How ZK Will Shatter Social Media Monopolies | Alex & Stani

The future is multi-chain because just like the internet cannot be built on a single server, the internet of value cannot be processed by a single blockchain. No matter how powerful, no matter how much you're willing to give up decentralization, it's just not going to happen. For political reasons, for social reasons, people want to have different systems adjusted for different needs. For technological reasons, you cannot do infinite parallelism on a single chain. Like even if you do optimistic parallelism, like like Solana, uh, is doing, or Monero is doing.

Scary stat for you: the odds of falling victim to online crimes are 1 in 4. Aura provides digital security protection to keep your personal information, passwords, online activity, and technology safe from online threats. For Empire listeners, Aura is offering 14 days free plus up to 55% off an Aura subscription when you visit aura.com/blockworks. Terms and conditions apply, see site for details. You'll hear more about Aurora later in the show. This episode is brought to you by Avalanche. Avalanche is a leading network of blockchains giving some of the world's largest financial institutions new use cases and business models while leveraging completely customizable infrastructure. Check them out. It's core.app/discover. You can explore Avalanche's subnet ecosystem at core.app/discover. I was playing around earlier today. Really cool. Are you tired of high gas fees? I'm excited to let you know about SKALE, a zero gas fee modular blockchain that's become a perfect fit for gaming and AI apps because of their instant finality and lack of MEV. Explore the SKALE ecosystem today at scale.space/ecosystem and stay up to date with the gasless blockchain on X @skale_network. That's @skale_network. Big thanks to SKALE for sponsoring Empire. All right, everyone, we've got a timely episode. We've got Stani, uh, founder, co-founder, I forget which one, Stani of both Aave and Lens protocols. Uh, and Stani, you can correct me if that's wrong. Alex, uh, co-founder of Matter Labs, uh, as well as one of the creators of zkSync. So Alex, Stani, hopefully I got those intros right. Uh, welcome to the show.

Thank you. Excited to be here. Yeah.

Thank you so much for having us.

Yeah.

All right.

So last week or week before, you guys announced Lens Network on Ethereum powered by zkSync. That's— I wanted to bring you two together. Alex, there's a bunch happening in the Matter Labs, ZK, not only the zkSync world, but just ZK in general. Stani, you guys have a bunch going on with Lens. Stani, maybe you can tee up this conversation with just the backstory of Lens and why you guys decided to launch Lens Network. You guys launched 3 years ago. I think it was initially built on Polygon. You made this shift over. Like, tell us the story here.

Yeah, what we're trying to achieve with Lens is to create open and fair social spaces. And we kind of all can agree that today we're living in a world or in an internet where social networks or let's say social spaces are governed by large corporations. And the users are kind of like the product there. So we create this big bunch of data and we give this data for free for the platforms. And the platforms are creating better algorithms to feed advertisements or monetize out of the users in various shape or form. What we want to do is that we want to take some of these social networking primitives like identity, social graph, and publishing, and basically make those primitives owned by these users by using on-chain. And the way we do it is that the way, for example, Bitcoin is securing money and Ethereum is kind of like securing programmable money and other types of primitives. We use on-chain to secure your identity and the connections you make on a shared and open network that anyone then can come in and build their applications. So over the long run, what we're betting on is that as more people come and build to an open network where resources are shared, the users will benefit more because they have more control and more choice which applications they want to use without losing their identities and followers if they choose to change an algorithm or an application. So that's in short what we're doing. And yes, we launched in the beginning on Polygon, and this was the time before, for example, even rollups were considered as a scaling solution for Ethereum. And now we're living in a rollup environment where most of the transactions are now happening on L2s, optimistic rollups and ZK rollups. And I'm sure Alex has a lot of opinions on how to scale from the rollup perspective and how ZK plays a role there. But what we actually are doing now is that we're using Palladium as a way where we can have this kind of like a modular blockchain environment and scale towards mainstream usage. And mainstream means obviously millions of transactions. And that is something that we can't do necessarily in existing L2s and rollups as an example.

So if I'm trying to think about the technical decision to move to make to when you guys launched Lens Network, why did you Why did you need to, like, why did you need to make this decision? And I guess, like, if I'm thinking about this from like the founder seat at Block— like, let's say Blockworks, like, we use, we use HubSpot for our CRM. We wouldn't just switch to Salesforce because like Salesforce has these nice features. There'd be like a problem that pushes us to then go build on, on Salesforce, right? So like, it's a pain in the ass to get off of one thing and to go change architectures. So like, what was the problem that you guys were facing that like forced you to move on to a different architecture?

