Is Ethereum Back on Track? | Jon Charbonneau & @0xBreadguy

Jon Charbonneau and Bread join David Hoffman to unpack Ethereum’s pivotal moment—facing tough choices to re-focus on its Layer 1. They break down Ethereum’s shift back toward prioritizing L1 growth, the delicate dance between Layer 1 and Layer 2 strategies, and why Ethereum must reclaim DeFi as its core strength. The conversation also explores the nuanced dynamics between Ethereum’s cultural vision and technical roadmap, how Layer 2s fit into Ethereum’s evolving ecosystem, and what this strategic recalibration means for Ethereum's future in a competitive crypto landscape. Jon Charbonneau: https://x.com/jon_charb Bread: https://x.com/0xBreadguy ------ 📣 WALLET CONNECT | ONCHAIN UX ECOSYSTEM https://bankless.cc/WalletConnect ------ BANKLESS SPONSOR TOOLS: 🪙FRAX | SELF SUFFICIENT DeFi https://bankless.cc/Frax 🦄UNISWAP | SWAP ON UNICHAIN https://bankless.cc/unichain 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🌐SELF | PROVE YOUR SELF https://bankless.cc/Self 🏦INFINEX | THE CRYPTO-EVERYTHING APP https://bankless.cc/Infinex ------ TIMESTAMPS & RESOURCES 0:00 Intro 5:28 Jon & Bread’s reaction to the Dankrad/Angsar episode https://www.bankless.com/podcast/ethereums-strategic-pivot-ansgar-dankrad-mike-ippolito https://x.com/TrustlessState/status/1914402754891559253 https://x.com/TrustlessState/status/1914330497905299790 27:56 Unichain or Ethereum L1 is DeFi? https://x.com/TrustlessState/status/1913633500206428201 35:07 Making the L1 competitive while keeping L2s happy 44:38 L2s Parasitic? 48:49 Bitcoin Roadmap Bread vs. Jon 57:09 Decline of the ETH price & all asset prices overpriced? 1:05:02 ETH/BTC growth slowdown reason 1:13:35 The politics side of the conversation 1:19:05 What Bread & Jon are excited about 1:26:49 Closing & Disclaimers ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:04David Hoffman?

  Welcome to Bankless. Today on the podcast, I have 0X Brad and John Charbonneau. Brad and John are both informal researchers, educators in crypto, and both have been active commentators on the evolution of the Ethereum roadmap and the position that Ethereum finds itself downstream of the design choices that it's made. The recent episode that I did with Antgar and Dankrat has changed the conversation around Ethereum, as people are now imagining a different future for what Ethereum could be. One where the Ethereum Layer 1 has a renewed focus and attention from Ethereum leadership. Still a roll-up centric roadmap, but all around a strong Layer 1. Since Brad and John have been so active in this conversation over the years, I decided to get them on to have a discussion about their thoughts and what they think will happen next in Ethereum. Before we get into the episode, a message from our friends and sponsors over at WalletConnect.

• 0:48David Hoffman?

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• 1:33David Hoffman?

  In addition to talking to Brad and John about the Ethereum roadmap and its future, we also just opened up the conversation and talked about Bitcoin's roll-up centric roadmap. Yes, Bitcoin has one of those, as well as the story of Ether, the asset, and what it should be in 2025. We also talk politics and crypto too, because we're really just here to have a conversation about the topics that we are interested in, and we're going to do this next week too. I had fun with Brad and John, and they said they had fun too. So we're just gonna run it back a week from now with one more guest who couldn't make it today. And we're just gonna chat about the weekly meta. Whatever is in the meta, maybe it's content coins, maybe we've moved on to something new by then, whatever floats our boat. Have to wait and see. So if Bankless Nation, you liked this episode, do tell. If you're a bankless citizen and you're in the Bankless Discord, at me and tell me if you liked it,

• 2:18David Hoffman?

  or if you didn't. Or if you're on Twitter, you can do the same. You can at me there too. I want to hear what you think. And with all of that out of the way, let's go ahead and get right into the episode with John and Brad. But first, a message from some of these fantastic sponsors that make the show possible. Imagine verifying yourself without handing over personal data. No hacked databases, no unnecessary personal exposure for airdrops, and no AI bots ruining community governance. Meet SELF, the on-chain identity verification protocol built for privacy and control. SELF Protocol uses zero-knowledge proofs to confirm your identity safely. Users prove key details like age or citizenship without revealing sensitive personal information. SELF never stores your data. It only generates cryptographic proofs. Here's how it works in three steps. First, register and verify.

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• 4:28David Hoffman?

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• 5:12David Hoffman?

  Follow Mantle on X at @mantleofficial and join the on-chain revolution today. Bankless Nation, I'm here with John Charbonneau and ZeroX Bread Guy. Bread, we just had you on the Weekly Rollup, coming back on for round two just a few days later. Good to have you back.

• 5:25Speaker 01

  Yeah, you couldn't quit me, so here I am.

• 5:27David Hoffman?

  Yeah, John, also, it has been a while. It's good to see you back on the podcast, my man. Let's go. Good to be back on. Yeah, okay, so we just put out this episode that we titled Ethereum's Strategic Pivot. I think it's going around the Ethereum community, kind of making waves in the Ethereum community. Haven't really seen it go outwards too far beyond that. I think the Ethereum community is still kind of digesting and processing it. But it seems to have struck a pretty meaningful tone. People are taking this episode pretty seriously, this conversation, very seriously. And I wanted to start by getting your guys' reactions and reflections on the episode. John, you've been a commentator of Ethereum's malaise and what Ethereum needs to do. And so I think this is directly in that same arc of content

• 6:11David Hoffman?

  that I think you helped inspire in the first place. So maybe I'll start with you, just what were your first thoughts and takeaways coming out of that episode?

• 6:18Speaker 02

  Yeah, I mean, my very TLDR is I thought it was great. I share like a mix of the kind of the same sentiments that Ansgar and Donkrad kind of had at the end of it, which was particularly Donkrad was calling out of like, you know, I mean, the big next step from here is, you know, obviously, a lot of this is like, it's a lot of talk, it's a lot of vibe change, a lot of stuff like that, like we need to ship actual things. And so that is obviously the big, concrete, open question is, you know, what is this going to lead to very concretely over the next, you know, six, 12, 18, 24 months? What is actually going to get shipped in reflection of this? But for what you can't ask for now is, you know, what has changed in the last, you know, three, six months? And I think the vibe shipped have genuinely been great over that kind of period of time.

• 7:00Speaker 02

  There has been a just very, very big shift of, you know, there is a full just acceptance of, all right, like, we have some problems here, we need to fix these problems, you know, what have we done wrong in the past, what can we do better in the future? You know, it's all those things, you know, having more product for product first mindset, you know, what are the areas very literally that we can improve technically in reflection of that, stuff like that. And then also kind of on the people's side, like, I do think the kind of leadership shakeup, I mean, that's always a good way to restart things. And from talking to people who are involved there and just from, you know, just having background context of like, you know, just knowing Damash previously, I mean, like, I was super excited about those changes. And when you talk to the people in the F, you know, people like Ansgar and Donkrad, like, you can, you can definitely feel that it is, it is different now, how things are working now versus, you know, a few months

• 7:43Speaker 02

  ago before he showed up. So everything is like definitely trending in the right direction is my honest feedback at this point, which is great to say.

• 7:50Speaker 01

  Would you say you share the same rose and thorn that was pointed out at the end there by Donkrad? Like, the rose was like, feels great, like acknowledgement of the problem, stepping forward, but still like, yeah, well, you haven't done anything, right? Still got to deliver. Would you say you're in that same, same camp?

• 8:07Speaker 02

  Yeah, very, very much the same thing. Which is, you know, I mean, in an absolute sense, I like, that is obviously the more important thing is that nothing concretely has like actually like really changed or shipped or whatever in reflection of this. But with an understanding of, you know, I mean, like, the stuff I was talking about was maybe five, six months ago, something like that at this point, and there's only so much you could change in a period, like in that period of time. I think the best that you could ask for over the course of, you know, a few months is something like this of like, there is a meaningful vibe change across, you know, All like people all across the Ethereum community and particularly at the top. And I'm very literally leadership organizational changes at the EF. You know, what are people prioritizing? It's prioritizing, you know, thinking about these are things we can do on L1 scaling in the next six, 12 months, stuff like that.

• 8:50Speaker 02

  Which is, so there is a lot to do. I mean, this is a small percent, a very, very, very small, like, single-digit percent of the things that actually need to change in the long term. But realizing that, I mean, that's, that's the best you can hope for in this, like, pretty short period of time.

• 9:04Speaker 01

  Brad, what was your takeaway? Honestly, the same, except, so my, my general view, I've been calling for a scale of L1 for a long time, about as long as John. But somehow I've been able to straddle this line of not being pointed and laughed at by the Ethereum inner circle. I guess is probably the best way to say it. Where it's like, Donkrad at the end of that was very, very pointed and like, you know, he's, he's always had the position of scale of L1. Block space is not fungible, state is valuable, all this stuff. I share that same opinion. I, I genuinely think that, like, people have over-indexed on just how abstracted a lot of this stuff can actually be. And like, to actually drive value back to your asset, which is like what everyone wants out of this stuff, right?

• 9:45Speaker 01

  We're talking about like technological handling of a lot of this load and latent demand and global block space, you know, appetite. But like, in the end, people will say like, you want to have the, the demand pick up, but also the correlation of token price needs to come with it, or else no one's going to be happy. Right? So it's, I, I think prioritizing that stuff and driving value back to Ethereum has, is going to come from prioritizing its own block space, prioritizing its own state. And, uh, yeah, Donkrad had alluded to that, but then said, like, he opened up the window saying, hey, uh, I don't know what can happen. Maybe like the roll-up centric roadmap is appropriate. It's, it's, uh, it can work out, but it's because he doesn't understand like what the potential outcome of that abstraction can be.

• 10:27Speaker 01

  And maybe it can actually get to a point where, you know, this stuff is semi-fungible, like it is interoperable. You're interacting with multiple chains, but it feels like one, like maybe that is a future state. I'm more skeptical of that, but, uh, yeah, I've been able to do it without being hit with the scarlet letter.

• 10:43David Hoffman?

