Shitcoin Insider #001 - DeFi & Ponzinomics

[00:00:00] Speaker A: What is up, guys? Guy Swan here. Instead of an episode of Bitcoin Audible today, I wanted to share an entirely new idea that I've been cooking up for a while now. I know you've heard about DeFi and ICOs and CryptoKitties and governance tokens, and it's almost impossible to navigate the endless sea of nonsense like a train wreck. You know, it's horrible, but you just can't look away or help but be curious. That is where this show comes in. We are going to get our hands dirty and dig through all the crap and tell you what we find so that you don't have to. Don't forget to subscribe to the show and give feedback on Twitter. Let me know what you think. Should we continue the podcast? Should we do more episodes? What else do you want to hear about? But for now, sit back, relax, and enjoy the show. [00:00:53] Speaker B: Foreign. [00:00:57] Speaker A: Bitcoin maximalists trying to make sense of the sea of shitcoins. This is ShitCoin Insider. We are just running with this right now. This is the first episode of ShitCoin Insider, and welcome to the show. Introduce yourself as. I guess you could say as much as you want to. [00:01:30] Speaker B: Well, I think a lot of people. Well, I don't know about a lot. Some people will know who I am, others won't. It's fine. I guess I'll leave it a little bit mysterious for now. Just to keep it. [00:01:42] Speaker A: Keep it on the DL. We'll keep it on the DL. We just have a guest who knows some stuff about some shit. [00:01:46] Speaker B: You have to. You have to know to know. But, yeah, so I. You know, we've been talking about this for a while, and I have no idea how we're gonna make this interesting, but definitely there's interesting. [00:02:02] Speaker A: That's. I think that's what I want to talk about most, is just defi. And. Well, mostly just because that's the thing right now, you know, like, if this was 2017 adult be about ICOs. Right. And there is still a lot of that going on, surprisingly. [00:02:19] Speaker B: But it's the same with a new wrapper. [00:02:22] Speaker A: Yeah, literally, it really is. And on that note, what's your best explanation of what most of these defy things are before. Before getting into it? I'll say that I have tried to pick, like, tried to get people on Twitter to actually kind of break it down, like, give me some sort of a solid answer as to what it is. And essentially what I pulled out of a pretty lengthy conversation was that you put like, eth or Bitcoin into a, like, holding account, and then you get some tokens, and then you can offer up these tokens, you lock these up into some yielding thing, and then you get a different token as a reward. And that. That seemed to be the setup. And that supposedly somewhere in there was, like, a 50% or 100% profit. What is. Is that even close to right for some of these things? I know it's an ocean. What do you. [00:03:30] Speaker B: What can you explain what it is? The easy answer is Ponzi. Nomics. That's the easy answer. I call it Ponzinomics. Maybe there's a better word I could use. But. So when I say Ponzi, I don't mean in the traditional sense necessarily, but I almost do. It's. [00:03:48] Speaker A: It's a new twist. It's a clever new type of Ponzi. Right? [00:03:52] Speaker B: Yeah. And I mean, I hesitate to say Ponzi because I, you know, you. Well, the distinction I always make, like, if somebody calls Bitcoin a Ponzi, for example, like, you tell them, like, well, you know, so Bitconnect was a Ponzi because it was a lie. There was no magical machine generating interest to pay everybody's, like, forever gains. It was just. So you're buying this thing based on a lie, getting this thing, you know, that has promises behind it that are simply, like, objectively not true. And the only way that you're going to make money is if other people buy it. And then, you know, so in that sense, it's not a Ponzi because the machine does what it says it does. It just. If you understood it better, you understand it was a stupid machine. So. So you're getting what you pay for. You're absolutely getting what you pay for. It's just. But it still has the same economic implications as a Ponzi where, you know, if people stop buying it, then you'll stop making money. And there's really not any reason why they should keep buying it, except that they think they're going to make more money. So. And we can get into the. A little bit more of the guts with that, if you want. Essentially, like the. So. So Defi has been around for a while, like a couple of years at least. I thought it was kind of more. [00:05:16] Speaker A: Of a late 2019 thing. [00:05:17] Speaker B: Right. [00:05:18] Speaker A: Or is it just that moment it was like getting. [00:05:19] Speaker B: Well, no. So that's when they introduced the newest Ponzinomic concepts that really were a catalyst of the new cycle that we're seeing now, and which is already starting to oversaturate a lot. So it started off with the lending platforms and the lending platforms, the lending pools, the, are actually a cool idea and actually probably will continue to be used, you know, forever. And not necessarily on Ethereum because the three won't be around probably very long. But the concept of being able to loan your loan money to your or lend money to yourself, like take out a mortgage with no bank is pretty cool. Gotta admit, as long as it works. So the way that it works usually is. There's lots of twists on this, but the, the core way that it works is lenders loan money to a pool and it's like a big, you know, all together in a big pool and a smart contract that by design anyway. And whenever we talk about the design of these things, you know, the actual truth may be different. Like maybe some guy's got a master key somewhere and he can drain the thing. Who knows? You know, they've always got like these little caveats or whatever. But, but just so we're talking about the way it's designed in a perfect world, which is, you know, for its worth. So people put money into a big pool. This big pool regulates itself usually using variations of the Bancorp algorithm, which is like an automated market maker algorithm. And then other people who want to borrow money or yourself can withdraw from the pool. And based on the difference between supply and demand, people adding to the pool and people taking from the pool, the pool will issue interest rates and the borrowers will pay some amount more than the lenders make into the pool. And that's how the lenders are getting interest and the borrowers are getting to borrow and the borrowers are all collateralized too. [00:07:26] Speaker A: So the loan, the borrower has to be collateralized. And see this is, this is what gets me about this is that like there's huge counterparty risk if somebody can withdraw. So are they withdrawing? Like, like if somebody puts up bitcoin into this pool, is somebody else withdrawing that bitcoin? [00:07:46] Speaker B: So it's. Well, first of all, it's like not real bitcoin because it's fake. [00:07:49] Speaker A: Sure, sure. But that, that's. [00:07:50] Speaker B: But yeah, but, but. So yeah, so let's say you've got bitcoin and you want a car, but you don't want to buy a car's worth of spend a car's worth of bitcoin because you think bitcoin is going to double this year. [00:08:03] Speaker A: Yeah. [00:08:04] Speaker B: All right, so your car cost 30 grand. The pool is going to want you to have like 70 or 80 grand to borrow 30 grand. So you take, let's just say 80 grand worth of bitcoin, you put it into a pool to collateralize your account, and now you have like lending power or borrowing power, just like with leverage, kind of. And so you want USDC so you can go dump on Coinbase and get your car. So you see that the rate for USDC is, let's say, 12%. All right, cool. And that changes. And there are ways you can get like, fixed rates, whatever, but we don't need to get too much into the actual details. So you're, you're getting into this loan, you're gonna pay 12%, whatever it is, and you're gonna get out 30,000 USDC. Now, the guy that gives you the 30. There's no one guy that gives you 30,000 USDC. It's a pool. The pool gives you 30,000 USDC. And it knows you're good for it because you've got 80 grand worth of bitcoin in the bitcoin pool. Mm. So. And you're gonna have to pay, you know, on a schedule, just like you would with any other loan. Otherwise you risk losing your collateral. You essentially get liquidated. And in this way, you know, you can go to Coinbase now, you dump your 30 grand, you get your car, and you can pay back 30 grand in USD worth of payments if bitcoin triples, doubles, whatever. Doesn't matter. Like you still just owe that 30 grand in USDC or plus your 12% or whatever. The rate is usually like calculated per block. So in that sense, this little machine actually worked, you know, if the underlying network was good. This little concept actually is like, you know, this, you couldn't necessarily, you couldn't call this a Ponzi because there's a guy that wants to borrow money and guys that want to lend money and there's, you know, and so. And so, yeah, so, you know, it's market based and that would work and that's fine. And that's been going on for years. But that never exploded. Because why would it? I mean, like, sure, because you have. [00:10:13] Speaker A: To have a whole lot of collateral and because, you know, like, everybody has to stake, like there's, there's cost and trade offs to all of that. [00:10:21] Speaker B: So. Yeah, but what made it really explode recently and started this whole cascade of, you know, basically money looking for quick gains was when one of the most popular lending platforms called Compound Finance, decided to add a token to the mix. [00:10:43] Speaker A: So for now, it always starts there, doesn't it? That's always where it starts. [00:10:50] Speaker B: And so Compound said, hey, now, you know, we get this popular platform, and it's making all you guys all this money, but we want some money, so let's make a token out of thin air to. For the thing that's already working. And essentially, when the. When, you know, compound was very popular, it had hundreds of millions of dollars in it, you know, being lent and loaned or lent and borrowed, whatever. And so, like, a lot of people were bullish on it and wanted to hold a piece of it, so to speak. And especially, like, you know, a lot of these finance guys, they don't actually know what they're buying. They just know it seems like some big financial tool that might be big in the future, and they want to invest in it, whatever. For various reasons, the token was popular and people wanted to buy it. Just like with this new uni token, like, oh, this is gonna be huge. I want to be a holder of this, so I'm gonna buy it. And so comp token starts to moon, of course. And the thing about that happening, though, is the way that comp token is mined, so to speak, distributed for the initial people is whoever loans and lends loans and borrows on compound gets rewarded in compound token proportionate to their size. So what happened was because the token was getting so much interest in becoming so valuable, and the rate that you make for borrowing and lending is fixed in compound token, you had this weird dynamic where it actually became profitable to borrow because you'd get your airdrop on top of your. So let's say the rate was, you know, you're borrowing at a rate of, let's say, 12%, but you're getting tokens that equal 30% of your loan. [00:12:45] Speaker A: So this is what that guy was trying to explain to me because he said. He said in. At some point, or I think it was somebody who jumped in the conversation, was saying that they borrowed money and were making a profit. They were making like a. A, like set percentage on the money that they borrowed. And that is because. That is because. So what donates to the borrower gets some compound token too. [00:13:17] Speaker B: Yeah, the borrower and the. And the lender. So because they're you, it's basically whoever uses the platform. But what ends up happening, of course, it's a market. So if you pay me to borrow, I'm just gonna keep borrowing. I'm gonna take all the money I can get and use those collateral to borrow more. And then I'm gonna take the money I just borrowed and I'm gonna borrow my own loan. [00:13:37] Speaker A: Like I could borrow like you do and they do. [00:13:40] Speaker B: So people would take, you know, what they