Ethereum Foundation: Humanity’s Shared World Computer - Hsiao-Wei Wang & Tomasz Stańczak. Ep. 598

Transcript

When you look at Ethereum, it's a bit more like the network effects, connectivity at the base layer for computation which starts to remind like that's a bit like you would say what would be the vision for the internet. That's why we also have to talk about this one one tier vision and say it so clearly protocol mainet is the Ethereum foundation role and it should be scalar one by scale blobs and we improve the interrop and UX just to show that network effect uh on the journey builders that they want to build something they should choose Ethereum because it's is the most secure is most robust should be the default for them want to improve the UX in order to don't even need to be aware of blockchain exist in the app. So I think it takes some time to improve our wallet system

and it takes some time to provide a very good pipeline for the dep layer to improve the UX but I think this world won't be too far away. We increase the L1 block space and still the the fees are low. So why would you do that? Clearly this is a commitment to the future. So everyone can be very confident that L1 will scale. So we can build on L1. We can build more L2s that we are very safe building an L2 that we plan to scale eight times, 16 times, 32 times over the years and NL1 will always be there and will be the best platform to launch L2. So welcome to epicenter the show which talks about the technologies, projects and people driving decentralization and the

blockchain revolution. I'm Fria Anst and today I'm speaking with Thomas Stansuk and um Shawei Wong um who are both um the new co-executive directors at the Ethereum Foundation. Um so Tomas previously founded a company uh named Nethermind that builds um uh infrastructure in the Ethereum space uh including a very wellrespected client and um Shawei um has been a researcher with the Ethereum Foundation um for um uh for ages actually um and uh you both have come in um kind of after a period of unrest from the Ethereum community earlier this year. Um, so kind of I'm super interested to kind of hear your

visions um for um for how the Ethereum Foundation uh will evolve over the next coming years. But before we um dive into that, um let me tell you about our sponsors this week. If you're looking to stake your crypto with confidence, look no further than Chorus 1. More than 150,000 delegators, including institutions like BitGo, Panta Capital, and Ledger, trust Chorus 1 with their assets. They support over 50 blockchains and are leaders in governance on networks like Cosmos, ensuring your stake is responsibly managed. Thanks to their advanced ME research, you can also enjoy the highest staking rewards. You can stake directly from your preferred wallet, set up a white label node, restake your assets on IG layer or symbiotic, or use their SDK

for multi-chain staking in your app. Learn more at chorus.1 and start staking today. This episode is proudly brought to you by Nosis, a collective dedicated to advancing a decentralized future. Nosis leads innovation with circles, Nosis Pay, and Metri, reshaping open banking and money with Hashi and Nosis VPN. They're building a more resilient privacy focused internet. If you're looking for an L1 to launch your project, Nosis Chain offers the same development environment as Ethereum with lower transaction fees. It's supported by over 200,000 validators, making Nosis chain a reliable and credibly neutral foundation for your applications. Nosis

DAO drives Nosis governance where every voice matters. Join the Nosis community in the Nosis DAO forum today. Deploy on the EVM compatible Nosis chain or secure the network with just one GNO and affordable hardware. Start your decentralization journey today at nosis.io. IO Shay and Tomas, thank you so much for coming on. Thank you for having us. Thank you so much for the invitation. Pleasure. The honor is mine. Um, so maybe before we kind of dive into um, Ethereum Foundation um, stuff. Um, tell us about kind of like how you guys got here respectively. So kind of like

what what brought you kind of like to the chair you're sitting on on this present day. Yeah, sure. Uh so for for me it was uh almost eight years journey at 2017 when when Nethermind uh when I started Nethermind before that actually I uh I joined like the Ethereum space of like reading and learning in 2015 16. So I was observing some of the big events of that time. Um and in the first three years at at Namind it was me mostly building with uh with a small group of people at Netamine implementation of Ethereum client. Uh fast forward few years, I went through you know DeFi

summer all the various events after the long crypto winter I collaborated with flashbots and MV solutions research since around 2021 uh like more or less the beginning of flashbots and uh also worked with startnet foundation uh built a twin stick institutional staking worked on the oiler D5 project and um collaborated with for so various uh projects It's always uh more or less related to to our work at Netamines. Uh and for Netamines, I got to uh start conversation with Ethereum Foundation.

Uh I started this year in in March. Uh joined Shellway and uh yeah, now now we're here. Cool. What about you, Shaw? Yeah, I joined as Foundation in 2017. Before that I I mean my background is computer science and then when I joined the the EF I was working on the shing P the shing purpose concept that was very very aged design and yeah so the the time I joined the the research team that was the small team and we started we were working on the consensus protocol mostly and um during

the time like the the EF the research chain um has changed a lot. I mean by years our focus uh keep u expanding to multiple different domains and then yeah I've also changed a lot during the past seven years and then I was a consensus R&D co-lead with Denny Ryan for multiple years and then last year I was I shift my role uh from researcher to leadership at Eastern Foundation And then yeah this year I mean recently one one months ago I honored to be the constitutive director with

