Ethereum's goldilocks zone, Blob discussion and more - The Daily Gwei Refuel #804 - Ethereum Updates

Transcript

hello everyone welcome to another episode of Del refuel rap latest news Ean ecosystem I'm your host Dano and the 19th of October 2024 all right everyone let's get into it so this episode's coming out on a Saturday not the usual day that I do refuels on but the reason why I'm doing one today is because I basically missed you know Wednesday and Friday of last week and that was because of jet lag like it hit me really hard I was just super tired not able to do a refill because the energy just wasn't there and I didn't want to do one where I was just kind of slurrying my words right you might have heard some of it when I did the Refuel on uh on Monday um I definitely was feeling it then but then it just continued during the week unfortunately but I'm feeling a lot

better today so I figured I'd do one and I think today's episode's going to be pretty interesting because it's not so much about talking about I guess like project updates as much as it is talking a lot about what I spoke about on Monday in terms of narratives in terms of ethereum's kind of position in the ecosystem it's Northstar and a lot of the discussions that have happened around that on Twitter especially over the last couple of weeks you guys may have noticed that I've become a lot more active on Twitter trying to correct a lot of the misinformation and fud that is out there I typically been quiet on that for like the last maybe 12 to 18 months because I just couldn't be bothered with it but I think that was a mistake to be honest I think that uh is very important to be correcting these

things not just on the refuel um but on Twitter because obviously the reach on Twitter is a lot more than it is on on my podcast here and we've also got a couple of new channels in the daily gr Discord channel in case you haven't noticed yet we've got the fud fighting Channel where you you can pay basically post fud and I'll I'll uh help to correct it on Twitter and in Discord uh and then there's the eat bull posting Channel as well where you can just post bullish eth tweets and you know we can kind of support those tweets retweet them and all that good stuff uh there but on that note let's jump into I guess the first thing I wanted to talk about today which is basically ethereum's Mission now obviously ethereum has a pretty big mission overall it wants to be this absolutely massive kind of world

changing decentralized coordination engine and that's just one way to describe it there are so many different ways to describe what ethereum is trying to be but as I said there's been this discussion around what an ethereum's North Star should be you know what should be the thing that it's actually aiming for and I don't think there's really one kind of thing that you can say um but I do think there's a a bunch of things and I try to distill this down into a message myself and I put out this tweet right the the mission or the Northstar I think of the ethereum ecosystem for the foral be future and probably forever is to scale ethereum while keeping ethereum decentralized while making sure that eth becomes the most valuable asset in existence I think those are pretty good kind of points to hit on because it basically hits on most

things that we're doing within the ethereum ecosystem scaling ethereum is obviously critical we're doing that at both layer one and through the layer twos and that is working magically right now I think layer one scaling um I guess people say that it it's lagging uh but it's it's I guess like lagging because of the fact that it just takes longer because we can't scale ethereum L1 uh quickly otherwise we compromise on point 2 which is keeping eum decentralized that's the whole point right um and then of course the the third point which basically goes into everything is making eth the most valuable asset in existence making sure that e ACC value from everything that's happening on the ethereum network and we do that via various different means but I think the the the most critical thing is making sure that eth remains the deao money

within the ethereum ecosystem and is a store of value as well and in my opinion we do that by increasing the available um the availability of e basically increasing e money AR value within the ecosystem by scaling e so it all kind of falls into each other by scaling ethereum we scale eth we scale the eth network Effects by scaling the etherum network effects so that that kind of all falls into each other there and that's why I put out this tweet because I figured that it was just a really good simple kind of uh uh you know three points that hit on everything that we want to see within the ethereum ecosystem but as I said the Northstar kind of discussion gets money because ethereum is a decentralized ecosystem it is really hard to get everyone to agree on one thing and what is kind of funny

to me is that for years now I mean I've been pushing the eth's money story value kind of um things since at least 2019 so it's been 5 years now but but during that period of time there's been plenty of holdouts people saying you know eth isn't money eth isn't a store of value it's gas for the network it's a utility token so on and so forth which I understand you know if you come at it from like a te strictly technical perspective that's what it looks like but in terms of uh the perspective of what it needs to be for ethereum to succeed I strongly believe that eth needs to continue to crew value and needs to be a store of value within that ecosystem and a money and I think that the term money is actually misconstrued a lot I think people don't understand

