Ethan Buchman & Zaki Manian: ATOM 2.0 – Deep Dive

Welcome to epicenter. The show is talks about the Technologies projects and people driving decentralisation and the blockchain revolution. I'm suggesting with you. And I'm here with my co-host, Brian crane. Today, we're speaking with Zaki mannion, co-founder of occlusion, and Ethan, Bachmann co-founder of Cosmos and head accountant had Formal now he's a CEO of informal but based on how he's dressed, he could be the HR manager.

But I will be talking about adding 3.0 and Diving deep into this topic, which I feel like I've been just talking about for the last three weeks non-stop. Unlike podcast interspaces and everywhere. But hopefully, we have to the bottom of it today before we talk to Zach and Ethan about the people in the white paper and some of the recent changes, their first like to tell you about our sponsor this week. And that is Tallyho, Tallyho is an open source wallet, really?

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Dash manager. That's a bit of a mouthful. We'll put that in the show notes and please show this with anyone, you think might be a good fit for this position, so Thank you for joining us guys. For this very important conversation about Adam 2.0. Yeah, give us a bit of a. Give us the arch of how this, how we got here. Yeah, I don't point. I was announced that Cosmo verse I guess now three weeks ago. What's happened since then and

did it go as you expected. I mean I think the main the main goal was to kick off a vigorous conversation about our Adam political economy and I think that has clearly been achieved this is the most you know vigorous set of discussions we've seen today that it's quite delightful to actually see all that and you know to see the passion and enthusiasm about about the project and there were some very bold you know offers let's say in the paper and so there's you know, Rightly.

So there's that's kicked off a lot of discussion, some controversy, you know there's there's going to need to be changes but you know we wanted we wanted to kick this thing off with a bang and put out a really strong vision for what the future of the cosmos up could look like and that should include some you know, potentially large controversial. Controversial changes that might need to get worked out. And so I think we're really excited about the level of

Engagement we've seen. And, you know, there's work now, on a charter, there's a lot of discussions around, you know, how We're going to do governance moving forward and all this stuff. And so you know, at Kauffman verse, I sort of talked about how there's these sort of three big faces of Cosmos, you know, start with this initiation phase, which we completed, which started with a white paper, which we shipping completion, right?

And now, we're moving into the integration phase and this has its own white paper for the Hub. But, you know, there's a lot more to it. It's really about upgrading the overall political economy of the interchain ecosystem of the cosmos Hub. And and, and that process is kicking off now. So, you know, this podcast and all the other discussion These are kind of a big part of that. So yeah. And what's that? What's that face? Three phase 3 I called the

illumination phase. We're all finally awakened to, you know, the reality of the payments graph and and, and crypto finally has its impact on the world and we can break out of our, you know, speculative crypto Bubbles and actually you know, meaningfully restructure, the global monetary system. So of course, I'll have to be wearing. Yeah, I might need a different tie for that. You're going to need a three-piece suit for that one? Yeah, exactly. I gotta be the tax.

Maybe one thing we can also I think makes sense to ask about this point. So we have this white paper, right? And there was a lot of authors on there, there's like ten people and then I think there's like, you know, other people that were involved in some way that, you know, aren't even on there. So can you talk a bit about like, what first of all, what was the goal of this white paper and what was the process of writing this paper? Okay. So maybe I can I can come at the the two things.

One, the goal of this white paper is to is to let out a vision from that basically takes. I think there is a group of people who work on Cosmos who feel like the cosmos Hub has been abandoned. That was like a it was it was just collectively abandoned over the last few years. It did not have any strong vision. So many people who used to work on, you know, Adam and the cosmos Hub started their own chains. You know you have this vast post

all in B diaspora. You certainly had a team at the inner chain Foundation but they, their mandate was much more like maintenance and following a relatively conservative roadmap. Not, you know, change what? Adam is change, what? Adam means, all this stuff. What? Like the whole, you know, the whole political economy about Adam? We had an ambitious roadmap, tried it. Try to even imagine what Adam

would look like. As I could tell top-10 crypto acid, what an atom looks like as a driving force for change for like, all of, like like economics. Generally, like how do we so. So there's like just sort of this abandonment and lack of ambition that was like pervading

the cosmos Hub as a culture. Also, the political economy of the cosmos I was in The NeverEnding sort of back and forth between all in bits and the ICF Birth who is supposed to even be involved in charge of this thing with neither party really wanting to be in charge. And so like that was, that's kind of the framework. The framework was break out of that cycle. The second component of it was. So then, what was the process? Like the process was like, in

short of, I would say. So, you know, the liquid staking work that inclusion has been working on has been going on since 2021. It took quite a bit, you know. Has been. It's been it's been a slow burned, bring to figure out how to make liquid staking.

And it liquid, staking always seemed like a very important formative because of the fact that we don't want to have defy on the Hub. We needed to figure out like liquid speaking is a very natural solution to the problem of how do we get out of an exponential issuance regime? And if you're as long as you're walked into the exponential issuance regime like your ability to change anything else

Is very limited, right? Like the the potential capabilities of. So we have this like, sort of long-term thing where like the occlusion, co-founders me Christie, Tony Cella, a team at occlusion. Have been like diligently, pushing forward, liquid staking, because of the fact that it unlocks a lot of other possibilities, but the other thing that we saw during the sort of, you know, 2021 cycle is we saw a lot of new economic crypto. Make experiments.

We saw Mev become go from being like a thing that people have been in the cosmos Community have been hypothesizing about since 2015 and 2016 becoming like an actual industry. We saw like, you know, Sonny was tweeting about and like sunning and me internet. Oh, like DMS about, you know, how fascinating the like Olympus Dow mechanism was and all of these things, kind of got sort of eventually started. Come together as a set of building blocks.

And then, an R&D effort was kicked off with many, many people, many of whom are authors, but many more people are not authors. We also, you know, we like Christy and myself, we invested in Mecca Tech. We invested in skip. We were talking to all of the Mev people. I spent a lot of time at the fleshpots people. There's this like whole research effort that like was just kind of many different people.

I met Max, She want me to, you know, really turn the allocator from being just like a set of bullet points for a long time. I met him at the hallways of Oz work on and Max and Sam were able to like work together to turn the alligator and do it like a fully fleshed-out idea or at least a partially flushed out idea. You know the idea of you know Jahan and the and like the informal ICS team became like big contributors to the idea of the scheduler.

Sam also is a huge driver of the schedule or idea but we all talk to Our friends at Skip and megatech extensively. So like there's just this whole sort of somewhat organic, Community Driven R&D effort to try and bring all these pieces together and then we decided to set ourselves a hard deadline of having something big to announce. It caused me a verse and and we were able to get a draft of the white paper out by then and kick off this conversation.

Yeah, I think this is one of the things that stands out regarding the right here, but it's just, there's a lot in there, right? There's a lot of different, you know, things have been worked on and, you know, on a new things, right? So some things that I think are like reasonably well known and some things, I think we're very new.

So I think maybe we'll make sense as we can talk a little bit about some of those changes that, you know, either are like coming and in works or that are, you know, being proposed here and then talk. And then maybe step it. Take a step back talk. Also about governance is entire process and maybe, but I would say, let's start with interchange security. I think interchange security is something we've actually never talked about on this podcast.

