This is epicenter episode 485. If guests Jesse Pollock
Welcome to epicenter to show it talks about the Technologies
projects and people driving decentralization and the
blockchain revolution. I'm Brian train.
And I'm today here with Frederick are announced and
we're going to speak with Jesse Pollock.
He is the head of protocols and the base.
Contributor number one base, being the new roll up based on
optimism that That coin basis launching.
So really excited to have him on and just before we get started I
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app. So if that's Jesse, thanks so
much for being on the show. Thanks for having me all I love
epicenter, longtime listener, huge fan.
Yeah, I do. I like what you said before that
you've liked probably listen to like all the episode that's
pretty amazing, and I think you've done that.
I've been listening for like four years, five years, however,
long it's been going, we should give out NF.
T is for people who've actually listened to, at least, like 95%
of the episodes because I don't think that has all that many of
those. It's almost it's almost 500
episodes. So, Oh, it's a it's a lot of
episode. This thing I run three or four
times a week and if there's new episode epicenter episode, I
listen to it. Cool, cool.
Now we're going to have this be a whole quiz about my knowledge
about the center. This is exactly, who knows?
Maybe we'll just trust you. So yeah, let's get started.
I mean, Maybe before we get into base, I was wondering if you can
talk a little bit about this role of like head of protocols.
Like how did that come about? And like what is sort of you
roll been within cone base Yeah, I better coinbase for six years
at this point about it. I guess I'm about to hit my
six-year anniversary. I joined at the beginning of
2017. After having started, a company
that worked with crypto companies back in 2013.
And the first four and a half years at coinbase.
I supported all the teams that build our consumer facing
products on the engineering side so coinbase, coinbase Proclaim,
his wallet. I joined when those teams were
really small, you know, a handful of people and then
helped grow them too. A couple hundred people.
And then in the middle of 2021, I took a step back from that
role and stepped into a new role at coinbase, which is the role
I'm in today, which didn't have a name at first and kind of had
a singular Mission. It was me and a really small
group of people, and our mission was basically figure out.
How do we bring coinbase on chain as business?
Now, what does that actually mean?
If you think about coinbase, it was started in 2012.
The time you could just buy Bitcoin there.
Smart contracts, there's no kind of unchain economy.
Eventually we had to support for buying etherium like coined a
bunch of other assets and then really in the last few years
with things like USB C and coinbase wallet and CBE.
We started to have more what I would call natively on chain
products which are products that are written as smart contracts
or interact directly with smart contracts and give our users,
whether they're individuals or businesses or developers access
to the kind of the full Power of this platform that's emerging.
But those products are still a very small percentage of our
overall business. The vast majority of video, the
users, the activity, the assets are still in custodial,
centralized systems. And so for the last, you know,
almost two years I've been working inside, you know, this,
I think 3500 person Fortune, 500, public company, trying to
figure out. How do we change that?
How do we go from having? 90% off chain 10% on chain to
having 100% on chain, over the The next few years, and that's
been a Wandering Journey, a lot of learning a lot of failures
and out the other side of that came base, which we think is
going to be a really powerful platform, both for coinbase.
But also for the broader world to come onto the on chain
platform and start building, really useful things that
billions of users want to use. So, kind base is famously, a
publicly listed company, which means you have fiduciary duties
to your shareholders, right? So, what's the high level
business case behind introducing base and bringing coin based on
Shane because basically kind of just justifying that with
ideology isn't enough, left for shareholders.
Right, you have to, you have to have a business case.
Yeah. Yeah.
And if you look at what coinbase, what's made coin basis
business over the last 10 years. I think what you'll see is that
we've made money by making it easy for users to interact with
an access crypto and for the longest time, the thing that
uses have wanted to do in crypto is trade they want to speculate
and so we've made money by making it really easy for them
to buy crypto. So crypto hold crypto.
Do that in a secure way. That's trusted with easy
interface. But I think from the beginning
and you know, this is pretty well laid out.
In Brian Armstrong, our CEOs secret master plan for coinbase,
which you run 2016, their vision for coinbase is to bring about
an open crypto economy. Where there are millions of daps
that billions of people are using that are not just trading,
not just speculative but are actually things people have to
use on the day-to-day life to go about the things they care
about. And I think our thesis is that
if we can accelerate the number and quality of those
applications, then there will be tons of opportunity for coinbase
to continue building easy-to-use interfaces that are trusted for
our users to use those applications and we'll be able
to make money off of that because users will be able to
continue. You know, users will be excited
about paying for the privilege, we're paying for the access that
claim mates will provide as kind of a gateway to web.
Ri right gateway to the on chain economy.
And we're, you know, we're already starting to see this in,
you know, for instance and coinbase wallet, we have a swap
function there that works a lot. Like the the swap function or
trade functioning coinbase.com but it's powered by
decentralized, protocols, powered by u0x and you know swap
but claim based can still charge a fee because it's really easy.
Users can also go into the browser and interact with, you
know, Swap and not pay the fee if they want.
But lots of people decide to conceive because it's easy for
them. And I think our thesis is the
more of those applications, the A growth for the business.
The more things for users to do, the more users really coming on
James and and all of that will be good for a coin basis
business long term. So it's kind of like an app
store business model. Exactly.
Yeah, it's not store business model but I think the thing
we're excited about is it feels like it could be an app store,
but it's not going to be a course about store where
everyone's locked in and you have to you know build the
certain way or you have to pay certain fees because Building on
these open platforms, you know, things like EDM things like the
Opie stack, it's going to be easier and easier for developers
to opt into being on based and being in the clinic proxy.
It's me. Easy for users to opt into using
base, but if people say, hey, we don't want to be here.
Hey, we want to go use applications elsewhere.
I think our goal and thesis is awesome.
Like, that's what it's all about.
That's what the open crypto economy is about.
It's about having choice, and we're going to continue
supporting users to go. Elsewhere.
