Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Evgeny Yurtaev: Zerion - Web3 Wallet UX 2.0

Episode Date: October 13, 2023

One of the best known memes in crypto is: 'Not your keys, not your coins'. This usually resurfaces whenever a (custodial) centralised exchange is hacked or goes bust altogether. Although Web3 provides the infrastructure for self custody, this often shares the fate of Pandora. Self-custody requires increased security measures, from both end-users, as well as application developers. Web3 wallets are the interface between users and decentralised applications deployed on blockchains. While Metamask still maintains the largest market share, a multitude of wallets have emerged, promising additional features and a better UX.We were joined by Evgeny Yurtaev, co-founder & CEO of Zerion, to discuss the challenges of building a Web3 wallet and how Zerion aims to improve user experience, while still maintaining security.Topics covered in this episode:Evgeny’s backgroundThe motivation behind building a Web3 walletZerion UX and securitySeed phrase storingZerion user profileChallenges in building a new wallet appProtecting users and potential attack vectorsSupported blockchains and (seamless) bridgingAccount abstraction and MPCBusiness models for Web3 walletsEpisode links:Evgeny Yurtaev on TwitterZerion on TwitterThis episode is hosted by Friederike Ernst. Show notes and listening options: epicenter.tv/517

This is Epicenter, episode 517 with guest, Evgeny Yotav. Welcome to Epicenter, the show which talks about the technologies, projects, and people driving decentralization in the blockchain revolution. I'm Frederica Ernst, and today I'm speaking with Afgeny, who is the co-founder and CEO of Xerion, which is a well-known Web3 wallet. Evgeny, welcome. Thanks, Frederica. It's really a pleasure to be here. It's the possible. It's the possible. because I've been known I've known for a while so I'm super happy to be here

and yeah thanks for posting cool so you know about us but what about you? Tell us about yourself. What's your background? Sure. So as mentioned already,

I'm in Guinea I've been in the crypto space since roughly forever I would say like since the yeah like my first interaction was like very early on in 2015 or even earlier than that. But I really, really got into crypto after the white paper for Ethereum, to be quite honest.

I still remember the day when I was on the subway just like scrolling through the internet and I came across the white paper and I just read it through it. It blew my mind. So that's how I got into like the whole space. Basically since then I've been committed to working in Web3, even though it wasn't called Web3 back in the day. And yeah, before that, I was still studying at that moment. I was studying computer science.

That's my background. I'm an engineer by education and like my first adventures. But honestly, in like in my spirit, I'm an entrepreneur. So I've been working on my own projects basically since high school. And I started like various mobile apps, chatbots. some of them with a variable level of success. I think the most interesting one was actually already in the crypto space. That's before Xeroon was an app called Cryptotrater.

It had over a million downloads with like three, like zero marketing efforts or anything. It was just for tracking whatever price was. And I built it for myself and it just scaled to many people liked it. And before that, I worked. This is how I actually found my co-founder. I was building mobile applications with like a venture studio in Moscow. So that's the background. Cool.

When you were on the subway, reading the Ethereum white paper, what was it exactly that appeared? Kind of the technology itself or kind of the idea of what it could empower in the long run? Yeah. So this is, I think, a fairly typical story for anyone living. in a third world country. So when the financial system, basically like after the Soviet Union collapsed, obviously Russia took a capitalist approach,

but the financial system was not nearly as stable as it was in Europe, for example, or in the US. And first, I was intrigued by the idea of programmable money. This is like first when I read about business. Bitcoin, but as an engineer myself, I was not convinced fully, I would say, that this is going to be, you know, I kind of liked it. I started reading about the nature of currency, the nature of money, how it all works, why is the currency in my country collapsing and in others it doesn't why the stock market behaves, but like the way it behaves. So this got my interest, but really,

really got excited when I understood that you could leverage the technology of blockchain to extend that to essentially programmable trust. So it's not just about money anymore. And if we can't have this shared trust layer, which is the Ethereum computer, this is where I was sold, basically. And yeah, I think there were a lot of other really forward-looking ideas in the white paper, many of which were, I guess, took years and years to realize. But I think the main proposition was, yeah, changing, like changing the rules, basically and where this whole thing is headed. Yeah, absolutely.

So after the success of crypto trader, you guys started Serrion together. What was the motivation behind, I mean, basically even back then, there were a multitude of wallets, right? So kind of what was the motivation behind starting yet another wallet? Yeah. So I think it's fair to kind of took a little bit of der out here and talk about Zeran's evolution. So Zerian was, Zerian is a wallet only for the last year and a half roughly. And all the time before that Zirian was kind of three different companies. So we really started with even like you can call with the Spartan.

contract development studio. So we were helping other companies and with ideas who knew what they want to build on top of Ethereum, just realized their things. And later, I think like the first, really the story where of Zeran itself starts with portfolio tracking when we decided that we actually didn't want to build a wallet. There were so many already, like there were quite a few wallets. The space was pretty much starting to be filled with a magnitude of tokens and that People really need tools for them to keep track of stuff that is happening, what they have even in their wallet. And this is, by the way, still a big issue for the existing big wallets. I don't have to call them out here.

