Bankless Daily Gwei Livestream

Transcript

at half the one min charts uh what's up anthony how's it going uh i'm good man i am so good actually like i am so i think i think it's finally like settling in that we're so close to the merge like it's no longer a kind of you know we're close but we're not close it's a we have an actual day and like it's so close it's like three weeks away or something and i've been talking about it every bloody day almost for like the last however long and i'm just like oh i'm not crazy we're actually gonna merge and yeah i mean i feel similar to how i felt with one five five nine right where we spoke about it for so long we finally got it but that's like child's play compared to the merge yeah like i think

people don't realize like i was hyped about that we were all hyped about that but it's like completely different compared to them but the emoji is like the thing i think proof of stake is like the major reason most of us got into ethereum i think yeah yeah that definitely significantly it's like a new innovation that made us all say like aha uh okay what would you ascribe the chances of the merge going just like as well as we want it to uh pretty high up there i mean if i'm basing it on the on the test nets the test nets like didn't go [Music] perfectly obviously but that's because they're test nets i would say like 95 plus percent chance it's going to go as we expect but people have different

expectations because like there could be an instance where 10 percent of the network or 15 of the network just is offline right at time of the merge like validators are just offline because they misconfigured or they've done something that they shouldn't have done and they're not on the network anymore but like they're going to very quickly fix that because there's real money on the line for them to to be offline in that scenario so and that's not even a merge failure like the chain would keep ticking along we'd still keep finalizing so it doesn't actually matter right um but i think that if that happens if it saves like 10 percent of the network goes offline instantly there's going to be fud everywhere on twitter it's oh my god like the merge fast no matter what yeah if the chain doesn't split and then

everything becomes just stabilized like we lose we drop off like 20 of the network but then we get it almost all of it back within 48 hours and there's no chain split i'll call that like a complete success right and i i'm also i mean i would even call it i would even call it a success even if we like 20 of the network went offline because i think i mean i go as far as saying if as long as we have more than 67 of the network online i consider that a success because that's the the finalization threshold obviously we want much more than that to be online and i don't i mean not even the like the worst test that we had was was girly i think in terms of participation falling off but that fixed itself within two hours and we'll back up to

yeah we'll back up to like over 90 and that's on a test net like on main net even if we get a large participation drop off it's going to get fixed extremely quickly i'm pretty sure like everyone that's running a validator is going to be monitoring it or nursing it during the merge transition to make sure everything goes well and everyone wants to see the pandas too right so yeah i'm not i'm not concerned and we've tested it so much man like i don't think people realize how many like shadow forks and test nets and like short-lived tests that we've done so much you you can only test so much we know what we know what works the the issues normally stem from that misconfiguration which means that some validators go offline that's that's the biggest issue

and obviously sometimes clients have trouble talking to each other because there's like nine clients now like five on the consensus layer side four on the execution layer side but that's nuance and together doesn't like nuance twitter just wants did it go successful yes okay the reason why i asked it for a percentage and like me and ryan gave the same percentages on the weekly roll up like 95 plus like probability of like complete success and then did you see eric walls um uh pull tweet not too long ago it was like uh a for complete success b for chain split or something bad or unexpected or c postpone and not doing it and if you add b and c together the two bad outcomes you get something like

33 percent of people said that outcome and then like 60 of uh 50 of people said as expected and the rest were results right and so like me you ryan the people who pay attention to these things also the permabulls are like 95 probability it's gonna work and then like if you take eric wahl's like twitter following as like maybe a more average he's followed by like a general like wide cohort of people the general crypto twitter is pricing in uh like 50 success and like 33 like something bad happens or it gets postponed and so like buy that not price it right yeah yeah yeah no it's

if we're right like the the the priced in thing is always really funny to me because i don't know if people realize just how many people think that the merge is actually still not happening like i know it's silly to say but because it has been like proof of stake ethereum has been quote unquote delayed so many times right because it has been a very long time coming because it has been spoken about for a very long time anyone who's not paying attention to ethereum finds it very hard to believe that this is it this is actually going to happen this time that's that's alpha in of itself there's also people who now believe that ethereum's transition to proof of stake is like it's death sentence because of the censorship concerns and things like

that right and they're just now learning about the fact that blockchains can censor you or miners and validates can sense you right when i mean we've known about this for a very long time and they also haven't paid attention to to like ethereum and i've seen a lot of people say oh well the beacon chain only has a deposit withdrawal queue just to pump the price of of eighth they didn't even know about the queue so like i i think people who pay attention to ethereum just don't realize how bad that information asymmetry is and that's all pure alpha like if if the merge was was was priced in like fully priced in then uh you would assume that everyone knew every single aspect of the merge like every single bull bull kind of property of the merge

which is not true at all they don't even like it's not even it's kind of funny when you think about it because they're not even aware of like the fact or they don't a lot of them don't even believe it's going to happen there's still that misconception that there's going to be all the stakes either unlocking at the merge right which is just prevent that actually prevents people from from buying right like because they're like oh i don't want to get dumped on and then when they realize post merge that nothing's unlocking nothing's being done thinking back what the hell right and then it's also a day risking thing too i think for big money they're like they don't want to get in that's real yeah yeah it's definitely real and that's fine that's actually totally free realize that yeah realizing like rational yes yeah exactly so

it's kind of just funny when you think about all of it together and all the moving parts to it and yeah i mean and also on top of that like even it's funny i was thinking back to the um podcast the first podcast you guys did with hal press uh and how he made me even more bullish even though i had been writing about ethereum and being bullish on ethereum and been investing my whole life in it for like years and i never thought about it the way he did so if he can make me more bullish right like then this means there's plenty of people out there who are still not bullish exactly yeah and just on like that a from ac uh information asymmetry uh kp singh in the chat says i told my investor friends that the merge is happening they're like yeah it's been

happening for the last four years and then they say no no it's actually happening uh and like that's gotta be like the average case of the average crypto person who doesn't consume like specialized ethereum media i would say like it's like the average crypto person is just like proof of sake has always been happening that's always been happening since like 2015. it's never actually happening uh and so like the fact that it's actually going through this time and actually scheduled with a ttt date uh yeah like that that's actually fair enough it's like it's the anomaly that that is true uh but i mean this is why it pays to stick around and pay attention and look under the hood of things like you get to see this coming from a mile away yeah yeah and and as i said i don't

