ETHKL 24 | Shuyao Kong, MegaETH | Why Hasn't Ethereum Had Breakout Use-Cases?

now put your hands together for co-founder of Mega eth her name on X is brother Bing and she'll tell you why ladies and gentlemen [Music] Shong okay I realized that my the oops okay I was going to say the title of my presentation was a little Grim but I promise you was quite optimistic presentation first of all I want to thank uh the organizer for inviting me I've heard quite a lot about Malaysia and K so this is my first time here I'm looking for a recommendation to go uh for laxa I'm obsessed with lxa so if anyone of you knows a good spot I'm I'm all years like literally all years um and uh I actually also want to thank Victor so Victor and I have known each other before he started Manta uh we both went to harbard together and then uh he studied Manta which was really focused on privacy their knowledge proof you know they were in the polka dot ecosystem and then they moved to ethereum and I've really witnessed how the entire team um navigated the crypto ups and dance because as a Founder right it's really difficult especially when the market uh goes a little bit haywire here and there uh and I've also seen how he used to build in the US and now he comes to Southeast Asia and he has been just like telling me every single day to come to KL uh that's why another reason why I'm here uh and also uh he has a really cute puppy called Kuma I don't know if people know so it was also on one of the slides anyway it's like the cutest dog ever you guys should check it out anyway uh now on to what I'm talking about today so the um the theme of my talk is why has in ethereum well why has in crypto um build another uh breakout use cases any one here is new to crypto oh there's one person okay anyone here uses crypto okay anyone here uses crypto other than trading on centralized exchange anyone here uses Unis swap anyone here uses iway all right anyone uses poly Market it's probably rare I mean are you American no okay um anyone here uses opy blur anyway okay oh so a lot of like jpack enjoyer here um great so um it's I think this this crowd is way more crypto native than I imagined but there was an incident just an hour ago which made me realize that you know there are still very few people who use crypto native solution so one of the volunteer was really kind enough to get me uh a cup of coffee and obviously I was asking her like how can I pay you right and then uh so it turned out that he she only has gra um grab and pay I in know one of the local fintech provider and another volunteer uh I was like oh can I say crypto another volunteer only had a local centralized exchange where you know there's no usdc or usdt and there is xrp which made me realize maybe xrp has real adoption that I thought so uh the point is we have a long way to go and then I'm using this tweet because uh June one of the organizer tacked me on this tweet uh before my talk and the question is from Nick uh one of the uh the investment partner one confirmation and he was saying you know after 15 years why haven't we seen more breakout use cases than coinbase uniswap openc and po market so today I want to talk about this question why hasn't crypto had breakout use cases but more importantly are we there to actually have breakout use cases and also lastly why Mega East which is a protocol that I'm a co-founder of so um anyone here who disagree with me that there's stigma around crypto raise your hand now there's no Stigma interesting what's your why why do why do you think there's no Stigma sorry there is stigma so I was asking if anyone thinks there's no Stigma okay so almost everyone agree but I wanted to talk about exactly what the stigma is because if we don't understand the stigma we don't understand why there hasn't been breakout use case so the first one is uh I think resonate with what Skyler talked about right uh and I summarized this as crypto is often perceived as a downside protection technology right when we're thinking about Bitcoin we always think about oh my God the world is ending but thank God there's Bitcoin but the fact that we're thinking about the world is ending and often time on Twitter you see okay World War I is is happening and Bitcoin has to moon right and this is the stigma around crypto where like only if the world is afed up then there is crypto compared to AI right everyone uses AI they're like oh my God there's a Utopia here right that was what Skyler said if you use chbt you would actually understand what's a value proposition there but it's almost like with Bitcoin or crypto sometimes is when the world is then you're like oh my God thank God I have crypto I think the second stigma is financial nalism which we're seeing more and more uh these days and I had to check GPT by the way Financial NE nalism because I think it's an overly abused concept it's really difficult to understand which I think in the crypto use case is you know everything ma doesn't matter like nothing matters really other than you know pumping and dumping shitcoins and um you know launching shitcoins at this point I and I do think that's what crypto is known for and that's what people associate crypto with even though in our mind it's probably like oh we're overtaking the traditional Financial system but to Outsider it is financial nalism and the last one is really difficult for me to bring up but I I do think is true it it is this get-rich uh mentality and the reason I put it here is um I've known a lot of Founders or really good friends before and they're coming to crypto and I would think oh my God these people are so smart they must be built something that's just legendary revolutionary it's going to bring crypto use cases but it turned out that they only came into get rich quick so it really and I think it's part of the reason of the first two uh bullet points as well but I think as a result you're getting a lot of bright people coming to crypto rather than contributing in meaningful way they're coming here to do things that's you know contribute to financial nalism and I think the lastly the most important thought is building a crypto application is freaking hard anyone disagree right get rich quick maybe in the last few years was easy but even nowadays it's really difficult like if you are doing like pump pump party sorry pump. fun