ROLLUP: BTC Halving is Here! | Worldcoin's New Chain | China ETF Approvals | Solana Chain Upgrades

Bankless Friday Weekly Rollup 3rd Week Of April ------ 🔐 SAFE | BUILD WITH THE SAFE SMART ACCOUNT https://bankless.cc/Safe_pod ------ 📣SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium ------ BANKLESS SPONSOR TOOLS: 🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE https://k.xyz/bankless-pod-q2 ⁠ 🔗CELO | CEL2 COMING SOON https://bankless.cc/Celo 🔐 SAFE | ATTEND SAFE{CON} https://bankless.cc/SafeCon ⚖️ ARBITRUM | SCALING ETHEREUM ⁠https://bankless.cc/Arbitrum 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🗣️TOKU | CRYPTO EMPLOYMENT SOLUTION https://bankless.cc/toku ------ TIMESTAMPS 00:00:00 Intro 00:03:37 Bitcoin Halving https://www.coinwarz.com/bitcoin-halving 00:07:23 Bitcoin Runes https://youtu.be/q9RDE8U6CkI 00:08:56 Markets https://pro.kraken.com/app/trade/btc-usd https://twitter.com/dunleavy89/status/1779120479233544261 00:15:29 ETH Price Updates https://pro.kraken.com/app/trade/eth-usd https://twitter.com/dmihal/status/1779244625762394235 00:19:18 L2 Updates https://l2beat.com/scaling/summary https://twitter.com/NTmoney/status/1780998133025226803 00:24:27 World Chain Announcement https://twitter.com/worldcoin/status/1780611997396095157 https://worldcoin.org/blog/announcements/introducing-world-chain 00:28:19 Dead Internet Theory https://x.com/tiagosada/status/1780616673172570532 00:30:20 OKX X Layer Launch https://www.okx.com/xlayer 00:34:45 Kraken Wallet https://twitter.com/krakenfx/status/1780612343354855625 00:37:15 Hong Kong ETF Approvals https://www.cnbc.com/2024/04/15/hong-kong-regulators-approve-spot-bitcoin-and-ether-etfs-.html https://twitter.com/EricBalchunas/status/1779867078603718970 00:42:25 Ethereum Superwallets https://twitter.com/sassal0x/status/1778616483838669202 https://twitter.com/0xCygaar/status/1778522744919044442 00:47:48 Eigenlayer Unpaused Restaking https://x.com/eigenlayer/status/1778885106960081116 00:50:06 Alt Restaking https://twitter.com/nektarnetwork/status/1778082320798380060 https://twitter.com/Karak_Network/status/1777370872627831019 00:54:24 Immutable Nexus https://twitter.com/Immutable/status/1777894966498607146 00:56:58 Crypto The Game https://x.com/BanklessHQ/status/1780994358260420807 01:00:57 HeroGlyphs https://twitter.com/hero_glyphs https://github.com/Finallyt/Heroglyph/blob/main/Heroglyph-Whitepaper.pdf 01:05:35 Solana Upgrades https://x.com/SolanaStatus/status/1779727821834686592 https://twitter.com/rexstjohn/status/1779730912269500836 01:07:34 Stablecoin Bill https://www.lummis.senate.gov/press-releases/lummis-gillibrand-introduce-bipartisan-landmark-legislation-to-create-regulatory-framework-for-stablecoins/ 01:10:40 Raises https://twitter.com/alignedlayer/status/1779564155327934811?s=46&t=dAxCjT2P_GIrJMvMgWIpfA https://twitter.com/alignedlayer/status/1779564155327934811?s=46&t=dAxCjT2P_GIrJMvMgWIpfA https://x.com/nebrazkp/status/1780633313155457091 01:13:40 Meme of The Week https://vxtwitter.com/Timccopeland/status/1781012538911551808 ------ 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.

• 0:03Ryan Sean Adams?

  Thankless Nation, it is the 3rd week of April. It's a special week. This only happens once every 4 years. I'm talking about the Bitcoin Havening. David, it is Bitcoin Halving Week. How are you celebrating?

• 0:16David Hoffman?

  I'm actually throwing a party on your ass.

• 0:18Ryan Sean Adams?

  Are you really?

• 0:19David Hoffman?

  Yeah, yeah. Which all my friends are like, "Why are you throwing a Bitcoin party?"

• 0:23Ryan Sean Adams?

  Is it a having party?

• 0:24David Hoffman?

  Yeah, it's a having party, yeah.

• 0:25Ryan Sean Adams?

  No way. What do you do? Like, what do you do for a having party?

• 0:28David Hoffman?

  I invite friends over and I feed them drinks.

• 0:30Ryan Sean Adams?

  Talk about Bitcoin.

• 0:31David Hoffman?

  Yeah, talk about Bitcoin.

• 0:32Ryan Sean Adams?

  Talk about sound money.

• 0:33David Hoffman?

  Yeah.

• 0:34Ryan Sean Adams?

  Hand out the Bitcoin Standard, St. Pete's Moose.

• 0:37David Hoffman?

  Well, you know, I have a signed copy of the Bitcoin Standard by St. Pete's Moose.

• 0:41Ryan Sean Adams?

  I know you do. This is a true story.

• 0:43David Hoffman?

  It's addressed to the shit corner, which is me.

• 0:46Ryan Sean Adams?

  Yeah, well, that's great. That's accurate as well. So, we gotta start with that, though. We gotta celebrate that, because it happens only once every 4 years. And I think this is our 2nd Havening as a Bitcoin podcast, so...

• 0:59David Hoffman?

  As a Bitcoin podcast, that's right.

• 1:00Ryan Sean Adams?

  That's funny, that was actually a slip of the tongue. I did Bitcoin Podcasts, like, keeping it in. So, you're having this party, David, but the Havening is scheduled to happen on Saturday. The big question, I think, in everyone's mind is, is this going to be bullish or bearish for Bitcoin prices? What about my bags, David?

• 1:16David Hoffman?

  We got some takes in the show to talk about that. Willcoin and OKX are releasing their Layer 2s. Do we need more Layer 2s? How will they differ? Will they bring new users on-chain? In addition to more Layer 2s, Kraken is also opening up their own wallet, their beautiful wallet, which I've got my phone, we'll debut that here in a second. What's the deal about the Kraken wallet? Open source, privacy first, it's great. What else we got to talk about, Ron?

• 1:39Ryan Sean Adams?

  Hong Kong, they are front-running the US. They just got their Ethereum ETF, okay? In addition to a Bitcoin ETF, they got an Ethereum ETF. So, the question is, does this mean big inflows in Asia? We'll talk about that. And, the next Ethereum upgrade is going to make Ethereum wallets great again. They could use an upgrade, I would say, so we'll talk about that. Also, alt-restaking is now a thing? Question mark? What is this, non-EigenLayer Restaking?

• 2:04David Hoffman?

  And then last up, Solana is patching their chain, deployed a patch to account for some of the transaction spam that's going in. And now, Solana is no longer broken. Solana is now fixed, but there is still a roadmap to perfect the engineering around the Solana ecosystem, so we'll talk about that. And more.

• 2:20Ryan Sean Adams?

  Perfection, huh? Search of perfection. We're all in search of perfection.

• 2:23David Hoffman?

  Perfection, perfection of engineering, yeah.

• 2:24Ryan Sean Adams?

  Okay, so before we get in, we got to shout out our friends over at Safe Wallet. It is account abstraction season. I feel like this is going to be a massive year for Ethereum wallets. Safe is the wallet that Bankless uses to secure all of its funds. So this has been a wallet we trusted for a while, and they got something cool coming up. What do they want folks in the Bankless Nation to know?

• 2:45David Hoffman?

  Yeah, so a Safe is actually probably everyone's first account abstraction wallet, especially on the Layer 1. They've held over $100 billion of TVL since Nosa Safe was deployed like forever ago. Safe is building the on-chain ownership layer with now smart accounts. They're trying to forge a future where smart accounts are embedded within every app on the web, on the entire internet, not just Ethereum, so we can give the internet ownership over assets and data and identity. They want you to build with a Safe smart account. There is a link in the show notes, so you can get started building with a Safe smart account. And also, they want you to go to SafeCon, that's May 23 in Berlin. So if you are interested in building with Safe, or building an account abstraction, or you're just in Berlin or Europe, go to SafeCon.

• 3:30David Hoffman?

  There's a link in the show notes for that as well.

• 3:32Ryan Sean Adams?

  David, before we get to the prices, though, and markets, I think we need to spend a minute to talk about the Bitcoin having.

• 3:38David Hoffman?

  More having, more having content.

• 3:40Ryan Sean Adams?

  Yeah, more having content on this Bitcoin podcast that you've come to appreciate. All right, so we are, according to this timer, we are at the time of recording, one day until the having. So does this mean...

• 3:52David Hoffman?

  One day and six hours.

• 3:53Ryan Sean Adams?

  Is this going to happen on April 19, then? By the time people get this episode, will it be happening day?

• 4:00David Hoffman?

  I think it actually might depend on where you are in the world. I think only maybe Hawaii is going to have the Bitcoin having on 4/20. Everyone else will have it on 4/19.

• 4:10Ryan Sean Adams?

  Oh, okay.

• 4:11David Hoffman?

  So I think this happens like 10:00 PM. Like 10, maybe the West Coast also has it in 422. I think this happens like 10:00 PM Eastern Time on Friday tomorrow, today for the time of listeners.

• 4:22Ryan Sean Adams?

  Do we need to recap like what the happening actually is?

• 4:25David Hoffman?

  God, I hope not, but I think we're gonna do it anyways.

• 4:28Ryan Sean Adams?

  Okay, so what is it?

• 4:29David Hoffman?

  So for every 210,000 blocks, so 210,000 blocks times 10 minutes gives you approximately every four years, the Bitcoin reward for mining a Bitcoin block gets cut in half. The Bitcoin reward for mining the first Bitcoin blocks was 50 Bitcoins per block, back when Bitcoin was literally valueless. And then it went from 50 to 25 in 2012. It went from 25 to 12 and a half in 2016, 12 and a half to 6.25 in May of 2020. And now, tomorrow, and today for listeners, it's going to go from 6.25 down to 3.125 Bitcoin per block.

• 5:07Ryan Sean Adams?

  So this is the fourth one out of, you know, I guess there's been three previous, and we have some history. So a question in everyone's mind is, what is price going to do? Because everyone knows this is written in the code of Bitcoins, been here since inception. Everyone knows what's going to happen. There's always this question of, have people front run this? Is the market already priced it in? What's going to happen to price? This is a tweet from Bitwise doing some analysis on this. What do they say?

• 5:32David Hoffman?

  They just basically show the returns on Bitcoin for the year after the happening. And so for 2012, it was a whopping 8,800% price appreciation.

• 5:42Ryan Sean Adams?

  Oh, okay. Is that what we can expect?

• 5:44David Hoffman?

  Sorry, Bitcoin listeners, you should not be expecting that. In 2016, it was 285%. And then in 2020, it was 550%. So we have yet to have, out of three data points, we're about to have the fourth, we are yet to have a bearish year post-happening for Bitcoin.

• 6:03Ryan Sean Adams?

  Historically, it's always been real good.

• 6:05David Hoffman?

  Real good.

• 6:05Ryan Sean Adams?

  After the happening, between 285% and 8,839%.

• 6:10David Hoffman?

  I will say, actually, so both 2016 and 2020, which were very strong performing years for Bitcoin, it was actually the year after those years that were the better of those two years. So in 2016, Bitcoin was up something like, like 1,000%. And in 2021, Bitcoin was also up something even higher.

• 6:26Ryan Sean Adams?

