Crypto Power, Political Pressure, and Real-World Risk

Speakers

Katherine Wu — Host / Starkware

Jesse — Rivet Capital / Former Web3 Prosecutor

V — Former SEC / Web3 Legal Expert

Summary

Physical Risk is the New Systemic Risk: The panel highlights a disturbing 75% year-over-year increase in physical "wrench attacks" on crypto holders. This shifts the narrative from "digital hacks" to real-world safety, creating an urgent catalyst for privacy technology and reversible transaction layers.
CFTC vs. States on Prediction Markets: A major constitutional battle is brewing. The CFTC is aggressively asserting federal jurisdiction over prediction markets, directly challenging state-level bans. This signals a potential federal "moat" for compliant prediction platforms.
Human Trafficking & Crypto: Acknowledgment that crypto flows are increasingly tied to industrial-scale human trafficking (pig butchering scams), which may invite severe regulatory crackdowns on non-compliant on-ramps.

Trade Ideas

Ticker	Direction	Speaker	Thesis	Time
PRIVACY INFRASTRUCTURE /ZK PROOFS /STRK	LONG	Katherine Wu Host / Starkware	Physical attacks on crypto holders (kidnappings, home invasions) have risen 75% year-over-year. Criminals are using public ledger data to target individuals in the real world. The transparency of public blockchains, once a feature, is becoming a physical liability for high-net-worth individuals. This creates a non-speculative, safety-driven demand for privacy technologies (specifically Zero-Knowledge Proofs) that allow value transfer without exposing net worth to local criminals. Long Privacy Infrastructure and ZK-rollups (like Starknet) as they transition from "regulatory evasion tools" to "personal safety necessities." Regulatory bodies may conflate personal privacy tools with money laundering facilitation despite the safety argument.	—
PREDICTION MARKETS /POLYMARKET	LONG	Katherine Wu Host / Starkware	CFTC Chair Behnam explicitly stated the agency "would no longer stand idle" while states infringe on their jurisdiction regarding prediction markets. The CFTC is effectively positioning itself as the federal shield for prediction markets against a patchwork of state-level bans. If the CFTC wins this "federal preemption" argument (likely heading to the Supreme Court), it legitimizes the asset class and removes the existential risk of 50 separate state battles. Long the sector. The regulatory headwinds are converting into a federal framework that favors established players. Supreme Court rules in favor of States' rights, fragmenting the market.	24:05
CEXS /COIN	LONG	V	Physical coercion (muggers forcing transfers) is forcing fintechs like Revolut to implement time-delays and "reversible" features. Pure, instant, irreversible self-custody is becoming too dangerous for the average retail user due to physical threats. The market will shift back toward centralized, custodial intermediaries (like Coinbase) that can offer "safety friction" (delays, identity verification) that hardware wallets cannot. Long compliant custodians as the "safe haven" for retail wealth against physical extortion. "Not your keys, not your coins" philosophy remains strong among crypto natives.	18:13
XRP	LONG	Katherine Wu Host / Starkware	Ripple is making high-profile charitable donations (cancer center), and "everybody's mom and grandma loves to buy XRP." Despite technical or legal criticisms from the "crypto native" crowd, XRP retains massive, sticky retail brand loyalty ("normie" appeal). The company is leveraging its profitability for "Good Citizen" PR, reinforcing this retail trust. Long XRP based on retail sentiment and brand resilience. Continued SEC litigation or lack of actual utility adoption.	61:16