1 week since merge, Coinbase announces Node & more - The Daily Gwei Refuel #453 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of The Daily refuel I recap the latest news in ethereum ecosystem I'm your host andreasana and has the 22nd of September 2022. alright everyone let's get into it so I do need to correct something from yesterday that I accidentally or I guess like didn't explain uh correctly and multiple people have uh have corrected me on this so it was about that uh I guess like uh lucky Staker website I talked about where I was talking about the chances that you have per validator to propose a block via different time intervals now I'm pretty sure listening back on it like I butchered the explanation of how kind of Statistics works and I was never very good at math so you'll forgive me for that but there was an explanation here from a slotted Pig on Twitter saying you know that's not how statistics work if

your chance of proposing a block within one day is 1.6 the chance of proposing a block within a year is 99.7 not over 100 uh you're falling for the gambler's fallacy and you know they're totally correct yeah I definitely screwed up by saying over 100 doesn't even make sense now that I hear myself saying it but you guys know I do these things unedited and I just kind of like said I must have not realized and then he you know they go on to say the math is one minus and in Brackets um one minus the chance of proposal by day uh to the power of number of days think of it this way the chance of rolling a six on a die is one in six but even if you roll it six times you are not guaranteed to have a six so proposing a block is basically rolling a

die with 430 000 a number of validator sides so that I think that's a great explanation uh and also I didn't point out that on the website luckystaker.com there's actually an average number of days to get end proposals section so it says here you know the average number of days to get one proposal is 60 days two proposals is 120 five proposals is 301 days and 25 proposals is 1 503 days now when it comes to statistics and probabilities obviously you can't have over 100 chance and you can't ever have a from my understanding uh get exactly to 100 you can approach 100 and get really close but it's never actually going to be a hundred percent and uh the it's always kind of been fascinating to me when looking at at probabilities of

things and I guess how especially when looking at probabilities of outcomes within markets and obviously gambling and things like that people do fall for that fallacy right where they think that they're just because they've played so long they have a greater chance of of winning uh when in reality your chance uh is is the same each time right but it just on average you take the average of it uh the chance goes up so so to speak hopefully I explained that right that that time correctly there but thanks to the people for correcting me on that don't just let me get away with these things guys like I should I I feel bad whenever I say something that's not accurate but uh I still think you know if you if you kind of like look at this and you do the naive math behind it as I

mentioned yesterday you can get rough numbers uh of of how long how many validators you would have to have to get a proposal um uh each day right to get a proposal of a block each day on one of those validators and I still believe it's the same the number that I suggest today which is 60 but do correct me on that if I'm getting that wrong there but I just wanted to point that out and correct myself before moving on to the rest of the stuff I'm from today which I'll do now so the ultrasound money account put out a little summary tweet of one week since the merge wow it's already been a week uh I know the price right now is uh is not great right to put it mildly um but like I have been like looking at it and being like ah whatever more

opportunity to to buy eth I don't really care what that what the price is doing obviously over the short term but it has been a week since the merge and this is the summary that ultrasound money put out you know there's been zero incidents there's been I mean it depends how you Define incident right because like there have been missed blocks uh due to Mev boost related bugs there have been obviously some participation rate fall off of like that two to three percent but we're back to normal now but there's been no critical incidents there's been no critical bugs everything has run smoothly we're finalizing it's all well and good so that's obviously a very positive sign there's currently 99.4 participation which is pretty much what we had pre-merge so you know we're basically back to normal obviously that

