Original subtitles

[V.O.] A tributary

of the Tigris-Euphrates River system in modern-day Iraq.

Known in ancient times as Mesopotamia,

this is where one of the first human civilizations emerged

thousands of years ago.

It's also where one of the earliest versions of money was invented.

The story of money

is one of the oldest and most powerful stories ever told.

One that's still being written as we speak.

- But what is money?

In short, money is trust.

A shared belief of common value.

But trust is a fragile thing.

It can be shattered in an instant.

For example, this is not Mesopotamia.

It's West Texas, just a few hours from where I grew up.

This is a film about a thing called cryptocurrency.

It's pretty stupid.

- Did we get it? - Yeah.

Great.

[V.O.] To understand my journey into the wilds of cryptocurrency,

we have to go way back to my humble beginnings

when I was a budding young actor.

- All right, my next guest stars on the hit Fox series, The O.C.

Please welcome Ben McKenzie.

[V.O.] At the age of 24, my career started off with a bang

when I was cast as Ryan Atwood,

the brooding bad boy on The O.C.

- Who are you?

- Whoever you want me to be.

[V.O.] I was tough as nails and soft as butter,

a real teenage heartthrob.

- You are the It guy.

You're, like, all over the place

on the cover of TV Guide and YM,

or is it pronounced you y-m?

[V.O.] When it finished, I moved on to the gritty cop drama Southland.

- Southland is a terrific show.

But I'm curious, do you still get fans of the O.C.

that come up to you?

- You were a teen heartthrob on the O.C.

- We gotta talk about the O.C. a little bit.

- Okay.

[V.O.] Alright, so I was still sort of that guy from the O.C.

But then, everything changed when I joined the Batman universe.

- Many of us remember Ben McKenzie from the O.C.

- Good morning, guys. How are you?

- I just have to wait one second and say I loved you in the O.C.

- And looking back at the O.C., and then...

[V.O.] While the rest of the world was stuck in 2003, I was moving on.

Well, sort of.

Smashing bad guys was fucking awesome.

And I even met the love of my life on the show.

But still, I was itching for something new.

And then, right on cue,

COVID hit.

- You've got to be putting that disinfectant

on these groceries, making sure that you're scrubbing them.

[V.O.] Holed up without work or direction,

I went a little stir-crazy.

So when my buddy Dave asked to catch up via Zoom,

it was a welcome reprieve.

As fate would have it, it turned out to be just the thing I needed.

Why are you in your kid's bedroom?

- It's the only safe place, Ben.

It's the only place I can go.

[V.O.] Dave is a good friend from college.

He has also given me the worst financial advice of my life.

When I was in my 20s and flush with cash from TV,

Dave encouraged me to buy stock in an obscure medical technology company.

They were going to make a fortune, Dave told me.

He had been at a wedding, and some random guy assured him so.

I was young and dumb and excited by his excitement.

So, I put $10,000 into it.

In less than a year the stock tanked,

and I lost almost all my money.

So when Dave brought up Bitcoin,

my skepticism was high.

- You know what's taken off is Bitcoin.

Have you looked at that?

I don't even know what the fuck it is.

- I guess a digital currency.

A cryptocurrency.

- It's money. - It's money.

It's a cryptocurrency.

Stop saying fucking cryptocurrency.

I don't know what the fuck that means.

- What is this like? What is this, like, look?

What are you like--

- I don't know if you know this about me.

- Oh, enlighten me.

I was great at Economics.

- Have we vetted that, by the way? Do you actually have a degree?

Yes!

- Alright. Well, I mean, I don't know.

You're a pretty good actor. How do I know?

Whoa! Go back to that.

[V.O.] If Dave's prior advice had taught me anything,

it was that you should never invest

in something you don't understand.

Plus, I have a degree in economics.

Surely I can figure out this crypto stuff.

No problem.

- Bitcoin. It's a new form of electronic money.

You know how email

changed old fashioned mail forever?

- Yes. - Well, Bitcoin is changing money

forever.

- So that is essentially what a hard fork is,

but there is also something called a soft fork.

- No banks, no fees, no inflation.

These are the potential perks of this thing called Bitcoin.

- What is a blockchain system where you

have this kind of one virtual computer created by...

- Bitcoin is brilliant.

[V.O.] The Bitcoin gospel is that it will revolutionize the world.

- Electronic gold.

[V.O.] Because it is the answer to our broken financial system.

- Intricately thought out, cunning and multifaceted.

- If you love Freedom, buy Bitcoin.

Are you serious?

- Are you serious?

The Bitcoin story is really powerful,

because we all agree on its premise.

Our current system sucks.

Remember back in 2008 when the banks and mortgage lenders

got greedy and crashed the housing market?

After all was said and done, the banks got a slap on the wrist.

Some even got bailouts.

- Wall Street applauded the biggest government bailout ever.

- Up to $700 billion taxpayer dollars on the line

to purchase troubled assets that are clogging the financial system.

[V.O.] Meanwhile, everyday Americans received no bailout,

and far too many lost their homes.

People felt betrayed, and for good reason.

Their trust in the mainstream financial system

had been shattered.

- Corporate greed is everywhere.

- Wall Street got bailed out, and we all got sold out.

Let's tell the truth!

[V.O.] And it was out of this breakdown that Bitcoin was born.

Someone, or some people,

calling themselves Satoshi Nakamoto

created the code for Bitcoin.

There could only be 21 million Bitcoin ever made,

and no one had control over it.

- The Bitcoin phenomenon is

trying to take control of money away from the state

and return it to individuals.

- You have an option to trust code,

so we don't have to trust centralized intermediaries.

- And so when I specifically buy Bitcoin,

I'm using my own personal capital

to prop up and support

the emergence of something that

would rip apart the existing financial system.

And if it does, God bless it.

[V.O.] In theory,

Bitcoin sounded like a promising solution to the status quo.

But I had a few questions.

How could Bitcoin work as a currency

if its price was ping-ponging wildly up and down day to day?

- It's pretty incredible.

I mean, Friday, Bitcoin was trading at, what, almost $42,000,

and now we're down to about $31,000 and change right now,

why the tumults over the weekend?

[V.O.] And why did i feel like I was being herded into a quasi-cult?

- You have the saying that there's no free money,

there's no free lunch.

Well, in crypto, there's a lot of free lunch.

- Question ask yourself is which side of history do you want to be on?

- I mean, I'm eating free lunch here everyday.

[V.O.] Just because there's a finite amount of something

doesn't mean it's inherently valuable.

That's my econ degree talking.

But when i really boiled it down,

I just didn't trust it.

It had the feeling of a generational hallucination.

- Take all your money, buy Bitcoin.

Go mortgage your house and buy Bitcoin.

Nothing else matters.

And that's when I saw it.

The crypto commercial that would haunt my dreams.

- History is filled with "almosts."

With those who almost adventured, who almost achieved,

but ultimately,

for them it proved to be too much.

And in these moments of truth, these mere mortals,

they calm their minds

and steel their nerves

with four simple words,

Fortune favors the brave.

- I mean, what the fuck?

What the fuck does Matt Damon know about cryptocurrency?

Nothing!

Are you mad at him for this,

or because he's more famous than you are?

He might be taller, too.

He's not taller than me.

Alright, so it says he's 5 '10", but...

Mmm, not sure.

I also say I'm 5 '10".

[V.O.] It wasn't just Damon.

A bunch of other yahoos got in on the act.

- I'm all in. Are you?

- You know what?

- I'm in. - Oh, I'm in, bro.

[V.O.] Now, here's the thing.

Celebrities have always shilled products,

ever since there have been celebrities.

Even my wife has done it.

There's nothing wrong with that.

But this isn't a sandwich or skin cream.

This was a financial product.

- Crypto will really be the future.

[V.O.] If you aren't a licensed financial advisor,

you're not supposed to offer people financial advice.

It's literally illegal.

- It's the new wave. It's what everybody's doing.

[V.O.] As an actor, I'm a professional bullshitter.