In the most simple way, the challenge for us was scaling. So traditionally, like if you think about how social networks are built, they're using client-server architecture. And that basically means that you can scale as much as you want to as long as you add more servers, basically more fleet in, let's say, AWS or Google Cloud. But that means that that data is somewhere on a particular server governed by a company that owns that account. For example, a social media platform. In our case, we're using on-chain to actually ensure that there isn't a single party, a platform that owns the user data. And that data is basically governed by the users itself and they own it. So anyone can come and build these applications and algorithms and users can then choose without losing their identity and leaving everything behind. So we kind of like are building in an environment that isn't a walled garden. And to use something like on-chain, it also means that there is a cost. And this is a typical challenge that, for example, Vitalik described as the blockchain trilemma. So for example, The hardest part about blockchain is that the scaling part. So you have the scaling, decentralization, and the security. So if you want to have more scalability, you're sacrificing security or decentralization, as an example. And I think the existing challenge for us was that we're applying too much of security to some of these primitives that we have, for example, publications or the identity piece or the follow graph that we don't necessarily need at the moment. And that means that with what, for example, we're looking for scaling is that what is the amount of security that we need to secure identities in your network that you create on chain without actually giving that control to one single platform.

Alex, maybe I can pick on you and Stani. Actually, I'll circle back to you because I want to learn more about like the— I'm sure I want to hear about looking at other things and how you guys make this decision internally. And there's the technical decision, but there's like probably the ecosystem and like community alignment decisions. I'll get back to you on that stuff. But Alex, I've actually— I've heard you talk a couple of times about like ZK is the endgame for scalability. And I think the idea here is that like if you, if you break down the core functionality of Ethereum, it ultimately comes down to verifiability and that ZK is the endgame to solve verifiability. So maybe you can expand on this thesis that you have.

Happy to. And I want to go back to what Stani has said, that Lens is giving the power back to individuals, taking it from the corporations, from big centralized actors. And this is what crypto is supposed to do. And this is what crypto is doing at all levels. And this is what made Ethereum and Bitcoin so powerful, like the force of the social The societal force today, like in the political sense, in every sense, it's really the ability of every single individual to enforce their rights, to enforce their ownership of their assets, to enforce the playing in the fair rules of the game with everyone else. This is only possible if every single individual can verify what's happening on chain. And can only stay on the chain that is following the rules. Like, you know, your, your ownership of the keys is strictly enforced. Every rule of smart contract is enforced. No players that are more powerful than the others can arbitrarily change the rules of the game. And for this to happen, we really, really need to preserve this verifiability property that Bitcoin and Ethereum have, and that rollups were constructed were designed for specifically to enforce, to derive 100% verifiability from Ethereum. And basically, it's only possible with something at scale that enables a single individual to verify the entire chain. Because otherwise, you're going to be making concessions. You will be able to verify your part, but someone else, you need to rely on them. And then you have to extend trust. Multiple hops and that becomes a huge mess. Then eventually the power ends up again in the hands of big centralized corporations. Zero-knowledge proofs, succinct zero-knowledge proofs, SNARKs, is the only technology we have today that can do this job at the scale of billions of people. Where— and like, I'm not talking theoretical, like this is a very practical reality that is happening now with zk-rollups. And with ZK networks. You can run thousands of chains together in parallel, each operated and owned and, and, you know, like enforced by their own entities and validated by their own entities and groups of people. You can produce your knowledge proofs for all of them. Then you can recursively combine them and synchronize using a single settlement layer such as Ethereum. And I believe that Ethereum is by far the most decentralized, the most resilient, and also the most compatible with this culture today from all the smart contract platforms that can verify zero-knowledge proofs. And I believe that this will remain this way. And what you can do is you can have a single chain that verifies all of these millions of transactions of billions of people on thousands of chains, having everyone in the world be able to come to a consensus of what the state is, who owns what, what computation happened, and what rules were enforced, and then arbitrarily access any part of this data. That is possible with zero-knowledge proofs. And, and, and this is what zkSync is building. We're building for unlimited, perfectly elastic horizontal scalability.

Alex, can you just expand? I think I followed all of that except for I don't think I understand the full why of like, I think your argument is anything without zero knowledge proofs introduce a couple of things like you introduce trust assumptions, lower security, and I think you would make the argument probably even lower throughput in the future. Can you just expand on like why that is the case?

