1 00:00:00,400 --> 00:00:03,600 Why is nothing working? Why is nothing fucking working? 2 00:00:03,600 --> 00:00:05,800 You piece of shit. Fucking phone. 3 00:00:06,800 --> 00:00:09,100 Fuck. Oh my god, dude. 4 00:00:09,400 --> 00:00:11,800 I don't know where we were. I don't even know where we were. 5 00:00:12,400 --> 00:00:14,100 I don't know. Now, I'm just flustered and 6 00:00:14,100 --> 00:00:17,200 pissed. And look, there's a mosquito, 7 00:00:17,700 --> 00:00:23,100 there's a fucking mosquitoes. I'm not going to let go. 8 00:00:37,200 --> 00:00:46,800 Okay, welcome back everyone. I am Caspian Sea and I'm joined 9 00:00:46,800 --> 00:00:49,500 as usual by my partner in crime. Mr. Bennett Tomlin how are you 10 00:00:49,500 --> 00:00:51,300 today? I'm doing pretty well Cass. 11 00:00:51,300 --> 00:00:52,600 How are you? I'm doing fine. 12 00:00:52,600 --> 00:00:55,300 We're having some technical difficulties to start this out. 13 00:00:55,300 --> 00:00:58,500 But today, we're going to be talking about insider trading. 14 00:00:58,500 --> 00:01:02,000 A weird instance of it. A lot of people are confused. 15 00:01:02,200 --> 00:01:03,800 A lot of people don't really understand. 16 00:01:03,900 --> 00:01:07,900 What the claims are and how they could possibly be justified. 17 00:01:08,100 --> 00:01:10,700 So yeah, we're going to talk about Nathaniel Chastain. 18 00:01:10,700 --> 00:01:14,300 Nate Chastain for short. He worked at Open Sea, which is 19 00:01:14,300 --> 00:01:18,100 the world's largest nft Marketplace I believe. 20 00:01:18,100 --> 00:01:20,100 So let's talk about Nate Chastain. 21 00:01:20,100 --> 00:01:24,500 Why he is in trouble and how we got here, so Bennett. 22 00:01:24,500 --> 00:01:29,200 Can you explain what he did? Yeah, so mate for open sea, was 23 00:01:29,200 --> 00:01:32,200 in charge of deciding what nft projects were going to be 24 00:01:32,200 --> 00:01:36,700 featured on the front page. Page of Open Sea and repeatedly 25 00:01:36,700 --> 00:01:40,700 for several months what he kept doing was using a bunch of 26 00:01:40,700 --> 00:01:45,400 anonymous wallets to purchase from these nft collections right 27 00:01:45,400 --> 00:01:47,700 before he would feature them on the front page. 28 00:01:47,700 --> 00:01:51,000 Choose them to be featured on the front page and then sell 29 00:01:51,000 --> 00:01:54,100 them immediately afterwards. Often netting himself 30 00:01:54,100 --> 00:01:57,900 substantial profits compared to his cause he did this for 31 00:01:57,900 --> 00:02:01,400 several months ended up with a total profit of around. 19, 32 00:02:01,400 --> 00:02:05,300 ether, if I remember, right? And did it on, Total of like 45 33 00:02:05,300 --> 00:02:07,300 different NF teas, or something like that. 34 00:02:07,700 --> 00:02:11,600 And when it was finally publicly revealed things to the work of a 35 00:02:11,600 --> 00:02:15,000 few people in crypto, Twitter, he ended up resigning from open 36 00:02:15,000 --> 00:02:19,200 sea and very recently, we saw the southern district of New 37 00:02:19,200 --> 00:02:21,100 York. Drop these indictments against 38 00:02:21,100 --> 00:02:23,600 him correct. And so, let me go ahead and get 39 00:02:23,600 --> 00:02:26,200 into these indictments for everybody. 40 00:02:26,200 --> 00:02:28,900 I have this called up. We'll go ahead and plop the link 41 00:02:28,900 --> 00:02:33,700 into the description for the episode The sdn. 42 00:02:33,700 --> 00:02:38,200 Why Guy says former employee of nft marketplace charged in first 43 00:02:38,200 --> 00:02:42,000 ever digital asset, insider trading scheme Nathaniel 44 00:02:42,000 --> 00:02:44,100 Chastain. A former product manager at 45 00:02:44,100 --> 00:02:46,800 ozone networks. Incorporated, doing business as 46 00:02:46,800 --> 00:02:49,400 open sea is charged with wire fraud and money. 47 00:02:49,400 --> 00:02:52,800 Laundering in connection with a scheme to commit insider trading 48 00:02:52,800 --> 00:02:56,400 in non fungible tokens or n f TS by using confidential 49 00:02:56,400 --> 00:02:59,700 information about what nft he's were going to be featured on 50 00:02:59,700 --> 00:03:03,700 Open, Seas homepage, for his personal financial gain chest. 51 00:03:03,900 --> 00:03:06,900 Was arrested this morning in New York, New York and will be 52 00:03:06,900 --> 00:03:09,400 presented today in the United States district court for the 53 00:03:09,400 --> 00:03:14,700 southern district of New York. So a lot of people were getting 54 00:03:14,700 --> 00:03:19,400 very kind of confused and upset about this, they suggested 55 00:03:19,400 --> 00:03:25,100 there's no precedent that claims that nft s are a security. 56 00:03:25,400 --> 00:03:29,700 They saw this as essentially Nate being charged with insider 57 00:03:29,700 --> 00:03:34,300 trading and it being related to a Securities charge Can you 58 00:03:34,300 --> 00:03:36,300 discuss why that indeed is not the case. 59 00:03:36,800 --> 00:03:39,300 Well, because they're not pursuing him under any of the 60 00:03:39,300 --> 00:03:42,400 Securities fraud related Frameworks, right? 