- Eh, I don't think so.

[V.O.] And my gut told me,

the guys selling people on crypto were full of it.

- It's a cryptocurrency you can trade for conventional money.

- Oh, so it's a hustle.

- Yeah, it's a hustle.

- Why didn't you say that, man?

- To the moon!

[V.O.] Up against a multi-trillion dollar industry

shilled by every celebrity on the planet,

I did what any other actor would do in my position.

I hired a film crew.

- This is Giorgio, he's gonna be filming me.

Is he-- Is he gonna film?

He's gonna film, yeah. He's gonna make a movie.

You wanna be in a movie? - Yes.

- Ok. - Go!

What's this thing?

It's a lens.

I have my ball.

Ooh, that's a nice ball.

It feels like...

Strawberry.

Oh, it's a checker.

Whoa-ho-ho!

Yeah! Yeah!

I think they're coming downstairs.

Let's go say hi to Mama and Juju.

No.

Yeah, we're gonna go tell them that we're making a movie.

We're excited to watch a movie here.

This is Giorgio.

- Hello. - Hi.

Nice to meet you.

I'm sorry, what's going on?

We're just gonna film it.

Okay.

He'll be quiet, we promise.

Georgio is very nice.

Heads up, did you talk to my agent yet?

Alright Arthur, I'm putting cheese on your pasta, okay?

Do you want cheese on your pasta? Do you want to put it on?

Guys, Georgio is gonna be with us for like the next...

undetermined one to twelve months.

Is everyone clear on what I'm doing?

- Do you guys know what I'm doing? - Oh yeah!

I'm making... What? What am I doing?

You're trying to make fun of everybody that uses cryptocurrency.

Yeah, that's pretty much it.

So, I was sneaking Cheetos in class,

but then I got Cheeto-fingers and I rubbed my eyes,

and my eyes were burning hot all throughout class.

To me.

[V.O.] To develop a deeper understanding

of crypto's true believers,

I needed to observe them in the wild.

Fittingly enough, they were gathered in Miami.

- Tens of thousands of people are heading

to Miami this weekend for what's being called

the largest cryptocurrency conference in history.

I'm getting a nice shot at no balls, right?

[V.O.] The Bitcoin Conference in Miami

claimed to be the largest in the world.

50,000 people were expected to attend.

I wanted to see Bitcoin in action,

and this seemed like the perfect place to do it.

- Matt Damon?

Matt Damon?

Sorry, have you seen Matt Damon?

[V.O.] But first, this Austin boy wanted to have some fun.

- Don't worry, folks, I'm from Texas. I know what I'm doing.

Oh!

Oh!

Oh!

Oh!

Oh-oh!

Hey, we can edit that, right?

That's fine. It's fine.

Oh, Starry Night.

The original.

Ah, there we go. American beer.

And I can pay in Bitcoin?

Right now, sir, we're using only the credit card.

We used to have the Bitcoin, but it's not working at this time.

It's not working?

- Oh, is this your art? - Yes, sir.

Oh, hey, man. How are you?

Bitcoin fucking money.

Bitcoin shitting money.

Bitcoin fucking money.

Bitcoin shitting money. Okay, got it.

- Yeah, I'm really sorry for that. - That's alright. That's alright.

I think I can use regular real money.

- Yes. - Alright.

I'm starting my own coin. It's called BenCoin.

What if I paid you in BenCoin?

So I can cash it out.

There we go, right?

Yeah, yeah, I mean, you got to get in early with the future.

- Exactly. - Otherwise, it'll pass you by.

Does it ever feel like a little bit like a cult to you?

Just like flaming eyeball shit?

- It's like Game of Thrones shit. - It's like Game of Thrones shit!

I tried to buy my beer in Bitcoin, and it didn't really work.

- That's true. - No, it didn't over there.

They were having some problem.

- Gotcha. Gotcha, - Does it take time?

Like 20 minutes.

- To go- to process a transaction? - Yeah.

[V.O.] I was having a hard time seeing the advantages of Bitcoin.

But then I met an unlikely fan.

His name was Alex,

and he worked for the Human Rights Foundation.

There's like tens of millions of people

in emerging market countries that use this thing,

because it's the best option they have.

Money, finance, economics,

was hardly ever a part of the human rights discourse.

But when you actually ask

human rights activists from different countries about money,

they always have crazy stories.

Demonetization, devaluation, hyperinflation, frozen bank accounts.

So this is a way for them to break free.

All these people are getting into this thing because the numbers go up,

it's like this Trojan horse, but in reality, like inside,

is freedom go up.

[V.O.] Alex made a compelling point.

Maybe Bitcoin could be a tool for good.

But then I thought about its wildly fluctuating price.

What if all these people in developing countries

bought in and Bitcoin's price...

crashed?

Bitcoin's what, $44,000?

Wasn't it $48,000 like yesterday?

Was that the day before? How much was it?

Well, five years ago, it was... it was...

But like yesterday, it was $47,000 and now it's forty--

What is it today? $43,000?

I don't know. I think it's $44,000.

The important thing is...

Uh...

Two years ago, it was $4,000.

So, the important thing to remember is that over time this thing gets--

- $43,000 today. - Right.

So in 2020, in April, it was $4,000.

So, the important thing is that-- it over time-- it gets more valuable.

[V.O.] It just didn't make sense to me.

But Alex assured me the argument was bigger than price.

This is about separation of money and state.

It's making a huge difference around the world.

I think every country should have Bitcoin as legal tender

to transact, earn income, pay taxes, whatever.

[V.O.] Could the crypto utopia that Alex described

exist in real life?

After some intense research, I found an answer.

- El Salvador.

This look represents El Salvador's history of currency.

For a long time, coco was used, and then the cologne,

until it was replaced by the U.S. dollar.

In 2021, El Salvador became the first country in the world.

to use bitcoin as legal tender.

You don't need a dash to walk around dressed in cash like El Salvador.

If I bought that for you, would you wear it?

So, why do you need to go there?

Because... they're trying to use Bitcoin as money.

Well, is it safe?

It's totally safe. Hold on a second.

It says it has one of the highest murder rates in the world.

No, it used to have the highest murder rate in the world.

Now...

now it has the highest incarceration rate.

So it's totally safe,

plus, you know, I speak excellent Spanish.

[Spanish] This gringo is going to get fucking killed.

Oh, my God.

[Spanish] This gringo is going to get fuck...

Why am I laughing?

- Glad you think it's funny. - Oh my god!

- Gangs turned El Salvador's murder rate

into one of the highest in the world.

- Some 75,000 people have been arrested.

- People can also face 15 years in prison,

and this applies to journalists, too.

[Spanish] Thank you for flying with Avianca, the sky belongs to everyone.

You're saying hello to El Salvador another time, we promise.

- They seem to be giving Ben a hard time.

- This dude just called for his supervisor.

Oh.

They just want his picture.

God bless the OC.

What's up, dude?

Shit, I'm good. I'm good. I'm good.

Ah, guess where I am?

- Um, something tells me you're not in Wisconsin.

I'm not in Wisconsin. I'm in El Salvador.

Can you guess why?

- What the hell? Yes, why? I want to hear you say it.

Bitcoin, baby, Bitcoin.

Dude, you can't make this shit up.

- What are you doing?

What are you doing with your life?

I don't know.

It's the honest to God answer.

[V.O.] In 2019,

a former advertising executive named

Nayib Bukele shocked the political establishment

when he was elected president of El Salvador.

The crypto bro Prez changed his Twitter handle to

The Coolest Dictator in The World

and bragged about casually buying Bitcoin

using the state treasury

while sitting on the toilet.

Bukele sold a bold vision of the country,

as a revolutionary Bitcoin Switzerland

that would attract worldwide attention.

- Mr. President, thanks for joining us.

- Thank you, Tucker, for inviting me.

- We're not condoning every single thing

the El Salvadoran government has ever done.

I just think that them adopting Bitcoin is one of the best things

that you could possibly do for the nation.