19 9.9 percent less electricity burned or less electricity usage that's been talked about to death eight times less issuance which I'm going to talk to in a sec 19 times less Supply growth and five consensus clients for execution clients with 8000 execution nodes and 18 billion dollars of Economic Security and that's the amount of each stake securing the beacon chain so all in all one week since the merge a lot of great starts to look at that but when I want to dive into because I know a lot of people have been talking about this recently especially with the price not going up post merge even though I think people got the wrong idea about that uh there's a tweet from antipro synthesis that shows this screenshot from the ultrasound money website and he captioned it by saying remember when you we told you that Heath would have a

triple hardening uh triple halving on the merge Well turns out it's only a triple harboring where compared to BTC it's more than a quadruple harboring where compared to eth before the merge and that's where the lowest fee burning years so this is including the fee burn this little chart here but you can see that before the merge it was 3.8 percent uh per year including the the the fee burn on bitcoin it's 1.72 for the the kind of like annual issuance there and currently on 8th even with the low lowest fee boom in years as Auntie says here at 0.21 and as I've mentioned before just because the fee Burns low now you have to take the average out you can't just take the average from like the you know a week right you have to take the average from a longer period of

time and over the longest period of time which is since 1559 in Inception uh we've been deflation here we have burned more Ethan we have issued under a proof of work regime as as well on some of those some of those kind of like days so you can kind of look at all of that and look at this chart and and see like wow okay well I mean there's hardly any Eve circulating the issuances dropped dramatically I mean obviously until withdrawals are enabled there's no new 8th entering circulation and then people will look at the price and be like why isn't that playing out on the price well there's two big reasons of this one is the fact of the matter that it's not just gonna happen overnight guys like it was never going to happen overnight there was always going to be volatility as I mentioned and there was a lot of

people betting on this kind of like sell the news event which seems to have played out and there's obviously all the macro stuff going on so right now it the just General market is is weak but just generally we haven't had that effect uh trickle down to the markets yet or maybe we have and we're not seeing yet because of Point number two which is that demand is basically non-existent right now we're at near zero demand and I've mentioned plenty of times how I think we're in the 2019 kind of period right now but what do you think is going to happen when demand comes back like as I've mentioned before Heath is going to trade lighter we're not going to have that demand eating through minor cell pressure for example there's not going to be any issue and cell pressure to eat through if that demand comes back within

the next six or 12 months it's literally just going to be the natural sellers which are people taking profits and Traders there's not going to be all that extra cell pressure that we had pre-merge so that will I mean it will like by fact it's not even an opinion it will make each trade lidar because like we can directly map the fact that there isn't going to be that extra eighth hitting the market right so how much demand will there be when the demand comes back I mean that obviously we don't know we have to wait and see and there'll be different periods of different demand levels but I I think based on the last bull market we can get a pretty good idea that if the market heats up again you know D5 is going to heat up again that'll bring more money in and then nfts will probably head up

again because of that it's kind of like this wealth effect from people who have eighth and have other crypto and they make money from that and then it trickles down to other things and then people make money from that and it becomes a circular thing and it can go on for quite a while and then you can bring in even more new money uh and and that's how kind of like a lot of the the bull markets in the past have gone so that can happen now also we have staking right people will there'll be demand for staking so if the demand is even like I mean if you if you consider the fact that we've dropped issuance by by over 90 if the demand is even 10 or 15 or 20 of what it was last bull market it then eighth will trade a lot lighter just

because of the fact the matter is that we have way less uh I I guess cell pressure for buyers to eat through just like on the way down you have uh buy pressure for sellers to eat through so you have to have more sellers than buyers so the price to go down it's the same on the way up like no one ever really talks about it on the way up for some reason but it's the same thing when you're going up you have to have more sellers than buyers to keep the price down and you know obviously hell press has talked about this this kind of like structural flows thing uh which is still very relevant I know how on Twitter recently said that it's kind of out of eth right now for for whatever reason but I don't think that invalidates his thesis which is that uh that those kind

of figures he put to it where it's like you have to find that extra cell pressure to eat through the buy pressure to keep the price from from going up and that wasn't a short-term thing that's a medium to long term thing and I think that it's still going to play out but we just have to wait until demand comes back which traditionally it's always come back but again I know we've we're in a kind of like macro bear market right now there are opinions everywhere we don't know how long this is going to last I don't know how long it's going to last but I think if you believe that the technology just ethereum but wider crypto has a use and has use cases and and will attract people over time and you know you believe that we'll deliver all the scaling things that are coming

