ROLLUP: CZ Busted?! | Gensler Testifying Soon | SBF in More Trouble | War on Crypto Continues

Bankless Weekly Rollup Last Week of March 2023 ------ 📣 Infura | New SDK for NFT APIs For Devs https://bankless.cc/Infura ------ 🚀 JOIN BANKLESS PREMIUM: https://www.bankless.com/dashboard ------ BANKLESS SPONSOR TOOLS: ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum 🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE https://bankless.cc/kraken 🦄UNISWAP | ON-CHAIN MARKETPLACE https://bankless.cc/uniswap 👻 PHANTOM | FRIENDLY MULTICHAIN WALLET https://bankless.cc/phantom-waitlist 🦊METAMASK LEARN | HELPFUL WEB3 RESOURCE https://bankless.cc/MetaMask 🚁 EARNIFI | CLAIM YOUR UNCLAIMED AIRDROPS https://bankless.cc/earnifi ------ Topics Covered 0:00 Intro 3:56 Markets 5:49 2/3 of QT reversed https://twitter.com/biancoresearch/status/1639004727001358339 17:41 Staking tokens up - April 12 is the date https://decrypt.co/124812/ethereum-staking-tokens-shanghai-upgrade-gets-date 19:14 Arbitrum https://l2beat.com/scaling/projects/arbitrum https://twitter.com/TingHu888/status/1638884726441410561 21:00 How much ETH is lost forever? https://twitter.com/jconorgrogan/status/1637944295746412549 26:50 Binance gets busted https://www.cftc.gov/PressRoom/PressReleases/8680-23 https://twitter.com/Bonecondor/status/1640376962999787521 https://twitter.com/Bonecondor/status/1640398821153816592 https://www.binance.com/en/blog/from-cz/czs-response-to-the-cftc-complaint-2408916493005890282 https://twitter.com/blockbytescom/status/1640370581949362182 35:18 War on Crypto continues https://www.whitehouse.gov/wp-content/uploads/2023/03/ERP-2023.pdf https://twitter.com/FEhrsam/status/1638247809488150529 https://twitter.com/ryansadams/status/1640511693045346305 43:20 Crypto has its defenders even outside of crypto! https://twitter.com/nic__carter/status/1640494485456003072 https://twitter.com/FinancialCmte/status/1640804417850036227 https://twitter.com/Dennis_Porter_/status/1640144615843188737 https://www.bankless.com/congressman-tom-emmer-tackles-the-war-on-crypto https://decrypt.co/124872/sec-gensler-insists-clear-rules-crypto-already-exist https://twitter.com/RyanSAdams/status/1641060548312813570 57:38 ETH 57:45 Polygon ZkEVM launched https://twitter.com/BanklessHQ/status/1640745582644830210 59:48 Consensys launched their zk-rollup Linea https://twitter.com/LineaBuild/status/1640639901292015616 1:00:18 L2Beat introduced Risk Rosette https://twitter.com/l2beat/status/1640302851900465154 1:02:39 Euler https://etherscan.io/tx/0xf69c53b82273764989cdecf75b6daabb0c0bd30b4e659bca080948126c1f992c https://etherscan.io/tx/0xf69c53b82273764989cdecf75b6daabb0c0bd30b4e659bca080948126c1f992c 1:05:39 MakerDAO https://twitter.com/MakerDAO/status/1641106700756213760 1:07:18 NFTs Ticketmaster debuts NFT-gated ticket sales https://business.ticketmaster.com/business-solutions/nft-token-gated-sales/ 1:09:56 Microstrategy https://www.coindesk.com/business/2023/03/27/microstrategy-pays-off-silvergate-loan-buys-more-bitcoin/ 1:11:07 Nasdaq to launch crypto custody service in Q2 https://twitter.com/watcherguru/status/1639236196894121984 1:11:40 Avalanche C chain out of order for +50 minutes https://twitter.com/kevinsekniqi/status/1638712640242319364 1:12:27 U. S. charged SBF from bribing China https://www.reuters.com/legal/ftxs-bankman-fried-charged-with-bribery-conspiracy-new-indictment-2023-03-28/ 1:13:05 Pause on training AI https://futureoflife.org/open-letter/pause-giant-ai-experiments/ 1:16:44 Dune Integrates Chat GPT4! https://twitter.com/DuneAnalytics/status/1640386318000611329 1:18:48 MetaMask is integrating SiwE natively! https://twitter.com/SpruceID/status/1639043625047977985 1:21:00 Kraken partnership with Williams Racing https://twitter.com/krakenfx/status/1640700416156397571 1:22:33 Conduit https://twitter.com/conduitxyz/status/1640731248124637185 1:23:33 Jobs https://bankless.pallet.com/jobs/f39528ec-e381-4c1f-a9ad-907e69ac27bf 1:27:06 Questions from the Nation Bigwiggle501 Goggart RocketPoolster 1:34:18 Takes https://twitter.com/TrustlessState/status/1639621702115049477 https://twitter.com/friedberg/status/1641206963538399234 https://twitter.com/RyanSAdams/status/1641270392948944896 1:43:55 What David’s Bullish On 1:46:00 What Ryan’s Bullish On 1:48:25 MEME of the Week https://twitter.com/biancoresearch/status/1639086175721000961 https://twitter.com/Fiskantes/status/1640388198215069699 1:49:44 Risks & Disclaimers ---- Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here: https://www.bankless.com/disclosures

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

• 0:00David Hoffman?

  Gary Gensler to the principal's office? Can we get Gary Gensler to the principal's office?

• 0:06Ryan Sean Adams?

  Wait, I thought he was the principal. You can bring him to another office?

• 0:09David Hoffman?

  There's, there's the principal's principal, which he is now going to. Yeah. So he has been summoned.

• 0:17Ryan Sean Adams?

  Bankless Nation, it is the last Friday of March. It's time for, what is it, David?

• 0:22David Hoffman?

  Uh, the Bankless Friday Weekly Roll-Up, where we cover the entire weekly news in crypto, which is always an ambitious endeavor. This week is a medium week, not so bad, so everyone can take a breather. Medium, still, still a lot happened, though. So, yeah, we persevere nonetheless, regardless of whether it was a big week or a medium week in crypto, and here we are.

• 0:41Ryan Sean Adams?

  You have to, you have to keep going, right? Because you never know which roll-up might be the last roll-up. You just never know. Life is uncertain, David. A few topics of the week, though. Oh, I gotta start here. You're not in your usual place, though.

• 0:53David Hoffman?

  No.

• 0:53Ryan Sean Adams?

  A different background.

• 0:54David Hoffman?

  Different background, yeah. I am currently in Montenegro, which is not an ever a spot that I ever thought I'd be, to be honest.

• 1:02Ryan Sean Adams?

  Wait a second, wait a second. Isn't that the place Do Kwon was just found? Or like, late last week, Friday of last week? And you are there, too?

• 1:10David Hoffman?

  I was at the same airport that Do Kwon, Do Kwon was at, like, five days ahead of me. Yeah, I'm, I'm on the hunt for Do Kwon. That's what I'm doing.

• 1:22Ryan Sean Adams?

  People don't know right now whether you're joking or what's going on, but we'll just let the mystery continue. We got some topics of the week. Number one, there is a CFTC versus Binance battle. Binance getting busted by the CFTC. We're going to dig into that. What else, David?

• 1:36David Hoffman?

  ZK EVM continues. We got two of them this week. Last week, we had one. This week, we have two.

• 1:43Ryan Sean Adams?

  They're doubling every week.

• 1:44David Hoffman?

  Yeah, every week. So far, they have been doubling every single week for two weeks in a row. And then lastly... Gary Gensler to the principal's office? Can we get Gary Gensler to the principal's office?

• 1:56Ryan Sean Adams?

  Wait, I thought he was the principal. You can bring him to another office?

• 1:59David Hoffman?

  There's, there's the principal's principal, which he is now going to. Yeah, so he has been summoned to testify? Are these the right words? In court? About his actions against the crypto community.

• 2:12Ryan Sean Adams?

  In court? Is it in court or in Congress?

• 2:14David Hoffman?

  No, not in court, not in court, in front.

• 2:16Ryan Sean Adams?

  The court of the people, which is Congress.

• 2:17David Hoffman?

  Gary Gensler to face Congress grilling over crypto policy. Gary Gensler will testify before the House Financial Services Committee. Okay, so Gary Gensler is testifying in front of the House about his treatment of us. There we go. Those are the details.

• 2:30Ryan Sean Adams?

  I'm here for a good Gensler grilling. I'm here for it. Let's do it.

• 2:34David Hoffman?

  Product market fit.

• 2:36Ryan Sean Adams?

  Exactly what I want. Speaking of product market fit, we got to talk about our friends over at Infura because they have an API, NFT API, that I think has some product market fit. David, tell us about it. This one's for the devs, isn't it?

• 2:49David Hoffman?

  Yeah, this is for the devs. So this is an SDK for an API, for your NFT DAP, if you will. So whether you are.

• 2:57Ryan Sean Adams?

  And if you don't know what that means, you're not a dev.

• 3:00David Hoffman?

  So just absorb this knowledge through osmosis. I'll brute force it into your brain. So Infura has got an SDK for you, the NFT builder out there. Whether you are doing most of the things that NFT contracts do, selling an NFT, buying an NFT, minting an NFT, Infura has got an SDK for you to make that easy for you. Three smart contract templates to allow you to write onto eight different blockchains and mint NFTs, either ERC 721s or 115 tokens, to really expedite the building of your NFT process, your NFT application. There is a link in the show notes for you to get started. You can sign up an account with Infura to get started, or you could just go to bankless.cc/infura.

• 3:43Ryan Sean Adams?

  There it is. Well, help me shill an NFT. That's another verb that's often used.

• 3:47David Hoffman?

  Hey, we all start somewhere, but that's not in specifically the API.

• 3:52Ryan Sean Adams?

  Okay, can't help you shill. Can help you do everything else, though. Click the link in the show notes, guys. Got to get to the markets, David. What is Bitcoin telling us on the week?

• 3:59David Hoffman?

  Bitcoin down half a percent, which I consider flat. So started the week at 28,000-ish currently, or 28,700 currently at 28,420. Flat, flat, flat week for Bitcoin.

• 4:14Ryan Sean Adams?

  On the week, I'll take a flat. How about ETH?

• 4:17David Hoffman?

  ETH, down 2.3% on the week, started the week at $1,825, currently at $1,795, 2.5% down.

• 4:27Ryan Sean Adams?

  I mean, all this, not bad considering, right? Not considering that the world's on fire.

• 4:31David Hoffman?

  Yeah.

• 4:32Ryan Sean Adams?

  Interesting. I think we'll get into that in a little bit. How about the ratio? What's that saying on the week? Also flat?

• 4:37David Hoffman?

  Down 2%, so 0.063. So I believe the third consecutive week of a down ratio price.

• 4:45Ryan Sean Adams?

  Bitcoin still has that strength.

• 4:47David Hoffman?

  Bitcoin's dominant, yeah.

• 4:49Ryan Sean Adams?

  How about total crypto market cap?

• 4:51David Hoffman?

  1.23 trillion dollars. 123.

• 4:55Ryan Sean Adams?

  Not too bad. Look, I consider all of this a win in this economic environment. A bear market, right?

• 5:02David Hoffman?

  Just like, hopefully, this is not only narrative. Hopefully, there was actually real new buyers of Bitcoin in the last, since the last banking crisis. The worst case scenario would be that it was just sidelined crypto traders who had a bunch of stable coins, who then decided to buy on the narrative that real buyers would be coming. That's what we don't want to be true. What we do want to be true is bankers were like, Bitcoin, okay.

• 5:28Ryan Sean Adams?

  I think that's probably still early. I think it's all still the same recycled buyers, but that's how all of these things start.

• 5:34David Hoffman?

  That's the bear case.

• 5:35Ryan Sean Adams?

  That's still the bear case, but it doesn't mean that they're wrong right now and you have to start somewhere. And you always start with that foundation of existing buyers who are like, I'm a little scared. I'm going to stable coins. And then they buy back in. I think this might be the story as to why, David, and this to me looks like fundamentals. This is from Jim Bianco. This is the Fed's updated balance sheet. You can see the numbers here. Now, 2/3 of the quantitative tightening has been reversed. So over the course of, starting in 2021, all the way to up till March, the Fed had been, actually, sorry, from 2022, March of 2022 or so, up till 2023, a full year, the Fed had been tightening.

• 6:15Ryan Sean Adams?

  They had been destroying assets on the balance sheet, decreasing the balance sheet, I should say. And it went from like $9 trillion all the way to 8.35 trillion. So they got $700 billion in decrease in the Fed balance sheet. And then what happened, David?

• 6:34David Hoffman?

  Then $500 billion came back inside of two weeks. So nice try Fed. You guys, you guys really did your best. And Ryan, you're saying, you said we, the Fed was able in the last year, again, the interest rate started March 2022. Now we are in March 2023, one year. So we had good, a good old, good old try, a good old, good old fashioned Fed try.

• 6:59Ryan Sean Adams?

  Good old college try.

• 7:00David Hoffman?

  Good old college try. We started at basically $9 trillion. So when you said we shaved off $700 billion, we started from $9 trillion. So $700 billion is a lot of money. It's quite a lot of money. We started from $9 trillion. We got down to basically $8.3 trillion. And then in the last, it took us a year to go from $9 trillion to 8.3 trillion. And now it took us two weeks to go from 8.3 trillion to 8.7 trillion, 75 trillion.

• 7:32Ryan Sean Adams?

  David, this seems to be the big debate.

• 7:33David Hoffman?

  You had a good run Fed.

• 7:35Ryan Sean Adams?

  Well, like, there's still some debate here. So a lot of people are still saying, including Ben Hunt, whom we had on the podcast as part of kind of, are the banks insolvent? Is the dollar going to hyperinflate? Says this spike right here is just temporary. You know, he always uses the analogy of like, you inject liquidity right into the heart, right? This is kind of the like, wake up the patient kind of needle. And then it goes back down eventually. Whereas Bology, Arthur Hayes say, uh-uh, this is permanent. And by the way, this spike, you ain't seen nothing yet. This is going to continue to increase. Bology is like, in 90 days, this is going to be massive. Whereas Arthur Hayes thinks it will take years. Jim Bianco gave us a pretty reasoned take, I feel like, was, was

• 8:18Ryan Sean Adams?

  kind of in the middle. Wait and see. How would you summarize Jim Bianco's take from our episode earlier this week?

• 8:24David Hoffman?

  Jim Bianco is towards the Ben Hunt end of the spectrum. So I would say Bology and Arthur Hayes are actually pretty close to each other in terms of their position. Like Bology saying 90 days until Bitcoin's $1 million, which is very fast. Arthur Hayes saying two years to $1 million, which is still very fast.

• 8:42Ryan Sean Adams?

  He's saying two years, maybe a million. On the table in two years.

• 8:45David Hoffman?

