Optimism OP Stack, zkSync proof merging and more - The Daily Gwei Refuel #470 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of The Daily gray refuel where we kept the latest news in ethereum ecosystem I'm your host Anthony 18th of October 2022. all right everyone let's get into it so I know you're all probably sick of me talking about the uh censorship stuff on ethereum uh but you know it's topical right so I think I'm going to keep talking about it as long as there's I guess something interesting to talk about well I've got a couple of things here so firstly is this thread from uh TM basil Genevieve uh going uh Jenny genev Eugene going through um at the eats censorship as kind of I guess a broad case here like taking a macro view of things here and they start off the thread by saying each censorship is 95 far five to five percent to-do list uh

and they continue people ask me my opinion on the 51 censored blocks Mev watch graph that's been making the round so here goes no original opinion see how this topic is well covered and well understood I'll link those resources at the end and to be honest even though there's no quote-unquote original opinions and probably not something that you haven't heard me talk about before other people talk about before it's still a really great thread packing together a bunch of a really great points here now what really spoke to me from from this thread really at the heart of it is something that other people have been saying lately as well and that's the Practical censorship that's happening so right now uh obviously 50 or around 51 of blocks of that are being produced of all blocks that are being produced uh what's called

quote-unquote o-fac compliant right and this is coming from the Mev boost relays that are censoring obviously flashbots being the main offender here but it like even though that's the case as I've explained before you're still not practically censored from ethereum right still not practically censored from interacting with the tornado cash addresses or smart contracts or whatever address it is the one that the ones that are on the sanctions list right and this is because as I've explained before the way that the block production works is that 50 of the blocks aren't going to be produced by those uh by those validators that are censoring right so they'll be produced by uncensoring validators which means that in the most cases within three blocks you know most of the transactions

should be processed because of the law of probability there and I explained this yesterday but I think it's worth refreshing it there so for all in practical purposes everyone is still able to get their tornado cash transactions in even if the total amount of censoring going on was uh the total amount of blocks that are being censored I should say was like 95 plus you would have to wait longer obviously than three blocks you'd you'd probably have to wait a few minutes at that point blocks you every 12 seconds um what we call them slots improve of stake it's the same thing uh no it's not technically the same thing but just for the sake of um argument here uh but you'd still be able to get it in right so I think that's a really important point that I've talked about a lot but

this thread goes through as well um and on that note as well it's also worth I guess realizing that there's different levels of censorship right there's different forms of it that it can take things will affect different people in different way ways that's why I've always taken the zero tolerance policy to censorship right I've always said well we shouldn't tolerate any censorship and we could should do what we can uh on everything that we can to eliminate as much of the censorship vectors on ethereum and obviously we're doing that with all the other solutions that I mentioned before but I still think it's worth giving this thread a read because it's got a lot of great uh points you have a lot of great resources and it will probably frame things for you in a much more structured way than you may have heard of it before I know

on the refuel given it's unscripted I can be a bit jumpy all over the place or very jumpy all over the place with a lot of my points because I'm just trying to to get all the information out there but yeah I I think all these charts that you're seeing I mean the Mev watch dot info website is awesome like you guys have all seen it right it's it was shared in the Discord channel uh the daily Discord Channel when I shared it on the refuel I think it's an awesome resource for monitoring this sorts of stuff but what ends up happening unfortunately is that the I guess people who don't like ethereum people who are trying to spread a narrative are going to use this as ammo against it because you can post something like I don't know not don't include all blocks right you

can untick include all blocks as you can see here that ninety percent of relay blocks are enforcing ofac compliance and that makes the block visualization look like this right all the red is obviously the center blocks green is the uncensored blocks or the ones in for enforcing ofak censorship or not enforcing FX censorship if you just share this picture on Twitter right and you put like a bit of a fud text around it and people are going to think that you know ethereum is basically censored ethereum is fed chain whatever because there's no Nuance to this at all there is no explaining exactly what ofax censorship means here like exactly what's being censored it's not delineating between the relayed blocks and all blocks if you go all blocks uh you can see um I mean obviously it's

