1 00:00:05,100 --> 00:00:08,700 Welcome back everyone. I am Caspian Sea and I'm here as 2 00:00:08,700 --> 00:00:12,200 usual with my partner in crime. Mr. Bennett Tomlin how are you 3 00:00:12,200 --> 00:00:14,000 today? I'm doing pretty well Cass. 4 00:00:14,000 --> 00:00:15,500 How are you? I'm doing good. 5 00:00:15,500 --> 00:00:16,800 We're jumping around a little bit today. 6 00:00:16,800 --> 00:00:19,500 There's a lot going on, but I think we've decided that today 7 00:00:19,700 --> 00:00:23,600 it would be best if we talk about Solana and the Wormhole, 8 00:00:23,600 --> 00:00:27,100 bridge problem that happened this past week. 9 00:00:27,200 --> 00:00:29,900 So why don't you introduce everyone? 10 00:00:30,000 --> 00:00:31,800 E12 exactly what happened in case. 11 00:00:31,800 --> 00:00:34,900 They weren't paying attention to the hundreds of millions of 12 00:00:34,900 --> 00:00:37,900 dollars in aetherium that vanished. 13 00:00:38,000 --> 00:00:44,700 Yeah, first crypto is an absurd industry in which hundreds of 14 00:00:44,700 --> 00:00:47,700 millions of dollars can get hacked ranking is one of the 15 00:00:47,700 --> 00:00:51,200 like largest thefts of all time and people are just like, huh? 16 00:00:51,400 --> 00:00:56,500 Yeah, I guess that happened. Let's back up. 17 00:00:56,500 --> 00:01:03,100 A tri Wormhole is a cross. Chain intermediary, that allows 18 00:01:03,100 --> 00:01:07,200 people to move assets from one blockchain to another recently. 19 00:01:07,300 --> 00:01:11,500 Someone discovered a bug on the Solana, side of this, that 20 00:01:11,500 --> 00:01:16,600 allowed them to mint, 120,000 rapt ether. 21 00:01:17,100 --> 00:01:22,000 So these are ether on the Solana blockchain, the attacker, was 22 00:01:22,000 --> 00:01:26,600 that able to bridge 80,000 of those back to etherium, and 23 00:01:26,600 --> 00:01:29,800 withdraw, from Wormhole, gaining access to a teeth? 24 00:01:29,900 --> 00:01:35,300 Thousand etherium and using the other 40,000 to trade against 25 00:01:35,300 --> 00:01:38,700 various things on Solana. Yeah. 26 00:01:38,700 --> 00:01:41,500 So that's the heck that occurred shortly. 27 00:01:41,500 --> 00:01:44,600 A few etching several hours after this occurred, people on 28 00:01:44,600 --> 00:01:47,000 Twitter started to notice it happened. 29 00:01:47,900 --> 00:01:53,500 And then Sirtis or Sarita is the company behind Wormhole use 30 00:01:53,500 --> 00:01:55,900 their deployed. Post a message, telling the 31 00:01:55,900 --> 00:01:58,600 hacker that if they gave back the hundreds of millions of 32 00:01:58,600 --> 00:02:01,800 dollars worth of a theory, Them. Then they would give them ten 33 00:02:01,800 --> 00:02:04,800 million dollars. And how did that work out? 34 00:02:04,900 --> 00:02:07,000 Well, I don't think the hacker gave it back. 35 00:02:07,000 --> 00:02:13,100 My understanding is that jump crypto one of the larger Venture 36 00:02:13,100 --> 00:02:16,400 Capital firms in the crypto Arena which was spun off. 37 00:02:16,700 --> 00:02:19,700 Recently from jump. The major Commodities trading 38 00:02:19,700 --> 00:02:25,300 firm in Chicago decided instead to bail out certus and Wormhole 39 00:02:25,400 --> 00:02:31,400 because they had acquired it last August and they Have pretty 40 00:02:31,400 --> 00:02:34,800 incredible, exposure to the Solana, ecosystem as a whole. 41 00:02:35,100 --> 00:02:37,700 And we previously talked about jump crypto, I think, in the 42 00:02:37,700 --> 00:02:40,700 episode with David Kanellis, you can hear us talk about the 43 00:02:40,700 --> 00:02:43,700 tether papers. And in the tether papers jump is 44 00:02:43,700 --> 00:02:47,000 named as one of the major mentors of tethers. 45 00:02:47,300 --> 00:02:49,500 Yeah. At the time, they were 99% of 46 00:02:49,500 --> 00:02:52,400 all tethers on Solana or something like that, which it 47 00:02:52,400 --> 00:02:55,000 wouldn't surprise me. If that was still true, I 48 00:02:55,000 --> 00:02:57,600 haven't looked at how many tethers are on Solano these 49 00:02:57,600 --> 00:02:59,800 days, but I don't think it's gone up much. 50 00:03:00,000 --> 00:03:04,200 That report has come out and if it has jump would have the war 51 00:03:04,200 --> 00:03:07,400 chest to be the ones getting that much to Lana. 52 00:03:07,500 --> 00:03:11,300 That's a lot of money though. 