Gas limit increase, Massive ETH ETF flows & more - The Daily Gwei Refuel #822 - Ethereum Updates

Transcript

hello everyone welcome to another episode of delway refuel where up the latest news in etherum ecosystem I'm your host the 5th of February 2025 all right everyone let's get into it so a big day for the eth ETFs today I know the markets have been volatile over the last few days I think they're just generally still digesting the Trump presidency uh you know it hasn't even been a month yet since he's been president I think it's what been a couple weeks two to three weeks right since he's been president a lot of different headlines going on and the markets are kind of teered just especially the crypto Market stock market seems to be okay but the crypto markets are quite teered around this we had some fresh headlines I think about China putting some new tariffs on the US but I mean I don't think anyone really

cares about that it was just Traders maybe taking advantage of a bit of the volatility but regardless of all of that the E ETF still had its biggest inflow day today of or I should say yesterday of 37.8 million so you can go to The Far Side website here which I've shown on the refill before and as I said I don't think I don't know if this is the third or fourth biggest day in the E ETF history uh in terms of like inflows but that's a pretty big inflow especially considering the price went down so much right like you guys know that the eth ETFs launched at a price of around 3600 when eth was around $3600 it began trading there so for them to buy at around what 27 to 2800 I don't know like I I feel like that's a confidence BET

right that's this kind of big money try plays being like this is cheap you know e is too cheap here we should buy some eth here and of course I get the usual questions whenever I tweet about this people asking why isn't the price moving so on and so forth you know and I've explained all this before on the refuel but tldr it's not that simple it's not just like these entities are going to buy $300 million worth of eth and the price is going to go up uh when they do that especially considering that even though this is a large amount of money its market cap is what $330 billion um after the crash right so $300 million is not a lot when you compare that to to that market cap it's like what 0.1% or something like that so yeah it's not really going to move the price too much

but the whole point obviously of the ETFs is their cumulative effect here and if you actually look here at the cumulative flow into the E spot ETFs it's many many billions of dollars you can see here in black rocks eth ETF uh I believe uh yeah it's here so they have a total inflow of $4.4 billion here Fidelity at $1.5 billion and then a few hundred million between the other ETFs here as well and then of course scales e has a lot of e sitting in it still uh even though it's had a bunch of outflows uh you can see that on the chart here as well and you can kind of see what the E outflows have been versus gbtc kind of followed the same kind path and seems to be leveling out a little bit higher than gbtc but the same kind of thing happened

uh happened there now terms of what this looks like going forward I don't know like does this trend continue right do people think or does the trade fire World think that eth is at a discount here I think eth at a discount here and that's not investment advice but I I do think it is it is quite cheap around these levels right uh and I think that with the new kind of arm that we have making inroads into Wall Street and into Trad five with etherealized with consensus um I guess like stepping up to the plate again they've become a lot more active lately and also kind of um other things going on in the ethereum ecosystem to reach out to these tradire people and reach out to these Wall Street people I think that we're going to see a a kind of like Resurgence here

and yeah I don't know like I I I know that everything has been kind of gloomy because of the market action I know that e been kind of gloomy especially but I'm still feeling really bullish about things guys and maybe that's because I take like a longer term uh view here I don't well I I try not to pay too much attention to the short term uh but yeah we'll have to see uh how that goes and how these inflows continue here uh it was funny because the BTC ETS have also had strong inflows lately as well um the day before yesterday they they had a negative oh sorry a net outflow I should say today they only really had uh they had sorry they had a big inflow from Black Rock but Black Rock actually had more eth inflow than BTC inflow for BTC they

had 250 million for eth they had 276 million so yeah there are there is definitely an appetite there for eth it's not like eth is not an asset that people want to buy and one last thing I'll say about this is that when prices tend to crash like they do where essentially if you're like someone with a lot of money and you want to make you want to get into an e position when price crashes like that that's probably a better way for you to kind of get an entry than trying to buy on the market where things are either going sideways or up because your buyers are going to have less of an effect on the price which means you're going to get a better entry for your order so for example let's say someone wants to buy a billion dollars worth of eth right well if you