I think in the cosmos communities like reasonably well known, but I think I wouldn't say it's something that's well known in a large group the community. So like what interchange security and what is the role that information security will play in Cosmos in the future? So if you don't mind, Before we going, we go into interchange security because the just to add a little bit more framing to the

structure of the white paper. And you know why we would jump right into injured, interchange security at a high level. You know, the white paper is really putting forth like three key pieces that of like how to think about the future of the hop, right? The first is that there's a new secure economic scaling layer, that includes interchange security and liquid state, right?

And it proposes that interchange security is the way to build new functionality for the Hub and liquid staking is the way to extend. The economic zone of the cosmos, not like certain sake, was referring to before, right? And and and you know, that inclusion, did all this work on it on limits, taking photos are all this work on interchange security to set this foundation for how we could extend the sort of economic reality of the Hub. So, that's the base layer,

right? And in some sense, the everyone kind of knew where was supportive of these two kind of key features, but then the question, the paper want to answer is, well, how do we build an actual product out of this and a vision for the Hub that is built on top of this news, secure economic Base layer. And so, you know, the next sort of key piece of the papers that okay, we can create an economic flywheel on top of these two things.

Using, you know, these new proposals of The Interchange scheduler and the interchain allocator, which we can obviously get into, in a lot more in a lot more detail later on. And then, in order, you know, in order to make all of this work, it's going to require basically a new governance system and and treasury to oversee development and facilitate the sort of on chain on chain coordination. So those are really the three pieces.

Secure economic scaling, the economic flywheel with The scheduler in the allocator, and then the governance and the treasury, and the being proposed as an integrated whole, because the idea is that we kind of need all of this to put forward a new, a new vision for the ha, right? So that's the kind of higher level, higher level Framing and then we could start going through, you know, all the different, all the different pieces.

And so, starting with interchange security, the Crux of energy and security, you know, just just base layer is, you know, we want the Hub to be a simple. Minimalistic low surface area. High-security, trusted reliable.

Will place to custody assets to you know enter the ecosystem to integrate against and and so on and that requires a particular kind of care around its software development life cycle and because there isn't a virtual machine on the Hub and there's General agreement that there that there ought not to be a virtual machine on the Hub. The, the idea is that the proper way to extend, the functionality of the Hub is to follow, you know, standard good software development principles of

modularity, you know, and build things in separate modular. Donuts. And because we have IBC because we have the power of 10 or mention all this amazing stuff. We can actually build additional functionality for the Hub. As separate block chains, where the validators are the same as the validators for the cosmos top, right?

And that's the sort of core base idea of energy insecurity is it's a way to extend the functionality of the cosmos up by spinning up. New blockchains that inherit the same the same validator separate and that can resolve a lot of,

you know, tensions. We've seen in the past over governance proposals, some new features wants to be If someone wants to ship, you know, cause mom's into the hob or something like that, there's there's you know, a bit contentious boat and there's a lot of concerns around around the security, what kind of service area this would open up on the Hub and and so on and so interesting security allows us to preserve the minimalism of the core Hub, while still allowing the functionality to

expand around the hub. Using, you know, all the protocols and all the, all the pieces we've already built in the sort of bottom-up way, right? And so while we see many other projects in the ecosystem pursuing, Security Solutions and charting and all these kinds of things and sort of a top-down way.

You know, we built IBC. It was obviously, is a general-purpose communication protocol for arbitrary State machines essentially, and it was always sort of known that on top of IBC in a more bottom-up way, we build these more complex cross chain. Protocols one, obvious one being entertained security where you can simply inherit the validator set from another change. So that's the, that's the sort of high level high level initial framing.

Of course, you can do a lot more with interchange security, it can become. A vehicle for other chains that aren't just trying to extend the functionality of the hub for say, what are you know, looking for a secure validator set to launch an application and will maybe spin out to a sovereign change over time or existing Sovereign chains want to spin and sort of join the economic zone around around the cosmos table. There's a lot more sort of political economics that can that can play out.

Once you have this feature of interchange security but it's really a sort of Base functionality that enables the economics economic zone around the Hub to start to expand. Yeah, I mean I think that you brought it up right? Because I feel like that that's one point where it's maybe little bit confusing. Sort of you know, what is the main vision for interchange Security in the future, right? Because one is okay, there's a hub and you know there's this idea or let's put Cosmos on the Hop.

And then there was resistance is like, okay let's put it in this separate chain. That still secured by the cosmos hop by Adams, you know, what's kind of decoupled. So it's it's sort of like maybe good compromise. And you can imagine like different types of things where like, okay. The Hop says, we want to have additional functionality and we put it there. But then the other thing is, is okay. We you just have some some chain and they don't want to run their

own validator set, right? And they want to use the validated set of the cosmos top and then they kind of like buying basically not that dissimilar from something I can polka dot right. Where pair of chain, basically leases the slot and then gets his file data set. And you know this Security and processing of transactions. So how do you season the future? Do you think disc there's going to be, you're going to be able to evolve into, you know, some

marketplace. Where, you know, like lots of new chains can come and kind of bit for places or So first thing I would say is empirically, I was wrong about interchain security, I was wrong in a couple of different ways. So one was so like the reason I supported prop 69 was I thought that the demand for energy like energy and security was going to be low for sort of external teams that we wouldn't actually be able to grow the developer base of the Cosmos Club.

So we would just end up in a Relation where you had like the same Cosmos of Team supporting like 15 chains. So for each feet like for features that we wanted on the cosmos Hub instead of and so that was kind of a little bit of like, why I thought prop 69 was a good, what good thing and I was completely wrong about this empirically. Like we have attracted an enormous and expanding set of

Builders into the cosmos. Have ecosystem through the feature of energy, insecurity, like I was completely wrong about Out it empirically, you know, just from talking to all these this entire universe of potential users. There's an enormous amount of latent demand for interchange

Securities product. People are very excited about it and not is a huge factor in how we are, have how we have started, you know, and and basically going through the sales cycle, like I think the sales cycle of actually trying to convince projects to join inner to use energy and security, like, kicked off, seriously, maybe in the Spring

of twenty 20 of this year. Yeah, and so when we, when we kicked that off initially I don't think it was going it was it was going about as badly as I was expecting and then we just started hitting user after user after user and it has just been so that like really reshaped, that was a huge influence on the white paper because it said, hey, like we really do see signs of product Market fit here with interchange security.

We should design the white. A ver to like to like, you know, push down on the gas and go go as fast as we can. And like, essentially, this become, you know, in some senses like we're investing in the growth of energy and security, because we have such strong signal of product Market fit. Yeah. I mean, I would say, I was, I was somewhat uncertain about the product Market fit of of interchange security for other chains.

What I was confident and you know, the reason I didn't support prop, 69 at the time was because it certainly, I always felt that interchange security was the right way to sort of offload. Risk of developing The Hub and, you know, have the Hub be able to serve as this sort of stable mature kind of minimalistic anchor where you could extend the funk, right? So if you could extend the functionality with energy insecurity.

So even if there wasn't the sort of demand from other change to use it, there was still a base case just from, you know, better software development life cycle kind of long-term development of the systems that made interchange security. Make sense, just as a way to expand the Hub and expand the teams of the Hub, right? And once once a formal sort of got building interchange security, and we had Something real that people could actually start to believe.

