Speaker 1: Hello, and welcome to another episode of the Mark Moa
Speaker 1: show where we talk about the decentralized revolution each and
Speaker 1: every week, talking about the way the world is changing,
Speaker 1: of course as we look at it through the lens
Speaker 1: of politics, finance, and technology, and there's no shortage of
Speaker 1: things to talk about as the world is moving really
Speaker 1: really fast. Of course, maybe, man, all three are just
Speaker 1: so important. That's why we talk about all three. But
Speaker 1: we're witnessing the first sovereign debt crisis in about a
Speaker 1: hundred years, and so this super inflated you know, debt
Speaker 1: bubble is collapsing. Of course, the Federal Reserve is restricting
Speaker 1: the monetary supply by raising rates. Um. They came off
Speaker 1: of their easing their monetary easy program to do monetary tightening,
Speaker 1: and it's causing problems all over the world in every area,
Speaker 1: from uh yeah, from politics, like where now people can't
Speaker 1: afford their debt and so we want, you know, the
Speaker 1: president one to forgive student loans, and now we need
Speaker 1: to raise taxes and then we have to offset people's
Speaker 1: expensive energy bills. Um. So yeah, politics, and of course finance,
Speaker 1: where we have the stock markets crashing, the cryptocurrency markets
Speaker 1: are crashing, and then of course we have technology which
Speaker 1: is trying to kind of offset and change all this
Speaker 1: and it is a wild world if you just tune
Speaker 1: it in. Thank you, make sure to tune in with
Speaker 1: me each and every week at the same time, at
Speaker 1: the same channel. You can put a reminder in your
Speaker 1: phone so you don't miss out, and of course always
Speaker 1: feel free to catch me on the podcast. If you
Speaker 1: miss me, just search Mark Moss on your favorite podcast player.
Speaker 1: All right, so, uh, we have been talking about for
Speaker 1: a good part of this year. I mean, we talk
Speaker 1: a lot about all three of those topics. But of
Speaker 1: course the financial markets have been in turmoil, and specifically
Speaker 1: the cryptocurrency markets have burning turmoil going back until about
Speaker 1: May of this year. Mayo where we saw, you know,
Speaker 1: really things start to aching a turn for the worst.
Speaker 1: Of course, November one was kind of the high water
Speaker 1: mark for cryptocurrencies. That's where bitcoin, ethereum, etcetera. Had their
Speaker 1: their their all time highs. And of course that is
Speaker 1: when the Federal Reserve said that they were going to
Speaker 1: start raising rates. Now, the Federal Reserve is not trying
Speaker 1: to sneak up on anybody. A lot of times people
Speaker 1: are a lot of people, I should say, are spending
Speaker 1: a lot of time trying to figure out what the
Speaker 1: feed is gonna do next, what they're gonna what, what
Speaker 1: they're really saying. They're trying to read between the lines,
Speaker 1: so to speak, trying to guess what they're doing. The
Speaker 1: Central Banks, the Federal Reserve is not trying to trick you.
Speaker 1: They're not trying to sneak up on you. As a
Speaker 1: matter of fact, they're trying to tell us well in
Speaker 1: advance what they're doing so we can all be prepared
Speaker 1: for this. And so all you gotta do is watch
Speaker 1: watch their news press releases, you know, watch their meetings,
Speaker 1: look at the notes, the minutes that come out after that,
Speaker 1: and they're helling you. All right. So they told us
Speaker 1: back in November that they were going to start raising
Speaker 1: rates and going into quantitative tightening. Now, if you haven't
Speaker 1: been following along, if we just rewind the clock a
Speaker 1: little bit more, you remember in two thousand twenty, specifically
Speaker 1: March of two thousand twenty, the entire world stopped, or
Speaker 1: more specifically, the governments of the world shut the world down,
Speaker 1: uh specifically shutting down businesses, closing businesses, firing workers, and
Speaker 1: so much more over this whole pandemic situation. Um. And
Speaker 1: so when that happened, of course, businesses that have been
Speaker 1: in business for decades, multiple decades, multiple family generations were
Speaker 1: literally forced to close out of business. And so when
Speaker 1: the economy screeches to a halt, then earnings go down.
Speaker 1: So then you would expect stocks to go down, which
Speaker 1: is exactly what happened. The stock markets crashed at a
Speaker 1: at an alarming pace, dried up all the liquid e
Speaker 1: that and everything just froze up of course because they
Speaker 1: shut it down. Of course, then the Federal Reserve had
Speaker 1: to leap into action and start injecting money, injecting liquidity
Speaker 1: to get the markets moving back again. And then, um,
Speaker 1: the reason why I kind of go backwards into that
Speaker 1: story because then the Federal Reserve, which is doing this
Speaker 1: monetary easy, which is lowering interest rates. Remember when they
Speaker 1: lower interest rates, people take on more debt. Money is
Speaker 1: created through debt, so it's not like the Fed pumps
Speaker 1: and more dollars they create they lower interest rates. We
Speaker 1: take on more debt by houses, cars, boats, etcetera. And
Speaker 1: as that money is created in the ecosystem, it starts
Speaker 1: slashing around inside of there and then the reason why
Speaker 1: I go back to that, like I said, is because
Speaker 1: the FED said, um, you know, we're not thinking about
Speaker 1: raising rates. Then he came out like a month later
Speaker 1: and said we're not even thinking about thinking about raising rates.