Dumash. How did this kind of shape up kind of like were you approached by Vitilik or kind of ya to kind of see whether you'd be up for this or kind of like I mean there was no open application right so kind of like h how how did you guys become co-executive directors? Yeah, I guess for sure way it was maybe a simpler story. She was already in. So uh on my side I I talked to ya for the first time I think uh last last year in September uh in Singapore around token 2049. But then we discussed uh in general the challenges ahead of EF the leadership uh situation after after Danny's departure

and uh we discussed talent management very various topics so it was a longer conversation but we didn't discuss at all like me joining EF and I I didn't think of it I was uh I was obviously super busy with Namite and various other projects um and then as I was observing the situations uh online around the the leadership challenges still I I didn't think of uh me joining EF um but I was just thinking of like who will be there how it will affect the future of uh of various ecosystem players nem how nethermind will position itself in all of this u but I had already at the time like

various discussions running with with IO vital some of them around search some of them around some enterprise solutions and I reach asking some questions and then when I asked if uh if you could have a conversation about the leadership topic again and uh the few meetings, interviews, discussions, meeting with the management team, uh meeting with Shiawe when when we spend a few days together uh to to understand how we could collaborate uh meeting with the rest of the management team, Bastian, Josh, uh Julian. So all of that and then gradually we agreed that so there was lots of discussions about to how to deal with the situation with like net mind conflicts of interest how I will

collaborate with foundation lots of discussions then joining the uh the Eternal Foundation offsite to to get like soft introduction to the entire team and see uh what is the reception whether people feel comfortable with that in the in the context of all the challenges of this joint leadership and and my position and I think then we were uh pretty comfortable with announcing it. So that's the story. And for you, Shawei, it was more it was more of a natural transition, right?

More natural, but it was also not that uh long-term planned. I would I can openly to say it is like but a did have so is now the president of the foundation board. Um yeah she has this idea of like to have some transition more than one year ago. So but during just the internal we have so many things to do. So uh she did able she couldn't make it to be happen earlier. Uh but last year we have several conver conversation around like what EF uh could be like and then this conversation um help us to think more

about like okay in 2025 uh we want to some internal change and what's the how it can impact the ecosystem better and then so such discussion um triggered the earth to form a new uh leadership system in in the foundation. So yeah, I think the the story is like what me described it and then our combination is like there were I mean before this there were some choices uh that uh the leadership has been thinking about but uh after war

I also participate in some discussion but it's not my decision there but afterward I do believe that this combination is the best for everyone and and yeah and also like for the ecosystem. Cool. You guys are coming um coming in at a somewhat difficult moment, right? So kind of I think it's kind of it's well um known that the Ethereum that Ethereum has got an amazing an amazing technical community, right? So I think there's no other network that is as resilient in terms of client development and kind of plurality and kind of network decentralization and and so on.

So kind of like I mean too much you you know this kind of like as a client developer kind of there's no kind of like any kind of piece of code that goes in a client is kind of like is scrutinized by probably 20 very capable uh people and kind of this can this cannot be said for all networks, right? So kind of like this is kind of like this level of scrutiny for kind of like opensource software is um uh is really rare. So um Ethereum really has that going for it. But kind of if you look at um how the general blockchain ecosystem has evolved over the past years, kind of other chains have outpaced Ethereum um in terms of throughput and usage and um

kind of they can do things at a lower cost per transaction. So I think kind of a lot of the unrest that was kind of like in the community was from this perceived lack of vision. I think there were kind of like some um very I mean there there's always kind of like this very loud kind of Ethereum is money kind of crew that I don't I don't think kind of kind of who who are clamoring for more marketing and so on. I don't think that's actually the thing. So kind of I think kind of like but but a clear vision as to um how to um how to shape up Ethereum over the coming years.

Um this is something that was clearly lacking and in in part this is also owed to kind of like how the Ethereum Foundation kind of saw itself right it's kind of sees itself as a steward kind of as an enabler but not as a commander so kind of like other ecosystem foundations don't see themselves that way they kind of say this is the I don't know Solana road map now implemented um so while in a very broad sense kind of Ethereum remains um technically unmatched usage kind of tells was a somewhat mixed more mixed story. So I would kind of like to use this hour to kind of talk with you guys about kind of like how we kind of um reconcile that and kind of like how

you guys are are seeing that in terms of you know future for the Ethereum Foundation and Ethereum as a large kind of Yeah. So maybe let's start off with kind of the role of the Ethereum Foundation. Um so kind of the Ethereum Foundation kind of it sees itself as an enabler not a commander but it is also the main funer for research right so kind of like h how how do you see the Ethereum Foundation's role evolving you say that we are um the main funding source for research and even within the Ethereum ecosystem I think that's much more complex situation uh like positively much more complex there are fantastic research at

the foundation and it's definitely uh there's lots of uh lots of funding delegated to to that uh research that is within the EF and uh through various academic grants and collaborations with other players in the ecosystem. But then you look around and there are fantastic researchers at uh multiple teams all around. So there are researchers at the Elto teams uh fantastic level of ZK research that is interreium ecosystem uh me research that uh leaves all the other ecosystems behind. If you think about the quality of of execution the quality of market uh mechanisms that we have on Ethereum. Uh then you have the researchers on engineering scaling

everywhere in all the different client teams and the funding sources for those are really diverse. So you have uh fantastic VC capital coming to Ethereum and still favoring Ethereum as uh as as the best of the chains and the best of the ecosystems. This is um this also grants from various foundations that are uh independent of the Ethereum foundation. I think that we we see some Dows uh places like Nosis uh that have a lot of lot of support for much of the Ethereum values that are uh like the same aligned within between all those different organizations because we believe in uh India's values of privacy security open source censorship

resistance chain uh to bring it to to users around the world. So now if we think that we uh that we deliver that message of the direction of a strategy of scaling awan scaling blobs or improving ux and interrop uh it's it's still not something that is uh that is imposed on the ecosystem by foundation that we've just invented it internally and said to people this is what we're doing now. As a result of the hundreds of conversation with the ecosystem of listening through the social media channels, through forums, uh through telegram channels, groups, uh conversations at the events, listening to to everyone and understanding those voices uh in depth, why why this

request, why this challenges, why the crisis, if there is crisis, what are the opportunities? And then just uh extracting the essence of all of this and communicating it clearly. So, so becoming this coordinator, communicator, uh the voice that many people are looking uh looking at uh to to listen where we go together. Uh so, so it's still the steward role and an enabler role. Uh but it's still the ecosystem that is uh very decentralized and still uh very aligned unified in the vision and values that's that connect us.