360 million dollars in aetherium 53 00:03:11,300 --> 00:03:15,200 is just so much, so much money. It's an absurd amount of money. 54 00:03:15,200 --> 00:03:17,800 Yeah. And and so to make that decision 55 00:03:17,800 --> 00:03:21,400 to bail them out, almost instantly, I mean that that 56 00:03:21,400 --> 00:03:24,900 decision happened not within 24 hours, I think that happened 57 00:03:24,900 --> 00:03:28,500 within 12 hours of this hack. Something like that, something? 58 00:03:28,500 --> 00:03:32,100 Yeah, yeah, like with it. Half a day somehow jump had 59 00:03:32,100 --> 00:03:38,500 gotten together 120,000 etherium from somewhere, maybe from their 60 00:03:38,500 --> 00:03:41,000 own War chest. Maybe they're taking out major 61 00:03:41,000 --> 00:03:43,500 loans from other like, institutional, deaths, and 62 00:03:43,500 --> 00:03:48,400 over-the-counter trading desks and were able to replace the 63 00:03:48,400 --> 00:03:52,700 stolen aetherium in the protocol and in doing so helped. 64 00:03:52,700 --> 00:03:57,500 Prevent cascading liquidations across the salon and defy 65 00:03:57,500 --> 00:03:59,800 ecosystem, which really gets into why. 66 00:04:00,000 --> 00:04:02,800 They did it right because well, that's that was going to be my 67 00:04:02,800 --> 00:04:05,900 next question, which is like, so it had to be worth it for them 68 00:04:06,400 --> 00:04:09,700 to bail this out for such a massive amount of money. 69 00:04:10,300 --> 00:04:13,400 So quickly. This is, I mean, even for a 70 00:04:13,400 --> 00:04:18,000 major crypto currency, trading desk, 325 million dollars, worth 71 00:04:18,000 --> 00:04:22,600 of etherium is hard to come up with, at that quickly, or if it 72 00:04:22,600 --> 00:04:26,200 is easy to come up with, should still give you pause about 73 00:04:26,200 --> 00:04:29,300 spending it, but it doesn't seem like gave them much posit also. 74 00:04:29,900 --> 00:04:33,500 Why is this so important jump? Crypto is one of the largest 75 00:04:33,500 --> 00:04:36,900 liquidity providers in the Solana, ecosystem, like across 76 00:04:37,000 --> 00:04:41,000 serum, mango markets, their investors in pith networks. 77 00:04:41,000 --> 00:04:44,600 They obviously own searches, the Wormhole Bridge onto Solana and 78 00:04:44,600 --> 00:04:47,200 they have pretty incredible exposure to the Solana, 79 00:04:47,200 --> 00:04:50,800 ecosystem as a whole. And so my understanding of what 80 00:04:50,800 --> 00:04:56,600 likely occurred is that jump, crypto did the math and realized 81 00:04:56,600 --> 00:05:00,900 that three hundred million dollars was Than what they would 82 00:05:00,900 --> 00:05:07,600 lose letting the market react to all the rapt ether or that much 83 00:05:07,600 --> 00:05:10,900 rapt ether on Solana. Now, being unbanked they 84 00:05:10,900 --> 00:05:14,400 expected to get liquidated across the protocols or to lose 85 00:05:14,400 --> 00:05:18,200 too much in other things, they were exposed to and so filled 86 00:05:18,200 --> 00:05:21,200 the Gap and Protected Their investment and you bring up 87 00:05:21,200 --> 00:05:23,600 wrapped etherium. This is also, there's wrapped 88 00:05:23,600 --> 00:05:26,500 Bitcoin, there's wrapped. I mean, there's all kinds of 89 00:05:26,500 --> 00:05:29,700 wrapped tokens out there. In case anyone is wondering, 90 00:05:29,900 --> 00:05:32,900 Ying and they're unfamiliar with these Concepts, the ideas that 91 00:05:32,900 --> 00:05:35,700 you would. Let's say if you have a bunch of 92 00:05:35,700 --> 00:05:41,100 aetherium and you would prefer to trade, let's say you have one 93 00:05:41,100 --> 00:05:44,000 Bitcoin as well, you'd prefer to trade that one Bitcoin on 94 00:05:44,000 --> 00:05:48,300 aetherium, based markets as opposed to bitcoin against 95 00:05:48,300 --> 00:05:52,700 whatever you want to treat it as a wrapped Bitcoin on aetherium 96 00:05:52,700 --> 00:05:54,700 chain. What you would essentially do is 97 00:05:54,700 --> 00:05:58,800 take that one Bitcoin and more or less like steak it writes 98 00:05:58,800 --> 00:06:01,400 take it on this. Have to fear IAM protocol. 