The biggest thesis back then and even now is that Web 3 isn't secure enough. Facebook wanted to build a stable coin to power Facebook itself. That was the DM leader project. They looked at the EVM, looked at the SVM and decided that it wasn't good enough. So the language itself it's a lot easier to write code. There's actually some diagram that shows like to write account checks for a full module. It takes SVM like 2 pages. It takes EVM like 5 pages. It takes like the movie on like
10 lines. If we ever have more than like 1000 users on chain, the EDM chain simply can't handle load because you're waiting for one thread, what parallelization enables use at multiple threads. So if you have 10 transactions, instead of waiting for E to B to C to D, you can do a transaction transaction B. Transaction C transact D all the same time because you have multiple threads within the VM. This episode is brought to you by Gnosis.
Gnosis builds decentralized infrastructure for the Ethereum ecosystem. With a rich history dating back to 2015 and products like Safe Cow Swap or Gnosis Chain, Gnosis combines Needs Driven Development with deep technical expertise. This year marks the launch of Nosis Pay, the world's first decentralized payment network. With a Gnosis card you can spend self custody crypto at any Visa accepting merchant around the world.
If you're an individual looking to live more on chain or business looking to white label the stack, visit nosispay.com There are lots of ways you can join the Gnosis journey. Drop in the Gnosis Dow Governance Form. Become a Nosis validator with a single GNO token and low cost hardware or deploy your product on the EVM compatible and highly
decentralized Nosis chain. Get started today at nosis dot IO. Cars One is one of the biggest node operators globally and help you stake your tokens on 45 plus networks like Ethereum, Cosmos, Celestia and DYDX. More than 100,000 delegators stake with Chorus One, including institutions like Bit Go and Ledger. Staking with Chorus 1 not only gets you the highest years, but also the most robust security practices and infrastructure that are usually exclusive for institutions.
You can stake directly to Chorus One's public note from your wallet, set up a white label note, or use the recently launched product Opus to stake up to 8000 ETH in a single transaction. You can even offer high yield staking to your own customers using their API. Your assets always remain in your custody, so you can have complete Peace of Mind. Start staking today at Corus .1.
Welcome to Epicenter of the show, which talks about the technologies, projects, and people driving decentralization in the blockchain revolution. I'm Sebastian Quitio and I'm here with my Co host Felipe Ernst. Today we're talking to Rushi Mancha. He's the Co founder. At Movement Labs. There are a network of move based modular block chains. Before we talk to Rushi, just want to disclose that Movement Labs is a portfolio company of Interop Ventures.
But with that out of the way, hey Rushi, thanks for joining us. How's it going guys? Pleasure to be on here. Yeah. So we were just talking before the show about like East Denver and I think this is the first episode to come out after the conference, maybe the 2nd. But yeah, you you, we were both there wearing the movement sweatshirt, which is very comfy. Yeah. What were your impressions about E Denver and, you know, compared to last year? Like how do you think the space has evolved?
I mean the short answer is we're back. Last year it was like kind of dreary cause like post FTX, it was like 3 months after FTX and all the debacles and everyone was like pretty damn bad. If you were there, you were like in it for the like actual long, long term. There weren't that many side events, weren't that many parties, weren't that many like fun things, which is a blessing
and a curse. I think last year we saw a lot more like builders coming to the market and actually presenting some of the cool novel ideas, and there's more signal than noise. And then at Denver there's a lot of signal, but even more so noise, especially with care if the lot rises with crypto and AI narrative. But seeing a lot of those decks flowing around, honestly have had a difficult try to filter out what's real and what's not
real. But more importantly, I think it's like great to see the public, like obviously the market's back. Bitcoin's all time high, price action is doing well, private markets are going crazy. So the excitement's back. I think that was really great to
see. But I think it's important to know like you have to be kind of wary because I think we're heading way too fast an upwards direction, like even before having bitcoin's all time high, which creates a lot of like macroeconomic questions for how long this bull can last as a
supercycle, whatnot. So as like a builder, it's very important to like a focus on distribution, keep like capitalizing the market, but also remaining like conscious that it's probably not going to be a long term thing and maybe so economics is like suggesting it's a short term thing. So that kind of adjusts timelines. I think a lot of different infrastructure companies are paying attention to the markets in terms of timelines for
product launches and whatnot. So that's one side of the story. I think some key to finding narratives, you had AI, crypto, AI obviously like intersection as a core narrative. Obviously NVIDIA is getting crazy right now which trickles out as their private markets and the like. Modularity was still retaining from last year, I think 2023 we still have ADA focused modularity.
So you had like Celestia, Eigen avail And then this year we put out like modular day as kind of the flagship event and really focus on the VM level experimentation. So I moved VMSVM was in VM and a few different groups. I really come to market and explain why alternative CVM important. Let it be sticking out. This is a big narrative that I used to push on, looking forward to launch. Yeah, I I felt like East Denver this year could have been just like modular week.
It felt like every event had a modular twist to it or was either like about modular or had like people giving panels about about the modular thesis and the modular stack and like avail had an event. So I see an event you guys had an event and and tons of other sort of like more theorem aligned teams were were doing events on on modular like how?
How? Important do you think modular is to to the current cycle and in terms of narratives you know like what amount of developer mind share do you think it's actually capturing versus what the markets are saying like what, how, how markets are perceiving it? I think modular is now used to look good in market term. It's like modular alignment where you want to structure a company to be in trouble with other networking systems, which
I think is a good thing. Like if you look at traditional tech or even traditional like hardware, the the the companies that won where the companies are able to build parts and hardware that's in trouble with other E systems that wasn't tied into one vendor lock in. I think that's what we're seeing in the Web 3 where if you're building AI Oracles, rebuilding infrastructure, you wanted to be able to tie to different different chain, go across chain or multi chain and interoperate
because you have a bigger client base, have bigger marketing exposure. So I think modular now is a marketing term where if your infrastructure, if your app, you want to be modular so you can align with different systems. Whereas if it's actually a modular that's yet to be determined, probably not. Honestly modular in this case probably refers to using all DA using experiential different like BM levels. But I've seen like modular be used for like RPCS be used for like even like APIs.
