DeFi By Design EP#111: Understanding Liquid Staking Derivatives & Validators

Transcript

[Music] going on guys welcome back to D5 by Design podcast episode 111 here today with our boy Alec uh snowboarder and weightlifter dude is jacked and um yeah we're talking today about how we are going to jack the world of LSD uh and liquid staking and ethereum staking yields through the roof I'm excited right now because we and I just spoke to a friend they're they actually received some of the arbitrum stip so uh they were they were telling us that Arbitron ecosystem is about to get super Juiced up we got Bitcoin going

to the Moon these podcasts have been different for the last 18 months I remember jumping on in the bull and it was like smiles and Giddy and just whatever and then in the last bit it's been how can we build and build better Tech and this and that the other so let's talk more about that and throw in some fun uh hints at what you guys are building uh Alex so good to have you on here Al hey uh great to be here guys thanks for having me and uh yeah we can have some fun while building doesn't have to be mutually exclusive totally Yeah man so Andy and I we're actually talking we were like hey like

we've got a full book of calls let's try to slim that down a little bit but then we hopped on with our buddy and he was telling us about like this arbitrum stip and kind of dropping a little bit of alpha so like there goes to show like still got to talk to your friends and I think I think that like the conversations have almost like taken a little bit of a turn here where like the alpha drop during the bar Market kind of like Andy what you were saying like the alpha drop during the bar Market was like this this like account abstraction or like this tool right and it's like this integration is going to level us up and then and then the conversations in the bull are like Obama Sheba enu 42,000 just pump 30% let's ape so like

how do we is that like I'm I'm kind of like reconciling that for myself as far as like balancing going from going from like pure heads down Builder mode about the tech to like few like full speculation mode is there like a middle ground there where like a little bit of speculation and a little bit of utility is the is the Right Mix or how do you kind of like reconcile the philosophy during the bear and the philosophy during the poll yeah um good question and so I've been through a couple of Cycles now this is my third cycle as like an investor second cycle as an operator and this won't be like news to your audience

members but there there's very clear hype cycles that come around or come along with this industry and Technology as a whole where a new innovation is delivered to the market or it's basically this breakthrough Innovation from the technology level and then you see the following six to 12 months a lot of hype in speculation around these new technology Primitives and oftentimes the speculation and the hype really outpaces the the pace of innovation that's truly happening so what you see is this really extended uh speculative environment we saw this in you know

2017 2021 and maybe we're approaching a new speculative environment but on the you know flip side of these really speculative bubbles you get these deep troughs and during the Deep troughs a lot of the speculators and the marketers uh kind of leave the market and maybe go back to their day job or go on to shiing something else where the builders stay and then they develop that next wave of innovation and I think that's where we are now we're seeing some really exciting products hit market and potentially it could lead to one of those speculative Manas once again and

to your question Robbie like where is the harmonious relationship between the two I think the timing right now is exceptional because if we are are at the Forefront of one of these new speculative Bubbles and we're leaving this kind of building phase what that means is we have uh tremendous technology that's being built and we're going to enter this wave of speculation where potentially things like incentive tokens that are being distributed for liquidity begin to have some value again and there's some speculation around those so it can actually bring more users and adoption to this this Innovation that's

happening but we could very quickly get into a a realm of speculation once again so I would anticipate over the next six to 12 months it's going to be a very high signal time where there's going to be great Innovation the builders are going to be you know building tremendous products and the speculators may still be sidelined for another couple of months so it's a good time to be in the market Mar right now let's just say yeah curious how how your uh your decision making from your past experiences with at uh being involved with the education Network at Ben as well as with sparex kind of came into

these types of of choices that you make now like for example Rob and I spoke to Luca uh CEO of pudy penguins yesterday in the Pod and we were talking about decisions that you make from a builder perspective as far as announcements marketing releases timing in these different phases and I think this is a really good kind of segue from what Rob's original question in that you know is are are those past experiences helpful in your decision-making now leading tender eyes to understand where you are in the market where the market is where the users are and like you know how the how different uh strategic moves will be will be kind of uh taken but by the market you know which will have like the greatest impact yeah for sure um um well I think