61 00:03:43,100 --> 00:03:46,400 They're not going after him for like a Securities fraud 62 00:03:46,400 --> 00:03:50,400 violation than going with the much broader wire fraud which is 63 00:03:51,000 --> 00:03:54,800 basically using any Communications Network in a 64 00:03:54,800 --> 00:03:58,300 deceitful way to make money ends up covered under wire fraud. 65 00:03:58,300 --> 00:04:01,100 I'm not a lawyer, that's not a technical definition but if you 66 00:04:01,100 --> 00:04:03,700 do something to seek full and use communication Networks, 67 00:04:04,000 --> 00:04:06,800 There's a good chance you could end up charged with wire fraud 68 00:04:06,900 --> 00:04:09,800 and so they're not claiming he Insider traded Securities. 69 00:04:09,800 --> 00:04:13,100 They're claiming he used this confidential information in a 70 00:04:13,108 --> 00:04:17,000 deceitful way to profit and use these communication networks in 71 00:04:17,000 --> 00:04:19,000 order to do it. And as such, they're charging 72 00:04:19,000 --> 00:04:22,500 him with wire fraud, well, wire fraud and money, laundering, and 73 00:04:22,500 --> 00:04:24,800 the money laundering is and we talked about this little bit on 74 00:04:24,800 --> 00:04:26,700 our episode with Josh Cincinnati, right? 75 00:04:26,700 --> 00:04:29,400 Is the definition of money. Laundering is so broad that 76 00:04:29,400 --> 00:04:32,600 anytime you basically touch money connected to a criminal 77 00:04:32,600 --> 00:04:35,000 act, you can end up Charged with money laundering. 78 00:04:35,000 --> 00:04:37,500 So he did this thing. If you ends up charged with wire 79 00:04:37,500 --> 00:04:40,900 fraud than anything, he did with the money, that resulted ends up 80 00:04:40,900 --> 00:04:42,700 being called money laundering, right? 81 00:04:42,700 --> 00:04:45,800 We end up in this situation where he's not being charged for 82 00:04:45,800 --> 00:04:49,400 the Securities fraud violation. But because he still profited in 83 00:04:49,400 --> 00:04:52,700 this deceitful way, they're still able to charge him with 84 00:04:52,700 --> 00:04:56,200 fraud, which is the important takeaway I think people need to 85 00:04:56,200 --> 00:04:58,400 remember. It's like it's insider trading 86 00:04:58,400 --> 00:05:01,900 but it's not write like this is, this is wire fraud, this is 87 00:05:01,900 --> 00:05:03,700 money laundering, that's the charges. 88 00:05:04,000 --> 00:05:06,700 And there's no precedent setting, kind of craziness, 89 00:05:06,700 --> 00:05:09,100 that's going to be happening with this case as far as I can 90 00:05:09,100 --> 00:05:12,000 tell. Now again, as you stated 91 00:05:12,000 --> 00:05:15,900 importantly, neither of us are lawyers, neither of us know what 92 00:05:15,900 --> 00:05:17,600 the hell were talking about when it comes to law. 93 00:05:17,600 --> 00:05:22,700 Don't trust us to understand whether this is a slam-dunk case 94 00:05:22,700 --> 00:05:26,300 or whether Nate is going to totally get away with it. 95 00:05:26,300 --> 00:05:30,200 And all that, who knows innocent until proven guilty, I think, is 96 00:05:30,700 --> 00:05:35,000 what we need to always work. Also as Much as it seems like 97 00:05:35,200 --> 00:05:39,900 pretty obvious that need did this and like he could very well 98 00:05:39,900 --> 00:05:43,200 get charged, who knows. But that brings us to a really 99 00:05:43,200 --> 00:05:49,100 good point because I think the public doesn't usually reflect 100 00:05:49,100 --> 00:05:53,600 on cases like this and see at the beginning that it was the 101 00:05:53,600 --> 00:05:56,500 public, who kind of called this guy out. 102 00:05:56,500 --> 00:05:58,900 It wasn't a journalist, it wasn't a reporter. 103 00:05:59,100 --> 00:06:02,500 It wasn't a short seller doing a short sale report. 104 00:06:02,700 --> 00:06:05,300 It was somebody On cryptocurrency Twitter. 105 00:06:05,700 --> 00:06:10,400 And if I remember right, it was at zero X Zu. 106 00:06:10,400 --> 00:06:13,500 Whoo-hoo first tweeted on like September 14th. 107 00:06:13,500 --> 00:06:15,900 Hey Ed open. See why does it appear at Nate? 108 00:06:15,900 --> 00:06:18,400 Chastain has a few secret wallets that he appears to buy 109 00:06:18,400 --> 00:06:20,700 your front page drops before they're listed. 110 00:06:20,700 --> 00:06:23,400 Then sells them shortly after the front page, Hypes bike for 111 00:06:23,400 --> 00:06:26,200 profits and then tumbles them back to his main wallet with his 112 00:06:26,200 --> 00:06:30,000 punk on it. Which one Nate Nate, you're 113 00:06:30,000 --> 00:06:33,000 working for a crypto company. How in the world did you think 114 00:06:33,000 --> 00:06:35,000 tumbling back? Back to your wallet with the 115 00:06:35,000 --> 00:06:37,100 pumpkin. It was a good idea. 116 00:06:37,300 --> 00:06:40,400 Yeah. Your entire job is NF T's in 117 00:06:40,400 --> 00:06:43,700 crypto and you sent them back to your wallet with your most 118 00:06:43,700 --> 00:06:48,500 identifiable crypto in it. You're like, oh, but no, you're 119 00:06:48,500 --> 00:06:51,000 right that this was a case that basically crypto Twitter 120 00:06:51,000 --> 00:06:55,300 exposed, these individuals, like at zero X zoom and because of 121 00:06:55,300 --> 00:06:57,300 that, Nate ended up having to resign. 