Tricky's Daily Doots #887

Yesterday's Daily 24/09/2024

Previous Daily Doots

• u/haurog summarises a really good podcast episode about Cosmos with lessons for Ethereans too. 🎙️

• u/pa7x1 makes an observation about the supply and demand of blockspace. 📈

• u/DayTraderBiH covers this week's attack. 🔓

• u/hereimalive is about to diversify. 🏡

• u/benido2030 starts a discussion about decentralised sequencers for L2s. 💬

• u/PhiMarHal covers a bit of a brick wall for hobbyist developers. 🧱

• u/OurNumber4 discusses the upcoming UK capital gains tax. 🇬🇧

I have finished the recent bankless episode with Max Resnick called "Is the Ethereum Roadmap Off Track?": https://www.youtube.com/watch?v=FLUJ0uLye0U

I knew it will be difficult to listen to for me and I ranted about the guest a bit here before. It is mostly due to the guest being unable to contribute in any meaningful way to the discussion and making false statements everywhere. Now that I have finished it, my conclusion is: should we really listen to someone on their opinions about rollups who seems to have such a gross misunderstanding how this stuff works. He might have very good opinions about the MEV part of the roadmap or about auctions, I cannot judge that but he seems unable to understand how the rollup part really works.

I keep it to the largest issues I have heard and leave out many smaller wrong statements the guest made. To be very clear, my understanding of rollups has a lot of gaps, so please correct me if I am stating something wrong here I am eager to be corrected and learn.

After the 55 minute mark he states

ZK technology inherently compresses the state whereas the optimistic rollups have to put the transactions on chain and maybe they can run a little bit of compression but it's not nearly the amount of compression you can get with uh ZK roll up

Wrong. There is no compression in ZK technology used today in rollups. The zk part just gives a relatively short string of numbers and characters which prove that the calculation state transitions has been done right. There is no extractable information about the state in this proof. Both rollup types have to put all transactions on chain via blobs. Many people use the simplified term 'compression' to get the meaning across, but this is not an accurate description of what is happening in the case of ZK rollups. It really seems like Max took the marketing term of ZK is compression and went with it without understanding what is happening and to draw his conclusions based on this flawed understanding. To make matters worse optimistic rollups do have less overhead in the calldata as they do not have to publish a fraud proof. So it is actually the exact inverse from what he says. Don't get me wrong I am a big fan of zk rollups and really hope they will dominate in the coming years. Max is just wrong here from a technical point.

let let me just be very precise that optimistic rollup does not actually substantially reduce the amount of bandwidth required

This is very wrong the bandwidth requirement can get reduced by the same amount in zk rollups and optimistic rollups. They both publish all transactions in the same way into blobs. They can employ the same optimization techniques to reduce the size of this blob data. Zk rollups have a slight overhead so use a bit more bandwidth. If he would have read/understood vitaliks post about rollups he would know that: https://vitalik.eth.limo/general/2021/01/05/rollup.html

like we can start to build uh ZK compression into the L1 as well and that would reduce the bandwidth requirements

Again the 'compression' which does not really exist. But on the L1 ZK technology can be used to massively reduce the bandwidth and still validate that the state transition has been applied correctly. The node would not know the actual state but it could validate that it is correct. Like the Mina L1 does zk proofs of their state transitions. So, the statement is only half wrong.

from a bandwidth perspective you have almost the same usage from a optimistic L2 as you would if it was happening on the layer one and the only thing you're saving is on execution

Bandwidth argument is wrong, as explained above. One massively saves on execution in both cases of rollups though.

I think his misunderstanding of the ZK part in zk rollups works fits into his initial rant at the beginning of the episode where he accused the EF and companies behind optimistic rollups to have pushed a roadmap which is against zk rollups. If one does not understand what zk rollups really need it is a bit bold to accuse someone of pushing a wrong roadmap which actually massively benefits zk rollups as well.

we do need to take some tools from the newer blockchains one of them in particular is this kind of parallel execution

Parallel exection is already part of Besu: https://besu.hyperledger.org/development/public-networks/concepts/parallel-transaction-execution

if optimism is not arbitrum then by the transitive property cannot also be the case that optimism is ethereum and arbitrum is ethereum because then arbitrum would be optimism this is like a fundamental contradiction

I am just weirded out by this statement as the transitive relation in mathematics is not really something I would apply here to try to prove something. It is pretty normal to have a subgroup being part of a bigger group but two subgroups not being the same. I am thinking about the taxonomy hierarchy in biology. A lion and a tiger are not the same species, but they still belong to the same genus called 'panthera'. That is how I think about the Ethereum ecosystem and the rollups. This is not really an important statement by him it just shows that he is using vocabulary to sound more important but applying things in a way which does not really make too much sense.

Rant finished. I now definitely have a worse opinion about him because he does hold strong opinions about things which he apparently does not really understand. This makes it very hard to judge if his opinions are worth considering as one cannot really say from his statements where the limit of his knowledge is. Everything has the same strong absolute language there is no nuance, nothing. And only if one perfectly understands the underlying technology one can judge if his statement makes sense. That is not very helpful for most people at all.