borrowed and put it back into the pool on the other end so that they get more collateral to borrow more and get more comp tokens and make more interest. And of course this whole sandcastle is built on the idea that people are going to forever FOMO into comp token which is obviously not going to happen when they're. And this is already by the way, stopped. This was, this just sparked it. [00:14:06] Speaker A: Okay, okay, so comp has already run its course here. [00:14:09] Speaker B: Basically we can look basically quick. [00:14:11] Speaker A: But yeah, I'd be very curious because I want to know how long these things are kind of like, oh, they. [00:14:18] Speaker B: So it happens. So the, the more this goes on, like people don't. This is the biggest thing that people do not understand that I wish especially like there's so much I want to talk about with regards to like how people think about this, especially in the Ethereum community. They are so I don't mean to be insulting, but very naive. [00:14:35] Speaker A: Like they say something that's kind, that's a kind way to put it. [00:14:40] Speaker B: So I mean, so the high on compound I think was over, you know, close to $300 compound right now is $134. So it's already, you know, it's not on its honeymoon phase anymore and it's definitely not profitable to borrow anymore. The market sorted that out fairly quickly. But, but when it's, when it's happening, when it's new, you know, it's very easy to get caught up into. Especially when you're making money. It's very easy to get caught up and think, wow, this is so great. This is gonna last forever. Because why wouldn't it? Because we're making money. And when you make money that's good. So it's great. [00:15:22] Speaker A: Obviously the next guy's gonna come in, it's gonna be even, even better. Because everybody wants to make money. [00:15:27] Speaker B: Yeah. And the thing that maybe doesn't occur to them or maybe, I don't know, like when you can make an unlimited number of these tokens and they are. People are. It doesn't matter how much money comes in, it will get used by one of these. You know, they can make unlimited free tokens as long as you want to keep throwing money at them. They can make unlimited tokens out of thin air and suck that money up. And it's no way that everybody gets more money. Like nobody makes more money unless somebody makes less money. That's always been true. Like there's no actual money being made. You know, if you just made, you know, if you just made 10 times your investment investing in something that didn't make sense to you, it wasn't free money. Like somebody lost money or is going to lose money. [00:16:11] Speaker A: Some money had to buy in and at the end of the day somebody's got to get back 10% of what they put in. Like it just has to happen. [00:16:21] Speaker B: Yeah, there's no free money actually being made. That's the like a disconnect. Maybe there happening, big disconnect. But. So this ponzinomic loop is very circular because borrower borrows because he's getting comp token and he's going to make a profit to borrow. Lending rates go up, more lenders come because they want the higher lending rates. More borrowers of course are coming because they want the free computer. And this just drives, you know, in a big circle, more borrowers, more lenders. Then there's like, you know, more comp. Being airdropped requires more comp to be bought on the market to keep everybody getting paid. And as soon as that cycle kind of stops, like obviously the rates are going to go right back down. Like those people don't want those loans. This is not, and this is the other big mistake. I want to, I want to probably like to scatter here, but I wish I was more organized in my thoughts and explanations. But another one of the big, I guess, misconceptions is people think that when is this like peak, like Ponzi cycle mode being driven by some, you know, unsustainable, obviously everybody should realize it's an unsustainable incentive when that's kind of like happening in the peak of it and you got hundreds of millions of dollars trying to mine these tokens so they can dump them on the next guy that thinks he wants to be a holder of comp, you know, for 30 years, whatever. While that's happening in the, in the ponzinomic phase, people think that that represents its real utility. Like this is the actual demand for this future platform. Like this platform is the future. Can't you see it's doing a billion dollars volume? Like this is so great. What do you got that's doing a billion dollars volume? Like this is going to be for like three weeks. Like this is not the platform. This is like people getting robbed for a while. Like this is, you know what I mean? This is. [00:18:11] Speaker A: The lightning network has lesser. [00:18:14] Speaker B: If you're, if you're holding comp token because you think you're going to Keep seeing, you know, a billion dollars in volume on this thing, like whatever it was at a peak, like in perpetuity, like, you're an idiot. Because that's just there while they mine the rest of that comp supply, while the rates justify them, you know, being able to mine at a profit. And once that's done, like, that's the only reason that money was there. Like, sure, there's interest to loan to themselves and whatever, but it's not even close to the interest in the Ponzi. So there's like the interest in the Ponzi, there's the money that's there for the Ponzi, and there's the money that's there because they actually needed a loan. And the money that's there because they actually need a loan is not even like 1%. [00:18:56] Speaker A: I was about to say like 1%, 2%. It's like this tiny, tiny little fraction. It was. It was the percent and it was the meaningful amount that was there before the hype explosion and the. Everybody wanted. Everybody want a token. Come play. So does compound just print indefinitely? Like, is it. Is it just. If more people add liquidity, more. More compound is created. Or is there some sort of a cap or some sort of a measure? [00:19:24] Speaker B: Usually, and I don't. So not specifically with compound, but usually because this isn't just compound now, other platforms are falling, and that's why this defi thing is continuing beyond compound. Because, you know, you had all this new money sloshing around in the pool. You had to give them more Ponzi to move to, like each once each Ponzi is like getting towards its end. They need a new Ponzi to move their money. They need something new to get more yield on new assets that haven't been fully mined yet. And it continues for a while, but usually it's like a cap that's based on your size. So like for example, with the new Uni token, which is the Uniswap token, if you join one of the Uniswap liquidity pools, particular ones that just airdrop this token, there's like 83,333, I think, sorry if I'm wrong, per pool that are distributed per your percentage of the pool every day. [00:20:16] Speaker A: So the more people add, the less percentage you are to the distribution of the shitcoin. [00:20:23] Speaker B: Yeah, it's just like kind of normal mining with hash rate, except for. With this. It's just like, how much money do you have? There's like over $300 million per pool. As I check. I think so you got to be decent size to try to get any. But. And the whole. I don't want to get into the details of every single little token, but the uni token, I don't see that being worth getting. [00:20:45] Speaker A: What is. So what is. Is this a copy pasta of compound? Like. Like, is there anything different or meaningfully unique? No, I mean, I know it's a different token, but. [00:20:56] Speaker B: Well, but I mean, it's a different. So there's different ways of making legitimate yield. So the first way we talked about was the lending and borrowing, collateralized lending. So the other way of making. The other place where yield can legitimately come from is the decentralized exchanges. So, okay, if. [00:21:19] Speaker A: So even as the one that the guy. This is the one that I. The conversation on Twitter that I referenced was talking about is that there was. They were. They said they were making a hundred and something percent return. And they. They tried to. They said there were three tokens in the conversation. Three different tokens in the conversation that I was just having, but that they said that this was because they were offering up liquidity and making. Supposedly making fees on exchanges. So like, like they were the other end of a bunch of trades, like swaps between these tokens, if I'm not mistaken, like between the shit coins themselves. And every time, like, they paid like a 1% or whatever fee that was going to the people who were offering up liquidity. But I did the math on all the numbers they gave. It's like, oh, it did this much in volume and all this stuff. And I was like, all right, well, let's just back in the napkin math on this. And I can't remember exactly what the comparison was, but it was like a billion dollars or something stupid was locked up and they were making like, you know, 50% or something return on it. And then he was bragging about how many trades there were and how much liquidity there was on this thing, but it was like 80 million or something like that. And I was like, wait, so you're making like massive percentages on this huge liquidity pool and the volume of actual trades is not even like a tenth of the liquidity, which that in and of itself, like the amount of trades you just said just don't even cover the quote unquote fees that are supposedly being made off of this thing. And I said, let's say everybody's just paying a 1%, a full 1% fee. And it's like a hundred. It's like in the hundreds of thousands of Dollars. But there's like tens of millions and hundreds of millions, like, going. Coming out of this thing. How does. What. Where's the, where's the thing in the loop here that's just printing tokens? Which, which part of uni is doing this? [00:23:43] Speaker B: So, I mean, who knows about this particular guy, whether or not he was, you know, exaggerating his. His gains or not. But there is, there is. There are yields to be made. It's not risk free. And of course you're. Whatever you're making, you're, you know, it's coming from either. Either because you know something other people don't know, or because you're taking a risk that people don't want to take. Because all the rates that every pool makes are transparent. And at any time, you know, if you're making, you know, 100% a day, which, which can happen. It sounds crazy, but if you're making about. [00:24:18] Speaker A: Is basically saying, like, you can make 100%, like, whatever, if you're making 100%. [00:24:22] Speaker B: A day, every other whale can see that you made 100% a day. And if they want to, they can add that. What that means is that your size of that pool is large and the pool is small relative to the amount of volume being traded on that pool. But what will happen in a free market is that other people will see that, hey, this pool is small, and I could be, you know, I could become 10 times the size of this pool and I'll suck in that entire thing for myself. Why not? Now if they don't, it's either because this is way too scammy and I don't want to be holding one end of this, which is probably gonna get rug pulled, because it's the other thing. Like, if it's so that the scammier the asset, the more yield you can probably make, because the less the whales are gonna want to. You know, if there's some. If you make some new shitcoin token on some new shitcoin platform that everybody kind of feels is a shitcoin, even the Ethereum people, but it's generating a lot of volume and buzz. Like, do you really want to be that whale that says, okay, I'm gonna provide $200,000 with liquidity on this shit coin because it's getting buzz and I'm gonna have to buy $100,000 of this shitcoin? Like, if the founder rug pulls, you're sitting there with $100,000 worth of this token. Even if you made 40,000 in fees, like, you're gonna lose it instantly still. [00:25:36] Speaker A: You're still just total loss, like. [00:25:38] Speaker B: Yeah, so. So like a whale is just gonna buy 100 grand or 200 grand of some brand new scammy thing just to provide liquidity and suck up all the fees. So the guy who will is hoping that. Or either he's hoping or he knows something. Like maybe he knows the team that made this thing and he knows like, oh, they're not gonna rug pull. I happen