SEC vs Coinbase update, Polygon 2.0 architecture - The Daily Gwei Refuel #614 - Ethereum Updates

Transcript

hello everyone welcome to another episode of The Daily gray refuel where I recap the latest news in the ethereum ecosystem I'm your host in the designer it has the 30th of June 2023 alright everyone let's get into it so before we jump into the news uh for today I did want to give just a quick kind of shout out here or a code and quick PSA here for people to prevent themselves from getting scammed now I'm sure a lot of you see discords uh for different projects getting hacked from time to time and uh these various fishing links being uh kind of shared in these discords as if they were coming from the moderators or the project team itself and usually what happens is that this is a fishing link and you go there and you interact with it and then your wallet gets drained so I just wanted to give a

PSA that you should never click anything that is shared just out of the blue by the project teams like this especially things that ask you to connect your wallet and sign transactions and interact with it in any way with your wallet you should definitely double triple quadruple check things even if it seems legit sorry if they do like an announcement in the Discord channel that that there's like some airdrop and you can go claim it at such and such a URL I would cross reference that with other social media channels that the project has I would cross reference it with the actual team members themselves like multiple team members and I would also make sure that the URL you are on is the original one of the project now of course there's no way to to completely protect yourself because if that's a

very sophisticated attack and for some reason the hackers were able to get access to the legitimate website as well as many different accounts that are of the the project team then yeah I mean it's going to be kind of like very hard to to kind of verify the the legitness of a link but generally that those are the I guess like quick tips I can give to avoid things like that but on top of that there are also other things out there that can protect you from this I have talked about the safe wallet app uh firewall feature that I highlighted the other day there's the fire extension uh as well uh there is a few other things out there as well that will help you uh um you know um not just for Mev protection but they do other sorts of protection as well so

yeah just generally don't let the fomo kind of take hold when you see this and make sure that you don't click uh links that look at all suspicious especially ones that are asking you to interact with them with your wallet or download anything onto a computer just general kind of security tips there for you so I just figured I'd give a shout out there because it's quite common that a Discord channel would be hacked and all it really takes is for one of the moderators to be hacked right um and one of the moderators to for some reason maybe not have two-factor authentication and then they get hacked or some other some other such way and then the hacker can obviously have mod privileges on the Discord Channel and start sharing stuff and sharing fake links and things like that and I guess I I don't expect myself to to get hacked

or my my um my Discord to get hacked but if you ever see any kind of like airdrop or anything in the daily gray Discord uh Channel get linked by me you know 100 of these fake because I've said before there's never going to be a daily wear token I'm never going to do an airdrop of anything so if you see that I definitely do not click any links there but anyway moving on to the news from uh the last 24 hours so a few uh coinbase updates here So Meta lore man well I guess coinbase versus SEC update so met a Lawman put out a tweet today uh basically starting off by saying the lawyers for coinbase have come out with an interesting opening move in the case and then he says this is going to get complicated so you can read the full

tweet here from meta Lawman that explains this but basically uh coinbase uh filed that um that response the other day that I went through I think I talked about it yesterday or the day before the response where they basically responded to every a single one of the sec's claims against uh against um uh against coinbase I should say sorry uh and coinbase obviously included a very lengthy response there as meta Lawman says yeah which is kind of unusual for these things usually the response is like admit to something or deny something but uh what comes has done has gone above and beyond and I think what they're doing and and and met a Lawman outlines it here coinbase appears to be using this this creative strategy to get documents helpful to its

cause in front of the judge through the answer so through the answers they basically uh expand more than just saying admit or deny and add extra context for the judge to look at to see and and strengthen coinbase's case but you can read meta Lawman's tweet to get the full context here I just wanted to highlight it for you guys uh Jake chavinsky also has a really great tweet thread here all about uh Gary Gensler and how he is not in an impartial uh person uh in in most of these SEC cases or pretty much all of them uh against crypto and he should recuse himself from these cases especially the coinbase and binance ones uh and Jake actually provides a very convincing argument as to why this is the case in his thread so you should go check that out for

