The Rollup TV: Ethereum Is Based

Transcript

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Hey, hey, hey. [Music] What's going on, guys? Welcome to the Rollup TV. Wednesday, September 3rd.

Today, it is Ethereum's based future day on the Rollup TV. It's going to be exciting. It's Andy. I'm here. Robbie's going to join us. We got a ton of amazing guests today. Our first segment is with Thomas, the co-executive director of the Ethereum Foundation. We recorded this last night. We're going to play it as a first segment on on this live. Then we've got nine of the best guests in the Ethereum space coming to you live today. We just dropped the base rollup market map. We will cover that as well. Guys, thanks for being here. Let's start. We're going to jump in with Thomas right now. Here we go. Welcome to the base rollup stream. Welcome to Ethereum's based. Let's go.

We start. Come on. Uh you're the first part of the uh based rollup day that we're hosting today. Yeah, it's it's uh the day before the day, so you're a whole 24 hours early. Good good to see you, man.

>> Thank you for having me. Great to see you. >> You're like the new George Washington of Ethereum. They they brought you in, start fresh. People were ready for a change in leadership. People wanted to see a new Ethereum come out. Might I remind everyone who's watching that six months ago, Ethereum was had scalability issues. The L2s weren't weren't going to work. They were parasitic. The L1 was never going to scale. And this was not going to be picked up as an institutional asset because it was only Bitcoin as a special snowflake. The community was fractured and people were leaving for Salana. Six months fast forward today, institutional adoption, DATs, base ropes are getting traction.

Still a lot of the inherent I think issues that people argue about in in the tech, but the road map is shifting and there's a lot of work to go on the L1. It's just crazy how fast some of these sentiment and things change. Thomas, how has the last sixish months for you been as the co-executive director of the Ethereum Foundation? And maybe just describe how this personal sentiment shift has has been from your perspective. >> Yeah, I think it's a it's a very very long honeymoon period so far. Uh it's been great. I think that very often I'm just the face of changes because of uh appearing on podcast and communicating much more but the changes have been had been happening before I joined uh they

have been happening in the in the shadows in the background like people in stealth modes uh build Ethereum together all around the world and I think the first first few weeks when I when I was joining and I was reaching out to people and asking asking for feedback and many of them were saying we're starting something big we cannot not allow this uh this moment of crisis feel like it's real thing and and they'll start contributing and now you see the effects of that like many uh you mentioned digital asset treasury companies you uh you mentioned some of the protocol work all of that has been started sometime before I even joined and um some of it was EF leadership helping to coordinate and then that leadership change was just

just part of it uh so I hope this also makes people just feel very very confident that Ethereum generally has um so many leaders some of them stealth mode some of them very visible some of them communicating some of them just like quietly building code and that's all that matters uh sentiment shift in in media so maybe here communication is very important like just just coming and clarifying things not allowing other people to fill in the gaps and saying that that's what's happening but explaining clearly what's happening what we were working on how we're working on it, what are our plans, strategy and even if you if you if you shift it slightly if you make changes uh over

time people start to feel it how you communicate and and where you have more or less confidence. I I think we generally have a lot of confidence now because uh we're just catching up with the communication on the things that maybe were not communicated that clearly in the past but were relatively clear. There's still some areas where we exploring the technology side of how to solve uh some challenges, how to answer to the new challenges, but the team is strong um at the foundation also the the engineers, researchers and business builders in the entire ecosystem are super strong. So, so yeah, great great few months. uh some highlights. I've

been traveling a lot and uh visiting communities everywhere and I think there is a lot of excitement. There was excitement at 10 years of Ethereum and for the next 10 years too. >> Absolutely. Yeah. And you came from a very critical role in Ethereum. You were founder of Nethermind, one of Ethereum's clients. And so I'm curious as you built up that company and was very integral to Ethereum, you also had uh surrounded yourself with very technical talent in Ethereum and you you were very deep in the the scalability roadmap and and working at some of the deepest parts.

And so now Ethereum has grown into so much beyond it its technical capacity. There's not just developers and builders, there's founders and now there's these the these DAT companies and Tom Lee and Joe like all of these things that are now surrounding Ethereum. So I'm curious, how has your perspective changed? What was the lens that you viewed Ethereum through and how has that changed up to your current role of executive director? >> Sure. when I when I go back to when Ethereum was starting and I I was not uh during the time with Ethereum like the first one two or three years uh I feel that what was extremely important is that you had people there that were connected to institutions you had people

that were committed to the research uh against already rushing uh and there were people that were deeply technical and engineering focused and all of that together created all components of the Ethereum success And probably without any of those components they wouldn't have the the success of the early days of the early years. uh when I was joining in 2017 the ecosystem uh starting dynam I've I've already seen many of the announcements of the at the time very very dynamic Ethereum enterprise alliance that was announcing one by one large institutions saying we're going to build on Ethereum and now many years forward many of those institutions that

were announcing that time are are very active or maybe sometimes they just built something tried they disappear here then coming back disappeared again uh and here is 2025 and it's really year of institutional adoption and you see the same names uh I actually learned so much and my journey with with neto mind was yeah very much more on the engineering side I've uh I worked as an engineer before that as well with financial institutions with large institutions like city bank and then with a hedge fund dro capital where practically even as your engineer that team is probably like at that time it was 50 to 100 people. So it means that you're a bit closer to all the events

and you're observing what happens. Uh but still I agree like metammind had this very very uh engineering focus of how to how to build the client performance optimization. I think in 2019 or so we were leading that push for performance matters right like you you have to really think as well that the clients can contribute to the improved performance that that engineering excellence will matter and uh that's something also like the fact that I was I was building the codebase myself at the time for a few years I was really a coder of the like core developer coder I participated in those processes that helps to understand now the challenges

uh when scaling helps to appreciate the effort of all the client teams uh also the limitations and the worries. Uh but also it means that you can be a bit more uh more brave in making some claims about what is possible and push people a bit more towards the limits. Uh you know obviously you always risk that the your cards will be overloaded feeling feeling burnt that would be crazy that would be really bad. Uh but we also understand that sometimes is that motivation that we going to the uh to the exciting times that that it all matters actually prevents the burnout when people see that everything is going well that you're participating in something great

that you're among the elite of engineers building uh building a lit project that matters then it really drives you and and I think that helps and then talking about it also is a pleasure >> and have you seen examples of that inside the Ethereum and the Ethereum foundation so far with Robin Hood coming on chain you know these companies crypto companies going public like there is adoption it is a lit protocol like these things are happening it must be very gratifying internally and also you know everyone in the community feels it have you seen those examples inside as well >> uh yeah sure I mean core developers are not disconnected from the well sometimes sometimes they are disconnected from the

news and that's great uh sometimes they they just feel the moods and and everyone in the community will will notice okay there there big announcements they there are changes in the US market there is a bit more openness from regulators there is equities trading on chain and I think that you'll see more announcements u this month uh I think is preparing something I've heard something from Coinbase today as well so so you see more trading on chain and reg is being very friendly towards that uh that is bringing that feeling that you actually have an impact. At the same time, it brings a few questions about do you do you continue working towards the

uh all the values related to retail users? Will you continue providing uh privacy and censorship resistance? Uh people start asking about about capture about maybe leaning towards uh one part of the world too much. Uh so we we pay attention, we are excited but also always cautious. We we owe that to protocol to provide security to provide all the um all the attention to what matters, what why people are building long term, why people are not leaving to to shiny new things that appear for a year or two. And we've seen many examples of the chains that just have this like super momentum for a year or two. you feel like they they kill

everything and we went from the ups and downs with Ethereum and people know that there is something deeper there why they're building why the community stays why do people in in stealth mode why they are there uh because you can always judge the size of the community of those who claim everything is going well but it's it's a bit harder to judge how many people are there that will appear in the time of crisis and term has extreme power of attracting those people that don't care about uh visible things politics and just disappear when needed and that's what makes the the chain continue going.

>> Totally. Totally. Actually, um Robbie asked this question to some institutional folks that we had on earlier today which I think is is is also interesting for you. Kind of shifting gears away from the community, away from what makes Ethereum so incredibly powerful from a technology perspective really the social layer, the social consensus. Uh, some call it maximalism, others call it belief, some call it tribalism, others call it ideology in decentralization. Whatever you kind of want to label it, it's important to have people that care about, you know, the core ethos of what we're doing here. And I actually even put out a recent tweet about crypto entering its practical era. And

unfortunately uh a lot of the practical decisions that are being made in the space uh are are are coming at choosing convenience speed or low cost over decentralization kind of still trying to figure out that triangle of of u kind of like core core parts of blockchain uh in its in its trilmma. And so, uh, that being said, uh, you know, I I I think the the best part about the Ethereum community in the lows, in the highs, is the is the steadfastness in the belief of censorship, resistance, in permissionless nature, in decentralization, in low node requirements, these types of things. So, that being said, we do have a very interesting paradox on our hands, which

is uh, companies like Bitmine and Sharplink. Uh, I think Tom Lee has gone out and said that he wants to buy at least 5% of the supply. I think Sharpink is looking to get three%. And I think it's reasonable to say that at some point in the future, there could be a world where 10% or more of the Ethereum token supply, ETH supply is in the hands of institutions. And and the question today that I think Rob posed and you know in my own words was essentially like how do you think about this like how is it is it better that the institutional foothold with longer time horizons and a deeper understanding of what this technology is uh you know is is it better that that they are able to be able to have such a strong amount of

supply of these networks to dictate governance processes or changes or at least have a say or is is this Is there a point at which this poses a systemic risk to the Ethereum protocol to the e the asset and Ethereum the blockchain? H how do you think about this now that Bitmine and Sharlink I believe have both recently passed the Ethereum Foundation in terms of total holdings which I think is super bullish but uh I think the trend is only accelerating in a snowball like fashion. >> Um yeah sure. So probably one aspect of it is general economic theory uh where I would I wouldn't claim that I can go extremely deep there. Uh sure you think

about what happens with capital over time like uh you you have institutions and people amassing capital and how how resilient this displacement of capital is over over tens of years and so on. So does it does it really affect governance? uh doesn't cause trouble and I I think separately so this is separate from blockchains in general from Ethereum and when you ask about the digital asset treasury companies they bring it and and you mentioned that as well that u institutions are appearing they have a bit more practical focus they will they'll maybe say that they don't think too much about the community

aspect and the the long-term values you need both so you need that pragmatist practical approach to push for excellence on engineering making sure that you can integrate all the institutional uh work institutional flows you need also the the community and long-term vision and I think we're doing great in combining the both uh I I love what happens around uh DS and bringing a lot of education to financial markets they ask about what Ethereum is they they start they start by seeing those new tickers and then they ask questions what is Ethereum How is it governed? Uh what really drives it? Why is it long-term? Why can trust it? And even as you have this u like constant chanting motivation about

the Ethereum success, people people like it as something that drives them, but it doesn't mean this is a capital market. People care about risk. So after after hearing that you feel uh encouraged encouraged to read more and very often you have businesses that say all right this is possible allocation of capital for us hold but what does it mean what are the risks and the you have rating agencies coming to us and asking questions about how we can help them to understand the governance processes uh there are people asking about security and then suddenly for the Ethereum foundation it sets a lot of a lot of additional requirements of communicating clearly uh why everything is safe why Everything is permissionless and that matters. I was um many times I mentioned

now that it's the institutions that start to be the drivers of our own values and come to us and say show us show us the security uh show us that censorship resistance, show us the uh privacy for the customers of the institutions. It's the regulators that start asking about the same things. Uh so finally we have people working together towards those goals. they they start realizing okay in the end this is that global neutral network uh that we are building together and it's combining financial markets it's combining regulators efforts and the community and now you mentioned if it's if it's 5 10% technically u well this is not risk for governance sometimes like the governance

aspects you have the social consensus you have the all the protocol uh parameters and uh you have info where the capital and power is and the whole design of the network is to really balance all of them together and to realize that even for the social consensus that if if some capture of the protocol would be possible just simply by capital then it's still the capital will be really really worried that uh that some some totally uh totally uh sort of like don't want to use bad words but uh irresponsible okay responsible action from the capital loan ers would put that capital at risk if they

face the social consensus. So it's it's a bit like a community revolt, right? That is possible. It's extremely unlikely that you ever enter into this uh dynamics. Uh but because it's possible it holds also some aspects of protocol beyond the technical aspects we beyond the the formalization of the protocol, it keeps everyone everyone in check. So you have digital asset treasury companies that definitely are great for distribution of the of the knowledge education about Ethereum. Uh but they also should be scrutinized on all the risks underneath. There will be some of them um that are probably extremely trusted by the people

involved. some other ones where people are coming with maybe uh either less experience or they're simply rushing that as an opportunity to to make money or simply trying to create a structure that wraps their holdings and I think over time they will differ between each other and there are definitely risks between between them and among the digital asset treasuries and all of that has to be scrutinized and verified for the risk. So uh some optimism it's great it's happening and also some some warning signs here and and as a foundation coordinators will just keep reminding people that there are risks there.

>> Yep. And the Ethereum Foundation early on was a shepherd of the ideology like you said you you were almost front running the institutions now they're coming in and they're realizing what Ethereum is and what it what it could do. regulators are coming in and they're asking these questions about decentralization, censorship resistant and these were ideologies the the Ethereum Foundation and the early innovators of Ethereum had in their mind and they they were the pilgrims that spread this to the rest of technology, finance, the this industry as a whole.

And so couple that with the institutions coming in, the regulators now taking notice, and the other fact Andy brought up in his previous question about now these institutions in terms of uh capital and weight with respect to the Ethereum network, they are now surpassing the Ethereum Foundation in their ETH holdings. So I'm curious, how do you see the Ethereum Foundation evolving as these other entities start to take a greater role in the network and Ethereum Foundation seems to have a lesser role? How does how does this play out?

>> I I don't think that Ethereum Foundation was ever using its uh its Eve holdings as a way of uh of promoting the the values. We're using really the legitimacy of the researchers and thought leaders and u the money is there to to spend on the operational expenses uh to cover the team within the foundation to support institutions uh that were that have been spawned over the last year years and needed some initial funding to to become independent from the foundation. So that's that's where very often the the funding was directed. So now when you look at the foundation's treasury which would be

probably around $1.1 billion and um and you say that some some of the digital asset treasury companies will uh will will be beyond that like their holders have more EV but neither we are using that for governance u nor them necessarily using that for governance they have limitations like they can stake obviously the EV but does it mean that they will have much more to say than the general protocol voting but then it's I'll call it 10% it will not be it will not be 33% and it will not be even if it's 33% it will be distributed among different holders and then this is just capital but there's still uh a very

strong influence of the alore devs of the researchers of the of the those who believe in the values and just activate further influence because they are fault leaders. So all of that balances and I don't think it's a any shift in the foundation role just because its holdings are lower than holdings of others because we're not using those holdings for governance. They're just like for for paying the expenses and also foundation doesn't really assert the central role. It hasn't had the central role. It has this role of filling in the gaps. uh it was less visible in the in the last years when when maybe it was uh a bit risky to be uh to be too visible uh but it's it's

more visible now but also because it understands that there's so many other organizations are visible so it's so clear that we are not central that we're just like one of many uh one of many institutions some of them are more business focused we are more coordination focused and and guidance and research uh so that role maybe uh you will have maybe nosis, maybe nomic and a few other foundations really work on on ZK research and so like zero xpark and a few others and they all serve that role but maybe not in combination of like research and governance coordination. So foundation is sometimes unique, sometimes just one of many.

>> Yeah. Yep. >> Yeah. And to your point, the foundation still has probably the largest base of intellectual capital focused on scaling Ethereum. And to that end, the Ethereum Foundation has outlined three focuses, really three priorities uh to to to really just continue to scale Ethereum to the extent that uh we all we all know it can achieve. And those three are scale the L1, scale L2s, and improve UX. This was part of a thought piece. I think Vitalic might have put it out. It was on the Ethereum Foundation blog, and it highlighted these three priorities. And so, you know, because we have this based rollup,

a native roll-up live stream that's going to be continuing throughout the day. We're going to drop a market map. I'm curious of those three, scaling the L1, scaling L2s, and improving UX. Why are these the three most important priorities for the Ethereum protocol and how do based rollups and and and native roll-ups help us achieve one or more of these areas of focus? >> Sure. So we we set those three priorities for one year starting around uh April this year which means that we are almost like half halfway through and really it spans over the two forks of well starting with Pectra in May and then you have Fusaka and then you have

Glamsterdom. So it's like two or three forks together. Uh Glamster may come slightly later. I don't know if they'll be March or June. The this three priorities were selected based on the the drama mode feedback from the ecosystem combination of knowledge of uh about cords and researchers of what really matters and how we can create some synergies and it doesn't mean that this is something that we'll continue talking about uh two years from now or even like one year from now. We start talking about the next priorities based on the refresh of uh what's happening now. So this is more tactics uh behind the values of thinking always about the the privacy s c s c s c s c s c s c s c s c s c s c sensorship

resistance security of the network uh this is always there as the base then you have some like let's say 10ear strategy of where it what big problems Ethereum is solving and we started talking about it slightly during 10 years of Ethereum and we uh for now we were a bit more quiet about it not to distract people but but we talk about some big problems ahead of humanity and vision and then you have maybe three years uh view which is what we do for the next generation of protocol and then you start talking about lean Ethereum and what Justin Drake is talking about and look maybe more in if if research topics uh and then you see those like one year

response to the the problems now um and some of them are technical and those are talking about how to make a credible commitment of scaling L1 on for for the L2s, how to uh how to scale it to directly for the through the blobs and how to solve all the questions around interop and UX. So so really there is clarity that is a single ecosystem between the L2s and L1's and whichever one you choose you can connect and you can move the assets and you can move your deployments of applications pretty easily and you can use the the same tooling in many cases. Not always is like a a perfectly comparable. Some some of those chains on the L2 level will be

EVM chains. Some of them will be non EVM. Uh some will go just more standard rollup direction. The other ones will go with this base and native rollup. And you're asking me about base and native rollups. I think they add a lot of uh additional flavor and choices and options for for some very important cases. Like nowadays some of the institutions will come and ask so if if we are to launch an L2 which uh which to choose like which ecosystem to choose within the L2 space uh how to do it and with the base and native rollup some some of the solutions will be just much more no-brainer easy to deploy. It'll be not focused on community and branding

and innovation like very often it is with little tools and it matters and we benefit from that a lot like that distribution through a fashion of branding to the approach of community or maybe regional focus is what makes Ethereum unique nowadays and with native rollups you'll have this bland roll up like very very L1 aligned that is just focused on okay just just deploy a rollup we need it for our internal processes or we need to connect to the network something that we already have that exists and the institutions and and independent operators or maybe so people who will be operating agents and AI will be able to choose which flavor works the best. Uh yeah.

