The Single Shard Thesis | Logan Jastremski

Transcript

we have extremely high conviction High throughput chains are going to be the future of the industry and ultimately like vitalik's end game this is where the entire space has to go if you really want to scale hey everyone welcome back to another episode of Xerox research today is May 1st and we have a great interview with Logan jostremski the co-founder of frictionless capital and we really dive deeper into this idea of the Solana thesis and the value in high throughput blockchains but before we get into the interview we're joined by effort capital and Matt to discuss the latest Market happenings uh guys it's been a pretty rough 24 hours for Bitcoin and eth I think they're both down roughly four to

five percent but still flat since we last dropped a pod a week ago I'll toss things over to you effort how's uh who do you got in the hots here the cool Throne this week yeah thanks my first Hot Seat is crossover bank so it was announced on Friday morning that FDIC issued a seasoned assist to crossover back in March so for those of you that don't remember during that large usdc de-pegging event after Silicon Valley Bank and um and the other bank classes for getting the name I'll cut my head uh crossover Bank was the new partner for uh Circle that was a good issue instantaneous redemptions and mints um

so on top of Cross River banking the cease and desist from the FDIC because of unsafe lending practices I'm also kind of indirectly putting usdc on the hot list because we're seeing you know we just saw um First Republic Bank go under uh we're seeing like a stress test of all the regional banking infrastructure out there and there's not many other avenues that Circle can really take in the event that uh crossover does get shut down um I mean we're not at that point yet crossover already responded and so a circle so that they are they believe that they have strong and sound uh lending practices um it doesn't sound like crossover is going to get uh shut down from this but it was more of like an initial warning to them say hey look we you know as the

FDIC as a federal regulator we don't approve of your lending practices I mean you need you know you have some work to do and cleaning up your your overall operation um in addition to this I'm also putting coinbase and cbeath on the hot seat so we're about 19 to 20 days uh post chappella which was supposed to be really a boon for liquid staking derivative growth uh now that there's more confidence in the market that you can withdraw your eth once you stake it um theoretically or whatever one thought was that you're going to see an increase in liquid staking in in the market and you are seeing that the problem is that you're not seeing that with CBE so over the past 30 days even though that was 10 days pre-shapella CBE market share or I'm sorry CBE market cap is flat if

anything it's like three quarters of a point uh down uh meanwhile decentralized liquid staking token providers like frax and Rocket pool are both up approximately 30 percent uh over the past 30 days so this is probably just because of an overall like lack of confidence in coinbase you're actually seeing that reflected in the stock price right now it's approximately fifty dollars as of today on May 1st um taking a really big beating um most likely because of lack of confidence under also just de-risking due to their earnings coming up uh I believe later this week yeah the the CBE node is is pretty interesting as you mentioned like broadly staking has increased but it's actually been pretty large outflows from the centralized

providers right cracking and binance and coinbase obviously Krakens kind of had to unwind their uh their staking offering but uh relative to the other two centralized offerings coinbase is you know one or two percent drawdown really isn't uh too too bad in that light but as you mentioned these uh decentralized protocols have pretty large inflows right I think Lido since the since chappella is up around five percent so not a huge number on a percentage basis but it's like got a significant moat in terms of the total number of stake teeth um so it's it's really interesting to kind of see this shift towards either decentralized products or yield maximizing products right like you know frax is quite centralized in its current

state but it's Unique two-token model is really created this like higher you know ticket number yield that you can get I'm just looking at the D5 llama dashboards usually about a full percentage Point higher you know I do think that makes it a bit more of an attractive offering but I'm curious uh effort where do what do you think bass fits into to coinbase's plans I think um there's a lot of like thoughts on this I ultimately think it really comes in it's a really good product offering in addition to what they already offer with coinbase Commerce so for those of you don't know coinbase already has like this square like competitor uh like point of sale for mom and pop businesses they provide like 50 less service fees for any kind of uh payment uh at a

business and I think really what this is going to lead to is uh some type like coinbase owned and branded decentralized Services uh whether that be marketplaces like I could eventually see even like and this is probably far out from now but I can theorize where I see a coinbase branded like uber competitor a coinbase branded doordash competitor like it sounds crazy and I know a lot of people think it's very Boomer to think of uber on the blockchain or doordash on the blockchain or Airbnb for that matter but I think you know as a normal user I see like exorbitant fees from these web 2 providers and I think coinbase's own base layer can not only become like this kyc seed decentralized application for P2P marketplaces that are coinbase branded

but in addition to that just like a really good developer playground and sandbox to create um you know the future mainstream uh consumer applications and obviously a lot of developers know that coinbase has an extremely large user base or 100 million active users I believe last time I checked and in a world where most applications and even the largest D5 applications like uniswap we were talking about this morning in our chats has about 500 000 active wallets and unit swap has what 80 market share and crypto the overall user base in crypto on chain is extremely small and I think coinbase is in a really good position to leverage base account abstraction all the other different improvements that

we're seeing of like the on-chain experience they're gonna be able to leverage all that into the base products where users don't even know that they're like interacting on chain so um I'm really excited to see what they do at base I think it's going to just like a really good playground for Innovation from third-party developers but I also believe that coinbase is going to create like their own branded products as well Alfred I'm curious you're like the cosmos bull out of the group so when you heard that bass was launching as you know an OP stack chain did that kind of change your thesis at all or do you view your uh coin in your brokerage account as kind of your eat exposure yeah that's honestly just that I think um definitely a big Cosmos bowl a rolling majority of my portfolio is in the cosmos ecosystem I think it's like

uh one of the best like design spaces and I think it creates some of the best toolkits for developers to you know own their whole stack create the best products out there coinbase coin stock is definitely my exposure to the ethereum ecosystem I wasn't necessarily taken back by coinbase choosing op stack I think it makes sense right like it's a good business case that's where all the users are that's where all the liquidity is um and ethereum's still like was the founder or like the forefather of decentralized smart Contracting platforms it'd be very silly for them to I don't know create an avalanche subnet uh create a Cosmos app chain today it made sense to start off on base and build on the op stack but with that being said I personally think that

coinbase is going to be Tech agnostic I think by choosing one horse in a race they're only hurting themselves and I think they understand that the future is multi-chain they've invested in a lot of things on their Venture side that kind of prove that point that like look communities are ultimately going to decide to stay on the chains that they love the Solani ecosystem extremely passionate about what they have over there the cosmos ecosystem and Avalanche ecosystems are very passionate about what's over there and ultimately coinbase is going to try to build to where the communities are the largest communities on ethereum let's start there but eventually I would not be surprised if they build a Cosmos app chain or a cosmos like roll app on top of Celestia an avalanche subnet I think it's kind of just like a progression