  Now, people say this time could be different, of course, because like maybe we maybe we front ran some of that demand. We got a Bitcoin ETF in January, which was a few years. We've never had a Bitcoin ETF before, so maybe it's different in that way. But also, there's something that happens in the month following the halving, which is the month we're in. So if you're like a near-term one-month trader, what has traditionally happened in the month after the halving?

• 6:47David Hoffman?

  Nothing significant. In 2012, we were up 9%. In 2016, we were down 10%. And in 2020, we were up 6%. And so basically, it's saying, hey, like, zoom out, think long-term, don't think about, like, don't buy Bitcoin now because of the halving is tomorrow. Like, think about it on like a longer timeframe than that.

• 7:06Ryan Sean Adams?

  I mean, you say it's not significant, and I agree, like, but the significance is it's super flat in the month after, right? And then, like, so don't expect this to get like immediately priced in. I mean, the market's kind of anticipating this, I suppose.

• 7:19David Hoffman?

  Everyone has seen the halving coming. It has been in the code since Jasis.

• 7:23Ryan Sean Adams?

  Yes. All right. So there is something that is actually shipping with this halving, and has nothing to do with the Bitcoin core protocol. So it's not like the code itself is undergoing any upgrade, but simultaneous with the halving is the shipping of Bitcoin runes. What's the significance of that? Why is that happening on the halving?

• 7:44David Hoffman?

  Yeah. So if you are paying attention to Bitcoin land, runes is like the very hyped thing that is being released. The code, the core, the Bitcoin software for runes is being released tomorrow. This is Casey Rotemore, who created Bitcoin ordinals, NFTs on Bitcoin, using Bitcoin as like a data availability layer of sorts, just to inscribe JPEGs on the Bitcoin blockchain. He has since figured out a way to do a very similar thing, creative construction of the nooks and crannies of Bitcoin block space, to produce fungible tokens inside of Bitcoin, like enshrined on the layer one. This is not a layer two on Bitcoin. This is not like a sidechain to Bitcoin. This is inside of the layer one,

• 8:24David Hoffman?

  fungible tokens, using Bitcoin block space. And so this is a very hyped thing in Bitcoin land. This is launching with a halving. We did a show with Casey yesterday. It came out yesterday, if you want to learn more about it. One of the more hyped things that I've heard in the

• 8:38Ryan Sean Adams?

  I think it's a big deal. I think I think these are like more like the most legit Bitcoin tokens idea that we've seen so far. And why is Casey releasing this on having just because?

• 8:49David Hoffman?

  Why not? Yeah.

• 8:51Ryan Sean Adams?

  Yeah, why not? So it's nothing to do with he's just chose this as a shelling point. Very cool. All right. So what about prices on the week? Where are we at on the Bitcoin price?

• 8:59David Hoffman?

  Down about 10% start of the week, a little bit above 70,000 currently at 62 and a half thousand dollars.

• 9:08Ryan Sean Adams?

  Thanks to Kraken Pro for these charts, even though they are down.

• 9:11David Hoffman?

  I wish make them go up.

• 9:12Ryan Sean Adams?

  Yeah, please Kraken, help us with that. I feel like it was a rough week. Look at some of these red spikes downwards.

• 9:18David Hoffman?

  It has been a rough couple of weeks.

• 9:19Ryan Sean Adams?

  Yeah, it's just like, especially over the weekend, there were some spikes downwards and the question, of course, when we go down, mostly when we go down, people don't ask these questions.

• 9:28David Hoffman?

  Why did we go down?

• 9:29Ryan Sean Adams?

  When we go up, it's like, oh, we knew this was gonna happen. It's inevitable, you know? But like when we go down, we need some sort of rational explanation for this. And there are a few different explanations people have turned to. What are they?

• 9:42David Hoffman?

  Well, there's always the tax scapegoat. So April 15th was tax day in the United States. Is it is it tax day just in the United States? Or is that like a global day?

• 9:50Ryan Sean Adams?

  Oh, that's a good idea.

• 9:51David Hoffman?

  Do other people use April 15th for taxes? Or is it just us?

• 9:54Ryan Sean Adams?

  I don't know. I, you know, I honestly don't know. I've never paid taxes, income taxes in another country, David, so I just don't know. But so April 15th, you have to get your, you have to pay your taxes.

• 10:04David Hoffman?

  And so like, if you don't have the money in your bank account, then you have to sell your assets in order to pay for your taxes.

• 10:08Ryan Sean Adams?

  Do you think people do this? Do you think people are like, it's April 14th?

• 10:11David Hoffman?

  I don't know what other people's strategies are.

• 10:12Ryan Sean Adams?

  Oh, no, I owe like thousands of dollars. I better sell some Bitcoin to go pay this.

• 10:18David Hoffman?

  Yeah, like if you are like buzzer beating, the selling of your assets to pay for your taxes is, do people do that? I don't really know. This is why people always don't really know, like whether the tax sell off is real or just noise. But we can use it as a scapegoat.

• 10:32Ryan Sean Adams?

  It could be one of those reflexive things where everyone thinks it's a thing, so it becomes a thing.

• 10:36David Hoffman?

  So anyways, it's scapegoat number one, taxes. Scapegoat, another number two, Iran versus Israel. Markets do not like uncertainty. They do not like war. They do not like instability. And so over the weekend, Iran sent some drones and missiles over to Israel, which were intercepted. People were worried about this being escalating into a regional conflict. The meme is that this would turn into World War III, which is definitely bad for markets. And so that's scapegoat number three.

• 11:04Ryan Sean Adams?

  You say scapegoat. This one, to me, felt kind of legitimate, though. Over the weekend, I was like, what, drones and missiles?

• 11:09David Hoffman?

  I was also slightly worried, yeah.

• 11:12Ryan Sean Adams?

  Okay, all right. So maybe some legitimacy there, at least from my perspective. What else we got?

• 11:17David Hoffman?

  Scapegoat number three, BTC inflows kind of muted. We've actually had not any net new inflows into the Bitcoin ETFs for almost like a month now. So while there are increasing, there are flows into the new Bitcoin ETFs, there are similar outflows out of grayscale. So there's no net new TVL going into the Bitcoin ETFs for about a month, which is coincidentally how long we've been about flat for.

• 11:42Ryan Sean Adams?

  Okay, so maybe inflows have kind of like stopped and people see that and they're like, okay, well, the ETF party's over. What else we got?

• 11:50David Hoffman?

  Scapegoat number four, stock market's down, actually. So the SPY is actually like a good 50 points off its high. So down like, I think 15%. So SPY down 4.5% off of the high. Look, we got Ryan to do that little charty chart thing. Yeah, so I mean, 5% off of the SPY is like, that's like a big deal.

• 12:13Ryan Sean Adams?

  Oh, wow, 5% down? Oh, no. Come on, guys.

• 12:20David Hoffman?

  The global economy is 5% off?

• 12:22Ryan Sean Adams?

  You want to be a... Real investors just like crypto volatility, all right?

• 12:26David Hoffman?

  Anyways, SPY goes down 5%, crypto is gonna catch a cold.

• 12:30Ryan Sean Adams?

  Yeah.

• 12:31David Hoffman?

  And so that's what's happened.

• 12:32Ryan Sean Adams?

  You know what's interesting about this is, okay, so gold has been up relentlessly up on like the last month. And like the news of the weekend did not stop gold's ascent. So is crypto, is Bitcoin trading like a risk-off asset? I thought it was like a digital gold. And it's been interesting that it hasn't been trading like that. So you would think, at least some narratives would say that global turmoil equals, of course, like wars and like rumors of wars. Governments are gonna print money, aren't they? In order to pay for this stuff and show, shouldn't a non-state store of value pump? You know, gold has, why not Bitcoin? You have any takes?

• 13:12David Hoffman?

  Yeah, I don't know why gold is pumping, obviously. I'm not like a macro expert. It is a little bit sus that like people were talking about gold pumping and then right into the Iran conflict. But what the hell do I know? Overall, just like the whole hopium for the setup right now is just like basically the inverse of all of these things. Like the tax sell-off isn't real or it's behind us now. Iran versus Israel actually stabilizes. Eventually, the inflows into the Bitcoin ETFs will surpass the outflows out of grayscale. That is also just an inevitability. And, you know, the SPY can't go down forever. It's also designed to go up only. And we are currently oversold in the world of the RSI indicator. If you are a believer of such a thing, what does that mean?

• 13:55David Hoffman?

  That just means like you can't have that many selling days in a row before there's a buying day.

• 13:58Ryan Sean Adams?

  Yeah, there'll be some recovery, right?

• 13:59David Hoffman?

  There'll be some recovery.

• 14:00Ryan Sean Adams?

  At least in the short run.

• 14:01David Hoffman?

  If 2% increase in the SPY is like, you know, a 20% increase in Bitcoin.

• 14:05Ryan Sean Adams?

  Oh, you know what? We didn't have, there's the number five explanation, actually, we didn't cover, which is like the Fed is definitely talking about delaying the reduction of interest rates, right? Inflation's burning a little hot and that's kind of bled over. So if you want another reason, there's a fifth reason for you.

• 14:20David Hoffman?

  Also, you know what? The halving, it's also bull.

• 14:24Ryan Sean Adams?

  Here's the thing, though, you gotta put this into perspective. And here's a good tweet to keep this in perspective. There have only been 38 days in all of Bitcoin history where we've ever had a closing price where we currently are, which is above 61K, like above 60K. Actually, are we above 60K at the time of recording? I mean, somewhere close to that, right?

• 14:42David Hoffman?

  Yeah, we're 62 and a half.

• 14:44Ryan Sean Adams?

  Yeah, yeah.

• 14:44David Hoffman?

  We never got down below 60K.

• 14:46Ryan Sean Adams?

  It's only been 38 days.

• 14:48David Hoffman?

  Yeah.

• 14:48Ryan Sean Adams?

  Right? Like, so, I mean, we're in the kind of the same range of all-time highs that we've been in for the last, you know, like, month and a half. There's some perspective for you.

• 14:57David Hoffman?

  We haven't really experienced price discovery in crypto yet. So Bitcoin broke through the $69,000 all-time highs to get to like up to 73, 74. That's not price discovery. No one has experienced price discovery.

• 15:10Ryan Sean Adams?

  You're getting your wish, a nice slow move.

• 15:12David Hoffman?

  Right, that's exactly what I was going with.

• 15:14Ryan Sean Adams?

  You're getting your wish.

• 15:14David Hoffman?

  Yeah, like, breaking out through all-time highs and then achieving like escape velocity to the moon, that should be hard.

• 15:21Ryan Sean Adams?

  Feels healthy.

• 15:22David Hoffman?

  It feels healthy. Let's draw this place out. Let's, like, the normies aren't here yet. Like, it's still just us. Like, enjoy this time.

• 15:29Ryan Sean Adams?

  All right, well, so, how about ETH price? Are we doing something similar?

• 15:33David Hoffman?

  Uh, yeah, down 13%. Start of the week, $3,500, ending the week where we are now at $30,400. Got all the way down.

• 15:40Ryan Sean Adams?

  That was a harsh spike.

• 15:41David Hoffman?

  I'm not, I'm, no way was that real. What?

• 15:44Ryan Sean Adams?

  Yeah, it's real.

• 15:44David Hoffman?

  Oh my god, wow.

• 15:45Ryan Sean Adams?

  It's real. Didn't you look at the charts over the weekend?

• 15:47David Hoffman?

  I didn't, I'm not, during that blip where Ryan is highlighting a week down to $2,530. Yikes, wow. No wonder so many people got liquidated last week. No, what is this, four-hour candle? No four-hour candle lasted, went below $2,900. So, yeah.

