Exploring a New Nexus: Cosmos & Ethereum - Kent Barton

okay up next um we've been having a hard time finding our next speaker i don't know where he is we've been so if anybody's seen kent barton from shapeshift let us know oh hey john oh hey fancy seeing you here how's it going wow that was weird yeah far out so uh it's uh we're going to be exploring a new nexus with kent and i'm actually going to be uh passing the baton here um to him for mc duties as well so he's gonna i'm gonna do the intro and he's gonna do the outro so i'm gonna help him get to this part of it set up hope everybody's doing good today can you believe we have multiple days more of content is crazy okay have fun everybody thanks john all right so we'll get kicked off here so yeah i'm kent um along with uh being a steward here at east denver i head up the r d team shapeshift um and today we have such a cool theme uh this morning with all the talks interoperability um you know it's this this area where it's it's kind of novel nobody's really sure how exactly it's going to play out but clearly there's a ton of interesting and awesome developments so let me just get this cued up here cool so uh yeah my focus today is going to be on the nexus of cosmos and ethereum specifically um you know we've seen a lot of talk about cross chain bridges with different protocols cosmos is one that is uh going to be interacting with ethereum a lot in the in the near term i think and i think there's a lot of cool opportunities there across both ecosystems so this briefly what we'll cover uh you know what is cosmos and why it's scalable a little overview for those who are quite familiar with cosmos uh how does this uh differ from layer two platforms um what is ibc briefly uh bridges between cosmos and ethereum how does that work what potential use cases might arise from cosmos and eth so my general thesis here is as follows ibc-enabled cosmos zones including cross-chain bridges can effectively serve as trust minimize a trust minimized scalability layer for a thief leading to positive some interactions across the two ecosystems i think that's a key distinction uh you know the zero-sum fallacy is so prevalent in uh in ethereum and uh pardon the noise i think there's somebody vacuuming above me i think ripple sent them anyway um the uh you know there's gonna be this positive some kind of game uh so kind of just briefly i i want to preface all this with um my own experience and kind of how how i got into learning more about cosmos i'm an ethereum native was fortunate to kind of watch the the community grow up in the ecosystem over the years but learning about um cosmos at shapeshift was quite an interesting experience so at shapeshift over the past two years we contributed to a uh open source platform uh open source cosmos-based blockchain called microtic microtic is a decentralized short-term options uh marketplace that also provides a trust minimized price oracle so this necessitated some important tech requirements uh namely fast finality and multi-party computation uh originally the thought was that we could put this on ethereum but you know then crypto kitties happened we realized it's just it you know the main net clearly not not feasible we also vetted layer twos uh at the time and um crucially they you know they lacked that ability to provide fast finality and um uh multi-party computation um one thing i want to stress here and this is super important is uh you know the layer zero the the community um this this can't be uh overstated i i really strongly feel that the cosmos community is very similar to how you know the community was three or four years ago there's a commitment to the ethos of decentralization and credible neutrality there there's not a a rush to move into uh you know hot over hyped things um and there's a really commitment to building things that get along with each other um and i think this really uh you know this manifests itself in seeing this um sort of explosion of different projects in the space but really i see some strong ethos alignment between the two communities uh pardon me real quick i don't have my comments uh up here i just want to check slack and make sure everything is going well from a tech perspective okay it looks like nothing's on fire um so against this backdrop of cool innovation or cool community uh you know we have kind of interesting things going on in a cross chain perspective so again what what is cosmos in a nutshell um you know for a consensus we have tendermint bft at this point it's safe to say that uh tendermint has a little bit of the lindy effect going on um it's been about two years um i think all going on two years of uh providing consensus for the cosmos hub um i believe it's had excellent uptime um and you know it's really kind of been proven out tendermint seems to work uh in cosmos you have self-sovereign blockchains these are zones instead of the shared security paradigm um and then you have uh you know a unique validator set per dapper per zone so you know this differs from uh difference from polka dot differs from eath 2.0 um it's an interesting um set of trade-offs that it's entailed it does seem to be working for a lot of different projects so far uh it separates the application and consensus layers uh which if you talk to devs have some has some serious benefits it also imparts some scaling advantages and of course we also have this hub and spoke model for connecting zones in this cosmos of crazy applications um so as part of this uh you know uh we have ibc uh inner blockchain communication protocol and this is what allows cosmos zones to talk to one another a zone is just basically a blockchain in the cosmos space ibc is rolling out imminently but in the context of this talk what's interesting is it also facilitates uh bridges to other blockchains so um you know it's it's sort of always been part of the the cosmos vision that there could be uh bridges into other environments um and uh this is kind of what's happening now the reason you haven't seen um a lot of this implementation yet is that ibc itself is just rolling out after a lot