[V.O.] I wanted to see how much Bitcoin

had changed life in El Salvador.

It was time to go shopping.

[Spanish] Do you take Bitcoin?

[Spanish] Bitcoin? Do you take it? No. No.

[Spanish] Do you take Bitcoins?

- [Spanish] No. - [Spanish] Bitcoin? No.

[Spanish] Do you take Bitcoin?

[Spanish] Bitcoin? No.

Ah, Ok. I thought for a second... Ok.

[Spanish] Do you take Bitcoin?

- [Spanish] No. - [Spanish] No Bitcoin.

[Spanish] Do you take Bitcoin?

[Spanish] Do you take Bitcoin?

[Spanish] No.

[V.O.] The marketplace was a bust,

but there was another prong in Bukele's Bitcoin revolution.

He claimed Bitcoin would save his citizens millions in remittance fees

when sending or receiving money from overseas.

It was a common argument for pro-Bitcoiners.

- I think what a lot of people don't understand in the United States

is that a lot of people live in countries and work in countries

and they have to send money home.

A lot of it's cross-border, and that transaction fee in and of itself,

transferring money, can run you 10%.

[V.O.] Nice idea, but reality painted a different picture.

According to the government's own figures,

just 1.6% of remittances were paid using Bitcoin.

But Bukele, ever the salesman, refused to concede defeat.

Instead,

he went bigger.

- So we were thinking of building...

Bitcoin City.

[V.O.] In November 2021, Bukele announced

what he called Bitcoin City,

a tax-free paradise for coiners in eastern El Salvador.

The showpiece city would be built in the shadows of Conchagua Volcano.

- This is a fully, fully ecological city and it's energized

by a volcano.

[V.O.] Bukele loved the volcano.

- The volcano.

[V.O.] Since I was already in the country, I figured, what the hell,

might as well check it out.

We drove more than 100 miles to La Union,

on the eastern edge of the country.

What we found was a sleepy fishing village,

and almost no evidence of any actual development

of this supposed City of Gold.

We did, however, meet a guy named Corbin.

- This is the perfect location for that dream and vision,

and this is where I want to be for that reason of

being the first resident citizen of Bitcoin City.

I'm an industrial designer.

I've had hundreds of jobs and a few careers in there.

In all that time, I'm asking the question of what is money?

Where is it coming from? Who's in control of it?

Bitcoin isn't just a vehicle for me to make money.

It's freedom.

One man,

casa cita,

or chiquita citadel.

Chiquita Citadel, uh, built it out of cinder block,

poured a concrete slab myself, and built it on it.

All myself.

But this is just the earliest first stage, like I build up from here,

as Bitcoin goes up, my casa goes up.

Outside over here is my bathroom.

At first I was met with, like, uh,

like, disbelief, like, wait, why would you,

an American gringo, want to come and live here?

I don't know how to explain, you know,

well, things are going to change here,

there's going to be a Bitcoin city over there,

a new airport, mucho turismo.

I want to be here, because I like it as is

and I like the potential of what's coming.

[V.O.] There was only one problem

with this grand vision of Bitcoin City.

The people who were living there were in the way.

Wilfredo Claros is a fisherman by trade.

He and his family have lived in La Union for generations,

but now the community is being threatened with displacement

so that the airport to service Bitcoin City

can be built on their land.

In exchange for leaving,

the government has offered Wilfredo

a fraction of what his property is worth.

He has been told the offer is take it or leave it.

So you don't use Bitcoin?

Your sister is...

[V.O.] It was clear to me that Bukele's sales pitch

of a Bitcoin-embracing nation was full of holes.

It felt like a pumped-up marketing scheme

with little substance behind it.

Was it designed to put El Salvador on the map?

Or just Bukele?

- Never before I could have done something that would impact

10 million lives.

Why would I do this if it wasn't for the legacy to change this country?

Got a visitor.

Hi. Good morning.

Good morning.

[V.O.] After leaving El Salvador,

I made my way to London where Moreno was shooting a new film.

The whole family had come along for the ride

and my crypto journey was put on hold.

To be honest, I was fine with it.

I needed a break from Bitcoin sleuthing.

It was time to get back to something real.

Showbiz.

Hello.

Hi.

Is it alright if I come in?

So, how does it work?

Alright. Yeah, I'm gonna hit you.

This whole Hollywood thing.

Is this nice? Is this yours?

Like, is this the one that you go to?

Yes, this is mine.

Jerry is next door.

Jerry Poppers.

- Yeah. - The Jerry Poppers.

Yes.

- This is Sparta!

Don't annoy him.

Don't talk to him about crypto.

What do you think Jerry Butler thinks about cryptocurrency?

I haven't asked.

I made a ton of money on it. Yeah, yeah.

- Oh, really? - I've done really well.

Really, really, really well. Out of it, yeah.

- Wow. - So far, yeah.

But I don't actually know anything about it.

Well, it doesn't matter, right?

- So, what... How you doing? - Yeah, I'm alright.

It's great to tell you what I'm doing these days.

- A little bit. - Yeah, yeah.

- And I'm doing like a documentary... - Oh, yeah.

- ...you know, trying to get the word out.

I mean, it's hard because it's so successful

and so many people made so much money on it.

So, it's kind of hard to get that story out because...

Hey, are you still-- Are you still acting?

- Yeah. - Yeah?

No, I did a pilot.

Oh, nice.

I didn't go.

No.

- Docter. - Yeah.

Anyway, listen, I...

- ...I gotta go. - No, no, I understand. Thank you.

No, no, nice to see you, Ben.

[V.O.] Maybe Gerard Butler was right.

As long as everyone was getting rich on this Bitcoin stuff,

why bother to understand how it actually works.

Uh, uh...

Yeah.

It makes me feel old.

What's your name?

Scott?

Scott Ben.

Nice to meet you, man.

Ah, this, I'm filming a documentary.

Yeah.

It's about cryptocurrency.

It's the future of money.

We just need the real stuff right now.

[V.O.] Gerard Butler was honest.

He had just gotten lucky with Bitcoin.

But I had to believe there were more Scott the Scaffolders out there.

Regular people trying to make an extra buck and getting scammed.

I had to keep going.

But where to begin?

It felt like crypto was everywhere,

the virus spreading in infinite directions.

- There are now over 1,500 cryptocurrencies.

- There's PP coin, there's BBQ coin,

there's Litecoin, there's Feathercoin,

Primecoin is a very interesting one.

- We can just make as many tokens as your heart desires.

[V.O.] There were so many promising crypto coins out there,

with names like Internet Computer,

Bonk, and Cum Rocket.

In the crypto community, they were known as shit coins.

And with the frenzy in full effect,

trying to figure out where to go next was daunting.

- Very interesting what's happening with Doge.

We do know that Elon Musk if a huge proponent of Doge Coin.

And since that it could become the world's leading currency.

- And we need someone to help us with our financial life.

and normally we just people that--

- we think are acting in our best interest.

But what if these people are not acting in our best interest?

What if their interest is exactly the opposite of ours?

Should we continue giving them our money--

- or should we take the money and put it somewhere else?

Celsius Network, we decided to create a replacement for the banking system.

We have 1.2 million customers,

and we're adding about 100,000 a month.

We've paid a billion dollars back to the community in interest.

That's probably more than some of the largest banks in the world.

It just shows you how banks are not your friends.

But Alex is your friend?

- Yes.

[V.O.] Celsius sought to upend the banking system,

led by its founder, Alex Mashinsky.

Rather than keep the profits for themselves, like most banks,

Alex wanted to give that money back to the users.

But this new model for a bank had a fatal flaw.

Celsius was not a bank.

It even said so on its website.

You know, in the very small print at the bottom of the page.

Not shady at all.

If something happened to Celsius, your money might be gone forever.

A real licensed U.S. bank is just the opposite.

If the bank goes under,

our government steps in to cover the loss.

The system works because people trust it,

and they trust it because it works.

