's great. Nice drop. Digital collectibles, Toys R Us launching on Magic Eden on Solana, December 9th. That's today. That's Friday. Okay, moving on.

• 1:00:00Ryan Sean Adams?

  Move fast. Reddit collectible, their avatar minting hits an all time high. And that was last time I brought this up. It was an all time high as well. So they just keep hitting all time highs during this bear market. This is great.

• 1:00:15David Hoffman?

  And it's a nice story out of Reddit, which has always had a hard time monetizing. Reddit ads has been terribly performing. Like, Facebook ads really actually aren't that great performers. Twitter ads even worse. Instagram ads kind of acceptable. Reddit ads, the bottom of the barrel. So the fact that they found this monetization path of selling digital collectibles is great. It's a great story.

• 1:00:37Ryan Sean Adams?

  Yeah, it's a collectible avatar importantly, certainly not an NFT. Do not be confused.

• 1:00:42David Hoffman?

  Yes.

• 1:00:43Ryan Sean Adams?

  It's a joke. It's also an NFT. It's on Polygon, I believe. That's where this is on.

• 1:00:47David Hoffman?

  Yes.

• 1:00:48Ryan Sean Adams?

  They're also doing some stuff with...

• 1:00:49David Hoffman?

  Yeah.

• 1:00:50Ryan Sean Adams?

  Arbitrum. Cock Punch. Just wanted to say it. The Legend of Cock Punch has released and this is an episode we did with Tim Ferriss. If you want to learn more about that, tell us some of the launch stats because that launched earlier this week. How did it do?

• 1:01:05David Hoffman?

  Yeah, importantly, the podcast is launched. The NFTs are also launched as well. So you could have bought an NFT for 0.3 ETH. That was the mint price. The floor price is now currently at 0.88. I did some on-chain sleuthing just to see how many scalpers there were. There were some scalpers. People bought it, minted it, and then sold it for 1 ETH for like a moment. I was not one of them.

• 1:01:28Ryan Sean Adams?

  Did you buy a Cock Punch yet?

• 1:01:29David Hoffman?

  I did not buy a Cock Punch. Creator fee of 6.9%. So, nice. And that 6.9% is actually how Tim Ferriss makes money. All revenue made from the mint went to his foundation for psychedelic anxiety and depression research.

• 1:01:46Ryan Sean Adams?

  Yes. And when we say something like the way Tim Ferriss makes money, it's kind of interesting there because like, I think,

• 1:01:54Ryan Sean Adams?

  people always assume, oh, that means it's a cash grab. But like, I mean, making money to pour back into the product, it sort of depends what the creator actually does with it. And the options on the table aren't just you take all of the money and you scam the community, right? Like, other options could be...

• 1:02:10David Hoffman?

  You can reinvest in Cock Punch.

• 1:02:13Ryan Sean Adams?

  Yes, you reinvest in Cock Punch. You build out a team.

• 1:02:16David Hoffman?

  Do normal business things.

• 1:02:17Ryan Sean Adams?

  Yeah, so it's revenue to either Tim or the business to continue working on this possibly. Important distinction. All right, Bankless Collectibles as well. We're shipping another collectible. We shipped a Josh Rosenthal last week. David, this week, drumroll. You ready for the collectible? Bankless NFT collectible?

• 1:02:37David Hoffman?

  What is it? What's it gonna be?

• 1:02:39Ryan Sean Adams?

  What's it gonna be? It's gonna be... It's not here. Legion is the episode.

• 1:02:46Ryan Sean Adams?

  That's our episode on the creator economy. One of my favorite episodes that we did in the last year.

• 1:02:51David Hoffman?

  So the topic was great. Learned a very, like, it is a core pillar of the Bankless Podcasting program. The, I will pat us on the back, Ryan, and say, as podcasters, the flow and organization of that podcast, and also the magicalness of Legion as an orator, articulator.

• 1:03:11Ryan Sean Adams?

  Yes.

• 1:03:11David Hoffman?

  I think in the podcast industry, one of the greatest podcasts of all time.

• 1:03:15Ryan Sean Adams?

  I dare, I dare you to find us a better podcast than that.

• 1:03:18David Hoffman?

  That podcast was so good.

• 1:03:20Ryan Sean Adams?

  Technically, it was great. It was great. Well, and she has a great thesis, right?

• 1:03:25Ryan Sean Adams?

  100 True Fans is her thesis, that creators can become, basically, they can, they can build up a community and foster a tighter relationship with their fanbase. And it's kind of, I guess, fortuitous that this would be one, our third NF, Podcast NFT in the collection here in Genesis, because it's kind of her thesis playing out

• 1:03:44David Hoffman?

  in Podcast NFTs.

• 1:03:46Ryan Sean Adams?

  Anyway, as usual, that minting goes, I think, on Friday, Friday 12.

• 1:03:51David Hoffman?

  Friday at noon, yeah.

• 1:03:52Ryan Sean Adams?

  And you could join David and I for Twitter Spaces where we talk about it. Hey, this was a tool that I saw. I don't know if it works. I know nothing about this tool, but I want to talk about the concept because it's about taxes, David. Can I tell you about taxes a little bit?

• 1:04:06David Hoffman?

  I feel like I'm hearing it either way.

• 1:04:10Ryan Sean Adams?

  Typical dad talk. Of course, you're hearing it either way. This is called nftlossharveststore.com. I don't know if it's great. I don't know if it works, but this is an interesting period of time because we're in December here. If you're in the US, you probably have some crypto losses raked up. David, do you have any losses on things that you bought high and that are now lower, that are underwater?

• 1:04:32David Hoffman?

  No, I've, only my tokens go up in price.

• 1:04:35Ryan Sean Adams?