So I think Modular is like a bigger landscape which gives credit Celestia. They've turned their narrative into like a meta and it allows if like a bunch of different companies to align under like 1 unified umbrella. And we'll get into the entire modular stack in just a bit Rushi. But it is your first time on Epicenter, so maybe tell us a little bit about yourself and your background and how you got into this and what what made you
start Movement Labs? Yes. So my background's engineering started cutting. I was 14. I was always interested in distributed systems technology and whatnot, Started software engineering. I worked at the United Health group LED on Prem databases and cloud immigration for a team over there. Got into that pretty early on. Then somewhere across crypto was really interested in all program languages, especially Ross based program languages.
So Kazuwaza and Ross was really exciting to me from there Me and my Co founder group we're both at Vanderbilt University which is a university in the South of the United States. He was a few years older than me but I was playing one of the first dex in app does he both satay the first yield dragger in app does. So we were early move builders, this was August of 2022, so pre FTX back when like things were
better in that cycle. And then we wanted to bring things like we love moving, which I think I stumbled across it because I like, I read like a New York Times article or some like block article where I was like Facebook's doing this blockchain programming language and their new blockchain initiative. And it got me excited because I was always interested in blockchains, but I was always concerned of security and it would ever scale to mainstream
consumers. And Facebook is the biggest consumer app for the planet, and they took a bet on programming and started Move language. So I built the first deck, Synaptos, that ultimately led to movement because we wanted to bring the moving beyond to Aetherium. I get more to the move side, but that's kind of how I got here. Yeah, super cool. Yeah, let's get into the Move
side. So basically Move is a language as you said, created by Facebook to to be more dev friendly, more more secure than Solidity and the likes of Solidity like Viper it's been used for for Libra and DM obviously, but kind of SUI and up to us are the main chains that kind of build on it today to tell us what kind of sets Move apart from their solidity. Yes, I think going back to the root, Facebook wanted to build a stable coin to power Facebook itself.
That was the DM leader project. They looked at the EVM, looked at the SVM and decided that it wasn't good enough. They needed their own infrastructure and needed VM and language that could scale for billions of users as well as provide security front chain. The biggest thesis back then and even now is that Web 3 isn't secure enough.
If I ever want my mom or anyone in my family to use crypto, the biggest thing they're saying is isn't going to get hacked, isn't going to be rugs, and they're like a lot of scams going on and Moo was kind of built to combat that from the smart contract level. So it stops like 9095% of tax factors we're seeing today in the EVM as well as provides obviously for some of the tax we're seeing SVM as well, it's like some so that's kind of the root and origin cost.
And then we kind of bring into like why move. The thesis is a was built by the biggest consumer app bringing a new web to developers over the next two or three years. You'll see suite and app does use their big treasuries to attract consumer apps and consumer builders to bring net new developers to each system. As our language itself is designed to be a blockchain first language the knowledge I could say is like Move is to rust as reactors JavaScript.
If you follow Javascript's history web two it came to market no one really liked writing JavaScript and then React came to market made website generation much easier like you can design custom components. You're like object oriented. Same thing with move it's people don't really like Wagon Rust they like the framework's the top of it. So move the move and the move VM is a framework. You can think of it on top of Rust where you can design modules that are very custom.
You can have on chain events radio track protection, so the language itself, it's a lot easier to write code. There's actually some diagram that shows like to write account checks for a full module. It takes like SVM like 2 pages, it takes EVM like 5 pages, it takes like the movie on like 10 lines as well as you have embedded on chain protection. So you have the move prover at the VM level, which stops risky, stops injure, overflows, it stops all the attackers we're
seeing today in crypto. So it's the most important innovation, security while also being paralyzed. So it touches in the paralyzed narrative block. STM was actually built by app Das Labs, as pioneered by Monad and a few other groups. So think of like the best, the fastest VM and your favorite auditor combined into one VM at one time. The EVM and Solidity in
particular. I mean they are pretty low level and they let you do a lot of things that other programming languages like move don't let you do. So for instance, things like inline assembly or something like move would never let you do this, right? But the reason why it was devised this way was to give developers more freedom and kind of optimizing for things like
gas cost, right. So with kind of this more prescriptive language that move is you are also somewhat tied down in, in you know in in terms of what you can actually do especially in kind of a distributed system such as kind of a blockchain ecosystem. Does this concern you that you can kind of optimize for things as well as you could in the more
permissive languages? I think going back to web to example, like you don't have the flexibility with Reactor via or Angular. It's simply the best framework to build and design websites. If you really want customizations, you can go at like C++ level. You can like Cherry your own kind of Ruby on Rails frameworks that's more designed for specific like mega use cases. I think there's two sets of argument here. A move increases the velocity of production.
So let's say for example I'm a 24 year old kid, I will want I want to launch my own DFA app in two weeks. Move is the best way to do that because you can get to mark quickly, you can write code quickly, you don't have to worry about account checks, you don't have to worry about keep debugging. So it's the easiest way to Sprint on product development if you do want low level
customizations. The movie system's actually working on a lot in line assembly and integrating assembly directly into the Move language. Obviously it's a nascent language. It was launched like a year ago. So there's a lot of fixes and optimizations are happening. But over the next three or four years, I'd imagine that Move also adopts a similar low level support. I think the address team is working this as well as we're looking into as well. We actually look at it at the Bico level.