want to do that really quickly you can go OTC but that has an effect as well because I don't know what the OTC markets are like but I I very much doubt there's many OTC Brokers out there that would have a billion dollars of eth waiting for you to buy right I don't think there's going to be that many out there so they're probably going to have to source that from different places that's definitely going to be felt by the market but if you want to get into eth really quickly and you have a billion dollars then the better way to do it is wait for I mean if you've got an appetite to wait here the better way to do it is do it during those Mass capitulation events those Mass kind of um liquidation events where essentially you're like well okay uh there's a lot

of liquidations going on here there's a lot of liquidity coming in because of this I'm going to buy the Bloods so to speak because I was going to buy open this position anyway so this seems like a good time for me to do that so yeah I think there are there is elements of that going on uh for sure because as a bigger player like not everyone's like sailor where sailor has you know no I guess like worry about where he buys he'll buy the local tops you know he doesn't care right but most people pretty much everyone else isn't like that doesn't have what I guess like the money printer you could say that saor has and isn't a crazy billionaire like saor and a lot of them don't it's not their own money either right they're managing other people's money so they can't be Cowboys with it so when you

take that into account you can kind of see why these things can be opportunities for for people but anyway we'll see how these flows continue as time goes on all right so alexand Alexander grieve here from Paradigm tweeted out that the new SEC Comm oh sorry I shouldn't say new SEC commissioner the existing SEC commissioner Hester Pierce announced the initial list of priorities for the SEC crypto task force and what they'll tackle here so these priorities include the security and commodity status of crypto assets that's basically number one I think um you can see here on this on this list here yeah that's number one which it should be because there's just like zero Clarity around this for most people uh they want to identify areas

outside of the sec's purview and Define them as such no action letters Etc they want to look at token offerings uh they want to potentially issue a safe harbor which means that you can do your token offering and then if you potentially like decentralize over time then your token will not be classified as a security later on they want to do registered offerings of course uh they want to do custody for investment advisors uh and and so on and so forth yeah you can read this whole list I'll link it in the YouTube description below but the reason why I'm bringing in this up today is because well not today but just generally is because as Alexander says here this is a complete 180 of the SEC under Democratic Leadership obviously as we know under the Democrats the SEC was incredibly hostile towards crypto G ginla very much was on the war

path against crypto for whatever reason and they stonewalled pretty much everything they went after all of the top crypto companies with just baseless lawsuits and subpoenas which all seems to be being reversed at this point they haven't been pulled yet like the cases haven't been uh withdrawn yet but honestly like they I think they're either going to get withdrawn or just like left to Wither on the vine and die off on their own I don't see this current SEC um under the current leadership that it has continuing on with those lawsuits uh and wanting to pursue that there and I don't see them bringing actions uh bringing forward actions on any other companies unless they're doing something blatantly illegal and blatantly in violation of Securities uh laws but hey I don't think many people are doing that and the ones

that are I mean they they're doing it in a very kind of I guess like loud way and they usually get caught if not by the SEC but like by by the Department of Justice or something like that because they're doing more than just securi fraud they're doing like literal actual fraud right I mean Securities fraud is fraud but but you know what I mean like they they're not only um uh uh creating like a unregistered security for example but they're taking people's money they're scanning people out of their money and so on and so forth so really really cool to see that the SEC is finally in the hands of some I guess leadership that doesn't hate crypto and actually Embraces crypto so we're going to have to see but this is what I was saying leading up to the election when I said you know if Trump won and the SEC

became more crypto-friendly I don't want to just have people talking about how friendly the SEC is and the SEC saying wait we love crypto I want to see action and this is action right here guys like the this is basically H Pierce saying this is what we're going to tackle this is what we're going to do for the foreseeable future and this is how we're going to make the crypto ecosystem a lot better in the US which is always uh good to see here but anyway you can read the full list I'll link it in the YouTube description below for you to do so all right so the gas limit on ethereum L1 has been increased to 36 million you can see here on Tony's website that the gas limit signal went over 50% I think it's around 50% it's like going a little bit under going a

