The Other Side of the (Bit)Coin with Ben McKenzie

[MUSIC] Hey everybody, welcome to the weekly show podcast. My name is John Stewart. It is April 14th, tax day eve. I think this is coming out tomorrow. What a lovely time we're having. I feel energized, ladies and gentlemen. I feel as though like spring, there's a little crack of sunshine in the shit show that we have been living through this past year and change. Hungary has offered us a respite. They have shown, oh, you don't. There is an opportunity for voters to have the last say. And it filled me with the hope. And I urge you to take sustenance and resolve from their joy and jubilation in kicking out a corrupt kleptocracy. I think that's why I have the energy. It could also be because President Trump did heal me as Jesus Trump. Just recently, if you don't know, go to the picture. But clearly, he's giving me a little bit of veys like a little vitamin B12 shot in the ass. Really, there's nothing like a glowing orb being placed on your forehead. That combined with the election with the orb on. But we're going to move past all that now. We're actually going to get into a subject. I don't know an awful lot about it, but I find it fascinating. And that is the world of digital currencies and coins and crypto and all those different things. And our guide through this maze is an unlikely one. He's an actor. He's a guy you recognize. But he has written a legitimate like non-actor book, like an economist book. Let's just get to him now. Ben McKenzie is going to guide us through the labyrinth. So, ladies and gentlemen, this is, I'm delighted today to be able to bring on a gentleman who has put in the work. He didn't have to put in the work, but he put in the work. Ben McKenzie, welcome to the weekly show. Ben is the author of the New York Times bestselling book, Easy Money on economics and directed and produced a feature film. Everyone is lying to you for money, which, right, frankly, is probably the case. But it takes like a deep dive into the world of cryptocurrency and fraud Ben. John. There we go. Hey, man. We've calibrated. We've calibrated. I'm there, buddy. I'm there. Just the right level. Ben McKenzie, what, so, how did you become involved? Was it what sparked your interest in, in, in this world of crypto, were you, were you burned in a crypto? Did you think you were going to the moon and not get to the moon? What, how did this come about? Yeah, I'm just stranded here on Earth one for now. I'm trying to get over there. There you go. I, uh, well, in a way, I was burned, but it was through a buddy of mine. A buddy of mine named Dave, who's in the movie. The infamous Dave. The infamous Dave. He, uh, I was in my mid 20s. We had gun collage together. I had made a little money in my first TV series and he came to me, uh, in the mid-Auts, I guess, late-Auts and was like, you got to buy stock in this company. And the company had supposedly produced synthetic blood. Um, they were going to make a fortune. Yeah. Um, it's so embarrassing, retrospect. Wait, does this turn out to be Theranos or something? It's not Theranos. It's what it talks like, like, like, like, like somebody had already come up with the idea of the scale. Similarly. I hadn't quite scaled it yet. All right. Um, I know. Anyway, put money into it. Both of us both promptly lost it. And so my lesson, my takeaways don't take financial advice from Dave. So, yeah. In 2020, Throws the Pandemic. He comes to me, you know, crypto's everywhere at the celebrity restaurant and he's like, dude, you got to buy Bitcoin. And I'm like, no, Dave, I'm not going to buy Bitcoin. By the way, what is it? And he can't explain it to me. You know, he doesn't know. I'm like, is it money? It's money? It's currency. It's money, right? I'm sure that's what the word currency means. So what do you do? You buy stuff with it? Uh, no. You know, you put money into it and then, you know, hopefully goes up and you sell it. I'm like, so it's an investment. And he's like, no, it's, yeah. I mean, sort of. Anyway, it got very, um, it was very unsatisfying with Dave. And so I felt like I needed to do my research. Yeah. Do my own research as the crypto folks say. Oh, D-Y-O-R. For God's sakes. D-Y-O-R. So in your research, and this will be, maybe we started the beginning here. So explain to me because I'm, I'm fascinated by this as well. Because I think it exposes sort of a lot of the underpinnings of what you guess would consider the traditional economy as well. But so what exactly is crypto is Bitcoin? What, what, what, what are we dealing with? Uh, so it just started off as an idea that was dropped on a cryptography mailing list in 2008, 2009, a paper that basically said, wouldn't it be cool if you could send money directly person to person and avoid the banks? Uh, which sounds like a pretty good idea. This is October 2008, so it's the height of the sub-run crisis. And, um, the idea didn't really take off initially because, uh, okay, but why does it have value? You know, what can I actually do with this thing? And the first use case was crime. Uh, it was the Silk Road. This. [Laughter] The first use case, by the way, Ben, is always crime. And, you know, as the commissioner of Gotham, you should know. [Laughter] You know this, I know this. It's Gotham, baby. I, uh, that's right. Uh, in its limited defense, the use case was mainly buying drugs online. And I am not an anti-drug. I mean, some of the drugs were a little more severe than, you know, marijuana, my personal favorite. But, um, but yeah, it was drugs. It was buying drugs, although honestly on the Silk Road, you could also order assassination attempts. Um, that's, you know, that guy, Rolce Obrecht, went to jail because he was like, holy shit. Trying to. Yeah, that's, that, you never see that category on Craigslist. That's all right. Health, beauty, you never see the assassination. So, you know, it gave Bitcoin because so what, what Bitcoin is an all cryptocurrencies, they're, they're basically just a record of transactions on a ledger called a blockchain. And the neat thing about them is that your identity is obscured. It's synonymous ledger, not it, not anonymous, but you can't, you can't tell what accounts what wallets are interacting with each other. So you can hide, you know, where you're sending something of value. Now who would that appeal to? Criminals. Right. All right. So I, I want to back this up because this is, I, I do think people get really lost in this in, in that it's sort of hard to understand. Is this, is this meant to run parallel to our traditional financial system, which you imagine is sort of if you, if you break it down, there's banks and the banks hold your money, which we've all decided has value. And they distribute it, they loan it, they do, they do all the different transactions that banks would do. And you can invest that money into things that you might think have value that are tied to things, whether they're commodities or securities or all these, all the various things that, that you can do that are tied to some intrinsic value that we have in the world. Is crypto meant to be kind of a parallel system that's going to improve on that is, is the purpose of it, whatever they thought the downsides of that were, which I assume would be like volatility or exploitation or those kinds of things. Is that what it's meant to achieve? I think, I think the advocates would argue that yeah, absolutely. The skeptics would say, well, the reason that you look, as soon as you say your anti crypto, one of the first attacks you get is your pro bank, you just in favor of the banks. Is that, we'll get into the attack as I imagine coming out against crypto is like saying, you know, BTS sucks like I imagine you get wailed on online. It's pretty funny. It's pretty funny. I've developed a sense of humor about it all. But yeah, obviously, well, if it's not obvious, I'm on this podcast and I don't like the banks, just like you just like everyone in the world who isn't a banker, including perhaps the bankers wives. No, just kidding. I don't think banks are great and we can talk about whether the banks should exist or whether we should just have accounts of the government, which may be, you know, way of sort of the reason that crypto gets so far in its argument is it's really simple. It's the regular, don't you think the regulated system sucks and everyone raises their hands. Right. And then they say crypto fixes this. Now with the banks, what when you're sending money around the banking system, what you're really doing is avoiding the rules and regulations of that system, because the banks are obviously licensed by the government and in exchange for the ability to create not money in the form of loans, they have to abide by all these rules. Do they do it well? No, do they fact fuck up all the time? Yes. But, but that is the system that we've created and they are at least, you know, in some ways, you know, they are, they are, they have to be responsive to the democracy we've established because if they aren't, if they mess up too badly, we pull their license. Right. Crypto says, well, we don't need any of that. We can just go all the way around it and create this thing that's acting like a dollar, but it's not backed by the full faith and credit of the United States. It's a private dollar. It's a dollar that exists outside of the public issuing of money. So to me, that's a counterfeit dollar. The only thing you can really use that for is to get around the regulated system. You could use that for good, but you're really using it for crime. Money laundering, tax evasion, sanctioned, child sexual abuse material, ships are going through the straight up from lose right now paying in cryptocurrency because the Iranians don't want to use the banks. They've been shot out of the banking systems. So cryptocurrency is a way to get around the legal barriers if you wanted to do something. Now, I guess the flip side of that might be, it might also be a way to get around. The Iranians are getting it from ships for crypto. I imagine the Iranian people might be able to use it to get around a repressive regime is that if we wanted to make the counter. That's something that would be useful. Yeah, absolutely. I mean, look, money's a tool, right? So you can use it for good or for ill. I heard a story from a quarter about a woman in Afghanistan who, because she's a woman, she can't be banked under the Taliban. And so