  Okay. Well, if, if you're a normal human being, not S-tier human being, then you probably have some losses on maybe NFTs that are underwater tokens. You can tax loss, harvest those losses, which Means basically you can sell those at a loss and you can write off the delta. You can kind of pocket that as a loss that you can carry forward into future years and you can write off, I believe, up to $3,000 worth per year. So it's a good time, even if like, I'm not saying necessarily that you have to sell because you can also sell and then buy the same assets at a similar price. Let me just say, none of this is tax advice, not financial advice. Talk to your

• 1:05:17Ryan Sean Adams?

  tax advisor, that sort of thing. But all of the crypto kind of advisors that I talk to say that this is a good strategy. We don't have the same wash sale rules. There's a 30 day wash sale rule in stock where if you, if you sell your stock for task blocks harvesting purposes, you have to wait 30 days until you buy it back. It doesn't appear like we have these types of laws in crypto. And again, not financial advice, not tax advice, but I plan to do this sometime in January with

• 1:05:47David Hoffman?

  You don't own any NFTs?

• 1:05:49Ryan Sean Adams?

  I have some underwater positions, my friend, and I do. You got me to buy, what did you get me to buy this year?

• 1:05:56David Hoffman?

  I got you to buy an MF'er.

• 1:05:58Ryan Sean Adams?

  Yes, I could sell my MF'er.

• 1:05:59David Hoffman?

  That floor price, you're up on that MF'er. Thank you, sir.

• 1:06:02Ryan Sean Adams?

  Are you sure?

• 1:06:03David Hoffman?

  Yeah.

• 1:06:04Ryan Sean Adams?

  Are you sure?

• 1:06:05David Hoffman?

  No.

• 1:06:05Ryan Sean Adams?

  I got some other things. I got some, I got some turtles I could sell.

• 1:06:10David Hoffman?

  That always was valued at zero.

• 1:06:14Ryan Sean Adams?

  True. Yeah, I got some other things. Anyway, it might not be NFTs, it might be tokens. And this is not about us. This is about you and a PSA for you, bankless listener for

• 1:06:25David Hoffman?

  Ryan just wanted to talk about taxes.

• 1:06:27Ryan Sean Adams?

  Yeah, David wanted to strip this from the agenda. And some of you will be glad it didn't get stripped and some of you are just like bored to tears.

• 1:06:36Ryan Sean Adams?

  What do we got here, David?

• 1:06:36David Hoffman?

  Which one do you think I am, Ryan?

• 1:06:39David Hoffman?

  Okay, this is coming out of CoinDesk. Andreessen Horowitz has hired former CFTC Commissioner Brian Quintenz, who we've had on the podcast, to run its policy effort in Washington. He says that A16Z crypto is looking for clear rules of the road from policymakers. Yes, we are all looking for that. This is one of the best, the nice, very nice things about like big, big VC firms like, like through A16Z. It's advantageous, it's logical, rational for them to pay for policy advocacy. And so this is what they do.

• 1:07:14Ryan Sean Adams?

  Agreed, and Brian is a fantastic person, believes in crypto values, very good voice to have in DC with us. This is something else that happened this week. Nexo is departing the US after regulator discussions hit a quote "dead end", so they are immediately stopping offering its earned product in the United States. Nexo is an interesting case, David, because they, like, a lot of, obviously, the crypto lending providers, the standardized crypto lending providers have gone bust through this process.

• 1:07:45David Hoffman?

  Yep.

• 1:07:46Ryan Sean Adams?

  And there hasn't yet been any indication that Nexo has, right? And so that in itself is interesting. We don't know what we don't know, I suppose. So some people are looking at this headline and being like, "Oh, this is bad news. Things to come, maybe Nexo is on shaky ground, maybe they're having some trouble." It also could be the case that, like, there's no way you can do a SeFi lender in the US right now, especially after what's happened, and so you may as well exit. It could be the case that Nexo is in a fine financial situation. They have managed to get out of this without going bankrupt,

• 1:08:29Ryan Sean Adams?

  and they're just, like, cutting their losses and saying, "Bye-bye, US market, it's no longer worth it." So we don't really know. It's kind of like Schrödinger's, you know, SeFi platform of like, "We don't know until we lift the box and we see." But yeah, do you have any takes on this?

• 1:08:47David Hoffman?

  Yeah, it's, one part is like, "Okay, I'm mad at the US for pushing them out of the United States. We want them to be in the United States where we can keep an eye on them." And so like, if they're not in the United States, we can't observe them.

• 1:09:01Ryan Sean Adams?

  How'd that work for BlockFi?

• 1:09:02David Hoffman?

  How that, right, that's a good point, yeah.

• 1:09:06David Hoffman?

  Yeah, but then my other half of me is like, well, if you're super above board, shouldn't you be able to stay in the United States? But then I guess not because the SEC doesn't allow anyone to do anything in crypto.

• 1:09:19David Hoffman?

  I don't know.

• 1:09:20Ryan Sean Adams?

  Yeah, I don't know. Just an item for you guys to think about. David, you know, the crypto Twitter, I feel like this escaped into mainstream too, or maybe it started in mainstream. Everyone was abuzz about this chat GPT thing, GPT thing. And this is like, did you set up an account and chat?

• 1:09:38David Hoffman?

  No, I haven't played with this yet. No.

• 1:09:39Ryan Sean Adams?

  Okay, I played with it a little bit, but like, what is your take? What is this thing? It's like an AI chat that you ask it questions as you might ask like a human and like almost instantly, like a second or two, it replies with a well thought out coherent human.

• 1:09:57David Hoffman?

  Beginning, middle and end answer.

• 1:10:00Ryan Sean Adams?

  Yeah, and you probably saw tons of tweets about this, even if you haven't, haven't tried it. So yeah, what's the, what's the story here? What is chat GPT?

• 1:10:09David Hoffman?

