Alex Gluchowski & Sreeram Kannan’s New Approach to Scaling

Transcript

this is a crazy this is not a place that anybody wants to build any business on top of ZK Remains the end game it's like it's the only logical consequence like how things will be will be built this is the paradigm shift that helps understand the ZK mental model in in its current form welcome back to the rollup your home for technical talks and open conversations that shape the modular future nothing on today's show is to be construed as Financial advice you can see our full disclosures list at tholl up.co FL Ventures sit back relax and enjoy today's episode after a quick word from some of our awesome Partners innovating Finance Global institutional and onchain deep liquidity to drive Capital efficiency now maximize yields

on institutional grade liquid staking with M unlock trillion dollars of capital via F Bitcoin all of this secured by mantle treasury of billions stables and eth Capital Pools this entire ecosystem is coordinated by a vast network of season BCS that are aiming to create the next generation of Banking and Financial technology this is mantle all right guys gmgm we are the rollup and we are here today speaking with uh two of the leading Builders uh in the ecosystem of ecosystems we have Alex uh from ZK Sy

the inventor of ZK sync we have sir ROM uh the uh leader of aigen layer and some might say the inventor of reaking um very very excited here because uh there's a partnership brewing and uh we have the pleasure of speaking with uh the heads of both of these ecosystems guys thanks so much you guys have both been on the show before um and and now we have uh the pleasure of of uh speaking about this partnership where it brings us all together um maybe we could each just lead off and and discuss a bit about uh how we're feeling post Denver before we get into the meat and potatoes of of the discussion sir Ram's laughing why don't why don't we start Siri Ram uh yeah it didn't where uh the mood was a

bit somber I don't think I know uh just before this you know we were our finger throbby that this is a great time to be a builder but maybe not so much to be a Trader and so you know we we're we're all Builders here so we're pretty happy about it but uh the broader sentiment that I saw at Denver is there is a pocket of institutional adoption that people are excited about right like the you know the regulatory Clarity and institutions coming up so and and you know Alex and ZK are like leading some of that so would love to hear from him about it uh but one thing I found was

the whole whole Space seems to have almost kind of like uh for whatever reason just uh think of only the financial apps as the scope of what this broader crypto and blockchain uh project is and we think very very differently about that at I so happy to talk about it but I think you know if you go back to something like 2017 2018 and see like the mood in ethereum you would see you know people talk about hey can we build a uber can we build social networks can we build like move the whole world on chain like that was the mood and I I think what happened from then was you know as we

started hitting many of these people who had all these creative ideas started trying to build it and like blockchains were neither scalable nor expressive to actually like fit the kind of creativity and Imagination neither the infrastructure not the developer experience not the user experience were ready but I think it's very different in 2025 and so what I would really like to see is the the smaller pocket which we inhabit right now which is all the other applications that can be and should be built on top of blockchains because what what application doesn't benefit from verifiability in the world that we live in verifiability is the the kind of like

the scarce resource in in you can ask like in the world of abundant intelligence what is scarce right what is scarce verifiability and like what is what is true is going to be scarce and so I I think there is a huge opportunity you know think of verifiable media think of verifiable you know news think of verifiable Agents think of all kinds of things so I think we're as a space I one of the things I hope to do is to reignite that you know uh creativity and passion for bringing verifiability to everything yeah absolutely and ZK is a very very crucial technology and piece of this verifiable

puzzle um and and that leads to the partnership between zky and Ian ler that we're here to talk about today um Alex maybe you could kind of set the scene for you know in the context of a verifiable world why ZK is important and why this partnership between ZK sync and I layer is important ZK is the way you can scale verifiability of computation because in the world without ZK the way you live up to the don't trust verify Maxima is that you actually verify everything so you you recompute every single thing that that you want to verify whether it's Financial transactions uh and we still believe that all of the world's value

transactions will come uh on blockchain will become web PR transactions but also non-financial ones the um uh computations of uh some data sets health information whatever like non nonf Financial use cases you cannot R verify all of that on your computer you cannot reverifying on today's blockchains combined on all of the blockchain cannot round it like every user cannot rify re recompute natively or naively reexecute the dist uh so what happens today is people delegate this verification to others introducing trust assumptions and

trusted players and those players are becoming very powerful politically and economically and they're starting in in injecting the extraction mechanisms economically and this works against the users and we kind of rebuilding the finance 2.0 all of that is unnecessary with ZK if you build a system that expands fractal wise like you want we have the global settlement layer I think is ethereum and you have all of the blockchains uh producing zero knowledge proofs and then you combine that recursively and until you have one single proof and you put it on this global settlement layer you can expand it fully elastically there's no limit on how much computation how many

transactions how many users you can add to this network just like the internet you know you keep adding routers and servers and you can expand it infinitely elastic and um the bottleneck for that was that infrastructure was not quite as good you know if if people don't value um inherently the uh you know let's put this way most users don't understand the longtail risks they don't understand risks at all if you think of M go and ft and uh countless billions of dollars broken uh on on Bridges operated by custodial entities people just like are taking the

