Crypto Pump & Dumps Have Become the Ugly Norm. Can They Be Stopped? - Ep. 834
The Movement Labs scandal exposed more than just one bad deal – it pulled back the curtain on a widespread problem in crypto: how some market makers, founders, and VCs play games to make money — whether the project succeeds or not.
In this episode, Laura speaks with José Macedo of Delphi Labs, Omar Shakeeb of SecondLane, and Taran Sabharwal of STIX to explain:
How market makers are supposed to work, and how they operate in crypto
Why insider selling is more common than you think
How projects like Movement, Mantra, and others exploit launch day hype
Whether VCs often enable this behavior with side deals that retail never hears about
And what the industry needs to do to fix this broken system
Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com
Bitwise
José Macedo, founder at Delphi Labs
Omar Shakeeb, cofounder of SecondLane
Taran Sabharwal, founder and CEO of STIX.
Movement Labs:
Unchained: How MOVE’s Contracts Put a Pump and Dump Into a Legal Agreement
CoinDesk: Inside Movement’s Token-Dump Scandal: Secret Contracts, Shadow Advisers and Hidden Middlemen
Market making:
The Chopping Block: Can Crypto Clean Itself Up? Market Structure, Trust, and Regulation
Mantra Founder Is Burning 150 Million Tokens. Would He Try to Get Them Returned?
ZachXBT Ties REEF Founders to OM Token Crash
Timestamps:
👋 0:00 Intro
🤝 1:51 What Omar’s and Taran’s companies do
🎭 3:40 How market making works and how crypto twists the model
⚠️ 9:35 Why crypto’s market maker incentives are broken by design
🛠️ 16:25 What it would take to fix shady market maker behavior
🚩 26:20 How some founders exploit launch day hype to dump on retail
🧠 38:11 Did Mantra’s JP pull off a “genius” move or manipulate the market?
🔍 42:22 Whether crypto traders do any research before apeing in
💸 52:48 How founders are incentivized to dump their own tokens
🏦 59:09 Why VCs may be fueling this problem with insider deals
📉 1:02:37 What crypto needs to learn from traditional finance
✅ 1:06:13 The biggest fixes the industry must prioritize to stop these scams
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RERUN: How to Figure Out Whether a Crypto Token Is Worth Its Trading Price - Ep. 756
Low float and high fully diluted valuation (FDV) coins have been a hot topic in crypto this year. Yet, understanding these coins' unrealized gains is critical for truly grasping their pricing.
In this episode, Jose Macedo of Delphi Digital and Ari Paul of BlockTower Capital dive deep into metrics that help assess a coin’s true value. They discuss why upcoming token unlocks may put downward pressure on the market, how token unlocks could be better structured for long-term success, and whether VCs are extracting more value than they contribute.
Show highlights:
Why upcoming token unlock events are creating anxiety in the crypto market
The role unrealized gains play in token price volatility
How certain projects manipulate circulating supply metrics to influence perceptions
Tips for everyday investors to uncover accurate token information
The impact of secondary market trading on anticipated token unlock events
Why short-term token strategies often prevail over those focused on sustained success
Jose’s insights into why simple, time-based unlock models may outperform complex systems
Ari’s thoughts on the SEC’s investigations into VCs and their parallels to pump-and-dump schemes
Why many crypto projects face a bearish outlook due to pending token unlocks
How the intersection of memecoins and VC involvement could shape the next market cycle
Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com
Thank you to our sponsors!
Polkadot
Guests:
Jose Macedo, founder at Delphi Labs
Ari Paul, CIO of BlockTower Capital
Previous appearances on Unchained:
Ari Paul on Why Bitcoin Is a Good Value Buy
Ari Paul of BlockTower Capital on the Crypto Downturn and Why It Could Change Direction
Links
High FDV and unlocks:
Unchained:
How ‘Fully Diluted Valuation’ Can Be a Very Dangerous Metric for Crypto Markets to Rely On
Who’s to Blame for the Underperformance of Low Float, High FDV Tokens?
