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Speaker 1: Hello, Olins fans. This is a special episode of the

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Speaker 1: podcast that was recorded June AIDHS at the Bloomberg In Conference.

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Speaker 1: Our guest Ben mackenzie. He's a well known actor. You

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Speaker 1: might remember him from the oc and he's the author

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Speaker 1: of a forthcoming book called Easy Money about his journey

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Speaker 1: into the world of cryptocurrency. Hello, and welcome to another

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Speaker 1: episode of the Odd Lots Podcast. I'm Joe Wisenthal and

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Speaker 1: I'm Tracy Alloway. Tracy, you know that intro video they showed,

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Speaker 1: you know, use our line the perfect guest, But this week,

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Speaker 1: of all weeks, we have a really good guest.

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Speaker 2: Yeah, this week it's actually true. We're going to be

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Speaker 2: talking crypto actually with someone who you wouldn't necessarily expect

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Speaker 2: to be the perfect guest to discuss crypto.

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Speaker 3: No, but he is.

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Speaker 1: So obviously this week we're recording it the same week

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Speaker 1: after the SEC filed suits against both coinbase and Binance,

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Speaker 1: So we're going to be speaking with Ben McKenzie, a

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Speaker 1: well known actor and the author of the forthcoming book

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Speaker 1: Easy Money, Cryptocurrency, Casino Capitalism, and the Golden Age of Fraud. Ben,

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Speaker 1: thank you so much for joining us. How did you

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Speaker 1: arrange that sort of like from a pr standpoint, that

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Speaker 1: you got the government to file suits against Coinbase and

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Speaker 1: Finance as a lead up to your book.

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Speaker 3: That's very well done. Yeah yeah, I had nothing to

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Speaker 3: do with it. OK, very grateful.

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Speaker 4: And if they could just hold off on any DOJ

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Speaker 4: pending action and to just wait.

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Speaker 2: Until wonderful, you're going to have to keep rewriting the epilogue.

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Speaker 2: I think, well, why don't I ask the obvious question,

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Speaker 2: which is how does an actor get into the profession

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Speaker 2: or hobby of investigating cryptocurrencies?

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Speaker 3: Sure, there's a longer answer.

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Speaker 4: The shorter answer is a sort of a mid mini

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Speaker 4: midlife crisis, like a just sort of a It was

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Speaker 4: the fall of twenty twenty. It was the height of

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Speaker 4: the pandemic, and I came down with a serious case

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Speaker 4: of fomo.

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Speaker 3: I saw all these knuckleheads getting rich, and I thought, hey,

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Speaker 3: maybe I should, you know, try to try to get

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Speaker 3: rich as well. In a roundabout way. That that led

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Speaker 3: me to crypto.

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Speaker 4: A very good friend of mine who in my twenties

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Speaker 4: encouraged encouraged me to invest in an obscure medical device

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Speaker 4: company that was going to create synthetic blood and it

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Speaker 4: was going to make a ton of money. A random

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Speaker 4: guy at a wedding had assured him so, and so

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Speaker 4: we definitely needed to invest in this. I put money

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Speaker 4: into it and promptly lost almost all of it. Might

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Speaker 4: have been a penny penny stock pumping up. Anyway, that

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Speaker 4: same friend came back to me in twenty twenty one

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Speaker 4: and said, you gotta buy.

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Speaker 3: Bitcoin, and I thought, hmm, I wonder what.

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Speaker 4: Is this cryptocurrency stuff. So I have a degree in

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Speaker 4: economics from the University of Virginia. It's about twenty years old.

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Speaker 4: So I dusted that off and I ended up writing

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Speaker 4: this book. So as to why I'm here, I would

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Speaker 4: say the book is really it's really.

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Speaker 3: About money and lying, right. And I know about.

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Speaker 4: Money because a little bit because I have an econ

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Speaker 4: degree and it made a little bit up two decades

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Speaker 4: of show essence. But I know about lying because I'm

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Speaker 4: an actor and I do it for a living. And

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Speaker 4: so when cryptocurrencies were calling themselves currencies, the first thing

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Speaker 4: I bumped up on was the word. You know, as

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Speaker 4: an actor and a storyteller, where it's are our tools,

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Speaker 4: and they can be used for a variety of purposes.

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Speaker 4: Some of them are honorable and some of them not.

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Speaker 4: And although bitcoin, of course was intended to be a currency,

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Speaker 4: and that was the intention supposedly of Soatoshi Nakamoto, it

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Speaker 4: never really functioned that way, right, and it certainly wasn't

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Speaker 4: functioning that way in twenty twenty, twenty twenty one, at

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Speaker 4: the height of the mania.

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Speaker 3: So that's where I started, like, these are our currencies?

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Speaker 3: So what are that?

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Speaker 1: So the friend came and you already had to be okay,

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Speaker 1: this is the guy who lost you a bunch of money. Yeah,

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Speaker 1: so rather than because you said you in fomo, so

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Speaker 1: a lot of people like they just went out and

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Speaker 1: bought when your first instinct was like a brush.

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Speaker 3: Off the old economics books.

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Speaker 1: Yeah, but what where where did you see? Okay, so

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Speaker 1: you like plow your money into crypto at the top. No,

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Speaker 1: but that's still like like, how did you sort of

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Speaker 1: begin your exploration of this industry?

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Speaker 3: Short?

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Speaker 4: Well, I read a lot of so first I needed

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Speaker 4: to understand, like, okay, where were we in in twenty

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Speaker 4: twenty one? I very quickly came to the conclusion we

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Speaker 4: were in a bubble, you know, a fairly obvious bubble

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Speaker 4: perhaps retrospect, But the book is called easy money, not

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Speaker 4: just because of this fake money called cryptocurrency, but also

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Speaker 4: because of the easy money policies that have been around

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Speaker 4: since the GFC, and that went nuts, you know, during

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Speaker 4: the response to the pandemic, trillions of dollars jumped into

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Speaker 4: the economy, and by the time I was thinking about

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Speaker 4: entering the market, everything had gone crazy. So I took

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Speaker 4: Gary Gensler, the head of the set, taught this course

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Speaker 4: in MIT on blockchain and crypto, and it was available

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Speaker 4: for free online. And again I had a lot of

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Speaker 4: time on my hands, so I took that.

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Speaker 3: I read a.

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Speaker 4: Bunch, and I just I was stuck with the feeling

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Speaker 4: that so fraud, historically speaking, runs rampant during easy money times,

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Speaker 4: during bubble times for fairly obvious reasons. Right when there's

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Speaker 4: access easy access to money and credit, people speculate wildly

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Speaker 4: in term in search of high returns. Some of those,

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Speaker 4: you know, innovative technologies are truly innovative, and people make

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Speaker 4: a ton of money, but some of them are fraud.

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Speaker 4: Charles Kendelberger's studied this, you know, extensively, and so I

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Speaker 4: felt like there probably was a lot of fraud, and

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Speaker 4: that became kind of a pandemic hobby of mine, you know,

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Speaker 4: betting against fraudulent companies and stuff like that. And around

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Speaker 4: that same time, my friend Dave came to me and said,

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Speaker 4: bitcoin is is the Bee's knees. And I was troubled

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Speaker 4: by by bitcoin and crypto because it was everywhere and

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Speaker 4: the celebrities were selling it, and it was you know,

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Speaker 4: this super Bowl was going to feature it heavily. And

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Speaker 4: I thought, look, if I'm right, and maybe I wasn't.

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Speaker 4: If I'm right, this is something like the biggest Ponzi

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Speaker 4: scheme in history. That troubled me. So I was actually

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Speaker 4: reading my daughter the Emperor's New Clothes. My daughter is, yeah,

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Speaker 4: it sounds made up, and I probably subconscious I was

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Speaker 4: probably intending like I was, like, you know, but I

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Speaker 4: did see it on this shelf and it did happen organically.

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Speaker 3: She was six at the time.

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Speaker 4: And I remember the gist of the story, but I

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Speaker 4: had forgotten a couple of points. The first, the tailor's

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Speaker 4: trick everyone basically an appeal to ego and statush worship. Right,

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Speaker 4: only the smartest people can see this, only the people

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Speaker 4: of highest station. And the second thing, the thing that

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Speaker 4: really stuck with me, was as the at the end

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Speaker 4: of the story is the Emperor's gallivanting through town naked,

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Speaker 4: and the adults are pretending not to notice. It's a

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Speaker 4: child who calls out scam. It's the only person brave

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Speaker 4: enough to call truth is he doesn't know he's being brave,

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Speaker 4: He's simply speaking the truth. Well, it was hard not

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Speaker 4: to see myself as the child in that metaphor, right, Like,

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Speaker 4: what the heck do I know? I'm just an actor.

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Speaker 4: I have an undergraduate degree in economics twenty years old.

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Speaker 3: But I don't know.

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Speaker 4: Maybe I'm right right, like like, and how often in

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Speaker 4: life do you get a chance to have an adventure?

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Speaker 4: So I got high. I got my medical marijuana card

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Speaker 4: over the pandemic because you know, I like alcohol, but

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Speaker 4: like there's a limit, you know what I mean? And right,

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Speaker 4: and I was definitely over it. And so I got high,

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Speaker 4: and I was like, well, I should.

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Speaker 1: Write a book about it's really retro that anyone would

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Speaker 1: like go to the now that they literally on the street,

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Speaker 1: that someone would go to the effort of like getting.

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Speaker 4: A g No, I'm such a like goodie two shoes, right,

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Speaker 4: I have my card and I like overpay for my marijuana, like,

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Speaker 4: but yeah, I got high, and I was I should

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Speaker 4: write a book about about crypto, and which sounded like

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Speaker 4: it sounds like a really good idea when you're high.

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Speaker 4: The next morning, sober, I realized I didn't know how

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Speaker 4: to write a book. So I got high again, and

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Speaker 4: I realized this journalist Jacob Silverman had written an article

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Speaker 4: that that I really found quite funny. It was called

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Speaker 4: even Donald Trump knows Bitcoin as a scam, which was

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Speaker 4: basically Trump didn't really criticize crypto until he left office,

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Speaker 4: and then he was like a scam. It brought together

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Speaker 4: a couple things I've been thinking about, Golden Ajor fraud

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Speaker 4: and all that. So I summoned the courage to DM

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Speaker 4: him on Twitter as you do. I realized he lived

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Speaker 4: in Brooklyn and took him to drinks and said, hey,

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Speaker 4: what if we write a book that I don't know

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Speaker 4: how to write about events that haven't happened yet, And

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Speaker 4: he was going on parental leave, and he foolishly agreed.

