Bullish Ethereum chat, Scaling the L1 and more - The Daily Gwei Refuel #826 - Ethereum Updates

Transcript

hello everyone welcome to another episode of De great refuel where up latest news in eum ecosystem I'm your host and 17th of February 2025 all right everyone let's get into it so we're going to kick off today's episode with a bit of a bullish rant about ethereum and eth of course I don't think I've done one of these in a little while and I think it's needed to be honest I think it's time to do one because I mean there's a number of different reasons obviously price action has been what it has been not just for eth though for like everything overall has just been kind of not fun over the last maybe couple of months or something like that uh and I think obviously you know post election we had that Trump pump as people called it right but then with all the Tariff stuff going on and with uh I

guess interest rates not coming down as fast as people thought that were going to come down and with inflation still running relatively hot markets are just in I guess a holding pattern right now but this bullish rent isn't about the markets in particular it's about ethereum and eth as a whole and I put out this tweet today where I said I know I know right now it's not popular popular to be bullish on eth but I still think that eth is extremely undervalued we've entered the ethereum acceleration era and I'm incredibly bullish on the future of the world computer and the world's best decentralized programmable money I'm going to be honest guys if I wasn't bullish on ether ethereum I wouldn't be doing the refuel at all I wouldn't even be part of this industry at all like it would make no sense for me to stick around if I'm bearish and

it's funny because I see so many people that are bearish all the time and they're still here and I wonder why they're here if they're bearish it's like okay you can do so many other things with your time it that doesn't make much sense to stick around if you're bearish on you know both the assets and the technology but anyway to each their own there but for me I'm incredibly bullish on on the future here and you guys should know why I think from listening to the refill but just to recap some of the high level stuff here when it comes to ethereum the network I mean I don't think we've ever been in a better place honestly because not only do we have the L2 ecosystem continuing to scale up ethereum continuing to onboard users continuing to get better and better and better with better apps

uh you know better usability better U X we also have a refocus on the L1 happening over the last I guess you could say 3 to 6 months we've had like a rior prioritization on L1 which I'm going to talk about a little bit later cuz vitalic published a new blog post about this but essentially we've really accelerated things when it comes to L1 core development and I think this is because of a number of different reasons I've spoken about some in the past but the biggest reason is that we've been having these like yearly hard forks and the problem is is that the with these hard Forks like for example Petra coming up in in April there's a lot of eips that are part of Petra right not all of the eips that are included in Petra are created equal for example there are eips

that are more important in Petra such as the account abstraction EIP for example and the one that increases the blob count than some of the others that are in there or at least most of the others that are in there so the logic follows that okay well we should stop doing these like Mega forks and start doing faster uh smaller Forks so essentially try to do a fork once every six months or even once every 3 months but have less eips as part of them because there are some things that we can wait for like there's a few eips in Petra that we can wait for they're not critical they're not going to make or break anything and they're not really something that needs to be delivered like ASAP but then there are things that do need to be delivered ASAP such as a blob count increase such as things like

pias such as I believe at least fossil the better sensorship resistance such as epbs I know those aren't in Petra they're coming later but those sorts of things are higher priority than things like uh I guess like fixing Tech debt for example as a is there or adding new features that maybe help stakers out uh with something like for example there is a EIP coming as part of pectra that allows for execution layer triggerable exits what this basically means is that you'll be able to exit a validator from the execution layer you won't need to use the consensus layer to do this which means you could have like fully trustless staking pools that's awesome right that's cool but that's not critical like I don't like as much as I love staking as much as I think that

staking is really important to the network it's not critical for us to have like Al exits whereas a blob count increase and and something like pias to me is critical because we're at a juncture where there is a lot of onboarding happening throughout crypto both on the retail side of things and on the institutional side of things so we need to prioritize scale for ethereum and I think that's what what we're doing now I think that's what the core devs and researchers are definitely uh realigning on and it and as I said it's happened over the last 3 to 6 months but I'm I'm glad to see it has happened there so that's what I mean by ethereum acceleration error U it maybe you could reward this and say it's both acceleration and just reprioritization where essentially we're getting faster at shipping things because we're

reprioritizing the things that we need to ship and it's not just on the L1 obviously with the l2s we want to make interoperability between the l2s better so we've reprioritized that so I think that there just been a massive reprioritization across the entire ecosystem here and that makes me very very bullish because it means we're focusing on the right things and getting them done sooner and basically having like the things that are considered maybe high priority or medium priority or nice to have we're going to deliver those but but later like they can wait sort of thing so I'm glad to see that there and I'm going to talk a bit more about uh blobs as well there was another post about this are there uh but then when it comes to adoption as I mentioned we're having adoption across institutional kind of um entities you