80% of Tokens on Binance Are Down Since Listing Date: SwissBorg Researcher
Cobie newsletter: New launches (part 1) - private capture, phantom pricing
Rocknblock: Token vesting explainer
CoinDesk: 'Liquid Vesting' Is Oxymoronic Blockchain Feature That Lets Early Investors Sell Without Waiting
Jose’s thread that inspired the episode
Ari’s post responding to Jose’s thread
Token.unlocks.app: Token vesting tracker
Solutions:
Hack VC: Potential Solutions to Crypto's Unlock Problem
Colony Lab: Early-Stage Program & Liquid Vesting
Imran Khan’s tweet on Blast https://x.com/lmrankhan/status/1806040646433522149
Timestamps:
00:00 Intro
02:46 Token unlocks creating market concerns
11:06 Unrealized gains to market cap ratio impact
13:06 Token supply manipulation tactics
21:11 How investors can verify token projects
24:21 Secondary market trading and unlock impacts
35:36 Current token launch strategy persistence
41:46 Short-term vs long-term project decisions
47:21 Time-based vs metric-based token unlocks
53:51 SEC investigations into VC practices
59:56 Bearish outlook for upcoming token unlocks
1:06:36 Investor risks in current cycle
1:13:11 Future of VCs in crypto and memecoins
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How to Figure Out Whether a Crypto Token Is Worth Its Trading Price - Ep. 667
The problem of low float, high fully diluted valuation (FDV) coins is one that is frequently discussed in crypto. But there’s another wrinkle: investors need to understand the unrealized gains of these coins to really understand the price.
In this episode, Jose Macedo of Delphi Digital and Ari Paul of Blocktower Capital explain the various metrics that reveal what a coin is really worth, why a wave of token unlocks that will be hitting the crypto markets in the next few years are not bullish, and whether there is a better way to design token unlocks for teams and insiders.
Plus, they cover whether venture capitalists are extractive to crypto, whether these games with circulating supply and FDV have caused investors to turn to memecoins, and why they believe the ICO era was better for retail investors.
Show highlights:
00:00 Intro
01:58 Why upcoming token unlocks are creating market jitters
10:22 How the ratio of unrealized gains to market cap influences token price movements
12:22 How some token projects manipulate their reported circulating supply
20:24 Whether and how everyday investors can uncover the truth about token projects
23:37 What secondary market trading says about the potential impact of upcoming token unlocks
34:50 Why Jose believes that the current token launch strategy, despite its flaws, is still favored by insiders and unlikely to change soon
41:02 Why some projects favor decisions that are more likely to result in short-term gains over long-term success
46:36 Why Jose believes that simple time-based token unlocks often work better than complex metrics, and how projects can balance funding with realistic success metrics
53:04 Why Ari believes the SEC's investigations into VCs for acting as securities dealers might be justified, and how these practices resemble pump-and-dump schemes
59:11 With numerous token unlocks looming, why the outlook is bearish for many projects, and what challenges they face in mitigating potential sell-offs
1:05:52 Why many crypto investors might end up holding the bag in the current cycle, despite plans to sell early and avoid losses
1:12:27 What the future role of VCs is in crypto, and how the influx of token unlocks and the rise of memecoins could shape the bull cycle
Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com
Thank you to our sponsors!
Polkadot
Guests:
Jose Macedo, founder at Delphi Labs
Ari Paul, CIO of Blocktower Capital
Previous appearances on Unchained:
Ari Paul on Why Bitcoin Is a Good Value Buy
Ari Paul of BlockTower Capital on the Crypto Downturn and Why It Could Change Direction
Links
High FDV and unlocks:
Unchained:
How ‘Fully Diluted Valuation’ Can Be a Very Dangerous Metric for Crypto Markets to Rely On
Who’s to Blame for the Underperformance of Low Float, High FDV Tokens?
