Modern rollup-centric roadmap, Ethena goes live - The Daily Gwei Refuel #734 - Ethereum Updates

Transcript

hello everyone welcome to another episode of Da we refuel where recap latest news in ethereum ecosystem I'm your host and this ISO and today the 20th of February 2024 all right everyone let's get into it so just before we get into it actually just wanted to make note that I uh changed a bit of kind of uh things with my microphone setup a bit of settings around so hopefully the audio quality is better and the sound isn't too low or anything but yeah that will probably be the explanation if the sound levels that you usually usually listen to the refill on have changed it's because I've actually changed my setup it's got nothing to do with your own kind of set up it's all me so just let me know if there's any issues with it but I tested it pretty extensively so it should be fine but yeah let me know

if if there's any issues there if it's too loud or too quiet or anything like that and I'll see what I can do from there anyway moving on to the news over the last 24 hours so lots to get through as usual kicking off today with a post from Mike nuda and Alex Stokes here I think those are the two main authors on this post uh yeah yeah uh that was posted 4 days ago but was only shared on Twitter today and it's called Uh the rollup Centric road map 2024 version and essentially Mike describes it as uh a modern rendition of the rollup Centric road map that vitalic obviously posted about quite a while ago now the original rollup Centric road map I think was posted four years ago or something like that I no over three years ago as as Mike notes Here says it's been over

three years since falic put pen to paper voicing a rollup Centric ethereum road map uh and there's obviously been a lot of changes in the interim uh but there hasn't been kind of like a modern version of the rup Centric road map uh kind of put out there and that's where Mike and Alex come in to basically put this together and have this as like a basically a living and breathing document I I think of basically following along with the changes happening on the rollup Centric road map for ethereum and and obviously everything going on on the L1 side of things there's actually a lot of stuff in here I read through it just before it's uh it's it's honestly really great I think that the I mean the core idea of the rollup Centric Ro map hasn't really changed right we we're going with like

roll ups and layer twos generally I think the biggest change probably is the fact that we aren't just doing like rollup Centric we're doing Layer Two Centric right because obviously to be a full rollup you need to post both your kind of like proofs and data to to the same layer in this case L1 ethereum but you can also be considered a layer to uh if you're a validium which doesn't Post Its data to ethereum right it post its data somewhere else whether that be a data availability layer or data availability committee it doesn't just post it to to e L1 there so I think that that's maybe one of the biggest kind of evolutions uh in in in terms of kind of what the rollup Centric R map actually encompasses but there are so many other things right there are things around meev consideration uh you know how

staking works with regards to the rollup Centric road map censorship resistance you know decentralization all that and and the different stages of the rops too that vitalic has also written about in the past so this post basically aims to just modernize what vitalic originally posted back in I believe it was 2020 I mean they they do link to the worldcentric road map here I believe it was yeah October 2020 that's what I remember remember so I mean it's going to be 4 years in October this year since this was posted and I think obviously we're making a lot of great progress on the layer 2/ rollup side of things but I think that uh you having an updated kind of document that follows along with all the kind of bleeding ede stuff that's happening in the ethereum ecosystem when it comes to the rollup Centric road map

is definitely a great resource to have so I'm not going to kind of uh go on too much about this because it is just a document that I highly recommend that you guys read uh and you know I think that is just something that everyone needs to be on top of if you want to be studying ethereum studying how it's scaling and being able to you know explain it to other people as well because obviously ethereum has a more complex scaling road map than some other kind of chains out there you know obviously ethereum is not trying to do everything on layer one whereas a lot of these other kind of Monolithic chains are trying to do that and there they're I guess by Nature easier to explain than the rollup Centric road map but as we know you know the only sustainable kind of way to build a blockchain is through