she's running a business and she's paying her employees, running her business in cryptocurrency in Bitcoin or other crypto. Now are we being too universalist by saying crypto because there is, you know, look, in this world and I am not in any way familiar with it. But so I'm going to throw out some things and then we can kind of break down. Like, I know Bitcoin, I know stablecoin, then there's meme coin, then there's a, whatever doge coin, which may be a meme coin. Like, are there, what are the different products that exist in kind of the crypto universe and what would be the difference between those products? I would really just separate them into two categories, broadly speaking, which is the speculative cryptocurrencies, which is Bitcoin, Ethereum and the 20,000 other or more, just 20,000 a couple of years ago, it's probably more now. Cryptocurrencies that the price goes up and down, you can bet on them. Would that be like Melania coin and Trumbull? Okay. So that's just a version of it. I think so. I mean, the Bitcoin advocates will argue the tech is slightly different. We can get into that in a separate like there's a different consensus algorithm that runs Bitcoin. It gets a little bit technical. It's all stupid. It's all stupid. But here's the thing. At the end of the day, you're betting that or putting money into it, hoping to make money off of it through no work of your own. That's an investment of some kind. Which by the way, I mean, that's generally that's how the stock market. Right. You know, but that's tied to something. Exactly. It's not tied to anything in the real world. That's what's so interesting. It's just lines of code stored on ledgers called blockchains. So there's no tie to any real world asset. So what are you investing in? I would argue you're really investing in the story of it and the belief that other people give it value. Therefore, it has value. It gets pretty esoteric. I mean, look, money is all made up, right? I mean, we made up the US dollar as well. Sure. It's just the distinction is really fundamental to me and to many other. Actually, economists, I'm sort of an armchair economist, but real economists in terms of of you have any economics degree that's off cell and you know, you V.A. baby, Wahoo Wah. There's no shame in that. I was so close to going to William and Mary. Oh, I really it was between William and Mary. It was why did you make the right choice? I don't know. We used to say William and Mary was UVA without fun. What? Really? William and Mary is so not fun. It isn't. There were two bars in the entire fucking town. Oh, I did make the right choice. I bet you've been to Williamsburg. Yeah. So it's a lovely place to spend a weekend. It's real small. Four years gets old. I mean, Charlottesville felt small to me after about two or three. I was like, I need to get out of here. So yeah, maybe it did. It only two bars. Yeah, shit. I didn't know that. Oh, they don't lead with that when they're giving you two. Yeah. And one of them was a deli. So it wasn't even, I mean, you know, the whole thing was bananas. Yeah. Folks, I'm going to tell you something you might not know about me. I'm a bit of a phone, chatty, Kathy. I like to get on the phone. I like to call up the people. To be honest with you, note I wish I still had the phone in my kitchen that had the cord and you could literally walk like 80 yards with the cord. You could almost make it to school with your kitchen phone on the line. Although nowadays, you take your phone with you so the kids tell me. And if you're looking for a program that'll help you keep that phone affordable there. What a segue. If you like keeping the money, you got to look at your cell phone bill. We all got our cell phone bills. We like to talk on the phone. The thing gets jacked up. It's always getting going there. Well, Mint Mobile is the perfect solution for these overpriced wireless plants. You know, these big wireless carriers. They made a fortune of high bills, bogus fees, complicated contracts. I think they charge me for food. I don't even know what they're doing. I don't even know what's going on in my bill. Mint Mobile is here to rescue a premium wireless plant starting at $15 a month, $15 a month. You like your money. Mint Mobile is for you. Shop plans at mintmobile.com/tws. It's mintmobile.com/tws up front payment of $45 for three month, five gigabyte plan required, equal to about $15 a month. New customer offer for first three months only. Then full price plan options available. Access and fees extra. See Mint Mobile for details. One fundamental critique of crypto is the proponents will say we want a free money from the dead hand of state. We want a money that exists outside of these terrible governments. Okay. You want to decentralize it to give the people to democratize it. Yeah. But then the natural follow up to that is okay. If the money doesn't come from the governments, where does it come from? And they don't like to talk about this. But the answer when it comes to cryptocurrency is corporations. It's world-livenly financial in the case of Donald Trump and all his coins. It's also Bitcoin. The Bitcoin that is mined now, these new coins that are created, they're mined by multi-billion dollar corporations, many of which are publicly traded. So you're talking about corporate money. Now let's, so this is going to be remedial. But we're going to step back because this is where I feel like Bitcoin differs a bit from meme coin. Yes. And you mentioned it, it's mining. So my understanding of Bitcoin is it's a finite system, closed system. And the blockchain technology, whoever gets the correct next answer in the blockchain gets a coin. Is that? Yeah. It's in some ways a game or it's a game. It's a game. It's a gambling exercise. They're running simple mathematical calculations over and over and over again. And early on, I imagine you could gain them a little more easily than now because now that the chains are longer. Yes, the chains get longer. The competition gets more fierce. The price continues to rise on average over time. And it takes a lot of electricity and computing power now to get that. So those Bitcoin farms are corporatized. They're now owned by larger. You can't be just like a Bitcoin dude in your attic grinding Bitcoin in the same way you could maybe early on. Exactly. You're never going to make any money doing it that way. I went to the biggest Bitcoin mine in the country, which is outside of my hometown of Austin, Texas. Okay. And it's a former Alcoa aluminum smelting plant. And they literally call them Bitcoin mines. Yeah, they call it a mine. But it's just in essence, it's just computers. Yeah. One of the things that's interesting to me about Bitcoin and crypto, it's so suspicious, is that they're putting these words on there to give it a sense of tangibility. You know, it's a coin. Well, no, it's lines of code. It's not a coin. It's a mine, you know, as though you're mining physical objects from no, you're not. There's nothing there. So I think the terminology is really interesting. But yeah, it's just warehouse after warehouse. I mean, these are these warehouses where football fields long and maybe 50 feet in the air. And it's just computers, just holy shit. It's crazy, man. It's crazy. Like, and you sit in the middle of it, they have one, I guess the new technology uses some sort of cooling things. So it's not loud. But the old technology was they just stacked them in these warehouses and they had like, the roof was open. And it's March in Texas. So it's sort of in the 70s. It's not that bad. But inside that room, it's got to be 90 and the guys telling me it gets up to 110 in the summer. And all you hear is this, this worrying noise of the computer is running. And it's just like a billion digital. like Jesus. And it's, it's creepy. It's so creepy. And how much in a room like that, like what are they, what is that generate for them over a period of time? Like if you, if you own one of these warehouse server things and I imagine the investment is enormous, what is that generating for you? You hope to get Bitcoin and if you might, if you run enough machines, you know, you're going to get a certain amount of Bitcoin. The economics were working when the price was going up right now. They're not a great place because the price has obviously gone down since the sort of the Trump fur has sort of wain, wain tear. So if you were an early adopter, you're still probably, I don't know what it, I don't know, you're way up. If you got a way or, okay. Yeah. And so I want to actually address that argument specifically. So yeah, yeah. The strongest argument, one of the strongest arguments that crypto has psychologically is to say, you know, you criticize them. They go, well, yeah, but I bet you wish you bought it early. And I'm saying, I know, but you, okay, you're saying if I bought it early to this thing, I'm describing as a Ponzi scheme and a multi level marketing scheme, you're saying I would have made money. That's not really a critique of my, of my criticism because that's an aspect of a, that's a, actually, the central feature of a Ponzi scheme or a multi level marketing scheme is, right. If you got an early, yeah, exactly. The problem is that most people don't get an early and so most people lose. So let me tell you about Amway. Yeah, exactly. If you get an early, you can be a diamond distributor. Right. And with Amway, at least there's a product. Those products may not be great, but like there are an interesting enough multi level marketing schemes are not illegal. You can actually have legal multi level marketing schemes. Ponzi schemes is a different story. And I would describe crypto as sort of a blend of the two. The way MLMs work is your, MLM, multi level marketing scheme is your, is your, you know, it's like a pyramid, it's a pyramid scheme, right? So there's the top, the people that started it, whoever came up with the idea, maybe it's Satoshi in this case. And then Satoshi is the person who did that white paper that you're talking about from, however, many 18 years ago. But no one knows if that's an individual or a collective or anything really. Exactly. And some recent New York Times reporting on that, we can talk about that if you like, but that guy, the guy that's supposed to Satoshi, fun fact, he hates me. He hates, I've never met him. I never interviewed him. He has called me on Twitter. Is that, is that based on the OC