little bit above as time goes on but we have a gas increase now which is a 20% block space capacity increase it went from 30 million to to 36 million here and this is only step one guys like there are more uh gas limit increases coming especially over the next 12 to 24 months it's going to become potentially exponential in terms of how we increase these gas limits you know in terms of how we increase the gas limit and I've talked about this in the past so I'm not going to repeat a lot of the stuff that I've said in the past year but Trent said you know what's next year after this in the immediate future well the Petra upgrade is going live in March we're going to get more blobs we're going to get superpowered EAS AKA account abstraction with IP 7702 validated improvements with EIP 7251

which is of course the max EB um uh EIP we've got history expiry going live on May 1st or at least the first phase of that that does not require a hard for that is just going to happen on May 1st the clients are all in agreement about this and that's going to be great to for keeping the chain size bounded essentially or at least somewhat bounded especially in the face of a uh I guess 20% increase in the chain size which is effectively what a a gas limit increase is and then we've got the faka upgrade which is slated for around Q3 so far or at least estimated to go live in Q3 which is going to include pias which gives us a lot more blobs and uh potentially eof which is the uh set of eips that has been in the works for

years now and and that's probably going to make it in alongside Pi Das there so a lot to look forward to on the ethereum scalability front guys not just here but into the future as well there are so many more L1 scalability upgrades coming there are lots of new l2s going live as well uni Chain's going live soon if you've forgotten uh Mega eth is going to go live soon rise is going to go live like these kind of like high performance l2s are going live we got Bas and Native rollup stuff happening and this is all happening in parallel to scaling up the l1's sorry scaling up the L1 for l one itself so for the normal L1 transactions but also for blobs which obviously appli to to l2s so a lot of great stuff happening there but anyway I'll keep an eye on the gas limit signaling hopefully

we can get this up to most of the network doing this and then from then on we can increase it higher than 36 million all right speaking of Pier Dash you can see here that Manu has put together a really nice document all about peer Das now I do want to warn you that this is quite technical it is not for the faint of heart it is not something that's going to to hold your hand and explain to you what pias is what uh blobs are what sharding is what kg commitments are so on and so forth it'll give you an overview but then it'll dive deep into the technicals of how this all works as you can see on my screen this as I said is not for the Fain of H but the reason why I wanted to um I guess like bring this up is because

it's still worth reading it it's still worth getting your hand head around this stuff as part of just your wider knowledge uh base for uh blobs for pias and to get really excited about what's coming because when when I read these technical things obviously I don't understand everything as you guys know I'm I'm not like super technical or anything like that I'm not a core developer but just reading this gives me a better idea of how core developers are thinking about this what blobs are going to look like uh with pias and going forward and what we can expect in terms of scalability increases for the l2s because a common criticism of um of ethereum Da and ethereum rollups generally uh is the fact that we don't have enough blobs and I agree with that criticism we do not have enough blobs to serve the current role UPS let alone the

Roll-Ups that are going to be going live and using Etha coming very soon you know uni Chain's going live as I said very soon there um I I I don't I know that Mega eth and Rise are using offchain da but honestly like if we can get it so that they don't have to use offchain da that would be a really huge win uh for for for ethereum as well of course and that's the whole point of scaling up blobs getting things like pias in and making sure that we can keep ethereum da uh competitive and uh as from from my understanding of this as well you actually do need to use ethereum da if you want to be like a based and Native rollup uh you can be based without ethereum da from my understanding but to really get the superpowers of Bas and

Native rollups you need to have a a unified settlement layout and what that means is you need to have your proofs and your data posting to the same L1 otherwise the other rollups out there or the other l2s out there are not going to want to interoperate with you because they can't trust that you won't be Reed by something else happening off chain but they can trust TR that if you are on the same settlement layer as them then you're all under the same conditions you're all under the same rule set so they can trust that if a Rog happens it happens to everyone because the Rog would be on ethereum L1 the Rog would not be on some other da layer or some other L1 for example and that's really the superpower that we get from based and Native rollups but in order to to

inherit those uh kind of powers there you do need to have unified settlement which is I think what we're going to get hopefully with like most of the rollup settling to ethereum because we've scaled blobs for them there but anyway you can go give this a read for yourself I'll link it in the YouTube description below for you to do so all right so I put out a tweet last night before I went to bed and maybe I shouldn't have gone to bed after putting this out because it kind of blew up but I essentially um put out a tweet asking people what which of these three powered by ethereum logos do they like best and we'll kind of finalizing this little branding push that had started back in around a Devcon here now the reason it blew up was I guess two reasons one

