Fei Protocol Announced, Synthetix 2021 plans and more - The Daily Gwei Refuel #33 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the daily gray refuel where i recap the latest news in the ethereum ecosystem i'm your host anthony sosano and today is the 12th of january 2021. all right everyone let's get into the news from the day so another day another day that ethie's not at all time high and i'm still banned from posting on twitter while i guess a self-imposed ban but i am really really loving all the memes uh that's for sure it's what's uh so it's kind of like keeping it this very entertaining for me so as you can see on my screen here there's a meme put out by scoopy triples here um which is quite funny there's a bunch of other ones that i've seen around and you know i wake up in the morning i check my phone there's a bunch of new ones so

yeah i mean keep them coming it definitely makes it fun for me just to observe obviously i can't reply to anything but i can like and retweet that's kind of a loophole that i that i have right now but yeah um i think you know i don't know how long this is going to go on for and maybe eventually people will just tell me you know you can come back it's okay but i will stick to it i will stick by my word because i do think that if i if i don't i'll never hear the end of it that's for sure i'll uh people will keep keep coming back at me about it so yeah keep the memes coming um and yeah if you want to chat you can just damn me on twitter or like discord or whatever i'm i'm there as well um but yeah i

guess it's been kind of nice to take a little bit of a break from twitter as well uh you know as i guess we're getting into this bull market now um good to have a break before we like really get into it and like just gets gets really noisy from there so yeah definitely not the worst thing that could happen that's for sure all right so synthetic so there's actually two updates from synthetics today i have this one here from kane i'll go through this one first so basically uh just a few hours ago kane published this blog post called synthetics 2021 which is uh basically i guess a road map and a overview of what synthetics is going to be doing in 2021 uh and they've got a big year ahead of them definitely uh so basically he runs through it in this tweet thread

which i'll actually go over you can read the full blog post but it's quite long so i'll link that for you guys in the youtube description to to kind of have a read through but basically what they're doing is they're going to be focused a lot on scaling right so i've spoken about this a few times now on the refuel about how they're going to be scaling using optimistic ethereum from the optimism team uh so they've been you know big proponents of that they've been doing test nets with that last few months so that's definitely coming uh they're going to be releasing synthetics v3 which is basically a complete rewrite of their entire contract suite that is not backwards compatible so basically it's going to be everyone needs to upgrade to this v3 uh because there's so much tech debt in v1 and v2 that i think the synthetics team

would rather just go with v3 and and not have to maintain the old kind of versions which makes sense another area of focus in 2021 is going to be governance improvements especially around their spartan council which for those who don't know is basically i guess you could call it um a a bunch of multi-sig holders essentially acting as like governance delegates for the synthetics protocol so i think they're going to kind of expand that out and and and kind of improve upon that model it seems to be working for them they've got synthetic futures coming they have uh more assets coming to the network uh basically i guess include more crypto assets commodities and foreign exchange um but most importantly uh he believes

the spartan council is likely to request chain link provide equities fees as soon as they take control of the synthetics improvement proposal process that's going to be cool right synthetic equities um you know that's something i would i would use for sure i hate using the old clunky traditional financial system to get exposure to different stocks and things like that so i would love to use uh synthetics for that definitely now there's a bunch of other stuff here like binary options uh he lists here basically there's going to be cont you know for stake is there's going to be continuous staking rewards instead of a weekly snapshot there's going to be continuous vesting instead of a you know a year-long vesting thing um and there's a bunch of different things here like silo deadpool there's some i mean there's so much coming to synthetics and i mean full

disclosure here i'm an snx holder i have been for quite a while and there's a big reason for that they're just one of the best projects in ethereum right now and within d5 uh they just keep executing on on the products that they're building they have a lot in the pipeline they're trying to do like a few different things at once they're trying to push the envelope forward especially with scaling right and you know i think you know kane especially is definitely i mean i guess all in on ethereum i don't like to call people ethereum maximalists but cane is definitely all in on ethereum and he understands that we can make this work right we can scale wire layer two we can get to i guess like the decentralized world that we want to get to so i really respect kane and and the way he structured synthetics and

the team and everything like that so that's why i'm a i'm a very loyal snx holder and i love i love watching this project evolve so yeah go read the full post if you want to get more context around everything they're doing as kane says it's a 2500 word post so definitely not a short read but something that i think you know if you're an snx holder or if you're interested in the synthetics project it's worth your time to read it and on the note with synthetics uh they've also got a new liquidity mining incentive for on curve so you can there's basically 8 000 snx per week up for grabs to provide um s or synthetic euros liquidity to curve finances euro liquidity pool uh which is pulled with uh eurs which is