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Speaker 3: So I love that.

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Speaker 2: During the debts of the pandemic, while other people were

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Speaker 2: getting high and baking soury dough bread or watching Tiger King,

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Speaker 2: you were like, I'm going to launch an all out

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Speaker 2: investigation into the cryptocurrency market.

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Speaker 3: Well, I'm a weird guy.

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Speaker 2: You touched on the easy money aspect of it and

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Speaker 2: also the fomo, but can you talk a little bit

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Speaker 2: more about, like what is it that makes cryptocurrency so

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Speaker 2: attractive to so many people, and particularly one segment of

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Speaker 2: the population, it seems, which would be young men. Like,

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Speaker 2: what is the you know, the attraction there?

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Speaker 4: Well, that's a great that's a great question. So I

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Speaker 4: kind of look at as a storyteller. I became fascinated

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Speaker 4: by Robert Schiller's work, the Nobel Prizeman Economists, who's talked

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Speaker 4: about how economic narratives form and their response to real events. Right,

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Speaker 4: and so the Bitcoin white paper's release in October of

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Speaker 4: two thousand and eight was at the height of the

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Speaker 4: sun Prime crisis, and there was an understandable mistrust of

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Speaker 4: legacy financial institutions banks all that banks were even more

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Speaker 4: unpopular than they often are, and so the timing was

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Speaker 4: perfect to set in motion the notion of a theoretically

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Speaker 4: peer to pure currency. It didn't really work, It never

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Speaker 4: didn't take off for a while. I think it's just

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Speaker 4: sort of I guess to back up the reason that

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Speaker 4: I think crypto appealed to so many people in so

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Speaker 4: many different ways and so many different types of people

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Speaker 4: forty million Americans about crypto is that they could kind

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Speaker 4: of see anything in it that they wanted to right.

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Speaker 4: I mean, on one level, it's very simple, it's a

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Speaker 4: get rich quick scheme. But on another the technology people

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Speaker 4: that were interested in sort of like libertarian politics could

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Speaker 4: do that. The people that wanted to build It was

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Speaker 4: marketed as generational wealth builder, was marketed as a way

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Speaker 4: to unbank the bank bank the unbanked, so.

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Speaker 2: Also the next big thing on Wall Street at the

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Speaker 2: same time.

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Speaker 4: Exactly what it was marketed is the future of money,

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Speaker 4: and all you needed to invest in the future of

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Speaker 4: money was the willingness to part with the current version

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Speaker 4: of it. Yeah, so it had a very broad which

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Speaker 4: was also one of the reasons why was so skeptical

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Speaker 4: of its authenticity was that how can it be all

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Speaker 4: of these different things at the same time, and yet

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Speaker 4: of course it wasn't the currency, so then what the

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Speaker 4: hell was it? Well, it seemed like an investment, right,

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Speaker 4: I mean, people are putting real money into it, hoping

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Speaker 4: to make real money off of it. That sounds like

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Speaker 4: an investment contract to me. So I had to figure out,

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Speaker 4: you know, how did biitclin come to be classified as

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Speaker 4: a commodity, which is sort of an interesting, sort of

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Speaker 4: dorky story. But and then what the heck were these

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Speaker 4: twenty thousand other things?

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Speaker 3: You know.

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Speaker 1: One of the things that's a little bit surprising or

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Speaker 1: sort of interesting is that for as much talk about

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Speaker 1: crypto that exists, like, it's not that big, Like the

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Speaker 1: total value of all the coins I think is the

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Speaker 1: total value of all the coins I think is like

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Speaker 1: around a trillion dollars supposedly, supposedly, and then like you know,

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Speaker 1: we discover you know, and you've you've reported this out

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Speaker 1: like it's it's small. There are a lot of people

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Speaker 1: who are just like on a group chat together and

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Speaker 1: they're all important industry. Can you talk about like how

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Speaker 1: big is this industry? How real is this industry?

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Speaker 4: In your it's it's much much much smaller than then

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Speaker 4: you know that one trillion dollar number for that market cap.

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Speaker 3: Number, so and you don't have to take my word

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Speaker 3: for it. In March of twenty twenty two, I was

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Speaker 3: at south By Southwest.

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Speaker 4: It was my first venture into the real world Jacob

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Speaker 4: and I had done everything virtually up to that point.

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Speaker 4: I ran into a guy named Alex Mashensky. Alex Mashchenski

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Speaker 4: was the CEO of a crypto lending firm called Celsius.

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Speaker 4: It's now bankrupt. I he agreed to be interviewed. I

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Speaker 4: asked him how much real money is in crypto. He

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Speaker 4: didn't ask me what real money was. He said ten

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Speaker 4: to fifteen percent, said the rest of speculation. Now, in

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Speaker 4: March of twenty twenty two, the crypto market cap was

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Speaker 4: one point eight trillion dollars, So you know, give or

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Speaker 4: take one point five trillion of that.

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Speaker 3: Isn't there.

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Speaker 4: It's it's speculations, leverage, it's all these other things. At

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Speaker 4: Chill ran through my I mean he said, it's sort

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Speaker 4: of nonchalantly, but at chill ran through my spine because

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Speaker 4: regular people don't understand that. I mean, they think when

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Speaker 4: they buy a bitcoin, they had, you know, bitcoins whatever.

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Speaker 3: It is twenty six, twenty seven. I had no idea.

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Speaker 4: They think they have twenty seven thousand dollars, but in

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Speaker 4: a way they actually only have maybe ten or fifteen

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Speaker 4: percent of that.

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Speaker 3: Maybe if they can get it out, it's not.

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Speaker 1: A sorry, sure, explain that if if someone has a

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Speaker 1: bitcoin on coinbase or whatever, yeah, what's the twenty eight

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Speaker 1: twenty six thousand? True, they could sell that and get

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Speaker 1: twenty six thousands. So what do you mean when you

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Speaker 1: say there's untill fifteen or twenty.

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Speaker 3: Sure.

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Speaker 4: Yeah, And that's a very good point, and I do

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Speaker 4: want to covey on it. If you're going through a

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Speaker 4: licensed exchange, well perhaps not a license exchange, but one

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Speaker 4: that's operating as an exchange, and yeah, you're you're, you're,

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Speaker 4: You're probably good. And if you're not trying to move

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Speaker 4: a lot of money, you're probably good. But the liquidity

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Speaker 4: in crypto is very, very low. And Brian Brooks.

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Speaker 3: Who was the chief legal officer.

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Speaker 4: Of Coinbase and then he was the acting control of

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Speaker 4: the currency and then he went to binance US for

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Speaker 4: like three months, he testified under oat to Congress about this,

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Speaker 4: So you know, you don't have take my word for it.

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Speaker 3: Again, like, the liquidity is very little, So how does

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Speaker 3: it work?

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Speaker 4: Well, most of the volume and crypto runs through the

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Speaker 4: overseas exchanges, right, it ran through FTX before it was

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Speaker 4: shut down. It's now running through finance or you know,

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Speaker 4: finance is the biggest crypto exchange by a country model.

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Speaker 4: It's huge, But the question is how much of that

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Speaker 4: volume is real. Wash trading is an enormous part of cryptocurrency.

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Speaker 4: I mean, you've seen it in the SEC charges against Finance.

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Speaker 4: I believe the allegation of their first or second day

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Speaker 4: they were set up was that ninety nine percent of

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Speaker 4: the volume in the first hours wash trading, seventy percent

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Speaker 4: on the first day.

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Speaker 3: I've read papers, academic.

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Speaker 4: Papers that have surveyed I think they surveyed twenty nine

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Speaker 4: different exchanges.

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Speaker 3: They found seventy percent wash trading on the unregulated exchanges.

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Speaker 3: So it's just not there.

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Speaker 4: People are able to create I'm leaving Bitcoin aside for

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Speaker 4: the moment. Talking to the other cryptos. People are able

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Speaker 4: to create as much crypto as they want. That allows you,

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Speaker 4: if you can borrow against it, to create as much

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Speaker 4: leverage as you want. When I testified against testified to

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Speaker 4: Congress in December, Professor Hillary Allen, professor of American University,

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Speaker 4: was on the other side with me.

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Speaker 3: Testifying alongside me.

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Speaker 4: She wrote a paper in February of twenty twenty two,

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Speaker 4: so just a few months before crypto kind of fell

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Speaker 4: apart and She compared the dynamics of crypto to the

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Speaker 4: subprime crisis, and they're very similar in many ways. Leverage, complexity,

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Speaker 4: rigidity plus a bank run.

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Speaker 3: Equals a crash.

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Speaker 4: The difference is in crypto, the leverage is unlimited because

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Speaker 4: you can print as much crypto as you want.

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Speaker 3: The complexity is similar.

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Speaker 4: You know, these all of these things are so complicated,

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Speaker 4: at least theoretically, right, staking pools and protocols and smart

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Speaker 4: contracts and blah blah blah blah.

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Speaker 3: The rigidity is even worse.

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Speaker 4: Because of the things like the smart contracts, and even

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Speaker 4: you know, the code itself, it's irreversible. It only moves

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Speaker 4: in one direction. So it's a blockchain that can be

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Speaker 4: added to but never subtracted from. So when fit hits

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Speaker 4: the shan, there's nothing you can do.

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Speaker 3: It just blows up.

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Speaker 4: And if you combine that criminal activity, you know.

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Speaker 3: A lot of people lose a lot of money, but

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Speaker 3: not as much money as as clan.

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Speaker 2: Can you talk a little bit more about the leverage

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Speaker 2: example in the context of specifically I'm thinking about fts, yes, right,

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Speaker 2: because they were sort of the trifecta of creating new

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Speaker 2: tokens out of nothing, borrowing against them and then also

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Speaker 2: potentially allegedly using wash trading to push the value of

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Speaker 2: those tokens up so they could get even more credit.

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Speaker 3: Exactly exactly right.

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Speaker 4: So FTX said this token FTT, and I think you should.

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Speaker 4: You know, let's just start with the obvious. You have

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Speaker 4: an exchange that's issuing its own token, right, its own

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Speaker 4: security basically, right, and as Finance has the same Finance

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Speaker 4: has BnB, and.

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Speaker 3: It also has its own stable coin b USD. So

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Speaker 3: already you've got you know.

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Speaker 4: Potential massive conflicts of interest, right. Imagine if the Nasdaq

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Speaker 4: like issued its own you know, I mean, we're going

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Speaker 4: to trade the stock, We're going to issue the stock.

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Speaker 3: We're gonna.

