ROLLUP: 3rd Week of December

🚀 SUBSCRIBE TO NEWSLETTER: http://bankless.substack.com/ ✊ STARTING GUIDE BANKLESS: https://bit.ly/37Q17uI ❤️ JOIN PRIVATE DISCORD: https://bit.ly/2UVI10O 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ 👕 BUY BANKLESS TEE: https://merch.banklesshq.com/ ----- GO BANKLESS WITH THESE SPONSOR TOOLS: ⭐️LEDGER - BEST HARDWARE WALLET TO SECURE YOUR CRYPTO https://bankless.cc/ledger 🚀 ZERION - INVEST IN DEFI FROM ONE PLACE https://bankless.cc/zerion 💳 MONOLITH - GET THE HOLY GRAIL OF BANKLESS VISA CARDS https://bankless.cc/monolith 🤖YEARN - YIELD-SEEKING MONEY ROBOT THAT FARMS DEFI FOR YOU http://bankless.cc/yearn ------ ROLLUP: 3RD WEEK OF DECEMBER MARKET: BTC Price - On the three year anniversary of the 2017 ATH, BTC breaks 20k and skyrockets to $23,800. - BTC on Ethereum: Down from 145k TO 141.5k ETH Price - $ETH is up $100 during the last two days, highs not seen since May of 2018 TVL in DeFi - $16.4B, up from $14B - DPI up from $101 to $115, Grayscale Insane premiums https://twitter.com/grayscaletrust/status/1339356060948312064?s=21 ETH now vs ETH Then https://twitter.com/sassal0x/status/1339192917735292928?s=20 $1B of ETH in the deposit contract https://twitter.com/sassal0x/status/1339522266237784065?s=20 Ethereum addresses with ETH in them passes 50M https://twitter.com/intotheblock/status/1339433477305876480?s=27 From CeFi to DeFi https://twitter.com/glassnode/status/1337410802396127233?s=20 The amount of fees on #Ethereum spent on $ETH deposits to centralized exchanges has fallen from ~25% in 2017 to less than 1% today. $3B in USDC https://twitter.com/jerallaire/status/1338662314355138565 ETH Option Open Interest at $1B ATH https://twitter.com/skewdotcom/status/1338818750166994944?s=21 RELEASES Ethereum futures from the CME https://www.theblockcrypto.com/linked/88028/cme-group-announces-ethereum-futures Maple Leaf Capital report on Ethereum and DeFi https://twitter.com/MapleLeafCap/status/1339346115322376192?s=20 Swivel Finance https://swivel.finance/ Interest rate derivative protocol built on Aave and Compound Circle announced high-yield USDC business accounts https://www.circle.com/en/features/yield Kraken announces accepting lightning depositsh https://blog.kraken.com/post/7225/a-need-for-speed-kraken-to-launch-bitcoin-lightning-%e2%9a%a1%ef%b8%8f-integration-in-2021/ Digital Yuan is here https://www.theblockcrypto.com/post/87754/china-digital-yuan-touching-pay Sybil governance delegation platform https://sybil.org/#/delegates/uniswap NEWS Coinbase IPO https://blog.coinbase.com/coinbase-announces-confidential-submission-of-draft-registration-statement-b140a9dfc9f5 One River Asset Management CEO Eric Peters, $600mm in BTC and ETH have been purchased to date, with the total set to exceed $1B in early 2021 https://casebitcoin.com/story/new-1b-fund-created-to-buy-btc-with-support-from-one-river-ceo Hugh Karp of Nexus Mutual has the majority of his NXM stolen from him by a relatively unknown attack vector https://www.coindesk.com/ceo-of-defi-insurer-nexus-mutual-hacked-for-8m-in-nxm-tokens Office of the Comptroller wants to issue ‘country coins’ to help incentive education https://fortune.com/2020/12/15/crypto-country-coin-brian-brooks-comptroller-of-currency-learning-student-incentives/ Long term incentive streaming for Eth2 public goods - 3,200ETH to start https://jamesfickel.ghost.io/towards-long-term-incentives-on-ethereum Pornhub: Now crypto only https://decrypt.co/51478/pornhub-now-accepting-crypto-only Beeple NFT massive success https://www.beeple-crap.com/nft https://twitter.com/niftygateway/status/1338268375156482050 $3.5M in sales from NFT auction ------ Don't stop at the video! Subscribe to the Bankless newsletter program http://bankless.substack.com/ Visit the official Bankless website for resources http://banklesshq.com/ Follow Bankless on Twitter https://twitter.com/BanklessHQ Follow Ryan on Twitter https://twitter.com/ryansadams Follow David on Twitter https://twitter.com/TrustlessState ----- 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 we may add links in this channel to products we use. We may receive commission if you make a purchase through one of these links. We'll always disclose when this is the case

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

• 0:07Ryan Sean Adams?

  David, happy 3rd week of January. What are we doing today?

• 0:11David Hoffman?

  We are rolling up the 3rd week of January. It is rollups time where we go through a whole entire week's worth of news in one single episode. Get that roll up and inject it right into your brain. We go through the market. We talk about what the market is doing. Then we go through releases. What got released in the last week? Then we go through some news. Talk about what happened in this last week of news. Then we get into some ecosystem takes. And then we finally finish it off with what David and Ryan are excited about. Ryan, are you ready?

• 0:41Ryan Sean Adams?

  I'm ready. I'm excited about a lot of things. Let's do this. All right. You want to start with markets, David? That's my favorite place to start anyway. So we have to start with Bitcoin price, but you know, I am, I'm really excited to talk about ETH price, but I'm going to hold my excitement for a minute. Let's talk Bitcoin.

• 0:58David Hoffman?

  Yeah, coming off of a very volatile last week, the 2nd week of January, where Bitcoin went from like $42,000 down to $30,000, up to $40,000. We're almost doing the same thing. Bitcoin is at $31,500 after touching $40,000 last week. So volatility is just keeping strong. And so people are gaining a little bit bummed about this drop in prices, especially right after we touched Ether price. This is just how it goes, folks. This is what the market does.

• 1:29Ryan Sean Adams?

  Up and down, a little bit of chop in the bull market, nothing to worry about. Let's talk Ether, David. It finally happened.

• 1:37David Hoffman?

  It finally broke its previous all-time high of $1,420, topped out at $1,440, which is awesome because we broke the all-time high, but kind of fucking lame because we only broke it by $20.

• 1:51Ryan Sean Adams?

  Oh, I don't even care. I mean, so like I was told so many times during 2018, 2019, that this would never happen and it just happened last week. I wish I could go back and like find all of the tweets that that, you know, that said that this would never happen, that Ether was dead, all of these things. Um, pretty, pretty satisfying, I think, that, that Ether went all the way back from a 95% drop, came back, hit its all time high. It's trading lower than that now. I don't really care. We hit the milestone, man. That's, that's what I wanted to see. And I think that's a great marker that this is the, the bear market or the bull market is in full effect. Where do you think things go from here?

• 2:34David Hoffman?

