Bankless - 139 - The Cosmos Thesis with Sunny Aggarwal & Zaki Manian

Episode Date: October 10, 2022

✨ DEBRIEF | Unpacking the Episode: https://shows.banklesshq.com/p/the-cosmos-thesis-debrief  Sunny Agarwal and Zaki Manian are crypto OGs that have been in the Cosmos ecosystem and community from the very beginning. Sunny started the Blockchain at Berkeley, the largest student organization for crypto in the world, and also co-hosts the Epicenter podcast. Zaki is helping ship Cosmos’s IBC, is working on the validator ecosystem, and is also an advisor to the Electric Coin Company, the org behind Zcash and is also a co-founder of Iqlusion. On today’s episode, Sunny and Zaki share what the Cosmos Thesis is, how Cosmos is similar and different to Ethereum, and what Cosmos’s ATOM 2.0 unlocks for the ecosystem. Zero to 60 in one episode. This is the Cosmos Thesis. ------ 📣 Galxe | Explore Crypto’s #1 Credential Network https://bankless.cc/Galxe  ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/  🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/  ------ BANKLESS SPONSOR TOOLS: ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum  ❎ ACROSS | BRIDGE TO LAYER 2 https://bankless.cc/Across  🦁 BRAVE | THE BROWSER NATIVE WALLET https://bankless.cc/Brave  💠 NEXO | CRYPTO FINANCIAL HUB https://bankless.cc/Nexo  🔐 LEDGER | NANO HARDWARE WALLETS https://bankless.cc/Ledger  ⚡️FUEL | THE MODULAR EXECUTION LAYER https://bankless.cc/Fuelpod  ----- Topics Covered 0:00 Intro 8:05 Zaki & Sunny 10:08 The Cosmosverse Conference 18:38 Cosmos’s Central Thesis 23:10 Metaphors & Ethereum vs. Cosmos 29:18 Trade-offs 36:13 Monetary Premium Thoughts 40:18 Osmosis & Power Laws 48:24 Stablecoins on Cosmos 54:13 L2s vs. Cosmos 1:09:11 Cosmos vs. Polkadot 1:14:52 MEV Problems & Solutions 1:23:24 ATOM 2.0 1:32:16 Mesh & Interchain Security 1:41:50 Does ATOM Break Top 10 Tokens? 1:43:43 Will ATOM Flip ETH? 1:44:50 The Future of Cosmos 1:49:03 How to Explore Cosmos 1:50:44 Closing & Disclosures ------ Resources: Sunny Aggarwal https://twitter.com/sunnya97  Zaki Manian https://twitter.com/zmanian  ATOM 2.0 https://forum.cosmos.network/t/proposal-draft-a-new-vision-for-cosmos-hub/7328  The Inevitability of UNIchain https://medium.com/nascent-xyz/the-inevitability-of-unichain-bc600c92c5c4  ----- Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here: https://newsletter.banklesshq.com/p/bankless-disclosures 

Welcome to bankless, where we explore the frontier of internet money and internet finance. This is how to get started, how to get better, how to front run the opportunity. This is Ryan Sean Adams. I'm here with David Hoffman, and we're here to help you become more bankless. Today, we are going to explore the cosmos together. This is the Cosmos thesis. We brought on Zachie and Sunny, who are developers, app developers, and longtime Cosmos community members to talk about the Cosmos thesis. This, I think, will give you a zero to 60. on Cosmos in 90 minutes. I think it's a canonical episode

for this community, for this ecosystem. In fact, the guest said, as they were leaving, this is probably the best Cosmos episode they've ever recorded. You've never heard, yeah. You'd be the judge after this episode. A few things to look out for.

Number one, we talk about the Cosmos thesis itself, how it's similar versus how it's different to Ethereum. Number two, we talk about Ethereum as a tree versus Cosmos as a fungus. If that makes no sense to you now, listen to the episode and you'll see what we mean. the difference between the fat protocol thesis and the tall app thesis. That's another distinction we make. And Adam 2.0, a new white paper was just released with new token economics and a whole new

Cosmos hub design. We talk about the new features and differences in that design. We also ask Zachy and Sunny if they think Adams could one day flip ether in terms of total crypto market cap. David, there's so much we unpacked in this episode. Why are we talking about it? Cosmos, that is. And what should listeners look out for as they listen? The cosmos ecosystem, the cosmos community, the cosmos philosophy has always paired nicely with Ethereum while also being different. I remember reading the Cosmos White Paper in 2018 and really having like an aha moment. It's like, yo, this is something real that's new. And it was specifically about cross-chain interoperability. And even when I was talking to Sunny at ETC forever ago, he said like the cosmos and Ethereum communities have

always been very philosophically aligned. And I think when we get into this episode, the listener should really pay attention to, I think, the accepted truth that Cosmos and Ethereum converge at their logical conclusion in their design philosophy at the same place. They both believe in the same general outcome of how these ecosystems look like. Where they differ is how they get there. And how they get there, the Genesis stories for these change, does impact what these things ultimately look like, Cosmos started its journey as a network of interconnected sovereign application chains that weave themselves together, later adding a shared security model. Ethereum started its journey with the central security model of ether, proof of work,

a canonical, single monolithic chain, folding into now the beacon chain, and then many chains organize around it. We have the app chain model in Cosmos, we have the layer three model in Ethereum, we're each going after the same design structures. So the listener should really pay attention to what are the net consequences of a system that emphasized the security first, which is Ethereum, and ether of the asset first, which is Ethereum, versus an ecosystem that emphasized the sovereign app chain model first and then added security later. What are the net effects of that? We've used this metaphor in Bankless and I use this in the podcast that if you re-roll the dice of the crypto industry over and over and over again, you will see something

like Ethereum unfold out of that 100% of the time, 99.9% of the time. And I think that's also true for Cosmos. And that is why I think the cosmos and Ethereum is like two sides of the same coin. We will always see these two models. And I think these two models, the App Chain model, the central security model of Ethereum, that is what crypto has to offer. These are the logical conclusions of crypto design philosophy, in my opinion. So I think with that context, I think the listeners should be pretty well equipped to go into this episode and get completely downloaded as to the whole Cosmos vision. The other thing, of course, to think about as you're listening to this episode is, where are the investment opportunities in Cosmos? And David, I think I want to talk

to you a little bit about that. Some of my thoughts on investment opportunities, but we'll save that for the debrief. And of course, the debrief is available for you who are premium members. It's our episode after the episode where we talk about the episode that was, upgrade to premium membership. if you want to catch that as well. Full disclosure going in. I own Adam tokens. It does not represent more than 5% of my holdings. We take disclosures very seriously at bankless. So we're starting to mention them at the top of every episode. There's always a link in the show notes if you want access to see all of our bags. Our full disclosures are located there. Guys, we're going to get right to the episode with Zaki and Sunny from Cosmos. But before we do, we want to thank the sponsors that made this episode

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Bankless Nation, we are talking Cosmos today with two of the best experts we could find in the space. Sunny Agarwal is a crypto-O-G. He's been in the cosmos ecosystem since the very beginning. He's a man of many hats. He's been all around the space. He started the blog. blockchain at Berkeley, a student club. This was the largest student organization for the crypto world at the time. And he's also the co-host of the Epicenter podcast. Sunny, how you doing? I'm doing great. You know, just got off of three days of Cosmoverse, which is the big Cosmos conference. And so in decompression mode right now. I understand that both of you guys are recovering from Cosmosverse. Hopefully we'll get some of that energy back into this podcast as we go through.

We also have Zach Manion. He also wears many hats in the Cosmos and Cryptos space. He's been in the Cosmos ecosystem from the very beginning as well. He helped chip most recently Cosmos's IBC, which is an interchained blockchain protocol. He's also working on the validator ecosystem. He's been an advisor to electric coin company. You remember Zucco and team from Zcash. And he is a co-founder of a staking provider as well. Absolutely. Zaki. Welcome to Bankless. How you doing? I'm doing great. Cosmoverse was the best, but like I'm glad that I flew out of I was like, do I stay in Colombia for DevCon? And then I was so tired. I was like, I'm going to leave. I'll recharge, come back. So this was in Columbia then? Yeah, we did it in Medellin,

Columbia. You know, Columbia is getting a lot of love this year from the crypto community with DevCon being there and Cosmos First being there for sure. It's great. There's actually a Bitcoin cafe, like a crypto cafe in Medellin that we got to do some events at. I think Bogota's going to be very different, but from the experience of Medellin ended up being phenomenal. How was the conference for people that weren't able to attend and also people that are wondering what the temperature is during the bear market. What was the energy like? What was the vitality like? How many people were there? Fill us in on what the Cosmosverse conference was like. I don't think you could tell that it was a bear market. This is the second Cosmoverse.

We had the first one was last year in Lisbon. It was like a sandwich in between like Eat Lisbon and the Salonah Conference. And I think there were maybe like 500 or so people there. At Cosmoverse this year, I think there was about 1,500 people. So it's like three times bigger while we're in a bare market. And like, you know, last time there was a lot of like overflow traffic coming from the other places. It's like here. It's like everyone who came here like came for Cosmovus, right? And like shows how much like there's a lot of excitement and like growth in the last one year even. And a little harder to get to than Lisbon.

