Is The Multi-Chain Future Already Here? With Preston Evans

Transcript

you're trusting users with like, hey, here's this USB stick that's got a million dollars on on it. You've got to decide like, do I keep this plugged into my computer and then hackers can basically get out of it whenever they want or do I not keep it? And then every time I want to like send 10 bucks to a friend, I've got to go upstairs, get it out of my safe deposit box, you know, whatever. >> Like, how would you launch an application in crypto today? Why do we need more than one client? >> As far as we know, we're kind of the only stack that gets out of your way and just lets you build the things that your users want. Welcome back to the Rowup. We are your hosts. I'm Andy. I'm Robbie. And this is your home to learn from the biggest

guest, the brightest minds at the tip of innovation. Our goal is to help spread the collective knowledge of everyone in our community. We are breaking crypto out of its echo chamber and taking it to the real world. Welcome, Preston. First time on the rollup, man. What's up, man? How are you? >> Doing great. Thanks for having me on. >> Hell yeah, man. Where are you calling from? Uh, >> I'm in Nashville, Tennessee right now. Oh, dang. Big big weekend ahead, huh? >> You know, I actually live here, so probably nothing too crazy. A lot of a lot of code to write this weekend, I'm afraid, but it should be good.

>> Mostly vibe codings. What are your favorite AI tools to help you vibe code it? Try out uh GPT5 yet. >> I haven't played with GPD5 yet. Uh probably probably over the weekend I'll get a little bit in. Uh I mostly use Cloud Code these days, although I also have Cursor. Um but I found Cloud to be the best at least lately. I used GPT5 yesterday to build a flyer for a party invite. It was pretty sick. It was really, really fast. That was my first >> AI. Yeah, >> it was really silly. It was like I I told it what to do like exact text and it misspelled three words four times. I had to send the same prompt four times to get the right text. It was really

weird. Um, >> that's really funny. Early days, I guess. >> All right, Preston. quick background on yourself, man. Would love to understand like who you are, where you come from, how you got into the space, some of the stuff that you're most passionate about, your general thesis on the space, just like broadly, first time on the show, introduce yourself to our audience. I'm sure a lot of them know you kind of through uh mutuals, etc., but Rob and I don't, so um yeah, would love to start there. >> Perfect. Yeah. Um so, yeah, I'm Preston Evans. I'm the CTO at Sovereign Labs, um, where I've been for the past three and a half years or so. Uh, before that I was over at Amazon Web Services doing some of their crypto stuff. Uh, and before that I was in school and doing

some open source work in my spare time. Um, so I've been kind of broadly in the crypto space for forever. Uh, I always tell people I probably heard about Bitcoin back in like I don't know 2013 or so. Uh, and was always like vaguely interested in it. I was still, you know, in middle school or high school at the time, so didn't do that much with it, but sort of became technical through learning about Bitcoin. And I remember watching Ethereum launch, watching the Dow hack, all that stuff. Um, so what I'm really interested in is kind of pushing the frontiers of what's possible on chain. Um, from the very early days, it's kind of been obvious to a lot of the cypher punk people that if you can make everything in the world go on chain naturally. If you could fit anything you

wanted on chain, then there's lots of room to make a better world. Um, but the question has always been like, okay, but how do we actually do that? You know, Bitcoin does seven transactions per second or something like that. Ethereum's in that same ballpark, low tens of tens of transactions per second. And so at those rates, you're just never going to bring useful things on chain, right? For beyond very core financial applications. So I've always been interested in like how can we bring other stuff on chain and just have a less intermediated world, let people interact more directly with the people around them. >> And are you uh are are you like are you consider yourself a libertarian or not really?

>> Uh I would say I'm maybe more libertarian than average, but not a hardcore libertarian. Uh, I definitely think there's lots of room for government to do useful things in society. Uh, but I would also love to see like lower taxes, more freedom for individuals to choose their, you know, what they want to do, all those sorts of things. Um, but one of the things I love about crypto is that it sort of works well regardless of your political philosophy like like >> crypto is really like it's okay in the states. It does some good things for us here in the States, but where it really matters is like if you don't have a functional government. And so um you know if you're in Tanzania or Uganda or any of these countries where on any given day like anything about your your built environment could change the legal

