Bank of America Broke the Law for 7 Years. Samourai Devs Got Prison. | Rabbit Hole Recap 424

0:00 You've had a dynamic where money has become freer than free. When you talk about a Fed just gone nuts, all the central banks going nuts. So it's all acting like safe haven. I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In the world of fiat currencies, Bitcoin is the victor.

0:28 I mean, that's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. We got Coinbase tonight? Yeah. You wrangled me in. I did. Thank you for filling in. I'm going to Madison Square Garden. Wait, why are you going to Madison Square Garden? I'm allowed to disclose why you're going to Madison Square Garden.

0:46 Yeah, I can disclose. We've hosted Bruce Blakeman, the Republican candidate for governor of New York State, twice at PubKey. There's a fundraiser going on at Madison Square Garden tonight to continue. It's exciting. So from the Bitcoin perspective and adjacent industries in data centers, that's my first, you know, sorry, I'm trying to cut down on this.

1:13 He has made a campaign promise to dismantle the BitLicense day one and end the three moratoriums in New York State that are pretty pernicious to our ecosystem here. There's one on Bitcoin mining, one on new data center construction, and another one on natural gas fracking. So those four would be tremendous victories.

1:34 We can get into the BitLicense one if we want to. I have opinions on that. But he just pulled pretty close. They're close to even in the polls right now, and this would be tremendous. We have Kathy in the room. Yeah, we do have Kathy. Where's Kathy? Jonathan, can you go get Kathy? can you bring her over here we want to ask her i don't know where this came from somebody somebody just like gave this to us or jerk found it like outside of a subway uh whatever he does that he's a he's kind of a a dumpster diver as a new york state resident get in here get in here You ready to lose?

2:15 Blakeman did very well in the debate, I think. It's going to be hard to unseat a Democrat incumbent at governor. But it's important. If you're listening and you care about these issues that Bruce has promised to resolve, take a look at the campaign, make your own decisions. We don't advocate or endorse anybody directly, but this would be very, at least from PubKey's perspective, I'm personally pulling for Bruce.

2:44 Because I think the symbolic victory of unwinding the BitLicense would be tremendous. It would be tremendous. Yeah. Operationally, a little bit less so, I think. Let's go through the history of this. What? BitLicense. Yeah. For people who are unaware or new to Bitcoin. Yeah. I think there's still new people coming in.

3:01 Yeah, hopefully. I think so. Well, a lot of Bitcoiners are having kids, so you got to rehash the history. BitLicense from 2014? 2014 it started. Ben Lofsky and Dana Syracuse out of the New York Department for Financial Services. This is a regulatory arm appointed. It's kind of like a self-regulating body.

3:22 So all of the big banks obviously have a say in the governance of the NYDFS, but the appointees come from the governor. And the governor has sway. They can appoint new commissioners of the NYDFS and blah, blah, blah. Ben Lofsky proposed this. It was kind of a political maneuver on his part. I think that he wanted to run for office in some capacity.

3:44 He resigned as commissioner of the NYDFS a day before the bit license went live. They were flooded with applications. They slow rolled all these applications. and I think there's only about 30 something, maybe 35 bit licenses have been issued over the, you know, from 2014 until now. Seems higher than I would imagine.

4:06 I thought it was like five. Like people are getting them. That's why I say symbolic because a lot of people that have them quite enjoy them. So, you know, it'd be nice to open it up for like Kraken, for River, of course. I would enjoy that, that regulatory mode. You have a regulatory mode. Like, and it's just around the, around the racetrack again, it's the same exact thing that the banks do. And I'm sure we'll get to Bank of America, too big to report later in the show. But yeah, so he resigned. He went into consulting. He joined the board of Ripple. He started like Ben Lofsky consulting and just helped companies acquire a bit license.

4:45 Dana Syracuse was running the office for a period of time. He left and went into law. I think he's at Perkins Cui, also helping people get bit licenses in place. But this is a really terrible framework. And I think we talked about this on a previous episode. Frontier technology does not need a brand new legal framework, in my opinion.

5:07 No this was last week This was last week yeah Data centers And this is where I think folks in AI and high compute data centers all these things I know it's Bitcoin mining is as well. But this is where that industry can look to what Bitcoiners went through with the BitLicense, state-by-state regulations, and all the hostility in mainstream media and Greenpeace and stuff like that.

5:32 We went through this a long time ago. So, yeah, it's a chance to unwind it. The executive, the governor, has executive powers to start dismantling it, can reappoint a commissioner who would be more interested in dismantling it. I think to fully demolish it, you would need it to be at the state assembly, state senate level, which is a long putt because this is where it's important.

5:58 And for people that are not even New York residents might look at this race with interest. There are lots of proposals to expand this regulatory regime or structure framework focused on Bitcoin and broader crypto to really tighten the screws and have much more oversight and control of the industry. they're looking at implementing the same tax treatment in Illinois where individual Bitcoin transactions are subject to a transfer tax flipping the civil penalties to criminal penalties for bit license infractions or whatever so there's nasty stuff and to push it in the opposite direction tremendous symbolic victory operational victory and really will blunt sort of the um states overreach here in my opinion so go bruce let's go bruce hell yeah you know i i

6:57 discovered something this week that can maybe pull liberal democrats over to a more pro business perspective i've told you about this i'm a member i'm a member at a club in philadelphia it's called the bocce club it's a i love bocce it's a it's a men's dream establishment we had our general meeting on it's an old man's game in italy yeah it's amazing we're it's getting younger i'm one of the younger gentlemen at the club and we had our general meeting on tuesday night to go over what's happening the roof needs to be fixed but yeah changing out the key fob whatever it may be um and you have the meeting they sit around drink a couple beers talk to the guys and i love it now you need little you need little cups of table wine little tiny cups of red

7:41 wine that's how you can get that there cigarette it's it's more of an irish the irish have taken over the bachi club ramen it's more we call it lawn bowling don't you no no do we the english don't call me english point being uh people from across men from across the spectrum you know and one guy came out to me very immersed in energy opened up to being a liberal democrat but does not like democratic policies on nuclear energy particularly yeah said like it's insane what what we're doing on the energy side. We need more. I walked into the data center. He was a bit skeptical. And I was like, well, we're not actually taking the energy. We're adding to it like we discussed last week. But I think here in New York, energy too is another thing. Because I saw some

8:25 clips from the debate that Hockwell and Blakeman had the other night. I don't know if that was last night or two nights ago. That was Tuesday. Energy price is a big thing. And Blakeman really leaned into the price of energy for New Yorkers year on year raised by like $4,000. Yeah. annual bill yeah so the the fracking there's a good chunk of uh new york um that has i guess what is it the marshallis shale marcellus yeah marcellus gucci gas gucci gas um and then we shot ourselves in the dick similar to how germany did uh by shutting down our nuclear plant up in indian creek or indian point yeah point yes there's a creek there too though um yeah it it's been a a completely backwards policy and it's reflected in the cost of electricity for individual homes.

9:12 A lot of the state is still getting subsidized hydro from like Niagara Falls and elsewhere. That was a big point of contention with Bitcoin miners that were going in up there, soaking up the allotment. Well, it's coming from Canada too. A lot of it comes from Canada. A capacity crunch. They shut off the float of the US first.

9:32 Yeah. Take care of themselves. So you're dependent on Canada to a certain degree. Yeah, look, depending on how the back and forth with Trump goes, maybe they actually start to wield that a little bit more aggressively. Even more of a reason to revitalize some of the nuclear activity in the state. I think it would be, I'm not sure it's possible to get Indian Point back online quickly, but a lot of studies said that it had at least 20 or 40 years left. It was shut down prematurely.

10:01 Very pretty true. You know who led the charge of that? Shame on him. RFK, Jr. Oh, that's right. Yeah, he was anti. I think it was like Ralph Nader, RFK, and there's somebody else. One of the Fondas, I think, led their life. Jane Fonda? I think so. Jamie, can you look that up? Which Fonda was it Might have been the dude Fonda But yeah that was a big deal Jim Fonda Jane or Jim Jane.

10:31 That was a big deal in the 70s, 80s. The horror of nuclear meltdowns. Nobody died. That's what my compatriot at the Bocce Club was saying. Three Mile Island really put the kibosh on things as it pertains to the nuclear proliferation in the United States. Yeah. Also, people live in Chernobyl. There are folks that never left and they have amazing longevity and the resurgence of the biodiversity in and around Chernobyl. Chernobyl was really bad. A lot of people died that were directly affected. But they were saying that massive amounts of Europe was going to be affected by this. And it's the exact opposite. But it's still viewed as this massive regional scary catastrophe, which it was, but it was pretty localized.