You know, you weren't already there for other stuff where it's like, yeah, I'd say a third or more people were just like, okay. Like I'm in town for Breakpoint and for New York Con. I might as well to Cosmoverse 2. Again, the origin of this conference is like very typical of Cosmos, which is like a person named Cryptocito. He's a YouTuber, has a relatively popular YouTube channel about crypto. He got interested in Cosmos in early 2021. He started to build up a following in the community. Jack Zamplin, who is my co-founder, another one of my projects called Similei Finance, has another validator business.

and I was also like a core dev in the ecosystem. So Jack and I had been kind of looking for people to help us bring the message of Cosmos to the world. And we found that, you know, Cryptocito was doing a really good job. We had taken up, there was a marketing DAO that was set up called Prop 34 that took money from the Cosmos Hub treasury. We ended up spending what was remaining in that to sponsor and like give Cryptocito the funds to do Lisbon. This time, it was like multiple chains. So it's the same person now, you know, held this much larger conference in a much more difficult location.

He had a staff like 150 people working on it. It was sponsored directly from governance proposals for multiple cosmos chains. And, you know, 1,600 people could throw up. There were after parties and events every night. It did not feel like a bear market at all. And then like the other thing that was really unique about this is there's literally never been a cosmos conference where anything was announced, like really. The little chains would announce stuff, but like ecosystem level announcements had never happened before at a conference.

And we actually were able to do both the Adam 2.0 white paper and the announcement of USC coming natively to Cosmos at our conference. David, I remember like we talked about at CCC when we had our interview there. I said ETC is my favorite conference. And part of it is because, you know, I just always feel that ETC has a very community, just the fact that it's a community organized conference rather than foundation organized conference. It always had like a more interesting energy to it to me than even DevCon. I like ETCC better than DevCon. And like every other ecosystem, it's always like foundation throne conferences, right? Cosmovus feels very much like ETC for the same reason.

It's not a foundation thrown conference. It is like a random community member decided to do this. Yeah, and it's very emblematic of what Cosmos actually is, which is a little bit more bottom up than Top Town orchestrated. Would you credit the success of this conference while Cosmosverse was harder to get to in a different part of the world, three times as many people showed up while crypto prices have gone in one third, right? And so, you know, one third, the amount of capital in this space, yet three times the amount of people showed up. Where's all this energy in Cosmos coming from?

What would you guys credit the vitality, the source of vitality here? I mean, Cosmos as an ecosystem has just grown a lot, I think, especially, you know, in the last three, four months, I think, I think the DY, DX sort of announcement of like switching over to Cosmos. You know, I know Zazaki was pretty involved with that. What like that, I think, just got a lot of people's attention. And people are like, wait, here's this like project that's like been building on Ethereum forever. And like, you know, why did they suddenly decide to like make this sort of switch, right? And so people started looking at the reasons at why, like, DYDX did it and started learning more about, you know, the Cosmos thesis is very complex. And

like, you know, when you're switching from Ethereum to, I don't know, Avalanche, like, oh, okay, cool, it's faster. Yay. It's like, no. No, but like, you know, when you're searching to Cosmos, there's like a whole set of like fundamentally different things that we're doing that like when they do with the DO IDX announcement, people start to actually look into that. I think a lot of people just got very interested in the thesis that I think it's like, like, that we've got very interested in the feces that we kind of just like snowballed like from there over the last few months. Before we break down, I think the thesis and how this like really complicated idea of how we're different from Ethereum and how we're basically different from the blockchains that most people are probably familiar with. I also say it was just like we are also basically four or five months out from the Terra collapse. And Luna was built on top of the cosmos technology stack. It was part of Cosmos.

It was connected to IBC. The anchor carry trade passed through both the Cosmos hub and osmosis in a very large way. So we were very economically connected to it. Its collapse felt like it was a devastating blow to the ecosystem. Almost everybody lost money. It was a huge thing. And it's certainly, if we want to talk about, you know, how we all feel about the whole UST story. But it did feel like there was a moment at which there was a bottom there where we kind of felt like, you know, it was like unclear whether or not Cosmos was really going to, how long it was going to take us to recover.

And the recovery happened like far more quickly than anyone anticipated. Basically, I got so much busier in like two weeks after the terror collapse. And it's just like not slowed down. at all since then. Yeah, that's really interesting. You're right. This is not long after the Terra collapse. Would you guys believe that was just like less than five months ago when that whole thing imploded?

And I can't believe it. It's been a wild five months for us. Yeah, I bet. And there's definitely a lot of excitement. One thing I've been observing, of course, in the cosmos ecosystem is the amount of building that's going on. There's also this kind of renewed interest maybe through DYDX and others, but even in the Ethereum community around app chains, which I'm sure we'll talk about a little bit more. And really, I think our goal for this episode is David and I cover a lot in the kind of the Ethereum ecosystem on the podcast, right?

So you guys have to teach two Ethereum idiots, like what Cosmos is, what it's all about. I will say I was involved in the Cosmos ecosystem in the early days. And so it's always been a community that's been kind of, I've been observing and I've liked and I've appreciated kind of the efforts of. But you guys have come a long way as well. Cosmos, the idea, has come a long way. And we want to talk about that trajectory. I think we also want to talk a little bit about the Terra Luna collapse, but let's save that maybe until a little bit later. First, let's talk Cosmos the idea. And David said this to me before we recorded that you told him, Sonny, Cosmos has been called an idea more than an actual thing. Those are your words, I think. Cosmos

a thing, it's more of an idea. What do you mean by that? What is the idea of Cosmos? What is the central thesis? Yeah. The central thesis of Cosmos was that we are going to see a world of not a few blockchains, but many, many blockchains, most of them being application-specific blockchains or app chains. And there's no such thing as a single final settlement layer. In the real world, there is no final settlement layer. We're going to have many, many settlement layers. And every blockchain is going to be the settlement layer for its own native assets and its own native state. And that's what gives it fundamentally sovereignty, right? Roll-ups and other, you know, systems, they don't have true sovereignty from the main chain, right? The main chain is what finally dictates.

It's the final arbiter of truth in this globalized system. While Cosmos is a very, we're all like localists basically. We believe that like, hey, we're not trying to build the world computer, as Ethan Buckman puts that we're trying to build community computers and let these community computers all talk to each other. I know, Zach, you want to add anything to that? All I will say is, so there's another thing that Sunny and that like the Cosmos thesis really believes, which is one of the things we say is that like Cosmos is coming to kill your fat

protocol thesis. So the fat protocol thesis is the way that blockchains will prove out. is that you'll build a blockchain, it'll typically a protocol with a token. That token will have a bunch of apps on top of it. But because the infrastructure layer and the network effects around it are represented by the token, that's where the most value will accrue. And the Cosmos thesis has been from the get-go that where the value accrual layer is is the app layer. It's the application layer that is the thing that is closest to the users. It's the application layer where intent and order flow and everything originates. And that's the layer of the system where the value will accrue.

And we basically purpose built a blockchain stack for people to build the best possible app layers rather than thinking that like, hey, I've built another fat protocol. An analogy that I like to pull to is like if you're in the early web in the 1990s, a lot of people were thinking that the way to bet on the web was AOL. and CompiServe, but now with like retrospect, we know it was Google and Amazon, right? The apps are what were sticky and actually had user relationships and the infrastructure layers. Really, actually, what ended up actually was the biggest apps actually ended up building their own infrared layers and became actually the biggest infrared providers as well through like AWS. But really it is the app developers are the ones who move between infrastructure providers, but users are sticky to the applications.

So we want to leave that out there. So one ideally presenting is rather than, Fat Protocol, fat app thesis. That'd be a way to summarize what you just said. Cosmosis fat app. I actually like this term called tall apps because one of the things, at least with osmosis, what we really believe in is like vertical integration. So like we build our front end. We build our decks modules, but we build the chain itself. And we just happen to build like the primary wallet for the cosmos ecosystem as well. But we have this like, what we actually take a lot of inspiration from is like Apple, which is like a very vertically integrated system. But

that gives them, I think, the best Ux of any product line, right? And so I call these the tall apps, right, highly radically integrated. So just to put a visual, a metaphor on this whole thing, Ethereum, it's got this one canonical layer one. And then we have a proliferation of layer twos. There's like five or six real big ones. Right now is like a big conversation going on in the Ethereum space with layer threes. And this kind of looks like a tree. There's like a big central tree trunk. There are like four or five smaller branches, but still pretty big that come out of this tree trunk. And then they fracture off into like thousands and thousands of smaller branches and twigs that eventually turn into leaves. And maybe these leaves can be like the applications that,

you know, capture the energy of the sun, for example. But it all collapses down to a central point, a central trunk. And that was really the Ethereum beacon chain and ETH staking at the very, very bottom of this whole thing. The Cosmos model is a little more of a mesh and network. I kind of want to say a spider web, but even a spider web has kind of like a center point, but it still kind of looks like a more flat. There's not actually a point in the middle, and these things weave together as like just a net. The actual metaphor is, or like the correct analogy, is like a fungus, the mycelial networks that like pervade the like forests and the earth and do make it so that the trees can actually live, you know. Right. Yes. You have definitely

use this metaphor much better than I have, but that's definitely right. It's Google searching mycelial network for those that don't have an image in their head as a result of that will definitely help. And so the idea here is that like the cool thing about the mycelial networks is that they're just like automatically resilient because there is no central focal point. Can you guys kind of just like lean into this metaphor and help me unpack it a little bit more? So I think one of the big things that we've really believed in cosmos is we do think that like if there was like a core difference of let's say between like sunny and i and vatolic which is okay like vitalik's view is like monetary premiums are really hard but it's really hard to build like a secure decentralized censorship

resistant system without securing it using a monetary permanent so you have this thing where where you have the root monetary premium chain which is the beacon chain and that everything descends from that monetary premium chain is secured by and like reinforces with that monetary premium chain. You know, Sunny at Cosmoverse presented this idea of mesh security, where Cosmos chains actually opt into additional slashing conditions around each other. We believe in, like, ad hoc economic networks forming. So, you know, you have these natural trade routes of which the UST carry trade was one of them. But like, you have trade routes between Adam and osmosis. You have number of large crypto exchanges run their own cosmos change, including OK,

KX and Crypto.com. So then you have trade routes between their user bases and other Cosmos chains. And you see this like what we are sort of expecting is this like network of value to form between these community computers. And like some of the ideas that we're exploring now and are sort of in our vision of the future is to make sure that security can travel with economic interdependence, but you don't need this like root structure. Yeah.

