Shownotes
A lot has transpired since Sunday night's recording. I thought it would be best to do a shorter special episode to discuss this and the ramifications on the market moving forward.
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I can be reached by email at mcintosh@genwealthcrypto.com and on twitter at @McIntoshFinTech. My mastodon handle is @mcintosh@podcastindex.social. Looking forward to hearing from you!
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Music Credits
Rock Guitar Intro 07 by TaigaSoundProd
Link: https://filmmusic.io/song/8342-rock-guitar-intro-07
License: https://filmmusic.io/standard-license
Funky Life by WinnieTheMoog
Link: https://filmmusic.io/song/6040-funky-life
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Transcripts
Hey, SatStackers, it's November the 9th.
Speaker:This is Episode 81 of Generational Wealth of Cryptocurrency.
Speaker:I'm your host, McIntosh.
Speaker:Today's episode is a special news update in regards to the collapse of FTX.
Speaker:Of course, no one on this podcast is a financial advisor, and all information presented on
Speaker:this podcast is for informational purposes only.
Speaker:Now that we have the legal stuff out of the way, let's jump on in.
Speaker:All right, so this is definitely going to be a different episode.
Speaker:I'm going to do a very brief market update, and we are going to jump into the news, which
Speaker:will be about FTX, Binance, all this hoopla.
Speaker:We'll not be doing supporters tonight, I've had some support come in the last few days
Speaker:which I certainly really appreciate, but I want to give them the time that they deserve,
Speaker:frankly, and this is a case where there might be people who skip this episode simply because
Speaker:it's not at the normal time and so on.
Speaker:So I wanted to make sure that that goes to our regular podcast market update for the
Speaker:week or for the day.
Speaker:We did close at $15,877.06 for Bitcoin, Ethereum at $1098.85, so $1,098.85, and then Ethereum
Speaker:at $31.68, obviously those are all down.
Speaker:Bitcoin is down roughly $5,000, Ethereum is down roughly $500, and ADA is down nine cents
Speaker:or so.
Speaker:Most of this certainly could be pinned to the news that we'll be discussing tonight
Speaker:with FTX and Binance.
Speaker:This episode I'm going to do very little editing on by the way, I'm just going to apologize,
Speaker:I'm going to get it out as quickly as I can, but I just felt it was too important.
Speaker:Alright, so I've already talked about this a little bit, Sunday's episode was called
Speaker:is Alameda going to be Celsius 2.0, we talked on the 31st about regulation, and of course
Speaker:back on the 24th we talked about SBF Sam Bankman Fried's regulatory proposals that generated
Speaker:quite a stir.
Speaker:So we've been kind of discussing in some ways FTX and Sam Bankman Fried for the last few
Speaker:episodes, I knew that something was going on, of course, just a couple days ago.
Speaker:And then unfortunately yesterday morning very early, the news started breaking really fast.
Speaker:And the prices of crypto of course started dropping.
Speaker:This is across the board.
Speaker:So actually, in addition to the prices that I wanted to give, I wanted to go ahead and
Speaker:point out two other tokens, Solana has taken a deep dive, it is currently at 1520, it was
Speaker:down I think down into the 12s.
Speaker:And then the other is actually the token that FTX created, it's kind of their little utility
Speaker:token, and it was the core of all this.
Speaker:If you remember, Sunday, Monday morning when I was talking about they created this token,
Speaker:and then it turns out it's a very large part of their balance sheets, because frankly,
Speaker:I tweeted out earlier today, if I'm not mistaken, at this point, I don't well, one of the news
Speaker:items is Sam Bankman Fried has already declared bankruptcy.
Speaker:So he went from being a multi-billionaire to declaring bankruptcy in the course of a
Speaker:few days.
Speaker:And I don't wish ill will on anyone, I want to be very clear about that.
Speaker:But at the same time, to me, it's becoming very obvious that either FTX and Alameda Research
Speaker:were doing clown world handling of the client's money, or it was outright fraud.