So you can actually directly write you'll which is like a assembly language directly to our VM. That's part of our text That kind of differentiates it from a person sui. We've made it fully even compatible. So you can take the silly code, do the 145 AP codes and map it to the 54 move AP codes and launch the VM. Between that process, it's we have a abstract syntax tree which enables runtime and SDK to
understand Yule byte code. But also if you are a very talented developer and you want to customizations as a smart contract level and you want to use assembly, you can write Yule directly to the interpreter. No, that's super interesting. I had no idea that was happening. How do you feel about the mindshare advantage for the EVM? Obviously the EVM has been around a lot longer and there's tooling and people know it and there's tutorials and so on.
Do you think this can be overcome by kind of like the the sort of treasuries that Facebook and up to us and Sui and so on put into it? I think it's our it's our PvP. They both exist. If you want to use Lido today, EVM is the best place to use it and will be the best place to use it for the next five years. But the thing with the stance is the EVM however approaches legacy code. It is code that works really well for past use cases when we
have 1000 years on chain. MOV is designed for billions of users on chain. It was designed for Facebook to be on chain, which is why you have parallelization but also you have Security benefits. So it's actually complementary such that that you have the EDF legacy code and legacy software for early kind of web applications. You can think about Bitcoin script still supports, people still use it for various use cases.
But if you ever want to do on chain consumer, on chain social, any actual use case that requires high throughput applications as well security, you need to use a framework like Move. How Move approaches is we recognize the shortcomings of of Move itself in terms of a new language as well as the network effects of EVM and we combine it so we have a MEVM where you have Moves support as well as EVM
support. So if you're looking to deploy, I don't want to chain or like Avi on chain or you just swap on chain. Today you can use the EVM runtime interpreter. If you want to build the next biggest consumer app, you can use the Move STK as well. I think that's the best way to approach next Gen. VMS which is I think a lot of different groups messed up on a lot of layer ones in next Gen. VMS were like this is our program where it's just our framework, it's the best thing.
If you don't use it, you can screw off and then they lost a lot of developers. It was difficult to track liquidity for us. We are acknowledging that EVM still has a liquidity we want to fully support and actually be as ethereal as possible while supporting moving the long term and supporting proliferating its growth. You talked about parallelization a couple of times there. Can you kind of go into what that means?
So in traditional EVM or any other stack, you have sequential processing, which means you have if you have tentative transaction, it's a transaction A to B to C to D So within a given VM, you're waiting for a transaction to finish for one single thread. Typically in today's crypto environment, sometimes it's not a big deal. If you're using Lido like you'll have $5 gas fees or whatnot, which for some of you just for like big whales, it's fine.
If you have $1,000,000 on chain you pay $5 gas fees, they don't really care. But what parallelization enables
use at multiple threads. So if you have 10 transactions, instead of waiting for E to B to C to D, you can do a transaction transaction B transaction C transact D all the same time because you have multiple threads within the VM there was first started with like the block STM process which app has pioneer which is a new form of parallel processing that enables high throughput parallelized threads. Y is really important is for two reasons, a you on low gas fees.
So if you look at near, if you look at Swiss say they had an extra nothing gas fees which is from parallelization. While it took the EVM, you still have a theory in which it's like $50 gas fees. Even layer twos today are pretty expensive and they require layer threes to scale. My thesis is a layer threes don't make sense if you have a paralyzed layer 2 because you can have multiple threads that
can handle and manage date. The second thing is on if you look at descriptions of the best use case of parallelization, every EVM chain went down like to get like seeking saying arbitrary went down 120 GPS. If the if the chain didn't go down like avalanche, it was at like $50 gas fees. Which means that if if we ever have more than like 1000 users on chain, the EDM chain simply can't handle load because you're waiting for one thread. Think about logically right?
If you have a high impact event like inscriptions or game going crazy on one thread and you just swap on the same thread, it's going to cause the gas piece for you to swap to go up. Or if there's a world where you can multiple threads and you have gas fees, go crazy on one thread rather than effect you
just swap. Doesn't affect DYDX, doesn't affect GMX other threads, so you can actually have modularity within the threads itself instead of requiring constant infrastructure upgrades that make no sense at scale. So Long story short, parallelization enables concurrent transaction processing which allows flow gas fees as well as allows for a management of state during times of high network activity. There's a lot to unpack here.
So I think some of these things in the Ethereum ecosystem are being tackled by intense space transactions, right? What's your take on those? I think Intense based tries actions pretty early on. I know Shogun's trying to do something for like the moding system and the one inches also trying to push towards that. The general thesis was that it's like very early stages yet to be proven because there's a lot of
interoperability problems. If you try to get intense between like AEVM chain on one like layer two and another layer two like across is probably the biggest one here. It's very difficult to do like bridging standards and there's a lot of secure assumptions they're making. But I would say I guess in the EBM world intense is another way
to tackle that. But still the fees are generally a high and there's still like just cause like just cause across has intense built to the bridging doesn't mean it can handle high load. If that was the case, like inscriptions would not take another chance.
And so basically when you talk about parallelization, I mean basically we used to have this this idea any here with that I very much hope is going to return at some point with with kind of like smart shards where basically you have where you have individual execution environments with local states that kind of can interact async with one another. When you have stacks that natively do parallelization, how do you handle the state? How do you make sure that you
kind of have one Ledger? How do you deal with security? Well, the thing was that's one of the benefits of using Ethereum's layer too. As you inherit the network security and the valor set and the kind of decentralization, that theorem is already built and you put the move VM on top
of that. I bring parallelization to Ethereum, which is why I think it's very like the vision for Ethereum is actually to bring parallelization to the VM level because you can inherit the security, manage state bloat through the settlement dealers. While you have VMS that can provide performance parallelization, you have like parallelize Evms. Coming now to Ethereum, you have
SVMS Move VMS. This is definitely the rise of these virtual machines, but they're all saying that the AIM is still the best place to manage state and store data. I'll hand off to to Seb here. Sorry for the for the intense inter interrogation here from the EVM camp. No, these are, these are all great questions. I I love it. I was just watching and and really enjoying that whole exchange.
