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Hey, I'm Whitney Webb, and welcome to Unlimited Hangout.

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Over the past two episodes of this podcast, we've explored

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various aspects of the influence of the so called Paypal Mafia on

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the second presidential administration of Donald Trump.

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While we've already examined this big tech clicks ambitions

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for American governance and healthcare, we have yet to

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interrogate their ambitions for finance and currency. This for

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anyone familiar with PayPal history and their founding

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attention to create a quote, unquote, new world currency is

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arguably the longest standing and most important driving

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factor behind the Paypal Mafia's activities over the past several

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years. This is particularly true now as they have gained

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unprecedented influence over US fiscal policy during a time when

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the radical transformation of finance in both the public and

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private sectors has been openly admitted by top officials in

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government and top bankers on Wall Street, figures like former

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PayPal COO David Sacks are now leading the development of the

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government's new policies With respect to AI and

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cryptocurrencies. In doing so, Sacks played an outsized role in

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the development of the GENIUS Act, which passed Congress and

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was signed into law by the President last week. Sacks

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notably claimed in 2017 that crypto, and Bitcoin in

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particular, were fulfilling PayPal's original New World

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Currency ambitions, though, allegedly in a quote unquote

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decentralized way, as opposed to PayPal's originally intended

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goal of centralization. However, as we'll explore today, the

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system that has been developed largely by the Paypal Mafia in

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their ilk over the past two decades plus cleverly cast this

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new world currency system that unites Bitcoin with dollar

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stablecoins as quote, unquote decentralized and is less

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Orwellian than a central bank digital currency or cbdc, this

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posturing is incredibly misleading as centralization,

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and thus the fulfillment of PayPal founding intention, as

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well as Orwellian control over citizen finance would still

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occur in such a system, making the claims of decentralization

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and greater freedom merely buzzwords meant to manufacture

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the public's consent and acquiescence, given that other

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Paypal Mafia figures with ties to the government, like Elon

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Musk are seeking to turn their AI algorithms into the new

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financial operating system of the world, it has never been

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more important to understand the game plan, and not just that,

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but how far back the game plan goes and what it is intended to

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produce, Once implemented, joining me to discuss this and

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more is Mark Goodwin, the journalist who, more than anyone

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else, has detailed the PayPal mafia's long term and troubling

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ambitions for currency, cryptocurrency and financial

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surveillance. Mark is the former editor in chief of Bitcoin

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magazine, and since last year, has been writing for unlimited

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hangout. He is the author of the book The Bitcoin Dollar, as well

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as the lead author of The Chain, an Unlimited Hangout series that

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examines the incoming digital currency system and its

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architects, with a major focus on the Paypal Mafia. Thanks for

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joining me today, Mark, and welcome back to Unlimited

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Hangout. Thanks for having me, Whitney, and absolutely don't

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absolute honor. Well, it's great to have you back, Mark. So as I

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mentioned earlier in introducing you, you were the lead author on

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The Chain, which we co wrote last year, which discusses in

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great detail the ties of the Paypal Mafia to the incoming

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digital currency landscape. So maybe we should start off giving

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people a brief overview of The Chain and what it was about and

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it and the new significance it's taken on ever since the

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inauguration of Donald Trump in January of this year.

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Yeah, absolutely so, as you mentioned, been sort of on this

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beat for a minute here the first article I wrote, kind of about

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this incoming new financial system, perhaps being, you know,

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a direct product of the US government, whether through, you

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know, private cutouts, or, you know, intelligence, you know,

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interrelationships. It was in 2021 called The Bitcoin Dollar.

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Then I made a book about it, and I started the research for The

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Chain, kind of just, you know, the idea of it was just to be a

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one article, you know, investigation into Tether, which

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is the largest stablecoin issuer. By far, they have about

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160 billion US dollar stable coins. But while kind of

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researching it, I realized I. Um, you know, how, how intimate

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the Paypal Mafia was to the foundation of Tether. And so it,

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then it sort of spiraled out a little bit, looking into, okay,

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PayPal has this, you know, pretty intense connection to the

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foundation of Tether, which we'll talk about in a little

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bit. And then even further into that, the Thiel-verse sort of

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revealed itself in further readings into this system. And,

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you know, obviously it turned out to be this, you know, nearly

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100,000 word eBook about the new financial system. So, yeah, I

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mean, it's, it's been a journey, for sure. There's so much,

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there's so many elements to this that I'm very excited to get

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into with you today. But I would say, you know the why it's such

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good timing we're doing this now despite, you know this, this

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being written, you know, fall last year is that we're actually

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seeing a lot of the seeds that were sown over the last, you

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know, 10 years that this piece, you know, illustrates, we're

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really seeing them kind of come to fruition now with the GENIUS

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Act, as you just stated. And so whether or not you want to go as

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far as I did, into reading about the formalization of this, of

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this new economy, whether or not you're interested in that it's

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happening, and it's going to affect, really, the majority of

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the people on the planet, honestly, and that is the if

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they are successful in in dollarizing the world with

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stablecoins. So that was the kind of the idea of The Chain

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was to give people the knowledge to sort of prepare themselves

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for what's coming, and now that what's coming is here, so I'll

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Well, you brought up the GENIUS Act, and that's probably

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leave it there.

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one of the most current things that has recently happened in

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the space since it passed last week, and it's the start of the

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regulation of stablecoins, and I guess the full the beginning of

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the fulfillment of some campaign promises of the Trump campaign

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with respect to the cryptocurrency space. So the

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GENIUS Act is probably most succinctly described as the US

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Bill regulating stablecoins. So it may be a good idea, even

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though I believe we've done this before, when you've been on

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previously, to give a an explanation of stablecoins in

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the Trump administration's apparent plans for stablecoins.

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Yeah, totally so stablecoin is a very clever naming trick.

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Right the stable the stability in the stablecoin is this idea

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that there's a digital representation on a blockchain

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that's this tokenized dollar that is the stablecoin, and that

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it is representing one to one, a direct peg to a real world

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asset. In the vast majority of cases, it's going to be a US

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dollar. So the stable element is that it is not a volatile, you

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know, price action like we see in more of a speculative asset

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like Bitcoin or the extended cryptocurrency space, where you

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see these wild fluctuations of valuation. The stability comes

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from the fact that one Tether is equal to $1 held in a bank

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account right by these private issuers. The issue, of course,

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and the trick of this naming mechanism is that, you know,

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obviously the dollar has been anything but stable itself and

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has been hemorrhaging purchasing power. You know, it's on pace

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for the worst year in almost a century, this year, which is

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arguably by design to help with debt service. Right? The cheaper

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$1 the easier it is to pay dollar denominated debt, right?

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But of course, over the last 100 years, you know, we've seen the

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purchasing power of the dollar, you know, just be completely

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debased, you know, plus 90% so the stability aspect, the

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stablecoin name is quite a clever trick to, you know,

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basically sell this idea that the stablecoins are stable,

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when, in fact, we know they're hemorrhaging value. And then, of

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course, there's the other aspect of well, just because it's

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pegged one to one, to something in a to some real world asset,

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to some dollar reserve held by some bank, doesn't mean that the

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bank itself is stable, right? I mean, banks go under. We saw

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that quite a bit over the last few years in the in the post

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COVID economy, you know, we saw, you know, banks like Silvergate,

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Silicon Valley Bank, First Republic, you know, these, these

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California banks that were really crucial to banking the

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cryptocurrency industry at its at its onset, we saw those three

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go under. So. The very notion of the stability of a stablecoin

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is, you know, should be scrutinized. And we've seen, you

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know, when Silicon Valley Bank went under Circle, which is the

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second biggest stablecoin, that there's USDC, they held $3.3

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billion of reserves at Silicon Valley Bank. And when Silicon

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Valley Bank went under, the stablecoin de pegged, and

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instead of being a one to one, it actually went to one to 86

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cents. So we saw a pretty significant deep peg, because of

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real world asset implications, where the bank went under,

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therefore the reserves were in question, and therefore the

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stability of the dollar stablecoin also became into

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question. That's something we'll probably pick up a little bit

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later with the Silicon Valley Bank aspect, because there was a

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direct correlation to Founders Fund and Peter Thiel, the day

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before SVB collapsed, advising their clients to pull their

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deposits, as well as founders funds, you know, pulling their

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deposits, which left, you know, I think 10 customers alone had

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13 billion in deposits. 42 billion left the bank in six

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hours. So it was this very acute liquidity crisis that was

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spawned by a very small amount of people that was detailed by

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John Titus of Solari report, and Best Evidence, who really, you

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know, broke down this, this killer where whale crisis, which

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I highly recommend going to check out, which is where I

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learned that information from. So we can see that the idea of

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the stablecoin is really anything but. And then just one

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last, I think, point here of what a stablecoin is. And then

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we'll get into the GENIUS Act. It doesn't necessarily have to

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be $1 that's just the most common one by far. There's about

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$200 billion worth of US dollar stablecoins. But there, of

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course, can be other currencies, you know, Yuan, Euro

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stablecoins. There also could be, you know, commodities. There

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could be an oil stablecoin. There's actually some pretty

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popular gold backed stablecoins, where the token is actually

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representing a portion of gold, an ounce of gold, or a portion

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of an ounce of gold. So it doesn't have to be dollars, it's

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just the vast majority of them are dollars. And you can pretty

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much assume for the rest of this conversation, and generally,

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when you hear someone say stablecoins, they're referring

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to US dollar stablecoins. So as it relates to the GENIUS Act,

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the GENIUS Act, as as you said, is the, you know, the US

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basically putting guard rails for this, you know, absolutely

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booming industry. And I say that in 2020, when, you know, we saw

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the lockdowns, there was $10 billion of stablecoins. You

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know, almost all of them were Tethers. There was, there was a

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very small amount of stablecoins. That was a pretty

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small industry. Now we're, again, we're over $200 billion

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of stablecoins. And as our, you know, the head of the Treasury

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is saying, Scott Besant, you know, overnight, essentially,

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now that the state the GENIUS Act has passed, this regulation

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will unlock almost $4 trillion I believe he said, $3.7 trillion

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of demand overnight, with the passing of the GENIUS Act for

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the reserves that back these stablecoins, these this, this

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US debt, the securities that the Fed and the Treasury issue to

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create capital, generally done by a private bank. In this case,

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it's a private stablecoin issuer. So the GENIUS Act is the

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idea of it is to create guardrails for what is allowed

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to back these stablecoins. So, rather than just kind of being,

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you know, a technological, free for all, where you have, you

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know, free floating, algorithmic pegs, or, you know, some

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combination of a basket of currencies or commodities that

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back a stablecoin, the genius act, you know, the most

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important thing it does is set the guardrails for what can back

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these stablecoins. And specifically it says that it

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needs to be US Treasuries, which is how the US pays for its

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budget. It's how IT services its debt. It sells treasuries, these

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bonds that banks buy and then they make dollars in your bank

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account. So the GENIUS Act is, is very clever, very clever

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name. But the idea that basically is to, you know,

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redomicile, these stablecoin issuers, that some of them are

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not US companies, bring them all back within the regulatory

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regime of the United States and force them to, you know,

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basically buy Uncle Sam's bags. And, you know, we will get into

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The Chain a little bit here, as to, you know, the precursor to

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this bill, the GENIUS Act, was really the Gillibrand Lummis

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stablecoin bill, which was kind of the first iteration of this

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attempt of legislation which was extremely influenced. Influenced

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by a lot of the shenanigans we saw in 2022 with the FTX

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collapse, with the Terra Luna collapse, which was this

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algorithmic stablecoin. And then, of course, the banking

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collapses in 2022 and 2023 so you know, we can get into a

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little bit about the precursor to the GENIUS Act, and how many

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of the players behind the formation of Tether and PayPal

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were directly involved in the events that led to the wording

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of the Gillibrand Lummis stablecoin Bill, which in effect

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banned algorithmic stablecoins And you know, some of the FTX

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shenanigans, so that, you know, the US government would have

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better oversight over their you know, these, these capital

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creators, right? These are, these are US dollar printing

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machines, and they want to have control over them. So there's an

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extreme argument to be made, which, of course, we did, that

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the gill and brand Lummis stable coin Bill was directly

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influenced by these events that were directly caused by the same

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very players that have, you know, a huge role to play in the

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stablecoin system. So I'll leave it there for a moment.

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But, you know, we can certainly start to get into the foundation

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of Tether and and how it led to, you know, the stablecoin wars,

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as we are certainly now in,

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00:16:32,480 --> 00:16:35,240
yeah, well, you brought up FTX, and the first time you and

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I ever collaborated was in writing about, essentially, how

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a lot of the things going on at FTX around the time of its

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00:16:42,940 --> 00:16:46,420
collapse related to what you just referenced, the stablecoin

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00:16:46,420 --> 00:16:50,680
wars, as Sam bankman Fried himself put it. So there's a

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couple directions we could go. Then we could go into this

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history that you just mentioned, and how the stable how this how

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the stablecoin wars have manifested in the past, or and,

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00:17:00,720 --> 00:17:04,020
or maybe Subsequently, we could talk about how the stablecoin

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00:17:04,020 --> 00:17:09,000
wars are likely to continue being waged in the wake of the

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GENIUS Act, and who you see the key winners of that war being

253
00:17:14,760 --> 00:17:19,380
and how in their path to mass adoption by American citizens.

254
00:17:19,380 --> 00:17:22,940
So do you have a preference about where we go next?

255
00:17:23,000 --> 00:17:27,020
Well, frankly, I think it's kind of the same. You know, the

256
00:17:27,020 --> 00:17:30,620
winners are going to be the people that set up the industry,

257
00:17:30,620 --> 00:17:33,980
right? I mean, that's, you know, legislation, when we're in this

258
00:17:33,980 --> 00:17:40,540
sort of pay to play, you know, government, donor class sort of

259
00:17:40,540 --> 00:17:43,600
environment, you know, the people that set up this industry

260
00:17:44,080 --> 00:17:48,040
also set up the people that wrote the legislation, as we get

261
00:17:48,040 --> 00:17:50,800
into in The Chain here. So I think it actually probably makes

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sense to start at the history of the founding of the stablecoin

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industry, because, believe it or not, the winners of the genius

264
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Act are very likely going to be the very same people that kicked

265
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off this industry. So I'd say, let's start at the beginning.

