Blob usage up, Zapper Protocol and more - The Daily Gwei Refuel #782 - Ethereum Updates

Transcript

hello everyone welcome to another episode of delway refuel break up the latest news and eum EOS system I'm your host Ando to the 14th of June 2024 all right everyone let's get into it so I feel like uh today or at least the start of this episode is going to be a bit of a funny bullish rant because I feel like I'm a teacher getting into a classroom where the classroom's just running a mark being disruptive and not doing what they're supposed to be doing and the analogy holds with what I'm going to talk about because I feel like the classroom is kind of crypto Twitter I guess or like crypto the crypto ecosystem and they're being very bearish right now and as a teacher literally as an educator I'm quite upset seeing this because there is no reason to be bearish right now and anyone who is bearish is

as I said in my tweet quite literally missing the forest for the tree so I want to go on a little bit of a bullish rant here and it's related to some of the news that came out I guess like something that I saw on Twitter that came out that I'll cover in a sec uh as well but you know I'm probably not going to say anything new here but I'm going to reiterate some of the points here because as I said there is no need to be bearish and I put in my tweet I said open up your time Horizon a bit over the coming months and years trillions of dollars of net new money is going to flood into crypto get off the daily charts and zoom out obviously in crypto a lot of you are in it day-to-day I do a Daily Show right you listen to my show

every day you probably checking the prices every day we all do it right and that basically uh means that we have a Mis misalignment in our brains around what we expect the price to do and what the price is actually doing what we expect the markets to do and what the markets are actually doing if you're checking the price of eth day-to-day then of course you're going to be like why isn't the price moving oh my God it doesn't feel like eth's pumping and then two weeks will go by and you'll be like oh why did eth go sideways for so long it's like guys it's been two weeks relax yeah but then you zoom out even further onto the monthly time frame or the yearly time frame and ether has been up only I mean ether has been up only for 2 years now since June 2022 on the monthly

time frame as I discussed or sorry on the yearly time frame as I discussed the other day there so there is that mismatch there now during those periods of time where you think nothing is happening to the price plenty of things are happening on the fundamental side of things and on the market side of things and on the you know the new money coming inside of things uh and those things take time to play out it's not going to play out day-to- day you may see some good news and be like oh why isn't this doing anything for the price is because the market isn't that efficient markets will price in certain things especially if they're widely telegraphed like the ATF stuff right that's something that gets priced in relatively quickly look at what happened with the eth atfs you know soon as they got approved you had a

day uh of eth going from 3K to 4K with the BTC ETFs it was widely telegraphed for a long time uh that they were going to get approved and then you had that being priced in so but there's a lot of other things that aren't widely telegraphed there's a lot of other things that aren't well understood that many people don't see and they're not buying the assets because they just aren't aware of it right or they maybe they're aware of it and they don't understand the implications of it so that's why it tends to take longer to play out and one of those things which is the thing that I mentioned before was that uh one of the executives the black Rock's COO of ETF and index Investments said at a coinbase event that was I believe held today or yesterday that permissioned blockchains have lost and

that traditional Market participants are coalescing around open- source ethereum for tokenization so as not to fragment liquidity and I quote tweeted this and I said seriously read and digest this an executive at Black Rock the largest asset manager in the world is telling you that the future is public blockchains specifically that the future is ethereum if this doesn't make make you bullish nothing will now this also speaks to what I was just saying about the fact that this is not something that is typically going to be widely telegraphed right it's not like your everyday investor is going to hear about this this is definitely inside of crypto stuff uh and it's definitely not going to move the needle on the day right but it is going to move the needle on the monthly time frame on the yearly time frame because in the background you have

