GM GM let me send you an invite I hope you can hear me always stressed about
spaces and the technical difficulties I have PTSD from like every space I've
ever done Jim sir happy Friday yeah happy Friday can you hear me right yes
sir wonderful I got a new mic for my well I have spaces now and I just I had
like the Apple earbuds you know and I just I would listen to the back and it
was it sounded like a you know like a tin can with like a string going into my
phone it's awesome catch you got a mic got a mic to my phone had to get you
know my 12th Apple extension so at least I sound okay now I think I've said this
before but when composability and Apple products for heaven's sakes it's
probably the most composable to be honest and web to write or maybe a
little bit less than Android but definitely won't beat any blockchain
composability yeah it's just like what if they you know like USB-C like I
thought that was going to be the universal like I got a computer and it
only takes USB-C like I can't even do like an HDMI what's the square one but
they like it only takes USB-C and so they're like oh well you have to get
the thing it's like great and then the next one that comes out they bring they
bring it back it's like it's it's frustrating anyways also complaining
hello everyone thank you for joining us live listeners I'm gonna give it a
minute or two to allow people to filter in but it's nice to see you all happy to
see some new faces in the crowd
let me just boost my shit here
who's going to eat under I'm getting major FOMO already right here sir three
three notes so far one on the East Denver main stage obviously about
fractal what else and then also be at a stable summit I think this year they
renamed it unstable summit as a joke so hopefully that's not bad luck but I'll
be doing a big frax v3 the stable coin keynote there as well I'll be there all
week oh nice that's awesome we can reiterate that at the end make sure
people can catch you there that's dope I would love to attend those but I won't
be going yeah that's awesome does that stress you out having like multiple how
much you have to prepare are you someone who can just kind of get up and start
speaking without no I definitely I definitely like prepare the content I
don't thankfully like rehearse public speaking or anything but I know some
really awesome stuff I'm gonna be talking about both in terms of like
concept and obviously alpha because you know everything good in crypto is you
know deep concepts and important stuff mixed with good alpha right I mean
everyone everyone wants to understand how how this translates to digital
assets right not just like philosophical speak so I usually get a good feeling
for what all what I'll say the concepts but then also why it matters right like
those are the two things I'm excited to kind of talk about the same thing here
with with fractal the whole optimism vision and everything and also some
right yeah yeah you definitely need both yeah you gotta have substance but if
it's too dry then yeah you're not gonna you're not gonna win over the crowd
yeah that's that's a good that's a good way to go about it I usually find if I
usually if you like I over prepare usually for things but if I start
writing out like sentences you know it you're just gonna mess it up there's no
way to to like practice that and then not screw it up after but yeah with that
in mind looks like we have some people people filtering in about five minutes
after we plan this so let's let's get started hello everyone thank you for
coming welcome to the optimist podcast we're a media company who focuses
exclusively on the super chain so OP mainnet mode base any current and
future super chain networks you can think of we cover everything we have a
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for this little thing you can head over there and check out a summary of each
episode okay this week today I'm extremely excited to talk to the legend
himself Sam Kazemian from frax finance we're gonna be talking about fractal
which is a new chapter it seems like for for frax finance and everything that is
happening there I'm very excited to speak with you Sam thank you for your time
thanks for coming how's it going are you of course great to be here it's great
and really excited to kind of bridge the gap between the frax community and the
large and growing quickly optimism or should I say super chain community super
excited to talk about it yeah oh yeah yeah so I wanted to do a bit of an
introduction but they're always kind of the same a couple unique questions I
guess I'm wondering if you have a favorite hobby outside of crypto I was
also wondering what got you into defi I know everybody asked that but yeah can
you tell us a bit about yourself yeah just a pretty simple person I believe it
or not I don't do too much other than work on frax and then crypto and maybe
that's why frax is kind of a very large scope a grand vision kind of like you
know I always bring up 10-year horizon long you know trillion dollar market cap
because honestly most of what I do is just work on frax everyone yeah everyone
that in the community knows I'm always there we're always there most of the the
core devs are like that we're here to stay other you know hobbies I'd say
weightlifting I was on the powerlifting team back in college I do a lot of
powerlifting weightlifting and that's that's mainly it I built a pretty pretty
nice home gym so actually I can be even more efficient at working on frax stuff
we just go downstairs lift do do I work out in the entire garage and then come
and work for the rest of the day and evening usually pretty pretty simple
stoic kind of lifestyle that's awesome okay cool so before before we get into
the the fractal discussion and break down some of the details I wanted to
start with a couple questions about sort of defi macro and kind of get your
perspective on a couple things and I think it will help give a bit of like
color and context to the ensuing discussion also you know I'm just
