Merge updates, Locke introduced and more - The Daily Gwei Refuel #318 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the daily great refuel where we cap the latest news in the ethereum ecosystem i'm your host anthony sosano and today's the 18th of february 2022 all right everyone let's get into it so uh jesse powell the co-founder and ceo of kraken had a really great great tweet today uh following on from i guess like his parent tweet here where he was kind of making fun of what's going on in canada right now with the kind of i guess like bank accounts being frozen and all that sort of stuff there but he was replying to someone and this person asked him is it possible kraken will be put in a position where they are told to freeze assets by police without judicial consent and uh and you will probably comply and then jesse uh kind of like replies by saying 100 yes

it has and will happen and 100 yes will be forced to comply if you're worried about it don't keep your funds with any centralized regulated custodian we cannot protect you get your coins cash out and only trade p2p i thought this was like a very very cool thing for jesse to say considering that he is a centralized exchange operator and people having their funds on his exchange and trading on his exchange is how he makes money right and how his company makes money so he's basically encouraging people to uh get off his exchange and go trade somewhere else in a peer-to-peer environment such as on a decentralized exchange now this as i mentioned here is pretty based like i i really like that he said this but i think if we kind of look deeper here and kind of like uh deeper into what he's saying he's

basically saying not your keys not your crypto which is which is essentially uh you know the mantra of crypto it's been encrypted for a while now where if you're storing any funds on a centralized exchange they are not your funds like they are the centralized exchanges funds you have an iou the centralized exchange has basically said to you hey you know you have this balance with us we will uh honor that in under normal circumstances but there is no guarantee that you're going to get those funds out now those funds could be stolen in a hack those funds could be confiscated by law enforcement uh those funds could be uh just lost because of negligence right on on the centralized exchanges behalf there's lots of different ways those funds can go missing so that's why i've always encouraged everyone if they feel comfortable doing so to get their coins

off centralized exchanges and into their own wallet especially if it is a material amount uh like if a material amount of your net worth so to speak so you know if 90 of your net worth is on a centralized exchange as crypto maybe you should reduce that right maybe you don't withdraw all of it to cold storage but you should reduce that risk considerably and you know you might be thinking to yourself well i don't do anything wrong like i don't you know do any kind of money laundering i don't do any criminal activities but i i don't think that's the point i think the point is that there are things that i guess like the the funds can be frozen for like any reason and it doesn't even matter like your funds could be frozen because the tax office suspects you of tax fraud for

example even if you've done nothing wrong uh there could be a process where your funds get frozen because of that and you've got no recourse in that kind of um environment you just basically have to do what the authorities tell you to do so i mean this is exactly why we're building all this sort of stuff in the first place we're not building this stuff just to you know uh spin up ponzis and have a bit of fun making some money we're building this decentralized finance infrastructure to stop this from happening because no one should have the unilateral power or no entity should have the unilateral power to cut you off from the financial system with i guess basically a push of a button like that is way too much power for any one personal entity to have and that is the found you know as i said the

foundation of why we're building this sort of stuff is we want to reject that uh we want to reject that kind of like world we don't want to be part of that anymore we want to opt out of the traditional finance system and i definitely uh keep you know my my funds off exchanges i don't keep any material amount on a centralized exchange yes i have to use them to go in and out of fiat that's just the way it is uh and yes i have fear in a bank account for taxes and things like that but look there are certain reasons you have to keep kind of like money and with centralized custodians and centralized kind of like places and that's all kind of like fine if if that's the case but as i said if you feel comfortable uh doing so you should self custody and you

should also just use decentralized exchanges instead of going to centralized exchanges to do things and for the most part you can use d5 for pretty much everything these days except cashing in and out of fit of course i mean you can technically use it but you're still going through centralized um third parties there's no way to do decentralized fiat on an off-ramping i mean the closest you'll get is doing like peer-to-peer cash sales in real life which are i guess wrought with scams like i mean the the thing is is that like there's no protection from like a cash sale like you could go somewhere meet up with someone they could bring a couple of buddies that are hiding around the corner you give them the cash and you're expecting them to send you the crypto and they just run off of the cash like