Speaker:Now, in this country, we believe in guilty and excuse me, innocent until proven guilty.
Speaker:And I don't want to, the jury's out on that, so to speak, but it's a huge mess.
Speaker:It's very clear.
Speaker:I think they're saying $6 billion there in the hole.
Speaker:They're desperately casting about looking for someone to bail them out.
Speaker:Let's go back in time, just a little bit.
Speaker:Tuesday morning, 10.03 central time, SBF tweeted, I've got a few announcements to make.
Speaker:And basically, it's that they've come to an agreement with Binance pending due diligence
Speaker:and things like that.
Speaker:But Binance would be buying FTX.com.
Speaker:And that's actually important because there's an FTX.com, which is offshore, essentially.
Speaker:And then there's an FTX US site.
Speaker:And then of course, Alameda.
Speaker:All right.
Speaker:So that being said, and like eight minutes later or something, maybe five minutes later,
Speaker:five or six minutes later, CZ, the guy who started Binance, the CEO, I don't know what
Speaker:his title is, but anyways, he tweeted that they've made this agreement.
Speaker:Now he actually tweeted in that tweet, he said, it's a non-binding agreement.
Speaker:And I actually pointed that out when I tweeted about that.
Speaker:By the way, you can follow me on Twitter at McIntosh Fintech.
Speaker:And if you want to get this stuff more in real time, you might want to, because I try
Speaker:and post about this stuff, I can't always, but I do try.
Speaker:You might want to follow me on Twitter.
Speaker:And I'll have my Mastodon handle as well in the show notes.
Speaker:I don't know what it is, the full name offhand, it's McIntosh at something.
Speaker:I don't know the rest of it.
Speaker:Anyways, he said, this is not binding.
Speaker:And I thought that was very important.
Speaker:So clearly, Binance had not looked at their books yet.
Speaker:And then before the end of the day, they backed out of it.
Speaker:I don't have the tweet here that says exactly when, oh, I never even finished up, sorry,
Speaker:the FFT token.
Speaker:I apologize, I've got notes that I'm working off of, but honestly, this is not going to
Speaker:be as organized as normal.
Speaker:Okay, well, of course I'm having issues with Chrome.
Speaker:My keyboard doesn't work with Chrome.
Speaker:So I will have to improvise.
Speaker:All right, the token is the FTT token.
Speaker:And it's sitting at 228 in value and up until, let's see.
Speaker:It was at $25 or so up until, it looks like the 8th, no, the 7th, the 7th of November
Speaker:at 20, so late in the afternoon, late at night, sorry, 8 o'clock or so, and I'm not sure what
Speaker:time zone, to be honest.
Speaker:But it started dropping and then of course when this news broke, it dropped significantly.
Speaker:And now it's sitting at roughly $2.50.
Speaker:It's been a little lower than that.
Speaker:I think it brushed $2 or so at one point.
Speaker:I see a 214 here on this chart, but I'm not sure what the granularity really is.
Speaker:Regardless, obviously the token itself has taken a deep dive and that's simply because
Speaker:people started bailing out when they realized that FTX was the primary holder of this token.
Speaker:FTX looked like they were insolvent.
Speaker:FTX has big problems.
Speaker:So that was a big part of it.
Speaker:Solana is involved because apparently FTX actually, that was one of their bigger holdings.
Speaker:Interestingly, when the report came out, apparently they didn't really have any Bitcoin holdings,
Speaker:which I thought was interesting.
Speaker:So later in the day, as I said, Binance came out.
Speaker:They've now said they're not doing this deal, blah, blah, blah.
Speaker:I'm not going to speculate on motives.
Speaker:Some people think that this was done as a complete setup to expose FTX and SBF, Sandbagged
Speaker:McFreed.
Speaker:I'm just going to start calling him SBF just to make it short.
Speaker:That's certainly possible.
Speaker:I would say, to be honest, I would call CZ, and I don't necessarily mean this as a, it's
Speaker:not derogatory.
Speaker:Maybe it's taken that way, but he's cold blooded.
