How to Combat Illicit Finance Without Killing DeFi | Rebecca Rettig & Miller Whitehouse-Levine

Transcript

not all or nothing you know we can have completely permissionless protocols only using permissionless assets and as long as people retain the ability to use those in my opinion uh why not have uh folks have the option to use permissioned pools or permissioned assets which as you mentioned there is clearly demand for this episode is brought to you by Chain analysis the leading blockchain data platform that powers investigation compliance and risk management tools used by both businesses and government agencies around the globe you'll hear more about Chan alysis later in the show welcome back everyone I'm really excited uh it's been a while since we did our last regulatory pod and a lot of

things have happened since and so now we're joined by Rebecca again she uh if you've been under a rock she leads policy she's Le what is it the chief policy and legal policy offic legal and policy officer polygon I still can't can't get it right after so many years we've known each other uh and we also have Miller who is the CEO of the defi education fund which is the only uh specific organization that is advocating for Defi and so it's great to have you both on um I know we want to cover a paper that you guys recently published as well as some of the rulle making that is making a lot of headlines today around um you know the SEC so uh guys welcome to show um if you guys want to

introduce yourselves we can do that and we can jump into the discussion sure thanks uh well as you said uh Rebecca rig Chief legal and policy officer at polygon Labs um so as to not bore people who've already heard other regulatory pods uh I've been a lawyer for a long time but I've been a lawyer in the crypto space for a very long time and is s and I go way back to before we all called defi defi um where we were really trying to figure out these new permissionless systems I don't even call them peer-to-peer honestly think they're just intermediary lless systems um that mostly allow you to interact and engage with software and and so worked a lot on how to counsel software developers on

regulatory concerns from a very early stage so defi is something I love I'm on the board of the defi education fund uh and it's one of the things that I'm most passionate about and seeing all their work both in the US and abroad so I'll turn it over to Miller thanks for having me I appreciate it uh there is a lot going on in the policy scene our role is to hopefully uh figure out smart policy such that crypto lawyers have good answers for their clients which is uh not an easy task obviously the absence of intermediaries challenges the traditional approach to regulation in financial services uh pretty

fundamentally and as governments are struggling to figure out what to do our job is to educate policy makers and advocate for policies that are going to be welcoming of uh permissionless def5 protocols and people's access to them so that is our role and uh Rebecca's paper I think is an important uh development in that debate so before we jump into that uh I'm curious for like when did the defi education fund get started who's really behind it in terms of I assume a lot of funds A lot of people that have invested stake or um and protocol is I'm curious if you could just give a brief overview on on that yeah we have a very defina native origin story it was

originally conceived and uh funded by a Unis swap Dow governance proposal in mid 2021 so uh we are the only crypto advocacy org and I think only advocacy org in the world uh that was initially created via ad Dow governance Bo so that is uh how we got started great right and Beyond Unis swap I'm sure there's a number of other D5 protocols and funds that have backed you if memory serves me right yes and hopefully more still more still I think people will start seeing more governance proposals out there um I think the interesting thing I'll I'll

give a little kick to Miller because he's he's not gonna self-promote too much but I think the thing I think the reason the defi education fund is so important is that the work that happens behind the scenes is twofold and then there's sort of work that we see so the work behind the scenes is twofold is meeting on the hill meeting with Regulators globally doing that type of education the other thing that I think the defi education fund does that's super fundamentally important to the way defi is perceived is that Miller and the defi education fund um does a lot of work to educate the Press too demos and things like that which I think is really important given the bad rap and that defi somehow you know can become a bad

word even though I think people may use it in a way they they don't intend to and then I think the other reason the defi education fund is really important and it's super important to fund them in many ways so if people are interested reach out to Miller but is that a lot of the work that the defi education fund has um come to take on is advocacy through amicus briefs uh and the types of impact litigation that's out there so one of the most gratifying things to see as a board member was that the judge in the SEC action against coinbase cited the defi education fund Amicus many times calling us the defi people which is one of my favorite monikers now uh but you know that that Amicus brief really took on descriptions of the

wallet and of staking and of things that are extremely Crypton native um and a lot of the work there is spearheaded by the defi education funds Chief legal officer Amanda tanelli uh but I think the work that DF is doing to educate via amicus briefs and the litigation that's out there is really important too yeah absolutely um should we get into the paper because I think that covers a lot of um um so so this is um I believe you published it late January so January 29th um the paper comes out and it's called genuine defi a critical infrastructure a conceptual framework for combating illicit Finance activity in decentralized you co-authored it

along with Michael Mosier and Kia um who I believe also works at polygon she does yep she's a senior public policy leave and Mike moer has his own bti firm uh called arcturos he's also a partner at a VC called exanti uh but more interestingly for purposes of the paper he had a long history in public service um both at ofac the office of foreign asset control as well as finsen the financial crimes enforcement network was which is the financial intelligence unit at the treasury Department uh and also worked at the doj I think the Genesis for this is really something that Miller referenced early on which is what are our regulations here when you have an intermediary system um how do we go

about this I think the elicit Finance question has been percolating for a while I think it obviously especially hit a fever pitch first with the tornado cach sanctions but that was a while ago and then I think it sort of maintained this Buzz for a while and then I think once uh the binance um uh settlement came down and case came down and then with the October 7th um discussion in the Wall Street Journal about Hamas using crypto to fund its its recent attack it really had brought things to a new level specifically in DC although I'll be honest the EU has been really focused on what to do on the illicit

Finance side of crypto and also as much as everybody's been saying you know me is so great and lating it I think the AML side the anti-money laundering side and those types of regulations in Europe are going to be very restrictive too so this paper was really meant to take a lot of the dialogue we've heard where people have tried to import the old what we call Financial Integrity regime right Financial integrity at least in the US comes from the bank secrecy act um which which regulates what we know as as financial institutions so Banks broker dealers uh certain types of CFT C regulated entities casinos whatever uh and then also our sanctions laws um and try to people have tried to sort of do

square peg round hole kind of thing and say well if we have things that are financial institutions and that's how we combat elicit Finance today let's just do the exact same thing with this blockchain system um and trying to find who in the blockchain system which is fundamentally a software Communications protocol um would be a financial institution and Mike has done great work uh in the past too both on the government side uh and he he was at finen when the 2019 finen guidance came out which was really about how to think about software in the um crypto space uh and whether it would be a financial

institution or be regulated or not so really trying to come up with an answer to things like look we've seen a number of powerful prominent Senators put out proposals on what AML anti-money laundering litig um legislation should be uh and a lot of that brings in the who's a financial institution who's responsible for sanctions violations one of them proposes you know governance token holders may be responsible for putting um sanctions uh controls around defi protocols and I think Mike and I really when we were conceptualizing the paper looked at it if you look at the paper you'll see there's like this whole long section that describes what dii does right and how it works at each

feature right what does the wallet do a relayer it's optional what do RPC nodes do um you know what does the protocol do what does the front end those kinds of things and then looks at the sources of elicit Finance there because right in in the trafi world elicit Finance comes from one having honey pots of data and then two where people are making subjective judgments either about onboarding customers or users or there being some sort of flaws in the system and uh looking at where Lista Finance comes from in these permissionless software systems shows it it's very different and so we wanted to have a framework that one would be super effective two would be in line with what regulation we've SE or guidance we've seen to date from Regulators like the