like high level you know during a bull market there is obviously tons of speculation but there is a ton of extremely high caliber Builders and entrepreneurs participating in the market so it's just an extremely fast pace like you know a week people joke say like a week in crypto is like potentially months in the real world and that's just like even further emphasized Siz during a bull market so when you're uh building in a bull market often times you're fighting for attention and there's a lot of uh Capital that's in the market but it's

oftentimes very fleety Capital it's not very sticky capital and you have to always be fighting for the attention of the market participants where when you're Building Products in a bare Market you get to have much more of an intimate relationship ship with your clients and your clients are often times long-term multi-year partners that are using your protocol uh as an integral part of their business maybe they're actually integrating your protocol into their service offerings or they're building new products on top of your protocol the conversation is much more strategic and aligned and collaborative instead of effectively

fighting for uh this kind of like super quick feedback loop attention through crypto Twitter um like crypto Twitter is a lot less relevant in the bear for for Builders because you can just call up your customers you can call up your partners your collaborators or hit them up on Telegram and they don't have 500 messages that day so they can actually reply they can hop on a phone call with you um so instead of being like constantly trying to engage your community like the or like in the bul in the bear you can kind of focus on product really hone in your communication and effectively talk with your customers before shipping product

you don't have to test and prod like you may have to during a bull market interesting I agree yeah bull markets you don't even have time to think really like by the time you have like a new comms strategy if you don't push it you know the whole Market has moved on to a new topic that they're interested in so like you have to be on your game during a bull market during the bear you can really just focus on owning and on the product so it's for for True Builders it's a refreshing environment to be in a be Market a bull market is too high noise and everyone's trying to grift one

another out of their shuckles yeah we also see the the the effect of bare Market on Builders tends to create infrastructure and tooling and then the effect of the bull market is is Builders tend to create these ponzi's these flywheels these these applications on tops of the networks using the tools that are built during the bare market so if you had like a piece of advice to share with builders about like how to how to again kind of like cross the chasm from bare Market to

BU to bull market how do you yeah what what do you suggest to to Builders out there whether they're maybe like builders in your own company at tender eyes or Builders out there in general so the question is dealing with the transition like the changing of Seasons between barar and bull yeah and to to even further that context like I grew up in Florida where every there's one season year round and there was there's not much up and down it's all kind of like a steady flow but in the in the market there are very clear seasons and cycles and that can almost like be a jarring change and shock people like

from when you go from one phase of the market to the next so how do you help smooth over that transition yeah well there's something really important to note that startups don't go out of business startups run out of money okay so um most of the time startups are just fighting to find product Market fit finally once they find product Market fit they can have substantial recurring Revenue then that recurring Revenue can actually fund operations but until they find product Market fit you either run out of cash or you don't and in Bull markets it's really easy to e do a public sale do some type of liquidity generation event or go call up Venture capitalists and go

ask for an extension of your Runway to pay salaries but in a bare Market that's not so easy obviously and the bare Market will always last significantly longer than you anticipate so say you want to raise I don't know $3 million to fund operations for three years years you can't expect that to actually last three years I would cut your Runway down by 50% let's just say um so just back then napkin ma the bare Market is always going to be longer than you anticipate and your burn rate is always going to be slightly higher than you forecast just because it's expensive to

hire really quality Engineers business developers and those with relationships in the space so manage your cash you will run out of business and you might say it's a protocol with a decentralized community they'll just maintain it via contributions to the open source code I appreciate your optimism and I like you know respect you being so hopeful but if you're not incentivizing individuals or a core team with a recurring salary they're just going to stop working so as a leader of your protocol or your Dow ensure that you have operating Capital because very quickly during a bare Market as you transition from a bull to a bear people