that money doesn't mean the same as it means for Fiat for example like I'm not saying that eth should be like the US dollar I'm saying that eth should have a monetary premium it should be used as a way to uh conduct Commerce in various different ways onchain and even offchain maybe eth never is good money AKA it AKA it's not like as stable as we would want it to be relative to everything else but I don't think that's actually an issue and I've talked about this before in the past about stability and how I think about it how I think about purchasing power things like that for me as long as my purchasing power is going up over time while I'm holding eth AKA eth is appreciating value against pretty much everything else then I'm happy with what what what e eth is doing here but as I

said there are hold outs here which I don't really understand because I don't really think that there's any negative for you as a person to you don't have to support eth being money or a or a store of value if you're in the ethereum ecosystem and you're not trying to FUD eth or anything like that um but saying that it's not is actively harmful right so so if you don't think it is you can just like be neutral about it say okay well I'm indifferent to e being a story of value um but like if it is it is sort of thing instead of saying no it's not like I don't understand the the the mentality Behind these people it's like okay well by you saying no it's not that just leads to less ethereum adoption uh in my opinion because we all know that

adoption tends to follow an appreciating price like there's a wealth of the Native asset there is a massive wealth effect with these things you saw this play out with eth in 2017 with the Ico Mania you saw it play out with defi summer there is a huge wealth effect that happens that that gets um directly kind of ported to the um to the chain itself and is able to um further increase the usage of the chain and increase funding to develop the chain and it's kind of funny because like the ethereum foundation has a lot of eth and the more eth goes up the more money they have to fund etherum development and the more money um they have to uh to give out as grants to essentially fund things outside of ethereum core you know other things that we would like to see on the

network so again I just don't see any negatives to eth being worth more and more some people will say well if we're talking strictly technical it is a negative because of gas prices you know the higher the price of eth is if the gas price Remains the Same then in US dollar value the gas price goes up and while that is technically and strictly true it doesn't follow a a a correlation like that the eth price going up does not mean that the gas price is going to go up Market activity generally does tend to map to gas prices but it's not a onet toone relationship and also the network the ethereum network does not see USD prices it just sees eth it only knows eth because the only way it could see USD prices is via an oracle but there is no Oracle that feeds into the

ethereum protocol there are oracles that sit on top like chaining for example that is a smart contract on top of ethereum but it's not part of the actual core protocol and you would never want to have an oracle be enshrined as part of the core protocol for the USD price of eth because if that Oracle was to ever be compromised it could lead to really bad things happening on the network because it is enshrined at at the core that's why we prefer it to sit basically above at the Smart contract level rather than the protocol level here but as I said e the E network only sees eth it doesn't see the USD price and obviously the gas prices react to Market activity very heavily because defi is the main use case of um of crypto of onchain of the onchain kind of ecosystem and it remains to to be seen

if that ever changes I don't think it will I think it defa will always be the biggest use case and it will always be the one that commands the most amount of money because of I mean not just because of meev but just because of the fact that when it comes to finance you're willing to pay $10 to make a dollar profit right when it comes to I guess like social stuff like decentralized social media there's no strict direct kind of like monetary relationship there like no one's going to pay a dollar to tweet for example because you're not getting anything out of that whereas you if you're paying for like an Arbitrage in in gas fees you're definitely going to pay $1 in gas fee to make a profit even if that profit is Tiny it's still profit at the end of the day whereas

it's different for things out outside of defi of course so that was the first tweet there the second tweet was that as I said there's been this discussion about like what ethereum's kind of North Star should be and as I said it's different depending on who you kind of I guess ask but also people have maybe the wrong idea about what a North star is because valalik put out this blog post recently um I think this was a couple days ago where he basically detailed part two of the ethereum row map which is the Surge and I shouldn't say part two of the ethereum RO map because the ethereum RO map is not something that happens sequentially it happens in parallel uh but essentially he's talking about what the surge is and what its key goals are and the key goals as listed here is that we have over 100,000 TPS on

both L1 and L2 we preserve decentralization and the robustness of L1 at least some l2s fully inherit ethereum's core properties such as being trustless open sensorship resistant and maximum interoperability between the l2s ethereum should feel like one EOS system not 34 different blockchains now some people will call this a Northstar I quote tweeted this and said a wild Northstar appears but I was kind of making fun of the term U because I don't believe this is an Allstar these are key goals right like it's not it's not like um you know it's more detailed than than what I was talking about before when I said in in this tweet scale ethereum keep it decentralized and make e the most valuable asset those are closer to what a North star is than this because this is just a key goal like the first thing that he mentions here 100,000 TPS

