DeFi By Design EP#49: The Next Wave of Web 3 and DeFi: Privacy

Transcript

[Music] d5 slate team [Music] what's up y'all real quick if you like the d5 state content on twitter and youtube and sub stack please please give us a like and a subscribe on this video on youtube and join our channel join the community we'd really appreciate it we're pumping this stuff out for you all as much as we can and we really enjoy the support and the community that we've built thank you very much enjoy what's going on guys welcome to episode 51 of the d5 by design podcast here today to discuss all things privacy in d5 so if you've been using d5 the last few months few years

you know that on ethereum everything is public and everybody can see basically what you're doing if they get the slightest hint at one of your wallets um you know we have a few a few protocols now like tornado cash that offer kind of a um a streamlined privacy service but we're really looking to get into defy uh privacy in in in this conversation so some of the things that i'd like to go over are you know and for us to learn and for you guys to hear is what can we do now to to be more private with our ethereum addresses in d5 how can we kind of keep our our funds our movements to ourself you know kind of what can we do now what secret network is is building out as

well to kind of help enable that for us and overall how how we can create a more privacy private and um you know still open still a transparent ledger but a more private marketplace you know kind of that of a a savings account that you have that you know you know your uncle can't go and find if he has your theme address so i'm curious to learn more about uh how we can stay private with the current technology today and then how secret network is also going to bring in some more privacy tools so uh turn it over to robbie and um yeah the markets are mooning yeah so it's uh september 3rd everything's looking green um and yeah i'm stoked to be here talking with tor and uh getting

into secret network i'm not too sure about kind of the inner workings but ultimately everyone wants a level of privacy to certain transactions um so there there's demand for a private um defy really and uh i'm keen to learn how this works um and and kind of like andy said you know there's there's these routes and these uh different blockchains that are now being built by some secret tech secret uh technology so i'll pass it over to tor for a quick intro and uh kind of let him get into it and uh yeah what's going on man what's going on guys it's good to be

here uh i'm tor i'm the founder of an entity called secret foundation we're one of the many many organizations that support secret network secret network as we're talking about is a private by default blockchain it's not what you think of when you think of privacy in blockchain usually usually people are thinking of monero or zcash and private transactions but it's not a privacy coin secret is a is a privacy platform and everything operates in the network with encrypted state encrypted inputs encrypted outputs which gives developers and users a ton of control via viewing keys and other functionalities on what's private what's public to whom and when so we'll definitely get into like the

importance of privacy but we should still keep in mind the importance of transparency as well like web 3 one of the best parts of it is it's auditability it's it's decentralization so our view is not to create you know the black box of of d5 where nothing gets in nothing gets out what it is is to reestablish control in the hands of the users whereas in public by default defy it's usually miners extracting value from the chain or it's the biggest whales in the world like splashing around running over like the minnows and the whales themselves want to protect their own privacy so just having privacy inherent in these systems is a great way to benefit the small users and the big users simultaneously so we do believe it's the future of not

only d5 but all of web3 to go private by default yeah it's an interesting contrast um between these the concept of transparency and privacy in in d5 um you know one of the biggest marketing for ethereum and blockchain is you know this open transparent ledger but now you know a year or two into building and using d5 protocols you know we're starting to see that oh okay well maybe we do want a little bit of privacy in our in our transactions yeah i would hope that people started to see it i mean it's just a weird world because if you look at the way things work in the real world like you said your uncle doesn't log into your bank account all the time and forget your uncle like your uber

driver or your neighbor or a stranger everybody who has the public address who can associate it with you and with nft is pretty much everybody's talks everybody can see what you're doing with any address on the chain and that wasn't like a design decision to say this is how commerce should be i think most of commerce historically has been based on some understanding of access control and privacy i want to exchange something of value to somebody else but only to that person in return they will give me something of value but only to me in fact all of public private key cryptography is based on the idea that a private key is what entitles you to access and ownership of these assets and yet people grew super comfortable in web 3

early on just because this was the initial design of blockchain that everything was going to be public to everyone by default and i don't find that to be a particularly sustainable model but it's certainly a model that can attract trillions in value into the ecosystem and already has so i'm not going to sit here and say without privacy this can't grow because it certainly can but can it be sustainable and can the right people win can it really be democratized can we build the applications that really should exist instead of just you know whale games i think you need privacy for that and i think that's the next phase of web 3 and for d5 yeah the the openness of finances isn't really something that fits into the culture that uh kind of as it exists now that that was

