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NEUTRON NATION
Recorded: April 2, 2025 Duration: 1:02:58Space Recording
Short Summary
Neutron is undergoing significant changes with new project launches and innovations in DeFi, such as yield opportunities on native Bitcoin. The Mars protocol has migrated to Neutron, marking a major transition, and is implementing strategic tokenomics changes, including token burns and potential buyback mechanisms. These developments reflect broader trends in the crypto space, with a focus on composability, yield generation, and ecosystem growth.
Full Transcription
Thank you. Thank you. Thank you. Hey sir, welcome to the Space Space.
How's everyone doing today?
Hello. Hello, hello. Loud and clear.
There's a terrible echo on your side. Oh, you can't hear me well?
I can hear you. Okay. I can still hear myself. Oh. Hmm.
Let me put earplugs.
Okay, how is it now?
Oh, so much better.
Nice.
There we go.
You're in professional hands here, folks.
We found solutions to all problems.
Let's see.
Who else do we have slated on for today?
We're just getting folks on board.
We'll start the space more officially in a couple of minutes.
I believe Sandro will not be joining us, unfortunately,
due to just, you know, medical, small medical mishap.
So he is probably resting today.
That being said, we will have
all the time in the world to grill
Pantera about his
adventures
at the train station.
Yes, very exciting.
It's not the Neutron Nation
today, it's the Neutron Station.
The Neutron Station.
The train station.
That's right.
Let me try and get Sluffy on as well and we'll begin.
All right.
Anyway, so how are you doing?
What are the news on your side?
Well,
I'm working for you, boss.
So whatever you say,
I'm here at your beck and call.
Who do you need me to take out on behalf of the Neutron Nation?
Wow, you've acclimated to the culture
really quickly. See, folks,
this is how you do it.
This is how you do it.
You first build the Hitman part part of the business then you expand extortion proof of extortion
in the culture documents there is there are a bunch of like recommended sentences for
folks who joined the team and like the first sentence is sir which kneecap do you like the least yeah it was weird the onboarding document was like
uh if you ever speak publicly on behalf of neutron and an official neutron
spaces make sure the first sentence incriminates everybody on the call
no but over here in in, yeah, I'm excited.
I'm excited.
It's been a journey for me throughout all of crypto as far as...
I mean, I'm actually ashamed to admit that I've been in this space as long as I have since like 2017.
I mean, I'm sure there's people that have been around longer, but it's been ups and downs and, you know, loops and turns. And it's, it was, it was kind of an
interesting, maybe, you know, fortuitous moment whenever Zion, who I knew from back in his
Terraform Labs days, DM'd me and he was like, hey, do you know anyone that's good at content
that might wanna help us out?
Cause we're making some changes at Neutron
and we've got some really exciting stuff on the horizon.
And I was like, yeah, I could do that.
Like, I don't know anyone, but I know me.
And so we met up in Denver and that tweet that I wrote,
it's, I might have embellished a
little bit but that's mostly a true story about how uh we sat down and he kind of he kind of
whispered all the the upcoming uh neutron secrets in my ear and perked my interest so um but yeah
you know this is this has been my first week I'm really just trying to like
download all the information and I'll tell you what it's a good problem to have like too many
things that I need to figure out uh it's just one thing or like oh here's a here's a light paper
that you can read and then we can repeat the same thing over and over again it's like oh there's by the way there's like six new exciting things happening and uh and then
there's like three more on top of that so i i'm excited i think it's like the perfect time for
for me to join the team and um i think big things are on the horizon for the for the neutron
community for the newts.
Oh, yeah. Oh, yeah, for sure.
We'll talk about that in a minute, but since you're the new kid on the block, do you want to give everybody a quick intro to who are you behind your Pantera profile picture?
What's your crypto journey?
How have you landed on neutron's
beautiful shores um well i guess that part you've already covered train station is how
yeah yeah for sure um yeah so as i as i my background uh before i back when i was a normie
in normiesville uh i worked for uh my first job out of college was actually a master fund started
payments company. So I was like, you know, finance adjacent at that point. And some recruiter reached
out to me and was like, Hey, there's this company in Pittsburgh, which is where I'm from, which is
my hometown. And it's in this crypto space. And I'd heard of it. You know, I had like, read about
the Silk Road and all that stuff going
on. I was in college back when that was popular. It was interesting because I joined crypto and it
was a risk to put that on your resume. We still weren't sure if it was even going to still be
around. I'm joining this company and it's like all these young guys and
the founders of the company were like 21.
I think the one kid, he didn't even have like,
he couldn't even go to the bar with us during happy hour.
And so, yeah, it was, it was interesting times.
And we were, we were keeping track of like all the ICOs in that,
in those days when you could trade your
precious ethereum for like the next greatest erc 20 shitcoin and uh i started just like doing content around that um you know ventured into like youtube and got really heavy into like cameras and
how to make the videos look good and audio and all that fun stuff. And then from there, I just kept kind of like
honing my craft. Pete, who I work with a lot on different stuff and have worked with in the past,
him and I, we've run validators. We are probably most infamously known as the co-hosts of Terabytes.