on L1 and L2 that's the same thing as me saying scaling ethereum but he's actually putting numbers to this and that's getting too detailed to be a Allstar at least in my opinion uh pre preserve decentralization and robustness of L1 that is the same thing as me saying keep ethereum decentralized right and then the other two points I didn't really hit on about making l2s fully inherit ethereum's core properties uh and maximum inter maximum interoperability between l2s those are very important um and I think that maybe you could say that the um interoperability between the l2s you know ethereum should feel like one ecosystem is a North star but these are definitely closer to these kind of key goals or Key Properties here than a North uh star there but you should go give that blog post a read I'll link it in the YouTube description uh for you to

do so the next tweet I wanted to talk about was something that I put out around blobs now everyone knows that blobs are what we use to scale ethereum l2s they're where the l2s post their data instead of call data and blobs have been free for pretty much their entire life and this has caused a lot of discussion within the community around the fact that should blobs be free like should we be charging more for them right now they're just free the al2 are just free writing on the network while they make a lot of money from their sequences so on and so forth and as you can see from this chart here I I posted this tweet where I said you know the blobs are almost at the target of three e three blobs per block going to be interesting to see what happens when

blobs enter a period of sustained price Discovery now I didn't elaborate on what I meant by this and some people took this to mean that I thought that blobs going into price Discovery was good because we're going to burn more eth and it's going to be amazing but that's not what I meant by this there was two main things that I meant by this the first thing is that I want to see how the ecosystem reacts in terms of are the l2s going to stop using blobs as their as their data availability layer and go somewhere else because of sustained um blob price Discovery that's that's that's the first thing there and then the second thing was the fact that how long uh would they be doing this for like how long would they put up with this how long would their users put up

with this because as um things get more expensive for blob on blobs they do tend to get more expensive on the l2s as well it is not a linear relationship it tends to essentially um not be like one to one mapping or anything like that and the fees on l2s aren't going to go like ridiculously high like they do on on on Main net overnight or anything like that but there is that kind of period there and also um would this be in in impedence for the cevs to understand that we need to add more blobs because there's been the whole discussion around should we add more blobs now or should we wait obviously you guys know I've been strongly in favor of scaling blobs as much as we possibly can I believe blobs are a loss leader for the network I do not believe that we need to be

charging the um charging too much for blobs at this point in time maybe we can fix the blob fee Market to be more reactive to spikes in demand and to be more efficient but I do not believe and maybe have a minimum fee there as well but I do not believe that we should be um trying to essentially charge extra rent from l2s just because uh they're currently freeloading free riding or freeloading right now which I think is the wrong way to to to to to think about it because as I said blobs are a loss leader to scale ethereum in my in in in my opinion it's totally fine that they are not paying too much right now because what we're getting in return is is too main things one we're scaling eth the asset right we're getting eth into more people's hands because they're

using it on these l2s and two which is even more important is that we are preventing users from bleeding to other L1 ecosystems uh the existing users and we're on boarding new users into ethereum because without l2s without cheap l2s and without blobs really to enable that these other users would be or these new users I should say would be going to these other l1s and that is the worst possible outcome for ethereum ever like that is the if if we're talking about like North stars that is like literally opposite of a North star for ethereum we should not want that to happen ever and that has happened previously because we didn't have cheap l2s and we had L1 be super expensive and it's getting more expensive again as the market heats up of course so as I said I

believe blobs are a really great loss leader we should fix the fee market so that we can have a more reliable fee market for blobs and it's more reactive to things but we should not and and and I'm strongly in favor of of never doing this uh never uh maybe not never but like not anytime soon um charging extra rent just because we feel like they're free free loading or free riding they're not they are giving something back to the network it's just not directly measurable as fear revenue and as I've said before I do not even believe that fear revenue for eth and the burn and all that good stuff there it is the main value driver of eth if it was eth would not be worth over $300 billion I tell you that now e would be worth very very um very very much less than that like

maybe $10 billion or something like that it would definitely not be worth 300 plus billion and the reason why it is worth that and the reason why I think it will continue to be more valuable over time is because it is a money and it is a story of value and as I've said before the story value thing is mostly a story right it's a narrative it's a shared Collective belief it is not something that can be objectively measured it is not something that you can use metrics to really measure it is more like a Vibe than anything else it is a story it is very similar and Akin to a organized religion or a cult really I know it may seem a bit bit funny to say that but that's what it's like a shared belief a shared delusion if you will that's exactly why BTC is worth what it's worth

