37: Uh-oh…More Platforms in Trouble. Will Goldman Sachs or FTX Save the Day?

Tracey: [00:00:19] Welcome to the Crypto Curious podcast designed to help you navigate the dynamic world of crypto currency. We're here for anyone who is interested in crypto at all. Maybe you've already dip your toe in the water, or maybe you don't know anything at all. And this is the very beginning. But we recommend hitting back to the very early episodes to get your footing. However, if you think you're ready to dive in headfirst, then let's do it. My name is Tracey and I'm joined by my mates from the Bamboo Blake and Craig. Hey, guys. How you going today? 

Blake: [00:00:48] Pretty well. Tracey, how are you? 

Tracey: [00:00:50] Very well. 

Craig: [00:00:51] Good. Thank you.

Tracey: [00:00:52] Excellent. Good to hear. So we dropped a great interview with RV founder Stephanie Coolidge of This Week, so we hope you guys really enjoyed that one. But what that means, though, is that we've got a couple of weeks worth of really juicy crypto news to catch up on. So one thing we do know is there's never a dull moment in crypto, even in crypto winter. There's always some exciting crypto news that's going on. That is exciting. Is the new season of the boys, in fact, hard to stomach in parts, but too good not to watch. So let's talk about a few things that we thought were interesting over the last two weeks. NFT. New york city is officially over. Blake was there for some of the festivities and from all reports, there were some great parties mixed in with quite a few duds. The Board eight Yacht Club threw a four day festival for the community with performers like Eminem, Lil Wayne and Snoop Dogg. Blue Chip NFT collections did really well over the week, and some of the top ten collections were actually up by around about 25% during the week. So Blake, tell us about the vibe. How was it over there? [00:01:56][64.2]

Blake: [00:01:57] Yeah, now it was really great actually. The conference was around Times Square. It was huge. You know, there were tens, tens of thousands of people there and there were all sorts of events on every day. You know, what really did stick out to me, though, was that there were lots and lots of early stage start ups looking at ways that they could utilise and leverage that technology to build, you know, different sorts of businesses. You're and you're really reminding me of the 2017 Icra boom when you had all these people looking at different ways that they can apply the technology, many of whom unfortunately won't make it through. But it's really important part of the process that, you know, people are innovating and trying to apply the technology to real world use cases. So it was great to be a part of and I could probably touch on a couple of really cool start-ups that I saw that you guys might be interested in. [00:02:52][55.4]

Tracey: [00:02:52] Yeah, definitely. [00:02:53][0.3]

Blake: [00:02:53] Yeah. So there was one guy that I ran into and he does pressing of vinyl music, so he actually presses the vinyls and he's started the process of putting an NFT inside of it through an RFID tag. So when you get your collector's edition vinyl, you're able to scan it and it will bring up information about the artist, how many times it's been traded. Then when you do decide to sell it, if ever down the track, a certain percentage of the proceeds of the sale of the transfer of the NFT will go back to the artist. So I thought that was really interesting. [00:03:33][40.1]

Tracey: [00:03:34] Yeah, that is really cool. [00:03:35][0.8]

Blake: [00:03:35] Sydney Another project called Sugar Glider Digital and it's a Sydney based project and they curate art for corporates. So when you know, a big accounting firm or legal firm or, or a state government wants to do a collection of art in their foyer and they would come in and do that. There's a strong need for digital art as well. So they're looking at ways to turn, you know, fine art and fine digital art into nfts. So then it can be rented by these corporates and a certain percentage of that rent automatically goes back to the creator, which is, I think really cool. [00:04:13][37.7]

Tracey: [00:04:14] Yeah. Well, I think the digital I think the art of space and the NFT is the one that's going to be the next kind of frontier. That's that goes big. Craig, did you at any time, are you going to hit over next year. [00:04:23][9.8]

Craig: [00:04:24] If you guys if Bamby pays for it? Now, if I did get a little bit of time, I actually the coolest announcing that I saw was Pharrell Williams who like is arguably the coolest person yet world he's joining doodles which is an NFT project but Justin Bieber loves actually Bieber. He's on the doodle chain. He's joining them as a chief brand officer. So that's pretty interesting. Like whatever that means and feels like, that's just that's just a fancy title when you do no work. But maybe. [00:04:57][32.4]

