Listen to Episode

Read Episode Transcript

Our daughter's head is dropped because the. Our doctor, she she felt the head and she was like, yeah, it's it's H mouth. Whose head has gotten bigger, yours or your daughters? What do you mean? Don't quit your day job? Sex? Yeah, sex that didn't quite land. Land show. He's trying out material. Total flow. We are not in rhythm. You know why? It's mercury retrograde? Our 50th episode is gonna suck because of this. Here we go, 3/2. Let your winners ride. Man David. We open sources to the fans and they've just gone crazy. We can. Alright, the Facebook whistleblower hearings occurred. And Facebook. Where's your hey everybody, hey, everybody, hey, everybody, Huh 32. Hey everybody welcome to another episode of the all in podcast episode 50. We made it to 50. Cinquanta nobody expected us to make it here. We are, we've made it and everybody is thrilled to be here with you and thank you for the support over the first 50 episodes episode closer to getting cancelled. One episode close man, how great would it be to be cancelled and never have to work again. It would be wonderful. OK, so Francis Hougen revealed herself on Sunday night. On 60 minutes and then appeared before we get our own personal interests or no, we're done. And you're unbelievable. Retrograde. Mercury retrograde. Mercury retrograde. Doesn't the audience know us by now? After 50 episodes, you're really interested. Three. You have to put up with this again. This week is the Rain Man himself, David Sacks, and the Queen of quinoa, David Friedberg. I love the intro, of course. The dictator, Chamath, Polly, appetite A and I'm your boy, Jay Cal sacks. I got to say, I think, I think your AUM is positively correlated with the bags under your eyes. If you mean it's getting bigger, you're correct. Heavy, good Lord. Heavy. Dragging you down. That's where you're hiding all that Salana in your ******* under your eyes. You better clear that Solana position. What's your lock up? 24 months? **** no. He's trying to sell it to me on text message. Yeah, of course we're negotiating discounts. I just had the fact that you're ******* the whole thing up, bro. You don't. You don't think I'm hardly. I'm hodling. Millions of dollars of anything without a discount. Everything is a discount. Everything's discounted. You want to clear that position in an LLC? Are you saying I got a billion dollars of Solana? No, bro, I'm saying I have one. But, you know, I brought a discount, but you're holding, correct? Ish. Me too. Well, I mean if something appreciate at what point is the appreciation and an asset that you've invested in early something you need to you know at least clear a position of and lock in a win, I mean. What's enough 100X500X? You gotta at some point Bank will win, right? Well, I think you have to put things in a bucket of like, is it an investment or is it something that represents an idea that you love so much? If it's the latter, you should never sell. If it's the former, yeah, you got to manage risk and you're rather, you know, is it a trade or is it something you want to own? By the way, let me just clean this up because it was, Solano was not a direct investment for us. What we did is we invested in a in a crypto. A venture firm called Multicoin Capital, this is back in 2017, we realized like, crypto was becoming like a full time job for us as a total rabbit hole. And we were like, we don't have time to figure out the site, 24/7 training stuff. But we met Kyle and Tushar, who were these two young guys. We met him through Vinny Lingham, actually, and they were creating Multicoin capital and we actually invested. We gave him 1,000,000 bucks at a 20 cap to help set up their firm. And then we invested in their they had both a venture fund and a hedge fund. And they were like the first money into silana. So that fund, I mean it's it's like 100 X fund, it's just like bonkers, crazy. And so as a result of that we are indirect beneficiaries of this huge increase in Solana. It will end up being about, you know, a billion dollars of. I think silana for us in terms of returns, but but it's the multicoin guys determined the trading decisions on that, yeah. And so people who don't know Solana is a programmable. You know, Etherium competitor, I guess, and it's at $50 billion or so market cap, it was trading at a dollar. Not long ago, and now it's at 164, it's an Ethereum competitor basically for, you know, smart contract platform. And there's a lot of people, I'd say smart money in Silicon Valley who are betting on a flipping where Solana could ultimately overtake Ethereum as the preferred platform. But even if it doesn't overtake Ethereum, it, you know, it's the number 8 cryptocurrency right now. You know, it could go, there's a lot of people betting it'll go to #3 or, you know, what have you. Additionally, it is a. Fraction of a penny for a transaction, and it can do many more traction actions than Ethereum. So it's, you know, technically should be much cheaper. If you're buying NFTS right now, you're probably spending. You know 10s of dollars you know in fees on Ethereum, whereas if you did those same NFT which some people are starting to do on Solana. They would cost a fraction of a penny, correct, David or Strama. Yeah. I think the the platform is is known for being a faster, cheaper, you know blockchain. Really, really congratulations. And if Vinny lingham's. Instagram is any indication. He did pretty well because his Instagram suddenly turned into a world tour on private jets he'd like, which, which, which island should I buy? And, well, look, Vinny was sort of like a I don't know, I think he's full time multicoin, but he was sort of a venture partner to Kyle and Tushar, and he helped set them up. This is back in 2017. He helped bring us in as the first investors. And I mean, for us, it was sort of a founder bet combined with a like a team, like sort of a space bet, like we knew the. Cryptocurrencies are starting to be traded 24/7. We knew it required more of like a hedge fund skill set than what we had and so we made, you know, we made a bet on those guys and man has that nice paid off strategies, right? Sacks is if you are L peeing in new fund managers, which I've done a couple of Times Now, you get to learn from them and basically dive into a data set of a new market, right? I mean, it's like one of the nice things about being an LP and a fund. As you can place a small bat, whether it's 50K or 500K or 5,000,000, whatever it is you you get like this meta education of an entire sector, correct? Yeah, but I think, you know, we didn't do it to learn from them, although we have. It's more that we realized that crypto was, like I said, becoming such a rabbit hole like it. We realized we we would either need to do crypto full time as a fund or we would need to like partner with people who actually did. And you, you see that with like a lot of VC firms now is they're creating like specialized crypto funds or at least they have specialized crypto partners. There's so much to know about the crypto world, it's a hard thing to invest in unless you're like totally focused on it. I've struggled with that like I've tried to. Go deep on a couple topics and like, I realize, holy **** I've been in this for like 4 to 6 hours just trying to learn this stuff and I'm not like there and then I feel uncertain about making any decisions. I, I I totally get it. I mean you got to have folks like working on this and the, the, the pace is changing so rapidly, you really need to kind of be up to date on on what's next. You know the other, the other issue really challenging is when you look at crypto, people use the word crypto as if it's like, that's all there is. Totally. Crypto is like extremely computing, right? Dash cryptography, uh, you know, financial modeling or building new economic systems. Chamath. There's business model innovation, there's technology innovation, there's economic innovation. It's distributed computing innovation, yeah, infrastructure, infrastructure, hardware. I mean, there's there's quite a lot of. Layers of activity tomorrow. Are you spending time in crypto yourself or do you have people doing it for you or how are you? Kind of. We have, look, we have, we have a lot of it. Thought of a lot of everything. So yeah, we have things to do. You go deep yourself to mouth, like, how do you spend enough time to really get up to speed on all the goings on? I cherry pick and I snipe and opportunities where I get intellectually curious and jump in. But a lot of the credit goes to my team. There's a couple folks that spend a lot of their time in it. And you know, we've we've had a couple people do extremely well. For us? Uh, you know, similar, similar to David's story back in the day. You know, I invested in Barry Silbert and DCG market. Barry Silbert, yeah, and you know, DCG is now, I don't know, I'm guessing a $20 billion company. Maybe more. I don't know, how does it mechanically work with your team? They they are investigating opportunities and then they come to you and bring you, you know, hey, we'll do a meeting and I'm gonna share four with you and then you say, hey, let me get on the phone with that. Do you basically go deep, go deep when something shows up, Shamar? No. So. So basically what happens is they have carte blanche to do whatever they want. And what they're typically doing is they're working with entrepreneurs to seed projects and, you know, to to to get projects off the ground and then at some point when those when those projects become large enough. Then they'll issue tokens and, you know, we'll get a certain allocation of those tokens. And so we've done that for, you know, call it. I don't know. Some number of projects that we think are valuable, then along the way, you know, they'll have certain views on Bitcoin, they'll have certain views on Ethereum, they'll have certain views on Solana and we'll make capital allocation decisions. They tend to have the ability to do whatever they want. And then what I tend to do is just think about when it gets above like it to me, I need to see the chance to make at least, you know, in the rough justice around, you know, 500 to a billion dollars and then I'll get involved. But otherwise they just kind of run the whole thing. Let me ask you guys a question here. You know, when you look at the market caps of these projects, it seems like. Things are changing. Uh, Cardona or Cordana is #3 now, and tether still remains #5 XRP, still #6, but so long. I would encourage people to not look at it like that. I think looking at it as a rank list betrays what it is. So, you know, I'll give you a simple example. Let's like compare the the fate of two projects. Or actually right now there's a distributed form of discord that's being built. Discord, the chat app, very popular amongst gamers, completely distributed way with an integrated crypto wallet. Because if you look at discord, it's