risks lightheartedly and and and just keep using these things because the products that they use there that have this high risks are just more convenient they they they are slightly better as a product at the expense of the risk and cost if we can replicate these products with all the same properties that make them great products but we have the ZK um verification underneath and we have other mechanisms and like I I I'm really really inspired by s's vision for how we go beyond just the computational verification how can hold things like hold commitments uh accountable like on a broader crypto

economic scale uh we can build an entirely new world of value and this is what excites me and this is what we're working towards and this is what we will see um materializing this year more than in any other year before every year is is is getting better and it accelerates one thing Alex didn't touch upon but is actually spending a lot of time working on is the Privacy site to verifiability I think this is a huge deal uh in some sense this is you know like Alex touched on a little bit on how people under index on verifiability and safety uh and it's true right but I

think there are places where people are going to index very heavily on privacy and I think blockchains by creating this panopticon in some way that all transactions are public and visible are going to put a lot of pressure where it's not just consumers worrying about data companies are going to worry about data because you know imagine I'm Uber and I'm using you know like a a rollup to run all my transactions or a blockchain to run all my transactions now suddenly you know Lyft knows all my like pricing and everything that's happening is going to put asymmetric pressure on usually the powers that didn't want this verifiability to come

in and say oh actually I need privacy right like this is not acceptable and the really cool thing you know the whole technology is called ZK and ZK is really for zero knowledge is for privacy it turns out to also create succinct short brief quick verifiability and you know the funny thing I see outside of the ZK stack people have massively under indexed on this real real problem that I think we are going to phase as a blockchain community we say oh we want Real World Adoption Real World Adoption but it's Absolut like uh unacceptable to say everybody's transaction even with their public key

is going to be like on like a private you on a on a public ler Alex if you want to speak to what's going on in the ZK valadium side I think that's 100% that that's a really really great Point uh users and users can of neglect this uh or like take privacy for granted but uh the I cannot imagine real people uh moving all of their financial transactions on the public Ledger that is completely so that that is that is an absolute prerequisite but it it uh we will see uh I think uh more of these applications uh starting with institutional use cases the institutions

we're talking to and we are touch with you you you've seen the we uh Pilots uh that Deutsche Bank was doing menn and the UBS was doing MNC and and we conversations with the banks in America they hold me with privacy like like this is the the one reason the institutional private blockchains did not uh happen and did really take off was because they give you privacy but not interoperability and the public ledgers did not take off because they give you interoperability you can connect different banks together but they like privacy because now everyone will see all the transactions that happen in this ZK

chains for the first time can you give them both control privacy of their own chain of of their own assets and processes and transactions everything that that that is preview to them but without losing this interoperability with other closed systems and with other open systems with ethereum with chains on ethereum with digital assets that these Banks can now custody and we we heard I think last week uh there was an announcement by uh the White House the banks can can now do the custody in the US and the regulations is clearly on March in the US and then from there to the rest of the world to like massively Embrace blockchain Technologies for

everything and massively accelerate the adoption of actual crypto and and actual blockchain tax which is incredibly exciting incredibly bullish for the industry and the I think the the short time term price adjustments that we see now are like kind of caused by the mar situation like we we know that there are political reasons for this and we know that the the the trends will reverse like they must reverse for political reasons again like by by before next year we don't know exactly when this happens but uh we like Mar laps has gone for multiple Cycles uh in in our history bare markets are the best time to build they quiet you don't have the hype you don't have like a lot of players that

are just yapping a lot and not doing anything you actually can see who is in it for who is creating value who is worth working with and who was here just for BL yeah just doubling down on that point the uh the the thing about there is a kind of like broader societal scale problem which is the Privacy verifiability problem right you go into like a TSA okay like the a us you know airports and then the TSA wants to check like you know what's in your bag and all the stuff like scan you there is a fundamental they want to verify right something some property that you're not carrying a bomb or something and but

it's kind of invasive to privacy and so there is this privacy verifiability tradeoff it's true for Sovereign Nations it's true for all kinds of things when you want to cooperate coordinate you have this privacy or faity tradeoff ZK solves this right it is a crazy crazy crazy thing to even imagine that that's possible and not just it's possible know it's practical that these things exist I remember like when I got into like this phas in 2018 I'm I'm hearing all the ZK stuff I was like why these people working on things which are 20 years out right and like you know in six seven years now and it's already it's pretty crazy and kudos to you know all the