And I'll still like walk around a conference and someone will come up to me and be like terabytes
and I'm like oh no is this person gonna kill me or are they gonna like cry with me or what so
yeah it's it's it's been a it's been a ride through you know a bunch of different ecosystems
just trying to learn as much as I can and really like distill what what crypto is which is like uh you know i think john oliver
said this like like years ago but he said it's it's everything you don't know about computers
mixed with everything you don't know about finance so it's just like a huge mindfuck
and even having been in the space for as long as i have and being you know a moderately uh smart
person i think i i still look at things and I'm like, what the hell is this
person talking about? So I really try to make it my mission to like distill things down to
the everyday man that's just carrying his lunch pail to work and make it easy to understand and
get people excited about why this stuff matters, I think is, is an important place to start. So, um, yeah, that's,
that's pretty much my story in a nutshell. 100% man. What a journey. Um, quick question,
like quick and serious question. You've been here since 2017. There have been good times
and bad times since then. Have you already made it big or, uh, and what was your best and worst trades ever oh man
well i've i've i've had different degrees of making it big and losing it all throughout um
the the some of the best trades i've ever made i'll just categorize them instead of instead of
instead of maybe getting super specific but i would think some of the best trades i've ever
maybe getting super specific but i would think some of the best trades i've ever made is like
made is like when i actually believe in something uh and i know that's cliche and like kind of corny
but um you know i was an i was an early believer in bitcoin especially when a lot of altcoins came
out i i still like i didn't really see the the vision of them and i was almost like a bitcoin
maxi to an extent but i really loved the really loved the idea that you as an individual, like your labor and the value that you can create for yourself, whether that's through labor or like your intellect or whatever, I think it's really important that you have the right to retain that.
And so as we see, especially in modern America, or even globally, there's sort of the shifting power of the tides of power are changing ever so slowly.
And I think Bitcoin is actually really positioned very well for that environment.
And that was sort of the thesis that I really, truly believed in.
So some of the earlier days of our validators that we ran, this is even before Cosmos,
these were proof of work chains. So maybe they weren't even validators, they were mining rigs,
but I would just convert everything to Bitcoin. So that was a really good trade for me.
convert everything to Bitcoin. So that was a really good trade for me. And then I can say Luna
was a pretty good trade for me, even though it kind of ended terribly. But UST was another one
that I really believed in. I thought that the regulatory capture risk of USDC and the sort of
not knowing what the fuck is going on with like the balance sheet of tether
are are pretty big risks and i thought ust even though obviously you know it wasn't uh it didn't
work i thought it had a really cool message and it was something that i believed in so so that was a
good trade and then um and then it went to shit and then it was the worst trade but nothing's been
as bad really as like the last year because i've just missed like so many huge opportunities just messing around with like meme coins and shit like um spx 6900 i thought was like
an awesome meme and i think at one point i had like 10 million spx 6900 and i was like posting
pictures of me like in china smoking cigarettes and like memeing with the community and then
i just got bored of it and just sold it all and then it went to like 50 cents so you were part of mirad's army trade you were part of mirad's army yeah yeah
i was i was part of mirad's army before he like even popped up and and chilled it and i left before
uh before i got any like positive positive ev out of that one there were other ones like um you know when base
first came online i was um i was excited about that as like an l2 with its tie to coinbase and
so i was like hey like where are the undervalued applications and i i even like in one of my
groups like i shit i saved the message it was like hey look at this aerodrome like they're doing the most volume like like far and away on base but their token price is like total
and then i just totally mid-curved it i was like no there has to be a reason why the token price
isn't going up like somebody knows something or you know there's just like no reason to buy this
and so i like talked myself out of it and then it went like a million x and so you know
that meme that's like the market is omnipresent it knows everything before you do like every time
you think you know something the market already knows it that's christian bro right that's what
i figured i was like somebody at base is probably creating like another dex that's going to be that's
where they're going to like deploy all the. And so, but I was wrong.
I was wrong in second guessing myself.
So yeah, the last couple of years have been pretty shitty.
They've been more missed opportunities than terrible trades,
but they hurt all the same.
I think based on your trading experience
and my great round tripping of Luna bought at $5
and sold at zero dollars
we can extract two valuable lessons from this space which is one um potentially believe in
something but also never take financial advice from any of us none of this is financial advice
and don't follow our trades um you know maybe counter them like maybe that's a better that's
a better strategy but i'll leave that up to you to you guys you know what's funny is i was looking
through my twitter like you can see lists that people have added you to and i was just i was
just uh on a list it was like me and only like three or four other people and the name of the
list was do the opposite so whenever i'm tweeting someone
out there is just counter trading that it's the worst when you're added to those lists like you
don't even have control like you can't avoid it so like now now you're on that list and it's it's a
pan oh man all right so it sounds like oh go go for it y'all ask So it sounds like you've been through a lot in your crypto journey from validation to podcasting to meme coins and now ending up on Deuteron.
What would you say are some of those moments where you've had the most fun in Web3 doing which of those activities?
of those activities?
Oh, that's a good question.
Oh, that's a good question.
I mean, I think the moments when I have the most fun
are definitely when we were cooking on Terra,
and not to relive the glory days here too much,
but it's awesome when there's a complex application or piece of
infrastructure that comes in, and I'm talking to them. And like, maybe I'm not really familiar
with what it is first. And like, we get to talking, whether it's, you know, behind the
scenes or during the interview. And then, like, it clicks for me. And I'm like, Oh, shit, this is
actually, like, awesome. and i need to tell more people
about that and i think that's like a really cool like self-fulfilling moment is when somebody is
explaining this thing that like seems very complex and and is like very abstract and then i find a
way to like put it in my own words in my like stupid blue collar yinzer way of saying things
which is like pittsburgh slang um and then. And then I can like distill that and relay it back to people.
