New stablecoin regulation, OpenSea on Arbitrum - The Daily Gwei Refuel #452 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of The Daily gray refuel where we kept the latest news in the ethereum ecosystem I'm your host Taylor 21st of September 2022. all right everyone let's get into it so some new stablecoin regulation out of the US today so this DB account on Twitter said issuing a stable coin without approval from appropriate Regulators could be punishable by up to five years in prism and a one million dollar fine under Draft House bill so this is a bill in the U.S uh house not the um not the Senate here and you can read the full details at this uh block link now uh as far as my reading goes this I think only applies to algo stable coins or stable coins that are backed by

self-referential collateral so for example this would apply to UST uh which obviously doesn't exist anymore while it kind of exists but it's not really a stable coin anymore um but because Luna was backing it up uh or Not by backing it up so to speak um and it wouldn't apply to things like die or usdc or usdt right because they have real collateral backing it up I don't think this is going to be like the way it is when if it gets accepted into law or if it gets accepted in into regulation because this is just in the house right now so has to pass the house then go to the Senate it's probably going to die in the Senate um I don't know if we'll see this go go much further than that but the punishments are quite severe I mean like you can

even just see punishment by up to five years in prison and a one million dollar fine like that's crazy for a I guess like white collar crime like those sorts of punishments don't really get ditched out very often and I guess we can all see why this is uh what why this has come to be it's pretty much because of Terror like this is just more Fallout from the terror debacle where Regulators are looking at what happened with Tara what happened with UST and looking at all the people that got wrecked and are like wow we can't let this go on they were just looking for an excuse to rate to over regulate the industry and they got one we gave them one on a silver platter guys like just ridiculous right now even though this only applies to algo stables at least from my

understanding I still think it's a stupid regulation and a stupid bill at the end of the day like you shouldn't regulate away experimentation and regulate away Innovation um but I think that obviously when you look at Terror it was a really bad idea and a lot of people called it out as a bad idea now if we want to encourage Innovation and experimentation without things like Terror happening over and over again the way you do it is you put guard rails in place as the creator of those projects right like you do like a guarded launch as we've seen a lot of projects do or we do kind of Regulation within the industry ourselves but that's a lot harder I think because as we saw a lot of people called out Terror like for months and months and months and were

attacked relentlessly attacked for it by the the lunatics right uh and it got to a point where I think a lot of people capitulated and just said wow okay you know Tara is actually going to work well UST is actually going to work this is a new paradigm and then it obviously all came crashing down so there is a fine line here and a fine balance but I think the problem is is that self regulation is really really hard especially in the crypto industry because people just don't care especially when they're making money especially during bull markets and on top of that it's very hard to know what is a actual credible experiment slash Innovation and what's that and something that's actually being built uh for the longer term and with good intentions versus something that is only being built as something to extract

money out of the ecosystem like that proving that is basically impossible because you need to go through the courts to prove that and even then it'd be very very hard to do so I think that governments are doing what they do best which is regulate and and draft new bills and draft laws like this is to be expected and I said I believe Pro even before Tara collapsed I've been saying for a while that stable coins are going to be the thing that they regulate it's the easiest thing for them to regulate and it's coming it's taken a bit longer than I thought but it's not surprising to me at all and there's also a section that state pulled out here that said the current draft bill on the negotiation between house Financial Services committee chairman vaccine Waters and the community's top Republican uh Patrick McHenry would create a two-year

ban on stable coins that aren't fully backed by cash or highly liquid assets like U.S treasury bonds the bill would also create a two-year grace period for operators with coins that aren't currently collateralized by those assets to change their business model and receive approval the Federal Reserve would also be directed to study the economic impact of U.S digital dollar a process that Central the central bank has already begun with things like cbdc's right so this is the most interesting thing I think here is that like on the surface this doesn't actually look like a quote-unquote bad regulation or bad Bill right because it goes after the things that we know to be just bad in crypto and we know to have heard a lot of people in crypto but as I just explained there are other ways to regulate and to prevent these things