  Uh, yeah, other than up and to the right. Um, I think that we are in for some short-term chop. Um, but the ball, the ball has been rolled down the hill and there's no stopping it, right? Maybe, maybe some short-term chop in the next week or, or a couple of weeks, but like, people's attention are on this industry now. Like there, there's no stopping, stopping this from happening.

• 2:52Ryan Sean Adams?

  Anthony Sisano is out of jail now. Is this possible, this entire, this entire bump was engineered by Anthony? Is this possible just to get him out of jail?

• 3:02David Hoffman?

  Well, I did, I bought some ETH to explicitly try and help Anthony get out of jail. I know a few other people did. Anthony probably did too. Um, we will see how engineered this was, if it was engineered by Anthony or not. Of course it wasn't really. Um, but I think what, what this really tells us is, I mean, for me, um, this is the power of a high conviction bet. Uh, Ryan, you and I totally believe that this day would come where ETH would break its previous all-time high. And I believe that even when Ether was $80. I believe that at $80 Ether, we would once again see $1,400 Ether. And then, then we did.

• 3:36Ryan Sean Adams?

  Shout out to the holders. Uh, you guys helped make this happen and you reap the rewards when things like this do happen. David, let's talk DeFi for a minute. So where are we hanging with the DeFi pulse index?

• 3:49David Hoffman?

  At the time of recording, we are at $22.2 billion locked in DeFi. If we had recorded this a couple of days ago, or even yesterday even, it would have been over $25 billion. I think it peaked out, yeah, at $25.2 billion. That is the highest number ever locked in DeFi. And the DPI also similarly topped out at, I think, $225 per DPI index token. Currently, it's hovering around $205.

• 4:18Ryan Sean Adams?

  So DeFi tokens are coming along for this ride as well, though ETH kind of took the headlines earlier this week. Yeah, we were talking about holders, David, and Pantera put out this follow-up report talking about the upside to holding Bitcoin as an asset. And, you know, it's similar to ETH, the Bitcoin has a longer history. And here's the magic of it, David. In order to win at crypto, as long as you're buying assets like Bitcoin and Ether, all you have to do is hold. Like, that's it. So any time period, if you held Bitcoin for at least three and a half years,

• 5:01Ryan Sean Adams?

  you win, like, and you win by a lot. That's all you have to do. It sounds so simple, why is it hard?

• 5:08David Hoffman?

  Yeah, this is what this report from Pantera is saying is there are zero people who have held Bitcoin for more than 3.5 years who are not in profit, right? And this is, this actually kind of goes into how I think about some trades and some investments. You know, I'm not a trader. I don't really pay attention to the charts when I buy some assets like DeFi tokens that I want. And sometimes I buy at the wrong time because I bought into the hype and bought into the FOMO, and then it drops. But like, my, my, my personal bias, my personal rule of thumb is I never buy a token that I'm not willing to become a bag holder of. And the reason is because you can just hold your way out of the floor, right? You can just hold your way out of the bear. So if you're, if you have conviction about the asset and you're not a trader and you are an investor,

• 5:50David Hoffman?

  holding is the secret to success in this crypto market. And what this report shows is that it's, no one, zero people have been holders for more than three and a half years and are, and are not in profit with Bitcoin. And that's the maximum. That means it's probably even less amount of time for people to just hold through dips before they're in the profit.

• 6:09Ryan Sean Adams?

  Do you know what's crazy too? So this is a report that came out from Vision Hill. What Vision Hill does is they provide a composite index of a whole bunch of crypto funds. So that the private crypto funds that you have to be an accredited investor to get in, they basically track their performance. You know what their performance was in 2020, David?

• 6:29David Hoffman?

  I don't know, but I'm gonna go ahead and guess it's less than if they had just held.

• 6:32Ryan Sean Adams?

  It was less than if they just held. Exactly.

• 6:36David Hoffman?

  By a lot.

• 6:37Ryan Sean Adams?

  By a lot. So, you know, it depends on the funds. Different funds have different strategies. But the composite index, so kind of the index behind the other indexes, if you put your funds in the average crypto hedge fund, you would have done well last year. 170% up, right?

• 6:54David Hoffman?

  That's a great number.

• 6:55Ryan Sean Adams?

  That's pretty good. Good number. Like, be happy with that, I guess. But if you just held Bitcoin and did nothing, you would do 425% up.

• 7:06Ryan Sean Adams?

  Actually, I think these numbers might be wrong. I think Bitcoin was 360%. Okay, so the numbers we have on the screen are wrong, but if you just held Bitcoin, you would have gotten 360%. If you held ETH, all you did was hold ETH, you would have done 425% up. So, holding Bitcoin, holding ETH in 2020, you would have outperformed all of the geniuses in their crypto hedge funds, maybe not all of them, but the average. And you wouldn't have incurred any fees. So these hedge funds charge a 20%, 20% to 30% annual performance fee on the profits, plus 2% annualized. No fees, holding Bitcoin, holding Ether, you would have outperformed them.

• 7:49Ryan Sean Adams?

  Like, it's not only that you're going to be profitable on a holding strategy for any time period greater than three and a half years. You're actually gonna outperform most crypto hedge funds on that time horizon.

• 8:04David Hoffman?

  This is why on the bankless program, we talk about the value of the crypto monies, specifically ETH and BTC. They are the benchmarks for this whole entire industry. And this also illustrates why it's so powerful to actually practice like crypto and DeFi and Ethereum is a skill. And self custody is one of those first skills that you learn. And if you gave up bothering to learn that self custody skill and instead just went to the funds to and just exported your responsibility of researching and learning and getting your hands dirty. If you just didn't bother to do that, you lost all out on like two to three X more gains than you would have if you had learned to buy and hold the crypto monies, the Bitcoin and Ether and do it yourself.

• 8:46David Hoffman?

  That's, that's the cost of not actually teaching yourself the skills to be in crypto.

• 8:51Ryan Sean Adams?

  Yeah, absolutely. And you know what? Holding is a skill too. Last thing I'll say in this, I had a friend who came to me in, in 2018. And he said, you know, gave me some advice, which I buy, talked about Bitcoin and Ether. He went out and bought ETH, he bought it at like $500, right? And 2019 and I, and my, my, my advice was basically, hey, if you're doing this, you gotta buy and hold for five to 10 years, right? Like that's it. Just don't touch it, but buy and hold for five to 10 years. And he texted me in, in 2019 and he was like, oh, so this is going well. So his $500 ETH had dropped to like, you know, the low hundreds. Uh, and then it turns out he sold it, you know, like this is the thing.

• 9:31Ryan Sean Adams?

  It's it. Holding is also a skill that you need to develop as part of your crypto investment strategy. And you have to, you have to learn how to ignore the volatility and, and look at the long, look at the long term on this, on this thing. So, David, fundamentals, while we're talking about it, let's talk about this, this thread from Spencer Noon. There's 11 signs, he says, that ETH is going to blow past its all time high. This is a thread all about fundamentals, which, which fundamentals do you want to pick out of this thread, David?

• 10:03David Hoffman?

