GENERALIZED ABSTRACTION with Anthony of XION

Transcript

welcome to the interrupt today my guest is Anthony he's a core contributor at Zion they a generalized abstraction layer one in today's conversation we'll discuss Zion's origin story and why they burnt a bank SE we'll talk about barriers to crypto adoption and how their meta accounts is making it easier for new users to on board we'll discuss how Zion enables signature abstraction and Fe grants for applications we'll talk about their unique approach to offsetting inflation and why they're so bullish on the cosmos stack I'm also dying to find out why he thinks no one gives a [ __ ] about crypto before we get started make sure to subscribe to get notified when new episodes drop every week remember none of what we discussed

here on the interop is investment advice and if you enjoy this content please consider sticking with us we're validating on OS Quicksilver osmosis and Juno just look for interop in the active set my guest Anthony is coming up right here on the interupt [Music] I'm here with Anthony core contributor at Zion hey Anthony thanks for joining me what's going on Seb how you doing good yeah first podcast of the year thanks for coming through on this of course very short notice too you're like hey you want to do this tomorrow I'm

like honestly yeah let's do it that's usually how things happen uh I'll I'll I'll wake up on Wednesday and be like I got to do a podcast tomorrow on Thursday CU I usually released by the end of the week and uh and then I'll just reach out to a bunch of people and you know it always works out and it's been working out this way for years so and why stop it if it's if it's working yeah exactly you know I also Host this other this other podcast called epicenter and we've been doing it for 10 years and like for the last 10 years we were just like constantly trying to keep up and like you know we'll get three or four weeks ahead we're like oh we're good we're like three or four weeks ahead and then and then something happen wake up on a

Tuesday and like I got a post exactly and there's nothing and then you just like start calling all your friends but anyways uh that's not what we're here to talk about um so we are here to discuss burnt uh Zion which um you know was kind of off my radar like I I hadn't really heard of this project until uh Zex from Stak lab mentioned it and put us in touch and I was like what is this like what's this project with like 170,000 followers on Twitter and like just as many people on Discord that I I've never heard of and started looking into it and um and so yeah I wanted to kind of Deep dive uh here today and understand what it is you're building but before that

I'd like to talk a little bit about the origin story um y why did you burn a Banky it's a good origin story though right um so back okay so this was this was almost like three years ago now we you know as as you mentioned right we bought a bank CR piece for those who don't know we bought a bank CR piece for $90,000 and we lit it on fire we sold it for $400,000 as an nft on openc um the reason we did this right and this is like this is back in the day right there was no one was the only real nfts like crypto kitties and crypto punks that was kind of it um this is before be before really like a lot of things um but I love them I I love my crypto kitties um you know and I think as it kind of came

to the vision of nft I think we definitely saw very early on which was you know this digital ownership of digital art which could never really be done before on like the cess pool that is the internet um you know so but I was always getting [ __ ] for it I hope I can curse on this podcast um I was getting a lot of [ __ ] for it was just like you know this isn't real art it's still what you hear today but it's like this isn't real art um you know if it's not on my wall if I can't touch it if I can't see it you know where's the value in it so I'm like okay you know let me take something that has value sold it aside the auction right people know the word Banksy and you know even even the art

piece called morons was like making fun of sou the Beast auctions and people buying art so I said let's slide it on fire right obviously you got to do something cool um and see if the value holds um if we sell it as an nft and like from my perspective we didn't even think we'd make any money on this like we thought $10,000 like we bought it for 90 we were thinking like $10,000 was like what we were going to get for this just because that was the price of nft at that point like the highest nft ever sold was I think it was like $100,000 which is unheard of um and it worked right I mean I think a lot of us was just trying to you know and you'll kind of see this as a consistent theme which is taking this bridge between retail and

crypto right and saying we know this works in crypto because we've seen it in this micro environment but you know and I like to piss people off too it's it's pretty fun um so I I like to do these kind of stunts and these big ways to make these kind of points known um so we burned it to prove a point and we proved that point yeah I mean this was like during you know nft summer like I guess 20 before okay this was before and so then um you guys built this nft platform on salana uh like building some of the early nft standards there what uh what came of that like what did you achieve there and kind of what came of that project yeah and I think we'll get into this more when we start talking about

Zion but a lot of the logic was it was miserable for us to do the nft right like we had to you know I and I've been in crypto for for quite some time and with three of us two of them were from injective and none of us really knew how to Min an nft uh it was just not something that we really did um you know so we had to work with someone else who helped us mint an nft and it was you know this this whole promise of you know let's let's democratize ownership but if not everyone can access it then is it really kind of democratizing ownership right and we wanted it to be like you know hey everyone can be an artist everyone can do this we can be discovered globally and and really kind of fulfill those promises of crypto but

what we kind of saw was this infrastructure that was slow expensive really hard to operate in and you know we wanted at that point to make a very specific version of it right which was the marketplace right decentralized Marketplace people couldn't get front run it was cheaper right it was salon at the time it was faster um as one of our bids kind of effectively got front run um on the Banksy auction you know and and I think as we kind of migrated from there and we built some of the early standards there like the first collection standard Etc um you know we still were working with people like Afrojack and some pretty big names of trying to get a lot of nfts on on the platform but the process of doing so is still you had to go to coinbase you had

to get a phantom wallet you know I'm sure I don't have to really tell you why crypto experience is just so miserable right and we'll of course get into that because that's effectively what we needed to solve it Zion right um and the journey to Zion started I would say I think it was June 2022 um was really when we first really broke ground with the SDK right and we said we need to hit this from the ground level you know as I mentioned like no one gives a [ __ ] about crypto right and I think we can kind of go into this a lot more but we really wanted to build this blockchain for Consumer applications with the the underlying thesis that no one should care about crypto and but we still need to provide the benefits that crypto