2019 finsen guidance and three um would be true to what the software actually does and combat the sources of risk where you can find them it's a long- winded version of where of the origin story of this paper but Miller uh to put a bit of a finer point on it um the paper I think is trying to answer and I think is one of the first attempts at even answering uh a policy question that's really fundamental and in in this context in the context of AML which is where there are systems without Financial intermediaries how does one accomplish the public policy objectives we all

support in this context combating illicit Financial Activity one answer which uh is highly problematic is to force the creation of intermediaries where they don't exist so that is uh porting over the traditional old system into this new context and essentially saying you can't uh have intermediary list Financial system uh because we don't know how to accomplish our public policy objectives in that World um so for example Senator Elizabeth Warren's Bill uh would do just that it would say there it essentially says there are not Financial intermediaries here so we're

just going to make a bunch of new people Financial intermediaries even though they don't actually function as such uh so that we can apply these old uh obligations to them and Rebecca and Mike conus paper uh proposes a different way to accomplish the same objectives that doesn't uh mean totally undermining the fundamental innovation of defa yeah that's such a good point and just backtracking for a bit um the big confusion from my standpoint has been when you try to Port as you said when you people are looking at defi as if it were a traditional Financial system and gloss over this idea as you said there

are these protocols that just don't have an intermediary like certainly like you can have key persons that can up upgrade a contract that can be centralized in in in that manner which would be problematic I guess but if you have for instance Unis swap like they deploy V3 or whatever and it's out in the wild like you you it's like they can't control it they can't uh influence it influence these markets in the traditional sense like you but there may be the ability to maybe manipulate a price on chain which is very easy to detect um but of course like for anyone listening to this it doesn't have like a deep understanding of defi it's really

hard to conceptualize this and I wonder like from your standpoint how much of uh how how much do Regulators appreciate the novelty of defi I mean of course this paper like is part of the education of it but it's been a few years where we've tried to educate Regulators so I'm curious if there's been any progress in them understanding um the key distinctions of what defi is versus a traditional Financial system uh I would say that it's all over the board as far as understanding is concerned I think one thing that uh folks in crypto sometimes Overlook is that I think there are many uh for example the SEC and the IRS there are many Regulators that do

have an understanding of the novel novelty of defi protocols so exactly as you just described but uh Just Disagree that setting up a new system to accomplish long-standing objectives is necessary or desirable so I think there remains certainly a lot of uh education to be done like which is the understatement of the century but uh I think many of these proposals are based on a uh full understanding of the Novelties of Defi and a different policy conclusion than we would have you mean the paper is

based on the understanding of the novelty or you think Regulators oh I think some Regulators do understand Defi and why uh like a different approach would be necessary for permissionless systems and their answer is okay permissionless systems are unacceptable oh yes my response to your question Sant was going to be it depends on where you are in the world right uh I had Regulators abroad say to me you know why doesn't the US like permissionless ledgers right I don't we don't like literally verbatim has asked me that question um and so there is an understanding in other parts of the world what this technology does why it may be beneficial um I think that as

Miller said here it's very case specific even if you understand it and understand some of the benefits it it's not enough to outweigh whatever issues you may have fundamentally with the technology is is the issue more so control where because like I mean your question is a really basic one and it's hard to answer like it's like you have a transparent system and if you were to describe this to any historian or or my friends at like JP like Wall Street and you describe a system without saying Defi and you save it till the end they're like yeah like we agree like it would be much nicer to have a system where like you know your counterparty you know like the the like when you

deposit your funds in a or compound like it it's just uh a lot of the issues that are happening in the traditional Financial system like Bank collapses where you don't have really good transparency into what's going on in real time well you wonder well a lot of it could be solved if you all of this happened in an open transparent manner quite frankly the bank secrecy act actually grew out of the fact of the need to for Regulators to at least have more transparency in Banks right because there was lots of uh sort of elicit activity that was going on in the you know yeah 1920s or whatever yeah um I have to remember because we did a whole we went down this whole long Rabbit Hole of um the history of the bank secrecy act uh as we were writing the paper um

and kudos to Kya one of our co-authors for doing that yeah 1970 so I mean same same um but uh you know Banks did not have transparency into who their customers were and so the bank seccy act really out of the need for recordkeeping on who your customers were in the event that um law enforcement needed information so you know some of that should be rectified by these permissionless systems uh where everything is pretty transparent well I mean not to like this episode is not meant to be a criticism of traditional Financial systems we can spend hours and hours on that I mean clearly the proofs in the pudding fail failure continues to happen it's a very not very an imperfect system nonetheless