  Well, of course we have to mention fees. We really enjoy the fee metric on a bankless program because of how ungameable it is. There's no better way to prove that there is demand. For a blockchain by showing how much money people are willing to pay to use it. According to this screen cap that Spencer took, you know, the last seven days of fees for Ethereum was $7.2 million. Seven day average Bitcoin was $4.3 million. And then even Uniswap, an application on Ethereum, collected $2 million worth of fees. These are big numbers.

• 10:38Ryan Sean Adams?

  Yeah, absolutely. A few other things. The number of ETH transactions.

• 10:45Ryan Sean Adams?

  This is, he says, is 7X smaller than its 2018 game all time highs. And so he says, this is a sign that whales and institutions still haven't entered the game. What's he saying here, David?

• 10:56David Hoffman?

  Yeah, he's saying that it's still kind of retail that is playing in Ethereum that, you know, there's a large amount of ETH. There aren't large amounts of ETH moving on chain, which means there aren't yet big buyers. I guess you could actually interpret this bearishly. That's probably if I was a Bitcoin maxi, I would say like, haha, like institutions aren't buying ETH. And perhaps that's bearish, or perhaps that's an opportunity.

• 11:19Ryan Sean Adams?

  Yeah, absolutely. He goes through a few more hash rate.

• 11:23Ryan Sean Adams?

  Ethereum active addresses. I genuinely like Ethereum active addresses. These are ETH addresses. ETH addresses are almost like bank accounts. And right now, that figure of Ether active addresses has doubled year to date. And is now its all time high. So the bank accounts on the Ethereum network are using the network more than they ever have. We hit all time high on that fundamental metric, too.

• 11:48David Hoffman?

  Yeah, yeah, there's, there's nothing more bullish to me than more and more people using Ethereum as their banking layer. It's supposed to be for.

• 11:56Ryan Sean Adams?

  He goes through, he goes through a number of DeFi users, total locked value and DeFi, all of these things. Stable coins, all of these metrics that we report out. So lots of fundamental reasons to be bullish as well. I saw this report from Fundstrat too, David. So Fundstrat is kind of a group that appears on MSNBC quite a bit. This is sort of a mainstream finance group. And they just put out a price prediction for ETH of over 10K. So it's starting to leak into mainstream finance circles, too. What do you think about this number?

• 12:35David Hoffman?

  Yeah, like I want to know how some of these funds and entities come up with their price predictions. They made a specific prediction of $10,500. I want to know where that 5,000 came or 500 came from.

• 12:46Ryan Sean Adams?

  Yes.

• 12:47David Hoffman?

  But you know, the 10K meme is getting exported out of the inner circles of Ethereum into the greater world of people that are interested in investing in crypto assets.

• 12:57Ryan Sean Adams?

  You know, fair enough. I haven't read the full report, but this slide stuck out at me. So the person who wrote this report said blockchain computing may be the future of the cloud. The future of the cloud? So like, what are we talking about here?

• 13:10David Hoffman?

  I don't know what that means. Oh, man. I would like to know what that individual meant.

• 13:15Ryan Sean Adams?

  So price predictions coming out at over 10K, but it's not clear to me that mainstream finance actually understands what Ethereum is yet, or what Ether as an asset is. They're just, they're just bullish for some reason.

• 13:28David Hoffman?

  If they did understand it, there'd probably be a higher valuation.

• 13:30Ryan Sean Adams?

  Yeah, absolutely. Okay.

• 13:32David Hoffman?

  Aave is a borrowing and lending protocol on Ethereum and just recently released Aave version two, which has a ton of cool new features that makes using Aave even more powerful. With Aave, you can leverage the full power of DeFi money Legos, yield and composability all in one application. On Aave, there are a ton of assets that you can deposit in order to gain yield and all of those same assets can also be borrowed from the protocol if you have deposited collateral. Here you can see me getting a 200 USDC loan against my portfolio of a number of different DeFi tokens and ETH. I'll choose a variable interest rate because it's a lower rate than the stable interest rate option, but I could choose

• 14:13David Hoffman?

  the stable interest rate option if I wanted to lock that interest rate in permanently. One of Aave's V2 features is the ability to swap collateral without having to withdraw your assets, trade them on Uniswap and then deposit them back into Aave. Aave does all of this for you, all in one seamless transaction. So you don't have to repay loans in order to change the collateral you have backing them. Check out the power of Aave at ave.com. That's A-A-V-E dot com. If you want to live a bankless life, you need to get a Monolith DeFi Visa Card. Monolith is a one-two punch of both an Ethereum smart contract wallet and an accompanying Visa card that lets you spend the money that you have in your Ethereum wallet everywhere where Visa

• 14:56David Hoffman?

  is accepted. When you swipe your Monolith Visa card at the grocery store or at a restaurant, it actually makes a transaction on the Ethereum blockchain that spends some of the money you hold in your Monolith wallet. It's insanely cool and it's one of the best tools out there for living a bankless but still normal life. Monolith also offers on-ramp services for getting your fiat money into the world of DeFi. So it's trivial to top up your Monolith card if you ever need to and your deposited money goes straight into your non-custodial wallet. So your money is never held by a centralized intermediary. Because Monolith is native Ethereum infrastructure, the money you hold in your Monolith wallet still has the power of DeFi behind it. Swapping assets

• 15:38David Hoffman?

  on Uniswap or earning yield in DeFi is at your fingertips. Go to monolith.xyz and sign up to get your Monolith Visa card today.

• 15:48Ryan Sean Adams?

  That's market David. Let's get into your releases. So do you want to start with this first one?

• 15:52David Hoffman?

  Yeah, MStable, which is a literally called a meta-stablecoin where, you know, there are so many different stablecoins on Ethereum. MStable is a project that kind of offers a new stablecoin on Ethereum using a basket of other stablecoins on Ethereum, hence the meta. They are launching their MUSD Save, kind of like a vault feature. It's like a high-yield savings account. Pretty cool for people who are trying to access yield in DeFi while also controlling for their own risk.

• 16:19Ryan Sean Adams?

  More in more yield opportunities in DeFi for sure. And have you kept up with the second one? Saddle raised 4.3 million for a slippage-free DeFi trading. That's that's sort of the headline. But Saddle is basically it's a fork of a stablecoin automated market maker, an AMM called Curve. That's really popular, very well used. The Saddle forked some of their code, apparently rewrote the code. What is interesting about this story, do you think, David?

• 16:50David Hoffman?

  Yeah, I don't, I actually don't know the competitive differentiator between Saddle and Curve. I do know that there is plenty of room for more than just one version of a DeFi application. I think that's what Sushi Swap proved out that, you know, not just Uniswap is going to dominate the AMM market. And I think this is the same thing with Curve and Saddle. Saddle's saying like, you know, Curve is great, but I think we can do something in here as well. And there's plenty of space for more than just one protocol to offer the same, same product.

• 17:17Ryan Sean Adams?

