Censorship chat, Phantom supports Ethereum & Polygon - The Daily Gwei Refuel #497 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of The Daily gray refuel where he kept the latest news in ethereum ecosystem I'm your host Anthony 30th of November 2022 alright everyone let's get into it so a fresh update on the mevwatch.info website today to their censorship offenders leaderboard now what they've done is they've listened to our feedback and my feedback as well uh and now they've defaulted the offender's leaderboard to percentage of blocks enforcing censorship by each entity and if you go to the mevwatch.info website you can see this in action so you can see here the staking entity uh the total blocks that it's producing the amount of blocks that are censored and the percentage censored and you can toggle this as well so you can toggle uh a

percentage censored uh or I guess the toggle's not really working for me right now oh yeah okay no you can toggle between the two here so basically this shows you the amount that is censored with the entity producing the most amount of blocks uh it ordered by the amount of blocks and this shows by the percentage of their blocks that are censored so you can see here staycounter cream Finance at ether capital and Ledger live which are big staking entities are all 100 censoring so that's obviously uh very uh disappointing to see in terms of well-known names you have binance and bitfinex CR both uh over 90 percent uh Lido is at 79 cracking at 75 and then you can keep going down the list right and and on the bottom you've got two

entities that are at zero percent uh kucoin and vitalik of course vitalik is at zero percent I'd be pretty disappointed if he if he wasn't right but yeah he's there at zero percent which basically just means that they're not using censoring relayers if they are running Mev boost right so yeah this is a welcome change here uh but also I went on to the mevwatch.info website uh today and I noticed that we're back under 70 uh info enforced ofac compliance on the one day time frame now I've explained before that you can't just look at one day you have to look at longer periods of time so if we change this to seven day it's still at 72 percent 30 day is is at 72 as well but I mean as I said the other day I didn't want to call it too early but it seems that we've kind

of topped out at around 70 75 percent and the trend is coming down and you can see the reason uh over the last days because uh if we go and sort by um the relays themselves uh block shot Max profit cracked the 20 uh adoption barrier and flashbot is under 70 itself now obviously flashbot is not the only relay that he's censoring but that's the big one right so we're getting better relay out diversity and I would also say it has to do with uh what um flash plots the the research that flashbots released the other day where if you set your minimum threshold to 0.05 eth on your um on Mev boost even if you are using censoring relayers uh most of the time or I think a lot of the time I don't know about most but a lot of the time

you're going to produce blocks that would not have censored anything uh because they're not high value blocks so that's obviously a very welcome change that is probably played out in this as well as well as obviously the um relayer competitive land Escape being a lot better I'm expecting more relayers to come online over time as well and obviously Mev watch.info will add them to their website and you can see in the chart here as well this this playing out if you include all blocks you can see basically what it looks like uh but then if you untick include all blocks which I think is better you can see the green is increasing with the red decreasing over time obviously green is good red is bad there so yeah we're reversing course it seems and as I said I don't want to speak too early but if this continues we

uh we are um we are having a really really fun time here and reversing course uh which is awesome to see and I've explained before how tackling this issue of censorship on ethereum is not a kind of it does not have a one size fits-all solution it's not just a singular thing it doesn't it's not like we're just going to get PBS and CR lists then everything would be fixed and obviously those things aren't coming for a while so what could we do in the meantime well there's been plenty of things that we've done in the meantime right we have I mean first of all we have a website to actually track this stuff that's incredibly important including goes to the laborious team for building mevwatch.info we need better relayers or at least better I should say better relay infrastructure and better relayer landscape and that's what we've had

we've had more relay spin up we need uh everything to be open sourced as part of the Mev boost Suite which has happened flashbots has open sourced everything they did the Builder the other day which is the last piece that they needed to open source we have the additional stuff like flashbots's research that they published the other day about setting that minimum uh kind of uh uh block profit threshold I think it was called uh and maybe I'm missing some stuff here uh oh well I guess like something that's not live yet but that will come becoming relatively soon is staking staked withdrawals which is obviously very important so people can change who they stake with because if you stake with a centralized exchange and they are using censoring relayers well you can exit but there's kind of a discount right now on that so if you were to exit you would