  Yeah. Ben Hunt is like, that's complete noise and ridiculousness and actually totally irresponsible. And Jim Bianco is less emotional, I'd say, than Ben Hunt is, but still directionally agrees with Ben Hunt saying that, yes, this line that we are looking at on the screen is extremely vertical. We just erased two years of rising interest rates. Think of all the, the pain in the market that we've had for the last year, excuse me, the year of interest rates. And think about the pain that we've had. And then we just erase all of that progress from the Fed's perspective inside of two weeks. Jim Bianco says, okay, but this spike that we've had is not systemic. It doesn't mean the same amount of QE and liquidity injection that STEMI checks do.

• 9:30David Hoffman?

  And so this is much more contained, compartmentalized to just the banking sector. And it's not going to leak out to the actual bank accounts of, you know, mom and pop and Joe and Alice. Right. And so I think, I think this is actually, and of those four interviews that we did. And damn, did we really try and get down to the bottom of this. And I feel like we did with Jim Bianco.

• 9:54Ryan Sean Adams?

  Yeah, I feel, I feel closure on this, honestly. I went in being like, let's get two sides of the story here. And what we ultimately ended up getting is like four different perspectives, which is, which is actually closer to reality. I mean, things are complicated. Real life is complicated. And so getting all of those four perspectives, kind of, yeah, I feel closure on it anyway. This is another piece of the macro story here. This is Elf saying the same thing, macro Elf, that is. It took 215 years for the US to reach seven trillion in debt. This is, he's zooming out here. Then it took only 27 months, March 2020 to June 2022, to add another seven trillion.

• 10:34Ryan Sean Adams?

  215 years to get to the first seven trillion, David, and then 27 months to get to the next seven trillion. This is of course, all of the outstanding debt, you know, from COVID. This is the big jump right here, these 27 months. This is the big story, I think, here of like, if you zoom out a little bit, even past the two year mark, look how large and how fast the Fed balance sheet has actually grown.

• 11:01David Hoffman?

  Yeah, he also finishes that tweet saying debt is not a bug of our credit-based money system, it's actually a feature. What does he mean by that? I'm confused by that.

• 11:11Ryan Sean Adams?

  I think he's saying central banks are kind of designed to do this. This is what they do.

• 11:15David Hoffman?

  I mean, this is the nature of like compound interest, right? So like when you see an exponential curve like that, I don't think it should be totally like foreign that this is happening because I mean this when you inflate a currency at 2% per year, this is actually the the same shape of the chart that it would look like. This is certainly more than 2% per year, but this is what happens.

• 11:34Ryan Sean Adams?

  Did you listen to so Ben Hunt's strongest point to me is like you can have a hard money Bitcoin type of or Ethereum type of monetary system because what you lose is credit. You lose this the ability to pool social credit together and that's what a fiat regime brings. And by the way, he would argue the last, you know, 100, 150 years of economic prosperity, everything we enjoy in a modern economy is because we have that social credit. We have that trust. And so he really rejects the the idea that we would kind of go back in time and reestablish things. That so that's his take. And I think maybe macro office saying something similar

• 12:16Ryan Sean Adams?

  in debt is not a bug of our credit-based money system. It's it's a feature, right? How else do you get credit, David, in kind of a hard money, hard asset regime? That's the the question Ben Hunt posed. And I understand elements of that. And Jim Bianco kind of echoed that. And he's like, hey, banks actually play this is bankless, but banks play a function. Did you know the function that they play is not as a data is not as a money warehouse? That's kind of stupid. I mean, we can hold our own private keys. We don't have to warehouse our money inside of a Wells Fargo. But the role that they do play is like small community credit creation. And that is a role that right now DeFi and cryptos is not fulfilling. And there is some role for banks in that world. So I understand that perspective, too.

• 12:58David Hoffman?

  Yeah, I think the thought experiment to really understand this metaphor that Ben Hunt was saying was that say, say we have a Bitcoin standard, you could have a bank that have Bitcoin that has Bitcoin deposits that operates on a fractional reserve system. So they take in 10 Bitcoins and then they lend out 100 Bitcoins and then they charge interest rates to get that back. The, the, the reason why, so in theory, like you could still get credit in a Bitcoin system. If you had just like a Bitcoin bank that denominated in Bitcoin and did the whole fractional reserve thing, that's technically still possible. The reason why the economics would still be different is that in the Bitcoin banking system with a Bitcoin standard with Bitcoin credit, you actually don't have a Federal Reserve which can mint Bitcoins on the other side to backstop

• 13:41David Hoffman?

  banks if something goes wrong. And so even in a Bitcoin banking system, you still have much more credit risk because again, if the bank goes insolvent, you have somebody who can print Bitcoins on the other side, which allows for more credit at lower interest rates, therefore more investment in the future, therefore ultimately more debt on the Federal Reserve's balance sheet to happen.

• 14:02Ryan Sean Adams?

  Yeah, this is my question. Look, look at this chart, David. So this central bank chart, how does this chart compete against this chart? Something like this crypto economic system. By the way, for, for those not seeing in podcast, like just listening to this. So the Fed balance sheet is obviously, you know, spiking up, expanding at a precipitous rate. And I just pulled up ultrasound money, which is Ethereum, supply decreasing.

• 14:28David Hoffman?

  Those charts look inverted to each other.

• 14:30Ryan Sean Adams?

  So which do you want to hold? Do you want to hold treasuries in the dollar? Or do you want to hold this thing? That's what I don't think central bankers have fully calculated that now there is another option, a better option.

• 14:43David Hoffman?

  And we get, we do get to have both. Like we want to, as individuals, hold Ether because of its deflationary properties and it's a store of value over the long term. And as a society, we also want fiat so we can get a home loan, for example. Both are good. Both have their, both have their, I think you can totally have both.

• 15:03Ryan Sean Adams?

  Yeah, but I'm not holding this one.

• 15:04David Hoffman?

  I'm not holding dollars, though. I am. Well, so like I have a home loan. I have debt in dollars. I love debt in dollars.

• 15:13Ryan Sean Adams?

  Oh, don't you? Isn't it great? You ever look at your mortgage and you're just like, oh, my God, that is just inflating away. That is getting less expensive over time.

• 15:24David Hoffman?

  Right.

• 15:24Ryan Sean Adams?

  Fantastic.

• 15:25David Hoffman?

  Meanwhile, I've got ether on the other side. Like, that is a beautiful symbiosis.

• 15:30Ryan Sean Adams?

  For you, it is. Definitely.

• 15:31David Hoffman?

  For me.

• 15:32Ryan Sean Adams?

  I don't know what it does to society. I mean, this is what we're grappling with. This is Chris Berninski's take on this, on this whole thing, David, which is, he says this, maybe this kind of sums up the discussion we've had. A number of people asking me what I think about in the context of the current banking crisis, regulatory fights, Bology's bet, and so on. So here it goes. Current banking crisis is bullish for crypto long run. Short term, we're likely in the eye of the storm, so expect volatility. But the banking crisis has been a monetary induced policy. Too much, too fast with rate hikes, and will be solved by monetary policy. Fed and other central banks will drop rates, perhaps even this year, as the market is now anticipating, which will allow existing bonds to rally. And voila, banks that are currently struggling will have healthy balance sheets, again, in quotes.

• 16:16Ryan Sean Adams?

  This banking crisis is also more likely to cause disinflation than hyperinflation, in Chris's opinion. Credit is drying up. That's interesting. BTFP isn't the same as Stimmy's. Stimmy's went straight to consumer spending, whereas BTFP is shoring up bank balance sheets, which is likely to just sit there. But disinflation will give the Fed and the other central banks cover to lower rates. And that will breathe air back into the fire of growth stocks and crypto, turning to regulation and crypto. And then he ends with this. As for Bology's bet, I don't take him literally, but more as directionally alerting people. In this distracted day and age, sometimes you need to do severe things to get people's attention. He's done that. But as I said earlier, I think disinflation from here is

• 17:00Ryan Sean Adams?

  more likely than hyperinflation, at least for the coming years. Really interesting take here is, Bology was kind of being intentionally memetic about this. And the bit signal, 90 days, a million dollar Bitcoin bet, that was him intentionally kind of being...

• 17:22Ryan Sean Adams?

  Hyperbolic about this.

• 17:24David Hoffman?

  He said he wasn't, he said he wasn't doing that.

• 17:27Ryan Sean Adams?

  Yeah, I know.

• 17:27David Hoffman?

  He said on the podcast that this is not him doing a marketing stunt.

• 17:32Ryan Sean Adams?

  Yeah. Well, so I, another reasonable take from Chris and I guess we'll see. We are what, you know, 80 days left, 75 days left.

• 17:40David Hoffman?

  Yeah.

• 17:41Ryan Sean Adams?

  Speaking of upcoming dates, what do we got happening pretty soon, David?

• 17:45David Hoffman?

  We got withdrawals happening pretty soon, Ryan. Ether withdrawals coming. The date is April. What's the date? If you scroll down, I can read it up because I don't have it memorized. April 12th, April 12th. And so LSD tokens are getting a nice little bump in their price because of the incoming

• 18:02David Hoffman?

  Shanghai upgrade. So this is when we can, as validators, withdraw our ether and ether just gets violently sold into the market. And the ether goes to zero, crashes. Yeah, that's what happens next.

• 18:14Ryan Sean Adams?

  Well, what do you think's gonna happen at withdraw? It's up or down? Prices go up, number go down? What do you think?

• 18:19David Hoffman?

  Flat, flat.

• 18:20Ryan Sean Adams?

  Yeah. Staking tokens going up now.

• 18:22David Hoffman?

  Flat, first, first flat, maybe for a week, maybe for two weeks. And then people will realize that it was quite literally a bullish unlock in the sense that the stakers just aren't dumping their ether because stakers are inherently bullish ether. And then people will realize that everyone that hasn't bought ether in the last month because they're fearful of the staking withdrawal unlock are gonna be like, oh, it's over. And the stakers didn't sell. Well, I'll guess I'll buy back my ether and then we go up.

• 18:51Ryan Sean Adams?

  David thinks the unlock will be bullish. It'll be flat and bullish.

• 18:55David Hoffman?

  Flat for a week-ish and then bullish. Yeah.

• 18:58Ryan Sean Adams?

  I don't have a strong opinion on that, so I'll just take yours. Sounds good, David. Tell me about Arbitrum.

• 19:02David Hoffman?

  Are you surprised that my conclusion is that it's bullish? Are you surprised about that opinion?

• 19:09Ryan Sean Adams?

  I'm not, David. I'm not surprised.

• 19:13Ryan Sean Adams?

  Let's talk about Arbitrum though. So they had a token launch. Was that last week? Token went out to the market?

• 19:19David Hoffman?

  Last week.

• 19:19Ryan Sean Adams?

  Week before?

• 19:19David Hoffman?

  It launched.

• 19:20Ryan Sean Adams?

  That was last week.

• 19:20David Hoffman?

  It was announced two weeks ago. It was launched last week.

• 19:23Ryan Sean Adams?

  Right, right, right. It's all blurring to me. Arbitrum total locked value jumped a nice $2 billion. You can see it in the charts on layer two beat. And there was also some reports of airdrop farming. What is this tweet, David?

• 19:36David Hoffman?

  Yeah. So this is a tweet of what looks like just one device emulating what looks like hundreds of devices. And I can only assume processing transactions on Arbitrum. So this is what a modern day airdrop farm looks like.

• 19:50David Hoffman?

  I'm still yet to see an analysis, a report of the farmed nature of the arb airdrop.

• 19:57Ryan Sean Adams?

  It's like 600,000 addresses and we don't know what percentage of them might be farmed. Hopefully it's low, but you're worried that it might be.

• 20:04David Hoffman?

  I'm sure the efforts of the Arbitrum airdrop like curation, like the criteria pruned away like 90% of, at least 90% of the airdrop farmers' efforts. But like 90%, like they need to have, well, it is what it is. Ideally, they would prune away 100. Pruning away 100 is damn near impossible. How close to 100 did they get is the million dollar question, and I have yet to see an answer to that question. How successful were airdrop farmers? We do not know the answer to that.

• 20:35Ryan Sean Adams?

  Decentralized exchanges seem to be recently successful. This is Hayden Adams tweeting, Dex versus centralized exchange. I don't know what to say.

• 20:44David Hoffman?

  You're not going to say sex?

• 20:45Ryan Sean Adams?

  Dex versus sex volume is at an all time high of 25% since the FTX collapse. Pretty incredible on the back of 2022.

• 20:55David Hoffman?

  New all time high.

• 20:56Ryan Sean Adams?

  Decentralized exchanges are crushing it. This is a tweet about, have you ever wondered, David, how much ETH is just lost forever?

• 21:05David Hoffman?

  I have actually. I actually wonder about that quite a lot.

• 21:08Ryan Sean Adams?

  Okay. Well, this is Connor and he's got the answer for you. Want to read this?

• 21:12David Hoffman?

  Thanks Connor. Connor says, I've categorized thousands of instances of Ethereum typos, user errors and buggy contracts. Thus far, I've found 636,000.

• 21:22David Hoffman?

  Thousand ether, about 1.15 billion dollars that is lost forever. And I'm assuming verifiably lost forever, which is about half a percent of the circulating supply. So

• 21:33Ryan Sean Adams?

  That's a lot.

• 21:34David Hoffman?

  That's not a small amount. That's not a small amount.

• 21:36Ryan Sean Adams?

  And you could see where he came up with some of these numbers, the parity wallet bug alone. That's almost like

• 21:42David Hoffman?

  That sucks.

• 21:43Ryan Sean Adams?

  Yeah, that's almost like 0.5% alone.

• 21:46David Hoffman?

  That's a good piece of Ethereum history lore that I bet you a lot of 2021 crypto people don't know too much about.

• 21:53Ryan Sean Adams?

  Oh, okay. Well, why don't you tell them?

• 21:57David Hoffman?

  Oh, God, it's such a crazy story, man. So there was this library of code. I don't know. This is stretching my developer's like technical ability to tell the story, but like there was this library, code-based library or something, and a junior dev on the parity team was messing around with it and sent this very infamous message to, I think, inside the parity Slack that says something along the lines of, oops, I accidentally killed it. He accidentally deleted the code library or something, which basically froze the multi-sig for parity. Parity was a consensus client that didn't. How did they get all that ether?

• 22:39David Hoffman?

  That wasn't an ICO, was it?

• 22:40Ryan Sean Adams?

  This was the Polkadot raise.

• 22:43David Hoffman?

  Was this the Polkadot raise?

• 22:44Ryan Sean Adams?

  Yeah, my memory of this is this is a Polkadot raise. They basically put it in a, in a wallet, a smart contract, like a multi-sig type early prototype smart contract type wallet. And there was a bug in the wallet.

• 22:55David Hoffman?

  That wasn't the Gnosis safe. It was their own custom-made multi-sig.

• 22:59Ryan Sean Adams?

  Yep. And the bug caused a billion dollars worth of ETH now to be stranded there forever and locked forever. So

• 23:07David Hoffman?

  Yeah, the message is, I think I killed it.

• 23:10Ryan Sean Adams?

  That is terrible, unfortunate, but that means 0.5%, which doesn't even include an ultrasound money chart of ETH is probably locked forever. And it's, that's going to increase over time.