Sure. So like what makes Bitcoin and Ethereum verifiable is that every single participant can make sure that the entire chain is operating correctly. How do they do this? Very simple. Everyone verifies everyone else. We have this don't trust, verify maxim from Bitcoin. So what everyone does is they have the full node, they can run it on their laptop. Luckily, Bitcoin and Ethereum both support very low hardware requirements specifically so that you can run it on your laptop. You don't need some like super powerful cluster in the cloud that you have to own, etc. No, you run it on the laptop. But then you download all the blocks that contain all of the transactions from all other participants, and you rerun them. So if we have 100 participants, each of them verifies 100 transactions, like, and everyone does one transaction, let's say, per hour.

You—

everyone has to verify, uh, 100 times a single transaction. So overall work we're doing is like 10,000x. Of a single transaction. If we have 1,000 participants, then everyone has to verify 1,000 transactions, and so the overall work becomes like 1 million next single transaction. If we go into the million users, million transactions territory, then the square of that is going to be like 10 to the power of, uh, of 18, like the huge numbers, right? So like this approach fundamentally, inherently does not scale. You cannot have everyone in the world rerun computation of everyone else doing their own stuff. Apart from the fact that you should not maintain the state of all the value, you know, contracts and assets of everyone else in the world. You should only care about your piece of the state, your balance, your NFTs. Your social identity credentials, etc. So like this approach just does not scale and everything else like we, the rest is a big open space of research and development of scaling protocols. And all of them have been falling in like have been like hitting against the blockchain trilemma. They were trying to increase the throughput, but then they were forced to compromise either on security or on decentralization or like actually on both. You have a limited space, like you have a limited available hardware capacity of a single laptop or a single smartphone. You just can't fit more there. So either you have to trust someone else or you need some magical trick. And zero-knowledge proofs give us this magical trick. And that's, that's the only technology that we have today. Maybe tomorrow we'll invent something else, but nothing is even, even close on the horizon. What your knowledge proofs enable you to do is to take a huge computation, compress it into a very, very small piece of data, and then let everyone in the world verify it with a smartphone in less than 1 second. It's a very— it's just a small number of very simple algebraic operations that you have to perform on this piece of like 1 kilobyte of data. And you can verify arbitrarily large computation. Can be 1 million transactions, can be 1 billion, 100 billion, 1 trillion. It doesn't matter. There are no fundamental limits on what you can verify. And there are also no limits on, on how much data, how much proofs you can produce. Because all of these proofs for all of these transactions can happen in parallel. They, they don't have to happen on a single server by one single entity on a single blockchain. No, you can have like any arbitrary many participants producing their proofs and then like slowly, gradually combining them together until you have one single proof. You put it on Ethereum, then you verify the proof of Ethereum itself. We are coming very close to a state where zero-knowledge proofs will be— we will be able to produce a proof of validity of an Ethereum block, and we can recursively connect it to the previous block. And this enables us to verify proofs of the current state of Ethereum, the, the most recent block, And we guarantee the validity of this block from genesis, the entire chain, and the validity of all the chains that settled on Ethereum. And basically every single smartphone in the world will turn it into a full node of Ethereum, deriving 100% verifiability from the base chain. Like, to me, this is fascinating.

And this is fascinating because right now you can do light nodes, I think, on mobile. You can read the header or something like that on mobile right now.

Exactly. But like, like running a light node is essentially trusting the validators, right? And this is a reasonable trust assumption if you're doing some small transactions, you know, but like you have to be conscious that you are giving up control, you're giving up power, you're empowering, right? And maybe now it doesn't feel scary, but over time, if everyone keeps doing that, we'll end up in the same situation as, as we are with Web2 and Web2 socials. This is exactly what happened. Remember the time when Google was empowering people or Facebook was empowering people? All of a sudden you could connect with your friends and do like all things.

Don't be evil.

Don't be evil.

Don't be evil. Don't be evil.

And, but over time, like the more concessions you give to them, the more powerful they're going to become. And this is why we're so excited about Lens because Lens takes the user ownership and the user empowerment of the users extremely seriously. We don't see this happening in the, like as much in the Web2 world. Like, for example, in Lens, every single, like the entire social graph is on chain. You really own your profile. You really own everything that's happening there.

Yeah.

So we're absolutely values aligned in this regard with the Lens team and could not be more pumped.

Nice.