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And I think the beginning, you know, of the stablecoin

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industry, is really the founding of PayPal, which, of course, you

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know is they're a very controversial company. Most

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people seem to sort of, you know, look at, really, the

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extended Paypal Mafia and all the things they sort of did

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after PayPal. And most people seem to kind of ignore PayPal

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00:18:30,800 --> 00:18:35,960
itself, which I think is a huge mistake as we, you know, as

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we'll see as we get into here. So you mentioned already that

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PayPal is, you know, founding motto was this idea of a new

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world currency. And as you said, the current crypto AI czar David

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00:18:48,520 --> 00:18:55,360
Sacks, who was one of the early PayPal members. He was a former

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McKinsey analyst who joined Max Levchin and Peter Thiel, pretty

278
00:19:01,740 --> 00:19:05,340
early on in the formation, alongside Reid Hoffman of

279
00:19:05,340 --> 00:19:09,480
PayPal. Those were kind of the four main guys. And Peter Thiel,

280
00:19:09,480 --> 00:19:13,200
of course, you know you've talked about extensively, and

281
00:19:13,200 --> 00:19:15,600
are one of the leading researchers on Peter Thiel and

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the extended Thiel-verse, which I believe is a phrase that you

283
00:19:19,200 --> 00:19:24,260
coined. Peter Thiel was a, is a was, and arguably, probably is

284
00:19:24,260 --> 00:19:27,020
still a currency speculator. But certainly back in the day, you

285
00:19:27,020 --> 00:19:31,640
know, Thiel Capital, the first iterations of of Thiel's money,

286
00:19:32,300 --> 00:19:35,360
and the first, you know, non institutional investor of

287
00:19:35,360 --> 00:19:38,660
PayPal, was Peter Thiel himself, using money that he made from

288
00:19:38,660 --> 00:19:44,200
doing these foreign currency trades. So, you know, he, he

289
00:19:44,200 --> 00:19:48,760
really understood the market very, very well that there was a

290
00:19:48,760 --> 00:19:52,060
lot of money to be made in the arbitrage of, you know, between

291
00:19:52,060 --> 00:19:56,260
currencies. So between, you know, the US and and the yen or

292
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the US dollar and the lira or the euro or what have. View. And

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there's a lot of money to be made during the fluctuations of

294
00:20:03,300 --> 00:20:06,360
these currencies relative to each other. Now that all of the

295
00:20:06,360 --> 00:20:10,020
currencies, you know, since 71 with with the gold window

296
00:20:10,020 --> 00:20:14,220
closing, are these fully free floating pegs. So kind of a new

297
00:20:14,220 --> 00:20:19,680
industry was born at these this, this currency speculator Cabal,

298
00:20:19,680 --> 00:20:22,340
if you will, that, you know, sort of infamously, I would say

299
00:20:22,340 --> 00:20:25,340
Soros. George Soros is probably the most famous one, but there

300
00:20:25,340 --> 00:20:27,740
were a lot of other people that did this, and Thiel was one of

301
00:20:27,740 --> 00:20:33,020
them, and he was running a currency speculation fund when

302
00:20:33,020 --> 00:20:37,280
he met Max Levchin, who came out of Illinois, who ran over to

303
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Palo Alto to go meet Peter Thiel, and pitched him with some

304
00:20:41,500 --> 00:20:46,600
ideas of starting a company. And Levchin had spent his time

305
00:20:46,960 --> 00:20:50,560
studying computer science and was a cryptographer who spent

306
00:20:50,560 --> 00:20:53,860
the majority of his time in college working on distributed

307
00:20:53,920 --> 00:20:58,720
networks and distributed systems, very ripe for the type

308
00:20:58,720 --> 00:21:02,040
of work that you know we're now seeing in the blockchain space,

309
00:21:02,640 --> 00:21:05,880
although no one ever really seems to talk about him and his

310
00:21:05,880 --> 00:21:10,740
importance to, you know, the digitizing the economy. So So

311
00:21:10,740 --> 00:21:13,860
Thiel took, you know, some money that he had made from trading

312
00:21:13,860 --> 00:21:18,240
currency and gave money to Max Levchin. And Max asked Thiel to

313
00:21:18,240 --> 00:21:22,100
be the CEO of this company. And there was a couple other names

314
00:21:22,100 --> 00:21:24,740
at first, coinfinity and some other things. But, you know,

315
00:21:24,740 --> 00:21:27,500
eventually they settled on PayPal. Eventually David Sacks

316
00:21:27,500 --> 00:21:30,320
comes in and Reid Hoffman comes in, and what started as this

317
00:21:30,320 --> 00:21:34,700
initial idea of beaming, you know, currency US dollars,

318
00:21:34,700 --> 00:21:38,720
between Palm Pilots, which was, you know, very hip at the time,

319
00:21:38,840 --> 00:21:43,240
in the late 90s, early 2000s in, specifically in the Bay Area and

320
00:21:43,540 --> 00:21:48,040
in in Silicon Valley, you know, Sacks and Hoffman came in and

321
00:21:48,040 --> 00:21:52,000
basically took these, this, this kind of nerdy idea, and went,

322
00:21:52,000 --> 00:21:56,620
Hey, instead of pay using palm pilots, why don't we use email

323
00:21:56,620 --> 00:22:00,600
addresses? And let's make this an internet based mechanism,

324
00:22:00,600 --> 00:22:04,560
rather than an infrared mechanism, you know, using palm

325
00:22:04,560 --> 00:22:09,180
pilots offline. So that idea, obviously, is has a much bigger

326
00:22:09,180 --> 00:22:15,060
user base than simply a PalmPilot, you know, the closed

327
00:22:15,060 --> 00:22:18,600
circuit infrastructure. And they were correct. And so while

328
00:22:18,600 --> 00:22:21,320
everybody talks about PayPal Mafia, nobody ever talks about

329
00:22:21,320 --> 00:22:25,640
the fact that PayPal really was the first dollarizer of the

330
00:22:25,640 --> 00:22:28,160
internet, and they really made the native currency of the

331
00:22:28,160 --> 00:22:32,540
internet the dollar. And of course, you know, when you look

332
00:22:32,540 --> 00:22:36,140
at what Max Levchin was talking about and Peter Thiel at the time

333
00:22:36,140 --> 00:22:41,440
of founding PayPal, you know they were heavily influenced and

334
00:22:41,440 --> 00:22:45,580
working very closely with, I believe, Levchin says every

335
00:22:45,940 --> 00:22:49,960
alphabet letter three and four letter agency that would talk to

336
00:22:49,960 --> 00:22:53,320
them, and you know, they worked very closely with the NSA. In

337
00:22:53,320 --> 00:22:57,220
fact, Levchin had applied for the NSA, and they said, No,

338
00:22:57,220 --> 00:22:59,680
buddy, don't come here. You won't make a dime. Go to the

339
00:22:59,680 --> 00:23:03,960
private sector. And you know, you'll, you'll have good success

340
00:23:03,960 --> 00:23:07,260
there using cryptography for the betterment of the country. So

341
00:23:07,380 --> 00:23:10,500
that was when he ran into Thiel and started PayPal, very

342
00:23:10,500 --> 00:23:13,320
conveniently, right after being denied by the NSA, he gets

343
00:23:13,320 --> 00:23:16,500
connected with Peter Thiel. And so PayPal, you know, took this

344
00:23:16,500 --> 00:23:20,780
idea of, how do we dollarize the internet, and they use

345
00:23:20,780 --> 00:23:24,980
cryptography and a lot of these kind of ideas that we see

346
00:23:24,980 --> 00:23:28,880
everywhere on the internet, like capture, you know, was actually

347
00:23:28,940 --> 00:23:32,060
the first commercial use of it was, was on PayPal, you know,

348
00:23:32,060 --> 00:23:35,960
dollarizing, digitizing. The dollar has a lot of technical

349
00:23:36,380 --> 00:23:40,100
handshakes and very specific things that you know, need to be

350
00:23:40,100 --> 00:23:45,100
done. And they were really the first people to solve it. So a

351
00:23:45,100 --> 00:23:49,420
very illuminating book that I suggest people check out. It's

352
00:23:49,420 --> 00:23:52,180
called the PayPal wars, and it was written by an early

353
00:23:52,180 --> 00:23:56,680
marketing advisor there at PayPal, one of the first 20

354
00:23:56,680 --> 00:24:00,900
employees. And he talks about a meeting very early on that Thiel

355
00:24:00,900 --> 00:24:03,840
gave as sort of a board meeting that he, you know, he talked to

356
00:24:03,840 --> 00:24:06,720
everybody there in their small, little office at the time, and

357
00:24:06,720 --> 00:24:09,600
kind of explained, you know, what the overall vision of

358
00:24:09,600 --> 00:24:12,840
PayPal was. And he wasn't quite using the new world currency

359
00:24:12,840 --> 00:24:17,940
angle yet, but he had this idea of understanding that, you know,

360
00:24:18,240 --> 00:24:22,160
using technology, they can really circumnavigate the

361
00:24:22,160 --> 00:24:28,940
controls of political power and capital controls that central

362
00:24:28,940 --> 00:24:31,940
banks around the world, the 180 or so central banks around the

363
00:24:31,940 --> 00:24:34,700
world, have over their local citizens, and Thiel very

364
00:24:34,700 --> 00:24:38,480
specifically said, if we can give people access to dollars

365
00:24:38,480 --> 00:24:43,060
using PayPal, we can free the world from Central Bank tyranny,

366
00:24:43,480 --> 00:24:47,620
and we can free these, you know, these users that are stuck in,

367
00:24:47,860 --> 00:24:51,160
you know, Argentine pesos, or whatever, they can now have

368
00:24:51,160 --> 00:24:55,540
access to the dollars through this technological innovation.

369
00:24:55,900 --> 00:24:59,920
And we can really defang central banks across the world and get.

370
00:25:00,000 --> 00:25:03,840
People out from the enslavement of central banks. Of course,

371
00:25:04,380 --> 00:25:07,380
that is, you know, it sounds great, right? Central banks, not

372
00:25:07,380 --> 00:25:11,040
good. No one is championing the central banks here. But of

373
00:25:11,040 --> 00:25:15,480
course, you know that, does it actually get us out of control

374
00:25:15,480 --> 00:25:18,480
over the central banks, or does it centralize control to the

375
00:25:18,480 --> 00:25:22,340
United States central bank to the Federal Reserve, yeah, and

376
00:25:22,340 --> 00:25:25,340
so, of course, it does, putting everybody onto the dollar

377
00:25:25,340 --> 00:25:29,840
system, you know, really empowers the Fed. So you could

378
00:25:29,840 --> 00:25:33,260
argue that, you know, maybe these guys who were working with

379
00:25:33,260 --> 00:25:36,020
intelligence, who understood technology was where things were

380
00:25:36,020 --> 00:25:39,620
going, and understood the, you know, the currency speculation

381
00:25:39,620 --> 00:25:43,000
game, you know, maybe these guys that are telling us they want to

382
00:25:43,000 --> 00:25:46,660
create a new world currency, maybe they actually did. And you

383
00:25:46,660 --> 00:25:48,880
could argue that they were involved in the creation of

384
00:25:48,880 --> 00:25:52,180
blockchain and a Bitcoin, but that can't be proven, but you

385
00:25:52,180 --> 00:25:55,900
certainly can make their connections to the stablecoin

386
00:25:55,900 --> 00:25:59,560
industry and the creation of Tether specifically, which was

387
00:25:59,560 --> 00:26:01,800
the first stablecoin that really came up with this idea.

388
00:26:01,800 --> 00:26:04,620
And when you look at the founding of Tether, Brock

389
00:26:04,620 --> 00:26:09,240
Pierce, who was the founder of Tether, has numerous connections

390
00:26:09,240 --> 00:26:13,440
to early PayPal people, including Goldman Sachs, which

391
00:26:13,440 --> 00:26:16,860
was one of the first investors of PayPal, and IDEA Lab, which

392
00:26:16,860 --> 00:26:20,040
is this incubator that came out of California, run by Bill

393
00:26:20,040 --> 00:26:24,500
Gross, which, you know, they were the first institutional

394
00:26:24,500 --> 00:26:28,220
investors in Paypal, after Thiel gave the million dollars from

395
00:26:28,220 --> 00:26:31,280
his hedge fund to start PayPal with Levchin, their first

396
00:26:31,280 --> 00:26:35,420
investor was Idealab, this incubator, and Goldman followed

397
00:26:35,480 --> 00:26:39,920
really closely and Brock Pierce, who has a very controversial

398
00:26:39,920 --> 00:26:45,580
figure and has some connections to some really unfortunate

399
00:26:45,820 --> 00:26:52,180
things. He was a the biggest PayPal merchant for three years.

400
00:26:52,300 --> 00:26:54,640
He basically invented the

401
00:26:55,900 --> 00:27:00,660
credit card industry for PayPal. He was, he was the number one

402
00:27:00,660 --> 00:27:04,380
person there, yeah, as I said, he was their biggest customer

403
00:27:04,380 --> 00:27:07,920
for three years. He was on their advisory board, and then he

404
00:27:07,920 --> 00:27:13,020
ended up starting a fund with IDEA Lab, spin off clear stone

405
00:27:13,020 --> 00:27:17,100
ventures, about a digital gaming fund, because they were the

406
00:27:17,520 --> 00:27:22,400
people that were really starting the virtual securities industry,

407
00:27:22,460 --> 00:27:26,600
the digital goods industry, using gold and items from, you

408
00:27:26,600 --> 00:27:30,860
know, these massively multiplayer online RPGs, you

409
00:27:30,860 --> 00:27:34,460
know, like World of Warcraft, these guys were selling gold and

410
00:27:34,460 --> 00:27:37,160
creating understanding. There was a market for digital

411
00:27:37,160 --> 00:27:40,300
commodities. And Brock Pierce was the guy that that really

412
00:27:40,300 --> 00:27:45,520
started that. And he was given a lot of funding and a lot of

413
00:27:45,520 --> 00:27:50,140
support from the very people that started PayPal. And very

414
00:27:50,140 --> 00:27:54,820
interestingly, as it connects to sort of the the Epstein network,

415
00:27:55,600 --> 00:28:00,460
Bill elkus, who, you know, was the head investor of PayPal for

416
00:28:00,460 --> 00:28:04,500
IDEA labs who ran clearstone When it spun off. He was one of

417
00:28:04,500 --> 00:28:09,780
the trustees of the Jay Epstein Foundation. And you know, the

418
00:28:10,200 --> 00:28:13,860
Brock Pierce himself has connections to Epstein through

419
00:28:13,860 --> 00:28:18,120
the mind conference. And you know, you can kind of start to

420
00:28:18,120 --> 00:28:23,420
see how this speculative currency cabal and technologists

421
00:28:23,420 --> 00:28:28,580
were kind of coming together to build a system as Brock Pierce

422
00:28:28,580 --> 00:28:31,820
claims, you know, I'm not here to fight the system. I'm here to

423
00:28:31,820 --> 00:28:35,420
build a new system for when it collapses. I am the plan B, you

424
00:28:35,420 --> 00:28:38,060
know, that was, that was a quote that he said that we found while

425
00:28:38,060 --> 00:28:40,960
doing The Chain. So you begin to kind of look at, oh, wow. The

426
00:28:40,960 --> 00:28:45,700
Digital Goods space is directly connected with the people that

427
00:28:45,700 --> 00:28:51,880
started PayPal and and, you know this, the this whole kind of

428
00:28:51,880 --> 00:28:57,640
Tether idea is really sold in the exact same way that Thiel was

429
00:28:57,640 --> 00:29:02,040
selling PayPal in the early 2000s as this altruistic way to

430
00:29:02,040 --> 00:29:06,180
get people out from the tyranny of central banking, by banking

431
00:29:06,240 --> 00:29:08,820
the unbanked, giving them dollar access. That's exactly what

432
00:29:08,820 --> 00:29:15,420
Tether is selling itself as today and in 2025 so perhaps,

433
00:29:15,420 --> 00:29:19,680
maybe these things aren't an accident and just, you know, fun

434
00:29:19,680 --> 00:29:23,540
market forces coming together, perhaps this is a really clever

435
00:29:23,540 --> 00:29:27,860
way to build the new economy and create this plan B, knowing that

436
00:29:27,860 --> 00:29:33,320
the economy was going to have serious issues, as we've noted

437
00:29:33,320 --> 00:29:36,800
before, Bitcoin comes out of the OA crash, which you could

438
00:29:36,860 --> 00:29:40,480
directly connect to some of the players in the Epstein Network,