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Speaker 4: And another thing that I think was sort of the

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Speaker 4: poker chips and the crypto casinos are tethers. Tether is

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Speaker 4: the biggest stable coin in crypto by an enormous amount.

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Speaker 4: There's supposedly eighty plus billion tethers out there. The biggest

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Speaker 4: client of tether, according to protos is Crypto publication, was

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Speaker 4: Alometer Research. Alometer Research supposedly bought I think it's thirty

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Speaker 4: six point eight.

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Speaker 3: Billion dollars worth of tether. How how did that work?

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Speaker 4: How Alameda gave thirty six point eight billion real US

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Speaker 4: dollars to Tether. That seems unlikely to be true, given

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Speaker 4: that that Alameda had raised a few billion from vcs

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Speaker 4: and allegedly perhaps had stolen some money from their clients.

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Speaker 4: But how did you get to thirty six point eight

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Speaker 4: So how did it work?

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Speaker 3: I don't know.

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Speaker 1: So there's been a lot of skepticism about the existence

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Speaker 1: and the persistent existence of Tether over the years, and

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Speaker 1: I think both of us have joked that, like, you know,

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Speaker 1: in the year twenty two one hundred, whether there's still

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Speaker 1: gonna it's like the cock croach surviving the new their winner.

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Speaker 1: It's like somehow Tether's gonna be there holding the peg.

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Speaker 1: But it is kind of weird because it's like, you know,

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Speaker 1: it has not blown up, right, and many other things

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Speaker 1: that people thought were professionally run, I would say FTX

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Speaker 1: and the associated entities have blown up. What did you

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Speaker 1: learn about Tether and what's interesting about it?

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Speaker 3: In the course of writing this book, t Other's a

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Speaker 3: fascinating company.

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Speaker 4: The c fo is paid a sixty five thousand dollars

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Speaker 4: settlement to Microsoft for software piracy. The CEO hasn't been

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Speaker 4: seen in public in many years. That public face of

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00:19:22,760 --> 00:19:27,040
Speaker 4: the company is their CTO. The Wall Street Journal reported

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Speaker 4: that as recently as twenty nineteen, four individuals controlled eighty six.

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Speaker 3: Percent of Tether.

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Speaker 4: So it's this very very small company supposedly dealing in

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Speaker 4: you know, up to eighty billion dollars.

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Speaker 3: Yeah.

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Speaker 4: I don't know how much more I should say except

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Speaker 4: that that's very suspicious and it is incredible that they've survived.

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Speaker 4: But they have deep ties to to SAM and FTX

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Speaker 4: and Alameda, and you know, I guess we'll see what happens.

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Speaker 2: Let me ask that question in a slightly different way,

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Speaker 2: which is because I think one of the frustration for

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Speaker 2: a lot of journalists is, you know, cryptocurrencies have been

390
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Speaker 2: around for a long time at this point, and I've

391
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Speaker 2: certainly written my share of eulogies for things like that coin.

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Speaker 2: I think the first one I wrote was in twenty eleven,

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Speaker 2: if you can imagine, Yeah, and then I did it

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Speaker 2: again in twenty seventeen, and each time it comes back.

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Speaker 2: So what would it take What would be the catalyst

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Speaker 2: for something like Tether to finally and definitively, you know,

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Speaker 2: break the peg and be put to bed.

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Speaker 3: These are not honest markets. I don't know how.

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Speaker 4: Else to to say it, given the amount of wash

400
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Speaker 4: trading and god knows what else what other shenanigans, you know,

401
00:20:46,520 --> 00:20:50,160
Speaker 4: Sam into Twitter spaces. Somebody asked him, did you even

402
00:20:50,200 --> 00:20:53,000
Speaker 4: make these trades? Like this even exists? And he said

403
00:20:53,359 --> 00:20:56,320
Speaker 4: some of it no. So that's a bucket shop, right,

404
00:20:56,359 --> 00:20:59,760
Speaker 4: I mean, that's that's what that is. Bucket shops or

405
00:20:59,800 --> 00:21:03,320
Speaker 4: maybe I llegal in the twenties, So in some senses

406
00:21:03,320 --> 00:21:05,760
Speaker 4: we are revisiting, you know, a century ago. So as

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Speaker 4: as to why it hasn't fallen apart.

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Speaker 3: In what it would take, I believe it would take

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Speaker 3: law enforcement action to to to really kind of get

410
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Speaker 3: to the bottom of where the actual real money is.

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Speaker 3: We'll see if that happens.

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Speaker 4: But you're you're getting closer to I mean, the season

413
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Speaker 4: assists that the SEC issued to Finance to freeze their money.

414
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Speaker 4: I think is sort of the next thing to kind

415
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Speaker 4: of watch because they're clearly concerned that that the money

416
00:21:31,600 --> 00:21:33,720
Speaker 4: could be could be moved away and that the customers,

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Speaker 4: US customers can't get the money up.

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Speaker 1: So again we started this conversation by noting the timing

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Speaker 1: this week of the what is Finance where did this?

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Speaker 1: I mean, it's obviously massive, and there's been a lot

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Speaker 1: of reporting on it, but in terms of like how

422
00:21:44,760 --> 00:21:47,399
Speaker 1: you studied the company in your book, like what is

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Speaker 1: it the gay that just like such an extraordinary footprint

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00:21:50,680 --> 00:21:53,159
Speaker 1: in the global market, How did it establish this? And

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Speaker 1: how crucial is it to like all of the you know,

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00:21:56,760 --> 00:21:58,080
Speaker 1: these fake prices, the.

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Speaker 3: Prices that exist on binance. It's absolutely crue finance.

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Speaker 4: I don't know today, but it's I believe actually it's

429
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Speaker 4: still over half of the of the volume in crypto

430
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Speaker 4: is a spot volume trades through finance. I think it's

431
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Speaker 4: been as much as I believe seventy percent, So it's

432
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Speaker 4: just absolutely massive, just dwarfs every other exchange. As to

433
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Speaker 4: how it succeeded, I mean, chanpeng Xiao started early when

434
00:22:20,920 --> 00:22:23,840
Speaker 4: when when crypto is in a much smaller stage. He's

435
00:22:23,920 --> 00:22:28,240
Speaker 4: very aggressive about courting clients, especially big firms, to trade

436
00:22:28,280 --> 00:22:32,320
Speaker 4: on it, and he funded things like FDx. He was

437
00:22:32,320 --> 00:22:35,760
Speaker 4: an initial investor in FTX, and he's been very good

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00:22:35,840 --> 00:22:43,240
Speaker 4: at finance. Global has no headquarters. There is no finance headquarters,

439
00:22:43,640 --> 00:22:47,360
Speaker 4: which is a pretty neat trick because it becomes difficult to.

440
00:22:47,640 --> 00:22:51,760
Speaker 2: Pin you down there is a rumored headquarters, but yeah,

441
00:22:51,880 --> 00:22:52,960
Speaker 2: we won't go into it.

442
00:22:53,200 --> 00:22:55,720
Speaker 3: Yeah, let's not go into that quite unless you want

443
00:22:55,800 --> 00:22:59,960
Speaker 3: to know what there are our local.

444
00:23:00,000 --> 00:23:03,280
Speaker 4: Affiliations, Right, there's a Binance US, there was a Finance Australia.

445
00:23:03,320 --> 00:23:04,200
Speaker 3: I think all these places.

446
00:23:04,560 --> 00:23:10,640
Speaker 4: Well, in the SEC lawsuit they mentioned this tai chi document.

447
00:23:10,960 --> 00:23:14,760
Speaker 4: So the tai chi document is this allegedly a document,

448
00:23:14,800 --> 00:23:16,560
Speaker 4: the internal document from Finance.

449
00:23:16,680 --> 00:23:19,080
Speaker 3: Basically, we're going to practice tai chi.

450
00:23:19,280 --> 00:23:23,880
Speaker 4: We're going to set up locally compliant places like Finance

451
00:23:24,000 --> 00:23:26,040
Speaker 4: US that are going to plain ice with the authorities

452
00:23:26,040 --> 00:23:27,000
Speaker 4: and follow the rules.

453
00:23:27,280 --> 00:23:29,360
Speaker 3: But the volume, we're going to push all the volume.

454
00:23:29,080 --> 00:23:34,200
Speaker 4: Onto the main exchange, so redirect to the regulator's energy

455
00:23:34,400 --> 00:23:38,280
Speaker 4: towards the towards the local shops. If that's true, then

456
00:23:38,560 --> 00:23:44,560
Speaker 4: interesting strategy, heretofore successful. I believe the yen of Champeg

457
00:23:44,640 --> 00:23:48,679
Speaker 4: Jao's tai chi may meet the yang of US law enforcement.

458
00:23:48,760 --> 00:23:50,399
Speaker 3: But I guess we'll see. Well.

459
00:23:50,600 --> 00:23:53,320
Speaker 2: So one thing on that note, I mean, the proximate

460
00:23:53,400 --> 00:23:56,240
Speaker 2: cause of a lot of the recent crypto drama was

461
00:23:56,440 --> 00:24:00,280
Speaker 2: CZ starting to criticize FTX and ft T TOE, in

462
00:24:01,600 --> 00:24:04,520
Speaker 2: which a lot of people I think commented at the

463
00:24:04,560 --> 00:24:06,800
Speaker 2: time was kind of weird. If you think of crypto

464
00:24:06,920 --> 00:24:11,800
Speaker 2: as a sort of house of cards market that involves

465
00:24:11,840 --> 00:24:15,080
Speaker 2: a few big players, it seems like a very dangerous

466
00:24:15,080 --> 00:24:18,840
Speaker 2: strategy to start attacking each other. Do you have any

467
00:24:19,040 --> 00:24:21,680
Speaker 2: idea or like conspiracy theory about what was.

468
00:24:21,640 --> 00:24:22,320
Speaker 3: Going on there?

469
00:24:23,160 --> 00:24:25,480
Speaker 4: Well, I mean I was talking to Sam. I interviewed

470
00:24:25,520 --> 00:24:29,680
Speaker 4: Sam in July last year, and then we continue a

471
00:24:29,760 --> 00:24:34,240
Speaker 4: DM conversation through October. Things were clearly getting pretty bad.

472
00:24:35,240 --> 00:24:39,760
Speaker 3: He talked of a stable coin war with CZ and Binance,

473
00:24:39,800 --> 00:24:44,160
Speaker 3: so there was clearly some animosity there. And then yeah,

474
00:24:44,200 --> 00:24:45,080
Speaker 3: I mean, what I know.