system may work great for a while or may fall completely apart depending on what happened in all sorts of places you know close by or far away. So anyway I'm excited about being able to just like you can build a system that just works and then anybody can opt into it and that's really really powerful where right now you can't really opt into a different government. This is the network state model >> a little bit. Yeah, I think those ideas have been floating around in the ether for a long time. Um, you know, apologies may be a little bit more like he wants to build a real physical state as well or at least like an elomeration of people. I think thinking of this as a state is maybe the wrong model for for what I think crypto's most exciting promise is, right? We don't need to have

everybody in the world be totally subordinate to crypto. It's just like WhatsApp, you know, like you wouldn't say WhatsApp is a state. WhatsApp is just a useful tool, but like anybody can use it. It kind of just works and it works great even in, you know, all these countries where you have very limited bandwidth. You don't have super great infrastructure. Crypto will be the same thing for sort of legal infrastructure for financial rails, for some forms of contracts. Um, and then for some forms of trust as well. Uh if you can move some identity primitives on chain, there's a lot of room to sort of make it easier to interact with somebody that you don't know well without having the back stop of a totally trustworthy legal system like we mostly have here in the states.

>> Yeah, definitely. Uh I mean I follow this guy on YouTube. He's like nomadic capital. He has this saying where it's like go where you're treated best. Um, and I think that like obviously you can't just escape your government or escape your country that easily. But I don't know there is some there is something to be said about uh existing in places where you're treated better and things are better than in others. But obviously this is like a kind of like a first world privilege more than anything I suppose. Um, but I, you know, I just think that, yeah, I mean, I I think Rob and I are with you on the on the on the ability for this kind of online internet currency, let's call it, or money, uh, and the all the properties

that comes with it. Uh, being able to kind of give you more freedom and, uh, allow you to opt out or opt in. And so, you know, these types of things are important and I think are often understated in the speculative technologydriven kind of uh uh cycles, if you will. Uh, speaking of which, Preston, I know that you guys just announced some of the sovereign stack and we'll get into that. Um, but my question for you today is if you were to ask or if you were to build an app right now in crypto, where would you launch it or how would you build it?

What like would you launch it on Salana? Would you launch it on base Ethereum mainet? Would you launch your own chain? How like would you do a special chain? Would you do like how would you launch an application in crypto today? Where would you build? >> Well, boy, that's a tough question. U because really my whole thought is that you shouldn't care where you launch. Like your users won't care. crypto native people sort of do care today, but that's like an artifact of this this weird sort of jank of history where we have this like really hardcore group of true believers who have been in crypto for like seven to 10 years and really feel strongly that like Ethereum has the best values or Salana is the most pragmatic and will ship the fastest. But like normies don't care at all. They have no clue what base or Salana is. And

so we want to get to a world where it's like, you know, okay, I couldn't tell you if WhatsApp runs on Laravel or if it runs on Nex.js. I have no clue. I don't care if I go work there. I'll care for a while. But like that's just not something that users should care about. If users don't care, then we shouldn't care. It should just be a means to an end. So that's the the future I'm excited about. Um that's actually sort of one of the core goals of sovereign SDK to let you deploy wherever you want and just, you know, don't think about your back end. Your back end's just going to work and then build a feature that your that your users want. >> Um all that being said, I think there's there's some obvious winners in the last couple of years. Salana has been very

pragmatic and that's really paid off in terms of you know really the core problem in crypto to date has been there's not enough throughput and so apps get popular and then they drive away all their users because they you know fees go crazy or you can't land transactions and Salana has done the best job so far of navigating those dynamics. So if I was you know if I couldn't use the sovereign SDK I would probably look at Salana first. Um but depending on the app there's you know there's really valid trade-offs. There's great reasons to be on Ethereum. Um, there's great reasons to be on base. There's, you know, there's lots of good chains out there, but hopefully chains become a lot less important over time.