11:16 And then you look at Three Mile Island, and that is a big boogeyman out there. But if you look into the details of it, man, it sucks that we've lost decades of nuclear advancement. Imagine where we'd be. I want a little college fridge, like one of the little guys, like a small nuclear reactor in the backyard.

11:39 It would be perfect. They're all in the ocean. They're running our naval warships. Yeah. All right. We're going to talk about jet fuel. Is jet fuel real? Jeff fuel is real. Can it melt steel beams? That's another question. No, no, no, no. It can't fit into the wings, though. The amount of Jeff fuel you need, I'm not convinced Jeff fuel is a thing.

11:55 Anyway, keep going. Okay. About why. Somebody likes to consider himself well-versed on theories. It's a new one for me. Interesting. All right. On the Clark's dashboard. This is the Bitcoin podcast. Current price of Bitcoin, $82,390. Did you see we broke under $80,000 today and shot it back up? Yeah.

12:14 $80,000 being defended. 1,214 sats. If you sell them, you're going to get one cuck buck, but you should be buying them for one cuck buck. We're at a $1.66 trillion market cap. We're at block height 971.615. We are currently probably a day away from the difficulty adjustment. Yes, 97 blocks, looking like an upwards adjustment of 6.7%. Blocks came in at 9 minutes and 23 seconds on average.

12:40 uh clark's teeny meeny teeny weeny mempool has 1 421 transactions in it if we go over to mempool.space we'll see they have 77 518 and great time to spend bitcoin if you're looking to save on fees once that per v bite will get you into the next block right now ample ample f2 pool binance pool binance pool shutting down yeah that's hey maybe we kick off their binance pool shutting down I haven't read too much about this one. Have they given a reason why they're shutting down?

13:13 Is it just profitability or is it a consolidation? Consolidation of business practices. I think that they went out to, they're seeking $100 million for Binance US. They're going out to raise. Let's pull it up here. As part of our ongoing review of products and services, Binance will discontinue Binance pool and related services on November 10th at 7 o'clock 0700 UTC.

13:38 This includes pool savings, cloud mining, transaction accelerator, and related features. Read the full notice here. Let's see if they give a reason. Not seeing a reason. Not seeing a reason. Yeah. Just disclaimers. It's got to be profitability or they don't want to have any increased regulatory exposure to how they're tracking the funds and processing transactions, building blocks, block construction.

14:07 Yeah, no real big explainer here. What are your thoughts? How much hash rate do they have? Let's go back to mempool.space. Let's go to mining. Like nothing, yeah. They're in the other category. Yeah, but you'd have to look at a snapshot before this announcement because folks are probably just leaving now, so that's probably not the best indication of how much they were actually doing before the announcement yeah look at luxor there shout out luxor where's luxor and grown yeah that's good that's good hash rate growth right there what do you think this says about uh i'm an advisor to luxor so thank you we disclaim and disclose on this podcast what uh what are your thoughts uh it it had to either be profitability of the business or some increased attack surface

14:56 uh around you know constructing blocks not why they're doing oh yeah impact on i don't think it i don't think it matters other ones will pop up and absorb it you still have foundry and amp pool and f2 pool of just behemoths in the space you got other ones um that are a little bit more self-sovereign leaning like brains maybe you could throw ocean into that now that we're through the bip 110 mess um you know and other good service providers mara uh luxor uh in the mix i think mara's a little bit more of like an institutional provider and slipstream what happened to nfts cali did something new they bringing them back on e actually i mean look we start with some uh technical uh technical Bitcoin stuff But Kale he been beating the drum on this for the last two weeks I believe

15:43 maybe longer. But he tweeted out earlier today, five hours ago, just sold a JPEG with an embedded eCash token in the EXIF header that transports arbitrary data, point Cheval Sanders credentials on BLS12-381 while preserving transactional privacy for 21 sats. In it for the tech. And this is... Pretty good.

16:09 I'm in it for the technology. That's a collectible right there. Yeah. That's like a Pokemon card. And so I guess they found a way to embed arbitrary data in eCash tokens that is fungible and can be passed along without, I guess, conceding on privacy. assurances that exist in the blinded signature scheme with the e-cash protocols it's pretty cool pretty cool we're a little far afield did we finish with the dashboard i had a couple of points there we finished what did you want to point out uh is there an et are they tracking etfs or or liquidations here so on october 13th about 24 hours after cpi data release there was nearly a billion liquidated in a 24-hour span. Of that continuing into October 14th, ETF saw about

17:05 261 million outflow. We have an ETF tracker on the TFTC site. Actually, you can go to tftc.io slash Bitcoin dash ETF dash flows. And yeah, let's see here. Yeah. Negative 261.5 million. It's a good chunk. yesterday yeah we have uh we've seen worse but worth tracking how tied to cpi do you think that was uh or the other boogeyman in the room in terms of you know the uh security of hardware wallets which i don't really think is accountable for this yeah i would actually imagine it's more tied to the uh the neo cloud carnage that went on yesterday before we've when we talk about others so yeah i I guess if you've been following markets this week, you've heard about the decimation in Neocloud land,

17:52 CoreWeave, Nebius, Iron. I forget who else would be bucketed in there or have the biggest drawdowns. It was yesterday. It looks like they're recovering today. But basically, I think it's a combination of things. I actually had a conversation with Mel Madison that will be published on Saturday for TFTC this morning.

18:13 And he made a good point. uh basically in parallel to the carnage and right before the carnage of the the neoclouds was the release of anthropics q3 revenue which was only up i believe like 16 looks like it's leveling off actually have a picture here that we can pull up um Let me pull this up. And Melt made the point.

18:41 So yeah, you can see they reported $65 billion earlier this summer and they just reported $76.8 billion in revenue. That's only a 2% month-on-month increase. So many people are looking at that. Anthropic wanting to IPO next month and they're saying revenue growth is petering off. short Anthropic directly.

19:05 And so who would you short the NeoClouds that are hosting their compute? So that was one theory that I heard. CEO of CoreWeave lamented markets acting irrationally as most insiders or a hefty amount of insiders are just dumping the stock. Potentially, but like, you know this. Insiders dumping the stock.

19:27 Sometimes you have to like read behind the headlines where they issued RSUs that just got unlocked and you had to pay the taxes so you had to sell some. Well, they're not mutually exclusive, right? No. That thesis that you just proposed could just be accelerating the incentive of insiders to dump the RSUs or whatever.

19:49 Markets are acting irrationally. Gartner, which is an infamous short seller, which I don't think has been successful in recent years. They've released a report saying that they're shorting all these companies because if you look at the needed Moic or return on invested capital by 2032 and a lot of the debt for these neoclouds specifically is coming due.

20:14 They don't think they're going to be able to justify the CapEx expenditure. It's like $8 trillion. And with rosy predictions, they think the hyperscalers and frontier models will be able to produce something like 3.6 to 4 trillion in revenue. So you have a big gap there. On top of that, rates are going up.

20:35 If you believe that we're in a structural bear market for bonds, and in six years, rates are still going to be high and you need a refi, tens of billions of dollars of debt, your costs are going to go up, which would mean you need a higher RMB. ROIC as well. And so questions. I'm not as bearish though using the tools. I think everything's going to be okay. I think everything will be okay. The AI capital vortex that we saw throughout most of this year was so intense and probably got like, you know, pretty overheated. There's at least a deflation of that bubble happening now, whether it bursts and it's something like a far bigger calamity. I don't know if I see it slowing down to the point where there is a broader market crash,

21:22 but you're starting to see some weakening in a lot of different areas. The way that they're talking about the IPOs in October, as opposed to the way they were talking about it in August, is a meaningful difference. And I think there's a lot more caution out there than there was throughout a ridiculous summer. If you were raising for something not directly related or within the AI ecosystem, there isn't much of a chance of actually getting an investor to pay attention. No. And when I say I'm bullish, I'm bullish on AI as a trend, whether or not Anthropoc or OpenAI make it out the other end intact. I think that question is still out there, but I think the demand for compute and the productivity that these models, which are

22:05 becoming quickly commoditized, provide individuals like yourself, myself. I mean, we talk about, off-air, Thomas and I like to bond about AI a lot and how we're leveraging it at TFTC and PubKey. And I mean, it's just getting insanely good. It manages most of our relationship. I think the bond is really just AI.

