Speaker 1: Hello, and welcome to another episode of The Markma Show,
Speaker 1: where we talk about the world changing right before our
Speaker 1: very eyes through what I'm calling the decentralized Revolution. Three
Speaker 1: converging forces changing the world. Of course, those are politics, finance,
Speaker 1: and technology, And of course the technology is the biggest piece.
Speaker 1: We're talking about bitcoin cryptocurrencies because as we go back
Speaker 1: through thousands of years of history, it's always the technology
Speaker 1: that changes the world. And while changes happen over decades, UM,
Speaker 1: a lot of times when you're looking at it so close,
Speaker 1: you don't really see the changes, but if you zoom in,
Speaker 1: you can see them all around. And that's exactly what
Speaker 1: I'm doing today, trying to bring to you the best education,
Speaker 1: the most up to date news, UM, and uh, some
Speaker 1: interesting people to hear from, so you don't have to
Speaker 1: listen to me all the time, so you can get
Speaker 1: some different perspectives. But uh, there is so much news
Speaker 1: going on in the big thing that's going on really
Speaker 1: in the bitcoin crypto space is um, let's call it
Speaker 1: the Great Unwind. Maybe I just made that up. I
Speaker 1: don't know if I've heard that before, the Great Unwind,
Speaker 1: but that's exactly what's happening the leverage, and that's the keyword.
Speaker 1: Leverage that's been built up in the system is now
Speaker 1: de leveraging went from leverage to d leverage. Now leverage
Speaker 1: is is a tool. I like to say that leverage
Speaker 1: is like a fire. Leverage is like fire. So leverage
Speaker 1: could leverage like fire. Fire could be used to warm
Speaker 1: my house in the winter and I could save my life.
Speaker 1: Um or it could burn my whole house down. And
Speaker 1: that's sort of like what we're seeing. So we could
Speaker 1: call it a double edged sword. It can cut my enemy,
Speaker 1: it can cut me. I have to be careful with it.
Speaker 1: And so that's what leverage is. Now. Leverage helps us
Speaker 1: to grow faster, that's the positive benefits of leverage, and
Speaker 1: then it tears us down faster. So a couple of
Speaker 1: examples of this would be, um, let's say that my
Speaker 1: business is booming because the FED printed a bunch of
Speaker 1: money and I have a way more customers than I
Speaker 1: ever had before. More people want to fill in the
Speaker 1: blank whatever kind of buy and us. Let's say I'm
Speaker 1: a home service based business. So people want to remodel
Speaker 1: their homes, they want to buy new mini blinds, put
Speaker 1: jacuzzis in remodel their bathrooms whatever, fill in the blank, X,
Speaker 1: y Z, and so, shoot, man, I'm booked out. I
Speaker 1: can't get to the appointments fast enough. I hire new people.
Speaker 1: I have to buy new trucks. I get a couple
Speaker 1: of new trucks to get the new people in there
Speaker 1: going out there. I gotta buy a new equipment to
Speaker 1: get these things built and serviced and installed. Business is booming,
Speaker 1: it's never been better. And in order to grow faster,
Speaker 1: to keep up with that demand, would use leverage. The
Speaker 1: leverage would be credit. So now borrowing money, I'm using
Speaker 1: credit lines. I'm using leverage to buy those trucks, to
Speaker 1: buy that equipment. And of course it's great because all
Speaker 1: this new business is making up way more than what
Speaker 1: those payments are on those trucks or that new office
Speaker 1: or that equipment that I had to buy. So you know,
Speaker 1: I bought a new machine, it's a hundred thousand dollars,
Speaker 1: my payments whatever, five hundred bucks a month, but it's
Speaker 1: making me five thousand dollars a month. So it's like, hey,
Speaker 1: I'll pay five a month in debt to get the
Speaker 1: five thousand a month it's making me. That's great, And
Speaker 1: so that leverage. That debt allows me to grow really
Speaker 1: fast and keep up with that. But the problem is
Speaker 1: when the market shuts off, my phone is not ringing
Speaker 1: and I'm not getting new customers, and that machine is
Speaker 1: not running. How do I afford to pay for all
Speaker 1: that debt? And just as fast as it built up,
Speaker 1: it gets wiped out. All the debt just evaporates and
Speaker 1: it clears out. And that's exactly what's happening um in
Speaker 1: all the markets in UH, in the stock markets, in
Speaker 1: the housing markets, but it's specifically been really, really painful
Speaker 1: in the cryptocurrency markets. We've been talking about this for
Speaker 1: several weeks now, and really we went super deep when
Speaker 1: we saw Tara Luna meltdown. Tara Luna was supposed to
Speaker 1: be a stable coin. I'm not gonna go super deep
Speaker 1: into this. I've already broken this down. You can go
Speaker 1: check out Mark moss Um podcast, Mark moss I Heart
Speaker 1: Mark moss Podcast, and you can find all my back issues.
Speaker 1: So dig back a couple of weeks, just go through.
Speaker 1: You'll see where I talked about Terry Lune. I broke
Speaker 1: down the mechanism, how it worked, how they use leverage
Speaker 1: to build it up, how it was like a Ponzi
Speaker 1: and how on wines. But the problem is as Tara
Speaker 1: Luna unwound, which I was about a sixty billion dollar
Speaker 1: valuation at the time. Now to put that into perspective,
Speaker 1: you remember the Great Financial Crash, you know, two thousand eight,
Speaker 1: the Great Financial crash, you know, when the entire global
Speaker 1: banking system was basically crashing at the same time. Well,
Speaker 1: if you remember that, um, there was a spark that
Speaker 1: really led to that. Of course, that was Lehman Brothers.
