👁️ Trump's Strategic Sh*tcoin Reserve

Meanwhile, Artificial Intelligence is dying Faster than Memecoins.

Donald Trump is paying his cronies back with U.S. taxpayer dollars. Scroll down for details of the Strategic Crypto Reserve, and why ADA, XRP, and SOL are the perfect Trump Assets (you can guess the secret ingredient …).

But first, I’m excited to announce that I have completed the first draft of my forthcoming Repeater book “Stealing the Future: Sam Bankman-Fried, Elite Fraud, and the Cult of Techno-Utopia.” I was a bit worried the book would be coming out after its time, but it has turned out to be all-too relevant to the vein of bullshit that now has complete control of the U.S. government. So that’s nice!

All of the subscribers here have been *incredibly important* to supporting me while I get this done, as there was a very minimal advance. So if you’d like to subscribe now, it will still make a real difference.

Because the book isn’t even close to “done”: there are still months of edits ahead of me, and there will continue to be new chapters offered to subscribers. But this does mean there will be a wider diversity of premium posts for paid supporters. Here - without too much explanation to spoil the fun - are just a few of the topics that I’ve been longing to develop over the past few months while having to focus on the book.

• Towards a Horror of Economics

• How to Quit Everything

• “The Invisible Hand of the Market” Assumes Everyone Has the Same Wealth

• Towards a Resurrection of Focus Part 4: The Techne of Depth

So if nothing else, you’ll have that to look forward to.

David Sacks, cofounder of Craft Ventures and nakedly self-dealing Trump Crypto Czar.

OpenAI is Clearly Fucked

The reviews are in and the new GPT 4.5 could be fairly described as “beyond a disaster.” Gary Marcus has a roundup of reactions, but in short, it’s massively more expensive than 4.0 while in some ways seeming worse. This is the end of the road for the shockingly naive idea, promoted relentlessly by Sam Altman, that merely upscaling large language models will lead to God-like “Artificial General Intelligence.” As I’ve written, the massive waste of capital on the pursuit of sheer scale is deeply tied to the fundamentally racist concept of “IQ,” so there’s a satisfying comeuppance here.

Meanwhile, Microsoft is cancelling data center leases. Credit to Ed Zitron for really running with this ball for the past couple of years. The supposed next major step has been notionally tagged “GPT 5” for a while, but whatever that release actually winds up being, it won’t be intelligent, much less “conscious” - the claim made by grift-complicit researchers at Stanford nearly 2 years ago.

“I 愛 AI” by Aesthetic Calculations

Speaking of books and theory and AI failure, I was flattered to be invited to review a new work *very* close to my own interests. “I 愛 AI” by the collective Aesthetic Calculations asks the extremely important question - why was it so easy for Sam Altman to trick everyone into believing that LLMs could become intelligent? The answer has everything to do with emotions, not reason - and ultimately, our emotional relationship to ourselves.

“Why has AI been such an insistent figure in science and science fiction, to the extent that it appears to have brought itself about? Why does the human being love to love (or fear) the perfection of the artificial image so?” Strong recommend for this: available for order at the link above.

(The title, by the way, is an interlinguistic pun, one of my favorite things. The central kanji, in Japanese at least, means “love,” is Romanized as “ai,” and is pronounced like “I.” “Ai Ai Ai.” Perfection.)

All Quiet in the Memecoin Trenches

One of my theses about cryptocurrency has been that a total free market in speculative assets lets a lot of fraud happen - but also teaches lasting lessons. The idea that people can learn feels more and more challenging long-term, but it’s clearly working over a short horizon: after the Kelsier Ventures/$Libra fraud earlier this month, activity on the memecoin casino Pump.fun has fallen off a cliff. On February 26, the number of tokens that “graduated” by attracting enough bids to last more than a few minutes was near zero.

Here’s a Dune chart of activity over the past two weeks:

Does this mean crypto fraud is over? Good god, no. A slightly longer time-frame shows that Pump volumes aren’t even back down to Ocober 2024 levels. But more importantly, fraudsters will transform and move on faster than punters can figure out what the next con is. It won’t be memecoins, though.

Dems Finally Think Techno-Fascism Might Be Bad, Actually

Everything that’s in the process of going terribly wrong in America can be in large part attributed to mainsteream liberal Democrats and allied center-right outlets such as The Atlantic and The New York Times, who have spent much of the last decade doing credulous profiles of pseudointellectual chuds like Curtis Yarvin. So of course now, after the chuds have seized power, Dem operatives are circulating a document titled “The Imminent Neoreactionary Threat to the American Republic”.

Absolutely stellar performance, folks. This threat was imminent eight years ago.

My Best Friend’s Exit Liquidity: The U.S. Strategic Crypto Reserve

The underlying ethos of this newsletter is pretty unconventional and I rarely spell it out, so here’s a major pillar: I believe that cryptocurrency is both a genuinely revolutionary technology that upends national power, and also a hopeless tarpit of fraud and scammers. Bitcoin is and I truly hope will remain a border-eroding, trade-enabling, sanctions-circumventing technological step-change after which money simply cannot ever be the same - but it has also spawned an incredible ecosystem of cynical predators willing to lie for a buck.

