Ethereum PoS chat, Post-merge ACD call and more - The Daily Gwei Refuel #449 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the delegate refuel where he kept the latest news in the ethereum ecosystem i'm your host anthony signer until the 16th of september 2022 all right everyone let's get into it so just before we jump into the news for today i just wanted to quickly shout out i posted this in the discord channel but i just wanted to quickly shout out that the delegate channel is growing in a bear market which is honestly just amazing to me and the reason why it's amazing is because we all know in bear markets most of this the industry or most people that were in crypto during the bull market just disappear completely it's like 90 95 percent of people are just gone right they've got no more interest in crypto they're doing other things maybe they'll come back in the future maybe they won't

but the refuel has been getting uh consistent viewership and that viewership has actually been going up over the past few weeks um and even i think the past couple of months uh on on youtube and on the podcast as well so for context here on youtube i think we average around 2.5 k to 3k views per video just depending on i think the topic so some topics obviously more popular than others and on the podcast it's around a thousand listens so you could say that we have 3.5 k to 4k people basically tuning in every day to listening listening to me go on about ethereum in a bear market in the depths of the bear market i think that's incredible like you guys know i don't do click bait i don't try to promote the channel in any real way i don't monetize

their channel nothing like that i literally just put the videos out there and the community has grown completely organically i mean obviously i had a springboard with my existing twitter following but from there it's just seemed to grow very organically and very nicely so i just wanted to give a shout out to all of you for supporting the channel and any newcomers maybe you've just started watching over the last few weeks or a couple of months welcome you know hope i hope you stick around for a while uh but it really just amazed me just looking at that being like well we're in the depths of a bear market and there's still this many people interested in me talking about ethereum every day i don't talk about the price right i don't do ta i mean obviously i talk about the price sometimes but i

don't do ta or anything like that as i said i don't do clickbait i don't promise anything maybe i dish up some hopium from time to time with my bullish rants but generally i talk about the tech so that's really inspiring to me that people are there's enough people that are interested in the tech that are willing to listen to me go on about it for half an hour every day but uh yeah on that note gonna get into the news so i'm gonna try not go not to go on a rant here but over the last 24 ish hours since we obviously merged there's been a lot of attacks from uh the bitcoin maximalist camp and i'm sure you've seen them uh to me it's just pure cope it's pure jealousy uh that we're able to do this in ethereum and they're making up all

sorts of crap and of course they're back to their old tactics of saying that eath is a security and there were some comments i think today from gary gensler the sec uh head uh basically uh saying that staked uh products on exchanges would be la it could be labeled as security as well so if you're staking your ether on a centralized exchange it could be labeled as a security uh or that product could be labeled as a security now i just like i said i want to go on a ramp but i will for just a little bit here i don't really want to talk about whether it is a security or not like obviously i believe it's not a security but i'm not going to go into the the i guess like points around that what i want to just say is the community

like in bitcoin has gotten to the point where they're simping for nation states to label their competitors like make no mistake ethereum is a competitor to bitcoin right they're simply information states to ban or label or ban their competitors or label it as a security to a essentially it instead of just competing in the free market this entire industry was built on bitcoin obviously because it came first it was built on principles of resisting centralized control we are trying to build decentralized systems so for the original flag bearers of that movement the bitcoin community to devolve into whatever they are today uh where they're actually simping for nation states and

simply for governments and and crying out to them to ban their competition or their competition is absolutely disgusting to me like i'll just straight out it is one of the worst things i've seen in this industry like yes we have plenty of scams and stuff like that and obviously those need to be called out too but this goes beyond that this attacks the very core of what crypto is supposed to be and what we're building when it comes to decentralization you know free market all that sort of stuff like that you can't have a free market if you're equipping your competition with government entities right you can't have decentralization or you can't say that you like decentralization if you're appealing to the most centralized actors in the world nation states uh and governments to