I mean, you know, to kind of bounce back on what you were saying Rishi, you know, in terms of you know, the EVM being legacy code. I sometimes equate DVM and I know this, this analogy doesn't overlap exactly but look at the EVM and salinity a little bit as I do. You know, PHPPHP has been around for over 20 years.
It it is still powering something like 60 to 70% of websites on the Internet, you know, most of which are WordPress websites and Facebook. However, you know ask a college kid today or like a young engineer what language he's building with, like he's probably using, you know like Node JS and React and all these sort of new Web 2 frameworks and
and not PHP. So I, I sort of look at the EVM and Solidity in the same from the same perspective where I think the EVM will continue to power very important applications and D5 will continue to power these, you know, sort of legacy applications that are going to be you know, very, very important to Ethereum and sort of crypto infrastructure moving forward.
But you know as the space moves towards a more modular ecosystem stack new VMS that are better suited for, for that, for that infrastructure will probably prevail in those ecosystems. Is that a good way to look at it? Or is that analogies missing? Missing some parts, no. I think that makes perfect sense. Like a guy could touched on like the EVM has done a great job of boot shopping the initial crypto user base and use cases for D5 but there still is a lot of challenges.
So that's why these all BMS are coming out of our performance, security and a bunch of the different trade-offs to kind of scale existing Ethereum use cases. But like Liquid with with web two is kind of different where you have, if you have a novel new tech stack, if you have a cool new website and you can essentially vampire attack to use this thing like user base and bring it over pretty quickly probably within a two to three month test span.
That's not really possible in crypto because you have
financial incentives. So if you have like building locked up on one of each system, it's very difficult to migrate and essentially take all the liquidity over to a new nasty system which is why it's it's more of like a long term horizon where you'll see liquidity slowly move to Exelana which is why Exelana has been kind of crushing in, it's been steadily growing TBLS was app since we. So we're slowly seeing that liquidity and users can move over to the next 10 VMS but it's
still going to be like a 10 year process probably before the EDM is at least completely challenged. So in the current state of execution environments is you acknowledge the EVM, acknowledge the liquidity benefits it has while try to try to create different use cases for these alt VMS, make sure those use cases actually reach fruition and then slowly work on acquiring the even liquidity.
Once you prove that. I think the two main contenders are this SVM and then move VMA which have a huge eastern backing of from pre-existing level ones and B how specific teams are carrying out on the alt VM2 VM each system. So maybe just like playing devil's advocate here, like what do you make of the fact that you know Barrett Chain is launching an EVM chain, you know, say also is I, I think now dropping Kazum wazum to to favor a paralyzed EVM in in order to, you know
attract more developers. I think they've found it difficult to attract Cosm Wazum developers. You know, if this is all true and if like move and and and so lot of VM are better suited to this kind of new era of blotching applications, why are you know these very large like especially Barry Chain right? There's like large ecosystem play putting the EVM first. I'll take you to the same. Point of view where the paralyzed EVM, I would contend
is not the same as the EVM. It's completely redesigned virtual machine, It just even compatible. You can argue that our MEVM is a paralyzed EVM even though it's a completely different virtual machine. So I think the paralyzed EVM is I would consider also the next Gen. VM because it's a complete redesigned virtual machine. This has EVM compatibility from
the start. There are security issues with Solidity but say isn't really prioritizing that because their go to market is being a trading first chain being a high throughput chain so they don't really care for optimizing for smart country security. So the the simple answer to say example, the modern example is those are completely different EVMS or VMSI would not say their current EVM, they're actually like the Monet EBM. I want to say EBM which is
completely different. So still ties in the next Gen. thesis. And then As for Bearish, I would say that's like the main value prop. There is a community they've done a great job assembling, maybe the most valuable community crypted today. And a lot of their activity is based on this proof of liquidity consensus where it's actually doesn't make sense to use a next Gen. VM because they don't really care about speed, they don't really care about security as
much. They're more focused on using governance and using the liquid staking every staking narrative. But I know for example like talking to the teams and different teams are throughput is a concern for them because even like mempool went down recently, it probably won't be able to do more than like 50 TPS at scale. So it's we're actually going to be working with Birgi and bringing the Movie VM to their system.
Probably more experimental on down the road map, but for any game that wants to launch, a bear chain simply probably won't work. You'll probably need to like get an exclusion for that. Yeah, so therefore. Like Bear chain will sort of act as a a security layer for L twos and and and other app chains that want to leverage bear chain security. Yep cool. Let's let's talk about the stack.
So you know immediately there are there are different parts of the stack here that yeah, I mean even for me sometimes like it can still be a little bit confusing. So you know there's M1, there's M2 and the idea here is for like M1 to act as you know this sort of like layer one that that enables M2 chains and roll ups to to launch on top of it. Can you explain like broadly what the stack looks like and
where? And also there may be zooming out like where these different components sit within the modular stack. If we bring in like now Celestia and Eigen layer maybe like union for interoperability, you know if we're looking at a sort of infographic of this, like what would that look like? Yeah, so we can. Start with top down South execution layer. You have the movement VM which is the DM salvage machine, supports move smart contracts as well as supports EVM smart
contracts. So it's the EVM interpreter that's eventually transition to transpire that exists on top SDK. So any smart contracts whether you're in MOVE or slowly Kansas other execution layer settlement is Ethereum. We believe that's the best security centralization also enables liquidity to easily flow to layer two through a trust minimize bridge. The kind of stack of framework we're using is a zero knowledge.
