Dispelling WETH "FUD", ETH staking on fire and more - The Daily Gwei Refuel #496 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of The Daily way refuel where you cut the latest news in ethereum ecosystem I'm your host Anthony sassano and since the 29th of November 2022. all right everyone let's get into it so apologies for missing yesterday's episode everyone it's kind of late notice but I did give notice in the daily grade Discord Channel if you're in there you'll know whenever I plan to miss an episode uh but yeah sorry about that but we're back into it today of course and the first thing I think that's worth talking about is the I guess oh I wouldn't really call it fud but like I guess the topic of what happened around a wrapped ether or with over the last few days now the reason why I'm bringing this up is not because I think any of you watching or listening

needs to maybe have clarification on this or maybe you do I'm not sure obviously but the reason I want to bring it up is because it really got out of hand which was kind of wild to me so basically what happened was that people were making jokes about how wrapped ether was insolvent or that it was suffering from a hack or it was going going to zero and then there could be a bank run you know all the same things that we've heard for other things in crypto that actually turned out to be true right such as FTX so obviously the joke uh wasn't really taken as a joke by many people especially people that don't understand how wrapped ether works and they thought that there was something wrong with it now I participated in these jokes in this [ __ ] posting and I

apologized for it as well because I just really underestimated that uh the fact that people would take this seriously so you know with that background out of the way I do want to quickly break down why they I mean why something being wrong with wrapped ether is extremely unlikely and why it's actually different to other wrapped assets on ethereum such as wrapped BTC or wbtc so how does rapt ether work and why do we even need it in the first place well the way it works is that rapt either is a a contract that lives on the ethereum network that contract basically has only 62 lines of code it is extremely simple uh it's an extremely simple smart contract and what those lines of code do is basically allow you to convert 8th into an erc20 token or at least make it so that it

adheres to the elc20 Token standard that we all know and love right all the tokens on ethereum or at least most of them adhere to the erc20 Token standard uh and then it lets you unwrap that as well but basically all it does is take in the eth store it in the contract and issue you the corresponding wrapped ether it doesn't do anything else with it the contract itself can't actually do anything with it doesn't in it doesn't have any lines in its code to allow it to do anything with the except except rapid unwrap based on the amount of eth given to it so if you want to go on redeem you would basically bring one wrapped eth and you would get one eighth back that's it there's nothing more to it that's as simple as it is now why is this a thing like why is rap day through

even a thing well because eth is the only uh sorry I shouldn't say only but atheist as an asset does not adhere to the erc20 Token standard because it came before erc20 erc20 was actually invented as the token standard after the ethereum network went live uh and it doesn't adhere to that so because of that eighth can't really be used natively within a lot of these uh D5 protocols and other such things so to use it natively you wrap it as and turn it into wrapped eth and then it unlocks all the relevant erc20 functions because it is now because rapt ether is an erc20 token right adhes to that standard so because of that and because of it's being so simple the chances of this being something wrong with wrapped ether are

extremely unlikely it is not possible for there to be a bank run on uh wrapped ether it is not possible for it to be insolvent it is not possible for the wrapped ether contract to lend out the funds to you know anyone else right or anything like that and but that's that's uh that's um uh assuming that the wrapped ether contract is functioning as it's programmed to do which it has done for as long as it's been around for there's never been a bug as far as I know that in wrapped ether I think if you really want to dig uh dive deep into it there is a very technical thing that someone put a thread out the other day day about wrapped ether that basically means that there's one way so one way is literally like the smallest nomination of of eth that uh is I think stuck in

the contract one way which is obviously like beyond the rounding error it's I mean not even worth worrying about and it was due to some esoteric thing but it doesn't have any bearing on the collateral in um backing up the wrapped ether right so the only way there could be something wrong is if for some reason the wrapped ether contract was exploited and that exploit would it would have to be uh something like taking all the eve out of the Raptor if the contract so that the wrapped ether token wouldn't be able to redeem the corresponding eighth now as I said the wrapped if the contract has been around for a very long time it has a massive honey pot there's like four and a half billion dollars worth of eth just sitting in there so if there was to be an exploit it probably

