Pod Insights Bankless ROLLUP: Are Record Inflows Good For ETH? | New Crypto & AI Czar | Record Liquidations | Where To Next? About this episode This week on the Weekly Rollup: Bitcoin briefly plunged to $93K amidst $1.1B in crypto liquidations, marking the largest single-day event since 2021, with $815M wiped from long positions alone. Meanwhile, Ethereum ETFs hit a record inflow day of $428M, and Layer 2 solutions like Mantle are driving the ecosystem forward with nearly 1M ETH bridged to Base. On the regulatory front, the crypto world sees both challenges and opportunities as Trump appoints David Sacks as Crypto Czar while Microsoft shareholders reject Bitcoin on their balance sheet. With bullish predictions, such as Bitcoin reaching $250K, and major milestones like 1B unique crypto addresses, the crypto market continues its rollercoaster of volatility and growth.
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TIMESTAMPS & RESOURCES
00:00:00 Trump On Bitcoin Reserve
https://x.com/tftc21/status/1866895723410673988?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g https://x.com/tftc21/status/1866895723410673988?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g
00:03:43 MARKET
https://x.com/QuintenFrancois/status/1866445089909653545
https://x.com/DegenerateNews/status/1866957840805409049
00:13:47 L2 Update
https://x.com/jessepollak/status/1867047990843916334
https://dune.com/eekeyguy_eth/eth-supply-tracker
00:16:40 Bitcoin Reserve
https://x.com/InvestorAsh/status/1866221541400219847
https://x.com/el33th4xor/status/1866255029033943551
00:27:06 Donald Trump appointed David Sacks as a Crypto and AI czar
https://truthsocial.com/@realDonaldTrump/posts/113603133222686186
https://x.com/BitcoinNewsCom/status/1864857461481422934.
https://x.com/DavidSacks/status/1865199683087245405
00:32:26 CFTC Chair Rumors
https://x.com/emiliemc/status/1866686542649102586?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g https://x.com/emiliemc/status/1866686542649102586?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g
00:34:08 SEC - Crenshaw
https://x.com/eleanorterrett/status/1866981517932822540?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g https://x.com/eleanorterrett/status/1866981517932822540?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g
https://x.com/brian_armstrong/status/1865913522670260680
https://x.com/masonlynaugh/status/1866877145902948483
00:39:52 Should Ethereum Pump The Gas
https://x.com/dankrad/status/1863412876901306599
https://x.com/dankrad/status/1867078641118789787
https://x.com/drakefjustin/status/1865894859468427
00:44:44 MOVE Token
https://x.com/movementfdn/status/1866093209719579011
00:46:00 Magic Eden
https://x.com/MagicEden/status/1866483682367693227
https://mefoundation.com/
https://www.coingecko.com/en/coins/magic-eden
00:46:37 Pudgy Airdrop
https://x.com/pudgypenguins/status/1864851993094664602
https://nftpricefloor.com/pudgy-penguins
00:51:38 EtherRocks
https://x.com/etherrock/status/1865480491773640830?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g https://x.com/etherrock/status/1865480491773640830?s=46&t=2ZINVXJQKx6xO_6Wiiu_2g
00:53:30 Quantum Computing
https://x.com/InvestorAsh/status/1866221541400219847
https://x.com/caprioleio/status/1866355221670302170
https://vitalik.eth.limo/general/2024/10/29/futures6.html
https://x.com/el33th4xor/status/1866255029033943551
00:59:36 Stablecoin News
https://x.com/jerallaire/status/1866733181728366593
https://defillama.com/stablecoins
https://x.com/aave/status/1866127138820112562
https://x.com/defiignas/status/1866831563272712393
01:05:16 Meme Of The Week
https://x.com/sherlock_hodles/status/1866557875671187912
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Not financial or tax advice. See our investment disclosures here:
https://www.bankless.com/disclosures
Transcript 12,814 words · 10 speakers
Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
0:03 Ryan Sean Adams? So David, did you see this? Donald Trump was asked by Jim Cramer about crypto this week. Should we just play the clip? Yeah, absolutely.
0:11 Speaker 01 You're embracing crypto, very different from the previous administration. Strategic petroleum reserve like for crypto?
0:17 Speaker 02 Yeah, I think so. We're going to do something great with crypto because we don't want China or anybody else, and not just China, but others are embracing it and we want to be the head. We're going to be ahead of AI. We're going to be way ahead of AI and we've got to produce tremendous amounts of electricity. You know that it's unbelievable when you think that we need more than twice what we already have. If you think that's for a specific industry, but we'll be able to do it. We have Lee Zeldin in charge of the environment. He's going to be giving us very strong approvals, I think. And he's going to make sure everything's good and clean and proper, but he's going to give us very fast approvals.
0:53 Ryan Sean Adams? Donald Trump saying he will be doing something great.
0:56 David Hoffman? Full send. Donald Trump, I don't even know if he knows what accelerationism is, but he's embodying it.
1:02 Ryan Sean Adams? Oh, that's exactly what I was going to say.
1:04 David Hoffman? It's just full, it's turn it up to 11.
1:07 Ryan Sean Adams? Yeah, it's accelerationist, kind of like what are the accelerationist type? AI, energy and crypto, boom, all three, we're going to be great. We're going to exceed China. That's his message today.
1:17 David Hoffman? It is, I will admit, it is pretty refreshing.
1:19 Ryan Sean Adams? Wow, okay, well, we are in the second week of December. It's time for the Bankless Weekly Rollup.
1:24 David Hoffman? In the world of politics, crypto and AI has gotten a czar. Who is he? And will he be all in on crypto? Figure that out. You have heard him on this podcast before. We have clipped some of his content before. Also, liquidation Thursday, right after we finished recording the Weekly Rollup last Thursday, crypto prices tanked, record liquidations in crypto as leverage washes out of the market. But we're back. Leverage is back on the menu. The degens are gambling, we're not stopping here. Ethereum is getting record ETF flows. So we'll talk about that, painting some pretty big numbers. And then also is the Ethereum Layer One, finally getting a scaling upgrade. There are some murmurings in the EF camp and in the L1 capacity world.
2:10 David Hoffman? Talk about that. A bunch of tokens launches this week. Move, ME, Magic Eden, and Pengu. And MicroStrategy is expected to enter the QQQ. And how will that change crypto's market structure? These are the subjects, but there's like 20 more that we're going to get into as well throughout this episode. But first, before we get to all of those, a message from our friends and sponsors over at DYDX, which is introducing its whole new era. Unlimited, DYDX Unlimited, removes limits on what and how you can trade with perps and providing liquidity to. There are instant market listings with DYDX Unlimited, hence the unlimited, create and trade any market instantly with liquidity. Imagine launching a perpetual future market for a new token within minutes and having liquidity
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3:06 Ryan Sean Adams? I'm seeing a 49% yield here for the MegaVault.
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3:26 Ryan Sean Adams? I was pretty bullish when we talked to Antonio on Twitter a couple of weeks ago on DYDX Unlimited, particularly this like permissionless perps. Imagine AI agents creating permissionless perps.
3:38 David Hoffman? Oh, no. I'm not sure I'm ready for that.
3:41 Ryan Sean Adams? Oh, you're ready for it. Let's talk about the market price this week. We got Bitcoin and another week, not an all time high, can't say that, but we are above 100K, aren't we, David? What are the numbers on the week?
3:53 David Hoffman? Even with the nuking that we all experienced last week, Bitcoin is up 0.2% on the week. We are still.
4:01 Ryan Sean Adams? Not 2, 0.2.
4:02 David Hoffman? Not 2, not 2, 0.2. We are green on the week.
4:04 Ryan Sean Adams? All right.
4:05 David Hoffman? Call it flat. Started the week 101,400, ending the week 101,600. Actually, it's up $100 since I wrote these numbers. It's maybe we're up 0.4.
4:12 Ryan Sean Adams? Actually, this feels really good because on Thursday, as you mentioned, we got a massive liquidation. This was a sell off. Some people were saying it was over. Over David at that point in time.
4:21 David Hoffman? Idiots.
4:22 Ryan Sean Adams? Not me.
4:23 David Hoffman? First, first cyclist.
4:25 Ryan Sean Adams? Not me. I think it's a lot of the, you know, people that are like looking in on crypto. We're like, huh, see, I told you it had 100K.
4:32 David Hoffman? Told you it's a scam.
4:33 Ryan Sean Adams? Now it's gonna drop down to 20. You got scammed.
4:35 David Hoffman? Bitcoin always crashes idiots.
4:37 Ryan Sean Adams? Anyway, that's a pretty steep candle here. Look at this. Did we go from 102K to all the way down to 92?
4:44 David Hoffman? To 92 and then we waked back up. Yeah.
4:46 Ryan Sean Adams? What? That's like a 10K drop.