>> Yeah. And just one followup on this is we we've seen some institutions like Stripe, they've went and they've launched an L1. Circle, they have, you know, said that they're going to launch an L1 and a lot of people on crypto Twitter have said that these guys in the long run are going to end up switching and being an Ethereum L2. So I'm curious, what's your pitch to these guys? Like why should they be Ethereum L2s rather than be their own L1? >> Yeah, sure. So you've seen recently some of the L1's transitioning to to Ethereum. So you've seen Sillo and uh they now very clearly say they see better numbers, better adoption, better reaction of community and that that

helps them to succeed. uh you've seen recently Ronin announcing that they'll be switching to D2 and there is that question this this uh aspect of of beating for which ecosystem to belong to which which maybe is u less less of something that I would like to to see and then you have uh then you have those L1s for for payments for stable coins that been launching recently and people would say it transition to L2 and I think that there is a bit of preference for oh we'll get the L1 premium uh then maybe we launch something and then there is always space to transition to L2. I think that we

should maybe also start talking of this direct direct Ethereum ecosystem premium like not not going around and not losing those years of just just being maybe like less openly adopted by everyone because you just keep claiming isolation from from the ecosystem. they they're not really isolated like they're launching and they say we'll be EVM we'll be bridging to Ethereum we'll remain very close to Ethereum ecosystem and it happens like so even within those organizations you will see many of the researchers technologies or or business people will be uh saying behind the scenes you know like we we still working with Ethereum we're still the ecosystem

that we're choosing and we're launching L1 because of this or this or this which means that they feel that they feel there is a a tension between those choices that they might be putting something at risk that they don't want to lose the community support. They don't want to lose that power of of leadership that comes from Ethereum from Ethereum ecosystem saying they're one of us, right? like so so it's never like like walking away entirely and that's why we probably have that conviction that at some point they're switching to O2 and we maybe should start talking more and more often about why sometimes or very often this will be a mistake to not go directly in that path of of just being very clear we belong to ecosystem

it's not only EVM but it's also uh all of the values global aspects interoperability that all of the effort And research improvements that will come from the uh not only from the foundation but the entire ecosystem is something that will drive their technology forward. And if you go alone that suddenly you realize that they launched a chain and then another institution launches a chain and another and then suddenly they start competing with this uh if you're successful there will be like 20 or 30 of those corporate chains institutional chains and those start u doing the same that what we see everywhere else like you you're launching the video streaming uh company and then you start fighting for the exclusivities for uh you blocking some

content And and at some point people say, "Oh, maybe I just go back to piracy like 10 years later because the entire market gets disrupted and you have some great UX very often and some market is covered but then you start competing regionally and and I think that's might be the case here as well. So choosing Ethereum I think you go to this global uh platform immediately. So that's where the conviction comes from. uh sometimes this will be reasonable business strategy for for some more regional or niche market. Sometimes it'll be great for for some period of time but will not have the same guarantees of never disruption. Um yeah it's but also like launching a major investment bank nowadays and saying that you no actually

you don't go with with digital assets, you don't go with blockchain, you just build a traditional system as well. That's that's much more extreme case and maybe it's not a good analogy. uh but you always can get some temporary premium but you're not coming with the same guarantees of of global neutral network. >> Um Andy, I think you got your >> I think that's probably what a lot of of the logic ended up coming down to be. Um Thomas, thank you for for kicking us off on the based rollup day today. Um hope you enjoy the map of the teams building uh in in the based ecosystem. I know uh we're kind of coming low on time here,

but yeah, any closing thoughts for the teams who are building base rollups for Ethereum? >> Um I think that that's clear there's uh support for base rollups like the there's coordination around it. There is uh lots of excitement. I think that when you think about base rollups though um one year ago it was it was like in the in the middle of creating all the new directions and and innovation in the base rollups and then maybe in the last last months on one side there is continued coordination some teams are already deploying uh lots of those novelties but also maybe you've heard in some areas you've heard less about base

rollups I think this should not be discouraging But there is there's lots of support for that. It's it's part of this strategy uh longer term and and it'll be probably extremely relevant for many of the of the institutions. So there'll be there'll be market for base rollups for native rollups for sure and and even as we talk about the broader ecosystem L2s that shouldn't be discouraging. It's just that we see all of these flavors of Ethereum very relevant in many different aspects and they'll find their own uh users uh their own deployments and their own revenue models.

>> Awesome Tamas. Thanks so much. You speak of the gravity of Ethereum. Ultimately, it is this black hole, this sink for intellectual capital, social capital, financial capital, all of it is coming to Ethereum. And uh you are its shepherd and its steward. So, thank you so much for coming on and uh sharing your time with us. >> Thank you so much once again for inviting me. It was great to be on the podcast. >> Thank you. >> Awesome. >> Nice. >> Cool. Cool. Um Leo is goddess. >> Way better that way.

>> Yeah. >> All righty. >> There we go. >> What a great segment from Thomas. I mean really really enjoyed that one. Uh obviously we did that yesterday. It was fun. Um, and yeah, I mean today we're gonna just continue the base roll live stream. Rob, good to see you. Good to have you back. Got a ton of guests today. We just dropped the market map. It's about to hit 50K views on X. Our first guest is Lewis. Our first guest is Lewis uh from Gelato and um yeah, we will get him up and uh we're going to roll with it. How you feeling Rob?

>> I'm feeling great. It's another good day. Beautiful day in Florida and uh beautiful day in Ethereum. Obviously, we're going to be talking about based roll-ups and native roll-ups today. I think there is some debate on whether or not the uh future of Ethereum scalability comes down to based roll-ups. Um ultimately, we're seeing a ton of action on Ethereum in multiple different ways. We're going to hear from a lot of Ethereum leaders, founders, and builders, uh such as Lewis from Gelato, who's going to be coming up next. and pretty excited for today's stream. It's been a little while since we got deep in the technical weeds and it feels like we're getting back to our roots. Andy.

>> All righty. Well, we we've got Lewis, so we'll we'll bring Lewis up. Um and um yeah, Lewis, man, it's you you're following up the uh great Thomas Stack. I cannot pronounce that name. Uh but you were the first one today here on the bass robe stream. Thank you for your collaboration and contribution in helping to get this all together, man. >> Thank you guys. I'm very glad to be back and I'm sorry I'm forcing you guys to talk about infra again. I know you guys want to talk more about apps probably, but here I am. Infra is back.

>> Yeah, we have been. I mean, we've definitely been expanding our scope of uh of just kind of conversation topics a bit more of the stuff that's happening more in the in the current. Uh I'm just curious how your podcast is is going, man. I saw that you guys have been recording some episodes. How how's that been going? >> Yeah. Uh it's actually a lot of fun. Um I sort of started that like very on a very sort of loweffort basis about one and a half years ago and I just realized that a lot of times in um at my job I was basically having really good conversations with other founders just as we were integrating products and so on. So at some point I just decided to hit the record button and post them. H and yeah if if you guys don't have infra

fatigue these are very long very infra focused podcast. Usually we have a lot of content there around gelato infra but also around rockus defi sort of market making side. So yeah very very deep dives with with justma and I from the gelato side talking to other founders. >> Very cool. Well, one question that I got from the market map so far has been uh you know in the subheading that there's a line that that that reads building the future of Ethereum L2s. And guys, if you haven't seen the market map, uh it's in the comments on the stream on the main pin link. Check it out. Uh there's 50 plus teams. It's really a good showing of teams that are building to kind of

scale Ethereum while keeping the kind of properties of censorship resistance of the L1 uh of L1 sequencing. And so, um, yeah, Lewis, I mean, the question that I received from a couple teams was like was actually like, do you believe that base rollups or based and native roll-ups are the future of Ethereum scaling? And so, I pose this to you. Right now, we have a lot of these, you know, typical single sequencer L2s. I, you know, I think Starknet actually recently just pushed out a more decentralized sequencing set in their Grinta update. They had some, they had actually a small outage. Um, but now it feels like we're getting closer to this next era of roll-ups and L2s. And so, you know, do you firmly believe that based or and/or native roll-ups are the future of Ethereum L2s?

>> Uh, I think they're definitely a very important version of the future. And I think there's a flip side to this where the whole block space rollup market will look vastly different from what it looked like in the last 2 three years uh in like let's say five years uh from now. Um I mean recently we've even seen a new trend of L1's sort of old L1's coming back with stripe and circle and so on. I think ultimately these models will likely not win against the roll-up model uh because u of basically the cost uh efficiencies of of using rollups. Um and essentially when you're building an L1 you're trying to usually build a valid data set and with a rollup uh you

can get like the same amount of sort of decentralization for a much cheaper cost I would usually argue. Um so you can essentially rent validator sets as a rollup. Um so I think but overall whether the like I think what's very important to say is what we've seen in this let's let's call it the first wave of Ethereum O2s I don't believe is the future of Ethereum R2s. However some rollups we've seen in there are like they don't care about Ethereum. Um uh they they are already sort of pretty much well served by what we have today.

It's interesting because I think Ethereum sort of led that innovation and and then nowadays you also have others like Celestials who are really pushing pushing the envelope. Um but it's it's funny like it's almost ironic that a lot of the rollups that work today. They work well when they don't really care about Ethereum using Ethereum as a settlement as a true settlement layer like it was initially intended for using Ethereum for for asset issuance. Um actually originally before we posted this space ecosystem map that we're talking about today I also posted something on ETH research uh um yeah what streamers should should watchers of the show should go look that up on Ethereum research and there I have a bunch of data in there we also publish

some of the data with block works uh where you can see exactly uh how little Ethereum is actually being used by the current day sort of poster children L2s >> or it's yeah exactly Okay. So, so, so, so basically to wrap it up, I think um Ethereum true Ethereum rolls are pulled through today. That was mostly due to the tech not being ready. But now with base rollups becoming ready or being ready with ZK with teams like Succinct and and with Zero ZK finally being ready, we can have a wave two and this time around you can have true Ethereum L2s.

>> Yeah. Yeah. I mean, so you guys wrote about this idea of like Ethereumness is kind of what you're getting at here. And you guys ended up coming up with this idea of a Ethereum settlement score measures. How much L2 users slash assets truly use Ethereum for, you know, what Ethereum is good for, settlement, censorship resistance security etc. And basically, you guys came to the conclusion that the current state of L2s score poorly in this c, you know, in this measurement. Um, you know, you wrote about some of the of the reasonings here. You know, what are you what are like the top two or three core parts of a um L2 right now that you believe get it far closer to

Ethereum's a higher Ethereum settlement score than like a arbitrum base, optimism, uh, abstract, etc. are you know what is it? Is it about the uh canonical bridges multi-IGS? Is it about um just some of the sequencing properties? What are the core properties that you are looking to uh really evaluate these these L2s on? >> Yeah, I actually got that pulled up next to me on my screen here. So I I I'm going to make sure I'm I'm going to speak accurately. Um so first of all in in the Ethereum settlement score which is a motion and a sort of new scoring system that I came up with by

incorporating a lot of empirical data that we gathered as a rollup as a service provider. Um when we launched rollup as a service at Jelata two years ago, we understood L2s and rollups like very differently to what we then actually saw in the market, right? And uh like under the Ethereum settlement score strictly speaking um you can score between zero and one and all of the rollups today even arbitrum evenbased they would get a zero because they all still heavily rely on on multisix and security consoles upgradability and like that's like Ethereum we can all agree on is not a multisc right like it's actually a decentralized network. Uh so but um you know and again I'm not here to shame any of these rollups like I

think a big factor was that they were all super early pioneers and the tech simply wasn't ready but now there's a bit of this inertia and they're like everybody's not comfortable they all have a bunch of TBL they're all somewhat sovereign um and they don't really need Ethereum technically so much anymore because you know they they all went pretty far on their own uh and uh I think now with this new new technology there's a chance for the old rollups to update the systems if they want to or for new entrance to become the next big Ethereum rollup uh by embracing properties of uh you know immutability again um in the sense of that there's no like security council multi core rollup that or like yeah basically that's like a core property and that's that's the

key word here are native rollups like native rollups are even earlier in research and development than based on DK um but native rollups will are going to be the I think the biggest unlock to really bring Ethereum settlement back to the L2s where actually uh the the rollup itself will be sort of verified um on the L1 and and ZK is a is a very big um enabler of that as well. Uh but apart from that um apart from native rollups and sort of getting rid of you know upgradable smart contracts and having the rollup straight transition function um execution be enshrined on the Ethereum one that's native rollups.

Apart from that, um what's really important is um based uh base rollups. That's why we have the the base ecosystem map. Um because base rollups essentially say that um you use Ethereum for uh for lightness and and central sensor resistance guarantees to the max. Um that means that when you're like when you include a transaction on the rollup, it's almost in real time also included on Ethereum R1 uh with pre-confirmations and so on. So um yeah, even if you have a rollup with whose state transition function is verified on the L1, um you still want that to happen in real time almost and and that can be done by

having base rollups. Um and essentially bringing s like force inclusion times from I think nowadays you already have pretty good ones on arbitrum like 24hour windows or something or maybe a bit longer. Uh base rollups are are about bringing that down to to like real time or Ethereum work times. So that's why in the ESS framework the most important factor is sort of becoming based if you want to score highly um native is a precursor you need you need uh and then then the other weights that you can find in the formula there that I'm referencing on my E research post are like empirical things like hey is your rollup actually using assets that were issued on Ethereum uh because the whole purpose of a rollup is to have assets to use Ethereum as an asset issuance layer

actually Vitalik also talked about this recently um and then sort of move assets from Ethereum into the rollup and if the rollup malfunctions you can get them out on Ethereum again. But if you look on my data like that that we found there uh today you will find that actually most of the assets on rollups on Ethereum R2s do not originate on Ethereum. They are either bridged in via like layer zero of TS or circle use CCDP or they're even natively issued on the rollup itself like Kaio for example the KTO token is on base right and there's no reference of that token on Ethereum so for for all intents and purposes Kao treats B like an L right um so so yeah like um it's very important to measure like the

actual the actual way the rollup is being used in terms of asset flows ins and out an issuance and that empirical that's what makes the ESS Ethereum settlement score so cool because on L2B today you can get all green slices like this fuel V1 rollup does it has 80 like it was the first one with green slices but it it has 80 bucks in it no one uses it so have they really achieved anything not really where the ESS score you really can only get a high score if your rollup in practice in production is actually using Ethereum and the users of the rollup are using Ethereum assets and and canonical bridges So yeah, um and in general like me, like this is not like pure Ethereum maximalism or something.

This is just a way like I I would say to like Sunlight is the best disinfectant. This is a way for Ethereum to become honest to itself again and to have a way to measure how good Ethereum actually is at at making it settlement services available. And to be to be fair to the to the current day or two, Ethereum really sucked at a lot of that. But now Ethereum can become much better because base is getting ready because we have ZK because native is coming. Ethereum as an exporter of sensorship resistance and security will have new technologies available and then we can use this Ethereum set score to measure um whether the rollups actually leverage those and and I think as Ethereum participants we can use this to to actually score Ethereum and not just the rollups on how

well Ethereum does on its mission statement, right? Yeah, absolutely. >> No, it's great. I think what you're doing is you're you're going in and looking at the way that we're analyzing these rollups now and acknowledging that it's not perfect. L2B has done a great job. They may join the stream a little bit later and we can talk through what upgrading some of those slices could look like so that we have a more granular insight into the security and the sustainability of these roll-ups on a more practical sense. Because you're right, it's a little bit ridiculous to have all green slices with a with a rollup, even though the fuel the fuel guys are great. Nick is, you know, a great founder over there. They're doing things with V2, but what's the what's the value in having Fuel V1 with $80 TVL with all green slices? Um, the last

thing I I I want to ask of you, Lewis, before we kind of get get to the rest of the uh people joining the stream is Gelato what what have you guys been up to? A lot of the things that you guys have done has been to put roll-ups as a service through the industry and now to spin up a lot more roll-ups and now we're looking at the UX, we're looking at the interoperability and we're seeing more ways to connect these together like you said with ZK uh as well as with other things. And so how are you guys helping to push the rollup ecosystem and the rollup centric roadmap of Ethereum at Gelato and and everything that you guys are doing to support your clients?

Yeah. So actually uh we Gelato started out with what we called ZK Ras back then because the first framework that we supported two years ago was the Polygon CDK which now has is has been deprecated and we were like Polygon and us we were a bit too early on the ZK front. We noticed that and we were like the first wave of ZK EVMs there. We had this this chain AAR network. They now have an OP chain with Sonium um the company behind it and um what we're always in production right so we are at the leading edge and we we very quickly notice what what real customers actually leverage um what's what's valuable for for them and what not. I think what's changed is like while we

worked a bit too early with ZK two years ago, I definitely feel like 2026 is finally going to be the year that ZK is going to happen in a big way for rollups with new technology like the one built by Sing for example and of course a team that we also work with closely. So I'm very excited for ZK. I think all of Ethereum is right. Like it almost feels like Ethereum on on my timeline recently is sort of rebranding overall as like a ZK ZK thing now, right? Because ZK is such an amazing technology. I I I do however feel like it's very important to create this urgency and and uh to to have people understand that they now need to go out and and actually do it, right?

And they actually need to deploy. So it's always a bit of like who's first, right? um and who's going to be the first to be successful. Uh one way that we also really help I mean with native rollups you can't really do much anything today it's too early that's in research but with based we have already concluded internal test nets um with Kraken Inc. for example, uh we recently upgraded their OP chain to to Flashbox, but they they're also really interested in trying based rollup solutions. Um so we we're working on test nets with them, seeing how inkchain could potentially become based in the future. So really big companies like Kraken that are really at the forefront of trying out these new techni Ethereum technologies that uh

even though Kraken like you know as an enterprise chain I think they can very much do very well on their own with the existing ro technology because they have a huge exchange that they will connect to that chain right like they have an amazing product line coming up soon that will connect to INC um h but they are like like they are very crypto um you know OGs and they they really want to do more than just be an an enterprise blockchain. They want to be at at the bleeding edge as well. So, so yeah, they're we we're really getting, you know, our hands dirty working working with them, try trying out the the state-of-the-art technology in terms of base, in terms of CK. So, so yeah, I I expect that next year um we will be really pushing for it. That's why I'm on

the live stream today. I want to create some urgency around this topic because Ethereum has momentum again, right? like um Tom Leo or whoever that guys is pumping our bags. So now so now I think it's time to to actually say like look sure Ethereum is going up again but actually a lot of the critiques of around L2s the L2 road mapap were actually right right just because the price is going up doesn't mean that we should be complacent now's the time to leverage that momentum into into change. Yeah >> I I asked Tom uh Tomas the same thing and we just and I just put out a tweet about it. you know, ETH six months ago had all these issues. ETH now has no issues. But the thing is, uh, not like materially in the tech wide, in the tech

side, you know, there's still a lot of work to to do. Just because Tom Lee is buying all a ton of ETH does not mean that uh, you know, the same problems that we were facing last year don't exist this year. Lewis, thank you for helping put this together, for being the first live guest today, for creating this Ethereum score. uh looking forward to kind of seeing more and more uh of of how this plays out and thanks for pushing the agenda today, man. >> Thank you. And I just want to give a quick shout out to L2B as well because I'm really drawing a lot on what they have built and I'm just sort of mixing it up into a new score which I think hopefully they will find useful and they will include on their own page. And also shout out to you guys. Last time I was

on this uh podcast, it was very different. And I actually started watching your live streams recently and I I get the dopamine hit where the music kicks in. I love the the whole look and feel of it. So So you guys Yes. >> The world is trending in this direction. You you you open your phone and you're not doing anything. So you open Twitter and look looks who's live. Might as well hop on and listen. >> So thanks Louis. I appreciate you man. And uh we'll speak to you soon. >> Thank you guys. Thanks for having me. us. >> That was the very first based rollup segment of the day, breaking the breaking the news on the Ethereum uh Ethereum settlement score. Uh new kind

of mechanism to think about how roll-ups are using Ethereum's core properties. Up next, we got Simon from Rhea. Uh again, this is another base rollup team. This one actually is building a base rollup on Ethereum. a very functional high performance per deck. Um, Simon's a good friend of the we invested in Rhea many well over a year ago now. Um, and yeah, stoked to kind of get some product updates, understand how Simon's thinking about some of the technicals on Ray and more. So, I think he's ready in the back.