I think the the focus that I want to go to is illicit activity happens to some extent in open poition of systems in T5 and so could we just address like where are you seeing that uh the the the the amount relative to the total volume that we're seeing um maybe just put it in context yeah so the paper has a section that goes through like where the sources of elicit Finance um one of which we um talk about a cyber risk right if you've coded the protocol incorrectly if it hasn't been audited correctly or even if you do code it and audit correctly there may be this loophole that can exist for many many years right and somebody finds it you know five 10 years even some of

the best protocols with great Lindy effect and things like that there's another um risk called system management risk and we try to do these case studies that highlight them so on the Cyber risk we talk about Wormhole and there was this loophole um uh system management risk uh where where basically the systems are not as permissionless as they are purported to be or there is um just like poor security um around the protocols and through the dev Cod and things like that uh so axi Infinity is a great example of that right because Sky Mavis held all of the you know five of nine Keys needed uh and some of it was just like somebody forgot that they were holding one or two keys and forgot to get them back from them and so there was this social engineering exploit which is

a web two exploit honestly that happens all the time uh and then the last part which is what I think uh plagues uh regulators and policy makers the most is this us usage risk right that you can uh basically in permissionless systems take the proceeds of a hack maybe from a cyber right attack from the Cyber risk Point um and then put them into 50 different wallets and the 50 different wallets can send them to tons of different protocols and Bridge them into tons of different chains and then they can go to tornado cash or things where you can sort of of break the chain of the transparency and not figured out so I think the usage risk and the inability to theoretically try to stop some of the illicit activity

even if you're seeing it on chain because it happens so fast uh and in such a permissionless way uh also is what really plagues him but I don't know if Miller has other Insight from other discussions he may have had about this yeah I think the latter is one that the like D5 folks don't think about as much but I think is like top of mind for Regulators so just some on the one hand you have what I think about as being primary risks hacks of protocols exploits Etc on the other hand you have like forget about the um predicate illicit activity uh but people trying to move their ill gotten gains through D5 protocols itself as being a risk be it

from hacks or be it from offchain elicit activity that folks have uh gotten some money from and then want to use uh crypto or def5 protocols to move their Assets in some way uh the latter being um I think a top of mind uh concern for Regulators that folks in the industry don't think about as much yeah and and to that response you'd be like well wouldn't you say it's it's so so tornado cash which is probably the most problematic right um if all the checkpoints where you're where you know Fiat money is entering defi are are

enforced properly then then you don't really need much you know like if you truly focus on like the the onramps then you don't have a problem because all the theoretically all the money within the system is uh clean to start of course you could have like manipulation profitable trading strategies that are obviously problematic and you can enforce those and by the way it's rather easy to enforce because you're seeing everything on chain like you can't hide this stuff and so it's very easy to crack down on that but I I'm curious um you know of course like there's U reports of like you know the Lazarus group you know

using defi as a you know the constant hacks but also just la like you know using a mixer to you know uh uh you know take money out of the system um how do you solve that or or what is the response to a regulator that might ask you that question yeah great great point so I want to address all a lot of the things you said um just because you know for those of us who are down the policy Rabbit Hole a lot uh we think about this but I I think we need to make some of the things sort of level set before we get into the proposal to so first of all tornado cach was not problematic from day one it was out there existing and being used for actually a number of years well before

the office of foreign asset control imposed sanctions and one of the reasons that it was sanctioned is because as you sort of raised um Lazarus group was found to have uh brought through something you know the numbers are something like 40% of the volume that's gone through tornado cash quite frankly if an overseas bank or even a US Bank was found to have been you know launder like that 40% of the funds going through the bank were being laundered uh by lazerus group or something like that they also would face sanctions now I think what was so novel about tornado cache is that you're sanctioning software and we don't have to go well down the rabbit hole um but you know how do you comply even with sanctions which are really directed toward in as we say

in the paper towards intermed and as we said on this podcast towards intermediaries uh and persons right so unclear what the blocked property is unclear what you can do it's I think that's really been the biggest problem um because one it's permissionless and so who does it really affect so I think the Tornado cach part is very very complex on the on andof ramps and the transparency Point those arguments are over we've I think a lot of people tried those for very long time and much and still are talking about the fact that it's one of the best places to capture elicit actors and agree uh I think Miller and I probably both agree with

you in many in many ways but that is not enough anymore for a couple reasons one of which is even if all the us-based exchanges a coinbase a kraken a Gemini whatever are really compliant they are all Money Services businesses um and you know are BSA compliant and really doing their best uh to do kyc AML all of those things the offshore exchanges are not compliant and we know that and the financial action task force was which is the international anti-money laundering regulator has basically said that that in this kind of stuff I think there's like 17 to 20% of compliance worldwide so you know Lazarus is not trying to like offboard through coinbase us right

they're offboarding through some non-compliant probably small exchange um somewhere else in the world and so just trying to say like well regulate the on and off ramps like you know um I think that that's that just doesn't win the DAT doesn't fly so also there is no obviously Universal agreement on who should be in and out of the system a Russian right crypto exchange doesn't have the same idea or uh the Russian government doesn't have the same idea as to who and what is an illicit actor and illicit activity as the US government does uh so I think that it's a more macro struggle that governments are

having like the US government is now dealing with this Global permission lless Network in a world where we have different sovereigns with you know different ideas of what is is not acceptable I also think it's I also think the the quotequote ring fence only works in a world in which crypto cannot be used to buy goods and services and uh today you know that doesn't happen on mass but uh in the future hopefully there uh will be you know Mass use of crypto for buying goods and Serv services and uh you know I think we should be skating to where the Puck's going a bit Yeah and honestly the transparency Point we've all tried to

use that and there's even a section of the paper on it like after we go through the you know Michael Ki and I go through the elicit Finance um risks we do talk about the benefits of the transparency and we do this case study on something called Welcome to video which happened a long time ago where the IRS really relied on the transparency of blockchain to bring down sort of large child pornography ring overseas and they are still still catching bad guys in that ring to date so and I think law enforcement would say um and it's unfortunate Michael's not here because he does work with a lot of people in law enforcement still on behalf of his clients that the transparency really helps um and but and one of the things this proposal tries to do is to leverage the transparency to

get the information so that it's available to law enforcement faster because some of it is tracing just takes a while right like no matter how many great tools that are out there um it takes a while I think the one great benefit of the transparency is with respect to speaking about the proposal in this paper and just elista finan since that's what we're talking about is within an hour of a hack let's say you can identify where the like which wallets were immediately identified right um or immediately you know involved in it and so I think making sure we highlight some of the benefits of the transparency as part of a larger um a larger framework is beneficial but like that and the offramp alone to Miller's point like that's not enough

and we have to sort of you know give them something more and look the depu the deputy treasury secretary in November put out a letter to the Senate Banking Committee saying listen we really have to do something about this fintech illicit finan Pro Finance problem and then went on to talk about uh crypto potential options in terms of how to fix illicit Finance uh and then also spoke the next day to the blockchain association uh membership at their conference and said you guys got to give us something like help us help us help you kind of and has been saying that for a long time and so I think that also really spurred myself and my co-authors to say like

fine we we gotta we gotta sit down and think about something and um I I will say because I I bleed for defi uh I didn't I didn't do anything over the holidays because I I really wanted to think like what's viable and what's going to be helpful and so I spent my my holiday is doing this chain analysis is the Premier blockchain data platform crypto businesses financial institutions government agencies regulators and policy makers all utilize chainalysis as data and services to make sense of what's happening on the blockchain Chain analysis demystifies crypto by providing industry-leading compliance Market intelligence and investigation support for all crypto assets for organizations