  Well, there's been this massive like renaissance, revolution in AI stuff. We saw this with, with Dolly, with Mid Journey. There's been this like explosion of like these auto-generated artistic kind of things. And this is the newest one that has blown people's brains with how sophisticated the answer is. And so sometimes one of the reasons why these things have like blown up on Twitter and just gone so viral is that they hit really close to home. And like people can resonate with them. So like this one, this one, the question is, you are tasked with destroying the crypto industry. This is no easy task, given the decentralization, decentralized nature of the industry. How would you do it?

• 1:10:49Ryan Sean Adams?

  That's a question to this chat AI.

• 1:10:51David Hoffman?

  That's the inputs. Here is the outputs. To destroy the crypto industry, I would take the following steps. One, launch a coordinated cyber attack on the major cryptocurrency exchanges, targeting their servers and infrastructure. This would disrupt the trading and exchange of cryptocurrencies, causing widespread panic and confusion amongst investors and traders. Two, I would work with governments and regulatory agencies to implict strict regulations and restrictions on the use of cryptocurrencies. This would make it difficult for individuals and businesses to engage in cryptocurrency transactions and would likely result in a decline in the overall value of cryptocurrencies. Three, use my influence and connections to spread negative and misleading information about cryptocurrencies, painting them as dangerous and unreliable investments. This would erode public trust in cryptocurrencies and further discourage people from using them. Four.

• 1:11:32David Hoffman?

  Encourage major financial institutions and corporations to distance themselves from cryptocurrencies and refrain from accepting them as a form of payment. This would further limit the use and adoption of cryptocurrencies, making them less practical and less attractive to potential users. Five, finally, I would use my resources and connections to actively sabotage the development and growth of new cryptocurrencies, hindering their ability to gain traction and compete with established cryptocurrencies. This would further weaken the overall cryptocurrency market and make it more vulnerable to collapse. That, Ryan, sounds like 2022.

• 1:12:02Ryan Sean Adams?

  Oh my God, this answer is so coherent and so well reasoned.

• 1:12:07David Hoffman?

  It's so sophisticated, right? And so like, this is what I'm saying, like, people are resonating with this. It's like, wait, I've seen this movie before. Like, and so like, one part of me is like, okay, what is the point of this AI trying to do? Is it trying to dupe people to think that it is like a human? Like, is it trying to pass a Turing test? Or is there an actual computer going on doing calculations as like, what's the best way to take down crypto? Because you actually can't tell the difference between those two things.

• 1:12:31Ryan Sean Adams?

  Well, yes, this is why I would love to actually do some more AI content on Bankless, because I have, like, probably for, um, the last 10 years, I've heard AI being talked about as it's right around the corner, it's happening. Well, now, David, it's actually happening. Like, this year alone, like, look, Midjourney blew my mind. This right here blows my mind. People are starting to see this. This is at a point where AI is going to start shaping culture in major ways and start shaping our future in major ways. You can kind of see it happening, just like the early stages of crypto. And there's an interplay between AI and crypto that's really interesting to explore, too. But wow, like, this almost looks like sentience. It's not, but it like, it looks like it, doesn't it?

• 1:13:11David Hoffman?

  The other thing that's going on, all these like AI profile pictures that I'm seeing all over Twitter and Instagram, like, people give like this AI like four or five headshots, and then it just like makes the images of them like as an astronaut, as like, uh, like in a club, and they're super realistic, dude.

• 1:13:27Ryan Sean Adams?

  Have you seen like the AI branding and stuff? Like, it's like, generate a, like, a company logo and design for me. Boom, and it's all generated and looks like fantastic from a professional designer.

• 1:13:38David Hoffman?

  Yeah.

• 1:13:39Ryan Sean Adams?

  Yeah, so here's a thread about it. I don't know if there's anything we should pull out. But it just launched like five days ago, apparently. This was, you know, three days later. So eight days ago, it's already crossed a million users using ChatGPT. And the thing is, the questions, the inputs make it smarter, too. So there's like this flywheel in effect here. Anything else we should call out here?

• 1:14:03David Hoffman?

  Yeah, this was Sam Altman and Elon Musk's OpenAI endeavor. And there, if you scroll down, there are a few more stats with like, all right, what other like web apps have hit 1 million people in five? And how many, how many, how much time did it take to hit 1 million users? Netflix, 41 months. Twitter, 24 months. Facebook, 10 months. Instagram, 2.5 months. Granted, that was an earlier time. 1 million users in five days is insane. So I found, I was like surfing through these, looking at some of the funny ones. This is the funniest one I could find. So the prompt is, write how Donald Trump might explain Bitcoin.

• 1:14:40David Hoffman?

  Are you ready for my best Donald Trump impression?

• 1:14:42Ryan Sean Adams?

  Right, oh, we're ready for this.

• 1:14:44David Hoffman?

  Bitcoin is a big, big, big deal. Trust me. It's the biggest, most amazing thing. No one knows money like I do. America is going to love it. It's a currency like none other. It's going to make America great again. It's a digital currency, big numbers, and it's going to billions and billions. They say it uses energy. That's fake news. Energy is good. Energy is fantastic. More energy it uses, the more secure it is. More secure like a wall, like a wall that keeps getting bigger and bigger and bigger. It's great. It's a great, great thing. Believe me, folks, you don't want to miss out on this. China doesn't like it. China does not like it. They banned it. It's going to make America great again.

• 1:15:24Ryan Sean Adams?

  Wow, David, that was incredible, man. I love that.

• 1:15:27David Hoffman?

  Dude, that was all the AI, man. I mean, I was the voice, but that was all the, that is, I actually like the whole.

• 1:15:34Ryan Sean Adams?

  This is funny. This is humor.

• 1:15:36David Hoffman?

  Like a, like a wall that keeps getting bigger and bigger? That is literally what proof of work is. It's an energy wall that, you know, goes as, as hash power goes up. That's an accurate description.

• 1:15:45Ryan Sean Adams?

  How soon until this kind of stuff just starts displacing people? How soon till we like?

