[trustless://interop.landscape] Fireside Chat - Trustlessness, Interop, and Ethereum’s Future

Transcript

Okay, and now we're going to move on with a very interesting segment. We have a fireside chat with two experts when it comes to Ethereum. There is a lot to talk about and a lot to consider. A lot has happened this week. The Trustless Manifesto is here. We're talking about interoperability. We're talking about the ethos of Ethereum. What is convenient? What falls within the ethos of Ethereum? What should builders really be focused on? I want you all to pay attention to the QR code on the right that you're going to see on the screen.

When you scan that, you can ask our speakers anything that you would like and then grant that we have time, we will choose the best questions to answer for you. So, please without further ado, welcome to the stage Thomas Stanchack and Marissa Pausner. Hey guys.

>> Oh, hello. Oh, we have the cloud. >> Nice. >> I think this is working. Great to see you. Um, thank you guys so much for coming uh to our trust event. Uh I have with me here Tomas um co-executive director of the Ethereum Foundation uh founder of Nethermind um he needs no introduction. Um so yeah Tomas thank you so much for for being here. Um I guess yeah just quickly if you want to say like one or two sentences like on what your role is as executive director and some of the things that you do.

>> Hi. Hi everyone. Uh so well joined join foundation in April as a co-executive director. My role is probably most of the time to to help people just execute at the foundation and outside of the foundation in Ethereum ecosystem all the different ideas. Uh sometimes it means that they'll have uh conflicting ideas but they but they want to deliver an experiment or or solve big problems in a in a hard way. So I think it's uh it's all about removing the obstacles if possible and accelerating the decision making processes at the foundation and helping with coordination of the ecosystem. Uh it's kind of like simply the role of the foundation and my role

is to make sure the foundation can deliver that role. >> Awesome. Yeah. Is there a misconception that you think that the community like uh misunderstands about the EF or our role? >> Sure. I think that um the funniest thing always that I hear is that foundation is bureaucratic because it's almost like opposite of bureaucratic because at the same time I hear that foundation is bureaucratic and then I hear that foundation doesn't have well specified roles and it's hard to say who does what and and there are no processes. So it's it's really opposite.

So I think we are in between. We are pretty healthy on the on the amount of processes and we are healthy on combining a bit of freedom and decentralization internally and introducing hierarchy gradually. Um so I would say I made it more bureaucratic than it was. It was funny to hear in the past that it was bureaucratic. Um I think that indecision not necessarily means that you have too many processes that are stopping those decisions. Sometimes uh sometimes it's just dealing with the very hard difficult uh legal environment, very difficult set of goals and challenges and uh priorities that you want to set that that may make people a bit paralyzed. So the misconception is we're not bureaucratic.

We're sometimes paralyzed by the weight of decisions that we're making. >> Yeah. It's interesting because I think there's this like tension of like or I think the community often says like oh the EF is uh either too hands off or too opinionated. How do you think that like the EF should balance that? >> Oh, so um we're not really handsoff. We work on the engineering problems, research problems, coordination. So we do a lot of things. Um it's definitely not just some kind of management without touching the things. So we we we work with the protocols, we test the protocol. uh we run the entire DevOps infrastructure for testing all the different combinations of clients. Uh but then when we talking about maybe

handling the ecosystem as being hands off and not taking decisions on who to who to support whose message to amplify uh or maybe like being biased. So balancing I think is on meritocracy. So making sure as much as possible that we always capable of answering questions about what is better for particular use case. It's just that with the experimentation of for example all the different L2s or the different solutions of problems like uh bridging interop that we can tell what are the uh advantages and disadvantages of each each of the solutions. uh and in this way we can actually very confidently

support all the different approaches saying that we know that um they may have failures and and then that over time we'll see clearer and clear which use cases are dominant and and more relevant for the impact that we want to to share. So as long as we remember the set of values um that we that we set for ourselves as a foundation, we know what we want to see on Ethereum. And at the same time, I know that um Ethereum itself may reject the foundation values and this will be totally fair. Uh we don't deserve the rights to to own the chain in any way.

