2022 Mount Rushmore, 2023 Predictions | Blockworks Research

Transcript

all right everyone welcome back to another episode of zero X research the show is made possible thanks to our incredible sponsors chain Alice's and Flipside today is December 21st and we are recording a special uh episode here for you it is our year-end 2022 in review uh coming to you live with the blockworks research analyst team so we're joined here by the full team uh we got Sam myself Matt Xerox pibbles and Westy uh so we got a good episode for you we're going to kind of highlight some of our favorite moments in 2022 and as well as hit on some like you know still like outstanding and remaining controversial topics um that that are kind of like highlight you know where where are we at where we

are in in 2022 so exciting episode coming for at you today um let's uh kind of start things off here with a 2022 Mount Rushmore of crypto so let's try to do uh maybe like the fit your favorite moments your greatest moments uh of the year as a change the crypto it looks like snake draft this thing so uh Sam why don't you kick us off and then we'll wind all the way down to the team yeah for sure I'm gonna start with a pretty easy one and I've talked about it like probably the last three episodes but Starbucks Odyssey I am incredibly excited to to take part in the journeys earn some stamps I think these gen 1 stamps are actually going to be worth a lot of money uh once they get over to the secondary venues like open sea or one

planet um so yeah I'm super excited about it I go to Starbucks all the time I think every single company in web 2 is going to be watching it really closely because Starbucks is like the poster child for awards programs they have like one of the biggest most successful ones out there so very excited to partake in that event and uh yeah I'm looking to collect some stamps and hopefully win a trip to Costa Rica and see some coffee Farms it's funny you keep saying partake because pretty sure you mentioned this morning that you have not been accepted in the beta program yeah that's correct pibbles uh pibbles got in and I didn't even though I've probably spent like 500 bucks on Starbucks throughout 2022 at least so a little bit salty there bubbles yeah I got it it looks like a

lot of work so maybe I'll do it I just don't want to watch those videos and take tests The Cult of Starbucks is like as legit as the cult of board ape so I definitely think they're gonna have a [ __ ] ton of value too and uh something to keep an eye on and try to participate in if you can yeah it's definitely a good pick and I mean it goes to show the power of the ball the polygon BD team just one of like a million projects building on polygon uh this year um but yeah I guess I'm next um let's see how my first pick is the main characters of CT that were slain this year and I'm sure you could have sort of like a mini Rushmore within the Mount Rushmore of these characters but

yeah I mean the ones to highlight the first one I want to highlight is one that I think a lot of people forgot because of all the craziness that went on later in the year but the first one is Danielle sesta who was the founder of uh Wonderland time which was like the the Elm Fork that went crazy in 2021 as well as spell which is that CDP stable coin um and was pretty active in uh the Phantom ecosystem but yeah earlier this year it came out that he was pretty close to sifu who was pretty known criminal in the space um and yeah just left a lot of his projects and he pretty outspoken in 2021 and yeah we've we haven't heard from him in the past like 10 months or so

um so yeah and then the others were obviously dokwon who was probably one of the funniest Twitter accounts earlier this year like even if you hated the guy he had some great comebacks um but yeah he got a little too cocky and then obviously uh Tara had its death spiral um so that was another big one uh suzu unfortunately the super cycle did not happen um but yeah he was definitely a big voice um a big Chiller of all L ones and yeah he definitely got slain this year after three AC blew up and then yeah the final main character was obviously Sam bakeman freed who has been arrested uh over the past week so yeah just wanted to to highlight the main characters that are

no longer with us what do you guys think the odds are that one of those four uh villains that has been slained um actually has like a big presence on CT on an Anon do you think that's like likely or very unlikely Seafood is definitely still around I'm I'm almost 100 sure it would make total sense I still see him participating in rounds every once in a while um like and it's almost it's almost a bullish sign to some investors which is pretty crazy I'm sure and one person you didn't mention that I think is interesting and you know maybe not a villain but just like Andre Andre crony and uh you know he's gone so there's been a lot of people that just disappeared off CT this year and I'm sure they're still around on the nons like Sam was getting it well sifu is

actually still here he launched that radiant lending Ponzi made a ton of money off of that he's got his sifu vision token which represents claim on a treasury that he is bleeding out on and I think he's got one more grift project that is going to launch Omni chain and then you also have Andre who is back just scam pumping the lights out of phantom the past like month it's up almost like three times so they're still here Kibbles I think that brings it to you if you want to give your next Mount Rushmore face yeah one that left most of CT people really angry was the launch of

apecoin in like April May then you saw board Apes hit like 160 floor I mean they were all going for above six figures USD then he had the other side land mint they just kept winning and um I mean all we had to do was buy a bunch of board Apes chill out and we would have about traded literally everyone but I know none of us did that and then they finally launched the apecoin staking this month and then they hired the former CEO of Blizzard to lead Yuga Labs so those were all huge moments for like something that everyone hated

but also one of the biggest wins of the entire year yeah I know Matt and I have talked about this a few times like not even mad that I didn't get out on vayc but to not buy like an m a y c at like 0.5 e through one eighth however low they got that that was enough to actually piss me off like I should have known better we made the we made the same mistake over and over again you know faded board apes f2eath or whatever like was interested in buying one didn't buy one and as they went up you know skipped out and boarded Kennel Club came out muted napes like and we just kept skipping them and they kept going up and you know at some point it's just on us it's like skipping out on dog coins but uh I guess you could

call it due diligence true good point yeah I also agree like meyc was easily the I I saw that just right when it minted and you know it was like oh I should buy this then you start justifying like is this really worth you know a couple thousand dollars talk yourself out of it and talk yourself into immediate regret um but yeah no it's pretty hilarious you mentioned the other other side Deeds um that single mint has like ruined any transaction fee chart for the like the rest of time there was 227 million dollars of transactions fees on uh was it May 1st when these minted and that like has it's like 5x higher than any other day in history and it's just because of like how many people tried to Mint this at the exact same time just

totally blew out fees for for hours on end and then if you like ranked total transactions fees by block um you'd have to get into like the mid 300s before you get to a block that's not from May 1st because of this it's it's just like pure comedy what this did to uh each transaction fees but on on the flip side you know that that burned a [ __ ] ton of Heath that day and there's no doubt about it yeah I'm sure some people thought that they could get the same Returns on apecoin as you did the nfts and I mean that what it's high was 18 and now it's like three dollars and fifty cents so I'm sure some people got burned on that but yeah for the most part if you participated in the board

ecosystem you're up pretty big yeah I guess that brings it to me to go next and you know guys I don't know how we didn't hit this one first but come on the East merge that is forever ingrained in the you know etched in the side of the mountain for me um really can't understand understate the ossification uh that really ethereum as a whole went through but mostly focused on the economic side of things you know emissions are down like 90 percent from the proof of work model you know it's taken millions and millions probably approaching a billion dollars of cell pressure through blocker Awards off the market and that likely has a lot to do why we still haven't made no lower lows versus the June June numbers like something and when you compare to bitcoin that has made newer lows so