from happening but it is a delicate balance now I do like that they seem to have a good grasp here that stable coins that can be backed by you know cash or higher liquid assets such as other stable coins like our dies backed by usdc and higher liquid assets like eth or they can be backed by sulfur referential collateral like what happened with USD it was backed by lunar which had that infinite mint function and it would obviously it was it was based on some kind of like algorithmic Behavior so it wasn't great and I do like that it is also proposed that a grace period here for up for operators to basically stop building these things and and build something that's that's collateralized but as I said and as I said plenty of times in the past I just I'm not a

general fan of financial regulations but again I'm not surprised at all by this like I saw this this morning and I was like yep okay well that's just more stable cone regulation and then I looked at the details and I'm like okay yep thanks dokwon this this is all you bro like this is this is literally all him and all the terror debacle like because they're making the delineation here between highly uh sorry between stable Queens backed by cash and highly liquid assets and stable coins backed by basically nothing right and they wouldn't be making that delineation if Tara hadn't blown up like it did and I don't think they would be being this harsh about it either I mean up to five years in prison in a one million dollar fine is very very harsh right so you can kind of look look at this as well and

think well there are other things out there that may look like a terror or an algo stable but are actually not like that but yeah okay they're not totally backed by cash highly liquid assets but there's other reasons why they keep their Peg or other reasons why they behave that way so again this does kill Innovation off and it kills experimentation off if it was actually to go into to law to become become a regulation here um but at the same time like we shouldn't be surprised now that's not me kind of I guess giving excuses or giving a cop out here for regulation I don't think that this is the solution uh but I guess like it's going to come whether I think that or not like and there's nothing I can personally do because I'm not a US citizen I can't vote for or

against the representatives here uh I can't do anything right like all I can do is spread the word I know that I have a lot of Americans obviously that watch this show and listen to the show uh but uh but yeah we're gonna have to see how this progresses as I said like the thing is a lot of things usually get passed in the house and then just die in the Senate so we'll have to see but uh I don't imagine this being a I don't know too controversial like it's kind of weird when I look at the two I guess uh parties in the US like Democrats and Republicans and the part the people within those parties they have a very dumb I guess varied uh views on things and I'm not going to get political here but yeah you definitely want to look at it yourself and look at

where each party sits on these sorts of issues um but obviously uh right now it's not looking great especially from like the sec's point of view with whatever Gary genslow's up to and whatever he's saying uh and other kind of like regulations and restrictions that just keep coming every other day but at the same time they just draft bills they're not in law uh just yet and at the end of the day like anything can be drafted anything can be put forward and anyone can say whatever they want but it just depends on the end results so yeah anyway I'll link this in YouTube description you can go check out the full uh breakdown from the Block here all right so uh Danny Ryan announced on Twitter that uh eip2982 australity phase zero was finally moved to final took just over

two years a fun fact the merge happened exactly two years after this eip's publishing date so I remember when this first got published as like a draft or whatever and me moved into final status means that it's done uh this is just like amazing I mean it feels so much longer than two years for me uh because like I've been following this stuff so closely but just thinking back to when this was proposed if you had told me that it would take two years to get to the merge I would have said oh no I'm more optimistic I think it's going to be quicker than that but I also wouldn't I would have said um oh two years isn't that long uh okay well yeah technically two years isn't that long relative to to other things but it feels a lot longer than two years

like especially because if you think about it two years ago was uh 2020 right it was like what uh September December 2020 that was the I guess like end of D5 summer and at the time uh the beacon chain wasn't even live yet right the vegan chain went live December 1st 2020 so just cool to see this moved into the final status here and just like going through this I read through this you know plenty of different times when I I drew the development of uh the beacon chain the merge all that sorts of stuff there and for those of you who don't know these two was known as Serenity at one point as well so I was like you know working towards Serenity or getting to Serenity and there was different phases as part of the quote-unquote E2 road map like phase zero was gonna be the beacon

chain launched and phase one was gonna be sharding phase 1.5 was gonna be like uh something similar to the merge and then phase two was going to be I think like um full shouting or something I can't remember exactly what the details were but there were these phases and they got scrapped because it made more sense to do it the way we're doing it now uh but just I took a little trip down memory lane after seeing this on Twitter today I just wanted to highlight that for you guys all right so an interesting little research paper here published by donesses uh zindros I hope I said his name right here uh talking about proofs of proof of stake with sublinear complexity if that means nothing to you it's all good because it means nothing to me either but the interesting part of uh this tweet thread and the thing that