kind of a new concept of commerce um so fitting it more into how things work making it the the transition from fiat to crypto easier um is you know it is changing culture is going to be going to be something difficult so if we can fit into what is already pre-existing then it'll be easier to adapt and less friction so what on the ux side is really different kind of what are is it just the addresses that are obfuscated and you know is there other aspects of privacy could could you just give us an idea of that yeah for sure so ethereum is an l1 chain right it's its own layer

one it has some layer twos then solana is a layer one chain near is an l1 chain all these like there's plenty of layer one chains but they're all public by default so you get very similar user experiences on all these chains there's a public block explorer you go in there you're going to be able to see every single token balance you're going to see the entire transaction history all of that public to everybody by default with secret network things work a little bit differently and this is by design because of the private by default mechanism there's some aspects of the chain that are public by default which is the native coin so if you send secret around the network secret itself as the gas of the network those interactions are public on chain

but if you're interacting with applications and contracts on the chain those interactions are encrypted and only viewable by the person who is controlling that address that's interacting with that contract so to make this an analogy that's helpful in the ethereum world eth has erc20s in the secret universe we call them snip 20s so they are effectively the same sort of thing a token contract deployed on secret network as opposed to a token contract deployed on ethereum on ethereum you go to ether scan anybody's wallet you go you look it up oh here's all the erc20 balances here's every single transaction they've done with that token to every other address for the rest of time right most addresses are interacting with contracts

well i don't want to say most addresses but if you're doing something interesting with ethereum you're not just sending eth to a friend you're interacting with applications so on secret you would open up a block explorer you'll see somebody sending secret around the network you'll see them staking secret voting on governance proposals things that are designed to be transparent but when they interact with a smart contract you'll only see that they executed that contract so you can see that a token contract might have been interacted with but you can't see if what value was sent by that token to what other address that's encrypted viewable only to the user or if you want to go and look at their interaction with an amm built on secret network for example you'll see that they interacted with the amm at that address but you're not going to see on the block explorer

the exact nature of that trade all right so this has some really interesting consequences gotcha so you wouldn't see the price or the amounts um on like an amm swap uh and and that gets into some like they're over on on some of these other uh dexes main nets and and other networks um right the concept of front running back running and right and kind of just like beating someone with a punch when you can see the trade that they're making you can up the gas price you can get in you know and and make that trade beforehand so this is a i definitely want to talk

about that if that's where we're going uh well i'm curious kind of on your i guess on your position on that because in one sense if you can it is a market inefficiency right to yeah to if it can be a trade that's i guess taken quicker um someone ex can exploit that that spread so you know that that's kind of arriving at a uh more efficient price discovery but at the same time you're i mean it's kind of unethical it's kind of just cocked for the other person that thinks they're going to make this trade at a certain price and then they're not because they got b yeah from an ethical perspective

i i mean i i got my start in my career working as an options market maker and we were a high frequency firm and there's plenty of discussions about like front running is like pretty explicitly illegal in the real world what what they define as front running where crypto's kind of getting away with it is what we call front running doesn't necessarily adhere to the traditional definition of front running just like the way that exchanges are built in crypto don't look like traditional exchanges traditional exchanges don't work like amms they don't have pools they don't have lp rewards they have you know order bit order book based texas that's the that's that's like the equivalent in the real world is an order book so when i think about well go ahead just to add just add to that real quick there there is

the i think the parallel that we can see is i don't when wall street became more high frequency they moved all those server farms to new jersey like like way closer to new york i forget the exact location but just so that they could you know have their servers closer to the executing station and it was just you know the electricity going along the wires the wires were shorter so yeah we're we're seeing some something similar like with um i guess the the proximity that someone has to a node someone has to like the actually executing this um transaction they can just send in their order quicker similar to shortening their

wires um or like bring their servers closer to wall street right so no that's that it's a it's a good analogy the one place where i think it's it's a bit weird is because of the intent of the system wall street was never intended to empower main street right and the narrative of wall street has never been these high frequency trading firms and goldman exists to enable the common consumer that's certainly not the perception it's certainly not the marketing and it's you know it's certainly not the reality the reality is it's a bunch of pirates you know trying to capture as much money out of the system as they possibly can web 3 was supposed to be a decentralized more democratic financial system for for everyone right that was you know i say