4:48 David Hoffman? Do you remember April, May? May of 2021, after ETH ran from 1,000 to 4,000, Bitcoin did something similar.
4:54 Ryan Sean Adams? Yeah.
4:55 David Hoffman? Liquidity just dropped out of the market and ETH crashed from like $4,100 down to like $2,300. And liquidity just ran away from the market. The floor just fell out of the entire market. Now, was that the fair price for ETH or was that a justified crash? Well, in the time, in the narrow timeframes, yes, liquidity couldn't enter the market that fast. In the zoomed out timeframes, no, because ETH just went back up to $4,000, took it half a year to do that. But just a reminder, liquidity can just flee this market so fast. And this is why we can go and drop, this is, this is a small drop in the grand scheme of things. But it is a reminder that how fast liquidity can change in this market.
5:37 David Hoffman? And you can make very big movements very, very quickly, which is why so many people got liquidated.
5:42 Ryan Sean Adams? Yeah, it's healthy too. I mean, this kind of thing needs to happen. We're kind of like, you know, cleaning up all the scraps here. It's like, I guess, I was expecting after that kind of liquidation, a 10K drop in Bitcoin price. And the rest of the market, of course, followed suit. I was expecting a longer duration. The fact that we are fully recovered now, David, tells you that we are in a bull market.
6:02 David Hoffman? We are bullish. People are bidding.
6:05 Ryan Sean Adams? That kind of liquidation doesn't tend to recover so quickly, but give us the stats on the liquidation. Look at this chart we're looking at. What's this?
6:12 David Hoffman? $1.1 billion in liquidations across centralized exchanges. That's the largest daily crypto liquidation since December of 2021, which is when the market started to turn. 815 million dollar liquidations came from long positions, 280 million came from short positions, which I don't know how they did that.
6:30 Ryan Sean Adams? Who's shorting this?
6:31 David Hoffman? I don't know. I don't own why anyone would short crypto. I do not know. And with that market turbulence behind us, people are still very bullish, not just crypto people, but also Tom Lee. Tom Lee went on CNBC earlier this week predicting $250,000 Bitcoin. Let's go ahead and listen to Tom Lee.
6:46 Speaker 04 How much of what we're seeing, maybe even a little bit today, is there's been such a regulatory overhang on a lot of these names under the current administration. Now you have a new FTC chairperson. Is that playing a role in any respect to this? Because Dan Ives put out a note today, said Christmas comes early with the new head of the FTC for tech.
7:09 Speaker 05 It's probably the best way to sort of measure this is what Bitcoin's doing. Because Bitcoin faced enormous regulatory burdens over the last few years. And now we have a White House that's embracing digital assets, a new SEC chairman, FTC chairman, a new Commerce Secretary. I think these are actually being viewed as pro-business, reviving animal spirits. But I think a good proxy is watching Bitcoin.
7:37 Speaker 04 All right, now I'm going to have to pin you to a target again on Bitcoin. Because I mean, you've been among the most optimistic and outspoken about it for years, to be quite honest. So here we are, above 100,000. What's a legit target for 2025 for Bitcoin?
7:52 Speaker 05 We think it's going to follow a similar halving cycle that we've seen in the past that would imply something around 250,000 for Bitcoin in 2025. And on top of that, we have a Trump put because Bitcoin is potentially a strategic reserve asset for the
8:08 Ryan Sean Adams? There it is. 250K is his base target, plus the Trump put on top of that. I got to say, Tom Lee has totally called this in the back half, the last half, part of the year. We had him on in August. You remember, this was right after that kind of the yen like trade kind of dip where the stock market like plunged and everyone was talking about recession worries and all of these things. And he was like, not a recession, we're still in a bull market. You're going to see higher highs in NASDAQ, S and P, and then also, and most especially crypto. So Tom's been right on in kind of the last quarter of this year. On the other side of that, though, is the Microsoft board. You'll recall, David, we were talking about the last couple of weeks, they had the opportunity
8:50 Ryan Sean Adams? to vote, shareholders, that is, of Microsoft, on whether to add Bitcoin to their balance sheet. So
8:56 David Hoffman? They did it, right? Why wouldn't they do it? They told, what was the vote? They put it on the balance sheet, right?
9:01 Ryan Sean Adams? Big company, a lot of cash reserves. What are you going to do with all that cash? Like, would you buy back your shares? Or you do what Michael Saylor's doing, it's working for him. That vote got turned down, and not just by a little bit. Only less than 1% of Microsoft shareholders actually voted yes on that one, so overwhelming.
9:17 David Hoffman? Is it too early in this market cycle to say, "Have fun staying poor"?
9:21 Ryan Sean Adams? I mean, they don't have to buy Bitcoin. They're, like, Microsoft shareholders are doing OK this cycle, all right?
9:26 David Hoffman? Have fun staying poor, Microsoft shareholders.
9:29 Ryan Sean Adams? Wow, wow, I don't know. I mean, they don't have to buy Bitcoin. It's just like, in fact, I think it's kind of silly sometimes for, like, you know, big balance sheet corporations to kind of, like, they should be investing in their business.
9:41 David Hoffman? Well, what do they get? What are they doing with it instead?
9:43 Ryan Sean Adams? Dividends.
9:44 David Hoffman? Right now, all I...
9:45 Ryan Sean Adams? Give me dividends, give me, I don't know, I'm a dividend man, so give it back to shareholders. If you, if you don't have anything to do with it, like, don't try to run a, you know, a fund or something like that, keep it in cash.
9:55 David Hoffman? Don't do it, Michael Saylor?
9:56 Ryan Sean Adams? Yeah, I don't know if that's old school or what that is, but tell me about ETH price, David.
9:59 David Hoffman? ETH price, 3,925 is where we started, up 1% to 3,942. ETH price during the big WIC went from like 3,900 down to 3,500. Has since bounced back. But, but it recovered slightly more than Bitcoin did. Still below that $4,000 mark, so we did get across $4,000 last week, which is pretty cool. Which is also going to record it.
10:25 Ryan Sean Adams? 4,800?
10:26 David Hoffman? It's like, something like $4,813 or $50. But like, I'm gonna, it's, real all-time high will happen like around 4,900. That's like true all-time high, that counts, but it's really $5,000 is the number to beat.
10:40 Ryan Sean Adams? I think we could be all-time high ETH in December.
10:43 David Hoffman? Oh, I totally agree, for sure. That's totally within reason.
10:47 Ryan Sean Adams? All-time high, December.
10:48 David Hoffman? All-time, all-time highs, yeah. ETH could paint a $1,000, like, weekly candle for sure.
10:52 Ryan Sean Adams? It's all discovery, like, when we're getting this 4K range and above, you could just see it just wants to punch through, wants to punch through.
10:58 David Hoffman? So Ryan, I, right after this weekly roll-up, I hop on a flight back to the Patagonia to go walk around some mountains. I'm out. No wifi for like eight days, nine days.
11:10 Ryan Sean Adams? You can't check price?
11:11 David Hoffman? Which is an entire weekly candle of price action.
11:13 Ryan Sean Adams? You don't have like Starlink or something? You can just like dial in and check crypto prices?
11:17 David Hoffman? Not, not, not backpacking on Starlink, no. No, no, no, so, uh, we'll see. We'll see what happens when I get back, but I'm gonna be like, it's just gonna be one price when I leave and a completely different price when I get back. You're gonna do the weekly roll with Sazil next week, so I will be out.
11:31 Ryan Sean Adams? Yeah, so are you saying like, I guess there's a history of David goes out and good things happen for crypto?
11:35 David Hoffman? Things have happened, correct. Things have happened. But like, it's all been regulatory stuff and like, there's no like more regulatory person to act. Like, we've already asked them all.
11:47 Ryan Sean Adams? Yeah, but it's, it's, I mean, it's about time for the market to, you know, figure out how bullish this space is. It's just like, it's building, it's still building.
11:53 David Hoffman? Yeah.
11:54 Ryan Sean Adams? One thing you can see that's building are these ETH inflows, man. It has been crazy. Look, total net inflows now, last week I remember it was just above a billion. Now it's almost 2 billion in total Ethereum ETF inflows.
12:08 David Hoffman? No, I think, if I remember correctly, last week we were, we were saying it was the fourth, I think. And we were saying we are, we are going to break above a billion by this time next week. The next day, it painted 0.43 billion in one single day, $430 million in inflows the next day. And now, now we are about to cross 2 billion. So we've, we've added basically a billion dollars of inflows in seven days.
12:33 Ryan Sean Adams? That's crazy, crazy. And you could see this on the charts here. See, see this, um, green line here? This is when we started to get into positive inflow territory.
12:42 David Hoffman? It looks like the inverse burn.
12:44 Ryan Sean Adams? It looks like the inverse burn. Do you know, um, it's actually a fun fact, how much do you think ETH is inside? Percentage of total supply is inside of, um, ETFs right now?
12:55 David Hoffman? Uh, 1 to 2%.
