DEXs: Minimizing MEV, Fee Market Developments, and Superior DEX Designs | Season 6 Episode 8

Transcript

so to me having a really good unisoft cross chain experience is I think like maybe the most important unluck un luckily I think unisoft X cross chain is is a fantastic design is going to really unlock a lot in terms of just in general interoperability and movie assets between chains you could imagine having the main unisoft chain not being on on aum1 that requires again that people still be able to use it as if it is all right everyone we will be back to the program in just a moment but before we do I want to share something that block Ro has been cooking up for these last couple of months March of this coming year in London blockworks is hosting D London the largest institutionally focused conference in all of crypto Goldman JP Morgan 72 all in one room so you can know what the big money is doing

so click the link at the bottom of this episode it'll take you right over to the homepage and use Bell 20 for 20% off I will see you in Sunny London Town in March hey everyone this episode is brought to you by Maverick protocol a suite of liquidity tools built around an Innovative amm Maverick helps token projects St treasuries LPS or basically anyone in defi shape their liquidity with efficiency and flexibility how you might ask stick around and you're going to be hearing about them more later now on with the [Music] show all right everyone welcome back to another Bittersweet episode of bell curve because uh I'm joined by my my co-host of this season Dan Robinson and this is this is the final one this is

the wrapup so um it's sweet because it was a great season but it's bitter because yeah this is uh this is unfortunately the end but I'm been a hell of a ride hopefully in a future season you can bring me back as a guest to talk something other than daxes and MAV absolutely uh we can do a whole Dutch auction episode just special for you um I'm sure that that'll that'll feature in somewhere um but guys yeah this has been a really fun season with Dan if you if you're just tuning in for the first one i' highly recommend you go back and listen to the interview episodes of this season Dan and I dove really deep on a whole bunch of different uh topics related to dexus and this is going to be kind of the wrap-up where we sort of do a tldr and dive a

little bit deeper into some of the the highlights of the season and you know D it so sort of feels appropriate to start off with the first topic that we spent the first couple episodes were dedicated to this but it kept cropping up um in in subsequent episodes which is this idea of minimizing me leakage uh specifically with a focus on uh mitigating lever which is the sort of loss that LPS take by not having um constant access to to sort of pricing data so you know when you look out into the future um and you look at sort of promising solutions to lever or recap of value at the application layer around Dex is you know what were either some of your takeaways for the season or like things that

you're really kind of excited about promising areas of research projects Etc yeah so first I think you know we we kicked off this is by talking a lot about this but and think about why are we so focused on Mev when we talk about dex's I think part of the reason is that if if you come to dexes entirely as a as like a market design problem and you and you treat it as uh using the same same tools um and Concepts that people use in traditional finance and you see it as largely a zero sum game between Market sophisticated market makers and and Traders um I think there are very important insights to be taken from that but it's worth thinking about that in traditional Finance the spreads we're talking about um are so much smaller and

so much more efficient the experience is so much better than it is in dexes that actually they're running up against these theoretical limits um that we're not even close to and so I think it's important to think about when we're talking about Dex research where is this value leaking out uh one of the improvements that could actually make it better for all the real participants in the system before we start to actually hit these hit these theoretical limits and have to and have to think about the same kind of problems that traditional um uh Finance systems do in the in at least the ways that they think about them and I think Mev is one of the biggest where if value is going functionally to the propos to the block proposer rather than to to any traders to anyone who who doing any trading participating in the system that's just

generally is going to be a net negative for all for liquidity for um Trader experience for everyone in the system and I think that's that's why we see that as the biggest pot of value to take from before we have to worry about how we split it um uh all between between participants within the system and so I think that that framing of of uh they being this incred incredible you know um pot of value to be reclaimed by Dex before we even have to hit some of the harder trade-offs uh with that being Mev I think is why so many Dex researchers are Mev researchers and why particularly loss R rebalancing which is one of the most tangible forms of that um uh is is I think a big topic right now yeah I tend to agree you know one one question that I had for you and it's it's funny

we did this it was the second episode of the Season we did it with Eugene and and Doug and we talked about amm versus Central limit order books and when we did the episode this was sort of pre this uh Renaissance this mini Renaissance that salana is H is having right now and I think that the two interesting actually there are sort of three uh interesting aspects when you look at that which is one the central limit or order book design which doesn't really make sense on ethereum does make sense on either your own specific appap chain maybe in Cosmos or on salana uh you know to I think there was a very interesting discussion we could have even dived a little bit deeper about the importance of block times especially on something like lever uh Mev and general I feel like that's sort of um rearing

its head back again but you know I would love to um I'd be curious if you're looking on some of the deck designs that are happening over in salana and maybe if we could sort of rediscussed and the importance that it has on Mev and lever because I actually saw Stefan you know a flash ex flash Bots Fame you know he posted one of his predictions for the new year was actually doubling or tripling the ethereum block size and I've seen a lot of you know very different takes on yeah yeah block time yeah and uh I've seen a lot of very different takes on very different takes on that's bad for meev it's good for meev can you just sort of revisit this idea of the the impact that um lock times have yeah so I think think I think two different

discussions get a bit bundled together here um in a way that that can lead to some confusion and even I think has confus me in the past and one is I think the there's this real um uh line of research in you know in Tradition Finance we talked a lot of this uh season about the Eric British paper on uh frequent batch auctions as a solution um as a market design and I think um that's one way say when you get to these very fast uh incredibly fast blocks um uh and these latency games you often can have a lot of of waste a lot of unfairness a lot of potential uh centralization um in your in your in your Market structure as a result of those games happening um and I think

once you get down to these fundamental latency limits you know once you're below um I don't I don't want to name like a particular maybe maybe like half a second maybe maybe um one second or maybe less um then definitely I think you you start to see uh real trade off when you're already hitting that I do think when we're talking about like 12 second versus 24 second block time uh block times um I think these other these other factors start to dominate um and I think you uh yes I think when that's it's a worry that I have is that um uh these lessons that are that I think are correct about uh it's not always good to do first come first Serv and that things break down at a certain level with first Cur first served um if you do it uh at

two at two low latencies doesn't necessarily mean that like really long block times is necessarily the solution um or that it makes it any better um and yeah I think I think there's you know there's a school of thought and mostly it's not coming from Dex designers mostly this is coming from um people who are concerned and I think often rightly about the centralization of the of the Bas layer um and about the ethereum consensus um in particular that are that are pushing for okay we may need that we may want longer um block times but I think it does come with a real trade-off for uh for dexas that are trying to be built natively on top of that and you know I think it will leave ultimately to um uh people not relying on the um on blocks for uh on block producers for uh

