How L2s Will Drive the Next Wave of Mass Adoption

Transcript

hello hello hi everyone I'm Angel and I'm one of the co-founders of zerit uh we're very glad to be here and thank you so much for um inviting me to moderate this um amazing panel I'm here with a lot of the great Founders in our space so um I guess we'll start with the round of intro um starting from Marson hi I'm Marchin I'm working on ZK SN as a chief protocol officer it's amazing to be here with all of you folks and let's talk talk about l2s hi everyone I'm Ron a co-founder of Kinto building a layer two for financial applications and rwa and it's a pleasure to be

here hi I'm Nick very nice to be here uh I'm building fuel which is a optimistic rollup on ethereum um the primary difference being it is specifically not evm compatible uh interesting for an ethereum conference and um yeah very excited to be here hi everyone I'm Leona from inmax and inmax is a stat L up and the I'm super owner to not talking with you guys today hi everyone Amir I'm the CEO and co-founder of uh puffer Labs we have actually a product live R now which is a permissionless a fully permissionless and decentralized liquid restake in protocol that you can run host your

hardware and also a stake permissionless our aim is to empower etherum validators to to decentralize the network further so we have recently announced the launch of our base rollup puffer UniFi to help the validators thank you great um and uh once again I'm from zerit zerit is a zero knowledge rollup we're launching our phase one main n next week so um stay tuned and um today's panel is for Mass adoption and I think since the beginning I think rollups were born with the mission to like scale with um cheaper transaction costs and faster transaction speed and to um on board

more users um so um we all have our own approaches some of us went with the optimistic rout some of us went with ZK and um some of us are allpurpose and some of us um like kimto you guys are focusing on on a specific area um as Founders what do you think um is the most important to grow your ecosystem and what's your plan to bring in the next million or billion users um I guess we'll start with Amir yes so we really um have three core values at puffer being ethos align being

research oriented and take care of our users um through that we were able to really on board many retail users to our platform today we have over 240,000 users for our liquid reaking protocol we have um I believe more than hundreds of uh at home stakers that are taking advantage of our node setup to actually compete with centralized entities that was our approach to unboarding retail and normal users and professional node operators for our BAS rol up what we really need to enable and aiming to enable is to solve for liquidity fragmentation that was really a problem a challenge for dap developers to develop once we are able to solve the

infrastructure that enables a better ux for developers and users of these rollups we would be able to on board the next batch of developers new and interesting applications that are to be launched and the biggest part of it is for us being composable with the L1 in real time that's the real value out of for UniFi and that comes from it being a base rollup that's where sort of our theme is being based and sunglasses I'm also putting these on to protect my eyes from the massive projector light but uh that's our future and that's why we believe we can like get both users on board and take advantage of like our experience from puffer to actually

expand puffer unify roll up user base great uh Leona yeah and INX has boss scary and privacy at the same time this is the strangest of in Marx and so right now later is quite competitive space and yeah no lot great project are no making their no scar abity for evm and we are focus on the kind of payment size city uh in terms of pay payment stuff INX is the best I can guarantee that no we can make it make the gas stable and also private at the same time and privacy bir is quite uh important for us and the core value of in Marx their privacy is basically each cycle uh

each boom Market make a lot of privacy Believers uh because people want privacy after they get some money or large amount of money in the blue market right and the later stage of the each cycle the people realize that they they need privacy no basically this is a typical no privacy cycle actually and yeah our side we can stop from the privacy focus our uh user base and also after that we can reach out the many kind of payments our users uh to reach out uh and kind of let's say yeah all over the world and I travel a lot in many places like Nigeria and the noria uh turkey and the Argentina know these

are countries know they have crypto adaption somehow uh they they're not paying with crypto but they get salary with crypto and transacting with crypto a lot and the this kind of stuff is happening are kind of outside of X space or uh let's say a Twitter space no uh we up to think that uh no Twitter or X is there no all about crypto but no what is happening in there no many places is like a re adoption of crypto with payment so we we can uh focus on that in the long term and we can start from the acquire in their privacy uh users and the yeah making a privacy Focus