the modular approach and the modic approach is not long-term sustainable and there's no way you can do everything on one layer and I mean I say that's like we like we know it as a fact I mean I believe that is the case I mean I don't know if we could say we know it as a fact right now I mean I I I personally would say that it's a fact but there are obviously people who disagree with that so I'm not going to say like it's a sure thing but I think that you know as the years have gone by the rollup Centric road map and the modular kind of road map for blockchains generally has just caught the mind's share of most of the ecosystem even though it's more complex you know inherently more complex it's still something that I think a lot of

people have a lot of um know drive to to to work on and improve and they really do view it as a long-term sustainable solution uh for for scaling blockchains Right Moving On so Tony shared EIP 7623 which is an EIP to increase call data cost so you guys know that call data right now is predominantly used by rollups to store their data now of course post denune they're going to be storing that data in blobs or call data and I think the whole point of increasing the cost of using call data is to basically Al push um you know push people push the rollups towards blobs uh and decrease the overall block size of of ethereum or sorry decrease the maximum block size of ethereum in order to basically increase

blob sizes so essentially we're basically trading off Co data for blobs at least that's from my understanding here and Tony kind of describes what uh describes it in his tweet here where he says you know make room for Block gas limit and blob count scaling so essentially be able to increase the gas limit of ethereum blocks as well as increase uh The Blob um the blobs on the network and uh C data is definitely you know po enun going to be the inferior place to store data because uh blobs have been specifically designed for rollups C data is just like a happy kind of thing that was there that rollups could use but it really isn't fit for purpose blobs are the thing that we're going with so it would make sense to increase the cost of Co data here in order to make that an economically

rational thing for rups to do cuz I did say that you know at least in the short to medium term until this EIP gets implemented into the the network what can end up happening is you have Arbitrage opportunities or at least kind of like a pingpong between C data and blobs depending on which one's cheaper right and because obviously cold data and blobs can be used for things other than rollup data it can be used for things like inscriptions uh we may see spikes here and there and then we may see kind of rollups uh you know switching between the two and it just becomes very very messy it's not a very clean solution so that's why this EIP has been proposed here but as I said it is just a proposal right now it only got created on the 13th of Feb so about a

week ago you can read through it yourself if you'd like to but both Tony and vitalik are the authors of this EIP and I I definitely think it's something that will end up going into the network maybe I don't know if it'll be part of pectra it may end up being part of like the upgrade that goes live next year so the Osaka I think it's called right now I'll tentatively name the one after Petra uh but we'll have to see right Petra is already a pretty stacked kind of upgrade right now even the things that aren't included yet you know if we just included a few more of those it's pretty stuck so so definitely keep uh an eye on that I mean sorry I'll definitely keep an eye on that for you guys and let you guys know how this is going but this

makes a lot of sense I think given that we now have blobs or will have blobs in the very near future that uh rollups are going to be using instead of Co data so there's no reason to have Co data be so cheap and also at the same time core data is actually too cheap I I think that the cevs have thought about this for a while that it's actually too cheap for the amount of I guess like resources it uses on the network so it's really just a resource kind of repricing here and this has happened to other uh op codes on the ethereum network this is not the cold data is not the first one to go undergo this treatment and really it's just to basically have you know fair pricing and I guess fair is subjective but essentially fair pricing uh for the different op codes on the

ethereum network so that we can have a more efficient and stable Network overall all right something that else that Tony shared here is just a screenshot of one of George's uh cast on farcaster where he said I think somebody will need to figure out how to connect account abstraction with stealth addresses plus hiding payment amounts gas sponsorship will let anyone pay for your transaction batch transactions will mean you can spend from multiple authorized stealth addresses solving the fragmentation and Tony basically shared this saying that Georgia is giving us a glimpse into the future imagine a world where we have account abstraction plus utxo like wallets plus stealth addresses uh that will provide end user privacy without requiring any sort of mixing now of course I highlighted Tony's paper the