12:58 Ryan Sean Adams? It's higher, David. Uh, we are 3%, I want to say.
13:03 David Hoffman? 3%?
13:04 Ryan Sean Adams? I'm just looking at this.
13:05 David Hoffman? Okay.
13:05 Ryan Sean Adams? Oh, no, 2.78%.
13:07 David Hoffman? Okay, alright.
13:08 Ryan Sean Adams? And ETFs.
13:09 David Hoffman? Pretty good, that's pretty good. And like, a lot of it has happened in the last month.
13:12 Ryan Sean Adams? Almost one micro-strategies worth of.
13:14 David Hoffman? Almost one micro-strategy.
13:15 Ryan Sean Adams? In there. Uh, so it's looking good. How about the ratio?
13:19 David Hoffman? Ratio, um, I will say it has neither shown strength nor weakness. It has shown flatness since we started the month.
13:29 Ryan Sean Adams? Yeah.
13:29 David Hoffman? But historically, December has been a very good month, so we'll see what the rest of this month has in store. Total crypto market cap, we are almost at $4 trillion, $3.85 trillion, uh, which is just nuts. We'll be at $4 trillion, we'll probably be at $4 trillion this year, before you know it, yeah. Next week is within reason. Also, Layer 2 update brought to you by Mantola, Layer 2 that we know and love. Jesse from Base says, "Countdown to 1 million ETH bridge to Base." We are at 994,000 Ether in the Base Bridge contracts. And Mateus from Grow the Pie put out this tweet that I liked. "Today, 3 years ago, the median transaction costs on Layer 2s like Arbitrum OP mainnet were between $2 and $5.
14:08 David Hoffman? Now they are between .001 dollars, so 1/10 of a penny, and 5 pennies, 99% cheaper." Long way, we've come a long way since 2021. Still a lot of juice left to squeeze.
14:19 Ryan Sean Adams? I think that's a pretty good story for Ether. It's getting locked up in Layer 2s, right? So you got like about 3%, maybe 4% of ETH supply in Layer 2s. You got another 3% or 4% inside of, um, ETFs, Ethereum ETFs. That's a pretty good story, I think, for the cycle. Well, you have fees dropping on Layer 2s. So, you know, some tailwinds there, certainly.
14:42 David Hoffman? And then movers of the last 2 weeks. We usually do movers of the week, we're doing movers of the last 2-day period. We have some pretty impressive numbers. AVE is up an incredible amount. I couldn't believe it when I saw $366 AVE. That's up something like 60% in 2 weeks.
14:58 Ryan Sean Adams? Is that all-time highs?
14:58 David Hoffman? The divi- that- No, outside mine is like something like $600.
15:02 Ryan Sean Adams? Really, okay.
15:03 David Hoffman? But it got there in the peak of DeFi summer. So AVE up 40% on the week, up 83% in two weeks. AVE is up 83% in two weeks.
15:13 Ryan Sean Adams? Well, I mean, it's just hitting numbers.
15:14 David Hoffman? And that is a DeFi index.
15:15 Ryan Sean Adams? I mean, it's hitting record numbers in terms of like loan value. Also, you know, the World Liberty Finance, you know, Trump and team.
15:22 David Hoffman? Yeah.
15:23 Ryan Sean Adams? Buying AVE. They're buying a ton of ETH. They're buying a little bit of Bitcoin. They're buying AVE and they're buying LINK right now.
15:29 David Hoffman? They're buying, they're buying the AVE token.
15:30 Ryan Sean Adams? Yeah, dude. Well, they're building on AVE. So why wouldn't they?
15:35 David Hoffman? DY DEX is, is up 28% in one week and up 50% in two weeks. That's probably triggered by the hyper liquid airdrop in Meta. The hyper liquid new token, brand new token is up to $18 billion when it launched at something like $4 or $5 billion last week.
15:51 Ryan Sean Adams? That's been an incredible breakout story.
15:53 David Hoffman? Aerodrome on base up 22% in seven days, up 66% in 14 days. Athena is up to a dollar, coming up to 56% increase in two week period. And then Uniswap at $18, up 42% over two weeks. DeFi tokens catching bids, again consistently, consistently getting bids.
16:15 Ryan Sean Adams? I gotta be honest, this collection of tokens here makes a lot more sense to me than what we were talking about the previous two weeks of like XRP being up, you know, like 80, 90%. Like this, this is just, there's some fundamentals back here. Like all of these protocols are doing something, right? And doing something big. So this is like DeFi Renaissance territory.
16:35 David Hoffman? All of these have cash flows to them, every single one.
16:38 Ryan Sean Adams? Yeah, it's amazing. So suffice it to say, things are going pretty well right now in crypto land. It is a full on bull market and everyone's very excited. Now, we might be in a crypto bubble of sorts, right? Like this is all, we live and breathe this stuff. It's all we talk about. We're like permabulls have been since we entered this space. There is another section of the world that is not in this crypto bubble at all. I ran across this clip. This is a news anchor on MSNBC in the context of Trump kind of pivoting super pro crypto, talking about a Bitcoin reserve. This is the type of conversation that's going on on MSNBC. I'm just going to play the news anchor here.
17:21 Speaker 06 And in the new Congress, a Senate Republican, I want you to please pay attention to this. I know you want to tune out, but please don't. They plan to propose a bill that would sell off some of the Federal Reserve's gold to buy Bitcoin. Watch this.
17:35 Ryan Sean Adams? I just want to pause it here because that's not even correct. That's not what Lummis is proposing, Senator Lummis is proposing. Remember, we had her on the podcast. She's not talking about selling any gold, okay? She's talking about, you know, adjusting gold, the fair market value of gold in the balance sheet, essentially to its fair market value instead of its book value. So we're not talking about selling any gold. Anyway, that's flat out incorrect, but let's continue playing.
18:00 Speaker 07 Have we got a present for President Donald Trump? Here it is. This is the Bitcoin Reserve Bill. Over five years, the United States will assemble 1 million Bitcoin, 5% of the world's supply. And it will be held for a minimum of 20 years and can be used for one purpose. Reduce our debt.
18:39 Speaker 06 Well, Cynthia Lummis, you can take that bill and sit down with me any night of the week. And I would love to go through every word, every paragraph, every page. But I'd first like to know how much the crypto industry has given you. Because for fact's sake, you cannot pay debt down with Bitcoin. If Bitcoin crosses the $100,000 mark, like it did last week, that means it would cost the government at least $100 billion. And former SEC official John Reed was on 60 Minutes last night to sound the alarm about just how dangerous this industry is.
19:14 Ryan Sean Adams? Listen to this, David.
19:15 Speaker 08 Crypto is a scourge. It's not something that you want in your society. It has no utility. It's just pure speculation. Remember, there's no balance sheet to crypto. There's no financial statements. Every single crime you can conceive of is easier to do now because of crypto, especially ransomware, human sex trafficking, sanctions evasion, money laundering.
19:38 Ryan Sean Adams? All the bad things.
19:39 Speaker 08 North Korea is financing their nuclear weapons program.
19:41 Ryan Sean Adams? Think of anything bad.
19:43 David Hoffman? Let's associate Bitcoin with everything bad. Wow. You know what I thought while I was listening to that whole thing?
19:50 Ryan Sean Adams? What's that?
19:50 David Hoffman? This is such a great marketing tool for Bitcoin.
19:54 Ryan Sean Adams? Yeah.
19:54 David Hoffman? Like, it's so bullish. It is so bullish.
19:56 Ryan Sean Adams? It's just everywhere. Once you cross 100K, even those that are kind of like triggered by the Bitcoin reserve and 100K price point, they start talking about it, too. So, and attention feeds into crypto like nothing else. That was, do you know actually who that was? John Reed?
20:11 David Hoffman? John Reed? No, tell me.
20:12 Ryan Sean Adams? Yeah, so he said, that was a 60 Minutes interview on Sunday that aired. And Brad, the Ripple CEO, was on there. This guy was on there. John Reed is an SEC prosecutor. So, he was like, one of the ones who was going after crypto. So, you could kind of see the fervor through which they pursued. Actually, I want to play some more of this clip because then they had some guests on MSNBC. And let me just play this for you.
20:36 Speaker 06 Crime you can think of is exponentially easier because of crypto. Here to discuss, Zeke Fox, investigative reporter for Bloomberg Businessweek and Bloomberg News. He is the author of "Number Go Up: Inside Crypto's Wild Rise and Staggering Fall." Dan Nathan's still with us. I don't even want to say this would be the biggest bailout to crypto ever because they don't need a bailout. They're not in trouble. This would be the biggest bonus boon right there before our eyes, transferring billions of dollars to an industry we know almost nothing about.
21:10 David Hoffman? There's this fuck in our backs, bro.
