The New Era of Bitcoin Powered By Starknet

Transcript

what's going on guys welcome to the rollup today's episode is with Ellie Ben San he is the founder and CEO of starkware this is the team that's building Stark net and they're know for their Cairo BM and Stark verifier that is a ZK rollup that sends Stark proofs back to ethereum L1 and maybe soon Bitcoin L1 starkware has given a million dooll Grant to the development of research behind op cat this is the op code in Bitcoin it's been controversial but we are seeing lots of traction for it in today's episode we talked with Ellie about how they were able to figure

out a stark verifier on bitcoin using opcat this enables a myriad of new features and advantages coming to the world of Bitcoin l2s Bitcoin rollups I'm very very excited to see how this plays out and to today we got a chance to talk with Ellie about all the exciting research that's happening with starnet and opcat first word from our sponsors enjoy mantel is a layer to blockchain with one of the biggest onchain treasuries in all of crypto and they have a 100 day campaign called metamorphosis live now what this is is it is a campaign for their liquid staked eth token and eth as well as their upcoming liquid reaking token C at e

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modular and fractal scaling in mind fractal scaling is based on the mandal BR set of fractal images and it explains how l2s become l3s and the entire app chain life cycle goes through its Evolution the FRX ecosystem is made of some of the top builders in the space and has stemmed from its OG days of the frax stable coin it is now in the LST space the LRT space and this frax L2 joins the existing Suite of fra products including fra Swap and frax lend you can see frax faery the bridge to go from any

chain gain arbitrum optimism or main net into the fra main net Bridge your tokens and bring your FRA assets into the fraxel ecosystem join today to get the best out of fraxel you are still early join today take part in our Expedition into the singularity what's going on guys welcome back to the rollup today we have an episode about scaling Bitcoin following our Bitcoin and Beyond content series that we endeavored on learned quite a bit and actually just recently at ECC had a chance to attend a couple of Bitcoin scaling events and thoroughly enjoyed that and unfortunately missed Bitcoin Nashville um but I heard a lot

of things including a Donald Trump speech which was somewhat interesting today we have Ellie from starkware uh I first did an interview with Ellie in Stark net CC H last year in Paris uh the Start Community has grown quite a bit and now kind of made one of the biggest technical announcements and moves I would say of this entire year by figuring out how to run verifiers using opcat bringing Stark net onto Bitcoin we're gonna talk all about that Rob good to see you as well um and I know that you are quite quite excited about this one yeah I I am because I think uh Bitcoin has been stagnant for a really long time I first got involved in crypto

uh through Bitcoin and now Bitcoin is changing in again and Bitcoin doesn't change very often so I think this is uh this is pretty episodical um and so I'm pretty I'm pretty stoked to talk to Ellie about all the things that are happening uh through Bitcoin and through starkware um we you know uh have talked a little bit prior to this podcast about kind of the background that our audience has and so yeah following up on bitcoin Nashville I didn't get a chance to attend uh but I was moderating a couple panels at ECC as well in Brussels and uh Ellie you know did you get a chance to attend Bitcoin Nashville if not like what's your feelings just kind of like looking at the state of Bitcoin these days yeah so unfortunately unfortunately I couldn't attend uh we had a few people

from our team attending but we haven't actually had the time or I hadn't had the time yet to debrief with them but of course um well the the largest um thing there is just the uh sort of uh shifting political winds around Bitcoin and these are both external wins of course you know the two presidential candidates uh now um embracing uh Bitcoin maybe the Democrats uh doing sort of a turnaround and embracing it and so on and of course Trump's uh Embrace of it um but what's maybe more consequential um is the um um internal debates going on in Bitcoin that are

basically revisiting and thinking about whether you know to allow again opcat you know this is this op code that was already introduced by Satoshi um back in the day and then removed so maybe bringing it back in this would be a tremendous uh news positive news for Bitcoin yeah I I'm really glad that you brought that up like the internal politics of Bitcoin because we heard from Tyler Whittle who's part of Tapo Wizards and he traced us through this like long and Winding Road of what it takes to get a bip approved um now opcat has a little bit more of a formalization about how it can get implemented into the Bitcoin code there's some Powers at that B that are supporting it um but