all these players doing different things to get this money into crypto to get this money into the ETFs once the E ETFs go live know the um black Ro and others are going to be going out to their clients and saying hey we plan to build uh tokenization on ethereum and this is why and you know here's all the other stuff that ethereum is good at and what what it's good for as I've discussed before so as I said just you need to zoom out here because these things are incredibly bullish but they're not going to be bullish on the day it's not like this news is going to send eth from 3500 to 5K in a day right they're are very very rare times where that will happen and obviously it happened with the ETF news but as I said because that is a

widely telegraphed thing within a day of that or I guess like pretty much immediately of that news breaking um I think on May 20th where essentially came out that uh the Bloomberg guys said that they're upping their ODS that the eth ETFs are being approved to 75% uh and the and the 19 B4 forms were were basically going to get approved and the market understood that within hours of that happening uh you know the eth price basically shot up because that was widely telegraphed to a lot of major players out there but these sorts of things aren't they just take longer to play out and also the money that's coming in as I mentioned the trillions of dollars that's coming in literally does not have access to Ether right now none of the money that goes into the BTC ETFs uh through the uh retirement

accounts that tradire money that we're talking about can go into eth right now and a lot of it can't even go into BTC because there's not infrastructure in place for that I actually read a thread uh I don't have it up up here right now that was covering the same coinbase event this event was basically a bunch of trifi people there explaining different things about uh what what their views on crypto are it was incredibly bullish by the way the event it's from what I've seen But essentially they were explaining that most of the money in the trafi world is is not even able to access the BTC ETF let alone the E ETF yet because the infrastructure is not there the the uh the kind of pipeline hasn't been set up and these uh institutions aren't uh marketing it to these these clients yet because they

just can't access it so you have years and years and years decades worth of trillions of dollars coming into um this asset class you know Ethan BTC to start but I'm sure other assets down the line here are and not only that money coming in but also these companies working with public blockchains now because I don't know how long all of you have been in crypto for but the notion that these uh I guess like corporates or these big institutions would build their own private chains and then just use that instead of using the public chains was very popular for quite a while actually for I I guess like the last probably 10 years at least it was a very popular notion but now they've basically capitulated on that I think Black Rock has definitely Led Led Led the the kind of cause here but they've capitulated on

that and basically said okay we're going to work with public blockchains it's just easier there's already standards in place you know there's so many devs that can work on that like the stuff that I mentioned the other day right uh and and there's so much liquidity already there it's it's Global it's actually decentralized uh which basically allows us to to build whatever we want on it there and it's permissionless so you you look at it from that perspective and you realize that it's incredibly bullish that they realized this now and that they're doing this but it also means that it's going to take time for this to build out it's not going to be a daily thing which means that it's going to take time for the market to price this in to digest it to essentially uh you know uh kind of come to terms of that

and and realize how bullish it is so as I said at the top there is no need to be bearish right now you need to zoom out because if you're looking at the day-to-day chart and say e price goes from 3500 to 3,400 over a day and you start thinking oh things are bearish it's like guys like that's random noise random walk movements look at the trend the trend is still up as I showed the other day that's all that matters a long-term Trend here and obviously if you're a Trader you're going to be caring about the day-to-day or even less time frame Trends and week- toe Trends that's completely separate to what I'm talking about here I'm talking about purely from an investor perspective and if you want to try and and play the dips so to speak and you want to try and buy

e at a cheaper price than where you got it from well sorry than where it is today and obviously you're taking on risk there and that's more of a Trader mindset than a long-term investor mindset a long-term investor basically buys eth or buys crypto assets in a DCA fashion where essentially they don't wait for this sorts of stuff because they know that they can't time it so they just DCA or dollar cost average in over time and they DCA out over time as well when they feel the time is right but I've said this plenty of times as well especially in the daily grade Discord Channel when I get into these discussions with people that investing is incredibly hard crypto tends to trick you into thinking that it's easy because you can see the gains come very very quickly but the thing is is that like it