we'll deliver on the ethereum roadmap then it's really really hard to not imagine a world where that demand comes back and then not just comes back but actually beats the previous demand that we've had and I obviously imagine that world I Envision that world coming but it could take a while like just it depends on how the world goes from here like just generally I've explained this before I mean I remember explaining this a long time ago when inflation started ticking up on the refill I said if inflation stays high no one's going to be buying assets like Ethan BTC and any other crypto because they're just not going to be able to afford to do that they're going to have higher bills they're going to have to take whatever spare money they have and put it towards paying those bills and that money that

would have gone into eth or other other crypto just isn't there anymore so when you have like this tightening of monetary policy as you've seen with the FED kind of raising rates and banks around the world raising rates and inflation being high uh it's very hard for risk assets to actually go up well that reverse eventually sure it will I mean based on the past 100 Years of data that we have or however many years of data we have uh there it does reverse but no one knows what that reversal point is it's a lagging thing as well the markets can actually start going up way before the the numbers reverse because as you guys know the inflation numbers only come out out once a month and it's a lagging thing and the FED seems to lag the inflation numbers by quite a while quite a bit as well so we

could literally see the markets price in a um a kind of like return to risk on six months in advance but you wouldn't know until down the line so that's why I guess like trading can be so difficult in times like this as well and obviously why I'm not a Trader but obviously as I said if you believe in the long term of ethereum of crypto to capture value to bring demand back to build applications that people actually want to use then uh you believe that that once that the man comes back it's going to be affected by those structural flow changes and that should lead to a a greatly increasing eat price at least that's my thesis on it but uh nice little chart that's on ultrasound money that you can go check out on their website as well uh it's a live chart and you can kind of do the

comparisons and and see the percentages for yourself all right so it looks like vitalik has been playing with one of these uh AI I guess art um tools called stable diffusion which has been getting a lot of attention lately and he's uh drawn one for Caspar so Casper is the name given to the consensus algorithm that powers proof of mistake ethereum uh and it doesn't really look like Casper right now but again this was done by an an AI based on a prompt this was not done by a human um I just wanted to highlight this because it's funny I think I can't remember exactly when vitalik called it Casper but it's been a long time now and it doesn't really get referred to as Casper anymore it's just proof of stake but as I mentioned before ethereum is proof of stake uh mechanism is actually

made up of two mechanisms it's made up of the consensus and uh and the kind of finality gadgets right so you have like it's called Gaspar you have the Casper the Friendly finality Gadget and Casper the consensus mechanism so those kind of parts make up the beacon chain and make out the proof of mistake ethereum that we all know and love so I just figured it was worth highlighting that it is called cast spa and it is named after Casper the Friendly Ghost obviously uh which this uh definitely does not look like but maybe we'll get closer to that maybe the target will keep trying all right so uh Danny Ryan put out a tweet today mark your calendars to tune in to a Twitter space about the merge data challenge this Thursday at 4pm at UTC uh that might be happening right now actually or it's Thursday for me and I

don't know what time it's in UTC right now um but this may have already happened by the time you watch this but you can definitely uh watch the recording for this and get all the details from from this tweet which I'll link in the YouTube description below for you uh and just another shout out here there was a live stream on Bank list with Tim baiko and Denny Ryan all about the merge uh so this was obviously done a week after the merge just to get a recap I haven't watched it yet but I'm sure it's amazing so I just wanted to highlight it for you guys in case you missed it that'll be linked in the YouTube description as well so a big announcement out of coinbase a cloud today so they have launched something called node and node gives developers free and instant blockchain

read write access starting with ethereum powerful data indexes Advanced and nft apis and soon much more so this is a competitor to inferior and Alchemy it's obviously centralized right but it is it is a competitor to inferior and Alchemy and maybe even the graph with that indexing tooling that they that they are having that they have here this is great even though it's centralized like it's it's another centralized RPC it doesn't matter I think the more centralized rpcs the better because then we obviously don't have to rely on on just one but as I've mentioned previously inferior wants to decentralize and I'm sure Alchemy is probably going to follow suit there I don't know if coinbase would do that but I think as long as we have lots of these rpcs out there if one starts kind of censoring or one starts falling over you