obviously that's uh not not a great way to do things and it's it's a very high chance of kind of like scams and fraud in that environment and you've really got no recourse from that so i think other than going in and out of fear you should be able to do pretty much everything you want to do on within d5 at this stage yes of course you know some of the things the costs are quite high because you can still only do it at layer one but we're rolling out the layer two ecosystem to obviously rectify that there but i think if you have china just funds on exchanges doing nothing uh they're just like your cold storage don't use exchanges as cold storage get a hardware wallet like i've been a big proponent of the grid plus lattice before it's a it's an awesome device

obviously you can go with other hybrid bolts as well like the ledger uh nano or the trezor or there's a there's a few others out there honestly i've only ever used uh the the lattice and ledger i haven't really used trezor and the trezor people seem to be kind of like more on the bitcoiner side of things so they're kind of like slow to add support for ethereum stuff and all that sort of stuff there so yeah you can't i don't think you can go wrong with with ledger or or a lattice i personally kind of like prefer the lightest i think they're uh you know they're much more aligned with i guess like the web 3 ethereum ethos than than ledger is and obviously there was that ledger leak a while ago so kind of bad taste in people's mouths of course but you know there's other

ways to secure assets too but those are the the most user-friendly ways like you can do all sorts of things like the funny thing is as long as you have the private key and you can do anything you want with all the seed phrase like you could split up the seed phrase into multiple different pieces give it to friends and family you can make your own cipher you can hide it in different things like you can go crazy with securing your assets you can do um shamir secret sharing you can do uh a bunch of kind of like encryption things i mean there's so much you can do you can do air gap to pcs but this is getting like super technical that's why these hardware wallets exist to just simplify this whole process for you and allow you to do this without having to

go through all the complex processes so yeah but anyway i think i'm gonna i'm gonna leave that one there for today but i just felt it was really cool that jesse kind of like called this out here and just a reminder to everyone that not your keys not your coins your just because you have an account balance on a centralized exchange does not mean that centralized exchange can will and always will honor that and let you withdraw to your own wallet uh at all times there are going to be times that they're going to be forced to freeze your assets as i said and there are going to be times when they lose assets or get hacked that's just the name of the game when it comes in crypto and that's why i always encourage people not to keep material amounts on centralized exchanges if

possible i say if possible because if you don't feel comfortable keeping uh you know securing your own funds and you feel more comfortable just leaving it leaving it on a centralized exchange that's totally fine guys i'm not going to shame you for that but do realize you're taking risk by doing that um you know the risk may be less to you than the risk of kind of trying to self-custody but the risk is is still there i believe all right so parathosh today put out a tweet that merge devnet 4 is now live so they're still working on getting the tooling links up or the configs can be found at this github repository now what is this well this is the test net that is meant as a dress rehearsal and a precursor to the kiln test net so merge devnet 4 is not meant as a replacement

for concergi um but you know please wait for the kill and test net announcement to migrate away from kimsugi so this is really i guess what the devs and and kind of like researchers are working on right now obviously getting all this sort of stuff set up for the next big merge test net which is killing which is obviously coming off after kimsugi this is all i guess like working in the background there's a meta spec for killing happening right now i mean there is so much going on guys like it's just absolutely crazy how much is going on right now with the merged stuff it's moving at a lightning lightning pace i feel like i mean i'm i'm getting more and more optimistic about that june day like i i it's obviously happening this year but i'm getting more and more optimistic about that that kind of like june date

um and i'm getting more and more optimistic about uh the kind of like developers and researchers and their confidence around it um that that's really encouraging to see and you know parathos says here the underlying power test net had uh had multiple forks so different beacon nodes detected different terminal block hashes the chains however are great on a block hash and moved head as expected the chain is finalizing and we had no downtime with zero intervention and great test overall so the tests are going well as well i mean this is for the merged devnet for this is just awesome guys like i i am so so happy to see this moving along so nicely i'm so happy to see that there's been no major bugs yet i mean it's always funny because sometimes you think ah if there's been no major bugs does that mean like we've missed something

