Ethlabs and the plan to make Ethereum the root of global finance

Transcript

The more Ethereum is valuable for these chains, the more these chains will be valuable for Ethereum because then Ethereum can capture some of that value, right? So like it is our prompt of like how can Ethereum be maximally valuable for a Robin chain for a you know like whatever they chain that's what we come back to interop like what offerings like what what do we need to do that being on top of Ethereum is something where it's like how could you possibly do anything else right like it's it needs to be a no-brainer if if a new financial institution comes on chain of course they're going to do it on top of Ethereum. ETH Labs was the first of three new organizations in the Ethereum ecosystem that launched last month. But what is ETHLabs? What do they do? And what does all of this mean for ETH the

asset and for investors? Hello and welcome to the Milkro Show, the podcast that knows that ETH Labs are much different than the kind that they had on Breaking Bad. I'm your host, John Gillan. Today is Tuesday, July 21st, and we will be releasing this episode on the 23rd. Today we are joined by three of the five co-founders of ETH Labs, a nonprofit R&D lab for Ethereum and for ETH. Anscar Dietrix who is the executive director. Barnaby Monat who is the head of platform. Julian Ma who serves as the head of growth. I probably butchered all of their names, but they're going to be very gracious about it. This episode is going to be an absolute banger. If you're excited for some Ethereum alpha, make sure you like and subscribe. Share this episode with somebody who's going to enjoy it. Today's episode is brought to you by Securitize, the regulated

rails for tokenization and BitGet stocks 2.0 with real liquidity, real dividends. Without further ado, welcome to the Milk Road Show, ETH Labs. How are you, gentlemen? >> Hey, Joel. Super excited to be here. Thanks for having us. >> I can't wait for this. This is going to be amazing. I don't think I've had this many guests on one episode of Milk Road ever. Um, but I think this is a good way to to start. Um, and I thought a place to start this conversation, uh, there was a recent interview that I saw Julian did on the mission statement of ETH Labs, and I wanted to get you guys to comment on this. She said that the the goal is to make Ethereum and ETH the root of the global economy, which is, you know, not a very ambitious goal, but I thought it was a good way to frame

this. Uh, Anscar, let's start with you. What does that mean? How does ETH Labs go about doing that? Yeah. So, I actually think it was really fun like as as I heard you just now read your opening sponsors and and you know I think it it shows kind of that Ethereum is evolving, right? I think four or five years ago we would have had very different sponsors and I I think I think it shows like like Ethereum obviously like has done phenomenally well in the past, right? Like I think I think we've there's been a lot of success um a lot of success in the during the stage where where crypto was really about figuring out the basics figuring out the infrastructure like figuring out even just like the things like smart contracts you know like the the basic things and I think for the last two

three years more and more I think it's kind of like becoming clear that okay the basics are in place and now it's about actually like bringing this to the real world like like actually like having having blockchains be practically useful practically used and so what are they for and and and how can it how can it or should it play out? And to us basically that like the the root of the global economy is is the answer. We really think Ethereum needs a clear answer, a clear vision that it works towards. Um and and I think that it really is in a way like it's very simple. It just has it's a few insights like one just the very simple one like Ethereum is primarily first and foremost for finance financial applications. That is where the clear product market fit is for for Ethereum where it's the most

useful for. Um and then basically in terms of like how what different worlds could could we end up in um I think I I really think that like when we say the root of the global economy I think there's like a very unusual moment in time right now where there's there's this like special price up for grabs basically which is the one chain to tie them all together basically is how I would say it and I don't think it's at all guaranteed that it'll play out this way. I think what we could see is that we could just see like the entire world all the financial um applications institutions they all come on chain and they all come on chain in their own little pockets you know you have like some maybe inter company chain here some inter company chain there like some geographic chain here there whatever but

it's all kind of like disperate all over the place and you just have these duct tape you know links in between each other they occasionally fail it's whatever and we still get into a better world than we have today but it's like quite brittle and not that better and then I think there's the alternative the alternative world where you actually you have the same modularity, the same configurability like everyone can do their own thing if they want to but it's all on top of like or I don't know mixing metaphors but like around one central hub where basically like all the activity flows through that one chain everyone settles back to that one chain and in that world it is it is incredibly more powerful because like by their natures blockchains are state machines like it's basically like in that world everyone moves in lock step and so that

means that like no matter where you are like point A in the space and point B in the space you always have a trustless instant link between the two you can basically have infinite like atomic clear fast interoperability between all parts of the global econ global economic system. Um and I think that would be a just so much better for the world and I don't think so many like I really I I honestly believe I'm talking my book here but like I honestly believe that only Ethereum has a shot at achieving this. I think we either end up in a world without such a chain or it's Ethereum and I think it is like because really you need a single chain with incredible neutrality that the entire world basically buys in and that's just super rare and so given that we think this is like that's the incredible

vision that we need to get to like that that's basically our goal. Ethlaps is the place that will help Ethereum make that outcome happen. >> Hi everyone, this is John. Listen, our Milkroad Pro analysts nailed this AI bull market. They we had dozens of calls pay off in a big way for our community. If you want to see how our entire team of analysts are positioning for the crypto bull market that's going to come after this bare market finally ends, you can join us now at Milk Road Pro. It's just a dollar. Link is in the description. You'll get access to all of our analyst trades, their watch list, and see how they're navigating this in their portfolios and get access to ask us questions in Discord anytime, day or night. It's just a dollar. Link is in the description. Milk Road Pro. Join now. I'll see you there. Okay. I assume

you all believe this. Otherwise, you wouldn't still be fighting up up this uphill battle here. Um, so, okay. Ethereum Labs or ETH labs has been launched. The Ethereum Foundation already exists. There are other entities as well. Ethereum institutional uh and ETH systems that have just been launched. Situate for me this ETH labs in in relationship to these other entities and how you are all collaborating on this objective of of making ETH the the root of the global financial system. Whoever wants to run with this, feel free. Julian, I see you unmuted here. >> Let me take that one. Yeah. I mean, first of all, I think it's it's shows the power of Ethereum that there it is possible to launch so many of these new credible neutral nodes within the Ethereum ecosystem to help Ethereum

