ZKPodcast: Mapping the Polkadot Ecosystem

Transcript

[Music] welcome to xero knowledge i'm your host anna rose in this podcast we will be exploring the latest in zero knowledge research and the decentralized web as well as new paradigms that promise to change the way we interact and transact online this week i chat with fabi from parity derek from moonbeam retail from akala and lucas from centrifuge this is a multi-interview episode all about the polkadot ecosystem i felt it made sense to get a number of perspectives to really paint the picture

of what this ecosystem looks like especially now given that the much anticipated parachain component is about to come online a quick primer for folks new to the polka dot project polkadot consists of a relay chain which acts kind of like a hub with a number of other blockchains that are connected up to it the relay chain is where the blockchain consensus happens the connected blockchains are called parachains and this connection between the relay chain and the pair chain is the component that is about to be enabled in this episode we talk to the teams who will be working within this new architecture but before i kick off i want to tell you a little bit about the zk validator it's a project that i co-founded over a year ago and i've mentioned it a couple times on the show

the zkv is currently active on cosmos near polkadot and kusama we will soon also be active on mina and as a validator the zkv is quite unique we have a very clear mandate and a singular focus that is the advocacy and promotion of privacy and zero knowledge topics on the networks that we validate on we do this through connecting the zk community with the folks working on the network we also run workshops we put together blog posts and reports and we're also starting to do a little bit of funding into early stage projects that line up with the zkv mandate what also might be interesting for you is we're launching a series of dedicated events focused on privacy on these different networks for example we just recently

held a near privacy roundtable there's an upcoming cosmos privacy and zkp showcase happening on march 26th and we're in the early planning phase for a polkadot event the details are still in the works but we're aiming for late april or early may we hope to bring together the zk community as well as new privacy projects that are emerging on the network if you think your project falls into that category and you want to participate please email us at events at zkvalidator.com you'll also be hearing more about this through the polkadot channels but do follow at zkvalidator on twitter to stay in the loop about all of our events now if you want to support the xero knowledge validators

initiative there's a very easy way to do so as mentioned the xero knowledge validator is running on a number of pos networks if you happen to be a token holder on any of those networks you can always stake to us and since we're talking about polka dot in this episode i do want to highlight that we have five validator nodes there find us in the polka dot dot js ui and do add all five nodes this is a pretty cool passive way to support the zero knowledge validator initiative and by extension the development of zero knowledge proof and privacy tech on polka dot now that we've got this covered here is my deep dive into the polka dot ecosystem [Music] in this week's episode i speak with four members of the polka dot ecosystem

fabi from parity derek from moonbeam retail from akala and lucas from centrifuge my goal is to understand what projects are doing in the ecosystem and kind of what it means to be part of it especially now on the eve of pair chains being deployed now i've done a few episodes in the past on polka dot what it is how it's built we talked about the kusama network as well in an earlier episode so i'm going to add all of those in the show notes but today i want to kind of figure out a little bit more what's actually going on in polka dot so first off i want to welcome fabi back to the show hey fabi yeah so fabi and i used to work together many years ago when i was still at parity

and actually fabi you were on one of the very early episodes of the podcast i think this was like end of 2017 i believe it's episode five something like catching up with a few peeps from parody it was recorded like on a retreat like in this cabin in brandenburg and it was very it was a very very long time ago so i think it's worth it to share with the audience what you do at parity obviously that's evolved since that episode five but yeah what what do you do at parity today yeah for sure i mean the polka dot and parody as well as this podcast i think has come a long way in the meantime uh so i'm glad i have another opportunity here yeah so i joined parity like four or

five years ago uh when when i joined was really just a handful of of sweaty developers in the broken leaving room and uh primarily focused on on ethereum back then uh so we built core infrastructure and tools for for the ethereum ecosystem primarily the parity ethereum now open ethereum client so that was that was like kind of like the beginning of of my journey with parity was uh primarily focused on that um starting like mid 2017 or so and i think it's also where me we met things became a little bit clearer around polka dots so the poker paper was already there like from like end of 2016 onwards but like the really like full force polka dot war really started like

mid-2017 and that's when i was there and that was during the time of the fundraise basically that early early polka dot period yeah that's right that's right so that was like the time when suddenly the war polka dot was like slowly being used more often than the world uh world ethereum within parity um yeah and since then has been a like a yeah a pretty wild journey ups and down sides a few hacks through hacks yeah uh bear markets bear markets bull markets uh nfts and icos and and d5 and all of that but yeah pretty focused on just building what was written in the white paper plus a lot of extras on the way so things like kusama

which you said you had a whole episode with nicole on but also things like substrate weren't they're not mentioned in the polka dot paper right those are all things we kind of like discovered on the way that would be neat to have so while the white paper is kind of like the guiding document right in terms of what we're set out to do there's actually a lot of more stuff that we've built on the way when you first joined parity how many people were there just over 10. wow you're like you're like employee number 11 or number 12 or something something like that i mean there's a few people that have left since then so if you look at like most long-standing employees it's probably actually higher up the list but yeah um there weren't all all that

many people but yeah we went through incredible growth since then or like around 150 now wow this is a completely different entity then yeah it's not much to do with uh from a like high level organizational point of view with what it was back then but i think actually in terms of what we're doing it's the same thing just a larger machinery and more smart people behind it but it's it's still at its core we're still doing the same thing so what are you doing exactly at parity what's your role today so i look after what we call ecosystem development it's a little bit of an umbrella term maybe we have to rename that at some point in the future but it's

kind of like what you would traditionally associate with ecosystem developments like growing the ecosystem supporting the ecosystem thinking about what kind of stakeholders do you need on polka dot but it's also things like developer relations it's our enterprise business it's our localization strategy so there's a bunch more things that we kind of like bundle into into that that i'm ultimately looking after and how would you describe sort of maybe this ecosystem and yeah the community that you that you interact with a lot like maybe say a little bit about what it used to be like and what it looks like today yeah it's actually interesting because the polka dot ecosystem is given that parody already had a name

when we really started talking about polka dot there was always a bit of a polka dot i wouldn't call it an ecosystem but a community they were already like people who thought it was cool what we're doing there were already people who like would come to meetups and at least hear out what the vision is kind of thing but like an ecosystem that started to emerge was really only possible when there was something to something tangible some codes to build some stuff with and that started beginning of 2019 roughly with the first releases of substrate and us actually going out in the world and like doing workshops with people and starting to do hackathons and you know getting learning materials out there doing live demos on stages and so on

like that was really a time where you know developers started to get interested and started to use it we got the first feedback and then from there on like an ecosystem emerged i think people who listen to this podcast for a long time are familiar with substrate but maybe you should define it for listeners kind of just catching this episode for the first time what is that what what does that have to do with polka dot yeah so polka dots uh there's many ways to describe it i think but i would i would classify it as like a meta infrastructure layer for layer ones right so for layer one blockchains uh that can plug into this meta infrastructure and get like finality as a service like security

and interoperability through that now the question you quickly ask yourself is like okay now i have this great meta infrastructure that these blockchains can plug into where are the blockchains right like you better make it really easy to build blockchains that can actually plug into this right so somebody's right by meta infrastructure here you're talking about the existing polka dot and the relay chain i guess exactly yeah yeah like if i talk specifically about the relay chain as functionality it's kind of like this if you think about ethereum one being infrastructure for dapps right then the relay chain is kind of like a meta infrastructure for for something like ethereum one oh i see okay interesting but substrate is not that substrate is like as i've always

understood kind of how we've talked about it on the show it's more like a it's the builder or it's like the thing that you can use to build any blockchain yeah it's essentially a set of tools and libraries that you can use to build blockchains and if you connect these blockchains to polkadot we call them parachains and parachains is kind of what everybody's waiting for right this is the update we call it an update is an upgrade what is it it's a the last stage of a phased rollout that's what i would call it yeah um exactly so this is what this is the hot topic is what everyone's waiting on uh we went we started the polkadot rollout spring last year and we went through different phases and we're really not in

the very last stage where we everyone is just waiting for this power chain functionality which is really crucial because so far polka dot is primarily like a a skeleton chain that just validates and governs itself but you cannot actually deploy any additional logic on top of it parrot chains will enable that right power chains are kind of like it's flipping the switch from like this this skeleton thing to like an actual open developer platform and deploy power chains on on top of and then potentially applications on top of these parrot chains um and then we can actually use all of the tools that we've been building over the last years to to deploy stuff so yeah this is it's the last milestone but it's also the most important one in in many ways

