Coinbase vs the SEC, Blobs going crazy and more - The Daily Gwei Refuel #755 - Ethereum Updates

Transcript

hello everyone welcome to another episode of the delway refuel where up the latest news in ether acos system I'm your host and 28th of March 2024 all right everyone let's get into it so another crazy 24 hours in the ethereum ecosystem a bunch of stuff to get through today but just wanted to kick off today's episode by uh kind of pointing out that Fidelity has filed their S1 for their eth ETF now you can see here James ccii basically put out this tweet uh with the um with the filing of the S1 now for those of you who don't know the 19 b-4 was already filed for Fidelity ethereum ETF but the S1 is the other form they have to file and I believe that most of them have filed this form now there's a table here from James that basically shows that uh

them being the ETF issuers or the prospective ETF issuers they've filed their 19 b-4's and the prospectus which is the S1 has been filed by everyone except Hash Hash deck uh um which is only one of the issues here but the rest of them have filed that so they're all basically up to I guess like scratch now um I think that they still include staking though uh these things and as I've discussed before on the refuel when it comes to staking in these e ETFs I don't expect them to actually be uh you know be approved with staking on there but it could be as simple as the SEC asks the issue as hey uh can you just remove staking from this and then we'll basically approve the eth ETFs here so yeah but I mean you know it's not huge

news obviously it's just a kind of formality that Fidelity has done here that every other issuer has done but I think it just signals more and more that these issuers are not giving up on these ETFs right they're still kind of putting in their applications putting in their their kind of relevant forms that they have to so there is still obviously a chance that these things are going to get approved on May 23rd at least the issuers believe this and I'm still at you know I think they're going to get approved by May 23rd but as you guys know by mid April if we don't really see any movement between the SEC and the issuers I would pretty much lose you know most of my confidence in them being approved on May 23rd just based on the logistical kind of side of things the paperwork side of things but one thing I

do want to bring up as well here is something that I've spoken about before and I won't spend too long on this because I know I've spoken about the ETFs a lot on the refu obviously but just one thing I want to want to kind of uh clarify and highlight here is that leading up to the BTC ETF I mentioned that the SEC regretted how much of a circus it became because it wasn't just all of the I guess like attention that they had on them throughout the whole process I think that the bulk of it was like the three months leading up to the F being approved there was a lot of attention on them a lot of attention on the back and forth and basically creating the circus out of it right up until like the day before they got approved when the SEC account was uh a

Twitter account was hacked and obviously posted that the BTC ETFs would be approved and that was one day before Jane 10th before the actual approvals here so I think that the SEC was embarrassed by that of course and they also hated how much of you know a circus it became how much attention was on it so there is an argument to be made that the reason that their violent isn't necessarily because they're going to deny these things um but it's because of the fact that they just don't want to put much attention on it because they regretted how much attention was put on the BTC ETFs now I know that may sound a little bit tinf fall Hatty but if you wanted some kind of I guess like proof of this I think Hester Pi in her um in her kind of uh I guess like uh post

after the the BTC ETFs were approved she actually explicitly called this out and said that she was really disappointed with how much of a circus this process had become so I think that you know it's not just a tinf hat conspiracy theory to believe this it really does make a lot of sense to me so but as I said like there is I guess like need for back and forth between the SEC and the issuers just based on Logistics and I think that they can only avoid the attention for so long because there are so many people watching this right now there's so many ey eyeballs on it CP that people are generally very loud obviously you know uh uh Larry thinkink is doing things like putting sorry Larry Fink and black rock I should say is doing things like putting uh their you know their new kind

of tokenization funds on ethereum so there is a of uh I guess like noise still being made but maybe the SEC just doesn't want to contribute to that uh you know unless they have to which could be happening in the next couple weeks so we'll have to see how that one goes there but speaking of Black Rock and Larry thinkink uh Larry actually went on Fox I believe yesterday I did a video interview here where he gave a few notes on a bunch of different things and Evans 6 here on Twitter uh basically I guess summarized his notes so Larry believes that the market is not currently in a bubble I believe he's talking about every market like the stock market Mar you know crypto markets whatever what have you not just the crypto markets uh he said productivity is increasing most companies seeing positive earnings