And then we're going to let the coin based products win on their
merits by making them easy to youth, make him secure, making
the things that people want to use, because it makes their life
better. I'm still not totally following
sort of the, the rationale behind base.
I mean, as I guess, one thing you're saying seems to be like,
okay, we need to have more, you know, daps more stuff and then
that's good for crypto. And of course like that, I
understand that. But I mean, if it's just about
building daps and you feel like, oh, coinbase needs to have a
role in building more depth so that you get more usage.
Then I mean there's lots of like chains Or related to the
Roll-Ups that are coming that you could put those on.
So what's the case, like, why build your own roll up?
Yeah, this is something we've thought a lot about.
And in the beginning of 2022, the way this really started was
we were working with our internal teams at coinbase.
Trying to understand what was holding them back from building
dabs from building on chain. And basically what we saw was
teens were struggling with how do we build on chain?
IE like re-writing solidity VM contracts, are we writing rough
since Lana, contracts or rewriting?
You know, app chains and Cosmos and then most people were kind
of by default pic. An evm because that was you
know, the most popular thing. But then they were getting stuck
with where do we build on chain? You know, do we do?
We put it on LY, don't know it's too expensive.
We put on now to we're not quite sure where on L2.
And so first half of last year we aligned as a business to evm
as a kind of primary development platform.
That's what we saw the most growth and most kind of network
effects from a developer perspective.
If they're ml, one is kind of the place we want to put a high
value applications and then L 2 is this place.
Are we could start to deploy like large-scale consumer
applications things I would reach millions of users but even
then I think with that Clarity we still have two questions like
where and L2 and so in the second half of last year we went
and talked with all the all two teams were kind of like, Blown
Away by the level of creativity and Innovation, that was
happening in the space. And I think as we went through
that process, we had a really big change in perspective about
what L2 was going to look like from an picture perspective.
I think we started with the thesis of there's new 1 L 2.
It's going to be monolithic. And I claim these kind of has to
pick the right one and like that's the most important
decision for us to make. And then I think by the time we
went through that process we ended with this vision of much
more. There's actually many of these
things they're going to kind of run in parallel.
They're going to gradually standardized and interoperate
and work together to scale the etherium.
And I think in that context like the yl2, why should we build?
No to question became more obvious.
It was like we should build now too, because we want to
contribute to that Mash or super chain.
We want to help scale etherium. We want to invest our resources
in the platform. We want to give our teams and
people who want to be building for our customers and easy.
Like, default way to do that. And we can do all of that
without being a silo without being an alternative kind of
like, you know, ecosystem being an island.
But instead being deeply interconnected to what right now
is the largest crypto ecosystem in the world and then with a
clear strategy and plan. For how we can make sure that we
like have even more interoperability between all the
other people who are working there.
And so I think that kind of like having The Best of Both Worlds
of like creating the platform where coinbase from a developer
perspective, could really start to like make that transition
have The Surety from a business perspective to invest in it.
While also being deeply interconnected was the reason
like why we chose to do this. I'm think the speak much more
about that, right? But you guys are building on
Lucky optimism stack and of course there's like other types
of layer choose as well. Like what in what ways do you
see base differentiating or like, you know what, what do you
what are you trying to do different than other l2's?
Yeah. Yeah.
I think you know building on the openstack and so we're obviously
going to share a lot of the core technology with other l2's
building. On the Opie stack like optimism
a net and we're joining as a core developer.
Early Opie stack which means that we're going to be kind of
dedicating our resources to making that as scalable as
possible as secure as decentralized, which I think is
going to pull up timelines on a bunch of things we really care
about. I think, in terms of the place
where we think we can, we can really differentiate it's about
kind of bringing together, the kind of holistic group of
coinbase products to make it easier for developers to build
and make it easier for users to use applications.
So on the developer side we have a whole kind of developer
organization in coinbase and plugging base into that as kind
of like this just works out of the box with all of our
developer tools is going to be really powerful for making it so
you know, One who's just been writing, JavaScript can get
started and, you know, get started with application and
build it and you know 30 minutes instead of 30 days and then on
the user side and I think this is the thing that I'm really
excited about. We have 110 million verify
users, something like, you know, a B+ billion Assets, in our
ecosystem. And like I said at the
beginning, the vast majority of those are off chain and that's
because it's easier right now. For those people to hold their
sets in custodial systems. I think one of these that we
have is if we take Basically integrated the Colombians
products like coinbase and coinbase wallet.
We're actually gonna make it just as easy.
For those users to use the applications that people are
building as they can. You know, use the first party
offerings from coinbase today. And so what that's going to do
and how to differentiate the chains, it's going to bring all
this demand from kind of real users into Deonte an economy
where these new useful applications are starting to be
built. And I think connecting up that
distribution both do kind of the Enoch components of it, where
users are just finding the applications that they want
through listings or search, which our products were building
into Clay, Mason claims. Well, it is gonna be huge and
then also, I think one of the things we're gonna be able to do
is, we're going to be able to pull or start to build some of
this infrastructure around pay distribution where developers
can be like, hey, we have this great product.
We know what kind of users we care about and claim based can
help them find those users and help the users, find the product
and connect that kind of Market of Of demand in a way that's a
win-win-win for the user, or the developer, and for the ecosystem
because now instead of the 20 kind of holding their assets off
chain, they're bringing them on chain and they're starting to be
a part of this broader crypto economy that's bigger than base.
We're getting coinbase and we think is the kind of like, pop
form for, you know, the whole world coming on chain over the
next few years. Jesse, you'll have to spell out
one thing for me a bit more. So basically having a venue for
your own people to kind of build apps and having a venue to which
you can kind of fun, a your 110 million users in principle.
You didn't need a fresh chain for that or fresh roll up for
that right in principle you could have partnered with any L2
or even are one to kind of make this happen.
And basically, you know, you could have contributed to the to
the technology technology effort and so on.