I think the EF's role uh is resilient to the uh conditions in the ecosystem and is dynamic changes over time. Um so like yeah we do have research uh a strong research team we do have some uh focus team uh features team in the the EF like technical team. Um this is like this thing should be be ting on the the most important topic that no one else is working on right now. And I think the EF would never stop like to empower other people to do more uh but just for efficiency

and then for what make the uh best impact in time and the EF would focus on multiple things and also I feel like the EFs uh our I mean I mean Tomas and I in our turn like we will like the EF to be more opinion ated to some basic topics. uh like if is is neutral credible to as a coordinator to help uh steward the ecosystem but like the the things we wanted to value or like the the technical strategic strategies like we want to t um we want to target sooner

that things we're will not getting slowed by uptakes too much in this in the next few is yeah I mean you you both make extremely valid points in that kind of like the Ethereum community is so strong also in part because the there the Ethereum foundation never played this kind of dictator-like role in saying look this is the road map now follow it. Um but I think kind of like h having some sort of north star or vision to kind of um uh focus the efforts from the community.

This is really important because otherwise kind of like it's it's too scattered and it doesn't it doesn't really come together. So I I I totally understand that it's it's a difficult line to tow um kind of h how to um how to focus these smart and independent teams into kind of a coherent vision um but without kind of like letting them run off kind of like completely in in everyone's direction, right? kind of like and so yeah, I I I'm I'm 100% with you on that. And I think it's it's it's very um it's also important to kind of be extremely mindful of the ecosystem we have, right?

So um with kind of like two executive directors in place, um how will you guys kind of divvy it up? Will you just talk every everything out or kind of will you kind of say this is this is your domain and this is my domain or h how um how will this work going forward? Yeah, I think it's very regular but at the same time it's uh it's regular in the sense that we we have conversations all the time but uh without some predetermined time. So I think it's casual conversation, collaboration on multiple topics, very natural splitting of responsibilities because I think both of us are just willing to pick up

whatever is needed to be addressed. Uh so I think it's like we are able to rely on each other. uh there's been conversations and collaboration that was very very fruitful so far uh without any problems and yeah sometimes it's just two three hours conversations on on various topics internal or external strategy on vision uh sometimes I'm a bit godic with talking about the vision internally at the show I just like converse to some super distilled and clear communication uh sometimes we split some some of the policies and procedures Um, Joey has fantastic understanding of the uh of the internal organization of the foundation.

It's uh we're both super aligned to like things related to to budgets to to structure of the organization. Uh I take advantage of the fact that I'm traveling all the time and talking to a lot of people. So big aspect of communicating uh through the meetings reaching out to to community ecosystem partners uh traditional finance institutions this is definitely very often my role but uh I think in Asia shower is much more active uh shower probably have much to add here yeah I think there's too much described that and this mutual uh transparent communication is important I think We were very happy to involve each other to

the different converations uh to with other people's and then uh at the same time like uh we usually would say okay this topic okay we're both involved but uh uh when there's some timing decision needs to be made uh maybe one of us yeah you do it or I do it and the it's usually very simply then we will divide the dut And then yeah the whole process the whole collaboration is like a divide and conquer um like I recently working on some like treasuries management stuff and then Tomas working on some like hiring uh like the hiring team

establishment things like that. So then we have different um domains but it's like also for the yeah for the most important topics we will make decision together. Um I think this divide this division would happen naturally. Yeah, I I uh it sounds like it's it's a very um symbiotic kind of relationship where kind of you you talk a lot of things out and then kind of um uh assign responsibilities um kind of uh ad hoc or kind of like in a more structured way. Fantastic. So, kind of we've talked about kind of like

how you guys kind of work together. Um maybe let's talk about um kind of this notion of narrative leadership. So kind of like there have been kind of a number of v a number of different um ideas of what Ethereum is and what Ethereum should be kind of like ranging from kind of like the world computer to kind of money essentially. um how have you guys aligned on kind of like which of these visions to support and to kind of um uh build towards?

Yeah, I think the Ethereum has this aspect of plurality of visions. So we like when you when you look at the isalics document, it it really draws the vision for Ethereum and the values it really reminds the values of Ethereum. uh and we keep reminding them that's all about privacy, security, open source access, censorship resistance on the chain on the protocol. So they within the plurality of visions I I think that many people proposed over many years like directions which were either uh specific of what they were building or specific of the times of uh various challenges in the Ethereum space right so we were talking about word computer I think this was computer with with AI is

still something that very much uh resonates with uh with what we building uh there were discussions about ultrasound at the global settlement and I think for when we talk about DeFi and O2s and enterprise uh that global settlement layer uh really has the great meaning and and remains very important for for Ethereum. Um and then you had also the visions of really like pure ultra decentralization and uh many people who fight for for privacy decentralization for like maximal uh censorship resistance are are very important for the vision of Ethereum. uh all of that matters and I think some other aspects of it are very often

realized by many L2s and I feel that for particular north stars that are slightly slightly more narrow scope uh this for L2s define their northstars and compete for many of the many of sorry many of the L1s so you can look at many alternative L1s to Ethereum really for us are competing with uh with the leading top L2s that are now scaling, distributing um Ethereum values and u and reusing what uh L1 provides as a as a platform as a uh as a base for them.

