Base: Decentralization Funding, Public Infrastructure, & Onchain Native Life | Jesse Pollak

Transcript

welcome back everyone uh really excited we have a repeat guest Jesse welcome back we ended uh the first episode that we recorded on on base we said we're probably gonna have you really soon because I got I had the feeling that things were going to move really quickly and here we are so much has happened in base but there's also so many questions that I have based on what has happened so anyways welcome back uh really great to have you thanks for having me super excited to be here and just for anyone that's listening for the first time can you just give a little bit of background on on yourself what you've been doing at coinbase and just base like a one two minute kind of intro for for everyone's kind of background yeah absolutely so bases in ethereum Layer Two blockchain

uh it's built to bring the next million Builders the next billion users on chain uh it's incubating inside of coinbase and then gradually decentralizing over the next few years um in terms of my background I've been in the coinbase orbit for the last almost seven years I came in through an acquisition um of a company I'd founded in early 2013 um and then joined coin like 2017. I led all of our consumer-facing products on the engineering side for four and a half years so coinbase coinbase Pro coinbase wallet uh and then kind of starting in mid late 2021 I um took a step back from that role and took on a new challenge which was figure out how to bring the business on chain um you know coinbase was started in 2012 before smart contracts existed before

ethereum existed um and much of our business has been kind of centralized custodial for the longest time even as we provided that Gateway for people to buy their first crypto but then just in the last few years with products like usdc and cbes and coinbase wallet we've started to build more what I would call kind of natively on-chain products um that use Smart contracts uh that are Global by default um that are running on this incredibly powerful you know next Generation platform for the internet um and we kind of said Hey how do we move from having 10 of our product portfolio Beyond chain to having a hundred percent of our product portfolio Beyond chain over the next decade and that became my challenge we iterated through a bunch of different approaches

for that and ultimately realized that in order to kind of make that transformation we needed a platform we need a developer platform where we could build those use cases where we could kind of re-implement some of the products that we have in this new new kind of infrastructure um and we felt like if we needed that then likely the rest of the world needed it to and so thus began base we launched the test net in February we opened the main net up for developers in kind of early mid July we just opened up bridging which basically means folks can start bringing in their funds I think we've already seen something like 120 or 100 million right yeah yeah I was just looking at this morning it's like 120 bridged in um tons of activity tons of excitement

unit swap deployed Sushi deployed so many apps deployed yeah yeah yeah well we got some uh It's Gonna Come Together on Wednesday um uh and so Wednesday is the public launcher today if you're listening today is the the public launch um on the ninth uh and uh we're kicking off on chain summer although on chain Summer's really been going uh for a long time we're just joining the party um and we're excited to kind of help bring the next billion people on chain that's really our goal you know what's really exciting is you know of course over so many years since ethereum really existed and since D5 started there's been a whole Suite of applications whether it's D5 whether it's nft platforms that have existed on chain um but when you look at across a number

of parameters and kpis the users are just not there right there's just a lot of friction to join these and and you know your your mom and pop can't really just go on chain and so um how do you think about you know your existing user base that is very familiar with I mean coinbase is synonymous at least in my mind with crypto in the US and maybe other places yep um with if you're a normal user what is the experience for that user to then interact on chain through base yeah yeah well I think historically you know for the last few years what it's been is it's been um a pretty complicated process where you kind of Say Hey I want to use this on chain product application

um then you need to get a wallet you need to fund that wallet you need to kind of get ethereum to the right place you need to pick what the right place is do you want to use this on you know XYZ chain or another one um and that whole process can take you know minutes it can take hours if you're relatively unsophisticated as we've been starting to build base um and thinking about how do we kind of get that next wave of adoption I think our goal has been um to make it so anyone can go from zero to doing something meaningful in less than 60 seconds on chain um and so that's going from having no wallet and scanning a QR code to having a funded wallet that can transact you know to you know buy your favorite on-chain song or sign up for an unchain

restaurant pass or um you know participate on-chain Community um and all of that can happen in less than 60 seconds uh in a few Taps uh and I think you know with the launch of Base we're going to be um we're going to be there we're going to be from a starting point perspective there's obviously a ton more work that we we need to do in order to get that less you know even lower um to make the experience even better even smoother um and inevitably there's many bugs but I think that's really the North Star it's how do we take away all of the complex decisions that one needs to make and one to make about where they use these apps and you know how they get funding in their wallet and instead just make it dead simple so that billions of people can actually come on chain is it

fair to say that will the user realize that he's going on chain or will it just be such a seamless experience where it almost feels like you're still part of the coinbase like UI ux and it's so familiar but there's a whole set of security kind of things that need to happen in the background so yeah look like I think that it's gonna it's gonna end up being a mix of managed experiences that are incredibly simple and then um more diverse um kind of Rich browser base it's not really possible to just curate and um create first party experiences for every product um you know like and that was really one of our insights with base was um you

know historically coinbase has really focused on building first party experiences right we have a first party debit card we have a first party borrow product um we have a first party centralized trading experience um but I think as we looked at what was required to bring the next billion people on chain what we saw was well that's going to require like millions of apps it's going to require like tons of things that maybe we can't even predict and it if we want those things to thrive we need to figure out how do we actually create a platform for those things to be built but then how do we also integrate that platform into our consumer experiences so people can use them and so I think it's going to end up being kind of that mix where we do have some of those kind of Highly integrated first

party experiences but a lot a lot of our focus is on empowering developers um and letting every day people use these incredible products that are starting to be built on chain how uh and this is where I want to go actually and as a continuation to that statement like how opinionated will you be um around the type of applications and the type of services that Deploy on base I mean obviously the extreme of this is like the App Store and apple right which is super controlled and they extract a lot of rent and and they just are very restrictive at times and it's a monopoly and and so where in that Continuum will you be and how opinionated will you be on the type of things that the user can