I kind of, you know, explain it in a way that like, whereas like these bigger companies that were built on the success of the internet, like Google, and the whole phrase of like, don't be evil. What ZK is doing and also fundamentally blockchain is just creating that can't be evil setup actually. And I think that's like a powerful, especially because we talk today quite a lot about like, you know, Web 2.5 and think about like, okay, what's, you know, what actually, what are the use cases of the blockchain, you know, besides finance and These are the choices that we also at Lens, we have to think about. And especially when it comes to scalability, because there are limitations of how much you can scale with Ethereum security setup, or let's say a roll-up security setup, whether it's like Optimistic or ZK. And then more like of these modular approaches where you can use, for example, Validium. So how can you actually add the progressive amount of security for your your own use case. And if we have that like a progressive approach to security and scalability, then we have these different use cases and we can actually create these security setups where the users can own the data and we don't have to trust the platforms. And there's, we can mitigate the actual risk of some one big kind of like a server becoming the main place of data. And there's a risk of that server becoming actually then something where that's something that becomes a walled garden. And I think this is kind of like a fundamental difference of like what is in terms of like the values for the Lens team and also the MatterLabs team, like how we can actually avoid down the line all this kind of like a power shifting back to these companies that are building online. And I think that's happening already on AI significantly. Like if you look at the AI space, these biggest large language models are built by these biggest tech companies and they have the resources and the power to actually do that. But most significantly the data as well. So kind of like how we can create these safeguards by using on-chain and ZK is really what is driving our thinking here.

Nice. Stani, can you take us behind the scenes of like actually making this decision? Because ZK Matter Labs has built something great, but other people have built cool things too. Like there's the OP Stack and there's Arbitrum Orbit. And then maybe there's, you know, those are kind of like the L3 stacks, I'd say. Then there's like Cosmos Appchains. Then there's some of the ZK players like maybe Scroll or I think Starknet or something like that. Like, walk us through the, the actual, like, thought process and discovery and, like, demoing these other things.

Yeah, I mean, the landscape is really, um, I would say quite wide at this point, and these different technologies that exist, it really gives a headache to, to think about, like, what you have to choose. And most of the developers that maybe are in the position of choosing their technological stack, maybe the main driver for them, for example, is that they just need where a L2 or a solution where they have, let's say, the most of the users. That might be an L2 that has most of the users that are— that is basically most developed at this point. For some, it might be something else where you want to have faster exits from an L2 where maybe waiting 7 days is too long for your use case. And maybe something like a ZK setup is better. But fundamentally what surprised me over this few-month process is that, I mean, I've known Alex for a few years now and what they've been building has been quite exciting. But more like, I would say like a year, over a year ago, year and a half maybe, I've personally been surprised of the progress of EVM-compatible ZK rollups or like EVMs, which has been kind of like progressing quite quickly. For me, that was a very big surprise. So the speed of how the ZK technology is progressing at the moment is really rapid. And that means that the more ZK improves, the more data can be compressed, the better compression techniques can be used, and also the underlying infrastructure as well. So what Alex mentioned about thousands of chains and being able to cross-verify, it's actually something that's, it's called horizontal scaling. And that really enables a lot of that. Scaling of infrastructure and use cases. So for us, it was like a very big of a, much of a question is that what is the infrastructure where we can apply a progressive security towards our use case? And when you look at fundamentally what Lens protocol is and Lens ecosystem, it combines of two pieces. So one big piece is social transactions. That users are creating. For example, they're creating their identity following other users. So linking with other identities, then for example, tokenizing content in form of NFTs. But also there is the monetization aspect. So for example, once you have that audience, you can start monetizing. So you can monetize your follows, your content as collections, or tipping as an example, or through open actions. You can actually have directly on the feed different kinds of actions that are on-chain or off-chain. For example, an action to vote on governance can be on-chain, on your feed, or voting on Polymarket, or doing a Uniswap swap directly on the feed. So, and I do believe that a lot of these dApp-specific use cases will go directly onto the feed because we're we're kind of building everything on the same network, wider network, the on-chain network. And that hasn't been the case, for example, on these more traditional social networks where the social behavior is the main thing. And then you have maybe like groups where you might have like Craigslist types of commerce and whatnot. So for us, what we really wanted to achieve is that So for all these different primitives and use cases, we can apply the amount of security that is sufficient. And then with that, we have the scale. So what we found out that with the MatterLab stack, you can actually have a ZK rollup that is settling transactions and the state to Ethereum. So that's perfect for, for example, financial transactions where you wanna secure a lot of value. Then you have also a Validium setup where you are registering the state transitions into Ethereum, but you actually are storing the state somewhere else, either the Validium node and later expanding to a node network or using a separate data availability provider. And once you do that, once you actually select a different security model and type for the data availability, the transaction costs actually go significantly down. So for example, running something like Lens, let's say creating profiles could work on a ZK rollup, on an optimistic rollup. But once you get to a bigger scale, you're going to hit some scaling issues there, but it's doable. But then when you want to use on-chain to actually secure the linking between profiles, you have way more transactions. And then that's where you hit the second, much more bigger bottleneck for scaling. So that part has to be, for example, on something like Validium. And then obviously you have all these micropayments where, you know, you might have a use case where you scroll a feed and upon each scroll there is an event that triggers a micropayment from the users to the applications and the algorithm. Or various different payment mechanisms that really will not be efficient if there will be— if you're paying like 40, 50 cents per transaction, or even like 5 cents per transaction as well. So for us, it's mainly about finding the right setup where— technological setup where you can have that— those financial transactions, whether they're bigger and small, depending on different setup, and then the social transaction. And social transaction is interesting because most of the actual content is off-chain on Lens. So they are already on a data availability layer. So for us, it's not a completely like a foreign setup for us. And then the one big decision obviously is that, well, you have optimistic rollups that are, are having a head start already for a couple of years. How do you create those network effects when you go to and utilize completely new technology? But the way we see it is that eventually everything will go towards the ZK technology. So maybe Alex has more on this topic, but what our research was telling is that eventually ZK as a scaling mechanism verification mechanism is something that is going to be far more powerful than the optimistic setups. And these optimistic setups will eventually convert to ZK-based setups because the better technology will prevail end of the day. So we wanted to go where the whole industry will go in terms of like technical advancements in the future and be there early and actually build some of these pioneering setups and primitives and lead by example. So I think that's kind of like the thing. But, but I do think it's a very difficult choice for any developer that is choosing a stack, where to go and what's, what scaling solution, but also which ecosystem to build upon.

