Kiln merge testnet live, L2Beat updates and more - The Daily Gwei Refuel #335 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the delegate refuel where recap the latest news in the ethereum ecosystem i'm your host anthony sosano and today's the 15th of march 2022 all right everyone let's get into it so that legislation that was being voted on in the eu parliament surrounding proof of work that i spoke about uh the other day whether it was yesterday or the other day i can't exactly remember uh that was voted down actually over the last 24 hours so uh it was 32 against 24 in favor obviously this is a big relief as patrick hansen says here and a political success for the bitcoin and crypto community in the eu so there's a breakdown here in patrick's thread that you can read i'll link it in the youtube description but this is this is good i mean i know i mentioned the other day

that i think it was kind of a slippery slope fallacy where people kind of basically said that you know if they were successful in going after proof of work are they being governments they'd come after proof of stake next i don't think that they were going after proof of work because it was a crypto thing i think they were going after it because of all the kind of like stuff happening obviously with the energy crisis especially with the uk and russia conflict going on the eu gets a lot of its oil from from russia and obviously with the sanctions and things like that that stuff is changing there so i think that was a reaction to that rather than being a targeted attack against crypto now as and as i mentioned the other day i think that proven work is going to have a hard time

and i mentioned this over the last few months it's just going to have a hard time going forward regardless of legislation like this it's going to keep losing the narrative battle with the kind of like non-crypto people now whether that matters or not is a whole different story i i don't think it matters too much in the in the long term but i do think that uh or at least i'm very glad that ethereum come the merge which i'm going to talk a lot about in a sec won't have to deal with this right we'll just be on proof of stake we won't have to do with any other proof of work stuff and i don't think they're gonna be able to come after proof of stake as i've mentioned it's just it's too difficult like not only is it difficult to identify stakers but it's also difficult to kind of like

go after them and basically say hey you can't run this piece of software on your computer right like mining is a bit different because mining obviously has like a large footprint a large kind of has a kind of physical footprint whereas staking does not especially ethereum proof of stake like as i've said before all my stake is run on my little staking box that you guys have seen in my old videos behind me and that powers it just fine i have no issues with that whereas if i was to do the equivalent in like a mining setup or or a kind of like industrial miner um it would leave a much larger footprint even if i was doing it from home and just had like a bunch of gpus around me it would still use a lot of power and would still actually register with the the power

company so i think from that perspective i just don't see how they're going to go after proof of stake like it's literally banning people from running a piece of software on their computer and i mean you can outlaw that i mean governments can outlaw that as much as they want just like they've they've outlawed things in the past software in the past but you can't stop people from running it i mean like how are you going to stop people from running the the client software on their own machines i mean you can go after the client teams but there's still going to be people people picking that up even if you go after the client teams and that's kind of like a squashed earth approach then and i just i don't see that going anywhere near that far i feel like that's just way too much effort way too

much kind of like fighting for the government because they have to fight this in the court and things like that i don't know i just don't see that happening at all but i do see a lot of headwinds for proof of work whether justified or not doesn't matter what your opinion of proof of work is if you think it's a good thing a bad thing whatever there's going to be headwinds regardless and i just don't see any of those same headwinds for proof of stake which is obviously very beneficial and it's not like ethereum has just kind of decided hey we're changing the proof of stake because of this it's been in the works for a very long time since vitalik published ethereum white paper he's been thinking about ethereum as a proof-of-stake network so that's what makes it even better is that it's not just a reactionary thing for

ethereum it's a long time coming the merge is around the corner at this point and we're going to be able to kind of do this at a time where uh i guess like a tax against proof of work is really ramping up and i just i don't think ethereum should waste its time battling or having you know or fighting that battle because it's just really at the end of the day just gets us bogged down doesn't let us kind of continue to innovate and continue to build where we need to be building because there's a lot of places that we still need to be building guys i mean the merge is just i guess like in the grand scheme of things a small piece of the puzzle of the ethereum roadmap we have all these things coming down the pipeline the sharding stuff the continued layer 2 growth the