the type of apps that the user can interact with yeah absolutely and you know when we look at the kind of next generation of the internet which we think is being built on chain um I think we believe that it should be open uh and that it should be permissionless and that it should be a place where there's no kind of like single party that's curating or controlling or dictating what can and can't be done um and so base is open and permissionless people will put any anything on there you'll be able to build daps of all kinds I think there's a balance I'm not that we're going to need to strike between base and coinbase right I think base is going to be kind of this open permissionless you know experimentation ground that supports creativity that supports Innovation that

enables kind of you know a thousand flowers to bloom uh I think that's going to be the role of coinbase and other folks who are building kind of interfaces for everyday folks on top of Base to help build tools and services that allow folks to distinguish you know which of those flowers do we want smell versus not and we already have been building this from coordinates you know if you go to um coinbase product you'll see dapps you'll see ratings and reviews um you'll see uh kind of uh warnings if you try and interact with something that's high risk um and so I think that balance is really how we think about it it's like base open and permissionless because that's what enables the global online economy that's what enables kind of the most Innovation coinbase more curatorial um

more kind of focused on providing a trusted experience and ensuring that the the products and apps that we show to our customers um are really ones that they know they can interact with with confidence would it would it be fair to say like uh like you can use Google search and you can enable like safe browsing and some permissions would that be a good analogy in terms of if you're going through coinbase itself and interacting and entering base you may just see kind of like a curated validated review kind of peer-reviewed apps that are being safe to interact in a certain extent yeah I think that that's a great I think that's a great knowledge you know I may not say like it's gonna be all the way to Safe browsing like yeah you can use Google

with safe browsing and not safe browsing you can be able to use coins and stay browsing like the analogy yourself technology is like the internet and Google right where it's like the internet Google say browsing where base is going to be like the internet like you know whether you see Finding Google or not there's the internet is chaotic and diverse and uncontrollable um and then folks like Google or Facebook or Twitter whoever it is um do really try and build experiences that you know uh do not direct users intentionally to kind of the the more risky parts of that yeah well let's talk about a little bit about the bridge obviously that's opening up we're recording on the seventh um it's opening on the ninth so let's

talk a little bit about that like what do you yep what are the ways to bridge uh why don't we start there yeah and we actually opened the bridge last week so we opened the bridge on the third um uh and then the main kind of opens for everything and everyone on the ninth uh and so the reason why we kind of did this approach and really it's been a three-phased approach is we're trying to just be incredibly deliberate in how we rolled out this network and this is the first time you've ever heard a kind of large public company build and centralized open blockchain and it's the first time that many of our users are going to be exposed to this and so ensuring that we kind of move in a really thoughtful measure approach felt really important to us and so like I

mentioned on July 13th we opened it up for developers that meant that folks could start building apps on base they could start deploying smart contracts infrastructure providers could start getting stood up we then gave them kind of a few weeks basically to get going to get the first wave of application started um then we opened it up for bridging last Thursday there's a bunch of different ways you can Bridge you can go to bridge.base.org that'll let you bridge ethereum yeah that you bridge usdc it'll let you bridge other assets you can also go to on-chainsummer.xyz uh that's kind of the landing page for uh on chain summer which is kind of all this incredible activity that's happening on chain this summer we're doing a little curating there to kind of give people one thing every day that they can do make their

life better bring them Joy make them laugh and there's Bridge experience there that enables you to just quickly bring eth over to get ready for that that's a really cool one that's probably my favorite one very interactive you get to like feel like you're teleporting to the next generation of the internet um and then we've also seen a bunch of kind of third party folks build bridging interfaces so there's a product called mint.fun you can mint an nft on ethereum there and it will automatically give you some ethereum on base I think that's really cool that's like a really fun user experience where you both get a new kind of on-chain piece of art and you bridge funds to this new world and then we've seen folks like Galaxy and layer

three also kind of build more Hands-On guided uh tours where it's like here are these steps that you take to bridge your first kind of ethereum to base um and so the the reason why we kind of went uh kind of Broad in enabling bridging experiences we want to reach as many people as possible um well again our goal is to bring a billion people from Canada and so some folks are going to be really interested in doing that through you know the consumer experience that feels like on chain summer some are going to be more interested in doing it through like a dedicated nft experience like mint.fun some want the like maximally powerful Bridge interface that lets you kind of configure everything and uh feel like you're really in control and so making sure that we're widening that aperture and bringing as many people in as

possible felt really important to us and for like the perhaps uninitiated listener it's important to talk about bridges because one part of the equation is moving a lot of the apps that already exist in ethereum and various l2s I mean you're built on the OB op optimism stack so but not only that but just if you're interacting in ethereum L1 or any other L2 or you know perhaps other l1s then you can Bridge your assets to interact and base um talk a little bit about the developer experience um you know there's a whole host of apps that already exist out there how easy is it for them or how easy has it been

based on what you've observed the last month for them to deploy on base yeah incredibly easy you know bass is evm equivalent um which means that you can literally run the same house you're running on ethereum um on base and so as we've gone out to folks um you know for most folks it's been oh this is this is really straightforward I was just talking to someone um last night I was like Hey we've been seeing a lot of demand for the the piece of kind of like the infrastructure that you guys are building um and they're like oh we'll just deploy it tonight I need to play tonight um and now it's available on base uh and I think that this is kind of a superpower of what's happening in ethereum right now and happening with the op stack and happening with the evm

which is that when you have um kind of standardized technology um you can like move more quickly and build out these ecosystems um and and you know base we will go from kind of zero nothing on the blockchain to um more than 100 daps uh and which is that that's kind of what we're going to get to announce on Wednesday more than 100 apps that are live um with more coming um and you know this incredible unchain summer experience where every day there's gonna be something novel to do um and if you think about that like speed feed that that's incredibly fast to do all that in a month to get all these pieces of you know social infrastructure and financial infrastructure and media infrastructure and have experiences that people can actually interact with um right at the beginning of the kind of