This episode is brought to you by Aura. Online crime is growing at an alarming rate, and cyber criminals continue to find Crypto investors like the Empire community, lucrative targets. We've all heard of someone who's fallen victim to some sort of online attack. Aura helps prevent against that. For example, if your online accounts or your passwords were leaked online, or if someone tries to open a bank account in your name, you'll get notified in real time about that. With 24/7 US-based support, Aura's team will be there for you to resolve fraud issues, even if it means getting on a three-way call with your bank at midnight. Not saying I had to do that, but I might have had to do that. So aura.com/blockworks, sign up for the 14-day free trial. Terms and conditions apply, see site for details. Aura is the new standard in digital safety. Check them out, aura.com/blockworks, free 14-day trial. This episode is brought to you by Avalanche. Avalanche is a leading network of blockchains giving some of the world's largest financial institutions the design space to explore new use cases cases and business models while leveraging completely customizable infrastructure. Everything that Avalanche has been building the last few years has culminated in this moment where today you have institutions and developers able to essentially have limitless possibilities with the chain. They've enabled developers to build cross-chain swaps or create gaming environments where one subnet can unlock features in another or can use USDC as a native gas token. Onyx, for example, by JP Morgan or Citi or DTCC's digital assets or the Australian New Zealand Banking Group. They're all building on Avalanche Evergreen subnets. Really cool stuff. Big thanks to Avalanche for sponsoring this episode of Empire. Go explore Avalanche subnet ecosystem at core.app/discover. That's core, C-O-R-E,.app/discover. Thanks again, Avalanche. Hey everyone, Jason Yanowitz here. I know you've been hearing a lot about the intersection of crypto and AI, and that's why I'm really excited to share our newest partner and sponsor at Empire. Scale, a high-performance modular blockchain that's revolutionizing gaming and AI with zero fees and instant finality. Scale's unique architecture allows for massive scalability and has already saved users over $6 billion in gas fees. The 5 main takeaways that you need to know for Scale: 1, zero gas fees. 2, Scale has instant finality and lack of MEV. 3, the zero gas fee model of Scale is really important. For blockchain gaming adoption as gamers don't have to pay transaction costs or have the SKL token. 4, SKALE is multi-chain. This design allows for nodes to be combined to create chains and for individual subnodes to actually be removed and relocated, which creates greater security and collusion resistance. And 5, SKALE has become a really good fit for AI dApps because they're fast, automated, zero-fee transactions. Big thank you to SKALE for sponsoring Empire. We're excited to partner with you guys. Bridge over to SKALE if you're listening to this at scale.space/ecosystem. Follow the journey along with SKALE on X @skale_network. That's @skale_network. Big thanks again to SKALE for sponsoring Empire. Alex, can you just, um, maybe zooming out of the Lens conversation for a sec, I'd love to just learn about like Matter Labs' strategy and let me maybe share the 15 seconds on what it feels like from an outsider's point of view. So it feels like you guys have, are extremely technical people who have not been as focused on like the marketing and BD side as a lot of the other networks have been. So there are things like maybe Arbitrum, Optimism, Polygon, Starknet. They all have tokens. So like one is you guys don't have a token yet. A lot of them already have a token. And then the second thing is I think they— a lot of them have done a lot of work trying to pull people onto their onto their chains, whether it's the kind of like last cycle strategy of getting the big enterprises, which for the most part flopped, or maybe, you know, Farcaster on OP Stack and Base or Fantasy on Blast or whatever it may be. A lot of them have these kind of like booming DeFi ecosystems. I don't really see that as much on zkSync. It feels like now is kind of the turning point for zkSync. So that's the outsider's point of view. I'd be curious how much of that you agree with.