22:24 Yeah. It sits in between us. Yeah. We're actually not on air right now. These are our AI avatars. on to the big story of the week that I am passionate about wrote about it yesterday in the commoner newsletter go sign up for that if you haven't already go to tftc.io I know a lot of you listening aren't signed up so go sign up but Bank of America find I'll pull up the treasury report here 1.2 billion 1.21 billion dollars the second largest bank in the United States is Bank of America, and they were fined for violations of anti-money laundering and sanctions laws. These actions include the third largest penalty in Treasury history and the largest in the office of the comptroller. So $1.21 billion. There's two fines, one from the OCC, one from

23:15 FinCEN, and then OFAC got a little nugget in there as well, but essentially for facilitating money laundering. Financial institutions are on the front lines of protecting our economic and national security, said Secretary Scott Besant. When a bank this size fails to meet its anti-money laundering and sanctions obligations, the consequences extend far beyond its own walls, exposing the entire U.S. financial system to a significant illicit finance risk.

23:46 And so, yeah. They were laundering money for the Chinese, Chinese national cartels. I'm shocked. Probably some terrorist financing in there as well. But I think the fine is... I mean, I don't like the Bank Secrecy Act. I think we need to accept that money should be fungible and free-flowing and you can try to create these KYC AML regimes, but there's always going to be cracks in the floor as is evident by this Bank of America instance.

24:14 But the fine of $1.21 billion is something like they just printed $8.1 billion. It's irrelevant. Nothing ever happens. Chud is undefeated. Yeah. Undefeated. And this is happening while Keon Rodriguez, Bill Hill are sitting in prison cells and Roman Storm is going through a retrial for the tornado cash case.

24:38 And all three of those individuals and others. Shouts of Roman Sterling off at Bitcoin Fog too. That's a bit different because that was a centralized mixer. But I think. Yeah. But he was either, you know, his defense is he was merely a user. And I guess the charges said he was basically the operator.

24:56 Yeah. But when it comes to Samurai and Tornado Cash, they created software, wallet software that was non-custodial. They didn't really have control of the flow of funds or anything. Or most importantly, never custodied or possessed their users' money. Took fees, though. It took fees, but they never possessed the money.

25:17 Right. but they were charging for a service was one of the main points, I believe that's not what they pled to they pled to without the plea deal, they would have included I believe the fee for service that would have been part of the government's case I don't think it got that far though I don't think that was part of it it was money laundering it was definitely money laundering and then also solicitation of avoiding sanctions use our products and service to avoid sanctions.

25:48 Long story short, they never cost you money. Not a lawyer. Can we can you hit us with the not a lawyer, not legal advice? Southern District of New York coming up again Yep Went to FinCEN six months before they charged Keone and Bill and asked FinCEN are these guys in MSB And FinCEN said no. They threw him in jail anyway.

26:10 Point of the matter being, it's obvious that we live in a two-tiered society here. Yeah, it certainly is depressing. And one thing that really sticks out here is, you know, before there's another, you know, before the consolidation of the banking sector, you had a lot of different options. You had a lot of different community banks, state banks, big banks, massive consolidation starting in the 80s, still kind of going on today. You can't really just shut down Bank of America. But if this was one of hundreds caught for this activity, it would have been a non-event to shut it down.

26:50 this is egregious behavior it's a slap on the wrist like it doesn't it doesn't matter and you know everybody can pat themselves on the back and government agencies get you know more budget to open up a new division or whatever um but it's uh it's silliness at the end of the day and it's uh extraordinarily um insulting i would say to the bitcoin ecosystem with what we've been charged with uh for a long time now yeah and i think their q3 quarterly profit again was 8.1 billion dollars 1.21 billion dollar fine so cost of doing business did not when numbers are this large they're not real no but the numbers are that large why are they that large i asked you a question why why are there why is their profit that large printing no they're what do you get they get their users

27:36 deposits and they just buy treasuries and they don't share the yield which was the big fight over the clarity act right and so you have this incumbent parasitic banking system that doesn't have their users best interests at heart um like if you put your money in a checking account you're not going to get any any yield in that they are obviously aiding and abetting foreign actors going against the bsa again not a fan of the bsa but rules of rules them's the rules and you are money for this business and um and they fought the clarity act hand tooth and nail the american banker's association biggest lobby in the country uh made sure that got killed and again we're not like massive stablecoin stands here but I think objectively if you're looking at

28:19 the consumer benefits of giving a consumer the option to put their money in a banking a checking account excuse me at a bank at a commercial bank or if they were able to download a stablecoin wallet hold their cash and stablecoins in that wallet and rip some of the yield that the stablecoin provider wants to share with you which tether doesn't do but others wanted to do yeah others nobody nobody stood to gain more than like a coinbase with this and that's why they were such big supporters of of clarity um it's just it's comical how uh jamie diamond jp morgan come out and say this is going to kill the community banks and the credit unions and like the little guys nobody's killed more of the little guys than jp morgan bank of america city bank and the other big

29:02 guys don't really kill them they just they slurp them up they slurp them up yep yeah go take that mortgage risk we'll be here it's it's just a bit depressing nobody really is paying attention to this i mean you know uh the freaks are paying attention to this we're paying attention to this we we we see this stuff and you bang the drum for how many years and uh you know wall street journal will put out some report about this is the biggest fine ever and like great job everybody and slap each other on the back and it's business as usual nothing ever happens unless you make it happen to get out there and you hop on the mic yeah podcast only some of our some of our bros are in jail the um i mean the other thing out of the banking world

29:52 this week is the fact that the trump administration via executive order i think sent out a search party to do some research on what was happening under the Biden administration as it pertains to the freezing out of particular businesses from the banking system. And they came out with their report yesterday, the 14th, so Wednesday, and it basically said, yeah, Operation Choke 0.2.0 was a real thing.

30:23 And the banks were preventing legitimate businesses and organizations from acquiring bank accounts. So you have J.P. Morgan, BOA, Citibank, Wells Fargo Bank, U.S. Bank, Capital One, PNC Bank, TD Bank, and BMO Bank. The OCC conducted its supervisory review in accordance with the president's executive order, guaranteeing fair access to banking for all Americans to determine whether these banks' policies or practices may have been required, encouraged, or otherwise influence banks to deny or limit access to financial services to Americans because of their political or religious beliefs or lawful business activities.

30:59 The OCC's findings show that between 2020 and September 2025, all nine banks had such policies. It's over now, though. Yes. Unless you try to super chat Fuentes. It not over What happens then It not over The same controls are still in place Are you trying to do this Huh Have you tried to do this No of course not Look I just do the clips No, and no comment on Fuentes in particular, but there are lots of instances where this is continuing.

31:32 You're just like Matt. You love to read the comments. I love to read the comments. Shout out Free Samurai from Soap Minor 1. Yeah. Best soap in a game. Soapminer.com. Use the code RHR. 10% off. I used it. Hey, Soapminer. I used it before I hopped on the train to come to New York. I had to get a shower. I had the lemongrass.

31:50 Put it on. It's great soap. Beef tallow base. So is your beard cream. My beard cream. My mustache cream. Do you have any nicotine, sir? Speaking of... Would you like some? Yes, please. Oh, thank you. Have a Lucy. All right. OCC. Chokepoint 2.0. I mean, inevitably, it took down Silvergate. Alan Lane. Shout out to Alan. Good friend.

32:09 He was on Danny's podcast. What's that called again? What Bitcoin Did. What Bitcoin Did. Do you know what? Do you know what? I'm kidding, Danny. Peter, we're kidding. But Alan's story, he's finally been able to come out and say, hey, here's what actually happened. We haven't covered this on this show because we were on our hiatus when he wrote a Substack, but they were...

32:34 Yeah, great Substack post. The only bank in history and the only bank that was in existence in 2021-22 that could have stomached a bank run of the magnitude that they did. They had a 70% run on their deposits. They structured their balance sheet in a way to be able to get everybody their cash back. And they were doing that.