Tracey: [00:04:57] Maybe, maybe Pharrell's not as cool as we. He was then. [00:05:00][2.7]

Craig: [00:05:02] Very interesting nonetheless and Goblin Town did well trace from an EV to New York that had the highest growth in floor price, but they also had real life tattoo stations where people were getting Goblin Town tattoos and if you like, want to see what this looks like. It looks horrible. This these ugly. [00:05:21][18.4]

Tracey: [00:05:22] Goblins are horrid. I can't believe people are getting caught up in all this. And yeah. [00:05:25][3.6]

Craig: [00:05:26] So intense. But yeah, people are getting tats. I'm not sure I'd do that for my pudgy penguin, but good on them. [00:05:33][6.6]

Tracey: [00:05:34] Yeah. I was definitely having some fun by watching all the events that took place as well, especially projects like World of Women. I had Madonna come and play there and Beefs, Boss Beauties and all the other kind of female led NFT projects. I've gone really hard with the community spaces that they run through discord with a real emphasis on these real life event meet up. So it was no surprise at all that their events were pretty spectacular and they're offering some of their NFT holders some amazing perks. But I heard also that the board at Yacht Club, I mean, they got a little bit of kickback because it was they couldn't get I think you had to go in the running to go to different events. They couldn't facilitate all the people in one spot. Did you hear anything about that? [00:06:13][39.6]

Blake: [00:06:13] Blake No, but I did hear a few of their parties were not that great in the end. [00:06:17][4.0]

Tracey: [00:06:18] A bit lame. Yeah, I tell you, can't win them all. But moving on, big news. Last week, Craig's crypto coin darling Solana is building a mobile phone. And that's right, this Android phone will have crypto functionality built in and they're hoping to make crypto a little more mobile friendly. The name of this ambitious project is Get This Saga. I find that I find that really odd. So the phone is scheduled to be released in early 2023. It'll cost around $1,000 and can be pre-ordered with a $100 deposit. So, Craig, tell me why you love this news. I love. [00:06:55][36.9]

Blake: [00:06:55] It. It sounds like it's going to be a bit of a saga. [00:06:57][1.7]

Tracey: [00:06:58] I think sounds like a saga to me. [00:06:59][1.5]

Craig: [00:07:00] It was just a lots of A-Z with Solana, but I like it because it's the first time someone's tried it and there's going to be plenty of features like Solana Pay where you can use like an apple pay pay for things decentralised app store people can build dapps on Solana Charlie decentralised zero fees like the app store has. Look, this could flop but look good on them for trying like it's something different. And they talk about this thing called SMS, which is a Solana mobile stack, and that is pretty much a software development kit where they'll incentivise developers 10 million bucks to jump on the App Store and build some cool stuff. So let's see how it goes. But I, I dig it. I think it's gonna be interesting. If it was not Android, I would probably get it. Actually, I don't know if I'll get it. Do you guys reckon you'll get it? [00:07:49][49.1]

Tracey: [00:07:49] I think you'll get it. Pretty sure you're going to get it. But look, if you build it, they will come. So we shall see. But like, I know you've got some additional thoughts here. [00:07:56][7.0]

Blake: [00:07:57] Yeah, I know there is another app store outside of Google and iOS. And the App Store I think is the third largest independent app store. And that's they didn't ask Siri back in 2016 or 2017. I don't know where they ended up. But yeah, you know, just the idea of having a decentralised app store is really interesting and I think one day someone's going to nail it. But it is a big audacious task, you know? [00:08:24][27.7]

Tracey: [00:08:25] Yeah, absolutely. I was saying there have been other companies in the past who've had these grand ideas of mobile phones inside. You remember Facebook or Amazon, you know, their mobile phones went nowhere. It's a lot harder than it sounds. I think so. I personally think Solana should concentrate on perhaps getting their blockchain working a little bit more seamlessly. I notorious for downtime at the moment, but let's check back early next year when Kai gets his phone and he'll give you an update on the story. Moving on, we spoke a few weeks ago about Celsius and 3 hours capital and liquidity crisis. Now, these are two very big players in the crypto space who are facing pretty much extinction and possibly taking with them some use of funds which are tied up in their woes. So we'll catch you up a little bit on where this has gone over the last few weeks. And now there's some pretty big players who are also caught up in this story. First, I'll mention two other companies who we haven't spoken about for before who have gone down a similar path to Celsius and three arrows who were kind of waiting for a bit of a miracle or a knight in shining armour to help them out. So Blockfi these guys are an exchange that offered exceptional yields to attract users, and it looks like they've lost close to 300 million in the last two years, meaning they've had to cut around 20% of their workforce. Now, Voyager, they're also a crypto brokerage firm that's lost 650 million over the last few weeks in everything that's going on. As people talked about these guys possibly going bankrupt, their hero did step in. And this is in the. Ome of Sam Bankman-Fried from FTC's. He gave Voyager $500 million or loaned them net to save the day, or at least for now. So we'll see how that goes. Craig, do you want to give us your thoughts on these two stories and go a little bit more specific on Blockfi and maybe Celsius? [00:10:17][112.0]