• 16:07Ryan Sean Adams?

  That's pretty low, $2,500. Great buying opportunity if you snipe some.

• 16:10David Hoffman?

  Congrats anyone who sniped that. This is why it's always nice to have powder available with like, we call these stink bids, just like-

• 16:18Ryan Sean Adams?

  Stink bids?

• 16:19David Hoffman?

  You never heard of-

• 16:20Ryan Sean Adams?

  We call them stink bids?

• 16:21David Hoffman?

  I, well, yeah, traders call these stink bids.

• 16:24Ryan Sean Adams?

  I'm not, I'm not of your kind, David. I barely know how to turn.

• 16:27David Hoffman?

  It's when you set a limit order so unreasonably low that you just hope that you like kind of win a lottery with like some volatility.

• 16:34Ryan Sean Adams?

  Ah, so you have those-

• 16:35David Hoffman?

  It's basically kind of like a put. It's a spot, it's a spot market put.

• 16:39Ryan Sean Adams?

  Yeah. All right, so what's your stink bid at right now for this market?

• 16:43David Hoffman?

  I don't have any.

• 16:44Ryan Sean Adams?

  I saw my triple-digit stink bids.

• 16:47David Hoffman?

  Yeah, you are. Those are not getting filled. Those are not getting filled.

• 16:50Ryan Sean Adams?

  Yeah, I think I've capitulated on that. Let's talk about ETH gas price, though. Real high, actually.

• 16:56David Hoffman?

  Yeah.

• 16:57Ryan Sean Adams?

  Almost 500 Gwei at certain points. That is real expensive.

• 17:00David Hoffman?

  We experienced a one-hour period of negative 10% deflation of ETH supply because of all liquidation.

• 17:07Ryan Sean Adams?

  So that's a nice ETH holder framing on it, but like for the users, it's really expensive. What's nice about this, David Mihal is showing there's a bifurcation in terms of gas market. What's he saying here?

• 17:18David Hoffman?

  Yeah, so the Ethereum Layer 1 experienced 500 Gwei gas prices. Ethereum blob price, so like blob space for Layer 2s, completely unaffected by the congestion fees on the Layer 1. So Layer 2s were completely buffered from all of the liquidations and shenanigans and congestion happening at the Layer 1. So if you were on Base or Optimism or Arbitrum or ZK Sync or Polygon, you had absolutely no awareness or concern about the congestions of the Layer 1.

• 17:46Ryan Sean Adams?

  It's like getting stuck in a traffic jam and then you look over and there's that high occupancy vehicle lane and cars just like whizzing by.

• 17:52David Hoffman?

  Zooming, just zooming.

• 17:53Ryan Sean Adams?

  Full speed ahead.

• 17:54David Hoffman?

  Don't care about you.

• 17:55Ryan Sean Adams?

  That's what was going on. And it's great because now for the first time post blob space, there are two separate markets for this, as it should be. So the question is, what are the prices on ETH Layer 2s? Is that still hanging down? What are we looking at?

• 18:08David Hoffman?

  Yeah, so this is a brand-new website, part of the website of growthepie.xyz, which if you are interested in just looking at the fee dynamics, the economics of Layer 2s, this is definitely the website for you. So fees.growthepie.xyz is this new website. It just shows you the fees for all the different chains. 0.15 cents, not 15 cents, 0.15 cents to transfer ETH on Zora. 0.41 cents to swap fees on Zora.

• 18:34Ryan Sean Adams?

  Under a cent. Real cheap.

• 18:35David Hoffman?

  Yes, everything is under a cent here.

• 18:37Ryan Sean Adams?

  Fractions of a penny.

• 18:38David Hoffman?

  Yeah, the only systems that are above a penny are systems that are not yet using blob space. So Linnea, Linnea not yet using blob space.

• 18:47Ryan Sean Adams?

  They are actually, actually.

• 18:49David Hoffman?

  Linnea?

• 18:50Ryan Sean Adams?

  Yeah, I could sort this, but okay, look at this. They are, but like, see, look at this. You can sort by data availability blobs. I don't know, Linnea is just, it's premium, premium stuff. It's good stuff over there.

• 19:00David Hoffman?

  All right, good stuff over there.

• 19:02Ryan Sean Adams?

  Must be.

• 19:02David Hoffman?

  What's the cheapest thing to, Arbitrum is the cheapest chain to swap tokens on for 0.65 cents.

• 19:10Ryan Sean Adams?

  What a deal, what a deal. Do some trades over in Arbitrum these days. Crypto market cap, where are we hanging in?

• 19:15David Hoffman?

  2.4 trillion dollars.

• 19:17Ryan Sean Adams?

  2.4. Let's do another quick look at Layer 2s and Layer 2 worlds. David, you've got some stats for us. This update, of course, is brought to you by one of our favorite Layer 2s, which is Mantle. They're always placed quite high on the charts, hanging in at number 5. What do you want to look at this week?

• 19:34David Hoffman?

  Yeah, so drop down below 30, 40 billion dollars in TVL on Layer 2s. We're at an 11x scaling factor, so 11 Ethereum's on Layer 2s. So these numbers haven't really changed, but I think what is cool actually is, we talked about Layer 2 beat for all the Layer 2s, but now we're moving on to Layer 3s, right? I don't know if you've noticed this. Base, which is an Arbitrum Orbit chain that settles down to the base chain.

• 19:59Ryan Sean Adams?

  Okay.

• 19:59David Hoffman?

  Which settles down to Ethereum. Arbitrum, the DGEN Layer 3 is now doing the most transactions per second out of all of, all the Layer 2s.

• 20:08Ryan Sean Adams?

  Okay, so a Layer 3, is a Layer 3 just a layer, a chain built on top of a Layer 2? Is it really that simple?

• 20:16David Hoffman?

  It's really that simple.

• 20:17Ryan Sean Adams?

  Okay, so there is a chain called DGEN Chain, which is killing it in terms of transactions per second. And that is just built on top of the base chain, which is built on top of Ethereum.

• 20:27David Hoffman?

  Yep. So DGEN Chain is the number one chain that's on a Layer 2, that's doing the most transactions per second. And the number 2... Transactions per second chain is base, which is where DGEN chain settles to. Okay, I just have one question for you, David. Sure. When layer four? Okay.

• 20:46Ryan Sean Adams?

  We could just like, keep stacking them.

• 20:48David Hoffman?

  I don't think any, I think it stops at the layer three level on, for a technical, for like, all, it kind of just stops at layer threes. If you are doing a layer fours because you're doing it for the meme, you can do that. There's nothing stopping you. I want to do that. But you just want to do that? Build on top of DGEN. Yeah, you should, you should ask Andrew from Quandoo. He'll really need some help on that one.

• 21:08Ryan Sean Adams?

  Settle on top of DGEN.

• 21:09David Hoffman?

  David, what do we have coming up? WorldCoin is going from its app to a chain. We're getting Worldcoin. If you didn't have enough layer twos, well, you just got another one. But this one's different. So if you are a verified human, you will be given a first-class treatment on Worldcoin. We're going to talk about that. OKX, also doing another chain. They're doing another, we're still talking about layer twos. Which framework did they choose? And then also Kraken, congrats guys, launched their wallet. Privacy first, open source, and absolutely beautiful. I'm going to show you all, Ryan, I'm going to show you all my NFTs that are on my Kraken wallet. Okay. And I got them in there. So we're going to get to all of that and more. But first, we're going to hear directly from Kraken, our preferred exchange, and now wallet. If you do not have an account with Kraken, or if you haven't downloaded their wallet, Go get the wallet.

• 21:52David Hoffman?

  Go get the wallet. Yeah, go do that. And then make your an account with Kraken. Let's go hear from them right now. If you want a crypto trading experience backed by world-class security and award-winning support teams, then head over to Kraken, one of the longest-standing and most-secure crypto platforms in the world. Kraken is on a journey to build a more accessible, inclusive, and fair financial system, making it simple and secure for everyone, everywhere, to trade crypto. Kraken's intuitive trading tools are designed to grow with you, empowering you to make your first or your 100th trade in just a few clicks. And there's an award-winning client support team available 24/7 to help you along the way, along with a whole range of educational guides, articles, and videos. With products and features like Kraken Pro and Kraken NFT Marketplace, and a seamless app to bring it all together, it's really the perfect place to get your complete crypto experience.

• 22:37David Hoffman?

  So check out the simple, secure, and powerful way for everyone to trade crypto, whether you're a complete beginner or a seasoned pro. Go to kraken.com/banklist. To see what crypto can be, not investment advice, crypto trading involves risk of loss. Have you heard about Safe? They're not just pioneers in crypto custody. They're also leading the transition to the world of smart accounts. With Safe, managing your crypto has never been smarter or safer. They've recently passed $100 billion in total value secured and are now deployed everywhere with over 15 supported networks. But that's not all. Safe is revolutionizing the game with their full compatibility with ERC 4337, making embedding wallets super easy to integrate into your daily crypto activities. So what are you waiting for? Head over to safe.Global to join over 8 million others in securing your crypto.

• 23:21David Hoffman?

  And while you're there, don't forget to check out SafeCon, happening during the Berlin Blockchain Week, where the future of smart accounts is unfolding in real life. Secure your spot today and be a part of the transition to smart accounts. Click the link in the show notes to learn more and take your first steps towards smarter crypto management. Taking self custody of your crypto is one of the most important things you can do on your Bankless journey. It's also one of the hardest things to get right with huge consequences if you don't. If you want help going bankless, talk to Casa. Casa helps you take custody of your crypto assets, so you don't have to wonder whether you're doing it right. Casa is a one-stop shop for doing self custody the right way. With Casa Vaults, you can hold Ether, Bitcoins, stablecoins, all with one simple app and multiple keys for the ultimate peace of mind with a support team to help you every step of the way. But it doesn't stop at self custody,

• 24:06David Hoffman?

  because even though crypto is forever, you are not. We all plan on making life-changing wealth in crypto, but with Casa's inheritance product, life-changing wealth can elevate to generational wealth. For your kids and your loved ones who don't know anything about crypto. With Casa, you won't lose your private keys and you won't accidentally take them to the grave either. Click the link in the description to get started securing your generational wealth.

• 24:27Ryan Sean Adams?

  Not to overshadow the happening, David, but it is Chain Week. It is Layer 2 Week on Bankless as well, okay? We got two big Layer 2 announcements. One of them just went live on Mainnet, so let's start there. WorldCoin introduced Worldcoin. All right, the last I heard about WorldCoin, they were trying to stick orbs in everyone's faces and scan your eyeballs. Oh, they're still doing that? Still doing that, yeah. So I had seen, I think, a headline that they got to about 5 million humans with iris scans. So that's the level. Anyway, that aside, what are they doing? What is Worldcoin?

• 25:03David Hoffman?

  So World Chain has always been a part of the World Coin vision. So anyone who's been like deep in the World Coin world, this actually is not a surprise. It is an OP stack fork. It is a part of the Superchain Collective. But it has a very intimate technical relationship with its own World ID and World Coin app. And so if you verify yourself, your iris, I mean, within the World Coin system, you are a verified human on the World Chain. And you actually get subsidized transactions on World Chain, as in free. Not infinitely free, but I'm sure this model is going to change. But the idea is really to bifurcate humans from bots on World Chain. And so if you are a human, because you are proven to be human because of your iris,

• 25:47David Hoffman?

  you're like, you get a private key that's associated with your iris. You get to have first-class position on World Chain.

• 25:56Ryan Sean Adams?

  A couple of things, you know, World Coin as an app so far is about 44% of OP mainnet's activity. At this point, I didn't realize.