promises I I'd like to maybe dig there's a lot there I'm sorry yeah but like you said that like no you think that nobody gives a [ __ ] about crypto and to some extent I agree I I think uh nobody should give a [ __ ] about crypto infrastructure in the same way that nobody should give a [ __ ] about you know AWS or EXA any other sort of like technology unless they're building on it uh but but it seems that a lot of people do care about crypto currencies and and do hold cryptocurrencies right I think there was uh I saw something recently that says that like something like half a billion or close to half a billion people hold crypto in one way or another yeah and you know when we say that we're still early I think that that's the best

indicator of how early we are because that's about how many people were on the internet in like the late ' 90s uh around the world MH and and things sort of picked up from there and it wasn't actually until like the iPhone uh that we had sort of like half of the world's population on the internet and that was 10 years later so or yeah but I mean I do have an issue with that I do and I'll and I'll I'll pick on that point a little bit but to be on the internet required a serious investment in in infrastructure right like it was really hard to be an early internet user right now people have computers they have all the tools that are necessary and we're mimicking the adoption curves of internet I don't see that actually as a positive I genuinely see that as a

negative especially as you know narratives like AI surpass us and and you know narratives like VR surpasses and obviously they've been around for longer but it's it's not for a lack of tooling right like why is VR taking off when you require even more investment than crypto I mean I think the answer there lies in just the importance and the influence of money I think you know this this has been obvious to me since you know since I start first started getting interested in Bitcoin like 10 years ago is that this was going to take a long time because crypto fundamentally is a political um is a is a political idea uh more so than you know the spread of information um using using the

internet or like the ability to I mean AI is fairly political but like VR and metaverse you know is just like another distraction not a lot of politics there it's entertainment it's gaming right it's gaming at the end of exactly and and I think like money and and finance is highly political and so that's why I think it's harder for crypto to uh like crypto has a whole lot more barriers that has to break down um whether you know um uh whether ideological barriers like the sort of ideas that like that people hold about crypto I think in your white paper you said like you you serveed people and like most people still think that crypto is a scam y um but you know in the early 90s like in the early 2000s a lot of people still thought the internet was

stupid right like there's tons of articles that like people writing about how the internet was how it'll never be yeah of course there's too much information yeah correct so I mean this is like um this is a recurring thing you know I it goes back to the printing press when people thought that like people having books was a bad idea um so I I I think that I think I'm I'm pretty I guess I'm not so um worried about the adoption curve obviously it'd be better if it was if there was more adoption but I think the adoption curve is like on track okay I don't know it's a good point yeah Ian podcast argue

otherwise yeah no I mean listen I I think it's we're both arguing for the same thing I'm saying it should be faster you're saying it should be faster right and I think anyone in crypto is not going to say you know what actually we're good having one like one% of the population I don't think anyone here wants that right and you know I have I come to the the table with a set of beliefs that you know and I think it's funny because crypto as a whole was meant to eliminate the need for trust yet it became very quickly one of the most untrusted Industries um which I mean to me is hilarious right but you get something that's you know you're redefining ownership right and and I think it's a sect of the internet naturally right where you have so much information in this kind of

postmodernism like argument of there's too much information how do I know what's real I think crypto thrives you know you've never been able to do scarcity on the internet which is why the whole right click save is such a meme um you know but it's not going to be like killing the Netflix's or the Spotify it's going to be this kind of upgraded or or completely new thing which is so exciting I agree there so yeah what's so what is Zion and who are you building it for yeah that's a that's a great question I would say that Zion takes on the The Narrative of a couple things on a very Bas layer and if you would have asked me directly it is an L1 for Consumer applications um you know we can get into the word of generalized abstraction which is more technical

right and and speaks to that more technical um you know kind of audience but when we talk about an L1 for Consumer applications right what we really mean is the current tools right now are really tailored towards the Crypton native it's really tailored towards defi it's really tailored towards finance and you know this this group that's been in here and and this call it an echo chamber right where you have these extremely high barriers to entry both you know physical and kind of a knowledge barrier to entry um where we require people to click on on the right links download The Right extensions and learn about this and you know wait 5 days enter your social security number on coinbase and there's a lot of expectations right but you know it's also more incentivized by the industry

to kind of be siloed in a way because you know a lot of protocols a lot of protocols business model is effectively um you know not rugging retail but bringing new money in so that people can cash out right and that's a pyamid scheme uh at the end of the day yeah so when when you say building uh like you're building a layer one for for Consumer applications yeah you know I think there's a lot of other Pro protocols that would have a similar um Mission I think Saga say immutable injective like all of these chains and some others you know we're built around this idea that we need to make applications easier to use faster

with um better response times like better ux around wallet yeah um and you know Al also like osmosis I think you know even though it is quite defi oriented is like super focused on ux and uh improving the experience yeah how is ion different from any of those yeah I mean I'll think about the names you mentioned right like injective is a blockchain for finance say is the blockchain for trading um you know Saga is um I don't know their tagline but I believe they're like roll up of f-ups is what I always called them or a bunch of side chains um you know but I love that we were part of the uh the uh one of the programs I forget what it was called um you know and then immutable gaming right and I think everyone's going to have their Niche and I think there's this is something that

