“I see dead banks, they walk around just like everybody else. They don’t even know they’re dead.”

It may seem spooky, but quite a lot of American banks are going under.

It’s nothing short of a crisis, so today we thought we’d take the time to tally up the dead.

Take a moonlit stroll with us through the rusted iron gates of the American Bank Graveyard!

Espresso Shots

☕️ Huge Gains for BRC-20 Tokens 📈 🪙

BRC-20 Tokens or “Bitcoin Request for Comment” tokens are surging, their market cap is at $137 million this week, a 682% rise from $17.5 million the previous week.

BRC-20 tokens were created to help facilitate token transfers on the Bitcoin blockchain.

One might immediately draw comparisons between the BRC-20 tokens and the ERC-20 tokens (Ethereum Request for Comment) as they perform similar functions, but BRC-20 can’t interact with smart contracts like ERC-20.

But that didn’t stop BRC-20 tokens from sextupling in value this week. Why? Because BRC-20 tokens allow investors to trade directly on the Bitcoin blockchain without having to go through an exchange.

Though it’s important to draw a distinction between the BRC-20 and the BIYE-20 tokens (Bitcoin Invites You to Edit).

☕️ Coinbase Lawsuits 🪙 📄

Coinbase is facing multiple, serious lawsuits alleging insider trading and violations of user’s data.

The first lawsuit, regarding insider trading, has been brought by Coinbase shareholder Adam Grabski through the Delaware courts.

This suit alleges that a group of high-ranking Coinbase execs, including CEO Brian Armstrong, created a plan to sell their shares before they would depreciate in value at the company’s IPO.

Is this tantamount to insider trading? Yes. And it looks pretty bad because Coinbase execs were communicating in an official, confidential project called, “Project Fall Fruits.”

The second suit, brought by Michael Massel through the District Court of California, alleges that Coinbase violated the Illinois’ Biometric Information Privacy Act in their use of customers’ bio-data such as fingerprints and facial scans.

The lawyers attached to the lawsuits have prepared themselves for court by chanting, “All your Coinbase are belong to us.”

☕️ Samsung Bans Chat AI for Employees 🤖 ❌

Samsung has banned its own employees from using ChatGPT or similar AI tools after an employee accidentally uploaded a “sensitive code” to the AI platform.

Though Samsung has insisted that this is a temporary ban while the company adjusts to AI, any employees who submit company information to AI, whether that’s at work or on a personal device, would face, “disciplinary action up to and including termination of employment.”

But it would seem that Samsung’s worries about AI were echoed by the bulk of its employees.

In an internal survey regarding the potential risks of AI, 65% of Samsung employees felt that it posed a security risk.

In general, Samsung employees were unperturbed by the ban, as Samsung users have had years to get used to being banned from group chats.

Spilling the Beans

America's Bank Graveyard 🏦 🪦

First Republic Bank collapsed on Monday.

The Federal Deposit Insurance Corporation (FDIC) quickly swept in, which is exactly what they’re supposed to do in these situations, and swiftly chartered a deal to sell the still-smoking husk of First Republic to JPMorgan Chase.

The failure of First Republic will be the second largest American Bank to go under with $230 billion in assets.

The largest American bank failure was Washington Mutual, which rang in the 2008 financial crisis.

Washington Mutual had $307 billion in assets and $188 billion in deposits.

But back to today.

The failure of First Republic Bank is hardly an isolated incident. In fact, the three largest bank failures after Washington Mutual have occurred in just the past two months.

It wouldn’t be an exaggeration to say that this country is in the midst of a banking crisis.

In addition to First Republic Bank, Signature Bank in New York and Silicon Valley Bank also went belly-up. Not to mention the demise of crypto-friendly bank, Silvergate.

If these banks were being murdered, we wouldn’t think this was a coincidence anymore. We see a pattern. A bank killer is on the loose.

But who’s to blame for the failure of these banks? Is it that the dollar is only growing weaker in the midst of a recession and global inflation?

Or is it much more simple than that?

The real killer behind America’s bank failure is a crisis of confidence.

When citizens stop believing in their banks, they withdraw their funds. The more patrons withdraw their funds, the more people panic.

The end result is a phenomenon known as a bank run, and it’s been the natural enemy of banks for as long as there have been banks.

You need to read between the lines when Joe Biden assures the public that the U.S. financial system is “safe and sound.”

Or Representative Patrick McHenry, Chairman of the House Financial Services Committee, insists, “Americans should remain confident in the safety of their deposits at U.S. banks.”

Because if Americans lose confidence in their banks, the banks lose all their power.

Now, look, crypto’s biggest critics are going to say that crypto is a made-up industry, it’s too young, and all of this is nonsense.

But don’t you see? Everything is nonsense.

Money is just ascribed value. Banks are just man-made institutions that we choose to believe in and therefore give our confidence in the form of our money.

It’s not that centralized and decentralized finance are diametric foes or inherently incompatible.

It’s just the new way of doing things vs. the old.

And when people stop believing in old institutions, they crumble and fail.

We’re not telling you to pull all of your money out of the bank and put it all into crypto. We don’t do that, and neither should you.

The big takeaway from the current banking crisis is how flimsy the old system is.

They tell us that crypto is risky. And sometimes it is. But these are the growing pains as we look to a better, brighter future.

One that Signature Bank, Silicon Valley Bank, Silvergate, and now First Republic, definitely won’t be a part of.

Meme of the Day

Please tell me someone out there still gets this meme.

Crypto 101

ERC-20 Tokens: We took an espresso shot to discuss BRC-20, so now we’re going to take some time to cover the O.G.

ERC-20 or (Ethereum Request for Comment)-20 is a technical standard for creating tokens on the Ethereum blockchain, ensuring compatibility and interoperability across various applications.

ERC-20 Tokens can be used to represent different cryptocurrency, assets, rights, or ownerships, really anything that can be transferred. The widespread adoption of ERC-20 has made it an essential building block for many cryptocurrency projects and innovations.

The Last Sip

In addition to banning the use of ChatGPT, Samsung has also banned its employees from:

• Stealing TVs out of the corporate office.

• Selling trade secrets to North Korea.

• Using their Samsung phones to start fires, even in survival situations.

Stay Caffeinated,

Coffee & Crypto Team

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.