Oh this is really coming soon. You know, then we started going to Market and we started to see, you know, maybe somewhat are surprised some what some people thought it would be you know in high demand. Others were kind of less sure there seems to be a huge amount of demand for it and and that's going to that's going to change over overtime. We don't know exactly how it's going to change over time.

We think we could build out a very healthy economy around the cosmos Hub and and that's part of like succubus saying part of the motivation for the paper was to kind of build on that on what appears to be, you know, strong product Market fit for for

entertain security. But even without You know you have to keep in mind that there's still this base case of this is the right way to extend the functionality of the Hub from a pure like sound software development, kind of principles perspective and one of the things we are trying to achieve is to transform the way software is built and deployed right in the long term that's something Cosmos has been working on for a

long time. That's like part of it, you know, informal systems mission statement and that's something we're doing. I mean the way the way people are building block chains today is you know unlike anything they were doing five years ago and we hope that's going to you know continue to have an impact on the wider software development community. And you know we're trying to prove That out with these new, these new ways of building on

the internet of blockchains. Oh, One of the things that I find interesting about endurance Internet Security, I don't know if this is still in the roadmap, but it's these different versions that have been kind of laid out for how energy Security

will will roll out. So the first version I believe, is this where a chain that's on interchange security, inherits the entire validators, that and then there's a second version where they can inherit a partial about or set or more like an opt-in relationship with validators. And then there's As a third version, where they can have part part of their validator said, be The Interchange security set. So, like the set that securing the cosmos Hub and then they can also onboard their own

validators externally, right? So if another validator, that's not on the cosmos Hub and part of the energy and security set that validator could also on board and be part of that change security. When I first heard this, I thought there's a logical version 4 and that version 4 is where like chains are just Dating each other.

And this this idea has been put forth recently by sunny and the osmosis team and, you know, they're their vision for how we arrived at say, a more interconnected entertained is through this message, security model, and I wonder if I'd like to confront maybe with this like this, this mess Acuity idea does interchange security at some point, become more of a mesh.

rather than this more, like, hub-and-spoke model that I think the Hub has been, Carrying for like a long time and is seems to be carrying in these different versions or at least in this Vision, this been laid out that there's it. Arrived at where everything's just validating and securing each other at some point that to some extent. I mean, you know, if you look back at the original at the original consoles, have white paper. Yes, it's proposing a hub-and-spoke model but it's not

just proposing one hop, right? It's proposing a multiplicity of hubs and it's saying we're going to start with, you know, we're going to build one Hub, but there ought to be others and, and that's in the paper. And so in some Since the, the topology of the cosmos Network, and you know, what would Now call, the inner chain was always left open and was always

expected to be a mesh, right? It's not just a pure Hub and spoke model, but if you look at any any, you know, Network in the real world, they tend to have kind of power law scaling. They tend to have nodes in a more, you know. Well, connect and others. They don't have singular hubs but they do have, you know, it's not like a pure hub-and-spoke, but it there are no nodes in the network that are considered more

Hub like than than others. And you know, the being a hub is sort of a fractal, how you can look at airports and Um, and, and things like this as an example.

And so again, that's always been sort of part of the idea of how the inner chain would emerge, that we would build this permission list communication protocol topology, with what sort of emerge emerge from it. And there are many ways just to share security over the inner chain and have different chains, or to participate in each other's security budget, you know, like you sort of articulated here.

There's, there's interchange security V1, which you can, at the very least, think about, you know, just as a way, for the Hub to extend its own functionality There's the fabled V2 and V3, you know what, you're referring to, and then, and then there's this, you know, V4, I guess you could call mess security. If, if you like, I don't know if they like calling it calling it before. It's also a very interesting idea, but there's much there's much more to, right?

There's other ways to kind of share security across the inner chain. There's now ideas around Hemorrhage and his temperament right where you can basically this something we talked about for a few years now especially with the as well with the anoma team where you can leverage overlap that exists between the validator sets to get stronger, guarantees out of the consensus and of the ordering.

And so And my security sort of a start at that, but it's really just about, you know, some slashing and, you know, it doesn't really do much for transaction ordering, whereas we could do a lot more. So, yeah. Certainly always been the vision for this interchain to be a match. The same way the internet is a mesh but like any mesh in nature there, you know, there will tend to be some kind of power law scaling.

There will be there will be nodes within the mash that are more Hub like and and the Kosmos Hub through its you know, through its mission to be a stable sort of anchor in this thrashing. See in tends to be one of those hubs not the only Hub maybe not even And the biggest Hub in the long term, but but at least you know, I would hope the longest standing Hub and and that's what's important to me is that kind of that kind of long-term ism.

If you think of that, I mean of course one of the challenges at least with this initial version of Shades or interchange security is that, you know if you're running a violator on the Hub? Now you also going to have to run you know this other client right for this other chain and so sort of like, you know, your demands increase a bit. Now maybe that's like not that bad, but then if you imagine, you know, 100 chains, then like complexity grows a lot.

So curious like what's the You know, like how, how much does this scale like? Yeah, I mean there's a there's a lot of work happening to start thinking about how to make it scale more, right? And so we can imagine, I mean, rabbit ears. Today. You know, there's some valid ears that are running a dozen chains, dozens of chains, there's a lot of work now going into into 10 remain in the SDK to make them just more vertically. Scalable.

There's, you know, optimizations kind of all over the place that we can be doing to improve things. And then there are some, you know, there is some research going on. In at the energy insecurity, level of how we can make that that more scalable. And and so there is a lot of opportunity there to improve the scalability. But, you know, it's funny because the cosmos is the cosmos vision and approach is always

the same. It's like do the simple thing that works, you know, that will likely that will likely have product Market, fit and unlock new opportunities and then things, you you didn't really know before will emerge to solve your scalability problems, right? And you know, as we did that with application-specific blockchains overlooked. How's this going to scale? And you know, no one's asking that question anymore.

But Now, we have things like Roll-Ups and all this other, you know, ZK proofs and stuff to help them scale. So we're doing a similar thing with energy insecurities like let's do the simplest basic thing building on top of IBC that if you know allows us to extend functionality in a secure way. And and and we're sure we'll sort of, you know, be able to take care of scalability in the longer term, with all the RV that's happening within our teams around our teams and so on.

So yeah, moving on here to another component of item 2.0 and that's liquid staking. And so, you know, if we look at liquid staking is this mechanism Which one can leverage their state Assets in defy, and other like Financial activities? And so, the idea is that you solve this takers dilemma by allowing State assets to become liquid, or at least some derivative of that state asset to be liquid. And liquid, staking has been, you know, tried and tested and

etherium with like platforms. Like Li do also like, in Solana and lots of other chains in Cosmos, we've been talking about liquid staking For a while. And there was a number of participants like companies and startups in the space that are building liquid staking Solutions. So stride is one of them. Peace. Take was early to this Market as well. Quicksilver, of course, what does the cosmos implementation of liquid staking have, that's unique?

And what are the characteristics of the the cosmos ecosystem as this kind of, grouping of layer ones have it? That makes the implementation unique compared to something like aetherium where you have One layer one. And basically everyone's taking on the same on the same chain. Yeah, okay, so inclusion has been working, has been sort of spearheading the the liquid staking.

