Aave v3 now live, Bull case for ETH and more - The Daily Gwei Refuel #337 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the daily great review where i cap the latest news and ethereum ecosystem i'm your host heather sosano and today the 17th of march 2022 all right everyone let's get into it so i put out a tweet today very basic tweet where i just said yeah i'm thinking it's eighth season again now there are so many reasons why i'm thinking it's eighth season again and you'll notice i said eath and not ethereum but i guess like ethan ethereum um you know pretty much go going together here but like i think without giving investment advice without saying you guys should go and buy you know put all your money into ether right now anything like that i just i don't know i feel like eve has fed very very well um price wise given all the macro uncertainty currently going on i mean we

just had the fed do a rate hike right which was priced in ages ago and we knew about this for a long time right there was the wall with ukraine which definitely wasn't priced in but it didn't really do much to the eath price i mean we had a bit of a dump there but then we kind of recovered and i mean at time of recording we're at what almost 2800 like 27.70 and the 8th btc ratio is going up as well we had the evergrand stuff and we still have a lot of the the weakness in the stock market weakness in the chinese stock market as well and uh yeah i mean just the macro backdrop is not the most bullish thing in the world runaway inflation all that sort of stuff it's not the most bullish thing in the world but crypto is holding on ethe is

holding on and uh we could be above 3k any day now again so you know just kind of like taking all this into context it's actually quite amazing that eth is still where it is and i think there's a bunch of reasons for this obviously the merge is a big one that's coming up very very soon uh we have more and more people being becoming aware of the ecosystem how ethereum is going to scale um i think ethereum does very very well during the periods of time where there isn't just like tons of new people flooding in there's more of the existing people kind of you know finding their home within ethereum and within the communities within ethereum rather than kind of like going off to these things that are just pumping for whatever reason and these scams and stuff like that so i think it's you know it's a whole

mix of things that that's keeping kind of like ethereum uh up there and and and that's why i said you know i think it's eighth season now i do want to go through each of those points as well i think the merge i've spoken about a lot but i think there are so many things people still don't realize about the merge i mean i gave this answer in the daily grade discord today um someone asked me does it does the eighth merge create a halving like effect or greater than in proportion to the effect the halving has on btc as a scarce commodity and i gave four points just off the top of my head about why i think that the merge uh in for the merger's kind of like uh effect on ether as an asset and each issuance is much greater than a bitcoin

hardening and the first reason was that it's a triple hardening right it is three half of things in once it's 80 to 90 reduction depending on how much if you staked at the time of the merge it eliminates cell pressure from miners right because obviously we're going to prove a stake and stakers don't need to sell nearly as much as minus to cover their costs um it bumps the staking apy due to fear of when you go into stakers which means that more people are going to stake eighth this uh will happen because of the you know the fear revenue and also the uh the mav as well we could say 10 plus percent on vanilla staking eight uh staked eighth and then you have like all the other kind of like guild burgers that are being created around eighth obviously i mentioned that ethmaxy the

other set the other day stuff that rocker pool is doing all these sorts of things and then the fourth thing that is less talked about but you know refuel kind of like watches and listeners will know about this there is a dead zone of around six months where no new heath issuance will be coming on to the market nothing nothing guys like it's literally going to be zero new issuance coming onto the market it's i mean uh there's still being issued but it's just you can't withdraw it because withdrawals aren't coming until at least six months after the merge in the shanghai upgrade but essentially what's going to happen is you have that dead zone where uh uh you know it's essentially going to be negative because we're still going to be burning yes okay right now we're not burning as much as we used to be because

the gas prices are much lower than they used to be but we're still burning each i i checked it today and we're about fifteen thousand eighth away from burning two million each since august of last year which is a massive achievement in my eyes and i think you know obviously as uh as the market heats up again gas prices will definitely go go back up again there but those are just four of the things off the top of my head there's so many other things that i've discussed in the past about why the merge is going to lead to i believe a really positive narrative around ethereum really positive kind of like on flow effect value effect for each as an asset and just an all-round kind of like uh good good thing there now i think you know i saw a tweet today actually that i brought that i've got