  They had a bit of a rocky start with some issues at launch, but we will see how it plays out. Certainly more competition is better for DeFi users. The one thing I'll say on this to you, David, is it does seem like there's this dichotomy for, for many protocols where you have sort of a VC-backed version and a more crypto community-led version, right? And yeah, and so for, from every protocol, you have both of those strategies being deployed. So we'll see how that turns out with Saddle. Loopring has been on a tear lately. This is one of the, the shippiest teams in, in crypto right now. There's constantly shippy shipping.

• 17:56David Hoffman?

  That is, I've never heard that adjective before. I love it.

• 17:58Ryan Sean Adams?

  Oh, never? You've never heard that adjective? I use it all the time.

• 18:02David Hoffman?

  I have never heard shippiest.

• 18:04Ryan Sean Adams?

  All right. Well, what are they shipping?

• 18:05David Hoffman?

  Yeah. So Loopring, an L2 scaling mechanism for Ethereum with AMMs on it, so exchange functionality, and an, and an order-based DEX as well, has put their product, their app into the Google Play Store, you know, not the, actually not, not the most revolutionary thing, you know, we're not, we're not trying to infiltrate Google Play Store. That's not really at the goal of Ethereum. But we do need people to download applications like Loopring, like MetaMask, like Argent on, on people's phones. The difference with this Loopring app is it is a direct integration into a smart contract wallet on Loopring's L2. So people, people who download the Loopring app are

• 18:46David Hoffman?

  having their first interaction with Ethereum on an L2, right? And so to make an Argent wallet, it costs like $40 worth of gas that actually Argent pays because if the user just downloads Argent, they don't have any Ether. So the Argent team pays for that gas to deploy their smart contract wallet onto the L1. And then also transactions on Ethereum. Using Argent are actually more gas intensive because it's a smart contract wallet. We actually just recorded a podcast with Vitalik talking about social recovery and L2. And we go into details about this. That podcast is coming out in a few weeks. But what Vitalik is bullish on is smart contract wallets on the L2. And that's what Loopring has rolled out here today.

• 19:29Ryan Sean Adams?

  This is great news because it means Argent is going to go there next. And so are the other smart contract wallets. Really excited about this. Speaking of being excited, ETH 2 has been going pretty darn well. Like, I don't want to use the word flawlessly, but there hasn't been a hiccup since network launch. When did we launch? Back in December, right? So we're closing in on two months of like it just working well. Danny Ryan.

• 19:57David Hoffman?

  No news is good news at this.

• 19:59Ryan Sean Adams?

  Yeah, I've like almost forgotten that it's up there, right? Things like continuing to accrue new ETH. I don't know, 2.6 billion, something like that total ETH stake. So it's just humming right along. And Danny Ryan put together a fantastic report that will add to the notes that you can go take a look at and see what's what's new there. David, let's talk about this one. We're speaking about rollups in layer two. Optimism has just launched on mainnet with Synthetix. What's going on here?

• 20:30David Hoffman?

  Yeah, the long awaited optimistic flavor of rollups. The one of two flavors of rollups that this whole entire Ethereum ecosystem is bullish on. Get their soft launch on to the Ethereum L1. Synthetix is the team pioneering the usage of this new optimism L1. And so Ethereum is just scaling in all directions.

• 20:51Ryan Sean Adams?

  Look at this graphic, looks like crypto utopia right there. It's just on the horizons with optimism team says, we'll see. Coinbase is doing some much needed infrastructure work. What is this story about?

• 21:03David Hoffman?

  Yeah, Coinbase is famous for going down all the time, especially last bull cycle during 2016 and 2017. Coinbase would crash all the time. I kind of would have figured that they would have fixed this by now, but it turns out Coinbase is continuing to crash all the time. They had three, three plus years to figure this out. Turns out they didn't, but now they just released a statement saying that they are going to quote unquote, "figure this out" by kind of compartmentalizing some of their backend infrastructure. Probably should have done this a few years ago, Coinbase. Like, what were you doing during the bear market?

• 21:36Ryan Sean Adams?

  Well, maybe they are just like surprised by all of the demand, you know, in this bull market. So I guess that's good. It's always a good sign when Coinbase is crashing during the bull market, I guess, for price. I guess, I don't know, question mark. What's going on with Urine here, too? I was told that Urine had a 30K cap, that they weren't going to issue any more tokens, but it turns out they're issuing tokens. Why are they doing this? What are they doing?

• 22:02David Hoffman?

  This is just a proposal, so this is not finalized. However, there has been growing conversation about how to fund Wire's developers, right? And one of the ways that we could do this is by just minting the protocol token. Many other DeFi protocols like Aave have done this. Uniswap has like a $500 million treasury of uni tokens that they can use for development. Wire doesn't have that because it committed to that 30 million, no, 30,000 YFI token cap, which it's now trying to perhaps walk back on. Maybe that $30,000 or 30,000 unit meme is actually not the best thing for the protocol. And especially there is some, some incentive alignment friction between the developers and the token holders

• 22:47David Hoffman?

  that they are hoping this mint can help solve. And so they are, they are just looking to fund development. And personally, I think it's, I think we should absolutely make sure that all Wire developers are correctly incentivized to build for Wire. Just, I think the, my personal opinion is that keeping ourselves locked into that $30,000 hard cap just for the meme is a disservice to the people that are actually adding value to Wire.

• 23:14Ryan Sean Adams?

  So you're not mad about this?

• 23:15David Hoffman?

  I'm not mad about this.

• 23:17Ryan Sean Adams?

  You know, it's funny is fair launches are easy, but like governance post fair launch is hard, you know, is I would think what the community is finding out.

• 23:25David Hoffman?

  It's easy to issue a token. It's hard to build a product.

• 23:27Ryan Sean Adams?

  Right. If if Wi if Wi Fi was trying to be a money like a Bitcoin or Ether, this would be an absolute no. Right. But this is more of a capital asset. And the the truth of the matter is they didn't have a way to fund their protocol development. Reminds me kind of of the the synthetics pivot. Remember, we talked with with with Kane and originally, they were planning to issue synthetics according to the the Bitcoin schedule.

• 23:53David Hoffman?

  Happening every four years.

• 23:54Ryan Sean Adams?

  Happening every four years, just because why? Just because that was

• 23:58David Hoffman?

  Because of me.

• 23:59Ryan Sean Adams?

  That was popular. You thought you had to do that. And then when they finally started thinking about it and scratching their heads, you're like, no, we should be issuing a coin to reward the activity we want in our protocol, which is liquidity. So let's go do that. And it turned out very well for them. So as long as you're not competing as a money, this sort of thing is not necessarily bad. But it is interesting how these communities are governing themselves. David, last thing, we had Lynn Alden on the podcast. Post our podcast, maybe partially in response to some of the questions she raised, she put out a phenomenal piece. I thought it was good anyway, about Ether as an asset. And it's not necessarily that she was bearish, but she felt generally that Ether and Ethereum were not ready for primetime

• 24:42Ryan Sean Adams?

  investment yet would be maybe my take on it. We have a related response. Can you tell us about this?

• 24:50David Hoffman?