Like an example of this, it would be chains provide. bilateral security agreements with each other. So in this app chain model, people have always asked, like, oh, how are you going to get enough security on every individual app chain? The analogy I like to give, I like geopolitical analogies. So for me, the example is NATO. NATO is a collective of sovereign countries. They all have their own governance systems. They don't meddle in each other's internal politics, but they have a mesh security system, right? If Article 5 says that if any one of the NATO countries gets attacked, they all rush to each other's defense. And I think the same thing will happen with Cosmos chains as well.

And I think what Zaki's point was, it will be based a lot off of economic relationships. So I'll give an example of osmosis and axelar. So Axler is, you know, currently the most popular bridge between Ethereum and the Cosmosis ecosystem. Osmosis is a dex. Osmosis makes up about 70% of Axelars TBL right now, while four of the top 10 assets on osmosis are ETH, WBT, Dye, and USDC are coming via the Axelar bridge. So it's like, hey, we have such high economic relationship with each other. It would suck a lot for osmosis

if axelar got attacked. If it's like for axelar if osmosis got attacked, we should be both providing shared security to each other, basically, right? Osmo holders should be putting up economic stake backing axelar valiers, while axel stakers should be putting up economic stake backing osmosis valedars. So basically, by these two systems doing mass security with each other, they actually have the economic value of both of the market caps combined securing each chain. And you can imagine that this scales with more and more chains. We'll have a network of five chains, ten chains. And the sum value of all of the app chains, you know, it will provide greater equal security to like these L1 systems today. Can we talk about the tradeoff here, which is a tradeoff I think Cosmos has made from the very early days. Zaki just alluded to it. And Sunny, I think you also alluded to it in your answer, which is

sacrificing monetary premium, essentially saying that the token at the bottom of a layer one chain does not need to, and perhaps should be designed not to accrue monetary premium. So coming from maybe kind of the Bitcoin space and also now the Ethereum space, obviously for Bitcoin monetary premium is the thing. That is the app of Bitcoin, right? And Ethereum, I think the community has most recently and more recently adopted monetary premium as part of its security defense force. And when we've had Justin Drake and others on the podcast is kind of like maybe less

the fat protocol thesis and more kind of the fat money thesis, which is the idea that if you can create monetary premium in your base layer asset, you essentially get like free security. It's like memetic security for your entire network, for the entire tree trunk and all of the chains that are built on top. And so why not, number one? And then also, secondly, how can other layer ones compete against essentially free security? It gets a chain and an ecosystem with monetary premium. And this is something I think Adams has, you know, Cosmos and Adams being the token of the Cosmos Hub at least, which is just one hub in the mesh network, of course, is not the thing. The Cosmos universe is much larger than just one hub. But in the Cosmos Hub design,

it's been kind of sacrificed. The idea of Adams is not to accrue a monetary premium, but it seems like you're giving that up. What about this tradeoff? Sunny, what do you think? So about getting the free economic security, I actually think that the MES security is actually a non-rent extractive way of getting free economic security. When you're building on top of an L1 that has this monetary premium, there is actually some rent that's being extracted, whether it's like, you know, being forced to pay transaction fees in that token or giving the MEV value to that base layer or while with the app chain system you don't and you use economic relationships to naturally forming economic relationships to provide that security basis. So this might anger some of your listeners, but I remember

I had a tweet a little while ago saying that like hot take, the cosmos ecosystem is a bunch of undercover Bitcoin maxis. And I know you replied to that like, yes, I realized this two years ago. And for me, I actually started building working on Cosmos because I wanted to build the app layer for Bitcoin. I was working on Ethereum stuff for a while. It was at consensus for a little bit. And to me, the monolithic world model didn't make sense. And I was like, okay, wait a second, Bitcoin is an app chain. Maybe we just need to build more app chains and have everything. We can build the app layer for Bitcoin. Bitcoin will just remain the simple chain. And its only purpose is to control the issuance of the Bitcoin system, and then BTC will flow off of the Bitcoin chain and be the main money of the entire Cosmos network that we're building.

I guess I'm a little bit less of a Bitcoin monetary maxi as I used to be, but I would definitely put myself more in that camp. You dabble. You still dabble. Yeah, I dabble. I know. But here's, there's actually a new project that, like, kind of came out of hiding a little bit at Cosmoverse, which I'm really excited about.

It's called Babylon. It's actually a way of using Bitcoin's like monetary premium security layer to provide security to all the Cosmos chains and any proof of stake chain. So what it is is it's a way of checkpointing proof of stake block headers into Bitcoin's proof of work system, augmenting proof of stake security with the proof of work security of Bitcoin. And you kind of actually get a lot of cool benefits with this. You get like proof of stake, really secure in short time frames, fast finality, all that, not really secure in long time frames with whole long range attacks and all this kind of stuff. Proof of work, not very secure

in the short time frames, really secure and long time frames. And if you actually overlay these systems together, you actually get a little bit of the best of both worlds. And so I don't know, I think Babylon is actually in a little way, like bringing back that idea of like using the base monetary premium chain and having it provide security to all of these chains as well. But in this sort of like mesh network paradigm, you know, it's not, it's an opt-in system. It's chains that want to use Babylon can. It's not a like a hard requirement. Before we get to Zaki with the same question, And one other follow up for you, Sunny. So isn't this the problem, though, when we take something like Bitcoin and we port this to

Cosmos is we lose the root economic security of Bitcoin. Now Bitcoin becomes like a lesser secure Bitcoin, the native Bitcoin on the Bitcoin blockchain. So native Bitcoin on the Bitcoin blockchain, of course, is secured by all of the miners, right? It's got Bitcoin level, sovereign-resistant security guarantees. Now when we move Bitcoin to cosmos, now we have to trust. Now we have to trust whatever app chain set of validators for our security of that Bitcoin asset becomes a less secure asset when it's ported in that way because we're not sharing the

security. Isn't this a challenge that you see? Yeah. Getting secure bridges to Bitcoin is definitely an important focus. You know, something that we're definitely want to help promote more of, right? Like we've been trying to help Jeremy Rubin with like getting some of the Opsi TV stuff and like, you know, more secure covenants on Bitcoin, which will allow for more secure bridges effectively. I'm a big fan of the drive chains model. Drive chains is effectively, like, how you would do IBC for Bitcoin. What I've learned is that, like, pushing on Bitcoin development too hard. Like, if you, the more you push at it, the more it's like kind of pushes back at you.

And so we're building for the long term here. And I think the Bitcoin core developers have like a 10 year, 50 year, 20 year mindset, you know. And I think the core primitives that will make Bitcoin be able to securely, have the same trust assumptions as IBC will exist within a few years. Zaki, what's your take on this whole monetary premium thing? Do you think it's much ado about nothing? Do you think monetary premium actually doesn't matter as much as maybe bankless and

kind of the Ethereum and Bitcoin community think it does? I think too many teams who build L1s. So one thing that I think is sort of important to remember about Cosmos is Cosmos is a 2014 project. I started hanging out with Jay. You've been working on it and talking about thinking about Cosmos back since then, it's gone through many names, but basically the core thesis is in the same. We are very long-term builders. We were building the stuff before there was any money in it.

We'll be building it, you know, if the money goes away. It's an idea that seems so correct that it just has to be built. So in that spirit of building for the very long term, I really don't believe in building something that's so fragile that if you like sort of lose the meme, the whole thing collapses, right? Honestly, I admire Ethereum's current monetary premium. I think Vitalik, Justin, Danny have done an extraordinary job. They don't really always listen to me, but, you know. We saw that with Terra a little bit, right? They lost the meme and the entire system collapsed. Exactly, right? So start by building a system that is secure in the absence of a monetary premium. If you happen to also get a monetary premium,

great, you get like this additional security, additional value. You can do things differently with, But if you don't happen to have that and you've still built a sound system, then it'll keep going. And we've seen the flip, the other side of it, which was also built on our tech, which is like, what does it look like when you build a completely unsound system? The minute you lose the meme, everything dies, which was Luna. Let's earmark this question for later. Because since we're on the topic of monetary premium, we'll come back to Adam 2.0 and the new economics that were introduced.

But just really quick, Zach, so we can earmark this for later in the episode. is atom 2.0 increasing the potential for monetary premium of atoms in your mind? Does it make it a better money? It absolutely is. It is part of the vision of Adam 2.8. That's part of the design. It is part of the vision to increase the possibility, increase the probability that Adam may have a monetary premium. That is cool. That makes me as a monetary premium maximalist, which I probably am in addition to a decentralization maximalist, it's cool. to see the Cosmos community doing that. Can I give a little example of the mess security and other justification of it?

Gold is probably the one bare asset in the world that has the most monetary premium right now. It has a market cap of about $11 trillion. The top 10 companies by market cap in the world have a higher market cap than gold combined. And that's the app chain model, right? It's like, oh, value comes from real actual revenue streams and like same way that company market caps come from.