21:12 Speaker 09 I mean, it's wild. People are mad right now about the health insurance industry's profits. It's a hundred billion dollars. That's a couple of years of the entire industry's profits that would be spent buying Bitcoins from people who already have them. And it is kind of a bailout.
21:27 David Hoffman? They're just chilling Bitcoin for us.
21:30 Speaker 09 It hasn't delivered on any of its promises. It's as old as Uber, it's old as WhatsApp, but nobody's really using it for anything.
21:35 Ryan Sean Adams? No one's using it for anything.
21:37 Speaker 09 Now, they've given Trump a lot of money. They've got him talking about coming in and having the government spend huge money to pump the price up even further. Yeah, it's really wild.
21:47 Ryan Sean Adams? This is just another side of the world I never see. I don't watch cable news at all. This is the discussion that's happening.
21:53 David Hoffman? They just gave the best marketing bit to Bitcoin. Like, I'm sorry. Like, okay, probably the woke lefties are watching this and they're like, "Okay, I'm fearful of Bitcoin now." But then, like, if the average person watched that, they were like, "Oh, the government's gonna pump Bitcoin. I'm gonna go and buy Bitcoin."
22:12 David Hoffman? Thank you. Like, I'm listening to that and they are just telling the world, like, not with the right tone, but like, "Yo, the government's gonna buy Bitcoin and isn't that terrible?" And I'm like, "The government's gonna buy Bitcoin, I'm gonna buy Bitcoin."
22:24 Ryan Sean Adams? Well, it's just interesting because I think it's because Trump is supporting it that they have to be on the other side of that, right? Because this is, you know, MSNBC and so they have to do that. But this is a narrative that's also going on. It just sounds like, I, believe me, I know what cope sounds like, okay?
22:39 David Hoffman? That sounds like cope.
22:40 Ryan Sean Adams? I'm an ETH holder, okay?
22:41 David Hoffman? That probably sounds like what it was like to listen to Bankless when Solana was pumping so goddamn high.
22:48 Ryan Sean Adams? All right. Well, you know what? The interesting thing about all of this, all this discussion is anybody who's listening to that and has stocks will likely have purchased, will likely be a net purchaser of Bitcoin in the future because MicroStrategy this month is very likely to enter the NASDAQ index. A lot of the people who own mutual funds, of course, they're invested in the NASDAQ, they're invested in the S and P 500. If MicroStrategy enters the NASDAQ, then they'll essentially own Bitcoin. MicroStrategy is a holding Company for Bitcoin, so they'll own Bitcoin without even knowing it. I find that ironic. Also, BlackRock this week. People have been asking BlackRock all the time, hey, what percent of crypto should I hold?
23:32 Ryan Sean Adams? Like, what's the reasonable range as a percentage of my portfolio? They finally came out and gave us a number, and that number is not 1%, it's 2%, which is a lot. A doubling. That's a doubling. A lot coming from BlackRock, right? So, you know, four years ago, BlackRock was saying like 0%, and then it was get off 0, now it's 2%.
23:54 David Hoffman? All right, that's a wrap on the market section. Coming up next, Trump has appointed the crypto czar. We're going to introduce you to David Sacks if you don't listen to the All In Podcast. Also, a new name for the CFTC chair that would be pretty bullish for crypto. If you are a long time Bankless listener, you have heard of this man before. And a reconfirmation vote for SEC Commissioner Caroline Crenshaw is up in the air. Will she be reconfirmed? Will she be confirmed? We do not like her. She was Gary Gensler's right-hand lady, so we're going to bring up this conversation and more. But first, a message to talk about some of these fantastic sponsors that make this show possible, especially Kraken, our preferred crypto exchange for buying crypto in 2024. If you do not have an account with Kraken, consider clicking the link in the show notes to getting started with Kraken today. Want to know the exchange we at Bankless use to buy, sell, and trade crypto?
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27:06 Ryan Sean Adams? Okay, let's set the scene here. We've got Trump, of course, new administration. We've mentioned some of the cabinet positions in previous weeks. And just the overall context here, David, is this is a 180 on crypto that we're seeing. It's like whiplash. I think you called this in our conversation with the Bitwise guys earlier this week. It's like a whiplash, but in a good way. Because the previous administration was so hostile.
27:29 David Hoffman? 10 out of 10 hostile.
27:31 Ryan Sean Adams? 10 out of 10. In ways we didn't know was actually going on. They were hostile. And the opposite is happening. The new administration in the executive branch.
27:39 David Hoffman? 10 out of 10 favorable.
27:40 Ryan Sean Adams? Yeah, it's like a pro crypto army on the other side. Some people will look at this like the MSNBC host previously and say that this is bad. This is an example of corruption or something like this. We are unapologetically pro crypto. So like for us, crypto is a freedom technology. This is clearly good. We needed to pivot in the other direction in the United States. Now, I do think it's important that we continue to preserve the decentralization values of crypto and not become kind of a banking cartel. But this is definitely the step that we need. So all of that is context. We're going to talk about a few more of the executive types of positions. But the first is this, the crypto czar, David. Can you give us some context?
28:25 Ryan Sean Adams? What happened this week with that position?
28:27 David Hoffman? Yeah, so it was the position itself was announced. TBD on what a czar position is. I think it's more symbolic in this present moment, but it's probably something along the lines of like Trump's chief advisor. We'll talk about that here in a sec. Crypto and AI, call it like tech czar, frontier tech czar.
28:46 Ryan Sean Adams? They combined it, right?
28:47 David Hoffman? They combined it, yeah. And you also heard Trump talk about crypto and AI in the same breath when we opened up this podcast. It's accelerationist. So call David Sacks the czar of accelerationist technologies in the United States. It's going to be something adjacent to deregulation. We know that if you listen to the All In Podcast, basically all of them are fans of deregulation. If you don't know David Sacks, he is a member of the PayPal mafia. He also founded Yammer, sold it to Microsoft in 2012. He's a general entrepreneur, venture capitalist, co-host of the All In Podcast, which is definitely one of the most dominant podcasts that are out there. Big fan of Elon Musk, big fan of Peter Thiel, definitely in the inner circle of right-wing
29:30 David Hoffman? tech Silicon Valley types. He also commented on Operation Choke Point, so he is aware of Operation Choke Point. He's got exposure to crypto, so his VC fund Kraft invested into BitGo and Bitwise. And then also I think he has personal investment into multi-coin capital, so he has a lot of Solana exposure. Or maybe it's through Kraft, one of those two things. He also launched an AI-powered work chat app called Glue. He says to support a freer ecosystem empowering AI companies to grow, strongly against AI models displaying any sort of censorship. So open source AI, open AI, and advocated for the integration of AI technology into warfare and national security tools. So depends on how you feel about that.
30:15 David Hoffman? And so, big question. What is a czar and what does a czar do anyways? Do you have any clarity on this for me, Ryan? Because I do not know.
30:24 Ryan Sean Adams? Yeah, a czar, I mean, that's a good question. It's certainly not a role that's like, you know, in the constitution or in any legislation anywhere, right? So, as you said, it's unclear how much power this position actually holds. There was a article this week from Bloomberg and according to Bloomberg, the designation is a special government employee. Okay, so this is like a part-time role. It doesn't require him to divest of his assets. It's not like a public servant in that way. Or he doesn't even have to publicly disclose his assets. So that's interesting from a conflict of interest perspective. And there's also, it's a part-time job, okay? So there's a maximum number of working days per year that a special government employee is supposed to spend,
31:07 Ryan Sean Adams? and that's 130 working days a year. So David Sacks is going to be still full-time on Kraft.
31:14 David Hoffman? It is an actual employed position. There's like a contract and a signature that has to go down. And it's a real position, not just a title.
31:22 Ryan Sean Adams? It is, it depends, I guess, how Trump sort of uses it, right? And what that role is. But I would have to think it's going to play a coordinator-type role inside of the Trump administration, right? An interface with AI, an interface with crypto. It's interesting that Trump seems to favor these kind of media personalities as well. I mean, like David Sacks has the megaphone on the All In Podcast. So if there's any shenanigans, any anti-crypto shenanigans going on in government, he not only says it in a kind of official crypto czar-type way and tries to sort of defang it, but he'll also have the All In platform, you know, the podcast platform to be a megaphone for that, too. So, I mean, all in all.
32:03 David Hoffman? It'll be the first podcast coming from inside the White House.
32:06 Ryan Sean Adams? This was, you know, I think I was, I'm not surprised by this choice.
32:10 David Hoffman? No.
32:10 Ryan Sean Adams? I would say it feels very, very Trump and, you know, David Sacks has been a huge Trump supporter.
32:15 David Hoffman? Oh, he has been beating the drums about Trump from a very early part of the All In Podcast.
32:20 Ryan Sean Adams? It's a reward for loyalty as well, right?