32:56 And then Elizabeth Warren and what was his name? SEC chair. Gensler. Gensler. Gary. Yeah, you better shit down. Yeah. Yeah. Shout out Jonathan Melton also intimately involved with the ridiculous, ridiculous shutdown of Silvergate. And a couple of other banks got caught up in it as well. It's not over yet. And we can take a victory lap. Nick Carter covered this extensively as it was happening before it really hit. A lot of Bitcoin entrepreneurs and folks in the broader crypto space experienced it firsthand. I remember when it was going down at 1031. Silvergate went down. Yeah. And then they hit Barney Frank's bank. What was that? Signature. We were banking with Signature. I had a couple of entities banking with Signature at the time. That was not fun. No. And then. Although Signature,

33:49 to be fair, it wasn't their fault and they dealt with it very well. I think Silvergate was in a slightly better position. They still got run over. Yeah. But Signature Bank got taken behind the it on a Sunday night. Yes. They didn't even get the opportunity to try that. But yeah, but what I mean is they did as well as they could for the customers.

34:07 They did a good job. Yeah. And then First Republic shortly after that, and then of course, Silicon Valley Bank. Yep. And during that time, you had all these banks failing and coincidentally enough, all the banks that were failing were some of the few that would actually bank industry participants. Yeah.

34:25 And there was a mad dash. We literally had portfolio companies wiring money to OTC desk into Bitcoin, putting in a multi-sig to figure out what they were going to do before they could set up another bank account. Yeah, I think the First Republic one is underappreciated at how much of a dirty deal that was because they had a very robust ultra high net worth like family office, private wealth book.

34:51 And I think that that one was also largely fine and somebody just wanted it. So they took it. Yeah. Mm-hmm. Let me pass this. No. Will it come back? What? Woke's coming back. They're coming after Shane Gillis. 2.0. You want to get into Shane Gillis? Hey. That wasn't even the joke. It wasn't the joke.

35:11 It was the setup. It's just like objectively true, too. I don't know what people are freaking out about. Well, I mean, I don't think it's a new thing either. You ever see that Jane Fonda? Did your mom have the Jane Fonda workout video? No, she wasn't, no. All right. Well, look. I mean, that was the 80s.

35:27 My mom was like a teenager in the 80s. I think the workout gear has always been like that. It's always been geared towards that. The only difference is TikTok. TikTok. Yeah, and the cameras in the gym. I saw a great tweet on this. I'm going to pull up. We're going to get a little controversial right here.

35:42 But I thought this was actually a good two-layer synopsis of why this is so triggering for people. I'm on the wrong tab here. I need to go to repost. One of our leading thought leaders, leading thought leaders. Ah, X stinks these days. I can't even find it. The gist of the tweet that I'm trying to find here was essentially, like, it's not even that women are wearing scantily clad uniforms to the gym.

36:22 Here it is The only thing any guy is actually annoyed at anymore is that this is mostly just a weird power move culturally by women It would be like men walking outside ass naked Not because I want to but expressly under the pretense that if a woman reacts, then she's a pervert and gets shamed. So she has to do this weird act of averting her eyes.

36:40 The choice is the point. The power to make you have to avert your eyes as if the woman is some kind of Egyptian demigod figure from 5000 BC. You can either commit the grave sin of laying eyes on the woman while she's dressed that way, where you can effectively culturally kneel and tilt your head. That is the entire point.

36:58 And actually, if you watch the latest season of Tires, the joke was actually a bit that they included in the show where he's at the gym and he's looking at one of this and then some TikTok bro comes up and is like, why are you looking at her? Why are you looking at her? So yeah, Woke is back. It's going to get to the banks.

37:18 It's trying. It's trying to come back. I don't think it says powerful this go around. I mean, the backlash has been pretty strong, but I'm also, I'm not on Instagram. Like, I feel like you need to be on Instagram to see how effective it is. It's leaking in X. Huh? It's leaky, but it gets slapped back pretty aggressively on X.

37:34 So I'm wondering if there's just cultural echo chambers where, you know, there is much more support and well thought out points on Instagram. Not that I would know because I'm just not on Instagram. You're not on the gram? I'm not on the gram, God, no. Honey once said, keep your wife off the gram. Yeah, I agree.

37:52 That's what we do. Sticking on the bank story, the BIS wrote about it this morning. Wrote a paper. Dropped it yesterday. Basically saying that governments... Sorry, which one is this? The BIS, the Bank of International Settlements, the Central Bank of Central Banks. Is that the big boy? It's the big boy.

38:10 The absolute unit? No. Augustin Carson. He's not with the BIS anymore. Okay. He was, though. He was the head of it, yeah. Oh, the unit. I mean, he was the anthropomorphic version of the- He's like a WWE. The banking unit. Oh, God. He wouldn't be in the ring. He'd be on the sidelines. Like, yeah, get me another burger.

38:29 But they basically wrote a paper that says, money in the architecture of trust. And they said money needs to be issued by governments. That's the only way you can imbue trust in a currency. Fiat. Because you need the ability to step in and print more money when things get a little volatile. And they called out Bitcoin specifically, and they said Bitcoin cannot serve this purpose, not only because it has a stringent supply cap, but also because you can create shit coins, and that just makes it like you don't know which money to use.

38:59 And it's completely... Well, the technical definition of fiat, according to Eric Bosco, which I also agree with, is that Bitcoin is fiat currency. All currency is fiat, and is declared by somebody. That's going to enrage some freaks. but yeah I mean the critiques for the supply cap look it's just it's just you can see exactly what it is like endless inflation on one end with the creation of shit coins and endless supply but it's capped it's weak it's always weak from the BIS and the WEF yeah and they try to call out gold too they were like oh gold you're like nobody trusts that meanwhile central banks have bought a thousand tons of gold Who needs cold?

39:43 Each year for the last five years. Yeah. So the banks are attacking Bitcoin again. It's just, this actually makes me... American Heart Association. I feel like people... Beef is going to kill you. You're going to have a heart attack. Don't drive up the price of beef. I feel like people have... The banks, the banking system hasn't been attacking Bitcoin enough lately.

39:58 I feel like we haven't gotten a good fight. They like it. They know they like it. Do they? Yeah. It's awesome. Do they feel naughty that they like it? Yeah. Yeah. Yeah. And they just don't want to tell people that they like it. It was a quip, but, you know, American Heart Association, countless other ones talking about red meat, beef, high quality protein.

40:17 Don't buy that stuff. It's bad for you. It's what for dinner. At all the executives' houses, at all the founders of these organizations, it's what's for dinner. They eat eggs for breakfast too. Exactly. Eat your protein. Eat your protein, please. I think, yeah, it's important for your brain. A lot of people going crazy.

40:38 They're not eating enough protein. We talked about it last week. And we're going to be talking about it tonight on Coinbase. But the Ledger implant. Yeah, big one. It was somewhat breaking news when we were talking about it last week. It had just happened. Yeah. Yeah. Mark Karpels had just sent out the tweet.

40:53 He did that the night before. And then it was identified as, I'm blanking on the name, Crypto Billis. Crypto Billis. Out of Malaysia. And more. And more. But it looks like the European ones, they're pulling back a little bit. That was like a little too hastily. I don't know what the latest latest is, but the last the last I saw this morning, they were starting to backtrack a little bit on some of the European resellers that there was some concern over.

41:20 Lock, I think, tweeted it and then walked it back. Lothar? No, not Loth, not Jameson. I think the account was Lock, L-O-C-K-E. Anyway, where are we with this? I got a lot of texts this week, should I be worried about my ledger? I'm not talking about that ever again, sir. I got to talk about it tonight.

41:46 I got to talk about it. Diversification of custodial solutions, diversifications of entropy. If you're doing multi-sig, multi-institutional, these are safe-ish places, but there's no guarantee security anywhere. There's better forms of security. I think it's safe to say there's, if you're going to do a single SIG at size and the size, you know, is subjective.

42:16 Bitcoin Core on an air-gapped laptop, is that where you're going with? No, it's not. That's not viable for everybody. Do you have Jameson's post? I think he was on with Laura Shin recently. And the question was, is self-custody dead? And he had a very, very good response. I think Jameson and Nick from Casa have been really, really good calming elements out there for this.

42:42 But you have to accept whatever your size is your size. If you're doing a single SIG, you have to accept a certain amount of anxiety in this period that we're in until it gets really sort of flushed out of the system. I'm not finding this. I see him quote tweeting this wrench attack. Well, it was a knife attack.