yourself but it's not just the thread it's also a post from the blockchain association here that was put out and can be actually used by lawyers that are either um you know defending uh different companies from the s Cc or actually going after the SEC for various different reasons and you can check that out for yourself as well link it in the YouTube description below and just last up here is a tweet from AJ Warner who said and for those of you who don't know who AJ is he um works at off-chan Labs uh the development team behind arbitrim but he put out a tweet saying the amount of resources that coinbase is putting into their legal defense to make sure this is done right and no stone remains unturned is incredible I understand that in many ways this case could be existential and Clarity from both a

legal and policy perspective is necessary for them to continue continue to succeed but it's also important to recognize and appreciate that they're in many ways bearing the burden and costs full of us right now thank you coinbase so I think this is a really good point here and really true and I've said it before coinbase is really putting the hard yards in to defend not only themselves but the crypto ecosystem at large now of course as AJ alluded to here cleanbase is doing this in part because it is a big issue for them if the SEC wins this case against them it could put potentially destroy their business right I would have I would have a lot of effects on their business but it could potentially destroy it completely and just make it impossible for coinbase to operate profitably in the US and they'd have to go offshore uh

or completely offshore and they wouldn't be able to service us customers anymore that's kind of like the worst case there but at the same time you know coinbase is also fighting for all of crypto and sticking their neck out for all of crypto and get trying to get regulatory Clarity from the SEC and other agencies and especially Congress for crypto itself and if they succeed then all of crypto will be better off for it so it's really great that um that we have such a I guess values aligned company or crypto values Alliance company such as coinbase fighting for us Finance is also fighting and I actually do believe that CZ does share a lot of crypto values um that a lot of us do even though I've said before that I think CZ is a bit of a shady actor um or traditionally has been

and definitely a profit Maxi that I I I believe that that is uh true as well but I do think that he shares a lot of those values and obviously he wants to protect his business too and he he wants to make sure that binance can continue to operate and and Thrive so having these two juggernauts fighting for us and spending all the money to fight for us fight for crypto at um such a large scale I think is really really important and something that should be acknowledged and if you know anyone that works at coinbase or especially working directly to defend uh you know the crypto ecosystem against the SEC you should definitely give them props on that and make sure that they are valued uh for that there but as I said I'll link all this stuff in the YouTube description below and you can go check

it out for yourself So speaking of positive regulatory developments uh in the UK we've had a landmark finance bill uh go through that will recognize crypto as a regulated Financial activity in the UK uh which was passed into law giving it the final approval because it was signed by King Charles it's always weird reading King Charles there instead of Queen Elizabeth I I kind of got taken aback by that I'm just like what but anyway that was just that's just like a formality of what they do in the UK and and funny enough fun fact in Australia because we're not a republic the queen or I guess the king um could if he wanted to reclaim Australia for himself in the worst case scenario uh it would never happen in practice but it's kind of funny that

Australia is actually um technically still under I guess like a monarchy uh um kind of system there uh but for all intents and purposes it isn't but anyway that's a little beside there uh but this is this is really positive out of the UK the UK has actually been sending a lot of signals recently um positive signals with regards to crypto you had the the PM the prime minister of the UK I think his name is she he's been saying a lot of positive things about crypto and wants the UK to become a crypto Hub um I think that they're doing this for a number of different reasons one they're obviously taking advantage of the fact that the US is pretty hostile towards crypto and attracting new entrepreneurs to the UK to build crypto related products to the UK really does is already a financial Hub so there is a

lot of um the existing infrastructure there three everyone knows UK left the EU uh you know a few years back now I come with the exact timing it was but they left so obviously they they need to continue to innovate and make sure that they're continuing to be competitive on the world stage in terms of economic output things like that so yeah a bunch of different reasons why I think the UK wants to be the crypto Hub here and for them to to already have passed something into law is a big deal because you know we want the us to do this is exactly what we want to ask us do we want them to legislate we want them to pass things into law they give Clarity for crypto but the UK is ahead here and you can read full details about this in the