um you know it really is easy to to kind of like visualize what this has done for the the network um and really excited to kind of see that going forward and you know when we do resumable market and more youth is burned uh like where is that inflation going to to lie and like if you look at the last 30 days annualized right like 0.06 percent um annual inflation and I just think that's like crazy to visualize you know it wasn't super inflationary prior to this it was around like four to five percent um but like being net neutral on Supply as demand rapidly increases is a really exciting proposition yeah no question I don't even think it was just one of the biggest events of 2022 but probably one of the biggest events in crypto's history um is in the original white paper that

ethereum's supposed to prove for stake so watching actually you know achieve this Energy Efficiency achieve the goals that it set out become deflationary for periods of time it's really amazing and you know it's interesting to see it I forget I think it's paxos a crypto exchange today actually delisted ethereum saying that stating that proof of stake is not a valid way of securing a network it's centralized to there's two the power is in two people's too few people's hands um so even though you know personally I love I love to see ethereum achieve this Milestone it's kind of crazy to see that not everyone agrees with that so probably I guess I would say some Bitcoin Maxis don't agree with that to take a stronger stance I mean the biggest thing to me is just 1.4 billion dollars of cell pressure has

been taken off the market and that's stuff that the miners would sell because they need to sell in order to incur their their mining costs so yeah I mean that's that's the biggest thing for me when it comes to the merge which yeah I think we all agree is probably the biggest event in 2022 I guess it seems like a good time to take it to my next uh Mount Rushmore mine's actually negative so I'm gonna look at Bridge hacks as something that should be ingrained in stone because it's something that we should not forget there was three billion dollars billion and to put that in comparison that's pretty similar to the market cap of Cosmos atom token was stolen from D5 this year three billion dollars out of that 1.9 billion was from uh Bridge hacks specifically this data is thanks

to chain analysis and I just want to say like big shout out to them for being our sponsor and also something that I look towards regularly Jane analysis has this great report on crime in crypto within 2022 and I'm super excited for the one to come out in 2023 to learn more about you know specifically which Bridges were hacked like obviously I know BNB Ronin Harmony Just name a few but it's gonna be super interesting to see them break it down and do their on-chain analysis of that it's a big shout out to chain analysis and uh definitely should be ingrained in stone don't forget there is an inherent risk to using smart contracts and storing funds in D5 storing funds and bridges using this stuff so you know make sure you price that in I'm not saying that it's less of a risk than using centralized exchanges

just that that risk is there and should be noted yeah I strong agree here Matt I just think bridges in general are going to be one of those things that we look back on in five years and think I can't believe like we were actually doing that and I'm sure that's like a controversial take and that comes from a guy who is definitely a big supporter of like the L3 settling to the L2 down to the L1 and kind of removing Bridges like we had ZK sync on last week or the the week before and just kind of hearing their vision of hyper Bridges is something I'm super bullish on you have the op stack like I just think bridges are gonna fade away slowly and Matt I know you'd disagree with me there but that's definitely my take and yeah just to reaffirm your your

comments on chain analysis they're putting in incredible work like they're one of the best companies in the space like putting out tools that we actually need to like legitimize our industry so big shout out to them they also have like a lot of free research and courses on their website so we'll be sure to link to that in the show notes Matt you're at the end of the end of the list so we're snake drafting this one fire off another one so my next one is also negative and don't worry guys I have the rest of my Mount rushmore's as positive things that happened in 2022 but I have two positive and two negative um stored up I believe we're gonna do four maybe anyways tornado cash this is something again that we're should never forget it's had a huge effect on the industry how did those you know people

stealing money from D5 Bridges how do they get those funds to safety how did they clean it turn into Cash they probably use tornado cash for another mixer and while this is decentralized smart contract technology open source anyone can use it there's no owner or anything like that it's really sad but we've seen the dev Alexi he's actually still in jail I'm not sure how many months later call it four or five months later and it's really unfortunate um since then two-thirds of the total blocks proposed on the beacon chain have been censored meaning have not included transactions to or from tornado cash as it was sent as it was put on an o-fac list to you know not send funds to and it's just a huge a huge impact on our industry regulation is here it's not

regulation is coming it's here we're in the process of seeing it occur in real time and it's just something that I think is you know a huge milestone a huge impact on 2022 and something that should not be forgotten yeah definitely agree with you um yeah write it down everybody Matt from blockworks research wants to etch the bad parts of our industry into the side of the mountain forever but yeah I know like I would definitely like to think like code is speech and that you wouldn't get put in jail for something like this but the reality is you know the the there was billions of dollars washed through like North Korean hackers and like if that's the case if that is true like that's obviously going to piss off the United States government um so it's kind of like the unfortunate truth of the matter and you know it's

it's kind of yet to be seen what will be what will happen but you know it's in the it's in the government's hands and that will tend to be a slow moving wheel but to Pivot to the second one one of my favorite moments of 2022 for me personally was uh the launch of Kanto we were all watching that thing like a hawk and uh actually you know some of us were some like the first people to bridge over on chain like even before the dev team like we were that we're that early when that bridge contract launched that we were the first ones jumping over there there and nothing will uh you know I I think we all have the similar feelings here but like just blasting those funds over there you're like there's no way we get any of this back and sure enough kanta's still kicking

um so yeah I would love to hear if any of y'all have similar thoughts on that yeah Kanto was awesome seeing the the devs slowly add liquidity to the pool before they tweeted about the launch and no one was supposed to be over there and there was like 5K in the pool and uh watching it go from like three cents and then like it peaked to like 80 cents like a couple weeks later pretty euphoric great chain Great Tech I'll be back yeah I Canto believe Westy top take that chart twice so if we were doing hot seat cool Throne I'd be throwing you in there Westy on the cool throne yeah it's definitely my best trade of

the Year probably the only positive trade I had this year but appreciate it Pebbles you're up next okay my next uh my next Mount Rushmore moment is Solana and the The Saga phone and xnft backpack and we didn't actually see any of this launch yet but just the announcement of like a crypto native phone that's gonna be like I think it sold out it was like a thousand dollars uh I think it's a big step forward for the entire ecosystem like being able to play uh Salon the native game like a Rory or something on an app on its own operating system on a phone that has like Phantom wallet built into it is a

huge step forward and I just think it's a really creative way to push crypto forward on top of that they also implemented priority fees and had a hard fork in June so the the devs actually did something and the network is functioning now so it'll be super interesting to see how Solana moves forward from here yeah on the Solano phone I mean looking at how Apple's treated like crypto nfts I know they they basically tried to make coinbase wallet like any users of it that are buying nfts to pay the like 30 fee that they usually charge on gas fees which is impossible and I think it shows

that either like they don't understand crypto or that they do understand it and and don't want it and so it's good to have an alternative that won't sort of push their their agenda or to try and take a cut of fees and to allow like pure decentralization to happen and so I think we sort of need that competition from the normal app Apple and Android that we use today yeah I like the vision but to be honest I think it's dead in the water as soon as it launches so I'll take the other side of that one definitely excited to see it moving forward though um I guess I just uh don't believe in a a web 3 company's ability to actually manufacture a phone at scale and