We'll pull him up and yeah, let's talk base rollup. Simon, welcome to the uh Ethereum is based mega stream, man. Good to you guys as well. Thank you for having me. It's uh you guys have got a marathon today. >> Indeed. >> Yeah, we've got a journey ahead of us. >> Yeah. >> Appreciate you joining us. >> Yeah. >> Yeah. You're the first actualbased rollup today. We had Tomas of Ethereum Foundation. We had um uh we just had Lewis from Gelato on the Ethereum settlement score. Um, so maybe just a quick intro on what Rya is and why you chose to build your design for your product in such a way uh that you did.

>> Nice. And you're looking tanned Andy. There's a life in Hawaii >> surfing daily. >> Yeah. So I mean the first thing I would say is that rare. So we already have a live product rare is a deck, right? Like we already have a live product um that's built using arbitum orbit, right? It was a very deliberate first step to try to get to like what we see as very much the end state which is the base role of design. So we've announced probably about six weeks ago now the design for what we're describing as rare chain which is going to become the world's first application specific based rollup right so we've got general purposebased

rollups we're building an application specific one where the app is indexed right like and what like why are we kind of taking that path well like what it effectively allows us to do is at a macro level, it allows us to enshrine a DEX into the Ethereum L1 effectively. And what that enables is it enables a trading experience that is millisecond level fast. So it's as fast as Trafi, but it is on the other side. It is as decentralized as Ethereum. So we've essentially been able to deliver what is a holy grail in terms of DEX design where it is both fast and decentralized,

right? Like which kind of lots of people have been trying to achieve for a very long period of time, but you could only do that with a based roll up. And then on top of that, what's really powerful is by being based, you earn or you effectively unlock uh synchronous composability with the Ethereum L1 and with other based rollups. So, even if you just keep it as a crypto only kind of like thing, which honestly I really don't think it is. I think it's like a Wall Street thing. But if you keep it as a crypto only thing, um the product which we're going to create is going to be faster than any other decks out there. It's going to be more decentralized than some of the best dexes out there and it's going to be atomically composable with the entire

ecosystem that exists on the Ethereum one. Right? So they're not the only things that are required to build a great exchange, but as foundational layers, it is extremely like strong as like as the set of foundations. >> So Simon, I put out a tweet that I think is really relevant to your idea here, which was about it's actually from perpetual pulse.xyz. Not sure if you've seen that site from those tweets that I was putting out about like those screenshots of of the notion, but basically the tweet was around perexes being the best businesses in crypto and that they appeal also to technical people. Uh, which is great.

And and so I wrote that you should absolutely know if there's an escape hatch for your chain. In this example, like Hyperlid doesn't have one. you know, Hyperlid it it has no escape hatch in in in the sense that if something breaks, there's no way to like, you know, force your capital out. If there's a centralized sequencer basically for latency racing, so if you can be very close to that and you know where that is and it's not a a you know, a rotational set of colloccated sequencers, then you have an advantage. What a centralized matcher means, you know, and the differences between soft finality and hard finality. I just I think that these are the these are the trade-off spectrum that you're kind of operating in. But basically what you're saying is like

okay we've we figured out that that this design that we've laid out for ray chain effectively navigates each of these in the best way possible such that we have a secure um you know censorship resistant chain but also can optimize for performance. And so maybe you could elaborate just briefly on some of those specific technical things uh that I mentioned there uh if you know if you will or just broadly kind of how you're thinking about uh that trade-off space a bit deeper. >> Yeah. So so basically every single DEX today has had to make a decision as to whether they want to optimize for decentralization or optimize for speed, right? And there's there's a spectrum of I mean I can reel off a whole load of

examples but if you go towards speed then historically you've had to make a trade-off on decentralization but hyperlquid being like the most obvious example they start off as four colllocated nodes and they're able to be very fast but like four nodes is not particularly decentralized. Um, on the other hand, you could go and build something as a set of smart contracts in the Ethereum R1 and you are going to be as decentralized as the Ethereum R1, but the Ethereum L1's not built to for trading, right? So, it's never going to be fast enough to effectively allow price discovery to happen on chain, right? So, you're making a trade-off that point that you want to be decentralized, but you're you're you're not going to be fast. you if the

Ethereum road map effectively unlocked the ability for people to um decouple execution trading execution from consensus right so even like one of the criticisms of hyperlquid long term is that they propagate all the trades through a consensus mechanism so as the node validators scale right like you are kind of effectively going to add latency because you have to propagate each of those trades through the consensus mechanism in order to actually like reach finality. the Ethereum road map like broke that relationship but it came with some trade-offs right and that's where you started having things like escape hatches right which were

introduced and also like what you lost is you lost composability with the Ethereum R1 and what a based rollup does which for me is like the massive breakthrough is it allows you to have something that is millisecond level fast. So what we have is we have um a set of execution nodes right where they are able to um kind of essentially build L1 blocks through a similar mechanism to PBS where the Ethereum L1 validators are delegating responsibility to those execution nodes. So you have a set of these very highly performant beefy machines that are running these

execution nodes. So they can be extremely fast, but because they're inheriting the delegation from the Ethereum L1 validators, you are effectively maintaining the decentralization of Ethereum. So you you effectively end that trade-off between being fast and decentralized. >> Yeah, >> it's a beautiful thing, isn't it? >> I mean, >> it's very nerdy, but it's beautiful. the blockchain trilmma was real for so long and now it's seemingly solved with based rollups at least to a certain extent and and from my understanding the last time we spoke you guys aren't just building this vanilla based rollup there's other elements to it that kind of go beyond what just using the Ethereum L1 as the sequencer you mentioned like the the

execution nodes what are some of the other features that you are able to enable something that consumerf facing there's a value in you know a further use case than what you were able to provide as a roll up on arbitral orbit >> versus arbitum orbit is >> yeah so so so number one I think it's going to be faster just way faster so you can achieve millisecond level trade speed and if I just explain that very briefly so you have the ethereum L1s they delegate responsibility to build a part of the L1 block to an execution node so like proposal builder separation right and then this execution node because it knows it can include transactions in the L1 one block when you as a user come along and say hey I want to execute a trade it can give you

what we describe as a preconf so preconfirmation straight away back to the user and say I'll include that transaction in the L1 block right so immediately you're able to move from block production to effectively streaming of transactions right and you're able to do that with um a different level of guarantee that is about to be included in the L1 blog Right? And you at that point effectively have 12 seconds to finality because it will then go into the L1 the very next L1 block. Um so as a user it's faster but then alongside that you have different livveness and censorship resistant guarantees versus a centralized sequencer. Right? So because

we have multiple execution nodes, if one were to go down, another one would become the leader, which doesn't happen with the current version of arbitr orbit, right? And then alongside that, obviously from a censorship resistance perspective, if one were to get shut down, right, like you've got other execution nodes that you can move to as well. So, as a user, you've got these like long-term like effectively got the short-term benefit of being fast, you got the longterm benefit of it being more reliable as an exchange essentially long time.

>> So, in specifically about the per uh business for Rhea, I have a broad question about why this matters in percussion about Rhea. I put out this tweet that was like hyperlquid had this many had this much volume in 24 hours and then lighter had this much and I think it was like five billion for hype and then lighter was like 4.5 billion and people were ramming me being like dude doesn't matter lighter has zero fees their OI is like 120th of hyperlquid blah blah blah so like maybe you could explain to us and to the audience why does OI is OI the metric that matters in per why is open interest the important variable of the value of a given per

platform. >> It's effectively a a measure of how much um like kind of like uh how much the platform is supporting like trader opinion, right? Like is is probably a bad way of describing it, right? Like so so volume is something and I guess within that volume is something that's very easy to >> like wash trade. If your trades are freak, you just go back and forth, back and forth, right? But holding OI means you're holding risk, right? So if I've got an open position of a billion long, right? Imagine James wins back, right?

Like a a billion long on ETH, right? Like then I'm actually holding exposure. I'm holding risk, right? So, it's a it's a better measure of um how traders perceive the product and whether they're willing to hold risk on that exchange. >> Got it. >> Just back and forth. >> Yeah. >> Because there's a there's a time value money factor into this equation where >> and there's a funding rate and whatnot. >> Yeah. >> Yeah. I mean, honestly, I think both matter. You can have loads of OI and no volume and I don't even know what that means, right? It just it sort of means that you just got people with positions haven't closed or something.

>> Yeah. Like longer term positions or something. >> Yeah. But like it's um so I think both matter, but when you're fees are free. Yeah. Definitely. >> It definitely creates opportunity to manufacture volume. >> So you got yourself one of the best businesses in crypto on your hands. It's pretty much like pumpf fun launchpads and perexes right now. It's like there's really not much else. I mean there's two tokens on the market that are doing significant buybacks right now. it's pump and it's hype. Um, there's going to be a lot more per platforms launching tokens. Rey is obviously pre-token. I'm just curious like you've been building this for some, you know, I mean, we invested maybe a year and a half ago.

You're building this a whole probably a year prior to that or more. you've seen like this entire kind of wave of of different uh philosophies as to generating revenue and doing you know different kind of ways of supporting your uh shareholders, token holders, etc. Like I'm just curious more from the business perspective uh how are you thinking about now that you've seen kind of this unfold? How are you thinking about the the future of of the REA network being a sustainable profitable business returning that value to shareholders or to token holders or just building out this kind of flywheel that you know we've got the REA machine that is the per stacks that gets to billions

of dollars a day in volume then you've got the REA asset potentially in the future sooner that than later I don't know but like how how do you think about this like sustainability of this model and what What are your current like business uh uh philosophies around it? >> Yeah, I mean Perbex is hu generate huge amounts of revenue, right? Like there's and and you guys invested Yeah. probably about a year and a half ago or something like that. Before we launched when we went live, we were originally kind of pushing the network a lot harder. One of the things that we've changed over the past 12 months is we've pushed now a lot more just into the exchange and just focusing on that. We kind of had two products at the beginning and um for anyone that's following very closely I

mean we've we've like the numbers have have just turned the corner over the past four months. So what people probably don't know is I have changed huge parts of the team. Hired people from Wintermute from big trading firms like Optiva changed engineering leadership changed the person leading marketing right and all of that's paying dividends now in the fact that over the past four months we've what more than 10xed our volume from a monthly basis. So there's it's everything's heading from our perspectives everything's heading in a really positive direction and um when we roll out this based roll up which is going to be the first of its kind it's we obviously expect that to accelerate but from a revenue perspective yeah like I mean perexes

generate huge amounts of revenue we've uh got our tokconomics designed we haven't announced it but one very obvious thing that will happen there is that the revenue will go towards buying the token, right? Like, and that effectively creates a whole lot of kind of buying demand for the token itself, which is driven off the revenue. >> I mean, the beautiful thing is that it creates a bottom for the token. Like, it creates a a floor. >> Yeah. I mean, we're going to do just wait till the token always come out, right? We're going to do something that's definitely different and um I think going to be a first for the space, which I'm very excited to like announce, but I'm not going to do it right now.

And uh it's uh I mean it it it creates it creates buying demand for the for the asset, right? That's just fundamentally what it does. >> Yeah. I mean I think uh we had um last last thing here for you. We had Michael from framework who I also know invested in rhea and we were speaking about the different um Rob is like PTE ratios like the like the way to think about what the value of certain uh yeah of certain assets are >> price to earnings ratio. Yeah. And I think the S&P right now, he was saying it's at about a 12 maybe or a 22 or something uh in terms of like uh it's it's at one of its highest valuations based on the amount of earnings and like actual uh revenue being created in the market. And then you you look at some of

like the like these revenue plays and you know they're appealing at like a 2x that at a 5x that I don't know if it's that really that appealing but he kind of made the case that you know these crypto protocols that are generating similar or or you know a revenue uh structure can can probably be modeled at a more aggressive ratio in terms of price to earnings uh than traditional stocks or traditional equities just because such a small market still it's like per can be >> yeah and those are the up. So this just I don't necessarily think all token prices follow that like level of formula but there's um just people typically have higher price to earning ratios if they believe the growth potential is higher and um

particularly from our perspective right like just if I talk about rare um Ethereum is being adopted by Wall Street as the settlement and custody layer or self custody layer but if you want Wall Street to move on chain, you need price discovery to come on chain too, right? And what we are doing with Rare is we are creating a the kind of first DEX that's ever going to be effectively enshrined into the Ethereum L1. And what that unlocks is it unlocks price discovery on the Ethereum L1, right? And therefore enables us to move the whole of Wall Street on chain. So yeah, look whether Ry gets priced based on price to earnings ratios or not, I don't know. But the reason it would be

higher is because of that huge growth potential. I I think what you're describing and this might be the last question before we let you go Simon is that um as Wall Street moves on chain and that's measurable like you know Arthur Hayes put together this piece on why he thinks hyperl is going to you know do a 500x but it's effectively the same valuation as Rya more you know you got secretary treasur treasury secretary Bessant three trillion stable coins on you know in circulation by 2028 right and the idea is that as more of these stable coins become incirc circulation that translates into volume on these dexes and into per volume means more revenue. And so is is this sort of like your fundamental equation that's going

on in your head as well is like okay if we can get a certain amount of volume as a result of increased in stable coin supply which is coming on on chain because of a you know Wall Street coming on chain and that equates to greater stable coin supply. Do you kind of see it that way or is there another way that you you kind of create this mental formula? >> Yeah, I think you can try and build it up that way or or you can approach it from the macro perspective. And the max the kind of top down is there's it's a just cartoonishly large number. There's a thousand trillion of notional traded in capital markets today, right? Like and if you move that onchain, then you're talking about moving a thousand trillion market peranom on chain. is

just bonkersly large. And that's clearly happening on Ethereum. Like Ethereum is being adopted by Wall Street, but Ethereum itself as an L1 is never going to support price discovery just because it's not built for it. So what we're doing from a rare perspective is we are creating a deck that is effectively enshrined into the Ethereum L1 and in doing so we're creating it's on its own it's unique. is going to be millisecond level fast. So it's going to be as fast as tradfi. So that allows price discovery start happening on chain and it allows us to actually start bringing the whole of Wall Street on.

>> Yeah, it's a beautiful thing. >> And it and it also like just the the functionality of Ethereum allows for price discovery in new assets that were not available before like prediction markets. >> Exactly. Exactly. And and by being based it's synchronously composable with the whole of the Ethereum R1. So you could have a flash loan that you do on a you could do a trade. You could unwind that trade. You could repay the loan, right? Like you can't I mean there's just a type a type of use case that just doesn't exist in traffic. >> Simon, man, appreciate your time and uh looking forward to continuing to see the building ray tokconomics and more. Man, uh I think you got a good thing on your hands. I I I appreciate you joining us today.

>> Nice. Thanks for having me. >> Good to speak to you soon. >> We'll see you next time, Simon. >> Thanks, man. All right, buddy. Peace, man. Rob, best business in crypto pers. It just never fails. I mean, they're just going to keep growing. That website, perpetual pulse.xyz, is just insanely good as well. Uh, this is just a notion board that I was looking at. And I mean, man, I mean, let's see what is Rehea Rya did 72 mil of volume today so far. >> 72 mil today. >> Yeah. Hyperlink did 8.7 bill as like the highest reference.

Um I don't see any OI numbers for Rya today, but it's pretty crazy, man. So, all right, we got Mirat coming up next. Uh founder of Prime. We're going to talk some ME. We're going to talk block building. We're going to talk synchronous composability. Something that Simon also brought up. Um so, yeah, let's talk about it and let's talk about some of the privacy stuff. Let's get Mirat up and uh let's get started. Mirat, good to have you. Welcome to the >> uh the base rollup mega day >> on on the rollup.

>> Good to have you. >> Seems to me. Thanks for having me, guys. It's wonderful to join again. >> Yeah, man. Well, let's get into it, man. Um first question, big one. Should all base rollups use encrypted mempools? Why or why not? Um look I mean uh for trades or privacy related transactions I do think everything should move towards an encrypted mele but then you do have these regular transactions uh where you don't care about or maybe it's some like operational transaction uh and like let's say maybe a contract deployment or something like that sometimes where you don't care about it so you might not need an encrypted mele for those things but similar to how the

internet works I mean somes times I don't care about the data I'm sharing. Maybe it's some posts on some site, right? But that is encrypted, too. So, it's better to have it than not at the end of the day, regardless of your need. >> Interesting. And and so would you say that uh this setup one that Primev uh enables? Maybe you could also give kind of a primer on Primev who for anyone who's unfamiliar. Um let's let's start there and then we'll get into the the types of uh use cases that you can enable with Primev.

>> Yeah, I mean u you know we we stood up the first encrypted mele on Ethereum particularly that allows pre-confirmations, right? So you can abstract Ethereum speed from your own experience and get these uh basically instant economic finality, right? So we can enable instant deposits to exchanges. You don't have to wait three minutes on Coinbase to start trading. If you deposit some ETH, you can send ETH ERC20s to your friend uh very quickly. These are live. Uh and you know, soon we're going to have greater coverage for swaps and trades as well.

>> Awesome. And so would you say that the roll-ups that are transitioning either from an L2 or an L1 or just looking to launch something completely new and they're looking at a based rollup as their solution, they should enable Primev because it gives them this pre-confirmation out of the box rather than having to build it themselves or trying to get it from the sequencers. That that's the zero to one here. >> Exactly. And they get um pretty large network coverage for L1 out of the box. So we have this unique hybrid model between validators and block builders. Uh so we don't particularly rely on just validator adoption. We don't particularly rely on just block builder adoption but we kind of combine them. So we have a little over 1% of Ethereum

validators already adopted this and this is live but u in August we reached a peak peak of 11.3% of mainet blocks that had pre-confirmations over me commit right and this kind of showcases that flexibility between the supply side adoption so base rollup would get basically one out of 10 blocks today um already with with adoption >> wait so you said one to about five and a half% >> uh so we're consistently about 5.5% um of you know in a 24-hour span but we hit 11.3% on August 20th which was kind of a um a shocking moment for all of us.

>> So if if your pre-MP system is already scaling this fast then does this mean that every L2 in the future will need Primev to really consider itself to be based? Um well we don't think of it as a need basis. It is certainly an accelerant and they don't have to think about hey how do I interact with L1 or or any of that out of the box but we see me commit as more of a a channel to get very expressive transactions. So uh your you know your average L2 or your base rollup doesn't have for example me bundle support right it doesn't have pre-confirmations and we just introduced a brand new feature that allows you to set where in the block you want to uh be executed on. And this allows you to kind of avoid a lot of front running

statistically. So they get all of this out of the box and uh you know the folks that are using that on may have commit already on L1 can transact on their uh roll up very easily. >> Okay. And so I'm curious what success here looks like. Like what h how does the landscape of Ethereum start to change as we have we you know we go from 11 to 25 to 50 to 75%. How how does the makeup of the the Ethereum validator kind of the the block building cycle?