we learned early on in Solano was when we were competing with D5 products you know we were there's different things that be needed for a generalist blockchain and I think when we look at something like Cosmos you see where this app chain industry chain specific narrative comes in where when we talk about consumer applications a lot of it is we know like we don't want people to give a [ __ ] about D5 we want to make the next Spotify but make it just about the music music we don't we don't believe people should care about that you know and when you you you had mentioned it earlier which is making a better ux for wallets you know we we kind of go into this when we start talking about what we consider meta accounts which is we don't really want EAS right we want smart

contract accounts and we want you know what we call it is you know we enshrine our ux opinions on the protocol level right which is rather than something like a 4337 which is kind of this social consensus layer or you know this kind of social consensus we have it on the protocol level which allows us to do a lot of interesting aspects to it right rather than kind of really fragmenting the industry and making it extremely difficult we just make it extremely easy for someone who wants to build um I I love music um but so I'm going to keep giving music examples because you know but like the next SoundCloud right and so that they can focus on the product interesting so um you know there's a lot of different ways we could we could uh

sort of get into this but let's let's maybe start with generalized abstraction because this is a topic that it's obviously like in your tagline and sort of everywhere you guys wrot a paper about it and so what what is generalized exra abstraction and how does that relate to Zion yeah I mean I think it's it's you know not necessarily a play on words but it's definitely kind of comes from the the idea of uh you know account abstraction right and I think when we were having these conversations about abstraction I think it was what people kind of understood as this Universal hey let's not let let's make sure that users can use this without really needing to know everything right and so whether it's a concept of the tokens that you buy underlying whether it's a concept of the chain you're on whether it's a

concept of your account of your of your funds you know it should feel like a web to experience and we believe that our main goal is to create a web to experience on every single application that's deploying on Zion and the way that we do that is by creating this generalized substraction layer to kind of make this separation between this product and you know let's say um like execution environment right is Zion this I think this is where I I need to get a better G and it's hard because of how much jargon there is in the industry of like and predisposition of what an L1 is or a layer is or a blockchain is um so I think it's easiest to understand it as an L1 but it's a kind of collaborative L1 via the shed interoperability like I

I think the main goal of it is to look like the app store right whether you're on you know whether you're on Zion whether you're on injective whether you're on Avalanche whether you're on optimism it shouldn't matter right and I think we're getting to a place especially when we can have a smart contract address on every single chain we can then effectively you know Bridge or communicate via General message passaging or however you know I think we we we site I think we cite exos uh hyperlane and IBC for how we kind of do this but you know taking the the concept of interchain accounts and then bringing that you know everywhere via let's say Landslide or uh something like that you kind of get this interesting aspect where hey the chain doesn't matter you know everything for us we had a pretty

big partnership with circle is going to be dollar denominated right and we kind of talk about our parameterized fee layer which allows you to not only use usdc but allows you to use any token you want on any chain which makes it significantly easier for us to you know for us to operate on every chain you know and the reason we have it as kind of this independent layers is to you know obviously we have the validators incentivizing security and ensuring that everything is kind of up to up to Snuff if that makes sense okay so when when a user is interacting well I I I guess I I mean first and foremost Zion is a developer product right I mean like it is for developers to build applications corre

so how does zion like integrate with other chains I mean just does does zion sort of as a developer am I building on Zion and then like Zion is somehow deploying or interacting with other chains or um or is it sort of like the other way like what's the kind of like modular how does that look in the modular stack yeah no that makes a lot of sense yeah and there's definitely a a component of time in that right and I think to answer the Grand Vision And to answer what we're doing in two months is going to be very different right you know we obviously are running a test net right now uh well I guess uh kind of just close to test net uh opening up a new one soon though deploying on Zion you kind of get all these aspects of uh

you know General abstraction we're working very closely with the injective team to try to do that for something like Talis or Mido to be able to use his ion account on Mido um you know and then as we you know as I mentioned with Landslide it's a lot of kind of a a lot of really Reliance on IA to have these mirroring accounts on every chain um you know and so I wouldn't think about it as like Deploy on Zion and get deployed everywhere it's the Zion user experience is pretty chain agnostic right you could be we are collaborative with injective we want to be collaborative with optimism we want to be collaborative with avac because I think especially as an L1 and where we are in the industry it doesn't it doesn't benefit anyone to

be competitive a user on Shana shouldn't like not be a user on Avalanche you know and I think this is one of those fundamental understandings that we learned very early on which was you know when we want to we call it abstracted into operability and a lot of that is like it's marketing right the abstracted interoperability is marketing what we really want to say is you know we we want to create this environment where the products are the thing that Thrive and we want to you know kind of not hide but in the back end you know when I say people don't give a [ __ ] about crypto you know the the process of moving to another chain swapping your funds getting a new denominated token that's also extremely volatile you know if we really want to get retail on board they're not going to

do that right like it's still it's still ridiculous as it is today to kind of oh here's a new L1 let me bring it over to scroll and do X Y and Z and then I have to go bridge that over to optimism and change that to optimism like it's just it's terrible and so when we talk about it it's it's pretty umbrella of a term and you know I think there's going to be a lot of writing and a lot of kind of conversations that come out of it but I do think that we are stunted by the traditional definitions of an L1 I was thinking about this in in the context of different uh application environments whether you know so like this could work on for like applications on ethereum or some other generalized like smart contract platform could also work with

applications built as rollups yes and and and applications built as app chains in the context of app chains though um so let's say like osmosis or or dydx right like they have a high level of sovereignty and I think like they are building an application that um has a high degree of like vertical integration and want to keep their users like on their application and you know in the case of Osmosis they're building also like account abstraction to make it easier for people to onboard Etc so you know is there is there a benefit for applications like those that have such high control over the entire stack that can build things like generalized sort of like account abstraction and fee grants and things of that nature like built into their chain is there an

