Dragonfly invested into PepperSec, Inc., the developers of Tornado Cash, in August of 2020. We made this investment because we believe in the importance of open-source privacy-preserving technology. Prior to our investment, we obtained an outside legal opinion that confirmed that Tornado Cash as built complied with the law, under the guidance given by FinCEN in 2019. The government has now stated in open court that they are contemplating charges against Dragonfly for having invested into the Tornado Cash team in 2020. On counsel’s advice, we have refrained from public comment. But we can no longer remain silent. We believe deeply in Americans’ right to privacy, and the lack of it remains one of crypto’s largest unsolved problems. We therefore stand by our investment. We did not operate or exercise any control over Tornado Cash, we had no contact with any malicious users, we always encouraged our portfolio companies to follow the law, and we maintain that Tornado Cash itself has a lawful right to exist—a view reinforced by Van Loon v. Department of the Treasury and OFAC’s subsequent rescission of sanctions. Charging a venture firm for a portfolio company’s alleged misconduct would be unprecedented, especially under these circumstances. In 2023 we received a DOJ subpoena and have fully cooperated with the government’s investigation of Tornado Cash, confident that we have always complied with the law. The DOJ has made clear that we are not ourselves a target of their investigation. As with every investment, we provided PepperSec the same advice and support we offer all portfolio companies. We believe the government’s statement in court today was primarily to undermine a defense of Tornado Cash—to make it more difficult for the defense to call Tom to testify on the stand. After all of this time—years later—bringing charges against Dragonfly would be outrageous, contrary to the facts and the law, and would induce a chilling effect onto all investment into crypto and privacy-preserving technologies in America. We don’t believe the DOJ would actually bring such absurd and groundless charges. But if they do, we intend to vigorously defend ourselves.

Crypto is getting CLARITY! + new legal categories, exemptions, and one bureaucratic nightmare. Still bullish tho! Shoutout @RebeccaRettig1 for the legal alpha! Timestamps 00:00 Intro 01:06 The GENIUS Act 04:38 Tech Companies & Stablecoins 08:38 Predictions for the Future of Stablecoins 26:25 The CLARITY Act Breakdown 32:27 Important Definitions 34:38 New Exemptions for Token Sales 41:12 Mature Blockchain Certification Process 45:27 DeFi Activity Exemptions & Regulations 48:03 New Categories for Spot Crypto Registrants 55:52 Solana's Block Assembly Marketplace (BAM) 🔥Stay updated with all the latest hot takes by following and subscribing to @_ChoppingBlock and @unchained_pod! 🎥 YouTube: 🎧 Spotify: 🍎 Apple: 🎙 Podcast Home:

When I started building my Twitter audience, I thought more followers meant more influence. But I soon realized many high-follower accounts are just engagement farmers or hyperposters with little real influence. They stir up fights and churn out populist takes, but when they take a stand, no one cares. Interestingly, the real movers and shakers often don't have that many followers. This confused me for a while. This is actually a common phenomenon, known as Berkson’s Paradox or “the tails come apart.” Two things that are initially correlated—followers and influence—decorrelate at the extremes. For most people, the value of each new follower becomes logarithmic beyond a certain point. I suspect it craters around 30-40K for most accounts. It’s different for brand accounts or businesses that directly appeal to followers, but when evaluating individuals, this was a major insight for me.