coindesk article which I'll link in the YouTube description and below all right an interesting announcement from Shopify today so Shopify CEO Toby here uh shared a um a post or to a Dev portal saying the blockchain team at Shopify did a fantastic job creating a new tutorial for how to build a token gated Shopify storefront from scratch using Shopify functions remix hydrogen and wallet connect uh you can now do this so yeah this is a basically a developer facing tutorial on how to do token gated shop fronts using uh Shopify here and it basically for those of you who don't know Shopify is an e-commerce platform that makes it an easy for anyone to set up their own eCommerce store it's got a nice graphical user

interface and everything like that and they have this concept of I guess like plugins as well where people can kind of download these plugins and it'll enhance your website or enhance your Shopify store and things like that well with this new tutorial uh developers can create things that or or integrate things into their plugins that will allow for token gated Shopify storefront so essentially what this would what this would mean is that you would have like a token or an nft that is in your wallet and then you would visit a Shopify storefront you'd connect your wallet and verify that you actually hold that nft or token and then it will allow you to access the website itself or access certain areas of the website or purchase certain products or get discounts on on certain products because you have that

nftl token so that's actually really cool and I think this is just a really nice marriage of like the web 2 world and the web 3 world and Shopify has actually been innovating you know within kind of blockchain and crypto for quite a while now and they're not one of those web 2 companies has kind of shunned it they've actually embraced it so great to see that from Shopify here and if you're a developer you can check this out for yourself I'll link it in the YouTube description below all right so the Devcon Twitter account shared today that the road to Defcon 7 in South East Asia begins so if you are located in Southeast Asia driven by driven by a community focused spirit and passionate about organizing educational ethereum meetups uh you can read on and find more uh about the road to Devcon

grants round which will go towards supporting that so I'll link this in the YouTube description below for you to check out if that applies to you but I don't think that there is a location that's been announced yet uh so southeast Asia obviously is the general location but like the specific specific location I don't think has been announced yet I'm not sure where this is going to happen I've heard Rumblings of things like uh Vietnam and Singapore I've said before that I don't think it would happen in Singapore simply because um Singapore is too expensive for uh and and generally devcons tried to be hosted in places where it's very accessible to people from all around the world Singapore probably doesn't fit that bill um but uh Vietnam definitely would maybe Kuala Lumpur in Malaysia would fit that as well I think those two would be my

like front run uh that they're they're kind of like the the front of the pack for me in terms of the where they would go out of those two I would maybe say Vietnam has more of a chance but then I think about the fact that there already is uh Vietnam ethereum events um I don't as far as I know there isn't a major ethereum event that's ever taken place in Kuala Lumpur I'm I might be wrong here but as far as I know uh there isn't so maybe that'll happen as well and I think that that fits the the bill of like in somewhere that the um that uh that if your events haven't been before in an affordable place for people or generally affordable place for people much more affordable than Singapore obviously and still in South East Asia um but yeah I mean that's the thing like

it could be anywhere but the thing is you have to think about like what a Devcon requires it requires uh access to good public transport uh it requires an in-transport generally requires access easy access to people flying in and out right requires a good airport it requires a a big enough venue to host it right and a big enough modernized menu to host it because obviously there's going to be a lot of people going to Devcon I'm definitely going to go I mean the fact that it's in Southeast Asia is just a bonus for me but I was already planning on going to going to Devcon here uh so yeah I think yeah Vietnam will Kuala Lumpur probably the Front Runners but we'll see we'll see which one it is maybe I'm completely wrong and it's somewhere that I haven't considered yet but maybe you guys know more than me

here uh so I'd love to get your thoughts in either the YouTube comments or the Discord Channel and actually on that note um I was talking about scammers at the beginning of the refuel in the YouTube comments there are so many scammers all the time guys like so many shills and just stupid comments and I remove them as much as I can but on yesterday's video they basically spam the video with like 70 different comments and I was like nah I'm not going through this manually to remove them all I can't be bothered so just know to ignore that completely I think you you guys know that already but just don't click any links there or anything there as well um and don't go to any of the things that they tell you to message some of them will say or message this person on