And so if the top 10 companies in the world have a greater market cap than gold, why can't the top 10 app chains have a greater market cap and security system than a monetary premium based security model? So your point there, Sunny, is about like total economic security. And that economic security does not need to come from monetary premium. It can come from a productive asset that is adding value. So like Facebook stock, for example. And like if you have the top 10 companies, then you get market cap exceeding gold. It's interesting. So in this mesh network model of security, what's stopping one chain from just being way more useful and central than the others? And might that chain also beget some network effects and some liquidity premiums? And so while it all starts off as like a pretty diffuse mycelial network that's very horizontal, one chain call it osmosis as like the liquidity center of cosmos.

what's stopping osmosis from kind of just like positioning itself in the very center of everything because everything has to hook into osmosis for liquidity. And then while the cosmos idea, the cosmos ecosystem never actually created like a beacon chain, right? An actual this is the center. What's stopping something like osmosis from basically becoming that anyways? And what in your answer, Sonny, could you just define what osmosis is for people who are not familiar with the cosmos ecosystem? Yeah, sure. Asmosis is a, it's a Dex app chain, right? So currently it's an AMM-based system, but, you know, we're adding more concentrated liquidity-style stuff. And, you know, our goal was to build the best decks possible. And, you know, we looked at, like, other dexes on other ecosystems, whether it's Uniswap or serum. Everything's always, like, constrained with the limitations of the platform it's built on. And we had a lot of ideas about how UX should work, how, like, new functionality. especially around like privacy and like we just were so constrained by building on like you know we actually thought about like building it on an EVM and like this doesn't actually work the things we're trying to do won't

work on here and so by having our own chain that we can go you know especially if you want to do a lot of stuff at the privacy layer right you know we need to go be able to change how the cryptography in the code base works while we also have to change how the wallets work and like you know you have to have this like full stack control and that's sort of what we did so this iBC thing this interblock chain communication protocol that allows Cosmosch change to talk to each other. It had existed for a little while. But then Osmosis sort of came along and like, it was like the first killer app of Cosmos, right? And there are already more, I think, killer apps coming.

And by right now it is sort of where the center of user activity and liquidity has aggregated. You'd say it's the first, but would you exclude Tara Luna just because it blew up? Because that was looking like a killer app a year ago. So Tara Luna was a pretty killer app. They took a little bit longer to activate IBC. So Kara had quite a bit of traction, but they were using the Cosmosis to K-Stack. And then they acted, I mean, I've talked to them about it. They were like, oh, there's no benefit of connecting to the Cosmosis ecosystem, you know,

where they're on the app. And then Osmosis came along and they're like, oh, okay, there's something worth connecting to, which is why they activated IBC. Back to your question about, like, what we're building here is highly organic systems. That's the whole premise of Cosmos is like, you know, you let organic systems arise and you let like, you know, the natural network effects happen and, you know, natural connections will happen. And in any organic system, Hayekian system, you have power laws, right? It is fundamental to the nature of how Hayekian systems work, that there will be power laws.

And, you know, obviously, as an osmosis developer, I intend osmosis to be at a certain end of the spectrum on those power laws. But I think our goal is not to be, we're not trying to build a hub and spoke system, right? I think that would defeat the entire point of what we're trying to do with Cosmosis. That's why Osmosis is contributing heavily to things like mesh security and like a lot of people had asked us like, hey, why aren't you doing routing through osmosis, right? You have all this assets flowing through osmosis. If someone wanted to send a token from region chain to secret network chain, for example, we had the opportunity to allow it to all go flow through osmosis.

But like that's just not the vision for how Cosmosis works. And we like specifically said, no, no, no, no. this whole system is bad. Everything should be doing point to point routing. All chains are the router, the hub, for their own native assets. And so I think that's also kind of why we wanted to build this first app chain as well was so that our team, you know, me and Dave and other folks, we had spent three years building the core stack of, you know, building the SDK and IBC. And at some point, we wanted to go build an application. And by building the application, we can kind of help set how, you know, be the good actor that sets the cultural norms for how.

app chain should be built. So in that answer is the answer, yes, a chain could become the liquidity focal point of the entire cosmos ecosystem, but we will also build surface area and routes around that liquidity center that doesn't like formally instantiate it as a winner. Even though it might be winning, it is not the winner and will never be like locked in there. Is that a summary of your answer? David, doesn't it just feel like uniswap basically on Ethereum? Yeah. Yes. You know, Uniswap has quite a bit of competition. They still make up over 50% of volumes on Ethereum, but like still a free and fair market that like, you know, if Unoswop goes down, Ethereum doesn't die, right? There's so many alternatives that things can flow through as well. I think the difference, though, is that Uniswap is largely a platform for ether liquidity, more than it is uni liquidity. And when there is an absence of a monetary premium asset that's like instantiated or formalized in the cosmos ecosystem, perhaps the osmosis, token becomes that asset, if it is providing its own liquidity to its own asset, and the

osmosis token is the most liquid asset inside of cosmos and starts to become the money of cosmos? I think that's a difference there that's worth poking at a little bit, because then that does start to, like, bake in the osmosis token more formally into the broader cosmos ecosystem than uniswap does for the unitoken, because then the osmosis token starts to fill the role that ether plays in the Ethereum ecosystem. What would you think about this? Yeah, so we did do a little bit of that where like osmo is the base liquidity pair of most of these pools but i actually don't think that's going to be a lasting thing because as we move towards more concentrated liquidity and order book style systems i think the ux kind of demands for stable coins to be the quote

asset for most of these pairs you know people if they're putting concentrated liquidity positions they want to say hey i want to put it between 90 cents and a dollar 10 right not like denominated things in osmos. So another thing, though, is like, we're not just the Cosmos deck. It depends on what you call Cosmos. Like, funny enough, you know, we're actually the second biggest decks for Dot. That is funny. So we have a lot of dot coming over. We have ETH and WBTC are the third and fourth most liquid assets on osmosis. And, you know, we are working on building up connections to more ecosystems. You know, one of our goals is we want to be the place that if you have ETH on Ethereum and you want ABAX on Avalanche, osmosis should be the best place to route it, both from a UX

perspective and liquidity perspective. I don't know if this is true with respect to monetary premiums, but I've always seen the cosmos ecosystem that they sort of import different monies into their kind of trade route network rather than build up their own monies. Maybe things are changing with atoms and kind of the new design, and that's being more conducive to monetary premium. But importing Bitcoin, for example, tokenized version of Bitcoin, importing ETH, now more recently importing USC, which has got to be a big boom to the cosmos community. Zaki, do you have any

thoughts on this? And just in general, how big do you think is the move for Circle and USC to be now supported on Cosmos? Are you kind of a stable coin maximalist? And do you have any issues with this particular staple coin design that it's a bit more centralized, for instance? So, okay, I wanted to make a couple of points that, like, just kind of pop the stack a little bit that like all descend really nicely down this. So one thing that I think is very different about, another thing that's a real difference between Cosmos and Ethereum is that in Cosmos, most of the core devs also work on apps versus in Ethereum, there's like, like, you go to like DevConnect in Amsterdam, and you see this like massive disconnect between like the Ethereum core dev community and the

Ethereum app community. In Cosmos, well-known core devs inside of Cosmos and the people who sort of guide and steward the other core devs who don't want to think about app layer concerns. Almost every one of them has an app. So, like, I have simile finance. I also work on a Goric and a Goric stable coin called ISD. I work on the USC chain or the generalized asset issuance chain that USDC is coming on to. You know, and I helped close the deal in the announcement. And so there's like this whole, like gives this very different feeling to the whole ecosystem and also kind of help solidify this whole, oh, it's going to be a mesh instead of it's going to be. to be like centralized around one thing because we all have our own apps. We all have our own,

you know, economic incentives to like make sure that like different coins in the ecosystem all succeed and thrive. And so we're all constantly constructing different routes and trade routes. And it does sort of preserve this sort of decentralized nature of the ecosystem. Then like go all the way up onto the stable coin thing. In many ways, the way the USDA announcement was structured, I think was, oh, we're coming to a lot of chains. So it's just like, sounds like, okay, we're coming to a lot of chains. But, like, honestly, what I would say is the biggest thing that I have seen from the sort of discussion and conversation with USDA around Cosmo, but coming to Cosmos.

So, like, one of the differences between Cosmos, right, is, like, on all the other chains, except for PolkaDOT that they're launching on, the chain, like, the apps where the chain is going to be used, and the chain where they're issuing are the same. on the Cosmos ecosystem, they are issuing on an interchained secured chain, but with the understanding that the majority of the usage is going to be on DYDX, osmosis, say protocol, like all of these, you know, agoric, all of these things. So what I would say is one of the things that's been exciting to me has been seeing USDC from go from sort of ignoring the multi-chain world and sort of we were,

on the like, they were kind of affiliated with the fat protocol thesis where they're like, we'll go to the fattest protocols, we'll issue USC there to, okay, we get it. It's all multi-chain. We got to like make USDC much more natively multi-chain, which is honestly a challenge for a lot of the bridging protocols. Like when Sunny says, you know, Axolr is the biggest bridge into osmosis, it's almost all stable coin volume. And, you know, we're bringing USDC natively to cosmos. Most wrapped bridge tokens in general are primarily stable. coins going from where they aren't to where they are, and we're much more entering a universe of stable coin ubiquity.

Like, now, you know, if you're building a new L1 and you just build IBC support, you're going to get USDC from Cosmos from the R chain, like seamlessly and permissionlessly, which you could never do before. So I think the circle announcement was kind of underplayed as exactly how it is a big deal it is, because like the literal logical implementation of USDC coming on to Cosmos is now USDC is available to any L1 builder who implements the interblock chain communication protocol, and they get USDC for free. I think that is a big deal.