80% of Tokens on Binance Are Down Since Listing Date: SwissBorg Researcher
Cobie newsletter: New launches (part 1) - private capture, phantom pricing
Rocknblock: Token vesting explainer
CoinDesk: 'Liquid Vesting' Is Oxymoronic Blockchain Feature That Lets Early Investors Sell Without Waiting
Jose’s thread that inspired the episode
Ari’s post responding to Jose’s thread
Token.unlocks.app: Token vesting tracker
Solutions:
Hack VC: Potential Solutions to Crypto's Unlock Problem
Colony Lab: Early-Stage Program & Liquid Vesting
Imran Khan’s tweet on Blast https://x.com/lmrankhan/status/1806040646433522149
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The Chopping Block: Gabriel Shapiro on Why Sam Bankman-Fried May Be a ‘Sociopath’ - Ep. 555
Welcome to The Chopping Block – where crypto insiders Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and chop it up about the latest news. This week, the crew is joined by Gabriel Shapiro, general counsel at Delphi Labs, to talk about the key points in the criminal trial of Sam Bankman-Fried and his lackluster defense strategy so far. They also delve into Michael Lewis’ book and his depictions of SBF’s “lore and backstory,” and discuss how SBF’s “quirks of character” may have actually enticed investors.
Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform.
Show highlights:
How Haseeb's previous comments on Sam Bankman-Fried’s intentions "didn't age well" after developments in the trial
Why Gabriel believes that SBF is a "sociopath" and should have taken a plea deal if offered
Shortcomings in the defense’s strategy and why Gabriel believes they’re “grasping at straws”
How the fake numbers of FTX insurance fund highlight the weaknesses of a centralized exchange
Why Matt Huang, cofounder of VC firm Paradigm, agreed to testify in such a high-profile trial, and why Haseeb as a VC himself wouldn't have done it
Whether SBF understood the technical components of crypto and why he sounded like ChatGPT in his responses, according to Tarun
Whether VCs are to blame for investing in FTX or what lessons VCs need to take away from the SBF debacle.
The differences and similarities between SBF and Binance CEO Changpeng Zhao
Hosts
Haseeb Qureshi, managing partner at Dragonfly
Tom Schmidt, general partner at Dragonfly
Tarun Chitra, managing partner at Robot Ventures
Guest:
Gabriel Shapiro, General counsel of Delphi Labs
Previous appearances on Unchained:
Are DAOs Strong Enough to Survive the Regulators?
What Does Mango Markets Exploiter Avi Eisenberg’s Arrest in Puerto Rico Mean for DeFi?
Disclosures
Links
Previous coverage of Unchained on the trial of Sam Bankman-Fried:
Sam Bankman-Fried Trial: Here's Everything That Happened So Far
SBF Trial, Day 1: Possible Witnesses Include FTX Insiders, Big Names in Crypto, and SBF’s Family
SBF Trial, Day 2: DOJ Says Sam Bankman-Fried ‘Lied’ While Defense Claims His Actions Were ‘Reasonable’
SBF Trial, Day 3: Why a True Believer in FTX Flipped Once He Learned One Fact
SBF Trial, Day 4: SBF’s Lawyers Annoy Judge Kaplan, While Wang Reveals Alameda’s Special Privileges
SBF Trial, Day 5: SBF’s Defense Finally Found Its Legs, But Can It Counter Caroline Ellison?
SBF’s Lawyers Could Be Annoying the Judge. How Might That Impact the Trial?
Did Sam Bankman-Fried Have Intent to Defraud FTX Investors?