Speaker 1: Lehman Brothers went bankrupt and Lehman Brothers was worth about
Speaker 1: sixty billion dollars at the time, So we're talking about
Speaker 1: about the same magnitude. And what happened when when when
Speaker 1: Lehman Brothers went down, all the other banks that were
Speaker 1: caught up with I had loaned money. There were also
Speaker 1: caught up, and then they started coming down because of
Speaker 1: the leverage UM and that's the collateral. So they loaned money,
Speaker 1: they had it on their books as an asset. When
Speaker 1: that money got written off, then that collateral was no good,
Speaker 1: so they got margin calls, staded to post more collateral.
Speaker 1: That went down and it triggers a domino effect and
Speaker 1: that's exactly what happened with Harry Luna. As we've been
Speaker 1: covering this each week, right, So then we saw Ary
Speaker 1: Luna go down, and then it was like Celsius is
Speaker 1: going down. And then when you talked about like three arrows,
Speaker 1: capital starts going down and it's it's the Great unwind.
Speaker 1: That's what we're dealing with. And it's all because of leverage. Now, um,
Speaker 1: we're still processing through this, but this is probably uh,
Speaker 1: you know, obviously a lot of this, the Great unwind
Speaker 1: was kicked off, was ignited because the FED is trying
Speaker 1: to do a great unwind. So the Fed, the Federals
Speaker 1: over there States is the greatest, the the producer of
Speaker 1: the leverage. Right, that's where it comes from. They print money.
Speaker 1: They print trillions of dollars and put it into the system,
Speaker 1: which causes the housing market to boom, for example, and
Speaker 1: then they drop interest rates to zero. So you go
Speaker 1: borrow a bunch of money, you use a bunch of leverage.
Speaker 1: That's what creates the booms. They print the money, they
Speaker 1: lower the interest rates. You go use that leverage they've
Speaker 1: provided to you, but then they decide when to suck
Speaker 1: it right back out. They decide when to shut the
Speaker 1: music off. So then they stop putting money into the economy,
Speaker 1: and then they raised the rates on you. And so
Speaker 1: that's what started this great and wine that that started
Speaker 1: was November of last year. The FED said they were
Speaker 1: gonna start raising rates, They're gonna start letting assets roll
Speaker 1: off their books. They weren't gonna pump money out through
Speaker 1: quantity of easian anymore, um. And so since then we've
Speaker 1: seen the cryptocurrency markets really start to unwind. Now the
Speaker 1: cryptocurrency markets seem to lead the rest of the financial markets.
Speaker 1: So I think that bitcoin specifically and crypto overall um
Speaker 1: really is kind of this canary in the coal mine
Speaker 1: where it unwound way faster. So bitcoins started rolling over
Speaker 1: really quick and started selling off much before the traditional
Speaker 1: financial markets did. So the FED kicked it off. But
Speaker 1: then as as the bitcoin and cryptocurrency markets capped started falling,
Speaker 1: then that's when the that's when the Terror Luna got
Speaker 1: into trouble. It worked really well when bick And was
Speaker 1: going up in value, but when Bitcoin went down in value,
Speaker 1: Tary Luna got into trouble. When Terry Luna got into trouble,
Speaker 1: then Celsi's got into trouble, etcetera. So here we are
Speaker 1: dealing with this, and it's been a massive drag on
Speaker 1: the bitcoin and cryptocurrency space because it's basically causing massive liquidations,
Speaker 1: meaning they are being forced to sell huge amounts or
Speaker 1: pretty much all everything. They have. Huge amounts of bitcoin
Speaker 1: and ethereum exce are onto the markets at the right time,
Speaker 1: at the exact same time. So supply and demand. If
Speaker 1: you have more bitcoin being sold or more crypto being
Speaker 1: sold than there are buyers for it, the price will
Speaker 1: come down. And so right now with the markets, all
Speaker 1: the markets crashing, the entire you know, from real estate
Speaker 1: to stock markets, do you name it down. Crypto of
Speaker 1: course is way down. But then you have to dump
Speaker 1: all of this on the market. There's not people to buy.
Speaker 1: It's what happens to the price. Of course, it comes
Speaker 1: down pretty easy to understand. So I think it's been
Speaker 1: like I said, the carrying the coal mine, I think
Speaker 1: it happened first, and I would think we would be
Speaker 1: maybe at about the bottom about now. But man, the
Speaker 1: hits just keep on coming. So let's talk about some
Speaker 1: of those hits that keep on coming. So um, like
Speaker 1: I said, uh, Terry Luna has done. That's over UM Celsius.
Speaker 1: What's going on with Celsius? So UM. As I've said before,
Speaker 1: maybe there's a chance you get some of your money
Speaker 1: back from Celsius if you're really lucky. UM. They are
Speaker 1: working with UM, you know, bankruptcy attorneys right now to
Speaker 1: try to wind this down. UM, there's a potential that
Speaker 1: you might get some money back. I wouldn't hold your
Speaker 1: breath over it. But we saw this week f t
Speaker 1: X Exchange that has basically come into kind of be
Speaker 1: like the FED. They're like back stopping all these crypto institutions. UM.
Speaker 1: They looked at Celsius and they made some shocking claims
Speaker 1: that you may not like. I want to tell you
Speaker 1: what that is. UM, But they also stepped into back
Speaker 1: stop another really big, actually two really big other crypto
Speaker 1: companies that are getting hit. And you won't believe the
Speaker 1: deal they made for this. I mean it is insane.