And I like the idea of USDC on Cosmos more than say something like some kind of a Bitcoin. Because USDC itself is already a centralized. It's an IOU for a dollar in a bank account owned by Coinbase, right? It's not supposed to provide sovereign grade security. It's not a crypto native money at all. And so putting that on Cosmos just seems to make sense. You're not really sacrificing any of the security or any of kind of the sovereignty of the money because it's just already a dollar.

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Nexo, the right place for your crypto. So click the link in the show notes to join over 5 million users who are getting the most out of their crypto. Okay, so I'm going to lay out another question I guess I have for you guys. And this is, again, maybe from a dumb Ethereum Kool-Aid drinker point of view. And you guys tell me where I'm wrong. Kool-Aid passer router. Yeah. Okay.

So layer twos versus cosmos. Let's talk about that. Yes, the future is multi-chain. What people don't necessarily understand is that there are kind of two multi-chains. visions, I think, at play, right? Not to say that both won't coexist. I'm sure they absolutely will coexist. But one is kind of a cosmos multi-chain vision, and the other is maybe an Ethereum

multi-chain vision. And let me lay out the Ethereum kind of multi-chain vision, because I understand that a little bit more. But the basic idea is all of the chains settle back and use the security of Ethereum, right? And so, yes, the Ethereum ecosystem or universe, if you will, will have. app chains and yes app chains are a force. Cosmos is absolutely right in its thesis about this, that app chains are going to be a big deal. I think you guys have led the way and probably the Ethereum community is like, oh yeah, we get it now. Like we understand. App chains big deal, yes.

But the way that the Ethereum community is doing app chains is basically like as part of, maybe call it a layer three as part of kind of a roll-up. So you've got Arbitrum and there any trust strategy. We just had the folks from ZK Sync. Sync. on the podcast last week or a couple weeks ago at the time of people will listen to this. That episode was about essentially spinning up app chains inside of what they called the layer two, which just means basically settled down to Ethereum at the end of the day. So secured by Ethereum. And the benefit of this, you guys are going to emphasize the cost, but let me tell you

what the benefit is of this I see is you get Ethereum's level of security or something close to it with maybe a few minor tradeoffs without having to pay for it. Right. So if you spin up your own sovereign chain, there is a military, there is a security force, the police and the military you have to fund. And those are called the validators of the system. They secure the chain for you. If you're on Ethereum, you settle down to Ethereum, you benefit from Ethereum's economic security. You don't have to pay your own military and police force. And so that has both economic advantages, it seems like you get to preserve much of the sovereignty, though you guys maybe will disagree and say, well, it's not completely,

your own kind of sovereignty in that app chain. But you get those benefits. And then you're kind of tapped into the Ethereum network and the Ethereum community. Cross chain bridging becomes much more secure. You get a lot of benefits from that path. So contrast that, if you will, with the Cosmos app chain model. And tell me where the theorem strategy breaks down. Well, we have a name for that system.

It's called Empires and Colonies. And we're building for sovereign systems. I know, is like, you want to start? Yeah. Okay. I said that was the very memeable version of the put-down. I'll do the a little bit more. So first point is part of like the dialogue between Ethereum and Cosmos, which I think

most people in Ethereum don't really realize this, but this dialogue has been going on since like 2014. One of the co-founders of Cosmos was like an early guest contributor and guest person. Like these have been existence systems that inform each other. And honestly, we've been trying to get convinced Ethereum to like move towards. something like what the current vision is for a very long time. We've been like, okay, guys, yes. Like, we get it.

But, like, you've got to understand the AppChade thing. That has to, like, be part of the vision. And, like, it's taken a long time because, like, they went down this, like, sharding, off ramp. And I was like, what are you doing? Don't go down that off ramp. That's a terrible idea. And, like, there's a couple off ramp.

Yeah, like, plasma, sharding. It took them so long to, like, be like, single slot finality. App Chades. Okay, cool. So they kind of capitulated a little bit, and they came around to the Cosmos Vision. I hung out with Vitaug for like a week earlier this year. I'm like, I finally convinced you. It's taken seven years, but I finally convinced you.

So there is a friendliness always to the Ethereum community. I've always viewed each other as brothers. And in many ways, like, if that world that, like, you're describing of the Ethereum world, the idea of Cosmos will have succeeded, that's why we're all here. That's first of all most. Now, I'll just go to like, what is the specific sort of technical reason? Is in my mind, a blockchain is three things. It's an execution environment. It's a data availability system, and it's a system of bridges. Ethereum is trying to say, hey, basically we want to build one of all of this. There's like one canonical place you bridge to, where you

post your fraud proofs, where you post your zero knowledge proofs. We'll provide one data availability layer called Danksharting, and then you can investigate all the execution environments that you want. The Cosmos vision is, bridge wherever you want. We have IBC. You can bridge anywhere. IBC can enable you to bridge anywhere. Post your zero knowledge proofs and your fraud proofs and everything, wherever you want. You know, Celestia is kind of part of the Cosmos family. It is a data availability-focused app chain, enabling a roll-up type ecosystem, and you can post your stuff there. And then we've given you a free toolkit for building execution environments. And so the differences between the Ethereum ecosystem right now is, one, for the most part, the execution

environment toolkits are not free, which is, I think, a big reason of, you know, why DUIDX, for instance, came to cosmos, and why other chains have come to cosmos is there is an advantage. There is, advantage to being like, hey, like, the execution environment is not the product of some company that, like, raised like a multi-billion dollar evaluation. Zaki with that, is that like, tenderment? Is that kind of the Cosmos SDK? It's just free. It's open source.

Out of the box. It's easy. Yeah. Tendermint, the Cosmos SDK. Our open source, Apache 2 licensed public goods. Got it. You know, collaborated on by many different people where there's many different experts all over the ecosystem who sit and chats with each other and just like work on it and debug it every day.

March of it is funded by the atom holders. But it's like, again, we used the Adam fundraiser, we used the speculative energy around Adam to like build this public good for everyone. So that I think is the biggest difference. I also just think it's actually just the best framework for this. I mean, Robert Leshner treated a couple months ago, he's like, you know, compound chain tried to build an out chain on, I think they just chose the wrong stack. They chose substrate and spent a year bang their head against the walls and gave up.

And like Robert Leshner said, like, hey, I actually think if we chose the costus SDK as the stack to do this on, I think this could have worked. And part of from a builder perspective, I think there's actually just like one of the big things is we can just build faster with the causes SDK than we could with rollups. So in rollups today, you kind of have like two real frameworks right now, it's either everyone's building these like EVM compatible systems. But like I mentioned, you know, the stuff we're trying to do, it doesn't work on the EVM. We need a, we need a custom framework for that. building optimistic roll-ups or ZK roll-ups for really custom state machines is actually really hard. You know, the closest thing right now is Cairo from the Starkware team.

And, you know, it's really impressive what they've been able to do. But writing a dex of the complexity of osmosis, trying to write this in this new programming thing called Cairo that's like very cutting edge, you know, it's like trying to write in like, you know, not even C. It's like a proto C versus, you know, the stuff that we can do in like, go and rust and just like build faster. And I think build the applications and build the Ux framework. So I guess like, you know, maybe one thing is how to compare a lot of this stuff is the Ethereum ecosystem and Cosmos. Yes, maybe they're moving towards the same place right now, the same end goal. The Ethereum ecosystem decided to spend a lot of time focusing on, you know, the things like Doc said, like the fraud proofs and validity proofs, the data availability stuff.

While I think the Cosmos ecosystem has focused much more at a higher layer of the stat. at the state machine stuff. I think the Cosmwasum VM is probably the best designed VM in all of crypto because of how it does interchain composability. The cross-chain composability that we have in Cosmos is way more advanced than anything else. You know, other ecosystems of, yeah, you can bridge tokens, right? In Cosmos, we can have like Dow's on one chain, like do transactions on another chain. So, and I think maybe part of that comes from the, you know, like Zaki mentioned,

that all the core devs of Cosmos are app developers as well. So that kind of informs the decision and priorities that we do. And so that's sort of one of the tradeoff. And no, we will eventually have fraud proofs and validity proofs and all that stuff for Cosmos SDK chains as well. But we're just like, we're going to build a better UX and like app features first. What the difference is is, is cosmos is starting like app down. And Ethereum is almost starting from kind of like base protocol up a bit more.

And so I think a big part of your answer was, hey, the Cosmos SDK is just, badass if you're trying to build a chain. And like there's nothing comparable in the Ethereum community yet. I know we've heard the optimism team talk about, you know, a bedrock, which is kind of their version of creating kind of a, almost like a WordPress for chains. We just kind of, you know, stamp them out. And these would be roll-ups, but layer two out of the box. Yeah, layer two out of the box, but it's certainly not there yet. Roll-ups like to talk about how much, how, like, secure they are and stuff. But if you go to L2B.com, you can see the actual security properties. Oh, we know it. I would say the IBC system right now is actually more secure than most of the roll-ups in practice today.