your competition so i just thought that that was like obviously this isn't anything new it's been happening for a little while here but it just makes me even more bearish on the bitcoin community like how can how can they say or do this with a straight face is is what i always a struggle with but anyway i'm not gonna rant any longer about that i do suggest going and giving this blog post from coincenter a read about this topic uh it basically discusses how the merge doesn't change how ethereum is regulated at all it doesn't mean that either security or anything like that so go give this threat a re uh sorry this blog post to read i'll link it in the description below for you but i'm sure you all feel very similarly to me about just the rhetoric that we've seen come out of the the the bitcoin community and

it's not just around as a security or whatever whatever they're kind of conjuring up in that on that topic it's also just everything in general they're literally just spreading at this point they're not even uh saying anything that's factual they're not pointing out anything that's based in reality they're just making up straight lies in order to discredit ethereum which makes me kind of bullish at the same time because as i said before you can say whatever you want it doesn't have to match with reality but reality matches with reality it comes knocking at the end of the day like how many people for so many years said that ethereum would never ship the proof of stake well it happened it happened so smoothly we are literally a proof of stake network right now and immediately they've gone and pivoted and moved the goal post and changed to something else

to focus on but the problem is is that every time their actual criticisms right which they haven't actually come up with haven't actually had for a little while but every time their actual criticisms get debunked they move on to more and more extreme things and they're at the point now where they're literally just making stuff up because there's just nothing left for them to attack that's actually based in reality so they make up all this stuff in order to discredit ethereum uh all in all i don't actually think it goes that beyond the i guess like crypto community itself i feel like uh the way we get mass adoption and things like that like those people aren't going to know about bitcoin maximalist and ethereum maximalist whatever that means and all these sorts of stuff this is very much

like just insider community stuff but obviously it's worth talking about on the refuel since the refill is for people that are inside the crypto community um but generally yeah i don't think it really matters as i said reality is what matters and the reality is ethereum is a proof of stake network we merged so speaking of the merge that's a nice segue into the next thing i wanted to talk about here all right so first up here we have a really great thread from patrick macquarie all about proof-of-stake ethereum now this is talking about the technical uh i guess uh details of proof-of-stake ethereum things like what makes it civil resistant uh you know what is the beacon chain what is bls signatures what is an epoch what is a slot what is a community committee so if you're interested in all of that sort of stuff and interested in

diving deep into how proof of stake ethereum actually works under the hood this is a great thread to read i honestly read through it myself and was like oh wow okay yeah yeah i forgot about that one obviously it's hard to keep everything in your head for for something as complex as proof of stake ethereum but uh patrick does an absolutely amazing job explaining it in his thread here so i highly recommend going and giving this a read uh because i mean it's not that long and he links to a bunch of resources that you can also go to to learn more as well um i know people are obviously more curious about proof-of-stake ethereum generally since we just had the merge we don't know how it works you know what are the trade-offs that we made by switching from proof-of-stake approval work to proof-of-stake so give this thread a

read i'll link it in the youtube description all right so transmissions here or t11s from paradigm pointed out that ethereum proof of stake is on track to use less than four percent of the energy that paypal uses each year that's a crazy statistic and you can actually see it comes from this chart here that was posted on the ethereum dot org website which was uh i guess referencing digicon a digi economist so you can see youtube gold mining btc power eighth power netflix gaming all use like a ton of energy right and then paypal doesn't use that much energy but it still uses more than ethereum proof of stake much more which i think is absolutely crazy um and it's pretty cool when you compare things like this but it also speaks to

the wider energy argument here because you'll often see people argue that bitcoin proof of work and ethereum proof of work was incredibly wasteful it was using so much electricity but you'll never see someone say that about youtube right or really about gold mining i think it act the same thing should be said about gold mining because gold does have practical applications but most of it is just speculative it's not actually based on its um its use within jewelry and things like that and then you have youtube which is at a massive amount like it's more than bitcoin proof of work so i think there's two things to this the first thing is that obviously youtube provides more value to the world right now vastly more value to the world

