Crypto should be one of the biggest stories out of the Trump administration, but the crypto guys are really good at making it seem more complicated than it is. Bloomberg's Zeke Faux joins Tim to run down the ins-and-outs, and the players—including the Chinese businessman facing SEC charges who swears the $56 million he gave Trump has absolutely nothing, zero, zilch to do with his case. Meanwhile, we're about to find out how much Republicans really care about the deficit with the coming budget, and the Democrats must not cave. Plus, Elon's crappy math, America would not get anything out of Trump's deal with Russia, and Tuesday's violence in an Orthodox Jewish neighborhood in Brooklyn. Rep. Jared Moskowitz and Zeke Faux join Tim Miller. show notes Zeke's book, "Number Go Up: Inside Crypto's Wild Rise and Staggering Fall" Zeke on Chris Hayes's podcast
Chapter 1: What are the biggest crypto scams of the Trump era?
Great. Thanks for having me on, Tim. Dude, thanks for doing this. I'm obsessed with this. I'm of the view that the crypto scams will probably be a top three to five story of the Trump years when all is said and done. And I think that a lot of the media outlets don't give this quite as much attention because the demographics of the news consumers don't overlap with the crypto world much.
A lot of them don't really even understand it. And then a lot of the people in the journalist world... have such contempt or just like culturally or separate from the types of folks that are really into crypto. And so it leads to like not getting ignored.
And obviously you're not ignoring it, but I'm wondering if you kind of agree with my assessment of, obviously I would assume you agree that this is undercover. It's your beat. I'm wondering what you think about that, about my assessment for why. Yeah.
Definitely. I mean, the crypto guys are very good at making it seem like they have a lot of jargon. They make it seem like there's some sort of really complicated and important technology that we're talking about. And it makes you think in the back of your mind, if you don't know that much about this, or even if you do, you're like, it can't possibly be as dumb as it sounds, could it?
And the answer is yes.
And in fact, it's even dumber. Yeah. Okay, so I want to do just a little bit of Crypto 101 for our listeners that don't follow this stuff. But if this brief Crypto 101 lesson isn't enough, you did Chris Hayes' Why Is This Happening pod a couple weeks ago, and it was like 45 minutes of Crypto 101. It was really good. So I direct people to that.
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Chapter 2: How does cryptocurrency work and what are meme coins?
if they don't get enough but um at its basic level right like there's cryptocurrency then there's bitcoin which is you know the most famous or whatever the most renowned but then there are all these other coins so you just kind of explain to people how all these kind of terms interact with each other
So the original idea for Bitcoin, the first cryptocurrency, was that this would be a alternative to regular currencies like the dollar or the yen. And the big innovation was that instead of being tracked by a central counterparty like a bank, there would be this decentralized network of computers that would keep track of this new currency. Now, that was 15 years ago.
Bitcoin is as old as WhatsApp or Uber. And this idea of it becoming an alternative currency is largely dead. No one's really using it for that. But instead, there's been this proliferation of other cryptocurrencies. And at this point... Most of them are not meant to be like dollars. They represent all sorts of different things.
So some of them are kind of like stocks where if you buy a share of this, you buy a coin, you're almost like buying a share of some sort of company. Other times, it's like a new...
network like ethereum or solana where it's like a place where people are creating other crypto things and when you buy one of those coins you're kind of buying into the network and you get a share of its profits so that's almost like buying into like a crypto bank kind of right like it's like it's like investing in a stock for a bit or an exchange or a bank essentially
Yeah, some of them are a lot like that. Like Sam Bankman Freed had one that was called FTT. That was basically just stock in his crooked exchange FTX. But at the silliest end, we have, and which is one of the most popular things in crypto right now, are meme coins. And the first one of these was called Dogecoin. And it's also like...
more than 10 years old, it was created as kind of a parody of Bitcoin. And it was saying, we're going to copy Bitcoin, we're going to change the name, we're going to put a picture of a dog on it. And It turned out that, I don't know if you think this is a funny joke, but it turned out enough people did think this was kind of interesting that they started to buy it.
Unlike a stock or unlike one of these ones where you're buying into a network that generates fees with Dogecoin or other meme coins, there's no way for it to ever generate any money. You're purely buying it on the idea that somebody else might buy it. also for no reason, driving the price up higher. It's kind of like a new form of gambling game. And in the last couple of years,
Thousands of these meme coins, maybe even hundreds of thousands of these meme coins have been created. People are just pumping them out. And there are all these traders that are kind of have they've made it a game to chase like the new meme coin. And if you get in early, the goal is to get in before the masses and then profit when the price spikes and sell it before it inevitably collapses.
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Chapter 3: What is Trump's involvement with meme coins?
Yeah, okay. So I want to go through the people involved in this Trump coin because here's where we get to the yarn. So you've got Steve Witkoff, who is his envoy, I guess, to negotiations now around the world, this business guy. He was the lead in the hostage trade with Russia recently. Witkoff's kids, his kid rather, is a business partner with Trump's kids on this Trump coin.
