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Episode Transcript
[00:00:01] Speaker A: Welcome to Crypto Talk radio, the podcast for everyday investors like you. Visit us on the [email protected]. And now here's your host, Leister.
[00:00:13] Speaker B: Thank you for that, Bailey, and welcome everybody out there in crypto Talk radio [email protected] I am actually recording this in the middle of waiting for a delivery show up. I don't know how long this lady is going to take to get the delivery done, and usually my episode is about 2030 minutes and hopefully she's going to be sooner than that. But apparently she's doing multiple deliveries, which I can't stand. And by the way, welcome or welcome back to Cryptotalkradio. Net. My name is Leister. I am your host, and I am tussling with another minor oral issue. So if I sound strange, that would be why, sounds bad as it was the other time, but it's bad. What happens is the humidity just kind of goes wherever it feels like going and it tanked down into like the 20s, which is not healthy. Normally it's like forty s. Fifty s. Fifty s is like nirvana, but it's gone to like twenty s, and then that wreaks havoc on my situation. So part of the delivery includes some distilled water that's for my humidifier so I can get back on track. And it's going to take some days for everything to pass. So forgive me, but that's what I'm tussling with. I am doing some different coverage. If you didn't hear you're new doing different coverage, we had a request about covering exchanges, so I'm going to be doing exchanges on pretty much a weekly basis, just kind of going through ones I covered before. And feel free to go back through our [email protected].
I did a pass through a lot of different exchanges, some of which don't exist anymore, and I'm revisiting those now with a second look. And I was going to do a couple that caught that I knew about, and one of them is dead. One of them changed to the point I would never recommend it. So I found a different news bit about one that I didn't expect, and I thought that was good for this episode to talk about that one. Also, I'm starting to intersperse more of the larger economy type of things to be more well rounded because I think as we get closer to the bull run, we expect it's good to have a little bit more coverage than just talking about coins or tokens. So let's go ahead and jump into this and see what we can do, see where we can go on this one.
All right, well, that lady just cost herself a tip anyway. Let's get into cryptocurrency so I can stop thinking about that garbage that just happened. And maybe sometime later I'll rant about this nonsense. Right now it's not really worth it. We're going to go to coindesk.com so we can talk about some things that happen. And first, we're going to start with some numbers, because it didn't seem like the numbers were affected by what happened, although I felt like they should have. They were not zooming out to the bunch chart on ethereum. And we're back up. We've reclaimed some of the level that we lost before with the dip that happened a little bit earlier, which is great. And we're on an uptrend, which is great. Bitcoin has not recovered the full brunt of the run that it had, but it's pretty good. Low of 41 seven, high of 43 three, close to 43 four. So good recovery trending upward. We had some disruptions. I'm going to be talking about, which, as I said, we're going to see these things that kill the business, and you have to be careful. And volatility was expected. And if you've listened to me for a while [email protected]. You know, I do everything I can to try to give you forewarning. If I can anticipate it, sometimes I can't. This was obvious. The volatility was obvious, and I'm tinfoil. I think some of this is strategic. I think some of it's intentional. I think some of it's planned. I can't say for sure. I'm just saying the timing of some of these is a little bit off, man, because right at the crux of a major, major run, and all this garbage happens right at the same time.
What are you talking about, Leister? What garbage now are you talking about? There's a lot of garbage, but specifically, what garbage are you talking about? Well, geez, let me count the ways.
Let's go down the list.
Sushi. Sushi. Defi. The sushi token. The sushi protocol got breached again, second time this year. CTO, his name's Matt, came out and said, please don't use dapps until further notice. This was actually related to something different, which I'll get to in a second. But the sushi breach was significant because it's the second time that this has happened.
Now, the reason that this was affected was not sushi itself, rather the connect kit. So in other words, the code that's used to connect Ledger, which is a hardware wallet. And some time ago on the show, I talked about how these idiots at Ledger, that was the one where they talked about we're going to store your stuff in the cloud. And I said, you guys are freaking idiots, and you know, you're idiots and you're going to cost yourself. And I guarantee you something's going to go bad. Well, something went bad, folks. Not what I expected, but something went bad. So allegedly, I saw some tweets on this, but allegedly bad actors got access to the code, some of the code that drives what's called the connect kit for ledger. I'll come back to that. But the code was hosted on GitHub. GitHub is a publicly available repository for code. And what they did is they took some of the snippets of code and they added injected is the word, their own segment of code that did a drain attack. So then they go to these sites that are perfectly legit sites, but they inject their own malicious code that's now been altered into the framework that prompts you when you connect your wallet, which one of the protocols you want to use, where Ledger is one of them. The difference between something like a wallet connect and the way that ledger connects is that ledger has a lower level of access for its connection because it's hardware.