• 26:04David Hoffman?

  I think it's a part of the World Coin system. Because like verifying a human and putting their iris, the hash data of your iris on chain. I think that's how that works.

• 26:13Ryan Sean Adams?

  So, and they're launching this, did you say this, as an OP stack chain?

• 26:18David Hoffman?

  It's an OP stack chain inside of the collective.

• 26:20Ryan Sean Adams?

  Okay, so they're joining the Superchain. So eventually all of these will be integrated. You know, feelings aside, people have lots of passionate feelings about your World Chain and using biometric data to identify humans and all of that. Don't want to step, we've had that conversation before. Just not stepping into that conversation. The idea of having a chain that is human-aware, right? Any sort of block space that is human-aware is new. And I think that's actually, it's interesting, right? Because, well, we have all sorts of simple resistant problems, not just in crypto, but, or sorry, not just on the internet, but like even specifically crypto, like in the here and now. It's like, I want to provide an airdrop to all of my real human users.

• 27:04Ryan Sean Adams?

  How do I do that? I have no idea. You could be like a Bot Farm account with like hundreds of different accounts. And by the way, I'm not saying that World Coin isn't gamable because I've also seen some like ways where it can be gamed. But it is at least better. It is more Sybil resistant than just like being able to spin up any sort of wallet and like, you know, track it that way. So human aware block space, human aware chain, where we can tell who the real people are and who the bots are. Do you think that's significant?

• 27:35David Hoffman?

  Yeah, and I think that we won't really know how or why it's significant. We won't have examples for this until like they meaningfully get built. But really like the whole idea is that we have this platform to do activities and behaviors that we haven't had before. And that really starts with having some decent levels of assurances that Deb's building on this block space. Gets to know that they are actually having individually humans as their users rather than getting bot farmed. And so like the the blast layer two pitch is like, yo, we have native yield. So come build on our platform, come put your money on our platform. And the world chain pitch is like, yo, we have real individual, non Sybil humans. So therefore come build on our platform.

• 28:19Ryan Sean Adams?

  Zooming out for a second, you and I have talked about this like recently, and I think we want to do an entire episode on this, like the the dead internet theory. What is the dead internet theory?

• 28:30David Hoffman?

  The dead internet theory is this theory that I came across from this various AI conversations. It's this online conspiracy theory. I'm like four for four on conspiracy theories in the podcast in the last week, by the way.

• 28:41Ryan Sean Adams?

  This is a bigger one, though.

• 28:42David Hoffman?

  It asserts that now the internet is actually mostly bots. And the activity of the internet is mostly bots. And the content generated on the internet on Facebook is actually mostly bots. And so like the internet is actually a human devoid place. And now we're getting to the point where like it's bots consuming content by bots, producing content for bots. And actually like a lot of the commerce of like startups and internet companies are actually just like, it's actually bots facilitating bots and we actually don't know it. And so the internet is actually more dead than we actually assume.

• 29:19Ryan Sean Adams?

  It's like a bunch of bots pretending to be humans too, right?

• 29:22David Hoffman?

  Exactly.

• 29:23Ryan Sean Adams?

  Okay, so but so you said you pitched that as a conspiracy theory. I think the framing of it of like saying that internet theory like. You know, if you were to say there are no humans on the internet anymore, that would be like very far and kind of a conspiracy. But what you just said, I don't consider that a conspiracy. That's evident. I mean, go try to interact on Twitter.

• 29:43David Hoffman?

  At the very least, it's the trend.

• 29:45Ryan Sean Adams?

  Right. And like with all of the AI content and like deep fake type ability you have, like it's going to continue to do that. I mean, you're not going to know whose Instagram account is real, apart from some sort of proof of personhood type of protocol, right? I guess that's the entire point of World Chain or World Coin and maybe World Chain. But yeah, I don't know how much of a conspiracy theory it is. Like, that's just like what's self-evidently going on.

• 30:10David Hoffman?

  You could be listening to a podcast and one of them might be a bot. You just don't know.

• 30:14Ryan Sean Adams?

  One of the hosts of the podcast, your favorite podcast that you listen to. You don't even know if that person's a real human or not. That's not the only layer two that we need to talk about this week. OKX, which is a crypto exchange, one of the world's largest, you know, top three, top five, something like this, just launched X-layer. This is a layer two on Ethereum. It is, I believe, a ZK EVM. I think it's built on the Polygon stack. What else do we need to know?

• 30:44David Hoffman?

  It's also one of the first chains to use the Polygon Ag Layer. So if you've been paying attention to like chain development in this space, Polygon has really been promoting their like Ag Layer solution for global liquidity interoperability, not just for Polygon chains, but just actually kind of anyone. And so this chain, the OKX X-layer, which we're going to get this confused with Twitter X, but whatever. So they're using Ag Layer. And so all of the chains that tap into the Polygon Ag Layer can actually share liquidity with each other, like perfectly interoperable liquidity. So more chains that leverage the Ag Layer all can add to a central liquidity pool. And there's also going to be the OKB token as the native token on X-layer. Interesting that they're calling it X-Chain or X-Layer instead of X-Chain.

• 31:28David Hoffman?

  I like that. I like that change of pace. And so you can ask, they will also be able to use this to pay the transaction fees thanks to the AgLayer.

• 31:35Ryan Sean Adams?

  Yeah, I think this is a big deal because this is another major exchange that has entered the space, throwing their hat in the ring. And like there's, you know, the meme of, is this the base for Polygon? So it's another large exchange. It's outside the US, of course, primarily. And it is on a different Layer 2 stack, which is Polygon instead of Optimism. And gets the benefit from AgLayer from the start, which is, again, composability across the entire Polygon ecosystem of chains. So if we do a rundown, David, of exchanges with an Ethereum Layer 2 at this point, we've got Coinbase. All right, we know about BaseChain. Bybit is associated with Mantle. They've kind of like funded that and brought that to market.

• 32:17David Hoffman?

  Bybit turned themselves into a DAO and then that DAO produced their own chain, which is Mantle.

• 32:22Ryan Sean Adams?

  Yeah, now we have OKX doing one. There are two other exchanges kind of on my list, which is like Kraken and Binance. And by the way, there's been rumor that Kraken is sort of like investigating a Layer 2, right?

• 32:34David Hoffman?

  They won't tell us though.

• 32:34Ryan Sean Adams?

  And then Binance, they have a sidechain effectively that I think there's a roadmap for it to become a Layer 2, if that ever made sense. So I think it's only a matter of time before all of the major exchanges have their own Layer 2s. And this is something that we predicted for a long time, actually, on Bankless. Not to just pat ourselves on the back, we sometimes do that a little bit.

• 32:55David Hoffman?

  Yeah, we do that.

• 32:56Ryan Sean Adams?

  Okay, so, but like, first it's the exchanges, then I think it's going to be the banks. Because what's the next proximate thing to an exchange? It's probably a fintech company like a PayPal, for instance, or like a Revolut, or like a TransferWise or something like this. And then eventually we'll get to the stage where, what are banks anyway? They're all sidechains. They're all ledgers.

• 33:17David Hoffman?

  They're all ledgers.

• 33:18Ryan Sean Adams?

  So if they settle on top of a global settlement system, if they settle on top of Ethereum, they become a Layer 2. Maybe a Layer 3 or maybe a Layer 4, I don't know. But some sort of chain on top that's settling. So we're just knocking them, knocking them down from my perspective. And I'm super excited that exchanges are now going like towards crypto nativity and becoming a bit more a blockchain native.

• 33:43David Hoffman?

  One thing I think might be cool to see is that banks are always just going to have a hard time getting comfortable with this. So I could, I could totally see something like Trad Bank, some like, you know, TradFi, Wells Fargo-esque bank, making a layer two on Ethereum, but actually it's private and only for them, as in like, they're the only ones with right access. And, but then they give like select parties read access, maybe, maybe it's an encrypted layer two, I don't know, that technology's not here yet, but it will be. But like some sort of just like, they just leverage a blockchain for their internal accounting and as like an insurance mechanism and efficiency mechanism for themselves. And then they can like, they elect to go up and down between Ethereum, the layer one, and their private layer two that they control.

• 34:26David Hoffman?

  I think that, I don't know if that future is a thing, but I could totally see it.

• 34:30Ryan Sean Adams?

  JP Morgan has a chain, formerly called Quorum, or they're, it's just basically a private blockchain, it's just not public. They're making the transition to make aspects of that, that public in settled to Ethereum could be a thing. So, uh, really cool.

• 34:45David Hoffman?

  Yeah. Speaking of Kraken, who does not have a chain yet, but maybe they will one day, they do have a wallet, though. And if you're gonna build a wallet, you're getting pretty close to building a chain, I'm just saying. Here's, here's my Kraken wallet. I loaded up my crypto cabin, it's an old NFT that I have, I think it's pretty pretty. Have you opened up your wallet? Yeah? Have you opened up your Kraken wallet?

• 35:05Ryan Sean Adams?

  There, there it is. That looks beautiful.

• 35:06David Hoffman?

  It does look beautiful.

• 35:07Ryan Sean Adams?

  Yeah, so I downloaded, I started with a fresh set of keys. You already got stuff on there, so how did you do it?

• 35:13David Hoffman?

  Well, I have a seed phrase of like my petty cash that I keep on my phone. And so all the wallets that I use, I just load up the same seed phrase. Yeah, nice, nice trick, actually.

• 35:22Ryan Sean Adams?

  So what do you, what do you think so far?

• 35:24David Hoffman?

  It's nice and purple. It's the Kraken. It's absolutely beautiful. Uh, let's see, so you have different chains, you have all the assets, right? Uh, it was really nice to see my NFTs in there that I wanted to see, and all the spam ones were not in there by default, so I didn't have to do anything with that. Uh, and then different chains. I don't think there's bridging yet. Um, so you can't bridge between layer twos, but you can send and receive on layer twos. Uh, there's also like Solana report, uh, um, support for people who like to play on Solana. Uh, but then there's also Wallet Connect, so like you can basically do anything inside of Ethereum, DeFi via Wallet Connect.

• 35:55Ryan Sean Adams?

  They're doing the cross-chain thing kind of nicely where it's just like all abstracted. So you don't have to know what chain you're on. You don't have to go switch around like you do in some older wallets. So I really like that. From a behind the scenes perspective, David, here's something I thought was cool. So the Kraken wallet is open source, like completely open source. So it is, and they're the first exchange, I think, to ever do this. So it's available on GitHub. So you could see how it's built. They've also built IP privacy as part of this, right? So it's a lot of analytics that can be derived about, and they seem to be tailoring this to make crypto native people, folks feel secure that their IP address hasn't been being collected and that kind of thing. So

• 36:35David Hoffman?

  Pretty on brand for Kraken, I'd say.

• 36:37Ryan Sean Adams?

  Yeah, I think it's great. And I think Bankless listeners, again, like I have, I'm in a place where I used to be like a single wallet type of person. Now I have like multiple wallets. And this is going to have a place on my phone. It's not like a perfect right out of the gate, but I expect Kraken's going to be improving it. And yeah, a great, great, great start on this product.

• 36:57David Hoffman?

  It's a foot in the door for Kraken to do something, like be more on-chain. Again, like have their own chain. I expect this is like the first of like a direction for Kraken. Like, no one ends at a wallet.

• 37:10Ryan Sean Adams?

  Yeah, I totally agree. There's a link in the show notes if you guys want to check it out as well. David, let's talk about Hong Kong approving the SPOT Bitcoin and Ether ETF. So that was announced this week. So trading is not yet begun, but that is announced. So the question is, is this a big deal? Is this going to bring like all of Asia's like inflows into crypto? Who has a good take here?