or is that based on, I think he was a Seth fan. That's my understanding. No, he does not like, he does not like what I'm saying about crypto. And I just, I'm not to make it about me, but you know, we're here. And I think it's funny. I think it's really funny. He is referring to me as a crisis actor. Now I am an actor. That is true. It is a crisis. He's so close. He's so close together. He's so close to putting it together. Yeah. Anyway, that guy's quite a piece of work. So if Satoshi was at the top of the pyramid, then the people, you know, next to him, who bought it, next would be, you know, right below him and you would go downward. And so a lot of crypto is really just convincing people to buy the thing that you've already bought. Right? The thing you already own, right? Like, hey, buy me, buy some Bitcoin because I bought Bitcoin 10 years ago and I bought it at a penny and I want to sell it to you at $60,000 or whatever. It's weird. It strikes me as it's this, it's almost like a Potemkin financial village. It has all the tent posts of our financial system. But if you look behind it, it's, it's slightly too dimensional. That's why I thought when we talked about it as two separate things, it's sort of an asset and it's also a system. I have to say the system part of it seems like it might have some real value. Blockchain seems like it has encryption value. It seems like it has a democratized person to person value. I could see where in the world that might make, that might make sense. Oh, well, let me just push back a little bit on. Yeah. Because the tech argument has thrown out a lot. Okay. I mean, if you talk to cryptographers, some of the people that hate crypto the most are cryptographers. I mean, the ones that aren't in the crypto industry. Right. Right. Because cryptography has moved on from blockchain. It's not a David Chong, the guy who is sort of credited with sort of, you know, laying intellectual foundation for this in many ways. He referred to Bitcoin to me or blockchain as primitive. It's not, it doesn't work very well. To give an example of how well it does not work, Bitcoin can only process five to seven transactions a second. Visa can do 24,000. A second. A second, five to seven transactions a second. You can see that just will never work as a global payments method because it's too slow. Even, even Sandbagman freed when I interviewed him admitted that to me. I will talk about that. But maybe that, I just want to say and we'll come back to it. That Sandbagman freed interview. Talking bananas. Crazy, right? And this is, by the way, Ben interviewed Sandbagman freed and this is in his, his movie. Before Sandbagman freed is caught or even I think suspected. Yeah. But it is so clearly one of those like weird Mike Wallace shows up at your storefront and is like, sir, would you like to answer a few questions? And the dude is sweating from the minute you sit down. Well, it is because I had the mug that I bought on Etsy that said fraud investigator. Oh, I was doing a little siops on him. It wasn't with him a little bit. Yeah. But you knew, and by the way, Sandbagman freed, he ran the exchanges by which these things are and we can, we'll get into all that in a little bit. But now we're back to talking about, you know, these peer to peer ways of doing transactions, whether it's cross border or within borders or person to person. It's much slower using blockchain, but is there an advantage that there are no fees charged? There's no interest charge. Would that, if you wanted to throw them a bone, would that be what you'd throw them? Sort of. I would say that. So first of all, Bitcoin is the real slow blockchain. There are faster blockchains, but the disadvantage, the disadvantage is a, they don't have the limited supply of Bitcoin. So like you can just print endless coins. It seems, you know, hard to have real sort of supply and demand intersections there or sort of real value. If it's just sort of endless, yeah, if you could just keep printing currency as we've learned. Yeah. I mean, there's some deep, I already had this idea. Yeah. Well, look, I mean, yeah, we can talk about money supply, I guess, but the idea that there's no fees is an appealing story. But I'll just give you one example of how it didn't work in real life. And that's El Salvador. This is Buckelli. This is Buckelli. Yes. So Buckelli gets elected. He comes up with what I now think is really a marketing plan to sell westerners on, you know, coming to El Salvador for tourism, but really sell the country on using cryptocurrency to send money back home. The quarter of the El Salvadoran economy is remittances. It's the two to three people of Salvadoran descent that live in the United States primarily sending money home to their friends and families. So it's really the foundation of the economy. And if you're, you know, sending it via money gram or Western Union, you're paying a fee in that fee can be, you know, it could be significant. Right. So Buckelli's pitch, which sounds sounded good, was, well, we'll build a government system on top of Bitcoin. Everyone will get like 30 bucks of Bitcoin, kind of a giveaway. And then you can use this system to send money back and forth and you'll avoid the fees. The government will take a tiny fee, but much smaller than Western Union. So to be like when those exchanges came up in the stock market, where it was it used to be, you would pay a commission to a broker and each transaction would have a certain fee. And then all of these sort of democratized methods for buying stocks popped up that said, there will be no transaction fees. We won't take it commission. That's in essence what they're recreating. Yeah, I would say with a, with a, with a reminder system. Yeah, yeah, yeah, yeah, yeah, trying to. And so what happens with much fanfare, the system was launched. The price of Bitcoin collapsed immediately, like went down 20% in an hour or something. All the exchanges shut down. That's very weird. Why did the price of crypto crash suddenly? Yeah, why? Well, if you were front running, if you had a bunch of crypto and you had a big publicity event that you knew a lot of people would be buying into thinking it's going to go up, that's the best time to sell. That's my own personal theory. I can't, I can't say that I have a little, a little nation state pump and dump. Little, hey man, that's exactly right. Hey, everybody, I don't know if you're aware of this. In any way, but everything you do is being tracked by the government and other agents. I'm just messing with it. Not really. Thousands of companies collecting personal data on you, trading it. You have no idea it's even happening. You have the right to tell these companies to stop and to delete your information. obviously to go through that and to man that maze on your own is near impossible. To years, by the time you figured it out, they'd be way ahead of you anyway. And that's where this company in Cogni comes in. And Cogni has custom removals features in their unlimited plan. You can point to any website, any website where your personal information is visible. And one of their privacy agents will take care of the rest for you. It's an unbelievable service. You spend months or even years repairing the damage that is done from stolen personal data. Like, I know I'm not supposed to curse in the ad reads, but fuck these companies. Respectfully. Go to incogni.com/stuart. Use code Stuart for 60% off. And Cogni helps wipe yourself from the internet. They can't harm you if they can't find you. Click the link in the description to claim your 60% off and get your personal data off the market in Cogni.com/stuart. Can you make the argument that this is all, it's a solution in search of a problem in that, you know, it's not solving necessarily the underlying issues of whatever our financial system is now in the way that like FDIC tried to address bank runs or those kinds of things and did it, you know, really effectively. Are they trying to, are they purporting that this solves a problem that it A doesn't really exist and B isn't, that it isn't solving? It's definitely that it isn't solving. I mean, I would, in their limited defense, I would say if crypto, if we're to take anything from the crypto story, one of the things we need to take is how bad is our regulated system that people are doing this, that people are regular people are gambling with sometimes their life savings. Right. Well, they're doing that on our regulated system as well. That's what, you know, that's what AMC hold was. That's what, that's what a lot of this shit is. True. And there's always going to be gambling. But, you know, crypto is so unregulated or loosely regulated and it's being forced down our throats in terms of the, I mean, if you watch sports now, it's sports gambling or the ads, it used to be crypto, but it's still crypto.com arena and it's all that kind of stuff. Right. They're really trying to get young guys to buy this stuff because that's, that's their client base. So separating this out from, so there's, there's two elements to it. One is the methodology of sending things. It's sort of the pipelines of sending money transactions across borders, those kinds of things. One thing is the coin themselves, which are these assets, are they just like, beanie babies for bros? Like is it literally just a, this item and they've convinced people that it's a thing. And so now they jump in in the hopes that it does take off and hold its value. But that's really kind of it. Yeah. It's beanie babies for bros or Mary Kay for men. It's a, it's, it's a multi level marketing scheme. And it really appeals to men in particular. And I think that's worth exploring at least a couple of points. The first is young guys like to gamble. Like, I, I, now I haven't, I haven't seen that in this society. I mean, I remember, right? So by the way, I just, I had bet the under on when you were going to bring that up and I'm just going to check the time half hour in. That's a push. The under, yeah, that's a push. And but I already won on my OC reference. So I'm still up. You had a polymarket bet on this, right? That's right. So, so is the idea not to keep that gambling analogy alive, but is the value of this in the people that are creating these schemes, the rake? Is it what the, what the house gets? Are they the house? They're definitely the house, but you're playing in an unregulated unlicensed casino. So you could also win