  Yeah, when Lynn Alden writes a piece, and she put time and energy into that that piece, the economic analysis of Ethereum. And when I and I do not believe that Lynn Alden was just like contributing to the BTC maxi dogpile on Ethereum. I think that was an open invitation for her to gain more insight and understanding for her own benefit. You know, she put her rationale down onto paper as an invitation for the Ethereum community to respond. And and, you know, she I think she wants to be convinced. She just needs to be convinced. And so I took the time as well as Lucas. And and we also made this open to just the general Bankless Nation community. Community to help contribute. And so we've gone through some of Lynn Alden's arguments and formulated our own responses to them.

• 25:34David Hoffman?

  And I don't think Lynn Alden is anti ETH or anti Ethereum. She is just a macro investor. And let's, let's be real here. The market cap of Ether is $160 billion. That doesn't show up on macro radar. Like, that's, that's small. That's tiny.

• 25:49Ryan Sean Adams?

  Yeah, it's just starting to show up. Absolutely. So where can people find this response, David, at the time that you're, we're publishing this?

• 25:56David Hoffman?

  Yeah, that, this, we are recording this on Thursday. That article, this response is also going out on Thursday. That's today. So for listeners, it was yesterday. You'll be able to find that at newsletter dot banklesshq.com.

• 26:08Ryan Sean Adams?

  All right, man. That's, that's exciting. I'm glad for that to go out. Good. Just continue the dialogue with Lynn, right? All right, news. Goldman Sachs. I've heard of these guys. They're bankers somewhere, right? They're entering the crypto market, quote, soon with a custody play. I feel like I've heard this from Goldman Sachs before, and probably the last time was the, the last bull run. There were murmurs of Goldman, like, opening trading desks and getting into custody. Maybe it's for real this time? It's funny to see banks flooding back into this space.

• 26:39David Hoffman?

  Custody is the low hanging fruit, first stop shop for somebody like Goldman Sachs to get exposure into this world. Just learning how to hold it for their customers is kind of how they get their foot in the door. I, I, I believe it. The, the difference between 2017 and 2020 custody plays is there's actually a lot more opportunity for custody plays. We saw PayPal purchase BitGo a while ago as a custody play. And, and then all the other, like custody plays, all the other protocols and, or not protocols, teams and companies and startups that were custody based got really excited because like, oh, you know, PayPal just bought BitGo. Who else is coming to buy, you know, my company, my, my custody play? And, and I think that's kind of what we are seeing play out.

• 27:22David Hoffman?

  There's a lot more options for companies like Goldman Sachs to just buy a custody play.

• 27:28Ryan Sean Adams?

  I think what may have happened with Bitco is if I recall that deal may have fallen through. I'm not actually sure, but certainly, yeah, certainly PayPal was in talks about buying Bitco. And then something broke down last minute, if I'm recalling correctly. But yeah, I totally agree. Custies makes sense to start from a banking perspective. I have a bit more respect for banks like Fidelity that were also here during the bear market. Goldman to me feels a little bit like a fair market entrant. Well, things are good. We're going to go enter, of course. Whereas Fidelity has been building this stuff since 2014. Anyway, it's good to see some more competition in that area. Speaking of that, the world's largest asset manager is a firm called BlackRock.

• 28:11Ryan Sean Adams?

  They have billions in assets under management, like, excuse me, I said billions. But what I meant was trillions with a T.

• 28:20David Hoffman?

  Trillions with a T.

• 28:21Ryan Sean Adams?

  That's crazy. They just produced some filings, some SEC filings that suggest that they are looking to buy, possibly buy big into crypto, specifically into Bitcoin. Is this a big deal?

• 28:36David Hoffman?

  Yeah, I'm not sure how much speculation this is, or just like reporters or investigators connecting the dots behind BlackRock filings. But what's going on here is apparently BlackRock is doing all the filings that it needs to do in order to compliantly put Bitcoin on the balance sheet. And so, I mean, the timing is fitting, like, there's plenty of mania and excitement about this space. So that would make sense. If BlackRock is putting Bitcoin on the balance sheet, like, there's no better signal. Like, you know, Druckenmiller, that's great, like, you know, Raul Paul, that's great. Like, you know, Ray Dalio talking about Bitcoin, that's great. This is BlackRock. There's no more, like, bigger of an institution after this. Like, this is the top. This is the biggest institution.

• 29:18David Hoffman?

  If they're putting Bitcoin on the balance sheet, like, everyone should be paying attention to that.

• 29:23Ryan Sean Adams?

  Yep, they do not make them any bigger. David, let's switch this. So this is Biden administration stuff. It looks like Janet Yellen is going to become Treasury Secretary, so replacing Steve Mnuchin. And she's given some remarks lately that might get into the agenda here. But let's talk about the first. The first thing is she said that the US must act big on the next coronavirus relief package. What does acting big mean?

• 29:53David Hoffman?

  Money printer go brrr. I'm pretty sure that's what that means. This is pretty expected out of what we expected out of a Biden administration. We always knew that Biden was going to be very favorable towards relief packages, right? They want to put money into the hands of the people. That's kind of, in my opinion, the value prop behind the Democratic Party was that they are pro-relief and they want to get cash into the economy more than the Republicans did. And so this is them fulfilling those promises.

• 30:25Ryan Sean Adams?

  All right. And this Janet Yellen backing it up. And at the same time, she was calling for more money printing, if you will. She was also saying that cryptocurrencies are a concern. What are they a concern for?

• 30:37David Hoffman?

  Terrorist financing. Classic boomer statement out of Janet Yellen here, saying, let's turn on the money printer and get relief into the hands of the people. At the same time, let's also like restrict or stop as much of that money going into Bitcoin. Like, that's kind of what I'm getting at, is they are, the Federal Reserve, the Federal Chair, the US dollar is trying to get printed so it can put itself into the hands of the people. Yet, at the same time, if people just take those dollars and buy Bitcoin with it, that's bad. And so I feel like this is what Janet Yellen is trying to get in front of.

• 31:12Ryan Sean Adams?

  Yeah, it's very difficult to know whether this is coming from like, sort of the state, we, you know, we want to surveil all transactions kind of prong of things, or whether this is just a fear that something like the US could lose its reserve currency status. Maybe both of those things simultaneously. I thought Mike Dudas had a great response to this. On Twitter because it's such a fallacy. This I thought this mostly died in 2015 and 2016. Quite honestly, David, the narrative that my crypto and Bitcoin were only for terrorist activities and money laundering. Like that died way back then because since that time, we produced a ton of data. This is a chain analysis. They actually produce data for big government agencies.

• 31:56Ryan Sean Adams?

  And less than a percent, point three, four percent of cryptocurrency activity in 2020 was criminal in nature. According to their report, that's a whole lot less than cash money in briefcases. Like the US dollar as cash is a far better tool for terrorists and money launderers than cryptocurrency is.

• 32:17David Hoffman?

  Yeah. And this kind of just goes to show that anyone that says like that crypto is used for terrorist financing or just illicit activities has some sort of bias or ulterior motive. Either Janet Yellen is naive and she is just touting off the first statement about Bitcoin that comes to her mind. Or she has ulterior motives, which is protecting the brand and the value of the US dollar. My opinion is it's the second.