How how do things adapt and evolve as we start to scale this up? >> Yeah. Um the main thing is that it completes this uh ongoing trifecta for Ethereum. So what is happening on Ethereum? You're having gas scale and you're having transaction fees come down. So this kind of ripens this environment to have scale on Ethereum. But scale itself without speed isn't too interesting. People want people like scale but they don't want to wait. So uh the speed that you know Mav commit brings kind of completes this trifecta for Ethereum mainet to grow similar to an L2 or even outshine it in many ways right and ultimately you know we're all better off if Ethereum mainet does really well uh and is kind of this main hub where asset security is there scale

is there and you know DeFi activity and stable coin activity is proliferating right so um that's the the real vision that to kind of bring that trifecta in together to make mainet the hub for all of it and then obviously all rollups and every other specialized domain >> gains benefits from that as well. >> Yeah. I mean, yeah. Go ahead, Rob. So, I I just want to kind of round out the the trifecta that you're describing. You know, the the entry queue into the validator set of Ethereum is extremely uh large right now. There's a lot of validators that are looking to enter.

There's also >> No, it's exit I think, right? I think it's both right now which I cool >> and that shows that you know this is a very vibrant ecosystem with a lot of inflows and outflows and so there's demand in order to be a validator on on Ethereum and that kind of exhibits that security point on the trifecta. The the other two elements of scale here are going to be speed and cost. At my understanding, what you're describing with speed is this pre-confirmations. Cost is more dependent on the DA capacity of Ethereum. Is that the right way to think about it? Maybe you could kind of help, you know, round out what the other two points on this trifecta are.

>> Yeah. Yeah. More more or less, you're on point, right? But to to kind of get into the nuance a little bit is that the gas limit of an Ethereum block which you know famously went went from 30 to 45 million in the past year through community signal that's been a huge boon in terms of scaling and that's why you're having kind of L2 level transaction costs on mainet now for a few cents you can get a mainet transaction in and that's going to increase with the upcoming Fusaka upgrade in November programmatically all the way up to 150 million. Right? So now you have capacity to have a lot of transactions per second and that indirectly reduces cost per transaction which is now a right environment. If you bring the speed component to that you

have this trifecta where you can just kind of go ham on mainet. H and in the Fusaka upgrade in November that is going to raise the gas limit from 45 to uh is 60 or >> I think it's programmatically going to increase at first 60 is one of the goals and I believe 90 and then 120 and all the way up to 150. I'm not sure if the timeline for that programmatic uh you know escalation is implemented yet but that's the the idea >> and so people are people are like happy that guay for Ethereum right now has been around one two for the last while even less and you got you know people on

Twitter saying no one's using the chain um obviously in times of massive use there will be still spikes but essentially the goal is to get this thing down or get the gas limit up to a certain point to where we don't see, you know, Guay go into the hundreds ever again like we did in 2020. uh and to be able to make this you know you know the goal of the L1 maybe will never be like a hyperlquid or a or a Salana fast but the goal is to make it such that it can support you know thousands of L2s on top of it and uh you know transactions on the L1 as well for I don't know people say that it's reserved for like wealthier people or people who have certain things that want be done on

there in the future I don't know uh but I'm just curious like that's kind of how I'm thinking about it I how you're kind of thinking about it. Well, I mean, part of that's certainly true, but um you know, you're also going to have a situation where now ADAP uh can come on Ethereum mainet doesn't have to go to some L2 directly and get access to some assets, some DeFi stable coins from there because chances are, you know, there's more assets on mainet for whatever they're looking for. And now that you know through speed through scale that can easily come to this DAP environment and then the DAP can use many tools could to now port that to some L2 that they feel more you know comfortable operating in or they have some other features there like for

DAPs the main thing about all of this trifecta is that look you have speed scale and low cost get access to all of the assets on mainet this is for you DAP build yourself to get all the security stable coins defy access harness it and then take it to whichever EVM chain that you feel comfortable continuing that operation on. And that access is what's most exciting for DAPs actually. You know, security is nice uh and and UX is nice, but the fact that they can access this the biggest hub on on blockchains for all of these assets and DeFi is the main selling point. So, so you're describing this life cycle of a DAP where they start on mainnet as an application smart contract app and then they eventually graduate to an L2 once

they have liquidity and a user base and then eventually they kind of they they scale out from there. Is that the right way to think about it? >> Yeah, but it might happen very much in the background, right? And they might use some tool that does chain abstraction for them, whether that's a wallet as a service tool or something like one balance, right? Basically once the user is on the DAP and they transfer their assets on L1, then the user doesn't have to care about which you know L2 the DAP is kind of porting all the compute to right and that's the point you know now they can have a thousandth of a transaction cost even on mainet's one way or something and then not have to worry about it and when they want to withdraw they can withdraw back to mainet directly.

>> Yeah. Yeah. Yeah. And so basically you get the composability with the L1 applications itself while also still getting the benefits of the of the cheap execution and the speeds of of having the L2. >> I mean it sounds like I mean it sounds like this is like I mean it sounds like having a like a bass rollup with some sort of like alt da and super high you know super juiced um uh some some juiced like uh wrath klein or something like that. uh is like a a it's close to a a really cool endgame for scaling Ethereum.

>> Uh yeah, it's certainly moving in that direction. The best benefit is is all it's all modular, right? So then you can you know compose these components in any sort of way. Exactly. >> Uh but you know with position me commit to be kind of the bridging gap for many of these use cases and particularly for you know me flow to hit your DAP, hit your chain out of the box very quickly and have multi-chain support. >> Yeah. So how do you guys make make money then like how are you guys going to make money or like do you make money? >> So today there's a 2% fee on uh me commit uh you know order flow essentially it occurs in the protocol treasury. We are going to take this back to zero and we're moving to a a different fee model in the future as our

chain decentralizes. Uh you know there will be a a token. The vision there is is not to just have some MEV token, but rather, you know, when you look at the MEV landscape on Ethereum, it's been very individualistic. What does that mean? I use some sort of OFA tool, right? My, you know, I have a $1,000 trade. It goes through some auction and it generates a $100 of MEV and I get 90 bucks back. It feels good, but I just got MEV from my own transaction. I'd rather get MEV from all of Ethereum's transaction. Uh, there's no way to be exposed to all of Ethereum's MEV, right? So, uh, by kind of tokenizing some of these rewards that you're getting from, uh, you know, sending a transaction and pooling all of those funds into a treasury, we can now

give users a token that represents all of the me on Ethereum. So, now by, you know, transacting on Ethereum, you get an upside of all of the MEV on Ethereum, which is literally billions of dollars per year, right? So, um, it it it we're kind of shifting that MEV game. And we're kind of using this term, look, yolo your MEV. You don't have to care about some cash back, but you're going to get tokens and that those tokens will have a claim on the entirety of MEV across the ecosystem. And because I have me commits connected to all of these supply chain and demand side actors, we can pull resources from validators. We can pull resources from users. And we can actually transfer more of that ETH that's currently going back to the user to the validator, increase the security of Ethereum, but align all of the

incentives of all of this MEV participants under one token, and they can get exposure that way. >> Wow. So, if I want if I'm bullish on MEV, I need to be owning Prime. This is this is good. This was a that was a good sales pitch. yeah. I'm bullish. >> Yeah. Yeah. And you know, traditionally, this has been a controversial model, right? Oh, you know, all mev should go to the user or all of it should go somewhere. >> But, you know, if you come to terms with it, users aren't interested in making the 90 bucks on their trade one time.

they they're more interested in getting some upside of all of the me all of this activity even when there's >> so I think that's what this can truly unlock in the success case >> and um just one last thing for you is the is the MEV market in total as you see it growing or shrinking right now >> uh it's definitely growing right I mean you look at onchain uh active addresses on Ethereum it hit an all-time high in August I know there's a lot of FUD on on Twitter But there's 19 million USes active or something.

>> Um, and with the with the gas scaling, what happens is like there are a lot of me opportunities where it's making like a dollar in profit, but because gas is so high, it's not economical for the searcher to submit that transaction. Now, when the gas costs come down, uh, you have not only more transactions generating more opportunities, you now have these kind of micro me transactions that can now go through profitably. And that usually, you know, increases activity on its own because, you know, there's more bots doing stuff and then that creates more opportunities, more arbitrage on L2s, etc. So you're you're looking at kind of this cycle of activity uh you know, brewing.

>> I can imagine how synchronous composability as a result of more rollups becoming based also creates a lot more velocity for the ecosystem. >> For sure. And and we're adding support for these, you know, crosschain me bundles uh on Mavit. So you can say hey look this is the Ethereum part of my transaction this is the optimism part of my transaction and those things will always increase uh activity um you know make prices more liquid uh assets more liquid and prices more equivalent across uh different chains.

>> Very cool. Well Mirat, thanks for being a part of the base rollup day today. Uh it's been a it's been a great conversation and we wouldn't be able to be here without uh MEV commit and just generally this this type of thinking with regards to block building and pre-MP. So uh looking forward to seeing more of the work that you guys do with some of the larger chains especially if they shift towards being based. I think we've seen some rumors. I think Justin Drake was talking about Aztec and Bass and Mantle and some of these thinking about shifting. So, I don't know what your BD pipeline's looking like, but if if I were you, I'd be binging over there. And, uh, >> we're definitely expanding to to other chains. So, appreciate it. Yeah. And and thanks for having me again. It's always a pleasure.

>> Absolutely. >> See you next time. >> See you, man. Cheers. >> Me, man. How do you get exposure to the MEV market? >> I guess you have coin. >> That was That was pretty funny, huh? >> Yeah, that's good stuff. Cool value. Cruel idea because obviously the consensus was like look if you're capitalizing uh MEV and you're putting it anywhere except for returning it to the user you're you know this toxic MEV extractor >> 100%. >> Jared from Subway vibes >> Jared from Subway. All right. I think we got Edward uh the head of BD at Succinct uh who are building into proof the

prover economy. um prover networks, Ethereum level proofs, trust anchors, op succinct and more. We'll get Edward up here and uh yeah, we keep this based rollup live stream marathon going. If you guys are just tuning in, um welcome Edward. Guys, check out the based rollup market map. I'm looking at it right now. It's pinned below. We've got the we got 50 teams building this based economy that that we know and love. Uh we've got succinct up here today with Edward uh which is who are building a lot of ZK proving tools also recently went live with the prover network. So

congratulations on that and the launch of prove and yeah man welcome to the show. >> Thanks for having me guys first time long time. >> Beautiful man. Well, we just spoke with um Miat about some of the MEV block building pre-confirmation uh setup of some of these base rollups and I think it, you know, it ties in well into some of the the work that you guys are doing with OP Succinct uh and thinking about base roll-ups in that capacity and just really just like working with conduit in their G3 sequencer and just trying to just juice these chains. So maybe you could just give us an introduction as to you know what uh succinct is what you guys are building in the base space and then kind of yeah just like walk us into this OP

succinct performancejacking mentality that you guys have over there. >> Yeah happy to give a quick intro. Um so at succinct our mission is to prove the world software. Uh basically we're trying to make zk proves successful to every single developer every single application every single rollup that's actually out there. Um, and we have like a few different product lines that speak towards this. So, uh, our sort of fundamental product is SP1. Um, it's the world's most production ready ZKBM. Um, so for developers when they're writing ZK applications, they don't have to go down to the circuit level and do all this moon math uh, uh, to make cryptographic uh, proofs happen. they can just develop in Rust um and uh uh

create the normal business logic for their program and then just take care of everything in one shot. And then the sort of complimentary piece to this is like the prover network uh which recently launched on mainet. So here we're actually uh decentralizing the actual proof generation to our network of uh provers partners and uh uh thirdparty teams more generally. And all of this is in the service of making proofs more decentralized and driving the cost of proving uh down. And um sort of the way that uh obscync plays into this and the whole like based native having is that you know today the adoption of zk proofs is actually like quite tricky. So you have a lot of folks like uh uh zk sync that um have built

like great products uh uh to sort of mainstream zk rollups in the first place. But for all of these existing uh uh teams and optimism and arbitrum, they're sort of like stranded today. So with our obscync product, we gave uh every OBS stack roll up the ability to become a ZK rollup. And like that's a huge part of this uh based native vision, right? Where like you know the proof system starting to become front and center to uh make sort of better interop possible. Um it's it's ultimately about like enshrining ZK into the entire Ethereum ecosystem.

>> Yeah. And that's that's kind of what Ethereum has positioned itself around now is like this. We saw Justin Drake this whole snarkification of ETH and the entire Ethereum ecosystem is moving away from optimistic roll-ups towards ZK rollups. And so I'm just curious how how do you see Ethereum changing as ZK ZK becomes more uh performant, more affordable, and just generally more ubiquitous in the industry? How do you how do you see Ethereum evolving as a result of ZK? >> Yeah, for sure. So, I think like something that we're super excited about and something that I think the EF is really excited about is that like um sort of ZK allows us to sort of break free of the limits of the EVM. So like uh uh you know Justin has talked a lot

about like increasing the gas limit on ETH1 dramatically and like ZK proofs are a big part of this story because like you know you no longer have to re-execute uh uh all these transactions to make sure that they happen correctly. you can delegate that verification piece um to all these ZK proofs and like verifying uh uh these proofs quickly and concisely is like super easy and uh as you can imagine like for Ethereum this is like a core part of making the rule of centric road map actually work is scaling Ethereum and like the entire family of chains on the stack >> and and so just to clarify how that would work is is if we use ZK proofs uh to execute transactions it costs a lot

less gas, right? And that would allow us to raise the gas limit and therefore create more transactions uh within a certain block. >> Correct. And like that sort of thing is like really critical because as you imagine, you know, Tom Lee is pushing this big narrative to all these institutions on Wall Street. uh uh you know as more demand comes into the Ethereum ecosystem, we need to actually keep up with uh uh the sort of growing uh uh you know ecosystem of applications that are building the growing types of teams that are building on Ethereum and um scaling the L1 through ZK proofs is a huge part of this mission.

>> Uh and you're on mute over there. >> Um Uma has a has a very very big tagline which is like every rollup will be a ZK rollup. I spoke with her like in Denver I think this year about it. H haven't caught up with her too recently. Uh is this something that succinct still firmly believes? If so, how how do you guys foresee this transition happening? Uh I can't imagine it's going to be a peaceful transition, but maybe it will be. Uh maybe talk us through how this happens. >> Yeah, it's a great question. So yes uh every rollup will be a ZK rollup is still very much a tagline for sync and this is something that we've believed uh since day one of the company because you know I think fundamentally this just makes sense as an architecture as we

think about like the terminal state of where Ethereum will be a couple years down the line and I would actually say that like um you know most of the big rollup teams are actually surprisingly uh sort of open to this narrative now especially because Vitalic is out there leading from the front you know is publishing these think pieces about how ZK is really important and I think like everybody's getting the message and uh yeah actually like very recently we just um you know landed this very big partnership uh with the sort of arbitrum ecosystem so we're working with offchain labs to make ZK like a first class citizen in their world stack um and I think like Arbitum very much has been thinking about ZK for many years and I think like

the fact that they're willing to take the leap with us as their ZK design partner to enshrine ZK into uh the overall like uh orbit stack is like a great sign for the overall adoption of this technology and we hope that they are going to be the first of many. >> Yeah. Yeah. You don't have to be the one to say it but it's pretty indicative of the general strategy that eventually arbitum one will probably transition. You know >> optimism was using some ZK stuff for interrupt as well. >> That's correct. Yeah. like you can't see me in the background, but I'm knocking on all the wood right now. Uh uh because yes, you know, ultimately the decision for up one is going to be like a Dow based decision, but we will certainly do

our best to have a great proposal and sort of explain to the community why um the transition for up one will be really important. >> Well, it was a big difference in like the way that the Ethereum leaders kind of started to um talk about some of the ZKVM projects. Like you saw Justin Drake go and be like, "Okay, we're going to use Succinct. We're going to use I think Jolt, Risk Zero, we're going to try to bring these into the L1. Like we're going to, you know, and like Vitalic referencing these." >> Two years ago, they would never reference nonthereum projects. You know what I mean?

>> It was kind of like, so that was a big mental shift, I think, in the way that they were thinking about using some of the technology that these awesome teams are building into Ethereum. >> Yeah. Yeah, I think one thing we jokingly say in house is, you know, Ethereum's definitely uh sort of on the war path now. Um, you know, I think we recognize that now is like a really critical moment for our entire industry and the Ethereum ecosystem. And you know, I've definitely noticed a big sense of urgency from the Ethereum Foundation. Uh increased engagement with like teams in the wider ecosystem. Uh making sure that we all stay really close when it comes to uh standardizing how ZK will be enshrined into Ethereum.

There are all sorts of requirements about like what they want to see in terms of like open sourcing the level of security and so on. So it's very much like a close partnership dialogue with all of us. >> Yeah, that's that's super great. We we uh you know we put out this market map today. It's essentially the based rollup market map and you guys are helping include incorporate ZK into a lot of those rollups. What exactly is the way in which ZK can support based roll-ups? Is there anything specifically uh about based rollups that ZK is able to implement and and upgrade as a result of it being based and not just you know some other optimistic rollup that's transitioning to ZK?

>> Yeah, it's a great question. So, um I think there are potentially a lot of um interesting designs here and um I think it can be fairly heterogeneous. So, um I saw that you guys had uh Simon from Rehea on earlier today and like you know he has a big uh post about like the architecture for the Rehea chain and like you know in his case he has like these prover nodes in the design to make sure that like uh as he and his team are making the transition to you know a based uh like app chain uh that all the activity is being like zk proven correctly to make sure that um the execution like the sequencing is happening as intended. So like that is one example of a design that could work.

But yeah, I think there's a lot of interesting uh potential use cases here. >> Yeah, man. Uh I'm I'm curious about some of the uh proving network economics. Uh I saw recently you guys put a post uh with regards to I think it was uh like a million dollars of of revenue generated or some some some quantity of revenue generated by the proving networks. Um we're very deeply in this in the practical era of crypto now. We're on week 10 of the revenue meta if you've seen those those antics. Um talk to us about the succinct business model about and the proving network business model.

um how does this work in terms of economies of scale if you you know let's say we assume you know thousands and thousands of chains uh or just you know different types of uh applications which require proving you know how do you guys kind of navigate this to create a large economy of scale >> yeah it's a great question um so yeah I would say we're definitely very um commercially minded and like intentional about like how we think about the prover network uh and its economics u because as you can imagine it's like a multi-sighted marketplace where you know on the one hand like we're working with applications including rollups and other products uh to drive proving demand but we also are sending this traffic to our ecosystem of like thirdparty provers who can offer like the cheapest possible

proving cost because they have differentiated uh pricing in terms of you know the GPUs that they can access. Some of these teams are in Asia for instance and um have done a lot of like optimization stuff like that and we also have to make this network work for um all of our partners. So like when we work with conduit and all these other RAS providers um they have to uh also participate in this ecosystem and get paid for the work that they're doing. Um so we very much treat it as like this this this sort of like uh greenhouse that we need to like cultivate. Um so I think a big part of that um is bringing uh uh sort of proving activity from our sort of enterprise prover today into this decentralized prover network. Um

and from there as the economics of the overall network improve we're just going to see u more demand from provers to participate uh more interest from uh RAS providers and other like distribution partners to actually uh sell ZK to uh uh all their customers. Um so it's very much this like virtuous cycle where um all of these players need to get involved for it to be successful. So on the supply side, you're you're saying that right now that there's this enterprisegrade prover uh from succinct and you guys are transitioning this into more of a network of provers building out a community that's all proving all of the order flow, all of the pro proof

flow that you guys are sending to your network. >> Yep, that's right. Yeah, like as you can imagine today, like today many of our enterprise customers have like very strict requirements around like SLAs's and stuff like this. So, um, it's actually like a real problem if one of these like third-party approvers like drops poof, doesn't respond in time because it's impacting like real customers and like real chain operations. Um, so we're just being like very mindful as we do this migration to make sure that like none of these production teams uh have any downtime or experience any disruption. And um, you know, like we're definitely carefully monitoring like which perform uh which of the third party provers are performing the best in terms of their ability to serve these proofs. And um yeah, it's something that we care a lot about.

