I'm not bullish on any of them because you need like a very specific set of circumstances to be true for a liquid staking to repeat the kind of success story that it has on here. The first thing to understand about ETFs in general is like they will basically all compete on price. That's why staking ETFs are going to have a big advantage over non staking ETS just because they can pay you right from the rewards like your balance is still going to grow.
It is actually a very good and like attractive product from talking about restaking and talking about institutional, you know, demand. Like the problem from here was like in both cases that the staking setup that Lido gave you was not flexible enough, right? It was opinionated. It was not putting your money in restaking. You were getting the same returns as everybody else.
We're not able to choose. We are not or red eyes and like what mainly we release they use and if they use DVT or not. And so I think the idea of vaults is a very kind of organic one. Create your own staking setup with your own not a radars and then have the ability to mint the liquid sticking token like an RK stake if against that with a collateral ratio that that is based on on that vaults risk
profile. Hello and welcome to Epicenter of the Show, which talks about technologies, projects and people driving decentralization and the blockchain revolution. I'm Brian Crane and today I'm speaking with HASU, who is a crypto researcher and writer and strategic advisor to Lido. Of course, Lido's need much of an introduction, although we will introduce it, but Lido is the leading liquid staking protocol and one of the leading staking projects.
So really exciting to talk about Lido and, and, and some of the evolutions that Lido's gone through and that are upcoming for Lido. So really excited for that. Now, just before we go and talk with Hazu, we'd like to share a few words from our sponsors this week. If you're looking to stake your crypto with confidence, look no further than Chorus One. More than 150,000 delegators, including institutions like Bit Go, Pantera Capital and Ledger Trust Chorus One with the assets.
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It's been 4 year, almost 4 1/2 years, so a long time ago. It's good to have you back on. Yeah, the episode was a long time ago, I think with Kane from Synthetics or something like that, if I remember correctly. Yeah, about liquidity mining. Yeah, when like all of that started, right? It's, it's crazy that like liquidity mining was this topic that like there was a time when liquidity mining was like so new that we had to discuss it on the podcast, right?
That's what it meant. Yeah, it was the stone ages of defy back then when you were still using a, a manual, I don't know, living in a cave, but starting to defy. Right. So how? How did you first get involved in crypto? What's your crypto journey? Yeah, I think the the kind of short version is I was a professional poker player for 10 years. During that time, you know, what started as a hobby and like, you know, an activity where are you?
If you, you know, you were motivated and you were somewhat intelligent, you could make a decent living. Like it became much more, you know, a sport over time, or I would say like a kind of became professionalized in many ways. And if you wanted to to be a top player, you had to work with, you know, what's now known as solvers like kind of type of like chess computers. But for poker, you had to, you
know, build software. You had to study a lot using the software, try to improve your game and I over time I became more and more. You play poker, but then you'd have software to help you decide what hands to play. So no. So you weren't allowed to use any of the software in, you know, in real time. The same way if you go to likechess.com, you're not allowed to use a chess computer on the side. That would be considered cheating, right?
But with poker, how do you check that and is it sort of an honour space? So at the time, basically, you know, the kind of poker so of us weren't really commonplace yet, I would say. And the ones that were out there were like pretty crude. So it was actually not easy technically I think, to even try to get that to work, to use it in real time. Today it's a different story. I like today you can get those things for like, great cheap.
They're very fast. And so, yeah, like today actually, you know, pretty much anybody could cheat probably an online poker if they want it. And that's why it's a big reason why the game is kind of dying. And the the main games are like the biggest games now are played exclusively between people who know each other. And it's like reputation based. And you know, a lot of cases also people just play offline where you maybe you don't have the same challenges, right?
That's interesting, right? That's kind of like maybe general, you know, it's interesting to think about that because with AII guess that's going to happen for like all kinds of stuff, right? They so far had like, humans compete and then you're like, yeah, this is not really work for you anymore. Yeah, I mean, did you see this? I don't know. The other month there was a a scandal about somebody had like invented a systematic way to basically cheat in in job interviews online using AI.
So of course, one, we have this issue like all the time, right? So we have it or first of all, you know, we ask like questions when people apply, sort of like essay written questions. And then I think, you know, I mean, our team is like, ah, this is an AI generated answer. But you know, of course, I don't know how what's the detection rate is here?
And but then I think we've also had various cases where, you know, our team like suspected or, or where clearly people either clearly people are using, you know, live in real time as they're getting asked questions using like ChatGPT to get their answers. But then I think in some cases they're like, OK, that's definitely happening. But then other cases they're like, not sure.
And it's very tricky. Yeah. So I mean, chess had this problem before poker because chess computers existed, you know, probably a decade or two before poker like poker service did. And they have, I mean, they have killed like poker chess that's played for money, like to a big degree like that used to be played for money, same as backgammon. And those games got basically solved and like cheating became too easy. And so, you know, the trust problem was basically insurmountable.
But there is, there are also forms of chess. It's called Centaur chess Centaur because you know, it's like, you know, the Centaur is like half horse, half human, right? And like a Centaur, a chess is basically like half human, half AI. And so it's the idea that, you know, you can have a IS compete with each other. You can have humans compete with each other. But if you throw like a human and an AI together, it's still a challenge, right?
Like, you know, to beat another human and another AI in combination. And so it's the idea in a lot of ways that, you know, yes, like a IS will play a much bigger role, but like an AI that's somehow bundled with a human or controlled by a human will always be more effective than just a human or just an AI. And so that's the case for chess that like human plus AI beats AI. Yes, it actually did. Yeah. Like because I mean, there are many cases where I don't know
how it works now, right? Like, but in in in poker, there were many situations where the AI was actually completely indifferent between choosing like one of two or one of three options in a given situation. And whenever something is close, I think human intuition come, you know, can play a pretty big
role. Also AI like depending on how good the abstraction was that basically the game was solved on because you you know poker is too big to solve like the full game quote UN quote like you have to make a simpler game that is kind of an abstraction of the bigger game. Then you can solve that, but then you have this abstraction step also back right. So because they, you may in the solution, you see like, oh, I'm supposed to play this situation
in this way. But like, if you're an expert in, in, in solvers, then you know that the AI probably never got to look at this exact situation. This is only part of like a bucket of like 1,000,000 similar situations that it, it's all grouping together. And so you know, if you are, if you know these things, then you can add a lot of kind of intuition and like nuance on top of maybe what the AI is already disgusting. I mean, that is, I guess the great hope we all have, No.