statelessness uh you know it's like a finding the base layer all these sorts of upgrades that we've all seen in vitalx roadmap that he put out that is not going away we need to do that we need to get that done we need to implement it and i'd rather we focus on all of that than focusing on fighting a battle against people that don't like proof-of-work uh leave that to bitcoin they can fight that battle they don't have much else to going on in their ecosystem anyway so they have plenty of time to fight that battle but i don't think it's one that they will quote unquote win i think there's going to be compromise i think that uh mining is just going to keep basically shifting around a little bit from geography to geography which is which is totally fine i think you know bitcoin being able to

kind of like uh ship out of china so quickly and get stored up elsewhere it's actually kind of impressive i didn't expect that but at the same time there's just going to be more and more headwinds as time goes on whether you think it's justified or or not here but i guess good good result here from the eu parliament regarding the latest legislation we'll see if there's anything else introduced and see how that plays out going forward all right so merge updates now i think i know how to say this name or this word correctly now i think it's kiln i know i say killen a lot but it's kiln um and i think i learned this from a video uh what was a video um auntie donna it's a popular australian um uh youtube channel it's a it's a comedian it's a comedy

channel and they said kiln and i'm like ah oh i know that word i'm saying it wrong and yeah okay it said kyon so kiln the next iteration of the ethereum merch testnet as i've been talking about is now live so you can go to this official kind of like announcement blog post from the ef that tim biko shared read all about it here and i think in a couple of hours from when i'm recording this the change will actually merge so it's estimated that we'll hit will reach that ttd the proof of work and proof of stake test net chains on kiln will merge together and uh that'll be it right if that all goes smoothly everything's fine there's no major bugs and we keep running and and everything's working that's the best possible outcome and that means that we will get the the kind

of like next steps which is uh um basically merging girl lee and roxton and all that and then moving on from that to to mainnet so as i said guys it's around the corner it's so close i'm talking about the merge every day now pretty much because it's so close to happening uh you know it's it's march we're halfway through march and it could happen in june like april may june guys it's like three three months maybe four months away it's so close after waiting all these years right i mean i haven't been in ethereum since day one um but i've been waiting since early 2017 where peop you know people thought it was coming in 2017 it being proof of stake uh and i've been waiting so long now like five years over five years now and the fact that i can see it i can just

see it right there like i can see the light into the tunnel we're almost there and i can't even imagine what the feeling is like for for someone like vitalik and the early core devs that have been there since basically the beginning to finally see this all come to light it's it's got to be an amazing and surreal feeling at the end of the day so as i said there's this blog post you can go check out that has instructions on how to join the kiln test net and how to kind of like um participate in the whole thing uh and be sure to do so if you are able and if you want to get involved here every little bit helps obviously we want to test this as much as we can as i mentioned before because this is something we don't want we don't want to get wrong definitely so

very very excited to to see all this uh i just i honestly guys like not even just within crypto but just in general like in my life i have not been excited about something uh like you know like the the merge happening uh uh for a long time or basically like i i mean obviously you guys know i bought a new house recently that was super exciting and all that sort of stuff but i mean this is just something different like this is something that i feel like i've had a you know hand in building through education through getting more people on board through spreading the message all that sort of stuff obviously not direct building as i'm not a developer but i feel like i've had a hand in kind of definitely highlighting this and educating about it for years now i have a blog post that i wrote in 2019 that

spoke about ethereum's move to proof of stake it wasn't called the merge back then but i mean i've been writing and talking about this stuff for ages so it really feels like uh the community is finally going to be able to all come together for that one fateful kind of like day where we do the merge and it's behind us and ethereum is never going back to proof of work right it's just going to be proof of stake network and we can move on to uh upgrading the network and get back to our regular scheduled scheduled programming of regular kind of like network upgrades and i mean i'm just as excited for shanghai the first network upgrade going live after the merge because we have a couple of eips in there that uh that that are going to really help out l2s and get those fees

on l2s for a swap uh to sub 10 cent transaction fees or even on optimistic roll-ups that's going to be super exciting even even lower than that we could get some five cents so that is just as exciting to me because we basically have the merge which obviously doesn't lower gas fees you guys know that that's god i have to repeat myself uh because it doesn't guys and i i've seen a few of you guys correct people on twitter and things like that i love that um but yeah the merge itself doesn't do anything for the end user right the end user is not going to feel anything different as i've said the only change that the end user might feel is the block times getting slightly shorter from 13 seconds to 12 seconds but um other than that it's going to be the same they're going to send their