43:05 I have to dig it up. I think that he was on Laura Shin. Give me a second and I'll find it. Let me see. I got Laura Shin right here. Is self-custody dying? Lopp says no. Self-custody may be slowly... ARC told Laura Shin that self-custody may be slowly dying. Lopp replied that these are rare edge cases that he has warned about for a decade.

43:35 Yeah. I mean, speaking like... The fact that it's difficult doesn't mean that it's dying. There are ways to do this, even with some of the devices. With Cold Card, if you rolled the dice and you had a seed signer for the last word and all that stuff. I will say, I had a Cold Card queue that was hooked up to my ocean mining pool count that I forgot about.

44:05 And the pool payouts were still there earlier this week. And you rolled? I don't know. You don't remember? I don't remember. One of my favorite things... I think I usually do. I usually do, but you can't know. You set the wallet up and then... One of my favorite things from the cold card fallout is when people got really into dice and you had to get the casino dice.

44:25 you have to get the right dice. That's ridiculous. You don't need the casino. Why do you need the casino dice? The regular fucking dice from like a Monopoly, if you got six of those, it'll be fine. That's what the attacker wants you to believe. Mattel? Mattel is compromised? Mattel might be. Have you seen what they're doing to Hot Wheels?

44:43 They're completely... Oh, fuck. I walked right into that. You can tell they're hurting for margin, okay? Yeah, I hear you. Anyway, stay safe out there. You definitely, if you have the time and the technical chops and you're going to go it alone, do these extra steps. I'm still going to continue to preach a diversification of solutions here on many different levels.

45:08 I think that that is the way to go. And I do think that includes maybe some ETFs, maybe some micro strategy, some strategy. I think at the very least, I mean, Lop, I mean, while I was looking for the tweet, I couldn't find that you were asking for that you read. I did see him. I mean, he's been following the $5 wrench attacks, too.

45:26 I think not only from a technical security perspective, does multi-sig make sense? Geographically distributed multi-sig makes sense, but from an operational security and physical security standpoint. I leverage geographically distributed multi-sig myself, and it's because if somebody were to come to my house, can't get access to the Bitcoin. Hopefully you make that known. But I mean, the $5 wrench attacks in Europe specifically are picking up. France, even more specifically. Stinky cheese baguettes and wrenches. It's the Moroccans. You know this. Is it the Moroccans? It's the Moroccans. It's like a Moroccan gang. Really? Yeah. So France wants a list of your cold storage. They actually want a database to help track these things. One of the reasons is a fucking database. It's the tax

46:20 returns are public after filing. They want another database to actually track these things. And I believe there was something out of Belgium as well, asking for people to disclose their public keys. Hey, let us protect you so we can bail in the system later. Yeah. It is getting attacked from all angles.

46:46 It the pincer The government taking advantage of people being worried about their security and saying hey list your cold storage addresses with us We make sure that we able to track them down And then five years down the line, we actually need some money. We fucked up our economy. Yeah. We're going to need you to send some of that Bitcoin to this address here.

47:05 So just reading a little bit about this, the French Finance Committee advanced a bill that would require people to disclose self-custody wallets holding over 100,000 euros. starting in December. That's just like one corn, one ear of corn. Almost. One and some change. In my head, it's always 100K. So it's mandated starting next year.

47:36 I'm having trouble seeing the current status of this bill, but it is advancing from what I can tell. and you know this is this is this is pretty similar to the one that's in in brussels in belgium right now um so there might be more of a ecb angle to this who's pushing this on people um the rent attacks are scary right and people can see um see these happening in the news another uh individual or family that's into this stuff or we're somewhat public or somewhat targeted maybe they were part of a data breach from like a ledger or somebody like that. These are relatively visible stories. Mainstream media likes talking about this, obviously, because it does paint us in a negative light in terms of security. But I wonder if there's more of a European central

48:30 command telling people to follow this thread so that they can get more data on somebody that holds any material amount of Bitcoin or crypto. Well, it would make a ton of sense. Their economies are in absolute disarray over there. And what's her name? Not Angela Merka, not a van der Leyen, Christine Lagarde, convicted felon, has been pushing the digital euro, not only pushing it, but like pulling forward the sort of deadline for when they want that launched.

49:00 Yeah. Because I think it's obvious that there's no demand for European bonds out there. These people are incompetent. Denmark had a massive data breach because their digital ID password for the database was just one, two, three, four, five, six. Did you see that? That happened this morning. So if you can pull up the Denmark digital ID.

49:20 Are you able to share this on screen, Jonathan? Denmark digital. Breaking. hacker accessed Denmark's national ID database with the password 123456 exposing details of 8.8 million people. Like these people shouldn't be allowed to drive. They're so stupid. It's terrifying. Will you handle your you put it on mute over there? I just did.

49:46 Give some goddamn respect for the show. Bitcoin sign guy calling me for nonsense. It was great hanging out with him. Love you Christian. The data breach in Denmark affecting 8.8 million people. They have your social security number, your age, your sex, your family relations, your physical address, your protected addresses.

50:06 And if you've had a sex change, they have that information. Oh, God. I didn't see this one. It's atrocious. What's wrong with these people? Like, you know, having that one, two, three, four, five, six needs to be made into a meme, like a Danish meme. And we host at PubKey with the WasteLice. We've done it three years in a row.

50:25 It's the Danish Christmas lunch. It's our Christmas brunch, which is a Danish tradition. We have to fold one, two, three, four, five, six into the merch or the meme. This is bad. Yeah, it's bad. So Denmark's education and digitization minister, Kristina Egelund, said, it's a deeply serious incident that I have therefore also briefed on the Danish business and digitization committee.

50:49 Together with all relevant authorities, we are in the process of mapping the full extent of the incident. It seems like everybody got got. Look, Christina, you can't be trusted with Greenland. We've already discussed this. Hand it over and we'll take care of it. It's already happening. There was another breach.

51:06 Somebody was selling data for like 1.01 Bitcoin today. Search selling 1 Bitcoin. I'm not going to get it. Let's see. Twitter search. I'm not going to find it. But there was another breach where somebody was selling data for like one Bitcoin. It was a pretty serious breach, too. Speaking of breaches, I don't think we have it on the list, but shifting gears a bit from Bitcoin and data leaks at governments, OpenAI espionage.

51:39 Yeah. Saudi National. An employee. An employee? Of OpenAI, yeah. How many spies are in these frontier models? A lot. Do you know how many spies there are in San Francisco? San Francisco 6 is a spy. That's from what I hear. Yeah, this was a nasty one. They dropped a microphone in a DOJ conference room or something like that when they were No it was an executive conference room They put a During a DOJ hearing I believe I don't know that exact detail, but basically they put a USB drive in the back of the TV in the conference room or snooping on the boardroom.

52:20 I read this too fast. The DOJ says an OpenAI employee planted a recording device in the company's executive conference room. I had the details right. I should have trusted my gut. I should have trusted you, Marcus. AI companies want all your data, and somebody wanted theirs. I mean, this is a big problem.

52:43 We're talking about existential risk, the U.S. versus China, the Middle East may be a proxy for China in this case. It's been abundantly clear that a lot of the open-weight models coming out of China are doing distillation training on the frontier models and they're releasing those models rather quickly.

53:02 How can they do that? Distillation training. Yes. Tell me. You basically use a top of the line model to train your open weight model. Ping it a bunch of times with inputs, get the outputs, train off of that, blah, blah, blah. See how they think, see how they reason. But they're doing it so quickly, one has to wonder, is there somebody in these offices basically getting this information and funneling it to the open weight model providers previously so they can spin it around rather quickly. Then you had that whole instance of the OpenAI guy. He was like murdered in his house and we don't really know what happened.