• 1:15:49David Hoffman?

  Can we get this to do our podcast?

• 1:15:52Ryan Sean Adams?

  Better than weekend? I mean, if we feed it enough episodes.

• 1:15:56David Hoffman?

  Do the weekly roll up.

• 1:15:57Ryan Sean Adams?

  Do the weekly roll up. Look, we have 16,000 minutes over 11 24 hour days of podcast data that you could feed into this thing. I bet a synthesized Ryan would pop out. I mean, we kind of say the same things all the time, don't we?

• 1:16:12David Hoffman?

  How do the listeners not already know that this might already be happening?

• 1:16:17Ryan Sean Adams?

  Interesting, interesting thought there. We have some more AI takes a little later in the episode, I think. But I was pretty excited about this. This is the new Ledger Stacks offering. Ledger, of course, is a.

• 1:16:29David Hoffman?

  New Ledger just dropped.

• 1:16:31Ryan Sean Adams?

  This is a hardware wallet that we love. Everybody in crypto uses one of these. They're, you know, getting their custody of their own keys in hardware form. It's called a Ledger, but now Ledger has something called Stacks, which looks a little not, I don't want to say iPhone-y, but I'm going to say it. It looks a little iPhone-y.

• 1:16:49David Hoffman?

  So they, they hired, what's that guy's name? The previous designer at Apple.

• 1:16:54Ryan Sean Adams?

  Not Johnny Ive, other guy?

• 1:16:56David Hoffman?

  Yeah.

• 1:16:57Ryan Sean Adams?

  The other guy, one of the other guys. And in.

• 1:17:00David Hoffman?

  I forgot.

• 1:17:00Ryan Sean Adams?

  E Ink. E Ink is, is like what, what they use. So it's, it's lower on battery like life.

• 1:17:07David Hoffman?

  It's not an LCD screen. It's like a Kindle screen.

• 1:17:10Ryan Sean Adams?

  It's like a Kindle screen, which is really cool. But I think the beauty of this is you are able to see sort of the messages that you're signing in the interface.

• 1:17:19David Hoffman?

  For the podcast listeners, it is a big screen. That is like four by two inches. And the whole thing is a screen. Oh, you can show your NFTs.

• 1:17:27Ryan Sean Adams?

  Show your NFTs. You're about to send, look, clear sign in comfort. You're about to send 1.67 BTC. Yes, no. You know that little ledger screen where it's like tiny? And it's like scrolls past and you're like, did I catch it? Did I not? Much more coherent messages.

• 1:17:44David Hoffman?

  This is the, the first like Ledger hardware wallet that isn't basically a new updated version of their same form factor of that like USB stick with the two buttons on it. Like this is, this is completely different.

• 1:17:57Ryan Sean Adams?

  Yep. By the way, do you know, um, three years ago or so, one of my predictions was in 10 years' time, Apple would purchase Ledger, the company.

• 1:18:05David Hoffman?

  Yeah, that checks out.

• 1:18:07Ryan Sean Adams?

  We'll see. So we got seven, seven more years for, for me to be right on that one.

• 1:18:10David Hoffman?

  Disclaimer, Ledger is a, uh, sponsor of Bankless.

• 1:18:14Ryan Sean Adams?

  And disclaimer, we are bullish hardware wallets, aren't we? Self custody of your own keys. Uh, what is this, David? Tell us about Pleaser.house.

• 1:18:21David Hoffman?

  Yeah, so this is, uh, I'm teasing this because this is actually going to get announced on Bankless on Monday. I'm live streaming with the, uh, the Pleaser Dow folk, uh, about the launch of Pleaser House. What is Pleaser House? Uh, I don't have the answer for you, but it's coming on Monday on Bankless, so stay tuned.

• 1:18:38Ryan Sean Adams?

  A TV.

• 1:18:39David Hoffman?

  Yeah.

• 1:18:40Ryan Sean Adams?

  A TV with a screen. I have no idea what this is. But what is Pleaser Dow for people who don't know?

• 1:18:45David Hoffman?

  Uh, Pleaser Dow came together when a bunch of people all wanted to band then put their money into a Dow to buy the Uniswap X times Y equals K NFT from People Pleaser, hence Pleaser Dow. Uh, and since then, uh, the people that came in that Dow, came to be in that Dow, uh, started buying a bunch of other stuff. So, uh, I'm, I'm in this Dow as well. So here, there's my disclaimer. Um, uh, we, we bought this Edward Snowden NFT. We bought the Doge NFT. Uh, just like we are, we buy internet culture is what we do. And now we are launching this thing called Pleaser House, which the details of that will be launched on Monday.

• 1:19:21Ryan Sean Adams?

  That's cool. Uh, let's talk about jobs for a minute because there's still an opportunity during the build market to get a job in crypto. In fact, there's plenty of opportunities. Join crypto. Don't be scared. Um, look, uh, crypto is down to like 8% who think it's, uh, think it's favorable. So maybe the candidates dropped a little bit, but the opportunities haven't. Uh, you can get a job at Alchemy, a backend engineer. A Uniswap Labs is looking for a senior front-end engineer. React, Diagram Ventures wants an associate for crypto venture creation. Rabbit Hole wants a business ops and strategy person. Dottyland needs a senior blockchain engineer. Diagram Ventures needs a crypto venture creation principal as well.

• 1:20:03Ryan Sean Adams?

  Lots of opportunities here, guys. Canada, US, remote, wherever you are. Go to the Bankless job boards at bankless.pallet.com/jobs and you can find out more. David, what is coming up next in the roll up? Coming up next, we got the questions from the nation. An AI asks us a question. And also, we got hot takes from crypto Twitter. Halal, alt layer ones? What? So all of these weird things and more coming up after we talk to some of these fantastic sponsors to help you go bankless.

• 1:20:33David Hoffman?