I understood the most was uh this tweet here where they said where he said the goal of this work is to build a wallet or client that can bootstrap into ethereum without downloading the whole blockchain's history but still validating everything without trusting a server contrary to metamask or inferior so this is basically like a light client and this is one of the Holy Grails of ethereum is developing these light clients where essentially you don't have to use a full node to uh to download the whole blockchain history and bootstrap your own I guess RPC so to speak right so you can basically have an RPC on a mobile phone for example and be able to relay your own transactions with uh with full security and full trust that what you'll do what you're the chain that you're looking at is the right one and

you attracting with the right thing so you don't have to trust you can verify this research you can go check out for yourself it's quite technical I don't understand it under the hood but it does look very interesting and there is a thread as well to go along with this but uh yeah like clients is another thing that you guys should be learning about and paying attention to as we progress through the ethereum roadmap it is extremely important and it goes hand in hand with things like The Verge and statelessness but those sorts of things are definitely coming and they're going to add a lot of value to ethereum all right so Summit ESAT has a thread here today all around the ethereum merge and how some solo stakers uh have enjoyed perfect or near perfect

performance pre-merge but are experiencing degraded performance post merge so he explains why this is the case and some of the reasons are I mean one of the major reasons are resources because pre-emerge you didn't have to run your own execution layer client you could Outsource that to a third party but now post merge you have to run your own execution client which takes up more resources so if you had something that didn't uh you had some Hardware that didn't have those resources then you would be uh feeling the um the pinch here maybe your validator feels a slower maybe it's not a testing to it blocks as fast as it once was not as effective as it once was and these kind of these resources are like RAM storage CPU along with SSD performance there's also issues with client performance and client bugs especially on the minority ones from

what I've seen so and user error and things like that but yeah I mean generally this stuff will get ironed out it's not critical or anything like that but it's good to highlight that in a post-merge world things did change under the hood for especially for solo stay because you manage all their own stuff uh and I think that they're gonna just I guess like it's like the the um the participation rate on the beacon chain where it's just self-healing like people are just going to pay attention to this they're going to fix whatever needs fixing and it'll all be well and good so give this thread a read I'll uh I'll link it in the YouTube description but I just thought it was uh something very uh important that was uh highlighted here all right so I came across this new website called luckystaker.com and this

go like the other actually the other day I should give some context here in the Discord Channel I was doing some really rough terrible napkin math on what percent chance you have each day of proposing a block with uh with a solo validator so you can see here that this website actually outlines that for you based on different time intervals so every day you have a 1.67 chance to propose a block currently so it's based on the amount of validators there are on the beacon chain like the more validators the less chance there is for each individual validator to propose a block the less the more chance there is right so every one day you have 1.67 uh chance 30 days is a 39.58 chance 90 days is a 77.9 chance and 180 days is a 95

chance almost 100 so you could expect on average for each of your validators as a solo sticker to propose a block uh twice a year on on average and uh proposing a block is only one uh for proposing a block you get rewards and obviously you don't just get uh the block reward you get the fees and the potential Mev as well but that's not the only way you earn rewards you earn rewards for a testing and being part of sync committees and all that sort of stuff as well so the thing the reason why I was doing this napkin math because I was trying to figure out like for my for my own validators like how what my chance would be and obviously I'm not going to say what my chance would be because it would give away how many validators I have but I wanted to work out what the

chances were of a 100 chance in a day as well like uh so for 100 chance in a day I mean you just do the naive math you have 100 divided by 1.67 you would need uh 60 validators to to do that right so uh and that's each day so you would one of your 60 validators each day on you know it almost pretty much 100 chance would propose a block on that day uh and that's or I just did the math again on that that's uh 1920 eighth is that how much you would need to propose a block by of one of your validators each day now every 30 days it gets a lot more a lot easier right you would only need two and a half validators I think not even that obviously kind of half a validator but two and a half validators

