1 Billion Users Onchain | Jesse Pollak of Base

While it's still early in the race, Base is now one of Ethereum’s largest L2s. In today’s episode, we brought back on repeat guest and co-creator of Coinbase’s L2, Base, Jesse Pollak. We cover: - How Base plans to bring billions of users onchain - How Base is increasing its scale by 400x - How Coinbase is using Base to be more onchain - Onchain Summer II ------ 📣 TRANSPORTER - SECURED BY CHAINLINK CCIP | TRY IT OUT transporter.io https://www.transporter.io/?&utm_medium=paid-affiliates&utm_source=bankless&utm_campaign=ga&utm_content=qv25541ars2s ------ BANKLESS SPONSOR TOOLS: 🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE https://k.xyz/bankless-pod-q2 ⁠ 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🌐 CARTESI | APPLY FOR A GRANT https://bankless.cc/CartesiGovernance 🔗CELO | CEL2 COMING SOON https://bankless.cc/Celo 🏠 CASA | SECURE YOUR GENERATIONAL WEALTH https://bankless.cc/Casa 🗣️TOKU | CRYPTO EMPLOYMENT SOLUTION https://bankless.cc/toku ⚖️ARBITRUM | SCALING ETHEREUM ⁠https://bankless.cc/Arbitrum https://%E2%81%A0https//bankless.cc/Arbitrum ------ TIMESTAMPS 0:00 Intro 4:41 Base’s First 8 Months 9:23 The Road to 1 Giga Gas Per Second 18:39 Why More Demand For Base? 21:26 Cost to Send Transactions on Base 23:59 Non-Ethereum DA Solution? 25:59 Scaling Via L3s on Base? 27:17 Parallelization Solution? 29:34 Will Base Make Transactions Free? 38:18 Coinbase's Relationship With Base 46:18 Base Is Centralized Critique 50:17 The Base Flywheel 57:46 Onchain Summer II 58:36 Next Target Demo to Come Onchain 1:00:42 Base Independence 1:02:19 1 Billion People Onchain 1:03:25 Closing & Disclosures ------ RESOURCES Onchain Summer II https://www.base.org/ Jesse Pollak https://twitter.com/jessepollak Jesse’s 1st Base Episode https://youtu.be/7dGU0_eEjq8 Coinbase https://twitter.com/coinbase Base https://twitter.com/base ------ 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.

• 0:00Speaker 00

  I think that this is the decade of the world moving on-chain, and I think that we're going to see it faster than people anticipate. And so I don't know whether it will be in the next one to two years, or the next three to five years, but I really do believe that this is the decade where we'll see it happen. And by the end of the decade, the whole world's going to be on-chain.

• 0:18David Hoffman?

  Welcome to Bankless, where we explore the on-chain frontier with Base's Jesse Pollak, co-creator of Base. We're here to explore how Base is trying to get to 1 billion users on-chain. We also are trying to get to how Base is trying to increase its scale by 400x to 1 billion gigagas. We'll explain what that is in the show. How Coinbase is using Base to put more of Coinbase on-chain. And where all of this leads to is on-chain summer, round two. We've already done this once, but we're about to do it again. And then next summer, we'll do it again. And next summer, we'll do it again. Before we get into the conversation, a message from our friends and sponsors over at Transporter, a brand-new bridging app called Transporter, great name. Why do we need it?

• 1:02David Hoffman?

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• 1:29Ryan Sean Adams?

  I think this is a cool conversation, David, because we're talking about something that's very important in crypto, which is, number one, how we're scaling Ethereum itself. So this is a story about Layer 2s and how that scales, and especially in a world where we have blob space. And also, this is a case study for how a centralized company, Coinbase, an exchange, is slowly migrating on-chain, what that looks like. I think it's a fascinating case study, and why folks should tune into this episode and be following in general the Base story.

• 1:58David Hoffman?

  I think the most interesting part of this conversation was at the very, very end, just to tease the end of the conversation, when I asked Jesse whether or not Base would ever spin out of Coinbase, which was a question that was a means to an end of something bigger, but I'll leave that up to the imagination of the listeners. So let's go ahead and get right into the conversation with Jesse Pollak from Base. But first, a moment to talk about some of these fantastic sponsors that make this show possible. 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

• 2:41David Hoffman?

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• 3:24David Hoffman?

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• 4:08David Hoffman?

  Secured by Ethereum validators and one block finality. What does that all mean for you? With Cello Layer 2, gas fees will stay low and you can even pay for gas natively using ERC 20 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.

• 4:33Ryan Sean Adams?

  Bankless Nation, we have Jesse Pollak. He's the co-creator of Base, which is the Coinbase Layer 2. Jesse, how you doing?

• 4:40Speaker 00

  Doing great. Happy Monday. Hey, guys.

• 4:42Ryan Sean Adams?

  Hey, it's great to have you back on Bankless. You know, we were just checking some of the stats on Base recently and we thought we have to have Jesse back on to tell us what's going on. And a couple of stats that come to mind. Base is now number three in terms of Layer 2s by total asset value. So total locked value at like 5.2 billion. In terms of daily or weekly active users, it's trending at 1.3 million. You've got fees that are, you know, between like 5 cents or under on Base. And I think Base launched in August of 2023, if I'm recalling correctly. Give us a summary. So how have things gone so far?

• 5:26Ryan Sean Adams?

  And how far in the journey are we?

• 5:29Speaker 00

  Yeah, yeah. Well, we're still at day one. This is what I tell my team every day. It's like, it's still day one. We have so much more to build. There's so much more work we have to do to bring the whole world on-chain. That said, I mean, we're about eight and a half months in right now. And I think the team and I are pretty blown away with the amount of progress that we've made. I kind of see this in three general kind of phases of the last nine months. The first phase was on-chain summer. It was so exciting. We saw, you know, millions of people come on-chain on Base, so much energy. I think a really like great way to kick off the network and the economy and get a lot of that kind of culture that we wanted to make happen, kind of thriving.

• 6:12Speaker 00

  And there's a big boom in metrics and all of the kind of outcomes that we were looking for. And I'd say after OnChain Summer in the kind of fall, we basically saw things kind of like tail off, flatline a little bit, like a little bit of trough of sorrow. Like, we had this big launch, it was really exciting. Now, like, we're met with reality. Our team was also candidly just pretty exhausted. Like, we pushed so hard for a year to get that thing out. Worked so hard during OnChain Summer and took, like, September, October, November. It was a little bit of a reset where it was like, okay, let's get our equilibrium back. Let's also think a little bit broader of like, okay, we made this first push. Where do we go over the next one to two years? How do we really crystallize our mission, our strategy?

• 6:57Speaker 00

  I think we did a bunch of good work there. And then I'd say the third phase was really like Q1 of this year, which we entered the year kind of in the top 10 by activity and TVL. And I think if you look at the metrics now, yes, we're third in terms of TVL, which is, you know, a very like lagging metric, I'd say. And there's people who've been building for three years. And so it's going to take a long time for us to catch up there. But if you look at daily actives, DEX volume, you know, developers. At this point, Base is the largest Layer 2 in the world. And most days were, you know, competing to be the largest chain in the world after Ethereum. And so that, I think, is pretty remarkable. And there were really two catalysts, I think, we really saw kind of driving this in Q1.

