Bitcoin breaks below its 50-week moving average as Bankless hosts eye the 200-week line

Nvidia's Jensen Huang resigns amid affair allegations, and David smells a cover story

David Hoffman opens with skepticism about Jensen Huang's resignation as Nvidia CEO following reports of two extramarital affairs, one allegedly with a "Chinese intelligence asset." He questions why consensual affairs between adults would end in a CEO's removal, noting that The Economist's own headline, "Jensen Huang must go," presumed guilt before full details emerged. David lists several alternative theories, including that Huang's advocacy for open-source AI models threatened concentrated power, or that his closeness to Trump put him at odds with Democratic-aligned AI labs.

David's preferred explanation, which he calls "the razor," is that Huang was selling more chips to China than disclosed, routed through intermediaries in Singapore and Malaysia, which may explain Nvidia's recent overperformance. Ryan pushes back, noting the affairs were real and admitted, and that the uncertainty doesn't resolve into any single conspiracy. The hosts note Nvidia has lost roughly a trillion dollars in market cap, down 17% on the week and 27% in November, ahead of earnings in five days.

Bitcoin loses the 50-week moving average, testing the bull cycle thesis

Ryan walks through Bitcoin's drop below its 50-week moving average, something that held even through the recent Binance hack and a midterm-driven NASDAQ selloff. Bitcoin is down 5.4% on the week to around $72K, with the 50-week average near $75,500 and the 200-week average around $67,800. Fear and greed sentiment is at extreme fear, which Michael Nadeau's report says is worse than any point in the early 2023 bull market.

Ryan notes Bitcoin may be on track for its first-ever two consecutive red yearly candles, which would require a close above roughly $87,000 by year-end to avoid. ETH is in worse shape, down 10% on the week and trading below both its 50-week and 200-week moving averages, roughly where it was five years ago despite having since hit all-time highs.

Is the four-year cycle breaking, or is this just a dip to the 200-week line?

Ben Cowen's view, as relayed by Ryan, is that Bitcoin is "allergic to Q4 of midterm years" and his base case before the May highs was a tag of the 200-week moving average; he now says that outcome could still play out. Michael Nadeau thought the 50-week average at $76K would hold; it didn't, though he still expects a bounce, particularly if AI recovers, and does not think Bitcoin breaks to new lows below $58K, which he calls a level that would break his model entirely.

David raises a bearish read: Bitcoin "is becoming fairly priced in dollar terms," possibly falling off its historical network-effect growth curve the way gold went flat for long stretches before repricing. Ryan counters with "the number one rule of crypto... don't fade the cycle," noting the pattern broke twice in 2019-2020 without breaking the 200-week average. Alex Thorne's Galaxy framework allows a break below the 50-week average so long as it doesn't last a month or more.

"How many times do we have to hear that before we actually before it actually sinks in? We stop fading the cycle." — Ryan

Vitalik Buterin declares "ETH is money," years late according to David

At Devcon, Vitalik Buterin stated he has settled on viewing ETH as a store of value rather than a fee-collecting asset, arguing that optimizing for fee burn would push Ethereum toward corporate-style governance incompatible with its design.

"The pragmatic personal reason to kind of the financial reason to hold ETH is that ETH is money." — Vitalik Buterin

David argues this should have been said years earlier, recalling his own 2019 question to Vitalik at a Tel Aviv conference asking if ETH could be money, to which Vitalik replied it "absolutely can be money if the community wants it." David criticizes Vitalik for not taking a leadership role in growing Ethereum's economy, while Ryan is more sympathetic to the store-of-value framing itself, even as he agrees the timing, right after a brutal week for crypto, is unfortunate. Market reactions cited include Tom Lee calling it bullish and Dan Held calling it a repeated, failed pivot narrative.

Philax and Titan Builder launch a circuit-breaker system to stop DeFi hacks

Ryan describes a new collaboration between Philax, an Ethereum app-layer security startup, and Titan Builder, which produces roughly 50% of Ethereum blocks, to create app-defined "circuit breakers" enforced at the block-building level, for example preventing a vault from paying out more than 50% of its AUM in a single transaction. If a rule is breached, the transaction still lands but reverts.

The hosts discuss how this interacts with Fossil, a planned Ethereum upgrade forcing block builders to include all transactions without censorship. Philax's system lets apps make an included transaction fail, so Fossil's inclusion guarantee and Philax's app-level rules can coexist. David raises concern about centralization risk if a small number of builders like Titan effectively gain veto power, while Ryan says he is bullish given the system is opt-in and primarily targets exploits like those attributed to North Korean hackers.

CFTC approves onshore equity perpetuals, drawing a lawsuit from traditional exchanges

David explains that the CFTC will now allow registered exchanges, including Coinbase, Kraken and Kalshi, to list perpetual futures on individual equity securities if also registered with the SEC. Kalshi has already launched its product. In response, the Capital Markets Alliance Association, representing traditional exchanges like CBOE and CME along with Citadel Securities, is suing to block the move, which David compares to banks previously resisting crypto-related competition.

Other items: Ethereum Foundation's "seppuku clause" lawsuit and IRS compliance letters

The hosts discuss a lawsuit against the Ethereum Foundation from a former employee who alleges she was fired days after disclosing a cancer diagnosis, tied to a controversial internal "mandate" clause referencing seppuku that staff were required to sign. Hasu is quoted arguing the mandate achieved a "badly necessary downsizing" and improved ecosystem diversity despite the clause's poor taste, though David notes morale at the EF reportedly suffered.

Separately, David flags a tax attorney's warning that the IRS has sharply increased Letter 6174 compliance notices sent to crypto traders. The hosts clarify these letters don't require a response but are a reminder, in David's words, that recipients should "double check" their filings are in order.