ROLLUP: $ARB Airdrop | Do Kwon Arrested in Montenegro | Coinbase Wells Notice | SEC Charges Justin Sun

dokwan was just arrested Montenegro David you excited about that ladies and gentlemen we got him bankless Nation happy fourth Friday of March David what time is it oh Ryan it's the bankless Friday weekly roll up where we cover the entire Weekly News in crypto especially this week is uh absurdly crazy uh I feel like I say that every single week but it just keeps on getting crazier uh and so that's what we're gonna do today cover the entirely Weekly News in crypto with coffee yes

and you have a new Vista behind you uh where are you today you're not you're not in your your place I'm very very far away from New York I am in the Dominican Republic I'm a pleaser Dow folk and other people around the crypto space uh tropical location and you're right and there's uh there's so much to cover I feel like the 2020s are just like this like every week is going to be a little bit crazy um that's how it's felt since uh covid maybe before that I don't know uh but let's talk about what we're doing we got some big topics of the week number one the arbitrum airdrop has now dropped did

you claim it we got a price we gotta talk about that what else are we covered uh both Balaji and Hayes Arthur Hayes are signaling wartime for crypto on different time frames but both agree directionally that this is the big one so we'll talk about what that means and also all the people who think that they are both full of we'll talk about that uh and then on different front lines uh the SEC has issued a bunch of Wells notices and subpoenas uh these are real facts not just rumors this time so

we'll talk about all of those um interestingly uh coinbase got a Wells notice but coinbase seems pretty ready for it so is this the sec's final push and then breaking we uh bankless broke this you wanna you wanna talk about what bankless broke around though Quan was arrested in Montana uh yeah well you know what he he kind of broke himself after he broke Luna and Tara uh and now he's been arrested I guess in uh we'll tell you where we'll tell you the location and the details when we get to it um all right David

before we get into it this is a message for the dev listening to bankless if you are a developer did you know for you amazing developers uh out there that there is now an nft API that is being provided by infuria really cool new product from infuri David you want to tell them about it yeah so if you are an nft Builder this is for you this is a new SDK kit that provides you the tools to write across five different blockchains all the smart contract templates for ERC

721-115 to allow you to aggregate your data across all the chains so whether you are building something that mints nfts buys nfts sells nfts Etc uh inferior has got this SDK to help your Builder life get easier so there is a link in the show notes for you to access all of that SDK information you can register with inferior and then you'll be able to make an account and get that SDK and Builders thank you for being a builder make this space better this is definitely the the build Market not the bear Market uh speaking of markets let's

get to the Bitcoin price are we up on the week or down oh we're a bigly on the week start of the week 25 000 a very respectable twenty five thousand dollars is where we started we are up 10 Ryan oh over 10 since I put these numbers in we are right twenty eight thousand two hundred dollars we were up last week too right green very very two very green weeks for Bitcoin I'm uh I'm zooming out on the Kraken charts here Kraken Pro of course you know what thanks to Kraken for providing these fantastic charts uh this is a another big week back to back two

in a row we'll talk about Bitcoin a lot because I feel like it's narrative season and Bitcoin is in the spotlight but before we get there eth price what are we doing on the week East price starting the week at 1660 it was up six percent when I wrote These numbers down when it was 1750 but we have just hit a very large green candle we are all the way up to 18 15. so okay this is a moment bankless Nation pull out your price Checkers check yourself that's the actual price we are recording this at 11

eastern time on Thursday yeah so we are almost 12 hours behind you if you're listening to this Friday morning so uh right now for us ether price is 1818. for you guys I don't know what it is yeah well we're like 24 hours behind you guys probably um eat Bitcoin what about the ratio that tells a story of itself ratio David yeah what about the ratio are you sad about this because I bet the ratio is is it up or down from last week it's down from last week we were down five percent on the ratio so we are down to the low low price of