telegram to get trading tips don't do that you're going to lose all your money right uh so yeah just just a heads up on that one there all right so uh let's uh here from the uh 21 shares uh uh company here has uh an exciting announcement for us today so they've built a new tool at blockdamon.com chappella which basically allows you to calculate how long it will take to withdraw a certain amount of eth so you can see the calculator in front of me here if you were to input 32 eth and then submit it will tell you um uh basically it will calculate basically the total withdrawal request is a combination of partial and full withdrawals uh partial withdrawals and

full withdrawals so everything that's currently um requested and then it will tell you the timer for partial withdrawals and and full withdrawals here so this is really cool I think that a lot of focus has been put in put on deposits deposit timing you know deposit queue stuff like that and not enough has been put on withdrawals so yeah this this new resource from from uh 21 shares in block game and a bunch of other people worked on this as well is is very cool and and very important and you can actually go play around with this for yourself I'll link it in the YouTube description below um as far as kind of like entering validators and exiting validators it's kind of funny the activation queue is 92 000 pending validators it's 45 days long the exit queue has five validators in it

and it's three minutes long so it's just always funny to see like how literally no one wants to exit and obviously this is due to a bunch of different reasons I think that a major reason is definitely the fact that if people want to exit they can just they can just sell their um LST whether it be stf or R8 or whatever else for eighth on the open market but I think what people don't understand is that if enough lsts want to sell right well okay let me step back a bit I think what people don't understand is that when people are selling lsts they're usually selling it for eth right so there is always a buyer there for that but if there is a lot of an LST being sold like we saw last year when 3ac was offloading their stf into the into the available liquidity on

chain it would I guess like it's not a peg but it would make the Ste trade at a discount to fair value and it did it went it went pretty low I can't remember exactly how low it went I don't think it went as low as 0.9 but it got pretty close to that um so you you essentially could buy um 0.9 uh sorry one s 68 for like 0.98 as an example and then you could wait back then until the I guess like fair value until we got back to fair value um and then you could make an Arbitrage you could make a profit there now with withdrawals enabled you don't have to wait you can request a withdrawal through Lido or or through another LSD provider whatever it is and essentially ARB against the beacon chain so you don't have to up against the secondary

market so what would happen is that if a big whale wants to exit and they don't care about slippage and they don't care about um losing money because of that then and then if the discount went to like 0.98 or something like that you could basically buy the sdeath and then just arbit on the beacon chain so it would very quickly go back to fair value anyway because a lot of people will be buying it but then you could also just um arbit with the beacon chain itself and you would have like a a low risk kind of ARB there very low risk basically I mean I wouldn't say risk-free but like extremely low low risk on on that front so unless that happens I don't expect the execute to really get very big and I'm gonna be it's gonna be very curious to see what

the execute looks like in a bull market and what uh you know what the total e-stake look like looks like in a bull market let's say we're like 12 months into the bull market or like at the tail end and prices are going nuts uh is the execute huge because everyone's trying to get out to sell their eth or have they already done it on the run up there or have they just sold their lsts for eth and then the Alice teaser at a discount and the execute is huge because of that it's going to be very interesting to see how that all plays out um but this calculator will actually be uh very cool to keep an eye on uh when that potentially happens uh so yeah great uh to see that this was built out and you can check this out for yourself

I'll link it in the YouTube description below all right so octant uh which is a new project built by the gollum Foundation has announced today that they're kicking off Epoch or epic zero uh of their new initiative to donate one million dollars worth of eth to some of their favorite public goods projects and uh the community gets to decide how these funds are going to be distributed now for those of you who don't know Gollum is using um I don't know if it's all of their treasury but a large part of their massive eath treasure treasury I think a hundred thousand each um and they're staking it and then they're using the staking rewards to fund I don't know if all if it's all the staking rewards but a healthy chunk of

it to fund or give back to public goods within the ethereum ecosystem now I think this is a great outcome because for those of you who don't know Gollum was one of the first icos and because of that the eighth price was really low so they raised a lot of ease before eath went nuts because it was based on like the dollar value right and there were a few projects that did this and because of that they've been sitting on this massive treasury for age ages they were waiting for withdrawals to be enabled and now they're staking all of that eth I think as part of their own staking operation I don't think they're using a um an existing third party I think they spun up their own here and the rewards obviously they're going to be using some of it to fund the development of Golem