birth of this new ecosystem um I think that that is a testament to evm it's a testament to ethereum it feels a little bit like a magic trick um but it is really the result almost you know seven years of hard work building this infrastructure and getting it ready for this next phase what do you think about like the next six 12 months look like you know you can certainly have a lot of existing users and apps Bridge into base but I think the more skeptical person would say well that's not a lot right in terms of users um what do you think the composition looks like for the really the new users that have never interacted on chain and where do you think they're going to

gravitate to which kind of apps and kind of the retention and the engagement that you're going to see on on base versus maybe other l1s or l2s that just haven't seen that continued engagement you know I mean like it sort of drops off pretty dramatically yeah yeah well I I I hear that I'll also say if you look at the number of transactions and number of transacting users on l2s over the last year it's basically just like up into the right um like looking at l2b um look at tvl you look at activity you look at unique transaction users we're consistently growing uh pretty pretty much month over month um across the whole L2 ecosystem and so like my general feeling is we've started

the growth curve for adoption that will not stop until the entire world is on chain and so the next two years are going to be that growth curve accelerating and that acceleration being driven by more real use cases that aren't just speculation aren't just Financial um but they actually provide kind of real value to folks um every day and so you know when it comes to base I think a lot of what we're interested in and focused on is um uh kind of like consumer products and consumer use cases uh some ones that come top of mind to me is we have parallel which is you know really like an incredible um gaming studio that's built a trading card game that's fully on chain um they're also building a full kind of AI powered um MMORPG called Colony um and they're building it all on base

uh and so that's going to be this kind of entry point for you know folks who are really into gaming and then you know do a ton of exploring from there we have Blackbird Building on Base that is founded by Ben Leventhal who created eater and rezzy um and he's back for a third one uh building a fully on chain restaurant uh kind of subscription loyalty platform um the experience is crazy you know you like walk in you tap your phone at the restaurant they instantly know who you are they you know handle your it's all handled through the app you can sit down and walk away whenever you want they bring you special things um you know I I think these kinds of experiences that are uniquely enabled by this new on-chain platform um but are again not just speculation of

actually real world utility I think that's what's going to bring um kind of this next wave of users over the next couple years um that will be more sticky um that will uh you know kind of throw the world whoa this is this incredibly powerful platform kind of like the dawn of the internet um that's starting to take shape that is going to onboard you know billions of people over the decade and so um that that's what we're excited about obviously the financial stuff will come to usdc is a huge part of our strategy um those pieces are coming but I think we think we need it all um we think we need all those pieces to bring in the diversity of the ecosystem that's going to really enable us to grow that's really interesting like the the

restaurant reservation for instance is really cool because everything it's sort of like very integrated like you have seamless checkout with usdc right which user would already have you get the points maybe you have an nft tied to that loyalty for that particular restaurant every time you go you get a different nft um so all that seems great what about the privacy of that like if you're a user and you end up going to say one restaurant but then you go to other restaurants like my you know that restaurant might be able to see your entire purchasing behavior and interactions and that poses some sort of interesting privacy um questions so I'm curious to get kind

of your thoughts around that yeah I think that um absolutely and if you look at like kind of the the history of um you know restaurant in general this kind of Engagement I think you'll see that many people are comfortable with having kind of a lot of that information public like your Yelp reviews and your checking history on Foursquare um but there's a lot of people who also aren't and I think generally privacy is kind of one of the next big uh problem spaces that we need to take on as an industry when I look at what kind of we've been building towards the the three ones that we've been most focused on I've been most focused on are driving down the costs and that's really what we're doing with Layer Two is like base reducing costs from you know a dollar or five dollars or ten dollars to do

something to sub 10 cents um and then eventually subset um the second is building better wall experiences um so people can actually use these Technologies I think you're starting to see that kind of finally get to a reusable place with products like coinbase wallet and rainbow and the coinbase app the third is identity where I think we really need a real sense of identity on Jane um and you know that's again starting to emerge with things like World coin um coinbase is also working on some products here that can be rolling out natively from base um and I think like now that we've kind of gotten a grip on those which I really felt were kind of core building blocks in order to enable this next wave of applications I think we that now need to turn our attention to privacy um and

it's been cool to see a lot of research happening there um you've seen vitalik kind of leading the way talking about stealth addresses and what we can do kind of without having to do math and protocol changes to ethereum I think there's a ton of really really interesting opportunity there um and I expect that over the next one to two years we'll be able to if not fully solve um you know mitigate privacy concerns and have paths to play solving them hey everyone we'll get back to Empire in just a minute but before we do that I want to let you know that we have permissionless coming up permissionless is Big conference that block works and Bank lists put on together it is the biggest the best defy conference in crypto this year it is in Austin Texas

September 11th through 13th if you've been in crypto for a while you know that bear Market conferences are the best kind of conferences we have a phenomenal lineup of speakers a lot of the guests that you hear on Empire are both going to be speaking there you will have the opportunity to meet them there and a lot of the topics that we cover on Empire ZK attack roll ups account abstraction Mev app chain thesis a lot of that kind of stuff that will all be discussed at permissionless this year so because you are a listener of Empire you get a special discount that's right Santi and I negotiated with our marketing team you get 30 off if you go to blockworks.com forward slash permissionless Empire 30

is going to get you 30 off your ticket today when I'm recording this that's about 300 off your ticket so type in Empire 30 when buying your permissionless ticket you get about 300 bucks off click the link at the bottom of this episode it's in the show notes do it quickly because prices go up all the time and if you are going to permissionless hit me up let me know shoot me a DM on Twitter I would love to meet up with you there you know one of the things that I want to touch on is kind of how do you see the modernization model and how impactful base can be or will be in your mind to the general business model of coinbase which has historically been you know an exchange it relies on a number