Now for for Ethereum, I myself see this like both computer with AI but uh general like open autonomous uh solution for the entire world economy. This is very broad and I think that uh it's really showing like how how grandio how big scale of the Ethereum vision is and but when we when we talk about the vision that uh that broads it's a bit harder to tell people like how do you act within it like they have to find their own path and maybe for very customizable special L2s this is a bit easier so they can they can go there see okay this is the aspect of that world economy world autonomous computer that I want to build. Uh when you look at

Ethereum, it's a bit more like uh the network effects connectivity at the base layer for computation for for access to to data and computation and coordination and the ledger everything together which which starts to remind that's a bit like you would say what would be the vision for the internet. Yes, it was connecting people but it uh but then you would say oh is it just about connecting people or connecting systems or connecting machines or is it about the network is about the financial system and I think with Ethereum uh it's also very much visible it's it's a coordination it's finance and um and then particular challenges appear but that's why we also have to talk about this one one tier vision and say so clearly uh now we

think about protocol protocol mainet is the ethereum foundation role and it beca on Y scale blobs and we improve the interop and UX just to show that network effect uh on the journey. So but kind of like if if I kind of distill this into into kind of like one kind of punchy um uh by line kind of it it it would be um kind of utility over um number go up. Is is that fair? It's the impact and winning for sure. I mean like uh when we talk about the values uh we know that the values would uh would not have that impact without really

winning and showing that you can get adoption, you can onboard users, you can connect systems, you can get network effects. um is a utility in a sense as like benefits for for the users globally impacting everyone's lives in a positive way and in a way that they themselves define for themselves what positive means right like so not not someone defining uh top down of of what really is good or bad for other people. So, so when you start talking too much about utility then maybe you lose that neutrality of the protocol and by just essentially we have to think about Ethereum as being everywhere and

connecting everything connecting everything so it can be neutral because if you if you exclude some aspects of the economy some aspects of automation some aspects of that word computer then you're no longer neutral because like what how did you end up with that decision of what is excluded like why did you why didn't you connect everything um and and yeah in this in this sense that utility arise with everyone who builds on top of Ethereum and uh scaling Ethereum makes sure that that utility uh can be immediately accessible available and that people want to build more on Ethereum. Yeah, I I hear that. Um kind of you're already alluding to kind of the um different L2s that kind of live on on top of Ethereum.

Maybe maybe let's talk about this for a while because I think this is one of the it's one of the really difficult problems for Ethereum right now. So kind of there's this number of ecosystems that kind of live on top of Ethereum that are often usually um pretty insular that are not well connected to each other or or to Ethereum in fact. And in some sense they could even be kind of described as somewhat parasitic because kind of like they they kind of um take um transaction volume away from Ethereum and often they don't actually kind of um they kind of

proclaim the Ethereum values but often they don't really see them through. Right? So kind of if you if you if you're in a situation where essentially you have a centralized sequencer, you have exactly one party building blocks, right? This is very this is very much against the spirit of kind of like openness and and and resilience and permissionlessness and and so on. So h how do you navigate that? I I think that's when you when you say there are situations when you have the uh roll-ups claiming to be to be rollups and then the question is who agrees that this is a roll up like anyone can claim

it right. So well on one one side you want to have that permissionless aspect if anyone can launch a rollup. On the other hand you have to provide some guidance of of what it means and uh which rollups are safe because you care about the security aspect of of Ethereum. Um and the branding of security is important because the user experience means that you feel comfortable in the ecosystem and you feel that there are some guarantees of security and guarantees that you understand it without understanding all the technical details and without verifying every line of code of every system. Uh sure it's the verification maybe is aspect of of blockchains in general and the blockchain values. Uh but you also want to have on boarding

your users and make it a good UX. So, so you have L2P does the review of the of the stages of roll-ups, right? So, the the stage zero, stage one, stage two that define different like progression of of the security of user that moves assets to those rollups and even if you have centralized uh sequencer on on L2, then the questions are if that sequencer fails, if there is a liveness failure, will the users be able to withdraw assets back to 01 like uh are their assets safe? So that's why we very often will encourage to uh to to mint all the assets on L1 and then bridge them to L2.

Exactly. But that's not how it happens today. Right. So kind of like if you look at say for instance the base ecosystem almost all the assets that kind of like are traded on base are actually minted on base and kind of like this idea of kind of like withdrawing to L1. This only this only works if kind of like all assets are natively minted on L1, right? you can't you can't withdraw a native L2 asset back to L1. Yeah. So I think there'll be much more guidance on on those aspects. So for for many high value assets when when you see the real world assets the the stable coins and so on there there are multiple approaches like so you can have situation when you really rely on is insurer and say that there are the guarantees of the uh of

like of your security of assets. what will happen if if there are some failure at the same time I'm absolutely convinced that any uh any large institution that is issuing on blockchain want to avoid any failures even if they can later have some kind of social consensus or the corporate or legal uh legal way of resolving the situation. they will not want to to ever observe it with their customers like their customers will be really disappointed if there's any failure that you cannot resolve entirely on chain with this like transparent on chinway.