and then go to the teller to cash your chips and the teller winters closed. In the book, Jacob Silverman who wrote the book with me, we look at two guys who are trading on the biggest crypto exchange at the time and still now called Binance, this global crypto exchange. There's a guy in Australia and there's a guy in Toronto. And this one particular day, I believe it's 2022, they are, one of them is long, one of them is betting the price of crypto is going to go up and one has gone short and is betting it's going to crash. Well the price starts crashing and the guy who's long is trying to get out because he's trying to use the value of his, of his holding is dropping like crazy and he's just trying to go. The guy who short is just trying to cash out to get some of his winnings. Sure. Well, they're going to the website and a click in the button and it's not working. So the exchange shut down, which is really interesting. And that's, you're talking about Binance, which is the biggest one. The biggest one and it's completely shut down. This has happened many, many times of a course of crypto history. The price goes down and the exchange is shut down and they come, it takes a lot, I can forget how long it takes, but I think it's ours and it comes back up and they're both liquidated. The guy who was long is just immediately liquidated. Yeah. That's the guy who was short, wasn't liquidated, but he'd seen the value of his, of his crypto, the price when the, when the exchange went online again, the price went back up. So the guy that was short also lost, it's a real, the guy, the guy who was long lost and the guy who was short lost. And I think that's just such a vivid illustration of the sort of fraudulence that we're talking about here. And it reminds you when like the Robinhood app would in the midst of, you know, people holding on to Ames or whatever, like would suddenly make it so that nobody could buy and sell anymore. And you do think, oh, they're in league with, with someone, but Ben, what in your mind, as you're describing this technology, which is unwieldy and doesn't necessarily fix a problem, maybe it helps people in a repressive regime escape or maybe it helps people kind of hold assets if their country is unstable or volatile financially, if they have hyperinflation or whatever that is. So maybe there are certain uses at certain times that can be done. Why are people like BlackRock and Morgan and these like behemoths then validating this? Because it's Wall Street and they're not, they're not taking a right directional bet on it. They're just facilitating the trade. Oh, they're saying let us be the house. Yeah. We're going to catch the rake. Let us be the house. Yeah. I mean, to give you an example. So, so let's say you buy Bitcoin through an ETF, these exchange traded funds where you're basically sort of like a mutual fund, like you put money in and you're going to get a fractional part of a Bitcoin. So those have already been put into ETFs. Yeah. Like, okay. And it's like a hundred billion dollar market or something already, which is terrifying. If you think of it as like a, yeah, it's insane. So if you buy it through BlackRock, let's say you buy your Bitcoin through a BlackRock ETF, all BlackRock is doing is taking your money, going to Coinbase, these crypto exchange and saying, hey, here's the money and we hold a piece of Bitcoin. We don't BlackRock never even touches the Bitcoin. It's just facilitating the trade. So Wall Street is happy to do this and take a tiny fee for their service. Well, it does not blow up the whole decentralization of this whole thing. If the whole idea of it is peer to peer or you don't have to worry about the governments of the world to have fucking BlackRock involved, I mean, the democratized decentralized future of money brought to you by BlackRock. Right. What are we talking about? This is nonsense. This is total nonsense. No, I mean, so many of these arguments that they make are so flimsy and they contradict themselves so often. I mean, the ultimate irony that the democratized decentralized future of money needs the president of the United States to be its pitch guy. Like it needed. It was down and out after 2022. You know, these guys were going to jail. The price was down and then Trump comes back in. What happened in 2022 that caused because it was, you know, listen, Bitcoin, if you were one of those guys that, you know, in the early adopters are like, I've got 1,000 Bitcoin in a wallet and it's worth $40,000. Yeah. But then Bitcoin goes up over, I don't know, 100,000, 110, you know, whatever it got up to. And suddenly these guys are billionaires. And then it plunges again. What plunged it? Was it Sandbankman-Freed? Was it the collapse of, you know, one of those, I don't know, the indexes. Changes, right? Yeah. Yeah. Yeah. Yeah. And any collapse is hard to know sort of, you know, what the first butterfly to flap its wings was. Right. Especially something that you don't think is really tied to any kind of intrinsic value. Yeah. But basically an enormous amount of speculation and leverage had built up inside of crypto. Where to give you an example, Binance was allowing 125 to 1 leverage for a retail trader. Like a regular guy could borrow $125 against every $1 that he put in. Wow. Yeah. And if it's going up, but if it's going down, also put that in like, I think the 2008 financial crisis was caused by like banks going 30 to 1 on leverage. Yeah. Like not. think about that in the, you know, and the collateralized obligations that came in after Dodd-Frank brought that even that down by like half. Yeah. And we're talking about, you know, many, multiples of that. So when the mark, when the, when the, so it pumps it up, the leverage helps the pump up. But when the pump, when it starts to correct and go down, it speeds that up process up to as people are constantly trying to sell these worthless currents currencies. I'm using air quotes, worthless currencies, and there's not enough buyers to actually buy them. So this happens a lot. And that's why you saw an enormous number of crypto companies go bankrupt in 2022. But what happened in 2024 is Trump's embrace of it said to people, well, look, he's a good chance he's going to be president. He came out publicly in the summer of 24, probably 50, 50 shot. And if he is president, he can do a lot to pump this thing up. And people will see that. So I need to buy now. So the price started to go up, went up more and more and more. And by the time he's in office, it's a, it's a hundred and twenty thousand dollars of coin. It's the highest it's ever been. And that's across only Bitcoin. That's not including, I don't know if it's a theorem or whatever else that's, that's literally Bitcoin is 120. And did the other coins follow Bitcoin? Like if Bitcoin goes up to the other coins and other exchanges also go up or that they're not necessarily tied to each other. Not necessarily, but there is a broad halo effect. Yes. I would say, which is sort of interesting to look at if you're trying to understand how the market works. But I, you know, really have come to think of these cryptos as the story that you're going to be, you're going to get rich for the retail public. This is the story you're going to get rich on this stuff. Sure. Economics, that's kind of call, that's called a greater fool theory. You never want to be a part of greater fool theory when it comes to money. Well, well, it's when the price of a speculative asset rises so much that it's really unlinked from any value you could have in the real world. It's not based on its value. It's based on the value you expect other people to give it. So you're constantly trying to sell you buy the thing, thinking you could sell it for more to a greater fool than you, which is a fun game until you end up on the top and you're the biggest idiot left holding the bag. It's a fundamentally unsustainable dynamic, but they can't last for a long time. And there's also these things. I'm a big behavioral economist guy. That's really my bag. And Robert Schiller, famous behavioral economist, talks about naturally occurring Ponzi schemes. Is that involved tulips, by any chance? Yeah, exactly. Same dynamic. Somebody, some product, something gets a value. The price is starting to go up. People see the price going up, which draws the men, which sends the price further and draws more people. And these things can last for a very, very long time. But if they are actually Ponzi schemes, if there isn't actually a product underneath, I mean, at least with tulips there was a flower. Right. With this, you're talking about lines of computer goat. You know, eventually they have to collapse. But that's what I mean by this whole system appears to be a funhouse mirror of our actual financial system, which includes all of these kinds of downsides, some speculative assets that seem to rise in value in ways that don't connect. Big actors that come in and make transaction fees that, you know, payment for order flow, you know, all these different ways that our system is skimmed and tries to avoid regulation and creates the lack of trust in the system that you're talking about that allows this parallel system to flourish because people are so frustrated, especially on the retail side by our actual system. Yeah. And so I think crypto should force us back to fix the problems in the system. If we're going to learn anything from this, it's not that crypto is the way, right? That is, it's worse than our regulated system, which is saying a lot. But it is saying we need to fix these underline. I mean, the fact that so many particularly young guys believe that they really can't get ahead that like their the deck is stacked against them. I'm not trying to give too much credence to it, but I do think it's, it's a real feeling that these guys are having like, how am I going to for the house, right? How am I going to and those exploitative aspects of our actual market are real. Very much. You know, we're not all operating on the same information. There are guys that purchase real estate so they can put microwave towers next to it so that they can make transaction money. It's not the crypto whale that creates volatility selling back and forth to anonymous, you know, IP. Talk about that because that, that to me is such an interesting phenomenon in this online world, which is sort of phantom transaction. Yeah. Yeah. Fake trading or wash trading, I guess