necessarily blame these people if they've been hearing about it for so long and it hasn't happened because if you're not paying attention to it then to you it's kind of like something you've heard a million times it hasn't happened it's like the boy who cried wolf so so to speak right so when it does happen i think that's going to really kick a lot of people and be like wow they actually did it right they actually became a proof-of-stake aetherium you know there are people out there who don't even know that proof of stake is live as a separate chain right which is just it's just funny when you think about that as well but yeah i i think i don't blame people necessarily for for still being in disbelief but again that's a source of kind of like not priced in alpha i get so to speak

right yeah yeah uh in our so for the people watching on the youtube if you're in the daily gray yeah discord channel or the bankless discord channel we actually have a um uh people in the zoom with us just hanging out and so uh christina says in the in the zoom chat well now bitcoiners admit that the merge will happen but they keep to they keep on claiming that the four mega stakers controlling the network crack and binance coinbase and lido will force censoring transactions by governance right and so like the you know the nice thing about bitcoiners is that like their fund is at least something to talk about and like even though like the fud is like usually almost overblown like they are forcing the conversation and like yeah

like people like you me all these like core developers have like thought about like yeah what about censorship and we've thought about this for years now and it's been part of like the development roadmap and then the bitcoiners are like just raising the questions thinking that it's like real fud but like it does allow us to like have these conversations that force the conversations into the mainstream that all like these people that came in the last year or two years that haven't been a part of these conversations like we haven't had a significant censorship conversation since like the last bear market when we were bored so we would talk about anything and so i will give the big coiners credit like thank you for elevating this conversation and like okay now pinella people top of mind if we were just like if we made like a

random censorship episode on bankless it wouldn't have landed like it would have landed when we are doing the one that we're coming out on monday with justin drake right like and so like now people are like oh ethereum sensorable and so like okay well no let's let's go make it let's jake drake come on like we need some help uh and so he comes in and now we make a censorship episode and everyone's gonna listen to it and everyone's gonna like oh no there's these things called uh proposer builder separation there's these things called like censorship resistant lists like there's all these mechanisms that uh people aren't aware of that think that ethereum is just like naive to but no we've been thinking about this for a while we're just thinking about a hundred other things and now now because of the bitcoiner fight it's like time to

talk about this yeah it's it's interesting because i don't ever really agree with how bitcoin is framed these sorts of stuff because obviously they're trying to frame it as like this existential negative for ethereum that's going to break the ethereum network and you know they will write all along about everything they they always love to do that but you're right they they do end up forcing the conversation if only for us to kind of like correct the fud that as you said we've already had discussions about right like they do force us to just re uh kind of like instate everything and reiterate our our beliefs and now um and our knowledge to the wild and it actually helps us so i don't know if they realize that they're doing that because they're definitely not trying to help ethereum they're definitely trying

to you know actually fight ethereum and and yeah they want ethereum to suffer damage from it um but yeah i i've never i mean i have from time to time but like i don't really tend to think about it as a positive but if you think about it like that you can you can kind of come to the conclusion that them forcing the conversation is a positive is probably like a overall positive because there are negatives thought the negatives are the fact that there's so much noise like it's just insane how many people just don't realize that censorship is possible no matter what network it is no matter what the proof of work proof of stake um because these networks are censorship resistant not censorship proof like there's a key terminology there and i don't think even bitcoin has it ever even claimed that bitcoin is censorship

proof that's how like important it is to be uh accurate with terminology because censorship resistance is is at the heart of it but at the end of the day like it's it's i mean even in proof of stake it's extremely hard to punish for censorship if not impossible uh without a social intervention right like because there's no objective way for the protocol to see that censorship is happening especially if for example you wanted to punish validators for not including transactions in blocks the protocol doesn't say that at all like humans have to say that humans have to crawl for that and then average it out but you you can't see the protocol can objectively see if there's censorship because of irregular uh transaction ordering and

i mean i guess we're we might be splitting hairs because like what you're saying is like the theorem protocol doesn't care what transactions get included in it but like part of this like drink episode that we did is like yeah you can actually objectively prove when there is maybe it's from the social layer though you can objectively prove when there is uh transaction censoring because like higher gas fee transactions are ignored yeah yeah exactly you have to do that from the social layer that's what i'm saying like you can do it objectively but the protocol itself needs the product right and the perspective of the protocol doesn't know yeah yeah and maybe we maybe we figure it out in the in the future maybe there are technology technology um solutions to this but right now there isn't and the thing is is that it's even worse under

proof of work because there's no way to surgically punish censoring uh valid and minors uh and and the thing is if you're going to punish them then the only way to do it is to change the hashing algorithm which punishes everyone punishes even the honest minors which honestly like this has been talked about for a very long time i remember vlad zamfir who a lot of people won't even know who he is because he hasn't been very active before so long now yeah yeah but he was one of the principal architects of early proof of stake ethereum uh and it was pretty deep in ethereum and was very well known back in the day but he has a famous quote where he said that you know if there is an attack on the network under proof of stake we burn your asic farm down

basically like uh whereas in private work bitcoin for example if you burn the asic farm down you don't just burn one you burn all of them right because you have to change the hashing hashing out the algorithm right so you shoot your entire army in the in the head and then go and go start an army from scratch yes exactly so that to me has always been a big draw or proof of stake that that surgical punishment for people who or validators that we consider to be attacking the network and it's not just a subjective thing it can also be done in protocol where if a validator is double signing surround voting you know doing things that they shouldn't be doing they get penalized for that and and no and other people don't get penalized for that so i

think that it's very important when considering the trade-offs of proof-of-work and proof-of-stake and and things around censorship like what tools we actually have because i think objectively we have better tools and proof-of-stake to recover from this sorts of stuff that proof of work does um even though proof of stake has its own trade-offs it's not perfect like it's it's it's got its own trade-offs compared to proof of work there is uh there's a big benefit that we get for those trade-offs at the end of the day yeah there's two directions i want to go in there's one where like yeah bitcoin has this problem with like removing its own sensor sensoring but also like it's probably not going to be censored in the first place because it's just not that useful uh and so like okay well since i've already opened up that door the the