So that's why we see a lot of those assets being actually mint into tunnel one and this is like the the high value funds that that go for Ethereum and then they bridge to L2s with a with a lot of restrictions and verification uh for many of the of the tokens meme coins coins um that's like like fun exploration there you have situations when the minting obviously happen on on L2 uh but even then like when you when you have larger L2 protocols with uh with larger liquidity I think that the the situation in the future will be very clear that uh you may have this uh risk seeking capital that will uh keep reaching to L2s but will be coming back

to to L1 for the time of safety uh and for every single like operator like the the the capital provider they'll have some percentage of assets being in that safe zone settlement zone of L1 which means that when you look at globally at the at the entirety of the economy L1 will be the space of the settlements of the largest like liquidity uh source that you'll be borrowing to to more risky escapades in L2s. Uh also L2s very often don't have this like a global or neutral vision. Uh so they they take some some shortcuts right like so you suggested this one like centralization shortcut like might be uh might be alignment with some particular jurisdictions right some some altus might feel more American some of them

may feel more Chinese some of them may feel more European uh some of them may be targeting particular uh particular set of solutions maybe some of them will be customized for gaming maybe some of them will be targeting some uh demographic in the way how they how they market their solution while Ethereum for all of them provides that layer of uh of settlement security and providing a global brand. So once again when we look at the L2s we will be opinionated in a way we'll start talking more about what we expect on the sense of security what we expect on branding when you can claim uh it's Ethereum roll up uh what we expect of like contribution to the network effects uh collaboration on interoperability on

tooling uh innovation back to to the Ethereum ecosystem uh the way we communicate all about interoperability between the L2s and L1's but also how um how open those L2s are to collaborate with other L2s like so so this a very very interperable friendly ecosystem uh that has some very healthy competition on innovation on on user acquisition all together will be on boarding to the ecosystem uh users and capital so I think definitely success of all twos brings developers users and capital to all one and uh increases significantly the demand for the block space on L1. At the same time, we also have to run a bit

ahead uh deliver that block space that is seemingly like because now you have questions of we increase the L1 block space and still the the fees are low. So why would you do that? Clearly this is a commitment to the to the future. So everyone can be very confident that L1 will scale. So we can build on L1. We can build more L2s that we uh that we are very safe building an L2 that we plan to scale eight times, 16 times, 30 times over the years and NL1 will always be there and will be the best platform to launch L2. So there's a lot to unpack there. So kind of like I I kind of I want to talk about

kind of like um the interplay of different L2s in just a bit, but kind of be before we kind of dive into that, let's talk about kind of this idea of Ethereum as kind of a global settlement layer. Kind of like how which is kind of like what you're alluding to, right? So kind of like if you look at Ethereum today, um Ethereum processes around a million and a half transactions per day at the moment, right? Um so if you look at um financial transactions between um between uh for instance um banks and large players and so on which by kind of like your argument should definitely settle on L1 um transactions between different L2s

um emission of um of uh stocks and so on. So I think there's there's on the order of 50,000 listed stocks worldwide. So kind of like if you want to do a a settlement at least once per stock per day um kind of on L1, if you want to kind of register all new stocks on L1, then kind of there's there's other um things like um for instance ENS domains kind of uh that kind of like I mean there's going to be namechain and so on, but in principle kind of like you should be able to kind of um kind of have them on L1 if you wanted to. So kind of like um so I I'm just kind of like I'm not making my myself very clear here, but

kind of like if you look at kind of like the global volume of things that kind of like should be settled on L1, a million and a half transactions per day probably won't cut it. So let's talk about kind of like how to how to scale that up and what the plans are for scaling L1 uh block space. Yeah, sure. So we have planned for 3x of the one block space uh this year. Uh so you could target something around 100 million uh gas per block this year. So this is mostly done for a coordination between the execution clients verification of like uh where the some additional optimizations are needed because many of the clients show

clearly that uh they're ready to go there. uh we see L2s actually using the same technology for for scaling uh their layer and now the question is are there some some additional bottlenecks around the uh consensus coordination the networking decentralization of L1 that actually show you differences between how L1 operates and L2 operates. Uh so so far we feel very confident about that growth this year. uh then we ask questions about how we go to the next 3X next year and that um you see like Dangrat proposed those numbers and but they are uh they're not uh just out of blue they are designed based on the conversations with all the clients and

understanding well what is in the pipeline on the EIPs. So some of the IPs that will help us uh that will ship in Glamsterdam uh will help the clients to support this further 3x scaling. So you have already like uh three 300 360 million gas per blog uh next year uh and continuation continuation of that and you you mentioned that one 1.5 million transactions uh per day uh so this is very often there's like a bit more complex transactions because when you when you look at the payments like the most basic payments this will be like 10 or 20 million uh transactions and the current throughput and as soon we have 60 million I expect that maybe like u in uh in May you'll have 60 million gas as a block size the the max block size the

coming back to once again to this 1.5 million transactions and all the equity and what you have to have there so we want to support all the most valuable identity most uh valuable identity for for people for agents for uh real world assets like so you have real estate you have the obviously like like equities trading uh the high value like dep equities FX trading where you have maybe transactions of hundreds of thousands of dollars or millions of dollars. So I clearly remember my work at the um at like technology for the FX task at uh at City Bank and we would look at the time when the non-farm payroll was announced and you would have this like

hundreds of thousands of transactions and they you know the minimum notional there would be 1 million nobody would trade anything below 1 million uh because this was the ticket size that you would just like use. So whenever you would say one, you meant 1 million and uh and those transactions were flying in um within milliseconds and you want that uh to to have always the easy path to L1 and those transactions nowadays uh I think they cost uh like this data good to to verify it but I think like it's between5 and $25 per million of notional that you have depending on the markets.