Rob, we're using versus right now for ZK fraud proofs, but also looking at scope out our own ZK Move VM proving kit. So you have MOVE VM execution, ZM settlement, ZK fraud proofs as kind of the roll up framework and then right now using slash C for DA, I'm giving us the one that's Live Today as well as allows for cold data to be pushed directly DA and saves a
lot of gas fees. So it's kind of like this Frankenstein of like different layers which is kind of the direction I I think a lot of different roll up in tubers. And last bit on sequencer portion, I think today's centralized sequencers cannot scale and do not scale.
I think most people agree. If you look inscriptions like it like broke every sequence that exists and the simple reason that arbitrary MZK sink and these teams aren't innovating is because they're making a lot of money on sequencer fees. Because we're a next Gen. roll up, our fees are basically pennies. So we don't actually prioritize sequencing fees. We have a fully decentralized sequencer day one that enables Valors to take the move token to participate in sequencing for layer 2.
So it's a fully decentralized layer to a network where the transaction fees are distributed to stakeholders, stakeholders take the token to participate in sequencing. So actually is like a bridge between like a layer one and layer 2IN that sense. How? How? Do you deal with the decentralized sequencing? Because if you kind of look at the L2 stack on Ethereum right now, no one's really figured
this out yet, right? So basically, S Tech are the people who are who are saying that we're not going to do this without, but they're also saying they're probably launched earliest in a year or so. Yeah, so. I think a large in groups like Origin based setter, they've all announced like Optimism Super chain is a sequencer. I think they've all announced that they want to do desensitize
sequencer. But like I touched on, there is no economic incentive for them to prioritize it because they're making a lot of money on sequencer fees. So it's always like OK, we'll eventually do that or we'll work with a third party, but the third party never really works out. So it's always been pushed back. For us it's a directly a priority a because we're a high throughput chain. So we each have a decentralized sequencer to manage the load down to the network.
And B, that's our token business model. We need a decentralized sequencer for the Ballers to have taking privileges, which actually accrues value and buy pressure for the token. So that means we're actually prioritizing as a core part of our tech stack. I think Metis is another one. Our mode, one of those has started and launched with the decentralized sequencer and I think we'll see a lot more of this come. I think Astra is also launching the new layer, two of the
decentralized sequencers. So teams that prioritize these centralized sequencers, we'll be able to Sprint to market, while teams that don't prioritize it have no sense to do so. Can you? Walk us through how it works. So the only the only technical implementation that I'm aware of is the one that Sello is pushing kind of who who are moving from like an L1 to an L2 network. So how how do you go about it? Yeah. So I think we. Have a very similar approach Sello.
Sello had a layer one. They now they're approaching this like layer two. Honestly cable idiom. All the valors from Sello were layer one to layer one, take the cello token to participate in sequencing for the cello layer two. So that kind of works how we have it, right. So we have M1, which is booklet stomach consensus. For those that are familiar,
it's from the Avalanche system. That's essentially A fastenality, extremely low hardware requirements and very decentralized consensus mechanism. That's our sequencer valor stick to move token to participate in sequencing for the layer 2. The benefits of using them and there is leaderless it when you water Q transactions, you can
have multiple different nodes. So if one node goes down, the network doesn't go down, you'd have a centralized point of failure and then B, anyone can run a node for the network. So the issues like slana apps and squeeze the hardware requirements are very high. The minimum stakes are very high. So it's very centralized in that sense. With our stomach consensus, anyone can run a node. It's very low sticky requirements, so we can have much more decentralization at a
network level. Cool. I want to come back to. The to the stack a little bit. So could you describe like what is the role of of M1? So is M1 like the the sort of shared sequencer that all M2 chains? Are are going to? Use. Yeah. And and then how does M1 then connect into IBC and then all of the other like move chains that are part of the broader, you know, move ecosystem, so you'll have M2?
As the main like fraction, well think of like the optimism chain, the main chain you have M1 as sequencer which is kind of analogous to optimisms super chain sequencer. And then we have other move rollups launching the network and all sequenced by the same sequencer set which is M1 which is like the OP stack rollups. So similar business model there was focused on A launching our sequencer off the bat and B on the next Gen. VM.
So our stack will actually complimentary to LP stack where you can use LP stack, use the move stack to the VM and connect to the sequencer. I think everyone's customizing ADA layer, customizing role frameworks, customizing proven marketplaces but then not touching the EVM at all. Our stance is we don't believe that should be the case. We should we want experimentation at the VM level.
If you're building a gaming role up which we see a lot of demand for, you probably want to use the Move VM or SVM something like that. And yeah, the M1 sequencer connects all the different systems, allows for liquidity to be routed seamlessly and then envision as you have these hundreds of roll ups all connected to Ethereum with this decentralized sequencer set. Fascinating.
And yeah, let's maybe just zoom in a little bit to where Celestia fits into all of this and how it supports the the roll ups being built on on top of album 1. Yeah. So the thesis last year was each settlement and EDA is really expensive. If it were like optimize an arbitrum, the fees are pretty high there. So how can we free all DA to really scale a theum roll ups so that you can still be on theum settlement but post call data to a cheaper source.
That's when Celestia Eigen avail even near an hour kind of position ourselves as leaders in the space from there kind of like what roll ups like ourselves Eclipse Manta etcetera have already been focusing on is OK we're bringing alt VMS and next Gen. VMS and different VM stacks to Ethereum. We need to use Celestia because if you have a paralyzed VM on top of theorem and you're not using alt TA it's still being really expensive.
You'll inherit security of theorem and obviously be a true L2 but the user experience could be pre subpar at least until the pool being shortings out which is appears out at this point. So that's kind of thes of these alt DA that also ties into the kind of IBC narrative which you touched on before. We're working with the union on being fully IBC compatible. They're building out so like kind of machines for us. So essentially if you want to do cross chain swaps on top of M2,
you can do that with IBC itself. Kecked Osmosis. Kecked to Juno. Kecked to your favorite Cosmos sones or World chains or whatever you want to call it, Yeah. So we're. Recording this on March the 12th and the dengue wouldn't upgrade is going to be tomorrow, so kind of this will give us Proto Deng sharding. I think it's pretty obvious that it's not going to be enough, but how much do you think it'll help the entire call data situation? Yeah, so it's an.