>> Maybe it's worthwhile unpacking the sovereign stack for us, like you know, what are some of the components to it? Uh, why did you build it in the way that you did generally? You know, what what's kind of the elevator pitch for the Sovereign Stack? >> Yeah. So, the goal of Sovereign SDK is to do two things. Number one is to give builders enough scale that they can have their app actually work. So I vividly remember like watching CryptoKitties back in the day. And it got really popular by crypto standards when it was doing like I don't know 10 20 30 transactions every second and everything just exploded, right? The whole thing didn't work at all. Uh and so then as an app developer it's like well why the heck would I ever try to use crypto? If my app gets even moderately popular,

then it's going to blow up and it's going to go down and I lose all my profits and it just doesn't work, right? So scale has been the single thing that holds back crypto the most so far. So at Sovereign, we want to fix that, right? We want to give you enough scale that like you can actually build a reasonable app. You can get users and you don't have to worry that you'll go down because some competitor of yours or some neighbor of yours got really popular or that you'll go down because you got really popular. Both of those are terrible and both of those happen all the time in crypto today, right? there's a hot NFT drop and suddenly like you can't land a transaction anywhere. All of your users are losing money and it's it's a nightmare. So number one, we wanted to solve like get you reasonable

dedicated throughput so that if your app gets popular, it can survive and it doesn't get taken down randomly. Number two, we really wanted to see users or sorry builders be able to focus much more on building the features that their users really want. And on an existing L1, that's just really hard, right? So, like think of, you know, the most basic stuff in crypto, like there's been hacks for the last 10 years like clockwork every six months to year. Um, big high-profile hacks. And a ton of that comes down to the fact that we just don't have very solid basic security infrastructure, right? Like account abstraction is in its infancy. For most of history, there has been no account abstraction, which means that basically you're trusting users with like, hey, here's this USB stick that's got a

million dollars on it. you've got to decide like do I keep this plugged into my computer and then hackers can basically get at it whenever they want or do I not keep it and then every time I want to like send 10 bucks to a friend I've got to go upstairs get it out of my safe deposit box you know whatever um so basically there's just no way to experiment as a builder uh you you have no control over the primitives and to be honest like the primitives are one of the things that matters the most and so I'd love to see a world where we ran all sorts of crazy experiments like okay maybe we do social recovery wallets maybe we um you know now we're starting to get these like uh MPC based multi-IG solutions all this fancy stuff but it's taken years and years because nobody has

control over the chain's roadmap and so like as a developer I can't just go in and be like hey going to build this cool new wallet it's going to work great or if it doesn't work then like we'll shut down the company we'll try again another year right um sovereign is really built to give you control where you can run all these experiments you're not locked into some existing chain you can control anything you want about the chain and hopefully that means that you can build much more differentiated user experiences. You can, you know, get rid of the twoclick, like we're all driven nuts by the two-click process. To do anything on chain, you've got to approve first and then trans. >> Oh my gosh, dude.

>> Nobody would live with two clicks in the web two world, but we're stuck with it because that's that's part of the chain. >> Introducing asset runes, the future of decentralized finance. Stable coins natively on Bitcoin. Hedge against volatility. Diversify your portfolio, all directly from your Bitcoin wallet. Secured by ZK technology. This is asset runes available now exclusively on Starknet. Preston, could you talk to us like a bit a bit a bit more of like some of the tech like the actual uh like like um uh you know tech choices that you guys made on execution on like transaction logic

on sequencing on just like I saw this bullet list of these things that you guys really prioritize and I just like to go through it and understand it just just a bit better. >> Sure. Yeah, I'm more than happy to. Um so what we've done is we've built a whole new stack completely from the ground up. We don't we basically don't reuse any code from any other blockchains. Um that's not strictly true. There's there's some components that like we have a whole Ethereum stack for compatibility. So you can use your Ethereum wallet, but like Ethereum's not really a first class citizen. We just provide compatibility for you. So everything's tailor made from the ground up to give you a a totally reimagined experience building a blockchain. Um, so some things that means number one you can deploy your rollup on top of

basically any base blockchain. So you can deploy on Celestia, you can deploy on Ethereum, you can deploy on Salana, you can deploy even on Bitcoin. Um, now not all of those are fully production ready today. In fact, I think only one or two of them are but but in principle you can do all of them and we have proofs of concept for many of those chains already uh and more in the works. So as a builder basically you can go where your users are or you can pick the chain that makes the best technical trade-offs for you and not be locked into a particular DA layer particular whatever. Um and then we do the same thing with our proof system. We support risk zero. We support SP1. Uh we'll have support for a couple of others coming down the pipe pretty soon here. Um so