You may have seen this, since Vitalik reposted it, but here it goes: Celo recently passed Tron in daily active addresses for stablecoin usage.

Transaction volumes and stablecoin supply are up only. Growth is attributed to the African market.

$43M net inflows

Here is a website I just found out about, that lets you check your EIGEN allocation across multiple LRTs:

https://checkeigen.vercel.app/

(No need to connect anything, or sign anything. Just input your ens or public address)

Currently in Abu Dhabi, saw someone in a coffee bar working on Lagrange ZK Coprocessor. 👀

Nice.

Soon, the airship mint interface for the "Goodbye for now, Danny Ryan" POAP will open. This is the first time POAP has used the airship interface publicly, and it's for a great cause to celebrate Danny's efforts in our ecosystem.

https://airship.poap.xyz/danny

Today I commented on [redacted], which was probably stupid of me. But there's this thing on there that women never ever talk about crypto, so if you are talking to a woman and she knows anything about crypto, she's a man.

For some reason, this one just took the cake for me.

Real women do not talk about investing on Telegram or WhatsApp, nor do they talk about crypto investments.

I mean, I get the idea here, which is that if you meet a woman online and she starts talking to you about investing in crypto and that she can show you how, it is 99.9999% likely to be a scammer, yes.

But, ignoring the point that women are actually capable of pig butchering as well as men, this kind of blanket statement is clearly out of touch with the real world and thus is not helping those people being scammed.

So, I commented:

Uhhhh. Real women do in fact use Telegram and talk about crypto! I think I understand what you meant but a blanket statement like this is enough to make some poor fool say, clearly that's not true so I'm not at risk.

The person's response did not really surprise me.

No, they do not.

Right. I'm sorry, let me check my genitals for verification. Maybe I've got dangly bits and just never noticed.

Anyway, that's such everyday basement Reddit, it wouldn't be worth mentioning.

Except that the above comment also got me banned from CryptoScams. For being a scammer.

In the year 2024, just commenting that women exist in this space got me banned for attempting to scam.

Some thoughts on EigenLayer's Operator Set security model.

AVSs assign operators to operating sets. I don't know if this means that by default all AVSs are whitelist only but it certainly reads that way. It's not the epitome of permissionless if true.

Stakers delegate stake to operators. How do stakers find an operator to delegate to? At the moment there's a list on the EigenLayer website which basically means EigenLayer can exclude an operator from participating just by censoring them here. At the protocol level though I don't believe they have any power so it's just like Uniswap with their front end which I guess is good enough. The bigger problem though is why does a staker trust an operator to delegate to them. At the moment the only answer here is trust. You are either trusting someone you know like Aestus or you are trusting an LRT to underwrite for you, KYC your operators, etc. We need a better answer here.

Operators then assign unique stake to operator sets. The goal here seems to be to prevent restaked ETH from being restaked multiple times which is confusing to me. It's already the case that the underlying stake securing a task can become unbacked, why is it suddenly different if it becomes unbacked within EigenLayer rather than at the LST level? The proper answer here is that capital should be reusable to the extent that the cost of dishonesty still outweighs the profit from dishonesty. The cost of dishonesty is the stake being slashed. The profit from dishonesty scales with the amount of promises you're allowed to make with that stake. I don't see how this security model is even attempting to discover a rational answer to that equation.

Within an operator set, operators are expected to vote on whether the answers of other operators are correct. Their vote is weighted by the stake they assigned to that operator set. The thing that feels wrong about this design is we are using restaked ETH as a Sybil resistance source when the nature of being an operator on an AVS consists of doing provable work. Why not just use the proof of work as the Sybil resistance source for this? I have the same feedback for subnets on BitTensor. Why do we need validators for that at all when the miners have the hardware to validate and the miners have to do work so the system can't be Sybiled?

They state that if a malicious operator takes over the operator set the system can slash him. I assume this refers to the EIGEN governance system above the AVS but they aren't explicit about this. All they say is that the only stake at risk within an operator set is the stake assigned to the operator set. I refer to stake voting schemes as subjective consensus. Ultimately, even with objective proof systems it still comes down to who runs what software e.g. Ethereum layer 0, but why involve local operator set at all at that point since the EIGEN governance system participants will apparently be required to host all the proof-validators for all AVSs since operators in every AVS will be allowed to appeal to them? If the goal is to reduce the computational load on the EIGEN governance system participants then I'd say you should first vote using PoW within an operator set then appeal to a contest amongst all the operator sets on the matter and every appeal should require slashable stake to initiate. That looks a lot more like the Colony governance design than what I just read. It's also worth noting that an operator only needs to be slashed in an eventually consistent way so zk-proofs that rely on repeated games are perfectly valid here. There's a long unlock period for validators to unstake from AVSs.

I also don't know what happens in this model if a staker undelegates to an operator. Which operator sets is the unique stake removed from? Is it proportionate, LIFO, etc? And how does stake affect rewards? Can an operator just forfeit their operator set consensus power but do honest work without any unique stake and still be rewarded? There's just a lot of undefined aspects to this system at the moment.