establish like Network effects like Android and Apple have so it's an uphill battle but I definitely like respect the hell out of Anatoly and the rest of the Solana foundation for giving it a shot yeah I definitely hear you I think there were only like a couple thousand people that were still on a phone or pre-ordered so yeah I don't adoption is going to be really tough but I'm just glad that they're at least trying it um but yeah for for my next pick I have Layer Two adoption um which yeah I was really shocked to see just how much they were adopted this year despite the bear Market I mean if you look at transaction fees and active addresses they've basically been up and to the right despite just as a whole crypto being less used and I'm talking

specifically about arbitrum and optimism which I think combined have like 96 of the market share of TBL um but yeah they've been doing extremely well um and yeah I'm excited to see in 2023 how they evolve like both of those networks as well as the new Roll-Ups we get um but yeah I'm just shocked at how well they've done in even the specific applications like GMX on arbitrum um that I've done really well this year yeah I think L2 adoption has come a long way since the launch of arbitrim when people were bridging over there and the only option was to wait seven days to get your funds back off of it and we all just formed arbinion which was just like

the neon cat and it was just your Classic on chain Ponzi and now they actually have real users and real dabs so super cool to watch that mature I remember saying at the end of 2021 that I thought ltus were the sleeper of 2021 were the most Dev development was happening but you know it wasn't really getting narrative or a lot of attention and I think we definitely did see that come true in 2022 where everyone hopped on board and I gotta say it's still probably the thing I'm most excited about in 2023 to see even more adoption to see even more development so yeah huge shout out to l2s and can't wait to see what happens in 2023 and if you want to learn more about l2s we have a great dashboard built by Westie himself on

Dune check it out blockworks research Dune account yeah Sean agree on that point Westy I think lt's have been one of the most exciting things and it's crazy to think that even in 2023 you still have so many tokens for l2s to launch that it's hard to believe that it's not going to just continue to snowball I guess like what I'm really curious about in 2023 is if optimistic Roll-Ups considering that they have outsourced like third party bridges that can like get rid of that seven day withdrawal period if the user actually cares is to use ZK Roll-Ups versus optimistic Roll-Ups like you know you saw polygon get so much great adoption even though there was other evm chains that got spun up like I could easily see the same thing happening with you know optimism and

arbitrum where they kind of maintain their their first mover Advantage so that's definitely something I'm going to be looking out for in 2023 but if I'm going on to my next uh Mount Rushmore face that I want to carve in it's honestly just defy and in order to kind of streamline this I'll I'll just hand it over to uh Westy to give his other Mount Rushmore face because I know we're all going to agree on this point but I just think it's really cool to see projects like Thor chain we just had chat on you know last week and they're providing like Savers vaults you know native asset swaps similar to a sex you've got margin indexes like GMX and gns like there's just so many tools that people can actually use to effectively

trade with leverage spot Etc that I just think d5's come a long way despite the bear market and I think that's just going to continue up and to the right going forward over to USD Sam I think you got you got one more pick since we're doing a snake draft here ah you're right you're right okay so for my second pick and this is actually ironic because I just talked about how optimistic Roll-Ups might continue to to see a lot of adoption despite ZK EVMS and stuff coming online um I would go with ZK Tech advancements I mean we have Aztec who is basically enabling uh privacy and defy and they even raised 100 million dollars

throughout the bear Market you've got ZK sync rolling out a 200 million dollar raise in the middle of a bear Market as they work on their ZK AVM you got polygons EK VM you've got scroll Taiko Etc the cost and Hardware requirements to to run approval are going down while proof generation speeds are actually improving and then Stark X was massively massively successful with dydx and immutable X like I I think it was vitalik who said I thought this stuff was going to take three four five more years and like it's advancing at such a rapid pace so that's definitely what I want to carve in the the side of the Mountain here for for 2022 I think it's kind of like a turning point so really excited to watch it going forward and uh

yeah I think it's just going to continue to to pick up pace yeah strong agree on that one definitely excited for the CK evm specifically like you said you're not sure if um they'll be able to steal market share from optimism and Arboretum as first movers but if they have the evm implemented uh then maybe the same applications can Port over and so you do see the same adoption but yeah definitely excited about those but yeah my next pick is MVP boost which was essentially flashbot's upgrade through proof of stake where they changed MVP gets to Mev boost and it's been really cool to see a lot of people look into the data and actually care about the Mev being extracted and looking at the sort

of markets being created between Builders relays validators Etc and actually caring about sort of the the censorship going on and I know the first episode of his hero X research I was on to talk about Mev boost and basically explain what it was and how it works and to look at the data and there's a lot of concerns around censorship at the time especially since 80 of the blocks went through flashbots relay but at this point especially the Builder's Market has become way more um like competitive with more Builders Beyond just flashbots building high value blocks and getting those included so we're seeing in real

time the the censorship resistance of the ethereum-based layer getting better over time so yeah it's been really cool to see over 2022 just that implementation and then seeing people iterate and get better over time it's pretty wild that you know crypto is now this industry that's well known among everyone you know we're on the front cover of the New York Times and Wall Street Journal in the past month but Mev is a multi like I'm not sure exactly what the numbers are but multi-millions if not tens of millions a month in value being extracted that's still not really on the Public's radar I don't think obviously we all spend a lot of time looking at Mev and the participants in the that are you know both extracting it

helping mitigate it or helping make it more efficient send it back to you know ethereum holders whatever it might be but I think that that's still just an under looked at Space by the general public and you know outside of the small niche of maybe a couple hundred or thousand people yeah even like forget about the public even like within crypto right it's still like such a technical field um you have to really understand how the chain operates uh how to communicate with a blockchain and how to be faster than other people at communicating with the blockchain in many in many cases so it is even like like such a deep and uh technical area where like even new research is still coming out then you have Concepts like cross chain mov like what will that look

like um and so yeah like it's such an expanding place and I agree Matt I feel like there's a lot of opportunity if I was a builder that's probably where I would be spending my time looking Pebbles is your next face my next face for Mount Rushmore and this is kind of a two-tiered one is Moon birds and limit break slash Digi daigaku the the biggest thing about these where it was two two different Founders from you know more traditional web 2 companies coming into crypto and launching projects that were either successful or temporarily successful like you saw Moon Birds which was a public raffle and you could mint

it for two weeks back when it was like three thousand dollars a pop and um you saw I don't know who the hell was buying Moon Birds but you see Ryan Carson launched this project and then at one point the floor was like 32 East per moon bird and the project had amassed like a billion dollar valuation almost like I think probably within like the first two or three weeks so that was a pretty big step just for crypto as an industry that someone sees potential and comes in here and launches something so big and people are willing to bet on it now Moon Birds aren't doing so hot I think they're at like 74 but it was a