Speaker 1: And what that did is that forecast to the markets that, hey,
Speaker 1: the Fed's gonna hold this easy monetary policy for a while.
Speaker 1: Let's go, let's run this thing up. And of course
Speaker 1: financial assets caught a bid. You saw houses jumping through
Speaker 1: through to new all time highs, all the stocks making
Speaker 1: new all time highs. Um. You know, I couldn't get cars, cryptocurrencies,
Speaker 1: et cetera. And so when they forecast to the market
Speaker 1: that game on, let's go, things took off. And then,
Speaker 1: of course, like I said, in November, they said, hey,
Speaker 1: we're gonna start pulling back. And so first we saw
Speaker 1: cryptocurrency start selling off. So Bitcoin and ethereum made their
Speaker 1: all time high right after the announcement and started selling
Speaker 1: off about a week or two later. On how the
Speaker 1: exact chart in front of me. A week or two later,
Speaker 1: we saw the Nasdaq, which is the tech stocks, start
Speaker 1: selling off UM and then UM, I think it was
Speaker 1: January two when the SMPI started selling off, and then
Speaker 1: of course finally the FED came through with what they
Speaker 1: said they were going to do in March of twenty two,
Speaker 1: they actually did start raising rates. Now, the reason why
Speaker 1: that's important to what I'm to say is because this
Speaker 1: has set off this entire chain reaction of market crashes.
Speaker 1: And we'll talk about the cryptocurrency space, but that's where
Speaker 1: it started. And the reason why is because when when
Speaker 1: the FED puts more dollars into the ecosystem, things take off,
Speaker 1: and when they suck them out, everything crashes. Some things
Speaker 1: are more susceptible to others. So the more riskier the
Speaker 1: assets they go up faster, they crash faster. The more old, secure,
Speaker 1: stable assets go up less and slower, and they also
Speaker 1: fall less and slower. The problem that we also have
Speaker 1: is that as these markets take off so fast, the
Speaker 1: problem is how do we how do we keep up
Speaker 1: with that? You and I as earners, you know we're
Speaker 1: we're working for our wages, we're trying to save them.
Speaker 1: But prices are going up so fast. We're getting priced
Speaker 1: out of homes, we're getting priced out of the cars
Speaker 1: we want to buy. We can't go out to eat
Speaker 1: or take vacations anymore. How do we keep up with that?
Speaker 1: And so in order to keep up with that, we
Speaker 1: have to also take on more risk, and then we
Speaker 1: start using things like leverage. So a lot of people
Speaker 1: were leveraging their assets, and that looks really good when
Speaker 1: things are going really good and you grow much faster.
Speaker 1: But then when things go bad, unfortunately, you unravel much faster.
Speaker 1: And so what we saw is in the cryptocurrency space,
Speaker 1: in the financial space, founders, investors, etcetera. Used massive amounts
Speaker 1: of leverage in order to grow, and so they look
Speaker 1: like geniuses. They look they looked amazing, Like Sam Bankman
Speaker 1: freed from ft X. Within three years, he built this
Speaker 1: thirty million dollar company because he took the most risk,
Speaker 1: He gambled the most, he used the most leverage. He'd
Speaker 1: looked like a genius until everything came crumbling down. And
Speaker 1: that's exactly what happened. So we saw in UM about
Speaker 1: May of two thousand twenty two, after things had been
Speaker 1: starting to wind down, we saw potentially maybe the first
Speaker 1: really really really big domino to go down, which was
Speaker 1: a stable coin, terror Luna. We've covered it at length.
Speaker 1: If you want to figure that out, go back into
Speaker 1: the archives back into about May and you can see
Speaker 1: me talking about that. But as this algorithmic stable coin
Speaker 1: which was never going to work, I talked about it
Speaker 1: extensively before all pegs are meant to be broken, and
Speaker 1: so of course it was going to come down. It
Speaker 1: just needed the liquidity, it needed the right environment to
Speaker 1: come down, and that's what happened, which then brought down
Speaker 1: a whole chain reaction. Like I said, so we saw
Speaker 1: that come down, and then we saw you know, Tara
Speaker 1: Luna come down, an anchor broto Call come down, and
Speaker 1: then we saw Voyager come down, and then Celsie has
Speaker 1: come down, and on and on and on, and it's
Speaker 1: finally it starts with the smaller ones and then it
Speaker 1: scales up to bigger, bigger, bigger, bigger, bigger, and then
Speaker 1: it's now taken down f t X and now the
Speaker 1: whole world is taking notice. And I believe that it's
Speaker 1: doing two things. It's doing to two big things that
Speaker 1: you need to be aware of. One, it's showing the
Speaker 1: difference is between bitcoin and crypto why people say bitcoin
Speaker 1: not crypto. It's also I believe, going to push off
Speaker 1: a whole wave of regulations that is going to completely
Speaker 1: change the cryptocurrency landscape. And whether you think so or not,
Speaker 1: you need to at least understand where I'm coming from,
Speaker 1: because you need to understand the risks. All Right, So
Speaker 1: I got lots of cover. You don't want to miss
Speaker 1: what I'm gonna be talking about. If you're just tuning in,
Speaker 1: you're listening to the Mark Mo Show talking about how
Speaker 1: this f t x uh fiasco will change things moving forward,
Speaker 1: don't go away. I'm gonna back right back in a minute.