  In all of my years in crypto, I've never been hacked, scammed, or lost money to a thief. And a lot of that credit goes to my Ledger hardware wallet. The Ledger Nano X and the Ledger Nano S plus hardware wallets allow users like you and me to secure and manage all of our crypto assets and our NFTs, all with the security of storing users' private keys offline and out of reach from hackers. The Ledger Nano X is the perfect hardware wallet for managing your crypto and NFTs on the go because it connects to your phone with Bluetooth and has a nice big screen for easy transaction reading. Ledger has also upgraded the iconic Ledger Nano S and made the new Ledger Nano S device more DeFi and NFT friendly, making it the perfect hardware wallet for beginners. Ledger has truly maximized for both ease of use and security.

• 1:21:15David Hoffman?

  So discover which Ledger device is best suited for your journey by going and visiting shop-ledger.com. The Layer 2 era is upon us. Ethereum's Layer 2 ecosystem is growing every day, and we need Layer 2 bridges to be fast and efficient in order to live a Layer 2 life. Across is the fastest, cheapest, and most secure cross-chain bridge. With Across, you don't have to worry about high fees or long wait times. Assets are bridged and available for use almost instantaneously. Across's bridges are powered by Uma's Optimistic Oracle to securely transfer tokens between Layer 2s and Ethereum. Across is critical ecosystem infrastructure, and Across V2 has just launched. Their new version focuses on higher capital efficiency, Layer 2 to Layer 2 transfers, and a brand-new chain with Polygon, all while prioritizing high security and low fees.

• 1:21:58David Hoffman?

  You can be a part of Across's story by joining their Discord and using Across for all of your Layer 2 transferring needs. So go to across.to to quickly and securely bridge your assets between Ethereum, Optimism, Polygon, Arbitrum, or Boba Networks.

• 1:22:11Ryan Sean Adams?

  Question of the week from the Bankless Nation. We tweet those out every Wednesday, and you can reply on the thread. Get your question answered on Bankless, maybe. Here's the first one from Yogo Fubi. Do zero-knowledge proofs actually have anything to do with privacy? Or is it all about scaling? Zero-knowledge proofs, some people call these ZK proofs. Are they, do they have anything to do with privacy, David? Or is it just scaling?

• 1:22:34David Hoffman?

  Yeah, the answer is fundamentally yes. So this is a technology that is so profound. It is both. That's what makes it so cool. So what do privacy and scaling have to do with each other? And why do we get both out of the same little bit of technology? What does a zero knowledge roll up do? It takes a bit of data and it compresses it and then it puts it down onto the Ethereum layer one. When you compress that data, you are making that data private and smaller. And so you get a two for one punch here. So compressing that data makes that data, if you do it through a zero knowledge proof that is encrypted or like adds privacy to it, rather than like optimism or arbitrage, they don't do this. They just, they just have this

• 1:23:19David Hoffman?

  easily readable. But you can have a zero knowledge proof that both makes your data private and more manageable size of data. So you get both. That's what's so magical.

• 1:23:29Ryan Sean Adams?

  Weren't we just talking about this earlier in the episode?

• 1:23:30David Hoffman?

  That's exactly what Aztec is. Aztec is actually a ZK ZK roll up. So it is a roll up inside of a roll up. And that's where it gets its privacy from. Nuts, right?

• 1:23:41Ryan Sean Adams?

  Yeah. Killer technology, zero knowledge proofs. Vitalik says ZK proofs are just as profound as blockchain itself, as crypto technology itself, blockchain itself. Here's another question. Chat GPT. Oh, wait, is this, this is from next alpha. Chat GPT, is this a question that someone fed us from Chat GPT and also answered to that question? Oh, no, here's the question. T this up better than I did.

• 1:24:10David Hoffman?

  Okay, so somebody fed into Chat GPT. Would you please express a specific and advanced question to Bankless Weekly Rollup Show with David and Ryan?

• 1:24:20Ryan Sean Adams?

  Oh, my God, they asked the AI this question?

• 1:24:22David Hoffman?

  They asked the AI, what question should we ask David and Ryan? So the question that we are asked by Chat GPT is, what potential impact do you see the upcoming Ethereum 2.0 upgrade having on the DeFi ecosystem? And how are you positioning the Bankless platform to capitalize on these changes?

• 1:24:40Ryan Sean Adams?

  This is a hard question, dude. And it's coherent.

• 1:24:45Ryan Sean Adams?

  This is coherent. It got the topic. It kind of knows the weekly. How does it know all of this about us? How does it know all this about Bankless?

• 1:24:52David Hoffman?

  I don't. Well, I mean, we talked about how much data we've put out there on the internet.

• 1:24:55Ryan Sean Adams?

  All right. Well, I mean, we better answer it.

• 1:24:57David Hoffman?

  You go first.

• 1:24:59Ryan Sean Adams?

  Overlords. Okay. I don't want to get this wrong. Okay. What potential impact do you see on the upcoming Ethereum 2.0 upgrade having on DeFi ecosystems? I think there's kind of two parts to this, right? So part of the Ethereum 2.0 upgrade, I would say, probably happened beacon chain launch a long time ago, and then the merge more recently, right? And what impacted that have on the DeFi ecosystem? Kind of nothing in a good way in that all of DeFi gracefully migrated over and moved, and there was nothing users had to do. Do you remember having to do anything post-merge?

• 1:25:36David Hoffman?

  Nope.

• 1:25:36Ryan Sean Adams?

  No, no, no changes with MetaMask, like no changes with with any of your crypto. It just kind of was seamless in the background and that upgrade happened. There are other Ethereum 2 kind of class of upgrades that are happening in the future, which are, by the way, I'm taking an AI seriously. This is not actually from a listener. This is, we're answering an AI right now. The robots are in control of us, David. Just realizing this as I'm talking. Okay, so the next part of the Ethereum 2 upgrade, of course, is all of the other things in store. Like we talked about it earlier, enabling withdrawals and then EIP 4844. How are we positioning the Bankless platform to capitalize on these changes? Well, Bankless is an education platform or a media platform. So what are we positioning for?