other day of of stealth addresses and stealth addresses is something that valalik has spoken about before as well but it's basically a way to get privacy without having to do any kind uh kind of mixing whether that be on ethereum L1 or L2 and I think that eventually it could become the default way to interact on chain we all know that everything you do pretty do on chain today is completely public you know there are massive companies like chain analysis and Arkham intelligence that will basically de animize the entire chain they use a bunch of heris not just the onchain footprint but things like you know what times you send transac actions where it looks like you live in the world you know do you have a public presence all that sorts of stuff right so that can all be linked but the hope is that with

something like stealth addresses mixed up with account abstraction and utxo like wallets you can get to a point where essentially the default way of interacting with onchain kind of um onchain things is in a privacy preserving way without having to use a mixer because obviously using a mixer I mean at least with tornado cach right now it's obviously illegal for US citizens and persons to use that and it is a great area for other people around the world um but generally I would say that mixers require you to actually go out there and and kind of like mix your funds it's not it's not the default right like you have to go to tornado cash you have to put your funds in you have to uh basically wait for the the whole thing the whole process to to go through and then withdraw them to

somewhere else it works you know it works wonderfully it actually works so well that I guess like the the US decided to sanction it because it worked so well and they couldn't Trace where the funds were going um but that is not the that's not the way people are going to be getting privacy on chain I think or at least most people I think most people are going to be using things like stealth addresses where it's just built into their wallets and just easy for them to use you know imagine there's a toggle like do you want this to be private or do you want this to be public uh and imagine the costs are I mean I'm not going to say the cost the cost could be the same I think that the whole point of stealth addresses might be that the cost can be very similar because cost

has actually been a big issue around privacy before is that it's normally more expensive to do anything privacy preserving on chain because it requires more computation to do that but obviously with the Advent of things like layer twos that collapses the cost down and we have layer twos like Aztec working on you know fully private uh kind of uh layers here but when you kind of think about it from the end user perspective and if they've just got a toggle between like you know do you want to send this transaction privately or do you want to have it publicly I feel like most users would just select privately right like um and it would and honestly like a lot of wallets may end up just having it as the default thing and then it's buried in the advanced uh kind of advanced settings of the the wallet so

uh in there just a simple interface it's always private by default but then if you want to change it to public for whatever reason maybe you want to have it public on your public address because you want to flex some nfts that you're you know trading or something or maybe you're trying to S up the market by moving money around and making it out as if you're selling or buying when you're not really doing that right there there there are reasons why you don't want to be kind of like hiding your transactions but I think for most people they definitely want would want to be uh kind of preserving the privacy of their transactions especially if they're sending you know relatively large sums of money around uh and and that's just not what we have today besides tornado cash and maybe some other kind of very

small mixes here and there we don't have anything like that on ethereum uh today but it looks like we just may uh in the kind of near future hopefully so yeah um I guess kudos to Tony for highlighting this and georgeos for putting this out definitely something something to think about all right so a lot of you have been wondering when the various l2s or I guess like various rollups are going to be taking advantage of AIP 4844 blobs like will it be day one uh when they go live as part of denune or will it be the week after will it be the month after well Wesley here has been tracking each of the l2s or each of the rollups here uh and basically has a list here of the ones that are going to go live on day

one so it's already confirmed that arbitrum 1 ZK sync and Stark net will be using blobs from day one uh a few days after will be optimism base and all the op stacks and super chains and he said here not ready yet is scroll and then you can see the sources that he in his tweet but then there's also a few replies here from people like tog Ru from scroll saying that they should be ready in early April so 3 to4 weeks after activation uh Tao will be going live pretty soon after 4844 and a bunch of other kind of replies here like fuel network will have support at launch and so on and so forth so yeah I mean I think for most people the most relevant obvious obviously arbitrum and maybe optimism right now cuz they're the most I guess like used l2s and and ZK sync