it definitely a lot of the time is easy come easy go where essentially you get the gains so easily that you don't value them like you otherwise would have and then you end up trading them away over time as well you get greedy you know all those human emotions take over uh there so investing and being able to make a profit and a net profit over the over the longer term uh and being able to to achieve your actual goals like your portfolio goals is extremely difficult it is not something that I think most people will succeed in doing that's just the aim of the game I think the the market can't reward everyone right that that it's not a zero sum game uh and it's not like a negative sum game uh it is genely positive sum but the market can't reward every everyone equally you

not everyone can make millions of dollars off of putting $1,000 into an asset like not everyone's going to make a th000 X on things right um there's going to be some people that do that small handful of people that do that and then the most the other people will do is maybe they make like a 2X or maybe they make a make a 10x and then trade away most of it and it only becomes a 2X when they net it out so from there when you think about it like that and have that mindset you kind of understand how things are are are going there and what the real reality looks like there but hopefully that's a bit of a pep talk for you guys as I said I came into the classroom it looks like everyone was too bearish Uber bearish no need to be

bearish not at all I like I I and I'm talking about longer term Trend I'm not talking about day-to-day just longer term Trends I just don't see any reason to be bearish right now all right so an interesting eth research post that I came across today uh with regards to inclusion list so this one comes from vitalik himself where essentially he seems to have fixed a lot of the issues that people were having with inclusion lists now I don't know enough about about this to comment on it in detail because it is quite technical uh and you can see here the terms being used and the even the images um that that vitalic is used here I'm looking at this and I'm being like H I understood those words yes I understand the word public right so it's kind it's a bit like that and I haven't had time

to fully kind of do do more research into this I believe it was announced just today at some event um and then vitalic posted it 21 hours ago there's a few comments in the um the post here but essentially it seems like this has fixed the issues that were present with inclusion lists or at least the major issues that were present we may get inclusion lists included in Petra after all if the C devs and researchers agree that this is actually a good way of doing it so you can go give this a read for yourself the uh explain Lon Five summary that the eth research bot gave uh was this research explores a new way to decide which transactions get included in the next block of a blockchain instead of giving this power to one person or a small group it spreads the responsibility across many

people this makes it harder for any single person to control which transactions get included the method uses a clever way of breaking down and sharing transaction data so that no one can easily tell which transactions others are including so basically the entire goal of inclusion lists was to uh essentially eliminate as much censorship as possible at the uh transaction inclusion level so not at the attestation level which is a whole different thing that we've already got mechanisms in place for but at the transaction inclusion level and from what I've seen and the comments that I've seen people are very excited about this proposal from vitalic because it essentially uh does exactly that without the draw drawbacks of what we've seen in previous proposals here so yeah maybe we do see inclusion list included in Petra after all but you can go give this a

read for yourself I'll link it in the YouTube description below for you to do so all right so as you guys know the main I guess like theme lately um that that has been uh pre-confirmation and based rollups or at least those are the main themes that I've been seeing kind of going around so you can see here that uh Justin Drake tweeted out that they there was a based pre-confirmation uh infrastructure live on devet so this was uh I think at Zu Berlin I think there's an event going on right now and you can see here all of the different teams that work together to make this happen so I don't know if this is the first one that's live on devnet here but it's definitely uh one of the first and you can see like they're all very happy I

don't know why they're all wearing sunglasses U maybe maybe that's like a meme most of them are wearing sunglasses ins inside they're not outside maybe that's a meme there um maybe it means they're based I don't know uh but yeah I mean if you wanted to follow along with people building in the pre-com based shed sequencing space these accounts are who to follow so I definitely recommend going and checking out each of these accounts here but also uh Nicholas here from chainbound tted out a demo from the Bolta V1 devet illustrating a near future reality where users receive an inclusion pre-confirmation in less than 100 milliseconds via a trustless PBS compatible pipeline so in English terms this basically means that you'll get those pre-confirmation that I've been talking about over the past I guess like