  Yeah, I do agree that the general summary of the episode and the Ethereum community's comprehension of the issue over the last six to nine months has focused on this idea that prioritizing the layer one is the missing piece that has been missing for a while. And also that like the Ethereum culture is like concerned with a sphere, has a too large of a sphere of concern, as in like the sphere of concern for Ethereum is, you know, rollups, layer twos, anything that touches Ethereum is Ethereum. And that has come at the cost of attention and focus and prioritization of the layer one. And so,

• 11:27David Hoffman?

  like, you know, this, this has some level of like Bitcoiner mindset about it, where, you know, you preserve the value of BTC at all costs. You preserve, you have your first low key of concern at the innermost core of the system. And as things get further away from the core of the system, you have a smaller amount of concern for that. And Ethereum, maybe the malaise of Ethereum is that its low key of concern was so large, any layer two that settles to Ethereum is Ethereum. And that's come at the cost of the layer one. I think slowly, people are repositioning themselves to think like, okay, the, the layer one actually might be the, might ought to be the epicenter of the low key of concern for the Ethereum community and Ethereum culture. And that might be

• 12:06David Hoffman?

  the logical place to focus our energies in order to have a sustainable ecosystem. Reflect on that for me.

• 12:14Speaker 01

  Do you think BTC's concern is actually the price? Or is it the values of like, you know, having a cap money supply defending against, like, I think, yeah, asset appreciation is a byproduct of that. But do you think that is the, the number one thing that they are optimizing for whenever they say like, you know, don't change the code, don't, don't push to L2s, don't whatever?

• 12:35David Hoffman?

  I think Bitcoin is optimizing for the 21 million hard cap. And what I mean, what I mean by that, by comparing Bitcoin to Ethereum is like Bitcoiners and Bitcoin is concerned with Bitcoin primarily. And that has not, that's not equally true with the Ethereum community. Ethereum community is like concerned about like this large, like nebulous cloud of second layers that, you know, settle to Ethereum, which can be some combination of aligned and misaligned with the interests of the layer one.

• 13:04Speaker 01

  Yeah, and you're starting to draw lines around that, right? Like, you put out that image that has the concentric circles of like how Ethereum, quote unquote, you actually are within the ecosystem. I don't know if you got any, like, specific feedback from that, just like putting that out in the world and hearing people talk. What was the vibes you got back from the world?

• 13:20David Hoffman?

  It was mixed, yeah. So I've put out a couple images that are going into this article that I'm working on. And like, you know, when you put out, I'm putting out feelers on Twitter, right? Like, how does people respond to this? And the first image I put out, everyone responded to very, very well. And that first image was just like a circle of Layer 2s, optimism, world coin, abstract, a circle of Layer 2s around the Layer 1, around the Ethereum circle. And in the first panel, in the first image, the Ethereum circle was very small. And then there was an arrow to the same exact image, you know, same Layer 2s around the Ethereum center, but in the second image, the Ethereum center was very large, the Ethereum circle was very large. And I said, like, this is what the Ethereum community wants. And I think everyone responded extremely positively to that image, the implication

• 14:05David Hoffman?

  of we just, the Ethereum holders, ETH holders, just want a larger, more powerful Layer 1. That's what ETH holders want. And so, like, universal acceptance of that, even, especially from Layer 2s. Layer 2s commented on saying like, yeah, I want, we want this. Like, Alice Glukowski said that. The second image, the image that you're referring to, Brad, where I had like this first circle, which was Ether and Ethereum, the Ethereum Layer 1. The next circle out was based and native rollups. And then the next circle out from that was based or native rollups. And then the next circle out was just rollups. And then the next circle out from that was Layer 2s. And I put out this image, that I put out the spectrums, like, well, if you are the Ethereum Layer 1, you are Ethereum.

• 14:48David Hoffman?

  And as you get away from this concentric circles, you are becoming less Ethereum. You are imbuing less properties of Ethereum into your rollup. And that was very mixed, the reactions, that was very mixed. I think you responded positively to it, but other leaders of other Layer 2s came into my DMs and told me that they felt hurt by this because they, and it was a little bit of a misalignment of what I was trying to say, but people are thinking like, Okay, Ethereum is like the United States of Ethereum. And saying that Layer 2s are not Ethereum is saying like California is not the United States. And they're used, it's this like very squishy semantic political

• 15:28David Hoffman?

  idea of what it means to say Layer 2s are Ethereum. Because people want this thing, this idea of Ethereum to be Ethereum. Where other people are interpreting it. I think people with something like John's disposition are saying like, "No, the Ethereum Layer 1 is Ethereum and other Layer 2s are different chains that settle to Ethereum." But people like John, and I think people like you Brett, have this preference for technical objectivity. And other people in Ethereum have this preference for this big, grand Ethereum vision. This idea of like the Ethereum ecosystem, the Ethereum network state, the Ethereum system. And there, and there's a, these clash, these clash, and they're hard to, they're hard to contend with. I'll pause there.

• 16:11Speaker 02

  I'm not, I'm not surprised, but I do find it funny how people are more universally positive on that first tweet. And then more people have second, more people have problems on the second tweet. When necessarily you shouldn't be able to be positive on the first one and then have a problem with the second one. Because if all of these are Ethereum, then it shouldn't matter which circle is bigger or smaller. Like, "Oh, these are the same thing. Like, this is one circle. Like, why do you care? It doesn't make a difference." But it's a different, like, no one's gonna say, "Oh yeah, no, no, like, we want the Ethereum Layer 1 to like, be really small and like go away." Or at least less people say that because it's seen as like more openly, I think, confrontational and competitive to the Layer 1. And like, that's where you get like a dicey line as a Layer 2 of being like, "Go away, no, we want all the users." You don't want to say that quite explicitly.

• 16:55Speaker 02

  Versus the, I think the other part, I'm not surprised that an Merval 2 founder didn't like the getting rid of the bases Ethereum, Arbitrum is Ethereum, Octo is Ethereum. Because I think very obviously that has been to the benefit of all of these Layer 2s over the past couple of years. They get to kind of piggyback off of a lot of that branding and alignment and association. And just like being put in front and center as this like credible, great thing, like we are Ethereum. Like, that has obviously been very beneficial to them. And so I like, I am not surprised that a number of L2s would not love that deep prioritization of that. But I mean, this gets to, you know, like, what are you just trying to solve for? And I think that a lot of people, what people are trying to solve more and understand their problems now is like very literally. I mean, like a lot of it centered around like, what is ETH price doing?

• 17:37Speaker 02

  And if you do care about ETH doing well on the layer, then you probably need to care about the layer one doing well. Because I like, no one can dispute over the past, you know, year or whatever, that like, Base is doing great. Like, they're not having any, Base has no problems right now.

• 17:51Speaker 01

  There's no malaise in the Base community.

• 17:53Speaker 02

  Like, yeah, like, they're having a great time with the rollup-centric roadmap so far.

• 17:58Speaker 02

  Their problems will end up being like a technical, like if they're bumping up against the gas, I mean, like that, they literally do need more of. But like, there's no concern about value capture or anything like that from the Coinbase side. Those value capture type concerns are at Ethereum level. And so like necessarily, that means there's going to be a little bit of, you know, a re-architecting, a shifting back of like, okay, what do we need to prioritize in reflection of? If we want to move some of the value capture here, you're going to care more about like, all right, we need to actually prioritize L1 scaling and all these things and not just kick all the users to the L2s, like you guys figure out all the interrupt and like, whatever. You need to just start providing more of those products yourself in-house.

• 18:31Speaker 01

  I think that's why that first image actually carried well. Because like, if you, you're right, they're saying the same thing and you only see price in one of those two images, right? You don't see price in the, in the alignment image, right? You just see that like, oh, I'm no longer, I'm doing all this good work or I thought was good work. And like, now I'm starting to realize like, all this thing that I did that I thought was right is maybe not as right as I was intending. And like, there's a lot of frustration with that. I totally get it. Like, that's, that is what it is. But in the first one, right, like, the technical property, like, that doesn't describe technical properties at all. There's no differentiation between those two, right? Ethereum is just as good at, you know, $1,200 as it is for $2,000. And like, that's kind of the problem is that the price action hasn't really, doesn't really dictate, at least, you know, when we get extremes, yeah, sure. Just security is like, becomes an issue, whatever, but

• 19:17Speaker 01

  it doesn't really change the properties it grants to these L2s purely based on price, which is kind of the value proposition issue. Right? It's like Ethereum being much more expensive at $2,000, $3,000, $5,000, $10,000 is not necessarily a better settlement layer than when it is at $2,000. And yeah, people just want the dollar to go up or the price to go up. They don't necessarily care that the technical properties are that much better or that I can actually use Ethereum. They just make the asset go up.

• 19:45Speaker 02

  And the interesting tweak that you could have made to that first picture too, which would have gotten a different reaction, and I think actually would have touched that like a different, but important point too, is if, so the image that you had was strictly positive sum. None of the layer twos shrunk in the second picture. If you proportionally shrank the layer twos in that second picture by the amount that ETH grew, then what would their action have been? Like that, that would be a good A B test.

• 20:07David Hoffman?

  You know, it's funny that you say that because as I was making that picture, I actually started making that second image actually by shrinking the layer twos. And I was like, wait, wait, wait, actually that might piss people off. Let me actually just increase the size of the layer one. Let me just do that. And so it's like, all I'm doing is redrawing the size of circles. But how you redraw them really, really matters. Yeah.

• 20:30Speaker 02

  And that actually does kind of touch on the important point of, you know, whether you would like this or not is what do you think the outcome actually is by, you know, doing a lot of, you know, juicing up the L1 scaling? Do you view this as pretty positive sum to the L2s? Or are you as in a two L2 viewing this as like just strictly competitive, you know, zero sum? We have users, they're taking more of the users. We have, you know, we're going to shrink. Depending on how you view that outcome like playing out, actually does end up different. Because I think there's good arguments that it's positive sum, that's negative sum, that it's zero sum. That is positive sum of, you know, hey, if, you know, this sends ETH back to like 5K, all the L2s are probably going to be doing real, you know, real well. They're going to have more assets, more users, their tokens are probably going to go up too. Like, I think that's a reasonable argument. There is also a reasonable argument that, oh, this stuff is small right now.

• 21:14Speaker 02

  This is pretty zero sum. Like, they're just going to take the users away. And it might even be worse because now you're bringing them back to the worse UX area and they're really going to want to go somewhere else. So I, no, no one honestly knows how exactly it will play out. I think there are like different possible outcomes there. But that actually does kind of touch on like why people would be in or not, which is interesting.

• 21:33David Hoffman?

  Yeah. And okay, so I actually really like that line of reasoning. I think if the Ethereum layer one does, you know, expand its capacity, I don't think that that would be felt equally across all layer twos. For example, coining content on base, I do not think will change because the Ethereum layer one grows in capacity. And I think like- Whatever ultimately comes out on Mega ETH, for example, a streaming blockchain, whatever apps fit on a streaming blockchain is not going to be really impacted by the layer one going from 17 to 70 transactions per second. But I think that there aren't going to be other layer twos which do materially lose out because they haven't been able to differentiate themselves. They're kind of a commodity.