0.0645 we hit uh almost as low as 0.062 which is uh lower than has been in a long time uh uh not lower than it was for the three Euros Capital liquidation that was really low uh but uh it is pretty unequivocal that Bitcoin has won the last two weeks Bitcoin smash whole season for Bitcoin Bitcoin smash it's gonna be okay though David like are you are you upset about this or is this just whatever noise like this is a 18 plus long-term hold so like the a two weeks of Bitcoin

narrative season is not I'm not sure my Reserve is not shook um can we zoom out Bitcoin ordinals does not change my thesis about about ether uh when in doubt zoom out David how far should we zoom out to uh to make these numbers feel better for you should we go all the way back to you 2021 right so on the far left of the screen right zoomed out all the way to 2020 when the Bitcoin ratio was down to .025.03 where we're over double that and so ever since this bull market when ether hit the went from .03 to 0.09 or

so uh we haven't gone down below that so you can see the three rows Capital liquidation area uh in July of of 2021. uh so we are still at this flight plateau uh but we are at a local low in The Ether uh appreciation versus Bitcoin from the last bull market yeah do you remember this whole season here was this after defy summer where there was it was a huge Bitcoin narrative and the question was did you even need ether as an asset you could just buy tokens plus Bitcoin plus Bitcoin you got the money

and you got the um the finance systems and then you get full exposure to the market that was the narrative and that's what we were seeing over here it's funny you can get into that age-old question of does price Drive narrative or does narrative Drive price which is like the answer that always to me has been yes uh they drive each other and uh so we're definitely in a good narrative season for for Bitcoin maybe we'll get to that in a little bit but uh crypto market cap is up on the week question mark uh slightly up on the week yeah we are at just below 1.2 trillion dollars 1.198

trillion okay well um let's go over to Powell's world and the central Bankers for just a minute um we'll talk about more Bank stuff later in the episode but the FED just hiked rates by a quarter so they had a meeting on Wednesday this was a much anticipated meeting what are they going to do the answer is they're going to hike rights by 0.25 or a little so yeah it's not the 50 basis points that some people said that they might do um lower than that and then they also signaled some things too

um the increases might stop soon Jerome Powell said that the committee is considering pausing hikes but because this is his quote events in the banking system are likely to result in tighter credit conditions that's a interesting phraseology events in the banking system uh I'll say yeah a bank run might be considered an event a crisis is an event yes uh Janet Yellen is also weighing in she is of course Secretary of Treasury of another important monetary institution in the

United States she said that treasury isn't even considering guaranteeing all Bank deposits without Congressional approval so that's been a question mark that people have been asking about so with with the bailout of of some of these Banks the deposit bailout of you know signature and Silicon Valley Bank depositors made whole does that mean de facto that the treasury is going to guarantee all depositor accounts in every single Bank and Yellen says uh don't go that far that would take an act of Congress right

expectations we need Congress to give us the thumbs up on that one my question to you David is like um do you think she means it or do you think it even matters do you think that by the time you need to go to request to Congress for something like this they're going to rubber stamp it anyway what's your take here uh so uh the take here that I think is safe is that the powers that be be it Congress the FDIC the FED are always going to aim on the side of mitigating paint um the bank term funding program has this one year term on it as in at that

facility goes away after one year uh but is it really gonna do that or are they just saying that because they want to Tamper expectations the best that they could tamper our expectations the more that we are pushed towards normal Market behaviors but I think everyone is ready to call their Bluff because ever since the 1933 Great Depression the money military policy and fiscal policy of the United States of America has been to mitigate pain mitigate pain mitigate pain so I think it's safe to assume that they are going to make choices that

mitigate pain regardless of what they say that program that you mentioned uh what's that call again called again and say that again Bank term funding program btfp you might be hearing that acronym a lot btfp if it doesn't mean anything to you I encourage you to go listen to the Arthur Hayes episode that uh we published earlier this week was fantastic David was doing it solo I was busy and uh Hayes just gives kind of a run through and explains monetary policy he explains this new acronym that I think you need to learn about you need