here from um alex uh alexander fischer about the validator kind of um queue right now for the beacon chain so there is well at the time of alex's tweet which is around 12 hours ago now there was three hundred thousand eighth waiting to activate which means three hundred thousand eighth waiting to get into staking and as obviously as you guys know there's a validator queue so only a certain number of validators i think it's around 900 per day can actually enter staking so 900 times 32 8 gets you i think 28 000 or something like that worth of validators they're allowed worth of ethers allowed to enter the beacon chain each day and then then it's kind of like the queue that gets really long there so this crew uh i thought my head's going to take over 10 days to clear and uh i think the reason why so

many people are staking their eighth is because they they're finally realizing i guess like those yields are going to spike and they want to get in now and i remember saying these two months ago to all of you guys if you wanted to stay curious if you had 32 minimum you wanted to stake on your own you needed to get in months ago to avoid the queue because the q was zero for a long time uh but now it's heating back up again it seems that a lot of people are staking their wreath again obviously we have rocker pool which is adding to that now we have all these kind of like as i mentioned the yield burgers that are happening around that encouraging people to stake their eath and people are just getting more and more confidence in the merch happening very very soon as well so i

think as i said taking all this into account is is is quite amazing and i have another tweet here where i basically i look back at a post that i wrote in january of 2019 titled why eath is valuable and east price was 100 back then guys it was i mean it just come off like the massive bear market in 2018 down 94 saying that eth was valuable and that it would continue to increase in value in january of 2019 was the most unpopular thing to do in this space like i really do i didn't really i don't remember getting too much pushback on my piece because my twitter presence wasn't that big back then but i mean the bitcoin has dominated it back then because bitcoin had fared better than eighth during the downturn it didn't go down as much all this sort of stuff and everyone suddenly

became a bitcoin maximalist but you know being bullish on eighth at that period of time was incredibly incredibly difficult uh and and and very much not not not the popular thing to do but i shared an excerpt from that piece today where i basically said you know this massive issue introduction coming to eat with the merge is not news i wrote about it in this piece three over three years ago um but but just because now we're kind of like heating up people more people are hearing about it more people are paying attention to it they finally realize that this is coming and this is why this is why i keep saying the merge is not priced in guys like how can it be priced in if over three years ago i was talking about this sort of stuff and only just now people are

clueing into it yes to be fair eth has gone up a lot since over three years ago but i think that you know a lot of that is also due to the general general kind of like bull market trend that we saw obviously other things with each such as d5 um aip1559 all that sort of stuff which i actually wrote about a potential burn for eth in this piece too so like i'm not trying to toot my own horn here guys but like come on like all this sort of stuff is is available for a very long time and as i said yesterday or i think the day before most people are six plus months behind this industry at any given time if not much longer than that i mean the people who are just now figuring out if if they've been in crypto for the last you know four years

or something like that and they're just now kind of like figuring out that ethics having this this massive issue introduction then that's on them that's their failure because that information has been public for a very very long time it's been public for longer than i published this post because i published this post and i shared a um a little table of what the issuance is going to be like post merge so you know taking all that into account guys when it comes to ethereum i never believe anything is priced and i mean i was just talking to uh to my uh my cousin today actually went and saw a movie and and he was kind of like talking about how i showed him a couple weeks ago all the stuff happening in the layer two space he's much more interested in the nft stuff he spends a

lot of time with that but he was asking me about layer twos and he's like you know dude like how do i learn about later i'm like okay well here go to l2beat.com scroll you know go click through and click to all the resources and just like immerse yourself in all the l2 stuff and obviously you know it's a lot to immerse yourself in but this is kind of pretty much like the fastest path to get there he went to the website he went through a few of it and then he came back to me and he's like what the hell dude i had no idea all this was going on and this is someone who spends a lot of time in this industry but he spends a lot of time in nfts rather than the layer two space and to be honest like i don't spend much time in nft so