of fee streams but predominantly had been trading fees than some custody and um and then now a bit of subscription but bass can be fairly profitable we look at just the profitability of l2s by themselves so I'm curious how you think about the overall monetization of the base and how impactful it can be for coin business overall business model yeah I think when we when we look at base the primer and think about monetization the primary lens that we look through is not base itself but how does bass enable the next wave of use cases that grow coinbase and grow coinbase is ability to monetize and where that comes from is if you look at what coinbase you know has done

historically um and you kind of take through a few of the monetization streams you know uh trading custody uh you know savings today with usdc uh staking um all of those are kind of like crypto economic verbs that coinbase has made really easy to do and in exchange for making it really easy in exchange for doing that in a fully trusted way we've seen that folks are willing to pay um because they value that trust they value that ease of use and I I think that our general perspective is those are still a really small number of use cases right we're talking like two to three things that people do right now with crypto and with what we're doing with bases we're basically you know widen that aperture and there's gonna be

hundreds of things for people to do with crypto and in that world where there are hundreds of things that that people can do with crypto coinbase is going to continue being able to provide that trusted interface on top of it and they're going to benefit from having kind of more things to do that can you know have more interfaces built forward they can take more fees by basically doing it in a trusted way and so I think it's really about kind of growing the pie of what people do on chain and then finding ways to monetize that and trusting that if we grow the pie if people are transacting living more of their lives on chain and that's going to end up being a kind of lucrative a really lucrative thing for everyone nice because ultimately they're still going to have to use coinbase itself the

exchange for on and off ramp um and and maybe staking or whatnot yeah and I mean and they're going to use coinbase and coinbase while it's actually access these apps and use these products right like if you look at coinbase wallet today like and coinbase you can trade via YouTube um uh and that's you know us providing a trusted interface um folks maybe don't even know that you know behind the scenes um but uh it gives customers access to way more kind of opportunities um and so I think it's going to be that coinbase kind of becomes Gateway or interface for this new on-chain economy and that owning that relationship with the kind of everyday person and the user is going to be a really good place to be

yeah how uh at a top of your head now that you mentioned coinbase wallet like how many what percentage of like the overall user base of coinbase maybe coinbase retail uses coinbase wallet I don't have the numbers off the top of my head um but I will say that I think like quemy's wallet is where a lot of our kind of like Unchained native contain forward customers are transacting because it's really built first and foremost for that on-chain product Fleet yeah yeah I was just trying to think of like what the conversion rate is going to be of the total like coinbase users really retail in a base um and how different will that be

relative to kind of like just purely coinbase wallet which came as well was just like hey here's a wallet you can use it and then just go and Venture which steals feels like it's pretty daunting right for the normal user whereas basis feels more of a here is an app store an ecosystem kind of like how the iPhone was pre-loaded with some apps just to like give users some ability to just start using stuff and they could be familiar well and I think similar to the way that we um thought about kind of having many bridging interfaces I think we we also believe that it's going to require many user interfaces to base to for people to get kind of comfortable using this next wave of applications so obviously coinbase wallet that's going to be kind of more sophisticated users

although I think it's getting easier and easier literally every day um you know like as part of this uh base effort and the on-chain summer effort um we have taken an onboarding experience that used to take you know a few minutes five minutes plus um and have you know more than 10 steps and we've condensed it down to literally one step so you set up your phone you face ID you download the app you face ID you open and and it opens up with a configured wallet that you can start transacting with um and so I think that coinbaseball is going to get easier and easier but it's also still kind of on the more sophisticated side the the other side in coinbase we have uh the web 3 wallet which is a fully powered crypto wallet um that can transact on base that can

use all these apps that can um you know do dexbobs can do literally anything that coinbase law can do but the key management model is slightly different so coinbase does it in a semi-custodial way um where uh the kind of shards through MPC are split across your device and coinbase servers um and there's a recovery process if you lose your device um and that is an entry point where it's just alongside the coinbase app it's in the coinbase app so if you're just someone who's only ever traded before using the centralized exchange but you see hey oh here's this asset that I can't access uncensorized exchange but I want to trade you can just jump into that and it's super easy or if you see hey here's this octane summer experience I want to do but I've never transacted on chain you can just jump into that

wallet again and so I think those are two experiences that coinbase provides you know bases even bigger than coinbase right we also have we have you know all these folks who are building interfaces that enable people to access this economy that's starting to grow and so as you know the next year kind of happens and as these use cases mature I expect we're going to have a whole spectrum of like this is fully handled for you um to like you are deep in it um one other experience which I didn't mention which I think we've talked about yeah never mind we were building a ton of institutional experiences as well to make this really really easy um because you know it's not just everyday consumers who are trying to

figure this out it's also a distribution institutions yeah right who are like how do we track transact on chain and make that really easy yeah yeah I mean I I remember using fire blocks uh but it was I mean I think it's it's fairly clunky or was I mean it's not perfect um so really excited at the right time you can talk about that but yeah yeah well I mean we've been using them internally for base we've been like kind of dog fooding and demoing and it's it's epic it's it feels like you know if you just have a really powerful crypto wallet but then it has all the institutional security trust everything behind the scenes so we've loved it really exciting um I want to talk a little bit about like I remember in the early days using coinbase way back in the day like you

you would be getting like for every referral you got like some very like ten dollars a Bitcoin back in the day ten dollars Bitcoin and that ended up being you know like over a hundred or more depending on when you got in will there be some I I know there's a whole host of grants that you guys have disclosed but also other organizations like youth Global has like 125k prize pool and hackathons will there be um incentive for users to start interacting on base so if you have a coinbase account say hey we'll give you X depending on certain activity and different apps like yeah is there like some sort of incentive or will be yeah yeah absolutely I mean they already