So he also made some cash out of the coin. Is that right?
I believe that actually Witkoff was the business partner on Trump's first cryptocurrency, not the Trump coin.
Thank you for clearing that up.
Now, I mean, if he didn't get in on Trump coin too, I'm sure he would be mad because that was like a great money making opportunity right there. But Trump had an earlier cryptocurrency deal. called World Liberty, where Witkoff and his son had a big role.
Okay. So his crypto business partner is the lead on this negotiation. Maybe just a coincidence, but in the hostage trade, we get Mark Fogel, an American teacher. We're glad that he's home. The Russians get Alexander Vinik. He was arrested in 2017 on charges related to the laundering of billions of dollars using virtual currency Bitcoin.
So we have a Russian Bitcoin money launderer that is the first person out on their side. Maybe a coincidence, but pretty noteworthy that that was the person that was there on the trade with Witkoff, the crypto business partner.
One interesting part of that was this guy, Alexander Vinik, appeared to be just like a crypto criminal who ran an exchange that some people say was even set up to launder the proceeds of hacks. It's not immediately obvious to me why Russia would want him back or what he had done for Russia. So I was intrigued that he was their side of that trade.
In addition, this also ties to kind of our previous conversations about how the U.S. is now on the side of the baddies in these world events. Justin Sun, who is the subject of an SEC enforcement action, big investor in the first Trump crypto gambit before the more recent coin. Talk to us about Justin Sun.
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Chapter 4: Who are the key figures in Trump's crypto circle?
And he kind of repeated his defense of the company and said, hey, Tether works with law enforcement. They're against crime. They want to stop it. You know, I've helped them improve their compliance. He just got confirmed. So he'll be the Commerce Secretary.
That's our commerce secretary. Okay. Elon is also deeply invested in this stuff, was a big pusher of Dogecoin. Eric Adams, who just got pardoned, is mobbed up in crypto world. And so I want to talk about the policy side of this, but is there any other Trump 2.0 connections worth mentioning? Andreessen, big advisors, big pusher of this.
His crypto czar, David Sachs, is an investor in Solana, which is like the network that the meme coins run on. So with these meme coins, right, it seems pretty weird. Like, is the government going to do anything about this? It's like a question you might ask.
You think it would be regulated. Like, I'm for gambling, for example. I'm pro gambling. Vegas is a very highly regulated industry. Gambling is a very highly regulated industry. It's like, you want to gamble on meme coins? Okay. But like, shouldn't there be regulation?
But like the guy who is ostensibly would be in charge of that is now the crypto czar is an investor in the exchange where they trade the meme coins. So probably not a lot of incentive.
More or less. And he's come out and said, these are collectibles. These are digital collectibles, which is code for they should be unregulated.
Yeah, like baseball cards instead. So the other things is we have named to the oversight of this is this Brian Quintens, who worked for Marc Andreessen's VC firm. The firm was the leading backer, one of the leading backers of a crypto, pro-crypto political action committee. So this guy is going to be now at the CFTC. We got, you know, Fox Henhouse situation.
They've also been pushing for this Bitcoin Reserve, where I guess they would put... the government, our government would start investing into this. So, you know, talk about any of the policy implications there.
Yeah, the Bitcoin Reserve is one of the craziest policies that has been put on the table here. And I saw Trump propose this at the Bitcoin conference in Nashville last year. And I was just shocked that he was repeating so many of the industry's talking points. And yeah, one Republican senator has sort of spelled out some details for this.
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Chapter 5: How does the US government relate to cryptocurrency regulation?
Yeah, I mean, look, I like Marco a lot. I'm happy Marco's the Secretary of State, especially in comparison to some of the other picks. Yes. Remember, everything's relative.
What did he say yesterday that would have been different from what, I don't know, Corey Lewandowski would have said as Secretary of State? What did he say different?
Let's not ever get to the point that we test that difference, Tim. I'm just wondering. I would like to have heard what he said different. That's all. Just when you think the line can't go any further, we continue to move it. So let's not tempt them, please.
Your man, Jesse Waters.
Marco didn't blink during that statement, right? And so at the end of the day, there were no specifics there, right? But I do think there is something happening with this Gaza stuff and this Ukraine stuff, which is Trump wants to prove to the world that he can solve... the most difficult foreign policy things. Biden couldn't solve it. No one could solve it. Only he can solve it.
He wants the Ukrainians to give up a lot of these, as he says, raw earth materials, right? And apparently he's asked for so much and the Ukrainians have said no, or they've said no to how much he wants. Well, by the way, as soon as they said no to how much he wants, notice the pivot of Trump.
Oh, OK, you won't give me what I want, which is these raw earth materials in exchange for our continued investment. No problem. I'll pivot and I'll go full direction of Putin won't even invite you to the meeting. I'll get my secretary.
I thought America first was about getting us stuff. We're not getting shit out of this deal. Like Ukraine is giving up everything. We're creating conflict with our allies. We're adding tariffs to our allies. That's going to cost us more money. What do these deals get for us? I haven't seen anything that is an America first deal yet to me.