Exciting day tomorrow, so looking forward to that. But to be frank, Frank, I don't think it's going to be that noticeable. I've seen like some recent measurements and like I think I'm going to be a few cents difference the full day and starting as we know it is like three or four years out which at that case that we can reassess the needs for all DA. But I think like slust taking cut fees down at 99% today while per day and charting is like .1%
something like that. So I don't think it really it really is a factor I think user experience I mean F theorem will be a little bit better it's it's why I stepped in the right direction. But the fact of the fact, the truth of the matter is like Ethereum Foundation and like Ethereum itself can't move as rapidly as like Celestia Eigen third party infrastructure groups. So in the short term and midterm, honestly, all DS sells the market. And what's the?
Role of like restaking within the sort of movement story. And how does eigen layer fit into all of this? Yeah, so rethinking. Has always been an interesting area that I think it's definitely, probably the hottest thing right now, one of the hottest things people want to use Ethereum security. There's groups bringing you to Cosmos, there's groups bringing you to like Bitcoin and it's just like kind of using more capital efficient markets.
We're seeing a lot of layer twos work with resignal providers at the bridge contract level. So imagine you have like arbitrary deposit each to Barber trump, it can be able to restrict you with a Rio Renzo one of these players and have extra yield. So I think these are much like yield bearing strategies that layer two is adopting. I think the way we're approaching is like all similar to that like having LRT at the bridge contract. If you're a family office liquid follow you a lot of ETH.
You want to deposit on a chain. You can you can stake it on on an LST and then restick it with LRT on the British cadre level have fully automated so you don't need to worry about it. Have like extra yield that you wouldn't be able to get usually. And the benefit of loss is that because it's fully formally verified, it's actually the most secure way to restick ETH. So we topped a lot of liquid funds.
The concern they have is OK, I want to earn yield, but security is very important to me. I'm not. I'm family office. I don't like to take a lot of risk. I just like hold ETH and sell at certain times. So for them the pitch is OK. This is the best place to deploy ETH restate kit, earn the yield that you want, and have it fully, fully verified. So it's not the security concerns that you're actually
worrying about. It actually creates a bigger narrative around insurance, which gets me excited because in the past insurance has been really pretty much useless because it's more contract risk. There's actually a world where you can, because you have ETH, you can use that as collateral for investment. So if you're like using Ave. or USWAP on chain, you want to use Restake as collateral.
You can use IGA insurance, which in the park protocol they're working on as collateral for the investment. So that's another ABS that's actually really exciting especially for the move because the security gaps enable it to be much more risk adverse or much more risk better, which enables interest rates to be lower, which enables retail
capital come in more easily. Any thoughts on the rise of Bitcoin L twos because kind of we've in the in the past months or so those have been all the rate right? Yeah, I. Think like personally, I don't really understand that well. I'm not that deep in Bitcoin
space. So like the Bitcoin programming space, I'm sure there's other people that can see better to it. For my standing, it's like a way for people to you take existing Bitcoin reserves, put it on chain or put it into we're now like custody multi sigs or side chains and are on yield for that. So in the short term makes sense.
It's a way to generate yield and it's a way for layer twos or whatever you want to call it to boost up TBL ability, rolling chain like 2 billion three billion TBL in a week or something crazy. And I think a lot of geek systems are now looking at that. How can we acquire Bitcoin liquidity. In the past rapid TC was always available but family offices, liquid funds don't really want to wrap BTC because the whole process gas fees are really high. It's a risk.
So BTCL, twos enabled needed Bitcoin to exist and be repurposed for yield. So I think what a lot of different groups are looking at is how can we integrate something in Babylon, integrate like the BTC accrued from there and earn the yield for our system. So something that we're looking into is, is there a world where we can be native BDC, be it Babylon or other infrastructure providers and have that used in D5. But obviously we're experimental and probably more down the road
map. But I think like Bitcoin itself is here to stay. I think that each EF proved that it's going to be like currency of gold. It's not going to be very programmable. I don't imagine the next social or gaming app being built on these BTCL twos. I don't think that's possible at my current knowledge. I think it's just a way to repurpose BTC, which is cool. So I think short term play makes sense. Long term, I'm Kevin Schurr. But teams like us are looking to kind of leverage that for
existing TDL Security benefits. Yeah, I I personally think that Bitcoin is going to play a a bigger and bigger role in the Layer 2 narrative in the coming year. And you know a lot of that I think is fueled by you know the ETF bringing like lots more liquidity into the space but also a lot of the kind of technical developments that are
happening there. So I've you know there was this Bitcoin renaissance event at Denver and I think like half of the teams that were that were that had boost there were were building some kind of restate Bitcoin product or liquid steak Bitcoin product And and I think that you know given bitcoins position as like the largest and more secure blockchain it makes a ton of sense for that capital to be utilized well one in D5 through liquid state assets with now whether like that's
technically possible that you know you can do sort of trust minimize versions of Bitcoin on other chains. It's going to be very important like yeah, we don't want this just to be a multi sig, but then yeah, the security aspect I think is also huge. So like whoever figures that out and brings it to market, I think we'll we'll do very well.
Want to move on now to, yeah, you you guys announced a couple of months ago a partnership with Yeah Union and Noble and I was really excited about this 'cause we're we're all also very bullish on, on those two teams. Yeah. How does this help bring USCC to movement? And can you describe maybe like the role of Union in bringing IBC to, you know, the movement ecosystem, but also Cosmos and Ethereum and sort of tying it all together so that we can have fungible USC across all these platforms?