take a bit of a haircut uh and if you're staking with a centralized provider it doesn't give you an LSD you may be wanting to wait till withdrawals come out so that you can withdraw and go with someone that's not censoring or maybe you have enough eat now that you want to solo Stakes so you want to basically take your eat out uh and go solo stake it without taking that haircut as well and obviously solo steak and not contribute censorship to the network so there's lots of different things at play here and I am more hopeful than I've been I mean I've always been pretty hopeful that the ethereum community will will solve this issue but the thing is is that it's kind of funny because it hasn't been that long right it's August 8th the sanctions came into place and then shortly after that the relay has

started censoring and then we had this massive very quick growth of censorship on the network uh and I guess like of tornado cash censorship and you can see here this tracks back this chart to September 16th so about you know five weeks after the sanctions came out uh and the adoption was very very quick already and then you can see here of of the Mev boosted um uh relays on October 27th which is just over a month ago 97 of them at work quote unquote oh fat compliant which means 97 of the relays were censoring now if we look at what it looks like there's only 77 percent that is censoring of the relays this does not include all blocks this just includes Mev boosted blocks so the three layers themselves and the trend is down here so

I mean it's just been great and it's and it's given me a lot of hope that the ethereum community can really come together and solve this issue uh without needing to even change the core protocol right because there's been no core protocol changes yet that affects this this is all stuff built around the protocol that does not require the lengthy process of the EIP process and then the governance process and then they're getting it included in the network process like that's all very lengthy so we're doing a lot of things around that and I will say that funny enough when all is said and done and when the ethereum network implements all these Solutions because there's still plenty more down the pipeline when these things get better when we do things to also um make it make it through a more private make it so that Mev uh we we get

rid of as much mov as possible ethereum will be a much stronger and much more censorship resistant Network than it otherwise would have been if not for the ofak sanctions as I've always said the ofax sanctions are a fire under our ass to get our together to make sure that ethereum is actually censorship resistant and as I've also said plenty of times the censorship is really a consequence at least right now of Mev boost right of of sorry of Mev I should say and Mev boost enabling it via relayers to to centralize like this right but the problems of censorship on on ethereum have been I mean on blockchains in general have been known for quite a while and ethereum is doing a lot to build uh on that front not just for the Mev uh uh I guess um Mev context

but also other contexts that could rear their head in a rear their ugly head in the future so great to see this but uh but yeah hopefully this trend down continues I'll be watching this closely if we can get under 50 relatively soon that'd be awesome I'll obviously we want to get to as close to zero percent as possible I don't think we're ever going to get to zero percent again like as long as relays exist it's going to be very hard and also you can never really prove that it's zero percent or a hundred percent even these numbers are estimates because you can't really prove things you're basically taking the word of the um of the relayers uh and I mean if they're not open source then you have to basically trust that they're telling the truth right uh and I mean you can

test if they're if they're um if they're censoring or not but you can't sorry if you can test if they're censoring but you can't really test if they're they're not censoring obviously because your transaction will get included you can test if they're censoring by sending sensor transactions and then watching if their relay are if it has enough uh kind of market share uh uh to to get picked up sort of thing uh actually senses that and then you you know you can test that so it's always estimates it's never going to be exact but it's pretty good and as I said a huge kudos to lab risk for building and maintaining this website it is a very valuable community resource all right John Wu from Aztec Network had a great little tweet today that I wanted to talk about so he said FTX block 5