Is that like somehow, you know, we'll be able to like leverage or merge and cooperate with AI in ways that, you know, we can amplify what humans can do and and you're not just become made redundant by the computers. Yeah, I think so. Right. And this goes back to what we were talking about in job interviews and so on. I like to the degree that we're still trying to test human capability, I mean, we now need to test like human plus AI capability, right? How good are you in working with
AI? And I mean, the, the most obvious thing is like the things we test for can become much more complex, right? Like much bigger in scope, right? You where previously you would send someone like 5 questions to answer, maybe you now give them a much more expansive work test that that fully acknowledges that. That is a great point, right?
Maybe one way to go would be, or maybe that is the inevitable thing to go is that you say like, hey, we're going to do this interview and you explicitly are allowed to use AI and then we're going to see. But I don't know, it's tricky one too. I guess you'll have to totally redefine how the interviews work. Yeah, yeah. And I mean, you can even include, you know, let me what you use AI or like documents, you know, give me, give me your, your prompt history, right?
Because even the way that like somebody talks, I'm like, OK, so I, I like a lot, a lot of people I know are saying, I mean, I'm, I'm not a manager. I'm, I'm more of an IC, but I used to be a manager in the past. And I think the way that you manage people, especially more junior people, is very similar to basically how you would prompt an AI. Like I see a lot of parallels.
And I think a lot of my friends who are managers saying the exact same thing, they really see very little difference between like how you correctly prompt an AI and how you, you know, you delegate a task, for example, right?
And you know, that is a thing that you, you know, first of all, like humans are going to get much better at delegation, I think, and, and management as a result of having an eye because all of us have like, you know, 1000 junior employees if we want like from now on. And you know, you, you can test those things, right? Like in the past, it used to be actually pretty hard to test someone's management skills in
an interview setting. But now you can, you know, you can have a real kind of simulated management relationship even just by looking at someone's prompt. History is very interesting. Yeah. OK. OK, very interesting. But let's come back to the top. So the crypto question, so you're playing poker and then. Yeah, so I was playing poker, but I I realized over time I became, you know, fell more in love with the studying aspect of the game.
You know, this way of like working with solvers, but like, mostly like thinking about the game and talking about the game with other people and kind of like unravelling it. You know, it's mysteries and, you know, finding new ways to think about it. And, you know, I was always part of a group with other people and we were kind of coaching each other and I was coaching and some people.
And, you know, I realized that this coaching, this like studying and coaching aspect, like I was much more motivated by learning and teaching other people than I was at some point by competing. And I knew that, you know, when I'm done with poker, I want to do that full time. I don't, I didn't know what topic, but I knew basically the form factor that that activity would have to take.
And when I, you know, later found crypto, I like crypto was always kind of maybe a little just like rights outside my, you know, my orbit basically. So that I knew a bunch of my friends were already like buying crypto since 2013, 2014, you know, making money and dabbling with like trading. And also we were using it to send funds back and forth
occasionally. When I then started to actually look into it, I very quickly fell down the rabbit hole and then decided that, you know, this would be the thing that I want to spend probably the next at least decade of my life on. And you know, I, I already knew what form factor I wanted that
activity to have. And so I for the first couple of years, I only basically focused on studying crypto from many different angles and write about it, tweet about it, make a podcast about it. And luckily it turned out that poker, I would say, sorry, crypto is actually uniquely well suited to such an approach just because it's so complex and so
interdisciplinary. You know, you really need to kind of understand a lot of different aspects ranging from economics, politics, law, computer science, game theory, like the you can look at this from so many different angles and always find like new interesting ways and lot of good insights come from putting those different perspectives together.
Yet crypto was still so new as an industry that somebody could come in from like totally kind of the outside and you know, just by being a generalist, you know, catch up to whatever is the frontier of that industry or then maybe two years and then start making net new contributions to the industry,
right? And I think when you come into, I don't know like math or physics or real like certain really many that you even AI probably like come into many other industries, you won't be able to do that. What were the things maybe before Lido that you know, the the rabbit holes you've been down on that where you, I don't know, like got you most excited or obsessed? Yeah, in the beginning I was very focused on Bitcoin.
I thought this was the, you know, the main thing to understand first, which is send me down, you know, the rabbit hole of, well, what is money? You know, what is how does it work? What is banking like? I, I could tell that there was some truth to, I think what Bitcoiners were saying about maybe money in the banking system, but also there was so much stuff that they were saying that was like simply wrong, right?
Like I think all of the ideas that Bitcoin people have about fractional reserve banking and like all of that stuff and Fiat money in a lot of ways is it's just like completely not true. But there was the kind of interesting, like they were right about some parts. I mean, the, the relationship between like government and, and money, I think was, is like one good example of the way that money can be weaponized and, you know, or like used to control people and societies.
And so I thought that there's, you know, an interesting connection here, But I think I, I mean, I quickly ended up thinking that Bitcoin competes much more with gold than with the dollar. Yet at the same time, there's like a hierarchy of money in, in, in on which like both gold and the dollar also exists, right. And so it was kind of for me that was a very like formative, I think couple of years like just like getting, building up all of these mental models to make sense.
And you know, Bitcoin for me was very interesting. Like I, I could see the value for sure. And once I did, once I had that part kind of locked down, it was more about like, OK, how does it actually work? How is it, how does it evolve? Like how does it evolve? How is it governed? What are like the social systems kind of on top of maybe the technical system that is
Bitcoin? What if we what if we have, you know, we have this model of like how Bitcoin works, but what if we play it out 10 years into the future, 20 years into the future, How does it change? And like for me, if for example, the idea of Bitcoin security model and the the block subsidy that that is going to run out. That was like a very clear, like that wasn't even a long tail risk. There was just a fat tail risk, right? That for some reason was like illegal to talk about.
Yeah, that's still something that worries you a lot when it comes to Bitcoin. I, I think it does, I mean, it's, it now worries me a bit less than it has not be. I mean, fees are still very low on Bitcoin, but I think now that Bitcoin is starting to have a bit of a layer 2 road map. And you know, we, there is actually, we're starting to see some reasons why people need to use the layer 1, you know, maybe for DA may, maybe for settlement between different layer 2.
So I think it is at least easier to envision that that transaction fees at some point like there is enough kind of an economy on top of Bitcoin that, you know, you don't have to worry maybe so much about that. Yeah, yeah, it still bothers me as well. I do think it's a big kind of thing that people Bitcoin just, I, I think it's also the sort of software. People talk about the risk for a while, worry about it, but then they're like, is there anything
actionable you can do? I'm like very hard right to do anything and then you just sort of forget about it. And then you ignore it, right, Because it's like, well, the risk was discussed, you know, it didn't go anywhere. So then like no point to sort of like people aren't interested in revisiting that discussion. So I, I feel like now it's really, I feel the only time when this will become a big topic is when it's actually when there's actually real security
issues. Yeah, I, I actually thought the other day I was asking myself if I have become like more jaded and like more, I don't know, less kind of willing to like push for big things in crypto. Because when I, you know, when I was new to crypto, it's very much like, Oh yeah, the security budget in Bitcoin, that's clearly a problem. Let me write, you know, like let me tweet about that, like and write articles about it and go on podcasts and discuss it with
everybody. Like seek out people to discuss it with. Try to lobby for not even for changing something in the beginning, but like for getting people to agree that it's a problem. So we can have a discussion about how to, how to address that. And I was, you know, there was like an uncomfortable time, right? But also like in time of basically like extreme growth.