momentum is optimistic on this new type of drug uh it takes a long-term view as always uh and then he moved on to making comments about crypto where he said very bullish on the long-term viability of BTC I mean of course he's going to say that he has a product to sell like even if he wasn't personally bullish on BTC right he wouldn't say he wasn't because he has a product to sell and and I bit um Black Rock BTC ETF is doing very well right now so he's not going to say that he's bearish on it so take that with a little bit of a grain of salt and then he was also asked about the eth ETF uh and then he said you know we'll see if it gets approved or not and he's not worried about the SEC now some people kind of took issue with him saying you

know we'll see here and they basically said oh well that's Larry thinkink saying it's basically denied which I thought was strange because obviously he's not going to go on national television and say that he believes that the yes it's going to get approved or no it's not going to get approved because that that's Market moving there right so he's not going to open himself up to any criticism around this so really that was the only thing he could say we'll see cuz we will see right he's not going to speculate openly on National Television about this and then also there was uh more talk about Ethan uh Evans says here uh he you know Larry isn't worried if the SEC labels ether security because there he thinks that there will still be an eth ETF uh you know you can still have an ETF and that's obvious because

you know Securities have ETFs I mean being a security seems to be this thing that people hang over crypto assets as if it's going to be a death now and it's not that's the thing you know I don't believe ether a security let me make that point clear obviously it's a commodity you know and and I guess a lot of uh there a lot of arguments to to be made there around that but in terms of like other crypto assets being Securities there's not an issue like there's no issues with that but the problem is is that the SEC has not given any path for these assets to register as Securities and every time their teams try to do this or try to get clarity around this you know teams like coinbase as well the SEC basically stonewalls here so that is the heart of the issue

the issue is not that you know these things can be classified as Securities because if you want to look at Securities laws uh the way they are written today they're not written with I guess like crypto in mind but the way that they're written today in the US and the how we test and all that right A lot of these things definitely look like Securities I I think and a lot of that the way that they're kind of distributed to um to various participants looks like you know Securities transactions but there's nothing wrong with that but where the SEC takes issue is that they're unregistered you know they want people to come in and register all of this but again the problem is is that they've given no path for crypto companies to register and they've been so hostile that crypto companies don't even want to try to register and don't

even want to go through all the Hoops that the SEC is going to put them through so that is the heart of the issue the issue is not that these things are going to be labeled Securities because the stock market they're all Securities and the stock market is absolutely massive not just only in the US but everywhere else right so something being labeled to security is not a negative thing it actually is a positive thing I believe for for for a lot of crypto assets if there was a path to register here because it would mean that they would have a faster track to getting things like ETFs to getting uh integrated within the trafi system so really uh I think people have a very you know wrong view on on security on assets being Securities and how and crypto assets being Securities and how that

would be like really bad for the particular crypto asset it wouldn't it would actually be like fine I mean I you know I I don't think it would really change much outside of basically giving more access to these um assets for for users but obviously the issue becomes that for investors I should say but obviously the issue is that is the one that I just outlined but again I want to reiterate here that I don't personally believe that eth is a security I don't feel like it it satisfies the Hoy test uh at all really um and I believe that it is a commodity but even in the worst case scenario if the SEC wants to designate ether of security don't really know how they would do that I don't really know who they would go to for that like it's it's a mess right but if

they wanted to do that it wouldn't be any like a death now uh for for eth at all um but then the problem arises that while exchangers like you know coinbase and others who I'm going to talk about in a sec with regards to their case against the SEC are now trading in you know what the SEC deems to be unregistered Securities uh in eth but the thing is is that the SEC is already accusing coinbase of trading unregistered Securities and they listed a bunch of tokens off they didn't list eth but they listed a bunch of other tokens off so it would be the same thing here and coinbase hasn't hasn't the listed these assets because they're not legally obligated to do this unless the SEC was to win and and the court rules against coinbase um but for now while coinbase is still having that case with