99 00:06:01,500 --> 00:06:05,800 Say like, Okay, so this one Bitcoin that I have is now 100 00:06:06,000 --> 00:06:08,900 substituted on this wrapped protocol. 101 00:06:08,900 --> 00:06:12,600 Is that right? Yeah, largely Bitcoins a little 102 00:06:12,600 --> 00:06:14,600 bit different. Any of these cross chain things 103 00:06:14,600 --> 00:06:16,700 get a little bit different because each chain is different. 104 00:06:16,700 --> 00:06:20,500 So wrapped Bitcoin you deposit to a certain Bitcoin address and 105 00:06:20,500 --> 00:06:24,000 then get to a certain etherium address your wrapped Bitcoin 106 00:06:24,000 --> 00:06:26,000 right? For this one, you deposit, your 107 00:06:26,000 --> 00:06:29,700 etherium in searches one Bridge, you get the rap. 108 00:06:29,800 --> 00:06:32,200 D through which can then go over to Solana. 109 00:06:32,700 --> 00:06:36,700 And so you're depositing your token in these smart contracts 110 00:06:36,700 --> 00:06:40,000 and that's really what the bug that happened here was is there 111 00:06:40,000 --> 00:06:44,800 was a smart contract bug on the salon aside that enabled 112 00:06:44,800 --> 00:06:48,500 additional minting of The rapt. Ether token that results from 113 00:06:48,500 --> 00:06:51,200 that bridge and what you're suggesting is that there's all 114 00:06:51,200 --> 00:06:55,000 these trades happening with these wrapped tokens and that 115 00:06:55,300 --> 00:06:58,400 the well and not just traits. Okay. 116 00:06:58,700 --> 00:07:01,700 More importantly it Abused his collateral, right? 117 00:07:01,800 --> 00:07:04,200 In all these different lending. Protocols are the various defy 118 00:07:04,200 --> 00:07:06,600 protocols like think about like maker that right? 119 00:07:06,600 --> 00:07:09,000 Foundationally, it's a lending protocol, you're putting up 120 00:07:09,000 --> 00:07:12,500 collateral and getting a loan denominated in die, right? 121 00:07:12,600 --> 00:07:16,400 And this idea expands much Beyond maker in the defy 122 00:07:16,400 --> 00:07:19,600 ecosystem, Abracadabra. The one we talked about that 123 00:07:19,600 --> 00:07:23,100 involved. Sifu and petrine is same, basic 124 00:07:23,100 --> 00:07:28,700 idea as maker do but instead the collateral was, why aren't you 125 00:07:28,700 --> 00:07:30,800 sdt rather? Than ether. 126 00:07:31,100 --> 00:07:33,500 And so there's a whole bunch of protocols over on Solana that 127 00:07:33,500 --> 00:07:36,000 were using rapt ether as collateral. 128 00:07:36,100 --> 00:07:39,800 And that the value of that rapt ether suddenly effectively 129 00:07:39,800 --> 00:07:42,600 plummeted because it was no longer backed by the expected 130 00:07:42,600 --> 00:07:46,000 amount of ether, on the etherium side of the contract. 131 00:07:46,100 --> 00:07:50,400 And so, it was, it's kind of like a stable quindi Peg. 132 00:07:50,400 --> 00:07:53,800 When one of these wrapped assets gets hacked like this, the 133 00:07:53,800 --> 00:07:55,700 market didn't really react that way, though. 134 00:07:55,700 --> 00:07:58,300 If I'm recalling correctly, like, people were a little bit 135 00:07:58,300 --> 00:08:02,100 concerned that this That there might be some issues with these 136 00:08:02,100 --> 00:08:06,100 wrapped etherium, but then it's almost like the market knew that 137 00:08:06,100 --> 00:08:09,300 jump was going to come in and just fully back this thing. 138 00:08:09,600 --> 00:08:13,700 Yes, this, this was strange watching from the sidelines for 139 00:08:13,700 --> 00:08:17,500 this and maybe there was more stuff for people deep in the 140 00:08:17,500 --> 00:08:20,600 Solana, ecosystem, that I missed just because where I was sitting 141 00:08:20,600 --> 00:08:23,200 on Twitter, but from what I could tell, it took several 142 00:08:23,200 --> 00:08:25,900 hours for people to even realize the hack occurred. 