It has, how much is kind of this starting from a blank slate of
regulatory question in an inn in?
How much is that the business decision?
Because kind of it, lets you gate keep in some shape or form.
I think it's I think it's unfortunate I we're not starting
from a blank blank slate, and I was really important to us.
We didn't want to go out and build our own technology.
That's why we're working on the Opie stack.
That's why we're building, isn't it?
Their email to it's why we're contributing to and building on
top of these open source public goods?
But I think in terms of like why it is a business reason, but
it's not about gatekeeping, it's more that there's a ton of a ton
of value in us having our own on chain home.
And here's the example. That's right for the last year
coin This has been investing EIP 4844 which is an upgrade to a
cerium that's going to lower the cost of all Roll-Ups by 10x.
We've put a few Engineers on that and we brought up the
timelines on that being live from like what was previously
undefined sometime 2024. Now to Summer 2023, that kind of
investment is now like totally makes sense for our business
because we now have a clear. Rationale would like we have
this home. We know that we need to make it
more scalable because it's too expensive for our users.
Like let's figure out what the underlying infrastructure is
that we need to build in order to invest in that and I think
there's a bunch of things that are kind of like that across the
whole company where before we had basically uncertainty around
like okay we have this application.
Where do we put it is here better than there is this going
to work with all of our products and now we've created certainty
insured and we say oh no we have the home, we can invest in the
infrastructure you can build the application, it will work.
By default, like all of these pieces, start to work together
in a way that is much more powerful than any of them
individually. And so I feel like one of the
big drivers for us on this from a business perspective was like
the shelling point of the chain where it's like, now we have the
reason to do all these things on chain and we have the place
where we can feel confident that.
If we do them here, it'll work for us and they'll fit into
again this broader math your super chain of other L2 Use of
other ones of aetherium. So we're not just off on our own
but we're actually connecting people into the broader economy.
okay, I do want to sort of clarify a little bit, you know,
expand a little bit on the question that for uek asked,
which is around You know, to what extent is there?
Some kind of permission in here? Or is it completely, you know,
anyone can deploy like any kind of application on bass and and,
you know, there's no restriction on bridging.
No kyc or like are you introducing any kind of You
know, sort of degrees of control in base.
Yeah, so we think about base as a layer 2 and we think about
layer twos as a scaling solution, an extension of
aetherium. And if you look at our track
record over the last year and a half, I think what you'll see is
that coinbase has been a very staunch defender of the
permission list - of aetherium of the right for users and
developers to write and run, open source code of the right
for people to run validators. And to have those validators,
execute that open source code, you know, even on things like
tornado, cath, you know, coinbase was, you know, the one
of the, I think, the first and biggest company to activate it
around and we're supporting, you know, challenge that that's
working its way through the court systems around the kind of
Open Source nature of this code and whether it's reasonable for
treasury to, you know, put open source code on sanctions list.
And so, I think our plan for base is to extend and build Not
permissionless. Dennis there's obviously a
complex path to that we're in the test net right now.
We've written a lot about our past to decentralization.
If you want to read more about, you can find it on our blog at
based on mirror dot x, y z. But we're working with optimism
to basically figure out. How do we decentralize the
underlying technology here? The Opie stack as quickly as
possible. So that there's no multisig
controlled by one individual or entity that can make decisions
about the characteristics of the chain.
The Censorship of this chain, there's you know, forced
inclusion rights that are upheld at the L1 that even if you have
a sequencer, that's misbehaving transactions can still be
processed and then we're, you know, desensitizing the
sequencing layer. So that more people can be kind
of building blocks and summing. Those transactions to the to
broader out one in batches and so it's going to be a journey as
we work our way towards Main and will be continue to communicate
about it, but We believe in the, you know, permissionless of
etherium, we see base as an extension of aetherium and as a
scaling Solution on top of the theorem.
And, you know, we see that kind of holding across all the layer
twos and that's what we're going to be working to uphold from a
decentralization and open perspective of the next few
months and years. So we're I think we're all
familiar with kind of the decentralization shortcomings of
l2's. I think this is this goes
without saying, we all know this.
And I think this is, it's kind of a dead horse to beat because,
I mean, it's, I mean, everyone always says, look, we are
decentralized this and I think technical technologically, this
is possible, and it will happen. But just to clarify, as is, does
base have any Other permissioning systems or
settings that set it apart from the standard Opie deployment,
we're running the standard Opie deployment.
Our goal is to continue up streaming all of our changes, to
the standard Opie deployment and work with optimism, to release,
consistently across opium a net and base and to have those
operate on the same code base. Could I think this is what what?
Brian was kind of trying trying to get it.
So basically, anyone can kind of keep lie adapt on base if they
choose to do. So in principle, you can censor
them from your interfaces just like an app store doesn't have
to show an app, but you can't kind of exclude them from from
the, from the L2, that's super reassuring to hear.
There's no mechanisms and oop stack code base to do that.
And You know where continue to contribute to the openstack
codebase continuing to decentralized oop stack code
base. I think your observation around
kind of interfaces is exactly right and this is what you see.
Pretty consistently across the board with these layer twos and
now ones as well which is that if folks are hosting things like
Bridges or they're hosting things?
Yeah, I mean like which I think is a canonical example.
There are often times are almost always applying some level
judgment around. What kind of users whether it's
based on IP or addresses, they want to let use those
interfaces, but then they're fighting to protect the
permission of the sness, the underlying Network, smart
contracts, the nodes, that's what optimism has done
consistently. And that's what our plan is to
do as well. We want to be building with
optimism, going towards the centralization and treating
layer to, as an extension of etherium, that protects the
right for developers and users to run open source code.
Just like, people have been running code on other systems
for a long time and just like the internet remains an open
protocol that anyone can build on.
We see etherium kind of upholding the same standards.
SS centralized exchange, you have certain requirements, you
know, from The Regulators, as to kind of funds and users, you can
on board. So where exactly do you draw the
line between the user and the non user of coinbase?