Moshensky claimed to have built a better bank,

but I suspected he had created something far more dangerous.

It was time to take my film crew to meet Alex Moshensky.

- As luck would have it, he happened to be in my hometown.

The clothing brand Poopy and Pooper?

That guy's definitely into groups like that.

[V.O.] South By featured the bleeding edge of technology.

Things like virtual reality,

pickleball,

- I got you, baby.

[V.O.] and the CIA.

- What you're going to do is press and hold that A button.

Or B button, sorry.

- Hold this button? - Yeah, uh, yes.

Whoa.

I don't know if you guys are aware, the CIA has a podcast.

The CIA podcast?

Yeah, we do. You should check it out.

[V.O.] As I made my way to the Celsius booth,

I decided I would play the role of a gullible actor

stumbling onto crypto.

Should be easy enough.

- Like, where have I seen you?

Yeah, yeah, yeah. I was on the OC,

and then I did a show called Southland,

which was a late cop show.

Um, what are you guys doing here?

We're crypto. We're, uh, Celsius.

Oh, right, right, right.

That's us.

- That's you guys? - Yeah.

That's our... That's the logo.

- Oh. - Alex is the CEO,

CTO.

Oh, my God.

You're in the right place.

Yeah. So what does it do?

What does Celsius do?

We-- we basically do the opposite of what banks do.

Anything a bank does, we do the opposite.

- Okay. - Okay?

They charge you fee, we don't charge you fees.

- How do you make money, then? - We pay you interest.

Oh, okay. How do you make money, then?

Banks make a lot of money. They don't want to give it to you.

They give it to their shareholders.

Uh-huh, uh-huh.

We treat it like a community.

So we take all the profits and give it to our community.

It's like a community bank.

[V.O.] Except it's not a bank.

- So has Celsius experienced any legal trouble?

We don't-- I don't know what you mean by legal trouble.

Well, legal proceedings. Has anybody, like, sued you guys?

Have you had any fines or anything?

But there's no financial institution

that is not getting inspected by all these agencies.

- Every day. - I'm not hearing a no. I'm hearing,

uh, I'm just asking, I'm just asking you an honest question.

The answer is no.

- The answer is no. - Oh, oh.

The answer is no.

[V.O.] The answer was, in fact, yes.

Celsius was facing legal action in multiple states, New Jersey, Alabama,

and even Texas.

- So what do you say to the people who have been scammed in crypto,

obviously to half the people, like we can all acknowledge that.

So what do you say to those, like, what's the solution to that?

- How do we fix that? - The guy on Twitter asked me, what?

Alex, how come all the scammers are coming to crypto?

I'm like, you left the door open, you left the window open.

Of course they're going to come and steal from you.

So it's maybe sort of their fault.

- Like they sort of... - It's not, it's not just that.

If you left money on the street,

do you expect it to be there in the morning?

It's not just that. I think a lot of this has to do with easy money

and fraud. They go hand in hand,

because as soon as you, as soon as you say like,

- I want to park my currency with you - Yeah.

[V.O] Toward the end of our conversation,

with the video off, but the audio still rolling.

I asked him how much real money he thought was in the crypto system.

- Say maybe 10 or 15 percent is real money that went into the system.

And everything else is just bubble.

[V.O.] It was a jaw-droppingly low number,

and mildly concerning as the crypto market had been booming for years.

- Cryptocurrency is going mainstream

with a total market cap of nearly three trillion dollars.

- Mastercard says now any bank or merchant on

its network will soon be able to offer crypto services.

- Bitcoin investors feelin' good as hell today!

The crypto coin reaching an all-time high of 68,000.

- We do see Bitcoin going up and up and up. It's amazing. It's amazing.

Where is it going?

It's probably going to 100, then 150, then 200,000.

[V.O.] It made zero sense.

Maybe it was time to meet my mysterious friend.

Hey, this is Dave. I can't come to the phone right now.

But leave your name and number

and I'll get back to you as soon as I can. Thanks.

Dave, it's your boy.

I'm down in Florida meeting with some random guy

I met from the internet who says all of cryptocurrency is a scam.

If I don't come back alive,

I love you.

Really nice to meet you.

- Yeah. - Thank you for doing this.

Yeah. No problem.

Okay, so let's start with how you got started.

how did you fall into this crypto rabbit hole?

My background is I used to do video game hacking and reverse engineering.

I was basically printing my own money from video games.

So you started off as someone, a professional cheater?

Yeah, I was basically, yeah, I was cheating in video games, yes.

Inevitably, I got caught, and I got banned for 30 years.

But what I learned is that it's the same bullshit, you know, as crypto.

Right.

You've been exposing crypto fraud since 2016?

I would say, when I first started, it's going to be March of 2017.

I had some suspicions early,

and once I started digging a little bit deeper,

I'm like, okay, this is bad. This is fraud.

Why do you think that is?

I personally believe

the entire market is really controlled by fewer than 20 people.

You know, and they can make the price go to whatever they want.

How?

Let's say you have two accounts, and you want the price to go up.

So all you do is trade between your two accounts

and you can basically just walk the price up.

So they control both sides of the trade?

Right and then someone else

that's on the outside doesn't realize and they see the prices going up.

It's got up 15 % in the past 15 minutes,

you know, and they go ahead and they buy it.

Those are the suckers basically coming in

not realizing that it was just one guy

with two accounts making the price go up

- Right - Between 90 and 95%

of all the cripple trading

That's all it is

Now the other 5% is only in there

because they think that the other 90 to 95% is real

which it's not.

[V.O.] So now the people pumping up the price can sell their tokens.

And everybody else gets screwed.

- Yes, that's it.

So if 90 to 95% of the trading is fake,

does that mean the social media activity is that also fake or?

It's paid for. A lot of it is paid for.

A lot of it are actually bots that just spam Twitter,

you know, 24/7.

But the thing is, a lot of these crypto influencers

are actually paid by the scammers themselves.

What are they paid in?

Dollars.

Not crypto.

But basically everybody inside of crypto

is winning except for the regular people that put their money on it.

Yeah, the regular people that don't realize that it's all a facade.

Right. They're the ones holding the bag.

Yeah.

[V.O.] Celsius had a coin called Cell.

Its price had exploded, growing by a factor of 10 in less than a year.

If Bitfinext was right,

then once the insiders took their money off the table,

a crash was inevitable.

- Crypto obviously right now getting crushed.

- Tonight, a massive sell-off of cryptocurrency.

The price of Bitcoin plunging to its lowest level in 16 months.

The numbers sending some investors spiraling,

fearing they could lose it all.

[V.O.] The market's collapse was shockingly swift.

And rumors were circulating about Celsius going under.

- You don't need to find something better

because there isn't anything better. We allow people to

withdraw hundreds of millions of dollars every week.

Anyone who wants to withdraw has no problem.

- So breaking news, the cryptocurrency platform Celsius,

they are stopping withdrawals.

- CEO Alex Mashinsky now saying in a statement,

this is the right decision for our community and company.

This whole idea of banks are evil and then becoming a worse bank

is kind of the headline story with Celsius.

[V.O.] And the price pumping tricks that Bitfinex laid out were spot on.

- You're saying

that management was manipulating the price of the Celsius token.

- They were absolutely trading the token to manipulate the price.

[V.O.] As more details emerged,

it was clear that Celsius was never profitable.

It merely took money from the new customers to pay the old ones.

Maszynski and his crew reportedly withdrew millions

before filing for bankruptcy.

To make matters worse,

Maszynski's wife started selling a new take

on the classic Celsius t-shirt.

It read, Unbankrupt Yourself.

The people who were scammed were pissed.

I set up a few Zoom calls.

Uh. How are you?

- Can you hear me? - You cut out.

- I cut out. Just-- - I can hear you.

We're out in the desert.

Would you mind tilting your camera up just a little bit.

I'm having trouble seeing your face.

Ah, I can hear you.

Here we go. I think it was connected to my X-Box for some reason.

Did you say you were in Texas?