53:39 That was a suicide. Apparently he was, oh yeah, suicided in his house. He was sharing OpenAI. Don't you think that's weird? I love the Tucker Carlson, Sam Altman interview. That sounds so strange me it doesn't sound strange to you and sam's like nah i don't like something i think we've talked about this no it wasn't you that i was talking about we need we need like a steve like jensen huang is like the closest actually listened to the uh jensen interview with um brad gerstner yeah on the train off here he's incredibly eloquent incredibly inspiring yeah great jacket he's like the closest one the steve jobs that we have did you see zuckerberg trying to drink a zero proof guinness on it was zero proof good i didn't know it was zero proof all

54:21 the all that's the other thing and he's so good valley guys like i drank three guinness it's zero proof guinness they're drinking on that show that sucks and it's a set this really pisses off our producer jonathan that they're hosting this this thing uh in like just a studio that looks like a pub rather than pub key it's all fake yeah it's all simulacrum um yeah he he definitely thought the Guinness was super yucky. Look, I like Jensen a lot. I wonder if the great hope and trust that a lot of people are putting in Jensen just because there's such a lack of integrity amongst a lot of these folks, or at least they're not instilling a fair amount of confidence that they'll do the right thing and push forward with

55:10 open source. Everybody's clearly aware of how valuable it is and how important it is to continue to push open source software development. But nobody's really talking about it outside of Jensen. Everybody else just wants to get that bag. Kevin Baker is getting that bag. NVIDIA is a big reason for that. He's a big advocate for open source models. The All-In guys, to their credit, they have been as well.

55:32 And I think this industry at large, industries at large are realizing like we can't give our trade secrets to these frontier model providers. Yeah, but with the all-in guys, they're investors, right? And open source does create a tremendous pool of opportunities for investors to invest in. So it makes sense from the VC class, the private equity class, to push for open source.

55:57 You need somebody within the industry like a Jensen to actually push forward with it. I'd love to see Elon do it. I don't think it's ever going to come from Dario or Sam. but um tried to do it with olama but that model sucked so they had yeah shelved it for a bit yeah um most of zuckerberg's like open business plans what was the libra or whatever like that was supposed to be open to like every single time he tries to do something either within or adjacent to open source uh ends up not really um progressing that far did i ever told you my libra story Matt and I, it was after Bitcoin 2019, we stayed an extra day and got to play golf at the Olympic Club in San Francisco.

56:43 I don't even get to play. We played 36 holes. We played both courses. Oh, that's awesome. I didn't find out until after the fact. It was a pretty big deal. It was still. I shouldn't have wore vans on the course that day. That's hilarious. But the reason we were there is because our friend who brought us there was a Bitcoiner and we round out the foursome with somebody in Silicon Valley who was interviewing at Facebook to lead the Libra product offering.

57:10 And so we played 36 holes have a couple of transfusions a couple of their hot dog burgers they really good at Olympic Club on the course Then we get back to the clubhouse after six hours seven hours of golf and we sit down. The guy didn't bring it up for seven hours until we sat down. The guy was a little buzzed and he's like, so what do you guys think of Libra? We were just like, not going to work. He's like, this isn't going to work, dude. Don't do it.

57:39 And lo and behold, we were right. It didn't work. No. But it could work. They're just going to run the exact same. It was like a basket. It was a timing thing. It is working now. You see all these companies spinning up their own. Isn't that Circle's new thing? It's the basket of currencies that is sort of adjusting.

58:01 I forgot about that small detail. Libra wanted to be like a Banquo basket of goods. And it included sovereign debt, gold, other things, I believe. But it was a basket of currencies that would continuously be adjusting depending on how the market's performing. Yeah. Blah, blah. Yeah. To that point that I was bringing up.

58:26 No, Steve Jobs. Who's our Steve Jobs? Jensen may be the closest, but I don't trust Sam. I don't trust Dario. Zuck, he's growing on me. I'm not going to lie. but like after seeing that beer sip it's like all right he's lost five points brother look the pr company deserves a raise like his glow up his glow up after after the like you know public humiliation ritual around like covid and when he sat there pale as a robot he looks great now he's got sun he's on lake tahoe surfing i mean you like to think that he had like a come come to jesus moment was like, maybe I shouldn't have been censoring those people.

59:02 No? I don't know. Doubtful. I think it's just more of a popular opinion to have right now. I mean, on this, sticking on AI, I have it on the list too. Drew Bonsall, he was on Danny's podcast, What Bitcoin Did, earlier this week too. Do you know what Bitcoin did? It did the thing. but this isn't about that podcast it is about he quote tweeted Nikita from or previously from X earlier this week and it ties into something we discussed last week which is like the reverse engineering of all these tools that exist out there and he really dove deep into the concept of intellectual property and I just thought I wanted to bring this up and just read the tweet because I think it's a really stimulating conversation starter

59:53 intellectual property exists because it is valuable and defensible. IP is valuable because it can be sold and resold endlessly by publishers, labels, studios, networks, and most recently by tech companies. IP is defensible because the centralized telecoms and ISPs that distribute it are both wary of copyright enforcement actions and eager to participate in the revenue stream.

1:00:11 With the rise of open source money, markets, and intelligence, IP will no longer be defensible. Some AI or peer will always be willing to sell you the bytes you want for the lowest possible costs the network can bear to deliver them to you if ip is no longer defensible it will no longer be valuable then it will no longer exist so ip going out the window i mean as a lawyer yeah not not legal advice not not lawyer what are your thoughts on this uh one of the first congressional hearings that they had like at scale around ai and i think they brought like daria they brought at least New York Times, right?

1:00:50 Huh? New York Times trial? No, it was copyright. It was the publishing houses, the way they just like hack the book open so that it can like scan the pages as much as possible. And then they destroy it. And, you know, under, I forget what doctrine, fair use or something, they can basically just absorb that information and it goes into the algorithm and it's not reproducing it.

1:01:09 But they, you know, they already pretty much decimated copyright and intellectual properties broader you have patents business patents trademarks business secrets um but a lot of this the jumping the jumping off point for a lot of this was that hearing with the major publishers uh book publishers for how they were accumulating so much data to go into the fucking machine to the clanker um to then turn around and that went absolutely nowhere they went they got humiliated on Capitol Hill for a little bit.

1:01:42 Some senators defended and some, I forget if it was the House or the Senate, but some of them, through tomatoes and other ones were defending them. And then it just sort of died on the vine. It moved so quickly past that. So I don't know if we're ever really going to revisit intellectual property more broadly.

1:02:05 The Chinese never really respected that or the patent system. Like filing for a patent these days would be asinine because you have to make it publicly available. It's like, cool, that's mine now. I'm taking it. It's basically just an open source repository. Claude, go remake this. Make no mistakes. Yeah, it's pretty wild.

1:02:26 What was I going to say? It's an antiquated regime. levity break levity break oh i was gonna say before the levity break uh stefan kinsilla is uh celebrating the death of ip who he's like an austrian thought leader he's always hated ip his whole thing is like ip should never exist so in copyright realm you look at how like disney treats copyright you're able to have it for a certain amount of years and then it's public domain they have worked for decades to extend that and extend it you have lots of like beloved cartoon characters. Some like really big ones. Can you look up the cartoon characters that are supposed to enter public domain? It's like Mickey Mouse and shit. Big ones. And then other ones as well

1:03:13 are really like when you have the underpinning of patent law just completely antiquated because of the speed of the internet and now AI even, you know, dramatically faster. It doesn't really fit its initial purpose betty boop pluto we're getting pluto popeye the sailor mickey minnie mouse winnie the pooh and tigger the 1930 version of mickey uh goofy's coming up goofy dippy dog coming up in 28 donald duck and king kong in 29 snow white in 2032 so wait yeah oh man the ai videos. It's like what you were talking about with Halo.

1:03:58 But the AI videos, if the original Mickey's now in public domain, you can make them do some crazy stuff. Well, shout out to Xbox. The entire country's not going to like that one. See what Xbox did in response to all these demo mods? They basically said, brawl for it. We're going to make it easier for you to do this.

1:04:15 That's awesome. Until somebody somebody makes like a Columbine mod and they're just like, just kidding. Please don't do that. It's probably going to go. Sorry. Oh, that was too much? You think Thomas was the first one to think of that, Jonathan? God. This is my Shane Gillis moment already. Is that much more different than GTA though? No, not really.

1:04:41 It's, you know, I don't know. Come on. All right. Now you're making me nervous. All right. That might have been the palate cleanser there, but I have another one the american dream is now uh five uh 5.32 million dollars investopedia puts the lifetime cost at five we're going for a levity break here huh i thought we were going for a levity break this is hilarious no okay five point two five point three two million dollars uh and we can pair that i believe last week we talked about um you know an annual salary of uh 120 000 a year for a medium home across the united states yeah it's coming down though where in austin in austin yeah yeah i had two people this morning i mean the house that we rented when we lived there is

1:05:33 up for sale and i had two people send me the listing and it's listed for like 1.027 mil and when we moved there in 21 we had the opportunity to buy it we're like well right it was 1.55 i think so it's not like 30 cooling off yeah um market here in new york has really slowed down the rental market is out of control i think the you know purchase market has has ground to a halt and this is before they hiked rates again um so it seems like something's kind of unhealthy in the system uh we'll have to i did have some stats here on this there were some stats where the stats it's stats on um are you doing the the hootie versus the ai we will we will get to that that'll It'll be our levity break.