Speaker 1: I guess this is what you get into bear market.
Speaker 1: Maybe you can follow f t x's lead. I'll tell
Speaker 1: you what that is what they said about Celsius. I'm
Speaker 1: gonna tell you about the other deals they've just made. UM,
Speaker 1: And I got a whole lot more coming up. You're
Speaker 1: listening to the Mark mo Show, talking of course about
Speaker 1: the decentralized revolution, talking about bitcoin, cryptocurrencies and breaking down
Speaker 1: the play by place so you can take advantage of it.
Speaker 1: We'll be back with all that and more in a minute.
Speaker 1: Don't go away, all right, Welcome back. You are listening
Speaker 1: to the Mark Moa Show. We're talking about the decentralized revolution,
Speaker 1: the world that's changing before our very eyes, being led
Speaker 1: by the catalyst of bitcoin and cryptocurrencies. We're talking about
Speaker 1: the great unwind, the great unwind, which is uh, the
Speaker 1: leverage in the system melting down. I went through that.
Speaker 1: I'm not going to go back through that again, but
Speaker 1: I was saying that f t X, which is led
Speaker 1: by Sam Bankman Freed, he's kind of stepped up to
Speaker 1: become like the Federal Reserve back stop, the Federal reserves,
Speaker 1: the backstop for the banks. So um previous to the
Speaker 1: feder Reserve in the late eighteen hundreds of United States,
Speaker 1: we had an era known as free banking, and you
Speaker 1: have all these different banks popping up, and each bank
Speaker 1: would have their own currency, and they're going they're going
Speaker 1: bust all the time, and so the Federal Reserve was
Speaker 1: created to say, hey, we'll backstop these banks, so if
Speaker 1: they go bust, all the people that have their money
Speaker 1: there don't lose at all. Um, we'll come in and
Speaker 1: we'll back stop them. Now that's a whole different story.
Speaker 1: I'm not gonna get super deep into that, but f
Speaker 1: TX is doing something similar where now they're coming and
Speaker 1: they're back stopping a lot of these companies going down.
Speaker 1: So celsius Um, they were potentially going to do a
Speaker 1: deal with celsius to backstop it that maybe at least
Speaker 1: help some of the investors get their money back or
Speaker 1: something like that. And we saw this week that f
Speaker 1: t X passed on a deal to purchase celsius due
Speaker 1: to a deficient balance sheet. What does that mean? Deficient
Speaker 1: balance sheet? Well, they didn't like. They didn't like what
Speaker 1: they saw when they pulled back the covers. It says
Speaker 1: uh FTX passed on to purchase leaguered crypto lenders celsius Um,
Speaker 1: but walked away on account of a two billion dollar
Speaker 1: hole in the lender's balance sheet. A two billion dollar hole.
Speaker 1: Where did that two billion dollars go? Well, a lot
Speaker 1: of it was just wiped out in market gap Um,
Speaker 1: there's rumors that potentially the founder of Celsius, Alex Maschinski,
Speaker 1: might have been siphoning money away. UM. I don't know
Speaker 1: if I want to feed into these allegations because I
Speaker 1: don't really have any proof on it right now. But
Speaker 1: we do know that FTX is backstopping a lot of companies.
Speaker 1: I'm gonna go through a couple of them right now. UM,
Speaker 1: but it doesn't look like they're gonna do with Celsius.
Speaker 1: They walked away because of a two billion dollar hole.
Speaker 1: So again, if you have money there, there's a chance
Speaker 1: you might get some back. Now. I think the way
Speaker 1: that I've been understanding this is there's two ways you
Speaker 1: could hold money on Celsius. One you could have it
Speaker 1: with a loan, you could have it earning yield, or
Speaker 1: they could just be doing custody. If you're only having
Speaker 1: money as cut study, then I think you might have
Speaker 1: a better than average chance of Well, you get the
Speaker 1: money first, if there's any money to go to anybody,
Speaker 1: I think you'll get the money there first. And then
Speaker 1: if you have money in the yield products and them
Speaker 1: lend products, then I think you're an unsecured creditor and
Speaker 1: you'll probably last to get any money if there's any
Speaker 1: money left. Now, there's not gonna be enough money to
Speaker 1: go around for everybody, So the chance of getting money
Speaker 1: into those um is probably gonna be slim if if
Speaker 1: not more than a few pennies on the dollar UM.
Speaker 1: So we'll see, we'll see, but we know that Unfortunately
Speaker 1: f t X walked away because of a two billion
Speaker 1: dollar hole. But that's not the same for everybody. Now.
Speaker 1: F t X actually has been talking to multiple companies,
Speaker 1: one of which is another company called Block five, and
Speaker 1: so Block five is maybe one of the other really
Speaker 1: big companies in the United States that was offering the
Speaker 1: same sort of products as a Celsius Both. You could
Speaker 1: give them their bit, your bitcoin or cryptocurrencies, and they'd
Speaker 1: give you a yield on it and give you interest
Speaker 1: four eight percent something like that. Now, a lot of
Speaker 1: people who used to ask me about these and I
Speaker 1: would always tell them the same thing. Look, as a
Speaker 1: real investor, we want something known as asymmetric opportunities. Asymmetric
Speaker 1: means symmetric would means the same on both means the
Speaker 1: same upside and the same downside. I want asymmetric opportunities.