right everyone like kind of knows about it but even nowadays like everyone is iterating on pop. fun and it's just the matter is not there anymore so crypto moves really fast but the everyone seems to um Circle jky in the same category which is around financi ISM so why is it so hard I think the biggest reason is there are there is like a almost a lack of imagination in crypto right everyone knows the value proposition of Bitcoin maybe some of ethereum but so what what's next is extremely difficult to identify and I think the second reason is there is a cat and mouse race here which is you know this idea between you have a breakout application and you realize the infrastructure is not there infrastructure is there but then you have you don't have any application so the infer AB dalama has always been there and really no one has it is a feature of our industry but it's very easy to blame infrastructure right when the apps is not there and then blame apps when the infrastructure is there so are we ready now I actually do think so I think ethereum has never been better than today and I think I've never been more optimistic than today uh I think l2s are scaling uh the wallet is getting better and better I used to run BD at consensus which cover metamask um anyone here uses metamask anyone here likes metamask I used to just what do you use now Rabbi okay rabie is fantastic yes I mean thank God there's Rabbi right like the wallet stack is improving but if I look at what metamask looked like seven years ago which is when I first dra consensus to till now there is a big Improvement uh and it's way more usable than before right and I lastly I think we are getting much better on and off ram solution um so I think the cat and mouse race the infra app race between in crypto is actually getting a lot better I think the infrastruct infrastructure is definitely here and I think the last reason why we're ready is because we have amazing Builders like people all of you guys are still here is a testimony that ethereum is very much Alive and Kicking and everybody is iterating and as I mentioned before I think the real struggle is none of the stigma blah blah blah whatsoever the real struggle is why crypto like what we use crypto for other than the very obvious and I here I offer two uh two perspective I think the first one it is Shifting economic power so I joined crypto in 2017 and the reason I joined ethereum was I used to live in Africa for two years and uh anyone here visited Africa have lived there okay no one um so so when I first moved to Nigeria in 2013 uh I experienced really bad currency depreciation so it's like you wake up one day and you realize you lost like 20% of your saving you're like what the heck is going on I've done nothing wrong and then quickly you realize that most of the poverty in the world is caused by human is not caused by Nature it's not caused by aliens it's basically caused by sometimes it's government sometimes it's people in power so it was a really rude awakening to make me realize that crypto has to exist and crypto exist exist because you have an open permissionless Ledger e EOS system and Community to shift economic power so you're no longer under the control of people who have vast power over like what's the price of the rice you're eating today so that has left a really big impact on me and I think that's at the end of the day why everyone here is building and is building on ethereum I think the second reason is I do think that the act of working in crypto in blockchain and building is about building a new world and what does this really mean so in a physical world it is for example coming to ESL it is going to Devcon uh it is going to one of the zalu right for example Mega E and IG we're also hosting a little um zalu in chamai it's called Mega zoo and the focus of that is just building application right there's no actually zero intellectual conversation it's just shipping code so that's the physical world of World building I also think there is an element of online World building like we're all first internet friends and then we became real real life friends but think about a World building in a way more Cypher punk way right think about autonomous World think about having an open Ledger where you can write smart contracts and then you have instant liquidity come in from all over the world so the second perspective I think of white crypto is allowing people to contribute to build a new world so now let me talk a little bit of what is the role of Mega E here so first of all what is Mega E uh Mega E is the first realtime blockchain right I can tell you all about TPS and no one should care about TPS because TPS is a measurement of utilization rather than capability what really differentiate Mega E is our latency so we have uh zero uh one to 10 millisecond latency which compared to other blockchain is just significant lower so for example people often time compare us with salana salana has 400 millisecond latency we have 10 millisecond latency so you know who's winning here ethereum is winning here uh but let me talk a bit about our team so we are uh a team of people who love low lency data center compute and we love blockchain ethos as well uh so ELO my co-founder study low latency data center computer at Stanford for six years leay uh study basically blockchain at MIT for six years he's also the co-author of the super famous data availability paper with Sham from M ler myself I used to run media consensus for six years uh namc used to be a prop Trader and VC bro before he turned into a builder so m is really innovates at the final frontier of blockchain performance why am I saying final frontier so come there are so many layer twos right and we're not here to build another layer two what we're building is something that will contribute back to ethereum so so far most of the layer to have been innovating on the consensus and dat availability part whether it's optimistic proof or TK proof proof but no one has been optimizing on the sequencer part which is the execution layer and that is our specialty and I'm going to walk you through a very little C graph to make you understand what is our technical secret SCE so there is a fundamental tradeoff between decentralization and the beff of your Hardware right this is just like law of physics this line