interested in what you're saying okay so it seems like there's a new l2 l1 app
chain sidechain you name it like literally every week something comes out
and it's extremely hard to stay on top of how do you how do you view this like
explosion in networks this year especially as someone kind of entering
that market what's your perspective on on like all these new new chains coming
out and do you think that the innovation is is kind of keeping up
proportionally to the amount of networks that we're seeing yeah what are your
thoughts here yeah for sure first of all I just want to say like you're totally
right it almost seems like chains or roll ups I guess specifically or just
chains are the new smart contracts right and so that's a very important
concept to think about because we've had a lot of experience doing extremely
extremely well and making fracks pretty much a systemically important part of
defy on on ETH mainnet when when smart contracts were the the name of the game
so to speak right but chains are the new smart contracts going forward that's
actually the thesis here and so the fact of the matter is fracks was kind of
the I would say and I think with with defy llama rankings and everything it's
been a top you know 10 20 you know total protocol over like a thousand protocols
tracked in the kind of you know defy era so to speak and so how can we make sure
that fractal is a top 510 you know chain in this next era where chains are
the new smart contracts right if this thesis is correct right and if there's
one thing to kind of take away from from this talk between you know us and
everyone listening is in a world where it looks like everyone is going to be
able to deploy a roll up whatever kind of flavor of a roll up it is at the
click of a button right the same way that you know web to you can deploy an
Amazon server right what does that actually mean for the crypto industry
what are important conceptual considerations when trying to build you
know a systemically important to the entire decentralized you know ecosystem
a chain a network and what does that mean right the way that aetherium is
basically systemically important not in like a bad or centralized way but it
systemically makes the entire crypto industry work right with with roll up
security with all of the DA that's going to actually come online after dang soon
right and so the most important thing to consider is how is fractal different how
are we thinking about building fractal and and why right and as you said every
week every you know day even right and soon probably multiple times a day there
will be new app chains or some chains coming up and basically saying hey you
know use our chain right the question is why actually you know is fractal
different and why should people use it and what are we actually focusing on
what's the actual thesis behind fractal and what does it actually mean when for
example we call the thesis fractal scale we the reason we call it fractal
scaling which is something we can actually talk about shortly and where
the the whole chain gets its name the reason we called it fractal is because
we were not an app chain right so we didn't call it fraction which was the
original working name we want it to be known as a general purpose chain a
modular roll up so to speak and we can also talk about what we're building in
terms of different modules how it fits into the super chain thesis as well and
we wanted to name it after the tech thesis that we think if executed
correctly fractal will be a top five top ten chain in a chain you know in a
world with 10,000 or thousands and thousands of chains the same way you
know when frac's finance came out right there the DeFi platform and protocol
it's like a top 15 or something protocol out of thousands and thousands of you
know DeFi protocols on different chains on on Ethereum BSC L2s and all these
things right and you need to have a very very long-term outlook to actually
be able to like see these things and actually be correct about a lot of these
things right like you can be correct about what you think and if you don't
execute on that properly it won't actually end up happening right so yeah
yeah wow nice so much to break down there but something that kind of popped
in my mind was composability because and I think you know this might already
be the obvious to the listeners but composability in a modular world and
this is kind of like the core of the super chain thesis and other theses
similar but being able to connect all these different chains is
everything and like yeah I guess I guess I'm I'm thinking about kind of
what's been a bit of like growing pains for the Ethereum ecosystem because
there's so many new chains coming out they all have ideas about scaling and
right now it seems like they're kind of siloed and it's kind of you know there's
a lot of sort of fragmentation and fracturing of markets going on and to
and until those those markets can be sort of connected and composed with each
other I don't know if that's a thing but it's hard to it's hard to see the vision
when when we're going through this bit of a these growing pains so how do you
see the the composability sort of playbook playing out and I guess like
what's your your modular thesis for for Fraxville versus versus a more
monolithic monolithic thesis yeah definitely so this is actually exactly
what I think Fraxville uniquely addresses so for people that aren't
familiar with the difference between the modular and monolithic thesis the idea
is blockchains are basically separated into essentially three components to keep
keep it fairly straightforward it's basically execution data availability
and consensus and basically those data availability and consensus are are
packed together and then settlement is basically the another property right and
so the modular thesis breaks up each of these things individually execution
being the type of execution environment right like if you are an EVM right
there's also the Solana VM right the way that actually transactions get signed