122 00:06:57,300 --> 00:07:00,600 And that what the potential harm he could do was mitigated in 123 00:07:00,600 --> 00:07:03,700 that way. And the side effect is because 124 00:07:03,900 --> 00:07:06,900 Is all a public Ledger once these individuals had documented 125 00:07:06,900 --> 00:07:08,900 their work and shown these transactions. 126 00:07:09,200 --> 00:07:13,300 They gave the like facts of the case in the flow of the funds 127 00:07:13,300 --> 00:07:17,100 were all there in public for the feds to read and use for their 128 00:07:17,100 --> 00:07:20,500 prosecution and and look you and I we don't know if somebody 129 00:07:20,500 --> 00:07:23,800 reported this to get a whistleblower reward, we don't 130 00:07:23,800 --> 00:07:25,300 know. We have no idea what the 131 00:07:25,308 --> 00:07:28,700 behind-the-scenes was for this, but what I think people should 132 00:07:28,700 --> 00:07:32,200 consider and what people I saw people considering this on 133 00:07:32,200 --> 00:07:34,700 cryptocurrency Twitter. A lot of people were joking 134 00:07:34,700 --> 00:07:37,700 like, oh God, they got him for that. 135 00:07:38,000 --> 00:07:42,400 Well, I think I've probably done that a few times and there 136 00:07:42,400 --> 00:07:45,300 seemed to be a lot of, oh, fuck. This could be me. 137 00:07:45,300 --> 00:07:48,400 Energy coming from cryptocurrency, Twitter about 138 00:07:48,400 --> 00:07:51,100 this? I think that's good, huh? 139 00:07:51,200 --> 00:07:54,800 I think that people should be concerned about doing things, 140 00:07:54,800 --> 00:07:58,000 like bank and wire fraud money, laundering insider trading. 141 00:07:58,000 --> 00:08:00,900 You, you should be concerned. These are things that can apply 142 00:08:01,100 --> 00:08:05,200 to almost any industry and To think you could get away with it 143 00:08:05,200 --> 00:08:09,400 because you maybe did an okay job with your opsec your 144 00:08:09,400 --> 00:08:14,000 operational security is banking on a lot that you're you've done 145 00:08:14,000 --> 00:08:16,700 a good job and you probably haven't it's good for them to 146 00:08:16,700 --> 00:08:20,300 know not only our Regulators paying attention to this stuff 147 00:08:20,700 --> 00:08:22,900 but they're probably on cryptocurrency Twitter. 148 00:08:23,100 --> 00:08:26,100 They're probably they're they're probably monitoring the space 149 00:08:26,200 --> 00:08:29,100 and they're reading your tweets. This is proof that that is what 150 00:08:29,100 --> 00:08:33,299 can and does happen is that they pay attention to. 151 00:08:33,799 --> 00:08:36,600 Leslie illegal stuff to our amateur eyes. 152 00:08:36,600 --> 00:08:40,299 It appears to be a pretty slam-dunk case and perhaps 153 00:08:40,299 --> 00:08:42,600 that's why they decided to go after him. 154 00:08:43,200 --> 00:08:46,000 Yeah, I mean I think that is exactly why they chose to go 155 00:08:46,000 --> 00:08:49,200 after him that for the southern district of New York who has a 156 00:08:49,200 --> 00:08:53,100 really high conviction rate on wire fraud cases. 157 00:08:53,100 --> 00:08:56,500 This seemed like a really good opportunity to get a wire fraud 158 00:08:56,500 --> 00:08:59,500 conviction and that once you've proven, you can easily get a 159 00:08:59,508 --> 00:09:04,300 wire fraud conviction for someone in the digital a Set 160 00:09:04,400 --> 00:09:07,200 space using this type of knowledge to make this kind of 161 00:09:07,200 --> 00:09:10,900 profit. I imagine that it is within the 162 00:09:10,900 --> 00:09:14,200 capabilities of the southern district of New York to identify 163 00:09:14,200 --> 00:09:17,200 other people in cryptocurrency who have profited in similar 164 00:09:17,200 --> 00:09:19,800 ways. And so, yeah, I think that's 165 00:09:19,800 --> 00:09:21,700 really why this case could potentially be. 166 00:09:21,700 --> 00:09:26,000 So impactful is because this kind of stuff is pervasive. 