to know this because I trust these guys and this is actually more legit than people think. And in that case, you're kind of arbitraging people's, you know, you're arbitraging what you know. So you're saying, I know this isn't as risky as people think and I'm gonna provide liquidity here. But usually what's happening is people are just taking insane risks. [00:26:14] Speaker A: No one's paying 100% in fees here, right? Like the people who are putting money into the liquidity pool are getting quote unquote, this huge percentage as a new token, like in no unit you actually could make. [00:26:29] Speaker B: So for example, a poll that I. [00:26:31] Speaker A: Got, okay. [00:26:35] Speaker B: I can pull up the stats here, but I put not a huge amount in that because I don't want to, you know, risk. I'm not a risk. I'll be big risk here. It might seem like I'm a big risk taker from this conversation, but I'm, I'm, I'm well aware of what I'm getting into here. So I'm not, you know, say like, oh my God, I need to put all my bitcoin into this. Like, no, I put like, there's like 1% less than 1% of, of, you know, I'm not willing to lose a lot here, but I can. [00:27:03] Speaker A: I don't fault you for playing. I'm. I mean, makes me curious, Mouse. I'm, I personally stay away from it, but it interests me. Like I feel like seeing it for what it is makes it even more interesting. [00:27:17] Speaker B: So there was a pool recently. It's pool still up, but it's doing less volume today. But you never know, it could do more volume tomorrow if it gets hyped or whatever. And the pool is small. It's 100 grand in the pool total. So liquidity providers new is one of them make up $100,000 now with just 100,000. [00:27:36] Speaker A: What did you put ethereum into this. [00:27:37] Speaker B: Or you put, you have to put both sides of whatever the pair is. Okay, so if the pair is like shitcoin a versa theorem, then you have to put half shitcoin A and half ethereum. Okay? And, and so, but if there's only a hundred grand, either $50,000 of Ethereum in the pool and $50,000 worth of the shit coin in the pool, and then people that have a theory and want shit coin or have shitcoin and one ethereum they'll trade into this pool. Now what happens is with just a hundred thousand dollars, it's really easy to be a significant percentage the pool. You know, if you had 10 grand there, you're 10% of the pool. That's a good chunk of the pool. Now it's like being a 10% of, you know, all the mining or whatever on whatever this thing is worth. So when this thing like was new and like having a very good volume day, I think it did like 19 million in volume. The fee is only 0.3%, but 19 million in volume and you've got 10% of that volume is huge. Now of course, as this continued like, more whales started to come and the pool started getting bigger. Because they're not just gonna let like, you know, a couple guys with a hundred grand take $19 million worth of volume for themselves. Other people started joining it because, you know, the bigger the volume, the more enticing it is for others to come and say, I want some of that, those fees. This is a small pool generating outsized interest. But so let me just do some quick math. If you got 19 million in volume and you're taking a 0.3% fee, that's $57,000 in fees. Now if you could manage to be 10% of that, you just made six grand. Now it's very hard to keep 10% of that because as I said, other people will see it and they'll come and add, and so your, your, your proportion will diminish. But either way, you're gonna make a few grand that day anyway. It's not gonna last every day, but for that day you'll make a few grand on your 10 grand, which is huge. Or you could even, you know, and if nobody else does, if it's super risky and like everybody thinks it's gonna crash, maybe no other whales touch it. You get that whole pool and you just made 57,000 on 10,000, you know, that's best case. It's very hard to find that kind of situation in reality. But if that's happening, it's because nobody wants to touch it with a ten foot pole. [00:30:03] Speaker A: But where does your liquidity go when Somebody else is doing exchanges. [00:30:09] Speaker B: So it uses again the band core algorithm. So it's. [00:30:14] Speaker A: This is all based off of that same. That same thing. Are these like, just like modifications and. [00:30:19] Speaker B: New every idea, every though they don't actually use Bancorp. Vancore was one of the first big ICOs, if you remember. [00:30:25] Speaker A: Yeah, I do. [00:30:27] Speaker B: So that's another reason why you should never buy tokens. Just because you think something's cool. Over $100 million in the Bancorp ICO, everything uses Bancorp algorithm now. [00:30:36] Speaker A: Nobody's using, nobody cares about the token. [00:30:38] Speaker B: Nobody's paying Bancor anything for this. [00:30:40] Speaker A: I say this over and over and over again. It's like, this is open source code and the token is so freaking irrelevant. Like it. It's attached to nothing and there's no reason for it to be. If it's useful, somebody's just going to copy and paste it and put their token or just take the token out and do it. Like, if it's actually useful, then you don't need a token. You just do it. Like, but just crazy. [00:31:05] Speaker B: So Bancorp was like anybody who looked at the Bancorp algo and thought about the implications and thought, wow, this could change everything. You were right. But then if you bought the token, you're an idiot because. Because the two are not the same. And that's the thing that. I don't know, it's like there's a big disc. Like, everybody thinks they're buying, like a share in the idea and you're not. You're buying whatever shitty tokenomics there are behind that thing. And nobody, like, in a free market, nobody's gonna pay you for. No, like, nobody's gonna just decide to pay you so for no reason. And, you know, like this, like, Chain Link. Nobody's going to decide they want to pay Chain Link massive fees and buy all these chainlink tokens for Oracles. If somebody else makes an Oracle system with the same whatever concepts and chain links that are worth stealing, if somebody steals them without the token, you will never think about Chain Link again. Because why would you. It's not a charity. You're not just saying, I think we should give to Chain? Like, no. By the way, those founders are dumping millions of dollars a week. If the token. Yes. If the token was so valuable, the founders wouldn't be dumping it constantly. Wow. [00:32:12] Speaker A: Not surprising. The chain link went up so hot. That was short shit. Portnoy was in it as soon as Portnoy. When it was in it, it was like, okay. [00:32:26] Speaker B: They'Ve been dumping for months. About 500,000 tokens every week or so, which is about $5 million every week or so and more when it's higher. Like they know what's up. This is their 10 minutes of 15 minutes of fame. And it's either get your money out while there's volume or you can tell stories about how you could have been rich for the rest of your life. Like they know what they're doing and they are getting their money out while it's hot, you know, and so anybody that's thinking about buying that stuff, look at what the people who made it, if they thought this thing was so valuable, they know better than you do, they thought it was so valuable, they would be dumping it as fast as they possibly can, like without like creating too much fudge. They are dumping as fast as they possibly can, as they can get away. [00:33:08] Speaker A: With without crashing the price. Yeah, I'm sure. [00:33:16] Speaker B: And you bet with this uni token and stuff too, they probably told all their friends, their friends probably opened up 10 different MetaMask wallets and became eligible for this thing so they could get all that extra bonus. There's so much corruption here. That's what happens when you have centralized governance. [00:33:32] Speaker A: Don't they even do KYC for this stuff? [00:33:34] Speaker B: No, I mean, which is cool, they don't, but okay, no, it's all, it's all. I mean some things do, but not. [00:33:39] Speaker A: I was just thinking like added cost on top of like the nightmare potentialities of this. But I guess that's actually a good thing that if you want to make returns on a whole bunch of shit coins, you at least don't have to kyc. [00:33:53] Speaker B: Yeah, it is by design. We say by design because there's caveats and there's lots of asterisks here. But by design it's centralized and not supposed to be able to be rug pulled or whatever by the founders. Everything's got its own, you know, whatever's. And some of it, some of it's more decentralized than others. Some of it I simply, you know, I can't verify myself whether people have master keys to this stuff or not. Who knows? I just assume that everything does, that's safe. But, but so yeah, so to the yield stuff with the uniswap like you can, if you chase a risky pool, you can make outsized gains, but the risk you're taking is that, you know, the shit corn part, the shit coin part of your pair will drop more than, you know, whatever you made in interest. So If I make 100% that day I got 10 grand in it, 5 grand Ethereum, 5 grand some other thing. And my 5 grand of that other thing, you know, rug pools, and now it's worth like 200 bucks. Well, you know, what happens in, what happens in the pool is that, you know, as people are, oh, you asked the question, where does it go? So somebody wants to trade. Oh, so they come to the pool and they say, I've got one Ethereum. I want whatever. One of the things worth of that thing is the pool gives them, takes your, takes your ethereum and it gives them, minus the fee, how much of the shitcoin they're supposed to get. And in this way, like everybody in the pool will have a little bit less or a little bit more ethereum and a little bit less of the coin. And. And it works out because the Bancorp algorithm that after lots of trades, it remains about half and half according to what each pair is worth to the other. So it should remain like however much an ethereum is worth to however much of the shit coin is, should remain on par. But what will happen though is if, like, if the token does dump and people are all dumping token and taking ethereum, the pool will become like, you know, the thing was basically worthless then. The pool is like very little ethereum, very much of this worthless token. So you don't even get to keep your $5,000 worth or 50 or $5,000 worth of Ethereum. You'll just have like all like 90% of this token that nobody wanted and they dumped on you. [00:36:01] Speaker A: Oh, wow. Because the, because it got out of balance and that was how it was. That's how it equalizes. [00:36:08] Speaker B: Yeah. So people are dumping ethereum into this pool, are dumping token of this pool, taking ethereum, dunking token, taking Ethereum. As that happens, the price of the token relative to the price of Ethereum is changing. And so you get way more of the one that's less valuable than the other. [00:36:26] Speaker A: So you can really be, get like really left holding the bag. [00:36:31] Speaker B: You'll have no ethereum left, but you'll have a bunch of this coin that everybody didn't want that everybody was dumping. [00:36:38] Speaker A: Oh, God, that's the worst because that's. Oh, wow, that's really bad. [00:36:43] Speaker B: That's. Yeah, that's why a whale, that's why, that's why you can get like these pools where like a whale's not going to come and steal your fees because they don't want to hold that token. You know, in order to, you know. [00:36:55] Speaker A: You kind of the magic, the hype sauce is to have, like, a token that's in its hype. So, like, like, the idea is, like, which token? So it's a hot potato that you're. You're desperately. You have to lock this up for a certain amount of time, and you're just hoping that whatever it, Whatever hot. [00:37:17] Speaker B: Potatoes, whatever you make in fees, you're hoping you make more than 24 hours. [00:37:22] Speaker A: Like, lasts for another 24 hours and. Holy crap. [00:37:26] Speaker B: Yeah. So, I mean, obviously, like, I don't know, hopefully this doesn't sound appealing to anybody. If you don't know what the hell you're doing and just try to put in one of these pools, you're gonna lose money. Like, there's so many people that do know what they're doing and are just taking money from people. Like, if you don't know what you're