cool temporary burn and then you also have Gabriel laid on with limit break which raised 200 million dollars to build some sort of gaming application on crypto and the biggest thing there is that the nfts were free to Mint the digi digakus and they basically went from free to I want to say like thirty forty thousand dollars to pop so he also started diluting the um that Genesis holders via airdrops but I mean they just kept winning with those like I think Genesis holders have received like maybe like eight air drops and like a total Digi set is somewhere like in the upper five figures I would say we still

haven't even seen a game come out of limit break but I mean the guy built Game of War which was super successful in iOS back in the day and she's also doing a free mint on a Super Bowl commercial coming up next year so that's just another example of someone betting bigly on crypto and really putting their money where their mouth is I don't know about you guys but I'm already nervous for that Super Bowl commercial last year was like the coinbase one was the big one with the QR code that bounced around the screen like super easy to understand this year Gabriel's gonna do something interesting I don't know it's gonna have something to do with Wafers and I'm gonna have to

explain those to my friends and I I don't know man I'm nervous I'm not gonna lie I remember that coinbase I had all my friends because like that was you know still kind of peak Bull Run territory we're going like oh my gosh pull out your phones pull out your phones free free crypto like I can only imagine what this year is gonna bring what a way that would be to like to download some malicious software random thought but if you put in a QR code on a screen that everybody's watching everyone's scanning that [ __ ] but I guess this kind of brings it to me for the next one so uh next face I'm etching in is institutional adoption that was a big one uh you know I feel like that's been the narrative right

like everyone's been at Paul Revere the institutions are coming the institutions are coming but uh this year it feels like we actually kind of saw that so Sam already mentioned Starbucks but even things on like the more financial side as well right like uh JP Morgan launched forked and launched a protocol on to polygon and like they came out and said this and like you know talked about it and we're like bragging about it we were happy that they did this um so that's that's like this huge shift in sentiment that we've seen especially coming from a large Investment Bank like that um we've seen another narrative kind of like funds in the forums right so you see uh golden tree or they're crypto uh divisions called like golden chain uh huge activist investors in sushi and you see like a16z really pushing through and

like they're always putting in uh comments in the maker now uh forums and you really see that this like shift in an investment style is like buy liquid tokens and try to like push your your thoughts and beliefs in into the ecosystem and for like newer protocols that can be really beneficial like maybe they need these like figureheads or leaders that can kind of like you know push for positive change so it's pretty interesting to see not only like large web 2 companies but also Banks and investment based companies as well like investment firms really kind of push into this industry huge degree and like you said not just institutions Fortune 500 companies are here too we're seeing Instagram and Twitter both support nfts Instagrams

even using our weave like a pretty low cap Lo not very well known decentralized data storage provider a little shell we just came out with a report on them but you know it's really crazy to see it's not that the institutions are coming anymore the institutions are here Fortune 500 companies are here everyone has an eye on the industry Wall Street journals writing about us New York Times is writing about us it's not small it's not we're not left out we're not Niche we're you know this is a real industry everyone's watching the biggest thing for me was when JP Morgan after the the sdx collapse very quickly said this was the fault of central centralization centralized institutions not defy which was really interesting coming from a big Bank

um yeah that was that was the biggest thing for me to show okay the institutions are on board and they see what's going on here Dan's Mount Rushmore wall right now is vitalik with the merge the people of Republic of Kanto and then Jamie Diamond of JP Morgan that is quite the collection he got going so far nah we're taking Jamie Diamond down and we're putting up um shoot what's JP Morgan's crypto arm they have a name for it but Jamie Diamond has has said too many negative things we're putting up JP Morgan's crypto arm all right my last two picks from you my last two picks are gonna be app chains and better tokenomics um for app chains yes I want to shout

out Cosmo specifically we're seeing dydx move there which is by far the most successful application decentralized application on a layer two uh we're seeing Circle create native usdc in the ecosystem but even more than just Cosmo specifically I'm giving application specific blockchains a huge shout out here I think that we're seeing Builders find Value in controlling the whole Tech stack and whether or not that's going to end up in you know I think that we will see that continue for the foreseeable future I hope that Cosmos is where they decide to build in the cosmos SDK with IBC compatible chains but at the same time you know Avalanche is actually releasing subnet communication soon who knows for all we know maybe polka dot

somehow could make it come back and become relevant again but I just want to give app chains a huge shout out and then real yields better tokenomics actually no not really yield better tokenomics you know ethereum just moved from basically a mechanism of value accrual where you were only hoping that people were going to want to stockpile it to use it in the network all ethereum that was being paid that was being sent to the network before it yet b1559 a year and a little year and a half ago or whatever it was it was going right back into the ecosystem you know it was going to minors miners were selling it there was nothing taking ethereum out of the out of the ecosystem besides speculators and those stockpiling it to use but that's not a great value proposition when you really think about it

especially when you compare it to the burning mechanism that it now has uh you know it's just incomparable it's literally a deflationary network at times um and Def sorry deflationary token at times we're seeing the same thing with this real yield narrative where you know people aren't just okay with some random buy and burn mechanism or something like that they want actual stable coins coming back to them for holding and for holding an asset so better tokenomics 2022 is the year for it think developers got a little less worried about you know maybe the SEC coming after them or they were better be being anonymous or whatever it might have been but better tokenomics are definitely going on my wall yeah I agree with both of those and I want to hit on the app chain one uh first but before we

do that did I just hear a polka dot shutout what's next Ripple and cardano we might have to duck there's probably some hot comments coming for me after that but um yeah on the app chain thesis I have a question for you guys and maybe this is uh directed mostly at Sam and Westy because I know you guys are the the LT L3 view Maxis um but okay so the opportunity this makes a ton of sense to me it broadens the design space for developers by including the validator set within the design space um what is the difference between like the cosmos vision of a series of Monolithic l1s that are connected via a communication protocol in the case of Cosmos IVC versus like multiple ZK EVMS that have L3 ecosystems built on top of

them but that like for that to work like right there has to be that one piece of standardized uh code between them all and that gives them the interoperability to communicate with the hyper Bridges um but if that one piece never gets standardized don't we just have a series of L3 ecosystems that have no cross-chain communication between the ecosystems but they do within their own respective ecosystems like what is the difference between that Vision where the piece of code never gets standardized and the cosmos vision so for me personally I don't think there is too much difference I think we're probably on the same page and I think we're we've been talking past each other uh when we have these discussions but yeah I think a lot of the vision is

pretty much the same and I do think like IBC is a great way to communicate between blockchains and I think like if we see app chains um do well on sort of an L2 and L3 environment it's going to look pretty similar to Cosmos the thing that is the difference for me is that I don't quite see how the app chains on Cosmos have plans to scale um Beyond just their like monolithic chains themselves and so when you have L2 and l3s you have the ability to scale to to billions of users if you wanted to um whereas Cosmos like each chain sort of has to have their own vision of scaling and then it becomes extremely complicated as each chain sort of