475
00:24:45,080 --> 00:24:49,520
Speaker 4: Publicly, what's been presented publicly is that seat that Sam

476
00:24:49,840 --> 00:24:54,280
Speaker 4: and as cohort Bran Salem started kind of mocking CZ

477
00:24:54,440 --> 00:24:58,160
Speaker 4: on Twitter, saying can CZ even come to this country?

478
00:24:58,240 --> 00:25:01,760
Speaker 4: Things like that because CZ's a Chinese Canadian.

479
00:25:03,200 --> 00:25:04,680
Speaker 3: Pretty bold strategy.

480
00:25:04,920 --> 00:25:09,480
Speaker 4: And then the balance sheet of Alamito leaked I was

481
00:25:09,480 --> 00:25:13,639
Speaker 4: reported by coin desk and it was you know, can

482
00:25:13,680 --> 00:25:15,879
Speaker 4: I say shit show on on the okay? It was

483
00:25:16,040 --> 00:25:20,200
Speaker 4: it was a ship show and and CZ had this chip,

484
00:25:20,280 --> 00:25:22,280
Speaker 4: which is that he owned he had a lot of

485
00:25:22,280 --> 00:25:23,280
Speaker 4: the FTT token.

486
00:25:24,480 --> 00:25:28,199
Speaker 3: Sam had tried to separate himself from CZ. I believe.

487
00:25:28,560 --> 00:25:30,600
Speaker 4: I think they fell out over a Malta as a

488
00:25:30,640 --> 00:25:33,840
Speaker 4: license in Malta. That that's allegedly that Caz he didn't

489
00:25:33,840 --> 00:25:35,120
Speaker 4: want to fill out the paperwork or something.

490
00:25:35,160 --> 00:25:36,480
Speaker 3: It's like, if you don't want to fill out the

491
00:25:36,480 --> 00:25:37,560
Speaker 3: paperwork in Malta.

492
00:25:37,840 --> 00:25:41,200
Speaker 4: Anyway, Uh, then so they couldn't pay him real money,

493
00:25:41,240 --> 00:25:43,200
Speaker 4: so they so they gave him some I think, but

494
00:25:43,200 --> 00:25:45,480
Speaker 4: but he was mainly paid out in FTT, which gave

495
00:25:45,560 --> 00:25:47,800
Speaker 4: him this chip to play right if he has the

496
00:25:47,880 --> 00:25:50,119
Speaker 4: law of the supply. So all of a sudden there

497
00:25:50,119 --> 00:25:55,000
Speaker 4: was a round on FTT. Sam's cohort Caroline Ellison, tried

498
00:25:55,040 --> 00:25:57,840
Speaker 4: to stop the bleeding by saying, you know, by all

499
00:25:58,000 --> 00:26:00,960
Speaker 4: the FTT you wanted this price. Since Ceci said no,

500
00:26:01,440 --> 00:26:06,719
Speaker 4: let the market play out, and it collapsed in spectacular fashion.

501
00:26:06,760 --> 00:26:10,840
Speaker 4: And then there was this brief moment where cz considered

502
00:26:10,920 --> 00:26:14,119
Speaker 4: buying the company and a non binding letter of intent,

503
00:26:14,200 --> 00:26:18,359
Speaker 4: which of course was immediately transformed by certain members of

504
00:26:18,400 --> 00:26:20,439
Speaker 4: the media into he was definitely gonna buy the company,

505
00:26:20,600 --> 00:26:22,320
Speaker 4: but of course it's a non binding letter of intent.

506
00:26:22,520 --> 00:26:25,440
Speaker 3: So twelve hours later he said no, I'm good.

507
00:26:25,800 --> 00:26:29,280
Speaker 1: What was your take What was your takeaway from interviewing

508
00:26:29,320 --> 00:26:33,080
Speaker 1: Sam obviously prior to the events of November, like, well,

509
00:26:33,400 --> 00:26:34,600
Speaker 1: what were your interactions with him?

510
00:26:34,640 --> 00:26:38,000
Speaker 4: Like, well, our interview in person was interesting. It was

511
00:26:38,080 --> 00:26:43,000
Speaker 4: July twentieth, twenty twenty two. Was in a midtown hotel

512
00:26:43,000 --> 00:26:43,840
Speaker 4: in Midtown.

513
00:26:43,560 --> 00:26:44,200
Speaker 3: Right around here.

514
00:26:44,800 --> 00:26:48,320
Speaker 4: At the time, Crypto had done it sort of first crash,

515
00:26:48,440 --> 00:26:49,960
Speaker 4: the May crash of Taro Luna.

516
00:26:51,240 --> 00:26:54,399
Speaker 3: So it was seemingly on life support. But Sam was

517
00:26:54,560 --> 00:26:57,040
Speaker 3: the golden boy, right.

518
00:26:57,160 --> 00:27:01,919
Speaker 4: Sam was, you know, spending a lot of money on

519
00:27:01,920 --> 00:27:04,720
Speaker 4: Capitol Hill. He was trying to get a particular piece

520
00:27:04,720 --> 00:27:09,000
Speaker 4: of legislation through the Ad Committee, the DCPA. He was

521
00:27:09,080 --> 00:27:11,240
Speaker 4: meeting with the CFTC Commissioner. I believe he met with

522
00:27:11,320 --> 00:27:15,080
Speaker 4: him at least ten times. And he was being called

523
00:27:15,480 --> 00:27:19,439
Speaker 4: the JP Morgan of Crypto by none other than Anthony Scaramucci,

524
00:27:19,480 --> 00:27:23,040
Speaker 4: the Booch with whom he had a business relationship anyway.

525
00:27:24,200 --> 00:27:27,520
Speaker 4: So and he was going to buy up the JP

526
00:27:27,600 --> 00:27:30,359
Speaker 4: Morgan references reference to nineteen oh seven when JP Morgan

527
00:27:30,520 --> 00:27:31,879
Speaker 4: and his palace had to come in and kind of

528
00:27:31,880 --> 00:27:34,919
Speaker 4: rescue the financial system from collapse. He was going to

529
00:27:34,920 --> 00:27:36,679
Speaker 4: come in and buy all these companies that were failing,

530
00:27:36,760 --> 00:27:41,040
Speaker 4: right like Celsius and blockfying all these companies. So that

531
00:27:41,119 --> 00:27:45,280
Speaker 4: was the circumstance under which I interviewed him. Boy, I'll

532
00:27:45,280 --> 00:27:47,920
Speaker 4: put it this way. The chapter devoted to that interview

533
00:27:48,200 --> 00:27:52,400
Speaker 4: is entitled The Emperor Is but ass Naked.

534
00:27:54,080 --> 00:27:58,480
Speaker 3: So it was weird. It was really weird because I

535
00:27:58,560 --> 00:28:00,359
Speaker 3: asked him some questions.

536
00:28:02,000 --> 00:28:05,679
Speaker 4: I wanted to understand how he could explain cryptocurrency is

537
00:28:06,119 --> 00:28:09,200
Speaker 4: what good it did? I found that answer very unsatisfying.

538
00:28:10,160 --> 00:28:12,639
Speaker 4: He said he kind of tried to duck it, and

539
00:28:12,720 --> 00:28:17,720
Speaker 4: then he went into remittances or sending payments between borders.

540
00:28:18,000 --> 00:28:20,960
Speaker 4: I had just come from Al Salvador, the only country

541
00:28:21,000 --> 00:28:23,080
Speaker 4: in the world trying to use crypto as real money.

542
00:28:23,720 --> 00:28:26,639
Speaker 4: El Salvador's economy, the foundation, I would argue of El

543
00:28:26,680 --> 00:28:30,040
Speaker 4: Salvador's economy is remittances. A quarter of the Al Savonor

544
00:28:30,160 --> 00:28:33,840
Speaker 4: economy is people of Savador and descent who lived in

545
00:28:33,840 --> 00:28:35,879
Speaker 4: the United States, two to three million of them sending

546
00:28:35,920 --> 00:28:36,360
Speaker 4: money home.

547
00:28:36,880 --> 00:28:38,440
Speaker 3: So the government had.

548
00:28:38,520 --> 00:28:41,360
Speaker 4: You know, for reasons that we could go into in

549
00:28:41,400 --> 00:28:44,360
Speaker 4: another question, had decided to set up a system Chibo wallet,

550
00:28:44,800 --> 00:28:47,000
Speaker 4: and it was suddenly gonna, you know, bring in tourists.

551
00:28:47,040 --> 00:28:49,760
Speaker 4: But it was going to be a way for the

552
00:28:49,760 --> 00:28:54,360
Speaker 4: savonor people to profit by or to not spend money

553
00:28:54,440 --> 00:28:57,240
Speaker 4: on money Gram and Western Union traditional services. And it

554
00:28:57,280 --> 00:28:59,560
Speaker 4: was going to be this huge boon to the economy. Well,

555
00:28:59,640 --> 00:29:02,440
Speaker 4: nobody used it. It was a failure. It was complete

556
00:29:02,440 --> 00:29:06,040
Speaker 4: failure for a lot of the reasons that plague crypto.

557
00:29:06,160 --> 00:29:08,680
Speaker 4: More broadly, the system didn't work. The chi was system

558
00:29:08,760 --> 00:29:11,680
Speaker 4: just like malfunction. All the time, people got defrauded, people

559
00:29:11,720 --> 00:29:16,360
Speaker 4: lost their money, and so they decided they would rather

560
00:29:16,480 --> 00:29:21,000
Speaker 4: stick with traditional services. So, according to the government's own figures,

561
00:29:21,240 --> 00:29:25,840
Speaker 4: less than two percent of remittances used this system. So

562
00:29:25,920 --> 00:29:27,520
Speaker 4: I just come from there and he was saying it's

563
00:29:27,560 --> 00:29:31,960
Speaker 4: remittances and I'm saying, Sam, baloney bs. And then we

564
00:29:31,960 --> 00:29:33,680
Speaker 4: went round around around, and when I came back to

565
00:29:33,720 --> 00:29:35,920
Speaker 4: that same question, because the question was give.

566
00:29:35,760 --> 00:29:37,239
Speaker 3: Me one company.

567
00:29:37,560 --> 00:29:39,160
Speaker 4: Just give me one company, give me one comedy that's

568
00:29:39,200 --> 00:29:41,400
Speaker 4: doing anything, anything of productive value.

569
00:29:41,440 --> 00:29:41,880
Speaker 3: Just tell me.

570
00:29:42,440 --> 00:29:46,800
Speaker 4: And he eventually told me Solana. Well, Solana was known

571
00:29:46,800 --> 00:29:47,960
Speaker 4: as one of Sam's.

