Arbitrum raises $120mil, ETH issuance drop and more - The Daily Gwei Refuel #198 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the daily gray refuel where recap the latest news in ethereum ecosystem i'm your host anthony sosano and today's the 31st of august 2021 all right everyone let's get into it so 31st of august last day of august for arbitrary to go live as they've promised you know over the last i guess couple months or maybe another couple months i think it was like uh back maybe it was back in july when they first announced that they were going live in august but essentially you can see they put out like a teaser video today uh kind of saying oh i guess it was like yesterday for for a lot of you but kind of saying details to follow tomorrow about arbitrary um and you know you can see this little video here it's really nicely made i actually really liked it

uh but yeah i'm sure i'm sure all of you saw that already uh but then just about an hour ago the block announced that abertram has raised a fresh round of funding so they have 120 million dollars in new funding as part of a series b round here that was led by lightspeed venture partners with participation from mark cuban and others now i don't think that albatro maynard is live at time of recording even though the headline kind of says that he's here uh but yeah they just announced it's kind of like this this series b funding at a 1.2 billion valuation so pretty pretty uh high valuation there uh maybe 10 now is a good time to to uh to say i don't know if i've said it before that i participated in arbitrary series a round uh that is public if you dig around but

they never really i don't think they ever announced their their series a um but essentially you know they've announced this series b here and that's brought them up to a 1.2 billion evaluation with this fresh round of funding i didn't think it was quite funny that alameda research participated in this round because they're very big on the salina ecosystem and yet they're participating in like ethereum scaling uh solution rounds but i mean it makes sense they're they're a fund uh you know they're a trading firm they're not really going to be i mean they're going to go with them without kind of like where they think they can make money right at the end of the day but anyway that was just like a little side note there um but i'm excited i mean i'm sure maybe by the time you're watching this or kind of like maybe you watch it slightly

before trim goes live or whatever um but i'm hoping that arbitram's i mean the arbitrary one network i should say is live and you guys are all using it but this is super exciting i mean this is a lot of money right 120 million dollars on top of what what they already kind of raised as part of the series a um and their original seed this seed was a little while ago now though so they probably ran out of that but like the series a and series b um and they're planning to hire more people they've they're currently only got 14 people working at off chain labs which is the company that builds arbitrarium um but um gold feder here the i think that the ceo of of off chain labs here says that they're going to use that newly raised capital to grow their team

obviously and continue to invest heavily in r d and they're saying that they're working on more solutions to scale ethereum than what they already have with arbitrary one which is really really cool so yeah i mean this is this is awesome obviously uh i can't wait to see the mainnet go live today i'm you know what i'm probably going to be asleep when that happens but i'm sure i'm sure i'll be able to cover it on tomorrow's refuel but yeah great to see them kind of like announce this new funding round um that's a lot of money to keep them scaling ethereum here and you know i don't think they're going to be the only one raising this amount of money at a massive valuation scaling is front and center for pretty much everyone in the ecosystem right now not just ethereum but like crypto in general

the scaling wars are well and truly here we have kind of like the the um the early adopters coming on board i would call like all of us that have been in it for a while kind of like the innovators more so than the early adopters if you look kind of like the adoption curve so now that we have those coming in there you know the chains are being pushed to their limits and things like that especially ethereum so we need this scaling to get to the next level and that's why i talk about scaling in layer 2 a lot on on the refuel and in my newsletter is it's critically important and is going to be the main narrative playing out over the next few years is who can scale who can't scale you know who's going to get the adoption who's going to get the market share i do

expect uh you know it to be kind of like as i've said before multi-chain world but i do expect that to be a lot a lot of the layer twos getting a lot of action a lot of traction there and maybe some other layer ones i mean technically the polygon pos chain is you know i guess like a side chain but it's technically also a kind of like layer one but then people debate against that i mean it's it gets all really messy when you kind of look at the whole ecosystem and how it may play out especially with the bridges and everything but it's going to be very very interesting to see this kind of battle play out and there's a few other layer two related stuff i wanted to talk about uh one here was from syntheman who kind of licked a little bit of alpha about