Well, we also had Vitalikon who was like wondering if we'll ever get to a place in optimistic roll-ups at least where fraud proofs actually work because we're not there yet, right? Although I will say ZK EVMs are looking pretty good from a tech perspective and from that side of things. But yeah, it's very interesting. I guess one comment I want to make and then just a quick question is it does seem like because all of the Cosmos core developers are also app developers, app chain developers, probably from put on your app chain hat, you guys are just willing to use whatever app chain technology is best, right? And right now, that seems to be Cosmos for you. But like, if there was a way to do kind of Cosmos plus settling on Ethereum, you might

decide to migrate your app there. It's just not been the best approach to date, right? The Cosmos community has provided the best app chain tools. One question, though, and this is a throwback maybe to 2017, 2018. And this was, I remember at the time, there were two big interoperability chains because this was the narrative. It was Pocodot and it was Cosmos. You just were talking about a failed attempt from the compound team to actually build something in substrate, the Pokedot tech. Has Cosmos won that war, do you think? Cosmos versus Pocodot is Cosmos ahead? Obviously, you're probably going to say yes, because you're on Team Cosmos, but like, give me some objective reasons for why you think that's true. We have many friends at parody in the Pocodot community. IBC to Pocodot is also being built by a team

called Composable Finance. Another exciting thing just talking about all the ZK progress is ZKIBC has gone from being like, maybe it's like five years away to like maybe it's like a year away. There's like a lot of exciting teams that have kind of come in and started building the building blocks of ZK IBC, which would potentially allow for much more interoperability with Ethereum. So just like kind of talk about all those things. But then like, like get to the heart of your question. PolkaDOT versus Cosmos, which model is winning? Dot market cap wise, dot is winning.

But you heard in the same sentence, like basically the same presentation from Circle. USDC is launching on PolkaDOT. It's launching before it's launching on Cosmos. Absolutely true. Does PolkaDOT have an app that's going to mint a billion dollars of USDC on it? No, right? We have D-YDX. Like when USDC goes live on Cosmos, the floor mint is a billion dollars just to move the

D-Y-D-X user base from Starkware to Cosmos. It's a very hard number. It's a very hard metric. But it's like, this is what happens when you bring the best apps to your ecosystem and you don't collect rent from your app developers. You build an ecosystem into which of collaboration in which they can thrive and we can thrive. You get the best apps. And then as assets and stuff move to the ecosystem, you get these like exponentials of scale that like are not possible in other ecosystems.

What's interesting about that is it feels like Pocodot has maybe done this strategy where they've tried to split the difference between Ethereum and Cosmos. And because they've been in the middle, like the middle just hasn't held. Yeah. It doesn't hold. Yeah, the middle doesn't hold. And so Ethereum is just like, hey, we're an empire, I guess. I don't particularly think they're an evil empire. But an empire nonetheless.

They're not evil. Vitalik's certainly not evil. No one would say that. But like there's some rent extraction. There's all sorts of things, right? I get that. And then... But it's not nearly, it's as, I don't consider it nearly as adversely selective as polka dot because you are getting these enormous network effects from it. Well, but so you have that and it's like, it's kind of like the United States, right? And all of the chains are sort of states within the United States. There's a federalist kind of like notion to it, but Confederacy of States as well. And then you've got Cosmos on the other side, which is just like anarchists. almost. It's not anarchy, but it's almost like, hey, any city-state can spin up. We'll do a network if it's advantageous. We'll do Sparta and Athens. We'll make an alliance, but maybe we won't. Maybe we'll go to war, but maybe we will. It's very loose, but there's no rent collection paid to the kind of the Cosmos hub. Then you have Pocodot, which kind of tried to split the difference

here, where they tried to have kind of the sovereignty of all of these chain experiments, but then they ask the chains to pay rent economically back to dot holders, right? You have to rent out your parochane in the Pocodot network, right? And it just seems like that model has not picked up from an economic perspective. And this is why very much right now in crypto, maybe this has always been the case. I just see these two sides. There's Ethereum on one side and there's Cosmos on the other. And these are the two kind of parallel ideas that are playing out in crypto before us in 2022. Yeah. We've used this metaphor before. Ryan is the one that put this into my brain is that nature has made a crab like 10, 15, 20 different times throughout history and these crabs are

unrelated to each other like on the evolutionary line. And that's just because the crab is a good strategy. And some of the lines I've been using on this like metaphor is that if you re-roll the dice over and over and over again about how the crypto industry forms, you'll get Ethereum every single time. And it also, I think, goes to show with Ryan was just saying, you'll also get Cosmos. It is the central security model of Ethereum versus the app chain model of Cosmos. And that is like the whole thing. Maybe Bitcoiners will be like, oh, and there's also the proof of work money strategy as well. But maybe that's also true.

That's a type of app chain. Yeah, okay, sure. It's an app chain. Right. So it's one of these two flavors. Maybe it's a 50-50 split. Maybe it's an 80-20 split, but it's definitely not 100-0. I definitely will take that into account.

I want to talk about MEV. I want to go down the MEV rabbit hole a little bit because I think that will also help illustrate the incentive for apps to be their own app chain. Sonny, can you talk about the MEV model of Ethereum? And we can use UNISWAP as an example. Dan Ellitzer just put out a fantastic article talking about UNISWAP

and all of the money it makes as revenue versus the money it leaks to the ecosystem. And just like real just to speed run that article, of roughly one-third of the economic energy that goes through Uniswap is captured by liquidity providers, the actual service providers of Uniswap. About one-third goes to gas payments to transact on Uniswap, and one more third goes to MEV payments, front-running, back-running, like, arbitrage opportunities. So there's this application on an Ethereum called Uniswap. And of all the costs, it takes users to use Uniswap. About one-third of that cost goes to profits for liquidity providers.

one third goes to gas payments, which goes to ether holders, and one third goes to MEV bots, which are MEV bots. And so the claim here is that there's leaking a lot of value anytime you use uniswap. So, Sonny, can you talk about this in like the Cosmos perspective and how Cosmos and app chains solve some of these MEV problems and are a less leaky ship when it comes to value capture and value accrual for apps? Yeah, sure. Dan's, that was like a proposal, like, hey, we should build a unichain. And I was like, yeah, we did. It's called osmosis.

And Dan knows this. Nathan is a major investor in osmosis. But so Anatoly from Solana had a tweet a couple months ago at this point, but he basically said, you know, he also doesn't believe in the monetary premium thesis, right? And he actually said that, like, I don't know about the monetary premium stuff. It's a little bit too hand-wavy for me. But the value of L-1s is the MEV that they capture. And like you said, exactly that.

Like, you know, Uniswap is leaking that MEV. value to the base layer of Ethereum, right? For osmosis, you know, as a vertically integrated chain, there's sort of three sources of revenue, right? I could see it. We have our app revenue, which is like, you know, the decks of training fees and all that kind of stuff. There's transaction fee revenue, but my take is actually that transaction fee revenue

should never be a meaningful source of revenue. This is sort of my like concern with the whole EIP 1559, like sound ultrasound money. like thesis is that like what are you paying for with transaction fees you're paying for like block space of a bfd compute system and the point is that like I think that block space and bfd compute systems is going to be cheap in the long front because there's going to be so many chains and even in the Ethereum model as more usage moves onto rollups the demand for base layer of block space will go down massively and like in any world if transaction fees are too low it's not a meaningful source of revenue if they're too high users are not going to use it and

Ethereum had this like two-year period starting two years ago of like, oh, okay, there was really high fees, but users were still using it because there was no real alternatives, right? But especially with roll-ups and app chains and all this new stuff coming there, I don't know if users are going to be willing to pay hundreds of dollars again for transactions. And then we kind of see this, you know, that's why a lot of stuff markets have moved to other chains. You know, NFTs are very popular on, you know, Solana, for example, right? Or games have completely moved off of Ethereum main chain altogether.

The third source of revenue is the MEP. capture, right? And so before we were building a Dex, we actually were just like building like MEV mitigation strategies. And so we were working on something called threshold decryption, which is a way of encrypting the mempool entirely. And so that way, and only decrypting and executing after blocks have been finalized and committed. And so the motto that we follow at osmosis is mitigate bad MEV, internalize good MEV. So where do we draw this distinction? Bad MEV is, MEV is the type of MEV when you are doing actions based off of other people's transactions, right? Because the MMP pool is public, you can read other's transactions and you could sandwich

them, you could generalize front run them, copy their strategies, you can do all this stuff, which is like not cool. Fundamentally, that's a privacy breach. And like, it is a bug that the MMPOOLs are not encrypted right now. So that's why we focus on building threshold decryption so that the M-pools are encrypted, but now there's still some types of M-EV that remain, right? And I call these, like, I don't know if good M-EV is the right word, but it's not extractive M-EV. You're not extracting it from anyone else. So examples would be arbing prices on osmosis relative to centralized exchanges, or even arbing prices within osmosis pools. You know, there are circular routes through pools, arbing those together.

Or there's, you know, the Mars Protocol is launching a lending platform on osmosis quite soon. So, you know, triggering liquidations. is another sort of good MEV. And all of these are good things. You want your pools to be R-R-B. You want liquidations to be happening fast. But there is value in being the person to do that, right? And so how do we internalize good MEV and bring that as protocol of revenue?

We're working very closely with a team called Skip, who's helping us, you know, instead of letting this stuff be run by these off-chain validator cartels, right? You know, I would say like flashbots not being part of the core protocol, it ends up having to be a little bit profit maximizing. when if the beauty of app chains is because your chain understands the semantics of the application built on top of it, it can be opinionated about how it orders transactions or it can do things to actually promote social good, right? We're going to make sure all trades happen first before liquidity removals happen. And like so liquidity can't get rugged from under you or we can like detect sandwiches and like be like, oh, this is an invalid transaction order. We're going to move these transactions around so it's not a sandwich anymore.