it's because the pseudonymity of the blockchain obscures who's trading what you can basically take a dollar in one hand and flip it to the other and back and forth and back and forth and bid up. That's a beevison but had episode. Yeah. Oh, that's how beevison but had had 20 chocolate bars. Okay. And bevison had a dollar. So he gave but had the dollar but had gave him a chocolate bar. And then with the dollar, he bought the other one and by the end of it, all the chocolate is gone and they still just have one dollar. My judge. My judge. The best genius genius. There's also a very funny, always sunny in Philadelphia episode about a guy's creative currency but it's like a Ponzi scheme. They can't figure it out. Anyway. So you can basically make it look like there's a real market for a coin and you're bidding the price of the coin up, but all you're trying to do is lure in people that are actually putting money into this thing, right? Because if you're just trading it back and forth, you pay more paying like the tiny fee that it costs to do the trade. And quite frankly, there's a lot of evidence that the exchanges at least have been in on this action, right? Like they're oh, really, even even the bigger exchanges. Yeah. In the past, I don't want to say anyone specifically, but like, I mean, to get you an example of how weird it is was Sam, Sam Vagan, Fried's company. He had an exchange at FTX, which everyone knew about, but he also had a trading firm called Alameda Research. And they were in the same building in the same floor right next to each other in the Bahamas and his ex girlfriend was running the, I'm using air quotes for that was using was the CEO of the trading firm and Sam was running the exchange. I mean, in a regulated market, I mean, you can't get away with that. That is such a blatant conflict of interest. But it's not so far off from Citadel. It's not so far off from a guy running all of the orders, you know, having, I don't know, maybe percent of all the flow orders on Wall Street and having his own fund. Yeah. Like that does occur even on a, I guess that's my point is it, it may be a Potemkin village, but it's mirroring very real conflict of interest and other things, even within our regulated system. It's sort of a bizarre aversion of it, right? It just sort of takes that even further in terms of the right, you know, information asymmetries in terms of the manipulability, that's not a word, the manipulability to manipulate the market. Is there anything worth saving on this? Is there what would do you securitize it? Do you? What do you do that? So I think you do two thing. I mean, if I were, you know, King of the World for a day, I would say securitize all the speculative ones. The reason that the crypto industry doesn't want that they sort of were randomly categorized as commodities in like 2015. It's a very sort of strange, fluky thing where they were selling futures and because they hadn't been classified as a, as a security that the CFTC, the commodities future trading commission could claim that they were commodities, monies, real money. Like oil, like oil, and soybean, okay, and currencies. Currencies are classified as commodities. Okay. So that's the argument. The crypto market was so small at that time that I don't think a lot of people were paying attention. But if you look at them as we've discussed, they really operate like securities and the crypto industry is so terrified of having their products classified as securities because securities law is predicated on disclosure. You need to know who you're giving your money to and what they're doing with the money and crypto doesn't want that, right? So there's a bill that is threatening to pass Congress that would put cryptos under the supervision of the CFTC. And that's the same thing. Sandbag been freed wanted when he was spending time on Capitol Hill in 2021 and 2022. Now why did he want that bill? Tia, I don't know. I mean, you want the week. So the reason you want the CFTC in charge is not just because of the disclosure of securities, but also the CFTC is the smaller, weaker regulatory agency. Rather than the SEC. The SEC is stronger by comparison. And by the way, just to point out something that's really glaringly, it's such a huge problem in our economy. system. We're the only country in the world that separates our securities regulation from our commodities regulation and puts them in rival agencies competing over jurisdiction with rival committees in the house. You'd almost think it would weaken both. You might. I mean, it just creates all these perverse incentives because the committees that oversee these agencies and the House and the Senate, people want positions on the committees so that they can get the donations from the industries that they're supposedly regularly. And these crypto guys have not been shy. I mean, there's that infamous dinner at Mar-a-Lago where the buy-in was an insane amount of money to get to sit in a room with Donald Trump and let him talk about how we're not going to regulate you at all. Yeah. If you bought the top, whatever it was, 10, 25 holders of his coin got access to the president. 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I mean that because they need to left every retail person holding the back. Yeah. But the guys who put a lot of money in, they sure they couldn't quote lost the money, but they got access to the president. So they got something for their investment, right? Right. They bought money. Did they were they front running? And they actually ended up making money. I'm sure some of them were. But the insider's always benefit in crypto. That's really the repetitive theme is like listen, that's that's the whole. Just true as a regularity says miss even it's just more pronounced. I would say take it to another level in crypto. You know, the irony to me that we haven't convicted fraudster president, right? A guy who's convicted of 34 counts or his organization is that he ran his company 34 counts by a jury is now hawking the fraudulent coin. And the people who believe in decentralization, democratization really, really need to be said on his good side. Right. Right. It's really delicious. I have to say on a dark, dark level. That's funny. Now if them, so I don't know where Bitcoin is, what is it? Rav 40,000, no 70. Yeah. It's in 70s. I don't know. Okay. So it's still while if you were in early, it's wildly valued like those people still may what then would cause this to go up again other than some sort of I don't know is it that the supply would run out? And like why would it elevate any more? You know, I'd be hard to, there's so many reasons. They're it's hard to say. I think what has happened while we're focusing on the price of Bitcoin, that's kind of like the, you know, the bright shiny object that sort of distracts us. What's happening on the other side is these stable coins are growing like crazy. You know, there's hundreds of billions of dollars. Now what are when you say stable coins, talk what is the the meaning of stable coin? It's supposedly a stable cryptocurrency whose value is pegged one to one with a real currency like the US dollar. Okay. So it's not a meme coin. These aren't the ones where like Elon Musk throws a picture of a dog on a coin. The thing rockets up and then, you know, whoever is one of the whales or whoever the people that are front running, make a shit ton of money and everybody else gets fucked. This is actually pegged. So this is an attempt to peg it to a real currency to I guess get the advantages of low fees and transactions and the ability to move between borders is that without their fix without going through a bank. Yeah. So that stable coin is an attempt to fix some of the more egregious problems within crypto world. Yeah. If you want to avoid, if you're a criminal and you've gotten something of value, you're trying to send it somewhere else to sort of wander your money or to I don't know, engage in some transaction with another criminal on the other side of the world. You'd rather not have the volatility of Bitcoin and other cryptocurrencies, right? Because you could be on the losing end of that. You'd rather have something that's stable that you can send. Right. So unless that currency has high volatility, it's not going to be like we're at 120. Now we're at 90. Now we're it. You're not going to have that rocket ship. Yeah. You'd rather use something that's quote unquote stable. And so these stablecoins have grown enormously. And to give you you how example of how intricate this system is, it's things like Russian oligarchs selling sanction oil to the Chinese in the form of crypto to buy drones to send to Ukraine. And it is wild. That's the silkyst road of all. It is, I mean, you were talking about last year, a crypto organization estimated crypto company estimated that $154 billion of illicit activity was finance via cryptocurrency. $154 billion last year. And that was a crypto company that made the estimate. Here's what's fucking crazy about that. So Donald Trump, Donald Trump is literally shilling for the product that allows our enemies to avoid our sanctions. Is that what this ultimately yes wild. It's wild. And to give you an example of how deep the corruption goes, the biggest stablecoin company by far is this company tether. And tether is their broker is Cantor Fitzgerald and Howard Lutnik was the commerce. Yes, that's how I mean, guys, we're talking about through tether. Yes. And like who knows what's actually going on because you said it's synonymous. But is it possible that through tether Russian oligarchs are moving oil to let's make it worse, moving Iranian oil to China in exchange for drones and weapons. Well, it's not like it's not possible. It happened. It does happen. I mean, if you you can write, you can read stories about it and Howard Lutnik profits from that or his kids technically because he's technically not the, but I mean, come on, what are we talking about? Yeah, holy fuck. Oh, yeah. And then I mean, can we talk about Jeffrey Epstein for a second? I'm not not that I'm aware of. I don't think I don't think you're allowed to. Yeah. Was he an early crypto do is that what that was? Yes. Yes. Yes. So his sex trafficking was enabled by that same system. One can assume I mean, we don't have evidence of it because again, synonymous, synonymous, synonymous, ledger and who knows, but we do that and redactions and redactions. But here's