stop believing that the pie is going to grow so instead of being collaborative and uh with this mindset that a rising tide will rise All Ships instead they start trying to piece up the pie instead they start talking about dissolving the doubt and distributing assets and you just don't want your community or your core team to be then spending all of their time on thinking about how you wind this thing down when they should be thinking on how do we push the gas even harder how do we make it through this bare market and really get actual product Market fit on the opposite end so transition transitioning from Bold to be buckle up it's going to be a hard Road and ensure that everyone

is you Ure you have adequate Runway and then as you enter from uh the bear to the bull market my advice would not to be to overhype most of the time your core team only needs to be five or six individuals I love bringing up the fra ecosystem because Sam kaisman and those Legends over there have been pumping up the whole ecosystem with like five Engineers now for over four years and their protocol peaked at like two over two billion dollars last last cycle like absolute Legends most companies will over hire too soon and no need to focus on headcount objectives rather think

about where you want to be from like an operational standpoint what you want your people to be doing and then hire in accordance don't just hire because you're optimistic about the token price or anything like that and then what else uh operate this thing like a real business uh it's very very simple you have Revenue in and you have expenses going out from the Dow perspective your Revenue going in or any fees you charge and your expenses going out are the amount of tokens that you give out in admissions it's very simple make your Revenue more than your expenses and if you're going to be burning more than you're bringing

in understand that what you're doing is effectively uh digging yourself a hole that in the future you'll have to get out of so as soon as possible try to get into a effectively cash flow positive position where you're bringing in more Revenue than you're paying out in the market value of your tokens in each plug so it's a real business that we're operating yeah finances are important yeah there's multiple points here that I want to reiterate taking all the way back uh to to the fact that in in the bear or in the bull these tokens end up having more speculative value again which gives you kind of more more flexibility um you know another another

really good point about just kind of having to having to have the weath to not uh kind of make the the wrong choice at the at the right point in the market it's almost like like in trading where when you want to sell it's the time to buy and when you want to buy it's the time to sell it's almost like when you're going from a bull to a bear you you you don't want to have to be faced with this kind of you've got this collaborative Dow structure of kind of you know contributors Here There and the other who are just kind of helping out because they're all flushed with cash uh really you want to be kind of flooring it on um on on on a more concrete set of core team you know with with a a solid incentive structure and then similarly

when when we're getting to the bull you don't want to have to scale too too hard and and like you know prioritize growth growth growth growth growth at the expense of of kind of like look looking at your actual bottom lines and saying like you know like are we making any money here um you know yeah we can raise more but if the bear comes sooner than we expect then we're going to have to do a lot of cuts and different types of of uh of of changes and then finally you know the the point on on okay we need to basically h building the bear to be able to Excel on the bull and I'm a big believer of that and again something that Luca was talking about yesterday is like we can't just wait for the bull like in the nft community specifically

and same thing applies for defi we must kind of build there build the technology uh and build what what people would want um to be able to uh you know get to that point obviously we can spice it up with things like this arbit Grant and other types of yield uh initiatives to kind of put some fuel on the fire but ultimately this these grants wouldn't be possible without protocols like like tenderized like others GMX Etc on uh you know who have built through the bar speaking of of that you guys have just enabled liquid staking on any validator uh recently a couple weeks back now I'd like to kind of start at a very barebones level as to your perspective on uh how liquid St staking and ethereum

validators uh you know kind of collaborate and are uh in unison so why you kind of uh have this focus on validators and then we can dive into more so of what you guys are doing so from more of like a base level and a technical level you know what is the relationship between these validators and liquid sticking derivatives how do they intertwine what are kind of the sacrifices trade-offs um and different kind of parts to that puzzle yeah this is a a dynamic landscape so let me try and answer your question best I can um so high level um when it comes to like a relationship between liquid staking

protocols and validators most liquid staking protocols today if not all uh select a pre-specified subset of validators in Lio one of the industry's leading liquid sticking derivative protocols they have 29 different validator partners uh so when you use their protocol your stake is distributed evenly across those 29 different validators other liquid staking protocols May select 10 validators maybe they'll select the top five validators either way these like liquid