Speaker 1: All right, welcome back. If you're just tuning in, you're
Speaker 1: listening to the Mark Mo Show, We're talking about how
Speaker 1: the Federal Reserve, by tightening the monetary supply, kicked off
Speaker 1: an entire domino effect that's rippled through the financial markets,
Speaker 1: through the cryptocurrency markets, and I believe is going to
Speaker 1: change the face of the cryptocurrency markets as we know it.
Speaker 1: And so let's keep going here. So, as I said,
Speaker 1: we kind of had this domino effect Harry Luna went down,
Speaker 1: which then was Voyager, and then with Celsius and on
Speaker 1: and on and on. It starts small and it gets bigger, bigger, bigger, bigger, bigger,
Speaker 1: and then f t X, which was the savior. F
Speaker 1: t X jumped into build everybody out, and the media
Speaker 1: was painting them as the darlins of the space, the
Speaker 1: savior of the space. They went down, and the reason
Speaker 1: why is because they look like a genius using all
Speaker 1: this leverage. But the leverage is what unwound them. Now
Speaker 1: we have this UM. It's brought it to the forefront.
Speaker 1: It's all over mainstream media, it's on every single news outlet.
Speaker 1: I've talked about it extensively here. And now it's doing
Speaker 1: two things. So we're gonna talk about one. It's highlighting
Speaker 1: the big, big difference that bitcoin and UM generally cryptocurrencies
Speaker 1: are not really the same thing at all, and so
Speaker 1: people are starting to wake up to that. And then
Speaker 1: the second thing is I believe it's going to really
Speaker 1: push regulations to the forefront and it's going to change
Speaker 1: the face of cryptocurrency as we know it. So let's explain,
Speaker 1: or let's explore these two things that I'm talking about here.
Speaker 1: So the first thing is we'll talk about UM. Why
Speaker 1: you might hear me and other people say bitcoin not cryptocurrency,
Speaker 1: and so we're not saying that bitcoin is not a cryptocurrency,
Speaker 1: but what we're typically saying is when I'm talking about something,
Speaker 1: I'm talking about bitcoin, and it doesn't apply generally to
Speaker 1: all the other twenty thousand cryptocurrencies out there, And so
Speaker 1: what are we talking about? So first of all, what
Speaker 1: is crypto currency? Well, crypto being short for cryptography, all right,
Speaker 1: So cryptography is a way to encrypt things, a way
Speaker 1: to secure things. Right. So, up until I believe the nineties,
Speaker 1: cryptography was illegal. The United States said it was banned.
Speaker 1: It wasn't allowed to be exported under what they considered munition.
Speaker 1: So it was considered like a security um US security
Speaker 1: breach if we would ship that overseas, and so that
Speaker 1: went all the way to the Supreme Court. I believe
Speaker 1: it was under a case um by P G. P.
Speaker 1: Pretty good. Um, I forget the guy's name. I didn't
Speaker 1: prepare this part. I'm talking off the top of my head.
Speaker 1: But basically they said, hey, this is cryptography. The the
Speaker 1: the Department of Justice brought this suit against him and
Speaker 1: it went all the way to Supreme Court. And when
Speaker 1: he went to the Supreme Court, he had printed out
Speaker 1: the code. The code is software, uh, and they printed
Speaker 1: it out on paper and then they brought like a
Speaker 1: stack of paper and put it on the desk, and
Speaker 1: the Supreme Court's like, well, that's speech, and so that's
Speaker 1: protected under free speech. And so cryptography has a sense
Speaker 1: flourished since then, and bitcoin was this new technological revolution
Speaker 1: which used cryptography to secure the transactions. So we can
Speaker 1: secure our private keys, we can secure our bitcoin by cryptography,
Speaker 1: and that way, unless I have the key, no one
Speaker 1: else can get access to it. So when you hear
Speaker 1: about like you know, the government is going to seize
Speaker 1: your bitcoin, um, they can't, um not if it's not
Speaker 1: unless they can get a hold of your key, your
Speaker 1: private key, because it's cryptographically scared. So then you call
Speaker 1: it well cryptography or crypto and then currency. So bitcoin
Speaker 1: is a lot of things, one of which maybe the
Speaker 1: killer application of it is to kind of reinvent money.
Speaker 1: And so you take money or coins and then you
Speaker 1: have cryptography, you get cryptocurrency. Now there's twenty thousand other
Speaker 1: so called cryptocurrencies um, and maybe they use some form
Speaker 1: of cryptography, but they're not all meant to be currencies.
Speaker 1: So first of all, there's a big difference there. But
Speaker 1: like I said, we're typically saying crypto or bitcoin, and
Speaker 1: we're talking about bitcoins specifically and not crypto or cryptocurrency.
Speaker 1: And so let's dig in a little bit more into that.
Speaker 1: So the first thing is that bitcoin is, like I said,
Speaker 1: it was a new new invention, a technological revolution that
Speaker 1: gave us a big, big breakthrough. And the breakthrough was
Speaker 1: instead of having centralized control centralized databases, we now have decentralized.