right now than bitcoin does i mean i don't think bitcoiners would agree with that but i think it's pretty objective i would say youtube provides more value than even ethereum does right now right they're different products sure like they're not comparable in that way but if you're talking about energy use as a proxy for value well the value that youtube delivers is in my mind vastly more currently than bitcoin and ethereum so i think that wouldn't really make sense to compare the energy usage here from that point of view again they're different products but you know you know what i'm saying plus with proof of work systems they keep growing forever basically like if the price of bitcoin keeps going up then the uh more miners

will join the network the hash rate will go up obviously but also the energy usage so if bitcoin goes to whatever like a million dollar per btc right the energy usage it's not like a linear kind of thing it's not like we're going to get the the same match depending on the price but it's just going to keep going up like the the electricity use would be enormous now how much value would bitcoin be bringing to the world at a million dollars per coin versus what it is today i mean i personally don't think it would actually change that much because like bitcoin in general i don't think has much of a future from a technology standpoint but let's just say for the sake of argument would it be delivering the value uh that it needs to be delivering to justify their energy use i

don't know i don't think so but i don't know for sure and i don't know if we'll ever get an answer to that but then this whole argument is very subjective this is just me giving my view you probably have different views but this is also why i don't really consider the energy reduction something that i'm most excited about when it comes to you know our change from proof of work to proof of stake what i'm most excited about i mean i like that we're using less less energy but that's just a byproduct of that better bang for your buck security that i've talked about i think that proof-of-stake is a better system and the massive bonus that we have is that we have to pay way less in issuance to secure the system and we have to uh and we use way less energy as

a consequence of that as well uh and there's a lot of debates around proof of stake versus proof of work and trade-offs and things like that but i think the trade-offs that that we made are worth it in order to get that superpower that we have of that surgical punishment that i've talked about before for bad actors i think that's worth any trade-offs that we made to be honest like that's such a strong thing that hopefully we we'll never have to use but the fact that we have an option to use it is incredibly powerful and also it that that i mean i was talking about social slashing there but also we have in protocol slashing too which i think is incredibly powerful uh as well but yeah i mean this it's cool to see a under proof of steak regime using way way way less energy than it was and

using less energy than most things in the world i mean look at this like should we start um calling out gamers because forever they've been calling out uh mining as wasteful should we start calling out them as wasteful look how much more energy they're using than us they're using 34 terawatt hours a year whereas ethereum proof of stake is using 0.01 terawatt hours per year which is i guess if i'm doing my math correctly it is a 3 000 or 3 400 times more right should we be going at gamers no i don't think so right but uh it just goes to show like how varied and how nuanced the energy use discussion is um so yeah but you can make up your own conclusions and make up your own mind about these sorts of

things don't just listen to me and don't just listen to what i think about this but at the same time i think that uh it's just great that we're getting much better bang for your buck security with ethereum we have to pay way less in issuance and we also use way less energy so very very cool to see that all right so uh saiga here who works as an azuki dev put together a uh i guess twitter thread about the new terms and tooling uh all got to do with proof of stake here so and he says these concepts will help you navigate this new era of the ethereum network this is really cool it basically goes through a lot of terms that i've mentioned on the refuel such as validator uh and slot and epoch attestation slashing all that sort of stuff this is a good uh kind of sister

thread to patrick's thread here so you should actually go read this after you read uh patrick's thread um so yeah read patrick stood first all about the merge and proof of stake ethereum and then read scigar's thread to go through what the terms actually mean uh and everything around that i actually think that those two threads there will get you uh very up to speed proof of stake ethereum if you still feel like you're behind so i'll link that in the youtube description you can go give that a read as well all right so this is interesting there's been a lot of criticism of ethereum proof of stake for a while around i guess the centralization of stake and i have talked about this a lot on the refuel so i won't rehash all of my arguments but one thing i didn't know was that 90 of lido validators are