basically we're a super super configurable you know framework for for building rollups. But then the the core piece of the rollup is maybe the thing we've invested the most in. So we sort of took a step back and we said like what do I actually want if I'm building a blockchain? And people have said for years that the thing that's important is decentralization. We think they're wrong. We think that what you want is what decentralization gets you, which is censorship resistance and verifiability. And so we went with a roll-up focused architecture because roll-ups let you have some of the best things about decentralization. You can get censorship resistance and you can get verifiability but then also some of the

best pieces of centralization where you can have you know some weekly trusted server that sits between you and the rollup and like then you don't have to download hundreds of gigabytes of random full node data to interact with the thing. Um you can get real web two like latencies. So what we have is basically a sequencer that can accept uh you know a couple thousand transactions per second today. Hopefully that'll five to 10x in the coming months or year. Um and it can respond to you within 10 milliseconds pretty much pretty much universally. Um so what that means is as a developer like everything feels incredibly snappy. You know if you're on Ethereum typical latencies are six to 10 seconds. Like that means you need a spinner on your home screen to like wait while the transaction loads and goes through and gets processed. for us. You

you know exactly what happened within 10 milliseconds. That's not just like your transaction was accepted. We can tell you exactly what happened with your trade on unis swap. What was the price? What was your slippage? All that stuff. Um you know exactly what it was within 10 milliseconds. Um but Preston is is that even that important because I think our reaction time is like 200 milliseconds or 250, right? >> Um yeah. >> Why is 10 milliseconds so important for you guys? Is is it just from a pure like latency gaming perspective of people trying to you know front run and and operate like onchain with like uh algorithmically programmed uh trading strategies basically or or kind of why why are you so fixated on this speed?

>> Yeah. So it's a really good point. Um frankly we might make it slower in the future because yeah humans don't care beyond 200 milliseconds or so like you said. Um on the other hand there's lots of other components that do add latency like the front end needs some time. So shorter shorter is usually better, but we also care a lot about being able to bring financial markets on chain. And for those, you need super low latency because of HFT. So you've got your market maker who's sort of like, hey, I'm always willing to trade with anybody at the go, you know, at whatever the going rate is. And so he'll like say like, hey, I'm willing to sell, you know, a million dollars worth of ETH at $3,000 today. And then if the price moves, like he's still happy to trade with you, but he wants to trade it at a

new price. And so he needs to cancel that order quickly. And if if you beat him to the punch, like if you know the price moved and you get your order in before he did, then he loses money. So one of my friends compares it to picking up pennies in front of a bulldozer. Like if you're slow getting your order in, then somebody takes you for $100,000, a million dollars. If you're fast, then like maybe you made a couple bucks trading with some random normie who's, you know, wanting to trade their youth or something, right? >> So market makers care a ton about being able to reliably get their order in before HFT does. Um and so for that latency is super super important.

Okay. So then let's use a practical example, right? Like bullet is using is built on sovereign stack. Um they're like effectively like a L2 on Salana, a network extension, whatever you kind of want to call it. Um how is Bullet's use case, which is effectively what you're talking about right now. How is that enabled by Sovereign stack? What do you enable for them? You know, why did they choose Sovereign to build what they're building? >> Yeah. So, there's a few core components that are super super important. Number one is latency. Um, as far as we know, we are the fastest chain. In fact, according to our internal benchmarks, uh, we're actually faster than Binance in most cases. Um, so that's a huge thing. Binance, apparently in the

exchange world, like crypto exchanges aren't thought of in the same category as sort of real exchanges. And so, market makers actually want better performance than you can get from Binance. So, we're hopeful that we can provide that. We're in the early days, so I'm sure there will be, you know, there'll be hiccups along the way, but the architecture can get us there, and we've spent a lot of work sort of getting to the point where we can compete with Binance and and all these other centralized exchanges. So, that's one huge thing, latency. A second huge thing is throughput. You know, Hyperlid does 12,000 transactions per per second, something like that. Um, and if you're on Salana, like that's three or four Salana's worth of capacity. If you're on Ethereum, that's like whatever 100 Ethereum's worth of capacity, something like that. Uh, so there was just nobody

who was even in the ballpark of that. You've got these new chains, Mega E, Monad, that may get you somewhere close to that. But, uh, but that's, you know, for a single app, that's just for like one exchange, and you want lots and lots of apps. So, we were the only team that could give them the latency and the throughput, I think, that they needed. Uh, but then we also we really take advantage of being able to give them control. So they have a super Salana native feeling experience. We let them use Salana addresses and Salana wallets to control all the actions on the rollup. So you're not, you know, if you're on Hyperlquid, you might feel like you're switching to a different ecosystem, right? If you're coming from Salana, then you got to get an Ethereum wallet, Ethereum addresses, learn all the EVM stuff to interact with Hype EVM