167 00:09:27,300 --> 00:09:32,200 There are tons and tons of people in crypto and in the nft 168 00:09:32,200 --> 00:09:37,000 space Developers like members of teams, whatever who are all the 169 00:09:37,000 --> 00:09:41,100 time trading on privileged information and even many of the 170 00:09:41,100 --> 00:09:46,400 stalwart institutions in the space, have some activities and 171 00:09:46,400 --> 00:09:51,500 behavior that looks suspicious like coinbase for years has been 172 00:09:51,500 --> 00:09:55,700 accused that their listings are basically predicated on what 173 00:09:55,700 --> 00:09:58,700 coinbase investors have invested in to make sure that they can 174 00:09:58,700 --> 00:10:02,100 get their liquidity, this case is important because this case 175 00:10:02,100 --> 00:10:04,300 shows that the federal government has a lot of Tools to 176 00:10:04,300 --> 00:10:07,600 pursue this kind of bad behavior and that even without proving 177 00:10:07,600 --> 00:10:10,600 that your little token is a security, they can still go 178 00:10:10,600 --> 00:10:13,300 after you for many of the bad things you do with that little 179 00:10:13,300 --> 00:10:16,200 token. It's very important to realize 180 00:10:16,200 --> 00:10:20,100 that, that, that people seem to think they can outwit the 181 00:10:20,100 --> 00:10:23,700 government by being like, Oh, it's not a security or I'm not 182 00:10:23,700 --> 00:10:25,500 in your jurisdiction or whatever. 183 00:10:25,500 --> 00:10:29,000 They're silly silly excuses, and I can just tell you that those 184 00:10:29,000 --> 00:10:34,900 excuses do not work as Aaron Wise Journalist at Proto's 185 00:10:34,900 --> 00:10:38,400 pointed out, you know bit Max hat was running a prop desk 186 00:10:38,400 --> 00:10:43,400 against its customers. We have Bad actors all over the 187 00:10:43,400 --> 00:10:49,000 place, treating their customers like total horseshit and it is 188 00:10:49,100 --> 00:10:51,100 rampant. It is obvious in the 189 00:10:51,100 --> 00:10:53,300 cryptocurrency space. I don't think anyone would deny 190 00:10:53,300 --> 00:10:55,300 that we need to pause in that point you're making there 191 00:10:55,300 --> 00:10:57,900 because yeah it's really pervasive. 192 00:10:57,900 --> 00:11:01,000 Coinbase has coinbase Ventures. Finance has financed Ventures 193 00:11:01,200 --> 00:11:03,300 bitfenix has fulgor. Elephant blue b. 194 00:11:03,300 --> 00:11:06,800 Kappa And a couple of other firms, they have bit, Max had 195 00:11:06,800 --> 00:11:10,200 their own prop desk. There is so much of that type of 196 00:11:10,200 --> 00:11:13,200 activity at so many exchanges, including the ones who like very 197 00:11:13,200 --> 00:11:16,500 deliberately try to Market themselves as regulated in like 198 00:11:16,600 --> 00:11:19,400 following the good behavior still doing that kind of thing. 199 00:11:20,300 --> 00:11:22,700 And I think this probably leads into what you were about to go 200 00:11:22,700 --> 00:11:26,300 do is that Nate's facing like a potential maximum sentence of 40 201 00:11:26,300 --> 00:11:29,600 years, if these ran consecutively and we compare 202 00:11:29,600 --> 00:11:32,900 that to the sentences for the bit, Max Founders, or for 203 00:11:32,900 --> 00:11:36,600 example, the Ville settlement. That black one had for Eos and 204 00:11:36,600 --> 00:11:40,500 it seems strange. It seems worse than strange. 205 00:11:40,500 --> 00:11:44,000 It seems worse than strange. I know people are probably more 206 00:11:44,000 --> 00:11:47,900 used to me getting upset on this podcast than you, but it does it 207 00:11:47,900 --> 00:11:52,100 really bothers me? This idea that Nate who no one's 208 00:11:52,100 --> 00:11:55,600 going to deny that, what he did was wrong and that he should get 209 00:11:55,600 --> 00:11:58,800 punished for it. I think that is 100% true. 210 00:11:59,500 --> 00:12:02,300 Everyone agrees. No one's going to deny that, no 211 00:12:02,300 --> 00:12:07,200 one. Update the the problem I have 212 00:12:07,200 --> 00:12:12,300 with this is that and we see this as not it's not only this 213 00:12:12,300 --> 00:12:14,300 is not restricted to cryptocurrency, this isn't 214 00:12:14,300 --> 00:12:16,100 finances. Totally like it's every 215 00:12:16,100 --> 00:12:21,600 Financial market place like I think that I don't remember what 216 00:12:21,600 --> 00:12:25,900 that guy's name was the dude who the SEC went after for insider 217 00:12:25,900 --> 00:12:29,300 trading and he had done like a hundred ninety five thousand 218 00:12:29,300 --> 00:12:32,100 dollars worth of insider trading and lost all of the money that 219 00:12:32,100 --> 00:12:34,900 he had Insider Charlie kid. He did a bad job insider 220 00:12:34,900 --> 00:12:37,000 trading, there's nothing to even catch him on. 221 00:12:37,100 --> 00:12:41,700 They nailed him to a cross and it's like, guys, what the fuck 222 00:12:41,700 --> 00:12:43,600 are you doing? Oh, you think Nate. 223 00:12:43,600 --> 00:12:45,700 Chastain is the problem in cryptocurrency. 224 00:12:46,100 --> 00:12:49,700 Granted he's a part of the problem, but do you think 225 00:12:49,700 --> 00:12:52,700 slapping block one with a billion-dollar fine or whatever? 226 00:12:52,700 --> 00:12:53,900 It was? I don't even remember. 227 00:12:53,900 --> 00:12:56,700 Probably less than that, right? Like, that's Yahweh less, right? 228 00:12:56,800 --> 00:12:59,600 So, so you slap block one with a tiny fine for their 229 00:12:59,600 --> 00:13:03,600 multibillion-dollar bullshit who is going to take you? 230 00:13:03,700 --> 00:13:06,900 Lee and how are you, how are you disproving? 