Pioneers basically from the broader ethereum Community who actually made this possible Alex being one of the foremost among them but I think it's a huge huge deal and like we we talk a lot about crypto hasn't accomplished anything or we haven't s this is not a small thing this is a huge thing and you know there's a long long way to take this and actually make it you know be adopted widely but the technology is here and it's working and that's not a that's not a small thing and you know really appreciate Alex taking the lead on the on this stuff bringing the ZK stack to you know to these versati use cases you know whether it's privacy where faity

scaling all these things um the uh other thing Alex touched on a little bit which I want to just point out here is in a world with ZK do we need blockchains I think a lot of people are very confused about these kinds of things so I want to just like take a moment and explain like that what what set of things you can verify with ZK and what set of things you need other things to verify right so so I think it's useful um in a world with ZK computation you know which is just in some sense of mathematical uh uh mathematical computational just uh can be verified succinctly using cryptography so that's

what the ZK technology lets you do what you cannot verify is there are all kinds of other things like one of the things we care about a lot inous space is censorship resistance right so I I run a server and then I I make sure that all the state transitions are valid but I cannot prove to you that I included all the transactions that ever came to the server like that's not a this is a proof not of a commission it's not like a error of commission it's Error of omission right I omitted something and like you know you didn't even see it like all my state transitions are valid but now like I can freeze your money I can do all kinds of things so you know it's not just like freezing your money so normally we think of censorship resistance as like oh there is some

State and like you know state or like some somebody doesn't allow a user to do something it's true and it's super important that we want to protect against it but the scope of sensorship resistance is much much much broader and like I I I I think of for example whenever like Twitter used to have an API right where anybody can build new and interesting things on top and and on 2014 they figured out the API is kind of like counterposition to their business business model and then that's it the API is gone okay you raise price you do something and then the API is gone now this is not censoring users I mean Twitter is also censoring users which is a separate including forecaster right so forecaster

gets censored on Twitter arbitrarily because it's a competitor but you think about the the other developers that want to build new and interesting things on top they get censored if we don't think of it as sens censorship but essentially as a Builder building on top of somebody else's system you have no property rights you can just be thrown off like it's kind of like the way I visualize it you are building like a store in a mall that you don't own or don't even have a lease for and especially if your store becomes popular the mall is going to say it's part of the mall like this is a crazy this is not a place that anybody wants to build any business on top of right

and this is not a small addressable Market this is a massive addressable Market because you cannot get funded as a person building on top of Twitter Zinga built on top of Facebook they got a bar hug and choked and you know and if any of you are old enough to have played or known somebody who played Farmville um you know it doesn't exist anymore it just vanished right uh actually the guy who one of the guys behind farmwell is now building proof of play which is a which is a fully autonomous onchain game you know in the ethereum ecosystem as a rollup so anyway so the the story there that like sensorship is not just about you know

users getting sensored which is a big problem but not a big addressable Market but a big addressable Market comes from other developers cannot get censored for building new and interesting things so so so when you think about it you need the correctness of computation but you also need liveness and and sensorship resistance and that for that you need other mechanisms right so you need a decentralized blockchain you need to make sure that the blockchain all the validators collude and sensor transactions they'll be slashed forked all this stuff and and so that's that keeps this system and it's is okay so that's one one one aspect the other aspect is you think of things like an

oracle or uh Identity or other things you know important layers that need to be built on top but these for example an article uh let's say you were settling a prediction market right and you want to know if Trump won the election or not how do you know if Trump won the election or not who certifies it which news news source do you do you trust what is the right article for it on chain it's not clear what the truth is you know any group that you put May themselves become colluded right so you can think of like who watches The Watcher kind of a problem but off chain we know like there is social truth that you know who's the president of the United States has an answer and so how do you bring these

social truths on chain so so these are the complement to the strong objective mathematical things that you can prove with cryptography the other kinds of commitments censorship resistance Oracle correctness identity correctness all these different things are other kinds of commitments and how do you build these things in the most robust possible manner I think this is something that we think a lot about I and you know also sets the context for what this partnership is about and to to build on top the these are cryptoeconomic uh functions and we have verifiability at at the Forefront and cryptographic functions to enforce

verifiability there are additional assurances around uh commitments and upholding contracts that require crypto Economic Security and we have a balance in blockchains and in ZK to leverage both of those Technologies for the most robust systems um and and I think this partnership is evidence of the the uh the complimentary and consistency between cryptographic and cry cryptoeconomic security because we have ZK which is a hard cryptographic primitive and then we have reaking and and you know these two technologies um are exemplary of aen Lair and zky

respectively so maybe you guys can talk through I think you know s Ram you did a great tremendous you know un unpacking of the vision of why these things are important Alex maybe you could illuminate like how this works and the mission and the goals of this partnership on a more Tang tangible pragmatic level at zik syn we're building thetic nwork so we have have the we have created the ziki stack framework for building rollups or validium with ziki power chains and uh we're building a network that can expand that anyone can join and uh that creates

