Layer 2 chat, EigenLayer update and more - The Daily Gwei Refuel #577 - Ethereum Updates

Transcript

hello everyone and welcome to another episode The Daily gray refuel where we cup the latest news in your theorem ecosystem I'm your host and this is Hunter and 32nd of May 2023 right everyone let's get into it so apologies for missing yesterday's episode I kind of rugged Myself by doing an episode on Saturday because yesterday I didn't really have too much talk about since I had spoken about a lot on Saturday already but I'm back today with a few new things to talk about so uh without further Ado let's get into it so starting off today's episode is a new uh thread from Terence covering the eip4844 implementers call number 21. now I didn't even realize there had been this many calls to be honest I know I've covered This Thread that Terence does a bunch of times on the refill before but this is pretty awesome there's already

been 21 of these calls and as you guys know 4844 is already included in in uh Cancun the next Network upgrade it's not like 100 included it's just obviously as I was talking about the other day there's these the concept of drivers and passengers it is the driver for the upgrade which means it's basically like 99 sure to go in unless there's something critical that goes wrong with it then it may get removed but the thing is is that because 4844 is a driver if there was something wrong with it I don't think it would get removed from the upgrade what would happen is that the upgrade itself would actually get delayed because without 4844 the upgrade could still go ahead with the passengers but it doesn't seem as appealing or as enticing to do a whole network upgrade

just with the other eips that are both included so far and being considered for inclusion so yeah I mean at this point in time I would say 48 44 is 99 sure to be included in in Cancun that one percent just exists for any kind of critical bugs or any issues around that that could pop up there but yeah you can check out terence's thread to offer full details on the implementers call number 21 here I believe it was quite a technical call this time around there weren't um a lot of things discussed that are really new it's more of kind of like dot in the eyes crossing the t's and doing the devnets as we see you know there was devnet 5 that spun up the other day so yeah things are moving you know things are moving very well I think we're pretty close to uh maybe a longer

Live Test net not just the devnet being spun up for it for this uh and uh yeah hopefully uh sooner rather than later on that front as well all right Aditya here who he works at the ethereum foundation put out a blog post uh with a bunch of other authors here and you can see all of them are listed here on the tweet and also in the post itself but this post is titled confirmation rule for ethereum which is an attempt at a fast confirmation rule for a theory of stake with latency under one minute in typical main net conditions so basically what this aims to do is try to have finality within a minute or less I think so I Aditya explains here ethereum currently provides a strong finality guarantee but it has an average latency of 16 minutes

under perfect conditions or two epochs this rule confirms block at a much faster Pace although with weaker guarantee of reversibility then finality so it's not the same thing that we have today with the two Epoch finality uh then it uh then it would be and it wouldn't be the same thing as like single slot finality but it's an improvement over what we currently have and Aditya and his co-auth this year argue why that is the case in this blog post now this bloggers is very technical there's a lot of math here as you can see so if you aren't across these sorts of things you probably won't understand what's going on here but I figured why it was worthwhile to highlight for you guys because I think single slot finality and anything else that can get us uh to to you know fast finality or

fast irreversibility is definitely um something worth paying attention to and definitely something that I don't think a lot of people are uh well I think I think there are a lot of people focusing on it right now on the research side of things in terms of ethereum core research but on the community side of things I don't think enough people are focusing on it because I think for people they they see kind of finality and they don't actually understand what that means and they don't understand why fast finality is is something that would be worthwhile well to give you the quick tail Dr and this doesn't cover everything and I'm not an expert on this of course and this isn't um exhaustive this is an exhaustive list of reasons but essentially uh right now you have I guess like two epochs you have to wait

for that finality which means that you have a 16 minute window give or take I guess like a a few seconds on that front there where things could be potentially reversed there could be a long re-org uh there could be a reorg of of a few minutes right now obviously not that's not good for the network that's not good for for the health of the ecosystem that's not good for anyone really it is still very very hard to re-org the chain um you know even doing a two three block realg is extremely hard to do and extremely costly but it is possible right and it is something that is not punished um he's not punished severely until you get or is not prevented until you get to those finality guarantees there so that's that's kind of like the big one uh the other ones include giving faster