If people kind of move around on base?
Add those people automatically kind of users of coinbase or can
coinbase users automatic? I mean, can they just move
around base? Really, and how do you deal with
kind of funds that you may not be able to kind of onboard on to
coinbase proper? But that have kind of come in
contact or have come to belong to coinbase users on base.
It to me, it seems like really difficult terrain to Steppin.
Definitely very difficult terrain to step in.
You know, I think coinbase is at the Vanguard of trying to figure
out what is the, where are the lines?
And, you know, there's not going to be clear lines on any of this
stuff like the ways were the laws that were working with are
old and you know I think our position has been pretty
consistently like it's time to create new laws that create
regulatory certainty for developers create protections
for users but also support Innovation.
I think to your Question in particular around, like kind of
what's the difference between the centralized part of the
business and the exchange and kind of more decentralized
software parts to business. You know, this is something that
we've actually been dealing with for a long time.
You know, if you look at coinbase.com and the coinbase
mobile app, those things are different than coinbase wallet,
right? Coinbase.com and the Clemens
mobile app, you know, when you sign up You create an account.
Using the password you give us your verified information.
We confirm that information, we do the kyc checks, we report on
all of that, you know, within kind of the the guidelines that
we work with regulatory perspective in different
jurisdictions. That's obviously been hugely
successful for many users and it's different than Clarice
wallet. If you download coinbase wallet
today, you can download climb this wall.
Anywhere in the world, you can use the software requirements
wallet to generate a Private key.
That is yours that you then use to interact with any application
that's deployed on the cerium. Another Network to, and coinbase
in that context is really providing software to let users
manage their own information. Their own data, their own
private, cubes and transact with again this open source software
that's running on a theorem, as kind of a base layer and our
stance on that has been again. People can enjoy I said, run
software and that they should have rights protected around
that, and we're going to support them in doing that.
And so I think that's going to be the same, you know,
regulatory gray area or, you know, lack of clarity that were
navigating with base. And again, our goal is to build
on and extend the kind of foundation that aetherium has
built and see and treat layer to as an extension of that, and
make sure that we're kind of Upholding those values because
we think that That's essential ization that openness, that's
what enables us to build a global crypto economy.
That's what's going to enable us to bring a billion people, to
people billion people on chain, and increase economic freedom
everywhere. Cool know.
I really appreciate you know the clear answer and and that also
the stands, right? I think that's really amazing
that like, you know, coinbase is really building something, you
know, fully open, permission lists and yeah.
So I think that's that's very cool.
One thing I'm curious about, of course any change or, you know,
primarily any change building. Like some kind of chain is not a
new thing, right? I guess most known is like, by
Nance, right? Like the by nouns chain that?
I think kind of failed, right? But then, by non-smart Chain,
which has been pretty successful.
What are they are? Some things that you learned or
something very like, okay? This, these are things we really
want to do differently compared to how bonanzas approached it.
Yeah, great question. And just as like context,
historical data point. We've actually looked at
building a chain twice before and we decided not to in 2018
and 2020. And the reason why we decided
not to build a chain in those times, is we didn't think that
we could launch a chain that would live up to our values and
beliefs about the crypto economy and in particular, we didn't
want to launch something that would put our users on an island
or Silo them or make them be disconnected from all of the
other Innovation that's happening and that they're using
coinbase products to access and I think the thing that shifted
now is we feel like we can we feel like we can have both We
can both create the home for us on chain and be deeply
interconnected to the broader crypto economy.
And I think as we look at, you know, other chains, like Finance
more chain. That's probably the key
difference in our philosophy and approach that we're taking here.
When I look at my Ants Marching, the thing that gets me really
excited. And something that I think we've
learned a lot from, is the combination of having interfaces
that people use consumers, real consumers, use combined with a
chain. Structure that people can build
applications on super powerful. If you look at the activity
that's happening on buying smart chain, it is mostly small scale,
retail users doing small transactions, whether it sends
or receives of tether or swaps of, you know, like $10.
It's every it's everyday people actually using the chain and
that's because they have interfaces that enable them to
use the chain. And that's why by an smart chain
has, I think 10 million monthly transacting addresses, which is
five times bigger than aetherium?
Ten times bigger than the next L2.
And that's I think that's incredible.
It's incredible. Illustration of how if you stop
just forcing users to do things, like pick the infrastructure
that they want to run their apps on.
And instead, just give them products and applications that
they actually care about, they're going to use it and that
can drive real adopter of crypto.
Now, I think our approach is like let's take that learning
and then let's figure out how to do it in a way where we're not
off. Off to the side.
We're not creating our own siloed ecosystem, but instead we
are using base, almost as a bridge and the value that we
repeat over and over again, is a bridge, not an island, which
basically means that we think about base as the way that users
are going to come from off chain to on chain.
And then the way that we're going to enable users to go
everywhere else and we can do that by continuing to support
all these chains across our product other l2s if there is
other L1 equal. Sometimes we're going to do that
by building really deep interoperability between base
and the theorem between base and other altitudes between base and
other L1 ecosystems like Cosmos. Like gnosis like Solana.
And I think are these like we're at day 0 in this story.
There's still a small millions of real human beings who are
transacting on chain every day. And we need to get that too few
billion transacting every day. And in that, it's going to take
all kinds. Kinds of innovation, it's going
take a diversity of different solutions and we want to be
bringing people in accelerating the growth of the broader kept
economy. Having base, obviously, play an
important role in it, but letting users and developers to
choose where they want to be building in a way that kind of
lives up to the best values of crypto and the openness, and the
interoperability that we see making Crypt of such a special
place. I totally subscribe to that
ethos but don't you know, don't dismiss Finance matching too
quickly because what they what they're actually able to do is
they do a lot of? Yeah, you you never thought
you'd hear that for me, right? But I know I love it and I mean
the way that they're doing is they're just able to do massive
amounts. And of transactions per second
by, you know, by virtue of being pretty, you know, centralized.