And we started with that mission to track basically everything that happens on chain, such that the users don't have to worry about it. And they have control, because control means safety. And this is how we got our first user base. So people were coming to Zer and just to see what they have. really have in the portfolio what kind of transactions they were making. And that's been fairly successful, and this is how we got started. But what we realized over time is that defy is becoming a big thing. And it's now much easier than ever because of this access to decentralized trust in a way.

We could just integrate Uniswap without even like going and talking to Uniswap. And people could start leveraging that within our interface. And we soon noticed that basically the users who are transacting using Xerian, they are our, you can call like super fat. So they just love the experience. They love the UI. They love the combination of the portfolio tracking with the transacting part. And we kind of, we dives into this path and we started doing more and more integrations. We were the first ever integration of Uniswap.

I think the first integration of MakerDAO, the first integration of Compound V2. and like a few other prodigables. So really, really early in the defy journey. And eventually this whole, I guess, pathway led us to realizing that this is time when we are ready to start our own wallet. Because the existing wallets were still lagging behind in terms of the, I guess, the data capabilities. So in the U.X in general. So UX, I think in crypto in a big way, is build on top of good data and like fast. yeah, like a fast understanding what was in your wallet to make good decisions, to sign transactions

in a safer way to exactly know, like, how connecting to DAPs and et cetera, et cetera, so all that requires good information. And we had that for a while now. And we decided that the wallet should have it all. And yeah, that was the whole motivation behind moving into the wallet space eventually. I think I kind of see it as like the end game for Zerian. We were thinking of doing a wallet for a very, very long time. We always like postpone that and like it's much harder to compete. It's harder to monetize, et cetera, et cetera. But yeah, I feel like we're ready now. And yeah, lastly, I think what was important to mention here, a very long time ago, I think it was like 2017. We even had an attempt at wallet. We didn't put too much effort into. We didn't put too much effort

into it, but it was called tokenary. It was one of the, it was built by one of our engineers, basically like a, kind of like a sister company or a spinoff from Zirin. And it was called tokenari, so that was like very, very simple wallet. It was built using the kind of telegram principle of removing all the clutter, just keeping focus on one single wallet, just the tokens and signing transactions. That's it. It was a cool thing. We still had, we still have users on that, but we're not really doing anything anymore, but this, obviously, now Zerian is the main thing. Okay, maybe let's talk about kind of how Zerion handles for the user.

And then we can kind of talk about kind of the spectrum of wallets and kind of what they do for UX and kind of what you guys plan to do for UX, because obviously it's, I mean, it's super apparent that user experience for wallet has to greatly improve for this to kind of see any. mainstream adoption. So kind of talk us through, if I go to zaryon.io now and want to create a wallet, how do you guys do that for me? Where are the keys? How do I safe keep them? Yeah. So I think the best experience would be on mobile still. So we are in the process of releasing. So for our web users, we are in the process of releasing the extension. So this is happening already. We're going to go public life in about a month from now.

So we're pretty much gearing for that and excited for this launch. We still, we already have over 10,000 beta users of the extension. But yeah, that would be the milestone. Majority of our users of the wallet are on mobile. And the way it works is a very classic non-custodial wallet. So you come, you create a seat price. We'll guide you through how you should recover that. we were obviously thinking about other ways of custody, but I think for us, the main reason

why we wanted to keep it very simple is that first, we do rely a lot on composability, so daps have to work for the world to be useful. And second, we wanted to, you can go like a vampire attack on Metamask. We want users to migrate over, and we still have a pretty big chunk of users just moving their seed phrase from MetaMask to Zerian. And yeah, the seed phrase just stays on the device. And we obviously don't have access to it. You can bag it up in iCloud if you want. And yeah, that's about it in terms of just creating a wallet.

So it's very simple, just a few taps. Yeah. And in terms of the experience, I guess what you get is the DAP browser that works. So you can connect to any DAP and you can sign transactions. You can connect to pretty much any network out there. So we support, fully support in terms of data capabilities, we support about 10 chains. And the rest, you can just add any custom RPC and start signing transactions. We do check every transaction before it's sent by simulating it and giving you what is going to

happen as a result of this transaction. I know that the SAFE does that too. And like good, better wallets are doing that now, so that's good. And we obviously check the domain names for fishing and basically doing all. all kinds of security checks in the moment of transactions. And we plan to add more and more stuff on the security of basically interacting with the blockchains. Okay.