• 22:17David Hoffman?

  Maybe they didn't really have a reason to exist in the first place. And I think some layer twos that don't have strong differentiation, which is what Onsgar was saying in the podcast, that it's kind of like the Fed raising interest rates. When the Ethereum raises the capacity of the layer one, the marginal L2 that we didn't really need can't really justify its existence anymore, is a take.

• 22:39Speaker 01

  Yeah, I mean, not that they were needed anyways, right? We're seeing power law pretty heavily in the L2 world. Like, so, yeah, 0.5% of transactions are existing on L2. But if the capacity of Ethereum goes up, right? It's not mutually exclusive that it does not benefit the L2s, right? Basis capacity goes up if blobs are gone up. The interop is improved because now Arbitrum and Base can settle faster because the finality is quicker on the L1, right? So it's like, they are materially improved if Ethereum improves, right? Ethereum could be a better settlement layer. And if then those dominant chains that are already showing power law start to become even better as dominant chains, right?

• 23:21Speaker 01

  Like, Base has been at capacity and begging for increase in blobs space for the last, what, six months-ish? Right? So it gets the space back. It's been at capacity. Now that that capacity goes higher, it probably takes away from other L2s even more than it already has been. I think that's just kind of where we're seeing the market is going.

• 23:37Speaker 02

  Yep. Yeah, and I think it's honestly positive to just set the bar a little bit higher of, you know, what is the minimum viable thing that you should be providing to just even be able to claim like, hey, here's a reason why I'm shipping an L2? I don't think that it should be a reasonable, like, sufficient answer of, oh, I'm shipping an L2 because it's a little bit faster and a little bit cheaper than the layer one, and we do the same thing, like... The layer one should probably just do that. You should just have like a reasonable bar. And then there's a million things that, I mean, layer twos can do to like uniquely differentiate. You know, whether that's, yeah, just like ultra low latency for certain types of specific applications or more of this consumer oriented stuff. That's just like a different level of throughput that like Ethereum is not getting to anytime soon. Like, like those kinds of things where you can differentiate more like makes sense.

• 24:20Speaker 02

  But yeah, if like all you need is like a pretty vanilla, you know, decent EVM blockchain to just like do some normal stuff, like you should probably just have a layer one that can do that. So you don't have a million people trying to go launch that elsewhere.

• 24:31Speaker 01

  Do you think we'll have an uprising of Ethereum cohort that is going to be like shun L twos as a category broadly? Like the return to greatness, like, hey, like, we don't agree. I've been, I've been catching some shit on Twitter of just like, you're a scam. My youth is a scam because like, it's not, it's not Ethereum mainnet, right? I'm wondering if.

• 24:50David Hoffman?

  Wow, really?

• 24:52Speaker 01

  Yeah, yeah.

• 24:52David Hoffman?

  Ethereum deep culturalist, like a layer one maximalist.

• 24:56Speaker 01

  Yeah. So I'm wondering if that cohort is going to grow after seeing the last few years that like, you know what, going down this path, seeing how successful Solana has been price action wise, adoption wise, that like, maybe this is the right path. And like, I still think they want to preserve their values. I think that's always been the argument that, you know, for anyone who is calling for L1 scaling, just like, yeah, don't try to compete with Solana, but push yourselves to the levels that preserve your, your actual values, right? The essentialization, everything that's useful. I'm wondering if those people are gonna like, if that cohort is going to grow and the calls are going to get even louder and then like what happens in that future?

• 25:31Speaker 02

  I don't think it will get, I don't think it will ever get that meaningful, just kind of almost definitionally, because if that is, I would classify as just basically the most kind of extreme L1 maxi view. And I think if you hold that view, you're, you're just not an Ethereum person.

• 25:46David Hoffman?

  You're missing the point of Ethereum. Yeah.

• 25:47Speaker 02

  Yeah. Like you're, at that point, you are just like, you are a hardcore, like entirely Solana or Sweet or like whatever, insert your other single chain.

• 25:56Speaker 01

  Kind of Bitcoin.

• 25:57Speaker 02

  Yeah, I mean, yeah, possibly even that. But yeah, if you are just like super, all that we care about is the L1 and you see absolutely zero value in any of these other chains that are like have varying levels of relationship to it, I think you're probably just like, you're probably just not a Ethereum person. Like, I mean, like, someone like me, who I think falls in that more middle category, where, you know, have been very positive on Solana and Bitcoin and stuff like that over the past year, critical of a lot of Ethereum stuff, like, I very much fall in that middle camp of like, this is a spectrum and there are degrees to which L2s are beneficial to the L1. There it's like, the value that they provide is definitely not zero. It is definitely not the same as equivalently scaling the L1, but it's definitely not zero. And just like, you know, understanding what to prioritize is a reflection of that. I think

• 26:39Speaker 02

  that's where most people are now, is kind of that middle view of, you know, these things are all helpful to varying degrees. We just got to figure out, you know, where to put the meter.

• 26:47David Hoffman?

  But I do see your, your point, Brad. I think culture and community that surrounds blockchains is always downstream of the technical properties that that blockchain has. And when the technical properties of Ethereum is trying to reweight the importance, elevate the importance of the layer one, I would expect it would follow that members, a certain sliver, a certain fragment of the Ethereum community would start to realign their messaging around like, oh, the layer one is the place to be. And the, the article that I'm writing isn't, isn't trying to advocate for like layer one maximalism, but it is trying to advocate that our messaging as the Ethereum community ought to reflect a higher reprioritization of the importance of the layer one and applications on the layer one. And so I think part and

• 27:30David Hoffman?

  parcel with that will come some flavor of like, you know, fringe Ethereum extreme, extreme people that are always about like, no, Ethereum is the layer one, is the only layer one. Maybe not reject layer twos, but like only talk about the layer one. Like, I could see that, that whatever fringe that there is there growing in weight because that's what the technicals of Ethereum are pointing towards.

• 27:54Speaker 02

  I think that they'll leave and go become economists at Anza, though. I think that's the moral of it.

• 28:00David Hoffman?

  I mean, OK, so what about this thought experiment?

• 28:05David Hoffman?

  So, trying to create this narrative and testing out how the Ethereum community is feeling about things. I saw a Unichain tweet that tweeted out, "Unichain is for DeFi." And I retweeted this tweet, saying, "The Ethereum Layer 1 is for DeFi." Part of that motivation was coming from the idea that if the Ethereum Layer 1 is going to be for anything, it's going to be for DeFi. DeFi is the first and last thing that the Ethereum Layer 1 will optimize, will be good for. And we see Arbitrum also having this messaging. Arbitrum is for DeFi, Unichain is for DeFi. And I am concerned that this branding that some of these Layer 2s have are coming at the cost of the Layer 1.

• 28:46David Hoffman?

  And we, as a community, are allowing these Layer 2s to, you know, take what I think is Ethereum's golden goose, which is DeFi. And so I'm trying to, again, like, elevate the importance of Ethereum Layer 1 DeFi as the main cohort of applications that really make the Ethereum Layer 1 strong. And I don't want, like, you know, it's permissionless to add a Layer 2 to Ethereum. And if it's permissionless to add a Layer 2 to Ethereum, and then also to brand yourself as the home of DeFi, that can be viewed as an attack on Ethereum. Or at least, it's not optimal in terms of value creation for the Ethereum ecosystem, is my claim. And so I retweeted this tweet, saying, "No." Not implying, I'm saying, "No, the Ethereum Layer 1 is for DeFi."

• 29:29David Hoffman?

  And then, of course, I get into a fight with Hayden Adams, who, you know, founder of Uniswap Labs, also sponsor of Bankless. Thanks, Uniswap.

• 29:40David Hoffman?

  But like, OK, so Hayden has done this fantastic job of building Uniswap's V1, V2, V3, and V4, which are great applications. And I'm incredibly grateful that he has built these applications. And I would like to elevate this thought experiment of, what if the Ethereum Layer 1 was so strong that Uniswap didn't feel the need to make a whole entire chain, but only and focused on the Layer 1? Application and the strength of that layer one application. If the layer one is so weak that it actually incentivizes our best application developers to become chain developers instead of app developers. That I'm I'm worried that that comes at the cost of the value and sustainability of the layer one.

• 30:21David Hoffman?

  And so I would I would like to entertain the idea of this alternative universe where Uniswap Labs is solely focused on Uniswap, the layer one application. In the same way that Jupiter is focused on its Dex product on Solana. And I think if I think it's worth considering a failure scenario where if all of our best app developers, the Ethereum layer one app developers all turn into chains, chain infrastructure providers, that might just hollow out the the layer one to a point where why would anyone care about the layer one in the first place? Brett, what's your take?

• 30:53Speaker 01

  Not even that they're going to be chains, they go to be BD teams amongst all the chains to like, right? Like Avi's on 75 L2s, right? So like the man hours it takes to go and do that is probably just as detrimental as going to do like a dedicated chain, right? Now, we were talking about power laws and like what the end state of L2s are and all this shit. But I I, yeah, the it's not, the time is not fungible, right? These people need to make their money and they need to spend their time somewhere. I do start to hear you ringing as this, the maximalism talk, right? We we just came on the back of it of like, hey, you know what? These L2s are starting to be kinda eh.

• 31:30Speaker 01

  But like, yeah, I think this is the thing that's kind of frustrated anyone watching the ecosystem broadly is that like you see this stuff and you see like, yeah, there's some countervailing incentives in doing this stuff. And that does drive time, energy, value, like how how much value we don't know from mainnet. And is is mainnet the the best it can be when that is happening at scale across the the entire ecosystem? So, uh, yeah, I I agree with you. I think that stuff should be for DeFi. I don't know how you message that. Uh, I think you almost have to just accept this, uh, competitive, friendly competition mindset to say that, you know what? Like, these, these things are very real, right? Like, there is a little bit of overlap here. And I think it should be friendly in the sense

• 32:13Speaker 01

  That like Ethereum is now in the position to advocate for itself and say why DeFi belongs there. It's okay for Arbitrum and Uniswap and all these other guys to try to do, or Unichain, to try to say that about themselves too. But I think it's important that everyone stands on the properties that they can grant, because Ethereum has the number one property for a lot of things. And say, this is why this kind of DeFi belongs here. And yeah, if you hope the pie of this entire industry is going to grow, like net long term does not matter, right? Everyone should be successful to a degree if you are dominating in your domain. But that doesn't mean it's not going to be a little frictionful with some of these people that were perceived friends, because you become a competition.

• 32:58Speaker 01

  That's just natural.