and other such things but I think they want to use a lot of it to fund public goods within ethereum um so that's what they're doing here this is a start one million dollars worth of eth as part of Epic zero here uh and in this special round of funding you can choose from a curated list of 10 different projects which are listed here and this is a pre-launch event so the distribution of uh octon's epic zero reward pool will take place outside of the octin App instead again it's snapshot poll will be conducted to determine how the one million dollars worth of eth will be divided among potential potential beneficiaries so you can go check this out for yourself I'll link it in the YouTube description below but great to see that uh I guess like an OJ ethereum project that raised a lot of

eth is doing good by the community writers giving back to the community uh and and using that massive eth treasury uh for good rather than just cashing it out and riding into the sunset like a lot of projects from the Ico Mania did unfortunately all right so we have more details around a polygon 2.0 architecture that was shared today so you can see here that polygon 2.0 has been designed to provide unlimited scalability and unified liquidity thus transforming polygon into the value layer of the internet so you can read the blog post TR or keep scrolling to see what this architecture looks like so it's basically split into four different categories you have the staking layer the interoperability layout the execution layer and the proving layer and this is all broken

down in of course the blog post and also the Tweet thread but you can check out the image here for a quick breakdown so you've got the proving layer at the top which is basically everything got to do with zero knowledge stuff and ZK VMS uh improving out the proofs for for those sorts of things then you have uh the execution layer which handles a bunch of different things like peer-to-peer and syncing interoperability layout which handles the passing of messages between the different ZK VMS and the staking layout which is obviously the the stakers that handle the um uh the so the value that is that handle the things like that availability management and stuff like that and obviously all of this kind of settles down to ethereum as the the kind of L1 there as the the ultimate settlement layer uh at the um

at the end there so there is much more detail in the blog post in the Twitter thread so I'm not going to try and read through it all uh but yeah I mean I'm I'm super excited about polygon 2.0 uh you know you guys know I'm an advisor to polygon and I'm not just saying this because I'm an advisor of course but I think that the l2s are converging towards this architecture of we're gonna build out this thing right we're going to build out this Tech stack and then we're going to get people to build with that whether they want to build their own you know app chain or whether they want to build on a generalized chain whatever they want to do with it they're going to have the tools to do that and then also making sure that it can be uh plug have Plug and Play interoperability

everything can talk to each other there's a choice of where to store your data so you get Choice over like how expensive it is how expensive your your deployment is and everything like that so giving them the a choice while also allowing the teams to just use ethereum as that sediment layer so that they don't have to pay out exorbitant costs for settlement and and basically devalue their potential tokens I think is really really important uh so it's great to see this being built out and detailed here I'll link information about it in the YouTube description below uh and Sandeep one of the founders of polygon also has a tweet threat about this where he explains or a couple of tweets about this where he explains a bit more about it so you can check that out and I'll link it in the YouTube description below

for you to do so all right so an update out of the base ecosystem so they said here security is an essential part of bringing the next million developers and billion users on chain uh we're sharing however approached security how we're preparing for a secure mainnet launch with internal and external security Audits and how we draw on coinbase's best practices now there is a tweet thread and a blog post uh to to dive into which I'll link in the YouTube description below but there is also another tweet so they quote tweeted their own tweet they being base and they said in case you're keeping track with the completion of these audits we've now fulfilled four out of five of our criteria for mainnet launch and there was a tweet that came from

um that came from Jessie one of the the leads of or I guess the lead of the base efforts where he basically said that you could that we can expect bass to come out potentially this year right to hit mainnet potentially this year which is huge guys like I I can't begin to describe how big I think it's going to be that bass goes live with all the existing l2s that are already live all the ones that are evolving um like polygon 2.0 2.0 things like the op stack being built out which I'm doing their l3s and obviously arbitrim uh one continuing to grow and then EIP p4844 hitting mainnet and costs coming down so much and then going into another bull market next year which is my personal opinion there's no guarantee of it