the SEC they're not legally obligated to do that there um but yeah that's it on the Larry f comments and this is a perfect segue into the next thing I want to talk about today which was with regards to coinbase so I'm sure you've all seen this news by now basically the judge in the coinbase verse SEC case has ruled that the uh the um the case can proceed to Discovery and what that means is basically she didn't just like outright throw the case uh and that's what you know coinbase appealed and basically well not appeal but they asked the court like you know we believe this case is frivolous can you throw it out this was never going to really work I mean it was like a Hail Mary basically uh it was never going to happen there like the SEC brought their case against

coinbase and the judge agreed that the case that they brought against coinbase fits everything that it needs to fit in terms of like checking the boxes off so there was no reason to throw the whole case out and there was a good tweet here from Paul Grell Queen B's Chief legal officer which you should check out but to summarize basically what happened the judge basically said that the SEC can continue to go after coinbase uh or continue to kind argue their case against coinbase in court over coinbase Trading registered Securities and coinbase having staking products because obviously that was part of it as well but they can't go after them for their coinbase wallet and that was actually a huge win so the judge threw out the coinbase wallet portion of the case and basically she said that you know because the coinbase wallet is non-custodial and

because it is just a piece of software that coinbase has made for users to to use and it's got nothing to do with coinbase actually filling those trades within the within the wallet right for example and trading those assets it doesn't fit into the I guess guess like box of the case of what the case should fit into if the SEC wants to go after coinbase for these things here so that was great to see um but yeah as I said you can read poll's tweet thread and there's a bunch of other takes I'm sure sure you guys saw on Twitter there but I do want to give some of my comments here on this uh broadly like I'm not a lawyer as you guys know I'm not a legal expert or anything here but if I was to put money on what the SEC could actually win

on here I would say that they would probably win on the staking products and it's not just the E staking products but it's like all the staking products now the reason I believe this is because the staking product itself doesn't matter if it's eth or others can itself be considered a Securities transaction right or an unregistered Securities transaction here and the reason why they could potentially win on the staking product is because they if fits all four prongs of the hoe test now let's take ethereum staking on coinbase for example and let's take all the four prongs so the first prong is is there a Reliance on the efforts of others well yes there is because coinbase is doing all the validating work if you stake with with coinbase all right so that fits the first prong the second prong is that is there an expectation of profits of

course there is users who stake are expecting a yield AKA expecting profits from staking with coinbase okay so we fit the second prong now and keep in mind I'm playing devil's advocate here guys like I don't necessarily agree with this but I am playing Devil's Advocate to illustrate how the SEC could actually win on the staking product but lose on everything else so the third prong here is are these people part of a common Enterprise this one's a bit looser but it still fits where essentially that all of the coinbase stakers are part of the same staking pool because they're all part of the coinbase staking pool right then obviously not part of a common Enterprise being you know with ethereum because ethereum the network can't enter into a you know a legal agreement or any kind of agreement with anyone because it's just like a network Essen it's just

like a decentralized network of code and we of protocol rules but in terms of like arguing that there is a common Enterprise well there is because coinbase is running the all of this stuff uh and all of the users that are staking with coinbase are staking as part of that same infrastructure there the fourth prong is that is there an investment of money which again is a weaker prong but technically there is right there you need to buy eth in order to stake it now the fourth prong I think is like the weakest one here because you can argue and again I'm not a legal expert here but I would expect some of these arguments to pop up you could argue that there is no investment of money in the staking product itself users invest in E the asset then they use that asset to to stake they don't

invest in the staking product because for example if you were to invest in the St product itself you would argue that okay well you you buy coin to do that you buy a coinbase stock to do do that because you're deriving um revenue from the efforts of coinbase and all of their products whereas when you're buying eth uh you and then you stake it well the thing is is that you're buying eth the asset which has got nothing to do with coinbase it's a free traded commodity on on the open market um so the investment of money is for E the asset it is not for the staking product so I think that that prong is probably the the weakest one here as as well as the the common Enterprise but the other two are pretty clearcut to me but for something to be considered a security transaction or a

security uh product it has to meet all four of those prongs in the view of I guess like the SEC or in the view of a judge if people sue the SEC over there will take the SEC to court so again not a legal expert here but just my understanding of how Securities laws work and what the I guess like arguments can be on on either side here but in terms of like this case it is going ahead now to Discovery it's going to be years guys before this case gets resolved it's actually like super annoying how long this is going to be because you can imagine that you know in a couple of years time the ACC is probably going to look completely different to what it looks like today even in like a year's time like imagine uh you know with the presidential