• 23:20David Hoffman?

  That much. Yeah. All right, David, what do we have coming up next? Coming up next, we got the big news of the week. Gary Gensler goes to the principal's office, which I'm sure everyone would love to talk about that. But first, we're going to have to talk about Binance getting busted by the CFTC. And we'll give our takes about that, how serious of a deal that is. ZK EVMs, an oiler update. SBF managed to get in trouble again. So we'll talk about that and more. But first, a moment to talk about some of these fantastic sponsors that make the show possible, especially Kraken, our recommended crypto exchange, because Kraken has been here for 12 years. And I can only assume they're going to be for at least 12 years more, if not the entire rest of crypto, which is why, if you are unsure about your centralized exchange, perhaps you should sign up with Kraken.

• 24:05David Hoffman?

  There's a link in the show notes. Here we go. Kraken has been a leader in the crypto industry for the last 12 years. Dedicated to accelerating the global adoption of crypto, Kraken puts an emphasis on security, transparency, and client support, which is why over 9 million clients have come to love Kraken's products. Whether you're a beginner or a pro, the Kraken UX is simple, intuitive, and frictionless, making the Kraken app a great place for all to get involved and learn about crypto. For those with experience, the redesigned Kraken Pro app and web experience is completely customizable to your trading needs, integrating key trading features into one seamless interface. Kraken has a 24/7 365 client support team that is globally recognized. Kraken support is available wherever, whenever you need them, by phone, chat, or email.

• 24:49David Hoffman?

  And for all of you NFTers out there, the brand new Kraken NFT beta platform gives you the best NFT trading experience possible. Rarity rankings, no gas fees, and the ability to buy an NFT straight with cash. Does your crypto exchange prioritize its customers the way that Kraken does? And if not, sign up with Kraken at kraken.com/bankless. How many total airdrops have you gotten? This last bull market had a ton of them. Did you get them all? Maybe you missed one. So here's what you should do. Go to Earnify and plug in your Ethereum wallet, and Earnify will tell you if you have any unclaimed airdrops that you can get. And it also does PoApps and mintable NFTs. Any kind of money that your wallet can claim, Earnify will tell you about it. And you should probably do it now, because some airdrops expire. And if you sign up for Earnify, they'll email you any

• 25:32David Hoffman?

  Time one of your wallets has a new airdrop for it to make sure that you never lose an airdrop ever again. You can also upgrade to earnify premium to unlock access to airdrops that are beyond the basics and are able to set reminders for more wallets. And for just under $21 a month, it probably pays for itself with just one airdrop. So plug in your wallets at earnify and see what you get. That's E A R N I dot F I. And make sure you never lose another airdrop.

• 25:55Ryan Sean Adams?

  Binance gets busted. David, the CFTC sued Binance over what they say are regulatory violations. This is a press release from the CFTC. What is going on here?

• 26:07David Hoffman?

  Yeah, so the CFTC has filed a civil enforcement action charging CZ and three entities that operate the Binance platform with numerous violations of the Commodity Exchange Act and other CFTC regulations. So this complaint charges that Binance Holdings Limited, Binance Holdings I E Limited, and Binance Services Holdings Limited, together Binance. Man, that's a lot of entities. And that's not all of them. Operate the Binance centralized digital asset trading platform along with number of other corporate vehicles through an intentionally opaque common enterprise with CZ at the helm. As Binance's owner and chief executive officer, the defendants allegedly chose to knowingly disregard applicable provisions of the Commodities Enforcement Act

• 26:52David Hoffman?

  while engaging in a calculated strategy of regulatory arbitrage to their commercial benefit. Okay, let me summarize that. TLDR, CFTC is suing Binance and CZ on allegations that the company knowingly offered unregistered crypto derivatives products inside the United States against federal law.

• 27:10Ryan Sean Adams?

  Like that's a crypto derivative is like a future or something and they didn't get the CFTC's blessing.

• 27:15David Hoffman?

  Exactly. Yeah. Directed US customers to evade compliance controls through VPNs, poorly supervised its business, didn't implement KYC or AML processes, and had also had a poor anti evasion program. And also they never registered as a compliant futures commissions merchant. And so the CFTC in continuing litigation against its defendants, the agency seeks disgorgement, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the CEA and CFTC regulations.

• 27:51Ryan Sean Adams?

  This is interesting, David. This is not a charge of fraud, it seems like. It's basically, it's

• 27:56David Hoffman?

  You didn't follow the rules.

• 27:57Ryan Sean Adams?

  You did not follow the rules. You didn't file the paperwork and register for your derivatives products. And you didn't do the AML KYC stuff that is required by US financial law, the CFTC. This is not like an SBF, you're running a Ponzi scheme, there's, you know, the assets aren't backed type of charge. I don't even think it's the same type of charge that Bitfinex was charged with, which was some of this, but wasn't there also?

• 28:30David Hoffman?

  Bitmax.

• 28:30Ryan Sean Adams?

  Bitmax, excuse me.

• 28:32David Hoffman?

  Well, Bitmax was charged with violating the Bank Secrecy Act, which was a massive deal.

• 28:36Ryan Sean Adams?

  Right. So what does all this mean? What like, what's your take on this?

• 28:41David Hoffman?

  Well, there's, there's some other things in this report as well. So there's a link in the show notes to read the report. There are some pretty damning things. And so here, here's a link. There is a thread of, we are looking at one tweet in a very long thread of a summary of this report. And so I'll read this one tweet to kind of indicate the more egregious side of things of, instead of just like failing to do KYC and registering. So, reading from the report here, internally, Binance officers, employees and agents have acknowledged that the Binance platform has facilitated potentially illegal activities. For example, in February 2019, after receiving information regarding Hamas transactions on Binance, Lim, a Binance executive, explained to a colleague that terrorists usually send small sums as large sums constitute money laundering.

• 29:25David Hoffman?

  So they send small money through Binance because they don't want to send large money because large money triggers the flags. So the colleague replied, you can barely buy an AK-47 with 600 bucks. And with regard to certain Binance customers, including customers from Russia, Lim acknowledged that in a February 2022 chat, the quote is, like, come on, they are here for crime. Binance's MLRO, I don't know what that is, agreed that we see the bad, but we close two eyes. And so like the more direct charge that's being made here is Binance was the host of a very significant amount of money laundering and they just completely were aware of that and just looked the other way, maybe perhaps totally, obviously totally willingly. So that's the more

• 30:10David Hoffman?

  damning charge that's going on here. Yeah. And I also don't think that's any surprise to anyone in the crypto industry. Like I, without any evidence, I totally assume that that's what's going on.

• 30:20Ryan Sean Adams?

  Yeah, it's, it's just interesting. I guess the posture here is, okay, CFTC, understood.

• 30:28Ryan Sean Adams?

  But at the same time, they're going after Binance, they're also going after not the CFTC, but US regulators, they're going after Coinbase. I mean, we just talked about that last week, like shutting down Coinbase staking, Wells noticed to Coinbase from the SEC. And I know that Coinbase is much more thorough, being US located on AML KYC acts. So I, you know, I don't know. I understand it. I understand why the CFTC is doing this. What is Binance's response to this complaint?

• 30:58David Hoffman?

  Yeah. So CZ made a response to the CFTC complaint. So I'll just read the first two sentences here. Today, the CFTC filed an unexpected and disappointing civil complaint despite our working cooperatively with the CFTC for over two years. Upon an initial review, the complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterization of many of the issues alleged in the complaint. Basically, CTC saying like, they're going to fight back. I'll assert again, and I'll say, say without evidence that I, with talking with me and my friends and the chats that we have, like, everyone kind of assumes that CZ and Binance was allowing a bunch of money laundering to process through their exchange. I know a friend,

• 31:42David Hoffman?

  perhaps, that has logged into Binance while, under a VPN, while Binance has not been allowing US customers and was still able to trade under on Binance. That is like an open thing that the industry has been doing, Americans has been doing. We've all known that that's an easy and trivial thing to do. You just use a VPN. I'm just saying, this is what my friend did, would use a VPN and then get in and get out. And like, that's been an open secret that the entire industry has known. So I don't think anyone is surprised that like a bunch of illegal money laundering has been going through Binance. And so the fact that this is happening? It's like no surprise to me, and I think an inevitable conclusion today is the finally the day. And the bull case for this is that Binance pays a fine, they settle with the CFTC,

• 32:27David Hoffman?

  and maybe even gets the green light to, they can argue some of the things like permanent dismantling or whatever, they can, they can fight that in court. But hopefully, this actually starts a conversation which makes Binance perhaps more jurisdictionally friendly with US.

• 32:42Ryan Sean Adams?

  It's very interesting to me because I guess they have, because they have the power to do AML KYC checks, and because they have sort of the, you know, big, big red button to ban someone or to allow them to stop logging in, that they're now responsible for that, which is very interesting. And as a contrast to like a DeFi protocol, right, which has no control over these things. The Uniswap codebase, it has no ability to differentiate the money, the identity, anything else. And I guess if you are, this, this, this also, not only does it sort of push some of these centralized platforms to button up, which is what you were saying, pay the fee and then button up, I think that's probably the

• 33:27Ryan Sean Adams?

  the hopeful outcome that Binance would have. It also pushes things more towards decentralized protocols, where no one has the ability to do the AML KYC, ban someone, you know, push the button, where it's kind of completely open. And, you know, the CFTC can't go, I guess maybe they can try to sanction code next, right? Which is where they, what they did with trying to cash.

• 33:47David Hoffman?

  Yeah.

• 33:48Ryan Sean Adams?

  But that's another fight.

• 33:49David Hoffman?

  The CFTC didn't try, but the powers that be did, yeah.

• 33:52Ryan Sean Adams?

  Interesting stuff, interesting stuff. Okay.

• 33:55David Hoffman?

  Two more bits of news on this thread, is that in the lawsuit, the CFTC versus Binance holding clearly states that Bitcoin, Ether, and Litecoin are all commodities. The implication of this is that perhaps on an alternative world, the SEC might have sued someone else saying that these things were securities. But the CFTC is saying they're commodities, which is like, this is a proxy war between the CFTC and the SEC.

• 34:17Ryan Sean Adams?

  They just snuck that in there.

• 34:18David Hoffman?

  Yeah, right, yeah.

• 34:19Ryan Sean Adams?

  You think Gary Gensler read that and was like, just pissed off?

• 34:21David Hoffman?

  I'm sure he read it on Twitter, yeah, and his mentions, yeah.

• 34:25Ryan Sean Adams?

  David, the war on crypto seems like it is continuing. There was an economic report from the president that came out last week. They had an entire chapter, this is like 90 pages, called "Digital Assets: Relearning Economic Principles." It's kind of like, oh, the kids are learning.

• 34:44David Hoffman?

  Do you mean speedrunning the world of money and finance?

• 34:45Ryan Sean Adams?

  No, no, no. "Relearning Economic Principles" is what it was called. There was, you know, I read parts of this, not the entire thing, but like, it felt like 90 pages of just FUD, being like, okay, so let me offer you an example quote.

• 35:01David Hoffman?

  You didn't read this, did you?

• 35:02Ryan Sean Adams?

  I skimmed it. "To date, cryptocurrencies don't offer any fundamental value, nor are they a better alternative to fiat money or more effective payment system. Instead, their innovation has been mostly about creating artificial scarcity in order to support crypto assets' prices." And of course, the conclusion, David, the report continues, "is that the nation's financial infrastructure has the potential to offer these same benefits." They're basically like, yeah, that crypto thing is a scam, Ponzi's, get rich quick. And what people should be using is our central bank digital currency, our existing financial system. There is no need for cryptocurrency.

• 35:43Ryan Sean Adams?

  It's just a bunch of grifters and scammers. And the real solution that they're looking for is, of course, the Fedcoin, the central bank digital currency. That is the conclusion of this report.

• 35:53David Hoffman?

  Hey, man, water's wet, skies blue, you and I are bullish ether, and the United States wants you to use the dollar. Like, this is just what it is.

• 36:02Ryan Sean Adams?

  Look, is it the United States? It's definitely the White House right now. I will say that. Maybe there are other factions of government that kind of see this.

• 36:11David Hoffman?

  The powers that be in the United States, yeah.

• 36:12Ryan Sean Adams?

  This is Fred Arisom. 15%, he says, of the annual White House report is devoted to crypto FUD.

• 36:20Ryan Sean Adams?

  I have a question for you, though.

• 36:21David Hoffman?

  It's admirable that you even skimmed this thing.

• 36:24Ryan Sean Adams?

  I have a question for you, though, David, which is something that's been on my mind lately. The last, you know, two to three weeks as sort of the anti crypto and the pro crypto sides. Some of that argumentation has reached maybe a fever pitch, at least a local high. Do you think the US will ever make it illegal to own cryptocurrency? Like, flat out ban. You, as a citizen, you must turn in your crypto. Kind of executive order 6102. You remember that, where FDR banned gold? Basically, you had to sell it back to the government. An individual American citizen could not own more than some amount of gold.

• 37:05Ryan Sean Adams?

  You know, basically melt down your jewelry, melt down your gold and sell it back to the feds. That's what actually happened in the early 1930s. And by the way, that law was in existence for like 40 years. Didn't get that reversed until like the 1970s. Do you think that could happen with crypto?

• 37:23David Hoffman?

  No, absolutely not.

• 37:24Ryan Sean Adams?

  Why do you not think that?

• 37:26David Hoffman?

  Because we have a court of law. We will sue them.

• 37:30Ryan Sean Adams?

  It did happen in the United States in the 1930s. And there was a court, there were courts of law. It's not like the 1930s didn't have courts of laws.

• 37:37David Hoffman?

  No.

• 37:38Ryan Sean Adams?

  Executive order.

• 37:39David Hoffman?

  We're in a different society now.

• 37:42Ryan Sean Adams?

  I.

• 37:43David Hoffman?

  I happen to be outside of the United States. And if that law ever got passed, I would not be coming back.

• 37:49Ryan Sean Adams?

  Um, yeah, well, that's, that, you know, that's interesting. I haven't read much up on the, kind of the 1930s. If similar gold hoarders made that choice. And by the way, that's what they were called, gold hoarders. This is sort of the vitriol, which is basically like, you must hate, you're not a patriot. You're just hoarding, you're greedy.

• 38:09David Hoffman?

  You're defecting from the coordination. This is a public good. We need to all maintain our fiat currencies, right?

• 38:15Ryan Sean Adams?

  Exactly. Very, very anti, anti kind of capitalist, anti sort of like, do it for the public, do it for the, the social good. I guess what I'm seeing, David, is similar narrative sentiments starting. You know, like Ben's Hunt pushed back against biology where he's like. You know, you're causing a bank run, Balaji, by even saying this. And Balaji's saying, I'm just telling people to get to the lifeboats. Are you, are you against lifeboats? If, if the ship isn't sinking, you have nothing to worry about, Ben. And Ben is pointing at Balaji and saying, you're causing this.

• 38:48David Hoffman?

  Right.

• 38:48Ryan Sean Adams?