a space for interrup durability within this network um where people can customize the chains you can uh you know really really important property of this n of this uh uh this rollup cluster is that you can come come with your um very unique demands for the chain and implement it you can have a private chain you can have a public chain you can have centralized sequencer for high throughput and latency you can have a decentralized sequencer with your own token um you can uh you know do do some permissioning there if it's an Institutional chain and so on and for that all to work and for this interrupt

work work seamlessly every single chain has to be a ZK chain so we'll need to produce a lot of proofs the network is based on a shared um construction called the uh the the ziki router and we're building a component called the ziki gateway and all of that is standing on the shoulders of the broad decentralized governance um the Z stack is going to reach stage one this year hopefully maybe even approach stage two we we need to see like it's it's a big um important step But ultimately like the governance can only do can has very limited powers you can think of it as as a structure of powers with checks and balances the

governance can POS an upgrade and then the the chains have to accept it and everyone has to accept it as users they have time to exit and so on so uh this share components require a lot of resilience cannot be controlled by any single and it is not controlled governance is decentralized with close to half a million various token holders in the token assembly loan and then you have the security Council which is hired by the token assembly and you have the Council of Guardians and all they they have to all interact in order to keep system why and so it's critical for the the central components to not depend on

any like on any single point of failure and the same applies to the proof generation like the the like all this chains if they Embrace decentralized sequencing they it doesn't make sense to to have a decentralized sequencing have a through decentralization C resistance only to generate the proofs from a single data cloud provider which can shut them off any time it does not fit with the philosophy of of this construction this is not what we're trying to Pi neither way for each component to be redundant resilient and broadly

decentralized and for the um uh sequencing it's the responsibility of individual chains they can decide how they sequence we will build a component a consensus for layer to they can use that if they think that base sequencing is based is best better for them they can Embrace base sequencing and have the ethereum um you know kind of like reuse the the existing mechanisms for ethereum it's it's a question if it's like more decentralized or not and I've been a quite a critical voice on on the base rollups FR but still it's a choice of the chain they can decide this right but on the proving side it's hard like it's it's it takes a lot of infrastructure like we we we help metalabs we help uh

some of the chains run the infrastructure for them and we know how much it takes to just to manage it on on like one or multiple data centers from different qu providers it's a specialized work that needs to be done and I think it's better done by dedicated teams that Focus just on this component which also provides more resilience and this is why we partnered with uh um FMA and lran to create these decentralized networks uh and to offer them to the chains that can embrace them and decide that they will they will be generating proofs there and they need orchestration this orchestration is provided by ABS uh by later and as maybe you can talk more about that how all of

this works on the ABS yeah uh quickly uh summarizing that the uh elastic network has optionality for chains to choose various components and like the one specific component which is critical is proving right so the whole point is ZK zero knowledge proes have to be generated who generates these proofs and this could become like a centralization vulnerability and nominally I don't think it's it's it's it's specifically uh when it is a when is it a problem when is it not a problem it's a problem for when in in the in the quick low latency operations right so imagine you depend on a single centralized Breer and

like you have liquidations all these kinds of like complex things and then that prer goes down now you may have a an an an issue so whereas you know anybody can come in and become AER after some time because proving you know uh if if you cannot make a a safety fault on proving because that's verifiable and the the verifier is on ethum so it can verify that you did the action correctly or not so the the issue that can happen in aing network is liveness Falls and so a decentralized uh Network can actually be robust to these Lous Falls and so the the mechanism for protecting that is

cryptoeconomics so they stake and then they promise that they can actually they're going to go do these proofs and you can have like if you go one level deeper you have this problem that you have a decentralized network somebody says I'm going to do this proof and they don't do it or they don't do it on time so then you need a mechanism to punish it not just you need a mechanism to punish it you may not it may be too late it may be too slow if you after some time you hold them to account and then so there is a redundancy versus like performance trade-off right so you you can have more rany try try two notes to prove the thing and you know or you can make them stake more and then like hold them accountable so these are all various complex uh mechanism design

tradeoffs in actually building these Pro networks and we have are lucky to have like two very strong teams building different kinds of abss uh in to solve this problem um one is lrange which has its own own mechanism designed for doing this and we also have FMA which has its own mechanism designed for you know how many to do in parallel how many so how much stake is there like who Stakes all these Dynamics which are pretty intricate and so that those two networks uh you know this in this broader umbrella partnership you know they are being options for decentralized proing for the

elastic Network so chain coming in can opt in to one or both to say like oh I I wanted solicit proofs from one or the other or load balance between them all these different things over time so that's the high level idea is liveness protection with cryptoeconomic guarantees and especially this is material because in the absence of such economic protection what you would have to do is to have more redundancy which is not a which is you're paying more cost because the dominant cost in running a ZK network is the prer cost so you don't want to have too much run that if somebody can put a lot of money and promise that they can actually they're going to do their job correctly then that's that's great so that's the overall like structure of