argument here is that like uh bitcoin has problems just like you said with like if there are miners doing the censoring there's no way to selectively target those miners and kick them out of the network because all asics are the same the bitcoin protocol can't determine who's doing censoring it just adds a block to the blockchain but then the bitcoin argument is that like um well yeah but like nation states are never gonna like ban bitcoin because it's like it's just it's just 21 million units right like there's no tumbler like they they the ofac did ban a bitcoin tumbler but it was like a centralized app layer thing that was like nothing to do with the protocol and so like the bitcoin argument is like yeah like bitcoin is so like innocuous innocuous um

close enough yeah that like it's just gonna like slip into the financial system like slip under the federal reserve and it's like there's no stopping it because like you know there's no like legal precedent for and uh and so like sweet like it gets it gets adoption that way but also like the only way you get that is from being impotent like not like you don't like sure i guess you don't have that problem but you don't have defy like the reason why ethereum is getting targeted is because it has unstoppable applications and like the even nick carter said this on one of his podcasts is that like ethereum is like the new like spearhead of like the cypherpunk movement because it provably by the fact that ofac is

going after tornado cash the unstoppable application uh and so like there's something there like if the nation state is offended you know you're on the right track like you're going in the right direction because you're doing things that the nation k state uh doesn't like uh and so like there's probably like a balance here and um john chobino chauvino from delphi digital made this like nice uh xy axis axis whereas like the vertical axis is um how useful you are and then the uh why the horizontal axis is like how easy uh to regulate you are or how worth regulating you are like the more utility you have the more like reasons you have to be regulated and then there's like the another axis of the z-axis which is

how regulatable are you and like the idea is that you're balancing like trying to optimize for becoming the most useful possible the most unregulatable possible but also the thing most worth regulating and if you can optimize for those three things and still remain censorship resistant like you've you've maxed out the you've maxed out the spectrum and like that's where i see ethereum is and this whole like again this episode with justin drake will explain how we actually bake in censorship resistance complete censorship resistance all the way down to like both the the non-protocol level the protocol stack above it but then all the protocol itself and so like in my mind it's like we're maximizing utility maximizing how unregulatable we are and also by proxy

of maximizing utility we are also like saying we're super duper like the nation state wants to regulate you implying that like you're on the right track here yeah yeah and i think on that line of of uh of argument as well it's all trade-offs like you could argue that ethereum has a larger censorship attack surface because you can do more on ethereum's base layer than you can on bitcoin's base layer and then bitcoiners will argue and say well that's an that's why we don't have anything on the base layer we just have like btc on the base layer and then we do everything else at layer two it's like okay but you're extremely limited by doing that like you can't even build expressive layer twos on bitcoin because of the choice of keeping bitcoin layer one limited so it

but whereas you can barely build lightning you'll work on it exactly exactly so it's always just trade-offs and it's what you optimize for and as you said there's kind of like a goldilocks zone um i guess that's what you're probably alluding to with that with that um y-axis x-axis stuff but there is kind of like a gold deluxe zone that you want to be in where you have the maximum utility you have a way to maintain censorship resistance decentralization credible neutrality and you also have uh have kind of like people coming after you nation states coming after you and things like that so yeah i mean i think ethereum isn't there today i think ethereum will be there in the future and as you said you'll discuss the solutions on the podcast with justin drake i'm sure he discussed all the one things that i would bring up

anyway um but when we get to that point and they actually like work as advertised obviously things are good in theory we'll see how they work in practice then ethereum could be considered like fitting in that goldilocks zone but i think ethereum is the closest out of anything right now because the only other blockchain that i consider to actually be truly decentralized is and and it can't do what ethereum can do so if here really has no competition here right now if there was another smart contract chain that was similar to ethereum then yes but nothing even comes close like people will go will go on about ethereum and like how the stakes centralization within different exchanges and taking providers and all that sort of stuff but the other change other proof of stake

chains they're all deep depots right like pretty much a different flavor of deposit they would be so so easy to censor by accident when it gets spammed and it has to go down yeah yeah yeah yeah so like this is what i mean it's kind of funny where ethereum is just proving the fact that like uh it's actually sensitive resistant with this sort of stuff just because some miners and validators may drop transactions doesn't really mean anything like i think you know i saw some math the other day post merge 90 of validators can be censoring your transactions and if only 10 are accepting it you'll still get your transaction into a block within like 20 or 30 blocks or something and blocks are 12 seconds so it's like a few minutes so even if the majority of the

network is censoring you for whatever reason you're still going to be able to get your transaction in and i did some some kind of like uh some head theory on this on on on the refill the other day i don't know if this is accurate but it makes sense i think that even if every single validator on the network is censoring you and your own validator is the only one not censoring you you would still only have to wait until you were proposing a block you'd put your transaction into that block which may take months right it'd still take a lot but in theory i believe you should still be able to get your transaction in um but i'm not 100 on that but still it's kind of like that checks out like the worst case scenario is that you you have to have 16 ether you would spin

up and so like you have to that's the minimum threshold to spin up a rocket pool node and then you'd have to wait like a month of time and like maybe i mean it's it's kind of it's random it's not random on average very often yeah on average it's going to take a long ass time but like yeah the fact that like that is the absolute like doomsday worst case scenario and like there's still nothing stopping you from writing to ethereum under the end of that is like still pretty good which i mean actually like that kind of sounds pretty terrible it's like wait i need 16 it's terrible and but like then if the degree of severity that we would have to get to that point is insane but but if 99 if like every single validator is is censoring you then it stands to reason that they would also be

censoring not just at the block proposed level but at the attestation level as well which means that they wouldn't attest to your block and it would probably just re-org right um because if they're not attesting to your block they're attesting to another one and the chain logically i think would re-org around you and your block would just get orphaned i think yeah i think that's how it works yeah well we don't want that yeah um no no okay so there's another question and again for all the youtube people that are watching if you're in the bank list uh inner circle or the daily grade discord there's a link to the zoom where uh we have some people hanging out so yash asks uh i agree that retail is ignorant and unaware we're talking about back to the merge stuff but what about institutions uh i i am sure that they

have access to all this info yet the price is where it is do you think that they are equally unaware as well like my quick answer here is that like well institutions are just made up of people uh and so like the only real difference is that like an institution might be paid more like and have more resources to go do more research but still at the end of the day just like you they're still made up of people at the end of the day so like they have the more resources to go and research stuff but uh what are what are your thoughts anthony i have a very short answer to this look at all the institutions that blew up from the terror collapse even though for years people knew that terror was going to collapse that's that you did like i don't think they did my point is