• 7:40Speaker 00

  One was the launch of Farcaster Frames, which I think, you know, happened in January. We really leaned in, built a ton of developer tooling. And as a result, saw our market share of like Farcaster activity go from 15% to something like 75%. And I think a lot of the best builders are on Farcaster. And so that was this catalyst that kind of got us having more and more of those builders building on Base. And then I'd say the second big catalyst was EIP4844, which we'd worked on for two years, starting in 2022, even before Base was like kind of a twinkle in my eye. And we landed and were there on day one with support for. And I feel like there was this kind of moment that, I don't know if you guys remember that day, but I don't think our team will ever forget it.

• 8:23Speaker 00

  It's like 4844 landed on Ethereum, Base upgraded to support it, and like the internet broke. It's like every single post in my Twitter feed was people being like, oh my God, look at how cheap fees are on base. And that, I think, kind of like, we'd been flat, we saw a little up curve from the Farcaster stuff, and then post 4844 went kind of vertical in all of the metrics that we care about. And that has kind of been the story of Q1. And now, I think, we've established ourselves as the market leader, the place where everyone wants to build. And I think it's mostly about, okay, how do we make sure that we're further solidifying that kind of place, that role, and invest more heavily in our ecosystem,

• 9:06Speaker 00

  in our economy, to ensure it can keep growing? Because, kind of going back to the beginning of my answer, it's day one. If you look at how many people are on-chain, it's still, you know, hundreds of thousands a day, probably, and we have to get to billions. And so that's like a 10,000x. So a lot more work ahead.

• 9:23David Hoffman?

  There's been just this iterative cycle that exists before crypto between infrastructure and apps, right? Where infrastructure gets built out, apps consume that infrastructure, then apps get constrained by the scale. So then the scaling goes back down to the infrastructure. It takes the infrastructure a little bit of a while to scale out, but then it provides more scale to the apps. And then this is the iterative cycle. And we've seen this happen with a handful of protocols, a handful of Layer 2s, and also Layer 1s. Solana is experiencing the same thing, right? Like, demand for Solana block space produced some of the growing pains out of the Solana ecosystem. Not too long after 4844 happened, we actually saw the constraints of base. Despite all of the abundance of block space, there also seems to be an

• 10:06David Hoffman?

  abundant demand for block space. And we saw some of those constraints hit thereafter. So you've been on this campaign, Jesse, of the road to one gigas per second. Maybe you can talk about just like, why this goal is important, and what is a gigas per second? What is that a measure of? And like, why is this North Star important for the base vision?

• 10:28Speaker 00

  Yeah, absolutely. And maybe just to kind of refresh folks, so on like middle of March, we upgraded Ethereum with 4844. What that did was it basically brought down the L1 costs for base and other L2s. So now we have this new place where we can store data that's purpose-built for rollups. That makes it so instead of paying a ton of money for for all of the data we're storing on L1, we pay a lot less. You know, really incredible solution, I think is going to enable L2s to scale as a part of kind of Ethereum's rollup-centric scaling strategy. And so, post that launch, we saw base fees drop really, really low, but then we also saw a massive increase in demand. You know, I think we 5X'd demand over about like a week and a half. And what we started seeing on base as a result is now

• 11:13Speaker 00

  the L1 costs were very low, but because of the increase in demand, we started to see actually like somewhat high fees on the L2. And this is because, like Ethereum, base has a fee market, which is defined basically based off of two things. One is what's called the gas target, which is basically, you know, what is the target amount of gas per block or per second that the base network can kind of process? If it's processing above the target, fees start going up. And that's the second part of the mechanism. It's 1559, same as Ethereum. They start going up exponentially. If the amount of gas being processed every

• 11:56Speaker 00

  block is below the target, they start going down. And so it's kind of this like automatically recalibrating system where if there's more demand on the network than the network can support, you have rising fees. If there's less demand, then you have lowering fees. And so we saw more demand than our target could support, which kind of drove up our fees very aggressively. Now, the the thing to know about the target is it's a variable, so you can kind of change the target. But if you change the target, it has a bunch of other downstream effects. And You can't change the target willy-nilly because those effects can be really problematic. And so instead, you need to kind of apply a very principled approach to how do you change the target such that the network can scale healthily.

• 12:38Speaker 00

  And so we kind of look at that as three primary problems to solve. One is, when you increase the target, you need to have more data availability. That's, you can actually put all those transactions in. More gas means more transactions, means more storage that has to put on the L1. So we need to continue scaling the amount of L1 data availability through things like pure DAS and the whole proto-dank, or dank sharding roadmap.

• 13:03David Hoffman?

  Yeah, this is an Ethereum Layer 1 roadmap question.

• 13:06Speaker 00

  Ethereum Layer 1 roadmap question, but we're going to keep investing in that. We're working on pure DAS prototype, like, we've been contributing to Ethereum L1. We're going to continue contributing to Ethereum L1. The, the second kind of challenge is, like, how much gas can the actual L2 node process? Like, literally, how fast can it run? If we're running two-second blocks and we want to process, you know, 10 million gas a second, can we get all of that gas processed in those two seconds? Or in less than those two seconds? So that all the nodes can keep running? And that's just a lot of kind of like EVM optimization. Can we do things optimistically? Can we change the database format so it works better? So that's the second thing. And then the third thing is, and, and there's a kind of, actually, in the second thing,

• 13:51Speaker 00

  there's kind of a related point around hardware. It's like, can we increase the hardware requirements? And the cool thing about L2s is that they don't necessarily have the same hardware requirements as the L1 because of how they're designed. So we can, but we don't want to go too far because it makes it too expensive to run the nodes. So that's the, that's the, the second big thing. And then the third big thing is state growth, which is basically, like, if you run the chain very fast, and now you have it running very fast, you have all the data availability on it, then you get this really, really, really big chain. And it's all this data that people have to store, and that causes a bunch of other downstream problems. And Ethereum's been kind of starting to think about these problems and solving them with things like vertical trees and state expiry, or, or state, kind of like offloading to other parties. And that's a third kind of open research problem that we have to solve.

• 14:36Speaker 00

  And so in order to feel confident increasing the target, which is just this variable, behind the scenes, you actually need to solve really, really, really hard engineering challenges. And so when base started seeing these increased fees, I think the the feeling for me was like, OK, we kind of need to change our focus and narrative a little bit. We've been just focused on this L one thing of increasing data availability and lowering costs for two years. And now we need to kind of like shake the team and shake the industry and be like, OK, the rules have changed. Like now we have a bunch of L one data availability, you know, we're going to use it, but we also need to focus on EVM scalability. We also need to start focusing on state growth. And so I kind of came out there and said, hey, we're going to start solving this. We're going to set

• 15:20Speaker 00

  a really aggressive goal, which is one gig of gas a second. And that goal had kind of come from conversations with the paradigm and rest team who we've been working really closely with. Huge shout out to them. And if you look at where we started, which was 2.5 million gas a second, or 2.5 M gas a second, one gig of gas is 1,000 million gas a second. So it's 400x where we started in this process. So we kind of set that really aggressive north star. And then we basically started working internally to be like, OK, like, how do we 400x? And so what we pretty quickly initially figured out was, we had

• 16:01Speaker 00

  enough headspace to do a couple increases. So over the next two weeks, we did about a 2x. We went from 2.5 M gas a second to 5 M gas a second. We're now in the process this quarter of trying to get to 10 M gas a second. We feel like there's a pretty clear line of sight there. And then we're going to continue just trying to double until we get all the way up to 1,000 M gas a second, or one gig of gas a second. And along the way, we're going to solve, or push forward at least, a lot of these really hard challenges that are kind of invisible constraints that are limiting our ability to continue scaling the network.