32:23 David Hoffman? It is, yeah, it is compensation in a way. In a different corner of the White House, CFTC Chair rumors. So, former CFTC Commissioner Brian Quintenz, who left the CFTC to join A16Z Crypto to work on policy over there, is now merging as a top pick for
32:42 Ryan Sean Adams? Wow.
32:43 David Hoffman? The CFTC.
32:45 Ryan Sean Adams? The Chair this time.
32:46 David Hoffman? The Chair, the Chair. He went from Commissioner to private sector to Chair, so.
32:50 Ryan Sean Adams? Maybe.
32:51 David Hoffman? Maybe, maybe.
32:52 Ryan Sean Adams? That's the rumor.
32:52 David Hoffman? Potentially going to Chair. So, a little bit of a revolving door there. Reportedly has been advising the Trump transition team on crypto policy. Current boss Mark Andreessen and David Sacks run in the same, like, conservative venture capitalist Silicon Valley circles.
33:07 David Hoffman? Emily Choi from Coinbase says, "Super bullish on the future of digital assets in the US if Brian Quintenz heads up the CFTC." I would say if Brian Quintenz sits on the Chair of the CFTC, that's like if Hester Peres sat on the Chair of the SEC.
33:20 Ryan Sean Adams? A hundred percent.
33:21 David Hoffman? That's how you should think about this.
33:23 Ryan Sean Adams? Brian Quintenz is just like fantastic. He understands crypto from the ground up. Like, we've had an opportunity to meet him, we've had an opportunity to talk to him on the podcast.
33:31 David Hoffman? He was at Permissionless. You were on a panel with him at Permissionless.
33:33 Ryan Sean Adams? I was just on a panel with him. I mean, like, you talk about the, again, the whiplash we were talking about, the pro crypto army being instantiated. Imagine you have all of these places. And by the way, in the new administration, it could come to pass that the CFTC actually has more authority over crypto than the SEC under Gensler was trying to get, right? So, this could be a very important role.
33:53 David Hoffman? But either way, SEC and CFTC with Paul Atkins, covered it last year fantastically pro crypto.
33:57 Ryan Sean Adams? Last week, yeah.
33:58 David Hoffman? If Brian Quintenz, yeah, last week, if Brian Quintenz gets this one, I don't know, pick one, I don't care.
34:03 Ryan Sean Adams? How can you get any more crypto?
34:05 David Hoffman? We're winning either way.
34:05 Ryan Sean Adams? Pro crypto. I know, okay. And so, actually, maybe the cherry on top for this week is there's actually a vote going on. So, do you remember Commissioner Caroline Crenshaw, David? Does that name ring a bell?
34:16 David Hoffman? The only, I know the name. The only time I put a face to a name and a voice to a name was when she was testifying along the other side of the other SEC Chairs. And she was basically just like Gary Gensler mini.
34:26 Ryan Sean Adams? Yeah, it was a mini me Gary Gensler, basically. And she's been against the Bitcoin ETF. She was on the side of, like even when Gary voted yes for Bitcoin ETF, she was a no. Right. Okay. She's been very anti crypto. In addition to her, there was another anti crypto commissioner, Jamie Elizoranga. And Jamie has decided to resign, actually, due to some family health issues. So that person's gone. Caroline Crenshaw was going to be renominated for her position. So she goes in front of Congress to be voted in again, renominated. And she's kind of like the last standing anti crypto SEC commissioner. My God, the Gensler Army has really fallen apart, hasn't it?
35:08 Ryan Sean Adams? Anyway, this was scheduled, a vote for her renomination was scheduled for December 11th. So that would have been Wednesday of this week. And it's been postponed. It's actually been deferred. The vote itself has been deferred. There has been an outcry from the crypto community to deny her vote. And a lot of the, you know, like a lot of Republicans are sympathetic to this. A lot of the politicians who want to get some checkmarks in the pro crypto column would also presumably vote no to this. This is Brian Armstrong. Caroline Crenshaw, he says, was a failure as an SEC commissioner and should be voted out. She tried to block the Bitcoin ETFs and was worse than Gensler on some issues, which I didn't think was possible. The Senate Banking Committee should take note.
35:53 Ryan Sean Adams? The crypto community is watching the vote. I'm told it will be factored into the stand with crypto scorecards for politicians. Wow, that is Brian Armstrong wielding the political stick. On the back of some major crypto wins this election cycle and sort of like saying, hey, politicians, you vote for Caroline Crenshaw, there will be consequences. We will remember.
36:17 David Hoffman? You really got to hand it to, I think, is one of the least appreciated galvanizers of the pro crypto army, which is Elizabeth Warren, the leader of the anti-crypto army. I think without that one meme of that blue picture of Elizabeth Warren is here to recruit an anti-crypto army. Did the most, some of the biggest ROI for crypto that I have ever seen.
36:42 Ryan Sean Adams? Maybe she was a pro crypto plant the whole time.
36:46 David Hoffman? Elizabeth Warren, number one pro crypto advocate. Well done for your work, Elizabeth Warren. All right, coming up next, is there growing consensus around increasing the Ethereum L1 capacity? More and more proponents are starting to voice their opinions. Not everyone is convinced, but some pretty key stakeholders have voiced their opinions on Twitter. We're going to go through some of them. Also, a bunch of tokens launched this week. Move, Magic Eden, Pudgy Penguins. And then this is, Ryan's going to take this one. Quantum computer breakthrough this week could spell trouble for crypto down the road. Is Bitcoin going to zero?
37:17 Ryan Sean Adams? Yes.
37:18 David Hoffman? Those are Ryan's words, not mine. He's going to explain them to you.
37:22 Ryan Sean Adams? No, it's a question.
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39:37 David Hoffman? Head over to Cartesi's grant application page to apply today. And if you're not a developer, those with staked CTSI can take part in the governance process and vote on whether or not a proposal should be funded. Make sure you're vote-ready by staking your CTSI before the votes open. Dankrat Feist, one of the core contributors to Ethereum, says on Twitter, "I think it's time we increased the gas limit." That means increasing the Layer 1 scale. He says, "If you run a validator, you can contribute to this. Every block acts as a vote on whether to increase it. If more than 50% of the stake agrees to an increase, the gas limit will increase." I just set my validators to vote for up to 60 million gas. So a little bit of context, this is actually how Ethereum has worked since the dawn of time.
40:18 David Hoffman? Previously miners, now today validators, would just signal what they think the gas size of a block ought to be. The current size of a block is 30 million, but miners, now validators, can actually vote this up individually. So this is kind of a validator-run consensus of Ethereum is how big should the blocks be? There has just been a long, sticky consensus at 30 million. Dankrat is saying that he has just set his validators for a doubling of up to 60 million, but not yet. He had to follow that up, saying, "Quick write-up to explain what's happening about the gas limit raise." That first tweet that I just read was December 1st. The tweet that I'm reading right now is from today, December 12th. "There has never been an increase in the gas since the merge.
41:00 David Hoffman? However, before the merge, it was an established practice that miners would not use this power arbitrarily, but typically only after Core Devs signaled it would be okay to change. Recently, some of us have started signaling that we think it is time for an increase in the gas. Unfortunately, that has hit a bit of a speed bump as Core Devs discovered that raising it over 40 million was not actually safe to a constant that needs to be changed in the clients first." I'm calling this kind of like a one-off anomaly construction of a client, just needed to get that fixed first. However, Dankrath continues, "I think there is a lot of messaging agreeing that 36 million is a good first step, so not over 40 million, but up to 36 million, again, from 30 million. And clients are releasing updates to make this the default, so validators don't have to manually use command line flags to vote for this.
41:45 David Hoffman? I think it is likely that some big pools will join us in the next few weeks and we will see this increase." Justin Drake also tweeting out on December 8th, "Configuring my validator for a 36 million gas limit. Staking operators control the limit. Ethereum has held a 30 million limit for 3.5 years. A 20% bump to 36 million safely greases wheels. You can see gas limits at pumpthegas.org." And then he goes on to ask, "When at giga gas?" and talks about snarked execution clients are the key to scaling gas 10x, 100x, 1000x, and then a few more details on that. So there's growing consensus that we can very quickly, today basically, get 20% more capacity on the Ethereum Layer 1, which I think is really just a gateway drug to get
42:30 David Hoffman? it to 60, which is where Dankrath wanted it in the first place. And then, and then we'll probably let the network stabilize a little bit. Some people will fall off the network. They will learn how to get back onto the network. They will get faster internet. They will just tinker with things. Optimizations will be had. And then 60 will become the new norm, and then we can do this again and again and again safely. So I am very appreciative of these conversations. I'm happy that Justin and Dankrath are putting these messages out there. What do you think about all this, Ryan?
42:57 Ryan Sean Adams? Yeah, I mean, I guess the context is, right? When you increase the block size from 30 to 60, you're just increasing the amount of transactions and throughput that Ethereum can sort of sustain. And it's like, the question is like, why not 100 then? Why 60, right? And the reason is because the more you increase, the increase in kind of the capacity it requires for staking, in particular, on the bandwidth side of things, right? Which is the real constraint.