quenta's perpetual uh exchange or perpetual future sorry um product uh on layer two here on optimism the alpha is coming soon uh apparently so stay tuned but this was on the they posted this on the 23rd of august that it was coming soon there's about a week ago now which means that we may be seeing it go live any day uh now so those of you who are on optimism this would be just another product for you to kind of like play around with on there and i'm sure there's there's more coming uh kind of like over the coming weeks as i said optimism enabled there kind of like two-week uh uh sorry their their public white list and they said that people anyone who kind of like wanted to whitelist any app that wanted to whitelist could and they'd be deployed within two weeks and approved within two

weeks which you know i mean this is scalability spring as i saw someone talked about in in in my uh in the twitter comments today and it's funny because like i said arbitrary autumn but that's like autumn for the northern hemisphere scalability scalability spring is for like the southern hemisphere because we're going into spring soon um but uh yeah it's just kind of kind of quite funny just to kind of like see the the different kind of like narratives kind of floating around in the space right now but cool to see this little alpha leak here uh the next thing is that zk sync uh 2.0 uh uh have has gotten a developer update from the zk sync here so i think the most important piece here is that zk sync 2.0 has been delayed they're not going to launch in august like they thought like they originally announced

they would and i think i remember back i mean i love zk sync i love what they're doing and everything like that but i think i remember in back when they first announced they were going to launch this in august i was like that's really ambitious i think i've learned not to take any kind of like dates from the i guess like ethereum core and layer twos and stuff like that as gospel because you inevitably run into like these really hard thing uh really hard r d problems or kind of like uh infrastructure problems that you have to get ironed out before you can launch and that's what pretty much all of these kind of teams have already run into i mean optimism delayed their launch um from march to i guess like july with uni swap and then they're still kind of like having teething issues and things like

that because of the fact they didn't have that critical infrastructure in place they didn't have like the really good block explorer that they have now with optiscan uh they didn't have uh uh the inferiors and the alchemies of the world the graph and all that sort of supporting infrastructure around it and also their core code they announced the other day that um they're actually greatly improving the optimism network over the next three months so there's always that kind of stuff going on so i think the same thing played out with zk sync 2.0 here and in this kind of like post they detail that uh why they delayed uh you know how they got to this point but they've also uh talked about their test net rollout plan as well kind of a status status update too so the test net plan they're going to go in

in three phases they're going to have phase one which is called north star which in a couple of weeks they will start releasing the first version to a set of protocols so the first version of zk sync 2.0 which as i've described before is a evm compatible zk roll up essentially so different to what we're seeing with arbitrary optimism being optimistic roll ups um and then they go on to say here they want to work closely with the teams to facilitate rapid iterations of feedback and fixes minimizing bugs and all that good stuff and any interested people or teams can fill out this form which is linked in the medium post phase two is called spotlight search so after phase one is complete they the zk sync team would like to open it up to people that are willing to create content this can range from a tweet

thread to blog post to a full developer demo video the goal is to have a variety of helpful resources ready readily available when they fully open up their test net so if that's something you're interested in actually you definitely fill out this form and then phase three is called kindergarten which means the test net is open to everyone and then they go on to say that the main net they really want to have like a fair launch you know as far as launch as possible kind of like how arbitrary has done it with um getting as many apps uh enabled as possible before they went live on mainnet at least for like for end users so that's what they're kind of targeting here as well with zk sync so yeah i should just giving the blog post to read to kind of um go see why they're

delayed and there's and there's kind of a link to another technical blog post where they run through this as well uh that you can see here in separate posts but essentially i mean i didn't i wasn't surprised to see this at all but i that doesn't make me any less bullish on on zk sync whatever i think that it's still one of the top scaling solutions in this ecosystem right now um but it's just going to take a little bit longer for that to get to main net uh and speaking of layer twos a little cohen here had a really really great uh tweet where he says um i think fees won't improve immediately when uh these solutions go live like these layer two solutions go live like arbitrary and optimus i mean arbitrary and then optimism in more of a capacity and obviously the other ones like ck sync um

little comment goes on to say in the short term roll-ups like alba trim and optimism may even add to the congestion of the network and i mean this is because obviously they're users of ethereum block space as well and they're currently using it you can actually see on um on optiscan on and and kind of like uh rbscan there's links to the layer one batches and you can go there you can actually see how much fees they're paying i went to one of the batches and and and and arbitrary uh ended up paying like 500 for that transaction just to post their batches and their proofs to layer one um so they're definitely using a lot of ethereum block space and that actually led me down another kind of like rabbit hole where i was like i want to track this for like all the l2's i