are today we started experimenting with these with um opening of bridging so in the coinbase app and in coinbase wallet there's quests um if you bridge uh uh ethereum to base you get a little East on top um you know enough for a kind of like 10 15 transactions um or kind of like one to two nft mints um and so that's kind of a first experiment we're not just experimenting with that with coinbase products we have similar uh kind of incentives that we've done with layer 3 and Galaxy uh where if you go through their flows you can earn a little bit of Youth you know enough for 10 to 20 transactions same with mint.fun where if you kind of meant this bridge nft uh you get ability at the end and so I think we're kind of in the like early stages of experimenting with these

incentives as kind of the summer gets going and as we start entering the fall we also have a bunch of um folks who are really excited about accessing kind of uh various customers through base and so it's not just going to be um kind of Base that's running incentives to get people onto base it's also apps on days yeah that are going to run incentives to get users to transact in their apps on base I think this is the really um powerful thing about this flywheel is we are building um an ecosystem where you're going to have a thriving economy of apps who are looking to grow are willing to to kind of spend for that growth and that's going to bring in more users uh coinbase has this kind of incredible pipeline of users who are you know ready to get

activated ready to come on chain and that's going to bring in more apps and we're going to kind of gradually grow the number of Builders and number of users until we have you know million Builders a billion people on change yeah yeah I mean it's really exciting when you think about it you guys have over last time I checked over 100 million users and over 10 million actives and so that's like huge if you're any app out there I mean the it's so enticing to be able to tap into that that consumer base and also institutional base so there's really no reason why you wouldn't want to deploy on base like yeah I think that's that's kind of what we've seen pretty consistently of course it's going to take time you know like this is this is our first time figuring out how to build these systems uh to kind of plumb

through users and make it uh kind of work and I think importantly it's going to take work on the app side to make really high quality apps that people actually want to use and to integrate those experiences and so you know I don't think we're going to snap our fingers and have 10 million people 100 million people on chain overnight but I do think that we have this incredible Foundation that is going to allow us to over the next couple years bring in not just those folks but literally the whole world to start to experience these incredible you know new use cases but also just the like uh the incredibly powerful uh the reality of what Unchained means I mean I was this weekend uh we were opening up base for bridging we decided

to do that in Idlewild California at FWB fast which is a really intentional decision we brought our whole team into the woods to launch base um and we did that because we felt like it was important to be like surrounded by something bigger than just the base team at coinbase like surrounded by culture surrounded by people who were thinking about this space in ways that were really different than we might have been thinking about at coin and one of the most inspiring conversations I had is I was talking to Chris I'm a musician and she was telling me she said since I came on chain and started putting my music on chain my life has changed like I earned more money I have more economic freedom I'm able to have more reach and it's not just me like as I brought my

collaborators and friends on chain um their lives have changed yeah and that's not an anomaly that is the result of people moving from a system where the uh kind of economics and the the the controls and everything is is is managed and controlled by a small number of players who for the most part are extracting value from the folks who are creating the the incredible Brilliance of the internet to a system where when you build something on chain or you create something on chain it's yours right and the value flows to you and you maintain your autonomy you maintain yourself ready and so I think that over the next few years what we're going to see is ring this see people start to make that switch and we're gonna see

their lives start to change and that's going to be this incredible feedback loop where it's like oh if I move on chain I live a better place let me tell my friends let me tell my family let me show the world that this is a better better way to live I absolutely agree with that I mean I think the common criticism is this is just pure financialization and speculation which inherently is about I mean like every like technological Revolution relied on underneath all of that underpinning that was like speculation right but like when you look at the stories of creators and nfts are always a great example that it's so relatable to people because you then touch on how benef how powerful it is this idea of having digital scarcity and be able to provably create digital work and content claim it as yours and then

monetize it without having to go through a gallery or you know because it's been super challenging for so many artists that if you're not in New York if you're not in these hubs and it's increasingly hard to get discovered and interact with your core audience right so I think that uh I mean a lot of like we have a regulatory pod here and what time and time again the question that the the criticism is always we need to show more actual like use cases right and the prime example that like uber faced a lot of regulatory pushback but it just became such a great product that you're just like it just overpowered right and so I think we'll get there and I'm really excited to see these kind of use

cases in base um I want to go back to one thing around identity because I think it's such an important thing I mean you you have World coin coming out and there's a whole you know you could argue if it's good or bad um but one of the things that you do have is you have already kyc'd and you know a lot every user that as you've onboarded on coinbase yeah um when they interact on chain the big the biggest issue on changes like this idea of like civil resistance like one user can have hundreds of wallets right and so when you think about rewards like it's it's really hard right yeah or has been to create like a kind of a cohesive like identity fabric for for on chain um how will you guys play a role in that

given all the data and that you have already from your existing users yep yep I think you know it's not just civil resistance yeah I think that like civil resistance and being able to do incentives is really important uh kind of Gap that that identity can help fill um but another one from my perspective is just um like expanding what we can build from a product perspective on chain requires identity right like if you look at the primary um uh kind of like lending product that is used in the United States it's under collateralized credit card loans right and the only way people are able to get is because of identity systems and are those identity systems perfect like yeah like a credit score right right you have

a credit score that allows you to get you know extended amount of credit like you know those identity systems are not perfect but in order to even have the concept of uh like a line of credit that's extended to an undercoateralized way you have to have some identity system because you have to know are you a trustworthy person like can you be Reliant upon to pay back that that bill um and so I think that that gap of identity is actually like holding back in a really significant way this next wave of use cases even if it's just kind of similar use cases that exist off chain coming on chain and benefiting from the efficiency benefiting from the kind of low costs um and so I I think identity is super super important um in in terms of kind of your question of kind of how is coinbase going to play

in this um you're exactly right you know we have uh probably you know one of the largest uh kind of verified identity uh kind of databases and and users uh in the world uh from a kind of crypto perspective and so what what we want to do is we want to unlock those people to be themselves on chain and that means Building Products that allow them to bring their identity on chain in a you know private way allow developers to access that identity on chain so they can build new experiences like you know like the products we were just talking about and you know build better incentive systems so that they know they're kind of rewarding and attracting uh real human beings and we're doing that really quickly you know we have efforts in sight already you know bass