what a decentralized FL network is we have multiple these two different implementations and really excited to work with uh ZK stack in showing this specific thing that I just alluded to earlier which is ZK for like you know correctness safety and you know Economic Security for liess and so that one specific embodiment of this prod tradeoff Redstone is def's modular Oracle supporting over 100 clients on over 50 chains offering 1,000 assets Redstone is the leader for Bitcoin staking and yield bearing assets they offer the most robust customizable price

feeds available in any model join the Redstone exhibition today [Music] yeah so maybe I'll talk a little bit about like what uh the uh we haven't talked about Igan da and you know the relationship with da and CK stack um so you know as some of the listeners may know we also along with building igen L we're also building Igan da which is a data availability service and the simplest way to think of it at data availability is um you know when you're doing all these computation you're verifying that the

computation is correct using ZK right but if anybody else wants to pick up and do the next computation the outputs or the state of the system needs to be synced somewhere the state of the system needs to be returned somewhere so that you know imagine Alex is running a sequencer and you know he he even write ZK proofs and keep making State updates but Alex says okay I'm done man I'm not doing this job anymore and he retires so then you know how do you how do you pick up and continue the computation if the output state of the the most recent State update that Alex did if those were synced into like a Data Network that anybody can go and

pick up the data from then you get this property that actually the next guy comes and they can actually sync to the DA and then they know the state and they can now continue on and making proofs so again like the safety versus this kind of liveness right so the liveness relative to the sequencer and uh you know is is provided by actually writing data to a data availability layer so I'll just talk a little bit about I and then talk about partnership IA is U built on uh the uh built on I using both e staking and igen staking and you know these two serve different roles in the in the network

and so what happens is every time you write a data into this network uh the E stakers and the stakers both have to sign off that they have downloaded the data all existing networks other than igda require the nodes that perform consensus the nodes that sign off on the data to download all the data like so every node rally downloads all the data and I is not built like that IG is built on so we call this the hyp scale ta the reason is you have horizontal scaling that's the exact technical terminology right so you take the data then you break it up into chunks and then you use this thing called kcg erer coding so which is take these chunks and then

create new chunks which are mix and match of these combinations of this these chunks and then you spread that data all around the network and these spreaded pieces have the property that even if I only have 50% or whatever fraction of the network this is a parameter and I'm able to decode all the data no bit of data is lost so any 50% of the network has enough information to decode the entire the entire block and you can do this in a very very efficient manner so without taking too much overhead you can actually do this so that is that is the whole point of kcg a coding and this was actually this is in the ethereum road map this is called D sharing and you know ethereum you know as we all know is

UNL is moves slow and conservatively as it should for a base layer and so what we have done is taken some of those ideas for how D sharing works and then built I as a hyperscale data data avilable here and and so you okay I'm saying all these words hyperscale and so on like what is the actual numbers it's running today on mainnet at 15 megabytes per second 15 megabytes per second so you know bytes and bits people get confused one byte is8 bits so 15 * is 120 megabits per second and so this is at least 50x larger than you know ethereum blobs and 10x larger than other

Das that you know you may have heard of so that's where we are today we have the ability to scale this another 100x because this system like I said is fully horizontally scaling there's no one node that ever needs to download all the data this is how we hit internet scale in our view is if you said oh this one node needs to know all the oh I have a big consensus node each node needs to download all the data that's your limitation so you know this is our beef with Solana let's say is you know so people say Solana is scalable ethereum is not no actually ethereum figured out how to actually make these things scale ethereum research ethereum engineering is a little conservative on how fast you want to implement these things what

we've done is just take all those great ideas and just build it right so that's how I I can works it's completely horizontally scaled there's no one note that needs to download all the data we can scale this another 100x you know there's no theoretical limit to it it's just how many more nodes how much is the bandwidth of each node instead of being limited by the bandwidth of each node you're limited by the total bandwidth of all the nodes which makes the system just like keep scaling so that's the kind of cool part with I da and so we're super excited that this is again like a very strong complimentarity because ZK gives you the safety da gives you the Li and know like you P these two you can you know you get a very very strong system this this resonates really well with

people we with with projects we're talking to who are building on on the elastic Network or who are considering different uh Ro clusters to join one of the requests we hear is we want to have optionality on on the Da Side we want to be able like we see the developments of I da and and similar uh uh projects and like we we believe that it can be a lot more Innovative than what currently can get on ethereum or what we might need in the future we want this optionality and this is one of the things elastic met neatly enables this optionality of Da not bound you're not forced unlike other some of other rollup clusters you're not forced to use only the MBA you can come

from a very very specific architecture design that CK uh stack chose uh I don't know Alex you want to talk a little bit about State diffs and and and you know how this allows for this you know different uh things to be run on different uh da I can try to explain it's a bit it's a bit technical but yes it took a a very deliberate architectural Choice like uh if you are building your rollups as um um like you publish inputs of transactions which is what all the all the optimistic crups do today publish the inputs like the transaction data