the Bitcoin network does it nothing I mean the the the ordinal stuff is so broken the ux is so horrendous and anyone pointing to that as utility for Bitcoin I don't think that that is is right at all and also Bitcoin was already worth near $1 trillion before ordinals even became a thing right so if you look at it from that actually it was worth back in the last cycle over a trillion dollars before ordinal became a thing so from that perspective we already have all the evidence that we need that to be sustainably worth hundreds of billions of dollars if not trillions of dollars if not tens of trillions of dollars the asset needs to be a money it needs to be a store of value there is no other path to that market cap to that level of market cap for crypto assets I strongly believe

that and that's why I keep pushing that E's money e is a store of value and that's why I believe everyone should keep pushing that because it has so many positive effects for the ethereum ecosystem uh in so many different ways like there's too many to name essentially right um I mean I can name a few narrative is a big thing making it so that the ecos system feels like okay yeah eth is a story value to money you know holding eth is great being involved with ethereum is great right bringing more attention to ethereum Bringing more Builders to ethereum Bringing more users to ethereum there is literally no negatives in my mind of eth price going up and yet okay people make money if it goes up like if that annoys you then so be it but people are going to make money anyway no matter where it is we'd rather

than make money in the ethereum ecosystem so that they stay within the ethereum ecosystem and we are able to build better products and we able to get more stuff done on ethereum here at least that's my view there now another tweet here that I believe is kind of related to this yes this comes from Francis this is an allore devs update regarding blobs so EIP 7742 will be included in um in Petra it seems like and this unlocks blob Target uh SL the max increase effort AKA adding more blobs to the network so it does seem like we're going to get a blob limit increase in the Petra hardfork which I believe is still due for like March next year um there may be a period of time between now and then where we see sustained blob um blob price Discovery

um you know above the target there but scaling is coming additional scaling is coming at least it seems like that it's not like I think 100% officially you know confirmed yet but it seems like we we're headed towards that in terms of like what we're going to increase it to I don't know there was discussion of increasing it to five uh sorry four being the um Target from three uh and then eight being the max but now there is discussion around five being the Target and nine being the max so I would prefer the ladder to be honest I'd prefer as many blobs as we can get but at the same time we also don't want to be adding adding blobs if it means that we're increasing bandwidth requirements for solo Stak because I discussed this on I believe Monday's episode this is a very important thing um and bandou

requirements of the overall overall Network here so there is a lot of work uh around this happening um as we have these discussions but I figured that was worth highlighting for you guys there and there was another tweet here from David who basically details what he wants to see when it comes to blobs uh first thing is uh I guess like first thing he discussed here is what happens when blobs enter price Discovery so he says here data gas fees will start Rising increasing the price of blobs as I mentioned l2's already passed on the cost to their users so L2 fees will increase of course by how much until the point where the average demand of blobs goes down to three some L2 users will not send transactions at the higher price likely low value transactions will go first like low value nft mints same

thing happens on L1 right things get priced out uh this will re reili equilibri the fee distribution between L1 and L2 somewhat but will add significant friction to l2's growth trajectory so he's basically highlighting the same issue I am we don't want blob price Discovery right so what do we do so uh David is in strong support of increasing the blob limit ASAP which is great because so am I uh then we should upgrade to a better pricing mechanism that charges higher than the minimum one-way data gas fees when the blob Market is not congested and handles demand spikes and temporary congestion gracefully again what I mentioned that I want to see and we should continue increasing blob capacity with pias and finally full ass or data availability um sharting here so

essentially uh David and me are completely aligned on what we want to see here and I believe that a lot of people within the uh kind of ethereum Community are aligned around this there is some people that want to see more research and study done on how increasing blobs uh affects the network overall in terms of bandwidth usage especially which is great that's happening as well so but as David ends his tweet with we do don't want to be in a situation where there's consistently more blob demand than Supply that is not what we want to see at all because I do believe that l2s that are using um ethereum blobs right now will stick around for a while then it's not like they're going to leave straight away but if we don't have a credible commitment to keep scaling blobs they will choose another da layer and that my opinion