43:26 David Hoffman? Bandwidth and stake growth, yeah.
43:27 Ryan Sean Adams? Yeah, bandwidth and state growth, and in particular, like bandwidth, right? So for other, you know, networks, it requires like data center level connections, like 1 to 10 gigabits per second, right? And Ethereum is supposed to be consumer-grade hardware, consumer-grade internet. And then you can kind of like stake using it, right? So that's really the trade-off space. But the big point is, we haven't adjusted anything in three and a half years. Bandwidth has gotten better. You know, hardware has improved, according to Moore's Law. And on a more routine basis, maybe we could just increase the gas fee gradually and preserve the staking requirements for validators. So that's kind of the conversation, what's going on.
44:07 David Hoffman? Definitely something that I'm going to be keeping an eye on. I think there's like path dependency here, where if we just jumped from 30 million to 60 million, that would be pretty aggressive and that would cause a lot of people to fall off the network. But if you like ease your way into 60 million, you can get there sustainably, reliably, securely. And you can end up in the same spot, but with a more resilient network along the way. So I'm a fan of this incremental improvements towards a higher gas.
44:32 Ryan Sean Adams? I'm sort of a fan of some way to just like, not program it, but have it regularly scheduled. So we don't have to always have this like kind of community debate every year or something like that, right? And that's sort of what Dankrad proposed, but it's going to take some time to get there.
44:44 David Hoffman? All right, getting into some token drops. The Movement Foundation has launched the Movement Mainnet and Move token. This is a layer two on Ethereum using the Move programming language. So this is a Move coming into the scene. Again, Move is this very well-respected, sought-after programming language coming out of the Facebook Dia Libram project, which has spawned many of these people who are building Move languages. Chains like Aptos, there's another one, sui, sui, Aptos sui, and now move being the layer two on Ethereum. So move is the gas fee token. So ETH is not the gas fee token, it's also the staking token and governance token. Dropped to a $1.6 billion market cap with a $7 billion totally diluted valuation.
45:27 David Hoffman? 10 billion total supply of the tokens, 2 billion of them are circulating. 10% of the total tokens was the initial move drop with 40% going into staking rewards, ecosystem initiatives, liquidity providing. And then also some early contributors and backers and then the foundation. There is a claims dot movement network dot XYZ to go see if you can claim your token if you're eligible. Otherwise, just use the bankless claimables app. That's why we build it for you. Snapshot was taken on November 23rd, 2024. So there is a link in the channel to find out all of that information. Also, Magic Eden dropped ME, a little different of a token drop. I've never seen this before.
46:06 David Hoffman? 1 billion supply came in at a $4.7 billion valuation, but the claim will be available across Bitcoin, Solana and multiple EVM chains. Ethereum mainnet base optimism arbitrum allocation fully unlocked at TGE. And ME is an SPL token, but the token is available across eight different chains, including Bitcoin. I don't know how they do that. Solana and some EVM chains. You have until February 1st, 2025 to claim.
46:37 Ryan Sean Adams? Those were two of the big token notices on the week, but there was also this one, David, the pudgy penguins token. And it caused a little bit of a stir. So Pengu, the official coin of pudgy penguins launching in 2024. Hasn't launched yet, right? But that's happening in December, I guess. We're running out of time in 2024. What is the story of Pengu from the pudgy penguins NFT project?
46:59 David Hoffman? Pengu is the ERC20 token that goes along with the pudgy penguins NFT. So if you have a pudgy penguin NFT, that is your claim on the token, along with little pudgies and pudgy rods. So makes sense. Tokens go to the NFT holders, but interestingly, like the Magic Eden token, but still slightly different. This token is being launched on Solana, which is interesting. Because the Penguins are NFTs on Ethereum, but the token is being launched on Solana. In the tweet thread that goes out, it says that they are looking to reach out to alternative broader communities because they already have the Ethereum community with their NFT. Why not just capture the Solana community with the token? So therefore launch it on Solana for distribution. I tweeted out this tweet that caused a bunch of consternation in the Ethereum space, saying,
47:44 David Hoffman? "Massive L for Ethereum, scale the layer one." My reasoning here was that, well, Solana has this community that is not the Ethereum community because Solana scaled the layer one. And so Pudgy Penguins went to go to that community, launch their token because that community exists because Solana scaled the layer one. So this is my call to action for the Ethereum community, why I'm interested in the whole pump the gas thing, because there wouldn't be as much distribution elsewhere if Ethereum had scaled its layer one. Now, I went and I asked to verify this take with Luca Netz. I just went to DMs with him on Twitter and asked him like, "Hey, can you just give me the spark notes about why you guys launched the token on Solana?" And he goes, "I think it starts and stops with gas fees.
48:28 David Hoffman? They're going to launch on abstract, which is the chain that they're going to build on, but they just don't want to rush it."
48:32 Ryan Sean Adams? Is that a ZK chain?
48:34 David Hoffman? That's a ZK sync chain, yeah, hyperchain, yeah. And they didn't want to launch on another layer two because they're building abstract. ETH mainnet not feasible for the millions of people that he wants to come into crypto. And so because Solana has the cheap fees and the alternative community that's not Ethereum, they decided to launch on Solana. So that was kind of the analysis behind there. That tweet, the Ethereum community really did not like that tweet from me. They thought it kind of like lacked nuance, which, yeah, it kind of does. So I'll admit that, but directionally, I stand by it.
49:03 Ryan Sean Adams? You said this tweet was lazy and lacked nuance, though, David. That's what you said.
49:07 David Hoffman? But I didn't say it was wrong.
49:08 Ryan Sean Adams? There are many ways of scaling the L1, and the majority of them I do not agree with for the much-needed elaboration. Dankrad, going back to Dankrad. So I think the reason some people took issue with your tweet was basically, you know, scaling the L1 is not enough capacity for all of the world's...
49:28 David Hoffman? It'll never be enough.
49:29 Ryan Sean Adams? It'll never be enough, right? So it's not necessarily going to solve this, right? It's almost like some people saw this as an orthogonal thing, which is basically like,
49:36 David Hoffman? It's definitely not orthogonal.
49:38 Ryan Sean Adams? We should scale the L1, but like, realize that scaling the L1 and becoming Solana, let's say, in a monolithic chain was never a theorem's path.
49:47 David Hoffman? It's never possible.
49:47 Ryan Sean Adams? And I don't think that's what you're saying here.
49:49 David Hoffman? It's also not what I'm saying.
49:49 Ryan Sean Adams? But that's why I didn't capture the nuance.
49:52 Ryan Sean Adams? One other general question I have for you, though, is why does, why do pudgy penguins need a coin? Just wondering.
49:59 David Hoffman? Don't ask questions.
50:00 Ryan Sean Adams? Okay.
50:02 David Hoffman? Don't ask questions.
50:03 Ryan Sean Adams? Okay.
50:04 David Hoffman? Sir, it's token season.
50:05 Ryan Sean Adams? Look, man, Luca is an incredible shipper. He's really turned that project around, killing it. Pudgy Penguins, I think, are NFT floor all-time highs now.
50:13 David Hoffman? Wow.
50:14 Ryan Sean Adams? And this is, look at this turnaround, David.
50:16 David Hoffman? 26 ETH, yeah. If you bought pudgy penguins below 2 ETH in the bear market, you're up a 10x in Ether terms.
50:23 Ryan Sean Adams? It's because of his leadership. I mean, they actually executed and delivered, so.
50:26 David Hoffman? God, I think pudgies might turn into the biggest bag of fumble I'll ever have.
50:32 Ryan Sean Adams? Oh, really? You had some pudgies, right?
50:34 David Hoffman? I had like, I had three or four pudgies, including two very clean pudgies, yeah.
50:39 Ryan Sean Adams? And what, when did you lose confidence?
50:41 David Hoffman? Shout out, oh, it wasn't about pudgy specifically. It was just getting burned on NFTs, like, all my, all my R blocks were down to zero. Like, everything that I owned, other than my CryptoPunk, was basically at zero. And I was like, alright, well, this was dumb. I just bought JPEGs. I just got bear market, bear market burned.
50:57 Ryan Sean Adams? Yeah.
50:58 David Hoffman? And I was like, okay, I'm just, and I wanted to like, clean out the wallet, because I always rotate my wallets. And so it was just easier just to liquidate them to eat.
51:03 Ryan Sean Adams? I mean, this was a turnaround, though. It's a founder-led turnaround. That's what really happened. So who could have predicted that, right?
51:08 David Hoffman? Dude, it was the next day, bro, that Luca acquired pudgy penguins. I sold my pudgies. The next day, Luca acquires pudgy penguins and it pops like 3x off the floor.
51:18 Ryan Sean Adams? We all have regrets, David. Let's not live in the past, alright? The future is bullish.