to know this this is like the quantitative easing of uh 2023. this is the big um like I guess stimulus this is the big money printing event that is actually happening in the background quietly you David said um I don't know if you actually said this but like it's uh they announced this last Sunday I believe the btfp was this last Sunday I don't know sometime in the last week or so and they said it was only going to last for a year people like Arthur Hayes are incredibly skeptical they're like

they're gonna do this and they'll do it forever and it'll never it will keep on getting renewed up to infinity and anyway he has a much better way of explaining all of these things and the simple way to explain it is that like okay the bank term funding program is meant to be used by Banks Banks will therefore use it and settle into this new equilibrium that is created by the bank term funding program once the banks get accustomed to this program undoing the program is hard especially when

everyone is ready to call the bluff of like yeah one year not if we use the F out of this new facility that you just created for us and lock ourselves into that new paradigm and so unwinding the bank term funding program after people get okay what is the bank term funding program all of the illiquid underwater long-term bonds that Banks bought they get to borrow against those bonds even though the mark to market price is down 30 10 whatever down something bad they get to borrow against those bonds at the full value of them at par at maturity so

they get to print free money essentially unwinding this program after they have already engaged in this behavior is going to be hard and deflationary and cause pain which is why we are going to assume probably it's safe to think that they are just going to extend the term on this so if fully used the btfp would print about another four trillion dollars this doesn't happen to me 4.4 4.4 trillion and we eased we didn't print well we did print we eased QE 4.1

a trillion dollars in covid and the bank term funding program has 4.4 of available money issuance to it so covid the largest money printing 2020 episode in U.S history since World War II we're gonna do another covid it seems like that's what the covid plus another cherry on top plus a little more and then that's not even the end of it uh by the way you got to listen to the full episode on how we get from 4 trillion 4.4 trillion to potentially like something like 17 to 18 a trillion

dollars of money printing if the next Domino Falls after this anyway a lot going on we'll get more to the banking crisis uh in a minute but let's uh talk about volatility well we're on the topic of markets Banks down coins up volatility up what are we looking at I think this chart really just tells a very different story without even understanding what each one of these lines are for the bank for the podcast listeners there's about 10 12 15 lines on this screen uh they're all going horizontal and to the right and then the crisis happens the banking crisis

happens some lines go up and to the right some lines go down into the right uh the theme Here is the ones that went down into the right are all banks the ones that went up and to the right are crypto assets and volatility and I think maybe there's also a Chinese Bank in here Chinese Banks up into the right I could be mixing up my charts but basically the summation of this chart is that Bitcoin and crypto assets are up bankless is up if we want to use our own terminology for this uh bank banklessness is up banks are down and also volatility so yeah banks are so 20 20. yeah

you know it's like this is incredible this is the bifurcation right bankless assets up volatility also up because things are crazy Bank bank stocks go down um that's all part of the story too that we we've been talking about uh this is a take that um you tweeted out which has been sort of um a theme of our episodes this week and it's not the the conclusion of the theme but I think has definitely been a theme of the past you know two three episodes that we did Bitcoin in times of war ethereum in times of Peace who tweeted that out

David Hoffman what Bitcoin or eth Maxwell as David Hoffman tweeted this out is that is that really what happened David this is not the first time I've given out this take this is a take that I've had in my back pocket for a very long time uh and now this is a moment where the market kind of understands this a little bit better um Bitcoin the philosophy the design philosophy of Bitcoin is reduce reduce reduce the code make it more simple make it more invisible make it harder to track make it more self-sovereign remove

all utility from it because you need to do one thing which is hold your store of value it has this wartime crisis moment mentality in the design philosophy of Bitcoin uh the whole idea even if you could add in extra features nft features and this is why some sometimes ordinals have triggered people if you could add in D5 features that would be extra baggage extra surface area if you added to nft Features smart contracts it would be extra baggage that would make Bitcoin less suitable to times of Crisis and so what does Bitcoin do it does one thing