1:06:16 And Jonathan, you're going to need to pull that up when we do it because it is hilarious. And I did unknowingly, unwittingly make the mistake of asking for nicotine while we're live on air. The foreclosure rate going up, forbearance rate going up. I think quarter on quarter, if I recall correctly, the stats were like a 19% increase quarter on quarter for forbearance and foreclosure.

1:06:45 I bet Blackstone likes seeing that. Here it is. Fed Survey of Consumer Financial. 19.6% late on loans figure is in the PDF. So let me find this. Let me open this. Federal Reserve.gov. Loading, loading, loading. Not coming up. Clanker gave me the wrong link. But yeah, no. I mean, it's back to the K-shaped economy.

1:07:10 Who's struggling? Who's not? What's happening? and like the whole housing debate like people like oh god um there's a dislocation houses for sale on the market and actual sales and so i think you have like a boomer millennial gen z standoff which is like we're not paying for that mortgage rates are like seven seven point two five percent right now prices are still high so the millennials and the zoomers are saying boomers are going to force you to blink first and drop those prices please i think they just got a social security bump recently Yeah 3 I believe Adjusted This is like a big Fed survey, so I can't...

1:07:51 What was the number I'm looking at? I'm control F-ing. 19.6. It's only got one, so it's not in the PDF, but... Yeah. All right. Let's go to the cot second. Are we all really that different? We're all the same. Culturally, are we just all the same? I mean, nicotine doesn't get you as high as the cot that the Houthis are doing.

1:08:31 What is it, the cot? it's like a light stimulant or something i think it has like a it makes you horny too i think uh it's got a hot side effects not side effects uh what would the right the bushman's tea let's say side effects i think it's more of like a like a cocaine light yeah it's like a light stimulant AI mode my computer's not working right now we're still on DSL here on PubQ cardiovascular, increased heart rate heart palpitations, short term side effects psychological, hyperactivity excessive talkativeness, anxiety, insomnia gastrointestinal it's an appetite suppressor similar to nicotine apparently you get severely restless on the come down irritability this is like the google gemini

1:09:32 um pg version of what cod actually does all right well all right so go back to the meme that's kind of just comparing it to the tech bro affinity for mouth stuff nicotine mouth stuff it's all about disruption work chart fives and bros always recruiting. Always recruiting. Is that all we have on the list?

1:10:05 I think it might be. Let me pull. Oh, I have this. Pull this up, Jonathan. Assistant U.S. Attorney General for the National Fraud Enforcement Division says fraudsters are stealing so much money every year in America. It's more than the entire budget of the Departments of Energy, Justice Department, and the Department of Interior.

1:10:23 year combined. And they're sending the IRS after the fraudsters. So if you're a law-abiding citizen who's worried about the IRS coming after you for not reporting your $602 Venmo send, you may sleep easy next year knowing the IRS is going after the fraudsters. Or at least that's what we're being told. $105 billion stolen by fraudsters every year.

1:10:50 do not redeem do we just live in a fake a fake economy is she going back who not a chance are you talking about she's not back not a chance she's got it I'll take that back nothing ever happens Chud is undefeated he'll never die and it's all let's get this random person here pull them in no they live upstairs let's ask them I have stride The pressure's on.

1:11:21 She's going back. Look, I don't think... She needs to be denationalized and deported. What happened with the leering centers? They were caught so red-handed, it's going nowhere. They're getting investigated now. Oh, great. It's coming out this week. I love that. I love that for them. Just like the debanking stuff, like the investigation comes out.

1:11:39 Yeah, we did all that. Look the president in the eyes right now on camera. He washes the show up. Do something. Do something. All right. Strive passes Mara and offers 15%. We haven't covered that one yet. Strive is on a heater. Well, they're offering 15%. They're calling the ticker Sats. This is going to confuse people.

1:11:58 It will. Well, is it Sats or Sata? No. Oh, you're right. It's launching Sats. Okay. How does this one... How's this one differentiated from some of the other ones? I guess this is more of a stretch competitor. Let me see. to be honest about the tickers to be honest stack sets first i'm going to be humble and sex brought to you by strive 15 how this show has changed 15 fixed rate perpetual preferred stock cumulative dividends paid every business day junior to sata so yeah yeah um look they're on a terror um if you like these products this is pretty interesting is the 15 percent yield a sign of strength or warning them these are high numbers for yields or is the yield come from I have no idea obviously it the friends you make along the way yeah so I mean strives up four percent on the year that a bad chart to look at the all because it not indicative of what happens since they expect i believe right

1:13:05 um but on the day they're up four percent market like in 15 look at that um it's pretty much everything i got from my list did you exhaust yours let me pull up the other um chat network. I have, we have some powwow things at the end. Quick hits, galaxy chart from our good friend Alex Thorne. 55.1% of Bitcoin has no known owner. And Alex is saying that more than half of all Bitcoin supplies sitting in the addresses with no known attribution. Despite all the institutionalization and centralized ownership over the years, still a ton of Bitcoin, maybe, and even most, is held by individuals in self-custody. It's bullish. Despite all the self-custody fear-mongering where did we leave that um abandoned property um

1:13:53 court case in new york yeah where is that right now i haven't seen an update on that in a while it's being held up i think there was like a wyoming trust that i think there was there was some rule or ruling that came out and said what was um everybody's pretty sure it was martin Kelly but oh yeah he's in hot water again too yeah the FTC is coming up yeah can you pull up the abandoned property Bitcoin case and see if they've announced the next next team convening of the brilliant minds involved with this it's really just Alex he's pulling that up we got some software updates bull Bitcoin version 6.1 4.0 is out there shout out to the bull Bitcoin team they They also released a video on the Bitcoin jungle and Bitcoin adoption in Uvita in Costa Rica.

1:14:51 I think probably the best example of grassroots adoption of Bitcoin in the world. SeedSigner, you had those guys on earlier this week, correct? Yeah. They've got a new update out there. I highly recommend the hit that we did with Keith was fantastic. What was the gist? do we need a red team for uh hardware supply chains yeah um what are the vulnerabilities there a lot of those are coming out i mean it's kind of crazy we we spoke a couple of weeks before uh the ledger stuff hit um you know we might have to call them back on um with the new the new uh new items well i mean zach from foundation has been on this tip all week with the ledger stuff. And Foundation has been very adamant about vertically integrating their supply

1:15:38 chain on U.S. soil. And I think he brings up a good point. Yes, you can buy straight from the distributor, but what does their supply chain look like? Are they buying from Foxconn? Are they buying from South Korean? Malaysian? U.S.? Zach's been on this from the beginning. Before they founded Foundation, he was talking about this.

1:16:00 Obelisk? Yeah, Obelisk, yeah. Oh, God, what was the name of the... Grin? No, it wasn't Grin. It wasn't Grin. It was like a storage solution. There was S-T-O-R-J, and then there was another one that... Filecoin? No, it wasn't Filecoin, but it's similar. It was along the same lines. It was just like proof of storage or something like that. And then Obelisk was associated with that.

1:16:27 that. Anyway, foundation comes out. Very expensive to own the supply chain in the US. We've lost a lot of our manufacturing base and you have to accept much higher prices and maybe a degradation in quality. Right now. Right now. Right now, but we're working to bring it back. We're bringing it back. We're bringing it back. But point being, I mean, and I'm going to talk about it tonight at Coinbase. So if you're in New York, come to PubKey in an hour and 40 minutes. With Arbdout and Rob Hamilton. Yes. And people are like, oh, just buy directly from the supplier. But we already have a pretty big example within Bitcoin of that not being a foolproof solution. And it doesn't have to do with hardware

1:17:13 wallets. It has to do with ASICs with Ampleed back in 2015. Yeah, sure. He bought an AmpMiner in that era and we found out that they had Ampleed which could remotely brick the devices or divert hash rates somewhere else. Yeah. And so didn't destroy the company it did not that's what happens when you have a duopoly at the time a monopoly those boxes are too good you gotta have them they are good they are good so no i think it's a big question and then uh who can you trust out there can you trust foxconn uh it's really difficult look i i would love to see a revitalization of the uh american manufacturing supply chain for component pieces also for finished products i think foundation is doing a fantastic

1:17:55 job but there are inherent problems that we need to solve at the federal level Not necessarily federal but within the country And SeedSigners is an amazing product project And you can buy from resellers but buying a SeedSigner from somebody that assembles one for you kind of defeats the purpose. You can buy all the parts.