• 16:36David Hoffman?

  So this is just what it's like to be a base engineer. It's like this is the landscape that you have to work with and the North Star that you need to get through. I remember post 4844, I think Vitalik released a blog post where he said that the end of Ethereum zero to one moments is upon us. Like now that's in the rearview mirror and now it's more about getting from one to 10. And what he meant by that is a bunch of incremental steps rather than a binary like step function of like, like the introduction of 4844, right? Like a binary improvement in Ethereum. Now it's all about just like incremental steps in like seven different directions that are all kind of slowly multiplying together. There's not one silver bullet here, but now it's just a bunch of incremental improvements

• 17:19David Hoffman?

  in like five or six different directions, which Base has its fingers in all of them because it's a network. But the beautiful thing about this is that like if Base solves any sort of frontier problem, this actually gets to be scaled out for the rest of the Ethereum layer two space, right? So like you guys are building for yourselves, but also for the rest of the industry.

• 17:38Speaker 00

  Yeah, and I think this is really like one of the most important things about how we've decided to build Base. It's like all of our contributions to Ethereum L1 obviously impact the whole industry, but we also decided to build on an open platform in the OP stack. And so all of our contributions to the OP stack also really help the industry. And if you look at the current OP stack core development process and outcomes, the Base team just led the most recent upgrade. We did almost most of the work. We did the governance proposal and we're also leading the next upgrade, Fjord, where it's more scaling stuff. We're going to decrease L1 costs 10 to 20%. We have a bunch of other really positive changes going in there. And all of those benefits, they accrue to any other network that's running on the OP stack.

• 18:22Speaker 00

  And I think that that's been really essential to us from the beginning. One of our values has been decentralized and open source. And it's because we believe that this really is a collective effort. And the more we can contribute to things that accelerate us, but also accelerate the industry, the better outcomes we're going to get for everyone building on chain.

• 18:39David Hoffman?

  You said with the introduction of 4844, there was just a marked increase in the consumption of base transactions. And this was more or less expected. We were all chanting the chant of induced demand ahead of the 4844. But it also seems to be that there was actually more than some induced demand. This is kind of my gut take. Do you know where that demand came from? Like, why were people doing extra things on base? Like, what was driving some of that demand?

• 19:04Speaker 00

  Yeah, it was definitely more than I think we anticipated. I think if you look at it across the whole industry, though, it maybe wasn't like it wasn't more for everyone. It was just more for base. And that, you know, there's some exceptions to that rule. But like, there's a reason why base is now, you know, processing twice as many transactions in Arbitrum or other networks. It's because there's been more transactions that have moved to base than elsewhere. I don't have like a specific answer for you there of like, oh yeah, it was this specific thing. I'm more think that there was something about like the combination of the developer go to market we've been running and the timing for our launch and just the moment of all these pieces fitting together where when people like kind of saw this 4844 thing happened,

• 19:48Speaker 00

  they projected it onto base the most. And they were like, oh, this is where this is unlocking us to build more better things. And I think if you look at the kind of builder metrics, that's what you see. Like, one of the metrics that we look at the most is what we call like revenue generating deployers, which is basically like, how many people deploy smart contracts onto base and other networks that go on to generate meaningful revenue? Because it's basically a measure of like substantive, high quality developers. And if you look at the graph, it's like we were flat. And then the Farcaster frame stuff happened and we did like a slight up curve and started growing. And then 4844 happened and we started going through the roof.

• 20:29Speaker 00

  And today, base has more revenue generating deployers than every other L2 than Polygon POS. And I think we're about across Ethereum. And that has just been like up and to the right. And I think a lot of that is basically the moment and the like convergence of a bunch of different factors that caused a lot of developers to come on chain for the first time on base, as well as a lot of developers to refocus their efforts onto deploying things on base.

• 20:56Ryan Sean Adams?

  I really like that that metric of revenue generating deployers. Like one framing for this is it's basically entrepreneurs. It's basically small businesses that have decided to set up shop in this new area. We've often talked about Ethereum in the context of it's Manhattan. It's busy, it's grown up, it's really expensive, right? And now with these these layer twos, we've got new suburbs that are opening. And when you're talking about revenue generating deployers, you're just talking about like businesses popping up.

• 21:21Speaker 00

  There's businesses.

• 21:22Ryan Sean Adams?

  There's restaurants, right? There's movie theaters, there's all of these small businesses popping up. That's very cool. I want to ask some kind of like dumb questions, maybe from a user perspective.

• 21:30Speaker 00

  No dumb questions.

• 21:31Ryan Sean Adams?

  For you, Jesse. Okay, so like maybe some obvious questions to you, but you're talking about it from a system perspective. I want to look at this from a from a user perspective. So it cost, I believe, right now, I was just looking at the charts coming to this, about one cent to transfer ETH on base. Like, that's the cost for a user for a transaction. If I want to send you some ETH, Jesse's going to cost me one cent. What was that prior to EIP 4844?

• 21:54Speaker 00

  Yeah, I think like our me, I was just looking at the metrics. I feel like our median fee decrease was something like 80 to 90%. And so that makes it so like the, you know, but that actually impacted like higher gas usage things more than the else. ETH sends. And so I think that that would have probably been in like the 10 to 30 cent range, basically, if we're doing ETH send.

• 22:19Ryan Sean Adams?

  And then what do you want it to be? Or is that an impossible question to answer?

• 22:23Speaker 00

  We want it to be as low as possible. I think our kind of like internal north star across all of Coinbase is one second, one cent. Which is we want average and median transaction fees to be less than one second, be less than one cent processed in less than one second. And that's that's just kind of like, I think, for us, a thesis around kind of like the on-chain broadband moment. Where it's like, if you have cheap enough transactions and fast enough transactions, anything is possible on chain. And so, yeah, we want to scale it probably another 10,000x in terms of the number of users, while keeping those kind of costs and speed down sub-second, sub-cent.

• 23:01Ryan Sean Adams?

  Okay, so you're talking about the the three buckets of of costs that go into a transaction. So of that of that one cent, you know, how much of that is that first bucket that you're talking about, which is Ethereum layer one versus the the other two buckets?