because there's always that risk as well you're like oh you know it can't be it's too good to be true that we got it this perfect that it's running this perfectly off the bat but sometimes that just happens and there have been bugs obviously with with the merch test nets so far but i don't think there's been any major show stopper bugs i think the biggest thing was um the uh the newly kind of i guess like formulated attacks on ethereum's proof of stake but i think that wasn't from the merge test nets that was already known from a while ago and they ended up being patched so i don't even think that would classify something to do with the merge to be honest but i think they needed to be patched before the merge would go through of course so i guess it all intertwines at the end of the day

but yeah just uh i guess like a little update on the merge for you guys today but i will of course keep you all updated on all of that uh as as i get more updates so sequoia capital has announced that they're launching a five to six hundred million dollar crypto fund to invest in tokens now this isn't tokens as in proceed rounds pre-seed rounds series a like private rounds right this is actually them investing five to six hundred million dollars in tokens on the public market that's why i'm highlighting this because obviously a fund raising a few hundred million dollars is you know a dime a dozen these days it's nothing special but i think them you know committing to buying tokens or liquid tokens i guess the ones on the public markets with these with this amount of money actually signals or

at least i guess like signals to the to the wider crypto market that hey like there are big name investors out there that think that uh there's plenty of opportunity in the public market still in the liquid market it's not just all about getting into the seed rounds getting into the private rounds and having the opportunity there there's plenty of opportunity left in the liquid markets and look they're right i mean i've said to you guys before like maybe not right now because i guess right now um the market's kind of quiet but generally over the long term there is still so many things out there that i believe to be not necessarily undervalued so to speak but like a good buy for the long term now i'm not going to tell you what those are i'm not going because i mean honestly i i don't have any kind of like

special insight obviously like i i'm very long on eighth but i think that if you do the research you do the homework and you look into these things there are plenty of liquid tokens that are out there um and that you can buy that will give you a good return over the coming years and i think that's what sequoia sees here as well they're obviously still going to be doing their private investments and all that sort of stuff i mean that that game for them is kind of like a a pretty pretty safe one because at the end of the day if they get into rounds that the valuations are really cheap and then it ends up being a really successful product by the time it tokenizes they can make a return this is what all the vcs and funds do anyway i mean i'm sure you guys have seen this

play out plenty of times at this point um but yeah them investing in public markets is really cool and something different for once uh i wish more kind of like vcs and and funds did this i don't think sequoia is the first kind of like vco fund to do this there have been some out there i mean a lot of the funds actually do public liquid um kind of like investing um uh but the thing is is that this tequila is more like a vc and i've explained the difference between vcs and hedge funds before but the line is blurring there as well it feels like they're kind of like both doing a bit of a bit of both and there's not really a delineation between vcs and funds anymore but um i think the way i still delineate them is that visas have like a much longer

time horizon of like five to ten years whereas funds are usually a few years but even in that kind of respect how can you have a five to ten year time horizon in crypto on anything but really b2c and eth i think those are the only two assets you can actually have a five to ten year time horizon uh based thesis on because think about even just like five years ago what was like the hottest thing within crypto uh in 2017 this was 2017 i guess the hottest thing in crypto besides eth was all the icos pretty much all of them are basically worth zero or went down 90 plus percent how can you have a five to ten year thesis on ico tokens back from back then you can't there are a few big winners of course but your thesis was then not based on uh kind of like those tokens

your thesis was based on things like d5 like if you had bought rve early on um you know in 2018 not necessarily 2017 but in 2010 you did very well over the longer term you know snx same deal bunch of others out there same deal but it's just the industry changes way too quickly there are gains that can be made much quicker than five to ten years and you know vc like gains like 100 x plus uh kind of gains there so that's why i think the lines are blurring where vcs are having much shorter time frames also because things go public in a much shorter time frame like uh free or tokenized i guess tokenizing is crypto's version of going public but in the in the um i guess like traditional markets or in the traditional startup world i think the last time i checked it was