So look, the way we see, we kind of treat the strategy is we are thinking very long term. zkSync has a powerful mission to advance and protect freedom in the world by making blockchains mainstream, by making Ethereum mainstream. So we take this ultimate vision and then we reverse engineer from there what has to happen technologically in the world to achieve this mission. And then we build the all, all, all, like, kind of like our approach or planning down from there. And it's very clear to us that the future is multi-chain and the future is all ZK. Like, the future is multi-chain because they, just like the internet cannot be built on a single server, The internet of value cannot be processed by a single blockchain, no matter how powerful, no matter how much you're willing to give up decentralization. It's just not going to happen for political reasons, for social reasons. People want to have different systems adjusted for different needs. For technological reasons, you cannot do infinite parallelism on a single chain, like even if you do like optimistic parallelism, like Solana. Is doing, or Monolith is doing. So like, there will be many chains, and we already see this. There are many chains governed by different approaches. So what you, what, what you really need to, to have is a multi-chain system, multi-chain world that can scale like the internet. Anyone can add a chain permissionlessly, and anyone can join and participate in this huge network of chains. And then the interactions feel seamless for the end users. As an end user, you should not be thinking about like, oh, I am on this chain. And like, you give me this address to send your funds in, but what chain are you on? Do I need to bridge funds over there? Is my wallet compatible? Like, all of that has to be abstracted away. There must be a single unified address standard. And you should not care. You have your assets on your home chain. You should be able to interact with application-specific chains or other generic chains, just like on the internet, you know, you just interact directly from point to point to that, to that single address. So this is the end vision technologically, architecturally, that we have to get to. And realistically, it's like most of the chains are going to be at least initially EVM-based. So it has to be something like ZK EVM that that supports the contracts written in Solidity on Vyper that you deploy there. So, okay. So that's the vision. Now, can we arrive at this vision incrementally? Can we take the existing landscape of optimistic rollups and maybe sidechains or other scaling approaches and then gradually convert it into the ZK-based world? And like my answer as an engineer is no. This is not going to work. Like, I predict that it's, you know, most likely Optimistic Rollups teams that will want to embrace ZK in the future will build new systems from scratch and will have users migrate to those systems. Because the complexity of adjusting an existing system designed for specific set of constraints often exceeds the complexity of building this new system from scratch. Think of zeppelins that were replaced by planes. Think of propeller planes that then later were replaced by jet planes. Those were paradigm shifts. You cannot just take a zeppelin and put wings on it. You cannot take a propeller plane and put a jet engine on it. This is not how the world works.

PlayStation 1, PlayStation 2.