• 23:16Speaker 00

  Yeah, so today, most of the cost is actually not Ethereum Layer 1 because of the kind of usage of the L1 gas market. Like, we aren't using all of the blob space. And what that means, it means that blob fees are very, very cheap, essentially free. I think that that will change in the next few months. We'll start using that, and then we'll have a market-based fee, which will bring it back to probably something like, you know, 5 to 30% of the L1 fee. And then there's kind of the like L2 market-based fee, which is like, depending on how much the target is, and how much demand there is, there's going to be higher or lower fees. And so that will make up the rest of the fee.

• 23:59Ryan Sean Adams?

  The way we've described the IP 4844 is it's almost like another lane that's opened up, like a high occupancy vehicle lane. And right now, it's cheap because it's not full, right? But that could change in the future. Let's say if that changes and that HOV lane becomes expensive yet again. So Ethereum blob space is full and all of the Layer 2s are kind of competing for it. Would you ever consider using a non-Ethereum DA solution? Because there are some of those springing up, and that could be a source to reduce fees as well for Base?

• 24:29Speaker 00

  Yeah, I mean, like, look, we think pretty expansively always of like, what are the different options for scaling? I think our current perspective is there's a very clear roadmap for Ethereum data availability scaling that just needs to be executed. Like, PureDAS is the next milestone. That gets us another 10x potentially of data availability. And so our top priority is executing on that, just like our top priority previously was executing on 4844. And we think that that's going to be more than enough, at least data availability for the for the next phase of Base's growth. When we think about the like, mission and vision and strategy of Base, we're really trying to build a global on-chain economy that increases innovation, creativity, and freedom. And I think one

• 25:10Speaker 00

  of the things that is required for building a global economy is trust, and security, and surety. And when I think about the trust and security and surety that you get from depending on Ethereum for data availability alongside settlement and

• 25:26Speaker 00

  And kind of all the the L1 logic that sits there for L2s. It's just so much higher than I think the the trust that you get from starting to kind of like fragment those things and introduce basically new trust systems into your your technology stack. And so I think for base itself, it would it would it would have to be pretty extreme costs for us to to. I I don't even know if there would be a scenario. I think like, again, we're we're optimizing for trust and and kind of that that long term outcome. And I think we're going to be able to solve all of our needs on the Ethereum side.

• 25:59Ryan Sean Adams?

  So Jesse, if layer ones are expensive and layer twos are less expensive, why don't we just scale with a whole bunch of layer threes on base?

• 26:07Speaker 00

  I think we I think we well, AI, I think there will be a lot of layer threes on base. And my thinking on this is somewhat evolved in the last year as I've started to kind of build a better mental model for how these pieces work. I I generally think like layer threes can be analogized to just servers. They're just servers that run a slightly more connected on chain and let you more easily bring in the on chain assets into your kind of dedicated compute environment. And there's a lot of people who want to run servers. And they run all kinds of different servers with different trust characteristics and different stacks and languages and tooling. And I think we're going to see the same proliferation at L3, you know, on base in other places.

• 26:48Speaker 00

  And, you know, today, I think we are tracking like six or seven L3s that are running actively on base. I expect that to grow to hundreds this year, potentially more. And I think it's going to be a really fertile ground for experimentation because it's going to be way cheaper. Because you're going to have easier on rams for users.

• 27:06Ryan Sean Adams?

  And an L3 on base is just another chain that, you know, it deploys on top of the base L2. And so settlement on base L2 and data availability on base L2 or elsewhere. What about another solution to your second and third bucket for low like high transaction fees and gig gas, which is just like parallelization, right? So like, there are a lot of Solana has kind of like pioneered this. But now there are other EVM compatible, parallelized execution environments as well. What do you think about that in terms of roadmap items for base?

• 27:41Speaker 00

  Yeah, absolutely. I mean, I I kind of I bucket this into the like EVM optimization, which was kind of bucket two of the what do we need to do to increase target? There's a lot of stuff you can do with kind of parallel, like optimistic parallelization just in the EVM that doesn't break EVM compatibility. You know, it doesn't get you always all of the gains, but you can still do a lot there. And we're really excited about that. And again, like, we've been working closely with Paradigm and Ref team, and you know, they've been thinking a lot about that. And we're excited to collaborate with them further there. I also think there are some things that could be like breaking changes. For instance, you can do a lot more with parallelization and in general, kind of like

• 28:22Speaker 00

  state isolation, if you require access lists, where developers actually have to specify, here are the things I'm going to access in this contract. Because it then lets you, or in this call, because it then lets you kind of do a lot more in terms of figuring out how it's going to execute. That would be a breaking change, like, you know, there's all the stuff that's deployed that doesn't have those kind of access list defined, and we need to change it for new things being deployed. I don't have a strong opinion about is that the right thing to do or not. I do believe that there's value in thinking expansively about kind of this L2 problem space and how we evolve the EVM at L2 and how that might change versus L1.

• 29:06Speaker 00

  And I think it's been exciting to see efforts to to start to do that in a way that is both kind of thinking expansively and staying kind of aligned and connected. You know, there's this thing called RIP or Rollup Improvement Proposal. And that's like run by Ethereum core devs in collaboration with L2s, working to evolve the L2 EVM while still staying connected. And I think we'll see a lot of progress and impact as a result of those sorts of experiments.

• 29:35Ryan Sean Adams?

  So Jesse, crypto natives, they're used to paying fees for transactions, right? So you take, go from Ethereum to you go to Base, and you're like, oh, man, this is so much cheaper, isn't this great? Okay, but but normies out there, mainstream, the billions that you're talking about that you want to bring on chain, they're not used to paying transaction fees for doing things at all in Web2. So what's your thought on that? And like, why generally? So someone comes externally and they're like, Jesse, you know, one cent is great, but you know what's better than great is than one cent is free. So how about you go make my transactions free? Why can't you do that?

• 30:04Speaker 00

  Yeah, yeah, I totally agree with that. And I think this is one of our theses that's starting to play out, which is that as costs on the L2s and other compute environments go down, you'll actually see developers internalize more of the costs into their own business model and structure. So whereas right now, because fees have been so high and because the technology hasn't really been there, like users are paying for those fees, I actually think we're going to move towards a world increasingly where developers cover all the kind of gas compute costs, and then they make money from their business in some way, and they use that to cover their expenses. And this is not like some crazy novel idea. This is the way businesses have worked online forever, right?

• 30:46Speaker 00

  Like, you don't pay your AWS costs to use Google Chrome or to use Riverside or TikTok. That'd be weird. But instead, TikTok or whoever pays those costs, they make revenue, they pay those costs. And I just think it hasn't been really possible, but now with lower fees and with things like Paymasters, which are now possible with smart wallets and 4337, we're seeing more and more of that happen. And so one of the ways we're trying to accelerate that is we're actually giving away gas grants to developers all across Base. So today, if you go to Coinbase Developer Platform, or Alchemy, or Biconomy, or Stackup, or Pimlico, or pick your favorites, account abstraction tooling, you can go get a grant

• 31:31Speaker 00

  from Base to fund transactions for you, to give your users free transactions. And that kind of gives you the opportunity to experiment and learn about how do you kind of evolve your business model and product such that you can continue to provide kind of a gasless experience while generating revenue that you can use to then cover gas. And so I think that this is going to be a really, really fruitful place for innovation. It's something we're pushing on really hard because it will make the user experience much better.