few months now where essentially uh on L l2s uh you get to tap into L1 uh and use the L1 validator set but you don't have to wait up to 12 seconds for the transaction to be confirmed in a block you can do it at the pre-confirmation level and do it in less than 100 milliseconds which is the fastest out of any chain right now I think I believe salana currently does it every 400 milliseconds that's their block Times Obviously ethereum L1 is up to 12 seconds l2s can do it in 1 to 2 seconds um but I don't I wouldn't say it's like strictly equal to to these other things but I guess from a user-facing perspective this would be the fastest confirmations or I guess like we call you know the technically pre-confirmation or the fastest inclusion that they will get uh which is

huge especially because it's it can utilize L1 validators in order to do this which means interoperability at L1 so you can go check out the demo uh from from Nicholas here but also go check out all those accounts here that I I'm sorry that Justin Drake linked it's definitely uh something to to keep researching uh I think this is going to be the main theme for for a while to come all right so speaking of l2s blob usage has been trending up for 5 weeks now as rollups continue to see more and more activity so this comes from the um awesome dashboard from HBY that I've shown on the refie before and as you can see in the picture The Blob usage is almost at the Target so the target is three blobs per block with a Max of six blobs per block once it reaches the

Target that means that blob gas uh fees start going up it means that blobs are no longer free to use and that's exactly what we expected to happen I've said this before on the refuel where essentially we expected The Blob usage to go up over time as more l2s come online and as they get bigger and start using more and more blobs and then of course we can increase the size and or count of blobs and we also have pieras coming in hopefully q1 of next year when Petra goes live there but uh if the blob price starts going up again the base fee starts going up and the fees start going up on on blobs themselves then you will see the fees go up on l2s and I'm curious to see where that goes because actually uh we we are pretty much uh not

at Target right now but we have been at T we were at Target yesterday I believe and I can't think I can see the fee Spike here but if it's constantly at or over Target those fees are going to go up and if it goes even higher than that uh and and and essentially what happens is that the fees are just going to keep Skyrocket not Skyrocket going keep going up and up and up just like what happens on L1 uh then we need to either increase the size and or count of blobs to counteract this um and Implement pias as well but we'll see we'll see what happens here because there are ways for l2s uh or I guess like for rollups to use blob space more efficiently they may not post blobs as often as they are now if it gets too expensive as I've said

before there is kind of a really nice coordination game or shelling point game that these rollups can play where essentially they all don't want to be spending tons of money on blobs they'd rather not spend they'd rather spend the least out they can on blobs so maybe they slow down their posting here until blobs get cheaper uh but we'll have to see how that that kind of plays out there but I think what overall this shows is that L2 usage has not slowed down rollup usage has not slowed down uh and you can see that not only on um on the blob usage but you can see that on grow the p and L2 beit so I'll bring those two up here for you guys so grow pie you can see here uh if I go down yeah we're at alltime high for the layer

to user base basically even if accounting for this um outlier it seems here that was um that happened last month in May was we're at all-time high even if you remove that outlier um as of as of the last week uh and I think that's just keeps trending up now and on L2 be.com you can go to the activity Tab and you can see that we're pretty much at alltime high as well here as well even I mean it just spiked too so the scaling factor is is up there as well and the point of this as well is to illustrate that even though the market may seem relatively quiet right now across the board or has been quiet for a little while the l2s aren't quiet blobs aren't quiet and we're really still at the the beginning of the l2's road map for ethereum at at the rollup usage for

ethereum if you expect or if you believe that the ethereum rup Centric ver map is going to be the way that uh this industry scales and ethereum l2s and rups are going to get the the lon share of usage of any of the chains out there then it stands to reason that we're going to have a lot more demand for blobs and a lot more demand for uh for blob uh block space and blob space generally which means that we need to keep scaling up and because blobs are such a nice primitive we can keep scaling it up and we can keep adding more and more capacity which means that the rollups can keep scaling themselves uh keep scaling themselves up and we could get to that uh I guess like place that we want to get to which is essentially scaling to I've mentioned it