Well what we've what inclusion is been building is specifically A Primitive for liquid staking to make liquid sticking adoption easier. So, you know, in most chains that have liquid staking they could speak Was sort of an afterthought in the sense of hey, we we built the system. We had stinking, we need to have stake in order to have to drive to waik secure the consensus layer.

Maybe there's this desire for have liquid sticking on top of it and then whatever programmability your your your platform enables you can glue on some liquid staking components on top of that and, and do it. I would I think of is maybe like the occlusion perspective and what I hope to become the cosmos perspective on liquid. Staking his Wicked staking is not just interesting from a individual Staker trying to optimize their returns point of view.

It's actually unlocks The Dilemma that like was sort of I think one of them was clear. It was very clearly articulated in the original Cosmos white paper which was hey, you have this problem, right? Is everyone, everybody. It's the idea of, you know, cryptocurrencies have been very attracted this idea of fixed Supply assets, deflationary

assets. These are very powerful ideas, but if you have a staking system, you have will have other economic use cases for your, your stable asset, and you will constantly have to be in equilibrium. And the only way to stabilize that equilibrium is to constantly meant an exponentially increasing amount of those assets. And if you actually get to a world of large-scale adoption of liquids, taking IE everyone. Nearly everyone in. Your stinking ecosystem is using

liquid sneaking. You basically have created an it and use new security ecosystem and you security system in for the chain that no longer requires exponential inflation in order to be maintained to be stabilized.

And that's, that's sort of, that's one piece and so what inclusion is, but trying to do Has been trying to make adoption within the staking Market because basically if there is a world in which to adopt liquid, staking you have to, you know, wait 21 days unstaged, give up 21 days of rewards, just the workflow of, oh, I'm a user. I'm going to like click a button on a website. Wait, 21 days, come back to that

website in 21 days. Then like a DOT liquid staking like the the adoption of looking staking will take forever and what inclusion has been working on. And is slated to be merged the default Cosmos. That's the case. Taking module is a set of Primitives that allow you to have life sort of a layer in which people are able to adopt a liquid sneaking solution instantaneously through a transaction without having to wait a non-bonding period to join the system.

You want to talk about the expectation and liquid taking is actually going to be carried out by block chains themselves, rather than by centralized providers, or interchange counts, and sort of how that How that connects? Yeah, yeah that was my next question actually.

I think there's a there's a real user experience challenge here that were probably going to end up facing which is that you'll have these kind of ecosystem level liquid, staking providers, like, the ones I mentioned earlier, but then each chain may also opt to do their own want to capture those assets and do

their own liquid staking. Then we end up in this situation where you have all these assets, essentially represent very similar things but that aren't fungible, And we already have this problem with USD, stable coins, maybe not so much in Cosmos, but like any Theory. Mm, there's like a ton of different USD representative sample points that aren't fungible. And, you know, for users is very hard to reason about like what are the security models behind

those those coins. So how do we solve this without creating like a huge cluster? Fuck. So I guess a couple of things that are I think are important. One is so I think that the fact that we have many USD stable

coins is a good thing. It's good for decentralization, it's good for the economy because basically what you want to have for like every there are multiple categories that naturally occur in stable coins optimizing for, you know, different tolerance, risk Tolerance on minting mechanisms different regulatory stances different.

You no affiliation And brand affiliations associated with your stable coin like there's a there's a very large like high-dimensional space of stable, coin designs and it's good to actually have Market leaders. Kind of optimizing for each different thing. What we what I suspect is the case with liquid staking is it is a similar sort of thing where there are at where it is

actually awake. There's a lot of different dimensions to optimize for for with it's taking Solutions and the whole point of the occlusion with mistake a module. To make it possible to for people to spend on projects. It's for all possible sets of optimizations around creating the great liquid sticking product without specifies doing specifying or picking winners. Just making life easier and you

have better for all of them. And I think the optimal outcome for Cosmos is in many ways, probably, at least for Adam is going to be like a liquid state can provider that like wins the market as like, The permission list retail oriented decentralized. No kyc sticking. Provider, another sticking for liquid state. A provider is going to hopefully win the like institutional, KY exeed at everyone involved. Like the entire pool is kyc Aid

model. Like and you know, there may be other variables here about how governance works or about how like liquidity is incentivized and defy by and like whether or not your energy. Secured and whether or not the treasury is helping secure liquidity for your asset or you're an independent Sovereign chain and you're using your own governance token to incentivize liquidity.

There's so many different variables here that I think it's particularly, it's probably a good thing that we have a lot of that. We have a lot of different choices just at a higher level. Like again, you know, we built, we built IBC general-purpose protocol for communicating between blockchains and obviously allows other chains to

steak on each other, right? And liquid-liquid staking is kind of an inevitability having you can, you can, you know, stick your head in the sand or or think you're going to play, you know, whack-a-mole, till the end of time to stop it. But it's it's it's kind of inevitable. And so you need to you need to account for that.

And you know, we're moving into a world where ideally more liquid staking is going to move from the centralized providers to block chains themselves that are staking the assets back over, IBC onto the Hub and and the module that it Didn't feel that gets deployed on the Hub, makes it easier for folks to sort of take their stake position from The Hub and move it onto those liquids taking providers. But it does. So in a way that, you know, they're initially non fungible on the Hub, right?

So it's just like a, you know, a kind of transferable delegation token but not really a fungible currency by any means that could then get moved into these liquid taking providers pooled, you know, have the risk managed and and so on and made made liquid in various different ways according to you know different criteria like He was saying it so having having blockchains themselves, play a larger role in you know, issuing basically

you know, a medium of exchange token to circulate within the wider economy that's backed by state. Datum is kind of the the approach here and to build that representation directly into the system, right? Where there are, there are realities that exist kind of potentially outside the system, you want to represent them a little bit better in the system so that you can manage them and

monitor them. And and so on, that's also kind of part of the cosmos philosophy is to try to better represent, you know, the reality of the world within the structure of the state. Genes are not just like deny something, you know, that you might not like, or you might think, you know, is, you know, his wrist or something. You actually try to try to bring it on board and manage it

explicitly. Absolutely. I think, I think this is going to be very mind-blowing when people see these interchain account applications that are going to come. And I think it's going to be really amazing right there. Now, everyone at the power of things here is tourists, are you can build, you liquid, staking protocol on your own chain and then connect to different

Cosmos, Chain Reaction accounts. And basically it's just like like we staking out of the Box, which is very different from the way liquid staking Solutions. Have worked so far, where, you know, basically each time for each chain, something is developed deployed, you know, it's a lot of effort in there. And so having that kind of scaling is going to be like, super powerful People just still probably think of IBC is like some simple token, bridging thing, but it's really not.

It's general-purpose communication protocol for State machines, and with energy, security, and energy, and accounts, and energy inquiries. And, you know, a lot of these things that are starting to come online and, you know, will start to have like real product usage. Next year, I think people are really going to wake up to a new new breed of of

interoperability. That'll really, you know, really shake things up and get them to kind of really understand where Cosmos is going and kind of how how far ahead we are in thinking about, you know, in the inner chain and Inter blockchain communication and so on. Yeah. So that's very exciting. So we've talked about two things so far right and you change security liquid staking.