• 31:59David Hoffman?

  So this isn't something that you are actively working on as part of the Base like protocol. This is something you're kind of pushing responsibility towards the app layer devs, and then giving them the support and the tools that they need to be able to execute on like a gas-free vision.

• 32:12Speaker 00

  Yeah, yeah, exactly. We basically think that like, building infrastructure on top of the chain is the best place for this. Because I think if you look at... This sort of compute, like it always is going to have to be priced in some way, because that's how you get this kind of like efficient market, where people are paying however much it's worth. And I think you run into a bunch of other challenges if you don't have that. And you know, if you talk to Solana folks, I actually think this is one of the things that they're running into a little bit right now is you don't have an economic model for priority fees in getting transactions submitted on Solana right now. And so what that's leading to is people basically trying to game the system by submitting, you know, thousands, millions of transactions, and that then leading to network instability.

• 32:57Speaker 00

  And so like economic kind of mechanisms are really, really valuable for designing the sort of highly available, highly decentralized, highly resilient systems that and compute that blockchains can offer. So I think they need to exist, but I think by kind of working up one layer above and then building a bunch of infrastructure there that enables us to build on top of that in a really seamless experience, we can get a lot done. And one, I was actually tweeting and casting about this the other day is like one primitive that I think is missing today that I think we really need is better kind of like hedging and market infrastructure for both L1 gas prices and L2 gas prices. Like ideally, we'd be able to create a market on base where we could efficiently price

• 33:41Speaker 00

  future gas costs and the gas market such that we could give developers actually more consistency so they could say, oh, we're going to spend, you know, 10 million gas over the next three months of running our app. Let's commit to buying that upfront and have a like known cost that we can understand and then kind of smooth that out with the market so that someone else is kind of taking on the risk and, you know, willing to trade that. So I'm talking to a lot of teams who are doing that right now. I think that's going to be kind of the next big primitive that will unlock a lot more design space here.

• 34:16David Hoffman?

  Yeah, it sounds like gas credits. And then, of course, there's that famous Ray Dalio story of like, he did some like crazy financial engineering with some sort of like chicken futures thing. And at the end of that, at the end of that financial engineering, the chicken nuggets product was produced out of McDonald's. So maybe that's kind of the thing that you're going for. Thank you, I guess. Thanks, Finance, for the chicken nuggets. 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, 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

• 35:00David Hoffman?

  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 Web3 space for Mantle. Mantle already has sub-communities from around Web3 onboarded, like Game7 for Web3 gaming, and Bybit for TVL and liquidity and on-ramps. 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, check out Mantle at mantle.xyz and follow them on Twitter at @zeroxmantle. Arbitrum is the leading Ethereum scaling solution that is home to hundreds of decentralized applications.

• 35:43David Hoffman?

  Arbitrum's technology allows you to interact with Ethereum at scale with low fees and faster transactions. Arbitrum has the leading DeFi ecosystem, strong infrastructure options, flourishing NFTs, and is quickly becoming the Web3 gaming hub. Explore the ecosystem at portal.arbitrum.io. Are you looking to permissionlessly launch your own Arbitrum Orbit chain? Arbitrum Orbit allows anyone to utilize Arbitrum's secure scaling technology to build your own Orbit chain, giving you access to interoperable, customizable permissions with dedicated throughput. Whether you're a developer, an enterprise, or a user, Arbitrum Orbit lets you take your project to new heights. All of these technologies leverage the security and decentralization of Ethereum. Experience Web3 development the way it was always meant to be: secure, fast, cheap, and friction-free.

• 36:26David Hoffman?

  Visit arbitrum.io and get your journey started in one of the largest Ethereum communities. 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 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,

• 37:08David Hoffman?

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• 37:51David Hoffman?

  And with Cartesi's unique rollup framework, you'll get real-world scaling and computation. No more competing for block space. So if you're a developer looking to push the boundaries of what's possible in Web3, Cartesi is now offering up to $50,000 in grants. Head over to Cartesi's grant application page to apply today. And if you're not a developer, those with staked CTSI can take part in the governance process and vote on whether or not a proposal should be funded. Make sure you're vote ready by staking your CTSI before the votes open. I want to open up the conversation to Coinbase's relationship with Base. There's a tweet that I want to read from Max Brandsberg. He says, Going forward Coinbase is going to be storing more corporate and customer USDC balances on base.

• 38:33David Hoffman?

  This enables us to manage and secure customer funds with lower fees and faster settlement times with no impact to the Coinbase user experience. We are excited to continue to move our business on-chain and hope other companies will follow our lead. Since this tweet went out, the supply of USDC on-base is just absolutely parabolic. I can only imagine because Coinbase followed through on exactly what they would said of actually using base as its own backend. Can you talk about just this decision? I'm assuming it starts with USDC from customer and corporate accounts, but it might increase in scope from there. Talk about like what this means and where this goes.

• 39:08Speaker 00

  Yeah, I mean, I think if you look back at kind of the mission, vision, strategy of Coinbase, what you see in a blog post, you know, Brian wrote in 2016 is, you know, we've had this four-phase plan for building the on-chain economy for eight years at this point. You know, he laid it out, he was like, first, we're going to build the protocols, then we're going to build the exchange, then we're going to build the consumer interfaces, then we're going to have millions of apps that billions of people use. And I feel like right now, we're kind of between phases three and four, where we have the starts of these interfaces and Coinbase and Coinbase Wallet and other kind of browsers and wallets. We're also starting to see kind of the start of these apps where we have lots of apps that are being built on-chain on-base and other networks that people are starting to use.

• 39:51Speaker 00

  But we're obviously like pretty far away from having millions of apps that billions of people are using. And I think the thesis with Coinbase is we too are going through this transformation where we started from a place of 2012, you know, web two, let you buy Bitcoin, that was all we did. And now here we are 12 years later. And in many ways, we're still a kind of off-chain custodial centralized business with crypto in it. We're letting people do things with crypto, but they're doing it off-chain, you know, in their kind of like web two products. And I think we see an opportunity for kind of us to lead the way in showing everyone, what does it look like to take these users, these assets, these products and move them on-chain? And what are the actual benefits that we get from that?

• 40:36Speaker 00

  I think when we think first principles about the benefits, it it starts to become pretty obvious to us why we would do this. First off, it's it's way cheaper. You can build the same products on-chain as off-chain at 10x lower cost. And I think Uniswap is a great example of this. You know, it took like two engineers to build the first version of Uniswap versus building a centralized exchange can take, you know, tens or hundreds of engineers from an engineering perspective. So that's one benefit, way cheaper. The second benefit is things are globally available from day one, right? Like if you build something on-chain, it's available to everyone by default. Whereas if you build things off-chain, you run into more challenges in terms of how you make it available to people and what the different kind of engagements you need in different places in order to unlock that. So so that's a that's a really big benefit.