what we know. We know in the emails that Epstein was funding something called Bitcoin Core Development, which is the group of programmers, software engineers who maintain Bitcoin's operating system. Yes, there are people behind this supposedly, you know, computer completely computerized future. So he was funding that through the MIT Media Lab. You remember the MIT Media Lab? There's a blow up some years ago, the article in the New Yorker. It's like this offshoot of MIT, this guy, Joy Eto was running and they were, had relationships with a lot of very wealthy people, including Bill Gates and funding various projects. So Epsim was basically funding, keeping the Bitcoin system alive in 2015 at a point when it was kind of languishing. Silk Road had been shut down. There was a lot of fighting. And why would, why would Jeffrey Epstein like crypto well if your main businesses are blackmail and money laundering? You know, we have buried the lead here, Ben. We have spent a good amount of time parsing what all this stuff means. And now we're in the good stuff, which is, and how is it deployed to undermine our society? And the like this feels, I don't want to, like this feels water gated times a million. There's, there's too many directions to go and there's too much corruption. It's like, I feel like a Charlie day and always sunny in Philadelphia. I got the pens on the board. I'm going to find it. Yeah, to give you another example, that guy who's supposedly Satoshi, the guy that hates me, the guy had him back, who called me a crisis actor. His company, Blockstream, received an investment from Jeffrey Epstein. We also learned that in the files. What? There's an email from, from his co-whoever stared at the company with Adam and Joy Eto confirming Epstein's investment in their company. Right. Back says no that didn't happen, but there's an email. People can read it for themselves and judge whether, but here's the other fucking crazy thing. Lutnik lived right next door to the guy. Yes. And visited him on the island. There's pictures. They tried to hide that. There's a picture of them on the island together. But this is where boy, I, you know, like, okay, that guy is now the poster child of this, you know, corrupt Silk Road and real life system of depravity and degradation and exploitation and all those different things. But you're also talking about people at the highest levels of our government right now enabling a system that fuels the very types of weapons that are killing our own soldiers. Yeah. Like that's unforgivable. It is. I was so angry when he unsanctioned that Russian oil. You know, when he decided, oh, shit, I fucked up. I went into Iran without a plan. And who could have predicted the price of oil would go up when you start a war around the straight of our moves. And then he has to unt, he has to. He doesn't have to. He does unsanction the oil. And the Russians at the same time were reported. It's been a lot of warning us. We're providing intelligence to the Iranians to kill our guys over there, right? They were trying to help the guys were fighting against and we're rewarding them by unsanctioning their oil. This is fucking madness. You know, at the selling point, the whole selling point of this thing is it will allow poor people to avoid those financial fees of international transactions. It will allow dissidents to still be able to live and pay for certain things even though their governments are repressive. But what it really is is oligarchs and arms dealers and corporate titans controlling a black market of war and degradation around the globe. That's really what it's been. That's the most utilized war. Yes. And overwhelming majority. Of course, you can't find, you're never going to get a statistical breakdown because again, pseudonymity of the ledger. It's purposefully trying to be obtuse. So on tether, could you go on tether? Yeah. Could you go on tether and track whether there are transactions between illicit oil shipments and weapons? If you, if they gave you access to their blockchain, and they don't have to do that. Well, I don't only went to a lawyer. They have on occasion when forced to by law enforcement, when to have like threatened with, well, if you don't do this, we're going to go after you. They have given over certain limited, you know, clients of theirs. Their, their, their rationale for this is, look, we don't, you know, money can be a regular money can be used for all sorts of bad things. We're just, you know, we're just issuing the coin. People can buy and sell it. We don't, you know, we don't control what they do with it kind of a thing. It's preposterous because article after article after article goes specifically to this company tether and specifically to all of the different ways in which it can be used to finance criminal activity. We're talking about global criminal cartels, you know, South American drug cartels, but also Chinese triads, but also, you know, ISIS, but also North Korean actors. So this is in a way, in the way that the US dollar has been utilized as a weapon, the weaponization of because we are the global currency, the way that we weaponize that is through sanctions on petrodollars or the oil system or any of those other things. And the way they get around it is the exchange that is owned by our secretary of the treasuries company. That is what we are, the stablecoin company. Yeah, yeah, they have an exchange too. But yes, the stablecoin company is represented, their financial interest is represented by our current secretary. I don't know how that's not. I don't know how that's to idiots in a podcast talking about that. And that is not a global corruption scandal and crisis. Is so I've been doing this for four or five years and you have your high high moments in your your low moments. But Trump's, you know, the reason that Leightonet came on Trump's radar is all the sudden he was raising money for him in his campaign, right? He was the co-chair. Right. And there's all these stories from the summer and fall of 2024 about these incredibly lavish fund raisers where Leightonet would host him and they would raise a million dollars ahead or whatever to go into their super PACs. And you know, it doesn't take a rocket scientist to figure out that some of that money is, well, that the money is, the money is given with the expectation that there will be something in return. And what's been given in return under the Trump administration for crypto is they they disbanded the cryptocurrency crime task force that the DOJ had set up. They've ripped apart the SEC, hundreds of lawyers have left the SEC. They've gotten this bad bill through Congress called the Genius Act that allows corporations to issue their own money in the form of stablecoins. That's what the Genius Act does. Wait, what? Literal corporate money. Yes. Yes. So corporations not only are they people, not only is their speech protected now by the First Amendment and their money is considered speech. They are also their own nation states with their own currencies. Yes. Yes. And I want to say a hundred, a hundred Democrats voted for voted for this legislation, including a Kim Jeffries and my congressman Dan Goldman, which is why I'm supporting Bradley Andrew for Congress. But I am outraged that the Democrats, because they're so fearful of the crypto lobby, which has so much money and they do have an enormous amount of money to spend clearly in 20, clearly. I don't want to say where they got it from, but exactly in 2024 to give you a sense of how big this is. It was $240 something million and it was 40 something percent of all corporate donations in the cycle came from crypto from the crypto industry and the companies, the players inside the individuals and the companies. 40 percent of all the money. That's like more than the defense industry in the pharmaceutical pharmaceutical industry combined. It's crazy. And how is this not the bubble of all bubbles then? It might be. I mean, I describe it in the movie as the largest Ponzi scheme in history. I didn't know it was going to come back and reinflate. But, but you know, sometimes that does happen. We'll see. But has it in some ways been reinflated even? So now the question is has it been reinflated by what you call the fool theory or has it been reinflated by international money laundering? Both. Both. Yeah. I mean, the scary parts of me is that crypto is notoriously volatile. It seems as though we are getting close to being in a recession. If not, they're already we're we're certainly slowing down a lot economically. And this war is such a disaster already that it seems like inflation isn't going away anytime soon. If the economy goes down, then, you know, traditionally, historically, if there's a correction, the most speculative things, most speculative things fall the fastest. And if you think crypto is only speculation as I do, on the retail side, what happens when these ETF holders try to sell, you could sell a billion dollars worth of these ETFs. T.S. But let's say you tried to sell $10 billion in a day and there isn't there aren't enough buyers on the other side. And the whole thing collapses just like it did in 2022, but instead it's now tied into our regulated system. Now all of these Wall Street firms are in on it. Now, you know, they're getting banking. So now it's a subprime contagion. They recreated the thing that was created in opposition to subprime has effectively recreated subprime. And there's not even homes involved. So it wouldn't, would, would crypto be a hedge like would, would they can, if the actual financial system falls, does crypto function similarly to like gold and silver? Does it then hold value as a hedge against societal collapse? Because somehow it's an intrinsic value item that isn't tied to any of this other shit. Yeah, I mean, that's been the pitch. And if you go deep like the hardcore crypto people, and that's a very small group of people, but the hardcore ones are sort of anarcho capitalist guys who are like, you know, we kind of want this system to fall apart and then we'll be saved by our Bitcoin. That's pretty crazy. That's really pretty crazy. But historically what's happened when inflation goes up is that crypto goes down. That's what happens in 2022 in the film is the inflation had started to, so, so crypto really took off during the pandemic because there was all these, there were all these stimulus checks. People were sitting at