[Music] We're going to kick off with our very first session and for this one like to bring on Tomas on stage to uh get us started on the future of the Ethereum protocol. Please give him a round of applause. [Applause] Hi everyone, thank you for having me. It's always a pleasure to have you because uh we get to uh have a very candid conversation on things and uh the part that I like the most about chatting with you Tomas is that you uh you are comfortable giving an answer that may not be fully complete or fully thought through and you're kind of sharing your thinking as you go along and uh that's what makes this more fun.
I think that uh your questions always start new topics that later I refine for the podcast. So like Cardics makes me think about the new things. he he really have the feel of uh what's the next question that everyone will be asking in the community.
I I'll take it. Um I want to start off by asking a question that I feel like anytime you're going to be on here I'm going to ask which is what are the current priorities of the Ether the Foundation.
Yeah. So there there are a few things that that we've been working on in the last few weeks. So one thing is to make sure that Dev Connect is great. Uh so Dev Connect in Argentina in November. I hope that many of you will will go there and will meet with the fantastic Argentinian community and observe how how actually you can uh how actually blockchain can introduce changes I guess on the many layers of the society.
Argentina is a special place for for this for the history of adoption of blockchain. Uh the other thing is I think now we already see the traction with talking to enterprises showing the adoption among financial institutions. So maybe from the Ethereum foundation perspective we we are set up and we we just now continue executing rather than pay full attention to to introduce new uh new concepts here. So the the events are happening. We are in New York.
We have the enterprise team uh they they have hundreds of calls. We are responding to questions coming from institutions and and I think that we see there's lots of interest. What I've learned in the last days, people said, "Look, even through the treasury companies, many of the people in the institutional space, they they look at those and this is a big thing on the public listing side and then they start asking questions about Ethereum because they want to understand what's that thing and then they go deeper and deeper asking questions about technology." So, it's amazing. I think we'll have a lot of uh a lot of new entrance and we'll start thinking or maybe I can also build uh large companies in the space.
This is like a a big new thing of connecting the the stable coins, the payments, the enterprise. Um the attention would be also of thinking about what's what's coming next after the focus until probably the March of delivering Fusaka and Glamsterdam on time. So this is a lot of
so maybe to backfill for for people in the audience uh the next upgrade is going to be Faka
Fusaka and it's planned for November early November.
And what's part of that upgrade in November?
Uh so the headliner is bearded us. So it's focusing on the um on the L2 scaling. So the scaling of the blobs. Uh it's part of this three focus areas of scaling L1 mainet which is mostly improving the performance of the clients L1 clients but also introducing some of the smaller AIPs that will support further uh further scaling. Then uh then yeah like next to next to beard is scaling over two there is also a handful of other EIPs that improve the preparation for interpretability UX and uh and various aspects.
So there's like around 10 EIPs and the forecast.org is the is the website that uh shows nowadays the detailed breakdown of all the EIPs.
Amazing. um if if you were to um observe the network the day after the release goes live uh with pure what is the net difference that you're going to see in the scalability of blobs or kind of the L2 communications here.
Um so I think it will be coming a bit ahead of time which will be very nice to see. So when we seen the pectra coming and the the blob count increasing the network only nowadays catches up with the with the usage of blobs. So what matters is that many of the decisions of the L2s of the enterprises launching on top of Ethereum are based on their projections expectations for the next few years. those they will see do I have some credible commitment from the Ethereum ecosystem that if I build on top of Ethereum that it will continue scaling to uh to support the requirements of the network that I want to launch so pectra was the first signal that we're going there that we increase the the number of blobs and fusaka should be even stronger signal that we committing to that for example there will be this uh simple improvement of making the blob count increases to to to possibly happen as a parameter change as an agreement between the clients and the not that we can change it easily in the future quickly.
Yeah, because otherwise you would have to change it via uh via hard work sorry network upgrade hard fork.
So that's just in November. Um if you were to kind of zoom out and say like what does the next 12 month look like for Ethereum the layer 1, what's kind of on the on the docks
the next four one year 12 months?
Yeah, sure. Sure. Uh so I think that one of the biggest things will be the progress of ZKVMs. Uh so the amazing work from from Kev, from Sophia, from the teams at Ethereum Foundation and then really even more amazing work from all the teams that that have been working on ZKVMs for the last few years. Uh so you see Brisk Zero, you have ZISK, you have succinct, you have uh OpenVM and so on so on.
And uh so we we focusing on their latest improvements in this real-time proving and delivering like fundaments for scaling L1 all the way to few hundred million gas in the L1 blocks and this should be coming over the next four months where we see a bit of like the the sidecar prover uh prover presentation and something that will come for dev connect. So
so help me understand that a bit. So you you named a lot of independent initiatives that are doing this.
