Visa buys CryptoPunk, Huobi supports Arbitrum & more - The Daily Gwei Refuel #192 - Ethereum Updates

Transcript

hello everyone and welcome to another episode of the daily gray refuel where recap the latest news in the ethereum ecosystem i'm your host anthony sosano and today's the 23rd of august 2021 all right everyone hope you had a good weekend uh if you weren't able to attend the ama on saturday that i did in the discord channel the recording is now uh live for you to kind of view on youtube here so if you're interested in going and checking that out it'll be linked in the youtube description or you can just go to the channel and find it there it was the longest ama i've ever done at 2 hours and 10 minutes i believe and so many good questions i really had a really fun time answering them so definitely go go watch the replay here and if you're interested in kind of like

um you know chatting with the community again this wednesday in the discord channel we're going to have a bit of a i guess you could call it shoot the night yeah um you know just well night for australians and all the details for that are in the discord channel um but essentially that should be fun as well but yeah go check this out if you haven't already uh and hope to see you on on wednesday possibly all right so i think the biggest news from i guess like the last three days was that visa bought a crypto punk now they bought a floor crypto punk which is essentially the most common one uh and they bought it using eth of course because all the crypto punks are kind of like um listed in eth on the site there and they bought it from g-money who is a long-time i guess

like nft collector owns an ape crypto punk i believe um but essentially they they put out this tweet where they said over the last 60 years visa has built a collection of historic commerce artifacts from early paper credit cards to the zip zap machine today as we enter a new era of nft commerce visa welcomes crypto punk number 7610 to our collection now what i really liked about this tweet was that they basically acknowledged that crypto punks are historic commerce artifacts right like that's right that's that's pretty crazy because it's it's basically acknowledging that you know nfts are here to stay they're going to be big in the future and i know you know visa is kind of like funny enough visa is one of these companies that i guess crypto is trying to disrupt right they centralize kind of like financial companies but i

think that's kind of like missing the point i think the point here really is that um this kind of stuff is is i mean the adoption of this kind of stuff is accelerating like much faster than any of us would have you know would have imagined really i think it's quite insane that we already have these like billion dollar publicly traded companies buying nfts to be part of i guess like uh uh their collection essentially which is which is insane so and it wasn't just like this nft that they bought they also put out like a blog post here with an interview um with uh with cue i think that's how how saying aimcue hopefully i didn't get that wrong q sheffield who basically is the crypt as the their crypto nft expert at visa and in this interview he basically licked a lot of

alpha essentially what he was saying was visa is very interested in nfts and they're not just buying a punk for the hell of it to add to their collection they actually want to support the nft ecosystem and the creators within it i mean could you imagine visa leveraging their their really really massive user base uh for like an nft marketplace or something like that that would be quite crazy because obviously you know openc i mean for those who don't know maybe openc has been setting records in kind of like sales volume the nft stuff's gone crazy and really i still think we're at the very beginning here i don't i really don't think that um we're anywhere near kind of like any sort of top in terms of adoption or whatever um so yeah visa sees the the writing on the world is getting involved

really early and you know in in this kind of like interview uh they basically say that you know this is just the beginning of our work in this space and they really want to uh you know kind of like i guess usher or i guess like push this space forward in any way that they can uh and this and then buying crypto punk is just one kind of like part of that which i thought was really cool and as i mentioned before they bought it using eth and you know eat this money we've been saying that for quite a while now obviously punks are on the ethereum network as well um and i think you know i think this is the first publicly traded company to own a punk i actually know it's the first publicly traded company to own a punk at least publicly

um and i think it's maybe one of the first if not the first to own an nft which is quite crazy when you think about it right like i mean there might be other kind of publicly traded funds and things like that that that kind of i guess own nfts as part of some i guess uh fund that they have or whatever but in terms of like uh something like visa or i guess like one of these big public companies um you know then buying punks and nft and nft in general is is i think a first and again i think this sends a signal to the rest of the i guess the world really uh that you know nfts are here to stay there something that should be taken seriously and visas just lending legitimacy to and and on the refuel i think i talk about legitimacy a lot