can be less, it can be more. Uh but those are the costs in the traditional finance. And nowadays when you look at the price of transactions on uh on Ethereum on a layer 2, this is like between 1 cent and $1. But it also means that um easily those transactions in the future they can uh first of all because of all the volumes when they move to 2011 they can uh they can fill like any scaling for 10, 100 or 1,000x for the next years. uh and they will always choose a one first for security and then for scaling and for the cost reduction they'll move all the remaining transactions to L2 for scaling but they'll be settling and and keeping the most safe liquidity on on L1 and now the question is how much of this liquidity

can move to the global economy how secure how safe they feel the more L1 scales the more also L2s can uh take off the all this transactions that are secondary market of uh uh of the daily trading right so So all of these movements will will take advantage of a one and a1 will be able to really price um those highest uh highest value transaction uh significancy because they'll be always willing to pay for uh for the security and safety on the on the one. uh it's just for now we are in the in the scaling time in the crow time in the user on boarding time uh showing support for L2s and the scale is nowhere there to uh to support the entire global

economy but when we go to this like 100x 1000x multiplied by all the L2s successful on tools on Ethereum then you can start talking about this quadrillion dollars of global economy and assets to be very safely uh transferable to to blockchain and that's why we work on security as That's a really interesting kind of vision for Ethereum kind of as this almost kind of like how we kind of talked about rollups back in the day, right? Kind of like before they kind of became their own standalone ecosystems kind of like we thought of them kind of as these liinal spaces where kind of like transactions would be processed and rolled up and then kind of ultimately

kind of everything would come back to Ethereum. Um so if if that's kind of the vision kind of will kind of the three three time scaling and then three time scaling again will those kind of suffice right kind of like there's 8 billion people in the world so even if you kind of um expect everyone to at least kind of like have an identity somewhere I mean you should probably say tell people like for your most valuable things like do them on L1 so at least everyone kind of should have an L1 account, right? So that's 8 billion L1 accounts right there. So kind of like and kind of this is why kind of like way back in the day

and maybe shall we kind of maybe this is kind of like a question directed at you. So kind of where where this kind of um idea of sharding initially came in, right? kind of like and kind of when we talked about charts back in the day, we kind of we thought about kind of like um we thought we we thought about asynchronously linked charts with their own execution environments and so on. So just so kind of a,24 shot shards of kind of like kind of and and scaling Ethereum by a factor of a thousand. Obviously that would help a lot more than kind of scaling by a factor of three and then scaling by a factor of three again. And so kind of like and and I mean obviously this also generalizes. So kind of like you could um Yeah. So any ideas to kind

of bring that um old concept of sharding with kind of like standalone execution environments back short-term plan we don't is no more u stay alone exclusion uh engine to be added for now but uh I think you can see the the recent uh the zk or like risk 5 discussion like we don't we never stop to think about what is the better exclusion engine and then this is will be a long-term plan to for the researchers and the developer to investigate it more uh before we have them enough confident to switch the

illusion engine this time. Okay. But it's it's a kind of like it's something that kind of the Ethereum foundation kind of thinks about. Yeah, we have many people is working on this topic and there's also many external uh you know uh RX 5 ZVN teams are actually prototyping this and the pro product this and but I this is I would say this is part of our focus in the next five year plan. Maybe not what we will deliver in years but yeah it is in our uh research road map. Fantastic.

Cool. That's that's super good to hear. Then maybe let's move on to kind of like the current L2 landscape. So kind of like too much. You already talked about how L2s and kind of like what calls itself an L2 is very divergent. So kind of I I also love L2 beat. Um but I also think it's somewhat sad that we actually need it. Right. So kind of um if you if you look at some I mean I I mean clearly kind of like what level of security you want and need heavily depends on your use case, right? So kind of like as you said kind of like if you're settling um if you're settling debt with kind of like and a minimum order size of a million then kind of like paying5 or $10

in gas fees is is not an issue at all. So kind of and you should be willing to do that, right? If you're trading in-game assets, that same level of security is probably not need. I mean, I'm not a gamer, so I I I won't judge here, but kind of like um yeah. So um and kind of being very transparent about kind of like what level of security URL 2 offers probably not so much to users, but kind of to developers who kind of develop on these platforms. um is really important and I feel like there's a a very wide spectrum of solutions. And so kind of like there's kind of like uh uh sovereign rollups um kind of on one hand and then there's

kind of like um uh Tao on the other end which kind of like more or less settles everything to Ethereum and then kind of like there's things in between with kind of um centralized sequences and kind of like then the federation of sequences and kind of like that that there's a question of kind of like whether you can actually escape to L1. one whether you can actually have fault proofs and so and and so on an escalation mechanism and so on. So I mean so how how um and if you look at how um the ecosystem currently chooses an L2 kind of as an engineer really frustrates me that kind of apparently DAP

developers don't pay this a lot of attention. there's very um high value ecosystems on some L2s that are actually extremely centralized. Um so so h how do you explain that and how do you h how do you do you think there's there's the need of kind of um vocalizing about this more yeah I mean you started by saying that it's it's beyond we need L2B but it feels very natural I mean someone takes decision even at the beginning whether they choose Ethereum or other one ecosystem and they they look somewhere for that information like uh it's it's there it's available through through

blog post through uh through Twitter or other social media they can they can start hearing from friends like yeah this this is where it's very valuable that's where the values are this is where it's safe where it's safe but they and this is a big plague of the of the blockchain ecosystems like the entire industry that's it's really hard to get that information so every venue like LTB helps a lot and if you make the system permissionless uh then anyone can launch anything without any reputation and now you seek the information at the beginning of building over time the uh the resilience and and trust in the thing and the trustless thing right trust in the trustless thing that you build over time uh so maybe you still have some

longrange attacks but you say okay this this code base was verified many times even when we talk about like bitcoin or ethereum we say look those system exist the systems existed for many years so are verified and we feel safer but if the user comes for the first time to to the industry they need something that will show the maybe the list of the ecosystem say how many years they are in uh what's the what's the perception of of their safety what their values are and it's the same for L2 so it's the same for the D5 applications like if someone deploys a D5 application on AMM on Ethereum you would like to compare them like what is the liquidity there uh how they're designed do they have immutability or proxies uh do they have um do they have like support from the