Here’s How Sam Bankman-Fried’s High-Stakes Trial Could Play Out
SBF Trial: How Sam Bankman-Fried’s Lawyers Might Try and Win His Case
The High-Stakes Trial of Sam Bankman-Fried Begins: What to Expect
FTX Used a Fake Number to Beef Up Its Insurance Fund: Gary Wang
Previous coverage of the trial elsewhere:
NYT: What FTX’s Sam Bankman-Fried and J.P. Morgan Have in Common
Forbes: Sam Bankman-Fried Knew Plenty About His Alameda Research Hedge Fund–And Sent Details To Forbes Just Months Ago
Tarun's tweet on insurance funds being onchain
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Are DAOs Strong Enough to Survive the Regulators? - Ep. 479
How can decentralized autonomous organizations (DAOs) be more resilient? Gabriel Shapiro, general counsel at Delphi Labs, and Fatemeh Fannizadeh, lawyer and researcher at Geneva-legal.ch, survey the landscape and offer their insights on what will fuel the next wave of DAO innovation. Are new rules from U.S. states like Wyoming and Utah a boon for DAO creation? Or will the proceedings against Ooki DAO by U.S. regulators cast a pall on this emerging segment of the Web3 world?
Show highlights:
how Gabriel and Fatemeh determine whether something is actually a DAO
the pressing legal issues around DAO formation
where the liabilities lie in these types of organizations
Delphi Labs’ new “borg” concept and the problems it aims to solve
what jurisdictions are more appropriate for different DAOs
the nuances of Wyoming’s DAO LLC law
Utah’s Introduction of LLDs – limited liability DAOs – and why it is innovative
why the CFTC filed a lawsuit against Ooki DAO
whether governance token holders are liable for the DAO’s actions
how the Ooki lawsuit will impact how DAOs structure their activities in the future
what happened in the MakerDAO case and its implications
why Fatemeh and Gabriel disagree on whether the Mango DAO’s agreement to not pursue actions against Avi Eisenberg was legally binding
Thank you to our sponsors!
Crypto.com
Halborn
Guests:
Gabriel Shapiro, general counsel at Delphi Labs
Previous appearances on Unchained:
What Does Mango Markets Exploiter Avi Eisenberg’s Arrest in Puerto Rico Mean for DeFi?
Fatemeh Fannizadeh, lawyer and researcher at Geneva-legal.ch
Lawmakers In New Hampshire And Utah Recognize DAOs As Legal Persons
Links
MakerDAO:
CoinDesk: Crypto Investors' $28M ‘Black Thursday’ Lawsuit Against DeFi Giant Maker Dismissed by US Judge
Mango Markets:
CoinDesk: Legal Expert Says Mango Markets Exploit Case Is Wake-Up Call for DAOs
Avi Eisenberg Detained Unlike SBF As Mango Labs Is Denied Injunction But TRO to March 15
Unchained:
The Mango Markets Attacker on Whether His 'Trade' Was Ethical or Not
CFTC Charges Mango Markets Exploiter With Market Manipulation
Mango Markets Exploiter Arrested on Market Manipulation Charges
Tornado Cash
Unchained:
The Chopping Block: Did OFAC Overstep by Sanctioning Tornado Cash?
Given the Sanctions on Tornado Cash, Is Ethereum Censorship Resistant?
Tornado Cash Sanctioned. Did the Government Overstep Its Bounds?
Ooki DAO:
Unchained: Why the Ooki DAO Case Could Hurt Participation in DAOs
CoinDesk: Interpreting the CFTC’s Lawsuit Against Ooki DAO
Wyoming law
Legal Nodes: Wyoming LLC as a DAO Legal Wrapper: What You Need to Know
Utah
The National Law Review: Utah Passes Innovative DAO Legislation
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What Does Mango Markets Exploiter Avi Eisenberg's Arrest in Puerto Rico Mean for DeFi? - Ep. 441
Gabriel Shapiro, general counsel at Delphi Labs, and Collins Belton, managing partner at Brookwood P.C., dive into the controversial case of Avi Eisenberg, the self-described “applied game theorist” who was arrested in Puerto Rico on Dec. 26 on market manipulation and fraud charges. The two crypto lawyers discuss the case’s potential impact on DeFi and DAO governance — and whether “code is law” stands a chance in the courtroom.