uh for ordering of transactions indexes which I think might be okay I think that that probably is where we're going is that just and I think it might be healthier for everyone just a one funny irony that I've noticed recently is I think the biggest problem facing um app developers and lerry developers right now is that a lot of their Mev is leaking to the Bas layer um and the biggest problem facing the Bas layer right now is that a lot of application Mev is leaking to the Bas layer and it's destabilizing their consensus um like you see these things with timing games for example this is all a consequence of there being too many like dexes too many uh uh applications that are relying on the Bas layer for these things that produce a lot of Mev and that that caused these timing games that could

destabilize just the stability of the consensus and so there's actually an alignment here a really nice alignment where L2 developers like it's a shame that that we're giving up so much Mev to the L1 um and the L1 developers like don't want the Mev we actually want you to keep the Mev because it's actually hurting us to be giving us to our proposes it's making our our blockchain less stable and so I think in the future we're just going to see more of that me be captured at at higher layers and we talked to um to lwig about um about some of the solutions for this um but I think I think l2s are another um another of course just more General solution um and I think these kind of these Solutions where we just say all right let's just not put meev on the on the L1 means that

we might be able to have long block times on the L1 I think that's I think that might be fine if again you've got transactions being sequenced in some way by by other parties yeah that is a really neat alignment and for for folks who are maybe less familiar can you just sort of underline what what what are timing games when we talk about yeah this is a phenomenon we've started to see in practice um more recently and so this is in ethereum I mean I I'm not an expert at this at this layer so I may maybe this is simplii theor version of it um you're you have uh you're supposed to send your block um uh basically at the beginning of at the beginning of this 4 second period you this like 4C period to send your block and what people have realizes you know I

can actually uh propose this if I'm a block proposer I can get a few extra seconds of Mev maybe almost like four seconds extra of Mev from this block by sending my block a little later because a testers people who are going to sign off on this block um are you know are still going to sign it if they receive it at the end of this period and that's that period is basically meant to support regular um latency um but I can you know I can I can make a 16c block rather than a 12C block if I'm able to wait almost to the end of this period but then of course if the person before you um uh is also doing this they've actually taken four seconds off the beginning so you end up with 12 seconds of me anyway you just shifted it

a lot later and put the network in a much less stable position um and this is because for the proposer what you want is to have as much me as possible in your block and not and not leave any of it for the next block so you're going to push that that uh time to the Limit um and I think this you know this runs the risk of destabilizing ethereum's consensus because it just means you're relying more on this uh on like this this very tight uh latency bound basically that that proposers are calculating for when they send their block um Without Really necessarily like improving anything in terms of user latency or just sort of Shifting everything by four seconds um and this is because it's just so valuable to have a few seconds of block time when there's this big um latency AR available in the

block yeah it also does open up a potential Vector of centralization I'd say maybe in within something like staking pools like Lio sort of or P2P I guess whichever entity ultimately like they you kind of saw a bunch of their validators like shift um basically further in time exactly this so I think I think there are implications that and is that related Dan I'm um also not super familiar with this but there was a problem I don't know a couple months back I can't really remember where ethereum was having trouble finalizing blocks for a little bit and that has sort of led to this proposal to uh increase the max limit for the amount of steak just because there are so many different uh nodes out there that need to you know provide attestations just you know some sort of physical limit

right for how many how much you how far you can send information around the world to however many different validators so that is interesting like that I don't know if those things are related but I see the argument for destabilization there there are a lot of reasons why I think and ethereum consensus researchers would be the first to tell you this why a lot of the things in it are not are not optimal right now um I think yeah think what one of the things is you you have you have this maximum staking amount um 32 weeks so like every if you want to run a validator with more than 32 we you have to just run a bunch of different validators but that's kind of just it's just forcing you to basically civil attack the system you know it's it's not really a civil attack because they know

that people will do this and that's part of the system but it means it's kind of pointless that they do that they that they do it this way and it's it's not it's not really done for like you know it's not supposed to be actually more they don't think it's causing more decentralization it's more just like sort of a simpler algorithm in some senses if you if you have that but yeah causes all these issues um uh because you have to just have communication potentially between like you know hundreds of thousands of different like public keys if not individual validators um uh in order to do this so yeah I think that's I think there's Improvement to because this protocol that could possibly help with that but I do think the the more controversial change might be to raise that to raise that minimum um and to say like you can't you need

more than 32 weeks to State because ultimately that imposes some limits as well and I think that's controversial because you know a lot of people um want there want to maintain the possibility of solo staking of somebody being able to stake on on ethereum and I don't know if you've done a uh season on um ethereum consensus or on or consensus or the base layer um uh by state like that would be I think that would be a great thing to dive in and I'm I'm not the person to really the expert to talk about this but I think you're starting to see a lot of really interesting things happen around that I I'll tell you this one thing that I've been thinking a lot more about because there's just not an enormous amount of info about it is fee markets there's a really interesting history of uh fee

markets actually going from Bitcoin to I was a huge inerd over Thanksgiving I've talked about this but I went back and listened to to a bunch of old epicenter podcasts that were happening during the Block siiz Wars now that's not necessarily just the fee Market of Bitcoin but it was but it was brought up quite a bit um and and if you go back and actually listen to some of the old like Tim Ruff Garden episodes during EIP one t Tim is like in my opinion the way he describes fees and his level of knowledge is like probably deeper than anyone else that I've come into contact with but you know there's surprisingly little out there on fee markets for such a critical part of how all of these different uh l1s especially work and it's actually something that feels very relevant like we hosted a a salon of

research hang out this week in our office and the only thing anyone wanted to talk about was fee markets because it's kind of broken as it exists on salana today but there's the ability to do something like multi-dimensional fee markets where you're pricing out different resources in a more granular way and there could be uh there's an opportunity for a step function Improvement uh as well so yeah really I think I think maybe underappreciated part of it I tend to be a big IP comp 59 fan and that's part because I was I was like in the Unis Discord a lot in in 2020 when I didn't have any else to do and um back then it was it was just really common for transactions like the most common support question would be um people have uh uh transactions that have

been in the men pool for like 10 minutes and they want I need to figure out how to um up their fee manually um and people do then just just completely changed that whole that whole dynamic it may it may have changed by ultimately I think ining average fees that people were paying um so not it's not necessarily entirely good but I think just from a user experience perspective I think it was fantastic and then I think of course you know the um more value at the time certainly more value going to ethereum rather than going to uh to miners was I think considered positive although again that changes a bit in Pro of stake where all that value sort of functionally is going to anyway but ap5 59 is getting a lot more controversial recently like people some people have been talk about we actually

roll it back yeah you talk to talked to Max Resnick about I don't know if I'm not going to put those words as about that we should roll back necessarily but what's the uh what's the reason for that just out of curiosity well one of the reasons some of the reasons I think um maybe press which just talked about this as well is it it may not be actually inad of compatible um like it could be could be uh if proposers were to um certainly if they were to collude to basically push down the the base fee um it's possible to like actually have proposers capture more value um and so you know that's not necessarily daming in itself uh but there are maybe alternative mechanisms that would be more resistance to that maybe not and I'm I I think I'm not I haven't come to