web 3 because that's what i prefer to call the space a lot of the time but it's sort of a weird phrase to use because you know you could also just go back to the inception of bitcoin and it's baked right into the bitcoin blockchain the whole point was to create a better more democratic more universal alternative to the banking system which was failing so when i look at where things are going in the crypto space now and i'm like oh yeah it's just like the banking system that's a bug not a feature we don't want it to be more like that we don't want to be really drives more efficient or sustainable price discovery we have tons of boom bust cycles uh in the crypto space as it stands it's not like we've reached stable markets to any stretch i think a lot of the stuff is actually

exacerbated by med by minor extractable value so to take it back to like how to secret kind of approach this and think about this because contracts on our network have encrypted state and because the way that it works is if a node in the network is processing an interaction with the contract that is not viewable even to the node itself so there's no way for the node to go and front run that transaction in an amm they literally don't see it it's encrypted from the node itself inside the trusted enclave so when we talk about building those kinds of applications on secret we say that they're front-running resistant by design by default you don't have to have a lot of what's being designed in each to get around the front-running or mev problem are things that i think are actually

just going to lead right back into massive centralization and eventually eth is going to be you know suffering from even worse centralization issues than it already has every blockchain to some extent secret included suffers from some form of centralization issue especially in its early stages but when the entire blockchain is designed public by default and there's sort of this gold rush to be cl as you say instead of closer to wall street servers but closer to the miners and all the friendly to regulators to say nobody in the network can that we can support so i one thing i try

to do with education around privacy and defy is to say people take this assumption that like privacy and d5 is going to not be friendly to regulators because monero has been unfriendly to regulators or whatever else transactional privacy has this idea of being used for illicit purposes but how the financial system actually runs the applications that are being used for decentralized finance if they don't have privacy protections you're exposing the pii of all of your users you're exposing their entire transactional history like exposing a bank account to everybody you're doing things that in the real world would get you fined billions of dollars and then you're front running them like i see it completely the other way that without these programmable privacy protections we're not going to have a sustainable defy ecosystem that can interact with the real world and eventually people are going to catch up

to that way of thinking about it but only after they've stopped thinking about things from that negative light just because that's the way that the the media has often covered it in the past doesn't mean it's anything close to reality there's yeah there's two pieces in there it sounded like centralization and regulation um were kind of the the two um just pain points of of ethereum mainnet and these other public uh kind of opposed to to secret um yeah and it's an interesting one on regulation because the they want something that they can these regulating agencies want something that they can control or

i guess have transparency into so it almost do do you see them allowing this kind of and you know who knows where this regulation is gonna when and and how it's to come in but the the path forward is kind of we're seeing institutions deploy on these public chains um do you see them kind of filling out their own enterprise blockchains almost like they're they're like a secret side chain um or kind of how do you anticipate um onboarding into secret and and kind of fill out what that looks like yeah i i think

when we talk about interacting with any of these permissionless blockchains i always say permissionless versus permissioned instead of public first private because that gets real confusing especially the way that i talk about private blockchains so we're describing ethereum and secret are both permissionless chains anybody can interact with the contracts anybody can run a node etc but there's ways with secret network for example you could set up an environment on secret where you still need to be a known entity with a known address there's white listed addresses that are required to interact with a certain secret contract that's deployed on the network so let's say there's ten banks they each have an address each of these addresses is white listed to interact with this dark pool trading contract so when these banks each interact with that contract

they can't see what the other banks are all doing but they know because these are white listed addresses that these are trusted parties in the context of that application you can build and deploy an application like that on secret network you can have that level of control because there is some publicity at the address and at the contract level when you when you want it it's all programmable the idea is that it doesn't have to be all private or all public you have choices along the gray of the spectrum that actually makes these things usable because a bank will want to know that they're interacting with trusted parties but they won't want to reveal their activity they don't trust them you know to not front run them or take the other side of

their trade in a way that would be disadvantageous to them everybody has their trade secrets right in the real world on secret network you can maintain them but you can still know that you're interacting with trusted parties that said you could also deploy an application a smart contract on secret that didn't have a whitelisting capability that was open to all and then it's up to whoever's using that application if they enjoy that trust model right but the platform shouldn't make that distinction the platform should allow like secret network itself should allow you to deploy any type of programmably private application then it's up to the users and developers to figure out how to use that functionality to build things that can be used in the real world and that can be compliant and that can support trillions in liquidity that that's our

