Fireside Chat With Tomasz Stanczak and Kartik Talwar

With this, we are ready for our last and final fireside chat and talk and session for the day. So, without further ado, please welcome Tomas, the co-director of the Therm Foundation. [applause]

Hi, everyone. All right, this is uh our fourth one this year, I think. Um and I think the best part of all these things is that you know what this ends up being a good how things are going process. This is like a public standup from my perspective. Um or today's Thursday and uh dev connects going on for 4 days.

Two more days to go but I think it's it's very much uh ending uh in in uh 48 hours. Uh my first question to you is how do you think this week has been?

Yeah sure. So um interestingly because this this event feels like there's it's so much about Ethereum so there are so many great Ethereum people here it's comparing to all the other efforts of mine of visiting other locations it feels like I'm I'm I'm really not that busy like so sure I have lots of meetings and timewise sure I have all my schedule packed but I don't feel overwhelmed like that I'm swarming you hundreds of people who like to talk to me and so on. I'm not that much center of attention and it helps me a lot. Uh and it's because this is celebration of that many different teams and it definitely shows a proper decentralization if I can just just walk and pass and be be relaxed. Um observing everything obviously I will always have without anonymous surveys I will have only the positive feedback because people come to me and say yeah it's it's great.

But um I think generally I feel that the vibe is great. My my personal impression was the city is beautiful. It's uh it's part of the success of any conference is that the weather is good, the city is nice, that you can get nice coffee and lunch uh outside of the venue and it's not exactly something that you do by by organizing and by choosing well of where where people want you to be and uh and it seems that the great success is the attendance in the end. I was very worried few

what's the number 16,000 or higher? It's more. I think it was around 18,000 and probably they were still counting. So it might be nearly 20,000 people. Uh I've heard that it's a big impact on the local economy.

A really big impact. Positive impact.

It's a measurable impact. Yeah. You just had three block radius.

Yeah. Palmo Palmo will be all skyscrapers here. So New York prices for hotels and then numbers available for anybody else.

Oh yeah. Last day started. I hope you were not affected. That's right. We we counted the the hotel spaces before choosing the cities.

So um yeah, I think great atmosphere and also surprising I would say the markets are not the best but people had good moods and didn't complain and uh wi Wi-Fi was broken but people very often told me like oh Wi-Fi is broken but it's okay. It's like really I didn't hear complaints. I'm waiting for this anonymous surveys of everyone saying

I feel like there's some uh some bias in there cuz you can't finish the survey without proper Wi-Fi. So, you know, you kind of win on some but uh I I actually agree. I was I've been there every day until yesterday. the first three days and now surprisingly it's one of those things where you actually see real life improve from the fact that ultimately like people care about community over over most things and price is not the determining factor neither is fully functioning Wi-Fi. Um but people are seeing each other for the first time and they're seeing each other from all different across the world.

And as youthful I I also have a you know a sampling bias here because I get to go to all these events. I exist the same people but most people don't travel everywhere. They don't travel to all the events. So this is kind of the event for them. You can see that represented by the near 20,000 attendance.

Um and it kind of kind of really brings out those memories of hey this is why we're here and this is the progress we've made. Um, and thank you for the fact that I saw that firsthand. Um, I've had today a feedback from some people saying, "Argentas are so great." Which means that people came here, met a few Argentinians. These Argentinians are great.

Uh,

and I also think you had a massive surge in locals attending too.

Oh yeah. Yeah.

Yeah. It was not just people coming from outside and that number is not just tourists. I think it generated enough hype that some people started buying tickets thinking oh what it is what it is and then joining which which is definitely super positive uh outcome and on on Tuesday I think we had this super sunny wellp packed well programmed day when it was uh record attendance ever on any devcon dev connect day okay

on Tuesday the most people in single day uh at the venue site and the venue site still was it could uh it could have like 10 times more people venue is

actually I heard that it can support like 100,000 people or so and

so I'm really worried that it will be feeling super empty and I think it felt spacious in the end. uh sometimes maybe that was uh a bad outcome but most of the time for people it definitely didn't create too much stress so people may be relaxed after the year and and made a lot of connections probably by now I imagine people are making friends and are planning their weekends together or maybe some local trips and that would be great