With any hardware wallet, it doesn't matter which. But with any hardware wallet, there are these default, which is the reason why not every Dapp supports hardware wallets. It's only certain ones.
So unlike wallet connect, it's a lot more ubiquitous, as in widespread, widely available.
So when they make this breach happen, it took two forms. One, it overlaid a custom connect window that looked legit, and when you interacted with this, it actually would drain wallets. So once they identified this was happening, a bunch of messages went on social media warning, people don't interact with Dapps because we see this malicious code that's tied to what we're doing. And because it's dapp centric, it didn't matter if it was ledger specific, it was affecting just the connection to the dapp itself.
When finally tether gets involved and they freeze the wallet for the exploiter because they can do that, stablecoins can do that. And it was a large big thing. This with sushi was directly affected, more so than others because of how much money was going through with it and the direct connection on this, it's been since patched and fixed. But what happened, it was a big issue. It's a big deal because of how you wouldn't have known, like if you looked at the window, you wouldn't have really known that that was a thing because it looked like a legitimate window unless you were in the know about this other window behind the scenes, that looks kind of suspicious. So allegedly it's safe now. But I am going to tell you as just a warning, be on the lookout for things that simply don't look right. If you're connecting your wallet, and I don't care if you're mobile, computer, whatever, if you're connecting your wallet and you see double windows pop up, it's probably not safe. If there's misspellings, it's probably not safe. If they have these banners like recommended or whatever, it may not be safe. Just be careful because they say it's safe, but I don't know, because at the D app level, could be that there's some D apps that didn't patch theirs and you could be at risk. So be careful with that business. So that happened. Over $60 million breached due to this. Actually liquidated, specifically speaking, due to this issue. So when I say it's a major deal, it's a major deal. It's a lot of money that happened on that one. But that's not all. But there's more.
So over $2.7 million then breached from OKX.
OKX is not the exchange I'm going to be talking about today, certainly not since this issue happened. But OKX is a decentralized exchange on the web. It gets breached, caught out by Pexhield. Pexhield sends out the message about what's happening here. And if you're interacting in any way with OKX, it is recommended that you revoke your approval for that to do anything. And you can do Everrevoke, which is everrise.com, and then hit the D app and then there's an ever revoke menu option. I do recommend doing that if you are connected to OKX. I didn't because I didn't think much of it. But just FYI, this has happened. They're reviewing it, they're trying to figure it out and secure further funds and try to reimburse as much as they can, but keep yourself safe because again, this all happened roughly around the same time. And again, the timing, I just. I'm going to Tim, follow. That is what it is.
What happened here was completely different. Allegedly. And I wasn't there, but allegedly, the private key was leaked somehow from one of the admins. When I say admins, I mean the owner. Right? One of the admins. Allegedly, the private key got breached. Now, I don't know how you could have a single private key get breached and you don't have multi sign wallet or something else to centralization, right?
Because OKX has been around for a while. How can you have it where there's a single point of failure is what's referred to in audits and investigation. How can you have that for so long? And then secondary to this, I'm curious about how they were able to get that leak. If it was that that person went to a sketchy site or something else. Well, that should lessen your confidence in their ability to secure your assets, if nothing else. That's why I refuse to talk to them, because if they can't do it for themselves, they're not going to do it for anybody else.
But wait, there's more. Speaking of exchanges, Kucoin recently forced out of New York after settling a lawsuit from the attorney general for $22 million. So they're going to cease operating in New York. What this means is that they're not shutting down as an exchange. They're basically blockading New York citizens. They're settling for $5.3 million and give back a bunch of money because allegedly, Kucoin failed to register on securities and commodities. Now, Kucoin has been one of those exchanges that's been operating just whatever I'm just going to do with. Know, their ky seems kind of lax and it's like here what it is. So this is similar to what happened with Robinhood and Nevada. At a point they changed it, but it was too damn late where they refused to do any sort of transactions. If you lived in Nevada and then at one point they refused to sell Shib in New York, it's just know these state level things is just dumb because I understand what they're trying to do. I'm talking New York, but the whole stovepipe approach is what just drives me nuts because it's whack a mole. It's not solving the problem.
