Unchained

In this episode of Unchained, Peter Van Valkenburgh, director of research at Coin Center, explains why the IRS's proposed broker rule for tax reporting in crypto could harm the crypto industry as well as the security and privacy of users. He explains how Coin Center thinks the IRS should accomplish its aims, and why that would even work for collecting taxes on DeFi gains.  Additionally, Peter explains why he believes the Bank Secrecy Act might be unconstitutional and how that could potentially affect developers building in crypto.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. Show highlights: What the IRS's proposed broker rule entails for crypto tax reporting and why this could have a negative impact on the industry What responsibilities brokers in the crypto space now face Why the IRS didn’t use Congress's amended language from the infrastructure bill Why Peter argues that the IRS’s new proposed broker rule on crypto is unconstitutional and the principles at stake The alternative approaches Peter suggests the IRS could adopt for more effective and fair regulation Why Peter has concerns for crypto developers about the potential application of the Bank Secrecy Act What actions Coin Center is undertaking to advocate for changes in the Bank Secrecy Act to better align with crypto realities Why Coin Center is appealing in its lawsuit against the Treasury Department over the OFAC sanctions on Tornado Cash Thank you to our sponsors! Arbitrum Foundation Popcorn Network Guest Peter Van Valkenburgh, director of research at Coin Center Previous appearances on Unchained:  Why the SEC Is Probing Yuga Labs and Coin Center Is Suing Treasury How Coin Center Is Helping Define The 'Big Fuzzy Gray Area' Of Blockchain And Cryptocurrency Law Why the SEC's Proposed Rules Affecting DeFi Could Violate the First Amendment Links IRS Crypto Regulation Coin Center: Electronic Cash, Decentralized Exchange, and the Constitution The Blockchain Association’s letter opposing tax regulations proposed by the IRS CoinDesk: How the Crypto Industry Responded to the IRS Proposed Broker Rule Patriot Act  California Bankers Assn. v. Shultz Bank Secrecy Act Coin Center: Broad, Ambiguous, or Delegated: Constitutional Infirmities of the Bank Secrecy Act Tornado Cash Coin Center: U.S. Treasury sanction of privacy tools places sweeping restrictions on all Americans Coin Center is suing OFAC over its Tornado Cash sanction Denial of Coin Center’s motion in its case against the US Treasury over OFAC sanctions Learn more about your ad choices. Visit megaphone.fm/adchoices

17 Nov 202340min

The recent Wall Street Journal article that claimed Hamas raised $130 million via cryptocurrency has sparked considerable debate, especially after Sen. Elizabeth Warren used it as her sole source to ask for tighter regulations around crypto. However, the veracity of this claim has come under scrutiny.  Yaya Fanusie, Jessi Brooks, and Andrew Fierman delve into the veracity of reported figures, the methodology behind them, and the subsequent industry responses that sought to correct the public record. They examine the political implications of cryptocurrency, its use in funding organizations, and the nuanced role of stablecoins in this digital economy. Additionally, they address the broader challenges in regulating crypto to prevent illicit funding, emphasizing the need for factual accuracy and a comprehensive approach to understanding and tackling such complex issues.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. Show highlights: how the Wall Street Journal article claimed that Hamas and other militant groups in Palestine raised $130 million via crypto why Yaya, who spent some time in his career doing research on terrorist financing, found those numbers odd why Jessi believes that there's been a loss of focus on facts and accuracy Andrew's explanation of the post by Chainalysis that corrected the record why it's so difficult to make a confident assessment of how much money is being funneled to terrorist groups whether crypto has become politicized  why is it so important to focus not only on the crypto fundraising but also the other avenues, according to Jessi the role of USDT and other stablecoins in fundraising terrorist organizations how North Korea is a much more sophisticated actor than Hamas in its know-how about crypto how the government has tried to respond to the illicit usage of crypto, such as the OFAC sanctions on Tornado cash the challenges to creating regulations to prevent the use of illicit activity in crypto Thank you to our sponsors! Crypto.com LayerZero Popcorn Network Guests: Yaya Fanusie, Director of anti-money laundering and cyber risk at the Crypto Council for Innovation Previous appearance on Unchained: How Widespread Is Money Laundering in Crypto? Hamas has been experimenting with crypto for years: Yaya Fanusie, appearance on FOX Business Jessi Brooks, CCO and Legal Officer at Ribbit Capital Previous appearance on Unchained: How This DOJ Strike Force Hunts Down Cryptocurrency Criminals Andrew Fierman, Head of Sanctions Strategy at Chainalysis  Links Fundraising report and corrections: WSJ:  Hamas Militants Behind Israel Attack Raised Millions in Crypto Cryptocurrency Feeds Hamas’s Terrorism Questioning Two Senators on Crypto Terrorism Washington Post:  U.S. to warn crypto firms against financing Hamas, terror groups  U.S. Cyber Command helps prosecutors seize stolen cryptocurrency traced to illicit N. Korea nuclear weapons program FT: Israel orders freeze on crypto accounts in bid to block funding for Hamas Fortune: Stricter verification laws in the U.S. won’t stop international terrorists from using crypto DOJ: Global Disruption of Three Terror Finance Cyber-Enabled Campaigns Elliptic:  Setting the record straight on crypto crowdfunding by Hamas How Hamas has utilized crypto, and what may be coming Chainalysis:  Cryptocurrency and Terrorism Financing: Correcting the Record DOJ Takedowns Terrorism Financing with Blockchain Analysis Learn more about your ad choices. Visit megaphone.fm/adchoices