um to propose a block uh every 30 days is 100 chance uh and then obviously it gets a lot higher up from there on these intervals yeah so uh I think you know there aren't many people out there who would have 60 solo validators uh that they run to be able to get a block every day but there definitely are some out there uh you know I mean I wish I was one of those I I will give away a little bit there I definitely don't have 60 validators I wish I did because that'd be really cool but there are people out there who do and obviously you know when you count pools into this sorts of stuff it makes it it's different but this is just strictly speaking about solo validator so I thought that was just a cool little start to show here but even

if you're running one your chance of reposing a block each year is 100 like you're at least gonna propose at the very least even if you're the most unlucky validator in the world you're you're at least going to propose one a year um and I in an ideal scenario you'll propose to a year uh as long as I'm doing my kind of uh I guess extrapolation here because it only shows every 180 days which is obviously six months and I'm extrapolating that out uh to 365 days uh and you have like uh over 100 chance right so if you have I have almost 100 chance every 180 days then yeah you should propose it uh two two blocks and and if you're a lucky validator I mean the thing is as well is that because it's based on a it's random and it's based on a percentage chance

there are some extremely lucky validators out there that propose blocks every month for example right like and it it's a 40 chance so it's not actually you know extremely lucky it is on average you're very lucky but you can see actually on the big Insurance website the um the validators with the most uh rewards and some of them haven't even been around for a while but because they've been really lucky and because they've even been luckier by proposing a block that had a lot of fees in it uh at one point in time or a lot of Mev they've able been able to earn a lot of rewards so there are some validators out there that have earned more rewards in the last few months than people who have been evaluated since Genesis have have earned and that's just based on pure

chance at the end of the day as I said it's random there's no way to tell if you're gonna when you're gonna propose a block there's no way to force yourself to propose block the only way you can tell when you're going to propose a block is when your time comes basically when you've got that window uh it's not very long but you have a window of seeing that you're up next to proposal block but other than that you don't know when it's going to happen uh so it's always just cool to see the percent chances here uh but yeah it seems that you need around 60 validators to have a 100 chance of opposing a block each each day here all right so there's a new LSD that was announced well I mean it's like a pseudo LSD called the liquid Collective which is an Enterprise grade liquid staking

protocol they're building themselves as designed to meet the needs of Institutions so I did say that post merge we're probably going to see a lot more institutional staking come up but I don't expect these institutions to a lot of them to I guess like spin up their own infrastructure because what liquid staking is doing here a lot sorry what liquid Collective is doing here is that they're actually partnering with a bunch of uh different companies so they're partnered with coinbase and Kraken as integrators they've partnered with figment coinbase cloud and staked as validators and they're going to be providing uh lsds or liquid staking I should say for uh eighth uh and and Dot and avax um yeah so and then if you go down they're also going to be issuing a LSD

called Alice eth so it is technically an LSD but as I said like if they're delegating that I guess infrastructure to people who already know how to run the infrastructure but still cool to see more competition as I said plenty of times the two things we need is more competition and withdrawals being enabled to further decentralize and distribute steak out there at least those are the two okay they're not the only two things but like they're some of the biggest things and I I've talked about it a lot already so I'm not going to rehash it here uh but I mean some people have asked you know what is an Enterprise grade liquid staking protocol designed for institutions well basically it's using Enterprise and enterprise Enterprise grade infrastructure which is offered by things like coin a bit by um services

like coinbase and Kraken and marketing and selling the product to institutions now there is a popular joke that um on Twitter the Jen Spartan says it a lot about scamming the Boomers into buying our bags like I feel like that's a very crude way of saying what this basically is because institutions on sell products to less sophisticated people or people who just don't care to get involved and understand the nuances of things and a lot of the time that is the older folk because they have the wealth they want to manage their wealth they want to put it into something where they don't have to worry about it and a lot of the times it's through these institutions which then wrap the these other products up and just sell it to their to their their customers and earn a fee on it and all