is obviously launching on Wednesday but anything you can expect that will Fast fall over the next couple months which what we believe is infrastructure that will enable that next wave of use cases by building and bringing out better identity Primitives one thought is on that though is that I I don't think that these um kind of identity Primitives will be like monolithic like it's not like going to be oh coinbase is going to identify everyone in crypto and that's going to be the way to do it instead of what you're going to end up having is um kind of these pieces composed together so you you can have your world coin World ID on chain um there's gonna be a bunch of other stations that you can get maybe all these things are going to live

your imagination Service uh which we're really excited about um and those are going to kind of combine together to create the fabric of who you are as the individual and that's going to be uh it's going to be better for the world because it means that there's not going to be kind of one single point of failure on one single point of control that like Equifax of you know the web 3 web 2 world who um uh you know you have to get on the phone with and call instead there's gonna be a bunch of different levers that you can to identify who you are on chain in a way that aligns with your values um that aligns with kind of what you you know want to show the world I think that's going to be a huge positive yeah yeah I mean when you think about your your

credit score is really static and doesn't I mean there's so many different parameters that you can incorporate to build a better identity model and then and then feed that into defy and do a whole host of like set the interest rate and just think about like how riskiness you are tomorrow or I mean there's I mean at the end of the day blockchains are data rich and so you can train models based on that data that are way far and Beyond more efficient than like you know you know Social Security or credit score if you will yep um it's gonna be cool it's gonna be really cool yeah no it's fine and you attach an nft to that and that or like a zero knowledge proof and like sort of like all this like finally can come together right um I want to talk about you know in this

vein like obviously we saw bald which was like this meme coin that existed for like a few days it was pretty crazy it reads like 100 million market cap someone deployed it uh with over 25 million of liquidity in the pool and then poof like the the deploy like rugged and like took away like probably five million there was a speculation that it was SPF from his parents basement all kinds of stuff and then the obvious question was like and this goes back to my initial question around how opinionated you will be in controlling this experience because at the end of the day like it attracted a lot of attention and it's maybe not the right kind of attention that you want but these things happen right because you you can't control these

things or at least so far you guys haven't like clamped down on it is there a point in time where you you do have an opinion on that and you create a permissioned environment if you will for only users that have identified themselves and you have that ecosystem of apps and you kind of ring fence it to create a safer experience or do you not do that and you just let it let it rip you know just so people wanted to play The Ball 2.0 then that's it like it's a wild west yeah you know I think we've been I think we've been pretty consistent on this from the beginning when we when we announced base and as we brought it through test net and as we brought to developer preview and

um even opening for bridging um bases and open information the blockchain it's like the internet um it is like the internet it is an extension of ethereum and we believe that that open permissionless Nature uh the open permissionless nature of the internet uh is the thing that um you know of course always has some Arts but enables incredible creativity and it has enabled you know so much growth over the last 20 years and will enable so much growth over the next 20 years because we're going to have this open global economy that puts everyone everywhere on a level and without that open permissionless Nature we don't believe that we can get to that open global economy and think that that would be a real loss and so base is going to remain

open and permissionless I think this goes back to the conversation we're having earlier about kind of what's the distinction between base and coinbase and how can those things interplay off each other and again coin base is going to continue providing trusted you know easy to use experiences on top of Base that help users interact with the things that are make sense for them are going to give them real value and I think that's where kind of curation that's for filtering that's where those things are going to fit in I mean I think that balance not just between base and coinbase but between base and anyone who's building experiences on on top of coinbase on top of base for everyday people that's what's going to let us light the internet um kind of have the unbridled creativity and also have the kind of trusted

experiences that everyday people can rely on yeah because candidly I mean curation in my mind is not a bad thing like if you if you have Partnerships with for instance apps that you've independently you or some some trusted party or Consortium has reviewed both at the code base level Right Said by the way it's audited it has these checks like similar to D5 safety score which I think you guys were a part of yeah they still are where like you may have Partnerships with uniswap as the preferred decks if you will because hey you know you feel comfortable with that um and the last thing you want is for your users coinbase users to have a bad experience on base because then that has

a whole list of implications back to your main core business model that it releases today right 100 and I expect that coinmates will do that and and that base will continue to remain kind of open permissionless incredibly neutral um kind of supporting the the full ecosystem and helping it Thrive um yeah so it's uh I think we're at the very beginning of what's going to be a really exciting next decade where um there is so much creativity that comes on Jane um and I think there will inevitably be moments where folks like oh this is scary or oh this is um risky um but I think it's really important that we all kind of see beyond that and see oh this is a part of the creativity this is a part of you know how Innovation happens

it's messy uh and we need to kind of see that whole spectrum and then we need to figure out how do we build and enable folks to build um trusted experience that give the right kind of sections of that Spectrum to the right users right um I guess I also want to get your thoughts there's so much happening in the ethereum ecosystem and you're very plugged into that like account abstraction and on-chain messaging and a whole list of things but before we get there maybe as a last question on base and if you want to touch on other things we can do that but um like what kind of projects are you most excited about um to see either deployed that exists already somewhere else or new kind of projects that you all feel particularly

excited to to deploy on base yeah I think that the things that I'm most excited about are like real consumer experiences like apps um that folks actually want to use you know I think Blackbird parallel Unchained restaurants and food on-chain gaming um Unchained media like those are things that I think have the potential to bring a billion people on Jane if you look at kind of the rise of different consumer applications over the last you know decade whether it's tick tock or even chat GPT um you see that one state kind of have product Market fit they grow very quickly they um can go from having no users having hundreds of millions of users millions of users in the first amount of time and so I think that we're kind of at the point where we think the infrastructure is ready

