CD81: shitcoin apocalypse, macro environment, self custody all time high, bitcoin fundamentals with @DylanLeClair_ and @_Checkmatey_

Happy Bitcoin Tuesdays,

freaks.

It's your boy Odell here for another Ciel Dispatch

show

interactive live show

focused on actionable discussion around Bitcoin and Freedom Tech.

As always, I want to thank the supporters of our show. Our show has dispatch has no ads, no sponsors,

and is funded by our audience through Bitcoin donations.

Could not do without you guys. I really do appreciate all the support.

The easiest way to support the show is through podcasting 2 point o apps, such as fountain podcasts,

Breeze,

echo l n. I believe you can go to new podcast apps.com,

and they have a list of different podcasting apps that support it. They work like regular podcasting apps. You install the app, you search Siddle Dispatch, you press the subscribe button, and then you can choose

how many sats per minute you think the show is worth, and they would get streamed directly to

my note as you listen.

It's really fucking powerful seeing the sats stream in minute by minute.

Recently,

I set up

something called

geyser dot fund,

which acts as a transparent

leaderboard

for podcasting 2.0 and just audience funding in general. If you're not using a podcasting 2.0 app, you can also search Ciddle dispatch in your favorite podcast app, YouTube, Twitch,

Rumble, Bitcoin TV.

We stream to Twitter,

and

they all show up

on

on geyser.fund.

So I set up a

redirect.

If you go to satspermitdot

com or satsfundme.com,

you can see that.

I'm just gonna pull it up on my screen really quickly,

for the people watching through video.

This is what it looks like.

And as you can see,

there is

a live view

of how many sats are getting contributed to the show. We're trying to do some radical transparency here. It's refreshing.

So just give it a minute.

But these all go directly to my notes, so it's self custody. We're not trusting Geyser custody. They're just showing

all of the different sats as they come in. If you're using Fountain, it'll show your Fountain username.

They have a live leaderboard

that shows

people over time

different freaks out there, how much sats they've supported.

So the leaderboard is really fucking cool to see.

And if you're not using a podcasting 2.0 app, you can just press this contribute button, choose how much you wanna contribute,

and you can leave a message if you wanna leave a message. You can drop a gift,

and then you can donate either through lightning

or

On Chain. So once again, I appreciate all your support.

I,

it's really powerful, a lot of people think value for value can't work. A lot of people think the ad model is the only way. I think,

I think we can prove them wrong, and we're gonna keep keep doing these dispatches,

and, keep relying on all your support. So thank you to all the freaks who continue to support.

With all that said,

let me bring us back to the mempool page

with the live chat.

Every week, I read out supporters.

Well, now everyone can see them on that geyser.fund

page. Right? So,

this week, instead of just 4, I decided

to highlight 21 of them.

Let me just pull this up real quick.

To all the freaks that are also watching the men's World Cup game,

USA is up 10. Let's fucking go.

Let's see. I'm gonna hide this. So these are these are some

contributions that we've gotten this week.

We have our largest single donation that

that,

Ciel Dispatch has received through podcasting 2.0,

which is from Quinn Solo, ride or die freak, who created some awesome

he has all these different

customized leather,

items that you can buy with Bitcoin,

including a dispatch,

flask that I use. And he said circular economy for the wind, stacking stats with quince solo.com since 2017.

Love you, Odell. Thanks for keeping us grounded. Stay humble, and don't leave us too soon. He gave 900,000

stats.

We have an anonymous funder that said, Sergei always has a sobering

perspective. Awesome stuff. Keep pushing out episodes that focus on building Bitcoin businesses and using the tools IRL.

Coincards has great uses stats this month over month as well that people can look at.

We have an anonymous funder that only contributed

1800 sats,

but his message was, Odell, if you can read this, I am wrong. I doubt I am wrong. You are wrong, sir. I can read this and so can everybody else on the geyser dot fund page.

We have another guy with 500,000

sats, anonymous funder, Odell, long time fan, first time donor. Appreciate you, brother. I've avoided losing my sats. Thanks to you. Here's a toast for you onboarding the next wave of Bitcoiners.

604,000

sats from a different anonymous funder taught me most of what I know, kept me on straight and narrow path. Humble sad stacker.

PS, someday I will get a CD hat.

If you go to mattodel.com,

all my,

contact information's there, and we can coordinate you buying a dispatch hat if you message me on one of those platforms.

What else do we have here? We have

at dude on fountain podcast

explaining to me that if you boost from other apps, you cannot see it on fountain,

and that he sent his money to fountain just to post that boostagram,

45,000

sats. From now on, I've learned

that Fountain will show the boostagrams because I've put them into a 1% cut in the split. So when you stream SaaS to the show, not only do they come to supporting the show, they also support open source projects like Sparrow Wallet, Zeus Wallet, Seed Signer. Really cool. Like, Azure streaming SaaS. Literally, I don't take custody. They come to me. We may also go to these open source projects. Well, now 1% also goes to Fountain.

So if you're a Fountain podcast user, you'll see boosts

from all of the

different

podcasting 2 point o apps. Previously, because I wasn't using their custodial wallet and I was using my own node, you couldn't see that.

I'm not gonna read all of these because it's too much. What there was another one

that was really big here. Dispatch saved me from Celsius, BlockFi, and FTX. I will forever be grateful. 150,000 sats.

Love to hear that. Really does make it all worth it. But, anyway, freaks, once again, you can go to satsperminute.com,

and you can see a live look

of all of the different supporters, a leaderboard.

Let's

I just appreciate you all, so thank you.

I know that was a long running intro, but the geyser dot fun stuff is just really cool, and it's awesome to see the support. Also, you guys got got dispatched to the top of the podcast hot charts

on fountain podcast, which means it was streamed

the most sats through fountain.

Just to be clear, it's come to my attention that that's not, like, an overall podcasting 2 point o leaderboard. That's only for fountain users,

but, it's still great to see.

Last but not least, thanks to the freaks who continue to join us

in the live chat. You guys make this show unique. We have the matrix chat. We have the YouTube chat. We have the Twitch chat. It's all streamed directly into the show,

live, unedited,

not moderated except for whatever algorithmic bullshit that YouTube and Twitter Twitch are doing.

So with all that said, I have a great

2 guests here.

We're gonna be talking about a wide ranging of topics,

including the macro environment, just the current state of Bitcoin fundamentals, self custody all time high, and the shitcoinapocalypse.

To start us off, we have Dylan LeClaire,

long time freak,

first time guest, good friend. How's it going, Dylan?

What's up, Matt? Check. Excited for this one. It's gonna be a

good rip. We have a we have a lot to talk about, I I think.

And that, you know, it's been a it's been

a vindicating even though even though it's been, you know, somewhat of a

a shit month for the Bitcoin exchange rate. It's been, a vindicating one for, from from the maximalist perspective,

and you've been you know, you,

your podcast with Marty, just a lot of the things that you've been hammering home over the last

last 2 I mean, for me, 2 years is as as long as I've been listening, but, you've been, you know, hammering these points so much longer,

and, you know, have been proven right about a lot of things. So,

yeah, I'm just ex excited to rip with you on it.

Fuck. Yeah. Well, it's great to finally have you on the show. It's been a long time in the making. And we have

friend of the show as well, Checkmate, over here. How's it going, Checkmate?

Good day, folks. Great to be here, mate. And, as Dylan mentioned, the thing I'm certainly looking forward to is a spot driven market. Right? We've seen

all the leverage get purged and, the free market do its thing. And now that we're sitting in the embers of this forest fire, it's, it's good to kinda come back and assess what's happened and, try and chart a path forward, which is always good fun, but thanks for having me on.

Cheers to that.

So maybe we should, you know, dispatch is a a wide open discussion show,

but maybe we should start with that. Let's start with,

I mean, my so

Checkmate

is what we would call a

a good guy chain analysis guy. He's not in the chain surveillance business,

but he works for Glassnode

that analyzes on chain transparent data.

So he's not actually trying to surveil individual users. He's trying to, like, take metrics out from the chain data.

And I was talking to Checkmate the other day, and we were talking about self custody.

And I'm

I'm pretty sure that self custody right now is at an all time high. Bitcoiners holding their own keys and holding their own Bitcoin is at an all time high. And I would go as far as saying that if you don't hold your own keys, you're not a Bitcoiner.

So right now, in the history of Bitcoin, we have the most Bitcoiners that we've ever had.

Would you agree with that, checkmate?

Yeah. So, if you if you kinda look and look, there's a lot of metrics. And as you mentioned,

certainly what we're doing is not tracking individuals. We look at, I think the best way to think about on channel analytics is we're, we're economists, and, I like to take it one step further and say behavioral economists. We're looking at how Bitcoin is,

using Bitcoin, right, on on scale and it's, in mass.

And, what we're what we're basically seeing

is in the in the wake of FTX, and I mean, it's obviously been, almost 2 weeks now or 2 and a bit weeks,

we are continuing to see pretty much every been 2 weeks?

It's wild. Yeah. I think so. I mean, what was the

3. Class on the 8th. 3. 3. I mean, there there you go. Right? Life in this space. I think so I normally measure from the 6th November. That's kind of the baseline

pre FTX,

and then the largest,

we've seen lots of activity. You know, you you tend to see a peak somewhere.

Right? Peak fear, peak realized loss. That was somewhere around 16th to 18th. So that was kind of the the timeline, and here we are at the back end of the month.

But, anyway, on, on self custody.

So,

you know, 3 weeks later, we are still seeing

the outflow of exchanges.

It's it's an all time high, record high. So if we look at it in terms of a monthly flow, we do this a lot at Glassnode, you'll see it called net position change. What we're looking at is a 30 day change. Right? How was a particular metric change over the course of the last month? And, what we're seeing is, I think, it's about a 180,000

BTC per month flowing out. Right now, we're 3 weeks in. Right? That multiply that by, you know, 3 quarters of a month. It's a, it's a significant sum,

and it's it's quite interesting because it's going into the hands of pretty much all wallet cohorts.

So when we're looking at all the, the economic data on chain, you know, we can break down different wallet cohorts. We can see shrimp. We can see crabs and, you know, there's all sorts of sea creatures we can kinda break it down into.

The only cohort that's not participating

to a significant extent

is whales, and these are 1,000 BTC plus.

Now they're not exactly

they're they're in this very interesting regime where their balance is already very high. Right? They have, like, 6,000,000 BTC in total,

and they've deposited something like 6,000 on net. So they're on net sending coins into exchanges, but 6,000 BTC

is

over a 30 day period is very, very small relative to their holdings. So,

whales are the ones that I would argue

effectively flat.

Pretty much every single other wallet cohort,

all the way up to that 1,000 BTC level is, if not all time high,

multiyear high in terms of the amount that their balances are increasing.

So there's no question that there's been a, a significant spooking

of, of the market, and look, this self custody almost gonna have a few few different roles. Right? Some people are taking it out because they're like, which one of these casinos goes down next?

There's other ones where there's gonna be Bitcoiners who were just taught the very hard lesson of,

either experiencing loss or seeing loss at a mass scale,

and are finally doing that that, you know, record, take my coins off exchanges now I'm on chain. And, you know, you can back this up with other anecdotal data like Ledger and Trezza are saying they had all time high sales. I'm sure that,

Resolve would say the same thing. Exactly.

So, you know, I I when I look at that whole spread of information, 88% of the supply is now off exchanges. It's the largest we've seen since December 2017.

And the way I look at that, every coin that's flowed into an exchange since the since the December 2017 top is now in some guy's wallet, which love to see

it. And the USA just scored their second goal.

So Let's go. When when we're thinking about December 2017 was the last time we were at this exchange level?

Yeah. On a, so not on a per coin basis. I like to look at it. It's actually better than that. I like to look at it on a, percent of supply. So as you can imagine, over the last 5 years, there's been a whole bunch of coins mined. So all of those as well have also either not flowed into exchanges or flowed in then flowed out.

Interesting.

What do you think about

okay. So, I mean, let's let's go on this this tangent for a little bit. So, Dylan, like, you've been talking a lot about,

the exchange flows out. I mean, anecdotally, I I've had so many people finally reach out to me about self custody.

I mean, I posted on Twitter today. I, like, personally set up people, like, 2020 different people with,

cold cards and self custody for the first time. I mean, I think this is

a bigger learning experience for people than every podcast,

video, YouTube video, book combined. Like, this some people just have to touch the stove. They learn their lesson. A lot of people trusted FTX. It was one of,

you know, they had a Super Bowl ad.

A shit ton of people got burned on BlockFi. Even more like, I have so many friends that got burned on Gemini Earn,

ironically enough. I mean, I just feel like that was considered, like, a very quietly trusted one.

So no custodian is safe. They've never been safe, but people are finally coming to terms with that.

So, I mean, Dylan, you've been posting a lot. You, like, kinda stepped away from the on chain stuff even though you were more focused on the on chain, like, a year ago, maybe a year and a half ago. But you've been posting a lot about the exchange outflows.

What are like, what are you thinking from that perspective?

Well, yeah. I mean, I I think,

more so, I I just,

kind of as a as a market analyst, I like to to weigh a a few different things and,

like, say, go back to the top of the market last year. The the interesting dichotomy was that there was, like, from a, like, a huddling standpoint, you had you had a really, really strong like, on the on the second leg of that double bubble almost.