But I mean, same can be said for, you know, the Opie stack.
But I know the roadmap and so on.
But the numbers of transactions that you can do on an optimism
roll up, it's nowhere near the number of transactions.
You can do unbalanced marching right?
So basically if you have like a hundred and ten million users on
coinbase, how are they all going to fit onto your Or roll up.
Yeah, I really across the board. We have a lot of scaling
challenges II challenge that binds Merchant has some, you
know, like meaningful lead on other L 20s or even other ones
like, like like gnosis, I mean, by Ants Marching is running on
death and Aragon, you know, those are the same clients that
were using to run a theory on the same clients.
We're using to run these layer twos and they've tweaked the
gas. It's a little bit.
So they have higher gas tournaments, which you know, has
the downside of bloating data much faster but the upside of it
creating a little bit more significantly, more throughput,
but I don't think that there's, like, meaningful technological
advantage that by an smart chain, has over other l2s.
And in fact, I think, I think, what is more likely to happen
is, you know, almost like the tortoise versus the hare, right?
If you look at layer 2 on a cerium, there's actually a
pretty clear path. To driving down costs
consistently because the biggest source of costs is L1 aetherium
data availability. And we're running this road map
around 44 for predicting. That's going to create a new
kind of data availability on this area.
That's going to be much cheaper to use and then we can grow that
capacity over time to continue driving down costs.
That's not the same situation for by an smart chain.
Like if they want to solve the like how do we continue putting
so many transactions through by Our chain.
But then manage with State growth, they're gonna have to
figure out how to do that at the L1 context, which is a hard
engineering problem. And that's kind of why yeoreum
has decided to pursue this roll-up Centric, scaling roadmap
where you separate the concerns you do data, availability L1 and
then you push the execution down down to.
And so I mean, I think I think time will tell but today, by
Nance margin is more expensive than other.
All twos maybe has more throughput but But the costs are
higher and I think from a long-term perspective I at least
feel a lot more confident in the scaling roadmap that folks like
if your IAM and gnosis are running with 4844 around
providing data availability tell to us.
I hear that to me. The question is so basically
invariably with an heir to your transaction costs are going to
be correlated with I mean proportional to the anyone fees,
right? So basically there's there's
only so much you can ultimately settle to aetherium, right?
So basically, I mean, even if you I mean, and we are now even
talking about layer 3 is because basically layer tools are
getting too expensive for me. Things.
I recently spoke with Jordi from from polygon.
This is actually this interviews coming out after yours.
So I can't. I basically no one will know
this. But basically, their plan is to
kind of have like this system of chains and depending on what
you're actually requirements in terms of transaction costs and
and security guarantees are they were I commend you a different
chain. So basically, basically they
will send you two polygons, UK, evm or polygon p.
O Ms. Or, you know, any of the other ZK chains.
They're currently incubating, the do you think Bay's can kind
of somehow toe the line between, you know, between kind of
excluding people on economic grounds in terms of transaction
costs were excluding dad or how are you thinking about that?
Yeah, good question. And in first, the first thing
I'll clarify is I think actually that with 4844 which is Proto
dang, starting one of the really powerful things that's going to
happen is we're going to now start to have two separate fee
markets for L1. So we'll have the few market for
like transactions on L1 that are doing execution, like a swap or
NF 2 Min, or whatever. And that will continue to have
the kind of like market-driven demand based on events.
Like there's a big Min. You're going to see more Spike.
You can see higher gas. It's then we're going to have
this other market for blob space which is just the data
availability market and that market isn't going to have the
same kind of demand-based Kerr, as intense demand curves because
the primary use case is going to be l2's that are consistently
publishing data. And so I think one of the things
that are actually going to see is we're going to see a
Divergence of the L2 cost from having that direct correlation
to the L1 execution cost. And instead what we'll see is
over time, whereas To be able to drive down the aisle to cost
because we're gonna be able to create more data, availability
through Protank charting and then folding starting that, I
think eventually should be basically infinite if we can
solve the technology problems. And that's going to mean, we'll
be able to continue driving down cause they say that's that's the
first thing is like, I do think that there's a pass to like
lowering costs on l2's. Consistently for the next decade
in a way that will get Really cheap fees.
The other thing I'll say is, I actually totally agree with
jordi's perspective and you know, we've talked about this a
lot with optimism. We don't think anyone chain is
going to be the answer cryptos too big.
It's a bring a billion people on chain and not only is that a
huge amount of demand, but you also have applications that are
you know, just have really different requirements in terms
of how they run and the mental model that I have for.
This is Model of web to. If you look at the average kind
of developer lifecycle of a web to business, maybe they start on
like a shared hosting solution Heroku.
And then, that gets too expensive for them or it's too
slow and they're like, okay now we can go to AWS.
We're going to run our own computers on AWS that are
virtualized and that works really well for them.
And then they get big enough at some point and they're like wow
like it's too expensive for us to be on AWS.
Now we're going to get our own Data Center and we're going to
have our own data. A thinner.
We're going to that's in the hardware.
We're going to find you never going to make it work
specifically for our use case. I actually think applications
and crypto will go through a similar trajectory where they'll
start on a shared chain and it will be like, oh now we can like
get easy access to all liquidity and it all just work, it's
really easy to deploy. And then after a certain point,
they'll be like, wow, now we're in this chain and we're like
paying all these Gatsby's. And it's not really working
perfectly for us and we've scaled me of millions of users.
What if we would be better served by running our own So the
stack and having it interoperate with that other chain and still
have the same API or interface available to users through other
chain, but have our own kind of custom stack.
That's powering the underlying business logic and I expect that
to happen. That's why we're building on the
Opie stack. That's why we have this vision
of a super chain where what will happen over the next five years
is we're basically you have thousands millions of chains
that have different use cases that serve different kind of
application developer needs and that It all kind of fit together
through interoperability so that the user, they aren't having to
make choices of like, am I running on this one or that one?