staking protocols always are selecting a subset of validators and then creating one liquid state token that is effectively an index of those various of the stake on those various uh nodes so you can think that the performance of this asset is now an aggregate of the performance of all of those different notes this works really really well for the defin native individual one who just wants to go to Unis swap or curve and swap their eth for whichever index is most liquid on on curve or on unit swap they just want

yield on their wath They Don't Really Care where it stied to right this is uh a wonderful phase one or version one of liquid staking but if you look at the tvl it's it's clearly pretty big it's around $16 billion dollar today but there's another subset of the market that really wants to use Liquid staking but is actually neglected from participating in liquid staking because of this notion of the liquid staking Solutions today being an index uh so there are two really important user groups first is the app Home Staker who runs their own Hardware in their

basement they are sophisticated ogs and they know that they can run their software and they won't screw it up very simple so they want to stay stake to their own Hardware so this notion of having an index of 29 different validators doesn't fly for them because they want to keep their stake on their hard and then there's another user group which are people that are staked to staking service providers think of like the figments of the world or coinbase so this could be retail or it could even be like a big regulated institution either way there are people that prefer for whatever reason whether it's regulatory or just their preference they prefer to stay staked to the

staking company of their choice okay so now both of those user groups can actually use the tenderized protocol to enjoy liquid staking but the state stays siloed to whichever validator that they pick so if they're like a large regulated institution they get to stay staked to their compliant staking partner or if you're an at home validator like Andy if you're running some Hardware you can spin up a liquid version of your stake on your exact node and then go enjoy the liquid saking ecosystem and we can get into like you know what are the major uh strategies or like the popular

strategies we're observing but yeah that's high level most people have these indexes and it's good for defi users but it actually leaves the institutions or the at home Staker in the dust and now tenderize exists to service those uh those neglected user groups and what's funny is those neglected user groups make up$ 45 billion dollars of capital today where the liquid staking derivatives only make up about 16 billion so it's not this like small subset of the market we'd actually argue that the liquid staking derivatives today are fighting over the crumbs where the real meat of the opportunity are

these in institutions and at home stakers and that makes up 45 billion dollars worth of Stak eat today and these are this is eat that's already staked it doesn't have to enter the market it's already staked and now with our protocol they could spin up a liquid version of their stake yeah I think is the is the well first I I appreciate the broad explanation I think that the main the main takeaway there was that there's there's a a select few uh basically no that are being that are getting more value than the others because of of these larger protocols choosing them uh as their as their quote-unquote index as you say and that and that these end up

with more me with higher yields and the others receive less now is that a is that a a preferential treatment is that a centralization problem is that just a who has better Hardware like free market kind of situation like how does that situation arise and then yeah let's dive deeper into how tenderized is then uh you know giving the the those who don't have this preferential treatment uh an advantage and kind of how that works yeah for sure um I don't think it's an it's like a um situation where they're getting special treatment it's really just a a market phenomenon so you know the most liquid solution in the market that's the

most liquid on curve can handle the most throughput and it can handle the most volume so if you're an individual with $5 million worth of eth and you want to swap it for State de you just simply need a pair that can handle a $5 million swap without subjecting you to significant slippage so it's not like the users of Stak te today are like you know prefer the 29 that support state deth rather state deth is just liquid on curve and they just want to go grab whatever's liquid on curve um that's fine but for these much larger more regulated institutions or sophisticated actors

that are staking in their basement uh there's no ability for them or no just no way to justify uh using one of these indexes because you may suffer reduced yield or if you're a regulated institution you may have a contract with a staking service partner that you're going to use them for your staking services for the next five years sometimes even longer uh because there are these real in-person business relationships uh so when it comes to that kind of neglected group of capital um or you know the users of State de today it's not because they really love the 29 that are supporting Lio it's really just the fact that Lio

exists and is liquid um now you asked what is what is in it or okay how do I friend this up like what's in it for the staking companies that are currently using Li and why maybe would they want to engage with tenderette um let's just use a company like lugan noes so lugan noes is one of our launch Partners they offer staked madic they have over $400 million of clients Capital staked to their heart Ware okay that's their competitive advantage that they have $400 million of assets under management so they work