grow. Uh, and it also speaks towards the vision that Vitalik and the Ethereum foundation had for how Ethereum should be governed moving forward. Um, Vitalik others wanted this multi-node future where the Ethereum foundation wasn't the only place here helping Ethereum grow as like the only steward. Obviously there are many people in the ecosystem before us as well. Uh and we took that to hearts. Others took that to heart as well. And that's why we launched E labs. Um I think we're all sprinting towards the same goal here. Like the f us, Ethereum institutional and e systems. We want Ethereum to be the root of the global autonomy. How we do so is different. Uh the F is here to protect the values of Ethereum and we also create a lot of the technical features

that still make Ethereum so special like ZKVM like postquantum uh very important features. Uh we're also on the technical side and we're looking to create features that are perhaps more useful for the short term and for the financial use cases that we're very excited about. That's why we're looking at interal but shorter slots. Barnab can can tell us more about that uh perhaps later on. And then institutional is more on um the enterprise outreach, the institutional outreach um and making sure that the product that is built like the product of Ethereum is adopted by the people who would most benefit from it. And so they speak with the institutions and ensure that if Ethereum is a good fit for them, their assets are launched on uh Ethereum. E Systems is another group. Um

I think they're actually slightly different because they are a for-profit entity. um which means that they are trying to um bring on institutions on privacy preserving tools on Ethereum uh that help these institutions launch their assets for example as well or some of their operations. I see them as like forward deployed Ethereums or forward deployed engineers. Um I mentioned the forprofits because not because it's bad but I think a very interesting part is that uh ELABS as well as Ethereum institutional have been able to raise as nonprofits and this is very different from what you see in other ecosystems right and I think that truly speaks to the power of Ethereum like our backers believe in the mission our backers believe in the mission that the Ethereum institutional has and that's why they're

willing to put their money behind a credibly neutral organization. >> Okay so we've established the goal we've talked about some of these entities that are all working together to move towards this goal. I want to hear a little bit more about the collaboration. Um, Ethlabs is new. You guys are growing. You're hiring. One of your first hires was another Ethereum Foundation former researcher, uh, who, as I understand it, has been hired to focus on Ethereum improvement proposals for ETHLabs. And I'm curious how that works now. Does ETHLabs now own the Ethereum improvement proposal process? Is this divided between these entities? Are you going to be fighting with each other over this?

What does that collaboration look like? and uh and what does it mean for uh you all to be focusing on on Ethereum improvement proposals at ETH Labs? >> Yeah, I know it's a it's it's a great question and uh yeah, we are incredibly excited to have Franchesco join us. He he's he's he's absolutely great, brilliant researcher. Um and and yeah, I I think um it's interesting. We get the question a lot with with with EIPs and collaborative nature like basically how how will that look going forward? I think because this this process of like how is Ethereum kind of like always coming to agreement on these new features to ship because it's relatively opaque um for most people paying attention I think there's maybe this impression of like oh it's this one group of people at the Ethereum Foundation that decides everything but in practice it's it's always been a very

collaborative effort even even to this point and of course the on the research side in particular so these like one two three year topics um it's been more concentrated in the past at the at the EF and that's now kind of like loosening more but but it's always a very collaborative um effort. I think I think um that that will continue to be the case and um I would say sometimes tensions are actually good and I would expect them to to occasionally occur in the sense of like so take the example of um shorter slots that's that's a feature that we are very actively looking at to propose for the upcoming Higot hardfork and we had some conversations with with our former colleagues um good friends at the Ethereum Foundation who are like ah actually we are a little bit worried here about some implications for our

work streams around like postquantum around ZKVM and and so basically like you know that's a tension like they might be like oh let's not do it and then but then of course like the productive thing is we sit down we're like okay like like let's let us understand these these these these concerns let us address them let us basically move forward in a way where basically we both think this is a good thing to do um so I think tensions only ever become a problem if basically um one side is is is kind of like has blind spot that that that they're unwilling to to to to be aware of and so I really believe that that that tensions are good um um and that we'll always basically like productively um work together >> okay I I did an interview with Joe Shalom and Joe Luben of uh Sharlink and

you know Joe Luben is obviously one of the co-founders of Ethereum and I posed this question to them and they really didn't like it. So I'm curious what you guys think but critics of this new org structure within the governance of Ethereum have said that it's a little bit like reshuffling deck chairs on the Titanic. You know a lot of your first hire came from the Ethereum Foundation. You all came from the Ethereum Foundation. What in your minds is the benefit of having this like more decentralized brokenout org structure as opposed to keeping all of these entities housed within the Ethereum Foundation? What are the benefits here? What are the trade-offs? How do you all think about this? >> Yeah, I think it's a it's a fair question, especially given our first title being Franchesco, someone we worked with very closely uh at the Ethereum Foundation, but when we

launched a month ago, we had on our website are five names and then a little mention of join elab.org. And so we really invited people to to reach out to us and not just like our close friends and and collaborators of of EF. And through this we actually received um about I think 400 applications. I've been going through like every single one of them. I've been uh running introduction calls with many many people like some of them like super talented some mostly coming from crypto but some people also just not crypto. Uh so I think moving forward people should expect that uh within labs like we're able to bring fresh talent either fresh talent from crypto who moves closer to core Ethereum development which I think

is is good uh or people that are just maybe were not in Ethereum previously and and are moving to this. So this not like any single profile just like generally speaking I I I really think this will be the case. So yeah, the trade-off obviously like bringing more people from different foundation would be well we want to chart our own path. We want to create a new culture and I think it's really important for us to to ensure that our organization like stands uh on its own under its own principle and and culture. So yeah I think for Franchesco it was obvious to us that he's so aligned with what we want to do the way we work and everything. Uh but yeah, I think we we have we had enough in blown from like really really talented people that we we we will

figure um yeah more more folks in the future. >> And just to get our metaphors right here, like if if we're shuffling deck shares at all, we're doing this on our like starship towards Mars and not not not all the Titanic. Like I think that that just doesn't track. >> Okay. So I will I will note down that I should stop using this metaphor because we don't like this metaphor. But I appreciate the thoughts on this because I do think you know there there's concerns and questions. So, I appreciate understanding the vision there if nothing else. Uh, Barnaby, I'm glad we got you into the conversation, too. I I want to talk about the work that you guys are doing at ETHLabs now that you have this organization up and running.

