On May 20, the market does not slow down for hesitation.
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Automation is not about replacing judgment โ it is about making trading more disciplined. ๐ค๐
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Gym done. Body getting stronger, portfolio getting smarter. Best thinking happens when you're pushing limits โ that's when the real long-term plays reveal themselves. Build everything. ๐ช
flight's delayed 3 hours so guess i'm camped out in the lounge lol. at least i got wifi and time to finally clean up my crypto watchlist. silver linings โ๏ธ
Traditional banks are finally waking up ๐ The digital finance wave starts slowโฆ then hits like a tsunami. Those not positioning NOW will be left behind. The writing's on the wall. #DeFi
Finally, the block building pipeline.
In Glamsterdam, Ethereum is getting ePBS, which lets proposers outsource to a free permissionless market of block builders.
This ensures that block builder centralization does not creep into staking centralization, but it leaves the question: what do we do about block builder centralization? And what are the _other_ problems in the block building pipeline that need to be addressed, and how? This has both in-protocol and extra-protocol components.
## FOCIL
FOCIL is the first step into in-protocol multi-participant block building. FOCIL lets 16 randomly-selected attesters each choose a few transactions, which *must* be included somewhere in the block (the block gets rejected otherwise). This means that even if 100% of block building is taken over by one hostile actor, they cannot prevent transactions from being included, because the FOCILers will push them in.
## "Big FOCIL"
This is more speculative, but has been discussed as a possible next step. The idea is to make the FOCILs bigger, so they can include all of the transactions in the block.
We avoid duplication by having the i'th FOCIL'er by default only include (i) txs whose sender address's first hex char is i, and (ii) txs that were around but not included in the previous slot. So at the cost of one slot delay, only censored txs risk duplication.
Taking this to its logical conclusion, the builder's role could become reduced to ONLY including "MEV-relevant" transactions (eg. DEX arbitrage), and computing the state transition.
## Encrypted mempools
Encrypted mempools are one solution being explored to solve "toxic MEV": attacks such as sandwiching and frontrunning, which are exploitative against users. If a transaction is encrypted until it's included, no one gets the opportunity to "wrap" it in a hostile way.
The technical challenge is: how to guarantee validity in a mempool-friendly and inclusion-friendly way that is efficient, and what technique to use to guarantee that the transaction will actually get decrypted once the block is made (and not before).
## The transaction ingress layer
One thing often ignored in discussions of MEV, privacy, and other issues is the network layer: what happens in between a user sending out a transaction, and that transaction making it into a block? There are many risks if a hostile actor sees a tx "in the clear" inflight:
* If it's a defi trade or otherwise MEV-relevant, they can sandwich it
* In many applications, they can prepend some other action which invalidates it, not stealing money, but "griefing" you, causing you to waste time and gas fees
* If you are sending a sensitive tx through a privacy protocol, even if it's all private onchain, if you send it through an RPC, the RPC can see what you did, if you send it through the public mempool, any analytics agency that runs many nodes will see what you did
There has recently been increasing work on network-layer anonymization for transactions: exploring using Tor for routing transactions, ideas around building a custom ethereum-focused mixnet, non-mixnet designs that are more latency-minimized (but bandwidth-heavier, which is ok for transactions as they are tiny) like Flashnet, etc. This is an open design space, I expect the kohaku initiative @ncsgy will be interested in integrating pluggable support for such protocols, like it is for onchain privacy protocols.
There is also room for doing (benign, pro-user) things to transactions before including them onchain; this is very relevant for defi. Basically, we want ideal order-matching, as a passive feature of the network layer without dependence on servers. Of course enabling good uses of this without enabling sandwiching involves cryptography or other security, some important challenges there.
## Long-term distributed block building
There is a dream, that we can make Ethereum truly like BitTorrent: able to process far more transactions than any single server needs to ever coalesce locally. The challenge with this vision is that Ethereum has (and indeed a core value proposition is) synchronous shared state, so any tx could in principle depend on any other tx. This centralizes block building.
"Big FOCIL" handles this partially, and it could be done extra-protocol too, but you still need one central actor to put everything in order and execute it.
We could come up with designs that address this. One idea is to do the same thing that we want to do for state: acknowledge that >95% of Ethereum's activity doesn't really _need_ full globalness, though the 5% that does is often high-value, and create new categories of txs that are less global, and so friendly to fully distributed building, and make them much cheaper, while leaving the current tx types in place but (relatively) more expensive.
This is also an open and exciting long-term future design space.
https://t.co/CdpE9ugFxE
We should be open to revisiting whole beacon/execution client separation thing.
Running two daemons and getting them to talk to each other is far more difficult than running one daemon.
Our goal is to make the self-sovereign way of using ethereum have good UX. In many cases that means running your own node. The current approach to running your own node adds needless complexity.
Short-term, maybe we want some more standardized basic wrapper that lets you install dockers of any client and make them talk to each other easily? Also good that @ethnimbus unified node https://t.co/BWpU939wIM exists. Longer term, we should be open to revisiting the whole architecture once @leanethereum lean consensus is more mature.
Whoa, BTC showing a discount on Coinbase right now is actually wild ๐ Could we really dip back to $76K before the next leg up? Honestly might be the buying opportunity we've been waiting for. #Bitcoin
The Clarity Act markup is happening and BTC didn't even flinch ๐ honestly that kind of stability during regulatory news is lowkey bullish to me. Markets are maturing fast! #Bitcoin
USDC is becoming the standard across crypto markets.
Coinbase is deploying USDC on @HyperliquidX to help grow the ecosystem and scale how capital moves.
Hyperliquid.
Leading Ethereum stewards @Consensys and @ethereumJoseph have joined DeFi United with up to 30,000 ETH in financial support for the rsETH recovery effort, with ongoing strategic advisory from @Sharplink.
Their contributions are a substantial component of the broader DeFi United effort to restore rsETH's backing and normalize market conditions, and the recovery would not be progressing as it is without them.
DeFi United.
Deposits for $INJ are now open on @BinanceUS, with staking coming soon!
Trading on the INJ/USDT pair will begin on May 14 at 7 a.m. EDT.
@injective is an L1 blockchain built for finance and supports an ecosystem of projects spanning DeFi, RWAs, prediction markets, and AI apps.
Nakamoto is bleeding cash but pulling in 6x more revenue than before โ that's actually a bullish sign for a growing Bitcoin company ๐ The losses now could mean massive gains later. Building takes time! #Bitcoin
tbh the market just needed an excuse to dip lol. Xi drops some words about Taiwan and suddenly SOL bleeding, BTC under 80k ๐ฌ geopolitics hitting different rn. hodling tight tho #crypto