439
00:29:40,480 --> 00:29:43,480
and with Goldman and Bear Stearns and some of these people

440
00:29:43,480 --> 00:29:48,340
that were doing these crazy debt obligation plays. And then, of

441
00:29:48,340 --> 00:29:52,780
course, we have 2020, which occurs under Trump, which was a

442
00:29:53,500 --> 00:29:57,520
controlled demolition of the economy that really led into the

443
00:29:57,640 --> 00:30:01,380
boom of stablecoins, in the boom of. Bitcoin that Trump

444
00:30:01,380 --> 00:30:05,700
really set up on his final days of office, on his way out, you

445
00:30:05,700 --> 00:30:08,880
know, really let the banking industry have the first

446
00:30:08,880 --> 00:30:11,940
iterations of clear legislation that allowed them to play in

447
00:30:11,940 --> 00:30:16,020
this market. So I've been ranting for a little bit here,

448
00:30:16,020 --> 00:30:18,420
and I'll let you I'll let you pop in here. But I think one

449
00:30:18,420 --> 00:30:21,320
more really interesting connection between these groups

450
00:30:21,620 --> 00:30:25,340
is the fact that Brock Pierce, when he was starting IgE, this

451
00:30:26,120 --> 00:30:29,540
the the gaming company, the digital goods company that he

452
00:30:29,540 --> 00:30:33,140
started, it ended up being taken over by Goldman. And in fact,

453
00:30:33,140 --> 00:30:37,040
Steve Bannon became the CEO of the company when Brock Pierce

454
00:30:37,040 --> 00:30:40,360
left. And interestingly, of course, Bannon becomes, you

455
00:30:40,360 --> 00:30:44,560
know, a very large political advisor to Trump who also has

456
00:30:44,560 --> 00:30:48,340
extreme connections to Epstein, who, you know, he's spent about

457
00:30:48,340 --> 00:30:52,240
15 hours interviewing Epstein as an attempt to rehabilitate his

458
00:30:52,240 --> 00:31:00,040
image. But Goldman and and Bannon and Pierce, you know, all

459
00:31:00,040 --> 00:31:03,840
had a ton of connections in the first Trump administration, via

460
00:31:03,840 --> 00:31:08,400
Steve Mnuchin, who ran, you know, the Treasury at the time,

461
00:31:09,600 --> 00:31:15,600
and they really set up the whole stablecoin industry as it's

462
00:31:15,600 --> 00:31:16,920
coming to fruition today.

463
00:31:17,640 --> 00:31:20,160
Well, thanks for that. Definitely a lot of information,

464
00:31:20,160 --> 00:31:22,940
of course, if you want even more detail than the detailed

465
00:31:22,940 --> 00:31:27,200
explanation mark just gave, you can revisit The Chain series.

466
00:31:27,800 --> 00:31:31,280
But I think is since we had mentioned earlier, FTX, now

467
00:31:31,280 --> 00:31:34,460
might be a good time to sort of get into the relationship of

468
00:31:34,460 --> 00:31:38,420
Tether and FTX in that phase of the stablecoin war, in part,

469
00:31:38,420 --> 00:31:42,160
because when FTX collapsed, you know, all the blame was really

470
00:31:42,160 --> 00:31:45,880
placed on Sam bankman, fried Caroline, Ellison and some of

471
00:31:45,880 --> 00:31:51,280
these other top executives at FTX. But somehow Tether emerged

472
00:31:51,280 --> 00:31:56,560
from that scandal pretty much unscathed, despite the fact that

473
00:31:56,680 --> 00:32:01,080
a lot they had a lot of dubious connections to some of the

474
00:32:01,080 --> 00:32:04,260
criminal activity, or alleged criminal activity, that was

475
00:32:04,260 --> 00:32:08,820
going on at FTX at the time of its collapse. And also, you know

476
00:32:08,880 --> 00:32:11,940
FTX as Mark, and I have previous or you and I have previously

477
00:32:11,940 --> 00:32:18,120
reported, was in its own efforts to develop a competing dollar

478
00:32:18,120 --> 00:32:22,640
stablecoin to Tether, presumably with this company

479
00:32:22,640 --> 00:32:28,100
called fluent finance shortly before it imploded. So some of

480
00:32:28,100 --> 00:32:31,640
that might be interesting to explore. And of course, not that

481
00:32:31,640 --> 00:32:35,720
long after FTX, we have the scandal you alluded to earlier,

482
00:32:35,720 --> 00:32:39,140
of silicon the scandalous collapse, rather of Silicon

483
00:32:39,140 --> 00:32:41,620
Valley Bank, even though a lot of people don't view it as a

484
00:32:41,620 --> 00:32:45,220
scandalous collapse. When you consider what you mentioned

485
00:32:45,220 --> 00:32:49,660
earlier, citing John Titus work and also Peter thiel's role in

486
00:32:49,660 --> 00:32:54,580
creating that liquidity crisis, it certainly looks like another

487
00:32:54,580 --> 00:32:59,020
iteration of this broader war, covert war, going on behind the

488
00:32:59,020 --> 00:33:02,880
scenes. It does just sort of King make who will rule over

489
00:33:03,060 --> 00:33:05,820
the, you know, incoming digital currency era?

490
00:33:06,900 --> 00:33:11,820
Yeah, totally. So I think the FTX itself is really the

491
00:33:11,820 --> 00:33:17,760
perfect example of how private interests can create. I don't

492
00:33:17,760 --> 00:33:20,960
want to say false flag, because it, of course, it did happen. I

493
00:33:20,960 --> 00:33:24,380
mean, this was a real event, and a lot of people did get very

494
00:33:24,380 --> 00:33:28,220
hurt in the bankruptcy of FTX. It was a very large exchange,

495
00:33:28,400 --> 00:33:31,040
but it's a really good example of how private entities can

496
00:33:31,040 --> 00:33:36,980
create, you know, events in the markets that directly influence

497
00:33:36,980 --> 00:33:42,280
legislation and basically have people, you know running to

498
00:33:42,280 --> 00:33:46,120
their local representatives demanding, you know, certain

499
00:33:46,120 --> 00:33:50,440
legislations get put in that are really actually for the

500
00:33:50,440 --> 00:33:54,400
betterment of the private sector interests that actually caused

501
00:33:54,400 --> 00:33:59,200
the event in the first place. So Sam bankman, fried is a very

502
00:33:59,200 --> 00:34:03,240
curious character, which we get into quite a bit here, in the

503
00:34:03,240 --> 00:34:06,720
third piece of The Chain, the chain of consensus. And we kind

504
00:34:06,720 --> 00:34:11,160
of go over the stablecoin war, but, yeah, you really can't

505
00:34:11,280 --> 00:34:15,780
separate the wording in the legislation that exists today,

506
00:34:15,780 --> 00:34:19,080
in the GENIUS Act, from the events that occurred, you know,

507
00:34:19,080 --> 00:34:22,880
in this, you know, I guess the second stablecoin war. We're

508
00:34:23,060 --> 00:34:28,580
about to see the third, as the, you know, the players post the

509
00:34:28,580 --> 00:34:33,740
GENIUS Act fight for market share. But the second one really

510
00:34:33,740 --> 00:34:39,080
is this, FTX, Terra Luna, Tether, USDC, fight that

511
00:34:39,080 --> 00:34:45,280
occurred in 2022 and 2023 so but specifically, I think, as you

512
00:34:45,280 --> 00:34:50,800
mentioned, you know, FTX had this in house hedge fund, this

513
00:34:50,800 --> 00:34:54,160
trading desk, well, I guess, technically outhouse, but they

514
00:34:54,160 --> 00:34:56,800
were, they were intimately connected, and ultimately their

515
00:34:56,800 --> 00:35:00,660
intimacy led to the collapse of FTX. But this. Trading Desk

516
00:35:00,660 --> 00:35:04,320
known as Alameda research, which was actually Tethers, second

517
00:35:04,320 --> 00:35:12,180
largest customer, which had, you know, over $30 billion of

518
00:35:12,180 --> 00:35:15,840
Tethers issued directly to Alameda research, which, at the

519
00:35:15,840 --> 00:35:21,620
time was was, was nearly the lion's share of usdt that had

520
00:35:21,620 --> 00:35:25,700
been issued by the company. So once again, to go back to stable

521
00:35:25,700 --> 00:35:29,960
coins, to have $30 billion of Tether sloshing back and forth

522
00:35:29,960 --> 00:35:34,640
between Alameda and and Heather, the issuer, the company that

523
00:35:34,640 --> 00:35:42,160
issues usdt, you know, you have to also have the $30 billion of

524
00:35:42,760 --> 00:35:47,440
treasuries or of dollars moving in the traditional industry. And

525
00:35:47,440 --> 00:35:51,040
there's, it's really hard to kind of see that paper trail why

526
00:35:51,040 --> 00:35:53,740
they were issuing so much Tethers and why they were going

527
00:35:53,740 --> 00:35:58,780
to FTX. But what ended up happening that actually took out

528
00:35:58,840 --> 00:36:04,140
FTX, excuse me, it was directly connected to the collapse of an

529
00:36:04,140 --> 00:36:09,660
algorithmic stablecoin called Terra Luna, which was set up by

530
00:36:09,660 --> 00:36:13,920
do Quan, who had previously set up an algorithmic stablecoin

531
00:36:14,040 --> 00:36:18,180
that had also collapsed years before. But Terra Luna was

532
00:36:18,180 --> 00:36:22,520
really, was really, really a big deal. It was, it was extremely

533
00:36:22,520 --> 00:36:25,520
popular. It was really globalized. It was very big in

534
00:36:25,520 --> 00:36:30,740
South America, mostly because it gave dollar access, right? It

535
00:36:30,740 --> 00:36:35,780
gave you access to dollars, but more so it gave you access to a

536
00:36:35,780 --> 00:36:39,740
yield bearing dollar. So people threw tons and tons and tons of

537
00:36:39,740 --> 00:36:42,940
money. I mean, it blew up into, you know, an extremely large

538
00:36:42,940 --> 00:36:47,740
market, and majority because people saw that they could earn

539
00:36:48,520 --> 00:36:53,920
using this protocol that was native to Terra Luna, you know,

540
00:36:53,920 --> 00:36:59,020
almost 20% at times of yield in a year by keeping their funds In

541
00:36:59,020 --> 00:37:03,960
Terra Luna, which is extremely significant. I mean, 20% is an

542
00:37:03,960 --> 00:37:08,760
absurd amount of yield for just keeping your money parked

543
00:37:08,760 --> 00:37:12,420
somewhere. Of course, anytime you see there's no such thing as

544
00:37:12,420 --> 00:37:15,720
free lunch in markets, and naturally, that yield blew up

545
00:37:15,720 --> 00:37:19,320
because it was completely unsustainable. But Terra Luna

546
00:37:19,320 --> 00:37:23,060
blew up because there was a program that was built on its

547
00:37:23,060 --> 00:37:27,440
protocol, called the anchor protocol, that was designed by a

548
00:37:27,440 --> 00:37:31,520
South Korean named Ryan Park, who was actually awarded a Thiel

549
00:37:31,520 --> 00:37:36,860
fellowship to build out this product that was a 20% yield

550
00:37:36,860 --> 00:37:39,980
bearing dollar instrument on Terra Luna, which caused this

551
00:37:39,980 --> 00:37:46,180
humongous bubble to occur within the protocol of Terra Luna, and

552
00:37:46,180 --> 00:37:50,260
ended up leading to a capital flight. Once the yield could no

553
00:37:50,260 --> 00:37:53,800
longer be held. It was a completely unsustainable thing

554
00:37:53,800 --> 00:37:57,700
to pay everybody 20% to keep their money in this, locked up,

555
00:37:57,700 --> 00:38:01,080
in this, in this algorithm. So once everybody realized that

556
00:38:01,080 --> 00:38:04,380
they couldn't pay. Everybody started to pull their money out.

557
00:38:04,380 --> 00:38:07,320
And it ran. It basically created what is, you know, in the

558
00:38:07,320 --> 00:38:10,920
traditional finance world, known as a bank run. But in this case,

559
00:38:10,920 --> 00:38:14,280
it was an algorithmic de pegging. And, you know, 33,000

560
00:38:15,120 --> 00:38:21,920
Bitcoin were liquidated from Terra Luna onto binance, which

561
00:38:21,920 --> 00:38:25,400
was which is run by cz who was given his first job in the

562
00:38:25,400 --> 00:38:29,120
crypto industry by Brock Pierce, interestingly enough, but Terra

563
00:38:29,120 --> 00:38:32,300
Luna was directly competing with the other stablecoin providers,

564
00:38:32,600 --> 00:38:35,540
and they were doing a unique thing, where instead of backing

565
00:38:35,840 --> 00:38:39,980
their stablecoin with treasuries or Uncle Sam's debt,

566
00:38:40,400 --> 00:38:46,960
they were actually backing it with Bitcoin. And so Thiel gives

567
00:38:46,960 --> 00:38:51,160
money to this guy, Ryan park, to create this protocol on Terra

568
00:38:51,160 --> 00:38:55,420
Luna, which pops the whole industry. And unfortunately for

569
00:38:55,420 --> 00:38:58,840
FTX and its customers, the liquidity issues that came from

570
00:38:58,840 --> 00:39:06,360
FTX and Alameda holding a bunch of this, the protocols token,

571
00:39:06,360 --> 00:39:10,200
they ended up having huge balance sheet issues because of

572
00:39:10,200 --> 00:39:12,360
the collapse of Terra Luna, which was the Controlled

573
00:39:12,360 --> 00:39:17,400
Demolition done at the behest of, you know, you could argue,

574
00:39:17,400 --> 00:39:21,860
of Peter Thiel, who has, You know, outsized interest in US

575
00:39:21,860 --> 00:39:24,920
debt back stablecoins winning, rather than algorithmic stable

576
00:39:24,920 --> 00:39:27,920
coins winning. And so FTX ended up having a huge hole in their

577
00:39:27,920 --> 00:39:31,220
balance sheet, and they tried to fill it with FTT, which was

578
00:39:31,220 --> 00:39:35,480
their token that they issued for FTX. And then, of course,

579
00:39:35,480 --> 00:39:41,140
CoinDesk, Ian Allison ended up publishing the balance sheet of

580
00:39:41,140 --> 00:39:44,620
Alameda research and FTX, and noticed that, you know, they

581
00:39:44,620 --> 00:39:48,340
were holding this outsized portion of all of FTX funds on

582
00:39:48,400 --> 00:39:51,880
basically, you know, it's essentially the same company,

583
00:39:51,880 --> 00:39:54,520
just divided. It's a shell company, essentially. And they

584
00:39:54,520 --> 00:39:57,280
realized that, you know, there was a completely unsustainable

585
00:39:57,280 --> 00:39:59,920
thing, and that this FTX was essentially installed.

586
00:40:01,620 --> 00:40:04,440
Investment, and they held the majority of their capital within

587
00:40:04,440 --> 00:40:07,440
their own token that they printed. And once that came out,

588
00:40:08,040 --> 00:40:10,440
there was a huge bank run at FTX, and the whole thing

589
00:40:10,440 --> 00:40:14,520
collapsed overnight. Very interestingly, I think it was

590
00:40:14,520 --> 00:40:18,900
two days before FTX collapsed. Sam bankman Fried went on a

591
00:40:18,900 --> 00:40:21,740
podcast and talked about how he was going to create a stable

592
00:40:21,740 --> 00:40:24,680
coin, which, of course, you and I investigated in the fluid

593
00:40:24,680 --> 00:40:27,800
finance piece, but he's coming out saying he's going to start

594
00:40:27,800 --> 00:40:31,520
his own stablecoin. There. They were intimately invested in

595
00:40:31,520 --> 00:40:36,560
terra Luna, and had a lot of you know, interest in that

596
00:40:36,560 --> 00:40:40,600
algorithmic back stablecoin working for whatever reason.