How does that get baked into layer one? They're going to be given kind of priority access to effectively verify and merge generate proofs faster or there's going to be a competing implementation on the Ethereum chain for what everybody else is doing. uh so we we found baked into protocol incentivization there'll be some uh some validators that will be running uh provers on the side to to show that it can deliver that like the the the exact mechanism like it's it's still being probably designed or simply I cannot explain to you in details uh but it will not be in the protocol it will be some of the validators running and showing that they can prove and ourselves like testing and operating together with the ZKVM operators so so they have this target goal for November that if they deliver the solutions, they'll have support from the foundation to to showcase particular requirements. So this is under 10 kilowatts of the power available and less than $100,000 of uh capital expenditure. Uh so we can show that you can really run the provers for validators uh and more like home setup.
Obviously, it's like a high net worth home setup like it's $100,000 or at least some independent companies can operate the provers cheaper than setting up a mining operation which in comparison
and even the validator nowadays when you think about it it's 32 E right so it's it's much more than that
amazing um just on the same topic maybe just a very quick answer we don't have to um give too much context into this but with the next two upgrades going on we know that there are going to be incredible scaling achievements that cannot become possible. What's kind of the net difference in the throughput that we get to uh to see whether it's on gas or just transactions per second? What?
Yeah, we went from 30 to 46 million and then we jumped to 45 million. So, it's like 50% more than at the beginning of the year. uh we target 100 million through the improvements of the clients with some minor EIPs like uh like supporting paralization supporting the uh supporting the edge conditions where like one or two op codes were a bit mispriced. So this would have like 3x improvement over a year since since uh January and then when we talk about ZKVMs this is our path to something like 300 million gas. So this will be 10x over the what we've seen in January uh this year.
That that's a big amazing. So if somebody's looking to build an app next year,
they have a credible kind of choice between building directly on Ethereum layer 1 or picking a layer 2. Is that a fair fair statement or how should somebody think about this next summer?
Yeah, I'll continue saying that it depends on the application. So you have some applications that will think it's a bit like retail thinking whether they want to open open store in Manhattan or somewhere else. So like the chain of stores and then you you open one store in Manhattan just to claim everywhere around the world that you that you anchored in Manhattan and like you know like in 50 headquarters. Um yeah like so there is there is lots of prestige and for sure it will be always a bit more expensive to uh to deploy on L1 and if you open something like very high value NFTTS or very uh like very prestigious branches of your financial services like you say okay we'll operate in DeFi but we want to show that uh you can execute operations and one so we start from there and then we operate in the entire world. So for the high high throughput low latency transactions you'll go to 2022s and they'll be maybe more original or maybe like really uh city scale with uh like if if you want to go for five to 25 milliseconds latencies for the blocks for the confirmations then you really are limited by the speed of light.
So for for achieving consensus so you cannot go really much below of a few seconds delays to cover the entire world and include all the different uh edges of the network topology in the consensus mechanism. But if you want to go for regional for for city location or some niche or or maybe branded forms uh at the high throughputs then you go for L2s. And still we hope that always um this is very natural that you that you mean the assets initially high value assets on L1 and then maybe move them to L2s for for trading. So definitely usually the first choice for someone who thinks for about broader outreach and a lot of transactions should be L2. Uh and then you support it with L1 or deploy on one if you think that you're really targeting the the high value operations, high value uh customers.
Okay, that's that's a good framework to think about this. Um you kind of talked about the fact that you as the foundation are talking to financial institutions. Um what's kind of been the common theme around the questions they're asking and what is exciting them that you had to kind of spin about team for this?
Um yeah there's lots of questions about our attitude I think as a foundation the like do are we open to have conversations? Will we appear in some like dinner invitations or smaller events? will appear in New York. Uh there's lots of questions about about the fees for example the the revenue model and uh
of the layer one you mean? Yeah, on the layer one, layer twos, um, they want to understand, I think, what what it means that, uh, that layer twos are on top of layer one, how they bound to Ethereum. Uh, the lots of questions about about probably the the values around stable coins and uh, and nowadays also the digital assets, treasury companies and toward attitude to those. I think this is mostly what I've heard in the last last few days.
But is this from the point of view of like oh we think the people building the protocol are the best people to answer the question or is it that you have a goal by also engaging with them on on your end and you want something to happen and you're trying to also come to a a conclusion or a goal.
So institutions they very rarely ask about the protocol specifically. Uh I think that maybe L2L1 is the closest to understanding what it means, how do we scale and so on. What's the long-term plan? Uh there are some questions about AI and robotics. So lots of uh
financial institutions.
Yeah. From fund managers and so on. They wanted to say like what what's there for Ethereum in the next 10 years? And I really like that story that look ethereum is really fundamental for not only finance but it will integrate AI and robotics in the future and will be the coordination layer. Uh they like it and they ask about this is is this true that we can do it on Ethereum and I say yeah absolutely this feels that you have already a movement of people that feel we want to build it on Ethereum.
Uh and this that was a few times already in the last few weeks they said okay that's this is great. I think that even a financial institutions they want whenever they they allocate their attention they want to feel that this is not the last 10 years and the result and we're just like closing the story but uh that it will carry them for many years forward that they want to build for their portfolio companies for for their view of of where the world is going.