And like you can do things like that, right, to help continue to mitigate that bad MavV. And then on the good MEP, we can run automatic on-chain arbots where like, you know, we calculate arb cycles and we run an on-chain arbor that happens at the end of every block and captures that ARB revenue and gives it to Osmos Stakers. Or we could have a top of the block auction, but in the protocol itself. So instead of relying an off-chain system, the in protocol, you can bid to say, hey, I want to be the first transaction in the block, and that way you can be the one to do all the arbs and liquidations and stuff. And doing it in protocol is important because then the protocol can decide how the revenue gets shared, right? If you do it off-chain, you know, the revenue goes to like only the validators. And maybe we'll see a market where validators have to end up start sharing all their revenue with their delegators, right? But if you do it in protocol, we can say, oh, we want some of this MavV revenue to go to all stakers. We want some of it to go to the community pool. We want to give some of it as a kickback to users. We can

like choose what to do with that MEV revenue, which is, I think, a very important property. Yeah, I think that's definitely the strength of the app chain model. As we move kind of this conversation from comparisons to Ethereum and from the Cosmos thesis to the world of the new atom 2.0 economics that were released. Having gone through that paper, there are a few things that stuck out to me. And I'm going to try my attempt at summarizing. But you guys go there and let me know what the main thrust of these changes are. It seems like before Adams, from an economic perspective, the token economics for an investor anyways, weren't really great, kind of sucked, at least did not accrue monetary premium. And Zoc, you're going thumbs

down. How did it suck? Thumbs down in agreement, right? Thumbs down in agreement, right? Yeah, I know. Why did they suck before? This was a big part of our presentation at Cosmoverse, my presentation specifically. It was like, look, you can think of what Adam was foremost in the first iteration was a prototype of a proof of state chain, right? We would say that from our point of view, that our argument is that before the Cosmosub launch, there was no live proof of stake chain that had really taken proof of stake economically seriously and done it in a rigorous way from like the computer science level all the way to the economics level. I believe that Oswald was the first chain to do this,

but it was a prototype of what is proof of stake? look like, how can it be done in a rigorous way, like, all of these things. But it was only a prototype. And like, the best way I would describe it is also is we have an app chain thesis. What the hell is the app of the Cosmos Hub? It doesn't appear to have an app. So, and so, you know, both Ethan and I talked about this, and this has been a big theme of, you know, the last week of our lives. And like the preceding like nine months of pulling all these ideas together have been about, you know, okay, we would like to go out and we would like to say, one, we want to make Adam a better ecosystem asset.

But inherent to that idea is we must create an app for the Cosmos Hub. Why don't know what you kind of take your other, do other takeaways from the paper? Because I'm curious in real time getting like what you took away from it, but I can talk a little bit about. But yes, issuance is changing. We are moving towards not this exponential inflation. we think that helps defy in the ecosystem. We think it makes Adam closer to a monetary asset, like all of those things, and we think

those things are good. That's like first leg of the stool. Let's camp on that because as a monetary maximalist, you'll note that the first thing I noticed in this paper was, hey, the monetary policy has changed. How this is interesting. I almost wondered in the back of my mind if it's like if the Ethereum community kind of capitulated in being like, ah, Cosmos, these app chain guys were right. They were right all along, right?

We're going to do more app chains in Ethereum. I almost saw maybe some recognition from the cosmos community that, huh, this ultrasound money thing, hmm, maybe we want our atom token to actually exhibit some characteristics of money and have a better issuance policy. That's kind of what I saw, but maybe that's my biased reading of the thing. And so what I saw is previously, I think issuance for atom token holders, what was that between like 7 and 20% per year? That was the rate of issuance, new issuance in the market?

It's adaptive to the amount that's staked. So we target a stake rate of 67% because of, you know, we want to keep the, make it very expensive to attack, to like, had further to be enough liquid atom to accumulate to actually attack the network. Right. And so basically, you know, what pulls atoms away from being there are like what's on centralized exchanges that centralized exchanges themselves are not staking. And then all of the atoms that are out there in LP pools, all of that stuff, you know, that pushes the staking. rate down, the inflation weight goes up to compensate. So we had dropped to about 7% inflation new atom issuance. And then since kind of osmosis launched in the IBC ecosystem top, but we've been averaging about 9-ish percent in this PID loop. And that has translated into a

staking APY for atoms of about 19, 20 percent. Gotcha. And now what are the changes? There seem to be almost two phases of these changes, like a transition phase and then almost a steady state. In the first phase, issuance actually increases, I believe, but then in the second phase, it kind of like tapers off and it's going to decrease to like 1%. Could you explain that piece? Yeah, there's a bunch of complicated moving pieces in the issuance thing. A big part of the framework around issuance, though, is that cosmos is taking a very different approach to liquid staking than let's say Ethereum has, where I would say Ethereum fought tooth and nail to make it as hard as possible for like liquid staking to emerge, and it emerged anyways because the economics are so compelling.

The Cosmos ecosystem has been taking an approach of, hey, we want to make sure that there are just a large variety of liquid staking providers and so that there is competition. And so you don't have a situation where a Lido-like entity becomes super dominant. But we think on the whole, like liquid staking, staking derivative assets are actually really important to the security budget of the system. And the logic there is it allows people to stack their yield. So rather than saying atom holders, like we're going to try and like print so many

atoms that we compensate you for the opportunity cost of everything else you could do with Adam. We're saying liquid stake your atom, take your liquid state data, go do all the other things that you could do in defy, go use the app ecosystem with your liquid state atom and have it still contribute to the security budget of the Cosmos. So the first thesis is, so there's like probably about like six liquid staking protocols launching or in the midst of launching on top of in the cosmos ecosystem right now. So there's a lot of activity around that. So we're sort of projecting in the future saying, hey, we think this over the next three years. We expect these protocols will succeed. My team at occlusion has been working really, like one of our big

contributions of the occlusion team to the paper has been that we spent the last like 18 months making changes to the default cosmic staking module to improve the U.S. of liquid staking. So all of that stuff, that's happening. So staking yield starts to fall on like a yearly basis in this. Now, the issuance goes up, but that is issuance to the community treasury. Because a lot of chains have had this idea of having like the on-chain Dow being able to have funds and funds. We started the Cosmos Hub out with a very small amount where there's only about half a percent of new issuance goes into the. And so like we have about 10 million.

dollars, I think, of value in our community pool, whereas, you know, some other L-1s will have, like, a third of their market cap in the community pool to, like, fund new things. And one of the things that we're saying is in this new app vision, to execute on that app vision, you need working capital. Like, we're going to have to go out and do business development. We're going to have to onboard chains onto this interchained security thing. Like, there's going to be a lot of stuff that needs to be done that wasn't really conceived of, in the original Cosmosub.

But like, if you hold Adams, you're going to be a voter on what those funds are being doing. So like the extent to which is dilutive, I think, is a little overplayed. And then we're saying after this three-year period, there's not going to be any more new funding going into the community pool. There's not into the on-chain treasury. And then we're going to drop the staking yield basically to about 1%. That makes sense.

Okay. So that's the economic change for Adams. And like lower issuance is the eventual outcome. That'll take some years to play out. And you also mentioned liquid staking, which I noticed in the paper, making that kind of a first-class citizen, I would say, in the cosmos ecosystem. And the way it's liquid stake is not a first-class citizen in Ethereum. It's kind of an app that a third-party creates. And then I also notice, like, you're posing the questions, Aki, of like, what is the app of the cosmos hub itself? And is the app of the cosmos hub not interchange security? Talk about this. And this, I think, is sort of the idea that you can call on,

on atom validators, Cosmos Hub validators, to also secure your app chain if you want. Is this the case? Is this what interch security means? Yeah. So why don't we talk about two terms? One is mesh security. The other was interchained security. Technical primitives are basically almost identical between them.

They're about translating, staking information and slashing information from one chain to another chain. So like, if you fault on one chain, you get slashed on another chain. let's call interchained security, but like the version in which you replicate the hub validator set. So when we started with this interchained security thing, I was like the biggest skeptic that we would find anyone who cared about it. I was like, anyone who's really serious about building an app will like want to be under their own sovereign chain. Why would anybody else want to do this? And then we found, we found like an enormous amount of customer demand for interchained security that like we call them consumer chains.

So chains that consumed security from the hub, we found so much demand for it. And I'm like, it was like a shock to me. But I've understood now in the past, like, what are the things that interchained security is offering that people get, that is like appealing to people? One category of thing is there are very high value users like USDC, for instance, who want to be able to like launch, be strongly affiliated with the developer community core, the exchange the custodians, the community around Adam, and like do not want to think about tokenomics. Like that's like just not something that they would like really at all want to do.

And so that's like one really strong use case, which is like really powerful use cases that accrue value to the whole ecosystem and accrue value to the Cosmos Hub, but like don't want to think about their own tokenomics at all. Other things are we are building something that's like actually very security sensitive, like liquid staking, where if like you have a major liquid staking provider and it gets taken over, there's like a cascading effect on the security of every other chain that is like running on top of their liquid staking protocol. So those chains have also wanted to affiliate more closely with the Cosmos Hub. And then there's the sense of, hey, I want to be able to build like and really target

just like the network effects around Adam, the wide holder base, all of that stuff. These are three teams that we see popping up over and over again. And frankly, this, like, again, has finally given us a sense of what is the purpose of the cosmos hub, which is to enable these things to succeed. I guess another thing I noticed was something that you guys are doing with MEV. Can I add one more thing about the hub and how it relates in the mesh security vision? Yeah, yeah. Go ahead. Do that first. So I taught a class on Switzerland at UC Berkeley. It's my favorite country in the world. You taught a class on Switzerland, on the subject of Switzerland. Yes. Eight lectures, talked about history, politics, economics, like everything. It's all on my website. The famously very neutral

country. Yes. So how did Switzerland become, it's one of the richest countries in the world, right? And there's many things that went into that, right? I think the role of its credible neutrality that it's played throughout history was very important. One thing that people maybe don't realize is that Switzerland, it's neutral, but it actually had one of the best militaries in the world. And even until today, it actually is one of the best militaries in the world. But from like, you know, period of like 1,200 until like Napoleon basically, they were like Europe's mercenaries. They were the best most like respected military in all of Europe. But because they were neutral, they acted as mercenaries and went and like defended whoever would pay for them. And I see the role of the

Cosmos Hub to be this credibly neutral system that is a, you pay it for security and you get this like amazing economic security from it. So it's a military for hire. Military for hire. It's like, you know, you don't want to have to come up with your own military. Well, you know, you can pay the Kosovo. And you'll, that that's the role I feel that it plays in this mesh security vision. So the idea here is that app chains, maybe at Genesis don't do this because they're at Genesis. But then their product market fit happens. Their utility is proven out. Their value increases. And then they can start to be, hey, you know what? We can afford security. And so then they start to tap into this like credibly neutral army. which thing can secure them. I would say it's almost the other direction. I'll just say one of the things that is like really cool and I think unique about our vision of shared security is we have specced out the whole system to the extent where you can seamlessly, like just through like the standard kind of upgrading application upgrading process that we use in Cosmos, both join interchained security without disrupting your IBC connections or anything or leave interchained security. So, you know, communities, it's not like they've like, if they like find the hub excessively value extractive for the security that it provides, it'll be very possible to leave.