Show highlights:
whether Avi’s manipulation of the markets constitutes fraud
debating the crypto maxim “code is law”
whether it’s wrong to use DeFi code in a “smarter way”
how the Mango Markets exploit happened due to poor governance management
whether crypto should be regulated from the securities angle or the commodities angle
the consequences of Avi’s arrest for the DeFi space
whether MEV could constitute market manipulation, even if it’s democratized for everybody
the role of DAOs and whether early-stage projects should maintain some level of centralization
how DAOs could be designed to have better mechanisms in order to deal with potential issues
whether members of the Mango Markets DAO are liable because of their role in designing the system
how Avi was “naive” to think he could avoid legal liability by returning the funds
why Gabe thinks credit protocols are socially positive and why he hopes that prosecutors won’t “throw everyone in jail”
Thank you to our sponsors!
Crypto.com
DeFi Saver
Links
Guests:
Gabriel:
Twitter
Delphi Labs
Gabriel’s Twitter thread on the case
Previous appearances on Unchained:
The SEC's Lawsuit Against Ripple and 2 Execs: What You Need to Know
Collins:
Twitter
LinkedIn
Previous appearances on Unchained:
How the Greatest Decentralizing Force for Crypto Projects Is the SEC
Episode Links:
Previous coverage of Unchained on Avi Eisenberg and the Mango Markets exploit:
The Mango Markets Attacker on Whether His 'Trade' Was Ethical or Not - Ep. 413
The Chopping Block: 'Code Is Law' Is 'Obviously Not How Anything Works Ever'
The Chopping Block: SBF Wants to Win in the Court of Public Opinion. Will He? - Ep. 428
Mango Markets exploit
Explanation
Avi’s “Highly profitable trading strategy” Twitter thread
Unchained:
Mango Markets Exploiter Arrested on Market Manipulation Charges
Mango Markets Exploiter Gets Liquidated But Leaves Aave With ‘Excess Debt’
Mango Markets $42M Reimbursement Proposal Passes
Mango Markets Exploiter Returns $67M After Revealing His Identity
Mango Markets Hacker Proposes Keeping $70M ‘Bad Debt’ As Bounty
Solana’s Mango Markets Sees $100M Drained in DeFi Exploit
Chaindebrief: How Manipulation On AAVE And CURVE Went Wrong, Attacker Got Rekted Instead
The Defiant: Another Fork Bites the Dust: The Looming Fall of Fortress DAO and the Perils of Off-Chain Governance
Karlstack: EXCLUSIVE: The Man Who May Have Milked $100+ Million from Mango Markets
CoinDesk:
The Impact of Avraham Eisenberg’s Case on the Future of Crypto
Mango Markets Exploiter Eisenberg Arrested in Puerto Rico
Mango Exploiter's Funds Get Liquidated After Roiling Aave Using $20M of Borrowed Curve Tokens
Complaint
CNBC: Decoding The Avraham Eisenberg Arrest And Its Impact On Crypto Bug Bounties, White Hat Hackers
Decrypt: Mango Markets Attacker Avraham Eisenberg Arrested, Charged With 'Market-Manipulation Offenses'
Protos: Who is Avraham Eisenberg and why is he all over Crypto Twitter?
Crypto Briefing: Curve Whipsaws 75% as DeFi Degens Squeeze Avraham Eisenberg
New Filing: CFTC charges Avi Eisenberg
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Delphi Labs' Gabriel Shapiro on How 100% of DeFi Could Become Illegal
This week on The Defiant Podcast we speak with Gabriel Shapiro, general counsel at Delphi Labs and a member of the LeXpunK group of crypto lawyers. He’s regarded as one of the most prominent voices on regulation in the crypto space, which has lately been a major point of discussion.
Recent developments include the latest draft of the DCCPA bill, Sam Bankman Fried’s industry standards proposal, the CFTC charging Ooki DAO, and the Tornado Cash sanctions. We begin our conversation with Gabriel sharing his thoughts on the current state of the crypto regulatory landscape in the U.S.
There are currently seven government bodies that govern crypto in the US. These are the SEC, CFTC, CFPB, IRS, FinCEN, OFAC, and Congress. We discuss how setting an overarching framework within which these bodies can operate could prevent them from regulating their own corners of the market.