or whatever. Um, for for Bullet, we can give them a super Salana native feeling experience. No new wallets, none of that stuff. Um, and then uh yeah. We also like let them configure some speed bumps. So that's one of Hyperlid's killer features is being able to, you know, help market makers out by slowing down HFT just a little bit. We can do that. That would be basically impossible to do on top of Ethereum today. You just don't have that kind of control over the protocol. Um, so you know, those are the main reasons really like as far as we know, we're kind of the only stack that gets out of your way and just lets you build the thing that your users want because we're not designed to be like an existing chain first. We just, you know, okay, if somebody needs configuration on

this thing, we add a configuration option. Um, you get full control over your stack and you can decide whatever you want. >> Yeah. And that there's power in that flexibility because then you're you're kind of embracing your community's creativity and opening up the world to them. And so I'm curious like you guys are intimately familiar with your own technology, right? uh you don't have all the time and the bandwidth in order to go build out all these cool apps that are enabled by your technology. If you were to kind of put a call to action out there, what do you think are some applications uh maybe they're in the machine economy, botto, you know, in uh they're maybe they're non-financial use cases. What do you think are some some apps that are uniquely enabled by

Sovereign Stack that, you know, app developers, if they're looking for some inspiration, you know, the these are some good ideas for the Sovereign Stack. Yeah. Um, so I mean the the big one, the obvious one is exchanges. We think we're the the first stack that really can let you build a competitive exchange experience but onchain. Um, so that's a no-brainer. Um, we're also pretty excited about a lot of like the stable coin use cases. Um, you know, right now if if you want to provide a payment provider again like you're going to be super bottlenecked by throughput. If you get popular, you're in huge trouble.

sovereign gives you enough throughput and good enough latency that like you know your customers won't be waiting at the ATM while their payment is processed. There's no noticeable lags and all that stuff. So payments are another big one. Um and then I'm excited about like there's a whole category of kind of developer tooling more boring stuff that that would benefit from having an immutable record of when it happened. Think even of like tweets, right? We've all seen the like this tweet has been deleted screenshot of of tweets. And in that case, it's really hard to know like is this a real tweet that the guy actually deleted or is this a fake tweet somebody generated with chat GPT, right? It'd be really great if like if putting stuff on chain was cheap enough, like just put all your tweets on

chain and then you can prove like, hey, actually I never tweeted that. Here you go. Here's the log of that block. It's not in there or here you go. It is in that block. It's, you know, whatever. Um, so you know, thinking of blockchains just as like a whatever we want a record of of actually happening. Put it on the chain. It's cheap now. It's almost free now. Um, and so really get creative with it. Yeah. >> Preston, if you were if you were to build one app, what would you build? Like what is a what would be a passion project of of yours? >> That's a good one. Um, I'm really excited about a lot of the privacy stuff that's coming down the pipe.

>> Um, okay. So, so yeah, I would probably work on some privacy oriented stuff. Um, maybe financial, but also maybe non-financial, like some of the the more identification stuff. >> Um, it's kind of a hot topic right now with like all of the, you know, the UK has their new online privacy or online like security law that's, you know, targeted at whatever protecting kids. Um, having some age verification that is not every website I ever visit. seeing, you know, my full name >> sounds really great right now. Like, you know uh >> you can easily generate a CK proof that like, hey, I really do have a government ID that shows I'm over 18 or over 21 or whatever. Um, >> and then you can use that credential

rather than rather than actually um having to KYC at every website because we've seen how that ends, right? I'm sure you guys all saw the tea app fiasco a couple weeks ago where like all of the driver's license they collected got leaked online and now >> your real name with like the random mean tweet you sent about some guy >> Rob. Did you see that? >> It feels like that h that kind of thing happens every two weeks. Every two weeks that specific tea one >> the tea app the tea >> Yeah. Yeah. You've seen that right? >> I think so. What What was special about that one? It was just like this like uh reputation system for dating, for women, for rating guys basically. And then they just leaked all these guys information and it's created by a gay guy as well.