Voyager Celsius these are not crypto failures these are failures of basic operating principles and corporate governance enabling financial mismanagement and malfeasance at massive scale this point is so great because it hits the nail on the head these centralized services are not crypto right when we talk about crypto we're talking about the actual networks and and the actual kind of like decentralized networks that are powering all of this FTX block 5 Voyager Celsius all these T5 companies they run on centralized databases there is literally no difference between them and Banks and uh financial service providers and stock brokerages and Prime brokerages and all

that sort of stuff there's no difference there at all in terms of the actual centralization in terms of the business practices that they have to adhere to the regulations all that stuff right the key difference is that these entities hold crypto or this majority of crypto instead of the Trad fire assets right uh obviously they hold a lot of currency as well like uh like Fiat uh uh sorry like US Dollars and Australian dollars and other such things but they are not crypto when we talk crypto we talk about like the ethereum network and D5 and nfts and all that good stuff we're not talking about these C5 institutions because as John says here the reasons they failed was because of the Trad fire world because of the meat space world not because of

crypto defy has its shortcomings and you know there's not much true defy out there in terms of like actually being properly decentralized but and this and obviously the problems with D5 come in the form of of hacks as well but they are actually crypto that is being built on chain it is not regulated by I mean the stuff that happens on chain is regulated by the ethereum network it is not regulated by the a third party it's not regulated by a nation-state or a government the ethereum network regulates what's built on top of it what's built on top of it has to adhere to the ethereum Network's rules and that's that whereas FTX block 5 Voyager Solstice and all these other C5 platforms they don't have to adhere to any network rules any crypto Network rules at all right obviously if they want to transfer crypto in and out they

have to follow the rules of the network to do that but in terms of actually operating as a business they are not regulated by the networks that they support they are regulated by the nation state that they are part of so coinbase for example and coinbase isn't obviously part of this list because they're good actors and they haven't blown up but coinbase is regulated by the US right by the US government by the financial Regulators in the US they are not regulated by the ethereum protocol the ethereum protocol can't go to coinbase and say hey you're not allowed to do this because it goes against our rules that doesn't happen right in in the only entity that can go to the coinbase and say you know not allowed to do this is the US government because they are the ones that regulate them so I think this

is a very very big distinction that needs to be made and needs to be shattered from the rooftops especially to mainstream media who may not understand this is that these things have nothing to do with the crypto technology they support crypto in their own ways of course they use crypto they may interact with these networks themselves as entities but I've always said you can actually think of these entities if you want in simple terms as just like an individual right you can think of FTX as an individual yes it's obviously not an individual but in terms of the way they act in terms of who they are it's the same thing I as an individual can use the ethereum network FTX as a company or as a former company can can use uh the ethereum network in the same way they can do the exact same

things I can do on the network as long as they follow the rules but FTX is a big ass company that was a big house company right that was supposed to be regulated by all these things and supposed to be managed uh by uh by people who knew what they were doing and supposed to adhere to corporate principles and all these sorts of stuff and they didn't do that because there's actually no way to force that in terms of like enforcement there's no way to actually force that enforcement whereas on chain there is on ethereum you cannot break the rules of the network unless you take over the whole network right that's the whole point of decentralization is that on ethereum I can't go and say okay well I want to give myself 108th out of thin air right for doing nothing I can't do that that's

against the rules of the protocol the only way I could do that is by convincing the rest of the network to actually credit me 100 eighth of my account which will require a hard Fork to do that because it's in a regular State transition and I would basically get that free eth but that's not going to happen and for obvious reasons I'm not going to detail why whereas we saw what happened with FTX they took customer funds they did whatever they wanted with them and that was that I can't go and take anyone's funds I can't give myself anything I can't unless there's a bug in a smart contract I can't hack that smart sorry I can't just like go to that smart contract and withdraw funds that are not mine right right so from that perspective and the difference I think is pretty big and I'm

glad John would put this tweet out but I could go on about this for a long time but obviously I won't because I've got other things to get through but I just thought it was something worth uh speaking about today all right so Sigma Prime has a new blog post out today uh titled optimizing attestation packing so satalia uh helped shared new light on this difficult optimization problem setting the course for the next phase of block production now for those of you who don't know Sigma Prime are the developers behind uh the lighthouse ethereum consensus layer client so they know what a thing or two about attestations on the beacon chain here and things like attestation packing if you want to see the results and read the everything got to do with that you can in this short blog post here which I'll