Speaker 1: And so as the Internet grew um from the nineties um,
Speaker 1: it was very hard to get on the Internet at first,
Speaker 1: and then in the late nineties and the early two thousands,
Speaker 1: when I started my first Internet business, it was very
Speaker 1: hard to start Internet business because you had to run
Speaker 1: your own server. And so the Internet wasn't really going
Speaker 1: to scale if it was that hard where everyone had
Speaker 1: to set up their own server. And so we started
Speaker 1: getting these cloud hosting services and so then we have
Speaker 1: Amazon Web Services and Google, etcetera. Which allowed us discovered
Speaker 1: the quickly, but it created the centralized databases. On top
Speaker 1: of it. You have these companies like Experience, which is
Speaker 1: the credit reporting agency that runs their own database, or Facebook, etcetera.
Speaker 1: But the problem is is they control those databases. Your
Speaker 1: bank JP, Morgan Wells, Fargo, Bank of America, etcetera. Runs
Speaker 1: a database that keeps track of all their customers accounts
Speaker 1: and deposits, right and so um those are essentially now
Speaker 1: if Wells Fargo wanted to, they could say, well, Mark,
Speaker 1: you don't have money in your accounts anymore, or the
Speaker 1: u S could just see, you know, tell them to
Speaker 1: freeze your account. Um, it happens all the time. When
Speaker 1: you don't pay your taxes, for example, it could freeze
Speaker 1: your accounts or just take money out of your accounts.
Speaker 1: And so whoever controls that database or we'll call it
Speaker 1: a ledger, has control. But what bitcoin did is that
Speaker 1: allowed us to have a decentralized database, or have thousands
Speaker 1: or hundreds of thousands or millions of databases that so
Speaker 1: each person could control their own database as opposed to
Speaker 1: one single entity. That was the revolution d centralization, all right.
Speaker 1: The problem is that that was the big trend, that
Speaker 1: was the big breakthrough, That was the big revolution, and
Speaker 1: a lot of these other cryptocurrencies have jumped on to
Speaker 1: try to pretend like they have that, but they haven't
Speaker 1: been able to achieve it. All right, So that is
Speaker 1: the big difference here. Now, some of the big differences
Speaker 1: that we would say would be um sort of like
Speaker 1: I used the illustration on my YouTube channel um talking
Speaker 1: about how just because things sound similar doesn't mean they are.
Speaker 1: So we could look at I used the example of
Speaker 1: like beyond meat, which was this big darl and it
Speaker 1: was gonna gonna make meat healthier, but instead they have
Speaker 1: like twenty or thirty ingredients, which many of them are
Speaker 1: very very unhealthy for you, containing heavy amounts of steed
Speaker 1: oils and things like that. And so you might say, well,
Speaker 1: beyond meat is like meat, but meat is just supposed
Speaker 1: to be like from an animal, just one ingredient, right,
Speaker 1: it's just a cow, So beyond meat isn't really meat.
Speaker 1: We might also say gold. Gold is a form of metal,
Speaker 1: but it's a lot different as chemical different chemical mineral
Speaker 1: breakdown of aluminum or steel or cromaley or platinum, pladium, silver,
Speaker 1: et cetera. Right, so gold, they're all metals, but it's different.
Speaker 1: And so bitcoin is just different than all the other cryptocurrencies.
Speaker 1: One of the big things is that bitcoin was created.
Speaker 1: It's a piece of as a piece of software. The
Speaker 1: software was released into the public for people to go run,
Speaker 1: and the bitcoin was created by a single issuer. As
Speaker 1: anybody can go get a computer plug into the software
Speaker 1: and can create bitcoin for themselves today just like they
Speaker 1: could from the very beginning. Unlike most of the cryptocurrencies
Speaker 1: and including your favorite top big ones, the number two ethereum,
Speaker 1: you know, top ten cardano. Uh, those coins were created
Speaker 1: by a group of founders who enriched themselves and kept
Speaker 1: a good majority of those coins, and then they released
Speaker 1: it open to the public. All right. So that's a
Speaker 1: big difference. Um, there was no Bitcoin had no issuer.
Speaker 1: So it's that's why the SEC considers it a commodity,
Speaker 1: which will get more into the regulatory part and a
Speaker 1: little bit all right. Now, the other thing that we
Speaker 1: need to understand that makes bitcoin a lot different than
Speaker 1: the other twenty thousand cryptocurrencies is what backs it? All right.
Speaker 1: A lot of people will say, well, what backs cryptocurrency?
Speaker 1: What gives it value? So I want to talk about that.
Speaker 1: So I want to go through more. If you're just
Speaker 1: tuning in you listening to the markma Show, or talk
Speaker 1: about the ft X blow up and how it's going
Speaker 1: to change the cryptocurrency space overall, I'm highlighting some of
Speaker 1: the difference between bitcoin and the rest of cryptocurrency, and
Speaker 1: we're gonna talk about the regulations and how the whole
Speaker 1: industry will change. I got a lot to cover. You
Speaker 1: don't want to miss it. I'll be back with more
Speaker 1: in a minute, so don't go away, all right, Welcome back.
Speaker 1: If you're just tune in, you're listening to the Mark
Speaker 1: Mo Show. We're talking about how the financial system started
Speaker 1: melting down. It created a collapse in the crypto industry.