• 41:20Speaker 00

  The third benefit is composability. If you build something on-chain, it automatically works with everything else that's on-chain. Things just plug in, people can build on top of it, they can leverage it. Versus if you build things off-chain, then everyone needs to integrate with you through legacy APIs. And so when we kind of evaluate this from a business perspective, from a Coinbase perspective, I think, you know, folks like Max, who runs our consumer businesses, they look at this and they're like, yes, we need to do this because it's going to be good for our business. But also because if we do this, we're going to build a bunch of tooling and playbooks and knowledge that then is going to let us help everyone else make this transition. And so I think this is really what the USDC kind of announcement from him is indicative of. It's us trying to find kind of what are the the the steps we can take

• 42:04Speaker 00

  to move more and more parts of our business on-chain. And I think the the the thing that I'm really excited about is if you think about Coinbase today, you kind of think about it like a glacier. It's a massive company with so many things going on. And today, most of that on-chain stuff is like underwater. Like, it's not happening yet. And people are seeing the tip of the of the iceberg, where it's like, oh, USDC balances are starting to come on-chain. Awesome, like Coinbase is starting to let people do things on-chain on base and wallet. Awesome. But I think what's going to happen over the next year and change is like, that whole iceberg is going to rise out of the water. And it's like, oh, no. Every single part of Coinbase can come on chain.

• 42:43David Hoffman?

  Wow.

• 42:44Speaker 00

  All of our products, all of our users, all of our assets, they can move on to these new platforms where they're going to be cheaper, faster to build, globally available, composable with everything else, and better experiences for our customers. And I think that transformation will both blow people's minds. It will lead to a bunch of better products from Coinbase. It will accelerate the base ecosystem, and it will set the playbook for millions of other businesses around the world to make a similar transformation. And so that's what this is about. It's about showing the world that this is possible and showing our customers that it's not only possible, it's better.

• 43:20David Hoffman?

  USDC on base is definitely like the most proximate thing to put on-chain. It's like the first step, right? And you can only imagine where it could go from here. Is the idea here that Coinbase kind of unbundles itself as it discovers ways to put more of its own business logic on the actual chain?

• 43:41Speaker 00

  I don't know if unbundled is necessarily the right word, because I think some things, like users like bundled experiences, right? They don't want to have to go to a bunch of different places. I do think that as we move on-chain, we will find the obvious places where we can be decentralized and open source and bring in additional protocols to provide more value. But I do think we're going to try and move on-chain in a way that still lets users have a really consistent product experience. And one of the things I think is going to enable us to do this is this new smart wallet that I've talked a lot about and I think folks have been talking a lot about on the internet. The way I think about this smart wallet is that, like first we had to build base, which was kind of a developer platform where you could just like build applications. But even in that developer platform,

• 44:24Speaker 00

  you have all of these really, really hard problems for developers to solve. It's like, oh, well, how do you integrate the on-ramps? And like, how do you actually make the wallet experiences really good for users? Like, it's still super complex. The smart wallet is the next platform that we're building, which is it's going to sit on top of base and it's going to make it so both users and developers have an incredibly simple unified experience that lets them use all these applications. And so- Right now, every developer needs to worry about, okay, how do I get users to Bridge from L1 or other chains? How do I get users to OnRamp? Like, how do I do gas subsidies, all these things? In this new smart world, like, you don't worry about any of those things.

• 45:07Speaker 00

  The OnRamp's built in, the bridges are built in, you don't have to worry about multi-chain balances, you don't have to worry about the, kind of like, doing custom gas stuff, you can just use the Paymaster interfaces. You worry about building your application. And similarly, on the user side, it's like, you don't have to worry about moving your funds from Coinbase to your wallet, because you can just spend your Coinbase balance. It just works, right? You don't have to sit your friend down every time you onboard them and give them the talk about how if they mess up, they're gonna lose all their money. Because there are controls that are gonna be built into these wallets that make it so users can't lose all their money, just like with our existing tools, financial tools. And so, I really think that what's gonna happen over the next year is, we will have built this, like, underlying compute platform that let people build applications.

• 45:51Speaker 00

  And now, we're gonna build the, like, kind of next-level application tooling that lets developers build applications. And users are finally gonna have a front door that just works. And that will then allow us to build a bunch of first-party Coinbase products into that wallet and that wallet can access, but also let developers build a bunch of third-party products that are incredibly powerful and vibrant, that just work, because they have this new platform that lets users more easily use them.

• 46:18David Hoffman?

  I wanna, one thing I thought about when I read this tweet, and this might be me reading into just some tea leaves and projecting my desires and imagination, so Jesse, either corroborate me or pull me back into reality, but the idea that, just reading the line again, "This enables us to manage and secure customer funds with lower fees and faster settlement times." When I saw this tweet, I was thinking like, okay, like Coinbase centralized company, front end in the front, base in the back, right? Like, user accounts in the back. And to me, this has always been one of the visions of what it even means to, like, go on-chain in the first place, or why blockchains were even invented, right? Like, if we had the level of transparency of Coinbase using customer funds on-chain back in 2008, we wouldn't have had...

• 47:03David Hoffman?

  Such a crazy catastrophe of spaghetti messes of credit default swaps with no sort of accountability. Or like, and this is why courts had to step in because like, we don't know what the hell's going on. We don't know what contracts are being settled by who or who owns what. And so when I see a financial institution say, hey, we're going to use this like blockchain thing to manage customer funds. And it's all, oh, by the way, it's totally like public and open and permissionless and therefore user auditable. To me, I just see like 2008, like insurance, like a shield, a protection layer against any sort of like things that like motivated the creation of the space in the first place. That's at least what I'm projecting, I'm hoping is true.

• 47:43Speaker 00

  No, that's, that's exactly how I think about it too. I think like, I think one thing that is maybe, I think a lot of people have talked about like, oh, we can use blockchains for like proof of reserve by like putting attestations on the chain that everyone can see. And I think we may be like a little bit more galaxy brain than that. It's like, no, we don't need to do proof of reserve where we like take these off chain things and put them on chain as a representation. We just put it all on chain.

• 48:08David Hoffman?

  Put it on chain. DeFi is proof of reserves.

• 48:10Speaker 00

  Like DeFi is, it's the best proof of reserves you could ever ask for because your money is sitting on chain in a place you can audit and verify. There's no like, these systems go down and you don't have access. No, it's like, if the interface goes down, you go use another interface. Because it's on an open system that anyone can access. And I think-

• 48:29David Hoffman?

  Not to harp on Bitcoin here, but Bitcoin is a proof of reserve system because it doesn't have DeFi. That's why like proof of reserves came about is because like, that's, that's the best that it's got.

• 48:37Speaker 00

  That's the best that it's got. Yeah, yeah, yeah. So I, I think that is like definitely our mindset. It's like, we're just going to move it all on chain because if we move it all on chain, it is the open global economy that we want. It is an on-chain global economy that increases innovation, creativity and freedom. And it's, it's transparent, it's decentralized, it's all of those things that everyone's wanted. But it's just that we're building on this new platform. And there's so many things you can build on that new platform. I think it's gonna be pretty incredible. I don't think most people really grok what exactly this transformation means or how transformative it's going to be. And, and to like maybe push on that point a little bit further.