>> Yeah. Yeah. I think it's interesting. Um, if there was like one value that you could pick for like Ethereum's, I don't know, next decade or something, what value do you think like Ethereum should kind of most align with? >> I don't know. My favorite one is open source definitely. Um, it's just that my vision for the world for the future is that we really can play with all the mechanism, all the transparency and curiosity of ours of how how all the governments, how all the institutions work. Uh so having always the insight into what we're building and and being able to contribute to it is is great and I think that's what blockchain really delivers. Um everything else obviously we have the centralization we have

censorship resistance like we deliver security privacy it matters but like if if you talk about excitement of what what makes me feel oh this this is great it's open sourcing the entire world. >> Yeah. Why do you think like open source is most important? >> Why open sourcing? Because it's it defines the permissionlessness and curiosity. And I think that curiosity is for me a driver, the reason to exist a bit. >> Yeah, that makes sense. I think like turning to another value, our conference is called trustless. Um, and we came out with the trustless manifesto this week and one of the lines in the manifesto argues that trustlessness isn't a feature, it is the point. So I guess as EF executive director or personally how

would you define trustlessness in your own words? >> Yeah, sure. I think that um very often we talk about trust and trustlessness and almost when you when you try to find the language that existed in traditional finance, it's almost like trust is the opposite of risk that if you if you trust someone that you don't expect anything unexpected, you don't expect volatility of the future results of collaborating with that person. Um and if you see the risk in a person that it's exactly the opposite. You expect that there will be lots of volatility.

Um it means that if we have such a such a clear opposite uh then we can always go back to the traditional finance traditional world and say you know we can actually redefine everything that we talking about in the context of risk. Um, so then it's it's easier to talk outside of blockchain and say I I care a lot about the systems that can decrease the required amount of uh trust which means the systems decrease the risk and uh if the systems decrease the risk then they decrease the cost of insurance they decrease the cost of uncertainty and uh and allow for more efficient uh more efficient finance. So at the same time you know like trustless manifesto on one side says that it's all about

trustlessness but it's not to make the markets more efficient but it's almost like the same definition. And we are making markets more efficient by uh removing the need of trust. And I think that this is actually the very reason why everyone uh where everyone adopts blockchain in the financial world is that they find blockchain to be reducing risk which is the single most important measure for pricing all the instruments and pricing all the interactions in the traditional finance. >> Yeah. Yeah. I think that the point of the manifesto wasn't necessarily like about that specific finance point. And I think that was like one line in the larger manifesto, but more I I completely agree with your point about that for like finance reducing risk. I think it's like we're saying the same thing just in different languages. Like

finance uses the word risk and maybe in in blockchain we use the word trust. Um but essentially it is saying kind of the same thing. I think um yeah I guess it's interesting how how those play together. I think one of the things that the manifesto talks about is how like trust creeps in silently like whether through UIs or RPCs or etc. So do you think that Ethereum is is do you see this drift happening that Ethereum is drifting towards more trusted servers as a lot of like web 3 products are built on web 2 backends such as you know yesterday with the cloudflare outage we saw you know either scan was down there defy was down there was many web 3 companies that were down so do you feel like we're drifting Ethereum is drifting more towards trust

>> um I think that we are actually drifting further and further away from the trust requirements you practically see Ethereum as an ecosystem that all the people that are building towards removing the trust requirement and to strengthen that property of trustlessness uh on Ethereum. And this is uh this is super incentive aligned when you when you hear Danny Ryan on stage in the last days uh saying talking about his journey of going to institutions as a person from uh who like few months ago or years ago was outside of the traditional finance market and realizing that actually we all uh we all are super aligned that the large institutions, governments and so on say oh we want the centralization we need privacy and we need everything to

be very secure uh and ideally with open source solutions because when remove the counterparty risk and suddenly we realize oh they they name exactly the same values that we name at the foundation. Um and then you wonder so why did we think that nobody cared about those and um this is because within the blockchain space we've been always working with lots of um speculation and searching for risk and when you search for risk that very often you trade the trust which means that even as we build the trustless systems they on the side somehow they built a a major product of being nice space for people that are risk-seeking and very naturally almost by definition the risk-seeking people the specul calculators uh will not care