Yeah, things like IBC has always been like regarded as like the most secure, one of the best bridging centers on the market and there's a bunch of transport layers on top of that which like layer 0 wormhole, hyperlane. Recently Wormhole was a nice warm chain which is like gateway now which is their cosmos adaption layer. Zero and Hyperlane both have also obviously adaptions. You have Xlore as well.
So all the biggest bridging protocols all use IBC under the hood, but they use it probably non-native way is really difficult. I mean point of view to use them like for warmly you have to bridge to the gateway and the bridge gateway to respective chains. There's lack of native IBC connections. So there's a few groups that have emerged to kind of solve this problem. You have like Palmer Labs, you have like proposal finance, you have Union Labs.
Now they're now looking at different ways to bring IBC natively T systems. So part of our partnership with the union is they're working on building direct Lifeli machines for a layer or two. So if you're a DAP on top of movement, you can do transactions directly. Does Moses do it to other chains?
It starts off through the Union chain I believe, but eventually they'll be native IBC compatibility, which really exciting because now you can have any of USCC, you have Adam, Tia, you can get the benefits of all the Cosmos and assets that people want on chain without relying on the third party and secure bridge provider. But I think my general thesis is
that IBC is the COSMOS standard. I know we touched on this as convergence where Cosmos accomplishes the vision, the Internet of blockchains where every roll up, every L1L2L3 or whatever you want to call it, we'll use IBC as a main bridging provider bridging standard of the hood. It's just depending on like where the wrappers on top of it and transfer layers on top of it that facilitate that.
So you have like Wormhole doing it from like their point of view which is more third party and more trust reliant and you have like Union and Palmer which are looking to kind of address the security assumptions and increase speeding times. Union specifically is looking at ZKIBC. They built Comet BLS, which is a new standard for messaging, some pretty exciting and bullish on them, which is how we're working
with them. Yeah, I'm I'm glad you mentioned conversions because there's a couple of topics that we we touched on at the event that I'd like to bring up here. So you know one of the topics that we talked about was USD denominated asset dominance in crypto.
It's obviously like USDC and and Tether are you know by a large margin leading in stable coin issuance you know over things like like die and and other decentralized stable coins you do do you think this like you know Corel from Union was on the panel also And so I I encourage those who haven't seen that to go check it out. It's on the Nebula Summit YouTube channel. We'll link to it in this show
notes. But you know he was saying that you know he felt that there was a risk to crypto to having these well one like centralized centrally issued stable coins. But also I think another topic that another sort of point that I haven't heard brought up very often is yeah, you know this USDC denominated stablecoins. So it's kind of like US alignment, U.S. dollar alignment risk. Do you do you see that as a risk and you know how?
How can one mitigate that considering the fact that like these stablecoins already have like such dominance over the space? So yeah, we discussed like USCC dominance and my thing is like I have actually pro Circle dominance in the short term because if we already have very few users on chain and like if you ever want like consumer safety, right now we need like a third party like big provider Circle Coin Base to really issue these assets and provide
confidence to retail users. Like going back to my example of like family using crypto, if I told them to use like die or a maker or like some of these other stable phone providers, they're probably free down big. What is this? If I said it was like, OK, it's a stable coin issued by Circle, like now probably going to be a public IPO company. The very US regulated, has a lot of rules, regulations, they feel all more comfortable. So there's like two kind of
markets here, right? You have like retail, which is like people who don't really know crypto at all. They want to explore with it. You need Circle, you need a Coinbase, You need centralized authority for them to feel comfortable. And then you have the experience on chain degens. People have been trading for years. They recognize that in the world that Circle kind of goes rogue or Coinbase goes rogue. They want the ability to safeguard their holdings.
That's why Dye is really interesting, that's why UCT is like is interesting is that was like Athena, which is not a stable coin, but they're providing different in investment kind of issuances. So I think there's different groups for those categories where you can provide solutions and stable coins and assets for more roughly native people. But to bring in people's base, you do need centralized authorities. So actually Pro Circle Pro
Coinbase issued assets. Yeah, I think that makes sense to me. I think in the short term it makes sense. You know, looming in the back of my mind is always this censorship risk with USDCI think that's really the main risk that I see. But as the space becomes more regulated, that is going to be the case. Also most likely like, I mean all applications and and dash will be subject to potentially like having to central transactions that don't fall in
line with like compliance. Yeah. In terms of, yeah, like this Cosmos and Ethereum convergence idea, which was the main main topic of the the panel in Denver, Yeah, what's the end game here for you like in terms? Of cosmos. And Ethereum coming closer together and benefiting from each other as sort of strong points, Where do you see that heading towards? I think Ethereum. Is used for liquidity, is used for settlement security. What Cosmos is used for
communication. The Cosmos has a lot of different features. They had tournament, they had SDK at IBC, they're called BFT, gone BFT. There's a whole zone thesis with like custom app chains. I think a lot of the times the zones had a lot of struggle with Isotoponomics and blue shopping values.
That's a pretty difficult. But the one thing that was always prominent and like beautiful was if you had multiple zones, you could use a Cosmos CK and you connected to Osmosis, you connected to your favorite chains and it's permissionless interoperability which is kind of like Hyperland's motto. But I really see that kind of mantra spreading towards the theme of the modular stack.
Where in this world where you have all these roll ups and all aspects of chains, you don't want to wait for a third party bridge provider to always deploy. If I'm building a new gaming chain I want to watch 3 weeks, I sure have to wait for layer zero or any other kind of third party bridge provider to deploy on top of me. I should be able to use IBC or some third party pretty standard to get connected to my favorite chains so I can Sprint on my
product. So I think that's where IBC has a unique market where enables for permissionless interop, a few different groups building wrappers on top of it. But IBC is the standard that's going to be adopted for this mass welcoming of change that's coming.