home. Right. Guys, they needed something to gamble on. Look and go to the moon, right? Yeah, yeah. So, so that happened. But of course, then the result of the easy money was inflation. And when that became sort of unavoidable, the Fed or undeniable, the Fed had to raise interest rates and right around when the Fed raised interest rates in March of 2022, crypto was just nose diving, just, you know, dropped my half or something in the span of six months. So, I hope it doesn't happen again, but if history is any guide, it will. Well, the reason why it might not is because if you think about it in that way, crypto is in some ways an ETF of black market goods. It's an ETF of the illicit markets. It's an ETF of gun running and drug running and sex trafficking and all the ways that international you know, cartels will avoid the regulated system. Does it ever have to reconvert? Is there is, you know, when if you're moving crypto and is it a barter system and crypto is kind of the linchpin of it, it's not like they have to take that then and then reconvert it into, and I don't know, maybe they do this with stablecoin, reconvert it into actual currency. Yeah, most of the time they do and they do that through things like over the counter desks where people are actually giving dollars like or whatever physical currency and the porn bills for. So, a lot of the transactions that actually occur in crypto don't happen on the ledger. You can have off ledger transactions, which further obscures the identity of who's trying to try. You can give somebody, you know, I can give you 50 bucks and you can give me your crypto coins, right? And so, they're their version of dark pools. Yeah, exactly. Exactly. And so, you do most of the time you do need to get into a real currency on the other side, but not necessarily. There is this sort of digital, what's the system in Southeast Asia? Oh gosh. I can't remember. It's, it's, it's, it's, it is a way of sending. If you're sending something, if, if basically the criminals have reasonable, reasonable assurance that they can transact with each other and get something that they want and exchange for something that they're selling via this crypto stuff, then maybe they don't have to cash in, right? If the, if the Russians sell the oil and get the drones, then maybe they never have to really cash out. Do you have a sense at all of how much of this has been adopted by rogue states and how much of it is used to evade whatever we would call the kind of international, you know, rules based order? How much of, of this system of payment is being utilized for those actions? To give you one example, North Korea has teams of hackers that hack in and steal people's cryptocurrency. Half of the North Korean nuclear weapons program has been funded via cryptocurrency. Are you fucking kidding me, right? Wall Street Journal. Wall Street Journal, look it up. It's a guy. Why is it, I don't understand this. Why is this is blowing my mind? Dude, it's so wild. It's so, I mean, it's, you get so depressed because you're like, can we, nothing, it feels like nothing's going to happen until Trump's out of office, right? But you just said a hundred Democrats were like, hey man, it's cool. Do they not know? Have there been government hearings on the actual usage of this stuff? Well, there was one that I testified to and then the crypto lobby spent $40 million defeating Sherrod Brown, the chairman of the committee, the chairman of the Senate banking committee. They spent $40 million to that race in that race alone. That's one center race in Ohio. In Ohio, $40 million in Ohio, this was pretty far. And they elected a literal car salesman instead, Bernie, Bernie Marino, who's pro crypto, it's shocker. What? No. So I don't think that, I mean, look, I would love to talk to an elected representative on camera who voted for it, who's a Democrat and have him explain his deep understanding of blockchain technology. But I'm going to just take a wager, a guess, a wager actually might be the nice, appropriate way of phrasing this. They're afraid of them. But even that, you know, the fact that they don't separate out, let's say if there is value in these coins and they don't want to ultimately undermine whatever it may become or a kinds of thing, the idea that they wouldn't step in to prevent bad actors from using this very same thing to undermine the security of the United States is a mind blowing proposition. I, you took a lot on the podcast about how the Democrats have really the, the, the Democrats in power, the elites in power and democratic party have made this decision or a series of decisions starting from a while ago and shows in capital over labor. Man, are you? Yep. And, and crypto is just like such a vivid illustration of that, right? This is a thing that's a net negative for people in general. Most people who've got invest in. Well, it's unrelated to labor in any way, unless of course you work in a crypto mind, but it's, it's unrelated to labor in any way. It's the purest form. It's like the tron of capital. Yeah. And they're choosing that side. I hear that there's this, the clarity bill, which is trying to work its way through Congress. And I hear that Chuck Schumer is pressuring the, there's a working, there's a caucus that's sort of trying to figure out the Democrats position on this and he's trying to pressure them to agree to whatever deal the banks are coming up with with this, the crypto companies to get this legislation through. How do these banks not, how did they, are, are, do they plead ignorance to what this is being utilized for? Like the way you laid it out of Russia and oil and weapons and drones, like are they going to pretend that that's not the manner in which this is being utilized? Yeah. I mean, as long as I can make money on it, I feel like. Yeah. Right now, what's funny is that the, so what the crypto, one of the things that crypto companies want, crypto exchange coinbase in particular, is it wants to be able to offer interest to people that put money in the form of a stable coin on their exchange, they want to be able to offer them interest, which sounds an awful lot like, like, like a loan, right? Like something that a bank would do. And the banks don't want them to be able to do this because that's cutting in on their core business. So there's a fight between the banks and the crypto companies and when the banks are the good guys, when the banks are the ones that are holding the line and saying, well, we should have some rules, guys, there should be, you know, a KYC and AML and you're like, oh, we're so fucked. We're so fucked. Wow. This is bananas, Ben. It's really, is this a full time gignal? What are you going back to acting? Like what? Or is this, is this your white whale? Are you the A-hab going after this? I don't know. I'm so ready to go back to show his now. This is good. So I miss people. I miss interacting with people on a set. I really, I mean, I'm with you, man. Writing books is lonely. Making documentary films is wonderful when you're shooting them, but so much of it is the post process and it's virtual and you're lonely. And I'm like, so yeah, I'm working. I'm trying to do action TV. I want to create a show and do that. I think crypto will be, will be a part of my life, most likely, you know, moving forward. And that's okay. I hope to continue to be an advocate and talk about these things and quite frankly shame. I can't control the Republican Party. I'd sounds like no one can other than Trump. But if that's what we mean by control, I don't know whatever that is, the free for all that's over there. But with the Democrats, I can at least speak, speak up and speak out about. And there's a possibility for influence. Are there other, I have found that celebrity gives you the opportunity to shine a light, but you also need allies. You need people who are the people and the trenches doing the day-to-day grunt work of advocacy. Do you have allies within that world that together you can form a really formidable kind of battalion to go after this? I'm trying. I'm working on it. I know there are a lot of organizations. I've done some videos with more perfect union. The group started by Fashaker and a few others. I Americans for financial reform is a great organization that is really trying to protect consumers. One of the things that Trump has done, his administration has done, is just rip apart the CFPB, just destroyed it, sending those doge idiots. Well, they just defanged and defunded and pulled people and that's their consumer protection is no longer. Yeah, yeah, yeah. Well, that's not freedom, John. You need freedom. Freedom to exploit. Freedom to be screwed. I, yeah, so I'm working with organizations like that. I would love to continue to work with others, but I do think it's going to take kind of a grassroots effort. No question. And the idea that you could put that kind of shaming campaign but have real stamina behind it so that they understand, you know, it will be exposed and you won't be going away. I wish you well to hell of a story. For those of you out there who would like to learn more about it, follow everyone is lying film on Instagram or go to everyoneislying.com for updates on where it is or where the film is or any of those other things. Ben, jeez man, hell of a job, hell of a deep dive, is the author of the Near Times bestselling book Easy Money. You gotta get it. It's a fascinating read and everyone is lying to you for money, which is the documentary about this industry. Ben McKenzie. John Stuart. And say hello to your lovely wife. And I look forward to seeing you also playing some kind of cop. Indeed. All right. Inshallah. Thank you. All right. Good talk to you. Good talking to you too. Guys, what the fuck? Yeah. What was so crazy. So I know we had to spend a lot of time just being like, and what is it again, Bitcoin and then what's a stable coin? There was a lot of remedial like, what are the terms? How does this work? What do they say that it is? And then it was just like, he was just like, set me up. He was just walking me down the street like, oh, let me walk you down this. You know what it felt like the end of Planet of the Apes. We're like, we're having a nice time. Dr. Zayis is doing these things. And then all of a sudden, I turn around and go, is that the fucking Statue of Liberty? It was Earth the whole time. Wait, what? Where are we? Yeah, you can really tell he's been sitting