actually run by operators not based in the us i didn't know it was that high i knew that was obviously validated outside of the us but i didn't know it was 90 which means only 10 percent are in the us that's crazy and if you want to go even further and say okay well uh which ones are based in the uh in areas that uh i guess maybe what's the word i'm looking for maybe uh allied with the u.s or more or more inclined to do the us's bidding so to speak well you have to kind of pull them out of this list and you can check out this list for yourself i'll link it in the youtube description but i think it's just really amazing that uh it is actually like this because i i mean i know lido is a centralized thinking provider

i know that sometimes i get a flack from people in other communities about maybe not defending lido but talking positively about them but i do believe that if not for lido the stake centralization issue would actually be bigger because what would have happened is that instead of people staking with lido which distributes the stake to these 28 different entities i believe people would have just staked with centralized exchanges and that would have been a worse situation than what we're in today so i applaud lighter for that now obviously later has issues it's still centralized it remains to be seen if they can decentralize and you're still staking with centralized providers anyway through lido that doesn't change that fact at all like personally i would rather go with a decentralized provider such as rocketpool but

a lot of people have chosen lido and lido was first to market they beat rocketpool to market so they got a big market share right but in saying that i've talked about this a lot about the centralization of stake my main points still uh apply here to decentralize the stake further to distribute the stake further we need more competition and we need withdrawals to be enabled right those are the two big things on the technical side on the social side obviously we need people to keep pushing people to use decentralized services we need to keep sending that signal we need to keep defending ethereum's ideals of decentralization and print and our principles around it and we also need to uh keep making staking solo staking easier and sticking with tools with decentralized pools like rocketpool asia which is all happening

in the background right and then there are actually other things on the technical side as well that will help with this maybe they don't help with the i guess distribution of steak but they help with the decentralization of steak and that is dvt which i've talked about before distributed validated technology and pbs which i've also talked about before proposal builder separation these things help with decentralizing out staking but they don't really help with distributing steak uh that it definitely falls on i think more competition in terms of stadium providers especially on the decentralized side of things uh and also on the um uh and also with the withdrawals being enabled now on top of all of that there is something that could be done as well on the ethereum base layer which is not going to happen

anytime soon but it's it's reducing the uh i guess like required stake to solo stake right now obviously it's 32 eighth that's unaccessible for most people but i've talked about this before where i've said that it doesn't really matter how low we get it like if staking is really really popular and ethereum is really popular like the eighth price is just gonna go up and then it's just going to offset whatever reductions we can do for example if we were to reduce from 32 8 to 16 today to offset that and to make it put us back to where we were all that would be required is for each to double in price like right if i if i'm doing i'm doing my math correctly of course i am it's an easy math thing there right it would be in the same dollar value if we did it

like that but in saying that by reducing that we also help solutions like rocketpool that have to add here by this right and when we just make it overall easier people to build tools and overall or overall um cheaper but it's kind of like hard to reason about because of the fact is we don't know what the price of eth will be but we all assume that eighth is going to be more valuable as time goes on so i'm not saying that we shouldn't do it but it's probably not going to happen anytime soon uh but definitely we should work on every other solution as well on top of that and speaking of pbs proposed builder separation there's a great tweet thread here from haim who i have talked about i think a couple times on the refill now about what exactly is uh is a proposal builder separation highly

recommend giving this a read because this is something that a lot of people are talking about it's definitely something that is trying to be prioritized on the roadmap i don't know when it's going to come but it's definitely going to come sooner than a lot of other things because it is something that is definitely needed so you should definitely get familiar with it and i'll link it in the youtube this thread in the youtube description below for you to do so all right so there was an all core devs call yesterday this was the first post merge call uh which uh was very very eventful obviously you can read timbico's thread for a full recap of what happened but obviously it was talking about the merge you know how smooth it went right uh what minor issues there were i believe basu saw some some some uh minor issues with eragon uh

doing so as well but other than that i don't think that uh anything else uh really went wrong and peter from the geth team basically said you know the whole thing was surprisingly boring and no issues found and things were stable enough for the team to spend the merge following the memes across twitter and reddit that's awesome isn't it i mean as i said the best outcome was the most boring one and we got that which was which was amazing and actually if i quickly want to go to the beacon chain website i can bring up the the proposal right i'm sorry the um the participation rate right now so it's actually climbing back up very very nicely it was at 97 points you know five percent i think yesterday now it's at 98.7 percent so we can expect that to get back above 99