which is store your money in a way that's outside of the system adding in extra features in the Bitcoin philosophy is making it harder to use in a wartime crisis moment and so during times of Peace Olive leaks layer 2 smart contracts account obstruction nfts defy nft Phi identity these are all innovations that happen during peacetime uh when times are stable and we can invest in Innovation and progress and

development uh and there's a pendulum in humanity between peace and War uh and so the claim here is that the philosophical design of ethereum is suited to peacetime and the philosophical design of Bitcoin is suited to War uh bankless is known at least me and Ryan not not the analysts uh of the newsletter but at least me and Ryan are known to be uh ethereum biased um some white say ethereum axes I think Ryan you and I are disposed towards peacetime growth and Innovation other

people are disposed towards let's make sure that Bitcoin does the thing that it needs to do in the worst possible moments of time in crisis moments uh and that's not necessarily our disposition but I think that is a valid disposition and as the pendulum of the world shifts from peacetime Innovation to crisis capital controls uh restrictions uh Fiat inflation uh Fiat demise like all of a sudden that pendulum shifts into wartime and that is my I remember last week Ryan

we were talking about I said like I don't know why the Bitcoin ratio is is versus ether is up so big this is my this is my answer for that uh we have shifting from peacetime into crisis time and Bitcoin the narratives of Bitcoin whether or not they're legitimate in the foundations the narratives in Wartime benefit Bitcoin and that is my take do you want my take on your take uh sure so there are elements of that that I agree with but I think that the last part of what you said is like what uh I agree with most and the rest

um I don't um probably so I think that there is a difference between um product Market fit and narrative Market fit right product Market fit is does the thing do what it's supposed to do and provide like actual utility for what it promises okay and that's one component of it you know um everyone always talks about product Market fit when you're startup and technology is the same does it have product Market fit like uh iPhones had fantastic product Market fit for instance right

um uh you know some other products that we thought were going to be revolutionary never never had product Market fit and then there is something else which is narrative Market fit which is like is this are we at the point in the storyline of humanity where this narrative is going to um specifically have a moment whether this is narrative is specifically going to land I think Bitcoin has incredible narrative Market fit for this moment in time but I actually but I actually think

ethereum has better product Market fit for actual wartime all right so so like if you talk about proof of stake I would 100 argue that having um thousands tens of thousands maybe hundreds of thousands of decentralized validators around the world that can run validators from their own homes locations wherever they have an internet connection and it's much more large-scale mining operations yes it is much more censorship resistant in times

of War than something like uh proof of work for example um I think that uh ethereum provides not only the like the verb of transact which Bitcoin provides in a censorship resistant way but it also provides the verb of trade like how do I trade Bitcoin for some other asset that I want without going to a centralized custodian the answer is I can't with ethereum we have uniswap we have decentralized protocols so like both ethereum and uh Bitcoin are

bankless but ethereum provides more money verbs more bankless things that you can do and therefore is a better system in times of War but here's the difference it has not captured that narrative at freaking all yes and then the culture of ethereum I agree with you here totally does not lean into that right you don't find that unicorns and rainbows yeah bitcoiners are gun people exactly they're they're like the um you know the doomerism like like let's quick let's grab all of the Bitcoin we can

because the world's gonna end and there's only 21 million and then we'll get kind of these uh you know underground bunkers and you know like a theory is just not that little podcast out there called Bitcoin and guns do you know that is it really yeah so so um anyway I what I would say is that um what I think we are seeing is also a narrative trade we see narrative trades in the past David like remember when there was narrative Market fit for scalability on uh crypto networks because ethereum gas fees were way too

high we got all of these chains that pumped on narrative Market fit not necessarily product Market fit now I will say narratives can feed product Market fit especially for a meme energy asset like a monetary asset and so that is another Wrinkle in this where if enough people believe Bitcoin is money then it becomes money and then it you know reaches greater product Market fit uh but yeah that that is the subtlety I actually think ethereum is um better in times of war from a practical product