know corporates business entities but also on the retail side of things now of course retail is a mixed bag here you could say that there is probably like three subsets of retail I would say that there there's the retail that doesn't come on chain but buys crypto assets on a coinbase for example there is the retail that comes on chain but all they do is essentially gamble so like the meme coin stuff for example and then there's the retail that comes on chain and does a bit of everything so they might do the mcoin stuff they might go into Defi and borrow against their eth they might uh use stable coins for payments stuff like that right so broadly there's three categories maybe there's more but that's what I can think think of off top of my head right now in terms of the user bases that I have seen

so so those three categories we want to be able to capture all of them and they have different uh I guess shelf lives as well like the hypers speculative kind of only come here for the casino people they're not like long-term people they're not exactly the the users that are going to uh I guess like stick around for anything other than a quick Buck they're I mean they they're a part of the onchan economy but if they're the whole onchain economy then that's not good it's not a healthy economy whereas I think that the users that come on chain and do a bit of everything they're the ones that we should optimize for the most they're the ones that we should want to stick around the most because they're not just doing one thing in the economy they're doing many different things in the economy and basically

creating uh onchain uh economic diversity essentially which is what we want to see there uh and then I think the users that we want to bring on chain the most obviously are the ones that buy assets on an exchange but just sit there and don't do anything else with them because there is I guess like a fourth category you could call it of of users and those are the ones that haven't gotten into crypto at all they haven't bought any crypto on an exchange they haven't ever used an onchain product they're just like not here yet that's obviously an important user to capture but they will come in and they'll fall into one of those three buckets so we want to focus on that those users that have only ever bought a asset on Exchange and not used it on chain and there are multiple I guess focuses here

obviously coinbase has a really big push with bass going on uh infinex their entire thing is that they want to basically recreate the binance experience but onchain so essentially get all those users even those ones that are in assets that aren't native to ethereum such as um a lot of the top 10 or top 20 like other L1 assets and stuff like that right they want to bring them into the onchain ecosystem not just ethereum but across all of onchain there so there's a lot of that stuff happening and there's a lot of onboarding happening there on the on the retail side but I think that the for the foreseeable future a big story for ethereum is going to be on the institutional and corporate side of things and I've actually tweeted out a picture here uh that was put together by Galaxy research showing just some of the

companies that are building on ethereum or ethereum l2s these are not small companies Guys these are Mega companies like these are the biggest companies in the world obviously you have asset managers like Black Rock Franklin Templeton Fidelity they've got their ETFs they're building their their kind of like Asset Management things on ethereum you have lots of banks ironically building on ethereum payment processes Visa stripe Etc fashion brands you can see here on the right hand side here like Adidas Ralph Lauren K man like Porsche I I believe Porsche did an nft thing which was which was kind of cool there media I mean there's so many you know of these huge companies building on ethereum and the thing is is that there's going to be even more of them and they're going to keep building on ethereum and and I've discussed this

before on the refu where I said that I think the L2 model really lends itself to onboarding businesses into ethereum because allows them to build their own l2s as these I guess like quote unquote app chains they you could think of the business as like an app I guess and they would have their own app chain and and then they can interoperate with the rest of the economy but also have their own thing that they're able to uh essentially do whatever they want on sort of like the internet versus internet model there where internets can interact with the internet but theyve also kind of closed off systems that exist for that particular business or institution so on and so forth so I think that's that's huge there and etheral lies is doing a lot of great work within this realm not just with businesses but also like governments and

and institutions and and just like those really I guess big players that we want to like on board onto ethereum and get them building on within the onchain economy here so that's the other side of things so you have retail which as I said you bucket into three different different categories and then you have institutions and businesses which you could bucket into different uh different things right you could have like nonprofits and then you can have like for-profit businesses and then you can have um governments and then you can have uh uh nation states as well right like uh I mean I think government and nation state kind of I guess is a similar thing but governments change and States I guess stay the same sort of thing uh I mean over a long enough time frame maybe they don't stay the same but