a conclusion on it yet but I've been surprised to see more people being like Oh I don't know maybe we need a different Fe Market entirely on um on L1 and then on L2 I think a lot of um applications have adopt a lot of l2s have adopted 1559 and I think it mostly it mostly actually seems to work fairly well but it may you may want to change that given l2s that work very differently so there may be ways to for example you could have you know some um you know you could when you when you have PBS PBS versus PGA as one as one Spectrum right and most uh uh LT using PTA right now and um uh you know 1559 versus other Fe mechanisms another as another metric I think there's a lot of different combinations people could think about and they might be different

on L ones yeah you know I'm gonna link this actually in the James is it first of all he has one of the best I think most underappreciated blogs in crypto but he he wrote a you're you're reminding me of this uh that the title of the blog post is has anyone checked in on 1559 recently and keep in mind when 1559 was describ or was designed you know it there this was before anything like proposer Builder separation and separating the role of what has historically been the minor and is now the validator but is now really the validator and the and Builders um it changes the incentives and there actually is there was sort of a baked in incentive at one point for the ultimate Builders of the block to not push the the Target down there's a there's a Target and a limit uh in 1559 but now

that incentive is basically gone because because you you know you've cleaved these two rolls in two so it's it's is very interesting very nerdy cool stuff the the other thing I'll say about 1559 and we want to talk about dexas so we make this be the last out but it is relevant to dexas as well we touched about it on it this season but the other thing that's interesting about it is you know the reason for the burn originally was to make it incentive compatible with miners right you didn't want the reason you burn the base fee is so that there can't be some offchain sort of solution in between Miners and whoever's paying the fee like hey all right it's $90 worth of gas but want to pay $90 like I'll pay 60 and then you just rebate me 30 offchain if you burn the fee then you

eliminate that possibility but that kind of morphed over time into you know ethereum tokenomics and buyback and the The Narrative of it has changed over time and if you go back to the early days of the discussion it was very much so about this ux Improvement that you were just alluding to there Dan like it's much better user experience but it's kind of changed over time into this uh you know celebrating the burm and ultrasound money and all that stuff and not to say that any of that's wrong but it it's a little bit of a rewrite um so one thing I'd love to get your get your take on just before we move into recapturing I I want to talk about actually specifically about FB and the episode that we did with uh lwig and Anna but the the last thing about

salonas one thing I've I've noticed um is kind of this narrative is so first of all salana dexes are creeping up to uh eth Dex fees recently um a yeah yeah um here I'll find I'll find the actual statistics for you but if you look at tvl it's like much much lower and so there's this kind of idea of capital efficiency um you know that obviously Central limit order books are you know different from amm but I'd be curious from your perspective as you know a DEX designer who spent a lot of time thinking about this like is tvl an overly simplistic sort of metric for instance is it better on univ V2 to have more it'll shell more tvl but on V3 if people have the flexibility to kind of provide liquidity at different ticks Etc like how do you think about this kind of

emerging you know sort of additional maybe Nuance of capital efficiency in the world of dex's yeah so when you said salana fees are higher than um or uh it was volumes it was volume salana Dex volumes yeah yeah yeah got it no had yeah um well certainly right I I think Capital efficiency you know obviously with move from V2 to V3 was almost entirely driven by um feeling like actually tvl is the wrong metric trying to get as much uh unth capital is is the wrong metric and in fact that that you know liquidity at the margin is a much more important important metric and in general and that and that volume as well I think is um ultimately more of a more of an important goal to search for us to optimize for so yeah so I I think it's great that um we're finding

new ways to provide liquidity with lower tbll um and I think you know if you look at the move Al also like unisoft X potentially like you know you're as a system does no TBL um but if it's if it it provides better execution for users then that's a really that's a really important um uh thing to have I think yeah so I I think tvl as a as a metric it matters when you're comparing light to light things um but I think comparing certainly some people try to compare like lending protocols to to dex's to uh right whatever it's like it's all extremely apples to oranges when talking about this um I think volume is not necessarily the right metric though as well um like I think volume obviously can be gamed but even when it's when it's not being GED it isn't necessarily

telling you the the thing you want I think um yeah for for different things you might want different metrics but I've started to to try to think about things more in terms of um uh of order quality and Order execution um and price Improvement as maybe the as maybe the thing like if you want to just hyper optimize one thing um then just giving best execution to you know better prices to users is really actually the thing you want not necessarily getting as much volume as possible okay I think that's good you know that actually Segways really nicely into frequent batch auction so you know I'd be curious this this actually ended up coming up as well in with in our interview with Antonio where he discussed implementing an FBA within dydx that's their s part of their new upgrade but you know we talked a

little bit about um you know from the perspective of the the lp right why lever is so important because ultimately these LPS need to be profitable um but on the other hand there is the question of best execution and how do you define best execution and if so what's the correct uh construction for an exchange to give users best execution so yeah I guess just to you I know you have a relatively straightforward definition of what best execution is if you could Define best execution and um you know maybe touch on how like an FB like how suited is an FBA to doing that or alternative designs that you're sort of interested in yeah well right so maybe I shouldn't have said best execution because I think that's a term term of that can often be talking about if you've got you know the best possible

execution available in the in the world which is what stuff like you know regs nms is trying to um uh enforce right so I'm talking here about like about right price Improvement um I think ultimately you know if you have with that is the end user for a DEX I think that we're trying to optimize for is is swappers is somebody showing up and wants to get from one asset into to another um and you know we want is in the long term an equilibrium for them to be able to to trade at at the best possible price um and I think that requires in the moment possibly giving them the best execution available anywhere um but it also requires which be so just like you'll you'll get a better price trading on this system than you will trading anywhere else um like that's that might

be part of it or at least you know that we try to optimize for that price but the other thing in requires is that all these other participants you know actually engage in the system liquidity providers provide liquidity to the system you know there's you actually want any there would be a stable equilibrium where where softwares get this so I think you know and this is something that a lot of people have pointed out um uh including as a critique of some of my ideas which I think are you know I think they they have a point which is you want you want to make sure that the whole that every all parties in the system are actually um incentivized and are and are uh uh get some some the proper uh instead of to participate which might mean in in an individual moment somebody

you a swapper might be like just they might have to trust to this system and it's possible the system gives them a worse price than they would get somewhere else but in general like they know that on average they will get a better price from this from this system and that can happen when you when you uh you know want to go trade on a batch auction um is sometime sometimes you know you're you're taking the risk that maybe you will get a worse price and you might be able to get if you were trading somewhere else but ultimately on average because you know that's that's what's going to get all the participants to participate in this system and create uh deeper liquidity so you know I I'd like to return a little bit to that and go a little bit more in depth with that