14 Nov 20231h 11min

Welcome to The Chopping Block – where crypto insiders Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner chop it up about the latest news. This week, the gang welcomes Republican presidential candidate Vivek Ramaswamy, who discusses his mission to end the U.S. government’s regulatory overreach of the crypto industry, the parallels between crypto and the biotech industry where he came from, whether “code is law” is an appropriate framework for crypto regulation, how Bitcoin could be a check on the Fed, and how less regulation would actually lead to fewer, not more, instances of fraud like FTX.   Ramaswamy is promising to release a comprehensive crypto policy plan this week.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform. Show highlights:  what Vivek thinks about crypto and why he is interested in this topic as a presidential candidate why he believes the SEC is engaging in “unconstitutional overreach” when it comes to crypto what the similarities are between early-stage biotech and early-stage crypto investing whether current regulatory requirements create a "false blanket of security" how Vivek would act to make sure the SEC doesn't overreach how the system should respond to less regulation in terms of fraud and innovation how stablecoins can reinforce the value of the dollar and Bitcoin can help discipline the Fed, according to Vivek whether Bitcoin is an asset that the Fed should buy for its balance sheet why Vivek believes it was a mistake to abandon the gold standard in the 1970s the gang's debrief of the conversation: what stood out, where they agree or disagree with Vivek their reaction to the conviction of Sam Bankman-Fried Hosts Haseeb Qureshi, managing partner at Dragonfly  Robert Leshner, founder of Compound Tom Schmidt, general partner at Dragonfly  Tarun Chitra, managing partner at Robot Ventures Disclosures Guest Vivek Ramaswamy, American entrepreneur and U.S. presidential candidate Links Fox Business: Ramaswamy woos pro-crypto voters, says he’ll build new policy framework for digital assets Axios: Ramaswamy goes after regulators at crypto event CoinDesk: Vivek Ramaswamy Is Drafting a 'Crypto Policy Framework' WSJ: Stablecoins Can Keep the Dollar the World’s Reserve Currency Decrypt: What Stops the Fed From Buying Up Bitcoin? Forbes: What Happened In 1971? Unchained: SBF Trial, Day 18: Sam Bankman-Fried Found Guilty on All 7 Counts in Swift Verdict Learn more about your ad choices. Visit megaphone.fm/adchoices