  What about kind of the social good of keeping this system intact? What, we lose all of these things if everyone flees to the life raft. I'm seeing the seeds of this, this kind of idea of like crypto hoarders, crypto bros. I'm seeing it. So I don't know why you're so convinced this couldn't happen in the United States. I totally think it could. I put a poll out, by the way, and I asked the question, will the US ever make it legal to own cryptocurrency? Followers on Twitter said, no, 60%.

• 39:16David Hoffman?

  Yeah, this is surprisingly close.

• 39:19Ryan Sean Adams?

  Forty to 60%. I just don't know why you think it's not possible, but you're just saying that society has progressed.

• 39:24David Hoffman?

  I mean, it's certainly possible, but yes, it's a progression of society. It's a progression of technology. Things were more extreme back then. Like, that was an extreme time in people's lives, like pre-internet times. Dude, we had like Nazism. That was an extreme time, right?

• 39:42Ryan Sean Adams?

  Don't you think we are entering some pretty extreme, not, not quite 1920s, 1930s level, like late 1920s? But like, things have gotten a lot more extreme than like when I grew up in the 90s.

• 39:55David Hoffman?

  I think we've, I think we've adapted as a society. I think the, the internet allows information to spread. It allows us to learn from history faster. Like, I don't think it would be possible for us, I'm, I'm reading a bit of history lately. I don't think it would be possible for us to have, um, uh, like the, the 60 million deaths as a result of just like a mind virus of communism in Soviet Russia. Because if we had the internet, I don't think that that would have been possible. Uh, I don't think that we would have, I think when there's just imperfect information and just the way that the society worked back in those days, I think extreme circumstances were, were allowed to rise much more than in today's world.

• 40:39Ryan Sean Adams?

  Really?

• 40:40David Hoffman?

  I think so.

• 40:40Ryan Sean Adams?

  I totally. I totally think this is possible, this whole scenario. I totally think 60 million, 100 million deaths could happen in the, you know, in the, in the 21st century. But that aside, let's talk about this specifically, which is the US could make it illegal to own cryptocurrency. I think the first step towards that wouldn't be just a flat out ban. It would be basically a choking off of fiat to crypto exchanges. There's other ways to do this. Yeah. We're already seeing a little bit of that, David. Like, we are one step down that path. And the next step would be like, sure, you can buy crypto on an exchange or an ETF, but you can't withdraw to your, um, like, just take Coinbase, take Kraken. No more withdrawals to non custodial laws. That seems much more plausible to me.

• 41:21Ryan Sean Adams?

  Well, and then, and then it's basically, and then after that, the next step would be, if we ever get to this step, would be, and by the way, a bunch of crypto bro hoarders, turn in your cryptocurrency. Yeah, make it, make it the legal version. Yeah, for sale. You have to exchange it for this ETF version of it. I'm, I'm not, look, I still sign like- That seems slightly more plausible. I can see this. I still think like this is 10% probability, but like, if shit hits the fan. Yeah. I'm saying if, if- It depends on how the exchange things go. If central banks are actually threatened, right, as they were in the 1930s, like, kind of, and, and then they, you know, politicians and society sort of rallies around,

• 42:01Ryan Sean Adams?

  yeah, we have to be in this together. It's like war times, it's bad times. You can't, you can't leave on the lifeboat, right? Things get worse if everyone leaves on the, on the lifeboat. I could see it happening, but maybe I'm being pessimistic here. Anyway, I wanted to have that conversation with you. I'm glad we had that. Yeah, no, I didn't know that I had to think about that, but now I do.

• 42:24Ryan Sean Adams?

  Let's take this to the courts. Crypto also has defenders, even outside of crypto. So David, you said one of our recourses is the court system. Certainly, the United States does have a court system. And this is a white paper courtesy of Cooper and Kirk, which is a law firm that is actually, they've, they've previously sued the FDIC and the OCC and the Fed over Operation Choke Point 1.0, which was the choking off of certain industries like marijuana industry from the banking system. And now they are alleging in this white paper that the US government is doing the same thing to crypto. What's the summary of this, uh, report?

• 43:01David Hoffman?

  Yeah, they sent a letter to US Congress regarding the clandestine financial war against the cryptocurrency industry urging Congress to hold agencies accountable and propose questions and steps to obtain answers. They are claiming that regulators are using regulatory tools and pressure tactics to prevent crypto integration to the financial system and that it's up to Congress to hold federal banking regulators accountable. Now, Ryan, I was not here during the time in which gold was made illegal, but I would imagine, maybe there was stuff like this, maybe I'm being naive, but this is an example of like the pushback that comes very early and very hard by a very engaged community that perhaps I don't think we had way back then. And so this isn't any action, this is just a letter that is

• 43:44David Hoffman?

  drafted by a law firm, but you know, it is allowing the world, the people of the United States to have a foundation to stand on to air their grievances.

• 43:56Ryan Sean Adams?

  Yep, it's basically executive branches is kind of forcing this and we have two places we can go to fight it judicial, which is the court system, which is what they're attempting to do. And they're also calling on Congress to push back against it. Speaking of Congress, Gary Gensler, he's got to go in front of Congress? Is that what's happening?

• 44:13David Hoffman?

  Yeah, Gary Gensler to face Congress grilling over crypto policy is the headline. So Gary Gensler is going to testify before, testify, Gary Gensler is going to testify.

• 44:23Ryan Sean Adams?

  You sound giddy.

• 44:25David Hoffman?

  Before the House Financial Services Committee, its chairman, Patrick McHenry, has confirmed that this is going to happen. This is going to happen on April 18th and he will face questions over his approach towards the crypto ecosystem. Gary is going into the hot seat. I'm sure he's going to prep for this. There's no way that he isn't like cognizant and intentional about his strategy towards the crypto world. So I'm sure he's going to come with a pre-prepared list of deflections saying something like he's already said, like, I just, I just look towards the Supreme Court for guidance. I apply the rules of the securities laws that have been established before me. I'm sure he's just gonna do-

• 45:06Ryan Sean Adams?

  Do you want to take a shot every time he says howie test?

• 45:09David Hoffman?

  Yeah. Oh, I mean, I don't want to die, but but that's a fun game.

• 45:16Ryan Sean Adams?

  This is a this is kind of interesting because I have observed this too. There does seem to be increased partisanship over crypto. I would not have said this two years ago that, you know, one one party was more pro crypto than the other. It seemed sort of about even and both were kind of like almost neutral on it. But that has started to change. What is this tweet that we've pulled up here?

• 45:36David Hoffman?

  Yeah, this is a tweet from Dennis Porter, who is a Bitcoiner that we've actually had on Bitcoin before. And he tweets out, "Pro crypto and pro Bitcoin Democrats are lining up to voice their opposition to their own party's stance. Democrats are on the verge of driving away their own voters and losing support from this important new voter bloc. In my opinion, it could cost Democrats a 2024 election." And then there are screenshots of four crypto Twitter personas who are saying that they are perhaps reconsidering their previous Democratic base in support of the Republican Party, if indeed, the Republican candidate was sufficiently pro crypto, and I'm sure other facts and circumstances as well.

• 46:16Ryan Sean Adams?

  This is someone saying, "I have never once voted for a Republican president," but is considering this. This is also Chris Berninski, whom we quoted earlier. "Crypto is going to be an issue for voters in 2024, and already that is a sign of us winning. But I have also never seen the US government be so draconian. In fact, so long as it's not Trump, it may cause me to vote Republican for the first time in my life." This is very interesting. I know you have a way in on this too.

• 46:43David Hoffman?

  I am screenshotted here. Yeah.

• 46:45Ryan Sean Adams?

  Okay, what's what's your take on this?

• 46:47David Hoffman?

  Yeah, so I am one of the four people that are that is being screenshotted and tweeted out by Dennis. And I said, "My entire family is Democrat. I was once considered myself a Democrat, and now I kind of consider myself just politically agnostic."

• 47:01Ryan Sean Adams?

  Great party?

• 47:02David Hoffman?

  Great, great party. Yeah, that's a great way to put it. I was once a Bernie bro because F Hillary, so I'm putting my political opinions out here. Sorry for that. I too would vote Republican for the first time, given that it is the correct pro crypto candidate. And also, the Dems continued on the anti crypto warpath. Since I'm here grandstanding about my political opinions, I also followed up this tweet with another tweet saying, "And that Republican would also have to be pro-choice." That's how I what I believe. And so like, for me, my personal political beliefs are that I'll vote, I'm almost a single issue voter for crypto. So long as that candidate is not an insane person, I will vote for the pro crypto candidate.

• 47:46Ryan Sean Adams?

  It's definitely, it's definitely making you question, right? Previous political beliefs over of this one thing and it could start to cost the Democrats. Is that a popular position in your family, David?

• 47:56David Hoffman?

  No, it is not. So, so actually, so growing back to Chris Bernisky's tweet, I shared Chris Bernisky's tweet with my, in my family chat. And, cause my entire family is like pretty thumbs up about Elizabeth Warren. And I just said, hey, guys, like my entire industry thinks that Elizabeth Warren is super cringe and not treating us with respect. And is actually doing the whole emperor's wearing no clothes thing because the way she talks about our industry is coming from a place of completely just misunderstanding and being uninformed about things. And it's making our entire industry not just question her stance and information about crypto, but basically her stance and information about any other industry.

• 48:39David Hoffman?

  It's kind of like when you, when you understand how the mainstream media reports on crypto and you're like, well, they just got that wrong. And, and so are, is that how they report about everything? Because they're getting crypto wrong. And so what about everything else?

• 48:51Ryan Sean Adams?

  I think that's true, although I will say one thing is, is just, I think people are inherently skeptical of like industry bias, right?

• 48:59David Hoffman?

  Sure.

• 48:59Ryan Sean Adams?

  There's like big pharma, there's, you know, the, you know, the gun lobby, all of these things and big banking and big crypto. That could be a thing. Crypto is not big crypto, but like crypto bros, that sort of thing. To me, this is less about an industry fighting for like its ability to exist and survive, although that's part of it. To me, this goes far deeper than that. This is like a basic, like American civil liberty to own a freaking digital property.

• 49:25David Hoffman?

  Right.

• 49:26Ryan Sean Adams?

  Like this is, this, this is a bipartisan issue.

• 49:27David Hoffman?

  Something that embodies American values.

• 49:31Ryan Sean Adams?

  This is deep the level of like constitutional, like this is freedom of speech. This is digital civil liberties. And, and to me, this is not a about like one kind of party helping and getting donations from crypto or not, or getting crypto. This is just like, why can't we all rally around this being like core to a Western, classically liberal democracy that embodies human values and translates that for the digital age? That's what crypto is to me. I don't know if that's an effective argument on anyone in your family, but that's certainly what I believe. And this is also increasingly what I think some, some politicians are giving voice to. So we had Tom Emmer on the podcast earlier this week, David.

• 50:15Ryan Sean Adams?

  And I know like you were on at the beginning, you had some internet connectivity and then you were not able to finish it.

• 50:20David Hoffman?

  Fully established here in, in Montenegro.

• 50:22Ryan Sean Adams?

  Dude, you should see how fired up he was.

• 50:25David Hoffman?

  I'm looking at the thumbnail, man.

• 50:27Ryan Sean Adams?

  I, is this a thumbnail from the, yes, that I think I saw that face during, he is so fired up and we talked to him a year ago. So we talked to Tom Emmer a year ago and he's pro crypto and this, this time it was a different Tom Emmer, different politician. He clearly thinks that crypto is going to, I don't know his motivation, but assume he's just kind of a politician going with the votes and that, that sort of thing. He clearly thinks that this is a cornerstone of his platform. And I think, David, because he is the whip in the house, that is number two, most powerful seat in House of Representatives. I think this could become a platform for Republicans in 2024.

• 51:06David Hoffman?

  Cause the Democrats are letting them have it. For the Republicans, it's like, this is free real estate.

• 51:11Ryan Sean Adams?

  Basically, and somebody's gotta go get that cohort of votes. And we have got a two-party system, so it's going to be either one party, the other. And by the way, the more one party embraces it, the more the other party has to be like, we're not those guys.

• 51:22David Hoffman?

  Right.

• 51:23Ryan Sean Adams?

  So that's just how this works.

• 51:24David Hoffman?

  They stand for that? We don't stand for that.

• 51:28Ryan Sean Adams?

  So anyway, I don't know how it's all gonna unfold. It's really at its courts. It should be a bipartisan, just American issue, but it does seem like the Republicans are kind of making this part of their platform. We'll see how that carries in 2024.

• 51:40David Hoffman?

  Right. So when I was arguing with my sister, it is perhaps the leader of my family in the pro-Warren side of things. And she was like, "Yeah, you crypto bros, like you think you don't need regulation? Like, look what happened to crypto in the last year." I'm like, "Are you serious? We are begging for regulation." And this is what, this is the, you're just touting what Elizabeth Warren is saying. Like, she's trying to position us as these like rogue, shadowy super coders who don't want any regulation. And my response to her is like, "No, you're doing the same thing that she is, which is misunderstanding and misrepresenting our industry and casting us off as like these barbarians, crypto, like gunslingers. Please regulate us. Please."

• 52:24Ryan Sean Adams?

  You're gonna get clipped by this, by the way. Somebody's gonna clip that, "Please regulate us." David Hoffman, you're saying, clarify before you get clipped on what you're actually saying. So-

• 52:34David Hoffman?

  If you can be regulated, if you are a centralized entity, if you are a bank, if you have, if you have, if somebody deposits trust into you, you are in need of regulation. If you are a decentralized protocol that is permissionless and/or also aspires to be permissionless and you need a path to become permissionless. I mean, regulation isn't just like clamping down the gates. It's also providing clarity and paths forward for crypto protocols to mature.

• 53:02Ryan Sean Adams?

  Paths forward. Absolutely. Yeah. So, internet, get the full clip, all right? Don't just, don't just clip David saying, "Please regulate us."

• 53:11David Hoffman?

  Crypto bro, like screaming, bleeding from his eyeballs, wants regulation.

• 53:16Ryan Sean Adams?

  Crying.

• 53:17David Hoffman?

  Crying. Yeah, right.

• 53:20Ryan Sean Adams?

  Well, you know what? Gary Gensler, you'll be happy to know, says, "David, the rules are already clear." This is SEC's Gensler insisting, "Clear rules for the crypto market already exist." But the regulator says the digital asset industry is rife with non-compliance. You already have all of the rules in front of you. It's perfect clarity. I've already explained this to you in office hours with Gary. Your problem is you're just non-compliant." That's what Gary says. I can't wait to get-

• 53:47David Hoffman?

  Thanks, Gary. Thanks, Gary. I'm looking forward for you testifying, by the way.

• 53:53Ryan Sean Adams?