election going ahead this year imagine the Republicans win uh and then Trump just fires gendler and then uh someone else comes along maybe they're Pro crypto maybe it's Testa that becomes the chief and she just withdraws these cases altogether she just withdraws the coinbase case withdraws the case against binance and Kraken and then we don't have to worry about this anymore more that that can happen like that is literally something that can happen uh within the next year or less which is just crazy to me because it means that que base is just wasting all this money essentially to defend these things when uh they don't you know they shouldn't have to but I'm glad coinbase is doing it because we need them to do this because we can set precedence in the courts we can get more clarity around things we can force the SEC to give

answers here but we know how the SEC is right they're not a not not a fair player here but yeah just wanted to kind of I guess bring that up there and and I think it's really a nothing Burger in terms of kind of news I was I was kind of puzzled that the market sold off on this given that there was no like win or loss for uh coinbase or the SEC here I mean there really was a win for coinbase if I and for I guess like non-custodial wallets and for Defi and for uh basically everything that we're building on chain because the judge basically said that well this has nothing to do with a centralized company this has nothing to do with coinbase so I'm throwing this out all together so that was the win that coinbase had here but in terms of the case itself it's just to

Discovery now What discovery is is basically you know all the lawyers get all of the stuff that they need to get in order to present their arguments all the information that they need to get in order to present their arguments for and against of course but if I as I said if this case goes through to when it actually uh you know finishes up and when it actually gets settled in the end I would say that uh it might be the case that coinbase loses on the staking product and that would mean that they would have to shut down their staking product like Kraken did for retail investors and only institutional investors would be able to access that or or accredited investors or non us investors of course would be able to access that product which you know I kind of look at and I know this might be

a little bit kind of funny to say but it might be positive for the beacon chain because coinbase is already such a large market share of staking it's like like 14% if they were forced to kill their retail staking arm just like Kraken was that's going to drop them down below 10% and and even lower than that and that was that's going to stifle their growth in the staking space here now I don't want the SEC to win on this but as I mentioned like it is there is a very strong argument that can be made here around this especially in light of the fact that Kraken even though their their staking product was actually distinctly different from coin bases but it's even in the face of Kraken that basically folded and and and basically uh killed their staking product without even going to court over it so it's going to be a

long drawn out battle we're going to get clarity around things hopefully it's going to be years of this but I'll keep you guys updated on how this progresses or it could be that if the administration changes and gendler's out this all these cases could just be thrown out alt together could be withdrawn by the and then we don't have to worry about this anymore at least that's my understanding of the whole kind of debacle here but anyway you can go give Paul's tweet to to read I'll link it in the YouTube description below for you to do so all right so this finally happened we had inscription spam on blobs so I think I mentioned this you know this would happen like at least a year ago on the show where I was talking about the fact that you know when blobs go live and

within like the short term after Blom blobs go goes live I expect there to be some kind of inscription spam because it's just something people love to do like they love their these inscriptions things and today we actually saw that happen on mainnet so there was a project that got spun up that was basically spamming blobs with inscriptions like uh transactions and you can see here Hill Dobby has a dashboard tracking this and blob prices just skyrocketed and we actually started burning eth uh from blobs you can see here that over the last day 58 eth was burned because of blobs which is still you know a relatively small portion of the overall burn but we hadn't had anywhere near this before and of course L2 fees went up and everything like that because of this but essentially it worked as

intended in terms of the the fee scaling here but what didn't work as intended was that there was a bit of network stability issues here and this was due to a myriad of different reasons but I believe the the main reason was that one of the relays I believe blocks route had a bug W uh with regards to I believe uh just something got to do with blobs I might I think I read that it had to do with the the kzg part or commitment part of The Blob so they had a bug where they were missing slots essentially missing blocks essentially which meant that Network Effectiveness came down but on top of that as well because of the fact that there was just like a rush of of activity into blobs I believe some of the clients hadn't really been optimized to deal with that yet and some of the