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think at the heart of the matter is Miller you alluded to this is you can't push policy of a sovereign on chain like it's hard like not everything is as black as white as Lazarus group you have enemies of the state that might not be enemies of other states and so it like that the heart of the matter is control like if you're operating in the Swift Network like you know you can shut down stuff easily because it's a it's a delegation of people that control it at the end of the day the US has a lot of way in that not so much in defile so what is the like what is the solution to that because if sounds like there's a like like group of regulators that are always going to oppose any system that

they can't control and that is defi so is there a solution or a compromise there is a compromise I mean we have to come up with something these things aren't going away and this problem isn't going away uh from you know both government and industry's perspective um so I think that it's time to figure something out uh you know the Swift example I will say is a very unique one because uh Swift is really de facto Exempted from a lot of the obligations that we've been talking about here for traditional Financial intermediaries because it is supposed to be neutral infrastructure that folks all

over the world can use and that's why it was uh you know quite controversial the debate around Uh Russian financial institutions access to Swift uh in February of 22 so uh you know there has been I suppose Swift is an example of compromise coming together in a in a way but I it will have to be different of course in the context of because in practice hasn't Swift been like the way you enforce sanctions what do you mean Swift or like a prim like a primary mechanism to enforce sanctions on uh whatever the United Nations security Council or you know G7 agrees on is an enemy of then then you can really when you shut down a

government's access to the fin like Financial Capital markets and so you enforce sanctions no oh sanctions yes I thought s Russia is a primary example recently like it's through Swift like you shut down Swift and it's like oh yeah good luck for some of it I don't I personally this is where Michael would be great he probably knows how many times Swift has been used uh through this sanctions mechanism so I don't know that off the top of my head but yeah I mean look sanctions are meant to deprive uh illicit actors of US economy essentially uh and US trade right and just hurt them from a financial perspective so you're right from that from that perspective for sure which is exactly why many governments are attempting to come up with their own payments networks uh such

that they do not have to totally rely on us financial institutions yeah most notably Russia China and a few other countries China is is also pushing theirs out to Russia they've just been settling their tra China Russia trade through the digital W which for me is more of a reason to make sure that we do a good job in the US uh and that we continue to see the proliferation of US dollar backed or US dollar denominated stable coins uh and make sure they can sort of uh continue proliferating out in the world because I think China uh and Miller can speak about this too very clearly like there is a longterm plan from China to undermine the US dollar I think that um dayto day

it doesn't feel like it because it's a slow burn like I think and Miller has spent time in China and things like that but I think that they're willing to just sit it out until they can find a way to longterm um you know overcome the US dollar and I think that and most interestingly the bank of international settlements uh has a pilot project with the ability for different countries to settle trade in various cbdcs and notably they include China and Hong Kong in this uh and like Thailand and one other uh and I thought that was really interesting from an undermining Swift perspective long term because sanctions won't be as strong if you don't need

Swift as you said yeah I want to bring back to Center uh you conceded like yeah we need a solution Rebecca you spend the holidays thinking about a solution or Solutions I'd be curious to understand what those are or what like what they what did you come up with so uh the paper uh that we put out um is as you said called uh genuine defi is critical infrastructure and it really seeks to answer a lot of the questions that people um and especially regulators and policy makers have put out about defi I think one uh and we've seen a lot of this uh from Regulators as questioning whether th whether defi is really decentralized uh

and so we really had to address that in the April uh elicit Finance risk assessment on def5 from the treasury Department they basically said there's tons of this that is not decentralized that's a huge gap and we need to figure out if they should be regulated as financial institutions so that's one question we wanted to answer the other question is well how do you make these permissionless systems that you know don't have maybe a a more centralized aspect to it what do you do with them what how would you even be able to make sure they are safe for use and the last part really looks at um where have businesses cropped up within the defi ecosystem where there may be benefits to achieving the types of goals that the

BSA looks to right doc documentation detection and deterrence or prevention um without making these technological service providers into financial institutions right completely subject to the BSA so one of so that's it's a three part three-part framework um the first two parts really emanate from this paper by three academics that just came out at the end of 2023 called on def on Defi and onchain CI um we've cited in the paper a it's by Katherine Schuler and Sophie cluts uh and Fabian sh and and Professor sh is at the University of bosel and actually has been writing a lot of scholarly work on defi he put out

this really interesting paper on defi a number of years ago through the St Louis fed um and he's also put on put out great work on tornado cach and just thinking about a lot of these different issues um and because we wanted the paper to be extraordinarily incredible and well researched we read a lot of what is out there we did a full lit review um both of maybe Pro defi articles anti- defi articles that have come out and a lot of regulators work which you know may be in a more neutral or anti- defi Camp uh so we did a lot of work but the in the in the Schuler article they have this distinction of something called onchain CI which are smart contract based systems that look a lot more like centralized systems so that there is some sort of intermediary

in there versus totally neutral permissionless infrastructure which they call gen in defi so in order to think about these distinctions which I think Michael and I agreed were really a good way to look at it and to think about like okay well where are things sort of decentralized in name only or not real defi um we wanted to pose a definition of control that would put something into the onchain CI camp and the definition is based in the 2019 finsen guidance which came up with something called total independent control uh and really looked at that there um and total independent control I mean we do independent control in the paper that is based really on the ability to

affect value um so in the paper we say independent control means for a blockchainbased software system that allows for financial transactions the unilateral ability to exercise operational authority over any third party's value or otherwise immediately affect the value within the system and then or admit permit restrict deny or modify those who have access to the system or the ways anyone can user access the system uh and I will say uh and we you know we put this paper out as like a start of a conversation right this isn't an industry consensus um it's not everyone signed on to it or things like that I do think there's a lot of um

positive reception to it both on the industry side and the policy side because it's just something out there that really is meant to be uh honest about one the risks and two uh what the technology does uh and is meant to be novel and I think all of us have been saying for many years there there's got to be technological solutions to this and this is sort of the first paper out there that says here's how to do it but anyway the independent control um definition is over Broad and we have definitely heard that it may capture people uh that are running emergency multisig or something like that right because in an emergency an emergency multisig with very limited powers could shut down an entire smart contract based system that allows for financial transactions um we Tred to be extremely nuanced and say this is a two-part test