143 00:08:25,900 --> 00:08:28,300 Then afterwards, you're right rap, either only traded at a 144 00:08:28,300 --> 00:08:32,600 very slight discount. And so my assumption there is 145 00:08:32,600 --> 00:08:35,500 even if the market did not necessarily expect jump crypto 146 00:08:35,500 --> 00:08:40,900 to step in that jump itself had decided it was worthwhile to 147 00:08:40,900 --> 00:08:45,000 maintain the value of rapt ether until a decision was made or 148 00:08:45,000 --> 00:08:46,900 whatever. And so if they're the major 149 00:08:46,900 --> 00:08:49,900 liquidity provider, there's major major Market maker with 150 00:08:49,900 --> 00:08:53,900 tons of cash on hand for them. Providing the liquidity at the 151 00:08:53,900 --> 00:08:57,700 certain price point can be maintained for period while they 152 00:08:57,700 --> 00:08:59,700 decide what they want to do. And so that's what I think was 153 00:08:59,700 --> 00:09:01,100 happening. Opening in those hours. 154 00:09:01,100 --> 00:09:04,700 Immediately after the heck, jump kept trading, rapt ether has if 155 00:09:04,700 --> 00:09:07,100 it was fully backed and meanwhile, they were in 156 00:09:07,100 --> 00:09:11,000 Communications internally and with their company certus, one 157 00:09:11,200 --> 00:09:13,600 to decide, what was the best course of action? 158 00:09:13,800 --> 00:09:16,800 This brings us to another interesting point which is that 159 00:09:16,800 --> 00:09:21,600 aetherium, I guess co-founder vitalik butyrin recently did a 160 00:09:21,608 --> 00:09:25,700 post like a week before this all happened where he was suggesting 161 00:09:25,700 --> 00:09:29,700 that cross chain stuff Bridges. These bridges for moving. 162 00:09:29,800 --> 00:09:33,100 Buying assets between cryptocurrencies, is not the 163 00:09:33,100 --> 00:09:37,800 future and that this would open the ecosystem up to issues these 164 00:09:37,800 --> 00:09:41,000 Bridges would present. So many new problems that 165 00:09:41,000 --> 00:09:44,500 there's no way they could be reliably secure. 166 00:09:44,700 --> 00:09:48,800 So weird timing, not, not suggesting not suggesting 167 00:09:48,800 --> 00:09:50,400 anything nefarious. I think everyone's just kind of 168 00:09:50,400 --> 00:09:55,600 like, wow, that is intense. And there is a big, obviously, a 169 00:09:55,608 --> 00:09:59,300 big swath of the community whether it's jump. 170 00:09:59,900 --> 00:10:04,400 Or other, you know, big names in cryptocurrency that believe 171 00:10:04,400 --> 00:10:08,700 cross chain is the future of cryptocurrency of decentralized 172 00:10:08,700 --> 00:10:10,800 Finance. Can we talk about? 173 00:10:10,800 --> 00:10:12,900 Why people think it is the future? 174 00:10:13,000 --> 00:10:17,500 But also why there are all these new security issues that just 175 00:10:17,500 --> 00:10:21,400 present so many problems. Sure it was quite interesting 176 00:10:21,400 --> 00:10:24,400 timing from metallic. What's interesting about this 177 00:10:24,400 --> 00:10:27,800 though is that this was not a bridge specific hack, right? 178 00:10:27,800 --> 00:10:31,100 Like this was a smart contract, but Buck and it's the type of 179 00:10:31,100 --> 00:10:35,500 smart contract bug that a variety of smart contract could 180 00:10:35,500 --> 00:10:37,800 have. And so this specific example, 181 00:10:37,800 --> 00:10:42,400 really speaks more to the difficulties in producing. 182 00:10:42,500 --> 00:10:45,000 Immutable censorship resistant coat, right. 183 00:10:45,000 --> 00:10:47,500 Designing software. It is very common for there to 184 00:10:47,500 --> 00:10:51,900 be bucks, but in defy, and in crypto, as a whole, the cost for 185 00:10:51,900 --> 00:10:55,100 any bug, whatsoever, is extraordinarily High. 186 00:10:55,200 --> 00:10:57,500 I think metallic was getting at, that does apply here. 187 00:10:57,800 --> 00:11:00,800 Is that any time? You're trying to Trucked across 188 00:11:00,800 --> 00:11:04,500 different chains with different security assumptions, different 189 00:11:04,600 --> 00:11:08,000 differences at all. You are vastly increasing the 190 00:11:08,000 --> 00:11:11,000 complexity of your application, no matter how simple, the thing 191 00:11:11,000 --> 00:11:13,000 you're trying to do a cross chain, is doing it on two 192 00:11:13,000 --> 00:11:17,300 chains, instead of one is likely to make your code in order of 193 00:11:17,300 --> 00:11:20,500 magnitude more complex. And so, well, this was a smart 194 00:11:20,500 --> 00:11:23,900 contract bug, which could have occurred in non Bridge things. 