would have already been exploited and as I said because it's only 62 lines of code it's very very easy to audit at very easy for anyone to really read even if you're not a coder you can actually read that contract and get some sense of an idea about what's going on it on with it but basically and it's very easy to formally verify uh and obviously there's been tons of eyeballs on it both because of the Honey Pot and also because of how uh how um intrinsic it is or so how important it is to the rest of the ethereum ecosystem so yeah if you sell any of this fud or any of this wet stuff over the last few days just know that it was all jokes there is nothing wrong with wrapped ether um as it currently stands I don't expect there to be to for there to be anything

wrong with it for the reasons I just outlined uh and on a final note here I do want to say that I do realize that you know [ __ ] posting sarcasm joking doesn't really come across with text and I've had and I've learned this lesson many times over the past few years being on Twitter uh I do tend to [ __ ] post a lot on Twitter and make jokes a lot I don't know it's just something I do for entertainment it's fun for me I keep the educational serious stuff for for the refuel uh but I think going forward I'm gonna be more careful about it because I honestly didn't realize like how sensitive people were to these things and I should have because the fact of the matter is that there's a lot of new people in the ecosystem even in the bear

market and obviously due to all the Fallout that we've seen from things blowing up they're a lot more sensitive to this stuff now like anything that people call out as being fud or call out as being wrong immediately people are skeptical of that because there has been things that have been called out as fud like Celsius blowing up like FTX blowing up and it turned out to be true so I totally understand that but uh but yeah the the joke seem to take on a life of its own it even got covered in like Bloomberg I was like what the [ __ ] like why is it covered in Bloomberg but anyway lesson learned hopefully uh the way I just explained how it works is educational for you and you get a better understanding of it but that's why it is different to things like wrapped Bitcoin

which I should explain actually so rat Bitcoin is basically an IOU it's not a smart contract so what ends up happening is that if you want to wrap your BTC your native BTC from the Bitcoin Network into wrapped Bitcoin and erc20 token on ethereum you send that BTC into the into the custodian which is bitco they issue a corresponding grabbed Bitcoin to you on the ethereum network and that's it all the BTC is actually custarded by Bitcoin it's not custody by a smart contract so bitco is the ultimate source of that BTC so if something happens to that BTC in bit goes vaults for example uh on the Bitcoin side the wbtc uh IOU would be worthless because there's nothing backing it up it's like how I've explained Bridges before how when you go

to another chain uh there you know you'll Bridge your asset to another another layer one it's an IOU because the asset's still living on ethereum whereas because Bitcoin is a separate Network to ethereum and you're bridging across your BTC all you're getting is an IOU IOU you're not literally taking your BTC with you and there has been other attempts at basically giving you BTC where it's basically permanently locked or it's it's uh there's um uh it's called hclc I think hash time lock on on bitcoin I'm probably saying that wrong but there has been other attempts at doing this in a more trustless way where you didn't have to trust the custodian going from Bitcoin to ethereum but yeah right to bitcoin is by far the biggest solution out there and there is reason why uh wrapped Bitcoin is very is very very different to wraps ether is that

difference in what it uses for custody wrapped ether or The Ether backing it is custarded by the smart contract that anyone can audit the code for as I said the code is extremely simple it's been around for a long time you know there is near I mean I'm not going to say zero percent chance but there is basically a zero percent chance of anything being wrong with that whereas at the on on the bitco uh sorry on the right to BTC side of things bitco custodies all that BTC so if anything wants to happen to that custody then the wbtc uh a portion of it all of it would be worthless on the ethereum side now the thing is is that if the wrapped Bitcoin on the ethereum side gets stuck or I get seized or I don't know maybe not get C's but gets stuck what can

happen is that the bitco can or the wbtc custodians can basically freeze that and then just reissue it just like our tether can reissue tether uh depending on if it gets stuck or it gets um it gets lost or or whatever something sends it to the burn address accidentally the ultimate source of collateral is on the Bitcoin side it's in the bitco cut City vaults whereas with um ethereum if someone loses the Raptor so say you send one wrapped eth to the burn contract well that one eighth in the wrapped either contract is stuck there forever there's no way to actually get that out now because you've burned the thing that was the IOU token because technically wet is an IOU token for the eve but because it's in the smart contract and because you can verify that it's there you don't have to trust anyone right