>> It's super funny story, dude. It's super funny. Um person, so you mentioned trading uh for for exchanges. Um Hyperlquid is is a cool example of this kind of like CLB example, right? Centralized limit order book. These have been popular on the NASDAQ, on the right. I'm curious from your perspective, is there one uh precise way that you think is the best uh in terms of assessing the trade-off spectrum for building a club? Like is there a best practice right now today with the given tools we have to build a club in order to like achieve maximum uh viability on the spectrum of like speed, security,

decentralization effectively or whatever the kind of trilmma is. Introducing Summerfi, one of DeFi's oldest and most battle tested platforms. Summerfi automates your exposure to DeFi's highest quality yield so you can sit back and enjoy this summer. Deposit stable coins at USDC or USDT and let Summerfi route your funds into optimized low-risk lending strategies. With over a 100 million in instant liquidity and support for over 34 protocols across Ethereum, Arbitum, and more, you always stay in control. Choose from a wide range of curated strategies reviewed by independent risk experts, all in just a few clicks. So why work hard for your yield when you can be lazy? Start

earning now at summer. the home of the lazy summer protocol. >> Yeah, I mean I think if you want to build a club, there's a couple of like absolutely musthaves. There's no point in building a club basically if you're going to be slower than a couple hundred milliseconds. Like market makers just can't make money and so you will never get price discovery on there. And that's what we've seen over and over again with all these all these exchanges. So I think like basically don't waste your time building something that's going to be too slow or that's not going to have enough throughput to provide whatever you think your target market is. And not everybody needs thousands of TPS. You know, maybe you're trading like longtail, you know, NFTTS or or altcoins or whatever and you only need a few, you know, tens or hundreds of transactions

per second. But you got to look at what's the maximum latency we can accept. What's the minimum throughput we can accept. Beyond that, you obviously want more battle tested. And to be honest, like this is where Sovereign SDK, you know, is going to come out worse in the rankings. We're brand new. We've got our first people going to production in a couple of weeks here. And so, like, you know, I want to be honest. We think we've done everything we can to to make it solid. We've got audits, all those sorts of things. But like, okay, as a builder, you've got to be really pragmatic about the risks you're taking as well. So, um, so, you know, I would look seriously at sovereign SDK for sure because we give you throughput, we give you the latency you need. But if you don't think you need those things, if you think you can

get away with Salana or Aptos or one of these high throughput chains, you know, um, definitely think about it. What I would say though is that sovereign SDK should be way cheaper, way faster, way more secure than building your own thing. um unless you are like an incredibly well-funded deeply technical team. Like maybe maybe if you've got three years and an army of PhDs um it's worth building your own chain but in the vast majority of cases we can give you 90% of what you could get from that but in a much more battle tested you know a stack that already exists and is a little more tested and proven. So, okay.

So, then with that thought then, >> yeah, just one last followup, Rob. Uh, do you think Salana's value prop is being like cannibalized by something like Hyperlid or just these very or like a mega ETH that can just like that is much more optimized for CLBs in the current state. Like if Salon can only do like 2 or 3K TPS right now, obviously it's climbing. It looks strong like it's, you know, up into the right, but you know, you need a certain amount of throughput for uh these these exchanges to actually work. like like how do you see the how do you see like Salana and like the hyperlquid kind of like battle play out like you know maybe bullet you know helps Salana's value prop here kind of in the same way that L2s help Ethereum like how do you see Salana's

role in this uh kind of like uh high throughput club like 10 20 50k TPS world that it seems like we're rapidly getting to >> yeah I mean to start off like Salana is an incredibly impressive chain and it's a great founder Anatolian Raj. So like never fade Salana. I don't think I would count Salana out probably ever. Um that being said, they have a much much harder task ahead of them if they want to compete in this world than Hyperlid does where Hyperlid got a chance to design from scratch knowing exactly what they wanted to go after and learning from all the mistakes that Ethereum and Salana and all the others made along the way.

Whereas Salana has been deployed for years, they've got all of these other applications that they really can't break, right? you can't break Jupiter. You don't want to break all, you know, pump.f fun, all these other things that are going on on chain. And so, you can't make as aggressive, you know, decisions around hard forking all those things as Hyperlquid can. Hyperl is fairly centralized. It sounds like they control a quorum of validators that they can upgrade whenever they want and that isn't enough on its own to hard fork the chain and so if they want to ship a feature, they can do so very very aggressively. Salana doesn't have that advantage. Um, what Salana does have is is really good developer mind share. Um, and then like an incredible killer team of engineers working on the protocol.