I think actually both of those things are things for basically like everyone's on board, you know, and it's been in work for a while and there's not much like controversial discussion about it. Maybe there's like, I know some minor things, you know, where people, but like over, all right, babe, pretty much consensus.

And I think that the white paper basically, sort of, you know, describes the state of If that describes, it's coming with been in the works, but I do other things in white paper. Right there are I think very new, very novel and let's get into those. I think that's also where most of the discussion has been so interchain allocator, right?

That's something that I think before this white paper, probably hardly anybody's heard of you know that wasn't may be directly involved in the creation of this. So what is the interchain allocator? And what's the idea behind it? I'll come up with it from my point of view which is Is when we started Cosmos everybody was like there was this ongoing there, you know, the most common critique of Cosmos and the atom token was the technology stack looks amazing. Like this seems like and like

you have product Market fit. I'm on Builders like lots of teams like want to build on you. Why does the Adam accrue value? And so you know, even from like the very beginning when you know polka dot basically, forked the white paper, they were like okay, we're going to have scarcity. The pair of chain options, that's going to be aligned incentives, between like the security layer, the beacon chain rare and the application layer and my immediate criticism of

that idea. Was well, no one who is a really great Builder is going to pay to join your ecosystem. They're going to like like Sovereign, chains will exist. You will be able to build outside of your ecosystem. Like you're not going. You're going to adversely select out the best builders for doing that. And we've constantly struggled with hey, like what would make what overcomes adversity? Like, how can you align an asset with an ecosystem without introducing adverse selection?

And there's a second problem, which I would say is going on in the cosmos ecosystem, which is we want to figure out a way of generating revenue for the cosmos Hub to pay for the Budget and pay for, you know, the ongoing development in the ongoing Rd and all of the stuff that isn't generally. Basically like printing you tokens like that is genuine cash

flows. And so as we've seen as sort of defy, took off over the last two years, we've actually seen that both Mev and some forms of yield like providing liquidity, especially in stable, coin assets, can be it's reflexive but like, Do represent real cash flows and not just, you know, people buying speculative Assets in the system and so the question has been okay? What we need to be able to do like the fiery, the architecture of growing.

The Cosmos Club economy is having the ability to strike deals with Builders with new Chains, new applications to be like, hey, We want to support your application, we want to partnership between Adam and the application and then we want to leverage that partnership to make sure that Adam holders are getting access to real cash flows that are coming out of

your application. Whether they are transaction fees, whether they are Meb, whether or not there is a source of true quite cash flow, positive yield that is coming out of your system. An example would be like the liquid. Any between a bunch of different variants of ICS secured State data. So, if we have a whole bunch of stinking derivatives that are liquidity pools between them, that is actually like source of real yield and real cash flow. That can be tapped into by

positive in the same way. Like if your originating their state assets and then doing it a transaction providing like best execution as a service by the scheduler is real cash flow. So like the idea is this whole thing is one system but it's basically how do we get out? Stu real cash flow within the

cosmos ecosystem. And basically we think that like no other blockchain has ever really tried in a serious way, probably etherium with some of their economic changes of probably than the closest to try and tap into real cash flows as a way of sustaining the security verb object. But I think we all know that like the Block Chain space cannot survive. If like, that is not the frontier of experimentation. And so this is why I didn't like

the core motivating. Dr. Of the allocator of the allocator is just a piece of this whole system of trying to get access to real cash, flows into the security bunch of customers. Yeah. So I mean to add to that. I mean like, you know, the interchange is obviously going to be way bigger than the cosmos Hub and and already is. And the Hub is, you know, is it is positioned well to lead and Steward the inner chain and to

help it grow. And we've already seen, you know, there's always been a question around alignment between the Hub and and the rest of the interchain we've already seen a kind Natural approach to incentive alignment with, with the cosmos table with Adam holders which has been through air drops, right? And I sort of like the way Zaki framed it in, in his in his talk and some other time I've heard him. Talk about, you know, the

allocator. And what's happening, there is like air drops are a kind of informal off chain, you know, way to do incentive alignment, but we've seen a lot of them, they've obviously, you know, created a tremendous amount amount of value and bootstrapping within the ecosystem and very, very Ways to do that.

And the idea behind the allocator is to actually, you know, formalize that Better Built Tools around it, make it something that can be arranged kind of more directly to create the incentive alignment and more concrete, sort of political economic relationships, between between different block, chains again, over IBC. Using all the native kind of

cooling. We have governance functionality, IBC, functionality, and and other kinds of modules to be built to actually, you know, enable The Hub to, to help grow the whole inner chain and build something that's, you know, that continues to be. Larger much larger than itself, right?

So the Hub as sort of being seen as something that helps initiate this thing that is stewarding this thing and can remain somewhat incentive aligned with something that is, you know, whose goal was to be much, much bigger than it. And and, and ultimately ultimately kind of successful on its own. And the alligator is a way to sort of, you know, help continue that process.

That was a bootstrap with with airdrops, but to become more formalized and something that could start to be, you know, reasoned about and more more sophisticated ways and could build out, you know, additional kinds of products and infrastructure and offerings, that can help change that are booting up or that are, you know, entering new phases in their life cycle, their leverage, the benefits of the Hub, you know, to help them sort of Go off into this into this

thrashing, see of the interchange One of the things that the paper talks about is the talks about the structure for funds to be distributed through the allocator. And so I think this is the thing. Maybe that was the the least understood at least I went to reading the white paper. It wasn't clear, like, how this would work. And I think the thinking around this has also evolved in the last couple of weeks since it

was announced. So, can you give us an example of what do you think when the alligator is deployed? And There are funds in the treasury and those funds are meant to be effectively allocated, was this going to look like talk about, you know, the these councils and this community council and how is that governance got process going to work and what are the assurances that Adam holders have that funds are not going to be misallocated or Miss spent.

Because I think that's been one of the main criticisms of this is the fear of Miss, allocation of funds, and things with things like that. Yeah. I mean the goal is to is to be setting up much more mature governance processes, right? And that's something we have to do together, that's something that's going to have to be architected between core developers. Adam holders community members, you know people who are, who can oversee oversee funding. There's a lot of work happening.

For instance, on the ICF side. Now, to restructure things to, you know, we're setting up the TA be the technical Advisory board. We're bringing these bringing folks together to try to match. Chur the, the funding process and we're using new language to describe the commitments we make

to each other. The promises I was crew follow up on things and and so there's a lot to mature there and we want to bring a lot of that on chain as well and the reality is it's not all entirely entirely specced out yet it's something we have to we have to figure out together over time and to get started you know were the The Proposal is to have some you know, concrete things we can do that.

Include some limits, include some checks and balances as a way, you know, to start kicking things off. Right? Because we have this situation with the cosmos that we have, you know, we have a community pool. It's very small in the in the grand scheme of community pools. And there, it has funded a few things that have been actually quite successful. But it hasn't it hasn't funded core development hasn't funded.

It's kind of a little bit of core development, but not, you know, not really not really much in the scheme of stuff being developed for the Hub and it hasn't really funded larger larger projects. It's starting to with Prop, 72, and funding. Some of these interchange security projects. And that's the sort of kind of success. We want, we want to build on and, and build structure around, right?