You had not almost. We made a new high 69 k.

It was it was really interesting because you saw, like, you know, there were certain things like long term holders or, you know, supply held for x y z amount of time. That was, like, pushing new highs. Right? And from, like, a like, Bitcoin is obviously absolutely scarce in the supply

inelasticity

of it.

I guess the one thing that not the one thing, but one of the things that I I waited a little bit wrong was the supply and elasticity cuts both ways.

And so, you know, if there's if the marginal seller is strong because

of whether it's macro fears or because they're a forced seller or whatnot, you can have 80%, 85% of the float that's not moving, not selling, not doing anything, and and the price can fall. So that's what we've seen, I think, so far.

As a result of FTX, as as you guys have both said, there's been a a mass outflow,

from exchanges, and I think that's good. Honestly, I think what what we need to do here and what what will eventually happen I mean, what's happening right now as we speak,

is is you're pulling all of this all of this supply off exchanges.

Bitcoin always bottoms, and and, really, any any asset bottoms, but,

Bitcoin bottoms when the marginal seller is is exhausted.

And for an absolutely scarce asset,

that can be, you know, withdrawn to custody as long as as exchange isn't fraudulent or, you know, locks you in,

in in, you know, 10 minutes, right, in in in a verifiable manner.

This is this is the difference between Bitcoin and gold. Right? It's like, how does Bitcoin like, people you often see the macro people or the, you know, the old boomers who are dismissive of Bitcoin. They say, you know, it's gonna suffer the same fate as gold.

And and the reality of what's happening, and it's and it's sort of ironic or or paradoxical in a way that what what we've done over the last 6 months with Bitcoin's exchange rate plummeting by

60%

is we've just smashed all this paper Bitcoin. We've just just

like, you know, imploded it. It's just gone into oblivion. Right? And at the same time, the the the the pre float supply is more constrained than ever.

So I think I think that's what we're doing. We're finding you know, we're gonna whether it's here or lower or, you know, if the bottom's in, I mean, I don't know. But Well, I mentioned

called the bottom at 155 last week. It. Love it. Yeah. I mean, I It was looks like trading at a 155. I was asked to call the bottom. We all under the heart about it, but,

it it has to be it.

Yeah. I I mean, I freaking hope so.

You know?

Like, you know, we'll see if, if there's any more freaking fraud under the surface. I think for the most part, we've got this leverage,

wiped out.

Whether another risk on way risk off way it happens in legacy, we'll see. But in terms of, like, the amount of fore selling that we've seen over the last 6 months, it's it's been massive, right, where all these Ponzi's imploding.

And and, you know, the shitcoin like, the the only reason I pay attention to shitcoins, like, I posted, you know, about FTT or Luna or all this this garbage. Right? Like, I I have no interest in in buying this stuff. The only reason I watch it is because as, like, someone that's interested in in the Bitcoin market is because the whole the whole space is cross collateralized for better or worse.

So, you know, we're gonna implode all this garbage. Yeah.

And and, you know, Bitcoin, what what what is that? 15 k. It's, like, what? Like, 75% from the from the highest? 80%, something like that?

I mean, certainly, like, the macro isn't isn't all that conducive.

Right? But but at some point, and I think it's probably pretty damn close to here, the amount of price agnostic accumulators of Bitcoin is enough to stave off any

and and and all marginal selling pressure.

And then, you know, we're we're we're gonna have a scenario where, you know, the the people shorting on Binance and the and the boomers that are on CME

or buying or or, you know, buying the short ETF or, you know, shorting like BITO. Right?

These guys are gonna get smoked,

like, Bitcoin,

open interest on CME is at an all time low. The the basis, like, Bitcoin's price on CME versus, like, the spot market rate is at an all time low. It's it's it's on it's never been it's never been lowered. It's never been more negative. So at some point, these guys all get their face ripped off,

and I think that's that's really, really exciting. Like, we're we're setting up here, and I think we have some time to chop around.

But, you know, supply accumulation,

these guys shorting with fiat denominated

collateral.

Right? Like, we we've seen this story play out before.

And and, you know, the funny thing is everyone thinks in the mainstream that Bitcoin is dead.

Well, I mean, like, let's unpack this for a little bit because

I mean, this has been my thesis for a while, which is that Bitcoin is not immune from paper Bitcoin like we've had with paper gold.

But pretty much as long as

there's a convicted base

of Bitcoin

stackers,

Sat stackers, if you will, that are stacking sats, not IOUs, and actually withdrawing it to their own

wallet. Anyone who plays these games will get wrecked eventually. And we I mean, we saw with FTX. FTX,

how much in Bitcoin liabilities? Like, 1,400,000,000

in Bitcoin liabilities, and they had nothing on their they they owe no Bitcoin.

I think I think they,

they probably well, maybe not sold at all, but they were,

I don't know. I I don't think, like check. Do you think they were running a Bitcoin deficit for a while, or do you think it was in the last hour when they were trying to prop up FTT

that they sold it all and you also had a bank run at the same time?

Hard to tell, but, my my view on the a lot of this thing is when you start looking at their let me if you look just their exchange balance, so for better context,

FTX,

this is coming from my our data team. So the way that we track exchanges, we've got a suite of or or a team of very experienced data scientists.

They observe how wallets

behave. Right? How does Coinbase manage their wallet? How does FTX manage their wallet? And that may sound easy, but I assure you it's not this. They're always changing the way that they do it.

How do you know that a call a cold wallet or a hot wallet is Coinbase finance until it interacts with another set that you know is Coinbase or finance,

and they've always got multiple of these things running around. Anyway, FTX was, one of the hardest.

Coinbase is also very difficult to track, but, FTX was one of the absolute hardest to to track. They had some very strange peeling chain behaviors, all this kind of stuff.

Now when you when I go back and this is the thing. Right? There's there's lots of stuff that you kinda notice in hindsight,

but also I wasn't, you know, in the business of looking for fraud at that point in time. But, the more time you kind of where as information comes to light, you start looking at the, FTX exchange balances for this is what I found quite interesting.

For BTC and ETH, right, if you look at both of those

in,

May when Luna collapsed,

what what what we saw is, I think it was, like, a 52%

drop in their overall exchange balances. It was either, when Luna collapsed in May or, or the sell off down below 20 k, when all the other lenders blew up in June. So somewhere in there, their exchange balances of BTC and ETH went down 50%.

I think it was something on the order about $2,000,000,000

worth or thereabouts.

And at the same time, the stable coin balances on FTX

increased by about 900,000,000,

I think it was.

So what was that? Was that a bunch of coins, customer coins that got sent to somewhere to borrow stables to then go and prop up some of these things?

It is hard to tell and, like, there's gonna be a whole lot of forensics that will take, I would say, years to actually fully unpick what the hell happened.

But my

based on what I've seen, it looks like they probably blew up back then in in May June.

3 arrows. I mean, this is the thing. Right? So when when we kinda look at what's still left to burn in terms of liquidations and forced sellers and that kind of thing, And again, we don't know what the future holds and DCG is obviously a, another catalyst. It could be be more that follows after that if that goes pear shaped.

But if we think about what happened in

June, every single lender who was gonna blow up at that point in time did. They were then saved, in inverted commas, by FTX,

and FTX then blew up, you know, 6 months later.

But, essentially, we'd already seen what the impact was gonna look like. If FTX didn't step in, we already had a pretty good flavor of what was about to happen. So in many ways, FTX should have been the start of this whole,

implosion,

through a series of unfortunate events turned out being the tail end of it, but I do think it's the tail end of it. Right? I think we've seen a vast majority of the damage,

in terms of, like, who, which entities were left to go. I mean, BlockFi

yesterday, I think it was, did bankruptcy,

and I don't think anyone was surprised. Right? This is not new new information or new news. This was, you know, pretty pretty priced in, and I think the market literally didn't move. So we're getting to the point now where most of the information is known in my view.

Again, there could be still be some skeletons out there, but I think that, we've now had 6, 7 months almost

for those skeletons to to come and and surface.

And, FTX was certainly the one that surprised everyone,

because of its magnitude, but it looks like they were up to no good from from June onwards. But to be perfectly honest,

the thing that I always found very bizarre is that FTX's exchange balances were never large enough

to oh, that that said, I mean, me as a as an Australian, there's very little time that I spend kind of understanding

what f like, FTX's role, and like many people, it just kinda came out of nowhere. And I think there was a lot of US folks,

trading on it, and I hear a lot of institutions. Right? Which is a really interesting dynamic because,

it to me, FTX, there's some there was just something about that never quite worked for me. I hated the UX, and there's a lot of reasons why I personally didn't use it.

But I was surprised

by how small their balance was

relative to what their perceived

size of the exchange was, which obviously turns out to be very large.

And, when I kinda go back and look at that, initially, I was like, well, you know, I I keep hearing these stories that it's really hard to track these wallets, and no one's been able to find their cold wallets and they have lots of interesting, like,

obfuscation

techniques,

which I guess you could argue in from one angle is a competitive edge. Right? You don't want Binance knowing what your wallets are because that gives him some kind of edge over you,

but you also would do that if you're a criminal. Right? So these 2 sit side by side.

You don't know which one it is,

before the event.

But, you know,

the the strange wallet practices make a whole lot of sense now, and this was always the case. So, you know, these these kind of things where you gotta look for smoke at all times.

I mean, the TLDR is they were probably running a fraction reserve the whole time or at least I think that's the case.

Or if they were fully reserved, it was because of shit coins that were at ridiculous valuations that they hold the majority of.

And then you all I mean, even just you've just like you've seen the,

the the,

talk about these financial transactions. Right? People are sending and wiring money

to Alameda,

which then gets deposited to their account at FTX.

Like, that there, that's, I mean, that's a fiat problem.

That's that's basically showing that that these 2 were just inter interlinked to the whole the whole,

the whole stay, which, you know, having a hedge fund being a depositor for an exchange is just wild.

It's really interesting. We did a deep dive on this.

Excuse me. We did a deep dive on this for, Bitcoin Magazine Pro. We just kinda released it, like, detailing,

you know, the FTX rise and and collapse.

And if you guys remember during the bull market, you had, like, the, you know, the quote, unquote, Sam coins, right, which all pumped super, super hard.

And these were Massive

and shit. Right? Oh my god. It is it is literally such a a massive joke.

These guys,

they spun up worthless like, maps,

which I forget the the the fully diluted valuation at the top. It was something like tens of 1,000,000,000 of dollars.

These market caps, MAPS and Oxy, had fully diluted market cap. So, like, the the circulating supply of these tokens that that's not yet, you know, the total amount that will ever exist versus the current flow of, like, 200 x relative to their circulating supply. Right? So, like, the you know, my token trades for a $100, but all the tokens ever

will be will be $2,000.

I'm sorry. It'll be $20,000.

And so,

like, this dynamic, they they listed these things on the spot market on FTX. And for every single exchange,

and for every single token, right, Bitcoin or ETH or whatever, they list spot market and the derivative market. And and with with FTX, this was,

mapped out. You could cross collateralize anything. You could collateralize your your Bitcoin derivative position with Dogecoin if you wanted to,

which is which is just madness. But, regardless,

these tokens that that that they spun up in early 2021,

like, maps was a DeFi pro was a map, like a like, literally, like, Apple Maps, Google Maps

with a DeFi wallet in it, which, of course, needed its own token.

And they did list it on the spot market. They'd pump it with Alameda,

and then they list list the perps market, like perpetual swaps, and they would hedge out as much as they could, dump as much as they could via perps. So, like, as a VC, your coins are locked. Right? This is, like, the magic thing with smart contracts in the blockchain. It's like, oh, it's not invested legally.

It's like, you know, your your stake is locked. So they pump these things to oblivion, and and then they'd go out and they just immediately dump, like, all the FTT, the FTX perpetual swap contracts,

specifically, like, the Solana coins down only from the day of the of the listing price. And this was kinda like a running joke. There was a couple running jokes that Solana coins, Sam coins, when they were listed on perps, were down only, and that,

Alameda and FTX were, like, separate entities. Like, the people on crypto Twitter kind of knew that they weren't or that, like, you know, the Arthur Hayes style bitmex of, like, basically having all the proprietary data to, like, run run your user stops and liquidate them. Right. This was kind of a known against their users.

Like, this was known. And so the the thing that really blew my mind was that when

1 like, the the first red flag for me, this was over the summer. I had some I was kind of, you know, in the in the weeds of crypto Twitter because I like to pay attention to these things. And there was a couple people that were, like, that were just making jokes about Sam and and him swimming naked and and being leveraged to the tit leveraged to the tits and it being a giant psyop that he was coming on bailing everyone out. And he was, you know, bailing out Voyager and bailing out BlockFi with with, you know, credit lines or something.

And then

Voyager goes bankrupt. Right? And the docs come out and and

Alameda's, you know, bailing this firm out or FTX or whoever the official,

you know, official One of them was saying. Yeah. And they had borrowed. They were a creditor

or I'm sorry. They were a debtor to Voyager to the tune of 370,000,000.

And it was like like, I didn't know why. I didn't know if they just wanted to keep the line open so that Voyager was getting some interest income or whatever the reason. Or I I was one of the things I proposed,

I pub I posted this on Twitter. I was like, I don't I don't know the denomination of this debt. Maybe it's they borrowed Bitcoin, and they're short selling or something. Right? That's possible. Like, crypto denominated,

loans between these firms.