going to be 50 50 because of all blocks 50 each percent is enforcing o5 compliance is 52 right now it hovers between 50 and 52 over the past couple days from what I've seen um it's it's going to look like this so it's going to look a little bit better right but it's not going to look that much better but still like that looks absolutely horrible right um when you look at it like that but again this doesn't show any Nuance either so I think while this resource is awesome just like any resource just like any metrics or statistics it's going to be taken out of context it's going to always be shared to push a certain narrative and we've been dealing with this since I guess these things existed right this is nothing new um and on that note as well I think when

you see these sorts of things not just about censorship but about anything really when you see someone trying to push a narrative using one data point or one chart that makes things look bad always question it don't just take it at face value because usually the person sharing it as I said is trying to push their own agenda their own narrative and you need to look at things with a nuanced lens um but yeah anyway you can go check out this thread from from TM here I'll link it in the YouTube description below but speaking of those solutions to uh censorship that I've been speaking about over the past I guess a few weeks Terence from prilabs here said uh or put out a tweet today saying together with the legend Mario is here from the Geth team we have started prototyping features to enable the proposer to

select between a local block and a builder block with the highest fee the first step for censorship resistance and there is a linked uh GitHub repo here and now in the replies as well vitalik has basically expanded on this saying you know next step proposer locally scans the mempool and checks if there are any transactions that pay a sufficient priority fee but have not been included in uh more than three non-fall blocks if so the pros always favors local block if the real dub block does not include all those transactions translation as I said before most of the as it currently stands most of the um tornado cache transactions will be included within three blocks right because of the law of probabilities and because only 50 each percent is censoring uh you have a 50 50 ever

basically a coin flip chance every block of getting a transaction included now uh as vitalik says here if it's being greater than three blocks and a transaction that is paid a sufficient priority fee as in a priority fee that should should have guaranteed an inclusion in one to two blocks but it hasn't been included in more than not uh more than um three non-fall blocks or you can have relative certainty that that's because it's potentially being censored right so in that case uh you would favor that so the proposal would favor that local block if the Builder block does not include all those transactions as a way to mitigate censorship and then retire continues by saying it would be cool to spec this out and at least try it to see how reliable this kind of mental scanning is and how often such inclusion failures happen

quote unquote accidentally right because you can never have guarantees around why something wasn't included like just because a transaction wasn't included in three or more blocks even though it paid a sufficient priority fee doesn't necessarily mean it was being censored right um but we as I said we can have relative certainty and also I mean it's just a good thing regardless being able to make sure that all the transactions are being included as they should given that they pay their sufficient priority fee right like you guys know with the rp1559 there's two types of um of of fees that were in conjunction there's the base fee which is the same for everyone uh and then there well I mean it's just it's a float it's obviously floating but like the base fees the fee that everyone has to pay and then you pay a priority fee

on top of that uh normally it's defaulted to like one but if you want to give your transactions in faster you want to guarantee inclusion in the next block then you would pay a higher priority fee and that's what vitalik is basically saying here with regards to censorship so as I said there's plenty of solutions being worked on some of them require hard Forks some of them don't some of them are coming soon some of them are coming later I honestly think that that shot authorized Beacon channel the private mempool stuff is one of the best solutions that we have that shouldn't take as long as something like PBS to come out and just the refresher for those who don't know the shutterized beacon chain is this concept of all the transactions are submitted into the mempool whether it be through a relay men pool or the public mental and

they're private so you don't know what's in the contents of these transactions you don't know what's in the contents of uh these bundles that are sent to the relays which means that the validators have plausible deniability over what to include in blocks so just say I've submitted all these tornado cash transactions but the thing is only I know that only I know what those transactions are the validators on the network don't know so they're just going to default include everything based on obviously the fees paid that's how it should be so I don't know how complex that is to implement I believe it's maybe maybe not less complex but like I believe it's more realistic to get something like that into the protocol uh um before PBS but again I'm not entirely sure here but that solution just seems really really cool to me because as I've

discussed before there are the two types of censorship inclusion censorship and attestation level censorship the shutterized baking chain won't do anything against attestation level censorship because of the fact that the matter is like once the transaction is actually on chain it's no longer private it's only private while it sits in the mempool or like the pending transactions pool right um so while it sits there it's completely private which means validators don't know what they're including and and can't pick and choose right uh but once it gets into blocks well then it's in a block the validators can see what blocks are attesting to they can see what transactions uh were included in that block but as I've explained before at a station level censorship is next level like it is so totally I guess different to inclusion censorship and it's actually much worse and there are in protocol mitigations