572
00:29:47,560 --> 00:29:49,640
Speaker 3: Coins because he owned a lot of it.

573
00:29:49,680 --> 00:29:51,240
Speaker 4: I think it was like a billion dollars worth of

574
00:29:51,240 --> 00:29:54,840
Speaker 4: it when they went when they went kablue. Did he

575
00:29:54,920 --> 00:29:56,800
Speaker 4: really believe in Solana or was he trying to pump

576
00:29:56,800 --> 00:29:59,280
Speaker 4: his bat, like what was that? Also, Solana has the

577
00:29:59,400 --> 00:30:02,960
Speaker 4: unfortunate to shut down. It just stops working. I think

578
00:30:02,960 --> 00:30:05,200
Speaker 4: it stopped working at least a dozen times over the

579
00:30:05,200 --> 00:30:07,560
Speaker 4: course of its history, so that I found those answers

580
00:30:07,640 --> 00:30:09,840
Speaker 4: very unsatisfying. You can't give me one company that's of

581
00:30:09,880 --> 00:30:13,440
Speaker 4: any use in your industry. So there was those questions,

582
00:30:13,480 --> 00:30:14,680
Speaker 4: and then there are questions.

583
00:30:14,360 --> 00:30:18,440
Speaker 3: About his donations. Probably the most.

584
00:30:18,240 --> 00:30:22,000
Speaker 4: Nervous I think he got was seemingly was when he

585
00:30:22,080 --> 00:30:24,120
Speaker 4: wanted to talk about his effective altruism. He's going to

586
00:30:24,160 --> 00:30:26,760
Speaker 4: give his money away, pandemic preparedness, all that stuff. So

587
00:30:26,880 --> 00:30:28,440
Speaker 4: how much money have you given to that stuff? He

588
00:30:28,440 --> 00:30:31,600
Speaker 4: said fifty to one hundred million, So okay, how much

589
00:30:31,640 --> 00:30:36,360
Speaker 4: have you given to politicians? And he froze and he

590
00:30:36,800 --> 00:30:38,720
Speaker 4: turned in his seat and deal with stuff. And you know,

591
00:30:38,760 --> 00:30:40,200
Speaker 4: he's kind of a twitchy guy, and I get that

592
00:30:40,240 --> 00:30:41,600
Speaker 4: he's got add I'm not trying.

593
00:30:41,440 --> 00:30:44,320
Speaker 3: To but like it was weird and he wouldn't tell me.

594
00:30:44,800 --> 00:30:47,000
Speaker 4: And at the time, I'm thinking, this is really strange

595
00:30:47,000 --> 00:30:48,959
Speaker 4: because this information is public, right, Like, I mean, we

596
00:30:49,000 --> 00:30:51,360
Speaker 4: know he gave forty million to Biden. We know his

597
00:30:51,480 --> 00:30:54,040
Speaker 4: core gave twenty three million to the Republicans, Like, why

598
00:30:54,040 --> 00:30:57,000
Speaker 4: doesn't he just and now you know, what's alleged is

599
00:30:57,040 --> 00:30:59,800
Speaker 4: that he was running a ninety three million dollar straw

600
00:30:59,800 --> 00:31:02,640
Speaker 4: don't so maybe I don't know, maybe that was why

601
00:31:03,720 --> 00:31:06,440
Speaker 4: it was a really bizarre interview. It was really one

602
00:31:06,480 --> 00:31:09,640
Speaker 4: of the most strange hours of my life.

603
00:31:09,840 --> 00:31:13,920
Speaker 2: We've we've had our own weird interview with Well that's right, yes.

604
00:31:13,760 --> 00:31:15,640
Speaker 4: Well that was very informative. So, I mean, if you

605
00:31:15,640 --> 00:31:18,080
Speaker 4: don't mind, I'm just gonna you know. So, in the

606
00:31:18,080 --> 00:31:20,080
Speaker 4: spring of that year, he had been on your podcast

607
00:31:20,160 --> 00:31:22,640
Speaker 4: with Matt Levine and he talked about I believe it

608
00:31:22,680 --> 00:31:25,160
Speaker 4: was magic boxes out of which money comes.

609
00:31:25,320 --> 00:31:28,200
Speaker 2: The question was how does yield farming work, right, And

610
00:31:28,240 --> 00:31:31,760
Speaker 2: we were expecting a technical answer of you know, oh,

611
00:31:31,840 --> 00:31:34,280
Speaker 2: there's this protocol and then this protocol.

612
00:31:33,840 --> 00:31:34,800
Speaker 3: Yes, yes, yes.

613
00:31:34,960 --> 00:31:38,440
Speaker 4: Instead it was magic boxes out of which money comes,

614
00:31:38,680 --> 00:31:41,240
Speaker 4: and Matt correctly said that sounds like a Ponzi scheme.

615
00:31:42,760 --> 00:31:44,880
Speaker 4: I think Sam laughed. I don't know what happened after that,

616
00:31:45,680 --> 00:31:49,080
Speaker 4: but it's real. It was really strange for me. I mean,

617
00:31:49,520 --> 00:31:51,880
Speaker 4: I'm you know, I got an ego and stuff, but

618
00:31:51,920 --> 00:31:53,320
Speaker 4: I'm just I have an undergraduate degree.

619
00:31:53,360 --> 00:31:54,560
Speaker 3: I'm I'm an actor.

620
00:31:54,640 --> 00:31:56,880
Speaker 4: I've just been looking at this for a couple of years,

621
00:31:56,880 --> 00:31:59,680
Speaker 4: and I'm here soon talking to the supposed JP Morgan

622
00:31:59,720 --> 00:32:03,880
Speaker 4: a crypt like, can you give me one satisfying answer?

623
00:32:03,880 --> 00:32:06,760
Speaker 4: Can we get one moment where we could kind of

624
00:32:06,800 --> 00:32:09,160
Speaker 4: I could see how this was going to work. I

625
00:32:09,240 --> 00:32:12,680
Speaker 4: left basically with a lot of questions, but they were

626
00:32:12,680 --> 00:32:16,080
Speaker 4: all the same one What the fuck was that all about?

627
00:32:16,160 --> 00:32:18,320
Speaker 3: Like? What was that? It was really weird?

628
00:32:18,560 --> 00:32:23,840
Speaker 2: Yes, all of this sounds familiar. You mentioned law enforcement earlier,

629
00:32:23,960 --> 00:32:27,680
Speaker 2: so again let me ask the basic question, but where

630
00:32:27,720 --> 00:32:31,920
Speaker 2: are the regulators? So we're starting to see some actions now,

631
00:32:32,280 --> 00:32:36,360
Speaker 2: notably from the SEC and the CFTC also sued Finance

632
00:32:36,400 --> 00:32:39,840
Speaker 2: earlier this year. But where have they been and why

633
00:32:39,880 --> 00:32:42,200
Speaker 2: the reluctance to crack down on this industry?

634
00:32:42,320 --> 00:32:42,520
Speaker 3: Yeah?

635
00:32:43,080 --> 00:32:47,760
Speaker 4: So I believe it was twenty fourteen when the CFTC

636
00:32:47,760 --> 00:32:51,240
Speaker 4: Commissioner Tomy the Massad asserted CFTC.

637
00:32:51,040 --> 00:32:53,280
Speaker 3: Control over over bitcoin.

638
00:32:53,400 --> 00:32:59,400
Speaker 4: Said, because there's futures were being traded, and under the CEA,

639
00:32:59,480 --> 00:33:01,600
Speaker 4: the Commodity Change Act making thirty six, they could they

640
00:33:01,600 --> 00:33:05,520
Speaker 4: could argue that the bitcoins of commodity. Okay, so that

641
00:33:05,560 --> 00:33:07,720
Speaker 4: already creates a little bit of a gray area, right

642
00:33:07,760 --> 00:33:12,440
Speaker 4: because if the if bigcoins a commodity, but these, these

643
00:33:12,480 --> 00:33:16,680
Speaker 4: twenty other twenty thousand other cryptos came into existence, what

644
00:33:16,760 --> 00:33:20,920
Speaker 4: are they? You can say the sec hasn't been as

645
00:33:20,920 --> 00:33:24,080
Speaker 4: aggressive as it should have been, and I don't I

646
00:33:24,080 --> 00:33:27,640
Speaker 4: don't disagree with that. I think the politics are interesting.

647
00:33:28,120 --> 00:33:30,600
Speaker 4: I mean, people are now very angry Gary Gensler in

648
00:33:30,600 --> 00:33:35,280
Speaker 4: the crypto industry, and they're angry that he allowed Coinbase

649
00:33:35,320 --> 00:33:38,840
Speaker 4: to go public. Coinbase was listed on April fourteenth, twenty

650
00:33:38,880 --> 00:33:42,280
Speaker 4: twenty one. Gary Gensler assumed office on April seventeenth of

651
00:33:42,320 --> 00:33:44,840
Speaker 4: twenty twenty one. Say what you will about Gensler, but

652
00:33:44,880 --> 00:33:50,920
Speaker 4: he does not have a time machine. So look what.

653
00:33:51,200 --> 00:33:54,280
Speaker 4: Here's what I'll say. Crypto has exploited a gray area

654
00:33:54,560 --> 00:33:58,160
Speaker 4: between how we classify commodity use and securities. I do

655
00:33:58,200 --> 00:34:00,880
Speaker 4: think this is a problem. We are the only country

656
00:34:00,880 --> 00:34:03,440
Speaker 4: in the world that separates our commodities regulation from our

657
00:34:03,480 --> 00:34:06,400
Speaker 4: securities regulation in the way that we do. We have

658
00:34:06,440 --> 00:34:11,920
Speaker 4: two different agencies. They are overseen by different committees in

659
00:34:12,000 --> 00:34:15,640
Speaker 4: both the House and the Senate. That creates really bad incentives.

660
00:34:15,680 --> 00:34:19,160
Speaker 4: As a you know, armchair economist. That's very bad incentive wise, right,

661
00:34:19,239 --> 00:34:23,319
Speaker 4: because people want to get on Politicians want to get

662
00:34:23,320 --> 00:34:29,600
Speaker 4: on elected members want to get on those committees to oversee.

663
00:34:27,760 --> 00:34:31,080
Speaker 3: The industries, but also to get donations, right.

664
00:34:31,640 --> 00:34:36,839
Speaker 4: And the regulators are fighting for turf, sometimes friendly, sometimes not.