chooses their own way to scale and still has to connect to IBC and they're sort of a web of complexity there whereas with l3s it's sort of pretty simple that you're all connected to the same circuit and how all are essentially l2s and l3s like it's pretty pretty simple and pretty clear whereas the cosmos road map can get pretty complex but overall I think it's a pretty pretty similar Vision that like things are better when you have application specific blockchains because you can have customization for your specific use case but at the same time implementing some way to communicate with other application specific chains and set assets from one to the other so yeah

it's pretty similar yep I would agree with everything Westy said um with the one caveat of do you want to be secured by a bunch of fragmented validator sets with minimal market cap tokens or eth the deflationary asset that everyone wants to hold use like I don't know I just personally think there's no question in my opinion but uh we'll see how it plays out yeah I know those are great responses and um yeah no I agree like the monetary premium that eth has the potential to accrue is pretty staggering when you see the number of individual wallets using it each month and uh you know there's like 30 some odd million transactions that happen each month and it's just like interesting just think about you

know how much money people are really willing to pay to execute ethereum transactions it's it's exciting honestly uh but I guess that brings me to my last fourth and final Mount Rushmore um and honestly I'm gonna go crypto data tools here uh we've seen a huge uh increase in the data availability uh and it's just super exciting for me to see right so if you think about like D5 llama they have done such a great job of making broader Market data available for free and do a very great job about being as accurate as possible they're super responsive so when things aren't accurate they're quick to update it which is just so exciting to see and then you see things like nanson and Arkham intelligence like really pushing the barrier on wallet tracking um and and that sort of whole side of

the thing and like actually tracking more on-chain transactions and then lastly you have two Proto or two companies like Flipside and dune that are making the actual raw blockchain data available to analysts or anyone um and in some cases for free and that's just like super exciting to see huge fan of what they're doing and that like really gives the Credence to the to the whole notion of you know the revolution will not be quarterly reported like we actually now have the ability to track the health and profitability of every protocol that we all know and love on a block to block basis and that is super super exciting to me yeah man wait till you see what we're building with it redacted pebble's what you got this is my final face of Mount Rushmore I think

it's going to be layer zero labs and the launch of Stargate that was a crazy moment earlier this year and I think it like it happens right when the market had a little rally after everyone was scared treadless for a little while so just seeing people be able to buy Stargate for like I don't know it was like 50 60 cents and then watching it like go like five times um it was pretty euphoric it was a lot of people's make it all back trade um and then also just the launch of layer zero Labs itself was kind of a game changer to bridge infrastructure and like we don't have a

layer zero Network yet but just the idea of having Omni chain daps and omnichine liquidity is just a totally new paradigm for everyone's experience on the blockchain so looking forward to what they're gonna do in 2023 and how this just improves every experience possible yeah I'm look I've been spending a lot of time looking at dabs building on top of Stargate and the idea of cross-chain communication and cross-chain fund transfers which is what liar zero and Stargate respectively offer is just absolutely amazing whether you're looking at rage trade where you can use collateral from any pro from many protocols across many

different chains or whether you're looking at Sushi X swap which is lets you swap assets across chains for instance you go straight from GMX on arbitrum to ethony's mainnet it's just really cool to see and this is all brand new and also like layer Zero's investment round is one of the craziest I've ever seen just the the names every single fun that you've ever heard of pretty much in crypto is is on that is on that Gap is on that cap sheet cap table so pretty pretty cool to see when LZ token that's the real question I think one of the most interesting things with layer 0 is that they had built this like great concept that really opens the door to decentralization um with their Oracle and they have like

basically like a two Oracle model where like there's two systems that verify everything um and if one system fails then the transaction will fail but like currently it's still pretty centralized just because the system's built on each Oracle are centralized but uh that'll likely be abstracted away going forward it's just a question of when um you know in the depths of a bear Market that's probably not a priority but um exciting to see them you know hopeful to see them like continue building towards decentralization as that's all obviously I should really be at the Forefront of their priority list yeah so for my my last pick I have pseudo season with pseudo swap I don't know about you guys but probably the funnest time of this year besides top

taking Kanto was participating in pseudo swap when I was pseudo season I think this was what early August uh when people were going crazy um basically buying any mints that was happening on pseudo Swap and selling it after it pumped for a few days and yeah I think we haven't talked about sudo in a while but it really is one of those Innovations allowing essentially for an amm for liquidity for nfts and I think it'll still Thrive for certain nfts like we said that are more fungible that aren't really one of one pieces but are sort of meant for more volume and more trading and so I hope we get another pseudo season Once uh we get a bull run back because that was definitely fun

um but yeah definitely had to to go on my Mount Rushmore for this year our slack chat was popping off during that season I remember I built this that was like one of the first like uh more complicated SQL scripts I wrote which was to attract the pseudo Factory pool to see which New Pools were launching I guess in hindsight it would have been a lot easier just to set uh turn on etherscan notifications but that was that was such a fun time swap one of the biggest things about pseudo swap for nfts was the fact that like royalties didn't have to get paid anymore that was like kind of the tip of the iceberg for the whole nft debate

that those guys are fighting over on Twitter every day I mean it was just awesome to like buy something and not have to immediately give out like 10 of my profits just for selling it yeah I totally forgot that pseudo swap was really the start of the whole you know royalty debate and that was you know the big part of 2022 as well can nfts have royalties as it's is it a sustainable model for nfg creators um you know what are what are ways that creators can maybe mitigate people not paying the royalties and just something that was an interesting conversation throughout the last six months yeah for my last face on the the side of the mountain here I'm going with uh controversial one I go with dokwon uh I

honestly think it's really good that UST failed to be honest I think it washed out like a lot of Leverage that could have stuck around and survived the bear Market had it not um you know starting with 3ac then going over to Celsius then going over to FTX and Alameda and then Genesis and dcg so I'm glad that it happened I also don't think dokwon had bad intentions and that's the controversial part I think that he was just trying to build something that was a little bit actually not even just a little bit really like way too early like I think eventually there could be an algo stable that people Trust and Believe in and aren't always like looking over their back to think when do I need to cash out of this thing because everyone else is going to bank run at the same time you know maybe

that future is like 20 30 years down the line but I do admire the idea of decentralized money and I think it just was ahead of its time but I do think we'll see the Resurgence of that narrative way down the line when it becomes more needed and more imperative to to the functioning of defy yeah I don't know about I'll go stable specifically maybe something like frax that has part of it being algorithmic but I do agree that decentralized stable coins especially like this year that censorship is such a big narrative towards the end of the year with tornado cash and Med boost I think yeah it's definitely going to be a narrative within the next few years is how do we actually build it to centralize the

upper coin that is scalable and Tara was the the best attempt at that so far but obviously the model wasn't robust enough to survive a big bank run like it had um so yeah I think while right now people listening I think are still sort of weary about decentralized stable coins eventually it's going to come back and we're going to have people smarter people building better models for that decentralized future yeah I guess the reality is it worked as intended right like ustd pegged Luna was sold to backstop the peg um I guess you could argue it didn't work really because I don't even think it still restored the peg yet somehow

um it's still like the third largest decentralized stable coin which is kind of interesting um but yeah no nonetheless I think that's a pretty solid recap of the Mount Rushmore events you know we hit like the the highs and even the lows sponsored by Matt's uh Matt's depressing Mount Rushmore but uh I think net net I think we really hit the major events in crypto so it's really exciting to see that you know I feel like we've come a long way this year and it was pretty exciting but if we start pushing into uh the next portion of the episode which we're going to kind of do a our usual flip side Dash review um you know this time we're actually not going to review a dashboard but rather just one chart and just kind of follows up from last week's episode where we had