what do you mean i don't think they did know it was going to collapse but okay okay so there's knowing as in like the information is available to you may have read it and then there's knowing as in taking the information on board understanding it processing it and actually coming to a conclusion from it i can tell someone hey the issuance reduction post merge is going to be 80 85 percent whatever it is right now uh and that means that there and and it's technically gonna be zero for six to twelve months post merge that means nothing to people in a vacuum right then you have to discuss everything that goes along with that basically saying well it changes as how press likes to put it it changes the structural flows of ether as an asset it makes each trade lighter and then you would have to define what tread

lighter means it depends who you're talking to but i think when people think about knowledge they think that you can just read something in and automatically that's that's your knowledge now you understand it you understand the implications of it but i don't think that's how it works and it doesn't matter if it's an institution or an individual uh i think it's as you said institutions are made up of individuals so if they're not focusing on it if they're not understanding it then they're not going to make the trade and also as i said before the they're more um prone to ignoring not ignoring something but like waiting something because of the risk right they don't want to get into a something which could potentially lose the money because of the fact that they are managing other people's money so there's there's a massive difference between me and you buying ether and an

institution buying eighth for the merge right like we're happy to take the risk a lot of institutions are not happy to take that risk yeah and there's been other people that are like money managers that i know personally uh that like command tens if not hundreds of millions of dollars on crypto twitter uh and then also just like other money managers listen to these same people and they're like on twitter asking questions that kind of like imply that like you don't really know anything about the merge and uh all the the actual facts of like the the fundamentals so i wouldn't really give institutions like too much credit beyond like the individual individuals of crypto twitter i'd say yeah yeah um it's it's funny whenever i talk to someone or see someone talking

in a thread and they get the most basic things wrong about ethereum and you think that they're supposed to like be smart and know all this sort of stuff it just if you spend all your time in ethereum you get bogged down you just start assuming that everyone is on your level uh when in reality most people are not because it's very hard to keep up with what's happening in ethereum and these people don't have the time a lot of the time right and they'll just always like god like people like because i i mean you and i are like in front of our computers for like 12 16 hours of [ __ ] [ __ ] day uh and yeah my job is to like research uh for stuff ahead for podcasts and so like i have the privilege of being like oh i get to like

read stuff about ethereum for like 16 hours a day and then i get frustrated that like other people don't understand what the merge is i'm like oh yeah wait a second i should be a little bit more like sympathetic here yeah yeah i and i i think i mean it's just natural for us to kind of fall into that i mean i you know even with me doing my daily show i literally have to keep up with everything bleeding edge i mean i enjoy it of course but you know it it like it's kind of like the the way i think about it is if i was to go into another ecosystem that wasn't ethereum i'd probably be very noob in the naked system i have no idea what's going on yeah no idea like that's the thing so that's that's the way i kind of

view it and i would i wouldn't really understand how polka dot works yeah yeah well that's what i'm saying like you don't know what's going on like these these teams aren't not doing anything um it's just that i mean for one reason another we don't keep up with them for me it's just i don't have time to keep up with it yeah and a lot of the times they're not really building anything that i think really interests me too much there are things here and there but again like it's the same as someone being in the you know polka dot ecosystem and not paying attention to ethereum it's just it's a time thing as well like you can't pay attention to everything you have to pick your battles yeah totally since we're about 30 minutes through this uh thanks everyone for tuning in to uh this live stream anthony and i do

this every now and then uh if you're not familiar with anthony that would be crazy but if that's you i've just put a youtube link to his daily way youtube account where he does a video every single day about uh ethereum and what's going on in the milieu of crypto twitter and also writes every single day on his newsletter so you can go check him out there more technical more fringe nuanced content than what we do at bankless because he does it every single day and it's strictly about the ethereum ecosystem so i frequently use the daily gray to stay up to date with some of the more frontier level stuff of the ethereum ecosystem uh what should we talk about next i think christina's got uh another question for us now zoom chats uh going back to the uh decentralization slash

scalability of change conversation what about cosmos is it a real competitor to ethereum so i've been talking to two cosmos people because we're actually doing a cosmos episode uh after like this whole merge phase uh gets over um imagine doing a cosmos episode like right during the middle of the merch but like they're having uh sunny and zacky on to like explain like the cosmos vision and like uh i think both of them yeah agree that like the end state of cosmos and the end vision of ethereum are like the same things and so that like and so cosmos gets a lot of credit for like this modular app like uh app chain idea where like you can spin up your own uh blockchain and not be beholden to like the ethereum layer one and you get like a little bit more sovereignty and

freedom but like the conclusion is still like shared security at the end of the day and like these are the cosmos ogs or like yeah the ethereum conclusion and the cosmos conclusion they start they start from the same spot they diverge and how they get there but then they conclude at the same spot and so at that point you really just want to like take who's in the lead and the theory like it's it's a function of like what's harder shared security or spinning up a bunch of app chains uh and i think the ethereum model of like putting monetary premium into your asset is way harder than that's the hardest thing to do is put monetary premium into your asset everything else is not as hard and so i mean is it a real competitor to

ethereum i would say it's the most real competitor that's out there is it a real competition i still don't think so but i will give cosmos like yeah it's like the greatest number two to ethereum that exists i'd say i don't know i think on a long enough time frame in crypto most layer 1 chains are like gonna fail and the ones that succeed are going to end up looking very similar to each other i think and by succeed i mean like a chain that succeeds to you know be credibly decentralized and be secure and actually have developers and things like that and i mean you're right the cosmos vision i mean they have i think i think where they fundamentally differ from ethereum is that sovereignty over like

uh the chain right they believe that the app chains should be able to be sovereign and have a choice of whether they plug into the kind of cosmos hub or not right for that shared security which is a fine thing to believe but i personally don't think that vision is the correct one i don't think that part is the correct one i strongly believe that the layer two the roll-up centric road map is better for a number of different reasons and as you said like there's also the monetary side of things like the atom token it's not even trying to be money right it's not even it's not even exactly it's not even trying to accrue value so like that is i mean to me that's the most important thing at the end of the day not just because you know bags go up and your and profits go up but that's