13 Nov 202348min

Last week, OpenSea, the former frontrunner in the NFT marketplace, confirmed the layoff of half its workforce as the NFT markets seemed to bottom out.  gmoney, NFT collector and founder of 9dcc, joins Unchained to provide insight into the once-dominant NFT marketplace’s fall from grace. He talks about the competitive dynamics that challenge the platform's market share and whether a token launch could help. In addition, gmoney delves into why the NFT market has been “abysmal,” what could potentially catalyze its revival, and how he thinks creator royalties will evolve.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. Show highlights: whether OpenSea 'rested on their laurels' after becoming the market leader whether the fact that its competitor Blur launched a token was a reason for OpenSea's fall whether OpenSea not immediately following other platforms such as Blur in making creator royalties optional led to some of its decline how gmoney wants to incentivize people to pay creator royalties  why the NFT market has gone down and what gmoney's thesis for NFTs is what catalysts could cause the next NFT bull run, according to gmoney how NFTs make it possible for certain groups to access new forms of credit  whether Ethereum can be displaced from its leadership position in the NFT market what gmoney thinks could revive OpenSea’s prospects Whether Blur's model is to blame for the decline in the NFT market how gmoney thinks Blur should act to retain its market dominance Thank you to our sponsors! Crypto.com Arbitrum Foundation Phemex Popcorn Network Guest gmoney, NFT collector and founder of 9dcc Links Previous episodes of Unchained and The Chopping Block debating NFT Royalties: The Chopping Block: Did Blur Cause a Decline in the NFT Market? The Chopping Block: Two on Two Debate: NFT Royalty Throwdown! Are NFT Royalties the Way? How to Build a Sustainable Creator Economy Decrypt:  Did Blur Really Crash the NFT Market? OpenSea’s move to make creator royalties optional for NFT trades Blur Overtakes OpenSea as Ethereum NFT Trading Skyrockets The Crypto Times: Blur Jumps Nearly 30% Within Days While OpenSea Layoffs Cointelegraph: OpenSea lays off 50% of staff with severance in preparation for version 2.0 launch CoinDesk: NFT Lending Platform Blend Sparks Concerns Over Ecosystem Liquidity The Information: Coatue Cuts Value of OpenSea Stake by 90% as Fund’s Returns Sag Axios: The fight over a shrinking NFT market as marketplaces foresee next big boom  Learn more about your ad choices. Visit megaphone.fm/adchoices

10 Nov 202343min

Welcome to The Chopping Block – where crypto insiders Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner chop it up about the latest news. This week, they explore the enigmatic 'unhinged scale' metric, consider whether recent layoffs could have been anticipated, and examine the challenges facing the NFT market. They also provide a somewhat critical look at the events of the recent BAYC Apefest and share their takeaways on how Solana survived the Sam Bankman-Fried and FTX fiasco.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform. Show highlights:  What the unhinged scale metric is and why SBF ranks the highest in that metric Whether the companies doing layoffs could have predicted the market moves in a better way Whether people and the press are being too harsh on the companies reducing their workforce How the NFT market is a much harder environment than everything else, given the extreme volatility Whether the model used by Blur caused the value of NFTs to go down What’s more important in the NFT market: the supply or the demand The BAYC ‘Apefest’ that caused eye damage to some participants and whether someone sabotaged the meetup Tarun’s takeaways from the recent Solana conference in Amsterdam Whether the people who survived the Solana market crash are like ‘cockroaches after a explosion’ Why Haseeb believes that Solana represents the most incredible story in the history of Layer 1s Whether crypto gaming studios should focus on building ‘dumber’ games rather than AAA ones Why “nature is a Ponzi scheme,” according to Tarun Hosts Haseeb Qureshi, managing partner at Dragonfly  Robert Leshner, founder of Compound Tom Schmidt, general partner at Dragonfly  Tarun Chitra, managing partner at Robot Ventures Disclosures Links Previous episodes of Unchained and The Chopping Block debating NFT Royalties: The Chopping Block: Two on Two Debate: NFT Royalty Throwdown! Are NFT Royalties the Way? How to Build a Sustainable Creator Economy Decrypt:  Ava Labs Confirms Layoffs, Affecting 12% of Avalanche Studio's Employees Did Blur Really Crash the NFT Market? Cryptotimes.io: Blur Jumps Nearly 30% Within Days While OpenSea Layoffs Cointelegraph: OpenSea lays off 50% of staff with severance in preparation for version 2.0 launch Learn more about your ad choices. Visit megaphone.fm/adchoices