probably probably too uh but yeah I mean they're going to be live like very kind of shortly and I think there's competitive pressures as well because if you if arbitrum one goes live right and then then they their fees Drop Like by I don't know drop by like 90% or something I'm just throwing at numbers here obviously you guys know that we don't know the exact amount it's going to drop by but let's say you know arbitrum drops by like 90% And then optimism is still the same well obviously there's a competitive pressure now where optimism is like oh my God we have to do this right we have to drop our fees because arbitrum is so so much more so much cheaper than us now so I think we're going to see that kind of uh play out relatively quickly but honestly I would

say most of the rollups are going to be supporting blobs within at most a month from them going live so it's not going to be it's not going to be a long wait there at all and I think that it's going to be uh super exciting to actually see what the fees look like right and I've said before on the refi plenty of times that we're going to have when it go first goes live obviously and then then we're going to have like the weeks after and the months after and we're going to have to do a kind of analysis on that and see what the average fees are to get a clear picture of the impact of 4844 and I'm also very curious to see what the impact is on layer one gas like l2s or rollups they still don't take up that much of L1 gas I think at most they take

up like 10% of all L1 gas usage per day so there's still 90% that's used by just L1 right not by by by any of these l2s or rollups so it's going to be interesting to see uh what happens there like are gas fees going to go down by like 10% or something I mean gas fees can fluctuate wildly during the day on L1 anyway so I think that's just going to be a wash to be honest I don't think you're going to be able to have like point to any kind of specific kind of lowering of fees and there is that concept of induced demand there on layer one too and and layer twos as well but more so more more pronounced on on layer one but yeah that's kind of like how I how I view it and uh I'm just I'm just

really excited to see how it's all going to play out there but yeah kudos to Wesley here for putting together this list all right so I remember I talked about this I think last week Justin Drake has started a new ethereum sequencing and pre-confirmation call Series so uh there was uh pre-confirmation call number one and here there's a video that's now shared as well as a bunch of notes that were taken uh with and there was a a 15minute technical presentation with a 45 minute Q&A so if you're interested in learning all about that I'll link it in the YouTube description below but I just wanted to shout this out to put it on your radar because you may have missed it here um but yeah the notes and the videos everything will be available in the YouTube description below all right so I came across this

stat that I kind of worked out today which was kind of crazy I mean I've worked this out before but I was just thinking about it today I'm like you know what let me work it out again so I put out this cast on farcast AO said almost 31 million eth is staked which is about 25.7% of the total eth Supply this is 90.8 billion worth of eth which is larger than every other smart contract layer 1's market cap eth as an asset is in a league of its own like just just kind of think about that for a second guys like just the eth staked and it's only 25% of the total eth mind you right there's still 75% that isn't stake so so just 25% of the eth that is stake 31 million eth is worth let's say $91 billion the next

closest smart contract uh uh platform is Sal I think at $48 billion right so I guess like the amount of e Stak do almost double the total market cap of of salana there and then you can go down the list and see the other ones like cardano at 22 billion Avalanche at 14 billion so on and so forth and the reason why I wanted to highlight this is because it really just shows like how eth is an asset is as an asset is in its own league right it doesn't even have anything that holds a candle to it in terms of value I mean E's total market cap is $350 billion which which is more than the combined market cap of all the other layer ones put together and then some I mean I think the combined market cap of all the other layer ones put

together I don't know exactly what it is at the top of my head but I I think it's like 100 billion and even if it's like 150 billion that is still way less than 350 billion that's that's that's still you know less than half than 350 billion that's all of them combined right um but then you just look at the amount of e that he staked and it is way less than these other networks because these other networks have delegated proof of stake which you know obviously you can just like delegate your stake and it's not in my mind real staking honestly I feel like it's just like a fake staking I've always thought that about delegated proof of stake but there's that right uh and also these networks don't really their assets aren't really used for much other than staking so they have high

staking rates but their values uh their market caps are very low compared to something like eth because eth is obviously used for things Beyond just staking I mean it's used for so much more than staking right but just the Staggering difference between the numbers here is something that I wanted to highlight for you guys and it's something that I also like to highlight when people say oh you know all these other things have been outperforming eth over the last 6 months or whatever it was and I I I feel like saying to people I'm like yeah but do you realize like how just how big eth is as an asset compared to these other things I mean you're comparing 1 to10 billion market caps to something that has a $350 billion or $300 billion market cap it's obviously going to require a lot more money to move eth in either direction