And I've had like some moments like that for sure
where I'm talking to someone and I'm like,
oh my gosh, this actually is like super revolutionary, super cool.
You know, I would say like some moments just,
I guess to be more specific is like,
I think on-chain perp stacks are are super amazing um i had just used like
kucoin or or binance or whatever back in the day and to to see like uh gmx when it first came out
and to be able to actually like get that the the quick user interface like interactions in the UX and the smooth UX and to be able to do
that without having to you know KYC or sign up with a centralized exchange or like to still be
able to keep custody of my own assets I thought that was that was awesome and I was like this is
the future I think the experience that you had on centralized exchanges five years ago
it's almost entirely moved on chain now i mean if you
look at like applications like hyper liquid and i know there's some drama surrounding you know their
their uh hyper liquid vault right now but it's it's um it's been really fun to like watch
that user experience move on chain where people can custody their own assets and you're not like
at the whims of you know whoever the next sam bankman freed is yeah absolutely and i think
it's easy sometimes to miss that if you're either stuck on like sexes all the time or stuck on on
chain all the time but like when you go back and forth between the two you really see how much has progressed in that manner over the past few years nice one yeah a lot of the people that are
like stuck on sexes um they they miss out on like the actual fun stuff right like the digging around
and looking for opportunities yeah and like you know there's people that they uh it's like they'll
buy they'll buy ntrn or whatever on a sex and then it's like well now what do you do, it's like they'll buy, they'll buy NTRN or whatever on a sex. And then it's like, well,
now what do you do? Right. It's just like price go up or price go down.
And so they miss out on like this whole, this whole hidden world.
I'm, I'm reading the Chronicles of Narnia to my,
to my three-year-old right now.
So they're missing out on like the, the cupboard or the wardrobe.
They haven't opened the door yet to the fun stuff yeah i fully agree but this this also resonates fairly well
with the with the neutron kind of like vision i guess so like uh you know you've just joined
and such and so i'm sure you'll be uh working through this over the coming weeks and such but
you mentioned earlier like you know one of your one of your skills, one of the things you do,
is take these complex, weird-ass blockchain things
and make them intelligible to everybody.
So in your own words, what do you think Nuchon does?
What's the point?
Yeah. So I think... you're on the spot here no that's that's fine um it's a
it's a great question so i think whenever so so like to talk about how much how much can i include
of like well i guess you you wrote that north star article, so I can talk about whatever's in that. Yep.
Okay. I think Neutron is in a very, very interesting spot where we have the ability to kind of create these very simple building blocks that on the surface level anyone can comprehend them and like you
mentioned very briefly uh something called max btc which is which is really how like zion piqued
my interest in our meeting um and to be able to get yield on like native bitcoin and get that
in bitcoin i think is like an insane opportunity But it's not only just that opportunity that
that is so interesting and where you can actually have a lot of fun, but to actually have like
composability built on top of that, where now you can take that into different strategies.
And one of the one of the most interesting things that I've seen in the past, especially like in
different ecosystems that are successful, is you start to end up with these people that are like, they're like crypto
finance nerds that are like constantly seeking alpha and like relaying it back to people. And
like you've, I've seen like so many people on Twitter that like blow up huge accounts,
not in a bad way. I mean, like they gain a bunch of followers because they they're they're
able to like find these interesting little like cheat codes or they're willing to like put in
the homework to actually do these composable things and then explain it in a way that makes
sense to people uh but one of the blockers of that i think in a lot of ecosystems is that it's still
very difficult it can still be very difficult and like even as a crypto native, sometimes I'm just so lazy.
I'm like, I don't feel like fucking bridging and swapping
and clicking the nine different buttons.
And like, oh my God, MetaMask is asking me
to input my password again.
Like, what is this?
I'm having issues with MetaMask right now.
But I think with Neutron,
the big opportunity will be to create
this sort of interesting environment where
you can do things that it's just like you get it. You just get like, okay, this is where my
Bitcoin yield is coming from. Here's what I can do with it. And here's the infinite other
possibilities of things that i can um build
on top of it and and you know in the past i think neutron you guys correct me if i'm wrong but like
you had a really big focus on um like some of the infrastructure stuff and things like the like the
cron module and like the the enshrined Oracle price feeds,
those aren't sexy in any way, right?
But what they allow you to do is create these very sexy primitives now.
And I think Neutron is in this amazing position where,
okay, now we're starting to see what is the end result
of being able to use these awesome primitives
or these awesome infrastructure modules and put them together to build
some really cool primitives.
And like,
we're still just like in the first inning talking about that because once you
do that,
then it's like,
all right,
well now how many derivatives do we have built on top of this to the point
where,
you know,
Joe Schmo with a,
with a cell phone is able to,
to go into some neutron app.
Doesn't even really know much about Neutron to begin with,
but they can do things like earn yield on their Bitcoin,
loop it into XYZ strategy and become like a total degen.
So that was a long-winded answer,
but I'm definitely excited about the ecosystem.
And that's kind of where I see Neutron, where it stands.
How accurate is that, would you say?