one is there independent control if the answer is yes then you go to the second part of the test and you say um well what what is the controller or the system control person doing an emergency multisig probably doesn't fall under this needs regulation um you know is a financial institution question uh but it's really a facts and circumstances based analysis which is totally consistent with the way finsen has looked at who's a financial institution that must be regulated for a long time uh so we took this original concept from the finsen guidance and just built it out and tried to really have a definition that did capture a lot of what happens um in defi that makes it you know have sort of an intermediary

maybe not in a traditional sense but in a can affect value sense um and so that's that first part of it and that's really meant to be the Gap filling for these calized to name only kinds of questions and on on this point I think it this definition could be thought of as draw like putting into precise words a un amorphous understanding a lot of folks in Industry already have which you alluded to a couple of minutes ago talking about uh a protocol where governance or persons have uh a lot of powers over a smart contract versus one like completely immutably launched you used un swap as an example uh like folks have a a um gut sense that there are

differences there and probably I mean regulatory differences as well and this definition is trying to put to words that uh kind of a morphous understanding of the differences uh between those kinds of systems like for just clear examples on one side of the line versus the other I launch a Comm completely immutable smart contract and and that's it there's nothing I can do it's going to be the same forever obviously uh you know I don't have independent control on the other hand if I launch a smart contract where I have you know complete uh uh ability to change any part of it at any time then I do have control over that smart contract and any person's

value that's in it uh which would clearly be on the other side of the line I I wonder like how do you see the one I mean it's an election year which is difficult and Jake had a really good tweet about this today usually it's slow to get any reception or anything done um but I'm curious um if there if you think of other like what is the the year look like um or from your standpoint what are some of the things that you can continue to do and you mentioned you do not work not just in the US other countries other places seem to be more friendly towards defi so how much of this is an effort to

convince or you know win a battle in the US because all the other countries are on hold because the US still has a lot of weight um and if there are other Solutions or things that you guys are focused on yeah so there are two other parts of the framework though like the control is just meant to answer that question I think as Miller was saying for something like a Unis swap which is genuine dii um we've proposed that it fall under the remit of something called the office of cyber security and critical infrastructure protection in the United States it's under the treasury Department it also is part of what uh is called cisa the uh cyber security and information security agency

which falls under the Department of Homeland Security um there are a number of different types There are 16 different sectors in the US that are uh thought of as critical farming and agriculture transportation communic ations and of course financial services and then a few other Healthcare things like that um so critical infrastructure for transportation is something like trains and rail Railways that take people around the world Airlines things like that and the software underlying sort of the airline schedules and the train schedules same thing with the way Financial Services works today um even like cloud service providers who host servers for like Goldman Sachs uh are thought of as you know providing critical infrastructure for a critical

SE sector um and so we proposed that genuine defi to the extent it rises to the level of being so vital for US national and economic importance uh and security um be thought of as critical infrastructure as well and OIP even though it's falling within the remit of the Treasury Department is not a regulator doesn't oversee all financial and only financial institutions but what it does is it takes and Aggregates information it and it pushes information out in a way that has meant to be extremely collaborative uh there was actually a hearing at one point about whether sisa and all of its sort of sis sister agencies or divisions uh should be regulators and they literally came out

and said in a congressional hearing like we don't want to be made or turned into a regulator we'll stay this agency because we can't be as effective if people are worried about their being like teeth that they're going to get pulled in for enforcement if they don't abide by cyber security best practices or don't do uh or look at the Trends and typologies for different types of threat actors to software under like right somebody could shut down um all sorts of systems there's this um not to talk about competing podcast but there's a podcast called The Lazarus Heist um which is really really interesting and it's two seasons and it goes through all the different types of software systems that Lazarus has hit including things like like yeah sure we all talk about it with crypto but they've been everywhere

right like they shut down all of Warner Brothers uh in a way that I thought was like way scarier like laundering um supposedly laundering crypto through tornado cash um and so the same would be true so if there was like an incoming from Lazarus or something like the banks or two Banks uh OIP this office of cyber security uh and critical infrastructure protection would like call some cesos of a bank um and one of the questions we've gotten about this part of you know genuine zi being critical infrastructure people have said like well if these are really permissionless systems who are you going to call right like most Regulators not just in the US but world worldwide keep saying like who are we going to hold responsible like there has to be a responsible person we can't have this otherwise um and I think the way

oep does it is it pushes this information out which says like here are the things that and the ways people can do it now you may not be able to call every ceso because that that just may not like a a ceso of a devco who developed you know a genuine zi protocol may not be able to do anything um but I think for what oep does over and over um they they will know how to bring this forward and also learn who you can call one of the other things that OIP does is it has an information uh sharing group um the fs the financial services ISAC and there is definitely an effort to create a crypto ISAC and so I think a lot of the work that people have been doing in the

space too to create these cyber security Frameworks to create isacs things like that will really get turbocharged by OIP uh and then the last part and then we'll get to your question about like what could we do in the US this year versus somewhere else and Miller is really well poised to talk about that the third part of the framework uh proposes a new category of something called critical Communications transmitters what we call ccts and those are uh basically service providers who are running a business and who are both necessary for the transmission of communications about a defi transaction and transmitting a material portion of those now people

have asked well who would be a CCT um and I think the RPC nodes as a service providers are probably ccts we say that there needs to be new legislation to basically give finsen authority to regulate these ccts not as financial institutions Michael is always big on this as am I but really really not as financial institutions but as being in this Gateway and you'll see there's um there's actually like a a defi graphic in the paper and as in a big version of it as an appendix and you can see that they are this Gateway between uh sort of the liveness of a defi transaction right as it goes through like all the different software components of what we

think of as defi systems it's the Gateway down to the you know settlement layer to the blockchain where you can have finality of your defi transactions uh and they they won't have kyc information and that's not what we propose but they are having this constant flow of information for for a material portion right of defi transactions and what I will say uh and giving some of the blockchain analytics companies credit is they have this wallet risk scoring system that takes all this to to go back to your transparency Point takes all the information that you can see on chain and talks about sort of what wallets are higher risk than others right like my very basic wallet that I spin up today and do nothing with probably a zero you