It's only been a month, but um, as I understand it, there is a sprint happening, but I want to just understand, is there lowhanging fruit that you guys think that you want to start with first? Like needle movers, things that'll really move the chains that are like the first targets to go after in terms of the work you're actually doing at Ethabs? What are those? How are you approaching that? What What are you guys working on right now? Yeah, I think some of the topics we are bringing also a little bit from our past at Jum Foundation like that was just a couple months ago. Probably the clearest lowhanging fruit in quotes because it's actually a very big fruit that we spent a lot of time and a lot of people working on it but now it's like ripe for the peing uh is the fast

confirmation rule. So, it's a it's a consensus uh rule like a confirmation that essentially allows people to confirm actions that are taking place on Ethereum 98% faster than the finality rule of Ethereum. So, what this means is you can process deposits and withdrawals uh to Ethereum in about seconds instead of previously minutes or maybe tens of minutes. So when you go on your centralized exchange and you're trying to like send money to Ethereum, usually like that's the slowest is is sending to or from Ethereum compared to every other chain. So with this fast confirmation rule, we can really like reduce the time it takes for liquidity to move around centralized exchange and Ethereum, Ethereum L1 and Ethereum L2s over

bridges and interoperability. So this means like just a huge improvement in speed for capital to to move around the network and the more um the less friction you have for capital. The lower the cost, the more like you create network effects, the more you invite liquidity to come into the network. I think this is like super super positive. So now this confirmation rule is essentially very close to production in every main client of of Ethereum and the work that we are going to carry Trulion especially is to go out into the world and really get people to to adopt this. I think that's something that we've seen sometimes in the past in Ethereum that we we create great great tech but we're not that good at bringing it to to the market that making sure that people adopt it and that they really benefit

from the from the features that we uh that we create. And so now I think as ELABS like we really want to make sure that it's not just great tech like it's actually great tech that goes into the world and that delivers like tangible benefits to to user in the form of faster uh deposits, withdrawals and just like faster moving around of of assets on the network. >> Okay, awesome. So let let's like take this a little bit further, right? So like Barnaby, I understand you're tasked with leading the dev sprint on this. Um, and for those listening who who aren't quite sure, the the Hegota, I think is how it's pronounced or at least spelled, um, fork is the one that is planned, the upgraded for Ethereum that is planned after Glamsterdam, which to my understanding is planned for sometime in

Q3 of this year. So, this is kind of like future work that's on the horizon. But, okay, Barnaby, you said you're you're focusing on getting these faster slot time confirmations in place. Once that development work is in place, once that upgrade happens to Ethereum, how does that then, like you said, like you have to go out and tell people about this and get them informed about it, get that adoption and and get them to use that, does that fall on ETH Labs? Does it fall on some of these other organizations? How is that responsibility shared? What's the strategy like go to market? I guess once these upgrades start to happen and not just Hogota, but like Glamsterdam and other things that are unlocked in Ethereum, what does that look like? How do you guys participate in that?

>> Yeah, I guess here there's two things. So the the fast confirmation rule is is a new feature that is expected to land in the coming months and and then the go to market I think we can carry that ourselves. So really communicate around the benefits actively engage in conversation with centralized exchanges L2s bridges for for the adoption of this feature. And you also mentioned slot times which is a feature that we are planning to propose for Hegota which is not the next for but the one after so maybe next year. Um and that's also like a really important feature in in our opinion. But unlike the fast confirmation rule which is more of an out of protocol things that other systems need to adopt the slot time is kind of almost transparent. So if you

are running on Ethereum and the slot time just decreases everything is just faster. So your wallet will confirm faster your transaction will feel like it's landing faster. All the markets on Ethereum their oracle and their prices will become fresh uh faster too. So it just like improves the UX uh let's say across the board. So here the audience uh to really make sure that this happens is is less systems outside that need to adopt it but more core developers of the ether protocol that need to be convinced that uh slot time reduction has a place in heota there's always a lot of debate and discussion on all cordes which is like the main governance entity of of ethereum protocol and so yeah you really have to make a strong case for why

should we spend the time shortening the slot when there are so many other features that are competing for for attention and development time and so yeah so we've been like working on making the argument uh precise showing the benefits talking to people who would also benefit from it like app developers especially in defi it's really one of the most demanded features at this point because it makes markets just much smoother like leak a lot less value uh to the outside so yeah so this is really the work that we have to do to to convince people that yes we need this in the in the hard fork for um the Ethereum protocol. Yeah.

>> Yeah. I think um to add on here, something that's interesting is that this shows how we can collaborate with the Ethereum institutional people. I was speaking with them this morning trying to validate uh what are you guys seeing in the market? Is slow times indeed like a thing that really pushes the needle for institutions. I'd say here we're quite high confidence. We've been hearing this repeatedly for years now, right? Uh but again uh something that they noticed is like finality is a big big topic that they have um um in discussions with institutions and finality is basically saying a transaction can't be reordered anymore if it's finalized and we can make that statement after for certain amount of slots have passed in Ethereum and so if we cut the slot duration we also cut the time to finality and so that helps them

again uh so I think here both in terms of validation that this is indeed the thing that Ethereum would benefit from most right now we can collaborate with the Ethereum institutional people um as well as in the the go to market to some extent as in they can spread the word to institutions and we can sometimes come in as a solutions architect and sure that's the product that we're building indeed is right uh for for the use case um but yeah that that just goes to show of the synergies that that are to be had there >> okay I want to ask a question about like where you guys focus in terms of like shorter term or longer term things Barnaby raised two things one is like the shorter term like quicker confirmations and then slot times is a longerterm thing that would be after