We'll dive into that in just a bit. Let's kind of just remain on the seed phrase for now. So I assume the seed phrase is in some sort of secure enclave in your phone, right? When you say you can back it up to iCloud, can you also just write it down, kind of pen and paper or do you never get to see it? You obviously can, yes. So that would be the default way for most people who know how to handle the seed phrases. But baking it up to iCloud is still, it's kind of an easy way for you to, for someone

who is not too experienced with crypto but still want to give it a goal to not lose the key if, for example, their device is stolen or lost. case, they might have forgotten to back it up using like a paper and a pen. And in that case, they could just using their Apple ID or Google account. And plus, like, their biometrics, they can restore access to the seed phrase. So basically, the seam phrase is not stored in the open way in I cloud or Google Drive. It's encrypted with your biometrics and stored. So basically, if you lose both your, I guess, a pin to the phone and your phone, that's when you actually lose the other key.

Yeah, but in other cases, it saves from, like, the most common way of losing a seed phrase is when you forgot to back it up. So, yeah, that's where we are. It doesn't obviously protect from the leakage of the seed phrase. So if you've written down some seed phrases, that's the biggest concern. So if you write it down somewhere and someone finds out your seat, money is gone. And obviously there are ways to prevent from that, but that requires using completely different stack of custody. And yeah, I think next year would probably be when that gets

more and more adoption. Who are your users? So basically, if you kind of look at financial applications, there are typically kind of users who are kind of happy to use their phones for stuff. But at some point, kind of at some level of whaleness, this stops, right? You're not going to make a $1 million transaction from your phone. People just have an aversion to that. So kind of who is your user base? Actually, that's a good question. So yeah, I have two things on this.

So speaking of the user base, it starts with, obviously we're not focused on a whale type of user. So if you really want to store a lot of money, Azerian is not the, right now at least is not the place where you should be doing that. So Zyrian is primarily for your, I would call it like a public on-chain identity. So if you want to mint NFTs, if you want to quickly sign into something on a conference, if you are trying to, I don't know, like buy some random token or mint a sound on sound X, or mint a post on mirror. So these types of actions, whether that's collecting or like buying some random tokens in small

amounts just to play around, testing new stuff, new daps, new protocols, games, whatever that is. That's where we shine, really. And Xerian was meant for users who are doing a lot of transactions. So that's kind of opposed to what ledger is meant to be or maybe safe, like, I mean, Gnosis safe where you keep a lot of funds and you try not to touch them, but when you do, you do it very carefully. So that would be the use case for a ledger. And that's why, like, obviously, ledger is not convenient. You need to carry it around, like, flagging. And obviously,

like, you won't do that in like a minute. In Zeran, you can just, like, pull it up, scan up your code or admin stuff or, like, test out a new data on the go. So that's the main use case. And the second thing I wanted to add is I think in the future, it would still work really nicely with these types of use cases. And for that, it's just a little, a bit more time is required. So obviously, the safe integration on the Zirian end could be one of the solutions where you could initiate transactions from the phone. And there's not going to be any security concerns because you have a second key where, or like you have a friend who would need to confirm a transaction. And even with the ledger, we have some users who are using Xerian mobile experience with the ledger,

and soon they'll be able to do that with the extension. So it's kind of like an interface, so you don't have to worry about the key being leaked in any way. Or, yeah, you can keep as much fun as you want, obviously, on these types of bullets. So we kind of separate the wallet experience from custody. And currently our custody works for these, like, smaller type of, like amounts of money, but a much broader set of use cases. Have you looked at kind of second signers and so on that kind of connect with NFC? Because kind of, you know, being mobile first, that sort of, you know, a low-hanging fruit, no?

We did. And by then you mean like kind of like a Ubiki like NFC something to confirm a transaction. Yeah, like a tangent card or something. Yes. The issue with all of that. So it all sounds great and I would really love to have something like that. And I've seen, tested the numerous cards that you need to tap to, like, confirm transactions. I even, like, I have an NFC ring that I'm using for payment.

So I'm a big nerd for these types of things. But I think when it comes to more mass adoption, this is logistics. It's expensive. So basically, if we have this much user base, like only, whatever, 10%, tops would be willing to pay for it, reveal their address. Like they're like levels and levels of considerations that we need to take care of before using that specific solution that never really took off. So I think our way is honestly software rather than hardware when it comes to adoption.

So making things cheaper and making them, making them more available through existing technology. And that's why, for example, account abstraction to me is. is more, I guess, a reliable way to progress with the UX and also like the new signature. So if we can reuse the signature from existing hardware devices, which could basically, like they're not currently compatible with Ethereum signatures, but if we can make using counterfection them compatible, then we can leverage existing hardware in the phone. And we don't have to even have a ledger. So I think that's the best pathway forward.