it's actually truly trustless and decentralized um so yeah hopefully that explains all of that and the differences between those things I'm going to leave that one at that and move on to the next thing which was some news out of binance so this happened a few days ago but binance has released their proof of Reserve System that they've spoken about and as you can see here tree of alpha says starting with BTC every user can verify the assets they earn on binance using a Merkel tree and then Jesse Powell said I'm sorry but no this is not reserved this is either a proof of reserves this is either ignorance or intentional misrepresentation the miracle tree is just hand wavy [ __ ] without an auditor to make sure you didn't include accounts with negative balances the statement of assets is pointless without liabilities so what and then Jesse continues I should

say by saying you know this is simply here's a hash of your record in the BTC spreadsheet okay but what's the point the whole point of this is to understand whether an exchange has more crypto in its custody than it owes to clients putting a hash on a row ID is worthless without everything else and this is a very important point that I think more people need to be aware of as I've explained before proven reserves is good because it gives us more than we've had in the past it's also good because we get to actually see which addresses uh these exchanges control and use and that's good for cataloging and things like that but in terms of knowing whether an exchange is solvent or not approval reserves is is nowhere near enough because you don't know what their liabilities are so for example say an

exchange has one billion dollars worth of reserves okay that's fine what if they have two billion dollars worth of liabilities well they're actually Net One net negative one billion dollars so they their proof of reserves is is all well and good but if they can't pay those liabilities those reserves go if and if for some reason they file for bankruptcy those reserves doesn't don't mean [ __ ] those reserves make a part of the bankruptcy process and they probably get used to pay back those liabilities so at the end of the day if you don't know what the liabilities are which is pretty much impossible to know on chain then a proof of reserves Miracle tree is kind of pointless because you can say oh yeah I have a billion dollars worth of bitcoin here's my address that you know here's the exchange address that's

they're being custody on his proof and you know basically showing the proof on chain that's fine but can you prove that you don't have more than a billion dollars of liabilities uh issued against anything you could have lent out money right uh you could have bought uh sorry you could have um uh you know you could have lent out money you could have borrowed money you could have done something funky with other assets that you own all these sorts of things can happen right and we saw what how it plays out with FTX so it's not enough to have proof of reserves uh at all and honestly it sorry sorry I shouldn't say it's not enough to have proof of reserves it's not enough to have proof of assets true proof of reserves is assets uh minus liabilities and if you still have all the assets there

especially customer deposits after you pay you know pay down your liabilities around after your account for liabilities then you have a proper proof of Reserve System but as I said it is impossible to prove your reserves on chain because you there is no way to prove your Fiat um things on chain for example you can't prove to someone that you don't have a billion dollars a Fiat liability you can't prove a negative uh and and I mean you can you can you can say as much but you can't prove it because you still have to trust you right with but that's why you know in the traditional Finance system people get third party Audits and things like that as well uh but even third party audits can't be trusted as we saw from the 2008 financial crisis there were third party audits but it turns out that they were getting uh you

know Kickbacks for giving good audits through junk bonds and and and kind of like uh uh junk assets and junk mortgages so when you look at it from that perspective D5 looks even better because if I can actually do proof of reserves because you can actually look on chain and see which Protocols are actually solving and which ones are not which ones have bad debt debt which ones do not like last week we saw uh are there um I experienced a kind of attack of sorts uh on its um on its system and it ended up with about a million dollars I think of bad debt but you can see that and you can prove that on chain there's no need to trust anyone there but there's no way for us to do that off chain or and in CFI it's there's always an element of

trust there whereas because defy a truly decentralized Finance I should say is trustless his own chain is available for everyone everyone to verify you can see what's happening in real time you know what's even funnier you can actually see immediately when something's been hacked whereas in C5 the platform can get hacked and you probably won't you know there's a potential for you not to know for a very long time this actually happened with mt gox they were bleeding BTC for for a long time against their liabilities which was customer deposits and they were trying to make it back they had this bot that was running it was all manner of kind of craziness that was going on right um and that only came out months and months later whereas in D5 you know instantly if something's been hacked

because someone calls it out instantly all you have to do is look on chain and instantly you're you're aware of it and that to me is another massive value Prof yes obviously we don't want there to be hacks in D5 but I think the value prop is in being able to see what's happening on chain being able to follow the money so to speak and not having to rely on anyone not even have third-party Auditors who are supposed to be legit and who you can supposedly trust it's all about building a trustless financial system not building one that you have to trust uh you know certain parties still so yeah I'm glad Jesse called this out because it's a very important point and I think that when discussing proof of reserves in the future you always need to say that it's assets minus liabilities if you just want to prove assets that's