finality to things like exchanges for example so exchanges obviously Will Wait a certain amount of block confirmations in order to consider your deposit final well if you have like single slot finality then exchanges wouldn't have to wait very long to consider the deposit uh final they could do it much quicker than what they can today because a slot is 12 seconds and if you have single slot finality it means you have like two-thirds of the entire ethereum network is saying okay the chain is finalized here at this block which means that in theory the exchanges could credit your deposit within 12 seconds rather than waiting I mean it obviously varies from exchange to exchange but some of them can keep you waiting up to 10 minutes right to make sure the deposit was in there well in theory with single soft finality it would only be 12

uh 12 seconds which is pretty cool one I'll guess like one one slot once the transaction has been kind of confirmed on their end so maybe they do it like a minute or something that's still vastly Superior to what we have today so that's a big one another big one is for for layer twos because properly constructed layer 2 Roll-Ups get to inherit the ethereum finality guarantees or the Hyundai one finality guarantees so it would benefit them uh things like oracles just really anything that relies on not being real even across like slot by slot um it is definitely going to benefit from something like this but as I said that's not an exhaustive list of why we want single slot finality why we want faster finality and why it's desirable you can check out some of the discussions around that I'm sure some of

them are linked in this in this blog post at the bottom maybe uh no there's just a bunch of information here and there's probably links within the blog post but on ethereum research for foreign search you can go check out all the discussions around single slot finality there and I think I shared a document the other day that was written by vitalik or someone else that kind of summarize this as well so you may be able to find that so I don't have the link handy right now but that's something that you can pay attention to as well all right so uh spreak here on Twitter put out a screenshot of a uh a Twitter poll that Dan Robinson from Paradigm put out over the weekend where he said should EIP 1559 or 1559 distribute East

to all stakers rather than burning it now basically the poll uh was I guess vastly in favor of the no option here with I guess like a bunch of people voting yes and a bunch of people voting it's functionally equivalent and then Hayden Adams the founder of uniswap said uh neither uh we should use this money to fund public goods and I replied saying if you want to kill ethereum this is how you do it now I figured this was worth expanding on uh because I think it's very important to realize why I said this and why sending the eth to fun public goods instead of burning it would uh would would kill ethereum I mean not kill ethereum literally but kill I guess like what ethereum stands for at its

core now I've talked a lot in the past about why what I actually consider to be a core property or the core property of a blockchain and that is censorship resistance without censorship resistance and uh without all the stuff that falls off of that such as credible neutrality and decentralization and all that good stuff there blockchain is useless in my eyes it does not do anything that a centralized database can't do better right so from that lens how do you kill something that is censorship assistant how do you lower its credible neutrality how do you lower its its guarantees around those things well you start changing things at the core protocol layer uh that are are currently objective and you change them to be subjective so right now burning eth is

an objective thing then it does goes to no one right it gets I guess pseudo redistributed to each holders and buy a proxy eats takers because each take is a holders right um and then the value flows uh that way but the the value doesn't flow to any individual any one individual any one group or any group of groups or anything like that it doesn't favor anyone except eath holders that's the only thing it is biased against and the reason why we are okay with it being biased for etholders is because if is the thing that secures the network to begin with right so technically it's biased towards ethers an asset not the holders themselves it doesn't care who the holder is doesn't care where the eth is um and it doesn't even care about the USD price the network right uh humans

give the the eighth value but the and the network doesn't know this the network doesn't even know the USD price of Ethan only knows it because we feed it uh the price of oracles but then it's not even the network knowing that it's the different apps that use the Oracle so this stuff gets quite complex very quickly so I'm going to try and try and stay on topic here but essentially what would happen if instead of burning the eighth we sent it to uh git coin let's just use obviously uh git coin or the protocol Guild you know the public goods funding uh initiatives that you were aware of what happens then well what happens then is that you're now taking a portion of protocol rewards in this case execution layer rewards and you're giving it to a group that has control over these funds and that group is made