And so I just kinda noted that mentally. And then the the CoinDesk bombshell comes out. And it was it was I was also surprised that people on crypto Twitter weren't making a bigger deal out of this because it was like,

I mean, they have $14,000,000,000

of assets. Right? And you go look at I've never looked at the FTX market cap or FTT market cap in my life.

And this this shit coin literally just gaps from $2 to $20 or whatever it was. And they they're marking it to market for 1,000,000,000 of dollars

of assets. And using it as collateral.

And and yeah. Who know? Like, we didn't know what they were using it for collateral, but, like, if you just

know basic finance and math. Right? Like, they had 8,000,000,000 or 7,000,000,000 of of of assets

versus, like,

of of FTT assets, and then never mind the other slot of coins. And then they had, you know, 6, 7, $8,000,000,000

of liabilities, and and we didn't know what those were denominated in. But, like, of your net equity,

you have 90% of it in an exchange token where there are no natural buyers. So the question for me was and and I had a you know, I I figured out this this answer a few days before, and it was it was sort of a horrifying realization. But the question was, who is the counterparty? And I was poking around asking some people in the know because, you know, just notice people as industry like, is your desk borrowing,

pledging, like, allowing FDX to pledge or Almeda to pledge FTT collateral. Like, who in their right mind would do this? Like, Genesys like, I I heard it was Genesys, and then, you know, I was like, no. It's not them. With beyond a reasonable doubt. And I I was kept poking around, and the realization that after Caroline's tweet of, like, hey, CZ. We'll buy all your FTT for $22.

The realization was

why would they be interested in defending this mark to market price?

Like and it was crazy that no one could no one, like, especially the crypto That was an obvious desperation tweet when Like, it was literally like Do Kwon. It was like steady lads. Like, we're you know? Like, why would you be interested? Like like Talk talk about one of the all time dumb tweets though. Here's my price for that's gonna blow up everything.

And and, dude, it was so And you saw them defending it on the chart too. They tried to defend. And and the the thing that was amazing, so,

when Luna was collapsing, I was on a plane from, from Mexico across to Portugal.

And as I was getting on the plane, it was through Canada. Right? So my my leg to Canada, we got to see the the lunar price, like, breaking down below, like, the 98¢ level or, like, the 1 minute charts. We're watching this thing as it as it as we take off. And then you get to Canada, it was down to, like, 60¢, and then by the time I was in Portugal, it was, like, you know, a fraction of a penny.

But the way that FTT

managed to achieve the exact same result in, I would argue, shorter time is just remarkable. It doesn't even have a minting mechanism. It's just wild.

Yeah. It was like, alright. These guys are defending this, and I I, like, I don't

have any interest in in keeping up with with any of these shit coins. Only if I think it's relevant to the Bitcoin market. When I pull up FTT's chart, and I've been doing this recently, I I really like looking for whether it's shitcoins or Bitcoin or or equities,

I like looking at, like, volume profiles. You can kinda, like and you can do this with on chain data too, which I think is valuable, but just looking at, like, where have coins traded hands.

And and I look, and I just laugh to myself because under $22, there is not even, you know,

10:10,

you know, FTT tokens that have changed hands or It was basically minted at $20. It was yeah. Basically. Right? And then it it was obvious that they spammed it up.

And and then I'm I I Do you remember, Dylan? It was back in, the whole DeFi summer thing on on Ethereum. I don't know if you were following this, but,

there was this pro this protocol called Cream Finance.

Yeah. So,

this this Cream Finance being,

spins up, and the whole

argument for why you would use this thing is you could deposit literally anything as collateral.

So what did Alameda do within, like, a couple of days, this this brand new,

you know, shitcoin casino spinning up. They stick a bunch of the, FTT tokens in there, and then they short the the Wi Fi token, which has also been pretty much down only.

And, it's it's just a great example of just, like, printing free money, maintaining a price somewhere else,

using it as collateral, and then, you know, trading on on some other venue. It's just it's it's just crazy.

Yeah. It was it was, actually,

I wasn't paying much attention to that during summer, but Brad Mills brought that up before like, a couple days before they collapsed. We're talking about it, and I was like, there's no way these guys are that dumb to lever against it. And he's like, dude, no. They they did did this during DeFi summer. They were went on you know, they took, like, however much FGT they had, and there was no market for it other than FTX.

And no one held any supply except them, And they leverage it as collateral, and we're just shorting just garbage.

And that was for me. I was like, oh, wow.

And I'm looking at the difference between, like, the Binance rate and the FTX rate,

on for FTT, and I just see, like, a huge disparity forming, like, at this 22 doll like, it was obvious that Alameda or someone FDX was defending. And it was like, okay. Even if Caroline like, even if these guys aren't bluffing, and they have 500,000,000

liquid. And I was surprised that the crypto derivative, like, cartoon character traders couldn't understand this this reality.

Because even if they have like, even if Caroline has 500,000,000 liquid to literally just OTC buy CZ's stake or to just buy

you know, just to defend in the spot market.

This is like an emerging market currency crisis where, like, you have perpetual swaps on FTX and Binance where I can take $10 and and short sell a $100 of FTT.

And he saw the open interest exploding. And right when 22 fell, I was watching I was watching the minute chart for most of the day. I was, you know, quite a waste of time, but I saw I saw

22 fall in the gaps till, like, 19, 18, 17, whatever it was. And I look at at the, you know, these, like, open interest derivatives or whatever,

and I see, like, it was a $100,000,000

of open interest on FTX just,

like, just get wiped. And that and that for me, held held the spaces when we published it to our newsletter. It was like, they're leveraged against their token. Like, this is the the this is like, the counterparty here

is not another this is at the solvency of FTX itself.

And it's, I mean, it's tragic. Like, a bunch of people lost their money.

It was I mean, ironically, some people were shorting FDT on FDX, which is like Yeah. They all got fucked.

Like, you know, gigabrain move.

But, I mean, regardless, I don't I don't give a shit about any of these stupid

Ponzis. It's just like, you know, I don't know. Ponzi scheme. Like, FTT was a straight Ponzi scheme.

Yeah. And, like, and, you know, all the the Solana ecosystem it was it was crazy because, like, everybody thought these guys were, like, you know, so, like, proprietary quant trading firms or whatever. And in reality,

they were just, like, you know, the biggest whales in the room that were using they they probably, I would say, were using FTT, Solana,

Oxy, and whatever as collateral and just bully market making on on, FCX for all of 2021. And who knows when they sustain the losses.

It was Shitcoin 2.0. Like, they took the ICO model, and then they just added a full stack exchange on top of it where they can trade and borrow against their own token and their users on the exchange.

Yeah. And with all that edge, they still lost. It's just fucking wild. Like, how the hell do you get that edge at trading? Yeah. It's it's them in leverage. Right?

I mean, cz straight up killed them. Right? Like, cz smoked water and water. I mean, this all started with the CoinDesk article where it, like, leaked Alameda's,

positions

and, like, that they had a lot of leverage on top of their FTT. And I'm pretty sure, like, CZ was connected to that league,

and then he went for the kill shot publicly.

He needed, like, cover. It was like a false flag article.

Yeah. I mean, and and even if it wasn't right, he, you can see that he's a he's a pretty skilled operator. He saw the opportunity and and he took it. And, you know, like, how whatever story you wanna believe. Right? That he, he kinda knew beforehand or even if he didn't and he was just kinda saying, well, get me out of this token. In either way, he didn't wanna hold the FTT

and,

you know, we saw how that played out.

I mean, it really yeah.

Yeah. It was the it was the speed that shocks people. Right? The the speed at which everything went from, you know, it's all fine and there's, every every, you know, influencer on Twitter saying, oh, I think there's a 0% chance that FTX is, insolvent to, you know, the whole thing is a complete house of cards, and actually it's it's worse than that. It's completely

fraudulent. Like, the, the the rate of change was just unbelievable.

Michael,

Jason Eck said, they did not lose. They laundered 1,000,000,000,

into the shadow government. It's naive to think they lost the money. I think there I mean, there's some merit there. Right? Like, it wasn't maybe it wasn't just a political money laundering operation. I mean, I I don't think it was, but it's like, how did Alameda how did FTX lose all this money? Well, it's like, well, they they lost all this money because they weren't it wasn't all just trading losses, which I I no doubt, you know, given,

you know, it was transferred. Yeah. Yeah. It was transferred. Right? And and because of that mark to market collateral and leverage,

they were solvent on a on a mark to market basis. And they could never realize

that,

those gains.

They could never mark to market that solvency.

But, you know, they they could they could take it for a while.

It's known that they've that they I mean, Sam was

one of he's, like, the 2nd largest political donor.

Like, a lot of this money did go into

corrupt politicians.

But, I mean,

Sam also did not

you know, Sam and his crew, Gary Wang and and Caroline and whatnot, like, they were not planning on blowing up. Like, if CZ hadn't taken that kill shot,

like, they thought they could survive, and, I mean, they were a way bigger threat to Bitcoin

in general and Bitcoiners in general if they survived this this downturn.

I I find it hard to believe that they intended they intended to die. They just

were not humble shitcoiners,

and they got greedy, and someone called their bluff that had a bigger bag than them

and, took them out.

Matt, do you think I I know Marty loves these rabbit holes, and I haven't listened I haven't listened to the the rabbit hole recaps you guys did post FDX collapse. They've been intense. I I imagine. Do you think, like like I mean, I a 100% agree, and the the the best thing is that Marty was tweeting this this stuff 6 months ago, a year ago. Like, FTX is an attack on Bitcoin, etcetera.

Yeah. Do do you think

that this whole thing was,

like, you know, funded or, you know, there maybe, like, there's 3 letter agencies involved, or is it just, like, incompetence,

greed,

and, you know, a feedback loop of of, ignorance that just imploded?

I think there was heavy corruption

as to be expected,

and I think Sam,

was a product of, like, elite American culture

and had a lot of good connections.

But I think, you know, I think mostly he was

a Fiat maximalist shit coiner

who was never really a Bitcoiner,

who came in and was playing the shitcoin 2.0 game. I mean, look. We've seen Vitalik and them play a similar game, right, with lobbying and paying people off.

So, I

mean,

I don't look. I it blowing up is definitely not an effective attack on Bitcoin. If anything, it's the single most bullish thing I've seen in Bitcoin in a long time. I mean, it sucks for the people who lost money,

but them blowing up is not

an effective attack on Bitcoin. Them surviving

would have been an effective attack on Bitcoin.

I mean, at the like, I think they were trading paper Bitcoin. Right? Like, I I think I think a lot of, I think a lot of exchanges are trading paper Bitcoin, and some of them are still working today. I mean,

KuCoin has their was the yield on in KuCoin deposits is, like, over a 100%.

Totally

legit.

Which is which they're, like, trying to encourage people to deposit in a bank run scenario is is why that that quote, unquote yield is so high. Right?

And when you think about that so it's nice to have this foresight because we've all been talking about, you know, the risk of yield and, you know, you are the yield and leverage and paper Bitcoin and, you know, perp swaps and all this kind of thing.

At some point in time,

this whole

event was gonna happen. Right? Whether whether the pin was by fraud or the pin was by just a a major scale deleveraging event. And either way, we've essentially had the, the absolute peak maximum flush out you could possibly ask for. Right? It has removed not only, like, the leverage. It's one thing to remove the leverage. It's another thing to remove the venues that offer the leverage.

So, yeah, I I agree, man. I think it, I think it really is one of the most bullish things for Bitcoin in a very, very long time.

It's painful,

but this is what a free market does. Right? It it expels the bad actors. There's no bailouts coming here,

and, and Bitcoin continues to tick on. Right? New block and, it's it it it we've essentially removed

an extraordinary

amount of the malfeasance from this space and, woken up a whole new class of, of Bitcoin as you're aware of it and know what to do now. A 100%.

I mean, to to me, the jump the jump in the in this in the theory is is the deep state started FTX.

There's no doubt in my mind that there's heavy corruption in the American government. Like, I've talked about this frequently. This is one of the reasons why I love Bitcoin. It's one of the reasons I like the greater open source movement. It's one of the reasons dispatch exists in the first place because we can't trust any of these motherfuckers.

But I just you know, if you wanna talk about

the deep state attacking Bitcoin, they've been very effective with their KYC rolling out to every single on ramp and off ramp.

There there are very effective attacks.

You wanna talk about the deep state? Well,

you know, maybe they're involved in

the the US mining industry now.

Right? We have large public miners. They're very easy to regulate.

They're very easy to to pull the trigger on. To me, FTX is a story of shit corners doing shitcoin things, fiat maximalist that's elite doing fiat maximalist elite things,

and playing games. Right? And,

a lot of politicians are caught up in that. Probably a lot of, you know,

agency folks or whatever you wanna call them are also caught up in it.

But

for it to be like a thought out plan to attack Bitcoin is

is, to me, is a reach and requires some some more evidence on that front.

It's just an easy thing to say. Like, oh, this is this is the attack on Bitcoin we've been waiting for. I think the attacks are way more insidious than than this. This is just

I mean and and, like, one of the main pieces of evidence is, like, SBF is not in jail yet.