can just switch to another one so there is redundancy there as well obviously long term we want to see decentralized rpcs and we obviously want to see like clients as I discussed just today to make it a lot easier for people to basically be able to relay their own transactions without having to run their own full node which you can still do by the way and do it relatively easily just run it locally on your computer connect your metamask to your own RPC and now it's your own full note as an RPC and Away you go uh but still like most people aren't going to do that I am not naive to that I'm not someone with his head in the clouds thinking that every single person that ever uses ethereum is going to be spitting up their own RPC or anything like that right so the fact

that coinbase has just entered this game as another player is really really awesome so yeah yeah kudos to them for speeding themselves they've been killing it lately coinbase honestly they've been doing a lot of great stuff for the ecosystem I'm really loving their approach right now I know they've copped a lot of flack in the past for various different things but I I have to give credit where it's due and they've done you know obviously coinbase Cloud they were instrumental in the um in the uh what's it called the the beacon chain client diversity they really stepped up there and made sure they weren't using the super majority client anymore uh for most of their infrastructure uh they're prioritizing layer twos they're just doing a lot of great work I think and the coinbase wallet the mobile world that I've talked about as well they're doing a lot of

great work there too so just wanted to give a Kudos there uh but you can go check out node the sign up is now live I'll link it in the YouTube description below all right so the privacy and scaling Explorations uh team is sponsoring a dedicated round for grants for applications that integrate the semaphore Anonymous signaling protocol so you can go give get the details of this in this uh in this blog post here but it seems like with this grant round they are encouraging Builders to try out the tools uh such as some semaphore's zero knowledge Primitives uh and in real world applications that matter to your communities so this is obviously one for the developers out there uh there is a um a reason why they're doing this you know privacy matters uh semaphore as a privacy layer uh how it's working in

action right now with a bunch of different uh I guess proof of Concepts and a wish list of things that they want built so there's a how to apply section as well down the bottom for you to check out if you're a Dev it's definitely relevant to you and then FAQ as well so I'll link this in the YouTube description below as I said this is most relevant to devs but you can check this out as non-dev as well so an announcement from uh the mainnet conference uh and this comes from Microsoft research actually so they've published some scaling research that uh has a net net six times speed increase of evm execution now as you guys know the ethereum evm is extremely prevalent across uh the entire ecosystem not just within ethereum but within layer twos layer one side chains uh and they've they've actually tested this with live

ethereum mainnet transactions so it's based on real data not synthetic data and they've achieved a six times Improvement in execution time now there is a paper here that you can read if you want to get into the Nitty Gritty details it is about 18 Pages uh there's also this thread from your K Rhodes who works uh in the micro uh uh uh I believe works in the Microsoft research team uh and kind of explaining it as well here which is very very cool so what are the practical applications of this well I'm not sure what changes would be required under the hood to achieve this on the core protocol side of things but this even if there were changes that will required this doesn't have to just happen on the core protocol it can also happen on optimism and arbitrine because

they use uh the evm basically or use a derivative of the evm that this could potentially apply to and they could potentially integrate this same with the polygon PLS chain same with the other evm chains out there so it's very very cool to see that they've achieved a net net six times speed increase that's huge I think uh and you if you want the details of how they do that you can read the um the blog post of course uh but basically uh I'm wondering if there's a summary here because it kind of does get difficult to summarize these things uh apparently according to UK it doesn't uh doesn't require any changes to ethereum consensus and he's got a little paragraph here that explains it maybe I'll just read out the paragraph it says transaction execution is on the critical

path of creating the next block because it does the real work in the state machine to compute the resulting state of the current block which is needed for verifying the current block and for constructing the next block if this bottleneck can be alleviated the system can be configured to process more transaction within the same time window for each execution phase I.E the pack more Trends to pack more transactions into each block without increasing the block interval resulting in throughput increase note that this approach does not require any change to the consensus phase algorithm or require any or require increasing the latency or block interval so basically it seems the ldr is that they've been able to pack more transactions into uh into a block here using something called Forerunner which is in uh which they've kind of specified here as well uh which uh yeah they'd say