This is relevant because I can at least superficially see some defensible reasons for some nations to hold a Bitcoin reserve, in the same sense they hold other currencies in reserve. Due to the nature of its technology and its launch in 2009, Bitcoin is by far the most “neutral” crypto, and it takes some serious sleuthing and conspiratorial argumentation to argue that it’s ‘controlled’ by anyone. It has the best chance of becoming a unified global financial networking layer, without the potential for weaponized censorship. As I argued in a TedX talk nearly a decade ago (holy shit), I believe that this has dramatic positive transformative potential for human society.

More to the point, it has utility for global trade. There is a serious case to be made that countries with weak currencies should hold some Bitcoin. I said as much in my qualified approval of the El Salvador Bitcoin experiment (followed by an appalled disavowal).

The case for America building a Bitcoin reserve is … well, there really isn’t a case, because we print the world’s payment rails: USD. That status will be threatened by any boost to Bitcoin - a boost which the endorsement of a reserve would provide. For America, it’s a self-defeating gesture, because Bitcoin is largely a hedge against the fall of the dollar, specifically. Meanwhile, the dollar has plenty of weight to throw around if Bitcoin does start to look like a real macro threat. My professional colleague Nic Carter - notably a pro-Trump guy - has a more detailed rundown of this anti-Bitcoin reserve point.

So I already thought the idea of a U.S. Bitcoin reserve was misguided. But Donald Trump’s newly-announced, multi-asset Strategic Crypto Reserve is not merely a bad idea, it is a profoundly corrupt fraud. And not just in some broad notional sense of “fraud”! The assets named in the reserve (which to be clear probably won’t happen) would directly benefit David Sacks, yet another South African immigrant ruining our country. Sacks is co-founder of Craft Ventures, whose index fund contains precisely the five assets Trump suggested would be in the reserve. Sacks also happens to be Trump’s “Crypto Czar.”

So yeah, we’re just doing corporate welfare for shitty venture capitalists now.

And let’s talk about those assets! The list of five starts with Bitcoin (BTC), launched in 2009, and Ethereum (ETH), launched in ~2016. I believe in Ethereum almost as much as I do Bitcoin - it’s sort of like Bitcoin with added features, and it’s a vibrant system with a lot of users (generating about $2m in fees per day) and a long history of stability. But even ETH isn’t suitable for any kind of government stake, because it has known founders with disproportionate holdings and a significant degree of influence, if not exactly control. Any U.S. ‘investment’ in ETH would be a clear case of picking winners and losers.

But then we get to the real dogs. Hilariously, Trump’s first Truth post made it sound like the Reserve would only consist of Cardano (ADA), Ripple (XRP) and Solana (SOL).

Only later did he sweatily circle back around to say yes, it will include Bitcoin and Ethereum, too. But an ADA/XRP/SOL reserve would have been all too fitting for the Trump administration. Because these three systems are, to varying degrees, all fraudulent.

The fact that XRP and ADA in particular are among the most valuable cryptoassets is the product of aggressive marketing and quite a bit of deception, including the dangerously viral falsehood that banks use XRP for transfers. It’s not true! It has never been true! This was Ripple’s pitch a decade ago and they never got any real adoption on the concept. In fact, Ripple’s main source of revenue for most of that time has been dumping the token directly to retail. They’re scumbags, frankly.

Cardano (ADA), meanwhile, sees about 1/5th the active use of Ethereum, and even that’s probably painted. There are zero credible stablecoins on the system, and the price has been supported by a lot of aggressive direct sales tactics, including being marketed very early on to Japanese nursing home patients. Founder Charles Hoskinson is also a turbo-creep, which is important because he still substantially controls the whole thing. On the other hand, he’s a big Trump fan, so who’s to say what’s right and wrong here.

Finally, there’s Solana (SOL), which has been trying for about five years to cement its credibility, but took a major hit with the $Libra scam last month. With memecoins dying, so is SOL, with the token price tanking about 25% in the past two weeks. It’s not a fraud per se - though its entanglements with FTX were extremely suspect - but it has definitely been a vehicle for major fraud.

Now, I’m not going to do the market sleuthing to run down cause and effect, but one of the funny things about the Strategic Reserve Assets is that when Trump Truth’d about them (?) the prices rallied sharply - and they have since drained out almost all of those gains. That’s what exit liquidity in action looks like: a sudden surge of exogenous demand, being met with an equally eager cadre of sellers looking to dump some terrible assets on the rubes brought in by Trump’s hype.

To be clear, there’s a very slim to nil chance this reserve happens, in no small part because people close to Trump David Sacks got him to overcommit. It’s getting bad reviews not just from reasonable pro-crypto Trump allies like Nic Carter, but even from real MAGA Bitcoin Maximalist apes like Anthony Pompliano. Trump probably could have made a Bitcoin reserve happen! He controls both chambers of Congress! But his crypto industry supporters are David Sacks is going to be sorely disappointed here.

They’ll David Sacks will be even more upset when his shenanigans crash the economy and the price of Bitcoin with it. Oh well!