And so the idea with with who, with the council's and the sort of assembly structure and and the new issuance is to take all that off to actually start having you know, more sophisticated on chain governance. And so, you know, the new updates to the white paper have a little bit especially with the new Charter that sort of being drafted, you know, has a sort of more detail on what those constraints will be and how governments can start to Work in

a, in a more, sophisticated way. Yeah, and maybe just briefly. If I can, sort of, maybe a little bit of a simplistic description that like, I would make of this allocator ideas, like right then the community pool, we have like funded some things, right? There's been some funding for like different chains of different projects or I bought. This has been like small and and also the decision making process

like doesn't work so well. Write like having this everyone vote on it is. I mean can work well, but doesn't scale well. And did you deals in is problematic? And then, you know, you have a proposal. You can just vote. Yes or No. But like it negotiation doesn't really happen, right? So, like the way I do, I feel like a simple wave my eyes would describe is okay. We want to like do this at the largest scale and then also create processes and, you know, decision-making were.

Yeah, but you have, are you able to make those decisions? In a better way at a higher scale leveraging, people's expertise better. I think that's I think that's basically right. Yeah. One way I've heard this described as Juno subdues like similar structure to Juneau sub tabs where the sub dials are tasked with allocating treasury Capital to individual projects. And so we could see a future where there are multiple kind of councils, these are effectively Dow's.

These Dows have some amount of money that they can. Kate on projects that is within this Dows particular expertise,

right? So it could be like there could be a doubt that's funding core infrastructure, open source software, the Dow that's funding like conferences and maybe those are Dau. This funding people doing marketing and producing videos and there could be another Dow that's funding a specific type of like you know, like funding Dex's or defy protocols or you know, similarly to see the kind of ecosystem of dows that we we seen on aetherium but only the,

a lot of them, most of the funding would be coming from from the treasury from the allocator, does that sketch out a little bit of the vision for what? This might look like in the future. Yeah, I'll say a couple of things like one is on its head like we want to move more of the bureaucratic, like the process. And like essentially the bureaucracy of growing, the cosmos of maintaining the cosmos Hub into the Cosmos on itself.

Like this is this this vision of the cosmos hub, no longer serves the masters of the ICF and aib but it serves it becomes to the master so that's like one piece I would like to like a little bit dig a little bit more until I've decided these ideas that are in the white papers of like allocator Dows and Covenants and

stuff like that. Because one thing though that we want, like the Souls to be a doing, and the is like one aspect of it. Is this idea of going out and like what essentially running like a strategic initiative, or like a long-term incentive aligned developed like growth plan for some application, right? Where you're like, okay, like we're good at like this is a more complex deal. Like we're going to like this much governance token is going to be distributed to stagers.

This much, governance token for your application is distributed to To the treasury. We you are scheduler at able to chain like like organizing and managing. Like a much more complex deal is something that the like Covenant idea sort of floats. It's like the Hub can really do Partnerships, right? Like one of the biggest challenges has always been another challenge that Cosmos as is because we are so decentralized.

Like how do you partner with the cosmos Hub has been like white people will come to us and be like, hey, we want to do a partnership with Cosmos more like High We Do. I have a way of doing that. Like, there's no one to talk to. We're just like, you do a partnership as polygons. Are you do partnership an avalanche.

If we have this mechanism, if we have this Council mechanism, there will actually be ideally councils that you go and talk to you and be like, hey, like we actually have a procedure for doing this. We've actually structure a long-term economically incentivized alignment with the cosmos at the atom holder. So that's one piece.

The other pieces is we do think that a big piece of this stuff is going to be just, you know, an allocation that probably should be small in the Getting but is just going out to teams to go out and try and you know maximize their revenue and maximize their ability to you know maximum profit in a long way so that there's essentially like a REV share back with the treasury. So you're like go out.

So like we're going to allocate funds or get people who participate in those systems are going to have to essentially like Bond as like a surety Bob, their own liquid state assets, their own liquid state atoms, you can think of this as a Form of like leveraged investing where like or like where the cosmos Hub is essentially like an LP and a fund. These are all like Trad five terms.

But like these are this kind of model is a way of actually going out and like doing a little bit more looser a little less centrally planned growth by just picking teams of people and and like encouraging them to go out and find the best way of sort of of generating value in the ecosystem.

Not again here. I don't know if there's I guess there's been some discussions about this, some concerns about this, especially when it comes to, you know, how does this decision making work and is their accountability and control and like anything. That's, of course, totally

understandable. Since is like, it hasn't been done before I think we're the most most discussion is actually been, is in, I think, in a few aspects are like, you know, related to this allocated all Laughing or but not exactly it. Right? So one is the question of how it is being funded and to the question of the magnitude of the funding. So the in the in the original paper and I think this has been modified a little bit. Now, there was this idea of a pink pudding.

Well, I guess first of all, right, there's some some fundamental economic changes are also being proposed right where they amount of atoms. Being issued is going up a lot in the short term and with most of this money going into the treasury. At least, this was the original I paper and and then it's going down and basically the staking rewards going down dramatically and and then in total I think there was something like fifty six million atoms.

If I remember correctly, that would go into this treasury in the next three years. Yes, but again, I think there's been maybe you guys can talk a little bit about like, you know, what was kind of the idea behind this, the thinking behind it. What is the feedback being and what are the modifications that have been made so far? So at a high level, the thinking behind it was, you know, let's correct.

The position of the Hub. Having a pathetic size treasury in the form of the community pool by, you know, by a large mint into into the control of the atom holders that would give it a treasury that is, you know, competitive.

Largest treasuries in the market so that, you know, put a ridiculous number in, and, and initiate a conversation about what people think and that's where that's where the white paper started and that was very effective for, you know, actually starting to have that car.

I will also say that part of the perception was is if you meant a very conservative amount like one of the goals of the out of my paper is to move to a more credible policy around issues, if you meant a small amount, no one will perceive that Mentis. Your issuance was credible because they will say, oh, you will you were just Mythic a small about and then you will come back for more and like where does this end, right.

And so a big part of the of the intended messaging or which many, I think a lot of people appreciated but it's the Optics of around, it didn't win. Maybe as precisely as I was expecting that like, the idea was like a largemont over three years. It's just supposed to last you till the end of time, basically. And then That gets you out of the basis of much more credible monetary policy.

The revision is basically realizing we're the communication around the intent of this went wrong and basically saying okay so it turns out that like from my point of view Adams that sit in the the custody of Adam holders and are the same thing as atoms that are not minted, that could be minted by Adam holders, but I think we've gotten from conversations with lots of people in various And the forums and various chats that like there's a significant subset of the population of out

of olders who view these things really differently. So like atoms that don't exist don't exist and atoms that are mentioned that they that are held by at holders do exist in some sort of conceptual way and there's a big difference between these things. So it's great, like, it doesn't matter, like we can just wait, we introduced the trenching concept, the tragic cause that implements the kinds of controls that we always anticipated being in the charter.

We never anticipated. He do a deployment Of 50 million atoms into the into the economy, anytime soon. But, you know, like we learn from the from how people interact with the communication, and I think the charter and the updates to the white paper. Now, more clearly communicate the attend. Well, getting to the same point, which is communicating to the market, that atoms are intending to move to a more credible lower rate of issuance.