got nothing to do with that it's got to do with the fact that it all comes back to the asset at the end of the day the asset is what you use to secure the chain right it's what you use to have as money within the ecosystem people use as money it you need a truly decentralized money you can't just rely on centralized stable coins as we've seen you know they're very uh very hastily use their um hastily use their blacklist function when required and decentralized stable coins are very hard to build especially at scale we've seen that play out too so you need a truly decentralized asset of the at the heart of your ecosystem and you need it to actually accrue a monetary value monetary premium people you want people to hold it and you want that to be like a feedback loop in your ecosystem so i

think that's like as much as i think eventually cosmos will probably look like ethereum in that with the shared security that they're doing with the hub and then you have like these spokes being the app chains i don't understand why an app chain would want to plug in for shared security if they're trying to be sovereign um you know it's it's kind of it it just it seems like a bit of a roundabout way to just get to the roll-up-centric roadmap in my mind it seems like a long way around like if we're taking the short path they're taking the long path right right and if you do the path of making your asset money later like the cool the reason why ethereum one of the one big reason why ethereum grew so much more than cosmos is like ether like you get to tell the story of ether like

people get like people like buying stuff in crypto it seems to be like the thing that we do the most is we buy and discuss tokens and so like if you get a lot of focal point uh focal attention on like your asset your l1 asset then you just there's so many like positive second order consequences of that um exactly what else yeah that's it no i i mean i just i i think that like people will often look at the the tokens and people talking about driving values of the tokens and all they'll think is oh you're just trying to pump your bags when really it's it's it's not about that it's it's literally about all the things that that i outline about that and yeah but the thing is is that like we're harnessing like it's for a reason

speculation yes yeah yeah well that's it we're harnessing the speculation within crypto that already exists that is going to continue to exist and is the only product market fit that we've found so far for any of the stuff that we're building um we're harnessing that for the good of the ecosystem and i think that when you're when you have like an aversion to that and you set that culture it becomes very very hard to tack it on later like you can't just i mean ethereum arguably did it but it did it at like a very opportune time because i don't think ethereum was considered to be like a monetary asset until 2017 until the ico mania before then it was like a very hush-hush about it people were like no no we don't talk about ether it's like a money as like a money right it's gas exactly it's just used to

pay fees on the network power yes yeah exactly um and then the ico boom happened like a couple years after the network went live and we had the the rest is history 2018 2019 we cemented i think eighth as a as a as an asset or we memed it and then 2020 each went up and it just like went on from there so yeah it just it's gonna become harder and harder because you not only have like these other layer ones like cosmos you have them competing with all the other layer ones now right like and there's only so many monies that can exist like only btc and eight have been able to accrue that monetary premium because uh they're the only ones that are like truly decentralized the only ones who have optimized for it all the

other chains they're not even trying they're actually not even trying to optimize for it and and if they think they can do that later they're in for a shot because i don't think can happen later yeah yeah yeah yeah you have to do it sooner rather than later because that's how you keep things decentralized um well oh yeah the thing i was gonna say earlier is that like the cosmos like attitude is that like there's all this mev on the ethereum chains and like uniswap compound they pay so much of their they leak so much value to mev people and and so like they pay a lot of like tax to ether uh and then and and so like that's bad because like ether is like this extractive rent seeking entity that's like seeking all this value out of these apps and that's a bug i'm like sure it's

a fair perspective to have and it's a bug from that perspective but like as soon as you buy ether it turns into a feature like just just buy ether and the problem goes away um yeah and like also you also have the best of both worlds too where you get the mev on the layer one and that goes to ether but you have the app specific chains on like zk roll up layer threes and also with four eight four four you reduce a lot of the layer two's payment towards like ether the asset and so ethereum gets all of the mev and puts it into of the asset on the layer one it does it a lot less on the layer two and it basically does it at a zero level on the layer three so like pic pick where you want to inject

yourself in the ethereum ecosystem depending on like how much mev you were willing to pay to the ethereum layer one well that's it and and if they're if they're making the argument that there should be like a sovereign uni chain well i mean why not just do a layer 2 uni chain like you can get that you can still have the mev uh come into uni because you have like i don't know staking the uni token to capture fee revenue mev on the layer 2 uni chain you wouldn't need a an app chain or sovereign app chain for that i'm just i'm personally not convinced that sovereignty is worth the trade-offs of of security like because you lose so much security going for sovereignty and i don't see where the major benefits are like you get some more control over your layout but at the end of the day as a

layer 2 you have total control over the protocol as well if you want to keep it centralized at the beginning you can do that all you have to do is pay ethereum a little bit in each fees for its block space right you don't even have to pay that much post bank sharing you'll be paying pennies you won't even you would you won't be paying hardly anything to the chain so i don't understand where this massive benefit of sovereignty thesis comes from really i i really do think that a roll-up gives you everything uh that you need when it when it comes to being an app chain so to speak maybe not today though because look to be honest today the roll-ups aren't decentralized and there's no way for someone to just build their own app chain using a decentralized set of of

roll-up tools there will be in the future right like i'm not talking about today i'm talking about that it is possible it's just that we're not there right now and that's partly why dydx went from i think you know their um roll up to the cosmos chain because they want to decentralize but they can't right now because stockwere technology is not ready for that but it will be in the future it's just a matter of timing yeah um uh moving on to another question yash says what are your takes or counter arguments on the recent is the merge over hyped article on bank list did you read that one anthony i haven't yet i saw it in my inbox but i haven't gotten to it yet no all right let me uh let me speed run you through it and i'll let you give your takes uh narrative one is

it the one by jordy yes yeah the one by george okay yeah uh let's see uh narrative number one buy the rumor buy the news eth priced to spiral up into a super cycle so this is like the arthur hayes like it's reflexive uh and so like the price goes up causes price to go up uh let's see what are the main head points um uh i think i think he's just like a it's a buy the rumor sell the news kind of thing narrative number two the triple happening drives ethan to a deflationary supply crisis uh but then he basically says like uh well the the transaction fees are super low now uh and so because the transaction fees have gone down from the bull market like it's actually not

going to be all that big of a deal and then the third one why would there be a deflationary crisis to begin with does he understand that like there's still inflation coming to the network and eighth is divisible by like 18 yeah the crisis word i think i think isn't isn't right like he's saying that the narrative is that the triple happening will drive ethan to like this deflationary it's going to be great oh yeah like supply crisis yeah that's he shouldn't have written like that he said but he's like here's the narrative everyone's super bullish because it's going deflationary uh but then his counter argument says like well actually we're actually not gonna be deflationary because the gas fees aren't that high and so like that's the argument we actually are for six to twelve months technically because no new supply comes to market uh and then