And yeah, for like all the mass adoption. Cool. So I understand that kind of the users that use Serion currently are kind of like people who go to events who kind of want to try out different apps, kind of have spending money just kind of like on a low barrier to entry mobile app. What are your intended users? because kind of that's as a market, that's a very constrained set of people, right? Yeah, I think it's constrained right now, but I'm a big proponent of the growth of the Web3 user base.

And we define our users as Web3 citizens, and we've been pretty vocal about that. And I still feel pretty strongly that we don't really have to change that. I know that a lot of people are talking about onboarding, you know, the newbies, billions of users to Web3. But to me, I think it should grow from within. It should grow from the Web3 citizens themselves. And we really want to support the use cases that are actually working and useful in Web3. And that's why we want to kind of what we're focusing on what people are doing now in Web3. because that kind of gives us early hints

of what could be useful for the rest of the market when the time comes. So yeah, I don't think, I don't really believe in us kind of deciding, like someone finding out randomly that this is what people would want. And I think the UX of the wallet is, no matter how bad it is, we need to find the use cases within the Web 3 space

that would attract people. And once we have that, and I hope we won't miss it, that. So as these narratives are created within the Web3 ecosystem and Zeran supports them, then all the new users who are going to come to Web3

and become Web3 citizens, they would be the ones, like they would try to look up to all the Web3 citizens who were there and they would be coming for the use cases that we've developed. So that's my point of view. So I'm not like, again, a big believer in copying something and just putting on Web3

and making it like look like it's webbed to it because why? Like it's the same, but just more expensive. And users would probably come for maybe some incentives, but that's it. They would just leave next day. Okay. Then maybe looking at the wallet as it is now,

not kind of at the user experience as you wanted to develop in the future. What are the challenges of building a wallet? So I assume there's kind of like you need to run archival nodes and have like databases and so on for several, chains, but work us through the details. Well, there's quite a few, and that really depends on what kind of wallet we're talking about. So, first of all, none of the, I guess, like very, very few will let's run archive notes, just on even notes.

Even though we do a lot of focus on the data, we don't run our own notes because this is like someone else's business. They do that better. For us, I think that speaking from like the product perspective, I think the biggest challenge is really understanding what's key to have on the wallet level versus what should live on the dapped level. And that's the balance. And I think every wallet is really going through that.

So some bullets were like, okay, we have to do things a very, very certain way. Like this is the only way you can do stuff. These are the only dappes you can access and being very restrictive. there are wallets that are completely kind of removed from your experience and they just say, okay, that's the key, everything else is like up to you. I think Mata Mask is probably on that kind of

that spectrum. So they don't really make any decisions for the user. They don't try to help the user do the right decisions at all. I think we sit somewhere in the middle. So we're being more pragmatic, I would say, about it. So we know that spam, for example, is a big problem. So we do work on our end to remove

move spam because this leads to fishing, at least to people losing funds. Same goes to anything when it comes to like signing off the transaction. We want by default to have protection for our users. So stuff like that is where we take a stance, but we don't want to limit the user. And that's another reason I've mentioned already. We wanted to go with sea phrases because we want users to be able to access a wider range of things. So whatever that they want two-axis, we want to buy off that. Yeah, and I think that's on the product level. From, I guess, the business angle, obviously is monetization.

We will talk about that, I guess, later. But, yeah, monetization is obviously, has been a pain for most of the votes, with an exception, I think, of one. Or maybe two, okay, to Ledger. We can count Ledger in MetaMask as the ones who were not struggling, really with monetization. And lastly, I think on the intro side, I don't think it's a really hard thing, like a challenge.

It's more of hard work that we need to put it into that. But I hope that pays off. So if you think about kind of the decisions you make for the user, so kind of what daps to display in your wallet, for instance, what's the approval process? And kind of if I'm a area on user, can I make sure that these are, are kind of audited or trusted or that there's at least so-and-so-much TVL that kind of hasn't been

so. I mean, what are my assurances? That's a good question. We actually, on the DAPL side, we don't do any kind of restrictions. So you can access, it's more like a Google-like interface, and this is where we're different from, I guess, majority of OSW, which run like a mini marketplace of the approved DAPs. We decided against that for the sake of openness. And basically, we don't really want to recommend any particular data. So usually users would come within the intention in mind of what exactly they should do. And we provide that with that.

What we do, though, to help users kind of make slightly, like basically not to go to a different union swap, maybe mistype. We have a small blue checkmark. So if they start typing uni, a few options would show up, and Uniswap would have a blue checkmark. But that's just a list that we maintain optomy name associations, and that's a pretty exhaustive list of non-spammy, non-fishing daps. Yeah, we don't have a process for this one, so it's currently just managed internally. We used to have, so for the tokens, we do the same, but the process they're a little different. So we are relying on token lists. So token list is like a decentralized effort for curating legit tokens.