I'm super curious to see if you're gonna have to kyc to get over there so like I think we've talked about it a bit before but obviously applications might have their own kyc requirements for instance Ave already has Ave Arc which is their permissioned version of the protocol so I don't wouldn't be surprised at all if we see stuff like that but for me to bridge over to base am I going to need to kyc and how is that going to potentially impact you know the adoption of the L2 so that's like kind of what I'm most curious about when it comes to base but I'm also like you know Overexposed to coin and uh I'm a big fan of the coinbase as a company one thing that's interesting on that is uh they were air not airdropping just Distributing like Gorly base eth to

developers and saying like hey go play around go mess with things go build things you know go come up with some cool ideas for bass um which lends me to think like of course that's testnet and you know that doesn't just mean that there won't be kyc but that like you know that open invitation to come build at least maybe that's just my optimism speaking but uh hoping that you know there actually won't be those barriers to entry but we'll we'll kind of see how this plays out um I have a semi-tangent hot hot seat too cbes um with arith so first of all I love rocketpool I love what they're doing the atlas upgrade has been nothing but a success you know we've seen the migration to LED eights go wildly successful already 30 of the mini pools on the network

um are lev8 so huge success there there's just one piece that I do have questions around and it's specifically related to how our youthful trade in large risk-off events so rocketpool is really well designed to create this ecosystem that is very beneficial to node operators and the other side of that equation is you need our eth depositors to be matched with node operator deposits and to spin up 32 each validators and it's almost to me as if they've really created like a first class second-class citizenship within rocketpool and node operator is sitting at the top of the stack so what I mean by that is our eth depositors have no ability to force validator withdrawals

and I do think that was a minor issue that could really come to light and again these large risk-off events and so why that is is the way when the way that RF token contract is built right so when validator exits and partial withdrawals happen eth flows into the token contract our eth depositors or token holders can then go to that contract and say Hey I want to redeem my reef for Native eth and in the event that that token contract runs out of eth to redeem against there cannot be more redemptions processed so the next thing you do is go to sell on the open market in a decentralized exchange excuse me Rockefeller does an excellent job running a incentive program with balancer they have about 78 million

dollars of liquidity in the balancer pool and nearly a million or about 750 000 of plus or minus two percent liquidity so they've done a great job making that a priority but in a large risk-off event there will be sufficient cell pressure to move the price lower of the Peg and when that happens there's only one party that has the ability to purchase our eth off the open market and fix that Peg and that is current validators because if I'm just a Speculator and want to you know buy the dip on our eth I still can't now I hold the token I bought it let's say at a two percent discount I can't force the validators to exit free up my liquidity and then process my Redemption but if I'm a validator for Rocket pool and I operate

a mini pool I can go purchase discounted Reef unwind my validator and bundle that transaction with an arith Redemption and close that Gap myself the issue there is there's a mini pool cue right now and it's about six and a half days so if I'm a validator now I have to exit through the East withdrawal queue that's a couple days um and then to re-enter after I've captured this Arbitrage I have to give up six and a half days of yield um and adding the withdrawal queue to the mini pool queue you know you're giving up three or four percent of yield so on an annual basis and if that's the case like I think that re speg May struggle um in a large risk-off scenario and so like coinbase you can go to them and

process withdrawals Lido's design mechanism has an ability to force validator with withdrawals this is something that wasn't designed into the current rocket pool design and again I'm a little bit worried about how this Peg will kind of like handle these large cell large cell pressure scenarios yeah I think that's a good call out Dan like clearly there needs to be a little bit of work on on the design for processing withdrawals at least for people who are just holding the token and using it throughout D5 like they want to be able to get that under buying Ethan a riskov event but I just find it hard to believe like if I saw re trading at a 10 discount I'd be buying that up like you know it's backed by validators with e flocked in the beacons Beacon chain

staking contract and you'd think that if it becomes much of a problem they're going to prioritize fixing it and making it a better solution for users so I'd be totally fine taking that risk personally um just because maybe I have some fomo for not buying Steve at you know 87 cents or whatever back in May so I'm not gonna pass up on an opportunity to do that again no that's that's a very good point I do want to make a specific distinction here arith is back one to one 100 there's no question about that it's just the liquidity of that backing right like you can't necessarily access the eth that backs your reef at will and that's that's the concern here but yes thanks for thanks for bringing that point up Sam

yeah I would also just Echo what Dan was saying and that this is really only an issue and that large risk-off situation right we have hedge funds who are in the same mindset as you who are willing to buy our eth or I would imagine there's hedge funds that exist that are willing to buy Ari that even you know four or five six percent discounts that's a lot of that's a lot of money to be made especially if the withdrawal queue is only sitting at you know two three weeks but in a risk-off scenario where those hedge funds go dormant and they're like you know they're just not putting any positions on and it's kind of just us minnows who are willing to buy this discount like I think that's where there could potentially be an issue in this mechanism design but I definitely tend

to agree with you I'm a buyer also at 92 cents no question yeah no and it's really just kind of like this balancing effect for Rocket pool right they have these two parties node operators and res depositors who want the LST and they kind of just have to balance the incentive games between them and they kind of like there was a deposit queue before chappella now they have a mini pool validator queue right so they just need to kind of find where that middle ground is and I I do ultimately believe that they'll kind of Trend in the right direction of finding that balance um but Matt who you got in the hot seat or cool through on this week in the cool Throne I'm putting snx perps V2 and specifically Quinta which is the most popular front end for accessing this product so for those that don't

know snx offers you know Perpetual Futures through perps V2 anyone can go build a front end and access the snx Staker liquidity uh so basically Traders are trading against this pool of s and X takers their mechanism design is a little bit different than like gmx's glp or gns gains Network and their GDI and it's kind of cool where they basically have a have a funding rate that incentivizes traders to basis trades so that there should be an equal amount of open interest long and short at any given time so this mitigates the potential for Traders to profit against the pool for snx takers to lose money although it's still possible it just it attempts to mitigate that that externality it's been working really well so we've seen today that the youth pool's open

interest is really just hovering around 50 on either side 50 long 50 short additionally this was found in the Discord by one of the other analysts on our team Westy Capital so big shout out to him on finding this but soon there's going to be a blog post announcing that uh between five and ten percent of trading fee revenue is going to actually be distributed to the front end so to Quinta and other front ends that access these you know the the liquidity there this is really cool right because it's like actual fee volume and I'm pretty sure if I'm not mistaken on uh some of the highest volume days Quentin seeing like between 500 Grand and a million dollars in Daily fee Revenue so you know at a 50 million dollar market cap you could actually look at like it it's cool that you can maybe build a fundamental