right like how i think i mean vitalik wrote a blog post about this called the most scarce resource is legitimacy and i think that's correct because especially within the nft space uh legitimacy is what drives a lot of the kind of i guess rarity at the end of the day like if a group of people think that something is legitimate then you know i guess like it's like a snowball effect from there it builds network effects you know the perfect example of this is what happened with pudgy penguins where uh basically a group of people kind of i guess started talking about on twitter and they recruited more and more people to the community more and more people bought these kind of like penguins and what ended up happening was that their pudgy penguins gained legitimacy and there's there's tons of these other projects that haven't got any legitimacy

these profile picture projects um and you know they aren't really worth anything whereas pudgy penguins bought eight your op app clubs another example obviously crypto punks there's a few of these out there they're the ones that gain the social legitimacy and you know depending on who's giving them this legitimacy it also holds more weight right like someone like visa or it gets like a company like visa giving crypto punks legitimacy is is a massive signal whereas a tiny little maybe corner store giving crypto like owning a punk uh wouldn't be like a huge deal right because there's different obviously different levels of legitimacy there this is kind of like similar to what i was saying i guess a few months ago about cbdc's and how central banks are looking to to kind of like i guess create these cbdc's is basically sending a signal to the rest of the world that

you know they think that crypto is here to stay and it's a legitimate thing but obviously they want to you know issue their own currency and control it in their own sort of way but that's still kind of like that legitimacy the legitimacy that flows through there which i think is really really cool uh i put out a kind of tweet here as well saying i just wanted to make it crystal clear that visa used ether's money to buy crypto punk if you had told me that they were going to do this even like i mean even even only a couple of months ago if you told me this was going to happen i would have been you know you're crazy it's too early a couple years ago since i've been chanting that atheist money i would have said no no way in hell right like it's just amazing

how fast this ecosystem has kind of evolved here and then i wanted to say you don't have enough eighth or nfts i mean i'm already like obviously a lot a long-term bull hyper bullish always even when we tanked 60 the other the other month i was still really really bullish but i guess looking at the the price movement that we've seen over the weekend especially and how we seem to be kind of like i guess you know crabbing around this range of like 3 000 to 3 300 but it certainly feels like the energy is there for us to go back to all-time highs sooner rather than later and not just i guess like eighth going back to all-time high but basically all these nfts basically seeing extremely um uh i guess like quick adoption like quicker than any of us can anticipate and also i think d5 as

well is obviously um you know still still there it's it's obviously quite a lot quieter these days but it's still there and it's still growing and it's just i mean as soon as i saw this today i was like how can i possibly ever be bearish like maybe one day far into the future when this stuff's been adopted uh and he's like ubiquitous and it powers the entire financial kind of a system but you know while we're in this still early adopter phase i just i find it impossible to be bearish and people say okay well the market doesn't care what you think you know it works in cycles blah blah but it's not really about that for me like i've always said that i think the super cycle is more like an adoption super cycle rather than just a price super cycle the price can do

whatever like in the short term it can remain bearish while long-term fundamentals get much stronger but i think that as as we keep going through these adoption phases just more and more people see this and they're like okay well you know why would i sell uh you know my you know my ticket on this rocket ship that's basically going to change the world and you have more and more of those people kind of thinking like that and then that's why you get like such reflexivity within within crypto so yeah those are just some of my thoughts on that one a dc investor put out a tweet before the um the visa news came out it was i think it was like maybe a few hours before uh what's that 7 38 a.m to what i'm recording that's about 15 hours before um and he said i didn't see it a

year ago but i can see it very clearly now nfts will cement eats dominant that's it that's the tweet um and you know this is i guess goes back to what i was saying about like eighth being money but aithi is also i guess like the the cultural asset of of this revolution within nfts um and like it is the asset at the center of this like nfts don't have to be priced in eth but they still are like stable coins aren't exactly a small thing they're huge and i think i explained on the ama that i believe that there are a big reason why uh nfts uh are priced in eighth or maybe on the refuel last week i explained this but i i i did explain that i think it's because it's just simpler right because you have to pay gas fees uh in