Just like you don't make choices around like what's my Tier 1
versus tier 2 is p as I'm connecting to internet instead.
They just run the applications that they care about and the
kind of abstraction of the super chain.
However, that shapes up to be, make sure that that's executed
in the right place. And so, I think polygon, you
know, spend a lot of time apologized.
Their Vision, our vision and the cosmos Vision.
Everything's kind of converging to this idea that there's going
to be many of these things. They're going to interoperate
they're going to have different configurations of data
availability and that mesh is going to be the thing that
enables crypto to grow to billions of users.
I think the places where there's difference in differences in
perspective. Are you know what exactly is a
technology that we're going to use the coordinate?
Those things where exactly is the data availability going to
live? What are the kind of
Foundational validator sets or you know trusts networks that
secure different parts of the system.
People have different perspectives there but I
actually think from a like architecture perspective we're
generally converging Yeah, absolutely.
Well, we have talked, we've mentioned quite a bit, you know,
pisac, you guys building on that and on Optimum On optimism.
Now, of course, that's not the only layer to technology is.
I mean, arbitrary term is of course the other roll up that
today you know it's life and has significant traction and then
there's a lot of other things coming right with more like
based on ZK technology. So, Why did you guys decide to
go with the Opie stack? So one note on Dopey stack and
just kind of optimism. Very optimistic versus ZK.
Roll-Ups generally and I think we don't think about this as
like an optimistic or ZK, roll-up question.
I think our thesis is that as these technology is mature,
basically, what's gonna happen is because they're all open
source because this is all being done in the open.
We're gonna be able to bring together the best of all of
these things to upgrade the chains.
And so as we've been building, Based and as we've been kind of
doubling down on the Opie stack. I think the key thing that we've
really optimized for is how do we create a modular foundation
for this chain? So that as the technology
matures we can plug in the things that make it better.
And so an example of this is we're starting with optimistic
fault Gruber. That's going to be the thing
that kind of secures the network.
But that proved ER component of the Opie stack is module and the
second we have AZ, K EB M, that's mature enough.
We can add that in either in a multi prove or setup or as a
replacement for the optimistic Poober.
And I think we believe that over the next few years were
basically going to increment to the upgrade this thing.
So that sometime in 2024 2025, we're gonna have many provers
running in parallel. They're going to provide more
resiliency, more redundancy on the system.
Lower finality time between L1 and L2 and make it so no failure
in one place, you know, risks user funds.
So that Kind of mental model of like this isn't optimistic or
ZK, roll up but instead it's like optimistic and ZK roll up
and it's like how do we build the system to be upgradeable so
it can be flexible to those technology improvements.
I think has been The Guiding kind of North our processes.
We've been building base in terms of Y optimism and oop
stack. Specifically, I'd say there's
really four reasons. The first reason is this kind of
Technology question? It's like you know, how did we
get to how do we make sure we're building on a sufficiently
modular sufficiently strong? Nation for what we think will be
many many years. If iteration in terms of making
this chain high quality and we feel great about collaboration
with optimism there. Other thing also says, we also
feel great about all the other incredible work that's happening
in the industry. You know, the work that our
drums doing is totally Cutting Edge.
They've been leading the way on the Paul Kruger scroll in terms
of having the ZK U VM that's UVM equivalent.
I think they're really pushing boundaries polygons in terms of
just moving quickly. Getting things out the door.
You know, huge inspiration there.
And I think our goal is to not just work with optimism but to
work with all of these teams to figure out.
How do we bring the best of these Technologies together to
scale, the crypto economy, and make it possible for a million
Builders to create the applications that bring a
billion users on Jane. But anyways, the first ones
technology, I did a second. Big reason why we're working
with optimism is the kind of Licensing and open source
approach of the OPC. If you re m is open-source
freely available, that's been the thing that has both driven
so much of the Innovation that's happened around the theorem
because people could for can experiment with it and I think
been so essential to protecting that permissionless nests and
openness that we talked about earlier.
And I think optimism's approach with the Opie stack is the same
and that felt really important to us.
We want to be taking our resources, not putting them into
a silo, or I think that was just-- benefiting coinbase, but
instead putting them into something that was open source.
Something I was freely available to anyone could benefit from
whether they wanted to join in with us and build or Fork.
So that kind of open-source ethos was the second reason, the
third reason was often isms work and thinking around funding
public goods. I don't know how much you guys
know, but they've been running these retroactive public its
funding rounds. And in general kind of pushing
the boundaries of like how can we make sure that we're getting
the money that's created in these systems back to the
underlying infrastructure, whether its core, internet
infrastructure or a theorem in Structure like Gap and not their
mind in Oregon or the Opie stack infrastructure.
And so, contributing to that, and being a part of it, and
supporting those public goods, felt really important to us.
That's also why we're contributing a portion of the
revenue That Base generates from transaction fees back to that
retroactive public goods funding mechanism, through the optimism
Collective. So I was the third reason and
then the fourth reason was We started working with optimism
little bit more than a year ago, on VIP 4844 which again is this
upgrade to a theorem that was before we started working on
base, we didn't know we were going to build now to it that
time, we were just wanting to scale here again because we felt
like scaling a theorem was going to help the industry which is
going to help coinbase. I think through that context of
like working on a theory, mm together and writing code and
writing docs and like collaborating, we build trust.
We got to know each other. We got to fill out each other
and be like, do we work well together?
What I think we saw was like, yeah, we work well together.
And this is actually been a consistent pattern that we've
seen. Which is that the shelling point
of a cerium from a collaboration perspective of finding people
and starting there and being like, let's work on the theorem
because we know it's going to be good for all of us.
And then as we do that, Now, as we build that context, how do we
kind of add on additional collaborations?