want to see how much block space these l2's are using you know how many how much fees they're paying in eight ethan in dollars so i'm actually going to get a donated leaks dashboard built for this i've already reached out to someone and i'm gonna be working with them to do it because i think it's a really important metric to track so um but then yeah the uh little coin goes on to say things will start to improve when the majority of projects migrate to layer two and l1 will only be used as a sediment layer this is the end goal the one that i've been talking about you know for a long time on the refuel for a long time just generally like even before i started the daily way i've been talking about l1 being this settlement layer and l2 being where the end users are going to sit uh

and that's exactly what's going to happen this is going to be a kind of like transition period for that to happen i spoke about yesterday how coinbase is going to enable these scalability solutions they're going to be really big for i can't i kind of like getting people on board onto these things and you know in the meantime you i mean there's people a lot of people still using the ethereum network it's it actually on that note as well it's funny because the gas fees is something that people have complained about with ethereum for a long time it's not just a recent phenomenon if you think back if you were around back in 2017 um maybe you weren't around but like let me tell you i was the end of 2017 was cryptokitties mania it was the first major kind of like thing that launched onto ethereum that

really clogged the network obviously we had little spurts throughout the year because of the ico mania but generally that didn't last very long because the sales kind of like ended very very quickly but cryptokitties really kind of like um took off and and you know for at least i think the month of december and really uh clogged the network like the fees were quite high back then um you know not as high as they are today but they were quite high and back then it was the same narrative the same story oh ethereum's dead uh gas phase have killed ethereum ethereum can't scale this is ridiculous blah blah blah you know here's these alternative networks that can scale better and back then it was like the eos's of the world and some other random ones like neo and stuff like that and obviously eos and neo and

all that sort of stuff they they by the wayside now right they've just completely failed they didn't get any adoption really um no one's really building on it anymore and they're just like they're being forgotten about now we have like a new crop of these you know ethereum killers still playing on the same narrative that ethereum can't scale ethereum's gonna die the gas fees of killing it blah blah blah right we've heard all this before now that isn't to say that some of these other chains aren't gonna succeed right there are some out there that will gen will definitely get some kind of like legitimacy and also get like a developer ecosystem uh building out around them and they'll take trade-offs that maybe i won't maybe me and and maybe you guys won't agree with around decentralization and security but at the end of the day that is just like i guess

like uh orthogonal to my main point in that i think that it's just always funny to see whenever people are talking about ethereum being dead or ethereum's gas fees killing it or you know all these issues blah blah blah blah whatever you want to say it always coincides with eat going up in price like right now it has been going up in price for the last few hours it's just it's hilarious how it always happens but not not only the price uh thing but also kind of like the general narrative like you'll see if these uh uh kind of like layer twos get the adoption that we hope they will such like the generalized ones like arbitrary and stuff like that the narrative around especially if there's bridges to them from exchanges the narrative around ethereum and ethereum scaling is gonna change overnight you're gonna literally see

like especially on twitter people just like become more positive on ethereum again and ethereum scaling once they actually see this playing out but by that point the alpha's gone like if you're trying to play this as like an investment kind of point of view whether you're buying into some of the l2s and scalability tokens whether that be like i mean a lot of these l2s don't have tokens right now but something like i guess matic right that is kind of like a scalability play with polygons entire ecosystem um and that's what to say to google biomatic or anything like that i'm an advisor to polygon i don't want to kind of like um i say say that but i'm saying like if you're trying to invest in this space there's very few things you can invest in right now and obviously a major one being eath as well

so kind of like betting on like buying ethan and kind of like um betting on ethereum is betting on that layer to ecosystem too so you'll see the narrative i think change especially as the prices go up i mean it's always funny to see that people suddenly fall in love with these alternative layer ones when the price is going up for a little while and then once the price goes down they stop talking about it the perfect example of this not to single out any one project but the perfect example of this is over the last couple weeks there was a lot of hype and i don't even think it lasted two weeks there was a lot of hype around avalanche and their d5 rush thing where they had all these incentives being paid out and there's a lot of hype around all this avalanche projects well the the price of