231 00:13:06,900 --> 00:13:10,100 The people who say, oh all you need to get past. 232 00:13:10,100 --> 00:13:13,500 The Regulators is a team of good lawyers and a shit ton of money. 233 00:13:13,700 --> 00:13:17,200 If you're poor, you're fucked. But if you're Rich As Fuck, you 234 00:13:17,200 --> 00:13:18,500 can just have your way with them. 235 00:13:18,500 --> 00:13:21,800 And I it's unfortunate because it sure feels like that's real, 236 00:13:21,900 --> 00:13:22,800 right? It feels like that. 237 00:13:22,800 --> 00:13:24,800 Is the reality on the ground. Yeah. 238 00:13:24,800 --> 00:13:28,200 So for those who are unaware, black one raised four billion 239 00:13:28,200 --> 00:13:31,600 dollars for Eos and another billion dollars from selling 240 00:13:31,600 --> 00:13:36,200 their Equity with Many accusations of wash trading, 241 00:13:36,200 --> 00:13:39,000 insider trading privileged information and stuff during the 242 00:13:39,000 --> 00:13:41,600 sale. And then we're find 24 million 243 00:13:41,600 --> 00:13:50,500 dollars, not 1 billion, 24 million 2.5% of a billion. 244 00:13:50,800 --> 00:13:54,600 And then the government cries about how there's all this 245 00:13:54,600 --> 00:13:57,100 bullshit going on in cryptocurrency, oh my God, the 246 00:13:57,100 --> 00:13:59,800 industry is Rife with fraud and scams. 247 00:14:00,400 --> 00:14:03,600 Well hello what the fuck were you? 248 00:14:03,700 --> 00:14:07,100 Doing in 2017. Genuinely, what the actual fuck 249 00:14:07,100 --> 00:14:09,600 were you doing? You slap them slapped, an 250 00:14:09,600 --> 00:14:13,300 obvious obvious rule-breaking company, that was breaking, 251 00:14:13,300 --> 00:14:17,300 every rule that you guys have set up for this stuff. 252 00:14:17,800 --> 00:14:20,600 And at the end, you said here's a tiny little fine. 253 00:14:21,200 --> 00:14:25,600 Meanwhile, your subjugating. This this dude who I'm sure if I 254 00:14:25,600 --> 00:14:28,700 met him, I wouldn't like him. I'm sure he's a total tool but 255 00:14:28,700 --> 00:14:31,600 like 40 years in prison. What the fuck? 256 00:14:31,600 --> 00:14:33,500 Are you smoking? What in, what? 257 00:14:33,600 --> 00:14:36,000 Reality. Does this seem like a fair 258 00:14:36,100 --> 00:14:38,800 reasonable set of rules and implications? 259 00:14:39,000 --> 00:14:42,000 We're like yeah. Maybe the one good time. 260 00:14:42,000 --> 00:14:46,700 I've seen them do a bang-up job and it was 25 years after they 261 00:14:46,700 --> 00:14:49,600 should have done it in the first place, was with Bernie Madoff. 262 00:14:49,600 --> 00:14:50,900 Yep. The guy, deserved a life 263 00:14:50,900 --> 00:14:52,100 sentence. Great. 264 00:14:52,100 --> 00:14:53,900 You did it. Congratulations, you were 20 265 00:14:53,900 --> 00:14:56,600 years late, but at least you caught the guy and put him in 266 00:14:56,600 --> 00:14:59,100 prison for doing something horrifying. 267 00:14:59,200 --> 00:15:03,300 Meanwhile, if this, it just blows it boggles my mind and it 268 00:15:03,300 --> 00:15:06,100 makes You feel like all the people who criticize regulators 269 00:15:06,300 --> 00:15:09,200 and the government and all this stuff, I'm like, they're right 270 00:15:09,200 --> 00:15:11,100 there, fucking right, I can't argue with them. 271 00:15:11,300 --> 00:15:14,200 And we've talked about before that effectively allowing the 272 00:15:14,200 --> 00:15:17,700 bad behavior to continue allowing these Bad actors to go 273 00:15:17,700 --> 00:15:22,000 back out and do these things. Again, weakens the trust in 274 00:15:22,000 --> 00:15:24,900 these institutions, fix it. So in the future, they can't go 275 00:15:24,900 --> 00:15:26,900 after the bad guys, because everyone's like, oh, it's just 276 00:15:26,900 --> 00:15:29,500 the SEC, but are they going to do Gary Gensler? 277 00:15:29,500 --> 00:15:32,800 Talks a big game, he says, cryptos a problem, but he's the 278 00:15:32,800 --> 00:15:34,800 head of the SEC. See, and he's not actually doing 279 00:15:34,800 --> 00:15:36,500 anything. So he obviously doesn't actually 280 00:15:36,500 --> 00:15:40,300 believe cryptos a problem because if he did, he is the 281 00:15:40,300 --> 00:15:43,800 fucking regulator if he wanted to regulate, then he would 282 00:15:43,800 --> 00:15:46,200 regulate. So clearly he doesn't want to 283 00:15:46,200 --> 00:15:50,000 regulate, right is what people end up thinking and there's 284 00:15:50,000 --> 00:15:53,300 other things that contribute right, like organizational and 285 00:15:53,300 --> 00:15:55,700 institutional problems that make it harder for them to pursue 286 00:15:55,700 --> 00:15:58,100 these things. But also that's a fucking 287 00:15:58,100 --> 00:15:59,800 bullshit. Excuse like, we talked about 288 00:15:59,800 --> 00:16:02,700 this when Rohan gray was on to talk about e-cash, right? 