The Future of Governing Rollup Infrastructure

Transcript

[Music] okay hello um welcome everybody I'm veryy happy to host this panel and you know have the opportunity to talk about something that is pretty much important such as uh rollup uh covering rollups um also very happy to to talk about this alongside with this chats and yeah um uh I want to say that at the end of the talk we are obviously uh open for for question from the public um yeah I right now I'd like to give a chance to our West to to you know uh introduce thems so uh you know talking about um what are

you working about um um uh role uh background you know so uh let's start with You Chris and then hey my name not working okay uh so my name is Chris uh I'm uh governance lead at el2 beat uh if you don't know al2 beat we are doing uh assessment of the level tws we are this independent Watchdog that tells you why you shouldn't use most of them um and what risks are involved when you are actually using them um and yeah and I'm governance lead so as Al to be we are big delegates in uh many

different especially L2 Dows and uh usually it's me behind the scenes like doing decisions and uh um discussing stuff alongside with sinas who's also suar that on on the audience so yeah like that that's me that's what I do REM hey uh my name is Ram I'm on the da relations team at the arbitrum foundation so in addition to the arbitrum foundation's three mission statements which is to advance the arbitrum tech stack uh to work on strategic grants and Partnerships and also on education and awareness uh especially as it relates to the DA the

arbitrum foundation is there to support the da in operationalizing whatever it is the da wants to do um as long as it's of course legal and possible right thank you guys um I want to give a a little bit of context about uh this panel in term of currently maybe um three of the most uh you know important topics right now that are currently also uh very critical Trends I will say are about um cross through ecosystem I think that this is a very hot topic but also Revenue there's uh you know uh so much question about it and then security so uh I want want to

give my first take in in general so the first one is um building rollups is pretty hard that's reality but uh the same thing applies to D basically um so in this situation I think that we are maybe in one of the worst situation to maintain this is some sort of uh smart contracts I mean uh when when you have a protocol that has um uh you know more than one goal then the thing about building the infrastructure and then maintaining via dowo uh will become

pretty difficult but but yeah um I want to start uh asking you Chris uh a very simple question and it's about um why uh we why we need a governance uh for rollups what would we uh you know the rational behind well it depends uh it depends on you know from rollup to rollup uh it depends what the governance is actually managing so usually you know usually the the reason why we have governance is because we wanted to decentralize uh the system we wanted to you know push the responsibility away from the funding team to a group of token holders and delegates representing them uh to make

decisions um about like what the protocol should be doing uh however I would like to point out that from the ecosystem to the ecosystem it is different it like all those Dows all those uh L2 ecosystems are not the same uh for example you know arbitrum dowo is totally different right now in practice than let's say optimism Dow and it is totally different than Zing though and it is totally different than what scroll down is becoming right now because they govern diff about different things the processes are set differently and their responsibility is different so for me

one of the you know most interesting things to observe is arbitrum versus optimism as these are like those those two different approaches to how to actually set up the governance so our you know optimism is starting from the from the top to bottom like they started very centralized with the foundation and they are now gradually decentralizing parts of the ecosystem to the community but preparing the community with certain processes structures uh you know best practices they they are basically curating how this ecosystem should be governed before pushing this responsibility to the EOS to to to the community on the other hand arbitrum

took a totally different approach it was like a yellow let's simply push the responsibility to the Token holders and we'll see how it will go and for those that of you that don't remember it almost collapsed uh in the first week as uh the first proposal that was to ratify the Constitution and the things how the Dow is set up basically failed initially uh which was actually a good thing because that made the the the the all the community participants active it spread a lot of discussions and arbit is building bottom UPS so it started fully chaotic uh without any structure without any processes nobody was told what to do

basically delegates were like yeah like we're here we will be voting on whatever you you know give us to vote for and we'll figure it out down the road and it is figuring out down the road so like right now we are figuring out how actually do we manage this how actually do we what processes what structures do we need to set up in order to make sure that this you know this exists 5 years from now because when we are thinking about those governance structures we are usually thinking about today like how does it work today uh you know what can what should we do in order for it to be effective today and the like more interesting question is how is it going