And now, I mean, I, there are still of course like things that I would change in crypto, but I, I was wondering if I kind of still have that, you know, same maybe energy and like this confrontational energy is why, right? To kind of go out and, and, and like just single handedly push for like something to change. And yeah, it was, it was a kind of interesting, maybe look in the mirror. So, you know, maybe it's time to go, maybe go back more towards that. Yeah, of course.
It's so hard to make changes right when it comes to some of these things. How did you get involved in Lidl? Yeah, I mean from Bitcoin, Bitcoin at this very simple scripting language, you couldn't, I mean, I, I'm not very technical, but it was clear to see that you can't do very much with it, right? Like when you're in Bitcoin, you don't have much maybe have an appreciation for what Ethereum is trying to do in the
beginning. But for me, the time when I started to really pay attention was maybe about like 20-19 when some of the first Defy apps started to launch. And for me, that was a sign that wow, this is really interesting because you know, this isn't just a, a kind of fork of, of Bitcoin that's maybe doing like some things differently. This is really adding a new dimension to what crypto can do, right? The idea that you can build smart contract platforms, you can have these decentralized
smart contracts. And this is in some ways it's like it's super set of Bitcoin, right? Because like you can like any token can exist. Like a token is just a a smart contract, right? It's just like a smart contract account where people have like, you know, balances, like like, you know, signatures and and balances, right? And so, yeah, that for me that that was really eye opening. Kind of you see those defy apps.
And at this point, I think I gradually started to spend like more and more of my time looking at the theorem and looking at Defy in particular, because all the prior research and like education that I'd already done on, on like how finance works and money and those things for me, I think for me, Defy clicked much earlier than for other people because of that then because I had done that education in Bitcoin.
And I mean, you still have like just I locked on Twitter yesterday and, you know, there was like a threat from like a top tier VC who was like talking about how we can bring like algo stables back and like, whether this or that hasn't been tried. And it's like this just like extreme misunderstanding of like how banking works and like how money works. And, and I'm like, yeah, like, you know, sometimes you don't,
it's hard to appreciate. Like, you know, what do you what do you know, or like how how that's not, you know, you shouldn't take that for granted in that sense. So I didn't. So there's like a lot of people even in like Ethereum who don't know even like the first thing about finance and and and so on. And like we are I think we are still like early in in kind of understanding defy and
appreciating that. And yeah, so like more and more defy happened on Ethereum. And then I think at this time I was, you know, you had George us on the show probably a couple of times as well. Like we were very close back then. He was still, George was still living in Europe at the time. And we were working very closely together, writing like a lot of research articles and doing kind of just like explorative stuff in the theorem ecosystem.
We were very, you know, when this was before IEIP 1559 happened and we were very focused on topics around MEV and, you know, transaction fee mechanisms, which also like grew out of my interest toward transacting fee mechanisms in Bitcoin and how if we maybe change that, we can change the way that like, like how much fee revenue can be raised from people transacting, right? And so it was very natural for me then to ask those questions in, in Ethereum.
And I gravitated a lot towards this EIP 1559 proposal, which Vitalik had made I think already like 2 years before. And it got, but it, it didn't, you know, he never really pushed for it. It didn't really catch on. And so it kind of laid dormant. And then there was a kind of push to revive it and bring it back.
And we were like, we were doing, I think some data like simulation based analysis about that and writing articles about it. And, and you know, one of the topics that we were interested in was basically staking push because Ethereum at the time was, was about to switch to proof of stake or like proof of stake had been in the works for many years. But that was one of the things
we wrote about. We wrote an article about kind of staking pools and like the difference between centralized and decentralized staking pools and staking derivatives. And we basically concluded that in Ethereum there was like a really good set up to create a decentralized staking pool in between and like for this staking pool also to have advantages over over centralized staking that would kind of give
them a leg of an adoption. And between those staking pools, you had a rear, or at least we thought you had a rear kind of winner take most dynamic because you could introduce the staking derivative that could itself become a building block for like other things and like be used in other, in other Defy apps and so on. Because, you know, like, even like tokens themselves, I just like, you know, have liquidity effects and network effects and like, and so on.
We thought that basically because taking derivatives are going to be when I take most, that means that staking pools would also be when I take most. And yeah, that article was very influential at the time. And we why I mean, Paradigm was already an investor in in, in Lido and I connected with the Lido team over that article and we got to talking for a couple of months and, you know, maybe like like half a year later, I became an official advisor to the team.
Yeah. I mean we were also correspond. I think we started talking about, you know, like liquid staking idea in 2018, right, like right when you started it. I mean, it's such an obvious idea, right. And then we were, I think we did built the first like liquid staking thing for Cosmos in like a hackathon in 2019, I guess. Yeah, also a long time ago now. Then we wrote this big kind of paper on, you know, the risks and how to do it.
And although it's kind a little bit focused on Cosmos, actually, I remember we were also thinking about Ethereum a bit at the time. But we were like, ah, withdrawal thing, like how can you do it? Like, you know, that was one thing, of course, then the having the kind of multi sig initially or, you know, if the threshold signature was like and and then the other thing was like, oh, but the LDO, it's just like looks a lot like a security in some ways.
But I think in the end, in the end, I think the choices, right? And but then of course, we were very involved like as well, right, and like launching it from the very beginning. But I think in the end it's also something where we kind of saw a lot of people were much more conservative back then in terms of regulatory risks, right? And I think we've kind of seen that. Yeah, just the the winning path of, I think I've also been just, you know, go ahead and do it
right. And you did an ethical way and try to have decentralisation and be honest and stuff like that. The the right level of risk in business is almost never no risk, right? You know, there's almost like a form of controlled risk that you want to take. And I think what, what I mean, what matters at the end of the day is that, you know, you, you do stuff that like, let's just look in the mirror at the end of the day.