really 2 cohorts of people. There's gaming and there's crypto, right? So the two big ones, yeah. So you know, that's an example of a really interesting. Product that has some real potential. Then if you look at something like deso, deso is a decentralized social. Programming framework. Then if you look at something like helium, that's completely about. Building a large distributed, you know, connection of of on ramps to the Internet. So Internet connectivity. So those are three completely different ideas with three completely different paths to success. If to invest in those tokens, you have to believe in three totally different sets of things. So to look at it on a ranked list and just buy something because it's cheap is. Yeah. No, no, no, no. I'm just gonna be blunt. It's stupid. Don't. No, no, that wasn't really my question. My question was, you know, we, we have an extraordinary number of the public who have invested in Bitcoin. Ethereum as #1 and #2 and those projects. Feel may be stagnant when compared to the dynamism of what I'll call, you know, the projects launched in the last three or four years because there are different. No, but you're talking about confusing again, this is what I mean. Those are layer one protocols, right? Meaning they are at the core substrate of how all of crypto is going to work. Then you have these other projects that build on top of these things in different ways or build around them. So my point is. If you don't have, if you don't want to take the time to understand which layer twos you want to own and which layer ones you want to own and why, I think you're much better off. I understand your point, my point in ETF or something else, because there are, there are ways to own these things. So, for example, David, David Solana is does not need etherium to exist. So my point is do we, do we see a day when this, you know, the past decade has been about Bitcoin and Ethereum? Do we see a day? Then maybe people stop buying those and start buying these new ones. Anything's possible. But here's here's the evolution of our thinking. I mean, the the first step was realizing, OK, we need to own Bitcoin. Why? Because. You know, there's not enough evidence where what, like a a decade and we're more than a decade into this, nobody has been able to essentially counterfeit a Bitcoin. It is, you know, new money. It is, it is better money. So if you it's. So I'm not going to convince people right now if the argument for Bitcoin, but if you believe in it, that's sort of the first step is you realize you really need to have one to 2% of your portfolio in Bitcoin. In the event that Fiat money sort of becomes debased and eventually moved to crypto. Then you realize, well, wait a second, Bitcoin is just one application of blockchain. There's a bunch of applications of blockchains. So maybe we need to own not just sort of, you know, digital money, but we also need to own the underlying blockchain platform and that leads you to Ethereum. Then you realize that there's a bunch of competitors to etherium and it's still very early days and one of those guys might ultimately displace etherium subchain platform. Then you realize that there's all these applications on top of all these block chains. And so, you know, the conclusion I come to after all of that is I can't figure all this out. And, well, maybe I could, if I was willing to go back to school and like make this a full time. Job, which I just don't want to do. I mean, I'm lazy and that's why I focus on SAS. Like, that's what I know you're killing faster. Yeah, like I'm not gonna reinvent myself. It's like you playing hold them versus PL, right, right, right. Exactly. So but This is why we partner with Multicoin Capital. So what I would just say is like the idea that you as an individual investor again, like, you know, pick off the one cryptocurrency here or there to invest in. I mean that's going to be a lottery. I would, I would find a manager basically who is really good, who has a track record, who understands this. Our approach is to hire very young, extremely technical computer scientists and mathematicians to basically do the work. That's that's working. Yeah. And you know, one of the things that I think these guys do and the reason why it is very helpful for them to be computer scientists is these are all open source projects. So they go look at the repos, just go look at it, go look and actually see the changes being made. And this is like she realizes only 12 people who are actively working on Solana in in the. But you need to, you need to look at all the code check seven of them work for Solana. You need to look at all the code check-ins. You need to look at the velocity of the code check-ins so you can see like how many projects are being created on these platforms. White papers are also really exceptional. Like if you if you read these white papers, they are, they're they're they're really incredibly thoughtful and and well written and you can really understand what their goals are and. You can make some informed decisions there, but again, if you're not going to be in the business of being in this ecosystem because I think David's right. Everything is moving so fast. What's successful today could be just a dog tomorrow and vice versa. That I think speculating in this market will. Not only will it be super volatile, but more than likely you're going to lose all your money. So I would encourage people to not speculate in crypto. I would encourage you to figure out an elegant way of having an abstracted bet if to the extent you care about it. And by the way, in the UK for example, there are ways where you can own publicly traded mutual funds. That give you exposure to this? It's just symptoms, yes. Yeah, but there are mutual funds of crypto the work find these mutual funds, just own those things and let somebody else do the hard work because this is too, it's too hard. Some of the other investments we made back in 2017, 2018 time frame one was a company called Bitwise, which was creating an ETF for crypto. So it's a a monthly rebalanced portfolio of I think the top 10 cryptocurrencies and you could buy it. They, they finally got approved by the SEC and you can buy it. Like with the ticker symbol from your ETRADE account, exactly. So that was that was pretty incredible to see the progress they've made. And then the other big bet we made was just institutional custody. Back in 2017, we invested in Bicco actually Bill Lee helped found that company many years ago and then that became last year's Galaxy announced a deal to acquire them for thing 1.2 billion, largest crypto acquisition to date. The thesis there was just that crypto would go more institutional. And I think we're starting to see that now where endowments and so on are realizing they need to have some portion, maybe one or 2% of their portfolio in crypto. And so, you know, they realistic, look, we have two almost $3 trillion of market cap in crypto. It's unrealistic for folks to expect people to be able to be living in discord channels and doing all of this work. I think what that means is that the SEC is going to be asked increasingly more often to approve simpler on ramps for this stuff. And now in the last week by the way, we had a pretty important two things happen. Both Jerome Powell and Gary Gens are basically said crypto is here to stay and and you know, we're not going to ban this stuff and so. Hopefully what it means is that you get some ETFs passed in the United States. You know, Grayscale is one, there could be more, and I think that stuff makes it much easier for folks to. Owned this stuff well. Clear regulation would be a great thing for the industry, for people to buy into it and removing some of the, let's call them. I don't want to say bad actors, but people who are maybe questionable like tether, you know? I don't know if you saw the Bloomberg story yesterday, but you know, a Bloomberg reporter basically found out that tether, he got the list of what tether owns with their stable coin, and it looks like they're giving a lot of loans to other crypto projects and own a lot of Chinese paper in that they are basically making the float on $69 billion sweeping it. Which then incentivizes them to take risky bets because they get paid on them and it's anything but a stable coin. Yeah. If you think about it from that regard, it's, I don't know the details on tether. I won't speak to that, but I'll say that any stable coin, if it's not 100% backed by dollars, if that's a currency that's going in and out or other hard currency that's not a stable coin. You know, a stable coin is supposed to be a service. It's not supposed to be a a speculators currency. It's basically just supposed to be. A mechanism by at the on ramps and off ramps of the crypto ecosystem you can convert your dollars into a temporary again stable coin that will hold its value until you can it poker chip that you can use to then buy Bitcoin or Ethereum or whatever. Yeah, USDCUSDC Jeremy Allaire's circle competitor from circle. Just said that he would switch to 100% to what you're saying Cash Cash equivalents it guys, this is, this has always been a money market fund. It should be treated like a money market fund and it should be regulated and managed at the money which was tethered original vision and then they flipped the script because I think they got greedy and now they own I think 3 or 4% regulated by the way by the way it it speaks to the role of regulation. Like you know a lot of people have trust and faith because they make some claim but there's no regulator actually checking on their claims. The only people that want regulation. Are two ends of the spectrum so young and so disruptive where they want rails to operate legally, and so big and so over the top that they want to basically entrench themselves for the rest of their lives? That's it, no? And everybody in the middle doesn't really want regulation. What's a what's a way to create a company? Or if you're a big tech, you both want regulation. Well there, but there there are some narrow cases like again you know if if if a stable coin is going to say that we are just a money market fund, we're 100% dollar reserve. It is really nice to have a regulator, somebody we trust to go in there and put the stamp of approval on it so we can trust it or that is. That is a valid role, I think for a regulator in traditional financial markets. You have these self regulating bodies. I I think it's dinner is a self regulating body, right? And so, you know, some of these self regulating bodies should be formed in the crypto community. I don't know if they're doing this, I'm so naive in this space, but certainly would make sense to have an SRO form that that does self policing effectively within the community rather than try and bring in a government regulator. Here's the thing, if you police yourself you can really define the execution and the ramifications