like from your perspective what what is the political landscape of Bitcoin nowadays and where does opcat fall into uh who is supporting it who's not supporting it you know what is the path to main net essentially for opcat I confess I'm that's not my field of expertise right I I mean I don't know Bitcoin politics and I'm not sure I know where opcat exactly lands and you know what are the forces for or against it I do trust people like um Andrew postra who whom I've known for probably more than a decade um and he's like this really solid sound uh Bitcoin researcher that a lot of people I think

there's a wide spectrum of approval for him as someone who's you you know in it for the right reasons and uh as a man of integrity another one is Ethan hailman um these are I think the two leading figures in the uh discourse today at least that I'm hearing on opcat and I think it's uh so I don't know much about the politics but uh I do have faith in some of these people that are um very smart and um you know their heart is in the right place when it comes to these discussions awesome I think we we ought to get into the technicals here pretty quickly but but first kind of what prompted that question maybe a better question is that starkware made uh I

believe it's uh I forget the exact figure but it was a significant commitment of of capital to funding some research with opcat so maybe a better question is how you know why did you choose to make that commitment in in support of opcat so um yes indeed we we announced that we're committing $1 million to a research fund uh details about the research search fund uh have just come out last week uh there's an independent committee that is headed by Andrew polstra and has a lot of uh you know people on both sides of the opcat debate and uh the idea that we had is that basically we would like to um you know help the Bitcoin research Community

um get more clarity on the pros and cons of opcat so that you know they decide it's it's in the end it's up to this amazing Community to decide whether it wants to turn it on in a soft Fork so our contribution you know we we are um Stark Maxis we are math Maxis we are you know blockchain Maxis and we'd like to see blockchain fulfill its Vision to the utmost uh uh degree and and for that to happen you you you could benefit from things like opcat and having Stark verifiers on bitcoin yeah I can't help I can't help myself anymore I just I need to ask how in the world did we get a

verifier running on bitcoin using opcat what magic have you guys done and maybe first you can un you can unpack the problem briefly for those who need a refresher or who are kind of new to this and then yeah how in the world did we get here okay so um first of all what is the problem um think of Bitcoin as this really really uh trustworthy computer um that that carries immense value right the whole world is operating and using and and watching it and contributing to it so it's like really safe and it you know um basically maintains value of over1 trillion dollar today which is an amazing achievement of

Satoshi and the other Visionaries that that jump started this amazing thing however as a computer it is more like one of those science calculators from you know a generation ago where you could do a bunch of things with them but not a lot you couldn't you know program Tetris or a game on them um so there are some things that you can do you can use them for some computation but not a lot okay now in particular you could not use them for doing something as complex as putting a stark verifier so you cannot have a validity roll up uh on them and so on and so forth now there's this uh if we think of it as Bitcoin as as running this science

calculator think of it uh of this of opcat as being you know one more button right that you're adding to the calculator that it can do one more thing and what is this one more thing it allows you to concatenate uh sort of to glue together two strings into one string and uh that's what Satoshi you know um added back in the day um you could see that the big danger with it is that suddenly well you could just keep on doubling strings and within a very small number of operations you could have this immense string that you just can't hold on your computer and it would crash so because of this reason Satoshi also uh took it out but of course there is a very simple way to stop that which

is basically to say well you can keep on you know concatenating strings but there's a limit whatever one kilobyte or one megabyte or whatever it is that that you can't go beyond that so I think uh that it's pretty safe to return back this op code this button that Satoshi had in mind and once you add this button you know it takes the Ingenuity of researchers like waying Chen and uh the folks here at starkware to figure out a way in order to put like this really lean and mean Cutting Edge verifier the stew verifier uh based on Circle stars and a whole bunch of math Innovations to just fit in inside uh Bitcoin block blocks and so from the perspective of

actually getting uh the Stu verifier to work with opcat um why why is is is this concatenation needed for uh the Stark verifier to actually uh provide value in in in in the sense of enabling actual scaling Solutions on top of Bitcoin why is it that that we that that the starkware team has came up with a solution which is relying on opcat versus kind of doing it in a different way or um implementing stock verifiers yeah with a different kind of road map well there are two parts to to using Starks within a rollup on bitcoin one is to have a stark verifier and the other is to maintain State over time because