cool maybe for the listeners who aren't familiar with parachains and how they actually relate to the relay chain what is that connection point for for people who are familiar with like if you have an ethereum 2 i think a a good way to understand it although there are many many nuances to that but on a high level is ultimately pocono is also a shorted blockchain protocol but with the key difference compared to ethereum two that instead of each chart being like an ethereum execution environment and each chart looking exactly the same these shards can look vastly different right it could be like a bitcoin like chain utxo chain it could be an ethereum like small contract platform

uh it could be a completely application specific chain like one chain one application kind of thing uh so you have significantly more technical freedom in like actually going into uh this chain and changing it to whatever you need um and then there's a like an economic mechanism on how these uh spots are allocated right let's say eth2 just launches with like that those are the shards right that's the capabilities uh please deploy on top of them polka dot is a little bit more uh you know here's this meta infrastructure you can actually now start deploying these charts and there's like an economic game on like how they're allocated and so in this case though each shard is it's a unique blockchain actually it's not an identical data

structure that's right that being said they could also be identical right if you want to deploy twice the same thing polkadot doesn't care about that like yet let's say you want to horizontally scale your chain let's you know you could deploy the same thing again but yeah obviously the idea always behind parrot chains is optimization and uh you can optimize for a lot of different things maybe you optimize for a specific for specific application or for specific industry or for specific problem domain let's say privacy or scalability you know whatever it is but it's it's the power of polka dot and power substrate really comes through when you think about what am i optimizing for and how how can i customize my infrastructure to accommodate for that use case so

let's think about like i i want to kind of imagine like on launch like as mentioned there's going to be kind of the last building block pair chains are going to be enabled like there already exists some fully formed projects we actually are going to be interviewing three after this but like some are fully formed and are actually live and some are waiting for pair of chains but like do you expect that like you turn this on and day one you have 100 new pair chains like how is that gonna actually work yeah yeah so there's there's gonna be some allocation uh mechanism that i alluded to but essentially it's a gradual scale up right there's we well first of all we don't have some

confidence in that the thing that we've built actually works right so we don't just want to like let everyone jump in and then hope it doesn't break but rather like gradually roll it out but there's also like reasons like economic reasons and stuff like that why you kind of like gradually want to allocate this stuff also as the ecosystem grows um but yeah so you can imagine it will look something like you know like one one slot that becomes available per week so like over the course of two years right you would you could roll out like a hundred pair of chains but like at any given time right there's going to be some uh slot allocation mechanism going on so if people are interested in getting a slot they can uh they can start playing these games do you know how many are gonna be offered

right off the bat though like i don't imagine it's gonna be one at a time right off the bat like is there gonna be like 10 slots and then you add one every yes well i think those are still decisions that need to be made like it's essentially parametrization within the protocol but as i said it's going to be gradual um and it's likely you know it's it's first going to be on some test nets that's already the case we have pair chains on like non-value bearing test nets and you know people are using cross-chain messages and all like all that stuff already exists but the next step would be to bring it on kusama and maybe already through like the auctioning process but maybe also through like a governance world like different mechanisms on how you can actually bring chains on so we will do

that like gradually and as we feel comfortable as things are tested and audited and optimized and all of that but on polka dot right like once you pull the trigger and say like okay now um you know programmatically these slots are being allocated then i don't want to say there's no no way back there's always a way back right so you could you could halt it or whatever if the community decides so but ultimately once you do that you want to have confidence in you know this thing is going now so there's going to be a lot of steps before that where we dry things out and have dry runs and do things in either environments where there's no economic value or at least significantly less economic value than on poke.mainnet i mean it's extremely exciting but i'm

curious like how many groups are there in the ecosystem like how many teams or even would even be able to take one of these pair chain slots yeah so right now we have and this is like we do track it internally like parody internally quite diligently to know who's there what are people building and and stuff like that but it's it's ever-changing and with a very increasingly fast pace right so it's it's sometimes a little bit hard to like fully stay on top of it but roughly 300 teams right and we start counting as a team if we say you know at least two people a product idea and some funding behind it so this is not those aren't like parody internal

projects or you know tinkerers or weekend projects or a hackathon i mean there needs to be if it's just two guys having tried something for two weeks that it doesn't count to that number right but those 300 projects aren't they aren't all building parrot chains right so like if you yeah so a good way to categorize uh things and one we often use is kind of like in three bigger buckets one being parachains so teams actually using substrate to build chains that then will be deployed as pair chains on polka dot the second category is higher level applications so those are teams that build for example smart contract applications that are deployed on top of these parrot

chains right so you can imagine a lot of these power chains are platform themselves so maybe there are you know evm platforms or or or you know rust based smart contract platforms and so there's obviously a lot of teams that aren't actually building power chains they're building applications in the polkadot ecosystem that's it kind of like one layer on top of that in the in the tech stack and the third one is what i would call like slash tooling slash infrastructure builders so those are all the people that aren't actually deploying any business logic on top of polka dot at all but they're contributing code in the sense of that they're making it easier or more powerful or faster or whatever to to do stuff in a polka dot ecosystem so

developer tooling like node infrastructure that kind of stuff would fall into the category would something like a wallet or a block explorer fall into that category yeah both both of those would be yeah classical examples of kind of the component builders cool how are you finding these teams like where do they come from do you source them do you like 300 seems like a lot to source how do these teams emerge yeah so i mean right now they just emerge right like right now there isn't uh you don't have to do much right now there's a lot of like influx and for us it's it's also a lot just like even you know being able to handle that in terms of like who wants stuff from us what kind of feedback we're getting and

so on um at the very beginning it was quite helpful to have a name in the ethereum space and the theme space you know happened to be and still is right the place where most of like the decentralized application builders are so us having had a brand in that and the network in that was really helpful so we could just go out and be like hey we've built all this cool stuff for ethereum we've built a new thing it's called substrate maybe you want to try it out right so like we naturally had quite a few people that were following what we're doing that were willing to jump into that and because we knew what kind of limitations ethereum brought because we were the guys that were building building infrastructure there we also knew what are the pain points of these people right so there was a lot of

empathy in in kind of like in our development process uh from like what kind of pain points they have um so at the beginning it was a lot from there and like working very dedicatedly with like these like early pioneers that are willing to uh go on to our platform but yeah ever since i did like beginning of last year yeah it's it's really a flying wheel so like yeah that was actually a question because like if you say 300 that's pretty wild because i feel like the last time i checked in on this it was like 100 so it must be a lot of new projects that have just emerged in like the last few months yeah for sure um like we are profiting um i think as a whole space right from like an upwards

cycle like narrative around bitcoin that's kind of like trickling down into the rest of the industry but also narratives around d5 and now nfts and so on like you have representations of all of that in the polka dot ecosystem right so one is like yeah we're coming out of the gate with this new attack and it's exciting and it solves people's problems and then later on top of that there's also just more people coming into space right and also more people coming into space that have less of a mental lock in on like you know there's bitcoin and their theme smart contracts but there's maybe also other ways to do things right so for us it's you know it's a function of us doing good job i think but it's also a function of like you know there's just being a lot of

excitement or a lot of new people coming into space and actually speaking of new projects i mean as part of the xeronauts validator we actually did a workshop with the parity folks back in the summer this past summer 2020 and um we were looking for privacy projects on polka dot and there was a handful of privacy projects but there was very few zero knowledge proof related projects there was some there was kind of more of a focus on trusted execution environments when we were looking at it back then but since then i mean we've been tracking it as well and we've seen an explosion of new zero knowledge or privacy related projects like given that this is the zero knowledge podcast and a lot of our listeners are concerned with this or interested in this topic like

what would you say if somebody has a zero knowledge focus how do they even kind of start to interact in the ecosystem like obviously it's awesome to see that there are projects that are doing that but like are there still building blocks missing like how would how would we maybe even as the zero validator help focus that energy yeah i mean there's lots of lots of ways to to get involved and uh you know because it is so fast moving and you know ever expanding uh kind of dynamics it's sometimes also a bit overwhelming right like you go and it's like oh there's all these teams and there's all this tech and like where should i start a good way is starting to talk to people that are in the ecosystem right start