I think you get what I'm saying here whereas like there can be government kind of like parties or I I guess I should say political parties building on ethereum and there could be the nation state itself building on ethereum or purchasing eth as part of a strategic Reserve so on and so forth there so we have just a lot of onboarding going on across the the the the whole thing here now obviously ethereum and eth are intertwined here I haven't talked much about eth but eth is is also playing a huge part in all of this as you guys know ether Cru value from multiple different areas you know fee Revenue that it generates it Cru value from it us as a story value as a money as a collateral asset in staking and we have a lot to look forward to on that front

the biggest thing I believe is the staked eat ETFs and I've talked about this a lot on the refi before but they're coming this year I think like there's no reason for them not to with a very friendly SEC now uh towards crypto so those things are coming there we have uh the eth ETFs actually seeing in flows and seeing pretty healthy inflows as time goes on I think those are going to accelerate um I think that uh when it comes to eth as an asset as well you have a lot of people just kind of offside on eth and just not and and a lot of them just didn't understand eth and I've heard from multiple people that are in the no so to speak that retail is really bearish on eth for some reason whereas institutions and corporates and businesses are really big on eth they

just really want to understand it understand what the value prop is there and there are people kind of making them understand making them aware of that there which is which is obviously awesome to see uh on that front and I think that when you talk about like the durable value acral of all of these things uh not just eth but other assets as well I've spoke about this a lot on the refi before but really the number one thing and I and I strongly believe this still to to today and I've talked about this a lot over the years on not only the refi but also on Twitter and just in the public fat the the strongest value of cruel property is to be a store of value and a money yes it's all well and good to have other functions like a staking asset or defi collateral or uh

you know fee Revenue generation so on and so forth but still if you want to have long-term kind of strong value acal in crypto and you can look at BTC as the perfect example of this you need to be a store value SL money and that is a longer term game that is a game that is very hard to win and very easy to lose people have written off eth at this point saying that eth has lost that game it's not going to be a story value money you know it's lost that to BTC but I don't think it's zero sum like that at all I don't think it's just one Winner Takes all because you could argue right now that there are plenty of store of values in the world multiple store of values especially at at like large market caps I mean gold is still worth

like what is it $20 trillion or something like that Bitcoin bitcoin's around 2 trillion eth is 300 and something billion right now um you know it can it's been to like 400 billion before 500 billion before so eth is not worth that because of its like fear of a new generation right it's worth that because there is a monetary premium baked in it is considered a store of value uh and and a money there so I think that we need to keep pushing on that as well as pushing on the usage side of things and fear Revenue generation that's all well and good things like Bas and Native rollups are going to help there a lot as well but just getting more and more people to build on ethereum just helps expand the network effect of eth as an asset and make sure that eth kind of keeps moving

towards I I've used this analogy before but like this barbell where essentially you have like two sides of the barbell you you have like the the rotated out Tech side on the left you have the store of value money play on the right and then in the middle is is basically everything trying to fight between the left and the right ethereum was at the left it moved to the middle it's in the middle right now it's still not towards the right side I would say it's like a pure store of value kind of money that's worth a lot BTC is pretty close to that at this point and then everything else is basically on the left still I don't think anything else is is close to uh even the middle at this point but that's the barbell that exists there and that's what I uh what I see there but anyway I

spent 15 minutes going on a little on a bullish rant there but there's just so many things to be bullish about guys and as you guys know if you've listened to the refuel uh I've gone through plenty of them in detail before so I wasn't able to list everything because I want to get through the rest of the updates for today but hopefully that keeps you bullish on ethereum all right so the Petra upgrade is coming and coming fast as you guys know the test Nets are about to Fork so we have the official dates here heski will Fork on February 24th sapoia will Fork on March 5th and the ethereum main net will Fork on in early April no exact date yet for the main net Fork but it will be happening on in early April there as estimated as long as the test

Nets don't like break or something like that as long as they're going well uh the forks will happen at at at these times so we're very close now early April is only what is it it's like 17th of Feb today so it's only about 6 weeks away from today six seven weeks until we have Petra live on mainnet we'll get that nice blob count increase we have the max EB EIP going live which allows staking of up to 248 e per validator which is going to be really cool especially for solo stakers we have the account abstraction EIP happening the other one that I mentioned the execution layout triggerable exits as well as like five or six other eips so as I've said in the past big big upgrade biggest upgrade in ethereum's history but going forward after Petra I think we're going to be prioritizing smaller faster

upgrades um with things that are critical because at this point in time I would say that pias is critical we need to get that shipped absolutely ASAP and I think we will but anyway those are the dates right now keep you guys updated when we get a main net date there so I mentioned this earlier but vitalic posted a new post or new blog post all about scaling L1 ethereum in particular the L1 gas limit here so you can go give the post a read for yourself I'll link in the YouTube description below but the tldd is that he believes as I believe as well that the having a higher L1 gas limit uh is is fine even in an L2 heavy ethereum even a rollup Centric road map world and it's funny because I saw a bit of reactions to this blog post from