Glamsterdam like you know next year sort of thing. Let's take for example Glamsterdam which is coming in Q3. Is that now what you guys would consider more or less old news? Are you still doing anything related to work on the rolling out of Glamsterdam uh or like where is the focus for ETH labs in terms of like shorter or longer term goals for the improvement of of Ethereum? >> Um yeah I can also take that one. I guess we are all primarily really were researchers at the Ethereum Foundation and so as researchers we tend to be a little bit more upstream or like doing the road map thinking about the design and now Glamsterdam is really close to well still a couple of months but getting closer and closer to being uh released on mainet and so at this point the work looks more like testing a lot

making sure the clients interoperate with one another but that being said there is one of the headliners of Glamsterdam which is EPBS Yes. So I'm actually a co of that feature. Uh this is going to be a big change like both in terms of scalability like it allows Ethereum to scale the gas limit maybe between three to to 5x. So like a very a huge improvement not just gas limit but also the the blobs that L2 consume. But it's also changing in subtle but significant ways the market of block. So the way that uh proposers or validators on the network receive blocks that are built uh by block builders and so there I started paying attention a bit more to to the changes that are happening like

especially there's a lot of sometimes protocol uh intricacies that oh you have to change a little bit that feature but then that feature change might have like pretty big ripple effects on on the market uh because it's it's kind of an auction. Um, and so yeah, I've been trying to be more knowledgeable about all of these latest changes so that by the time the market rolls out like we we have a really good understanding of how it works, we we can already like formulate some hypothesis. Is it being deconentrated? Like are builders like better compensated? Are proposers like better compensated? So yeah, we we need to understand it so that uh once it rolls out, we can read the tape and understand, okay, are there still like

changes we should be doing outside of the protocol or maybe on the fly to correct like some of the uh issues perhaps that arose as a result of this new market um being deployed. So still a little bit of work, but not super active. >> You just said the word road map, which begs a question I want to ask. Ethereum has a straw map, which is sort of like we want to move in this general direction, but it's not as concrete as a road map. Is there a roadmap for ETHLabs? Is that something you guys are working on that might be announced in the future or are you not working off of that framework at all? Like is there a road map for Ethlabs?

>> I think we have something like a road map. It's not so the straw map is actually even though it's a it's a play on words of like strawman road map. It's actually fairly precise when you go on stap.org like you see all of these boxes. So it feels much more like a steelman than a than a strawman at this point. Uh we don't have such a precise road map at Labs. I think we we're trying to increase our level of confidence on specific work work streams. So as you heard like throughout the show so far, we've been pretty interested in a lot of making Ethereum fast. So like fast confirmation rule, fast finality, fast blocks, but there's also like other work streams that we're thinking about which are less close to the protocol, a little bit outside. For instance, interoperability for us is

very important. So making sure that you don't have just like a fast infrastructure but you also have like the right standards and the right security models for assets to interoperate between Ethereum one Ethereum 2s and perhaps other systems uh outside of of Ethereum 2. So I think interrup is probably ranking as a as a pretty important work stream for us and then there's other things where we're trying to build confidence in terms of our engagement. So scaling is this something that we need to be very actively pushing especially in the short term. In the long term ZKVM is going to be one of the major drivers of of scaling and this is something that we think EF is doing a very good job at at driving. So do we need to be more active on on scaling in the meantime. uh user

experience in Hegota. There is another proposal frame transactions that changes the way the accounts work and that also like gives a lot of uh optionality for wallets to to to give you better UX is this something that we need to pay attention to. So we we're still scoping a little bit. I think we have like different levels of confidence on different work streams but the ones where we are pretty confident like we're already pushing pretty hard on on them and I think the work for us now is to continuously inform the community about our thinking in terms of we think that's important propm everyone's talking about them this feels like really relevant to the mission of better execution on on mainet so yeah I think this is for us to build I I expect we have more confidence after a few months like we we really are

just getting started but we already see like some early threads where we can be very active and and deliver value quickly. I think I think this is something that's maybe important because there's all these you know as you said there's all these new Ethereum institutional um um all these different new entities and um so it's not maybe always so clear yet like where does everyone start in and so basically important for us when we say ELAB's road map or basically what do we plan to do the core protocol is a important pillar for us and it's it's where like in the short term right now in this conversation that's where we talk about the most because that's where we come from so we have the most detail that we can talk about there but for us it's it's very very important that again like now forwards facing like it's the future

of Ethereum's success is no longer determined by just infrastructure but really by like this holistic system like end to end basically like what does it take you know for like more Robin Hood chains to come to Ethereum for more like you know for for more for more um assets to come on chain like all all these all these kind of like real world um considerations and so our work will basically like split equally across these different different domains and so on the core protocol it's maybe more it's less about having a a a standalone role a bit more about like being like okay how can we take the lessons we learn by talking to the people um that that are using Ethereum that that we are convincing to come and and and and use Ethereum in the future how can we understand their needs and and basically

bring some of that back into the core protocol work but our our road map in that sense as as we basically iterate on it is much more about like all the all the steps across the different pillars that Ethereum needs to basically to get to get to that outcome. >> Okay, we can leave all the steel and straw maps behind. I I think it's really great we covered that. But Anscar, that's a great pivot because that's exactly where I wanted to go next. Uh growth growing Ethereum's user base has been named as a primary focus of ETHLabs. Just simple question. What is the strategy for accomplishing that? You know, maybe Julian, you want to take this one ahead of growth or whoever wants to, but what's the strategy for growing Ethereum's user base?