goal but it doesn't start from telling people explicitly at the beginning here's a bunch of stuff you can't do and with public by default blockchains actually right off the bat you eliminate probably 99 of use cases for web3 because they require all information to be public and that's i can't think of any real world application where we would accept that 100 of the data used in that application had to be public to all parties at all times it just couldn't exist right yeah the important info for certain things like you know in the example that we're using as far as front running goes it's you know it's it's almost it's there's pros and cons to it's having a fully open ledger for for all sorts of financial transactions

right there's less fraud but then as as we're explaining there's more just ways for parties to get in there and manipulate and kind of do what what they please based off the public nature so um you know in different industries like identity or in um you know in land titles real estate stuff but you know having an open ledger to see every single transaction that's verified on channel you can go on zillow right now and see all the all the sales of homes but to have that on blockchain would be pretty it would be pretty spectacular because you you have it as fully open and verifiable then of course but you go on but you go on zero but when you go on zillow and you see that price history that's awesome you can see the price history what you don't see is the social

security numbers of all of the buyers and sellers right and the point is that they're zillow as they used it to buy the house and they're banking out and all that yeah and where they used to live that's that's that's really the whole point and that's why i'm saying like transparency is hugely important and i started the conversation by saying we have to have it and it's one of the best things about web3 but if it comes at the cost of everything needing to be transparent that's the flaw of a public by default system can i go ahead go ahead i i was going to get into like one of these applications and driving a specific example sounds like decentralized identity but you know flush out that thought and then maybe we can unpack it a bit all right you want me to talk about decentralized

identity well if that is something because that's a rabbit hole that well yeah that's an application of blockchain that i think a lot of people have thought of and there hasn't been an implementation that's worked is secret the network to do that is it somewhere else you know just kind of what it's like it's absolutely secret i mean i think secrets the network to do everything but you're asking a very biased individual i think you know that so that's cool as long as i tell you that everything i say comes back to like really believing in this tech and like the fundamental thesis like we're passionate about what we think it's going to enable so the question to ask maybe is why haven't we seen a successful decentralized identity project on the blockchain

so what it comes down to for any successful application identity or not right there's two there's two main components one is product market fit right it needs to be right place right time right individuals uh and but then the rest just comes down to the the technology sort of matching up with the technological evolution of the space and what was what it was capable of there's applications on eth right now in 2021 that we're going to be completely impossible in 2017 but we all thought of it they were like i've when i was building in this space in 2017 i mean there was plenty of conversations about data marketplaces and like dexes beyond ether delta and all these things and only now with like the layer two solutions coming out and all of these bridges and some of

the zero knob there's a go even possible from a technical perspective so one answer to the question is just we didn't have the building blocks right secret wasn't on mainnet in 2017 so we didn't have these privacy capabilities there's obvious i shouldn't say obviously but there's a there is a very clear link between identity and privacy and identity is something that's inherent to you yourself and you want to reveal certain parts of your identity to some parties and not others you want to be able to prove something about your own existence but you want to prove only that piece of it like if i want to prove if you think about it like the way that identity should work on blockchain is if i've got covid right and i need or if

i don't have covid either way i want to prove it but at the same time i don't also want to tell you uh where i grew up uh my social security number like you need to know enough about me to make sure that i'm interacting with whatever you want me to do in the right way so a lot of these vaccine passports and things like that that were talked about people were like let's put them on the blockchain what a great solution that would be such a catastrophically awful solution the the only worst solution is probably what they ended up doing which was putting it all in centralized applications that were completely insecure which is also bad uh both of those are really bad but for the same reasons which is that their privacy and surveillance nightmares so i don't think that there's a there's been any

solutions to date for the reasons that we didn't have the privacy tech to support it i also don't think that people from the product market fit side of this i don't think people really needed or wanted to to use it in web3 there weren't things that were interesting enough to use for like years that you would care to like develop a robust identity solution beyond using an anonymous ether dress and like spinning up a new one there wasn't just that much adoption or attention as of 2021 uh there absolutely is and now we're realizing oh crap we're behind one of the examples that i would use is openc so openc i've known them since they started building openc and they were building when nobody cared