everyone kind of picked what one they liked best out of the three but two I think people got the wrong idea about what this is and started criticizing it and started like coming at me saying you know this is really stupid like what brand agency did this you know this is this doesn't look like anything serious blah blah blah and the the point I want to just clarify today is that yes it is not anything that's meant to be like super serious it is not a it's not like a really organiz effort where we do you know branding meetings and we do user interviews and anything like that this is literally me and a few killer people in a telegram group going back and forth on some designs for a powered by ethereum badge that that projects can put on their website if they want to or

not that was it there is no grand plan here this wasn't supposed to replace any ethereum branding it was supposed to complement the existing branding it was a fun little side project that I was involved in people but but then people just thought that this was so much more than what was which was very puzzling to me considering that I had tweeted about this before but I guess like armch critics are everywhere right uh and I clarified this in in my follow-up tweet here because a lot of people also thought that this would had something to do with the ethereum foundation which again is bizarre to me considering that I never mentioned the ethereum foundation in any of my tweets but yeah no it doesn't have anything to do with the EF as I said it's me and a few other people I don't want to doxs Who's

involved with this uh just in case they don't want to be docked especially after the fact that everyone just all over their not everyone but a bunch of people all over their work but it is a bunch of really cool people that have been working on this you'll know a lot of their names if I was to say them but again I'm not going to dox these people it's just been really cool uh working with them and as I said it's a side casual project there is no Big Brand agency working on this everyone that's worked on this has worked on it for free there's no money being given to anyone here no one's making any money from this um and I've explained before that we went with powered by instead of like secured by or built on because secured by can be very misleading like

yes the l2s in their end state are secured by ethereum but a lot of l2s today are secured by multisig so they don't deserve to have secured by ethereum on their website right that's just misleading to users the built-on thing the Buon was done six years ago as part of EAB so I wanted to kind of go in a different direction and really Buon doesn't kind of capture everything I feel like powered by captures everything um and and and yeah that's why I went with that um with that's why I went with that there and really the spirit of this kind of initiative was to copy the Intel Inside kind of branding that they did for a while there where everyone knew that as soon as they saw that sticker it was a mark of quality right it was a mark of oh okay they've got an Intel

processor their computer must be good sort of thing cuz that's what I thought when I was growing up and I saw Intel I'm like hm Intel these days I actually run AMD CPUs in most of my boxes that I have my main PC that sits right behind me uh the one I do all my work on and do all my ship posting on that runs an AMD uh CPU and I've had no issues with it at all but back in the day intel was King Intel Inside was their way of making sure everyone knew they were King so that was my idea behind powered by ethereum because I wanted people to know that this is a mark of quality this app is on ethereum it's part of the ethereum ecosystem ethereum only has you know the best we we we service the best we have

the best apps and and things like that so anyway uh The Fallout of all of this was basically that I told people if you've got a better idea if you think you can design something better DM it to me uh or if you want to get involved you can and a few people have gotten involved they've joined the telegram group already and they've got their own kind of graphic designers on it and they're working on it in the background I love that I love that because it's more than yapping I hate people who just Yap all the time and just talk all the time like I'm out here doing stuff and then I get criticized by people who do nothing like I'm sorry but that just annoys me and I know I'm being a little bit rany here but it really annoys me when I see the same people just

constantly critiquing things on Twitter and they do nothing they do nothing to improve the situation at all like yes constructive criticism is good but if all you do is criticize things and you don't actually do anything to make it better or to help the ecosystem then really you're part of the problem I think because everyone's always going on about you can just do things you should just do things well I'm just doing things and people are get are getting annoyed at me for doing things or having their like uh you know having their opinion on things and I and I do realize that when it comes to like graphic design it can be incredibly subjective and really you probably shouldn't be asking a wide set of people their opinions on U different kind of graphic design things it should be more targeted so maybe my bad there but generally