and then the state of everyone's balances and smart contracts get
executed right you also obviously need a place to post the data that actually is
the the blocks that are being created right and and post it somewhere and then
some consensus method has to order that right this is stuff like Celestia right
things like avail network and obviously the the the biggest DA player in the
space is Ethereum especially after Danku right the the 4844 upgrade which allows
the theorem to have very very cheap blob space which is basically people
posting the data of their the roll-up blocks and the the idea here is that if
you can separate these things right you can actually address each of these
individual components right the composability of the execution
environments right the the actual data availability and the cost of the actual
chain and as well as the speed and throughput and so with Frax so we
actually have those things separated so like we actually have the ability to
post the data anywhere we want and actually we have the ability to post it
in multiple places so like including Celestia including Ethereum including
new DA projects that come up like avail network and these things and we can
actually change it to wherever is most important or just through what
governance actually picks as the important security property of the chain
so that that's one aspect of it the second aspect is basically how do we
want developers to actually be able to build on Frax till right and this is
where the the ops stack and the super chain coming right so after doing a lot
of discovery R&D and research we think that the most familiar and the most
performant and the best kind of high throughput execution environment is ops
stack right and so it's EVM equivalent right it is easily interoperable with
basically every kind of dev tooling and dev stack that people you know know how
to use right if you're aetherium aligned if you build on aetherium EVM chains
whether they're there in mainnet you know BSC polygon phantom whatever
everything just works right out of the box on Frax till you literally can can
use it in fact ether scan is the official partner that is running frac
scan calm which is the official box Explorer for frac still and it's just
very very simple to use right that's what's most important and the last thing
that you were talking about is the interoperability between all of these
chains right so the thing that's currently going on right and I think a
lot of people can see this depending on whether they're in the op community or
the arbitrary community or you know the polygon community and stuff is that
every single roll up major roll up provider basically has their own method
of trying to tie in the the roll ups that actually are using part of their
technology stack right everyone I assume on this call is familiar with the
super chain which is a way for every single optimism stack execution
environment roll up to communicate with each other right if for example obviously
base frac still you know other things you know mode obviously the op mainnet
now everyone else has their own opinionated way of tying in their chain
so for example arbitrum has arbitrum orbit so if you're like a gaming chain
or you're an app you actually use arbitrum orbit if you launch a
arbitrum execution environment right the the ARB stack so to speak right
polygon recently came out with their idea called the aggregation layer and
that's the layer where if you you know fork polygon zkevm there there's the
zkevm roll up execution environment then you actually push your proofs and
blocks to their aggregation layer so that they can all speak together and
have composability well the issue with all this stuff right is that exactly as
you're saying they don't really speak easily between each other so you have
these like big hubs like polygon like the op super chain and the arbitrum
orbit chains they don't talk to each other but they all talk to in
internally right all the arbitrum orbit chains talk all the op super chains
talking they all are kind of trying to compete in zero sum to get more and more
chains to come to their their area so what frac still is actually trying to
solve is this system of not being opinionated in interoperability and
making frac still basically this universal area where where settlement
can happen and in order to do that we have to build both a system of good
incentives right which is we can talk about the the flocks frac still point
system as well as a way to modularize each component of the frac still roll
up so it's totally unique so that it's not this monolithic system that only can
talk to the op super chains or the arbitrum orbit chains or I'm sure
there's other things coming to market in fact like zk sync recently announced
their hyper chain and I don't think that's going to be the last of them
right and in order to make frac still the top five or ten extremely important
chain in the entire world we have to be able to build something very unique and
then not just a monolithic fork well dude you're going off yeah again so
let's break down but it's really nice to be on the other end of hearing
someone talk about trying to like solve these issues between these these chains
because that you just talked about ethl2s and like that's that's among ethl2s
and never mind even like all the other evml1s and then non evml1s it like
where do you see other other l1s like you know does that extend to non l2s and
maybe not even like solidity based you know networks or like evm-based
networks yeah does that sort of mindset extend yeah it does and it makes it a
little more challenging too but it's what would be really revolutionary for
us to be able to get this kind of idea fractal scaling in fact the thread that
you posted on frax's announcement of frac still at the end there's this image
that is basically the the frac still scaling view of the world which is like
if frac still can be at the center of everything including other chains right