advantage for them to use Zion as well yeah I mean we're not I mean we're not taking over their chain right and I think that's why we call it you know this kind of abstraction layer right and why we're going to be collaborative with every chain is because now rather than saying oh I have 10 10 users on this chain 10 users on this chain you know and on on 10 different chains you make that all collaborative now you have a 100 Universal users on 10 different on like 10 different products right and so it's it's a rising Tides will bring all boats you know will bring all boats up approach rather than you know and and that's I think a big issue that we kind of have which is you know this it's we're competitive right like the the crypto industry especially the L1

industry is extremely Cutthroat and it's competitive a user on dydx is Silo like they don't want to go to osmosis like dydx wouldn't want you to go to osmosis maybe they would I could I don't want to put words in their mouth but it would be much better if we had everyone just being able to use the products as they they're kind of designed for and like we're not trying to take over their stack we're just trying to create this layer kind of on top that allows for everything to be connected so the to add to that the the transactions and everything would still happen on their chain but they would be mimicked on this ion chain okay so let's talk about some of the different components of this generalized abstraction so you know there's uh

there's the meta accounts there's a signature abstraction you have this parameterized SP layer and this abstracted interop ability um you know these are all kind of very abstract uh terms I think so let's maybe talk about one uh each individually um starting with maybe the most obvious which is the meta accounts or I guess you could sort of equate them to some kind of account abstraction um how does that work yeah loaded question um but yeah so I I think when we talk about meta counts there's history behind that kind of connotation to it right which is I think you get this kind of idea of account abstraction

in 4337 which is hey let's make an easier wallet right like let's make let's make this wallet with these bundlers right Etc when we have it on the protocol level right and we have everything that we've kind of been working on meta accounts is is more of an application of what we've built right and so when we say since we're you know since everything's a smart contract to cut on the protocol we get the ability to sign in with really whatever you want right there's no private public key anymore and I think that that concept is what I'm going to harp on a lot when I talk about a meta account right so since we don't have a private public key anymore right we just we effectively just have a public key that needs to be authenticated we can use any

authentication method we want which means that we can use you know a salana wallet we can use an ethereum wallet we can use a Kepler we can use face ID we can use single sign on uh Gmail socials whatever any public you know any any encryption works right and so that's kind of one of these things and I think we talk about mobile as well right and a lot of decisions in crypto are based on these Legacy decisions that have been created for us right the reason a a a wallet exists is because you needed someplace to store the private key right you're not going to just store it in the browser you need someone to store it for you right so then comes metamask and then comes this entire protocol design around this concept of wallets which

inherently is clunky you know you lose a mic you're done right you're compromise once you're done you don't really get this security aspect you don't you know and there's a lot you know I of course don't really have to kind of say too much on that but the ability to then have everything as a meta account and have just complete public key encryption right is it allows for us to do a lot of insane things right and as I kind of mentioned with one of those things kind of being what looks like a account abstraction but being able to do key rotation really getting into the advanced nitty-gritty of being able to do like even weighted or or being able to and I I think the way that we're working on it with abstraction 2.0 is using um offz to provide kind of

security grants right so you have this kind of you know you have this meta account and then say I want to go to use this application I can give an AZ Grant to then spend only up to $50 on the accounts that on the contracts that I permissioned and you get this new layer of security that kind of also works with that and you know you've obviously been around in the cosmo space a lot and you've heard odzi being kind of mentioned in this connotation and I think you know there's very few podcasts where I can kind of go into the nitty-gritty on why we're excited about what we call abstraction 2.0 it's a mpm library but you know a lot of that kind of comes over to this OD Z thing that we've done to be able to have these sub accounts per each application that

you're on that link to the meta account and have this security permission but at the end of the day it just feels like you're you're dealing with products um yeah I mean obviously like oy works when you're dealing with Cosmos Chains It's you know when when you get into you know salana or ethereum or any other sort of and a lot of that diff right like we we again we site hyperland you know I think there's going to be different methods that we do I think for us we're not you know obviously right now we're Cosmos right and IBC and I is already there and it's so incredible and it's honestly it's frankly underused that should have been my hot take because I genuinely think that it's the killer thing of Cosmos um that is just terrifically underused uh or

underutilized or under talked about but um yeah one thing I I wanted to ask you is with this with this um abstraction 2.0 if we don't need a place his stort of private key anymore I.E a wallet and you we can we can construct these you know uh kind of multiactor authentication um perhaps also and this is something that osmosis wants to do right is like having thresholds so if you're sending like under a certain amount you can sign in with your Gmail but if you're sending more you're going to have to have a second Factor perhaps of a pass key or something like that um at this when you get to this level of account exraction and the private key no

longer exists do we need a wallet anymore like can we just like log it in the browser and have everything just happen so that's why that's where you get into o z and so this is actually funny because we we realize this with with abstraction 1.0 needing abstraction 2.0 on osmosis that works when you're osmosis and you know that you're not going to be a malicious application when you're building out an ecosystem and you effectively give free reign to someone because you don't need a wallet any anymore that can get really bad really really quickly right and so when we talk about this kind of security threshold of odd Z yes there's like this multiactor authentication of um you know of like osmosis but still osmosis right what's

interesting kind of about that right is when you say that there's no wallet what you need to understand is that there's no real signing anymore right is because now it's like signal right where you log into signal you verify your session and then you could send a bunch of messages as you want right since there's no private key you don't really need to sign anything anymore um which is both really cool but also pretty scary if it's in the wrong hands and so when you talk about these these kind of Grants right it's yes we want to we want to ensure that this session is valid we want to ensure that you can only get up to this much interact with these contracts that are you know maybe government governance approved um you know but a lot of that does come into you know yes our aspect