um maybe a few more things so um kind of curious about different other parts of this week um we obviously had a lot of companies announce different products and a lot of them got spotlight. Uh, one other thing I'm curious about is knowing how you thought the welfare went and um, do you think that was a a good thing, positive thing? Did it make a good impact especially all the companies you brought together for different categories? What kind of was has been the reaction from then talking about the world? uh yeah you know because I was al always working in uh infrastructure side core development side and then this year when I was collecting feedback everyone was saying make it more about applications and I I was worried because I felt I'm myself infrastructure person I hear this feedback so now my responsibility is to make things about applications how do I do that and um world for idea came from uh from the defcon team fantastic work from them but but And still after they announced we'll make it about applications after I told them yes that's great we have to make it about applications uh the EF started uh planning some of the events and I I I saw in scheduling few months ago like oh the research day or the intra day or the L2 interrupt day and and and it was a bit like guacamole closing some of those efforts and saying no change it to defi change it to AI applications change it to this change it to gaming I want gaming And it means that we had to push.

But you felt and you already like I feel like a month or two months before we started feeling that in Ethereum we talk more and more about applications because more and more applications were noticed and they knew that they will be there and and they started retweeting their attendance which means that probably every single person who attended def connect learned about a lot of applications this time. So I think that I uh I I definitely felt that walking around. I myself was thinking, oh, so many applications. Actually,

I was going to say too, like the fact that the defy the payments section was like the biggest one showed actually the biggest version of people actually saying, "Hey, this is an actual app that's working." And by the way, we have like anywhere from hundreds of thousands of users to millions of users and you can use it and it's just not a protocol pitch waiting to happen that would have someone integrating the future. Um and I kind of saw that firsthand which is why people are excited about seeing products not protocols. Um and I think um the app did a really good job with that. So I hope that trend continues.

Yeah. Lots of lots of payments applications but also u when I was talking to some of the founders uh is the first time when I was really listening to to pitches of the applications at Ethereum and everyone was starting by how many users they have and I like oh we have half a million users. Oh, you have this like few thousand users and see like and you know normally people would say about the vision the number

we've been here before years ago and we know that was a much different pitch.

Yeah. So that's is great.

You hear in exactly the way you want to hear. They say we have like a million users and most of them in Philippines and Kenya

especially an American user base

and it's repeated uh well yeah like Latin America as well like Brazil, Argentina and they mentioned Colombia and there is lots of interest in Latin America from from Asian companies. So they wanted to see how to integrate with with pigs with Marcata Pago with the merchants here. Um, so there's definitely space to observe the change happening and the real usage and people maybe downloaded a few apps hopefully and and use them. So nice. Um coming back to kind of generally how I would say you representing ES now um thought about this week.

Were there any takeaways for what you need to focus on or maybe some of the the proof points that you got on this is what you thought were priorities should have been but the feedback from people implies that you may need to like think about moving certain things in different order like have the priorities that you've set with the EF are still the same or has the debt changed any of the orders?

I I think that no like people are happy to be talking about UX and scaling. Um they were asking about applications. We we had this kind of the side quest very important one about trillion dollar security which we talked about since May June this year and it was not mentioned as a protocol focus but we talked about security and it got a lot of attention. I've seen that uh the companies that deal with uh like larger institutional DeFi with security themselves really picked that track and really cared about it and and we have the traction and it's very important talk about security and have some some framework for it. It's great.

Um for next year I was I started like three months ago I started testing on different talks different focus areas for next year and mostly I got rejection. people want to continue with scaling and

what are the what are the items that got rejected? This is interesting. Uh so we wanted to bring like the uh like security and um and privacy I think to the main focus areas and and before when we were choosing the scaling L1 scaling L2 and interopen UX many people said no you have to talk about privacy and security like so internally at the EF and and our defense and the protocol team on on the feedback was that no this is what we always talk about and we should teach people that this is this is the basics. You never have to make it focus area because it's your by default focus area. But then

when you say focus area is this a what's important or is it what's important on the engineering side for protocol they releases. So the way we define focus areas is we we choose three focus areas for the year and then we choose the like the track leads for this focus areas in the protocol cluster of Ethereum foundation and there's 100 people and then we say that for the entire cluster for all the 100 people I think we said 90% of your work has to be uh assigned to one of those three focus areas and that happened in May. So every single team whether it was research or engineering they got together and whatever they worked on they had to justify the 90% of these aren't those areas