Speaker 1: I want something that has way more upside than it
Speaker 1: has downside. So with bitcoin today, I'm not gonna go
Speaker 1: through the math, but I believe bitcoin has an eight
Speaker 1: x e d x upside. It can go up eighty
Speaker 1: times pretty easily, in my opinion, but it could go
Speaker 1: down to zero, so it has a one x downside,
Speaker 1: could go to zero one x down with an a
Speaker 1: d x up see how it's asymmetric. I like that.
Speaker 1: But unfortunately, when you're using platforms like Celsius or block
Speaker 1: fire or whatever, it was the opposite because now I
Speaker 1: had a hundred percent risks. As we're finding out Celsius,
Speaker 1: you may not get your money back. I had a
Speaker 1: hundred percent risk to make four or eight percent or
Speaker 1: eight whatever it is. So I'm risking a hundred to
Speaker 1: make eight. So I don't like those odds. I want
Speaker 1: it the other way. I want to risk eight to
Speaker 1: make a hundred, not risk a hundred to make eight.
Speaker 1: And that's exactly why I haven't been a big fan
Speaker 1: of those products. And here we are. Block five is
Speaker 1: in the same boat again, caught up in the great unwind,
Speaker 1: too much leverage, tied together. But um, after weeks and
Speaker 1: weeks and weeks of deliberation. It looks like there's a
Speaker 1: deal that actually is going to happen for Block five.
Speaker 1: So good news if you have money trapped on Block five.
Speaker 1: It looks like the deal that f t X worked
Speaker 1: out with Block five is going to buy them out
Speaker 1: at a n discount to their last money raise. So
Speaker 1: UM companies like Block five, they raise money, pull up
Speaker 1: the exact amount so UM. You know these companies, they
Speaker 1: raise is money and as they go up in value,
Speaker 1: they continue to raise money but at a higher valuation,
Speaker 1: which is exactly what happened. So ft X has agreed
Speaker 1: to provide two hundred and fifty million dollar emergency credit
Speaker 1: line to Block five UM, but at a very very
Speaker 1: reduced valuation. So it says ft X is expected to
Speaker 1: pay roughly twenty five million one source set, which is
Speaker 1: below Block five's last private valuation, which was valued at
Speaker 1: four point eight billion. So block fire recently raised money,
Speaker 1: they raised it at a four point eight billion dollar valuation,
Speaker 1: and today f t X is going to buy it
Speaker 1: for twenty five million, which is off of UM what
Speaker 1: their last round was at UM. So that's a big discount.
Speaker 1: Now why would they do that? Well, it appears that
Speaker 1: what happened is block Fi agreed to maybe sacrifice themselves
Speaker 1: and all the investors so that the people that the
Speaker 1: customers of block fire, the people have money on block fight,
Speaker 1: could maybe get some of that money back. Other deals
Speaker 1: that they had potentially UM looked at. According to sources,
Speaker 1: UM were trying to keep the equity of the investors
Speaker 1: in place, but sacrifice customer deposits. But the rumors say
Speaker 1: that FTX that no, no, no, no, We're going to
Speaker 1: help the customers who have deposits. But all the investors
Speaker 1: they invested into a bad company and they're out. Now.
Speaker 1: Look a lot of people in the bitcoin space are
Speaker 1: happy about this, and we told you so. You never
Speaker 1: should have done that. I would never take joy in
Speaker 1: watching somebody else have pain. I'm not going to take
Speaker 1: any joy in that. UM. You know, these investors love
Speaker 1: and thought they were making good investments, but in a
Speaker 1: situation like this, when the markets crashed, I mean, everything
Speaker 1: goes down, they made bad choices. I'm guessing most of
Speaker 1: them were pretty uh. I know some of the top
Speaker 1: guys were very experienced investors. I'm sure they didn't allocate
Speaker 1: more than they could afford to lose. I'm sure most
Speaker 1: of them are going to be tanked. Um so maybe
Speaker 1: having the investors lose the money and having the money
Speaker 1: accrued to the customers is the best source of let
Speaker 1: me know what you think. Of course, get at me
Speaker 1: on social media. Just at one Mark Moss, it's the
Speaker 1: number one Mark Moss. Hit me up and let me
Speaker 1: know what you think about that. But this is just
Speaker 1: a drop in the bucket. There's even bigger ones happening.
Speaker 1: As a matter of fact, the next one I'm gonna
Speaker 1: talk about isn't even bigger liquidation, which is then going
Speaker 1: into potentially the biggest one in the entire bitcoin cryptocurrency
Speaker 1: market space, and it could be bad for the short
Speaker 1: term price. I'm gonna talk about that and more in
Speaker 1: a minute. You're listening to the Mark mo Show talking
Speaker 1: about bitcoin cryptocurrency, is talking about the decentralized revolution, talking
Speaker 1: about the great unwind, what's happening, how you can observe
Speaker 1: it navigated if you're caught up in it and know
Speaker 1: what to expect. Next. I'm gonna cover all that and
Speaker 1: more when I get back in a minute. Uh So,
Speaker 1: don't go away, all right, Welcome back. You are listening
Speaker 1: to the markma Show. And we're talking about the decentralized revolution.