of still wanting to bring retail on but understanding that we still need to be trustless and decentralized okay I hadn't considered that yeah B basically if you give access to the browser or like some application in the browser that application once it has access it can just like whatever it wants do whatever it wants and yeah okay um or or potentially even like you could have some exploit that is like you f has has has control over your Dom and would be able to then like um make transactions on your behalf and so that so so in this case that's where RZ comes uh into play is that Oz sits between the user and the application so you can set all these parameters within ozi it's

like a sub account and it's you're not connected to the entire you know entire thing right if you're on a social media or social network right there's no reason for you to be sending $50,000 to a to a wallet address you know the the approvals you're going to give are going to be like a post comment on something like don't expose your entire wallet balance yeah and so like I think one of the challenges here with with this kind of I mean with with any sort of new account system is that uh Legacy accounts are are diff difficult to onboard so like I I use a ledger uh you know I'd love to move all of my D5 positions onto something that's easier

to use and yet secure but so kind of I mean there's there's also what we want and what we don't want right I'm not promoting anyone to get off of their Ledger like that's not what we want I think I'm still keeping a ledger right yeah but like think about like a long-term business right I mean if if if you're like 10 years from now like we have a account abstraction that is you well constructed enough where you can have Hardware you can you can have Hardware that's maybe like in a phone or something like that that's that's also Security in the device and maybe like multiple Factor layers of uh multiactor authentication for different types of you know and then you want to onboard folks that already have yes you know sort of like very complex portfolios that are on eoas what's the path to

taking those and migrating them yeah to uh something like this so there's there's two kind of things to that one of them we have we're really bad um because we just do way too many [ __ ] puns at this company where we have like I don't know if you've seen abstraxion which is the the mpm library but it's abstraction spelled Zion at the end right and then you realize that anything that ends in like o or I can then just be e owned or whatever um we have what we call succession or whatever it's annoying I know don't blame me blame Ash but um uh what we still need require you know there's going to be times where you still require offchain signing right and you know a lot of this kind of comes into play which is like hey I exist I am

this wallet right and as I had mentioned right since it's a public key we can use any encryption method right which means I can still sign with a with my metamask I can still sign with you know a yub Kei or something like that right and being able to kind of trans for that can still Bridge right and I think that's the difficulty in what we're kind of building is yes we're building for the web 2 but we also building for the web 3 because at the end of the day that's where everything starts right you can't R wasn't built in a day and you know being able to I mean being able to transfer is very easy it's just a bridge right I mean I'll call Geo maxela right now and be like you know but it's it's it's being able to then bring that into

this kind of secure method in a way that both resonates with web 2 and web 3 right and so when I say I don't want anyone to move off of a of a hardware wallet I'm still very a huge proponent of not your keys not your wallet right and I want to create an environment I think the whole team does wants to create an environment where you know if you don't want if you still want to operate with your ethereum right if you still want to operate with your salana you can right like we're not saying you can't you know I think a lot of that kind of needs to be you know and and a lot of that is like very it's design right which is having advanced settings right maybe maybe not not necessarily saying this is the correct approach but saying hey we think you should use your

email do you have a a a Kepler sure here you go right um so and I think that's really important about being this kind of environment that we want to create is it's not just for web too it's it's this nice bridge in a way so that let's let's talk a little bit about signature abstraction and how that relates to this is perfect yeah yeah account extraction yeah right so you know as we kind of mentioned right we don't we it doesn't the signatures don't matter right anymore we don't need we don't need a signature uh you know we don't need to sign transactions we do need to validate a session right but that means we can use any encryption curve that we want right whether that's you know we can and then combine them

together right and I think you look at like what multiactor authentication will look like on this it's we'd love for people to use their email to create an account but then back it up with a metamask right or join join Zion with their metamask and then use your email for account recovery right do they want to switch out a key great here's another one we can have key rotation on that that key can be you can like and we're going to have right and then that goes the other way around right which is being able to use those keys to then sign transactions on other accounts um or to mimic the transactions on other accounts um you know and I think what we talk about with signature abstraction it's a cute marketing word right but at the end of the day at the end of the day

most of these things are right it's it's signature abstraction it's a it's device abstraction but the only thing that really you know at the end of the day this commonality between all of them is that people don't give a [ __ ] but people shouldn't have to know what what signature curve they're using right or understand what why you know K1 versus R1 curve right they think we're at a point of encryption where a people don't even know right but also we need to be we need to ensure that we're future proofing for the next generation of encryption services that kind of come out there right and so as we talk about you know the R1 or K1 curve that could be obsolete in 15 years right and to be

able to run an entire you know to run an entire network off of something that could be obsolete you know we need a way to then kind of prevent that and effectively future proof oursel for you know maybe another chain Comes live that uses a completely different signature curve or some other method of encryption we need to be ready for okay so so if I summarize here um like an application that uh leverages like Zion extraction like a a user would send a message to Zion to do some action and then Zion has the ability to sign on any sort of with any sort of curve yeah that's that's sort of the way I understand it like so basically you can like sign with um well Zion's not signing technically but you

you can sign with any curve to Z okay I see right okay and then and then Zion passes on that signature to there the to the chain okay got it and um how does this relat how does this relate to like Pass Key technology yeah that's what we're really excited about right because we can use apple secure Enclave now right which means that you can log in with your face ID you can log in with your Touch ID on Mac right or your Google ID or something like that and utilizing apple or Google secure onclave you know is extremely cool um you know and so when we talk about Pass Key we just want to make this as web to as possible Right like imagine logging into