Well, like, name me a shitcoin scammer that's in jail.

Yeah. I mean, there's a on it? There's crime happening everywhere and people are in jail. Is Machinski

is Machinski and Celsius part of a deep state operation?

Right? Like, are the EOS guys,

you know, Brendan Bloomer and stuff, who have a 150,000

Bitcoin, are they also part of the deep state operation? Like, most shit corners don't go to jail.

That that's the reality of this People didn't go to jail 2008.

So Exactly. It's it's all the same thing.

On that note, though, I mean, Dylan, I've seen you've been tweeting about BNB.

I've seen you've been tweeting about Nexo, about KuCoin.

I think you've been tweeting about DCG. DCG has been in my crosshairs for a while.

I find it really hard to believe that we don't see more

of these

fiat institutions kind of crumble before this cycle's over. What do you guys think in here? Did you yeah. Did you just see this is this is pretty ironic.

I guess this came out,

an hour or so ago, but, I mean, we could kinda see it coming. So DCGO owns all these these, subsidiaries or whatever.

They're looking to to dish CoinDesk

to raise funds,

and it's kind of ironic because CoinDesk leaked

the broke the story that broke DCG. Story that yeah. The broken DCG sell CoinDesk to cover their losses as a result of reporting by CoinDesk?

One of the approaches suggested a $300,000,000

purchase price, but it was considered too low. Some of the people said, CoinDesk was making about 50,000,000 in annual revenue

from a mix of traditional online advertising and its popular consensus conference. Well,

that is a laughable valuation in my opinion.

And, yeah, I wanna talk about You're a forced seller. You need the money. This is the pain. Right? The sharks are in the water. They know that they have to raise money,

and they'll pay bargain bottom price because you need it. It's not about what you wanna sell, what you have to sell.

I mean, money's tight right now. It's not just Bitcoin.

Like, the fed tightened, and now everyone like, I

Dylan knows because me and him are good friends that, like, I was giving him shit privately about all the fed tea leave stuff.

Like, this is what the fed wanted. Right? They wanted all the fiat companies to blow up, not necessarily in Bitcoin as well. I mean, as as part of it's just minor part of it. Right? But money's tight. DCG was able to survive all these years

because they had easy access to cheap external capital. They don't have that right now. If you're trying to raise in this environment,

it's pure desperation.

Well and this is, like, the this is a dumb thing about and, I'm I mean, purge it all. Right? Like, all this mark to market leverage against a liquid collateral

needs to and it it has, for the most part, blown up. But, like, DCG,

you know, who or or Genesis, right, is lending to 3 arrows capital. Like, I I think Bitcoin collateralized lending

is is gonna be a very, very vibrant,

and and healthy, eventually,

ecosystem,

especially when Bitcoin's volatility or realized volatility

falls a tremendous amount. And even now, like, you don't have to as long as you overcollateralize.

Right? Bitcoin trades 36, 2 247, 365 across jurisdictions.

It's not liquid in in absolute value. Dumps, so you can sell the collateral and and cover yourself. And and so in theory, like, Bitcoin,

collateralized leverage.

Like, the fact that you can get, you know, for a mortgage, I mean, it's not 2% anymore, but it used to be 2, 3% in the US.

The you're telling me a house is easier to liquidate. Right? It's not. And now it's, like, 7. Right? So

but regardless,

I think Bitcoin collateral is is is a, you know, pretty tremendous thing. It's fungible. It's portable. You guys know all these things. But the crazy thing was that, you know, 3 arrows

capital is pledging fucking Axius Infinity and and,

AVAX and GBTC

as collateral.

And these things, it's like there's there's no liquidity. Right? So so Genesys and BlockFi take massive losses, and then what happens? Right? DCG, who's a buyer of GBTC

at at the top because they're trying to arb the the discount,

the discount keeps going lower and lower and lower, and grayscale comes out just like a week ago and says, no. Don't worry. We were hedged. Yeah. You can hedge the Bitcoin exchange rate. Like, you can, whether it's through Genesis shorting, and it, ironically, might have been shorting on FTX,

or, you know, some some swaps. Like, you can hedge the Bitcoin discount. So these guys are plowing money with leverage

with because they they tapped a a $600,000,000

credit line in November of 2021.

They were they were buying GBTC to try to close this discount. 3 arrows capital blows up. They're a forced seller of a massive amount of GBTC.

The discount goes lower. Right? And so then Genesys blows up.

Yeah. Well, DCG is a it's a subsidiary. Right?

Genesys blows up, but you can hear subsidiary of DCG. Yeah. Yeah. Sorry. I'm I misspoke there. You're good. You're good.

Genesys blows up because

they're they're freaking, you know, touching the the perpetual motion machine that is Luna and 3AC and doing all that stupidness. Like, they swapped a 1,000,000,000 and a half of Bitcoin for UST,

and who knows how much they they took on that hit. Right? Like, there's no way they got all they got out unscathed from that UST mess.

And DCG bails them out. That's insane. They took they took I saw that as well. They took 1 and a half $1,000,000,000

worth of the Terra

stable quote, unquote stable coin that went to 0.

Yeah. It's wild because I I've so the reason I never looked into Luna is there was this other project way back in the day called Haven, which is like a fork of Monero, and they're the same thing. I remember Haven.

Yeah. So, basically, the concept is that you burn tokens to go from the stable coin into the thing. I was like, well, that is great, but what happens in a bear market? Just just not even from a Ponzi scheme perspective, but in a bear market, if you know that your stable version of it is gonna be buying more of the token at the bottom, even if you want to buy the dip, you would wait as long as possible, and then you apply that across everyone. And as soon as you know that, when people go to swap back, the token supply is gonna go to infinite, and it's like, well, this whole thing is just gonna go to shit in a bear market. So when Luna came along and I saw that mechanism, I just never looked into it. But, you know, next minute, the thing's 40,000,000,000 and you've got DCG taking a $1,000,000,000 worth of thing. It's just wild.

How do people not do this due diligence?

Well, yeah, I think that's the thing is, like,

you know, there's there's a whole bunch of people that were whether it's, like, you know, Genesis or Barry or, you know, Suzu and Kyle Davies or Almeda and SPF. It's like all these smartest people in the room. Right?

Like, what were they doing? It's like, well, the smartest people in the room during an up only bull market were just the the most degenerate

leveraged

liquid shit corners. I mean, it was just it's it's it's all one trade. Right? Like, I I mean, fundamentally, like, when I say it's all one trade, I I don't mean that, like, that shitcoins are are,

you know, the same as Bitcoin, but more so, like, they ride that same liquidity tide. And to an extent, Bitcoin rides a liquidity tide of legacy markets in a way. It's it's beta to that

to a certain extent. And so these guys, right, like, Barry. Right? Supposedly, like I mean, I I don't doubt Barry's a a smart businessman. Right? He's doing something right to be at this position.

But Barry was buying 100 of 1,000,000 of dollars of Zcash at the top and and and and, like, promoting it. Right? So so fucking idiot.

So so what's that doing? Right? So how's that going?

And and he's wrecked. And so, like, Genesis is is meth is fucked, and they borrowed their

own money. DCG.

Barry and DCG were in the perfect position. They were just minting fucking management fees on GBTC,

and they got extremely greedy and extremely reckless,

and they refused to blame themselves on it. They say this is an ordinary

course of business. And we saw the same thing with with BlockFi. They're like, we couldn't have seen it coming. Like, FTX, it's all FTX's fault. Like, they were solvent before FTX, quote, unquote, saved

them. Like,

Bitcoin is a movement of of personal responsibility.

Users have to take personal responsibility, but that just that goes for the operators too.

Like, these guys built this fucking dumpster fire themselves, and now they have to sleep in it.

It's amazing how GBTC is it's like you can really track it back, and there's a lot of people who've who've made a, I think a very credible claim

that the, the fact that GBTC

existed in its current format where it's not an ETF, it's a closed end fund, you cannot get the redemption on the other side to arb the peg back, that's essentially been the widowmaker of this cycle because

all of these positions were

baked into the fact that, you know, and also just the bull run. Right? A huge chunk of the bull run back in January, February

2021,

was a result of people buying 600,000

BTC

and, dumping it into GBTC to arb down the premium.

And, there just wasn't the demand to to sustain that and then all of the pegs blew out.

Well, it's not really a peg. It's it's a free floating,

asset really.

And,

you know, that that was kind of the end of of all these different, different trades. Right? People leveled up. People assumed that this thing was gonna go back to, to a, you know, 0 discount,

and, it just didn't. And it keeps getting worse and worse and worse. And, that really at the center of this whole thing

was the, kind of the the cancerous lump that mutated into everything around it. And you're right. Greed and just the ability to print print your coins, and it's just it's nasty. But, it it does feel cleansing to see it all get flushed out. That's for sure.

Yeah. I mean, can you imagine just fumbling that bag? Right? I I mean, they're gonna hold on to and the the reason that DCG is trying to sell CoinDesk is because they wanna keep grayscale as much as possible. Grayscale right now, every single day, prints 30 Bitcoin in fees.

30 Bitcoin. They have 630,000

635,000

Bitcoin. They sell 2% of that divided by 3.65 a day.

Well, they print more than that. Right? Because they have all their shit coin closed on funds too. Yeah. True. Right? The n eath 1 and the zcash 1 and the Ethereum classic 1.

It's it's insanity.

And I think that they might,

you know, might not make it to their side or might have to sell this or sell that. It's like,

you know, they they definitely did did not stay humble.

Well, you know, bunch of degenerates in this in this space. That's for sure. Tale of the oldest time. But this time, the scale was way higher. Like, in absolute terms, it was way it's way bigger.

So does so does Binance survive the cycle?

I think it does.

I think a lot of people poke at c z. And again, I don't have any inside baseball here, but,

in in terms of finance, like, all their wallets and things, and again, like, you know, without any kind of inside knowledge,

when I go back and just look at, you know, and reflect on my experience poking around exchange balances, just seeing how these operators work, you know, when you spend enough time with any kind of whether it's data or whatever it is that you do, you just develop a bit of a intuition. Right? And you kind of recall, you get a bit of a gut feel of things.

Binance's exchange balances have never been hard to track. Right? They're they're actually quite quite transparent,

and they've pretty much been up only, and they've got an enormous amount of coin on them,

and continues to grow. So, you know, when we when I kind of go back and just rummage around in in memories and and try and work out if I've seen I mean, obviously, Binance is is in the same,

offshore

type condition.

So regulatory,

probably still a big risk.

When I see him moving to his own BUSD token, which I think has Paxos or or something on the on the back end of it,

That to me looks like he's derisking. I saw a question in the comments here about is Tether gonna blow up. Well, I mean, if Tether was to blow up, CZ is currently doing a whole lot of behaviors that would signify

he's derisking his own exchange,

from that tail risk.

So,

when I when I look at what Binance is doing, a BNB,

as much as it's it's a shit coin, right, it it also is if you if you kind of just, you know, take a very objective view of things, it's the exchange token of the largest exchange in the industry doing something like 80%

of the total trade volume in this in this market, which is wild, by the way.

You it it's also built like 50 before

before Yeah. Fearless trading. Like that. Yeah. And then they did Fearless trading and all that kind of stuff.

So when you kinda look at it, it's it's essentially the equity token, right, inverted commas of, the largest exchange, which can be used to print money.

It's not actually equity,

continues to just print users and, not only that, it built another shitcoin casino off the back end of it, which is the the Binance Smart Chain. Right? Which was, I think a lot of people miss how big that was during the bull market.

That was where, you know, you you you come rockets and all those wild tokens are trading. That's what the people wanted. Right? So Binance built the world's greatest casino of all time and then also put a chain hanging off it. So at the very least,

the BNB token has a hell of a lot more use case, again, inverted commas, than FTT did on a relative scale.

So look, I don't know the I don't know the future, but, at the moment, I'm yet to see anything

too scary about Binance. There's nothing that's got me immediately concerned.

It's still what I mean, again, you've gotta you gotta take the

take it as a stand. You're still running a casino that is outside US regulations,

probably isn't gonna be on the right side of regulations as they come out,

has a whole bunch of their own token, which, you know, there's there's securities laws, all that kind of thing in there. So, look,

it's certainly not risk free, as with all custodians. I certainly wouldn't leave my keys with anyone else. But Yeah. Not your keys, not your coins. No. Your keys, not your coins, but my my my relative probability for Binance imploding is not enormous.

Yeah. I agree. I I mean, I don't think it's it's a it's a high probability. What I do think, and I tweeted a bit a bit about this last 2 days,

and certainly being skeptical. And maybe I'm just jaded from the last 9 months. Like, that's certainly

totally possible.

Or jaded or paranoid or skeptical or all 3.

But when I just think about,

this is not even about CZ or Binance, but

the CZ

somewhat seems to be running

and and, I I mean, I guess it's logical. He's just trying to take market share. But, like, it's almost like he's running, like, the SPF playbook of, like, sticking out his chest and saying, hey. We're gonna bail everyone out, and, you know, we're gonna,

we're gonna raise for an industry recovery fund when 6 months ago, he said when SPF was bailing everybody out, he goes, I don't see the need to bail out any of these actors. Let the free market work. And now he's saying, hey. We're, you know, we're gonna raise $1,000,000,000.