it would probably be the same thing for me if i was like hey can you show me what's going on in the nft space and i probably would be unaware of most of the things um so i i just truly don't believe that 99 of the stuff within ethereum is ever priced in i don't think it's going to be pricing for a very very long time and that's i guess one of the major reasons why i'm still so bullish on eighth after so long i'm still buying eight at this price i mean my first eighth bar was at 10 bucks guys i bought most of my eighth around you know 100 200 during the bear market and i'm still buying today even though i'm up obviously a lot on my existing eighth and i don't really ever plan to sell my i'm staking it and i'm earning rewards

and obviously i can't access those yet but i'm still earning more ethers rewards and i because i can't just look at all this sort of stuff i can't espouse and talk about what i'm talking about without kind of having skin in the game it just it won't work i get massive fomo i you know the funny thing is even though i'm buying every day i still get fomo when the eighth price starts going up cause i'm like oh my god no stay stay low for a bit longer so i can buy in some more and i know a lot of people feel that way but i mean you know come on when you take all this as a holistic view and you look at this and you kind of like see everything that's coming for ethereum 48 as an asset and you see how many people

just don't understand uh all of this sort of stuff it's very very hard not to be bullish and i know i've gone on about ether as an asset a lot lately in the merge and all that sort of stuff but i really do think it's incredibly relevant i really do think it needs to stay top of mind for you guys but i'm going to leave it at that for now i do have a couple of other merge things i want to talk about but i'm going to leave it at that uh there for for you guys today uh hopefully you're bullish enough after that um as i said it's not investment advice i'm not gonna go tell you to buy either this price and sell either that price do anything like that i have no idea how to do that i mean i've never done that but i'm just trying to get

kind of like my point across as best i can to keep you guys as kind of like close to the way i'm thinking about this as possible so you can make more informed decisions for yourself at the end of the day all right speaking of the merge stuff that i wanted to talk about terence from the prylabs team shared a uh article here going over the bug that prism had during the kiln merge test net so you can see here it's a bit of a technical bug you can kind of like read through it it's only a short read but it basically shows like why uh you know there was a bug in the prism client here it's great to see that a post modern came out so quickly right um and there's kind of like a root cause resolution all this sort of stuff and

detection and all that all that stuff obviously this is the stuff that we want to find in the test nets i said yesterday or the day before that i don't believe this would require um another test net to be spun up but i could be wrong here there could be one more test that gets spun up but i don't know i haven't gotten that that kind of like feeling from anyone at this point i haven't seen anyone kind of like talk about another test that needs to happen or anything like that and as far as i know since it's kind of like this bug the kiln test net has been running perfectly fine that i mean for the last couple days it doesn't seem that there's any kind of um you know hiccups there so very very cool to see that it seems the merge is coming along very very nicely

and just a kind of like another tweet here from jazek who works on the nimbus eth2 uh client or consensus layer client um they've actually been able to cut memory usage down by another 250 megabytes so now running a validating node using nimbus only takes up 750 megabytes of uh of memory of ram right now the reason why i wanted to highlight this is because this is i mean this may be boring to a lot of people but this is very in line with what ethereum is trying to do so ethereum i guess like the reason why ethereum proof of stake has taken so long is because we wanted to find figure out a way to allow anyone to run a validator on on kind of like cheap hardware yes obviously running a validator requires 328 and back in the

day 32 was worth a lot less than it is today especially when a lot of these decisions were being made it was worth three four thousand dollars back then obviously it's worth a lot more today but keeping these things like very very um i guess resource insensitive so sorry and not not resource intensive is very very important and also because a lot of some of this stuff also affects the beacon node which you don't need 32 eth to run and that's actually one thing i want to i want to state here as well there's a really bad narrative going around at the moment that i've realized around the merge on top of the other two bad narratives that i've spoken about before but this one's got to do with people believing that you need to have 328 in order to run a fully validating node post merge

no guys you can run a fully validating node known as the beacon node and the execution layer node without any all you need is the hardware you don't need any eth at all i don't know where this narrative came from just like i don't know where the other narratives came from probably some kind of like youtubers who don't care to do their research but i just wanted to kind of like get that out there but as i said improvements like this are improvements for the whole network as a whole making it easier to run on kind of low-cost hardware is definitely what we want to see and in the future once uh kind of like the merge is done there's going to be ways for people to basically pull their eth but have validators on their own machines that's really cool and that's another thing i should talk about