to be doing like 10 years from now when all of us you know if everything goes as we plan all of us should be retired at this point right we should have fun and uh do our stuff but those protocols need to still exist and you know operate effectively and there will be no like those no no backups like those centralized entities funders um helping helping the protocol so the question is how we how we create this to sustain longer than to sustain us to you know to to to be longer than ourselves yeah that's a very interesting point and I think that one of the most

important thing is like uh because we have a you know it's a very you know a strong competition I mean um we have very different approaches and that's great because uh you know uh every rollup is trying to execute their own strategy and then uh we see uh how you know um different strategies um eventually will uh will end up in you know different implementations and then different ways to think uh what the Dow should do uh what is the role of the you know all the stakeholders in that uh in

that ecosystem um you know what are the safeguards of the main main protocol and so on so this is a very uh interesting uh you know uh question and the same space about what to do next uh in order to have a well established uh way to govern rollups uh over the time um I want to jump uh directly to talk about the Arbitron case uh a little bit more because um so uh one thing Kos for the arbit Dow because uh in fact I think that is the first that implements uh actually on

chain governance uh that's a a big thing to to say congrats um but yeah uh I I would like to to understand a little bit more from the point of view of the arbit foundation uh what what will be the main goal of the arbit ecosystem at Le from your side and then uh how this translate into the you know General uh conception and strategy and future of the protocol itself sure so I mean as Kristoff alluded to uh the Dow had a bit of a chaotic more Bottoms Up organic uh start and since then there's been a lot of activity I think over 350 snapshop

proposals 50 tally proposals over 700 million in AB being spent from its treasury um and interesting enough regarding the overall goal the da is currently in the process of ratifying its purpose mission and vision uh so I think the latest draft is something along the lines of purpose being uh able to scale ethereum without compromise Mission being uh able to enable uh people with the freedom to build their best onchain world and I think the key word there is freedom and I think it uh is reflected in a lot of what the arbitrum text stack is actually used for today uh so for example now the arbit EOS system is um you know trying

to grow the ways in which the tech stack the Nitro stack is being applied and used uh mainly through two ways so one is the orbit uh so orbit basically gives anyone the freedom to permissionless build and launch their own chain that can settle to any parent chain be it layer one uh Layer Two or even non evm blockchains uh and on top of this Builders of these customized blockchains can um configure things like gas fees governance tokens um block times Etc to really meet their own needs uh number two is the uh Inception of stylus stylus went on mainnet I believe a couple

months ago uh the Dow basically uh yeah ratified its existance with stylus it will help on board millions of non web3 developers as well so using uh web assembly wasm you can basically deploy smart contracts in languages other than solidity so rust C C++ and uh there have already been multiple initiatives to push growth uh in these two vertical so there' have been two gr programs from the foundation focusing on stylus and orbit uh recently the da just incepted the stylus Sprint which is a 5 million uh Grand program to

uh support people building in stylus so yeah back to your initial question I think the The Da is already doing well in setting the direction of the ecosystem and uh we're there to support if I may jump into that because like what you said about this Mission Vision purpose uh fortunately I'm here you know I'm the delegate in arbit but I'm also a delegate in ad so I can fill in for them not being at this panel and I would say that this vision mission purpose is actually something that every single L2 could say every single L2 at least etherum based L2 its Vision it's like its whole purpose is to scale ethereum you know Without Limits to to create the

best ecosystem for Builders to build on and it's all true but when we are thinking right now about so so and you know this competition about those l2s they are all fighting with with each other like we are better in this we are better in that we we do better this but if you look into where the real like where the real product Market fit in crypto right now is like go check coin Gecko and look at Tron volume yesterday like every time there is some turbulence in the market I like going into Co Geo and checking Tron volume because it consistently is around its whole market cap it consistently is above $100 billion daily volume this is the product