• 32:40Ryan Sean Adams?

  We always seem to see David, the same like headwinds and tailwinds coming out of the government. Like some things that are bullish for crypto and some things that are bearish simultaneously. It's interesting to see how that will evolve with this new administration. Coinbase is making moves as well. We're talking about Coinbase earlier. They just purchased Bison Trails. What's Bison Trails?

• 33:01David Hoffman?

  Bison Trails is a node operation service, kind of a, they're also probably going to be massive players in the staking as a service industry, which I guess Coinbase is now gaining exposure to that as well. Bison Trails, if you want to stake your ether using Bison Trails, you can stake your 32 ether with them in a non-custodial fashion. I used to be privy to the details as how that works. I can't, can't do, I can no longer do that. But if you want to stake your ether and also retain custody, but not run your own node, Bison Trails would be for you. They also do nodes and node services for basically all other meaningful blockchains. And now they are owned by Coinbase.

• 33:43Ryan Sean Adams?

  Guys, this is a signal the crypto banks are definitely going to get into staking in a big way. David, let's breeze through these last ones. Soldier Boy is tweeting about NFTs. How exciting is that? Wow, maybe we get Soldier Boy on Bankless at some point. Would we take that interview, sir?

• 34:04David Hoffman?

  I think we would. I think we would, yeah. I mean, I was a big fan of Soldier Boy in middle school, so I'm not going to pass that opportunity up.

• 34:10Ryan Sean Adams?

  All right.

• 34:10David Hoffman?

  I think this just shows the resonance between creators and NFTs. I think the value proposition of NFTs is extremely obvious for creators like Soldier Boy. I think that's the headline.

• 34:20Ryan Sean Adams?

  Yeah, what's so funny is, so this tweet originated from, he asked, like, should I release my own crypto? Or something like that? And people are like, no, don't do that. You'll get in trouble. Remember 2017 when Paris Hilton, blah, blah, blah, all these celebrities tried to release tokens? He's like, oh, okay. And somebody was like, yeah, but you should check out NFTs. And he was like, okay.

• 34:42David Hoffman?

  Obvious answer.

• 34:43Ryan Sean Adams?

  I'm releasing an NFT. So what's going to happen this market is like, you know, we talked so much about fractal patterns and how history rhymes, but it doesn't repeat. Right? So like 2017, all the celebs wanted to release a crypto token. Right. 2021, this bull market is going to be all NFTs, my friend. I think that's how it's going to work.

• 35:02David Hoffman?

  Much stronger product market fit. It just makes so much more sense. We don't need a currency per celebrity. However, celebrities are fine to make art because that's kind of what they do in already.

• 35:12Ryan Sean Adams?

  Yeah, perfectly legal. All right, Pax Gold. So this is a token on Ethereum. They reached over 100 million in market cap. Super bullish on tokenization of all of the things, including gold. And also this last headline, Pornhub just added a whole bunch of other cryptocurrency to their payment options. I guess that's a good thing. I don't know.

• 35:35David Hoffman?

  The tokens that they added, which is what's interesting to me. They added XRP, Ripple, Binance Coin, BNB Coin, and Doge, and also USDC.

• 35:48David Hoffman?

  I think it's going to be the USDC coin that gets used the most. But you know, it's, who knows?

• 35:54Ryan Sean Adams?

  Like, in that order, who knows? Who knows? Who knows, indeed? People just want to get rid of some of their other coins. I guess this is a way to do that.

• 36:01David Hoffman?

  David, I'll trade some XRP for some porn.

• 36:03Ryan Sean Adams?

  You have XRP? That's the bigger headline. Oh, my God.

• 36:07David Hoffman?

  No, if I did, it would be a good trade to trade it for porn.

• 36:12Ryan Sean Adams?

  Well, okay.

• 36:13David Hoffman?

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• 36:58David Hoffman?

  I'm able to make my money do the things I want it to when I want it to. You can buy crypto safely and securely on Gemini with the peace of mind of knowing that your investments are insured and protected with industry-leading cybersecurity. You can open up a free account in under three minutes at Gemini.com/go-bankless. And if you trade more than $100 within the first 30 days after signup, you'll be gifted a free $15 bonus. Check them out, Gemini.com/go-bankless. If you are looking for a product that connects your fiat bank account with DeFi tokens and products, you need to download the Dharma mobile app. Dharma is a non-custodial smart contract wallet

• 37:41David Hoffman?

  and comes with a bridge that connects you right into your bank account. Dharma is the fastest and most efficient wallet between your fiat in your bank account and any token on Uniswap, or even any vault in Yarn. With Dharma, you can get over $25,000 per week into the DeFi universe, and you can do it non-custodially. If you or anyone you know is hot on DeFi and you're trying to get your money into a DeFi investment, Dharma is the place to go. Signing up and going through KYC is an absolute breeze. It took me just under three minutes. And after signing into my bank account via Plaid, I am now just one transaction away from any token that Uniswap has to offer. Go to www.dharma.io.

• 38:25David Hoffman?

  That's D-H-A-R-M-A dot I-O. Download the Dharma app and get yourself unbanked today.

• 38:34Ryan Sean Adams?

  Takes. Let's start with the first one. This is one from a guy named David Hoffman on Twitter. If you should follow that guy.

• 38:40David Hoffman?

  Smart guy. He says that Ethereum is a bet that the future is going to be different.

• 38:45Ryan Sean Adams?

  What do you think he means?

• 38:46David Hoffman?

  Yeah, what does he mean? I don't know. I think my interpretation of this tweet is that Ethereum is a revolutionary piece of technology. And it's doing a little, it's offering an alternative mechanism or vehicle to do almost every single in the previous industry differently. Either a little bit differently or a lot differently. And then it also offers totally brand new things to the table. I think we are, it's obvious to that, to people and to listeners that the world is changing, the world is changing really, really rapidly. And I think in a world that is changing rapidly, Ethereum offers ways to capture that change. Ethereum is a bet that the world is going to be different.

• 39:25Ryan Sean Adams?

  Yeah, definitely. It's probably a good bet. One thing I'd also say here is like, some people think Bitcoin is a bet that the world's going to be bad in the future. Like the world's going to fall apart in the future, right? The whole Bitcoin Citadel idea. Ethereum is not necessarily a bet that the world's going to fall apart. I mean, I think it can thrive and do well if the world falls apart, but it can also do well if we have a roaring twenties era, right? Like, so it's not necessarily a doomsday asset in the way that some paint Bitcoin as, which I think is interesting on that tweet as well.

• 39:58David Hoffman?

  That reminds me of one of my favorite quotes from Amin Soleimani, Bitcoin in times of war, Ethereum in times of peace.

• 40:06Ryan Sean Adams?

  Interesting. There you go. Speaking of Pornhub, I mean, Soleimani.

• 40:12David Hoffman?

  Oh, man.

• 40:13Ryan Sean Adams?

  Breaking. Both global hackers are now called money mechanics. What? What's a money mechanic?

• 40:21David Hoffman?