um for folks to start building those products um and that those products are going to be um kind of uh new and different and Powerful ways that people don't really understand and we want folks to be building them on base um and so if you're out there and you're building a cool consumer product a social product um uh kind of anything that you think has the potential to reach a billion people come build with us on base um so I'd say that's one one audience of course also really excited about the financial use cases um we've been thinking a lot about kind of tokenized assets or real world assets and how we bring in that next wave of Institutions I think that that will will kind of be complementary as well um but definitely you know this summer uh really focused on those those summary

you know consumer use cases and you know I guess the last thing I'd say before we pivot a little bit to ethereum um is if you're just getting started on chain or you're looking to dive in um join us this summer Unchained summer you can go to unchainsummer.xyz every day there'll be something interesting and cool to do starting on Wednesday uh base day one we have uh some cool content to drop that's coming directly from the base team uh that you want to you know participate with um and then you know every day literally including weekends all the way through the end of August there'll be one thing that we kind of curate and then there's gonna be many things that are already just organically popping up across the base ecosystem and we'll be showing it all off at unchainsummer.xyz that's

awesome I want to get your thoughts on a lot of the what's happening in the ethereum ecosystem and maybe as a as a Segway and there's a lot of the talk about l2s has been yeah they've been super powerful to your point like you know it's been hugely impactful in terms of Engagement but one of the open questions is the sequencer and the decentralization of that set sequencer at the moment it's not right across any L2 out there how do you think about the running the sequencer for bass um I've heard you talk about in the first episode people should go back to listen to that if I remember correctly at the moment there's kind of no plans it's just it's going to be run by coinbase and and and then TBD what happens next right uh but I'm curious I'd say it's more fleshed out than that

um today coinbase is writing the sequencer um in parallel uh We've um committed to this kind of open neutrality framework that we we helped develop with optimism called The Law of chains um which kind of lays out how do we run the sequencer what are the neutrality Commandments that we need to make in order to continue being able to run the sequencer and then also kind of puts us on a path to um moving towards a world where we have the specialized sequencing and likely shared sequencing where you have one sequencer that sequencing many op stack chains including base including op mainnet uh Zora Network Etc and so um we're just getting started on that Journey the most recent Milestone is uh six weeks ago we opened up a request for proposals

um uh via the optimism Foundation um where we gave out a grant um to kind of do a first prototype of a shared sequencer uh sat that would enable the next stage towards the centralized sequencing um that prototype or that RFP was granted to an organization called espresso Labs that's been building a decentralized sequencer set um they're working on that now and we're really excited to be collaborating with them and so I think we're actually making really solid progress um it's the same thing on the ZK side a lot of folks are like hey you know is based an optimistic roll up like what's going on here and I'm like no we're roll up we're gonna have an optimistic prover but we also just gave RFP to two teams

the o1 labs team who built Mina as well as the risk zero team who's building a risk five zkebm and both of them are building ZK approvers for the op staff that will enable us to fully ZK approve the op stack get all the benefits from a finality perspective from a security perspective and do it in a way where we have actually multiple clients which is going to increase decentralization and so the way we think about base the way we think about the super chain and the this this this kind of Technology stack that we're building is it's going to be built open source it's going to be a public good it's going to be contributed to by a large number of teams you know coinbase and based or a second core developer but there's many core developers joining

um and that kind of team effort the super team effort is going to lead to an incredibly powerful kind of Technology stack that anyone can use to either run an L2 or to run a chain and all of those things are going to come together to provide the bandwidth and the capacity that actually enables us to run applications at the scale that can onboard billions of people right right and people should go listen to because we recorded a great episode with espresso and Celestia teams to talk if you want to learn more about sequencers because some of this might be technical jargon you should go listen to that um yeah I want to touch a little on on-chain messaging I heard you talk about how important that is um and you've done an integration with xmtp can you just touch on on why you

think that and kind of the relevance of that yeah absolutely um and I think this this also goes back to just kind of the idea of everything moving on chain um that we can move a lot of the products that have been off chain on chain and in doing that get um better experiences and better outcomes for everyday people um and I think a great example of this is on chain messaging right if you think about um kind of the messaging that most of us do uh you know whether it's iMessage or Facebook message or Instagram message um today that messaging is silent um luckily we've moved to a point where most of it is encrypted um which is great but it's still controlled by one organization it generally doesn't have

interoperabilities so for instance you can't iMessage someone on an Android phone you get the Green Dot blob and everyone hates the green dots um and I mean I do I'm biased right like I want my message bubbles to be blue um but you know with on-chain messaging all that goes away right you you have encrypted messaging but it's not controlled by anyone organization it's not locked into any one UI so the messaging that you're doing Vietnamese wallet and SMTP is also accessible in other apps like Converse or the xntp web client or lenster um and I think over time you're gonna have more and more folks who kind of support that that standard and that

means that users are going to be able to move their identities different products they're going to be able to eject if they want to um and they're going to be able to benefit from having messaging on the same platform using the same identity as all the other things that are happening in crypto and so you know you can just send usdc alongside the message on paste and all of that just works and composes together and so I think this is a great example of where we're kind of like we're upgrading the system um we're saying hey here's a bunch of kind of Legacy systems that have shown us what's possible but they don't work that well together and now let's take those Concepts and build them on this new on-chain platform and do it right and upgrade folks to that experience and deliver a bunch of

value to their everyday life yeah absolutely yeah really in my mind just takes one killer use case to really prove how beneficial it is to interact on chain and I think some throughout this journey a lot of people just lost because either you know fees were really high at one point and they're no longer but they haven't really care to come and revisit or they had a bad experience or it was bad on and off ramping but I think people just touching on on the development of ethereum a lot of people have like dropped the ball that dropped them up just lost interest at different points in time but they don't realize how far the infrastructure has come yes um so the merge was something that's super impactful and I've heard you talk about