195 00:11:23,900 --> 00:11:27,100 It's also true that the very process of Designing a bridge is 196 00:11:27,100 --> 00:11:31,100 a process that like, designing, any Any complex piece of 197 00:11:31,100 --> 00:11:33,700 software. It is extraordinarily difficult 198 00:11:33,700 --> 00:11:37,500 to do without bugs. Now, you asked another question 199 00:11:37,500 --> 00:11:40,300 that which is why or some of these people in crypto. 200 00:11:40,300 --> 00:11:45,200 So interested in this multi chain cross in this cross chain 201 00:11:45,200 --> 00:11:48,500 future, right? And I'm not sure why. 202 00:11:49,000 --> 00:11:52,300 Because my initial instinct is that one of the we talked about 203 00:11:52,300 --> 00:11:54,200 this a little bit with Oliver when he was on here. 204 00:11:54,300 --> 00:11:57,100 One of the driving things for cryptocurrency adoption is the 205 00:11:57,100 --> 00:11:59,400 network effect. You get more liquidity and one 206 00:11:59,400 --> 00:12:01,200 chain. More activity on one chain and 207 00:12:01,200 --> 00:12:04,400 it helps bring more liquidity and activity out of that chain 208 00:12:04,400 --> 00:12:10,200 fracturing, that cross chain, seems less advantageous. 209 00:12:10,400 --> 00:12:13,900 However, there are differences between the chains, right? 210 00:12:13,900 --> 00:12:17,700 It's a lot cheaper to transact on Solana than aetherium and so 211 00:12:18,300 --> 00:12:21,800 it might just be that there's search and trading activities 212 00:12:22,000 --> 00:12:27,600 which are easier to do on the decentralized exchange is like 213 00:12:27,600 --> 00:12:31,100 serum or mango markets instead. Of something like Yuna Swap. 214 00:12:31,700 --> 00:12:35,700 And so by wrapping and bridging it over, these firms are able to 215 00:12:35,700 --> 00:12:38,500 better execute their tactics or it could just be in. 216 00:12:38,508 --> 00:12:42,600 This would be the more VC like claim that not every application 217 00:12:42,600 --> 00:12:45,500 requires the same set of security assumptions. 218 00:12:45,600 --> 00:12:50,100 And so for certain applications that do not require a certain 219 00:12:50,100 --> 00:12:52,800 level of decentralization censorship resistance or 220 00:12:52,800 --> 00:12:57,000 security, it may be cheaper to bridge the valuable asset from 221 00:12:57,000 --> 00:13:00,900 that chain over to another chain and do the Reactions with it, in 222 00:13:00,900 --> 00:13:04,700 the less secure, but cheaper place, I find most of the Cross 223 00:13:04,700 --> 00:13:08,500 chain arguments, pretty unconvincing, but I'm pretty 224 00:13:08,500 --> 00:13:11,000 skeptical. Just in general. 225 00:13:11,900 --> 00:13:16,300 It does seem like a lot of it is Venture capitalists and hedge 226 00:13:16,300 --> 00:13:20,900 funds that are very keen on this, that usually means that 227 00:13:20,900 --> 00:13:24,000 there's a cost basis for their interest. 228 00:13:24,000 --> 00:13:28,700 Clearly the cost basis for jump crypto is far greater than 325 229 00:13:28,700 --> 00:13:32,500 million dollars. To support this cross Chain 230 00:13:32,700 --> 00:13:35,600 Bridge. It's also so funny to me because 231 00:13:35,800 --> 00:13:40,100 we had Daniel Goldman on who works on arbitrary mm-uh is a 232 00:13:40,108 --> 00:13:44,400 layer 2 solution for transactions on etherium. 233 00:13:44,900 --> 00:13:47,600 I have my own skeptical issues with layer choose in general, 234 00:13:47,600 --> 00:13:52,000 which is that your there's so many steps involved already. 235 00:13:52,200 --> 00:13:56,600 Once you've gotten to layer to that, hoping most people will be 236 00:13:56,600 --> 00:14:01,300 able to understand it at all is a Big ask, but I'm sure people 237 00:14:01,300 --> 00:14:03,100 said that about the internet to, right? 