  This is an outgrowth of Brian Brooks' self-driving banks meme, which is, again, the most boomer meme for understanding DeFi I've ever heard of. Yet I think it's going to go miles with trying to get people's heads wrapped around what the hell this thing going on in DeFi is. And so if we are going to adopt the term of DeFi is self-driving banks, that makes all DeFi money Lego builders, people building on Ethereum, money mechanics. I like it.

• 40:48Ryan Sean Adams?

  Wow, going miles. I like what you did there, David Hoffman. Nice, nice, nice pun job. All right, this is from Spencer Noonan. This is another take that we thought was interesting. He says he has no idea on how to value ETH. Uh, why is that a good thing, David?

• 41:05David Hoffman?

  Yeah, yeah. So I think this is an extension of the triple point asset thesis, right? Where the triple point asset thesis believes that, uh, and if anyone can find an asset that fits into all three asset superclasses earlier than ETH, uh, that would be news to me. Uh, the triple point asset thesis is that that there are three asset superclasses, store value, capital assets, and consumable assets, and Ether is the only asset that fits into all three categories. We've never seen this before, and I think what Spencer Noon here is saying like, he has no idea how to value ETH, because it just breaks all previous paradigms, it breaks all previous models. Uh, and I think I, I requoted this, uh, this tweet and said, you know, valuing ETH breaks the calculator. Uh, I think it's bullish that we don't know how to value ETH. That's that, to me, that just means that the sky's the limit.

• 41:51Ryan Sean Adams?

  Yeah, there are people have put it this way, like assets like Bitcoin and Ether, they can be priced, but not valued. So ultimately, it is this pricing, supply and demand mechanic. And what is the, uh, the top on these assets? It's a big question mark. We can only guess.

• 42:08David Hoffman?

  There are no top.

• 42:09Ryan Sean Adams?

  All right. Um, David, this was a really good take. This is kind of a tweet and also an article from Josh Stark and Evan Van Ness. So every year they do this. What do they do every year?

• 42:20David Hoffman?

  They give us a recap of Ethereum in that year. It's one of the most valuable pieces of just, uh, just articles that comes out every single year. If you want to get reminded what's happened in Ethereum in this last year, which, I mean, there's a ton. Uh, Josh and Evan, they always produce this article. It's always a nice recap of the year in Ethereum.

• 42:38Ryan Sean Adams?

  Yeah, here's my takeaway. This was their first point. They had four points, but the, the first point was interesting is bigger than Bitcoin. So they made the statement that Ether, Ethereum specifically eclipsed Bitcoin, the network, adds the blockchain with the most valuable block space, and they brought the data to prove that total transaction volume on Ethereum for the first time in 2020 exceeded that of Bitcoin. So that means, uh, transaction settlements as denominated in US dollars. So settlements of Ether certainly helped that, and all of the Defi assets, also stable coins, were a big part of that story. So more value is getting settled on Ethereum than versus Bitcoin now for the first time.

• 43:22Ryan Sean Adams?

  And that that line between them, kind of that gap between them continues to increase in accelerated way. Also, daily transaction volume. So this is revenue essentially. So this is how much are people willing to pay for block space essentially? Bitcoin has always been higher than Ethereum, like always. People were more willing to pay for Bitcoin blocks versus Ethereum blocks. And now that's changed in 2020. So for the first time, people are, there's greater demand, greater value and fees being generated from Ethereum versus Bitcoin. It's funny that that was a, that that's been a metric that Bitcoin Maximo specifically had talked about like forever.

• 44:06Ryan Sean Adams?

  Fee generation, that proves that your block space is valuable. Yeah. How much fees are you generating XRP or like, you know, Bitcoin Cash or whatever blockchain. Well, now Ethereum is generating more fees.

• 44:19David Hoffman?

  There's a pretty decent argument that could be made that the amount of fees that your blockchain pulls in relative to its block space is perhaps the number one metric that indicates the hardness or the soundness of the money on top of it.

• 44:34Ryan Sean Adams?

  Yeah, absolutely. And of course, this is an important metric for Bitcoin in the future because its security will ultimately depend on the fees it generates from its block space. So a flipping, I suppose, from a network perspective, from a block space perspective this year, but we have not seen a flipping in asset value in market cap of Bitcoin versus Ether. And we'll see if that plays out in the future. Some people believe it could play out this cycle. I'm not sure. What do you think, David?

• 45:06David Hoffman?

  Oof, this cycle would be tough. I would be surprised. However, I would be pleasantly surprised.

• 45:13Ryan Sean Adams?

  All right. This is from Hayden Adams. Uniswap is doing 2% of the New York Stock Exchange. That seems to be the new.

• 45:23David Hoffman?

  2% of the volume specifically.

• 45:24Ryan Sean Adams?

  The volume specifically. And he asked the question, I love this. I love this energy from Hayden. Come on the podcast, Hayden. He asked the question, when 100%, right? So like.

• 45:37David Hoffman?

  Will Uniswap match the New York Stock Exchange in volume?

• 45:41Ryan Sean Adams?

  Dude, to me, it's only a matter of time.

• 45:43David Hoffman?

  It's only a matter of time. That's not that far away.

• 45:45Ryan Sean Adams?

  Uniswap may not be the category winner here. Like, that also remains to be seen. But if it's not Uniswap, then it's going to be some DeFi, DeFi protocol that does. It's, it's, it's, it's coming this decade.

• 45:58David Hoffman?

  Mm hmm. In, in this cycle, maybe Uniswap doesn't match the New York Stock Exchange in volume, but I bet you with much more certainty that all exchanges on Ethereum do, totally. Like, if you include Curve and Sushi Swap and all the other AMMs, I bet you that definitely breaches 100% of the volume on the New York Stock Exchange.

• 46:20Ryan Sean Adams?

  There you go. Prediction. Was that including your predictions, David, for 2020?

• 46:23David Hoffman?

  It is now.

• 46:24Ryan Sean Adams?

  21? All right, there you go. You heard it here. The last question, we'll, we'll end on this with takes and then we'll get to what we're both individually excited about. The question of have we earned this all-time high with Ethereum right now? Have we earned the all-time high with, with Bitcoin? This, this comes from a, a quote that Vitalik made near the, the apex of the bull market in 2017.

• 46:50David Hoffman?

  Yeah, December 12th, 2017. Yeah, right before all-time highs.

• 46:54Ryan Sean Adams?

  Yeah, he said, "Market cap just hit half a trillion dollars today, but have we earned it?" And his implication was, "No, we haven't earned it. There's a lot of vapor here." The question on everyone's mind, I think, is this time, as we're seeing the market cap exceed this, has crypto earned it? What's your answer to that?

• 47:14David Hoffman?

  Yeah, I mean, i- if something has earned something is always a subjective question. Or, yeah, and we'll, we'll obviously take a subjective answer. One thing is, is worthy of noting is that when Vitalik tweeted that in December of 2017, there was nothing that we do on a daily basis today back then, right? There wasn't even Maker Dow. Maker Dow wasn't even launched at that time. There was no DeFi. There was CryptoKitties, and then there were ICOs. So it was obvious that we did not earn it back then. I think it's totally justifiable to say that we have earned it. We're actually, the crypto market cap is actually 2X higher than what Vitalik said. Vitalik said half a trillion. We're, we're above a trillion dollars right now.