another time but what it basically allows you to do is that you can have a validator running on your kind of like pc without having the 32 uh um required to to do that right you kind of like pull it together and do all that you can already kind of like do it with rocket pool but um you know i'm talking in like a fully self-sovereign way sort of thing um and uh we kind of like without the the i guess like outside of rocker pool um but like it's a it's a bit of a different implementation as well but anyway i'm not gonna talk too much about that today i got a bunch of other things to get through but cool to see that uh resource um you know race that there that um that nimbus is less of a resource hog than it was before

all right so polly now pointed out something in uh i guess like one of stark nets or starkware's uh correspondence about net where they say i know i'm late to ask but is there more information about this if and and this being uh performance improvements coming to stark net alpha v 0.9.0 which is expected in the first half of april which one of the performance improvements is paralyzing the sequence's execution of transactions now as polynomial explains here if this means what i think i wasn't expecting this until 2023 i mean this belief that the programmable zika that a programmable zkr zero knowledge roll up with parallel transaction execution as a mere few days away don't be me don't underestimate starknet now why is this a big deal why is parallel transaction

execution a big deal well this is something that ethereum does not have the evm does not have this the evm cannot do this it cannot process transactions in parallel this is something that actually solana does have this is the one maybe one of the only innovations that solano has done that i actually um consider to be an innovation that i actually consider to be pretty cool um and now this is coming to stark net because obviously stark net is not bpm compatible it's not built on the evm and they're going they're kind of like building this from scratch now that's not to say that these evm compatible l2s can't introduce parallelization i'm pretty sure it's on their roadmap but i believe it's a bit harder to do they have to kind of like play with a bit more things there but uh but yeah i

mean as paulinho says don't underestimate stark net guys i mean i know that they're taking long i mean they're not even taking that long to roll out but i know that they're not at the stage yet where some of the other l2s are generalized l2s are but that's because they really are building something from scratch here and i think if they can execute this uh like they like they say they're going to be able to execute this it's going to be massive it's it's just being able to process transactions in parallel i mean i wish i could give like a quick example here but i just i just nothing's coming to mind right now i've gone blank on that but essentially being able to process transactions in parallel leads to such a speed up of kind of like um transaction processing it's it's insane and then you add on all the the

speed up that we get from just like z cars in general and all that sort of stuff and then hardware acceleration comes into it my god guys like the layer 2 space is just continues to amaze me continues to make me so incredibly bullish on the ethereum ecosystem and continues to impress me with how uh you know hard and smart uh working these teams are because at the end of the day this stuff is hard guys like this isn't easy stuff this is bleeding edge cryptography bleeding edge kind of like blockchain design because at the end of the day layer twos are basically block changes without the consensus part um and and the fact that it's coming all so quickly much quicker than even the top minds in this space thought uh is is really awesome so i just wanted to kind of like point that out there

um and uh yeah i think that if starkware can pull this off with stocknet it's gonna be a very big deal for everyone not just uh i guess like the um the researchers and developers but obviously the users as well all right so speaking of layer two zk sync shared a kind of like a newsletter a new newsletter on sub stack today called pageone.substack.com and this is a post that they did basically titled the zero knowledge landscape which is an overview of the current zero knowledge scaling ecosystem so if you want to know i guess everything there is to know about the current zero knowledge ecosystem inside and potentially outside of ethereum you can go to this post and it has a bunch of links to so many different things guys you could spend a very long time going down this rabbit

hole here um you know there's a bunch of news there's a bunch of kind of like you know who are the current players what are they building what are they doing links to all that sort of stuff here just wanted to kind of like highlight this and i think you know page one is a newsletter that does just general crypto recap so if you wanted to i guess like subscribe to this to get kind of like information each it seems each week here uh you can do so so but this one i thought was really cool the zero knowledge uh landscape because it kind of like brings all these resources into one place and allows you to easily kind of like uh uh you know dive deep into the zero knowledge stuff without having to go around and find it for yourself so definitely check this out it'll be