with groups like Lio to bring on to bring in more Capital to their or more stake to their Hardware but when it comes to their $400 million of current delegators or current assets under management these index style Solutions don't provide any value to the current stakers of lugan noes simply because lugan noes will never promote Lio to their current customers because the second that current customer un stakes from lugan noes and mince their Lio version of their liquid Stakes mtic their the stake is removed from Lio and it gets distributed across the various

nodes that are validating uh the Lio infrastructure so the competitive Advantage for these staking companies which is their assets under management they they don't want to work with Lio to service their current customers because they'll lose assets under management but with tenderize what they do is they use our solution as a wh labeled experience and instantly their current delegates or their current assets under management get to enjoy liquid staking but lugan noes doesn't lose any of their assets under management so so it's it's not a conflicting you know we're not competing against or extracting any tvl from them

but rather activated assets that already exist so we can work harmoniously with Lup and we can partner with luga noes and they can partner with us and they can partner with Lio and all it's going to do is increase their delegations and offer liquid stick into their current delegates so it's not like this uh experience where they have pick us or Lio per se they can work with both of us you mentioned how tvl is the competitive Advantage for for staking providers uh like Lio um and that's almost how they arrive at

product Market fit maybe there's an inflection point there uh I would argue that that the liquidity is the is the most for Lio and then AUM is the mo for the staking companies yeah I just wanted to parse that apart okay and and then how do you how do you kind of like unpack product Market fit is it different between the staking infrastructure providers and the staking companies themselves like what is product Market fit look like for Lio and then is that the same or is that

different from like what product Market fit looks like for tender eyes I think product Market fit you know for for Lio and some of those index products they've already proven that they have product Market fit for the the dollar that doesn't need to bother with kyc for the dollar that doesn't need to bother with AML um maybe the dollar that prefers to be a dark dollar someone who's doing G you know Geographic Arbitrage uh is trying to avoid regulations I.E a lot of defi users today Lio is a perfect solution for them they can sign on with their VPN they can

go to curve which will never be Geo blocked and they can buy stake de no one has any idea who's holding it no one has any idea who's interacting with the cool it's radically decentralized this is great but not everything needs to be radically decentralized right so when it comes to product Market fit for tenderize versus a Lio Lio has their product Market fit with all the dark Capital all the radical D gen andon characters they're already using Lio and they hand but there's this massive massive pool of capital $45 billion versus the 16 billion currently with liquid Stak this

$45 billion which is staked Capital but not yet liquid there is no product Market fit for them because they are barred from using liquid staking so tenderize product Market fit for us looks a lot more like onboarding those regulated institutions or onboarding those High Networth at home stakers into liquid staking and the cool part about this is we don't have to convince them to go buy eth or convince them to use some obscure new index protocol but rather they get to stay staked to the hardware they're already staking to and now all they get

to do is enjoy the benefits of liquid staking like borrowing collateralizing lending um so they don't have to get past the mental hurdle of like you know what is this new protocol what are the various nodes that are supporting the protocol they've already done that they already spent a year plus working with a staking service provider to cut a deal you know so for us all we have to do is activate that already onboarded Capital so product Market fit for us is onboarding those validator specific users that demand risk to be siloed and it's a little bit different than the user profile of the yield Maxi and like I guess you could say the the defi Wild

West Maxi which is a lot more there's a lot of different requirements let's just say than like a US regulat F I mean I mean you touched on the 45 billion that's and that's what we touched on on the space last week was that that large that was like largely the conversation was basically what I was trying to get at a lot of the questions was there's this big bunch of capital that effectively is not being staked with your protocols yet how do we do it and a lot of the answer was risk tolerance and lack of awareness and education but I think there's a whole another subset of capital that you guys

could be appealing to which you kind of touched on a bit which is outside of this 45 billion that's already staked while it's easier to do sales and marketing to a a collection or a market that has already sold on the idea of e and e taking there's also this massive Market of this institutional Capital that's slowly getting the green light with the Bitcoin ETFs and eventually an ethereum one and slowly getting opened up to where you guys can position yourselves through your staking Partners as like their their go-to kind of uh protocol to use right so where where you can have a big Edge is is if you know instead of just focusing on this dark Capital you have these good relationships with I think you mentioned like figment for example or XYZ other potential partners where they have uh Mr