people just get so like I don't I know just get so aggressive about these things it's literally like a fun little project that I worked on with some people it's it's it's a choice between three different logos guys it's not some huge thing that's going to make or break ethereum I don't know people took this so seriously making it out as if it was so much bigger than what it is uh I don't know anyway I don't want to rant too much about this but it kind of annoyed me to be honest right it just kind of annoyed me to read all the comments when I woke up because I woke up to this of course uh and just be like guys like why are they you taking it so seriously like go Focus your energy somewhere else or at least go do something if you're if you're this

passionate about graphic design right so anyway enough ranting about that that was just some clarity for you guys out there I am still working on the powered by ethereum designs here honestly we're probably just going to release what we've got and release the um the figma files and people can just iterate on them if they want we'll have a web page up for it people can go download it do whatever they want with it uh the really the whole thing is just to get this on Project websites to make sure that people know that the the project or the app that they're interacting with is powered by ethereum all right so Mega eth has announced the essentially what is their Ico so this was announced I think a couple of hours ago so I'm still digesting it myself and I'm digesting everyone's comments around this but

they're doing this in a similar way to how infinex did it with nft so they're going to be doing this nft collection called the fluffle so there's going to be 10,000 soulbound nfts that represent meaningful ownership in the mega eth Network I believe they're allocating 5% of the token Supply towards this and they whitelisted around 880,000 addresses to Mint these nfts the sale happens in a week it's one eth per nft if you want to Mint it here um I don't know what the limit is I think you only get maybe one nft per whitelisted address that you have so I think the demand for this is going to be through through the roof of course I should disclose here that I invested in one of Mega eat's private funding rounds a while back I I am Whit listed for this

as well so I do plan on sassle E so I do plan to participate if I can as I said there's not enough nfts to go around so I don't know what it's going to be like in terms of bidding wars if this is on mainnet you're going to see mainnet gas Spike to some ridiculous level um but yeah this is this is basically an Ico that they're doing here which I love as you guys know I've been a really really big fan of projects doing more public kind of nft sales or token sales uh for for their projects here infinex did it with the patron nft there's been more projects doing it on places like Echo uh and Legion which aren't I guess like public so to speak but they are open to a lot more investors than uh than uh than than most other things but my real

kind of hope is that most of the ecosystem gets back to doing icos like this and that brings me to the other thing I wanted to talk about which was some of the reactions I saw to this people were getting upset and saying wow like you you're charging one e per nft this is ridiculous uh you know it's a really high price how is anyone going to expect to get any return from this and I looked at that and then I and then I looked at the fact that effectively what your buying here is as I said tokens you know the nfts is just like a representation of those tokens and it's at a $550 million ful fully diluted value for one of the I guess most hyped up projects in the ethereum ecosystem which which is Mega E and and obviously honestly in the crypto ecosystem

generally here so I don't understand why people have an issue with this like do you know how many VCS would fall over themselves to get into Mega E at a $550 million fully diluted valuation like comp that to the other l2s out there that have multi-billion dollar valuations guys and as I said Mega eth has a lot of hype behind it and I'm not trying to pump my own bags here cuz as as I disclosed before I am an investor in mega eth but I just felt that the replies to this were just utterly bizarre like everyone wants access to these things they don't want VC's getting the whole thing and then Mega eth comes along and says hey we're going to give you access we're going to give make it more public we're going to and they did they didn't an echo around as

well mind you um but you know they're like we're going to make it more public we're going to let more people get involved and then the first reaction is that oh you guys are charging too much for these nfts this is this is crazy you know that's a high valuation it's like it's not though like you got to you got to contextualize these things so I think that because we haven't had icos for so long the newer people that got in like even after I guess you could say 20 2019 I would say anyone who got got in after 2019 does not remember what icos were really like it does not remember how people were going absolutely bananas for icos they loved it and and yes a lot of them were scams a lot of them went nowhere but that is actually true of a

lot of uh just VC investing generally they may not necessarily be like straight up scams but a lot of them go nowhere guys like most of the projects end up either returning the money to investors or burning through all their money and just shutting down it's not a very like high success rate if you invest in 100 companies as a VC or 100 companies or 100 projects as a um as an angel investor for example you're rate there is going to be quite low you're just hoping that the ones that do hit hit hard and they make up for the the rest of everything else that's essentially what the Playbook is here so there's no guarantee you're going to get any Returns on anything but the fact that you can get into Mega eth at a $550 million fully valuation when the comp