665
00:34:37,960 --> 00:34:41,319
Speaker 4: The crypto industry really really wants the CFTC to be

666
00:34:41,360 --> 00:34:44,479
Speaker 4: in charge. The CFDC is the smaller agency. It's about

667
00:34:44,480 --> 00:34:47,400
Speaker 4: a quarter of the budget a quarter of the budget

668
00:34:47,440 --> 00:34:51,840
Speaker 4: of the SEC. So there's a lot of blame to

669
00:34:51,840 --> 00:34:55,360
Speaker 4: go around, I would say. But in the defense of regulators,

670
00:34:55,400 --> 00:34:58,080
Speaker 4: it does take time to build cases, to be photographies

671
00:34:58,080 --> 00:34:59,000
Speaker 4: and how to require a law.

672
00:35:15,640 --> 00:35:18,560
Speaker 1: You know, we've talked a lot about the industry, but

673
00:35:18,719 --> 00:35:21,480
Speaker 1: your story starts with like a friend, and obviously a

674
00:35:21,480 --> 00:35:23,799
Speaker 1: lot of people have lost a ton of money.

675
00:35:25,560 --> 00:35:26,720
Speaker 3: Over the last couple of years.

676
00:35:26,880 --> 00:35:29,000
Speaker 1: Particularly, Can you talk a little bit more in the

677
00:35:29,040 --> 00:35:32,280
Speaker 1: course of your reporting, like truly the types of people

678
00:35:32,320 --> 00:35:34,360
Speaker 1: that you met on just this sort of like the buyers,

679
00:35:34,400 --> 00:35:36,520
Speaker 1: like the people who liked sucked in at the top.

680
00:35:37,239 --> 00:35:37,960
Speaker 3: It's everybody.

681
00:35:38,000 --> 00:35:40,040
Speaker 4: I mean, it's really fascinating. Like you could interview and

682
00:35:40,080 --> 00:35:42,040
Speaker 4: I did. I interviewed everyone from you know, kind of

683
00:35:42,239 --> 00:35:45,440
Speaker 4: regular traders. I walked around the Bitcoin conference in Miami

684
00:35:45,520 --> 00:35:47,200
Speaker 4: last year just talking to random people.

685
00:35:48,520 --> 00:35:50,440
Speaker 3: And then of course there are more sophisticated players.

686
00:35:50,440 --> 00:35:53,359
Speaker 4: There are hedge funds, they're you know, high frequency trading

687
00:35:53,360 --> 00:35:54,080
Speaker 4: firms things like that.

688
00:35:55,920 --> 00:35:59,520
Speaker 3: And then there are the sort of the core players.

689
00:35:59,120 --> 00:36:02,040
Speaker 4: Which you know, we're Sam and CZ and you know,

690
00:36:02,080 --> 00:36:07,040
Speaker 4: the folks that are kind of facilitating these transactions. So

691
00:36:07,160 --> 00:36:09,920
Speaker 4: amongst the kind of the regular folks. Again, I kind

692
00:36:09,920 --> 00:36:12,680
Speaker 4: of go back to this point of like crypto just

693
00:36:12,680 --> 00:36:13,960
Speaker 4: becomes whatever you want.

694
00:36:13,800 --> 00:36:17,480
Speaker 3: It to become. Right, It's like it's a way of.

695
00:36:17,400 --> 00:36:22,439
Speaker 4: You expressing your like your your freedom, your you know,

696
00:36:23,080 --> 00:36:26,080
Speaker 4: get off the shackles of tradfy and like find your own,

697
00:36:26,480 --> 00:36:30,520
Speaker 4: create your own financial destiny kind of stuff. And I

698
00:36:30,600 --> 00:36:35,600
Speaker 4: get that that that is such an intoxicating pitch sales pitch.

699
00:36:35,880 --> 00:36:38,520
Speaker 4: That's why Schiller talks about these narratives and how powerful

700
00:36:38,560 --> 00:36:40,800
Speaker 4: they can be and how difficult they are to It

701
00:36:40,880 --> 00:36:43,520
Speaker 4: compares them to to viruses. You know, it's sort of

702
00:36:43,640 --> 00:36:45,759
Speaker 4: you have to study the epidemiology of them, and we

703
00:36:45,840 --> 00:36:49,719
Speaker 4: kind of have to you know, reach herd immunity here,

704
00:36:49,760 --> 00:36:51,719
Speaker 4: which I think we kind of are getting to now

705
00:36:51,760 --> 00:36:52,280
Speaker 4: in crypto.

706
00:36:52,920 --> 00:36:56,680
Speaker 3: But it's also very sad because I tell a story

707
00:36:56,719 --> 00:36:58,319
Speaker 3: at the end of the book about a particular case.

708
00:36:58,320 --> 00:37:01,960
Speaker 3: It's pretty pretty rough. But you are also getting into.

709
00:37:03,239 --> 00:37:06,239
Speaker 4: Gambling addiction. I mean, let's be honest, it's young men.

710
00:37:06,760 --> 00:37:10,400
Speaker 4: Forty two percent of men eighteen to twenty nine have

711
00:37:10,719 --> 00:37:12,319
Speaker 4: purchased US bought cryptocurrency.

712
00:37:12,320 --> 00:37:13,839
Speaker 3: That's a big number. Almost half.

713
00:37:15,640 --> 00:37:20,239
Speaker 4: It's gamified, right, the apps are. It's very similarish to

714
00:37:20,360 --> 00:37:25,440
Speaker 4: robin Hood, but unregulated, and it's easy to hide from

715
00:37:25,480 --> 00:37:28,800
Speaker 4: friends and family, I mean gambling addiction. We talked to

716
00:37:28,880 --> 00:37:31,479
Speaker 4: some gambling experts for this and they told us that

717
00:37:32,320 --> 00:37:36,440
Speaker 4: there's a husband wife. They run a boutique firm in Brooklyn,

718
00:37:36,440 --> 00:37:38,680
Speaker 4: but that services a lot of Wall Street clients and

719
00:37:38,719 --> 00:37:42,360
Speaker 4: so they're treating all kinds of addictions. But they saw

720
00:37:43,000 --> 00:37:46,280
Speaker 4: a trickle during the last craze of twenty eighteen twenty seventeen,

721
00:37:46,480 --> 00:37:48,560
Speaker 4: but they saw a tsunami recently.

722
00:37:48,880 --> 00:37:52,520
Speaker 3: It's just it was all men under forty. Some of

723
00:37:52,520 --> 00:37:52,959
Speaker 3: them are.

724
00:37:52,880 --> 00:37:56,759
Speaker 4: Sophisticated Wall Street guys, sophisticated in people that really know

725
00:37:56,800 --> 00:37:59,239
Speaker 4: their stuff about all sorts of other financial stuff.

726
00:38:00,040 --> 00:38:01,560
Speaker 3: But have gotten drawn in.

727
00:38:02,920 --> 00:38:05,640
Speaker 4: And everything down to teenagers. I mean parents coming in

728
00:38:05,680 --> 00:38:08,960
Speaker 4: with their teenagers saying they're gambling away their their minimum

729
00:38:08,960 --> 00:38:11,280
Speaker 4: wage job, you know, their summer job, paycheck on this stuff.

730
00:38:11,960 --> 00:38:14,080
Speaker 3: And that's where it gets into the casino capitalism.

731
00:38:14,160 --> 00:38:15,640
Speaker 4: That's why I want the book to be about more

732
00:38:15,680 --> 00:38:18,480
Speaker 4: than just crypto, because I do worry that we are

733
00:38:19,760 --> 00:38:23,160
Speaker 4: Canes said this actually you know when I won't try

734
00:38:23,200 --> 00:38:26,480
Speaker 4: to quote him exactly, but basically, when you turn the

735
00:38:26,560 --> 00:38:32,040
Speaker 4: nation's capital into capital markets into a casino, you know

736
00:38:32,080 --> 00:38:34,040
Speaker 4: the job is likely to be ill done. You are

737
00:38:34,040 --> 00:38:39,800
Speaker 4: not servicing an effective use of capital. And I believe

738
00:38:39,840 --> 00:38:41,919
Speaker 4: we need to look at some of these things through

739
00:38:41,960 --> 00:38:45,279
Speaker 4: the lens of how much social harm they can do.

740
00:38:46,640 --> 00:38:49,640
Speaker 4: Gambling addiction, I've heard from several people, has the highest

741
00:38:49,680 --> 00:38:51,200
Speaker 4: rate of suicide of all the addictions.

742
00:38:51,400 --> 00:38:53,719
Speaker 3: It's much easier to hide because all you need is a.

743
00:38:53,680 --> 00:38:56,040
Speaker 4: Phone and a few minutes or even seconds to make

744
00:38:56,080 --> 00:38:58,959
Speaker 4: some trades, and so by the time families find out

745
00:38:59,120 --> 00:39:02,920
Speaker 4: about the predictive that usually their son or husband partner

746
00:39:03,200 --> 00:39:06,839
Speaker 4: is in, it can be too late and money's gone.

747
00:39:07,000 --> 00:39:07,760
Speaker 3: It is treatable.

748
00:39:08,440 --> 00:39:10,799
Speaker 4: It is a retreatable addiction, but you have to take

749
00:39:10,800 --> 00:39:13,279
Speaker 4: some pretty serious measures sometimes and remove the ability to

750
00:39:13,760 --> 00:39:14,520
Speaker 4: make the trades and.

751
00:39:14,440 --> 00:39:15,800
Speaker 3: To actually access the accounts.

752
00:39:16,960 --> 00:39:18,840
Speaker 4: So yeah, I'm not to turn it into a bummer,

753
00:39:18,840 --> 00:39:20,480
Speaker 4: but like, I really think we need to talk about

754
00:39:20,520 --> 00:39:23,760
Speaker 4: these things, because the marketing was, of course the exact opposite.

755
00:39:23,800 --> 00:39:26,040
Speaker 3: It was all the shiny stuff and all the amazing things.

756
00:39:26,080 --> 00:39:28,880
Speaker 4: But when you come down to it, economically speaking, cryptos

757
00:39:29,000 --> 00:39:31,080
Speaker 4: a zero something game. It's poker because it doesn't do

758
00:39:31,120 --> 00:39:34,680
Speaker 4: anything productive, is strictly competitive. For someone to win, someone

759
00:39:34,719 --> 00:39:36,919
Speaker 4: else has to lose. But it's not a fair game.

760
00:39:36,960 --> 00:39:38,480
Speaker 4: You're not playing in a rate. You're not playing in

761
00:39:38,560 --> 00:39:41,680
Speaker 4: Vegas now. You're playing in Vegas in the fifties.