isn't like that bad it's not like it's a huge bare case because it's kind of funny when you actually spell it out you say okay well ethereum da is going to be so successful that l2s are going to uh change where they they store their da uh that's not a bare case to me what the bare case is though is the second effect or essentially like it is it is still a first order effect but it's it's something that's more Downstream of this where the fees on l2s will get higher that is the loss because then the users start bleeding out from them and we don't want that to happen we want to keep the users on l2s and the way we do that is by keeping L2 fees cheap that is the number one way we do that there are other ways of course but that is the

number one way there so fully aligned there with David on that as I think we all should be next up here was another tweet by Yours Truly about how I think about decentralization um as a concept generally so I think I've talked about this before on the refill but I think about decentralization as an emergent property rather than a property in of itself and what I mean by this is that it tends to emerge based on a bunch of different properties and I've listed them out here so the first one is having a secure and reliable chain AKA no downtime that is one of ethereum's core promises that it is secure it's reliable it's not going to go down on you uh it's not going to get dosed like other Chains It's going to be it's going to be great right second Point here is a credibly

neutral Network there is 's no playing favorites the ethereum network does not play favorites it does not give preferential treatment to Bas over arbitrum it doesn't give preferential treatment to you as a user over another user there it has objective ways of controlling uh things like the fee market for example but it is credibly neutral right that I mean it's the only way we know how to control for dos attacks and control for spikes and demand is through a fee market and it's an objective way of doing it right if you have the money to pay for it then then you pay for it and that's it like we're not discriminating against it like if you have $10 to to pay a fee and someone else on the other side of the world has $10 to pay a fee you both get equal access to the network then I know

that some people will say well it's kind of discriminating against I guess like people who don't have that money it's like yes but that's not what we talk about when we talk about credibly credible neutrality we talk about the fact that if you assume that things are on equal footing here then um in an objective fashion in terms of like I guess fees in this case then no one is playing favorites there and then of course obviously we want to kind of scale up that credible neutrality via l2s so that isn't just for people that have money uh and then censorship resistance same thing uh no one can prevent transaction inclusion forever currently obviously you are not guaranteed to get your tornado cash transaction included in every block because of the fact there is some censorship on the network but no one has ever claimed that these networks or they

shouldn't be claiming that these networks are censorship proof because they are not they're censorship resistant they can have censorship on them at the inclusion level because we basically give the ability to validators um to include whatever the transactions they want to or not include what they want to but you can still get get your tornado cash transaction in because the network is sensorship resistant there is no one preventing you from getting your transaction included forever no single person obviously if 100% of the network was censoring that then you wouldn't be able to get it in um but it's that's not happening for and and and and on ethereum for that to happen is basically I wouldn't say impossible but it's improbable because there's so many different block producers out there we have so many solo stakers right we have so many people that will uh include your

transaction yes it might take a while but as I said it won't impr prevent your transaction inclusion inclusion forever the next property is diversity of clients which means no single point of failure ethereum kills every other ecosystem at this nothing is even close to this and I I think this in particular is one of the major reasons why I believe ethereum is more decentralized than Bitcoin because Bitcoin has one client that accounts for like 99% of the network if that client ever has a kind of like bug in it or ever has um something critical that needs to be fixed there is only a small group people that can fix that and it would require everyone to upgrade in order to fix that because they're all running the same thing when it but when it comes to ethereum we have a diversity of clients

we have 10 plus clients five on either side execution layer consensus layer so there is no single point of failure here and our client diversity is really really good right now as I've discussed before on the refuel so that's a critical point here one of the other most critical points is the ability to run a full node on consumer Hardware so you can verify the network for yourself this is one of the Holy Grails of of of crypto one of the things that crypto really enables is that you are able to verify the rules of the entire network uh for yourself there's no need to trust anyone else to do this and this falls directly into the ability to be part of consensus on consumer Hardware AKA be part of the proof of stake consensus mechanism on ethereum be a Staker and this leads to a wide distribution of

Miners and stakers miners before with ethereum proof of work stake is today with ethereum proof of stake there and that is why we have so many many um full noes so many solar stakers so many people that are there to defend the network and to decentralize the the network uh uh there's the last couple of points here is a good distribution of the Chain's native token so there's no no plutocracy there is no one holder that has so much e that they can exert influence over the network by holding that much eth uh and then the last point is reliable distributed funding for core developers like with the protocol Guild which leads to sustainable funding as far as I know there is no other chain that has something like the protocol Guild at least not on that level they all rely directly on their relevant

