ROLLUP: Trump Pump | ETH ETF Next Week | Mt. Gox & Germany | Crypto Wars 2.0

Bankless Nation is the third week of July. It's time for the Bankless Weekly Rollup. I feel like in this roll-up, David, I gotta get you up to speed because you've been out climbing mountains again, haven't you?

I feel like that's been that way for two weeks in a row. Last week I was at ETH CC, and then this week I'm just just got down from a mountain like 12 hours ago. And so these episodes are actually Ryan just gets David up to speed with

Yeah.

We got a lot to talk about, man. Uh, it was a bit political out here in crypto, David. So I gotta get you up to speed. So Trump chose a pro crypto vice president. I'm gonna give you his name, and he says he wants to, quote, beat China to crypto. Also, all of Silicon Valley is aligning behind Trump, and many in the crypto space are as well. And Vitalik gives a rare glimpse into some of his politics and his take on all this. Uh, what else we got?

the market fallout of Gox and Germany. Is it all over? Uh Gox coins are finally getting distributed to people this week. Uh what happens next? Uh and this is the last roll up before the ETH ETF gets approved. How do I know that? Because I just went and got the horcrux. Uh so this is the last time you're ever gonna hear that statement come out of this podcast. I promise.

Thanks, man. We appreciate that. So this is definitely the last

Definitely the last one. I gotta

time we've climbed a mountain to make this.

I'm bringing it back home.

Also, uh Uniswap has a big new wallet extension. We'll talk about that. And uh an update on Crypto Wars 2.0. I think this is the most important case, court case in crypto's history. Uh is the Roman Storm case, and there's been a pretty big update on the week, so we'll talk about that. But but first, politics.

Yeah, I just so I was gone for four days and so it had a great fantastic like phone uh you know social media Twitter cleanse for four days.

Yeah, that feels good.

And and then I I was able to like kind of look at look at Twitter, look at like all my feeds with fresh eyes when I came back. And it is just politics on politics. Crazy, right? On pol all like my podcast feeds, which are are both crypto and non-crypto, are podcast our politics content. Yeah. The crypto Twitter timeline feed is all politics. Granted, we just had a an attempted assassination of what might be the next president. So, like, of course, people are gonna be talking about politics. Yeah. But politics has just swarmed everything, just left and right.

Yeah, I mean you we you can't say it's not justified. This is uh pretty massive election and an assassination att okay, so where were you when you heard about this? The assassination attempt.

I was on my way out of Brussels to head to Chamani, France.

Okay.

So at the end of ETHCC.

You see it pop up on Twitter and you're like, What is going on? Was it one of those situations

Yeah.

It's like

It was right as I was about to go to bed because I was six hours ahead of uh East um yeah, United States time. And it's it's just like one of those things where like

I'm we're I was I'm already aware that we're on the craziest timeline ever. Uh and so like I guess like okay, here we go. Like there's another weird thing that's unfolding.

Can you believe how close it came? That that was crazy for me. It's like when I when I first saw the news, it just flashed and I'm like, what happened? Like, is he okay? And then fortunately, it didn't take long for me to uh like tell that he was okay. It's like, thank God. But in the aftermath of that, looking at how close we came, like an inch, a tilt of the head away, like the wind blowing in it in a like a different way in a different direction, would have been a completely different outcome. And I just feel like, what what timeline are we living in here? Like this is, I mean, could have been completely different roll up today, could have been a completely different country, could have been a completely different reality.

Yeah, there's something, there's some like reference to like Schrdinger here, where just like we're we have chosen a particular fork of the universe. And it was very clearly like a cho a choice that happened. Apparently, we're in the universe in which uh Trump gets a clip off of his ear and crypto prices start like rocketing. Like I remember like just noticing the like watching the videos, going through the Twitter feeds, looking at the Trump assassination, and then looking at the crypto prices, which all like immediately jumped like two, three, four percent, which but it was very noticeable, like right after the failed assassination, crypto markets pump. And the stock market was closed, if I'm if I'm remembering correctly. Uh and it was just like such a such a strong like correlation of just failed assassination, crypto prices pump.

Can you imagine? So uh assassination attempt is that would be absolutely horrible. I imagine the markets would go in the other direction, probably amplified by like a massive amount, because just like a massive amount of uncertainty. So that happened Saturday, David. Uh Trump didn't get assassinated. And then I believe this was Monday, he announced his vice president pick, a gentleman by the name of Senator J.D. Vance. This is uh his post. After lengthy deliberation thought, considering the tremendous talents of others, I've decided that the best person suited to assume the uh president of VP of the United States is Senator JD Vance. So the question is who is JD Vance? You did some research on this while you're while you're out, yeah?