238 00:14:03,100 --> 00:14:05,800 I'm sure there's comparisons. People could make that would be 239 00:14:05,800 --> 00:14:10,400 apt and fair, but it's so funny that there's these cross Chain 240 00:14:10,500 --> 00:14:15,600 Solutions that are being sponsored essentially by giant 241 00:14:15,600 --> 00:14:20,000 trading firms and Venture capitalists, and then there's 242 00:14:20,400 --> 00:14:25,100 arbitrament and, and lightning, which are also supported by VC 243 00:14:25,100 --> 00:14:29,300 funds and stuff, but don't seem to get the same kind of 244 00:14:29,300 --> 00:14:30,600 attention. One or traction. 245 00:14:30,700 --> 00:14:32,500 It doesn't. I don't know if it's just like 246 00:14:32,600 --> 00:14:36,400 the ability to monetize them or I don't know why, I don't know 247 00:14:36,400 --> 00:14:40,200 why these are less focused on or if if they've failed. 248 00:14:40,200 --> 00:14:43,400 Like I think lightning is generally considered a failure 249 00:14:43,500 --> 00:14:46,000 of a network at this point, but I guess that'll be up for 250 00:14:46,000 --> 00:14:47,400 debate. And people will probably tell me 251 00:14:47,400 --> 00:14:49,500 how wrong I am. I guess it's being used in El 252 00:14:49,500 --> 00:14:51,100 Salvador, right? I don't know. 253 00:14:51,900 --> 00:14:57,700 I can tell you why, because VCS got into Solana early at a 254 00:14:57,708 --> 00:15:01,200 really cheap price, and To benefit from the price 255 00:15:01,200 --> 00:15:05,500 appreciation of Salon itself. Arbitrament has Daniel made 256 00:15:05,500 --> 00:15:07,600 clear? When yours on our podcast does 257 00:15:07,600 --> 00:15:11,900 not have a token and so yeah peace he's invested in the 258 00:15:11,900 --> 00:15:14,700 company behind it and have Equity stakes in that company. 259 00:15:15,000 --> 00:15:20,700 But that's somewhat harder to get exit liquidity on and it is 260 00:15:20,800 --> 00:15:25,300 less clear that value Arbitron as a protocol derives will 261 00:15:25,300 --> 00:15:30,300 accumulate to that company. And so in this speaks to One of 262 00:15:30,300 --> 00:15:35,100 the troubling things for me about Solana is that so much of 263 00:15:35,100 --> 00:15:38,600 the ecosystem. Seems deeply centralized. 264 00:15:38,600 --> 00:15:42,700 And we've seen this, when the validators have had issues, and 265 00:15:42,700 --> 00:15:46,500 we've had to watch them coordinate to try to figure out 266 00:15:46,500 --> 00:15:50,400 how to reboot the network. We've seen this with the huge 267 00:15:50,400 --> 00:15:53,500 amounts of VC money, which got funneled into Solana and how 268 00:15:53,500 --> 00:15:56,800 much they control. We see evidence in it in the 269 00:15:56,800 --> 00:15:59,600 fact that jump crypto is willing to blow. 270 00:15:59,700 --> 00:16:02,700 Your million dollars to help protect the value of it because 271 00:16:02,700 --> 00:16:05,800 they get nervous. And we saw it when the tether 272 00:16:05,800 --> 00:16:08,800 papers came out and we saw that jump was responsible for 273 00:16:08,808 --> 00:16:11,800 basically all the tether on Solana. 274 00:16:11,800 --> 00:16:15,600 There is still a lot of protocols in crypto and defy 275 00:16:15,800 --> 00:16:20,100 that claim decentralization. But have these huge vectors of 276 00:16:20,100 --> 00:16:24,100 centralization inherent in them, which we've discussed this. 277 00:16:24,200 --> 00:16:26,900 Also, I feel like we've discussed the idea that like, 278 00:16:26,900 --> 00:16:30,600 you know, for some solutions centralization, just Makes sense 279 00:16:30,600 --> 00:16:33,800 and that's not an issue. But then why bother having a 280 00:16:33,800 --> 00:16:38,500 blockchain with seven validators or what like why bother why 281 00:16:38,500 --> 00:16:41,100 bother pretend playing pretend anymore at that point? 282 00:16:41,100 --> 00:16:45,000 It just seems like so so strange to me and I guess that goes to 283 00:16:45,000 --> 00:16:48,500 the idea that these there's these buzzwords, there's 284 00:16:48,500 --> 00:16:53,800 decentralization and blockchain, cryptocurrency token. 