• 33:00Speaker 02

  Yeah, I mean, the Uniswap, Unichain one should also be a pretty, I'd say, like, unique, interesting test going forward of, you know, how well is the L1 scaling stuff going? And how much value do you get from these L2s? Because I mean, very literally, they are the interesting hedged kind of, you know, we have a core L1 product and we're building this L2 thing. Like, if it is very clear that the product that they are delivering as an L2 is meaningfully differentiated to the point where the features that they are adding there that you can't have on the layer one, give you a way better product, the users will go there and like, you will just see that in the numbers over time. And if you do not see that in the numbers and you see all of the volume staying on the layer one and the layer one's getting better and you could just provide a better product there, well, then that gets to the point of, okay, well, then we have kind of reset the bar.

• 33:44Speaker 02

  If you could build a good product on the layer one and users are happier here. If you want to leave, like, you need a kind of very good reason to go build this completely different, unique thing. So that will definitely be a very interesting one to see over time. It's like, where does that volume start shifting? And how much better does the layer one get? Can that improve Uniswap on the L1, et cetera?

• 34:02Speaker 01

  They have spiked pretty heavily. Yeah, I'm looking up Unichain's TVL. They're up to 340 million, which has spiked pretty heavily on the 15th. I don't know what happened there. And if that was launched, but it was hovering at basically nothing for a while.

• 34:16Speaker 01

  And like, it just makes me go back to the question of like, if these, these chains are cultural hubs, like, do you go to a chain by? Purely for the features or are you are you going to stay closer to the cultural hub of this stuff? Maybe some unique state that exists on the L1, even if it is not feature complete with Uniswap there. But because you are one hop away instead of two hops away, are you willing to to stay there and participate in uni V3 instead? And yeah, not have all the MEV protection redistribution, all that stuff that UniChain has.

• 34:51David Hoffman?

  Yeah, I'm glad that they are doing both. I really like that perspective, John, of like, oh, well, you know, Uniswap has a foot in both camps. They have a foot on, you know, layer one, layer one volume, and they also have their own chain. As an acid test, I think that's a very, it's an amazing, it's amazing that we have that example to even look at moving forward. I do think that this does kind of resemble the dance that the Ethereum leadership in the Ethereum community and like me as well with when I write this article. And I think just broadly, it's a limousette that as Ethereum reprioritizes its layer one, how does it also retain?

• 35:30David Hoffman?

  This layer two ecosystem, this highly aligned layer two ecosystem, because coming like trying to grow the layer one does come at the cost of the growth of layer twos. In a way, like maybe it's positive sum and that's the best case scenario. And I think that is the, that's the optimistic case and it's the case that I want, and I hope that is true. But we are doing, we are now doing this dance of how do we make our layer twos as customers, customers of the layer one? How do we make sure that they stay happy as we, you know, increase our own competitiveness? Like the, the broad problem with Ethereum is that it has not allowed its own layer one to be competitive. That is the pivot underfoot. We are trying to make the layer one competitive and that includes being competitive with its own layer twos.

• 36:12David Hoffman?

  And so how does Ethereum walk that line between trying to make sure its current layer two customers are happy? While also increasing its own competitiveness at the, at the layer one?

• 36:24Speaker 01

  Yeah, this so this kind of gets back at the I've always hated the L2s are parasitic conversation from from

• 36:33David Hoffman?

  You know who, yeah.

• 36:34Speaker 01

  You know who? Yeah, Kyle, Jesus. So, and I I've always hated it because it's it's not a definitional thing of the construction. It is a philosophical thing in my mind, right? Like, I can launch a layer two on top of of Solana, and I'm not inherently parasitic if I am adding features, if I am just like doing whatever. It's I become parasitic whenever the focal point of the team building Solana, the people within the control of their domain, stop prioritizing their own ecosystem, right? And start diverting resources to specifically help me and push users to me, right? Like, at that point, the argument becomes, yeah, I guess it is a little parasitic because things you're and things inside of your control are pushing things, pushing users, pushing

• 37:17Speaker 01

  fees, pushing resources, whatever, to to develop your chain towards another entity that is directly benefiting from that, right? Then you start getting in the conversation of fees versus moneyness and the value accrual of that. I think that that gets fuzzy because, one, it's not quantifiable, right? Moneyness is just this opaque thing that everyone kind of acknowledges but doesn't know how to quantify. And so I think it doesn't have to necessarily be like, oh, make sure we're serving these L2s like directly thing. It's just like Ethereum should be make the best Ethereum it can be. Like, when I say Ethereum, I'm talking about John and I's Ethereum, like the actual literal chain of Ethereum. And then by making its own area and domain valuable, others will naturally attach to that because it is such a valuable thing, right?

• 38:01Speaker 01

  You're gonna see, even though Toly and Co. specifically have said, like, anything that's not on the layer one is an attack on us, basically. He just straight up says it. And yet, you have a bunch of L2s that are cropping up. You have some some protocols, like a bullet, which is like their their dex, which is or not a dex, it's like a protocol, right? That settles off chain, but that posts up to it. But like, you have other teams coming to the table to develop these things, even though it's not been it's been explicitly like labeled as like an attack on Solana. We don't want to drive value to it because it is something that these guys want to actually build and attach to because they see the the future of a Solana. So I think like L2s definitionally are not just like a parasitic thing that is bad for everyone. I think it's just a re-prioritization, and it could be okay that everyone like has their own priority to make their own stuff the best. And the byproduct of that is everyone wins, in my opinion.

• 38:47Speaker 02

  Yeah, I think the like the sometimes just not satisfying answer to a lot of people is that the reality for this question is it's kind of the same as is X Ethereum. It's like this is a it's a very fuzzy spectrum and it depends on what you're trying to solve for and what you're trying to measure there. Realistically, every single chain and every single application, I would say, has this kind of just spectrum relationship of somewhere between parasitic, symbiotic, and altruistic. I think the outcome that you want in like any kind of free market application and platform is that it ends up somewhere in that symbiotic range because in the exact same ways that L2s are quote parasitic to the L1, so are applications on Solana.

• 39:29Speaker 02

  The whole argument that like the extreme version takes of like they're strictly parasitic is because they're taking away cash flows, the REV that would like otherwise go to the application being on the L1, which is true. But that that exactly the same as an application implementing, you know, a just like better auction mechanism so that they're not leaking a shit ton of MEV to the L1 validators. Now they're keeping more of the money for themselves on their application. Like, is that parasitic by the same measurement that is? And so like this really is just spectrum of, you know, you're going to need to find the point of, you know, what is that split going to be of what is the percent of value? And we don't even know that. I mean, this is a different part of how do you even measure the value being captured? Like, is it from the moneyness? Is it from the cash flows?

• 40:14Speaker 02

  Is it from the whatever? But you have to decide like, how do we kind of want to measure that? And they need to find that symbiotic range of what is the percent that goes to the platform? And then what is the percent that goes to these application builders on top? And my full assumption is like, this is a free market. Everything is going to tend towards those platforms will be able to charge whatever amount of value capture proportional to the actual value that they are providing to those applications. If they're not providing enough value to those applications and those applications are leaking too much value, they will always leave. And so all that you can do as any of these platforms is just very directly like, what are the best services that we can provide as a platform to make sure that these applications like they need to build here, that they that they really do have like lock into network effects here, you know, that we are just shipping them the best product. Because otherwise, like your value capture is always going to leave, whether you're Solana

• 40:59Speaker 02

  or you're Ethereum. Like if Solana is not providing enough value upon fun and they're leaking too much value, they will leave and they will go make their own chain. Like that same thing holds true. It's just like, where is that spectrum and where is that line? All that you could do is just ship the best product, just keep shipping and keep giving them the best product. And you just like, gotta hope that that'll get you the value capture.

• 41:18Speaker 01

  I'm thinking about this stuff, like refocusing on the L1, right? I think we can all assume if that happens, some value will be removed from the current cohort of L2s that have been deployed. The tail end of L2s that exist today are the marginal ones that, you know, Onzgar was talking about, maybe should not have existed. We haven't seen an L2 have to shut down yet.

• 41:42Speaker 01

  I mean, that's, running a sequencer costs money. Having a marketing team and a business team in the dev ops costs money. We're going to have a point, I don't know if it's accelerated now because of this shift, where some of these L2s have to just like close up shop. And they say, you know what, the BHRIS contrast contract exists. You guys can technically still run your own sequencer if you want to do a CTO and like, and order your own stuff and run your own chain. I think that's probably going to be accelerated. And I think that'll be a fun one to navigate whenever it actually does happen. But I think we're going to see that here soon with the reprioritization.

• 42:17David Hoffman?

  That's interesting, yeah.

• 42:18Speaker 02

  Yeah, I think the only notable wind down that we've seen, I think was, you saw it on a technical level, but a different market reason would have been the old DYDX version. DYDX, they're all version. Oh yeah, Aztec is the other one. I kind of forgot about that. Yeah, that would be the other one.

• 42:31David Hoffman?

  They shut that one down just because it was a proof of concept that they needed to just kind of like get into production. Yeah.

• 42:37Speaker 02

  Yeah. And so

• 42:38David Hoffman?

  It was a wind down. That layer two did wind down, yeah. You may have already heard about InfineX. InfineX has, in my opinion, the nicest cross-chain swap and bridge feature that you will find anywhere. It is called Swidge, swap and bridge, and we're going to show you what it looks like. First, we're going to log into my InfineX account with a pass key. Now, there's no seed phrases in InfineX. This is just a one-click setup with biometric pass keys. But in addition to that, my InfineX account is fully non-custodial. So bam, I just logged in. It was two clicks and I'm already into my InfineX account. So let's go make a Swidge. I'm going to go Swidge my USDC that is on base and I'm going to buy Barra Chain, which is a completely different chain. So we're going to Swidge this. I'm going to press that button and then InfineX is going to execute this order, this cross-chain order for me.

• 43:23David Hoffman?

  And now it is done. But actually, I'm not really feeling Barish anymore. So I'm going to go from Barra to Penguins. I'm going to buy a Penguin on Solana. So I'm going from the Barra Chain to Solana. See, no transaction signing, no gas to worry about. You just Swidge across whatever chain that you want with InfineX. That was so easy. Go check out InfineX and try your first Swidge today. In the Wild West of DeFi, stability and innovation are everything, which is why you should check out Frax Finance. The protocol revolutionizing stablecoins, DeFi and Rollouts. The core of Frax Finance is Frax USD, which is backed by BlackRock's Institutional Biddle Fund. Frax designed Frax USD for best-in-class yields across DeFi, T-bills and carry trade returns all in one. Just head to frax.com, then stake it to earn some of the best yields in DeFi. Want even more?

• 44:05David Hoffman?

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• 44:49David Hoffman?