289 00:16:02,800 --> 00:16:07,100 It is For bureaucrats to be good at their job, it is possible for 290 00:16:07,100 --> 00:16:10,700 government officials to try to do things and succeed. 291 00:16:11,300 --> 00:16:14,400 We've like set the bar so low in the expectations. 292 00:16:14,400 --> 00:16:17,100 So low, for the people who serve us that they get away with 293 00:16:17,100 --> 00:16:20,000 effectively doing nothing. And then immediately after their 294 00:16:20,000 --> 00:16:23,400 term is up, going into some high paying job, lobbying back to the 295 00:16:23,400 --> 00:16:26,300 same people that they helped set up inside these institutions. 296 00:16:26,800 --> 00:16:30,500 And so, yeah, you're right. It feels really disproportionate 297 00:16:30,600 --> 00:16:33,500 for Nate who made 19 ether from these trades. 298 00:16:33,600 --> 00:16:36,800 Has to be facing a 40-year sentence in prison, which he 299 00:16:36,800 --> 00:16:38,900 almost certainly won't get. It's not going to happen. 300 00:16:38,900 --> 00:16:42,700 We understand that but not stupid people, but it's still. 301 00:16:42,700 --> 00:16:45,500 So, it seems so shocked when we might be steamy us to. 302 00:16:45,500 --> 00:16:48,700 It seems so shocking. It seemed so shockingly, 303 00:16:48,700 --> 00:16:51,400 disproportionate compared to what we see, people get away 304 00:16:51,400 --> 00:16:53,300 with on a day-in and day-out basis that's it. 305 00:16:53,300 --> 00:16:56,100 Regardless of whatever things contribute to that, people's 306 00:16:56,100 --> 00:16:58,500 perception of that. Fundamentally makes our 307 00:16:58,500 --> 00:17:02,300 institutions worse fundamentally makes it harder for us to deal 308 00:17:02,300 --> 00:17:05,099 with real issues and that That's the fundamental problem of this 309 00:17:05,099 --> 00:17:09,000 kind of an action that loss of trust and faith eats away at the 310 00:17:09,000 --> 00:17:11,300 foundations of government and Regulation. 311 00:17:11,500 --> 00:17:14,900 And again, when instead of being able to give people a bunch of 312 00:17:14,900 --> 00:17:18,700 cases where I can go, I hear you but look at this example of them 313 00:17:18,700 --> 00:17:20,599 doing it right. Look at this example of them, 314 00:17:20,900 --> 00:17:23,000 getting the right company to do the right thing. 315 00:17:23,000 --> 00:17:24,800 You know, getting a company that was breaking the law. 316 00:17:24,800 --> 00:17:27,700 They shut that shit down. I can't tell you. 317 00:17:27,700 --> 00:17:31,900 The last time that happened it. I racked my brain and I cannot 318 00:17:31,900 --> 00:17:34,400 remember the last time a regulator You did the right 319 00:17:34,400 --> 00:17:37,200 thing and shut down a bad company. 320 00:17:37,200 --> 00:17:40,400 They don't do it. They don't do it. 321 00:17:40,700 --> 00:17:44,200 The 1930s when they first passed the Securities act and set up 322 00:17:44,200 --> 00:17:47,200 the commission may be right. That's Jim chanos said on the 323 00:17:47,200 --> 00:17:51,700 podcast the journalists, the public, the short sellers, these 324 00:17:51,700 --> 00:17:55,300 are the people who are doing the detective work, the regulator's. 325 00:17:55,300 --> 00:17:57,700 Don't give a fuck. They don't give a shit. 326 00:17:57,700 --> 00:18:01,100 They're doing all the like archiving which look archiving 327 00:18:01,100 --> 00:18:03,800 is necessary. It's important, we need to These 328 00:18:03,800 --> 00:18:06,400 stories after they've happened, you need to set precedence. 329 00:18:06,500 --> 00:18:09,100 You need to, you need to have that stuff. 330 00:18:09,200 --> 00:18:10,800 It's great. Like there's no reason 331 00:18:10,800 --> 00:18:13,200 Regulators need to suck. Regulators just suck because our 332 00:18:13,200 --> 00:18:16,200 politicians suck and our politicians suck because we've 333 00:18:16,200 --> 00:18:18,900 allowed these moneyed interest. Once you benefit from the lack 334 00:18:18,900 --> 00:18:21,900 of Regulation to basically co-opted and corrupt our 335 00:18:21,900 --> 00:18:24,400 politicians. So everyone thinks they can do 336 00:18:24,400 --> 00:18:27,000 whatever they want. Shortly after Nate's insider 337 00:18:27,000 --> 00:18:29,300 trading first came out back in 2021. 338 00:18:29,600 --> 00:18:33,000 There were people on crypto Twitter whose takeaway was well, 339 00:18:33,000 --> 00:18:35,700 the issue is That Nate didn't have enough equity in open. 340 00:18:35,700 --> 00:18:37,900 See if he had been making more from Open Sea. 341 00:18:37,900 --> 00:18:41,000 He wouldn't have needed The Insider trade and that's really 342 00:18:41,000 --> 00:18:45,400 just emblematic of some kind of deeper issue where like people 343 00:18:45,400 --> 00:18:48,900 are willing to sacrifice so much of their morality and ethics in 344 00:18:48,900 --> 00:18:52,300 exchange for funds. And I think that that has really 345 00:18:52,300 --> 00:18:56,200 pervaded, a lot of our society and has led to this corruption 346 00:18:56,200 --> 00:18:59,000 across so many levels. Yeah, you and I were talking the 347 00:18:59,000 --> 00:19:02,400 other day about like what could have possibly stop this from 348 00:19:02,500 --> 00:19:05,100 actually happening. Right, like I think think there 349 00:19:05,100 --> 00:19:09,300 is it's a good question. The solution for some reason 350 00:19:09,300 --> 00:19:14,300 being give the person more money feed, their greed doesn't seem 351 00:19:14,300 --> 00:19:18,100 to be the appropriate response to me, it's like, oh, you know 352 00:19:18,100 --> 00:19:20,600 if we gave the bank robber, a bunch of money, maybe they 353 00:19:20,600 --> 00:19:22,100 wouldn't be a bank robber anymore. 