link in the YouTube description below but I just wanted to put this on your radar if you're interested in ethereum staking and getting into the weeds a bit about that and how the beacon chain Works under the hood this is definitely the read for you so I'll link in the YouTube description below for you to check out all right so patches here from the rockable community put together a thread titled The Rocker pool rescue node so patches starts off this thread by saying after the merge uh palpers I don't know how to say this again with the mispronunciation of things uh presidently set up a spare Beacon node to allow rocketpool node operators to have a fallback while the client teams race to fix stability issues the node is behind a cloud Fair proxy and engines instance the former provides it with reasonable protection against Adidas

attacks and the latter allows him to inspect inbound traffic and prevent Mev tips uh Mev tips theft access is limited to smoothing pool members access URLs are given out ad hoc since then we've been iterating on the design and are now developing a self-serve rescue node service any rockable node operator will be able to request a temporary credential and a veil of a fallback while doing pruning maintenance this is really cool uh so I mean you can read the rest of this thread I'll link it in the YouTube description below but for those of you who don't know as a rocker pull node operator you have the option to set a fallback client pair so if anything happens to your clients and you obviously sent offline because of it and your local clients you can have a full back pair uh that basically kicks in when that

happens now you can have your own or you can use a third party and that's the whole point of this rocket pool rescue node service but there are a uh I guess like a bunch of um issues with that such as potential theft of tips and Mev and also centralization concerns which is what is um what is discussed in this thread here but they also answer the question like is this trustless and as Patrick says no to be very clear you use it at your own risk you are trusting the maintainers not to attempt to steal your tips mov while using it however your keys stay in your custody the entire time and the maintainers will be publicly identified so this is another thing for you to I guess um use if you are a rocker pool node operator if you are fine uh kind of trusting that these

operators are doing what they say they are doing as I said it's not trustless they explain that here the thread you can check out for yourself but I think these kind of community tools are always important to highlight because it does add to a guess decentralization in its own way even if it's a centralized service and it does add to the I guess some social cohesion of a community like rockapool where they can basically be like hey you know this this we've got this cool rockable rescue node service that you can use if you want to use that it you know it adheres to the ideals of the rocketpool network and their principles of it the the people running it uh you know a rockable maximum so to speak so go and you know check this out obviously it's not trustless but it's still something that that you can use

and it's completely optional as well so yeah as I said I'll link this thread in the YouTube description below for you to check out all right so Ryan berkman's here posted a dune uh chart that I think I've highlighted before which is the percent gas spent by L2 proof contracts of the total max daily available ethereum gas now I haven't checked this in quite a while but it is growing and I'm not surprised that it is growing because l2s are growing so you can see here that since July 2021 uh when I guess activities activity started picking up in Earnest you can see here that the percentage of gas used by these L2 proof contracts on L1 was very small and just eyeballing it here it was maybe 0.1 of of gas used on on the network now since

then it's been about 18 months and we're up to basically over four percent as you can see here uh recently right so in 18 months we went we went from basically from we went 40x essentially now we're not going to go 40x from here obviously because that'll be more than 100 uh uh but basically this is what's expected of the ethereum network over time to become more and and more just block space for l2s now as Ryan notes Here the chart below should continue growing steadily until 4844 goes live at which point l2s will uh switch over to using the new block space and we'll have scaled 100 times overnight so obviously this isn't going as Ryan says here this is going to come down a lot because of 4844 but I

don't think that means that the growth has stopped or anything like that people are just going to have to adjust the way they look at the look at this um chart and look at these metrics in order to account for that but still this is just absolutely amazing and I've had a lot of questions lately around ethereum block space and people asking and they've been asking this for a while but they're asking it again you know will L1 block space just be you know too abundant and we'll um will l2s not replace all the block space that isn't being used by people on L1 and will we actually have you know a lot of fee burn will it will it be negligible I think there's always going to be on people on L1 for one reason or another at least for a very long time

um you know for 5 10 15 years I think people are still going to be using L1 I think that the fees are still going to go up during periods of volatility there's still a lot of liquidity on L1 there's still going to be I mean l1s are still going to be the most trustless and decentralized place and most censorship resistant in place funny enough uh for you to do your transactions on uh for the foreseeable future as well uh and and I think just generally there are a lot of players who don't care about the fees even if the fees are like 100 150 or something like that per transaction they don't necessarily care about that and then also if you know L true's goal is as big as we think they are going to grow they're going to eventually use up all that additional block space that