>> Yeah, so I'd say on growth there's there are two prones that we're interested in. One is distribution. So how do we reach more people? How do we reach more end consumers? And the other one is more the solutions architecture with something we call like demand to delivery pipeline. I think that's something that's burn slightly touched on before as well with for example this frame transactions that improves user experience and bring features to market. Um we want to ensure that any technical features that are made at the core protocol are brought to the users who most benefit from them. And also we're speaking with applications to know what are their blockers and be able to surface these as fast as possible so that that that information flows back to core devs to core researchers so that we can um actively do something with it and make

sure that those problems are solved basically that's a it's a very basic thing but it's something that's is quite fragile and also hard to do in a decentralized ecosystem right and we feel that we're well positioned uh to do that. Uh so that's one prone. The other prone is the distribution. I think here we do honestly still have to figure out more exactly what that will mean for us. Uh but something that we're very interested in is these consumerf facing applications that we're seeing pop up around the ecosystem. These things like Etherfy, AP, Robin Hood wallet, stuff like this uh that are reaching new people. Um and these people might not be like crypton natives. um they they probably aren't that familiar with how all the tech works, but that's that's exactly like the people you want to reach, the people we want to serve. Um

so we're excited about that. We're looking at how we can help distribution here. Uh obviously we're not building the product. So we have a different role as a growth team. Uh but whatever we can do there as like a neutral independent facilitator uh that is very central to Ethereum. Um perhaps there are some things that we're looking at with these teams. Uh and so yeah, we're excited to contribute there wherever possible. Real world assets like funds, treasuries, and private credit are still running on rails built decades ago. Gated, paperwork heavy, slow to settle. Everyone's talking about tokenizing them, but far fewer can actually do it and do it without cutting regulatory corners. Securitize can. It's the SEC regulated infrastructure bringing real world assets on chain. Nine years in, native tokenization, not wrapped, backed

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And you can trade them like any other crypto as margin in earn in grid trading. Tokenized stocks finally done right. Head to milkro.com/bitgget to get started. Ethlabs has been posting weekly updates on the progress on their uh Twitter page. Julian, you posted the most recent Ethabs update and you said something I wanted to get you to unpack for us. You said, "In the past weeks, I have spoken with hundreds of builders, devs, devs, growth leads, venture capitalists, and policy advocates from all continents ramping up on where the ecosystem is headed and where and how new users can be served. What have these conversations been like? What have been some of the key takeaways? Tell us a little bit more about that."

>> Yeah, I'd say in general, people are extremely excited uh for Elaps, which is which has been really heartwarming. um both before launching and after launching the reception has been really really good. So that's that's like a general thing. Uh I think in uh interestingly it's it's hard sometimes to zoom out and see exactly where an entity like ELABS can be uh useful. People are quite happy building on Ethereum. There is also like technical supports that exist both in terms of tooling and infrastructure which makes it quite an easy uh place to build. Uh there are some technical features that we could still help with to make sure that they are for example delivered better to the market. Uh sometimes when features are shipped uh it's unclear what's expectations are of different

participants. So for example, if you're a D5 protocol and you're expecting a wallet to ship something, but then if the wallet doesn't ship it, it's not useful for your D5 protocol, you might not actually use that that primitive. Uh and so that might be a feature that doesn't end up working out for you. So that's something where we would like to step in and make sure that like we act as like a coordination device and that people do what is maximally beneficial for everyone. Um, something else that I think is interesting is many pro schools aren't that ideological about which chain they build on, but still they gravitate a lot to Ethereum and its L2s just because I think the transaction volume and TVL that's on Ethereum and the L2s, which I think is like a good

sign of maturity. Uh, that's people aren't just here for the values, but they are also building companies that are that are worth building. Uh, and yeah, we're looking at how we can help them grow. There are some threads that we could pull. I think it's still too early to be too public about that. Um, but it's Yeah, I think there are some exciting things that we could do. >> Yeah. Well, I've heard you teasing that there's been a new hire at ETHLabs to help with growth. Is there anything you want to announce or anything you want to make public today or or do we have to keep waiting for announcements on that? >> It's awful. I'm just I'm just continue to see saying now that there's stuff that we should announce later, I guess.

Uh, but yeah, unfortunately here also I think it's it's up to this person to announce themselves. Uh that's expected somewhere in August, mid August perhaps. Uh so I think that's exciting. Um one of the key reasons why I'm excited for this hire is that this person can really help us make Ethereum like a really exciting place to be a builder, to be a young builder and contribute to the world. I think this person is very good at articulating it value proposition, not just as like a um a cipher punk ideals, but actually like as a as a product value proposition. Well, it's very flattering to hear you speak so highly of me, Julian, but I already have a job right now. So, uh, I do want to pivot this in a different direction, though, because, you know, we've talked about growth, we've talked about L2s and a lot

of new users coming to Ethereum. Obviously, a big piece of headlines was Robin Hood launching the Robin Hood chain. Um, and this has kind of restart sparked a lot of debate about value and how much Ethereum should be charging L2s. Um, so for those who don't know, Robin Hood chain is an Ethereum based Ethereum L2 or sorry, it is an arbitrum based Ethereum L2. Uh, and it has brought, I think, close to 30 million new potential users into the ETH and EVM ecosystem. However, critics have noted that most of the value of the fees and and the revenue here is going to Robin Hood, Robin Hood chain, and into Arbitum. And then, you know, I've seen posts on Twitter basically saying that Ethereum is only getting like a couple thousand dollars of revenue from all this activity. When I interviewed Joe

Luben, I think two weeks ago now, um I asked him about this and he said this is part of Ethereum's growth strategy to keep the fees low, to continue to bring in L2s and users and continue to grow Ethereum's momentum and inertia. But then a lot of critics say that Ethereum and ETH asset particularly are suffering a lot from this. Where do you all land on this conversation? What are your thoughts on this? And just how do you think about this as you continue to try to push for Ethereum to become the root of the global uh financial ecosystem? Yeah, I mean I think um this is one of those topics where I I think I I I see this in Ethereum a lot that people have legitimate questions and criticism and then in the end completely end up overshooting. I think you know like on