Speaker:He's a cold blooded businessman.
Speaker:So it wouldn't surprise me if that was the case, but there's certainly no data to suggest
Speaker:that.
Speaker:What it looks like happened is they made this agreement in theory.
Speaker:They opened up the books.
Speaker:He looked at the books of both Alameda and FTX and said, there's no way I'm touching
Speaker:this because they owed $6 billion.
Speaker:Everything's insolvent.
Speaker:Their token is going to zero, as far as I can tell, and Solana may go with it, to be
Speaker:honest, although Solana may recover, I don't know.
Speaker:But regardless, that's where we're at.
Speaker:Now, the market has recovered.
Speaker:Right now, in fact, Bitcoin is at 16,700, Ethereum is approaching 1,200 ADAs at 35 cents.
Speaker:So things have rebounded.
Speaker:We will see where this goes.
Speaker:We've certainly got a low.
Speaker:We got it below that June low that everybody kept saying we're not going to get below.
Speaker:So we've already done that.
Speaker:I am of the opinion this is not over.
Speaker:I think tomorrow morning, the CPI data will come out, and I will have published this already.
Speaker:I think they're estimating 8.1.
Speaker:If it comes in a tenth of a percent above that, the stock market is going to start going
Speaker:down again, and so will crypto, and it will press, I think we will see, 14,000.
Speaker:I've been saying this for a while.
Speaker:I still stand by it.
Speaker:I don't see any reason at this point to change.
Speaker:I may be incorrect, but if you recall, I keep promoting a strategy, you should be DCAing.
Speaker:I did some extra buying today, just in case.
Speaker:This is the bottom.
Speaker:You might be wise to do that as well.
Speaker:It's not financial advice, and it's certainly your choice.
Speaker:Bitcoin's not going away.
Speaker:I see no reason at this point that Ethereum is going away, nor ADA.
Speaker:But this activity will set back the crypto market for a long time.
Speaker:When I say crypto, I mean all of the assets.
Speaker:Now a lot of the Bitcoin maximalists are making hay out of this, and maybe they should be.
Speaker:They're talking about not your keys, not your crypto.
Speaker:That's something that I've said too.
Speaker:We've talked extensively about not keeping the majority, at least, of your assets on
Speaker:a centralized platform, whether that's FTX, Kraken, Coinbase, Binance.
Speaker:I don't care.
Speaker:You shouldn't have all your assets on that exchange.
Speaker:I would love to say this is going to flush out all the bad actors, but the reality is
Speaker:I don't think it will, and this behavior will continue.
Speaker:Now one of the other news items is that the SEC and, I believe, the Justice Department
Speaker:of the United States have announced that they're going to investigate FTX.
Speaker:Now the SEC in particular, I would say, huh, how?
Speaker:Because FTX.com is not a US-based platform, from what I understand.
Speaker:That's why they have a separate FTX.us or whatever.
Speaker:I'm going to look that up right now, actually, and of course the site may not even be down.
Speaker:So FTX.us is, earlier today, both Alameda and, so FTX.com simply redirects you to FTX.us.
Speaker:And research brings you to a screen that says, private site.
Speaker:This site is currently private.
Speaker:If you're the owner or contributor, log in.
Speaker:I wonder what that site is.
Speaker:Private WordPress.
Speaker:No, it's Squarespace.
Speaker:Well played, multi-billion dollar company.
Speaker:Oh man.
Speaker:Wow.
Speaker:Like I said, clown world.
Speaker:All right, so they have a Squarespace site up.
Speaker:I don't know if that was their old site and they've changed the front.
Speaker:They probably was Squarespace.
Speaker:Okay, point is, what's my point?
Speaker:Again, we're learning our lesson.
Speaker:We don't put large amounts of money in sites like this.
Speaker:We don't.
Speaker:Public storage, your wallet, hardware wallet, even your software wallet is better than keeping
Speaker:the majority of your assets on one of these sites.
Speaker:And I do not care which site it was, all right?