597
00:40:40,600 --> 00:40:43,780
Again, I think it's very, very possible it's very related to

598
00:40:43,780 --> 00:40:48,220
Thiel and the Tether and the stablecoin folks that held

599
00:40:48,220 --> 00:40:50,920
government backed stablecoins, government debt backed stable

600
00:40:50,920 --> 00:40:55,060
coins, and this industry of algorithmic stablecoins

601
00:40:55,120 --> 00:41:01,740
implodes very publicly and leads to direct language in the first

602
00:41:01,740 --> 00:41:04,260
iteration of the stablecoin bill, the gillenbrand Lummis

603
00:41:04,260 --> 00:41:09,480
bill that says we are banning algorithmic alter alternatives

604
00:41:10,860 --> 00:41:16,860
versus US debt backed stable coins. And gillenbrand said

605
00:41:16,860 --> 00:41:19,800
herself, the senator out of New York, that, you know, we're

606
00:41:19,800 --> 00:41:23,000
banning algorithmic alternatives backing stablecoins with things

607
00:41:23,000 --> 00:41:28,940
like Bitcoin to preserve the dual banking system, which is,

608
00:41:28,940 --> 00:41:32,120
you know, obviously under the interest of, you know, the big

609
00:41:32,120 --> 00:41:35,240
players in the dollar system, the private banks who run the

610
00:41:35,540 --> 00:41:40,120
who are the donor class that run the government in Many ways. You

611
00:41:40,120 --> 00:41:43,600
know, gillenbrand is coming out proposing legislation saying we

612
00:41:43,600 --> 00:41:46,300
can't have this happen again. This was such a bad collapse. It

613
00:41:46,300 --> 00:41:50,740
hurt so many people. It was so terrible. FTX was so

614
00:41:51,700 --> 00:41:55,060
irresponsible, and Terra Luna was was just such a terrible

615
00:41:55,060 --> 00:41:57,940
idea technologically, that we need to make sure that this

616
00:41:57,940 --> 00:42:00,540
never happens again. And therefore we're going to put

617
00:42:00,540 --> 00:42:03,060
these rules in place in our stablecoin legislation that

618
00:42:03,060 --> 00:42:06,240
says you need to have regular audits, and they need to be

619
00:42:06,420 --> 00:42:12,360
backed by US Treasuries and nothing else, which, of course,

620
00:42:13,320 --> 00:42:16,380
is a bummer in a lot of ways, because there are ways you could

621
00:42:16,380 --> 00:42:20,420
create stablecoins that don't touch us debt at all. And that

622
00:42:20,420 --> 00:42:23,720
would be kind of interesting to create the idea of $1 without

623
00:42:23,720 --> 00:42:27,980
perpetuating US Empire by buying Uncle Sam's bags. But of course,

624
00:42:27,980 --> 00:42:31,820
via this controlled demolition of Terra Luna and FTX, we get

625
00:42:31,820 --> 00:42:37,460
legislation that is now also in the GENIUS Act, that says, you

626
00:42:37,460 --> 00:42:43,000
know, algorithmic stablecoins are a no no. So you could argue

627
00:42:43,000 --> 00:42:46,420
very much so that, you know, Tethers intimate connection to

628
00:42:46,420 --> 00:42:50,980
FTX collapsing in Alameda. You know, $30 billion going back and

629
00:42:50,980 --> 00:42:52,420
forth between these companies,

630
00:42:53,980 --> 00:42:57,400
perhaps seals intimate connection to the start of the

631
00:42:57,520 --> 00:43:03,540
of the stablecoin industry and Tether, which is the stablecoin

632
00:43:03,540 --> 00:43:07,080
that is backed by US debt. You know, perhaps these players

633
00:43:07,140 --> 00:43:12,480
were, you know, actually, actually, you know, set this up

634
00:43:12,480 --> 00:43:17,580
to be a demolition, a very public demolition to then, you

635
00:43:17,580 --> 00:43:21,200
know, dialectically lead everybody into the GENIUS Act,

636
00:43:21,680 --> 00:43:25,760
which obviously benefits the, you know, the stablecoin

637
00:43:25,820 --> 00:43:28,700
issuers that back themselves with government debt, which

638
00:43:28,700 --> 00:43:33,320
happened to be, you know, these players, very interestingly. You

639
00:43:33,320 --> 00:43:36,320
know, I think it was six months after the banking crisis that

640
00:43:36,320 --> 00:43:42,760
SVB and silver gate, you know, collapsed, and two weeks right

641
00:43:42,760 --> 00:43:46,120
after the US House Financial Services Committee advanced the

642
00:43:46,120 --> 00:43:48,400
first iteration of the stablecoin bill, which was this,

643
00:43:48,400 --> 00:43:52,240
Gillibrand Lummis stablecoin bill. PayPal themselves,

644
00:43:53,320 --> 00:43:56,200
alongside their partner Paxos, which is founded by a former

645
00:43:56,200 --> 00:43:59,980
Goldman guy, Charles cascarilla, they launched their own

646
00:43:59,980 --> 00:44:06,540
stablecoin py USD, which is, of course, backed by short term US

647
00:44:06,540 --> 00:44:13,320
debt as well. And arguably, P Y U S D is the most set up to take

648
00:44:13,320 --> 00:44:17,700
advantage of the legislation that is the GENIUS Act, mostly

649
00:44:17,700 --> 00:44:21,200
because they're domiciled in the US whereas Tether is not so

650
00:44:21,200 --> 00:44:25,100
while Tether is really set up to take advantage of, you know,

651
00:44:25,100 --> 00:44:29,060
come back into market. You know, the CEO Paulo Arduino, was

652
00:44:29,060 --> 00:44:32,120
standing behind Trump when he signed the GENIUS Act. You know,

653
00:44:32,120 --> 00:44:36,140
they have every intention to start a US based stablecoin and

654
00:44:36,140 --> 00:44:41,200
come back to the US, but p, y, u, s, d is very likely to take a

655
00:44:41,200 --> 00:44:45,700
pretty big share of the market, you know, because of the public

656
00:44:45,700 --> 00:44:48,880
sector legislation that was driven directly by these private

657
00:44:48,880 --> 00:44:53,020
sector shenanigans. So we'll take a little break there. I'll

658
00:44:53,020 --> 00:44:56,860
stop, but I think that you can kind of begin to see that while,

659
00:44:56,860 --> 00:45:00,360
yes, it's very cool that you know, private sector. Doing

660
00:45:00,360 --> 00:45:03,180
things, and the free market is doing things. In reality,

661
00:45:03,180 --> 00:45:08,460
there's cartels that run free in these free markets that have,

662
00:45:08,820 --> 00:45:14,220
you know, huge power, and are able to cause, you know, huge

663
00:45:14,220 --> 00:45:18,000
demolitions and breakdowns of other people's systems, breaking

664
00:45:18,000 --> 00:45:21,860
algorithmic pegs, you know, because they have so much more

665
00:45:21,860 --> 00:45:25,040
liquidity and power than other people, whether or not Terra

666
00:45:25,040 --> 00:45:30,020
Luna was set up to to break down or was a well intended idea that

667
00:45:30,020 --> 00:45:33,560
went wrong, regardless, is this is the outcome, and

668
00:45:33,560 --> 00:45:38,300
unfortunately, it bans, you know, technological innovation

669
00:45:38,420 --> 00:45:42,700
that really could create a whole other economy that completely

670
00:45:42,700 --> 00:45:47,800
circumnavigates government debt. But unfortunately, that won't be

671
00:45:47,800 --> 00:45:51,040
the case now here with the GENIUS Act, well,

672
00:45:51,040 --> 00:45:53,200
I think it's very compelling, honestly, when

673
00:45:53,200 --> 00:45:56,140
looking at the chronology you just laid out, that there's

674
00:45:56,140 --> 00:45:58,840
something else going on here than what's been publicly

675
00:45:58,840 --> 00:46:02,940
telegraphed, obviously, in the role of Thiel, and people tied to

676
00:46:02,940 --> 00:46:06,300
him and PayPal in general, I think is difficult to ignore,

677
00:46:06,480 --> 00:46:09,060
and that's especially true when we look at what followed FTX,

678
00:46:09,360 --> 00:46:13,080
that we brought up a few times in passing, the collapse of

679
00:46:13,080 --> 00:46:16,200
Silicon Valley Bank. In the aftermath of the collapse of

680
00:46:16,200 --> 00:46:19,500
Silicon Valley Bank, we have a direct result of that from the

681
00:46:19,500 --> 00:46:23,480
horse's own mouth. Palmer lucky and Joe Lonsdale. Joe Lonsdale

682
00:46:23,480 --> 00:46:26,480
being a co founder of Palantir with Peter Thiel and Palmer

683
00:46:26,480 --> 00:46:30,860
lucky being a a Thiel fellow whose businesses since then have

684
00:46:30,860 --> 00:46:34,700
been largely financed by Thiel creating this new stablecoin

685
00:46:34,700 --> 00:46:39,560
bank that's essentially framing itself as a replacement to SVB,

686
00:46:39,560 --> 00:46:42,400
catering specifically the Silicon Valley startups, but

687
00:46:42,400 --> 00:46:46,300
it's a stablecoin bank called erevor, literally named for the

688
00:46:46,480 --> 00:46:50,920
the mountain of all the dwarfs, gold that was stolen from the

689
00:46:50,920 --> 00:46:53,980
dwarvens by the dragon slog. I mean, I don't know it's like

690
00:46:53,980 --> 00:46:58,600
kind of an outrageous, uh, Tolkien universe name, even, you

691
00:46:58,600 --> 00:47:01,800
know, I mean, so many Thiel-verse companies are named after

692
00:47:01,800 --> 00:47:05,460
Tolkien stuff, but this one is probably the most telling of

693
00:47:05,460 --> 00:47:08,460
all, except, except maybe Palantir itself, I don't know.

694
00:47:08,940 --> 00:47:12,120
But when you look at all of all of what you explained and then

695
00:47:12,120 --> 00:47:15,660
that together, it seems like you know with what's coming to

696
00:47:15,660 --> 00:47:19,320
fruition, with the GENIUS Act, largely designed by former

697
00:47:19,320 --> 00:47:25,820
PayPal CEO David Sacks, that we are basically witnessing the big

698
00:47:25,820 --> 00:47:31,100
reveal of longer term plans that if you don't dig into the weeds

699
00:47:31,160 --> 00:47:35,540
as you did, and you know, I did as well, but not as much as you

700
00:47:35,540 --> 00:47:40,280
in the case of this investigation, it's very clear

701
00:47:40,280 --> 00:47:43,360
that there's a lot of connective tissue between all of the

702
00:47:43,420 --> 00:47:47,620
seemingly separate major economic events in the finance

703
00:47:47,620 --> 00:47:50,560
and later the cryptocurrency space, that suggests that a lot

704
00:47:50,560 --> 00:47:52,660
of this is Tethered together. And,

705
00:47:54,040 --> 00:47:58,360
yeah, absolutely. And I think even more so, I mean, it's

706
00:47:58,360 --> 00:48:02,280
very disturbing this this era bore idea, especially when you

707
00:48:02,280 --> 00:48:04,920
consider, you know, what were the things that caused the

708
00:48:04,920 --> 00:48:08,040
collapse of Silicon Valley Bank, as I already talked about, ThielS

709
00:48:08,040 --> 00:48:10,620
Founders Fund, you know, basically putting out this

710
00:48:10,620 --> 00:48:13,740
bulletin being like, hey, we pull out our funds. You know, we

711
00:48:13,740 --> 00:48:17,700
advise you to do the same boom. The bank collapsed basically

712
00:48:17,700 --> 00:48:21,800
overnight. But what happened? You know, years before, under

713
00:48:21,800 --> 00:48:27,020
the Trump administration, was really what set up, you know,

714
00:48:27,080 --> 00:48:29,300
everything that we're seeing now. And so there's so much to

715
00:48:29,300 --> 00:48:32,780
talk about with the first you know, Trump 1.0 you know, very

716
00:48:32,780 --> 00:48:36,680
infamously, you know, tweeted out about how he doesn't like

717
00:48:36,680 --> 00:48:39,140
Bitcoin, and it's hot air, and the dollar is the only thing

718
00:48:39,140 --> 00:48:43,360
that matters, and yada yada. But again, he's kind of a you people

719
00:48:43,360 --> 00:48:47,740
really underestimate him and he and he loves to talk, you know,

720
00:48:47,740 --> 00:48:51,160
out of one side of his mouth, while, you know, using the other

721
00:48:51,160 --> 00:48:55,780
side of his mouth to create a whole industry and regulation

722
00:48:55,780 --> 00:48:59,380
that directly goes against what he's saying. I think people are

723
00:48:59,380 --> 00:49:03,300
starting to realize that now that is Trump's method. But in

724
00:49:03,300 --> 00:49:06,600
2018 the Trump administration did. It did a pretty severe

725
00:49:06,600 --> 00:49:09,360
deregulation of the banking industry that specifically

726
00:49:09,360 --> 00:49:14,220
loosened capital and reporting requirements, that said that

727
00:49:14,220 --> 00:49:18,840
banks under a certain apron were able to have you know, less

728
00:49:19,680 --> 00:49:24,680
deposits you know, versus the amount of credits that they had,

729
00:49:25,220 --> 00:49:29,360
which allowed banks to be further insolvent, further

730
00:49:29,360 --> 00:49:34,400
fractionalized, and have less reserves. So when an issue came

731
00:49:34,400 --> 00:49:38,300
up, like we saw, the banking crisis was really spurned, you

732
00:49:38,300 --> 00:49:42,040
know, directly by, you know, the Trump administration, if you

733
00:49:42,040 --> 00:49:47,560
factor in, you know, the Treasury and the Fed into that,

734
00:49:47,620 --> 00:49:53,140
into that model. You know, we saw interest rates go to zero at

735
00:49:53,140 --> 00:49:56,980
the onset of the pandemic in 2020, but then we saw the

736
00:49:56,980 --> 00:50:01,260
fastest increase in interest rates at. Ever in history, not

737
00:50:01,260 --> 00:50:04,500
to the highest point which Volcker did in the 80s, but we

738
00:50:04,500 --> 00:50:08,160
saw the fastest, you know, furthest increase which we went

739
00:50:08,160 --> 00:50:13,560
from zero to, you know, four and a half percent interest on this

740
00:50:13,560 --> 00:50:17,160
debt, you know, really, really quickly. And what happened was a

741
00:50:17,160 --> 00:50:21,740
lot of these banks had bought really low yield bonds, long

742
00:50:21,740 --> 00:50:26,540
duration bonds, when interest rates were at zero due to the

743
00:50:26,540 --> 00:50:29,120
government locking down the country and bringing interest

744
00:50:29,120 --> 00:50:32,480
rates to zero. So a lot of these banks bought these long duration

745
00:50:32,480 --> 00:50:36,740
bonds that only gave a couple points, that were very you know,

746
00:50:37,460 --> 00:50:40,480
you had to hold them for 30 years to make a couple percent.