And that like we have we have sort of upper bounded the expected issuance In a way that the market can then set expectations room. Yeah I mean I do these in my eyes you know, kind of mean Bucky's himself. Right. Okay. The community pool was being kind of like, you know, very small and and I think that was one of the maybe mistakes in my

eyes that was made. When I think generally, like the Adam economics, in my view when Cosmos was launched was really good and has worked very well and I I do feel. There was one thing that should have been done differently, which is, I think the community food should have been larger. And, and I think if there had been a much larger community pool, then I think they would probably also have an early writer this, some organizations, like, how do we use this now,

effectively? So I also feel like here, okay? They like the obvious thing would just be like, okay, it makes sense that more money is deployed and there's like ideas for how to do it and structure to be built.

So why not just I don't know like you know, I was writing Streetside why not - put At the community pool at the moment to percent of from patients going there and put that to 20%, Which I think would be much easier to for everyone to understand to accept this like, okay, it's also easier for like it, let's just say, cuz Okay now my taking words going down by 20% but it's going there, which kind of makes sense like, so yeah, I'm curious

like why not this path? And maybe talk a little bit about like they did logic behind this. Monetary changes that You know, going Beyond just finding their the allocator. Right? Because that's one thing. But that's that's not the only thing that's happening here. Yeah. I mean, you know what, we're not trying to do is make a few little tweaks to the cosmos Hub to just like move forward a little bit, right? And, and sure there's lots of

little tweaks. You could do, you could, you can tweak the community pool, you could, you know, make some small proposals for this or that we wanted to do was come out with the material upgrade to the hub's political economy to set it up for this new, this new phase of the cosmos project, the integration. Face right where the Hub is going to be you know, a steward and a leader within this wider interchain it is going to support the growth of that inner

chain. And and it's going to work towards being able to you know, actually make a meaningful intervention into the to the global monetary system in the long term. I mean that's that's kind of the goal of this all is more sustainable monetary and

financial system, right? And so sure we could we could tweak we could tweak some small things but we wanted to have a more material upgrade of the governance structure of the sophistication of decision-making and that was the idea behind behind putting forward the treasury. And so, If you just minted stuff into the community pool and kind of didn't do anything else, then you're still sort of leaving it

up to, okay. Well someone has to come along and build organizational structure and figure out all these things and so we wanted to kind of put those more together and say, look okay maybe minting you know, 50 million atoms in toe into one undefined spot over. The course of three years is excessive fine. You know, that's great. Let's keep talking about about what to do. I think there's General alignment that there needs to be more sophisticated on on chain

governance. And that's, that's really what the treasury proposal is all All about. And then it's more a question of actually How We Kick this thing off, right? And so and so, the new proposal is that okay, rather than just some consistent issuance into the treasury, you know, over three years, it'll be broken up

into tranches. It's up to Adam holders to vote to have those tranches, actually, enter the treasury pool, maybe one idea, which would be, which would sort of be a, you know, a compromise between all these things that would actually maybe help kick things off a little better is to have the first tranche go into the community pool, right? And that might be able to allow things to get started more quickly, right into the first tranche, you know, ends up in

the Any pool. Now, we have a community pool of say, you know, 45 million atoms, but future tranches, are minted into the treasury and the idea is that gives the community pool. The initial kind of Runway to get make sure the treasury is set up in a way that it's comfortable minting into the treasury, right? Because the whole point of the treasury's that we set up more sophisticated sophisticated governance structure to actually oversee to oversee funding and and so on.

Right? So you know, something like that. I think I think we make a lot of sense but just tweaking the community pool tax. I don't think it's efficient. Because it doesn't say enough about the actual, you know, larger scale governance changes. We need to actually set up more sophisticated, decision-making coordination. And, and so, totally, I mean, I, I do recognize that I think those governors changes are

needed, right? I think my, the way I could, I would imagine that was more like, okay, you know, the community pool is increased and then there's a proposal right to the community pool saying, on. Hey, now I don't know. This 5 million atoms in this community pool. Now, let's move. Like I don't know, two and a half million atoms to this, you know, governance structure control that can, then maybe line with like, exactly what's described, which I think we'd also give a sense of like Adam

holder. Still feel like in control, right? Because they will have to vote on like the money being moved from the community pool there and it goes through this familiar process that that people know. Yes. I think I think what I would be proposing is that the structure is that the initial tranche goes into the community pool?

Ooh, and we could do that, you know, as soon as we can get an upgrade to have the community pool mint and but the the commitment is that future tranches are going to go into the treasury, but it's the it's the out of holders that vote. They actually have to pass a vote for those tranches to get

unlocked, right? So the first tranche goes into the community pool, the community pool existing governance, you know, has to deploy it to get the treasury built and they have to deploy it to get the treasury built in a way that they will be comfortable with future tranches being minted directly into the treasury.

And then, of course, there will be, you know, and as for the charter there, Ways for Adam holders, to get funds to flow back from the treasury into the community pool into the distribution module, and so on. But that way we sort of, you know, set things up with the expectations at like.

Okay. We start out of the community pool community pool funds, the creation of of the the Treasury System and then future tranches go into the treasury but require, you know, an Adam, hold their vote to actually to actually create them and that way, you know, beyond the first crunch, there's nothing else created. But there is, you know, the the sort of commitment that future things can be created by the atom holders in this in the somewhat. Predictable kind of segue.

I think that would be a really nice. Kind of balancing of all the interest of would give the out of holders control, complete control over the initiation of this thing, but would, but would be a credible commitment to moving towards a new system. You know, that they actually have to take responsibility for funding the development of you know, up front and that way we kind of balance all the the interest I think quite nicely. Okay. But that like the sounds reasonable.

What this doesn't answer those that this this idea of like, No, decreasing the issuance in this way. That's proposing the white paper right? Where it's basically goes up and then goes down a lot over three years and then and then basically goes to put sort of like minimal issuance. Okay. So this is a separate question, right? Is the, the question of issuance just Acres right?

And, and, you know, right now, you know, the reason the issuance is the way it is, is with this exponential thing is, is to balance this tension between security and In liquidity in the, in the token, right? So you need some amount steak. And so to ensure that there's some, you know, some high amount staked. We have this x exponential issuance model that data just to sort of, you know, ensure that that's taking stays around around two-thirds, but with liquid staking and you know the

those Dynamics start to change. And what we don't want is just exponential issuance forever because that's, you know, is unstable for various reasons. Ideally ideally, the Of the computation for security is actually coming out of the conversation for the security provided by stake. Adam's is coming out of the things that are being Securities. Not just coming out of, you know, unsustainable it sort of infinite exponential issuance,

right? And so the idea is that the drop-off in issuance is more than compensated for by, you know, proceeds from interchange security and the scheduler in the allocator, and all these sort of things. What is perhaps missing is a way to more directly tie those things together. Right? So, you know, maybe in And some Ideal World.

It's like, well, the issuance drops off in a way that is directly compensated by, you know, new flows from interchange security and, and so on. And if it's, you know, if it's not well, then there's a risk because it would, you know, if they could make a commitment today to say, okay, lower issuance great, you know, take the money out of our pocket, but we don't, you know, interchange Securities, not live. Yet, we don't know how, you know.