transactions they're going to be packaged into blocks and that's all well and good whereas the eips that are coming with shanghai to reduce costs for l2s users are going to definitely feel that right like everyone's going to feel that that's on an l2 so those sort of things i think i'm looking forward to for a different reason uh but still very very exciting uh all around that as well but definitely check out this post all in kit in the youtube description all right so we have trent's seventh tweet about the merge so at the merge the two eighth power power proof of work block reward goes away new issue issuance will only come from proof of stake validates proposing blocks which is around 0.0 per proposal of blocks or a testing aka voting on network state which is

0.4028 which you've probably seen if you monitor your validator on something like the beacon chain websites um and for there's 4.3 uh percent to proof of work issuance right now uh that's not accounting for the burn by the way are going to 0.43 in proof of stake and obviously that will go up if there's more each staked but then there's more heat being staked which means that we're locking up more eath and it's all kind of like a self-balancing act there which is which is really really cool so if you want to read some finer details about this you can go to this i guess um knowledge based article from the beacon chain website here that goes into detail about it it's linked in trends thread as well but basically uh guys i've been talking about this for as long as i can remember this massive issue introduction

i tweeted out to say where i said the merge is not priced in i don't think it is i know the eighth price is doing nothing right now it's like seems to be stuck at 2500 just crabbing away i i it does that right it does that and it's done that plenty of times before but it just surprises you at one point i'm not i'm not saying that it's going to go up from here it's going to go down from here i don't know like over the short term but i really truly believe that the merge is not priced in because how many people honestly understand that this issue introduction is coming i mean you still have people thinking that the emerged lowers gas fees you have people thinking that the merge results in uh 10 million that's being staked right now automatically unlocking those are the

two biggest bad narratives out there and and they're actually spread more ah i guess further i guess they they're more well known than the insurance reduction so when you which is code name the triple hardening that squish chaos kind of coined that term so when you kind of like take that into account how could this possibly be priced in how could the merge as a whole be priced in i don't think it is and there's all the second order effects as well which actually superfius touched on today in his tweet here about how um ethereum's move from proof of work to proof of stake will reduce our energy footprint our being the ethereum network's energy footprint by 99.98 yes that's right guys 99.98 this is actually based on research it's not

just a number superfiz throughout this is based on hard research done a little while ago that was posted i believe to the ethereum foundation blog that detailed just how you know massive the energy cost reduction was going to be here now this is what i mean by second order effects as i was discussing earlier about proof of work versus proof-of-stake uh there's gonna be the second-order effects people being like oh wow you know now ethereum basically uses much less energy it's not killing the environment whether you think proof of work kills the environment or not is another thing you know it's just the narrative this is what i'm talking about um people are going to are going to suddenly be like oh wow yeah that's awesome you know all the people that were kind of like hating on ethereum and stuff like that i know some of them are

going to just like move the goal post that's all well and fine that always happens but just for the sake of the argument um you know these people are going to come around and then ethereum is going to have a much better standing in the esg community or in the the community that that really i guess like is concerned about environmental impact and on top of that we don't have an energy footprint when we don't need to and we're more secure i mean in my eyes i know people will disagree with this but in my eyes ethereum proof of stake is the most secure consensus kind of like engine in in the world i know there's been kind of like um uh some some uh i don't know if i'd call them vulnerabilities but kind of i guess like things found recently that they need to be fixed but that's

just early days for a theorem proof of stake and there are fixes in place for that but i think that for a cost benefit and analysis you know the amount of of kind of like um i guess money it costs to secure a proof of stake network is vastly less than a proof of work network and you also get in my eyes a better trade-off with kind of like malicious actors where we can kind of like force them out and slash their stake rather than with proof of work if someone wants to be malicious you can't really do anything about it you can't kick them off the network you can change the hashing algorithm but that punishes all the honest actors as well so there is a lot of second order effects to the merge here guys outside of that issue introduction uh that i i