762
00:39:41,400 --> 00:39:42,960
Speaker 3: When the mafia rend, you know what I mean.

763
00:39:43,480 --> 00:39:47,080
Speaker 4: And then like Vegas, where there's entertainment value, you get comps,

764
00:39:47,120 --> 00:39:49,319
Speaker 4: some drinks, have a dinner, see a show. You know,

765
00:39:49,360 --> 00:39:51,719
Speaker 4: Cryptos like Vegas without the drinks, the dinner or the show.

766
00:39:53,680 --> 00:39:56,680
Speaker 4: So you're gonna lose. You know you're gonna lose. Ninety

767
00:39:56,719 --> 00:39:57,960
Speaker 4: nine percent of people are gonna lose.

768
00:39:58,520 --> 00:40:00,839
Speaker 2: In the book, you actually talk talk quite a bit

769
00:40:00,880 --> 00:40:05,239
Speaker 2: about the overlap between online poker and crypto, and you

770
00:40:05,320 --> 00:40:09,680
Speaker 2: almost almost draw connection between the end of online poker

771
00:40:09,920 --> 00:40:12,919
Speaker 2: and the beginning of Bitcoin talk to us more about

772
00:40:12,920 --> 00:40:14,120
Speaker 2: the overlap that you see there.

773
00:40:14,239 --> 00:40:16,880
Speaker 4: Sure, so in the original code that became the Bitcoin

774
00:40:17,200 --> 00:40:22,360
Speaker 4: white white paper code, there's a poker lobby. So whoever

775
00:40:22,400 --> 00:40:27,360
Speaker 4: Satosh and a Kamoto is was whoever they are, we

776
00:40:27,440 --> 00:40:30,799
Speaker 4: do know they were interested in poker at the tame

777
00:40:31,600 --> 00:40:34,200
Speaker 4: similar time to when the Bitcoin White Paper came out,

778
00:40:34,600 --> 00:40:35,680
Speaker 4: online poker.

779
00:40:35,440 --> 00:40:39,640
Speaker 3: Was about to get crushed. It had moved overseas.

780
00:40:41,239 --> 00:40:44,040
Speaker 4: All these online poker rooms had been set up, and

781
00:40:44,080 --> 00:40:47,040
Speaker 4: eventually the government got around to to shutting them down

782
00:40:47,800 --> 00:40:50,120
Speaker 4: on you know what's become famous as Black Friday and

783
00:40:50,719 --> 00:40:53,840
Speaker 4: online poker, and it was because they were cheating their customers.

784
00:40:54,800 --> 00:41:00,759
Speaker 4: There's a company called Ultimate Bet that was had a

785
00:41:00,760 --> 00:41:05,400
Speaker 4: secret god mode where insiders could see the other players cards. Uh.

786
00:41:05,560 --> 00:41:09,440
Speaker 4: The compliance officer for the holding company of SCAPSA of

787
00:41:09,560 --> 00:41:12,239
Speaker 4: Ultimate Bet is a guy named Stuart Stuart Hogner. He's

788
00:41:12,280 --> 00:41:19,440
Speaker 4: now Tether's general counsel. Daniel Friedberg. Also, Daniel Friedberg also

789
00:41:20,160 --> 00:41:21,799
Speaker 4: worked at SCAPSA.

790
00:41:22,800 --> 00:41:26,000
Speaker 3: He was ftx's lawyer.

791
00:41:26,440 --> 00:41:29,600
Speaker 4: They think he then became their chief regulatory officer or

792
00:41:29,600 --> 00:41:37,080
Speaker 4: something like that. Interesting, where were the signs? They're really

793
00:41:37,120 --> 00:41:41,080
Speaker 4: strong parallel, So maybe crypto's maybe bitcoin was set up

794
00:41:41,080 --> 00:41:44,080
Speaker 4: to be this emancipatory new form of peer to peer currency,

795
00:41:45,200 --> 00:41:47,480
Speaker 4: or maybe it was literally online gambling two point zero

796
00:41:48,400 --> 00:41:52,040
Speaker 4: a way of a way of moving money overseas and

797
00:41:52,360 --> 00:41:54,200
Speaker 4: you know, using it to facilitate gam you know.

798
00:41:54,280 --> 00:41:56,400
Speaker 1: One thing that you've talked about, and I think it's

799
00:41:56,600 --> 00:41:59,960
Speaker 1: it might be it's probably There's probably been other cases

800
00:42:00,160 --> 00:42:02,759
Speaker 1: like this, but there's a lot of there's been a

801
00:42:02,840 --> 00:42:05,280
Speaker 1: lot of pure pressure in crypto. It's like people telling

802
00:42:05,320 --> 00:42:07,520
Speaker 1: their friend it's like you've got to get into the

803
00:42:08,000 --> 00:42:10,719
Speaker 1: your friend, or just being told online have fun to

804
00:42:10,760 --> 00:42:12,239
Speaker 1: stay poor if.

805
00:42:12,200 --> 00:42:14,600
Speaker 3: You don't, they don't. They tried that line on me.

806
00:42:16,239 --> 00:42:19,920
Speaker 1: But like, you know, that's wasn't there in like online poker,

807
00:42:20,000 --> 00:42:21,600
Speaker 1: like that degree to which like the sort of like

808
00:42:21,640 --> 00:42:23,759
Speaker 1: crowd whips its own members into a friends face.

809
00:42:24,000 --> 00:42:25,560
Speaker 4: Yeah, and that's where I think you get into a

810
00:42:25,640 --> 00:42:29,160
Speaker 4: multi level market marketing scheme. The abuse of language is similar,

811
00:42:29,680 --> 00:42:32,839
Speaker 4: the way that they're sort of twisting words and trying

812
00:42:32,880 --> 00:42:35,719
Speaker 4: to create a pressure filled environment where you feel like,

813
00:42:36,120 --> 00:42:37,920
Speaker 4: you know, fomo, you're you're going to miss out if

814
00:42:37,920 --> 00:42:40,319
Speaker 4: you don't invest. Now you know really quick, you got

815
00:42:40,400 --> 00:42:42,279
Speaker 4: you gotta really quickly invest in the future of money,

816
00:42:42,280 --> 00:42:44,839
Speaker 4: because otherwise you're not going to get in there, which

817
00:42:44,880 --> 00:42:49,360
Speaker 4: is a bizarre but those tactics are very similar. And

818
00:42:49,560 --> 00:42:51,399
Speaker 4: I would say, here's the thing that's a big tell

819
00:42:51,440 --> 00:42:55,279
Speaker 4: of me. The use of the word community. The use

820
00:42:55,320 --> 00:42:59,840
Speaker 4: of the word community is just fascinating. You're not an investor,

821
00:43:00,640 --> 00:43:04,680
Speaker 4: you're not a client or a sucker. You're a member

822
00:43:04,719 --> 00:43:07,279
Speaker 4: of a community. I'm going to be reborn to the

823
00:43:07,320 --> 00:43:08,280
Speaker 4: land of the free.

824
00:43:08,840 --> 00:43:12,080
Speaker 3: Strange to characterize a financial relationship, especially with people you

825
00:43:12,120 --> 00:43:13,880
Speaker 3: don't even know, right, I mean, so much of this

826
00:43:13,920 --> 00:43:16,640
Speaker 3: stuff is done online and through synonymous accounts.

827
00:43:18,000 --> 00:43:22,640
Speaker 4: That's your community. I'm not saying people don't find community.

828
00:43:22,920 --> 00:43:25,680
Speaker 4: What's interesting is some of the strongest communities I've found

829
00:43:25,840 --> 00:43:30,600
Speaker 4: are the participants in the class action lawsuits against companies

830
00:43:30,640 --> 00:43:34,400
Speaker 4: that have allegedly defrauded them because they're bound by the

831
00:43:34,440 --> 00:43:37,160
Speaker 4: fact that they had a similar experience where they they

832
00:43:37,480 --> 00:43:40,000
Speaker 4: had a lot of high hopes and then they were

833
00:43:40,080 --> 00:43:40,520
Speaker 4: let down.

834
00:43:41,560 --> 00:43:43,839
Speaker 2: It is true. No one talks about the community of

835
00:43:43,960 --> 00:43:47,279
Speaker 2: like T bill investors. Yeah, exactly, it's not really a thing.

836
00:43:48,440 --> 00:43:51,759
Speaker 2: Let me ask a devil's advocate question. But you know,

837
00:43:51,800 --> 00:43:55,440
Speaker 2: we've been talking about cryptocurrency mostly as a monolith. We

838
00:43:55,520 --> 00:43:59,560
Speaker 2: did touch on the narrative flexibility around bitcoin, so the

839
00:43:59,600 --> 00:44:02,400
Speaker 2: idea that it can be many things to many people

840
00:44:02,560 --> 00:44:05,800
Speaker 2: all at once. One of the things that it seems

841
00:44:05,800 --> 00:44:07,960
Speaker 2: to be now, or at least there are some people

842
00:44:08,000 --> 00:44:12,360
Speaker 2: pushing the story is the anti crypto. So if you

843
00:44:12,480 --> 00:44:18,200
Speaker 2: lost money in some random coin because of a centralized

844
00:44:18,239 --> 00:44:21,680
Speaker 2: exchange that did something bad, you should buy bitcoin because

845
00:44:21,719 --> 00:44:25,480
Speaker 2: it's truly decentralized and only you have access to it

846
00:44:25,520 --> 00:44:28,799
Speaker 2: in your cold storage wallet or whatever. How valid do

847
00:44:28,840 --> 00:44:30,040
Speaker 2: you think that argument is?

848
00:44:30,400 --> 00:44:32,880
Speaker 4: So you're saying you need to be more pure, you

849
00:44:32,920 --> 00:44:35,560
Speaker 4: need to believe more in the decentralization.

850
00:44:35,640 --> 00:44:37,960
Speaker 2: If you don't like crypto, you should buy the original.

851
00:44:37,560 --> 00:44:44,080
Speaker 3: Crypto exactly exactly. Not a cult, I think. So that's

852
00:44:44,080 --> 00:44:44,840
Speaker 3: the flip and answer.