Chad Barefoot on talking about the Savers vaults that the network has launched um again recording this episode on December 21st so this is the most recent data as of just a few blocks ago when I updated this script uh powered by Flipside um that's a quick shout out to Flipside for again I feel like we keep showing a different part of their product every day but uh their API is so damn easy to use you literally just plug that thing straight into your uh python script boom data's in no work needed it's pretty nice to use like an effortless API like that but if we look at the chart here we have a an analysis of Thor chains synth utilization and if we remember from last

week's episode since early the backbone of the Savers program and the Savers were launching around early November which is very obvious when you look at this chart like where this massive Spike comes in smashes the new highs by about a hundred percent and pushes up towards that synth utilization cap of 30 and if you see here at the very end of this chart we actually are poking over the utilization cap and why that's possible is because once the 30 percent is hit then no new synths can be minted but if the balance of the pool shifts a little bit then you can kind of like push a little bit over that 30 percent but uh again when when utilization is over 30 then no new synths can be minted uh so this is like a clear definition of

product Market fit in my mind you know if there's over a thousand unique Savers in the vault there's some around seven million dollars that have been put in these vaults of course bitcoin's the most popular but ethers as well and it's just really exciting to see uh like a new innovation get immediately adopted like this Dan with the low-key Flex saying I just updated this chart while we were all talking I love it no that's great I was hoping you wouldn't pick up on that but yeah no uh as always you know we do I feel like you know flip side to sponsor this podcast but it is true like I use it every day I'm obsessed with it their data is great they do a very good job of qaing the the data within their tables and if you want to get started on on

querying some of this data yourself and learning how to do that they have some of the most comprehensive on-chain data there is in the industry so definitely check it out best part about about it is it's all free you get full access to their entire product without having to pay for anything and if you want to kind of like maybe answer a question or trying to start pushing in a certain direction then definitely be sure to check out the flip side Link in our show notes we've got a little challenge for you to earn some usdc for yourself so just check out this bounty and again you have the opportunity to play with some on-chain data yourself all right now going into the next segment here we've got some topics we want to just kind of banter about um first up death of all L ones what do

you guys think yeah I think it's pretty interesting to see the contrast on sort of the multi-chain thesis from 2021 to 2022 I know even towards the end of 2021 it seemed like to everyone in the industry is pretty obvious that we're going to have a multi-train future with multiple monolithic l1s but obviously after the events of 2021 were I guess sort of the specific l1's they got adoption in 2021 um sort of got burned so you had Tara which is one of the biggest L ones and then you had the USD death spiral you had Solana which was heavily backed by ahmeda and FTX um as well as the network going down a

few times um in low sentiment there and then Avalanche 3ac was one of the biggest bidders and shillers of avax and when they got wiped out there's no one really left to be loud and bullish on the ecosystem um and you look at sort of the their native tokens versus eth and they're down I think each of those is down like 90 with Luna down 99.9999 uh with eth down like I think 67 um so it goes to show that I guess eth is outperforming and maybe yeah the L1 thesis is dead and like we talked about earlier

um l2s had a lot of adoption this year like uh gas was up into the right transactions up to the right whereas these all l1s all had their their transactions their activity basically down into the right um towards zero and so yeah it definitely brings up the question is the all L1 thesis dead I know we saw Aptos which was um pretty pretty highly funded and that launched towards the end of this year and we haven't really seen anything come of it yet which you would have expected if the L1 thesis was in hacked but yeah I wonder if you guys have thoughts as well so let me let me take the other side of

that um a month ago I totally a hundred what I said 100 confidence you know I would have said it to anyone like L ones are dead all all L ones are dead you know ethereum is going to be the winner then I started to think about it a little bit and I was like okay well normally when I feel that strongly about something I need to take a step back and really really analyze it and secondly who are the sellers left right you already saw SPF blow up sure that was the biggest proponent of uh Solana and 3ac was the biggest proponent of avalanche but they're gone they're washed from the ecosystem so you know are there really more Sellers and then I guess another thing would be there needs to be multiple different places for different types of projects to go when they're developing and I think that

that's kind of something that we're going to see for a long time where maybe if you're a gaming chain you're gonna go one place or if you're a D5 chain you're probably on ethereum but whatever I think that there's a possibility where these l1s do succeed so just taking a step back like I'm gonna fade myself and uh say that all l1s probably will come back although not to the same extent and I do think that Vance Specter uh had this had this theory that they were just super inflated where like the l1s were outperforming eth was was a a result of of these different funds of well he says it was a result of FTX taking money from from their accounts that should have been Ethan Bitcoin and putting it into Solana Avalanche take your pick but uh well I do agree with that I just think

that that doesn't go to completely say that these these ones have no value and won't come back and that there's not developers building there uh to make the ecosystems better and to yeah yeah I also Echo that opinion I think like sure like if you're coming from like a tech Maxi perspective you're like oh l3s and like you know ZK whatever but I mean the reality of that is a lot of that probably won't be ready um in time for when somebody needs to use it so like if you actually did start having these more traditional Fortune 500 companies come in and they realize that you know they need to be able to easily deploy something or maybe they

want to run adapt on a chain I mean just because the tokens price is down and all the sellers sold the tech is still there I mean Avalanche for example like down only but they still have subnets they still have like some partnership with Deloitte like if Deloitte wanted to like build some customed apps on a subnet and spin it up with their own validator set I mean that's still totally plausible so I think that maybe in the short term all l1s are still okay and I mean on a big enough timeline if you have like all these companies and we're really supposed to have you know the entire world using blockchain I think all ones

will still have some sort of place there I feel like you're coming after me with that one pills um but yeah I I have to take double that Devil's advocating on what you guys said um like if you're you're trying to build on an evm chain why would you go to Avalanche C chain or to maybe an L2 on Solana why would you not just go to a ZK evm or optimism and arbitrum um that's sort of my question um as well as what like you said um if someone wants a solution out of the box like why would they not go to something that's already built but I think I think you're underestimating how

quickly these DK evm and ZK roll-up teams are building um I think we already have baby Alpha from CK sync and we're gonna get a lot of mean that's in q1 and Q2 of next year so I think it's probably coming a lot earlier than you think and it's going to be ready ready to go um and so that's sort of the the bearish take on them given what you just said if I share my screen here real quick we can see what the market thinks and I just find this chart super super interesting looking at basically you know every major L1 including Bitcoin um and you really see this division into two separate groups right you have Bitcoin ethereum and atom and then avax near Phantom and soul