talk to parody talk to the web 3 foundation maybe talk to folks who are already doing xero knowledge stuff in the ecosystem they usually have a pretty good understanding of what's going on and what's missing right at parity specifically we're like in this concept mode of like looking what's missing in the ecosystem and what of that should be built by us versus what should be built by others right and yeah we're never in the business of competing with our own ecosystem we always just look at like hey is no one picking this up okay then you know let's do it ourselves kind of thing but there are there's pretty great like support infrastructure that you can plug into that you really get for free right so the grants program that the web3 foundation is running is a great source of just non-diluted funding

if you want to get started um there's also always a list of like general like areas of interest i would say sometimes there are even precise rfps of things that we would like to see that you can pick up so that's one way uh the other one is the poco treasury it's essentially this on chain dao that sits on top of polka dot and it's a pretty powerful capital deployment mechanism for for ecosystem participants and again a great way to get just non-dilutive dots into your hands to get started um that's kind of like governed by by the by the community and the third one is stuff that we are running at parity so we specifically want to point out the builders program but there's actually

more waste in the act with us they can kind of go beyond that but they're all centered around technical support support around architecture like helping people to actually find the right thing to to build and um and then find the right way to actually go about it so you mentioned this earlier in the interview but like in substrate is there already zero knowledge proof functionality built into that or is that something that parity could build or is that something that external people should be building yeah so the interesting part with substrate is it depends on what you call like being built in right so substrate kind of like ships in multiple layers and multiple levels of abstraction and the thing that parity ships as and the thing that's in the parity

github repo there isn't anything native in there that does zero knowledge stuff in that sense that being said because it's kind of like this extensible framework right there's a lot of repos from ecosystem people out there that do zero knowledge stuff that you can just use right all these things are kind of like composable and extensible and like technical freedom um is is a it's kind of like a major design principle in substrate although the thing might not directly ship with like zero knowledge enabled whatever whatever that means right it's not like you're starting from scratch right it's there's all of this stuff is open source all of this stuff is um ultimately with some limitations compatible with each other depending on what you're doing so it's um you're by no means starting

starting at zero and all the stuff that we're supporting heavily as in like parody but um it's the same is true for photo web 3 foundation are the things that are generalizable right those are the things we're really interested in it's not so much i mean it was also cool if people built like specific applications that really solve this problem right but as great as someone builds something on the way that then you know enables five six seven eight uh other applications to be built on top of it fabi thank you so much for giving us this look at the ecosystem from the perspective of parody maybe a little bit of the history and uh setting the stage for the following interviews thanks for coming on thanks for having me anna next up i'm going to be interviewing

folks from three different paratrain projects we're going to be looking at moonbeam akala and centrifuge to start here's my interview with derek from moonbeam [Music] so hey derek hey welcome to the show i want to hear a little bit more about moonbeam and yourself maybe you can give our audience a short introduction sure yeah happy to do that so uh why don't i start with myself um you know i've been basically building software and technology companies my whole career so that's you know quite some time at this point that's about 20 years now i've been doing that and you know the because the most formative part of my uh my career the formative experience was

this company i started back in 2006 called fuse and um that you know that i was there for a long time building that company up that was a cloud technology company not a crypto company actually just a you know cloud technology company and i was there for i think 13 years building that company up over time you know learned quite a lot in that process met a lot of great people along the way and um you know a lot of those people actually are with me today at the present uh you know the present venture pure stake we started uh you know pure stake in um the beginning of 2019 and uh you know the the way i got into crypto was that my co-founder from this company fuse left uh left to start a crypto project so that got me you know quite interested

you know he's now the founder and ceo of a project called al grand which is based in boston here oh yeah super well known yeah so um yeah so you know that got me quite interested you work with someone for all for for a long time and you know i was quite interested in what he was up to and as i started learning more i said you know i have to you know get into the space and kind of do something uh do something here as well so you know that led to starting uh pure stake and um you know i think our our vision really even coming into it was that you know we're heading into a permanently multi-chain kind of environment uh in the blockchain space and in that environment you know problems related to cross-chain interoperability are the key ones that are kind of the key challenges to

overcome so with that's kind of the mindset we had and i think that led us pretty quickly to to polka dot right um you know i think that they share that vision you know i think they're kind of making it happen even with their substrate you know the substrate technology and um you know it was just a natural fit for us to kind of start working in the polka dot ecosystem so you know we've been building uh our project moon beam and the polka dot ecosystem now for for uh about a year and a half or so it's uh it's definitely come a long way in that time i guess so the the company is actually called pure steak what was pure steak originally planning on doing because i guess moonbeam is sort of the end result of this journey but where were you starting

yeah i mean well i think you know when you kind of come into crypt i don't have um you know this long history like most people so there was a lot of learning that we did particularly when we started in 2019 i think um you know we started doing a lot of infrastructure work um that's kind of the way that we initially started engaging with networks so running validators you know running actually validators on both kusama and on polka dot uh right now so that's how we just started learning just kind of you know how this technology works that's definitely kind of gave us something tangible to kind of engage with like and get involved in the community and yeah so i think that you know what what i guess became clear to us over time was that you know while that's interesting to kind of do this work at the

infrastructure layer you know we saw definitely a much bigger opportunity kind of moving up the stack a bit right to build our own uh you know our own blockchain and yeah i think that um you know the need that we saw was that you know it became pretty clear to us in polka dot that you know there's a lot of people that want to build on polka dot but for some and for some people it makes sense to do uh what we've done and kind of use substrate to build your own blockchain to become a para chain but you know i would say also you know it is a fairly um serious undertaking to do that right i mean it requires you know time the right expertise uh you know a lot of uh capital even to you know win one of these para chain slots

so we kind of saw that there was definitely going to be a good spot to occupy to provide a developer oriented platform like a you know a power chain that would be um a platform that people could deploy adapts to and kind of in this kind of more traditional smart contract like model that people are used to and so you know we were definitely gunning you know gunning for that we thought that would be uh you know we wanted to be you know one of the teams kind of feeling that need cool and so what is moonbeam then maybe we should give the audience sort of a sense for what that it's a para chain but what does it actually do yeah so what what moonbeam is is um it's pretty straightforward the the core concept so basically what we've done is we've done an ethereum implementation

using substrate so substrate is the technology framework that one uses to build para chains and pokedon and you know we've in close partnership with parity you know we've basically uh created uh you know a working ethereum implementation so you know if you're coming from ethereum you know we're trying to create this environment that looks and feels and just behaves you know in a very familiar way and where you can use you know a lot of the existing you know tools that people are used to using uh from ethereum but you know you're you're kind of on polka dot right so you're you get uh benefits of being on polka dot you know we're adding other features kind of on top of this ethereum feature set so things like launching governance and staking you know a lot of features that a lot of other polka dot based projects

are using so we kind of see it as you know there's this familiar part there's this part that you know allows you to use the things you know all these tools that you're used to but then you know we can have the opportunity to extend you know from that core to take advantage of a lot of the the features and things that are possible on pocono in building this out did you interface with the ethereum developers like the go team or the open ethereum folks or were you would you say like you were just taking the spec and then re-implementing it well i'd say that you know and and this is you know credit credit is due is that like parity themselves had like you know obviously have a lot of expertise in you know building these clients and you know a lot of these these components

were already there already part of substrate yeah in particular the the evm implementation was you know largely uh largely there i mean there's definitely evolved and you know improved and got more performant but there was already an existing kind of core evm implementation that existed when we started and so that was a great kind of basis to kind of build on because really with that with that as the core these other components were needed to need to be layered on top so things like um you know these web three rpc endpoints are things that you know would allow the tools to kind of um you know communicate um you know with the node um you know we were creating a lot of these kind of pieces like around uh this evm core that already existed and um yeah i think that um you know that obviously helped us quite

a bit right so and i would say in general that's you know that's the story that kind of a standing on the shoulders of giants kind of situation right so that's not only substrate there's all these you know components that you know uh you know already uh already created and um so that was you know that was very fortuitous so it sounds a little bit like what you've created i i kind of i follow you here where like building a pair chain out itself could be quite an endeavor but building a dap or maybe even like redeploying adapt would allow for faster deployment and also potentially like more experimentation how are you thinking about the way you position yourself and your community do you want to be a sandbox do you want existing ethereum projects to come over like what's your strategy there