effective then Bitcoin it just doesn't have the narrative at all for that I think if I said that that ethereum isn't meant for war Justin Drake would like roll in his grave nothing yeah no because we have so all of these like cryptography Tailwinds to protect ethereum yeah maybe maybe there's an episode out there that is like the ethereum case for wartime just to just to tie off this last bit of conversation we can move on uh Bitcoin born in the banking crisis born in the 2008 financial crisis now we have another banking crisis imagine there's still

more Capital outside of crypto outside of Bitcoin than there is inside of it and all of the Trad Phi wealth managers who I will perhaps unfairly claim are 100 IQ middle curve belt uh money managers I'm doing the thing they were taught in school exactly yeah right and so they're they're going to like think about this banking crisis and they are going to consider alternatives because that's what Arthur Hayes are saying is like you must consider alternatives now and so they are going to think in their brain banking crisis Bitcoin it even is

an alliteration right which actually does sound better it sounds better and so just like Bitcoin not Banks that's yeah Bitcoin not Banks like oh there's this is oh this is what Bitcoin is for even Bitcoin I think it's a lot of Tailwinds be because it's more of an idea than it is actually an execution like Bitcoin is a grandiose idea for whatever oh yeah people associate all of the features of crypto into Bitcoin sometimes naively before they unlearn about the actual fundamentals of Bitcoin but for the people who are on the outside who just understand that crypto

exists to the best of their ability they're thinking Bank crisis question mark Bitcoin and that's all they have to think there you go and uh by the way if if you're listening uh but neither David nor myself consider ourselves a maximalist ethereum Maximus if anything we are bankless maximalist decentralization maximalist uh and so I'm happy to the extent Bitcoin remains bankless which it is to uh support Bitcoin in all sorts of ways okay the crypto VC list moving on uh this was

really cool here's a VC list from 2020 the top 300 Global crypto VC firms by Fun Size and investment activity Ryan Alice has been a guest on the podcast previously his firm uh coinstack put this out I wanted to highlight one thing okay here's a quote from uh the the report really even as the the bear Market is here is the moment there's three times as much Capital going around as last time the digital assets industry is maturing we're seeing much more institutional Capital stick around this time this is a big deal okay in the 2019

bear there was about 470 million million dollars going from VC into like building crypto projects and crypto infrastructure in this bear Market the uh 20 late 2022 and 2023 Market there is 1.5 billion dollars a nice little 3x on that that is so like the money that is going to build and invest in future crypto startups has never been higher and uh continues to flood in that was

the big finding of this report and I think it's super bullish we've called this um the build Market not the bear market and like the capital inflows are reflecting that as well there's also bankless listeners a link in the show notes if you want to see who's moving the most money like it goes through uh you know a16z all the way to like Galaxy interactive all of the largest uh crypto VC funds and I I found that data really interesting uh anything on that David before we move on yeah uh We've we've

talked I've gone back and forth I was like man this spare Market is not so bad to oh my God this bear Market is so bad at least in terms of capital flows into people's salaries to allow them to maintain to work in crypto during this bear Market that has been better than it's ever been so wow we've still had the FTX we've still had the alamitas and and the three hours capital and the dokwans at least we are still paying people's salaries that's right and look we needed a cool down anyway it was getting out of hand so um yeah so I feel like it's much

healthier David what do we have coming up next oh my God we get to talk about the arbitrum airdrop uh the price has been I've been watching The Price It's been jumping all around so we're going to talk about what price is the ARB token uh well just a few hours later bankless listener you're going to have them more information so this is the time to pull up the art price and you can tell us but in addition to that coinbase and Sushi swap has received a Wells notice a sushi swap received a subpoena Credit Suisse we're going to talk about the collapse of Credit Suisse and the banking crisis that is hit Europe and we also have an

Euler hack update uh it's good news we think so we'll talk about that and more as soon as we talk to some of these fantastic sponsors that make this show possible especially Kraken who according to uh biology and Arthur Hayes uh you need to get out of the Fiat banking system uh so I would suggest that you use Kraken to go from Fiat to bitcoin if that is your asset of choice uh so if you're going to flee the financial system make sure you use Kraken our strategic sponsor for 2023. let's go Kraken has been a leader in the crypto