Twitter is that that happens a lot and I think this is really one of those like mid-curve things like I think if you if you see Robin Hood chain and you're not excited for Ethereum I don't know I think you're like squarely like you know I don't know I mean I I don't know what what to tell you. I think the kind of like the element of truth in there is of course like okay but like it's not good enough to have indefinite optimism of like this is abstractly good like you have to have a vision of like okay how how can this play out in a way that actually ends up benefiting Ethereum and that's that's a reasonable question and so I think uh we are at the very beginning of of of this kind of this wave of the the real world now coming on

chchain that's where we you know talk about the the root of the the global economy I actually I in the beginning I always said the root of the onchain economy and someone was like oh onchain economy what does that mean it's like no I mean this is what it this is going to be the economy you know like people used to say the online newspaper now it's just you newspaper of course it's online you know like that same thing will happen with the economy like and but this is the very like early elements of course crypton native that has been much more mature by now but like the the kind of the the bridge to the real world it's it's it's only growing now and so these these projects are coming on on um onto Ethereum and and so so what does it mean well so Robin chain like let's fast

forward five years you have like a hundred Robin chains right you have like all kinds of different startups, fintech institutions, whatever. Like two main ways in which this um well three ways three ways really in which this is this is great for Ethereum. I think by and large the the the biggest one is all of these chains individually kind of like sit on top of Ethereum. So you know like you have assets in in chain one, you have asset in chain two, there's some sort of like economic activity you want to do like where does that economic activity happen? Well, of course on Ethereum one, right? Like that sits in the middle. That's where you kind of like you meet. So basically like Ethereum deal one as this like this this economic hub for for like crossplatform activity like that's that's an obvious growth factor where of course that

doesn't work if you have one chain that docks into you. You need like you need the flywheel. You need the network effect but but basically that's why it's so exciting like for years and years there was the vision of this will eventually happen. Now it's starting to happen and now people are like ah the vision was wrong like no now it's now it's getting real but but it means you have to actually make that happen right. You have to make sure like what what does it need architecturally for the L1 to be the perfect fit for this right like you don't want to end up in a world where the L1 for some reason basically like is has so high friction that it shrinks into some sort of thin you know switching board and everything else happens just in the L2 so like you do

have to have that concrete vision so you can actually build the L1 towards that right so that that's that's one like the L1 is like the the kind of the this this economic kind of like um settlement layer between those chains uh the second one is ETH ETH itself kind of like demand for ETH ETH flowing into these different chains having um um increased distribution. A lot of these these fintexs bring their own user bases and and you we you already saw this um I forget the exact numbers but like I saw stats of like a lot of ETH flowing into Robin Hood chain like immediately. So like these are all new surfaces for people to to use ETH in productive ways and and to create demand for ETH. So that's that's the obvious second one.

And then the third one, yeah, of course, fees. And there I would say um it's it's it's almost like a trivial thing, but like of course you need to like build out these synergies of like the more Ethereum is valuable for these chains, the more these chains will be valuable for Ethereum because then Ethereum can capture some of that value, right? So like it is our prompt of like how can Ethereum be maximally valuable for a Robin Hood chain for a you know like whatever the chain for all these different chains like what services like that's what where we come back to interop like what offerings like what what do we need to do that being on top of Ethereum is like something where it's like how could you possibly do anything else right like it's it needs to be a no-brainer if if a new financial

institution comes on chain of course they're going to do it on top of Ethereum and they're willing to basically like you know like to to to make sure that there's that that value kind of um it goes into all the places. So, so I think three simple pillars again don't midcurve it. Um but but you do have to have a vision for like how this benefits Ethereum. You can't just be vaguely optimistic. >> Anyone want to build on that or can I go on to the next question? I know there's a lot there's a lot in that topic. All right. Well, I'll I'll keep proddding on this. Uh Barnaby, I want to ask you a question about this. Vitalic recently or not long ago tweeted out that the old vision for the L2s on Ethereum no longer makes sense. And there's been a lot of

talk about what does make sense. Now I saw on on Twitter you shared an article titled how L1's and L2s can build the strongest possible Ethereum and I would really love to hear you try to articulate this for our audience and what is the updated understanding of the L2 vision in Ethereum and and the strongest version of Ethereum. >> Yeah. Yeah. Yeah. This tweet sent quite a lot of ripples in the in the ecos and the post that I shared was was written I think a month after that to explain you know this is this is what it means for for this new reality. And to be clear, I'm I wasn't one of the authors of this post. It was George Rudolfph, who is one of our co-founders, too, and George Stark, who was formerly uh in the EF management team. And so what they were

trying to articulate is that there's ways that Ethereum can make L2 stronger. Like usually people on Twitter have highlighted that fact and said, you know, yes, obviously Ethereum is making L2 stronger. That's not to the benefit of Ethereum. But it goes the other way around. like L2s also make Ethereum stronger in in many ways. And so when you look at well Robin Hood only paid like this trivial amount of fees to Ethereum like how can this be a beneficial relationship? I think what the post was trying to say is looking only at the fees that are being paid to Ethereum. It's just like you're projecting something very complex on on like this one dimension that completely obscures the fact that as was saying so VL2 first brings a ton of new users to Ethereum like that builds the network

effects for for the platform as a whole builds distribution for EV asset uh is able to innovate in ways that L1 is not able to innovate and I think that was really the what the tweet was getting at to say we were thinking of L2s for a long time as networks that are meant to extend Ethereum the way Ethereum would extend itself if it was able to to scale. Uh but this is not really what we've seen happen. What we've seen happen is L2 is actually trying to differentiate from Ethereum. So when you are a product builder, when you want to go in the market, like the first thing you learn is your product needs to be

differentiated otherwise you you're just not going to make it. And so the L2s have by and large like many of them differentiated on many different dimensions can be either go to market or technical features or the types of uh apps that they were incentivizing for for for coming on on on their chains and so and so that really builds uh in a way a complimentary relationship where the L2s can do things the L1 can't and the L1 can enjoy the extra liquidity, the extra users, the extra attention and network effects and and really like grow as the settlement layer that's rooted at the center with if kind of powering uh all of that and becoming the base pair