yeah so i would say that um you know we're definitely seeing different kinds of folks you know take advantage of moonbeam and kind of engage with us what i would say is that you know for where we're directing a lot of our own energy and kind of our own go to market it's definitely focused on engaging with existing teams that have ethereum code bases right so if you're an existing team you have an ethereum code base you know you're a potential kind of natural partner you know for us because um you can take that code base and just deploy it to moonbeam uh with like little to no changes and then you'll have a polka dot-based deployment so i think that that's kind of um definitely something that we've been talking to a lot of teams at this point about and um

yeah you know i think that we're at a moment now where people are interested and in this idea of oh okay what do you know what does a multi-chain deployment look like you know maybe it is the case that you know you know not i can't serve like all of the users and use cases i want to serve from eth maintenance and there's going to be like a multi-chain deployment of some kind right whether that even be to a layer two or two other chains and i think that you know we're at a moment in time now where people are pretty open to that conversation uh you know due to gas prices among other things that we were talking about earlier yeah actually let's talk about that i mean ethereum i was just saying this before like the way that i had played with some defy in

the summer um using very small sums i was kind of able to do it then at this point i'm actually not able to do it at all like it just doesn't make any sense i would lose any of the the funds that i have in there on gas fees i mean this seems like a pretty massive opportunity for moonbeam to kind of emerge now but like would you say that's one of the primary things that are driving people to reach out to you or like maybe are making so that the reception you're getting is quite open like is this the main reason yeah so it's a good question i would say that yes it is but in our you know what we found is that framing kind of the challenge that someone is facing is just one of scalability is generally like not enough on its own

uh there's a lot of different like options available if you're just seeking to solve a scalability problem um you know i guess i think of those as separate right like scaling i always think of is like speed um i think they're connected in a way because if you had more throughput like then like the fees would be lower basically right so the fees are kind of definitely dependent on the at least in the ethereum model on the load that's on the system so i mean i we see it this way that you know it's kind of a push and a pull i describe it as sometimes right so the the push is you know kind of what i was describing that okay so we're in this environment are kind of are unable to you know to service you know certain users and use cases well um so we need to you know

we're just like losing part of our target market basically right that we can't service uh so that's the push i think the pull that we're seeing though is just interest in polka dot right so i think of the other uh layer one networks that are out there you know polkadot has definitely kind of established itself and i think is you know almost maybe separated a little bit from some of the other other folks out there and you know there's quite a lot of activity going on now and you know a lot of activity is kind of new asset creation like these new projects that are developing so i think for a lot of the the teams we're working with you know particularly ones in the the d5 sector you know they want to be kind of a first mover in this new ecosystem so that they

can get these new assets you know into their protocols right whether that be a dex or a lending borrowing protocol you know these kinds of things so that's that's kind of the pull right so i think that that makes for a you know a good kind of prospect if you want to call it like that for us right is that you know they're recognizing that they need to do something to address these kind of users and use cases they can't address but they're also interested in polka dot interested in expanding uh to polka dot and i would mention that you know almost all the people we work with are not moving right so this is a big misconception i think where people say you're not poaching them from ethereum i guess right that's right it's like this is the old east killer narrative which kind of makes no sense from my

perspective it's it's much more that you know they'll maintain like their their ethereum deployment and service you know the users use cases that you know make sense to service there but then they're expanding and kind of getting at these other you know users use cases and assets icon polkadot so it's additive you know and it's and they you know plan on having multiple deployments at the same time so that's almost universally the case um you know for the projects we're working with are you worried though like given that it is an evm implementation and and i realize like it's going to be a very new network there won't be too much activity on it right off the bat or like i'm sure you want to see it scale up but like it will have less activity than ethereum has but would you not run into the same kind

of problems that ethereum has today so i would say that we have intentionally copied as much as we can from the ethereum model for compatibility so like you know whenever we've come to like forks in the road we've said okay we could do a which might be faster we could do b which will maximize compatibility so we are definitely you know always choosing the compatibility path because we want to really be the the kind of lowest friction you know way you know for people to deploy on polka dot and for to you know to redeploy from from ethereum so that does mean that like ultimately we have the same gas model and that with enough load like you would see increases in like in gas prices now i think that being said there will be quite a bit of like new block space that's

available and um you know that that is going to take like some amount of time basically yeah given you know we have two deployments too right we have a deployment on kusama as well as a deployment on on moonbeam and we can already see that you know potentially there might be some use cases that might be served just fine from uh from kusama that's already happening on kusama now where you see things like nft activity and other things happening there i just just i want to dig on that because so you have an implementation is it moonbeam on kusama and moonbeam on polka dot or is it a different term on kusama yeah we're calling that network uh the kusama network moon river okay so there's moon river is our is the name of our kusama deployment and moon beam is the name of our polka dot

deployment and uh you know the way polka dot works is and how parody works is you know they do things first on kusama so the our moon river network will be launching first right as uh you know as uh the power chain auction start on kusama do you plan on building bridges between moon river and moon beam or moon beam and like eth main net yeah so we do have a number of different uh bridging options that we're making available one of them is just a point-to-point bridge connecting you know for example moonbeam back to uh east mainnet currently that's connecting kind of our our test net backed we have bridge instances connecting back to both coven and rinkeby got it and um you know but you know that's kind of the one that we're maintaining and

that we're going to be behind but there are a number of other ones too because you know that's kind of the beauty of polka dot where you know we can leverage kind of the cross chain integrations that are part of polka dot to take advantage of other bridging efforts so uh for example there's the snow fork team that's building snow bridge um you know that's one that will provide another kind of route to you know moving assets to and from moonbeam from ethereum and then you know we have other integrations underway such as with uh with red and with a newer project called axillar that will provide you know other ways that we can move assets between ethereum and moonbeam cool i'm curious what do you think about because i you know there's this concept of public utility parachains it's kind of common good pair of chains

moonbeam is not that right moonbeam is a stand-alone it is a project in itself and it will be using funds in order to secure a pair change slot but do you think that these public utility pair chains will be useful to moonbeam or do you think that there could even be like a competitor public utility pair chain for some of the ideas i've heard of for these public utility pair chains i mean they certainly will be useful so for example i know that there's one planned uh that would help support uh stable coins like making sure that there's stable coins that are available on on polka dot that any power chain can use so that's obviously something that's a benefit to all of the teams that are building on uh on polka dots so uh same thing with the bridges right so the snow fort

bridge i i mentioned also uh falls into that category where it's just something that i think all the teams need yeah i think you know the the things that are being earmarked for you know for that public good use or something that i i didn't you know like those examples you know i think they'll be generally useful for anyone uh this building i know that there's like canvas and ink that's also kind of a smart contract platform but it's not evm it's not solidity but do you see that as a competitor i mean i realize it's all everyone's in the same ecosystem and it's quite small so everyone's mostly friends but like would people have to make a choice kind of in when they start to think about building adapt there yeah i think that you know the decision tree kind of goes like this so if you're

going to build on polka dot i think the first decision you have to make is do i use substrate to build a para chain or am i going to work with an existing you know power chain team am i going to build on top of a pair of chain so that is definitely the most important first decision and basically depending on which path you go down it actually will will kind of color a lot of what the rest of the execution looks like so you know if you're gonna build a pair of chain then that's you know substrate and rust and uh you know bidding on a pair of chain slot and and all of this if you're going to go down the path of you know working with the pair of chain you know then you know that's you know there's us there's you know other teams that are

that are also you know building smart contract power chains and i would say that you know one of the key choices there would be um you know working with someone like us that's you know the kind of ethereum style implementation using the ethereum dev tool chain or you know using ink which is you know i would say the other main option that's the you know parity created kind of more rust-based smart contracting language what i'd say there is that there's obviously quite a bit of thought and experience that's gone into ink and it definitely um you know serves its purpose um i think that if you're starting from scratch you know that's probably one set of conditions that might you know might weigh into that decision versus if you already have an existing code base right so what i described before is if you know your project

already has a code base i think working with like an evm compatible chain is gonna make a lot of sense right because you can leverage the one code base you know multiple times versus having to recreate something what about the tooling and all the things that exist on ethereum mainnet today like does that come along with it or do you need to redeploy it who would redeploy it and actually like even a more basic level one is like will there be like a meta mask for moonbeam would it be metamask or would it be like your own version of it yeah so it is so definitely it is the case that um you know given this kind of uh always choosing for compatibility as i mentioned before that that allows us to basically like the existing tools to be usable with moonbeam just by changing