clients started missing attestations and missing blocks because of that so there was a bit of I guess turbulence on the network here and I actually woke up to to all of this I I looked at it and it was already resolved by the time I woke up but what's really cool about this is the fact that we got our first stress test of blobs today we actually got to see what happens when just a flood of traffic comes in to blobs we actually saw you know the fee Market work is intended and then the clients were able to gather some really great data in order to put out updates and a lot of them actually put out updates to their clients if you're a solar or home Staker or you run any kind of I guess infrastructure even if it's just a full node and no validators you should

definitely check if the I guess clients that you're using have updates because they're all updating they're all uh becoming more efficient they're all going to be able to handle blobs in a much better way uh which is which is great to see there now two com Ms I want to make here generally about things one this is why I hate that me boost is sidecast software because it essentially means that the core devs have real really like not great visibility over the software that 95% of the network uses and it has caused many issues throughout like the last couple of years since the merge in terms of uh Network stability issues right and uh this was an issue with the relays not with the builders and thankfully we are working on in shrining relays as part of the protocol as part of epbs so that's an

issue that we've already been working on uh which is great to see and then you know Builders I think we're not you know we're not going to enshrine those in the protocol we're essentially going to deal with uh the negative externalities of that like censorship with inclusion lists but that's all being worked on there but the second thing here is is the thing around um uh around the clients themselves right and around how the clients handle this themselves you know the clients were never going to be perfect from the get-go they're always being optimized they're always uh uh kind of being worked on and the fact that they have this data to work off now is is really really positive for them and another thing that falls into this maybe this is can be considered a separate thing here this is why I was generally against or at least rather

like not for increasing the gas limit right increasing the gas limit from 30 to 40 million at least over the short term um and I mean there was multiple reasons why but the the the number one reason for me was Network stability because we had just put an effective gas limit increase live on the network with blobs and I wanted to see blobs stress tested more I wanted to see the clients optimized more before we just put even more load on the network with the gas limit increase and honestly if I had it my way um I would rather we just wait until we have like uh EIP sorry the max EB EIP in to the network before we raise the gas limit because the network is already I'm not going to say struggling but it has so much load on it right now and I don't

want to lose you know the smaller stakers is out there there's smaller validators out there there smaller home node operators out there just because we want to increase the gas limit from like 30 to 40 million which in my in mind as I've explained before I don't think really is going to do anything material for users I think we should be definitely focused on the two side of things but I'm all for increasing the gas limit after we you know deal with these issues and after we have a more stable Network here and after we have the maxb EIP in on top of the fact that you know we're going to be able to increase the gas limit like orders of magnitude once we have vericle trees and state expir and statelessness so there are paths to get there but the thing is is that ethereum needs to optimize for

Network stability and reliability because ethereum is a chain of chains it is not just one chain anymore it's not just ethereum L1 it's ethereum L1 plus everything else built on top the layer 2 and the layer 3es and whatever else we need to make sure that ethereum layer 1 remains reliable always online 24/7 up time for those chains because that is really the key value prop here of of the world settlement layout right and nothing really negatively happened today besides a few Miss block blocks and Slots here um and and attestations with the network today there wasn't a lot loss of finality um I think that the it almost got to potentially a loss of finality in terms of network participation because of the fact that we had those issues with the the relayer and and the client issues generally um but this is good this is a really good

stress test today so if you want to check out some more information about this you can check out Hill Dobby's blobs dashboard to see what it looks like on the inscription side of things and you can also check out the ultrasound money website uh with regards to the The Blob burn uh here all right speaking of L2 fees base increased their gas Target uh from uh from uh sorry gas Target by 1.5x today to 3.75 megas per second so you guys knew this was coming I've been covering this on the refuel for the past uh week or so and as Jesse says here this gives 50% more capacity and you can see the impact to fees they started to sharply decline after the chains change and then they said we'll monitor through end of week then increase to 5 megas per second early next week if all looks well so this is