  In front of Emmer, too. What's Emmer gonna do? Get him, Tom. Okay. This is going on in the meanwhile, David. This is just a contrast point. Maybe we'll end this section here. The freest country in the world, AKA what America purports to be is choking off crypto while Hong Kong is opening the floodgates. Did you see this? I am including a Bloomberg article, "Hong Kong Regulators Doze Meetup to Help Crypto Firms With Banking." How you're just talking about like politicians filling the vacuum? Free real estate, free space here is exactly what Hong Kong is doing. Coming out of Hong Kong, can you believe this? Being like, okay, if New York City, the US government, doesn't want to be part of this crypto

• 54:33Ryan Sean Adams?

  revolution, doesn't want to be sort of a nexus for finance in this world, then we will be. And I think it's straight embarrassing for the United States. And this is the take that Tom Emmer had, which I, which I share. Is America just going to build its future on debt? Are we actually going to build something again? That's the question. And crypto is like a new generation of the internet. It's an invitation to go build things here. And what we're doing with these policies and all of the marvelous clarity Gary Gensler is giving us is driving builders offshore, outside of the United States. You are not welcome here, crypto entrepreneur. And if we keep doing that, it's not going to be good for the United States. Crypto will be fine. It's just not going to be good for the US. Maybe we'll end it there. What do we got coming up next?

• 55:18David Hoffman?

  Oh, boy, that was a wild man. Okay, coming up next, two more D K EVMs land on the Ethereum mainnet. We got some good news out of Euler. Maker Dow has a new path for DAI. SBF gets in trouble, amazingly. The guy just can't get, can't stop, can't stop him. And then AI training, we're talking about AI now, is getting called for a timeout. So all of this and more, as soon as we talk to some of these fantastic sponsors that make this show possible. Uniswap is the largest on-chain marketplace for self-custody digital assets. Uniswap is, of course, a decentralized exchange, but you know this because you've been listening to Bankless. But did you know that the Uniswap web app has a shiny new fiat on-ramp?

• 55:59David Hoffman?

  Now you could go directly from fiat in your bank to tokens in DeFi inside of Uniswap. Not only that, but Polygon, Arbitrum, and Optimism Layer 2s are supported right out of the gate. But that's just DeFi. Uniswap is also an NFT aggregator, letting you find more listings for the best prices across the NFT world. With Uniswap, you can sweep floors on multiple NFTs and Uniswap's universal router will optimize your gas fees for you. Uniswap is making it as easy as possible to go from bank account to bankless assets across Ethereum, and we couldn't be more thankful for having them as a sponsor. So, go to app.uniswap.org today to buy, sell, or swap tokens and NFTs. The Phantom Wallet is coming to Ethereum.

• 56:44David Hoffman?

  The number one wallet on Solana is bringing its millions of users and beloved UX to Ethereum and Polygon. If you haven't used Phantom before, you've been missing out. Phantom was one of the first wallets to pioneer Solana staking inside the wallet and will be offering similar staking features for Ethereum and Polygon. But that's just staking. Phantom is also the best home for your NFTs. Phantom has a complete set of features to optimize your NFT experience: pin your favorites, hide your uglies, burn the spam, and also manage your NFT sale listings from inside the wallet. Phantom is, of course, a multi-chain wallet, but it makes chain management easy, displaying your transactions in a human-readable format with automatic warnings for malicious transactions or phishing websites. Phantom has already saved over 20,000 users from getting scammed or hacked.

• 57:27David Hoffman?

  So, get on the Phantom waitlist and be one of the first to access the multi-chain beta. There's a link in the show notes, or you can go to phantom.app/waitlist to get access in late February.

• 57:38Ryan Sean Adams?

  David, this week, the second ZK EVM just launched, so we doubled ZK EVMs in two weeks. This is Polygon's ZK EVM. Tell us about it.

• 57:48David Hoffman?

  So yeah, Polygon's ZK EVM, long awaited, just shipped to mainnet. Ryan John Adams, my co-host here, had a fantastic show with Jordi Belina and Mihalo from Polygon. Jordi, fun fact, previously, I actually love this story, because I was on, it was me. This is going to be a deep cut of a story. It was me, Mariano Conti, and Mihalo in ETH CC 2021. I had just come off out of my scooter accident, if you remember that.

• 58:16Ryan Sean Adams?

  Oh, black eye and everything?

• 58:17David Hoffman?

  Yeah.

• 58:17Ryan Sean Adams?

  Oh, teeth?

• 58:18David Hoffman?

  Yeah. No, no, just a black eye. I didn't lose anything. Yeah, no, just a black eye.

• 58:22Ryan Sean Adams?

  Didn't you get chipped a tooth or something? You went to the dentist?

• 58:24David Hoffman?

  Yeah, I chipped a tiny little tooth and it came back, yeah. It grew back, yeah.

• 58:28Ryan Sean Adams?

  It came back, wow.

• 58:31David Hoffman?

  Anyways, so fast forward like four weeks into ECC, I still had a little, you know, a little bit of puffiness. Anyways, it was me, Mariano Conti, the guy that deployed multi-cladderal die and maker in like 2019. We were all just getting a beer towards the end of ECC, and Mihalo gets a phone call. He looks at it, steps immediately up and goes and answers it, and me and Mariano just continue having a beer. And then Mihalo comes back with an overjoyed, like, facial expression. And we were like, dude, what was that? And he was like, dope, good news, man, good news. I can't tell you.

• 59:05Ryan Sean Adams?

  It was this?

• 59:06David Hoffman?

  It was this. It was the Polygon acquisition of ZK Hermes, of Hermes, which was Jordi Belina's project, which is the man that you see on the screen to the left. And fast forward to where we are today, this is the culmination of that phone call, of that partnership agreement. And now we have the ZK EVM live on mainnet. And so that was what was launched. When was that launched? On Tuesday? Tuesday of this week?

• 59:29Ryan Sean Adams?

  Yeah, on Tuesday. ETH as the gas token, Matic as the payment to validators. We've got a full interview if you want to check that out. And the cool thing is how fast and furious these ZK EVMs are now coming. I feel like this is crypto's broadband moment. This is Ethereum's broadband moment, at least. David, we just got our second, but here's ConsenSys coming out and introducing a third?

• 59:52David Hoffman?

  Man, they're multiplying!

• 59:53Ryan Sean Adams?

  Okay, Lina it's called, a developer-ready ZK rollup powered by ConsenSys. I haven't investigated this, but... They're just coming out of the woodwork now. We got ZK EVM suddenly. It's March 2023 and we got block space that is gonna get real cheap.

• 1:00:10David Hoffman?

  We got full 90 on block space.

• 1:00:11Ryan Sean Adams?

  You want block space? We got block space.

• 1:00:13David Hoffman?

  We're ether is selling block space. Oh my gosh.

• 1:00:16Ryan Sean Adams?

  Speaking of block space, uh, layer two beat. All right. I, I love layer two beat.

• 1:00:22David Hoffman?

  Love layer two beat.

• 1:00:23Ryan Sean Adams?

  Because they provide transparency to all of these rollups that are coming to the market. And as we multiply our chains, it's hard to know what the, what the decentralization and security guarantees are on each of these chains. Did you see this? They added this, um, little kind of pie chart. Uh, what are we looking at here?

• 1:00:39David Hoffman?

  Yeah. So this is a five, there's a, think of this like an orange slice for the podcast listeners. So, uh, an orange slice with five slices and each of these slices can be various colors, uh, gray, yellow, red, and I'm assuming, I'm assuming green, maybe actually.

• 1:00:55Ryan Sean Adams?

  We don't see any green yet because nothing's green yet.

• 1:00:58David Hoffman?

  I actually don't know if green is possible. Is green possible?

• 1:01:00Ryan Sean Adams?

  This is an orange slice of, um, what? The risks.

• 1:01:03David Hoffman?

  Security risks. Yeah. So there's five different like things that all rollups need to be secure on. Data availability, uh, where is the data stored? Uh, and can that data be rugged? Upgradeability, uh, validator failure, sequencer failure and state validation. All rollups need to improve on this, on all five of these things. And so this pie chart that you can see, um, I actually am still confused as to whether or not, uh, sorry, there are only three colors. Uh, there are, is gray, yellow and red and.

• 1:01:32Ryan Sean Adams?

  Ah, okay.

• 1:01:33David Hoffman?

  Man, they should really make gray, green. Uh, gray is green. Intuitively gray is green. Green doesn't exist, but gray, gray is, gray is good. Yeah. So there's gray, uh, yellow and red. Uh, and so you can see the characterization, uh, a snapshot of what the security risks for every single layer two are and what they have to work on.

• 1:01:52Ryan Sean Adams?

  All right. Basically you, you want your orange slices. You, you want the whole thing, the whole circle to be all gray.

• 1:01:56David Hoffman?

  Gray. Gray. Can we please, Bartek? Come on. Can we get this thing green?

• 1:02:01Ryan Sean Adams?

  We, and the closest is Arbitrum one, which has.

• 1:02:05David Hoffman?

  Two orange slices out of five.

• 1:02:07Ryan Sean Adams?

  And it's, yes. You just said orange slices, but there's no orange color. Okay. David's actually talking about the orange, not yellow. I'm, I'm worried that people will, will see like color orange. We totally screwed this up, but we are not editing this out. All right? This is raw, unfiltered, bankless material.

• 1:02:24David Hoffman?

  Two of the orange slices are orange.

• 1:02:28Ryan Sean Adams?

  All we're trying to say is go to layer2beat.com if you want to check in on the risks associated with your Layer 2. That's probably all we need to freaking say. Next topic. Get it out of here. Euler, good news. David Euler, the Exploiter, returned 51,000 ETH. 51,000 ETH, 51K ETH.

• 1:02:49David Hoffman?

  And actually, even more than that, because there was another transaction that returned another 7,000 Ether. There was also another transaction that I've returned something like 20 million DAI.

• 1:02:59Ryan Sean Adams?

  They got 84% of their funds back.

• 1:03:01David Hoffman?

  84% of Euler exploited funds are returned. That is, if you had told me that we were going to get 84% of funds back the day it was exploited, I was like, wow, that is unheard of.

• 1:03:11Ryan Sean Adams?

  That's pretty good. Let me ask you here. What are these criminals doing? I wasn't following the story. So like, you go, you hack something, you hack like 150 million dollars, and then you go and a week later, two weeks later, you return 84% of it? Who does this? Like, what is happening here?

• 1:03:29David Hoffman?

  So there's two routes. So understanding that, my first take on the first exploit was like, man, this is totally North Korea, because they immediately went into tornado cash, implying that they had no intent on returning the funds. So follow up on this story, and I'll give my take after this, is in a series of messages written into the data of transactions on the Ethereum blockchain, the Exploiter says this, "Jacob here, I don't think what I will say will help me in any way, but I still want to say it. I fucked up. I didn't want to, but I messed up with others' monies, others' jobs, and others' lives. I really fucked up. I'm sorry. I didn't mean all that. I really didn't fucking mean all of that. Forgive me."

• 1:04:11David Hoffman?

  And then in another transaction, he says, Jacob, apparently, "The rest of the money will be returned ASAP. I only look after my safety, and that is the reason for the delay. I'm sorry for any misunderstanding." Implying, if we're taking this, if we're taking Jacob seriously, that we are going to be getting 100% back of Euler exploited funds.

• 1:04:31Ryan Sean Adams?

  What? What is this?

• 1:04:32David Hoffman?

  So either two things, one of two things happened, maybe both. One, law enforcement found him. And said, hey, man, you are going to jail. If you don't return the funds right now, you're going to go to jail for like a big time. If you return the funds only right now, you will only be go to jail for a little bit, something like this, something along these lines.

• 1:04:50Ryan Sean Adams?

  That's how it works. Yeah.

• 1:04:51David Hoffman?

  That's how it works. It's directionally correct. The other one is like, he actually felt bad about all of the lives that he damaged. And so he returned it out of guilt. But then he also said.

• 1:05:00Ryan Sean Adams?

  I'm gonna go with option A there, David.

• 1:05:02David Hoffman?

  I'm gonna go with option A because he, I mean, assuming Jacob's his actual name, he was like, yo, the gig is up. You guys got me. Here's all the money back. And it's also me doing this.

• 1:05:12Ryan Sean Adams?

  I'm sorry. Here's your money back.

• 1:05:14David Hoffman?

  I'm sorry.

• 1:05:15Ryan Sean Adams?

  I say crypto, like worst robbers in history. Imagine going like, you know, stealing something from a bank and then like returning a week later to me like, hey, guys, I'm sorry. I met, I was going through a rough patch.

• 1:05:26David Hoffman?

  Yeah.

• 1:05:27Ryan Sean Adams?

  Here's the money back.

• 1:05:28David Hoffman?

  Think of the consequences.

• 1:05:29Ryan Sean Adams?

  I really didn't think about it. I'm sorry. So strange. Well, such is crypto and these negotiations happen on Jay. Maker, what's a new era has begun. Chapter zero. What are we looking at here?

• 1:05:43David Hoffman?

  We are looking at a promotional graphic. If you turn on the sound, it doesn't say anything. It is just music. So I actually was trying to get the details of what this announcement means. And I didn't, there wasn't too much there. I went into the governance forums. I opened up the links. I looked at what was being proposed. Man, it's make a really bureaucratic. And so they are tweeting out chapters zero, a new era has begun. A governance proposal has passed that ratifies a new constitution, which includes for Maker Dow to one, increasingly decentralized the collateral that backs die. And I think the big obvious low hanging fruit here is removing dependence on USDC, but perhaps also for real world assets.

• 1:06:28David Hoffman?

  Second, allowing die to free float relative to the dollar. This was an original idea from Maker Dow that has kind of been pushed to the back burner for a very long time now, but now is returning. Questionable. Also questionable is the timeline on this. I don't know how like is that this year or are we just saying that we still want to do this? I don't know. And also improvements to the actual governance process of MakerDAO. And they also said that they are going to limit real world asset collateral. These are the notes that I have from Christie. Thank you, Christie, who did more research than me. But man is finding out what this actual announcement is actually really confusing. If someone can summarize this for me, that'd be really appreciated.

• 1:07:05Ryan Sean Adams?

  My high level take on it was they want to go less in the direction of real world assets and more in the direction of crypto native assets because the real world is looking a little anti crypto these days. But maybe that's not what they did. Ticketmaster is doing NFT stuff.

• 1:07:21David Hoffman?

  This is cool.

• 1:07:22Ryan Sean Adams?

  Okay, but I thought Ticketmaster was the villain since they jacked up those Taylor Swift concerts. And you know, I resent them being associated with crypto, but you're telling me this is a good thing.

• 1:07:32David Hoffman?

  If you accept it at face value, which maybe I'm overly optimistic and bullish on humanity, but I will. Ticketmaster has launched the ability for artists to offer token gated ticket sales, meaning that a sale can only be unlocked or accessed with a specific NFT. They've launched, they've launched a token gated option for special access to concerts and event tickets for eligible NFT holders. And they also have a suite of artist driven tools, offering many unique ticketing services, including face value ticket exchange, a program that limits transfer and locks in resale prices at face value. I don't know if that is done by a smart contract, but in theory it could. Verified Fan, a registration system that filters out scalpers and bots, user and and bot users who are looking to acquire

• 1:08:16David Hoffman?

  tickets for the purpose of reselling. And Ticketmaster Requests, a service that eliminates the traditional on sale rush by allowing artists who sell tickets to high demand shows through a fulfillment and request model. During the purchasing process, Ticketmaster prompts a user to connect a wallet to verify ownership of an NFT. After that, it's the same buying process. So token gated access to buying some NFTs along with some other equitable tools and services that in theory could all be smart contracts, but it wasn't stated whether they are or not.