kind of where they're connecting to so that is just metamask and you know some users will be familiar with this from working with for example something like x die right where you basically like add a new network and if you add moonbeam as a network then it's the same metamask experience you can still you know use metamask to send funds or to add erc20s and this kind of thing all that is you know a similar experience what i'd say is that tools the remix meta mask you know things like truffle hard hat i mean all these tools are kind of fall into that same bucket where they can they kind of work out of the box as you have to re-point them basically at moonbeam i'd say there's another class of services which are things like um you know infuria the graph there's a kind of you know whether it's more of a

service versus just software those are compatible with moonbeam but you know you don't get them for free in a way right because the infigura is currently you know service it's providing service for for accessing ethereum so but there is where we've seen you know there's other projects that are starting up that are providing these kinds of services and in fact even uh you know some of the folks that are established on ethereum i think a lot of them are you know also pursuing like multi-chain strategies at this point so yeah you know they again are kind of natural partners for us cool let's talk a little bit about the pair chain slots now we've kind of mentioned it a couple times through our interview already this idea that you have a relay chain which is sort of the consensus of polka dot and there's these para chains that connect

to it each pair chain sort of takes a pair chain slot and there is some sort of fee or loan i mean maybe you you can describe this better but there's some sort of amount of money that needs to be put up in order to secure one of those para chain slots can you tell me a little bit about that process from the perspective of a para chain sure so the main auction process which is the main mechanism by which these paratrain slots are going to be allocated has not launched yet so but i can give you kind of um kind of our view on it like you know from where we are now so i guess the most important point is that there is this kind of auction based mechanism that's going to be used so what that means is that you know slots will become

available uh you know polka dot has a finite capacity so there's a finite set of slots that are possible um uh or that are supported and thus those slots will be made available one at a time and as those slots become available there will be an auction where different teams you know ourselves and other teams can basically put bids up uh to occupy those slots and basically the the team that has the winning bid is the team that would then occupy the slot and it is for a finite period so i think it's you can choose 6 12 18 or 24 months uh on polka dot that's the that's the plan and maybe shorter agusama and uh basically the idea is that whatever the amount is that you bid and you bid that in the relay chain

native asset so that would be a dot in the case of polka dot that lets you occupy the slot if you have the winning bid but those dots become kind of locked for the duration of your occupancy so if you are kind of bidding for two years you put up a bunch of dots you win you win the auction then those dots become kind of locked uh you know underneath your pair chain in a way right yeah and so you still have them but i guess you lose the opportunity cost of them you can't use them for anything else uh you're going to see prices potentially fluctuate and you'll just have to sit by and be like that's right but you're obviously getting this valuable kind of service of um you know basically you get like access to the relay chain and you can access

part of the capacity of the validators on the on the relay chain to provide security for your for you know for your parachute cool how did you go about i mean i know that you it's not done yet but i assume the plan is to put dots forward for this slot where do they come from in your case yeah i think what um i mean obviously one place they can come from is that you just have them and you put them up and you know we don't know exactly what the clearing price for these auctions are going to be but it's going to be high right so almost all the teams that i know of including ourselves that are kind of you know bootstrapping themselves into these slots for the first time are using this mechanism called a crowd loan so what a crowd loan is is basically a way

that you can you know kind of obtain the the dot that's needed to you know put a bid up from other people and the idea is that you know as a team you kind of put an offer together right you say okay you know for this amount of our platform tokens you know we request basically uh to borrow like your you know your dot and um you know those people that contribute towards the crowd line will get their dot back but then they're you know that it's up to the team and you know the most common model would be that there's some portion of the platform tokens of the power parachain that would then be kind of distributed to those folks that were contributors you know over the course of the slot occupancy so yeah i think that almost all the teams i've talked to are pursuing that

model because there's a way you can kind of bootstrap yourself without you needing to have you know some huge number of dot already would any team do like half half like would some would you put some up or are you planning on actually doing full crowd loan uh we plan on doing uh full but yeah i think there probably is so you know some i mean you know people people may just have have some right i mean and i think it's if you have them like i mean you know you know it might not make sense to do the crowd load at all but um but yeah i think that you know obviously you know the dot itself has gone up in price a lot so i mean i think these things are not going to necessarily be that that cheap and so if if a participant wanted

to actually like access this or support moonbeam getting that slot they themselves could like if they had our dot holder they could loan through this crowd loan mechanism they could actually loan their dots they would be locked in return they would get some sort of distribution on your network have you already fielded the question to your community like do you know what the interest is there do you have some some expectation on like even how big that is uh yeah and i would say that you know our our plans are kind of evolving as well i mean we're mostly focused on our moon river this first deployment that's coming up where we will be pursuing this strategy and uh i mean there seems to be quite a bit of interest right so uh so we're definitely seeing interest from the community and i mean we're pretty

focused right now on kind of just this moon river launch where we do have that's kind of a little bit of our community-led experiment where we're actually um you know going to be distributing you know a large portion of the uh the platform tokens i should say that our the moon foundation is going to be distributing a large portion of the the tokens on the moon river network via this crown load mechanism so kind of using it as a token distribution mechanism neat and this is all on kusama so you'd have to have kusama tokens to participate um i have sort of one last question about kind of how you interact with the relay chain as a pair chain like you are relying on the validators in the relay chain for your consensus but like do you have validators as well on these networks yeah the the key role that like um that

we have is this role of collater so you know in polka dots design there's kind of this split responsibility right so as a para chain you have these collator nodes that are supporting the para chain that are responsible for block production so those collators are you know producing blocks and then they kind of um offer them up to the relay chain validators and the relay chain validators are then verifying the contents of those blocks and finalizing them so there's kind of this you know very tightly coordinated effort but it is kind of a split responsibility and um yeah that's just part of the you know the polka dot design um you know to kind of have this shared responsibility if you will i guess it almost sounds like a mini like validator set but validator set

light because they're not doing the full validation i guess they're not staking actually they're just acting as this collateral role that's true although you know in and this is kind of up to the different parachute team so we will have staking like on our train that will be used to select like who it is that's producing that's performing this collation rule got it so it is kind of like it will resemble kind of the regular staking mechanics that you find on the relay chain cool well derek want to say a big thank you for coming on the show and helping us to understand moonbeam and also what it looks like from your perspective becoming a pair chain on polka dot yeah well thanks for having me it's great to be here and good luck with the next few months as they you know as these things really start to

come online i think a lot of people will be watching closely thank you [Music] so welcome to the show retau well thank you for having me i'm super excited to be here anna uh retal you are the co-founder of the akala project um i want to hear a little bit about maybe when you started in the polka dot ecosystem and when akala was born well actually we started to look at substrate or we have like interested in the substrate project back in almost like more than two years ago when substrate was still in its early form right so one of our co-founder brian was actually one with the product contributor outside parity to

the substrate cost so we were already familiar with substrate before almost like two years ago and one and a half years ago we decided that hey we think this is super promising we should start a venture and build a specialized blockchain using substrate and that's how we get started cool and your company though it was named something else before right yep what was that original name well the initial name is we call it lamina and still have this name it's like actually our entity we are operating from right so you can think of a yeah think about offline an organization they will be working with a number project and alkalize one of our projects the name behind lamina is that we are nuts and all the co-founders are pretty much nuts we are into physics and stuff

and this one term called laminar flow like when water was flowing in a particular angle you can see it's like almost frictionless and we envision that capital or informational value should be flowing in a fictional way on blockchain as well and hence the name lamina so frictionless flow is what you meant with that yeah but like the project that we're going to basically be talking about is akala when was akala first thought of well actually when we started our venture we think no matter what we do we gotta work on something that's finance related because back then d5 is still not that hard but we already see the promising future of decentralized finance able to be able to bring

and we attended the very very first hackathon or in china we were actually living in new zealand but back then there was the very first hackathon in china a gathering was there as well and we happened to met the other uh co-founder of alkaline network fuyao and we've been through a number of like what we call dating or like the value alignment stuff and ultimately we think oh we are super quick um we are same shot of nerds um we are here for the long term and we should start to work on this project together and that's when arcola was conceived it's actually what i think conceived back in the very first public hackathon uh on polka dots wow that's such a great origin story so like akala is

