The Breakdown

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Why DeFi Is Surging As The Market Pumps Jan 15, 2020

Show notes

Crypto tokens weren’t the only thing that saw a major pump yesterday. The total value locked in DeFi ascended to new heights. While part of this can be explained simply by the rise in ETH price, it also reflected traders turning to DeFi platforms as a way to get more exposure to the market action without selling their core assets.

For all the exciting price action, not everything is pointing in a positive direction. These market moves don’t seem to reflect new market participants, for example, and anecdotally, times remain tough for projects trying to fundraise.

In our final segment, we look at a blockchain conference in North Korea that the UN suggests simply attending may violate international sanctions, an Iran-focused hedge fund that uses cryptocurrency to work around international restrictions, and ask whether this sort of activity presents a narrative risk to the industry as a whole?

Mati Greenspan on the Technical and Macro Roots of Bitcoin’s Price Surge Jan 14, 2020

Show notes

Bitcoin is up more than 8% in the last 24 hours. BSV, meanwhile, is up nearly a whopping 100%. The question is, of course, why? Is it some larger macro context? A pump-and-dump? Or just the crypto markets being as crazy as they are. The Breakdown invited guest Mati Greenspan, former e-Toro analyst and now founder of Quantum Economics to give his take.

We also look at two stories around the growing crypto derivative markets: the launch of the CME’s options on bitcoin futures and CFTC Chair Heath Tarbert’s comments yesterday that regulated derivatives will bring legitimacy to the space. Finally, we look at a just-released Investor Alert from the SEC on IEOs.

Tokenized NBA Contracts & The Hunt For Crypto’s Killer App Jan 13, 2020

Show notes

Starting today, accredited investors will be able to part of $13.5m in tokenized bonds connected to the contract of Brooklyn Nets Point Guard Spencer Dinwiddie. The first-of-its-kind offering took months of negotiation with the NBA but marks a seminal moment for both crypto and the larger idea of Income Share Agreements.

In this podcast, we discuss how big a deal Dinwiddie’s offering is and whether Income Share Agreements could be a breakout use case for crypto. We also discuss other contenders for “crypto killer app,” including undercollateralized DeFi loans and NFT-based games. Finally, we discuss whether crypto’s actual killer app has already arrived - in the form of using bitcoin to escape local political and economic controls.

The Breakdown Weekly Recap | Jan 11 2020 Jan 11, 2020

Show notes

All 5 episodes of The Breakdown in one long file. By popular demand, this is an experiment to see if it's useful to have the full week's episodes compiled in a single file. I've also summed up what I think is most important about the week. Let me know if you like this format or if you just find it repetitive @nlw on Twitter.

China Completes "Top-Level" Digital Currency Design Jan 10, 2020

Show notes

China’s digital currency project continues to move ahead aggressively, with a new paper from the People’s Bank of China suggesting that a core design is complete. Whatever stage of development the currency actually is, it’s clear that China wants the world to see it as ahead of the curve in the digital currency race.

In other parts of the world, crypto companies face a never-ending game of regulatory arbitrage. Derebit has moved from the Netherlands to Panama, citing a new burden from AMLD5 compliance. In the U.S., New York wants to give its crypto regulators (even) more teeth while Illinois recognizes the legality of blockchain-based contracts.

Why 2020 Is The Year Of DAOs feat Aragon's Luis Cuende Jan 09, 2020

Show notes

The aftershock of the 2016 The DAO hack meant that DAOs weren’t nearly as hyped as ICOs and later some other aspects of the web3 movement. In 2019, however, DAOs came roaring back and start 2020 with the wind at their sails.

In this episode, we look at the 2019 DAO tale of the tape - what people thought would happen and what actually did happen, including the launch of Moloch, MetaCartel, Ethereum’s MarketingDAO and more than 1000 DAOs on Aragon. We also hear from Aragon founder Luis Cuende who discusses 1) why the newly launched Aragon courts expand what DAOs can do; 2) examples of the need for subjective human intervention in DAOs; and 3) why 2020 is poised to be DAOs best year yet.

Travis Kling on the BTC Bump and Safe Haven Status Jan 08, 2020

Show notes

The conversation about whether bitcoin is a safe haven asset continues in the wake of Iranian missile strikes, which saw the price of BTC both surge and retrace in parallel with crude and gold. To help explain what’s going on, we feature comments from Ikigai Asset Management’s Travis Kling.

Also in today’s episode, we look at newly published priorities from the SEC around crypto including investor suitability, trading practices, and compliance program effectiveness. We also discuss former Bakkt CEO and now Georgia Senator Kelly Loeffler’s appointment to the committee that oversees the CFTC. Is it a conflict of interest, something good for the crypto industry, or both?

How Compliance Costs Could Kill Crypto Innovation Jan 07, 2020

Show notes

In their annual transparency report, Kraken reported seeing a 50% increase in regulatory inquiries as compared to 2018, which CEO Jesse Powell later revealed cost the exchange more than $1m. Between this and stories like the $2m it cost Blockstack to raise $23m in an SEC compliant token sale (8.7% of the raise), it begs the question: will compliance costs fundamentally limit innovation by demanding big war chests to play? Will the most successful companies be those who (like Block One) simply raise enough to pay off the regulators on the back end?

We also look at new mining interests in Texas and what it means for Amiercan mining and bitcoin mining in the lead up to the halving more broadly, as well as dissect an op-ed from the IMF’s chief economist on the strength of the dollar over digital alternatives.

What Iran and Instability Mean For Bitcoin Jan 06, 2020

Show notes

Last week, the US government took out a key Iranian military leader. As the world - and the markets - reacts to the news, some are asking what happens with bitcoin. With global instability on the rise, will more people turn to bitcoin as a safe haven asset? Will speculators drive the price up on that narrative even if it doesn’t bear out in reality? If Iranians use crypto, will that draw the attention and ire of regulators?

In a different area of the industry, Telegram has released updated information about their forthcoming crypto token TON. Most notable was the bombshell that the token would not be integrated into Telegram Messenger - which was, of course, the predominant logic behind the more than $1.7B that was invested in the TON presale.

Finally, we discuss the dust up around Nakamoto.com, a new crypto journal that was almost immediately accused of affinity scamming and censorship. Is it a case of overzealous bitcoin defenders or does the critique hold merit?

YouTube, Tron and the Pipedream of Decentralized Social Networks Jan 03, 2020

Show notes

The past few weeks have seen multiple instances of large, centralized tech giants censoring crypto related content and activity. Noticed in the context of the Coinbase Wallet, Apple is pushing back against apps that have anything to do with Dapps. YouTube caused even more of a stir when it took down hundreds of crypto-related videos from prominent influencers without any warning. It later reversed the action, claiming an error, but it was enough to get many to ask: are decentralized alternatives possible?

As if on cue, Justin Sun popped up to announce that TRON had struck a deal through which decentralized Twitch competitor and streaming service DLive would be moving to the TRON Blockchain and integrating with BitTorrent’s BLive streaming service. For many, however, TRON’s involvement makes DLive more likely to end up a centralized tool than a disruptive decentralized social network alternative.

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