• 37:34David Hoffman?

  I think this is, people are celebrating this just because we're actually kind of distraught and for it about our own lack of ETH ETFs inside of the United States.

• 37:42Ryan Sean Adams?

  Yeah.

• 37:43David Hoffman?

  Yeah. And we have the Bitcoin ETFs, right? And so, but they are also getting the ETH ETF. Is this going to move markets? Eric Balchunas says probably not. The Hong Kong market is pretty tiny. Like the total market is only $50 billion. Just because it's approved in Hong Kong doesn't mean Chinese capital has access to this. So there's like a firewall between the capital of China and the capital of Hong Kong. And also the three issuers, according to Eric Balchunas, are kind of tiny. There's no like big fish here. There's something like BlackRock, and then the fees on these things are about to be like 1% to 2%. So whereas it's like 0.2% to 0.3% for Bitcoin ETFs in the United States, Eric says it's likely going to be 1% to 2% inside of Hong Kong. So it's more about just like, hey, somebody else got an ETF.

• 38:27Ryan Sean Adams?

  Yeah, there is some symbolism, right? This is like a Chinese adjacent, China adjacent jurisdiction for certain. And for a jurisdiction kind of like famous for its capital controls, right? For them to get an Ethereum ETF besides the United States? There's probably some symbolism in that, wouldn't you say? Like, if I was making the argument in front of Congress, if I was like a Congress representative who wanted to make the case, I'd just be like, Gary, Gary Gensler, okay? Hong Kong has an Ethereum ETF. Where are you? The whole world has an Ethereum ETF right now. Canada, Europe, like you can buy these ETP products. US, is the US really going to be a laggard for this product? Maybe there's some ammo there that we can lean for this.

• 39:12David Hoffman?

  Yeah, so it's a symbolic victory.

• 39:14Ryan Sean Adams?

  All right.

• 39:14David Hoffman?

  It's a symbolic victory.

• 39:14Ryan Sean Adams?

  We'll take it. We'll take any kind of ETF victory we can at this point, David. What do we got coming up?

• 39:19David Hoffman?

  Coming up next, Ethereum Layer 1 is actually getting a pretty big wallet upgrade. EIP 3074, we're going to tell you everything you need to know about that particular EIP. Solana has also got its patch, so it's easier to get a transaction through now. And 0X Maki, remember that name, Ryan? 0X Maki? He awakens from retirement. What's he up to and why is everyone murmuring about it? So we're going to get to all of this and more. But first, a moment to talk about some of these fantastic sponsors that make this show possible, especially Mantle, who makes their own chain possible. And so you can collect all the yield on it as well. Let's go hear from them right now. Mantle, formerly known as BitDow, is the first DAO-led Web3 ecosystem, all built on top of Mantle's first core product, the Mantle Network, a brand-new, high-performance Ethereum Layer 2 built using the OP stack,

• 40:03David Hoffman?

  but uses Eigenlayer's data availability solution instead of the expensive Ethereum Layer 1. Not only does this reduce Mantle Network's gas fees by 80%, but it also reduces gas fee volatility, providing a more stable foundation for Mantle's applications. The Mantle Treasury is one of the biggest DAO-owned treasuries, which is seeding an ecosystem of projects from all around the world. Web3 space for Mantle. Mantle already has sub-communities from around Web3 on-boarded, like Game7 for Web3 gaming and Bybit for TBL and Liquidity and Onrants. So if you want to build on the Mantle network, Mantle is offering a grants program that provides milestone-based funding to promising projects that help expand, secure, and decentralize Mantle. If you want to get started working with the first DAO-led Layer 2 ecosystem,

• 40:44David Hoffman?

  check out Mantle at mantle.xyz and follow them on Twitter at @zeroxmantle. Cello is the mobile-first, EVM-compatible, carbon-negative blockchain built for the real world, driving real-world use cases like mobile payments and mobile DeFi. And with Opera MiniPay as one of the fastest-growing Web3 wallets, Cello is seeing a meteoric rise with over 300 million transactions and 1.5 million monthly active addresses. And now, Cello is looking to come home to Ethereum as a Layer 2. Optimism, Polygon, Matter Labs, and Arbitrum have all thrown their hats in the ring for the Cello Layer 2 to build upon their stacks. Why the competition? The Cello Layer 2 will bring huge advantages like a decentralized sequencer, off-chain data availability secured by Ethereum validators, and one-block finality. What does that all mean for you? With Cello Layer 2, gas fees will stay low,

• 41:29David Hoffman?

  and you can even pay for gas natively using ERC20 tokens, sending crypto to phone numbers across wallets using social connect. But Cello is a community-governed protocol. This means that Cello needs you to weigh in and make your voice heard. Join the conversation in the Cello forums. Follow Cello on Twitter and visit cello.org to shape the future of Ethereum. Launching a token? Don't let complex legal and tax issues slow you down. Toku provides specialized support to optimize your launch and ensure that you as a founder, and your team, and your investors, get the most tax-efficient outcomes. The Toku team understands the crypto space inside and out and will ensure your token launch is fully compliant while maximizing tax efficiency. Toku can connect you with the best attorneys if you need them to make sure that you have the best advice, and Toku can help to optimize your taxes

• 42:12David Hoffman?

  so you pay the least possible amount of taxes while still maintaining legal compliance. With Toku's guidance, you can concentrate on building your company while Toku handles the logistics. Token launches don't have to be complicated. Talk to Toku today to get a free initial token valuation. Ethereum Super Wallets.

• 42:27Ryan Sean Adams?

  That's what I'm calling them. I don't know if that'll catch on at all, but this is a pretty cool upgrade. It is protocol level. It is coming in the next Ethereum hard fork. It has, of course, an EIP. I'm going to have you recite, because I don't yet have this one.

• 42:41David Hoffman?

  3074.

• 42:42Ryan Sean Adams?

  3074. I don't have this memorized, but it is a pretty significant upgrade. Can you tell us about it?

• 42:48David Hoffman?

  This is account abstraction, which bankless listeners have heard countless times, which has generally been in the domain of layer twos. We all need account abstraction. Everyone needs account abstraction. Gosh, what is account abstraction? Basically, it puts logic into your wallet. So it turns your wallet, which is usually just a dummy wallet. It is what's formally called as an externally owned account, an EOA. It's basically just a public key and a private key with no logic in it whatsoever. Smart accounts, smart contract wallets, account abstraction are trying to produce smart contract wallets. So your wallet is like a brain. It's got like chip, it's got logic in it, it's got expressivity. In the same way that Bitcoin is Bitcoin, Ethereum is Ethereum. Externally owned accounts are like Bitcoin, smart contract wallets are like Ethereum.

• 43:33David Hoffman?

  And so how to design one and what features we should formally enshrine into the layer one has been a topic of debate amongst Ethereum developers for like...

• 43:42Ryan Sean Adams?

  Long time, forever.

• 43:42David Hoffman?

  As long as I've been in crypto, as long as I've been here in Ethereum. EIP 3074 has been a thing for a very long time. It was picked up, it was debated years ago, it was dropped, it was ignored, it got picked up again recently. Now it's getting pushed through. And so it's actually kind of like a monumental hurdle that's overcome, because this is actually kind of like the start of increasing the scope of the sophistication of smart contract wallets that are enabled in the layer one. We are starting small as we do in Ethereum, and then we are expanding the scope as we come to consensus about what features should be enshrined on the layer one. This is like doing the thing that Ethereum is very cautious about doing, which is putting opinions and adding complexity into the layer one, but we're doing it. And so if you've ever traded a token on Uniswap that you haven't traded before,

• 44:26David Hoffman?

  you have to go and first approve that token.

• 44:29Ryan Sean Adams?

  Multiple steps, multiple buttons to press.

• 44:31David Hoffman?

  Yep. Now, this is all being bundled up into one single, like, smart service. So no more token approvals at the Layer 1. Also, this unlocks sponsor accounts. And so you can actually have no gas in your wallet, but through smart contract wallets, you can actually have a third party pay for your gas for you. And so you actually don't need any gas. You just have assets and somebody else pays for your gas. And there's a bunch of other features as well. But basically, like I said, it's just the big first foot in the door to unlock the entire, like, landscape of smart contract wallets for Ethereum Layer 1.

• 45:03Ryan Sean Adams?

  Yeah, wallet asset recovery is another thing about this. We could have, like, social recovery wallets. I think that's great. Here's the thing I'm most excited about this. All right? So a bunch of people, crypto natives, listening to Bankless right now, like, they might have dozens of wallets, right? So the question is, what happens to those wallets? Do I have to create brand-new wallets? Here's the best part, okay? You can migrate your existing EOA wallet, same ETH address, to account abstraction wallet and get all of those benefits. That, I didn't realize before I learned a bit more about this, that it would be, like, so backward-compatible, I guess? Or like, I thought, I just assumed that we'd have to, like, create all new wallets and this would be possible in the future.

• 45:46Ryan Sean Adams?

  My legacy wallets are, like, all FUBAR, but they're not. You can actually, like, all the wallets that you've spent so much time and have so much history in, they can, they can turn into account abstraction wallets, which I think is a pretty big deal. Give us a sense for when this is coming, David. So next Ethereum hard fork, okay? So that's, it's been approved for that, but when is the next Ethereum hard fork?

• 46:06David Hoffman?

  Well, no one really knows when. No one asks when is the next Ethereum hard fork.

• 46:10Ryan Sean Adams?

  Yes, we do. We always do. We always ask.

• 46:13David Hoffman?

  Sometime at the end of this year, probably, which means probably at the start of next year, which means probably Q2 of next year. These things tend to get delayed. So think, think, like, early 2025.

• 46:26Ryan Sean Adams?

  Early 2025. That's some nice padding, David. I'm optimistic for Q1 2025 that we'll have this, but we'll see.

• 46:35David Hoffman?

  Again, the next upgrade, next hard fork for Ethereum is called Pectra, which is a combination of, should we even go into this? I think we should. Prague and Electra. So Electra is a star, Ryan. Prague is a city. But Prague is the execution layer of Ethereum and Electra is the consensus layer of Ethereum.

• 46:53Ryan Sean Adams?

  Wait, Electra is a star?

• 46:55David Hoffman?

  Yeah, so this is how Ethereum hard forks are named. So you take a city that's on planet Earth and that is the execution layer hard fork. And then you take a star, a name of a star somewhere in the sky. And then you portmanteau them together and that's how we name Ethereum hard forks. Did you know that?

• 47:10Ryan Sean Adams?

  Oh, wow. No, I didn't know that. And how many stars?

• 47:13David Hoffman?

  This is what happens when you let dev nerds name your hard fork.

• 47:16Ryan Sean Adams?

  I want Beetlejuice, Beteljuice. You know that star? Big red dwarf?

• 47:21David Hoffman?

  Well, so we already passed B, so E is, it was A, B, C, D. So like after Electra, it will be an F named star.

• 47:28Ryan Sean Adams?

  An F star?

• 47:29David Hoffman?

  With some, with F star.

• 47:30Ryan Sean Adams?

  I don't know any F stars.

• 47:31David Hoffman?

  I don't know any F stars either.

• 47:33Ryan Sean Adams?

  All right. Well, I can't wait. I can't wait.

• 47:35David Hoffman?

  But I bet you the EF devs do, because they would.

• 47:38Ryan Sean Adams?

  Nerds.

• 47:39David Hoffman?

  Nerds.

• 47:39Ryan Sean Adams?

  We love you guys. That's great. I'm really excited to talk about, what is it? You said Pectra?

• 47:44David Hoffman?