defy but i don't exactly understand what that means so you will be a para chain on the polka dot network but what is a d5 parachain exactly let me start from the bigger picture like what new possibility uh polkadot enables uh for developers right so when we were building stuff on decentralized blockchain network we are looking like what possibility what capability the base layer is able to provide um if you look at bitcoin there's almost no much you can program you can program the bitcoin network to transfer asset and that's pretty much it and then if you look at ethereum it is great it got us this to this stage it provides new capability for developers such as like you can deploy application now you can

pretty much decide what what's going to happen within your application and deploy on ethereum so that's like new capability new possibility enabled by ethereum compared to bitcoin and if we look at polkadot it actually enable new possibility for developer to design the blockchain in a fully customized way and that's where we call it the d5 chain that's where the concept is conceived we have the ability to take the substrate fully customize fine-tune for one particular use case and in our cases we fight unit for financial applications so we have a stablecoin built-in we have a decentralized exchange built in we have a stacking dirty product built in and we're able to customize like oracle transactions we have to customize like

guest feed payments essentially have the ability to customize down to the core level and to provide much friendlier user experience for the for the participant for the for the user for the traders so i think that's what alkalized in industrial i mean when you talk about this customization that makes sense that you were able to create these building blocks but do you also like are you able to optimize for d5 or is it more just like you can create the lego within one pair of chain well i think it's more of like we are actually able to optimize some stuff for d5 so i mean i'm going to take a number of examples like maybe two examples one if we look at a generic computation platform for example ethereum

all transactions being treated equally right so oracle transaction liable for guest fee payment and when the net was congested the oracle transaction was actually competing for all the other generations out there so what we do with alkalize they we think oracle transaction is like very important it should be paralyzed and it shouldn't be liable for the typical gas cost because like the oracle provider is actually contributing to the network we should be incentivized we should be rewarding them instead of like charging them gas fee so that's why we took this like customizability and we say that oracle transaction or archive is going to be free once you get what listed and your oracle contributor you can submit

price fit on the blockchain for free the second special um capability of archive is that the traders or the user of the network is able to pay gas fee in any form of tokens one of the concept i think is quite fascinating is that if you have die on ethereum and if you want to transfer die you got to pay ease as gas fee well that's okay for for for everyone that's already on default we're getting used to this concept but for someone that's outside the blockchain space they find it very very hard to understand so on alkala we look at that problem and then we say that how can we make it better so we make it that if you transfer ausd which is stable coin on alkala um you can pay a usd as guest fee and we think the fee itself is just like the

bare minimum to prevent the network being attacked being congested and that's like should be as easy as possible for users to transact not like a barrier to prevent the user from transacting so those are like the new stuff when enabled in the device space would you have a project like i don't know balancer or synthetic something that's like currently built on top of ethereum would you build them on top of a color or would you build them into a color well i i think there's like a number way to integrate within a color okay um and you actually mentioned like two possibilities so one is that if a project is like deep into the core of a network for example a bridge um like we work with the rent um

ram bitcoin um so they would like to be a bridge from alkala to their virtual machine so we they actually got to deploy an module within akala and that's one way to integrate with alkala well it's actually harder that way because your code needs to be reviewed there should be an audit every time they deploy but on top of that a developer can also deploy solidity smart contract and reprogram what we created so um i already mentioned that we have a stable coin we have a decentralized exchange we have staking dirty protocol all those primitive that we built is exposed to the evm machine as well so think about an installation developer when they deploy on alkala they have access to those primitive they already built there it's

there for them to use so i think there's a number of ways depends on what project what kind of nature of the project there's a number of way for for deployment does the parachain akala also have its own evm or is are you talking about the evm of another pair chain or another chain in general now we actually have the evm pallet built-in so upon launch alkala we have smart control capability um it is more of like a way that we see her network how a network could be specialized so in our cases dark landed was specialized to have this financial primitive that we coded and we think it's so important to rebuild it into the call but we also think all these financial primitives can be also very useful if they could be reprogrammed and that's

why we have this smart contract capability support the other special thing about alkali is that if you look at evm uh we actually like we look at the whole solidity space as like there's like two component trees like this the evm um the the virtual machine has like the backhand and there's also like metamask the way you interact with the blockchain um the rpc call as the front end one unique aspect of alkali is that we actually optimize the evm as the back end on the front end we still relay on the polkadot signing mechanism we still rely on the pocket.js extension uh we think it's like unique customized solution fine tuned to provide seamless experience for existing pocket.js users so they are interacting with cvm but they didn't realize

they are using the pocket.js signer they are navigating using the same wallet crazy so like your polkadot.js this sort of extension that would be living in your browser would also allow you to interact with not only maybe the ikala parachain but things that are built on top of it exactly we we develop a translation service a translation layer on the fly so from the frontend user's point of view they are interacting with polkadot but from the solidity developer point of view they are coding as like if they were coding on ethereum what kind of projects do you already have built on or building on akala or maybe planned to build on a color because i realize like you know you will be a pair of chain once pair of chains are enabled which is

very very soon but like yeah what kind of projects have already moved over that we might know well there's like a number project we already announced so um ram vm which is essentially a bridge that connecting to the ram vm it's already been the building with us for a long time the ample first which is the ethereum project um they would implement they will open a branch of their implementation on akala there's actually quite a number of projects uh i think we have a full pipeline that with a lot of interest from either like new project or existing ethereum project looking to open branch on polka dots there's quite a number of them so i think not only that i would like authors to look at that once the project goes live once the polka dots space goes live what

sort of new application that can be created on top of akala or on top of other platform on polka dot for example moonbeam that is like only possible to do on polka dots but not only theorem and those are the most exciting things we have a number of projects that might fit into that category but we're gonna announce it when when we're ready got it and i don't know if people already know what they are yet they might still need to kind of emerge and be seen and then people will understand that i think that idea of finding like the unique quality of the l1 is super neat like this is what i like to learn about as well maybe you can give some hint at that though like what kind of new paradigms do you think are enabled by the polka dot setup

well i just think about like we don't actually can see the polka dot a layer one anymore we can see it layer zero oh yeah because and yeah enable project like us able to build like a full clash blockchain with serenity um with the ability to customize to its core so i think uh if you look at that product and then if you look at that hey pogo is actually like a united nation and we are like sovereign country living out of polka dots there's a number of um interesting stuff that might happen for example a country might have diplomatic relationship with another country expressed in the smart contract point of view so let's say the transaction between this country and the other country might be subsidized might be or might even like a mutual beneficial free

transaction between this country and there might be hub country there might be like specialized country well i mean those is going to be super super fun one once um the polka dot ecosystem developed to its like mature status yeah and that's something i can't stop dreaming about i mean every day i was just like when we can get project go live and then we can we can start this like diplomatic relationship with um with other projects do you think there could also be war between them well i think we will see a period of prosperity before we see war okay i would like to yeah i would like to hint one uh use case that i think is super super attractive and they somehow related to the podcast nemesis way

as well so zk so think about alkala right so we are able to create a set of financial primitives such as stablecoin and the stablecoin itself we think alkaline able to circulate to other projects that's the nature of how polka dot works like compostability between different projects think about if there is an project that's working as like a privacy shot focus on privacy and then they cooperate with alkali or they integrate with alkali in a trustless way that the stable coin wants teleported into their shot will become like a z cash version of stable coins interesting those is almost impossible to do with other layer one but it's become like a reality we can gaps in our in in our hand one poker that goes live

and that's the beauty of like have your ability to customize a network to its core right so this is like when you ask me like what sort of new application would be looking at i would be super excited to look at like this specialized network plus that specialized network equal to something even more special neat and you just mentioned zk privacy i am curious like there's currently a lot of work going on it's tyrone guillermo and alex who recently published this paper on private amms what you'd actually need like why that's a lot harder than it seems and what you'd actually need to make that happen are you as a kala also looking to implement any of this privacy on the base chain of itself or are you

only looking to like do kind of bridging to privacy projects well i think in the short term our focus to remain very focused is that we want to make sure that what we built the core primitive is being utilized to its full potential so let's say in the short term we would be unlikely to see for like adding a privacy layer into alkala because we know there's like expertise area that other teams working on so there's a number already a number project working on that sector they are creating a privacy chart so the more we look at it is that how the ecosystem as a collective moving along together by expressing where your most expertise area is and in that way you can see that why we think pagada is a united nation and we