• 1:08:48David Hoffman?

  Of Ticketmaster?

• 1:08:50Ryan Sean Adams?

  I wouldn't go that far, David, but look, this is a pretty big deal, actually. Ticketmaster is absolutely massive. These tokens are minted on Ethereum and accessible via MetaMask and Coinbase. This is onboarding more people to kind of NFTs. I think in any other like, you know, news cycle or week, or like in a world where Ticketmaster was less hated at this specific moment of time, we probably would have led the episode with this. Like, this is actually

• 1:09:15David Hoffman?

  Yeah.

• 1:09:15Ryan Sean Adams?

  huge news in terms of the thing that we care most about, which is like onboarding the world to crypto and Web3.

• 1:09:24Ryan Sean Adams?

  Pretty big.

• 1:09:25David Hoffman?

  I think it's fair to be skeptical about Ticketmaster just by nature of what there are and their incentives.

• 1:09:30Ryan Sean Adams?

  Sure.

• 1:09:30David Hoffman?

  And also, at the same time, it's also fair to accept that this, maybe it's on Ticketmaster, but is coming. Like, verifiable tickets as tokens on Ethereum by someone, somewhere. I bet you Gary thinks these are securities.

• 1:09:45Ryan Sean Adams?

  Oh, God, do you want to ask him? Yeah, come on the podcast, Gary, we'll ask you.

• 1:09:49David Hoffman?

  Bear bear.

• 1:09:49Ryan Sean Adams?

  Come on, that's the only way we can find out. Come to office hours with David and Ryan.

• 1:09:57Ryan Sean Adams?

  MicroStrategy, they just bought more Bitcoin. There you go.

• 1:10:00David Hoffman?

  6,455 new Bitcoins to come to a total amount of Bitcoins of 138,955. They also paid off a loan that was collateralized by Bitcoin. We tried to unpack it, didn't really understand it. Something else happened, but anyways, MicroStrategy bought more Bitcoin. It was a while. It was a while since they bought another Bitcoin.

• 1:10:20Ryan Sean Adams?

  David, you didn't want me to include this link, but we had some discussion about it. Do you know how much?

• 1:10:27David Hoffman?

  God, Ryan. For the record, I told him to not do this.

• 1:10:32Ryan Sean Adams?

  Let me finish. Let me finish, David. Okay, if MicroStrategy had purchased ETH rather than Bitcoin, rather than $4 billion, do you know how much they would have, David?

• 1:10:41David Hoffman?

  I'm assuming more, more money.

• 1:10:44Ryan Sean Adams?

  $6.5 billion.

• 1:10:46David Hoffman?

  Almost double. If they had bought ETH and said.

• 1:10:49Ryan Sean Adams?

  David wanted to strip this because

• 1:10:51David Hoffman?

  I told Ryan to not do this.

• 1:10:53Ryan Sean Adams?

  Yeah. And I was like, you know what? I am gassed today. You be breaks.

• 1:10:58David Hoffman?

  Yeah.

• 1:10:58Ryan Sean Adams?

  Try to stop it.

• 1:10:59David Hoffman?

  YouTube viewers will notice that he typed in the URL instead of pulling it up.

• 1:11:06Ryan Sean Adams?

  This might get cut by our editors. I don't know if this will make it, but let's talk about this. The NASDAQ is launching crypto custody service in Q2. The NASDAQ? What? Are they abandoning stocks, David? Are they looking over their shoulder at the crypto walking?

• 1:11:21David Hoffman?

  And they're just totally abandoning all stocks and equities, going crypto only. That's the news. No, I'm kidding. They're first primarily providing custody services for Bitcoin and Ethereum. This is the top of the rabbit hole of a long list of potential services that they could do. It starts with custody.

• 1:11:38Ryan Sean Adams?

  Kind of cool. Avalanche had an outage last week. What happened?

• 1:11:42David Hoffman?

  Avalanche, the C chain was out of order for about 50 minutes, halted the block production. A bug related to blockchain validation. They released an update. This was the second time that this has happened in seven days, which triggered me to make a tweet that caused me to fight with a bunch of Solana and Avalanche people. And that was more or less my weekend.

• 1:12:02Ryan Sean Adams?

  And David's sorry about all of that. And he takes it all back. Yes.

• 1:12:08David Hoffman?

  There are some tweets that I could have phrased better. There are some tweets that I could have been more precise. Everything I said, I completely believe. I've never written a single tweet that I didn't believe in. There are a couple, a couple, one or two might be out there.

• 1:12:20Ryan Sean Adams?

  Except those ones.

• 1:12:21David Hoffman?

  Except those ones. Yeah.

• 1:12:23Ryan Sean Adams?

  Yeah, except the ones that were deleted later. The US is charging SBF for bribing China? How much more trouble can this guy get in? Okay, what's happening now with Sam Bankman Freed? That is the SBF. Sam Bankman Freed, he is charging with paying $40 million to Chinese officials as a bribe? So that they would unfreeze his hedge fund's accounts?

• 1:12:48David Hoffman?

  Yep.

• 1:12:48Ryan Sean Adams?

  That sounds like a crime, David.

• 1:12:51David Hoffman?

  Yep. Well, they're frozen for a reason. But I guess it was China that froze them and he paid them $40 million to unfreeze them.

• 1:13:00Ryan Sean Adams?

  All right.

• 1:13:00David Hoffman?

  Okay.

• 1:13:00Ryan Sean Adams?

  Well, now he's in trouble with two governments, I guess. This is some AI news, which we usually don't cover, but I think this is important. This is an open letter.

• 1:13:10David Hoffman?

  Yep.

• 1:13:11Ryan Sean Adams?

  To pause all giant, large scale AI experiments. And I gotta think that this is maybe not inspired by the Bankless podcast with Eli Eizer, but certainly inspired by Eli Eizer himself.

• 1:13:24David Hoffman?

  Yeah.

• 1:13:24Ryan Sean Adams?

  And his caution and concerns about AI safeties, issues. Bankless listeners might know if you didn't listen to this episode earlier, you can catch it in the archive. We had Eli Eizer Yudkowsky on, who basically told us we're all going to die because AIs.

• 1:13:42David Hoffman?

  Quite literally.

• 1:13:44Ryan Sean Adams?

  Quite literally, going to become super intelligent or in the process of becoming super intelligent. There was no way to keep them aligned with humanity and our ethics and morality. And so that would result in the inevitable demise of human beings. The AIs would just basically sort our atoms and do something else with them. So it seems like that's not just him that's concerned about this. This is an entire open letter saying to stop, to pause all large scale AI experiments. Like, stop ChatGPT-4 is what I'm reading in this article. Give us some more context.

• 1:14:18David Hoffman?

  Stop all AI innovation more powerful than ChatGPT-4.

• 1:14:22Ryan Sean Adams?

  That's the limit.

• 1:14:22David Hoffman?

  Because that's the system. All right, we're at ChatGPT-4, like armistice, like everyone pause, everyone stop. So this is the Future of Life Institute, which is a nonprofit organization that works to reduce global catastrophic and existential risk facing humanity, particularly from advanced artificial intelligence. So this is a petition that you can go sign. It's already signed by Elon Musk, Steve Wozniak, Gary Marcus, Yoshua Bengio, I don't know, and others. If that is something that you believe.

• 1:14:54Ryan Sean Adams?

  Yuval Harari, David.

• 1:14:54David Hoffman?

  Oh, wow.

• 1:14:55Ryan Sean Adams?

  Andrew Yang?

• 1:14:56David Hoffman?

  Oh, wow. Yeah, wow, that's a Max Tegmark, man. Oh, you need to read some books by Max Tegmark. Our Mathematical Universe, have you read that? Also, Life 3.0, oh, great books, great books. Dude, really like them.

• 1:15:09Ryan Sean Adams?

  Look at these names.

• 1:15:11David Hoffman?

  Yeah.

• 1:15:11Ryan Sean Adams?

  What's your take? Are you gonna, are you gonna sign this, David? What's your take on this?

• 1:15:19David Hoffman?

  I don't, I need to consider that.

• 1:15:20Ryan Sean Adams?

  I don't know enough to sign this.

• 1:15:22David Hoffman?

  I don't know. I actually really had to consider that for a moment. I don't know.

• 1:15:25Ryan Sean Adams?

  And I actually, I'm worried that signing a letter is not going to do anything to stop it regardless.

• 1:15:31David Hoffman?

  Right, because this is a Moloch problem, right? So like, say nine people out of 10 agree to sign the letter and pause while.

• 1:15:38Ryan Sean Adams?

  And one defects.

• 1:15:38David Hoffman?

  And one defects. Well, then that one person just gets the lead, right?

• 1:15:41Ryan Sean Adams?

  Or one company or something.

• 1:15:42David Hoffman?

  This is a classic Moloch problem. Yeah.

• 1:15:45Ryan Sean Adams?

  Well, uh, we're gonna.

• 1:15:46David Hoffman?

  I will have to say that the ELIA's are podcasts that we did, like I've heard from multiple people that it had made waves in the AI community and more than it had before. And I think it was important that ELIA's did a non-AI podcast for that to reach new audiences and permeate outbound. So I'm not, I'm, I think this is not necessarily a coincidence that this letter is happening right now.

• 1:16:08Ryan Sean Adams?

  Look, we are not done exploring AI, the AI safety problem. And I think our next, the next stop for, for Bangless is to get the kind of the counterpoint to ELIA's. There's someone who's a bit more optimistic on AI. So we've got some guests lined up in, later in April.

• 1:16:22David Hoffman?

  Yes.

• 1:16:22Ryan Sean Adams?

  So expect to deep dive there and maybe at some point.

• 1:16:25David Hoffman?

  This will be a fun piece of trivia. The AI, the AI guest that we have recorded, I think we're recording with him next week or maybe the week after. No, a couple, a couple of weeks. Yeah, week after, spoke at ETH Denver 2018. So if you care to find out who that is, there's a little bit of trivia for you.

• 1:16:42Ryan Sean Adams?

  All right. Someone will find out. Dune integrates ChatGPT4. Wow. Okay. Speaking of, is this the crypto plus AI? Of course, you know, conversation, this is Dune Analytics. Fantastic dashboard for coming up with all sorts of crypto analytics.

• 1:16:59David Hoffman?

  We use it so frequently on the roll up to show data. It's a kind of a complicated dashboard to operate. As in, I haven't really dove down how to spin up a board, but I mean, I guess data always uses it. Hildabi uses it. We've used Dune Analytics on the weekly roll up many, many times. It requires kind of a technical brain to operate.

• 1:17:17Ryan Sean Adams?

  This is what's so fascinating though about ChatGPT and why I think it's so hard to stop because like, like right now, it's so damn useful. Could you imagine going to like, you and I don't know SQL, not very good with this. We can't construct our own boards. Wouldn't you love to be able to go to like Dune Analytics and type in like, give me the number of ETH addresses from date, you know, January to, to March that staked ETH. Boom. Outputs an answer.

• 1:17:43Ryan Sean Adams?

  Like, that's what ChatGPT-4 can do, and it's going to consume all of this public available blockchain data anyway. And so that's part of the Moloch trap is how do you stop it? So it's too useful to try to shut down.

• 1:17:56David Hoffman?

  All the Dune board creators who do like selfless work and create boards for us to view. Like, again, like people like Hill Dobby, people like Data Always, there's a few others. We are now going to be thanking ChatGPT-4, and their services will no longer be needed. Sorry, guys.

• 1:18:15Ryan Sean Adams?

  Well, look, the bull case is for them is it allows people to operate on a higher order of rather than constructing the dashboard, you just have to know what questions to ask.

• 1:18:25David Hoffman?

  Yeah, I said that facetiously because I thought it was funny.

• 1:18:27Ryan Sean Adams?

  Sorry, I'm taking things too seriously because it's the AI topic and it scares me, David.

• 1:18:33Ryan Sean Adams?

  That's cool. By the way, I am an investor in Dune Analytics, and I don't think we mentioned this, you and I are both investors in L2Beat. Got to mention this, of course, all of our disclaimers are always at bankless.com/disclaimers. David, MetaMask is integrating Sign In with Ethereum much more natively these days. What's this news?

• 1:18:55David Hoffman?

  Yeah, so this is Bruce ID, the Twitter account, as Bruce is basically the studio behind Sign In with Ethereum. So Sign In with Ethereum is now being, so like, everyone knows, they're like, you know, login with Facebook, login with Google. MetaMask is now having like a login, a sign in button, and it is integrating with the Sign In with Ethereum protocol. And so that is what is being announced here today. Sign in with Ethereum and integrated with MetaMask.

• 1:19:20Ryan Sean Adams?

  David, I think we're going to see Sign In with Ethereum on more websites, including

• 1:19:24David Hoffman?

  Including ours.

• 1:19:25Ryan Sean Adams?

  This little website right here, bankless.com has silently added the ability to connect with your ETH address. Look at me doing this. Connect your wallet, the real bankless way to log in. All right.

• 1:19:36David Hoffman?

  MetaMask, our favorite wallet and sponsor ever. Thank you.

• 1:19:40Ryan Sean Adams?

  Connecting with an address, boom.

• 1:19:43David Hoffman?

  Sadly, we don't see that part on the screen. Sign in to verify identity. Let's fucking go. This is dope.

• 1:19:48Ryan Sean Adams?

  There we go.

• 1:19:49David Hoffman?

  We don't see the Metamask because Zoom doesn't do the screen share for Metamask. Sorry.

• 1:19:53Ryan Sean Adams?

  Right. And then I just signed in. So I linked my wallet with my bankless citizenship. And now I don't have to log in in order to access all bankless citizen content.

• 1:20:04David Hoffman?

  You don't have to log in with your email and password. You do get to log in with your Ethereum address. So when we launched the bankless website, it was unequivocally the most, one of the most positive responses about the website. Like everything, everybody was positive except for one complaint.

• 1:20:19Ryan Sean Adams?

  No signing with Ethereum.

• 1:20:20David Hoffman?

  Which was that they, that they needed to log in with an email and password. That was the one, everyone, everything was unequivocally positive. And this one person was like, bankless, bad, because signing in with an email address. And first off, I'll remind you, we're a newsletter. We need your email address. And fast forward, however, many weeks ago, we launched this website about a month ago. Now we have signed with Ethereum.

• 1:20:45Ryan Sean Adams?

  Yeah, it's just actually, it was like two weeks. It took us.

• 1:20:48David Hoffman?

  God, that was, oh, two, wait, when did we launch the website? Two weeks ago?

• 1:20:52Ryan Sean Adams?

  Mid, yeah, two weeks, two, maybe two and a half.

• 1:20:54David Hoffman?

  Jesus. Time is weird.

• 1:20:56Ryan Sean Adams?