Okay. I mean I'm I'm surprised by that but that makes sense. Um there's clearly a pattern that we're seeing which is a lot of L2s launching um in partnership with exchanges um and they're they're definitely on on top of Ethereum. There's also kind of some specific uh stable coin related um initiatives here um both L2 and L1. How do you kind of think about that as as EF?
Yeah, sure. There's lots of questions about the stable coins once now. And again, maybe I'll I'll keep using this New York comparisons. I think that Ethereum still presents itself as this Manhattan space that you have the plurality diversity of ideas, you have fashion, you have real estate, you have um you have financial services, uh you have really
sometimes traffic jam
once again sometimes the traffic jam too.
Yeah, like that's true. That's true as well. And also also it feels that Manhattan is like a good comparison because you have a bit of mix of things that just happen to be there and you think oh that's like maybe maybe not exactly pure just luxury but you you have everything that feels I want to be in Manhattan and L1 is a bit like this as diversity but it's not just payments not just just just banking. I think opening the L1 that just represented a stable coins. L1 is a bit like space for for finance only and then I feel it's a bit like going to the bank branch and then they offer you some additional services like maybe maybe some holidays maybe something with a discount or maybe card maybe like frequent flyer program.
uh so it feels natural expansion there but probably as an as a fullscale L1 may feel a bit bare and uh it should be amazing as a very optimized uh optimized payment system feels very natural that that system to go global should should move over time to O2 to B2 on Ethereum it's our role at the foundation and the entire E interum ecosystem to show how the Ethereum is great platform for going global and for connecting with all the commerce and all the uh all the real estate real assets finance that if you if you just process payments on the side that you want to be connected to this space and that all the global economy is there. So you maybe optimize it for technology infrastructure, maybe with some centralization, maybe with uh with other optimization solutions, but to to go global consensus and connection to global network uh east and west, you want to go with but
this feels more of a scenario where you have to kind of promise that hey a year from now or two years from now this will be possible. But the time and investment that somebody else wants to uh to put in to get going with their own initiative where they get to control the full stack. Um how do you kind of think about that decision being more reversible by them because at that point they've invested too much time. They have ideally bootstrapped a better ecosystem and it may not not be as as easy or simple. Um, have you kind of had any of these types of conversations or like how should an institution think about this because we're going to see a lot more of this and I would not be surprised if every bank has a has a chain.
Yeah, I think that we hear about the L1 premium and people think that at least in the short term you you have some opportunity to to launch an L1 and be seen positively. But you also see things like um Cello network that moved to become L2 on Ethereum and they see more usage, more activity from transactions, better flows and they generally uh are really promoters of that of the transition from being the alternative L1 to being an L2. So if that if that helps to start as custom L1 maybe sometimes because it attracts funding from from VCs maybe because it gives that space for ambition I think it's very much welcome especially if it uh if it attracts a lot of new users to the blockchain space very often this goes through uh EVM chains very often it will go with a very strong bridging to Ethereum chains probably always uh and then it's uh that's a great distribution framework as well uh then the only the only worry that you hear probably from institutions they'll be asking so what what will be with this revenue model and so on and we say it's all about the distribution in the end and placing Ethereum over years into the center of all the global economy uh will definitely solve the any any revenue questions if that's uh that matters for for people but we see it really as a network for impact and it will have massive power as the center of the flows
but this requires you to have a stance on how the L1 should be capturing better fees from L2s, right?
Possibly. I mean, like this this this really is a bit like a slider in the future. So, even now in Fusaka, you will see the minimum uh minimum fee for the blobs uh coming as one of the IPs and I think that's uh some some of the uh architects of the Erum Foundation like Dunkrat, they they really wanted to show that look this is that simple. as just like switching switching the fees, but it's just not the right moment to talk about uh charging the L2s for payments. And for a long time, I think it shouldn't be because we want to see billions of users and
billion is is Yeah.
Yeah. Amazing. Well, my last question to you is um I mean more of a a general kind of what's on your wish list for what things you want to see from the rest of the ecosystem. What do you think people should prioritize? What do you think is important that people are not working on?
or you just want to see more of
particularly for for for New York. I think that we want a lot of people that understand uh the financial services or products like the the world-class products that are being built in New York and connect with builders from the web free ecosystems that understand how to deploy on Ethereum in no time and and just build those uh doubles or trios of founders that say we cover everything and we can really deliver uh the product that will get traction that will solve the real problems and start deploying that on Ethereum because it feels like it's the right time. You have the payment networks for stable coins. You'll have a lot of a lot of inflow of users that no longer feel feel fearful of what's this technology. There is support on the regulatory side.
There will be lots of investments I guess and uh this is the time but to do it still in the disconnected space where where some people build an Ethereum and some people built finance on the side. I think it's in the middle the connection of the two that will be uh the biggest opportunity now. So I encourage people to to build their
amazing damas. Thank you so much for the conversation and please give him a big round of applause. [Music]
Automatic transcript — names and jargon may be misspelled.