Yeah, yeah. I'm in Fort Worth.

Oh, cool. I grew up in Austin.

Yeah, I love Austin, man.

I like your shirt. What does it say? In Crypto...

Oh. In Crypto We Trust.

Nice. In Crypto We Trust.

Yeah, just not so much Alex Mashinsky.

What initially attracted you to it?

You said your friends...

were investing in Celsius or encouraging you to invest.

Do you remember why you first invested?

I mean the idea wasn't just to like get rich and get big.

I think I just wanted to have good investments for my future

and be able to build.

- So I was just trying to get myself set up for retirement.

- I saw Celsius as an opportunity to make a lot of interest.

- Maybe even find a way to where I'm not having to work

as many hours a week or something

just so I could spend more time with my daughter.

- My M.O. is I just want to do something that's simple

and this seems like an easy way to sort of like

have, you know, get passive income.

- I thought that I was going to get to a point

where I would be able to live off the interest, you know,

and none of it was ever even there.

Do you remember when you heard Celsius collapse?

I was crying, my wife was upset, my kid was too young to know

what's going on, but we lost a lot of money that day.

- The amount that he hosed everybody is just, sheesh.

Yeah, but whenever all of that had happened,

nobody knew what was going on.

And the way that Celsius was being painted to us was that,

you know, it was safer than a bank.

- How could this possibly be an obvious scam, given that, you know,

there's all these people behind it?

- I thought there was no risk with Celcius,

because they said they were keeping our funds safe.

- You know, we're U.S.-approved, we're SEC-whatever-approved.

- Trust us. We, you know, have risk mitigation in place.

Everything is fine.

- It gave the impression of security.

- I just never crossed paths with such a criminal, you know.

Just a criminal. Through and through.

- I will take the hit. If I ever meet that dude I will pull my pants down.

With Alex, the difference between what he was saying

and what he was actually doing

is just is vast.

It was Bernie Madoff level, you know, fraud.

- When you meet him in person,

he just gave off Carnival Barker vibes to me.

- I wonder if you were able to see a side of him in person

that I wasn't seeing on the videos.

- Given that Mashinsky was running this fraud,

do you think that the Celsius community was a real thing?

- No. No, never.

- For me personally, Celsius doesn't really have a community.

It's just got a very long list of victims.

I have a question for you.

Have you seen the creditor list?

Not in any great detail. Why?

Let me see if I can share my screen for this.

So, this is the list of people that are owed money by Celsius.

And if you just, I don't know, go into A, for example,

- It just goes on and on and on. - Oh my god.

- I'm on page 588,

so I think the 1,388 pages

are just the people with names starting with A.

The number of people who put money into Celsius is astronomical.

It's huge.

- One question we're asking everyone is,

how did losing the money affect you, if at all?

I mean, it seems silly,

but I was more focused on just like the embarrassment

then the actual financial implications.

Yeah, I just kind of remember thinking,

well, this is going to push my retirement back a few years.

- It was mostly, mostly just a shot at freedom, you know,

a shot at a little bit more claiming of my time back and that

time I can't get with my daughter back.

I just had so many plans, you know.

- I'm sorry.

- I feel like I let it down big time.

- Yeah.

I'm sorry, man.

- Nah. No. It's okay.

- I'm totally at peace with it, you know.

- It just sucks that that one thing had to kick my plan in the shin.

- Yeah, yeah.

Life has a way of doing that, doesn't it, sometimes?

- Yeah.

[V.O.] The false story of Celsius was predicated

on a fundamental truth that our system is flawed.

But Celsius didn't offer a better solution,

merely a way to tap into people's anger

and funnel their money into a Ponzi scheme.

Our current financial system is far from perfect,

but at the very least it's built on centuries of trust,

because the economy is something we all contribute to.

So in the end, for our economy to work,

we are essentially trusting ourselves,

and each other.

- Lying for Money:

How Legendary Frauds Reveal the Workings of the World.

Written and read by me, Dan Davis.

From the beginnings of modern capitalism,

there have been people engaged in the business of stealing by lying.

Seeing the forest for the trees is a difficult thing to do,

because there will always be trust,

and therefore, there will always be scams.

[V.O.] After Celsius blew up, dozens of other companies also went down.

It was dubbed the Crypto Winter.

The industry appeared on the verge of collapse.

Only one man could save it.

- The crypto world is now going to get a bailout,

and it's coming from one of their own.

- Sam Bankman-Fried is really becoming

the industry's lifeline during a crisis lately.

- The CEO of FTX is behind hundreds of millions of dollars

in emergency loans.

[V.O.] He was everywhere.

- Joining me now is Sam Bankman-Fried.

- He's the 29-year-old gazillionaire,

FTX founder and CEO, Sam--

- Bankman-Fried, amassing an astonishing $22.5 billion fortune.

- I mean, it is, to me, amazing that, like, three years ago,

nobody knew who you were, and now your business is, like,

one of the fastest-growing businesses in the history of the planet.

[V.O.] Sam was the unlikeliest of billionaires.

Tussled hair, T-shirt, and cargo shorts.

He made his billions trading crypto.

But Sam's motivation was a complete 180 from someone like Mashinsky.

Sam was a proponent of a philosophical craze

sweeping through Silicon Valley called Effective Altruism.

Conceptually EA is straightforward.

If you want to do the most good for the most people,

you should strive to make the most money possible

in order to give it all away.

- I wanted to get rich not because I like money,

but because I wanted to give that money to charity.

[V.O.] And Sam saw crypto as the vehicle to make that happen.

So keeping the industry afloat was key.

- A high-profile crypto failure would be devastating,

could also spark retail investors to leave the industry altogether,

which FTX really relies on.

[V.O.] FDX was Sam's crypto exchange,

where you could buy all sorts of cryptocurrencies.

- When we think about, you know, where crypto is today,

it still is touching a pretty small fraction of the world.

And so I think a lot of what we've been thinking is like,

what are ways that we can take what

we see as an exciting, growing set of products and industry,

and sort of introduce them to tens of millions of people.

[V.O.] He did this by using his ballooning wealth

to pay for sponsorships and celebrity endorsements.

- FTX is the safest and easiest way to buy and sell crypto.

- It's the best way to get in the game.

- With FTX, I have everything I need

to buy, sell, and trade crypto safely.

[V.O.] He even signed deals

with paid spokespeople in the financial industry,

like Kevin O'Leary, who had been a fellow crypto critic.

- I'm not going to take real money and put it into this thing.

It's never going to happen. It's such a scam.

[V.O.] This was before he signed a $10 million deal with FTX.

- I am a paid spokesperson for FTX.

I did a lot of due diligence before I accepted that position.

[V.O.] Sam wanted to make crypto easier, friendlier, and safer.

And he knew that in order to do that, you need to build trust.

- Mr. Bankman-Fried, you are now recognized

for five minutes to present your oral testimony.

- Thank you, Chair Waters, Ranking Member McHenry.

It's an honor to be here.

I think that the industry has the potential

to improve a lot of people's lives. And I think it is important

and I think that it's healthy that the industry will be regulated.

- Crypto executives poured more than $30 million

into political campaigns since the 2020 election cycle.

- There is a new and exciting industry

in the United States of cryptocurrency,

whether Bitcoin or otherwise.

- I buy Bitcoin and I hold Bitcoin.

- You buy Bitcoin? - Oh yeah.

- You have Bitcoin? - I do.

[V.O.] Sam was playing the Washington game to perfection

and buying the trust he needed

to take crypto even further into the mainstream.

- What does this technology FTX uses

to protect from fraud and manipulation look like?

- We have surveillance for unusual trading activity.

We have manual inspections of anything that you know gets flagged

either by the automated surveillance or by manual inspection.

- Sounds like you're doing a lot to, uh, make sure there is no fraud

or other manipulation.

I thank you, Mr. Bankman-Fried.

[V.O.] I had to talk to him.

So I did the only thing I knew how to do.

I DM'd him on Twitter.

It was a long shot.