  Zoom in. By the way, speaking of zoom in fast, do you like that? Kraken Exchange just announced an official partnership with Williams Racing. What's cool about this is there's some way that Kraken has provided for you to get your NFT potentially on the back of a race car.

• 1:21:16David Hoffman?

  Yep.

• 1:21:16Ryan Sean Adams?

  On the back of a Williams Racing race car.

• 1:21:17David Hoffman?

  This is a partnership with Williams Racing of F1. So this is F1 Motorsports.

• 1:21:21Ryan Sean Adams?

  It's not NASCAR.

• 1:21:22David Hoffman?

  Not NASCAR, European, yes. So New Horizons, New Frontiers for Kraken, if you will. So they have a Kraken logo on a race car. So Kraken's getting a race car and they have real estate on this race car for your listener, you, that's you, your NFT could be on the Kraken race car. How do you get your NFT?

• 1:21:43Ryan Sean Adams?

  Do not freaking put your dick butt on the back. Do not shame the crypto industry.

• 1:21:47David Hoffman?

  I could.

• 1:21:48Ryan Sean Adams?

  Don't.

• 1:21:48David Hoffman?

  I could do it.

• 1:21:49Ryan Sean Adams?

  I'm asking you not, I'm asking you not to though.

• 1:21:51David Hoffman?

  Not to try. How do you feel about an MF'er?

• 1:21:55Ryan Sean Adams?

  He's totally gonna try. I feel fine about an MF'er.

• 1:21:58David Hoffman?

  Okay, but not a dickbutt.

• 1:22:00Ryan Sean Adams?

  Honestly, whatever you want to do, dude. It's permissionless. All right. I can't stop you anyway. I won't even try.

• 1:22:06David Hoffman?

  So the details of how to get your NFT on this race car is in this link in the show notes. You put your NFT, I'm assuming this is how this works. You put your NFT into the Kraken NFT platform and then probably sign up. I bet you that's how that works.

• 1:22:20Ryan Sean Adams?

  There you go.

• 1:22:21David Hoffman?

  Kraken is a sponsor of Bankless. Thank you.

• 1:22:23Ryan Sean Adams?

  Also adding layer two support, which we always appreciate. You can now send and receive your stable coins natively to Arbitrum. There you go. David, some other layer two releases going on. Conduit is a crypto native infrastructure program that allows you to launch a roll up in just a few clicks.

• 1:22:43David Hoffman?

  I'm pretty sure we predicted this feature would be coming. Like you can now issue a token, the OP stack. Yes.

• 1:22:48Ryan Sean Adams?

  Yeah.

• 1:22:48David Hoffman?

  So the whole idea, a long, long time ago, was that the OP stack is the ERC 20 token for rollups. Here we have a startup that is executing on that idea. So that not only is this a release, it's also a raise announcement. So this is a startup that raised, I think, $7 million from Paradigm. And they are one-click OP stack deployment. Man, that is really, really cool.

• 1:23:09Ryan Sean Adams?

  I think it's really cool.

• 1:23:10David Hoffman?

  Yeah, that's really cool.

• 1:23:11Ryan Sean Adams?

  We're gonna have, you know, you know how it's very easy now, like to launch your, your own token? And that was revolutionary in 2016 with Ethereum has basically provided a platform for that. Now it's going to be just as easy to launch your own entire chain. So we're going to have an absolute explosion of chains when it's as easy to spin up a website, launch a token as it is an entire chain. David, we got tokens, we got chains, we also got jobs, David, new jobs of the week. And I gotta do a shout out for a very important role Bankless is hiring for. What do we need here?

• 1:23:43David Hoffman?

  What we need is someone to edit this podcast that you are listening to right now. We are looking for a podcast video editor slash media operation. So if you are familiar with audio and video editing software, if you've ever edited a podcast before, if you've ever edited a video before, we are interested in talking to you. Especially if you live in EST or European time zones, because a Bankless nation never stops producing content. So we quite literally need a podcast editors across the globe. Because Ryan and I produce way too much content at all hours of the day. So that is the job. If you want to work directly with me and Ryan to edit and produce podcasts, please click link in the show notes and apply.

• 1:24:24Ryan Sean Adams?

  We got 30, maybe 40 million downloads, I think, on the podcast. We're trying to get to 100 million and then a billion. That could be a metric you help us reach here. Got some other jobs going on too. Rise is hiring a marketing manager, a sales development representative. Uniswap needs a senior product designer, an application security engineer, and a senior mobile engineer who's a React native. You can find all of that and more at the Bankless job site, bankless.pallet.com/jobs. David, what do we have coming up next?

• 1:24:53David Hoffman?

  Coming up next, we got the questions from the nation. We're going to talk about whether or not Ryan changed anything about our portfolio as Balaji scared us out of our pants. We'll talk about that as well as who was the first ZK EVM on mainnet. And then we got some takes of the week and we got what we're bullish on. And then we got some memes of the week. There's more than one meme this week, so stay tuned because both of them are very, very good. But first, I'm hoping to talk about some of these fantastic sponsors that make this show possible. Learning about crypto is hard, until now. Introducing MetaMask Learn, an open educational platform about crypto, Web3, self custody, wallet management, and all the other topics needed to onboard people into this crazy world of crypto. MetaMask Learn is an interactive

• 1:25:33David Hoffman?

  platform with each lesson offering a simulation for the task at hand, giving you actual practical experience for navigating Web3. The purpose of MetaMask Learn is to teach people the basics of self custody and wallet security in a safe environment. And while MetaMask Learn always takes the time to define Web3 specific vocabulary, it is still a jargon-free experience for the crypto-curious user. Friendly, not scary. MetaMask Learn is available in 10 languages with more to be added soon, and it's meant to cater to a global Web3 audience. So, are you tired of having to explain crypto concepts to your friends? Go to learn.metamask.io and add MetaMask Learn to your guides to get onboarded into the world of Web3. Arbitrum One is pioneering the world of secure Ethereum scalability and is continuing

• 1:26:18David Hoffman?

  to accelerate the Web3 landscape. Hundreds of projects have already deployed on Arbitrum One, producing flourishing DeFi and NFT ecosystems. With the recent addition of Arbitrum Nova, gaming and social dApps like Reddit are also now calling Arbitrum home. And Nova leverage the security and decentralization of Ethereum and provide a builder experience that's intuitive, familiar, and fully EVM compatible. On Arbitrum, both builders and users will experience faster transaction speeds with significantly lower gas fees. With Arbitrum's recent migration to Arbitrum Nitro, it's also now 10 times faster than before. Visit arbitrum.io where you can join the community, dive into the developer docs, bridge your assets, and start building your first app. With Arbitrum, experience Web3 development the way it was meant to be.

• 1:27:03David Hoffman?

  Secure, fast, cheap, and friction free.

• 1:27:06Ryan Sean Adams?

  We've got the questions of the week. This is a question from Bigwiggle501 from the Bankless Citizen Discord. "After your chat with Balaji, does your portfolio remain the same? Or have you made any changes?" I think this is a question to you and I. Did you make any changes after the 90-day Bitcoin bet and our conversation with Balaji?

• 1:27:27David Hoffman?

  I want, Brian, you to guess whether I changed anything.

• 1:27:31Ryan Sean Adams?

  No, David, you did not change a thing. Unless there is the slight probability that you just purchased some more ETH, is my guess.

• 1:27:41David Hoffman?

  I would consider that not changing my strategy.

• 1:27:45Ryan Sean Adams?

  So you didn't?

• 1:27:46David Hoffman?

  Correct, yes. I will say, like, during the Balaji week, the Bitcoin, the Bit Signal week, I was like, "Hmm, okay, maybe I should perhaps reconsider my position, reconsider my trade."

• 1:27:57Ryan Sean Adams?

  Because you don't have any Bitcoin, or you have a little bit of Bitcoin? What's your...

• 1:27:59David Hoffman?

  Well, technically, I'm short Bitcoin because I have sold Bitcoin for Ether to do my Ether long bet.

• 1:28:06Ryan Sean Adams?

  I think that that's short Bitcoin relative to ETH. It's not short Bitcoin.

• 1:28:09David Hoffman?

  Relative to Ether, not to the dollar.

• 1:28:10Ryan Sean Adams?

  I don't think you would be short Bitcoin to the dollar.

• 1:28:12David Hoffman?

  Oh, I would never, ever be short any crypto asset, ever. God, are you insane?

• 1:28:18Ryan Sean Adams?

  Why would you? I'm offended.

• 1:28:20David Hoffman?

  Remember the person that got liquidated shorting Luna while it was crashing? Like, no way. No way. Anyways, so no, I did not change anything. I, while I did, like, need to, like, take a moment and, like, reflect it and reconsider. It's like, okay, Balaji's saying this, Arthur Hayes also saying this. Perhaps this is not the time to have a net short position against Ether versus Bitcoin. I waited until next week to, like, sleep on it and then reassess. And I have decided that I will not do anything.

• 1:28:50Ryan Sean Adams?

  So you're you're still bullish on ETH relative to Bitcoin.

• 1:28:53David Hoffman?

  Yes.

• 1:28:54Ryan Sean Adams?

  So you're you're still making a bet on the ratio then too.

• 1:28:56David Hoffman?

  Correct.

• 1:28:57Ryan Sean Adams?

  You've been doing more.

• 1:28:57David Hoffman?

  Correct. Well, like I said, that is an 18 plus month long position. And I don't think anything's changed.

• 1:29:05Ryan Sean Adams?

  My position has not changed either. I've been long Bitcoin for a long time.

• 1:29:09David Hoffman?

  All right. So Ryan actually does on Bitcoin.

• 1:29:11Ryan Sean Adams?

  I do. I have not purchased Bitcoin also in a long time. And I will continue purchasing ETH. I think that everything that Balaji and Arthur say.

• 1:29:25Ryan Sean Adams?

  I I don't do this in my mind, but like you can kind of substitute Ether as an asset. I don't think that Balaji or Arthur fully understand or believe in the monetary premium virtues of Ethereum in a high conviction way that you or I do. I think anything basically that benefits the monetary premium story of Bitcoin actually doubly benefits, maybe I shouldn't maybe claim kind of any sort of ratio, but

• 1:29:53David Hoffman?

  Yeah, right.

• 1:29:54Ryan Sean Adams?

  even more so benefits the Ethereum narrative over the long run. So I haven't changed a thing.

• 1:29:59David Hoffman?

  Over the long run, big emphasis on over the long run.

• 1:30:02Ryan Sean Adams?

  Totally.

• 1:30:02David Hoffman?

  Because I actually will take Balaji's side that and and I do take Balaji's side that the banking crisis puts the wind in the sails of the Bitcoin narrative.

• 1:30:12Ryan Sean Adams?

  Totally.

• 1:30:12David Hoffman?

  And also the long term Ethereum fundamentals. But emphasis on long term, like that doesn't hit until later. But Ryan, that is the long term perspective that you have, that you take.

• 1:30:22Ryan Sean Adams?

  Yeah, it was kind of it was basically it was more confirmation. Okay, well, this is what crypto people have been saying for for a while. And it looks like this is this is happening. So I haven't changed a thing, but what also was really like already way overweight crypto. So there's not much I could change. I can't get any more bullish. All right.

• 1:30:41Ryan Sean Adams?

  This is a related question, though. If you're going to have an IRA for a 70 year old crypto friend. 70, not seven year old. How would you diversify into ETH and Bitcoin? So somebody on the older side in that generation, what would you advise them of 100%? So they have their pool of other assets and now they want to know, I've got some pool for crypto. What should I buy? Not financial advice, but your hypothetical friend.

• 1:31:07David Hoffman?

  If I was a financial advisor who would in theory therefore give financial advice, which I'm not.

• 1:31:13Ryan Sean Adams?

  For entertainment only, then what would you say?

• 1:31:15David Hoffman?

  If it wasn't for entertainment only. Yeah. So the 70 year old is an interesting detail because that implies like, you know, an end of life phase. And so the question is like, yeah, how healthy is a 70 year old? Are they live in like five more years, 20 more years? Like how much? Right. Well, I mean, like at that point, like you have to start to consider these things, right? And so if we're thinking a five to 10 year long time horizon, the shorter the time horizon, the more weight I would go to Bitcoin. And if we are thinking that this is a 70 year old yoga person who still goes on runs, then I would start to shift more towards Ether. So if we're thinking short term, I would go 50 50 Bitcoin Ether, because that is my bias towards Ether.

• 1:31:57David Hoffman?

  And then, you know, as soon as we start to hit like 10 to 15 to 20 year long time horizons, I would start to go, maybe if we're doing a 20 year long time horizon, I would go 80% Ether, 20% Bitcoin.

• 1:32:08Ryan Sean Adams?

  Yeah, that's similar to what I would say. And it's interesting, you're not saying any other tokens, but like, so it would just be ETH and Bitcoin, right?

• 1:32:16David Hoffman?

  I mean, if they want to hear my shitcoin portfolio, I'm happy to.

• 1:32:21Ryan Sean Adams?

  My base case would be like.

• 1:32:23David Hoffman?

  To talk about that.

• 1:32:24Ryan Sean Adams?

  70, actually, I would do either 70 or 80% ETH and either 20 or 30% Bitcoin. And I would do that ETH, a portion of that nice staked ETH. I mean, if you are in your seventies, like how nice is it to have some sort of fixed income asset as well? So you have the option to kind of sell it as it comes in or keep it. And that is something that ETH staking provides and is pretty unique. So I'd definitely overweight on ETH either 70 to 80%, but I would have some Bitcoin. It wouldn't be 0% for a 70 year old.

• 1:32:59David Hoffman?

  I think that's right.

• 1:33:00Ryan Sean Adams?

  Okay.

• 1:33:01David Hoffman?

  And by the way, I say the term shitcoins like endearingly, like I love my shitcoins. I don't, I don't think they're shitty. I love them.

• 1:33:08Ryan Sean Adams?

  The term of endearment.

• 1:33:09David Hoffman?

  Yes.

• 1:33:09Ryan Sean Adams?

  This is a Rocket Pollster question. Who really was the first ZK EVM to mainnet? Who won, David?

• 1:33:17David Hoffman?

  Yeah. So like, I'll put a metaphor, you know, when like, I did this to my sibling. You know, when like a sibling like licks something to claim something.

• 1:33:26Ryan Sean Adams?

  Yeah.

• 1:33:26David Hoffman?

  That's kind of what happened with the ZK EVMs. It's like that one just like, you know, stuck their tongue out.

• 1:33:32Ryan Sean Adams?

  Got you on a technicality?

• 1:33:32David Hoffman?

  Yeah, exactly. ZK Sync was technically first, beat Polygon by a few days. I will have to say, ZK Sync has been around for, since 2017, 2018. We were processing Gitcoin transactions with ZK Sync, the first ZK Sync rollup, which was a ZK rollup, not a ZK EVM, but so, but it's been around for a while. The fact that Polygon is anywhere close to that is like a huge tip of the hat to the Polygon engineering team for catching up to, to, to, to ZK Sync. But ZK Sync was technically first.

• 1:34:03Ryan Sean Adams?

