🧵 on the new RWA narrative that seems to be catching fire in a way that security tokens never did. I believe in tokenization of real world assets as an endgame for crypto as financial market infra. As someone who was entrenched in the early enterprise blockchain/DLT projects 1/ there’s a deep frustration on how crypto seems so willing to adopt the narrative w/out raising any flags. We’re back to pumping fast security horses as innovation instead of how crypto cars are a new type of security asset. 2/

There’s this new school of thought that think crypto has a vested interest in portraying SBF as the Mai nefarious villain in this bubble, that’s just not true
FTX’s cancerous operation lifts the veil of the mutated crypto regulatory reality that’s been morphed by regulations. That applies equally to the Celsius fraud & even 3AC. What do I mean?
The origin of crypto perils go back to 2 major decisions in how the financial system deals with companies & individuals who participate in crypto /

I think crypto Twitter is underestimating how much normies are using the FTX collapse & the bear market to justify the presumption that all of crypto was always just one big ponzi.
Truth was crypto was always at the very extreme of risk-on assets with its own derivative market The very nature of having an open censorless chain has lowered the moats for ponzis & rugs, while no one prosecuted the real serial scammers in the space of the ones that went big on one ponzi (Luna, FTX) the truth is crypto wasn’t any more of a bubble than SPACs or memestocks

I chose violence!
Tell me you haven’t bothered to do any actual research into custody tech your tradfi fund uses or crypto market infra or crypto policy, but fomoed into the crypto hype a la Helium.
Bill Ackman knows this shit is wrong, but seems to be promoting post FTX policy

https://twitter.com/BillAckman/status/1599611889675141121

So let’s start at the status quo. In current tradfi, institutions & retail store assets through institutions with a custodian policy. Which essentially means custody solutions BNY/NorthernTrust have bought from vendors like Thales.
Ironically the BNY clearing & custody is called?

Read!
Vitalik’s expansion of the proof-of-reserve concept into ZKp schemes for:
- Proof of on-chain assets
- Proof of liabilities (collateral pledged)
This still leaves 2 gaping ommisions:
- proof of fiat assets
- proof of dual pledged collateral
hackmd.io/@vbuterin/proo… The first (proof of fiat assets) demands trusting an off chain attestation of the account.
The latter can be solved, were all lending platforms to commit to issuing their own proof-of-collateral onto the chain, so that dual pledge of an asset can be diverted from that. /

🧵Let’s imagine how this week would have unfolded if @SenStabenow DCCPA proposal had been the law of the land in order to judge if this is the best path forward:
1. FTX would have started the week as an off shore crypto exchange trading shitcoin & perps
/ 2. The FTT token would still be around, as issued by FTX with no proper disclosures as to who holds it on their books or where it’s been collateralized
3. Almadea would still be market making for FTX as an off shore entity with no Chinese walls between SBF conflict in law

🚩🚩Time to sound the alarm.
If legislators are gonna rush a bill to crack down on crypto intermediaries along the lines of what existing legislative proposals, it’s gonna end up as a wrong move on top of incompetent regulations to kill what’s left theblock.co/post/185473/ur… Recap: the proposals as they pertain to crypto so far have focused mainly on stablecoins & crypto intermediaries within the US, looking to align their businesses within the existing securities/commodities frameworks. That implies tougher moats for any IS based businesses, /

Everyone is assuming FTX needs about $6B to be solvent, that's not necessarily true. Imagine a big player or 2, come in & guarantee half on the capital needed & then offer a new "creditor token" with a discount to FTX clients...as a secuity 1. regulators will be happy - full KYC/DD to the off-shore FTX clients'
2. It creates a new form for exchange token, similar to that of the Bitfinex LEO, only this time they raise capital as a senior creditor from the public & clients'

Given the prominent names on the FTX cap table, maybe it's time to scrutinize the established funds who derelicted their fiduciary duty for DD or governance in the race to get their names in on the SBF brand? The VC world is slowly acknowledging the age of cash with no governance is over. It may have started with Yuri Milner getting in on FB in return for no board seat, but in crypto it was worse cuz there's almost no boards, mostly tokens.

The slow boiling crypto contagion domino zoomed out:
1. Q1 ‘22 crypto markets drop by 20% from ATH along with equity markets due to inflation
2. May - Luna ran a perpetual motion flywheel till the peg of stablecoin broke, bringing down the entire Terra/Luna ecosystem Luna wiped out $60B of investor money, but initially some crypto incumbents (Jump; Celsius) were willing to step in to backstop their peg. As they realized the vast debt needed, they dropped their offers

All the Israeli so called US politics experts who flew into Philly last night getting briefed by the Shapiro/Fetterman campaign & proving they know nothing about how the DNC/RNC/unions/PACs work.
These ppl never be tired out of cities to realize Appalachia looks like Gaza Only more spread out & no high rises or drones

Some thoughts on the new Atom whitepaper:
1. It's pretty clear the IBC/Atom ecosystem has been one of the more progressice chain communities since the get go, despite the original tokenomic not leading to direct Atom appreciation.
gateway.pinata.cloud/ipfs/QmWXkzM74… As such the desire to create an on-chain treasury fund from aggregated fees fits to that philosophy, over the crypto conventional play for an ecosystem fund earmarked by VC funds, seems on-point to the nature of Cosmos.