Community uh who believes their no value of privacy in the long ter okay um next we have um Nick I'm just gonna try to spice spice things up a little bit here um can you guys even hear us over there can you hear us yeah you can all right all right well here's here's the spicy take from a layer 2 rollup developer I actually don't think there's any barrier anymore to any retail people using any of this I think we have way more than enough options and infrastructure and different

things and there's no excuses so I think at this stage I mean with fuel I would be happy when we launch that we get a 100 users and I make them very happy I'll take a 100 I don't need a million I'll just take 100 100 really satisfied people if I can satisfy them then then maybe I'm on to something um so to think millions or billions sure if you think you want to handle that but I think that the main thing is that I think we have so many different techniques and options now that there's no excuse to this being a problem and in fact everything with ethereum and everything with rollups is backend so you just make will we will

just make it work we will continue to improve it there are many different options there's there's ZK techniques and optimistic techniques we can fight about which one's better but ultimately I think that um we have enough now to do that so it's not really a technology problem anymore I think that this is a different juncture that we're in when when it was just ethereum lir one and I couldn't make more than 10 transactions and there was no other option it was really painful yes we had a infrastructure issue but for ethereum now I don't see any reason why we can't host millions and and billions of people it's just going to be with varying degrees of security risk assumptions and different degrees of what we want to

accept for the user experience um what we think is appropriate but there's no reason now infrastructure is not an issue okay I see Marson is getting ready to speak sure because this is actually the thing I agree with like if you look at ethereum like two years ago one year ago people were paying dozens of dollars for simple transactions then L2 came and now you pay fractions of a scent so the question is what else is missing where are these billions of users there all the billions of users to to come and build and for me this is actually the question I always ask people it's like hey what would make you folks be hey all of us are building infra here what is

the pie that you're the piece that you're missing to be like hey this is there I'm going to go and build an application right now for the users can I say what is missing please it's like right now we're going after this sort of like winner like winner stack take all assumption on the rollup and that has been causing this liquidity fragmentation everybody is trying to sort of like really promotes that my stack is winner please join my stack and then one stack grows the liquid one other stack so it causes sort of fragmentation we're promising to resolve the fragmentation at some point but let's say I have a lending protocol on

rollup X that uses xstack and I have now a deck that I want my liquidation to be represented at which sits on rollup B but they cannot in any way communicate or talk to each other haven't we really fragmented that but this is for Defi and I'm hoping the blockchain is a lot more than just defi he has a placeholder I I guess like um to to go back to your original point right like what are we missing I think um user experience is still lacking a lot like these days um one of the exciting things for this cycle is actually ton like so many um ton Ms are pumping out and they're

bringing a lot of like millions of new users already and um yeah we have uh many exciting new things this cycle we have the ETFs we have the Trad fi institutional players we have um technology breakthroughs and um I wanted to actually ask what do you think that we can build now that we weren't able to before and um what kind of projects or dabs are in your mind that could actually help with mass adoption yeah I can take this one and I think it goes back to what Nick was saying there is enough block space so I actually another spicy take I don't think we need 30 40 50 layer tws the only reason to build a

layer two is like if you are changing the AVM changing the chain to satisfy a specific use case in our case uh we have a arbitrum L2 that is designed to on board financial institutions and rwa use cases in our case we have modified the chain to require kyc so every user that needs that needs to use the chain is required to complete the kyc process but we are still decentralized we're still permissionless we're are still connected with the the ecosystem but U users and institutions can operate on ethereum now instead of having to use private blockchains permission blockchains and they can connect where the liquidity is where the developers are and when the users are that are in ethereum and we also focus on allowing users to use

crypto without even knowing it's crypto we have native account attraction as well so users don't have to worry about gas don't have to worry about private keys but they still enjoy non-custodial accounts and they can access financial services without knowing is scrypto okay great the thing I would add this is the thing that actually excites me the most going forward is with the ZK technology even the demos that we've seen a couple days back you can actually start proving web 2 behavior on web free things like zap ZK email ZK passport and this is super powerful because this means that we can actually allow users to take the data that they have on web 2 and prove it on web fre and for me this will be a again this