Yeah, like you have a transition. You have to abandon old, old, some like, you Sometimes there is an incremental improvement. Like we can start with zkEVM and we can add different execution environments and we can support RISC and then like let Rust programs be run on it and we can compile it from Rust into RISC and execute on the zkEVM. But if you're not building for zkEVM, like the transition from like crypto economical scaling approaches to zkEVM to purely cryptographic scaling, and verifiability is a step function. It's, it's a paradigm shift, and like, it won't be possible to just replace. So what, what's possible is to design a new system from scratch, like taking this ultimate ZK singularity, the verifiability that is fully elastic, that can incorporate any chains, and build right away for this infrastructure. And this has been our approach. We're ignoring the short-term hype. We're ignoring all of this noise. That doesn't matter. We're very, very early. How many people are actually transacting on chains? You know, like we have millions of crypto users, crypto owners, but frankly, most of them are on the centralized exchanges just trading Bitcoin, Ethereum, and a bunch of tokens. Much less people are on-chain because the UX sucks and because we don't have these protocols. Basically, UX is the biggest bottleneck. And so we ignored all of it. We said, okay, we like, when we launched zkSync Era, the first zkChain in this network of chains that we're building, we delayed it until we had native account abstraction. Because we realized that it's very important for the end users to onboard with, you know, not only build something that the existing powerful crypto, like crypto power users will be able to use with MetaMask, etc. But to build something where you can onboard your parents and your grandparents and just give them a wallet and say like, look, here, one click, one tap, Face ID, Touch ID, you have your account. It's still yours. It's still fully self-custodial. You own it, but it's very, very easy to use. You cannot forget your seed phrase because you have social recovery. You cannot accidentally lose all of your assets because you signed one wrong transaction and authorized, you know, infinite amount of, uh, um, like infinite approval for an ERC-20 token because it's just so inconvenient because you otherwise you would have to do multiple transactions. Like, we need to solve all of this UX complexity before we onboard mainstream users. And so we're building the, the right architecture from the start that will absorb all of this new demand just because it's going to be so much easier, so much more fun to use, and so much more safe to use.

Yeah.

And I want to say that part of the UX is really the transaction costs. So if the transaction costs are going to go down as we learn how to apply progressive security and also we introduce more and more ZK proving techniques, that basically opens up the door for bigger audiences. And something interesting about the whole landscape is that none of the kind of like ecosystem, really ecosystems that we've seen in our space, they don't really own the users. There's no loyalty towards being on specific chain or ecosystem and they have different kinds of reasons. And I actually can say that even the acquisition of existing users is relatively easy. Crypto, early crypto audience and the audience we have today, they're quite eager to try different things. So they're eager to try new rollups or new technology, but like obviously the retention is what is kind of like a chronicle challenge in our space. And that's why like we have to go towards more of the mainstream audiences. And it's not just because that's where we get the users, but these technologies that for example, we are working on Lens, and also what Alex and their team is working in, in Matter Labs, these technologies are meant for the people in a global scale. So if you actually can have a technology and you can verify and scale globally these use cases and create open, fair social spaces for the mainstream, like then we're in the correct path. Before that, like I think the users which just follow where you know, the next technological advancement is, or, you know, the next kind of like arbitrage opportunity. And I think down the line we have to just work on that UX aspect.

Stani, can you tell me about Aave? So like switching gears to your, to the other one, I saw that you tweeted out Aave Network is planned to come after v4. Actually, it was a pretty interesting Mark Zeller tweet. Fun fact, if Aave were a layer on its own, It would be the largest Ethereum layer with a market size of $20 billion. It would also be the third largest chain after Ethereum and Tron. Will— I don't know if this is public or not, or if I've missed any blog post or anything, but with Aave Network, will you also build that on zkSync?

Well, eventually. I mean, zkSync is the technology we've reviewed most until this point, and we reviewed other networks as well. So I do think that Like in overall, if you think about DeFi and securing what you mentioned, like $20 billion worth of value or that ballpark, like at that point you have to ask yourself is that what is the underlying security that these funds are secured? And it boils down to eventually on the methods and obviously the data availability where it's secured. And obviously the benefit of rollups is that you can inherit the security from Ethereum. So what I can say about the ZK Stack and ZK-Sync is that if you use actually proven mathematics to secure the network, secure the data and verify, and then use those verifications and store in Ethereum, you have a very strong set up for decentralized finance. And the drawbacks of, let's say, optimistic rollups is that, and by the way, I think both of these are really needed at this point. And I'm pretty sure like a lot of these teams that are building optimistic rollups, you know, they all have some sort of a ZK future plan. But I think what's the challenge with optimistic rollups in DeFi is that obviously you need to have some, additional trust assumptions with the fraud proving as an example. And then you have the withdrawal windows of 7 days. So you need to add that kind of like either trust assumptions or some sort of like staking type of security overhead into that environment. So I do think that for DeFi, I would say that the best environment will be some sort of a ZK-based rollup where you have like minimal trust assumptions and also overhead of, let's say, security staking. But that's something that eventually is up to the decision of the Aave DAO. And the Aave network is basically part of this bigger Aave 2030 proposal of where we're proposing to build the v4, which is further optimizing the Aave as a liquidity protocol infrastructure and making it just more advanced in terms of getting the best yield with the most leanest collateral that you bring to the protocol, or if you're other side of the risk spectrum. And Aave v4 itself has so many different new features that I'm not going to go into it, but But that's a great example of thinking where DeFi should go from here. And if DeFi is gonna have, it's now roughly $100 billion worth, but let's say if it's gonna be multiple trillions at some point, what are those, what kind of security assumptions we can take or overhead to secure and have a secure infrastructure for a financial ecosystem? I do think rollups do reduce the cost of transaction, transactioning, which is really important for DeFi because that creates access, you know, and access creates adoption and that creates more fair and better financial infrastructure.