of testing okay so getting into the nitty-gritty of um you know what what cosmos uh or how it interacts with ethereum this is where we get a little bit more more techy and this is an area that's likely to evolve pretty quickly over the coming months as uh ibc really rolls out and these these things are developed on uh this this was formerly called peggy i believe it's called gravity now uh jack zamplin was kind enough to provide me with some some details on kind of more uh granularly how how this bridge will work so essentially you have a validator on cosmos it starts with an eth key the eth contract is controlled by a weighted multi-sig of those keys which is updated when the cosmos validator changes that sort of ensures that the cosmos validator set is always matching the east signer set it's a clever implementation i think when funds are deposited into gravity an event fires and that's related to gravity and then you have a minting of the the corresponding token on the cosmos side of things and then if you're looking to go the other way the validator set sends an eth message which could be relayed back over to the atheism blockchain and there's some economic incentives there to um encourage the the relayer to uh to do this um if you guys want to want more details definitely follow jack on twitter he's been working on on the bridge uh quite a a lot in recent months um and i think we're going to start seeing a lot of interesting projects emerge that are are bridging the two ecosystems so what can we what can we make of this um i like what does it really mean if you're if you're you know potentially a cosmos developer or youth developer or maybe just a user um i think a few takeaways can be gleaned from like user stories so you know here's one user story i think is likely to emerge i want to use a cosmos zone to do cool that's not currently feasible on a layer two platform uh the the micro tick example i provided earlier is a is a prime example of that it requires fast finality multi-party computation it's just not something that's doable on um on ether or layer 2 at the moment so something unique on that layer too or on a cosmos zone on the other hand you know i i'd rather you know keep things mainly over on the ethereum main net this is currently where where the lion's share of the action is in d5 um and over there i can also count on the robust shared security of the ethereum chain which has been you know very solid and has this wonderful high hash power behind it and eventually staking um so in if you're that that person you can imagine a flow something like okay i'm going to use a trust minimized bridge to peg my die we'll say die in this case over to cosmos so we have a cosmos variant of dye i'll use the cosmos die on the zone to do cool and unique things of course at a steep discount in terms of transactions much like a layer two so we're very similar to layer two in that sense um and then when you're done bounce back over to uh to die on the ethereum chain uh in a quick insecure fashion in this sense it really sort of is like an ethereum side chain i know that you know people will get into the um the specifics um or the distinction between side chains and layer two um but so perhaps you could say it's a side chain because we're we're not actually using uh the ethereum main chain to help uh you know for data availability in this case or anything like that uh just that contract over on the um on the ethereum main net but effectively you're enjoying some scaling properties here uh here's another user story and one that it takes maybe a little bit more imagination right now but i would i would guess in 6 to 12 months we're going to see a ton of dapps that are um that are doing this sort of thing um and that's specifically okay i'm building an ethereum based dapp but uh man there's some cool functionality over on cosmos that i would love to employ and introduce in um in my depth oracle data is a perfect example uh microtic and other projects as well could it could generate data on cosmos by virtue of their um you know say fast melody something that they couldn't be easily done on the ethereum chain that data exists over in cosmos but thanks to trustless bridges it could be brought into the uh the ethereum space so that the userful in this case use a trust minimize bridge as a ibc data layer to bring information from the cosmos world into your dap and let me see how i'm doing on time cool we are a minute all right we'll fly through the rest so what does this mean and this is where it gets really freaking cool i think is this kind of introduces the uh the concept of cross-chain tech stacks where you know we're building grabbing components from different stacks and because we have trustless bridges uh with not just token transfers but just it could be any arbitrary data i think we'll see this rolling out so i think that the key thought here is you you know really think bigger there's a lot that you could do um if you're feeling limited just working in one of these ecosystems you know branch out we're gonna we're merging into a world where things will not be siloed in one chain and and that fact will be beneficial for for uh users uh of all of all uh colors and types across all the spaces fly the five the east flag fly the cosmos flag it's great um really briefly challenges okay tech tech risk ibc and uh bridges like gravity are new and unproven so of course there's you know there's gonna be some risk until uh those are proven out in a production context friction um there's some difficulty spinning up a validator set however um you know zones have certainly been successful in doing that uh lazy ledger may be able to help uh security of course this is a big one um is the security of the zone as good as the shared security of eth i mean probably not but it's getting some of these do have very good security sets and they're uh it's getting better over time um and liquidity can new zones quickly gain a critical mass that's an issue although looking at projects like mir protocol and terra there seems to be a lot of d5 already happening on cosmos so that's it