up of humans that decide what to do with those funds and it destroys the credible neutrality of that because essentially that group is not going to be credibly neutral they're not going to be objective about things they're humans at the end of the day humans are subjective they run on emotions right they make decisions based on those emotions and then you start the infighting right that's a it's a lot of money going to these orgs I mean if you if you just take the amount of money that we've burned so let's let's actually put some put some numbers on here to illustrate my point further so I'm going to bring up the ultrasound money website here I'm going to go since the burn how much eat have we burned well we've burned uh since since um the the burn was uh was implemented here we have burn I'm just

scrolling down here 3.16 million eth now what is that in US dollars at current values almost 10 billion dollars right so let's say all of that agent instead of being burned went to git coin or protocol Guild or any other kind of public goods funding initiative that's 10 billion dollars guys like that's a ton of money right so what do you think is going to happen with that amount of money on the line it's going to be the exact same thing that we see happening with a lot of Dow treasuries people are going to try to loot it people are going to fight over where to spend that money no one's going to agree on anything people are going to try and come in and and course chaos just for the sake of it right there's going to be money spent on things that aren't that the money

shouldn't go to at all right there's going to be people trying to scam it there's going to be people grifting with it it's gonna be all sorts of things happening now why is this bad for ethereum the protocol because the money is coming from the protocol right it's coming from the network I should say it's not obviously coming from the consensus layer rewards but it's coming from the execution layer and then people will kind of see that and be like well what am I paying here like I'm sending the you know I'm paying fees and then those fees are going to these orgs that are just doing whatever with the eighth this is incredibly neutral this is introducing a massive subjective kind of governance layer on top of um ethereum and another sorry another governance layer on top of ethereum's already existing governance layer and it

just causes a mess of things and erodes the credible neutrality uh and of ethereum and the sensitive resistant properties of ethereum and the decentralization of ethereum and and just erodes ethereum as an ecosystem uh because of it so instead of giving these funds to to anyone really into public goods we decided we're just going to burn it right that's the most credibly neutral thing that we can do and it's worked pretty well so far right no one's really complaining about the burn I mean there are people here and there saying that it should go to find public goods but I think these people don't actually understand that the reason why that can't be done is because the subjectivity of it is just too extreme deciding where the money goes is just something that I don't think humans have

a really good grasp over and you can actually draw an analogy uh to this to taxes right so uh obviously you know most Nations around the world charge taxes in one foreign to fund the the the fun a variety of things right now a lot of the disagreements and a lot of the I guess like political uh kind of like landscape centers around taxes and what happens with these taxes where the money goes right and there are hundreds if not thousands if not tens of thousands of people in the respective governance the governments that uh make these decisions on behalf of the population if they make the wrong decision then logically or in theory they are punished at the polls but what is the right and wrong decision because

these taxes go towards different things like if you think that the wrong decision is for your taxes to go towards Social Services then you're going to vote for the party that says they're going to cut Social Services or or maybe you think that it's a mistake that the um the rich people aren't taxed enough so you're going to vote for the party that says they're going to increase taxes on the rich people so you see how this is incredibly subjective and how it just leads to what we see in all across all of politics no matter what the country is and how dysfunctional it is in in a lot of places right and how imperfect it is um and and at the end of the day you know certain countries have um their own all countries uh have their own way of doing things certain countries have very

strong constitutions other ones don't have very strong constitutions other ones don't have constitutions at all other ones have strong social contracts around certain things like in the U.S freedom of speech is obviously something that's ingrained into uh into the country's kind of very core being right uh it's written in their constitution obviously and they defend that to it to a point right to overturn that would be near impossible to to do uh so from that point of view with ethereum we kind of do have a not a formal Constitution but like a well a well kind of like understood thing within the community that ethereum's main draw is the fact that it is decentralized is the fact that it is censorship resistant incredibly neutral and that is what all the other value flows off of now if we compromise on that in my mind it it