State came out and said, quote, crypto companies should understand that they must play by the same rules as other financial institutions, and my office will hold them accountable when they don't. This settlement will ensure every New Yorker who put their money into Kucoin can get it back, and that Kucoin won't be able to put other New York investors at risk.
Kucoin came out and said, you know what? Your money's safe. Don't worry about it. You're going to need to get out of Kucoin. We're going to send you your money. If you don't do it in time, we'll make sure you get it. We're going to do what they say and just get out of this business. So if you happen to be in New York, and I feel bad for you if you do, but if you happen to live in New York and you were considering Kucoin, you may want to reconsider that. And again, I will talk about Kucoin at some point, because generally speaking, I think it's good for awareness. They're not as egregious as freaking webull, which I'm not going to be covering, but that's an FYI for you. So that's that one. So we have all this turmoil and crazy stuff at the same time that we're starting to go back on another run again. And people call me tin foil. I'll take that. I'll take that. Because, come on, man. The timing is too convenient. Timing is just too logically convenient to happen all at the same time. All around exchanges where likely there will be a lot of heavy trading and transactions happening right around this time. And all of that transactional trading would cause what? Upward trend and possibly fomo run, which contributes to the run up. But then all of a sudden, all this craziness happens at the same damn time, which would do what? Stymie that upward progress. Yeah, you can call me Tim fall. I'll take that. Because I found it rather suspect. That's all I'm saying.
I had another article because it seemed like it was kind of popular. I'll say another article. This is economy related, and it ties to sentiment, so it's not directly crypto related. What I'm doing is not about crypto specifically. These are just things that I wanted to talk about that happen to be related from an economy perspective, and then they may affect cryptocurrency at some level. And I thought it was good to do some of these contextual things every now and then for each episode as I stumble across them.
This is around wages in the United States and the job market and layoff numbers and wage numbers and all of these, they are directly correlated to the performance of cryptocurrency for one main reason. Obviously, if you make less money, you have less discretionary. Less discretionary means you're unlikely to give to cryptocurrency unless you're a gambler. If your money goes up and you get more discretionary, you may try to tangle a cryptocurrency because you're a gambler. Either way, the job market has a direct correlation to the performance of cryptocurrency, similar to what we saw during the pandemic when they were giving money away. The so called quote, stimmy and free money flowing into essentially cryptocurrency may have contributed to some of the bull run activities. Looking at the pay and job market helps us understand what may be coming our way, so I wanted to give a couple of notes. This is an opinion piece, so there's some facts interspersed, but it's essentially an opinion piece.
Quote not much unites the world these days, yet there is one sentiment shared by many people, regardless of nationality, pessimism about the economy. One in ten Americans think they're better off than a year ago, according to a recent poll conducted for the economist by UGov. Similar negativity shows up in surveys elsewhere. Such glumness persists in America, despite the remarkable feat performed by its economy. Workers real wages are significantly higher than before the COVID pandemic. Even after controlling for inflation, those on low incomes have done particularly well, benefiting from tight labor markets. Since 2021, average weekly earnings for the country's workers reached nearly one $100 in October, up around 3% in real terms. Since the end of 2019, the lowest quartile of earders has seen annual average annual nominal pay rises about 5.6% per year since the beginning of 2020, compared with 3.8% for the highest quartile, according to figures compiled by the Federal Reserve bank of Atlanta. Stop.
So let me simplify what this is saying. What it's essentially saying is that by and large, we have a spread of salary levels, low income, middle income high, and the job market has largely kept a pace, it's referred to, with needs of those who need jobs versus jobs available. As a result, the companies will try to entice workers by adjusting the wages upward because they want to entice more people to apply for those jobs if they happen to be low wage jobs. This then correlates to if you're on the lower end of the spectrum, you may be in a better position to negotiate for higher wages. Now if you're listening to me [email protected] saying to yourself, that's a bunch of crap, you'd probably be correct. That's why I said it's an opinion piece.
However, it's talking statistics. It's broad statistics. It's saying overall, this is what we're seeing.