including cosmos chains Solana VM execution environments right including
obviously the ethereum rollups which are probably the the most straightforward to
actually integrate if we if we can do it right then we have something that's an
extremely important technology stack in you know in the next five to ten years
right and to do that you it requires basically decoupling settlement and
execution and data availability right and so that's why we opted to go the
full modular roll-up stack right so that if we post that availability to
Celestia and ethereum right we can actually communicate on some modular
level to Celestia and the cosmos chains right if we actually post that
availability to near who also has da functionality then we're able to
integrate the near ecosystem better right and and so if we're able to for
example have settlement on frac still so that people can build l3s and and the l3s
below us are able to have this entire uh composability right and this entire
integration with every single thing that frac still actually has they can if
you're for example a frac still three if you can decide okay i i can put my da on ethereum
uh near you know celestia or anything um because frac still will take care of it
right the the frac still main net is inter compatible with all these things
right that'll be an extremely powerful value proposition that i don't think anyone else
is working on right yeah totally extremely extremely cool um i love how we started out
with like the end game that's like okay here's like this is the you know however long
year-long roadmap um uh but yeah no that's extremely cool and i i i'm assuming i think
i know the answer to this but it doesn't discriminate um against like zk rollups
like are you looking at zk tech as well and building sort of like a module um for execution
or like using zk tech into the stack definitely right and so obviously the most compelling use
of zk technology is validity proof aggregation and not just for like uh you know single
enshrined bridge to like you know specifically like some l1 obviously like ethereum or
some other place but basically aggregating zk proofs that actually prove the validity of
in an entire chain's current state right that's that's the end game of uh zk technology when we
see for example vitalik posts uh his blog posts of like the end game of different types of snarks
versus snarks and and the usages of these things he's not saying oh it'd be really cool to have
that in like a zk rollup bridge right he's saying that this is a huge technological improvement in
being able to prove the validity of large amounts of transactions happening in different networks
and so the use of that is to aggregate all of that in in one focal point right and one
shelling point so everyone can use a specific chain as kind of the reference point to settle
what they believe is the end state of for example some other chain whether it's an l3 or it's a
different uh l1 or something like that and so we are looking into aggregating zk proofs and having
that be part of the settlement technology for fracks is a little bit farther out obviously
right and so it's uh more closer to the end of this year or sometime next year yeah obviously
that's not even as far as far out as i was i was thinking but obviously you know no timelines in
mind but that's just that's just extremely um extremely cool and uh i'm very uh bullish um
um okay so let's let's bring it um let's focus in on on fractal um in the more immediate term
and get a little bit more granular with that uh i want to talk about oh actually yeah i want to
talk about um gas first of all um where i believe frax eth is being used as gas can you tell us
what's the reasoning i think i could probably make a make an educated guess but what's the
reasoning behind using frax eth as as the gas token yeah so frax eth is the uh ethereum pex
stablecoin of a frax finance and the reason i say that rather than an lsd is that uh whenever frax
issues something like you know uh frax the dollar pex stablecoin or frax eth the uh we call it an
eth pex stablecoin there's a staked component that gets all the yield right and so we have an lsd
called s frax eth and the idea behind it is that the actual stablecoin can be used as gas right and
so uh the more and more people you know use uh frax till the more and more the actual lsd's apr
goes up because more and more of the the base token actually leaves circulation and so there's
less amount of of staked frax ether sharing the the validator rewards of a larger and larger
validator set so um that is the the reason and also the reason is because it's an evm execution
environment right so everyone should be very very familiar with just having a you know frax ether
or some kind of ether pegged unit denominated in every every gas uh transaction and the gas will
be extremely cheap so a lot of people can build different kinds of apps obviously with with l2
scaling as well as da module scaling so it should actually be even cheaper than uh i think it should
be even cheaper than arbitrum optimism and polygon uh today obviously after dankoon i think it'll
still be even a little bit cheaper but we will uh see how that uh shakes out super cool yeah the um
it's it's just another um another way of taking you know frax eth off market and and um raising
like if anyone i'm assuming a lot of you are familiar with the two token frax eth and st
frax eth uh system that sam just outlined um but the reason staked frax eth can get
such high yield is because you know a lot of people are in frax eth and you've got you know
to use very simple number double the the number of eth state for half the you know state frax
frax eth that's that's accumulating these rewards so the that that that premium or that that yield
is just going to keep increasing as frax eth gets gets used as gas i hope um yeah and historically
that's totally correct and historically uh staked frax ether has had probably like
something between uh 10 to 30 percent all the way up uh higher yield than uh lido and rocket pool