285 00:16:53,800 --> 00:16:57,500 There's rich people who profit when the price goes up. 286 00:16:58,100 --> 00:17:00,400 Yeah. But but getting It's getting 287 00:17:00,400 --> 00:17:03,500 those rich people involved in your project to begin with 288 00:17:03,600 --> 00:17:08,400 requires you to utilize these Buzz words in general, right? 289 00:17:08,400 --> 00:17:10,900 Like we see that with when we talked about bit Cloud which is 290 00:17:10,900 --> 00:17:16,099 now D, so decentralized, social media, so stupid but we have 291 00:17:16,099 --> 00:17:19,700 seen this time and time again where they Fain decentralization 292 00:17:19,700 --> 00:17:23,599 and Fain. All these hip crypto words. 293 00:17:23,800 --> 00:17:25,400 When in reality it's just a giant cash. 294 00:17:25,400 --> 00:17:27,900 Grab, I know you and I have friends who are like, very 295 00:17:27,900 --> 00:17:29,500 bullish on Solana still, I think. 296 00:17:29,600 --> 00:17:33,200 Think I wouldn't doubt that the VCS could fund that thing to the 297 00:17:33,200 --> 00:17:35,000 Moon. They probably can. 298 00:17:35,000 --> 00:17:39,500 I it's not it's not our project. So I just I can see I could see 299 00:17:39,500 --> 00:17:43,100 them just going as hard as they have to to make it work. 300 00:17:43,100 --> 00:17:46,100 And that that's fine. It just it just sucks. 301 00:17:46,100 --> 00:17:49,200 That that money doesn't go to maybe some more interesting 302 00:17:49,200 --> 00:17:53,700 projects that could benefit more people which I think may exist 303 00:17:53,700 --> 00:17:56,800 in the space somewhere. I certainly think there's more 304 00:17:56,800 --> 00:18:00,500 interesting projects out there perhaps the more Troubling 305 00:18:00,600 --> 00:18:06,000 implication to me is that if these major firms like jump, who 306 00:18:06,000 --> 00:18:09,300 have such massive exposure to Solana that they will, 307 00:18:09,300 --> 00:18:13,100 immediately deploy, a third of a billion dollars to protect it. 308 00:18:13,100 --> 00:18:19,800 That's potentially pretty massive war chest for lobbying, 309 00:18:19,800 --> 00:18:26,700 for political donations. And for efforts to ensure that 310 00:18:26,900 --> 00:18:29,800 these firms that have benefited from the growth of these, Calls 311 00:18:29,800 --> 00:18:32,800 can continue to benefit. I don't think anyone's doubting 312 00:18:32,800 --> 00:18:35,600 that there's a giant push right now from the cryptocurrency 313 00:18:35,600 --> 00:18:38,400 industry to Lobby the hell out of US. 314 00:18:38,400 --> 00:18:42,000 Congress and proposed the idea that if we don't just let all 315 00:18:42,000 --> 00:18:45,900 this stuff happen we're going to get left behind which fine but 316 00:18:45,900 --> 00:18:51,100 oil industry also does that and a lot of horrible Industries do 317 00:18:51,100 --> 00:18:56,100 equally terrible things and get Congress to back them so that's 318 00:18:56,100 --> 00:18:58,800 fine. You know whatever we've talked 319 00:18:58,800 --> 00:19:02,200 about a lot of Things that I don't have any issue with when 320 00:19:02,200 --> 00:19:04,600 it comes to crypto. It doesn't bother me that it's 321 00:19:04,600 --> 00:19:06,300 gambling. It doesn't bother me that. 322 00:19:06,300 --> 00:19:08,200 It's speculation. It doesn't a lot of this. 323 00:19:08,200 --> 00:19:11,100 I don't take issue with it all. And I really don't take issue 324 00:19:11,100 --> 00:19:13,900 with people wanting to gamble and wanting to speculate all of 325 00:19:13,908 --> 00:19:17,200 that's fine. It Harkens back to that episode. 326 00:19:17,200 --> 00:19:22,100 We did with David the tether papers where even if you feel 327 00:19:22,100 --> 00:19:25,200 like the information gleaned from the tether papers is just 328 00:19:25,200 --> 00:19:28,000 so basic or something. I think the important takeaway 329 00:19:28,000 --> 00:19:29,400 becomes like look at whose trade. 330 00:19:29,600 --> 00:19:31,900 Young against you and they are trading against you. 331 00:19:32,000 --> 00:19:36,800 This is Jump backing this protocol at this rate because 332 00:19:36,800 --> 00:19:38,600 they think it's more. It's going to save them more 333 00:19:38,600 --> 00:19:41,900 money to do that than, if they let the market actually react 334 00:19:41,900 --> 00:19:45,400 normally to it. And that means they're trading 335 00:19:45,400 --> 00:19:48,500 against against retail, their trading against retail. 