In comparison to other DeFi projects that offer similar services, Ooki DAO is a relatively small player. With the CFTC coming after Ooki DAO, we explore the potential implications for the biggest players in the space like Aave and Compound.
🙏 Thanking our podcast sponsors:
This episode is brought to you by Circle, the sole issuer of USDC, and a leader in crypto that’s held to a higher standard. Learn more at https://www.circle.com/en/usdc
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The SEC's Lawsuit Against Ripple and 2 Execs: What You Need to Know - Ep.208
Stephen Palley, partner at Anderson Kill. and Gabriel Shapiro, partner at BSV Law, discuss the SEC's lawsuit against Ripple and two executives, Chris Larsen and Bard Garlinghouse. In this episode, they explain:
what was so "egregious" that the SEC went after two executives, Chris Larsen and Brad Garlinghouse, were charged
why their sales showed an information asymmetry, and why that matters
why the complaint comes close to being a fraud case, but why the SEC didn't charge them with fraud
why the idea that XRP is a currency and therefore cannot be a security will likely not fly
why it's unlikely the case will go to the Supreme Court
the SEC's case for why XRP is a security, and Ripple's role in it
how even on a technical level, the XRP network is centralized
how strong the SEC's case is against Larsen and Garlinghouse
Stephen's and Gabriel's predictions on how the lawsuit will play out
how this will likely impact XRP investors
whether or not Ripple could become an SEC-reporting company and XRP a security
what happened with Ripple's lead investor in its most recent fundraising round
whether or not the SEC might go after exchanges or other players who made money off XRP or collaborated with Ripple around XRP trading
what this means for Coinbase, in particular, because it's going public later this year
what Ripple's defense, in its summarized Wells submission, was
how this case compares to some of the other big SEC/crypto securities cases, Kik/Kin and Telegram
whether there might ever be a digital token that is determined to be a security for specific transactions but not others
what the wider implications of the case are for the rest of the crypto industry
Thank you to our sponsors!
Crypto.com: http://crypto.com
1inch: https://1inch.exchange
Episode links:
Stephen Palley: https://twitter.com/stephendpalley
Gabriel Shapiro: https://twitter.com/lex_node
SEC lawsuit against Ripple: https://www.sec.gov/litigation/complaints/2020/comp-pr2020-338.pdf
SEC lawsuit against Ripple being close to a fraud case: https://twitter.com/stephendpalley/status/1341523294344896515?s=20
Former SEC commissioner Joe Grundefest on the case: https://www.theblockcrypto.com/linked/89164/former-sec-commissioner-says-ripple-lawsuit-will-cause-multi-billion-dollar-losses-to-innocent-third-parties
Other lawsuit against Ripple: https://www.courtlistener.com/recap/gov.uscourts.cand.334410/gov.uscourts.cand.334410.115.0.pdf
Technical assessment of Ripple network: https://cryptobern.github.io/noconsensusripple/
Tetragon’s case against Ripple: https://twitter.com/stephendpalley/status/1346531087971999749?s=20
What the case means for exchanges: https://www.coindesk.com/coinbase-delist-xrp-exchanges-dilemma
Coinbase suspends trading in XRP: https://blog.coinbase.com/coinbase-will-suspend-trading-in-xrp-on-january-19-2e09652dbf57
https://www.coindesk.com/coinbase-suspends-xrp-trading
Lawsuit against Coinbase: https://www.bloomberg.com/news/articles/2020-12-30/coinbase-sued-over-xrp-commissions-after-sec-pursues-ripple?sref=m9L277rN
https://twitter.com/stephendpalley/status/1344352455895691269?s=20
People in the industry thinking for a while that XRP is a security: https://www.theblockcrypto.com/genesis/57366/xrp-is-probably-a-security-dont-at-me
Mary Jo White: https://www.coindesk.com/former-sec-chair-represents-ripple-xrp-lawsuit
Ripple’s Wells submission: https://ripple.com/wp-content/uploads/2020/12/Ripple-Wells-Submission-Summary.pdf
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