know uh a wallet that just did a transaction through tornado cash probably very high I don't know what they rate it but you know well above five probably close to 10 and so whatever the regulations come out to be you could have it so that these ccts are blocking transactions off from high-risk wallets and then autogenerating reports that go to finsen um that have things like wallet ID transaction hash not all um not all RPC nodes have I IP addresses so you wouldn't necessarily have that you could have time and stuff like that and even to your point okay maybe you could see that and see high-risk wallets um on blockchain dayto day but this would be realtime information going to finsen that that could then be pushed

out to law enforcement in a much stronger and quicker way so it's really meant to be this like very comprehensive um and pretty realistic and also very effective framework for thinking about defi without as we all said defaulting into well who's the financial institution here when really it's all software give it to me give me the hard stuff no I don't Miller any you want to add anything to that nope why don't you talk about I mean can we do any I think the what can we do with this question is a is a good one um I've been on the hill since we put it out uh Michael has been speaking Michael

moer has been speaking to a number of his um you know government contacts uh still um we are talking to Regulators all over the world about it um look it's the beginning of a conversation I think we need to hear both from industry and from regulators and policy makers about concerns way ways to make it better um where they think there may not be efficiencies um but I do think that there is a lot of appetite for things like this and I would encourage people to be working on these ideas and putting them out there for for public consumption and discussion because the more we see like we are really trying to

work together to get this issue I'm putting it in air quotes Under Control uh the more the better off will be from a long-term perspective but I'd love to see more stuff like this and a broader and deeper conversation with other ideas so what is uh Circle and coinbase's role in all of this I mean I think when I hear all of this I think of usdc as initially it was very controversial amongst a very utopian impractical cohort within the crypto Community I remember trying to onboard it as collateral for maker and it was highly contentious now it's the more along with Tron um the like the most widely used stable coin uh you know in

tether but like usdc can be censored um you know a lot of when these hacks happen most recently like Ripple's one of Ripple's co-founders like you can freeze these things right uh of course there are ways by which uh these elicit actors can like very quickly turn and swap a usdc to I don't know a more censorship resistant asset if you will but like I think the market is telling you like they don't necessarily care as much about this censorship resistance it gets talked about a lot but like defi is still very much like like a an experiment and I guess like the things that have gotten the most amount of

traction are not pure censorship resistant things it's like usdc just works and people want to use it I've long held a view that we're going to see hybrid environments when I mean hybrid sort of like a a system where you're relying on the execution on a base layer that is as decentralized as robust as ethereum or salana or Bitcoin but you have have a layer on top where there is more control there is more you know you know who your counterparty is like realistically if you're gonna have a JP Morgan and Goldman do stuff on chain they want to know who their counterparty is potentially only operate in pools of

liquidity where they know exactly who else is in that pool you know we've had instances of this compound try to do it and then kind of didn't go anywhere but like a Arc and then you have l2s that are like potentially base I think of or Kinto and like if you fast forward 5 10 years from now like we're probably going to see the most amount of activity in these type of systems just because that's where the most amount of liquidity happens probably the better products happen everything else just becomes more and more marginalized and more cumbersome to operate in and so that may just be the solution where the market solves it because that's where things are going you're going to

operate in this like corner of the world of defi that you know is pure then you know there's not much to do and if you're operating there then it places a huge like Target on your back that you're clearly there because you may just be doing like um you know illicit stuff and you wouldn't want that right I remember funds that held zcash if you blinded if you shielded your zcash you would have gotten a knock on your door pretty quickly because very few people were shielding zcash before it was by default so you Monero got delisted recently so I don't know like it's a bit of a rant but like I'm curious if this is something where things just you know

the things that get the most amount of traction are ones where Regulators have much more comfort in um to have some sort of degree of control as you alluded to implement some of these like systems you're talking about yeah I think on like the what role does a coinbase or a circle have they are the intermediaries and so they are regulated and today as Money Services businesses uh that do have to comply with the bank secrecy act and they have money transmission laws uh money transmission licenses in various States and we've seen them all getting licensed all over the world um I think on the defi as an experiment and I I think I can speak for Miller and he will

certainly speak for himself after this it's some of the most exciting things of what could happen here right like this is where there will be a lot of change and promise not only but I think if you know defi is done right there's a lot of greatness that can come from it and so I think figuring out some of the answers to the hard questions first which by the way doesn't typically happen uh in in uh regulation or in Tech um but I think having to figure out an answer to this question will allow things to really move forward from a long-term perspective with t yeah I think I think your your rant as how you described it was on point I think the beauty of permissionless tech is that people can

use it and uh use it for applications in different ways and however they want to if you want to use usdc a permissioned asset have at it if you want to use a permission pool will have at it if you want to deploy a permissionless uh pool all the better too I think it's I think the beauty of this technology is that number one folks can do that and number two those worlds or those conceptions of defi can coexist and I think the we shouldn't be afraid of that uh it's not all or nothing you know we can have completely permissionless protocols only using permissionless assets and as long as people retain the ability to use

those in my opinion uh why not have uh folks have the option to use permissioned pools or permissioned assets which as you mentioned there is clearly demand for I think we we shouldn't um uh forget that different conceptions of this Technology's application is uh can coexist and is a key feature of the tech itself and uh we should welcome that yeah no absolutely and I didn't mean to I mean I I'm a strong believer in d5s using it way back in the day and you

know uh uh you know I I totally agree with you I mean there should always be the freedom to interact and like with and and right code uh you know that is you know permissionless if you will and that guarantee is really strong if you're interacting in a in a protocol that you know can't be controlled controlled corrupted and that's that's super powerful that's why that's why we do this otherwise go back to using the traditional Financial system uh but uh yeah I I am just struggling to see how we I mean I think right back to your point this is an area where um you know we could use a bit more

funding to iterate and build solutions that something the more sophisticated more real time that uh satisfies some of the kind of concerns of regulators worldwide I think that's a big opportunity um and look this framework that we put out isn't it's not the only thing it's it can be complemented by so much look to your point just even about stable coins and thinking about how important they are in defi um there's a lot that can be done there just just thinking about that too so um I you know as I said before like this is this paper is the start it's not the end um hopefully we'll see traction hopefully what we'll really see is people taking a

step back and thinking like okay this is a new system we actually know what to do with software we've been doing it right like Michael will say a lot when we're talking about what OIP actually has done if there's a if there's an incoming threat from Lazarus they don't necessarily call the ceso of Goldman Sachs or they may call the ceso of Goldman Sachs and AWS or whoever provides some of their cloud services or whoever you know provides services for Goldman Sachs and they bring them in right um we're talking about software um and it just we know what to do and so hopefully the paper will get people to take a step back and look regulating new systems is really really hard um and not just right now um but it has been