interview that we did with lwig and and Anna and maybe transition this a little bit to how some of that uh how more mechanically some of the the mevis recaptured at the application layer we we didn't go quite as deep into the construction of something like angstrom as would have been been fun I think on on that episode and uh yeah I'd be curious actually if you could just maybe uh first of all you maybe just remind listeners like what is the uh what is the basic construction of of angstrom and sort of the um all all the different actors in in uh Ludwig's design and then maybe we can get into the weeds of like what are some of the different flavors uh especially on on hooks or other dexes or whatever of recapturing that that me at the application layer so the the

general category of amrom solution is what I call an expost auction uh Mev auction um for LPS and what that means is that after volatility is realize so in during the process of that a block is being constructed um an ethereum block is being built uh during that process at some point as ideally as late as possible there is an auction held where somebody bids and um and pays uh to be to be able to be the first Trader in in the block um and the right the right to to trade against liquidity providers passive liquidity providers um on that pool on a particular uh uh Dex pool and with um uh angstrom they're building it as a as a hook on unisoft before um and

so it's it's a before pool where there's a hook that just enforces that only the winner of this auction um can uh can trade on this pool initially so that's that's at least one part and that's the part we talked most part there there's also a batch auction component to it but maybe just talking first about the lever recapture component top of block auction so the the obvious question there is who is holding this auction so the auction happens during this block so we we know it can't be done entirely on chain because the proposer for that block controls whatever goes on chain and so in that case that in equ they'll just censor every everyone else's bit so they would end up waiting this auction so we're back to where we started with the proposer captures all the lever and that ends up being met so it has to be held

in in somewhere else other than just like through our uh bids on chain um and the uh their solution is to effectively have a separate consensus process among among validators uh among a separate a different set of validators who are who are holding this auction and they do it in a way that is more that is more censorship resistant um and I think there the details of that auction aren't aren't relas as much but one one that is is the one we talked about with DDX um thex put out a post about about how to do this in the context of their batch auctions and that's one where you you uh have a consensus process that doesn't just have a monopolistic proposer where the proposer is the only determinant of what goes in the block you also have in general like a process uh for something

like tendermint um BF consensus you have a lot of other validators who are uh in normal tender are just voting on the Block they're just saying here's What's um uh I say yes yes or no to what the proposer uh proposed um but with what dydx has uh designed um in addition to uh voting and saying yes they can also contribute additional information they can add um transactions and generally DDX like it's included in the next block rather than in the current block but it's the same basic principle where you have this collaborative process where you need you know more than a third of um or yeah you you end up getting input basically from two-thirds of uh validators into every block and that makes the individ this individual

consens of process uh more sensorship resistent so to to sum sum that up there's a separate consensus process than ethereum but in order to avoid this problem we have in in ethereum where the block opposer basically can just censor all other things you can run an option just on chain there you have a consensus process that works a little differently where you have input from other validators and there's an assumption that at least you know that's that some percentage of those uh validator are honest and non-sensory let me ask you this just at a high level I mean this actually sounds a little bit like it's almost sounds like similar to the discussion on rollups where okay we've got one centralized sequencer But ultimately we're going to have to we'll have decentralized sequencers or shared sequencers but then we have to do some

form of like Cil resistance and leader rotation and then oh we're kind of running like a separate set of consensus on top of our ethereum consensus does that feel just as a mechanism designer does that feel inefficient to you is there a reason why you know what I mean is is it inefficient or is it not and I'm just for whatever reason that actually makes a ton amount of a ton of sense but you know what I mean I think I think there's a there is an efficiency to it um and it's what what what comes from modularity um and I think there's you know it's it's a big meme um recently but I think there there really is a lot of Advantage saying we're going to have one layer of consensus that just does it does one thing it just you know um uh reaches like some extremely final

relatively so slow consensus for example and very like just everyone in the world actually agrees on this you think of that that's maybe like ethereum L1 consensus um and then at at higher layers we could say all right we're GNA have some consensus that maybe maybe it is trusted for Less maybe we're actually not as worried about um reverts on it because we're not gonna you know if you're able to to violate the assumptions you're not able to like steal everybody's money but you are able to um to extract like a little value so we could have different security assumptions about it maybe it's just like it could be detected if you if you misbehave and then we'll just move to something else right it's not as All or Nothing um security and so then we can actually get better Better Properties out of it and different different

systems might use different um uh you know l2s different different sequen or Solutions um and I think I think there's a lot of there's a lot of efficiency gains there potentially there's also gains just in terms of what kind of innovation you can have the pace at which things can can be discovered and can change and I think it's with ethereum L1 consensus they rightly are just very careful about making any changes but trying to push anything to aggressive because if you break something you break it for everybody is broken um whereas I think with with l2s you can be a lot more aggressive especially if again you're you're enforcing these security properties so that you can't you know like being too aggressive doesn't mean that people everybody loses their money it just means maybe your application um doesn't work for what you designed it for and I

think we can have you know it's nice to be able to have a lot more Innovation at that layer and I think the the key thing here is you know this has always been part of the ethereum PES is that you have you know ethereum as layer one and then you get to have a lot more experimentation on the L2 on sorry on the application people have always that that's why ethereum when every got us all excited about ethereum in the first place is instead of if you had a cool idea for an application you go to build your own blockchain and do all that stuff you could just build it as a application on theum that's much simpler and I think what what we realized is you also may need to interpose a layer in between um you may need to have like a separate

consensus layer or sequencer layer and that could be an L2 it could be an application specific sequencer like um like angstrom uh has designed um it could be you know could could be something something else but really it's all right this consensus that we're getting at the at the L1 layer may not be um enough so we need to add another interesting all right everyone we will be back to the program in just a moment but before we do I want to share something that blockworks has been cooking up for these last couple of months March of this coming year in London blockworks is hosting D London the largest institutionally focused conference in all of crypto we are gathering 12200 of the world's largest asset managers so thank trafi macro funds Crypt native funds big allocators and financial institutions so Banks payment processors Etc all in one spot

it's very rare to get the likes of Goldman JP Morgan 72 whatever all in one room so you can know what the big money is doing we're diving into the themes that they care about so we're talking about the intersection of macro and crypto where we are in the cycle real world assets so everything from stable coins to onchain treasuries to tokenize assets it's going to be a blast but the other reason you really want to go it's London baby center of the world at one point you got Pub culture you got fish and chips great beer it's going to be a blast so because you're such great listeners to bell curve there's a code Bell 20 that's going to get you 20% off so click the link at the bottom of this episode it'll take you right over to the homepage you'll see all of our speakers