about nfts and when people did care for a little bit like with cryptokitties and stuff like building a secondary market for cryptokitties so niche and then a couple years during the crypto winter still building still nobody caring about nfts keeps building keeps building suddenly right as everybody cares about nfts there's been this platform there all along they were building like because they anticipated that need well into the future and suddenly when the nft tech and demand and product market fit could support it with the jpeg rush uh openc was there and that's how something can grow to doing like four billion in volume in a month and dominating like 95 percent of all secondary market sales for nfts so if now we realize that there's this huge need on identity which we do chances are there's a team that i don't

know that's been building into each space for years that's going to try to nail this and they're going to be right place right time just like those guys i would encourage them to look into how they could use secret for a part of that access control stuff uh which is going to be inherent to any privacy or any identity solution because we would love to integrate with that we don't need to be the whole solution you don't need to have identity only based on a single blockchain but for the part where you're going to need to protect identity and still have it be decentralized for the things that do require that element of access control and data privacy secrets should be absolutely that pillar and we'd love to be that pillar for any identity application for web3 and we would hope that any identity application

built in web 3 is cross chain not only eth native because then it unlocks access to every ecosystem and all of that liquidity and all of that creativity yeah yeah i just froze out there for a sec but um yeah on that on that note of integrations how do we how are we looking now with ethereum based privacy solutions so what is available now for our listeners who are looking for some privacy on chain you know just a quick rundown perhaps of some available solutions what they offer um you know and kind of how secret could integrate eventually with with some of

these or with the ethereum chain so first you know what's going on on chain right now for users to use um to enhance their own privacy sure i mean again like let's let there's transactional privacy and then there's programmable computational privacy right transactional privacy is usually what people are thinking of when they think of like privacy so there people are always thinking about mixers right like tornadoes something like that they just want to be able to like take their funds in take their phones out pay a little bit of gas and it's clean on the other side i like all of this is just i'm just describing it these are not applications that i actively use on ether i'm very much like focused within the secret ecosystem but i'm very i'm very

conscious of those kinds of solutions uh in the eat space then there's all the innovation that's happening in it at layer two like and all of these like layer two to lay what their one transfers and roll ups like there's ways to take things over to other layers to do trades on those layers come back to the settlement chain of ethereum there's those types of solutions as well which are more for scalability than for privacy but they certainly exist and are getting some attention um you know i i'm not sold on the product market fit of purely like transactional privacy solutions in the ethereum space and i actually think that you know a lot of them are going to attract the wrong kind of attention potentially um what i would love to see is privacy and solutions and heath that somehow work like they do on secret right like a

privacy solution that can protect against front running you you might be able to build that into your exchange right you have some sort of zero knowledge capabilities in a single exchange on ethereum that would have that functionality yeah have you heard of um eden it was yeah they launched as um something else and then they're now eden network and they are an med protector that is integrated with sushi swap so they have their own amm as as well and basically it's private amm trading on sushi swap through their through their integration yeah that's cool i see them that was archer archer was what it was they have archer swap yeah so basically swap integrated

archer swaps liquidity and so you can use archer swap now as sort of a private amm with basically no front running or mev yeah it's fascinating yeah it's bad it's fascinating how they've been able to like get that stuff together and market it i i still think like all these solutions were just in like nascent stages of understanding how they're gonna work one of the concerns that i have about building so there was actually a lot of conversation about like the phrase privacy is a feature not a product and i i think multi-coin wrote an entire blog post about this concept where i completely disagreed with the title but agreed of a lot of the context it was it was a very good blog post i just thought

the title was completely backwards so the issue that i have sometimes with a lot of this is like if you build your privacy solutions directly into a single application that's always going to have like siloed liquidity you need that specific product to be very successful and this same privacy mechanism might not generalize to other products that you're supposed to be composable with but if it only works for sushi and not uni for example right remains to be seen like the the if if privacy was really the sort of feature that you could add as a differentiator and build a moat around then in theory now now this would capture all of the liquidity in the eth ecosystem but realistically liquidity actually revolves around uh you know liquidity