historically right usually markets happen and then the regulation builds up around it um and we're seeing some of that now and some of I think the hangover from not regulating web 2 in an immediate Sense on questions of privacy and stuff like that is catching up with web 3 right so we already have we haven't regulated Web Two properly um and as I said I think some of that we've already now moved on to like a new iteration of the internet uh and we're trying to I guess figure out what to do here yeah we are on a multi-decade journey here uh I I don't know if that's a blessing or a curse but San I I feel you're struggling over there uh and I

think everyone you know is struggling to come up with good answers to a completely novel problem and that's going to take a while to figure out um so we're definitely at the beginning of the journey and even though there's not like clear light at the end of the tunnel yet uh that's okay yeah I want to transition into look I don't mean to sound I'm for the purposes of this discussion I am taking kind of the opposite view or the more critical view because this is something that our listeners are probably just wondering right um but uh nonetheless I mean I think the hope that I have and time and time again during this regulatory series we've I believe that I have hope in the court systems um of and that's what makes democracies great um and there

have been really encouraging developments on that front you know across a number of different cases the courts have you know really um asserted you know what is the jurisdiction of these agencies and what is an overreach and I think that's been largely favorable to cryp though um and so most recently I would love to talk about kind of this proposed rule the SEC around like so uh maybe Miller uh or Rebecca whoever wants to give an overview would be great um yeah the one thing I'll say just as we're transitioning out of the illicit Finance question back into the Securities laws in a in a place we're all comfortable I think and thinking about it is courts have been great on traditional markets and um consumer protection questions with respect to

like are crypto is crypto security those kind token Securities whatever when it comes to National Security our agencies have massive power and huge discretion to do things that are for the benefit of US National Security and economic security and so I think coming up with proactive Solutions uh before we have to and look some of it is being tested in court with the existing Tado cash um litigation that's out there um I think coming up with proactive Solutions is something that should be at the Forefront of everybody's um mind but Miller take us take us a home with the dealer rule sure so it is a final rule

as of yesterday unfortunately uh no longer a proposed rule but what the SEC is doing here is the SEC one of the business uh archetypes I suppose they regulate are Securities dealers those are businesses that uh as a business buy and sell Securities with counterparties and uh they are historically regulated by the SEC Under The Exchange act the SEC is redefining what it means to be a dealer uh in a way that is far broader than it used to be it used to be you know pretty clearcut are you in the business of making a market in a security if so uh then you

are most likely a dealer that needs to register with the SEC they are now uh have now finalized a rule that would make that um uh concept far more ambiguous to include those persons who uh are engaging in trading activity that has the effect of providing liquidity to the market which of course any single trade does um so it in my mind is a part and pars or another example of the SEC redefining uh its remit in a way that is ambiguous such that they can uh ad hoc enforce those rules and um do so in a

way that surprises people the the underlying um uh the underlying Ridiculousness in my opinion of this whole proposal when it comes to crypto is that but uh yet again the SEC is skipping over the core predicate question the core predicate issue that for 10 years uh they've known to be a problem which is in the in crypto what is and is not a security because to the extent an asset is not a security then you don't even need to be thinking about whether you're a dealer or not uh under the sec's regulations they like to paper that over and say you know based on the facts and circumstances you may or may not be a

dealer based on the facts and circumstances around what assets you are touching and if at any point in that chain of uh subjective analysis we disagree with you you are going to be getting enforcement action um so it really is uh in my mind I think the SEC almost applying a crypto uh their crypto strategy to the broader Capital markets and uh while crypto has specifically called out I think it's problematic for the entire Securities markets uh and there has been robust comment on the rule from both trafi and folks in crypto um I think for for defi specifically the

effects would be secondary in that uh the oh well I I suppose there's one area where it could be primary which is if the SEC uh you know and knock on would uh it would be a stretch even for them claims a an amm pool itself is a dealer uh but I think the the more realistic take on how this uh rule would be weaponized against defi is to go after major participants uh is the is the 50 million Collective or individual it's individual but the problem is it it's it um only applies to this rule so basically it'll

say you could still be even if you fall under 50 million you still fall under the old SEC jurist prudence and the court cases which basically say you are a dealer so I think the final rule doesn't fully exempt you if you're under 50 million but you know they say that themselves they say we are defining a dealer in this way and even if you don't meet our definition you still may be a DE deer yeah yeah and I I I know they do go they did go on during the meeting yesterday to basically say look we're not if you only develop software you're not necessarily a dealer by itself I don't know if I think that the the

effects are secondary fine maybe software Prov maybe software developers themselves are not dealers but I actually think the effects are very primary because it it does what I think the SEC has been trying to do which is to scare people out of participation like who who's gonna LP into any pool correct that's exactly right so I think it is meant to look it's the same as what they did in a lot of the exchange cases fine they went after the exchanges but a lot of the tokens they named as purported Securities were L1 and L2 tokens right um even just gas tokens because they wanted to restrict the usage and I think this is intended to restrict the usage and they are looking at backdoor ways to try to cut off the lifeblood of the industry

and say a lot of what we were talking about right now right like the promise of defi is that I can be an LP right um You can be a market maker like and earn fees and like yeah yeah well and that's one of the ways they actually Define somebody as a dealer is if you read deep down and you know defi they're saying if you get LP fees then you are also a dealer sure you're facilitating liquidity so like no matter how what size and this 50 million is just meant to be just right your size doesn't have to be size Size Doesn't be sized because maybe it's a percentage of the pool or maybe it's like as you as you pointed out if you're a dealer you're a dealer doesn't matter what size like that's just falls under the old definition which there's a whole precedent around

them they can point to that it's just been so erratic so um yeah like Jake had a good take you know I retweeted him and he said the heart of the matter here I think is the SEC versus coinbase coinbase obviously in that battle they are arguing that digital assets are not Securities so to your point Miller if these are not Securities then there's no like this rule doesn't apply they're not Securities exactly right so if you win that um then there would be all of this would be largely irrelevant well the the strange thing when you read the dealer rule is that you feel very gaslit um consistent with I guess how the industry has felt for a long time because they're like we've had