of that. Leasing, if you have 30, call it competitors and cooperators in the in the market space doing this together it can be a highly effective model for creating a system of trust and reliability and not having to, you know, bring in, you know, call it outside incompetence to overseeing the rules and rights. Yeah. Another area we need standards is around the token cap tables for these projects, right. So how much, how much of the token CAP table goes to the founders? What are the rules around them selling? What are those vesting periods? Now, what are the disclosures around them selling in public markets? We have 10B5, so if you're an insider who runs these companies, you have to disclose when you're selling. There's no similar rule for crypto. I think they're probably should be right. Like if you own the, if you own the token and you run this project as publicly traded in, the public can buy it, you should really probably have to disclose your your sales. And maybe you know these. It's very strange because they're running foundations and I had a crypto person on from a music crypto. Project. And he said they had like 3 or 400 million in this project in Panama. I was like, who's on the board of that? And he's like, I can't say. I don't know, why can't you say? And he said security reasons. I was like, well, anybody who's on a public board has to be public. And of course, they have, you know, people who are on the board of GE or IBM or Amazon, they have security issues. Like they deal with their security issues. That doesn't mean they don't disclose who they are. Like, yeah, I'm not comfortable saying who they are. And it's like, OK, well, they sold 3 or 400 million. I was like, how do they give that money out? I'm like, he's like, I'm not sure. I'm not on it. I'm like, what? Like there's some organization in Panama? That's it was really weird. And I think one thing that I'll say positively about, about these crypto founders is that they will never allow a single venture investor to clog up their cap table. Number one, they do a great job of creating these large broad syndicates of participation when they seed their projects. And then, you know, a lot of it goes into treasury where then they issue coins as needed. And I think that that strategy actually is very pro employee and pro ecosystem. So, you know, when we see these projects, all these companies tend to raise. You know, 345 million bucks, it all tends to be at like 30 million pre and it all tends to be distributed. So like, you know, you know, it's us andreesen Sequoia, and it's like, you know, we put in 200 grand each or 400 grand each. You know, that's why you're forced then go into the market if you believe in a project and then spend hundreds of millions of dollars to buy into it after the fact. And I think that that's very, very powerful. It's a really important dynamic that if it comes back to traditional venture, could be really disruptive. Why? Well, could you imagine a a SAS founder that basically all of a sudden says, alright, you know what? I'm raising a $6 million Series A you know, craft can take 500K, Sequoia, you can have 500K, you know, blah blah blah folks. And then you raise 6,000,000 bucks that way and you never allow anybody to have more than. Call it, you know, a few percent of a company. So the fact that it's like a, it's like a mini IPO. It's like a private IPO on Sandhill Road. Yeah. And then your board construction looks entirely different. And then as a result, you know, founder protections probably go way up, employee protections probably go way up. It's in. Governance goes way down. No. I actually think what will happen is you're less likely in around like that to be OK with some dork *********** joining your ******* board. You're going to actually point to some industry expert and say this person is joining my board, she does XYZ job at such and such a startup. And then the investors say, wow, well that's a pretty great advocate for the business. Go ahead and do that. Another thing I learned about this whole token space was when I talked to Anatoli from Solana, when they sold their three or 400 million tokens to fund the company because they consider them utility tokens, not shares, they paid taxes on it, so the IRS is getting massive amounts of tax revenue. Well, think about it, they're selling the token it's supposed to be for utility will, therefore it's a taxable event. That actually was really smart. That is showing, I think, some wisdom, because there's a lot of founders who want to have their cake and eat it too. Which is to say they want to say that these are utility tokens and and they don't pay taxes and then they when they later get traded, they want to say that they're not you know they're not securities. But so when does the tax get paid? I think it's really smart to pay the tax upfront to establish that this is a corporate sale. They're basically paying the corporate tax, right. That is what is because this is this is the problem is if if you wait until they're traded publicly and then say no, no, no they're they're utility, focus on security tokens, the government is going to ask you, well why didn't you pay? Corporate income tax when you sold them, right? So that that is actually showing some perspicacity I think. Could somebody look that word up for me? Foresightedness Jackal? OK, great. Awesome. It's so great that you have the two producers on either side of you right now feeding you vocabulary words. Well done. So here's a here's you know another question with this. If the majority of people sacks, just put your legal hat on for a second. If the majority of people who bought a token in a project will call it the, you know, Acme Crypto project, they buy Acme Coins. If they're buying them and they have absolutely no interest in using them for the utility, and they say I bought these as a speculative device and the founder says their utility tokens. But let's say 70% of the people who bought them said I didn't buy them for that reason. They just came out right and said I bought this to speculate on the price. What should the government do? Should they deem them a security or should they deem them a utility token? I think that's a a complicated question, but I I think that there should be an opportunity for these cryptocurrencies to establish themselves as utility tokens because they are, they do serve a purpose. They are designed to be part of a system, right. They they're not just objects of speculation. And by the way, even if they were, we don't we don't treat baseball cards as, you know as as sort of as security. So it wouldn't necessarily make them a security just because they're speculated on. They actually do serve a function and. Designed computer system. So I think what's important here is that there's a safe harbor where these crypto companies know what the rules are and if they if they can basically meet the criteria such as by paying corporate income tax when they sell the tokens and other things like that, that they won't later be deemed to be engaged in unlawful sale of securities. I think the I think the important thing is just that entrepreneurs founders know what the rules are so they can abide by them and not be surprised right now so they don't get. Surprise later. They don't get whammied, but with basically, you know, because they are building something legitimate here, you know, right? But it would seem to the sniff test if the people buying the tokens have no idea, have never written a line of code, have no use for them. I don't see why that's relevant. I don't see why that's relevant. Well, because they are profiting off of them as if they're shares. And unlike baseball cards, which you can't sell 1000 baseball cards for an, increasingly, you know, you know, in a in a very instantaneous way, you would have to put them in an auction, which could be a lot of friction. There'd be a lot of friction. You could certainly like. Yeah, freeberg, what do you think if the majority of people buying a token are doing it to speculate? Can the Founders say it's a utility token? And then those people who are trading it like either baseball cards, minted coins, whatever analogy shares you want to use are in it for the increase in the value? Should it be a security and should they have to play by the rules we play at in the traditional venture startup game? I mean, the question is, what's the utility? So I mean if you can demonstrate. Some utility. Then maybe that's the, the, the and this will probably be litigated at some point, right? I'm sure there'll be enough capital. Sloshing around here that someone will say, you know what? We believe strongly. We're seeing this happen with Ripple already. But someone will litigate this and we'll get some clear definition on, you know, what statutes are going to be referenced and what those statutes might say with respect to the how this ties to the definition of utility. And then that'll become hopefully a standard that that people can kind of look to to guide them in the future. But it's definitely the Wild West right now, and everyone's going to try. The reason I bring it up is because Gensler was sort of floating this argument. Chamath, what do you think? I think that you can't wipe $3 trillion of value out of the world, and so problematically hard to do. Got it? So it's here to stay. And it's too institutionalized now. So, you know, there's just way too many organized pools of capital that are now speculating inside of this entire ecosystem. You know, I saw a tweet today. There was a there's a firm, I think like called Jump trading or something. It's like a. High speed frequency trading organization and they tweeted out some pictures where, you know, they're, they're they hired a bunch of folks to start a jump and they did a coding bootcamp on Solana. That was their onboarding as an example. So when you have people in- ***** you know, really vested in this thing and you have $3 trillion of value that will go to 6 trillion and then go to 10 trillion, this can't go away. So that's why I think Powell and Gensler had to say some version of that on the record. Which is, you know, we're not going to ban this stuff because they know it's not possible. So I think David's right. You have to create some rules, make folks, and let folks pay their taxes. You know, I remember, for example, like, I did this Bitcoin transaction in 2014 or something. I bought some land, I used BitPay, I transferred some Bitcoin, bought the land, blah, blah, blah. And I was like, you know, whatever. But then whatever. Yeah, I mean, I, I, I, I I left. I mean, I I owned a lot at the time, so it wasn't that big of a deal. But my point is, finding a way for me to pay my taxes was a huge deal. I remember. And, you know, we filed the tax return and we tried to make sure that we paid our taxes. These are very complicated, even if you want to be conformant to the government. It's