Speaker 1: We are talking about the way the world is changing
Speaker 1: right before our very eyes, of course, being led through
Speaker 1: bitcoin and cryptocurrencies, through technology, looking at politics, finance and
Speaker 1: technology to understand what the heck is going on? What's
Speaker 1: up with these prices of gasoline and food? Why are
Speaker 1: the markets dropping? And right now we're talking about what
Speaker 1: is going on with the cryptocurrency and bitcoin space. And
Speaker 1: I'm calling it something I've been calling it the Great liquidation,
Speaker 1: the Great unwind. And so I was talking about how
Speaker 1: this leverage, all the leverage have built up in the
Speaker 1: system that allowed to grow really fast is now unwinding
Speaker 1: and that leverage is now caused it to crash equally
Speaker 1: as fast. So we're talking about how f t X
Speaker 1: is kind of like the FED acting as similar to
Speaker 1: a FED, where they are UM the lender of last resort,
Speaker 1: their backstopping UM. Some of these companies that are going down,
Speaker 1: they looked at Celsius, they said heck no. He said,
Speaker 1: heck no, there's a two billion dollar hole. We don't
Speaker 1: want to dump our money into a two billion dollar hole.
Speaker 1: I don't blame him. I wouldn't want to lose two
Speaker 1: billion dollars if I had it UM. I don't want
Speaker 1: to lose two dollars, much less two billion UM. So
Speaker 1: they said no to that UM, but they did say
Speaker 1: yes to UH to block five, so it looks like
Speaker 1: they are helping out block five. So good news, good news,
Speaker 1: bad news depend on where you have your money, if
Speaker 1: you have any money at all, UM and what's next.
Speaker 1: So now there's another one crypto exchange, coin Flex. Coin
Speaker 1: Flex has um paused withdraws, so now they won't let
Speaker 1: you get your money off of their Mark Lamb, the
Speaker 1: CEO of coin flex, said that withdraws will probably not
Speaker 1: restart as they had originally hoped. UM to fix the
Speaker 1: forty seven million dollar hole much better than two billion
Speaker 1: on celsius forty seven million dollar hole on coin Flexes
Speaker 1: balance sheet. The company is issuing a token called Recovery
Speaker 1: Value us D and enticing investors with a interest rate.
Speaker 1: Mm hmm. Now that sounds just like the problem that
Speaker 1: caused all of this in the first place. So it
Speaker 1: started with terror Luna and Terra. Luna was a stable
Speaker 1: coin that offered you a rate, And what are what
Speaker 1: is coin flex proposing? They're proposing to create something called
Speaker 1: recovery value U s D an entice, which is a
Speaker 1: stable coin that they're going to create out of thin air,
Speaker 1: and they're going to pay you interest rate on that. One.
Speaker 1: I'm not sure. Well, a couple of things. One, I'm
Speaker 1: not sure how the heck they're allowed to do that.
Speaker 1: You would think the SEC would step in and go,
Speaker 1: wait a minute, this is insane. You can't do the
Speaker 1: exact same thing that caused the whole problem in the
Speaker 1: first place. That's one. Two. I can't believe that they
Speaker 1: would even try. I mean, who the heck is this
Speaker 1: Mark Lamb CEO. What does he think he's doing. Wouldn't
Speaker 1: you think he would have learned and he wouldn't even try.
Speaker 1: And Third, I can't believe people would fall for it.
Speaker 1: And you know I said in the previous segment, I don't.
Speaker 1: I don't. I don't get any joy. As a matter
Speaker 1: of fact, I feel really bad for people that are
Speaker 1: getting wiped out here. I have no joy in seeing
Speaker 1: people get taken down. But part of me, I tweeted
Speaker 1: out last night, Um well, I'll pull up the tweet,
Speaker 1: I said, A part of me, part of me feels
Speaker 1: that they're getting what they deserve, And I know that's
Speaker 1: that's the wrong thing, not not getting what they deserve,
Speaker 1: maybe maybe getting with the deserve. I tweeted out last night.
Speaker 1: I said, um, the age of responsible, the age of
Speaker 1: personal responsibility is snapping back hard, the age of personal responsibility.
Speaker 1: Now to have freedom, we have to have responsibility. But
Speaker 1: the problem is today is nobody wants to take responsibility
Speaker 1: for themselves. And so I feel really bad for people
Speaker 1: caught up in these situations, but they need to be
Speaker 1: responsive for themselves. If you're gonna put money into something,
Speaker 1: you should sure as heck learn what that is. You
Speaker 1: should sure as heck be paying attention to what's going on.
Speaker 1: And if you don't, if you don't understand, if you
Speaker 1: if you don't understand what is, then you shouldn't put
Speaker 1: money in there. If you do put money in there
Speaker 1: and you're not paying attention, that's on you. And and
Speaker 1: and I don't I know that may sound a little harsh,
Speaker 1: but to the point of this tweet, the age of
Speaker 1: personal responsibility is snapping back hard. And this is happening
Speaker 1: in the financial system, and so we're seeing people getting
Speaker 1: wiped out. They didn't take personal responsibility. They see the
Speaker 1: warning signs that are out there. And so if this guy,
Speaker 1: the CEO Mark Lamb, wants to create a new stable
Speaker 1: coin and pay people interest the same thing that caused
Speaker 1: the other crash, and people are willing to go along
Speaker 1: with it, then maybe they deserve to deal with whatever
Speaker 1: happens from that. I hope they don't lose, but sure
Speaker 1: as heck, canna take a lot of risks I wouldn't
Speaker 1: want to deal with. Now they're saying that coin flex
Speaker 1: is saying that a big hole is caused by um
Speaker 1: Roger Ver, who was typically previously known. Maybe he still
Speaker 1: has this Bitcoin Jesus. He was very early in the
Speaker 1: bitcoin space. He was Bitcoin Jesus because he tried to
Speaker 1: evangelize everybody about bitcoin. At one point, I believe he
Speaker 1: had over four hundred thousand bitcoin, over four hundred thousand bitcoin,
Speaker 1: which would make him, at one point, you know, one
Speaker 1: of the richest people alive. I think, let's see four
Speaker 1: hundred thousand times even at twenty thousand dollars, that it's
Speaker 1: a right right around now my calcultors even go that high.