Market fit for crypto and where is it happening on Tron you know his Excellency is basically deciding where this money is actually stored and if you can transfer it or not and this is wrong like the reason why we are building those rollups why why you know why it all matters because rollups are objectively better than Tron why because they are if at least if they implement all the things that they are supposed to implement you can check it at l2b if they do uh they are secured by eum and you no longer have to you know trust into his Excellency or Ram or whoever else to run your rollup we actually had

a very good uh situation recently because dydx basically seized their operations on ethereum they move to Cosmos for reasons that I will not be expanding on right now but they moved to Cosmos and they basically shut down their operations on eum when they did it there was still 7 million locked in a bridge of DX and even though they turned off their service they basically left ethereum if you have your money stuck in this bridge you can always go and take it out and unlock it on eum because that's what

scups give you if they are implemented properly that's why arbitrum and optimism and scroll and zing and all the other ecosystems that I will not mention all of them because there's like more than a 100 right now are better objectively than for example Tron and our all goal is to basically to make the future in which hundreds of billions of dollars are transferred in a system that is you know incredibly neutral incredibly permissionless incredibly trustless amazing yeah I think that you know um the idea of rollups uh be um the main home for users to transax and do

very high volume the any kind of activity is a very great uh thing to to see to happens uh very soon uh well it's really happening but it could grow you know uh thing X from here at least in just one year let's see what happens um but I have uh one question about uh okay we Now understand what is the bull case for rups itself but I will understand the you know the the the other side of the thing that is uh currently uh and this will let me also to introduce the ideal clusters um but currently um we have a different

uh ecosystem and tend out that are pushing so hard for you know to um deploy uh adopt different technology Stacks um or rollup Stacks um I would like to understand then uh what is the bu case for DS uh spending U money to to push pretty very hard to adopt that specific stack such as arbit uh what could be uh the the reason to hey uh let's uh just uh use some some some part of our money the treasury to allc at there and then say okay we want to have uh maybe uh 10 20 I don't know uh chains using

the the a specific uh roll of Stack what what should be the way to see uh why we are doing this and you know uh using the DS for for that purposes sure so I think it comes down to flywheel effects it's a term that people like to throw around a lot but I think it's the term that makes most visual sense so you know more Builders more orbits more users means more train revenues uh but beyond that it also means you know more liquidity with the within the arbitr ecosystem it means more synergies between all of the players within the arbitr ecosystem if you build an orbit stack or you just come to the arbitrum ecosystem you now have access to all of these amazing daps

that are already building on arbitrum and will make it even easier for you uh to use these Services I think Camelot for example if you were to launch uh an orbit chain on arbitrum they will come and build their native product on your own orbit stack and then I think going one level further now assuming we have these new orbits new Builders new users we have more and uh greater diversity in the stakeholders who should be interested uh at least perspective in governing how its ecosystem moves forward um and especially if you look at all of these D programs there are a lot of benefits to actually participating in them so now all of a sudden if you are

an orbit chain and you're just plugged into governance maybe you have a governance analyst who can you know do all the dirty work on the forums and uh keep you up to date you now know what Grant programs what incentive programs uh what community benefits there are for you as a builder or an orbit chain within the arbitr ecosystem uh I think one thing to note is that arbitrium could do better at building that Narrative of you know hey we are all here we're all part of the arbitrum team we're all orbit chains uh because right now there are believe 60 to 70 orbit chains but they're all quite unique which again comes down to the freedom and flexibility that Orit chains give you uh but yeah I I hope to see every orbit chain being a delegate and

uh being active in in arbitrum governance because yeah we're all part of the same community and uh I like to think of it as a country analogy if you think of uh arbitrum as a country in the world of ethereum orbit chains you can think of as towns or businesses who come and settle and build in the country of arbitrum uh they should all be interested in how the country is governed because yeah the sucess success of the country will uh impact their success too cool that that makes makes me think about um you know the typical uh you know uh critics about um doing this some sort of uh deploy uh you know what type of change you want inside of ethereum or

you know uh that people say hey but we're facing with uh liquidity fragmentation and different security models how to track this uh and then uh you know the different uh lab teams are just saying okay we we can uh aside of you know building this stack we can uh build things on top of it like uh okay let's just align different chains uh together with some soft of cluster and I think like differ models I mean uh model such as the sub chain uh it's is very different to the orbit model or hyper chain model and and very other that probably we we we will see uh in the

next year um but you know the design space for uh in this vertical is you know is pretty pretty big and I think that uh there is a lot of things to to to think about um but I'm curious to uh to know the you know the position of l2b uh with youis about um with this different uh approaches to to align uh roll of the stacks super chain hyper chain orbit how do you deal with that situation because I think that the criteria might vary depending of the of the stack or how the you know the interoperability is going to be and um