liquidity begets liquidity and yield especially exactly so that that and then front running is kind of like a nice to have but on secret network like front-running resistance is something that every single application gets by default so rather than having applications in our ecosystem say ah we are the only front-running resistant exchange any exchange you build on secret any lending platform all of these d5 applications are already going to have front-running resistance by design because of the functionality of the protocol level but they're going to retain all of their composability all these applications on secret are still composable so that's that's what retains like decentralization on secret network that everybody's utilizing secret tokens the same way on secret network all these different amms are all going to be able to

interact with each other you can easily move tokens from pool to pool all these interactions are you know private privacy first and then they are front running resistant by design to me that's a more sustainable and a much more interesting and differentiated model than having a race where now it's like okay now every product on eat has integrated their own exclusive front-running solution and the trade-off is that it's more expensive and the trade-off is that it becomes a little bit more centralized and that's always the trade-off potentially yeah and less liquid as a result because like the liquidity is less transferable between pools or you constantly have to go on to layer two and off to achieve some of these solutions like putting the whole network private by default that that's the thesis that's always

been the differentiator if you make only a single application like that in your network i i don't think that that application is necessarily going to succeed but if you build one private application in a private universe you're you're going to have a very good chance of success because you're interacting with a bunch of applications that are equally private so you don't lose all those benefits of privacy every time you leave that application you keep it everywhere you go in the network so if everybody has that same ethos in the product to me that seems very sustainable now at the time that multi-coin wrote that blog post you know this didn't exist as an ecosystem so maybe it would have been right to say at the time yeah privacy will never be a differentiated feature but privacy by default can absolutely be a differentiated feature for a

blockchain and you can build an entirely amazing ecosystem probably on that differentiator alone from d5 to nfts and beyond we haven't even talked about how this touches nfts but it's it's such an amazing time to be experimenting with that design space because i think finally like we were saying there's interesting to do on every network so it's it's worth playing with new kinds of solutions that can't be built anywhere else right and we're seeing how go ahead andy we're seeing the the main use case on ethereum as you're saying just the transactional privacy it's basically like wild wild west avoiding regulations and using tornado cash to hide your funds basically is like the main use case on a theme

right now like that's it like we're in the wawa west some people might be doing things they're not supposed to be doing who knows what the what the sec is going to rule d5 so use tornado cache to you know do whatever you need to do to do what you need to do whereas yeah a fully private network i mean everything is just right as you're saying it's it's these these these applications i mean that application wouldn't even work on secret because well i mean wow you don't even need it same thing with kind of with the archer swap and eating concept because it's already integrated in built-in um so i think for full like as you're saying public by default chains some of those applications will work in in their specific niches but for the most part users that are really looking for that privacy will just simply go to

ones that are uh you know private and public by default kind of zk snarks esque so that's interesting mixers are dangerous texas are dangerous they they are they are definitely a target i think zk snarks might be that middleware between like a public and private which i'm almost hesitating to use probably versus private right and uh permission versus permission list so my question is how how composable do you see secret network with other evm chains um right all of the all the applications on secret network are aligned with private privacy in mind

but yeah you know the the on and off ramp there how open is that and uh yeah yeah that's that's a really good question because as we see a lot of activities currently happening on evm chains so uh but not all and i actually you know we've always taken a multi-chain view so we build bridges where we can't the reason we launched as a layer one chain in the cosmos tendermint universe is because of their focus on interoperability so for listeners who aren't as familiar with non-eth universes there's two main like interoperability focused non youth universes there's polka dot and there's cosmos tenderness chains polka dot has very much like a hub and spoke model where like polka dot is the hub and all of these para chains sort of

orbit around it cosmos has a much more sovereign model where every blockchain can sort of define its own identity so chains under this model include uh cosmos hub itself but also terra and secret of course and a cache um thor chain uses some of this as well they and they all are building with this idea of interoperability and they all share the same sort of fundamental structure so that when new modules are being designed for these chains we can all integrate them so one of these modules is ibc ibc is the big hype cosmos module that's being integrated uh sort of universally across their ecosystem right now the hub added it a bunch of the component cosmos chains have already added it some of the more

complex ones like terra and secret have been working for months to try to integrate it i think terra is happening this month our ibc integration is finally going on main net in october so that's a huge step towards interoperability with other tendermint chains initially but what that also means is that any of those cosmos hubs any of any of these different tenderness chains and hubs that connect to each other if there's one that is also connected back to ethereum we can all benefit from that ethereum bridge we already have a bridge that goes directly to ethereum so people can move assets back and forth but with the evolution of ibc the idea is that you're going to be able to do cross-chain contract calls so if you need to do some sort of like private game logic for example you can run the