investment thesis around investing in cuenta or these other front ends you know everyone's gonna have to make their own decisions there but it's just something to keep an eye on and I'm definitely putting the perps V2 and the most popular front-end Quentin the cool thrown today yeah I think this one's rightfully earned Quinta deserves it uh I believe last time I checked synthetics has 11 million dollars of non-stable or sorry of stable assets and around 55 million of snx I'm not sure exactly how the X and snx is going to get redistributed I think there's maybe some talk from the Discord saying that it could potentially be burned or maybe it would get handed out but nonetheless all those Stables probably are going to go to quantity users considering the fact that they make up what 95 of perps

volume nowadays not exactly sure Westy just made a dune dashboard actually that we can link in the show notes that everyone should check out it's really cool but yeah super bullish for Quinta that's for sure Sam who you got in the cool Throne this week yeah I've got a paulinia or polynia however you guys pronounce it uh he's an anon on Twitter uh he made an OP governance prop or not even an official prop yet but it's just on the Forum over the weekend that once again Westy Flags so Westy's not here but he's with us in spirit I guess but should Westy be on the the cool Throne this week yeah for real for real so basically what he's trying to accomplish is removing the two percent annualizing fresh inflation rate on op I believe eight percent of the supply is circulating right now and next year like

over the next 365 days starting today that inflation rate uh increases to 270 so basically it'll be 2.7 times more circulating Supply this time next year and he just points out how unnecessary the extra two percent inflation is he also in previous posts he actually sent me down a rabbit hole clicking on all of his hyperlinks on on his post but he he or she uh thinks that insiders should have been allocated less than a third of the supply kind of too late to fix that he also thinks that op incentives should be released when key Milestones are hit by the optimism foundation so let's say fraud proofs get implemented finally something that everyone's waiting on um maybe like a certain amount of the

tokens actually vest upon that Milestones achievement so I just like how he's thinking about this he's got takes that I I really appreciate and I think he was warranted for for cool Throne I think this is really is just a broader discussion around poor tokens poor token design right like yeah you just mentioned three or four things that they should have like very obviously done differently and now it's kind of hard to change that after the fact the two percent inflation thing that feels like a mute point honestly like if it's there like what's the net impact of that when your supply is ballooning as Vester shares or investor shares vest um you know like three or four acts over the year like what's the extra two percent at that point

um so I get it from that perspective but I I don't know I feel like the I the broader point is like we need to think about token distribution more holistically and not just like rush to get the thing out the door along the same lines of like token distribution I think the entire space needs to come up with like a way better standard for airdrops um I don't know if it's going to require like a decentralized identity solution to come out before that happens um but we've just seen like so many people cycle all these airdrops like overwhelming majority of the token airdrop goes to a select few of people that are just incredibly good at cycling um but along the same lines of just like having a better token distribution I think it's funny because like optimism

is real you know on the surface they're very well known for like retroactive public goods funding and like Kumbaya we're all in it together but at the same time it's like to your everyone's Point like a large Supply is going to be unlocked and probably dumped on op token holders uh in the next 12 months so it's kind of I don't want to say disingenuous because I do think that what the work that op is doing and like all the work coinbase is doing aligning themselves the optimism Community it's like all good and they're clearly aligned like the ethereum community so I don't want to say it's like all in bad faith uh but it doesn't look good like there's definitely clearly better ways of creating like Milestone vesting schedules to make sure and hold the optimism like Collective accountable for

hitting these milestones and further decentralize the sequencer especially in like a regulatory environment and this goes for arbitrary too like in a regulatory environment at least the United States where like you can clearly you can argue that the centralized sequencers are money transmitters and like they have obviously like a natural incentive to decentralize their stack over time but I think also aligning the tokens uh schedule either like uh I I think align the tokenomics along with like Milestones like the centralized sequencer and the rest of the stack like can go a long way uh to just do having a better Community environment yeah on the note of uh sibling and airdrops so the next highly anticipated airdrop is layer zero uh or the proxy

for that has become Stargate the the premier bridge over there uh and if we look at the number of transactions in just the last 24 hours so random sample but go to D5 llama check out their Bridge dashboard at literally any given point in time this trend will remain true so the number two most active bridge by transaction count is multi-chain coming in at 7 200 transactions in the last 24 hours Stargate is number one with 382 000 transactions so it's either that much better of a bridge or to your point it's just getting absolutely destroyed by cyborgs it reminds me of like metamask volumes meta Mass transfer um swap volumes and

it's just like it's all it's got to be all cyber attacks you know I use Stargate sometimes I actually made the mistake a few times of going from mainnet to an L2 like going to arbitrary we're going to optimism using Stargate you pay like 50 you probably pay something like eight to ten times what you pay using the native Bridge so yeah anyone that's doing that that direction uh and this is a hit on me too you should change and not be doing that but yeah it's definitely definitely interesting yeah you can definitely get ping for fees on Stargate um but to your point like going L2 back to L1 I think Stargate is generally cheaper just to add to this like the fact that there's most likely sideling if you just

do some quick math about the the bridge volume and the number of transactions the average transaction like being sent over Stargate is like 175 but the average transaction size for multi-chain the second largest in terms of 24-hour transactions is uh it's like 3 500 or 3 600 which I'm not saying I I doubt the multi-chain users are like richer than this target users like it's clearly sibling and I hope layer 0 comes out with a way of of stopping that or not stopping it but figuring out a way around it and not making sure that a small handful of people get the future layer zero airdrop but most of the space is a grift so it's they're probably gonna get get a large allocation of the airdrop anyways from my short conversations with the team it

sounds like the lzo token is not on the short short time frame Horizon you might be better off setting up a node for Celestia if you're trying to cyble an airdrop but that's just my opinion I don't know I'm not an airdrop Hunter yeah and going back to like optimism and arbitrum arbitrum waited a lot longer than optimism to launch a token and I think that's smart I just would have loved to have seen longer than I can't remember exactly what it is but I think it's like four years like I feel like these vesting schedules need to be like eight years ten years like it's gonna take a while let's be honest for there to be really true mainstream crypto adoption and ideally you want the users to own the protocol itself so I feel like it just kind of makes more sense to

to drag it out a little bit longer and that's also a good way to like extend the runway of how you fund the protocols development right like you see these short vesting schedules get you know blown out and like if we fast forward three years and the protocol is Still rocking like that would have been like investing that over time the developers still would have gotten their fair share of creating this incredible technology but now there's still Capital flowing into that pool to like contribute to the next generation of developers that come along to build the protocol so another thing to think about as well all right well I think that's a good time to head over to our interview with Logan jostremski all right everyone we are here with Logan jostremski the co-founder of frictionless capital thanks for coming on Logan you want to