Yeah, there's like so many things you can do that are risky, but that are also unethical. And that's like things you can do that, you know, maybe are risky, but not, you know, in a way that you hope is going to become less risky over time. And also that, you know, you have no problem justifying to yourself because there's no other people getting hurt from that. Right? Like it's like net good for the word, I think so. Yeah, I think that's definitely
one of those examples, yeah. So of course in the beginning, right, Lido, yeah. So there was basically kind of like a multi sig in a way that was later removed right when they started having withdrawals. So, you know, smart contract controlled. Yeah, The the the the problem was that like, you know, the, you had the separation between the, you know, the beacon chain and the kind of the regulation
the chain, right. And so the beacon chain, you were not able to own a beacon chain validator with a smart contract yet because the beacon chain did not, I think, like support, support smart contracts like the technology didn't exist like you only EO as could own could control these like beacon chain validators. And so the best you could actually do here was a kind of like MPC is secured like multi SEC, right? You can do a smart contract like that was added only later. Yeah.
And then so in the beginning, right, so it was basically that. And then you had five validators was the initial set and you know, people could just deposit their EFF, get staked EFF and you know, it had a huge amount of traction. I think probably the, I, I mean, my views, there was like 2 big reasons for it. Maybe maybe it was a third little bit of a reason, but I think the biggest reason was the
withdrawals, right? So where you basically you had to stake you if and then you wouldn't be able to unstake it until actual the merge happened, which you know, you didn't know how long it was going to take, could be 3 months, six months, a year, who knows, right? So of course, huge amount of uncertainty and then no native delegation, right?
So Ethereum, I think I mean, my view, Ethereum is a kind of an example where the staking design, the system staking design was a bit of a failure in some way from the perspective that like it was designed around the idea that people will run their own validators at home and no in protocol delegation. And I was just completely ignoring what people actually want. And then Lido kind of built the thing that people actually want, which is just a simple thing where you can just take any amount.
So then I think Lido really right, We saw also even today, right liquid taking on Ethereum, there's like way, way, way more adoption than on any other chain I think for. For these reasons, like, I mean, I've seen so many different liquid staking protocols launched. I mean, every chain has like 3 to five different liquid staking protocols. Like even chains that have yet
to launch, right? Like this, there's like 3 different liquid staking protocols on Monad and that's like 2 on mega eve and whatever, right? Like every chain has them. And I'm not bullish on any of them because you need like a very specific set of circumstances to be true for liquid staking to repeat the kind of success story that it has on here. And you know, one big one was basically the fact that like if you staked it was taken was like a one way door, right?
Like the merge ended up taking, you know, how long did it end up taking? Two years, right. Like I think it was like locked up for two years. Yeah. Yeah, I think so. Or maybe like maybe it was 18 months, right. But like, I think the, the like most optimistic estimates were like around 12 to 15 months, right? So, you know, and like the conservative ones was OK, you know, maybe it's like 2-3 years or even never, right. So like you were taking, you were taking a risk.
And I mean, the risk wasn't was less of the problem was like the discomfort from basically locking up your money for a long time. And so the two solutions to that were exchange staking. They offered you a derivative, then you, you at least you could sell the stake position inside the exchange, right. So maybe they could also issue like the derivative on chain and you can also trade it etcetera.
But like exchange taking like we were very anti that because we didn't want like exchanges to play like exchanges are already the most valuable players in the crypto ecosystem at the time. And we thought if they also control, you know, the the chain itself, like, wow, that's really bad, right? And so, and the other was staking in multiples of 32 EVE by like, you know, maybe Eve was like one or two K or whatever at
the time. Maybe it was even higher, but like it was like 50K plus to stake and you couldn't stake in like lower increments. That was very bad also, right? And so I mean, those two things were basically those were like the golden ticket, right? In the sense like why a liquid sticking fuel would do so well on Ethereum? But like, like all liquid sticking ratios are super low on like virtually every other chain other than EVE. Like even Solana it has like 1% or 2% like liquid sticking
penetration. I think it's a bit higher now, but. Yeah, it might have increased like since I last checked. Yeah, but it's very small, like it's not really comparable. I think that was like a good, I mean like both are necessary because like otherwise everything would be captured by exchanges and like and like a good environment for Lido to launch into. I would say yeah. Yeah, absolutely.
So when you think of Lido and the history of Lido, what are the main, the main evolutions in the protocol and the main, the main changes that have been enacted since the launch? Yeah. I mean, I think, I mean the launch itself is interesting. I would in in some sense I would call it like the progmatic age, right. Like the V1 is like all about pragmatism because as you were saying, like yes, like there was a small number of not a radars and the tokens were controlled by Moody sick.
And like it was all basically for technical reasons, right. Like you couldn't do, you couldn't actually control like we can change that as with a smart contract yet. And like the baseline also at the time it was people that's taking on exchanges like because people didn't want to lock up their funds for two plus years, right? They, you know, they wanted some liquidity at least, like all of the big capital debt, right? And so I was like, is this better? Is this better?
A, is this better than like staking on on an exchange? And B, does it have a path to decentralization, right? Like those were the two questions that that Lido was asking itself. And like it made all of the the right choices that that that were like very pragmatic choices as well. That kind of you needed to balance, you know, growth and, and like hell for Ethereum because you don't, you didn't want the funds to end up on an exchange and, and, and like path to decentralization.
I would say. So then when I think 2 years later, like the merge happened and this allowed, you know, lighter then also to that withdrawals to the protocol I think took took maybe like a couple more months for that than to happen. And I would say Lido has always been on kind of 2 tracks. You know, 1 is basically, you know, serving users and like making the best possible product. And the other is about decentralization. And it was always about
balancing these two things. And so the the first track thing in a lot of ways is what about simplicity? You know, like let just like click 1 button and like have me, you know, stake my E for you, like give me give you the most rewards, right? And the other is I think, you know, also like integrations liquidity. So you can actually with a token that you get in return, you can actually go and and use it, right? Like you can borrow against it in lending markets.
I think that really was the biggest thing like unlock unlocking, making making like state state E on the beaten chain, turning that into like a collateral asset like unlocking the collateral value of that just made made it so much more valuable. And this would later. I think this this like track like of just like making the best possible product for as many users as possible. That would then I think motivate like V3 as well as we're going
to talk about in a minute. The other track was always about decentralization. And so having like a really good note operator sets, having like we always like growing the number of node operators that stake is distributed across, making sure it's Geo distributed, it's client distributed. All of the node operators are falling following like best practices around how to run their staking setups and like, you know, make sure that nobody's ever getting slashed. So it was a a big deal.
And then the other two are kind of making withdrawals permissioners. So the idea that if you if you actually hold any stake Eve, you can always go to the protocol and you can redeem it for Eve and nobody can stop you, right. That is that is a that is a big kind of North Star goal and one step towards that is like going to be triggerable withdrawals. So that's, you know, I think that was added in the last half Rock. I think a theorem. And the other one is dual governance, right?