itself then the only way for for you to reconstruct the state of this rollup is to actually execute all of this uh transaction it's like whoever is getting the The Da updates has to get all of them for all of the rollups in order to be sure that all the interactions the interop between the rollups is valid if you miss just one of them and you get the message from this rollup there's no way for you to check whether the message is correct you need to verify you need to re-execute all the other transactions and you don't have the data this forces this optimistic crups to kind of um either like separate the the rollups or like the chains in

the systems into two classes first class citizen is publishing data on ethereum all of them are kind of the same and and uh you can only publish on ethereum because that's the only way to ensure that everyone will always get them if if you're also synchronizing with ethereum full note and then the second class citizens were like kind of like you just have to trust us like you don't have any choice like you trust us we have out is a risk contamination by allowing both into the same cluster because you know if you had like different security models are in the same cluster one of the rollups in that cluster might say something which is false because you published da you know dat you publish to like a lower grade da or something and then now like that can create contagion

throughout the system so that's why I think they the the illation there is they say like here's one trusted player everyone who wants some some custom data you just have to try you know you don't have any say you give up your sovereignty to this one guy who's going to provide like who's going to tell the rest of the world what you want he's going to speak on your behalf you know like a little bit like like politicians and I don't know what compare right so this forces you either you you you be like everyone else and you use ethereum or you just use this um delegation of power to us what you can do in the elastic network is you can choose your own data availability and then if you

made a b bad choice and your data availability solution fails it just it affects only you does not affect anyone else because your all of your messages all of your interactions with the rest of the network are ZK proven so they are guaranteed like we we get the message we know for for fact that this was correctly executed in your chain even if this data is not available to the rest of the world your chain will freeze but it won't affect the rest the rest will like properly handle it and everything will work fine so you can you can decide that you can start with ethereum data availability but then switch to a DA and continue with a DA and like everything is going to be fine you can you can do

this Choice any time it's very powerful gives a lot of power to the chance a lot of flexibility a lot of freedom and sovereignty to the chains who join the elastic Network they don't join something where they submit to and and give all the sovereignty away no they keep the sovereignty they keep the full control their own decision- making but they still benefit from the network effects and interoperability and and the the like all all the infrastructure that is already existing in the elastic Network through the integration with era and so on and so like this is a really really this is probably one of the biggest um advantages that chain gets by becoming ziki chain and joining theer compared to the rest of world yeah and I

I think this illustrates uh a mental model that um we've adopted on the rollup and I've talked a lot about and it's this transition from A hierarchical View layer one layer two layer three four five so on to one of uh ZK everything ZK abs like ZK uh uh States kind of just floating in the void and connecting those via our interrupt Solutions such as ZK proof sending back and forth between one another verifying those on the destination chain having Insight on the to the origin chain via that ZK State proof and and I think this is when I had this realization it was a massive

paradigm shift because it was it was unlearning everything that we had come to understand of the layer one and and and hierarchical model and much more um and unpacking that into a much more um modular for lack of a better term it's a much more modular view on the world and so I think this is this is the paradigm shift that helps understand the ZK mental model in in its current form um so we're we're moving forward with that mental model and I think I think directionally it is correct um there's a lot of uh infrastructure pieces that are important and components that are important to this to this model um we

mentioned orchestration aan L is doing a great job with that we talked a lot about ZK proving and that's a very important piece to this model as well um you know we can't really talk about staking uh for the sake of you know safety and liveness without talking about slashing and so siram I am curious about the progress on slashing and and how that's coming along because I think that is a long awaited and very crucial part of this of this technology yeah absolutely um the uh so just explaining what the model is I layer is at least a three seted Marketplace could be like a four- seted Marketplace so what are the sides so you

have stakers stakers come and stake and then make promises that they'll run some Services correctly and then you have operators who actually run these Services it could be that the Staker themselves is an operator or or somebody else is an operator and then there is the third category which is abss we used to call them actively validated services so that require active validation and we've renamed it to autonomous verifiable Services autonomous because you're not asking any one person to do anything anybody can stti and keep the service running so they're autonomous they're verifiable how how are they verifiable because if they did something wrong you have to write a proof on an ethereum smart contract and then show

that they did something wrong and if that proof triggers then they will lose their stake this is the third side abss so stakers operators abss so where are we on these three things stakers we have you know 10 plus billion dollars of stake right says 5 million e around you know and you know it's been oscillating on that but e price oscillates more than how much e is there in our platform and then the next one is um operators right so operators we have nearly 2,000 operators starting from you know home operators to the big operators like coinbase and block Damon to even web to

giants like Google Cloud runs a first party operators so they themselves run an operator I so that's the second side the third side is if avss we have 100 plus avss in various stages of development 30 plus are on Main net right and and you know the remaining are are in tet I'm getting ready so these AVS so we call these actively validated services not call them chains because our mental model is these are Services right so think of a pral network think of this is a chain like it's not a chain chain right it's it's a service that provides something fundamental and and they could be like highly valuable as the pr network but that is not the same as it's