percent uh relatively soon as well but i mean it's negligible at that point like the the network is pretty much at full health which is amazing to to see there so uh you can go give this thread a read from tim biker for a full recap of the latest all-call devs call but awesome uh to see that they did a call so soon after the merge i mean it makes sense it was their regularly scheduled call i believe it they always happen on thursdays now uh but cool every second thursday i should say uh but cool to see that uh and on the core devs front as well i spotted a little alpha leak in a reply today so you've got julio here uh with a tweet uh julio works on aragon saying i slept 13 hours post-merge uh night now i feel bamboozled and have a slight

headache but i will go hack at eth berlin and then marius from the geth team said i started the day with amate and bretzels on the train to eat berlin now plan to hack on eip 4844 so reading up on it right now so eip 4844 uh obviously i've talked about it a lot that's proto dang sharding right there there is a website you can go to ip44.com i believe let me just quickly verify that eip4844.com to check out all of that that's a little alpha leak they're already working on the next things i told i did say that the core devs want to take a break for four or five weeks but honestly i think that the momentum that we have from the merge and the excitement that we have from the merge i don't know if they'll be able to take a a proper break i think

they're going to be working on things in the background that's for sure so awesome to see that and julia replied by saying i you know he plans to hack on vocal tree transitions which is part of the verge part of the road map so things are still happening guys i mean shanghai is that next upgrade uh i don't know if we'll get both beacon chain withdrawals and eip4844 in that along with a bunch of other things but uh you know it just depends what what's ready and and what's ready to go in the upgrade but i think big in training withdrawals uh are at the highest priority right now uh and i think that the core devs understand that so we'll see how that goes uh but yeah the momentum seems very very strong right now so let's keep that going that's for sure all right so just a shout out here uh

josh davis um gave us a reminder that the ethereum protocol fellowship applications are closing soon and he's done a threat on why you should apply so i remember i shouted this out i think a few weeks ago when it was first posted and here's the blog post yeah on september 1st it was a couple of weeks ago now um i think when do applications actually close um they go till october oh wait no applications accepted through september 16th okay so they're close today so you definitely want to go apply to it today if you um if you're interested here but josh's thread basically gives reasons as to why you should apply so you can go give this thread a read as well i'll link it in the youtube description below all right so aztec has an update out

where they've said we've been hard at work making general purpose zero knowledge transactions accessible in this thread we want to describe a fundamental technology that helps us get there proof compression so you may have heard me talking about proof compression before it's basically a way to compress the proofs that need to be posted to layer one ethereum and uh by compressing them they're cheaper to post so obviously the fees are cheaper there why would you do this well because the cost can be passed on to users and why is it important for zk roll ups especially to do this because the proof is expensive on a zk rob it's more expensive than an optimistic roll up so it's definitely something that is very i guess like important for them to do so if you want to learn about proof compression and how aztec is tackling it you can give the blog post

and the thread a read which i'll link in the youtube description below for you to do so all right last up here i just have a quick shout out that the jpeg protocol guild slash stateful works uh fundraiser for eth called devs continues the new home of the heart thing that i've talked about so you can definitely go check this out i'll link it into the description below to see what nfts that you want to snag there uh including that panda meme nft that i spoke about on uh on on the refuel uh over the past i guess like few days as well um but that on that note there is one last thing i wanted to talk about to close us out today now this is i said on at the start that i don't talk about price that much but i want to just briefly mention this

because i i like talking about things that i see people in the discord talking about a lot because obviously people in the discord watch the refuel so i want to talk about the price action post merge we obviously dumped right there like i i didn't i don't think we dumped that much like relatively but we did and i have no idea why i don't know if it really was a sell the news event i don't know if it's just traders hedging their bets or closing their shorts after the um uh sorry closing their positions their spot positions after the eighth proof of work uh fork airdrop or whatever i don't know the reasons behind it i don't really care about short-term movements but i know a lot of you people a lot of you guys pay attention to it i said for a long time that just because the emerge