Whereas the theorem is still like the programmable computer where people building on top of it, using it for liquidity, using it as like a supercomputer and then IBC is connecting on it. So I think the Cosmo theorem narrative and the Cosmo theorem vision is coming to fruition today where maybe Cosmos zones don't win but IBC wins which means that Cosmos wins and maybe that Ethereum layer like Ethereum Layer 2 and Ethereum DA as don't really make sense.
There's also a question about what is a roll up is a if you're really does that mean that you're a roll up or is that mean L2? I think that's a frivolous debate. I think as long as you can get Ethereum some give some some capacity doesn't really matter. I think that if. IBC wins everybody. Wins. I think it's not so much.
About like I think the End Game is just you know and and Ethan Buckman and and Sam Hart were talking about this on a on an episode of I think it was like one of the Block Works podcast recently and they were talking about the end game. And like the end game is all chains using IBC and benefiting from this amazing intro ability technology.
And then you know if I take it even a step further and this is sort of Corel's point of view, is that we we have this swarm of validators that is validating the state of all these chains. And as an application, you know, like there's just, you don't know who's validating your your your transaction, but it's it's being added to this massive sort of swarm of state, this massive state that is secured by the swarm of of validators.
I kind of see that as the as the end game where Aetherium sort of sits at the bottom layer provides liquidity provides a major part of the security. But Cosmos, you know through its construction, through the construction of the the Cosmos stack and been at the forefront of of modular with the app chain thesis brings the technology and the technical philosophy to build that applications in a way that makes sense.
I'm 100. Percent with you both that kind of IBC is kind of like the absolutely golden part of Cosmos. So I think this is something that kind of the theorem ecosystem is lacking and and bad kids we see it. And bad, I think. Bad kids always win. There was a. Podcast, probably already here a year and a half ago.
Also with Ethan on Bankless. Interestingly, where kind of he argued his thesis that Ethereum is kind of like this empire where kind of everything ultimately settles back to Ethereum, where whereas kind of cosmos is like this network of cities, states with kind of like pockets of value. So now in this Cosmos and Ethereum convergence picture, how would that kind of translate into this metaphor in terms? Of cities and states like where? Yeah, in terms.
Of like having like a giant empire where basically everything's kind of like inverted pyramid shaped and everything ultimately said it's back on main net where so like
that's. I would say like the United, I would say clearly the US for example the United States would be Ethereum. You have a bunch of different states which is like you have like movement is 1 state you have like another roll up is another state you have all these different states are all over for roll ups and the highways that connect all the different states are is obviously where you need like connectivity between the different states.
Otherwise if you're from California you can't get to New Jersey. If you're from like Oregon you can't get to Florida. So that's like the main problem actually between crypto is like if you look like earlier settle stage when America was first developed, this is probably just might inherit American coming out. But like there was like really it's really hard to like travel between different States and different regions.
Back in old America when they built roads out and transportation properly, it was really easy to get between four states which enable people to network easily and meet their family and friends. Same thing in today's crypto where you have a theorem which is like kind of the barren land.
It's like it's like the 1700s out if you would say where you all of different states kind of forming but still kind of figuring out what their markets are like like California was a gold state at one point in New York was a financial hub. People were still trying to figure out their hubs in that case. And then the main thing that's missing is kind of the roads between different chains or in this case states which the Ibcs position to be a best candidate.
I was like IBC would be the asphalt in this case or the concrete and then like different groups this is getting really in depth to it, but like you have like Looney and Polymer in different groups that are actually building the specific roads if it makes sense. We talked about. Adoption kind of depths that with of, you know hundreds of millions if not billions of people in the very beginning kind of when we talked about Facebook's motivation to create
MOVE. So what does the future look like for for Move and Ethereum and kind of when do you think we'll see the first steps that actually have that sort of mainstream appear? To plug myself, I was like our main net, but the the real answer would be like like it depends on what your real apps are like. I don't. I don't. I think there's no apps in crypto yet. We don't have any real apps yet. I'm talking about like we don't have like an on street social app.
We don't have anyone that my parents are talking, my friends are talking about. So we're still very early on that too. Like I can we can say like oh we'll have X amount of D fabs, X amount of TBL, but who really cares. There's just another like copy pasta of another layer or two. We're trying to build infrastructure and apps that means people can use send payments at the speed of light across the world.
So I would say like the movie system is poised to carry that through the best, A, because you have backing from two of the biggest consumer chains on the planet and then B, like the language itself is designed for consumer development. So I I would say that within like three years we could see like a really prominent consumer social app that gets a lot of
traction. But in the short term you will see like much much more Pro France Security 5 strategies compared to like traditional era twos than traditional methadium solutions. Great. Do you want to? Share a little bit about, yeah, sort of short term, I mean road map for movement, when can we expect mainnet and how can people start building on movement or perhaps getting involved?
To get involved like. Go to Disco, check out like a Builders community Moving Labs XYZ website, follow me on Twitter at Ushimonchi and then we're rolling out a lot of stuff endless month and setting some announcements coming on fundraising as well as like test set aspect coming out next month. So Dev Nets fully live as well as it's a device test set shortly.
Awesome. Rishi, thanks so much for coming on Epicenter and expanding our minds on the on the Alt VM thesis and why movement is going to the mood pressure. On it. Thanks so much for having me. Really appreciate the time. Thank you for joining us. On this week's episode, we release new episodes every week. You can find and subscribe to the show on iTunes, Spotify, YouTube, SoundCloud, or wherever you listen to podcasts. And if you have a Google Home or Alexa device, you can tell it.
To listen to the latest episode of the Epicenter podcast, go to epicenter.tv/subscribe for a full list of places where you can watch and listen. And while you're there, be sure to sign up for the newsletter so you get new episodes in your inbox as they're released if. You want to interact with us? Guests or other podcast listeners, you can follow us on Twitter and please leave us a review on iTunes. It helps people find the show and we're always happy to read
them. So thanks so much and we look forward to being back next week.