maybe uh it it will be uh quite hard to follow right so there are several things to discuss here uh first of all from our perspective following the common architecture uh you know and following one of the already battle tested Solutions uh is a good idea like basically building rollups is hard uh building good rollups is even harder so we would like for people not to try to reinvent the wheel every time they are doing something simply for the sake of doing something differently it's much better if we you know and I believe that at the end we will unify at some maybe

not one but probably several different uh architectures and we'll stick to them because simply there it cost so much to develop those things and it costs so much to audit them battle test them and make sure that they are working that it simply makes no sense as for the user from the user perspective the end goal is for them to not make a difference if they are using one chain or another and especially one architecture or another so you know while there is a huge difference uh between optimistic chains and ZK chains for the users like hopefully soon they will not have to understand that they

will the only thing that they will have to understand is whether those chains are secure whether they actually implemented all the things that they were supposed to implement and by the way you can check it at al2 beat um so if if they are green on L2 be then it doesn't matter how exactly is it built uh the chain might have their own uh reason to do stuff you know their way to customize some things maybe they need shortel block times maybe they need something specific maybe they want to address me in a specific way there are you know ways to optimize stuff but they shouldn't be for example or at least I I

believe that in a few years we'll come up to how exactly do we settle on um on on the main chain how do we prove that things are going as they are supposed to be going we will settle on several different mechanisms for interrupt to make sure that the movement between those chains is smooth and you know it will be it will be that like there will be still Innovation but there will be no reason to try to reinvent this the same way as Microsoft learned the hard way that you know two operating system for mobile phones is maybe enough at least for now uh and it it takes enormous effort to try to push for a thir uh so if Microsoft failed then probably many

will fail as well uh the same I believe will become in a few years um in rollups as in simply building a rollup from scratch will make absolutely no sense uh however I think that there is you know there are other things to to this clustering um uh theme and in my opinion one of the main themes that we will observe soon is user adoption like having those different things in your ecosystem like extends your offering to to different Target audiences so and some people say hey do we need so many chains do we need so many l2s and in case of do we need so many different

Technologies I don't think so but do we need so many different companies providing services in this financial sector of course we we need them like simply look into how many banks do we have in the world I could imagine each Bank having their own chain because they want to have their own infrastructure not necessarily developing their own chain from scratch but running their own chain why not so because they are the interface to the customers at the end they are handling the customers they are gathering the customers and making money out of them so there there is a place for way way more chains that we have right now and they will be clustered

because it makes sense because the users will be able to explore different offerings uh quicker but not necessarily building things completely differently like s for simply for the sake of building things differently and I think as these clusters grow people who decide to maybe build an orbit chain a bit later will see and learn maybe from the lessons that existing orbit chains have already taken they'll see okay this use use case is kind of similar to mine I want to see how they've deployed the robber chain and then maybe I'll modify something very slightly to align best with with my use case yeah so one thing that I'm I'm worried about is like okay so we're are going to have several chains um that are

focusing on very specific side of of you know the the market uh or taking different verticals you know uh D5 nfts uh games whatever um but but my question is how to sustain all this chains because maybe a few of them will have a secure uh their you know their buget for a long time but maybe it's it's not the it's not the case for for all the rollups that are today deployed right so my question is how do you think or or how do you envision what will be the you know the mechanics are at Revenue

because right now we have the you know the assumption that uh if you know the amount of user is sufficient uh to you know to supply with fees uh to to the chain to sustain itself andless the basic infrastructure we're okay uh but if it's not the case uh what else we can do in the meantime currently we have a lot of incentive uh from different te with you know the token uh you know Grant and so on but is this is will not be lasting forever so uh what what could be the other options what do you think about uh who who to think revenue for you know for the

healthy of the chains so I think do you want to go first yeah yeah I can take it so you know it's easy like they will need to find customers that will pay for market price for what they're offering if they don't they will die this is the the same as with any other startups you know blockchain and and rollup is just an infrastructure for them they need to figure out like how to serve their customers what are the customers where are they and how to reach them and how to convince them to pay them money if they do they will survive and most of them will have to figure it out and will figure it out one way or another sooner or later uh there are many ways on how you know chains can make money the same