Speaker:So learn that lesson.
Speaker:As far, you know, I don't know if any of my listeners had any money on FTX.
Speaker:Obviously, FTX did a big marketing promotion here in the United States over the last year.
Speaker:Super Bowl ad.
Speaker:Oh, and one of the casualties of this is going to be apparently Tom Brady and his wife, who
Speaker:I don't know her name, but they're getting divorced, which of course is big news in some
Speaker:circles around here.
Speaker:But they did an ad for FTX and actually the majority of their fortune was in FTX and now
Speaker:it's gone.
Speaker:This was the kind of promotion they were getting, FTX, Rena or whatever.
Speaker:Maybe down in Miami, I think FTX is, you know, they spent hundreds of millions of dollars
Speaker:on all this stuff and they should have been safeguarding their clients' assets.
Speaker:But like I said, there's only two ways to look at this.
Speaker:Either it was a complete clown world of a business or it was fraud.
Speaker:And either way, I do believe, to be honest, I believe people are going to go to jail.
Speaker:If they prove fraud, there will be people in jail if they're U.S. citizens.
Speaker:I actually don't know where SBF is from.
Speaker:I assume, I believe he's a U.S. citizen.
Speaker:The legal team quit, compliance and legal, now those people actually would be criminally
Speaker:negligent or at least civilly, what's criminal and civil, civilly, civilly negligent, I'm
Speaker:not sure, depending on whether it was fraud or just stupidity.
Speaker:So they could be looking at severe issues and I don't think they're going to get out
Speaker:of it just because they quit.
Speaker:Oh, and by the way, the CEO of Alameda Research conveniently resigned a few weeks or months
Speaker:ago and then the new one came on who was there in the company, Caroline, she's not been there
Speaker:very long.
Speaker:So I could see a lot of people getting in a lot of trouble for this.
Speaker:Now that doesn't help all of the clients whose assets are either frozen or more than likely
Speaker:they will, if they recover anything, just like Celsius, it will be pennies on the dollar.
Speaker:So what we should learn from this is primarily hold your assets again and I will continue
Speaker:to emphasize this, we will forget this, we will move on, things will happen and I will
Speaker:continue to remind you to do that because it's super important.
Speaker:Now there may be, if you're trading or whatever, you may need to keep stuff online but do not
Speaker:keep the majority of your assets online, do not do that and don't keep it, maybe you have
Speaker:a lot in crypto and maybe you're trading with a significant amount, $10,000, I might not
Speaker:even keep all that on one platform, I might split that up, because you just don't know
Speaker:these are not transparent organizations, the blockchain is transparent and it's very interesting
Speaker:because the blockchain explorer type people, analytics, that's the word, the blockchain
Speaker:analytics people, they are finding out some very interesting things but the companies
Speaker:are not transparent, they're opaque and people don't know until sometimes it's too late.
Speaker:So just don't put yourself in, it's called risk management, okay, you have risk management
Speaker:in trading, you should have risk management in this because it's just not transparent.
Speaker:All right, that's really it, I want to wrap up, it's going to be a short episode of course
Speaker:but I just wanted to get this out there just to let everybody know what was going on and
Speaker:so we don't spend all Sunday talking about this.
Speaker:The Generation Wealth Cryptocurrency Podcast is a podcasting 2.0 podcast, it's actually
Speaker:a value for value podcast with no sponsors and no advertising and I want to emphasize
Speaker:this, literally today I had something happen and if they were sponsoring my show and forking
Speaker:over lots of money to me, I would not be telling you about this, so listen up.
Speaker:I have talked in the past a lot about the Strike app, it is one of the easiest apps
Speaker:out there to use and I was using it today to buy some Bitcoin, of course, just like
Speaker:I said and I was buying some smaller amounts as it went down, I was trying to catch the
Speaker:bottom basically because that's just, I can't help it.