intro yourself to the audience yeah thanks for having me guys I really appreciate the opportunity I think uh we'll all get lots of spicy takes out of this podcast so uh it feels good to be on the other side of the mic I also do a podcast in the space uh interviewing technical people so it's fun to be on the other side but yeah happy to do a quick intro I started my career out in Silicon Valley ultimately ended up at Tesla running the global supercharging network uh it was a super interesting time definitely learned a lot at Tesla and it kind of reminded me of my old Collegiate swimming days uh where you can definitely push yourself much further than you thought and that was kind of on the physical side and I would say Tesla was definitely more on the mental side

so that team in the camaraderie uh definitely brings you together and you're able to achieve a lot in a very short amount of time but I think the biggest thing and the true reason why I wanted to join Tesla was just kind of learning how they thought about product and building unique products that they do and I think one thing that definitely I took away from that experience was that first principles analogies and how to actually reason from first principles and I got involved in crypto in 2017 and was very interested in kind of icos what was going on in ethereum and kept with it throughout the bear Market and ultimately I would say describe myself as an eth maxi and then kind of

learned a lot on the technical side again after departing Tesla and just came away with a different view from the space and ultimately decided to start frictionless Capital where we're focused on exclusively investing kind of what we've dubbed the Next Generation blockchains and these high throughput architectures that I think truly will have the ability to onboard the masses and that's primarily uh what I'm excited about and a little bit about me awesome thanks for that intro so I guess we'll dive right into it what is your investing thesis like how would you say why do you think High throughput monolithic chains or the the end-all be all over in ethereum architecture I think I mean on a high level and we are kind of talking a

little bit about this before on the podcast the reason why I got so excited about crypto more broadly is just the permissionless nature being able to have self-soverty like all these things were like yes they clicked with me almost immediately but I mean coming from my product background and being very focused on the analytic side of the things I saw a different picture of what was actually happening when you look at the analytics versus like what people will tell you or what even the media writes and so when I started looking at like doing analytics I saw uniswap only had a couple million users like lifetime active users this is not like even daily users when you compare that to like web 2 like these are like fractions of a percentage it's a rounding air and so

ultimately I just got a little bit sad about like some of these metrics on chain and this is across all blockchains they're not even specifically talking to ethereum we just really haven't gotten to that point where the infrastructure um allows kind of lots of people to interact with chains or with applications on chains and so I think why we're exclusively focused on these high throughput Networks um Solana sui Aptos uh even say Network and the cosmos ecosystem is because we think that these are the correct architectures that make it simplistic for users simplistic for engineers to build applications and for those

networks to continue to support scaling uh when you need more either throughput or more infrastructure is required to actually go to the masses so it's more like I think a user adoption thing like we're just we want users and today it just saddens me that that is not the case yeah absolutely agree with you there and we think about Solana you know it's at an uh an eventful uh you know first couple months of its existence and uh even throughout the the past bear Market you know we've seen continued Innovation happening and a lot of that's now starting to come to fruition right xnfts are this a very interesting idea uh and we saw like the first use case of that kind of get borne out through these mad Lads mints and this comes at a time

where you almost feel like uh some of the activity has died off uh on chain specifically speaking to Solana at the moment uh and you know a lot of that had to do with the FDX unwind and their involvement there but even if you zoom in a little deeper and look at the nft market specifically you know we've seen some major projects like d guys or Utes migrates a polygon and so it feels like this uh nude level up if you will in in techno technology creating these executable nfts um kind of presents a very interesting moment I'd love for you if you kind of like dive into what an xnft is and really how that's an upgrade on the current technology for sure uh oh happy to start on like backpack and xnft's uh they're a portfolio company a

frictionless uh we're very excited to work with Armani interest and the founders uh backpack uh and then I can even go into some of the things that you mentioned with Solana's hardships as well but on the backpack side uh they're a very I mean Armani was the technical gigabrain behind anchor uh for those that you don't know anchor is kind of the predominant framework that people use in the salon ecosystem uh to build applications um and Armani was kind of the engineer behind all that but what they really took with backpack is um the ability to make code tokenized and that's executable uh nfts and so it's

kind of a relatively simple idea but I think all good ideas in hindsight seem a little bit obvious and then uh you always ask why why hasn't someone done this earlier but allows you to essentially one uh just have ownership over that certain asset and I think one of the first instantiations of this are actually there's quite a few uh applications inside of the backpack backpack is their kind of wallet and it is kind of what we envision at frictionless to be more close to the end State uh I think we've seen a couple iterations of wallets today metamask being the first uh then you kind of had

Phantom come in give a much cleaner user experience allow you to view your nfts but what we think backpack is really pushing towards is creating this like open source experience where you're interacting with applications natively in your wallet and these xnfts are the first instantiation of allowing one developers to kind of get distribution inside of the wallet but also um users to have a more seamless experience about interacting with applications directly inside the wallet instead of kind of being a orthogonal experience where you're going from one to another

um so super excited about what they're doing uh I think xnfts are kind of the Trojan Horse and mad lad being kind of the first product of that but the backpack team and what they're building in the broader ecosystem there I think is the truly exciting stuff um and so we're we're definitely excited to be working with them on the Solana side I would definitely agree it's been very eventful for Solana uh holistically I mean several outages all the stuff that was happening with FTX they I would say continuously have I would say shutting themselves on the foot so to speak and it's a little bit unfortunate because I truly believe they

have some of the coolest Tech in the game um but some of these outages have kind of made people think otherwise and I think over the long term people will kind of come to the same conclusions as us actually we're extremely confident about that it's just how long will that take um and so on the outages front I mean Solana had a couple issues um specifically around kind of like DDOS attacks on the networks um and ultimately they implemented two fixes here one is called quick and the other one was quality of steak wake service so ultimately there are just two

mechanisms really that the users won't really experience per se but what it allows the node operators to do is kind of throttle traffic slana is a high throughput Network gas fees are relatively cheap and that manifests itself very well for users but from the node operation standpoint it can be a little bit difficult to handle all that high throughput and high traffic so they implemented these two things and the Network's been performing much uh much better I think alongside of yeah let me stop there I'm kind of been renting a little bit but aslano's done a couple things recently that allowed the network to perform much better I'm pretty optimistic that once fire dancer

again goes live and that's going to be Solana's second validator client the only uh Software System that has only blockchain outside of ethereum that has two validator clients that will help a lot with redundancy as well yeah fire dancer is something I'm super excited about personally I think that's like a clear upgrade in performance and um you know last week we were talking to Anatole and he even spoke to just how they kind of like allowed this team to start from scratch and really build it in the most performant way that ideally would have been like this from the start but uh given that there were so many pieces to get out the door you kind of have to pick somewhere to start and and really to create a product right so um continuing on this like idea of improved Tech you know another thing was