I think that's been a really powerful approach that has
consistently, brought us great people who we love working with
Yeah, that's that's super interesting.
It's funny I've actually never had this.
I mean basically building upgradable infrastructure
protocol is this is is super difficult because you kind of
have to know where you want to be able to upgrade right.
You don't want to be able to upgrade everything.
So how how far have you planned this out to kind of upgrade Bays
into a z. Okay.
Roll up because basically from an engineering perspective
that's that seems incredibly complex and really difficult to
kind of lay out. So basically, to me it would
seem it might, I mean from it and you know, from practical
perspective and might even be easier to just redeploy a new
roll up, that's kind of innately ZK, you know, rather than kind
of ensuring that you can upgrade in all the right places.
I think there's a lot of hard technology problems to solve
here. But I think one of our goals and
Theses here is this is a long-term investment, a
long-term project. We're going to measure our
success on the order of beers just like if you're in has
measured its success on the order of years and I think, you
know, we've been inspired by a theorems ability to consistently
make progress and upgrade itself.
Even as that has been a real challenge.
You know, something taking longer than we might want, but
that At malleability and the ability to evolve, I think it
has been very inspiring for us, in terms of like the specific
technology side. You know, I think with the way
we've been building, the openstack is to have as much
modular as possible around the proving layer and around the
data availability layer, because those are the things that feel
like from our perspective, they're the most.
Well, defined in terms of places that we will want to upgrade.
Evolve data availability right now is obviously going to be a
cerium. We want to make it so people can
also use the Opie stack to not run on ethereum whether that's
putting their data on other L1 or putting their data in the
data availability committee, that's gonna allow them to run
it. Much faster and have much lower
fees, so I'd say and then improving side, really talked
about this, you know, thinking about optimistic, rolls-royce's,
you get robbed. So I think those are the two
areas that we focus most on From upgradability perspective, in
terms of the exact ZK you No path there.
I think it's, I think it's very possible.
I think one of the things that we definitely feel is like it's
the, it's not the expertise that we have a coin basis and I also
don't think it's the expertise that optimism has a topi, Labs,
optimism foundation, and this one like that at some in some
ways that feels like a risk in some ways, it also feels like
exciting to us like what that means is there's face for more
people to be building with us, you know, there's space for
other teams to say hey wow, this is a value.
Both yelling Point like let's figure out how to make this work
and we're you know, we're having some of those conversations
today and I think that there's a very real path to both bringing
the technology but also bring the talent together to
contribute to you know there's open source interoperable freely
available tool kit that's starting to kind of shape up to
scale it cerium and the broader crypto economy.
When are the other drawbacks of optimism is kind of the
withdrawal period, right? So basically, I think it's
pretty well known that when you kind of want to withdraw
something from an optimistic roll-up, you have like this
weight period of one week and for many assets this isn't
really that much of that big of a deal because you can have like
a liquidity protocol that kind of upgrades on top of it.
But it's a major usability problem for everything that's
nonsense. A fungible oral liquid, right?
So basically, so if you have an N ft or any sort of at a station
or social graph or whatever and you want to bring it down from
this, optimistic roll up onto another optimistic rolled up or
layer, one, or another layer one, that's you're locked in for
a week. And anyway, how are you guys
thinking about that? Yeah, I'm definitely a challenge
and, you know, to your point like for fungible assets, this
is much less in the challenge because, you know, we you can do
kind of liquidity bridging across them and coinbase has a
product that makes it. So anyone can bring assets from
autism to aetherium or polygon to aetherium or Arbitron to
etherium instantly. And I think we've seen that
that's pretty consistently been like the solution for users and
do appreciate that on the non fungible side.
I think, I think you're exactly right.
We have work to do here. It's, you know, one thing that
gives me a little bit of Solace has people are used to waiting
absurd amounts of times for some of these things and existing
Financial system. If you think about like getting
a loan or you know, getting your identity verified by the DMV
like people's expectation bar for getting that like final
check if they want to move somewhere else, it's pretty low
today. So I think that that gives us
time to solve this as we get there.
I think there's some paths that we could follow like obviously
you know, upgrading or incorporating a ZK, roll-up can
lower the finality there. I think that there are things
around L2 L2 interoperability that can get us faster than kind
of the L1 finality, through shared sequencing.
I'm really excited about that. I think the thesis, I generally
have it. Most users sometime in the next
little while, will start to on board directly owned L1, L2 and
live directly on L2. And they'll, we will actually
have that many reasons to go to L1 unless they're, you know,
large-scale business users who will probably be already on L1
and now world, you know, if you're on 1 L 2, great like you
know, you don't run size shoe, if you're on other l2's, I think
that there's a path for us to get more interoperability there
that Laura finality, so definitely a hard problem
definitely one that we think needs to get solved in order to
you know, provide the ideal user to experience here.
But also one that we think we will be able to solve with time.
Who is so M, let's talk about the depth developers who will
deploy to base. So I assume in the beginning,
this will mostly be Cross deployments of things that
already run on other chains. So how do you go about?
Not starting on an empty chain, right?
Because if the on the if on day one you kind of all open them.
All and say this is our decentralized model everyone.
Go look at It it and everything. I'm loving their attacks, right?
Yeah, yeah, exactly. So how do you go about kind of
creating this day? One experience for your
currently centralized users. Yeah, so one thing I'll note is,
you know, like the natural course of changes, you do have
some inevitable, phasing that has to happen.
Like you have to do genesis, then you have to get some
infrastructure on there and that supports other infrastructure
that supports and other infrastructure and that supports
the product. So I expect like we're not going
to on day, one have literally everything ready to go because
they depends on, you know, Swap and you know coin made small
interface for borrowing. Ends on Ave and we need to get
all those things sequence. So I expect like it will be a
one two three month period where we're going to be doing that
bootstrapping in terms of like, you know, if we think about that
is just kind of a given for any chain, how do we make sure that
at the end of that bootstrapping, the mute that
basis the Lively exciting place that people want to be, you
know, one of our values is that basis for everyone.