a chain right so I think we we have this you know speaking to Robbie's Point earlier on this is this L1 L2 kind of like a view to this Services view like you know there's a there is like SE series of these services and then you can mix and match these services to give expressivity each service allows you to express certain things and then you can mix and match them to build apps so that's the kind of view that we're moving to which is very close to how the cloud works right so if you if you're building an app in the cloud you go and integrate like tens of these you know software as a service layers these SAS layers are themselves built on a cloud like you know the Amazon web services and so there's a similar model I think

that we will see here and there's no layers in the SAS like every SAS any SAS can depend on other SAS in some V complex generic way okay so that's the uh avss and so that that's what the ecosystem is and uh in in terms of what I L does it does like the orchestration between these different SI right bringing stakers operators abss creating binding conditions and agreements between them and one of the agreements is like hey if if an operator violates you know runs malicious software whatever and tries to attack a service they have to lose a lose their bond and so that's called slashing right and slashing is not yet on Main so the whole ecosystem is on the main net you

know you can you can recruit stakers operators and run a service and pay for it but you go slash that okay so right now it's that's where we are right now on the main net on test net we have had slashing live for now like more than three months and there is a huge audit competition going on right now in Cantina the largest audit competition with2 and a half million dollars of price for anybody who can kind of find bugs we fully expect and hope people will find all kinds of bugs and take advantage of this big Bounty but that's that's going on and once the audit is completed and we have high certainty we

will go on Main net with slashing to set the expectations people think oh you know I doesn't have slashing as a problem no it's very hard for avss to build slashing okay so just want to calibrate the expectation here because why and you know as an AVS what is it that you're trying to do you want to offer a useful service so the way we think about what an AVS is life cycle is an AVS first comes and builds something people want right you have to build a service that somebody wants to use so you build that to be useful then you think about how to what is the economics of it right initially you don't even think about we're subsidizing the economics initially right so stakers are basically getting ion token rewards

that's how the whole ecosystem is running right now but so initially subsidize everything so that you know you don't as an avv you don't have to think about or worry about like how am I going to bootstrap my economics already there's a group of stakers and operators just come in and build something people want then you think about your economics and rewards and then next you think about how to make your service more trustworthy already you're getting some amount of trust by saying hey it's these top operators that are actually coming in and you know and they're trusted by these stakers with their stake and so you're running services from these operators already that's a level of trust and then with slashing you get this boosted level of trust where you're not just saying that people have put

down money they will lose their money if this ABCD conditions go WR so that's the next phase what happened for our slashing release was we had a slashing contract two years back on Main so it's June 2023 we had this slashing on Main because what is slashing just a command that just burns the money right so if you think about it very niely that's all it is it's very easy to write it right say oh you send a command and then just B themy but you have to do it very very carefully and doing it very very carefully means is is there a way for an AVS to slash your thing even after you have opted out is there a way for what is the timing consideration what is the unbonding period by which you have to

get there is a lot of complexity underneath it but also there is like more interesting kind of like structural or economic questions our initial idea of slashing so so I said it it was on meet but it was a turned off so slashing has never been on to and so the question the the initial consideration was is that if a Staker is opted into an operator and and and and an operator opts into let's say five Services they have $100 million they opt into five Services any one of those Services can slash the entire h100 million this was our original model and people were worried a lot on various dimensions on one side as a Staker any one service goes wrong then you lose all your money

so that's one problem then the second problem is as um as an AVS you have to worry about risk contamination so it's not just my AVS I have to worry about what if there are some bad aves that I'm sitting with and that a slashes somebody then like I'll lose my security yeah could you could you kind of connect the dots because this we talked about risk contingent when it comes to multi-a is there could you kind of like draw some similarities yeah yeah yeah absolutely I think this is this is very similar like when you think of like many rollups each of with Each of which have different security models and you create a high interop between them then what happens is like the weakest among

those uh weakest among those determines what security you get because you can get information from them that you may believe unless you had ZK where then you don't believe what what somebody says you already verified what they have said okay so that that's what goes on there here what's happening is you have these like many services right and a stake is St into a stake or sted into many of these services and if you get slashed on one you lose all your money then like the other service suddenly loses you know the the security that they had because you know I thought I had 100 million but that 100 million got slashed on the other service and then now okay so this is a problem so in general there is this like very strong tradeoff

between pooling or sharing the security and contagion right so you you want sharing makes cost cheaper but you get content so so how did we solve this we solve this with our new slashing model that's why we're very happy with it and finally you know uh launched it the the way slashing Works in this thing is we call it unique security unique Securities as a Staker or operator you let's say you have 100 million and you opt into five services then you proportion how much of that security you're allocating to each each one of this right so you say oh you know I'm allocating 30 million to uh This lrange and like 25 million FMA like all