eighth and you know just having eight is just much easier to transact with with in your wallet and things like that but the funny thing is is that um when i think about this uh i don't know how many people realize that every like at least in the u.s uh some parts of europe definitely in australia i don't think many people realize that if you trade eth for an nft that's a capital gains events you have to record capital gains tax against that against the gain that you made on that eighth and then if you trade that nft back to ethan you know you uh you lose money in in fiat not in eight you can't measure it in eight you have to measure it in usd or aud whatever you have to basically uh that's another capital gain event or loss events uh depending if you made

money or lost money there uh so maybe over time we will just start seeing it kind of priced in stable coins because of the tax effects there um but still it's quite amazing to me that not only are they kind of i guess priced in in eighth where people use ethers like that medium of exchange and that kind of like currency but they're also valued in eth right where the punk floor like when i talk to my friends about the punk floor i think it's like 64 eth now we we say eat we don't really say kind of like the dollar amount um and that you know we've bought 220 000 u.s dollars right now but really people are wanting to stack eighth and because you want to stack eif you may be trading in and out of nfts and measuring it in each because if you put you know three

eighth into an nft or whatever and then you come out with five eighth well obviously that's that's better for you even if it wasn't like a fiat game maybe the 8th price went down during that time you still made more eighth because a lot of the people i know at least that are you know i guess like playing the nft game investing in it they're definitely using them as a vehicle to stack more eighth and and you know as we continue on down the path of eth being continuing to become this like extremely valuable financial asset that everyone wants to own that's how mormon people are going to think i mean that's how i think about things like pretty much like all of the things that i invest in i measure them against eight like if i'm not outperforming eight in what i buy there is literally no reason for me to

have have held it and and depending on the asset i need to be out performing eighth by a lot like i've spoken about with d5 before how i think that if i'm buying into a kind of like a d5 asset i really need to be sure that that's going to kind of like outperform eth by at least a 3x like that's how i kind of view it um i'm not just settling for a 2x i need at least a 3x and ideally like a 5x because the amount amount of extra risk you take on is is quite large and i think that's the same with nfts but nfts can be very reflexive in either direction like you can literally make 5x on your eighth in like a day if you pick the right project right it's just it's really crazy so yeah but but it's gonna be interesting

to see over time if nfts continue to be priced in eighth uh as a dominant kind of like currency um or if they kind of like change over to stable coins and but still get valued in eighth where people still say okay well you know i only want to price these things in eat or value them in eighth because i don't really care to stack extra stable coins or stack extra fear i want to stack extra e so that's going to be very interesting to see but anyway extremely bullish news out of visa i read a little bit more about this in the delegate newsletter today so definitely go check that out if you haven't already but i'm gonna move on to i think the next biggest piece of news was that coinbase have uh given an update on usdc so emily choi the president and ceo of coinbase put out

this tweet thread uh basically saying starting september of this year 2021 usdc reserves will be held in cash and short duration u.s government treasuries this is the approach we want for usdc reserves now this comes after a bit of controversy that usdc it was revealed that i think a few weeks ago that usdc wasn't actually backed by cash and and kind of like a government treasury bonds it was backed by an uh i guess like a bunch of different assets some of them pretty risky as well so i think like only 50 or 60 percent were backed by cash and and uh and and these government kind of like treasury bonds and things like that which made holding usdc riskier than it was perceived before and what i actually really appreciated from emily here was that uh she basically said that um where

was it uh i think they said that uh yeah so when when circles shared their may report about usdc reserves in late july which included a more diversified pool of investments for the first time we should have moved faster to update statements like that on our website and the statement that she's talking about was them saying that usdc is backed by a dollar in a bank account when it really isn't but starting on september they're just going to be using kind of like cash which is usd in a bank account and government treasury bonds which are pretty much like the safest investment that you can hold right like the safest kind of like asset you can hold outside of i guess uh i guess fear in terms of um in terms of it being stable and and i guess like a bunch of other kind of like