um it's just like you see the merge happened in early September and that is like really where this Divergence becomes very obvious uh and then like again in the FTX collapse region in in early November it becomes like even more solidified that there really are two tiers uh to to this this investment class now and if you look at like the beginning of the year uh you know it's it's back and forth you have tears crossing over you have assets moving everywhere and then now we have again these just two clear divisions which I find very interesting um but you know I think there is a legitimate point to be made that like if the tech is marginally better on an ALT L1 why would you go there versus like something like ethereum where maybe the

tech isn't fully baked out yet and like we're really still working on building the scaling roadmap but there are the users there there are the people that actually trust the the chain to transact in a certain way and it'll be interesting to see like how those trade-offs get played out agreed yeah I I would just like to raise the point that like you saw something like step in get built on Solana if they would have just deployed that to mainnet ethereum like the argument is then I mean look at the other side landment when they burnt like 227 million dollars like if I'm trying to just claim my damn reward tokens for taking a walk I'm not going

to pay 120 for that transaction to go through but it could be different in the future now that we have these l2s it's just they themselves need really strong BD teams who are going to be able to give them an out of the box package to get something deployed yeah for me this argument comes down to two things if you look at D phylama's languages dashboard by tvl it's like 98 or ethereum native languages that are locking uh the value in defy and then you see the crypto market caps like eth is what half of smart contract language market cap so that just doesn't really add up to me first of all and then second of all I don't think users have that much of a

preference between transaction fees between arbitrum optimism whatever other ethyl 2 versus a Solana where it's fractions of a penny like I don't think that's there yet I don't think people care to pay one or five cents versus one tenth of a cent I don't I just I think it's mostly people in First World countries who are doing this stuff as much as I hate to say it because that's not the point of this industry um but yeah I think there's just low preference for transaction fees in general so that makes me think you know maybe ethereum should be prioritizing like account abstraction over something like 4844s which makes it cheaper for l2s to settle on on ethyl one but I mean that's I'm not in all core's Dev so I'll

leave that to the the smarter people to decide and one other thing is so the the sort of Solana thesis was the ability to be composable with other applications that was sort of the thesis of a monolithic chain is that in order to have direct composability you need to be built on the same chain and so I think going forward since we have things like IBC where you can have direct communication between blockchains and not just on one single blockchain as well as if you have l2s and l3s that are on the same circuit you can have bridges that aren't really Bridges like hyper bridges on ZK sync that essentially you can have posability without needing to be on a monolithic chain and at that

point the network effects really began to take over because the the more applications the more liquidity that exists on these chains the more likely that a new application is going to build in that chain and be able to directly plug into those other applications I think you know if these monolithic chains especially with D5 want to survive they need to really build up their Network effects now for the next Bull Run because I think it's because gonna become essentially winners we get winners and the network effects are going to take over all right I think we hit that one pretty hard on to another controversial topic Bitcoin in its longevity through its security model Westy I know you've got

some words here so I'll pass it over to you first oh God we're gonna have some anger comments and uh Dan already called out the polka dot and cardano crowd and okay now we're calling out the Bitcoin crowd um yeah I just think um Now's the Time to start talking about Bitcoin security model before it's too late because in my opinion it seems like this is the consensus view on crypto Twitter which I didn't think was was essentially Bitcoin security model um eventually uh isn't going to be sustainable because eventually it'll need to rely on transaction fees as we get more and more happenings of the block reward and right now um Bitcoin as a network isn't really

being used enough for the transaction fees to be meaningful and if Bitcoin remains a store of value that's going to remain the same because people are just gonna hoard their Bitcoin as opposed to use the network and so I think now's the time to think about how to make Bitcoin as a network more sustainable um going forward and I know it's a tough conversation to have and some people are really hesitant to to change anything about Bitcoin which is sort of what's made it so great so far but in my opinion I think something needs to change either that that's the inflation schedule the block size something where Bitcoin itself can be more sustainable as we we go further into these

happenings so do you think we break away from the 21 million number and if you know transaction fees just won't be large enough to fund the the security of budget of the network then you just continually print more Bitcoin and if so doesn't that like kind of defeat the purpose of Bitcoin in the first place yeah that's a great question I think there's two solutions that I've heard one is like lowering the block size so that transaction fees on a single transaction are higher and so you can generate more fees that way and another that I think I agree with but I think a lot of bitcoiners will disagree with is like you said the 21 million cap like I think will need to have some inflation

um I think small inflation maybe one to two percent something really small but enough to sustain the network over time um but I don't know if I feel like Matt has opinions on this as well yeah I mean I just want to say it's a fact that Bitcoin computational security can be secured by transaction fees alone like that's about that I'm not saying it will be but it can be that's you know 100 possible um it's not out of the question it's maybe not likely but it's definitely possible I think that as l2s specifically lightning Network on bitcoin get increased usage and increase capacity uh it'll be easier to secure that base layer Bitcoin and I guess I would just say that I think the Bitcoin I think Bitcoin is good I like the way I

like the way it works I like the way it looks um and you know you can you can call out Bitcoin people and that's fine but the you know proof of work Satoshi the Bitcoin white paper like this invented the whole industry it's decentralized peer-to-peer money it's as close to trust minimized as exists like when you look at trust minimization you compare Bitcoin to ethereum or Bitcoin to uniswap it's just you know night and day they're not the same so I I do definitely appreciate bitcoin's value proposition so what happens if nothing happens I guess is the question right if Bitcoin just stays Bitcoin nothing changes but transaction fees don't pick up either and then let's say we fast forward two

happenings from now so I'm just like thinking aloud here right so miners would start uh would be losing their profits and then eventually get to the point where there's so much hash rate on the network that the computational resources required to mine a new block uh are greater than the reward you would get for mining that block and at that point it would be unprofitably mining Bitcoin so miners would start shutting off their rigs hash rate would start winding down it would have to find a new equilibrium but it'd be in like a Perpetual downtrend at that point uh until it hit like a certain floor where like the transaction fees that currently exist on the network would be still offsetting the amount of revenue for the remaining miners uh so basically what

that does is lower the security um and at one point would I guess it would theoretically be could be profitable to like attack the network at that point so I don't know like if it does nothing it it it's in a downward trajectory which if a system based on like you know trusting the currency um that wouldn't be a great trajectory path so I don't know I feel like something does need to be done but the question is like how do you solve a problem that you don't really know what the what the issue is right like we don't know uh what the level of demand will be for Bitcoin transactions if you fast forward you know six or seven years or one or two havings um and so it's like well how do you try to fix the problem before it happens it's a