doing, you're the one they're taking money from. So don't do that. And even those guys end up getting wrecked because, like, I saw it yesterday. One of my buddies is. And by the way, this is over saturating very quickly. This is not just something that I've observed, but many people have observed that. [00:37:59] Speaker A: All the guys that, yeah, we probably already passed the peak if, like, oh, yeah, it feels. It feels like we're on the way out. But who knows? [00:38:07] Speaker B: All the guys who don't, like, listen to this, like, oh, you're getting this. And try to gamble and make some. Like, no, you're getting on. You're the guy paying for everybody else that was there before you. [00:38:16] Speaker A: You're paying for the other ones to finally get out because they're like, yeah. [00:38:21] Speaker B: So please do not buy this shit. But anyway, so like, the guys who started out in the beginning being dumb enough to, like, FOMO in on the sushi and the hot dog and the. What's with all the food? [00:38:37] Speaker A: What the fuck are these tokens for? [00:38:40] Speaker B: Oh, they're so bad. [00:38:41] Speaker A: Is it literally just like a new token for a new thing? [00:38:46] Speaker B: Yeah, first of all, they're all clones of each other. Like, everything gets cloned a million times, which is part of the oversaturation. And actually, allow me to refine one of my arguments for bitcoin. Recently, I'm all over the place. It's. I empathize with anybody who's actually trying to listen to this. I'm all over the place, but. [00:39:07] Speaker A: I'm following. This is great. I love this shit. [00:39:10] Speaker B: So you got like, you know, the union, and it'll be a clone of union. It hasn't Been the biggest clone of uni yet, but there probably will be soon. And you got all these, you know, clones of clones and, oh, this one. So you got literally tokens coming out now, which is like this token. You buy it and you can stake it and it generates. So there's one that came out. So I don't even want to promote these guys. Just say I don't, because, you know, these are hype, stupid things that are going to collapse and the guys that are making it know they're just in it for some quick bucks. But there's like token A and it's like, yeah, buy token A and it will, and if you stake it, you'll generate token B. Both of these, like, completely made up out of nothing and you get all this token B. And when you get token B, it'll generate a little bit more token A so that you can like. And you're like, yeah, let's do this. I'm going to be so rich. Because everybody's going to want token A so they can make more token B so they can make token A. And it's like, no, it's like, literally we're just getting to the pure, like, raw form of the Ponzi here. They're not even backed by anything anymore. Like, it was backed by like actual trading yield and actual somebody was actually. [00:40:13] Speaker A: Lending something and maybe there was percent made it somewhere. [00:40:17] Speaker B: Like there was an actual. Like there was a little bit of legitimacy behind it. But as they become more. As it oversaturates more and they become more desperate for yield, you're just seeing like the pure Ponzi part of the incentives. [00:40:30] Speaker A: We've gone without tokenception, just without even. [00:40:34] Speaker B: Nonsense, without even pretending like there's utility there anymore. Like, the utility now is like, well, people want yield, so they buy this. There's going to be yield, like, and it's new and so there hasn't been seen. But, but. And I was explaining to somebody the day, and I really liked the way that I explained it to them and I. I probably won't be able to repeat it here exactly. But essentially, as we see all this oversaturation occurring over and over and over again, that is why these things don't last. Because anybody can continue to make free tokens and take that same money. That same money is going to keep chasing the easiest yield. And, like, it just gets into shittier and shittier and shittier little copies of copies of copies and the re. And because somebody. And what sparked this discussion was somebody said, well, how is this any more Ponzi than Bitcoin. How is this like, name one thing about this that, that, that bitcoin doesn't also do. [00:41:27] Speaker A: And so I explained inability a lot. [00:41:29] Speaker B: Of the explain a lot of what I've explained to you now and I, you know all this fake yield for yield sake stuff. And I said bitcoin is like the anti oversaturation. Like you cannot over saturate Bitcoin. You can and it's still going to get like the clones of the clones of the clones, but nobody cares about that shit. Like bitcoin actually is like the one that is useful and that matters and that's not going in like you, if you're buying bitcoin, you cannot be oversaturated by the scams. [00:42:02] Speaker A: It's the settlement assurances. The token yields are the opposite of settlement assurances. And if you're talking about the con, the, we're talking about monetary competition, it's dog shit out the gate. Like no matter what your supposed yield is, like, it just doesn't. Oh God, it's just, it's so painful that you can't. That they just think because, oh, this is code and this is also code, that they're the same thing. It's like, no, no, they're not. They're not even remotely related to each other. [00:42:33] Speaker B: Yeah, like they don't. So and this is the thing that's really definitely getting to me when I see, you know, because I for, I've been immersed in kind of like all the blockchain stuff for a while just because of, you know, that's what I do for a living. As you know, I've got a company that does random stuff, whatever. But one thing that really gets me is when I see these, let's say Ethereum influencers, the ones that are supposed to be like the thought leaders of the, of the herd kind of trolling bitcoiners and saying like, oh, you guys are dinosaurs. You guys are just, you know, there's no innovation there and you guys are just hanging on to, you know, it's boomer coin and like there's so much going on, you just don't understand, bro. [00:43:13] Speaker A: I hope they keep thinking about how. [00:43:14] Speaker B: Much is going on. [00:43:16] Speaker A: Like the thing is longer. [00:43:19] Speaker B: They, there's a big discrepancy in knowledge. They're right. But it isn't that bitcoiners don't understand Ethereum. It's that they don't understand the value proposition for bitcoin at all. Because if they did, they would stop thinking that they were even competing with it, with this nonsense. Like, just because, you know, you see some. Some volume on a Ponzi to does not make it competitive with the volume that's in bitcoin at all. There's no. If you understand the value prop of bitcoin, there is no. They are not providing any of that value at all. [00:43:54] Speaker A: And so, in fact, they brag about the fact that they're doing the opposite. Like the assurances and the level of security that you get in bitcoin. It is literally bragged about that. Like, oh, look, we're printing this many. It's like bragging about inflation in a competition of who can be the hardest money. Like, right. Just. It's ridiculous. [00:44:21] Speaker B: Yeah, like a government thing. [00:44:22] Speaker A: One of like ten different levels. [00:44:24] Speaker B: Your puny economy. I just printed two trillion yesterday anyway. [00:44:31] Speaker A: But you think about it though, is that it would get a bunch of, you know, there would be a subset of people who would rush in and be like, oh, they just printed 2 trillion and they put it into this subsidy, this subsidy and this thing and this thing and they go rushing for the subsidy and the thing where that new 2 trillion went for. And that would last until the currency ate shit, like, until it just imploded. [00:44:52] Speaker B: And we're seeing the various little scandals. But, you know, a bitcoiner does not have to understand all the little Ethereum stuff to understand all you need to know, if you can see, like one. So there's core fundamental principles that bitcoin, Bitcoiners recognize about bitcoin, like the maximum supply. I like the fact that the rules can't be arbitrarily changed. Like all these things that are, you know, some people scoff at. But these principles are the reason why it's so valuable. [00:45:30] Speaker A: They're the root innovation. Like, they're the thing that you can't get anywhere else. [00:45:35] Speaker B: You don't have to understand. You don't have to understand, like all of Ethereum. All you have to understand is if you see some of these fundamental principles that are being violated or don't exist, you don't have to think about the rest of it. You just say, no, I'm not interested. Like, if you saw someone, it's not. [00:45:50] Speaker A: So easy to just dismiss the whole thing. But I'm still deeply curious about what, what goes on over there and, like, what they talk about and shit. [00:45:58] Speaker B: Yeah. So as they're sitting there, as they're sitting there trying to say that the bitcoiners are in dinosaur land. Whatever bitcoiners get why Ethereum Bitcoin is. [00:46:11] Speaker A: Just staying out of value. Don't swim in the swamp. That's gross. [00:46:15] Speaker B: But the Ethereum guys do not understand while they're sitting here thinking that they are, I don't know, somehow doing something special, they do not even understand why, like, they're not even in the. They're not even playing the same game. [00:46:32] Speaker A: Yeah. For many of us in our own journeys, and particularly after finding bitcoin, it becomes very clear how much school either never taught us or how many of those things were just wrong. That is where Tom Wood's Liberty Classroom comes in. There are so many great teachers in this set of courses and monthly live sessions even, and forums to learn with others in the community. The number of courses here is just crazy. And they are still adding more. You can learn the truth of US and Western history, about the history of political and economic thought over thousands of years. Take a class on logic that teaches you how to think rather than what to think. And my personal favorite, a class that goes through the entirety of the traditional economics textbook, teaches it and then explains where it is misleading or outright wrong and exactly why Liberty Classroom is the best place to learn the economics and history that public school never taught you or that fed you nonsense about. Go to guyswan.com liberty and you will also help support this show. I've been a consumer of Liberty Classroom for a long time and I know you guys will love it too. So Guy Swan and that swan with two ends. Guy swan.com/liberty with that. Is that. Is that the common mentality in your. In your take? Like, is that maddening? Like, for. For like an example for me, like, particularly in defi. Like, I'd be curious because I actually knew people who were invested in bitconnect who knew exactly what it was. [00:48:22] Speaker B: It's different. It's very different. I am, I am. This is why, like, I, like, so, you know, some of my bitcoin friends would, you know, and probably rightfully so would, oh, you're shitcoining. Okay. And I get it. And I would be very judged if any of my friends participate in the share. I'll be very judging if they do what I'm doing. I'll be like, you're idiot, stupid ass. [00:48:46] Speaker A: But this is me. This is my thing. [00:48:49] Speaker B: But the reason I think is allowed to do that, like, because I don't know, it's like people get like when they're making money, it's like a feed. It's like it sparked something in their brain that says, I did A good thing. This is good. Like, I need to do this more. Like, this is. Like, this is a. This is. You know, bitcoin sat there and made 3%, but I just made 2,000% on. Like, this is so much better. Like, no, your brain is stupid. Like, well, it's like. [00:49:17] Speaker A: It's like you're in kindergarten or whatever. Like, the teacher can give you a test and ask questions and, you know, you don't have to know the first thing about whether or not it's, like, actually true, the answer to all these questions. But if you give the answer that the teacher wants and she gives you a gold star, you're going to be very, very proud of yourself, going to be very happy, and you're going to be like, this is the way things are because I checked these boxes and I got a fucking gold