fine call it proof of assets but that doesn't really give you much as I just explained and on this note as well coinbase also I put out a blog post titled how crypto companies can provide proof of reserves and they've also announced a 500 000 developer grant program to encourage others CRS and their tldr this blog post is that as a public company coinbase already proves our reserves using our audited financial statements we're also exploring various novel ways to prove reserves using more crypto native methods and are announcing that developer grant program on chain accounting is the future but as we discussed in this post there are pros and cons to the various ways this can be implemented today uh which you can give a read I'll link in a YouTube description below uh but again right like they're saying here because

coinbase already proves our reserves using our audited financial statements that's fine right and I don't I'm not saying there's anything wrong with their audited financial statements um and I think coinbase is obviously legit but again you're trusting those financial statements you're trusting that the Auditors have both done their job properly have been truthful aren't trying to obstacate anything uh and and that that you know everything's above board and they don't have any Rogue employees doing uh dodgy things or anything like that right so it's obviously much better to have the audited financial statements than not but still it it doesn't even come close to the value prop of being able to audit the things yourself and verify it for yourself on chain without you having to rely on anyone else and that you know as

I just explained that that's the that's the power of of defy and on chain Finance there but yeah you can give this blog post a read I'll link it in the YouTube description below all right so uh this might be old news now but we all saw the metamask uh stuff from last week metamask and Furious stuff from last week that I covered on Friday's refuel but Mystic region here put out a great tweet through where he said so metamask says quote unquote just don't use inferior so let's see how easy metamask makes it to quote unquote not using fira part one installation the first two screens are straightforward here they seem to provide a clear privacy policy that's good and then he continues this thread by walking through creating an account on metamask now the most egregious thing about metamask is the fact that it does those batch uh

sends right where basically batches all your addresses together with an IP address audio theme addresses with an IP address and sends that straight to inferior in order to do things that improve the user experience such as showing balances of tokens and things like that right but that is obviously a very easy way to dox you in all the addresses that you use because it's sending it all as one batch thing it's tying it to an IP address um and if you have your public.eth linked to your sorry controlled file your metamask well then that's going to be linked to all your other addresses and there goes all your privacy from I guess inferior and metamask and if they're logging that then that could potentially become a a thing later on where uh maybe they get hacked and that gets leaked and it becomes really bad

for privacy so that's the main thing uh but yeah I mean I suggest reading this giving this thread a read because it goes through how you can change your RPC but it's kind of useless because you can't change it before you create an account so instantly you're sending all your data to inferior anyway and you can't actually remove inferior from your metamask uh you still have ethereum mainnet when you when you have your list of drop down rpcs you can of course add your own but you can't remove ethereum mainnet from the extension now I'm sure men ask is probably working on ways to remove it given this public outcry and hopefully they're working on ways to uh to avoid that batch sending to you know the potential docs Vector there but still I think it's worth giving this thread a read all Link in the YouTube

description below uh for you to check out all right so the other day uh protocol Guild had its one year anniversary so they said today protocol Guild is six months into the 12-month pilot uh with uh so yeah I should say that the they they started the protocol Guild I guess uh initiative in terms of getting something spun up uh which eventually became the protocol Guild uh uh you know on October 29th 2021 so over a year ago now um but on November 26th uh they say today protocol Guild is six months into the 12-month pilot with 10 million dollars vesting to 109 core ethereum contributors updates coming soon stay tuned planning what PG V2 will look like and you can view the dashboard as well

which I'll link in the YouTube description below but this is so awesome someone said this in in the Discord Channel today about protocol Guild and I think it was frozen fire he said that basically what the protocol did was that it made core ethereum contributors uh uh unionized basically so they're not just reliant on these uh big organizations like the ethereum foundation census and some others out there to fund them that basically said well no we're going to take our funding into our own hands and we're going to basically create this protocol Guild thing we're going to be a part of it we're going to get the projects in the ecosystem to buy into it to basically donate to it and then we're going to invest out this money to core contributors in order to get them paid for their work and I think it has worked