and use Bell 20 for 20% off ticket prices are going up soon make sure you go use that code I will see you in Sunny London Town in March one of the other questions that I had for you around um you know speaking of Antonio um was you know it's very interesting we got through this entire season basically approaching things from the perspective of there being a a general sort of L1 uh that produces generalized block space like ethereum and then we're building apps and then there's some sort of either competition or effort to redistribute value away from L1 proposers back to apps and various different designs uh for what the best way to do that is and then we we kind of ended on Antonio being this a very different sort of Paradigm where actually this is the cosmos uh

especially full stack app chain thesis where you know your validators run both application and consensus layer um uh you know code and it's it's very very much one and the same and uh you know he he had a very different kind of perspective on Meb because it it's sort of a a merge set of stakeholders so to speak um although he did include dydx the protocol as an additional stakeholder so we still ended up with basically the same amount but you know I'd be curious any any takeaways that you had from the Antonio episode or just for for listeners who are trying to maybe merge this concept of preventing meev leakage that we've been talking about again this entire season within the context of something like an app chain I mean how should people be

thinking about that differently within the construct of nap chain yeah I think that's a great point and um one thing that dydx got and we we touching it a little but maybe should have emphasized more is that just by moving to their own nap chain um where dydx uh uh tokens need to be stick with validators in order to um uh for for those validators to have this power to extract map just by doing that do align the whole system somewhat more um in that you'd expect an equilibrium basically the me from that can be extracted if it is extracted is going to go to actually to just idx sters it's not going to go to um to those individual validators because they'll be competing you know validators will be competing in whichever one you'd

expect you know uh is able to if you're able to extract more Mev you'll be um from blocks you'll be bidding you'll have to end up kicking back more and maybe potentially paying people to delegate to you right so you could end up in an equilibrium where maximum meev is extracted But ultimately that all goes to BX um holders and you know that that's analogous to situation we have where um arbitrageur you know are very competitive they're not actually capturing the profits from on ethereum that's generally going to proposers and the proposers in general um aren't able it's not like running really a really good proposer means you get to get a lot more uh uh profit because ultimately you're competing to get State delegated to you in order to be able to validate more so ultimately that you know tends to go toward ethereum holders and so

with dyx it's going to dyx token holders rather than to some other platform so in some sense leakage is is reduced so I think I that as a as a first order effect is significant I think we don't want to Discount that that said there these second order effects which include the experience for uh users as a first order as second order here experience of users is degraded um right so swapper now has to think about okay you know my my trade might get maximally value extracted and it's it's not great consolation for them it's like but it is going to it is going to dydx um stakers right it's going to right um that's that's not necessarily a great consolation for them and I think uh there's also you know like third order effects here where like okay that means

like they have to think about what kind of you know that might uh discourage them from placing um uh retail swappers from stopping on it and so then like now like anyone who providing liquidity on the on the system has to think about this and you basically end up with just a collapse of this of this whole thing and everybody is worse off and there's less fees going to anybody um and I think this is the same kind of thing we worry about with Mev it's not with Mev the worry for ethereum really is not um that uh that oh like ethereum you know e holders will get too RIS and like too much of the money is going to come to them it's that actually if you have a system where e holders are extracting maximum value that ultimately that's going to kill the Golden Goose that is

providing all this value and this is this is the even bigger non-zero sum game that we also kicked off the season talking about is ultimately like it's possible that ethereum holders by extracting less value could actually end up making more more value because as you you decrease these this dead weight loss this this these costs to to swapping um and so as a result like you get just like you know 100 times more volume or something and and as a result people um a lot more volume happens and you make more money and I think that's the that's what we're really ultimately ultimately hoping for and that's what I think dydx is really focused on this they they actually despite the fact that DX toen holders you know you'd expect to be the beneficiary of this it's still very important for them to do this so that

they don't degrade user experience so they don't end up collapsing the whole system um and I think maximum value extraction can be can be shortterm make a lot of sense and in you know in these kind of in this game theory it's possible that it just only makes sense to to or you you are forced to maximally extract value but I think everybody knows that potentially you end up with a tragedy of the commons there where long term um the the system just doesn't work for anybody yeah I so so so much to unpack there but you know one of the reasons my my the interview that we did with Antonio is one of my favorite of the season is he's not afraid to just say his say his opinions um like he he comes out and he was like hey we should be prioritizing swappers over everyone

which I like probably is the right move you know you can't just ignore everyone else but like that's probably the right thing to do the the other thing just um you know it sounds very good from a narrative standpoint oh you know your stakers are you know part of the ecosystem y y but I think when you really examine that it kind of breaks down a little bit it's like well who are your stakers you know usually in in Cosmos it's like the same set of professional operators that are doing most of the validation and actually with dydx specifically they have a really interesting validator set where there's a lot of like um it's actually very atypical of some of the other Cosmos chains um there are some it's kind of an interesting makeup uh and then the other thing is like we did a season it was the

second season we did the show on governance but this kind of meme of token holders and uh users being the same thing is really a meme it's not the same it's like you have a separate set of investors and then you've got users of the product and you probably have to prioritize the users of the product um but but some of the stuff that I think Antonio is doing with taking advantage of ABCI Plus+ mode extensions although there's still a lot of wood to chop there I don't want to you know there's a lot of work that's left to do and we're not sure how performant you can be um I think it's extremely interesting very holistic approach to to Mev um and I know you involved in the design of that as well so pretty cool stuff um all right last uh last question that I had

for you on that was just perss like we talked a little bit with Antonio about perss and frankly we could have gone down the rabbit hole of doing like uh options and different sort of construction like there's some very interesting like solid Le Forks up on uh up on optimism right now and we could have gone out a little bit further into the risk spectrum of new dexes but um I'm glad we talked just a little bit on on perss as well I mean what are your thoughts there relative market share kind of moving out from from here relative to spot yeah I'm you know I'm not sure certainly in the short term I think in the long term you know my my goal for my personal goal um with respect to Dex volumes is to get Dex is to basically replace the centralized exchange ecosystem with a

decentralized exchange ecosystem and have um the vast any any volume that currently is happening in centralized exchange crypto should in my view should be happening in decentralized crypto there's de centralized exchanges there's no reason it shouldn't be and so in some sense um I guess what you'd expect would be maybe then we'll replic we'll end up with a somewhat similar Market structure in decentralized exchanges and there in centralized exchange crypto per volume uh far exceeds spot Vol spot trading volume and so possibly um you'll end up actually with with uh sort of something similar where eventually Prep Prep Dex volume exceeds um centralized exchange H sorry exceeds exceeds spot Dex volume um I'm not sure that will happen and one of the reasons is um it seems like to me like a no-brainer for spot uh volume to

happen on decentral exchanges it's just better if you if we were to reduce the costs and the um you know and these inefficiencies or whatever like you know just this is a crypto natively crypto asset like we should just traded like a natively crypto asset um once you start getting to derivatives especially derivatives say on on things that aren't on that same chain you have some advantages I think in terms of like you could have more decentralized oracles if you have derivative on a of a token that is also available in spot form in the same in the same place but once you get to other things like it starts to be a little bit less obvious that um that there's a huge advantage of doing it decentralized relative to centralized um you still have you know in some sense a uh you it's still non-custodial but yeah