star. [00:49:43] Speaker B: Yeah, so. So where was my train of thought there? [00:49:51] Speaker A: Talking about the mentality of the people in it. [00:49:53] Speaker B: Like, oh, yeah, so it's disgusting. It's really just like, I don't even. Like, I want to slap so many people every day. Like, because you're talking to, like, a random person about what? Like, everybody. Like, the. The like, people. It is a little concerning, too. Not concerning, like a way that it's like, actually matters or spat for bitcoin. But since I just. Majority of the community has completely dismissed bitcoin and, like, they've bought the. They've bought the story that they've heard from their shit corner friends. They're like, oh, yeah, that's a nothing coin. Like, nobody gives a fuck about that. Like, this is where it's at. Like, we're doing. This is the thing. This is the thing that anybody that knows anything should be doing. And those people are just like, idiots hanging on to boomer coin. Like, and that is. And even, like, even some really smart people, like, we're the even. Like, you know, it doesn't fury me, like, to see some really, like, smart and, like, clever coders that are otherwise would be, you know, great people that you'd want to be around. And they don't even think about or care about bitcoin because, like, they entered this world of, like, yeah, everybody knows. Like, this is the smart. This is what the smart people are doing. Like, and they just hear that and they're just like, they never even take. [00:51:07] Speaker A: It for granted, their side of the coin. Like, they never even started from monetary principles or even thought about the monetary implications. They just went straight in and was like, oh, so bitcoin is the model T And this is the fancy new shit. All right, I'll hang out. [00:51:22] Speaker B: If you join. You know, if you join a dorm and. And everybody in your dorm, like, you know, you're new, and everybody like, yeah, so that dorm down, like that one down there, like, that's. Nobody wants to be in that dorm. Like, that's the crackhead dorm. You're just like, okay, anybody in that dorm is a crackhead. Like, so, like, you know, like, that's what everybody told you when you came. And so that's what you think. And so it's really disgusting. And I hate that so many people. [00:51:47] Speaker A: Are Twitter, so obviously it must be true. [00:51:50] Speaker B: Yeah. And that kind of does reinforce it, to be honest. Like, and that's something that maybe some of you guys. I love the toxicity when it's because, like, even there's guys that are super toxic against me, and I do not hate them because of thinking like, this is bitcoin's immune system. Like, they are doing a good thing. You know, anything that's like that, especially if it's like a. Like a threatened to like, change bitcoin anyway. Like, I am all about just, like going crazy over that because that's why it works. Like, that's the white blood cells. But so I don't. You know, I love that you want to call me Shit Corner and like, talk about how shit I am. That's great. I appreciate your work, your work. But, but, but. But there is, you know, probably a degree where it's maybe a little too extreme. Like one of these guys I'm talking about that would otherwise be a good guy, smart coder, clever guy, wants to get into, like, something that he sees as, like, this new cool tech. And maybe he's looking at the ethereum community, and maybe he's looks at the bitcoin community, and maybe because he built like, a tool for you to swap or something, like, the first thing he hears from any bitcoin guy is, oh, fuck you, shitcoiner. You're like, go play with your retard stuff. And he's like, you know, maybe, you know, that was pretty cool, like what he made. Maybe, you know, it's like, there's tools that do. There are tools that do useful things, and then there's how much stupid money is being thrown at them, you know, okay. And so you don't want it. You don't want to put. You don't want to be part of the stupid money. But there actually are some cool toys being built that will be used probably. [00:53:23] Speaker A: Bancor minus the bancor token. Maybe there's something interesting there. Maybe there's a place for decentralized, like, collateralized lending. I mean, maybe it works. Maybe it doesn't have, like a giant bug in it that could wipe everybody out. [00:53:36] Speaker B: So if we, you know, if we could create, and we probably will, I think people are already working on it. If we had like, bancorp, algo, lightning network, like collateralized lending, we would love it and we'd brag about it. It'd be great. And so, like. Yeah. And we would be essentially borrowing from or building on top of those same ideas that were built in that shit coin factory. Because some of those ideas are valid, I think, in the future of, like, money tools. And they. And one of this is the term I hear that means that I actually like a lot. They call them money Legos. I like that term because it's like you got all these little pieces that you can use with money and you can put them together to make like, a big money Lego castle that does all these weird things because. But, but anyway, so some of the idea. And that's the thing that maybe some bitcoiners probably don't give enough credit is like, some of the ideas are good. It's just that the. Obviously the economics and the, like, you should not buy these tokens. Like, there's a difference between the idea and. And, oh, I gotta go invest in this. Because it's a good idea. Like, two different things. So and so in that sense, like, yeah, maybe there are. Maybe the toxicity sometimes is a bit much. If you give a fuck about. Sorry, language. If you care about. [00:54:52] Speaker A: That's okay. [00:54:54] Speaker B: You know, attracting. Attracting some of these otherwise just like normal good people that aren't, like, trying to fight for their right to code something. Like, they just want to, like, you know, they see cool stuff to build and they're building. And if you, you know, you can easily close them out. [00:55:10] Speaker A: Yeah. [00:55:11] Speaker B: Unnecessarily, man. [00:55:13] Speaker A: My perspective on that is that, like, I really don't. I don't care that much about the toxicity. Like, I do see it sometimes and I'm like, ugh. Like, you could be. You could be a little bit calmer than that. And like, my personal choice is to be much more. Like, I don't. I like, I like talking to, you know, the litecoin guys and, you know, like, debating with the BSV dude or whatever. Like, I don't, like, I don't. I don't feel like it's a really a threat. Like, so I don't See any reason to, like, be vicious or specifically angry about it. But I'm not gonna, like, I'm not gonna pull my punches either. Like, I'm not gonna tell you something that I don't think or be like, no, yeah, I think the project's great and has a lot of potential. Just maybe you could change some things and be like, no, I think it's like. I think it's a crap project, and I think it's not going anywhere. But you're fine as a person if you want to try it. But. But I also, like, I'm not really gonna fault anybody else to some degree of just kind of being an asshat. People are. I don't know. Sometimes I like an asshat every once in a while. Sometimes you need those people. White blood cells and all that, right? [00:56:23] Speaker B: Yeah. Oh, man. But there was. I don't mind. I'm not gonna call him out on the show. There was one guy in particular that I thought he was very, very, very toxic all the time to everyone, including to me. There's this, you know, big bitcoin room that he used to be a part of that would not even allow me to enter it because of my history with working with blockchain stuff. And it was mostly because of him. Even though, like. And it was a little frustrating sometimes because, like, I use bitcoin every day. I'm, like, doing, like, you know, it's all I do most of the time is bitcoin stuff. And this guy, all he does is, like, trade on finance or whatever, you know, long against shorting bitcoin all the time. That's his using bitcoin, which is, you know, whatever. Like. And he thinks he's like, this grand bitcoin or whatever, but. But this particular guy, super toxic, constantly, like, he flipped 100,000% Ethereum. [00:57:10] Speaker A: But, like, oh, no kidding. [00:57:13] Speaker B: He was like, yeah, fuck you guys. You know, you guys are sitting here waiting on Moon all the time. Like, wind Moon. Wind Moon. Well, Ethereum Moons every day over here. We moon every day. We don't wait. We just moon. And he, like, he got in, like, right at the end of, like, the uni stuff pumping, and he just got wrecked on, like, who's the dumb money that just ran? Who knows how much bitcoin he had? But he was the dumb money and just ran right on the end of that. And just, like, while shouting about Moon, like, obviously. [00:57:42] Speaker A: I bet you feel sorry for him, don't you? [00:57:44] Speaker B: No, I don't. Like, actually, I really hated that. Like, I. I hated That I respected how toxic he was when I realized how fake he was. Yeah, the whole time he was just like that. [00:57:54] Speaker A: There are a couple of times where I feel like I've seen people who were, like, real vicious about it in one direction kind of end up being vicious about it in a different. Like, they end up stepping outside of it. I don't know. A lot of hypocrisy all around, but it's communities toxicity from. Good God. The amount of times that I see shitcoiners just given straight hell to bitcoin and all the Model T stuff. Obviously, I'm in bitcoin circles. I see bitcoin conversations before I see shitcoin conversations. I've done nothing but call them shitcoins this whole show. So fair. Do where it's due. But, like, I still, like, I don't see anybody, like, trying to, like, meet somebody halfway here. Like, it's not like, as if I think, like, I see these shitcoin conversations, like, well, yeah, bitcoin's like, a really great project, and, like, I'm liking it. It's like, no, it's like bitcoin's Model T and it's Boomer Coin, and you guys are retards, like, who have, you know, who just have the bigger Ponzi scheme. It's like, okay, well, what the hell do you think is going to be the response to that? Like, like, everybody's just being an ass. Grow up. Get over it. [00:59:07] Speaker B: You know, and, you know, there are some that I'm appreciative of. The mature bitcoin groups that do exist. I like them where everybody's just building. And that's one of the things I've loved about. [00:59:20] Speaker A: I'm mature. [00:59:22] Speaker B: Some of the things that I loved about Lightning is that, like, you know, we can tinker again. A lot of the tinkering kind of was deteriorating because, like, you know, it's hard to. [00:59:32] Speaker A: Tinkering is fun. [00:59:33] Speaker B: Yeah, it's hard to tinker on a chain when you're paying $12 fees, which ironically, I guess, is happening on Ethereum. And they're still tinkering, but it's because they've got. [00:59:42] Speaker A: The Ponzi fees went crazy high. I was, like, seeing people, like, trying to get the. So that's one thing I don't want to get quite back on this whole thread. But every one of these swaps and getting liquidity and getting it back. These are all Ethereum transactions, right? You see, these are all tokens. [01:00:04] Speaker B: Everything's in a of, you know, I actually had a ex bitcoin cashier. I say X. It's funny. A lot of the. So I was known for being like kind of a BCH troll. I've spent disproportionate amount of time. Like you know, I really respect Greg Maxwell because he actually spends time like in the BSV and BCH communities. [01:00:28] Speaker A: Like reason like for the amount of hate that he gets. He's incredibly patient and actually explains this stuff. Like I have so much respect for him for doing that and he is the most hated person ever over there just because he just tells the truth. [01:00:45] Speaker B: But anyway, so I take a, you know, I know Greg Maxwell but I take a page from his book and I, you know, I've spent a lot of my time donating to educating BCH and BSV guys and they hate me. [01:00:59] Speaker A: And they doing Lord Satoshi's work there, man. [01:01:02] Speaker B: But I'll sit there and like just break it down and why they're wrong or whatever. Just try to give them some 101 on Bitcoin. 