Um, so, you know, I I wouldn't count Salana out by any means, but I think Salana in a straight head-to-head versus Hyperlid for exchange use cases is going to have a hard time. You know, if they manage to pull that off, that'll be like an incredible win. Uh, and it's testament to how strong they are. But Hyperlid definitely has it easier. >> Yeah. I mean, okay. So then yeah Robin I know that you you have a question but I guess like the the the decision becomes like it is building the endgame club like the most valuable thing to do on blockchain infrastructure today like is that what's going to generate the the most fees the most revenue you know the most uh the best tool and product to rival that of a centralized exchange or

like NASDAQ a and like if that's the if that's if the answer is yes that then it seem like a lot of these kind of high throughput L1s would want to be restructuring their kind of agenda towards and kind of roadmap towards achieving that outcome. Um but but yeah, I don't Yeah. Yeah. >> I'll just I'll just kind of build on that because my my question was somewhat similar like why do we need more than one club? What is there such a thing as an endgame club where all the liquidity coaleses? you know, if clubs are the killer, exchanges are the killer use case of sovereign, like why is it important that we have some diverse ecosystem of exchanges rather than just one killer?

Yeah, I mean I think there's a handful of reasons you might want that. So, one thing you could do is like look at traditional financial markets. Um, and we've got like NASDAQ, we've got NYC, and then we've also got like, you know, other products. There's the, you know, futures exchange in Chicago. Um, and then like, you know, Forex happens in a different spot. There's you've got markets in London. you've got markets in Singapore or in, you know, Hong Kong, whatever. Um, so we see that like different geographies want different kinds of markets, different regulatory environments, different kinds of products need different kinds of things. And it's very, very hard for one team to specialize in all of those things at once. And so we just in practice have never seen one team totally run away with all financial exchange. Um, in particular in crypto, you know, we

talk to teams all the time who are building exchanges and there's a million different kinds of things. So there's pers, there's spot exchanges. Um, but then there's like much more niche like, okay, I only want to exchange stable coins with other stable coins. That probably has some architectural differences that you want to do. Then there's like, you know, real real world assets. There's uh sort of like the all the NFTs, all the not strictly financial assets, but that you may still want to provide liquidity for. So there's this massive range of different designs to be explored and you know maybe we'll get some big winners down the road in a lot of these categories but right now like most of them are wide open. There's not even a single big player in most categories that people care about I

think. Got it. Makes total sense. I mean there's there's going to be different winners for different categories, different regional markets, different asset classes. And then we're going to connect all of these with the various infrastructure plumbing bridges tunnels, technologies, uh, to bridge all this liquidity together and get get really good price discovery. Probably hopefully better than traditional financial price discovery. >> Preston, thanks so much for uh, for >> I'm I'm not done yet. I don't know if Preston if you have some more time. I just have some more like some more thoughts here.

>> Yeah, sure. Fire away. >> Okay. So, so um when you've been when you've been building out uh the stack, what is it that the builders have valued the most uh about sovereign stack or like what are their like what are their main needs? Let's use bullet with Tristan as an example. And I'm like, what is something that you built out, you know, on the contrary that you thought that these that these teams would really really need and want, but you're you're not yet seeing the demand for that specific service or or part of of of the stack quite yet. That's a bit that's kind of like throwing you off guard a bit.

>> Yeah, sure. Um, so I think the the big thing that people have really said they like about the stack so far is actually how easy it is to build. If you want to build an exchange on Salana, you've got to deal with all these contract size limits, all these transaction size limits that are very, very painful to work around. And so, you can't just naturally express your business logic. Um, with sovereign SDK, we hope to be like an order of magnitude better on that. We can get rid of all the size limits and just make it much more natural. It feels a lot more like you're writing like um I don't know, just regular old code but verifiable. Um, so that's a big one that people have liked a lot so far. Obviously latency is another huge one that honestly wasn't a focus of ours in the very early days. We