for that on top of the social slashing as a last line of last line of defense that we have there unless the last resort the nuclear strikes so to speak so there's there's all of that stuff on top of this but very cool to say that core devs are taking this seriously they're working on these Solutions is there I think what they're doing is they're trying to find as many short-term Solutions as possible because they know that there's other Solutions like PBS and CR lists are going to take longer to deploy out so they're working on what they can right now in order to mitigate this which is very very cool and I I've seen a few people throw out conspiracy theories um and I think I mentioned yesterday about flashbots censoring on purpose in order to push people to take censorship resistance more seriously I mean that's a nice

narrative to tell ourselves if we want to believe that if you want to believe that reality go for it right but like I personally don't believe that to be the case um but I do believe that flashbots themselves as well are doing everything they can to make it so that uh these relays can't censor right these relays uh consists all there's no incentive to or can have that deniability and have that protection I guess like that legal protection because that's what it's all about at the end of the day these people running the relays are choosing between running a foul of ofac and providing a service and at the end of the day like no one wants to run a foul of ofac as I said before the penalties are quite large for that but yeah anyway I'm going to and that there on the censorship

discussion there's a bunch of other things to get through which starting with a interesting tweet from toggle who works as a senior researcher at scroll so a toggle was quote tweeting uh Richard who said no amount of quote unquote fractal scaling is going to remove the need for a fast L1 assuming Mass adoption it's inevitable that someday millions of users will simultaneously migrate state from uh to L1 absolutely crippling a slow base layer so obviously Richard doesn't really understand uh machia unfortunately uh and then toggle quote tweeted him and said base layer should be decentralized and affordable to run on as modest Hardware as possible you can make the layers deployed on top of it quote unquote fast by adding economic finality guarantees however you can't Mark and make a fast base a decentral a

base layer decentralized if it requires a super cute a supercomputer to run a full node and as I've talked about before right as I've mentioned before the reason why ethereum layer 1 is being I guess kept the way it is is to allow people to run full note roads on consumer grade Hardware I mean that's really the heart of it and we know now especially over the last year or so that scaling via that modular approach of separating those concerns out scaling about layer 2's layer 3's fractal scaling that all is a reality that's no longer a pipe dream that's actually being worked on uh some of it's live in some forms right I mean we have the layer 2's live on mainnet um so we don't need to make these I guess uh compromises here and unfortunately Richard didn't really want

to have a I guess like an intellectual uh debate right right with toggle here he replied saying other super computers in the room with us right now which is obviously a smart-ass reply um but yeah I mean there is a definitely a big philosophical divide between certain parts of the community you've got the you know the layer one uh Shields maybe shows in the right word layer one maximalist who think that you can do everything in layer one and it's all well and good and then you've got the people on the other side of the modular camps obviously the monolithic modular uh dichotomy the dichotomy there um that think that obviously we want to keep layer 1 decentralized so we can't do everything on layer one and we'll just scale at the different layers there and this is topical to today because the Aptos uh the I guess Solana killer

launched on mainnet today I mean I'm not going to spend any time on Aptos because it's already been done to death on Twitter today but it speaks to what I was saying about there's always going to be another blockchain that comes out and says hey we're faster cheaper you know more scalable better than this other chain that claimed to be that before first I mean in terms of like the ones that got the most attention really first it was eos then it was I mean there was a bunch of others around there at that time as well but then it was Solana and now it's like Aptos and these other ones like sui and say right and you basically are progressively making your way back towards being a centralized database that's it you're basically it's kind of

funny you have that spectrum and each time one of these things come out comes out it just looks more and more like AWS right and it just it doesn't really add any value here doesn't add anything to the ecosystem all it does is attempt to extract even more money from gullible people in this ecosystem um by spinning up one of these new layer ones but uh but yeah anyway I just wanted to recap that because I hadn't spoken about that in a little while all right so an update on what's been going on with the eth issuance numbers so 6500 eighth or 8.5 million dollars has been issued since merge including the burn uh whereas underproof of works if it was still on proof of work since the merge it would have been 400 000 eth which is 528 million dollars uh