for for many assets that are native to these L2s even. So this is really what the post was was trying to articulate here. >> Okay. I I appreciate you all laying out the vision on this. I think I want to bring this conversation back to Ethereum the asset ETH the asset because I think one of the consequences for the strategy the roadmap you know what's been built and and and the relationship with the L2s one of the consequences is that my observation is that there seems to be a bit of an overabundance of supply of ETH as an asset um and it seems like it's outstripping the demand right now do you agree with that assessment is that how you see this and how do you think about approaching that as a problem and plan to solve this so that we do see this uh

supply demand balances for ETH as an asset start to come more in line with you know let's say number go up uh who wants to start with this one >> yeah no I mean I I I can take that um I think the way I would frame it is well one I do think and that I always say that because actually like I had a podcast like when we were launching like the very first week and I actually was like okay let me go on coin market cap just so I'm like fully you know like back in the loop on like all the asset prices and whatnot and and I was like wait a second like this is in a way like more extreme than I I remembered. There was like I don't know if if this is true today but like there was like two weeks ago or something I

think only eight uh cryptonative assets. So like excluding the stable coins um I think above $10 billion valuation and only two above 100 billion right and obviously ETH being one of the two. Um, so I think it is first first pass of course like Ethere ETH and Ethereum is incredibly successful, right? Like why does it feel so bad? Like it feels so bad because like ETH had that incredible success 5 years ago, right? And ever since it's like sideways and I mean look my net worth is tied up in this as well. I I feel the pain and but no no it's like so it's not that it's failing. It is that like it had the big success. I think people believe the vision and like the vision is coming true but it's like okay but what's next? Okay, you you

convinced me you're a hundred billion dollar asset, but can you convince me you're a trillion dollar asset? Like there's not that many trillion dollar assets on the planet. Um what's what's your what's your pitch? What what is what role what what exceptional role can ETH play? And I don't think we have like I don't think ETH has given the quite a convincing quite a full fully like comprehensive answer to that yet. So like I think that's my my reframing. It's not that we are failing. It's that like we need to take the next step. We need to really have a clear vision of like in five years if if Ethereum goes well, if ETH goes well, like where are we? What role does ETH play? what what role does Ethereum play to enable that?

Um, so so so that's the overall framing and then I think also we internally like obviously like we're coming from the F it was always like a side hobby for us to think a lot about ETH but like it wasn't it wasn't like part of our day-to-day job so much and now we specifically made the choice to make that part of our job. Um I think it would in a way be also like a little bit silly if I come on now after like okay we've thought about it for a few weeks like now we have all the answers that like the ecosystem has thought about for 10 years you know like that's silly. So like we're talking a lot with like a lot of the the stakeholders like this is one of those things where I think we can just play a huge role is like it's not

that we're the first to think about this. It's it's really just that like in many of these topics there's like the people building the protocol and the people thinking about ETH they're just different groups and they don't talk so much to each other. So like really just being this connective tissue just reaching out to the people that like you know that that have all these the deep thoughts and just understanding their perspectives going back understanding like basically just I think I I see the role of ELABS as like a lot in tying these things together like helping us create like a shared vision of the future and helping us together get there. So I don't have super clear answer right now. I have a lot of like individual thoughts on this of course.

Um but I think the important thing is like not we have to get away from indefinite optimism of just leaning back and being like ah ETH will be ETH will go to 10K go to 100K like it'll just be great you know just we we just have to lean back and wait to definite optimism like Ethereum is in the po position again it's the most valuable smart contract chain out there like by and by long by like a long long margin we are in the absolute poor position but we need to have a clear vision of like what does it mean to succeed otherwise we won't just get there for free and so again best we can do for now like state the intention and like really really start bringing these these stakeholders together, have these conversations.

We're having them already. They're going great. And then basically like we'll um in the coming months basically like have have much more of like a clear like okay this is the concise case for like for ETH and like these are the changes for the protocol like as as the economy comes on chain that we need to make to make that a reality. >> I appreciate those thoughts. I I think u you know for me you know first of all I think it's a little bit terrifying to hear you say like thinking about eat the asset used to just be a side hobby. So, I'm glad that's not the case anymore cuz wow. Um, but I think that these new players of Sharlink and and Bitine as these large digital asset treasure companies that are focused on ETH have become much more aligned around not only

ETH the asset but telling the story and and taking that to market. Tom Lee has been a great advocate for that. Joe Shalom has been as well. And both Bitmine and Sharp Link's names appeared at the top of the donor list for ETHLabs and for several of these other entities. Is there dialogue in collaboration with those digital asset treasury companies around sto telling the story? What has that been like and and what have those conversations and that partnership been like with with the DATs? >> Yeah. Um I think also not everybody all at once. You can go right ahead. >> No. So um I think it's it's ob like it's it's it's obviously like a natural fit.

Um as we as we got started and we were thinking about who to first approach about like hey you know like we we have this new project um can do you want to help us get off the ground? um very quick very quickly like the dads just were like a like at the top of the list of just like in terms of I think if if if we are successful I think what we're trying to do is really help two sets of people prim first and foremost which is the ETH holders and the app builders on Ethereum and the app builders is of course it's a very distributed set of people the ETH holders is to some degree as well but we have the the luck that there's these these these few entities where that just individually make up um a big portion of the set and so that

that really helped us to just have it an initial address, an initial kind of set of people to talk to. Um it's I I think for Ethereum it's been incredibly powerful to have these people come in to have these these I mean obviously in in the case of Sharp Link um kind of through the association with Dubin of course it's not just someone new coming in but but either way also with Bitmine um it's it's a completely fresh perspective. It's people that that appreciate ETH directly for for being ETH not just people that buy into the broader vision of Ethereum and like it's like well then clearly this will be good for ETH. like no, ETH specifically is the thing we're excited about. And and so talking with them, I think it's it's been it's been incredibly powerful to to really like focus on, okay, like what is

the like the the lens that centers ETH? Like a what what what can we do in terms of like you know our work like like what um what kind of like pain points are there in terms of concrete? How can this protocol evolve to to supporting ETH better? And then also B, how can we help bridge? How can we help um tell that story um better and really shape shape a narrative profile for for for ETH? Um so I I think I think it's it's it's a very like natural and exciting kind of like part of the evolution of Ethereum to have to have these entities play a larger role.