way as there are many ways in which applications can make money you know if you are not paying for something probably you are the product so probably those you know some of those uh chains if they will want to be free they will have to U somehow figure out how to monetize the users that they have how to sell user data you know user activity access to those users stuff like that and you know you say that there are so many so many rollups I saw more startups in waro alone in you know 2010 and some of them are still alive most are not and I think that the same

you know I'm not surprised with having 200 rollups I'm surprised if we will not have 2,000 troll UPS you know in 2026 I can give some more anecdotal examples as seen in arbitrium obviously yeah the initial uh sustainable Revenue uh generating Source was train Revenue but since then the Dow have voted to incept a lot of initiatives so one was to expand the opum expansion program so the a is the uh licensing model uh so if somebody chooses to deploy an orbit chain to a chain other than arbitrum as the parent chain then 10% of that Orbit's Revenue comes back to the arbitrum DA uh 8% of it to the treasury

and 2% to the developer Guild uh arbitrum DA has also experimented with the uh D diversification of its treasury into stable yield bearing assets so like tokenized treasury builds there was the stable treasury endowment program which is currently live with arbitrum where they decided to diversify 1% of its treasury um there's what else the gcp which is the gaming fund uh the proposal to invest 200 million in gaming which was alluded to I think in the last panel that's another way which arbitrum is looking to uh gain yield uh there's discussions about how to gain yield on the E sitting at the OB treasury uh there's some experiments around Venture

funds and also discussions around time boost so if approved by the Dow time boost would be an upgrade that lets users pay a priority fee to utilize an express lane so basically yeah being able to uh execute their transactions faster uh so these are some examples of how arbitrum da is currently looking at um yeah generating some alternative revenue streams yeah I I will say precisely uh one thing about you know the alternatives to to find some sort of uh Revenue aside of the you know the the typical user fees um I think that we have two different uh ways to think

about Revenue one of them is users itself buying buying for for their stuff and the other one is basically okay use the uh same infrastructure to you know to get to to get extra Revenue so I I have seen uh some people talking about you know uh uh alternative ways to do that by for example um take the user funds from the bridge to do some sort of you know defi strategy such as blast is doing today I believe uh do you think that this type of you know uh non-typical uh ways to to get Revenue

will will be uh the common standard or really we are still pushing so hard for the users to actually pay for their activity no uh funds in the bridges belong to the users whoever is having those conversations are really not thinking straight yeah so like I think that those conversations are inevitable and some some chains will do that but then you know that's how that's what I said that if you are you know if if you are free basically free then you have to figure out like how to monetize the the the users that you have this is a way of monetizing your users because you are actually monetizing you are adding the

risk to their asset simply to make profit out of the out of it and I think that I I totally agree with you like I would never vote to accept using users funds just you know just like that but I think that in the future we will have alternative bridges for example that will do that that will allow for bridging to the chain with the assets underneath being um being used in some def or staking or whatever um and sharing this profit with the users so they they get part of it but we have to understand that this is not like free this is actually we are getting money

for the increased risk especially um that this risk Stacks up and in case of failure the consequences are you know exponen go the consequences are going up exponentially so we should be careful about that and as R said like at least I hope that in arbit TR nobody is speaking about this seriously uh yeah yeah I mean we all saw what happened when certain Cent ized exchanges decided to use uses of funds and yeah really hope they not see that in the L2 space yeah uh I I will take this points to introduce the you know the the idea of uh security and rollups um I want to discuss a little

bit before to pass uh the opportunity to the public to to make some questions and the thing is security maybe the perception of security changed on the you know on the way of the markets evolves I mean uh is if the markets uh is is going up maybe the perception of Security is to say hey we could take more risk and this with this can can be you know the the this this can be translated to the perception of the community of the Dows um so my question is how to think uh Security in terms of when uh someone participates in

governance you know is some sort of stakeholder in in in whatever way um in term of don't forget that security is pretty important to for for the future of the Rolla because we we cannot add too much risk for because we are basically managing the blockchain so um who what what could be you know the the thing that we need to have in mind when participating governance and think about security too in order to make the best decisions over the time yeah I think obviously it's unfair to assume that all users should be technically competent enough to know the security implications