• 49:21Speaker 00

  Sometimes people are like, "Why do you have to do this at Coinbase? Isn't Coinbase a crypto company?" I'm like, "Yes, Coinbase is a crypto company." Coinbase started in 2012. Like, even the biggest crypto company in the world, that's the most crypto-forward public institution in the entire world, it still takes time, it still takes convincing, it still takes a lot of understanding and infrastructure to get to this kind of galaxy-brain perspective, which is, "We're gonna move it all on-chain." And that's still happening internally, it's still a process we're working through, but I think we're, every day, moving faster and faster and faster. And so, I think what will happen after we figure it out is like, the whole world is gonna figure it out, because they're gonna start to have these examples, they're gonna be like, "Oh my god, you're telling me I can have cheaper everything and more leverage

• 50:05Speaker 00

  for all my developers and be totally global and be transparent and open? Like, why wouldn't we build on-chain?" But it's gonna take time for that to settle in and to kind of percolate through every single part of the world that we know it today.

• 50:18Ryan Sean Adams?

  Jesse, some people see Coinbase being kind of a centralized exchange and a publicly-traded company, all of these things, and they look at Base, and so this is all being incubated and developed at Base, and they say, "Base is centralized." And so, what do you do with that criticism in general? And I don't know how you kind of look at that, maybe there's multiple ways to address it, but just the general concern that Base is centralized and it's not within a kind of crypto-decentralization ethos, what do you make of that?

• 50:47Speaker 00

  Yeah, it's a great question. And, you know, from the beginning, one of our values, I said earlier, has been decentralized and open source, and everything we've done has been in that direction. And there's a level of deliberateness that I think we need to bring to building an incredibly trusted place for people to grow their economy. And I think that deliberateness also means that we have to pace ourselves appropriately, we have to move really slowly, when that makes sense. And so, when I think about decentralizing Base, there's really two kind of tracks, there's kind of governance decentralization, and then there's technical decentralization. When we set up the network for mainnet, day one, we had certain requirements in terms of getting to what we considered a sufficient

• 51:32Speaker 00

  level of decentralization to let us keep base open and permissionless and global. And that was that there could be no single point of failure or single point of control that would be able to change arbitrary things about the network. Because if that existed, then there were a bunch of kind of knock-on effects from how regulators might look at this thing and how we could authentically position it and kind of talk about what we're building. And so from day one of base, that has not existed. There has not been a point of control that Coinbase has had as a single decision maker where we could change things. But there's definitely still components of the network that were more centralized versus decentralized.

• 52:16Speaker 00

  And so a couple of examples of this are when we first launched the network, the way the contracts could be upgraded required a two-of-two multi-sig, which actually went down to two much bigger multi-sigs, one managed by the Optimism Foundation, one managed by the Basecore team inside of Coinbase. And those big multi-sigs need to come together to make changes. That meant that Coinbase can't arbitrarily make changes, neither can the Optimism Foundation. We both need to, but it's still just two institutions. And so what we're working towards right now is expanding that to a security council that's geographically distributed, that has way more parties, that's been built in collaboration with Optimism, that's rolling out right now. And so that's going to remove one of the big points of failure, will further kind of

• 52:59Speaker 00

  remove those security council controls, decentralize it, et cetera. A second point of failure was that in the first version of the network, there were really only two people who had the ability to verify the chain on-chain and react if there were malicious behaviors by a sequencer, which Coinbase is running. That was Optimism Foundation again and Coinbase. It was one of two, so either of us could challenge some bad behavior from the sequencer. What we're working towards right now is launching fault proofs, which will make it so anyone can challenge. And that's on testnet right now. We just finished all of our audits, working towards a mainnet launch shortly. And so those two kind of...

• 53:41Speaker 00

  Major technical changes, I would say, are the next big focus for us from a technical decentralization perspective. They'll take us from stage zero to stage one in terms of kind of Vitalik's framework. And then we have a pretty clear path from stage one to stage two over the next year.

• 53:56Ryan Sean Adams?

  That's by the way, that's Vitalik's framework. It's also the framework on L2B, which puts some methodology to what decentralization actually means in layer two. And what you're talking about is like, there's a pie, or some people call it a pizza, with five different slices. And right now, on L2B, Base has two of those slices as green, the other three is red. And you're talking about getting to stage one of turning these all to yellow and green, yes?

• 54:22Speaker 00

  Yep, yep, that's exactly right. Yep. And we're making really good progress on that. So that's kind of the technical decentralization path. The second kind of decentralization path that I think about is more governance decentralization, which is in kind of that technical system that is the layer two rollup. There are certain points of governance decision making. For instance, like the role of kind of being that participant in the multi-sig, like who does that? Or like, setting the gas target, like who does that? Those are governance decentralization. And today, those governance decisions are made by the base core team at Coinbase. And over time, we want to expand who can participate in that governance decision making. And we're still working through exactly what this looks like, but we are committed to doing that. We're making good progress. And there's

• 55:07Speaker 00

  a bunch of ways that we can think about this. One of the things that I've been most excited about with Base is that because of our absence of a token and kind of this monolithic governance decision making structure that could be existing with a token, we've actually started to see a pretty incredible kind of bottoms up emergence of kind of these like cultural institutions, organizations, movements inside of Base that are starting to have real cultural weight. So this is things like Base Management, or Yellow Collective, or Base God, like all of these communities that people now look to as like, kind of flag bearers in Base. And one of the things I'm really excited about is exploring and experimenting with governance decision making.

• 55:51Speaker 00

  Models where we actually leverage those like kind of systems and those those cultural institutions to build meta governance that kind of aggregates their perspectives to get us to a great outcome. And so one example of us actually doing this really, I think, efficiently today, which we just did, is if you look at a lot of the like, one of the responsibilities of of governance has been like to allocate funding in the form of grants. I mean, mostly the way people have done that is they built processes that let people apply for grants and then kind of have built systems that evaluate them.

• 56:26Speaker 00

  And it's pretty expensive. It takes a lot of time. You have to like build all these systems. We, in the last couple of weeks, just launched this thing called Base Builds on Farcaster slash Base dash Builds. Every week, starting on Friday through Sunday, it's a weekend activity. You can go in there, you can post this week I built, and then say something you built. And every week, we've allocated two weeks of funding, although we'll probably scale that. And if you post in that, and then we've kind of defined on the on the back end a set of participants who can like and recast. And when they like and recast, it will basically upvote you. We'll then proportionally distribute that ETH to you. So we've basically built a kind of self-perpetuating system where builders are sharing what they built on-chain in a social format.

• 57:10Speaker 00

  You have a bunch of people who are organically liking and participating and engaging with it. That is then creating a feedback loop that lets us understand what are the most valuable things that are people building, and then we just put money in and fund those people. And that is us leveraging this organic kind of substrate of the base ecosystem to do something that previously governance would have had to do and do it in a decentralized way. And that's something that no one else is doing in the industry right now. And so it's been interesting to see how kind of some of the constraints, I think, that we've had have then led to us innovating and actually like opening up new ways of doing things that I think are more efficient, more effective, and getting us better outcomes.