impossible right now. So they just need to create some rules where folks can say, here's what I own, here's what it's worth, tell me how much I owe you, and we're all willing to pay or not. Maybe we're on. I'm, I am, because I just think it's like, make sure that we can, we can trade around it, hedge it, structure it, do the things that we would normally do with any other risk assets. Right now that's very hard. And when you own lots of this stuff, it sits in your balance sheet and you just take these enormous swings and you're just like, God you can't do. Anything around this stuff, and that's not a viable financial market that doesn't. Yeah. To be specific about against, Lower said. I just looked it up here, you know, he compared utility tokens with, you know, laundromat tokens or tickets to the opera. And he said entrepreneurs are choosing to perceive their tokens as utility to sidestep regulation. And that, here's the quote. They are highly speculative investment tokens for people who are trying to save or speculate for the future, their future. And that's why I think it's appropriate to bring them inside the investor protection. Perimeter, I agree with him. I also agree with you, chamath, that this is a can of worms that I don't know how you put the genie back in the bottle, but he's he's partially right. I mean, he is partially right on some tokens, but he's not completely accurate on some other tokens. I think it's on a case by case basis and it depends. Listen, I think anybody who is buying these tokens right now knows that they're engaged and in financial speculation, this idea that people in Middle, Middle America are going to blow their retirement savings on crypto. I don't. I just don't know if they know. If they're doing speculation, then it should be a security. No, no, no, David, I think you're totally wrong. I totally buy it. Look at the quarterly returns, the filings of earnings from companies like Robin Hood and how much and square and how much money they make from crypto, and look at their audience. That's totally not true. But don't you think that audience skews really young and they're getting their, like, COVID stimulus check and they're following it into meme stocks or crypto? What does that have to do with? Well, because you're making it sound like they're gonna blow their retirement savings. OK, well, if you're talking about a 25 year old who's got $5000 of retirement savings, maybe. But they still got, you know, they still got 40 years of work ahead of hold on a second. Wait, no, they don't. This is going to be the least hard working generation of our lifetime. Why? No, no, not not because you're not hard working. Why? There's $70 trillion that boomers have that they are about to pass down to these folks on average between two and three trillion a year for the next 30 years. Also, they know how to do gig work like they're so smart this generation. They know how to do projects for five grand and float themselves. You're gonna take one entire turn of the world's GDP and give it to 100. Billion people in America over the next 20 to 30 years, that is what is actually going to happen. So, yeah, look, I think, I think, of course, they're gonna keep yoloing this stuff. Yeah. Look, I think, I think we're getting off on like a little bit of a tangent here. My point, my, my point is not that there shouldn't be investor protections, but rather that I think we also need to balance another important objective, which is to create a hospitable environment for innovation. And the fact of the matter is that you've got a lot of brilliant young entrepreneurs. Computer scientists building this financial infrastructure of the future. With crypto, it's not just speculation. There is a lot of code being written. It has functionality. There's a purpose to it. We don't. We don't necessarily want to interfere with that. To to the every story has to do their securities though, David and all the other startups that are not encrypted or playing by the rules. So it's crypto, people get a pass. It's unfair. I agree with Jake, help people make this claim and I just think it's so specious. Do you think that you would have made a single professional decision in your life based on tax rate? Have you ever made a single, like, I'm going to start this company, I'm going to make this product, you know, I'm going to change this job. I just think that most people talking about paying taxes, I think it was smart for, for example, Solana to pay corporate taxes on their token sale. I'm, I think everyone should pay their taxes. That's not we're talking about here. And I'm not saying that counselor shouldn't prescribe regulations. I think that part of the purpose, regulations should be to give entrepreneurs predictability, to be able to give them a safe harbor so they can build what they want to build. Let me make one final point. I'm just saying from my perspective. I just think that if you have clear, sensible taxation, that's 90% of what this industry needs. And I don't think it will, it will change anybody's real motivation to work inside this ecosystem. I agree. Just like just like entrepreneurship doesn't change when capital rates, capital gains rates, I, I've, I've paid, I pay taxes at, you know, on on my crypto sales like it was any other investments since the beginning. But that's not the issue. The issue is when you're a company and you're raising money, should you be allowed to not follow securities law? Because you say it's a token Friedberg. When you look at this. An NFT company came out last this past week that was selling shadow shares in startups and anyone in the world could buy a shadow share in a private company like Stripe, etcetera. In this Fantasy Football League. They wound up shutting it down or changing it because they didn't want to trade on other people's intellectual property. They were concerned about that, but just looking at it. The public in America, 96% of them who are not accredited, cannot buy shares of Stripe in the secondary market. But you can buy NFT's in it and speculate on the NFT's which are accelerating from you know $1000 to $500,000 in these different clubs. How is it fair that crypto companies get to not obey basic securities laws? Friedberg well it's not a security, there's no underlying asset. OK. So collectible and NFT is clearly a collectible jakal, OK. And I don't have any legal legalization of them and have a marketplace for people to sell them and they're appreciating. I mean, I I do agree with something different. Sounds like art to me. Yeah, you could go draw a piece of a picture of stripe and put it on a piece of paper and go down to downtown wherever and stand in front of the burrito shop and try and sell it to completely different than a security, but they're acting as securities in relation to the fundraising of these projects. So I think that's the challenge. Everything is a security. Yeah, there's no secured interest. You don't have any secured interest. It's literally just a a like an image, a figure. I was just offered a jacobetti sculpture, but I turned it down. How much? 60 million if not going to comment on the price. Even Cohen selling it. I'm not commenting on the seller. I bet Steven Cohen was selling it. That was the record deal. If Stephen Cohen bought that Giacometti sculpture a few years ago, it's like the highest price ever paid at auction for piece of art in the US. Can I, can I just tell you my problem with with it? I I took the price and I divided it by the height in centimeters and it just tilted me. Is price per square inch of metric and it is in my head. In 2615, Stephen Cohen paid $141 million for the Giacometti sculpture loam Odo Oduye. Pretty incredible, and I think you're right, it's about 12 inches tall or something. That's like, you know, if you look at the picture, looks like it was done by a 12 year old. Oh my God. Stop. Jackal. Jackal. You're gonna stop. Yeah. This is a billionaire equivalent of of of crypto and NFT's, right? I mean, I don't know what this guy is running, but that looks like anyone can raise their hand and say, I have an independent objective assessment of the value of anything in the world, and you can look at it from high to low. And this is all effectively subjective. Looks like it was a culture that was in a giant fire and that somebody pulled out of the ashes. It's a beautiful piece. If you want to read a little bit of art history, yeah, you can understand a little bit about jackets work, but it's it's a 70 inch piece, not 12 inches. Sorry. And Umm, yeah. His work is all about kind of like how do you capture the essence of the form anyway? This is a super ridiculous functions like somebody made something out of money, put into a clay oven. I have a very funny Stevie Cohen story. So this is like 10 years ago at Art Basel in Miami and the day before the art fair opens, it's called the massage people. And so, you know, it's like a day where you can go and see the the stuff the day in advance and you can, you know, kind of buy stuff or whatever and. It's very funny. It's kind of like a. You know, like when Walmart does like a Black Friday thing, like everybody lines up and then they open the doors and we all run in. And I was standing side by side. We were right at the front of the line. And I noticed that he had these, and this is my first time there, and he had New Balance running shoes on, and I thought, what is he doing? But then when the doors were open, they just took off and started running. And I was walking wearing normal loafers. And then I realized I should have been running our own normal loafers. You were wearing Italian loafers. I missed out on a balloon dog guy. That's like the it's like the running of the Bulls. I just thought it was, it was, it was the running of the Bulls. I miss out on everything. Running of the billionaires. I got to the things after and I was like, oh, sorry, I sold it to Stevie Cohen. I sold this. Jesus Christ, I had blisters on my feet. It was brutal. Do you guys know we haven't even started our agenda? No. What was the brain? ******* moderating. This 32 whistleblower hearings occurred. Yada yada everybody. Everybody. Welcome to the. Let's start our show. I'm sure everybody by now has seen Francis Hougen on 60 minutes and testifying. She seemed incredibly credible, well spoken and had very common sense, non extreme views about what should be happen, what should happen with the research that Facebook has been funding, that shows like other media forms. Instagram and Facebook have a a really terrible effect on young people specifically. Young girls and body dysmorphia, which seems to be the one thing that is landing pretty well. Her suggestions were not to break up Facebook. Hers was to have a regulatory body and to do soft interventions. If you don't know soft interventions. Her her suggestions were worse than breaking up Facebook. Well, soft interventions. Let's get to