747
00:50:40,840 --> 00:50:44,500
But then, you know, Powell comes in and raises interest rates up

748
00:50:44,500 --> 00:50:47,860
to four and a half percent in like 18 months, and it basically

749
00:50:48,100 --> 00:50:51,220
what happened was it broke the yield curve, and so it was

750
00:50:51,220 --> 00:50:55,300
actually more profitable to hold short term debt. So all of these

751
00:50:55,300 --> 00:50:57,820
people came and wanted to take their money and put it into

752
00:50:57,820 --> 00:51:02,580
short term bonds and take their capital out of these banks that

753
00:51:02,580 --> 00:51:05,040
had just bought a bunch of long duration bonds that were

754
00:51:05,040 --> 00:51:10,200
illiquid and asked for cash to go buy, you know, short duration

755
00:51:10,200 --> 00:51:14,640
bonds to make four and a half percent in a year versus, you

756
00:51:14,640 --> 00:51:18,240
know, one and a half percent over 30 years. So it's an

757
00:51:18,240 --> 00:51:21,740
obvious arbitrage. And so what happened was it was a dual

758
00:51:22,520 --> 00:51:27,080
cutting edge to these banks that they had to sell their long

759
00:51:27,080 --> 00:51:32,720
duration bonds that they bought during the pandemic, to sell to

760
00:51:32,720 --> 00:51:37,100
get cash to pay their depositors who were fleeing. So they were

761
00:51:37,100 --> 00:51:41,080
selling their bonds at a loss as a bunch of people were pulling

762
00:51:41,080 --> 00:51:44,740
their money out that was caused, you know, they didn't have as

763
00:51:44,740 --> 00:51:48,880
much reserves because Trump deregulated the banking industry

764
00:51:48,880 --> 00:51:52,240
in 2018 so directly, we're seeing the Trump administration

765
00:51:52,240 --> 00:51:56,680
was really a huge part of why the banks weren't solvent and

766
00:51:56,680 --> 00:52:01,260
why they went under and and we saw, you know, people that were

767
00:52:01,260 --> 00:52:03,600
very intimate to the Trump administration, like Peter

768
00:52:03,600 --> 00:52:06,720
Thiel, calling for people to pull their money out. So you

769
00:52:06,720 --> 00:52:09,960
begin to kind of see, oh, there's kind of a coalition

770
00:52:09,960 --> 00:52:14,340
forming here of players that are using the public sector to

771
00:52:14,340 --> 00:52:18,300
create great opportunity to make tons of money. I'm not even

772
00:52:18,300 --> 00:52:21,440
going to talk about going direct, which was obviously this

773
00:52:21,440 --> 00:52:24,860
plan that was done in 2019 before there was really an

774
00:52:24,860 --> 00:52:29,780
inner, a whiff, a whisper of a virus that was done between

775
00:52:29,780 --> 00:52:33,620
Trump's former money manager Larry Fink of Blackrock to

776
00:52:33,620 --> 00:52:38,420
create, you know, a program to basically inject trillions of

777
00:52:38,420 --> 00:52:41,200
dollars of funding directly To BlackRock, into Wall Street in

778
00:52:41,200 --> 00:52:44,320
general, and circumnavigate Main Street the next time there was

779
00:52:44,320 --> 00:52:47,020
the need of a bailout. But even ignoring that, which is

780
00:52:47,020 --> 00:52:51,100
obviously a huge part of why COVID even happened, you know,

781
00:52:51,100 --> 00:52:53,800
you can begin to look at the Trump administration's

782
00:52:53,920 --> 00:52:58,180
regulation or deregulation that led directly to the banking

783
00:52:58,180 --> 00:53:03,120
crisis that we saw, that, you know, SCB was, was probably the

784
00:53:03,120 --> 00:53:08,580
most prominent. But even before that, right in 2019 before going

785
00:53:08,580 --> 00:53:13,140
direct, you know, right after this, this banking deregulation,

786
00:53:13,380 --> 00:53:18,480
Jared Kushner, the son in law of Trump, sent an email to head of

787
00:53:18,480 --> 00:53:23,660
Treasury, Steve Mnuchin about a blog post that was written by a

788
00:53:23,660 --> 00:53:29,480
Thiel acolyte, Sam Altman of OpenAI, who wrote a blog post

789
00:53:29,480 --> 00:53:33,500
about stablecoins called us digital currency. This was long

790
00:53:33,500 --> 00:53:37,640
before USDC was created. But this idea of, hey, maybe we

791
00:53:37,640 --> 00:53:41,800
should look into stablecoins as a way to sort of extend dollar

792
00:53:41,800 --> 00:53:45,580
hedge fund and find a new, you know, buyer of debt. So what?

793
00:53:45,580 --> 00:53:50,200
Let's, let's find some new demand. So Minuchin and Kushner

794
00:53:50,200 --> 00:53:54,220
were talking about, you know, Thiel-verse bros, talking about

795
00:53:54,220 --> 00:53:59,080
stablecoins in 2019 when it was a very small industry. And we

796
00:53:59,080 --> 00:54:03,480
actually saw that in March 2020, which is literally when the

797
00:54:03,480 --> 00:54:07,860
government shut down the world, you know, Mnuchin Treasury held

798
00:54:07,860 --> 00:54:14,820
a meeting which included Peter Thiel and Wences Casares, who

799
00:54:14,820 --> 00:54:19,080
was the head of zap, who was a former PayPal guy who, you know,

800
00:54:19,080 --> 00:54:22,220
was considered the Patient Zero of Silicon Valley for Bitcoin,

801
00:54:22,220 --> 00:54:25,760
who introduced everybody to Bitcoin, so he says. But he held

802
00:54:25,760 --> 00:54:30,080
a meeting at the Treasury in March 2020, and at the same

803
00:54:30,080 --> 00:54:35,480
time, his OCC the Office of the Comptroller the currency, which

804
00:54:35,480 --> 00:54:40,780
is like the head, you know, regulator for banks at the time

805
00:54:40,780 --> 00:54:45,040
was Brian Brooks, who used to work with Minuchin at one West,

806
00:54:45,040 --> 00:54:48,940
which was their bank that went under in oh eight that made tons

807
00:54:48,940 --> 00:54:53,980
of money profiting off of the bailouts. Essentially, he was

808
00:54:53,980 --> 00:54:58,180
also the found, one of the founding legal head regulators

809
00:54:58,180 --> 00:55:01,500
of Coinbase, which is the you. US based crypto exchange that

810
00:55:01,500 --> 00:55:05,160
holds the US government's Bitcoin. He put out a bulletin

811
00:55:05,340 --> 00:55:09,360
at the, you know, around the same time that allowed banks to

812
00:55:09,360 --> 00:55:12,360
hold crypto assets, and specifically to use stable

813
00:55:12,360 --> 00:55:17,220
coins. And then on his like, I think it was this last third to

814
00:55:17,220 --> 00:55:22,100
last day in office before Brian Brooks turned over the OCC to

815
00:55:22,340 --> 00:55:25,520
the incoming Biden administration, he actually gave

816
00:55:25,520 --> 00:55:29,900
a crypto charter, a bank charter, to the first crypto

817
00:55:29,900 --> 00:55:33,860
Bank, which is anchorage digital, which is advised by Max

818
00:55:33,860 --> 00:55:40,520
Levchin. And they actually run the rewards for p, y, u, s, d,

819
00:55:40,520 --> 00:55:43,840
the stablecoin rewards for that market. So in the first

820
00:55:43,840 --> 00:55:48,220
administration, all of the setup was there for everything we saw

821
00:55:48,400 --> 00:55:53,620
in 2022 in 2023 the banking crisis, the stablecoin boom,

822
00:55:54,340 --> 00:55:59,140
Bitcoin going from three and a half $1,000 to almost $70,000 in

823
00:55:59,140 --> 00:56:03,480
about 18 months after the COVID collapse, everything that we,

824
00:56:03,480 --> 00:56:07,500
kind of everyone is sort of aware of, was really started

825
00:56:08,580 --> 00:56:12,720
during Trump administration, one, specifically with Minuchin

826
00:56:14,040 --> 00:56:19,800
and and this deregulation and regulation while Trump is

827
00:56:19,800 --> 00:56:23,480
tweeting out how much he hates Bitcoin. He really set it up,

828
00:56:24,500 --> 00:56:29,060
you know, the groundwork for this industry to thrive. And it

829
00:56:29,060 --> 00:56:33,260
sure did. I mean, in 2020 Tether was 10 billion, and now they're,

830
00:56:34,100 --> 00:56:37,340
you know, I'm sure there'll be over 200 billion, probably by

831
00:56:37,340 --> 00:56:41,500
the end of the year, if not before. So, you know, there's a

832
00:56:41,500 --> 00:56:46,900
lot of things to say about the first Trump administration and

833
00:56:46,900 --> 00:56:50,620
the people around him setting up everything that we're seeing,

834
00:56:50,860 --> 00:56:54,400
you know, now coming to fruition with the GENIUS Act and Trump

835
00:56:54,400 --> 00:56:59,860
2.0 and I think a lot of people sort of miss that, you know, the

836
00:56:59,860 --> 00:57:03,540
first time around, because Trump is so loud, people are looking

837
00:57:03,540 --> 00:57:07,560
at what he's actually saying and not what he's doing. Now they're

838
00:57:07,560 --> 00:57:10,800
starting to see what he's doing. He has no need for re election.

839
00:57:10,800 --> 00:57:14,100
He obviously doesn't really seem to care what his base says, as

840
00:57:14,100 --> 00:57:18,420
he's kind of throwing them aside and just moving forward at the

841
00:57:18,420 --> 00:57:21,620
behest of the technocrats that that put them in power in the

842
00:57:21,620 --> 00:57:25,400
first place. And of course, how do you dictate human behavior?

843
00:57:25,880 --> 00:57:28,940
It's incentives, and financial incentives, specifically

844
00:57:29,300 --> 00:57:32,060
conveniences, that come downstream of them. And I think

845
00:57:32,060 --> 00:57:36,620
stablecoins are going to be the greatest lever that this

846
00:57:36,620 --> 00:57:43,360
technocratic administration has to lever control over the US and

847
00:57:43,360 --> 00:57:44,560
frankly, the world.

848
00:57:45,100 --> 00:57:47,140
Well, let's talk about that for a second, because you

849
00:57:47,140 --> 00:57:51,160
recently authored a piece for the Solari report, sort of about

850
00:57:51,160 --> 00:57:54,760
this idea about incentives and stablecoins directly, sort of

851
00:57:54,760 --> 00:57:58,720
talking about your analogy was the carrot and the stick, and

852
00:57:58,720 --> 00:58:04,260
this idea of how that serves as an analogy for how people in the

853
00:58:04,260 --> 00:58:08,100
US will likely be on boarded to stablecoins, whether they

854
00:58:08,100 --> 00:58:11,100
really want to or not. So can you elaborate on that a little

855
00:58:11,580 --> 00:58:14,700
bit? Yeah, sure. Well, I think the idea of the carrot

856
00:58:14,700 --> 00:58:19,020
versus the stick is this idea that you know the best way to

857
00:58:19,680 --> 00:58:25,880
sell something like stable coins, or AI, or whatever this

858
00:58:25,880 --> 00:58:30,380
sort of, you know, technological advancement du jour is, is

859
00:58:30,380 --> 00:58:34,220
through conveniences and through sort of expressing, you know,

860
00:58:34,220 --> 00:58:38,420
this is an altruistic good. It's very good for you to use stable

861
00:58:38,420 --> 00:58:43,780
coins. And that's sort of the carrot, right? The sort of ism

862
00:58:44,020 --> 00:58:47,440
of carrot, and the stick is that you see the carrot, and they

863
00:58:47,440 --> 00:58:51,760
lead you with the carrots, like a like a farm animal. And then

864
00:58:51,820 --> 00:58:54,880
one day, it's not a carrot, and it's a stick. And then the stick

865
00:58:55,060 --> 00:58:59,980
beats your your face, and in the same place that you would go for

866
00:58:59,980 --> 00:59:03,900
the convenience, now it's a stick. And so the idea, I think

867
00:59:03,960 --> 00:59:09,600
of stablecoins being the carrot right now, but will later turn

868
00:59:09,600 --> 00:59:14,280
into the stick, is that's sort of the warning that that that

869
00:59:14,280 --> 00:59:17,940
piece is sort of presenting, and of course, that The Chain really

870
00:59:17,940 --> 00:59:21,380
outlines in detail the players of who built this carrot, and

871
00:59:21,380 --> 00:59:25,340
who built this stick, but the conveniences of stablecoins?

872
00:59:25,400 --> 00:59:28,220
You know, as Thiel said, you know, oh, you're enslaved by

873
00:59:28,220 --> 00:59:31,880
your central bank, living in South America, living in Africa,

874
00:59:31,880 --> 00:59:38,060
living in Southeast Asia. Come to the to the US dollar. It's so

875
00:59:38,060 --> 00:59:42,820
stable. It's so great. You'll be able to make rewards keeping

876
00:59:42,820 --> 00:59:49,060
your money in p, y, u, s, d, at anchorage digital. Here's, you

877
00:59:49,060 --> 00:59:51,940
know, three and a half percent on your money. You can't get

878
00:59:51,940 --> 00:59:55,780
that anywhere else risk free, unless you are directly in the

879
00:59:55,780 --> 00:59:59,740
US regulatory regime, and you are buying, you know, short

880
00:59:59,740 --> 01:00:03,180
term. Term treasuries, you can't find that risk which many people

881
01:00:03,180 --> 01:00:06,180
don't have access to, brokers that they can buy government

882
01:00:06,180 --> 01:00:10,320
bonds from, so they buy these bond proxies. And stablecoins

883
01:00:10,320 --> 01:00:14,760
are really just tokenized bonds, government bonds. So here's

884
01:00:14,760 --> 01:00:18,540
access to yield, you know, three and a half percent or what, or

885
01:00:18,540 --> 01:00:21,320
what have you. So why wouldn't you store your money in stable

886
01:00:21,320 --> 01:00:25,220
coins when you can't really get that yield risk free anywhere

887
01:00:25,220 --> 01:00:28,520
else. Sure you can hold Bitcoin or Ethereum or whatever, what

888
01:00:28,520 --> 01:00:33,800
have you, and try to speculate, hold gold, try to speculate, but

889
01:00:33,800 --> 01:00:36,200
a risk free asset, you know, three and a half percent you

890
01:00:36,200 --> 01:00:39,380
put, put all of your money in, in p, y, U, S, D, and get, and

891
01:00:39,380 --> 01:00:43,180
get a free three and a half percent. But unfortunately, as

892
01:00:43,180 --> 01:00:46,060
that piece, and as a lot of my work, has sort of attempted to

893
01:00:46,060 --> 01:00:50,080
explain, is that there's a lot of downsides to stablecoins as

894
01:00:50,080 --> 01:00:55,060
it relates to programmability, Seiz ability and surveillance. I

895
01:00:55,060 --> 01:00:58,360
think those are all words, but if not, I hope you know what I

896
01:00:58,360 --> 01:01:04,680
mean. And and so the carrot being dangled over us is dollar

897
01:01:04,680 --> 01:01:08,880
access to the majority of the world and then to people in the

898
01:01:08,880 --> 01:01:13,380
US. You get access to an interest bearing checking

899
01:01:13,380 --> 01:01:17,340
account, which then you can also spend, you know, eventually, you

900
01:01:17,340 --> 01:01:21,020
know, at Amazon or via your PayPal account or Venmo. So why

901
01:01:21,260 --> 01:01:23,780
wouldn't you hold your money, which you get nothing holding it

902
01:01:23,780 --> 01:01:26,660
in a traditional bank, you get three and a half percent. Great.