private game logic on secret and be making those contract calls to secret from another chain and settle back to that chain and you trust secret because of the value that it's currently protecting and because of the size of its own ecosystem but the lines are going to start getting really blurred between all of these chains evm or otherwise we use smart contracts that are written in rust so the it's cosmosome based which is like the universal wasm standard across the cosmos ecosystem again cosmos uses it the enclaves and what that allows us to do is work very closely with these other teams to teach developers there's a lot of advantages to developing for you know

in cause and wasm versus evm chains but obviously evm dominates on the development side we don't want to see one ecosystem win or another ecosystem when we just want people to keep building really powerful technologies that are also secure we think most most of the cool security properties you gain via you know secrets model and webassembly and everything else like that makes it really advantageous to focus on that but we're not going to sit there and say we don't want to interact with evm chains because that would be stupid to throw away all that incredible developer adoption and user activity so we're focused on bridges to make sure we can access these universes but we we are very passionate about developing our own ecosystem because our own ecosystem isn't a silo our own ecosystem is always going to be

extremely interconnected with the rest of the tendermint universe and then any chain that integrates ibc beyond that which which any chain really can do it doesn't have to be um something like secret network to be able to interact with ibc chains so very excited to see this technology get more widely adopted across the entire web 3 ecosystem yeah that's that's awesome cross-chain contract calls are just ridiculous so i'm you're cooking cooking over there on cosmo we're cooking man we want we want to cook everybody wants to cook man i mean if never slows down either there's no substitute for the for the creativity and the originality of the eat ecosystem i'm so envious of everything that happens within the

ethereum universe and i try to be a part of it as much as i can because man like nfts like that's that's really cool it's becoming its own culture on uh on main dead and just ethan yeah and nfts are one thing you mentioned just all the different applications and once you don't have just like you said imagine what is unlocked uh in terms of nfts once you don't have them on public uh box yeah i mean so like your cam like your camera roll something i don't know well the thing about a non-fungible token is that there's always been a link between privacy and fungibility if an asset is private it can retain its fungibility

but as soon as you can identify it distinctly as soon as you can say this bitcoin has this provenance it's kind of not really fungible anymore you know exactly where it came from if you know that it came from silk road that's not a fun bitcoin anymore that's always the silk road bitcoin that was an issue with with yeah like blacklisting tokens and and would you want um which is still a potential issue right where china kicked out a bunch of miners and they were talking about chinese bitcoin like bitcoin coming from miners in china being just just flagged um so yeah uh that that leads to issues we think that so that certain privacy for nfts of non-functional tokens wouldn't that make

wouldn't that kind of defeat the purpose ah so that now you're asking a very interesting question no it would not because what the reason you want privacy for nfts is because you want the control to be in the hand of the users you don't want privacy in that it's private forever so you can never show it off or it's private forever so like you can't do anything with them the idea would be let me give you an example like if you wanted to use a privacy preserving nft and kind of have it as like a cookie for example but you don't want other people to know that you have it like somebody issues you a nft they send it to your address it'll it won't be visible on chain that you were sent this particular nft to this address and if it's a non-transferable nft as well

now it just sits in your address but if you ever need to prove that your address contains it you interact with another contract to prove you hold this token and now you basically got this private cookie access to whatever experience you want and you can interact directly with that token that you hold but you don't have to reveal to anybody else that you hold it whereas on each the whole point on each is that once you have an nft and a certain address you're completely doxxed if it's a rare nfc especially and people know that you like they can assign it back to a real world identity and they see that nft sitting in a wallet like eth doesn't work this way if i if i know you've got a underneath i know you're rich but i don't know why if you've got like the

specific board ape that i know belongs to jay-z or whomever and it's sitting in a public like address now we always know who that is and you're burned forever like you could never and you can't even get the nfts out what do you do you send them to a new address cool we know it was yours right there's no like mixer for nfts the whole point is that they're non-fungible so i actually believe the future of nfts their provenance is going to become even more important and you're going to want to issue them on private by default blockchains because on a private by default blockchain you can always choose to make them public you can always choose to say stick your hand up i've got this thing in my address let everybody know show it off like it's your rolex or your lamborghini or whatever else but if you don't want to