an average of about seven years from uh seed funding or i guess like first funding to ipo it's not nothing is like seven years from funding to token in crypto like not even close most projects tokenized within 12 months of of um initial fundraising you know uh 12 to 24 months really covers the probably the 99 well not 99 maybe 90 plus percent of projects uh in this kind of like space so none of them get anywhere close to seven years uh and i think you know i don't really have an opinion on whether that's a good or bad thing i think that uh the timing in crypto is always a funny thing because if you release your token in a bull market well then your token is going to do really well but if you release it in a bear market it's going

to do very very poorly um it might spike up and then go you know and then trend down but i think that during the kind of quieter markets and during the bear markets this is when things can get irrational and where you can get scoop up the liquid tokens on public markets and potentially make that 100x on some of them like i don't know what which one's going to do that to be honest i don't really pay much attention to the public markets these days besides eth they're very noisy like don't get me wrong this isn't an easy thing to do but the opportunities are there if you want to grind if you want to make it so to speak if you've only got a few thousand dollars to play with then this is what you should be doing you should be doing this deep research looking into these

things um you know making sure that you can position position yourself accordingly and just kind of like sit on the positions for a while like you're not going to be able to especially in this market buy something and then a few days later make a ton of money on it the only place where that was still happening up until recently was nfts and that basically was just even harder to pick so i think having the long-term thesis on specific sectors is always um is always promising as well but having a long-term thesis on any one asset besides maybe ethan bitcoin i mean i say bitcoin because you can kind of like easily reason about btc as a long-term thesis there but uh eth obviously is very easy to reason about as well but just look at everything else look at even the top ten like could you give me

for any of the ethereum communities out there could you give me a five to ten year this is like would you be would you be comfortable holding any of these ethereal quote-unquote ethereum killers like solana avalanche um tara i guess kind of uh a bunch of the others out there like phantom would you be comfortable holding those things for five to ten years no i don't think you would like i'm not gonna speak for you but like nine times out of ten i think most people would say no they wouldn't feel comfortable doing that because not only are these things uh part of like their own hype cycles but they're competing with like as i've said the ethereum layer two ecosystem there's so many headwinds coming for them and a lot of them are just unnecessary so i think from that point of view uh like

for me personally there is nothing in this ecosystem except maybe eighth uh like except definitely eighth not maybe i should say uh that i would hold for five to ten years or feel comfortable holding for five to ten years uh maybe a few of the l2 project tokens actually i would i would probably feel comfortable with but again like eighth is like number one and then second place is like a distant second in terms of kind of like holding there but anyway not investment advice as usual but just something for you guys to to think about and uh just i guess like my way of thinking about it as well there all right so uh the coindesk has this article out today that the graph has a new 205 million ecosystem fund backed by multi-coin capital uh reciprocal

ventures and uh digital currency group and others which aims to accelerate the development of key projects in the data index indexing networks ecosystem so there's as i said there's this article on coindesk that you can go check out for yourself if you want to read more information about this and see who's involved but this is really cool i mean as you guys know the graph powers a lot of the crypto ecosystem especially a lot of the d5 ecosystem their core web 3 infrastructure without the graph you wouldn't be able to get a lot of your fancy kind of like data on the front end so it's very very important that we have things like this and you know there are the graphic what i like about the graph is that they're a project that really gets the web 3 vision and gets to decentralized vision like the founder of the graph

geneve he really cares about decentralizing absolutely everything not just the protocol contracts and the smart contracts but the front ends as well and you don't decentralize the front end by having centralized data sources for those front ends so the graph is trying to decentralize out that querying for that for that data so that anyone can kind of like tap into that across the graph nodes and it doesn't become any kind of like central point of failure here so that's you know really exciting to see that they've got a 25 million dollar fund that's kind of i guess um i'm going to be involved now and oh it's just some fun that's going to be involved uh they also have obviously a token they've got like token funds going on i mean they've got plenty of money flying around here but uh it's just really cool to see more and more