the ave avax token has come down the price of of um the the kind of like i guess like defy equivalent tokens on on avalanche or whatever have come down a lot more they've just like absolutely crashed and that's because what ends up happening is that you have these people just going there as kind of like locusts they're going there to farm the rewards and that everyone's played this game before we played it in d5 summit we've seen it play out constantly over the last kind of year or so in that you go there you farm you dump the token then you bring your profits back to what you actually want to hold and for a lot of people that's ethan and btc to a lesser extent maybe but i think for a lot of people it's definitely eth and it's just funny to see it the same thing play out

we had other chains last night announced it's like phantom they didn't announce a liquidity mining program but they announced a um incentive program for developers right which is fine i mean every chain has this like that that's actually i think better than a liquidity mining program but uh you know still maybe those tokens end up getting dumped on the market anyway but any but but um separate to that there was also cello or cello however you say it they also announced a kind of like d5 rush thing i guess um where they have like a bunch of apps deployed with rewards i just think it is a short-sighted really bad strategy i just think it's always going to end up the same way we learned from defy summer that liquidity mining for d5 is not a long-term sustainable thing for most projects it actually ends

up destroying them or making it so that their communities get destroyed as well so it's just it's been wild to see that and that begs the question will these layer twos do their own liquidity mining programs once they have tokens i know polygon did it right with um their pos chain with matic incentives and they're still doing it and that's fine i think it's actually the best way to bootstrap growth in the short term but you have to have like a long-term sustainable plan you can't just have people go there um fund the rewards and then just bridge back to ethereum and just keep it on each and by eight with it or whatever i mean if you want that if that's the way that it's gonna happen then that's the way it's going to happen it's positive for for us holders but generally if you're trying to bootstrap

an ecosystem around your chain you need to do it in a much more sustainable way so i'm very glad that these layer twos haven't got tokens yet they will like let's be honest they all will have a token like i'm just gonna straight up say that um because the fact that i believe as i've said many times that everything's gonna have a token but i i don't think it's a bad thing i think that it can actually work really well to bootstrap growth and all that sort of stuff but i'm glad the layer twos are taking more of a i guess like a long-term approach rather than this kind of locust approach to things here but anyway i'm gonna i'm gonna move on from that for now uh polygon announced that they're going to be uh doing something called a bridges week this week so they're gonna be releasing

articles doing twitter space amas with some of the top daps and and um and more about like the bridges uh basically uh not just polygon related bridges but like bridges in general around i guess that connects and hop and all that sort of stuff so if you're interested in learning more about bridges definitely follow this um in the polygon ecosystem i think it's going to be great i'll definitely cover it as on the refill as well i'll link to it in the ether newsletter which is another newsletter that i run if you haven't subscribed to yet you can check that out as well uh but yeah i just thought i'd kind of kind of like highlight that there so and then finally i guess like uh this this falls into everything that i've been talking about this tweet from eric connor here uh where he put out this

tweet today where he said ethereum values decentralization first it's why many of us are here does it cause speed bumps along the way of course but this is a multi-decade play as the world realizes the value of decentralization ethereum's values will always give ethereum value which i think is actually an amazing quote like that really has been my thesis on ethereum for a long time um and obviously eric connor is my co-founder of ether where we're very good friends um and we talk about this stuff quite regularly but then he goes on to say in the second tweet a lot of you can laugh all you want and hop from one chain um from uh uh to the next for gains that's fine with me prophet maxi is fine but the core mission of ethereum will win there's zero doubt about it and i mean i

obviously believe this as well i believe ethereum is a multi-decade player i believe decentralization will win in the long term but in the short term there's just too much money to be made right like if you can do something like a like as i was just describing a liquidity mining program where you can pump up the value of your token if you're the team doing it and you can get some short to medium term adoption then you're going to do it and i think everyone's every kind of like chain is going to do it and they already pretty much are and doesn't just go for layer ones it goes for layer twos as well but the long-term multi-decade play that's just going to be much different to the short-term stuff that you're seeing now if you even look back to a couple years ago what the ecosystem looked like it