Speaker 1: The collapse of ft X brought a bunch of things
Speaker 1: to the forefront, and how it's changing the cryptocurrency space,
Speaker 1: probably for good. All right. So I'm highlighting some of
Speaker 1: the differences between bitcoin and crypto and then we'll talk
Speaker 1: about how the f t X and what I think
Speaker 1: regulations will come and how that will change. So, uh,
Speaker 1: going back to bitcoin, what we're talking about, how it's
Speaker 1: just different, and the reason why it's different is because
Speaker 1: or understanding why it's different leads to the next part,
Speaker 1: which is the regulatory side of things. And so commodities
Speaker 1: are typically things brought from the ground that could be
Speaker 1: brought from the ground anywhere in the world and they
Speaker 1: would all be fungible. So if I bought a piece
Speaker 1: of dirt in Iowa or in Kenya, Africa, or in
Speaker 1: the Ukraine. With that dirt, I could grow wheat and
Speaker 1: didn't matter where I grow that wheat in the world,
Speaker 1: wheat is wheat, So anyone can go buy dirt, grow wheat,
Speaker 1: and wheat the same. I could go buy a piece
Speaker 1: of dirt, and I could mine for gold in Mexico
Speaker 1: or in Africa, and doesn't matter. The gold is still gold.
Speaker 1: I could buy a piece of dirt and and drill
Speaker 1: for oil, whether in California or Saudi Arabia, and the
Speaker 1: oil's oil. And anybody can go buy the land and
Speaker 1: mine for the gold or the oil, or for the
Speaker 1: grow the wheat, and it's all the same. And so
Speaker 1: bitcoin is the same, where anybody can go buy a computer,
Speaker 1: plug it into the network, and they could bring bitcoin
Speaker 1: into the ecosystem, so it's a commodity. There's no central
Speaker 1: issue where nobody issued oil, wheat, or gold, and nobody's
Speaker 1: issuing bitcoin either. The difference with other cryptocurrencies is that
Speaker 1: they do have an issuer. So your your favorite cryptocurrencies
Speaker 1: have all been pre mind, So about seventy of all
Speaker 1: the ethereum and existence was pre mind. So when they
Speaker 1: created it, they created the tokens and gave them to
Speaker 1: themselves and their investors, which was themselves, Um, yes, Cardano, yes,
Speaker 1: x l M yes, Ripple, they were all pre mind
Speaker 1: Ripple x RP was a hundred percent. So a hundred
Speaker 1: percent of the Ripple was created by the team that
Speaker 1: invented it and used to make themselves filthy, filthy rich.
Speaker 1: And so that's one of the big differences that you
Speaker 1: have to understand now when it comes to these regulations.
Speaker 1: Like I said, uh f t X kind of sat
Speaker 1: in this kind of they think it's a gray area.
Speaker 1: I don't think it's a gray area. There's this gray area.
Speaker 1: The SEC is like, well, it's a it's a Bahamas corporation. Well,
Speaker 1: they were founded in the US. They transferred to the
Speaker 1: Bahamas their U. S citizens, and they built U. S
Speaker 1: citizens out of money. It's never really stopped the US
Speaker 1: from reaching their long arm of the law and regulated anyway.
Speaker 1: So maybe there's a little bit of a gray area.
Speaker 1: But I think because we're talking about tens of billions
Speaker 1: of dollars that have been lost, we're talking about millions
Speaker 1: of Americans that have lost some of them lost everything.
Speaker 1: It's really bringing this conversation of regulations to the forefront
Speaker 1: the SEC Security Exchange Commission. So there's two regulatory bodies
Speaker 1: really that kind of fall into this. There's the SEC
Speaker 1: Securities Exchange Commission, which is supposed to regulate securities as
Speaker 1: in their name, securities exchange, so the exchanging of securities,
Speaker 1: issuing and exchanging of securities. And then there's the CFTC,
Speaker 1: which is the commodities futures all right, So some of
Speaker 1: these assets kind of fall between here. So Bitcoin has
Speaker 1: been the only digital asset out of the twenty thousand
Speaker 1: or so cryptocurrencies, it's been the only one that has
Speaker 1: been declared a commodity. And that's because, as I said,
Speaker 1: there was no sensual issuer, no one making decisions on
Speaker 1: the network, et cetera, all right, But all the other
Speaker 1: ones it hasn't been clear. Now I believe that that
Speaker 1: it's allowed them to operate that in this gray area.
Speaker 1: That's allowed um, these problems like FTX to get bigger, bigger, bigger.
Speaker 1: But now it's in the forefront, uh, and people are
Speaker 1: going to demand action. The SEC looks horrible in this situation.
Speaker 1: Their only role, the whole point of the organization, why
Speaker 1: they're there, is to protect consumers from exactly this in
Speaker 1: my opinion, they should probably just disband. Look, I am
Speaker 1: not here. I'm not here. I just want to make
Speaker 1: it very clear. I am not pro regulation. As a
Speaker 1: matter of fact, I think we should be able to
Speaker 1: do whatever we want with our money. If I want
Speaker 1: to go gamble in Vegas, or I want to spend
Speaker 1: it all on lottery tickets where I want to buy
Speaker 1: crypto tokens, that's up to me. It's my money and
Speaker 1: I should be able to do that. I don't. I
Speaker 1: don't believe I need the nanny state of the government
Speaker 1: to protect me. I think I should be smart enough
Speaker 1: to make my own decisions. But that's what I think.
Speaker 1: The reality is we do have a regulatory body called
Speaker 1: the SEC, and the reality is they are there and
Speaker 1: their role is supposed to protect us. They've done an
Speaker 1: absolutely horrible job and they're disgraced, and Gary Gains ahead
Speaker 1: of the SEC, should probably step down and apologize. Um. Nevertheless,
Speaker 1: I think that with this egg on their face, so
Speaker 1: to speak, they're going to be forced to up their game.