903
01:01:26,840 --> 01:01:29,360
So that's sort of the carrot the people around the world that are

904
01:01:29,360 --> 01:01:32,720
in, you know, deflating, or rather inflating. You know,

905
01:01:32,720 --> 01:01:36,620
local currencies now get access to, you know, the biggest brand

906
01:01:36,620 --> 01:01:39,500
in the world, which is the US dollar. It's very convenient.

907
01:01:39,500 --> 01:01:42,760
Come on in. All you need is a smartphone and you get access to

908
01:01:42,760 --> 01:01:46,360
the US banking regime. That's awesome. But unfortunately,

909
01:01:47,320 --> 01:01:51,040
stablecoins are just as programmable as CBDCs. They're

910
01:01:51,040 --> 01:01:55,600
just as sizable as CBDCs, and in many ways, they're arguably more

911
01:01:55,600 --> 01:02:00,660
survivable than CBDCs, because rather than having a closed box

912
01:02:00,660 --> 01:02:04,560
system that you know you are, of course, 100% revealing your

913
01:02:04,560 --> 01:02:08,100
transactional data to the government and their law

914
01:02:08,100 --> 01:02:12,360
enforcement. When you use a cbdc, not everybody in the world

915
01:02:13,380 --> 01:02:18,480
has access to that ledger. It's only a it's a closed box. Now,

916
01:02:18,480 --> 01:02:20,300
again, I don't trust the government, and I don't

917
01:02:20,300 --> 01:02:23,600
necessarily think CBDCs are good. In fact, I think they're

918
01:02:23,600 --> 01:02:28,100
extremely bad and dystopian. But this dialectic replacement of

919
01:02:28,100 --> 01:02:33,140
CBDCs is stablecoins, which we've seen via the rhetoric of

920
01:02:33,140 --> 01:02:36,500
the Trump administration, you know, banning the development of

921
01:02:36,500 --> 01:02:39,440
CBDCs. I think in crypto week, there were three acts. One was

922
01:02:39,440 --> 01:02:42,460
the clarity act that sort of just broke down. Which

923
01:02:42,520 --> 01:02:46,000
blockchain is, is, you know, decentralized or not? And then

924
01:02:46,000 --> 01:02:48,040
there were the other two, which was the GENIUS Act, which

925
01:02:48,040 --> 01:02:51,580
empowers stablecoins, and then the anti cbdc Act. So we're

926
01:02:51,580 --> 01:02:54,520
seeing it at the same time, you know, as the government is

927
01:02:54,520 --> 01:02:57,820
saying, Oh man, how bad are CBDCs. They really suck. But

928
01:02:57,820 --> 01:03:01,140
check out these fancy new stable coins which are going to save

929
01:03:01,140 --> 01:03:03,840
the dollar and extend dollar hedge fund and all this stuff?

930
01:03:03,840 --> 01:03:09,540
Um, well, perhaps this victory of private market, private bank

931
01:03:09,540 --> 01:03:12,600
stablecoins is really not a win, because, rather than it

932
01:03:12,600 --> 01:03:16,740
being a closed box circuit of who gets to see your

933
01:03:16,740 --> 01:03:19,800
transactions when you are publishing your data on a public

934
01:03:19,800 --> 01:03:22,760
blockchain, anybody that has access to the Internet into the

935
01:03:22,760 --> 01:03:26,960
blockchain can download the entirety of your transactional

936
01:03:26,960 --> 01:03:31,220
data, and unfortunately, pretty much everything you do on the

937
01:03:31,220 --> 01:03:35,720
internet, as we have you know, you know, seen very clearly with

938
01:03:35,720 --> 01:03:39,260
the Snowden leaks with prism that they are gleaning

939
01:03:39,260 --> 01:03:42,700
information very directly from the fiber optic cables that the

940
01:03:42,700 --> 01:03:46,600
internet is run on. They don't even need warrants. They can

941
01:03:46,600 --> 01:03:49,540
just pull the data directly from the service providers of the

942
01:03:49,540 --> 01:03:53,020
internet. When you combine that with a public blockchain that is

943
01:03:53,260 --> 01:03:57,100
a public ledger, all of a sudden, anybody that has even

944
01:03:57,100 --> 01:04:03,900
remotely an intelligence you know, size. You know,

945
01:04:03,900 --> 01:04:08,460
computation and analysis is able to, you know, heuristically

946
01:04:08,460 --> 01:04:11,880
analyze any transaction you make. So instead of it just

947
01:04:11,880 --> 01:04:14,400
being revealed to your government, which, again, is not

948
01:04:14,400 --> 01:04:18,120
good, you're revealing it to everybody in the world, which is

949
01:04:18,120 --> 01:04:22,940
obviously extremely dangerous. And over time, more and more

950
01:04:22,940 --> 01:04:27,680
people will be able to have access to data caches that you

951
01:04:27,680 --> 01:04:31,760
know will allow that sort of analysis, and not to mention the

952
01:04:31,760 --> 01:04:34,880
computation. As computation gets cheaper and cheaper, so we're

953
01:04:34,880 --> 01:04:38,060
going to see that eventually, every transaction you make on a

954
01:04:38,060 --> 01:04:43,960
public blockchain will be survivable by anybody in the

955
01:04:43,960 --> 01:04:47,980
world, which is obviously extremely concerning. So the

956
01:04:47,980 --> 01:04:51,400
carrot is being led to us of these amazing conveniences,

957
01:04:51,400 --> 01:04:54,640
financial conveniences. You're saving money instead of spending

958
01:04:54,640 --> 01:04:57,940
3% to your credit card provider every time you make a

959
01:04:57,940 --> 01:05:00,960
transaction. As a retailer, i. You're just, you know, you're

960
01:05:00,960 --> 01:05:04,200
paying cents for a transaction. You're getting all the rewards.

961
01:05:04,320 --> 01:05:07,920
You're getting, interest bearing stablecoins you're getting out

962
01:05:07,920 --> 01:05:10,920
of your local currency, all of these conveniences fed to us,

963
01:05:10,920 --> 01:05:13,980
you know, as carrots. All of a sudden, that can turn very

964
01:05:13,980 --> 01:05:18,600
quickly, and these stablecoin providers will start on BART

965
01:05:18,600 --> 01:05:23,360
boarding, law enforcement, start seizing funds and started doing

966
01:05:23,360 --> 01:05:27,200
things at the behest of the government, because it is a

967
01:05:27,200 --> 01:05:29,840
public, private relationship, and if you want to hold $150

968
01:05:30,620 --> 01:05:33,680
billion of treasuries, you damn well better do whatever the

969
01:05:33,680 --> 01:05:36,500
government tells you to do. Otherwise, they will seize the

970
01:05:36,500 --> 01:05:39,740
issuers treasuries. So we've seen that already with Tether.

971
01:05:39,980 --> 01:05:42,520
We're going to see that with other stablecoins, that the

972
01:05:43,240 --> 01:05:47,320
compliance with the public sector by these private sector

973
01:05:47,320 --> 01:05:50,740
entities will actually create a scenario that is probably the

974
01:05:50,740 --> 01:05:54,400
worst of both worlds, where it is a private company that can

975
01:05:54,400 --> 01:05:59,080
deny your service at a whim. There's no need for

976
01:05:59,380 --> 01:06:03,900
constitutional protections, but they are also still at the

977
01:06:03,900 --> 01:06:07,320
behest of the public sector anyway, and the law enforcement

978
01:06:07,320 --> 01:06:11,940
of the public sector and their arms, whether it's the FBI, the

979
01:06:11,940 --> 01:06:15,240
Secret Service, which are on Tethers platform, or even

980
01:06:15,240 --> 01:06:19,440
private institutions like chain analysis, which is a private

981
01:06:19,500 --> 01:06:23,060
blockchain analyst company that was funded by the CIA's venture

982
01:06:23,060 --> 01:06:27,260
firm in Q tel. All of those are already on Tethers platform, and

983
01:06:27,260 --> 01:06:30,620
we've seen hundreds of millions, if not a billion dollars, of

984
01:06:30,620 --> 01:06:34,700
Tether seized and frozen by Tether at the behest of local

985
01:06:34,700 --> 01:06:38,060
law enforcement. I assume that number will also go up quite a

986
01:06:38,060 --> 01:06:41,260
bit as the number of Tethers goes up quite a bit, and the

987
01:06:41,260 --> 01:06:44,500
users go up quite a bit. So unfortunately, this, this win of

988
01:06:44,500 --> 01:06:47,860
the private market over the central bank digital currency

989
01:06:47,860 --> 01:06:52,000
is, is, is arguably, in many ways, unfortunately, worse.

990
01:06:52,540 --> 01:06:54,940
Well, it's a public private partnership. So with those who

991
01:06:54,940 --> 01:06:58,300
tend to get the worst of the public sector and the worst of

992
01:06:58,300 --> 01:07:02,160
the private sector all in one neat little system. And as you

993
01:07:02,160 --> 01:07:04,920
pointed out with Tether, I mean, Tethers essentially become that

994
01:07:04,920 --> 01:07:09,000
by fusing their platform with us, law enforcement seizing

995
01:07:09,000 --> 01:07:12,060
people's money without recourse. The US government says this

996
01:07:12,060 --> 01:07:16,260
person bad, Tether banned them, and then it's, you know, their

997
01:07:16,260 --> 01:07:18,720
money's taken by Tether. And they can't be like, I'm not

998
01:07:18,720 --> 01:07:21,320
really a terrorist. The US government got it wrong. There's

999
01:07:21,320 --> 01:07:27,380
no way to, sort of, you know, there's no do overs there. And

1000
01:07:27,380 --> 01:07:29,780
you know, as you pointed out elsewhere, there's no

1001
01:07:29,780 --> 01:07:32,660
constitutional protections, really, because Tether isn't

1002
01:07:32,660 --> 01:07:36,740
even located in the US, so the First Amendment doesn't really

1003
01:07:37,100 --> 01:07:42,280
apply to anything they do. And in the case of pyusd, which you,

1004
01:07:42,280 --> 01:07:44,740
you know, sort of frame, more or less, as one of the winners of

1005
01:07:44,740 --> 01:07:51,040
this multi year waged stable coin war. You know, PayPal,

1006
01:07:51,340 --> 01:07:54,880
arguably, you know, the Snowden leaks were privatized by the

1007
01:07:54,880 --> 01:07:57,880
Pierre, by Pierre Omidyar, through His creation of the

1008
01:07:57,880 --> 01:08:01,680
intercept. He was the owner of PayPal at the time, and

1009
01:08:01,680 --> 01:08:04,080
allegedly, you know, as I reported for mint press at the

1010
01:08:04,080 --> 01:08:11,280
time, privatized those leaks, because a lot of the leaks there

1011
01:08:11,280 --> 01:08:13,560
showed PayPal direct collaboration with US

1012
01:08:13,560 --> 01:08:17,880
intelligence as it related to the US surveillance system. And

1013
01:08:17,880 --> 01:08:20,840
of course, when Pierre Omidyar was running eBay in the late

1014
01:08:20,840 --> 01:08:24,560
90s, he had onboarded law enforcement and all of that. So,

1015
01:08:24,560 --> 01:08:28,040
I mean, PayPal, even though it's has different ownership now I

1016
01:08:28,040 --> 01:08:31,400
believe, or slightly different ownership, you know, has a long

1017
01:08:31,400 --> 01:08:35,000
trajectory of doing that kind of stuff. And then, of course, you

1018
01:08:35,000 --> 01:08:38,660
know, during COVID, PayPal de banks people constantly, and

1019
01:08:38,660 --> 01:08:42,700
they did it before too, but, you know, there was not really any

1020
01:08:42,700 --> 01:08:46,720
recourse for people that were, you know, just booted off the

1021
01:08:46,720 --> 01:08:50,140
PayPal platforms. Why would their stablecoin be any

1022
01:08:50,140 --> 01:08:54,700
different? And you know, have JP Morgan, for example, and all

1023
01:08:54,700 --> 01:08:57,340
these other banks talking about making their own stablecoins

1024
01:08:57,340 --> 01:09:01,140
and getting in the stablecoin play. And of course, JP Morgan,

1025
01:09:01,440 --> 01:09:06,420
rather notoriously deep banked. Dr Mark executives during the

1026
01:09:06,420 --> 01:09:10,080
COVID era, and there was no recourse to them. So you know,

1027
01:09:10,080 --> 01:09:13,560
even for some of these private banks and companies in the US,

1028
01:09:13,620 --> 01:09:17,280
First Amendment protections don't apply either. So you know,

1029
01:09:18,540 --> 01:09:21,140
and they can be public, you know, pressured by the public

1030
01:09:21,140 --> 01:09:24,140
sector, even though they're private company companies, to de

1031
01:09:24,140 --> 01:09:27,800
bank people. And you know this happened with social media. It

1032
01:09:27,980 --> 01:09:30,920
happens with social media, and it happens banking. And now that

1033
01:09:30,920 --> 01:09:34,820
social media and banking are due to fuse, it's probably not going

1034
01:09:34,820 --> 01:09:39,380
to be any any different, unfortunately, from the

1035
01:09:39,380 --> 01:09:43,300
seizability perspective or the surveillance perspective. And

1036
01:09:43,300 --> 01:09:46,480
programmability, of course, is another one of the concerns

1037
01:09:46,480 --> 01:09:49,420
about CBDCs, but also with stablecoins, because you can

1038
01:09:49,420 --> 01:09:54,340
make stablecoins not work for any sort of purpose, just like

1039
01:09:54,580 --> 01:09:57,280
the government could theoretically program CBDCs to

1040
01:09:57,280 --> 01:09:59,920
not work if they want you to prevent you from buying.

1041
01:10:00,000 --> 01:10:03,300
Something or using your money in a particular way, stablecoins,

1042
01:10:03,960 --> 01:10:09,480
you know, can be made to serve that purpose as well. So not

1043
01:10:09,480 --> 01:10:12,420
great. And I do want to bring up a Tether quote, because it's

1044
01:10:13,500 --> 01:10:16,800
very relevant here. I believe it was Howard Lutnick, who's now

1045
01:10:16,800 --> 01:10:19,380
Secretary of Commerce under Trump, but he was talking about

1046
01:10:19,380 --> 01:10:21,980
how great Tether is, because if you want to freeze someone's

1047
01:10:21,980 --> 01:10:28,100
funds with Tether, you just called Joe Lubin, who is one of

1048
01:10:28,100 --> 01:10:31,160
the co founders of Tether, if I'm not mistaken, co founders of

1049
01:10:31,160 --> 01:10:34,340
Ethereum. Yeah. Sorry, Ethereum, that was to freeze Ethereum.