is there. So, so that's where

that's a really good way to think about it because you still give them enough flex time to experiment with everything else but just like a clear measure of living but it's 10%. I think before you had something like 60% time for experimentation at the F or kind of there was no focus area so people sometimes were overlapping if it happened to be that they thought about the same thing and I wasn't sure how much it will affect the work of the year but then after in October I was talking to some very heavy research teams and they were saying like teams that would normally think about long-term issuance long-term new auction mechanism and so on and they were telling me oh we were working on the repricing mechanism for scaling then I thought oh that works actually this is that simple um so I'm not sure how much how much they felt like they were constrained but it feels that they enjoy this process and they enjoy the fact that they deliver that and everyone says that it's so cool and they felt like they're all part of those big deliveries and impacted positively people as for outside of the the feedback on the focus areas I think it's okay I think we we felt properly properly aggregated what people wanted. Particularly scaling L1 gets a lot of support. Many people reject the L2 uh preference, right? So like I think that's what I hear quite often for L2s.

Yes. So I guess I'll do two follow questions here. So we'll start with the L2 one. I'll go to the L1. um what is kind of the upto-date refined version of what the L2 focus means for for the F what would you like the airs to do or how do you think their places in this ecosystem

so the way I approach L2s and this is like not my invention after many conversations for sure there's some some predition of mine is that we set the L2 road map so we have to deliver L1 as a platform for L2 to thrive. And what I want to do is that even if L2 announces that it wants to become L1, even then we support it. And because we have to be so confident that even if someone wants to it will be so like kind of bad but not bad that someone will tell block shame but bad because they will lose so much value of being an O2 that they will not do that that even if they announce it and they set it as a goal they will not do that because actually it will not be economical for them. So then I think uh every time when someone was coming and saying oh but this L2 wants to become an L1 I was saying that's okay and and it's changed the attitude because it gave much more uh much more confidence to everyone working on L1 that they don't have to worry all the time about the L2's leaving and and and that helped but some people from from like the edges of the community they consistently do fear that and they didn't get that message maybe that That's okay because we always have those that will stay and they will actually continue winning over whoever the facts

when you're you're also getting inflow from the other side which is I've seen L1's become L2s and there's a lot of conversations um fantastic fantastic before they've seen uh they show the today I've seen their charts on the revenue they talk about the active users the innovation they have already put uh massive lot of distribution. So success since they moved a lot.

When people ask you why should somebody create an L2 or like what are the kind of reasons why an L2 is considering becoming L1 is there a guidance around like what you think the L2 should do and and their role in the settlement part of being on top of Ethereum. Um yeah so for for me the role is delivery the throughput capacity innovation and a bit of branding and fashion. So when people say that Ethereum may struggle for attracting new generation, I think that like like being super attractive for the new generation is a bit of a fashion like they if you have branding, you have a logo, if you have a name and if you start seeing people that go through generations and maybe uh now we're with kids and thinking about other things that the new generation thinks we want to build something of our own and sure we want to propose the Ethereum and something of their own and and it is generally designed like this but I think that many of the O2s can deliver also that aspect of we speak a different language different branding so we attract the new generation of developers because they feel this is cool place so this is one thing that that very rarely is being talked about the two

but we know that works the specific

but we know this works even right now because it's actually one pitches it's just another EVM machine in those cases Most alo ones are just another EVM instance of the same P node but with different rendering, right? We know this pattern works.

Um, yeah, I didn't hear you. So, yeah, but I think it works. I think it works assuming what you said. [laughter]

Yes, that's exactly what I said.

It worked. Everything works actually. So, we we've heard uh Stani saying that DeFi wins. Uh we've heard people saying Ethereum wins. uh L2s are great, L2 is winning.