Speaker 1: They're gonna be forced to stand up. We have lawmakers
Speaker 1: Elizabeth Warren, you know, parading around um you know, uh,
Speaker 1: the Capital saying we need to enforce this. We need
Speaker 1: to you know, step this up. And so I believe
Speaker 1: they're going to have to. So what does that mean, Well,
Speaker 1: like I said, they've been very clear, the SEC has
Speaker 1: been very clear that bitcoin is a commodity. But what
Speaker 1: about the other twenty thousand and so we want to
Speaker 1: take a look at that, and um, when it comes
Speaker 1: to that, when it comes to the securities, can't could ripple?
Speaker 1: Could xr P become a security? Could ethereum become a security? Now,
Speaker 1: we don't know, and it's not for me to decide,
Speaker 1: it's for it's for the SEC to decide. However, Uh,
Speaker 1: I'm gonna tell you that there is a there's something
Speaker 1: called how we test, not how he test? Has four
Speaker 1: basic questions. Um, it gets a little more complex. There's
Speaker 1: like thirty eight points underneath them, but but for the
Speaker 1: for the most part, there's four. And the Supreme Court
Speaker 1: established this four criteria to determine whether an investment contrast
Speaker 1: contract exists. An investment contract is one an investment of money,
Speaker 1: so you've put money in, two into a common enterprise,
Speaker 1: three with the expectation of profit, and four to be
Speaker 1: derived from the efforts of others. So there's four all right. Now,
Speaker 1: if you want to ask about Ethereum or Cardano or
Speaker 1: x RP or any of these other ones, those are
Speaker 1: the four questions. At the Supreme Court, UH defined that
Speaker 1: the SEC would consider these things. Now, there is a
Speaker 1: lawsuit that's been going on for a long time between
Speaker 1: the SEC and Ripple x RP, and so we'll see
Speaker 1: how that shakes out. Now that's going to be UH
Speaker 1: probably going to be used as precedents for pretty much
Speaker 1: the rest of the entire cryptocurrency space, although we've had
Speaker 1: just another one come out recently for this Library token
Speaker 1: Um and the SEC clips said it is a security.
Speaker 1: They tried to fight it, and the SEC said, no,
Speaker 1: it is clearly a security. And I think that sets precedents.
Speaker 1: The way the way the law works is that when
Speaker 1: a court rules on something, that sets this precedence. And
Speaker 1: so that kind of says And actually Library came out
Speaker 1: after the ruling and said, hey, look, this sets a
Speaker 1: very dangerous precedence for the rest of the industry. And
Speaker 1: I think it does. Now the x RP, the Ripple
Speaker 1: x RP is also going to be an even bigger present,
Speaker 1: and I believe that is supposed to come out maybe
Speaker 1: Q one of next year, so within the next you know,
Speaker 1: six months or less, we should know where the sec
Speaker 1: sits on that. But just ask yourself an investment of money,
Speaker 1: So when people buy cryptocurrencies, are they doing it? Are
Speaker 1: they investing their money into it? Do they buy that
Speaker 1: expecting it to go up in value? And of course
Speaker 1: the answer is yes. Pretty much every token is bought
Speaker 1: because people think they can sell it for more later.
Speaker 1: And then number two would be in a common enterprise.
Speaker 1: So we could take Ethereum for example. Um there's Vitalic
Speaker 1: Butterin and the Ethereum Foundation which are steering the direction
Speaker 1: of Ethereum. As a matter of fact, they've changed the
Speaker 1: entire consensus mechanism just recently. They changed the monetary issuance
Speaker 1: a couple of times in the last couple years. So
Speaker 1: there's a group of people that are steering us. It's
Speaker 1: a common enterprise. Three, like I said, with an expectation
Speaker 1: of profits. So first, as an investment of money, yes,
Speaker 1: they money in three with an expectation of profit. I
Speaker 1: believe if you pulled a hundred or a thousand cryptocurrency investors,
Speaker 1: I mean we even used the word investor, they bought
Speaker 1: it because there was an expectation of profit. They thought
Speaker 1: it would be worth more later and then four to
Speaker 1: be derived from the efforts of others. And so, like
Speaker 1: I said, in the group of Ethereum, they have the foundation,
Speaker 1: they have the steering committee. They literally just changed the
Speaker 1: entire consensus mechanisms. So the efforts of others. I think
Speaker 1: it's pretty clear now. Um. I think what people don't
Speaker 1: understand is what happens if they cracked down on these regulations.
Speaker 1: And that's what I want to talk about next. I
Speaker 1: put out a big put out a Twitter post, and
Speaker 1: they had a lot of miscommunication. I want to clarify
Speaker 1: that if you're just tuning in, you're listening to the
Speaker 1: markma Show, we're talking about how the entire cryptocurrency space
Speaker 1: is about to change. Don't go away, be right back,
Speaker 1: all right, welcome back. If you're just tune in, you
Speaker 1: are listening to the Mark Moss Show, and we are
Speaker 1: talking about um cryptocurrency space blowing up, and how I've
Speaker 1: of the regulations are going to come in and change everything,
Speaker 1: and I think a lot of people haven't really thought
Speaker 1: this through. So I put out a Twitter post um
Speaker 1: and I said that if regularly. I think, I believe
Speaker 1: regulations are going to come in and I believe it
Speaker 1: will change the entire trajectory of the of the cryptocurrency space.