1050
01:10:34,340 --> 01:10:35,840
Yep, exactly. And Ethereum,

1051
01:10:35,900 --> 01:10:40,180
right? Was founded by Vitalik Buterin, who also was

1052
01:10:40,180 --> 01:10:43,900
awarded a Thiel fellowship in 2014 to work on Ethereum. And

1053
01:10:43,900 --> 01:10:47,080
Ethereum, of course, is the blockchain of choice for these

1054
01:10:47,080 --> 01:10:51,280
stablecoins. There's more stablecoins value on Ethereum

1055
01:10:52,120 --> 01:10:55,840
than there are on any other chain, which is, you know,

1056
01:10:56,020 --> 01:10:59,560
decently concerning. We're also seeing developments now where

1057
01:10:59,560 --> 01:11:04,260
Thiel was putting, you know, he now owns an almost 10% stake in

1058
01:11:04,440 --> 01:11:08,520
an Ethereum Treasury company that is buying up, you know,

1059
01:11:09,960 --> 01:11:12,960
billions of dollars of Ethereum, which has kind of come out in

1060
01:11:12,960 --> 01:11:16,260
the last few days. And so, you know, Ethereum is a proof of

1061
01:11:16,260 --> 01:11:19,680
stake model, so the owners of the Ethereum, the people that

1062
01:11:19,740 --> 01:11:24,380
hold more Ethereum have a greater say over the validation

1063
01:11:24,380 --> 01:11:28,040
of the network, which is very important. So to exemplify that

1064
01:11:28,040 --> 01:11:31,880
point made by lutnik, whose fund, Cantor Fitzgerald holds

1065
01:11:31,940 --> 01:11:36,020
all of the bonds for Tether. Interestingly enough, he, of

1066
01:11:36,020 --> 01:11:39,140
course, is no longer the CEO, as he is a public official, and his

1067
01:11:39,140 --> 01:11:43,780
son, Brandon has taken over. But yeah, that quote of you know, if

1068
01:11:43,780 --> 01:11:46,720
you want to seize Tethers, you just call Tether and if you want

1069
01:11:46,720 --> 01:11:50,860
to stop Ethereum, you just call Joe Lubin. It's pretty

1070
01:11:50,860 --> 01:11:54,400
disturbing when you begin to kind of put it all together. Joe

1071
01:11:54,400 --> 01:12:01,260
Lubin, I believe, was the the college roommate of Michael

1072
01:12:01,320 --> 01:12:07,500
Novogratz, who is former Goldman trader as well, who was also the

1073
01:12:07,620 --> 01:12:12,720
biggest public proponent of Terra Luna, and even got it

1074
01:12:12,720 --> 01:12:18,960
tattooed to his arm, this very cringe wolf howling on his arm,

1075
01:12:18,960 --> 01:12:21,620
you know, right Before everything collapsed, obviously.

1076
01:12:21,680 --> 01:12:24,620
And they were college roommates, interestingly. And Novogratz was

1077
01:12:24,620 --> 01:12:29,600
also a big investor of Eos, which was a group done by Peter

1078
01:12:29,660 --> 01:12:34,100
Thiel and Brock Pierce. They made a blockchain with William

1079
01:12:34,100 --> 01:12:37,040
Quigley, who was also one of the initial founders of PayPal and

1080
01:12:37,040 --> 01:12:41,260
one of the co founders of Tether, who worked at clearstone

1081
01:12:41,260 --> 01:12:45,520
with them, alongside them at Eos, was Christian anger Meyer,

1082
01:12:45,520 --> 01:12:51,520
who was, you know, involved in the wire card scandal. He's most

1083
01:12:51,520 --> 01:12:55,300
known for being a psych, psychedelic investor, but he

1084
01:12:55,300 --> 01:13:00,220
helped Tether manage a whole bunch of investments, including,

1085
01:13:00,940 --> 01:13:06,420
you know, buying a whole bunch of Bitcoin miners and even

1086
01:13:06,420 --> 01:13:09,780
Tethers. Investment in SATA logic, which is a company that a

1087
01:13:09,780 --> 01:13:13,020
satellite surveillance company that is chaired, or rather the

1088
01:13:13,020 --> 01:13:17,100
board features Minuchin and lutnik, as well as some other

1089
01:13:17,640 --> 01:13:22,460
goals. And then also Louis bacon, who's right up there with

1090
01:13:22,460 --> 01:13:26,720
George Soros, is one of the biggest players in the 90s

1091
01:13:26,720 --> 01:13:32,120
currency speculator gang, who was, conveniently enough, the

1092
01:13:32,600 --> 01:13:38,060
main funder of IDEA Lab, which was the main first funder of

1093
01:13:38,060 --> 01:13:41,860
PayPal. So interestingly, a lot of these people are all coming

1094
01:13:41,860 --> 01:13:48,700
back together. And you brought up a point here about the social

1095
01:13:48,700 --> 01:13:52,540
media networks kind of becoming banks. And one of the, one of

1096
01:13:52,660 --> 01:13:55,720
the main focuses on the last piece, The Chain of command in

1097
01:13:55,720 --> 01:13:59,320
this series is, is sort of the setup of Facebook's Libra

1098
01:13:59,320 --> 01:14:05,580
project, which was, which was the first kind of idea of, you

1099
01:14:05,580 --> 01:14:09,000
know, a stablecoin being on a social network, because now that

1100
01:14:09,000 --> 01:14:13,860
data has become, you know, the the platform of money. Money has

1101
01:14:13,860 --> 01:14:18,120
become data. All you need is communication networks and human

1102
01:14:18,120 --> 01:14:22,100
networks to be able to create a pretty big user base. Facebook

1103
01:14:22,100 --> 01:14:25,880
has the largest active monthly user base of any platform in the

1104
01:14:25,880 --> 01:14:30,260
world. And David Marcus, who was the former president of PayPal,

1105
01:14:30,920 --> 01:14:37,460
came in to start this project, this stablecoin project, with

1106
01:14:38,180 --> 01:14:42,160
with Facebook, very interestingly, ended up getting

1107
01:14:42,160 --> 01:14:48,280
closed down. And, you know, was had present in front of

1108
01:14:48,280 --> 01:14:50,560
Congress, and there was a whole bunch of issues, you know, kind

1109
01:14:50,560 --> 01:14:56,380
of right, right off the bat, but, but very interestingly, you

1110
01:14:56,380 --> 01:14:58,780
know, I think a lot of the dialectics that were set up that

1111
01:14:58,780 --> 01:15:02,100
are now present in the. The GENIUS Act via the Gillibrand

1112
01:15:02,100 --> 01:15:06,660
Lummi stablecoin Bill was was was sewn during the the Libra

1113
01:15:06,660 --> 01:15:11,220
experiment, even though Libra themselves, you know, stated

1114
01:15:11,220 --> 01:15:14,280
that maybe regulatory pressure and uncertainty would mean that

1115
01:15:14,280 --> 01:15:18,720
this doesn't actually succeed. Interestingly enough, when it

1116
01:15:18,720 --> 01:15:21,560
was shut down by regulators, Libra sold off its assets to

1117
01:15:21,560 --> 01:15:27,380
Silvergate Bank, which ended up obviously going out, also going

1118
01:15:27,380 --> 01:15:30,800
under. And Silvergate was heavily involved with

1119
01:15:30,800 --> 01:15:33,380
MicroStrategy, which is the largest Bitcoin holder in the

1120
01:15:33,380 --> 01:15:37,760
world, domiciled in the US. They're based out of McLean,

1121
01:15:37,760 --> 01:15:41,380
Virginia, which is right by 15 minutes away from Langley, the

1122
01:15:41,380 --> 01:15:45,880
CIA's head office, and they were even partly owned by block one,

1123
01:15:45,880 --> 01:15:48,760
which was the parent company of Eos. Of all the people that I

1124
01:15:48,760 --> 01:15:54,220
just mentioned, kind of interesting. They operated the

1125
01:15:54,700 --> 01:15:58,600
silver gate exchange network Sen, which was, you know, the

1126
01:15:58,720 --> 01:16:02,820
biggest way that stablecoin providers were able to pass

1127
01:16:02,820 --> 01:16:05,880
around the bonds that back the stablecoins between each other.

1128
01:16:05,880 --> 01:16:09,360
So it was a crucial part of the stablecoin industry, very

1129
01:16:09,360 --> 01:16:13,620
interestingly. And so, you know, there's a lot to sort of pick at

1130
01:16:13,620 --> 01:16:18,480
there, but yeah, I think, you know, we're going to see stable

1131
01:16:18,480 --> 01:16:22,700
coins, you know, become issued by basically any company that

1132
01:16:22,700 --> 01:16:25,940
wants to, whether it's an AI company, whether it's Amazon,

1133
01:16:25,940 --> 01:16:31,160
whether it's Walmart, whether it's Twitter or X, whatever it

1134
01:16:31,160 --> 01:16:34,700
is. Now, you know, anybody that has a network of users is going

1135
01:16:34,700 --> 01:16:37,580
to issue a stablecoin, because now that we've allowed

1136
01:16:37,580 --> 01:16:40,100
regulation that as long as you buy government debt, you can

1137
01:16:40,100 --> 01:16:43,600
create your own money, you know, why wouldn't you? So we're going

1138
01:16:43,600 --> 01:16:47,140
to start to see that proliferate, I think, quite a

1139
01:16:47,140 --> 01:16:52,180
bit. And when you start to look at all the players here, you

1140
01:16:52,180 --> 01:16:55,960
know, these guys aren't, aren't necessarily always having their

1141
01:16:55,960 --> 01:16:59,800
customers in mind. And in fact, have built a lot of, you know,

1142
01:16:59,800 --> 01:17:05,160
really sketchy surveillance devices, you know, you really

1143
01:17:05,160 --> 01:17:09,480
look at what Tether, you know, has invested in, and it's

1144
01:17:09,480 --> 01:17:14,100
Blackrock neurotech, it's brain chips. It's, you know, that

1145
01:17:14,100 --> 01:17:17,640
surveillance company, cytologic that I discussed, a lot of these

1146
01:17:17,640 --> 01:17:20,900
things have pretty dangerous implications for the freedom of

1147
01:17:20,900 --> 01:17:25,100
humanity at scale, and we give them a money printer where they

1148
01:17:25,100 --> 01:17:29,900
can create, you know, trillions of dollars of capital. You know,

1149
01:17:29,900 --> 01:17:33,200
you can begin to see sort of an asymmetric advantage to these

1150
01:17:33,200 --> 01:17:38,900
private companies over behaviors and financial incentives of its

1151
01:17:38,900 --> 01:17:43,120
users. Which is, which is very scary. And one more point on

1152
01:17:43,120 --> 01:17:46,240
that, I think Paxos, which is the issuer of PayPal,

1153
01:17:46,240 --> 01:17:53,860
stablecoin, PY USD. It features two advisory members, Bill

1154
01:17:53,860 --> 01:17:59,320
Bradley, former senator, and Jim Manzi, who founded lotus, an

1155
01:17:59,320 --> 01:18:03,960
early software company. Both of them were investors and advisors

1156
01:18:03,960 --> 01:18:08,520
to cargo metrics, which was sort of the proto Satellogic, which

1157
01:18:08,520 --> 01:18:12,420
was a shipping and ocean analytics company that was

1158
01:18:12,420 --> 01:18:16,560
founded by Scott Borgeson, who was Ghislaine Maxwell's husband.

1159
01:18:17,940 --> 01:18:20,960
So you're beginning to see a bunch of connections with this.

1160
01:18:21,020 --> 01:18:24,620
You know, transnational, transgenerational, trans

1161
01:18:24,620 --> 01:18:27,980
fraternal intelligence organization, blackmail

1162
01:18:27,980 --> 01:18:32,120
organization, that, of course, you wrote the book on they have

1163
01:18:32,120 --> 01:18:35,900
their tentacles all over this thing. When you really start to

1164
01:18:35,900 --> 01:18:40,300
dig deep, whether it's Brock Pierce, whether it's Paxos or

1165
01:18:40,300 --> 01:18:45,520
just PayPal itself, you begin to see, kind of, hey, maybe there

1166
01:18:45,520 --> 01:18:48,940
isn't just this altruistic angle to all of this. Maybe this isn't

1167
01:18:48,940 --> 01:18:54,760
just carrot, and maybe there's a really dark, dirty panopticon

1168
01:18:54,760 --> 01:18:59,560
stick that is awaiting behind that final carrot to beat your

1169
01:18:59,560 --> 01:19:03,420
face in. So unfortunately, you have to sort of look at all of

1170
01:19:03,420 --> 01:19:08,880
this in conjunction to start to see, you know, why is a guy like

1171
01:19:08,880 --> 01:19:12,060
Bill Gross, who's the founder of IDEA Lab, you know? Why does he

1172
01:19:12,060 --> 01:19:16,200
run the largest data broker on human movement data in the world

1173
01:19:16,380 --> 01:19:21,740
with zero you know? You begin to see a lot of these data brokers

1174
01:19:21,740 --> 01:19:25,100
are all all over stablecoins. But if stablecoins are supposed

1175
01:19:25,100 --> 01:19:29,120
to be better than CBDCs, you know, why are they seemingly all

1176
01:19:29,120 --> 01:19:35,120
created by people that have, you know, a large investment in the

1177
01:19:35,120 --> 01:19:40,060
Panopticon surveillance state. So, yeah, I don't know. It's a

1178
01:19:40,060 --> 01:19:42,880
little scary when looking at it, you know, really zoomed in and

1179
01:19:42,880 --> 01:19:46,540
then really zoomed out, which, of course, is why we wrote this,

1180
01:19:46,540 --> 01:19:48,580
so that you can be informed, yeah.

1181
01:19:48,580 --> 01:19:51,460
And I mean, what you laid out is very important. And I

1182
01:19:51,460 --> 01:19:54,220
think when you consider on top of that, that Palantir, which

1183
01:19:54,220 --> 01:19:57,220
obviously is a, you know, Thiel link company, and thus linked to

1184
01:19:57,220 --> 01:19:59,380
this, you know, network we've been talking about today, quite

1185
01:19:59,380 --> 01:20:03,660
extensive. Lee. They've become very involved in the US

1186
01:20:03,660 --> 01:20:06,060
government under the second Trump term. They've become

1187
01:20:06,060 --> 01:20:11,640
involved with the IRS through the doge agency. They sort of

1188
01:20:11,640 --> 01:20:16,140
got access and hoover up data from most of the government.