101. That's the thing. Like most of them do not even know how mining works. Like if they understood bitcoin they wouldn't be in that shitcoin. So I spent a lot of time explaining the very basics of like. Yeah, so you don't mine on like a laptop necessarily. Like one guy told me like all these people will just start using their like computers for something else. Like no actually, but anyway. Oh wow. [01:01:29] Speaker A: Okay. [01:01:29] Speaker B: Yeah, like they don't understand the mining at all. They don't understand the very basics. But I mean of course they don't. They did. They wouldn't like listen to Craig's nonsense. But anyway, I saw like a lot of the guys, especially the BCH guys, BCH is really dying because of. For reasons lately. [01:01:43] Speaker A: But because there's another fork, you know, live by the fork, die by the fork. Like they're just, it's just infighting on top of infighting because they all think that they should have the say over where the project goes and when there's a disagreement there's no way to get back to consensus. It's just done. [01:02:00] Speaker B: So there was this, there was this new kind of Ponzi Nomic thing coming out and I recognized what it was and I knew that I would have an edge like with how it worked. Like basically that the game was just dump immediately. But I realized that a lot of people didn't realize that. So it's gonna be for all the idiots that don't realize that it's money for you. Am I a scammer for doing this? I didn't make it. I just like, hey, here's a way to make some easy money on idiots. But I went there and lo and behold, in the community I saw some of the bch guys who had like, who had heard in some of my bch circles. Like, nobody knew where they went. Like, where did such and such go? Like, who knows? He just left all the groups. We don't know where he is. And there he was. And like this new Ponzi token thing that I'd found like, and, and, and I messaged like, dude, people are looking for. He's like, yeah, me. And he's like, look, starts listing a big list of like some of the bch. The big guys. Some of the big guys. He's like, we're all here, we're all doing, we're all doing this. It was like, wow. I mean, of course I can't talk. [01:03:02] Speaker A: Too much because they just hopped to the next thing that looks like it's gonna run. [01:03:08] Speaker B: But I mean, yeah, it's a. Had a, a better point I was getting at, but maybe too much coffee this morning. [01:03:19] Speaker A: You can never have too much coffee. That's not true. That's not true. But I try, I try to see if I can get there one day. This is why I value bitcoin maximalism though. Toxicity and all that stuff aside, is that like, it's long. Like there's so much about the long term mindset. Is it like bitcoin? So many of the people I know who are in bitcoin are in bitcoin for the long haul. Like they're here to stay and they're like, we're not going to get distracted by all this crap and go back to the whole you were just talking about with the bancor thing and like, oh, well, what if we built this on top of lightning or whatever and it was actually like a lending platform, a collateralized and you know, decentralized. Is it like that would actually be cool and we would be excited about it. Is that anything that's actually meaningful, even if it's just 1% of the shit that is being done on the token printing, looping circular token return yield Project Ponzi, that if there is any 1% of something useful there, it will just get soaked up into. It's just code, it's just a script, you know, like it will just be soaked up and put on top of lightning. If that's a useful thing to have and we're mostly just going to ignore it because it's just 1%, you know, it's just that tiny little corner of what's going on over there. And when there's a real need for it, okay, it'll be built. But we've got a money to fix. You know, we've got a hundred trillion dollar problem to solve. That is not the important thing to focus on. We'll get there. We'll get there if it's needed and if it's useful. But this is a 50 year problem to solve and we're not going anywhere for 50 years. Like this is. We are stuck, we are here and we are riding this shit to, you know, ride or die. Like that's it. [01:05:18] Speaker B: And even, you know, like the guys that run in, great, great points by the way. But just thinking like about the, like about the guys that run link, I hope that the link guys are dumping their $5 million a day. I hope. All I can do is hope that, yeah, okay, you built some shitcoin stuff and you made some money. I hope that you're smart enough to be putting that money in a bitcoin. Like, don't be like, if you be. [01:05:41] Speaker A: Putting that crap in the fiat, it's just fiat for fiat. [01:05:44] Speaker B: If you're, if you, you know, if you want to slope what I, you know what, I don't even mind. Like if somebody wants to, like if bitcoin is their money, even though they don't think about it, but they use it as money and then they're doing like all this shitcoiny stuff. Like bitcoin is winning anyway because bitcoin is being used for exactly what it's supposed to be. It's like they're taking for granted that bitcoin is there to be their bank account while they go and do whatever scammy things they do in their job. [01:06:12] Speaker A: Which is funny, that's how they still treat it. So many of them still end up using bitcoin because I mean the example is that. And maybe I should ask you about this. The whole bitcoin. A billion dollars in bitcoin is wrapped up on Ethereum. [01:06:27] Speaker B: Like no, we definitely should talk. [01:06:31] Speaker A: Tell me about that. A, what does that mean? B, what's that for? Is that for all these uniswap tokens and stuff, like for trading pairs and unwrap that a little bit. Unwrap that billion dollars in wrapped bitcoin. [01:06:48] Speaker B: So if you will, you know, if you ever want to piss me off on Twitter, all you have to do is say there's more Bitcoin on the, on Ethereum than on Lightning Network. Because it's a really, really, really dumb thing. This. I hate that stupid talking point. The reason why, I mean, when you get into second layers, you got to talk about what is the second layer but lightning. When you're using Lightning Network and using Bitcoin, Lightning Network, it's your bitcoin, your private keys. You're moving. You know, all the bitcoin is like it's in your wallet. Multi sig. Sure. But nobody can spend without your coin, without your keys. [01:07:22] Speaker A: Yeah, you got your keys and the redemption, like it's, it's yours. [01:07:26] Speaker B: And you're exchanging that to other people. You're giving real bitcoin to your peers. It's not an iou, it's not a. Whatever. It doesn't go through some exchange. Now, if you wanted, you could make an argument that finance was a more successful second player than mine. You could make that argument. [01:07:43] Speaker A: I would bitcoin on it. [01:07:44] Speaker B: Yeah, Coinbase, it's got a bunch of bitcoin on it and it, and it lets you move off chain and you can settle on chain. So why don't we consider. Why doesn't anybody ever say, oh, finance is the real bitcoin scaling layer? Nobody says that because we all recognize that, you know, when you have your money on finance, finance is holding your money. They can take it. They could be hacked. You have to trust them. So, like, there's all these things that, you know, we don't consider that bitcoin at all. Like, we like bitcoin because we're in control. We get to be our own bank. We get to hold our keys, we get to use our bitcoin. We're not giving our bitcoin to you so that you can throw it around in a bucket and give it, you know, give us some back later when we ask for it. So like, nobody will argue. Even though you could theoretically argue that it was like the bitcoin scaling layer, you won't really see anybody seriously try to argue that because they know the reasons why. That's a flawed argument. But with these wrapped tokens, it's the same exact thing. Just obfuscate a little bit. What happens is you got some guy who's got some smart contract on Ethereum and they got like a gatekeeper protocol, which essentially means, you give me Bitcoin, I'm a gatekeeper. Maybe there's a found a foundation of keepers or gatekeepers where we have to like multi sig. Or whatever. But we're going to take that bitcoin, we're going to put it in an exchange and we're going to sit there and let it sit in that exchange. And then in return we're going to like all sign with our key. [01:09:10] Speaker A: So they're literally putting it in like an actual exchange. [01:09:15] Speaker B: They're putting in like Kraken or. [01:09:16] Speaker A: Oh holy crap. [01:09:18] Speaker B: Yeah. And it still requires theoretically like multi sig from them, whatever, but not on the exchange level. Like whoever owns that exchange can just take it. [01:09:27] Speaker A: Yeah, the hell that's like, that's multi sig on top of the same centralized problem. Like it's not, it's not in place of it, it's just, it's a. Oh God. It's like a slightly, it's like a really not very trust minimized layer on top of a fully 100% could just run away with it. Trusted layer. [01:09:47] Speaker B: Yeah. So there, there's more trust like way. [01:09:50] Speaker A: Worse than I thought it was. [01:09:51] Speaker B: Yeah, you got to trust the guys in the foundation not to just till your coin. Then you also got to trust the exchange not to get exit scammed or whatever. And of course it's in their best interest. You know, they're not trying to scam anybody. I'll give them benefit of the doubt. They're trying to use the best custodians they can use. They're trying to, you know, they're trying to do it. [01:10:08] Speaker A: Kraken's like a bank now. So you know, like maybe that's actually something to you know, a degree of legitimacy there. But. And I don't know that trust relationship, like it's not, this is anything but could be called decentralized. [01:10:22] Speaker B: Right. And so you know, and they're just gonna give you some tokens on Ethereum that are represented by the tokens or by the bitcoin that they locked for you in an exchange somewhere. So you know, and that allows you to use it. But it's definitely not bitcoin any more than binance is bitcoin when you have, you know, when you're trading somebody on, on finance. [01:10:45] Speaker A: So it's equally bitcoin. It's, it's quote unquote equally bitcoin as tether is, tether is dollars, it's redemptive to one institution and it's completely up to them. Yet. I didn't realize, I assumed it was some just layer of obfuscation, but I thought it might be at least some. [01:11:08] Speaker B: Yeah, I did too. I assumed they had something created some kind of like I assume they'd created some kind of like cross chain lock or something. [01:11:15] Speaker A: Yeah, that's kind of what happened. [01:11:16] Speaker B: And that's what tried to actually they tried to do that, I forget the name of it with I think it was the tbtc. And somebody's gonna listen to this, tell me how wrong I am. But somebody tried to do that where it was like actually done cross chain but like somebody was able to exploit it within like two days and like somehow use like legacy transactions or something to like yield the bitcoin back or something. So like. Yeah, not last long such as their. [01:11:44] Speaker A: Solution so often. [01:11:48] Speaker B: You know, so they have yet to be able to do it in some kind of like actually legitimate way where it would be like locked by your keys because you'd think it'd be theoretically possible and it probably could be with a, with like a small fork or something. But like maybe even you know, it'd. [01:12:04] Speaker A: Be cool if somebody figured that out because there'd actually be something to do that. I mean it'd probably be a model for a sidechain. But that's a big problem. Like that's not something that you're just gonna like code up for a couple of weeks and figure out. [01:12:18] Speaker B: Yeah, you could lock liquidity somehow without any way to steal it because you got to. Because it's not just for yourself. You're minting this WBTC or whatever, then you're going to trade it to other people. So you're going to somehow be holding Bitcoin that you don't own anymore. As long as they hold the token. Like you said, you should be able. [01:12:36] Speaker A: To transfer the key without the key changing on Bitcoin. That's going to be hard to do. [01:12:44] Speaker B: Yeah. So to do that in a way which would be actually cool. Is state chains impossible right now? [01:12:53] Speaker