So we rely on that. With DAPs, there's no such thing as far as I understand right now. We would want to have that if that's available. And honestly, we don't want to make these decisions for the user. That's something that we think users should be on their own when making stuff like that. how do you think about kind of the attack factors that kind of come with being a front end to kind of other people's smart contracts

right so basically if your front end were to be hacked your users could be kind of siphoned off by malicious sites and so on so what kind of security do you have in place for that yeah this is I think a very this is somewhat of a more soul problem in a way. So that's not novel. It's something that every

startup is running into that runs any kind of front-end. So I think it's first of all, it's a little, yeah, it's a smaller problem. And that just takes good hygiene in terms of cybersecurity. Yeah, and we just do testing of our own infrastructure. We've employed

white hackers to poke around and like try to find stuff. The attack vector is still fairly limited because it's basically we only need to safeguard the deployment of this new up, like the new versions of the front end. And the biggest risk obviously is where the keys are stored. So deployment of extension, deployment of mobile apps. And that, a big portion of that security is on the Apple and Google side. So they help you not to make like, basically, if there's a deployment happening, we would all see that.

and it's a fairly removed risk. I think for us, where we did pay out bounties, for example, were you can call them like informational attacks. So I still remember like one big case where we had to pay, it was like $40,000 or something were lost. And that was because someone created a fake balancer pool that looked like a regular balancer pool and they faked that pool,

to look like it has a lot of TVL. So it showed up in Syria and people were like, okay, this is like a legit, they thought it's a legit pool because it has a certain amount of TVL. And we didn't check the factory contract that was created, creating that. Since then, we've started doing that, but that was a bug that we didn't anticipate.

So it was put up on the front page with like high TVL. Someone put somebody that lost it. So we assume that this is our mistake, even though obviously it's, you have to verify everything. but we didn't mean to show this pool anyway. So, yeah, these are some learnings. We didn't go through like a massive breach of security. And for us, I think, like not sending a seed phrase somewhere where it shouldn't be.

That would be the only thing we should worry about, really. And for that, we just always do the audits. I think it's been, yeah, like six, seven already. And we keep doing that. that's going to be a big expense. Another attack vector is kind of having transactions you can't read, right? So basically human readable transaction code rather than kind of like the ABI that you kind of get.

How do you feel about that? Because it's a difficult problem to solve kind of generally. But if you don't know what you're signing as a user, it's really difficult, right? Yeah. So for that, I think what really works, I would say well, is the simulations. So that's been getting implemented across the board. So I think it started with a few extra extensions that you need to run in parallel with like whatever Metamask. But now it's integrated in Xerian, obviously, in the Coinbase wallet and save.

So I think that saves you and kind of allows you to do a quick check of what is actually happening. it's still not perfect because sometimes the DAPS would be asking you some signature that is, you don't have any idea what can happen. You have to have a more, yeah, I guess like a secure set up, so you understand where this signature can be applied. But I think this is going to be solved over time as well. So we do for specific signatures, when you are issuing a permit for some contract to spend your USDC or something else,

we would also recognize that and show you in the human readable way that some app is trying to spend this much money is it something that you really want to be doing or or not and yeah simulation I think really really helps so if you weren't your intention was to mint an nfti if this is what you see as a result of simulation then most likely that's that's correct I think in future this is even kind of better than in in the web two world so in web two world so in web two world you just plug in your credit card and you leverage the trust network of all the POS connected to Visa

and they do all this fraud prevention if they see something if you but you have to rely on someone else doing the job of verifying that you are actually doing something legit and not every transaction supports like 3D security with cards so in crypto you can have

basically deterministic outcome of the transaction in most cases, so you could see exactly what's happening. I think the security when it comes to signing will just keep getting better, and users want them to need to know what like ABI is. And I really hope that they don't at this moment. So I think if we can't make that happen, this is going to remain very niche. So what networks are most of your users on?

Good question. It's been changing, honestly. and we've been very positively surprised how the adoption of layer 2 is growing. So we had, like, during this year, it went from roughly like 70% Ethereum domination to now Ethereum being, I don't want to be like, I cannot give specific numbers. I didn't rehearse them. But we have, it's one of the chains. So you can see it's full list of transactions that I make. being done all different chains.

And they're roughly similar. I think the biggest one is still polygon, but it's kind of shrinking in comparison to ZKSync, for example, transactions or base transactions. Optimism, Arbitron were historically growing pretty much every month. And Ethereum is kind of like at capacity. So it just sits there and everything else is growing.