money pouring into this because this is definitely needed in the crypto ecosystem so euler on twitter today announced that they have launched their unisop oracle oracle attack simulator so you can go check it out or try it out at oracle.euler.finance you can read more about it on this blog post which i'll link in the youtube description so what this tool allows you to do is allows users to simulate and quantify attack risks on unisop v3 t wipe price oracles now t-op stands for time weighted average price now what does this mean in plain english well basically uh the euler taps into a unisop v3 tiwa price oracles uh for different kind of like markets on there on their money market and what a t-op is is basically takes a i mean a self-explanatory right like a

time weighted average price of an asset so it waits the kind of i guess um that time and then it gets like an average price over time um and even you know in some cases based on on the trading volume as well and kind of like spits that out so instead of just taking one price point in one point of time like say you know eight is three thousand dollars instead of just taking eighth at three thousand dollars it averages it out over a certain period of time and then takes the average of all the prices that ether seen in that time and that's supposed to make um the oracle more resistant to manipulation right and supposed to make it uh safer to kind of like use as an oracle so if you want to kind of get involved with this and try to attack it and try to break it and you

know try to fool it be sure to do so i mean this is actually really cool because you'll be helping the oil team out with this you'd be helping them out test out their oracle make sure that it really is resistant to attack and really does what it what it says is going to do because what oil wants to do is they want to use these these oracles in order to be uh to make it so that anyone can spin up any kind of like market with any assets or any money market with any asset on the euler platform so if this sounds like something that's up your alley definitely go check it out i'll link it in the youtube description below so i don't know i don't know if i say this is lock protocol or locky protocol i'm just going to say lock protocol from

now on but lock protocol was introduced today so what is it well will price one of the people who worked on lock protocol has given a nice tldr for us here so what it is is it's a fair and efficient token distribution unsophisticated users will not get wrecked it's mav resistant no gas wars and composable af so basically it's a generalized platform that enables protocol facilitated token distribution it is a token sale platform in plain english essentially so what as will price says here what are they're hoping for is they're hoping that this is a way to fairly and efficiently distribute tokens um and make it so that people don't you know just don't get wrecked it's me resistant all that really cool stuff and of course no gas wars so if you want to know how they all do this you can definitely read more details

about it in this in this blog post here but they implement what's something called streaming auctions which is an efficient and equitable price discovery mechanism that can be viewed as a special case of a t-wam which was something that the paradigm research team posted about here which you can find a link to in this blog post um but basically this is a visualization of how it works you know will price has it here so i guess you kind of got the tokens on the right-hand side here and people get rewarded for it um and you can kind of like just see it in the video here obviously if you're listening you might be able to see the video but it'll be linked in the youtube description and you can see like alice uh has her 8th deposits being kind of like drained and getting these governor

awards over time so this is cool i mean look i think token sales are hard to do i think fair token sales are even harder to do and i think fair token sales where the price doesn't go bananas and you know everyone doesn't get wrecked is really really hard to do so i'm hoping that this is kind of like a solution to that i'm hoping this actually works as advertised we're going to have to see how kind of like this plays out with in a real kind of um i guess real life scenario it hasn't been launched yet uh but i welcome any of these sorts of things because we've all seen like how my how many token sales have just been so poorly run like there's been a few successful ones with um the lbp from balancer which is pretty cool but a lot

of them turn into gas wards a lot of them get maved like to hell a lot of them end up kind of pumping and dumping like pretty pretty hard and a lot of them are basically just whale games we don't want that like distributing a token is already hard enough and if you're trying to do a token sale where you want to distribute it fairly it becomes just just i mean nightmare scenario for projects because how many times have projects basically died because their tokens did poorly even though the product is good so so many guys like i i think i don't think people realize how much a token how much of a part a token plays uh in a project's life in this ecosystem because a token is basically a way to get free publicity free marketing or maybe not free but like you know a

marketing publicity building up a community building up an army but if the token is not appreciating in price and instead he's deep depreciating and is losing lots of value over time the community that you're able to cultivate is gonna go away they're gonna they're not gonna hang around like if especially if they're losing a lot of money if say you launch a token and it goes down like 50 in a month i mean you're gonna lose most of the quote unquote community members that you had gotten now this is this happens for everything this isn't just for new tokens i mean this happened for eighth like eighth had a massive run in 2017 10 bucks to 1400 bucks in like a year then it dumped 94 to 80 bucks in another year look i was i was there we went from like everyone everywhere talking about eth to