um and so uh people think oh there must be higher risk somewhere right it must be either restaking
or it must be hypothecated or something like that and it's actually not what we do is we
try to build monetary premium for the the unit that's the underlying unit which is why we have
exactly as you said perfectly the the two token model uh and it's actually honestly it's very
similar to die and s die right because because frax also doesn't a dollar pec stablecoin right
frax and s frax and it's really not any different right economically right the more people use
the the unit for payments right uh other things right obviously the eth unit is extremely important
in uh rollups and ethereum for gas payments and gas denomination the more people use something as
money the the better the actual yield on the thing that when people use it as savings right
because there's less people using it as savings and so that yield gets distributed to a
less amount of people so the apr is higher it doesn't mean that there's more risk in fact
frax ether is the exact same underlying risk as steath namely very very little but
it always gets like you know 10 to like around 30 sometimes even percent higher yield than uh
steath so like in fact right now the um s frax eth yield is like 3.8 or 3.9 and if i actually
go to lido uh and check on their front end uh it's 3.4 that might not seem like a lot right but
about 0.5 percent more between 3.4 and 3.9 is is literally like 30 percent you know at large
numbers right yeah 50 base points is not nothing yeah when it when it first came out i was like
okay what's going on here but then as soon as you understand it it just i don't know it clicks it
makes perfect sense and you've done like your team is so good at designing these like mechanisms
that really take advantage of just um like just economic activity that will play out and like
being on the winning winning end of that um if that makes any sense yeah anyways yeah we call it
we call it the stable coin maximalist centric view of the world like we try to design everything
uh that tries to capture as much monetary premium right like one of the ways that we think about
everything at frax finance is like if you're going to issue an asset the goal should be that
your asset class is used as as money in as many places as possible because the monetary premium
of an asset is the most sticky the most lucrative and and the most systemically important thing
you can actually uh build so what in fact like one of the long-term things that i say that is our
our grand vision is frax is trying to be the most important systemically important issuer of
the the important units of the 21st century right so what are those units there eth btc usd right
like these are the the units that i think are going to be extremely extremely important this
century right maybe another few uh important crypto assets right if there's uh other ones that
make it as big as ethan and btc uh but those are the obvious and obviously usd in terms of fiat
currencies are the important units that everyone will if they don't already use will use some time
in our life in this decade or next right yeah yeah yeah being being the the main sort of
like debt issuer um in a decentralized way that's um that's an awesome goal that's a
lofty goal and i believe in you um i will be uh on the i'll be participating okay so anyways
speaking of um incentive mechanisms let's uh let's talk about uh fractal incentivization and the app
layer why we're all here really no um but the exciting stuff for um for degenerates like myself
um flocks and flocks mechanism uh i i have uh done some reading on it i've um you know i've
heard about it i i have an okay understanding of it i'm extremely excited about it um so tell
tell us what it is uh just at a very basic level we'll get into some details but yeah tell me why
i'm excited and uh yeah how does this work yeah definitely so again all of this stuff
we've been talking about until now in terms of fractal being important and and everything won't
be possible if it's not one of the largest tvl you know like you're saying vibrant ecosystem
uh execution environments right this the state of the network right the the whole uh dapps and
economic activity actually built on fractal so we thought about that we're like okay um again like
you said well at the beginning in a world where every day there's like new chains and they're
saying hey we're gonna do a giant airdrop or like hey like here's uh our thing that has a little bit
better yield or something right uh what is actually better what what actually aligns
long-term value and gets people to build on uh fractal so we we thought okay there's a few
important metrics that are very abstract and generalizable that you can build an algorithm
around that uh if you can actually make this as part of the chain rather than this like like an
airdrop or something but actually a part of how the the blockchain works the the gas system works
and stuff you can actually build an incentivized uh blockchain that actually rewards everyone for
building it and making the block space extremely valuable so we call it block space incentives
and we call it flocks for short so f-l-o-x uh the idea behind it is that the more amount of gas
that your contract uses the more popular uh your contract or your your e-o-a and everything is and
also the the more total uh historic activity that that your contract and your protocol have
the more fractal points you earn and that actually can be even more generalized down later to
different kinds of contracts too right for example we were talking about if you launch an l3
maybe your l3 will actually earn uh flocks uh fractal points overall based on how much data
and actual uh assets uh the contract has and how much data it's pushing right and so you can
actually make it so that people are properly incentivized for the actual value that they
they bring and actually be able to incentivize everyone to do everything that they want whether