they're given and we're going to have to keep scaling that's why 4844 isn't the end of of scaling it is really just the beginning of scaling layer one where we add that Proto dank sharding in and then when we get full dank sharding which probably won't come for a few years still uh that adds even more capacity and other things that we're doing with vertical trees and things like that as well and potentially even in just increasing the L1 on block side is generally which would apply to to all of dang shining that all coming together I mean I really do think that we're going to have enough Blogspot block space for for quite a while but I also think that with our ones uh sorry with L1 people are still going to use it for quite a while as well so yeah it's kind of like uh they were going to use

both for the foreseeable future but if you're asking me what the space is going to look like in even you know 10 years even though I think they're also going to be using L1 I mean the vast majority of people will be on l2s that's just the way ethereum is being designed and not just l2s l3s and and higher layers than that right people are going to be sitting on there doing their stuff a lot of people aren't even going to be aware of what a gas fee is because the uh the layer that they're on will just be paying that for them and taking fees elsewhere and monetizing elsewhere so yeah so thanks to Ryan for highlighting this chart today it's something that I hadn't looked at in a while but very interesting to see that it's growing all right so I think we have the biggest

announcement of the last 24 hours to cover now which comes from Phantom so phantom for those of you who don't know is a wallet on Solana now people have been big fans of this wallet for quite a while uh it is uh it has a very good UI ux I've seen a bunch of videos on it uh I've gone on the website and checked out all the various things that they offer and all their their um features and things and it's a browser extension wallet and it is a massive step above I think metamask and I know that's not necessarily hard to do but considering metamask is quite rough around the edges and I've explained why in the past I think that they're just sticking with that and just be you know sticking with being the most reliable and robust uh and secure wallet rather than going with

all the fancy features which is totally fine but Phantom and the reason why I'm talking about them is not because they support Solana but because they announced support for ethereum and polygon POS chain today so this is a huge announcement because as I said like they've been on salon traditionally and now they're embracing ethereum and the polygon POS chain and they're probably going to add support for other other chains or in the ethereum family like the L2 chains and potentially other side chains as well uh which is which is obviously a very big deal now I do want to say one thing here uh that Phantom is not open source now I this is why I haven't used it myself um the phantom and and why I won't use it even though they've got ethereum and

polygon support here it um the fact that it's closed source is a no go for me our wallet in my mind cannot be close Source like I just I I kind of find it insane that people would use a closed Source wallet but I mean I understand why it's closed Source I mean one they obviously want to protect their what they've built but that grows completely against the ethos of the of the ethereum community but at the same time they're coming from Solana they're not coming from ethereum so in Solana actually a lot of things are closed source so it's all about an ethos and principles thing now with with Phantom on ethereum and polygon now we can push them to open source and whether that works or not I don't know but we can keep pushing them and keep saying you know we want to use Phantom but we

want it to be open source this is ethereum we like things open source and as I said whether they do it or not up to them but I personally won't be using it because of that now I want to also say that just because it's closed Source doesn't mean there's anything nefarious happening but if I don't know and I can't look at the code myself and I can't get my friends who know how to read the code to look at it and other people can't audit it freely I can't trust it I can't trust it with any of my money I can't even trust it with their pass through using my Hardware wallet um and and I think that for me is just a I guess like a binary thing like you're either open source or not even if you were like uh Source uh viewable where

you're not open source in that people can't you know copy your code and can't use it but your Source viewable where I can actually see the code uh and read it myself and and be able to tell what it's doing and other people can do that as well and point out if there's anything dodgy going on I think that would be you know just just fine like I it doesn't need to be like full the open source it just needs to be Source viewable so that people can verify that but yeah I don't want to hop too much on about that I think it's just really great that they're expanding to ethereum and and polygon are not just staying on Solana because you know metamask it's funny because metamasks expand they didn't really expand to other chains because you could always add your own RPC on