from stasis i think uh yeah stasis um is another stable coin issuer uh obviously there and i thought this was interesting because one of my predictions for 2021 was that non-usd stable coins would gain a lot of traction and i mean i i i made that prediction kind of because i saw this stuff happening so there was already an an eu r uh pool on curve it wasn't incentivized but it was there and i figured okay you know this makes sense you know personally i would love to have a very liquid aud stable coin uh it's it's incredibly annoying for me to have to sit in usd and then have to take into account the price movement between usd and aud for tax reasons it's just really really annoying so

i would love to see a liquid aud market um on d5 where i could just cash into aud instead of having to go into usd and then you know have all that tax headache so and i'm sure i'm not alone here you know obviously people living in europe would probably prefer to go into euros rather than usd for the same reasons there's a bunch of other currencies like the singapore dollar you know um uh basically uh where else i guess like you have singapore dollar you have um new zealand new zealand's pretty pretty active in crypto uh the australian dollar i mean there's there's so many right there's so many different fiat currencies i do think the biggest ones are going to be you know first like euro is obviously one of the biggest ones

surprisingly you know for for for australia we're a small country 25 million people but the aud is one of the most traded uh currencies on on on foreign exchange kind of exchanges um and along with the japanese yen too so i do think we're going to see those top ones come to market first just a you know that's just a consequence of them being basically the most popular on the forest forex markets already and the most popular to trade as well so yeah i'm looking forward to more of that coming but great to see synthetics incentivizing this pool uh to get that to bootstrap that liquidity because we definitely need that uh going forward for sure so dark forest announced on twitter just a few hours ago i think that they had

passed one million transactions on the xdye sidechain in only two weeks so this is for their v 0.15 sorry 0.5 that they brought out a couple of weeks ago that i i remember mentioning on the refuel but for those who don't know dark forest is basically a decentralized strategy game built on ethereum using zk snarks but due to obviously ethereum scalability limitations they're using the xdi sidechain and they've done one million transactions on there which i thought was really really cool that's probably more transactions than any of the quote-unquote ghost chains or other layer one blockchains do um so which is which is quite funny as well uh so this plugs directly into ethereum and bridges across to ethereum

now the xdi chain uh but yeah congrats to dark forest on this and i've actually seen a bunch of people on on twitter you're getting really addicted to this game uh basically the objective is to capture planets you know grow your army of i guess like planets and your your kind of like fleet i guess um and then take over other planets and take over other players and some people are getting really into this uh like really really into this um but yeah i i think that uh in general we're gonna see more of these blockchain games kind of get more and more popular go on to these side chains um and and basically you know take advantage of the scalability that they offer because yeah you can't do this on ethereum's main chain you never will be able to it

just it's not going to work this is why we need layer 2 and side chains and i think a couple days ago i explained the difference between the two where layer two is normally secured by ethereum the ethereum main net whereas side chains are secured by their own validator set and they basically bridge into ethereum yeah so i expect to see more of these kind of games come to ethereum um and use side chains and things like that for those kind of i guess low value use cases i not sure not totally sure on this but i think maybe dark force saves your progress to the ethereum main chain if it doesn't already do that maybe it will in the future because that's a good way to basically make sure that even if for some reason the the data on xdi is corrupted or like the network goes down

you could still access your account and port it over to a new sidechain or something like that so yeah we might see that happening as well but i'll keep i'll keep an eye on that and keep you guys updated on everything so matt solomon today on twitter uh basically released this uh tool he's calling supersaurus and what this tool does is it make it it makes it easy to sweep all your ethan erc20 tokens to a brand new address now the reason why you would do this is as i think i've explained before but basically if you want to remove all of the token approvals that you've done over you know the course i guess of like months or years on a certain address it's actually usually cheaper just to move all your ethernet erc20 tokens to a

new address rather than removing them all because the gas speeds are so high removing all those approvals so that's what this would be good for it's definitely not good for like privacy or anything like that because obviously you know you send your ethernet rc20 tokens to a new address it's it's linked to your old address so don't don't think of this as a privacy solution but definitely think of it as a cost saver and something to clean up basically you know from your old address maybe there's a bunch of coins in an older dress that you have that are really annoying you that are like air drops and you can't get rid of them and you just want to start fresh right and you can do this with this with this tool which i think was really cool so yeah shout out to matt there for