that much about the trust because they want to to trade it for potential upsides. Um so I drifted away possibly from the from the exact question so remind me >> the the question was uh do you feel like the ecosing >> so I didn't okay um I don't think we are going there I think we are getting better and better it's also that with the growing volumes of all the trades it seems that um more and more mechanism aspects are appearing that tell us oh this was always broken and nobody ever looked at it and um when you think about emergence of ME. It's it's not like MV didn't exist in 201617 or earlier. it was there but people in 201920 started

uh publishing papers and so like oh wow there's more and more volume it's a bigger thing so it's a big enough topic to have incentives for many people with experience in finance in trading to talk about me uh and we introduced some solutions that are already make it much better um and and you may think that oh we also introducing the uh the improvements to the infrastructure in general but the infrastructure at the beginning was extremely trusted like the RP RPCs nowadays we have many more options to choose RPC than it was in 2017 right um unless we would say oh there was an assumption that everyone will run uh their own node but but they were not like very quickly they were

running the RPCs and and all of this got improved um so there are more options and I think the UX the nature of UX is almost in the branding and the product management is that user can actually choose between the spectrum of uh options between total trustlessness and the the full trust and I can decide whether it's more expensive or less as long as Ethereum delivers the fully trustless option um then it's a great achievement but we should always think that uh it's we're leaving that for the user freedom to choose between different UX options >> for sure. Do you feel like it's the EF's responsibility to kind of push back against those trust um assumptions or to

just put it in the hands of the user and let them learn? Like do you think there's anything that the Ethereum has to do at the L1 level or protocol level? >> Yeah, I think I think that EF responsibility is to to make sure that we deliver solutions that might be uh less monetizable and and harder to fund like the public goods with the trustlessness uh solutions. So something that does introduce a lot of impact but not necessarily give anyone ability to like with perfect trustlessness you don't give anyone control and ability to monetize remove intermediaries you remove the owners you remove the operators so you don't really create an opportunity to make money uh but it's definitely not our role to remove those who actually deliver very important

value to the users which is I will allow you to choose of how much of the trust lessness of how much of those security properties to trade for the better experience because sometimes users will choose something that looks more shiny or maybe works faster or maybe is yeah whatever things that they choose >> and we cannot predict all the user needs and it's hard to impose on all the users the particular behaviors. >> Yeah, for sure. I think that something that's missing today in my mind is that is the uh like I feel like applications don't let the user know. they don't exactly let the user make those choices.

For example, if I go to do a crosschain swap, I see the options presented to me. Uh like if I go to like socket, for example, I can see that I I can see the time it's going to take me to swap and I can see how much it's going to cost. I don't see if I'm sending it to an EOA wallet and and I may not and I just have to hope that I get my funds on the other side or if it's going through a a relayer. I just see like the time it's going to take and the cost. So, I don't feel like in the current UX it's presented to the user. So I guess >> but I can always send it via canonical bridge and swap myself right. So >> I mean yes but yeah I mean that will take you know a long time like seven.

>> Yeah but this is exactly the trade of I can I can do something slower and without any trust I don't have to use the relayer or I have opportunity to choose a relayer. >> But I'm saying that in the current UX of um like systems they're not letting the user know the trust assumptions of the different ways. So like I can see all of these different ways that I can send my assets crosschain but I am not told what the trust assumptions of those are. So, how do you like think that that we as the foundation should kind of go about setting those standards or making because I agree with you that users should be able to choose like if I'm sending $10 crosschain, it matters much less like I can use I could use a centralized service, right? But if I'm sending $100,000, I would want to use a

more trustless solution. So, but currently solutions aren't letting um like currently solutions aren't letting the user know this. So, how do you think like the foundation plays a role in that? Um yeah, I mean like so if if you're talking about the situations like very dishonest practices on the on the marketing side like the operators saying that they can just breach but not disclosing all the risks. Um I think that I could imagine the foundation's role in in being educator consistently of all the all the challenges or the risks assumptions and and we probably will put a lot of effort into further education. It differs between the retail users and the institutional users.