So it's very exciting to see. And we do believe really, like we kind of refocused our attention from Defi protocols more towards supporting more and more chains because we think that in terms of the primitives we're pretty much there because I think

regionally people were thinking that defy would create thousands and we were one of the believers in that that we're going to see at least hundreds of different I mean meaningfully different protocols in Defi

or just outside of DeFi But it turned out, I think that we have a pretty stable set of primitives that people use. And everything else is more like, yeah, forks or just slight adjustments of what we have. And we've decided that, okay, we have to support this set of primitives. But really where we should spend our time is, you know, the number of tokens and chains that are being created. because we had kind of solidified the architecture, I would say, of this world computer. So we have all the bits and pieces in place, roughly. These computers can now talk to each other.

So now we just need to support this network of computers as the wallet. How do users go between different chains or between Ethereum and an L2? Do you guys kind of have endorsed bridges that you kind of offer as a standard interface? How would I go about it? Yeah, we actually support socket.com. So we've integrated them and they are an aggregator of bridges. The way it works is just they find the best rates across different bridges for any kind of swap. And the users just go and like select the bridge they want to use so they could optimize for

faster transaction, faster settlement or just cheaper, basically like matching how much they will get on the other side of the bridge. I would say this experience is suboptimal. Yeah, we've been even calculating the number of steps it takes to bridge to it like a new chain. So switching to a new chain is very simple, it's just like a few taps. But if you want to move money, you need to go and do probably 15 different steps, as far as I remember. And it also requires a lot of waiting time and it's not transparent, even in Zerian. we do as much as we can in terms of tracking assets

but the bridging experience is not optimal because you kind of have this moment where money is gone you have it in banks all the time but in crypto is unusual when you don't understand what is happening with the money because it kind of went away and you just like wait there hope that it's going to come on the other side

so we really want to optimize that in the future and the way to do that would be basically, and that's a general principle, moving away from multi-chain to one chain ux, as we started describing it inside Zyrian. So when users already need to understand the differences between chains unless they want to, and you can seamlessly move and transact on any dapp on any chain without really going through bridging first and then doing a transaction. So kind of bundling these two things together, insiding them all at once. So I think that's the future,

and we, I don't know when, but we're definitely going to get there. What are the steps kind of necessary to get there? Kind of the seamless bridging that kind of just goes on behind the scenes without the user even realizing? It's a good question. I think it's, first it's obviously some UX work

that we have to do. And we need to have more universal I guess adoption of signing either signing multiple actions with one tap. So that's some wallets already started doing that.

Before the convention was that you have to sign everything like average transaction one by one. But with approvals, that kills the experience because you have to sign multiple things. Permits are not universally accepted. So that's an issue.

And ideally, yeah. So we can bundle a few transactions together. And the bridges are fast and they could execute on the other side. Yeah, I think these are the necessary steps. I don't know what would be the guarantees between moving, for bridges to work between different kinds of and different versions of roll-ups. So whether it's going to be the same security guarantees to move from like an optimistic

equal to the ZK1. I'm not too sure about that. But yeah, I think that would be what we want ultimately as the goal. So basically, you also cover some chains that are not Ethereum L2s, right? This was, you can call it an experiment. We've added support for tracking Salana addresses. but that we all know the FTX story

but really it was I think we are not like our users don't really they're not Salano users in short and to be quite honest we have one of the zero values is don't be a maxi

and that's just like a whole company value and we wanted to explore other things we wanted to see so Solano was obviously getting a lot of traction so we wanted to support it and we did. Since the FTX and just overall, we didn't see a lot of traction in it and we haven't really put any more resources. Personally, I'm a big EVM supporter and believer because I feel

that we're kind of past the threshold where it's easy to compete with EVM just simply because we have so much code written down and so much investment done in security. I think we were never, maybe like someday a new Apple will be born that is going to use a bit of a different architecture. I don't think that's anytime soon. It's going to take years, I would say. So EVM is the way to go and we've been basically the whole infrastructure that we've built for tracking assets, tracking positions is built on EVM and like specifically for EVM. we touched upon it earlier just a little bit.

How do you think about account abstraction in MPC? Right. This is a long debate. We've been researching both for a long time. I think it started obviously more with MPC and the counterstruction became a more recent theme. I think MBC is a little... So there are many things I can say, I guess, on this.

And the short answer, it depends what we're trying to build towards. When it comes to experiences that remove basically the wallet from the picture completely, so like applications that integrate the world inside, I think for them, MPC is the only way right now to manage that. I think in the future, though, MBC has much less flexibility than account abstraction for anything related to user experience, like recoveries of phrases, making actions on behalf of the user.

So with MPC, I think there are a few attempts how you can implement the same programmability, really, of MPC. But this is a little too complicated. And it's hard to see how that's going to necessarily get all the traction. So it feels like to me, when it comes down, now we can talk about account obstruction. So with account obstruction, I think in the current form, there are still problems. So we've started a long time ago with this. this idea of let's replace all the existing accounts and with smart contracts on the protocol level. And I think it was like EIP 2000 something. I don't remember exactly.