Yeah, yeah. Well, I was I was actually like prepping for the joke. And since I'm six hours ahead of you, I actually had like I actually did have time to actually catch up on the news. Uh people might know this book, Hillbilly Elegy, uh, which was a big book that kind of catalyzed a lot of the populist sentiment right before the 2016 election. Uh, this it's this book uh that is set in this like uh in the Appalachian about this highly educated Appalachian uh lawyer. And Appalachia is known to be not educated for it. And it was kind of like um uh a rallying cry for a lot of conserv of the conservative right, of the lower class conservative right that ended up uh just uh it put a um uh a lot of uh uh sentiment into words about the right's feelings towards the social elite and the coastal elite. Uh and so this was a kind of an influential book that helped catalyze what came what came to be a very populist uh ran election. Like even Bernie Sanders, a populist president, was uh still very, very relevant back then. Uh and so uh JD Vance is the author of Hillbilly Elegy. He is also a Republican senator. Uh and and so it's this uh it's kind of an interesting pairing where you have Trump, the media man, with this Republican U.S. senator who wrote this book, who is like also understands like culture and media, uh, and is it's another step away from just like the traditional like lifetime politician. Uh interestingly, as it relates to crypto, JD Vance has previously drafted a bill that would completely overhaul the SEC and the CFTC's stance on crypto. So this is a this is a populist right wing senator.

Who has explicitly made pro-crypto crypto legislation and try to get it pushed through Congress? Uh, and so this, in addition to the uh sentiment that the markets felt positively towards the failed assassination attempt, which I think markets are just pricing as like, oh, the failed assassinate and the assassination attempt is probably gonna like lock in the Trump election. So that was bullish. And then on Monday, we get this JD Vant uh guy who's gonna be pr Trump's uh vice president, who is explicitly very pro crypto and has tried to push through positive pro crypto legislation. So we get this like one two punch in like the positive direction.

Yeah, so JD Vance is very pro-crypto. Actually, I was on with um representative uh French Hill, who you just mentioned JD Vance in passing. I asked him about him, and apparently J.D. Vance may be taking the lead on some legislation. You remember Fit 21 that was going to the Senate? JD Vance is the Senate. He may be catching the ball right now and actually working on his version of legislation of Fit 21. So I don't know all the details yet, but um Representative Hill mentioned this in passing. We do know a few other things. So he's young, uh uh, particularly for a US politician and and senator in in these times. So he's like 39 years old. So he's a millennial generation, and that's interesting. He also has voted for the SAB 121 repeal, uh, as you can imagine. He's a crypto holder. So as of 2022, he owned at least $250,000 worth of Bitcoin, likely has more now. He slammed Gary Gensler in open letters. We have a clip we're gonna play coming up. It's basically further evidence that he is a um a pro crypto candidate and that the Trump White House will be pro crypto, right? And this this he gets an A on standwith crypto, uh the standwithcrypto.org website.

I think the big question right now is uh is this JD Vance selection as Trump's vice president? Is it the fact that he is pro-crypto? Is that a coincidence? Or was that like an explicit influence in Trump's uh selection of him as well? Uh and I'm kind of thinking it might be the latter. Uh I'm gonna we're gonna um I'm gonna go ask uh David Bailey, uh, who is uh the founder, operator, owner of um Bitcoin Media, Bitcoin magazine, who is the policy advisor to Trump. Who's the he's the guy like kind of steering the ship in terms of like Trump's crypto policy? Uh so I'm gonna see if we can get him on the podcast and get his perspective.

I think you sort of like have to broaden it too. So I I also didn't mention he's a a VC under the like Silicon Valley VC under the tutelage of of Peter Teal. I don't know if you saw that th this morning as well.

Conservative pro Trump.

There's like a tech play here, which is very interesting, right? And we'll talk about that a little bit later. Silicon Valley has really rant rallied around uh Trump in in the past week. And I think JD Vance is uh all part of that. So that's JD Vance. This is him. Maybe we should play a a clip surfaced by Crypto Twitter of previous statements of uh Senator Vance. He's actually talking about Gary Gensler and Crypto Twitter surfaced this. I think it's pretty interesting.

If there's a candidate for worse person, in my view, at least in terms of my substantive disagreements, I'm sure he's like a nice guy,

uh, is Gary Ginsler. Okay. So Gary Ginsler is sort of the complete opposite of my view. And there are two problems that I have with Gary. Uh, one of which is that I think he wants to inject politics way too much into the actual business of securities in the United States of America. But uh the the, in some ways, the more fundamental issue, or at least the most relevant issue for this particular conference, is you know, the approach that Gary has taken to regulating blockchain and crypto uh seems to be almost the exact opposite of what it should be.

Uh uh you know, and I'm oversimplifying a little bit, but the question the SEC seems to ask in regulating crypto is, is this a token with utility? And if it's a question, if it's a token with utility, then they seem to want to ban it. And if it's token without utility, they don't seem to care.

