5min chapter

"Moment of Zen"  cover image

E15: Nic Carter on Balaji's Bet, Operation Chokepoint 2.0, and the Fed's financial crisis

"Moment of Zen"

CHAPTER

The Crypto Nuclear Winter

There's 15 or so banks that are still taking crypto clients with a lot of asterisks frankly they don't just take you off the street but they don't want their names at all mentioned in their context. The executives of these banks will onboard crypto firms within certain constraints already mentioned the 15% deposit rule and also get daily calls from FGIC demanding lists of their crypto clients. Nick: On a mark-to-mark basis these banks are insolvent and that's just a very plain mathematical function of rising interest rates Rising interest rates drive down the value of bonds mathematically someone has to take that duration risk the risk has to go somewhere it's banks that normally take it.

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