don't think people fully appreciate i don't think people realize just how good that's going to be for the price of eighth obviously not investment advice but i i truly believe that um you know the merger is going to be incredibly bullish and it's funny because like we're still burning each as well i know we're not burning as much as we used to be because the fees are down but the fees aren't going to stay like this forever if the merge kicks off another eighth bull run uh with all the hype and the narrative surrounding it those fees are going straight back up to 100 way guys like don't even i mean i i don't even need to kind of like debate that i think that that that's definitely going to happen and then we're just going to be burning more eath on top of that

massive issue introduction and even at current grade prices of around 20 we're still net negative issuance so and and as i said before withdrawals aren't being enabled until at least six months after in the shanghai upgrade so there's gonna be a dead zone a dead period where no new ethics being issued into the network for at least six months uh guys i don't know how many times i can repeat myself here this is just insane and i don't care what the price is doing in the short term i'm still buying as much as i can whenever i can um i really don't give a about what price i buy it at now uh i just think that people have not fully kind of like digested like 99 of people in this industry have not even understood let alone digest than what the merge means for each as an asset what it means for

ethereum as a network and all the second order effects that flow on from that so i hope you guys are i hope the few thousand that watch and listen to the refuel are fully aware of this by now acutely aware of it even by now because i've talked about it so much for so long um and i i hope that i've kind of like helped you to basically shape your i guess thesis around eath and ethereum and things like that because you know i'm not lying this is all based on heart of fact i'm not selling you a narrative i'm literally giving you the facts the way it's going to be um based on the code essentially right uh and and kind of like my kind of opinion on it as well but maybe it takes six twelve months after the merge people to kind of like

digest this i don't know maybe you know maybe there's kind of like a bunch of hype and traders just taking advantage of the merge as an event to trade around and there's a lot of volatility i actually expect that to happen because the same thing happened when the beacon chain launched and obviously we see a lot of volatility around other coins when they have major product launches and things like that but i do think that long term the merge coupled with the burn and everything else going for ethereum is stupidly bullish and uh buying ethio in in my eyes uh you know and it's why i keep doing it is is is is a good bet uh you know it could go down from here it could drop 50 from here i don't know uh but i don't really care to be honest right i mean it for the long

term as you guys know and i hope all of you are as well all right and this is just ultrasound money posting a meme about the issue introduction here where it's going from 15 000 per day to 1.5 k per day and you know this guy sitting in the corner saying they don't know at the party i'm sure you guys have seen this meme i feel like this guy in the corner all the time you know not just you know in real life but kind of like online different social circles i'm sitting there being like they really don't know they don't know that this massive fish introduction is coming they don't know all the stuff that i was talking about before um obviously not you guys but like most people as i was mentioning before i'm not going to not going to rehash that but but yeah i just thought that was a

little funny little meme that i kind of related to there all right an update out of rocketpool today so their new node operator page is now live so if you're interested in becoming a nerd operator you can visit this page here which is at rocketpool.net node operators and this will walk you through exactly how to do that which is really really cool so i mean this is just helping i guess um decentralize the rocketpool network obviously adding to the decentralization of the ethereum uh beacon chain and post merge just the ethereum network in general there's a bunch of different tools on here like sliders and you can kind of like see what the apr is and things like that um at different heat stakes and and kind of like with commissions and things like that so and kind of like information that you need uh

on how to get involved and kind of like what the gas costs are i mean there's a lot of information here like you can see i'm just going through the page right now i highly recommend you going and checking it out and and as usual i recommend joining the rocker pool discord i wish i had more time to spend in there but one of them one of the most uh one of the best rocker sorry one of the best discord channels i ever going i always i don't know if i mentioned this before i i always love going in there because i feel so welcomed like honestly like i go in there i make a few comments uh you know when i've got some time and i just feel like a superstar going in there so it's actually a really really humbling feeling and and as i said