I almost think we should be the opposite here, right? I worry about financialization. I worry about, frankly, whether a lot of the crypto stuff is fundamentally fake. But if a token actually has utility, that's the sort of thing that, you know, by all means, regulate it, by all means be careful about how consumers interact with it. But you don't want to just get rid of this stuff. And here's where I really, really worry about this is a lot of the newest challengers to social media, the social media incumbents of 2024 are going to require

So he seems to be opening the door for tokens that do more than just represent memes, like tokens with cash flows, tokens that are real, and opening the door to that.

Yeah, and uh expressing a pretty like deep knowledge about what's going on in the industry, like beyond just like oh, money on the internet. Like he's talking about like he's alluding to like social platforms and you know underlying blockchain technology beyond just like sending tokens around.

Another win for crypto uh related to politics was an actual app. You know, people say, Where are the apps? Here's an app that works. It's called Poly Market. Okay. And the great thing about Polymarket is a prediction market, it actually predicted that JD Vance, it was the best predictor that JD Vance was going to be Trump's VD uh VP pick of any prediction market. It was the most accurate and it reflected the probability, like you saw it spiking up right before the announcement to like 70% odds. And uh, if you go to the poly market um page right now, it is doing a fantastic job predicting some of these political outcomes. I even heard on the

Relevant. It's just extremely relevant.

Yeah, and and it's getting meant starting to get mentioned, referenced in in mainstream. I even heard Sam Harris podcast mentioned prediction markets as like like you know, just in the context of what's gonna happen, is Biden going to drop out? Well, right now, Polymarket says there is a 76% chance that Biden drops out. And given

there's given it given it its previous performance, right? I actually rate that as probably pretty accurate with with respect to probability. So this is particularly with these political decisions.

Well I don't think you know more than Polymarket, Ryan.

I don't. Nobody does. Right. But like that's the beauty of it. That's what prediction markets uh should do. And uh like it's a just a great use case for for crypto here.

It is very refreshing seeing Polymarket either explicitly or implicitly alluded to like uh on all of my non-crypto media feeds, like prediction markets are being referenced. And I know they're all talking about polymarket because I can go and like uh reference the numbers, but also because polymarket has like 85% of all market share of all uh prediction market volume. Uh and so this is like where liquidity and accuracy are actually intersecting. Uh, and liquidity kind of actually matters in like what is more of a like a downstream market uh to place bets on is like who's Trump's vice president gonna be. There's at least four more markets, five more markets that are ahead of that. Anyways, on other things that are about politics and also bullish crypto, Donald Trump is apparently considering Jamie Diamond as Treasury Secretary. And not just that, but I will also add that a Forbes headline reads Trump reveals JP Morgan CEO's sudden Bitcoin and crypto flip. And I want to emphasize Donald Trump is saying that Jamie Diamond is now bullish crypto. Like the fact that Donald is the the harbinger of this message is is crazy.

Right. I mean, what what happened, I'm sure, was like, hey, you want the job, uh, Treasury Secretary? You you gotta be pro-crypto, you gotta be pro uh pro Bitcoin. This is like part of the criteria. 110%. Really? And it's just like not hard for Jamie Diamond to flip. I mean, Larry Fink uh like admits it he flipped on on crypto as well. Like at first he hated it and then he flipped flipped on it because he did more investigation, had some products to sell. I mean, this is exactly what's going on. When it's opportunistic, Wall Street will kind of like flip towards crypto, and this is what we're seeing here. Also, this week, uh, Trump says he wants the US in charge of crypto before China. It's a uh uh a crypto race, I suppose. He said, if I throw it aside, it's gonna be picked up by another country, most likely China. They're pretty advanced in this sphere. So you have to look at it. What I want again is uh what is good for the country. And so he again, he's talking, but he's putting crypto in the geopolitical context and said, This is another reason for why he is pro crypto and wants to foster innovation here.

I think Trump's pro crypto stance and other things is as well as the nomination of uh JD Vance's uh vice president has really kind of won him a lot of hearts and minds. Uh, it's been sl slowly crescendoing in the last like month or so, but I think in the last week, as and especially since the assassination assassination attempt, just like so many tech giants have just lined up behind the Trump administration. Mark Andreessen and Ben Horowitz came out as pro-Trump, Brian Armstrong, Elon Musk, the Winklevi, Kathy Woods, Jesse Powell, Eric Torenberg. Like Silicon Valley is just like lining up behind Trump, which is fun kind of funny because Silicon Valley, once upon a time, used to be a pretty like liberal bastion. Uh but now they're all kind of like a seeing that like Trump is just pro innovation and pro markets, and they're all kind of like lining up.