1:18:19 You can buy all the parts but the level of technical sophistication that you have to have, it's a gating factor. It's a filter. So I think that this was Laura Shin's question with with or the back and forth with with Jameson if it continues this way and you truly can't trust anybody and these issues are persistent even experimenting with self-custody and trying to figure out how to do it on their own which makes the custodians much more attractive right now multi multi-institution products and even if you have a guide through multi-sig it can get expensive There are cheaper options and there's folks like Arbdout working on Sigbash and AnchorWatch and Casa.

1:19:05 There are different tiers, but it's not the most inviting process to go through if you're just getting started. Well, what do you think about the old adage is Bitcoin's not for everyone, a good friend Mr. Hoddle likes to say. I agree with Mr. Hoddle. Bitcoin is for anyone. It's not for everyone. Yeah.

1:19:22 It comes with extreme ownership. Personal responsibility. I agree. But you're not going to get mass adoption at that point. And maybe mass adoption has always been an unattainable goal. But then you start thinking about our true marketing arm. Number go up and how do these things happen? The buyer of last resort.

1:19:44 The hodlers have to step up. The sat stackers have to step up. But the next generation, it gets difficult to actually onboard folks. How many you no's am I at? I don't know. Probably like 20. I don't know, you know. I mean, I've always been, I mean, I'm a big I mean guy. Yeah. I'm a big believer in Gen Alpha.

1:20:10 This is going to skip a generation. Skip a generation. It's going to take a couple generations. I just think of my boys, the oldest particularly, who eagerly does chores to earn more Bitcoin. He likes to see sats go up in the wallet that I've set up for him. For now, I did get him that Pokemon deck. He actually wants more.

1:20:29 Do you have any more? Yeah, he does. I can give you some more. Thank you. I'm a Pokemon dealer. Thank you for starting that addiction. We bought some online. They haven't arrived yet. He's asking me every day. He's like, where are they? That's how you get the fakies. Am I getting fakies? You might. You've got to buy from the right dealer.

1:20:45 I actually use the Pokemon cards to explain other concepts. It's a really good analog, and I've hooked a couple of other Bitcoiners on this that have kids. I used to be a Pokemon collector back in the day. I caught them all at one point when there was only like 150. Yeah, there's a lot more now. There's a lot more now.

1:21:07 But I don't even know which cards are rare. He opened that pack that you gave us a couple weeks ago. He's like, is this rare? I'm like, yeah. It's holographic. Yeah. super rare yeah they're all rare it's just pure joy they've got money they've got a trading card club at the library on mondays that he went to his first one oh that's awesome he like i didn't i wasn't there i was working but my wife told me she was like uh she texted me he's like mac and uh the uh our second child went as well he's got our second son our middle child went and he's only four and he's walking in he's got his binder over his shoulder and he looked at my wife he goes i'm really nervous they got worked i came back i came back from like the meeting i was at i was like oh

1:21:53 what cards did you have it's like you lost all your best cards like these kids just worked you so we're gonna we're gonna work on this it happens it's a rite of passage it is yeah he'll get there did we talk about the interoperative uh interoperator yeah inter uh interpret oh no we didn't Thank you for bringing this up.

1:22:12 Yeah. So. Neural networks are already clean. Let's end it on a positive note. This will be the last story. Everybody's worried about their AI. It's going to take our gerbs. Yeah. It's going to kill us. Skynet's here. We need to pause and give all the control to Dario and Sam. Nick Camerata, I'm not sure if that's his last name or just his name, but he is interpretability yeah see not so easy interpretability engineer at OpenAI and he sent out the suite earlier today a lot of buzz and it seems like alignment may not be as hard as previously thought and so this whole problem of alignment the worry of AI taking not only taking our jabs but taking our lives and leading to a paperclip problem where

1:23:06 It just grinds us into dust and turns us into paperclips. It's all around alignment. Can we have any confidence that if we're building these hyper-intelligent artificial beings in the digital world... we will be able to control them and align them with our interests as humans. And a lot of that problem is driven by effective altruism and Elijah, what's his name? Eliza. That guy.

1:23:35 Yudkowsky. Yudkowsky. Eliezer. Yeah, Eliezer, Yudkowsky. They're all like, it's going to kill us. And the big problem is, can we get alignment? Nick Camerata came out today and said, interpretability might be the most important One scientific problem in the world right now, as I don't think we can solve alignment if we don't know what we're building.

1:23:54 I think I have good news about it. I co-authored early work in mechanistic interpretability. OpenAI came away pessimistic because neural networks appeared to fold into arbitrary tangled knots. Years later, I started OpenAI's first large-scale automated interpretability project, finding about 2% of neurons legible with the primitive tools we had.

1:24:21 With modern agentic tools in a much closer look, the picture looks totally different. The vast majority in models, up to trillions of parameters, are legible, and their circuits beautiful. Many famous examples of tangled neurons turn out to be misunderstood The roadblocks I expected mostly aren there I now think ambitious interpretability will be solved by the time we need it most and possibly quite soon as automated scientists keep improving.

1:24:49 It may be a bitter lesson for interpretability, the simple thing at absurd scale works. So this is actually, I mean, if you read the quote tweets of this, let's see what the number one is. When Nick told me that he had some interp, this guy can't even spell it, he just abbreviated it. That guy was the worst.

1:25:06 And he told me he had some interp breakthroughs, he was underselling it. I think this may be remembered as a major moment in scientific history. News so good, even Elizier will have to lower his P-doom. We can start making alignment into a normal science. Holy shit, I think this post is the single best piece of news I've seen all year.

1:25:25 So yeah, everybody is pretty bullish on this post. And apparently this is a well-respected interpretability researcher in the AI space. So hey, maybe we're not going to be grounded to dust and turn to the paperclips. That sounds great. I don't know what the fuck we just talked about, but that sounds super duper good.

1:25:42 What would you, if you were a paperclip, what would you like to be clipping? Like what would you what what like things of paper would you like to be holding together Like an alimony agreement An alimony yeah you sicko maybe like a prenup prenup i don fucking know like it like he had like in it in adamant i feel like what if you were able to keep i feel like pope leo when they were just like this thing's a conscious being it's just like get the fuck out get out no it's not only get the fact i mean i think we talked about this last week but the fact that the anthropica I was like I will leave if he doesn't agree to give a consciousness you know I'm about to have surgery can you get the out I got a lot going on what the are you saying all right coinbase tonight anything else what's

1:26:39 going on DC this week god I don't know we've been we've been slammed in DC slammed in New York we're entering the the holiday season here we got coinbase we actually um double booked tonight so we had to unfortunately cancel on the new york dating lab um sorry to the dating lab but following coinbase we have one up what's the dating lab doing i have no idea right we have so much random stuff they're building dates in the lab uh i think it's just like dating for like engineers ai robot no i think it individuals that work as like engineers or like developers you know trying to speed date or something like that But we got Coinbase which is personally one of my favorite series that we have here followed by 1UP which is competitive storytelling

1:27:25 It's a mix of stand-up comedy and competitive storytelling. We have a ton coming up. I'm actually working on our 2027 slate of content. We're putting a lot more structure around that. And we'll be announcing some of that soon for 2027. I'm pretty sure the probability of nerd speed dating leading to a lasting relationship is very low, but Coinbase is going to ensure that it's 0%.

1:27:50 It's as close as you can get in New York City to San Francisco. All right. We'll be back next week. Hell yeah. I'm going to be here Wednesday next week. We can rip on Wednesday. I'm fine with that. I'm around. I'm going to Nashville. on Monday. Oh, yeah. You're going to learn about the Antichrist. Yeah. I'm very excited.

1:28:09 This is the last. This is part four of the Antichrist series. I didn't get to one, two, and three, but Peter Thiel talking about the Antichrist. You know, probably a little bit of AI. That's all I got. Peace of love, freaks. Goodbye.