Look at this.

Finally freeing up a bit. Had a crazy week.

Just got back from testifying in D.C.

I'm *** at FTX .com if you want to reach out there.

♪ agreed.

It's Limoncello.

What is Limoncello, actually?

It's like the, you know, the Italian liqueur.

There's alcohol in it.

But they flavored it that way. I don't know.

It's actually kind of interesting.

- Don't mind it. - Yeah, okay.

It was the only one I had at the house.

- I was like, mm, we'll try it. - No, it works.

All right, you guys ready?

- You're good. - All right.

Sam Bankman-Fried.

Thank you for taking the time to speak with me.

Of course.

So, I had a conversation with Alex Mashinsky.

From Celsius.

- Yeah. - Yep.

I asked him how much real money is in crypto and he said

and he said 10% to 15%.

He said the rest is speculation.

Thanks. So as of today I think the number

of dollars in crypto have not changed massively between then and now.

One when perhaps they've lessened.

They certainly have not increased.

I don't think they've decreased massively though which

I think lines up with some of your thought that

like a lot of this was leveraged leaving the system.

Well, part of the problem if they haven't left is

that people can't get their money out.

Imagine this is a regulated bank. - Oh, yeah.

- This would be a big problem. - That would be a big problem.

This does not seem like the decentralized,

democratized future of money that we were promised.

I think we've seen all the major carnage

in the crypto industry already.

I think that things are on a bit of a recovery path from here.

But to be honest, Sam,

it doesn't feel like it's creating a lot of good for people.

It feels like it's a net negative.

- Yeah, I think I disagree-- - Why?

- but I understand where you're coming from.

I think the bigger piece of this,

and probably the thing that is ultimately driving your belief,

is around ultimate use case.

Give me one use case. Give me one company that's

providing a good or a service utility.

First of all, it's just payments.

And I know this is a thing that gets talked about a lot,

but I do think that there is real

potential there to make payments a lot cleaner.

Remittances are, you know, really, really expensive.

Well, I just want to, sorry, I just want to be really quick,

because we went to El Salvador. - Yep.

- It's not being used.

It's less than 2%. - Yep.

- So how does that work as payments or as remittances?

It's not working.

I agree it's not working today.

I think it could get there in the next five years.

Inshallah.

But, you know, I think it's not there today.

I think there are real reasons it's not there today.

But people are buying it as an investment.

They think it's going to make them money.

Isn't that what you're seeing? I mean, you run a big exchange.

You have a big trading firm. Isn't that what people are doing?

Are they doing it to pay for things, or are they using it to gamble?

The majority of people today are not using it as a payment field.

The majority of people today are using it just as a financial asset.

But my belief is that over the next five to 10 years,

we are going to see

blockchain grow in a few different use cases and start

to provide more and more actual utility to people.

If I didn't think that was true,

that would significantly change my belief

about the crypto ecosystem overall.

Your belief system seems to be driven somewhat

by the fact that you've made so much money.

You want to do the most good for the most people.

But when I look at the crypto industry,

it feels like it's driven by getting retail customers, regular people,

into the crypto casinos to gamble.

Some of them make money. Most of them don't.

What do you say to the people that have lost money?

Millions of people have lost money now.

Some of them can't' access their money.

Like, what do you say to those people?

So, I mean, that was really bad.

I'm, you know, like, it sucks.

Maybe one question you can ask is,

is the system set up today such that

the regular person can get enough information

and transparency and comfort?

And I think that, like, the answer is basically no.

There needs to be more oversight.

There needs to be more transparency.

Speaking of regulation,

I think something like $30 million has been spent over the last

six months or a year towards influencing regulators

and politicians.

I think that this is a very dangerous thing that we're playing with here.

So most of what I'm doing for crypto regulation is not contributions.

It's going and talking to people in D.C.

and having meetings, trying to explain as much as I can,

trying to point out the parts that I think most need oversight.

When you look at the contributions that I've made,

most of those have to do with pandemic preparedness.

Totally unrelated to my day job.

How much money have you donated to things like that?

I want to say ballpark, um, 50 to a 100 million.

Wow.

- 50 to a 100 million to pandemic. - Yeah, that's right.

- How much have you donated to politicians?

So, I...

I...

um...

I don't remember, I can get back to you on that,

I don't remember the latest figure off the top of my head.

I'll just give you like a round number.

Ballpark.

I think...

um...

I think that... you know,

in the tens of millions is--

is where total political contributions have been so far.

- Sam, you really need to. - Okay, got it, yeah.

- Thanks for taking the time. - Thank you.

- Appreciate it. Can we do a picture?

- Is that possible? - Yeah, let me just check where...

- Oh, sure, sure, sure. - Yes, but I have to do it quickly.

No, no, that's fine. We don't need to do anything.

Let's see, where is it?

Yep.

Ah, there you go.

Alright, um...

Awesome, thank you, sorry.

- The nature of fraud is that it's a magic trick.

It's the creation of facades that look utterly convincing,

but only when viewed from the right angle.

The fraudster needs to know where the audience is going to be looking

to make sure the nefarious action is taking place somewhere else.

You wrote a book on fraud.

Yeah.

- I'm not crazy, am I? - Let me put it this way.

If you were going to set up something entirely fake as a scam,

what would you do different? - Right.

- There's only a few ways to do a fraud.

You can borrow money or take cash on the promise

of delivering something in the future and not deliver it.

- Ponzi scheme. - Exactly.

And you can bring people into something that looks like

a normal web of trust but, in fact, is completely controlled by you.

One of the things that is so fascinating to me about crypto

is that... the real con is just

getting them to give you the real money in the first place.

Once they give you the real money,

then the computer screens can say whatever the computer

screen wants to say.

Absolutely. You know, when you've got, like,

$100 in your bank account at JP Morgan or wherever,

that's just a number.

But those are magic numbers that have a particular system

that we've all grown up with since the 18th century.

But these crypto guys have come up with their own magic numbers.

And you still need to have that trust that at some point,

someone's going to exchange your imaginary money for dollar bills.

And they say trust the code, but code doesn't fall from the sky.

- People write code. - Exactly.

Fraud is a weird crime in that it has a time dimension.

There is a period of time during which

the thief knows that he's stolen the money,

but the victim doesn't know that he's lost it.

Is there something about...

fraudsters that makes them different from other criminals?

Yeah.

They've got something psychologically in them,

which the criminologists call a rationalization.

They don't see themselves as deviant members of society.

And so that means that they have to

come up with a story that they can tell themselves,

which reconciles what they're doing

with their self-image as a normal member of society.

I do love my country and my people,

and I want them to thrive and to succeed.

- We put the community first, right?

So we do everything for our community, and they know it.

In the end, my goal is to do as much good as I can for the world.

The biggest lie is the lie you tell yourself.

Absolutely.

Well, as an actor, I can relate to that.

But I mean, all of crypto can't be a scam, right?

I don't like that what counts.

[V.O.] I'd listened to the false stories of crypto for long enough.

It was time for me to speak up.

So I embarked upon a campaign of my own.

- Hey, Ben. Good morning. Thanks so much for joining us.

We have about 2 minutes until we're live.

- Ok, great. - We hear you loud and clear,

so we should be all set. - Great.

- Thank you.

Hey guys, guys can you keep it down, please?

Thank you.

Sure, that's my favorite question.

It's very simple.

They were paid in real money

to convince you to take your real money

and turn it into something else.

[V.O.] I hit every outlet that would have me.

What troubled me about crypto

and the reason I felt like I had to speak out was

- it's exploited an understandable mistrust

or lack of trust with our regulated system.

The winners are far fewer than the losers.

It's being sold to the average American

as the way to make money, but--

you know, what's really going on here?

How much of this is real,

and how much of this has been artificially inflated?

[V.O.] The crypto trolls were big mad.

- He's becoming this new advocate against crypto and I'm like,

what is going on with this guy?

- First red flag was actually the word currency.

Ben McKenzie.