narrative number three stakes each will be a yield seeker sensation but then he's saying again like the yield's not gonna be that high uh if like 20 million ether gets stakes like the actual real yield is gonna be like three or four um you wanna take yourself we have 20 million eighth locked up yeah that's right like yeah you're missing the part where like a bunch of ether gets locked up from the seconds yes the yield so the thing is is that the yield is eighth denominated right it is not usd denominator so if the yield is three percent but the eighth price goes up 10x because all these eight is getting staked and like it's just like it doesn't matter that your yield is only three percent right um yeah yeah so i i think i get the line of reasoning that he's trying to use here

but i feel like he's he might be grasping at straws a little bit um yeah trying to find counter arguments because i've thought about these as well and there's always a counterbalance to it as i just said like if more eath gets staked that's more east being locked up that means there's more demand for each pushes the price yes exactly and it's a balancing act like as the yield goes down so the yield will be at a level where people are comfortable staking for that yield right if the yield goes to too low people will withdraw their stake then the yield will go up right so it's it's not like that's a locked-in thing and because it's not a i mean quote-unquote real yield right where it's not like people paying you the yield the protocol is paying you the eat it's inflationary right it's it's

regulated by the protocol it's not regulated by uh the the kind of like demand for speculative kind of like activity right demand for borrowing and all and leverage and that sort of stuff it's regulated in protocol by the protocol rules and ether nominated so yeah i i just think it's a balanced system i don't think that's a that's a bear case that the yield is going to go down like peop some people are going to stake no matter what the yield is because they just want to stack as much eat as possible because they believe it is going to go up a lot more than what it is um and you know as the dollar value goes up like if people are using staking as a passive income source it's because it's either nominated and usd goes the price of each goes up it's still going to be worth it for them

right yeah yeah yeah um uh so the argument i'll take the gas fees one where he uh let's see uh what was he saying was like the bull case uh you know in the top of the bull market we were like oh my god if we merged right now e field would be like 15 and that's when like gas fees were like 300 plus um yeah and so i think he really builds off of his uh off of that like kind of paradigm and it's like well it's actually not going to be that bullish but we have we've priced that in at least on bank list we've been saying like the new number is something like six percent with once you get mev i think we may maybe have said something as high as 7.2 percent i think if we merge right now

it's like basically four percent yield right now and then if we merge right now it would be something like 5.5 uh with mev um and so like we've been saying that these numbers have come down and so like i think he was going back to a period in history where it was like suit the gas states were super high um and so like so if we're call it like with the issuance even though we can't sell at the moment with the issuance like the introduction reduction will go down to 0.4 a little bit of above 0.4 per year and then you add the very small amount of burn that we have it go it gets cut by 50 down to 0.2 percent so like even with a small burn you cut issuance by 50 because we're already so close to zero but like

if we're if he's if the bearish case is like we're actually not deflationary net deflationary and we're actually still inflationary and that's bearish like we'll be at point two percent bitcoin one 1.9 percent solana 6.7 avalanche 5.4 percent dogecoin 3.6 percent uh cardano coming in at 1.6 percent uh uh i mean and then we go down further down the list of coins that don't matter like litecoin and eos but it's also it's also the the okay so so this is what get well it frustrates me it's all reflexive the entire thing is reflexive once the bull market comes back once it starts going up properly again the fees are going to go up again right we're going to be burning it we're going to be

post-merged we're going to be deflationary during those periods it's going to all feed off of each other narrative reflexivity price reflectivity and it's just going to go absolutely nuts right eath as an asset has lots of natural demand and and we're not just talking about a supply crunch we're talking about a supply crunch into natural demand right so immediately post merge the yields are going to go up because the tips are going to go to stakers and the nav is going to go to stakers then what's going to happen is people are going to see the yield go up to maybe five or six percent they're going to be like wow i want a steak they're going to buy eth to stake it they're going to put it into staking and that is go and and the fact that there's net zero um issuance coming to market because of the

withdrawals not being enabled the beast price it's just it's going to reflexively go up then the narrative is going to catch up to it and it's going to push it up even more and this this is not investment advice it's just my thinking around it but then you can look at the other way say the bear market hits again right gas fees drop 90 we're not deflationary anymore blah blah whatever right people withdraw stake and sell that's fine but it always reaches an equilibrium point right and the equilibrium point is going to be a much softer landing than it would be under proof of work because there is so many so much less cell pressure right and the proof of work there is enormous cell pressure like especially the higher you go as hal press mentioned that's usd denominated right for them because the

fact that the matter is that the eighth inflation the btc inflation or issuance stays the same but the usd price goes up which means that you need more usd demand to come in to offset the extreme minor cell pressure denominated in usd whereas post merged with group of steak it's going to be much much much less and it doesn't matter if it's deflationary or not it's going to be reflexive both ways all it is is about softening the the fall softening the bear markets and making each tread lighter than any other asset out there i think the only asset that it would even come close to eight is b and b because bnb has natural demand from finance has a controlled supply and it you can go and look at the chart and so

yeah well you can go but it's still you can go look at the chart right it trades extremely light it just dumps less things it goes up yeah it just it just goes up right yeah it floats exactly so and bnb doesn't even have a narrative attached to it like no one talks about bnb ever like i never see anyone talking about it i do i was listening to his um uh episode with uh on the stacks podcast with uh luke martin uh and he was making a good point that i do agree with is that like these like 300 400 grey gas feeds was actually closer to a one time thing than it is like systemic and it's because we just had super unoptimized d5 for a while we had terribly unoptimized like nft mints and like these weird auctions and it was just like it was just

inefficient and people have figured that out and like learned how to optimize this stuff and like control gas because gas paying overpaying for gas is always bad so i do take that point that like i think these like the era of like 400 way 300 gas prices is probably not coming back um and if they do we don't even need anywhere near that high for deflationary right yeah if we could sustain like 50 that would be that would be i think that's not even just 50. i'm pretty sure at current um eighth state we only need like 15 to be displayed right right right but like i would like to be at like mach 2 or mach 3 ideally yeah yeah like 30 to 45 but the thing is is that it's