A: Yeah, state chains is actually sort of that kind of model. Exchanging the keys instead of the coins themselves. [01:13:00] Speaker B: You have to somehow the coins, the Ethereum coin will somehow be able to sign for itself to unlock the Bitcoin because you'd want that Ethereum coin to somehow be the key owner of that Bitcoin. [01:13:15] Speaker A: Maybe, maybe you could use an attachment to the like you could use the entire Ethereum miners or stakers or whichever the hell is going to exist at whatever point in the future, which nobody knows. But let's say whoever is on Ethereum, you could have the entire Ethereum network be the federated state chain, the state chain federation for moving Bitcoin keys. [01:13:45] Speaker B: That would be something that, that comes around to Something, you know, there's so many little facets of this, but Ethereum itself is like, the worst is here's the, oh, you're gonna trigger somebody. [01:14:02] Speaker A: You trigger somebody so hard. [01:14:04] Speaker B: This is, this is fame for all. [01:14:06] Speaker A: The things that you do on it. [01:14:08] Speaker B: I know, I know. [01:14:10] Speaker A: Kills me. [01:14:11] Speaker B: So that's why, you know, that's why I say I'm allowed to shit climb, but my friends aren't, because I don't want their reward centers in their brain getting messed up. They're too new. They haven't drank as much as I have. [01:14:22] Speaker A: They don't know how to manage their alcoholism. So you can't just don't drink. [01:14:27] Speaker B: It's like, I can take six shots and drive, no problem, but you better not, damn it. You know, but, but so the analogy I give with like the Ethereum incentives, how like kind of bad it is, is it would be like as if Netflix allowed you to mine their payment portal. So like you had all these people, like, you know, millions of dollars a day coming in to pay their Netflix bill. And anybody who gave like, let's just say proof of work hash power to that payment pool, you would get that much percentage of the payment that were being put in that day. So, you know, so if you could imagine if Netflix were like a blockchain thing and get all these people hashing for the percent of that, those payments coming in, that makes sense. But now that's Ethereum, except nobody pays for any of the movies to be hosted and served to people. There's no reward to host all the Netflix content or to create any of the Netflix content. There's only a reward just there in mind the payments. So why does anybody host terabytes full of like hd, HDR movie content? Somebody has to, otherwise nobody will pay. But nobody wants to. So end up happening is like one guy that basically has the biggest stake does it? And it's very, very, very centralized. And it never will not be centralized because from the very beginning, like, there is no incentive for people to equitably share in like hosting all of these files and running all these programs and doing all these things. [01:16:02] Speaker A: Like, you get essentially the same problem of bsv. And like I tried to talk, like, I tried to explain like, like nobody is going to run a full node if running a full node is not attached to like, like nobody's going to run the data, like store all that data. And it's like, oh no, we're gonna re, like literally think that they will rebuild the Internet on top of a blockchain And I'm like, why would Amazon want to also house everything in Google's servers and then mine on top of it to get fees that they're already getting directly to them? Like, why would that be a better deal for them? And then I will literally get told, oh, well they'll. Then they'll just, they'll select, they'll pick and choose which opera turn data they want to actually house and then they'll get paid selectively based on, you know, if people want that data or not. And, and I'm like, so like the Internet, like people will just house servers with whatever data they think is actually useful for whatever reason. And you will pay them for that, like, because you didn't do anything, you didn't change anything. And the fact that you hashed it, if nobody's got the whole chain, nobody can verify any of the data, then hashing it doesn't do anything either. You got. It's just a waste of time and resources. It does nothing. There's no assurances, no guarantees, no immutability, nothing. [01:17:30] Speaker B: So those are horrible incentives that lead to obvious centralization, which makes it very easy to control, very easy to censor if they wanted. And so, and especially it's bad for proof of work. Now for proof of stake. You know, centralization is actually rewarded in proof of stake. Yeah. So sure. Like in proof of stake, if I'm the owner of most tokens because I had a big pre mine and so now I'm making, you know, 30% of all of the network fees and inflation or whatever. That's a big like, you know, that's a big paycheck for me to make sure that the network's running nicely because I basically own it, I own this network. So I'm going to make sure that has servers and I'm gonna pay AWS to host all your Ethereum stuff and. Or your BSV stuff, because that's what's gonna happen. They're gonna put it on. I had a guy in BFC tell me one time they would just back it up when it got too big and they wouldn't care. I said, we're gonna back it up because like it was going to be. [01:18:28] Speaker A: The Internet hard drive. [01:18:32] Speaker B: He told me bsv, he told me they would back it up on the chains. [01:18:37] Speaker A: What? Wait, like Amazon was gonna back up onto bsv? [01:18:41] Speaker B: BSV was gonna back up the miners with their full node once it got too big. They'll just back that up on bsp. So you're gonna have like, what it's like, this is too big for us. So we're gonna put it all together and put it again on the same chain. It's a big redundant file on the. Like we're gonna put. [01:19:04] Speaker A: We're gonna back up our hard drive on the hard drive we already have. [01:19:07] Speaker B: Yes, exactly. But anyway. But anyway. [01:19:13] Speaker A: That can't be representative of everybody though. Like some people who know. Who have reasonable. Like, like, I know at least Daniel Krawitz wouldn't say some dumb shit like that. [01:19:25] Speaker B: I don't know. I don't give him as much credit as people too. I don't like everybody. I think it's just because he was so early in bitcoin. People describe so much like weight to what people say just for being early to Bitcoin, dude. [01:19:37] Speaker A: Bitcoin OGs, stupid or not, Bitcoin OGs are still treated as OG. [01:19:43] Speaker B: So Krause, for example, he's like, he's legitimately an idiot. I like to think that I can identify with, like, even somebody smarter than me is saying something smart. Like when you talk, for example, you're way smarter than me. And I can. I don't have to understand all the economics to know like, yeah, that's actually some pretty. [01:19:58] Speaker A: You flatter me. You flatter me. [01:20:01] Speaker B: But. But with. When crowds talk, it's like, no, I do not see it. Like, I do not see any wisdom there. It's like Babel idiot shit. It's stupid. Like, it's really dumb when he talks. [01:20:12] Speaker A: There'S no have to change. I'm gonna have to hide your voice. I'm gonna have to disguise it. [01:20:16] Speaker B: But anyway, so. So the proof of stake thing though, not only is it very centralized and every shit coin has to find a way to make money on their shit coin. Ethereum had a pre mine. That's why they need to go proof of stake. It's the only way that they will be able to not run out of money. Because right now they're having to compete with the free market to mine this thing to get some of the fees, but they have to pay all the bills. So it's like they have to compete with everybody on a free market, but they're the only ones who have to pay the bills. Because if they don't pay the bills, nobody will pay the bills and because there's no incentive to pay the bills. Yeah, so. So they're like, you know, bleeding their pre mine to pay salaries for all these people and to pay AWS fees for the nodes, obviously, like, it won't last and the way they're building is stupid. So they, they need proof of stake so they can park that free money they got out of thin air for themselves and then make perpetual income for doing literally nothing. Like, they need that now. Now, you know, now they can pay the bills because they make a chunk of the money and like, it rewards their centralization. But what people I think are not realizing is like, this is the same kind of system that we already have. Like Vitalik's kids are gonna run Ethereum and not know anything about it. Like, you know, these big stakeholders today. Like, it's, it's, it's gonna be like, what is it, oligarchy or It's a distribution. [01:21:33] Speaker A: It's funny, like, what was, what was. The way, God bless, the wording was really great. And now I can't even remember who it was. Might even be Michael Saylor or somebody said it. God, I don't remember. But it was something to do with. Proof of work is like distribution of the energy cost to protect Bitcoin. And proof of stake is just distribution of the authority to control. Like Ethereum. Or you know what, it's a really. [01:22:08] Speaker B: Really, really good way of saying it. And that Kaiser, know what I'm saying? Like, you know, if Vitalik has some like, bratty kid that, you know, grows up to be 18 years old and hates Ethereum but loves the money, it makes him like, he'll do whatever he wants to do. He'll, he'll sell it to fucking Microsoft and let them put in, you know, whatever. He doesn't care. Like, he doesn't understand it and he doesn't care. [01:22:28] Speaker A: And we've already seen the takeover like, like what it looks like as, like a hostile takeover and how easy it is too. Was Tron did the staking like Steam, quote, unquote? Yeah, Steam. Thank you. The hostile takeover, just by using the Exchange, just, you know, bought the Exchange or was working with the Exchange or something like that. I can't remember. Yeah, and, and they just had the most staking. So it's like, oh, wait, well, this is what the network's going to do now. This, this is, this is our change. Good luck. And you have to, you have to fork off to a minority network or, you know, whatever it is and hope that it doesn't completely obliterate the project. [01:23:08] Speaker B: Those incentives are horrible. And so this is. What if. I hope some Ethereum person listens to this. Really, like, this is what the Ethereum thought leaders are not understanding about Bitcoin. Like, Bitcoin understands that Power corrupts. Bitcoin understands that if you give even a little inch, somebody's going to take that inch and try to fit an elephant in it. If they can, they will. [01:23:34] Speaker A: That's why it's just no hard forks. That's why it's just like only in the absolute nuclear scenario is a hard fork even considered. If there's even a potential soft fork solution that can be made. That's it. Because it's not about politicizing the monetary policy or the rules, the monetary rules in a different way. It's about removing them from the political discussion at all. Because that's what's unique about it, is that it is digital, yet it is. The atoms of Bitcoin are as defined and as clear as the atoms of gold. There is no, there is no governance token for what makes gold and what makes mercury or lead right around it. Like it just is gold or it is not gold. That is what Bitcoin did. It. It completely secured a monetary policy and a set of rules that is independent of all of our stupid bitching and subjective values over, like, what might be or who should be in charge or what, which. That or any of the other things. Like all that stuff is nonsense. And we recognize that it's all nonsense and it should not be part of the discussion because then we have an independent money that even one person who hates another person can independently trust. It is money for enemies because nobody controls it. That is the value. Not because we control it in a different way. [01:25:06] Speaker B: Yep. And that it's completely immune to oversaturation. [01:25:10] Speaker A: Yeah, it's. It only does things that are sustainable within the ecosystem of Bitcoin, like anything external to it or any inflation. It's just, it's not part of the game. It's. It is a closed loop of Bitcoin within Bitcoin. And we don't even take outside information and put it on there. Like