that and but basically as the James button says scamming the Boomers out of their money uh and using them uh to kind of pump our bags so to speak but that's essentially what this stuff does and I don't think it's uh necessarily like a negative or a bad thing or anything I think obviously the more people we get involved more money we get involved with with staking the better because obviously the more if that's take the higher the security of ethereum and it's even better if we can just get people staking eat without them even knowing it I think that's really cool but I still go back to what I said the other day I think yesterday where I obviously believe that we shouldn't let any one entity like have too much a share of the network because that's obviously bad for decentralization so we can still

obviously have a decentralized chain with institutions on it with big corporates and Enterprises on on it but we need we obviously need to make sure that that remains that way because without the social layer enforcing this without technical upgrades to make it uh a a to encourage decentralization and all that sorts of stuff it could just end up very centralized down the line but right now I don't believe it is I think that you know even though there are centralization points right now the staking we're actually faring pretty good considering that we don't have withdrawals and the the fact is that uh liquid staking is just very very popular uh because it's so easy and it's taking with exchanges is so easy but I think we're doing quite well we can do a lot better and I'll keep pushing it a lot better but just cool to see more

competition entering the game with liquid Collective here all right so uh open c is now on arbitrim this is funny I thought openc would be going to uh uh optimism first but it seems to have landed on arbitrine first I'm sure they're going to deploy to optimism as well but this is a pretty big deal uh I believe openc is not on that many chains right now I think they're on obviously the ethereum mainnet polygon POS chain I think they're on Solana maybe uh but now they're on arbitrim and I don't think they're on anything else right now and it seems like they're going to just keep deploying to Every Chain so it's not going to be a big deal uh as time goes on but I think it is a really big deal uh right now because arbitrim obviously has a big ecosystem they have a pretty

big nft ecosystem as well uh so it's cool to see that obviously the most popular nft Marketplace is now live on the arbitrim network so if you trade nfts on arbitrary if you do anything nft related you'll obviously be very happy about this news and I certainly am as well because I think uh arbitrim right now is like the lead for layer twos uh they definitely seem to have the most organic uh Community they definitely seem to have the best ecosystem right now uh optimism is is is behind but like not that far behind I think I would say they're a close second there with in terms of ecosystem but arbitrim just is very strong right now now that's going to change over time it's not going to be set in stone I think uh obviously the the token Wars

hasn't haven't even started yet I mean only optimism really has a has a token out of uh other German optimism and and these other things like Stark net and ZK sync and stuff like that but their competition will definitely heat up but as it exists as it stands right now arbitrim seems to be a very very strong and and and and very much in the lead so cool to see open C deployed there now speaking of optimism they also had an update today talking about uh optimism quests which is basically their answer to arbitrim Odyssey it seems very similar here but optimism Quest is a guided exploration of the ecosystem that allows users to earn nfts while exploring optimism apps and there's a thread around here of how to get involved I think this is really cool honestly I think that just because

arbitrim did Odyssey which is obviously similar to to this doesn't mean that optimism can't do their own branded version of it and their own flavor of it uh because I think that we should be encouraging as many people as possible to onboard into these layer twos in whatever way possible so I'm excited about this and I think the nfts actually look really cool as well like uh the little uh um I mean they're kind of like look like game boys slash TV with uh different I guess logos and different designs depending on the different applications there so I think that's pretty cool uh but I just I love seeing adoption of layer twos that that just gets me going that's for sure like later on protocol ethereum is still my favorite thing but like layer 2 is doing Innovative and cool things like optimism

quests and arbitrim odyssey is definitely what gets me out of bed and gets me excited about this ecosystem so you can go check this out at app.optimism.io quests I'll link that in the YouTube description below for you So speaking of layer 2's infuro announced today that devs on stocknet can now connect via the inferior API so this is basically inferior supporting stock net which is cool to see obviously as I've mentioned plenty of times infrastructure is incredibly important to these layer twos and as I mentioned the other day infuri is actually planning to decentralize as well so I feel less bad about promoting infuri than I once did because I didn't feel bad about promoting it but obviously I knew it was centralized so I would promote other Solutions over and it's still centralized right now but because