Speaker:Anyways, I noticed on the third buy that, like I'll do it right now, I'm sure it's
Speaker:still going up, so I had the app up, Bitcoin right now is showing at 16, 629.99, the price
Speaker:up on my other monitor, which I don't know where that comes from, is 16, 679, so it's
Speaker:close, okay, buy, 25 bucks, next, $25, price, 17, 176, huh?
Speaker:And I poked around and I couldn't find anything, I actually submitted a support ticket and
Speaker:then I saw later, they posted something on Twitter saying, right, there's a basically,
Speaker:what did they call it?
Speaker:Let me try and find the ticket, the Twitter real quick, I'm almost sure it was on Twitter.
Speaker:And while I'm looking for this, of course, U.S. elections were today, a lot of people
Speaker:I think, maybe myself included, to be honest, thought that the Republicans, for better or
Speaker:for worse, it doesn't even matter, it's not a political discussion, but we thought that
Speaker:they were going to take over more of the House and Senate because of the last several years
Speaker:the things have been going on.
Speaker:That really didn't happen, it's looking like things are exactly the same.
Speaker:Here's the message that they put out six hours ago, we're aware that our BTC provider for
Speaker:the Bitcoin tab is experiencing high volumes and as a result, users are seeing higher spread,
Speaker:so the spread is between the price that's listed and the price you're buying.
Speaker:Now I'm buying immediately, at least according to what they're showing me, I'm not having
Speaker:to wait to have my order filled and yet it's filling at a higher price.
Speaker:So we apologize, we're actively working with them to rectify the situation, blah blah blah.
Speaker:So to me, this is a flaw in their program and if they were paying me a thousand bucks
Speaker:an episode, whatever, it could be a lot higher frankly for a large audience, I wouldn't be
Speaker:talking to you about that.
Speaker:Now I'm not saying you shouldn't use strike, but it is certainly something you should be
Speaker:aware of and to be honest, unless I'm out and I have money on strike now, so I'm going
Speaker:to have to use that, but until they get this fixed, I'll be using something else to do
Speaker:any major purchases of my Bitcoin.
Speaker:So keep aware, that's what I'm here for and that's one of the reasons why I do value for
Speaker:value and I don't have sponsors or advertisers, because that means I get to tell you all the
Speaker:truth as best I see it, okay?
Speaker:All right, so back to the script, I actually have a script for this, of course.
Speaker:You can support the podcast in three ways, time, talent, and treasure.
Speaker:If you want to support the podcast and has some time or talent, I am working on chapters,
Speaker:I actually ran into a roadblock with that to be honest, not to get off on this.
Speaker:I'll talk about that more Sunday, but maybe transcripts would be nice, I could use some
Speaker:help there, things like that.
Speaker:Treasure is just what it sounds like.
Speaker:If you find the content valuable, you can support the podcast by streaming Sats from
Speaker:a Podcasting 2.0 app.
Speaker:Like I said, I won't be going over support tonight.
Speaker:We've had some support this week and I do appreciate it and I want to honor those people
Speaker:next Sunday.
Speaker:If you like the content, I would love it if you would tell your friends about the GWC
Speaker:podcast.
Speaker:Thanks for being here.
Speaker:I do hope this has been helpful and it's given you something to think about.
Speaker:I would love to hear from you.
Speaker:I'm on Twitter at McIntosh Fintech.
Speaker:You can reach me by email at mcintosh@genwealthcrypto.com.
Speaker:Of course, the generational wealth website is at genwealthcrypto.com.
Speaker:And on Mastodon, I have it right here, I just opened up the client.
Speaker:It's McIntosh, at Macintosh, is I guess what I should say, at podcastindex.social.
Speaker:So it's the podcastindex.social Mastodon instance, which is the Podcasting 2.0 Mastodon instance.
Speaker:And then of course, I'm McIntosh on there.
Speaker:So even if you're on another instance, you can still plug that in and use that to follow
Speaker:me or send me messages or whatever.
Speaker:So there you go.
Speaker:Stay humble.
Speaker:Be safe.
Speaker:And I will talk to you all on on Sunday, okay?