Craig: [00:10:18] Yeah. So let's talk about Blockfi and Celsius. So those two are the big crypto banks, banks in quotation marks and obviously banks, but they're see via centralised finance platforms where people could earn a yield on their assets and also borrow from these platforms. So what these platforms would do is that lend out your assets and take a margin. And what's essentially happened is now they've lost some of their cash and they're unable to honour some of their user withdrawals. And just like Wall Street in 2008, they may need a bailout, whether that's a buyout or a loan. But, you know, unlike Tuesday, this isn't the government stepping in. This is the free market stepping in. But, you know, have no fear. There's been plenty of people that have been rumoured to save the day. Goldman Sachs is one of them. And rumours broke that Goldman Sachs is trying to raise 2 billion with the help of other investors to buy up the assets on Celsius balance sheet. So if Celsius were to file for bankruptcy, this would allow Goldman to swoop in, buy the assets at a massive discount. And it's all a bit of a kerfuffle. So like, like what's going on with Blockfi and Sam? There's a rumour that Sam might be reaching into his pocket again. [00:11:30][72.9]

Blake: [00:11:31] Yeah. So basically what's happened is these passive platforms like Blockfi Celsius and Voyager all that have millions of users each have been over leveraged and lending to groups like three R's Capital, which was a hedge fund. 3 hours has gone down and it looks like all of these your retail platforms, all these consumer platforms are going to go down with it. The with regards to Blockfi, last week they received an offer of $250 million line of credit to keep the doors open from Sam from FDX. Essentially this means that there are conditions and it will allow FDX to come in and acquire the company for next to nothing, which would leave the earlier investors with the early equity investors into Blockfi with nothing. And Blockfi had previously raised over $500 million in the last two years and vaporised investor funds, which is extraordinary mismanagement. It's incredible that they've got to a point like this, and now they need hundreds of millions more to get out of the hole that they've dug themselves. There's been a counter offer to FCX is $215 million line of credit, and that's from Morgan Creek and Anthony Pompe, who were early investors into Blockfi. So they're basically trying to save their investment. So they're trying to raise ten or $15 million. But the word is that it might be challenging for them to do that. So it would be interesting to see how this situation plays out. But essentially what we're seeing is a massive consolidation of these failed companies that have overleveraged and not managed risk in the market yet. [00:13:11][100.0]

Tracey: [00:13:12] And there's a lot of chatter going on on Twitter here because there's just regular people like you and me who have money caught up in services that we can't access right now or in Blockfi. And they're seeing all these high level conversations going on up there and they're wondering why aren't you know, why don't they just take the offer from FDX to get bought out and then automatically the funds are there and available. But you know, here these guys are these investors that want their money to stay safe. So they're trying to raise capital. So basically, I don't agree with what's going on here because Blockfi could take this offer right now which which would immediately give Blockfi funds to pay back their users. So but what they're doing is they're not taking the offer. And all the original shareholders, which is Morgan Creek and Anthony Pompe, they're trying to go off and raise the money on their own. It's taking longer and longer and longer. They may not get the money and they're not taking that money from it. So what they're trying to do at the moment is put the shareholders interests over the users interests. Do you see what I'm saying? You know, they could take the money and they could get out of the trouble that they're in, unfreeze the assets and give it back to their users. But they're not. They're freaking out because all these early investors into blockfi, the shareholders don't want to take the deal. So yeah, they are effectively putting the shareholders interests over uses. [00:14:32][80.9]