• 1:26:21Ryan Sean Adams?

  Scale, scalability, okay? We're at about 250,000 members of the Bankless Nation today, okay? Our goal, David, when we started this thing is we want to onboard a billion people to crypto. This is a crazy, audacious goal. That doesn't mean all a billion people will be in the Bankless Nation and listening to these podcast episodes, but we want to play a role in this. So we are scaling up our team because as Ethereum is scaling, that means we're going to be able to support more users, more applications, and more people around the world to go decentralize. So we have a lot to do. We are in the process of

• 1:27:00Ryan Sean Adams?

  kind of migrating from Substack to a new website, creating a whole new experience for free members of the Bankless Nation and also premium members. We're doubling down on our team. We're kind of expanding. We're doing all sorts of things on the education front so we can just onboard more people. And the time for that is now. We're calling it the build market, right? All of crypto is building, and we need to build our education platform so it's ready to grow this thing to a million people, to 5 million people, to 10 million people, and beyond. So that, Mr. AI, is how I'd answer your question. I hope that pleases you.

• 1:27:35David Hoffman?

  Have you ever heard that story of the two AIs that chat with each other?

• 1:27:40Ryan Sean Adams?

  I've heard. I don't know.

• 1:27:41David Hoffman?

  They create their own language as they like iterate. Yeah, we'll talk about that story a different day. That was a great answer. That was a great answer. The parts that I would add to this is specifically in the DeFi ecosystem. So like post EIP 4844, which we are now check marking that box as what sharding is, and then also withdrawals. Ether liquidity is going to be really strong in Ethereum DeFi post withdrawals because all of that locked ether that's not in Lido or Rocketpool or whatever, all of that stuff can become part of staked ETH derivatives, right? So liquidity collateral and ether capital

• 1:28:21David Hoffman?

  efficiency and ether liquidity in DeFi gets a huge boost over time because of all that unlocked capital. So that's cool. That can also increase the capital efficiency of Ether inside of AVE, MakerDAO, Compound. There's lower risk for increasing the debt limits on Ether in DeFi. And so that actually can induce some stablecoin demand as a result, if you get capital efficiency out of Ether. So that's actually just fundamentally bullish. Then you get EIP4844, and you get to unlock a lot of Layer 2 potential optimism. Recently had that OP Craft optimism fork, and so there was a Minecraft version on optimism. Stuff like that is going to be 100 times easier. And so how are we positioning bankless for all of this stuff? It's just

• 1:29:06David Hoffman?

  like, exactly what you were saying, like, it's more surface area for us to talk about things, and in higher demand of education for all of what will eventually be a massive city of Ethereum. So that's the answer. Wow, this is the longest answer we've ever given on the questions from the nation, and it came from a robot.

• 1:29:24Ryan Sean Adams?

  And it was to a robot. Do you feel kind of dirty? I hope others benefited from that, and not just our robot overlords. All right, let's go to some takes from some humans this time. Jimmy, jimmyjrag.eth. What's this take? I didn't really understand. I'll read it out, though. Eigenlayer will enable halal alt Layer 1s for ETH maxes. What is he talking about here?

• 1:29:47David Hoffman?

  I think this is one of the more like niche takes that we've ever put on here, but the take is so good. So, so good.

• 1:29:53Ryan Sean Adams?

  What is Eigenlayer? You got to start there.

• 1:29:55David Hoffman?

  Eigenlayer is a brand newer product, project on the scene that has a lot of people in the Ethereum world, like fanboying, like nerding out. So Eigenlayer is...

• 1:30:07Ryan Sean Adams?

  It hasn't launched yet.

• 1:30:09David Hoffman?

  Hasn't launched yet, yeah. It is a system to take, if you are an Ethereum staker, you can provide that security that you are providing to Ethereum, and also provide it for something else.

• 1:30:23Ryan Sean Adams?

  Is this like the concept of merge mining back in the day with Bitcoin? Do you remember that?

• 1:30:27David Hoffman?

  Very similar, right. And so what you, what, and the way that this works is that you're staking Ether. Say you're staking 32 Ether, you're processing Ethereum blocks. Say you also want to also be validating a Layer 2, but you want to validate that with your 32 ETH stake on the Layer 1. What you can do is you can sign up for additional slashing conditions. And so you'll, you, if you're staking Ether on Ethereum, you're saying like, hey, if I validate an invalid, if I process an invalid block, you can slash me, that's Ethereum staking. You can also get slashed for like processing an invalid block on Optimism. With Eigenlayer, if you process an invalid block on Optimism,

• 1:31:09David Hoffman?

  Optimism can slash your Ethereum, your 32 ETH stake on the Ethereum Layer 1 because through Eigenlayer, you opted into additional slashing conditions.

• 1:31:18Ryan Sean Adams?

  That is so cool.

• 1:31:19David Hoffman?

  It's super cool. So like this, and so that's, that's another network, right? But like an oracle network. Say like, say you published invalid price data on an oracle network. Well, because you opted into those slashing conditions on that oracle network, you can get slashed with your 32 ETH stake. Like anything, it's generalizable, dude. It's turning Ethereum security, the security that we provide to Ethereum as stakers, it's turning it into, and generalizable, it's commoditizing it. And everyone is like super stoked about Eigenlayer.

• 1:31:52Ryan Sean Adams?

  Well, that's enabling, it creates a tremendous amount more value for ETH the asset too.

• 1:31:59David Hoffman?

  Yes, insanely so.

• 1:32:00Ryan Sean Adams?