things lost along the risk spectrum there so yeah usdc i guess like starting september we'll be back to i guess what people thought it was before like this safe kind of like i mean it's centralized of course but like this safe centralized stablecoin that you could use and it's regulated it's transparent it's it's not like something like tether which people obviously have have lots and lots of big issues with but yeah i think that it's really cool that emily put this sweet thread out but then she also acknowledged that they could have done better to correct that language to kind of like avoid the confusion which i'm hoping they do so in the future so really cool to see that so uh cairo not here posted a uh image of um a dune analytics dashboard here that tracks uh aip1559 so eip1559 style transaction dominance

is now at 50 which is really really cool i mean as i mentioned last week on last week's refuel metamask started rolling out one five five nine support to pretty much everyone uh that was using their kind of like browser exchange extension and mobile wallet and that's had a dramatic effect here right you can see from about i guess like august 18th i think that's when they started rolling it out uh the one five five nine transaction adoption has been has been kind of like uh picking up a lot there and now we're at fifty percent i think you know we can probably we can probably get to seventy eighty percent quite quickly but that last 20 is probably going to take a little while because that also includes things like exchanges right all the exchanges having to enable this all the wallets within the ecosystem whether they be you know

large or small they're gonna have to up update their kind of like clients and get people using these one five five nine style transactions so i think seventy to eighty percent will come quite quickly but but the yeah that finals like 20 or 30 might take a little while there but that's okay i think i've been seeing people talk about one five five nine recently outside of the feed burn and kind of say okay did we really improve the the fee market and i think it's funny because there's a bit of a trade-off here what we did with what with 1559 is that we smoothed out the transaction prices right like you'll see that whenever there's like some kind of a crazy nft drop the gas will spike for maybe like maybe not even 10 minutes or something like that the gas prices might even go to 1000 gray but they'll quickly

correct because that's just the mechanism that 1559 has in built into it where it actually self corrects a lot quicker because of that dynamic transaction uh fee pricing there but on top of that i think uh we have like a trade-off and and that trade-off is the fact that you know how you used to basically wait until like the quietest period of the week to essentially get your transactions in well that doesn't really exist these days there are certainly periods of time during the week where transaction fees are lower than they will be uh you know in other period in other periods of time like the more active periods but it's not as a dramatic of a fall-off as it was before because before you could essentially have like say 50 or 60 ways being the normal average price during the week and then on the weekend particularly a

sunday at a certain time you could even get transactions in between between 10 and 20 grey because there just wouldn't be that much activity on the network but due to 1559 there may be a dip from that 50 60 way but it won't be as dramatic as it will will have seen in the past which i think is an okay trade-off right because it means on average most users across the network the ones who who kind of like you know don't want to wait for for the weekend to do their transaction and things like that they definitely get to feel more included and get to kind of like save money on fees here and if you use one five five nine style transactions you also get a refund so you're not overpaying too which i think is really really cool so yeah great to see the 50 adoption number here

finally um you know i'm hoping to see this continue to to grow as well so uh loopring put out a teaser over the weekend saying they've got some big news with more details coming this week and basically they have a video here that just basic basically says layer 2 nfts so yeah they're going to be adding nft support to their zk roll up layer 2 which i think is going to be really cool i've talked about loop ring plenty of times on the refuel before they've got an entire layer 2 ecosystem running right now right from their exchanges like the amm and the autobook exchanges to their smart wallet and things like that uh they have a lot of stuff going on there like their payments protocol too and they're still here i know i haven't talked spoken about looper in a little while but they're still here they're

still growing they're still basically powering uh i guess like the l2 revolution here which i think is really really awesome and you know i mean there's obviously not just loot bring but a bunch of other kind of like l2s uh are kind of like upgrading their systems coming to life i mean arbitrary here announced that hobby is going to be supporting them direct deposits and withdrawals on albertum 1 which is supposed to go live you know i guess by the end of this month or you know this month um you know it's funny because like are they going to push it to the end of the month are they going to like literally do it on the last day i don't know but it's going to be interesting to see what happens with with albatroom but as i've said in the past they haven't missed a kind of like