He tweets out 3 days after FTX implodes.

Hey. If you see any exchange, like,

manipulating coins or moving coins before a proof of reserve that's shady,

and then he does he

moves some moves some coins and goes he goes, oh, don't worry, guys. It's just, our auditor wants to see this. The previous auditor,

we don't know the auditor now, but the previous auditor was the same firm that audited FTX.

Their firm is located, in the metaverse,

as per LinkedIn.

You had Brian Brooks join,

the former US com controller of the currency,

become the CEO of Binance for two and a half months, and then just left. Former Coinbase too. Former Coinbase, like, chief legal or compliance or something. Right?

That one is concerning. Like, why why did Brian Brooks leave?

That's that that one is a bit of a concern. Yes.

And so Cooley too. Right?

Cooley? Was Cooley Binance US as well? Was that Catherine

Cooley? She's ex regulator that was Binance US for a little bit.

And, Yeah. It's just like the, you know, the reason that think about this. Like, the reason that

and it makes sense from the US regulator perspective. The reason that ftx.comandbinance.comneeded

to be FTX US and Binance US is because whether the regulators even got a look at their books or not, there's, like, there's no way in hell you're standing up this exchange here. You need to make a different entity.

Like, you used to be able to go on FTX US or FTX dotcom as a US citizen and and use it, but you just couldn't access the perps and and all the the leverage tokens and whatever.

Then they just stood up an entirely new different,

entity, different domain, which, I guess, was basically the same just with a different UX.

Regardless,

you know, the couple things I listed and and also

just kind of CZ,

like, sticking out his chest. I I don't know. Like, I I also have a hard time believing this is my last point here on the on the financing. And I'm not trying to flood anything. Like, I I don't think these guys are,

as, you know, I don't think these guys are Not your keys, not your coins is not FUD, period. Yeah. Yes. Facts. And I think this is another that.

Yeah. Not your keys, not your coins. Also,

you know, I've I've questioned a bunch of exchanges as as, you know, a bunch of people have.

The the the laughable thing to me is when people are like, oh, FUD. FUD. FUD. FUD. No. If your exchange is solvent,

right, actually, maybe one of the best things that could happen to your exchange and from a reputational standpoint and from a trust standpoint and from a longevity standpoint is if you get bank run and your operations

work completely normal. And you go, yeah. Yeah. We yeah. Everyone pulled their Bitcoin, their ETH, their USDC, their Tether, and everything, yeah, everything was fine. We processed all withdrawals. There is not a problem.

The only reason that you wouldn't want that is if you didn't have the coins or running fractional reserve or etcetera. And so I don't think Binance is doing that. I mean, on chain, we can see they have freaking 600,000 Bitcoin.

But when you mint a token out of thin air I just think about incentives. This isn't even about CZ or Binance. When you mint a token out of thin air

and, you know, maybe CZ's been through multiple cycles like he and we know he has. So maybe he didn't get caught up in the euphoria and all this. But Is this a spot? They hold they hold 50% of the BNB token, or at least they they got 40% in the presale, the ICO.

BNB

BTC has been up only. And if you look at the chart, and I posted kind of a mini thread on this today with some, like, volume profiles or whatever, The thing went up 9 x on, like, no volume at the the the beginning of 2021, and that was during the whole DeFi craze. Right? Like, Chexit with all the, you know,

you know, cake cake swap and all this other stuff. It was all built on the BSC, the Binance Smart Chain Casino, which used BNB.

But b and b BTC is up only. You have, like, all of the volume for b and b perpetual swaps is at the top. And when you have a token that you minted out of thin air that you say you've never used as collateral,

but it is worth 5th $50,000,000,000

at the top. Right? So so you're telling me, like, they never ever once just in their own books natively

borrowed against that, and I would say I have a hard time believing that. Maybe I'm just, again, jaded, skeptical,

paranoid. Who knows?

But

I would would I be surprised if they were swimming naked? Would I be surprised if they leveraged against their own token?

Which you can do on their platform. And by the way,

if you go on Binance if you just look up BNB collateral,

Binance, you can borrow you can users can borrow against their BNB collateral. And then and then BNB is only 50% down from the highs. Right? Every shit coin that serve as beta for Bitcoin is down way, way more. BNB is not. And BNB on Binance, by the way, you can borrow against your assets, and they subsidize the financing rate. Right? So so you can borrow, basically, like, for extremely cheap, if not free on this platform using this collateral.

And the fact that it is used as collateral and isn't serving as leverage bait on the downside

gives me cause for concern. So I who knows? This is not like some I feel like I'm, the always sunny in Philadelphia guy that's, like, ranting and it's kind of, you know, just looks like a total

total, like, total kook. But, like, the asking questions in this industry has never gotten me to a place that

I, you know, like, has has never served me wrong. Right? Even if it doesn't come true or there's you know, I I jumped to the wrong conclusion. It's never hurt me to to go through hypotheticals.

Because at this point, like, literally, nothing

nothing would surprise me.

And that's why I don't know if you have to go through hypotheticals. Ever a time for this shit to blow up, it's right now because you've got the maximum amount of pain, the fewest number of counter parties to carry the bag,

the most number most volume of impairment, like, prices are down. It's the perfect time, and this is what bear markets do. Bear markets are forest fires that clear out all of the junk that gets accumulated over the course of the bull,

and man, did we accumulate some junk this bull?

Yep.

No. And I'm so here for it. So so Do we have Binance?

Does,

so we have this comment from Aaron Bax in the matrix chat that Chek

mentioned briefly about Tether blowing up.

I just wanna say, first of all, I mean, you know, Tether is a trusted third party that's actively breaking US regulations.

It's a massive amount of counterparty risk to hold Tether.

A lot of us have been, you know, expecting Tether to blow up for a long time and have been proven wrong. Do you guys think Tether survives this cycle?

I actually do. And so so Tether's again, Tether's one of these cockroaches that just won't go down. And,

when you asked about Binance,

before whether that's kind of the next next domino, is there any risk?

I actually put Binance and Tether in the same bucket, and that is that all of the Tether truthers

have been out there for years

appointing at Tether being like, look at this scam. Look at this Ponzi scheme. It's gonna implode, and they're staring at this thing.

Meanwhile, UST and Luna is blowing up behind them, which was an actual Ponzi scheme. It was pretty fucked up with the USD thing, by the way. Like, I was talking to Dario from Moon Wallet. He's Argentinian.

And, like, a lot of the Argentinians got burned on on Terra because they were like, oh, this is the decentralized version of Tether, and Tether is gonna blow up. So I'll be in Terra instead and they all got wrecked.

Yeah. That was that's what was so, insidious about UST is that it was promising stable

coin. Right? And and that's you you're right. The people that actually impacts the most are people who don't have the,

financial capacity to weather that stable coin becoming unstable.

So yeah. No. So with with Tether,

I'm I'm firmly of the opinion that if you go back and look through Tethr's history

and don't come out thinking that there was some malfeasance back in this day,

you there's rocks in your head. Like, it it's it is

so bleedingly obvious

that they are have had to and this is the other thing. Right? You have to factor in that the the US government has essentially put them in a position

from the get go,

where they've had to do some pretty shady stuff to stay alive. And there's no question that if you if you go back further in history, you'll find things where tether is shady as it gets.

And there's probably no question that as a result of that, right, you don't just get over that. Even if they are fully backed at the moment,

they've still got a history where they weren't and trying to make your accounting books,

legitimate

following a period where they weren't is is tough business. So look, I I agree with you what you said, Matt, that, there is an enormous amount of counterparty risk with Tether.

I personally would never hold it. I don't think it makes sense to hold it. I understand why people do.

A lot of people and again,

sadly, a lot of people in the 3rd world and and I I I posted a tweet on yours the other day, Dylan, when you mentioned something about treasuries and I I I see this quite a lot, particularly in the finance world, which is obviously American centric. It it comes as a shock to a lot of people that most of the world isn't American. So when we start talking about, like, why do people hold Tether was because they don't have US dollars. Like, I'm an Australian, and it's really hard for me to get US dollars. It's easy for me to get Bitcoin than US dollars.

This is what people don't realize about Tether. Like, Tether is was born because, first of all, it was hard for Bitcoin

companies and exchanges to have banking relationships,

but also it's hard for for people to have access to US dollars. It's essentially a black market US dollar,

which is also what people miss when they think, like, USDC

or any of those regulated stablecoins is a competitor to Tether.

Because the whole point of Tether is is to end around

US financial regulation of the dollar.

Absolutely. And and, you know, that's the thing. My only interactions

exactly. My only interactions with Tether,

have been with people in the in the third world. Right? People in the developing economy that literally do not have access to stable banking, and Tether is a lifeline for these people. So So I have

I had Sergei a bit refill on last week,

and the 3 most common payment methods

on

on Bitrefill where you can buy gift cards and top up phone time,

with cryptocurrencies

was Bitcoin was number 1.

Ethereum was number 2,

Tether on Tron was number 3, and Binance's,

Binance's,

like, closed API payment system, Binance Pay, was, like, basically tied for 3rd with Tether. So just

to give people an example of of actual, like, on the ground usage,

basically basically, Tether, Ethereum,

the way he described it, if I recall correctly, is basically,

Bitcoin was at, like, 33%

of payment volume on chain Bitcoin.

And then,

like, Ethereum,

Tron,

US, Tether on Tron. And the reason it's on Tron is because it's super cheap transaction fees because it's centralized.

And Binance Pay, which is their, like, centralized

API payment platform, we're all basically a three way tie at 17%.

Wow. Very interesting. I didn't know about that finance pay, but that's,

that's the thing. You you don't realize how long idea it existed.

Neither did I. But, again, it's not a market that you and I need. Right? This that that is a market that is serving people who simply don't have a bank account.

And and this is the thing. Right? If if you actually just take a very objective look at that,

as much as there's probably some shady stuff at Binance as well and, you know, that that they they have a huge shitcoin casino and all the rest of it, these guys are offering banking services that no other Western organization has ever done to the largest cross section of people in the world. And it's one of those things that you kinda do have to just say, you know, tip your hat just a little bit because, it's, you know, that's essentially what the sport is setting out to

do. Respect the hustle and respect the motivation.

Right? He's going for cross section, he's going for size and,

and when I say size there, it's in people. And and this is actually a stat that I, you know, this this one thing that Chainalysis does, very well is their reports about adoption.

And, I read it every single year, and the thing that always stands out to me is the per capita adoption of Bitcoin around the world. And you see that in the west, of course, we have more dollars invested.

But when you look at per capita, it's like 30, 40, 50 percent in in the developing world. Right? You see there's enormous numbers coming out of places like Nigeria or Indonesia, and that is actually what it's all about. Right? You're giving people who have absolutely no other options an option for the first time in a long time, and that's, that's that's powerful stuff.

But Bitcoin's the only one that doesn't have counterparty risk when you hold it yourself.

Indeed. So and and that's, I mean, that's that's an interesting topic and one that I haven't really got to the bottom of is,

I'm I do fall into the camp because I kind of run the ball forward and say, how does the, world look in 15, 20, 50 years?

And,

I I I do

think the most probable scenario is that fiat currencies probably aren't going anywhere anytime soon.

They're definitely going to devalue over time.

Yeah. No. Look,

there's what I think should happen and what I want to happen, and then there's what I think is most likely.

Right? So they're 2 different things. So, I I do believe that Bitcoin

could be the answer. Right?

Hello, singularly, but I don't believe that the governments are gonna let it go of the ability to print shit coins,

anytime soon.

So as a result, we're gonna live in a world where it's Bitcoin and,

US dollars or or or fiat currency.

I'm also of the opinion that something like a USDC

is gonna be blessed by the state because it's essentially a CBDC that's already built. Right? Now they've got the architecture for it. So I think that's a highly probable scenario.

And then the next question is, okay, well,

we know that the Oracle problem will always exist. Right? So how do you create fiat liquidity

that is backed by Bitcoin or at least can cover the,

the counterparty risk to the same extent as Tether. So Tether,

I think is probably gonna be in the shotgun of the law.

I I I struggle to believe that the US government's gonna allow them to tick along for too much longer, but again, we've been saying that forever.

But I'm just trying to I've been trying to work out what the next phase is where you actually have some kind of I don't wanna say decentralized, but, minimized counterparty risk,

stable coin or stable asset.

The problem is that the Oracle the Oracle problem is just unsolved.

So you you can never get the price feed into this thing, but, that's certainly a it's it's an area for,

of interest. I'm skeptical it can be solved. I don't believe in these algo stable coins. I think that's crap shit, but collateralized

with Bitcoin

and Bitcoin that's not, you know, wrapped Bitcoin, like actual Bitcoin,

that can be, trustlessly redeemed on main chain.

Something that can fit that

brief, would be just an unbelievable

piece of infrastructure.

And the only thing that I've ever thought of that has any potential about

that is, you know, the,

even though the perpetual swaps have their problems,

the idea you can go one x short of Bitcoin and that essentially locks in a $1 exchange rate. I've often wondered whether there's something out there that can be built that's, essentially is that's one x short. Isn't that like the The the Goloj money is doing stable stats or whatever. But they're trusted. This is the this is the problem. Goloj money, I think it's, like, an an El Salvador project. Right? Yeah. Bitcoin Beach. It's Yeah. So that They were the ones behind Bitcoin Beach Wallet, but So they I think Czech American. They short,

they short Bitcoin, I believe, on OKEx.

