Zeke Faux, Bloomberg News Financial Investigations Reporter, discusses his book exploring the crypto bubble and the ongoing financial mania surrounding crypto. They also explore investment fraud, dark reality of spam texts, and the phenomenon of the board ape yacht club during the crypto boom.
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Quick takeaways
The author's investigation into the crypto world reveals a landscape filled with scammers, conmen, and bankrupt founders, making it challenging to find legitimate cryptocurrency companies.
The podcast uncovers a new form of investment fraud called pig butchering, where scammers use spam texts to deceive victims into sending stable coins, resulting in an estimated $10 billion lost during the crypto boom.
Deep dives
The Adventures in the Crypto World
The podcast episode explores the author's motivation and journey in writing a book about the crypto bubble. The author shares their initial skepticism about crypto but becomes intrigued after encountering wild billionaires, hustlers, conmen, and scammers in the crypto world. They spent two years immersing themselves in this chaotic space, witnessing the rise of crypto mania. The author notes that many founders they met during their research now face legal issues or bankruptcy. While acknowledging the possibility of good cryptocurrency companies, the author expresses skepticism about sifting through a sea of scammers to find them.
Crypto Romance Scams and the Dark Side of Spam Texts
The podcast delves into the discovery of a new type of investment fraud involving spam texts, called pig butchering. These texts initiate conversations where scammers pretend to be attractive individuals with crypto trading knowledge. They lure victims into sending mainstream stable coins to unknown crypto apps, promising lucrative short-term node trades. The podcast reveals that people lost an estimated $10 billion to crypto romance scams, with many falling for this deception during the crypto boom. Moreover, the author unveils the disturbing truth that individuals sending these texts often reside in Southeast Asia and are trapped in a human trafficking operation.
The Silly Side of Crypto: Board Ape Yacht Club
The podcast highlights an aspect of the crypto boom known as the Board Ape Yacht Club, where cartoon images of monkeys were sold as NFTs for substantial amounts of money. Celebrities, including Jimmy Fallon, joined the trend by changing their names on social media and displaying these monkey images. The author, also caught up in the frenzy, purchased a less expensive derivative called a mutant ape named Dr. Scum. They attended a week-long party headlined by Snoop and Eminem, but the experience exposed the questionable nature of the crypto world. The author eventually sold Dr. Scum at a loss, reflecting the ephemeral and often irrational nature of the crypto market.
Bloomberg News Financial Investigations Reporter Zeke Faux discusses his book Number Go Up: Inside Crypto's Wild Rise and Staggering Fall. Hosts: Tim Stenovec and Jess Menton. Producer: Paul Brennan.