really just makes ethereum very uninteresting pretty useless honestly and not something that I see having a long-term impact and I'm talking long long term guys like I've said before that I think if ethereum is built right if ethereum's roadmap is executed correctly and we we don't it up we can make a ethereum a multi-century long Network that survives for potentially even thousands of years right and that that kind of stuff's crazy to me because we do have monuments in the real world that have survived for thousands of years obviously there's a lot of um ruins out there that have that that get dug up and there are certain things in those ruins that are still in good condition the obvious other analogy is like the pyramids for example there are monuments that we have all around the

world and that that have lasted hundreds thousands tens of thousands of years I want ethereum to to be like that but I don't want ethereum to just be something that sits in one place and and is just kind of pretty to look at I want ethereum to be a network that Services the world I want it to remain incredibly neutral decentralized and sensitive resistant and the only way we do that is by not introducing the subjectivity into it right and I spoke about this a lot when we had the censorship happening with the I mean I mean it's still happening with the Mev boost relayers that is another kind of thing that introduced subjectivity to the network and and it's a consequence of ethereum not have having a proposal Builder separation in network and it's a consequence of Mev but it still happened where we had this sidecar software come

in named Mev boost people started using it like almost 90 percent of all blocks on the ethereum network are built using this um using this uh kind of uh Mev booth software and a lot of the relayers at the beginning were censoring right and then we we brought that down because ethereum as a community came together and worked to bring it down but if we didn't then you could see that okay well 80 of the the network at any time could censor anything right and that erodes ethereum's credible neutrality and it's an essentially resistant properties uh alone there so you see how there are certain things at every level that can affect this but I think that not uh burning the eighth and distributing it

to I guess like public goods or something like that uh would be would be really weird right I think that it would introduce such a a broken layer to ethereum and it would lead to a lot of bad consequences over the long term so hopefully that expands on on my comment there for those of you who may have seen it and wanted more information on that all right moving on to a tweet from Patrick McCory who now works at arbitrim I've spoken about him a bunch on the rifle before he writes a lot of great blog posts about layer twos well he put out a tweet where he said ethereum and the ethereum foundation provided the time space and money for the community to learn how to scale blockchain systems it'll soon be time for Roll-Ups to take care of ethereum and support the next

set of innovations that brings defy to the mainstream audience and he tweeted out this picture of the Teenage Mutant Ninja Turtles and their Mentor I'm sure you've seen this picture where their babies and the mentor his ethereum um and then I forgot to put in the mentor's name and they're like the layer two solutions and then they grow up and they help the mentor along uh when they're all grown up that's exactly what has been the philosophy of ethereum and this is a philosophy that's been set by the ethereum foundation for quite a while now and that's the philosophy of subtraction where essentially the ethereum foundation wants to be as as little Hands-On as possible on the protocol and wants to fund and let the extra protocol teams and everyone building on the protocol uh flourish and

that's exactly what they've done with layer 2 Solutions and with Roll-Ups we had all of these people come together and say okay how do we scale ethereum the ethereum foundation didn't say this is how we're scaling ethereum right it didn't say this is the roadmap that you have to follow this is the only things that we are funding blah blah right no they said okay well uh you know come to us if you want funding with the solutions and we may or may not fund you and then people started Building Solutions outside of the ethereum foundation funding or not and the community came together and said wow okay these roll-up things are really cool they really work they you know plasma wasn't exactly something that that worked very well uh but what evolved from plasma was Roll-Ups and now we have like different

types of Roll-Ups different flavors we have like layer threes you have all this stuff happening and that's because ethereum has an ecosystem and the the fear of foundation allowed these things to Blossom outside of any kind of centralized control and it goes back to that bizarre model that I've talked about instead of that Cathedral model where essentially a bizarre is a chaotic place right like if you've ever been in a in a country where they have like a Marketplace that is a bizarre model where there's just stalls everywhere there's no real kind of um I guess like organization to it there's no uh you know there's no signage nothing like that everyone's just set up their shop wherever they could find a seat and you can go there and you can buy you can sell uh maybe to some to some merchants and they're all there whereas with a