uh based obviously scaling their execution side here it's got nothing to do with data blobs themselves are separate to this but this is BAS basically saying okay we see all this demand coming in and we're going to increase our gas limit from uh 30 million which was uh I guess like um what it was to match main net and now up to 45 million and then finally going to I believe 60 million uh in in early next week there which they they're kind of like maybe maybe 50 million I think or or 60 million something like that but they're talking about it in like uh uh sorry it is yeah so it is 50 million and it's 37.5 million right now and they're talking about it in the respective of of Mega gas per second not not the gas limit here uh which is just a different

way of metering this here but you know this is great to see like I'm going to bring up the EIP uh sorry the grow the pie EIP 4844 cost tracker here you can actually see this if you go to these trackers go to Erp 4844 I'll link it in the YouTube description below you can see what the kind of fees look like on an hourly basis so if I just get rid of like everything except bass just to give you an illustration of what this looks like you can see here that there is spikes in bases fees a lot just based on like I guess meme coin Mania and stuff like that but you can see the other day their fees spiked up you know massively right but these are just I guess General spikes of of of traffic it's not like the norm but the norm was like higher

than average fees was like what you know 20 to 40 cents for kind of um the average fee here but then once they scaled up you can see that this has dropped down again so it's basically dropped down I think uh to about 20 cents and and below here uh which is great I mean it's obviously uh uh going to come down even more than that you can see that the median transaction cost is 3 cents whereas the average is 20 cents but that's that's come down from where it was there which is great as and as I just mentioned base is going to be scaling even more early next week they're going to be increasing It Again by 50% increasing their um their gas limit here now while I've got this kind of chart up here I do want to discuss something that I've been thinking about

a little bit now it's an analogy that I want to use that isn't exactly kind of I guess one to one or isn't the Perfect Analogy but I think it really is is a great way of explaining this stuff to people who may not be familiar with how I guess like onchain uh demand metering works so let's just take a website for example so have you ever gone to a website that's being hit with a lot of traffic at once and then you're put into like a queue of sorts by their dos protection like Cloud flare for example right right uh and then you may not get into the site immediately but you have like this Cloud flare page that pops up and basically says hey you know you're in a queue essentially and we're going to let you in in a moment and it usually

doesn't take long but it's there but then there are other examples of well of of websites that if you're buying a ticket for example or for for a show and there's a lot of demand for that they'll put you in a Quee essentially for that right and then they'll have things going on in the background to make sure that you know you're not able to spam you're not overloading the servers stuff like that and that will typically be something that exists on a different server to where they're selling the tickets from uh at least from my understanding of how it's done in web 2 now if we take this to web 3 obviously because we're in the context of I guess like Financial transactions we met and and we're in the context of of having a you know a distributed Network we meter these things not by traffic uh uh

because we don't have a centralized way to do that we meter them with fees so essentially obviously the way it works on ethereum L1 is that there is a minimum fee that you have to pay and then as the gas limit gets reached which is basically the way to stop the chain from getting dossed the fees go up essentially so it's basically a Doss mitigation Vector in order to make sure that the chain doesn't just get dosed to death and also that the state doesn't grow uh like you know to to stupid levels from from spam and stuff like that so that's the way we kind of meter it there and the same is true for l2s especially the evm l2s that are just copying L1 they meter it in the same way so when you see spikes like this these crazy spikes here all this is showing

you is that if we're using the web tool analogy here there's a really popular kind of ticket that's just gone on sale right to a show that's just gone on sale in the web 3 context this would mean there's a really popular mem coin that just kind of has some frenzy around it right but there is no I guess like cue that you go into there's none of that what the what what there is is just fees go up so unless you want to pay $10 for a swap to AP into this meme coin you're not going to ape into that mem coin but hey if you wait a bit and then buy it when swap fees go back down to 10 cents you'll be able to to to buy that mcoin there but maybe that memec coin already went like 10x in price and to use the

tool analogy again with with the show tickets eventually when you get through the queue there may be a thing where you can't buy the tickets that you wanted maybe you don't get front row maybe you get some you know shitty seating somewhere else or maybe you don't even get a ticket because they get sold out so as I said the analogy isn't exactly one to one but it's just it's just the same concept of supply and demand really at the end of the day and being able to meter that supply and demand and being able to keep the Network online and not you know not have it go offline from from Doss and and and dealing with Den Doss or denial of service uh uh is a big deal in web 2 you know they're not necessarily ATT tax it's just that whenever traffic floods something it can