we have fully implemented Forerunner for ethereum and develops speculative program specialization on ethereum evm bytecode WE evaluated Forerunner as a node connector to the worldwide ethereal Network processing real time live traffic and this is a breakdown of how Forerunner Works uh here so you can go give this a read for more details uh I would be lying if I say I'm totally across this right now I have to read more myself to understand how they achieve this but it's coming from a legit Place obviously Microsoft research is is one of the most legit uh on places you can you can get this kind of research from uh and I haven't I don't know if I've seen anyone comment on this from the core Dev side of things uh but yeah I'll keep an eye on this and uh I'll let you guys know if there's any

other updates to this all right so uh speaking of Mev before there has there was a report that the blocks route Mev relay is failing to return signed blinded block uh which is causing mainnet validators to miss proposing blocks if you're using the blocks route Relay please be extra cautious discussions are happening in the block throughout Discord the issue got resolved shortly after and you can see the blocks route uh tweet here but what I think this speaks too and this is something that I've been talking about on the refill as well the Mev boost relays they're still early stage software and if you're running one that has bugs in it you're going to miss proposing a block uh if it has a a kind of a bug due to that and that means that you're going to miss out on uh potentially a lot of rewards personally

as I've said I don't plan to run any of these I mean to run Mev boost and talk to any of these relayers one because of these possible bugs but also two just I I don't feel comfortable doing it because I mean I'm a very big believer in eliminating as much Mev as possible so I don't really want to be an active participant in extracting Mev from the ecosystem system as well but that's that's more of a moral grounds it's more of an altruist ground which doesn't obviously lend itself to good Economic Security for a a blockchain so I don't expect most people to do that uh but that's just my kind of personal view on it but definitely the bugs thing is something that a rational economic actor that's not just doing things for altruistic reasons would care about especially if you're running a lot of

validators could you imagine if you're running like 100 validators and you're running Mev boost you would miss uh if I'm doing my probabilities right again you would miss on average one to two blocks uh a day if there was a bug there uh and that could be a big payout for you so obviously be cautious when running these different relays and running Mev boost but also speaking of Mev there was something posted here uh by the founder of xero mev.org and they've released something called xero Mev dot get which is a fork of Geth that helps avoid toxic Mev Builder centralization and censorship under Mev boost and the moral and legal Jeopardy of being bribed to front-run users and it still allows for non-toxic mov such

as back running now the way they've achieved this is a simple thing they're basically just ordering transactions by time and not gas so normally transactions are ordered by the obviously gas by the highest bidder but now they're just doing it by time I'm not convinced this actually helps and I'm actually more convinced this makes it worse because if you're ordering it by time you're basically rewarding the participants with the least amount of latency in the system and this is uh basically how high frequency trading works in the traditional system where people literally move their entire operations to as close as possible to The Exchange in order to shave like milliseconds off of the time that they have to execute trades and things like that just so that they're able to do I

guess Mev within the traditional space so I'm not really convinced that ordering by time instead of gas actually fixes anything uh so I don't know I mean it's up to you guys if you want to run this or not uh I wouldn't be running it anyway just because it's new software where and very definitely experimental but these claims here that they're making that just kind of wishy-washy to me doesn't really convince me too much and one thing I forgot to mention before about the Mev boost relays as well is that some of them are censoring uh certain transactions and there's no guarantee that the other ones won't censor either so you're literally giving up your own ability not to participate in censorship and handing that ability over to the relay who can or cannot participate in censorship just depending