If you guys don't know who Ben McKenzie is,

he's now a financial guru. Just kidding.

- One of the most important things for people

to understand about cryptocurrency is that most of the volume

that you see on the exchanges is fake.

It doesn't exist.

- Just say you don't understand crypto and move on.

- Is it possible that your hostility to crypto

- If you say I haven't done enough research,

my response to you is f*** you.

I've interviewed the head of your entire industry.

- Did you see how upset he got?

- Who am I supposed to believe?

The CEO of the largest asset manager on planet Earth?

Or this actor that plays a cop on TV?

- But it really is only useful for gambling

and for criminal activity.

- Well, this is what I gotta say about Ben McKenzie.

Ben McKenzie, put your money where your mouth is.

- Ben gets no raisins. None. Not raisin worthy.

- And a lot of shady dudes end up making most of the money.

- It seems like someone is just hurt.

And I feel bad for Ben McKenzie,

because he's saying all of these things.

And then people are gonna look back and say,

why did Ben McKenzie lead me in the wrong direction?

What are you doing? I thought you were coming to bed.

Yeah, I am

- Can you let yourself out? - Yeah, sure

Dude, dude. Come here. Come here, come on.

Wait, what are we, I need to mic you up man.

- But I-- You know what?

I've been reporting for 35 years

and even though Henry Silverman said--

- Oh.

- Bro. - Holy Shit.

- The exchange FTX filed for bankruptcy protection today.

- has fallen crypto king, Sam Bankman-Fried stepped down as CEO.

- This is not a good investment.

My account has a zero in it and there are no accounting records.

Where did the money go?

[V.O.] At 4:30 a.m. on November 11th,

under pressure from lawyers, creditors, and colleagues,

Sam signed over control of FTX.

Millions of investors were left searching for answers.

- Let's go with the opposite. Let's talk about all the people

who really were drawn to this as moths to flame.

[V.O.] Despite the collapse, the crypto community was quick

to turn the blame back on the victims.

- If you are still keeping your crypto on an exchange

and you're not trading it, you're doing something wrong.

- It's a dumb idea. You don't do that.

It's stupid. You bring it home where it's safe.

[V.O.] And no matter what happened at the market,

the booster's belief in crypto would remain unscathed.

- Just like the collapse of Lehman Brothers or Enron

didn't stop the stock markets,

FTX will not stop crypto.

- Cryptocurrency, the blockchain, it's all still here.

Let me just remind you, it's all still here.

It's not going anywhere. Not at all.

Please make sure to like, subscribe, share this...

[V.O.] But no matter how hard boosters push the story of crypto,

they can't make that story true.

Because it isn't.

The collapse of FTX was a clear warning sign

that mixing crypto with our regulated financial system

could only end terribly.

It only takes one big bank to fall for the others to follow suit.

It nearly happened with the subprime crisis,

and it could easily happen again.

When trust breaks, everything can fall apart shockingly fast.

And crypto, which has never proven itself trustworthy,

has the ability to wreak havoc on us all.

- Raina? - Yeah?

Wolf?

- I'm upstairs.

Yeah?

Hey.

Look.

Wait, what is this?

Oh my god. Wow.

Wait, how did this happen?

You know.

Wow.

Frankie, come check this out.

Hey, look.

Look, see what that says?

Dear Mr. Shankin,

I invite you to appear before the commentee?

Committee?

Committee on Baking, Housing, and Urban Affairs.

I get to testify at a hearing.

I get to go to the United States Senate.

Do you know what the United States? - What's that?

- It's like the government, where the government is.

And I get to talk to the people in charge

and tell them to fix this mess.

What's going to happen here? What are you going to do about this?

♪ Which way, America? ♪

- Ooh, sorry. - ♪ Which way, America? ♪

- Daddy, what's up? - ♪ Which way, America? ♪

- How do I look? - Better?

- Did you say no? - Yes, I did.

Ow! - What? Oh. That was not nice.

That was not nice.

♪ Which way America is going to go. ♪

♪ There is many a road to travel ♪

♪ many a hill to climb ♪

♪ I'm going to find the straightest road ♪

♪ and walk it to the end of time! ♪

♪ Which way, America? Which way, America? ♪

♪ Which way, America? Which was to go? ♪

♪ This is my country land ♪

♪ I want to know ♪

♪ which way America is going to go. ♪

You fucking kidding me?

The Banking, Housing and Urban Affairs will come to order.

Thank you for the witnesses joining us today.

In this story, Bankman-Fried was the shiny object.

Now he's the villain, possibly worse.

But this story is bigger than one person or one firm,

and that's the point of this hearing.

In our discussion of FTX today,

I hope we're able to separate the likely illegal actions

from perfectly lawful and innovative cryptocurrencies.

There is the risk of investing in crypto,

and then there's also the risk of not investing in it,

and letting others accrue it's benefits first.

So, we need to get to the bottom of what happened to FTX,

but we can't let is collapse cause us to abandon

the great promise

and potential

of crypto.

[V.O.] I was up against the usual talking points.

But this wasn't YouTube.

It was Congress,

and that pissed me off.

- Chairman Brown, Ranking Member Toomey, members of the committee.

The demise of FTX and Alameda

represent the most spectacular corporate downfall

since Bernie Madoff's Ponzi scheme imploded

in the wake of the great financial crisis.

It has captured the nation's attention.

FTX owe enormous sums to supposedly sophisticated investors.

They also owe a lot of money to regular people.

I believe they, and the estimated 40 million other Americans,

who have invested in cryptocurrency

have been lied to

by a once seemingly mighty crypto industry

whose entire existence, in fact, depends

on misinformation, hype,

and yes, fraud.

In my opinion,

the cryptocurrency industry

represents the largest Ponzi scheme in history.

The fact that it has roped in tens of millions of Americans

from all walks of life,

as well as hundreds of millions of people

worldwide should be of concern to us all.

Thank you for your time. I look forward to your question.

Thank you.

And is it Mr. Schenkkan, McKenzie Schenkkan?

Yes, sir. You can also call me Ryan Atwood from The O.C.

All right. All right. Well, in that case, listen,

what is this backed by, if I could ask you?

What is this backed by at the end of the day?

Nothing. It's a story.

The story has understandable appeal.

I think if crypto serves any function,

it's to highlight the myriad failures of our regulated system

and our American economic system,

to provide people with a fair shot at the American dream.

That does not make the story true, however, the story of cryptocurrency.

What it does is lend it enormous power,

and these stories spread like viruses.

People get very excited,

these bubbles build up very big,

but then they collapse very swiftly,

and I think that's what we're seeing now today.

[V.O.] I'd said my piece, but it was too late to convince some.

They were in too deep.

- Uh, digital assets are not on trial.

Fraud...

and organizations...

are on trial.

- I want to ask the rest of you,

if we don't ban it, how do we regulate it,

isolate it from the banking system,

and then define it as a security?

Does anybody disagree with that or have any other ideas

about how it would be regulated? Mr. O 'Leary.

- The concept of passing legislation

that would ban banks from integrating cryptocurrencies

and crypto technology would make it

the most uncompetitive financial services sector in the world.

- So, let me just stop you there. I only have so much time.

So, you do not agree with isolating it from the banking system?

- I-- That's insanity.

- If we allow cryptocurrency to infect our banking system,

we will be back here.

- Thank you. - We will be back here,

not in a good way.

[V.O.] On the morning of March 12th,

as depositors raced to withdraw their money,

Signature Bank was shut down by the government before it could implode.

It was the third bank to go bust in just five days.

Want to guess what all three had in common?

- In the course of five days,

three banks have failed in the United States

and those lenders were critical counterparties

for a huge part of the crypto industry in the country.

[V.O.] Panic set in,

as no one knew just how many more banks might fall.

In the end, the government,

that super untrustworthy establishment that crypto

was supposedly rebelling against,

saved the day.

We, the American taxpayers,

bailed them out,

and customers were guaranteed all of their money back.

You're welcome, by the way.