kind of Cathedral model of uh I mean the cathedral model obvious obviously takes inspiration from kind of like the top-down I guess like religious models where you have like the you know what one person at the top then you have people on the knee team and then underneath them underneath them and so on and so forth It's like a hierarchy essentially now in a in in normal businesses in some of the business because the biggest businesses in the world right they are not bizarre right they are they are hierarchy they're very heavily controlled they take Apple for example there is a clear hierarchy there right um or you know yes all the Apple Stores exist in different parts of the world but they all feed up to to Tim Cook the CEO right now all fit up to the board and the executives whereas in a bizarre

model there is no board there is no Executives there there is no control here there it's just a flat kind of organization and that's exactly what the ethereum ecosystem has tried to cultivate that flat organization where everyone can come together and build and then you come to consensus as an ecosystem on what is actually valuable and what is not valuable you're not told what is valuable you're not told what's not valuable you can work on whenever you whatever you want and it's it's kind of the marketplace of ideas you get funded if the idea is good you don't get funding if the idea is bad maybe you do get funding if it's bad and then later on it turns out to be bad and no one wants to fund you anymore if you went to it to to investors today and said that you wanted to build a

if you are plasma scaling solution you probably wouldn't get much money for that um and it's funny on that note I spoke about a project that I funded the other day um uh well maybe a couple weeks ago now that he's doing like a plasma roll-up hybrid that's a net new kind of construction there but if you were just trying to raise for something old that everyone has kind of agreed on that doesn't really work at scale like plasma you probably wouldn't uh wouldn't raise money for it we wouldn't raise nearly as much money as you would building something else and that's that kind of marketplace of uh of ideas there so on the project by the way I forgot to mention the name is is intermax that I was just talking about that plasma kind of roll-up hybrid there but that's exactly what the ethereum ecosystem has

cultivated and I just figured that was worth talking to because it's great to see that and it's great to see all the success that all these Solutions are currently having we'll continue to have uh into the future and I can't wait to see ethereum scale like we've all wanted to see it uh scale for such a long time now all right speaking of layer twos op Labs put out a tweet saying in February core developers from the optimism Collective gathered in person to dive deep into everything that needs to happen to achieve technical decentralization of the op stack and this blog post covers all the exciting plans um so this is basically uh the op lapses and I guess like the optimism ecosystems plan to decentralize the full op stack including the op main net or the

optimistic um ethereum Network that we all know and love today so basically uh this has been something that I think a lot of people have been hammering on about with all of the layer twos you know when are you going to remove your multi-cigs when you're going to remove your governance councils when are you going to take the training wheels off when are you going to make it Priceless when you're going to have fraud proofs you know when are you when is everyone going to be able to run a validator on a sequence Zone all that sorts of stuff well it's a progressive approach here and I've talked to this a lot in the past I'm not going to re rehash myself here but it is a progressive path and that's exactly what P Labs is talking about in this post and in their Twitter

thread which I'll link in the YouTube description below for you to check out highly recommend reading it but this is the end state right no multi-cigs no admin Keys No governance councils right fully governed by Adele uh you know with on-chain voting and all that sorts of stuff there if anyone able to permissionlessly run a validator run a sequencer run approver run any part of the stack right that and forward proofs and all that sorts of stuff that is the end state that we need to get to now to get to there is going to take a long time as I've stated before it's not going to happen overnight but layer twos have a much much easier time of decentralizing than layer ones for a lot of the reasons that I've explained before but the number one reason in my

mind is that one of n trust assumption what you only need one honest sequencer on the entire layer 2 Network for you to get your transactions included and even in a world where all the sequences are censoring you or not are refusing to process your transactions you could still with a properly constructed escape hatch at layer one you could still do the transaction at layer one and remove your your funds or move your funds around and do whatever else so taking that lens and and kind of um uh looking at it from that point of view uh yeah that's a much easier approach there but uh but yeah you can go give oplabs's blog post to read for yourself to check out what they're about I'll link it in the YouTube description below all right moving on to an update from

eigenlayer so they put out a tweak thread saying eigenlayer stage one mainnet is set to launch soon bringing restaking to eat stakers and fueling Innovation for avs's this blog post this this post explains benefits of restaking early and to express interest in areas taking early you can fill out this form here so yeah there's a blog post TR there's a tweet thread everything I believe yeah I read it here so apparently the people who restaged early uh will get you ahead uh in the eigenlayer ecosystem is what they say here now I don't know exactly what that means and you guys know I'm an investor in eigenlayer but uh you know people are going to read that and they're going to think airdrop right that's that's that's the first thing I thought of I'm just like and and just because I'm an