it's building like an nft platform a t5 platform even building an l3 app chain and all this stuff
in a generalizable way without having like a one-time airdrop or like an airdrop every week or
something so this algorithm is always running so there's a flocks algorithm and it's looking
through uh every single transaction in every block it's looking at how much gas each transaction uses
and what uh smart contracts are called how much gas is paid and then also specific things like
how much of the total users of the chain actually have historically called the smart contract which
is actually what makes the algorithm very difficult to gain which we can actually talk about in a
little bit right um and so the idea is that if you've been to like ultrasound.money i think a
lot of ethereum people have been on there the thing that's kind of uh keeping track of the most
popular uh eth mainnet smart contracts right they call it a burn leaderboard because it's about
you know calculating how much ethereum is burned but if you actually go there you see this
interesting thing for example like the uniswap contract is the is the top on the leaderboard
like the tether contract is number three and then for example the the starkware uh l2 contract
is number like six or seven and then arbitrum is eight and and for example the optimism contract
is like 11 or 12 or something and the uniswap swap router is i believe 13 if i counted that correctly
and the idea behind this is that imagine the the flocks incentives are very similar to this and
you're actually earning points instead of you know getting kept track of how much easier burning
it's actually the opposite you're actually earning something uh that'll hopefully be worth a lot of
uh value depending on how popular your contract is right and there's obviously going to be different
categories it'll also have a front end just like ultrasound.money if anyone goes to ultrasound.money
and checks out there's different categories of for example d phi l2 uh dA contracts NFTs uh
MEV contracts miscellaneous contracts like meme coins or things like that imagine this turned
the other direction of instead of keeping track of just the amount of eth that's burnt it's the
amount of popularity and the amount of frax eth spent uh historically and getting points instead
of uh lowering the supply of eth that's how you should kind of think about the flocks incentives
oh my god super well said um so so cool and i really appreciate like the like you were mentioning
um just at the beginning there with uh like a lot of the sort of business level strategy
copy pasta that's happening um i really appreciate the like the the sort of
drive for innovation in terms of not only like like a scaling roadmap but also just like
how do we actually try and get the most perfect alignment between the the app layer and and the
execution layer um and like getting them getting the alignment between the chain and the apps that
that run on top of them and the fact that it's it's like a continuous continuous system and it just
runs um is just is so cool and i think it like it perfectly captures the essence or at least half
of the essence of defi other than you know the decentralization aspect but the other half is
as i see it as kind of like programmability and automation you know like being able to design
okay i'm not an engineer but being able to design like a control systems for lack of a better term
um to sort of phase out and eventually remove the flawed element of human decision making
uh is like really powerful like you know i i work for a you know projects doing some liquidity
management and incentives and anytime i have to make a decision like i i don't want to make any
decisions you know like the fewer decisions i can make the better like i want to press play
and i want to have the math and the market kind of work it out for me where everything can kind
of just run autonomously like that's that's you know that's the goal and i think that's
that's what makes defi awesome because it's it's possible um that's exactly what we wanted to do
right and it's like the the goal was to make sure we could do that as as best as possible
uh and have the system be part of the chain right like for example a lot of people uh were actually
hit up by so many projects which is an extremely extremely bullish thing people don't know in the
back how you know hectic it actually is and it's a good hectic right and um the the idea is like
people are always saying oh like are we gonna miss the deadline or like you know the the blast thing
they have like this deadline and that thing we we didn't make it for the first airdrop so the next
one is in four months or something and all this stuff this has none of those right like you're
saying it's um it's a programmatic system it's always running as part of the network if you
deploy this week or or next month or next week whatever it doesn't matter right obviously you
might miss out on on the amount that you're you're live right and people uh use your your dap and how
popular it'll be but there's no human manual system of oh oh like this grant round is over
uh maybe you'll you'll win uh grants like next round in five months or something or oh we just
had the airdrop last week and that's it or something right and so for example the the stark
airdrop that was a huge huge airdrop right stark net is a huge network that's super exciting and
it's out right and it's uh well whatever people's opinion was whether it's good or or bad and stuff
it's like okay now it's done right like it's like a huge event leading to it and like boom it's it's
done right uh next one if there is one right might be months and months away right and so
it makes it less uh defy and crypto crypto native if it's just this kind of manual system done over
a very long period of time versus with with fractal the whole point is as you build you'll just see
your your actual points balance increase yeah like a lot more transparency and um you know