linked in the youtube description below all right so sukheil here on twitter i announced something today that just kind of came out of nowhere called owl tube which is a youtube which is youtube but decentralized so as suhail says here our tube is an open source web3 video sharing application built on top of poly of the polygon blockchain using and these are all the kind of like um i guess this is the stack that they're using and there's there's also a demo so as i said this is live today right now so i i believe it's live um i'm actually i'm not sure i think this is kind of like a demo here showing kind of like obviously a youtube like video player but built on the polygon uh polygon kind of blockchain here using um infuria ipfs uh to kind of like store data and things

like that and it is open source of course and you can go to the github and check out all the code and everything but this is cool i think you know the the less talked about aspect of this industry is things like decentralized social media decentralized kind of like websites all that sort of stuff and that's always be i i believe that's always been because it's been much harder to create these things they've suffered especially from scaling issues i think that decentralizing them is also quite difficult we've seen a few attempts at this i mean i think the most famous attempt at a decentralized social media platform was steam which actually ended up getting getting taken over um you know through a hostile takeover by justin sun and then they kind of like forked off into steam and hive and i think they've still got an active

community on hive there but steam i think had the had on chain governance sir justin's son was able to essentially amass enough of the tokens in order to vote um you know himself as basically a dictator there and then kind of community forked off which is a really cool feature of blockchains by the way the fact that we have the right to exit via fork and we can kind of band together and fork and kind of like go do something else instead of kind of like staying on the on the the chain that has just been taken over uh through a hostile takeover but yeah i often wonder like how you would do governance on things like this i you guys know i'm a pretty big bear on on chain governance especially for things that uh i mean i'm not maybe not necessarily a bear on on train

governance for defy apps but definitely for layer one block chains and obviously this out troop thing isn't an ally one blockchain but i don't even know if it makes sense to have governance for something like our tube i think rv has it right with what they're building with lens protocol where what you want to do is you want to build a bunch of primitives you want to build the protocol the smart contracts and then you want everyone else to build their own front ends on top of that and you want to keep those smart contracts and and primitives as solid and as immutable as possible and i think that's what unisop got right where uniswap has always been governance minimized has always been i guess like something that uh essentially allows just everyone to build upon you know compose with interrupt interoperate with and all that

sort of stuff and that's why they've been so successful this that's one of the reasons why they've been so successful of course and i think that that's why i was really bullish on others attempts at decentralized social media with lens protocol which is in its early stages but the fact that they're just building kind of like things like apis and um you know the smart contracts the primitives instead of basically saying hey we're building decentralized social media but you have to use our front end and everyone can change things on the front end by going through governance uh i don't know guys and i feel like the back end for something like this doesn't really need to change that often i mean there are certain core things you would have to have obviously uh for for decentralized youtube but the front end i mean you could edit that and

that could be totally centralized as long as you have a bunch of friends that people can use and then worse comes to worse if there's no front end that you can use you can literally interact with the contracts directly if you have value locked in them let's say there's kind of like a wallet that exists alongside or a kind of like a i guess like a vault that exists alongside something like this and you want to interact with it to get your money out or something like that um i think you know that way you could just do it directly through the chain so there's always kind of an opportunity to do that but uh yeah cool to see this i'll link this in the youtube description and you can go check it out on github all right so speaking of rv big announcement from them today ave v3 is

now live across six different networks i believe and from what i could see i don't think they deployed this to ethereum mainnet i think that they've just deployed it to polygon phantom avalanche arbitrary optimism and harm and harmony yes that's right if you remain at the point will be determined by the community based on the maturity of the currently deployed markets this is cool this is really cool especially the l2 stuff because obviously with ethereum mainnet um it's pretty much inaccessible even at these gas prices to most people and as i said before i'm really bullish on layer two native protocols but why not layer two native uh protocols that are different like different versions of the protocol so other v3 not being on the ethereum main at least not yet and launching natively on layer twos and i guess the other evm compatible chains is a