Bitcoin,

collateralized perpetual stocks.

And so it's, like, you know, a dollar with a variable

liquidity

exchange. But I think that's I think this is the the golden goose for Bitcoin, and and, you know, we'll see if it can be built in a decentralized way. But if we can get sort of a a trustless, and this is the big thing is that how do you

yeah. It's you you really can't remember. Maybe trust minimize.

I think I so I think what happens out of this or maybe it doesn't happen out of this cycle, maybe it happens out of next cycle, is that people start to realize that the only real stable coin are sats.

And when I say that, I mean, it's because it's a very strong foundation. You don't have counterparty risk. Like, your asset is not gonna go to 0.

It's not it's not saying that there will not be volatility. There will be volatility.

But but we we're we're in a world

we're in a a world where

trust is quickly fading in institutions.

We're in a world where on a geopolitical landscape,

countries don't trust each other in terms of trading.

And all of a sudden, we have this we have this asset. We have sets

that don't require any trust, that don't require any counterparty risk if you hold them yourself, if you use your own node.

And I think we also forget that People don't realize that yet. Most people do not We also forget that the fiat only,

is the,

the fiat only regime

is actually the the break from the norm. The norm is a gold standard. Right? So, and none of us have lived in that, right, or very few people have lived in that true gold standard,

for, you know, decades.

So it it it there's this kind of lapse in human memory of the fact that you can actually have gold coins and sound money that works and has worked for most of human history,

but we you know, I think Jeff Booth says it best. We're trying to measure the new system from within the current system, and you just can't you can't wrap your head around it, which is what makes it such a chaotic transition. So, you know, there there is still, that I I'm certainly not in the camp where I'm gonna sign a 0 percent probability to a, a Bitcoin only world because

we've seen sound money standards in the past, and, it's the best sound money that's ever existed. So, you know, you would expect there'd be at least a a meaningful gravity back towards it.

Well, I think there'll always be shit coins. I mean, you can create a shit coin without permission, so

people love to gamble.

I can't even imagine

the Bitcoin. The Ponzi's and the and then the I think it's gonna happen, unfortunately, because Bitcoin is this permissionless thing,

that's accruing value and monetizing,

on balance sheets across the world. But, like, when we saw, like, Plus token and, obviously, the ICOs weren't really, like, on Bitcoin, but you the 2017 era, yeah, you used Bitcoin to onboard onto these exchanges.

Like, the next cycle when I mean and it'll it'll be fueled by Bitcoin native adoption by the hodlers and stackers of last resort setting the floor by by hash rate going up only in Bitcoin's synergy with energy markets. Like, these are the things that fuel

the the adoption or, you know, fuel the the appreciation of Bitcoin and then layer on top of it to generate amounts of leverage that can persist and and, you know, fester under the surface for a while.

But the amount of, like,

you know, nation state level Ponzis that we probably get over the next 10 years is gonna be you know? Just just imagine. Right? Like, Bitcoin to attend like and this is why I kind of revised my thinking of that volatility

might

like, during this bull run, it was like, is Bitcoin ever gonna drop 30%, 50%, 60%, 70% from the highs? And then it was like, oh, of course. Like, of course, we're going to because and I guess hindsight is 2020. You know, maybe next time. Yeah. All the super cycle people Yeah.

The super cycle. Right? Eye on their face. And and funny enough, like, it's almost like a a paradox in a way because everybody that thought that lever to the tits, and then that's the reason why. Every cycle, bro. It happens every cycle.

People at the top think it's never gonna go back down. This time is different, and they get fucking wrecked.

The thing that actually, amazed me about this this whole cycle

is how much it was exactly the same as every other cycle. Right? We've people were saying that there was no 4 year cycle and then here we are. People saying that miners weren't gonna you know, they're publicly traded now. They have access capital. They're not gonna capitulate. Well, how's that going for you now? It's amazing how absolutely

the the one meme

that was supposed to die was that Bitcoin is gonna go through 4, like, no more 4 year cycles.

That was the only meme that persisted. Every other narrative got killed, but Bitcoin being the the 4 year heartbeat,

continues to tick on, which I thought was just a really fascinating

you know, no one expected it because it's not a very exciting meme. Right? The

the the concept that the cycle just keeps going up and down and we get these booms and busts, it it it's

almost so predictable that it's boring,

but within that whole framework, people don't people don't realize that all the chaos comes from leverage. It comes I mean, there's been leverage in

in in previous cycles. It just didn't happen to be literally borrowing fiat. It was, it was it was close to, you know, printing printing ICOs and,

all that kind of shit. So, it it's just very interesting that the 4 year cycle is back and kicking, and, it's the one thing that survived the test of time.

Agreed. It's a great way to great way to put it. And, yeah, I I I often wonder, like, you know, and when, Matt, when you say, like, Bitcoin or SaaS or the stable coin and, like, Bitcoin as a as a system, as a network, is just this, like, steady heartbeat. And the only thing that's changing is, like, our perception of it and, the way that humans interact with it, both the exchange rate and, like like like, Bitcoin is just this intangible decentralized ledger.

And, like, the price chart is just a bunch of humans interpreting it as a different way. You know, Bitcoin's at $16,000

right now, and it's dead. But Bitcoin is price charge now is the only volatile part of Bitcoin.

Yeah. And that's just the connection to the fiat world.

Yeah.

It's it's, I mean, I I despite, like, as much as I've I've done my best to study,

financial history and and market psychology, and and, I mean, that that part of it, served me well. But going through it for the first for the first real time, both from, like, an economic cycle, like, what we're going through right now with, you know, this downturn and a tightening cycle, but also, like, the Bitcoin Well, Bitcoin has never had a recession before. Yeah. Besides, I mean, if you if you wanna count March 2020, but

that was more of a shock.

The scam dump. Yeah. No. It's it's it's certainly interesting just to kinda to kinda live through it. And, I mean, I like to tell myself that

that next cycle,

I'll be prepared for the madness, but who knows who knows what happens?

You won't be. You're gonna go all caps at the top.

Yeah.

To be fair, I went all caps before the top and then continued.

But Yeah. I I I believe 200 k by conference day, by the way. Nice, nice sign up. Had it. We woulda had it. We woulda had it if SPF wasn't selling paper Bitcoin.

Yeah. Well, that's the thing. I I I am increasingly coming around to that concept that the amount of paper Bitcoin in this cycle, and and Dylan, you've probably seen this as well. There was something that happened. The peak, the actual peak for Bitcoin was January 2021 just before Elon bought bought BTC.

That point was actually across every single metric that we that I look at was the top. Right? In terms of, like, where the momentum's

died down, where everything started to decay,

which is kind of kind of wild. Right? So, I'm fairly the opinion that the bear market started in May 2021,

and then the pump back up to the November October high never had the juice behind. On chain activity was down. Profitability was down. There's all sorts of reasons why that was just a a scam pump,

which is kind of interesting. But, the peak in exuberance,

so to speak,

the impulse started to die off from February onwards,

2021.

So,

that was actually where we saw that euphoric move.

And interestingly, I don't know whether it's got something to do with it, but, obviously, Elon stepping in. I don't know whether that kinda triggered the doge maneuver.

Right? People started moving into, you know, further down the risk curve, and then everything just went completely ballistic, plus all the paper BTC.

And at that point in time, you obviously got the GBTC trades, so people are buying Bitcoin and sticking it into GBTC,

relevering up those GBTC

shares. They're basically saying, well, I've already got my Bitcoin allocation because it's the collateral within this paper, and they're gonna use that collateral to go and borrow and spend into the shit coin universe?

And I I'm pretty sure that was the, the overall cycle.

We saw Bitcoin do its thing and, go through a monetization,

rally.

By the course of January, it was pretty much cooling down. People were starting to lever up. We then got our first futures driven liquidation in May 2021,

then we had potentially,

with an element as assistance, but, certainly a bunch of paper Bitcoin that pushed,

the market up to to the all time high, but it didn't have any true fundamentals behind it. And then, 2022 is basically just being the deleveraging,

coming off the back of that. So,

and also,

just I saw this come in, this BTCD,

when it comes to Bitcoin dominance, do not use the one on trading view for two reasons. 1, it includes all of the market caps of shit coins, which like FTT can be propped up by a single market maker. I could print check coin tomorrow and keep the price of a $100,000,000,000,000 because that's the price that I valued it at, and the market cap coin market cap that that BTCD is calculated from will will go down. Right? So don't use BTCD for that reason. The second one is that it includes stable coins. Now I don't think that we should be including stable coins in in the market cap because they're essentially All the news. If if you wanna do that, then Bitcoin dominance is like a fraction of a percent because you gotta compare it to the US dollar. I don't think dominance is just relevant in general.

Well, there is one version of dominance that is relevant, and that is the realized cap. So if you look at the it's it's it's not perfect, but it's it's a hell of a lot better. So what the realized cap is, it's the on chain market cap. Value every coin at the price when it last transacted.

So what that does really nicely

is all of the coins from the Ethereum ICO

that haven't been spent or lost or whatever else, those are not valued at the current price. They're valued at 0 or the, you know, fraction of the cent.

Exactly. Yeah. Same for Ripple. Right? You look at Ripple, all the coins that are held by by Ripple itself, the founders,

they're worth 0 because they haven't transacted. They haven't dumped them yet. So what you're doing there is you're actually valuing coins at the price in which they transacted. If you wanna do it even more precisely,

it has to be the price where they actually were sold and bought.

But what you can do if you do that dominance,

you see that basically it's Bitcoin at 66%

last I looked,

Ethereum's, you know, has expanded its market share is basically flat for the entirety of the 2021, 22 cycle, in terms of dominance, and everything else is basically going to 0. So you've essentially got 2 assets there,

stable coins you can you can remove out of it, but, a realized cap dominance. BTCD is complete shit. Don't use it.

Fair enough. Is that is that a glass on metric deck?

It's not because we don't support enough shit coins to make them.

Got it. So where do you track that? Coin metrics? You can build it. Yeah. You can build it on the coin metrics,

network data,

system. And to be honest, it's one of those things where, like, you could add every coin, but once you've done it for the top, like, 20,

most of their realized caps go to 0 anyway. So it's, you you kinda get the Pareto distribution going.

So, I mean well, first of all, before we go to my

my next tangent,

we you guys said that you don't expect

you

very clear, not your keys, not your coins. Everyone's your self custody. You don't expect Binance to blow up this cycle. You don't expect Tether to blow up this cycle.

Who's gonna blow up this cycle?

We're not Ethereum. Right?

Ethereum.

No. I mean, I think I think there's

a lot of withdraw their staked coins right now, so that might be delayed a little bit. I think we'd have more we just have more to deflate in the in the shit coin space.

Like, Ethereum trading at $1200

or or whatever it is. Like, there's there's still, like I think there's, like, $500,000,000

of, like,

staked ETH,

staked ETH liquidations on chain or whatever. You know what I mean? Like like, stuff like that. Like, and and who knows? Like, we could just you know, this could this could be the bottom, and and that's the any remaining leverage, whether it's DeFi or

or, you know, who knows how much opaque leverage is is still in the system. I I would say there's probably not all that much, but, certainly, some of these miners are gonna go down. They don't have all that much Bitcoin to sell. But, like,

I I just think that,

because of the economic conditions deteriorating,

because we do have marginal buyers, like, with the the sat stackers and can set the floor, but a lot of these shitcoins. Right? Like, FTT had nothing to do with Bitcoin, but it imploded,

and and and the whole system is cross collateralized, so Bitcoin's exchange rate. They have Bitcoin as collateral, and then they sell the Bitcoin because it's the most saleable asset that's actually liquid. And so, like, if if a theory, like, if a theory, just from, like, a psychological standpoint, it's at, you know, a $1,000, if that falls, I think just market psychology wise, like, there's gonna be some blood.

And who knows if it does?

But I I would just Metallic selling.

Yeah. And and that is, in a way, like, reflexive. Right? Vitalik sells people in the ecosystem CEO. This guy sells every top.

They go sell, and it's like a almost like a feedback loop. So, I mean, I don't know. Maybe it's just my bias speaking, but I would I would really like, I think ETHBTC doesn't I I think the cycle doesn't bottom. Maybe this is, like, completely irrelevant.

But ETHBTC is at what? Like, point 07.

Right?

I'm just certainly thinking about Ethereum being just kind of, like, degenerate leverage Bitcoin beta.

And it's, like, mostly,

kind of degen speculators that that buy, hold, utilize the theory. My that's maybe a broad oversimplification of it and maybe unfair to some people,

but I don't think this thing bottoms at 0.07.

Right?

So, you know, from a from a crypto native perspective,

that may be one one more thing that we have to slay in terms of, like, just just fleshing out all of this. But that's I think

The primary risk for me, in that sense is regulation. Right? Because and we're actually seeing this already. So this is something that's just fully captured.

It's fully captured. So, both of the consensus mechanism layout, but also when it comes to all the defi protocols, this has always been,

this has always been the risk. They have all these American VCs.

If if KYC isn't coming to Uniswap within the next 6 to 12 months, I'll eat my gold card. Right? This this whole

process this whole process oh, don't worry. I've got plenty.