I think there's a lot of that, yeah, for sure. The way I would put it is Neutron itself
builds the tech that allows you to build these really appealing positions that are meant to be
designed as properly as possible so that people can actually make bank with them rather than just
as properly as possible so that people can actually like make bank with them rather than
just like you know can like put another coin in the slot machine every time and like have
50 50 chances of like losing it all or making a few bucks um so like enabling folks to like you
know have safer fairer better design more profitable ideally hopefully um opportunities
that they can fully access from anyone anywhere in the world without the need to,
you know, fill a bunch of paperwork to prove that they're already rich and therefore don't really
need these opportunities in the first place is kind of like, I think something that's actually
somewhat valuable for the world. So, you know, yes. I'm talking about, yeah, go for it. No,
You know, talking about...
Go ahead.
Yeah, go for it.
No, no, go for it.
I've heard you say in the past, like, the...
You know, one of the differences is, like,
Neutron has an advantage where we can build...
We have this, like, opinionated network
or, like, this opinionated stack that will allow for,
you know, like, better DeFi, like, applications
or builders to come in and build better opportunities. And I'm curious, like,, better DeFi, like applications or builders come in and build
better opportunities. And I'm curious, like, what is your thoughts between the position of Neutron
versus like, an Ethereum or a Solana, like when you compare sort of like the more monolithic,
you know, like more broadly? That's a really good question.
I think the key difference is this, right?
Like there simply is stuff you can build on Neutron that you just can't build on Ethereum or Solana or something.
And these things are possible here
because of these opinionated pieces of infrastructure, right?
The point being kind of like another way to put it, right,
is like there are like the first waves of platforms
that allowed you to have kind of like this flexibility
and development kind of like took this stance
that like, hey, you know, we want to build
like a world computer, right?
So anybody can come here and like within the constraints
of that, like, you know, we're going to create
that virtual machine and anything you can build within that virtual machine, then, you know, we're going to create that virtual machine and anything
you can build within that virtual machine, then, you know, like go for it and everybody's
on the same page and such, right?
And then, you know, this is great and valuable in the sense that like it offers this kind
of like neutral layer that is like, you know, open to everybody and such.
And that's very valuable in its own right. But it does have a bunch of
limitations and constraints that come from the fact that these things are not designed from first principles for any specific use. They're kind of like, ah, we'll make something general
that just generally works. And so when you're trying to think about the industry versus the incumbent financial rails, you start realizing that finance itself is in a perpetual search for efficiency and optimization. versus your competitors in most of these markets that results in you making more money, right? And so to bring a credible alternative
to existing kind of like financial infrastructures,
you kind of have to really push the limits
and try to build something that is either as performance
or inefficient in the way that the systems work
or better, right?
And that's not really possible to do unless you make these kind of like very opinionated decisions that like really optimize for one use case, which is in Neutron's case, right?
Like DeFi, right?
of like, hey, we're building a network
that's not trying to be all things to all people,
but that instead is focusing,
like laser focused on doing DeFi the right way,
you're able to like get these insane primitives
that are very valuable,
that allow you to build applications
that just aren't possible to build elsewhere
because you wouldn't have access
to the same pieces of infrastructure,
the same guarantees,
the same properties of the system,
if that makes sense.
Yeah, that makes a lot of sense.
And maybe it's like a segue to something else that I wanted to talk about.
So the thing with Ethereum is you've got this general purpose infrastructure, like you mentioned.
And I think maybe, would you admit that the trade-off, though, is, especially with leaving ICS, is you don't have the security of, obviously, of a Bitcoin or Ethereum, right?
Whenever you're building a smaller, more DeFi-Fi focused chain the way that Neutron is now.
So I think that's actually
one of the things
that's like probably not...
I think the way that we discuss security
in the industry is kind of weird
in the sense that,
yes, if you're trying to build
a World
War III fully government resistant system, and you put all of the chains that exist today
in the context of what that would look like, right?
You start realizing that a lot of these systems wouldn't work in these conditions, right?
I think Bitcoin, credibly, continues to work.
Ethereum, maybe. But Solana, for example, is gone, right? I think like Bitcoin credibly continues to work. Ethereum maybe, but like,
you know, Solana, for example, is gone, right? Like doesn't exist anymore, right? Bayes, same thing, right? Like anything that relies on the centralized sequencer, gone. Anything that like
relies on like, you know, a hundred like validators or something, which includes the Cosmos hub,
probably gone as well, right? And so it's like, what are the properties that we're actually trying to achieve?
Because if it's like World War III resistance, which I think is very valuable,
like the trade-offs you have to make for this means that in the average case,
it's going to be a pretty shitty piece of tech for most use cases.
And so it's like, once again, you can't be all things to all people.
You can't be all things to all people right you can't be uh both like you know planet explosion resistant and uh the the the most efficient um so like financial system
that that allows you to own things without middlemen and without like kind of like central
third parties right and so you know first there's this kind of like, yeah. I love the term World War III resistance.
Yeah, yeah.
I think it's a little bit more gracious than like,
than the alternative of cock fault resistance,
which Jacob Gideken and I have discussed many times.
But yeah, anyway.
So like, I think that's the first caveat, right? Like the second one is the way that we discuss securities in the industry
is generally pretty irrational in the sense that, okay, so the idea...
Uh-oh.
I can't hear it.
Okay.
Whoops. I got a call on Telegram, and that fucked up Twitter, Hello? Yeah. OK.
Whoops. I got a call on a telegram and that fucked up Twitter.
So let me just rejoin here for a second.
But so I guess just continuing from this other account,
the way that we talk about...