that Salon has been pioneering with this idea of State compression um and it's again we see nfts being one of the first use cases of how this is coming on chain and so helium actually just migrated to Solana and was one of the first people to really use these compressed nfts and they minted nearly a million nfts for under a hundred dollars or right around 100 uh and that's just if you can dive into kind of the idea of State a compression and why that's important for blockchains I'd love to get your takes there for sure and I think like if I were to like maybe summarize this podcast and like our point of view more broadly it's just like again how do you get user adoption and I think I mean even ethereum L1 certainly like you cannot meant a million nfts that would just be

ridiculous that's not even close to web 2 numbers and I would say that's extremely hard even on layer twos um and so I think the thing that we're excited about with compression is again like it's kind of showcasing to the world hopefully that if you actually want to build a mass Market product and again this isn't tens of millions hundreds of millions there's very few places that you can actually do that from a relatively economic standpoint on blockchains today and so I think whether that's like Solana ultimately trying to do high throughput at the base layer uh doing compression with nfts it's really trying to think about the future of blockchains and positioning

itself for when Mass adoption does come can your chain or infrastructure support that and I think compression is just one example um ultimately it's just a Merkle root that allows you to store a large amount of nfts in the single route and make the on-chain data just extremely cheap to make millions of nfts so we're definitely excited to see what people can do with it long term but again I think the interesting thing is just like now you actually have web 2 numbers on blockchains and that's like the most exciting thing to me like when do we get more users because at the end of the day I mean ultrasound money or any of this

kind of craziness like doesn't matter if like again only like a couple million people are using these things we need hundreds of millions and billions of people to actually make this like dream uh blockchain and self-sovery a reality in terms of security so I I feel like ethereum is going more so for making it as cheap as possible as easy as possible is a little Hardware required as possible to validate the chain how do you view that in in Solana with the the high Hardware requirements to participate in validation yeah um great question hey I think this is true and we've actually written a good amount about this at frictionless

um and vitalik actually has written a blog post about this as well kind of like the block Builders ultimately have higher Hardware requirements and then if you kind of just want to be a validator of the chain or participate in consensus you have lower Hardware requirements and I think I mean ultimately this is where in my point of view where all blockchains are going to go and really the only differentiating factor in the true end game is going to be what is the number of full nodes uh how quickly uh can you kind of like finalize transactions or latency and then overall what is the maximum amount of throughput you can kind of propagate at the base layer and so ultimately with light clients specifically

um I think Celestial is truly Pioneers in this regards I think more broadly like clients are going to be applied to all blockchains um ethereum included and then once that's true you kind of have trust minimization for users so today the full node costs is kind of a little bit higher um I think in Solana's case it's like three thousand dollars it's definitely not as high as people think uh some people are like oh it's 20 20 000 plus it's definitely not the case um but with late clients whether it's on slana sui Aptos uh eth I'm I think the factor of cost is going to definitely be

less or people are going to think about it less than kind of these like security debates because like clients will be a dominating factor I think then going to how many people can actually run full nodes because I think that's actually like the true uh question here is like if as long as one full node exists you can kind of recover the state of these blockchains um ethereum to my knowledge has between six thousand and nine thousand it's a little bit harder to like find these metrics but these are like full nodes that actually have uh are able to recover the state um there's a lot of like funky metrics on Twitter uh that say it's like a couple hundred thousand and those are

not full nodes and the full nodes is definitely less than ten thousand Solana's number of full nodes I think covers around twenty five hundred to three thousand so about a third to maybe two-thirds of the overall full nodes so to answer your question I'm not sure it really totally matters as of yet like I I truly don't think Solana is trading off decentralization for performance Solana has chosen and ultimately when I have these debates on Twitter all these costs are all these like different nuances come down to like at the end of the day what should a full node cost and I don't think by Solana prioritizing slightly larger full nodes

that they have sacrificed on security like any bit um if anything I think they've optimized for users and I appreciate that going back to like I want people to actually use blockchains in a slightly higher Hardware class is okay in my opinion another rebuttal you'll get a lot of the time from the ethereum community is uh value accrual uh for for Seoul the token and whether it can actually retain enough economic value to be a good proof of stake type uh slashable token how would you respond to that yeah it comes in a couple buckets I mean I think today Salon is definitely inflationary the true thing again is like all right Solana has kind of

almost taken the approach to uh kind of like Reed Hoffman's Blitz scaling where they're taking a very fast approach like they're having kind of these inflationary um tokenomics at the moment in hopes to actually be attractive to users long term and if you can get to that kind of equilibrium of users that are interacting on chain the economics of uh inflations ultimately come down and can ultimately even be deflationary the long-term goal for Solana is to have I believe 1.5 percent inflation so just slightly inflationary but the big thing here is really again uh kind of like in

three three or four buckets kind of either just outright increasing network capacity so people using that uh using the network um Solana has recently implemented priority fees those priority fees could also be used to offset the networks to get your transaction included into a block uh quicker uh Solana also has what are called fees by contract which is kind of uniquely enabled by their virtual machine and parallelization uh if there's State contention that means you can ultimately everything has to be serialized one after another and this is

how the entire ethereum virtual machine works but if you don't have state contention then ultimately you can paralyze things with parallelization you have a really low fee but if you have state contention you have to going to have these priority fees and that would again have a slightly more revenue for the network and then ultimately you can have some form of Mev as well so it is true today Solana is inflationary I would say I think it's in like six to seven percent But ultimately again slender has really prioritized users and going ass after Mass adoption once they kind of hit that critical Tipping Point of either on-chain transactions or users Solano will either be deflationary or slightly

inflationary around one one and a half percent do you think there needs to be an emphasis on Solana that sold the token being a form of money in order to be like a base layer as an ecosystem rights if you look at ethereum they put a lot of effort into around building a monetary policy for eth that they feel makes sense so I'm curious like do you think having that form of money at the base layer that sort of the economic activity having upon that chain can kind of be priced in does that make sense as a logical thesis to you I think having kind of a monetary policy that is relatively stable over time is definitely useful you can't have the monetary policy be

changing kind of at a whim because no one will know what the hell is going on so but I think in the beginning of the network having that being slightly looser and then continuing to be kind of firmed up over time definitely makes sense to me to say like at the base layer anything the token needs to be money it's kind of funny because ultimately I mean Elon saying is the best kind of money will be the lowest latency and highest velocity and so if something is relatively simplistic and easy to use and people just use it in its day-to-day lives is that considered money