wonders I mean there's already 10 million dollars vesting and this is just the pilot program uh to 119 core ethereum contributors and I think that works out to about 80 000 each it's not it's not weighted uh the same for everyone uh there are people who get more weight than others uh as uh as obviously people do more con you know contribute more to ethereum core development than other people do uh but yeah I mean that's a huge amount of money going to the contributors of the protocol that we all know and love now is it enough no and I think the protocol Guild is targeting one billion dollars like they really want to get to a billion dollars 10 million dollars is the pilot hopefully they can keep 10xing that right go to 100 million then go to a billion potentially even 10 billion

one day and that would be amazing because it means that these core contributors don't have to rely on the ethereum foundation they don't have to rely on consensus they don't have to rely on going and getting outside funding from from elsewhere uh and it'll make it a much healthier core development ecosystem as I said it'll make it like they've unionized which I think is very very powerful because they not only have the money they also have more bargaining power where they can basically say well you know what I don't care if you don't pay me right I'm go and and maybe one of these uh companies that are funding them says hey we want you to implement this or we want you to push for this and the team says well I we don't feel comfortable doing this and then the organization says well we're

not going to fund you if you don't do this they can say well screw you guys we're going we will get funding from protocol Guild so it works as a deterrent for that as well not that I think that's going to happen but it doesn't matter if I think it's going to happen or not it has a chance of happening right there's always a non-zero chance of happening so it acts as a deterrent while also rewarding core contributors so I mean as you guys know is one of my favorite things in the ecosystem I've donated to them through my nft drop uh well actually the nft drop that I did for the daily wear one year anniversary went to a similar effort to the protocol Guild because it's also paying out core developers but I also sent some tokens from SSV Network that I got recently to protocol Guild I

didn't announce that because I didn't want to make a Fanfare about it I think it was worth ten to fifteen thousand dollars at the time or something but I donated that straight to protocol Guild because I didn't want it um and then I've mentioned before once I get hopefully if I get voted into the rocket pool oh Dale and start accruing the rewards there I can pass them onto the protocol Guild as well so you guys know I'm a public goods funding maximalist I love giving money back to the ecosystem and the protocol Guild is one of the best places we help to do that so yeah congrats to them on being six months into the 12-month pilot looking forward to seeing this 10 million number go up and up and up all right so we've got a new uh little uh uh I guess like tool here from Xerox

and GMI who says now you can check which rpcs track your IP on chain list so a chain list uh basically is a website yeah you can go to chain list.org chain slash one which basically shows ethereum and on here you can see uh that they've gone through all the rpcs and checked their privacy policies manually then we simplified those into simple badges so green doesn't track IP orange limited tracking red tracks your IP and none no no definitive statement I think this is really cool because basically you can see which ones uh have a really great score so the only one that has a definitive um a statement on uh on green on privacy and greenupt doesn't track

you is this one here which is no real dot IO so this is their eighth main net are the other ones that have PRI that have a green score yeah uh uh sorry don't track your IP I should say um our uh uh these other ones here so there's a few this list keeps refreshing um there's a few here but a lot of them don't offer uh very much privacy unfortunately but you can use one RPC uh which I think is one inches RPC there uh and uh node reels RPC which seemed to be the two that uh that don't track you and and respect your privacy here but I think that uh orange is uh what was orange limited tracking so limited tracking could involve uh not tracking your IP at all uh and they've actually got their policy here when you highlight

it it shows you exactly what the policy is so I'm not going to read them all out you can go check this out for yourself I'll link it in YouTube description below but great to see that the community came together to develop such a tool so quickly because I mean as I've said before the meta mask inferior stuff is starting to be taken seriously obviously if you care about your privacy you want to know which rpcs are not tracking you which ones aren't logging anything and which ones uh are respecting your privacy all right so uh agile here who's a designer Paradigm announced that Paradigm is sponsoring orc Webb and Jake to build open source libraries to accelerate web 3 front-end development this is really cool because front-end development doesn't really get too much love in the crypto ecosystem unfortunately well now Paradigm is

sponsoring uh Tom meager and Jake Moxie to focus full-time on wa GMI or we are going to make it which is a front end a development framework I believe for ethereum and other networks yeah so this is really cool I love to see these VCS and these funds put more money back into the ecosystem especially the public goods so to speak or the open source public goods that people are building and I've spoken about you know how Paradigm does this before with a bunch of other things but I think that some people last week and maybe the week before we're trying to paint Paradigm as some kind of I guess a villain or something I mean I think it had to do with the FTX stuff and obviously they're an investor in flashbots as well I believe but I don't think Paradigm is a Villain at all I think that they really