  Pectra, yeah.

• 47:46Ryan Sean Adams?

  Get the people excited about Pectra. It's coming. All right. Tell us about Eigenlayer because it is, it did a mainnet last week. Yeah. Now it's unpausing restaking deposits. What does this mean? Does this mean Floodgate is open to all the capital, all of the ETH?

• 48:01David Hoffman?

  That's right.

• 48:01Ryan Sean Adams?

  That you can pour into Eigenlayer? Now you can just like, you know, there's no limit. There's no cap.

• 48:06David Hoffman?

  There's no limit. Yeah. So there was 12 and a half, 13 billion dollars of ETH and related LSTs inside of Eigenlayer at the time of the cap.

• 48:14Ryan Sean Adams?

  Four million in ETH supply, something like that?

• 48:16David Hoffman?

  Yeah, something like that. Someone do the math for me. They are now completely just removing the cap on LSTs. And so there was never any cap on native restaking, so you could always put vanilla Ether in and natively restake and you would generally do this via LRTs like EtherFi or Renzo or whatever. But now there's actually just no formal caps whatsoever.

• 48:36Ryan Sean Adams?

  We've slowed down a little bit. Like, how high do you think, I mean, this is like at?

• 48:40David Hoffman?

  I mean, how much ETH can Eigenlayer take up? A lot of ETH.

• 48:44Ryan Sean Adams?

  I mean, we're at like, what, like 4% ish of supply? Something like this?

• 48:48David Hoffman?

  3%, 3%.

• 48:49Ryan Sean Adams?

  I guess that's not that much. Uh, the Bitcoin ETFs already have over 3% of Bitcoin supply. I think we could go higher. I think we could get to five, six, seven, eight.

• 49:00David Hoffman?

  Eigenlayer is equivalent to the Bitcoin ETFs for Ethereum. That's large.

• 49:05Ryan Sean Adams?

  Don't you think, uh, don't you think it's that, it's that it could slurp up that much in terms of ETH? I guess it depends.

• 49:11David Hoffman?

  It already has. It already has.

• 49:12Ryan Sean Adams?

  No, no, but like, yes, it already has, but like, I'm, I'm, I'm calling for like, a higher number.

• 49:20Ryan Sean Adams?

  I'm calling for, like, I wonder if we'll see-

• 49:21David Hoffman?

  Say your number.

• 49:22Ryan Sean Adams?

  When will we see double digits? When will we see double-digit ETH supply?

• 49:26David Hoffman?

  Percentage or ETH and Eigenlayer?

• 49:27Ryan Sean Adams?

  Percent, percent.

• 49:28David Hoffman?

  Percent. Wow, 10%? Okay, so you need, uh, what is that? 12 million ETH or Eigenlayer?

• 49:34Ryan Sean Adams?

  We need to, like, triple?

• 49:37David Hoffman?

  Uh, man, that is, I don't know. I don't know.

• 49:40Ryan Sean Adams?

  It depends on the AVSs, I think.

• 49:42David Hoffman?

  It depends on the AVSs.

• 49:44Ryan Sean Adams?

  The Eigenlayer applications. If you don't speak Eigenlayer, AVS is just the, the thing built on top of Eigenlayer, Eigenapps.

• 49:49David Hoffman?

  The things that, that produce the yield. They produce the, the utility. They, they collect the fees. They give them to the LRTs. Uh, and then they are collected by capital depositors.

• 49:58Ryan Sean Adams?

  Restaking has been an absolute massive narrative this cycle, particularly for Ethereum.

• 50:04David Hoffman?

  An uncontested narrative for a very long time.

• 50:06Ryan Sean Adams?

  Let me tell you, David, something that's, that's, that's here. Whether you like it or not, it's called alt-restaking.

• 50:11David Hoffman?

  Alt-restaking.

• 50:12Ryan Sean Adams?

  That's what I'm calling it. I don't know if any of that's gonna catch on, but we've got some new, uh, restaking networks on the scene that are doing non-Ethereum stuff. One is called Nectar. Is it Nectar?

• 50:21David Hoffman?

  Nectar, Nectar.

• 50:22Ryan Sean Adams?

  Okay. And then this one, uh, Karak? Karak?

• 50:26David Hoffman?

  Uh, yeah, I know. Karak, Karak. K-A-R-A-K. Bankless, you figure out how to pronounce that.

• 50:31Ryan Sean Adams?

  Big, big raise on this one, too.

• 50:32David Hoffman?

  Big raise, yeah.

• 50:33Ryan Sean Adams?

  Karak got $1 billion from a whole bunch of VCs to accelerate, uh, universal security.

• 50:39David Hoffman?

  They got $48 million at a $1 billion valuation.

• 50:42Ryan Sean Adams?

  Man, I am a VC. I should, I should know how this works.

• 50:47Ryan Sean Adams?

  Okay, so alt-restaking, that's a thing. And the, the focus, it seems to be, at least with this narrative, is non-Ethereum tokens. So Eigenlayer, the only thing you can stake inside of Eigenlayer right now is Ether, right? And so-

• 51:00David Hoffman?

  Or Ether derivatives, yeah.

• 51:01Ryan Sean Adams?

  Or Ether derivatives. And these restaking networks are saying, hey, we could do all of the, all of the tokens. Why stop at ETH? We can do everything. There's one interesting thing, though, here, which is like, Eigenlayer is also going to do- Other things besides Ethereum, and that's been part of their their design from from day one is where they start with Ether because it's kind of the most money like, you know, highest economic bandwidth thing.

• 51:27David Hoffman?

  But also, it's mainly the unit of account of, this is Srimam's explanation, you use Ether because it's the unit of account of like the respective ecosystems because like generally the economics are denominated in Ether.

• 51:38Ryan Sean Adams?

  You have to pay your taxes in Ether, basically, so you may as well.

• 51:41David Hoffman?

  Right, yeah, so they don't, they don't want any cross volatility risks. So you denominate your assets and your liabilities in the same unit of account. You start off by Ether because that's what the Ethereum ecosystem generally denominates in, but then you can also expand to other assets because mainly you don't want to have this extra risk, which is cross asset volatility.

• 51:59Ryan Sean Adams?

  There you go.

• 52:00David Hoffman?

  And so this Eigenlayer like strategy is like, well, most things are going to be Ether-nominated first, and then we'll get to like USCC things denominated later. A pretty cool like little road rabbit hole in the Eigenlayer ecosystem is dual staking, and so you would stake Ether, but then you would also stake the native token of a respective AVS as well. And so you can have both things providing security. And this is like the Eigenlayer like slow, slow like roadmap, slow like crescendo of scope. So you start with Ether, then you add like a native token of a specific app, and then eventually you just, you can just do anything as well.

• 52:34Ryan Sean Adams?

  Yeah, well, I mean, I think it's a hallmark of Eigenlayer's success that they have alts now. You know, you know, you know, you're successful when you start getting alternatives to your solution coming aboard. So and I do think this is going to be, it's been a super successful narrative. So of course, it was going to attract competitors.

• 52:51David Hoffman?

  And this is related to mostly Karak Network. Their, their whole narrative is like we, you can stake anything. Nectar, the first one that we talked about, their whole thing is DVT, Distributed Validator Technology. This is actually a pivot from Diva. So if you all remember the Diva LST project that was always trying to like leverage DVT to kind of just be an improved version of Rocketpool, they have since pivoted into being a resaking platform that leverages DVT. So if, for bankless listeners that remember that, that name, that's where Nectar came from.

• 53:22Ryan Sean Adams?

  I'm sure we are going to be talking about restaking at the Permissionless conference, which, you know, anytime we get a chance to shout out Permissionless, I'm gonna be there, David's gonna be there, it's in October.

• 53:34David Hoffman?

  Many of these projects are gonna be there. We actually do have a panel about

• 53:37Ryan Sean Adams?

  Restaking?

• 53:38David Hoffman?

  Alt restaking.

• 53:39Ryan Sean Adams?

  Oh, really?

• 53:40David Hoffman?

  Yeah, cuz there's a restaking, well, there's Babylon on Bitcoin, there's a restaking project on Solana. And so, this is actually, these aren't the first two, like, alt restaking ones, these are just the first two to actually also focus on Ethereum.

• 53:53Ryan Sean Adams?

  Sriram's coming to that as well, he's coming to Permissionless. Bankless listener, if you want a 10% discount, you can go get that, the code BANKLESS10 at any point in time. And you like, go, come to Permissionless with us, it's gonna be a great conference. We'll be in the middle of the bull market, it'll be beautiful, it'll be good times.

• 54:09David Hoffman?

  Bankless citizens, you guys get 30%. So if you guys are listening to this on the RSS feed, or wherever you're Bankless citizen,

• 54:15Ryan Sean Adams?

  Don't settle for 10%.

• 54:16David Hoffman?

  Don't settle for 10%. The code is, the code is not BANKLESS30, so don't try that.

• 54:24Ryan Sean Adams?

  Alright, David, Immutable is doing some, are they doing, what is this? Are they doing Layer 3s?

• 54:29David Hoffman?

  More chains, we're more chains, we're talking about more chains, more chains on Ethereum.

• 54:32Ryan Sean Adams?

  It's Layer 3s, right?

• 54:33David Hoffman?

  Yeah, so, yeah, so they are building what is called the Immutable Nexus, the ecosystem of gaming chains. And so, of course, they are building out chains for the games that are part of the Immutable ecosystem. There's a lot of games coming online right now. I was actually, I don't think you're much of a gamer these days, Ryan, but there's this Dark Souls game, are you familiar with Dark Souls?

• 54:53Ryan Sean Adams?

  Yeah, yeah, yeah.

• 54:53David Hoffman?

  Yeah, there's this Dark Souls, cuz it created its whole entire genre, cuz it's such an awesome series of games. There's a crypto-esque, not even-esque, there's a Dark Souls game where all the assets are on-chain.

• 55:05Ryan Sean Adams?

  Really?

• 55:06David Hoffman?

  Yeah.

• 55:06Ryan Sean Adams?

  What's this called?

• 55:07David Hoffman?

  The Fabled, yeah, I actually demoed it at ETH Denver last year.

• 55:13Ryan Sean Adams?

  How come we're not hearing about these things? Are people, just no users, people aren't playing it?

• 55:17David Hoffman?

  Different, no, there, no, this one isn't out yet, it's on Steam with a coming soon, you can like, demo it if you wanna, I think you can like, join us through some hoops.

• 55:25Ryan Sean Adams?

  Steam is totally fine with like, crypto games? Cuz I know some platforms have not been.

• 55:29David Hoffman?

  Well, this hasn't launched, but it's got a Steam page, it's got a Steam page. This game that is very elegant. The graphics are beautiful. It was a little bit clunky when I played it, but I played it back in 2023 and so like a year, over a year ago. So I'm assuming it's been.

• 55:43Ryan Sean Adams?

  Is this going to be on, is Fable going to be on immutable?

• 55:45David Hoffman?

  I think so. The Fabled, I think so. I think it's an immutable game. I don't know. I'll ask Robbie. Anyways, it might have its own chain because that's what this whole announcement is. And so you are, as a game, get to have your own ZK EVM because the costs of chains are just like so low these days. Like spinning up a chain with conduit, you can go to conduit and just spin up an OP stack chain for $3,000 a month. It's probably a little bit more for a ZK EVM.

• 56:09Ryan Sean Adams?

  This is a ZK EVM chain that settles on top of immutable, which is a layer two, which settles on top of Ethereum, right? So we got chains on chains again. It's a layer three, David. I found another layer three.

• 56:21David Hoffman?