I I guess I mean I think anatoly's Point here too is like there's no like blockchain or engineering kind of point of view that says like I hit it in a database yes this is money it just has to happen organically and naturally and so I think if Solana has a community if Seoul is valuable people will use it as money but it's not something that you can like uniquely program as like an engineering point of view but having like a predictable kind of monetary policy definitely makes sense and I think all blockchains or projects will ultimately kind of coalesce on something that works for them and their team hey everyone big announcement from the blockworks podcast Network we're

launching a new show called Lightspeed and hiring Two Hosts to come build it with us Lightspeed is a show for Builders focused on the use cases that will onboard the next generation of crypto users by taking learnings and inspiration from the garage days of Silicon Valley we really want to capture the perspective from Builders because that's what the ethos of crypto is content experimentation and Relentless Innovation to build products that users can't resist if hosting a show like this sounds exciting to you then head over to the careers page on blockworks.com which we have Linked In the show notes you can also reach out to mirror Sam on Twitter to talk more about the opportunity but overall we're stoked about Lightspeed so if you think you'd be a great host please do not hesitate to reach out right I think that makes sense as well

like just having that you know point of central point of social consensus I think uh just kind of helps build an ecosystem on top of um but I'm like kind of like tie in the idea of the token being a form of money uh with security you know the cosmos ecosystem has spent a lot of time thinking about like the cost of corruption if you will which is you know at 33 and 66 you lose various uh guarantees about liveness and correctness uh ethereum is kind of like in the similar State and that's really broadly around the idea of Economic Security and you know does Solana need the same level uh same levels of economic security or do they think about this just in a different light no I mean I would say this is like true

for all proof of stake networks um I mean and that's like the whole kind of like thought process around the Nakamoto coefficient and like how do you quantify quantifiably measure decentralization and that 33 is extremely important in all proof-of-sake networks including Solana because if you were able to have a single entity control 33 of stake weight or slightly above then they kind of can start uh pausing the network from achieving consensus and slowing down transaction finality and then once you get to 66 they just have total control over the network and can do double sides so whether that's Solana ethereum Cosmos any any proof of stake network is going

to run into these issues and this is really why from my point of view I like the objectivity I liked Nakamoto because it can be applied across all standards uh I think that is one thing that I really frustrates me about blockchain is people will say Salon is not decentralized or XYZ chain is centralized and but my chain is better I'm like all right what data do you have like how do you quantify it and then when you look going back like wearing my product hat and like look at the actual metrics and not kind of just like on Twitter and like people's like beliefs you you can see a much much different picture actually playing out now I mean Solana actually

has the highest Nakamoto coefficient one of the highest Nakamoto coefficients of any chain even more so than ethereum and I think at the end of the day what people are really going to want to use blockchains for is this censorship resistance piece having your transaction being able to be included in a block without being censored the decentralization point is nice like you have to get to a sufficient amount of decision true decentralization but at the end of the day they're extremely valuable police is also is going to be the Nakamoto coefficient how censorship resistance in real time is your network and Solana is leading on this and so I it always confuses me when people talk about

Solano not being decentralized or ethereum like none of it really makes sense like the objectivity is really what matters to me and like even with my podcast like I my goal personally is just to be the most objective person possible and like learn from all these smart people have them like I share How It ultimately the networks or applications affect the developers and then how does the user experience ultimately manifest itself and then from all those different slight nuances how does the ecosystem play out and I I've just like after doing all these podcasts spending so much time on the research side of things I just see the space much differently than others

and that's why we started frictionless we have extremely high conviction High throughput chains are going to be the future of the industry and ultimately like vitalik's in-game this is where the entire space has to go if you really want to scale in terms of the roll-up landscape with uh some of these svms launching like you mentioned Nitro settling to say um and uh there's one more I think eclipse is is potentially working on a solution with svm how do you see that playing out I shoes are funny I am definitely excited about the parallelization uh so definitely appreciate those two specifically to me any single threaded virtual machine ethereum included

I just don't see having a future long term um unless they're able to amend it to do parallelization and the only reason why I say this is again like the ethereum virtual machine uh single threaded virtual machine just means every transaction on the entire blockchains has to be executed one after another there is no parallelization if they're not overlapping you can't run them simultaneously they have to be serialized but all modern compute today is decide is really designed with more cores and it's designed to take advantage of parallelization the more cores you add the more parallelization you can do and so to me it seems fairly obvious that if

all kind of Hardware architecture is being designed for parallelization and you can't do parallelization you're kind of again shooting yourself in the foot and so specifically to your question I'm excited about l2s that kind of either take advantage of this parallelization have like defeat isolation which is extremely important from the user standpoint uh another drawback about single threaded virtual machines is they don't have fee isolation and we've seen this problem come up again and again on ethereum and even l2s where I mean I think stani recently did a podcast with bankless and it was talking about like polygon was great uh when we are kind of like one of the few kids in town with lens but now they're getting other

traction and because there's Global theme markets we're kind of getting price out and now we want to explore a layer three and like to me a lot of these ultimately it's just like the real magic of blockchains in my opinion was being able to have things like defy summer where everything was on a single shared State and you can have composability and that makes things interesting and so to answer your question directly I think 99 of layer twos today are not going to achieve the purpose that they want and so we're not primarily focused on them if you can have a very high throughput

layer one if you can do fee isolation if you can do parallelization why do you need a layer two it's not it's not really helping if anything it's just making it so you have faster latency and a particular part of the world because you have kind of fewer sequencers running that particular thing and that's helpful but I don't think particularly for very many use cases at least today those are needed ethereum has to have them because they're trying to do scaling and kind of like put put themselves into a corner but yeah l2s are funny I I think people people are trying to experiment with

them and I'm interesting to see how their experiments go out do you not believe that there's an upper bound um on the data throughput of Solana at a certain point though or are you thinking you know technology increases at a certain rate becomes cheaper over time is that the camp that you're in am I right and assuming that uh the upper bound is the same to all blockchains I mean the true physical like Network constraints are like the fiber optics so whether it's like eth was sharding and like they have 64 shards a billion shards it doesn't really matter because you're going to be constrained by how much data you can send across the Atlantic like that's your upper bound and whether that can happen on A Single

Shard or 64 shards in like ethereum's case or four shards it's all the same so my point being if it can if it's physically possible to keep this all kind of logically centralized in the sense of developers don't have to program against it users don't have to bridge from place to place why not develop for that type of world I think it just makes applications easier it makes developers lives easier you like concentrate liquidity it just seems more easy to me and I think if I've learned anything I mean from Tesla it was keep it simple and keep it dumb and like I kind of like the

dumb design of A Single Shard like it it makes everybody's lives easier and like I want to be clear like I mean Salon is kind of the first instantiation of these like next Generation blockchains we're very excited about Solana sui is also taking this approach SEI is also doing something similar their focus just specifically on defy so we do have uh we do really enjoy Solana but there are other ecosystems newer ecosystems that are coming out of Silicon Valley uh particularly uh with kind of old Facebook Engineers or meta that are also taking this approach I think the interesting thing is if you're a new