including the burn as well that is a 98.4 reduction in each range in just over four weeks I've said it before and I'll say it again I know inevitably whenever I say these people are like oh but what about the price the price hasn't gone up at all the prices just sideways guys if there's one thing that price does it's lag fundamentals right like the market is not enough not efficient enough to price things in like I've never believed the the meme of things being priced in because I've explained this plenty of times on the refuel but the the the I guess like the main reason I don't believe that is because you can take Just One Look at crypto Twitter and see how many people have just come constantly confused about this ecosystem and that is the general population right that is the general

kind of narrative that falls out there so how can any of this ever be priced in I mean even people seeing my tweet here they probably don't even understand what the impact of this is because they're probably still thinking short term they're like oh this hasn't done anything for the East price this doesn't mean anything but it will like we've removed half a billion dollars of potential cell pressure right and a lot of the times what ends up happening is that miners will start like that mine is obviously sold to cover costs but during bearish periods they'll be more inclined to stockpile what they can if they believe that there'd be another bull market so they could sell into that right and obviously as the price went higher they were mining the same amount of eth and then that Ethan nominated in USD actually went higher and higher so

they ended up uh needing to to sell they ended up signing into that liquidity and just put so much cell pressure on the market we're not going to have that the next time demand comes back we've already removed potentially half a billion dollars of cell pressure so what ends up happening is that when demand comes back logically and I mean I think this makes total sense it's not investment advice I think makes sense the price should trade much lighter on the way up it should go up uh much much easier because you don't have that you know massive amount of cell pressure there but in the short to medium term I've I said this for so long on the replay I said this for so long before the merge short to medium term I never expected it to like pump or automatically especially if we were

already in a bear Market especially given the bear Market that we're in right now right so just for like the the thing I tell people is like patience like if you're a long-term investor short-term price shouldn't matter to you at all uh and you will understand that these fundamentals here of this issue introduction are actually going to play out they're just not going to play out during bear markets because the demand is basically still zero but uh you know it's it's not gonna I mean if you believe it's not gonna be like that forever well then you believe that the reduction in over half a billion dollars worth of cell potential cell pressure is going to play a big part in that as well all right I'll do some Layer Two updates so today ZK sync announced that they have successfully completed miles throwing three of their roadmap which is

proof merging with integration of validity proofs ZK sync 2.0 is officially the world's first ever ZK VM running on a public test net everyone says they're the world's first ZK VM running on a test net I'm not even going to debate this anymore people can say what they want um I still think it's cool to see another ZK VM running on a public testing that right with uh with um with validity proofs running as well I believe zkasync 2.0 is very close to launching uh what is it it's not even it was 17 days on October 12th October 18th it's only 11 days away guys uh until uh ZK sync 2.0 Launches on mainnet which is very exciting it means we get yet another one of these uh layer twos on mainnet and a ZK VM on mainnet right obviously there's a bunch of other teams

working on dkvms but I'm excited to see ZK syncs implementation of it there's a lot of hype behind ZK sync right now and I often wonder is that hype because ZK Sync has has already announced that they're going to do a token and everyone's trying to find the token or are people genuinely interested in zk6 ecosystem I think it's a bit of both it always really is I mean the same is true for any of these layer twos um Sami is obviously true for for arbitrum and optimism like I mean aperture doesn't have a token yet optimism does but it still plays into it right we all know tokens Can Be incredibly powerful even in Bear markets um but uh but yeah I'm looking forward to this going live very very soon and congrats to ZK sync for getting uh getting to Milestone 3 on their roadmap

all right so an announcement out of optimism today so uh the op stack has been announced which is a technical complement to the optimistic Vision so the tldr on the op stack is that it is a set of modular components that can be assembled to build custom chains to fit any use case and they refer to them as op chains so basically it's taking optimism software and creating a whole stack out of it obviously using Bedrock which is their major upgrade upgrade going live relatively soon and letting people build whatever they want so essentially let's take an example here if you want to build your own optimism chain right if you want to build your own layer 2 well you can use this op stack to do that so for example instead