That's it. You know how we've said about the Democrat uh platform with respect to crypto. It's just they're they're leaving free real estate open, right? That's exactly what they're doing with crypto, and the Republicans are taking it, and Trump's taking it. But more broadly, they're leaving free real estate open when it when it comes to tech, big tech, AI, this sort of thing. They don't have a strong platform. And Trump is saying, hey, I'm the uh pro-tech, pro-crypto, pro whatever you want me to be, pro markets uh president, right? And so they're like lining up behind them. There is a uh podcast, I haven't listened to it yet, but um, you know, Mark Andreessen, Ben Horowitz on just like why they're supporting Trump, basically. It's still in my cue to read, but like all of Silicon Valley is kind of lining up behind this candidate. Now, there is a counter to all of this, and there's another discussion at play in crypto. So, David, you might have been seeing a lot of pro Trump takes in the crypto sphere for sure, but there was uh another take with a bit more nuance, you know, a Vitalik style take. In fact, Vitalik wrote a blog by the man titled, Yeah, Against Choosing Your Political Alliance Based on Who is quote unquote pro crypto. Did you read this article? Did you get the gist of what he's saying?

Yeah, it's actually the first thing I I read this morning. Uh, and the way I would just summarize this is that Vitalik is advocating for a notion of crypto values or crypto politics in of themselves, cyberpunk values. And he said he's saying instead of simply supporting pro or anti-cryptocurrency politics, we should instead view politics from a crypto ethos and decide on the merits of candidates based on their alignment with the values that crypto as an industry tries to enshrine. Uh, you know, freedom, uh, censorship resistance, uh, the ability to uh express freedom of speech and freedom of uh to transact. Uh and so he's like kind of differentiating just like politics and policies that will like make more tokens legal and allow more ETFs to happen and do things that are good for our bags, and like kind of reminding, like, why are we here in crypto in the first place? Like, why do we value censorship resistant uh technologies? Uh, what about like other facets of crypto that aren't cryptocurrency but cryptography? And he's basically saying, like, hey, let's kind of uh view these candidates as like who they are as humans rather than the policies and uh the things that they are trying to promote and judge some on their character, which I thought was like refreshing, uh, but also needed further unpacking, which is kind of what crypto Twitter did.

Yeah, it does need further unpacking. But it's interesting the way he opened this article was uh a picture of him with Vladimir Putin in uh 2018. And I I I think I recall him saying he actually regrets this meeting. He's uh sort of felt sort of used. Uh says at the time, many in the Russian government expressed willingness to become open to crypto. And then it turned out they really weren't. Like it turned out Russia was maybe open to it from a government perspective to evade sanctions. Exactly. But they weren't open to it to give like crypto freedoms to their citizens.

People, yeah. It wasn't Russia's not pro crypto for the people, it's pro crypto for the oligarchs.

Exactly. And so that that, you know, uh I think Vitalik is citing that as an example of a disalignment here where somebody could have a stand with crypto binary. Yep, they're an A plus because they like fit, you know, um 21. But really behind the scenes, they maybe they disapprove of uh privacy on chain. Maybe they don't actually support a custody. They they uh you know self custody of assets, maybe they don't support the other like freedoms associated with crypto.

Things like imag you can imagine, like you can own Bitcoin in the ETF, but not with a private like a policy like that.

Oh, and could you imagine Jamie Diamond being pretty excited about Jamie Dominic?

Love that.

I mean, that's so so there's a lot of nuance when it comes to uh pro-crypto. This is the way I've I've kind of stated it because David, you you noticed we've had to make some decisions on on bankless uh lately with respect to what guests we have on the on the program, right? And so we've been having Republican guests, we've had Democrat uh guests uh in the past. So the question is like, should we have someone like JD Vance on the podcast? Should we have someone like even Trump on the podcast? And I think our our platform has always been like, we're open to uh any guest, regardless of party, that wants to talk about crypto so we can hear their stance. So I kind of articulated this. I want to see if you agree with this. This is just like not the bankless editorial policy, but it's kind of like my personal editorial policy because I felt like people people would say, Oh, you like they want you to pick a side team red, team blue, you gotta pick a side, right? Of course.

And even even pro crypto people, there's like Republicans are clearly pro crypto, so

Yeah, why why David Ryan, why aren't you guys the on like voting on the Republican administration? They're the pro clearly the pro crypto ones.

Yeah, yeah. And uh first of all, I don't I just like don't wanna disclose who I'm voting for. Like I don't feel like uh people come to uh bankless for p uh political insights. So this is kind of

This is kind of how I've articulated it, and I want to see how far off or close this is to you. But my lane is pro-crypto and anti-authoritarian. I'm not a single-issue voter, personally, though I understand people who are. I support pro-crypto policy from both political parties and at Bankless, give voice so the voters can hear transparently where the politicians land. I avoid dishing strong opinions on areas I have limited expertise. My deep wish for America is that it avoids 21st century trap of authoritarianism. And my contribution to this task is propagating crypto and in doing so restore some power to the people.