354 00:19:22,200 --> 00:19:24,300 Well yeah. I guess you're probably right. 355 00:19:24,400 --> 00:19:27,100 I don't know that. That's the solution. 356 00:19:27,400 --> 00:19:30,200 It's good to know that it was easy to follow. 357 00:19:30,300 --> 00:19:32,100 You know. It wasn't that hard to catch 358 00:19:32,100 --> 00:19:34,300 this guy doing this incredible? Only illegal thing. 359 00:19:34,300 --> 00:19:39,400 So I guess the blockchain is good for that though, the Luna 360 00:19:39,600 --> 00:19:42,800 and Terra collapse, all of the information coming out about 361 00:19:42,800 --> 00:19:46,900 that has been really murky and it doesn't seem like anyone has 362 00:19:46,900 --> 00:19:50,000 a full grasp of what the hell happened actually still. 363 00:19:50,200 --> 00:19:54,500 And we're talking weeks after the fact, I find that very, very 364 00:19:54,500 --> 00:19:58,600 odd that pushes me to go like, well, as much as everyone loves 365 00:19:58,600 --> 00:20:02,100 to pretend that the blockchain solves all transparency problems 366 00:20:02,100 --> 00:20:04,500 with Finance. Don't think it does. 367 00:20:04,500 --> 00:20:10,100 There is OTC stuff going on and the lfg was doing weird things. 368 00:20:10,800 --> 00:20:14,600 Do Quan was clearly up to some weird ass shit but nobody knows, 369 00:20:14,600 --> 00:20:17,800 nobody can tell you where identify what actually was going 370 00:20:17,800 --> 00:20:19,200 on in the blockchain doesn't help you. 371 00:20:19,200 --> 00:20:22,400 It's the same as like tether where where the reality is you 372 00:20:22,400 --> 00:20:25,300 can look at you can look at the Block Chain that tether the 373 00:20:25,300 --> 00:20:28,900 blockchains, the tether runs on and try to suggest that. 374 00:20:28,900 --> 00:20:31,500 That's well, I guess that's more transparency than the Federal 375 00:20:31,500 --> 00:20:33,900 Reserve. I mean I guess but like Unless 376 00:20:33,900 --> 00:20:37,100 we can see and access the bank accounts and all of their 377 00:20:37,100 --> 00:20:39,800 assets, we actually don't have a fucking clue. 378 00:20:39,800 --> 00:20:41,900 What is going on with tether right? 379 00:20:41,900 --> 00:20:45,100 Yeah and well sir just first things, the Federal Reserve is 380 00:20:45,100 --> 00:20:47,600 regularly audited. You people you can even go read 381 00:20:47,600 --> 00:20:50,700 their audits their online. You can adjust their there, 382 00:20:50,700 --> 00:20:52,800 they're easy to find. I guarantee you if you Google 383 00:20:52,800 --> 00:20:54,800 Federal Reserve audits, you can find them. 384 00:20:55,300 --> 00:20:59,400 My theory on terror and Luna is that the base is Cash. 385 00:20:59,400 --> 00:21:02,700 Team was attacking Tara to get back at do Quan for his rude 386 00:21:02,700 --> 00:21:08,600 comments about Is cash, but no actually like Manson Manson 387 00:21:08,600 --> 00:21:11,300 recently published their analysis of what happened during 388 00:21:11,300 --> 00:21:14,900 the Deep egging, right? And they kind of very subtly 389 00:21:14,900 --> 00:21:17,300 pointed finger, but they can't actually point the finger 390 00:21:17,300 --> 00:21:20,300 because it would get them in a bit of trouble publicly or no, 391 00:21:20,300 --> 00:21:22,500 sorry, jumping about jump, synopsis jump, and it is the 392 00:21:22,508 --> 00:21:23,900 finger. But they can't jump, has done an 393 00:21:23,900 --> 00:21:26,700 analysis, nonsense done, an analysis and Galaxy. 394 00:21:26,700 --> 00:21:30,000 I think also did an analysis, didn't they, the whole point to 395 00:21:30,000 --> 00:21:34,100 tfl withdrawing liquidity from curve as the First thing to 396 00:21:34,100 --> 00:21:38,400 start the de pegging the attackers coming for ya. 397 00:21:38,500 --> 00:21:41,600 And I think this was, this was something you and I said not to 398 00:21:41,600 --> 00:21:42,600 die. Know, we're getting a little off 399 00:21:42,600 --> 00:21:46,400 the nature as same thing. But this was something that I 400 00:21:46,600 --> 00:21:49,900 started getting suspicious of a little bit, like maybe a week 401 00:21:49,900 --> 00:21:52,200 after the Tara Luna stuff happened. 