So, so that's the kind of thing we have to, we have to navigate that and the, you know, actually building out a system where the issuance drop off is, you know, commensurable who the new value flows kind of directly in. Glee is is quite complicated and you know, so we didn't we didn't propose doing that but there's still quite a few levers that Adams takers can can control on how this is going to happen on when the issuance drop off,

we'll start on on their ability to actually take funds out of the treasury and redirect them back to the distribution module to compensate. There's also the matter of if, if, if there's not enough issuance and people on steak, then once staking drops below the 2/3, It then then the exponential issue with kicks in again, right? So, there's a few different ways. There are few different levers to kind of navigate this thing.

And I don't think we have, you know, the full picture the exact mechanics here, but there's a number of things that can make this work to allow the whole system to move towards a world where the compensation for security is actually coming from the system being secured rather than just from exponential issue at the mat sort of the overall goal. We're working towards the think is, you know, sound and unnecessary the question, are you know, the details on how we

get there? There's a collective focus of the mind that is required to get to among many different stakeholders in the cosmos ecosystem and in the cosmos out of itself. If we really want to get to a world where we are securing the system by a cash flows, like I think the like the cash flow there. The cash flows appear to be out there. Like there seems to be enough desire to build stuff on top of the cosmos. Hub on top of interchange security that we could plausibly get the cash flows.

Like Mev is plausibly large enough you know as an across the block chain space, like there are enough new assets coming in, there are enough things that could, that could potentially generate the amount of liquidity.

So if he believed, if we attempt to go for an exponential growth of the cosmos ecosystem which you know, a lot of sort of, you know, investors in the box and space are I think is a very large possibility and like hundreds of millions of dollars of capital have been committed to this as a thesis, if we believe in that as the cosmos Hub and we sort of focus, the minds of Kosmos Hub stakeholders on saying, hey, like this is a really important opportunity to make sure that we capture those

cash flows into the cosmos Hub, we end up, we can end up in a really strong position around and Adam as an asset that then like is the driving force for this change in the political economy, rather than just another old coin. Yeah, one of the things that struck me here is there's a question that no one's asking here. And I mean, like, these are, these are great ideas and I think there are, it's great that we're debating them and it's great. That there's a conversation

happening in ecosystem. But you know, the questions, no one will question. No one is asking is what if Adam holders are not up to the task? What if this doesn't work? Like what if we decide that? Hey like, we need to relinquish control of that. Like the ICF and sort of these organizations need to relinquish control the Hub to the Adam holders. But the in fact, in fact, the atom holders are just not up to that task and fail miserably at

doing this thing, right? That we're talking about here. Have you guys given any thought to that at all? I think a lot about that lately. And I have a very straightforward opinion on it, which is we always built Cosmos as a way that could succeed in like, the cosmos ideas could succeed without Adams succeed, right? And that A little bit of that is a big part of the core goal. And the vision is like we should take, we should take bigger risks with Adam because Cosmos as the bigger idea.

The inner chain, as the bigger ecosystem is not somehow solely dependent on the success of Adam. And so, therefore, Adam should should take higher to take a whole bunch of risk. Try to become something truly amazing, potentially fail knowing that the core I'm that we've constructed the, you know, F bows, osmosis Juno a gorik, and like.you know, and Umbra, and anoma and Beyond are all independent Locus has of power and energy, and are all going to

be running parallel experiments. And so, if the atom experiment, does not does not succeed, all of these other experiments might plausibly is exempt. I certainly, this is certainly Adams, curse, right? Blessing and curse, is that it created this thing that it's that that doesn't actually need

it to potentially succeed. Now, I believe that that that Cosmos the inner chain, you know, will be have much more probability of success with a strong, a strong chain committed to upholding the values of The Wider interchain.

The way the way the cosmos up is that that's position to be, you know, a sort of long-term ERM chain that stable and and simple and follows the kinds of principles that were laying out for its development of using interchange security to extend functionality and so on. So the idea isn't to go and take, you know, some, some crazy, some crazy risk with with the Hub or, or, with the atom, but that's not to say that the system can't evolve and that it can't evolve in both ways,

right? And, and that's what we're proposing, is a bold way for the, for the system to evolve, not, of course, to set it up for failure, but if anything to set it up for, for success, in this new role, in answer to Leading and stewarding the energy, And like, any Endeavor, of course, of course, it might not succeed or might not succeed, you know? The way, the way we expect when it comes down to, you know, this problem of our, the atom holders up to it, right?

And people talk about it or decentralized governance and all this kind of stuff. This is something we think about a lot. And and you know, from my experience, the thing that matters very significantly is building sound organizational structure, right? And you know, people like to throw doubt and say oh well just have decentralized governance and you know, Nothing will work and you pay a bunch of lip service to decentralization. And you know, that's not, that's not a real thing.

That's not how we're going to actually, you know, materially move move the bar on on decentralized governance.

And what's interesting about the position, the cosmos Hub is in it, you know, kind of uniquely in the world, certainly the world of in the world of blockchains is the level of decentralization around the core, the core Development Group. And the requirement that they actually figure out how to how to coordinate and work together to build this thing and build the organizational structure and the institutional structures. To do it all.

And so it's not just like well throw it all up to the Adam holders and you know, let them figure it all out without any kind of support or institution building. The entire exercise here is to actually construct political Economic Institutions that can carry this thing forward and and and it seems like we're doing it in a sort of deliberate and, you know, constructive and thoughtful way. Almost unlike anything else. Anything else we're seeing out

there, right? We're really trying to drill in, on the structure of these things on how you set up good governance on the language, you need to use to facilitate that, you know, what I like about this. What we call the Workflow language that he thinks it's a cult, it might be but you know, every successful thing is a

called. So at some point in its in his life but the point is to actually be very deliberate and not just not just throw things up to the centralized governance but actually to construct, you know, organizational structure and and institutions that can support this thing for the long term. That's something.

You know, we focused on quite a bit informal and something we're, you know, we're building out and in the wider ecosystem to get all these organizations to work together because it's not just about some ephemeral cloud of Adam holders.

It's also about the individual people that they are that are working together New concrete things and the conversations they have and, you know, the commitments they make to each other and so actually, you know, deliberately trying to sue for subsurface all that and talk about it, and cut through the awkwardness of, you know, making promises and commitments to

deliver. And following up on all these workflows is super important, is how we're focused on making this whole thing, a success in a way that's quite different from from basically, every other, every other ecosystem and, and chain out there, Let's move on to the interchange scheduler which is the other part here. And, you know, just a give a high level of The Interchange schedule as I understand it.

So, the interesting scheduler is a mechanism by which actors in ecosystem are going to be able to bid on block space. So validators will be able to auction off their block space to Market participants. So it's effectively a block by block space, Futures Market or a mechanism that allows us to Market to them. Are you Walk space more future blog, space Market not a black text based Futures market and so this this will effectively allow Market participants to buy up

that block space. Probably do some some sort of block ordering or like block construction block, building work and reap the rewards of that of that Meed work. So can you explain here? What's the, what is the motivation behind the scheduler? And why does it need to be something that the cosmos Most Hub delivers as of functionality. And the reason why I asked that is, I've talked to some folks who either directly or indirectly told me that.