  The fact that Kyle Somani was saying these words is why these words have always like triggered the Ethereum community specifically. Like when is Kyle Somani saying it is very different than when like Ansgar Dankrat or Vitalik says it, the messenger actually becomes like the message. And like the thing that he was leaving out, and the Ethereum community will say like willfully leaving out, like strategically leaving out of that like layer twos are parasitic message is that they are parasitic and symbiotic. Like they both take and give back to the layer one. But I think he was, is and was generally speaking right when the Ethereum layer one is so weak

• 45:30David Hoffman?

  that it could, that it is so easy to leech from. Like with a very weak layer one, a layer two does capture a lot of layer one value. Base optimism, arbitrage can capture a lot of layer one value and that equilibrium is all off. And so if I think if he was being more helpful and more constructive, he would have said the layer one is so weak that layer twos can't help but to be parasitic to the layer one. And when we grow the capacity of the layer one, the equilibrium resets into a perhaps more beneficial spot where the value given back to and the value taken from the layer one is in some sort of sustainable equilibrium that does create a

• 46:12David Hoffman?

  growing of the pie ecosystem, which is always what the Ethereum community wants its layer two ecosystem to be like. The fact that layer twos exist is a trade. You know, you give some value, but you get back value in return and this trade is beneficial. You know, no tariffs on layer twos. And, and hopefully that is kind of like this, this line that we have to dance. To me, I see it so similarly to like the Federal Reserve interest rates. Like we need to have layer one capacity so sufficiently at a particular level that like the marginal layer two really needs to justify its existence. And, and otherwise, like if our, if the interest rates are too low, then too many layer twos will crop up and, and you know, that then they shouldn't have existed

• 46:55David Hoffman?

  in the first place. I think, I see there's a lot of similarities there.

• 46:59Speaker 01

  You know, people have been doing a lot of like, over the years, you've done the, the country analogies, right? And countries and states and whatever. Honestly, and after, this was after hearing the Haseeb versus Gort

• 47:09David Hoffman?

  Podcast.

• 47:10Speaker 01

  Conversation, yeah, the other day.

• 47:11David Hoffman?

  Debate.

• 47:12Speaker 01

  Talk, yep. I, I couldn't help but like analogize.

• 47:19Speaker 01

  Ethereum to the whole of America at that point, right? If we're trying to export dollars, right? As to the rest of the world, right? The rest of the world could be other countries. Like, could you imagine the US getting rid of basically all, all consumption, all usage? And just saying like, hey, just use our dollars. Like, if it wasn't a strong nation and trying to export its thing as money, no one's gonna wanna use the dollars through the rest of the world, right? And that, like, that's what the L2s are, right? Some of these relationships are pretty fickle, right? They don't have to use it if they don't want to. But some want to, because it is a strong thing, or it was a strong thing. And now that it's showing weakness, like, you know, so maybe some of those countries are gonna reprioritize. And, yeah, I just think that, that analog came back to my head whenever I started hearing that conversation. And I just tried to think of a world where America tried to be the dominant asset,

• 48:04Speaker 01

  exporting its money, but was not a strong nation itself, and how that worked out.

• 48:11Speaker 02

  I just like that we went from saying how Kyle didn't help to using two different reasoning by analogies.

• 48:17Speaker 02

  I'm just enjoying that part.

• 48:20Speaker 01

  Beautiful place. I, I just came here, cuz like, I know I teased you guys earlier. I wanna see like how, if this, if this is the, the natural outcome of a roll-up centric roadmap, right? It's like, this is the, the thing that is needed. You gotta drive your own fees. You gotta be a dominant asset. You need to have, have power within this, this power dynamic.

• 48:43Speaker 01

  Bitcoin's the same, the same thing, John. I don't understand how you could be so bowled up on it if it's never gonna drive fees.

• 48:54David Hoffman?

  Okay, Brad's pivoting the conversation to the Bitcoin roadmap here. And so now, now we're, Brad, maybe you can just like, lay down your premise, just one more time, just like, lay it out on the table for us.

• 49:05Speaker 01

  Yeah, like, so look, man, like, I, I think we all understand the, we understand the dynamics of the security budget of Bitcoin, right? Eventually, the thing that is gonna pay for, to secure the network, is gonna go to zero. Subsidy goes to zero, every happening, right? So, that means, with that going to zero, you need usage of the chain in order to drive value to the chain, frankly. Outside of just like, hoping people buy the thing because they wanna buy the thing.

• 49:34Speaker 01

  Ethereum and Bitcoin, as of like, I don't know, I guess a month ago, had basically the same roadmap. We're just like, okay, we're not really going to scale L1, we're going to export this thing to a bunch of other chains. You had the Lightning Network and now you're actually like, there's been a resurgence of Bitcoin L2s. And it's like, now they're largely the same, except Ethereum is programmable at its base layer, where Bitcoin is not, but trying to do op cat, all this shit. And it's like, in the future paradigm of Bitcoin, which is today's Ethereum, it's running into issues with that because you see the value accrual in that situation that you would hope to have at the base level is basically nothing, right? Like, these L2s can extract all they want, they don't really post a lot back to the mainnet, but they actually get to claim a lot of the benefits of it. Yeah, sure, maybe you have a little bit of the export of the moneyness, but like,

• 50:19Speaker 01

  you lose faith of your users, like, there's no fees being driven, like, just value accrual in that world is not great. So if we've lived out that roadmap through Ethereum, and now we're going like, oh, like, maybe that's not the best way to go. You need to have a little bit of a balance here. What is, what is the fix in a Bitcoin world where the Bitcoin cohort is pretty readily saying, "Don't ever do anything on mainnet ever," like, zero? So what, like, what's the solve there and how would they avoid this outcome?

• 50:51Speaker 02

  So I think it's really easy, the Ethereum versus Bitcoin thing, because you're just trying to solve two totally different problems. Like, the entire premise of what we're trying to solve for here with the reprioritization, strategic pivot in Ethereum, blah, blah, blah. It's not, you know, are we trying to fix the chain so that it has a sustainable security budget? It's, how do we make ETH not worth $150 billion? How do we make it like $5 trillion? That is just a totally different, like, problem to solve for versus, "Hey, can we get Bitcoin to a point where it's generating like enough fees that it's probably not trivial to just like 51% attack the network?" And I would say that those are roughly like two order of magnitudes apart

• 51:35Speaker 02

  in terms of difficulty of what you actually need to achieve. Like, it's somewhere in the millions to billions of dollars of Like annual fee revenue that you need to just be like, it's not trivial to go 51% attack the thing. But there's like a sufficient level of security. I think there's also like a non-zero probability that this ends up going away. And you end up with like a pseudo POA realistically cartel of miners. And you're just kind of like, we know that like who's mining the chain and you kind of all trust them. Oh, yeah. That's a long way off. That's a different possibility. But like an absence of that, like you're just trying to solve for a much, much, much easier problem. Like Ethereum is trying to solve for, how do we generate?

• 52:15Speaker 02

  Like you would need tens of billions, hundreds of billions of dollars of RIV per year to like actually reasonably sustain on a cash flow basis. And assets that's worth many trillions of dollars. Bitcoin is just like totally decoupled from that. It's a completely separate issue. And even if you did get like a trillion dollars a year of RIV in Bitcoin, I mean, it's very strictly like not valued on any of that. And it wouldn't even help the valuation of it because like literally all that goes to the miners anyway. Like the economics of Bitcoin from a holder perspective are like set. Like you know exactly what you're going to get. You're going to get inflated every year. Like you're not going to get any value captured out of the network. So the value of BTC is like totally decoupled from can we like generate enough fees?

• 52:57Speaker 02

  It's just a matter of can you generate enough fees such that you like people aren't attacking the chain? And to be fair, I think that like is a genuinely open question. Like there is a possibility that that just like that kind of goes haywire in five, 10, 15 years from now, whatever. That you know, you're not generating enough fees and we don't kind of have a stable enough agreement of, you know, how we're mining the chain. That's like, it's a possibility. It's a tail risk. I think that you just like, you take a positive view. My pretty reasonable assumption is like, that's going to work itself out. Either you'll generate enough fees or by the point this kind of happens, this is so far away that it doesn't matter. And we just kind of follow the chain at that point and we know who's mining it. But we'll see. But yeah, I mean, the very TLDRs, I think you're just like solving for a totally different problem. Yeah.

• 53:41Speaker 01

  And the time horizon is so long that the variables between now and then are

• 53:45Speaker 02

  Yes, it's so far off.

• 53:45Speaker 01

  Basically infinite.

• 53:47Speaker 02

  Yeah. I mean, this is like the classic, I mean, like, I had kind of dunked on this when you tweeted it. It's like, it's like when Justin tweeted this about this, I don't remember, it was probably a month or so ago. And I think a lot of people piled on, myself included, was he was talking about how Ethereum is going to win because the Bitcoin security budget is going to fall apart. And I like, I see this all the time. And I, I think there are genuine concerns, like there is a very non-zero probability that there's a problem with the security budget with Bitcoin at like some later date in the future. It is not going to be the reason that any of these other chains wins on any reasonable time span. Like, you can't bank on the fact that Bitcoin is going to have a security budget problem in like 2038 as the reason why we don't need to like scale the L1 today. That's just like, these things don't make sense, like the users are all going to be gone.

• 54:33Speaker 02

  You will have won or lost at that point. And that's what I think people kind of need to realize with it. I think it's like, it's possibly a problem with Bitcoin in the like the longer term. It's not an immediate short-term problem, and I think it works itself out. Which is also why, I mean, the same thing with these rollups of like, yeah, I don't think Bitcoin rollups are ever going to generate, you know, any kind of fees that are going to justify, you know, a multi-trillion dollar valuation of an asset. It's just, hey, hopefully they're paying enough like reasonably consistent fees that, you know, miners are like doing okay. And I think that's a point that you can probably get to between various L1 and L2 activity on Bitcoin. I mean, I also think that Bitcoin will increase the block size eventually. I mean, they've already increased the block size previously, like even though people don't like to like phrase it as that. But they already have, I think they will in the future.

• 55:17Speaker 02

  People have like very reasonably spoken about that. I think it'll be a lot, ways off, but yeah, I mean, I, I think that on a technical level, a lot of this isn't looking the same. But you just don't end up with the same problems because you're trying to solve for a completely different thing. And I mean, that's why Bitcoin, I think, has an easier time with all of this too. And, you know, will their like L2s stay aligned and more Bitcoin-centric? Is definitionally they will. The only reason for them to zig is because like people really fundamentally want BTC as an asset. None of these other assets, whether it's ETH, Sol, like insert your token of choice, have within an order of magnitude, just like literally user demand of, hey, I want to own and use this asset. And like, it's fungible.