and that means that like in a bare market for example eth performs better and it has performed better than these other things I mean these other things that have performed better than eth over the last six months got absolutely destroyed in the bare Market they went down like 95 plus% guys eth only went down around 80% I believe from from memory now obviously you know me saying eth only went down 80% these other things went down 95% is is funny but there's a staggering difference between 80% down and 95% down so let me let me just illustrate this uh for you say you put $100 into something and it goes down 80% you have $20 left if you put $100 into something and it goes down 95% you have $5 left and I know this might seem uh silly for me to explain to you guys

but that's the that's the Stag staggering difference there you have four times more money left uh going down 80% than you do going down 95% right and you can increase the numbers and make it look even worse like say you put a million dollar in well you've got $200,000 left um if you if you lose um 80% uh and then you've got $50,000 left if you if you lose 95% and then it just keeps getting exponentially worse from there like if you go down 99% you have $1,000 left right um so you know when you sorry $10,000 left so when you think about it kind of from that perspective uh there's a staggering difference between that uh and and eth really is a much stronger asset on the downside uh but also obviously it is um you know potentially weaker over the short term

on the upside because it takes a lot more money to move it but it is just like so much more valuable than these other things so yeah just something to keep in mind uh and I obviously viously think that the amount of eth that he staked is going to keep going up I think that with the Advent of reaking with the Advent of a few other things coming online the amount of eth going you know Stak is probably going to keep creeping up all bull market and then it's going to be really interesting to see what it looks like maybe I guess six to 12 months into the bare Market because there will definitely be a blow up at some point guys like the bull market gets too crazy people blow themselves up on Leverage we probably see some lsts you know I mean it's not technically a

dpeg but we see probably see some LST lsts and lrts coming off of their fair value and then everyone's trying to do Arbitrage and trying to make profits between between that but really this it's the little guy that gets wrecked cuz they don't know what they've got themselves into they don't know the risk that they've taken on so there's going to be a lot of volatility there but I I don't know how like what the net result will be for the amount of e stake like are we going to see like a mass withdrawal from the beacon chain we'll have to see right ether staking has not existed in a bare Market uh uh sorry in in a a full Bull and Bear cycle uh the way it exists today because it launched December 1st 2020 like halfway into the last bull market uh but eth staking was

very closed off back then there wasn't really any uh there wasn't really much eth at stake at all there weren't really many options uh to stake you know it was a solo staking or you could go with some centralized exchanges offered it like uh it's like Celsius offered it I believe really early on U but we all know what happened with Celsius uh and then lto came along but really it's built up a lot over this bare market so now we get to go through a whole bull market we have reaking which is new as well and a few other things which are new and then that will of course flow into the bare market and have to see just what happens there and how much how much things get blown up there I mean I don't want it to happen but I kind of know that when the

maniac hits people lose their their minds and they lose their kind of uh I guess like uh view on risk and they kind of just keep going out the risk curve because it feels like you're going to be making money forever uh and that's definitely not the case but yeah we'll see we'll see what happens uh there but anyway enough on that one I'm going to move on to the topic that I wanted to spend a fair bit of time on today because I saw a lot of people talking about this uh and it's Athena so you may have heard about this project on Twitter today Athena um which I have talked about a bunch on the refi before you guys know I am an investor in Athena here uh but the reason why people are talking about them today is because they launched their public main net and they

have a kind of points campaign going on as well now the reason people are talking about them is I guess like because a lot of people are comparing Athena to Terror and the reason they're doing this comparison is because Athena has basically said that they're going to be offering 27% yield on their stable coin which is usde now of course and naturally uh especially given that we saw Tera blow up after offering 20% yield on USD everyone suddenly like oh my God we just reinvented Tera it's a new Ponzi you know how can you be offering 27% yield you know so on and so forth without actually understanding what the actual product is so what I want to do today for a few minutes here is I actually want to run through what the product is