that. Include things like, hey, in order to retweet the story on Twitter, you probably should read it first. She thinks she wants to reform, or she's an advocate for reforming section 230 in relation, I think, to the algorithms. And the idea here would be that the algorithms are making an actual editorial decision, which is something that I remember in the YouTube early days. They said we will not feature your videos that you're making, but we will have the algorithm pick them because that keeps our Safe Harbor, Zuckerberg. Came back and wrote a spirited defense basically saying why would we do this research if we didn't care? The people at this company care a ton sacks and the entire Peter Thiel cobble of. You know acolytes and friends are coming on strong as, uh, pro Facebook. I'll have him talk about that. He thinks it's a Facebook. It's laughable that people are. Addicted to Facebook, yadda yadda. So who wants to go first, you tramp or sacks? Well, look, let me let me say a couple of things. I think that I think zuck's the title of Zuck's internal company post could have been titled Nara, which basically is was this what I'm saying that this is ridiculous and I don't believe it. The the thing that she asked for in substance is a little different than what the DOJ. Did with Microsoft in 2000, but in form is actually quite similar, which basically is like gumming up how the internal product development would work inside the company. And you know, the most damaging thing you already saw, which is that they had a bunch of planned product releases and then they put them on ice. And I think this is really. Where unfortunately. That most damage gets done because engineers won't really tolerate that for some amount of time, right? They'll put up with it initially. But you know, you've had, I don't know, I think like a 20% reduction in stock price. So you had, you know, you lost $200 billion of market cap. There's probably going to be more turbulence in the company. You can sustain and get through all of it as long as the engineers hold the line. But if you basically slow down and put a pin in their ability to generate code and to put out features. On the margins, enough people, I think, will get frustrated and leave. And I think the way that she, you know, what she is asking for was tantamount to that. And I think that's the really destructive part of of what could go on here. So they need to get this pinned down quickly, get in front of regulators, get some laws passed, whether it's section 230 or whatever. That's the path to salvation for Facebook sex. What do you what do you think? I see, you're basically saying this is like ridiculous and silly on Twitter. Mike Salon is saying that. Obviously Peter Thiel's on the board of Facebook and you're gonna have to give me time to unpack this. Jake. How about getting hysterical? Because there is, there's a lot to cover here. I want. I'm I'm literally referring to you in a non historical way. You think that this is, there's nothing to this for? You think it's ridiculous? Let's understand what this really was, OK? You have this so-called whistleblower who is working with the staff of the Senate Judiciary Committee giving documents to the Wall Street Journal and then appears on 60 minutes in this great unveiling 36 hours later. She's testifying on Capitol Hill. That does not happen. The Senate committees do not operate that fast. This was coordinated. She's got a Democrat, a well known Democratic operative named Bill Burton working for her. She's got a team of lawyers. She's got a PR team this morning. By who? This is a coordinated hit, OK, by anti Facebook forces, starting with the Senate Judiciary Committee. Who want to regulate who? She's working on the staff. Jason, you're interrupting. I'm asking you who you said. With someone and who it is, just let him make this argument and then just stop. Let I want to hear what he has to say. OK, what is the purpose of this testimony? First of all, we can go over the details of what she said. I don't think there was anything new here. This was all the same arguments we've been hearing from these same sort of forces. You want to regulate Facebook, whether it's the whether it's the senators on the committee who've hauled up Zuckerberg no fewer than four times to lecture him about the need for more censorship, or it's these forces of the media who basically want Facebook, it's all about, you know, having more censorship. But in any event, there was nothing really new there. What this really was was corroboration. And of of of the same talking points have been hearing for years and where and what it's all leading up to is there's a very important part of her testimony, which is this is really the crux of it is that they that she proposed and what Blumenthal wants is the chairman of the Senate District Committee is a dedicated oversight body. This is in this clip, OK with a power to oversee social media platform. So what we have here is the government is now going to have a new agency. They're saying like the. RTC, then, she said. A regulatory home where somebody like me could do a tour of duty after working at a place like this and and. Hogan said right now, the only people in the world are trained to analyze these experiments to understand what's happening inside of Facebook are people who grew up inside of Facebook or Pinterest or another social media company, basically people with her experience. I mean, I have to admire the hotspot. I mean, she's basically proposing that she be made Zuckerberg's boss, OK? That a new oversight board be created by the government, which she would be appointed, to which she presumably would run. And this board is now going to prescribe regulations and rules for social networks in terms of how their news. Is going to run. That is what was proposed on Capitol Hill. That is what this operation is all about. So it's about her getting a job and being lording over Facebook is your claim? No, I think, I think, I think, I think the purpose of all of this is to create new regulatory oversight of social networks. I simply would note that she has proposed herself as somebody who would be on this board, which is pretty amazing. But what this is really about is that new oversight power and is that a Republican or a you? Are you insinuating? Democrats who want to regulate this, or all politicians want to regulate this because they're scared of Facebook having too much power, which I think we all agreed Facebook has too much power. In in the public, you had the leaders. You've had the leaders on the Senate Judiciary Committee now for months, calling up Zuckerberg and Dorsey and other social media leaders and basically lecturing them on the need to censor more, to take down more material. That is their objective. This is not a conspiracy theory on my part. This is expressly what they've said, OK, now until now, is left or right or both, we come to that. I think the Republicans are a little bit confused on this issue, but we get to that. So what you've heard until now is is that. Is is a tax on the supply side of the platform. So what they've advocated is deep platforming people with heterodox, heterodox views, dissenting voices. And they have been. Deep platformed in large numbers. Obviously it started even before Trump, but certainly the sitting president United States was deep platform. YouTube just took down a million COVID videos because they disagree with official position on COVID. So until now, the censorship has been on the supply side of the platform. What they're advocating for now is censorship on the demand side of the platform, which is we're going to rewrite these news feed rules, OK? We're going to rewrite them because we can't give people what they want. The the They're making these algorithms sound like they're these incredibly evil, sinister things, all the algorithms. You, at the end of the day, is give the user more of what they're looking for. OK, hold on a second. That is not good enough for these politicians. They want to rewrite those rules. What they said they want to rewrite these rules to determine what people see. What they said about the algorithms was that the algorithm had a multiplier on it and that this multiplier of people resharing it. Reengaging the content would lead people. And this was statistically proven in Facebook's own research that things that were either misinformation. Or that we're supercharged, uh, you know, uh, polarizing issues. They would rise quicker, which then gave people not what they wanted in their feed. They gave people what would increase the length of a stay on Facebook or on YouTube or on Twitter for that matter. And they think the antidote for this is to maybe not allow things in the algorithm to go viral. Because what you're doing is saying things that are either misinformation or polarizing or will make things go to the top of the list. And maybe we don't want that. As a society, let me intervene with a with a point of view on this, because I think your head you're headed down a path that. To me, I I don't think actually speaks to what's really going on. It sounds like there's some sinister architecture, you know, architecture here that's driving this outcome. I never said that. Yeah. Well, I mean, it's implied because it's like, Oh well, they're they're multiplying sinister stuff. What I'm saying, they're just care about length of stay on the site. My belief is they just want it to care about revenue because that's my exactly my point, Jamal. They they care about what consumers want to consume and consumers demand what they want to consume. So think about media in the old days, right, we used to have books that an author would put out every year. And so the author would get feedback on the book. And so it would be one year on that feedback cycle. Then magazines would come out, magazines would come out every month. So every month, the magazine would get feedback on what sales were, and they would make decisions, editorial decisions, and they would iterate. TV shows came out every week, newspapers came out every day, cable TV came out every hour, and they could adjust their content accordingly. In the Internet age, the media is getting a much more kind of instantaneous feedback cycle, and the call it publisher or editor or curator of that media ultimately ends up putting in front of the consumer more and more of what they want as a function of what they're choosing to watch and what we're calling. Kind of. These algorithms, quote UN quote, are really just the same thing that editors and publishers and others have done in the past, which is looking at what the consumer votes by, what they choose, making decisions to put more of the things that they want in front of them. The consumer consumes more of that. And here's what's messed up. We're getting a very ugly look in the mirror at what humanity and what citizens and what individuals actually want to