foundations to fund the core development of them which in my mind is not sustainable it is not a good way of doing things and it does not lend itself to decentralization obviously and I finished off this twet by saying this is why decentralization can be hard to measure and Define you have to measure and Define all of those things that I just mentioned and then place your relative importance on them of course the ethereum ticks all of the above boxes and more but we must continue to improve ethereum so that we can scale this decentralization to the world world and not just to people who can afford L1 transaction fees and I mentioned this before there is no use having all of these properties if it is for a small group of people who can afford the fees and that's why the rollup Centric road

map is so cool is because we do have a way to do this we do have a way to scale this up you don't scale the centralization up by throwing Hardware at it and making it harder to ver to verify the network making it prohibitively expensive to be part of consensus not having client diversity like sacrificing all that just to achieve some kind of short-term scale is not worth it at all it's it it really it completely defeats the purpose of what we're building here and it doesn't scale it doesn't even scale so so like this is this is what puzzles me it doesn't even scale to begin with I mean okay I should say it scales to begin with but then once you hit a certain point it doesn't it doesn't scale to the world it doesn't scale to billions of users it doesn't

scale to billions of humans and trillions of machines and it never will and and this is not based on just crypto kind of architecture it's based on Computing architecture that we've known for decades now so anyone saying that they can scale everything on on one layer and do everything on one layer is is either just outright lying or just doesn't understand and you know if you don't understand sure that's fair enough we'll educate you but if you're saying it and uh you still understand how this all works then you're just blatantly lying I think but anyway I'll I'll digress on that point there now the next thing was another tweet that I put out and sorry there's a lot of tweets that I put out um but I figured that i' I'd love to expand on all these tweets on the refill because you guys probably

read my tweets and are like okay well I'd love for him to expand on it'll detail this more and this tweet was about uh based Roll-Ups so I put a tweet out where I said I do believe that base rollups should be the ultimate end game for ethereum unless something better comes along later of course but right now we don't foresee anything anything better but we could be surprised in the future but to have good based rollups we need to have a better layer one namely we need to decrease slot times to at least 2 seconds and Implement single slot finality so that we don't have to totally rely on economically secured pre- comps for good based Roll-Ups now I'm going to unpack that there because I know that can be quite confusing people who don't understand what this is so so what is a base rollup in I guess like

the simplest terms a base rollup is a rollup that uses the ethereum L1 validator Network for its sequencing for its um transaction ordering and and inclusion so that you can get uh interoperability between base rollups because you're all using the same ethereum layer one here and a better decentralization because you're not using a centralized sequencer here but the main drawback right now of do of a based rollup is that you have to wait a entire ethereum slot or or I guess like it's not technically a block but like it it's technically called a slot which is 12 seconds so if you put a transaction through and a slot was just proposed you have to wait up to a 12 seconds to get your transaction included horrible user experience right we all know using L1 ethereum is that like we we'd love our

transactions to go faster but it literally can't because an ethereum block is or slot I should say is 12 seconds so in order to rectify this for base rollups there are two ways you can do this you can decrease slot times so from 12 seconds to at least 2 seconds cuz I believe anything um more than 2 seconds people get antsy it's like loing a website if you have to wait more than 2 seconds you're starting to be like oh well it's not worth it I'm just going to click off so at least at least 2 seconds ideally it would be 1 second but you have to look at this in percentage terms right going from 12 seconds to 2 seconds is already a massive jump going from 2 to one is also is is a huge jump in percentage terms it's like a 50%

reduction again and there are there are all these different kind of externalities that fall off of this so just getting to two seconds to begin with is is quite difficult it's not going to happen probably anytime soon but that is definitely something that is being worked towards uh and on top of that we want to implement single slot finality so that essentially finality today takes like 12 13 minutes um whatever it exactly is on mayet but but uh we want to be able to implement single slot finality so that the chance of a reorg basically goes to not zero but like essentially zero because within two seconds you get finality on the network that is really big deal a huge deal again something that's being worked on not going to go live anytime soon but hopefully eventually there now as I said there there were two ways to do base

rollups here the second way is to do what's called pre-confirmation now what pre-confirmation are is essentially they'll give you a kind of soft confirmation of your based rollup transaction within I mean as fast as you want basically the speed of light you can probably do it in like 4 500 milliseconds right but this is not a confirmation on the ethereum L1 because as I said the ethereum L1 takes up to 12 seconds to include your transaction in the uh in the slot right in on on the network essentially because it takes 12 seconds for a slot to to be proposed here or for a slot to happen on ethereum so for a block to be proposed so um the way that the pre comps work is that essentially I mean there are different ways to do this but essentially uh a group of people or people running this