But that EAP was not a priority for the community and for the protocol developers. So it kind of was worried. And now everyone is talking about the R.C. 437, which is making account abstraction on the application level and without necessarily you're hard for it. So I don't think this is a way to go for Ethereum at least, primarily because of the costs associated with that. And I think the future of account obstruction is really on L2s, where L2s make this hard choice and basically implement it on the level of the protocol when we actually remove the need for users to upgrade and move their assets from, you know, private keys to account obstruction, abstracted wallets. So I think that's

the way to go. And I know that there are some teams that are working on, for example, gelato team, they're doing a roll-up as a service. So they are thinking about implementing that for all their potential launch partners, such that this becomes more of a standard in the space where every account is indeed an account-abstracted wallet. And in terms of possibilities, I think one would be ideal in terms of the uxas. As I mentioned previously, when we support the same cryptography on account-obstracted wallets together with account-obstracted wall being on the protocol level, I think that's where we get all the flexibility that is needed, and it's not going to be associated

with an increased cost for average transaction, and we don't have to do this massive migration. I don't know what Ethereum is going to do, though. It's tough. I think majority of values is already on account on smart contracts, which is fine. Probably no one will just use Ethereum with private keys anymore at some point. And Ethereum will be just for roll-up transactions and block confirmations. But we'll see. Yeah, I think that's our current view on the whole thing.

We are exploring more native support for account abstracted votes in Syrian without necessarily launching our own version of it. We kind of see it as in a current form it would look like a Zerian volt in Solway because you still need to have a private key stored somewhere. And that would be the first step. And we actually already enabled some of the standards for account obstruction for tracking.

So you could plug in, if you have an account, you can plug in and get at least the portfolio value over time for these bullets. we haven't done transacting with the sports yet, but we are waiting to do that. Yeah, let's leave that there for now. I think there's something I want to come back to later, but let's talk about kind of the business models for wallets first.

So kind of monetizing a wallet has been notoriously difficult in this ecosystem with the two notable exceptions that you kind of mentioned earlier, legend MetaMask. what kind of business models exists and why is it so hard for wallets to kind of monetize? It's a really good question. So we've researched them all, I would say, at this point. At least like everything that's available on the market right now. I think there are a few things that really work, but they require skill and they require a bit of a, you know,

if there is speculation and market movement, obviously trading. fees work. And that's been working for Metamask. It kind of does still because they have a massive user base. They're obviously earning a lot less with the bear market. But all sorts of fees they work because users are ready to pay convenience and trust. So as they develop trust to your product, if they store enough money in it and they kind of been using it forever, they're okay with paying fees. We took a bit of a different pathway here. in comparison to like some other wallets. So most of the wallets, they don't have any option for more advanced users to stop paying fees.

And we took it one step further. So we allow you to basically hold a certain specific entity. So Zir and DNA with premium that allows you to not pay any kinds of fees. And that's basically our, we wanted to be using Zerian swap ourselves internally as a team. and for the majority, but like actually big chart of our users who are pretty active and they do a lot of transacting,

it makes sense to have the same good experience but not pay, you know, very high fees for swaps. But at the same time, this works for less experienced users who are okay with paying fees for the sake of convenience and trust. So that's the one model that works.

And yeah, but I'm not really excited about it. And the reason is that training fees and all kinds of like bridging fees or stuff like that is all driving the wallets towards the financial use cases and we see less and less transactions specifically for token trades or stuff like that. So a lot more activities on minting or doing some governance.

So people are doing more things with their wallace rather than just trading. And I think that drives away the value of this business model. so we don't want to be like Robin Hood, end up like Robin Hood selling options to retail users just to boost the volumes. So for us, like another big thing was API. This is something that is not accessible for majority of other wallets because they are just the front end.

We provide the data for the wallets. And we support quite a few wallets out there. For example, Rainbow is one of our clients since 2020. they've been relying on Xerian's data and they're ready to pay for that data because this is powering the user experience and we have more and more bullets who are using and leveraging our data

so that became you can call it like a bear market rescue in terms of revenue and monetization for us and lastly I think the way to go honestly a long-term vision is to ideally own the whole stack

so moving to monetizing pretty much any transaction that user does. And the way to do that is either the applications or the chains share revenue with bullets, or we primarily work with our own chains or layer twos, and we direct users to layer choose that we can monetize. So for example, launching our own layer two would be an example where we can monetize any transaction with like sequencer fees. So that's... I guess the path forward potentially, but it's a little too early. And we haven't seen, so this is like very experimental.