show it off if you want to quietly sweep every nft floor put in a private wallet and then eventually have a access controlled gallery where only certain people in the network are allowed to view it that's really cool doing this stuff on eve without you know re-centralizing everything in aws is practically impossible not not just expensive like actually impossible but on secret our aim is to make it even easier so as bullish as i am for privacy and defy privacy for nfts and what that means for culture and access i'm like i'm a hundred times more passionate about and i'm psyched for what we've got coming in q4 yeah there's potential there for uh metaverse museums

yes right like pride put like private art galleries you charge like a couple bucks to come and view the art yeah you can rent it and then you just regenerate a viewing key and you revoke access you know it's gonna be real interesting all that kind of that kind of programmability is what we're seeking to enable and in you're going to have to think of the world's hackiest solutions for like commit reveal strategies or whatever to try to get something like that done but in the in the secret metaverse i'm i'm actually like extremely excited the other idea that we have because we're talking about composability between chains we're thinking a lot about how to use ethernfts and link them to secret nfts like one-to-one so that if you prove that you've got an ethereum let's say

you acquire an ethereum based nft on openc and then there's some sort of bridging mechanism where you lock it on each so it unlocks a minted nft on secret network and so the really cool thing about nfts on secret network is that they can have private metadata the way that regular nfts will work it's all public metadata everybody can see everything about your punk everybody can see everything about your ape or whatever else but with secret you can have a bunch of public metadata saying here's the public stats then you've got private metadata things that are only viewable to you because you're the owner of the nft you've just unlocked all of this information about it you can also embed private metadata that isn't even viewable by the owner right so

to the punk owner themselves unless they do an unwrapped function and explicitly unwrap it otherwise you've got a punk with a secret attribute that you can get like you can sell it to somebody else and like maybe it's rare maybe it's not there's all these other like elements of gamification you can try and use so i should stop rambling about it because if you let me i'll take another hour but it's it's just uh i'm hyped for that design space because if you can link it back to eath back to solana any of these other universes where all this nft experimentation is going on then you know the sky's the limit yeah it's very exciting the nfc space is yeah it's going nuts right now it's longer it's been fun to watch man it's been fun but uh yeah so we appreciate you coming on man we're

about running low on time but you know we just have one quick question for you that we ask everybody at the end which is uh if you had to pitch the secret network in an elevator uh who would you pitch it to and why oh cool question yeah it's a lot easier if you're pitching a single application i imagine because you know it like i honestly god who would i pitch it to the entire blockchain network i i would probably used to say somebody in finance but now i gotta pick somebody in culture right somebody that i know would get this somebody who understands the idea of secrecy the importance of privacy like somebody who's got their own secrets uh at one point in my more foolish years i might have said john mcafee

because i know he'd get it right away and that would just be a fun conversation but probably a terrible idea um i don't i don't know i don't think edward snowden snowden would also be an amazing choice i actually i i tried to uh reach out to him a couple of times because he did some nft work on on ethereum i'd love to see him do some nfts on secret embed some of his own work within a secret nft as private metadata you know i think that would be cool he'd probably appreciate that have you been um yeah uh yeah he's going through i've met him a number of times yeah for sure yeah we have a bridge to monero uh so that that went live on mainnet last month so we're getting more

integrated with some of these privacy by default transactional privacy ecosystems he'd be an interesting person uh to continue to have conversations with but i think if i had to pick the one person in an elevator i think actually you came up with it for me i think snowden's perfect i really think that would be that would be a really interesting opportunity because he's he's seen it all and uh i'm i'm fascinated by somebody with that level of courage yeah he would get it you know i think he'd get it right away i don't i and the best part is there's no expectation he's going to jump and now show it to 100 000 followers or whatever else like i just want to talk to him about it like i like talking to people who i don't think they're going to have a vested interest to be a shill but they

actually think i could use this for my own work i could use this for my own purposes i think my other answer would be banksy i'd like to pitch secret network to banksy that would be a lot of fun but i don't think any maybe i already have and i just don't know it right exactly banksy if you're listening to this coming on you hit me up guys well thank you guys for having me on it was a blast of a conversation you you guys seem pretty passionate about this stuff so i'm excited to see what you guys cook up next to thanks for coming on mate it's been a pleasure