Institutional users are are used to the concepts of risks and trust as opposites and they will and they will always verify what systems they integrate with their internal systems and I think if we deliver uh solutions that are properly trustless um whether whether it's a correct EIL design or or anything else that we can suggest they will say okay this is less risk for me less insurance costs and so on. uh and the long-term less volatility. So they will they will choose it. uh and we by educating we can decrease the cost and and like speed up the adoption and let them avoid the mistakes and avoid the reputational risk to the Ethereum as a network where let it be that institutions would adopt

something and say oh our very like experts inside the company made a mistake so as Ethereum that is too difficult that could be a claim and we want to avoid those claims um But is it is it in the end in our role to uh to think about the security on application layer to some extent as well. So we have this trillion dollar security where we say it's not only technology but as a social layer of like education explanation of the UX. So we care about it and ideally it would keep improving.

Um but yeah in the in the end you can execute everything yourself and it's good if you have solutions in between and improving uh access to trustlessness as long the SDKs the integrations actually say oh you can you can merge it with better UX. So then then you reach the stages where you have both UX and trustlessness. Uh and I think that's what you were striving striving for. So it's it's great to see the effort. >> Yeah. And I think it's like all around the communication to the user about that so that they can make their own informed choice. And L2B is actually doing a lot of uh work on this and they're announced yesterday that they're working on a new interoperability framework to rate interop protocols um so that you know this could be something that is displayed to users and also give interop

protocols an incentive to um kind of make those change. Alt bit is amazing and they're doing great job in explaining the risk to institutions like the amount of times where institutions come and ask those questions about like which which O2 are risky or not for what reasons and and the same for data availability and now for interrupts. So great to see that that helps a lot. Yeah, I guess turning turning to intents. Um, so a lot of teams naturally push intents as the future of UX. Um, and the manifesto argues that intents add uh some trust and centralization vectors. Where do you personally stand on this? What's your thought?

>> Um, sorry I didn't hear everything, but I I think that you say that what do I think about the intents whether they introduce the trust assumptions or not? Yeah. Um well obviously like intent as a as a concept is as is really broad. You can you can interpret it in in many different ways as the existing solutions with intents. Um I think they definitely introduce many trust components right. Uh so they do they do address most of the problems related to the to the UX to the need of integrations um and and probably decrease a lot of a lot of risks of misimplementation of of bridging and and the delays. So they

they improve the capital efficiency most likely but um introduce some some risk into all of this which means that they they introduce trust requirements um they but then I always was very very much about thinking about intent as a word as a definition I s well it's it's pretty neutral and you can implement it in in trustless way or trusted way uh but yeah I think that that many existing solutions either either are slightly trusted or very much trusted uh or they're trustless but uh limits the the type of operations that you can execute.

>> Yeah. Um what do you think like generally is more dangerous for Ethereum? Moving too slowly and missing the boat or moving too fast and abandoning Ethereum values? I I love this question because each time when I when I when I hear something like should we choose between moving fast or not making mistakes and so on, I always say that Ethereum should always have only people at the at the most important positions that are can do both. That's the only way to really deliver something impactful and be at the top of the delivery is to move super fast and be super precise and never make mistakes.

and and this is the nature of the expert teams and winners that you move fast and you're precise. Uh so so both uh not choose. So like the moment when we start even expressing that we have choice between those two properties we start to making that choice and we think that it's okay to sacrifice one for the other and then it's like um the very easy way to uh to to accept mediocre approach and I just don't accept it. We have to we have to move fast and execute perfect.

>> Yeah that's the goal isn't it? Um so one of the advantages of the Ethereum ecosystem of L2s is that they settle to the L1 as the source of truth. Um but for all L1s they don't have this advantage. So when designing interop protocols, do you think that interop protocols should be designed with like for Ethereum uh for sorry for L2s that um that have trustless solutions and use this unique property of being able to settle to the L1's or do you think that interop protocols should be designed more broadly that can also cover the scope of alt L1s and other chains?

Um yeah so when we were working on various interrupt solutions for Ethereum we've heard this uh feedback that oh if you design something only for Ethereum ecosystem that maybe you will listed the protocols that uh that automatically include all the alternative ones at the same time I have this strong conviction that over time you have such a dominance of Ethereum ecosystem uh that the only way to get all the benefits of the trustlessness and the and lowering the risk of your assets will be to uh to exist in the Ethereum ecosystem. So on the on the edges like with alternative L1's the amount of risk will be just too high and inefficient and too expensive.