Just rejoin here for a second. Sorry. about sorry I'm having some issues with can you guys hear me yeah we can hear you yeah now i can't hear you because you're muted if you're trying to speak
anyway i can i can feel the airwaves here if uh if spade is got something going on but um
oh maybe he's back nope now he's a listener anyway i i do i love that term of like world
war three resistance um and and yeah like he he did mention like arguably only bitcoin survives
in that circumstance and not to go too far into like
this crazy abstract rabbit hole but um back i believe yeah so i got spammed on telegram and
that broke the twitter app which is so see it's not world war three resistant either um
all right so yeah like the point i was trying to make is that like, you know, we have this conception that like security is like, oh, an actor with a lot of money.
And generally speaking, like that's kind of like a proxy that we used to think about, like, you know, government types like attacks and whatever.
Right. Would not be able to like hack, like to take away my blockchain because like, you know, we have some kind of like resource constraints that would cost them too much for the attack
to be realistic, right?
And that's kind of like a weird way to think about it
when you take a step back
from just crypto-economic mechanism design
because the reality is, first,
as we see with North Korea very, very frequently,
if a very, very large, sophisticated actor
like a government or an equally powerful entity
wanted to attack a blockchain,
they probably wouldn't go on binance and buy a shit ton of tokens to take over the the valid
edge set right they would probably go about it in like different ways like compromising keys
social engineering and other things like this right and so it's like first are we really
dealing with the right attack vectors um secondly what you see in practice is that economic attacks just don't happen.
There's a bunch of examples of this.
For example, Terra when it collapsed had a moment where there were $2 billion of Ethereum on the network still because of BEs.
But the coin itself had suffered so much that from a proof of stake perspective,
the economic security of Terra was maybe 10 million max,
maybe a few 100Ks actually.
So if I'm a rational actor right now,
what I'm doing is I'm going to buy trillions of Terra,
which are dirt cheap at this point.
I'm going to stick them to my own validator,
and I'm going to take over the network,
sign a fraudulent message that allows me to bridge back
all of the ETH and basically make a $2 billion profit
or roughly that.
And so in theory, you could do that.
But in practice, what we see is it doesn't happen.
Now, sure, that was a collapse.
So there was a limited period of time
while you could have done this before the validator set itself
actually coordinated an upgrade
to prevent staking basically,
to prevent that attack.
But there are also longstanding examples, right?
If you look at Gravity Bridge, for example,
Gravity Bridge has been operating
with like $60 million of TBL
and about $10 million of like proof of stake security,
like the market cap, sorry, was like $10 million, right?
Which means like same thing, right?
Like you can go on and like acquire.
And if you're smart, you do this like over time and stuff, right?
So you don't move the market price.
You acquire a large portion of the supply and then you take over the chain and you steal
the $16 million.
That doesn't happen.
Like literally that situation has been ongoing for like years and it hasn't happened.
And like the lesson from this is kind of like a couple of things is like first the idea that like
proof of stake security that you can put a number on like how secure blockchain is it's kind of like
not a great way of actually gauging the security in fact what matters more is who are the operators
um who are the people who actually signed the blocks?
And the reason why that matters most is because at the end of the day,
what matters is are the nodes honest or not?
And there's other incentives than just slashing and the amount of stake
that a validator creates a cost that's like indicates whether that's like um
creates a cost for them to go malicious basically right um today if you're if you're a large validator
for example um you you're probably operating not just on one network as a validator right you're
probably a validator on ethereum and on solana and on other networks right and so if you misbehave
and you go and you you you directly attack a chain what do you think is going to happen to that
business right um like nobody's going to want to work with you like as soon as
that's known like you're you're a parry at this point right so you've lost not just all the
business you have on other chains you've also lost all of the business you you could have gotten in
the future right so overall that's like shit tons of money that you could have made that you're not
going to make because you decided to like you know like go road basically so there's that right and for most of the more established
kind of validators and such like that is a pretty significant deterrent um there's also just legal
repercussions right and i'm not saying that we should rely on legal guarantees in order to make
blockchain secure like that's obviously a very bad idea like the point of a blockchain is to not
rely on it but just like you know that's also a cost that is imposed on these actors like if you if you do that kind of like exploit you're very likely going
to have troubles with some jurisdiction somewhere because a lot of other people will have lost money
and they will sue you right um and so like all of these things together the point i'm trying to make
is that one thing is that one um whatever the staked value is, is actually not that important.
What's more important is who are the operators
and how do you get in and out of the set, right?
How is that regulated?
And two, that there's like a lot of other things
that come into this equation
than just slashing basically.
And so like the point is that like, you know,
like whatever the hub stake is, like that's great,
you know, like might Might as well get it.
But it's actually probably not what was keeping Neutron secure so far.
And by having a set of validators that are well-identified
and therefore subject to repercussions if they were going rogue,
you can actually achieve a very decent degree of security,
especially since the DAO in the neutrals model, the DAO itself is going to be curating this
violator set and such, which basically ensures that if they do something wrong, they're either
very quickly kicked off the set or they will face the repercussions.
And so in fact, it's actually probably more secure than just traditional proof of stake, because the idea that you could go and acquire enough tokens to take over the chain just isn't a risk in a neutral case, because the DAO itself represents such a large share of the stake that it is not possible to acquire enough tokens to take over the network, if that makes sense.
So yeah.
Yeah.
Go ahead. Sorry.
No, no, go for it. Yeah. Go ahead. Sorry. Go for it.
Yeah, that all makes sense.
I guess I wanted to talk a little bit about the Mercury upgrade, too.