it's hard to tell like yeah okay i understand the reasoning behind uh not going back up to those gas prices because of efficiencies because of layer twos all that sort of stuff right yeah but a lot of the fees on layer one are driven by mev um and driven by arbitrage and stuff like that so if you're if we have a full-blown bull market again where everyone's trading every [ __ ] coin under the sun right on ethereum they're still gonna be doing on ethereum layer one there's still so much liquidity on ethereum layer one and they're always will be i still think yeah yeah and and it's the most secure layer at the end of the day like a lot of the whales don't care about those fees at all so i don't i don't ever see uh a layer two becoming more liquid than the ethereum layer one

at least with like stable coins and eth like ether and stable coins and maybe like the biggest d5 blue chips will always find their the most liquidity on it on the layer one yeah i mean i don't know about always this is the thing like it's kind of hard to tell because these layer twos can basically become on par with ethereum in terms of you know decentralization like remove the admin key have multiple sequences have the escape hatching place all that sort of stuff so then big money would be comfortable putting you know their massive eat bags or massive stable coin bags into these things uh because i know but that's where the users are they know that's where the retail users are because on layer one it's whale versus whale right but on layer two it's whale

versus whale versus and retail like you have everyone kind of like there so yeah but we call it from layer one like the settlement layer right and settlement layer by definition is like also has to be the liquidity layer all right so so here's my argument um if we're gonna be comfortable putting our eth on layer twos i don't have any argument with that but like it's either like the shelling point of the ethereum layer one or like which of these seven or eight layer twos are we gonna have in the next slow for two years like that's gonna fracture so there's never gonna be that's not gonna be like the liquidity layer two it's gonna be the liquidity layer one and then there's also going to be all these like applications that are going to call the ethereum layer one their headquarters like the big boys the big

apps the maker dows the aves the compounds the uni-swaps like and those blue chip tokens are also going to predominantly be on the layer one where they're like headquartered and so like you're gonna have the most ether on the layer one you're gonna have all the stable coins on the layer one because where else are they gonna issue them and then you're gonna have like the big d5 blue chips predominantly on the layer one and it's like yeah all that trading fee all the trading activity the the volume on layer twos unit swap on arbitrarily optimism like the one that's being built on cairo right now in stock like they'll have less liquidity but then they'll get routed through like the unit swap on the layer one and so like the yield for lping is probably going to be higher on the layer one

yeah but you could you could see a world where there's just like so many users on these on some of these layer twos uh that they collectively are able to get that liquidity up to similar levels to layer one just because there's sheer quantity of users because you know if you have like users and volume of trading volume is different though no it is but i i just would caution saying never i or like don't like i i would say that there is a possibility there is a classic dude no no no no but i'm just like i think that there is a there's a good chance that it could happen uh but yeah i i don't disagree with what you're saying i just think that like it's too early to even like really know with any kind of confidence

or say with any confidence right now i think it's the default case yeah yeah no i think so as well i think like as i said like whales don't mind and i'm talking mega whales i'm not just talking like million millionaires i'm talking like you know tens hundreds billions of dollars like if they're moving that kind of size around yeah i mean they're not gonna mind paying a thousand dollar fee you know to send ether round on layer one it's for it to cost you a thousand dollars guy would have to be in the tens of thousands i think so so um or ether have to be very very um uh expensive so yeah i totally agree with that um but i think the layer 2s are going to surprise people definitely just by the sheer fact that they're going to appeal to a massive

amount of users it kind of becomes like quantity right yeah putting in a last call for questions yeah both for the youtube and also the uh the uh the uh what are we getting zoom chat i kind of like this zoom chat feature uh we got we got some people in here uh anything else that's on your mind that you wanna talk about i mean it's like a lot but like i've talked about it a lot already um i think you know the the the funny thing is like the censorship stuff the conversations there can literally be endless because it's not an objective thing right like when you talk about social slashing and and then social slashing for specific things and specific thresholds it gets really messy really quickly and i liked

eric's wall eric walls when i read that i was like yeah i'm bitter that i didn't write this yeah yeah and it actually got me thinking in terms of kind of like if i could look into every reality where this sort of stuff happened what do i see in these realities right so you have reality one it's a normal ethereum chain right just continuing on as normal no censorship whatever you have reality two the censorship begins at the block proposal level like a lot of the network starts dropping transactions and or just doesn't include transactions to a certain address or from a certain address or whatever right reality three people the validators stop attesting to certain change the chain split off and then you have ofac chain and real ethereum chain right where do people go

in this reality well in my mind like i don't think most the vast majority of developers would touch over fact chain right the most the core developers would leave before they touched ofac chain right so you have them exactly so you have them remaining on the ethereum chain but then you have on the offec chain like the usdc for example and you have like some big stakers on there but the problem is is that like they're going to cave because that offec chain is just going to be worthless like no one's going to use it the the the token's going to like because they're going to be so much exactly and they're going to be slashed on the real ethereum chain right so if they want to come back they're probably

going to get slashed anyway for doing that in the first place right so the in all the realities that i can think of the only reality that makes sense is just one aetherium you know don't censor at the attestation level if you have to censor at the you know don't include the transactions at the block proposed level that's fine because the tech allows you to do that but we're going to fix that eventually we're going to introduce these technologies as you said you're going to talk about that with justin drake on the podcast so i just and that's what eric eric was article got me thinking about it's just like it doesn't make any sense like you can look through all the different possibilities and come to the same conclusion every single time because at the end of the day these networks are social networks they are community run

networks like if the community rejects a chain then it's not going to be that check i mean look at the bitcoin bitcoin cash thing like bitcoin cash is not bitcoin because b the people didn't recognize it as bitcoin simple as that that's literally all it is right yeah exactly they didn't want bitcoin cash to be bitcoin yes okay there was a thing that bitcoin cash is bitcoin but like no one bought into that except the bitcoin cash people everyone else said that well even the non-bitcoin has said well this is bitcoin right if i if i go to sell this thing i'm going to get you know 20 uh whatever bitcoin is that i'm going to get 20 000 for my btc but for my bch i'm going to get you know a few hundred dollars whatever the price is for it i don't even know how much it is so the