do care about the ecosystem yes they're a VC but they've given a lot of money and knowledge back to the ecosystem actually you know that's what it was about Paradigm what was the um stuff around nakula and the um the ref client that they're building the drama around that but I discussed that last week I'm not going to rehash it but I do think they're a net positive for the ecosystem I mean as I said before there's not there's actually very few VCS and funds that I would ever say are net positive for the ecosystem because I mean just by virtual incentives most of them are extractive because they're VCS they're fun they're expecting a return on their investment but I think that you can still be extractive to an extent but then also give back to balance that out remember how I discussed those scales

before you can extract all this value in terms of funding things getting access to obviously discounted uh tokens and stuff like that right but then if you balance it out by giving back uh I think that uh you know once you kind of I mean it's it's hard to like it's debate of what the exact balance is going to work out to be but if you do attempt to make a balance there I think it's much better than a lot of the other players in this ecosystem that we've seen a lot of the other funds in VCS that just don't give anything back back and just extract as much money as they can they fund literal scams they fund just really bad projects out there um and yes as I said Paradigm is funded questionable things before and outright frauds like FTX obviously um but you know I think that as a VC and

as a fund you're going to invest in so many things not everything is going to pan out and that's what to say that I think that they didn't make a mistake investing in FTX obviously they did and they didn't just invest invest once they've invested over multiple rounds but I think they're giving back a lot to the ecosystem so I try not to to um uh to kind of go after them or too hard or anything like that because I want them to keep giving back to the ecosystem and I think they're doing a lot of great work within ethereum and uh crypto uh more more broadly all right so this was true on the November 26th so three days ago had to go now but I said 300 000 eth has been staked over the last 10 days so there's a lot of eat pouring into staking and I

think it's because of that APR bump that we've seen which basically doubled APR if you're running Mev boost and collecting the execution layer rewards of both Mev and normal tips and I think the API is what eight nine percent um and it can go higher depending on if you want to do recursive staking if there's token rewards but I'm just talking like pure Easter nominated from staking you know plus Mev boost of course I think Mev accounts for a lot of rewards there uh but yeah there seems to be a lot of E's still entering staking here now contrary to popular I guess narratives recently where people have been saying oh you know all these people are locked in staking and I feel sorry for them because withdrawals aren't enabled yet blah blah blah as I've said before it's a completely voluntary thing

and you know a lot of the network isn't locked into staking because right now I think steth is only at a slight discount our Eve I think is not even not at a discount CB eth is at a I think five four five percent discounts obviously not nothing but if people really wanted to exit they can if they're staked through those those providers right the solo stake is I haven't talked to not one and I talked to a lot of solo stickers I haven't spoken to one of them that gives a [ __ ] about withdrawals for for anything other than being able to withdraw their Awards so they can pay their tax obligations that's it they don't want to withdraw their stake they want to keep staking and and it's just funny how more and more stake enters the system well obviously people aren't

concerned that they can't withdraw from the beacon chain and as I mentioned on on Friday's refuel withdrawals are coming probably sooner than people think we're probably going to get them in March or April right I'm not going to commit to that but that's the signaling that I've seen so if that happens I mean it's literally like four or five months away it's not that long and but as I said like no one's banging at the gates for withdrawals the only reason people would be banging at the gates for withdrawals um that I've seen and and not uh because it's not because people want to withdraw their eth it's because they want to withdraw their Eid from centralized providers and go to decentralized ones because of the censorship concerns because of the um centralization of State concerns uh because of the Fallout of FTX as well the custody concerns

right so they they want to go a step further and they actually want to contribute more to the ethereum network in terms of decentralizing nation and security they don't want to exit staking and just sell their eighth and go on their merry way and the funniest thing is is that if you were to look at it from a pure profit perspective uh the first stake is got into he's taking I think Heath was like four to five hundred dollars uh and then the majority of them have staked uh you know after uh sorry the majority of them have staked their eth at prices that were much higher than that and prices that are much higher than where they are today so unless you think these people are going to unstake their eighth capitulate on them and just sell then I think that it's a bit stupid to think