of Any Given especially technical proposal but I think it comes down to how the Dow decides to structure itself uh arbitrum now is moving to uh basically an organization of organization you know encompassing of uh working groups councils committees uh such as the arbitrum research and development committee which partly is there to help the arbitrum da better digest and understand any proposal uh especially technical ones uh doing like audits on the the the source code Etc um and yeah there's also the security Council in arbitrum so the Security Council is a uh Committee of 12 members of multi

who are able to uh execute any emergency transactions if there's a critical vulnerability in the system especially uh if it's time sensitive because obviously the governance process takes a while so Security Council have been given the power by the Dow to actually step in in these instances um so yeah I think it's understanding that not everyone's going to be Technical and uh deciding best how to elect uh the people in positions who are able to provide that uh contextual expertise knowledge and also to step in in case there is a Security emergency stage two are burst Chris

yes it's actually a bit more nuanced because like it depends on the case like not everyone uh not every not every use case is made for stage two rollups but basically you know for large scale chains I would say that yes like this is like the measure of security it's not just some kind of a trophy that you want to achieve it's simply the the measure of how secure your chain is and how secure are your users on your chain but speaking of security like adding to what what UD said uh like technical expertise is one thing but security is not just about technical expertise and how to make sure that we you know are mindful of security if you

have have your money on this chain if you you know if you are building a protocol on this chain or if you are building a product based on orbit or whatever else that you know if you are in this ecosystem you should probably also make sure that you have some stake in it and you can delegate it to someone who is actually mindful of security and especially if you know if you're are issuing a lot of funds on this chain then or like have people brid this chain your customers bridge to this chain let's say that you're are a traditional finance company that is building something on top of arbit room and you are you know selling this to your customers then you definitely should make sure that you have a voting power

and you delegate this voting power I either you handle it to yourself or you delegate it to someone who is not talking about using bried assets in defi for any for for or any other purpose yeah and I think just to add to that another thing that's often overlooked in terms of security is the governance system itself you know how do you design the governance system which is robust against governance attacks and takeovers uh it needs to be decentralized enough that it's capture resistant the quorums need to be high enough so that you know nobody has the feasible uh liquidity to buy up enough of the governance tokens to then vote in favor of a contentious proposal but then at the same time you can't have it too high where you have uh

like voter not voter fatigue but voter paralysis decision paralysis sorry where uh certain proposals you struggle to meet the Quorum because all of a sudden um it's unrealistic that you expect that many people to actually vote on a proposal so I don't fully agree with that because like I don't think that the you know the goal should be to to to make those uh systems in a in a way that does not allow for somebody to accumulate enough voting power to actually push the system in their own direction if they want to do it if they are willing to take the cost and the risk of doing that fair like that that's exactly why we designed token based voting systems that's why we have the governance and that's why governance tokens are valuable because somebody actually can do it if his Excellency for

example would like to buy enough ARP tokens in order to make arbitro you know Tron aligned then I don't see a reason why should we not allow him to do that like simply there is a price to it and if he's willing to take this price so be I expect actually in the future future you know right now the typical actors in our crypto systems are usually people like us or like whales or investors like but basically people from this industry but I expect soon enough that this will be large conglomerates or those large Usual Suspects from the tech World those you know microsofts ibms uh of the space because if Financial systems move to

crypto which I expect that it will happen then all those companies that are right now building traditional Finance they will be building on crypto rails and they they will for certain understand how the token based governance works and they will make sure that they have representation there our job is to make sure that our governance systems are ready for them to come in a way that like we at least require them to be transparent we at least require them to be open and available for discussion stuff like that but our systems are designed in a way for somebody to try to come and buy it yeah of course you can come in and buy it these are permissionless systems but it

comes down to kind of the the intent of what you're trying to do if you're proposing something that clearly goes against the Constitution um would you not consider that an attack against the Constitution yes however you know I've read the Constitution recently and it's kind of you know kind of open-ended in terms of what can be done like I we all probably know the compound case uh from a while back with humpy proposal and the question is was it a governance attack like I don't necessarily think that it was like obviously in this case it's a bit more complicated but I would expect such cases to be you know on a regular basis we had this with ape chain right AP chain had a vote of where should they

