Adam Sternbach

EDGAR but for DeFi protocols’ security setups. Who is building this?

@PEoperator @EtzkornRich When you do Bryce and Capitol Reef, you absolutely must do this drive. Give yourself at least a day and take some of the scenic offshoots. visitutah.com/articles/the-a…

@EtzkornRich We didn’t have enough time for Bryce or capitol reef. Have done Zion before but want to hit those two. Will add sand dunes to the list!

Last week I visited four national parks and several national forests. I left with three major conclusions: 1) Our National Park Rangers are Chick-fil-a level quality. I never met one who was anything but go-out-of-their-way helpful even on the most mundane topic. 2) Our National Parks are an absolute treasure. You don't need to go out of the country, America contains a million different worthwhile sights to see. 3) National Parks should be free for US Citizens. The "America the Beautiful" pass is $80 for a year of entry into any National Park. Easy decision, but I would take it a step further. National Parks should be free for US Citizens and $1,000 for a one week pass otherwise. Build American pride and generate revenue. National Parks feel like the one thing the government has consistently gotten right.

@JacobRobinsonJD @AlexanderGrieve I guess it depends on the starting point, but I’d generally take those odds.

@AlexanderGrieve I didn’t wake up thinking I’d see a member of Congress saying that 99.96% of prediction market users lose everything. I have now seen the most ill-informed take of the day. Time to log off.

I have neither lost everything nor won billions, maybe I’m doing this incorrectly…? Skill issue perhaps

@JBSDC Feels like we’re not too far away from socialized airlines. Similar to major highway systems and transit services.

It’s forgotten now in the echoes of history, but one thing that helped consolidate the airline industry in the early 90s was the Gulf War shooting up fuel prices and forcing airlines into bankruptcy or even liquidation. nbcnews.com/id/wbna3073561

@garypalmerjr Perhaps. Or it would be imbued to the person/entity who deployed the agent and the agent would be considered to control it, but not own it.

@adamsternbach ENS/.eth names (and NFTs) are property, and agents can own them 🌱Ξ

AI agents cannot own property. AI agents can control property. Understand the difference.

@RagingBitcoin No clue—not a trusts lawyer. Presumably depends what property interests we’re talking about but my overall point is the law does not recognize agentic ownership—it ties back to the person/entity who deployed the agent.

@adamsternbach how would it play out if an agent is the sole executor and beneficiary of a trust?

So Anthropic just developed the most powerful model ever and it can’t be released to the public. We constantly talk about how these models are only improving and they are currently the worst they’ll ever be. What is the model endgame exactly and why aren’t we already there?

@mcuban This is likely already the law where the builder maintains control over the agent—API keys, compute resources, etc. The much more interesting questions arise when 1) the builder relinquishes control and 2) agents begin to spawn their own agents who act fully autonomously.

A smart politician would offer legislation saying “if your agent does the crime, the builder does the time “ “It wasn’t me that hacked the bank and deposited all that money in my account, it was my agent. It did it on its own. Don’t blame me !”

The way I see this is basically the need to create an entirely new type of entity under state law (similar but different than an LLC) that has the ability to issue tokens and embed those tokens with certain rights via some publicly available charter document that can only be updated upon XX days notice. This is far from a complete idea, but conceptually I think this is need to fully realize the potential of tokens (additional potential securities considerations need to be further thought through but I don’t think that should be a barrier to a better token “product”). Property interest ties back to some form of ownership or governance of a protocol/application (I generally view tokens as product equity as opposed to corporate equity) and the cash flows/revenue generated therefrom + potentially governance, a form of information rights, enforcement rights, etc. This isn’t necessarily a solution for every project but I think it can be a very important tool for the vast majority of projects issuing tokens. On the decentralization point, I don’t view decentralization as a goal in and of itself. There is merit to technical decentralization (distributed validator sets, certain admin controls, open governance) but generally think operational decentralization (BD, marketing, product development) needs to be centralized to be effective. This likely applies more to app layer than infra but it certainly could apply to both. Clarity and any SEC investment contract framework/exemption is generally going to require some centralized actor to make disclosures. This entity type would further establish the ability for those types of projects to do so effectively and with specified legal rights for tokenholders.

Ah, I see. But then what does that property interest tie back to? I agree that it's important, just trying to piece this together. Typically, the goal is decentralization, so the tokens aren't per se tied to the "issuer," so to say. Like, I think about stocks and there's a sensible property interest in stock that ties back to the "corporation" in that context, but here, is it a property interest in a token ties back to the protocol, or does it exist independent of the protocol? That's where I get stuck. If you're custodying your assets, your remedy would be contract. The issuer implied contract (e.g., a, like, Section 12(a) of the Securities Act claim, if sold as an investment contract) would be sensible. I guess I'm just a little stuck on the ultimate goal of having a property interest here (though I also acknowledge I'm just a litigator who does not know much about this!)

For tokens to succeed, we need state law that attaches property rights to tokens. Just like how it works with stock. This should become the industry’s focus post-Clarity (whether it succeeds or fails). Otherwise, tokens are vibes and nothing more.

Largely grounded in the question of token value accrual. Currently, any rights associated with token ownership are generally governed by a loose implied contract claim with the token issuer (but can be very attenuated and subject to challenge). In order for a tokenholder to have a proper claim over some form of value—whether protocol generated cash flows or revenue or even a promise by the team to use revenue to conduct buybacks—there needs to be some embedded property right, not just a contract claim. This has tax implications that need to be resolved but shouldn’t stop progress on the issue. Stocks accomplish this via statute. I think tokens need a similar solution or else they are always going to have questions related to value accrual/rights enforceability. Granted this raises security questions but 1) we’re much better positioned to solve those under the current admin and 2) it’s nothing that the SEC’s investment contract exemption rulemaking shouldn’t be able to resolve (and frankly disclosure is the end goal we should be working towards anyway).

@adamsternbach What’s the underlying legal purpose of this? Asking genuinely, trying to learn more

This is why we need decentralized chains.

PSA to the TradFi institutions: Find one cryptonative person to review your marketing copy Don’t be this meme

We finally found the thing that can unite Solana and Ethereum communities.

SEC and CFTC are the David Goggins of regulators. Incredible pace and output.

Everyone is rightfully paying close attention to the SEC’s guidance from Tuesday. But this speech from Chair Atkins is the SEC’s roadmap and contains promises about what will be delivered. Wait, did the SEC just create an investment contract? 😜🤪😉 sec.gov/newsroom/speec…

Some early morning crypto fun if you’re into this sorta thing: ETH is a digital commodity. That much is clear. But are secondary market transactions in ETH securities transactions because the Ethereum Foundation has made promises related to its development roadmap?

@MikeIppolito_ We’re VERY far from getting everything. This is undoubtedly a good day and multiple steps in the right direction but there remain many unresolved issues.

Kind of wild crypto got everything it wanted. SEC and CFTC have provided clarity. Wallets won't be forced to register as broker dealers. Protocol founders aren't getting arrested. Banks are in too. The downside is now there's no one to blame and we actually need to ship 🤷‍♂️

RIP points programs