I know you're probably getting sick of doing interviews about it, so I won't like to hear.
No, no. Don't talk about Mercury.
So the way that it works, at least from my comprehension, is the DAO will set an inflation rate. Is that correct?
Yeah, that's right. Well, not an inflation rate. No, not really, actually.
So the DAO already bootstraps the security of the network itself.
The DAO already bootstraps the security of the network itself, right?
It's going to, the DAO is responsible for putting together a validator set that is honest, that will do a good job at validating the network, right?
In doing so, it is staking enough tokens that it is able to ensure that it is not possible to acquire a sufficient stake in the network to take it over, right?
And so the DAO already guarantees the stake in the network to take it over.
And so the DAO already guarantees the security of the network itself.
As long as the DAO selects a majority of honest nodes,
ideally every node is honest, but a majority is required,
then the network is secure.
And so the reality is that Neutron will not need for you and me to go and stay cured like our Neutrons
in order for the network to be secure.
And so it's not like it's not paying inflation
like it happens on other networks.
It's more so that like from the perspective of the network
and the growth of the ecosystem,
encouraging people to use Enteron in DeFi
is very appealing because it boosts the local economy, drives people to use Antirin in DeFi is very appealing
because it boosts the local economy, drives value to the assets and such, right?
And so the DAO is effectively incentivizing activity by providing a risk-free rate,
which is the staking rewards rate that are paid directly from the treasury,
which creates new opportunities into the ecosystem through liquid staking,
through leverage looping, through lending and borrowing
against yield-bearing collateral that Deenturen represents,
and these kinds of things, right?
And so you can kind of see it as a sort of like entrant liquidity type model
whereby it's like the staking rewards are actually an incentive
to create growth and activity in the ecosystem,
more so than a payment for security.
And the reason I push back on the term like inflation is that no new tokens are being
created.
There's no block rewards.
Right.
And so the way that it works and says, it's just that like the Dow makes money through
the activity of the network.
And so, you know, it has an incentive on doing everything that it can in order to like grow
that market, that economy, which is beneficial to every application on the network at the end of the day what um you know what determines their their
ability to grow is also the size of the the market right like a a rising tide lifts all boats type of
situation right and so the dow is kind of like investing through these taking rewards into like
growing that market growing the application and the. And it is benefiting from it in the sense
that it is making revenue out of the activity
of the blockchain through transaction fees,
priority fees, other types of like revenues,
revenue share with some of the applications as well, extra.
That's-
I like that way of explaining it.
Is there precedence set somewhere else for this
or is this like
a totally new concept because i haven't seen this before this model yeah there's there's definitely
been so like um i i think it would be very fair to give like john charbono a lot of credit for this
we're we're so so john john charb um created this idea of proof of governance.
And proof of governance is kind of like, I think,
very, very, very close to what we're doing.
In the sense of like in proof of governance,
there's not even staking basically.
Like it's just like the DAO names the operators.
And as long as the DAO picks right,
the network is secure.
And this is decently similar in the sense that there's a valid or set curation
that is done through governance type of thing to what Neutron is going to be doing.
And so I think that is a precedent.
I don't think there is any network in the industry today that does this,
that does what Neutron is going to do.
And the reason is that we do kind of like, I guess you could present it as a form of proof of governance that
is designed not just for security, but also for ecosystem growth basically. And so if I had to
put a name for it, I would call it something like proof of liquid staking or something,
instead of just proof of stake.
And it is because there is this kind of curation aspect on this.
Let the DAO have an active monetary policy that is designed to increase activity and growth in the ecosystem, if that makes sense.
How different is it operationally from a validator standpoint standpoint compared to just like a traditional proof of stake network?
Yeah, that's a really good question. So like it depends what you mean by traditional proof of stake network.
But if we take like other tendement blockchains, you kind of have a sort of like bundling of a few roles as a validator.
of a few roles as a validator.
You have your kind of like,
what I would argue is that your primary role,
which is I have to run a node,
therefore like I have to properly operate infrastructure
that validates the transactions
that are included in that block.
You also have a community representation role
of like to attract stake,
but also to have visibility in that ecosystem.
You probably want to support the ecosystem in various ways,
you know, like, kind of like, you know, creating dashboards,
talking about the project, what it's doing, and such.
And you have this kind of like governance role of like voting in governance
with the voting power that others, like the delegators,
the stakers have delegated
to you, right? And so in Neutron's case, we unbundle these things to, like, we, instead of
packaging them together and requiring every validator to do everything, the only thing that
the DAO cares about in its validator set curation is, are these people, are these entities properly
operating the infrastructure to guarantee the network's performance,
health, decentralization, and such, right?
And so from that perspective,
the model that Mercury introduces
is actually much more manageable for validators.
They don't have to go and build these large marketing
and BD arms to drive state to their own validators and such.
They don't have to play the governors
or the politicians and such.
They just have to know how to do DevOps
and they have to make sure that they're operating
these nodes as efficiently, as robustly as possible.
And so from that perspective, it's actually
like a much simpler, more focused task,
if that makes sense, that enables them to be excellent
at one thing rather than being split in like you know a variety of roles that the earth can like
switching yeah it's it's like a it's a pretty elegant approach in my opinion and it's it they
don't have like uh they don't have like a governance uh burden either in this scenario, right?
Yeah.
Yeah, that's right.
And it's actually like, you know, it's not just from the perspective of like the burden
on validators.
Like that's a big reason why I think like what Neutron is doing is like a better design.