So the idea, I mean, so first of all, you need you need a way for like someone to programmatically trigger withdrawals from the beacon chain in the sense that like the Notre Braider with the fans are delegated to, you know, it's just getting ejected. So they have no way to like stall it out or something. So that was important. And the other was for people to be able to withdraw without governance having any way to
stop that. And so that is the idea of dual governance and the dual governance is an upcoming upgrade to Lido where, you know, anywhere basically staked E4 does have a way to escalate and like freeze the the governance system when they think like a contentious proposal is happening. And that gives enough time for everybody to withdraw. And so, you know, it's the, you know, it's what this really gives you as a state guys, you
can always withdraw like that. Nothing can happen in governance really like as long as you assume that like a small number of parties is paying attention to act in time and then the protocol can be frozen and like everybody can withdraw their money. And so that that would then basically make withdrawals entirely permissionless, which which is a huge deal. Yeah, because probably not all listeners remember this or followed this back then, But for a while, Lido was very controversial.
So I think there was different reasons for it, right? One was that Lido ended up getting very big, getting up to about a third of all the EVE stake was in Lido. And so of course people are like, oh, if there's more than 1/3 then. And then I think the other big concern right here was that you had the LDO token, which the governance token of Lido protocol. And so you of course had like, oh, well, if now we have all this eve that's kind of, you know, controlled by the LDO
token. And then, you know, maybe the LDO token or they could like do something to, I don't know, control the protocol extract value. So of course that was never really never a risk I would say in the sense that it wasn't the Lido philosophy or values or goals. And I think Lido is very conscious, right of these concerns, right. So I think then the dual governance kind of.
Yeah, I mean it, I wouldn't say that it it wasn't a risk like I think the risk never materialized like it's not, it's not. So I mean. It's not 0 risk. Yeah, these two things are related, right? Like, I mean like the fact that Lido control, it's 1/3 of ETH. I mean, what does control mean, right? That's that's the big question. And so the, the reality was that ADO could really exert some amount of control like over the, over the stake, right?
Like it couldn't really control like the hundreds of node operators that the stake is distributed to. But it could with some reason, like it could, for example, prevent people from withdrawing at the time. Like if that's if that's a proposal that like you want to make and that passes like the vote on chain. And so it's really like the question is, how do you fix
those holes, right? And like a very big part is like kind of neutering the ability for IDO to make any decisions that would actually be bad for users and bad for Ethereum. And so I think then, you know, there's that that that like a tech factor becomes closed. You know, that said, like even people like on the lighter side, or I mean, there were many
people. This was a thing that the community was very divided watch right, like because even like many people who weren't working online or were in favor of like not self limiting the growth. And the reason was that the other, you know, the alternative, like self capping was also seen as risky. Like it had its own risks, right? And that was the idea that if the market really is like, if the market for staking derivatives really is we're not take oil or we're not take most.
And if like the good guys basically like save cap and like the bad guys don't, then you just end up losing, you know, the entire market, right? And so that was I think a big kind of rationale at the time. And I think we're like fortunate that it didn't play out this way, but I don't think it was a given, right? I think we we ended up seeing that like the demand side of the market ended up fragmenting more
than than we thought. And then that led to like a basically like a fragmentation on the supply side as well which we will we can get into. I know. Do you want to talk about institutional staking or Lido V3? Maybe we go to Lido V3 first? Yeah, we go to V3 first. There's one more thing on like I have on decentralization, which is the other big North star.
There's like, you know, having a good node aware set, having permission of withdrawals and the the 3rd and like final one is having permissionless node operation. So not just the ability for people like for stakers to join and leave like permissionlessly, but also for note operators to do the same thing. And you know that that is basically like happening also in major ways as to community staking module that made, you know, sticking permissionless
and it's slow. It's it's like slowly being scaled up. There's also like DVT distributed technology module. Just the idea that you have, if you have, you know, let's say like you know, you have like a multi sig of five and you have like 3 notabators in that set who are either curated IE like secured by reputation or like CSM validators, IE secured by a bond. Then you can just add two more, right? And they, you know, they can't control the validator, right?
Like they can, you know, it's like another way to like make it so that people can join permissionlessly, maybe with like an even lower bond or secured by like a smaller amount of reputation. But yeah, so just the idea that like you can make the protocol more permissionless over time. And also the way that like stake is routed across these modules becomes basically like more and more automated over time.
Yeah. So I was saying before 1 staking derivative didn't end up winning, you know, didn't end up growing, you know, to to like the majority of the market. And that was because it turned out that, you know, there were, you know, at the time staking was seen as like, well, one staking set up is like the same as every other staking set up, you know, So then liquidity became a real differentiator and, and integrations and, and, and, and that kind of stuff.
But as it turned out, you basically saw two big trends. And one was the rise of re staking. So the idea that like people were were staking like they wanted to like stake the eve on the beating chain, but also then they kind of stake that very that again and some set up where they were maybe earning extra rewards and Lado did not participate in that. It was like seen as not in, you know, in the values of the protocol to do that to kind of take, you know, to rehypothecate people's stake.
And you know, it basically gave rise to this new to new protocols that that did that, that ended up like taking more risk, but also paying more rewards. And I mean mostly or like not mostly, but like it was entirely fueled by kind of inorganic growth incentives. So we were, we're talking about liquidity mining in the
beginning, right? It's just like all liquidity mining in the sense that there's nobody actually using, you know, actually using that like that stake and is actually paying any like organic rewards. And there's also no slashing or anything. So, you know, it's just purely like building the supply side, paying people points and ultimately like Aglaya tokens, for example. And you know, that ended up soaking up a lot of ETH and a lot that this was like a big use case that that lighter didn't
serve. And the other was like more institutional forms of staking. So I think as, as like more and more like institutional players decided to come and do crypto, What he ended up seeing was they had different often times, you know, either like risk management, like more internal based or like more regulatory, IE like external based kind of constraints and desires about what they wanted to do.
So for example, if you if you have a, if you have a constraint like you need to know the Noto writer you're delegating to and you actually need to have like a pen on paper, like actual legal contract with them, then that was a thing that like Lido did
not surf you at the time, right? Aside from of course running, you know, Lida validators and we started using N as a few or so while ago now, but I think there was one very elegant design was to stake wise design and to stake wise design basically allowed you to have different vaults. So you know, we can have, we could have a public vault that people Safeway for. We could have a vault just for a particular customer where like no other assets would be.
And then of course, you can have whatever fee agreement you wanted, you know, you could decide or different maybe DVT for one or not like you could have one validate or different sets. It was extremely flexible. But then the thing that stake was also allowed you to do was that all of these different vaults and there was no fee from the protocol on any of these vaults, but it it would allow. People to then still mint a liquid second token.