before rocker pool is one of my favorite projects for for numerous reasons so if you're willing and able and interested in becoming a rock-a-pool node operator and you have the minimum which is eighth year uh then definitely go uh i kind of like check this out i'll link it in the youtube description for you below all right so l2 beat has put together a thread today about uh what they've been working on recently so they've been quiet as they said here but they have been busy so they're obviously getting ready for the lair to amsterdam conference which i'm hoping to see a lot of you guys at so i'm going to be there for sure uh they've been working on a dydx escape patch and making it a reality which i i think i mentioned on the refuel of may i don't know how long ago i think it was a few

months ago yeah in december of 2021 um and they're working on setting up monitoring infrastructure for roll-ups users will be informed of upgrades important security parameter changes etc a new risk framework um and they they made friends at eth denver working on a risk framework for bridges so a lot happening on the l2 beat side you guys know that l2b is one of my favorite projects in this space on my favorite websites and i'm really interested in kind of this monitoring infrastructure that they're going to be setting up and how that will that will kind of work because that'll be really cool for users to be able to sign up maybe it's a paid service maybe it's you know it's not maybe there are just certain things that are paid like a premium service but i think that's actually would be really important because you know imagine a lot of these kind of

like l2s roll-ups whatever you want to call them have these training wheels and centralized admin keys on them and you want to be notified when they've done kind of like an upgrade to the network or when it's offline or something like that uh and you have and you want to have like an all-in-one reliable service to do that well that's what l2b seems to want to be able to provide here so i think reliability of these services is the thing to get right because there's uh there's been times where some of these services not l2p but other similar services have basically not been reliable enough to tell people when something has gone wrong and that obviously defeats the whole purpose because it's all well and good for it to tell you that everything is fine nothing has changed in like the steady state the normal state but you don't really care

about it at that point what you care about is when the change does actually happen and if the service isn't there and ready to show you that information then it's a useless service so i have full faith in the l2v team i mean they are amazing they are some extremely smart people they know exactly what they're talking about exactly what they're doing so i'm very much looking forward to seeing them ship all of this uh and they also said there's more initiatives they'll be that will be announced in the near future as as well so very much looking forward to everything that uh l2 beat has coming down the pipeline all right so finally here we have stocknet alpha 0.8.0 which is now lived on testnet with an important feature fee mechanism so this feature will be optional for the current version to allow the ecosystem

to learn how to implement it and there's a bunch of other things that are new as well so you can check out this blog post here uh for basically what's new in stock net uh alpha 0.8.0 as i said this is on test net not main nets right now and the major addition is a fee mechanism now obviously as i said before every l2 regardless if they offer extremely cheap fees is uh going to have a fee market a fee mechanism because as kind of like starkware details here uh it's it's it's crucial for system performance right as it prevents spamming now that's the number one thing i think that a fee market is really good at right other than i guess like balancing the the supply and demand it's good at just reducing the

spam because we've seen this play out on other trains before especially solana which has obviously very very cheap fees the network just gets spammed uh because it's so cheap to do and then you can either implement a fee market which they're pretty much doing at this point or you can do something like quality of service you can drop transactions that you suspect to spam which i don't really like i prefer free markets uh and that means that everything has to have a free market in my mind and that doesn't mean that the fees have to be really high but there's going to be kind of like an equilibrium point where if the fees are too low there's going to be too much spam if the fees are too high end users are going to get hurt so there's going to be like a healthy middle ground i'm not sure where that

middle ground is going to be we're going to have to see what what happens there and i honestly think that long term all these roll up operators and networks are just going to be paying the fees for their users themselves by taking fees out of other places so as dydx does as i've explained before rather than charging the fees directly to the user so that the user just gets a seamless kind of like experience right like seamless fast transactions free transactions you know free for them but obviously being paid in the background because these l2 still need to pay ethereum l1 for for their security uh and all that good stuff there and obviously the operators of these l2s need to be paid too in some way when you want to decentralize it out so definitely go check out this blog post from starkway here i'll link it in

the youtube description but i have a few more minutes here left today so i did want to kind of like talk about something i saw a fair few comments in the discord channel about the market being really boring right now i know i spoke about the markets recently but i wanted to just kind of like touch on something really funny the way i feel about the market right now is the way i felt about it in 2019 where it is boring guys like it's so boring people are on twitter making multi-million dollar bets on the price of an asset a year from now i don't know if you guys saw that today about about luna because they're so bored traders are getting chopped up there's no clear trend it's just very very boring but the amazing thing about the ethereum ecosystem the amazing thing