Speaker 1: I said that, I think we might have seen the
Speaker 1: last cryptocurrency bull right now. It's very clear to say
Speaker 1: crypto not bitcoin, all right, So there's a big distinction.
Speaker 1: We already talked about that. If you've missed that part,
Speaker 1: go back and listen to the podcast where I kind
Speaker 1: of broke that down a little bit. Or um. I've
Speaker 1: made some very long form videos with a lot of
Speaker 1: details on my YouTube channel. You can go search Mark
Speaker 1: Moss on YouTube and find those as well. But like
Speaker 1: I said, so many people lost so much money with
Speaker 1: the ft X. Uh, there they have. Now you know
Speaker 1: these meetings on Capitol Hill and regulations are coming. The
Speaker 1: SEC failed to do its only job, which is protect people,
Speaker 1: and they are gonna have to step this up. But
Speaker 1: what does it mean? Well, like I said, bitcoin has
Speaker 1: already been deemed a commodity, but everything else is at
Speaker 1: risk here. And so when I said, uh, if, if
Speaker 1: and I believe they will crack down with regulations, then
Speaker 1: I think we've seen the last crypto bull run. And
Speaker 1: when I said the last crypto bull run, what I
Speaker 1: mean is where the entire cryptocurrency market cap just goes
Speaker 1: to the moon like it did in like it did
Speaker 1: one again. I think that's over. I think where you
Speaker 1: can just kind of close your eyes and just buy
Speaker 1: any board ape or you know, JPEG or defy contract
Speaker 1: or whatever and just make a bunch of money, I
Speaker 1: think that's over. Now. Does that mean that there won't
Speaker 1: ever be another one that will go up in value? No,
Speaker 1: it certainly doesn't. And a lot of people really pushed back.
Speaker 1: It was actually I think I had like six comments
Speaker 1: on this Twitter post, which, by the way, if you're
Speaker 1: not following me on Twitter, check it out. It's just
Speaker 1: the number one at the number one, just at one
Speaker 1: Mark moss Um. But anyway, a lot of people are like, oh,
Speaker 1: you don't understand, Mark, you don't know what you're talking about. Um,
Speaker 1: if the SEC cracks down, it will just go off shore. Okay, Yeah,
Speaker 1: they said, you don't understand Mark, the SEC can't stop innovation. Yeah, okay.
Speaker 1: I agree with both of those statements. So it's not
Speaker 1: that I don't understand. I think you don't understand that
Speaker 1: those people don't understand and so what happens is, uh,
Speaker 1: if the SEC cracks down, Yes it will push some offshore,
Speaker 1: and yes, m and yes we'll still have innovation. But
Speaker 1: what will change is that these cryptocurrency companies. A lot
Speaker 1: of people say, well, they'll just pay the fine and
Speaker 1: just move on. It's not that easy because if they
Speaker 1: want to comply with security laws, yes they'll have to
Speaker 1: pay a big fine for sure, but too then they're
Speaker 1: going to have to file as security you have to
Speaker 1: file s ones. They're going to have to UM, They're
Speaker 1: gonna have to disclose everything. So like in Ethereum's case,
Speaker 1: for example, they're going to have to disclose who the
Speaker 1: founders are, how many tokens they have, They're going to
Speaker 1: have to disclose, who the insiders are, who the management
Speaker 1: team is, what what the pre mind was, who kept
Speaker 1: the tokens. They're gonna have to disclose, UM, what related
Speaker 1: parties there are. What's the relationship between Metalic Buterin and
Speaker 1: Joseph Luban, What about the Ethereum foundation, Um, you know,
Speaker 1: what insider trading or insider selling happened. What other controls
Speaker 1: and interests they may have between the companies, what risks
Speaker 1: may be there the lost to disclose all of that,
Speaker 1: and I don't think they're gonna want to. I don't
Speaker 1: think any or I don't want to say any I
Speaker 1: don't think most of these cryptocurrency projects who want to
Speaker 1: disclose that the whole point is that they did the
Speaker 1: i c OH, the initial coin offering, the outcoin offering
Speaker 1: because they didn't want to do all that. So it's
Speaker 1: not just as easy as they'll just pay the fine
Speaker 1: and they'll just move on. No no, no, no, they'll
Speaker 1: be forced to comply. It could take years and millions
Speaker 1: of dollars to do it. But ultimately, I don't think
Speaker 1: they're going to want to disclosed that information. And even
Speaker 1: if they did, they disclosed all that information and they
Speaker 1: were legally able to get away with what they're doing, um,
Speaker 1: and they disclosed all that, then I think everybody would
Speaker 1: look at that and go, We'll wait a minute. Basically,
Speaker 1: what I've just bought as a software company or a
Speaker 1: payment company, or a supply chain company, or a video
Speaker 1: game company, and why am I buying this video game
Speaker 1: company or software company over this video game or software
Speaker 1: payment company. So it's going to change the game. Now,
Speaker 1: Does that mean it goes away. No, it doesn't mean
Speaker 1: it goes away. Does it mean something goes off shore? Sure,
Speaker 1: But you also have to understand how the industry worked.