how the relay is set up so that's another risk that of running Mev boost on your validators is that if you don't want to participate in censorship at all well you don't have a choice uh unless you stop running the Mev booth software because even if you pick a relay out that's not censoring right now there's no guarantee that they won't censor in the future so yeah okay you miss out on rewards and things like that but it's just up to you how you want to play it personally I care more about censorship resistance and making sure the ethereum network is as is as censorship resistant as possible than I do about making a few extra bucks right and I'm happy missing out on the rewards and I'm also I I also understand that we're trying to eliminate as much Mev as possible in the

longer term so this is just like a temporary thing hopefully that we have these things like uh like uh Mev boost and stuff like that and obviously it's it's mov boost is good for the ecosystem in terms of making nav less toxic but I don't think it's actually the solution I think the solution is eliminating as much mov as we can as possible and making it so that we don't have to run these kind of sidecar software in our Network that could potentially lead to things like censorship and other sorts of very toxic things generally so yeah but anyway you can check this out we'll link it in the YouTube description below all right so unisaw the unisoft foundation has announced their first wave of Grants uh here which I think is

1.8 million dollars yep of Grants was given out to a total of 14 uh grants which you can view below there's a bunch across a protocol growth um oh gosh Community growth and uh governance stewards stewardship stewardship there and you can check out all the projects in this blog post which I'll link in the YouTube description below but it's great to see that unisop is reinvesting that treasury that they have in projects within the ecosystem uh obviously some of these uh I guess Depot protocols have rather large treasuries because their native token is in there and the native token is worth quite a bunch especially uni so it's good to see them revent reinvest that now this is only the first wave there'll be more waves as as time goes on uh I think 1.8 million dollars is pretty healthy

especially considering a lot of these projects I believe are early stage so they're definitely not anything uh I mean some of them might be but like I think a lot of them are still very early stage haven't proven in product Market fit or proven their value add just yet with this money hopefully they'll be able to do that so you can go check out the blog post I'll link it in the YouTube description below alright so matcha DIY dydx zero X is a little a decentralized exchange aggregator here is now live on arbitrum so if you're a matcha user on mainnet and I believe matcha is also on a few other um a few other chains uh l2s like optimism and other and other layer ones but if you're a matchy user you can now use it on arbitrim I personally am a

matcha user I love the interface that they have it feels very very uh sleek and very web to like which I really like about it because it's got a because I think traditionally defy apps within ethereum have suffered from Bad UI and ux issues whereas matcha doesn't suffer from that at all in my opinion it does a really great job of uh being a decentralized exchange aggregator having everything there for you and offering you some of the best prices when trading so definitely go check it check match out if you haven't yet uh but the fact that they're live on arbitrary makes me excited because I've been using arbitra more and more lately actually is along with optimism um not on my public address but on my other addresses I've been doing a lot of things around around uh participating in arbitrim Odyssey when it was live and

participating in optimism quests and and stuff like that because I definitely just want to be part of that whole that whole thing that's going on and speaking of arbitrim Odyssey I wonder when they're going to re-enable that I um I don't believe it's been re-enabled unless I've been living under a rock and I missed that uh because I remember Nitro went live I think three weeks ago now so I'm wondering when they're going to re-enable that maybe maybe they'll wait till the the new month or whatever but anyway when they do you'll be able to trade on matcha since it's now live on arbitrim or you can trade on matcha right now if you're still losing arbitrim regardless of Odyssey so definitely go check that out all right last up here I just wanted to give a quick shout out to cryptocurrency jobs uh the newsletter here at

cryptocurrencyjobs.co I have shouted them out before but if you are looking for a job in crypto this is probably one of the best places to go to to find a job uh and the the person who runs it and you can follow them here on on Twitter Daniel he definitely is very very helpful I've heard multiple stories from multiple people that he's been very very helpful in helping them find a job as well if they've and and helping them narrow down their search so you could definitely go check it out and also subscribe to the newsletter so you can stay up to date with everything uh cryptocurrency jobs here so that link will be in the YouTube description below for you to uh check out there but I think that's going to be it for today so thank you everyone and for listening and

watching be sure to subscribe to the channel if you haven't yet give the video a thumbs up subscribe to newsletter join the Discord Channel and I'll catch you all tomorrow thanks everyone