better off if we move along and do what we are doing best right so if we look at the privacy sector there's already a number of projects i'm just working on that and if we're able to transfer aa usd into that privacy shot i don't know about the super fancy mess but they do right but they they might not be as experienced as what we do about like getting the the stable coin to a stable pack or something like that so we all contribute our special ability and ultimately it's better off for the whole ecosystem cool what's the sovereign wealth fund this is something that is kind of championed by akala is this something that you're providing what is that exactly well i think this is something that we it's echo what i

mentioned earlier about how we see parachute and project injecting it's like more of like diplomatic relationships so um we all know that for empower change to have a slot um they're gonna be some stock staked in order to secure that slot right so we come up with these economic models to say that we have six years of subsidized to make sure there's incentive for job holders to stack their dots and supporting alcohol to secure slots but we don't want you like forever doing that because like that creates some sort of uncertainty how can we make sure this is so important in program how can we make sure our project will always have a slot and we start to look at how pertico acquire their fee and buy back to to give essentially give

dividend to token holder and we think about why can we combine those right uh combine those two together and then say that instead of like the protocol to buy back token and spend the fee why do no don't we just like a cure uh the photography in the font and use that font to continue to secure the project slots for the project so i think in a nutshell it tends to ring like that you are renting the house and then you were like working really hard and at some stage you have enough capital to buy the house so you can be operating from their house forever so i think that's the first phase we we think we need to have this um sovereign wealth fund is like to represent that this collective of dots is actually on by the product itself and it's formed um

ultimately by the token holders and it's at at the command of the token holders it's very similar to and to enter a physical sovereign wealth fund as for the common good of this um dispatcher interesting you've already described a lot of like upcoming futures and exciting potential like diplomatic things but yeah if you were to give like a really long shot view on polka dot and akala what do you where do you where would you maybe this is hard to do but where would you like to see yourself in like four or five years let me expand on the serving wheels funds um idea and see um so let's say there are color would like to accu a set of dots so he can have his slots but alkala will be still operating there's still like operation surplus from the protocol

and once you have enough dots what's comes after right so all those um subplots income can be redeployed how do we redeploy those and they will start to imagine that at that point maybe there's some other project they're also going through this project auction and then by then the alcohol could act like as a nation support that project because like this mutual beneficial relationship between two projects i'm just trying to see like some wow imagination here let's say there's going to be an oracle channel and nothing it does nothing but oracle and you need a power chain slot as alkala we also like to depend on a reputable oracle source and maybe we're able to negotiate say hey

if we help you and borrow your project maybe you give us free oracle access as long as our funds supporting you that's very very seamless stuff happening in reality how can we move that to the blockchain so that's something i can already imagine like it becomes like a diplomatic relationship with economic benefit for both of the of the project so the decentralized solving was fun not only can hold dots it might hold maybe some oracle token to make sure he enable access to the other project got it yeah anything further down into the past of like the final evolution of polka dots we might able to see the ultimate vision of like polka dot which in polka dot so maybe there's like tiny nation that's open up like like within a color and like there's like a

relation of of polka dots and then the alkali itself might become a religion yes still connected to polka dots and they might be have its own priority who knows like if you ask me five years maybe is that like infinite scalable right yeah i remember i have actually had i think a while back i had rob on the show and we talked about this like relay chains of relay chains i think it was with him where it was like this sort of these layers of sub relay chains that would act like it would it would change a bit the security model as you went down but it would potentially open up even more pair chain slots or sub parachain slots but um it does seem like one step at a time at this point first the pair of chains need to be deployed

yeah definitely um just before i sign off are you going to be a pair chain on both kusama and polkadot as akala or do you have two different projects we actually have like two different names right so we call it we're definitely going live on kusama first because that's where the canon network and play comes in so we're gonna call our deployment on kusama kurora and it has a logo it looks like a bug as well so bur and best friend okay and then we're gonna one once it's stabilized on kusama then we're gonna deploy the alkaline network on polka dots so you get they actually like two distinctive um brand name they might have different community down further down into the road and we are trying to follow the similar

approach of like kusama and pogo as well so the crew are network might have wider like more aggressive governance so things that's crazy might not get passed on on class governance might get passed on on karua so those is like we how we foresee um the futures movie it's very valuable for an important project to have a canary network with value so they can test stuff out totally cool well good luck with everything retail and thanks so much for this interview thank you thanks for having me anna [Music] hey lucas welcome back to the show hello anna thanks for having me so lucas you've already been on the show

i think it was last year we did a full episode on centrifuge and the way that that project kind of came about how it's constructed what it's for i'll definitely add a link in the show notes if anyone wants to kind of go deep on the project but with today's episode i wanted to bring you back on have maybe a little bit of an update on what you're doing and talk kind of more in the context of the polka dot ecosystem and like being a pair of chain all of this this is what i want to touch on but for our audience who didn't hear your episode yet let's do a quick intro to what centrifuges and to you yeah so centrifuge is focused on bringing real world assets to d5 so what that means is a business an individual that

has like some sort of asset out there that exists in the real world such as a house or some revenue or that's a license for example or some commodities can use that as collateral use that within d5 right because so what you see today is we have this like these crypto native assets and there's this explosion of financial products that are being built right you can leverage your eth you can short sell it you can build these complicated products but this is only really accessible to users who already have these crypto assets but that's not the majority of people this is most people right they actually don't have crypto assets yet they have a house for a business or us dollars something like that and they want to use

the same financial ecosystem right like with this the system that we're building we're building this not just to sort of help our own bubble like ideally we can uh expand that and sort of this real world is more than a thousand times bigger than um what we have in crypto today if you think about the total value locked in d5 jp morgan this the large u.s bank they have about three thousand times more in assets right and so centrifuge is all about how do we bridge this and what we do specifically in the product side is we allow these users to create pools of these different real-world assets that can then be used as as a collateral base as a like an

investment for other d5 protocols so for example you can use your music streaming royalty revenue streams as collateral in maker or you can use by sort of investing in these pools you can invest in real estate um and get exposure through that but completely settled on chain all of it done sort of today on ethereum and so there's sort of two maybe touching touching a bit on the on polka dot and why i'm talking about this now um we have with all these different real world assets we have a huge amount of data that we need to deal with and we need more scalability than what ethereum can give us today and so actually for a long time ago we started building on

substrate the framework that polkadot is built on and went live with our own uh proof of stake chain in um in march last year and so sort of been using both a combination of ethereum define ethereum uh where we do some of our stuff and then substrate-based proof-of-stake chain that we are looking at connecting to polka dot as per chains go live i remember when we spoke last year you were very much kind of centered around these kind of invoices the iou invoice set up is that still the core of it or would you say it's expanded um so i mean already at the time you were thinking of well like what is an asset and of course like invoices are one of the assets the

ones that we started with but we have been we have been expanding it to sort of any kind of non-fungible real world assets right so for us like any any asset that is exists out there that can have an owner we allow you to represent as an nft on chain to sort of then start interacting with on chain through transferring this nft and so i've made a few examples uh music streaming invoices for example or freight shipping invoices are some of the assets we work with but but also real estate farmland a few other asset classes all right so the next question is actually about that polka dot question and being a para chain you were one of the like earlier projects building on substrate

building in the ecosystem and i guess the plan was always to connect in are you going to be one of these first projects that are like on test net on kusama already securing a pair chain slot or is this something you're still sort of evaluating so we have a we have a proof of stake chain that's fundamentally the same as polka dot right like when substrate gives you the option to launch your network with uh the same consensus mechanism and so that's what we started with and so in a way like we've been not just testing we've been actually running this network in production and um so like we started this decision to build a substrate was made over yeah like almost two years ago um and so at the time that there's no not a very

clear timeline on when uh parrot chains would actually go live on polka dot polka dot wasn't live yet kusama wasn't live yet so we said okay we need to have a strategy so we're actually not going to just be stuck waiting for power chains to go live um and and we've always treated our network as like okay this is an independent network but of course the promise of power chains is extremely interesting because we pay several percent in inflation per year to our token holders to secure the network and if we are able to secure power chain slots at a cost that is less than that with a comparable or probably maybe even by number is actually a much bigger network security like validator pool basically exactly