>> Yeah. To add on to that, um Sharplank and Bitmine have been incredibly helpful with getting us off the ground. Um like they really believe in the mission and they've been super helpful just like making sure that we can uh get started basically. Um so yeah very very graceful there. Uh something that's interesting on the collaboration path is we're looking for distribution not just for Ethereum block space but also for ETH the assets. I think it happens naturally as people consume Ethereum block space that they also consume E the assets. You see this happening with L2s with Robin Hood as well. Um but also if we want to distribute specifically ED assets, these digital asset treasuries are obviously good uh partners for us to to help do so because they are the buyers of these assets and they also know what these

other buyers are like and then they know the reasons why other people who are potential buyers might not have bought in yet. Um so that's something that we uh could do more in the future of and are looking to do with with the partners uh to make sure that we understand basically what are parts of the value proposition that are extremely appealing but perhaps not completely uh brought to life yet and who are like potential buyers of ETH uh that we could approach and help um yeah appreciate the assets. >> Okay. So we've talked a lot about the vision making Ethereum and ETH the root of the global economy. We talked about what ETHLabs is, how you guys are part of the ecosystem trying to do this. I'm curious what you all need right now because obviously it's a very young organization. You're hiring, you're

interviewing. Is it more devs, more donors? What are some of the roadblocks? What what could people do if they if they wanted to get involved to contribute to help and and how could they reach out to you to do that? >> Yeah, that's a that's a good question. Actually, we announced I think today or yesterday, Josh sent a tweet saying that we are closing our round of fundraising at the end of the week. So we have our encore funders like Sharling, Bitmine, um others, other big ticket funders and we also had like this community round like a lot of people from the community uh very graciously like came and and and wrote checks for us. So we are uh we have a round two of this community round that we that we'll announce there. So I think you can get in touch with us if you if

you're interested. Um otherwise we are trying to um yeah address all of the inbound that we received either for hiring or just general interest want to collaborate want to make your perspective known about as a as an if enthusiast or as a as an app builder. So we are able like to route things pretty uh pretty well throughout our organization. So yeah, I think the more signal we get from the community, the the better we we will be at uh scoping our work, messaging messaging around it as well. And you can really reach us through every channel like we're all on on Twitter or email at join elabs.org.

Um yeah, we'll we'll see you. >> Okay. Well, I think we we got to start wrapping this up. I've kept you guys for a really long time, but I just want to ask one question. I was on the fence if I was going to ask this or not, but like how are you guys doing? Crypto Twitter is a civil war night fight. Everybody is angry, rage quitting. Like what's the vibe with Ethlabs? How are you guys getting through this? Like Yeah. How are you guys? Like I don't know. Just like how you doing? >> I think we've been extremely excited. It's it's been doing it's been doing great. I mean uh launching Eth Labs has truly been incredibly exciting. The reception again has been insanely uh good. So I'm very happy with that. Um obviously like there there's been a few bumps in the road before we arrived

here. Uh but I' I've been enjoying the roller coaster. Uh I'd say um so yeah, I think it's very exciting. Um it's it's sad to see that so many layoffs are happening across the ecosystem and yeah, I think that's that's probably the most disheartening part. Um I think something that I'm personally very excited about that it is a very good time to be building. Uh both like bare market vibes are always a good time to be building, right? And with the power of AI, it's so much easier these days. Uh so I hope that people are betting on themselves and making stuff happen uh in the Ethereum ecosystem or elsewhere. But yeah, in general I'd say Vibes Aslabs are are are sky high in the honeymoon phase. Yeah. And and maybe just to say I

think to the to this to the degree that we can help >> a little bit with kind of Ethereum kind of find towards get towards a shared vision of like where do we all want to go so that like because there's as as Julian was saying there's like all these incredibly talented builders some of which just because of the circumstances like obviously like um um maybe are not able to continue with their current projects like if there is like a clear vision of like this is where Ethereum is going these are the the needs like these these are where like where where additional hands are needed right now. I think it just helps people also that want to keep stay that want to like keep contributing to basically find a place where they're like okay I understand like here is where I can contribute. So

I think we also again not to be like overly like obviously like we can we can only but like to the extent that we can help basically like help the ecosystem um kind of coales around a shared direction. I think I think that that that that helps in those times as well. >> Awesome. Barnaby, anything to add to that? >> Nothing to add. Also super excited. I feel great. I'm really really happy we pulled this off. That seemed quite crazy to me not not long ago. Uh but yeah, we we're building this thing. We we're all like really enjoying ourselves, really enjoying talking to the community as well. Many new people that we've met uh through this. So yeah, I I think we we'll only keep increasing our momentum and hopefully like be a positive force for for Ethereum.

>> Yeah. Well, just speaking for myself, I was feeling a lot of this like frustration and like this the bad vibes on crypto Twitter. So, I wrote this essay called wartime Ethereum and then like two weeks later you guys launched this and I was ready to run through a wall. I was so excited. So, I don't know how all this is going to work out, but I am really appreciative of you all for the work you've done, the work you're still doing, and the work you're going to do. And I really appreciate all of you coming on Milkro to share with our audience about this because I think there's so many people who want to know what's going on, what they believe in your work and what you're doing. So, thanks for coming in here, being so transparent, and sharing with us. You're all welcome back anytime. I'd love to

get you guys back on and get a check-in, you know, down the road and see where things are. Um, but in the meantime, thank you all so much for being on the Milk Road Show. And thank you for everything you're doing for this industry. >> Thank you so much, D. Thanks. Thank you so much. >> Thank you all for joining us. I hope you all learned something today. So, until next time, stay safe, stay educated, stay bullish, stay Ethereum, and we will see you all on the next episode of the Milkro Show. Thanks for being here, everyone. Bye. Want insights on what's moving crypto markets and how we're trading each event? Subscribe to our channel and join the Milk Road daily and pro newsletters and start investing like the top 1%. This show is for educational purposes only. Nothing we say is financial advice. Investing is risky.

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