• 56:01Speaker 02

  Like you could deploy a layer two and people are going to want to use USDC or Bitcoin on these layer twos. And like you, like you literally start to see that in the numbers of like I'd seen in the last week, like USDC trading volume on Ethereum layer one surpassed like ETH trading volume. If you look at like WBTC, NCB BTC volumes and like, like amounts held on chains like Base, Arbitrum, like those are all just going up consistently. And that's because like as you break down the technical barriers across these chains, the people are going to use the asset that they want to use. And ETH, Sol, none of these tokens have such an inherent desire as BTC. Like people just want to hold BTC and use that. And so people will gravitate towards those solutions. Everyone else is on hard mode. Like you just have to ship the best technical product.

• 56:43Speaker 02

  Bitcoin is the only special snowflake that gets to sit back and be like, yeah, we got the best asset, like everyone else kind of figured it out and built on top of us. Like they get a much kind of easier ride at it. And you could still screw that up enough, where if you like literally can't build any of this stuff, and the technical solutions are so bad that people can't get reasonable access to BTC, maybe it ends up being a problem. But it ends up being a much easier problem to solve for them because they don't need to solve for meaningful value capture and they have a fundamental user demand to begin with. Like everyone else is kind of building on hard mode. They have a much easier problem to solve.

• 57:13David Hoffman?

  A lot of the problems that we talked about in the Ethereum pivot episode, all of Ethereum's malaise is coming from the decline of the ETH price as it relates to Bitcoin and everything else in the market. And, you know, I have my opinions on this. I'm, I'm very happy that Ansgar Dankrad elevated this idea that, you know, there is a re, a focusing, a strategic pivot by, you know, Ethereum leadership to refocus on the Ethereum layer one for growth of users, for growth of applications, for builders, for all of these things that, that we understand to be good. It was the decline of the ETH price that I think informed everyone that something is amiss. That was the information that the market was telling us.

• 57:59David Hoffman?

  In my, I think Ethereum should just focus on exactly what Ansgar and Dankred said, and focus on that roadmap, grow the layer one, grow fundamentals, grow users, and just don't talk about ETH. We should just not talk about ETH. One of the big problems in the Ethereum community is like, oh, we need to fix our messaging. We need to fix our messaging around ETH. All we need to do is come up with the ETH one liner to sell it to BlackRock and to TradFi, and then we'll fix Ethereum's problems. And that has been like this idea for like three years, and no one has really come up with like the one liner for ETH. We have been pushing on this like narrative problem for ETH for a long time now. No one's come up with a good solution for it. And I think that that's the signal. And while I think it's, I think we maybe like, there are smaller circles. Maybe I'll do a podcast on this, maybe we can talk about this right now of like,

• 58:44David Hoffman?

  okay, what, how do we like think about ETH the asset in 2025? But broadly speaking, I think the Ethereum community, myself included, I'm talking mainly to myself here, should just stop talking about ETH, and just grow the fundamentals of the layer one, grow users, grow devs, market Ethereum, sell Ethereum as a product to the world. And we'll talk about Ether like later. But now is not the time to like try and push on Ether messaging and marketing to the market. And instead, we ought to sell Ethereum the product rather than ETH the asset. That's kind of like my loose take. Brad, what do you think?

• 59:19Speaker 01

  I think John and I solved the messaging a while ago. It's the unstoppable computer. That's the one I settled on. Honestly, and if it's growing its domain, I think it's like that's all the more true, right? As long as it preserves those properties, I think like one, yeah, like talking about price is just, you know, never a good look. And totally notoriously, talking about Sol, he's just always like, dude, it's just there to stop spam. It's like, I don't care. Like, that's its purpose. Like, I don't, I'm building a computer, or trying to build decentralized NASDAQ, whatever. If Solana is useful as a byproduct of my technical ambitions, so be it, right? And I think that should also be the case for Ethereum. And like, if you want a one liner quip, again, I like the unstoppable computer stuff.

• 1:00:03Speaker 01

  If you grow the Ethereum domain while preserving the censorship resistance, the liveness, all that stuff, you still maintain that title of the unstoppable computer. But you're just better at it. You're a better unstoppable computer. And I think that should be the goal, because you get, you get moneyness and usefulness as a byproduct of being the thing.

• 1:00:23Speaker 02

  Yeah, I'm very much on the side of I think a deprioritization of speaking about the asset would be like pretty beneficial. I mean, the practical reality for all these is even for Sol, I would say, is the one that has been the closest at times to like you can reasonably like make an argument for it has a like somewhat reasonable valuation at times. If you take like its peak R A V where it's annualized, it was several billion dollars a year if you annualize it. You could have like an aggressive but you know, defensible multiple on that of like a 30x multiple. And you get to that like 100 billion ish market cap. The reality is like people weren't actually valuing it based on that.

• 1:01:01Speaker 02

  The market is going to give you credit for the fact that this, hey, this whole big computer in the sky, smart contract platform, whatever, DeFi, all this stuff turns into in a few years. Like this is going to be a trillion, multi trillion dollar market. Like what do we want to see is are you winning that market and are you growing? The reality is that's why Sol went up a lot over the past year. I mean, the fact that it has gotten all the R A V is like helpful, those charts are up into the right. It, you know, shows that there is a path to value capture, all of those things. But the reality is, is the market has just completely reweighted its probability of people using this, this is growing. They are much more likely to win in the long term at this point. Like there is a big market to be had here. We don't know what the breakdown is going to be. What like what margin does an L one take on M U V in the long run? Is it 1%? Is it 6%? Is it 15%?

• 1:01:46Speaker 02

  Like, I have no idea. Is that market a trillion dollars, 100 billion? I don't know. You're taking some reasonable assumption, this is a really big market. Who's going to win? Who's growing? You just got to show that. If you show that, things are going to work itself out. And like as a byproduct of doing that, the reality is all of these R A V type numbers for a year. Like these charts are also going to go up into the right. If people using the L want to go like fees are going to go up. No, you're not going to get to a point where you're going to have a strict cash flow in a year or two from now. That's be like, hey, based on this, I can back into a trillion dollar valuation. Like you're just not going to get there. But just winning that market and showing a path to growth and that outcome is like, that's all you need to kind of get that valuation and recognition again.

• 1:02:26Speaker 01

  So I want to look up.

• 1:02:29Speaker 01

  John, you've notoriously pushed back on talking about L1 asset prices broadly because you just like you've said, hey, maybe they're all overvalued. Right? So like Solana is going up because there is something above it that is a smart contract platform that is in Ethereum that says, oh, well, if Ethereum is doing this and it's valued at this and Solana is doing this, it deserves to be here. And that's giving them conviction and buying into something. But like, there is a world in the future where you overprice it at the start and with saturation to the market of smart contract platforms, they all get pulled down. Right? Like that top bar is maybe it was overpriced the entire time. No one wants to hear that. I don't want to hear that. I have a lot of these things.

• 1:03:09Speaker 01

  But that is, that is, that is, that's a potential outcome too, right? What is the value of this thing where we're, we're getting more chains coming to market, right? There is saturation. These fees are compressing because the, the applications atop them are getting better and smarter at capturing their own value. So like, what value does the underlying platform actually provide to these things? And what is that worth? Like, that's a separate conversation. And I was actually going to look back at like, uh, other assets on a smaller scale. And if they displayed the same thing, like I want to look up Doge, right? Doge was one of the first big meme coins and it went fucking, it's the thing. It went to the moon. Like everyone's all excited. I actually was going to go see how close it got back to its all time high. But you could say the same thing for like NFT projects, right? Punks, bored apes, they all went crazy high because they were there. They were the first. Everyone started pricing things against these things.

• 1:03:54Speaker 01

  Market saturation came along, a shit ton of meme coins came, a bunch of NFT projects came and everything started compressing lower because there's just more things. And maybe there's a potential that we just overpriced them day one, right? And then everything just kind of normalizes over a couple of years, the lower. I don't have anything to, like, no questions following that. It's just like, guys, maybe, maybe it all went too high. I don't know. You sound like a Bitcoiner.

• 1:04:21David Hoffman?

  Well, this is why Bitcoiners say 21 over infinity, right? Like, yeah, Ethereum had a moat and dominance for a very long time. But as soon as people learned how to commoditize Ethereum, then 10,000 Ethereum's showed up. You know, Solana, Avalanche, Phantom, now Sonic, like, and all of its layer twos and all the layer twos that Celestia wants to make. And so there's no moat there. And so the only logical strategy is to just do one thing, be finite supply and never advertise any other utility or any other value out of your ecosystem. And, you know, I, once upon a time, thought that that was silly and foolish and I have been proven wrong. Like, that was, it turns out to be a genius level move. For now. For now. For now. For now. Yeah.

• 1:05:07David Hoffman?

  So when we were zooming back to where we were in like 2021, 2022, the ETH BTC price was like at its, at its all time high, December 2021. Not all time high. Sometimes I kind of like over, I think the 2017 all time high of ETH BTC price was just like not actually a good thing to reference against, but you know, ignoring that history. ETH BTC peaked at 0.088 in December of 2021. And then, and then it turned over. And I think it like turned over for a handful of reasons, right? We started pushing users to layer twos. Layer one stopped accruing revenue. Ethereum got credible competition and you know, credible competition was maturing at that time.

• 1:05:50David Hoffman?

  That was right before like the fall of, the fall of the whole entire market in 2022 with it's like, starting with Terra Luna, then 300 capital and then, and then FTX. But like credible competition started to really mature right at that moment in 2021. So John, like, how do you, how do you understand that story? Maybe, maybe I think a possible answer is like, like, don't worry about it. We don't have to like precisely pin down about like why ETH stopped going up versus Bitcoin. But like, if you had to like actually diagnose it or like autopsy it, was it the collapse of revenue, lack of growth at the layer one, lack of user growth, lack of development growth? Like, what do you, what do you think accounts surmounts to all the reasons why ETH BTC stopped growing?

• 1:06:35Speaker 02

  I think it's a mix of a few things over the past few years. I would kind of bucket it. I would put it into two buckets broadly. Or one is, I think that there was more of a reasonable, like somewhat reasonable belief in the market two, three, four years ago, whatever, that Ethereum ETH specifically would actually like credibly compete with Bitcoin. It's like, hey, this ends up being, you know, the non-sovereign store of value, reserve asset, blah, blah, blah.

• 1:07:05David Hoffman?

  Crypto second money, yeah.