Or as if that was shared across all the vaults and then, you know, for example, Eigen layer added OSC, right? So then you could say, OK, I can participate in Eigen layer, right? Or I could do you know, we we have to small now where you can do leverage staking, right? Where you can basically take the OSC, put it in all they bore against it and loop it. So like that I think was a very, very elegant design and that I am, I think, also inspired.
Yes, absolutely. I saw the same way that liquid staking had been around like 2-3 years at least before Lido launched. Like the idea of vaults I think is like is, is similar. I think a lot of people in, in the like liquid staking space or staking space in general, you know, have been having like the same idea or like, you know, roughly the same idea, but it wasn't the same priority or like timing. I think for everyone.
I think that stake wise, you know, I think they definitely have, you know, great products and you know, it's it's a very strong, I would say inspiration for for lighter V3 because so if you, if the, you know, if we kind of from talking about restaking and talking about institutional, you know, demand, like the problem here was like in both cases that the staking set up that Lydo gave you was not flexible enough, right? It was opinionated, right? So it was not putting your money
in re staking. You were getting the same returns as everybody else. You did not were not able to choose who we are not the red eyes and like what mainly the release they use and if they use DVT or not, right. So it was all like one big pool. And so I think the idea of what then to kind of put that like on top of what lighter already has is a very kind of organic one in in the sense that you when you have that, you've already explained it perfectly, right.
Like a word is just, you know, it's the idea to like create your own staking setup with your own valid with your own not abraders and and then have the ability to mint the liquid sticking token, like in our case, stake Eve against that with a like with a collateral ratio that that is based on, on that vaults risk profile. And I mean, I would say that there's a big difference still between like vaults and Lido and
vaults in stake wise. And it's just like staked EVE is like just like 1000 times or whatever, like more liquid, right? Like that is that is like a big difference, right? And so the ability to to be able to min the most liquid and most integrated steak and derivative that that is that does make it like a much better product. Yeah, absolutely. Of course.
I think where Steak EEF is absolutely no doubt by far number one right, is in terms of liquidity for Steak EEF and integrations in, you know, all kinds of places, but you know, I guess especially default protocols and yeah, for sure. So that that is something where it's a very compelling offering. So now basically what that means is anyone or like, can you
explain to us how it works? Can, can now anyone go and create a vault or is there some kind of like commissioning or, you know, only certain parties or how, how does that thing work? And, and then also how does it work with the, the collateral ratio, right?
Because in the end, in the end, right, one of the challenges is that in Lido, you say like, OK, we kind of managed to risk by, you know, through all these ways, right, through the distribution, through vetting node operators at at least for the curated set. And now if people do their own vault, you don't really have control anymore about what they do. Yeah. So anybody can create a vault. Like a vault is just a kind of
immutable primitive. A vault has, you know, someone who can put like the stake into it. It has a note operator that the stake is then going out to and being staked with. And you can also have a curator. So very similar to like how it works maybe on like more four and like, you know, the new like generation of landing markets, you know, a void kind of a kind of a curator that's like setting like the parameters of the void and like you. Can have one or or or or multiple.
Node operators I think, I think 1. So did you ask about node operators or curators? Node Node operators. OK, yeah, I think you can have several. I think it's like, you know, up to you. So what? What a void doesn't have by default is the ability to mint state DEF right? So that that is you need you're basically starting with like 0% collateral ratio like you're, you know, you are. Your void is like able to mean like 0% worth like stake if against your the collateral
that's that's in the void. Or maybe it's starting from some low ratio. I don't know like the exact details, but you know you can. You basically need like permission from the ladder dial in order to be able to mint the stake Eve. I think it's working the same way in in in stake wise as well. I think all everyone can mint OS even stake wise now, but I think by default it has. It doesn't allow you to mint the entire amount, but yeah.
That's exactly what I mean. They said like a very, yeah, they said like a very conservative ratio. And I think that's that's how it would work as well, probably in in Lido. Yeah. So by default and say what I think every vault can mean, I think 95% and then some vaults, I think it's actually just of
course one vault. And the Genesis vault, they have some special like, OK, it has to get to a certain size, it has to have some survives token collateral, has to go through governance and then they can do 100%.
Yeah. And I'm the the way that I would like encourage people to think about that is like modulus in Lido, like right now stake is coming in and then there's a thing that called a stakey router and it's like giving basically, you know, the right to like mint stake eve against that Eve two different modulus, right. And like that distribution function today is, is permission because it's necessary for risk management like that.
They are, we have ideas for like automating that in the future, kind of like moving to kind of a policy based type of governance. Like governance only sets the policy, but the policy isn't like implemented automatically. And you know, this is another, this isn't technically a module, but it's like, it's like a module in the sense that like the, the Dow sets, you know, risk limits basically for, for vaults, like vaults as a whole.
And then can set like, you know what, what types of vaults like you can get, like what type of collateral ratio, like what is their, their minting abilities? So that's very important. So that basically will mean like someone creates a vault. I don't know. Let's say of course 1 creates a vault or someone else gets a vault and then you want to allow this vault to mint OSF against it. You will go through the Light of Governance process to get vaults whitelisted for this. Or approved.
I mean, in in later Dow, we're not fans of like making these like very like low level decisions. So I think it more likely there's like a governance vote to unlock a certain amount of like overall wall liquidity to min stake. If maybe like, let's say like initially like 2% and then 5% and then 10% right of all stake outstanding. And there's like a committee, like a risk management committee that is basically then charged with like allocating that that capacity to different wards.
So I mean, you know, if you, you know, if that would be your touch point then as well. Like if you're a correspondent, you're launching a ward. And what's the timeline on the Lido V3 roll out and are there different phases to it? So yeah, we are in a in a pre launch phase right now. So I mean, right now there's like a kind of simulated way to
do vaults. It's like not technically the vault, but it's like kind of like a trying to simulate that through like off chain refunds and like giving you some ability to do custom setups for like the actual V3. And like we're like also working with like many different parties right now, basically like and getting them ready to to kind of adopt it when it goes live. And like the actual V3 launch is going to be in summer 2025. S in in in maybe like 1/4. Cool. That's very exciting.
Yeah. And I guess maybe that ties in a little bit with the institutional stake inside, right. I mean, I think that ties certainly the whole thing about, hey, I want to have a contract with my node operator, I want to have an SLA like all of that stuff of course becomes possible.
Then I guess the other big thing is ETFs or kind of sort of products that are traded in their traditional financial world, but that represent underlying safety theorem where I think redemption is a big issue, right? So they're basically they generally have to serve redemptions like you know, T + 1. So someone says I want to get my EF out, they have to send it the next day. But then that's a problem, right, because the E form bonding period is much longer than that. So then depending.