tough question to answer yeah and I'm not saying at all that there shouldn't be innovation in Bitcoin that everything should be completely ignored I just think that moving slow is a good way to do it for instance I do truly believe that if ethereum proof of if ethereum proof of stake was successful for 20 or 30 years that that would then be something that the Bitcoin Community would probably have to have to at least consider but at the same time like I don't think that's something the Bitcoin Community should consider after six months of a successful proof of stake ethereum so I'm not under the camp of oh bitcoin's perfect there's nothing that should ever be changed I'm just under the camp of that it's okay to move slow that it's okay for it to work how it works today and that there is no like

you said sure there could be a point where it becomes profitable to attack the network but it also could not be so I think that it's worth you know thinking about and taking slowly versus maybe like moving fast and it's kind of terrible to say that because it's not like ethereum or Cosmos or anyone else moves fast but but yeah yeah if Bitcoin doesn't do anything it's gonna go to zero I mean the security model isn't sustainable as is but I'm a huge believer in Bitcoin I'd bet on human Ingenuity and people who have been holding bags of Bitcoin to make a change um you know before it it spirals out of control you'd think they'd be able to put something together I'm in the camp that lowering the block size the you know purposefully increase transaction fees makes the most sense but I mean who

knows I just find Bitcoin super fascinating because it's really the only crypto asset that ties together real world you know I guess resources in the form of electricity in order to to mine a block so I think there's a huge value in that and people from traditional Finance can kind of wrap their head around that if they're really forward thinking you know there's certain macro economists who who I follow who I know are big Bitcoin endorsers so I think that's super valuable and I also just think that Bitcoin won the war of of proof of work like at its peak ethereum still only had 3x the hash power of Doge and if you put them on the same you know access you can't even see ethereum's proof of work hash power in relation to bitcoin so it's incredibly secure and I think Asic like computational power will

continue to get better and with the difficulty adjustment I think it's a pretty robust system um yeah I'm bullish Bitcoin over the long term I know most of us aren't here other than Matt and myself but I think there's a place for it in the world even if it's only five to ten percent of the total crypto market cap in the future I I guess like the easiest solution right is like okay we'll increase demand and this kind of solves all your problems but the issue with that is to increase demand you have to be sending Bitcoin right and this is like why I think stable coins are such a huge advantage on ethereum is like I can pay ethereum to send a stablecoin transaction meaning I can pay you know a dollar let's say to execute a transaction that sends millions and millions of dollars whereas

on the Bitcoin Network I have to pay a small transaction fee couple cents to execute a transaction that sends millions of dollars in Bitcoin uh so it's like you want to be this Premiere at like secure asset that is built for saving yet it needs to be sent in order to like save the security design of the network so I don't know it's a really interesting issue to be solving all right it's getting pretty long here already at about a minute or an hour and 15 minutes so let's go to the last question of this uh end of your wrap up I'd like to get everyone's uh one pick for 2023 of a sector that will outperform just one Niche and crypto crypto uh I guess we'll start with uh Westy I'll pick on you first all right I gotta

steal this before you do um ZK EVMS are definitely in the sector I think will outperform I'm super excited a lot of them are in like later test that early being that and I think in q1 and Q2 we're gonna get me netsos EK EVMS and yeah I'm excited because uh they have really high potential and each project is tackling the the ZK AVM space a little differently so I'm excited to see how that space evolves and competes with the optimistic Roll-Ups right now totally agreed uh I'm gonna take liquid staking derivatives lsds I think that oh wow I must have stolen that from Dan based on his reaction but I think that as not everyone's gonna have 32 ethereum

especially presumably if ethereum's price goes up which I think is the Assumption of most people listening to this podcast so we will need liquid staking derivatives as a way that everyone can access that yield additionally obviously gives the added benefit of capital efficiency so whether it's lighter rocket pool you know one that doesn't exist yet stakewise I have no idea but I think liquid's taking derivatives will outperform in the next cycle you did indeed steal mine so that was that was painful to see I totally agree with you liquid's taking uh they're poised to be sitting in a really important position uh in all of defy and uh yeah I definitely agree with that but I'll go dex's I mean obviously this isn't like unsurprising by any means but um I do think Dex is not named uni swap

stand to like gain a significant amount of uh uh I don't want to say necessary market cap but so you need to walk uni swap absolutely dominates Dex volume um and I don't think that that will continue into perpetuity I think it'll become a more uh fair market as newcomers enter the space and look to swap tokens I think we'll see a shift to using aggregators rather than uh just like the Dex interfaces themselves um and you know there was a report that Delphi digital put out not that long ago that you know showed that if you simulated every transaction uh that happened on univ3 in a curved V2 pool there I think it was like 67 or so percent of the time the curve V2 pool actually threw a better price and so

it's pretty interesting that I feel like a lot of what uni swap is today it first of all it is a great Tech and it was like a first mover and it did push the industry forward this isn't like shade at Uni swap but I just think that they are so dominant in the space that it's it's only natural to see more competition enter that space um and then you'll see different token design have a huge fact Factor here right so curve has kind of like dominated and a well-executed implementation of vote escrow tokenomics uh you see you saw a balancer do something similar and their trading volumes have increased as a percentage of um the market but you know they they haven't had a perfect implementation of vote escrow tokenomics right so they've

had some issues with governance and kind of had to work around like you know working with some adversarial whales in their ecosystem then you see someone like sushi who really fell behind in this race and for Market volume but is like you know their governance forms are very happening these days their new head chef or AKA CEO Jared gray kind of came in and has really turned the ship around and is you know thinking about things like Runway which maybe that hasn't been a priority in recent years and you know you're going to see a new tokenomic implementation there uh you know relatively shortly that's going to like look to think about how do you incentivize activity um in for the long run so it's it's interesting to compare those models to something like uni swap which has really

no token design and even if they turn on this v-switch I think that might hurt their trading revenue or their trading dominance rather than help it although it will help their token on the other end so I don't know just kind of things I'm thinking about I'll go next I think there's something to outperform in the gaming and interoperable nft sector and I don't know like what it is I don't know if the project exists yet but I think there will be like a mini cycle of some game either it's like really successful or it's just a really fun Ponzi but either way something's going to pop up and I'm also going to take a bet and say that it's not on ethereum

I love it that's a bold take and uh also goes along with your uh alt L1 theme that you chose that you know they will actually Rise From the Ashes so respect there I'm actually going to kind of copy you and start or end it how I started it I'm gonna go with nfts as well I think nfts are culture nfts can be music nfts can be Collectibles they can be loyalty programs I think they're the best use case outside of stable coins that has popped up in crypto and I think the use cases are still being uncovered and I think 2023 we're going to see some web 2 companies like Starbucks like meta like really gain some successful traction and then I think we're all going to be listening back to this at the end of next year and be like yeah Moon birds were at 70th

like board Apes went all the way down to this and we're all gonna be like we had another opportunity to grab OG Blue Chip nft projects uh on the market for pretty cheap and we didn't and I know I won't buy one but I think we'll regret it stronger all right well great that was an awesome episode thanks guys for carving out like an hour and a half of your day that went a little bit longer than we expected once again thank you so much to our wonderful sponsors Flipside and chain analysis we will be back after the holidays for another episode so we'll look forward to seeing you guys then