your account just with your face ID and you don't have to sign anything because you've already authenticated your session right and you know at the end of the day like we keep reverting back to this idea that we want to like we work so freaking hard just to mimic web to right and to provide applications that can mimic at web to so that you don't you know I think immutable even quoted this of like there's a 95 % fall off rate when users are prompted with a wallet right and let alone just even getting past that right and so being able to provide companies you know products people the opportunity to build products that don't provide a 95% fallof rate is is really what everything here is for do do you think that as we move towards as as people move towards

leveraging Pas key to manage their entire digital security does that give Apple too much power to Apple and Google and one of the ways that we can as users like retain sovereignty over I mean I guess like they can't I guess they don't have access to the keys because they're encrypted in the device but but they do have like the ability to censor I suppose we also don't want your pass key to be your only means of authentication because yeah I mean I guess this more like a general question about the use of pasy for you know securing one's like Vault of passwords you know I mean that's why Bitcoin used the you know the K1 curve versus the R1 curve right which is the the the kind of fear

that a it's already been encrypted right but this kind of fear of power right and that that's where all this kind of comes from so on a general basis yeah I absolutely agree with you right but you know I I think on on two kind of points to that number one being this kind of concept of key rotation which is you know this consideration of like multi-party computation is is kind of interesting um you know but being able to not have this kind of single point of failure single point of exposure is number one really really important to us um but then also I I think it's like you know you're always going to find this tradeoff of adoption versus hey does Apple too have too much power right or does Google have too much power because

when we talk about usus and I know us right like we're very specific of like yeah apple has too much power um to what crypto here for but if we want to genuinely bring over the world there's going to be some trade-offs in security for for the people who maybe they don't care about security right but you know being able to them provide them like a multi-party or like a multiple key rotation uh system where they don't need to care is kind of what we approach if that makes sense it's the old bait and switch you know what I mean yeah yeah um so so what's the what's this parameterized fee layer and uh how can applications utilize that to um abstract away fees so I mean parameterized fee layer we we

kind of go into this in a couple ways and I and I think you nailed it as well right which is number one people shouldn't ever I don't think an end user should ever see a gas fee in their life I don't think it's conducive and especially when you have to buy like a native token I think that is a huge barrier of entry for number one products but number two kind of l1s and so we understood that there's an insane amount of friction that comes with gas and so for us that part was originally called gas abstraction if you could follow the pattern there but you know as it kind of relates to the parameterized fee layer there's definitely more to it and you know we work with uh you know fee abstraction is is an interesting part of that which is there's two types of

transactions that we kind of imagine the first one is paid transactions right which is I'm sending you know I'm buying something for $100 and everything is denominated ideally in dollars right I'm giving $100 also since it's denominating dollars that allows us to have credit card purchasing directly for those assets right because you don't have to do this weird rigamaroo of of swapping right so buying usdc with assets uh buying credit card using credit card buying usdc buying the asset with with the credit card you know and then say hey here's you know 99.99 goes to the person who sold it and then the 0.1 then goes to the fee collector right this is one of those

things that we built right and so that that those usdc fees then get swapped to the Zion token so that they can be obviously counted against inflation the second is what you've probably seen more which is this kind of concept of fee sponsoring which isn't as sexy it's not as cool but this is more for like the platform sends Etc things that are that don't really have a monetary value to it but still need to kind of go across the Finish Line um but a lot of the fayer kind of comes along you know and we use uh you know we work very closely with osmosis for the fee abstraction kind of on that end and you know there's a little bit a part of it about like how we calculate the t- WAP to be able to pay the the the gas collector or the Fe

collector to then combat inflation but at the end of the day the whole reason that that exists is so you know starting with usdc but then whether that be Zion whether it converts to Zion whether it converts to salana and then does a transaction over there it it creates this kind of it creates this separation this abstraction layer uh um between this kind of the the product the user and then you know what I call the people who need to be fed right which are the validators which is getting the the transaction across the finish line and making sure that everything is accounted for is this complimentary to using skip Lanes um for fee abstraction um I think we work with the same I believe I'm you know

unfortunately I I'm not as familiar with a skip plane can you give me a a quick down yeah so basically like skip has this block SDK and the block SDK allows you to construct your block and they have this whole concept of lanes where essentially you could say okay like the you know the first 10% of the block or whatever is reserved for new addresses that have just like basically it's like their first transaction and these transactions are going to be free or I don't know maybe like governance transactions are free and you can sort of construct your block in this way and enforce uh certain parts of the block for certain types of uh transactions and you know like new new users using the protocol for the first time is like one of those use cases I suppose my

knowledge of that was that it was mainly for me protection is that a correct understanding it it is for me production but there's also like you can also use it for this kind of use case right where like a user that just received say like Adam on their osmo account it's like a brand new address uh and they' they don't any osmo to pay for fees you could say okay this is a new address we're going to give them like their first five transactions for free or something like that like a fee Grant yeah yeah yeah like a you're saying like a fee grant for new addresses right yeah or certain types of certain types of transactions could be free and you would have those like sort of in in a specific Lane got it um I mean I could see it being similar I know we've had very

similar conversations uh you know and I like you know magma from from Skip and I love those guys but um you know I think I I think we're solving probably similar things when it comes to that because you know you're right it's it's a huge pain for a new user and especially it's funny on Cosmos uh an account doesn't get activated unless it has money in its in its wallet right and so this was a big problem we ran into probably like a year ago in testing um before everything really kind of came to fruition which was it's like oh my God we have these people signing up but they need to claim funds we need to send them funds so that they can do a free action right and it's definitely an interesting concept um you know I think one Lanes is is an