before you know trillions of transactions per day uh if not more than that and I think that's what we're going to get to eventually obviously most of those transactions will be done by Bots uh but that is just what happens on on you know on on in an onchain dominated world in onchain financial world I mean even offchain like in the trly world most of the transactions if you call them transactions I guess I'm talking about like high frequency trading and stuff like that on the stock market uh it's done by Bots it's not done by humans so humans will interface with these things but most of the transactions will be Bots but you need that scale for for the Bots because on a permissionless system you can't really filter that out right you can you can try and filter it out but then it

becomes a centralization vector and then it defeats the whole purpose of what what you're building in the first place or it defeats the whole purpose of a blockchain in the first place so I'm excited to see how that all plays out there but I'll keep you guys updated on that I think that as the market heats up from here and as more l2s and rollups join and start using blobs we're going to be at probably be at Target for a long periods of time uh because even though it's quite simple to increase the size and count of Bloods from a from a code perspective where it's like literally a single code change from my understanding it does require a hard Fork I think there was some way to do it in the clients but I don't know what way the research went on that um but it does

require a hard Fork but also it it means that the more load is being added to the network and I think the core devs right now do not want to add more load to the network they want to put Max EB in they want to get those valid that get get that validated count claps down to take that load off the network and then probably they' feel comfortable doing this but we could get a blob count and size increase with Petra so we could get that with Petra if blobs are at capacity long enough to justify it and if the cevs feel like oh okay well um you know these are at capacity and people really want this now it's critical let's increase it uh but it depends because pias might be that solution that we can use for the short to medium term in

order to alleviate that until we see the validated count collapse due to Max EB and then we could do a size and count increase in the next Fork after Petra which is I believe Osaka at least that's one of the the names of one of the the forks on the CL e side there uh but that's that's kind of my perspective on on where things are going uh right now all right so Bas announced today that they are working with ad well it's not really an announcement it's more of a teaser but they said here coming soon Adidas is based now we all remember some of these Brands getting involved with crypto back in 2021 in particular with nfts and it didn't really go well for them but I think that they've been working on it in the background for a

while and they didn't abandon crypto and they've been trying to find a way to do it that's sustainable that actually makes sense and that they can do that in a way where people don't have to pay you know high gas fees like did on L1 ethereum and now we're at the point where they don't have to do that anymore because we have l2s and and I think bass is very well positioned here as the I guess like cultural Hub of the l2s because they already have a lot of the crypto native culture on there and they do have those incredibly cheap fees and it does have the security of ethereum or it will soon when they Implement fraud proofs there and it's tapped into the ethereum ecosystem and all the other benefits that come with that and it has the brand too I mean Adidas can be I

guess like or can have confidence that they're safely working with a killer brand because it's coinbase you know Bas is is coinbase right so there's no I mean there's a there's probably a little bit of risk for them to do this but there's no huge risk they're working with a well and a well-run and trusted brand which is is really great for all of crypto so I'll be keeping an eye on what this is and what this looks like but yeah I just thought it was worth sharing because to me this is what actual adoption looks like not getting random big DC grade celebrities doing meme coins and you know now I see like there's a lot of um a lot of I guess like Stars doing meme coins too like for sure do whatever you want on chain it's a permissionless system but like I'm not

here for that I'm not here for people making coins of themselves and dumping on their followers like that just is disgusting to me to be honest and I really don't think that we should be championing that and promoting that and I'm very glad that the ethereum ecosystem isn't doing that uh and I think that if we want to scale to to the masses that's not going to be the way to do that that's not an on no that's not the way to onboard people the way to onboard people is uh to do things like this through cultural things through things that people actually care about and aren't just pump and dumps like I doubt Adidas is doing any of this to pump and dump right they're going to do it cuz it's you know they're tying their brand to it they want to get more

involvement with their brand with their products and services uh so I can't wait to see what uh what's happening here all right so superp seed has launched their test net now this is the first time I think I've talked about super speed super seed on the refill before so this is a new layer 2 that is doing a lot of different things things so I actually I should disclose here that I'm not an investor in suped uh yet but I did talk to uh one of the the founders about super seed and he basically gave me the um the pill about this and like what they're building here and there is a lot guys like I'm still digesting it of what they're trying to do here but I guess the simplest way I can explain it is they're trying to bring together a bunch of different