progress in ZK technology this progress improving will with things also like FH with also like private privacy coming in this will really move a needle from blockchain being just token swapping and people buying nfts to actual applications that user care about that user use daily yeah I think we've had a lot of uh projects working on DK Pro the cycle and um they're even bringing it to like Bitcoin and like other chains right um how about the side what kind of projects or DBS do you think we can now build that we weren't able so something now which was impossible before and possible

right now right so I think that uh basically after defi uh there's no significant uh new kind of upgrade of the new New Movement but I think it's should be so uh ler to is not making a new kind of totally new things it's all about the kind of making serum scar right and the yeah we providing the new stuff like you know a privacy stuff and the also stateless application fine uh in our architecture and for example in Phoenix they have no uh privacy smart contract um but basically main stream of Layer Two they don't allow significantly different use cases from layer one

and the it's fine and later to allow there more kind of gas Limitless are kind of defi or something like that no I heard that some of defi can go beyond their uh 8 million gas limit uh they don't have that limitation so they can make a new kind of uh stuffs like uh know super difficult competation how Finance are uh kind of uh let's say uh yeah Finance Tech uh engineering and the yeah many stuffs are happen with that kind of new scalability but basically Scarab is all about the Leu and we we are kind of

no we don't get out from there no ethereum basically it's a use case of ethereum I think so the other stuff like uh know the AI with the GB on the uh the real world asset or TLS are no Oracle no as he said no it's quite fascinating but basically how to tokenize everything and how to make it tradeable it's the B mainstream of the know ethereum in my opinion and it's totally fine uh if we don't have a significantly different architecture or application architecture in my opinion okay I think we might have different opinions on that uh I'm about to jump in again with different opinions

I feel like we at Puffer we we love bringing AI on chain right we actually worked on building an endtoend encrypted facial recognition out of a trusted execution environment we but then we went down a level we were like what does it take to create this future money as ether what does it take that an entire banking system of a country just decides I would like to have a fork of ethereum I would like to have a rollup that runs on ethereum for my financial Paradigm we start started by addressing it from that layer is it ready yet does it have let's say privacy does it have provability to actually create this uh paradigms of

trust so we can create this future of financial ecosystem can we start by creating a great decentralized Foundation that we can finally end up getting to the dream of decentralized compute and decentralized World computer as well that can do all this future interesting stuff that's where we took it now step by step our excite initially after creating that was like okay this is very exciting these things are all possible but let's now create a great Foundation that can deliver us this massive future and possibilities that this future of internet can bring us which is the these future use cases and applications okay see I mean the thing is and maybe again I'll just try to keep it real spicy just for the for the

audience here um let's you know let's keep it real I don't think any of this matters I think it's all exciting it's great for us it's great for the people in the room and it's great for maybe like 20,000 developers or whatever something like that that actually really need to care about this I think for me I'm I'm not sold yet that these are actual things or real problems I mean I like I like the ZK email thing but wouldn't it be better if Google just had a key and sign things I mean that's what you're using the TLs certificates for and all this other stuff but it's a hack you know like it would be better if these companies just used basic signatures for things and then we could actually start operating over anything right so I'm I'm all for it I think it's

all really cool and it's an interesting intersection and I think as well in terms of ZK at least what it has going for me that I really like is that right now most users go through a server to get everything so it doesn't matter what you do they can try to prove to your browser which is also being served by the server to a user a bunch of things but it all goes through a server anyway that someone trusting your there's a trusted endpoint there at least if everything was ZK maybe there would be more ways that we could prove more things about what has happened which is excellent but even still I think that you know as far as use cases are concerned you know we keep soul searching for more and more use cases but I think I think even the very most

primitive use cases we have for ethereum are actually incredibly powerful even just a NOA safe stable coins and being able to set up a NOA safe and use stable coins to pay people is such a tremendous amount of the global economy that like even if we just did that really well we would be really doing great in most of the paradigms of security