people saying oh now ethereum is is is wanting to scale the L1 it's like no no no we've wanted to scale the L1 forever and you can actually find refill episodes from years ago where I talked about scaling the L1 but the thing is is that we need to do it in a way that doesn't sacrifice ethereum's core properties decentralization sensorship resistance credible neutrality permissionless openness everything all that sorts of stuff stuff right and the only way to do that is through thorough research and then and then getting to the point where you can submit kind of uh developments to both the clients and as eips in order to safely scale up the gas limit without losing things like solo stakers without losing abilities to run a full node at home on consumer

hardware and while also recognizing that this is only going to get better over time and I guess like light clients falls into this things like veral trees or The Verge part of the road map fall into this it's just that it's Tak a while to get there because it takes a lot of research and development to get to the point where we can do this stuff now we did have a recent um L1 gas limit increase to 36 million I believe post Petra we're going to have another one maybe to like 60 million that would be really cool to see uh but I think we can be more aggressive here and I think vac agrees with this that we can be more aggressive here on the gas limit front we just need to make sure that we're not uh I guess negatively affecting the network in terms of the full nodes on

the network the node operators generally on the network the ones running valid but also making sure that the network just doesn't fall over or doesn't degrade in network performance if we raise the gas limit here so doing it safely and securely is how we uh I guess keep ethereum uh as the world's best settlement layer because it is it still is the world's best settlement layer most secure most decentralized most reliable it has never gone offline I know some people will argue that the Shanghai Doss attacks in late 2016 constitute a livess failure and some other people will argue that high fees constitutes a liveness failure but I think that's just cope I think that's absolute to be honest ethereum has uh never gone offline the the the layer 1 network has never gone offline

it has 100% up time from Genesis which is insane when you think about it because not even web 2 Services can boast a 100% uptime ethereum can and that's due to the fact that we have an incredibly resilient Network and that's due to the fact that we've basically limited the L1 scale because we knew that just throwing more Hardware at it would mean that it became less decentralized and just concentrated in data centers that's not what we're here for that's not why we are are ethereum that's not what we're building we are building a network and this is Bridge into the choir I know but we are building a network that can be secure and reliable under any and all circumstances 100% up time is not the goal as well guys the goal is a secure and reliable and decentralized network

100% up time is just a really nice feature of that and also client diversity plays a huge role in that too it's what saved the network from going offline even in late 2016 with the Shanghai Doss attack and it is what will save the network in the future from going offline uh due to the fact that we have really really good client diversity across the network so no other network can boast this no other L1 even comes close to this ethereum stands alone here and it stands strong and we need to preserve that while also scaling up ethereum of course and that's what we're doing both at L1 and L2 I've talked about this on the refu plenty of times you don't need me to rehash it for you here but we are definitely uh doing that there all right so I mentioned blobs earlier and and a post that I came came

across from eth dreamer here or mark from the lighthouse team so Lighthouse is an ethereum client on the consensus layer here but he put together a short post basically giving a I guess timeline that he would like to see that is illust illustrative of what he wants to see here so essentially he basically said what I said before where he says that we should prioritize shipping smaller Forks especially around blobs and the post is titled decouple pias activation from fusaka so he's putting forward the idea that we should even do pias before fusaka which basically means just do a pias only fork but also do blob only forks and he calls them BP which I I think I think it stands for blob only

Forks or blob Fork only or something like that um but essentially his timeline is let's do a after Petra let's in June do pias and then and then let's get the 12 12 blob Target from the nine that sorry from the six that's coming in Petra so basically they're doubling there then in August let's double The Blob count again to 24 then in October with fusaka let's double it again to 48 and get eof as well and fossil whatever makes it into fusaka there this is what I like to see these timelines are only illustrative of his points these aren't timelines that have been discussed or anything like that this is not this is not something that uh is is going to happen or anything like that we don't know yet but the discussions have been started people I think have an appetite

for this I have an appetite for this we need to do this we need to scale up blobs massively from here and uh we can do this safe honestly there is no reason at this point why we can't do this and as I've discussed in the past obviously there are tradeoffs with things like requiring more bandwidth from our node operators but I think we've gotten to the point where we're basically like well if you want to build your own blocks you're going to have to have some pretty beefy uh bandwidth and some pretty beefy uh kind of access to bandwidth I should say because otherwise you're just Outsourcing your block building to me boost anyway which is what most validators do 95% of the network or already outsources their block building to the meev Boost network which are which are have Searchers that basically

find The M opportunities and then build the blocks there so in that world that means that we can have um you know we can massively scale blobs and we could potentially even Mass massively scale L1 gas limit too but anyway you can go give marks post a read for yourself I'll link it in the YouTube description below for you to do so all right another Milestone from the core Dev side of things here so there where was a two client devet that finalized an epbs Epoch uh over the I think this was yesterday um Poes says here this is still very early but it's a significant Milestone to celebrate uh This was done between uh te teu and prism client uh and this is uh there was a bug after this as well this was finalized but then it broke and epbs