engineer today kind of seeing all these different trade-offs blockchains do not look like ethereum they look much more like Solana and I think that's kind of interesting to say the least one of the most exciting developments you just mentioned actually was isolated fee markets during this mad Lads mint there was a ton of activity going on it actually crashed the backpack app itself just being you know the first instance of actually the thing going live but what was super interesting to me is how effective the isolated flea markets were right the only thing that was expensive to do on chain was to Mint this one nft can you talk a little bit about you know what the unlock of isolated view Marcus is and I'm curious like because Solana spends all this time thinking about

parallelization and how state is affected with each transaction is this actually why they were like oh hey you know we could actually just only make the things expensive on this piece of State because we're already spending all this time measuring what state is impacted exactly and so uh where do I start ultimately this is enabled by the virtual machine and again this is why we love parallel paralyzed virtual machines and like are pretty much focused on the ecosystems that enable parallelization it seems like a nice thing to have today but I think going forward it's going to be industry standard and if you don't have it again like you're kind of shooting yourself in the foot primarily because of what exactly what you just

mentioned uh and the Solana case that recently happened um backpack nfts dropped uh a nft collection uh 10 000 mad Lads when you have a paralyzed virtual machine you're able to isolate specific contracts on the blockchain so in this example the nft mik contract was the only thing that would have slightly elevated fees because people can prioritize whether they want to get into the block but no other transactions are affected on the network and this is like super interesting uh and again going back to like stani's example with like

layer twos or even just ethereum more broadly like you can have an nft mint going on and then like a uniswap transfer or like swap is like 200 300 bucks you're like ah there's an nftment going on like I'm screwed but by being able to implement these contracts at a being able to isolate fees specifically to a single contract is the real Innovation and ultimately it allows a better user experience and it allows you better scale because if transactions are non-overlapping you just execute them and they don't have to wait for anything and that's where the parallelization comes in and so this was like a true massive unlock in the salon

ecosystem so he's also doing something similar that is the fees per contract is enabled by their data model when I talked with Aptos they're also going to be moving in this direction eventually I think they're doing Global fee markets to start but any any blockchain in my point of view again that like does not have like isolated fee markets this is the reason why like people are kind of going to l2s and then you need an L3 is because these fees just get crazy if you cannot isolate them and the isolation is the real kind of like unique unlock that can allow things to be Live On A Single Shard you mentioned earlier that it primarily comes down to the data throughput of the base layer so

how do you expect things like Celestia eigenda um polygon of Ale how do you expect that to play out like won't they probably have more data throughput than uh a Solana as a monolithic chain those all three examples are taking a little bit different of approach so let me try to just parse apart each um Celestia ultimately has full nodes um every blockchain needs full nodes for like security purposes those full nodes are going to have very high throughput um similar to Solana and then they're going to have light clients uh do data availability sampling uh the more light clients that do the data availability

sampling the higher they're going to be able to crank the full node throughput so that uh they have more um essentially that they feel comfortable with like the level of security um and that's like an interesting approach I think Solana will ultimately do the same uh slana calls them diet clients but selana's point of view is all right we'll have the full nodes and then eventually we'll implement the light clients and then if people want to run like clients go for it um so I I do think Celestia has pioneered a unique approach and specifically with like clients I think they're the industry leaders and a lot of people are learning from them and uh

implementing similar things into their chains um with eigenlayer ultimately they're doing kind of data availability sampling um and again I I asked this Twitter this question on Twitter recently like is data availability is sampling a product or a feature and I don't know if there's like a sustainable business model just for like data availability sampling like you need the other components of blockchains as well and if that's true then if someone really wants data availability sampling um that eigenlayer does I mean I don't see why not you can't implement this on high throughput blockchains as well

um and then polygon Avail as far as my knowledge is a data availability Community I'm not like a big fan of these because ultimately you just have it goes back to like the decentralization component whether it's like sequencers like a SQL sequencer 10 sequencers uh a data availability committee you have one person you have 10 people ultimately in my point of view for decentralization you're always bottlenecked by your like weakest link in the chain and so with the data availability sampling like you can crank the throughput but you're going to have like that small subsample of like people that are running that chain and maybe that's fine but my whole point is like when you start to kind of like Frankenstein these

pieces together and then ultimately they look like a high throughput blockchain in the end why would you just like restart and like create the high throughput blockchain like it they look very similar in the end State you might as well just like create the thing where it's like all right you can focus on high decentralization you can have high throughput at the base layer you can have high scale from the parallelization it's just like in any product it takes a couple iterations for us to like learn what worked and what didn't work and I think Solana kind of being the third iteration or these high throughput blockchains being the third iteration Bitcoin was the first with self sovereignty then you had ethereum with smart contracts and now you have

blockchains that are focused on composability self-sovereignty at scale and like I think those are the things that are going to be unique and unlocking users again like we have to have like useful apps uh and those are still coming but uh the infrastructure does play a big part as well yeah I would say we're in on the idea of useful apps because I think anyone who spent any time here knows that that is something we're still missing uh so I'm curious on your takes on like the app chain thesis let's say you're on a general purpose L1 you have a home run application that you generate a ton of users but you're now I have this activity on the L1 that I'm essentially bringing there and there could be some benefits by moving to my own app chain and kind of being able to change

consensus to slightly and tweak it just a little bit to benefit my users do you think that makes sense in the long run as apps do get more valuable I don't know I I think I mean the only interesting thing that I've seen where you start to mess with consensus is like where you need extremely high throughput and extremely low latency for like exchange types um other than that I feel like people kind of want to say they want to run their own chain because they want to run their own chain like they say they want to do it but uh then they kind of have the headache of like actually running it it gets a little bit more complex I always thought like app chain thesis in my world was going to play out very similar to say and I'm surprised like

say was the first instantiation of this where you have a sector specific so like say in their example has changed the consensus algorithm to focus specifically on order books um and trying to paralyze order books and just uh make the best exchange possible on chain and so for me like all right you have a very large app chain that's sector specific in their case defy um that to me is just more interesting because you also get the composability aspects that that's my biggest thing going back to like why blockchains even matter and like D5 summer like stuff that was going

on with nfts was the composability bit I think our applications today are not really mature enough to to say see composability at scale but I can promise you guys this is probably going to be the most interesting stuff where you have applications that can compose together that you didn't even know what was possible in a couple years down the line and so specifically applications that are just one-off to me there's very few use cases that fully need that level of customization um it's rare I can see it happening occasionally but I think they're misguided today yeah yeah no that's interesting and sticking

on the idea of improving application quality and user experience how do you feel about the Saga Solana's new phone and pushing into that market and really that idea of being mobile first exactly I'm super excited about this uh I think majority of people that actually interact with the internet today do it through their mobile phone um it's unfortunate that Apple and Google have kind of taken an anti-crypto stance uh it's just unfortunate and so I think browser extensions and how we interact with crypto apps today are fine but it would be a step forward and experience a much better experience if we could do that natively on our phone and with Saga