Oh, the slogans. You're throwing out the slogans.
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Chapter 6: What are the implications of a Bitcoin Reserve policy?
Well, by the way, the Trump administration has even stopped posting the metrics of the deportation data because the data is actually below the deportations of Joe Biden at this moment in time. I saw that. Look, this is no different than we're going to fix egg prices on day one. Egg prices are now the highest they've ever been. This is no different than 24 hours.
I can solve the Ukraine war in 24 hours, right? Well... We're a little beyond that. Inflation. I'll solve inflation. I'll get interest rates down. Inflation's bumping. Interest rates are stagnant. And look, you know, this is the hyperbole of the campaign that we saw the first time around. And, you know, it works, which is why he does it. You know, people buy it.
And then we can distract people with, we're buying Greenland, we're buying Gaza, Canada, Panama, right? And, you know, it's like everybody who watches a car accident, you know, and slows traffic down. Everyone's jumping at these distractions or, you know, when all this other stuff's going on. So look, we have to watch the Ukraine thing.
It's obviously very concerning, the current trajectory coming out of the United States. Ukraine is going to have to give up something, right? This idea that they're not going to give up.
Russia should probably give up something too. Russia shouldn't just get stuff. That's, I guess, my main problem.
Russia's going to have to retract from some of their positions. There's no question. No question about that. And it's also the future. What's the future look like? for this region. But obviously, we will have major problems with China, and we'll have major problems with our European allies, major problems with our European allies, if we just look like we're kowtowing to Putin.
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Chapter 7: How do international events intertwine with crypto and politics?
In fact, let me give you a real scenario. Trump proposes a deal, and they say no. What's his repercussion? We're going to not supply the weapons anymore? Okay, fine. He says, I'm not going to supply the weapons anymore. And Europe says, we'll step up.
OK, so now not only did Trump not solve the problem, now he's been cut out from the table because Europe decides to move forward anyway and there's no deal. And now we have a real Europe-Russia war, which can affect the U.S. economy in dramatic ways. So he's got to be very, in my opinion, careful on how far he goes to where he pushes Europe into having no choice but to continue the war without us.
Let's move on to what I really want to talk to you about, which is the budget stuff, because they're in a real pickle on this. And I liked what you tweeted, I forget, or said on an interview. They're like, basically, I'm for a balanced budget amendment. Let's do it. Let's balance the budget this year. Yeah.
And call them on their BS, because getting to a budget is very challenging, just as one microcosm. Last night, Trump said on Sean Hannity that he doesn't want to touch Medicaid. Today, he said, I support the House budget, which cuts Medicaid by like $800 billion or something.
So you've got Chip Roy, I got here, said every Republican needs to actually step up to honor what they've campaigned on when they say they want to balance the budget and reduce spending. So there's Chip Roy, your colleague. Meanwhile, Trump wants extension of the tax cuts, no tax on tips. Like the math just doesn't math for them. And so the question is, how do the Democrats deal with that?
And I'm curious your view.
Well, so there are lots of things going on with this whole situation. Right. First, let's just start with the math. Right. And people know this way. We've heard we've heard mandate. The American people voted for mandate. We have a mandate mandate. OK, we get it. Except in the House, they only have a three vote majority. Doesn't really sound like much of a mandate.
Very different from 2016 when I think Trump had like a 25 plus vote majority. Majority in the House.
2010, and you can just go back to any.
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Chapter 8: What is Jared Moskowitz's take on Trump and Ukraine?
We're going to find out if Thomas Massey and Chip Roy and 10 or 12 others, if they're willing to hold the line. on this. And we're going to find out really, if Doge is serious about going after the debt, if they're serious about going after the debt, which is what Elon always talked about. Elon talked about, we're going off the fiscal cliff, we got to cut our spending, right?
He's talked about that. Well, if that is serious, okay, and you're tweeting things like balanced budget, which he has tweeted, which is why I'm coming with that resolution. Then at the end of the day, they're either not going to be able to extend the tax cuts. Right. Or they're going to figure out how to either balance it with some cuts and raising some revenue. OK.
Or they're going to add to the debt. And then this whole conversation about the debt no longer has any merit whatsoever whatsoever. Ever, ever again. And yes, I know someone's probably thinking, well, Jared, Trump added, you know, he added more to the debt in his four years. And I would say yes, but this time around, they've made the debt the issue. They've made it the issue.
So since they've made it the issue, we got to hold them to it.
I agree. So do you have any Republicans yet co-signing with you on your resolution?
On the balanced budget? Yeah, I think I'll get some Freedom Caucus members.
You do?
Yeah, but Johnson's not going to pick it up. He's not going to hear it.
That's exciting. I think that it's important that they get on the record on this, though. And this is where we are completely aligned. And I think that... Maybe they are coming to realize how big of a pickle they're in. The only way out of this, frankly, for them at the end of the day is Trump bullying them all to push through something that is absolutely fiscally irresponsible in the extreme.
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