software put up a bond like a collateral Bond and basically say okay I'm not going to do anything dodgy I'm going to promise to include these transactions in an ethereum slot once it gets proposed uh but I'll I'll give you guys a pre-con really really quickly like basically I promise that I'll include these transactions if you you pay the fee right they make a little fee here and that's all well and good that's why I say this is an economically secured thing not a crypto graphically secured thing because you're using money using collateral as a way of quote unquote securing this and and it's basically a promise that it'll get included on um on the network this is the way that the fast Bridges work between different l2s and different l1s or at least some of them work today uh because when we talk about different ways of securing things

is either the cryptoeconomic way or the cryptographic way we want to do as much as we can using cry the cryptographic way but it's not always possible especially when it comes to things like oracles it needs to be cryptoeconomic because the network it cannot objectively see what s outside of it so we have to rely on um on economically secured stuff nothing wrong with that right nothing wrong with that at all I said here basically that it acts as a really nice solution until we get um until we get a slot times of two seconds but pre-ms are still going to be a thing even if we do get that because of the fact that even 2 seconds might be too slow for a lot of um a lot of things that people want to do especially for bots so they'll still use pre comps as

long as they Havey taking on the risk that it's not cryptographically secured it's crypto economically secured so they go hand in hand but Bas rollups are in my opinion the ultimate end game we should definitely work towards them and it solves a lot of the issues that we have with l2s today I guess like namely the Two Chief issues are centralization of sequences uh and a lack of interoperability now of course bass rups are not the Holy Grail they're not going to be suited to every single use case and they're not going to be suited to every single L2 but they are a really good solution and on top of this I believe that um based rollups do require the um the rollups to share the same da layer so it actually keeps um ethereum blob sticky I have to check on this I'm not 100% certain about this but from

what I've seen it does require um that the da to be the same but I might be wrong here um but it definitely does require the the the the proofs the the ZK proofs to be posted on the on on on the ethereum L1 of course but when it comes to data I'm like 50/50 honor I think that it would require that especially depending on the construction right because like different D have different block times and and different things like it gets a bit muddy here but uh but yeah based Roll-Ups in my opinion are the I don't know if I'd say like I mean I said here ultimate endgame for ethereum but sorry I said that they're the ultimate end game I don't know if they're like the Holy Grail they're really really great they're what we should be working towards but they're not going to be a silver bullet they're

not going to fix well they're not going to be like suitable for every single use case out there and that's totally fine but I believe that they will be suitable for most things especially the things that um I guess like have the um the most value attached to them there now last tweet from me before I move on to a couple of other things so I basically put out this tweet which I think is is critically important here and I I want to read out the whole thing where I said ethereum is trying to sit in the goldilock zone of being maximally decentralized at layer one while being expressive enough to allow for things like scaling at Layer Two to be sure this is very difficult task and why ethereum tends to find itself in a place where most people struggle to understand it and why they should value care about

it regardless of that though I think that the ethereum is definitely succeeding at finding this Goldie log zone so far there are hundreds of people working on layer one and being sustainably compensated for it by the community via the protocol Guild uh there are over 10 clients powering layer one and this gives us true client diversity there are over 10,000 full nodes across the globe we have the most solo slome stakers of any Chain by far no other chain even comes close to this we have a flourishing ecosystem of layer 2s where users get cheap fees and fast transactions and blobs are working perfectly to scale l2s and I said and then I said oh and of course ethereum has not given up scaling the base layer it just wants to do it while preserving decentralization AKA not brute forcing it by throwing Hardware at it I

understand that people want ethereum layer one to move faster but that directly goes against many of the core beliefs and values of ethereum in saying that we can still put more emphasis on potential scaling Parts on layer one and work more diligently to deliver them especially those that enhance layer 2os let's scale all of ethereum while keeping it great um so this concept of like a goldilock zone is extremely hard to achieve just by Nature because what you're trying to do is ially thread a needle and as I mentioned the needle we're trying to thread here is keeping ethereum L1 maximally decentralized while scaling that at layer 2 and the reason why this is so difficult to do is not necessarily on the technical front because technical stuff gets solved over over time by smart people it's more on I guess like the narrative front it's more