• 1:07:07Speaker 02

  Yeah, like it was, it was not the base case, but like people would very plausibly and reasonably believe like, hey, this is going to happen in a few years from now, five years now, whatever, like it could actually win. I think that belief is like mostly extinguished from the market. There are corners of the market that still really believe that. I'd say for the vast majority of the market, that is just like, all right, like this game is over. This is not happening. Or if it's ever happening, this is like 20 years away and we're like, we're not worried about this. This is just like, it's not a thing that we're thinking about in pricing these things. It is so clear that BTC is this special snowflake. I think that like we in the crypto world have a much easier time of like speaking to ourselves in a bubble and telling ourselves like, hey, this is a totally reasonable idea. Like this is this, you know, Ethereum is better. It's got all these cool things.

• 1:07:50Speaker 02

  And then you like realizing you go to talk to a boomer investor and they're like, wait, what does the Ethereum thing do again? Like Bitcoin is the digital gold. Like what are you talking about? And I mean, you like very literally, you see that and I mean, like political stuff in the past year. It's like, there was no serious conversation of anyone in the administration of like, oh, should we have an ETH strategic reserve specially segmented out? Like Bitcoin is the special snowflake. They get the SPR and then everyone else like gets this other thing where like, maybe we dump your tokens or like, maybe we don't. Or like, maybe we put it in the shelves. Like, we don't know. Like Bitcoin is the special thing. I think that like particularly as the space has grown and we are less of just like it or a little crypto bubble. We realize like, oh yeah, the, the normal world is Bitcoin is the special thing. ETH is not competing with money.

• 1:08:32Speaker 02

  And so I think that you just see that price state of like, all right, we can't reasonably compete as a, what is the percent chance that Ethereum ends up flipping BTC as the money? Like, which is one way to price these things. Like, hey, we think this is a multi-trillion dollar outcome. Like there's a 10% chance that it wins. So that's worth, you know, however many 100 billion. I think that probability has like mostly gone away. So that just shrinks kind of like the whole just general smart contract market. I would say relative to BTC, I think that has definitely been happening over the past year. And just like continues to accelerate with all the macro stuff now, like again, like nobody's seriously talking about ETH or any of the other assets in that bucket. It's like, hey, do we see Bitcoin decoupling from the market and trading more like gold, all of those things? So one is that notion just kind of went away. It's like, all right, so now we have this separate, like this is the smart contract bucket,

• 1:09:17Speaker 02

  and nobody is worried about this competing with BTC for now. And then we have that separate question of like, okay, within that bucket, who is winning? And like, I would say undoubtedly, just within that bucket, the relative share and understanding of like, okay, what are the odds that Ethereum wins with even within this smart contract bucket? That probability has been just consistently going down for the past two or three years. People are saying, oh yeah, there's a much higher chance that we didn't think this was real, but like maybe Swan is actually just like the winning smart contract platform in a few years from now. That is like a totally reasonable possibility where I don't think that people would have assigned a meaningful probability to that a couple of years ago. So really, it's just segmenting into these two buckets of there's the money bucket. We've kind of given up on competing for that at least like anytime soon. So we've already decided, okay, we have a smaller bucket here now.

• 1:10:01Speaker 02

  And then within that bucket, the probabilities have also gone down. So that's why you see ETH BTC going down for the first part in part, and then also like Solith and stuff like that keeps going up in that second part. Like even now, in the downturn over the past couple of months, like Solith has just kept grinding up to all time highs, even though like everything's kind of down. But like that is more that second part of just, okay, even within the bucket, the the odds of winning that just continue to kind of decline.

• 1:10:24Speaker 01

  You know, I had two, two comments on that. One thesis was for Ethereum, it's just like productive asset, right? It's like, okay, BTC is out there, digital gold, cool, but like, Trifis bricked up by productive assets. They love yield, right? Bond market is much bigger than gold market. So like, okay, cool, that's there. Get some passive stuff, run some DCF because you can actually do it and then have fun, right? So that was one thesis, our thesis for why they would buy into it. Unfortunately, as part of this value accrual stuff, we're seeing with the L2 or roll up roadmap is just that like the DCF actually kind of breaks down a little bit too, whenever you start doing this shit. And then like you start removing your actual cash flows and then you can't run the model and then things start looking weak across the board. So that is one.

• 1:11:08Speaker 01

  And the other thing is, after seeing like, you know, the Trump tweets about like, you know, buy ETH is I had this latent thing in the back of my head of like, these guys are rerunning the education that we've all had in this space from day one, right? Like, whenever you come in, you hear Bitcoin, like, okay, Bitcoin digital gold, cool, awesome. And then Ethereum's number two on the board, cool, you get Ethereum because it's the big one, it's driving all these values, whatever. So like, kind of this like dumb lag time of like, understanding what is, like, what even this technology is. Like, they're just gonna default ape into some of this stuff and kind of will it into existence, kind of how they are with Bitcoin. The downside to that is that, or not downside, but like, what unpinned that is you start seeing some of these people coming forward are very, very intelligent with how they understand

• 1:11:53Speaker 01

  these, these protocols. And they can actually go beyond that step. So like, yes, you'll have like, the Trumps of the world tweeting, now's a good time to buy ETH because they're doing World Liberty Fire and mainnet. And like, they're doing all of this stuff that we would have done in 2021. But then you have the second class of investors that are coming along that are very intelligent, that understand the conversation, actually are doing the DCF on the actual numbers that are actually happening. And then the education actually runs upstream that way. And then like, okay, those guys aren't actually aping into it because of the things that, that came as a byproduct of the world-centric roadmap and not being able to actually like, do these things as companies.

• 1:12:27David Hoffman?

  There's a lot there. That's a big, that's a big thesis. Yeah, the thesis is that like, the idea is that they are just going through the crypto rabbit hole as we all have, except they are doing it with accelerated fashion and with advisors.

• 1:12:42Speaker 01

  Yeah, it's complex. And like, we're all humans. And like, like, I wouldn't say that they are, like, some of them are intelligent, yes, but there are some people who are materially not as intelligent as others. And I would say people even within this space. And like, they're gonna, they're gonna rerun a lot of the emotional stuff that we did for a lot of the reasons that we did it, because we're all just humans. So I was banking on a level of that and like, seeing again, the Trump people doing the World Liberty Fire tweeting about it and stuff. I was like, It was so obvious to me that by the time they were tweeting that stuff, that that stuff was like not the play. It was like, guys, things are kind of shaky right now. Things are weird, but it's like, these guys are still buying into it pretty hard. It's like, are they gonna, are they gonna run it back?

• 1:13:21Speaker 01

  Like, are they gonna, but, but at the larger scale, because these guys are, you know, the little, the family of the president of the United States? And like, what impact does that have on all this stuff, given how small our industry is relative to the rest of the world? So I think that was, that was in the back of my head is like, maybe, maybe that's gonna happen, man. I don't know.

• 1:13:40David Hoffman?

  I do think, not to make this political, but I'm gonna make it political. The Trump affiliation with crypto is not good for crypto. We have been aligned with a particular person and political side of the political aisle. And a very contentious side of the political aisle. And we were once as like very like neutral technology that just existed that, you know, we were getting oppressed by Gary Gensler. But at least we were neutral. And now like the association, the branding of crypto is very just so political now, and I wish that that wasn't the case.

• 1:14:15Speaker 02

  I prefer being liked by one side, especially when that one side is winning than being disliked by both sides. I will say that.

• 1:14:24David Hoffman?

  Is that where you're saying that we came from?

• 1:14:26Speaker 02

  Yeah, I think we were more, we came from, we were disliked by both sides. I mean, like literally Trump's first term, like he did not like Bitcoin. He was like, this is.

• 1:14:33David Hoffman?

  He put out a negative anti Bitcoin tweet, I'm a fan of the US dollar, but that was it. There was no.

• 1:14:38Speaker 02

  Yeah.

• 1:14:39David Hoffman?

  Oh, there was Secretary Mnuchin trying to ban self-hosted wallets. So there was that. There was that.

• 1:14:44Speaker 02

  In general, I would say the regulatory environment was, I mean, it was still, a lot of it was still just early of like people just understood it less. There was a little more apathy compared, obviously during the Biden administration was much more aggressive. But I like, I wouldn't characterize it as a positive, just general sentiment or regulatory environment previously. So I. I mean, I agree. I would obviously like for it to be neutral and like be apolitical. I would say it was probably a good bet, though, for the last four years, at least at this point. That particularly, I think it was at a relatively pivotal time of, I think, if you're able to take advantage of it and get a lot of legislation through the next few years. And then hopefully, I think it will move to being much more just nonpartisan over the next couple of years.

• 1:15:26Speaker 02

  Like, I think both sides of the aisle are going to realize, I mean, it just doesn't make sense to be anti-crypto. It's like being anti-dogs, like, there are a lot of people who like dogs, like, there's not a lot of people who like hate dogs. It's the same thing with crypto, like, there's a lot of people who like crypto and like will vote for you for it. There's not a lot of people who are going to vote for you, like, explicitly because you're anti-crypto. And like, I think most politicians on both sides have realized that, like, you can lose an election because of it. But like, it's not going to win you any votes being anti-crypto. I think that we are finally moving to that regime. And then we have to fix the like, okay, but there is still some level of negative sentiment on both sides, particularly with all of, I'd say, problems that we've had over the past few months with a lot of stuff that doesn't look great, being politically motivated and stuff like that, using crypto.

• 1:16:09Speaker 02

  But, yeah, I'd still say I would take the current environment certainly over where we were, you know, a year ago, or previously.

• 1:16:15Speaker 01

  Do you think they warm to it whenever they see the the level of dollars exported through stablecoins? Like, it's becoming such a thing that, like, now we're even talking about it encroaching on, like, the native value of L1s, right? Where I'm saying, like, these things are, stablecoins are parasitic to Ethereum, right? Because it's just, it's taken over the flows, like, they're blown up in volumes, like, they're going crazy. Do you think, from a non-crypto perspective, seeing the strength of the dollar in our ecosystem that is continuing to grow and the use cases that come from that, that that specifically will help them warm over the next few years?

• 1:16:48Speaker 02

  I think it's going to be different for different people. I think the stablecoin thing is probably the most useful at a direct political level. Because you just have a lot more people who are just thinking strategically in terms of like, okay, how, you know, they have a lot of foreign policy objectives and just like monetary objectives.

• 1:17:04Speaker 01

  It convinces smart, important people.

• 1:17:06Speaker 02

  Exactly, yeah, that is what stablecoins does. I, my guess is that it's not, it's not gonna be the type of thing that probably like swinging public sentiment like that much in the US.

• 1:17:13Speaker 01

  Public sentiment doesn't care.