There are no, well, it's currently who have their own layer twos. Mammis is kind of with Laidea is kind of moving in that direction. I think that's what consensus once at least. That's the feeling that I'm getting. But this might be an interesting avenue. Have you looked at kind of becoming even more? more of a service provider and kind of abstracting fees away from people and kind of having them pay like a flat fee or like a service fee that kind of because kind of what account

abstraction also in principle enables is kind of abstracting the gas away from the user which I think kind of if there's kind of if there's where to become more mainstream this is I think where we have to go because I mean this is kind of the web to experience no one would ever say you're browsing to my website, please cover you're part of the AWS bill, sort of thing. So do you think kind of abstracting that way and then having people pay for the package? Do you see that as viable? We've researched that. I think, first of all, from the UX perspective, if you're completely right, this is definitely

how it will work. So we'll abstract away the fees, and I think we're not too far off from that. I think when it comes to monetizing that, it's a little different. So what you're suggesting is that we add a certain amount of like margin on top. So we make users pay more for the convenience. And you just charge them a flat fee per month, right? So basically kind of like, yeah, kind of like you do for kind of a regular bank account, kind of you have like five euros per month kind of in fees.

but then you don't have to pay for like every transaction, right? Yeah, but even with banks, right, like most of the banks now provide this service for free. So it's kind of like a race to up to zero with these types of fees. So you would ideally want to charge users for the added value and not for just maintaining, you know, Ethereum for like running Ethereum if they're not transacting and basically covering our node and note costs. So most of the services on Web 2, you would pay premium only for. for the features that you really want and not just them running from the AWS.

Sure. So I think the analogy here is similar. So we are moving, we are releasing this premium kind of in a more finalized state this, yeah, next months as well. So that would be, we'll see basically what our users are interested in paying for. Like if we provide them with premium,

can we provide them a few transactions in months free but these are all more of the economics questions and we need to test how it really works yeah i'm more excited of like basically if we if we have the chain so users are interested in paying for transactions right so that's pretty much universal and currently all of that revenue goes towards the chains themselves and none of that goes to wallets and this is a problem so that i think that value distribution have to switch so either chains start sharing more with the originators of transactions, or wallets become kind of like more vertically integrated with their own chains.

I think that would be, that's my prediction for the future. Because this revenue exists. Users are willing to pay a lot of money for fees, for settlement. Yeah, absolutely. I take it it's not on the near-term roadmap, but kind of where would you see that in terms of future developments for Zerion? I don't think it's like, so we are very agile still as the startup. So, first of all, you never know.

I think that's a short answer. We are convening with basically a portion of our team later in October to talk about what we should be focusing on really in 2024 as the big priority. So for 2023, the goal was to build the ball. so the best world for web citizens and we are almost complete with that so with the extension of release

that would be basically what we wanted to achieve and yeah the next phase is a little up in the year so we'll we can talk about that probably early next year okay cool and what else are you excited about in the ecosystem

there are quite a lot of things actually but honestly this whole up chain movement is what I'm really, really interested in. It's not that, like, we haven't known that already, but with, I think we're getting, we're opening up an avenue with scalability. We're opening up an avenue for more types of applications that are feasible. So I think defy was only possible because, like,

only defy was possible because block space was extremely expensive. So only financial applications, that run for whales would work. But now we can see, for example, with French tech or even Lenz a little earlier this year, that people are excited about social use cases. For example, with all the publishing with mirror or sound ex-y-Z where artists can directly connect with fans,

these are the use cases that are very new and only were possible because of the layer two adoption and kind of acceptance of layer two as also a feasible avenue for settlement. And I'm excited to see more stuff that is very much webbedronative that is built using the capabilities of more scalable networks. That would be the short answer. Fantastic.

So where will users learn whether Serion chain will be launched? Where can they follow you? Is it on Twitter or do you have a Discord? We've been around for a long time. We have actually over 100,000 people on our Discord. So, yeah, whatever your preference is, Twitter, you can type in Zerian or Discord as well. I think the ideal way is just to go ahead and try our wallet. If you are still using Mattermask, Kulhas, and Switch.

We have a bunch of people being super happy about it. If you want to provide feedback, you can ping me anywhere. on Twitter, for example, and I'll add you to the better testers group. So you can shape the future of Zerian together with us. Perfect. Thank you, Evgeny, for joining us today. Thank you very much. It was a pleasure. Thank you for joining us on this week's episode. We release new episodes every week.

You can find and subscribe to the show on iTunes, Spotify, YouTube, SoundCloud, or wherever you listen to podcasts. And if you have a Google Home or Alexa device, You can tell it to listen to the latest episode of the Epicenter podcast. Go to epicenter.tv slash subscribe for a full list of places where you can watch and listen. And while you're there, be sure to sign up for the newsletter, so you get new episodes in your inbox as they're released. If you want to interact with us, guests or other podcast listeners, you can follow us on Twitter. And please leave us a review on iTunes.

It helps people find the show, and we're always happy to read them. So thanks so much, and we look forward to being back next week.