basically only a handful of us sticking around so this doesn't just happen to these random tokens in the ecosystem it happens to even the biggest ones out there and it's happened right now i mean look at how quiet the ecosystem is right now and the prices haven't even gone down that much like you know relatively like ethies what three thousand dollars down from five 000. we're not even down 50 like come on guys and the ecosystem is basically like super quiet right now the markets are super quiet but uh you know that's that it is what it is that's how this ecosystem has always worked and how it will probably always work or at least for the foreseeable future in that tokens drive a lot of activity i mean the markets drive a lot of activity the prices of things drive a lot of activity and if all your token

does is wreck everyone that buys it and is down only you're not going to have a great community and the perfect example of this actually now that i think about it is zcash zcash has been down only since day one and it's day one was a long time ago i'm pretty sure it launched just after ethereum i think in 2016. that's like six coming up on six years ago now guys that token has done nothing positive for anyone like the project awesome zcash team awesome researchers awesome they've you know they've they've um been involved with the cryptography um related stuff like zero knowledge proofs zk um a stark uh snark sorry i should say all that sort of stuff there they've been heavily involved in that they've done a lot of great work but like at the

end of the day the token has done really poorly so they don't really have a big community they don't have any attention on them the only time anyone ever brings up the project is to talk about how badly the token has done i mean how often do you hear me talk about z cash on the refuel and i'm talking about it right now because i'm losing it as an example of what not to do with a token um and the reason why zcash was down only was because they didn't do a token sale i don't think they did a token sale i wasn't around back then but i don't believe they did but they had like a really high inflation at the start and that their own proof of work still they have um and because of that they have miners constantly dumping uh the the

coin and also even though i believe privacy obviously is a huge thing i don't think you need a separate blockchain for privacy i don't think uh you know we should just have like one chain where everyone has to like own this zcash asset uh in order to have privacy because look at what happens on ethereum tornado cache exists and you can kind of like uh i get a user to mix ether and some other kind of like tokens out there we have aztec protocol doing privacy at layer 2 you're going to be able to basically send any kind of token and ethe in in a private way and kind of like wrap it and shield it like you would in zcash so i don't really see the point of zcash in an ethereum kind of like world there even though the tech is is sound and the tech is good and i

think that's why and another reason why the zcash price is kind of like not done very well over to say the least over the longer term but uh yeah anyway a little bit sidetracked there but i think it's always good to understand how these kind of like token sales work and why a lot of them end up being really poorly run so definitely check out lock protocol here if you want to learn their blog posts if you want to learn more about their protocol and hoping to see them launch soon all right so last up here just an interesting tweet from greg vardy who basically has this kind of like i guess image and he's captured it with dye transpiled from solidity to cairo with warp 2.0 versus its handwritten cairo counterpart efficiency is almost exactly the same and the transpiled contract is 10 kilobytes smaller than the native one

now quick refresher here i've told you guys before that nethermind has been working on a transpiler for uh developers to be able to just instantly port their solidity code to cairo which is the language that is being used on stark net so using warp 2.0 uh what greg is saying here is that the efficiency is almost exactly the same between the solidity version and the cairo version and the transpiled contract which is the cairo version is actually 10 kilobytes smaller than the native one that's really really cool and this is talking about the diet contract that's actually amazing that they've been able to achieve this this means that you don't need to write your apps in cairo again you don't need to write you know from the ground up you can basically just

um kind of like transpile it across probably want to get it audited again or do some code reviews and make sure everything's running smoothly and and do some test nets and things like that but this cuts down a lot of development time for people to move to stark net or to kind of like i guess like deploy their apps to stark in it could you imagine transpiling the whole maker system over or like part of like the wormhole system that they want to do or transpiring the whole kind of like rba system over unisop for example and not having to rewrite everything that'd be super cool and i think that's the reality we're kind of like uh barreling down towards so i just wanted to highlight that because i thought it was super interesting but i think on that note it's gonna be it for today so thank

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 next week thanks everyone