I want to explain to you how it's different to us and I want to explain to you that how it's completely different when it comes to the failure cases to to something like us and and all the risk involved but first I have to obviously disclaim and disclose I am an investor in Athena but as I said on my tweet here uh I I put a small check in uh because I lik the founder and thought that the idea was worth pursuing and uh I do want to say that the small check I put in I'll put a dollar amount on it it was $10,000 uh that is small for me like I'm not trying to brag or anything like that but that is what I consider small in in in terms of like what I invest in terms of Angel Investments or public market

Investments that is a very very small small check for me I put that in because I really like the founder he's a super smart guy very honest like we got along really really well uh he's always open to feedback he doesn't have an ego about him like I just really liked him like you know what like I I can see where there's a lot of issues with or a lot of potential issues issues with something like Athena and one of the first questions I asked him on the call that I had with him was like is this collateralized cuz that was like my biggest thing because as soon as I heard of this I straight away went to to Tera as well I'm just like okay you know I know what happened with Tera I I'm going to be care with this I'm going to

actually kind of do my my diligence here and investigate what's happening and that was basically one of the first questions I asked and it is but I'll get into that in a sec here um but uh I also put out in this tweet that I said that I'm happy to see people actually questioning Athena's claims because it means that we're getting healthier as an ecosystem it means that the ecosystem is becoming more mature and we're not just taking these things at face value we're actually questioning them so in saying all of that now we'll dive into exactly what it is and I think the first thing I need to explain is where does that yield come from where does that 27% number come a 27% number come from right well it break it's broken up into two different parts there's 4% which is the uh eth staking yield so usde is

catalized with stth uh partly catalized with with st e which is offering currently around 4% right so that's the eth staking yield uh and they expand they plan to expand to other lsts and lrts and so forth but right now it's just St so that's 4% there and then the other 22% comes from the funding rates on centralized exchanges that people are paying to be short on eth now currently that's 22% now that can fluctuate so can the eth staking rate right so this 27% number is not something that is guaranteed to last at all this could go down a lot from here right this could go down to to negative actually that's the way funding rates work on on um on these per exchanges uh and now in in saying that as well I want to I want to make

clear here that the uh usde stable coin is not decentralized at all it uses centralized counterparties uses the centralized exchanges in order to pass that funding rate or at least kind of wrap that funding rate up into this stable coin so a better way to think about usde is not as a decentralized stable coin but as a centralized stable coin that is trying to compete with uh usdc and usdt uh while also offering a yield to the people holding it and to people using it because as you guys know the way Circle and tether make money is that they just have dollars uh and treasuries in a and and other similar assets in bank accounts are backing their stable coins but they keep all the yield for themselves and this is why tether is I believe the most profitable

company uh in the world based on a per employee basis they don't have that many employees but they make a lot of money because right now they're getting paid you know that risk-free rate from the FED in in and from holding uh us treasuries right and they're getting paid like whatever it is 4% I don't know off the top of my head whatever it is right now on tether's market cap basically which is almost $100 billion so they they're making a lot of money right um and and and and so is circle with usdc even though usdc is smaller but they're not passing any of that onto the user so when you're holding a USD stable coin you're getting nothing on it just holding it right you can obviously put it into a money market uh or or lend it out to you know someone you know

maybe they'll pay you interest or whatever obviously you can do that stuff but just holding the coin itself gives you nothing whereas the whole idea with USD from Athena here is that it breaks these kind of like Perpetual funding rates and the eaking yield into this to give you a really nice outsized yield here now of course there are a lot of risks associated with this guys like I'm not going to say sit here and tell you that there aren't risks associated with it there are first and foremost one of the biggest risks I think uh is the fact that it relies on centralized exchanges so if one of these centralized exchanges was to I don't know go under for some reason right that would mean that it would technically be under collateralized I I don't know I wouldn't say that that's like like completely