the way you want to use uh star verifi to say okay a bunch of transactions have occurred off chain on Layer Two and thanks to the start proof we understand that the previous state can now be updated to a new state so there are two parts one is just you know this like decision can we can we can you know is the proof valid and that uh okay the other part is assuming that the proof is valid um can we update the state and what is the new state so Bitcoin without opcat has a very hard time um remembering and and updating and and figuring out what goes on with State

over time there's this one state which is the utxo state which is very much evolving all the time and isn't very good at maintaining State I mean that's you know that's a a feature not a bug in in the world of Bitcoin but if you do want to maintain State like you do on ethereum and you know remember that there are accounts and things happened in a certain way and remember this over time then uh the lack of opcat really limits you because you can't really talk about strings or data that is longer than whatever 32 bits so upcat is more needed for the uh State update part than it is for the Stark verifier but there as well a stark uh proof is you know is a few uh kilobytes long so you have to

sort of break it up into portions and if you have opcat it just becomes easier to deal with this large string and Par it and compute on it okay so we have opcat we understand that we need opcat well we don't have it yet but in a world that we do have opcat Stark net is now settling Stark proofs to uh Bitcoin and ethereum in some sort of simultaneous manner or some sort of manner and this is kind of the the Crux of the question here how do you settle a a rollup um right using Cairo VM so it's not even evm um but it's settling to two different layers at the same time and matching the state but

different user bases are all one kind of what's the vision for for for how this is going to work technically in a world post opcat okay so the vision is to have um one state or one global system that has let's say well at least three different types of data within it there is data that is let's say pure Bitcoin related which means that even if all of the stuff on ethereum crashes and disappears then you can still keep on using that with bit coin then you have a portion that is let's say pure eth let's call it the eth ma we have the Bitcoin Maxis uh you know dis or or space you have the eth Maxi space which is the same thing just with respect to ethereum and then you have I think the most

interesting space that I would guess captures most of humankind and I certainly sit there which is the um you know the blockchain lovers they love Bitcoin they love ethereum they actually trust both and many more and uh I think a lot of the interesting things will be happening there so now your question is how do you get the safety especially for the two uh two Maxi groups right um so there are several options there and like uh there's you know research yet to be done one solution is to basically say that you know you you between Mom and Dad you pick someone you love more and basically it means you have some order precedence you say if there is a contention or something uh you know the

two chains are arguing about something then we're always going to go with Mom or with Dad you know your preference and uh that's definitely a reasonable default um second thing is that sort of uh yeah no but but there are um suggestions there's this very nice research by um James prestwich about roll out and there are suggestions about how to do it without necessarily having a precedence order and we're still looking into that uh but I'm optimistic we'll figure out a way Everclear is pioneering the clearing layer the clearing layer can almost be thought of as splitwise when you go on a trip with friends but for the blockchain what I

mean by that is when users are sending cross chain messages there's often times fillers and solvers who have balances left on different chains that they need to rebalance and reset their positions this is where ever comes in ever is pioneering a collaborative approach to the chain of traction future and they are willing to work with interoperability Partners solvers and other providers in the space to build a interoperable and chain abstraction feature check out Everclear ever clear.org and welcome back to the up coent is solving the longterm data availability problem where a lot of the data availability providers today in the maer space when you post data to them

they actually only hold that data for about 12 to 16 days and then it's basically they can go into archive note or often times it's just kind of put away into the abyss and what coiling try to do is build this long-term data availability solution which can plug into some of these modular data availability providers and provide this longer term Perpetual data solution so what we try to think of this as is when you post transaction data onto Celestial or Veil or any of these moderate da Solutions or even ethereum coal is able to provide a longterm data storage and data availability platform for that data after the time period blockchains are Billboards not databases and you know we