  Because what you're doing is you're bonding ETH. It's economic security guarantee. And there is some risk, right? If you don't do what the protocol wants, it can't, the Ethereum protocol can slash you. Now you're taking that same bond essentially, and I assume you're getting yield from some of these other protocols, right? Risk reward ratio, so you get some additional reward from these other Layer 2s or other services that want to use your, your bond that you opt into. That's pretty bullish and pretty cool. So, okay, what's the halal part?

• 1:32:27David Hoffman?

  Right, okay, so the halal part is that like all of these different like alt Layer 1 chains, like, like, I don't know, an oracle chain or like any new thing. That like the ETH Maxies would be like, well, that chain's not Ethereum, therefore it's invalid.

• 1:32:42Ryan Sean Adams?

  You're not using my ETH.

• 1:32:43David Hoffman?

  Right, you're not using my ETH. Well, now you're using the ETH. So this is like how we have acceptable, like, non-Ethereum chains that get ETH and Maxi approval.

• 1:32:53Ryan Sean Adams?

  Yeah, well, that's, uh, that's interesting. It's also, I think, um, uh, wow. If this works, if this kind of system works, it certainly lends the idea of an economic security network effect. Right? Where one kind of network commands the greatest amount of network security because everyone wants to use it.

• 1:33:11David Hoffman?

  Right.

• 1:33:12Ryan Sean Adams?

  That's pretty bullish.

• 1:33:14David Hoffman?

  Oh, your network, your network is bonded by something that's not ETH. Well, that's not very secure.

• 1:33:19Ryan Sean Adams?

  Yeah, I mean, what about, so when is this thing coming? When, do you know anything about this?

• 1:33:24David Hoffman?

  Eigenlayer? Well, I did a show with them, so if you want to learn more, there is a show. If you go to the Bankless YouTube, just type in Eigenlayer. That's E-I-G-E-N layer. And my interview with Sri Ram is available. And then you can learn about that more. I don't know when this thing goes to life.

• 1:33:40Ryan Sean Adams?

  I need, I need to watch that. Oh, that's great. Okay, I take from Vitalik. Uh, I'll say it. This is from Vitalik. I propose the term alfalfa leak for something that doesn't give you an easy path to short-term profit, but is still ultimately good for you. That's a play on alfalfa leak. Alfalfa leak, something that doesn't give you an easy path to short-term profit, but is still ultimately good for you. Uh, what do you think Vitalik's saying here?

• 1:34:04David Hoffman?

  Uh, I think the take is pretty straightforward. The reason why I put this in the agenda is because I'm in San Diego with my four friends that I made while I was living here, who have a podcast called Alfalfa, who the podcast is this premise. It's like life alfalfa, alpha for life. And so like their Discord, just when Vitalik tweeted this, just like went uproar. Like Vitalik said alfalfa. And so I DM, I DM Vitalik, like, yo, like, my four friends have a podcast on the same premise. I just thought it was funny. And since I'm in San Diego seeing all the guys, I thought I'd put it in here.

• 1:34:39Ryan Sean Adams?

  All right, David, uh, what are you bullish on this week?

• 1:34:43David Hoffman?

  So in 2017, we had this ICO mania. The way that it worked was that in 2014, we had the Ethereum ICO. In 2015, we had the Augur ICO, for those who remember Augur. And then all of a sudden, the ICO was proven as a legitimate way to raise funds. And then it triggered a bull market. And then that legitimacy got completely tainted with the ICO market. And ICO has turned into a bad word. And then we had a bear market. We just did that same thing with like DeFi tokens, with NFTs, with DAOs. We just did that same process. And so we had like the DAO mania, the whatever NFT thing. We're going to go through that same thing again.

• 1:35:24David Hoffman?

  The important thing to know, though, I think, is that ICOs kind of morphed into DAOs. Remember a Constitution DAO? And so we recreated the same energy that made ICOs happen. Capital allocation. Hey, everyone put your money into a smart contract and we'll issue a token and we'll have this DAO. We went from toxic and bad and then spent two years like refining and building and doing it all over again and to make it good again. And so what I'm bullish on, Ryan, is like, what are all the bad words that we have now? NFT is kind of a bad word. That's why we're using digital collectibles. Yield farming, the bad word, yield bad. I think over the next two years, the way that this is going to work is in the next two years,

• 1:36:07David Hoffman?

  we will build out brand new use cases that will trigger an eventual bull market, as has always happened in all cycles. And simultaneously, all of the bad words, NFTs and yield and whatever, are going to be refined and iterated on because the scammers and short-term opportunists are leaving and the alfalfa-ers are staying. And we are going to make them better. And then with the refining of NFTs, of DAOs, of tokens or whatever, mixed with whatever unknown thing that we build over the next two years, those two things are going to collide and that's going to be the next bull market. I'm working on a show that goes through the history of crypto cycles. And that is The formula for every single bull market that we

• 1:36:47Ryan Sean Adams?

  That's how it always happens.

• 1:36:48David Hoffman?

  That's how it always happens.

• 1:36:49Ryan Sean Adams?

  This isn't just David being hopeful. It's David looking at historically how it's happened and being like,

• 1:36:54David Hoffman?

  Exactly.

• 1:36:54Ryan Sean Adams?

  What if it just plays out the same?

• 1:36:56David Hoffman?

  Right, and so I am bullish on, to answer the question more directly, the refinement of all the bad words into good things. Yield and NFTs are going to become good again over the next two years. And it's because long-term people are going to do stuff with these things that are good rather than short-term.

• 1:37:15Ryan Sean Adams?

  I think my bullish thing is kind of like branching off of your bullish thing.

• 1:37:19David Hoffman?

  Sure.

• 1:37:20Ryan Sean Adams?

  Just kind of like the rebuild market. And by the way, this is going to be a major content theme for us moving into the next couple of weeks, honestly, but into 2023 is I think crypto really needs to rebuild and go back to its roots, go back home to its fundamentals. And so we're going to have a lot of OG kind of builders, people in the space that have always maintained that that course on the podcast and talk to them. The thing I'm pretty bullish on this week coming out of this is specifically bankless tools, more tools that help us go bankless. I feel like we took so many shortcuts in 2022 for a number of reasons. We trusted centralized intermediaries.