building this i haven't used it myself yet but i do plan to uh because um i have like a couple of addresses that i have tokens on and i want to remove some approvals on but i just don't want to we spend that all that gas to do that so i'm going to try this out and see how it goes so loopring put out this tweet basically of their block sizes on their loop ring zk roll up now they i explained here on our quote not every chart that drops off a cliff is a bad thing our zk roll up is pumping out larger blocks today a sign of greater continuous demand more transactions compressed into each for more efficiency when ethereum l2 season really hits we're going all dark green

so for those who are watching the video you can see the chart here the block sizes i think maybe they're measured in in kilobytes maybe i'm not sure if they're measured in kilobytes or megabytes here i don't think it actually indicates that but basically you can see that the you know i guess during december they had smaller blocks so they had the blues there 16 and 64. um and then a little bit of green and now it's the majority green right and this is because blueprint has been growing or their zk roll up exchange it's been growing so fast lately i mean as i mentioned a couple days ago they've got like i think almost 100 million total value locked at this point or more than that um and this is because they're actually innovating here and doing liquidity

mining to get people to move to layer two and they're the front runner or one of the front runners because they have a working layer to exchange that is relatively liquid so it's really great to see it getting more usage and a lot of people making more use of of the the blocks that are there because i remember seeing i think matt feinstein from loop ring saying come use our exchange you know the blocks are basically empty you know come fill these blocks up with your transactions we've got liquidity for you and people are finally doing that um you know and i always beat this drum like so much is that the reason people are finally doing this is because they're sick of the high gas fees and they want the easiest and smoothest kind of uh you know process to move to somewhere cheaper

now you could of course move to another chain right but there's no liquidity there there's there's no ecosystem there when you move into a loop ring and to a zk roll up you still retain all the network effects from ethereum and you can bridge back very easily you still use your metamask you know you you still like have like a similar transaction flow and things like that and you know you still have the security guarantees of the ethereum main net so uh yeah i think that's why we're seeing this kind of explosion in growth for loop ring um and i think that i mean i've said it so many times you know when uni swap layer 2 hits we're going to see growth there synthetics is going live in three days i think january 15th there's a soft main net or a launch of optimism with

synthetics that's going to be big i'm really looking forward to seeing what they have in store there and i think after that we're just going to see you know unisop roll out chain link um maybe some other things like rv as i spoke about yesterday i think they are moving to optimism too uh and then as time goes on we have uh i guess like a lot of solutions around cross l2 composability like you know l2s talking to each other and things like that so yeah i mean it's l2 season for sure i mean they say here when ethereum l2 season really hits i believe we're in like the early innings of it and we're going to go into like a really kind of like golden age of l2 and you know it might get to a point where so many people are using l2 that the main

network um fees come down a lot because of it and then people move back to the mainnet and we have like this load balancing effect where you know when the main net's relatively cheap maybe there's more liquidity there you do some stuff there but then when it's expensive again you have your l2 solution as well so there might be a bit of fragmentation there for a little while until it balances itself out but i do think that uh it's going to be great for end users of course um and we're going to have people kind of thinking wow like we didn't know this was possible on ethereum because i see a lot of people that obviously don't pay attention to the ethereum ecosystem as closely as as i do and a lot of you watching this do that kind of think that this is it right

this is the way ethereum's going to be forever and that's not true at all ethereum is not just sitting here on its you know on its hands waiting for scaling to happen this is not i mean this is not bitcoin with lightning network i know there's development going on there but at this point the lightning network has failed to gain traction whereas ethereum layer twos are getting so much traction um and that's simply because it's easier to build a layer two on ethereum than it is on bitcoin um to to be fair but we're gonna see this happen and i think people are underestimating how quickly it's gonna happen so really looking forward to that and you're probably going to hear me talk about layer 2 you know all the time going forward because it's incredibly important and it's an incredibly exciting space going forward i think

so last thing to talk about today was a new stable queen project that was announced called fey protocol so basically i guess where this falls into the world of stable coins in terms of like categorizing it it's sort of like an algorithmic stable coin but not the ones that you are used to so i've wrote about this in the daily gray newsletter today a little bit more about it if you want to go check that out but basically what faye protocol is trying to do is it's trying to create i guess like an undercollateralized stable coin that's safe and fully decentralized so if you look at here and look through the blog post here you can read it for kind of like um the full the full detail here but basically they want to do a have a system where it only uses decentralized