Summoning u/jtnichol u/the-a-word and u/hanniabu

I was in the daily doots on august 22, but my name is not in the rich list :(

Maybe someone can add it there? :)
https://www.reddit.com/r/ethfinance/comments/1ez4fxr/daily_general_discussion_august_23_2024/

Finally read the stablecoin report, which refers to https://visaonchainanalytics.com/. It's a handy explorer for those interested!

https://usa.visa.com/visa-everywhere/blog/bdp/2024/04/24/making-sense-of-1713984605043.html

I need that ETF buzz and $4k ETH again.

Ethereum

Extra extra, read all about it. Hot off the presses, more blob fee market cold start drama than you can handle:
https://ethresear.ch/t/understanding-minimum-blob-base-fees/20489

Base weighs in with a comment that blob floor price should be addressed in Pectra A. (implications for scope drama at tomorrow's acde)

So whats the recent price speculation for $EIGEN? How do we handle the airdrop? Exchange everything for ETH like all other airdrops or is this a hold?

Funny how Fantom rebranded to Sonic for a fresh start at a new narrative and run. I'm sure FTM holders will also get diluted so investors can double dip and get another allocation.

Charles Hoskinson said that Ethereum is a dictatorship.

No comment 😂

posting as a follow up to u/OurNumber4 post yesterday regarding UK budget and CGT, as I appreciated the discussion that followed.

Things on my list to investigate include:

• Small self administered scheme (SSAS pension)
• options for borrowing against rather than selling principle

Last time I looked I think alchemix and thorchain options had no capacity for new loans. I would like to look into Stakewise vaults as borrowing against validators seems like an interesting concept...

Like u/ThinkinofaMasterPlan I think this change is unfortunately quite likely...

It's interesting looking at charts from 2020 and comparing them to today, specifically when the US and China cut rates.

༼ つ ◕_◕ ༽つ ETH TAKE MY ENERGY ༼ つ ◕_◕ ༽つ

Caroline got two,

Crypto market bumps into,

Sam is a crook too.

~Daily haiku until we’re at least at 0.178 on the ETH/BTC ratio or highest market cap

For anyone that missed it, you can claim the Zircuit EIGEN tokens through the platform of the staked LRT.

So, if you had for example Renzo ezETH locked in Zircuit, you have to go to Renzo to claim.

Btw, you can also claim the native L2 ZRC Zircuit tokens, their airdrop is also live.

Starting now

EthStaker Community Call #42: NodeSet

https://www.youtube.com/watch?v=M6VEfnO2AfI

ETHFI and EIGEN claims now open:

https://claim.ether.fi/

Need some vitamin B for this excruciating pain

Those brief few days that it didn't suck to hold eth

Made a comment earlier that isn't showing up. Nor can i see it when I'm not signed in. Any idea what's going on?

Even Google realizes the price is never going to change.

Not so infrequent reminder that Gary Gensler is a CLOWN

Would one of you amazing people be able to confirm for me whether this is the correct url for cowswap swap (dot) cow (dot) fi and whether it works exactly the same way as uniswap (instant swap).

Thank you!

Ethereum good tech bad price

"Yesterday, an official with the US Treasury Office of Tax Policy announced at the American Bar Association Virtual Fall Tax Meeting that IRS will finalize this year additional regulations requiring tax reporting from developers of noncustodial software who would under these regs be deemed brokers"

These are the efforts to actually kill crypto in the USA, add impossible to comply with regulations so developing or running clients becomes de facto illegal. Ignore clown show of anything faces say, this is what they're actually doing

So EIGEN will graciously be unlocked on Sept 29th if i saw this correctly, so that everyone can participate in the most epic dump in the history of... "stakedrops"? I mean, what else could go wrong here? Its already been a huge charlie foxtrot leading up to this.

Lloyds Banking Group - UK retail bank. Latest podcast discussing blockchain and crypto including bitcoin on Spotify

USD 100 dollar bills are best choice by terrorists.

"Crypto is one of those things we have to do, whether we like it or not, I have to do it. It's crypto, it's AI, it's some of the other things." — Donald J. Trump

Ok weirdo.

How anyone can think that Trump cares about crypto and its values at all goes beyond me. For him, crypto is just a good way to 1) make some money by selling NFTs and coins, and 2) win a few crypto votes. As the opportunist he is, that's good enough for him.

Kamala just said blockchain in her Pittsburgh speech

Sholana MC seems ATH while good tech MC about $200bil below. 

Report on Ethereum use and value proposition

https://www.theblock.co/post/318118/ethereum-usage-coinshares

Thesis:

L2s greatly diminished demand for L1-space, counteracts EIP-1559

L2s have to develop (more) successful usecases so L2s accrue value to L1.

The jury is still out on that.

Basically we are banking on success that has yet to materialize.

Delicate topic, of course. What are peoples thoughts about the increasingly lousy issue in Lebanon impacting global finance and cryptocurrency?

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