>> And what's the incentive to decentralize that supply side? Because like my intuition says like look, you guys have the prover, you guys could you know provide all the proofs, right? And then that way you're assured that you know you're meeting all the the customer demand. What what is the incentive to include more provers in the network? >> Yeah, it's a great question. So like um today there are definitely some like hard limits on our ability to like access uh uh compute and GPUs directly. Um, so as you can imagine, like you know, we work with Amazon Web Services as a like as a vendor, they only have so many GPUs that are like available for us to like uh borrow or like reserve. Uh, uh, and as you can imagine, like as these thousands of chains come online,

hopefully uh, uh, the sort of demand for the GPU capacity will quickly outstrip what uh, Amazon has available for just the sync. Um uh uh so like it's really important for us to like bring in a diversity of provers who have access to like different types of hardware. Um so for instance like uh uh you know many of these third party proofing teams you know were formally involved in like Bitcoin mining operations. So they have like a bunch of GPUs sort of lying around and they're sort of looking for new ways to like monetize that uh compute infrastructure that they've built up over the years.

And like this is a really interesting um opportunity like a way for them to get a return on that uh capacity that they have. >> Interesting. And also just for the sake of I mean the the ethos of of decentralization of providing this kind of like global uh distributed set of of uh basically hardware like hardware acceleration uh across the board. >> Yeah. Yeah. For sure. And there's definitely like like a bit of like a like a deep pin style narrative here. is really fascinating. Um but yes like I think the global distribution of the comput capacity is like really important because you know as you can imagine like some um some of these institutions in the future might have like very

particular requirements about like how they're served in terms of proving demand. you know uh so people might want uh uh some level of distributed uh systems serving their proving volume but they also might really care about uh uh you know uh proofs being served from certain jurisdictions like the US or the EU and I think like the more uh uh provers we can bring online the more we can offer this sort of feature as well to institutions. One last one for you Edward. Uh what is the bull and bear case for uh succinct prover network next like couple years like you know let's say we have an amazing growth and a you know kind of like uh not so not so amazing growth. What are your bull and

bear cases? >> Yeah. No it's a great question. Um so I think the uh bull case is definitely every rollup becomes a zk rollup on a a sort of fast time horizon. So we're certainly optimistic that especially with teams like you know offstream labs going allin that this is just yet another proof point that this is the inevitable future uh uh and like you know once a couple of these uh big teams and ecosystems move on I think it'll be a signal to other uh uh teams building the ecosystem that you know hey this is the future the time is now. I think the bare case would be um uh yeah like you know obviously like some rollups are much larger than others. they have a lot more um TVL at risk. Um so for instance

with a team like base for instance they're going to have like many many requirements and I imagine that like the process of them getting comfortable uh with ZK and making sure that there's the appropriate redundancies in place. Maybe they need like you know multiple provers or or or some sort of like hybrid model in the interim. um uh you know like as they figure out like what makes sense for them there's a chance that that uh uh path will will take longer than anticipated. So I think that would be the bare case. >> Edward, man, I appreciate your time. Looking forward to seeing how some of these ZK systems are applicable into the the this basenative future that Ethereum uh seems to be going down. I think a big

a big like the big why here is is trying to evade the typical blockchain trillemma of trade-offs and it does seem like some combination of using Ethereum for sequencing using super performant DA using ZK um you know having that composability with the L1 all in one kind of bundled together uh we get to a really nice uh you know quote unquote endgame here. So um yeah man I appreciate I appreciate you sharing some insights. Yeah, thanks for having me, guys. And yeah, ZK is the endgame, baby. Let's make it happen.

>> There we go. All right, Edward, enjoy your day, man. Cheers. >> Bye. >> Peace. All righty, guys. ZK, ZK, ZK, we got another ZK conversation coming up. This is We're just firing, ripping through here, guys. If you haven't seen the base roll up market map, it's right there. It's pinned. It's in the comments. Rob, how you feeling, man? >> We're halfway through. Um, I got a flashback to when we did our stip marathon. Shout out to the arbitrum. >> Shout out to the arbitum community. That was I think one of our first uh >> first marathon streams. And honestly, Twitter, those marathon Twitter spaces were the predecessor to our live streams. Man, I was in Brazil in north

Brazil in the middle of a of a tiny little no paved roads area on that stream on my Wi-Fi on the on the >> and look at you now in the Hawaii penty. Come a long way, Andy. >> Bull market, baby. Bull market. >> Let's get Jacob. >> We got Jacob up here. Let's get him up. We're gonna talk Boundless. We just had Edward from Succinct on. Now we've got Jacob from Boundless. The best friends here. Um, I guess we have a little interesting headline here. I don't know if I did that on purpose, but uh, here we are. Jacob, good to see you, man.

>> What's up, guys? Very, very classic of me to to join a call on Annie's talking about how he's in the middle of nowhere in Brazil. >> Yeah, I mean, that was our last arbitrum stip marathon. That was the beginning of the uh, of the long form multiple guest Twitter spaces now streams. But Jacob, pretty pivotable pivotal time for Boundless right now. Um, catch us up uh for those who are new to Boundless, for those who are familiar but just want a quick update as to where you guys are at. Uh, catch us up and then we'll dive into some of the base rollups. Uh, ZK combination.

>> Yeah. So, yeah, quick introduction. I'm Jacob. I'm product lead at Boundless. Boundless was incubated by RZero to really just be this really easy to deploy on CK infrastructure stack. Um you know we had invented the general purpose ISA CKVM write a high level language. Most people use Rust um and you can develop CK applications instead of having you know a PhD in cryptography. Problem is is you know it's easy to develop but to deploy is still quite difficult. Um, and that's where we wanted to do with boundless really get it down to, you know, sort of think of like 30-day turnaround where, you know, you can commit two engineers and deploy something in production. Um, regardless of where you are. Few weeks ago, you know, we launched mainet beta

around uh the signal. It's been amazing. You know, we've we've scaled the market to the largest throughput of any prover network, over 70 trillion cycles yesterday. Um, there's over 3,000 provers online. Most of them I don't even know. Um I was just looking at the we just kicked off season two of prover incentives last week and out of the top 25 provers in season two only two of them are from season one. So we're really seeing I I guess sort of related to early Bitcoin mining days a lot of MEV games being played. Um it's really insane to see the competition that's going on.

Um and yeah, we're just, you know, starting to prove more chains and and clearly, you know, we did a community sale last week. Had an insane turnout, over 71 million pledge. >> Wow. >> Um for the token um across 21,000 people. >> Wow. >> Um um and then yeah, mainets up. >> You guys were trying to raise 4 million. Yeah, we initially had set it to four million um at I would I mean I would say very favorable terms, right? We wanted to focus on getting the community we really wanted to reward those that have you know been aligned with us for multiple months at each other. Cool thing is you know we ran this like signal campaign um a few months ago 17k of them um participated in the token

sale and got their like max allocation. So we ended up giving yeah super wide distribution um and then ended up we we wanted to keep it at four but we felt that like you know these people deserve to get in um they deserve that opportunity to buy in so we had to expand it to 14 just to get to a number >> so you did end up increasing it to 14 million. >> Yeah if we kept it at four like no one was going to get anything. Um, like it was super great to see the hype and the interest, but I like, you know, I didn't want someone that, you know, had participated for three, four months and really contributed to our success to walk away with, you know, $100. We

wanted we wanted it to be fair and we think we got to achieve that. So, >> so would you say you guys are pretty much all systems go? What's left on the checklist? >> Yeah, I mean, we we need to launch our novel incentive program. Um, you know, at this point in mainet beta, we actually suggest that partners can start to use the system. We're I mean, pretty decentralized at this point, like over 3,000 provers. Um, you know, some random prover just did like 7 trillion cycles yesterday. I have I have no idea. I have no idea who this person is.

>> Um, I actually, you know, I was just checking and again, right, like we've had almost 95% turnover rate on on provers, not because provers shut down, because they're getting out competed by other random people. Um and we just need to launch the the novel incentive program and prove verifiable work um which comes with the token and then yeah that we'll consider. >> Beautiful. >> And so curious as to maybe you could just explain this like this churn that you're talking about. You're describing it as something that's very bullish, right? And so why is this t this turnover from these provers so so important?

Yeah, we are hyper capitalist here at at boundless and open markets always win. Um, proving is a commodity. Um, if you are distributing proofs to the, you know, not the most competitive prover, right? Like let's say like another prover can do 10 cents and I'm giving it to someone that's going to do 50 cents just to keep them online. Um you know this is called a planned economy you know the Soviet Union tried it certain uh dynasties in China tried it it doesn't work for commodities um has never worked it always end up just adding efficiencies and doesn't actually achieve any decentralization

um it always ends up the market games it >> so why is it so bullish that we're seeing so turnover it's because these new people are just doing it for cheaper um they're doing it faster for cheaper and you're really just seeing this open market. You know, you can throw it back to the early MEV days where you had people doing simple arbitrage of like Bitcoin is 10K on one exchange, on another, you know, exchange it's 9500. >> We're now seeing that with proving infrastructure, with compute providers. Um, and it's all just for the benefit of the consumer, right? Like you're just getting your proofs cheaper and faster. And so do you do you anticipate the consolidation of the market around a few key provers since they have access to cheap compute, they have access to GPUs, they can serve

these proofs at the lowest price. >> Yeah, you know, I expect that consolidation one day. You know, typically in every commodity market, you're going to see it end up being four or five parties. You see that with Bitcoin mining, you see that with >> any United States futures commodity market really as well. Um, and that's the reality. It's not going to happen for a bit. Um, so this is one of my favorite stories to tell. You know, we finished up season one of prover incentives. First place last season was an 18-year-old from Germany, three weeks removed from high graduating high school. And >> that guy's about to have the airrop of his life.

>> Oh my god. >> Yeah. Um, >> welcome to crypto, buddy. >> And like this guy, you know, he hustled. He I he told me that like you know he had done his friend a favor to get access to some spare machines he had in a cloud provider. Um like really just scrappy story. Um and you know there was significant like really sophisticated parties right like you know the top Bitcoin poll person um who does the most Bitcoin hashes every day uh was participating and all the large validators were participating and it really just shows how inefficient and why you have to do an open market because there are these people that will come in and just like cook man and you

know these people are dropping the auction time down to like 150 milliseconds at times something I didn't think was possible Um, it's just really cool to see and you know, we've got a Discord going for these people and it's really cool to see the collaboration as well, right? These people are winning and sharing their strategies as well and we're just going to succeed more and more with this type of behavior. >> What's the dimension for a strategy to out compete another? like how does an 18-year-old from Germany who's able to get access to some, you know, compute in the cloud, how are they able to compete with the largest Bitcoin miner in the world, what what's the dimension that they innovate on? Yeah. So, there's like a few things. Um, you know, obvious

one's going to be like electricity cost, how much you're getting the machine, you know, 4090s are so good on our system, and you can really find like a glut of them at a really cheap price. I' I've seen some prices on some cloud providers for as low as 20 cents. Um, which is really insane. The second is bidding strategies. So with our proving node, you have the proving cluster, right, which is this open or this is public sort of codebase where you can spin up a set of 100 GPUs with ease, but you also have a broker part of that proving node where you're setting your strategy, setting your price. Um, a bunch of people have modified it at this point in like, you know, we're currently running most of the orders on base mainet and there's flash blocks and they've like colllocated their node to Bas's AWS

instance and are sniping like orders via like the next flash box flash block. Um, I saw one order get locked in 50 milliseconds. Um, so there's a lot of stuff of like locking. Um there's still sort of more supply than demand on the market and we're constantly ramping up. You know, I said we hit 70 trillion cycles the other day. Um so a lot of those timing games are important right now. >> So Jacob, this is the based rollup Ethereum's base native rollup stream today. It's a marathon and we dropped the market map. Obviously you guys fall within the ZK proving category which is quite broad. Um, but talk to us about your vision for incorporating Boundless

into some of these base rollup designs. Where do you see specific improvements to be made and and perhaps we could even start, you know, talking about something like what you guys have done with OP Kyua and the one hour ZK finality which kind of, you know, renders optimistic optimistic roll-ups obsolete. kind of how are you thinking about you know risk zero boundless as this kind of neutral proving layer for connecting some pre-MPS ethereum L1 rollups together. >> Yeah. One one unique aspect of of boundness really is that we come to you.

Um right we want to be this like universal proving infrastructure which means you got to go to your customer right we're not asking you to bridge to an L2 or use our token for payment. We really try to just colllocate where you exist. And for these based rollups, it's going to be Ethereum out one. Um, you know, one really cool thing we can do is sort of, okay, you have your settlement contracts. We actually just deploy one more contract. Um, you deposit some ETH in it and now you've got proving in infrastructure. We haven't talked about it much. Um, internally we refer to it currently as like automatic prover markets, but essentially we can automate all of your infrastructure. And on top of this, you know, these base rollups don't only just get the best price. um currently we're the most price efficient

out there or you know a really strong guarantee that your proof is generated. We can actually start to guarantee that your proofs get delivered to your application to where you're having to just run less infrastructure. Our operational overhead for integrating with balances is quite low because we can pay provers uh on delivery of the proof not just generation of the proof. So you are just gonna as a base rollup okay you're on Ethl1 you're using it for sequencing okay strip the provers of any right of sequencing because you want to capture that value yourself and then um ask for the proof and you're hands off right like it's just going to show up to your application just as you use AWS today right you're going to show up to AWS you're going to choose an instance your website is going to go

same with boundless today you're going to write your program you're going to choose your instance on on boundless and your application just going to go um as simply as depositing some ETH that you're already using to pay for fees. >> Okay. So, it's so uh from a more technical perspective, how how do you see base rollups changing what you guys or like or like maybe the better question is like okay you you balance can provide X Y and Z for traditional sequencer single sequencer roll-ups. What can Balance provide for bass roll-ups? Yeah, I think it's the complete like just set of services honestly probably is a little like simpler with base rollups just given how tight they are. Um, you know, we're already doing the proving

for Tao which is, you know, I believe is is the first based rollup, >> but really just giving them this full stack proving infrastructure where you're just not worrying about it. It's fully decentralized from the get-go. It's, you know, open. There's no central party that can stop your proof from showing up. um we're the only, you know, offering like that on the market right now. Um so, you know, you're probably becoming a bestseller because you want like, you know, more decentralization um and a tighter integration with Ethereum L1 and and Boundless provides first class support for that uh trade-off you're already willing to do.

>> All right. Well, we've got the Balance community in here. I I can tell we've got some people quote tweeting, retweeting, commenting. They want to know about ZKC. Ticker ZKC. You've been tweeting tickers, EKC. I've never seen you tweet a ticker in my life. Been following you for like three years. Something's changed. I told Rob, I was like, Rob, I'm gonna tweet tickers of majors going on for the rest of this bull market. I know it's not the vibe, but I'm telling you, this is how uh crypto Twitter works in the bull in the late stages of bull. You you just tweet tickers. Um, I'm saying I'm doing something different than what you're doing, but we're, you know, we're doing the same thing when it comes to ZKC. You know, you've been hinting at it. Maybe not about the

timing or the mainet or all of that. I think we can, you know, assume sometime in the coming weeks to months. But when you're thinking about a token to per to be the basis to be the bet on Ethereum's proving economy, let's say, you know, what are we thinking about as the the business model, the sustainable uh, you know, revenue model for a proving network like Boundless? Um, how do you see this kind of playing out for ZKC? basically tell me tell us tell the community why ZKC is not just another you know valueless governance token.

>> Yeah. Um wow there's a lot to touch on. Um first anything I say is my personal opinion. I I'm really I'm really proud that we're going to launch with governance day one on Boundless. Um when I say it's fully decentralized I mean the bus factor day one is not us. uh the core team at Boundless Network, which is the new, you know, development company for Boundless Foundation and the Boundless Network. Um if if we get hit by a bus day one, it will still it will still work day two, right? You know, development might slow. We're doing a lot of that right now, and we're happy to get open contribution, but you know, I had a really proud moment about a week and a half ago. Our AWS infrastructure

went down for six hours. We had 0% downtime on request. We had 0% impact on the customers that are live on boundless today. Um, which is just sick. We have removed ourselves from the critical path. Of course, we still own some contracts. Um, and we're going to relinquish that control with governance at the beginning. So, really, really cool about that. Why does why does ZKC, you know, matter for the proving economy for Ethereum and really beyond? um one as um proving demand goes up those people generating the proofs are going to want to have the token um to capture the you know novel incentive mechanism we have additionally ZKC is used to secure the delivery of proofs uh pretty

proud to say that you know we're the only sort of prover network right now that has economic security when delivering proofs our slashing is live today you can go on our explorer and and see it um in action I think you over like 10k USD has been slashed for the past few weeks. Going live domainet that will be um ZKC instead of USDC. We sort of need independent asset um for decentralization reasons. Um and then lastly is you know we can not only incentivize proving of blockchain applications. We can actually go further and start incentivizing you know proofs of web 2 applications.

Anyone that generates a proof for riser as long as they hold or sorry, oops. Um, anyone that holds CKC uh and stakes it on the balance network is eligible for the incentive. So even if I'm using my browser and I generate a proof um if I stake some CKC, I can start to capture some of that incentive. So it's really blockchain and beyond with CKC. >> You guys just put out a graphic uh on the Balmas account just now. Let me pull it up. Uh just to kind of further uh confirm to the community and to ourselves exactly how this works. So protocol staking with ZKC is permissionless participation which meets economic alignment. If you're running a

prover, you stake the ZKC to signal your proving capacity to the balance network. So you know I have five 5090s back here in Hawaii because I'm running local LLMs because I don't trust Sam Alman. I go I stick ZKC. I signal my amount of hardware. Uh and basically as proof demand grows, provers can stake more and more ZKC and the entire boundless ecosystem gets stronger. Uh what is the like you know for example when you in like a in like a data availability uh layer you stake the token to basically fight data withholding attacks. When you stake ZKC what are you what are you fighting against? like what are you trying to prevent or have a fall back or

a slashing for or what is the malicious behavior or it's often times not even malicious it's just somebody up. Uh what are you trying to prevent? >> Yeah. So there's three things here. Um I'll start with the most boring and then go to the most exciting. First of all is governance. Um we're not going to say that governance is a use case without actually launching it and we're launching it day one. um you know people token holders will be able to vote on proposals day one um which I think is pretty sick and you do have to protect against that um you know a lot of people don't because it's not actually governments but we will have it u we want to get out of the way so there's that second is uh you know the slashable amount within

a proof you know if I'm you know rollup with 100 mil TVL like I want to guarantee that my proof is going to show up there's like how many games to be played it's not nice um so I'm gonna require you know someone to put a slashable amount down, right? So, let's say the proof is worth $10, you know, we we currently suggest that people will make that slashable amount $100. Um, you can imagine with some of these larger TVL roll-ups that are definitely considering becoming, you know, ZK roll-ups, you know, imagine like a arbitum one or a base, you know, I might tell them to put it at 5K, right? And, you know, if the prover doesn't show up, that's a substantial amount of money um that's going to get slashed and burned.