But it's also like we've seen like token-based governance is tricky because it is ripe with
conflicts of interest.
And so you have situations sometimes like there is precedent in the ecosystem where you've seen this there's
precedent of two things like one um there's precedent of like it's just a hard thing to do
like making governance decisions is hard and not all validators have the uh time and ability
the resources to go very deep into every single
question before casting votes, and they have a ton of influence due to those delegations.
And so sometimes they end up either not being able to make decisions because they're like,
oh, this is too complex and I haven't been able to form a strong opinion on this question.
form a strong opinion on this question.
Or sometimes there's even some more conflicts of interest in situations that arise from
the validators having so much power on behalf of the delegators.
So by unbundling the two, you can create a system that is a bit more elegant,
whereby the validators are tasked with block production and they do that very well.
But then governance itself can be handled separately,
which means that instead of validators necessarily being governors,
they can opt into that.
You can have delegations at the governance layer as well,
but the people that get delegated to
might be completely different entities.
So the idea is that community members that are deep in the weeds,
that have a strong opinion for where they want to see Neutron go, get to have the trust of their fellow community and token holders.
And they get to have an impact by receiving their delegations.
And validators can play this role as well if they want to, basically.
If they feel comfortable doing it, they have the resources, they have the insight,
they can opt into also being recipients for governance delegations,
which, by the way, are not in place.
They're not part of the Mercury upgrade,
but it's something that we've sort of
contributed to DAODAO to implement
and spec out in ways that are very interesting.
And so I think it probably would make sense
for that feature to eventually make its way
onto the neutral network and DAO, if that makes sense.
But you're saying an individual that's not running any of the infrastructure side can also garner delegations.
Yeah, so it's kind of like there's two types of delegations that we're talking about here, right?
Like there's the block production power, right?
Are you part of the validators that are actively verifying the blocks and finalizing them?
That's the things that you will do by staking NTRN natively or through Drop.
You will be delegating tokens for the validators to give them power in the block production, the consensus process.
There's consensus power and then there's governance power those two things are separate in neutral's model which means that
you can have delegations for consensus power and you can also have delegations that are completely
unrelated for governance power in which case you're like when it comes to making decisions
i don't have a strong opinion i think think Pantera understands this shit really, really well.
I trust his judgment.
And so therefore, I will allow him to cast my votes on my behalf.
Right.
That's interesting.
So it's almost like a grassroots politician can sprout up in the network.
Yeah, that's right. And why I think that's interesting is because there's a lot of like, like it's crypto as a thing is like very complex, but you have a lot of people all across that like, sometimes like build these incredible skills, and this like incredible interest and vision and things.
Yeah, that's right.
And why I think that's interesting is because there's a lot of like,
this incredible interest and vision in things
and empowering them to be able to actually have a say.
You might be somebody who's very smart,
very keen on neutral, and you want it to succeed
and you want to participate in decision-making,
but you're maybe not rich.
In that case, how do you actually contribute
in the most valuable way?
That's kind of challenging.
What delegations do is that for the voters,
they allow you to participate in governance with much less headache.
Because the only thing you need to do is basically choose somebody that you trust and delegate your voting power to them.
And then for the people, like the delegates, the people who receive the delegations of voting power, like the governance power,
it allows you to have more of an impact regardless of your financial situation.
You don't need to be rich in order to be somebody who adds value to the governance process, if that makes sense.
Yeah, that's fascinating.
And I think it moves like the whole network away from almost, it almost moves it from like a republic into more of like a pure democracy.
Is that an accurate way to look at it?
I think there's some steps in between in the sense that if you wanted to make something like a blockchain really, really democratic, you would attach the power over the decision making, not to the number of tokens, which is a form of capital.
You would attach it to people. The main reason why that's not how these things are designed is because it's very difficult in blockchain to verify somebody's humanity.
Maybe I can create 10 accounts on the blockchain.
Creating a wallet, for example, is absolutely trivial.
And this problem is like, hey, we're not able to match one account to one person is by doing stake weighted, right?
Like, we give power based on the amount of money that you put at stake in this process.
And the reason for that is that that's civil resistant, right?
And the reason for that is that that's civil resistant, right?
If I have, you know, $10, it doesn't matter if I create 10 accounts and put $1 on each account,
or if I just have one account, I put $10 because at the end of the day, I'll just get 10 points of voting power, right?
Regardless of which route I took.
And one of the interests here in designing like civil resistant mechanisms is like one, you want to protect against that vulnerability in the present.
But two, you also don't want to incentivize people to engage in these civil behaviors because future mechanisms might suffer from that, if that makes sense.
Does it anonymize the voters as well?
Because now you're not seeing like some large
i mean i'm sure there will be some large like dox wallets but for the most part there's not
like because i think like as someone who's run validators in the past one of the issues is
there's some you know controversial governance that goes up to vote and it's like well shit
like i don't want to vote on this one way or the other until basically quorum has reached you know yes or no on this and then i'll and then i'll cast a vote
to make it look like i'm doing something right um like i i think this is you know this is the reason
why there's an abstain uh option in governance right like if you don't have a strong opinion
you're not able to like form an opinion one or the other. You should just abstain.
Yeah, but even abstain is like, it still conveys like you chose not to vote one way or the other.
Sometimes that can piss people off too.
I think that's fine. Like political decisions like are meant to be like democracy and politics, generally speaking, are dissensus, right?
It's like, there are things that we don't all agree on.