Primitives uh with with the layer 2 in order to create a very nice flywheel where essentially the layer 2 actually can be profitable and actually make money and the users that essentially are are part of that ecosystem can share in the the profits as well and it's not just through some kind of like dumb staking mechanism where you would stake the token and earn some kind of revenue from that there are multiple different ways that they're doing it but as I said I'm still learning more about this still digesting a lot of What's um what's going on here um but you can go check out their test net for yourself and obviously check out um what what um supered is trying to do in all the moving Parts here but I mean as I said I'm not an investor yet I don't know if I'm going to invest or not yet but I

figured I was it was worth disclosing that it's one thing that I'm looking into uh but I was really excited when I was talking to to to one of the founders about this because a lot of the stuff that he was talking about was stuff that I've been wanting to see done but just hasn't been done since like D5 summer basically bringing all those Primitives that we discovered and that we used during dii summer or just during the early days of defi generally bringing them together and and and essentially creating a superc composable ecosystem where you have uh a flyable effect going and as I said like I I haven't um dived deep enough into it yet to explain it like I'm five or anything like that but you should definitely check out this project uh if you haven't yet they've got like a they've got a website

obviously and they've got docs that you can check out about what's going on you know how they how they're doing things um and and what all the moving Parts look like here because definitely go check them out one project that I haven't spoken about before but should be on your radar uh I'll link this in the YouTube description below for you to do so all right last up here zapper an old OG project within the ethereum ecosystem has announced the Zappa protocol now you guys probably know that I am an investor in Zappa but fun fact Zappa was my first Angel investment or at least my first I guess like um uh proper Angel investment my my very first one was M stable but I I consider that to be a very different uh I guess time that was in like Jan 2019 and I wasn't like I didn't really

consider myself an angel investor back then so zppa was like I think my first proper Angel investment back in I think it was 2020 when I made this so uh yeah I've been following Zappa for a very long time now I've been following uh I've been using it for a long time I still use Zappa as my portfolio tracker tracker but they're a lot more than that now Zappa protocol is going to be powered by zap so they announced their token today as well but essentially the vision um for for zapper is to essentially illuminate onchain activity so they want to increase onchain literacy so that you could basically go on zapa and see what's happening on chain across various different kind of interfaces and wallets and and so on and so forth so the Zaba protocol aims to to solve this problem of of deciphering

what's happening uh through indexing uh through uh interpreting different positions through event interpreters so you can see here that essentially uh they already do this within Zappa where it's like you got this um this uh transaction that says did something with so and so you can actually click onto that and you can interpret what this is and that adds it to the collective knowledge base of the zapper protocol so that other people can come along and see what exactly what this is here so this is actually really good for security as well seeing exactly what's happening and not getting fooled by things uh but yeah you can go check out zapp's full announcement for yourself I'll link the thread in the YouTube description for you to do so but it seems like zap uh is going to be the token is going to be launched in Q4 of this year I assume

that's when the protocol is going to go live or at least some version of it uh here uh but yeah it's not too far away now you know Q4 we're already uh almost in Q Q3 here but yeah um as I said like this is a project close to my heart because it was my first real angel in in investment and it's been a while that I've been tracking them tracking what they're doing uh so super excited about this but you can go read about this for yourself I'll link it in the YouTube description below for you to do so um but I think on that note that's going to be it for today guys thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give you a thumbs up subscribe to newsletter join the Discord Channel and

I'll catch you all next week thanks everyone