853
00:44:44,880 --> 00:44:47,080
Speaker 4: On one level, there is some truth in the sense

854
00:44:47,120 --> 00:44:50,160
Speaker 4: that bitcoin is more decentralized by nature of the proof

855
00:44:50,200 --> 00:44:53,319
Speaker 4: of work, but that cuts the other way too, because

856
00:44:53,360 --> 00:44:56,360
Speaker 4: of course proof of work means it can't scale. Bitcoin

857
00:44:56,400 --> 00:44:59,680
Speaker 4: can only process five to seven transactions a second. It

858
00:44:59,719 --> 00:45:03,319
Speaker 4: hits limit, it hits what's called a red queen's race,

859
00:45:03,360 --> 00:45:05,640
Speaker 4: where like you're using more and more energy depending on

860
00:45:05,680 --> 00:45:08,799
Speaker 4: how many competitors are there. The more competitors come in,

861
00:45:08,880 --> 00:45:11,280
Speaker 4: the more energy is expended for the same same block.

862
00:45:11,920 --> 00:45:13,960
Speaker 4: So you know, it's like what the what the queen

863
00:45:14,040 --> 00:45:16,000
Speaker 4: says to Alice, Right, You're gonna run twice as fast

864
00:45:16,040 --> 00:45:19,840
Speaker 4: to get anywhere. It also, because of that energy usage

865
00:45:20,000 --> 00:45:22,000
Speaker 4: has an environmental problem. I mean, I went to the

866
00:45:22,040 --> 00:45:23,880
Speaker 4: biggest crypto mind in the country. It's outside of my

867
00:45:23,960 --> 00:45:26,920
Speaker 4: hometown of Austin, Rockdale, Texas. It took over a former

868
00:45:26,960 --> 00:45:30,120
Speaker 4: Alco aluminum smelting plant. And the reason it took that

869
00:45:30,200 --> 00:45:31,960
Speaker 4: over is because it's connected to the grid, so it

870
00:45:32,000 --> 00:45:35,160
Speaker 4: can handle a lot of power. You know, in twenty

871
00:45:35,200 --> 00:45:39,840
Speaker 4: twenty one, the Bitcoin network and other cryptocurrencies used the

872
00:45:39,960 --> 00:45:43,920
Speaker 4: energy equivalent of Argentina, the entire country. That's a problem

873
00:45:44,000 --> 00:45:46,239
Speaker 4: if you view it as I do, as a zero

874
00:45:46,360 --> 00:45:49,279
Speaker 4: sum game. It's not doing anything productive and you're using

875
00:45:49,280 --> 00:45:52,319
Speaker 4: a lot of energy. So on one level, you could

876
00:45:52,320 --> 00:45:55,440
Speaker 4: make the argument, oh, you're you know, you're more pure,

877
00:45:55,520 --> 00:45:59,279
Speaker 4: you're more decentralized. But in terms of stepping back for

878
00:46:00,080 --> 00:46:05,440
Speaker 4: the rest of us, why why should why should this

879
00:46:05,480 --> 00:46:08,040
Speaker 4: can why should at least at least not be taxed

880
00:46:08,080 --> 00:46:10,640
Speaker 4: at an extraordinary level.

881
00:46:10,760 --> 00:46:13,080
Speaker 1: Real quickly, we just have a couple mints left. You know,

882
00:46:13,160 --> 00:46:15,600
Speaker 1: you mentioned we're to use the virus analogy and you

883
00:46:15,600 --> 00:46:17,960
Speaker 1: talk about maybe reaching herd immunity. And then the question

884
00:46:18,080 --> 00:46:20,600
Speaker 1: is like, is there some pool of new money or

885
00:46:20,640 --> 00:46:23,040
Speaker 1: new people that could be brought in to like keep

886
00:46:23,040 --> 00:46:25,239
Speaker 1: it going, Like do you think that like the sort

887
00:46:25,280 --> 00:46:27,799
Speaker 1: of potential pool of would be crypto buyers are more

888
00:46:27,880 --> 00:46:29,120
Speaker 1: or less exhausted.

889
00:46:29,760 --> 00:46:32,520
Speaker 3: Well, it has utility, you know, for gambling. I mean,

890
00:46:32,520 --> 00:46:34,000
Speaker 3: you can gamble in anything, so I don't think that

891
00:46:34,040 --> 00:46:34,760
Speaker 3: makes it unique.

892
00:46:34,760 --> 00:46:37,400
Speaker 4: But it has utilities as a gambling device, and it

893
00:46:37,400 --> 00:46:39,520
Speaker 4: has utility to facilitate crime because you can use it

894
00:46:39,520 --> 00:46:43,920
Speaker 4: for money laundering and avoiding capital controls, tax evasion, sanctionization, whatever.

895
00:46:44,040 --> 00:46:46,239
Speaker 4: And I understand that there's there's an arguments like some

896
00:46:46,280 --> 00:46:47,839
Speaker 4: of that's good, right, we don't like some of these

897
00:46:48,000 --> 00:46:51,600
Speaker 4: authoritarian governments, Okay, sure, But also if it goes that way,

898
00:46:51,640 --> 00:46:52,960
Speaker 4: it also has to go the other way, right, If

899
00:46:53,000 --> 00:46:54,400
Speaker 4: the good guys can use it, the bad guys can

900
00:46:54,480 --> 00:46:54,719
Speaker 4: use it.

901
00:46:56,040 --> 00:47:01,160
Speaker 3: So yeah, I just yeah, I don't know how to

902
00:47:01,320 --> 00:47:02,240
Speaker 3: answer that question.

903
00:47:03,840 --> 00:47:06,880
Speaker 2: Actually maybe a related question, but are you planning to

904
00:47:06,880 --> 00:47:07,560
Speaker 2: write another book.

905
00:47:07,600 --> 00:47:10,719
Speaker 4: What's next, Well, I've filmed a lot of these conversations,

906
00:47:10,719 --> 00:47:15,560
Speaker 4: so I'm working on a documentary and yeah, I don't know.

907
00:47:15,640 --> 00:47:17,600
Speaker 4: I mean, I've had such a blast on this book.

908
00:47:17,600 --> 00:47:19,680
Speaker 4: It's been such an adventure. I think the best part.

909
00:47:19,800 --> 00:47:21,480
Speaker 4: I know it's a cliche, but it's really the people

910
00:47:21,480 --> 00:47:24,279
Speaker 4: I've met, especially the skeptics. Skeptics are just a great

911
00:47:24,320 --> 00:47:28,880
Speaker 4: group of eccentric, wonderful, you know, nerds like we're just

912
00:47:28,920 --> 00:47:32,840
Speaker 4: it's just fun and it's opened up my view of

913
00:47:32,880 --> 00:47:36,880
Speaker 4: the world. I just have this much more I just understand.

914
00:47:37,040 --> 00:47:40,680
Speaker 4: I think I'm not saying I just have a much

915
00:47:40,719 --> 00:47:42,959
Speaker 4: more varied experience in the world, right, Like, it's really

916
00:47:42,960 --> 00:47:43,760
Speaker 4: been an adventure.

917
00:47:44,320 --> 00:47:46,839
Speaker 3: So yeah, I don't know what the.

918
00:47:46,760 --> 00:47:48,759
Speaker 4: Next book is, but I really appreciate that everyone asked

919
00:47:48,760 --> 00:47:50,680
Speaker 4: you that just as soon as your first book that's

920
00:47:50,719 --> 00:47:51,399
Speaker 4: not even out yet.

921
00:47:52,719 --> 00:47:55,239
Speaker 1: Ben Mackenzie, thank you so much for joining us the

922
00:47:55,239 --> 00:47:59,600
Speaker 1: book Easy Money July teen. Thank you, congratulations, and thank

923
00:47:59,640 --> 00:48:16,600
Speaker 1: you so much for coming on up. I really enjoyed

924
00:48:16,680 --> 00:48:18,799
Speaker 1: talking to Ben. You know, I feel like we're so

925
00:48:19,120 --> 00:48:21,920
Speaker 1: in this uh you know, follow the crypto stories so much.

926
00:48:22,320 --> 00:48:24,239
Speaker 1: It's good to sort of zoom out a little bit

927
00:48:24,280 --> 00:48:26,000
Speaker 1: and talk to someone who kind of came at it

928
00:48:26,000 --> 00:48:26,560
Speaker 1: with fresh eyees.

929
00:48:26,680 --> 00:48:29,120
Speaker 2: Well, totally and to his point, it was all about

930
00:48:29,120 --> 00:48:32,600
Speaker 2: the outsider perspective. So it was a fun conversation.

931
00:48:32,840 --> 00:48:33,640
Speaker 3: Shall we leave it there?

932
00:48:33,719 --> 00:48:34,520
Speaker 1: Let's leave it there.

933
00:48:34,840 --> 00:48:37,640
Speaker 2: This has been another episode of the All Thoughts podcast.

934
00:48:37,719 --> 00:48:40,239
Speaker 2: I'm Tracy Alloway. You can follow me on Twitter at

935
00:48:40,239 --> 00:48:41,239
Speaker 2: Tracy Alloway, and.

936
00:48:41,200 --> 00:48:44,160
Speaker 1: I'm Joe Wisenthal. You can follow me on Twitter at

937
00:48:44,160 --> 00:48:48,080
Speaker 1: the Stalwart. Follow our guest Ben mackenzie. He's at Ben McKenzie.

938
00:48:48,440 --> 00:48:52,040
Speaker 1: Follow our producers Carmen Rodriguez at Carmen Arman and dash

939
00:48:52,080 --> 00:48:54,680
Speaker 1: Oll Bennett at dashbot. And check out all of the

940
00:48:54,680 --> 00:48:58,719
Speaker 1: Bloomberg podcasts under the handle at podcasts. And for more

941
00:48:58,760 --> 00:49:01,760
Speaker 1: odd Lads content, go to Bloomberg dot com slash odd Lots,

942
00:49:01,960 --> 00:49:04,480
Speaker 1: where we plush the transcripts. We have a blog and

943
00:49:04,560 --> 00:49:07,399
Speaker 1: a newsletter that comes out every Friday. And for more

944
00:49:07,440 --> 00:49:11,160
Speaker 1: odd Lots content go to discord dot gg slash odd Lots.

945
00:49:11,200 --> 00:49:13,719
Speaker 1: People are in their twenty four to seven talk about

946
00:49:13,760 --> 00:49:16,439
Speaker 1: all types of topics that we talk about on the show,

947
00:49:16,800 --> 00:49:18,280
Speaker 1: including crypto.

948
00:49:18,080 --> 00:49:22,799
Speaker 2: And stream Bloomberg TV on Apple Originals, Roku, Samsung, or

949
00:49:22,840 --> 00:49:25,920
Speaker 2: any other streaming platform, and make sure to tune in

950
00:49:26,000 --> 00:49:28,600
Speaker 2: on Bloomberg TV at ten pm Eastern.

951
00:49:29,040 --> 00:49:30,560
Speaker 1: Thanks for listening and thanks for watching.