happening but I think we're going to get another bull market next year or at least the beginnings of the bull market leading into 2025 I just can't begin to tell you how exciting and bullish it's going to be for l2s generally they're going to be cheap they're going to be easy to use they're going to be integrated with all of the existing infrastructure like metamask and other worlds and stuff like that there's going to be lots to do on there demand's going to come back uh the fees are going to remain cheap on them especially on things like validium so I'm not talking about just roll-offs but validiums as well and there's going to be a world uh for for new world of things for people to do and and on top of all that uh bass is going to bring on a ton of users

who have never used any on-chain products before because coinbase in my opinion is not going to list a lot of assets from now on if any really so if they want to keep that market share and keep that um that kind of like business on coinbase what they're going to do is they're going to basically have an asset listing page or an asset information page on coinbase.com it'll say this is such and such asset and give some information about it and then it'll say it's not available on coinbase.com but you can trade it on base and then it's going to have a breakdown of how people can Bridge their eth to base and then trade that eth for tokens on base and the tokens on base will be all the ones that aren't on on coinbase and that's going to bring a crap ton of users on

chain just like what binance did with BSC um uh coinbase is going to do with bass and I'm honestly stupidly bullish for that I I really do think people are underestimating how bullish that is for uh just ethereum generally and getting people on chain because I've said it before and I'll say it again now I don't think people just buying crypto assets on exchanges can be considered a crypto user they're not using crypto all they're doing is speculate adding on the asset right like you buying Apple stock is not you using an iPhone okay and maybe you use an iPhone at the same time as buying Apple stock but if all you do in the Apple ecosystem is Buy Apple stock you're not using an Apple product you're not using an iPhone so it's not it's not the same thing whereas with you know ethereum for example if you buy eth

and just have it on Exchange and and and you're not staking it you're not using Heath right you're not using ethereum but if you buy Ethan you bridge it onto ethereum and you start doing uni swap start the trades or putting it into money markets or buying nfts and stuff like that well yeah of course you're an on-chain ethereum user you are using ethereum so I'm pretty like adamant about that I I don't think that because a lot of people say oh you know we have like 100 million users in crypto no we don't we don't because they're not using crypto they're just buying the assets and most of the time they're only buying it because it's been going up and it's been in a bull market so no that's not users users people who actually use the products and services that are built on

chain uh whether they use it through a centralized intermediary or use it on their own through their own wallets doesn't matter but as long as they're using the products then they're users if they're just buying assets on an exchange that's not being a user in in my opinion but I guess like just to give a bit of a counter argument to that people will say well these assets do act as store values and do act as um as kind of like Hedges against inflation like okay yes but at the same time if you buy eth or BTC and you only keep it on a centralized exchange to custody yet then how can it be a I guess like asset that you're using as a hedge because you're still part of the centralized Financial system by storing it on a centralized exchange for you to actually become a sovereign individual I

guess uh with um in terms of being able to hold and control your assets you would need to withdraw your b2c and E to their respective chains and by doing that guess what you're now a crypto user because you have a wallet you drew eth you to withdraw that or btsc there was an on-chain fee paid and now you're a crypto user so that's the Buy really to me it's not it's not a high bar but that is definitely the bar because just throwing your assets on a centralized exchange you don't get the same security guarantees even if it's the legit centralized exchanges but withdrawing them to your own wallet and self-custodying that's that's uh in my opinion using um you know the these kind of like products and services as well all right last up here speaking of wallets and self-custody uh Soul wallet

introduced the soul wallet smart contract design today so they said here this will be the foundation of our ERC 4337 smart contract wallet that ensures permanent user ownership while enabling the benefits of account obstruction this is for the ethereum community now there's a nice graphic here that you can take a look at for a breakdown of exactly how this will work but then they also detail this in the um the Twitter thread Kia which is not that long but it gives a lot of detail about what they're actually going for here and for those of you who don't know Soul wallet is an account abstraction focused wallet I am an investor in them just a disclosure here um but they are definitely building something really cool and you should go check out their smart contract design uh Twitter thread which I'll link in the

YouTube description below uh but that's it for today so thank everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe to newsletter join the Discord Channel and I'll catch you all next week I mean I'll catch you all next week as a solo refueler but tomorrow you can expect the episode with Eric Connor and I so look forward to that but anyway thank you for listening and watching