consume and choose to consume and get turned on by. And that is what's making this also ugly. And when we see that, we don't like to accept the fact that maybe that is just. Where humans are attracted to him, what humans want to consume at scale, and we end up wanting to blame someone. And I could argue, and I think others could argue, that these algorithms that are effectively just recursive optimization functions, they're recursively trying to figure out what do people want to consume and then giving them more of what they want. You. You keep saying that, solving for those very specific needs and and use cases and and and I don't think those algorithms are good truth. Why is it not want I? I'm interested in that, unpacking it. Everything free, Brooks says. It's absolutely right, but it's not the word want. It's not what they want. It's what they will react to the most. Hmm. And sometimes what they react to the most subconsciously want, I don't know. But my point is that there's, there's a I guess I don't I don't use Facebook, but they went from thumbs up and thumbs down when I was there to like this nuance. Like there's likes, there's tears, there's angry shares, but there's also, like data on engagement, right? Like on how long someone's watching a video. Or what I saw in there was that there was an amplification of things that were more. Extreme emotional reactions right now and and the point is that I think everything you said is absolutely right. The algorithms are amplifying. I think all I would say is I would restate what you're saying is these algorithms tend to amplify the things that are the most extreme and elicit a reaction. Yeah, those reactions aren't necessarily the things that you want. Those are the things that you will react to the most. And by the way algorithm wants to serve. That's why you see that the top 10 things that are reshared the most often tends to be very extreme. Right. Fundamental emotional responses are typically associated with things that I think we call hedonism, and the things that you can ignore your emotional responses and take another course of action. We typically call altruism or or what have you. This is a kind of a common reason why people would want to watch a comedy or watch a horror film, because there's some emotional response. It's not a universal response. And people aren't rushing to the theater to watch documentaries. They're not rushing to the movie theater to be like, oh, I want to be informed and educated on something that's factual. And interesting, they wanna go and have emotional experiences and that's how humans are biologically wired. And the same is happening in these short forms of media. These little tweets or David Post do understand that they won't show murders and **** on Facebook. So they're making an editorial decision to say, hey, we're not going to include every night on the local news. If it bleeds, it leads that. How long has that been the motto in media? So I'm listening, I'm listening to Hogan on 60 minutes. I'm hearing her describe a corporate profit making machine. That tries to get more reach more ratings by fueling polarization and division. And I'm thinking, is she talking about cable news? That's what she's talking about, isn't she? Is she talking about the New York Times? Is she talking about traditional media? Because every single thing she said about how social media fuels polarization and division applies to the media. And yet those same voices in the traditional media are the first ones howling about Facebook and calling for its regulation. It is completely hypocritical, because the real purpose here is not to reduce. Divisive Mr polarization in our society. The regulations on Facebook will not do that. It is to seize control and influence over the machinery of social networking. Why? Because the news feed now controls the flow of information in our society, don't you think? The damage has been done though. Meaning in the sense that if you cripple Facebook's product velocity. And you shrink the surface area of the areas in which they can operate. Isn't that more damaging than any regulation? No. People will just stop using it and then they will find another place to get that same emotional support. I've already stopped using Facebook. OK, I don't find it compelling at all. And I'm not really on Instagram either. I I do find Twitter rather compelling, and I'm probably more addicted than other things. Yeah, exactly. Off the rails. Probably not very good for me. OK, but, but but here's the thing. I think, I think all of us on this show right now, none of us find Facebook particularly addictive in our own behavior. OK. I think we understand in our own behavior that Facebook is sort of like a mildly diverting amusement that occasionally yields information. Sometimes it's useful. OK, we understand that. It's sort of like a news for you with a lot of noise, OK, in our own usage. But somehow we've bought into this larger narrative that in everybody else's. Usage that somehow this is a brainwashing machine that is pumping people full of disinformation and warping their thinking. In other words, there's a sharp dichotomy between how we perceive our own usage and other people's usage. And what I would submit is our own usage is what we know and what we know to be true. And what we believe about other people's usage is simply a narrative that's been fed to us over and over again by the traditional media who hate Facebook because it's just remediating them. That is what's really going on here. You may, you may be right. No, I'm saying something different, which is getting apart from all of that stuff. What's happening practically on the ground right now is that is a company who has to now slow way down. And what I'm saying is that's not dissimilar to what Microsoft had to do, which was there was this 10 year. At Microsoft where they really couldn't innovate and that's really how the government solved the Microsoft problem. Yeah, they they made them less aggressive, right. They gummed up the internal machinery so that Microsoft couldn't really be there for the next few major. So for example, we just spent, we just spent 40 minutes talking about crypto. What do you think the chances are that, you know Facebook now can land a really compelling crypto project? Yeah, it might be totally shut down with Libra, right? I mean they went after it and the regular news stepped in and the students involved for them to launch that after what happened, it's it's zero. You know, with their behavior and other arenas, I think that like Microsoft back in the late 90s, I think there are are real and legitimate concerns about the power of these big tech companies, about how power, how big and powerful they've become, about their ability to crush competitors. I think that those are all legitimate and in a weird way, if this government scrutiny slows those companies down. That's not an altogether bad thing, but I am concerned about that. I'd say separately, just because these companies do deserve to be scrutinized more, I do think that we have to see that the people who are engaged in this really coordinated hit campaign against Facebook, they have other they have another agenda, and that is to control the flow of information online. It is to control online discourse. It's already been happening over the past year with censorship on the supply side of the news feed, and now they're trying to control the demand. Right. I think we have to be extremely wary about this. Well, David, isn't you. You've been on the other side of this cause. On previous podcasts, you've talked about Facebook being too influential, having too many users. And now you're saying, well, these tiny little news networks that get a couple of low millions. He has a he hasn't issue Jason with the way in which they're going after Facebook. OK, I get that he thinks it's a coordinated hit. Fine. But you also have had an issue with Facebook having too much power. To take somebody off the platform or to promote certain ideas? Yeah. So which is it? It seems like you're a little bit both can be true. No, it's perfectly. It's it's it's no, it's perfectly consistent. I've expressed concerns about the way in which Facebook is, is deep platforming people. It's Samara summarily silencing them and ghosting them. It's it's engaged in censorship. I've expressed concern about that, but we should understand that the people in the Senate Judiciary Committee who hauled up who had this hearing, who featured in spotlight and Hagen and turned her into this great hero, their agenda is even more censorship. They they are complaining about the fact that Facebook is not censoring enough and that is what their real agenda is. I I do think it should have been disclosed at Haggen does stand to gain financially from whatever happens? You know, I don't know that that's being. Confirmed that there is a whistleblower reward here, so we'll have to wait and see about that. I haven't heard there's no reward until there's a fine, but you're right is right that she qualify. If she's a whistleblower, she qualifies for what a 30% portion of or some very large percentage of any kind be here, though? What would the fine be? How would that be framed? Chamath, this whole thing is just getting started. There are gonna be they're gonna be actions, and there will be settlements from those government actions. And the and Facebook, as you all know, will pay any kind of fine to put this. You you're the one that said, Jason, they they spent 5 billion just so that they wouldn't subpoena zucchero, right. That's what you said last week. We talked about that last week. Yeah. So I mean I I think there's a fine coming. Let's, let's let's be honest. I I do not think Lena Khan or Gary Genzer or any of these other folks. Are going to be in the business of making a quick decision. Nor the DOJ, nor any of these other folks, they're going to want to really take their time to figure this out. But what I'm saying is it's not the ultimate result of it because I, again, I go back to like, if you look at what happened in 2000 and Microsoft. The substance of what Microsoft had to agree to was was ultimately not as bad as the way in which it was implemented, which is that, you know, my understanding was like Microsoft had to submit feature reviews to lawyers at the DOJ who would then approve, you know, updates and upgrades to their code base for things like Windows. That's what caused them to miss an entire wave of compute. And so this is the this is the point which is I think practically speaking, at the beginning of what Microsoft went through, Facebook is going to have to navigate and so the faster they can try. To say, all right, folks, you're right, you caught us. Let us tell us what to do. Maybe actually the the better path because it allows them to get past it, because the longer this this this period of like Gray stretches out, I think is is