• 57:47David Hoffman?

  It's also just interesting to see the flywheel of infrastructure that both Coinbase is using and also leveraging from third parties like Farcaster in order to facilitate growth and development, right? Like, there's some big flywheel going on here.

• 58:01Speaker 00

  Yeah, and that grant program, it's actually not run by us. It's run by this team called Rounds that came out of the Nouns ecosystem. They originally built Prop House, and this is kind of V2 of their product. And they've been running this for like, they've been running it as an experiment. And it's showing incredible results. Like, if you go to their Rounds page right now, this is the first week we had it. We had hundreds of submissions, and you look at the top 100, 200, they're all high quality. Like, literally every single one, and they're incredibly diverse. And our team, like, we didn't have to go through and manually review them. It leveraged our ecosystem to do that, to get us to a great outcome. It's incredible.

• 58:38David Hoffman?

  Well, I know it's always a good season to build on Base, but I think there's a season coming up specifically around summer, where maybe it's an especially good season to build on Base. Jesse, can you walk us through OnChain Summer Round 2? What is this initiative?

• 58:52Speaker 00

  Yeah, well, last summer, we did OnChain Summer. It was kind of our coming out. We think it's bigger than Base. It was really this moment where we want to start telling the story of OnChain to the world. And we saw like a pretty incredible response. So much energy of people just coming and building. And I think what that led us to do was make it so like, OnChain Summer is every summer. Like, from here on out, until the entire world is on-chain, we're going to be helping, supporting, and amplifying OnChain Summer.

• 59:19David Hoffman?

  Every single summer is its time to be on-chain?

• 59:21Speaker 00

  Every single summer. I mean, every season is a time to be on-chain, but particularly summer. I think there's just something about that energy of summer where it's like, you know, kids are on break. Like, let them out, let them build. Like, let all of us have some fun on the internet, on-chain. And so this summer, we're running it back. It's the whole summer, so beginning of June to the end of August, if you're in the northern hemisphere. If you're in the southern hemisphere, it's OnChain winter, and we're going to be doing some funny things related to that. We'll be making sure that there's a good meme there. But the whole summer, build incredible things on summer. We have, you know, I think like 600, 700 ETH worth of funding that's going to builders. More than $2 million. They'll support people building. We're running a month-long hackathon in June.

• 1:00:04Speaker 00

  That's going to be global, tons of incredible like partners who are helping us run that. We're going to be amplifying everything people build to as many people as humanly possible. You know, like, think getting millions of people in front of the app that you built. There's gonna be a ton of really cool brands and communities and products that are launching new things this summer. Coinbase is gonna be launching new things this summer. We're gonna be blanketing the airwaves as much as possible. And in general, we're just gonna be trying to bring the world on-chain. And last year, we brought millions of people on-chain. My hope is that this year, we bring tens of millions or hundreds of millions of people on-chain. And we're just gonna be pouring all of our energy into lifting up the builders who are making this happen.

• 1:00:43David Hoffman?

  So of course, Base wants builders. It wants devs. The devs here like grants and they understand what that what that means. But like, who's the marginal person who's curious, who's on the cusp of becoming on-chain?

• 1:00:56Speaker 00

  Yeah.

• 1:00:56David Hoffman?

  Or building on base, or just being an active base person? Who's the next most furthest out person that you're really trying to reach?

• 1:01:03Speaker 00

  Yeah, well, one thing that I think is really important, and we sometimes lose this in our messaging too, is when we say builder, we don't just mean devs. Like, developers is a subsection of builders for us. When we say builder, we mean anyone. Anyone can be a builder on base. You can build your brand. You can build your creative practice. You can build your business. You can build your application. You can build your identity. You can build your wealth. Like, literally every single thing you've done on off-chain, you can do on-chain, and it will be better. And so I think when we're thinking about on-chain summer, we're really excited about supporting developers and engineers and helping them build applications. But we're also really excited about helping all those other people

• 1:01:41Speaker 00

  find their home on-chain. And bring their vision of the world on-chain. And so we're gonna have coffee shops coming on-chain. We're gonna have pizza parlors coming on-chain. We're gonna have artists coming on-chain. We're gonna have small businesses coming on-chain to do payments. We're gonna have students coming on-chain. Like, literally every single part of the world, we wanna help get on-chain this summer. And we're gonna be putting a ton of resources into making that happen. And so if you are doing something on-chain, you are a builder. And you don't have to write code to be a builder. You can use any of the tools that exist that make it possible for you to create on-chain. And I think that's one of the really powerful things about what this next generation of the internet enables.

• 1:02:19David Hoffman?

  Is there ever a world where Base as an org spins out and becomes independent from Coinbase? Is there ever a chance that you guys just want your independence and splits?

• 1:02:29Speaker 00

  Yeah, I mean, I think when we talk about governance decentralization and technical decentralization, we are looking at all the options. And we've said from the beginning that Base is incubated by Coinbase and we're decentralizing over time. And so we don't know exactly what that looks like. But I will say that today, the Base team operates with independence inside of Coinbase. I report to Brian, you know, I have my own budget and P and L. And I basically operate as kind of like CEO of the Base Labs team. And we execute on what we think is highest priority for growing the Base ecosystem and then collaborate with the rest of the business really closely. And I think that level of independence and trust and support and autonomy and really the feeling that we are being incubated by Coinbase is what's enabled Base to be Base.

• 1:03:12Speaker 00

  And so I think that the best versions of these things are going to be the decentralized versions of these things. We can't build an open global on-chain economy without decentralization. And I expect that we will continue leaning into that over the next couple of years.

• 1:03:25Ryan Sean Adams?

  So Jesse, this has been great. And as we close this out, I think you've been a key to inceptioning this meme, "on-chain is the new online," which I really like because it compares on-chain to the internet in a way that is, you know, like hearkens back to the 90s and everyone's very excited about that. It also gives us a way to sort of measure our progress, right? And if you think about the bankless journey or the crypto journey in general, it's about doing more and more on-chain over time. So I want to end this episode with the question we sort of started with, kind of the, how far along are we in this whole journey? And maybe put you on the spot and ask you this question. You said, you called out a number, you said a billion people on-chain. Okay, how long is that going to take? When are we going to achieve that?

• 1:04:06Speaker 00

  Yeah, well, I'm an optimist and so I'm always a little bit too optimistic, I would say, on timelines. But I think that this is the decade of the world moving on-chain. And I think that we're going to see it faster than people anticipate. And so I don't know whether it will be in the next one to two years, the next three to five years. But I really do believe that this is the decade where we'll see it happen. And by the end of the decade, the whole world's going to be on-chain.

• 1:04:27Ryan Sean Adams?

  By the end of the decade, the whole world is going to be on-chain. Onchain, Jesse, thanks so much for joining us on Bankless. This has been a blast. Thanks for having me, guys. Appreciate it. Bankless Nation, some links in the show notes. We'll include a link where you can find out more about Onchain Summer, the second edition, the summer that never ends. And of course, got to remind you with this, crypto is risky. Going onchain is risky. You could lose what you put in, but my God, it's so fun. 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. I love it.