fall over for a MRI of different reasons it can slow down and this has been you know plaguing web to for decades until I think over the last few years uh maybe the last five or so years there's been a lot of advancements been made here and the internet you know generally is is pretty okay and there you know you can't it's really hard to like Doss a site like um even if you're trying to do it on purpose it's it's very hard to do that uh and it's it's it's not something that is an unsolved issue at this point but when it comes to web 3 and then you can kind of throw in the context of things like rpcs rpcs work on the same kind of function as just web 2 apis do where essentially if too many people are spamming the RPC it could

fall over it could just you know crash or shut down because it can't handle the traffic and then essentially you can't pay anything to get your transaction included because that RPC is just offline right so that would be the more I guess like better analogy here that would be the closer analogy is that when you're spamming your transactions uh against the RPC it either has a choice of doing one or two one of two things I mean it doesn't really have a choice of falling over but it can drop those transactions which I which is what I believe that a lot of um salana apps uh do and salana rpcs do and just like the chain does in general where that's why there's a lot of failed transactions there it will essentially drop it to mitigate spam it's like a quality of service thing that they do um which is

not necessarily kind of I guess something that is a bad thing but the problem with that becomes that users get frustrated it's bad ux right um and then if you run your own RPC you can get around this but then I think in the cont text of of salana it's also at the chain level not just at the RPC level where essentially the leader is you know there's a leader every 400 milliseconds and there there's no mol so it's essentially you know you're incentivized to kind of spam the chain to get your transaction in there so it doesn't matter what IPC you're running uh at least from my understanding of how that works I'm not trying to pick on any chain here um but essentially it degrades the user experience and Bas has suffered from this as well uh I believe they had some failed transactions too

and ethereum L1 suffers from this well not so much in a post um Erp 1559 world World cuz we obviously have a much better fee Market but before that there was tons of dossing going on in terms of like uh in terms of like transactions failing in terms of transactions getting stuck because the fee Market was just really shitty but in a 1559 world it's a lot better it's not perfect but it is it is a lot better there so hopefully that explanation kind of rings true for you guys and explains a lot of stuff here but I'm going to uh leave that one at that because I've gone over time here and there's one last thing I wanted to talk about which was this uh I guess little bit of a weird announcement that I saw from something called anime coin so they a pro they're a project that has

introduced something called anime chain which is a new chain that they're building with arbitrum and isuki so they basically uh describe here what they they basically set the tone here that anime has uh has never been bigger and that's true I mean I'm huge into anime and it really has never been bigger it it's become like a worldwide phenomenon at this point um and it is basically permeated every kind of point of culture in in the world at this point so essentially what anime chain wants to do is basically bring that all on chain bring anime on chain uh and work with isuki to do that so they're doing this in collaboration with arbitrum it's going to be I believe an orbit chain as part of the arbitrum kind of ecosystem here um and they're going to be launching anime uh Productions uh games

physical products on anime chain providing a blueprint for other top tier anime EIP to be built uh on chain here so look I don't have a strong opinion on this I mean as I said I love anime but I don't know like the finer details of this there's not many details just yet you know there's a there's a points program you can sign up to right now um and isuki is an nft collection that's been around for a while you guys know I don't pay too close attention to this but I do think it's interesting and the reason why I think it's interesting is because it's something we haven't necessarily seen before uh I think that I think a lot of the issues people had with the nft pfp uh kind of projects was that they didn't really go anywhere there was all these promises of

ecosystems being built and they never really materialized but now we may be seeing it actually materialized here I know that board Apes is trying to do something as well but they've been very slow and they've built I think they've built like a little bit of a game or something but they they've been very slow there whereas something like uh anime chain they're trying to take I guess a different approach here of bringing anime on chain and doing a bunch of stuff around that so whether it works or not is another discussion but I just wanted to put it on your radar there uh for you to check out and I'll link it in the YouTube description below uh for you to to do so there but I think on that 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 subcribe your newslet join the Discord Channel and I'll catch you all tomorrow thanks everyone