Scott Melker is the Wolf of All Streets. He is a trader and investor both privately and at TexasWest Capital. He is the host of the popular “The Wolf Of All Streets Podcast,” the author of “The Wolf Den” newsletter, and a prolific writer and thought leader in the crypto space. He is also an advisor to a number of blockchain-based projects and has been featured in many big magazines like the New York Times, Forbes, Businessweek, The Wall Street Journal, and many more.”
Interview Date : 30th September 2020
Is Crypto the Reason for people getting scammed?
We don’t need crypto for people to get scammed. I get probably 3~4 phone calls a day telling me it is the IRS, and that there is a warrant out for me. These are common things, and scammers have prayed on all kinds of people since the beginning of time. Scams are not unique to crypto, but it is easier because of the web-savvy community engaged on social media. As everything is technologically based, it is an easier barrier to break. I don’t touch things that I think could even potentially be a scam. One has to be very careful with the kinds of projects that are emerging. I size my position on a lot of the DeFi projects in case it would go to 0 in value, so it would be a small loss relative to my portfolio.
Have you been hacked?
I have been hacked, and sim-swapped, and those have been some of the worst experiences in my life. I am one of the few people who have my face and my name on my Twitter profile. I was a public personality before joining the crypto space. As I cannot be anonymous, I have become an easy target for many hackers. I took some drastic steps to protect my money, my family, and myself because we would get extreme threats and calls from scammers. Today, I have made it almost impossible to access my coins. I switched off from the major cellphone careers in the United States and now work with a company called EFANI. My friend, Haseeb Awan, runs a phone service for people who want to make sure that their sim card is protected. Instead of imposters calling T-mobile convincing them they are me, the scammers have to call Haseeb’s team, go through a 12-step process, and show their face on video for verification.
How often do Sim-Swaps happen?
Charlie Shrim, who is also registered with Haseeb’s EFANI, was sim-swapped 3 times. Anthony Pompliano and Jason Williams talked about their experience of being sim-swapped too. For them, it escalated to the point the FBI, guns, security forces were involved. Jameson Lopp is another influencer and cypherpunk who has also received similar threats. Scammers are insane, and they can go to limitless ends. Crypto is looked at as a much more accessible asset of value than the Dollars.
I do not think scammers think of such actions and behaviors as extreme. I had Haseeb as my guest for a podcast to teach us about the scamming world. It scared me to know how easily accessible our information is, and how easy a sim swap is. Sim swappers can go on the dark web and buy hundreds of phone numbers and names. They can receive your basic information for pennies, and no one is spared. After a little research and some social engineering, they find your name, email address, and your phone number. Then. They proceed to find out if you trade crypto, which are all easy things to figure out. Scammers learn facts about your family from Facebook. Next, they go on your social media to gather more information about you to build a fake profile of you, which requires your phone number. So, they call your phone career company and convince them that it is you to switch your sim into theirs. That is one way only one of the many methods.
The second method is much simpler but frightening. The scammer bribes a person who is making 10 dollars an hour at a phone company. The scammer convinces the employee to sell the client’s information and does a sim swap for some 1000 dollars. Even if the scammer would be unsuccessful 9 times out of 10 tries, on the 10th try, they steal a million dollars, so it is worth it for them. This is like their job, and most of them have an insider at a company.
What is financial literacy?
I believe having smarter people around is a private equity. Sahil Bloom, a good friend of mine, is like an advisor for my business and he is brilliant in guiding me in my financial life. We have a passion for education and aim to make people financially literate. I don’t know the situation in other countries, but financial literacy is not even on the map in the United States. Unfortunately, it is not yet to be considered important enough to be taught. I still remember facts about wars the United States was engaged in decades and centuries ago, but no one taught us how to balance a checkbook or how to use a credit card. Simple economics is what ought to be taught and understood.
If you went even one year to a school where they taught you about monetary literacy, and how to invest, it could change your future. If they taught us about “how to purchase a stock” in practice, it would change an individual’s financial situation. Also, everyone should understand taxes, but nobody does. It just seems very obvious to me that financial literacy 101 should be part of the core curriculum of our educational system. Statistically, it has been shown that people who have had even the smallest education in financial literacy, have gone ahead in life with savings and a better financial standing.
“Short the Bankers, Long Bitcoin”
They say that Bitcoin is used for criminal activity, but nothing has been used for such activity more than the US dollar. And the banks know about it. To me, something like the FinCEN news story was like someone telling me “guess what, the sky is blue and water is wet!” We know that banks assist criminal enterprise and that governments are involved as well. There is a reason that Bitcoiners say “Short the bankers, Long Bitcoin” as Anthony Pompliano stated. Banks are corrupt. The whole banking system structure is meant to enrich the wealthy and hold down and discriminate against the poor.
Does SNS Influence your trading?
As a trader, I look at my analysis and make my own decisions. I am not affected by what is put up on social platforms. For example, Twitter is the best social media platform in the world for finding information fast. However, the problem with a social platform anywhere is discerning good information from bad information. It is recommended to have a base level of knowledge before engaging in the trading community on Twitter. If someone does not know how to trade, they should not go to Twitter to learn about it. Most of the people who do that will end up buying something with no knowledge about the asset, no plan and there is no accountability, so they will end up losing money.
For me, Twitter has been a blessing in that it has allowed me to have a successful newsletter and podcast. Being a part of the crypto community has been incredible, but I remember when I first joined it. Not knowing what was going on, I found it very difficult to navigate the waters.
Tribalism is Meant for Humans
As far as politics is affecting the country, today, the United States looks like “the collapse of a kingdom”. It is a clown show, and thus hard for me to be passionate about it. I think at the core of humans, tribalism is an innate part. People want to associate with a group, which could be the same religion, country, nationalism, sports team, and political views. The two-party system is the right example of that. Nobody can agree with everything one or the other says. You could be passionately pro-life and believe in flat tax rates, which would make you a republican. However, you could also think that immigrants should be allowed at the same time. So, you have this cognitive dissonance to associate with one of the other parties. Yet, until 2020, you had a president like Trump, who does not ascribe to either party. All the Republicans become what Trump says as opposed to the core principles of their policies.
We need to have a constructive discourse over issues. I respect anyone who has an opinion or an educated feeling on something specific based on facts and education. If you are passionately on the other side of an issue from me, and you have a good reason and explanation, I respect that. However, we live in a world where you just say things not based on any facts or truth. What is even more dangerous is that people view their opinion as a fact. It is sending us on a downward spiral to a failed economy where capitalism does not exist. What we have today is “corporate welfare” and “socialism for the rich but not for the poor”. Moreover, it is the very same rich people who are benefitting from all these bailouts and free money who tell you how bad socialism is. We do not have any rational discourse anymore. We are in this post-fact dystopia where anyone can say anything they want, and the audience will believe it. Fake news is read X times faster than real news, and you can say anything on social media, and if enough people retweet it, it becomes a fact.
Interviewer , Editor : Lina Kamada
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