need these providers in the space to be able to kind of hold on to the longterm data that is provided from these providers and these blockchain State this is where coent comes in they just had a nice Rebrand check them out on Twitter as well as the website thank you for being here hope you enjoy the rest of the show when it comes to different trans transactions settling on you know Bitcoin or ethereum um are these transactions on Stark net both going to use the native canonical data availability of Bitcoin and ethereum respectively or would there be a a different data availability layer for Bitcoin seeing as the performance is

slightly less capable than ethereum or kind of how are you thinking about that I think we're going to use the Vol which is anyways you know in design and we're roll it out meaning um what is the concept behind volution um the safest uh data is the rollup data that is actually maintained the state maintained on on the main chain and now in this case you will have like two main chains so you pick your one you know where you want your data that's the safest but it's also most expensive or you could go with any number of data availability solutions that are not layer one and then there's a trade-off they will be cheaper to use but less safe now and then you could have these interesting

things where maybe you know if you're a Bitcoin Maxi uh or you really you know you um trust Bitcoin more your rollup will be Bitcoin but in your volition Choice the data availability layer will maybe be the Blobs of ethereum right or it could be something completely different uh but basically we want to give the users choice they will pay differently for different data availability Solutions and so if users are choosing different security guarantees the user on a starnet uh that chooses Bitcoin might have significantly higher gas fees for example than a user that chooses ethereum as its priority

for sure and so when we're thinking about like the ways that uh Stark net derives its security assurances um a lot of times like we we think about like uh cost of corruption when we're thinking about you know whether or not a chain is secure if it can be 51% attacked and so in a way uh is Stark net inheriting both ethereum and Bitcoin security um security guarantees such that uh uh malicious actor would need 51% of of Bitcoin and ethereum combined or is it one or the other or is that question totally mute because Stark net is a cryptographic protocol that uses ZK

proofs and you would actually to uh maliciously D like verify or generate a ZK proof incorrectly well um the question is not mute it is just the what the the the ZK proofs do is they limit it scope meaning uh you can never um put the system in a state uh that is you know false or that you don't know how to reach it but what the ZK proofs don't prevent is the case of a double spend right where let's say you know you have one asset and on the Bitcoin side of things you sent it to Alice and on the ethereum side of things you sent it to Bob now both are valid transactions in their own right but uh together they don't uh you need

to know which way to go um it's a really good question I would like to say that you get the best of both worlds but I'm actually not sure that it's going to be this way and then it depends I talked about like you know three different modalities of it um and uh maybe for the middle ground those that like both ethereum and Bitcoin you can be as safe as uh the strongest of the two chains um but probably for the Bitcoin Maxis you'll be they want to be as you know they don't trust ethereum so they'll be as safe as Bitcoin and you want to have it also the other way on the ethereum side but I'll be honest

with you I do not know how to answer that question right now like what is the level of do you get the best of the security of Bitcoin or ethereum or do you get just one of them and for which parts of the universe that we're creating yeah I I mean I don't know how to answer it either so I'm I I realized that it's still early early research um and so I'm curious just kind of zooming out you know you guys have made strides and uh commitments to This research what is sort of the road map that you see for Stark net and op cat you know as far as kind of forecasting this out for the vision of settling to both both Bitcoin and ethereum is this like a month's thing is it a Year's thing like without I don't want to put you in a place where

you're projecting or predicting but you know what are some of the Domino effects that have to happen in order for Stark net to achieve its ultimate goals so for Stark net to achieve its ultimate goals we're definitely talking about years if not decades and we're certainly planning to be around for decades you know who knows maybe for centuries uh I mean I I won't be around for centuries but I hope Stark it does remain because what is a what is starnet about and what are blockchains about in the end uh I mean first of all let's recognize um that that whatever blockchains are today is not their you know goal and Mission right today a very small fraction of humanity uses them and they use them for things that you know my dad is not going to use them from for right so if we all

all on this call right and many of our listeners probably believe that there's much more to blockchains than we see today and what is this much more so this has to go with like what is the vision of of uh blockchains and it's also my vision and Stark Net's Vision which is that you know today uh when we inter when we interact in the digital world almost all of our actions and all of our assets are basically custody with others and we ask others to act on our behalf and these others are nation states and you know big tech companies and these big entities can confiscate our assets they can block us censor us they can mislead us and we have no recourse to