major the major auditors verifying and confirming that the codebase is correct. So I think on every single layer of blockchain we're looking for this and until we have some like really advanced high high quality AI models that can give us uh uh give us that assessment independently of any external provider. So we can launch on your own device a device AI that will tell you this is safe to use this is the blockchain to use this is D5 to this is L2 to use. uh it's really hard to do it the other way. The users developers will choose some ecosystems when they feel uh they have the best parameters. So like the maybe the best user best users for their particular applications the best liquidity. What is very important for us

is they they always feel that they they will always check like how uh how much of that connection of like how much of that security and censorship resistance aspect from the L1 they they have in the ecosystem and they either can verify it by analyzing the the contracts governing the the L2 or the design architecture of the L2 or they can check it via L2B or other sources that are comparable and this is aspect of branding of Ethereum like if you claim that you're auma At some point we have to maybe start saying that no this is not a rollup uh or no they they are insecure uh no they don't uh don't interrupt with everything else and if the interoperability improves and this is a

big challenge for us for sure like this is uh this will be a a huge effort of the entire ecosystem to bring that good feel of uh the same tooling uh network effects interoperability so so that cho those choices maybe are much clearer uh it means that it doesn't mean that you'll be always choosing the same L2 but it will be very clear based on your your type of application that you're deploying where you go and it will be very clear that you always want that connection with uh with L1 so so I think that I I was exploring recently a lot of conversations with enterprises like institutions traditional finance and very often they push exactly for the for the values that

we're talking about they asking about the privacy for the customers They asking about uh the censorship resistance like fair access to the market and no censoring of the financial transactions. Uh they asking for asking for variability and an open source aspect of it. And while they asking for the customizations through the like they want to have control over some aspects of their internal business processes uh internal matching uh their their customers interactions through their own L2s. they do ask about L1 that they can allow their customers to venture to to have this global neutral market. Uh you don't go now to the institutions that ask for their own L1. Uh rarely rarely I hear that they see that there's a huge

value in participating in the global economy for Ethereum L1. they have some needs for the L2 for scaling but they always want to provide a lot of like the transactional processes supported by privacy on L1. So when they support all of this then we also have even more funding for privacy for users for retail users. So I see a lot of and and you ask about tao like the the spectrum right so uh so taiko being based rollup and Justin's uh direction towards a native rollup and base rollup extremely important there's lots of optimism from from Justin from others that look some of the progress on the CKVMs uh what you see on the if proves website you can go there and you can see how all the VMs

compete for the performance of proving all of that shows like a lot of promise that you can accelerate this timeline I show this is 5 years and this is very reasonable but we push constantly that there's technology changing there is AI it accelerates our research and it means that we see much more of a progress on ZK than we expected already so maybe this is the same for the future so maybe in two years we'll have like super operational based native rollups with ZKVM which is very close to what you were talking about when you mentioned sharding of the past uh with the composibility of multiple L2s within this uh native rollup containers.

I I want to believe all of this kind of because kind of like technically it makes sense, right? But kind of we've seen time and time again that the technically best system doesn't always win, right? Kind of like there's other kind of um considerations that kind of play into that. And I think the the one that people always talk about is bettermarks versus VHS and that's that was 40 years ago but I mean we have more recent ones too kind of as to kind of like uh um 4G standards and so on. So kind of YAX was superior to LTE and LTE still won out. So kind of it's it's kind of like there's um this happens all the time that kind of like there's some sort

of um um there there's a a solution that is understood to be the better solution but the other um the the the alternative still wins out right so kind of like if you are in this position where US presidents kind of launch their shitcoins on kind of alternative protocols does Does it confer enough gravitas and kind of um seriousness to kind of take away from that technically valid claim from Ethereum that kind of it's the best solution kind of like h how yeah so yeah I think this is exactly

where Ethereum wins I mean so Ethereum very often will be uh maybe people ask about it's yeah it's as the most secure solution but it's maybe rougher around the ages on like uh taking advantage of all the latest developments in the uh in like accelerating the blockchain design because there are there'll be always some some uh fresh and burden unbburdened systems that will say oh we we do the more transactions per second. So, so and then you would say does it mean that this like best current technology wins or we are very confident that this is what what we all bring to Ethereum with the uh respect for all the values because this is how we attract the the customers the users capital and so on. So uh almost you can say this is

exactly why JM is winning because it has the technology that is really caring about the delivery of everything that matters and uh at the speed that we accelerate we definitely uh this is this our task to improve that efficiency of delivery of the all the improvements that if if there is a lag between the innovation and adoption to Ethereum of some solutions that's not a two years lag it's not a one year lag but it's maybe like a few months before we see oh this is to the functioning and it can go in the next four correct two forks from now. Uh but we know that the developer ecosystem the tooling the adoption from uh from the from the financial industry uh the adoption of users. So, so look at

recent recent announcements from uh the acceleration of worldcoin users on boarding uh base on boarding a lot of users uh stark net recently showing that game that focus tree that got like 200,000 users and it's growing in the app store massive success. So all of this does shows us like this technology is winning like we see the numbers and it's winning and see and we have L2s that actually uh strengthen that and show us that uh on top of it we have capacity to compete with any alternative L1 through those O2s they can adopt even faster any scaling capacity solutions they can go to the massively scaled blocks novel P2P

systems and we bring it also to So Mhm. I would say that the trapness of technology but not in the sense of like security or caring about the values and delivering that promise. This is not draft. This is what we always care about. Uh but this sometimes delay uh the the innovation because you need a bit of verification. Is it uh is that maps verified? Is that uh are those ZK solutions really really fine? Will they will they cause like the the massive bug in the uh that you will have to keep patching and then you will not even be able to confirm that like everything was fine. Right? We've seen that with Zik technology in the past. Uh we have hundreds of researchers and and testers and engineers verifying all the claims about all the IPs that go into the

system. If you're kind of championing the L2s in kind of this competition with alternative L1's, how do you see kind of the problem of cross L2 interoperability? So kind of like if currently kind of like I um I want to exit from optimism and go to arbitrum, it'll take me a week, right? Kind of I could probably send a postcard faster. So it it's kind of um and kind of the varying message standards and I mean so should there should kind of Ethereum kind of institute a um a message passing standard or kind of like a kind of

because kind of um one of the um core propositions of kind of having L2s is that having L2s on the same L1 um is that in principle you can kind of have this cross L2 communication without necessarily kind of going via the L1, right? But we don't see that yet. So kind of we see kind of a number of siloed ecosystems on top of L2 on top of L1 that kind of don't don't act like a unified ecosystem. So is is there a way to kind of um make this happen and if so make this happen faster?