this so you can allocate that very granularly on a week by week or an he by basis okay so essentially you are just saying that you take this big part and then split it into parts right then you don't get the benefit of fooling and that's that's what that was the kind of trade-off and then the way we resolve it is actually what we found is we have these like you know highgrade avss which want this unique security but there may be other avss like you know imagine I'm a new AVS and then I go in and I want to opt in you know it's I'm get just getting started and I want to try out something new okay I build this new article just throw it out and you know I put in some rewards and so maybe I get

only $1 million unique STI right so people say oh I'm putting in 0.1% 0.1% enough people put in 0.11% and then I get like $1 million of stick and normally if you had only $1 million of stake anybody can come in with $1.1 million of stake and completely take over your network that's what happens if you just had 1 million but what we have is we have two Dimensions one dimension is called unique security and the other dimension is called total stake total stake is if I'm an operator I have $100 million of stake but I've only allocated 1 million slash stake but I still have 100 million stake it provides a degree of civil resistance and a capture resistance so

imagine 20 billion dollars of total stake opted in but only gave $1 million of like slash stake now to take over the Quorum I still need $21 billion to take over the network Okay so you will only get slashed 1 million but you can't like just cheaply attack the network without raising $20 billion of capital so now we provide a very strong protection to the long tail of services which all can just spin up and like keep running and like a high grade service like let's say Unis swap or somebody wants or layer zero wants or infura wants like exact measurable security with no contagion they'll say I only count unique security

these TA of services can say I count secure and so it we solve the problem kind of like to our heart's satisfaction in that sense and it also prents this once once we had the risk contagion in our previous design we said oh you need to have a slashing veto committee and you know somebody like Alex or even myself is is too cringe for us to think that there's a kind of committee that is going to decide what what goes on right so this is our not star is we want to build self enforcing systems right and we're practical to say like what what is the degree of security we are at each point but the eventual goal is these should not have to exist and with unique security you're like you opt into an

avas you know you're potentially going to lose it if that service goes wrong that service has its own veto committee or whatever I don't care but there's no Global Universal like you know committee to decide like what goes on with everybody and this makes everything way more permissionless scalable all of that so so that's why we're very excited it took a long time for us to figure this out how do you solve this fundamental tension between um no risk contagion but also some amount of shat security and now I think we saw the tradeoff now we are good to go on Main Nets so on behalf of all the stakers in igen Lair thank you for uh doing it this way and launching it in test net and proving it out and

testing it right before launching it on Main net and allowing a risk contagion to get into the entire system um I I think I mean it's such early days that like you know it's important to do these things right more so than to do these things quickly and put billions of dollars at risk um guys I I I really appreciate you you taking the time and spending it with us today Alex I want to give you the last word as as we wrap up we talked about Slash and we talked about all these things and how they how they fit together maybe you can you can take us home through the finish line and and round out the conversation as it pertains to the partnership between ZK sink and I there we are extremely excited I I I found it really really interesting how the uh how it

works uh we are expecting a lot of our partners also to to to be interested in that the chains that on the elastic elastic network is growing we have big chaines as as you probably know we have um uh abstract is doing a fantastic job now with on boarding new users Lance is launching soon uh we have this institute partners that are exploring things pilots from UBS and doche bank and uh uh um era is doing a really good on institutional front as well with um uh you know over2 billion dollar worth of our real world asset which is second only to etherum itself um for billion uh so AR is definitely

going to use the the services for the gr generation uh I B expect all of the all of the sh like kind think of of a reason why not use this service uh if you're if you're doing uh the elastic Network except maybe very specialized institutional Parkers who want to control the the full stack of their operations so um really excited I fully agree that ZK Remains the end game it's like it's the only logical consequence like how things will be will be built and it takes the proper architecture we've we've been very consistent about this and they like I think the the market signals kind of can obfuscate it

uh um for a short period of time long term the ride things are still like uh um uh kind of like you you you you sometimes have the last mover Advantage when you build the proper product that will actually matter in the end uh uh eventually you have to embrace it and if you have this architecture up front and you don't have to change it if you don't have this architecture you have to rewrite completely remigrate your entire um Network effects which is like oftentimes detrimental uh long story short super excited for this partnership uh and super excited to be working

specifically with three on uh and work towards this bigger vision of actually decentralizing the world and desizing commitments thank you so much Alex thank you Robbie super excited for you know uh not just our partnership but for the space at large I think it's time for us to uh to think about what verify everything looks like what are all these verifiable abs what what sets of things should should we be building as a space to contribute to some of the fundamental problems we face as a human civilization so lots and lots to do there because I I think you know this this is not just a financial technology this is a technology for upgrading human civilization so really excited can't

have a better partner than Alex in this journey so uh super uh excited for what what we can do together absolutely congrats on the partnership and and guys thank you so much thank you Robbie it's been a pleasure as always thank you