for similar kind of uh I guess like things like other l2s out there or multi-billion dollar valuations I don't know that seems like a no-brainer to me as I said I am going to participate in this nft sale if I can I am going to buy one of these nfts even though I'm already invested as an angel I want more exposure to Mega E I think that they're going to be a really big deal I've been bullish on them since day one I think they're going to do wonders for the ethereum L2 ecosystem especially and the etherum ecosystem generally so I'm going to participate in it but yeah I just thought it was a bit bizarre to see people complaining especially when people have been asking for this like they're asking for more public sales they're asking to be led into these rounds um and I don't think people

realize that that the the later round the later rounds for these um things especially for l2s and l1s they are normally done at multi-billion valuations I actually participated in the um optimism round uh this was a while ago now I think it was like 2 to 3 years ago and it was at a $ 1.5 billion valuation I believe um and and and they had so much interest at that valuation this was years ago before l2s were as hot as they are today so you you really need to keep in mind that the latter stages the latter I guess like raises before these l2s go live are definitely done at multi-billion doll valuation so get being able to get in at at 550 million fully duded is a uh pretty big deal I think but anyway as I said not trying to sh my bags just want to

contextualize things for people so that they understand what is a good deal versus what is a bad deal and again this does not guarantee you're going to make any money here I'm not saying buy it because you're going to make a 10x or anything like that please don't read into that uh I'm not even telling you to buy it like it's up to you if you want to buy it or not but I am bullish on them and I am bullish on a lot of other projects in crypto as well whether I'm invested in in it or not but I'm really excited to see how we continue to evolve the icos in the ecosystem these public token sales as I said the infinex pioneered it with the patron nfts you got Mega E doing it now there are other projects that have been doing this as

well uh that have been you know a bit smaller but they are doing it uh and I hope to see more projects doing this uh as time goes on all right last up here the zkp 2p version 2 has been released so I remember I highlighted ZK P2P a little while ago a bunch of people that I used to work with at set protocol are building this and they've been building it for for a little while now but just to give you a refresher on what this is it's basically a trust minimized way to on and off ramp uh via P2P into and out of crypto uh and this is settled on base of course on the on the Bas L2 here so you can see here that uh you can onramp to usdc eth or CBBC and more across any chain using venmo cash app wise or

revolute no fees no extra ID checks and in under 60 seconds and they have a video here of what that looks like so essentially you select your token on your chain that you want uh you can send in Fiat so in this case they're sending in 15 USD they're signing a transaction uh you basically send it uh through your venmo you can see here in the video I'm just skipping through the video but you can watch it I'll link it in the YouTube description below and then it verifies uh your payment using ZK proofs completes the order and all done in less than 60 seconds so you get a nice little onboarding experience there what I see this being really good for because there's obviously like very kind of um harsh limits on these things there you can't do like tens of thousands of dollars of onboarding I don't even know

what the limit is right now but I I think it's only maybe a few hundred but what this is really good for is essentially topping up your account with uh money if you need to pay for gas fees for example so let's just say you're on uh base right now and uh you don't have any eth you only got usdc there are yes there are other services that you can use to do to to pay the fees in usdc which just gets kind of abstracted away in the background but there's usually pretty high fees on that honestly at this point in time um and it's usually done through a third part a third party service provider that uh you may or may not uh you know trust or you may or may not be integrated with as part of your I guess transaction flow whereas something

like this what you can do is just top up your account essentially with with uh with ZK P2P do it in a trust minimized way and and you don't need to do much you can send like $10 not even you can send less than that of of of money into this to get the gas that you need and then you can go uh and be on your Merry way from there which I thought uh was was a pretty cool use case there but there are also tons of other use cases here such as doing uh peer-to-peer payments right paying someone and if they say hey just pay me in crypto you're like damn I don't have crypto right now but hey what I can do is I can use ZK P2P just give me uh your address here uh and then it's all settled on

chain for them and they can access it there so really cool to see V2 of ZK pgp go live you can go check it out for yourself I'll link it in the YouTube description below but I think that's going to be it for today so thank everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe to newsletter join the Discord Channel and I'll catch you all on Friday thanks everyone