  It's not, it's not exactly a layer three. DGEN is a strict layer three. The ZK EVM, it's more of a fractal mesh network, so it's a little bit more horizontal. So there's not strict settling down to one specific chain. It's actually all kind of like settles together. But you do get dedicated throughput. Gaming is like one of the most reasons why you would want your own sovereign chain. So you don't want to share block space with a different game. And so you get perfect customization. You get to like, you know, reconfigure what your chain looks like. You can configure native tokens for gas and staking, so your game can have a native token. And then you get the set of ecosystem partners out of immutable. So congrats to immutable.

• 56:58Ryan Sean Adams?

  David, I know you are one to stay on the frontier of crypto, aren't you? So I wanted to hear about some of your recent frontier experiences. I think, I think you're coming up with podcasts on these because I've been tuning into the Bankless Premium feed and I caught one of the, well, I haven't listened to it yet, but it's waiting for me on the feed where you go and you talk about the crypto, the crypto, the game. Let's start there. What is crypto, the game? Cause I've been, among like my crypto friend circles, everyone's talking about this thing. And it's been described to me as like Survivor meets crypto.

• 57:32David Hoffman?

  Yeah.

• 57:32Ryan Sean Adams?

  Yeah, it's about right. Reality TV show type of thing. Like what is this thing?

• 57:36David Hoffman?

  Yeah. Think of it like an MMO, multi, massive multiplayer online, Survivor, reality TV show.

• 57:45Ryan Sean Adams?

  With economic reward? Like, do I get the prize for like, if I win?

• 57:49David Hoffman?

  Yeah, economic reward is like putting it into like crypto terms. You get a prize for winning the game.

• 57:54Ryan Sean Adams?

  Oh, yeah. I guess I could just say prize.

• 57:56David Hoffman?

  Yes, it's a prize. It's not like Axie Infinity where there's like an economic game. It's much more like a reality TV show where like, so the way that the game works, this is Crypto the Game. There has been two seasons, so we have seen two of these things happen. Season one lasted 10 days, season two lasted 10 days. Season one had about 300 players, season two had about 800 players. And you put in a .1 ETH entrance fee into the pot. And then the winner gets the entire pot minus the cut for the game devs, who put in a ton of work building this thing. And so it's also like, it's very much like Squid Games. You know, the Netflix Squid Games things where everyone like, it starts off with like a thousand people or whatever, and then it gets whittled down and whittled down and whittled down, and then the last one gets all the money.

• 58:35Ryan Sean Adams?

  But people aren't getting killed here. What, they're just getting voted, voted off, right?

• 58:39David Hoffman?

  Yeah, they get, they get eliminated, yeah.

• 58:41Ryan Sean Adams?

  So it's a social, it's a social game?

• 58:43David Hoffman?

  It's a social game, yeah.

• 58:44Ryan Sean Adams?

  Man, that sounds terrible. This just sounds like high school. I don't want to do this. Why would I do this?

• 58:49David Hoffman?

  Apparently, people are having a ton of fun. And so like, okay, there's the actual game, which is like, once per day, there's a trial that you have to go do. Like a little mini game, like you have to go complete a quest or something. You have to do an on-chain scavenger hunt. Sometimes there's an in of real-life scavenger hunt. There's, there's a bunch of different games. Every 24 hours is like the same. There's a new game. But then, at the end of every 24 hours, there's a voting period to vote people off the island, like vote to eliminate.

• 59:16Ryan Sean Adams?

  Wow, brutal.

• 59:18David Hoffman?

  And so you are in a, you are given a group, you're grouped up at the very beginning. And so you and your group have to like coordinate, and you generally trust each other. But you also know that eventually you're gonna have to vote some of these people off. But mainly, since you're grouped up, you want to vote other tribes off first. And so like, it's a game, it's a game of elimination.

• 59:36Ryan Sean Adams?

  Why don't you do this? Have you done this?

• 59:38David Hoffman?

  I have not done this. I have heard, and one of the things I like about this, actually, is like, it's a very equitable game.

• 59:45Ryan Sean Adams?

  It's not like a popularity contest?

• 59:47David Hoffman?

  No, it's definitely, no. In fact, popularity is like kind of a curse, because then you're a target.

• 59:53Ryan Sean Adams?

  Is that what you're saying?

• 59:55David Hoffman?

  Yeah, so I have been told that-

• 59:55Ryan Sean Adams?

  You're too popular to use it, David? Is that your humble brag?

• 59:57David Hoffman?

  I have been told that if I entered the game as a player, that there would just be a huge target on my back just because like, "Oh, David, let's just vote him off. Let's just get him out of here."

• 1:00:06Ryan Sean Adams?

  I could see that. Given some of your comments on Bankless, I could definitely see that. Made some enemies, David. All right, well, that's cool. So you think it's cool? You think it's something that Bankless listeners might be interested in on the frontier?

• 1:00:19David Hoffman?

  Well, I mean, we have our own employees who are like, can't get their eyes off of the game.

• 1:00:24Ryan Sean Adams?

  I hear me in Discord. I know.

• 1:00:27Ryan Sean Adams?

  All right, all right.

• 1:00:27David Hoffman?

  Some proof is in the pudding. It's one of the most popular things to come out. So yeah, season three will happen in like four to six weeks or something.

• 1:00:35Ryan Sean Adams?

  And if you want to find out more, David did like a 20-minute episode or something. It's on the Bankless premium feed. If you're a Bankless citizen, you have access to that right now. I'm going to actually listen to that and see if it's a... I won't have time for it. I'm not gonna do it. I'll give it up anyway.

• 1:00:46David Hoffman?

  Apparently, it's very consuming for how much... Yeah, but like the winner got 72 Ether of season two.

• 1:00:53Ryan Sean Adams?

  That's big. That's pretty cool.

• 1:00:54David Hoffman?

  That's big.

• 1:00:55Ryan Sean Adams?

  All right, what's the other thing you're on the frontier of these days?

• 1:00:58David Hoffman?

  Okay, so this is the ZeroX Maki project. For those who don't know the lore around ZeroX Maki, he was the first person to step up and run the whole Sushi Swap

• 1:01:10David Hoffman?

  project after Chef Nomi rugged. So generally, like, very technically talented, beloved dev-

• 1:01:15Ryan Sean Adams?

  He didn't rug anyone, though, right? ZeroX Maki?

• 1:01:18David Hoffman?

  ZeroX Maki did not. Chef Nomi did.

• 1:01:20Ryan Sean Adams?

  He was the good guy in crypto history, right?

• 1:01:22David Hoffman?

  Yes, ZeroX Maki was the one that like fixed the ship of Sushi Swap after Chef Nomi like effed it up. But this is ancient 2021.

• 1:01:30Ryan Sean Adams?

  So people are gonna know this.

• 1:01:32David Hoffman?

  Yeah. Anyways, he's been involved with a bunch of stuff. Very well-respected, beloved dev, has been hyping this thing up called Hero Glyphs. And no one knows what this is because it's not released yet, but it will be by the time it's released when Bankless listeners listen to it, because it's releasing tomorrow. And so it's purported, it's touted to be this thing that helps the decentralization of Ethereum, the Ethereum validator network. So it's a mechanism that rewards decentralization. It rewards solo stakers over like organizational or institutional stakers. And everyone's like, "How do you do that? That is an impossible nut to crack. No one's been able to figure out how to do that. Like, how do you even identify solo stakers?" And so I spent like 30 minutes talking with him. It's not on a podcast,

• 1:02:16David Hoffman?

  but if this thing does blow up, maybe we will do a podcast. It's pretty clever. So basically how this works, you know graffiti space in the beacon chain, Ryan?

• 1:02:25Ryan Sean Adams?

  Yeah, I do know this.

• 1:02:26David Hoffman?

  Okay, so in the beacon chain, when you as a proposer of a block, as a ETH validator, there is this thing called graffiti. And actually, I don't know why Core Devs put this in there, and Maki said he didn't know why either, but like there are, is this 32 character space for you to put a little graffiti every time you propose a block to Ethereum. So if you propose a block, you get to say like something, something, something. When Bankless proposes a block, because we run our validators, it says Bankless was here.

• 1:02:53Ryan Sean Adams?

  Yeah, that's right. That's right. I forgot we did that. Yeah.

• 1:02:56David Hoffman?

  So clever.

• 1:02:57Ryan Sean Adams?

  So clever. Super original. I dare you to copy us. It's amazing.

• 1:03:01David Hoffman?

  Anyways, that is kinda like, well, because anything is data availability that has characters in it. And so.

• 1:03:10Ryan Sean Adams?

  I'm shaking my head.

• 1:03:12David Hoffman?

  And so what Xerox Maki is doing is he is using graffiti space to produce like ordinals type things, where, but except instead of producing ordinals, you can actually mint a token on a layer two by encoding using a very like similar to ENS coding scheme. You can like code in a token, so like dollar sign, uh, Bankless.

• 1:03:35Ryan Sean Adams?

  You just create a syntax for it and you stuff it in a block in a place where like, it's not supposed to be, data's not supposed to be here. This is exactly, I'm surprised that, this is such Bitcoin ordinals energy. I'm surprised Casey.

• 1:03:48David Hoffman?

  Rotomor didn't do this?

• 1:03:49Ryan Sean Adams?

  Rotomor isn't doing this, but it's.

• 1:03:51David Hoffman?

  Yeah, but he's a Bitcoiner, right?

• 1:03:52Ryan Sean Adams?

  Yeah, but it's the same kind of approach.

• 1:03:54David Hoffman?

  It's the same concept. It's the same concept.

• 1:03:56Ryan Sean Adams?

  There's this empty data field. We can put stuff in it.

• 1:03:58David Hoffman?

  We could put some tokens in there.

• 1:03:59Ryan Sean Adams?

  If we, if we can just create a scheme and a way to decipher it, then like we can stuff stuff in it. So that's what he's doing. Well, how does this benefit Solistakers? That's the part I don't understand.

• 1:04:09David Hoffman?

  Because you can't claim these, so you, the, who gets these tokens? So the token is minted when you propose a block and you put the token like ticker into the, into the graffiti. But the token is minted on a layer two, so you actually don't touch the layer one. But it's minted to the address that your withdrawal credentials is set to.

• 1:04:29Ryan Sean Adams?

  Oh, cool.

• 1:04:30David Hoffman?

  So a solo stake generally has their withdrawal addresses set to like an EOA that they own. But like Lido does not, like Lido has it set to a DAO, like Rocketball has it set to their org. Any sort of institution has it set to a smart contract. And in this protocol, in Heroglyphs, if your withdrawal address is a smart contract, it's invalid. It is only valid for people who have their withdrawal addresses set to individual EOAs. So it's not a perfect targeting of solo stakers. So it's like, he didn't perfectly crack the nut, but like is directionally correct. And it's going to create a bunch of meme coins that only solo stakers have access to.

• 1:05:07Ryan Sean Adams?

  This sounds so much like runes to me.

• 1:05:10David Hoffman?

  It basically is runes, but using Ethereum beacon chain.

• 1:05:13Ryan Sean Adams?

  It's gonna be the ERC 20 killer is here. It's a Heroglyph. We're gonna encode it in graffiti. Wow.

• 1:05:21David Hoffman?

  Okay, that's cool. It's pretty, I don't know if it's gonna take off. We'll see if it takes off.

• 1:05:25Ryan Sean Adams?

  It's easy for it to take, something like that to take off on Bitcoin, because what other option you have?

• 1:05:29David Hoffman?

  Yeah, I know.

• 1:05:30Ryan Sean Adams?

  This is a little bit different in Ethereum, but it could be good for meme coins. Who knows? I'm sure, you know, we'll have to see.