Blake: [00:14:33] Yeah, it's probably just worth pointing out and emphasising in a little bit more detail the cause or one of the key causes for all of these companies, you know, having these issues and it's this hedge fund, 3 hours capital that they all lent money to and they are about to go into liquidation. I think word was they had between 20,000,000,020. $8 billion assets under management. The last I heard that there's been a court ruling in the British Virgin Islands to for receivers to go into their business and liquidate assets to repay their creditors. This is a massive deal and it's going to affect everyone in the sector. But at the same time, I think it's going to build a more robust sector moving forward because so many groups won't have so much exposure to one. One company. [00:15:26][53.0]

Tracey: [00:15:26] Yes. Interesting to see how this all plays out. We'll keep you in the loop as it develops each week. With that, let's take a break. And when we come back, we'll talk Shopify and a new metaverse. Welcome back. You're listening to the Crypto Curious podcast. Onto Shopify, who's getting a little more crypto fied? They are offering their 1.7 million merchants some new crypto features. Shopify are releasing something called token gated stores. Basically, you can make a store that requires an NFT to enter. Holders will get access to exclusive merchandise and events. There will also be NFT minting. Shopify brands can mint custom nfts to list and sell rights from their stores. They can use blockchains like Ethereum, Polygon, Solana and Flow to create their NFT. Now, I think this is actually a smart play from Shopify Boys because they they're obviously after a new segment of the market. You know, there's a lot of artists out there who are looking to enter the NFT space and they're wondering where they're going to sell their, you know, the art. So now they'll be able to use Spotify as a one stop shop to do so because they can actually get things minted through here. So what are your thoughts here? [00:16:48][81.6]

Craig: [00:16:49] Yeah, well, it's not uncommon for NFT collections to have exclusive merch, but there's really been no one that's taken over that space yet, like as a provider. And Shopify obviously makes the most sense of the biggest e-commerce platform. So they're moving into this space. But the one thing that excites me the most is the event side of things. You know, be able to mint on the Shopify platforms. You know, we've spoken about it before, concert tickets being obtained in the past. So this seems like a really cool onramp. We might hopefully get to a stage where, you know, Splendour releases will be on Shopify and they'll be NFT is and you'll be able to resell back onto Shopify again. So yeah, I love it. It's great. [00:17:28][39.3]

Blake: [00:17:29] Probably just unboxing that a little bit further and projecting into the future. Maybe one day we simply have a Metamask wallet on our phones and we use that to store all our ID as NFT is our movie tickets and passes and train passes as well as our different currencies that we use for different purposes in the in the ecosystem. So definitely I think that's the direction the technology technology's heading in. [00:17:57][27.9]

Tracey: [00:17:57] Yeah, that's pretty cool. But I have so many different merchants. I hadn't even thought about that ticketing side of things. I wonder if they got the capability to handle that much in one go. I suppose it's Shopify level to. [00:18:09][11.7]

Craig: [00:18:09] Ensure they're looking at it. [00:18:10][0.8]

Tracey: [00:18:10] Yeah, but I definitely think they going for the oddest place because that's where it's kind of coming to life at the moment. I mean, we're definitely in a bit of a NFT slump right now, but that's the traditional interface that we've seen in the last few years. But I really think that art side of things is moving up and taking hold, and this is where Shopify might really kind of take hold and get a bit of market share here. So, yeah, interesting. Onto our next story, a very ambitious 100 million metaverse R&D hub is being built in Melbourne. So Thailand based Metaverse Start-Up Trans Lucia Global Innovation has partnered with Australian software development firm Two Bulls and set aside an initial budget of 100 million to build a metaverse research and development centre here in Melbourne. Tables founder James Kain said that they were designing a whole new world, but went on to say that they'd be a notable difference to the outcome that Metaverse is out there like Decentraland and Sandbox. They want a translation metaverse to be a bit more committed to things like sustainability and be more people friendly. In his words, he's called out a lot about the metaverse as he goes on to talk about profiteering and opportunism, where in his new metaverse they'd been visiting a strong central vision around putting people before coins, putting people before profit, and putting environmental concerns before profit also. So like, is this a bit of marketing spin? Because it sounds it sounds a little bit that way to me. Or is this a space out there in a metaverse that needs filling is what's this all about, do you think? [00:19:45][95.3]