actually the worst outcome. Well, let let's go through what we each think would be a possible solution here. To allowing free speech to occur on Facebook, but maybe not having the things that you know fake news, you know, misinformation, you know, maybe lowering down the rhetoric and the charge nature of the algorithm freeberg. Do you have any common sense solution here that might? Address both sides of the issue, freedom of speech and. Maybe things being amplified to 100 million people that are fake and and just simply not true. We've talked a lot about this notion of like decentralized social networks. I mean we haven't talked a lot, we talked a little bit about it, but if you end up putting a regulatory hammer down on Facebook and Twitter and telling them what consumers and remember these guys aren't media creators, they're platforms effectively for search, discovery and access. So you as an individual can discover third party. Content on their platform, if they start putting the regulatory hammer down on these quote UN quote platforms, telling them what they can and cannot make available to their users, there will be another platform that will emerge and that platform may end up being in this kind of decentralized model. And in that decentralized model, you're not gonna have the same degree of regulatory oversight and that system will end up solving the same use case. Eventually consumers will get what they want, which is, you know, what your mouth calls kind of this emotional response is eliciting this emotional reaction. They will consume it. Until they, you know, achieve one of their kind of seven deadly sins objective, which is what's driving the emotion, underscoring their decisions on what to watch, what to consume. And, and there will be an alternative. So, you know, go ahead and play whack a mole. You'll play whack a mole for a few years, maybe a few decades. But at the end of the day, digital technology and a connected world will drive consumers to exactly where they will naturally find themselves, which is consuming ever more of the things that create this emotional response to them. The consequences are unfortunate. You know, I don't know what the right solution is. You know, we we've, we've to some degree put a regulatory hammer down on things like smoking and in some places things like sugar, things that have kind of a, you know. An obvious effect on our physical health. These other things that we're seeing now are having an effect on our mental health. And I think that there may be kind of an emerging regulatory regime around mental health standards and how much of things can be consumed. And I think what we're seeing is the leading indicator of this is what's going on in China, because China is the nation that I would say is probably at the forefront of research and understanding of what the consequences are, of consuming more and more of media and content that. Causes an emotional response to you and what happens down the road? Isolation and loneliness, suicide rates go up, unhappiness, etcetera. It certainly is the consequence, but it's not a function of any individual companies Miss conveyance of content to consumers. It's just a function of where these systems end up going because of the way humans are biologically wired. And so I guess my my first concern is maybe we end up in a decentralized system that ends up replacing all of these tools and this just doesn't end or you end up having or you. It could be worse, or you end up having these kind of regulatory regimes emerge. That would be better. A decentralized solution is actually no better in one. No, it's better in one key way, which is that it's fundamentally harder to create the exact same network effect and density that you can have with one monolithic closed system. So you you're much more likely to actually have a very fragmented ecosystem of hundreds of different solutions depending on what of the sins you want to feed or, you know, what of the feelings you want to feel at any one time. I think it's a big assumption that it would be a fragmented network if you did replicate Facebook on a decentralized platform. And then some piece of misinformation came out and a trend it all the way to #1 like, say, the January 6th insurrection. And no, there's not going to that. There's not one network. There's not understand that. But if one. Now hold on, hold on, let me finish my point. If they if one network became so large and there was nobody who could turn off something, what if people said, hey, there's a riot going on at the Capitol and more people showed up with more guns, right? You have nobody to sit there and say, hey, don't go to the capital. Turn those trending posts off. Go ahead, sacks. OK, so let's let's talk about this problem of misinformation, OK, I think there's an old Mark Twain quote saying that the a lie can travel around the world faster than the truth can put on its shoes. OK? There is a problem of falsehood spreading online. I agree with you there. The question is what you do about it. And the problem we have right now is that is that truth is in that by either beholder. There is no truth API. And so at the end of the day, it's the people in power who get to decide what is true and what is false if you give them the power to censor misinformation. Example we just saw we talked about in this program, the Rolling Stone ivermectin hoax. Provably false story. And yet Rachel Maddow still had it up on her post. She was not sanctioned by MSNBC, Twitter never told her to take it down, and she was not fact checked. However, the Hunter Biden laptop scandal or story which came out in the New York Post a couple weeks before the election turned out to be a provably true story, and yet it was taken down by Facebook and Twitter. At the end of the day, this term of misinformation is just another vector for partisan attack, and it will be used by whoever we give the power to, to decide what misinformation is. So what is the answer then? At this point of falsehood spreading online, well, at the end of the day, the answer to bad speech is more speech. You try to create a free marketplace of ideas to let to let the good speech ultimately. Drive out the best feature, proof that it's wrong. That's the best you can do. That's the best you can do in a free society? Yes. But we've this is the first time a free society has had social networks that can reach a billion people instantly in in, you know, an hour. So I think there's one differentiator there that we must think of. If somebody defames you on a social network, they are absolutely liable. I mean, you can sue them, OK, but I think it and you should and I think we can. We've talked about cancel culture. People are destroyed before they even get their day in court. I think, I think that's being destroyed for something different. I think if somebody but it's because it trends, if it didn't, if it couldn't trend to so many people, it wouldn't leave lead to the cancellation and destruction of somebody's life. You've talked about that many times yourself. If if somebody libels you, I think they should be, you should be able to sue them. And I think we could actually, we could have a libel regime more like the UK where it's easier to prove these cases in court and people are much more careful about defaming other people. I would be very much in favor of that, OK. Because defamation is not free speech. But the question really is about really we're talking about non defamatory statements that somebody in a position of power has decided is not true. Many of these statements are subjective. Dave Portnoy got labeled for his subjective opinion about AOC's dress. Why did that happen and why is that kind of labeling only used to protect one side of the political spectrum? So I mean that that that's what's really going on here. Let's end with this. Has anybody watched Chappelle's the closer? I did incredible. I I watched it pretty incredible. I mean fearless. Fearless is a word. I was really. I think that he. Slightly missed it. Because I think he could have really actually called out cancel culture and localism more. I think he kind of left it a little bit to me where I was like a little. I don't know. I just, I just didn't think they were as good as his other ones. And I felt like he didn't really make the point he wanted to make. It was a little convoluted, somebody who can actually stand up and and and actually, you know, be more satirical and tell the story of why all this cancel culture and defamatory statements and judging people doesn't make sense. But did he seem he didn't. He didn't get the job done? I felt, well did let me ask you this about the performance. Did he seem qualitatively different than you in that the other times he seemed very light on his feet. You know, having a good time being a comedian and this time it felt like he was personally hurt or he was, it wasn't comedy, it was less. It felt less comedic. I agree. It felt like he had an agenda. He was hurt. He wanted to get some stuff off his chest and there was some jokes in between, which is very different, like the percentage of jokes, and this is like 20% and the like heavy on Max, Max. And then the other ones were 80% jokes, 20% social commentary. This felt like. He he was actually really hurt and like, I don't wanna say bitter, but just fed up, maybe frustrated. He had a chip. Which made it interesting to me. You know, in the in the early 2000s, Chappelle for me was really important because he was an advocate for minorities and I felt seen and protected by Chappelle. And. And I thought that was really important. And then his his comedy was just so sharp. Oh yeah. And I, I said, I just think that it was a little bit of an opportunity lost. Yeah. I I think if he had really actually taken the, you know, it to its conclusion, he would have actually. There was just too many uncomfortable moments in that thing, and it was super uncomfortable at times and. I, you know, I really would like to see it again. Because, you know, if you just think about his career, you know, him talking about police brutality, him talking about race in a very fearless, you know, entertaining but also informative way and and just being a truth teller. Yeah, this was so uncomfortable at times. I agree with that. I need to watch it again and I need to let it sit because I would take it. It's on Netflix. It's the last. For how long? Yeah. I mean, this could be, I almost felt like he was trying to break Netflix because he does seem to have a. He does seem to have a streak. Him where he's like, OK, I'm going to. I'm walking away from Comedy Central and he does seem to burn the boats. This felt like he was burning the boats with Netflix to me. I don't know if you got that vibe where he was like, this is the last one. I'm being cancelled after this. **** you all, I'm out and he has that. I mean, he torched it, sacks. I mean, you're going to watch this