were we were building base rollups way back in the day that had sort of six second block times and uh that was like there was incredibly strong customer demand for lower latency. So we really pushed on that. Um on the other side you know some stuff that that we've built there's been a lot of things that we've built over the years that uh hasn't made it to market or or isn't fully yet ready yet. Um, so one big one we thought we would need more block exploring infrastructure. It turns out a lot of people don't want that much from their block explorer. Like they they're building an app chain and so their front end is kind of in place at the block explorer and they may have like some sort of primitive thing but typically there's not a lot of demand for like ether scan style block explorers. Um,

another big one is uh sort of fully proofbased bridging. We thought that was going to be a huge a huge value ad for customers and for the most part they aren't too concerned about you know operating a a more trusted hyperlane style bridge for now. Uh so we'll see if that changes that that could uh pick up you know pretty soon here but but yeah so far there hasn't really been a lot of demand for that >> and of innovation just real quick like when it comes to multi-chain and app chains like you know you guys are pushing boundaries yeah maybe it's a little bit more trusted of a bridge setup but you have 10 millisecond lat like there are things that you guys are pushing the boundaries of and you know maybe there's there's compromises but ultimately

there's there's a particular particular design space that you guys have have embraced and and there's a lot of opportunity there because we haven't seen projects and and infrastructure quite at this at this limit. >> Yeah, that's what we hope. We hope it's >> um Preston, what is the business model of Sovereign? How are you guys going to be able to make money and to uh you know fit in this revenue meta, bro? Because if you're not making revenue, you're not going to make it. You know, that's what they're saying these days. I don't know if I buy it, but what's the what's the sustainability path for for you guys here?

>> Yeah, we we completely agree with that. Actually, we think if you don't have revenue, you're not going to make it. The 2017 meta of like tokens with no revenue, having a huge premium is long gone and should be. Um, so, you know, we haven't thought about launching a token because we don't have a coherent story around how it would actually acrue long-term cash flows from our business. Uh but if we get to the point where we think that makes sense, we we might consider it, right? Um so the the business model is just a revenue share. Uh if you use we've got some some components that are uh that are not proprietary, but we have some components like the very low latency sequencer. If you want to use those components and you use them to build a killer app, then we take a revenue share off of that app. Um

it's totally permissionless. You can deploy without talking to us. Uh, and then there's just a fee switch built in that we can toggle um if you you know, so you sort of agree with that in the license, but you're you're free to deploy and we won't take anything on day one. >> Got it. Just had a uh a a five jet uh fly. >> Almost like I was at at at the Super Bowl here. It's pretty insane. Um, Preston, do you uh do you imagine that the revenue that you'll be able to get from teams like Bullet and others uh to be uh significant enough to like, you know, even out costs eventually be profitable, then turn then kind of turn that into uh

thoughts around token or like how are you guys thinking about like the early stage that you're at now into like profitability and then into like uh community ownership like like what does that look like in your mind for Sovereign? >> Yeah. So yeah, if if Bullet were to do well, that would absolutely be enough to make us profitable. Um, you know, that's one great thing about our model is we're very incentive aligned with our customers. Like we really want to make sure you're successful, which is not the case for necessarily all of the other rollup frameworks that charge kind of a flat fee or whatever. Um, so so yeah, that's absolutely would be enough to make us profitable. Um, and to be honest, we haven't thought too much about like since we don't have a token, how we would how we would incorporate one or anything like that. Um,

you know, there are interesting questions about like, okay, if if this becomes successful and there's uh broader interest in the software, how do we sort of transition ownership more into the community and out of the hands of the of the company um to make sure that sticks around well beyond our, you know, our company lifetime. Um, but for now, you know, we're kind of in the early days and enjoying that fact. We we get to run as a regular business and just try to focus on helping customers make a great product. Um, yeah. So, >> yes. So, we'll see, I guess. >> Yes, brother. Thank you for your time, Preston. I appreciate you, man. Rob, you got anything else?

>> We're good. I mean, that was that was great stuff. I I I uh I'm very excited to see the ecosystem flourish on on Sovereign. Best of luck, guys. >> And congrats on the announcement. I I I know it's been a lot of time shipping with with not with no hype, so it's uh it's bullish. >> Thanks a ton. Yeah, it's been a grind. Uh but yeah, I really appreciate you guys having me on. Hope to be back sometime soon. Yeah, nice to meet you, man. We'll we'll we'll catch up in a couple months, see where you guys are at. >> Sounds great. >> All right, buddy.