It's called trickle down economics. It may not come down to your level if you are at that level, and it may be situational, it may be certain regions of the country, it may be certain types of jobs. We know that the blue collar generally doesn't pay that well unless it's heavy labor type things. So we know there's all these variables that get in way where it's not necessarily a true statement to say that rhymes, but we have to look at what it means from a statistics perspective. Overall, broad span.
If it's true, and I can't say it is, but if it's true that more money is starting to be available for workers, as it is a general statement, it means that potentially more discretionary income may come the way of cryptocurrency as people want to try to play with some money and gamble a little bit and make something, well, we don't know if that's going to happen. We're saying on the numbers, if that's true, and depending on that scope that I talked about, we might see some of that money flow into cryptocurrency. I talked about the total market cap. Total market cap, as of the last time I looked at it, was $1.65 trillion, which isn't terrible. Absolutely not terrible, but it's certainly not where we want it to be, which is roughly around $2 trillion. So 1.65 trillion, as I record. This is good, but it's not where we want to be. If more money flows in, we can get where we want to be, and that may trigger the run that is truly the bull run that we are anticipating is the point. And we have to look at how salary availability, money availability plays in that. But I think the one differentiator of now versus when Biden took office, when Biden took office, it was at the tail end of all the different programs designed to make more money readily available to the regular worker. So a lot of this, quote, free money stimmies, et cetera, all that's gone. On the business side, it's all gone. And we do have a lot of companies that are still having a difficult time with the idea of remote work. We have colleges that are struggling with students not being able to work from home. They want them on campus. But then there's these outbreaks that happen all over the place. All I'm saying is that we expect, numerically speaking, statistically speaking, that there should be more money coming into cryptocurrency roughly in the first quarter, assuming that the data that's presented in this opinion piece is accurate and fair and correct, and that's the uncertainty, and that's something to think about. And if you weren't thinking about that as it relates to cryptocurrency, my call to action to you is to start thinking about these things. Start thinking about how these external economic factors affect cryptocurrency, because you are going to see money shifts according to whether it's readily available or lesser available. Now, here's the contradiction in all of this.
So this is Trump's reign during the pandemic 2020. We had people that were getting cut from jobs because they refused to stick stuff in their arm. We had businesses that were shutting down. I actually had an endeavor, I gave some updates on this. I had an endeavor that I had signed in March of that year, and they had to cut it just a couple of weeks out because there was a hospital and they started getting patients like crazy. And so the money, they had to basically gut the IT department, not gut the people, but the money that was set aside for it, spend, I should say they had to gut it all. So then, okay, that money is not available. You got people getting cut from jobs. You got people there. It was horrible.
When they started giving free stimmies. Well, the stimmies were nothing. It was like one, $400, $600. It wasn't going to go very far, especially when rents median, they're starting to go up near to 1201, $300.
Yet. We saw a massive influx of money coming in, certainly during 2021, early, I'd say late parts, 2020, but certainly 2021, we saw an influx of money coming in. And 2021 certainly did not have heavy recovery. It is arguable certain of the businesses and institutionals played a factor. I'm saying I didn't see a significant swell from the regular retail side. I saw a lot of institutional money coming in there. And do I think that repeats? I'm not sure. I think this next run is really going to be about retail institutional, certainly, but not to the degree we saw before. That's a call I'm going to make, and I could get it wrong, but that's what I'm going to stand by.
Let's talk about our exchange. And the interesting thing about this exchange is that it's not a centralized exchange. It used to be a centralized exchange. It's no longer a centralized exchange. This was just brought to my attention very recently. Apparently this all took place last week, at least at start points, and I wanted to bring it to light because people may not know. I didn't see a lot of traffic about it. I got to give you some history back in May of this year.
I'll tell you what happened. Ultimately what happened.
It was kind of weird, but ultimately what happened. Hotbit, which was a cryptocurrency exchange, it was actually one of the many that I used at a point, suddenly announced they were shutting down. They claimed that, you know what, it's getting really difficult to conduct business.
They were getting a lot of breaches. They were getting a lot of money flowing out of them. It was hard for them to sustain what they were doing. They got subject to a criminal probe at points, and they said, you know what, we can't handle this smoke. We're done. I can't do this. This is not for us. I got to get out of this. I don't want this.
So they shut down the business. And after this, some smoke dies down.
