Critical Thinking Brain

Uniswap? Decentralized? 

https://twitter.com/SolidusMax/status/1428476167775006727

https://es2.slideshare.net/nivertech/limited-supply

Everyone should understand natural crypto inflation and the concept of nothing for something. This concept is most abused with stablecoin issuers, but also with other cryptos that inflate themselves- like bitcoin, eth, etc.

GBTC is a business trust. 

Ownership shares trade transferring ownership of bitcoin held in the trust. But owners can't take the bitcoin out, all they can do is sell the shares to someone else. 

I mention ponzi dynamics, I really mean the same zero sum dynamics. Ponzi is the the illusion of profits from some kind of 'investment', but anyone making money on GBTC does so because someone is buying at a higher price than them.  But the beauty of this is that as a shareholder you actually do own the bitcoin inside the trust. So even though you only profit from selling shares to someone else, you do actually own the bitcoin inside, and it isn't the definition of a ponzi. A real bitcoin ownership exchange is taking place.

No one can't take the bitcoin out and force the GBTC to trade 1 to 1 with bitcoin. There is no arbitrage between GBTC price and bitcoin price. Maybe that is there for a reason. Maybe that is why the SEC still will not approve bitcoin ETFs. 

GBTC is all about perception. To an extent so is bitcoin, but GBTC is removed once from the actual bitcoin, since the bitcoin cannot be sold if there is a premium and rebought at the lower market price. If GBTC is a business trust the trustee should be acting to the benefit of its holders. 

The rules of a trust state the assets in the trust cannot come out- perhaps that is the reason the bitcoin can't come out to profit off of the difference in prices between GBTC and bitcoin. 

GBTC is an interesting product. Create a crypto and put it in a business trust- that means that it can never come out. If it is a stablecoin, it can't be redeemed. Is this a way of manipulating crypto prices? Create a new token, lock up most of it in some kind of trust vehicle, then it looks scarce, or it can't ever be redeemed if something 'backs' it.

Stablecoin is about price stability regardless of mechanism to achieve that goal.

The ultimate goal in cryptoland stablecoins is price fixing.

Is price fixing illegal? Yes, but his requires 2 or more groups setting prices.

What if one company did price setting?

Could you argue that the Tether secondary market is helping Tether price fix? No, because if you believe in the integrity of the exchange this is supply and demand.

Price fixing is the absence of supply and demand.

If a crypto achieved stable fixed price at one dollar would they consider this real dollars? If they are thinking clearly, they should say no.

People that want to regulate all stablecoins need to come up with a better term of what exactly they want to regulate. And just using the term stablecoin does not cut it.

If everything is an opinion, then arguing that something is not a security is just an opinion right?

Why do we have securities laws? Should they rewrite them to say securities opinions? And what makes an opinion a criminal offense? The power of the state. 

How can a lawyer get in trouble with the law for giving its client an opinion?  Are they always off the hook for what their client does? Legally, ethically?

Must be pretty go to be a crypto lawyer. 

I discovered this idea that lawyering is about perspectives from watching this excellent lecture below.

Most people do not understand that what the SEC gives guidance on is just an opinion. Only congress, who makes the laws, determines what is and what is not a security. Only the courts determine when that law applies. 

https://www.youtube.com/watch?v=kRl6VhBvQZ4&ab_channel=YouCounsel

Saifdean and Saylor need an official community college.

Community Colleges are to be made free with the new infrastructure bill. That means the government will pay students to attend so they can do so for free.

Crypo Community Colleges should take full advantage. Hopefully there are no requirements to be ‘accredited.’

I’m sure we will see a massive boom in new Community Colleges.

Same thing applies to pre-k. There should be a Crypto pre-k for 3-4 year olds. It is never too early!

Think of a patent troll company. Then think of the crypto version.

A company that exists to profit from suing DAOs. The company uses its funds to buy ownership tokens in many defi daos or protocols.

The company waits for a governance dispute, a bug, or a disagreement with the way the DAO is being managed. The Company researches vulnerable DAOs, where members are exposed to liability, and wealthy protocols that have so called large treasuries, which can mean the governance token itself, like uniswap.

Many people call patent companies that sue other companies for violating a patent that they buy trolls because their purpose is just to sue other companies. But there is some value in that, and if it is legal to have patents then it is the patent holder’s right to extract rents from others who use it.

If you dislike patent trolls then fix the source- let’s pass a law getting rid of patents, then we won’t have patent lawsuits anymore. But, that is not going to happen.

Patent trolls help clarify what the patent really is and what it isn’t by bringing these cases to court. One might argue that it is wasteful to spend money on this, but wasteful to who? The courts are a public service of sorts- they are made available to everyone. It is certainly not wasteful to patent troll companies. It is harmful for companies that get sued over a patent, but they can be sued for practically anything in this country, so focusing on patents doesn’t seem warranted.

What is the value of a patent? How does someone actually know until they see what they can get for it? Meaning they try to press their rights or rents they are owed by anyone found to be using their patent. Perhaps you argue you can’t know the value of a patent until bringing court cases. A patent by itself doesn’t produce income until you take an entity to court and have a judgment made in it’s favor. Can crypto by itself extract rents like this? Well not exactly like this. But you can extract rents just from owning an ownership token by suing it’s members. But how? Ownership token’s give certain rights by nature of having ownership. It is in the name. Or by giving voting rights, etc. You make money by pressing these rights in a court of law. By arguing that your rights were violated by other managing members that have more liability than you.

Crypto companies have less of a moral defense than the targets of patent trolls. Crypto people tend to think hackers should be able to keep their loot. And I tend to agree for the very fact that the idea that blockchain is ‘immutable’ and you just have to accept any transaction to the ledger since there are no ‘gatekeepers.’ You live by that game, you die by that game, meaning that code is law. Also law is law, and anything that can be done with law will be done and anything if fair game.

This might already be happening, and companies are getting private settlements. This may not be happening yet, because there is more money to be made not attacking the industry.

This kind of company is inevitable.

It is inevitable because the law isn’t clear on DAOs and many DAOs are honeypots that have massive legal vulnerabilities.

Crypto and the Law

What is the Law

Lawyers filter perspectives

Perspectives change