Yeah, sure. I mean so there is u there is open intense initiative uh coordinated by Josh Rudolph. Uh we see the the fantastic bridging solutions appearing in Ethereum XSM all the time. the fact that we need all that many bridging solutions and that we still don't have one that says like yeah this is like globally acceptable and best experience uh this remains a challenge and this is what will be the major coordination and research effort from the foundation I agree with you that uh this experience is not not best yet um I think that probably the existing bridging solutions you wouldn't wait a week it's just that you would sacrifice some of the security assumptions. You

would have some some third parties uh providing the temporary custody or or some kind of insurance level. Uh so so user experience definitely it's not on the weak level but the user experience with the guarantees of Ethereum would be there and uh and this will be massive effort and I think there's lots of challenges there. Uh but it also means that look the challenges will wait for for any other ecosystem because um we expect the growth of the demand to always uh be beyond of anything that the L1 can deliver. uh combined with the customization requirements and and some kind of control over the chain that for

example enterprise when they like the the financial institutions when they when they come and they say we need something where we have more control and we need the global system where we actually have no control because it's neutral and it's it's censorship resistant. So this together means that any other ecosystem that will compete with Ethereum will face those challenges sooner or later. uh and and we are spending a lot of effort on this but it also means that in in many ways we are already ahead of others who will face that as well. uh and I think this is challenge for other alternative ones like they they look at Ethereum and they think all right consistency they the customers that we are approaching

potential customers that we approaching or or the or any institution that we want to invite they they say to us no like we use Ethereum because there on Ethereum we feel less like a customer it's just ours like we just take it so uh and and we can shape it the way we want and we can participate in global economy So it's really hard to compete with that when you like want to treat someone as customer but they say no we just want to use the network and get all those network effects and then they get support from L2s that actually come and treat them as customers and they say you have everything this together. Um so massive challenge from us from L2s inviting L2s to help us with those

interup standards. uh there are multiple proposals we see we see the opin proposal we see various like bridges that uh they come like list many I wouldn't like to start listing because then I'll omit too many uh the open intense initiative um the various solutions in the maybe like me order flow space uh as you see like the the rollup related solutions and so on and so on so the all of this has to feel unified and it comes also with uh with tool link wallets, the user experience, maybe maybe LLMs will come with help, um the the account abstraction that is coming to to Jun came with impactra and the first first solutions and they'll

continue all of that together a lot of work and that's why we talk scaling one and scaling blobs but also interrupt and UX uh maybe possibly the biggest challenge of all of them. Cool. So kind of if you look ahead, I mean you you guys just started. So kind of like if you look ahead one year and maybe five years, what does success look like for you guys? So for me, look, my term is two years with the foundation, which means that for me success means that I really show that like within two years, we can achieve a lot of a lot of things that people are saying that are to be solved now. uh that if we if we mention those

things like scaling go on scaling uh blobs and improving drop UX that this within this two years it should be a massive change and and a feeling that yeah this this really happened uh and it means that even if we set the goals then the success for me means go much beyond those goals right that it's it's really absolute win a huge impact uh a really great vibes between L L2s and L1's and everyone in ecosystem. Um the the funds that will that will deploy trillion dollar level funds on on Ethereum. Uh the L1 that everyone is excited about that is just like uh it has such a huge

capacity and such a high value set of transactions that it generates massive fees. Uh so all of that together is a is a success and uh and beyond that there's another story for me. this as like two years workers turn around everything that needed attention. Uh make sure that communication on all of this feels uh feels great. Uh and then and then be really happy like to to see others to continue. Uh yeah. What about you Shaw?

I think it's for shortterm I want this to be the default choice for all the use cases. uh in including that L2 choose what L1 is uh and then it's from application layer it's from the institution layer and then it's from the all the builders that they want to build something they should choose Ethereum because this is the most secure is the most um robust this is the best trend they can they should build on when they choose uh blockchain technology technology this is should be the default for them and I also want to improve the UX in order to for the users that they

don't even need to uh be aware of blockchain exist in the app so I think it takes some time to improve our wallet system and it takes some time to uh provide a very good pipeline for the dep layer to improve the UX So, but I think this world won't be too far away. So, if kind of like each of you kind of had to give um one number one priority for your for your term uh in kind of like just one because kind of like we talked about a lot of things kind of we talked about um scaling uh block space and blob space and a2 into

operability and user experience and so on. So if it's just one priority, what what will you kind of optimize for for people to come and see like thousands or millions of applications on Ethereum ecosystem all feeling like one and uh no what about you Shay? I would say to bring Ethereum alive again. Good parting words. Thank you both for coming on. We will share kind of like uh other places you can follow you guys personally and the Ethereum Foundation um on Twitter and elsewhere.

Um and uh thank you so much for stepping up. Thank you Vick. Thank you so having us. Thank you so much. Thank you Federica. Yeah, it was massive pleasure.