So that's the role to to keep winning together. Uh that's the role that I see. I keep saying that L1 is there for uh high value settlement for keeping very large amounts of assets on a one for minting assets initially on L1 and um and I think that we are really in agreement between designers of the network nowadays and institutions. surprising this where our allies are because they say decentralize and deliver security and that's the L1 role and we feel very confident about that progressive L1 role as getting even more assets while L2s accelerate and and and do ZK they scale they talk about branding they deliver new uh new user apps uh but then always they have to be ancore to one so they what they get from being in one is Um most obviously they have massive savings from the security budget and I keep forgetting about that but then uh even as I start telling people oh you know you'll get those synergies from the support from the ecosystem and you scale and you get security and assets but they tell me oh yeah but we were thinking about it that that generally it's massive savings

like yeah spend millions of dollars. Yeah,

millions of dollars. Um, and particularly when you think about treasuries of the L2s that very often are are having huge exposure to their own tokens and then very often they are locked or they limited in in how many of these tokens they can push to the to the market to finance the the activity. give the

sentiment matters they issue the reports uh to someone who treats it as as the revenue for being validator uh the the L1's right alternative all so this all goes very often to the market immediately because the the validators or the operators are are hedging their their operations

and then it means that the the foundations behind those all once are really blocked in funding their activities and it kills them so so that's makes them think of oh actually it's better to build two and I I keep start talking about L2 premium soon. I hope

um we have a couple more minutes. I want to actually hear a little bit more about some of the outcomes from the few initiatives I've heard that have started. So there's now an initiative around talking to financial institutions. Um you had a a set of kind of people at the EF now that are talking to founders in the space and there's also more on policy making. So like maybe quickly on each of these how are things going and kind of what is the the goal and how would you measure if things are making progress?

Um yeah so the ecosystem development institutions and so on we we measure mostly like tbl stable coins rwxyz website and and these are numbers and we say look in the end anybody cannot single-handedly affect that number directly but if you track this number every day then you learn the rhythm heartbeat of this number and start to build some kind of intuition and pattern matching on what makes this number go up like radically percentage the market share of Ethereum L1 and Ethereum ecosystem in the global RWAS markets or stable coins. So this is what we track on talking to institutions uh policy conversations explaining things to regulators to institutions educational content there as well. Uh then on the trillion dollar security um I don't know really what metric did they pick. Um I guess the the amount of money lost to the to the hacks would be would be one inverse metric.

Yeah

sure it's very volatile and and it's hard to track like you won't get feedback from that over over months. Um but this is what we should minimize. So, so this is one metric and I like we we just hired a coordinator there and there will be more grants and we're going through the budgeting process. So hopefully they got more budget for the trillion dollar security. Um for next year there'll be some some initiatives around some of the uh communities like probably um Asia, greater China and and southern America.

Um the other focus area for next year uh there's plenty. continuation of protocol uh efforts and yeah what what else did you ask about

uh I was just kind of curious about some of the initial term founder engagements founder engagements yeah so policy it's operational so um some people that joined the ecosystem development teams they have what massive following on the social media and they really made an impact and they created that um influencer field that should attract a lot of people that want that feel of cool. So I'm I'm thinking of uh people like Abas Leo Jason and say uh and obviously Benji they they speak really cool language of they understand what's message to deliver and how to talk and how do we

and others approach them which is even more proof right they people come and reach out to them and talk to them and give feedback and I've heard that cycle start

so I hear a lot of founders saying it's much better now we we we are headed we have opportunities And we, it's funny, we stopped giving them money actually entirely. I cut the budgets for the for the budgets, fin like financial budgets almost to zero. So we stopped giving them money. We just started giving them attention and connections and they coming and they say it's much better. So So it works.

It works.

Social capital is real most likely.

And because I think it's so much more valuable what we're doing now. like you can give $3,000 or you can give uh like tens of hours of attention and mentorship of people that's that datically charge more more if they were in the open market so you get much more value. I think that's what we're giving now.

Amazing. Well, my final question before we end today is uh maybe more specifically what are the priorities for the foundation for the next year?

Yeah, continuation most mostly continuation. So activate like more communities like we'll see we'll be announcing the uh defcon soon probably on Saturday and uh so this will be huge priority and building around that location the priority of activating entire region um then uh probably institutions bank will be already finalizing by maybe June next year that we'll have all the programs running and people know what Ctherum is and how to build it and we'll see massive impact of the effort from the last last months maintained uh privacy and security and continuation of scaling and uh finality will be one focus area that maybe comes to protocol space. So we'll talk about this fast confirmation rules finality maybe short slot times uh and then all core devs will choose things and tell us what we have to care about and the ecosystem will maybe do their budgeting and their general reviews and they'll tell us this is what we care about now and we'll learn from the ecosystem what our priorities are. So be reactive.

It sounds like a pretty busy year. So

yes, it should be.

This is this is awesome. Well, Timas, thank you so much for this amazing chat. Please give him a round of applause.