Blake: [00:19:46] Yeah, I'm not really sure. I haven't deep dives into it. But you know, the first thing that comes to mind is how many investors are we going to have? You know, there's already a massive industry of gaming that, you know, produce games for billions of people. And it's hard to see how many of these platforms are going to be dominant. You're just being an NFT am. I see. There's just so many people trying to build these metaverse and it's going to consolidate up. They're going to get acquired or they're going to fail. But yeah, it'd be interesting to follow the story on this one regardless. [00:20:23][36.8]

Tracey: [00:20:23] Do you think that that's what I've kind of tried to teeter a bit to the side and go for this environmental concern, you know, what do you think? [00:20:29][5.9]

Craig: [00:20:30] Oh, yes and no. I think, you know, they're probably just trying to find their value proposition. Like, what does that even mean? Environmental concerns. But for profit, like they're all building on the. The same thing. They're all going to be building on a blockchain regardless. Mm hmm. Mm hmm. It sounds like a yeah. I don't know. [00:20:45][15.2]

Tracey: [00:20:46] Well, there you go. On that one. We all think that that could just be a bit of marketing spin, but we'll see where it goes. We've been wrong before, so let's keep an eye on that one. Okay. Now to some short, sharp grabs of news to round out the last week or two. Break. You can go shotgun on this one. Go for it. Yes. [00:21:04][18.4]

Blake: [00:21:04] So Magic eight and a salon focussed NFT marketplace has raised $130 million for their series B, which is great to see that good projects are still getting funded. They've been growing at an insane rate and they've even been outperforming Opensea lately. So the Start-Up now carries a $1.6 billion valuation, which is pretty impressive. [00:21:28][23.3]

Craig: [00:21:28] Aussie Home and grown my dad SBF founder of FCX. The rumours are hot and heavy about buying Robinhood at the moment and he's released a statement that pretty much says there's no active M&A conversations, but he is excited by the product. But FCX would dominate the game if they bought Robinhood and I'm very keen to see if they will. I think they will eventually, but we'll have to just wait and see. [00:21:55][26.7]

Tracey: [00:21:55] Crypto exchange Binance signed up and coming football player Cristiano Ronaldo. He's virtually unknown at the moment, but Binance teamed up and must have seen something in him and have high hopes that his face will enhance the brand. We wish them all the very best. [00:22:10][14.5]

Craig: [00:22:11] Good to see the up and coming Portugal football players get involved. Yesterday the player earned game as he finally returned and players were able to make deposits and withdrawals from the game. The game was hacked for 600 mil in March and has been frozen ever since. The Axie team has since beefed up security and recovered user funds, but I think the damage may have been done and I do have an update on my axie players. They are becoming increasingly hard to motivate to play. They don't really want to play anymore. The SRP price has plummeted 99% and more investment into the fairies and the team is pretty much now 99% down. [00:22:52][41.7]

Tracey: [00:22:53] Just for the first time. Listeners, this axie game that we've just mentioned. I'll explain to the listeners you paid for some players over in or where were they in in the Philippines that play this game for you and for for the for the smooth love potion token. 

Craig: [00:23:08] That's right. Yeah. I had five players up. Yeah. They'll playing axie. They'll be making slurpy tokens. And so that bad I had five, you know, my friend had 50. I wonder how they're going. But now it's yeah, they're pretty much not worth anything. [00:23:23][14.7]

Tracey: [00:23:24] So you try these things, you're going to give these things a go. 

Craig: [00:23:27] Exactly right. 

Tracey: [00:23:28] And on that, we'll leave it there for today. Thanks for listening, everybody. As always, we love hearing your feedback. Please keep sending the emails through to podcast at Get Bamboo Dot IO and follow us on social media. The Facebook community is growing and we love seeing new faces in there, so please find us on that one and make sure you hit the follow button whenever you're listening to us like right now so you don't miss an episode and get notified whenever we release a new one. We'd also love for you to share this podcast with your friends and family. We know there's a lot of crypto curious people out there, and while this bear market is happening or this crypto winter is happening is the best time to really understand what crypto is all about and educate yourself and those around you. So please maybe send a copy of this episode link to some of your mates out there. Don't forget to write and review us in your podcast app. So thanks for listening, everybody, and we'll see you next week. Bye for now. 

Craig: [00:24:24] Bye. 

Blake: [00:24:25] See you later.