• 47:55David Hoffman?

  But absolutely, we've earned it. Yeah, totally. Like, DeFi is a real product. It's got product-market fit. And Bitcoin, we don't even need to talk about Bitcoin. Like, money printer go brrr means that Bitcoin is justified.

• 48:06Ryan Sean Adams?

  There's no DentaCoin this time around. There's no Bitconnect this time around. It feels much more healthy. But I gotta say, David, I'm gonna be looking for that tweet from Vitalik this cycle too, because he basically called the top last cycle in December, because by January, everything was on kind of the decline, January, February.

• 48:25David Hoffman?

  That's exactly right. Yep.

• 48:27Ryan Sean Adams?

  All right, David, let's get to this. What are you excited about, my friend, this week?

• 48:32David Hoffman?

  So one of my favorite podcasts that actually has taught me a ton about just finance and economics before I got into the realm of crypto was the Planet Money podcast. And they just released a podcast that was a rerun of a podcast that they'd done before. But the reason why they re-released this podcast was because the Biden administration just got elected. And people wanted to ask the question, or get the answer to the question, how are they funding all of their COVID relief mechanisms, right? The Biden administration has a ton of relief mechanisms, a ton of money going out. And so Planet Money put out this rerun of this, what the hell is MMT podcast that they produced, I think in 2017, 2018. And so like, this is just

• 49:14David Hoffman?

  an example, kind of in the same way that we look out for examples of crypto breaking into the mainstream. MMT, Modern Monetary Theory, the theory that the central bank or the currency issuer, which is the United States, can't be insolvent because they can print new money. The MMT is making is breaking its way into the mainstream. I'm excited to see how that lands with people. Like, how are people going to integrate MMT into their brains now that the Biden administration is just like, you know, making it rain COVID relief all over the United States?

• 49:44Ryan Sean Adams?

  Yeah, anytime people start thinking about money, I think is definitely bullish for Bitcoin and Ethereum and for crypto in general. And nothing like receiving a $2,000 check to start thinking about where the source of this comes from. And then, like, what actually is money, the nature of money? So I definitely agree. That's cool. What else are you excited about?

• 50:09David Hoffman?

  Yeah, the other thing I'm excited about is this last week, we saw optimism roll out on mainnet Ethereum. We were seeing a loop Roll out their smart contract wallet on their L2. We obviously, there are over 2 million ETH in the deposit contract, over $2 billion committed to the future of ETH2. And that's, that's all part of proof of stake. So many Ethereum, anti Ethereum narratives are just getting the, the last nails and just pounded into the coffin. Like Ethereum 2 is shipping, Ethereum is scaling, proof of stake is here. That's only going to continue and especially as so much new attention comes into this space. Like they aren't, they aren't going to be thinking like, what is the execution risk of Ethereum 2.0? Because it's so close, right?

• 50:52David Hoffman?

  It's the, and all the other commitments that Ethereum as an ecosystem and as a technology has committed to are being fulfilled. And so the, these new people who are trying to get a grasp for what the hell is going on in the space. Aren't ever going to go through that, will Ethereum actually work phase? They're, they are going to see it working and, and delivering as promised. And that's got me really excited.

• 51:14Ryan Sean Adams?

  Yeah, absolutely. A lot has been delivered during this bear market on Ethereum that like the previous bull market, previous cycle. We didn't know for sure whether, whether this stuff was going to come through or not. So well positioned for sure.

• 51:28David Hoffman?

  Ryan, what are you excited about?

• 51:30Ryan Sean Adams?

  I'm excited about a new meme or a new narrative. So, you know, you were talking about.

• 51:36David Hoffman?

  Ryan's cooking up a meme, boys.

• 51:38Ryan Sean Adams?

  Cooking up a meme, get ready. You were talking about like a lot of the FUD. There's one last sort of fear.

• 51:51David Hoffman?

  Hang on, Ryan, sorry, Ryan. Sorry, let's start you over because my internet was, was unstable. You were just super robotic. You were saying you were talking about, and then I lost you.

• 52:01Ryan Sean Adams?

  Okay. Do you want to just ask me the question again?

• 52:04David Hoffman?

  Yeah, sure. Ryan, what are you excited about?

• 52:08Ryan Sean Adams?

  Excited about a new meme, my friend. I'm cooking up a new meme.

• 52:13David Hoffman?

  Ryan's got a meme coming.

• 52:14Ryan Sean Adams?

  Yep, memes in the oven. We'll see if it takes or not, you know, who knows? But you were talking about the fear, uncertainty and doubt with Ethereum and how a lot of that's dissipated. There's one FUD point remaining, and that is around Ether, the asset. So people still like to say, yeah, Ethereum is great, but Ether, the asset, won't accrue any of the value of Ethereum, right? So I think that narrative is going to shift. I was reading Danny Ryan's point, which we post about the roadmap for ETH2 that we mentioned earlier, and it made me think of the positioning for the roadmap for Ether, the asset, right? So we talk so often that there's a roadmap for Ethereum, the network,

• 52:59Ryan Sean Adams?

  but there's also a roadmap for Ether, the asset, and here's how you can understand it. Three words: bond, burn, bend. We got our three Bs, all right?

• 53:09David Hoffman?

  Three Bs. Tell us about them.

• 53:11Ryan Sean Adams?

  Bs. Okay, 2020 was bond. This is the release of staking. This is Ether as an internet bond. This turns Ether into a productive, yield-bearing instrument. 2020, bond, okay? 2021, burn. We are going to be releasing EIP 1559 very likely in 2020. That is Ethereum's scarcity engine. That means all of this block space that's so highly valued and generating fees, a portion of that gets burnt every single transaction. A portion of ETH gets burnt, gets taken out, out of circulation, like gone from existence.

• 53:52Ryan Sean Adams?

  So what we're actually going to see is some disinflationary pressure on Ether as an asset. It literally becomes more scarce every time Ethereum is used. 2021, burn. So the last is bend, and bend comes in 2022. So that is where Ethereum reduces its issuance from about 4.5% to 1%, and that could even...

• 54:18Ryan Sean Adams?

  Go disinflationary if we're able to burn more ETH every year. So that happens when the proof of work system merges with the proof of stake system. ETH1 merges with ETH2 and then all of the issuance in order to power the economic security of proof of work gets cut off, is no longer needed. And the more efficient economic security of proof of stake kicks in fully. And you get something close to 1% issuance. So those three things, 2020, we saw the bond. 2021, we're going to see the burn. And in 2022, we're going to see the bend of Ethereum issuance. I think that is a narrative that maybe has legs, the three Bs,

• 55:02Ryan Sean Adams?

  but is certainly helpful to understand the asset roadmap for Ether moving forward. Guys, this has been a fun roll up to do with you. Of course, risks and disclaimers, none of this was financial advice. Crypto is risky, ETH is risky, so is DeFi.