less need for um just more like uncertainty and speculation from from the users and being able to
like actually engage in the system just um you know ongoing and be able to track their what's
going on um yeah super in line with with uh the ethos like really aligning the most deserving
deserving users and deserving contracts and speaking of that i want to get back to the gaming
aspect um because like i'm sure it's it's a really hard problem designing like designing
you're incentivizing the proper activities beyond beyond just gas usage or or tweaking that in a way
that it that it will work and how you can discriminate between sort of like too busy
you know like wash trading or just like launching a bunch of smart contracts that don't do anything
and just eat up gas floating numbers versus versus real usage um how do you how do you approach the
game aspect um yeah yeah so definitely we actually that's the first thing we thought of right it's
like hey well if you're gonna uh really reward people that have uh high usage gas contracts
and fractal points are going to be worth a lot of uh value right and in the future how do you actually
make sure that it's not gamed or in crypto native speak how do you make sure it's exponentially
difficult to gain right like if you think about it bitcoin can be gamed if you just have 51 percent
right it but and so can ethereum but it's so expensive and so impossible to actually have
that amount of resources to to extract a smaller amount that no one tries to game it because it
doesn't make any sense right so we thought of the this actually the same thing and what we came up
with is what something we call flocks rank which is a a algorithm in the algorithm that checks how
popular a contract actually is it's actually inspired by google's page rank um for people
that don't know google's page rank is like the original idea of scouring the web and checking
how many other sites backlink to the site of interest and depending on the reputation of those
sites and the total number of backlinks you can kind of make an estimate of how reputable the the
side of interest is right and our way of doing it is we check how much the total amount of
users are eoas and wallets actually have interacted with uh the contract of interest
and if you think about it if there's uh a lot of people trying to game the flocks mechanism what
are they going to do right like eoas are not symbol resistant they're not kyc right everything
is permissionless so you'd have someone come and make like a million bot accounts right and then
they would and everything else makes a million exactly exactly right which is how this this
becomes exponentially expensive so one person makes a million bot accounts and they try to
interact with their smart contract to make it look like a million users are interacting with it
then someone else tries to game it by making a million bot accounts themselves interacting with
their smart contracts right and now you have two million users but like no one is actually
other than them interacting with those accounts but you have normal you know real users not bots
interacting with the router contracts real lending protocols and things like that and so you have
a larger number of the percent of like total users that actually use the the real uh assets so
the reason it becomes extremely expensive is that the people that create bots just actually end up
washing themselves out exponentially right the more people that game it the the less it becomes
possible to game so the the kind of nash equilibrium becomes mostly real people using the contracts
because in order for you to actually game it you have to pay other people that are using real
contracts like the uniswap contract or the or the fracslend contract or something to actually come
and and use yours right to basically pay them to to use your contract and you can do that right
just like how you can kind of game the google page rank there's like link farms and stuff and
and and it costs a bunch of money but by and large it's like the it's extremely expensive to
to do that uh and and like uh well maybe the the link farms are actually less expensive right but
this is even way more expensive because you have to pay levels and levels and levels of people to
actually uh get to the top of this and so it just becomes infeasible unless you you think you know
fractal points are going to be worth you know 200 billion um yeah um yeah it's totally like
a prisoner's dilemma kind of outcome where you said like the the any is it's just you know
nobody does it and then real usage is the one being is is being uh actually rewarded um yeah
okay really really cool um i like that i'm a big game theory uh fan so that's that's cool um
um and okay flocks is also obviously like we mentioned it's transparent to everyone and that
includes protocols um so like this is this is kind of a tool that's that is embedded into the chain
but can also be used by by whoever's on the chain to like get insights into you know who the who
the biggest users are who the who the most uh active what the most active contracts are
um so am i right in thinking that like protocols can just use this um to do their own incentives
and it's just like it's it's basically a growing database of just like um you know good uh good
and active participants in in the space and that's like you know you can go beyond um just incentives
like you can just use this data to to do whatever you want as a as a protocol is that is that right
yeah and in fact you're here one step uh ahead of me on that because like exactly we're kind of
waiting for uh developers and other users to see it as as it goes live right um it goes live march
13th by the way that's the the date that the algorithm starts running part of the the blocks
that come in into the sequencer right and gets analyzed but you're you're totally right exactly
it actually makes uh every contract and everything on track still uh even more data rich right you