was completely different to what it is today and in a couple of years it's going to be completely different again and we're just going to have these wars going on lots of money is going to be made lots of money is going to be lost i remember reading a tweet back in the day that there's going to be a lot of people who make money betting on the wrong long term technology but the right short to medium term technology and to kind of like expand on that a little bit further you can make a lot of money betting on these things that just pump during the manias like what we're seeing right now you can basically invest in these kind of like early layer ones and then because the narrative is so strong and and kind of like the opportunity's so strong you can ride that wave up during the bull

markets but over time the value erodes right over the longer term you can see this with a lot of the first crop of ethereum killers from 2017 a lot of them or pretty much like all of them i think um have have performed very poorly against usd and even worse against eth so you got to just kind of like split it out the short term to medium to long term which is what i always do but i'm definitely mostly focused on the long term sometimes i'll do short to medium term things of course but in terms of like ethereum's adoption and having decentralization win over the long term uh you know a win in general is just like always a long term play to me so yeah i just thought this was a great tweet from from eric to highlight here um on to our next tweet out to the next

tweet from ryan sean adams who tweeted out this chart that comes from coinmetrix which shows ethereum issuance falling off a cliff and you know he says here see if you can spot when eip1559 was added i mean it's pretty obvious right we can see exactly when 1559 was added and we can see that it's net annual inflation went from 4.5 and has kind of like become varied now depending on how much ether that we're burning each day you can see that it pretty much immediately dropped to i guess like anywhere between two point five and three percent which is a pretty pretty great drop just from the fee burning alone and then lately with the extreme amount of kind of like fees that are being burned on the network it has dropped down to even below one percent on on some days and some days i think

it's gone negative uh which is quite crazy right when you really think about it but as we all know this isn't the end game of you know ethereum's monetary policy or like if kind of like annual inflation things like that we obviously expect eighth to be net deflationary once the merge goes through and that's coming i mean i i've gone through that a lot on the on the refill before so i'm not going to rehash it there but essentially this is a really cool chart so i guess thanks ryan for putting a spotlight on this one so something that came across someone damned this to me uh that i kind of like missed i think maybe maybe missed earlier today was hats finance here which is a project that i hadn't heard of before but they have raised 3.5 million dollars to build the future of

cyber security in web 3 as they call it here they're supported by um some of the the most well-known kind of investors in this space like such as lemniscap or the spartan group iosg and a bunch of others here um you can kind of like see the medium post here with the announcement and exactly what they are but they describe themselves as a decentralized cybersecurity incentive network governed by its community stakeholders of hackers projects and token holders and they're going to say hat's upcoming ppm protocol protection mining is a bug bounty vault that incentivizes community participation to secure protocols and farm hats tokens in the process the governance token of the hats protocol um so you know what's funny about this this is kind of now that i think about it there was a similar project to this that was came out in 2017 called oh man

i've lost the name now but i remember participating in its ico actually i'm just kind of like playing it as a speculative thing back then um i think it was called oh man i've lost the name but it was around back in 2017 maybe some of you know know what it was called back then um poli swarm maybe uh something like that i don't know maybe that i'm thinking thinking of something else but essentially that ended up failing but i don't think it failed because it was a bad idea and the idea was essentially around incentivizing people to kind of like do uh uh uh kind of like do these kind of bug bounties and and do more cyber security related stuff and basically creating like a decentralized network of white hat hackers and and kind of like security researchers and everything to um kind of

like uh i guess like move forward the r d on on cyber security and at the time in 2017 the reason i invested in the ico actually is because i thought it was a good idea because i was working in cyber security um in 2017 i was actually a shift worker um and doing as a cyber security analyst back then so uh i i saw the value in it immediately because i had kept me exposed to a lot of that stuff but a lot of you that haven't maybe you don't see the value in it but i do think that if done correctly it can work i think that the project in 2017 failed i think it was called polyswarm because of the fact that it was maybe just too early i think a lot of this stuff wasn't really kind of like um was relevant back then but i think it

may be relevant now especially with a lot of the default hacks that we've been seeing right like this stuff is needed more than ever and i think this is a great way to incentivize people to get more involved with cyber security kind of like find bugs in in code and stuff like that and do responsible disclosure and i guess like become a white hat and and and you know if they're a black hat or gray hat kind of like incentivize them to just be a white hat instead so yeah i mean i'll link this in the youtube description you can go check it out for a full breakdown of what this is but i'm excited that another kind of like team is actually kind of working on this and i think they're working on it at the right time i think 2017 was too early but now is definitely the right