• 1:17:14Speaker 02

  Yeah, I mean, this is not the kind of thing that the average person cares about that much of like, oh, are we helping export dollar dominance and like lower our yields and finance our debt by doing this? Like, if they're not using it when they go buy Starbucks, like, they probably just don't care about it. So, I, I think a lot of stablecoin stuff will be very helpful on the political side. I mean, a lot of that trickles down to into what the public sentiment is. But, the, the onus is on crypto for us to ship like actual consumer-facing products that people use and understand, for people to like actually think of those things and not meme coins when you talk about crypto. I, I mean, this is part of why I, I think a lot of like meme coin hate gets overblown. The internet gets used for terrible things. The reason that people fixate on meme coins within crypto is because meme coins are just louder than all the things that we are doing good in crypto.

• 1:17:58Speaker 02

  We have not built enough like consumer-facing apps that should obviously drown out all those bad things. The internet is used for terrible things. But like, no one would question that like, the internet is bad because you use it all the time, you use it for great things. Like, all these consumer-facing applications that we're using the other day. Like, crypto just needs to do that. And then you will have much more positive sentiment where the average person just thinks of, oh, I think of this app on my phone, as opposed to, oh, I hear about the silly meme coins all the time. It just needs to be a more present and important like consumer-facing products, just like basic financial products. Once you get that, then people will be more positive. But yeah, all the stablecoin stuff is definitely super helpful on like the political side particularly. Because it obviously helps with a lot of potential like US objectives.

• 1:18:40Speaker 01

  Political side in the US, and then I would say consumer outside of the US. I think like that's, that's, that is the hard thing within, like, you don't sell dollars to a, to an American because like we have access to dollars, it's easy, it's stable, it's like, it's a secondary thing. We have Y's, we have, you know, Venmo, all this shit's easy. But if you send it to, to someone in Turkey or someone in, you know, Uganda, right? Like, there is value there because it is materially different than their, their day-to-day. Which is why you're seeing adoption internationally.

• 1:19:08Speaker 02

  Yeah, exactly.

• 1:19:10David Hoffman?

  Brad, John, as we wrap this up, we are actually missing a person who was potentially going to be on here as a fourth person, but they just said they were sick. We are potentially thinking about doing this on a reoccurring basis. I enjoy chatting with you guys. I think you guys are wicked smart. I think you guys are great conversationalists. And I think if the bankless community likes this episode, they should let us know because I'm peaked about what we could talk about now and into the future. Maybe we can look forward about a week. The Ethereum community is digesting the whole pivot thing. They're going to digest this episode. We're talking about content coins right now. I don't know if those excite you guys or not, but overall, I'll kind of just give you guys the podium for a moment. Just what are you excited about right now? What are you, what are you looking forward to? Brad, I'll start with you.

• 1:19:53Speaker 01

  Well, now that content coins leads to an airdrop, like everyone's perspective on it has changed. Jesse's been helping everyone out for the last few weeks, but no one realized it. Yeah.

• 1:20:02David Hoffman?

  Do you think he knew about the Zora announcement when he was doing this whole push? Cause this, the timing is a little sus.

• 1:20:10Speaker 01

  It's, it's sus. I, so look, I like Jesse. I think he's a good guy. He says he wasn't aware, so I'm going to take him at his word.

• 1:20:15David Hoffman?

  Oh, he said that? I missed that. If he said that, if he said it, I believe him.

• 1:20:19Speaker 01

  Yeah. If I'm recalling correctly, I'm pretty sure it was on the timeline. He said like, no, no awareness. He's like, I just truly believe in this. So like, if that's the case.

• 1:20:26David Hoffman?

  I do believe that.

• 1:20:26Speaker 01

  Yeah, I'll give him, I'll give him benefit of the doubt.

• 1:20:29David Hoffman?

  For sure.

• 1:20:30Speaker 01

  But yeah, for me, like, we're actually, you know, when's this, this is going to drop tomorrow?

• 1:20:33David Hoffman?

  It's going to drop tomorrow, the 23rd.

• 1:20:35Speaker 01

  Okay. So then whoever's reading this, go check out the Mega Mafia 2 drop. We actually, our accelerator just launched. It'll be tomorrow morning for us, but today for the people listening to this. Yeah. So we're getting an accelerator spun up for Mega ETH. And then, yeah, getting out there and playing. I actually want to play in the hyper EVM ecosystem a little bit more.

• 1:20:54David Hoffman?

  Cool. John, what's exciting you these days?

• 1:20:57Speaker 02

  I'm a boring guy. I like Bitcoin and stable coins. And like genuinely, those are the things that I'm most excited for this year are like super basic stuff.

• 1:21:05Speaker 01

  Investing in them or like, what, like, what's the just?

• 1:21:08Speaker 02

  Both.

• 1:21:08Speaker 01

  Products.

• 1:21:10Speaker 02

  Yeah, I both, I would say. I like, I am very Bitcoin is the monetary asset. I think that will just continue to just be more obvious. I think that's becoming like more present now with a lot of just geopolitical uncertainty. I think that will just like only continue to be the case over the next few years. I think it will become a more globally important monetary asset. I think that like seems very, very likely. I think stable coins are going to be more important. Like, I'm very on the, I think, most of the stuff that crypto is good for. We kind of know what it's good for. It's a lot of the basic stuff. It's money, self custodial, non sovereign value. It's sending around the dollars around the world really fast and cheap. Getting it to people who don't have easy access to it, all that stuff. I like, I actually tend to be one of the people who gives a high degree of freedom to, you know, the Zora and base, whatever.

• 1:21:55Speaker 02

  Like, I will give a lot of benefit of the doubt to, you know, we should try new things. You don't go out there, go experiment. I also don't think it's going to work. I don't think the core idea is like probably going to stick. But like, I like to see people experiment with a lot of these like very consumer, more social centric applications. It's great. Get stuff out there. Hopefully, we can get some applications that more normies use. Get a more positive association with crypto. I think that's a ways off. Yeah, I really like the basic stuff. The basic stuff crypto is great at it. We don't, we don't need to find these like million unique crazy new things that crypto is good at. We know crypto is good at.

• 1:22:33Speaker 01

  Six contracts?

• 1:22:34Speaker 02

  Really good at it.

• 1:22:34Speaker 01

  You're a six contract believer?

• 1:22:37Speaker 02

  Directionally, yeah. It is, people take that as a pessimistic view, but I don't think that people realize that most of the people who think that there are six smart contracts is just like, it is a useful way to say that those six smart contracts are really, really big. And like, most of the stuff that we call consumer applications, like we can call them information finance and prediction markets and like creator monetization. Underneath, it's, it's the same smart contracts. It's like launching new tokens and trading tokens underneath. Like, what is the core mechanism underneath Polymark and Zora and all these? Like, it's launching new tokens and trading tokens. It's the same idea.

• 1:23:11Speaker 02

  That doesn't mean that there aren't like a million use cases for it. I think this is a gazillion use cases out there for it. But the basic stuff that crypto rails are good at, we know. And I think the basics are really going to shine over the next year. And I think that you like, you will start to see it be more serious and more important on a global level. When you see Bitcoin as an important macro that you see stable coins like actually becoming a real thing that governments are starting to think about of, oh, this is like a real thing that people are using at scale in all these foreign countries. Like, what do we do about this? What is the regulation going to be? I think all of that's going to be really exciting for the next year. I'm hyped for it.

• 1:23:40David Hoffman?

  Yeah, yeah. I do think that there is a conversation that I'll just, I've talked about this with Haseeb, and I'll name the conversation. Maybe we can pick this up at a different time because we're running out of time here. But there's like the barbell idea of crypto, where you have Bitcoin on one end and stablecoins on the other, and the middle is thin. The middle is, the idea of coining content is not mainstream. The idea of like this smart contract, digital nation in the sky with like NFTs for identity, like that part's not real. That's thin. And that's like the barbell, Bitcoin stablecoin barbell, nothing in the middle. And then there's like the other thing in the middle, which is like Ethereum richness, like on-chain culture, crypto culture,

• 1:24:21David Hoffman?

  whatever was the vision of 2021, like on-chain metaverse, what are, you know, all of these things, consumer applications, coining content. That's like the middle of it, where on-chain richness is what I'll call that. And on-chain richness is, in this present era of crypto, not winning that tug of war. The current tug of war is being won by Bitcoin as a global reserve asset and stablecoin as payments. And those two ends of the crypto barbell are very, very strong. Now, the pendulum, I think, shifts back and forth, and the pendulum's weighted towards Bitcoin and stablecoins. I'm personally here for the on-chain richness. That's what excites me. And so I'm looking forward to that pendulum kind of pointing back towards the middle. That's kind of how I identify the current state of play.

• 1:25:02Speaker 01

  I think the gold nugget there is that the on-chain richness is probably going to grow proportional to the other two, right? Like if both of those things go up astronomically from here, there's going to be so much liquidity and volume and just straight up money in the ecosystem that the splash-on effects of that will grow a lot of stuff exponentially from here. Like, or at least that's the hope, right? Is that like, because there's just, there is a lot of velocity in the ecosystem, because you're one hop away from Bitcoin at 500,000, like that's going to fall into some, someone who got that early, they didn't sell the pizza, or didn't buy the pizza, right? They decided to buy the node monkey, and then they would try to take that over to go buy it and are swapping into a CryptoPunk, right?

• 1:25:47Speaker 01

  So like, that level of crypto culture stuff, I think, is just going to be downstream of that and proportional to it, to a degree, just because you are so close to it.

• 1:25:56Speaker 02

  Yeah, the literal dollar trickle down for BTC going up has clearly reduced to the rest of alts over the past few years as you get just a very different buyer base for the asset. But it's still there. It's still a like non-zero trickle down and you get a lot of the soft benefits around the edges of whether that's, I mean, just positive sentiment, regulatory, much more clarity as a result of the hey, these serious things are being built. And then stablecoins are just, I mean, they're just good consumer products. They help you build just like actually good consumer-facing products and get people on chain, you know, getting used to the idea of self-custody and wallets and like, what are these rails? They're a great way to just get people in. And then that gives you the freedom of like, hey, more people understand this stuff, more people using this stuff.

• 1:26:39Speaker 02

  We have regulatory clarity, we have all those things, even if it's not like literally the price is going up. It obviously benefits everyone if, you know, Bitcoin is a legitimate asset around the world and people using stablecoins and we're building out the rails here and we have clarity and all those things, like, that's great for everyone here.

• 1:26:52David Hoffman?

  Brad, John, I thought this episode was great. Really appreciate you guys coming on the show and just hanging out with me today.

• 1:26:58Speaker 02

  Yeah, thanks for having me.

• 1:26:59David Hoffman?

  Bankless Nation, you guys know the deal, crypto is risky, you can lose what you put in, but nonetheless, we are headed west. This is the frontier. It's not for everyone, but we are glad you are with us on the bankless journey. Thanks a lot.