go with uh with their chain and uh arbitrum one at the end but polygon was pretty open in the way that that they bought actually ape tokens to vote in their favor and some people were upset about it and like for me this is exactly why we have those tokens they are this is exactly what supposed to be they are meant to exactly do this and I expect it to happen more more and more in the future yeah and I agree and I guess in that example if there was a conflict of interest policy in place then you could clearly Define that that maybe was file play but maybe yeah to your point considering that anyone can actually buy into these systems then the more important priority should be uh ensuring that the delegates are who are meant to

be voting are always active and that there are systems in play which always ensure that there is active redelegation so that the community is always delegating their voting power to delegates who will always be on top of things and if they're not then there should be a mechanism so that you know the voting power is healthily reallocated and actually this is not neither new nor you know unique for our systems like if you if you're wondering why you can drink Pepsi instead of Coca-Cola in pizzah Hut the reason is that Pepsi actually bought enough stake in the chain the company that owns pizzah head and some some other uh fast food chains to make them more aligned with Pepsi rather than Coca-Cola this is

exactly why we had capitalism and why we have those systems where you can actually buy yourself an alignment of uh another party with your goals well guys uh these has has been a very interesting discussion I think we are on time to uh give the opportunity for the public to make some question so yeah yes we have one here yeah um hi I'm Yan I'm a a security guy cyber security uh doing audits also um worked a while in the traditional Finance world and I think when I look at Dows One Challenge I see uh is like controlling the human part like in terms of security

operations so um basically what you see in traditional Finance institutions is basically you have a development uh laptop or PC and that is controlled some software is installed on there like you can't go on certain web pages la la la la la everything is super controlled at like what like devs actually can do and that eliminates a lot of attack vectors social engineering attacks and like a lot of other attack vectors and I wonder really how will Dows kind of be able will Dows be able to keep up with that and what are your your yeah thoughts on

that um that's a tricky one I think it slightly goes against the values of the space of course but I think at a social level yes so for example D could publish best practices on how multi should operate they could um launch best obsc practices they could have allow lists of service providers or or services or recommended wallets that you as a d member are recommended to use obviously there's no way to enforce that as far as I'm aware um but I suppose it comes more through the education yeah and I also think that simply we are early and we are heading the direction that you're

mentioning some you know some bodies in the D governance already do that for example you know some security councils already have quite high standard in terms of these you know human operations for example I know some arbitrum Security Council Members didn't come to Bangkok to not increase the risk of you know too many Security Council Members being at the same place so they are already mindful about it and I believe that with with time uh our operational procedures will evolve to ensure that more and more of such practices security practices and an OBS will be will be in place I totally expect I totally expect

it to be developing a lot in the coming years especially when as the value of those system grows any other question we have one here hey um a question I guess mainly for Kristoff but maybe also for the broader audience so um critical question so let me preface it with saying that I'm a huge fan of l2b and what you're doing both on you know the media SL resarch side and the governance side um nevertheless between those two areas I you know think there is a pretty strong conflict of interest um and curious how you think about that you know if you have already things in place to manage that um to deal with that or um you know uh looking into it yeah so that's a good

one I actually respond to it quite often uh I so I do agree I I recognize that there is a potential conflict of interest as for to and to give context we as alob are largest Delegate for example in optimism largest delegate in arbitrum largest delegate in scroll second largest delegate in zik sing and so on and so on and probably with time it might grow uh so one you know some could question okay if you are representing a Tobit in optimism aren't you doing something in favor of arbitrum because you are also there and my answer is like no I don't do it because like I have my own integrity and I am pretty open with this fact that I am present in

several different places therefore for some roles for example I'm probably not the best person like if some if something requires being like totally totally aligned with with one given ecosystem and only with that ecosystem then probably I'm not the right person to be elected for that Ro and I'm pretty open about that but also I don't believe that like I don't see there a conflict of interest because I don't see it as I don't see those Ro absolutely competing with each other I actually I'm proactively trying them not to compete because the enemy is not there like we if arbitrum or if optimism wins against

arbitrum and takes over arbit rooms users it doesn't matter in 10 years from now when like current industry is is Tiny so it doesn't matter if they win current users if they don't grow 10 times in the next two three years they will be irrelevant anyway so like comp the competition between rollups for me today kind of look like you know Samsung competing with with with Zs for who has the best phone and not realizing that apple is uh coming after them or I'm you know my background is in Linux and free software and I remember all those tribal World which