of do idx being like oh well we want to go to Cosmos and build our own Sovereign chain using the cosmos SDK they could be like hey we want to build our own layer 2 using the op stack and I've talked about this before with like stacker Network and and polygons SDK so it's really cool to see optimism joining The Fray here arbitrim has their own thing as well and it feels like a no-brainer if you want more people to use your Tech develop on your Tech and grow your ecosystem you need to give the tools to these people to be able to do that you need to give the tools to developers to be able to do that so there's already been some things built on um with the op Stacks you can see here that announced that Devcon 6 uh lattice turned Bedrock

into a crafting based voxel game where every single action is an on-chain transaction so basically a Minecraft clone uh using Bedrock using optimism's Bedrock technology which is very very cool and then a team of hackers also made a fork of Bedrock where the execution engine is swapped out with a Gameboy emulator effectively building a Game Boy roll up I've said it before but gaming on roll ups and layer twos is going to be absolutely massive it's going to unlock so much really really cool stuff on there um and we've really only scratched the server so I'm not talking about like all these web 3 nft Shield games that you've seen everywhere I'm not talking about that I'm talking about literally a paradigm shift in how games are created the infrastructure that backs these games up how people interact with it Beyond just having you know nfts like

beyond that like literally the back end of it not just the front end of the user see but also the back-end infrastructure behind it and there's a lot of this stuff going on on stock net as I've highlighted before but it's cool to see this stuff happening on optimism as well and I believe arbitrim and polygon I mean the gaming stuff is such a huge Tam like the total adjustable market for gaming is billions of people I mean how many like gaming has not just has become more than just like you know your consoles and your PC it's become your phone most people do gaming on their phone so could you imagine an app that you can download on your phone that uses uh layer 2 as its infrastructure as its back-end infrastructure integrated with nfts and everything like that and people can play these games on on their phones

and get you know get value out of them I know a lot of the mobile games are basically casinos like they're just the gacha things where essentially you have to buy items to progress in the game and stuff like that but I mean who are weird it's hard to say what people should and shouldn't do with their money and what fun they should and shouldn't have but for me I'm more interested in the a unique a uniquely enabled uh I guess like game worlds that can be created here Dark Forest is a good example of this they were on a side chain they're one of the first uh crypto games to actually do something novel with uh their kind of like Planet conquering stuff with CK technology uh but they're actually I believe going to be building on a roll-up uh I don't know if that

that's uh been they've detailed that much but I believe I've read something about this a while ago that they were building something on Layer Two so that's really cool as well but yeah we haven't really seen anything yet there's going to be a Cambrian explosion this sort of stuff will there be enough demand to justify you know how many of these things come out who knows we won't know until we basically test out test the water so I'm super excited for this I'll uh link the op stack thread in the YouTube description below there's also a blog post as well you can go check out all right so something really cool that I came across today was posted by satoshi.testaccount.eth which is a website called bdl.eath.limo which is a Windows 98 online emulator via an ens domain so you can

see I've got the website up here actually you can see the classic Windows 98 uh interface here GUI here and you click on my computer it'll kind of uh I haven't actually done this yet so I'm wondering what it opens up or what it what it attempts to do it's probably just gonna completely lag out and not really do anything uh yeah it's not really I don't think it's doing anything right now oh no it did it just uh minimized it so okay it's got like a full-blown emulation going on here so you can see uh the C drive has popped up and you can go into different folders uh it's it's a little bit slow uh or very slow actually I can't I don't think I can click into the folders um no it's not letting me click into the folders but anyway that's there uh

there's a few other apps 3D pipes I'm sure everyone remembers this oh god what have I done okay that's gone okay so it's like not totally working but I thought it was still cool to see this running on like a an eighth domain using the eve.limo resolver here which I've talked about before uh let's see if Solitaire Works actually uh Solitaire so for some reason everything's starting minimized but damn this is slow uh guess the server that it's running on is powered by a potato oh yeah there we go Solitaire I have completely forgotten how to play Solitaire I'm not even gonna not even gonna attempt that and you've got mine sweeper but yeah I mean I just thought there's something cool that I wanted to highlight for you guys I'm not going to spend too much time on this one but you can check it out yourself I'll