The the whole process that the

all these VCs are fully captured, the consensus mechanism is captured,

and essentially and this is my argument, the whole thing. When it came to the merge and we're talking about slashing and all this kind of guff,

my biggest argument is, okay. So when the time comes, the Ethereum community is gonna have to make a social governance decision, and that decision is gonna go one of 2 ways. They either have to side with USDC,

the blessed stable coin, which all their collateral and all their DeFi positions and all their liquidity pools and all their DeFi protocols and so, you know, name your list. If you wanna maintain any of that, both your personal wealth, which is a big one for most people, surprisingly,

if you wanna maintain your personal wealth, if you wanna maintain the integrity of your DeFi ecosystem, if you wanna maintain the reason that people use Ethereum at all,

you have to come across to the KYC side.

If on the other hand, you wanna go full rebel,

well, you can go and choose your other fork, but I'm pretty sure most users are gonna pick the other one anyway. So you're you're both gonna slash each other onto your own chain. Ethereum's gonna fork into 2 different variants. One's gonna be the rebel chain, which will have, you know,

some of the bankless guys on there for all 6 weeks until they realize that everyone wants to go over to the, the USDC side, and then the whole system just has to migrate back over. So they actually, in my view, don't have a choice because otherwise, they have to burn all the infrastructure and start again. And the problem is that all that infrastructure is already captured, so it's basically a one way street.

I have my receipts. I mean, I have a tweet from 2018 where I said that Ethereum is gonna be, like, the KYC AML de facto regulated chain. I mean, but that doesn't mean it necessarily blows up. Right? It just means it's completely cocked and censored.

Yeah.

And actually, I mean, to to to Lynn's credit, let let Alden put out a tweet sometime back,

which,

I think is a very credible case, which is that it becomes captured, and that's actually a bull case for it. Right? Lock up all the tokens. Yeah. A lot of things.

I mean, I think there's Bitcoiners that would think that Bitcoin getting captured is a bull case as well Agree.

Which is unfortunate.

I

I mean, personally, what's on my radar is, like, Nexo, KuCoin.

I don't think Genesis survives this.

I think DCG, like, kinda stumbles out of it, but, like, gets pretty hurt in this whole thing.

I think there's more I think there's more shoes to drop. I don't want retail to get wrecked. I don't want the average person to get wrecked, which is why I constantly preach self custody and tell people not your keys, not your coins.

But, personally, like, I would like to see the most chaotic,

painful

end of this cycle and just clean it all out. Like, the more

the the more carnage, the better.

And I think there's a lot that just aren't on our radar.

You know, I I anyone who's offering any of these centralized products that have been offering yield, quote, unquote

yield,

they're all at extra risk here. So it should be interesting to see it play out.

We're nearing the end of our time. Before we do

wrap up,

I wanted to ask both of you guys. I mean,

Dylan,

you often say you have, like, a lot of dry powder.

I know you posted my

my post that I titled survival,

which is to me, I've always had a survivor mindset mindset in this space in Bitcoin.

And

and and why is that? Well, first of all,

I can't trade for shit. Right?

I've I know I can't trade for shit,

and I I did touch the stove early on in my in my Bitcoin journey.

But the second reason

is, you know, there's a lot of survivorship bias in this space. People think, like,

oh, there's all these traders that did really well, and they all succeeded.

But, really, the majority of them get washed out and destroyed in the cycles,

and we only see the ones that that that survived.

You know, it's like

1%. And then on top of all that, I have this

concern that I've had since

almost like a decade now, and I've been wrong,

which is that, you know, it'll get really hard to acquire coin, whether that's regulated on ramps getting shut down,

withdrawals getting frozen.

I just

the idea of of of selling Bitcoin and buying back in

is just something that I could not sleep at at night. Like, I'm

and this is coming from someone who's all in, been all in for a long time,

working

many jobs to to just continue accumulating Bitcoin slowly and steadily.

So my, you know, my thesis is essentially stay stable stack sets. Right? Just constant accumulation of Bitcoin, holding in cold storage.

I can't even easily sell it if I wanted to

just because

of of of how I hold it.

So when you're when you're thinking about

your strategy, I mean, in that post, in survival, like I said, you know, the

the straightforward plan is is relatively simple on the surface,

which is

which is is to survive,

you know, this bear cycle, which could be long or could be short,

while still accumulating as much Bitcoin as possible just in case we have some kind of,

short squeeze type of scenario. Right? We're seeing less and less Bitcoin traded on exchanges. It's basically the same traders trading back and forth,

while stackers are just constantly accumulating more Bitcoin and more Bitcoin and more Bitcoin.

So there is, like, this tail

situation. There's a situation where just, like, Bitcoin just starts ripping,

and you wanna be exposed to that. But at the same time, you wanna be able to survive, pay your rent,

support your family.

Well, maybe not Dylan because he's he's a young gun still, but

be able to do this in a bear market and a global macro recession, depression, whatever you wanna call it,

without

your your your stats decreasing, without, you know, selling the bottom because you're desperate.

So how do you look on actual, like, executing?

Like, do you have, like, a lot I mean, I know this is, like, kind of personal question,

but, like, how are you looking at your personal plan?

My personal plan is very straightforward and very obvious. I just keep I just keep stacking,

and I'm trying to reduce expenses and

increase cash flow wherever I possibly can.

Like, what is your plan here,

on actual executing on this the end of the cycle?

Yes. I mean, from from my perspective, Dylan, I might just jump in because I gotta jump off in 10 minutes.

So from from my view,

I made a decision back in 2019. So I'm lucky you, Matt. I went through the process of, you know, buying the top in 2018, getting burnt with shitcoins all the way down,

finally discovered Bitcoin, and, I made a very conscious decision in 2019 when it finally clicked, when I finally understood what Bitcoin was all about,

made a conscious decision that my strategy was to stay humble with Stack Sats. And what I'd learned is that whilst I could trade and whilst I could be successful at trading,

what I found is that the amount of time that it consumed from my day that I that I felt at the end of the day, I may have made a bunch of money, but I felt so unproductive

that it just didn't work for the way that my my brain takes over. So I made a very conscious decision

that I'm actually gonna move more towards what I do now, which is the on chain side, and really the motivation for that is teaching people how to do it. Right? That that's why I actually do it.

And the reason for that is that it does provide you with the edge. Right? To to just even as a humble stat, sat stacker to understand if you're on a DCA schedule,

trying to find the best edge you can within your weekly or monthly, whatever your time frame is.

And the other thing that I found is that I actually, there's so much more alpha for me

in creating additional streams of income. So, essentially, what I went down the path of saying is, like, well, I'm going to specialize.

I'm going in in one particular field. I'm gonna specialize in a field that helps Bitcoin. I'm gonna specialize in a field that helps others understand Bitcoin, which is obviously good for Bitcoin,

and help other people survive. Right? Because the more tools people

have, the more people can survive in this market. And sometimes just the knowledge is sufficient for people to get by.

So,

that was basically my strategy, generate more streams of income, specialize in something that's good for Bitcoin and helps other people, and essentially just

build onto those two things and stacks out in the background. Right? So,

when it comes to where we currently are in the cycle,

I'm I'm in in the process at the moment of kind of building out a whole suite of tools that's and and you can see this in all of our reports and and videos and the like class note, but,

we're pretty much in a phase.

Again, we don't know what the future holds,

and, you know, pretending anybody does is is a joke.

But when you go back and look at how previous market cycles have occurred, and this is why I said at the start of this session

that,

on chain analysis is a bit like behavioral economics. You're looking at how the human beings around us behave

and in aggregate.

And what you're looking for when we look at all these previous cycles, you know, people say, oh, it looks like the previous bottom and, oh, this looks like the previous bottom. It's like, yeah, they do. But what you need to look for is

when was

maximum pain, the point of just complete expulsion that was sufficient

to flush out every seller in the past. Because whilst market cycles are different, leverage is different, shit coins are different, macro is different. There's one constant amidst all of well, it's 2 constants actually, amidst all this thing. First one is TikTok next block. The second one is that human beings

and the way that we respond to fear and greed is the same. It's never changed. Right? This way you can go back and look at price charts from the 19 twenties, and they still have TA patterns in them. Right? So the human response to things is exactly the same. So what we're looking for at the moment

is, do we have the same conditions that was enough to expel any and all sellers?

Every single person who's on a Bitcoin HODLer

is flushed from this market. Do we have the same conditions?

And I've said this a number of times, but, we're we're kind of in a stage that if you just take that view, what are the conditions required to flush absolutely everybody out who was gonna sell?

We're dotting the i's crossing the t's on a perfect

example of that. It's textbook.

So it has all of the conditions that you would ask for to have a perfect tick, textbook bottom. So thus, we they can then start looking from that point on and say, well, if we start breaking some of these trends, then we really do have a macro is in the in charge and leading this thing down a down a different path.

Simultaneously,

if macro has any potential, it's gonna start reversing and turning around or, you know, moving back towards losing monetary policy, which I think is probably a almost guarantee. Bitcoin's gonna be the first thing in the world to sniff that out.

So, you know, it's probably going to bottom long before we even know that there's going to be some kind of, of reversal and, you know, we're seeing a whole lot of pain in the market. But,

if I kind of boil that back to some actionable steps,

build your income streams. Right? Focus on what you specialize in and what you're passionate about because that will help you build more income streams.

And, yeah, as you said, now I think that's a really important one is cutting down bills. Right? Understanding where your money is flowing out of your pocket,

and cutting that down.

And the other one is when it comes to,

you know, stacking sets,

you can apply strategy to it. So,

you can do your your DCA. The way that I do it, I DCA once every week, and I use my own edge,

Right? The the tools that I have to try and find the most opportune moment in that week. If the week looks like absolute shit, and I'm like, well, I just don't think it's I think it's headed lower, then I'll double DCA the next week. Right? But you can use tools to help maximize

your SAT allocation,

and simultaneously that achieves 2 things. 1, you get more SATs,

and 2, it also teaches you about how the system works. And when you understand how the system works, you can explain it and describe it, you can then use that information to survive.

When you have no idea why things are going down, when you have no idea why things are going up, when you have no context whatsoever,

it makes it really hard to huddle through both the highs and the lows. But if you understand

why things are doing what they're doing, you can then rationalize it and use that information as your edge, and it makes huddling so much easier. It's such a better journey,

because when someone shit posts something on Twitter, you can go to your toolbox, pick up the right thing and say, yeah. No. That sounds about right. Or you can say, no. I'm calling that bluff. I know something different. And when you see these narratives get carried on Twitter, and you can then look at the data, like, what are you talking about? You're just, like, you're just wrong. And this was my big takeaway from 2021.

I ignore the on chain activity. I I I was tweeting about it back in August September

saying this rally has no on chain activity.

Right? There's no one using the network. And I followed that that gut instinct all the way through to October,

and then price punched to a new all time high and I said, shit. Maybe people are just on exchanges trading paper Bitcoin and it you know, on chain activity does doesn't have any signal. How wrong was I? Right? So I will never make that mistake again. The actual usage of this network

is pure edge, and a lot of people write it off, but it was the thing screaming. This is a lower high. It's not a higher high. Price may be at all time highs, but it looks nasty underneath.

So, anyway, that's my kind of, 2 sets on on how to survive this thing.

Awesome. Thanks, checkmate.

Appreciate your time. I know you have to drop.

Just in general, it's something I've noticed is that, you know, in bear markets, the ones who stick around to continue their education,

who try and, like, understand how Bitcoin works and be humble enough to realize that we never fully understand these things and we're just constantly improving.

That's where the conviction's built. I mean, that my conviction was always built in bear markets.

Bull markets are just for noise and,

celebration and shitposts, and then the bear markets are where you actually

build your conviction.

So, a strange one, actually, maybe you guys have an answer to this, but,

I was telling myself during the bull

how much I absolutely despise bull market rhetoric. Like, the the bull markets are just absolutely heinous when it comes to the the topics that are discussed, the the amount of shit coinery that's going on, and just look at all this stuff. You're like, I just want it to be a bear market again. And, I remember Permal Nino, one of my good friends, he said, the problem with the bear market is that you want it to come during the the ball to clean up the discourse,

but then it comes and it just gets so much worse. But having now been, we're now deep in the bear market,

and even with the price down and even with all the chaos,

the amount of,

this bear market has been so much more intellectually stimulating

than the bull market was,

by an order of magnitude. So, I'm now actually gonna,

say that having experienced

2 full scale bear markets, right, from 2018 onwards and then 2022,

and, and I guess you call it 1 bull cycle.

I prefer the bear market. I prefer the the discourse. I think the people are more sane. They're more level headed, and, I think overall, it's it's I don't know. It's just superior. Curious on your thoughts. It clear it clears out the bullshit. I mean, 200 k by conference day, caps Odell, like, it was all, like, kind of, it started all as, like, a commentary on all the bullshit. And then I I will be honest that I did,

you know, get high on my own supply a little bit.

I mean, 2 days before the conference, we were trading at, like, 36 k, and I said 200 k still in play, all caps, and it got, like,

2,000 likes.

You know, like

like, that in in the bull market, it's just all

bullish shitposts,

and there's just so much noise. And then the ride or dies stick around for the bear market. Most do not.

Most get wrecked.

And, rinse and repeat.