9 Nov 20231h 6min

In this episode of Unchained, Laura does a detailed unpacking of the historic Sam Bankman-Fried trial and verdict with defense lawyer Sam Enzer and former Southern District of New York prosecutor Rich Cooper. They discuss what a thorough job the government did in presenting its case, whether the government will pursue a second trial on campaign finance charges, why it takes so long for sentencing to occur, what the differences between this case and the Bernie Madoff case are, and what Bankman-Fried’s likely sentence will be.  Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. Show highlights: how the cross-examination of SBF showed to the jury that he was unreliable, according to Rich why the charge conference with the jury is important to the prosecution for “protecting the record” why the closing argument of the prosecutors was so effective  what “conscious avoidance” is and how the prosecutors tried to prove that SBF was guilty of that why SBF’s tweet last November that "FTX is fine" was the hardest part of the trial for the defense, according to Enzer why Enzer wasn’t surprised by how quickly the jury made its decision  what SBF’s strongest argument is for an appeal why Enzer "hopes" that there won't be a second trial against SBF and whether he will plead guilty to the additional charges why the sentencing occurs so many months after the verdict how this case is similar, but also different, from the Bernie Madoff case how many years SBF could spend in prison, according to Enzer and Cooper when cooperating witnesses such as Caroline Ellison, Nishad Singh, and Gary Wang are likely to get sentenced Thank you to our sponsors! Crypto.com LayerZero Popcorn Network Guest: Sam Enzer, partner at Cahill Gordon & Reindel. Previous appearances on Unchained:  Why SBF's Testimony So Far Has Likely Already Doomed Him Another Bad Week for Sam Bankman-Fried in His Criminal Trial Why These Lawyers Say It's Over for SBF-But His Only Hail Mary Is to Testify SBF Trial: How Sam Bankman-Fried’s Lawyers Might Try and Win His Case SBF’s Lawyers Could Be Annoying the Judge. How Might That Impact the Trial? Rich Cooper, Former SDNY prosecutor Links Previous coverage by Unchained on the trial of Sam Bankman-Fried: How Heated Sidebars During the SBF Trial Could Impact the Jury’s Decision SBF Trial, Day 1: Possible Witnesses Include FTX Insiders, Big Names in Crypto, and SBF’s Family SBF Trial, Day 2: DOJ Says Sam Bankman-Fried ‘Lied’ While Defense Claims His Actions Were ‘Reasonable’ SBF Trial, Day 3: Why a True Believer in FTX Flipped Once He Learned One Fact SBF Trial, Day 4: SBF’s Lawyers Annoy Judge Kaplan, While Wang Reveals Alameda’s Special Privileges Sam Bankman-Fried Trial: Here's Everything That Happened So Far SBF Trial, Day 5: SBF's Defense Finally Found Its Legs, But Can It Counter Caroline Ellison? Visit www.unchainedcrypto.com for more! Learn more about your ad choices. Visit megaphone.fm/adchoices

7 Nov 20231h 23min

Two Genesis creditors, BJ and Branden, who prefer to use pseudonyms for security reasons, spoke with Unchained about the alleged fraud by the crypto lender and its parent company, Digital Currency Group (DCG). The discussion is one of the first times Genesis creditors have spoken with a media organization about the situation.   BJ and Branden explain how they gave more loans to Genesis after it took a $1.1 billion hit from the liquidation of Three Arrows Capital and how they then came to be members of the ad hoc group, a collective of Genesis customers who came together to try and save the company from bankruptcy.   They talk about how they now want DCG to pay back the $1.1 billion it owes over a shorter timeframe and to pay back any Bitcoin in actual Bitcoin. The discussion with Unchained followed shortly after New York Attorney General Letitia James filed a lawsuit against Genesis, along with its parent company Digital Currency Group, and Gemini Trust. Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform. Show highlights: what NYAG Letitia James alleged in the lawsuit against Gemini, DCG, and Genesis how BJ and Branden became creditors of Genesis, including the role of the influence of MicroStrategy's Michael Saylor how Genesis claimed it got into what it called a “liquidity mismatch” how, after the Three Arrows Capital collapse, BJ and Branden were reassured that Genesis had "no issues" and "was back to business" whether the trading and lending units of Genesis were all part of the same company and why that distinction is important what the difference is between the ad hoc group and an unsecured creditors committee what the creditors are proposing in order to get their assets back why the creditors want to be paid in crypto, not in USD whether the case will go to litigation and what Silbert can do to avoid it   Thank you to our sponsors! Crypto.com Arbitrum Foundation Phemex Popcorn Network Guests: Branden, Creditor of Genesis BJ, Creditor of Genesis Links Previous coverage of Unchained on Genesis and DCG: ​​Genesis May Be Facing Bankruptcy. Could It Take DCG Down With It? Gemini vs. DCG Is Heating Up. Could Gemini Force Genesis Into Bankruptcy? $630M Due Next Week: Is DCG at Default Risk? NYAG Lawsuit Unchained: NY Attorney General Sues Crypto Firms Gemini, Genesis, and DCG for Over $1 Billion Fraud The Block: DCG says it was 'blind sided' by NYAG suit in third quarter shareholder letter Genesis, Gemini, DCG disputes Unchained: Gemini Says DCG Missed $630 Million Payment Last Week Cameron Winklevoss Threatens to Sue DCG and Barry Silbert Over Delays in Genesis Resolution DCG Calls Gemini Lawsuit a ‘Publicity Stunt’ From Cameron Winklevoss DCG Calls Gemini’s Complaint a PR Campaign in Motion to Dismiss Lawsuit FTX and Genesis Reach $175 Million Settlement, Resolving Complex Dispute DCG and Genesis Reach In-Principle Deal With Creditors Gemini and Genesis Creditor Groups Object to In-Principle Deal to Resolve Bankruptcy Genesis Winds Down its US Spot Crypto Trading Operation Genesis Sues Parent Company DCG, Seeks Repayment of $600 Million DCG Proposes Remuneration Plan That Could Enable Gemini Earn Users to Be Made Whole Genesis Winds Down All Crypto Trading Services: Report Gemini Pushes Back on DCG’s Remuneration Proposal, Calling it an ‘Attempt to Bait’ Earn Users   Learn more about your ad choices. Visit megaphone.fm/adchoices