that like we're going to have this massive kind of thing where people are clamoring at the the gates to get their eat which they haven't been I haven't seen it personally but yeah just just cool to see more I eat being staged of course and and uh you know uh obviously actually I should mention as well I I do say it's cool to see more eat steak but I think Super fears had a great tweet out the other day that I don't have up here he said it doesn't matter if more eat the steak if it goes into centralized providers it doesn't really add much decentralization or security to the network um and obviously it's subjective about how much it adds but like for example if if all the eat steak is going into lighter which already has 30 of the network is that really better than all

the state estate going into rocket pool all all the stake being stake by solo stakers I would argue that it's not it doesn't really add much marginal maybe it adds some marginal security and decentralization to ethereum going with Lido but that eth going and staking as a solar Staker adds much more decentralization to the network maybe security is debatable because obviously you have to debate uh what you you know you have to Define what Security is to you in the in the um context of proof of stake but I'm not going to go into that now but in terms of decentralization [ __ ] yeah SOLO stake is at way more decentralization than going with a big staking provider does so superficion hits the nail on the head there by saying it's not all created equal and I don't have a breakdown of what this 300

000 each went into um but uh but yeah it's kind of hard to know as well uh because sometimes it looks like solar staking but maybe it's not maybe the address hasn't been tagged correctly it's going to be impossible to know the full makeup of the network you know in in terms of uh in terms of solar stake is but I think generally we have a pretty good uh idea of what it looks like right now with centralized providers and stuff like that so yeah just thought it was worth mentioning there but also speaking of ethereum staking uh massio I have said the name wrong again I'm sorry uh put out another tweet through where he said in case anyone is wondering the new rad XA rock 5 board can easily handle a fully subscribed eighth node with hundreds of validators it's a powerful little guy

you can effectively effectively run an infinite number of validators on sub 400 Hardware with plenty of Headroom left over and he shows some grafana dashboards here with statistics around this uh and then names the hardware so the hardware here is the uh the computer here 220 US Dollars which is the rock 5 model B which you can see here uh and then also the SSD which is only 166 dollars but obviously prices will vary depending on where you are this is obviously uh USD prices in the US and software get running get execution Nimbus for consensus and Rocket pool for client management this is awesome I mean anyone who tells you that you can't run a ethereum full node on consumer Hardware it's just brain dead because

you can and then you can run like many many validators off of that which is amazing because you can basically have this small little PC I mean look at it right like you you all know what a Raspberry Pi looks like so if you're not watching the video and listening in you it's the same thing like you can see right here it's just a normal board rock 5 model B it's super tiny uh obviously connecting an SSD to it increases its footprint a bit but still you can probably get an enclosure for it make it all nice and Compact and you can just have that sitting on your desk making no noise you know with subscribe to 100 validators right having 100 validators spun up on a thousand dollar to spun up on it uh and have your own proof-of-stake farm so to speak now

imagine doing that with proof of work you wouldn't be able to do it on your desk you wouldn't even be able to do it in your room you wouldn't even be able to do it in your house to get the equivalent of what you get with doing like a thousand validators you would have to have a massive Warehouse full of ma you know full of lots and lots of these miners they would make so much noise do so much electricity be so much waste so much maintenance and overhead it's just night and day difference right uh and I like the I I remember I showed if it's probably a few ago now when superfizz was doing his um his Showcase of people staking at home there was one where it was basically showing a a proof of stake uh box a knock next to a proof

of work kind of a setup it wasn't obviously in a warehouse it was just a rack a proof of work rack and just showing the difference and it reminded me of like the IBM big mainframes from back in the day and now the smartphone which basically obliterates that right the footprint is just so much smaller so so yeah I mean this is the evolution here this is just another reason why people mistake is so amazing all right just a thread here I wanted to highlight where technical one a very short Thread about the evm storage so if you're interested in learning more about evm storage as I said it's a short thread you can give it a read here from Blaine he goes through slots bits bytes and gas refunds and how his storage is structured and accessed in the evm so it's a thread accompanied by Graphics