• 1:05:35David Hoffman?

  The meme is good.

• 1:05:36Ryan Sean Adams?

  David, update us on Solana. So they had like...

• 1:05:39David Hoffman?

  Is this my job?

• 1:05:41Ryan Sean Adams?

  Yes, you are our bankless Solana correspondent.

• 1:05:44David Hoffman?

  Resident Solana responder.

• 1:05:44Ryan Sean Adams?

  So Solana was having some problems with all of the volume it was receiving. In particular, there was a project called ORE that I think was like, quote unquote, spamming the network. Anyway, the end result was people, Solana users couldn't get transactions through.

• 1:05:57David Hoffman?

  Users got pushed out, yeah.

• 1:05:58Ryan Sean Adams?

  They got pushed out. You keep hitting the button and fail transaction, fail transaction. There's supposed to be an update for this. They deployed the update. Am I right about this? Like, what is the update? What happened? Did it work?

• 1:06:08David Hoffman?

  Okay, so Solana version 1.17.31, which is this, I think, short-term interim fix for what is a longer, more sustainable fix, is now deployed. I think the validators are now on this version. I'm not gonna pretend that I know what's in this version, so I'm just gonna read a tweet from somebody who does know. If I just read this out, it would just be a bunch of networking stuff. So a bunch of networking stuff changed in this Solana stack, and now it works better.

• 1:06:33Ryan Sean Adams?

  Well, that was the problem, right? There's still like, one part of the problem was the network tax.

• 1:06:40Ryan Sean Adams?

  That they had chosen just like wasn't wasn't wasn't kind of like scaling to the level that they needed. So they swapped that out. There, there's some other problems like economics, sustainability problems. But what I'm hearing from Solana users, it's been a little bit since I used the Solana network. But what I'm hearing from Solana Power users is it's kind of like cleared up. And part of this, by the way, is Ora has stopped, you know, like the strain of spamming everyone has kind of stopped. So, but also this, this network change was somewhat effective. So there you go. We got our hot takes in.

• 1:07:09David Hoffman?

  Basically, so since Solana does not have a mempool, what becomes the mempool is like the networking layer of Solana, AKA the internet. And so that is the Solana mempool is like the networking layer.

• 1:07:21Ryan Sean Adams?

  Are you asking me this?

• 1:07:23David Hoffman?

  No, I'm, no, I'm telling you.

• 1:07:24Ryan Sean Adams?

  You're telling me that?

• 1:07:24David Hoffman?

  This is what happens when you, when you delete a mempool is that it moves into the networking layer. So it's just like the message passing messaging protocol around Solana. So they're just improving that.

• 1:07:34Ryan Sean Adams?

  David, you want to hear about a stablecoin bill?

• 1:07:36David Hoffman?

  I love it. Tell me more.

• 1:07:38Ryan Sean Adams?

  You don't love it. It sucks. It really sucks. This is Senator Lummis and Senator Gillibrand Bill. It says introduce a bipartisan landmark legislation to create regulatory frameworks for stablecoins. Sounds really good, right?

• 1:07:51David Hoffman?

  Yeah, we do. We do want regulatory frameworks for stablecoins.

• 1:07:54Ryan Sean Adams?

  Okay, so I, I saw this and I was kind of excited. Hey, is it finally time? Are we getting like good regulation around stablecoins? I asked our crypto lawyer friends and my first question was, of course, where I always start with stablecoins. Legislation is, does this kill DAI? Their answer was, yes, it kills DAI.

• 1:08:14David Hoffman?

  Oh.

• 1:08:15Ryan Sean Adams?

  It kills any kind of algorithmic stablecoin, followed by my like crypto lawyer.

• 1:08:21David Hoffman?

  DAI is not an algorithmic stablecoin. They, but they, they say it is.

• 1:08:26Ryan Sean Adams?

  Yeah, it kills DAI, right? Like also Luna and everything like that, but also.

• 1:08:31David Hoffman?

  Let me guess, it kills everything that doesn't have US dollars in a bank somewhere.

• 1:08:35Ryan Sean Adams?

  It might even call kill USDC, David. All right, that's how silly this is. All right, anyway, so the overarching comment from crypto lawyers, because you know, Senator Lummis has been a friend of crypto so called. With friends like these, who needs enemies? All right, that was like the comment, because like this is bad, actually. It kills every stable that's not issued by a bank or a chartered trust. I don't think that's USDC.

• 1:09:00David Hoffman?

  Oh, it's just giving the power to the bank.

• 1:09:02Ryan Sean Adams?

  Yup. And then also it has these like extra territorial provisions, apparently. So it's kind of like exporting, it's imagining that the entire world revolves around the US and we could just like export US law to stablecoin transactions that are completely outside of the US. So it's bad. It's not great. I asked if this was like the bill that's going to go forward. It has some support. It's very early. People are still digesting it. There are other different bills that are in some sort of like formulation phase. So hopefully we just like reform this bill. We get like all the stupid stuff out of it and we get the good stuff back into it. And it's a real bill, but it's like discouraging. It's discouraging because like

• 1:09:44Ryan Sean Adams?

  we kind of help us with regulation, Congress, and that's, this is what they give us? No, thanks. Don't help us with the regulation then. Like just.

• 1:09:53David Hoffman?

  We keep on saying like, hey, we ultimately need to get legislation from the Congress.

• 1:09:57Ryan Sean Adams?

  Yeah.

• 1:09:57David Hoffman?

  And I'm always assuming like, sure, they're gonna throw like seven bad bills at us and then the eighth one will finally be good and we'll just get that one in. But that also was like four bills ago.

• 1:10:06Ryan Sean Adams?

  Yeah.

• 1:10:07David Hoffman?

  And so it kind of just feels like, oh yeah, we actually have to like get a good bill and we haven't gotten that ever.

• 1:10:11Ryan Sean Adams?

  This is Jake Chervinsky. The bill published today is deeply flawed. It appears to ban nearly everything except a narrow band of centralized custodial stablecoins. This would be far worse than this day's quote.

• 1:10:23David Hoffman?

  Sick.

• 1:10:23Ryan Sean Adams?

  You want to run for Congress, David? Let's do it.

• 1:10:25David Hoffman?

  No, absolutely not.

• 1:10:26Ryan Sean Adams?

  You and I, let's go fix this.

• 1:10:28David Hoffman?

  I don't, I don't put that on me.

• 1:10:29Ryan Sean Adams?

  Mr. Hoffman goes to Washington. We'll fix it all.

• 1:10:32David Hoffman?

  I would not survive a day in Washington. I would get chewed up by those politicians.

• 1:10:39Ryan Sean Adams?

  Let's talk about raises, David.

• 1:10:41David Hoffman?

  Two startup raises that we want to highlight out of the Bankless Ventures universe this week. Aligned Layer, raising $2.6 million. Congrats, guys. What is Aligned Layer? Aligned Layer is an AVS, which is outside of the Eigenlayer ecosystem, is basically a sidecar to Ethereum for super cheap ZK verifications. This is in the ZK universe. Basically, just like how we have blob space on the Ethereum Layer 1, EIP 4844. Eventually, in the fullness of time. Ethereum also wants to enshrine specific ZK circuits to have inside of the feature set of the Ethereum Layer 1 to benefit rollups, right? More secure ZK settlement, just like a feature for Layer 2s and just people to use.

• 1:11:22Ryan Sean Adams?

  Because, because ZK EVM, ZK rollups are consuming that service right now, right?

• 1:11:28David Hoffman?

  Totally.

• 1:11:28Ryan Sean Adams?

  You have to get your ZK proof verified on Ethereum and it's expensive right now.

• 1:11:32David Hoffman?

  Yeah, so what if we just actually dedicated a ZK circuit as a part of the Ethereum protocol that Layer 2, ZK Layer 2s could very trustlessly just leverage for trustless perfect settlement of their Layer 2s? This is something that will eventually be inside of the Ethereum protocol. But the total scope of all of these ZK circuits that could exist is completely limitless. And so for everything else that's not making it into the Ethereum Layer 1, there's a aligned layer, an external AVS for any sort of extremely cheap, extremely fast ZK proving, kind of like how EigenDA is similar to Ethereum DA but using Eigenlayer as an AVS. A aligned layer is an Eigenlayer AVS except for ZK circuit proving.

• 1:12:13Ryan Sean Adams?

  Yeah, the net is this is going to be, make proving and verification really, really cheap, which hopefully will enable a massive ecosystem of new ZK apps. Like a ZK rollup is just one type of ZK app and we haven't seen what's possible in kind of this whole sphere.

• 1:12:29David Hoffman?

  Second up is Nebre, which is a ZK proof aggregator. So all of these ZK rollups who submit proofs down to the Ethereum Layer 1, they pay for that, they pay to put their proof down on the Ethereum Layer 1. But a ZK snark is succinct, as in it is a very specific number of characters, that's what the succinct is here. What if Nebre just consumed other people's ZK proofs and then aggregated them all together and spit out another ZK proof to settle all that singular ZK proof down to the Ethereum Layer 1? Economies of scale is more cheap for all of these ZK proofs. And so Nebre, ZK proof aggregator, raised 4.5 million, again, one of a bankless ventures portfolio companies. So congrats to Aligned Layer and Nebre.

• 1:13:11Ryan Sean Adams?

  This is all part of the trend of going from like compute to trustless compute. I mean, there are some ZK bulls out there who think basically the entire internet is going to be ZK-ified.

• 1:13:21David Hoffman?

  I'm one of them.

• 1:13:22Ryan Sean Adams?

  Right? And so like that, that's why we need abundant. We need abundant ZK verification. We need it to be super cheap.

• 1:13:31David Hoffman?

  ZK on your phone, ZK on your browser, ZK on your smart refrigerator, just cuz like everything will be ZK.

• 1:13:39Ryan Sean Adams?

  ZK everywhere. David, tell me about the meme of the week, man. Let's end with this.

• 1:13:44David Hoffman?

  Okay, so this is one of the greatest like tweets I saw this week. Tim Koplin tweeting out the classic shot chaser line. And Avi, Avi Eisenberg, if you guys remember this name, who is the person who did some on-chain market manipulation of, I believe, Mango Markets? If the meme, "I executed a highly profitable trading strategy," means anything to you, this is that guy. And right after this individual manipulated some economic oracles to exploit Mango Markets, he tweets out, "What are you gonna do? Arrest me?" And this is when, right after he just exploited.

• 1:14:21Ryan Sean Adams?

  2022.

• 1:14:22David Hoffman?

  In 2022, he exploited Mango Markets for like some millions of dollars. And here is a picture from an article that went out, the justice last week. "Federal jurors in New York on Thursday found Avi Eisenberg, 28, guilty of commodities fraud, commodities manipulation, and wire fraud for his actions on October 11th, 2022, when his trading boosted the prices of future contracts by 1,300% in 20 minutes. Sentencing is set for July 29th. He was indeed arrested."

• 1:14:51David Hoffman?

  Crimes are still crimes when you do them in crypto. PSA, it's a bankless nation.

• 1:14:56Ryan Sean Adams?

  So if I, if I steal your crypto money, David, it's still stealing, huh?

• 1:15:00David Hoffman?

  That is still theft. If you steal crypto from someone, it is still theft. If you manipulate markets, it is still illegal commodities market manipulation. Crimes are still crimes when you do them in crypto. Public reminder.

• 1:15:11Ryan Sean Adams?

  I thought all of this was like imaginary money, but like it's good to know that this is serious stuff. Crimes are crimes. All right, guys, let's end with this. Of course, you know crypto is risky. Loose what you put in, but we are headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the Bankless journey. Thanks a lot.