Speaker 1: I can't even tell you how much it is a lot.
Speaker 1: He had a lot, but now you know he bet
Speaker 1: on bitcoin cash. He tried to crash bitcoin and go
Speaker 1: to bitcoin cash, he lost money, and now supposedly there's
Speaker 1: a forty seven million dollar death that he owes. He
Speaker 1: says he doesn't. They say he does, airing dirty laundry.
Speaker 1: I'm not going to dig into that. I don't really care.
Speaker 1: But the point is is of this is that um
Speaker 1: it says here that coin flex has this hole, and
Speaker 1: it says to fix this forty seven million dollar hole
Speaker 1: and coin flexes balance sheet which is supposedly caused because
Speaker 1: of Roger VERR not paying his bill. And again I'm
Speaker 1: not digging into that, but it doesn't matter. There's a
Speaker 1: whole million dollars and in order to fix that, the
Speaker 1: company is going to issue this token of Recovery Value
Speaker 1: s DS stable coin, and it's going to entice investors
Speaker 1: to give them money with interest rate for holding the
Speaker 1: virtual currency. The CEO of Mark Lamb says that the
Speaker 1: ability to pay that interest would come from recouping the
Speaker 1: funds from Roger Ver plus a financing charge that has
Speaker 1: been imposed on him. Lamb says, quote, we don't know
Speaker 1: what's going to happen after if he doesn't repay, or
Speaker 1: if he does repay. Our focus right now is on
Speaker 1: getting these funds raised. End quote. So supposedly Roger Vert
Speaker 1: owes money million supposedly. I don't know the details. I'm not.
Speaker 1: I don't know if he does, it doesn't. But suppose
Speaker 1: he does, that's a whole. So they're gonna sell you
Speaker 1: a stable coin, um to try to raise money to
Speaker 1: fill that hole in a company that's basically insolvent, bankrupt.
Speaker 1: They're gonna try to raise million dollars from people by
Speaker 1: paying interest, and they're gonna supposedly be able to pay
Speaker 1: them that interest by charging the financing charge to Roger Vert,
Speaker 1: who already won't pay the money in the first place. So, uh,
Speaker 1: pro tip here. Never loan money to somebody that you
Speaker 1: don't know and don't know if they can pay you back.
Speaker 1: So I don't know Roger Vert. I don't know the
Speaker 1: situation here, and he's obviously not paying and so why
Speaker 1: would he pay later? Um, Why would I loan money
Speaker 1: to them in hopes of maybe making I would have
Speaker 1: to be a complete idiot to do that, and it's
Speaker 1: almost criminal. I don't know, man, you know, I feel
Speaker 1: I hate throwing that around. But the CEO says, quote,
Speaker 1: we don't know what's going to happen after if he
Speaker 1: doesn't repay, or if he does repay. We don't know
Speaker 1: if he's going to repeat repay. How can he in
Speaker 1: any good consciousness and even legally, how can he go
Speaker 1: to get forty seven million dollars from people like you
Speaker 1: and I in the hopes of maybe getting money back
Speaker 1: from somebody that he may or may not be owed from.
Speaker 1: And he says in his own words, we don't know
Speaker 1: if he's going to repay. How can you do that
Speaker 1: in good consciousness? How can you do that legally? I mean,
Speaker 1: it's just insane. And so that's why I say, if
Speaker 1: anybody gives them money for this, I don't want anyone
Speaker 1: to lose money, which is what I'm trying to warn you.
Speaker 1: But I have to just feel like it's on them. Man. Uh.
Speaker 1: Back to my tweet from last night, when I was
Speaker 1: reading this stuff, and I was and I was looking
Speaker 1: at this, you know, the age of personal responsibility is
Speaker 1: snapping back hard. By the way, if you're not following
Speaker 1: me on Twitter, what the heck are you even doing? That?
Speaker 1: One got about thirty impressions. I put out a couple
Speaker 1: of good things here and there. Follow me on Twitter
Speaker 1: at one Mark Moss. That's just the number one Mark
Speaker 1: moss Um. Let's see, I got more talk about liquidations.
Speaker 1: There's two more big ones and as a matter of fact,
Speaker 1: it's the biggest one, the biggest one that my guest
Speaker 1: actually last week, Mike Alfred said that wasn't going to
Speaker 1: happen because they were so big, and yet here we are.
Speaker 1: I'm gonna break that down and more in a minute.
Speaker 1: You're listening to the Mark mo Show talking about the
Speaker 1: decentralized revolution, talking about bitcoin and cryptocurrency, is talking about
Speaker 1: the way the world is changing before our very eyes.
Speaker 1: I got a lot more to cover in a minute.
Speaker 1: Don't go away, all right, Welcome back. You're listening to
Speaker 1: the Mark mass Show taking you through, step by step,
Speaker 1: walking you through the decentralized revolution, the way the world
Speaker 1: is changing before our very eyes. If you zoom out,
Speaker 1: you can see it, and if you zoom all the
Speaker 1: way in and look at the incremental steps, you can
Speaker 1: see it as well. Of course, we're talking about the
Speaker 1: way the world is changing with bitcoin and cryptocurrencies, and
Speaker 1: we're looking at through the lens of politics, finance, and technology.