collateral so if right for example um tokens on ethereum that are really liquid that don't have any admin keys or backdoors like link for example they don't want to use wrapped bitcoin or usdc or things like that because they want to remain as decentralized as possible now obviously we had dye previously that was you know obviously the first decentralized stable client but at this point because of the fact that it's backed by so much usdc has wbtc in there even has tether i think in there um it's not fully decentralized anymore so you know incomes faye protocol but that's not the only thing that they're innovating on as i said they they're they're an algorithmic stable coin so they're basically trying to you know contract and increase the

supply based on a bunch of different market mechanisms uh i mean it's it's detailed here i'm not going to try and tldr on on the on the refuel because i i it it does require you to read through this because it's a relatively new mechanism here um but and it's also trying to be governance minimized so there is a governance token but it's supposed to be um governance minimized so that there's not like uh the governance doesn't need to do much to maintain this sort of thing it doesn't and and most of the time the uh kind of like coded in um algorithms and and logic should take care of the stability of the of fae the stable coin uh on its own it shouldn't require human intervention

so very very very uh i guess you could call it ambitious project here i think uh and i think that it's solely needed because we already have very popular centralized stable coins and they're easy to do right you issue a token on ethereum that's backed by the us dollars in a bank account done make a dell is a kind of an amazing attempt at this it has issues now with decentralization right because of the the centralized assets in there it sometimes has issues with its peg but i wouldn't count the peg issues as like a make or break i'd say the the fact that majority like 40 percent of dye is backed by usdc is more of a make or break for me than uh i guess um the fact that it's uh it's not stable all the time but you

know that's a different model as well it's it's it's collateralized with people that want to basically you know draw die against it to do whatever you know do whatever they want whether that's going leverage along or using it as a as a stable coin in its own right whereas faye protocol is trying to do something different here so still very early stage here was just announced i think their twitter account's only been out for a few weeks so definitely go check out the full blog post and give it a read if you want to learn more about it i think this is sorely needed because we can't have a defy ecosystem or a decentralized finance ecosystem that runs on centralized assets right we can't just have the entire kind of thing running on tether and usdc because then their choke points their

central points of failure because stable coins are some of the most used assets on ethereum if not the most used assets on ethereum and within d5 so if the kind of us government could just go to coinbase and say hey we want you to freeze all of the usdc in make it out right well there goes 40 of the collateral that's uh backing uh die like uh instantly so that's just you know that's not great that could lead to some very very bad on-flow effects for d5 considering that diet should logically after that gets frozen should trade at 60 cents which means that people are going to get liquidated right um uh people the the kind of like amms will all go out of whack you know arbitrage

bots are gonna make a ton of money probably if they're set up to take advantage of this a lot of funky stuff would happen so i definitely think that um we we need something like fey protocol don't know if it's gonna work or not maybe it doesn't work at scale but interesting to see i'm very interested to see if it does and i'm interested to see more experimentation here with actual kind of algorithmic stable coins that don't look like ponzi's now i'm going to get in trouble for this but the the ones that we currently have definitely look like ponzi's right maybe they're not maybe they're not meant to be and maybe they're not meant to be scams at all and i'm not calling them scams or fraudulent but a lot of them rely on new capital coming in to maintain their stability and basically

the game kind of only works if the uh the coin is below or above a dollar to encourage people to put more money in the system if it stays at a dollar forever then it can't grow because no one is incentivized to put more money in the system at least that's the current crop of them so i'm sure there's going to be projects that keep experimenting and i and i welcome this experimentation but until they're actually stable i think calling them stable coins is a bit misleading i guess you could call them pre-stable coins or you know attempting to be stable coins but the current iteration of many of the algorithmic stable coins are not stable at all and they probably never will be in their current designs i don't know if faye protocols or fey um the token itself is going to be stable

in the long run we have to just test these things out and experiment so yeah looking forward to fey protocol going live i think they're aiming for an end of q1 launch so pretty soon basically march so we'll definitely see how that goes uh over the next couple of months all right that's it for today's refill everyone thank you for listening and watching if you haven't subscribed yet definitely uh do so on the youtube channel uh give the video a thumbs up join the discord channel and subscribe to the daily great newsletter and i will catch you all tomorrow thanks everyone