on convincing people to look further than like a month in this industry because this stuff is taking many years to play out and I would actually argue that by the by um the time this is all said and done or at least gotten to a point where where we're like 90% done with this it would have been a good decade starting in 2020 ending in 2030 of building towards this future so that kind of timeline for people in crypto is not going to Jael with them very well and that's why or at least one of the reasons why you see so much fud about ethereum is because people just simply do not understand what ethereum is trying to do no other network is trying to be in this Zone in this goldilock Zone they're either scaling their L1 by throwing Hardware at it which means

they're giving up on decentralization or they're being so decentralized that they can't do anything else such as Bitcoin for example or I guess like probably saying that they're so decentralized is is incorrect here I think that they're being so dogmatic about not doing anything at layer one that they essentially um I guess like handicapped themselves into doing nothing and I guess like that works for Bitcoin um because of the fact that BTC has managed to convince people that it is sorry the Bitcoin Community has managed to convince people that BTC is a store of value and it's got a lot of uh you know it's got trillions of dollars in market cap and it seems like it's on its path to basically be that digital gold that they've always talked about but outside of that it does nothing else right whereas ethereum is trying to do

all of it and it wants eth to be a story of value as well right so that even that complicates things even further but I think that is the number one reason why people are so confused by E the they do not understand it and they don't necessarily want to understand it because they don't want to have to realize that it's going to be like a decade play and that's not to say that the E value can't go up and down a lot during that period of time but I'm not really talking about ethy asset I'm more talking about ethereum the network and how it all works here and I think that we're doing very well right now as I mentioned in these in these points that I made here we're doing very well on both fronts I think one thing or maybe two things that we could be doing better

on which I think is going to get better is uh over time one is storytelling and and narrative weaving around this and two is basically putting a little bit more emphasis on scaling the L1 I think that there are some short-term things that we can do I know I've been against this in the past but there are some some short things short-term things we can do as a pure sign signaling mechanism to convince people that we are dedicated to scaling the L1 and one of them is increasing the gas limit I know I've been against this in the past and I still kind of like am in terms of I guess if you're talking about what impact it has on the network itself like I don't actually think it's it'll it'll do much to scale the network but in terms of being able to I guess like tell

a story about this and show the world that yes we're committed to scaling L1 ethereum it's just going to take longer because of uh you know such and such reasons as I've outlined here so yeah that was that tweet there but yeah I've gone I've gone a bit overtime here today but there are a couple other things I just wanted to talk about quickly not uh tweets just basically news from the ecosystem so I don't know if I've covered this before but there's a website called reaking doino that was built by nethermind here that allows you or sorry that is powered by nethermind here that allows you to see a bunch of um data around um Igan da or sorry I should say Igan L reaking right now I think they might add other um other reaking protocols to this eventually but there's a bunch of information on here

for you to check out if that is something that you want to do I'll link that in the YouTube description below for you to do so and the second thing uh which is a major announcement actually out of fuel so fuel's mainnet is now liveed they're calling this the fuel ignition which is a supercharged ethereum L2 verifiable at home now fuel has been working on this for quite a while they did have V1 of their kind of network that they had put out a little while ago um but yeah this is I guess basically V2 or they're calling it ignition of their second um version of of fuel you go check out the blog post for more information on this now the reason why fuel I think is interesting is because it's not just like another evm L2 they're using something called the fuel V VM and a utxo based asset

Centric architecture um while utilizing ethereum's uh ethereum security of course now for those of you who aren't familiar utxo is a transaction format that is used by Bitcoin and it's also used by cardano I believe um but obviously um Bitcoin was the one that invented it and pioneered it here it is unique and and and enables unique things it is different to the account based model that ethereum has here um but as I said like this is being used in conjunction with something called the fuel VM which is not just uh another evm I think we got enough evm l2s at this point I don't think we really need many more than that so it's great to see that there is something different live here now the key stats that they're pointing to is that they've been able to do 600 plus TPS using ethereum blobs on mayet

their fees have remained incredibly low basically zero I mean it's not even worth me reading out this number cuz it's basically zero times of 1 second uh and obviously using blobs for da security here and they have an ecosystem map to to show you which um apps they have live there right now but you can go check out this blog post for more details about this and obviously bridge in if you want to now of course as per usual this is a new project new protocol probably has centralized training wheels around it so make sure you're aware of that before you uh bridge in before you put any serious kind of capital on this but just great to see another nonm based L2 going live here but I think on that note that's going to be it for today so thank everyone for listening and

watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe to newsletter join the Discord Channel and I'll catch you all next week thanks everyone