link it in the YouTube description below all right last up here uh bankless put out a good resource today that I recommend checking out that uh basically uh is David recapping bar and Cliff's Devcon six experience so it's titled what you missed at Devcon it's got the best talks you know experiences uh David's best uh I guess like um things that he's saw at Devcon all uh for you in this newsletter so I mean I highly recommend going and checking this out if you're looking for a creative resource of talks you should watch there's a lot here actually so maybe on your walk or jogs or or whatever you're doing at the gym you should give those a listen and check all that out because there was a lot of really great talks I'm definitely going to be doing this because

unfortunately I didn't make it to Devcon uh but yeah just wanted to hire this for you guys here now I have a few minutes left here so I wanted to talk about something um the the censorship stuff I've spoken about a lot so I'm not going to rehash it there but don't let the censorship stuff like I'm gonna talk about it in the context of something else now I I don't let the censorship stuff cloud or I guess like undersell what ethereum is doing right now so take away the censorship stuff for a minute and think about everything else that's happening in ethereum right now we have obviously the successful merge that has you know kicked on just fine nothing's gone wrong with it since we merged it's been over four weeks now everything's well and good we have all

these layer twos just absolutely killing it they're releasing all their new updates they're coming out with I've Got Magic avms coming online soon we've got stuff going all the time uh people are really energized about various different things still uh it doesn't really feel like a bear Market on the fundamental side of things so I think that the censorship stuff because it's been such a big conversation lately and it's all over Twitter and everyone's fighting it and everyone's selling their own narrative it definitely does overshadow all the really cool stuff that's happening so I would suggest uh if you see people fighting it and just like you know just saying absolute crap on Twitter about the censorship stuff and not actually adding anything to the conversation or any nuanced stuff I mean I the way I do it is I just mute these people to be honest because if they're

saying that then they're really not worth listening to and if you're getting exposed to a lot of it you don't want to mute people just keep in mind that you're just getting up an influx of just bad information like you have to keep that in mind because what ends up happening is that if you're not conscious of it that bad information starts clouding your judgment around things and you start feeling like things are worse than they are and this is true for a lot of things for example everyone says that you know the world is in a really place right now everything's going to you know it's Duma everywhere but I mean yeah okay like it's it's the world is depending where you are in the world it's worse than within other places obviously I mean there's an obvious example here if you're in Ukraine it's

worse than being a lot of other places right now but I think the media and harps on about all this negative stuff because it gets more clicks right so then it influences your brain to think that things are worse than they are when in reality I think relative the world is pretty much in the same place that it's been in you know for the last few decades at least um and then I think it's actually gotten better to be honest but like that's all incredibly complex it can't just be boiled down into a headline so yeah you need to be conscious of these things at least in my opinion in order to save yourself from feeling Duma feeling like the world's ending feeling like everything's going to because it also it also affects your investing uh habits as well because I know people may think oh my God

everything's going to end I'm just going to go to cash I'm just going to sit on it and I'm going to be safe there but the problem with that strategy is and again this is an investment advice so the problem with that strategy is that like you could be completely wrong and then because you're you've gone into this I guess position based on what everyone's telling you based on the media um it just ends up putting you in an even worse position so you always need to take a balanced approach to these things you need to be conscious of them and just be conscious of your own biases with your the information that you're exposed to uh and go from there it's even it even applies to the refuel guys like obviously I'm always going to give you the bullish ethereum take I will give you like bearish takes from time to

time or at least I'll criticize things that I think deserve to be criticized but obviously I'm incredibly biased towards ethereum I can't remove that like it's just not going to happen I can't be unbiased and I admit that all the time but you shouldn't take my word on anything like if I say something uh you shouldn't take it as gospel you should definitely corroborate that should definitely talk to people about it talk people in the daily Discord Channel about it which you can join uh as well if you haven't yet um but I guess as the main point is that that applies to everything just don't get your information from One Source don't think that what the media is telling you is the truth uh get out and touch some grass as they say because I think that's the best way to to get ahead of that

stuff but anyway enough lecturing for today that's going to be it so thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe to the newsletter join the Discord Channel and I'll catch you all tomorrow thanks everyone