drops issuance to technically zero for six or 12 months in terms of new issuance hitting the market and obviously it drops issuance by about 85 percent even when it is hitting the market and obviously we have the burn to offset a lot of that issuance doesn't mean that ethyl is just going to pump straight away like i think there are a lot of people out there who believed for some reason that immediately post-merged eat was gonna pump and that was never going to be the case i always said it was never going to be the case but when you start looking at weeks months years like that's where it starts getting priced in that's where those that massive issue introduction starts getting priced in because over the past 48 hours we have avoided paying 40 million dollars worth of eth to miners

right that's a lot just for those two days but it's not like miners were getting that 40 million dollars in and dumping it straight away right they weren't dumping their eats straight away because they didn't need to and maybe they only have energy bills that they need to pay once a month and maybe they just wait till the end of the month to sell their eat or maybe they sell slowly through an otc desk over the course of a month two months three months i'm not aware of how miners were selling their ethan i don't think you'd be able to get a very accurate picture about that but what we are aware about and what's completely factual is that they were forced to sell most of their eighth to cover their cost because those costs are unavoidable so over time this will compound this will

actually start being reflected in the price but the demand side is just important as a supply side so technically you could say that over the last 48 hours there was more than 40 million dollars of uh of kind of like cell pressure to get us down there was like probably a lot more than that because of the fact of the matter is people wanted to sell in order to uh i guess like um you know maybe de-risk or maybe they think their macro environment is going to get worse and whatever for whatever reason right people sold there was more sellers than buyers that's what the market is at the end of the day right just sellers and buyers so if you look in the last 48 hours you could say oh my god such a bearish price action it's so bearish like the merger did

nothing or well i guess i should say the last 24 hours or you could look at the next week the next month the next year right uh when that happens and say okay well it actually played out right if it does play out if price does go up well okay the the issue introduction actually meant something which i i still obviously believe it does like there's no way in how it doesn't but there's always the demand side factor of it that you have to factor in and in this environment in a deep bear market where there's a lot of uncertainty the demand's just not there right now but i've said lots of times on the refill when the demand comes back right and when the demand comes back in a big way during a bull market that's when these effects will be felt so we build in a

bear market we get the spoils of that in a bull market the same was true for the last one d5 was not built in a bull market d5 was built in a bear market in 2019 a lot of those d5 primitives went live and then in 2020 with d5 summer that was still kind of a bear market because uh we weren't even at all-time high for btc and eighth i think 2021 was the proper bull market but 2020 was like a very insider crypto thing where not a lot of new money was coming in it was the existing money kind of flushing around but in 2021 was when a ton of new money came in right so the next time that happens with all the stuff that we're building through during the bear market that's when we get to collect the fruits for and that's always the way it's been and

the fact that we merged in a bear market to me is amazing like i love that i love that there wasn't actually that much volatility around this could you imagine if we were doing the merge in the bull market how much speculation there would have been on it and and kind of like how crazy the volatility would have been and how unsustainable it would have been it wouldn't have been great right but now we've done it in a bear market we'll keep building maybe we even ship like uh with beacon chain withdrawals and proto tank shotting and you know and some other good stuff before we get another bull market who knows like i don't know how long it's going to take but the point is is that we're shipping we're shipping things we're building things and we're going to and it's all going to pay off in the long run uh

because i obviously we all truly believe in ethereum and ethereum's mission and everything around ethereum so don't fret don't care as always say the short term price movement is complete noise doesn't really mean anything if you are buying then buy i mean it's up to you if what you want to do with your own positions uh i'm definitely buying some ether around here just personally but that's not investment advice to tell you to go buy eight you have to do what's best for you um but yeah that's i think that's going to be it i don't want to talk too much about the markets uh so thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give the video a thumbs up subscribe to the newsletter join the discord channel and i'll catch you all next week thanks everyone