Saudi Arabia Giga whale who's kyc in AML somehow who knows how that happened but he's legal and they brought this guy in with 100 Mil and all of a sudden it's like yeah we'd like to put half this uh to work with you guys I mean there's no marketing that you guys had to do other than establish that relationship so I think I think that's a whole another batch of capital that that is waiting to enter maybe doesn't need that doesn't know that they need this yet but eventually with more speculation cycles and more time they'll eventually feel that need and you know there's there's a chance that you guys might be able to fulfill that in addition to the other batch that is already staked but not yet liquid no great Point Andy uh so on that note

like because because St is so liquid on curve and because most of the users of defi today are kind of those like an and ogs that still actually somehow have Capital after this you know multiple boom and bus Cycles um that is kind of the reason why we're having the centralization with State deep because the primary user group today that still has any money that's still transacting on chain are these kind of radically non kyc and in characters but as the bull market returns we're going to see a lot more Market participants that are more

Normy uh or maybe want exposure through a regulated vehicle they'll have Partnerships with staking service providers they will not be partnering with a decentralized protocol so as you mentioned uh these regulated institutions will have a a preferred staking partner and as we are already laying the groundwork with infrastructure deals with these staking Partners the staking partner gets to accept this capital in a hyper either regulated um but it doesn't have to be regulated I just want to make that clear um they get to accept their partner's capital in a trusted staking relationship and then on

the back end they can offer their users the ability to spin up the stake and it can stay staked to that one individual piece of Hardware so maybe as this new capital enters the market they won't want to use an index style protocol in said they'll prefer a stake to their preferred staking partner and the implication of this is maybe we could actually end up reducing some of Lido's market share and this this like fear-mongering around Lio owning too much stake uh we can actually counteract that PLL phenomenon not by asking them to self-regulate because that's the most

ridiculous thing I've ever heard in my damn life asking a business to stop accepting customers is just stupid but instead what we can do is provide a vehicle for these new dollars that are entering the market to stake to their preferred staking partner and still enjoy what Lio can offer which is liquid staking but you don't have to give it to Lio where they're already managing 32% of the stake instead you can stake it to your preferred provider or stake it at home and then use tender to spin up the liquid version of your stake borrow lend do whatever you'd like to do in the defi ecosystem and these are all parts of what's coming with tenderized V2 here here shortly you mentioned like tender

Swap and a couple other uh let's say Capital efficient uh options that users could have yeah totally um would it be helpful to give a quick overview of kind of like think so yeah so yeah so we have uh Three core products the first one is tender vaults that's where where any user can go to our front end which is app. tender. me and you can select which validator you would like to stake to and then you can spin up a a a tradable version of your stake on whichever Hardware you selected okay that's

wonderful but now what the hell do you do with your Stak you just send it to your buddy like sure but there should be more opportunities and more strategies for this new derivative and the first use case uh is powered by our new decentralized exchange called tender swap tender swap is a public shared liquidity pool that is designed so anyone that spins up a liquid stick derivative even on the most low liquidity piece of hardware on that Network so say like you're at home state you're doing eth and you literally spin up one eth of like Andy s you can route that one Andy St eth through our shared

exit pool of eth and you don't have to bother about making your own market so it's really really powerful because all these longer tale Assets Now have instant liquidity thanks to our shared liquidity pool you don't have to try to compete against like State D on curve because you probably won't ever get to the same liquidity levels and then we have our third and final product which is uh called beef bank and beef bank is a new uh liquid state derivative back stable coin so what this means for the end user is that you can post your uh liquid state position as collateral and then you can borrow stable coins against it so you