correct terminology but it would mean that essentially uh there would be a hole right there would be a hole to be plugged because of that and and also um not just a centralized exchange blowing up but let's just say there is a massive unwinding event of positions where there's not enough liquidity to meet those positions and then people blow up and people end up owing money and then um you know it needs to be paid out of some kind of Insurance Fund which we've actually seen happen on places like bitmex bitmex has a very large Insurance Fund that's nominated in BTC and whenever there is some kind of like um a massive blow up or something goes wrong maybe the exchange kind of uh uh has a bug in it or has a glitch in it where the the pricing is wrong whatever it is

they use that to cover the losses there so that is another risk here the another big risk which is very uh I guess like native uh and very uh unique to uh to not not not sorry I shouldn't say very unique to USD usde um not I should say not unique to usde is sste uh dep pegging so to speak so let's just say the uh we get the repeat of what happened in after the terror collapse ironically after the teror collapse um in 2022 with where St actually traded at a discount to its fair value I think the discount was what 0.9 so you could buy 0.9 St and then uh you could get one eth from the beacon chain but at the time there was no withdrawals enabled on the beacon chain

so you couldn't actually do that Arbitrage but now there is so I I think that the the the kind of like dpeg will be less steep because of the fact that you can do this active Arbitrage but at the same time there is still a possibility of that happening in a in in an unwinding event so really most of the risks are centered around the fact that there can be Mass deleveraging events in crypto that we've seen time and time again that can lead to bad debt in you know in in in uh the Athena protocol because it's basically a wrapper around the centralized exchanges around things like St and that can lead to eventually uh losses for for end users here and the other big risk is that if funds go negative and they stay negative for too long it essentially means uh that the um

the I mean I'm not going to claim I'm an expert on what can happen here but it essentially means that you're basically losing value because you're not you know you're not getting 27% yield anymore you're getting like negative yield essentially and you're basically bleeding value out from there and the protocol is bleeding value out from there and unless the funding rates go positive again uh the whole system uh I think runs the risk of becoming or again under catalized probably the wrong term here but basically having a debt that that it owes here so those are other major risks now at least from my understanding there may be others that I'm not aware of here Athena actually has a really really great website really great FAQ section really great documentation section where they go through all this so I highly recommend

checking that out I just realized I'm at 30 minutes well I went for a while there but I really felt that this was important to explain to you guys just the last thing I want to say about about Athena here is that when comparing it to to Terror the reason why I think that it's a really dumb comparison is because and specifically us is because us was pretty much like all all almost all of it was under collateralized and it completely relied on an algorithmic Ponzi mechanism to basically stay collateralized because as us D pegged more Luna would be printed and then you'd sell off the Luna to to reeg us but if us did never repe never went back to a dollar you just kept printing more Luna and then what happens when you keep printing more of that token and selling

it into the market the price keeps going down right so you have this death spiral that ends up happening here so the thing that killed Tera was that that PO point of it that kind of like death spir but also the fact that it was just under collateral ized whereas in this case unless something was to break unless a centralized exchange was to go offline or some kind of bad debt was to form because of some Mast leveraging event or U you know the lsts that they're using dpeg for long periods of time because it can always repe right and it could be okay then uh it won't become under collateralized it it won't it won't ACR bad debt it will essentially uh fix itself so so to speak here but those are the main risks as I see them and why they're definitely not the same thing as