1189
01:20:16,920 --> 01:20:21,080
They also there's a lot of Palantir Palantir alumni in the

1190
01:20:21,080 --> 01:20:24,200
government with major access to important data, particularly in

1191
01:20:24,200 --> 01:20:29,180
HHS, but Palantir manages US healthcare data anyway, so we

1192
01:20:29,180 --> 01:20:32,240
have that as well, in addition to your financial data. And

1193
01:20:32,300 --> 01:20:36,440
then, since we've brought it up a few times, Twitter or x I

1194
01:20:36,440 --> 01:20:42,040
guess, is now owned by Xai and is aiming to, of course, be per

1195
01:20:42,040 --> 01:20:44,800
mosque, capture the financial system. And they've also teamed

1196
01:20:44,800 --> 01:20:49,300
up with Palantir relatively recently. So, you know,

1197
01:20:49,300 --> 01:20:54,220
Palantir, of course, was always meant to be, you know, it's

1198
01:20:54,220 --> 01:20:56,440
really the private sector iteration is, you know, I've

1199
01:20:56,440 --> 01:20:59,080
talked about many times of this total information awareness

1200
01:20:59,080 --> 01:21:02,340
thing. It originally, though, of course, started off as the anti

1201
01:21:02,340 --> 01:21:06,480
fraud algorithm at PayPal before being turned into a privatized

1202
01:21:06,480 --> 01:21:10,800
version of that surveillance program. But the goal of Tia was

1203
01:21:10,800 --> 01:21:14,640
always not it's not just about finding crime that's happening

1204
01:21:14,640 --> 01:21:17,880
or has happened. It's about predicting crime that will

1205
01:21:17,880 --> 01:21:22,160
happen in the future. So if they think you might misspend Your

1206
01:21:22,160 --> 01:21:28,040
stablecoins, you know Palantir might flag your transaction. So

1207
01:21:28,040 --> 01:21:30,980
you don't even have to, necessarily, given the players

1208
01:21:31,220 --> 01:21:35,180
involved here do anything naughty to have your stable

1209
01:21:35,180 --> 01:21:39,140
coins potentially seized or have your wallet more surveilled than

1210
01:21:39,140 --> 01:21:43,900
another wallet, perhaps just the assumption that you may or be

1211
01:21:44,260 --> 01:21:47,200
flagged by palantir's algorithm, or an algorithm like it, that

1212
01:21:47,200 --> 01:21:51,160
you may participate in body activity could be enough to

1213
01:21:51,160 --> 01:21:54,100
trigger those things. And what a nightmare that would be. So

1214
01:21:55,420 --> 01:21:58,120
yeah, and I think you know, in the US, if a cbdc was

1215
01:21:58,120 --> 01:22:01,200
implemented, of course, Palantir would have also been involved.

1216
01:22:01,920 --> 01:22:05,340
But I think to think that it wouldn't be in this, you know,

1217
01:22:05,400 --> 01:22:10,260
new stablecoin, you know, world that we're being ushered into.

1218
01:22:10,260 --> 01:22:13,440
You know, it would be naive to not think that those things are

1219
01:22:13,440 --> 01:22:17,460
also at play here when you know it's Palantir is basically, you

1220
01:22:17,460 --> 01:22:21,920
know, become the government now in a lot of ways, which is

1221
01:22:21,920 --> 01:22:27,740
pretty, pretty unsettling. So yeah, I think people really need

1222
01:22:27,740 --> 01:22:31,040
to be aware of what's going on. The Chain is a great way to get

1223
01:22:31,040 --> 01:22:35,240
up to speed on that. But we also need to think about what we can

1224
01:22:35,240 --> 01:22:39,560
do and what we want to do with our data, what red lines we want

1225
01:22:39,560 --> 01:22:44,020
to have with how, with what type of things we interact with in

1226
01:22:44,020 --> 01:22:47,080
the digital digital world. Will stablecoins be a red line for

1227
01:22:47,080 --> 01:22:52,360
you? Will digital Id be a red line for you? Etc, etc, um. You

1228
01:22:52,360 --> 01:22:55,960
know, my concern, of course, is the deeper anyone allows

1229
01:22:55,960 --> 01:23:00,600
themselves to go into this, you know, this world that is being

1230
01:23:00,600 --> 01:23:03,240
built for us by the technocrats. The harder it will be. You know,

1231
01:23:03,240 --> 01:23:06,120
it's a slippery slope. The farther you go down the slippery

1232
01:23:06,120 --> 01:23:10,500
slope, the harder it is to get back up. So, you know, we should

1233
01:23:10,500 --> 01:23:14,880
be pretty careful about what we allow ourselves to become

1234
01:23:14,880 --> 01:23:18,240
entangled with, and that includes financially. So as we

1235
01:23:18,240 --> 01:23:21,380
wrap up, wrap up here, Mark, I don't know if you want to add

1236
01:23:21,380 --> 01:23:24,320
anything on that point, or if you have any other potential

1237
01:23:24,320 --> 01:23:27,380
solutions you'd like to field for the audience.

1238
01:23:27,980 --> 01:23:30,860
Well, before you get into solutions, you know, it's really

1239
01:23:30,860 --> 01:23:34,640
just informing yourself, as I kind of said at the top, you

1240
01:23:34,640 --> 01:23:39,680
know, this is going to be something that affects everybody

1241
01:23:39,680 --> 01:23:41,920
on the planet, whether or not you use the stablecoin,

1242
01:23:41,920 --> 01:23:46,240
specifically yourself, this new financial system that is, that

1243
01:23:46,240 --> 01:23:53,200
is an inevitability is going to affect in mass, everybody. And,

1244
01:23:53,260 --> 01:23:57,520
you know, you begin to learn about, you know, how we got

1245
01:23:57,520 --> 01:24:01,680
here, the history of the dollar system, and then the history of

1246
01:24:01,680 --> 01:24:04,980
of, you know, sort of information, banking, you know,

1247
01:24:04,980 --> 01:24:07,740
really, I think the first piece, which, you know, again, we're

1248
01:24:07,740 --> 01:24:10,020
wrapping up, we didn't really talk that much about, about

1249
01:24:10,020 --> 01:24:14,820
Zappo, and sort of, they are the people that really built the,

1250
01:24:14,820 --> 01:24:19,320
the first iteration of the Bitcoin dollar, you know, you

1251
01:24:19,320 --> 01:24:23,300
look at the people that were on its founding board. And you see,

1252
01:24:23,360 --> 01:24:27,860
you know, Larry Summers, which, of course, you know, is a goal

1253
01:24:27,860 --> 01:24:30,860
with Epstein connections and Treasury connections and and

1254
01:24:30,860 --> 01:24:33,260
what have you. But then you also see these guys that really

1255
01:24:33,260 --> 01:24:37,700
played a very early role in, you know, the creation of

1256
01:24:37,700 --> 01:24:41,140
information banking, with D Hawk of visa and John Reed of Citi,

1257
01:24:41,140 --> 01:24:44,200
which were really the first big institutions that really

1258
01:24:44,200 --> 01:24:48,520
digitized money, before PayPal, and the fact that they are all

1259
01:24:48,520 --> 01:24:51,520
on this board of Zappo, which is, you know, Wences gas and

1260
01:24:51,520 --> 01:24:55,660
another PayPal board member, all really talking heavily about

1261
01:24:55,660 --> 01:25:01,260
Bitcoin and about stablecoins. You can come. Kind of begin to

1262
01:25:01,260 --> 01:25:04,500
kind of zoom out and see that this is a really a decades long

1263
01:25:04,500 --> 01:25:08,460
play by the intelligence and banking communities to create a

1264
01:25:08,460 --> 01:25:12,420
new financial system to deal with the effects of being in a

1265
01:25:12,420 --> 01:25:17,340
fiat system. And so, you know, these guys don't really lose

1266
01:25:17,340 --> 01:25:23,420
very often, if ever, and they are very clever at creating the

1267
01:25:23,420 --> 01:25:26,840
bubbles and then creating the pin that pops the bubbles and

1268
01:25:26,840 --> 01:25:30,020
creating the vacuum that sucks in the air that was inside that

1269
01:25:30,020 --> 01:25:33,620
balloon into the next balloon, into the next system. And I

1270
01:25:33,620 --> 01:25:39,440
think it's very clear that that system is being built. I you

1271
01:25:39,440 --> 01:25:42,400
know, obviously propose that it is this Bitcoin, dollar system

1272
01:25:42,400 --> 01:25:47,020
with stablecoins and Bitcoin and so if you look at the

1273
01:25:47,020 --> 01:25:49,660
history of these players, they've really done everything

1274
01:25:49,660 --> 01:25:54,460
they needed to do to have the dollar survive and move on to

1275
01:25:54,460 --> 01:25:58,120
the next iteration, the next evolution of the dollar. We've

1276
01:25:58,120 --> 01:26:00,900
seen digital dollars for a long time. Now. We're seeing these

1277
01:26:01,020 --> 01:26:05,160
tokenized dollars on blockchains. I don't think this

1278
01:26:05,160 --> 01:26:08,520
evolution is just going to stop. It has never stopped in the

1279
01:26:08,520 --> 01:26:12,240
history of you know, these, these, these private sector

1280
01:26:12,240 --> 01:26:15,120
companies building things out at the behest of the public sector.

1281
01:26:15,120 --> 01:26:19,200
That will continue. So this is going to happen historically.

1282
01:26:19,800 --> 01:26:22,940
All the evidence points to them being very successful at this.

1283
01:26:23,120 --> 01:26:26,480
So the key is, sort of, you know, the solution here, which

1284
01:26:26,480 --> 01:26:30,740
was your question is like, Well, how do I handle this pin

1285
01:26:30,740 --> 01:26:33,200
popping, this controlled demolition? How do I best

1286
01:26:33,200 --> 01:26:37,520
navigate that? And when it comes to finances, it's very personal,

1287
01:26:37,700 --> 01:26:40,480
and I don't, I'm not a, I'm not a financial advisor. And I

1288
01:26:40,480 --> 01:26:43,720
don't, I don't, I hope you don't take anything, I say, as

1289
01:26:43,720 --> 01:26:47,860
financial advice. Really take it as information to figure out

1290
01:26:47,860 --> 01:26:51,820
what it is that you want to do, because I'm not going to poo poo

1291
01:26:51,820 --> 01:26:55,240
anybody doing what they need to do to take care of themselves

1292
01:26:55,240 --> 01:26:58,720
and their family, if they need to use some of these instruments

1293
01:26:58,720 --> 01:27:03,540
to survive in the short term, or to speculate on them to survive

1294
01:27:03,540 --> 01:27:08,580
in this wealth transfer, I think that you have to do what you

1295
01:27:08,580 --> 01:27:11,700
need to do, but just be very careful and be very aware of

1296
01:27:11,700 --> 01:27:14,340
what you're signing yourself up for when you use these products

1297
01:27:14,340 --> 01:27:17,400
and use these systems, and make sure you know that the

1298
01:27:17,400 --> 01:27:22,340
conveniences that you Accept are very often going to be shortly

1299
01:27:22,340 --> 01:27:29,420
followed with some form of a stick in your face. And so, from

1300
01:27:29,420 --> 01:27:32,720
a solution standpoint, all solutions come downstream of

1301
01:27:32,720 --> 01:27:37,520
information and being informed. So obviously, that was the point

1302
01:27:37,520 --> 01:27:40,540
of this pod. That was the point of The Chain. That was the point

1303
01:27:40,540 --> 01:27:44,320
of, you know, a lot of our work, you know, spanning quite a bit

1304
01:27:44,320 --> 01:27:49,480
of time here now. So take a look at it. See what you see, what

1305
01:27:49,480 --> 01:27:52,480
you what you glean from it, and then make a decision where your

1306
01:27:52,480 --> 01:27:55,120
line is, as as Whitney said earlier, you know, as you said

1307
01:27:55,120 --> 01:28:00,100
earlier, where is your line. And draw that very carefully and and

1308
01:28:00,100 --> 01:28:02,460
stick to it, because they're going to feed you a lot of

1309
01:28:02,460 --> 01:28:06,180
conveniences that are going to be really double edged swords.

1310
01:28:06,900 --> 01:28:10,020
So make sure that you remember, you know, humans are more

1311
01:28:10,020 --> 01:28:13,500
important than machines, and we're very powerful beings, and

1312
01:28:13,500 --> 01:28:16,920
we can do a lot of really cool stuff if we lean into our local

1313
01:28:16,920 --> 01:28:21,200
communities, lean into our families, and, you know, let's

1314
01:28:21,200 --> 01:28:25,520
not let AI take over everything. Let's create art, do fun things,

1315
01:28:25,700 --> 01:28:29,180
go in the forest, throw your phone in the river, and get out

1316
01:28:29,180 --> 01:28:32,720
there and touch grass every once in a while, and get to know your

1317
01:28:32,720 --> 01:28:35,900
neighbors. So that you can find ways to circumnavigate this

1318
01:28:35,900 --> 01:28:40,840
panopticon financial system, via barter, via via trust. You know

1319
01:28:40,840 --> 01:28:45,520
you cannot replace trust with a with a digital system. Trust

1320
01:28:45,520 --> 01:28:49,720
comes between two people, and so go out and find other people

1321
01:28:49,720 --> 01:28:53,800
that you can trust and create alternatives to something that

1322
01:28:53,860 --> 01:28:58,240
is inevitably going to globalize and take over a giant part of

1323
01:28:58,240 --> 01:29:02,460
the world. So the solution comes downstream from information, and

1324
01:29:02,460 --> 01:29:05,280
then the ability to create alternative structures comes

1325
01:29:05,280 --> 01:29:08,760
from you going out there and building them yourself, whether

1326
01:29:08,760 --> 01:29:13,320
they're technology based or not, you have to build the solutions

1327
01:29:13,920 --> 01:29:16,860
that are necessary for you and your people and your family. So

1328
01:29:17,280 --> 01:29:20,600
get yourself informed and get out there and build the tools

1329
01:29:20,600 --> 01:29:22,280
that you need to live the life that you want.

1330
01:29:23,240 --> 01:29:27,620
Wow, that was beautifully stated. Thanks a lot, Mark, and

1331
01:29:27,620 --> 01:29:31,460
thanks a lot for being here today and sharing all of this

1332
01:29:31,460 --> 01:29:35,120
information with everybody. So anything you'd like, as we wrap

1333
01:29:35,120 --> 01:29:38,480
up here, anything you'd like to let people know about what's

1334
01:29:38,480 --> 01:29:41,260
coming up for you, how they can support your work and how they

1335
01:29:41,260 --> 01:29:41,440
can

1336
01:29:41,440 --> 01:29:44,800
follow you. Well, thankfully, it's very easy.

1337
01:29:44,800 --> 01:29:48,700
You're probably already on the page right now, but, you know,

1338
01:29:48,700 --> 01:29:51,400
I'm writing now for unlimited hangout. Very happy to be here.

1339
01:29:51,400 --> 01:29:55,540
Thank you so much. It's an honor. A lot of fun. We'll be

1340
01:29:55,540 --> 01:29:58,720
continuing to write for Unlimited Hangout. We're going

1341
01:29:58,720 --> 01:30:01,920
to be doing some fun things here. In the future, perhaps

1342
01:30:02,220 --> 01:30:06,780
this chain turned into a book, perhaps a print magazine is

1343
01:30:06,780 --> 01:30:09,060
going to be in the work. So a lot of fun things going to be

1344
01:30:09,060 --> 01:30:13,920
coming out of, you know, me working with Unlimited Hangout.

1345
01:30:13,920 --> 01:30:16,980
And, you know, again, just thank you so much for following. I'm

1346
01:30:16,980 --> 01:30:20,220
on Twitter, but trying not to be on there as much these days,

1347
01:30:20,640 --> 01:30:23,840
trying to really go to publish only. So check out the author

1348
01:30:23,840 --> 01:30:27,860
page on Unlimited Hangout and check out The Chain. You can

1349
01:30:27,860 --> 01:30:31,040
access an Unlimited Hangout, and I made a nice little URL that's

1350
01:30:31,040 --> 01:30:34,220
The Chain dot wiki that brings you right to the investigative

1351
01:30:34,220 --> 01:30:37,760
series page, so you can check it out there. It's a long read, but

1352
01:30:38,000 --> 01:30:42,100
break it up over time and and get in there and inform

1353
01:30:42,100 --> 01:30:42,580
yourself.

1354
01:30:43,240 --> 01:30:45,340
Awesome. Well, thanks Mark and thanks everybody for

1355
01:30:45,340 --> 01:30:47,200
listening. We'll catch you all in the next episode.