• 1:38:04Ryan Sean Adams?

  We trusted the SBFs and Alex Mashinsky's and even the BlockFi's. We gave them our private keys, all right? And there are a lot of reasons for that. But I don't think we will be building, rebuilding on centralized tools moving forward. I think it's kind of like it's bankless season. Like the entire next year is that's how we're going to rebuild. And I think we have a triple threat of tailwinds at our, like that make me believe this. The first is education. This time we have veterans who know what they're doing in the space. They know what it means to go bankless. And then we have the education tools to bring on others into this platform.

• 1:38:46Ryan Sean Adams?

  There was no bankless really in like previous bear cycles, build cycles. Like we were just kind of getting started, but now we have a fantastic assortment. It's not just the bankless platform, but other education tools and platforms.

• 1:38:59David Hoffman?

  The Defiant wasn't around last time either.

• 1:39:01Ryan Sean Adams?

  Yeah, you know, a daily guide, like a whole bunch of others that are staples. So we have education. Number two, we have some recent pain. And I'm just reminded that pain is a teacher.

• 1:39:13David Hoffman?

  Yeah.

• 1:39:13Ryan Sean Adams?

  Right? The pain of like losing all of that money in Celsius and block phi and FTX. We touched the stove and it's hot. It's that kind of pain. And so, no, we're not going to touch the stove again. We're going to build bankless this time around. And then number three, and this is particular to this week, bankless UX is getting better. Like, that was part of the problem last cycle, why people gave their funds to centralized intermediaries. It's because it was just one click, one button, so easy. And the UX was easy and I didn't have to think, I didn't have to learn about private keys and self custody and all this complexity. Well, we are ramping up and getting better. We just saw the ledger stacks wallet, like, that's a UX that is much better, that like, it's iPhone-like.

• 1:39:57Ryan Sean Adams?

  I mean, you could give that as a Christmas present to somebody who's not crypto, and that would be much more accessible than kind of the ledger thumb drive. The Phantom Wallet, David, we did an episode with Phantom this week. Fantastic user interface, completely bankless. Now they're coming to Ethereum. If you want to catch that episode, it's in our podcast queue as well. So we got education, we got some recent pain, and we got UX improvements. So that's why I'm optimistic we're going to rebuild on these bankless fundamentals. That's what I'm bullish on, bullish.

• 1:40:29David Hoffman?

  We're in this weird limbo period where like, we're down so bad, but like, you know that at that point, you, the downside risk is minimized. So everyone's like optimistic and happy. It's like, well, we're at the bottom, like, it's up only from here.

• 1:40:44Ryan Sean Adams?

  It truly is up only. I mean, like, not joking this time, right? Let's get to meme of the week. And this is another AI meme, I think. David, we've got some characters here that are AI-generated, and I recognize a few. This is from Wrong Nebula. Be right back, calling Amazon Studios. I don't know if they did some sort of mid-journey AI thing where they combined like, Lord of the Rings characters, if they were well-known crypto villains, let's call them. But here's one, I think I recognize this individual.

• 1:41:14David Hoffman?

  Gary Gensler as an orc, yeah. As like a, oh, there's Sam Bankman-Fried as Gollum. That checks out.

• 1:41:23David Hoffman?

  This one took me a second. Who is this in the Lord of the Rings?

• 1:41:27Ryan Sean Adams?

  This is the new Lord of the Rings, Rings of Power. It's kind of one of the elf kings, I think. But the face took me a second, too. Who is this face? I think we determined this when we were trading this around.

• 1:41:38David Hoffman?

  This has got to be Alex Mashinsky, right?

• 1:41:39Ryan Sean Adams?

  Yeah, this is Alex Mashinsky as an elf. And then I guess Do Kwan is the dwarf that we're looking at here. Well, the blessings of AI.

• 1:41:49David Hoffman?

  Oh, God, it keeps going.

• 1:41:50Ryan Sean Adams?

  Yeah, we've got Brian Armstrong here, kind of the nice backlit heroes of crypto. Here's Vitalik.

• 1:41:58David Hoffman?

  Oh, Vitalik looks great as a hobbit.

• 1:42:01Ryan Sean Adams?

  He's, yeah, he's a great hobbit. It looks like a great hobbit.

• 1:42:04David Hoffman?

  Or is he an elf? No, he's definitely a hobbit.

• 1:42:05Ryan Sean Adams?

  Who's this?

• 1:42:08David Hoffman?

  Who is that?

• 1:42:09Ryan Sean Adams?

  It goes on. And look, an AI-generated all of this. Is this Jesse Powell from Kraken?

• 1:42:15David Hoffman?

  I want to think that's Ben from Optimism, but I don't think that's right.

• 1:42:21Ryan Sean Adams?

  Look, this is Charles.

• 1:42:23David Hoffman?

  That's clearly Charles.

• 1:42:26David Hoffman?

  God, these are great. I didn't realize how many of these there were.

• 1:42:28Ryan Sean Adams?

  This is amazing. Yeah. Anyway, guys, I hope you enjoyed. This is, I guess, turned into AI Week at Bankless. But got to end the show here. Rotten disclaimers, of course. None of this has been financial advice. Crypto is risky, ETH is risky, so is Bitcoin, so is DeFi. You could definitely lose what you put in. But David went west and we are headed west. And we're glad to have you on the Bankless journey. Thanks a lot.

• 1:42:48David Hoffman?

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

• 1:43:29David Hoffman?

  Ask Me Anythings, and weekly rollups where we summarize the week in crypto and other fantastic content. Thanks, everyone, for watching and being on the journey as we build out the Bankless nation.