can either borrow stable coins to earn a little bit of yield on those stable coins which would boost uh the yield of your state position uh you could buy more Stak position with it this would be like a leverage long or you could sell Futures and go short and do like a delta neutral play but uh moral the story you can wrap your stake with tender vaults you can sell your steak instantly with tender swap or you could borrow against your steak by using beef Bank it sounds like recreating the entire defi universe inside

tenderize yeah it is it is a whole LSD ecosystem like when we talk with our partners we say look you partner with us and we're not just delivering you liquid staking we're delivering you an out ofthe boox whole LS defi ecosystem where your clients can borrow against it they can lend their stake you know they're not going to be like just wrapping their stake and then waiting for new use cases uh we're going to bring them all right out of the box and and we're just very very excited about delivering this for some longer tale assets you know it doesn't have to just be for stte through AIT but rather you can offer new cdps for some of these longer tail assets and

do peer-to-peer liquidations we're a little bit in the weed when we're talking about our liquidation engine but either way there's alternative approaches to liquidating stable coins to ensure that they're still stable and you can still offer very High loan to value uh lines of credit against some lower liquidity assets so super stoked to be offering that to some of our staking Partners here that and by the way I'm talking like our main Net's already live um by the time this comes out our V2 test net will be live but we're still about one month away from our main net launch just could you yeah looking forward to that yeah yeah definitely

time time is ticking uh time is ticking could you explain a little bit more you touched on it briefly just now but could you explain a little bit more around the thought process of starting your V2 with these longer tail assets what why did you choose to incorporate live pier madic and GRT and not focus on eth yeah so we wanted just to wedge our way into the market with some of these long R taale assets kind of prove out the concept before tackling e with like the massive I guess overhead and competitive landscape that currently

exists in e um and we some of the tenderized core team members uh used to be senior protocol leads at live Pier so uh and we actually operate some live pool video mining pools so we're live Pier video mining pools so live Pier was an absolute no-brainer and we also have a very close relationship with the graph foundation so we are also shipping liquid Stak GRT the asset that you know Powers all the various subgraphs that are powering all of our def5 protocols and then we're also going to Market with madic uh and we have Partnerships with all these various foundations and these

foundations are super aligned with our launch even providing tvl uh to the campaign so with those business relationships you know it was a no-brainer to first hit Market with some of these longer tale assets and then once we prove out the model and have the relationships established with our staking Partners it requires nearly no additional BD effort for us to activate etherum because we're already going to have the business relationships established with our 25 launch partners that we already have and almost all of them also have e staking so once we activate e staking in January of next year um we already have this network of effectively Business Development reps

that are going to be advertising our service offerings but it's all branded as a white label liquid staking approach for these these companies so uh we will be tackling eth in January of next year but we wanted just to kind of wedge our way into the market and uh solidify our business relationships with these staking partners first with long retail assets that differentiates them and their product offering and once we're wedged in and we have a little bit of a proof of concept going on mayet then we'll drop the uh e stake in January yeah there's less competition there and you could effectively go to any yeah any proof of stake uh token too you know

theoretically right yeah yep and the easiest ones are ones that have delegated proof of state right off the bat um because then we can just operate at the delegation level and then we can we could literally deploy a new Stak asset for a dpos chain a weekend so we're already talking with a couple other chains including nosis chain and some ZK Partners um to already begin looking at some next steps as to new assets that we want to on board right after there after epic yeah I think Rob can share this similarity that we're excited to see how this how this launches with testing it um and we didn't even touch on the uh expected rewards wink wink for

participating in testet as well as midet so we'll just leave that here for another episode coming soon in a couple months maybe do another pod q1 and uh chat more about how things have gone so um as far as wrapping this one up Alec thank you for your time uh and for sharing insights uh for for uh all Builders and users alike uh for liquid stakers uh for people who are interested in uh in tenderizing in this industry of getting yields on ethereum as well as other assets um it's been it's been a pleasure I look forward to seeing testet come out here shortly yeah thank you so much guys always a pleasure chatting with you guys and look forward to talking

again