The irony that crypto was lauded for years as a technology to rectify a lot of the credit mistakes that spiraled out of the GFC (subprime MBS), only to to replicate the same structures in crypt based lending & funds, was almost preordained. DeFi started off with MKR/Compound as an on-chain overcollateralized protocol to charge liquidity in USD to projects holding treasuries in ETH, but was swiftly followed by centralized alternatives who sourced yield for crypt based lending from the GBTC premium

כללים להבין את התפטרות בוריס בזוית ישראלית;
1. נניח ומקורב לראה״מ היה מעורב בפרשת הטרדות מיניות חוזרות וראה״מ ואנשיו היו משקרים ומכחישים זאת. נניח שרי הליכוד היו חוטפים בסקרים על שנתפסו משקרים שוב ושוב בהגנה על ביבי ולשכתו בנושא נתן אשל. 2. נניח הציבור ניה מואס בשקרי הליכוד ובחבורה שנתפסת בפלילים (שחיטות, עבירות מס, מתנות) ומגנה על כך בבריונות ושקרים מתמידים.
3. אילו הציבור הנה מעניש את הליכוד בבחירות מקומיות ובסקרים
4. נניח וביבי היה מאבד את התמיכה של רב סיעת הליכוד בכנסת מחשש שיאבדו את מקומם בבחירות מקומיות

What instiutions were to the last cycle, corporations will be to bear market & merge.
Over the last week Cloudflare& Google Cloud are spinning units focus on blockchain infra. Presumably both will make use of their global data centers to offer node network services for staking As an industry node networks evolved to either be infra providers acquired by exchanges who needed a plug into various protocols or centralized service offerings like Lido.
How crypto IaaS stacks up is crucial in understanding the de/centralization path for base layers

Big!!
Not bullish exactly but this might be the first big innovation Coinbase has come out with for onboarding users directly onto Dapps & interacting with smart contracts.

https://twitter.com/tier10k/status/1526300514509545473

The implications might be that the next wave of new users could be permanently custodial based with an exchange tracking their transactions & taxes.
Reverts the question of KYC only / regulate pools & protocols back to devs, who can gate keep it to exchange based users

Maybe we got the web monetization mode wrong. Projects can’t subsidize ownership if once the fumes dries out, users abandon ship.
PMF means users stick around in a down market not just for speculation. I think the “ownership narrative” needs to change to attract retail users back. Initially the premise was that owning an asset means users don’t need a custodian, not that they have to own everything to use web3

A bank run on a centralized stablecoin can actually be a lot more dangerous & spread toxic risk into tradfi.
The Terra collapse was self sustained within crypto markets & didn’t pose any serious risk to financial stability, due to the fact no fiat assets were redeemed. But a centralized stablecoin, much like a money market fund, in a bank run needs to sell all its’ reserves into the open market to make good on its’ obligations.
That’s not a major concern when said stablecoin is small (billions), but when a trillion t-bonds are sold at once,

The seminal question looking forward after we all take the weekend to chill lost Luna - are we looking at ‘18 bear market or ‘21 summer season?
Gut is that this time is different:
1. Crypto isn’t an unknown to Wall Street, institutional or normies. It’s not alien to them anymore Meaning they know the risks, clickbaits, celeb shill & jokes. They’ve made their own minds whether to trade/hold & there isn’t a new wave coming in on the horizon
2. Equity correlation - crypto has ceased to be an uncorrelated asset class & has traded in line with tech stocks

Some open ended question post Luna debacle:
1. Was it coordinated attack or uncoordinated slippage due to4pool?
2. Have we seen the end of the second order effects or are there more to come? Risks I’m looking at (Celsius/blockfi, StEth, liquidations, stablecoin decreases) 3. Yield drought (farms are inherently long gamma, yet the market has lost more than half of the crypto market cap since November)
4. Oracle/bridge attacks emerging as new security assumptions are tested with liquidity
5. Alt L1 non incentivized trades in a down market

Let’s talk disclosures - Galaxy as a public company has a legal obligation to notify investors as to any significant change in their balance sheet & profit expectations.
TFL doesn’t! Which is why we still don’t know what happened to their BTC holdings / bloomberg.com/news/articles/… But their disappearance act over the last week hasn’t dissuaded them from offering a new revival plan that resets the balance.
They have no legal obligation to share with the community/Luna/UST holders the exact info

agora.terra.money/t/terra-ecosys…