51:23 David Hoffman? Give me an regret, a regret of yours to make me feel better.
51:25 Ryan Sean Adams? Did you, um, my, my regret is, let me see my regrets.
51:29 David Hoffman? Not my regrets.
51:30 Ryan Sean Adams? All of my NFTs are regrets that I have. I could show you some ugliness in my portfolio, okay? And it's still there. I didn't even sell anything and they're still down bad. I never owned an Ether Rock, though. Did you own an Ether Rock?
51:42 David Hoffman? Bro, bro, okay, so Ether Rocks are these crazy, crazy, crazy, um, these crazy NFTs that are literally just rocks. Basically making a farce of how NFTs are just JPGs. So if somebody made JPGs of rocks with like different shades, they're just different shades. One's kind of gray, one's kind of blue, one's kind of green, uh, but they're basically just rocks. And I remember, and these went for, I think the top one went for like something like 50 or 60 million dollars in 2021.
52:08 Ryan Sean Adams? That's stupid. That's so dumb. How are we so dumb?
52:10 David Hoffman? It was so dumb. And I saw Ether Rocks, I looked at Ether Rocks, the OpenSea. I shared it in my Alpha group in 2021, like my friends, my college friends. And the Ether Rocks were going for like half an ETH to like one and a half ETHs. And I'd shared it in the group and I was like, this is absolutely redacted, but that's probably bullish. No one did anything.
52:33 Ryan Sean Adams? Including you?
52:34 David Hoffman? No one bought. I did not buy, no one bought.
52:36 Ryan Sean Adams? And then shot up to like 50 million?
52:37 David Hoffman? And a week later, one sold for like a hundred million dollars. And I'm like, what the hell?
52:41 Ryan Sean Adams? Wow. Well, so you missed it that time. You also missed it this time, David, because I regret to inform you. Ether Rock number 19 was purchased this week, it's not 2021, for 235 ETH. That is almost a million dollars.
52:54 David Hoffman? A million dollars.
52:55 Ryan Sean Adams? Okay, so our NFTs back, we got Pudgy's, CryptoPunks doing well, we got Ether Rocks selling. Is this a little comeback story, you think?
53:03 David Hoffman? I don't think so, not yet, not yet. Pudgy's absolutely, but Pudgy's is like the anomaly. Pudgy's is like buying Link or Ave or Synthetix.
53:11 Ryan Sean Adams? You gotta have fundamentals this time.
53:13 David Hoffman? Yeah, well, maybe, I don't know, but like CryptoPunks are up to a 40 ETH floor when they were once at 100. They're not dead. So what's happening right now is NFTs are not dead.
53:22 Ryan Sean Adams? Yeah.
53:23 David Hoffman? Pudgy's very much alive. NFTs generally not dead. Well, a lot of it is just like ETH beta exposure.
53:30 Ryan Sean Adams? You want me to give you the story of the quantum Ryan's gonna flood our entire industry. Bitcoin is not going to zero. Let me just, let me just say that upfront. He wrote it, he wrote it in the notes. A lot of people were saying this type of thing in kind of like mainstream. But the question is, could quantum compute computing threaten crypto? We've always known this is on the horizon. Why is, why was quantum compute even in the news cycle this week? All right. So this is a tweet from the CEO of Google. He says this, introducing Willow, our new state of the art quantum computing chip with breakthrough that can reduce errors exponentially as we scale up using more qubits. This was actually hailed in the quantum computing circles as a major breakthrough because of this ability to reduce errors exponentially. And it's not that Willow and the quantum computing at Google is very powerful now.
54:14 Ryan Sean Adams? It's not. It's just if they are able to reduce the errors exponentially, then they can actually scale this technology in a way they previously couldn't. So there are some estimates out there that, you know, we could start beginning, begin to break some of the strong encryption in like, you know, the year 2030, 2035, something like this. This may bring those timelines actually closer. This is hailed by many as a breakthrough technology. So a lot of people are asking the question is, okay, if quantum computing is now right around the corner, could it break our cryptocurrencies? Could it break Bitcoin? Right? Here's a tweet from investor Ash. University of Sussex researchers estimate that breaking Bitcoin encryption in one day would need 13 million qubits.
54:58 Ryan Sean Adams? Willow right now has 105 qubits. All right. You need 13 million. We got 105 right now. Not possible today, but theoretically, if you had 124,000 Willows, you could break encryption in one day. If you had 340 Willows in one year. Right? So it's closer than it's been previously. And this breakthrough might have brought it even closer. So the real reason that people are scared is like,
55:25 David Hoffman? If the time to break a wallet is like, if it's one year, well, then you could just move your Bitcoins on your wallet. And so you'll never catch up to you because you're moving your wallet. Not Satoshi, though.
55:37 Ryan Sean Adams? That's right, David. That's right. So that's kind of the thing. So this is the founder of Avalanche who's commenting here, Emin. He says, "There is an issue with Satoshi's 1 million Bitcoin." Remember this Bitcoin that his mind's been locked? Estimates are he's got about a million of it. So apparently, these Satoshi early mine coins use the very old pay-to-public key, P2PK format, which reveals the public key and gives the attacker time to grind for the mother of all cryptography bounties. P2PK isn't used by modern Bitcoin wallets or modern systems, but it was there in the early days of Bitcoin. So as quantum computing gets threatening, the Bitcoin community might want to look into freezing Satoshi's coins or more generally, provide a sunset date.
56:22 David Hoffman? Isn't that a hard fork? That's a hard fork, bro.
56:24 Ryan Sean Adams? Right. That's a hard fork.
56:27 David Hoffman? You can't hard fork Bitcoin. You cannot hard fork Bitcoin.
56:30 Ryan Sean Adams? But the problem is, there's a 1 million Bitcoin bounty on Bitcoin, which is like, I mean, I don't know, four times, five times the amount that the US government owns. It's like, you know, three times as much as Michael Saylor owns, available to whoever gets quantum computing to the level to be able to crack this, unless Bitcoin does something, unless it hard forks. So the threat is not imminent, by the way. I mean, we're still talking right now, five to 10 years away, unless something massive actually happens. But still, it's out there, David.
57:03 David Hoffman? The closest it's ever been, that's for sure.
57:04 Ryan Sean Adams? And I'm not saying it's existential, because we all know that Bitcoin has the ability to do things like socially. At least, most people who kind of study crypto can do this. Like, you can hard fork, you can correct this. But Satoshi's not moving his coins anytime soon. So that means there's a 1 million Bitcoin bounty out there. So what do you think this means? You think this means we'll have like hard fork wars? There'll be like a Bitcoin quantum and like Bitcoin classic in the future?
57:29 David Hoffman? This has been a long conversation in the Ethereum space, as like, there are some inevitable brick walls that Bitcoin runs into, one being the security budget, the other being quantum computing. And Bitcoin is like, fine until then. But then, once those things arrive, then it's like, then it's already too late. Like, you actually have to be proactive against those things. And so, yeah, like... The idea here with quantum computing is there Bitcoin has a death day. And so people talk about, oh, yeah, Bitcoin's not gonna.
57:57 Ryan Sean Adams? When you say death day, it's not quite, it's like, um, it has a reckoning, let's say, because it has to decide. I mean, what Emin suggested was freezing Satoshi's coins. Can you imagine that?
58:09 David Hoffman? Which, which is what people would say is not Bitcoin. If you can, if you are freezing people's coins, then that's something else other than Bitcoin. 21 million in property rights.
58:17 Ryan Sean Adams? People were happy to tell him that in like, in his, uh, you know, in the Twitter comments, basically.
58:23 David Hoffman? Yeah, I saw the first response was you can't free Satoshi's coins. Those are his coins, which I appreciate the sentiment. Also, might be untenable.
58:32 Ryan Sean Adams? Well, or, or you could just allow this game to play out and allow the first quantum computers, probably a nation state. With, you know, imagine the nation state reserve currency wars heat up. Everyone's stacking Bitcoin and so China and the US are in a race.
58:45 David Hoffman? Bitcoin inspired arms race for quantum computing.
58:48 Ryan Sean Adams? Yeah, can you imagine that?
58:49 David Hoffman? Donald Trump, you gotta add quantum computing to the accelerationist list.
58:53 Ryan Sean Adams? Get that 1 million in Bitcoin? Is that how it goes down?
58:56 David Hoffman? That's the reserve. That's how you fill the reserve. That's, that's how you pay off the national debt. You gotta fund quantum computing.
59:03 Ryan Sean Adams? We should have a synthol, uh, Lummus bill to just like fund the quantum computing to go collect the 1 million Bitcoin. Is that it? I mean, things get weird.
59:11 David Hoffman? That's right.
59:12 Ryan Sean Adams? Of course, it's not just Bitcoin. There are other crypto networks that require a quantum computing upgrade, notably Ethereum, which is like, it's sort of in the roadmap. It's, you know, like, that might need to be accelerated, but Ethereum doesn't have a problem like doing these types of quantum hard forks, right?