Okay. Well, anyway, thank you, Checkmate. Dylan, I'm not letting you escape this question.

Yeah. No. Check the that was a that was a good, good riff. I I, I agree with a lot of it. No. I'm still sitting on a bunch of dry powder. I around March, I I just sell the top, and I I still have a a fat stack in cold storage.

I did sell some Bitcoin. I know that's a sin,

in the in the springtime.

It's not a sin. You can do whatever you want. No. I know. I'm just just joking.

I Repent.

Yeah. No. I I hey. I gotta repent to to to Satoshi here.

No. I've been sitting on mostly cash, and the and the thesis was that Bitcoin,

the BTC,

you know, numerator of the equation is,

can be I I my conviction has only strengthened despite, you know, trading at 16 k being 75% down from the highs.

I do have just a small a small DCA that, I actually did crank up a good bit. So I am accumulating, and I just send that to cold storage. It's not a a fat amount of my of my stack,

or of my dry powder rather. And it's it's perfectly sustainable with my income. I mean, I just feel I feel good about that. That's not even investing for me. That's saving.

Did,

did, well from, from, like, a legacy standpoint in terms of, like, trading some of these markets in terms of, equities bonds,

shorting some of this stuff.

I will say, you know, in a completely hypothetical standpoint, if I could short some of these shit coins,

I would. And, you know, if I had access to these derivative exchanges, offshore,

I would have shorted some of these things that I've posted about, but purely hypothetical, of course.

I I I guess more so, it's just,

I'm kinda just waiting. I'm I I'm plenty patient. People were people were trolling,

trolling me, trolling Bitcoin Magazine over the last, like, our our newsletter or whatever that does, like, market commentary

about, you know, saying that, we still think there's some headwinds.

And so, certainly, from, like, a a 4 year cyclical standpoint, like, the the below cost basis, like, market value to realized value below 1. So he Jack talks about the realized price, like, the average price of all holders.

That's around, like, 20 k or something. So,

it's kind of like that same that same sort of like, this is a typical bear market. Right?

I just think, well, you know, I I really wanna see how Bitcoin plays out, if, you know, we go through another risk off, period.

So, I mean, I'll do my best in terms of of, saying where the bottom is, and I'm not gonna nail it whatsoever. 15 5 could very well be that.

But even if I, you know, allocate

at at 20,000,

right, or or whatever,

is, like, my my dollars like, dollars in a weird way have have an asymmetric,

during bear markets, obviously. It's opposite in bull markets. But during a bear market, dollars have an asymmetry in Bitcoin terms, right, where, like, something can fall 50% in your purchasing power 2 x's.

So I'm just staying patient. Like, I I have have no real worry, and I honestly, like, I say this is someone that had over a 100% of my net worth in Bitcoin in 2020 and 2021.

And so so I don't feel real Is the majority

the majority,

and you can tell me to go fuck myself. Is the majority of your net worth, like, in dollars in a bank account?

No. Yeah. Go fuck yourself. No.

No. I,

yeah. I have a good amount. I have I have,

a good amount of of, Fiat,

purchasing power at the moment.

You know, paradoxes sleep in the night. Yeah. I know. It it doesn't feel it feels kinda gross, to be honest. I'm I'm sitting in a a T bill ETF with some funds, and it just feels fucking disgusting, to be honest. Wow.

But, you know, I I've been sitting there for a little bit. So,

you know, did I foresee 3 arrows and Luna and all this stuff blowing up? No.

But kind of just just staying patient,

has has served me okay. And, like, you know, is it is it a high time preference potentially? Like, I'm not I'm not in and out trading, buying, selling, buying, selling, and more so just, like,

just, holding steady, steady lads. And, you know, I I plan on once again probably going, like, absolutely aping into Bitcoin,

with everything. And if that's, you know, at 20,000 or higher, like, I I'm fine with that.

But I've, it's treated me well just to stay patient. I kinda wanna see I kinda wanna see hash rate fall off a cliff. We're already seeing that. Is that, like, 13% from the highs?

I would prefer to see some of these shit coins implode.

Who knows about the Tether Binance stuff? I I have no idea how to quantify that.

I I kinda think that we still have another

another vol volatility

explosion in legacy.

So and I understand, like, for for most people, you should just buy Bitcoin,

with a part of your disposable income

and chill.

Given my job is kind of to

to look at this stuff 10 hours a day, of which I do, I I think I may and who knows? Maybe I'm just fucking an idiot, and I have no edge whatsoever. That's totally possible. Dylan.

You're you're you're a self described ride or die freak, listened to RHR

for years. Do you remember Murad?

Yeah. Totally. Yeah. I mean Good old Murad. Get it. I yeah. I mean, I I certainly am not levering up on Bitmax. Right? So it's more so, like, I'm just I'm just, I'm just waiting to, waiting to deploy the powder,

rather than than levering up and becoming a forced seller.

You're a good friend. So

all, like, all I want for you is to end up with the most amount of Bitcoin possible.

And, like, I hope that we can be having these conversations for many years in the future

looking back.

For the ride or die freaks, they'll know that Murad has not been on

an either of my podcasts in a long time,

because he got absolutely wrecked in March 2020.

But

there was a lot

of really great RHRs before that, where we had him on. And we basically argued about trading versus staying on both stacking sets.

Well, I mean, I'm not really trading per se. I'm more so just just sitting on cash.

I mean, given most of the population, my my Bitcoin position is probably completely outsized,

and I'm fine with that.

Yep. Fair enough. But

yeah.

Is that a is that fair? I'm not trying to

I'm not trying to,

like, bully you. I'm trying to shame you into into just aping.

I'm not trying to shame you. I mean, checks, bitcoin balance is an all time high. So, I mean, I'm I'm looking at this thing, and I I see the price. I'm like, yeah. Nah. I'm good. Kate, you Kate, you stinking Australian dollars.

I just don't trust I don't trust the banks. Like, by the time like, Bitcoin is kind of a I I think most people agree at this point that Bitcoin's a macro asset.

And if we're about if we're in a global recession, potentially going into a global depression, if if we see currency start are going into hyperinflationary

phases, and they're all gonna happen before

US dollars, but I just don't trust

dollars in a bank account.

Yeah. I just I can't get my access cut off at any moment. So I'm willing to take,

you know, an 80% haircut on paper,

to just hold through it all. And that's kind of where I'm coming from it. Right?

That's that's that's one of the things that I, am debating.

And I was I was talking to Preston, and Preston just who's also been he was sitting on all of his as free cash flow for 2020,

and he he bought some at 19. He said he, like, bought 15% of his his free cash flow or whatever. And and he just sounds like such a bad said he plowed plowed everything in that 16,000 or something.

And he's like, man, I just I just these rails. Like like, am I gonna be able to access and exchange? Like, is that you know? I and and that's one of the things for me is, like, I I also agree.

It's like, I don't I don't you know, what if they're just like, oh, you know, your Fiat on ramp is is cut off? Like, that would that would probably be young kid that's crushing it on the analysis side. You're crushing it on Twitter.

Like, the day FTX,

was, like, going down and the run was happening,

Like, I just turned off my phone. I took my lady out to Jazz.

I slept beautifully that night.

Nothing had changed for me. Right? I mean, you were killing it on Twitter at the moment, but, like, where The only thing that changed is the price.

And that's that's a really important perspective. It's the only thing that's changed is the price. Right? Bitcoin is exactly the same as it's been for for many years.

Nothing changes except the price, and that price is just human perception. Right? But,

the more work you do, the more you understand that that perception is often wrong,

and, people just can't see where this whole thing is going. Right? People aren't bullish enough.

Well, Jack, I'm glad you stayed along. Aren't you just, like, 6 minutes late to your call right now? No. No. I'm, I'm I'm the driver. So I'm, I'm waiting for that moment. It's, I'll be here until I get the, signal.

Okay. Well, I mean, we've been going for 2 hours. This has been a fantastic conversation. I'm glad both the boys joined.

Let's let's just wrap up with some final thoughts. Checkmate, final thoughts.

Yeah. I think final thoughts. If I if I kinda bring it back to where I discovered Bitcoin this time last cycle. Right? So it was the first time I finally read the white paper. I went through the process of,

you know,

I've seen my portfolio again,

99999.

I found alright. I'm clearly doing something wrong.

And then I finally read the Bitcoin white paper. And from that point on and and my orange pill was listening to Pete McCormack's series on Mt. Gox

because you realize that way back in the day before Bitcoin was worth anything, really,

people were willing to go and fight tooth and nail to get any kind of ownership structure over it. So,

my advice would be to, to start learning. Right? Keep learning about about BTC. There's so much content these days that just didn't exist,

you know, even 3, 4 years ago,

you know, a a a a shameless plug, if if you are looking to kind of learn how to read these charts. Because this is the thing. Right? The the the the the meme ability of, of on chain analytics,

it's it's a blessing and a curse.

Right? But, you know, from my perspective, there's there's elements of curse there, and that is because a lot of folks who will just poke post a chart but don't give the context.

So,

what I'm trying to do and my team is trying to do is give you the context so you actually know which tool to put pick out of the box,

to answer particular questions. Right? Contextualize things, bring it all together. So keep learning, keep studying this thing, and, if you understand

the huddling in the upside and the downside,

it's just so much easier.

Yeah. During the well, thank you, Checkmate. During the bull market,

I would take,

I did it a couple times. I would take a on chain chart that Dylan posted that was bearish, and I would add a bullish caption to it, and I would tweet it out.

And then I would just send him that my engagement was higher than his.

Yeah. It was like I forgot some of the captions. Check, you've been you've been awesome with, your your your last note series, your,

all all that stuff, dude. It's, you you know, second to none, man. And I've learned a lot from you personally, so thank you,

and and keep it up. Appreciate it. Yeah.

Dylan, final thoughts.

Yeah. I mean, I,

I've never been never been,

more bullish on on Bitcoin. I my conviction is completely unchanged.

Not going anywhere.

Bitcoin's not going anywhere.

It's kinda fun to be in the eye of the storm of this thing.

And the most bullish thing about it is it's so wildly understood still. The crypto people don't get it. The macro people don't get it.

And, you know, it's been quite a vindicating,

vindicating year from a Bitcoin Mac Maximal's perspective despite the price action.

So, yeah, I mean, we're gonna run it back,

and, the world is not is not ready for what comes next. And and I have all the time in the world to to watch it unfold.

So,

yeah, appreciate you having me on, man. It's been a it's been a fun rip.

I appreciate you, Dylan. You're you've become a good friend too, so I just appreciate you in general. One last thing on on chain data.

You know,

as a privacy advocate, I would like it to become

less and less relevant if we if we do well on the privacy side.

It shouldn't it shouldn't be as valuable to people, but we we shall see.

It will still be valuable because you'll still be able to see,

macro flows of funds. So even even with privacy, you can still

aggregate that into just, you know, transaction volumes to and from certain places, but,

what you're looking for there is aggregates, not individuals. Even if you do have privacy, basically,

the only time that that, On Chain Analytics in my view will lose signals when no one's using On Chain. So until the chain stops

having any transactions in the blocks,

that's when it lose a signal. That would be bad and that would be bearish in which case.

Everyone would just be trading paper Bitcoin on exchange. Yeah. I I would love to see your bullish caption on that chart.

Fair enough. I mean, I yeah. I less valuable is what I would say. Oh, no. I'm gonna send you the most irrelevant,

unchained,

unchained chart in the world, and and I wanna see you post it. And in all caps, this is bullish.

Well, now you're crushing you're crushing me on Twitter anyway. It? What was the most irrelevant chart?

I don't even know. Just like I was just looking at, like, median transaction fees. You had one in mind that you've been, tracking that this thing's complete shit, of which there are some.

Yeah. I don't know. It would just be funny. Boys. Boys. It's been an absolute pleasure. I hope to have you both back on,

sometime soon.

I really did enjoy this. To all the freaks,

thank you again for joining us in the live chat.

Thank you for supporting the show,

whether that's through podcasting 2 point o apps or going directly to satsperminute.com

and donating through On Chain or Lightning.

You can view everything live as those donations and support come in.

We're going for radical transparency here. We're going for a value for value future. No ads, no sponsors.

Let's prove the haters wrong that you can actually,

you know, have have a show that that drives with without edits,

without ads, without sponsors, with the live interactive chat, trying to do things differently here. I do appreciate you all.

I know it's a bear market.

If you can't contribute stats,

share the show with friends and family. Subscribe on your favorite platform, whether that's any podcast app, whether that's YouTube, Twitch, Rumble,

bitcoin tv.com.

It really does help. Leaving reviews helps. All that helps. I really do appreciate you all. I know this dispatch has been a little bit different than other dispatches, but I felt like it was a very relevant topic with some great people.

I love what these boys are doing in the space. Next week, we will be going back to

heavy technical,

discussion,

on open source software. I'm gonna having the boys from Udemy,

the privacy focused lightning wallet that can run-in a web browser

on a bunch of rider dive freaks, Ben DeCarman, Paul Miller, Tony Giorgio.

They will be joining on Monday.

That is 4 PM EST, 21 100 UTC.

So definitely be back and join us. I love you all. Stay on for StackSats. Thanks, guys.

Peace. Thanks, guys. Cheers.

Alright, gents. Good rip. I gotta run.