4 Nov 20231h 28min

The downfall of former FTX CEO Sam Bankman-Fried from king of the crypto world to crypto scammer is complete. A Manhattan jury of nine women and three men took less than five hours Thursday afternoon, day 18 of the high-profile trial, to convict Bankman-Fried on seven counts of fraud and conspiracy for stealing billions of dollars of his customers’ assets.  “Sam Bankman-Fried perpetrated one of the biggest financial frauds in American history, a multi-million scheme designed to make him the king of crypto,” said Damian Williams, U.S. attorney for the Southern District of New York in remarks following the verdict. The guilty verdict came a year to the day after crypto publication CoinDesk published a story showing balance sheet irregularities at Bankman-Fried’s investment company, Alameda Research, that suggested the ties between Alameda and FTX were unusually close. Bankman-Fried now faces potentially decades in prison. Sentencing is scheduled for March 28. After listening to Judge Lewis Kaplan read through 60 pages of instructions, jurors quickly concluded that Bankman-Fried was responsible for decisions that led to an $8 billion hole in its balance sheet, including the use of customer assets for political donations, investments and his own personal use. Prosecutors had reiterated this theme in a stinging, Thursday morning rebuttal.  And jurors rejected whole-hog Bankman-Fried’s defense team’s narrative that Bankman-Fried was being villainized for being a poor manager who didn’t create sufficient risk management systems. They also did not buy into Bankman-Fried’s claim that he was unaware of the severity of his company’s financial problems and that his inner circle, three of whom testified earlier in the trial as part of plea agreements, were to blame.  “We respect the jury’s decision,” said Bankman-Fried’s lead attorney, Mark Cohen. But we are very disappointed with the result. Mr. Bankman-Fried maintains his innocence and will continue to fight the charges against him.” U.S. attorney Wiliams called Bankman-Fried’s crimes “ fraud” as “old as time,” and said his office had “no patience for it.”  He added: “This case moved at lightning speed, that was a choice, not a coincidence.” Catch up on Unchained’s previous coverage:  SBF Trial, Day 1: Possible Witnesses Include FTX Insiders, Big Names in Crypto, and SBF’s Family SBF Trial, Day 2: DOJ Says Sam Bankman-Fried ‘Lied’ While Defense Claims His Actions Were ‘Reasonable’ SBF Trial, Day 3: Why a True Believer in FTX Flipped Once He Learned One Fact SBF Trial, Day 4: SBF’s Lawyers Annoy Judge Kaplan, While Wang Reveals Alameda’s Special Privileges SBF Trial, Day 5: SBF's Defense Finally Found Its Legs, But Can It Counter Caroline Ellison? SBF Trial, Day 6: Caroline Ellison Recalls 'The Worst Week of My Life' SBF Trial, Day 7: In SBF Trial, Did the Defense Lose Its Opportunity With the Star Witness? SBF Trial, Day 8: Former BlockFi CEO Adds Credibility to Fraud Charges SBF Trial, Day 9: Nishad Singh Describes Former FTX CEO as a Bully and Big Spender SBF Trial, Day 10: Defense Struggles to Discredit Nishad Singh's Testimony SBF Trial, Day 11: How Alameda Got FTX Into a $9 Billion Hole SBF Trial, Day 12: Former FTX General Counsel Speaks Out Against SBF Did Sam Bankman-Fried Have Intent to Defraud FTX Investors? Why These Lawyers Say It's Over for SBF-But His Only Hail Mary Is to Testify Here’s How Sam Bankman-Fried’s High-Stakes Trial Could Play Out SBF Trial: How Sam Bankman-Fried’s Lawyers Might Try and Win His Case The High-Stakes Trial of Sam Bankman-Fried Begins: What to Expect Learn more about your ad choices. Visit megaphone.fm/adchoices

3 Nov 20235min