Uh so that maybe convinces me that it's totally okay to build something that is just Ethereum specific. Uh while saying that since the outside of Ethereum ecosystem you have more risk then you can also potentially accept the risk on the additional risk on the bridges. Um so sure if we if we were all the time worried about bringing liquidity to Ethereum uh then maybe it would be more of our responsibility. It will be also our responsibility to to maybe involve more L1's if uh if somehow we believe that the future is with all of those L1s existing and participating in liquidity

flows. But since we both kind of have liquidity advantage on L1 and also believe in the future where it progresses uh then maybe it's not as important as some people are suggesting. So it would be best to deliver solutions like AIL and strengthen the existing uh somewhere in the middle solutions that uh that are so successful on Ethereum. >> Yeah. Yeah. I think so. One of the things that we've talked about at this conference is how EIL avoids the solver midstate completely. And what I mean by the solver midstate is that when I as the user have this intention and I give it to the solver, the solver can then go

and decide to take a different route or censor me or block my transaction. Whereas with EIL, I don't give that intention to the liquidity provider that is providing the funds for me. So they are not aware of what I'm doing on the destination chain and they don't have my intent. So they cannot censor me. They can't frontr run me or block my transaction. So do you think that this model of kind of avoiding this midstate and should become a a norm in the interop space of of trying to figure out ways to avoid this mid-state dependency. >> Um once again it's it depends on the user expectation. Uh if there was no solution like this it would be disaster.

You want to give uh like whether it's institutional users or or end users you want to give them ability to to execute privately depending like whatever they want to execute between two chains. So it matters. It does matter a lot. And on the other hand, if you establish very good trust relationship with a counterparty and if you're okay with that, um then again we we say that blockchain delivers the trust ambient trust for the ecosystems for the industries or for the jurisdictions regions where there is a lack of trust between the users and institutions. But in the world where there is a lot of

trust uh that very often becomes cheaper than the integrations of blockchain uh and that's where you want to leave the user opportunity to say actually I don't care if someone knows what I'm going to execute but I totally trust that they will maintain the privacy within our circle. uh so so then it's fine but uh both are needed and that's that base the trustlessness the privacy delivered by Ethereum uh is incredibly important and and that's the set of values that we set for ourselves. Yeah, I think I think that's kind of one of the points that we were making in the trust manifesto is how whether you c whether you think you can trust someone or you don't think you can, you still are placing the responsibility in the hands and you're

giving them the opportunity I guess to be able to hurt you or to be able to take a m to take a bad action. I think it's very hard to verify that someone is completely that you can completely trust them. I mean it's actually impossible I would say. But but this is that uh this is that uh difference between the um high trust environments and the low trust environments because in the low trust environment you will say uh I'm giving someone an opportunity to take advantage of me. In the high trust environment I say I'm giving someone an opportunity to deliver additional value to me. Uh and it's it's really like this you know many people are are looking at blockchain in the in the well functioning economies and they say

you're you're so full of paranoia that everyone will try to steal from you and that's just because we keep thinking about all of those sketch cases and bad scenarios and the black swan events. Um but the moment when we start forcing everyone into those solutions that's that's when often we are rejected. I I think that's important for for solving the problems, the real problems and making sure that we allow the world to exist in a in a good UX high trust solutions right my perfect world will be the one where blockchain is not needed right where we have so much trust between people and institutions that actually say well what this is a waste of time this is a waste of e effort that's not the world that we live in and

and that's why what we are building is so important uh but saying that every time I trust someone I give them opportunity to take advantage that's like um maybe for each of us it's easy to understand the the this concept by just thinking about relationships is uh that's that's why we trust friends and family um because we care about it. Yeah, I think we've seen I mean I think the role of blockchain and and one of the reasons I think that you know Ethereum was created is when when you have a centralized banking system you are fundamentally placing your trust in an intermediary and we have seen ways that like banks have taken advantage of that and we have also seen ways like in in crypto that there have been crazy hacks there have been exploits um