Speaker 1: And I've talked about this before. I read I read
Speaker 1: actually directly from Sam Bankman Freed's interview that he gave
Speaker 1: an about May of this year with Matt Levine believe
Speaker 1: it was on Bloomberg, and he basically explained that you
Speaker 1: create this protocol, he calls it a ball box. You
Speaker 1: create this just generic box, and you say that it's
Speaker 1: going to change the world, and you create this token,
Speaker 1: and then you trade the token to create this this value,
Speaker 1: and everybody wants it because you've made it look like
Speaker 1: there's like it's valuable. But what really plays into that
Speaker 1: game is venture capitalist. And this is a key piece
Speaker 1: here that most people just don't understand. Maybe they just
Speaker 1: don't understand how the system works. And so venture capital
Speaker 1: is we're an investor invest into a new venture, typically
Speaker 1: like an early round, like an angel investor. And so
Speaker 1: imagine like Uber in Silicon Valley a decade ago or whatever, right,
Speaker 1: and so hey, do you want to invest into my startup? Okay,
Speaker 1: what's it gonna do? What's going to change the world
Speaker 1: in this way. And here's how much money I'm trying
Speaker 1: to raise. And the way venture capitalist work is they
Speaker 1: typically start of a fund of venture capital fund and
Speaker 1: a bunch of people who put money into this fund,
Speaker 1: and this fund might go invest in to say fifteen
Speaker 1: different projects, and that fund locks up that money typically
Speaker 1: seven to ten years. And the reason why is it
Speaker 1: takes seven to ten years for these companies to get
Speaker 1: big enough to be worth anything. And these venture capitalists
Speaker 1: know that the majority of them are probably never going
Speaker 1: to be worth anything, but some of them will hit really,
Speaker 1: really big, and those investors that put that money into
Speaker 1: that fund have that money locked up. The only way
Speaker 1: they get that money back is some sort of a
Speaker 1: liquidity event. So one one of those companies would go public,
Speaker 1: go through the I p O process and go public,
Speaker 1: and then those those early investors could eventually sell their
Speaker 1: stock publicly or too maybe one of those companies gets
Speaker 1: bought out and that creates a liquidity event. Otherwise that
Speaker 1: money is locked up. But venture capitalists love these crypto
Speaker 1: this crypto space because there's instant liquidity. So they're pumping
Speaker 1: money in and they get tokens in return, and they
Speaker 1: can go and dump these tokens some some of them
Speaker 1: almost immediately, and they might make two x, a five x,
Speaker 1: a ten x, a fifty x on their investments immediately
Speaker 1: and still have more upside with the tokens they have
Speaker 1: left over. So the venture capitalists love this, which is
Speaker 1: why it's brought in hundreds of millions dollars of venture capital.
Speaker 1: So they can make their two x by dumping on
Speaker 1: your head on retail, and so then they spend a
Speaker 1: lot of money in marketing, slick marketing and media put
Speaker 1: all over the place. You see all this news about
Speaker 1: all these tokens going higher, higher, higher, higher, highering value,
Speaker 1: so they can get you to buy them so they
Speaker 1: can dump them on you and then they all become worthless.
Speaker 1: So if you understand, that's how it works, which again
Speaker 1: is how it works. I got the receipts if you
Speaker 1: want to check out my YouTube videos, UM and the
Speaker 1: SEC cracks down. Could they go off shore? Yes, and
Speaker 1: they probably will, but most countries also have some sort
Speaker 1: of regulations as well, so they're gonna have to navigate that.
Speaker 1: But more importantly, why I think we may not have
Speaker 1: another Bowl run is because of the venture capitalists their
Speaker 1: US based Now they love this because, like I said,
Speaker 1: they can get instant liquity by dumping on your head.
Speaker 1: But if all this goes off shore, they won't be
Speaker 1: able to go participate because these i c O is
Speaker 1: happening off shore specifically cannot include US investors. So they
Speaker 1: may go off shore to some small little country that
Speaker 1: they can get around these security laws, but the investors
Speaker 1: won't go with them. So does it stop them from
Speaker 1: one off shore? None. Does it stop the innovation, certainly not.
Speaker 1: But what it does stop is hundreds of billions of
Speaker 1: dollars of them of US based venture capital money from
Speaker 1: going in, which then influences the media and the marketing
Speaker 1: and you and allows them to dump on your head.
Speaker 1: And that's why I think if these regulations go through,
Speaker 1: which I think is the most likely case, um, I
Speaker 1: think it ends the crypto bowl run as we know it. Now.
Speaker 1: You may not like that you've been taught and you've
Speaker 1: been told that these are life changing protocols by these
Speaker 1: venture capitalists that have spent a lot of money on this.
Speaker 1: But as someone who studied this for over seven years,
Speaker 1: published over a thousand pages of research, I can tell
Speaker 1: you this is exactly how it works and that's why
Speaker 1: I think it can change. But I could be wrong.
Speaker 1: I'd love to hear from you. Hit me up on
Speaker 1: social media on Twitter, Instagram at one Mark mosson let
Speaker 1: me know what you think. Am I wrong? And if so,
Speaker 1: why don't just tell me I'm wrong. I'd like to
Speaker 1: hear why, um you think that? That's what I think.
Speaker 1: If you're just tuning and you listen to the Mark
Speaker 1: ma Show, if you missed me, check me out on
Speaker 1: the podcast. Just search Mark Mason on your favorite podcast
Speaker 1: player for the recap of this and that's what I got.
Speaker 1: Thanks for listening.