different way of doing things and i was actually pretty surprised by that i thought it was very very cool but outside of that you know v3 brings with it a bunch of really awesome features i think their portal feature which facilitates the cross chain cross l2 transactions is pretty interesting they've got high efficiency mode which unlocks higher borrowing power isolation mode for allowing new assets to be listed while protecting the protocol this i think takes inspiration from euler protocol which i've spoken about before gas optimizations across the board so gas costs for all functions reduced by 20 to 25 percent and more um specific features for l2 networks community stuff risk management i mean there's so much packed in this ava v3 release and as i said when they launched on testnet a few weeks ago i was expecting mainnet very very soon well here it is not that it's

on ethereum mainnet it's on the kind of like i guess main nets of uh these other chains but i'm sure a lot of you are already on there right now and as i said ava was one of the key missing pieces to the optimism and arbitrary networks and now they're it's on there and obviously on polygon pos chain as well so very very cool to to see that definitely go check this out if you haven't already obviously i'll link it in the description um and uh and that's it there very cool to see this live all right so finally here we have another update from alcomix uh we've introduced something called gl alcx which is a new draft version of the alcx token designed for cross chain and layer 2. when you wrap alcx for ga alcx um we stake being the protocol stake and auto

compound your alcx this saves you claiming rewards and restacking manually it's a very gas efficient way to do this and then you can transfer gal cx across you know different chains and different l2s and i think this is a really great way to do things like this because obviously there's i mean okay so there's two ways to do these bridges two main ways to do kind of like uh bridging of assets one of them is just to lock it in a smart contract on the parent chain and issue it as an iou on the bridge 2 chain and the other way which make us talked about recently is to essentially burn the kind of like token on the chain that it's being bridged from it and so that it only exists on the one that it bridged to so there's no iou it's the actual kind of

real token um and then obviously i i guess like this is a third way of doing it just kind of like wrapping these tokens together and being able to i guess kind of do stuff in the background for for holders of the token as well or preserving cross-training across l2 stuff so very very cool these are the innovations that i like to see guys i mean i wrote about this in the delight newsletter today but i basically said that i don't think there was very many d5a innovations in the kind of like d5 2.0 thing i think most of d5 2.0 was ponzi's and money games and it's not necessarily a bad thing but it wasn't really innovative for defy it wasn't really adding you know value on financial transactions and i wouldn't even call it defy i mean as i said they're money games and ponzi's and things like that a

lot of them ended up collapsing rip frog nation am i right but uh you know when i kind of like look at the innovation that actually happens uh within d5 it's stuff like this it's the cross chain stuff it's l2 specific designs it's what's what ave is doing it's things like um protocol owned liquidity which is actually part of the d5 2.0 stuff but i think protocol owned liquidity is a really really cool innovation of d5 more generally uh but yeah much more cooler than just kind of like creating these ponzis that auto compound and kind of like require new money to come in in order to keep going up and then rebase and all that sort of stuff look call them whatever you want guys money games ponzi's whatever as i said i don't necessarily think they're bad but don't lie to yourselves about what they are don't say that this

is the future of finance this is going to be you know have run kind of like does their financial activity this is going to be the new standard money don't don't just lie to yourselves like that be honest with yourselves with what this stuff is i think it's much better for the space it's much better for you personally and it's also much better from an investing standpoint too if you if you lie to yourself about what something is i think you're much more likely to lose money on it as an investor because you're essentially saying well you know i you know you you're essentially saying this is something that it isn't and you're making a bet on something as if you believe that it's something that it's not and then when a reality comes and hits you and basically says well no i'm actually this not what you believe i

am then you stand to lose money and i think this is what happened with a lot of the frog nation projects especially the um the wonderland project people are like you know this is going to keep going up forever this is awesome you know we're all going to make money we're all going to make it blah blah and then it came crashing down really really hard it's down like 95 plus percent of its all-time high and that's the reality settling in so if you don't want to lose 95 of your money um or you know or maybe you know anywhere from like 50 to 95 of your money probably best to take these things into consideration and think more deeply about them uh but yeah i think on that note last piece of advice there from from me on kind of like what to do in these sorts of

situations but i'm going to keep an eye on more of the kind of like actual innovations within dfi and let you guys know about them as well but i think that's going to be it for today so thank everyone for listening and watching be sure to subscribe to the channel if you haven't yet give the video a thumbs up subscribe to newsletter join the discord channel and i'll catch you all tomorrow thanks everyone