- The jury has been selected in Sam Bankman-Fried's criminal trial,

and we do expect opening statements to start...

[V.O.] As for Sam, he was charged with wire fraud,

securities fraud, commodities fraud,

and good old-fashioned money laundering.

Oh, and the reason he was hazy on his political donations.

- I... I...

Um...

[V.O.] They were illegal.

- Regulators are now asking political campaigns to return the money.

They say that Bankman-Fried tried to buy bipartisan influence

and impact the direction of public policy in Washington.

[V.O.] After a month-long trial, it took a jury of his peers

only four hours to find him guilty on all charges.

- Do you have anything to say to your investors?

- Do you have anything to say?

[V.O.] Sam was sentenced to 25 years in prison.

How was he able to pull off his swindle?

Within the source code of FTX,

there were two lines that prevented

users from overdrawing their accounts,

but Sam instructed one of his employees to add a single line

allowing him to borrow,

aka steal,

as much money as he wanted from his customers.

It turns out you can't trust code,

only the people who write it.

- A lot of people look at you and see Bernie Madoff.

- Yeah.

I mean, I don't think that's who I am at all,

but I understand why they're saying that.

People lost money.

[V.O.] In the end,

Sam believed in the power of his own story so much,

he was willing to risk it all.

In the midst of this journey,

and with the help of my friend Jacob Silverman,

I wrote a book about everything I had learned.

And now with the tides turned,

people wanted to hear what a crypto skeptic had to say.

- You might recognize Ben McKenzie as Ryan Atwood from The O.C.,

but lately he's taken on a new role.

- He's been a vocal critic of the cryptocurrency industry,

and his scrutiny has led him to challenge its flaws and shortcomings.

- He's now co-author of the new book entitled Easy Money.

- Cryptocurrency, Casino Capitalism, and The Golden Age of Fraud.

- How did that guy from the O.C. end up writing a book about crypto?

- Well, like most Americans,

I stumbled onto crypto through a friend of mine.

- The problem was this buddy who's been an old, old friend,

he gave me the worst financial advice of my life.

- When I was in my 20s, he... - And you remember it.

- Yeah, I remembered it. And I love him.

Dave, if you're out there, sorry to out you on CBS News, but...

- um, he said, you know, you should buy Bitcoin...

- The story is so effective, because we all agree on the premise

that our current financial system is deeply flawed.

And so that lends the story of cryptocurrency a lot of power,

but it doesn't make the story of cryptocurrency true.

[V.O.] Some people got the message.

- How many of you have seen this commercial starring Matt Damon?

Matt is not the only celebrity promoting cryptocurrency.

[V.O.] Some just didn't.

- You say you did a deep dive,

and it only took me about 20 pages of the Bitcoin standard to understand

how the un-bank could benefit from this.

You think all these firms will have egg on their face?

- The advertised, decentralized future of money

is brought to you by Blackrock?

- I don't know. Bla-- Maybe. They may...

I mean, if they think it's, uh, gold,

if they think-- You think it's going to zero?

- If... I can't predict the future anymore than anyone else.

- So, if you're an American sitting at home,

and you own cryptocurrency,

and there are millions of those Americans,

maybe those viewers right now, what's you advice to them?

- I am not here to offer financial advice.

I am not a licensed financial advisor.

Many of my celebrity... colleagues,

have effectively offered financial advice...

- They said buy. You're saying the opposite.

- They said buy. I'm the celebrity who said,

be careful. - Alright, be careful.

Ben McKenzie, thank you so much...

[V.O.] I stumbled down this crypto rabbit hole

not sure of who I was,

or what I was doing.

But in playing the role of myself,

an undercover econ dork,

I not only found my footing,

but uncovered what I believe

to be the central truth of cryptocurrency.

It's just a story.

Or rather, millions of different stories spun by those invested in it.

In the end,

crypto is only a projection

of the hopes and dreams of those investors.

- You still believe in crypto overall?

- Uh, yeah. Oh, yeah.

I'm fully invested in crypto now.

- Yeah, I do believe in it still.

I still hold a lot of Bitcoin.

- Obviously, I'm not a fan of Celsius.

I think that was a ripoff. But I still love Bitcoin.

- Immediately, whenever it happened,

I mean, I wasn't trying to look at crypto or anything like that,

but I'm still in the game.

- That's fascinating to me.

You know, like, I get it.

I can understand it.

Even if I don't agree with it.

[V.O.] And as long as people are buying the story,

the crypto industry will keep selling it,

changing the narrative to fit the needs of the faithful.

The government bought Wilfredo's land for a fraction of what it was worth.

He was forced to uproot his family and build a new house nearby.

- I love the high ceilings, it's nice.

[V.O.] The only way he could afford to do that

was with the financial support of his friends and family.

In the end, Wilfredo's community saved him.

And despite Wilfredo and his neighbors

being kicked off their land,

there are still no signs of Bitcoin City.

Well, other than Corbin, that is.

- ...put it all the ways down, and then when it dropped down to 5 grand,

I scooped up as much as I could then.

and then it kind of came back up and then...

[V.O.] However, the idea of Bitcoin continued to spread,

albeit in an unexpected way.

[V.O.] My First Bitcoin is a nationwide effort

to educate the impressionable youth of El Salvador

on the magical ways of Bitcoin.

With over 35,000 graduates and counting,

an entire generation is being turned on to crypto.

Forcibly.

And Bitcoin tourists from all over the world

could come to watch kids who aren't theirs graduate.

- [Spanish] You are the example that the world is watching.

[Spanish You really can decide what kind of future lies ahead.

[Spanish] What kind of example are you going to set for the world?

[V.O.] Not weird at all.

So, was it worth it?

I feel like I was... as right

as I hoped I would be or more

and yet I had less of an effect.

What do you mean?

Sort of felt it would be like a movie and

it would just disappear, but...

- Right. - it's not a movie, you know?

It's not beautiful and perfect.

Like, people are still going to believe in crypto no matter what.

Right? Like, it doesn't matter what I say.

It doesn't matter what anyone says, really.

I'm kind of tired of being me.

I'm ready to go back to pretending to be somebody else.

Let's be honest.

I am not as interesting as the people that I play.

I mean, I wasn't going to say it.

Who should I pretend to be next?

Doctor, cop, lawyer, right?

Yeah.

I'm going to just...

become a fake cop again.

- That's good. - Get back to some honest work.

That's what I married.

Very few people would have put up with what you put up with.

So, go ahead, now that you've been listening for two years,

what is cryptocurrency, Maria? - Oh God, please.

Should've just impaled myself on this tiny, tiny knob.

Well, we've got two night scenes.

Do you want them done tonight or tomorrow?

What are the night scenes?

One is, uh, it's my low point. I'm down in a rabbit hole.

I'm in the kitchen, looking at videos...

♪ Thanks for your letter, please send a clone over ♪

♪ I'll use him for garden work and harmonies ♪

♪ Speaking of pretty new documentaries ♪

♪ Have you seen the one about the Rajneeshpuram Society? ♪

♪ Everyone seemed to think they were lunatics, but I sort of thought, ♪

♪ Hey I get this inside this rational brain of mine ♪

♪ I long to be contradicted, I wait for a sign ♪

♪ Doesn't matter what cult, what sign Just give me any cult you sign ♪

- Have a good time with your Bitcoin and...

your crypto and everything else that you're playing with.

♪ ...bandages ♪

♪ Though I'm guessing may you are an athiest ♪

♪ You'd get a reason, you'd get a goal ♪

♪ You'd know how to dress, and how to cleanse your soul ♪

♪ I'd be up for that, I'd be totally up for cleansing my soul ♪

♪ Would I have to split from my family? ♪

♪ They wouldn't know what got into me. ♪

♪ I'd change my name into something cool. ♪

♪ The world's spring grass and the leader would use me ♪

♪ as a songwriter too, I'd spread her message to the world, ♪

♪ Send in the choir. ♪

♪ Send in the choir. ♪

♪ Send in the choir. ♪