they have a secure Enclave ultimately allowing you to store your private keys where no one can really have access to that um I think it's great uh I wish Apple and Android would also do something similar but I think Saga may be the wedge that actually pushes them forward here um but yeah majority of people do interact with applications and the internet natively and it's unfortunate that that does not exist today I mean we were immediate and um my co-founder in the fun were recently just um we were judges for The Solana grizzly-a-thon and majority of

applications that we actually saw come through were mobile Centric and so I think we're excited about the mobile piece because I think this is where we're actually going to onboard quite a bit of users um it's just funky to kind of do everything today through like desktop yeah I totally agree with you there and I'm sure power users have power listeners of our podcast are tired of hearing me say it but seeing the DAP store directly next to the Google Play Store that was just cool there's no way around it and especially it comes at a time where uni swap launched their wallet and successfully got it launched into the store yeah exactly like that's just a win that's for the industry as a whole so super excited to just kind of see this mobile first thesis really getting pushed forward but I want to

talk a bit about the Solana ecosystem as a whole again you know at the beginning of this pod we talked about the there's been a lot of ups and downs what do you think some of the biggest wins for Solana's ecosystems as I suppose the apps built there and what have been some biggest some of the biggest wins in some set Inception I think on a high level I mean Solana today reminds me a lot of ethereum in like 2018. like ethereum I was around in 2017 everybody was euphoric there was actually a few applications I think Dai came out in 2017 December uh so at the very end of the bull market like it was hard to like actually convert anything into a stable coin

um But ultimately we kind of went through a pretty crazy bear Market where ether tanked to 80 and the bitcoiners were kind of dancing on everybody's Graves from the ethereum side and like ethereum's just used for icos it's a scam it's a Ponzi and I would say like the sentiment around Slaughter today feels very similar to me during that time and I actually have higher conviction today about Solana than I did in ethereum in 2018. uh just because I think the tech is so misunderstood people um kind of falsely communicate narratives that don't exist and refuse to kind of look at the core technology and what Salon is ultimately able to do

and so I think to your question specifically some of the biggest wins of Solana has really just been cultivating a really like fan base like that you slana um I think many chains even layer twos are going to have to go through this process of trying to like cultivate a pretty Vibrant Community and seeing like who defends your chain when goes wrong and that is hard like you need people that will go to bat for you uh inevitably shit's going to uh get messed up at some point you may have bugs you may have issues uh as we've seen

sometimes in this issues arise with even investors so not even directly related to you and so you're going to need to have people kind of communicate what is true or to their best of knowledge like what is the most truthful and try to fight the incorrect truth and a lot of layer ones even layer twos are going to have to go through this process and I think we've seen some even more recently with like arbitrom like they're kind of building that core community that will fight through them fight through the fud whether it's like the community proposals um that is definitely a big one I think ultimately we're are excited about um Saga as well I think one interesting

thing that people have kind of talked about on a large part that's kind of unanimously agreed upon is just stable coins and how stable coins have been uh easy to kind of like the best use case across crypto which is I say exciting and sad uh just because if it's the most simplistic thing it's a little sad but I mean specifically on Solana because it's so high throughput and because you can paralyze these transactions fees are fraction of a penny I mean and transactions finalize and typically a second or less so from a wire transfer standpoint this is amazing Innovation um and then I would say lastly where Solana I think is also uniquely

positioning rooms themselves is in these decentralized physical infrastructure type products the depend products um specifically render moved over uh decentralized GPU compute I just did a podcast with um with Hive mapper they're doing decentralized mapping Solutions and collecting that data uh helium just moved over to Solana and when I talk with them uh either privately or on the podcast they all say the same things these are applications that are just not possible on these other ecosystems and they want the decentralization they want to be able to pay really low fees they

want the properties of a blockchain but they don't want the blockchain to bankrupt their product when trying to build it and so I think we're uniquely excited about that category as well and how alive it's starting to come uh how alive it's starting to be on Solana more holistically so I agree with all of those exciting applications being built out on Solana but I feel like ethereum is trying to solve the issue of privacy in blockchain at the L2 level what is Solana's roadmap on the Privacy front uh I mean Solana has a couple uh layer twos uh that are focused on on the Privacy aspect as well I think it's going to be a little bit of a challenge if you wanted to do that on the layer one but I mean again layer twos are not like

totally specific to ethereum uh they they could be applied to Solano they could be supplied to sui um and they actually work better on like these high throughput networks because you have more data um and that data piece is the true bottleneck to what the cost is going to be uh I'm going to be dropping actually a podcast with uh starkware right after this and their head of product will uniquely tell you it's not like the proofs it's not the creation it's none of that like ultimately the biggest cost is how much it costs to actually post the data to the L1 and at the end of the day this goes back to our conversation

earlier like what is the upper bound of uh data propagation whether it's a single chain or multiple ones it's the physical real world infrastructure of those fiber optic lines that run across the Atlantic and that's like the main thing so um I think l2s work better on Solano um just because they have higher data throughput and if you want to consume more uh block space you can it's relatively simple but yeah to the previously aspect there's Solutions already or in progress on Solana as well I've just got one more question for you Dan if you got another one let me know and hop in here but are you not at all worried that after looking at you know Adam and how that's

played out and now that they're trying to revamp their tokenomics and there's all this drama going on in governance over there do you not have any concern that Solana may end up in the same camp in that ethereum starting from a better spot with kind of a sound monetary policy already in place before it gets started fully scaling to the masses I guess my question there would be like why would you want to like start to solidify something that has like less than 10 million users like the most popular application has less than 10 million lifetime users like I want a rich scale like if you're already deciding these things and you're like all right now I kind of like have to Frankenstein the skill aspect afterwards and unfortunately because of

the decisions I made it's going to be reflective that more users pay higher price for every transaction I ultimately just want people to use these I I don't think necessarily taking that approach was the right one um I want users all right great well that was a fantastic conversation Logan I appreciate you uh coming on the Pod if you want to share with other people where they can find you on Twitter and maybe plug your own podcast my podcast is just Logan just shrimsky podcast on Twitter uh I think I've talked with almost every layer one founder majority of Layer Two Founders on deep technical podcasts and like all these different nuances uh I have lots of spicy takes as

you guys have seen on this podcast but I think they're really rooted and just speaking with the industry experts on how this ultimately manifests in kind of the small nuances whether that's the developer experience or the user experience and I think what I've learned is often the simple stupid thing is the thing that wins so having a high throughput base chain uh is something that we're uniquely excited for uh I have a fund uh frictionless Capital uh where pre-seed seed stage um investing so if you want to get in contact with us on the fund or kind of learn more about why we think we the way we do just reach out to me or on Twitter or visit our website at

frictionless.fund awesome we'll catch you later