The way you breathe defines the way you live. - xh3b4sd

We have been in the belly of the beast this past week. We have been to Brussels for EthCC. The heart of Europe and the power centre of the EU. Not to dwell too much on politics, but to me personally the state of the nation had a rather rotten smell to it in many different ways. I would summarize my bottom line for the continent of Europe under the heavy stone of bureaucracy like this. Stupid games for stupid people! But enough of it, because it was EthCC's time to shine. One takeaway for me has been that the Ethereum ecosystem, and I think crypto as an industry at large is a complete cross section of society. This community is representing almost any type of character in almost any aspect of life. We have talked to people who do not know what they are doing. We have talked to people who are outright delusional. We have talked to people who are only here for the money. We have talked to people who want to build towards a better future. We have talked to people who are absolutely brilliant. And we have talked to people who are absolutely lovely. The main conference of EthCC was accompanied with over 400 side events across all of Brussels. You could go to multiple venues every day and talk to so many different people from so many different sectors inside of crypto. The sheer amount of technology projects being built and their sheer amount of diversity has been really impressive to witness first hand. Yes, most of them will fail. And yes, many of our experiments will not yield the desired outcomes at first. Though we have to highlight how much this industry is flourishing and developing despite all the good, the bad and the ugly. I do not subscribe to all the naysayer takes on crypto twitter. Instead I am optimistic for the future of our industry. The best is yet to come!

A common thing that people told me around the EthCC side events was that there are not enough apps in crypto, and how people get tired of infrastructure projects. In my opinion all of those takes are not more than the repetition of crypto twitter herd mentality. Saying that there are no crypto apps that people use completely misses the forest for the trees in my opinion. Statements like these completely miss the point. My sense is somehow that people wait for projects to happen like TikTok, but onchain. Or Uber, but onchain. People expect everyone on this planet to make transactions every day on their favourite blockchain network. And I honestly think that this is totally not what we are going to see at the end of the day. Only because you don't like the existing apps, or only because you don't use them, does not mean that those apps are useless. In fact, it may only mean that you are missing something, or worse, that you are willingly ignorant about what is already in front of your eyes. And that would frankly not be a problem for the industry, but your own problem alone. As one practical example, cars are very useful. Though not everyone has a car. And nobody who is not driving would ever say that cars are not useful, or that the auto industry is useless at large. I think that all applications based on blockchain technologies will inevitably have financial character, in one form or another. Most people are not using pipes directly on a daily basis. But everyone in the civilized world has access to tap water and sanitation infrastructure. Maybe the real problem is that some people have bet the farm on pipe manufacturers, and they are seeing that their pipes from their pipe manufacturers are not yet used in every household. And maybe they will never be used anywhere. I could see that being a factor. And in similar light, I can also see how layers of abstractions on top of networks of networks will be underpinning all financial aspects of live eventually. Because this is simply what we do and what we are going for here.

I came across Rome Protocol since it got funding from Bankless Ventures, among others. The idea of Rome Protocol is to use Solana as shared sequencer for Ethereum. I like this idea specifically because shared sequencers require some form of credible neutrality and inclusion guarantees in order to be useful at all. For those reasons it is naturally pretty hard to bootstrap shared sequencer networks, because you have some kind of chicken-egg problem. Shared sequencers are only used by many if they are credibly neutral. At the same time shared sequencers are only credibly neutral if they are used by many. Now tapping into an existing consensus layer like Solana for shared sequencing is one good addition to the shared sequencer landscape. The only issue with Solana as a shared sequencer today is that Solana still appears to have outages once in a while. And what nobody wants to rely on ever, are those kinds of single point of failures. For that reason I think what we are going to see in the future are market places of shared sequencers allowing blockchain applications to rely on fault tolerant sequencer architectures that provide them with 100% uptime and all other relevant properties catered to individual business models. While I was in Brussels for EthCC I was talking with some developers of shared sequencer technologies. And what I took away from our conversations there was that the potential future demand for sequencing transactions in various ways will likely be far greater than any one L1 blockchain or ecosystem can ever handle on its own. And for that reason I think Solana would be a great addition to Ethereum's shared sequencer landscape. The more the merrier!

In the past we have discussed several instances of US regulatory pressures directed at the crypto industry at large. It is sad and uncommon that a federal agency like the US SEC goes on an unfounded crusade like we have seen the past couple of years. The latest development in egregious behaviours has now just concluded by the SEC closing the investigation into Paxos Dollar. USDP has once been the 3rd largest stablecoin after USDT and USDC with roughly 23 billion USD in TVL. But since the SEC issued a Wells Notice to Paxos in February 2023, USDP almost completely vanished from this industry. In this case, a federal agency has taken action against a legitimate business, causing that very business to be destroyed by losing all relevance within its own industry. And the end of it all is that the government seemingly randomly destroyed economic activity without any form of due process, and without holding itself accountable for it. As far as I know, nobody within the SEC is penalized or punished. Nobody within the SEC has to take their hat and leave. Those events are all outrageous abuses of power that really no business owner should ever suffer from. The government exists to serve us, the people. And the only thing being served was a Wells Notice. The government exists to protect us, the people. And not a single individual has been protected by the SEC's arbitrary tyranny against a whole industry. The only light at the end of this tunnel is the overturning of the Chevron doctrine as discussed in last week's Powerlaw memo. Moving forward, we can only hope that federal agencies will have less power to baselessly interfere in the economy and progress of our nations. And we can only hope that congress will start making better laws in order to prevent misinterpretation of those very laws that we are all living by.

The number this week is 500 million USD. Actually it is a bit more than that. The news here is that BlackRock's BUIDL fund has now over 500 million USD in deposits. What is so great about it? What's so great about it, is that the largest asset manager on this planet is building and expanding new financial primitives on top of Ethereum mainnet. And there is no stopping it. The next big milestone for the BUIDL fund will be 1 billion USD in TVL. And that means yes, TVL does in fact matter. On that note, across all of crypto we can track over 1.8 billion USD in onchain treasuries today. Over 1.3 billion USD, or over 72% of all tokenized treasury products are managed on Ethereum. So yes. Yes TVL matters.