Linux distribution is better and you know is sare better no redot is better no Dean is better nobody cares today right like nobody even recognizes those names anymore and I believe that if those rollups if if our ecosystems don't realize that their goal is not to take over users of another ecosystem but actually to take over the world they will fail ultimately so like my goal is actually to make them aligned on the goal of expanding outside of our current crypto ecosystem and not fighting with each within each other we are to grow the pie not to turn this ecosystem in some kind of you know weird PVP Battle Royale kind of stuff uh because it makes

first of all it makes no sense and then it's like current industry is Tiny in in relation okay we have time for unfortunately the last question okay uh last question maybe can come here okay you go scream uh maybe you can take microphone thank you so I want to ask like uh you uh like the rollup infrastructure you are focusing on security and revenue both right so on the security side how how do you see uh you know adopting IG ler for uh

decentralized data availability Solutions because uh what I see that you know most of the rollups uh chains are still having centralized data availability and secondly uh when you talk about the revenue s uh like as a DA uh why why don't you look upon the uh price action of the token also when you when you already have a token because what I feel I was if if I simply give you some stats Solana versus arbitrum today right the volumes are at par right the the arbitrum is arbitrum is performing very well is at par with Solana but if you look at the market cap difference it's huge right so what is uh doesn't da as a community uh look upon

uh you know uh coming up with some new uh ideas for uh working on the price action side also for the token not really as I'm as as far as I'm aware uh JY thoughts on that we are thinking about it actually uh however you know we are running like we are playing a long game so you know about salana today having larger market cup yes they have larger market cup but they you know they took a sacrifice to get there uh I don't see that actually of an issue but in terms of price action in in arbitrum yes we are like the price basically talking about

price is a sensitive and delegate M matter and I've been advised to not discuss it publicly too much however what I can say is yes price of the token is super important because the token secures the system the token cannot go low because if the token if the token price is too low then the price for his Excellency to try to align arbitrum with Tron goes way lower than it is right now and we cannot allow for that so there are uh there is stuff that be that is being discussed for example how to introduce staking uh and uh with staking how to share uh some of the revenue that the da is generating with the token

holders so that they can have also you know they can get some value coming from the ecosystem but those all those discussions are I would say right now at the very early stages so I mean uh I also been into this industry since past 8 years and I've been investing into some crypto Web projects as well uh so uh what I have understood so far is that uh being an investor also what we consider is that you know when a project is coming for fundraising it's uh the product that they're pitching is the one product but the token that they're coming of is is the second product right and when as a Trader Community as well let's say if I look up from their lens uh most of the uh Trader Community

retail masses they look upon the price action so so Solana got hype because of the price action arbitrum was in a hype but eventually their hype kind of died just because of the bad price action so this is my view so that's why this was my question intended towards because I like that point where you said that yes revenues are important chains have to uh look upon earning more revenues to sustain so then obviously the price of the token also depends upon the security of the chain right at some point so that's why this question not I would say that security depends on the price uh price does not necessarily always reflect the the security uh but yeah like I totally

agree with that and we are mindful of that in the da as well uh at least I can say that like I actually published it on the Forum recently within this vision mission purpose uh thread that yes like I believe that one of the top priorities for the Dow is to figure out ways of securing the token price not for the token price itself but simply for the security of arbitrum because I cannot imagine arbitrum tvl going five times without arbitrum price going up because there like if it happens then suddenly you know 10 or like six billion dollar uh token is securing 100 billion in in in the bridge and it's risky so one

needs to go with the other and we need to figure out ways for doing that we are thinking about it definitely it's early at this point I hope we'll have some solutions by probably beginning of next year thank you well I think that that's it so thank you very much guys for um for attending this panel um thank you everyone for coming so keep enjoying the event go thank you guys thank you