thing on? I'm definitely watching it. I I have not seen it yet, but I'm definitely watching. I'll watch it tonight. I give it a 50% chance that Netflix takes it down. Well, let's watch it quickly though. They're there. Everybody was screaming for him to be deep. Informed everybody was screaming. Well, then I I like it even more. You know, one of the ironic things about these warning labels, I've noticed they've started to become a badge of honour where, you know, if if if the if the hall monitors at Twitter are trying to label your tweet as as, you know, being incendiary. Maybe it's just interesting, right. I mean, it's a buy signal. It's a yeah. Exactly. So, you know, I was listening to Antonio Garcia Martinez interview Camille on on call in and they they labeled. That, I mean just the post about they were going to have a conversation. You're saying the link to it was even flagged as like, Oh my Lord, I think there needs to be a Netflix for a comedy where it's only subscription and it's owned by the comedians. Like, if Dave Chappelle were to create his own Netflix, I think it gets 10 million paid subscribers over the first two years overnight now, overnight, overnight. OK. So wait a second. How do we wet our beaks on this? If we go to Chappelle and we say, hey, listen, here's $25 million, we'll set up the tech team. I'll ask heart. I'll ask him this weekend. I think that. Yeah. You get K Hart, you get Chappelle, you get Seinfeld, you get now do you get Louis CK in there or CK, what's his name? Never found that guy funny. That guy never did it for me. I mean, anyway, you know, it's funny, you know? It's funny. Have you have you had this Asian guy, Ronnie Chang? He's on. There's a great Netflix special on him. He's ******* funny. And then Joe Koy. Joe Koy is very funny. Yeah, I think Ronnie Chang taped his own. Jason minhaj. That guy's very funny. He's great, he's he's legit. But I mean I this would be a great way for them to just control their destiny and not have to worry about cancel culture. Because I think a lot of the folks who are on well, they are probably the the last line of people that actually. Will be the defenders of free speech. Yeah, it's pretty scary. As much as I think Facebook should be more thoughtful about their algorithm, you know, back to, you know, circling Netflix and censorship back to the Facebook issues, I just think Facebook should say, hey, listen, we've throttled the algorithm so that any one piece of content can only reach this many people over this period of time. And yeah, sure, that's going to lower our time on site or whatever, but we want things to have a little bit of time to spread and get fact checked. Does anybody think that that's a good idea to say just, you know, if you're trying to cancel somebody instead of it going to #1 on trending topics before the person has a trial, the algorithm would just take a little bit of time to propagate content. Here's what I can tell you conclusively if Facebook wanted to solve these issues in the ways that the government. Expects in their head for these problems to be solved. Facebook market cap would be $250 billion, and they'd have a million people working there with the company, so this is not an issue of whether it's possible. The question is, is it right, and does it actually get it the solution? Or does it just, as Friedberg said, create whack a mole someplace else? And so, you know, I don't know what obliterating 3/4 of a trillion dollars of market cap will do, but I suspect that the government is going to want to find out. Saks, you think that throttling the the velocity of the algorithm so that news doesn't spread as fast and violently, which could be misinformation, could be valid information? Do you think that's a possible solution? Look, I I think that at the end of the day we're just closing the algorithm. Maybe with both Facebook and Twitter you only see stuff from people who you're following or your friends with. It's actually not true. What do you mean if things they will insert stuff into your Twitter algorithm now that's adjacent to you and. Facebook will do that as well. Maybe. Maybe if people respond to someone who you're following. But I've never seen anything my Twitter feed other than an ad that's not from somebody I follow. So what? They're trending topics. No, I mean, not my feet. Explore fee. OK, no, but you, the explorer feeds right there, and they are surfacing things in your feed now that are not people you follow. But anyway, keep what they're really doing, OK is there's a universe of people who you're following or your friends with, and you could just see all of that content in a reverse chronological feed, but that would be too much. It'd be overwhelming. Originally worked. Yeah, exactly. And I get it. And that was fine. I didn't. I liked it. OK. But as you're following thousands of people now, there's too much content, and so they will simply surface. The tweets that you're most likely to want to interact with, I don't believe by the way, that those tweets are necessarily the ones that make you angry. I think. I think for some people it is clearly, but it's not certainly not the case. In my case, what I would say is it's more refined than that. It's the tweets that you think are interesting. It's the tweets that perhaps express a sense of outrage that agrees with your sense of outrage. It's a little different than anger. But it's it's basically the subset of content that you, through your reveal preferences have have shown Facebook or Twitter that you know that you care about the most. And that's basically what they're doing. They're giving the consumer more of what they want. And I think that we've blown this thing so far out of proportion. I mean, yeah, if there's an analogy that it's addictive, but I think that it's been blown so far out of proportion, we've exaggerated the fear beyond any reasonable recognition. By the way, I think the I think the reason that that tweet was flagged, I'm guessing, is that in the tweet Camelle says he's going to talk about critical race theory, and that may be why. Because it was linked to the order, just said this. Conversations like this can be intense, that's all, I think, because he says the gloves are coming off. It looks like people fighting or whatever. I just think it's sort of ridiculous, you know? Like this is where like the warning labels are. It's a little condescending. Internalizing. I think the patronizing. Yeah, exactly. Yeah. I got the thesaurus up here. I'm not dumb. Hey, thesaurus here. I'm gonna marry. It's a very palindrome. It's gonna look out for me. It was my brother. Changed it a little like that. Like, you know, Panda. I'm smart. Not like they say no, Tom. Did you get your ******* shine box? Bug voice, I love you. Happy 50th episode and what's going on with you, freedberg and sacks that you're you won't make the journey down to the poker game. Is this like some sort of David? Protest here, why don't you? Why are you playing no limit? Testing, I will come back, I will. I will start playing again. If we get, if we get the game going on like a regular time or is it what the **** is on your side? Are you talking about it going on? OK, yeah. You have nothing going on, sacks. Alright, I'll start. You know, I'll start making. I'll stop evading your family. Stay in the city. Come. See your ******* friends play some cards. There's some money. We're not playing PLO. Yeah, no PLO. I mean, we did at the end just to get Skype money, but just to keep this guy there for another 30 minutes since he was flushing. Casting was real good. Sexy poo. We beat him up real with Skyfall when you crumble. Actually, the new. I'm really excited to see the new Daniel Craig 007. I can't believe that. Can you still rent a movie theater for like 50 bucks? Yeah, 300 bucks. So yeah, it's based to be not. It was 99. During the pandemic, it was awesome. I did 300 now 300 done. At the last two times I went with the girls because it was first run, movies in the theaters were pretty empty. But it's like 300. If you get like 10 of your friends to come, it's like basically some of your friends to come. It's worth that. I mean, that's 60 bucks each. And yeah, I mean, it's 20 bucks. Taxes, theater. He's got his taxes. Theater is better because you have a chef there who will make food. But yeah. And for those of you asking about the all in summit sacks and I are leading the charge for a February or April, we got a couple of locations. Thank you to everybody who sent us. Vacation ideas two days 250 people 200 paid tickets 50. By scholarship and you can go to the all in website. When we have information, we will post it there. But we're just in the planning phase right now. But we're thinking 2 days, right, boys? Yeah. Two days for all summit and then five hours of content, something like that. A day we each interview people. Yeah. And then we're done. OK. And Miami is the host city and we'll draw high card for who picks the next city. Chamath, you said you're picking something in Italy. I'm going to probably pick my over Venice, Rome or Venice. I'm going to probably pick New York for mine or Austin and then Freeburg, where would you pick? Napa or something? Marin County. Oh wow. Where everybody wants to go. Great. And go to anti Vaxxer town. **** you. Freeberg. Marin County. Wow. What a destination, free broker. Would you pick? Would you pick? So we're doing Miami first, is that right? Miami's first and we draw high card for the next city. Who gets to pick next city? Each bestie picks for four years. Each party picks when. If we go twice a year, even better. I mean, I'd probably split it between London and Woo woo London and somewhere in Hawaii. Why choice? Why? Hawaii inspired choice. Can you imagine? 250 degenerate? London's great. Iconoclastic, but London would be. We would take over, take over. Miami is freaking out. Run over Annabelle's, boys. I bring you all to Annabelle. It's incredible that that members club is, I think, the most over the top thing I've ever seen. You're you're referencing something that no one knows what you're talking about and nobody knows what you're talking about. Is that a nightclub? Yeah, it's a night. Well, no, it's a private. It's a, it's a, it's a members club. She's down on the in the West End. Yeah. No, you have to have members clubs in London because you can't drink alcohol after like 9:00 PM unless it's a private club. Yeah. Alright, we'll see you all next time on the all in podcast. Here's to another 50, everybody. 1st, 50, done. Love you guys. Let's get another 50 in the books. Let your winners ride Rain Man. David said that. We open sources to the fans and they've just gone crazy with it. Besties? My dog's driveway. Ohh man. Should all just get a room and just have one big huge **** because they're all so useless. It's like this, like sexual tension that they just need to release them out now. Beat, beat. Where did you get mercies on?