we know that it's. All of that stuff is pointless. Like, there's no guarantees. You can't, you can't put voting on the blockchain. And you know, as soon as human input is in it, it's arbitrary. It's. It's meaningless. So the rules are about the things within Bitcoin. And that's why it has assurances. That's why it has the, the most, the most powerful economic and financial assurances as anything in the world. There's nothing. There's no bank, there's no ledger. There's no, nothing anywhere that can possibly give you the guarantee of accuracy. Of settlement of you definitely own it. And there's nobody that can contest this as bitcoin, period, Hands down, no questions asked. [01:26:09] Speaker B: Yeah. If you're holding on to sushi token or whatever, like you're holding a super, super shitty. You're holding a super, super, super shitty version of something that's, you know, if you could call it a version of bitcoin, it is like very, very down on the totem pole there because you're. You're holding something which is a copy of something which is a copy of something which will be copied tomorrow. Like, you know, and the. [01:26:36] Speaker A: You're going to be wanting to dump all your sushi for sashimi tomorrow morning. [01:26:40] Speaker B: Exactly. And actually somebody will make a program where you stake sushi and get sashimi. Literally what's happening. And the sashimi will not even have. [01:26:51] Speaker A: A reason help us. [01:26:56] Speaker B: So I hope that nobody is taking away from this. They need to go play in that casino or definitely there's no future there. Like, I got friends that try to. [01:27:06] Speaker A: If they do, they deserve it. Let them take whatever stupid risk they want. All we can do is inform. [01:27:12] Speaker B: You don't understand, man. Like, defi thing is just beginning. Like the same guys that tell me that are the same guys that are like, buying the tail end of the newest Ponzi scheme. And I'm watching them because they'll tell me to buy it, you know, and I'll watch it. [01:27:26] Speaker A: Yeah. [01:27:26] Speaker B: And like they're. They don't get what's happening. Like, they just see it as like, I don't know, some kind of ethereal new tech. Like there's incentives there. There are incentives there that are playing out and they're playing out predictably. [01:27:40] Speaker A: Yeah. [01:27:41] Speaker B: And that's why, you know, I would hate to be somebody that bought Ethereum. I haven't have, you know, a little theory for paying fees on you swap, whatever right now. And like if you look in my portfolio, like for the week, like right around when the defi. Whatever hype started, like blowing up. If you buy a theorem at that time, like the Ethereum I had, it's a little bit. It's down or 15% in my. In my wallet. Whereas the bitcoins only down in the same period, like 1.1%. [01:28:11] Speaker A: Like you're getting Ethereum since the defi mess. Ethereum is actually down in bitcoin. [01:28:16] Speaker B: Well, not since the very beginning. If you got in, like before anybody was saying, oh, new defi hype, then. [01:28:21] Speaker A: Yeah, I was meaning like, yeah, at the, at the hype though, like no. [01:28:24] Speaker B: But if you bought like, if you buy like, oh my God, this defi thing is blowing up. Like, yeah, if you bought the Ethereum went up to like 450 and now it's 346. [01:28:32] Speaker A: Oh, wow. [01:28:33] Speaker B: So you lost like 25% of your, of your. Oh, fuck Bitcoin. I'm going to buy Ethereum. It moons every day. Like you're down 25% in SATs. [01:28:44] Speaker A: And that's standard. [01:28:45] Speaker B: That's like, you know, the thing is like somebody bitcoin never pumps. Like the shit coins. You sure they'll go up? [01:28:52] Speaker A: Because it's actually liquid and huge. [01:28:55] Speaker B: They'll go up 30% when Bitcoin goes up 10%, but then when Bitcoin goes down 5%, they'll dump 40%. And this just happens. [01:29:03] Speaker A: We have seen this just happened. [01:29:06] Speaker B: Yeah, this happens all the time. So sure, if you're like some genius trader, obviously you can make money on this kind of volatility. Like if you get in right before every shit coin pump and you get out before bitcoin dumps, you'll make money. But like, you know, obviously, good luck trying to do that. If you're holding the shit coin though, I wish you the bleeding shots. If you're holding a shit coin, if you're holding a theory, I'm like, well, what if. Just in case, I want to head. Just in case, like, oh God, like there's no hedge there except for like, anyway, you're gonna bleed sats. There's no chant. Like, if you're thinking I'm gonna hedge. [01:29:39] Speaker A: Apple with this penny stock, I'm just. [01:29:41] Speaker B: Holding a little bch or a little ethereum as a hedge. Like, if you think that there's any chance that that is like, like you're not understanding what's going on. If you think that they are, like, it's not a popularity contest. I have to tell people. It's not like people think it's popularity contest because the stock market, the stock market you can take for granted at the assets themselves on the market will continue to exist. That like, you know your Tesla stock at whatever it's worth, it's not like the Tesla computer is going to collapse and even though everybody was buying the stock, like you can't sell it anymore because the network broke. Like you can take for granted that. [01:30:18] Speaker A: It is actually capital assets in a business there. [01:30:21] Speaker B: Well, but not only that. What I'm referring to is like the fact that you can buy the stock. You don't have to think about the infrastructure on the Stock. [01:30:29] Speaker A: I see what you mean. Yeah. [01:30:30] Speaker B: You don't have to think that. Like, so in that sense it's a part. If everybody decides to bet on Tesla or this whatever, if there's some dumb company that's really dumb and everybody decides to bet on it, like you can sustain that company probably indefinitely on speculation. And like, if it wins the popularity contest, it'll be a massive stock and massive gains for everybody in crypto they take for granted. It's the same way some people think, if everybody decides with their smart brain they want to buy Ethereum instead of Bitcoin, that they'll just all get rich because there'll be way more money Ethereum. But they don't realize is it's not like the stock market, that underlying network does not have a right to exist. Nobody. It doesn't. They're not gonna like boot it up again. If it like the Fed infrastructure and those incentives suck, that network collapses. It doesn't matter how many people bought it, you lose. [01:31:15] Speaker A: Yeah. [01:31:15] Speaker B: Like it's not a popularity contest in the same way it matters what the network incentives are. [01:31:21] Speaker A: Yeah. And, and what's funny is the more, the more and more valuable it becomes, particularly if it's got a broad attack surface, the more and more valuable it becomes, the more money there is, the more powerful the incentive to try to kill the thing to short to bet against it. [01:31:42] Speaker B: It's going to break under its own weight. Like, you can't have that. [01:31:44] Speaker A: That too. Like, you know, particularly if they've been. [01:31:48] Speaker B: Increasing, definitely they've been increasing block sizes. They're already trying to make excuses for like not needing to hold, you know, any archive information because who could, like, you're going to have like one company being paid to do all the telling you what the history is. Like, you might as well be the Fed. Like, you might as well be like, you know, like, hey, we trust this one company. Why would they lie? [01:32:10] Speaker A: Like, why would they stay consistent? Like, like, why after like the span of time that like some people are going to be coming in and out of that company, it's going to change owners. Why could you, how could you possibly expect it not to lie to you at some point? That's the whole point of this, is that we don't understand inevitability and people. [01:32:30] Speaker B: Don'T understand, like, how clever people get when they can be. You know, if you gave me full control of like Ethereum history and governance, you know, before you know it, I'd add some innocuous sort of rule that said, like, well, if the wallet hasn't moved in X amount of time, you know, maybe we'll just like recirculate that into the foundation, you know, and most people won't even know that that's happening. And the ones that do and whatever. [01:32:54] Speaker A: How many would check and how would you, how would you contest that? You know. [01:33:01] Speaker B: Yeah. And then before you know it, I'm thinking, well, you know, just like the United States has done with some of their like, well, technically we're not going to spy on any American citizens. Oh. But yeah, yeah. Even though that's a law, like, you know, we've got some kind of other obscure law here that maybe. Well, technically this guy's kind of American. Kind of not. I could like. Well, technically this money was kind of like an old wallet, but kind of not like. But statistically we know that there was probably some money there. So statistically I could say that, you know, it's probably like an extra 200,000 ether that I probably could get. We just don't want to spend the resources to find it. So, you know, like this is going to use statistics and math and we're going to just say that, you know, I'm owed 200,000 Ethereum today and who the fuck is gonna like, that's how it happens like before, you know, like there's nobody checking me. It's just my rules and my little logic. And I'm just printing money again. We're back to printing money again. And that's like very inevitable in my opinion, that you're either gonna print money or you're gonna find more ways to give more money to yourself because that's what the incentives are. And nobody can check. [01:34:03] Speaker A: There's no defensive measure against it. If there's no if there's no spectrometer to prove that it is gold. To prove that it is the exact same asset from beginning to end with consistent rules. Full nodes. If they don't exist, then it's going to get abused. It just is. Seems like it's just a matter of time. [01:34:27] Speaker B: If you want something that protects you from that, Bitcoin is the only choice. [01:34:30] Speaker A: Run a full node. Be a Bitcoin og you can be. [01:34:35] Speaker B: An OG today, you can buy bitcoin today. [01:34:38] Speaker A: First class bitcoin citizen baby. [01:34:40] Speaker B: Anybody buying bitcoin today is still going to be like, seen as a genius in 20 years. So in my opinion, yeah. [01:34:49] Speaker A: And you don't ask anybody. And it's not about like, who do I ask whether or not I own this bitcoin. I ask Myself, I ask my node, my node tells me, if I own. [01:34:59] Speaker B: Bitcoin, you are the bitcoin network. I am. Which is beautiful. I mean, it really is. It really is beautiful. Like, you know, when I hear these people say, well, the network is going to. And I'm like, dude, you're the network. Don't tell me, like, what the network's going to do. Like, there's. I don't have to ask anybody anything. Like, I'm running bitcoin. I am the bitcoin network. The bitcoin code is right there doing exactly what it's supposed to do. And anything other than that is not bitcoin. [01:35:28] Speaker A: That is probably a great place to stop this episode. Dude. Thank you so much for this. If this continues, maybe for the next one we should talk about governance tokens, since that has come up recently. And that is another very fun and confusing and ridiculous topic. And hopefully bitcoiners go for this. Hopefully they enjoy this, but this was a wonderful episode. I had a blast. I told you we'd have fun. Thank you for joining me on the first shitcoin Insider. Good, sir. [01:36:04] Speaker B: Thanks, man. [01:36:05] Speaker A: All right, man, I'll catch you later. I hope you had as much fun listening to this as we did recording and digging into all of this stuff. And honestly, I would love to do this again, but I want to know what you guys think. Are you interested? Do you want to keep hearing about shitcoins? Does it matter to you? Let me know. Subscribe to the show. Throw me some feedback on Twitter TheCryptoConomy or ITCoinAuto. Either or. I am very curious to hear your thoughts, but for now, we are out. And maybe I'll catch you on the next episode of ShitCoin Insider.