that at all and what is starkit's Vision Stark Net's vision is that we want to move to a world where Integrity is never assumed but rather upheld by all and is publicly verified which means that basically when you're doing Financial interactions when you're interacting with your bank or with your state it's not that they make promises and you're supposed to trust them the promises they make are baked into smart contracts or into protocols and those Protocols are actually run by others and they don't have a say on you know barring or censoring you or blocking you that's where we're heading and we want to get there with all of our social and financial interactions now this will

take not months it will take years if not decades but it will bring us to a place where you and I truly own our assets our actions and our life in the digital space now where does Bitcoin fit in Bitcoin is the most widely adopted and widely accepted uh blockchain infrastructure and is the one that is the most decentralized and it is the the one that is the most aligned and the first to be aligned with these principles of you know your keys your ownership trust uh you know in math We Trust uh we don't trust in these big institutions so it must play a role but but the problem is that Bitcoin right now cannot service

all the needs of of you know of the world that needs it so that must change and it I'm optimistic I believe it will change and I hope it will change soon and by allowing opcat and maybe down the line other uh you know more buttons to the uh Bitcoin uh machine you'll be able to um offer this service to my dad to everyone to present like a uh a a counterargument to to that amazing Vision which that was inspiring so thank you for that I think I I I remember last year I think in in in our conversation you you mentioned proof of integrity and proof of perhaps even altruism I think um and so these kind of

Concepts that have fueled starkware have been have been really really awesome to kind of watch play out from the perspective of censorship resistance which is kind of the underpinning of all of this being able to happen right of of these kind of core principles of crypto to exist we we we have to build these systems such that nation states or any any actors cannot kind of uh change the rules but what we're currently seeing right now more than ever I think in both Bitcoin and ethereum is communities are trying to change the base layer rules like we're trying to implement opcat opcat into Bitcoin and vitalic and ECC amongst other community members are are looking to change the block times on

ethereum L1 or the slot times uh to decrease them to make base rollups more uh uh possible to kind of rid rid of get rid of centralized sequencing at the L2 level and kind of build more censorship resistant rollups and so like how do we as a community balance uh technological improvements at the especially at the base layer of these very important blockchains to make the systems run better with kind of censorship resistance and immutability in the long term Andy this is such a terrific question and um it's really the question of uh proper governance of this public good that is uh you know the Integrity web that we're building with all its blockchains

and I'm sad to say that I don't think we've figured out a way just yet um if I look at the two leading models of governance you know Bitcoin and ethereum there's much to be wanted and you know there was a time that people spoke about Dows and how great they are and then you know I think uh it was I think probably maybe the maker da which was like hailed as the very best but then you know like well contestable contested stuff happened there and now people are so we're still uh taking our baby steps here and it's probably the most um important question long-term question in all of uh blockchain which is how do we

achieve true broadness meaning broadness of the base of operators of the base of parties that are that care about about blockchain and how do we govern it um all I can say is that um starked ecosystem meaning you know the starnet foundation and the folks there the um folks within the ecosystem Folks at Stark we're we're spending quite a lot of time and trying to figure out what is the right balance of power and checks and balances that maybe someday will be in place uh to better govern it but but in the long term I mean look this sort of tradeoff between not moving too fast

and but allowing for change and then allowing for the right kind of change that is in the benefit of the public as opposed to being in the benefit of you know some some Corporation or some nation state it's a problem that um I don't think blockchain is solved and um I hope we do it's really important but I at least think that the incentive models to do so especially from the community of people who have a significant amount of their financial livelihood or their careers invested in their entire time and their their communities their their social networks that incentive mechanism looks quite a bit different than like a corporations incentive mechanism or kind of uh different type of organizations

which are kind of there for different reasons so I think like that that idea is there but similarly I agree I that's why I kind of asked because I I do feel like Bitcoin coin has been this aifi asset which has led to almost in my opinion some of its its value it's its lack of ability to change but now it's like if we can slightly you know move it away from pet rock status and into more uh useful than the than theoretical value of the entire Bitcoin ecosystem and network the actual network uh you know let alone the asset uh will significantly increase in terms of Mind share in terms of developers community users so so yeah I mean it's you're kind of you're trying to kind of trying to