here so the beefier your node is uh the less decentralized you are that's why home stakers are extremely important so think about this little rabbit right this skinny rabbit which is skinny so it jumps around it's very decentralized right because it's skinny and but what happens is that it's not performant enough it's tiny right so it's very low on the hardware requirement very high on the decentralization this is e theem and here you have a really fat bunny it's very powerful it can it can do a lot of work sitting there but it's not decentralized right not a lot of people can't afford the beefy fat bunny I think about this as a salana so what Mega E does is why choose when you can have a A variation of bunnies so for Mega is our validation node validating node is extremely jumpy and skinny it's like the ethereum validating uh node and then our sequencer is as fat as a salana sequencer which is why a lot of people call Mega E the real salana right because if you want to be performant you might as well be per performance and still using ethereum security why do you want to build another layer too that's performant but extremely centralized it's just an AWS and this is what we call no specialization so now after talking about Mega E talking so after talking about why we haven't seen crypto applications and you know what is Mega here I want us to unleash our creativity and think about what use cases can we build on top of Mega using ethereum security anyone here uses VPN if you don't I feel like you should not be here anyway or you actually if you didn't raise your hand I think you're lying because everyone should be using VPN um so right now the six largest VPN providers is controlled by two companies uh they are being sued by nation state actively for millions of dollar every single year you know why they're being sued because they're selling your data but then web 3 VPN which has been been attempted many times during the 2017 Ico era none of them took off why because no one want to use a um a buggy VPN for sake of privacy right users don't want to use anything that's not performant but then Omega is we can actually for the first time have a decentralized VPN that protects your data well as being performed as web 2 VPN how the reason is our latency because we have 1 millisecond latency so you're able to harness uh a decentralized note Network allows traffic to jump between different note and without sacrificing your performance because of the latency so low and the Second Use case is fully uned Minecraft anyone here plays Minecraft or your children play Minecraft okay your kid play plays Minecraft you play You're the kid um you know when when I met this team I was like I've never played Minecraft right I I grew up in China my parents just would not allow me to play any game so I didn't understand the reason and also why why does it have to be onchain is this like one of those game f uh scam uh but the more I got to know the team and saw the product I realized that this is the World building building I'm talking about in my second bullet point is that you know you are creating a permissionless open world where anyone can write a smart contract to do things so for example if Victor here has a bank on the uh Minecraft what am I gonna do I'm incentivized to raid his bank right like I would want to get his gold out of it what is he gonna do he's gonna hire an army protect his bank and then all of a sudden you're creating interaction on train that is per permissionless that anyone can contribute to I think that is the most crypto use case that extremely undervalue and this is autonomous world that I think is unique to ethereum like soana people would never be creative to think about autonomous world I'm sorry like the casino there is good but they cannot B for punk as us and lastly um everyone uses centralized exchange I don't think people use it because they like it like if there is a better experience on decentralized Exchange everyone would use it but the reason why decentralized exchanges are bad because of capital efficiency Omega is because we have millisecond latency for the first time you can have high frequency trading which means Market maker can start making experience better and pricing better and this is only possible Mega E so all the past three use cases are only possible on Mega E and this is the reason why we build a layer two and we're not here just to build another infrastructure right we're here to build use cases along with the infrastructure so you probably heard me keep mentioning where the first realtime blockchain what is realtime blockchain right the definition is that the blockchain continuously stream massive volume transaction offering using near instant feedback and Confirmation this is very important because our CIS Mega is is that web through applications are not just as good as web2 web through application must be much better than web2 application that's why we're here if we're just building web to application what's the point right web three applications are better because we have inherit peer-to-peer Network and there is Crypton native Primitives that allows everyone to shift the economic power but I want that to sync in web3 applications are better than web two applications so lastly um people often ask me what is Mega is stand for what's Mega truth to be told in the beginning we're thinking Mega is 10 to the six so it's a very powerful roll up and then one of our investor was like oh wait hang out Mega is Mak eum great again right it literally stands for that and I realized the Wi-Fi password in ESL is also make etherum great again and I would here to say something like I think ethereum is great already I do think that ethereum has gone through scaling pain and we we have gone through imagin a void of imagination but I think the infrastructure here is ready and we have to dream bigger and the only reason we can dream bigger because we have to believe that web application are better than web to we're not here to replicate we're here to innovate I think etherum people are inventors every other ecosystem are innovators but at ethereum we invent so anyway thank you for having me I'm a bit overtime um here I can more than happy to answer any question later on but I'm here all day thank you guys ladies and gentlemen a round of applause of Shia Kong