investor doesn't mean I have any special uh Insight here I don't know if there's going to be an airdrop I don't know if there's going to be anything really but reading that I was just like get you ahead in the eigenlay ecosystem okay I mean on the cynical side it does because it means you don't have to wait around in any kind of cues or any kind of gating you get to be first through the door but to to me it also sounds like a kind of potential airdrop opportunity I don't know that's just something that I that I um I thought of now uh people that still have a 0x00 withdrawal are credential um can point their validators to eigenlayer contracts right now so you don't actually need to go through the withdrawal queue and then restate again you can just point your validators to

eigenlayer's contracts right now if you wanted to which is which is actually pretty cool and I believe there's like 20 or something of the network still in 0x00 so if that's you this might be something that you're interested in there um uh but yeah all the resources are available in this Twitter thread as well as the blog post as I said you can go check that out but eigenlayer is moving really really quickly here which is awesome to see as I've said before there's been a lot of criticism of eigenlayer over the over the past I guess like 12 months since it's become a popular talking point there is a lot of valid criticism but I I think I what I said and what I still stand by is that we need to see eigenlayer live on mainnet we need to see it playing out in

the real world with real world economic incentives at play uh and see how it all shakes out before we can draw any kind of conclusions because this is the first thing of its kind at this kind of scale and it's going to tell us a lot about how I guess the stakers on ethereum are going to behave when these other incentives come along because this is going to inform a lot of other projects that that get built around staking um and it's going to show us what the real value prop of eigenlayer is and what people actually care about and the strength of the validators that sign up for eigenlayer like are these validators actually doing their duties or their extra duties how many of them get slashed on eigenlayer and just to remind you how it's getting slashed on eigen layout doesn't mean that you're slashed

on ethereum the way it works is that you'd be slashed on eigen layer and then eigenlayer has your withdrawal credentials so it would withdraw your validator it will take the eth that that you owe it and then um then the Earth would go the rest of the Earth would go back to you but it doesn't actually get you slashed on the ethereum protocol itself I think that's a very important point that I think people need to be aware of because that's one point of fun that I've seen that people say oh if eigenlayer slashes you know 30 of the theory Network then that's going to be really bad for ethereum security it's like no no no it doesn't slash the ethereum validators on ethereum it slashes them on eigenlayer and then pews them up for withdrawal now because of the withdrawal queue we have an orderly

unwinding in that case which means that it's not going to pose a a major security risk to the ethereum beacon chain because there's that orderly exit with the withdrawal queue they still have to go through the queue that you can't skip the queue now of course there can be derivative products built on top of that that allow you to skip the queue but that still doesn't matter to the ethereum network that is an economic derivative that is not a protein protocol derivative that is issued to you by the protocol it's issued on top of the the on top of ethereum by a project running smart contracts obviously and there are certain risks associated with that so I just thought that was a important Point uh but yeah you can go check this out for yourself I'll link it in the YouTube description below I finally here I just wanted to give a

shout out to ingonyama they have their registration now open for the ingonyama CTF you can sign and CTF who's uh Capture the Flag it's basically uh uh it's kind of a a thing that that's used in cyber security uh I guess like ecosystem but has kind of come over to the ZK ecosystem or the ethereum ecosystem here which basically is a competition with teams uh trying to complete or capture the flag of these these various tasks uh as fast as possible and beat other teams here so you'll be challenging your knowledge of ZK cryptography hacking skills and problem solving so you can go check this out at ingonyama.ctfd.io and I'll also link this in the YouTube description below for you to check out and just the disclaimer again I'm an investor in

ingonyami yeah so just uh I just wanted to shout this out uh not not only because I'm an investor just because I think it's interesting and I think that you should get involved if this is something that interests you anyway on that note that's going to be it for today thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe newsletter join the Disco Channel and I'll catch you all tomorrow thanks everyone