that as as kind of like something that is quote unquote like like likely top five most complex technical organizational and incentive migrations in human history um yeah I mean this is like yeah yeah that was that was your quote which which I very much agree with like people like don't recognize how hard it was to agree on something and then and then and then upgrade an entire decentralized system yeah I mean it's huge from a coordination you know I think that ethereum will end up being is is becoming one of the most important pieces of technology in human history and the fact that we were able to even do that migration and and land the impact of that migration you know

the increased security the massive reductions in energy usage which is so much better for the environment um the like platform that we now have to develop further on and so yeah really an incredible achievement and I think the the even maybe more mind-blowing thing for me about that is like we're just getting started with ethereum you know we've been working on this thing called eip4844 uh for last year and a half with ethereum core developers and and coinbase and op Labs um and that's going to ship this fall hopefully um and it'll lower fees on Raw so l2's like Base by five to ten X yeah and like that's a year and a half of work that we've been putting in to make that happen and there's a bunch of other

upgrades that are happening to ethereum and the op stack that will you know similarly take time because this is a really you know complex piece of technology but we'll when they land deliver massive massive massive impact that's gonna enable developers to build more cool products and enable everyday people that come on chain um at lower costs um with more you know interesting things to do until we have literally everyone on chain yeah what are your thoughts on account abstraction and just for General listeners like how how impactful will that be for ease of onboarding and and just creating kind of these uh experiences for users yeah I think it's super super important um I think that we're kind of right on the precipice of flipping to a world

where most users first wallets are smart wallets that are enabled via contraction that give them much more flexibility much more control and enable them to kind of progressively increase the security the the power over there and so like a simple mental model of this is like you can set up a smart wallet the first kind of security audience you can just have a phone number so you verify with six digit code um that's maybe a little bit more centralized but if you don't have that much balance in there that's fine and then as you get you know 100 or 500 you can say hey do you want to add another signer to it for large transactions so now you don't just need the phone number you also need uh you know approval on your computer or whatever it is there's

going to be this way of us progressively upgrading the security model of these wallets which I think is gonna be really powerful and there's also going to be so much that we can do from a just abstracting complexity perspective um in terms of using the Smartwatch so whether it's bundling a bunch of transactions together so you can actually just do what the user wants rather than having to have them approve every single step or it's letting people pay gas in whatever currency they want um so you can just pay with usdc that's what's easy for you or if it's just subsidizing gas entirely because you can kind of look and say hey this is a smart wallet that you know is a real human being and that's a station and we want to encourage them to use our product and the developer is willing to take on that

cost just like they've always been willing to take on the cost of running compute elsewhere so I think that it's going to be huge I think coinbase and base are going to be kind of at the The Cutting Edge of pushing it forward and I think it's going to be a key lever for bringing the next billion people on shame yeah I think so and just that as I was hearing you talk about that I mean one of the things that we haven't touched on much in this episode has been just the importance of usdc as a kind of a fluid to like power so many different applications and just Commerce and if people forget but like if you're in the U.S like it's not as tough but if you're in in other places it's not as easy to like to do payments or to do cross-border

payments and whatnot and like uscc's huge in that and you guys play a huge part in that obviously and so I mean you can Envision the growth of usdc as being one of the primary benefactors of just base and just increase activity going back to you know how it impacts your business model right so uh Beyond just Financial like speculation use cases right yeah but it's really things for people to do on-chain yeah I mean just the ease of convenience with account abstraction and just the logic of like subscriptions for instance like a huge promise to ask companies is the drop-off and renewals just purely because a credit card didn't work does that problem goes away with uh usdc you know I mean like and logic attached to that um well it's fascinating I mean I don't

know if there's anything else you want to touch I know we're taught nearing the top of the hour here but um maybe to recap for listeners here uh just action items this Wednesday maybe just go through them yeah this Wednesday uh base opens for everyone and everything uh you can get started in the coinbase app or a coinbase wallet or rainbow or trust wallet or any wallet um come on chainsummer.xyz if you're looking for something to do every day from August 9th through August 31st we'll have one thing that's really fun really cool to do on chain and then a bunch of other things that folks have built all across the ecosystem that you can go explore if you want to go deeper um if you want to use usdc go for it if you want to you know swap go for it

everything will be there and so come experience what's happening on chain this summer um really really excited that that's kind of the primary call to action I'd say the secondary call to action is um it's gonna take all of us to bring the world on chain right this isn't a thing that bass can do alone or a coinbase can do alone or you know the the folks we've been kind of collaborating with can do alone it's really going to take everyone who's in this industry working together there to figure out how do we build that next wave of use cases how do we convince our friends our family to give them a shot and to see the transformative power of this new platform and so I guess my asks tell everyone who's listening is go build something go mint something go create something go drop it on base or

on ethereum or on opium or whatever you want but contribute contribute to bringing the world on chain starting this summer because if all of us put our minds to that it's going to happen faster we're going to pull up the timeline and we pull up the timeline that's going to have a massive positive impact on the world so join us get on chain this summer that's awesome Jesse uh I as I said last time in the first episode uh it seems like there's so much happening in base and uh we ought to have you uh again sometime soon I'm sure you'll be back uh so I think I'm excited to also see you guys at permissionless yeah of course in September so that's gonna be awesome event you're you're speaking all right speaking there uh really grateful for

the opportunity and grateful to be uh continuing to build with y'all uh as we kind of bring the world on Jane yeah incredibly exciting I think this is I've said it before but I think bass is you always kind of think about Catalyst to reignite interest uh and and in my mind this is um this is perhaps the most impactful thing in my mind to really onboard users because there's so much the infrastructure I think is ready um and I think that there's a whole host of applications that people just haven't taken the time or interest because it's been hard to interact on chain right and so you guys are really playing central part in that and bringing you know millions of people on chain and so incredibly exciting Jesse um thanks so much for coming on and sharing more insights and really excited for uh you

know uh bay summer awesome thank you everyone [Music]