that you can see here which uh I mean as I said pretty technical unless you know what you're looking at here or unless you know a little bit about the uh the ethereum tentacles and the evm and stuff like that uh you probably won't understand what's happening here but still it's a it's something I wanted to highlight for you which I'll link in the YouTube description below all right last stop a discussion around eighth and maybe making you a little bit bullish so I said the effects of the merge plus erp1559 play out against USD in Bull markets and against other assets especially BTC in Bear markets last bear Market 2018-2019 the eth BTC ratio crashed 87 from the 2018 Top This Bear Market in 2022 East BTC is only down 20

from the 2021 top and I believe it's down even less than that today uh and then I said this is ultrasound money now I do want to say that the 2018 top was actually lower than the 2017 top on the 8th BTC ratio if you take the 2017 top on each BTC I believe it went down 95 or something like that against BTC so obviously an incredible drop right but now in this current bear Market if he's not doing what people thought it was going to do what a lot of people thought it was going to do and BTC is not doing what a lot of people thought it was going to do typically the line of thinking was that BTC is the flight to safety in a bear Market BTC dominance goes up in a bear market and everything else craters against that well that

might be true for the majority of assets because the majority of Assets in crypto are dog [ __ ] anyway but for eth it is not true at all as I said each BTC is only down 20 which is nothing I mean when you think about percentages uh on on the downside 95 down is a world away from 20 down like it's not even the same realm of things to recover from a 20 down movement you don't have to increase by that much to recover from that I don't have the math handy I'm not going to try and do head math here but to recover from like a 95 drop you need to like I mean okay I can do a 95 drop so just say I'll do it in dollar terms because it's easier to explain just say you have a hundred dollars you lose 95

of it at five dollars to recover from a 95 drop you have to 20x from this you have to go up 2 000 to recover from a 95 drop right similar so went to so to recover from a 20 drop that would be from a hundred dollars to eighty dollars you only need to go out by uh uh well I'm I'm gonna I'm gonna screw up the math here uh if I if I try to do head math I believe it's 25 or something like that something really really small so like it's it's it's a world away from two thousand percent right and and as I said the math is not not exact but it's along the same line of thinking that so when you look at it like that eighth B to C being down 20 is basically noise it's nothing and I don't believe that's

going to last very long I do believe if BTC is going to keep trending up from here obviously um so as I said that's where the effects of the merge in erp1559 are playing out now the fact that we're net deflationary um since 1559 went live and still since the merge went live uh and the fact that the merge reduced issuance by so much and we have that structural cell pressure evaporated whereas Bitcoin still has to deal with the structural cell pressure from miners a lot of miners are capitulating right now it's putting a lot of downward pressure on BTC and I think that is the main reason why hbtc hasn't crashed like it has in the past and it's actually uh I mean it only has to go up a little bit more for it to outperform right in um in 2022 and even into next year so when taking that

all together it's hard not to be bullish on eth because people are going to see this it's gonna it I mean it's gonna like shatter The Narrative of that BTC is the flight to safety so people are going to be like okay well going into Eve isn't actually that risk on compared to BTC it's actually potentially even less risky than going to BTC because if eat out performs BTC in both Bull and Bear markets then what's the point of holding BTC as a as a hedge or as a risk hedge against going further down the risk curve each becomes that in Heath Falls that role so you may as well just hold eth instead of BTC and that's at least the way I look at it it's not investment advice but I think when you think about it like that it makes total sense and you can hold BTC for other

reasons but I'm just talking in the context of holding it as the safest asset in crypto which I I've always believed is is is kind of crap because it save as asset in crypto has always been uh um stable coins right USD stable coins I guess like they're not traditional crypto but yeah this a market has shattered all those narratives there are a lot of people coping over this I think right now they expected BTC dominance to shoot up they expect that each BTC to crash well no that hasn't happened even though eth has gone through gone down to I think it was 0.055 so it went down more than where it is today it's at 0.073 these BTC ratio but that was on the massive sell-off from 3ac uh fallout and selling off to stf and putting downward pressure on Eve but eth recovered from that very very

quickly because people bought it there is a lot of demand there for it BTC set a new low recently eath has not set a new low yet still I mean who knows if it will or will or won't um but yeah I think taking all that into account very hard not to be bullish on eath against BTC let alone USD right but with that I'm going to leave one I'll leave it at that for today so thank everyone for listening and watching be sure to subscribe to the channel if you haven't yet give that video a thumbs up subscribe to newsletter join the Discord Channel and I'll catch you all tomorrow thanks everyone