interesting way of kind of approaching it and I think it's very meev specific um but I do think that aspects like that kind of solve similar functions which is you know I think near did it as well which was like every new wallet got like $5 and near and it was to make that first transaction because that's the worst thing for a new wallet is a it's not activated I can't do anything even if it's free um but then bi after to then you know the process of doing that is is really tough and so you know that's why I say say it's it's probably on the other end of the transaction where it's not before TX it's on after TX I think we're solving the same things the problems in crypto arise in in very similar formats and you know the skip team has always been extremely extremely

bright and extremely intelligent and I think it it's it's easy to understand these kind of problems and to be able to solve it especially you know and then what I was saying about kind of the skip Lane specific part was it was very very tailored to this MV protection um you know and I and I think for us a lot of it is more encompassing of you know we talked about this a little bit but it's like hey we don't think the mint module works very well in the way that it is um and then you know we think that fees should offset inflation as well uh and then also we think that people aren't going to be using the Zion token to be doing transactions like I don't I don't imagine a world where a lot of people are using Zion to make transactions like

I want Zion to be in the back end really really badly right like I would rather you hold salana and usdc in your wallet and then you can Ed that and then it would be converted to to Zion right so when I say we're solving it from different ends right like the before TX and after TX like that that's more what's going on in my mind which is like don't think about it like we're solving the same thing from from a different end point and for different purposes so yeah let's talk about the the mint module um you you've you guys have written about this on your blog quite a bit and like in the context of um offsetting inflation and and um sort of having a maintaining good ratio of Stak to liquid Stak tokens C can you

expand on This research and you're thinking about what is the right way forward for Zion yeah absolutely and this is this is all you know I'd love to love to call this part like mattis's uh kind of brainchild as it comes to it but something that he brought up and something that we really noticed very quickly was that there is an immense amount of hyperinflation right you look into this and it's like well why right apy are you know apy are fine but why is the inflation so high you know you look at the the kind of the calculations behind it and you're saying okay we're doing the calculations for all tokens in existence and then Distributing that towards people who are staking right why don't we just provide the same API and to everyone that's staking like wouldn't

that theoretically make more sense wouldn't that be more sustainable and wouldn't like it was funny because you you always have these moments especially in this industry which is like why the [ __ ] did they decide to do it this way like why is this the standard you know and I think it was it was you know obviously kind of montis taking a step back and hitting this first principal approach of saying dude I think this is [ __ ] stupid um you know and so we rewrote the mint module in a lot of parts of it to you know to distribute staking for your API for stake tokens right and what this inherently means is like especially in the first couple of like 12 months I think we can promise a 15% inflation and then hit like a less than 1% oh sorry 15% API and hit less than 1% inflation

right it starts kind of if you have everything staked and you have everything unlocked then it starts to look the same right because if if all the tokens are staked then it's then you know API equal stake tokens in in kind of any capacity um does that make sense yeah how does that work practically then so can you give some examples of what um what the inflation would be like given certain amount of stake um and what's the optimal kind of ratio there yeah I mean I think you always you know I think you always have this kind of optimal ratio of like you know ideally you have 40 to 50% I think it's kind of what we normally see obviously you want as much staked as possible Right like that's definitely incentivizing to be as

a staked as possible um you know what was sorry I what was the first part of your question yeah I mean what's the um can you give some examples there of like what that would look like in in production uh yeah yeah I mean I can look I mean I can give you an example of what it won't look like um but it would be like like the user wouldn't really know you're effectively getting what you promised um and the chain isn't suffering from it right like say you were to stake you know you know say you were to stake you're getting 50% apy no matter what on what you're staked right it doesn't matter what matters is you look at the entire piece of the pie and we're only effectively

individually you know giving that 15% to everyone that Stakes right not not this kind of weird other way around which is oh okay this is theoretically what the staking wage would be if everyone staked but let's take that like let's take this act you you have these two layers right like if you would imagine if you would imagine like this being the amount of tokens that are kind of minted because of the apy but then this is the amount of tokens that are staked you have this like thick thick layer of fat that's like why do a why are we inflating this if we don't need to if the stakers are all getting rewarded why we have this thick layer of fat and what do we do with it we just give it to the other stakers right and so you get the same

you know you effectively get the same 15% apy but everyone gets hurt in the end um you know and and I think you looked at this like I think at some point it didn't really matter like when you had like 100% of tokens being staked the math is the exact same as doing the way that we're doing but I think to give you the example right like you saw some pretty you know intense inflation rates and pretty like like average apy right and it was you know you look at some of this and you look and you say oh wow that's that's just not sustainable right and I think there's an incentive to stake and you know we need to provide security to the network we need to

provide the incentive to stake but also why are we why are we sinking the ship in the meantime right like how short term Vision are we looking here where you know this is this is getting out of control I so so you if I come back to sort of the Crux of the issue here the issue is that say we have a 15% U apy on staking so you stake your tokens you get 15% apy on on those tokens but there's a uh 4% uh inflation rate right so like the effective the effective ify that you're getting is is not 15 it's it's 11 because there's an inflation rate of four and so what you're saying is that uh rather than spreading that inflation um as if all tokens were

staked that the inflation is effectively proportional to the amount of tokens that are actually being staked that is exactly correct okay got it okay and so then I mean in in that in that context and like wouldn't the incentive just be for everyone to stake and just get liquid stake tokens and then we would just be sort of back at at the same like you're just back in the same I think you you're probably back in the same situation realistically like a I think that happens over a I think that happens over time and there's never going to be 100% of the tokens that are in circulation just ever right and it's more of this fact of