  There you go. ZK Sync was first. My, my answer would be, and does it matter? I mean, they were three or four days apart. Like, we're getting ZK EVMs every week now. I think we're okay. You know, that probably won't matter in the grand scheme of things. David, let's do some takes of the week. You ready? We'll start with yours.

• 1:34:21David Hoffman?

  Oh, man, this is, okay, this is the take that triggered a bunch of fighting out there. So, so sometimes, well, actually it was this one and another one. Sometimes, this is my take, sometimes I feel bankless. Us, that's us, right? Should victory lap more often? We ignored Solana, Avalanche and Terra during the bull market in which we got our not friendly label as blind ETH maxies. The thing that happened next was Solana went down 80% versus Ether. Avalanche went down 70% versus Ether. Luna is basically at zero. More or less for all the same reasons that they would be, that this is unsustainable. This is just like the in what's in vogue at the moment. And we chose to not cave to external pressure and not cover something that we didn't really understand

• 1:35:04David Hoffman?

  or believe in. And then meanwhile, we focus on layer twos. And so our listeners disproportionately. Fortunately, got the OP and Arbitrum airdrops compared to other media organizations because that's what we chose to focus on. And we also pounded the table about cross-layer-one bridge risk. So I can't take credit for, of course, all of this stuff, but I'm saying that our listeners leaned in towards layer twos more than alt-layer ones and also leaned in shied away from cross-layer-one bridge risk. And so we got a lot of shit in the second half of 2021 because that was not in vogue. Layer twos were not cool during that time. You know what was cool? Alt-layer ones. And you and I had conversations many times like, dude, are we out of touch with what's going on?

• 1:35:50David Hoffman?

  And perhaps in that moment, maybe we were. But this is when we decided that Bankless is making content for things that you and I believe in, not what other people want us to believe. And so that choice, I think, has been to the great benefit of our listeners so far. And all the choices that we've made about Bankless and the things we choose to talk about and how we talk about them, I would make again immediately. Bankless is not perfect, but neither is this industry. And I think if you can scroll down, because I don't have my own tweet manager, I only hope that we can continue this track record. And that was my take of the week.

• 1:36:23Ryan Sean Adams?

  Yeah, I agree with that. And you know, I gotta, I gotta play the role of making sure that we inject some humility into this, too.

• 1:36:31David Hoffman?

  100%.

• 1:36:31Ryan Sean Adams?

  Definitely doesn't mean that we're perfect. And maybe it's the Canadian in me, David, but like, I have a hard time tweeting a victory lap type tweet. So I'm glad you do that on behalf of Bankless. Because if we don't do it, who else is going to? But I will say, we're definitely not perfect. But I hope the listeners know that what you hear on Bankless is authentically what we actually believe. And we try to stay as curious and open-minded as possible. We're also not perfect at that. We also have our biases. But I'm actually not against, like, I think.

• 1:37:12Ryan Sean Adams?

  I think you want somebody in crypto to have biases, right? They just have to be biased towards the right things. Like whenever possible, we try to be biased towards bankless technologies and towards decentralization and towards things and products we think are making the world better and are in it for the long-term game. So I appreciate bias as long as it's not like it's long-term oriented bias. And we do try to maintain that here. So we appreciate like everyone kind of holding us accountable for these values. I do think at times we've been maligned a little harshly. But yeah, we're going to keep bringing this platform to you guys.

• 1:37:52Ryan Sean Adams?

  And you'll always know that when you come to bankless, this is what David and I authentically think, whether it's right or wrong. And maybe we'll be a little stubborn on some of our convictions. I think that's reinforced that a little in us finding the balance of conviction. And yet being open-minded is probably the sweet spot for all investors. Last thing I'll say on this is do not expect bankless to be journalists. Don't use the, we are not journalists.

• 1:38:16David Hoffman?

  We don't like the J word. We don't like that.

• 1:38:18Ryan Sean Adams?

  We talk about, we talk about news, but we have, we are and always have been crypto investors that are on the journey going bankless. And we're just sharing what we're learning here. So yeah, maybe we turn that into what bankless is kind of taken and message.

• 1:38:33David Hoffman?

  And we also attempt to wear our biases on our sleeves. Like it's not like we're hiding them and like shoving them in the closet. Like I think we're pretty open and transparent about how we're biased. And I also followed up this tweet with one small more, another follow-on tweet saying, "I'll be much happier to talk about Solana and Avalanche, Ripluna. Next bull market after they've completed a full stress test cycle. Meanwhile, gearing up for another round of shit thrown at us during next year's next crops, next cycle's crop of new layer ones with a community, brand new people new to the space."

• 1:39:06Ryan Sean Adams?

  It does happen every cycle, doesn't it?

• 1:39:07David Hoffman?

  Yeah.

• 1:39:08Ryan Sean Adams?

  David, this is a David Friedberg tweet. Cash is now a risk asset is a pretty big paradigm shift. Cash being a risk asset is a big paradigm shift. What's he saying here?

• 1:39:20David Hoffman?

  Basically, this is talking about the bank insolvencies. Right? So if you hold your money in a bank and that bank is at risk of going insolvent, your cash is now at risk. The other thing you could do is hold the United States Treasuries, but like that's also at risk. And so like nowhere is safe in your dollars. Dave, David Friedberg is a co-host of the All In Podcast, for those that did not know that.

• 1:39:41Ryan Sean Adams?

  Right, right, okay.

• 1:39:42David Hoffman?

  He's the Sultan of Science, if you listen to it.

• 1:39:45Ryan Sean Adams?

  I also had a take on risk. I was thinking about risk this week and because there's something I was confused with when they teach you sort of portfolio theory and you go to kind of finance classes in your undergraduate or in business school, they always talk about this term called volatility. And the finance textbooks seem to equate volatility with risk, like they're one in the same. If an asset or portfolio is volatile, that also means it's risky. I gotta say, David, I as just an investor, like practically, have found that that is not true at all. And I think particularly when you look at like crypto, this is an asset that is very volatile, but surprisingly low risk. And I don't mean all crypto, by the way, because there are some very risky crypto assets.

• 1:40:30Ryan Sean Adams?

  But in particular, I'm talking about something like Bitcoin or Ether. And so I tweeted this, "I consider ETH a volatile asset. I do not consider it particularly risky. People often mistake volatility and risk." Another way to say that maybe is ETH and Bitcoin feel more risky than they actually are, for me, because they can go down 80%, like 85% relative to the dollar. That means they're volatile. But if you held, did you actually lose anything? And so going back to this tweet from David Friedberg, cash is now a risk asset. Right? For me, Treasuries are much more risky than ETH. Like I

• 1:41:09David Hoffman?

  Risk in the real way of it being risk, not volatility.

• 1:41:12Ryan Sean Adams?

  Yes. This is Fisk Antis who tweeted, I think clarified the point that I'm making. "Volatility becomes risk when, one, you use leverage. That's how volatility can increase risk. Or, two, your time horizon is short or unpredictable. That's totally how volatility becomes risk." But volatility and risk are not the same thing. And people, I think, look at crypto as an asset class and confuse those two. The other thing is number three is what I would add to Fiskanty's tweet here is if you cannot stomach volatility, that also increases your risk. If you have like a visceral emotional reaction to seeing your crypto portfolio appreciate 5X

• 1:41:56Ryan Sean Adams?

  and then go down 85%, or if you don't have convictions, another way to say this, you definitely increase the risk that you are going to hit the sell button. And it becomes a much more risky asset. So I don't know if that makes sense to you, but like, this is, by the way, what they teach you in business school. They teach you that volatility and risk are one and the same thing. And in order to decrease risk, you want to decrease volatility. But it does nothing to reduce tail risk. And it hasn't really, that paradigm on the world has not helped me become a better investor in the crypto asset space.

• 1:42:30David Hoffman?

  I think understanding that paradigm early on, when I was getting into crypto and everyone was like crypto could go to zero, it's super risky. But then you understand the fundamentals of crypto. It's like, it actually cannot go to zero. It actually, like, a buyer steps in somewhere, right? It kind of can't. And like, all of a sudden, like, you start to understand and unpack this difference. There's one thing about Fiskanty's tweet I want to change, actually, a little bit. Number one, if you use leverage, I want to change that to your measure of exposure. So like, say I have $100. If I have $1 of Bitcoin and $99, that volatility of Bitcoin is not a risk.

• 1:43:11David Hoffman?

  If I have $100 of Bitcoin and $0, and also I need to pay rent and put food on the table, then that volatility does become risk. And then you can also get into leverage and you can leverage $100 into $150. And then that volatility becomes super risky. So it actually isn't a binary about whether you are or are not on leverage. It's a function of your exposure to the asset and your short-term needs.

• 1:43:36Ryan Sean Adams?

  I think that's a great point and it's totally true. And I'd also say that might come packaged in with the term leverage. Because in a way, what you're sort of doing is you're leveraging your future ability to pay rent.

• 1:43:48David Hoffman?

  Sure.

• 1:43:48Ryan Sean Adams?

  When you like risk too much in crypto, right? I guess it's a form of leverage, but yeah, point is completely valid. All right, got to ask you the question, what are you bullish on this week, David?

• 1:43:58David Hoffman?

  Okay, so this is a different one this week. This is the Permissionless 2023 Twitter account, which its job is to promote the Permissionless 2023 conference, which I'm a huge fan of. I love promoting it. It is also, Ryan, the best meme account in crypto Twitter that I have been able to find. It is extremely obvious that a Zoomer runs this account, and they are making some memes that I have never seen before, and they are hilarious.

• 1:44:28Ryan Sean Adams?

  New territory, new frontier.

• 1:44:29David Hoffman?

  New territory, yes.

• 1:44:32David Hoffman?

  And so like, it's super Zoomer, and I chuckle at every single one. Also, there's a healthy amount of SpongeBob memes, which I'm a big fan of.

• 1:44:40Ryan Sean Adams?

  This is awesome.

• 1:44:42David Hoffman?

  Dude, even the least funny memes here are better than most people's memes. And so I'm bullish on, what I'm bullish on is like, I'm just bullish on the memes and jokes that are coming out of this, out of this account. Like, I will say, it's, I haven't seen this Twitter account do much else other than, one, promote Permissionless, and two, make memes about Permissionless.

• 1:45:05Ryan Sean Adams?

  This is why it exists.

• 1:45:06David Hoffman?

  And I'm sorry, this is just product market fit. I just love it. I just think it's so funny.

• 1:45:10Ryan Sean Adams?

  Well, David's so excited about the memes, which I also am. You know, the conference is coming up, and we're gonna be there. I hope the Bankless Nation is gonna be there. That's September 11th through 13th in Austin. Thousands of crypto folks there. It's talking about DeFi, talking about, you know, NFTs, talking about crypto, regulatory, institutional, everything. It's a fantastic conference. And by the way, if you are a bankless citizen, you get a discount, right, David?

• 1:45:36David Hoffman?

  30%, which pays for a year's worth of your bankless membership. Also, ticket prices go up every two weeks. I think they're something in the $400. They go up by a percentage, by the way, which means it's exponential. So if you are now interested in getting Permissionless ticket, you would behoove you to go get a ticket earlier and also pay the subscription while you're at it.

• 1:45:59Ryan Sean Adams?

  There you go.

• 1:46:01David Hoffman?

  Ryan, what are you bullish on?

• 1:46:02Ryan Sean Adams?

  I, look, I really enjoyed the Jim Bianco episode. It was my favorite episode that we put out this week, I think. And one thing that he said sort of stuck out to me, which we're beginning to see, the beginning of crypto decorrelate, become uncorrelated with the stock market, right? We have, we have promised the world... An alternative financial system, an alternative banking system. And if we are just acting like a risk on asset that is completely correlated with the stock market and it's just a magnified version of holding S and P 500, that's not the ticket. That is not an alternative banking system.

• 1:46:46Ryan Sean Adams?

  And so what we're seeing is, you know, bank stocks down, crypto up. That is a good indicator that we are starting to build on this harder path, which is an alternative money system, an alternative financial system that's there for you when the central banks and the banking system fail. And that's really as the existing system, as fault lines show more and more, as that narrative propagates, is that, as that truth propagates, crypto should be showing, should be going up.

• 1:47:22David Hoffman?

  Right.

• 1:47:22Ryan Sean Adams?

  And it's showing, or it's too early to call it, but it's showing early signs of actually doing that. And that, that makes me bullish because that means maybe the market is a little bit smarter and that we're not just like a, you know, meme, like funded meme stock kind of market as that's the way it was acting in the end of 2021 and 2022. This is, it feels much more real and substantive than ever before. So that's what's making me bullish.

• 1:47:50David Hoffman?

  Yeah. I think not only that, as in like crypto now can express itself independently from the stock market, but the other big takeaway I had with Stu Bianco was that the economy, the health of the economy is, is now being expressed in the stock market, which also has not been true for a very long time. And so the fact that those were divergent is not a sign of health. And the fact that economic strength is now a requirement for the stock market to go up just makes me feel good because that means Main Street and Wall Street are being connected again. So another reason to be bullish about the trad world.

• 1:48:24Ryan Sean Adams?

  Yeah, there you go. Speaking of Jim Bianco too, he puts out some dank memes himself. The Bianco Research account.

• 1:48:31David Hoffman?

  He's giving the permission, this account run for the money.

• 1:48:33Ryan Sean Adams?

  This is Janet Yellen. What are we looking at here?

• 1:48:36David Hoffman?

  So Jim Bianco tweets out, Yellen, the banking system is sound and resilient. And this is a Photoshop picture of Yellen, who's playing the slots at a casino. And let me tell you, it does not look photoshopped. That look, she looks like a lady who could be at the slot machines.

• 1:48:51Ryan Sean Adams?

  She looks like she's having a great time. I don't begrudge you this at all.

• 1:48:54David Hoffman?

  She's having a blast, man.

• 1:48:57Ryan Sean Adams?

  We also got another one.

• 1:48:58David Hoffman?

  Second meme.

• 1:48:59Ryan Sean Adams?

  Second meme of the week from Fiscanties.

• 1:49:01David Hoffman?

  Mm hmm. And this is a SpongeBob meme, so you know David included it. The US government says, let's kill crypto by any means necessary apart from total banning. Call it Operation Choke Point. And then crypto, and this is a picture of SpongeBob with like these pincer things that are squeezing SpongeBob made of a sponge around the neck. And you can just see SpongeBob is just like, just chilling.

• 1:49:22Ryan Sean Adams?

  He's just loving it.

• 1:49:23David Hoffman?

  He's just like, yeah, he's slightly giggling because he's a sponge, you know? Like crypto is like a river. It just routes around its most, the biggest obstacle and then continues.

• 1:49:32Ryan Sean Adams?

  I mean, the tighter they squeeze though, the bigger crypto gets. This is the, this is the problem that centralized institutions are going to have with crypto is like, you're proving our point if you squeeze us, you know? Risky disclaimers. Got to end with this. Of course, crypto is risky. You know it is. You could lose what you put in, but we are headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the bankless journey. Thanks a lot. None of this has been financial advice.