so I'm I'm less sure and then there's also a lot of you know there's a lot of risk that comes from um from per a lot of uh uh and a lot more sort of ficky governance and like maybe it's possible it's just harder to get per um uh decks to be quite as like uh secure as uh or safe as centralized exchange one ones that said like centralized ones are not very safe uh there's a lot of risks including risks about custodial custodial of the collateral when we talk about centralized one so my my take is I think both will ultimately exceed I'm not sure which one will end up larger in the long run but honestly just like if you look at markets as well like derivatives the derivatives Market is just much larger than the um than bbot it's a there's a

lot more demand to trade a thing than there is you know to to trade reference in reference to thing turns out then there is a trade that they do the thing so I would guess probably it exceeds it undex as well all right I want to zoom out of some of the more specific episodes that we did and just ask you some of the big questions uh that we referred to our guests uh sort of time and time again and this was this was at the at the end of the episode that we did with Anna and lwig we got into this question there was a there was a little bit of a spirited back and forth actually between lwig and Anna about are we ever going to hey everyone wanted to take a quick second to shout out this season's partner Maverick protocol now many of you

probably know Maverick is an Innovative amm which they are but in reality they're a lot more than that as well Maverick is a suite of tools for defi users and builders that allows them to put liquidity where it will get the most work done since Maverick launched in March theyve been gobbling up market share and at the time of this recording which is the end of September on a trailing 7-Day volume basis Maverick is now a top three decks by volume and they support over 50% of the volume on the L2 ZK sync a chain Maverick enables LPS and token pairs to process higher volume with limited tvl which allows them to support some of the highest levels of capital efficiency for lsts like like rap Ste another very cool feature is something called Maverick boosted

positions so that allows protocols looking to bootstrap their token liquidity to Target the shape of liquidity of any token pair with surgical Precision Maverick is backed by some of the leading institutions in crypto Founders fund panta coinbase Ventures Finance labs they are all backing Maverick in their Vision to revolutionize the next generation of defi daps and helping them build their liquidity in all market conditions click the link at the bottom of this episode let them know that I sent you ex guys bring price discovery on chain and I think Anna was the more optimistic one about that and lwig was slightly less optimistic um reversing stereotypes about uh you know Age and and Tech optimism so my my question to you is

like going through the season it was something that we asked at the the very top of the season but you know what what are your sort of current thoughts about bringing price discovery on chain and competing with the likes of uh you know our centralized counterparts binance coinbase Etc I think ultimately it's for for that that goal of mine to happen for Dex volume to exceed centralized exchange volume we're going to have to have price discovery of everything on chain um right you already have price discovery of U of longtail tokens that I think that happens on largely of like the you know the really really longtail certainly um happens on chain I think we we see from that just a lot of the signs of okay like Dex design

is different in a world where you're doing this onchain and in fact like some you know we I I've been having interesting conversations with um with Alex Lin we had as a guest about just like how actually some of the insights some of the uh intuitions you have for how to design a DEX for um uh stuff like ethereum is actually just reversed um or you want to do different things for for longtail when you have PR Discovery happening so I think that there'll be a whole you know the point there is there's something interesting in designing dexes for the long tail because that's actually that's the problem we're eventually going to face if we want to exceed you know binance volumes in uh in ethereum on in you know eth USD on chain is ultimately it's going to be how do we actually design

this so that price covery can happen on it um so yeah I I think ultimately it will um I think I think that's that's gonna be the goal but I'm not sure I'm not sure what that will look like um or or how exactly do it I just think it's important for us to achieve that goal of having primarily nonoral trading yeah I tend to agree with you um you know every time I said that there's someone on the comments said take a shot every single time Mike says I tend to agree with you so I gota go to stop doing that I to stop doing that um okay the other the other big question that we sort of continued to to go back to over the season is the presence of H passive stakers and specifically more pass or passive sorry passive LPS um and

specifically retail so you know on in one sense I think it's kind of a nice story uh for people to buy into on the other hand it's it's really how Unis swap got it start it it was such such a cool like zero to one magical moment for something that you could do with magical internet money right you could just be a passive Market maker um and people could just show up and trade and I think everyone kind of fell in love with that idea but now as you know we move further and further towards our goal of bringing price discovery on chain you know Market making is is first of all very tough um and it's also very active I would say so you know I think now as we're starting to move some of the the larger components of exchanges offchain um you

know people are starting to get question like hey I mean we're we're kind of disadvantaging the the retail passive Staker and you know we've kind of asked well well does that even really ultimately make sense because actually Market making is a really difficult job and we have big goals in terms of how much we want this industry to scale so where do you end this season thinking about you know sort of passive retail lping I think I I think I end up almost agnostic on it and so you know I think at times in my um Dex research career I've been incredibly um I've had believed extraordinarily deeply in in the importance of passive liquidity providing provision as a component and I think it was a key thing

that made unisoft B1 and B2 work I think it's it's important thing that makes unisoft B3 work I think the fact that it supports passive liquidity revision on it um and isn't isn't just entirely uh you know doesn't give up that that ability I think the most of the design of V3 you know is is a lot of it is is just is entirely constrained by okay we still need to be able to actually provide passive liquidity on this can't we're not going to just turn it into into a limit order book or something there's a lot of practical and and I think some some ideological reasons why I think that's important um and then but then I think you know I've also at times been really extremely you know saying okay like actually all that matters is um uh swabber is swabber like if that's if that's actually our

North Star then and right now in some cases it doesn't make sense to have passive liquidity provide liquidity for them then so much the worse for the passive liquidity and I think you know that's I think that's true in some situations as well and but then you know I think we're swinging back in some ways where you start to see actually it's very it is very hard um in some cases to uh to provide a similar swapper experience without without cic right I think people people have been pointing out this out the whole time um and you know I think you have to I you have to acknowledge it my my key point is like always is just important not to get too much religion about any of these things um it's important not to think you know because especially with Unis swap they had this big success with pass liquidity

and then B1 and B2 that that didn't stop them from saying all right like how we going to make the most best use of active liquidity and it may involve doing um doing this thing in B3 that that changes some of those uh of those principles for for why it might have worked earlier and I think this is this is an ongoing infinite game where you have um sophisticated parties uh making you know uh reacting acting reacting in both sides in ways that can't always be anticipated and the principle that that works very well for years may stop working this is just what it's like to design markets or to participate in markets and I think if you get too much ideology if you if you decide like oh I I have this principle that actually you know passive liquidity or amms or Conant product or whatever is the thing um