yeah validator pool value at stake right this is very interesting and actually think this is often forgot not really talked about by people but the amount of coordination and the amount of work it takes to run a proof of stake network is quite significant and i'm super happy with the validators that we have you have i think 32 active validators at the moment with like several waiting to join the set so we're like growing this quite well but like even that ride is like a community an effort that you need to run and so as a project to like divide our attention and sort of think about running this network um that's a very big cost and so that's sort of how we think about justifying the cost for a pair chain of course whether we're going to be one

of the first ones or not i think unlike other polka dot based projects for us it's not delaying our launch so yeah maybe we can maybe we're not going to be as desperate to bid on one of the first slots because i expect them like looking at how overhyped this market is right now uh meaning the dot market and all of this power chain loan offerings and projects going on we're going to make sure we're not going to overpay for that right because i think these first few slots they'll look at it more as a marketing expense than uh actually like paying for your security and that's what you want to avoid yeah that actually that's that does put you in a very different category because you're live and you're not necessarily dependent on this consensus mechanism you

can just kind of wait and see and hold off and let it let the network launch settle almost figure out itself and then see where the opportunity to link in is yeah would you have the plan to exist on kusama and polka dot or would you just probably lock into one of these like as a para chain i guess can you choose your standalone so like i'm trying to i'm actually trying to figure that out like do you have to lock into polka dot or can you actually just have like one pair of chain that just decides at some point which relay chain is theirs so one of the that power chains or that substrate gives you is the idea that you can hot swap your consensus

so mechanism so as a running chain you can decide to go from proof of stake to proof of authority to to being part of being a power chain it doesn't look like this is going to be ready when the first pair of chains launch and so likely we won't be able to make use of that and so the thing we can do instead is actually to just do a hard fork basically and that's what it would look like if we were to launch before the hot swap consensus and the hot swapping of consensus is fully implemented production ready and sort of compatible with polka dot that would be something like is that a substrate module that would need to be completed yeah this yeah this work on the

consensus layer and sort of how this is abstracted that needs to happen got it and so you could do it but that you might also be waiting for that substrate module i guess to be completed because it might be even smoother or what maybe i think unlikely though i think we're going to be going for one of the very early slots and okay and not not wait with that um the downside is you have a hard fork meaning like uh it's not as smooth of a transition and a bit of extra coordination but who knows how long this is going to take so i'd rather not bet on that but going back to that earlier question of like kusama or polka dot relay chain i guess when you say it's a swappable consensus you can swap it in for one or the other

right you could go from one to the other that should that theory should be possible okay what is the like current thinking on your part like would you want to be a kusama pair chain or would you rather be a polka dot pair of chain i guess the consensus the value in polka dot is higher so it sort of suggests that the security is higher i think we will want to have sort of this gold standard or or like a extremely high reliability high um quality network security that polka dot will have where i expect kusama to be slightly less stable slightly cheaper and faster we haven't really made a final decision on whether we're going to go for usama

and polkadot or just polka dot the main reason is that you are splitting up liquidity you're sort of setting you're setting up like that twice the governance overhead because you now have two systems to run two power chains to run right like two slots to pay for and and all of that is again thinking about that distraction um it is a bit of a distraction so we might what we might do is we might try out okay sama create like a a test net on kasama but with the price of kosama today it's almost not feasible to use it for testing anymore yeah so yeah we'll have to see how it works out i wonder if kusama needs to create like another canary

for itself yeah at some point though you have to stop creating your tokens are you working with some existing d5 projects that we might already know from the ethereum ecosystem like are there any sort of collaborations that that you can maybe share so what our goal is right to to bring these create liquidity for these real-world assets and integrate them into any protocol that has need for liquidity and there have been two partnerships that we've been focused on um actually we started very early with maker dao and maker dao is in sort of the final phases of doing the technical integration where um our what we call asset originators that bring these assets on chain

can use makerdao as a source to look to borrow the second d5 protocol we're working with is ave who we're looking to basically create a market with where if you deposit die into this market you can get exposure to all sorts of different real world assets and on the flip side sort of all of our different pools can be used as collateral to borrow die against right and so this i really our goal is that now to bring right real estate or invoices into a protocol like avetmaker to allow them to diversify their collateral base and for the asset originators actually to have a competitive source of liquidity and be able to to arbitrage maker for ave and move

money around like bring bring in external investors and sort of create some liquidity in this market and so yeah that's we've been working on are you creating a unique bridge to do that since you're a substrate chain you're not an erc20 so you like you have to somehow connect to it yeah so we launched a trusted bridge that we developed together with chain safe in may last year so there's a bridge from ether from central future ethereum that allows you to bridge these assets and sort of interact with the d5 ecosystem on ethereum and um that bridge actually was jointly developed with um cello and aragon for bridging just sort of other chains

to ethereum likely sort of and that is actually one of the big benefits that polka dot has is that with the trustless flight client that they're building the bridge model that they'll be able to offer is actually well the security of it is is extremely attractive right and so that that will make it uh much more interesting and will make it very attractive for us to be able to sort of retire this this bridge that today relies on on a set of our validators to basically sign messages and verify it and replace it with this fully trustless bridge would you use one of the existing para chain bridge projects like the snow fork or these i mean this has come up in the previous ones yeah the one i'm talking about is no fork okay we've been working very closely with them

share we share some people on the team as well last question i have for you has to do with zero knowledge proofs on polka dot centrifuge is known as being sort of a zk focused project we didn't talk about it at all so far but like are you still using zero knowledge proofs is this still like in the like is it already implemented or is this sort of like uh uh to do or or have you given up no we have definitely haven't given up i can maybe i can say like why privacy and why is your knowledge matters to us it's like obviously d5 today like is fully transparent and somehow people don't seem to care too much about like all of their financial uh transactions being in the public and i mean if you start looking on etherscan at your app at your

friend's addresses and you start following the money around it's actually quite interesting what you can find out right and that's fine for most people it isn't fine for a business right like if i yeah if i'm starting to put my all of my invoices into the clear well then like i'm going to tell my competition like where i buy stuff what i buy how much how often and all that information obviously is like my competitive advantage and so i i don't want to want to do that so that's why we've been for a very from a very early point in time been focusing on privacy we ultimately decided to abandon what we've been doing on ethereum just because there's plenty of activity with um zk roll up and

a few others that are actually leveraging the built-in curves in ethereum but i don't think they're long-term that's a good investment for us to sort of focus on this in my opinion outdated technology there's way more interesting privacy focused stuff happening outside of ethereum and that is actually one thing that we really like with substrate and polka dot is that it gives you an insane amount of flexibility about what you can put into your runtime and so one of the things we want to put into our runtime that runs our chain is cryptographic primitives that are much better much more recent than what you have on ethereum and so um to to enable these our asset originators to have more privacy as they're borrowing money as they're sort of originating these assets

so yeah that's uh something that we'll we're still working on um so we've been working prototyping some stuff on the substrate side but um cool um it's gonna take a while but i mean there are now also a few other projects that are actually like working bringing zero knowledge proof stuff into substrate and polka dot we should see this boom of like ck roll ups privacy tech like attempts at private amms um what do you what do you make of that do you feel like that community like is it becoming more vibrant from where you're sitting since you were one of the first yeah i mean definitely like the amount of people that understand the topic and have been building and it has been growing quite steadily and a lot of people are excited about

like zero knowledge for not just privacy but also scalability reasons and i think that's yeah that is there's there's a lot happening i think my challenge with polka dot is that the power chains are still not live yet and so a lot of this innovations really just on the in theory or on paper you have to see some test nets and some stuff but i'm really hoping to see what will actually work and what will what will pick up um steam as power chains go live cool well lucas thank you so much for coming back on the show yeah it's good to be back and catching us up i hope we get to have another interview in i don't know a few months or a year and find out more about what's going on in the centrifuge world when we think you think uh when pirate

chains will be live well i hope it happens before then i agree with this all right cool all right see you later [Music] i want to say thank you to all of the interviewees for taking the time to share their insights here i'd also love to hear from you what are your thoughts about this episode what topics should i potentially cover next be sure to subscribe to the show maybe share our podcast leave some comments or ratings catch us on twitter or join the conversation over on telegram i've added links to all of these in the show notes so thanks again to the interviewees and to our listeners thanks for listening you