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interface Kraken has a 24 7 365 client support team that is globally recognized Kraken support is available Wherever Whenever you need them by phone chat or email and for all of you nfters out there the brand new Kraken nft beta platform gives you the best nft trading experience possible Rarity rankings no gas fees and the ability to buy an nft straight with cash does your crypto exchange prioritize its customers the way that Kraken does and if not sign up with Kraken kraken.com bankless how many total airdrops have you gotten this last

bull market had a ton of them did you get them all maybe you missed one so here's what you should do go to earnify and plug in your ethereum wallet and earn if I will tell you if you have any unclaimed airdrops that you can get and it also does poapps and mintable nfts any kind of money that your wallet can claim earnify will tell you about it and you should probably do it now because some airdrops expire and if you sign up for earnify they'll email you anytime one of your wallets has a new airdrop for it to make sure that you never lose an airdrop ever again you can also upgrade to earnify premium to unlock access to airdrops that are beyond the

basics and are able to set reminders for more and for just under 21 a month it probably pays for itself with just one airdrop so plug in your wallets at earnify and see what you get that's e-a-r-n-i dot f i and make sure you never lose another airdrop dokwan was just arrested the Montenegro David you excited about that ladies and gentlemen we got him um we don't have much information at the time of recording but uh we did find this out in Montenegro this is a translation I believe montenegrin police

have detained a person suspected of being one of the most wanted fugitives Most Wanted wow South Korean citizen dokwan co-founder and CEO of singapore-based terraform Labs the former cryptocurrency King is that what he was who is behind losses of more than 40 billion dollars was detained the airport with falsified documents and South Korea the U.S and Singapore are demanding the same wow expanding the return of doe Quan uh interestingly enough uh we actually broke this news I

think we were the first ones on Twitter to actually break this uh so yeah dokwan arrested falsified documents uh interestingly enough if you go back in time to dokwan's Tweet back in September of 2022 one of my favorite quotes now of all time out of dokwan is uh it's not like I'm on the run or anything he said this but then dokwan tell me how why how do you have falsified documents in Montenegro interesting look at this tweet uh September 17th I am not on the run or anything similar from any

government agency that has shown interest to communicate we are in full cooperation we don't have anything to hide wow um classified passport seems like you might be on the run though uh so I'm gonna grape dance a little bit my first interaction of dokwan was telling him that I don't believe him that he was going to kill dye the stable coin uh here's Nick Kunkel a friend of mine who I used to work at maker goes how it started retweeting dokwan's by my hand thy will die and how it's going breaking don't Quan arrested in Montenegro and that's that's a wrap on that story

moving on arbitrum they uh announced a token and they launched the token yesterday tokens at the time at the time of recordings yesterday so um this just launched now I think we have some pricing information but can you recap folks on the high level what uh what about the ARB token drop it's finally here what do we got what are the stats what are the big ones okay 12.75 of the arbitrum token will be airdropped to users of arboretum yesterday today for me and Ryan uh this is the inaugural

launch of the Dow governance of arbitrum 1 and arbitrum Nova featuring on chain governance execution not just snapshot votes uh I think the maximum airdrop that you could get was 10 250 the minimum was 620 200 and 625 I think the vast majority of people got somewhere below 1 000 arbitrum tokens and of course the long tail approaches all the way to 1025. um in interestingly enough the details for there is this extra one point

something percent that was airdropped to dowels on top of arbitrum uh the biggest Dows that got the Dow airdrop were the treasure Dao ecosystem the small brains ecosystem as well as GMX uh the The Leverage trading exchange on Arbitron uh unit Swap and Sushi swap got an allocation dopex and curve got an allocation and shout out to the arbitrum team that elected to do this protocol Guild got a large distribution I think three million yeah 3 million ARB tokens uh what is public goods public goods for