59:26 David Hoffman? Anything that can hard fork does not have this issue.
59:29 Ryan Sean Adams? Very interesting. We'll see how this ends up. You know, again, not an imminent threat. No, Bitcoin's not going to zero, but it is in the water out there somewhere.
59:36 David Hoffman? All right, three big stablecoin news this week. First, Circle and Binance entered a strategic partnership. This is something that I don't think I could ever have seen had CZ ever not bent the knee, but he did bend the knee.
59:49 Ryan Sean Adams? Yep.
59:50 David Hoffman? And so Binance spent the knees. Now Circle and Binance have a strategic partnership over USDC to announce that USDC will be extended inside the Binance platform.
59:58 Ryan Sean Adams? That's huge for USDC.
59:59 David Hoffman? Never thought I would see.
1:00:00 Ryan Sean Adams? Big way. That's exactly what it is, David. It's bending the knee. It's saying like, hey, we don't want to go to jails. Sure, we'll use your, your stable coins, US government apparatus.
1:00:08 David Hoffman? Your private CBDC. Yeah. So that's first news. USD, the dollar stablecoin from Athena, has flipped DAI. Wow. So Athena's synthetic dollar USD is now the third largest stablecoin behind USDT, Tether, and USDC. After doubling its market cap, currently clocking in at $5.5 billion, which DAI sits at 5.2. Has grown quite a lot because demand for leverage is increasing. So does Athena's yield, which is currently at 27%. So this is definitely bull market growth. Which, Ryan, makes me a little nervous.
1:00:43 Ryan Sean Adams? A little bit.
1:00:43 David Hoffman? A little nervous. A little nervous. Keeping an eye on that. But nonetheless, it is pretty cool to have a new style of stablecoin that's out there doing well. So congratulations to the Athena team. I'm sure their eyes are on it even more than mine. Coinbase third will restrict the EU citizens' access to DAI due to MICA regulations. So because DAI is not a MICA compliant stablecoin, Coinbase will restrict EU citizens' access to DAI, interestingly. But nonetheless, DAI is being replaced in the maker system by USDS, which are MICA compliant.
1:01:17 Ryan Sean Adams? It seems like there's no way for DAI to be MICA compliant as well. And they just designed it in such a way that it's just like impossible. So Europeans just don't get access to it. By the way, this, this is related. Did you see this? It was floating around the last week or so? This is public from scratch, US companies, all the US bubbles here, versus EU companies that have gotten to 10 billion in market cap in the last 50 years. Look at EU over here, Europe over here.
1:01:43 David Hoffman? US just has massive bubbles, you know, Apple, Nvidia, Microsoft, huge bubbles with companies with huge market caps. EU just getting absolutely mugged by the United States. Tiny little bubbles.
1:01:54 Ryan Sean Adams? It's just regulation, man.
1:01:55 David Hoffman? It's just regulation, man.
1:01:57 Ryan Sean Adams? It's just like, you can't do MICA, you can't do DeFi, you can't do all of these things. And we've got a taste of it in the US.
1:02:02 David Hoffman? Can't have fun, can't make money.
1:02:05 Ryan Sean Adams? Speaking of not having fun, the UK.
1:02:08 David Hoffman? Fantastic transition.
1:02:10 Ryan Sean Adams? No longer able to access pump.fun, okay? The UK said, "Enough of these meme coins." The UK's Financial Conduct Authority, FCA, another three-letter agency, issued a warning about pump.fun, stating that the platform is not authorized to operate in the country, okay? Added that customers dealing with pump.fun won't have access to consumer protections. I feel like we kind of knew that, but as a result, pump.fun is no longer available in the UK. I think they geo-blocked everybody in the UK.
1:02:39 David Hoffman? Meanwhile, some goddamn whiplash. Czech, Czechs do not have to pay taxes on crypto they held for three years. What the hell? Tax-free, three-year crypto gains? Are you serious?
1:02:54 Ryan Sean Adams? Yeah, that's happening.
1:02:55 David Hoffman? That is nuts.
1:02:57 Ryan Sean Adams? This is the Czech Republic, so if you hold your crypto for three years plus, encouraging holding behavior, that's very, very bankless aligned of them. You know, good, good, long-term hold. You don't have to pay capital gains if you sell it after three years.
1:03:10 David Hoffman? That is awesome.
1:03:12 Ryan Sean Adams? There's a tale of two jurisdictions going on right now. There's jurisdictions that are super crypto-hostile and other jurisdictions that are turning to crypto-friendly because they want the growth and the economics and the jobs and the industry to come to them. And those that are, you know, like, open to crypto will do much better. Those that are closed will not. I mean, this is how it works.
1:03:33 David Hoffman? Congratulations, all Czech listeners of the podcast. I'm very jealous.
1:03:37 Ryan Sean Adams? You think that could come to the US?
1:03:40 David Hoffman? No.
1:03:40 Ryan Sean Adams? No capital gains on crypto?
1:03:41 David Hoffman? Definitely not. That would be insane. That would be insane. I mean, I've seen, I've seen some pretty crazy things doing crypto in these years, so I'm not going to count it out, but that'd be kind of crazy.
1:03:50 Ryan Sean Adams? You never know.
1:03:50 David Hoffman? All right. This is going to be the end of the roll-up, guys. Thanks for sticking with us. We have fun doing these every single week. If you don't mind, please like and subscribe if you are watching this on YouTube. If you're doing Apple Podcasts, if you don't mind, again, opening up that podcast player and giving us a five-star review.
1:04:05 Ryan Sean Adams? We're Spotify, too, right? We made number 10 on the tech charts.
1:04:08 David Hoffman? That's right. Bankless is the number 10 technology podcast.
1:04:12 Ryan Sean Adams? Let's get us to top five.
1:04:14 David Hoffman? Yes, get us to top five. That'd be great. And also, just shout out, if you haven't tuned into the AI roll-up that I'm doing weekly with The E-Jazz, have you listened to it this week, Ryan? We're on our third.
1:04:23 Ryan Sean Adams? No, it's in my queue. I love them, though. It's fantastic. It's getting me very bullish on kind of AI. It's like crypto is so, I mean, that is the new frontier. And there's so much going on these days. You need like a dedicated weekly podcast just to keep up on the frontier of AI. Yeah, it's amazing.
1:04:41 David Hoffman? It feels like early DeFi just four years later. Yeah, I'm having a ton of fun with that. So definitely, this is your call to action to not miss the AI meta. The AI meta is the meta to pay attention to for 2025. That is where the hot ball of money is going to go. It is where it currently is. And so I think it's going to attract outside retail capital like all bull markets do. And they are not yet here, but they're definitely coming. And you are ahead of the curve. And that is why we are doing the AI roll up. So you can front run the opportunity. What do we always say on Bankless?
1:05:10 Ryan Sean Adams? Yeah, every Thursday, every Thursday.
1:05:11 David Hoffman? Every Thursday, it comes out Thursday. Yeah, the day before the Friday weekly roll up, which is just the normal news. All right, meme of the week, meme of the week. This one, I really, I chuckled at this one. I don't even know how to, I don't know what this meme is. I've seen it before, but this is a man who is looking at a picture of his younger self. The younger self is saying, is titled first cycle me. And then it's second cycle me, thinking how stupid I used to be. So second cycle me is looking at picture of younger self. But then there's third cycle me looking at a picture of second cycle me looking at first cycle me. Just looking at second cycle me reminded of how stupid I used to be. Which, Ryan, I don't know how you feel, but that is how I feel. Second cycle me was an idiot. Third cycle me is doing great.
1:05:55 Ryan Sean Adams? Second cycle you was an idiot, a complete idiot?
1:05:58 David Hoffman? No, I was first, I was very, very smart. And then I was dumb, in that order.
1:06:04 Ryan Sean Adams? And you're just like much older and wiser this cycle.
1:06:07 David Hoffman? That's right.
1:06:08 Ryan Sean Adams? Imagine what you're gonna be like, what kind of zen state are you gonna be? You're gonna be Eric Voorhees in the fourth cycle. Cause that guy's on like the fifth or sixth cycle, all right? That's how you get to Voorhees level.
1:06:16 David Hoffman? We're all just chasing Voorhees.
1:06:18 Ryan Sean Adams? That's right. All right, gotta end with this, of course. You guys know crypto is risky. You could lose what you put in, but we're headed west as a frontier. It's not for everyone, but we're glad you're with us in the Bankless journey. Thanks a lot.
Previous AI ROLLUP #3: Solana AI Hackathon | Truth Terminal’s Roadmap | Satan & God Automated | Delphi Digital AI Analyst Next Investing in AI, Crypto, & Tech in 2025 | Elad Gil Page updated October 12, 2026 · transcript and summary are machine-generated