402 00:21:52,300 --> 00:21:56,500 It's a, it was a classic Trope back in 2017, 2018, where people 403 00:21:56,500 --> 00:22:01,300 would be like we got hacked and clearly, it did not mean that 404 00:22:01,300 --> 00:22:05,300 anybody got hacked. It was a Euphemism for we just 405 00:22:05,300 --> 00:22:08,900 took all your cash and something seemed off about the Tara Luna 406 00:22:08,900 --> 00:22:11,300 stuff to me, because nobody could fucking track it. 407 00:22:11,500 --> 00:22:14,100 And so, who knows like you said seemed, like, it came from 408 00:22:14,100 --> 00:22:17,200 inside the house that we don't know what that means. 409 00:22:17,300 --> 00:22:19,400 We don't know what that means. We don't know who that is my 410 00:22:19,400 --> 00:22:22,900 point, being, it's as murky as the normal Financial system. 411 00:22:23,100 --> 00:22:27,100 And the only people getting easily caught are the people who 412 00:22:27,100 --> 00:22:30,300 are doing a really bad job of covering their tracks. 413 00:22:30,500 --> 00:22:33,900 So if you have an OTC desk that you work in tight with with and 414 00:22:33,900 --> 00:22:36,400 you have a bunch of different wallets that you're using, and 415 00:22:36,400 --> 00:22:40,600 you use tornado cash and you constantly are throwing away 416 00:22:40,600 --> 00:22:43,700 certain wallets and your and you're peeling off, 417 00:22:43,700 --> 00:22:46,400 transactions, and you're doing everything perfectly. 418 00:22:46,600 --> 00:22:49,700 Maybe you can make it murky and especially if you if you're a 419 00:22:49,700 --> 00:22:54,500 giant firm, I think, again, our point being Nate's, getting the 420 00:22:54,500 --> 00:22:57,900 short end of the stick, he deserves to be in trouble, he's 421 00:22:57,900 --> 00:23:01,100 getting in way too much trouble. The people who should be 422 00:23:01,400 --> 00:23:06,900 prosecuted are Like do Quan and people like, I don't know, I'm 423 00:23:06,900 --> 00:23:09,700 not going to name any more names but certainly his name pops up 424 00:23:09,700 --> 00:23:11,600 because it's going to need to acquire. 425 00:23:11,600 --> 00:23:13,900 Yeah, because it's such a massive amount of money. 426 00:23:13,900 --> 00:23:17,400 And it just recently happened, I'd like to see more people like 427 00:23:17,400 --> 00:23:21,500 him or maybe like the coinbase thing, where we know a 428 00:23:21,500 --> 00:23:24,800 contractor help do wash trading. Well, maybe that contractor 429 00:23:24,800 --> 00:23:26,700 should get in serious serious trouble. 430 00:23:27,100 --> 00:23:28,300 I don't know. Just a thought. 431 00:23:28,400 --> 00:23:31,400 I think there's a lot of, a lot of companies doing really not 432 00:23:31,400 --> 00:23:34,800 good stuff for the customers, for the Retail public. 433 00:23:34,800 --> 00:23:38,700 They should get in a lot more trouble than some douchebag. 434 00:23:38,700 --> 00:23:41,000 It open see. He deserves he deserve to get in 435 00:23:41,000 --> 00:23:42,900 trouble. He certainly doesn't deserve Max 436 00:23:42,900 --> 00:23:45,700 sentencing. And I hate the way sentencing 437 00:23:45,700 --> 00:23:49,000 Works where they're clearly going to hover this over his 438 00:23:49,000 --> 00:23:52,200 head and be like, well, if you don't want 40 years in prison, 439 00:23:52,700 --> 00:23:56,200 you know, better plea and it's like, well, I guess that's 440 00:23:56,800 --> 00:23:58,900 horrible, though, that's so horrible. 441 00:23:59,400 --> 00:24:02,100 We want to believe everyone. In America is going to get a 442 00:24:02,100 --> 00:24:05,300 fair shot through our judicial System that everyone is going to 443 00:24:05,300 --> 00:24:08,500 get Mike a passionate and well-constructed defense. 444 00:24:08,500 --> 00:24:11,600 That will attempt to prove their innocence or give them the 445 00:24:11,600 --> 00:24:15,300 rights that they should be allotted. 446 00:24:15,300 --> 00:24:19,500 But our judicial system is cruel and capricious and many people 447 00:24:19,500 --> 00:24:22,500 are punished far beyond what is reasonable, right? 448 00:24:24,800 --> 00:24:29,500 That's probably going to do it for this episode if you or any 449 00:24:29,500 --> 00:24:33,200 of your friends, I've been told that our new monetization method 450 00:24:33,200 --> 00:24:36,600 for the crypto critics corner is going to be that. 451 00:24:36,900 --> 00:24:40,200 If you like And subscribe to the channel, we're going to go ahead 452 00:24:40,200 --> 00:24:44,000 and mint and nft for you. It's going to get listed on Open 453 00:24:44,000 --> 00:24:47,100 Sea on all these big platforms, but we are definitely going to 454 00:24:47,108 --> 00:24:49,800 meant more for ourselves and then sell them later obviously 455 00:24:49,800 --> 00:24:52,400 to fund the podcast. We're not doing it to harm 456 00:24:52,400 --> 00:24:54,200 investors there. No insider trading. 457 00:24:54,700 --> 00:24:58,600 Anyway, if you want to get a mint of crypto critics Corner, 458 00:24:58,600 --> 00:25:01,000 nft we're not actually making it. 459 00:25:01,000 --> 00:25:02,100 I'm sorry guys. I was lying.