about being in it for the technology is no matter what the price is doing it's pretty much impossible to be bored i'm still here every day giving you guys half an hour of ethereum updates essentially every single weekday uh you know there's still and i'm not even covering any everything i'm not even scratching the service a lot of time i'm just keeping it at you know high level to the things that i think are most interesting um and this is regardless of what the price is doing price goes up price goes down price goes sideways ethereum keeps keeps going ethereum keeps chopping and chugging along the building keeps happening as i've mentioned before there's plenty of money left in this ecosystem to find builders you know for the next decade at least uh and there are a lot of teams still raising at crazy valuations i mentioned

some of them recently uh with um you know starkware's rumored six billion dollar evaluation raise and then immutable x had their 2.5 billion sorry immutable had their 2.5 billion raise so when you take a look at it like that or holistically the market is the market it's going to do what it's going to do as i mentioned earlier you know i don't think the merge is priced in i don't think anything around ethereum is priced in to be honest i think people still have absolutely no idea about a lot of things when it comes to ethereum they just don't understand that i've always said that the most bullish thing for ethereum is to be understood i think i got that from ryan sean adams and it's so true right the more people that understand ethereum understand its roadmap its vision understand how ether crews value

due to ethereum kind of growing the more i p the more valuable eth becomes and i think that's the bet you're making when you're investing in each you're basically betting that as time goes on more and more people will become aware of the the things that you are aware about about ethereum and about eighth and naturally the price will rise because of that now can the price fall 50 from here sure it can will it be really scary of course it will that would mean like a 1258 that would be below the previous market cycles all-time high that would be unprecedented so i think there's a low chance of that happening but there's always a chance should that prevent you from buying now if you want to probably not right like dca-ing in and out probably a good strategy over the over the long term like i uh as i said i buy

when i can but i i can't sit here and tell you like so many other people will sit there and tell you what the market's going to do i don't know what it is going to do i don't know what bitcoin is going to do i don't know what um everything else is going to do over the short term even over the long term i can i can basically say with relative confidence that a lot of things are never going to to come back a lot of them are just going to be down 90 plus percent because we've seen this happen before but there are you know a handful of things that will go on and continue growing and and get much bigger than what they are today but i can't tell you when that's going to happen i can just tell you that i

believe it's going to happen um i could be totally wrong of course but i don't think i am of course right but just sitting and staring at charts and watching it go sideways there's no point learn go go out there learn about the technology plenty of stuff to read plenty of ways to get involved plenty of things to do if you're not working in crypto and you want to work in crypto now is the best time to get a job as i mentioned before so i just wanted to kind of like reiterate all that because i've seen people and just be bored and really i just don't understand how you could be bored in this industry if you were doing the right things and maybe you are just in it for the money that's totally fine like there's no i i mean i it to be

puzzling why you'd be watching the refill if you're just in it for the money but that's totally fine there's nothing wrong with that i mean most people are in it for the money uh and you know you can be in it for the money over the short term make the money and then be in it for the technology over the long term because you just wanted to make the money to enable you to to basically focus on the technology more totally fine again but if you are in it for for the tech there's no reason to be staring at the charts uh worrying about the price over the short to medium term there is every reason to be getting more involved with everything learning as much as you can about technology and investing in yourself as i always say guys the best thing i ever did was

invest in myself rather than invest in the markets directly because that paid off more than any of my investment into into eth into anything that i bought on public markets investing in myself paid off a million a million times more not just on the money side of things but on the social side of things so that is advice like that is life advice not investment advice that is life advice i strongly strongly encourage you to invest in yourself in any which way that you can um maybe i i should detail that one day and like how exactly to do that but i think that the trdr is that just improve yourself in any way that you can even small iterative improvements every day over time add up that's what i did over the last few years and it added up really quickly and it compounds from

there and you get to a position where you basically are very very happy so so yeah anyway i'm gonna leave it at that for today uh so thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give the video a thumbs up subscribe to the newsletter join the discord channel and i'll catch you all tomorrow thanks everyone