like hey why are we doing more like why are we doing extra than we need to right why don't we just do the amount that's correct instead of having this layer of fat so you know I think we can talk in hypothetical like oh let's imagine 100% of people are staking but I think you and I both like look at other projects right you look around the industry and you never have 100% staked right you're wouldn't it's just it's it's illogical to kind of assume that and I think um you know we see a lot of the times it's around 40 to 50% is staked um you know and I think there's you know there's going to be kind of some that's Stak there's going to be some that's probably used um you know but normally I believe what we see like I think Celestia I

think injective sees like 40 to 50% and I think that's where a lot of these like our assumptions are based off of um because you really rarely see close to 100% staking staked oh yeah of course that's uh but I was just thinking un and and I think like another thing that also kind of screws projects over that we're trying to avoid is like you know letting the community do the staking why is it you know why is it the treasury shouldn't be staking if it's not unlocked right like you shouldn't be having the treasury making money when the community is getting screwed over right like it should be for securing the tokens that are available to the market and I think that's where this calculation also makes an assumption which is saying um you know we're we're going to be very true to the community

especially in you know especially while we're getting the bootstrapped of the network and everything's getting started it's like the people who will be earning are going to be the people who are securing the network it's not going to be this like kind of freefor all per se which we've seen yeah time and time before so let let's talk about the stack a little bit so you you guys are leveraging the the cosmos stack like why uh did you choose to use Cosmos and you know since you're coming from salana I guess uh I'd like to know why not build this on as a salana roll up or like build this with the salana stack or or any other stack like why why leverage Cosmos there's a few reasons number one the time that we did made this decision right arbitrum optimism wasn't really wasn't really a thing like 2022 yeah

they were coming out yeah were they're fine they weren't really a thing um neither was a Solano up that wasn't really even an option um uh I think that the only ones we could really make our own chain was like polka dot and parody wasn't an investor to us right I I love the team a lot but um it was Cosmos and it was um you know polka dot and or it was uh polygon for own chain and you know number one there was always the the question of like hey why don't we just try to do this somewhere else and the answer to that is like grass is legitimately never greener on the other side um you know and I think we had a lot of Scar tissues from what we' built and and um you know I love the salon of community to death but you know when

you're competing in a generalized environment and like the decisions are being made for you know def or or watch heart right then you start to get these kind of scar tissue that formed which is like we're making this for the specific purpose so that we don't have to compete right um subnets were still iffy right like this was even before like cbata went to a subnet and they realized hey this isn't as sustainable as we we think and made some really awesome changes to it um I think Cosmos was like I say Cosmos is the end game of like crypto like I think Cosmos got the end game right and I think I saw a tweet the other day that said it too but it's like if you took eth and you took Cosmos you we're all effectively solving the same thing but Cosmos solved the end game

first and then went the other way eth started off with like started off with eth and then roll uped all the way to what Cosmos will effectively become um you know and so you got things like IBC IC um also we work out of the injective office so it's always been helpful to uh you know to kind of have them uh you know as they're kind of my my longtime friends um additionally a lot of the team came from Cosmos just kind of happen sance I think you get the independence of Cosmos to be as part of the community or as not part of the community as you want and it's up to you right you can work with people you cannot work with people um obviously it benefits everyone to work with people but um you know I think you have such an interesting community of like people who

don't need to be there like like that you see with other generalized l1s but the people want to be there and I think that's a very key difference that is only really seen in the cosmos Community yeah that's that's an interesting take um I mean I I I agree on on a lot of those points I think that this idea that you can use the cosmo stack and you know decide to work with people or associate with the brand as much as you want or not you know in the case of chains like dydx for instance or uh or say right like they've sort squarely gone in the direction of like they want to build their own thing and not necessarily associate with the brand but leverage the stack and then other chains are going to be like super aligned with The Branding and super aligned with the kind

kind of like Cosmos ecosystem and you know I've talked about this many times on the podcast but I see it as s of similar to to Linux in that perspective where you know all the devices that we use on a daily basis pretty much all use Linux uh um as a the ls kernel but none of them associate with the brand meanwhile there's like tons of operating systems that do right and so um and so that's the beauty of of like building this sort of endgame thing first and then kind of going back and and uh having people build cool stuff with it um so yeah very very cool and so before we wrap up here what's the current state of the project and uh you mentioned earlier there was a test net going on when's the main net when's the tge when air drop yes all the stuff people want

to learn about of course of course um so we we finished our last test net uh our last test net ended with 450,000 wallets I think it was like 4 million transactions um and we have been upgrading later part of December to the generalized subtraction testnet which was when we release the white paper uh which will then have everything that we're talking about with like abstraction 2.0 that we I think we just made an announcement of one of the projects kind of coming today but that test net will be opening up very very soon um you know and I think you know really once we're done there once we're done there once we break everything that we need to break and make sure everything's kind of done then then uh yeah then I'll see you on Main that right and um you know dates are always

hard in this industry as you probably know but you know I would definitely this year I mean not not to give I know that's not too specific but you know if hopefully this test net go you know hopefully we don't have to make any changes as testnet we can hop in you know tomorrow but you know uh main Net's coming right after testnet and we're really excited for that great well Anthony thanks so much for coming on the podcast today and enlightening me about Zion and um and did I help is there anything that would have made it clearer earlier on by the way that's that's a question for you no I think it's it's pretty clear I guess I guess like for me it it always it always becomes clearer when I see sort of tangible uh examples of applications and

and chains that are using this Tech and so like where it sits in the stack and you know how they integrate with it and then what are the applications that have come out of that uh but that will come with time uh as uh as you guys roll out um yeah thanks again and we'll uh we'll catch you very soon thank you it's a lot of fun appreciate it