Let's figure out the means by which we decide what we end up doing.
Right.
And so like, I think it's fine.
Like in general, I think an ecosystem benefits from having people who are able to stand up
for their decision or indecision.
decision. I think from the delegation's mechanism perspective, the idea is that who you delegate
Um, I think from, from the delegations, like mechanisms perspective, the idea is that like,
to and who has delegated to you would be public. Not in that the name is written on it, but
your neutral address would be written on it. And I think that's important for accountability,
actually. I think the main trade-off space here is that on the one hand, if you have fully anonymous
votes, that's ideal for making sure that the votes represent what people really think. Because,
as you just explained, if you expect social pressure, if you vote yes or no, or if you don't
vote, then that changes what you're actually going to vote, right? You're not expressing just what you think is best.
You're expressing what you think is best and acceptable publicly, right?
Which, you know, privacy is interesting from that perspective.
But at the same time, you know, if, for example,
some malicious actors start colluding and they're sort of like, you know,
using delegations to try and obfuscate the fact that like,
it's really just like five rich guys that are are trying to take over the network or something.
It's actually very useful to have all of this be public
because you can see who are the people colluding to do something that is objectively bad.
And you can then, as the social layer of the network,
can resist against this attack through socially activated force
or just basically calling it out and rallying against the malicious proposal um fluff i like fluffy i see
you've been having your hand up i'm sorry for going on a rant again no it's okay i just wanted
to hit on a couple things before the before the hour is up um so, maybe if we're done with the government's topic, we can talk about the
pin message, which is a super exciting announcement, which is extremely relative to this conversation,
which is that the DNTRN testnet was just launched like an hour ago. And so everyone should go ahead
and plug into your testnet wallets and mint some DNTRN.
First, if you need testnet NTRN, you can go to the Telegram channel
and request some from the faucet, and then go ahead and mint your testnet DNTRN.
This is an awesome first step.
At least something I just noticed, actually, and I have a question,
is the unbonding period for d and drn on the test net
it only says one to two days will that be is that just a test on the test or is that real
that's a great that's a great question so on test net the unbonding period is like much smaller and
the reason for that is you know if it's if it's really long like nobody will credibly actually
test those things so like when when both the developers that are working on a feature around staking
are testing it and when users are testing it, it's just like much,
much more convenient to have it like to much smaller duration.
The unboding period that is proposed for mainnet is 14 days, I believe.
So, you know, relatively short versus like other, other networks, while still being long enough that like you have these kind of crypto economics like benefits, I guess.
Cool. That's awesome. Yeah, thank you for answering that.
So another thing, I mean, unfortunately, Sandro could not be here to talk about the Mars, the Mars thing that he wanted to talk about today.
But I just wanted to relay that information
because I think it's pretty exciting.
So the Mars news for today was last week,
the Mars chain,
because previously they were an app chain
before they migrated to be an app on Neutron,
was completely sunsetted.
So the last of the validators were shut down.
And because of that,
all the unmigrated Mars from the old tokens to the new tokens,
and also some tokens that were left over from what they had put aside for validator rewards,
all of that was burned. So that's 122 million MARS tokens were burned.
And they just posted about it, all pinned in the nest in a second. And they also indicated in that
tweet that the burns could continue as they rework their
tokenomics and they might implement a buyback and burn. So as the revenue from the Mars protocol is
being generated, a portion of that will go to buying the Mars tokens and burning it. So if you
like burn tokens, that's one that you can check out the Mars protocol. And even right now, there's a proposal on-chain
to burn another $120 million of the community pool funds.
So they are going burn crazy over there.
If you have any Mars staked in the DAO,
you can go ahead and read that proposal
and voice your opinion.
So that's great.
And if anyone wants to come up from the audience,
ask questions, we're at the hour now.
But if anyone requests,
maybe we have time for a last minute question
for any of the speakers for today.
We'll just leave it open for a few minutes
while the guests give some closing remarks.
So maybe Pantera, could you give some closing remarks
for your first space here on Neutron Nation?
Yeah. Sorry to send Spade on a spin cycle about governance, but that was an interesting conversation.
And I think it's just more to the point that the the, the things that are happening here, I think are very exciting and like even down to this Mercury upgrade, which is, which is upcoming, um, like some, some really like cutting edge approaches the surface yet of what's actually going to, um, what's actually going to be like customer or like user facing at the end of the day, which, which is, you know, an even bigger ball of wax.
And I'm sure me and I can get spayed to like wax poetic for like five hours about some of that stuff if we wanted to.
So, um, but yeah, it's, it's all, it's all super exciting.
And, uh, I'm just, i'm just grateful to be able to
join the team at at at this time um i think it's you know the sky's the limit and uh if you're if
you're in this call and there's only like you know whatever a handful of people 20 people like you're
early so uh don't tell anyone it's still a secret. Awesome. Thank you.
Spade, do you want to say anything before we close it out?
Yes. The one person
that is tasked with
helping us grow the community,
like
actively encouraging you,
don't share the alpha, don't share the alpha, you're early.
Love it.
Awesome. Okay, cool. love it awesome okay cool well yeah the hour's up
I don't see anyone raising their hand to come up
and speak I just wanted to thank
Pantera for coming up and being our
guest speaker this week thank you Spade
for all of your insights
and thank you everyone else in the audience for
coming and sharing this time with us thank you and we'll see you next week.
Suspect. Thanks for joining.
See ya.