with all of this digging through the Epstein files looking for clues he's dedicated. It's I told him it's you're not an actor who wrote a book. It's like you're an economist who happened to be in the OC like, by the way, OC. Yeah. Yeah, I don't know anything about it. I don't know. I was trying to tell Trace. I was like, I think he was on like Laguna Beach and she's like, I think that's a documentary. I'm like, all right. Well, he's on one of those. Similar next week. We'll have Laguna Beach. Did you know anything about these like when he said, Kenneth Fitzgerald has the leading interest in tether? I was like, wait, because if that's being used to undermine our sanctions. Yeah. I mean, it's even closer than that. I read something this morning in the Washington Post. I don't want to get it wrong, but it said, Trump and his family made more in four months, the first four months of his second presidency off of his meme coin than four years running his Washington DC hotel during his first presidency. Wow. But yeah, I mean, it's incredibly entangled with our financial system at this point. Yeah. Like, and just sort of runs through, you know, this decentralized form of currency just runs through all of our very central banks and is honestly like tied up too with our very real money. But I remember, do you guys remember when we discovered like HSBC had money laundered for certain cartels? Yeah. Like any Ron. And it was a giant. Yeah. And listen, right. And, and, you know, the SEC and the DOG never catch up with anything. And they're just like, Oh, I'm sorry. Did we make $10 billion over that? Here's $2 billion. We're cool, right? So cool. This is, this is so much worse. If the titans and pillars of our financial industry are the very conduits to this black market economy that allows the United States enemies to evade any of our sanctions. What are we doing? I mean, we ourselves are evading our sanctions. We're buying oil from Iran. Like, it's very, I don't know how serious any of the stuff is anymore. Yeah. And I remember reading that last year Iran's crypto currency ecosystem grew to like nearly 8 billion. Like, it's not small. The, the voiding of sanctions most likely. And, I mean, we're the largest holder of Bitcoin at this point. So it's really a tool of states and it's going to keep spiraling if all these politicians have no incentive to regulate. And here's, here's my guess. Even Khamenei wouldn't be so shameless as to create an Iatola coin. Even Khamenei, he would be like, look, I don't, I don't want to rip people off to that extent. I'm a crazy little scammy. I'm a crazy dictator who wants them to live in. But I, even I would not. That's a bridge too far. It feels dirty. Just feels dirty to me. Yeah. That's fucking crazy. Brittany, Brittany, what, what do people want from, from us this week? Here we go. Come on. John, do you think presidents and governors should have the power to grant partners? Oh, it depends on if I'm friends with them. I think I do think there is value within the pardon system. I just think you, it has to be done where you're like rod and real fishing, not just throwing a net at and going, yeah, all right, the 3000 people, they're fine. But I mean, I would say the pardon, it just shouldn't be absolute. There should be some process within the court system that can readdress those that are and look, let's face fax, the Supreme Court has made it so that corruption no longer really exists in this country unless it's like you write on a piece of paper and go, here's $10,000 and you have to do these three things like unless it's such explicit quid pro quo. But I mean, the selling of partners, the fact that money grants you access to our judicial system in that way. Don't rich people have enough of any advantage. Give them more. Why not? They're all satisfied. I mean, would you guys get rid of it completely? No. No. Well, it's hard. I feel like now with the ways that we're seeing it so abused, it's like you would kind of rather that it just went away. But like we have such, there's such failures in the justice system that you want something to exist in that regard. Right. And you do want to readdress and think about what felonies do to a person. It's like and you do want a system that allows for mercy and grace. Absolutely. Yes. I mean, I would love if it didn't have to go all the way to a presidential pardon or governor's pardon in order to get that justice for people. But sometimes it does. Oh, Gillian, I don't know what are the kids do now? They do this for their fingers on that. That's I'm giving you. Although, you know, when I was a kid, this was just the way that you attacked your brother. All right. What else? What else? What else? John, is it just a coincidence that TDS stands for both the Daily Show and Trump Transition Syndrome? Yeah. Listen, we were here first. That's all I'm going to say. These are my initials. If anything, this is copyright infringement that that that he is purporting on us. But we were here first and it will always stand for the Daily Show. Of course. John, do you think that with those initials and you possibly appearing in an image of Trump as maybe Jesus that maybe someone sending you a sign? Listen, when I saw that image. Yes. And I the people in Zipaka, they can't you can't see the image. There's the image of Trump as a I'm sorry, he believes as a physician. By the way, wearing, you know, it's literally the picture you always see of Jesus with the light in his hand, healing somebody. But somehow Trump was like, I think that's from the pit. Like he says such a fucking, like he's such a lazy liar now. He doesn't even he's that he's that comfortable with us that the magic has gone from our relationship. He doesn't even try anymore when it comes to the lying. When I did did see that image I was like, wait, I know I don't look great. It is un-canny. Truly honestly. When I saw it, I thought it was you, and then when you brought it up, I was like, oh good, it wasn't just me. Can I tell you what's most upsetting about it? Is it's clearly an AI picture. So somewhere had to write in, Trump as Jesus with Eagles and fireworks and all this stuff, and just grab me a sickly looking man. (laughing) Like that's clearly the prompt AI was, and we need somebody in the bed. Somebody robust? No, no, no. Make it like somebody that looks like they are in a bed in need of divine healing. Brutal. And it's fucking exact, like it's not even, oh that, like I really thought like, did they use a, like is that what that is? It's very possible. It is, right? It's a little too close. Yeah. Somebody wrote in healing John Stewart of his Trump derangement, so drum. There you go. Oh that's what it was. So that would make me feel better than random computer image of sickly man on bed that could use divine light. Yes. You know the worst part about the whole thing is he was laying his hands on my head. His little Trumpy hands. Yeah, so small. That's not. I didn't need that aspect of it. And I love the people that I'm surrounded by on the bed. Like the lady. I hope he's okay. He's so low on vitamin D. I hope he's okay. I really couldn't believe how busy that image was. It was like Lisa Frank from MAGA. There's just like so much chaos. So surprising. His taste is normally not, not garish in that. It's minimalist. It literally is, have you seen, by the way, a wonderful thing to do. Somebody should do a time lapse of the oval office since he's been in there. Because he keeps like at a certain point, it's just going to look like my grandma's apartment in Brooklyn. Like there's just going to be Chachkas that she fucking won on the boardwalk at Coney Island. And like a little jar of butter scotch candies. I'd take the butter scotch. Oh, it's, we, she lived, they lived above a candy store in Bensonhurk and you'd walk in a apartment and it was just like, are you opening up a vintage shop? Like, what are we, what are we doing in here? That sounds cosier than the oval office. So, yeah, it sounds like a mind palace. I like it. It was cosy and also slanted. So when you walked on it, you literally looked like, you felt like you were walking and you were just going to go right out the window. Last one, Brittany. Last one. Alrighty. John, has anyone interesting slid into your DMs? That's a great question. I don't know. Yeah. We talked about this before. I don't know what that is. So, so there are interesting people have commented. Like Jack White. I put up the drum set and Jack White. That's awesome. Or whoever runs, whoever runs Jack White's thing was like, cool setup, man. And I was like, obviously no chill. Like, come by any time. Let's play drums. So that was like ridiculous. So you read the comments. Oh, you got to read the comments. Which we've told you not to do. But yeah, I would especially say after the crypto episode, maybe take a break from reading the comments. You have to read it. Let me tell you why. Why should I feel good about myself? Why should an I spend a little time having people beat the shit out of me with their own commentary? But the DMs I don't know. I'm tempted to ask you to open them right now and like read the first one. Okay. You see where it says requests on the right hand side? Oh yeah. Hit that baby. I have 10 of them. That's all. Let's see. Oh, okay. It's, oh, all right. Ah. Ah. Oh my gosh. No. I am never doing that again. That is for sure. Oh, yes. Oh no. Okay. Are you all right? No. I've been scarred. You need to be healed by Trump. Yeah. I feel like one of those things where like it's the end of Raiders and I opened up the arc of the covenant and just like, ah. I'm so sorry. Oh, that is correct. Well, how, Brittany, how do they get in touch with us? Not your DMs. Thanks. That's, all right. Twitter, we are Weekly ShowPod. Instagram, Threads, Tiktok, Blue Sky. We are Weekly ShowPodcast and you can like, subscribe, and comment on our YouTube channel, the Weekly Show, a John Stewart. Fabulous, fabulous job. Everybody fascinating episode, as always, thanks to our fabulous staff and crew lead producer Lauren Walker, producer, Brittany Mimetic, producer, Jillian Spear, video editor and engineer, Rob Vittolo, audio editor and engineer Nicole Boyce, and our executive producer is Chris McShane, Katie Gray. All right. We will see you guys next week. The Weekly Show with John Stewart is a comedy central podcast is produced by Paramount Audio and Bus Boy Productions. [MUSIC PLAYING] Paramount Podcasts.