same would happen with an ethereum fork like just because this of chain may have the stable coins and some defy on it doesn't mean [ __ ] because it's going to just be unviable long term no one's going to build on it it's going to trend towards xero no one's going to care about it and it's just going to be this this bank chain as you said like or fed chain like it doesn't make any sense sorry yeah yeah exactly so i think that's what a lot of people miss the bitcoin cash versus bitcoin thing what that made me think of is like there there's there was definitely more like small blockers bitcoiners bitcoiners as we know them than there were bitcoin cash people big big blockers not not like that much more like it was actually very contentious maybe it was like two to one maybe three to one in

bit corners to bitcoin cashers in like total numbers but it was really like the silent onlookers who didn't have like a a fight uh a bone in the fight i say in the bone in the fight and there's a silent majority that was like i don't really care i just want to use bitcoin and there are more bitcoiners that are saying and there's also the higher market cap and they're saying that that one's bitcoin so that one's bitcoin and it's the people who don't care that don't have an opinion that just want to what's give me the normal bitcoin please and then like they just like as a like a silent majority just like okay well i think that one's the normal bitcoin and they all picked that one because like they're because around that one is like three times as many bitcoiners than bitcoin cashers and

it's so it's all like a narrative game right it's like it's always a social story and the amazing thing about crypto i don't know if i've ever told you my crypto joke before but my crypto joke is that crypto makes three main products money you know bitcoin underneath yield and content like crypto people love content it's insatiable like they will just consume all the content and so the market has come to serve this content provided by community members for community members and so it's the community members who control the the the media of the communities and so like there's no way that if we like make like the fed chain versus ethereum that we're gonna like make fed chain the canonical version of ethereum because like people like the

daily gray and bankless and crypto twitter and everyone else would be like oh yeah this this is the real ethereum and everyone else is like okay that one's the real etherium and so like who cares about like these institutions that like write blog posts and say like well we're going with with the bank chains like well no the people tell the story here the the the people are in control of this narrative exactly exactly if you don't if you don't have social buy-in you have nothing basically like at the end of the day this doesn't just apply to crypto this applies to anything think about religions they need you to buy into the story the narrative the social for you to to the the same is true for a a

political party you need to buy into what they're selling to you their positions on things their policies right democracy itself you need to believe that the the country that you're in and the democracy that you in is legitimate and that's actually being followed right as soon as that starts to break down the people just by shia kind of like us having to conform to reality right we can be delusional as we want but eventually we have to accept reality at some point right and have to come together and say well this is the reality of the situation this is not what we want this is what we want and that's why i think like that certain things always trends in in a certain direction over a longer you know the the longest kind of like time path so i i think the the most interesting point

that i can think of is the media stuff as well uh when it comes to the social layer is that yeah me and you and ryan and whoever else does crypto media we're not going to say that the ofac chain is the real ethereum like and you know it's just not going to happen enough money to do that yeah exactly so that i think is very very important and you know i'm sure you saw superfiz uh sharing uh their staking from home setups on twitter those are so awesome do you think any of those people are gonna stake on the offec chain no no the guy running an ethereum validator from his like mobile home that he like like drives around the pacific northwest that guy does not care about ofac chain like no way exactly

exactly so if anyone thinks that you know you'd have majority community buying or an offec chain just because the institutions are there it doesn't matter right like they they don't trust the interest exactly i think there are enough people in ethereum that don't uh uh kind of like subscribe to that don't trust those kind of like institutions and don't care about that sort of stuff but care more about ethereum um and and the funny thing is i actually think that what the other communities say is the real etherium counts for a lot too like would the bitcoiners right not the bitcoin maximalists because we know that they're trying to play games pick the opposite one yeah yeah yeah so like exactly but would the bitcoiners say that the ofac chain is the real ethereum

i don't think they would i think they would say and would the would the other l1 say that no i don't think they would even though they're competing with ethereum they're not going to say that this is the ethereum chain so it's certain banks would even agree with the people like some some certain entities some certain institutions will like actually like understand the story yeah exactly and and the thing is if the the ofac chain is like i'm just using an example here if it's just coinbase and kraken well they have to convi convince binance to go along with them right right you know what i mean like no exactly so it it's just it's an unworkable thing like as i said those realities you can look into there's only one where it

works for everyone and that's ethereum as it is today and i think the biggest argument that i like lands with me is that if if ofac wants to make of ethereum they have to make their own clients for that because the ethereum devs aren't going to make ofac clients like no [ __ ] way uh and so can you see the government making an ether an open source ethereum client like no no no way dude they can't do that yeah yeah it's so bad yeah i mean they'll they'll find someone to do it for them but it'll be a shitty client it'll they'll have bugs in it all the time it'll go down just like just like all government's websites do so so and then at that point why even just do it ethereum like with all the trade-offs that ethereum technology has why not

just create a database and yeah you say you have a pc right yeah yeah just just do a cbd exactly so yeah yeah yeah i just uh yeah i think that's that this is like level 100 crypto like you have to be in this ecosystem for a while to understand all of what we just talked about because it is not something that gets taught to you it's something that you learn from being in crypto and learn from the experiences of being in crypto right all right uh here's uh anthony suzanna's youtube account one more time in the chat uh we do this every now and then last time we done it did this was a couple months ago uh it's anthony from daley gray bank list livestream uh anthony it's been great hanging out with you on this friday morning friday

evening for you yeah yeah lots of fun i'm just about to put the latest daily way episode live as well so if people are itching for more content once we finish here you can go watch the today's refuel oh the content never ends okay no i've been looking at your computer behind you where does it end i actually can't figure that out that this is like the back here where my finger is right now um that's the back and then it that's the the front is it is it absolutely massive yeah it's huge it's like a meter tall and yeah it's like four feet tall right yeah i don't know what the f i don't know what freedom units it is yeah it's massive dude

yeah okay so that's absolutely exactly okay i was thinking i was seeing like the reflection or something but no it's just oh no of course it's a two by four sets of fans of course it's [ __ ] massive jesus it's you yeah it's it's you i mean it goes like higher than where my camera can see it right now it's like up here so yeah it's it's massive that's cool it's actually it actually is made to fit two whole computers in it so you can put two motherboards two graphics cards um two ram like sets of ram and everything in it uh on like this side but i haven't done that i've just got one in there i would imagine the ethereum master node looks something like that yeah yeah yeah yeah exactly goodbye everyone we're done here peace thanks everyone see you later bye-bye