And it's brought to my attention that then Hotbit is going to come back. But as a decentralized exchange called Hotbit Dex, this is actually a thing right now. If you want to take a look at it, it's test interface is up. It's at hotbit IO, if you want to check it out, and you can even do, I don't necessarily recommend doing this, but if you're a gambler or maybe you have a free empty wallet or something, you can do a connect wallet, and then it gives you a faucet where you can have some test funds and play around with this. They encourage you to do so. But essentially what they're doing is they decide to get out of the centralized exchange business so that they're not in control of the wealth. They'll just basically provide the tools on a dcen side and the ability to do liquidity pools and derivatives exchanges. And as I was looking at it, I was intrigued by the prospect of what it's trying to do, doing derivatives exchanges through the descend side.
It's not unique to them, but very few do that, very few other descends dapps are able to do that. And then it's got the full on graphical experience.
It's almost like Dex tools in a way. When you look at it, it allows longs, it allows shorts, it allows all the different things that a centralized exchange would offer.
The only difference of this one versus what it was doing before is that it does not have custody of the funds. From what I can tell, like visibly, it's very similar to what it had before. Other than the fact that it does not have custody of the money. Well, that takes away the main risk that it had is their custody of the money and being the middleman and Gary Gensler, there's not a lot of tokens on the test right now, so you're not going to see very much significant stuff out there. But just to play around with the web experience that they're trying to do, I do encourage you. Just take a look at it and see what you think. Just make sure you stay safe. Use a throwaway wallet maybe if you're going to kind of play with it, it's test, but you don't know. Like with this whole D app business I just talked about, you just don't know. So I'm recommending if you do want to play around with it, then certainly I would recommend a throwaway wallet. So if they can pull this off. And again, I'm intrigued.
It again offers everything that you might think of doing without the centralized asset control. I didn't see if there's a Kyc, so if there's not a KyC, that would already be a plus.
But it offers referrals, it offers derivatives, it offers staking, it offers liquidity pools and rewards for liquidity pools. It's everything that it did before with the exception of centralized asset management. Everything else and the bots, everything else is, from what I can tell, is basically the same thing. So I am greatly intrigued and I'll keep my eye on it because if they are to pull it off, it might open up the next stage of what descend exchanges can be all about. Because again, very few are pulling it off. Like what I see here, and the test is a thing and you can play and it looks legit to me and it's an organization that's already got kind of that backing. They already had the experience of doing it so they can reuse their existing code, presumably to make this happen. And I was very interested that they were back. And again, this just happened last week that I saw this. So check it out. Hotbit IO if you want to check that out, I do highly recommend that you do so. And then I've got to identify the next exchange, which will probably be Bitmart at this point, as far as I can tell.
Bitmarter, one of the other ones for the next level episode. As I close out, here's the thing.
We're in a unique situation.
There's all sorts of garbage starting to show up. Pepe was a thing and then people moved on. Now there's bonk. And I'm not going to cover bonk because it's just another pump and dump. It's clear.
But I saw that some of these are. They're just getting immediately on the top know, just straight garbage ones. Garbage. They're getting on the top exchanges simply because they had the volume numbers.
And it occurred to me that there's really big rich players that they know how to influence the game. They know that if they toss a crap ton of cash at these things, the finances of the world, the coinbase of the world, they're just going to list it even though they know it's crap. That's exactly what happened with Bonk. Bonk has a hundred, I want to say it's a hundred trillion of supply. It has a crazy amount of supply.
So you do that business, it gets close to 2 billion in volume. And then all of a sudden, okay, well, they're list you. You don't do thing, you don't do shit. You're nothing. You're a piece of garbage pump and dump coin. But they won't list utility tokens that are low volume, but they're strong utility ones. They won't list the ones that actually do something at all.
So I know that the whole exchange listing, it's basically a scam. It's essentially, it's a racket. They're there because they want that profit, the makers and tigger fees. It's not that they want to list the quality ones. It's not that they want to list the good ones. It's not that they want to list the ones that actually are serious investments. They don't. And I can only hope, and I know this won't go over well, but I can only hope that the SEC is able to do something about these because it's getting worse before it gets better. That's just my personal opinion on it. Stay safe out there. If you're going to invest in it, you're a gambler, I celebrate it. But stay safe out there because I wouldn't want to see people get trashed or wrecked by some of this garbage that I'm seeing.