On the size of the exit queue. Yeah, exactly. Yeah, I mean, as you're saying, right, Like so first of all, between like ET, like non staking ETFs and staking ETFs first, like the first thing to understand about ETFs in general is like they will basically all compete on price. Like ETFs is like a, you know, an ETF is like a commodity and like commodities compete on price. Like Brent plays some role, but you know, not that much and so.
That's why a staking ETFs are going to have a big advantage over non staking ETS just because they can, you know, like a, a, a non staking ETF like actually needs to charge you like a fee, whereas a staking ETF they can actually pay you right from the rewards, like your balance is still going to grow and they can just like charge a much more like invisible kind of fee from that. And so I think it's like it is actually a very good and like attractive product.
And within the set of staking ETFs, you're basically competing on how much you can stake. Like you, you want you, you're going to maximize like your returns by staking as much as possible. And that in turn is controlled by the size of the door or like how many doors there are, right? And so if you're if because you need to be able to, as you were saying, exactly right, like you need to be able to serve the redemption requests when they come in.
And when you, when you use like native staking, right, just like go through, you know, just put your money directly on the TM beacon chain. You basically have like one door, right? Like the door is the exit queue from the beacon chain back to the execution layer. And so that door, you know, you don't really know how big it is. Like it, it's, it's like, it's sometimes it's like, you know, can move a lot of money through, but then other times it's
clocked. And very often it will clock at the exact time when you like, don't you, you, you need it to like not clock, right? Because everybody wants out at the same time for the same reasons. And So what staking the derivatives give you is a second door next to the smaller like official door. That's like a back door, right? And so that's the idea of, you know, you can't just, you can't just unstake your EF to the
beacon chain. You can also sell your stake the EF to willing buy us in the secondary market. And those buyers, especially if the stake EF is trading at a discount, they have all the reason to wait to hold it on the balance sheet and then maybe redeem it like a week later or like 2 weeks later. Like that's like as a near risk
free arbitrage trade for them. And so you can expect that the like size of the kind of second door, the like secondary market is a is going to be a really good way to kind of exit your like expand the total amount of exit liquidity that these ETFs have available and just allow them to stake more and thus charge like much lower fees. And so that's why using the exact riot staking setup is that is that is, I think you know, that probably is going to be like deciding between winning
and losing for these ETFs. Yeah, absolutely. Absolutely Anything else you want to talk about with regards to institutional staking? I mean, we are, we are in advanced stages of discussion, I would say with all of the major ETF issuers. And yeah, I think it's, you know, it's going to happen like at some point, I think Lido is in a really good position because nobody else can offer like the size of the door that that stake Leaf can.
Yeah, absolutely. So maybe we can do a final topic a little bit and talk a bit about Ethereum more generally. I think there has been perception over, well, I would say state of crisis, right, a bit in Ethereum. I mean, for one, you've had Ethereum actually perform pretty badly as a asset for a while, right?
So it's out massively underperformed Bitcoin massively underperformed Solana for a few years now you've had the sort of crisis big questions around all the L twos and is this value really go to Ethereum and what makes Ethereum valuable? And what is Ethereum in the 1st place? Is it the world computer or is it this kind of some sort of digital gold like money, a bit like Bitcoin and like? And then how should the Ethereum Foundation work?
And. And now you had the leadership changes at the Ethereum Foundation with your executive directors. And so actually speaking with a lot of VCs in the last months, I felt there was a really widespread bearishness on Ethereum. How do you feel about things? Yeah, I think I tend to like not get so overhyped and things are going well and like mostly focus always on like the negatives and when when everybody is like dunking on a thing, I try to see more of it's positive.
So I think I think I'm more from my character. I'm more of a like flatline, you know, in that sense, like emotionally. And I mean, I think in this, in this particular case, it's like a positive because I, I think the theorem has never been like, like that downbeat. Like, I think it's like people were, were saying a very often, I think like price performance comes first and then people are trying to backfill like a narrative for why has it, has it
done poorly? I think this is there's probably some some effect here like that, well, that's like some something is performing poorly and then people are making up a narrative for why that's the case. And that narrative is very convincing to other people. But then also seller who
reinforced the narrative. When you just look purely at the fundamentals, then like yes, like Solano has caught up to Ethereum in some of the metrics that matter, but it was also leading in like many metrics that matter. In your view, what is? I don't know if you have like I know one or two or maybe Max 3 metrics that you think are most important to look at. What?
What are they? Well, I think it's like number of like number of VC backed protocols launched like on Solana versus like Ethereum plus layer 2. So I think would be my this, this is a very big one. I think TBL is another big one. That one's hard to fake. Like those two, those two would be pretty big. And then maybe deck something like decks trading volume maybe because I most care about like finance financial. Activities. Cases, yeah.
The thing is like when you, I think people are like looking for, I mean, I'm coming from the MUV space of course. And so and like, I mean, so I know that like in Ethereum we see actually like MEV, like MEV becomes basically protocol revenue as like proposers option of the right to order transactions in the block. We, we see that as like a, that's almost like a negative indicator for like how well the
chain is doing. Like if that number is very high, it means there's a lot of MEV, it means a lot of users and like market makers and stuff are like are basically getting the their money extracted from them. And it's, it's, it's a super bad UX and it's, you know, going to make people like not come back, etcetera. And so we have worked very hard for like many years to build an MVV supply chain where people don't get front run, they don't suffer like there were.
They don't want sandwich, they don't get like they don't pay like this, their Max slippage tolerances and for apps to build, if we have the tools and the knowledge etcetera to build, you know, MEV resistant applications and stuff. And then you're like in Solana in a lot of ways. It's like totally like the wide W like Ethereum, like four or five years ago, where like every user is getting sandwiched in like almost every trade. Everybody's paying their Max
slippage. And you combine that with these like coins and like use cases that are extremely speculative, right? Like meme coins where, you know, if I have a very short time horizon, I know I'm buying this thing to sell it like today or tomorrow. I don't care about as much about my execution, right? So in this case, I'm fine paying like a 5% transaction fee or like a 10% transaction fee, even in some cases because it's so volatile, you know, and my time horizon is so short.
And so, and I think when you look at that, it's it's just like like extremely, you know, first it's bad because it's literally like money taken from users, but it's also extremely unsustainable because a chain that has this level of MEV extraction is, you know, never going to be able to scale to like use cases beyond the ultra like short term. So I'm not saying like the problem won't get solved because I think it will like the, we know the Jito team pretty well.