And then the third thing is, you know, with two-sided markets, you need to smooth the supply and the demand, right? With supply, if there's not enough demand, they're going to turn off. So, we want to keep an incentive to make sure a certain number of machines actually stay online as demand is going to be volatile for any market at the beginning. And on the flip side, if we incentivize that that supply is online, you're also going to um get demand to show up. demand is not going to just come if there's no one to do the work. A great example of this uh that we use all the time is Uber. So, if you showed up and you wanted to use Uber, I don't know, launched like seven years ago or

something and there was no writers, you're probably never using the app again, okay? Um I know that I get wary of using Uber if like it just takes 10 minutes for the person to arrive. Um >> so that would be a big problem. New York. >> Yeah. Yeah. We want to make sure that like supply is there and ready for the demand. Um so really that cold start problem that people always um talk about a token doing. >> And so if you were to put kind of like more emphasis on one side of the marketplace or the other, would you say that it's the supply side or the demand side that you know could use some more attention?

>> Yeah, you know, we've spent a lot of time bootstrapping supply. Um you know, it's it's hard to tell. you can ask people today, but I think we've got a, you know, over 5,000 GPUs online cooking. Um, yeah, it's just insane growth there. And now I'm really focused on the demand side. Um, after mainet, I think we've got a really good, you know, go to market strategy right now. There's a, you know, we've been saying that you should prove your chain for like a year now, right? And how many people are proving their chain? Not many. I think we've, you know, really developed a good list of like why people actually want to prove their chain and the dollars make sense. You know, if proving costs 10K, but I can save you 20K >> um, you know, per month, which proving

is cheaper than that, by the way. Let's say proving is 1K a month and, um, I can save you 20K and bridging and integration and all this sort of thing, you're going to approve. Uh, and I think we've reached that tipping point. And this isn't just for L2s. I think a common misconception is people think that L2s are the TAM. That's just not true. There are reasons to prove L1's as well. And we're starting to see that adoption. We kicked it off with Ethereum. >> Yeah. The signal >> with the full consensus proofs, which are sick. You know, they're running in production right now. People are using them. Um, but we're going to start doing more Lance. People saw that and really got interested and yeah, I'm pretty stoked. Um, you know, the internal memo right now is we're just going to prove every chain. It's going to happen. Join

us or get out of the way. Um uh it could happen you know as soon as 18 24 months every chain >> road to mainet. Jacob, thank you for joining us on the space rollup stream. I know it's going to be a long couple of weeks into Q3 or into the end of the year but really just into the next couple of months. So heads down and uh looking forward to uh seeing boundless mainet and uh getting more and more ZK out there in the world. So thanks for joining us, man. >> Yeah, you know what ticker to tweet, Andy.

Yeah, there you go. All right, buddy. See you soon. >> Bye, guys. >> Byebye. >> See you, Jacob. >> All righty. >> ZK wisdom. >> Yeah, man. >> Shared with us today. >> That was a nice little uh ZK double segment there. Uh >> I think we're going to switch it up a bit up. We got Mara and Shirum, which >> more than base ropes. We're going to take a bit of a break from the technicalbased roster. We're going to talk about Ethereum staking, DATs, ETFs, where this yield's coming from, who's staking, why they're staking, what's going on. So, Mara is a one of the prominent uh figures at Aluvial. Aluvial is a pretty institutional-grade staking company for Ethereum. Shri Ram is obviously the CEO of IEN Labs, ien

layer restaking. um who who is getting quite quite a bit involved in the state of uh you know in institutional appeal for Ethereum. So I think that's a general direction for this conversation and um yeah guys I think we're ready to to to have them up. I think we've got them both in the back and yeah a little break from the base rollups uh conversation into some more of the Ethereum staking institutional demand ETFs conversation here. So, we'll get Mara and Shram up and uh keep this rolling, >> guys. Welcome to the show.

>> Hey, hey, to be here. Thanks, Andy. >> Yeah, guys, good to have you. Mara, I think it's your first time on or at least it's been quite some time. Would love to have an introduction for yourself and Aluvial. I think our audience knows Shirram quite well. Um, and then we'll jump in. >> That sounds great. Well, thanks for having me, guys. Uh, and I think yes, it is the first time. Um but excited to be on. Uh my name is Mara. I'm the CEO and co-founder over at Aluvial. Actually been working now in crypto for better part of eight years. Mostly focused on staking. Um it's part of Aluvial. We are the development company behind Liquid Collective. Um enterprisegrade staking standard supporting institutions and individuals alike um to support liquid

flexible and um scalable solutions in the staking market on both Ethereum and Salana. So excited to be here. Beautiful. And Siru Rahm, welcome back. Um, I think our, like Andy said, our audience knows you uh very well. You've been on the show several times, obviously involved in Ethereum staking as well. And so there's a partnership here between Agen Layer and Aluvial. Maybe you could explain uh what the relationship is between the two of you. >> Yeah. Um, excited to be here. uh you know the uh the macro as you know all of us know is that institutions are you know interested in you know in the Ethereum ecosystem quite heavily you

know the whole digital asset treasuries that are being spun up uh to let people uh get exposure to ETH I think is a big meta and as you think about institutions that are holding ETH they're obviously differentiated from holding Bitcoin in holding a productive asset. And so if you look at every that the first three words they use staking, restaking, defy, every Ethereum that right and it's because that's the real differentiator between an Ethereum and an Ethereum treasury company and a Bitcoin treasury company because the set of things you could do trustlessly with BTC is very limited. So the base level of what you

can do with ETH is to stake in the Ethereum protocol and receive rewards. And so obviously the biggest question that you know the all of these digital asset treasuries are thinking about is how do I deploy ETH in a secure compliant you know trustworthy manner and I remember talking to Mara I don't know three years back now with this vision of hey we want to have institutional grade liquid staking right so where you know we you can trust the validators they are in you know compliant and regulated all this kind of stuff. And so obviously using LSTs gives them two things right

one is it gives them the base level of liquidity and then it gives them uh yield that comes from staking and so combining these two I think that is the first pillar of a ethereum rat is like you know staking uh to receive the zen and if it's liquid you can use layer in restaking using the e to actually do more, right? And so the core idea, you know, you know, the audience may know restaking a bit here, but just to state it, you know, normally what you're doing is you're taking ETH and then staking and then promising you're running the Ethereum protocol correctly. With Igen layer, you can stake ETH and promise you're running Ethereum protocol and

some other services correctly. So you're receiving those additional baskets from these other things. And that's what I think this partnership is a very natural complement of what we're building. Zenolet itself is not a liquid staking protocol. So we rely on partners to actually do that. And in the context of the institutions, you know, we want to go with the gold standard institutional liquid staking protocol. So that's the kind of like the history of this partnership. >> Yeah. And Mara, when you're speaking with these institutional folks on the liquid staking side and on the staking side, what type of appetite are you seeing for the, you know, the variety of opportunity, whether it be staking

directly into the protocol, as Shir alluded to, liquid staking, maybe depositing on something like an A, or even going restaking, you know, where do you see the appetite for different kind of demographics and how are you how has your experience been just, you know, navigating the these waters as the institutional uh demand has increased quite a bit. >> Absolutely. I mean I think it probably worth just just you know talking about the overarching trend that we're observing which is institutions are moving beyond passive bitcoin holdings period. I think that trend is you know largely weaving its way through the industry across a number of different segments. us as a a more institutional focused product have obviously been

incredibly excited to kind of see this market cycle develop and also hear what you know customers are starting to tap into. So we can talk a little bit about digital asset treasuries. There's many other segments that we're starting to see adopting this technology in a more mainstream fashion whether it's ETFs that are now gearing up for uh staking approvals in the US or it's you know retail platforms and fintex that are starting to look for optimizations and new product opportunities and services uh for their retail products. Um but on the DAT side, I mean one of the the things that I find quite interesting when we talk with with a lot of these public companies um is is how far and how open they are across the spectrum of solutions that are available to them.

And for me it's quite exciting just because we've you know in the institutional space and particularly when we're talking about public registered regulated entities. I think this might be the first segment that is you know deeply thinking about tapping into the various different opportunities that the onchain markets make available to them. I think we you know generally see uh you know traditional staking is is is going to be table stakes. I think that's baseline yield generation is going to be table stakes. I think any treasur whether we're talking about digital asset treasuries or just corporate treasuries and treasuries in general um that baseline yield is going to be um massively important. I think most of the conversations that we're having with a lot of these digital asset treasuries now is about how how we layer

into additive strategies um that increase ETH per share or sold per share depending on the products that and and strategies that people are using um to actually maximize performance um relative to the baseline yield that they can generate you know on ETH that 3% that's currently available to them and so I think as as Rom said really does follow a little bit of this pattern where it's how do I stake okay great uh How do I move from just normal staking to actually having the option to do other things? That's where liquid staking becomes massively valuable because it's programmable and you can start using it in DeFi. And our product is actually QC integrated and so people can neatly use this product, you know, within the parameters of what's available to them. Um, restaking is probably the next frontier where we're

starting to see a lot of appetite as people are thinking about how do I make my ETH more productive and also how can I continue to create security value for the ecosystem more broadly. Um, but I'm quite excited to hear about people moving into DeFi too. I think we're having probably at least two three conversations about this a day. Um, I think you're starting to see a little bit of a differentiation in terms of people that might be very conservative whose road into DeFi participation might take a little bit longer and others that are already very actively starting to layer into these strategies when you start seeing participation, default lending protocols or liquid restaking solutions. Um, and so I think we're going to continue looking to support sort of that broad spectrum as people start layering into these different strategies.

Yeah, to your point, Mara, there there's several variants of yield onchain. Uh even getting more exotic beyond just the liquid staking, go into DeFi, go into reststaking. All of these are towards the goal of increasing Ethereum per share. And that's how these digital asset treasury companies are going to survive. And so I'm curious about the matchmaking process. like when you're talking to a a registered entity, what is the process of kind of evaluating their risk tolerance? And then do do you go to someone like Siri Rom and kind of get his opinion on what sort of uh AVS's might make sense for this entity to stake into and become an operator?

Generally, how are you finding the match uh creating those matches between this entity that wants to stake and this yield source onchain? I think I mean we're not a formal advisor just to flag that right in uh in the process but um I think it probably starts a little bit more basic than that conversation it usually starts with I need to stake my assets okay what custodians can I use what non node operator should you should I use on the back end I think at that point the security question starts becoming relevant okay multi-operator diversification to ensure that you're mitigating correlated failure risks okay I also want to create additional yield on top of my staking or at least have

the option of being able to generate it later without having to unbond my ETH and wait for 3 weeks to get it back and not earn rewards which is a huge drag on performance for people. So that's usually when we get into the conversation of okay through your qualified custodian you can have multi-operate diversity using a product like LSE at Anchorage at Coinbase at Bitcover you might want to be using it. Um I think the second part of the process is we're seeing most teams either staff or already have internal uh folks on their side that are really spending time digging into the DeFi landscape. I think people will probably start with bluechip. I think, you know, no surprises there in terms of what we're most likely to see people really starting with. Um, and I think one of the nice things, and I think, frankly,

why we've partnered with uh with the Ian layer team on this report is really the education of bringing people along in that journey. What does it mean to use your ETH? Why is it a benefit to participate in restaking? What else can you do in the DeFi landscape? And what is sort of that gradual on-ramp that we can, you know, support people with as they make decisions about what risk adjusted tolerance and and and appetite they have in participating in the market? So you can't suggest exactly what to do but can kind of show the options and uh kind of show the risk parameters. Um Sher, I'm curious what is the what is IGEN layer's institutional appeal? What is the what is the what is the next like you know 6 months 12 months for you guys

look like for um IEN layers institutional uh push like what what is it that you guys see you guys can provide? How do you how do you think about like operating in this im in the sphere whether it's with aluvial or just kind of naturally within the ien cloud ecosystem what is the you know what is the ien layer pitch in institutions why does that matter >> yeah uh you you can think of uh the the like I said the main three things they're thinking about taking risk takingaking defi and when you think about like how an institution evaluates these opportunities primarily risk robot right so what risk am I taking and what reward am I getting? And the core thing that we built on layer for is opting in

and securing more networks and services. And so if you think of what is the additional risk that you're taking, you're taking operator risk like that the operator does not run these additional tools and services correctly. So we think basically reststaking is the lowest form of additional risk that you can actually take because it's just additional operator risk on you know saying hey you know the operator is up running Ethereum they can run five other 10 other networks and earn additional rewards related to that. So in this like riskreward kind of parat we're closer to Ethereum staking than we are to a or other you know financial instruments

where basically what you're doing is underwriting financial or price risk right so you're promising that E2SD is going to stay solvent at a certain ratio whatever right so that that's how we think about it so we think over time because the additional risk related to each staking is very minimal we feel like a lot of uh institutions will naturally use you know and and take advantage of that. So that's the first first point. Second one I can layer did not build you know like our own liquid staking liquid restaking protocol and this is because we want to give institutions the expressivity to choose their own operator set. So this was an important consideration and it's kind of

you know great to see this come to reality right because it took us 10x more time to build native restaking than it is to just well uh u you know deposit an LSD. So there is definitely like you know people who want a lot of control they can use like you know the um pods and the native restaking to actually opt in. That's the second one. Third one is on the DI side. You know, even though our original construction was to support this ecosystem of ABSS, which pretty much all the ABSS today follow this operator and infrastructure uh execution model as we introduced in layer slashing and redistribution which is the slash funds

not just burnt the slash funds can be redistributed to the ABS. sort of what we're seeing is emerging from the market is people are building things like borrow against your staked ETH positions. You can start doing DeFi more natively on top of layer. So you have like a stake deep position in layer. You can build an ABS which is which basically says if some conditions are not true I can slash and redistribute the funds back. People are building new kinds of stable coins, new uh you know insurance protocols. Um we got we had cap labs go live with their kind of new stable coin product. But in general there's a bunch of new things.

There is you know opul which has built medical reinsurance on top. There is a bunch of these new protocols which are just coming up. It was not the original design for layer to opt into this more complex pricing risk. But you know these institutions can choose these graded risks across this portfolio. So we absolutely see this like you know as institutions come in they want to use something today and then like get deeper into the ecosystem they serve as on-ramps and you know maybe they initially just opt into layer and da like one as then they're like okay you know this is interesting let's go get additional rewards from doing all these other services and then like they you know may allocate a portion of their

portfolio to more financial actions but the cool thing is you know with this kind of a partnership we can do all of these kind of inside the ecosystem. So that that is something that we're excited. >> So guys, I have a more uh a more broad question for you both and I I appreciate that. I know you're quite close with Joe Luben and I imagine that you guys have had quite a few conversations with regards to Sharp Link and potential ways to uh kind of support them. Um recently I think their their their uh premium has eroded quite a bit. So it's just a very interesting financial engineering game happening with regards to how to kind of take the next step to to earn more ETH per share. But something that that's a

bit more uh systemic that that I'm curious about both your opinions on is that um you know for example um Shirum Ian layer used to have one of the largest amount of ETH in a smart contract of of anyone right it was like Ethereum Foundation a couple others and then it was I layer now it's like we've got like Sharplink Ethilla you know Tom Lee's calling for $64,000 per ETH he's trying to buy 7% of the supply stuff's getting wild out there I'm curious like from a systemic protocol perspective as you guys are both deep in the way that the Ethereum protocol design works. Is there a systemic risk to some of these institutions owning too much of the Ethereum supply or perhaps better asked how should we be thinking about

institutional footholds in the Ethereum network? Because there are pros, they have longerterm vision. They don't have weak hands, but there are cons. Perhaps they aren't as aligned with the core values of decentralization or perhaps they have other agendas and mandates. Um maybe you kick us off Mara. How do you think about this? Maybe we can get some debate going. >> Yeah. Uh it's it's a great question. I think first principles in terms of just how I've looked at this industry is it needs to be adopted holistically and broadly and embedded into financial services across the world. If we accomplish that, we've done a good job really, you know, leading the charge on on making onchain markets, you know, truly be able to harness their their potential. And that inadvertently means

making sure that solutions are mainstream and and accessible to the mainstream markets. And in many ways, you know, we have conduits, incumbents today, we call them institutions or financial players that serve a lot of that market in in many different capacities, making it more accessible for people to actually be able to interact with digital assets that may not be in a position to hold them directly on their balance sheets. And we're seeing a lot of that innovation be unlocked in the cycle in for many reasons frankly because the regulatory floodgates have opened and we see you know particularly in the US but also a broad a much more positive and open stance and you know conducive guidance related to digital assets whether it's on the stable coin or staking side right um and and I think that's critically

important like to me when I think about what does the next year or two look like I want to see you know broad and holistic digital asset services and onchain services being integrated into the Robin Hoods and the Fidelities and you know the Black Rocks of the world and we're not too far away from that, right? And that's the reality. So I I do think from my perspective these are all really positive developments. I'm frankly happy to see that we're entering an institutional market cycle that is actually creating in many ways sort of the the the ability for for us to really you know broadly serve this technology to the market. Um and in many ways you know whe argue whether or not eventually DATs when they do accumulate a sufficient amount of assets that could introduce systemic risk right now I think it's actually you know we leave

micro strategy aside less than 1% of the entire market cap of crypto that's currently held in debt so I think largely still theoretical as a risk but practically speaking there are things that are happening um that I think is making you know this current market you know participation incredibly valuable including the fact that in many ways having public companies accumulating digital assets is opening the ability for other entities to start acquiring shares and indirect exposure to digital assets. I think you guys had a guest recently that was talking about, you know, what it means for Micro Strategy to end up in the S&P 500 and eventually having this, you know, in in people's 401ks. And so I think we're not too we're not too far away from that world. And I think that's incredibly,

you know, exciting in many ways. So I do you know always with caution when it comes to systemic risk and rapid accumulation that is currently creating you know certain price dynamics that are positive and can inversely also be negative if things trade below below MNAV but I think overall we're seeing really positive momentum not just you know in broad adoption but also the regulatory and accounting side where a lot of things are getting worked through at the moment at a much accelerated pace because you have important players demanding you know the ability to to holistically integrate these assets uh into their strategies and into their treasuries.