time to be working on something like this so a bit of an alpha leak from scoopy triples here where he says to everyone in the alchemics community thank you for your support the summer months may have seemed quiet but we are nearly done with v2 which we're going to audit very shortly we also have some exciting partnerships we've been working on that will come to fruition soon so i mean if you haven't heard much about alcoholics this is exactly why they've been working on v2 and i think they're going to be making a lot more noise over the next few weeks so i just wanted to kind of highlight that there i'm sure a lot of you are still using alchemics whether that be the al-usd or al-eth products there um but yeah i'm excited to see what they've got up their sleeves for v2

and what kind of partnerships that they've been working on here so seb from zappa uh put out a kind of little teaser here today where he says the new collection page on zappa is coming soon and he also took the chance to showcase some of his wizards here so this seems to be just like a new nft collection page where you can kind of see all of your like i guess nfts and their net worth the floor price 24 hour volume number of holders basically all the information you get from openc but right in your zapper dashboard which i think is super exciting because i hate having to go to different things like i always go to like open c or some other kind of nft sites to track these sorts of things especially the floor price or like the volume and stuff like that so

i'd really love to see that just directly in my zappo dashboard which is exactly what what seems to be happening here so definitely looking forward to that uh so pop had an announcement today where they said for the first time ever over 200 000 accounts hold popes and they are so excited that they are doing a crazy crossover of an nft series a really sophisticated one because that's how we roll as i say keep waiting to learn what this is about so essentially what this is about is that they want to do a kind of like raffle here or a giveaway just for po-ap holders so to join this raffle you have to own one of the eligible po-apps the selection includes a diverse set including some unrelated to the art nft space which you can check here on the link here which will be linked in the

youtube description uh and then they go on to say everyone who has held a board ape a punji penguin or a stoner a stoner cat as of around august 28th can claim a special pull-up uh from po pop-up delivery that is eligible for the raffle as well the first prize will be a stoner cat or two if you have rt the first tweet of this thread before the draw second prize will be some rare pop-up swag um and then after the draw has finished with the win and the winners have been awarded the prizes uh the pipe uh team will start an auction with foundation for a one-of-one unique pieces created by emerging artists this is really cool i mean i love pop-up i've talked about them on the refill before a lot and i think that they're getting more and more involved with the nft and

art space i mean pops are nfts but like in terms of the arts art section of nfts and it's great to see them doing stuff like this i think the future of kind of like giveaways and raffles definitely is pop imagine having uh being able to do like a giveaway just for people who are like genesis depositors into uh the eth2 deposit contract that'd be really cool um you know i've done pipes for daily grade before i did one for 100 episodes of the the refuel 200 episodes is coming up so maybe i'll do another one there but imagine me being able to support like you know the early kind of viewers and and listeners of the the refuel um that have those pops as well so i think this there's a lot of kind of like use cases here there's definitely a lot more that can be done and it's great

that pop is leading the charge and kind of like showcasing this because i would love to see more apps do this within the ecosystem all right so finally we have mike three here who put out this tweet where he says i paid for access to this public toilet with eth just now it's all happening now the comments on this uh tweet were hilarious i mean i had to add my own where i said i guess eid really is a coin after all but there are a bunch of comments about like you know that's some expensive um i think people making like a gas fee comments of course and stuff like that so yeah obviously go give that a read if you're in for a laugh but this is funny like i i i mean i i think this is real i don't think it's photoshopped or anything like

that it doesn't doesn't seem to be um but uh yeah i mean you can kind of like pay with eth to use this public toilet now actually i don't know if this is real or not i'm gonna just be 50 50 on this if it is real really cool to see um if it's not then i've been kind of like psyops into covering this on the refill today but i guess like the main reason i wanted to cover is because i want you guys to go read all the all the replies because it's just absolutely hilarious i mean i love the kind of like crypto community's sense of humor it's always just really funny i mean everyone's just you know taking the piece of everyone else and kind of like posting but yeah definitely go check that out if you if you haven't yet but i'm gonna leave

it at that for today so thank you 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 the newsletter join the discord channel and i'll catch you all tomorrow thanks everyone