Speaker 1: The way, it's changing all of those things before our
Speaker 1: very eyes. We've been talking about the great unwind, the
Speaker 1: grid unwind. Of course, the Federal Reserve. They create every
Speaker 1: boom and bust that we have. Um, it's insane that
Speaker 1: we allow a group of people to control our money
Speaker 1: and create booms and bus on us. It's absolutely insane
Speaker 1: that that we allow this to happens. In saying that
Speaker 1: it happens in the first place, it's even more in
Speaker 1: saying that we're allowed to make it happen. Of course,
Speaker 1: Henry Ford, the father of the automobile, told us over
Speaker 1: a hundred years ago. He said, quote, if the American
Speaker 1: people knew how the financial system worked, there would be
Speaker 1: a revolution before the morning. That means before the morning,
Speaker 1: like right away instantly. So of course there's probably no surprise.
Speaker 1: That's why we don't learn about the financial system in schools.
Speaker 1: We don't hear about it, we don't talk about it.
Speaker 1: But the Federal Reserved, it's responsible for every boom and
Speaker 1: bust that we have. They put money in things go
Speaker 1: really good. We're buying houses, were buying cars, we're expanding
Speaker 1: our business. And then they sucked the money back out
Speaker 1: and then everything crashes. So they started this, you know,
Speaker 1: November last year, they started to say they're gonna start
Speaker 1: raising rates. We're gonna start letting go from quantitative easy
Speaker 1: and increase them I supie a quantity of tightening, tightening
Speaker 1: the mon terry supply. So of course things started crashing.
Speaker 1: Bitcoin starts going down, and it's just this great unwined
Speaker 1: because all the leverage um so Terra Luna celsius um
Speaker 1: we went, we went through all these big going their
Speaker 1: mating every week now coin flex. But now it's getting big.
Speaker 1: Now it's getting serious. So now I've been talking about
Speaker 1: for a couple of weeks this three Arrows Capital three
Speaker 1: A C and and they're probably going to default. And
Speaker 1: here we are. So this week we see that crypto
Speaker 1: hedge fund just defaulted on a six hundred and seventy
Speaker 1: million dollar loan UM So the Three Arrows Capital defaulted
Speaker 1: on that. Digital asset broker Voyage did. Voyager Digital issued
Speaker 1: a notice on Monday morning stating that the fund failed
Speaker 1: to repay a loan of three million in US dollar
Speaker 1: Peg stable coin another fifteen thousand, two y bitcoin. We're
Speaker 1: three three million at today's prices. So what happens is
Speaker 1: Three Arrows Capital default that on that six seventy million
Speaker 1: dollars to Voyager. But I bet that Voyager needed that money.
Speaker 1: And so now Voyager doesn't have the money they need
Speaker 1: to pay their bills, but more importantly to meet their
Speaker 1: margin requirements, which means now they default on a bill
Speaker 1: to somebody else. You see how that works. That's why
Speaker 1: this is the great unwined. It's just a domino one
Speaker 1: after another, starting with the small ones and working its
Speaker 1: way up. We can see Digital asset brokerage Voyager Digital
Speaker 1: issue to notice on Monday morning saying the fund failed
Speaker 1: to repay them. Three A C's solvency crunch comes after
Speaker 1: weeks of turmoil. I've been talking about it for weeks here,
Speaker 1: which is they raise hundreds of billions of dollars in
Speaker 1: value um. Voyagers said it intends to pursue recovery from
Speaker 1: three A C. In the interim. Good luck. My parents
Speaker 1: told me when I as a kid, you can't squeeze
Speaker 1: blood out of a turn up, right that old saying.
Speaker 1: And so yeah, sure go get your money from them
Speaker 1: if if you could. But the problem is is they can't. Now.
Speaker 1: As a Friday, Voyager said it had approximately hundred thirty
Speaker 1: seven million in US dollars and owned crypto assets. The
Speaker 1: company also noted that has access to a two dred
Speaker 1: million cash and USDC revolver credit line, as well as
Speaker 1: fifteen thousand bitcoin worth three million revolver from Alameda Ventures. Now,
Speaker 1: who's Alameda Ventures? Who? Who the heck is? These are
Speaker 1: these people that are loaning money everyone? Well, Alameda Ventures
Speaker 1: is owned by f t X founder Stam Bankman Freed.