>> Sham, anything to add there? It it is no longer uh DeFi, yield farming, food farm accountability, it is it is quite a bit deeper. Uh >> I I think when you think about like the risks, there are two two categories of risks. Firstly, I completely agree with Mara that this this is >> this is the reason we do this >> is for everybody to come and use it and you know the the um if you go like one level deeper on like what the system at risk could be right and the price price you know price action is one one dynamics that that whether you know one one institution accumulating the price like what what dynamics does it lead to I think that I'm less worried about you know price is

what the market kind of like ends up with. So I think it's sometimes uh people who leverage up based on price dynamics, I think they're the ones and it's that's what the market is. So I just accept that. But if you look at like the Ethereum consensus protocol and the and the whole like uh things that you know the EF used to be concerned about which is hey you know is is there a centralization risk factor? Is is there control? I think Ethereum by obsessing about these things quite early when there was really no such risk actually has built a very anti-fragile system and I think this is really Ethereum's kind of core value proposition building six you know five six different execution clients five six

different consensus clients building distributed validator technology even if it's a single kind of black rock controlling 25% of Ethereum supply they're going to be using all these technologies because now they are at the hot seat they're going to be legally regulated to do it. They're going to need insurance to do it. You know, when we think about safety, like the the financial markets mechanism for ensuring safety and pricing risk is insurance. And so all those pressures kind of going to back propagate into these entities and ensure that the all these things actually happen. I think the one dimension which you know this this particular set of things doesn't necessarily solve is you know censorship resistance and like how how much

Ethereum can march on just by itself and even there I think the Ethereum protocol is designed to be very anti-fragile even if like a few percentage of validators are run like around the world you're going to have inclusion from them you know the Ethereum protocols built on this longest chain plus finalization thing so there's just like layers of checks and balance that Ethereum has built which which is why I think it is well suited to be the backbone of like global finance. So that's always been our bet. And I've always disliked this social layer haggling of like trying to say, oh, you know, you're centralized, you're decentralized. It's a protocol.

It's a permissionless protocol or it's some kind of club. We have to make a decision. It is a permission. That's what it is. It's open for everybody to build. It's open for it's open for lighter. It's open for all wheel. it's open for Black Rockck to come and do as they want because this that's what the whole whole promise of this ecosystem is. I think this is coming because there's a kind of like underlying two different views. One is decentralization versus permissionlessness. I think permissionlessness is the kind of foundational thing. Decentralization is there at all kinds of other levels.

There is people monitoring the network. They can fork the network. There's all kinds of other things that keep the network decentralized. So holding and staking can be done at various levels in using these institutions and I think it's a big net positive for more people to come and access these complex technologies behind known interfaces. That's that's how I see >> I couldn't agree more serum. I would argue you know when you look at what 2021 just after the beacon chain went live I mean through that whole year the concentration of estaking was what we would probably call outrageous today.

you'd have parties running more than 33% of the network on a single operator. Like those days are like long behind us. And I think to Sriram's point, you know, Ethereum has early on made certain decisions as part of its serenity spec and also migration to proof of stake to allow decentralization to actually exist as a fundamental element of its architecture. Right? Like on Ethereum, people at home can run validators. That was a very intentional design choice, right? institutions are not prohibited just as people at home are not prohibited from going and spinning up a node and participating in the network freely and I think we've started seeing how that's manifested just in when we talk about concentration or decentralization at the staking level I think we've continuously

seen that you know Jenny coefficient um scale into a much more decentralized landscape. >> Yeah, I just want to give you Yeah, go ahead Rob. I I had a little bit of a different different question just to generalize what we're talking about beyond ETH the asset and really take into account ETH Ethereum the protocol because a lot of the checks and balances you're talking about go beyond just ETH the asset and and you started out in this report by talking about the macroeconomic environment and the report is a great read just in the first couple pages there was you know one takeaway here that if you if you take the Treasury yield you subtract inflation these things are not profitable And so people are looking for

alternative sources of yield and I understand from what you're suggesting in this report that they can look and find that yield on chain and that probably comes through stable coins and so kind of generalizing this discussion beyond ETH asset taking into account stable coin staking and and repurposing and restaking for greater yield. >> Siri, how are you incorporating stable coins into the backbone of the staking infrastructure that you guys have at ien layer? And then maybe Mara following up like what is the demand ETH versus stable coins for deploying these things on chain.

>> Yeah. So in terms of the IGEN layer protocol I mean even though we got associated very strongly with the word restaking a permissionless generalized programmable staking environment. you can stake any asset. You can opt into any sets of conditions that you feel like you're and so the the protocol is just enforcing these conditions and ensuring that if an ABS wants to accept USDs USD or some other token they can accept it and then pay rewards. So that's that's our kind of generic architecture. It's fully permissionless for protocols to do it. In terms of where we are uh seeing demand from the ABSS at this point,

people are still just understanding how they build complex infrastructure services on top of layer. Uh the the financial services it's easier for them to understand like you know what whether to use ETH or USDC because it's kind of like okay you know what's the price, what's the demand, what's the yield. I mean it's standard equations. Whereas when you're building a new infra protocol like a storage or an AI agent or other complex things there is different like considerations in what is your asset how is it actually like you know securing your thing the general thesis that we have there is uh you want to minimize especially when you think about it with redistribution

what's happening is the unit of risk that the AVS is underwriting so the sec the the token used for security should be commensurate or like you know similar to the risk that an ABS is underwriting. So think of like a bridge, right? A bridge which is mostly bridging ETH probably wants ETH stake to actually protect it because it's saying hey every week I'm doing 1 million ETH worth of transfers so I need 1 million E of security whereas another bridge which is primarily on the same bridge with a different asset like transferring USDC wants to have USDC to secure the bridge.

So this is I think going to emerge but we are still pretty early in this innings of people understanding how to deploy complex infrastructure services built on top of layer use different assets so we still initial in the initial phases and what we are seeing is people are okay there's a lot of ETH in layer you know we we mentioned here you know Robbie you're mentioning the DAT sizes right so some of the DATs are like hey we need we want to acquire 5% of ETH and already there is like close to 5% of Ethon layer. So that's for a sense of scale the so because that already exists that is people want to actually use it.

So that that's that's what we're seeing today. But as the kind of like specialization in the market happens and these are integrated end to end right think of an insured bridge where every time you're bridging USDC you have an insurance that hey if the operator goes wrong I'm going to get still I'm going to still be solvent because I can slash and redistribute as those chains get built out you will see the specialization and okay you know I'm transferring USDC I want USD collateral so >> got it yeah just curious from your side any any uh significant demand that you're seeing to deploy stable coins uh into these yield sources on chain.

>> I mean I think there's a tremendous amount of potential for yield bearing stable coins. I think we should not be underestimated the potential of what that's you know going to going to be able to offer in the market holistically and the demand behind it. I think when I think about staking and and one of the reasons why I think it's becoming increasingly interesting as a collateral and as a treasury asset for institutions is because the nature of the yield is quite different and what I mean with that is it's truly the first internet native yield that exists that is globally uncorrelated right it is fully independent from inflation or monetary

and sovereign policy which makes it a really good alternative income product, right? And I think that framing is what we're hearing. Portfolio diversification hedging alternative income strategies tying to to staking rewards and staking yield is a fundamental sort of reason why we're we're seeing an an increase and uptick in and in in appetite and interest. Um and and that's inherently different, right, from tokenizing dollar value and then also being exposed to the the the potential inflations and and other pressures that come with the monetary policies and its purchasing power in the market. And so when you look at the the report that we wrote, one of the reasons why we took such a

big lens into the market is because sometimes I think it's hard to see the forest for the trees. And right now, lots of corporate treasury talk, $20 billion in ETH being acquired by public companies. Like there's a lot of that sort of meme culture and and storytelling and narrative that's currently driving this market cycle. But when you start pulling these things apart, I think what we're starting to see is people are moving away and have already bought into the thesis of having Bitcoin as a key, you know, part of their portfolio diversification. And the market is catching up holistically and broadly to the fact that ETH in particular offers an opportunity to move beyond passive holding and passive strategies because that infrastructure

that opportunity to you know earn and participate is natively built into the protocol and because a lot of the activity that is taking place in the market right now is actually happening on top of Ethereum as a network. And so you have this sort of convergence of things where you have an incredibly powerful tool creating internet native yield uh through Ethereum staking and that you know being natively baked into the product and then you have the world's largest asset managers and banks and financial institutions uh tokenizing treasuries and stocks and stable coins on top of the network you know securing trillions in in in value. And I think that's really like the fundamental shift that we're seeing right now. So, you

know, kind of zooming out, I've I've always seen these as complimentary strategies. To me, dollar-based yield and T bills and, you know, a lot of the fixed income strategies that people participate in will eventually be complimentary to internet native yield that is going to be fully uncorrelated. And I think that's the future that we're really seeing unfold at the moment. >> Wow. I think I just bought more ETH. Uh one really uh uh interesting or at least uh a story that people are telling right now is hey you know it's why do you need you know these uh digital native assets maybe it's just stable coin rails that's what

blockchains are you know in some sense Salana is leaning more in this kind of a thesis hey you know who can help transfer stable coins fast I think there is a an issue that I think there's a second order game here when you think about countries like uh for a different country other than the US you know maybe people want to access USDC like right now it's a it's an interesting useful opportunity for them but as you think about like this proliferates more this is a major counter sovereignity risk for a different country you know you just piss off somebody in the US and then you can't your US USD suddenly went to zero and the US has demonstrated this that this is you know uh this is how things

are going to be and so if you take the second order game what's going to happen is like the legal conditions under which you can hold you know USD stables in non outside the United States is going to get restricted and so what's going to take its place is ETH like that's our bet in the on the Ethereum ecosystem and you know when people are thinking right now oh you know it's just stable coin adoption and like just rails for stable coins Actually, that's not that interesting, right? It's it's just like Stripe. It's just a business. It's just helping people transact tokens around as opposed to a completely internet native digital self- enforcing verifiable economy that we're bootstrapping. And I

think that's definitely has been in the Ethereum ethos. I think over time as we kind of index on the stable coins, I think of this as the gateway drug going to get into. I I I I I had this tweet that got a lot of flack that was like it was like a hot take. Stable coins are absolutely amazing in the short term but very destructive in the long term. And it's comes from a very cyberpunk anti- fiat kind of mentality that a lot of us have came from in the way that I think we got into the space or at least have some inkling of that of that kind of uh understanding but have kind of been blindsided by the positive perception boost that stable coins have done for our space. It's been immensely

helpful. Uh but must must remember the long-term game here. So I appreciate that angle Shirro and Mara. Thank you for your time as well, guys. It's been an amazing segment. We're running a based rollup marathon live stream today, so we're going to have to hop back to that. Uh, got a couple more guests left, but uh, thank you guys so much. This was extremely insightful. >> Thank you so much, >> thanks for having us, guys. >> All righty. >> Enjoy the rest of the day. >> Bye-bye. >> You, too. >> You as well. All righty. That was awesome. I'm super bullish on ETH after that. Can't wait to sell more in the next couple weeks.

I think I think the right the right framing for what we what we ended up talking about there was like stable coins are the Trojan horse and then inside this Trojan horse is like ETH Bitcoin as the reserve asset like >> well they're like the Trojan horse for now but the endgame is not as Sham said the endgame is not like let's just pass around US dollars on chain and call it a day >> not not even interestbearing like stable coins on chain >> no >> the endgame is is those algo stables wherever those are going to come from.

>> Boy, I don't think you want your portfolio doesn't want those back. >> I guess we don't need that. Shiron is more like look, ETH is that. But until I mean, until Bitcoin and ETH get to a point where the I mean, even the S&P people don't transact in the QQQ because that thing can go up and down a percent or two each day. And you know, there's a reason, right? And so, um, yeah, I mean, look, we can go on for a while. We got Amirit ready to go. He's been waiting. It's late in London. Uh that's on us. We had a This has been a marathon. Uh this has been a technical endeavor so far. Honestly, we've been crushing. So, I'm stoked. Let's get Emmett up. Um and yeah, we'll continue the uh based rollups marathon with Emirate. Um the co-founder of Alt Layer. And yeah,

how you feeling, Rob? >> I'm feeling good. Emmett, welcome to the show. It's a pleasure to have you on. Um we maybe we'll just close the loop on the previous conversation. Do you think the endgame for currencies to transact is stable coins, ETH or Bitcoin? >> I mean, if you if you go back to Bitcoin's thesis, right, it's always about, you know, peer-to-peer money or decentralized cash. Sadly, because of volatility, it never will become a cash. That's that's, you know, we have learned that over the last, I don't know, five, 10 years or so. And so yeah, stable coin is is definitely the path towards uh this whatever you can call the decentralized version of cash in some

sense. And I get that with all sorts of caveats around okay who is issuing this st stable coin. Is it is it is it circle is it tether or is it is it u maker now renamed something else and then you could debate about all of that but I do still feel like stable coin is is the version that is going to be adopted. Bitcoin or even Ethereum to be to be very frank will never be a cash because of volatility. And one thing that you know to extend this argument you could see that up until recently very recently we thinking about stable coin as a as a currency that you would use in day-to-day payments right where you take your stable coin and go to a your neighboring supermarket and try to pay uh instable coin and the merchant would

accept that stable coin. That was kind of the vision at least. Um and that has hasn't happened so far. But the good news is that because of all these crypto debit cards like Rain for example has done tremendous tremendously good work and they recently by the way uh did a very good fundraiser so congratulations to them and what basically they have shown that you actually there's a there's a middle ground in some sense where the merchants don't have to change their internal dynamics. They don't have to change their behavior and they could still keep on accepting you know fiat and yet on the other side which is the user they can continue using stablecoin and behind the scenes they will do all the conversions. So you as a user you will never see a fiat in your account and the merchant will never see stable

coin in their account. >> Yes. >> And yet the stable coin becomes the real. >> So in a way we have found that middle ground that actually nowadays now I use crypto debit card almost for almost every single transaction that I do. >> Uh and my banking transactions have almost gone to zero. >> Yes. >> And so this is this is certainly a change that we could not have imagined I don't know five 10 years ago. So that's definitely a plus. Now >> do about this. Do you use the EtherFi card? >> Uh, no. I use uh I have I'm using Cipher, but uh I I plan to go ether card as well.

>> Cool, cool, cool, cool. No, because I mean we we were talking um to one of the Dragonfly partners I I believe about Yeah. Rob about how Stripes L1 with their acquisition of Bridge with their uh acquisition of Privy with them launching their own stable coin and them launching their own chain. They're going to create a system such that you never have to actually have money in your bank account. You just have a Stripe account, a Stripe wallet on the chain. You can transact, go and go to the grocery store, buy on that on that Stripe card, whatever it is, and the money actually never touches uh the bank that that you have. Now, maybe it goes to the bank of whomever is receiving the payment, but yeah, this is kind of what you're what you're getting to. Now, this is

obviously Stripe's L1. We want to get this to Ethereum, but at the end of the day, uh I I think you're you're spot on here. >> So, by the way, to to to mention kind of as a very similar example to Stripe, something that's live today, which is Revolute, right? Revolute is a is a >> you know, Neo Bank, a challenger bank. Um and they have this pretty cool feature where you have this banking application like full banking application integrated right with right alongside a crypto application. So basically you have this fiat onramp offramp service right within the same app. So example if you want to buy bitcoin using cash it's sitting in your bank account you just click and say okay I want to buy bitcoin and you press a button you have bitcoin right there. Um and then you want to go the other way

around you say okay I want to sell my bitcoin give me my money and the money directly goes into your bank account. one single place you can do offramping on wrapping without ever leaving your that application. Now imagine if you had something this is kind of what I guess striping is trying to achieve is like once you have like let's say Revolute like stable coin then you can do all of that using a stable coin as well. So that's that's tremendously powerful like I use Revolute again you could debate about the fees and everything that goes with it but for a moment uh you know if you ignore the fees it's actually a really good user experience in my view. >> Yeah. Well Emry we wanted to get you on today. I would love to talk about stable coins further, but it is the base rollup

day. We're celebrating Ethereum's we dropped this market map. Ethereum's going based. Ethereum's Ethereum is back. I mean, I don't know how I think technically we still have a lot of development to do, but at least Tom Lee is throwing clips into our bags so you can smile. Um, but uh yeah, so alt layer base rollups, Ethereum. Let's let let's kind of get into some of the nitty-gritty here. I think one of the cool things that you guys have recently done is you integrated Gataka's base stack into alt layer. I'm curious kind of like how you see that improving security and trust guarantees that developers and users would get compared to like single sequencers. Um kind of like how does this collaboration uh boost your security for alt layer

chains, alt layer rollups? Um you know you know walk us through some of this. >> Of course, of course. So um by the way let let me give you some context behind this like when I think the base rollup was you know initially announced by or proposed by um Justin Drake in one of its blog posts and since then we have been kind of digging into base rollups in different flavors. So one of the first attempts that we did to kind of implement a version of these roll-ups was through this restate rollups. And why we went through that direction is because uh if you read through uh Justin's blog post towards the end he mentions about okay if you use one of the downsides of a base rollup is like it becomes slightly more complicated to implement different kinds of sequencing policies. So for example, arbitum has the sequencing

policy of first come first serve at least up until recently and that kind of policy or a different policy would be a little bit more difficult to implement unless you have like a some sort of a middleware network of these L1 val validators that opt into that specific sequencing policy. So what we said that one way to circumvent that is to build like a restake roll up where your sequencers are basically restaking ETH and they become they decide to become your sequencer and they could then you could implement whatever sequencing policy you have. So it it's kind of like a like um side card to a proper base sequencing but it gives you the benefit.

So it kind of circumvents the limitations that you have with base sequencing. Anyway, so this is kind of this initial our venture into base rollups and of course as you said earlier we have you know been working very closely with Kataka uh recently which is uh basically a project by Titan which is one of the biggest if not the biggest builder in the Ethereum ecosystem and before talking about the security and decentralization which of course it's important but people often care about okay I don't care about I care about performance right that's often comes out you know especially if you compare with Solana uh speed and and and and performance And to be honest with you, when we built out and when we tested this integration of um getaka internally and we wanted to present to a client which we did the

client unfortunately I can't name them because of NDA but the client was really shocked with the speed that they saw uh because the betaka has this um pre-confirmation built in. So you actually and we actually have to take a Rabi wallet and kind of had to integrate their pre-confirmation module in that Rabi and you could see that your transactions is is is like cannot even like it's so fast that you won't even realize it's actually even being processed right it's really fast so so this aspect of people okay feeling like okay you know are we going to match Salana speed are going to match you know these speeds that are coming up or for competing chains that definitely is going to be settled you could see that literally I mean Spiralabs um I think recently posted or M team from Spy Lab

post also you know you will see microscond uh bit of block time of transaction speed coming up and which is actually coming up and we have experienced that ourselves with um attack and I'm pretty sure you would see that with Spiral Labs as well. So that's that's on the performance art. You definitely can match anything or probably even be better than Solana speed on the decentralization component especially the liveness component which we have seen by the way even in you know established lurops like optimism arbitum they have been instances where the sequencer was down >> you know because of AWS outage and so on and that kind of goes away immediately because you're relying on an L1 sequencer you get that benefit and that's especially important for timesensitive transactions especially in the world where we live right Now where

per dexes are dominating the world, you want to make sure that uh liquidations happen properly and if your sequence is done, your transaction will not get processed and so it's important to have those live guarantees and that comes natively if you use based sequencing and then of course that also gives you all the security benefits that you get from this. So for example, let's say in the current centralized sequencing model most in most cases there's one foundation that's running the you know sequencer or you have a ras partner like all player that's running a sequencer and again there have been instances where for whatever reasons the the sequencer was down and then you're basically the chain is stuck you know people are not able to send transaction that kind of goes away because of the decentralization that comes natively from the L1. So we are actually

improving not just decentralization security but also performance that I think has been always a know a a question mark that okay can we can we beat Solana's performance that definitely you would see that very soon >> and so as more of the ecosystem transitions into a base rollup or goes from optimistic to ZK rollups Ethereum is going to evolve with this alt layer and its rollup as a service model helps to run a lot of the infrastructure that helps support these roll-ups. What do you think about the transition of how these roll-ups run their infrastructure?