that that we see typically anyway yes you can get more provability and more evidence of things that have happened behind the server but even still most users similar to https I mean they know it's there they know it's important they don't really know why and we're still in a very experimental phase uh of a lot of these things so I think for me I just looking at the space right now I still think that um we we make up a lot of reasons to want certain things and we certainly should try to get more evidence like client proofing ZK proofing all kinds of evidence into the system but I still don't think it's really the real barrier to why we don't have users I think the real barrier to why we have user don't have more users

is because of who we are you know we're we're nerds there's no way we don't figure this out you I'm not a nerd no no I'm not a nerd I'm still going to say you're a nerd cuz you're you're moderating a very complex panel so no no you're still a nerd I'm Proud To Be A Nerd yeah yeah the thing is um unfortunately a lot of the reasons why Mass adoption might or might not happen is all based around things that are not technological they are other reasons there's other reasons why there other motivations for why human beings would or would not want to use these things so I think for me just you know there's deeper stuff going on here I'm very happy that people are trying based approaches ZK approaches optimistic approaches different kinds of approaches

in general it's very very good and ethereum is very diverse in that way but I also think that it's not it's still not enough for me as a as a reason why we haven't hit this stuff just yet I mean you know so can I say something sure as engineer you can build a bridge it can be fine 10 days it can be fine a 100 years but one year that it can collapse how far are we taking being optimistic right one of the reasons I feel like I would Canter argue that we haven't been able to on board these folks yet is like we haven't one been able to prove to them that this infrastructure is ready for you to reliably put away your Visa card

and start using this as your form of transaction and communicating with others I mean I I disagree I my whole wealth life everything is on ethereum vitalic sitting over there because of him I secure my entire life on this thing now I really hope we don't mess it up I really do and and I kind of Leave It to the smart people in the room you actually mentioned the the retailers who sit at home do they have the knowledge and comfort level that you do after after working five years or how many ever years I don't need to rely on that because once they figure out how Wall Street Works they'll really come here I mean don't worry about it Wall Street will take care of itself and they'll be here in due time okay and then instead

of looking to the you know um the the Federal Reserve Gods they'll be looking at vitalic probably anat and some few other people and going well I guess these guys have figured it out you know so I mean the thing is I I think there's enough motivation in the world Brewing for why crypto I think that's it's happening all the time every time a government ruins their currency every time a corporation ruins their customer base they come to crypto and they find our stuff and then it's now a diverse thing that you have to you navigate through to get there well well we are getting a lot of attention from the traditional world right like um these days like the all the political campaigns they're talking about crypto

we're they just want swing voters but still I know what you mean yeah yeah it's becoming a thing so it it is going on and then we are like um having more awareness from like the general public about our space and um I I do want to move on to the next question um which is um I think ethereum since the beginning has always been kind of the playground for people to try out new ideas to experiment new things and um luckily this cycle we've been seeing more um ethereum stuff for bringing brought on to other blockchains and ecosystems for example um you know we did um reaking we started with uh ethereum reaking and

then now um a lot of Bitcoin projects are also trying to do staking even reaking um and they're also bringing Bitcoin staking onto ethereum and um that's um um I think I want to ask um how do you think as rollups how do you think we can improve the interoperability between blockchains and improve the um user experience for people to smoothly um interact between ecosystems yeah I can start and I can tie to the previous question I mean five years from now the best technology that always wins is invisible and needs to be invisible and I think five years from now three

years from now even users are not going to know if they're using arbitrum optimism circuit Kinto whatever it is but they're just going to use an application that uses crypto in the back end to do something that they couldn't do before and in the case of Finance it can be that this 24/7 it settles in a second instead of three days it's a lot cheaper and that's what the user is going to see and then in the back end and uh behind the scenes you're going to have all this synchronous compos composability that is going to happen and then the ethereum road map will be fully achieved once you can seamlessly hop between all these diverse ecosystems and kind of switch liquidity like if it was all as okay the way I would say it is that if interrupts we're going to get a