Terra here now in saying all that please please please do not get involved with this protocol unless you know what you're doing you need to do your research on stuff like this guys like I know that a lot of you are not Traders a lot of you do not understand how funding rates work how perpetual's products work you this is a very new protocol here I know it may seem exciting to get involved with it because they've got an airdrop campaign and you might get an you know you might get a token air drop later down the line or something like that if you want to do that if you want to be a Deen as we say do it with a money that you can afford to lose because this is brand new stuff it's untested at scale um and it definitely carries a lot of risks with it so that's

my only kind of like uh plead to you guys is that please make sure that you know what you're getting yourself into if you go into this and I've done my best to explain the risks here you guys know I'm an investor but hey like as I said I'm invested because I thought the idea was interesting I really like the founder but my my investment in it should not be taken as an endorsement it should not be taken as something that you have to go ape into because like it's backed by you know it's backed by Anthony he knows what he's talking about you know let's AP in no please none of my investments are like that like I'm taking the risk by putting money in obviously I'm taking reputational risk as well by putting my my weight behind this sorts of stuff that's the risk I'm

taking but uh you know I I I'm taking that with the knowledge that I could lose I could lose on this and and then I lose my money and and I take a reputational hit and honestly every time I do an annual investment I actually mentally write it down to zero I have a spreadsheet where I track everything I know exactly how much money I've put into all of these things how much money I've made from them uh so far but I basically write down every single one to zero from the moment I put it in I don't write it down officially obviously if I wrote it down officially I'd have to do it on my taxes and things like that but mentally I say okay I put money into this I think it's a cool thing a cool idea I like the team you know so on and

so forth but it is worth zero until one day I get some tokens or maybe I get some Equity here or maybe the company gets Acquired and I get a share in that whatever it is but because they're early stage Investments because I understand that they're very risky I do the mental thing of writing it writing it off to zero and then whatever happens happens whereas if you're investing you know in in in this stuff and putting your money into it and putting it in uh you know say you put like uh $1,000 into this protocol uh because you want to try it out because you want to airdrop Farm just come to terms with the fact that you could lose all of that right based on either the mechanism underlying mechanisms of any protocol you interact with or based on Smart contract bugs uh

and so on and so forth right or or hacks and things like that so I think that's just my my final piece of advice there and as I said I've gone overtime here just wanted to say there's another tweet from Conor Ryder who is the head of research at Athena that does a great job explaining all the things I just explained in a uh in a better way with nice little graphs and charts for you to look at so I'll link that in the YouTube description below I I definitely highly recommend reading that but as I said the Athena team is extremely open to feedback they have always been great whenever I've talked to them uh you know mostly the founda whenever I've asked questions I think they have a Twitter space is going on on Thursday as well that you can ask questions uh on but

they have a Discord channel that you can join too so definitely if you have questions if you have feedback go let them know there's no egos there guys like I have not felt any kind of ego coming from the founder of Athena and as you guys know I hate people with EOS like I still clear of them and that's uh you know that's that's that's honestly a major reason why I'm so excited for Athena is that it is something that is untested it is something that could go wrong based on all the risks I outlined but you know it's something new and interesting it's something that I think is falls into what I want to see in defi like you guys know that I've been talking about wanting to see more Innovative stuff in defi uh and as long as the risks are disclosed as long as

the team takes the feedback on board and they aren't egotistical about it and all that I think it's fine uh but yeah I think that's true for what atheno is doing but as I said you can read this tweet go join their Discord channel uh and get to know what they're doing here all right just last up quickly just wanted to shout out that the daily gay farcaster channel hit 1,000 followers today so thank you everyone for following the daily gay channel on farcaster and obviously following me on farcaster as well it's shaping up to be a really nice Channel we have a lot of um you know great posts in here some conversations some feedback on things you know people posting things like uh this sticker eth's this eth's money sticker um you know that uh that that is on someone's car here this was actually

a sticker that was done under ethhub ages ago so it's it's kind of like OG here so yeah it's just like a cool little channel for the daily Way community to hang out in obviously there's a Discord Channel as well the links in the YouTube description below to that uh but yeah just wanted to give a shout out that we reached 1,000 onto onto 10,000 next right guys but anyway on that note that is a really long episode for today so thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give a thumbs up subscribe to newsletter join the Discord Channel and I'll catch you all tomorrow thanks everyone