you're going to end up at some point being being wrong or being blindsided as opposed to thinking like just looking at the situation on the ground and being like all right what's actually the right move in this situation and you know I think I've being having lived through some of these shifts in ideology myself it's made me think all right it's actually pretty important to have you want to have the right North Star but then within that you can't have a lot of of juristic that you're that you're uh claing to too strongly that's what I what I mean when I say it's important not to have too much religion about passive versus active or amm versus clouds or or anything like that you have to like look at actually what's going on and a lot of the time the devil's in the details I think people talk about clouds

versus amm but you know there are some clubs that are that act extremely closely to to amm there some you know you saw be3 acts a lot like a club as we've talked about a lot here important respects and the difference you know it's not it's not something that comes up in these like big ideological discussions it's going to be some really finicky thing about how are charged or Howa are ordered somewhere deep in the logic here that like only one person implemen knows that turns out to make all the difference and so I think if you're not like deep in the details of these things if you're just saying like oh I see amm I believe in amm you know I believe in passive liquidity clouds it's like all right like you know um if you look a lot deeper I think everybody you

know working on these things closely and we saw this when we were talking with Doug um and Eugene is like they have much Nuance views I think than some of the people who are just observing it from a distance because again you notice a lot of the in practice a lot of a lot of the time these things change and um and things are less clearcut than me might think yeah crypto is a funny industry for ideology and you know if you think about something like Bitcoin why that specific ideology formed around decentralization is because the purpose of that app spe basically is BIC Bitcoin is kind of the first app chain it's the money app chain and the reason why it didn't it was uh so religious about enforcing the particular properties of decentralization that it did was because that's what was needed for decentralized

money because there's a lot of risk of it being s shut shut down by the state but I think even you can see this in you can see this in ethereum a lot they they kind of inherited a lot of those same uh those same ideas very specific ideas about decentralization without maybe questioning like hey we have a sort of a different Northstar EnV Vision what level of decentralization specifically is appropriate but because I mean the history of crypto 2 is like very small nuanced technical differences that people have a hard time getting anyone else to pay attention to so they kind of drum up this big you know sort of values based uh reason for why people should care and again I'm going to go back and shill this these old episodes around the block sck people go back and listen to what people are saying during the block

siiz war I find it extremely interesting so yeah yeah it's so I I I don't tend to agree with you I just agree with you so I think that sounds good so what C be useful for is I think when you have these these degenerative equilibria when things you know things will go in One Direction you don't stop it sometimes like just having religion and ideology and having people be like we're actually going to stop this even though it's rational and even though it maybe seems to make sense because we have this weird principle it is it can be useful to actually have people do that I think meev is one example there have been times where we've been at risk of like you know veering off the Mev Cliff toward like toward incentivized rears for examp one example and then you end up with people just being

like that this that we're g to draw a line here sort of maybe maybe it's not maybe you know it doesn't make sense to draw the line here maybe we should have drawn the line somewhere else you could make a rational argument for why everyone should do this but we're just going to say you're not allowed to do this and then like people people for maybe religious reasons agree and then you end up in the spontaneous order that maybe it's better than you would have otherwise not enough so I don't I don't mean to Discount obviously all of crypto is about is basically a religion about okay we have to believe this stuff is valuable and if we all believe it then we um then it will be um and similarly again we all sort of have to act despite saying know you don't have to trust

anyone you sort of I have to trust like the whole system and people will some not always act in their own individual rational self-interest but sometimes in a broader interest that you might call religion but I think ultimately again like that when when that gets into like oh I better not add this feature to my to my decks because um you know some some feature whatever I think it can it can end up um sort tampering actually the ution those SP yeah uh last last last question on this vein is we got into this a little bit with with Hart where we talked about multi-chain and bridging and intense and the role that it's like every buzzword in one but the role that market makers have there and you know I guess just to get your sort of final verdict we've talked about this a good amount explicitly sort of need to

spend a ton of time but you know I think when you look at basically interop and especially cross chain has been a much more difficult Thor problem than people originally thought it was going to be like if you rewind the clock five years and listen to some of the discourse just assume we'll just figure bridging out and now honestly some it feels like bridges are starting to converge actually around I know you wouldn't call Unis swap x a bridge but we did talk about the the similarities between cross chain dexes and bridges and certainly the across model seems to be something that other dexes I'm starting to see converge around as well but uh you know we're relying on market makers to basically act as um you know definitely sort of managing the inventory problem the financial inventory problem across

these different uh trust zones so to speak so I mean how much do you care about think about um consider it potentially an issue that we're relying increasingly on market makers in the design of a lot of these products yeah so I think you lot of these systems you end up with this sort of silla and corbus where you you have to pick one kind of centralization or I don't know centralization is the right word but there's there's one sort of one of these risks that is the same type that people complain about one of them is um one one design for something is we could say we're going to have a perfectly competitive market we're going to design a system where anyone can participate and the best participant wins and the other is um we're going to basically

have uh uh just one trusted one party that that plays this role and we're just going to trust them that they can that they do it properly um and I think you know some systems you know for example in the former you know Bitcoin mining is one example where we just you know it's just a globally competitive market um ethereum mining um meth extraction on on chain um in some way in some ways you know is perfectly competitive um you know when you when you have like a PBS the Builder Builder competition right you have this competition um and then some examples of the the latter are like you know uh L2 um a sequencer you know two sequencers where right now we have you know uh generally there's a single party that is justed to sequence uh sequence transactions um or blocks and um you know there's there possible

abuses that they could have there but we uh generally the system trusts uh that these parties won't do that and I think both of these you know the former you know sounds really good but often what it means is this ends up going to whoever in the world is best at this which may not be the person you would want to be running it might be like whoever who's best in the world at high frequency trading turns out to be the person who is now constructing blocks right um yeah and so you know I I think there's there's uh places in the you know in crypto for both of these systems but I think it's worth it's worth noting that that's when we talk about a perfectly competitive system where it's just like we're gonna have no barriers entry um and just say like it's

perfectly competitive means ultimately like we're going to actually we're going to basically trust this to whoever is best at it um and you know I think in some cases that can have that can have weird lateral consequences um and you know I think I think this is one case where sometimes there's this yes some that that there's this price of Anarchy where if you have this competition uh um then actually like you know there's it's not socially optimal um and I think this is that's this is one example you know the rise of like integrated search Builders um as one example is is where we might not have we might not have wanted it to happen but it's a consequence of just having actually um this open competition and total decentralization and then the other end of the spectrum you can have single trusted parties that like that do

everything right you know I think mostly uh uh I think most of most parties that that have done this like mostly seem seem like they're not you front- running users I don't know um uh but like people do it but we say we don't actually want just to have like a single trusted party right and so maybe there's there's places in that Spectrum to go but I think it's important to note that that like the alternative to anyone you know anyone can compete uh this meritocracy is like potentially you know benevolent dictatorship or that's that's the that's the other end the Other Extreme end of the spectr and both of those can lead to you know so when you're talking about oh we have this problem of you know um uh like that causes centralization I think ultimately that's it's just because like whoever is best at if you have a