people's trust has been broken many many times and so I think it can come off as very adversarial to like frame it as oh like trusting them is giving them an opportunity to like hurt us. But I think that adversarial mindset is true because it has happened in the past and there have been many instances of that and which has led us to create these decentralized and trustless systems because otherwise I would argue that maybe we're just recreating a banking infrastructure. What's the difference? >> But there's yeah there's huge difference between forcing someone into something and giving someone an uh an opportunity like forcing and giving someone an option. Uh so you know saying oh the the banks are evil. I I kind of never thought the

banks in general are evil. They there were many failures and big failures. Some banks are really evil. But also if we look at the like hundreds of years of the financial services from banks and when I was joining the um the blockchain space my first thought was you know I'm I'm coming with lots of experience of the traditional finance and I think that one very very much missing feature of this ecosystems is that for for many years the space will be full of people that have this like lots of hate towards towards traditional finance but there will be not enough people that think that you evolutionary delivered this general improvement and uh and convergence of the traditional finance

and decentralization. I thought that obviously in traditional finance the options for decentralized for trustless spaces were absolutely missing for years and now we have technology that can deliver that uh but rejecting everything that we've built over hundreds of years of the of the financial functions of credit functions of the international financial markets of the international uh like insurance payments al like this enabled so many people to build so many great things and I I think that was also one one big complaint in the past about Ethereum that we almost like rejected the ability to to build together and to make money by delivering the value to others and delivering UX. So, so that's that's that's my way of thinking here.

>> Yeah, I think it's hard because we we have these financial traditional financial institutions, but one of the things that I think about is I think of trust as a pyramid that if you have a trustless base, you can build a trusted solution on top of it. You could build a trusted DAP and that can work great. But if the base itself is trusted, you can't put a trust list and you can't build anything. >> I agree entirely on this one. Yeah, that's that's why we're building that base. Yeah. >> Yeah. Exactly. Cool. Well, on that I think I will end. And um if we have any questions, I think uh Diana is going to come and let us know.

>> Do we have any >> Thank you. Thank you so much. >> You guys covered so much already. All good. We actually have two questions that I picked out. So question number one, uh Thomas, recently the Ethereum Foundation has gone pretty hard on creative and people are liking the storytelling that you do with the addition of the digital team and people telling stories and posting videos. Do you plan on continuing in that direction and what is your vision? Yeah, I mean I think this is uh a lot of effort from the ecode teams and and Josh Stark and Josh Whiteser on communication and PR they they not only deliver the message and response to all the crisis

but they also started doing it in a very high quality way with the the greatest creators uh whether it's Louis or Bing and the way they they speak they deliver emotions uh the way of how they understand what people feel the visuals that they provide that gives so many more people ability to to express something and um and you know it's not only technical but also delivers the the values and emotions and if if foundation cares about values then you cannot just deliver technology you just also talk about about people and people are about art and you don't have to push more for it. It's it's good that you have minimal and if you have minimal with absolutely work-ass top people that is such a

pleasure to look at their work their efforts then then it's great and I think that we should have it we should continue with it. It doesn't mean that we should push more and more of it. >> That was an excellent answer. I am personally very happy because I'm a big big fan of Louis and Benji's and Josh's work and all of that. Marissa, one question for you. You are one of the authors of the Trustless Manifesto. What was the process like? How long did it take to get to the version that we see today so beautifully put together? >> Yeah. Um it was something that we started thinking about because when we were looking at the interop space, we were seeing how many trust assumptions there actually were um in moving funds crosschain and we realized that this was something that uh that we as the

accounting chain abstraction in Vitalic wanted to to make a statement about um and to to say something publicly. Uh so we started with the draft. Um I would say we uh got some input from civil culture society and worked on it for for about a week until it came out in the version that you guys see. But it was really inspired by wanting to create a standard for trustlessness, wanting to let builders know that this is something they need to be thinking about in their designs. And I think it was quite of an aspirational piece. And one piece that I think like comes next is like okay, what are the concrete steps like builders and protocol developers can take to do this?

what are the things they need to check? And so that's something that we're thinking about now um and really want to put going forward. >> Amazing. And again, once again, if you have not read and or signed the Trustless Manifesto, you should do that today. Thank you both so much. Thank you, Thomas. And thank you, Marissa. >> Thank you so much, Marissa. Thank you for organizing.