Like they are very like they are aware of all of the problems and they're like very sensible and smart. But I mean, also like the revenue numbers that like Solana stickers and like Gee do I'm making are like they're not good and and they're also not sustainable. Yeah, for sure. I think that's definitely one place where here is far ahead of Solana and where I think they're still a ton of work to do to make the whole transaction supply chain and MEV more kind of, I don't know, reasonably
managed. Yeah, I agree with that. And I think the the maturity of the D5 ecosystems also something where I think Ethereum is still far ahead. Yeah, I mean, that's not even. I mean, it's just like by, I don't know, buying something on Solana the other week and like the I mean, the exchanges are on like a different level of quality, but like not in a good way. I mean, there's like, you know, I'm, I'm very used to like Salat, like using Kalstroke, for example, like only here.
I'm like disclosure. I'm I'm an investor, but just like I'm also like a user and like the idea that, you know, I can have multiple solvers compete to give me the best execution. My trade siamed protected, I can pay my gas fees and like the output like all of that stuff right, like it just doesn't exist right on Solana and it's
like not a good experience. Like I know people that say they love the UX and I think the wallets are, you know, the like Phantom wallet is a, is a, is a good UX, but it's just like in terms of just the basic, just like getting the basics of Defy right beyond new crunch trading, I think they still have like some ways to catch up and, and framed a different way, like I think the maturity of the Defy ecosystem, like All in all, Ethiom is still pretty far ahead.
Yeah, I agree with that. But to come sort of to this point about, you know, the sentiment about Ethereum and the performance as an asset, what do you think it will take for this to turn around and for Ethereum to again be something that, you know, grows up and creates excitement and you feel there's momentum and people like bullish about it and they want to buy more of it. And like, whoa, whoa, what does it take? What does?
It take, I mean, so I think the same way that like narratives to reinforce like snowball and reinforce themselves on the downward, they do so on the upward as well. So I mean, the way that you would expect us to turn around is like people are really, you know, they're really just like fed up with Ethereum and you know, that's like bad news can't really face them anymore because all they expect is like bad
news, right? And so it takes like very little good news to like make people slightly more positive at some point and then like, you know, you can have a kind of snowball in the other direction. I think that's very often like how these things work. So you can try to make up like, OK, we need like fundamental changes, but very often days are like a cyclicality to these things that shouldn't be
ignored. I think fundamentally like the leadership changes at the EF, I think that that was good. Like hands down, I think that Ethereum has been a like, I mean, if you have this research LED in the sense that like it has very long road maps and like things are in discussion for a very long time and it's trying to have a very decentralized
development process. It's also research LED in the sense that like the court apps and like the EF researchers are, they are the ones driving the road map. And for a very long time, like industry involvement in that road map was seen as not desired, right? And like, you know, you can have this at a time when you're the only chain, but when you're competing with other chain ecosystems for the same developers, at some point you need to start paying more attention to the ecosystem.
And like, I mean the D Phi people can tell you like everybody building in D Phi can tell you like at least one very bad experience about like working with AEF in the sense that like they have been there. Either they are like very dismissive of like the thing you're building in the sense that like I love italic, but also like his word carries a lot
of weight. And so when he's like maybe writing that he doesn't like defy or he thinks that like, you know, crypto shouldn't be used for that and he hopes that there would be other use cases, etcetera. Like it, you know, it feels very dismissive for like the people working on that, for example, right or another is like when they have ideas for all the protocols should be improved because they, you know, it's their users, right?
They know, you know what they get like a million support tickets for every year and like they know what they suffer with. I mean, then and that you try to turn that like into an EIP and you're already meeting a little resistance in the sense that like, are you trying to like Co-op the protocol? You're trying to take over the protocol. Like, I mean that those are like very bad experiences.
And I think those are things where I think you have now the full like recognition that like, hey, that hasn't been maybe so good. And like, what can we do to change that? Like there's a new energy, I would say, and like people getting like the right people getting promoted into the right positions, like including the two new EDS and like especially Tomas from Nethermind, he has built and like a very like large and successful organization in in nether mine. And they are very commercially
minded, right? Like it's amazing how they have built a successful, very big, successful company on the back of creating an Ethereum client, right, Which really you shouldn't be able to like commercialize that, right? But they have managed to like they're not making money through the client, but like they have built everything around that. And to me that's like an extremely good sign. Like he has extremely deep roots in industry and knows all of the
builders. And so I think you, you're seeing a new kind of energy around making Ethereum more commercially open and commercially minded. And I think that is if there was one thing that I would change, then it would have been that for sure. And so and we're seeing that. So that's very positive for me. I agree. I agree.
No, I think I think that's, that's probably one of the big thing is also just a sense of like, you know, core development moves a bit faster, more programmatic, you know, tries to I think I think some degree of faster scaling. I think it's an important one too. That is the other thing, yeah. I mean, if you listen to to apps, then yeah, you would have scaled the layer one, right? Like so there's a kind of related, but maybe it's still
worth talking about separately. But I think in terms of road map, like I think there must be an that there is now an understanding that like you shouldn't give up on the layer one. Like I mean, a lot of what makes greatest incentive for roll ups to build on Ethereum is the quality of the layer one. It's it's speed, it's finality, you know, it's DA costs and transaction costs. So we need OP codes for Zika verification like stuff like
that, right. And so like there's a bit more of the understanding where yes, we want to have a roll up central broad map. That means roll ups are a big group of customers. So let's think about what they need holistically and a lot of what they need, we can only give them by making the layer one better. And so I think you're seeing a real revitalization also of that
conversation. And, and so I think anybody who's like buying Ethereum is also underwriting the, they are underwriting the thesis that like these two, like the people who, who, who want to push for those two things can basically, you know, breakthrough, like the resistance and like, you know, a lot of the entrenched like interests, like inside these processes and like this bureaucracy that has build up,
right. Because I hear I'm in a very like procedural kind of community where and, and like decision making in a lot of places has historically grown to be very decentralized, for better or worse. And you know, in, in some areas you have like, there's the understanding that like, well, this, like this group of people maybe, or like, you know what I mean, the core core developers are like the main example, right? Like you have the client teams and like client teams decide
what goes into into the fork. And that's, you know, maybe that is like one of the very big assumption that like needs to be challenged in the sense that like often, you know, you know, quite a lot of us do the implementing, but maybe they shouldn't, you know, they shouldn't be the decision makers for what actually goes into it. Because like Ethereum is not the type of protocol where you can have, you can be like an extremely talented engineer, but you can also still have that
kind of like strategic vision and like keep the old protocol in your head and like know what it needs like at what time. Like that at least like the set of stakeholders who get to make decision needs to be like expanded. Cool. I think that's a great note to end on. And I'm also excited to see sort of what this new energy will bring to Ethereum. So thanks so much for coming on House. We really enjoyed this conversation. Thanks, Brian. It was really fun. Thank you.