336 00:19:48,500 --> 00:19:49,700 That's who they're trading against. 337 00:19:49,900 --> 00:19:52,400 That's who all of these people are trading against their in it. 338 00:19:52,400 --> 00:19:55,800 So you lose and if you know that going in, if you know that 339 00:19:55,800 --> 00:19:58,900 you're you're playing against the casino and you're probably 340 00:19:58,900 --> 00:20:03,100 going to lose. I think it's a much safer bet 341 00:20:03,100 --> 00:20:05,900 for everybody involved. Yeah, exactly. 342 00:20:06,000 --> 00:20:10,600 These firms are not your friend. The goal of all of these firms 343 00:20:10,700 --> 00:20:17,800 Cumberland Alameda, three arrows Capital, jump, they exist to 344 00:20:17,800 --> 00:20:20,700 make money. And the way they make money in 345 00:20:20,700 --> 00:20:24,000 zero-sum environments is by someone else losing it and they 346 00:20:24,000 --> 00:20:27,300 hope your that someone not you in particular but you is like a 347 00:20:27,300 --> 00:20:29,400 category. Yeah, not them. 348 00:20:30,300 --> 00:20:34,000 Hopefully that explains this to the best degree that we can. 349 00:20:34,100 --> 00:20:37,800 I think everyone should just be aware, you know that these guys 350 00:20:37,800 --> 00:20:43,400 have very, very obvious intentions and helping you is 351 00:20:43,400 --> 00:20:45,200 not one of them. We're going to see how this 352 00:20:45,200 --> 00:20:46,900 plays out. We're going to see what happens 353 00:20:46,900 --> 00:20:48,800 with Wormhole. This isn't going to be decided 354 00:20:48,800 --> 00:20:51,600 this week or next week or in a month, even probably like, this 355 00:20:51,600 --> 00:20:54,800 is something that will play out over, who knows even years. 356 00:20:55,500 --> 00:20:59,100 And maybe maybe these people who believe in Cross chain Bridges 357 00:20:59,100 --> 00:21:01,700 or Maybe they are right, you never know. 358 00:21:02,000 --> 00:21:07,200 But I'll tell you the the past few weeks with this magic 359 00:21:07,200 --> 00:21:11,600 internet money stuff. And this Wormhole thing it feels 360 00:21:11,600 --> 00:21:14,900 like for the first time in a while it's not even Regulators 361 00:21:14,900 --> 00:21:18,300 or congress coming after the cryptocurrency space, it's just 362 00:21:18,900 --> 00:21:21,200 the cryptocurrency space. It's like that Meme where the 363 00:21:21,200 --> 00:21:24,300 guy is riding the bicycle and then he takes a stick and just 364 00:21:24,300 --> 00:21:27,400 shoves it in his front wheel. That's what I think is happening 365 00:21:27,400 --> 00:21:30,500 in decentralized finance and See right now, and then they're 366 00:21:30,500 --> 00:21:33,700 like, falling on the floor bleeding in there, like damn you 367 00:21:33,700 --> 00:21:37,400 government. And you're like, man, yeah, the 368 00:21:37,400 --> 00:21:41,000 government is the one who introduced you to invest in the 369 00:21:41,000 --> 00:21:43,800 protocol called Magic internet money. 370 00:21:43,900 --> 00:21:47,200 Yeah. But yeah, so that's gonna do it 371 00:21:47,200 --> 00:21:50,800 for us this week. We have some really fun news 372 00:21:50,800 --> 00:21:54,600 coming out next week and I'm, I'm getting amped and excited. 373 00:21:54,600 --> 00:21:58,500 I can't, I can't share more than that, but I know for a fact that 374 00:21:58,500 --> 00:22:02,200 next week, we have some big news coming out and I'm very, very 375 00:22:02,200 --> 00:22:04,500 excited for it. And I look forward to sharing it 376 00:22:04,500 --> 00:22:06,900 with you guys soon. Stay tuned. 377 00:22:08,000 --> 00:22:11,100 If you enjoyed this episode we would really appreciate it. 378 00:22:11,100 --> 00:22:14,300 If you shared it with a friend you thought could enjoy it or 379 00:22:14,300 --> 00:22:17,300 left a rating and review. Both of those things are the 380 00:22:17,300 --> 00:22:20,600 things that help us grow this podcast and we truly appreciate 381 00:22:20,600 --> 00:22:22,100 your support. Thank you.