balance here uh what what we do as a community and I think that as you said kind of doing things slowly and making implementations and and having a transparent uh kind of community infrastructure available and kind of to have open discourse is is very important yeah I I completely agree that um we need to improve um right you do have Broad of the base of operators and stakeholders within a lot of these uh blockchains but the question is you know there are questions of transparency of efficiency of reaching decisions of you know direct governance as opposed to delegated governance and you know the

mechanisms and transparency around them we are putting a lot of uh I mean I can I can mention there are like at least um three separate voices that probably need to be heard in some in some fashion one is the token holders the other other is the U let's called it the uh Builders um the third one is the users and they're not necessarily the same ones and then the fourth most interesting but very hard to you know capture is let's call it the um Humanity at large you know all those for instance who are currently not token holders um stakeholders Builders or um users um and giving each one of them the right Voice via delegates and the right

check and balances I think is this like really big question of governance that we haven't figured out but we are thinking about [Music] it cartei is your home for app specific rups at the Forefront of developing new tools and platforms that enhance the capabilities of blockchain Technology cartey enables applications that are flexible and built to scale build on a Linux environment in the traditional software libraries but in blockchain development go to cy. that's cy. to learn more about building your own app

market one of the things that I heard from Bitcoin Nashville again I wasn't there but one of the the points that resonated the most was this idea of like a a national stockpile similar to how El Salvador is doing now these us candidates are are proposing or almost voicing like their intentions to create a national stockpile and and again this is something that I I'm excited about in the moment but then worried about in the long run for the for the same reason of broadness does this in your opinion and you know I'm curious with both of you guys do you guys think this creates a centralizing force where we end up and ethereum is going through a same a very

similar thing where a lot of ethereum is concentrating via the ETF Bitcoin went through it too in Black Rock and these large Financial players do you think this is a long-term good or a long-term bad when it comes to achieving some of this broadness and decentralization efforts I think that um this is an uh a big fundamental problem in human history which is power gets acred and gets concentrated over time and the biggest challenge of of human society is how do you deal with that um and it's true within democracies it's true certainly within countries that don't have democracies and it's also true in a

decentralized ER setting um you know you need to have mechanisms for constantly driving uh Power to those who are unempowered and to those who are contributing but it's not reflected enough so one way you know one small step that we already did on starkit was the devics program that basically talks about automatic allocation of a portion of uh fees and someday it will also be you know new minting to teams that are building things that are of value to users and to uh the network and if you do it in an automatic way you can at

least have something that is not open to human corruption where newcomers can get uh you know power and have a say at the table I would love to say that I have a solution for it I don't and it troubles me a lot and um but you know I'm not giving up like I hope there is a way to constantly broaden the base via some protocols or ways to you know constantly make sure that it doesn't get over concentrated in with one set of players but I don't have a good solution for it today yeah I find the ETFs in particular particular to to be a little bit uh like paradoxical in the sense where they're extremely powerful for getting uh new

new people of the you know older Generations exposure to crypto assets and kind of getting used to the idea of crypto assets but also uh the more crypto Assets in custodians hands the the the more problematic for given networks and yeah I mean to just kind of echo Echo what ell is saying I think that there's there's going to be a lot of experiments and that is what the beautiful thing of crypto is and so all I can say is I would just encourage more and more experimentation at each one of these fronts and um yeah I think I I think we can come to a come to a wrap here and just say that I'm really looking forward to what uh Stark's going to do on bitcoin and this next

generation of Bitcoin um like Rob uh you know we we kind of got into the the Bitcoin space like 2016 2017 and where there was no chains to interact on back then so we've came a long way and it feels like it feels like the next five years are going to be uh extremely extremely fun to be a part of it and also we'll we'll look back at the at those early time periods like um maybe with a smile on our face as as to like how do we get here so looking forward to that and also to what Stark net plays a part in that as well as scaling Bitcoin and uh yeah thanks thanks for coming on man it's been a pleasure thank you Andy thank you Robbie um yeah it's been a pleasure