many letters from people in the crypto asset space saying you know they don't want to have to comply to this Rule and it's like well no what they actually said is we don't know which C assets are securities so we don't know how we could comply with this rule it's what everyone's been saying the whole time um and so I think that you know when Miller is saying this has secondary effects I think it's probably right it it does because the primary effect is the same as everything else which is we don't know we don't know who this applies to like does it apply to the I don't know unty is is is is problematic yeah and it's the point for that yeah that's whole point that's a that's a feature not a buck yes that's right

um what's been the response uh or the from your clients funds I'm thinking like the jumps of the world or even you know my former house like of course we did a lot of stuff on chain I have heard a lot of funds stop voting this has been for years now yeah based on ukie or something like that yeah exactly SX uh or the that Dow so of course you pierced the veil of you know basically said the Dow is you know there's no protection there and now of course this would be like then who wants to provide liquidity on chain or even staking like uh if you're staking your tokens how is that a

potentially a dealer too like I don't know like re like reaking isn't that like like I know that's for security reasons but that's all also liquidity could they take a even stretch it as far into some like igen layer even though IG layer would attest we're not we're not here to this is not a def protocol this is a security protocol infrastructure but uh I don't know like look not to bring it back to the paper but like that's why calling these things what they actually are will allow you to put together a both a uh a practical and an effective regulatory framework right if you keep calling something you know if if you keep

calling something something that it's not right keep saying validators are financial institutions it doesn't make it true just makes it it just maybe helps you longterm accomplish a goal of restricting usage of the technology um and that's why the the paper is really really tied to what the tech does and and what we do with tech in the US today well I know we've been at it for a while uh parting thoughts and then also would love to give you guys an opportunity to you know shout out to like encourage our listeners and ways that they can help yeah uh there's a lot going on under the hood you guys are playing a huge role in that so yeah Miller take it closing thoughts I

will reiterate that this is going to be a long journey and I think it uh I'm glad crypto is so focused on the regulatory situation um I think more investment in it is going to pay off over the long term we need more folks working on all of these problems that are not going to resolve themselves uh second to Rebecca's Point definitely we need more ideas out there you know I think crypto broadly is very good at saying that doesn't work that's stupid uh you know we're good at saying what not to do and there's a dir of good ideas about what to do um and think there are lots of good ideas I think

people are really afraid to put them out there I think crypto Twitter I I really stealed myself for crypto Twitter when we put this paper out and I said it's so important to put a new framework out there I'll take whatever heat I get right like um and I think we all so I think there actually may be lots of good ideas I think people may be afraid to put them out there so I think reach out to Miller or me but whomever and think about the best you know to just talk about how to put certain ideas out there so I sorry I just to put a fine point on that I I look I backed today I did one of my largest deals in in the compliance uh sector yeah I think it's a huge opportunity yeah yep there is uh and then the last thing I'll plug

is we are co-hosting with the near foundation and salana Foundation uh boot camps over the next year to give industry folks who you know know policy is important but don't think about it all day uh the the Run down of what's important what's not and most importantly how to be helpful and engage in the policy debate around crypto so encourage folks to uh sign up for those boot camps which we will probably be having for uh the foreseeable future yeah our next ones yeah I just want to say our next ones are coming up there are two in March one in Paris one in London and then we're going to do a series in consensus um and it's really

cool because every time we do a boot camp we have somebody else new from the industry reaching out asking to sort of co-sponsor and co-host so it's really bringing together the industry like the policy question does bring together the industry in a very serious way which I find encouraging M do you do you uh think you have enough resources no we don't Al you just said you're this is a long battle so like you need to be funded for like 30 years um yes no I mean like order of magnitude like how bad is the way to think about it is the crypto Lobby spends about 15 to20 million a year in total and the traditional Financial system which we are trying to

upend spends over a billion a year on just lobbying and government relations so there is a Delta there that uh is in need of uh filling we have fourfold and uh there's a lot of problems to to address this is this is a proposal an idea I just had so like we got to end the episode with a proposal right I've been sitting here like an idiot um for every airdrop every project should allocate a certain percentage of their total token Supply to lobbying efforts slice it however you want it can be of course the defi

education fund it could be the blockchain association all of them but like if every project air drops um 1% or some percentage basis points whatever it doesn't have to be certain amount but if we codify that or as investors we put you know we encourage our teams to do that then yeah like like vitalic at one point you know you remember when he donated a lot of the ship he got and it was like a billion dollars or something and then you know to India relief efforts I mean of course I don't know if they liquidated the full billion like maybe it was a fraction of that but it's still a lot uh so yeah I think it could be a good idea the airdrop like if if you got help if you were part of a boot camp or have

received some help um then I think it's um you know I'm gonna tell you anybody who loves defi has received help from Miller whether they and the defi education fund and Amanda and all the whole staff there whether they know it or not um because they've H you guys haven't seen all of it but their Amicus is they have Amicus in coinbase they had Amicus in tornado cash they had an amicus in a big um case on privacy like the things we fundamentally care about from a Crypton native ethos is what underpins the defi education fund so everybody should show I know I'm a board member um and so I'm biased but like it's okay you're allowed

to Shell it's okay I shill very rarely but um but uh I just think it's an important organization to donate to and there are lots of ways to give uh and I'll say this um the ideas thing like fine I took time out of my life as did Mike and Katya to write this paper uh and it really was a Blood Sweat and Tears Endeavor but I don't know when I can do it again right like I have a real day job and other things that I do and we as Miller and I both said we need these things out there like a dedicated fellow somebody who can really be working on these questions I mean um there is a lot to do and as Miller sort of made clear there's a huge Delta between who's doing it in the tradition Financial Services world and who's doing

it and how much of it is happening in crypto so a lot of great work being done by the coin bases other big VCS um and but it takes a village and we should expand our village so um donating time effort and money is really important yep absolutely um well that's great well that's good as any place to end it thank you so much for coming on I know um you know it's it's a lot to work through and we covered probably 5% but you know hopefully we can continue to cover these things and and surface them and really encourage people to um to help not just with capital but you know resources um and I think it's imperative any protocol not just defi it touches everything yeah um so um really

really great work that you guys are doing Rebecca and you thanks for coming on and and really sharing your thoughts I really appreciate it and hopefully the audience found it useful so fun to chat as always Sant we should we should record one of our lunches and actually just put that in as a fun I'm not sure about that but uh yeah I'm happy to keep doing these regulatory series Miller always welcome to come on uh it's great to have you on for the first time but everybody knows we like to have made it you've made it that's right you made the cut yeah we probably should have had you sooner so apologies on all right well thanks for having [Music] thanks

yeah