Speaker 1: It's his quantitative trading firm. So Sam Bankman Freed has
Speaker 1: Alameda and he has f t X, and he's the one,
Speaker 1: as we've been talking about, that's backstopping all these institutions
Speaker 1: and so um they've given Voyager credit lines. Now, the
Speaker 1: one thing I have no exposure to Voyager or blocked
Speaker 1: VI that that that f t X and and uh
Speaker 1: Alam are stepping into. But if I did, one thing
Speaker 1: that would probably give me a little bit of comfort
Speaker 1: is that once they come in and you know, put
Speaker 1: up the two or fifty million or here we have
Speaker 1: three five million UM that they've given the Voyager, they
Speaker 1: probably like they looked at Celsius and said, heck, no,
Speaker 1: two billion dollar hold, We're done with that but they
Speaker 1: will give five million Voyager, So I'm guessing they liked
Speaker 1: what they saw with Voyager. I'm guessing once they put
Speaker 1: five million in, they are probably not going to let
Speaker 1: that go away. So if they need to put more
Speaker 1: money in, they probably will. So it probably gives me
Speaker 1: a little bit of air of confidence there. I don't
Speaker 1: have any money in any Voyager or Block five, but
Speaker 1: if I did and it was locked, maybe I would
Speaker 1: feel a little bit better that they probably won't let
Speaker 1: it go down. Um it says Voyagers already pulled seventy
Speaker 1: five million dollars from that line of credit. But how
Speaker 1: did three A C How did three airs capital get there? Well,
Speaker 1: it had a lot of exposure to Tera Luna obviously, right,
Speaker 1: and then I had exposure to Block five, right, And
Speaker 1: so you see how that UM trickles down. Now now
Speaker 1: for the big one. So UM. I had a guest
Speaker 1: on last week, Mike Alfred. We were talking about this
Speaker 1: UM go to the Go Starch Mark Moss podcast or
Speaker 1: Mark Moss I Heart to find that podcast. It was
Speaker 1: a good conversation with Mike Alfred, an insider that kind
Speaker 1: of knows the inner workings of this stuff. So if
Speaker 1: you want a little bit more insight into this. It was.
Speaker 1: It was a really good conversation. Go check that out.
Speaker 1: But um, we I asked about a company called Genesis,
Speaker 1: and Genesis is the big dog. That's that's the biggest
Speaker 1: dog in the space. Genesis is owned by Barry Silbert,
Speaker 1: which also owns Coin Desk or DCG Digital Currency Group. UM,
Speaker 1: and so they're the big one right there, they're the best.
Speaker 1: And he said, oh no, you know, they're they're so big,
Speaker 1: they're so liquid. Uh, they're credits so tight. Um. You know,
Speaker 1: they're not gonna get caught up in this. But here
Speaker 1: we are. So on coin Desk, the news site, which
Speaker 1: of course is owned by the same people, it says
Speaker 1: that Genesis faces hundreds of millions in losses as Three
Speaker 1: Arrows Capital exposure swamps crypto lenders. UM. It says that
Speaker 1: the trading losses said to have suffered a nine figure,
Speaker 1: nine figure losses partly through exposure to three Aris Capital
Speaker 1: and Babel Finance. We haven't heard about Babel, so nine figures.
Speaker 1: So let's see, seven figures is a million, eight figures
Speaker 1: is uh ten million, and three figures nine I'm sorry,
Speaker 1: nine figures is a hundred million plus. Here it says
Speaker 1: hundreds of millions, as in plural hundreds. Cryptocurrency market maker
Speaker 1: and learning from Genesis Trading is facing potential losses in
Speaker 1: the hundreds of millions, in part to exposure to overleveraged
Speaker 1: hedge fund three OARS Capital in Hong Kong based crypto
Speaker 1: lender Babel Finance in the order of a few hundred
Speaker 1: million dollars says. The precise tally of Genesis losses may
Speaker 1: not be known for some time because the company is
Speaker 1: seeking at least partial repayment from its counterparties, and some
Speaker 1: of the losses may have been offset by hedging. So
Speaker 1: don't we don't really know how deep these holes are
Speaker 1: right now, It says. A cascade of liquidations that many
Speaker 1: different crypto lending and trading platforms has followed the high
Speaker 1: profile unraveling of crypto firms such as Terraformal Labs, Ary Luna,
Speaker 1: um Celsius and three Oars Capital. So this is all
Speaker 1: domino affecting down now. Um. You know, according to Mike Alfred,
Speaker 1: who I had on last week, you know, Genesis is
Speaker 1: so big, so large, they're probably gonna be okay, um,
Speaker 1: it says Genesis originated over forty four point three billion
Speaker 1: dollars in loans in the first quarter of two three.
Speaker 1: That that's what they generated just the first quarter of
Speaker 1: this year billion UM. It's rumored to have a war
Speaker 1: chest of about one billion um oh d c g um.
Speaker 1: Their parent group is about to have a war chest
Speaker 1: of a billion that can help Genesis buffer any kind
Speaker 1: of shock. UM. So you know, I don't know if
Speaker 1: it's gonna go down, and that doesn't affect me. What
Speaker 1: it does affect me, and it affects you, is that
Speaker 1: as this continues to go down, these massive forced liquidations,
Speaker 1: when these companies are forced to liquidate fifteen thousand bitcoin
Speaker 1: at one time, the market there's not enough buyers to
Speaker 1: absorb fifteen thousand bitcoin at one time, and so that
Speaker 1: pushes the price down. And so UM, while I think
Speaker 1: we've seen the worst of bitcoin selling, we really don't
Speaker 1: know because we don't know how big these holes are.
Speaker 1: And this is a danger to everybody in the space. Um,
Speaker 1: And we're just gonna have to see how this plays out.
Speaker 1: Of course, I'm gonna keep you up to date on
Speaker 1: it as it goes, uh, step by step by step,
Speaker 1: So hopefully you can see the contagion that's happening. We're
Speaker 1: going to continue to monitor the situation, keep you up
Speaker 1: to date on it. We're gonna keep our eye on
Speaker 1: the Federal Reserve because they're the ones that have caused
Speaker 1: this thing in the first place. When they might pivot
Speaker 1: and ease some of this pressure off of the markets
Speaker 1: and the cryptocurrency markets, you'll be the first to know
Speaker 1: if you listen to the Marketmas Show on a regular basis.
Speaker 1: That's what I got here today. All right, thanks for listening.