meritocratic system that design seemingly sort of Pop uh perfectly that can mean that whoever's best set it just ends up not running it rather than whatever you so rather than deip you might say like this is this is the comparison between just like meritocracy or competition and democracy right one where it's like everybody just chooses who the sequencer is and then we just trust that Secrets there and maybe we can we can replace them it's not necessarily dictatorship um yeah but and it's I think there there's places for both of these kind of Dynamics but both of them can be criticized you maybe rightly as as having some aspects of centralization or centralizing pressure yeah well I the way that I also think about this is if we're building new you know new Financial infrastructure here that just requires the participation of professional actors I think I think and

this is where it's important like look if you're G to be like value the values driven religious part of crypto I think you're absolutely right there's huge benefits to that but I but I also think it shouldn't sometimes you can make a worse ultimate like the decision that you make if it's values guided can ultimately end up being worse because you're not particularly like realistic about what the outcome is going to be and like this is where I actually remember listening I can't remember who said it anymore so I apologize I don't mean to drag your view here but I remember someone describing how Dows were so great because permissionless participation anyone can just participate and I remember thinking makes no sense to me imagine if Apple tomorrow was like anyone can just be an employeed apple be like would you would you be more bullish would they build a

better iPhone like I don't think so so I don't know I think there's you know layers of compromise uh that will lead to a better outcome for everyone that's right I I tend to you know especially in Market design when designing markets I think just um a global perfectly Fair competition seems like the right the right just general principle to be designing around um but you know again I think I think there's I think there can be cost of it I think you right to point out like this can this can tend to have centralizing effects and so figuring out what what the effects are is important but yeah and I think ultimately if we if we just wanted to work as well as possible then I think we sort of have to say like all right we're gonna get whoever's best at this to be doing it

you were willing to accept that other people might not be and so end up they will end up providing that service anyway and maybe they'll be doing it in some other system totally totally all right um last couple questions here but I I would love to just get you you know we talked a lot um you know in in a tertiary way but also had some some folks on the Unis swap team uniswap X Shin on earlier this season and I would just loved to get a sense of I anything you can tell us about you know uni V4 Etc like it was very it was very cool to talk to lwig as a builder of a hook I actually ended up talking to a couple of other Founders building hooks on Unis swap it feels like that's actually quite Rich uh as an ecosystem it was

actually a question at least for me going into this season about okay it's very cool sort of platform design how many people are gonna end up building hooks especially talking to Ludwig even off air it's like man this a extremely you know he was just very convinced very compelling value proposition and it feels from from my vantage point like actually are having a lot of people build these hooks so you know what's the update on on V4 yeah yeah so I think B4 they're they're checking along it's it's an extremely difficult cont to get right and so I think the security you know the the put it through just you know maybe one of the most extensive Audits and security um uh uh reviews that of in ethereum history um eum contract history and so I think that's you know that's

one thing that's that's G to push back but I think ultimately yeah I think they're you know they're the utof team and I have just been incredibly excited as well about seeing all the um their uh interest in building on top of it and I think that's that's something where you know we just maybe uh what I love about it is it's it's Unleashed this kind of wave of innovation of unisoft that I think we hadn't seen to date in part because I think just unof hadn't quite designed um to be modular enough so that you can add these other improvements on top of it and so yeah so I'm I'm really optimistic about um about a lot of the projects that are um uh building on top of it and yeah I think really yeah I think I think hopefully yeah we we'll see we'll see I I really hope the

dominant the dominant hooks are something we would never have expected um and I think that's that's you know what makes it exciting to me yeah um all right Dan uh you know we've made it through many episodes here many hours of questions uh and I've saved uh this one for you uh Best For Last is there ever going to be a uni chain you know are we ever gonna get uni chain this is the long foretold H Dan ellz thought piece from a while ago you know it was as I was I was listening to Antonio in that interview I was like man it's it's pretty compelling value prop from the perspective of of a of an of a of a deck so I mean I know you can't uh there's a lot you probably can't reveal but I mean how do how do you feel about the

perspective of a potential unit change yeah I think I think it could I think it could make a lot of sense um and you know I don't think I I don't think I have that much more um information on this really than uh than anyone's that been put out publicly um so mostly I'm talking here just for from my own opinion and and from first principles to me what's important I think is um you want to ultimately for a for a DEX chain to make sense the really big challenge for it is is the on and off ramp is getting people onto it and off of it um the amazing thing about Unis swap um on ethereum is that your money is already there so when people started using tokens um on chain for other things when the summer started happening the The Exchange they wanted to trade it

on wasn't you they didn't want to have to like go deposited and do a centralized exchange and then and then trade it and then and then move it back um they wanted to be able to to trade it right where right where it was so it's actually fewer transactions and it's cheaper and simpler to be able to just trade it onchain I think that was incredibly important for the rise of Dees at all um I think the if you have have a a DEX chain that is just for people to go on live on that chain and speculate on uh tokens there it's you know in the way that people do with centralized exchanges it's a huge use case bigger than it's bigger than Dex trading right now people doing this on centralized exchanges right and so I think that's I think that's great but to

me like the thing that I would really love and is really important for that to be able to work is this cross chain experience the ability to say I'm gonna buy a token on that chain even though I'm I'm actually not um my assets right now we're not on that chain so to me having a really good you knowof cross chain experience um is I think like maybe the most important unlock and luckily I think unisar back cross chain is is a fantastic design um and it's and the that I think is GNA is going to really unlock a lot in terms of just in general interoperability in moving assets between chains um I think yeah that that's the kind of thing that unlocks like you you could have you could imagine having like the main unisoft chain not being on U on aum1 that requires again that people still be

able to use it as if it is or or without that much experience degradation as if it is and I think that requires cross chain experience yeah all right well Dan this has been a phenomenally fun season again a Bittersweet that it's that's coming to an end but um I think we did some hosted some really good conversations and hopefully move the dialogue forward in terms of lever Dex design a whole bunch of stuff that we talked about so um you know I appreciate it um yeah we'll have to have you back on in in future bell curve Seasons um I I will promise you an episode all on Dutch auctions so we can get into the Wheats there at some point but yes a lot of fun thanks so much Mike for inviting me to co-host I mean I think you know Mike Mike did uh by far most of the work

and got most of the guests on and I think just to for me to be able to join this and and talk to some of my favorite people in the industry about uh these topics that I'm really interested in and be able to blow the depth about them um uh in response to to open Ed questions from Mike who's fantastic interviewer and so I thanks again for having me on I think it's been it's been a blast um no pun intended and uh yeah I'm hopefully I'll get to come on again in in a future season as a guest absolutely my friend standing invite um all right cheers