inferior has is moving towards a decentralized model I'm getting more and more excited about the fact that infuro has such a large user base and it's not going to be stuck in centralization hell it's actually going to be decentralized uh we don't know when that is but hopefully it's sooner rather than later but I feel better about kind of like talking about them now and talking about them in their in their future but cool to see them supporting Stark net here the stuck in the ecosystem is still growing it's you know the funny thing is the standard gear system has a lot of apps on there but I think a lot of them feel like hackathon on-ish apps that not really fully fledged apps just yet there's more and more of them coming online but it's good to see that the different approaches here where

obviously on arbitrary and optimism a lot of the apps are copies of ethereum layer one which is fine it's exactly what we want to see because obviously ethereum layer 1 is not the way end users are going to be sitting long term uh but on Stark net it seems there's a lot of different apps on there a lot of different experimentation happening on there uh so I like those differences between the different ecosystems there all right so another bridge I guess uh protocol or project was announced today from assistant lab succinct Labs uh where they publish this blog post uh talking about improbability oh sorry it's titled towards the endgame of blockchain and proper interoperability with proof of consensus so they've been working on this for a little while here

and they say the current state of interoperability is very centralized popular multi-seek based designs Place immense Trust on a small group of people it's critical that the future of interop is as secure decentralized and unsensorable as the underlying blockchains uh bridge between and they talk about IBC which is part of Cosmos and why IBC like mechanism on Earth won't work because computation is too expensive and and also the intricacies of the evm here but and then they say you know what if we use succinct proofs to make verifying consensus efficient similar to how ZK snarks are helping ZK roll up team scale execution by implementing ZK EVMS what if we were able to use snarks to scale verification of census so you can raid This Thread and the blog post for full details yeah

there is a bit of a debate in the comments as as well about what kind of like what this is and how it actually differs and how it works and how centralized versus decentralized it is so you can go check that out check out the blog post as well I haven't fully digested it yet so I can't really explain like I'm five but it seems cool seems promising always cool to see new bridge designs and more innovation in the bridge space but I'll have to keep an eye on it and uh get back to you guys once I can explain it like I'm five like you're five all right so some ens news ens controller V2 is ready for review this adds features that pay independent developers saves up to 40 on gas costs and allows simpler one transaction registrations and the coolest bit according to Alexander sand is it's all

built by independent team so that is quite cool actually so you can read the blog post for full details here obviously I think what I'm most excited about is the 40 gas cost savings and the simpler one transaction registrations because I think those two things things have been something that people have knocked ens for for a while now that it was too complex to to do a registration it took too long and obviously the gas gas costs you know 40 savings on gas costs is obviously very huge here so I'll link this in the YouTube description below for you to check out uh and I just want to finish up here because I'm coming up on time last update is uh one out of sismo today so they're releasing a ZK bat another ZK badge for sismo which is the sismo contributor ZK badge which is Central to

their governance through private voting the community will help us create curate badges so you can mint yours now at this link here and this thread talks more about uh badge creation so just a quick recap on what sismo is here and also disclaimer that I'm investor in sismo but what they are is that they're basically issuing these things called ZK badges for reputation aggregation and privacy preserving Access Control explain like M5 version of that is imagine you have and I've explained this before on the refill but just to recap for people imagine you have a thousand Ave guns on your cold storage address that you don't want to expose to the world you can mint yourself a badge that proves that you have a that you own a thousand other tokens but you don't have

to reveal what address those are they tokens are on and the badge using ZK magic is proof of that so the protocol knows the other protocol knows that you own that 1000 are there it just doesn't know where you own it and you can use that badge obviously in governance to to to vote on the uh a governance proposal as if you had 1 000 RV in a different wallet so you can basically separate your public wallet so I could separate sassel.eth from all of my private wallets all of my cold storage wallets but still interact with D5 interact with governance interact with nfts all this sorts of stuff without revealing anything else that I've got in my cold storage and private storage which I think is obviously very cool that's why I backed this team because I think what they're building is very much needed and

falls in with the Privacy stuff that I definitely am very passionate about but you can go meet your contributor badge if you're eligible links in the YouTube description but but that's going to be it for today so thank everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe to the newsletter join the Discord Channel and I'll catch you all tomorrow thanks everyone