there and metamask is really just like an evm well when you really think about it so it's going to be interesting to see if they announce support for Solana I don't think they will to be honest I think that menomone is being backed by consensus and consensus being owned by Joe Lubin who for all intents and purposes and if it would be an ethereum maximalist because he is an ethereum co-founder um yeah I just don't think metamask would bother working on Solana support especially if since Solana already has Phantom and I think they have a bunch a bunch of other wallets as well and also I mean if you're in ethereum you kind of don't believe that Solana is going to be long-term irrelevant anyway so yeah I mean I don't know I don't speak for the minimize team but uh yeah still very cool to see their fan is supporting

ethereum and the polygon POS chain here don't let my comments around it being open source or not dissuade you from using it maybe you just use it for low value things maybe you just use it for nfts uh everyone knows they're worth zero these days because all the nfts went to zero right but no seriously uh just be cautious of that I think that's just a warning just be cautious that uh it's closed Source not open source but again that doesn't necessarily mean it's bad it just means that you can't actually see what they're doing um but at the end of the day the companies docs the people behind it are doxed uh if they do anything dodgy I mean I'm sure it'll be illegal but we all know that even if they're docs then what they do is illegal doesn't necessarily translate to anything useful

for you but because one SPF is still out there uh two they're uh he had all the funds and he lost all the funds and three people that had their funds on FTX may not get back anything if you know maybe they'll get back like 10 of what they had on there so when you when you think about it like that that's why I think it's very important to make sure that things that you're using as secure and open source all right so an update from stockwest they've said stocknet mainnet Alpha has been upgraded to version 0.10.2 expect an improved TPS in the upcoming stock net versions with sequence of parallelization already deployed on mainnet a new rust implementation for the Cairo VM and SQL re-implementation in Rust and you can

see the these blog posts here titled stock net performance roadmap with a tldr that says validity Roll-Ups are not limited in throughput in the same manner as l1s this gives rise to potentially much higher TPS on L2 validity Roll-Ups uh stock net performance roadmap address is a key element in the system the sequencer we present here the roadmap for performance improvements sequencer parallelization as I just mentioned I mentioned these things just before and proofers being battle tested as they are and not the bottleneck and can handle much more than they do now and then then they go into detail about how this all works so if you're interested in that I'll link this YouTube uh yeah I'll link this blog post in the usual description below for you to check out all right so Beacon chain has added a few more bits of data to their website

here so they say slowly but surely you will find more execution layer data on Beacon chain mempool view pending transactions gas now slash 1559 burn execution layer data on the validator page and more so you can see they've added them here to uh sapolia which you can check out uh so poly here is the test now I don't know if this is live on a mainnet yet uh it may not be I don't think uh yeah I don't think so but yeah they're just adding more and more information here that you can use to view things as they as they kind of happen here so yeah go definitely go check this out I'll link it in the YouTube description all right finally we have an announcement out of Lyra today just a disclosure here that I am a Lyra a investor uh as well but yeah I mean they

announced today that they've raised an additional three million dollars from framework adventures and GSR this will serve to diversify the treasury and bolster the long-term resilience of the protocol as the primary source for options liquidity in D5 now for those of you who don't know Lara is an options protocol on optimism uh and they've been uh they're part of the synthetics ecosystem they've been around for a little while now uh but yeah congrats to them on this raise very cool to see them raising in a bear Market as I said guys like just because the bear Market doesn't mean teams can't raise and if if they uh they want to raise if they want to get some money under the belt to increase their one Runway then this is uh the way that they can do it so yeah I mean uh good on framework Ventures and

GSR for backing this team here I mean as I said I am an investor in them I know them uh their fellow Aussies and I really think what they're building is is super cool I'm not someone who plays around with options myself but I know that they're very popular in C fi so let's bring them to day five right let me at the end of the day we're not going to get people to go from C5 unless we build more compelling things in D5 for them to use and and things that are actually on par with the C5 offerings in terms of like obviously speed scalability fees but also uh giving the additional benefit of things like self-custody in especially in the wake of the FTX collapse so congrats to Lyra on this raise but I think on that note that's going to be it for today so thank

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