And we tried to embody that best, we could pre-announcement.
We're going to contract try and embody that as best we can post
announcements. As well.
And so I think we went out on last Thursday with something
like 70, Builders who committed to be Building on Base includes
basically every kind of Blue Chip protocol in the space, a
ton of different infrastructure. Providers do multiple block
explorers multiple node providers, multiple data
providers multiple nft data providers and that multiple
thing has been really important to us.
One thing that we really wanted to make sure was that we weren't
Making everything, just climb base.
So, it wasn't just like first party, first party, first party,
because that's all like, it would set everything off on a
wrong tone and basis for everyone and that we weren't
making it a winner-take-all. There like a king making
situation, where we were like hand picking someone.
And, you know, that person was going to go and kind of take all
the value. And so, for every category, our
goal was to get at least three people that we felt like, could
be kind of a viable option for Builders, and users who are
coming on chain and Achieve that in the opening kind of
announcement in the folks who have already committed to
building. I think post-launch, we've been
exceeded my wildest expectations in terms of the amount of demand
and inbound that we've had over the last five days is been a
fire hose where you've done for this week.
I'm doing this for my hotel room and similarly feels like a
little bit of a fire hose. I think people see the potential
for what we can do. If If we, you know, connect up
the coinbase distribution connected to coinbase
experiences, to the on chain economy and they want to be a
part of that. And so obviously there's a lot
of work for us to do in terms of making sure that those folks you
know get situated that they have the right to learn that they
have the right infrastructure. They have the right
documentation. I think we're off to a really
good start. I'm about to go do a workshop
with the, you know, a bunch of builders that you've Denver to
help them build on bathe this week.
I'm just going to be Literally on the ground meaning people
connecting with people being as helpful as I possibly can be and
hammering home this value that we have, which is that basis for
everyone, it's an open ecosystem, it's not just
coinbase, it's not quite amazed chain, it is base, and base for
everyone. How many of these all your base
are belong to us? Jokes, are you getting lots?
Yeah. You are very first week.
All your base are belong to you, which felt much more like, you
know, we don't your base, you on your base, it's for everyone.
We actually, we tried to put that in the Genesis block for
the test net, but we messed up and so it's not just as black
for the test net. That was the plan.
We'll see if we put it in the chest and spot for the main.
Now, we might put something else or still deciding.
Yeah. Maybe one of the things we love
about the name base. I mean there's two things we
love about the name base, lat, In so many things about the
name. Based, what is that?
It's just like spiritually connected to coinbase, you know,
it's like of coinbase but not coinbase, which feels really
meaningful to us to, is that obviously, it's connected to
this meaning of, like Foundation, of kind of being
this essential part of the broader kept economy and
platform and then three, it is like the most memorable meme
word ever, like the number of based memes and all your, all
your, all your Our Belong To You memes.
We have a whole meme Channel acquiring base that I haven't
yet, gotten permission to just share publicly.
When people are just been baking base memes, we've tried to build
on that mutability with the blue dot, which we think has worked
pretty well. But in general, like, there's so
much great content to be created here and we think that that kind
of content is the stuff that's going to bring in everyday
people to come use base and that's who we need.
If we want to get to a billion people on chain.
It's going to take a lot of memes.
Absolutely, you mentioned maenette launched.
Maybe final question here. I mean, what is the timeline for
minute launch and maybe if there are any other major Milestones
that are coming up for bass? Yeah.
So we're working to get to Maine as quickly and safely as
possible. Hopefully next few months, one
of the things that we, you know, I think benefit from here is
like, we're not running this chain.
Like this is not the first test net for this chain.
This is not for the technologist, powering the
chain. We're not like, off on our own
doing this, and so that's going to have us.
Let us have a shorter test net period, Then potentially other
things that are coming to Market because we have that resiliency
and redundancy and the battle testing that's already In other
ecosystems, I think optimism is currently planning to bring
Bedrock, which is kind of the release that we're running on
two main that in mid late, April and will pass follow them.
So no specific timeline. But next few months is what
we're aiming for. There's a lot of excitement, a
lot of anticipation. We're going to do it as quickly
and safely as we can and get based in the hands of builders
that they can start building and are my goal.
It's not that I haven't set the goal yet but it's the framing
that I've been working with is a built a million builders on base
in 2023. A billion people on base in 2024
Wow. Okay.
I like that. That's a good.
That's an audacious goal and I've got one of these days.
It's gonna happen. Yeah, it really does feel like
we've been You know like climate crypto has been kind of like
working its way past a certain point.
The platform is going to work, we're gonna have the right w.
We have the right identity tools were gonna have the right wallet
infrastructure. We have the right chamber, sir,
it's me low-cost enough and to me, it really feels like this is
the year where those pieces are finally, like, almost ready like
they're in sight. And we just need to push a
little bit harder to get them. All to work really well together
and that's going to be this Catalyst that will drive the
next, you know, billion people and change cool.
Well, Jesse, thanks so much for coming on is been really a
pleasure to speak with you. I think you did an excellent job
at sort of explaining to us what base is and and I think one
thing also really appreciated, you know, like emphasizing and
sort of, you know, the values behind that and calling basis
values. And I think for sure I agree
that, you know, coinbase has been doing, you know, a very
important job, right? In, like trying to like push
back a bit against like, all the horrible regulatory ideas and
Gary Gensler. And whatnot is coming.
So I think that's you know really important, right?
And hopefully you guys will continue to do that work and
advocate for, you know, free and open decentralized systems and
open Financial system. So thanks so much and really
excited to see how basically develop and how are we going to
how you going to fare on these these targets that you guys are
have set. Well, I appreciate y'all having
me on said, help people build on base.
Cool. Thanks so much Jesse, and thanks
so much for listeners for tuning in.
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