isn't due to be included until probably next year I think it's going to be part of the glamsterdam upgrade but it's still good to see that this is happening here this is just awesome like the fact that we already have a defet that finalized even though it broke after it is great to see because it means that cevs are working on this stuff and really want to push it out there and then Terren who also works on the prism client quote tweeted this by saying uh here's your daily reminder that EIP 7732 which is the execution payload block separation EIP is the strongest implementation progress we have today for delayed execution it has an EIP consensus specs 16 breakout calls and now two clients finalizing a Dev net and he says they're going to make a strong push for this in faka as I've said I

don't know if it's going to be part of fusaka might be part of glamsterdam if we do pectra as part of its own sorry if we do pias I should say as part of its own fork and then do fusaka as a separate Fork to that then this could make it into fusaka because it means that we've already shipped pias and then faka has room for another headline EIP which could be this it could be this coupled with fossil could you imagine getting epbs fossil and eof which is still I guess like 50/50 on the table as well as a blob uh increase or as part of fusaka that would be awesome and and having P shipped even earlier than that as I said that would be awesome so we'll see I'll keep you guys updated on that one there uh but you can check out the

tweets for yourself we'll link them in the YouTube description below for you to do so all right a great tweet thread here from bingi today or yesterday I should say so basically he put together this thread uh calling out to wallets saying integrating EIP 7702 which is the account abstraction EIP that's coming a part of pectra uh it's a revenue unlock for wallets here because wallets don't make money on approvals they make money from users transacting and swapping and bridging etc etc but every approval prompt is a potential drop off point where users can get frustrated second guess a transaction or just abandon it altogether 7702 and removes this friction and just basically bundles everything into one and keeps it seamless so if you're a wallet that

hasn't integrated this you are going to bleed users to wallets that have integrated this so that means that it is a revenue unlock for for you because it it basically means that you're going to retain users you're going to get more users swapping and bridging and whatever with your wallet and they won't bleed to other wallets yeah so if you are part of a wallet team or an interface team or you know uh these teams tell them to integrate with EIP 7702 on day one they hav until early April to do it tell them to do this otherwise they are going to lose users to other wallets I know for a fact that I will not feel comfortable using a wallet not not maybe comfortable is the wrong word but I I I I I I would feel kind of shitty using a wallet that

doesn't have this integrated maybe not on day one but like maybe within the first couple of weeks of Petra going live and I personally would would switch over this I I switching wallets it's it's pretty annoying to be honest but I would do it because what's even more annoying than switching wallets is having to approve things like I I I really don't like approving things and not having the other features that come with 7702 such as gas sponsorship such as um SM uh the things that smart contract accounts gets like uh spending limits and stuff like that right I I I would would like to have that as part of my EAS so yeah anyway you can go read this uh tweet thread from bingi uh I'll link it in the YouTube description below for you to do so all right last up here so the SEC has

signaled a path to ending the coinbase lawsuit I have discussed this so many times on the refie before and I've discussed uh the fact that I thought this was going to happen once the SEC became Pro crypto because of the fact that Gary gendler is out this would be a massive win guys because it means that if the c ends their lawsuit against coinbase it's basically a signal to the rest of the US businesses building um you know in in the US or crypto businesses I should say that they're not going to get sued for stupid stuff like there are legitimate reasons for the SEC to go after companies for like actual Securities fraud for actual fraud for insider trading all that sorts of stuff but the SEC went after coinbase with

absolutely baseless accusations as well as others like Kraken and binance Etc and Unis Swap and consensus and so many others right um so for them if they do withdraw or end the coinbase lawsuit that means that everyone else that has been playing by the rules or at least not doing crime it should should be fine as well which as I said is a huge unlock for all of those businesses and it means that more and more businesses in the US will want to build in crypto and will be able to do that safely and this is just on the enforcement front we also have that crypto task force we also have better regulations coming and that will get at the heart and the root of the problem rather than I guess the Band-Aid fix of just hoping that you're not going

to get sued we need proper regulations in place we need proper fit forp purpose Securities laws and securities regulations around tokens and around crypto assets otherwise everyone is just still in the dark about things they may not get sued but they're still in the dark and they might be tiptoeing around saying is this actually okay to do and that's the whole point of actually putting in proper guidelines there but I think on that positive note that's going to be it for today so thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up sub got your newsletter join the Discord Channel and I'll catch you all on Wednesday thanks everyone