It'll be possible to go join someone else's shared security environment too. Or like be your own sovereign app chain. Again, this is like a long-term commitment. We're creating market forces in cosmos that ensure that this is a pluralist environment and that, like, we are not creating any sort of artificial rent seeking. Like the hub has to really provide its value. Otherwise, no one will do this. Okay.

Sonny, did you want to ask something? You were asking about the MEV thing. So let me just cover the MEV thing. Because the MEV has been like MEV censorship, all of these things, hugely relevant to the Ethereum community. We've heard a little bit about what does MEV look like in the pure app chain thesis. But one of the things that we, you know, I've talked a lot about with the MV, you know, FlashBots teams. We also have very good MEV teams inside of Cosmos, Skip and Mechetech, who are doing also, like, building, you know, businesses around MEV in the Cosmos. And one of the things that, like, is built into it is, again, we don't think transaction fees will ever be high.

Like, we don't think transaction fees will be a meaningful amount of revenue. But in a world where there's, like, Adam, USDC, other assets that are major fiat or on ramps between Cosmo, into the cosmos ecosystem, at least one hop of every economic sort of loop or economic activity will frequently start within what's they call it the atom economic zone, the interchange secured area of atom will probably be a place where a lot of economic activity originates. And the ability to sort of arbitrage that, so statistical arbitrage of not sandwiching or anything, but just knowing, hey, someone is minted a whole bunch of USDA, and we see them issuing an IBC packet, that kind of information is likely to be valuable,

that block space is likely to be valuable. So one of the things that we're proposing in the Hub 2.0 white paper is that one of the, again, applications on the hub is this block space market that any chain in the ecosystem, whether it's interchained secured or not, can opt into participating with and say, we're actually going to package a product that is like a better product than like what's Skip and Mechatech could build right now, which is the guaranteed ability to, like, have a transaction at the top of the block across many blocks over some contiguous period of time, and that the hub is a natural place to, like, hold this auction and execute blocks. So right now, Cosmos, the Adam token, is coming in at 23 on Coin Gecko, the total coin market

cap. And it's kind of behind some tokens that I'd never really would expect it to be behind, like light coin. Is this still behind Ripple? A lot of tokens are sadly behind Ripple. Lightcoin is the one that comes to mine. It's right before it at 22. It doesn't make any sense to me because it's like coin. All it's got is Lindy.

Do you guys envision that Adam actually enters the top 10 crypto assets in the future as some given amount of time? If that doesn't happen, I will have considered that like the work that I've been doing will not have been a success. I believe that this work that went into Adam 2.0 when executed creates a top 10 asset. and if the market doesn't agree with me as an entrepreneur, it's like you go out, you bring your best ideas to the market, the market punches you in the face. And so we'll see, I would say that is up explicitly my goal, this added 2.0. Sunny, any thoughts? I'll admit, I'm not as focused on the atom side of things. I focus on the cosmos level at the vision, and then, you know, I'm very focused on the osmosis chain. Osmosis, we're trying to build the decentralized version of

finance. Finance is a top 10 asset. I think Osmo will be one day, too. Zach, the Ethereum ecosystem and community, like, largely on the page of like, yeah, we're going to flip Bitcoin one day. Is there a part of Cosmos that's like Adam is going to flip ETH one day? I can always tell you why, Felix, I can't. I have become really probably more despondent about Bitcoin's long-term future than I ever have been. I own more ETH today than I've ever owned in the past. I own much more Adam, but I own more ETH than I've ever owned before. I own more ETH than Bitcoin.

I think Ethereum is doing a great job. And like deserves, is like the better representative of the cryptocurrency community, the values that I believe in. And I feel more aligned with Ethereum than in the past. I'm not building with like, oh, I have to flip ETH. I need to flip all of the shit that is between me and ETH. Or is slow to do that. Guys, this has been a lot of fun. really feel like listeners at the end of this episode will understand the cosmos ecosystem so much

more, including how it's going to evolve in the future. And what's so interesting to me is these two communities, Ethereum and Cosmos, is like you see Ethereum veering towards Cosmos, right? Getting more into App Chains and this sort of thing. You also see in places Cosmos veering more towards Ethereum, at least with atoms and kind of monetary policy improvements. And, you know, it's interesting to see these two communities. One thing I've respected out of both, they are both the community of builders. Like, Cosmos is building a lot, and it's hard to be bearish on builder activity.

When you get 1,500 people at a conference in a bear market, and you know they're there because they think they're building something cool, that is special, and that is certainly something to watch. So we're definitely watching it at Bankless. I guess last question for you both. So let's fast forward, you know, five years into the future, 10 years into the future. Where do you think Cosmos ends up?

what does crypto look like and what does the cosmos ecosystem look like, maybe five years into the future or 10 years from the future, just any point in time where you feel like the vision is fulfilled. Zaki, over to you. My expectation is that by the time the vision is fulfilled, most people who use cryptocurrency-based technologies will kind of not really know whether or not they're using a cosmos thing and Ethereum thing and a salon a thing.

And hopefully what I want is them just to have used, we use a thing where they are not being exploited. This comes down to the question, I think, which, you know, I have a good way of articulating now. Digital markets in the future will be all markets, and I'm building for a future in which digital markets are open source public goods. That's, like, flat out what I've tried to accomplish. I don't really care about anything else. I just view the tools we've built as Cosmos as an essential part of getting there. I also think Ethereum largely shares this vision, and so feel very aligned with Ethereum.

So if we're successful, we will have open source digital markets that provide economic coordination for the entire human race. And it like works, you know, and no one is exploiting or extracting retic because you can't. And that is the utopia. Open source digital markets. That's Zaki's Utopia. What's yours, Sunny? Mine is, you know, like I mentioned, I really love organic, Hayekian systems.

And I think that like rebuilding the infrastructures of society away from these like very top-down organized systems to like bottom up localized systems where, you know, people make bilateral treaties, multilateral treaties, build communities and it's meshes all the way up, right? And I really believe in ideas like web of trust-based systems, you know, I started working on one of the reasons I started working on Cosmos was I just thought that I really wanted to work on proof of stake. And I was working on that. I thought the Cosm team was the most farthest along on proof of stake, actually. And so now that like as of last month or two weeks ago, over 50% of market cap is. running on proof of stake. I'm like, that's awesome. But now what's like the next thing? I think

there's things we can do even better than proof of state. I really believe there's like a world where we can build like a web of trust-based consensus protocol that will actually be even more decentralized than proof of stake. And I think there's like, I don't know, I just want to keep tearing down like centralized or even high levels of communication required systems and build more organic mesh systems. So at Bankless, we use the metaphor of exploring the frontier quite frequently. And the Cosmos name actually is very conducive to this. So say a listener is listened to this and they're on board and they want to go explore the Cosmos. In Ethereum, we have like Metamask. You've got to have Metamask. What's like the Metamask of Cosmos or just like what are the

tools that listeners should probably start with in order to go explore Cosmos? You should go get a Kepler wallet, which is actually built by our team, but you go on a centralized exchange by Adam, which is the, you know, entry point into cosmos today, you IBC it to osmosis, do a swap for a token called Stars, you IBC it to Stargaze and go buy your first Bad Kids NFT. That's your onboarding path. That's your to-do list. Yeah. I think if you just look at that, okay, you've got like an NFT app, an onboarding place, a Dex, and just use that experience and say, hey, is this, how different does this feel from Ethereum, but then go look at how much you spent on gas. And we're getting it better.

Right now, each of those steps requires a click and a signature. Yeah. At least on osmosis, our view is that every click loses half of our users. And so we're working on a lot of the tooling to like make that entire process feel like one click. Guys, what we'll do is after the show before this is actually published. So by the time you're listening to this bankless listener, we will have a little tutorial for everything Sunny just said that we can link to on the bankless website. So you could see Sunny and Zaki's ideas and how to get started with Cosmos and start exploring the Cosmos. Guys, this has been a lot of fun. Thank you so much for joining us. Thanks, guys.

Thank you. Action items for you, bankless listeners. The first is we'll include a link to the Cosmos, Adam 2.0 white paper. Check that out. Also referenced was the inevitability of Unichane, an article by Dan Ellitzer. And of course, we'll include a link that I just mentioned to that tactic on how to get started with Cosmos. Crypto is risky. You can lose what you put in, but we're heading west. This is the frontier. It isn't for everyone, but we're glad you're with us. on the Banquist journey. Thanks a lot.