i guess release window before so i'm you know super excited for them to go live with their uh i guess like public mainnet and the fact that they're going to have hobby as a centralized exchange supporting direct deposits and withdrawal withdrawals is going to really uh you know i think be a really positive thing for arbitrary 1 because that's going to be a way for lots of users to quickly get into this layer 2 ecosystem and experience what a layer two on ethereum is like so really really excited for that of course and hobby isn't the only exchange there's i think okay x and okay coin are also supporting albatroom i do wonder if exchanges like uh coinbase um you know and kraken and all that will support them i think binance and ftx might be a bit slower obviously binance because they have a vested interest to support

just bsc and ftx is obviously very close to the solana ecosystem so it's going to be interesting to see if they enable those kind of like deposits and withdraw their withdrawals there but if not there's still other ways to get in which i think is really really cool and you can obviously get into arbitrary one from layer one ethereum as well uh provided you pay the gas fees of course and things like that all right so glass up put out an update or glass protocol put an update over the weekend basically reintroducing themselves now i've spoken about glass before it's basically this kind of like web 3 video platform they call it video owned by the people uh instead of the platform and basically in this post they i guess like they go through the the design philosophy how they imagine kind of like the the uh i

guess like uh decentralized video space kind of evolving how they kind of place themselves in that through this master plan they've got here on the infrastructure side the creator monetization and the recommenders and moderation i i think i've spoken about moderation a lot in terms of the web 3 world before because obviously moderation is a i guess like a a big concern because there's a lot of content that gets posted online that are usually moderated away by essential identity but how do you do moderation in a decentralized world especially on the video front so i think that you know in this post they detail that and they kind of like give some history and things like that and how the i guess web 2 world works and and handles this so you can definitely check out uh the kind of like youtube description for a link to this but i

thought this was really cool because i'm actually uh planning to hopefully use glass and maybe kind of like mirror upload the videos you know to youtube and to glass and kind of like see how that platform goes there uh because i really do want to see web3 uh this kind of like decentralized um uh kind of like uh uh decentralized social media and centralized video streaming all that sort of stuff really come to life and take off because that is like the next frontier for this technology right we have had d5 we've had like um uh nfts we've had dowels that's still all growing and stuff like that like social tokens all that sort of stuff but i really want to see an amazing you know long-lived kind of like truly decentralized attempt at the web 3 stack and you know i've spoken about rv

building decentralized social media before the decentralized twitter glass is doing decentralized um video uh the platform that they posted this on mirai is doing decentralized content publishing and and basically giving power back to the creators to kind of monetize instead of giving all the power to uh the platform themselves and all the kind of like money to the platform themselves so yeah this is going to be really cool to see how that plays out uh definitely go check out this blog post i'll link it in the youtube description so the head of gaming at youtube put out a tweet over the weekend saying i'm really bullish oh sorry i'm bullish on nfts and then he continues with i believe play to earn is the next major gaming model as well as an open market for in-game digital items most in-game assets are a liquid which is insane to

me all of this will change long-term through blockchain and fts it's self-evident i mean yes it is and i and i think i've spoken about this before where i basically said axi infinity has shown the world how powerful play to earn games are blockchain games are nfts are it's just one game making a lot of revenue uh you know they're worth billions of dollars their token and everything like that and this is just the very very beginning i know i i think i've mentioned it before where i know plenty of aaa studios from what i've heard are now kind of like diving deep into this stuff trying to understand it trying to see how they can get involved and things like that uh it's just i mean really the fact that the head of gaming at youtube

is saying this is again another kind of like signal of legitimacy you know i was talking about that with the visa news the head of gaming at youtube saying that nfts are kind of like revolutionary and it's gonna and kind of like play to earn models uh the next major is the next major gaming model is much more effective than just like you know a random person saying even like someone even even me saying it like it's much more effective than me just telling you because this is social signaling this is social legitimacy and youtube is obviously absolutely massive and now i i spoke you know before i spoke about i sorry just before i spoke about glass and how they're decentralizing video content video publishing and you know how i'm really bullish on that but generally there's going to be still kind of like these centralized players for a