different flavors right this will be trade-offs between the latency the costs the risks of course one thing that I hope that all the rollups can agree on and this also what vitalic was mentioned yesterday is that the same way how internet is working thanks to tcpip that we have these Basics things from from addressing so that we can at least that we don't confuse our users that we don't confuse the apps that are building on top of us so yeah I I prefer the client side uh know implementation and client side proving stuffs and the you know before 2022 people said that no client ZB is impossible no client ZB something like

uh Pro huge with a huge computation power uh aggregate that and these kind of stuff that's know recently it's totally possible and the client give it takes only 5 seconds or 10 seconds to make a very uh kind of s level of competition or side level of Target and it's super useful uh to make asset interoperable between layer do and the now we can input all the stuffs of to on the uh uh blockchains to the client circuit on the know you can makeer asset of TR kind of inability on the this kind of stuff so it I I presume that the age of clients and thep will come after

this right but you but you want addressing without addressing like you users have to input something right user have to input who they are sending stuff to and everybody's using a different thing and if every protocol is using a different way of selecting so it's all about you make proof or plba make proofs on the basically client site can do that in this age you can they can input their all their hashes or Market rout on uh know the blockchain data into their client circuit actually and our project doing that so basically it's totally possible right now um I would come out like again since we're like really interacting with uh

normal retail users here at puffer is like yes they do care about composability where they go they do about like let's say they have a project or a community that they want to take advantage of this yield bearing token that they're minting they want to to uh take advantage of it another chain another ecosystem another even taste of evm um I would say to get there to get to that level of composability we really need to probably get to a decent level of like snark provs if we get to a stage that we can probably prove our State on Apple watch I don't know a phone or anything then we can comfortably say okay we made it again we got we beat the Visa that runs out of our Apple wallets

if it runs there we can prove this state then we can really prove this state to any other chain and be able to communicate with them as well so yeah that where we can get the ultimate endgame sort of like uh interoperability yeah I mean it would be um I thought I thought ZK s would have just said ZK is the endgame you know why didn't you say that I thought you already did that it's fantastic we want Community to say that right right right that you work together here yeah yeah um so I think for me there's two sort of fundamental paths right one is that everything is ZK which which would allow you then to prove in such a way that basically every chain um Can can prove each other's

State can prove evidence of of where funds are so you can basically accept for example if it's secure enough uh the the cryptography you can accept that another chain is valid and the state is X uh which is enough then to have one kind of global layer of of um of evidence that um can interoperate with each other now the alternative is until things are entirely ZK um basically you need to be willing to accept other assumptions and what assumptions you want to accept are sort of up to both the developers the projects and what the users want and what the market wants and so if we are

in the realm of accepting assumptions then there is different kinds of assumptions with different levels of guarantee and it's basically along the lines of how much do you trust say an honest minority Assumption of arbitrum or optimism how much do you trust particular assumptions what are they worth how could they be bonded and how can you solve a coincidence of wants across both ZK and non ZK right so basically ensuring that the math is correct versus ensuring that the assumptions are correct and you have to at least for the next few years we have to play a bit of a game where we use trust assumptions across our architecture um both for things like just getting ahead of proving but also

between interoperating these different chains however if you calibrate the trust assumptions right you can solve probably 80 to 90% of liquidity and efficiency you see right now okay I think we have a pretty big panel today and we are already going over time sure and U so I'm just going to U interrupt there uh we are all of us are very happy to be in Tokyo and we definitely love the Japanese communities um we've been hosting a lot of side events zerit has been doing our M Cafe event and um tuna party I hope you guys were able to come and uh you know we have a lot of boosts outside and um our teams will be there so please feel free to come chat with us um we're we're definitely very exciting

about um bringing more um op unities to the Japan market and very excited to see that the regulations are starting to open up and more getting more welcoming um yeah and uh very glad to be here and I think we'll continue our discussion off stage and uh yeah thank you thanks everyone thank you thank you so much all right thank you very

much he's already going all right let's keep it going keep this party going go go go [Music] go let's go oh oh my God I know it's Japan but don't karate kick anyone in the head please it looked like karate to me