Do you think it this is going to become a little bit more ubiquitous and and the support is just going to continue to just kind of stay flat or will it evolve and you will continue to evolve with it um as as these changes happen? >> We definitely will evolve. So for example today as a RAS service we are the one running your sequencer is as simple as that and the clients don't even want to bother like they say okay you are my partner you're you understand the underlying stack very well you run the sequencer in some cases they say okay um you can run the sequencer but we have control over the keys in some way so they basically delegate the key and then if at some point they don't like a Raspberry they could say I'm going to delegate this key to someone else some

other Ras vendor so they want to control in some sense but there's actual sequences being run by the fast provider. Now um many of these basic you know roll-ups they will have different eventually they will have different configurations in which you could run these sequences. So a very simple model would be a a basic round robin where I don't know let's say somehow after a certain time here you know you pick a sequencer and that sequencer does something you know orders transaction for you or you could have like a you could decide many different kind of policies. So it actually gives flexibility to the to the builders to say okay fine even if we don't want to decentralize the whole thing what we could at least do is we could run two sequences in some sense one being run by us so all and the other could be run by

the partner so uh the the the the actual client itself and then you actually have a balance if let's say for whatever reasons if the ras provider actually goes down you still have a sequence that that that can be used. So the answer is yes. It it it will evolve in a sense that we have to accommodate other partners in the sequencing landscape um and that we're open to it. >> Yeah. Yeah. I mean it it it does seem like there's a like the benefits that you get from using Ethereum sequencing seem to be very very strong in terms of composability in terms of uh actually getting uh the properties of Ethereum L1. But I I'm just not sure. Do you think like builders are going to be convinced that this is the right way

rather than just running a single sequencer, spinning it up, not dealing with any of the technical headaches of setting up a base rollup? Like like I think Spire maybe is working on like a base rollup stack that could like plug into alt layer. I don't know where they're at in the development of that, but it's just still seems to me like a technical hurdle to to get this over the line versus just doing it kind of the I don't know I guess like like the normal way. Now >> you're right. So I would say that even so there there two parts to this. One is like over the last I don't know year or so the demand for rollups have definitely gone down. We are seeing that from our client perspective like there's a time when we basically rejecting clients. We didn't have enough manpower

bandwidth to handle them >> and now that definitely is not the case anymore and so definitely the demand has slowed down. Now having said that you could see some of the bigger players coming up now. So you know the likes of Robin Hood, the likes of Stripe, uh the likes of Circle and so on. And again unfortunately I can't name the name of a client but they are a really big client and they are actually exploring our base rollers quite actively >> and it all all it takes is like one or two clients actually committing to using it and once that comes in then you as a let's say smaller client you as a smaller rollup you would want to be able to compose with that >> bigger roll up in some sense because that bigger rollup let's say stripe for example if stripe decides to become a

based rollup which I hope ethereum foundation convinces them to do so or paradigm does that. But anyway, so whoever convinces them that once they convert to to a base roll up, then a lot of other smaller chains would definitely want to be in that circle of of composibility. So that will also help help push the demand. But I would agree that it's still very early stage, you know, nothing really has gone live from a pure base sequencing roll up. So I would say give us another six to eight months and then we'll see some some uh some results out of this.

>> Got it. and hopefully from learning as well. >> And so I'm I'm curious like you know without kind of naming names it it makes sense what you're saying the the smaller clients and rollups uh will have the network effects of tapping into a larger one once it's there. But the first one is kind of the pioneer right there's not really existing network effects for the bigger one to start off this train. So what are they looking at? Why are they looking to be a based rollup? E, you know, even though they're be they would be the first one.

>> I think it's a lot of alignment for sure. That's number one. Um, and by the way, what you're mentioning is is is this network if it always has this chicken and egg problem, right? Okay, who's going to be the first? And we have seen that in case of you know uh you know decentralized shared sequencers platforms that were being built including for example the likes of espresso where okay I would join in if others are in right that's always a question um and that's always a question for at least the smaller people or let's say medium or chains that are somewhat in the middle right but the bigger ones they don't care right bigger ones they know that they have their own distribution so they don't care and they in my view they would be the first ones to actually go and say I will be the

basic answer or I will I'll go with the basic sequencing model because they don't have to worry about okay where we get users from and so on because they already have that user base. Now um the the challenge will still be like okay how do you and what do they see in in base sequencing my view is of course the first is alignment and it has to come from ethium foundation in my view has to convert at least one of the biggest or the bigger players to say okay you should commit to become a base sequencing and then the rest will follow automatically convincing uh and the reason would would be one is the speed like if people say okay if I do by the way I've tested that myself so basically if you look at vanilla op stack and vanilla arbitrum and uh if you look at

the stacks coming out from spy labs or even even gaka the speed is actually faster so the base is you know especially from pre-confirmation that you're getting is actually way faster than what you're getting from a vanilla rollup today again you cannot compare exactly the security uh you know parameters here but at least in terms of performance you actually feel it is way faster so of course that speed will matter especially if you're a bigger player like stripe or someone who wants to settle transaction really be fast. >> Fascinating. Well, Amar, I appreciate you sharing that insight with us. Um, the base rollup ecosystem sounds like it's ripe uh for some growth and for scale. And I think you helped to remind us about the network effects of the

based sequencing. Uh once we have a significant player that goes live as a based rollup, we'll start to see these smaller roll-ups jump on and tap into the network effects of synchronous composibility. Indeed. Indeed. >> Awesome. Thanks so much for coming on, man. >> Amber, get some rest, man. It's been it's been a marathon for us. I think we have one more left. It's been like three hours. We're pretty cooked. I think this now we're having tech issues on Twitter. It never it never ends. >> Well, this is this is this is uh technical stuff that always has glitches. Anyway, thanks Andy and Robbie for for hosting me and uh well, good luck with the rest of the show.

>> See you in Korea. Yeah, I will not go but you know you'll see Yao >> in Singapore. Yeah, >> Singapore. Yes, >> you'll be there. >> Yeah, I'll I'll I'll come. >> All righty. All right, Embie. >> Yep. All right, guys. Looks like we're having some uh weird little issues on Twitter. We're just going to keep the stream rolling into uh YouTube and um otherwise, yeah, it's weird. Looks like the entirety of Twitter or X streaming is down. I I see. I don't know if we can even get X back up.

No, I I see uh I see thread guy is also down. His stream will not play. >> So, yeah, >> looks like Twitter streaming is down. That's all good. Let's get Harry up. We'll finish strong on YouTube here and uh we'll get uh we'll get Harry and we'll get uh >> from Puffer >> or we can or we can or we can just move these. Rob, what do you think? We should just go through them, huh? >> Uh yeah. Yeah. Let's let's run through Let's finish up the base stream strong and uh we'll keep moving.

>> All right. Run through the finish line here. >> Cool. Let's get Harry up when we can. It's been a pretty pretty fun stream so far. Kind of kind of reminded us about bass roll-ups. I feel like we had so many conversations about bass roll-ups three months ago. >> Yeah. >> And then the >> Yeah, they they kind of just faded into the abyss and then Yeah, exactly. So, we got Harry coming up. We'll get him on stage. Uh again, guys, I don't know what's going on with Twitter. Our apologies. Uh feel like I wonder just I don't really know what's going on.

>> Yeah, that's all right. We're still live on YouTube and uh >> let's get Harry up >> in the back. >> Good to see you, man. >> Good to see you, too. Long time no see. >> Yeah, show. >> I think we saw you last in in can. >> Yeah. Yeah. About that time. >> Yeah, man. We We are on a base roll marathon today. uh you are our second last guest. We've talked ZK pre-MPs. We've talked composibility stable coins that we're going to talk block building today. For those of for those of the community who's new to Luben, maybe you can give us a quick primer as to what Luben is, uh what you guys are focused on, some of the recent developments.

That would be great. >> Yeah, absolutely. Uh so I think first of all, uh thank you Robbie Andy putting this together, the whole rollup team. Appreciate that. um saw some familiar faces, been a little out of the loop on the socials, but uh happy to see everybody still keeping up the good fight. So, uh for us, we're trying to do our part to make B roll up a reality uh to Ethereum because for obvious reasons, it's good for Ethereum. So, uh for us, um I think uh for the past 12 months or so, we've been deep in the trenches with the base rollup teams, teams building around the base rollup. Um so we have a pre-confirmation protocol that's how we started and L1 um basically addressed

the problem about how we can allow the L2s not only the base rollup but kind of the focus was for for base rollup to really settle on the L1. So this kind of like the bottom of the stack to begin with. Um in the process of building that um learned a lot of lessons one of which was that when talking to the validators validators was like okay base roll up good but how do we actually meaningfully get revenue how do we connect it with the the base rollups so um we knew that we need to figure out a way to really uh connect the roll operators blockers and validators put them into one picture. So now we have a delegation framework where we allow the validators to delegate the

sequencing right for the base rollup to uh specialize the parties like the gateways some people call them block builders or sequencers um so um just lately I think in the past two to three months we also um collaborated with the tao we're building a gateway for the tao as well so kon is not live or um on test net but he's currently in our closed DevNet has been running for three months. So I think as you can tell there's kind of like a pattern there like we moved it from the very bottom of the stack uh how L2 gets uh interacted with L1 then we're thinking about how the validators uh can participate in this process and eventually how we get a

sequence uh for the reser as well. So I think there is a last step which I will call it 2.0 know which will be the focus for I would say the next 6 to 12 months I can't really talk about it really like I don't want to fumble the announcement that's I can't really give too much detail but uh uh want we're moving even up uh in terms of the b the stack we're talk we're working with the the real user the application developers uh to really build a product that leverage the base world technology uh for the users so I think that's basically the tlddr uh about us what's been happen in the past 12 month a near-term road map for what will happen in the next six to 12 month uh time

horizon. Um yeah. >> Uh man, I wish we could ask more about what you guys have, but don't want to push you too hard on the announcement and let the cat the bag. >> Um Harry, I'm curious about your take on something that happened recently um in the gas market on Ethereum. We we kind of talked around this subject, but we didn't really talk about this with any of our previous guests. So maybe it was about a week ago, maybe earlier this week, uh, World Liberty Fi launched on Ethereum mainet and spiked gas fee. And so recently, gas has been around one guay, but this this kind of pushed things up. And so I'm curious from your perspective, do you think this is a

positive or a negative thing to see that okay, we actually have a gas spike? And would you anticipate that if we get another popular application and everyone's rushing to go claim and you know buy or sell, would this happen again? Should we expect it to happen again or is there parameters and and you know changes that we're putting into place to kind of level out the gas market going forward? >> Yeah, I think that's a good question. So I think I think this is not the first time a similar thing has happened, right? is not only on L1 but even on L2s I remember two years ago or like one and a half years ago there was a layer zero R drop or something on arbitum

>> that even drive up the block price so I think the price for block space is really just a matter of like supply demand dynamic uh you can have a certain kind like function uh to stabilize that um or have but there will always be design trade-offs like EIB 1559 is common hazard that has I think there's no problem with that So um from from my perspective I think that's a good thing I mean is that people are still using uh Ethereum uh and I think that kind of pushes the um the narrative around like why should we scale the Ethereum L1 even more. I'm totally in that camp. Um so I personally would think that things like

this will happen and it will happen over and over again. Uh and in my opinion that's overall a good thing because that basically is proven that people are still using the chain. Um but in terms of how we can actually address that uh there's many ways to do that. So for example uh we have our L1 protocol pre-com protocol but uh in a way it's almost like block space futures like people >> applications can actually buy up block space and allocate the block space in advance so that uh they can get a deterministic price for that. So they don't have to let's say application buy up 10 million gas for future block then their user can enjoy that they don't really have to fight for uh the block

conclusion um I'm sure we're now the only team building around that there are ETS many other team are trying uh to do this uh so I think there are solutions to this and I think this will not be the end of it it will happen again and again and overall I think it's a good thing >> yeah I Gas has been so low for a while. Like it's been under two guay for some time. Um, one guay really. So, it's been good to see. And also, the gas limit was just raised to 45. I think it gets raised to 60 next. Um, man, I'm curious if there's been any new developments in block building, like if there's been any more uh, you know, in interesting uh, happenings from, you know, searchers,

proposers, if there's any been there's been any uh, developments in the MEV supply chain that you've found interesting maybe in the last quarter like has there been any new research or anything that that you guys are kind of like interested in at Luben? I I would say that there's a lot of interesting things but I think the one particular thing that interests me the most not necessary valu uh which is actually hyper liquid I know this is about base roll out it should be about base roll out >> that's all good >> okay I do want about talk about like this interesting dynamic between hyper EVM and hyper core >> because um I think every other major change like swana ethereum all have this

kind like me solutions like on theum we have flashboss being the first one on salon we have jetto um I wouldn't be surprised um there will be some kind of a similar protocol um being built um on hyperlquid between hyper core and hypervm because um how the hypervm works is like basically every call from the EVM uh to hyper core uh is going through the public and you can actually buy and sell assets uh controlled by hypervm M and you can sell and buy asset on hyper core which go through the public mele if it goes through the public pool they'll be front running arbitrage all things so I think the volume is not there yet um

and so it's not I I think hyperbm has probably only been live for half a year maybe give or take so we haven't seen a lot of me activities uh happening um at least in the public discourse I'm sure people are smart people are doing that uh but we have it hasn't gotten to a point we need to address that but I I think it won't take too long um for some measure being put in place to address that issue um especially um the hyper EVM u ecosystem that gets more mature so I think that's just a um further kind of a proof a point whenever there's a public blockchain there's promotion of the blockchain there will always be related similar with base roll up as

well uh I think when it comes down to base rollup I think my value proposition for base roll up is basically everybody know that it's good for Ethereum but what does it do for a user right like can they actually compete with arbitum optm and all that my value proposition is that basically a synchronous composibility aspect of it so the base rollup user can actually enjoy the benefits of being composible with L1 or um there are some novel designs that been discussed by Tan about like you can actually use ZK EVM to never really bridge your asset from the L1 to the L2. Um >> for example like you can lock up your

fund into a vault on L1 and you generate a proof and send this proof uh to the L2 and the L2 know that this money is being locked then they can mean certain token and reuse this L1 asset uh to collateral to open up uh like uh per positions for example if it's a per DEX. Um so of course there's a timing difference between the block time there because if there is a timing difference there was always me. So I think a synchronous composibility because this is a very new thing I have yet to seen uh I've yet to seen anything live yet. So it's a bit early to talk about will there be me involved. My answer is of course 100% there will be MV involved if this kind

of a gate become like gate is open. Um so I think that's something in the horizon uh that I think will happen and uh we um we're very interested in uh figuring out what product we're featured to build along this um this kind of like new a new development around M and M supply chain. >> Yeah. You know, I was on a date once and or no, I was on a date. I was hanging out with a crypto girl and she was she she she asked me to explain to her the me supply chain. I couldn't do it.

>> Well, I could do it, but but it was hard. >> Yeah. I I think is really everywhere. I think is just even in real life like there's a lot of close analogies like you know like sneaker botting uh scene. >> Yes. The 2016 sneaker botting class. >> Exactly. >> Exactly. Elite block building right there. Harry, what's the uh what's the what's the revenue model going to be like for for Luben as you guys get these new products rolled out and get these in integrations dialed in?

>> Yeah, I think that's a very good question. Uh I think in general there's a lot of ways to make money in crypto, but I think in my opinion the proven way to make money in crypto um are only two ways. First is swap fee driven. uh you think about uh unis swap, hyperlquid, any exchange or central exchange like binance. It's basically swap driven. The other way is uh balance sheet driven. Uh it's more like a defi model. Uh you can think about etheina like you have a lot of money, you just park like people want to earn yield in a kind of like a risk averse way. You just park your asset there and you make money. Um so I think this new product we're trying to build

is basically a combination of both. Um so because this is a proven strategy to make money uh to generate revenue. Um and historically uh this are two targeted by two groups of users like swaffy driven applications are more for the speculators traders uh they want to earn like 10x 100 sx upside. Then you have another group of users like uh uh defi power users or farmers. They just simply have a lot of money. you just want to park there and have a more productive use. How to really combine this two together is basically the question we're trying to answer here. So I would say that

>> that is the revenue model here and how does that relate to base rob because >> everything that we're going to build are >> basically be built on top of the assumptions that we're going to use all the infrastructure we have built so far for the base rollup means that Ethereum validators Ethereum alone can actually get a share of that because I think uh the angle maybe not angle but for me it's like why base roll up um I I mean the first answer is like it's good for Ethereum but how we have to figure out a way to really um share some of the revenue with Ethereum outline but why application do that why will do that uh is it just because of out of the um it

shouldn't be run like a charity why do because >> people should enjoy think synchronous composibility capability for the base rollup and people should pay for that and the synchronous composility So you're always talking about not only the L2 transaction but L also L1 transactions. So you can imagine that if every transaction on the base roll up needs to be synchronously composible with L1 that also means that they need to pay L1 transaction fee and people want to pay that >> because people want to use this application. So, um, that's kind of like how I think about the revenue model.

Different revenue. >> Yo. Yo, Harry, you there? All righty, guys. All right, guys. Yo, Harry, you there? Okay. >> We got him. We >> We got you, Harry. All right. >> I can't hear you. >> All right. Great. No, no, you just I think you I think you were closing out there. Anyhow, I think that was uh >> Did you have anything left to add? It just kind of cut off on the last minute or the last like 10 seconds there.

>> I think that's good. That's good. Uh I pretty much made my point already. Cool. >> No, I think I think that was the last thing that we had from you or for you. It's been a marathon today. I think we're we're we're going to wrap this up. Uh thank you for joining us and being a part of the base ro day and uh yeah man uh looking forward to the upcoming news that you guys have on on on the luben. I'd hope to get you back on soon. >> Appreciate it. Robbie, thank you so much. >> All right. >> Absolutely. We'll see you next time. >> Keep cooking, man. See you soon. >> Take care. >> Cheers, buddy. >> Cheers, brother. >> All righty, guys. Um man, what a day. Of course, Twitter bricks us at the end. So close. We had that thing rolling. 10

guests, no issues. Thing was doing popping on Twitter and >> shout out to Ethereum. >> Shout out to Elon. Great stream. We'll have to we'll have to recap this tomorrow morning. So, we'll have to do the we'll have to go over the map tomorrow. Talk about the map. Talk about the stream. Um, and kind of throw that in there for half hour tomorrow morning. >> Yeah. Yeah. I think that is on the docket. Lots of cool topics today. I think we're gonna wrap up. It's been three hours.

>> It's been a journey. Thank you guys for being here. Uh shout out to Elon. Thanks for rugging us. And uh see you guys tomorrow. Can we get the end screen please? Roll. Roll credits.