very long time so if we can act as a forcing function like our ecosystem act as a forcing function for these centralized companies to basically adopt this technology we can force them to innovate and we can make this uh make the adoption curve i guess a lot quicker than having to wait for these companies to kind of realize what they've been missing out on and i think that crypto really does that it accelerates all of this adoption and it's going to be absolutely wild to see how youtube handles this i mean they don't even have to kind of like do anything nft specific they can essentially just just enable crypto payments for for even just gamers as a trial right they basically have like a tip button use maybe an ethereum l2 or something like that for tipping or or whatever and you know get users to load their wallet

with a direct fiat on ramp you know just like similar to what reddit is doing in the community point system where they have like they're building on arbitrom and they're going to have community points trading on there and be people being able to send it to each other and all that sort of stuff the possibility possibilities are endless here and i'm sure you know all youtube all these other companies and all these kind of game companies are cooking up things in the behind the scenes and we're gonna just keep hearing more and more about this as as time goes on so speaking of l2s uh brendan from dharma announced today that they're adding polygon support uh probably the polygon pos chain in beta to their app so you can basically go from usd real fiat dollars to eighth on dharma um and and it's about to get better be

better pricing than coinbase because you can go directly to polygon which uh polygons pos chain which has uh kind of like obviously cheaper fees than um uh then ethereum's mainnet right which i think is really really cool and they're gonna be supporting other l2s as well i mean you can see here when a real uh when a real l2 like optimism albatroom um next uh dm so yeah i guess like um this is just like logical for dharma to to uh i guess be the fiat on rammed into these l2s uh and into these scalability solutions obviously the polygon pos chain is not like a true l2 um but it's still an ethereum scalability solution and i've said before plenty of i think i've said it plenty of times where i believe that phase fiat on ramps are going to be the thing that bring kind of

like mass adoption to these scalability solutions especially to l2s and things like that and it's going to get more and more people involved without having to go through the layer one ethereum chain and incur those higher fees on there so yeah really really cool to see this from dharma all right so for those of you who missed this you may have missed this over the weekend uh there was a bit of turbulence on the beacon chain where about four percent of validators were not attesting to blocks and that kind of cause i guess a little bit of instability here uh ben edgington has a really really great tweet thread explaining exactly what happened but the trdr is that one of uh the bigger staking providers uh had i guess like um a a a bit of an issue with their kind of like nodes or their validators and these

validators kind of i guess weren't attesting to blocks correctly and blocks were getting orphaned and missed and all that sort of stuff and then you know he kind of goes on to say that uh there may need to be a little bit of changes in the beacon chain to be less sensitive to this sort of stuff because i think that um the way it currently is isn't ideal but this uh this was really really cool and and uh you know i i think that uh the fact that we get like really quick kind of i guess post-mortems for this sort of stuff from from the core devs and researchers is the really special thing about the ethereum ecosystem where essentially we don't say oh my god okay well you know this happened and kick and scream and complain about it and then a few weeks time we'll hear about it we

hear about these things really really fast like if you remember there was an issue with the prism client a few months ago prayer labs the prolapse team the one that makes the prism client uh had a postmortem up within a couple days and was extremely detailed so i just i feel really blessed that we have these uh researchers and and engineers within the eth2 ecosystem that are so dedicated to their their craft that they're happy to put out like this public information and they're not hiding anything either like obviously some of this stuff can be kind of twisted in a way to spread fud about ethereum saying oh look ethereum had an issue whatever blah blah but really this is just the openness of our ecosystem and and we don't care if this gets twisted or whatever people can say whatever they want to say we'd rather

get the truth out there we'd rather improve as an ecosystem than kind of like stay kind of i guess like quiet about this and and sweep it under the rug which i really thought was was was really which i think is really cool um and you can go check out this thread it'll be linked in the youtube description but i think on that note i'm gonna leave you for today so thank you everyone for listening and watching be sure to subscribe to the channel if you haven't yet give that video a thumbs up subscribe to the newsletter join the discord channel and i'll catch you all tomorrow thanks everyone