have this system that you can do future airdrops you can do uh points on top of points right for
uh different contracts different communities and you can actually use the historic data
to build really cool stuff right and we're actually excited to see that
awesome awesome okay um i know we're getting on a bit on time and i don't want to take up
too much of your time so we have to talk about um fxx and v fxx um to close out here um so
um to the moment you were all waiting for no um can you uh can you talk about um you mentioned
march march 6th that we said march 7th yeah so so march 6th that's uh where a large amount of the
initial distribution of fractal points will go to v fxx stakers and uh additionally obviously uh
that is like an airdrop that is like a one-time big thing so it's different than the the flocks
kind of uh algorithm that we're talking about um and there likely will be large drops to
v fxx holders again uh multiple times uh after march 6th but the march 6th one is the biggest
one so that's definitely something on the horizon right okay awesome um that's me
then okay after that once the once the chain goes live to the public um i'm assuming you'll
you'll be able to take your your fxx or your v fxx and stake it on on fractional is that right and
then you know those uh participants are presumably going to be um you know tracked with flocks um
and you know rewarded accordingly i don't want to put words in your mouth but um uh yes actually
yeah so there's actually a a boost system for v fxx so actually the more uh you do things or if
you're a protocol that has v fxx and uh and delegate the balance to your contracts you'll
actually get additional boost so so v fxx is both valuable in terms of the uh airdrop of
fractal points uh both on march 6th and later but also every interaction that you make
and use the chain you actually get more and more points so it actually makes the whole system run
so it's a it's a very important uh part of the actual uh tokenomics we thought about it a lot
and the question to your uh v fxx staking you can do it on mainnet or on fractal it doesn't matter
there will be a place you can uh stake on fractal i have mine all staked on mainnet just because
it's you know been doing that for a very long time and the balances get combined on fractal
because the good thing about a roll-up obviously is that you can read state from the l1 right and
which is ethereum right and you can read the balance of v fxx per account so it's actually
pretty trivial to bring everyone's v fxx balances especially because they're non-transferable right
it's the it's the balance of locked fxx so it's a state read it's pretty simple they're the same
balance uh you could stake anywhere and get the the same utility for fractal points so it's all good
dope super dope um okay what about builders how uh how could builders get involved um uh
where can they reach out where can they find resources if they want to uh launch an app and
i wanted to ask you actually if you have a favorite um a favorite app apart from your own work um
or design that you're just generally a fan of maybe something that came out this year or
uh like an app that you'd like to see come on to fractal um yeah yeah definitely uh first
thing is uh you can add your application even before deploying it to the ecosystem
github repo just on fracks.com you click ecosystem uh you can join us on telegram like i was saying
before i'm pretty much all i really do is just work on fracks and uh maybe just go lifting and
then come back and work on fracks so all everyone's always there you could always talk directly to me
uh very very available um add your project to the ecosystem repo uh it'll also prepare us to
you know start knowing to integrate it in the flocks algorithm and see how how it's doing um
in terms of apps actually that's a great question um i i'm really interested in a lot of the the
new kind of defi yield apps and systems so obviously outside of anything fracks is built
i i really like the new llama lens that curve just actually deployed today it's like a generalized
version of their crv usd uh lending system there's also a few other cool projects kaidau
is already deployed on on fractal's you know stealth launch uh mainnet there's a few other
projects um i think that this cycle is all about basically uh higher yield but safer yield so
hopefully not anything like the uh past you know uh terra luna situations of last cycle but i'm
very excited about restaking uh which is you know fully collateralized higher yield of
east is right and those are projects that i i hope will deploy uh and and yeah overall
we we also are working on something called the bam uh and that actually is a system where it's
both an amm and a lending system in one um we're really excited about that it won't come out for a
little bit at least another month but i think that'll be a really really big deal for uh people that
are traders and and leveragers and like the uh best place to trade uh new tokens basically
yeah hell yeah um agree i i also think llama lens is is really awesome and innovative and i um i
know you got other responsibilities so you're gonna have to jet pretty shortly but um i i did
want to ask you about bam i i got like a million other questions for you um but dude that this was
awesome and you're gonna have to come back on if you'd be so willing um but i'd love to have
more conversations um and reach reach more um optimists with uh with your tech because i'm a
big fan i love your team um i'm a user of your products so uh thank you thank you for coming on
um thank you for your time thank you everyone uh who listens um but uh yeah it you know come
come back next time and we'll talk about we'll have a six hour bam uh huddle yes sir we'll have
one of those like super long if people watch like spreadman uh podcasts like the three four hour one
we'll have we'll have one of those on on everything fracks and crypto and everything uh thanks for
having me really uh excited to come back on and take care everyone thank you awesome thanks