Alex, when you think about building out the ecosystem, so you've got Lens now, if you could go get like 2 or 3 more big I guess, like brands or platforms to go build on zkSync? Like who, who would be your kind of dream brands or like what types of folks would be the dream, the dream customer here?

We have already a dozen of zkChains lined up. Some of them were announced, some of them like Cronos and Gravity, for example. Cronos has built the largest DeFi ecosystem in Cosmos. They are supported by Crypto.com wallet with close to 100 million users, I believe. We have others coming that are still not announced and they're coming announcement very soon. And so like we already are forming a system, a network of the ZK chains that is going to be the largest in today's Ethereum scaling landscape.

I don't know who to ask this question to, but I would actually love to talk about something Stani mentioned in the very beginning of the show, which is decentralized ML or like the broader topic of crypto meets AI. So anyone can answer this, but like hype, not hype, really exciting, several years away or 1 to 2 years away. Like, we'd love to hear, I guess maybe both your guys' broad perspective on just like what's hype, what's real, what are you guys excited about in this area?

Yeah, I mean, I do think that especially like these large language models, they have a lot of utility and it's really fascinating. Like I'm more observing from like the AI, like maybe a little bit from the other perspective of like automatization and kind of like a better human decisions perspective. And there's gonna be tools around that in the future that we are researching. But from the Lens perspective, is really fascinating because the way I think about, let's say, financial, finance on chain, or like DeFi, is that you really contribute financial value, let's say like liquidity, and you put that capital into use and the outcome is yield as an example, or some sort of increased value. And in Lyn's perspective, that's, you know, there is this financialization and you pay for attention and whatnot. But actually what is more exciting is that the data acquisition. So for example, like how do you share data and acquire data and then put it into use and produce something as an outcome? So what these language models, they really do well is that, they are very data hungry and they grab an enormous amount of data and then train these models. And that better model is kind of like the— when you put data into work as a result. And I find it really fascinating that from Len's perspective, the data is actually going to be in the future more valuable than, let's say, thinking of just purely financial capital. And then when you have that data, the question is how do you monetize and also incentivize in the first place, uh, for paying those data sources. So I'm looking more of the perspective of like how we can end this nonsense we have now where we have people giving up their data for free to these bigger platforms on an ongoing basis, and they grow this large train models and then use them against the users in a way to extract value out of them or make them more addicted to these different algorithms. And I think that's where kind of like the blockchain comes into play and Lens comes into place to basically ensure that if you have some of the ownership components and primitives and you own your network, you have choice, you can actually move that power away from from these bigger institutions to yourself and the community. And at the same time, you can, like, if we can turn the monetization switch on, on personal data, if you even want to share it in the first place, we can end this whole kind of like existing status quo where we're just giving all our data, you know, for free. We are not getting paid anything for that. And we don't have any, any say of it. Alex, what do you think?

And to add to this, my view is simple. Look, blockchains are going to permeate every sphere in the world that touches value. Everything that has to do with value, ownership, identity will be on-chain eventually. This is an inevitable next step of the evolution of the internet. Now, everything that is concerned with computation, intelligence, decision-making is going to be permeated by AI. That's also inevitable that this is happening. And so, like, you have these two spheres that are ever-expanding and embracing more and more of the realms of the physical and digital world. Obviously, they're going to intersect a lot. And whether this intersection is going to be direct, where you have some AI applications doing things on-chain and verifying on-chain that certain computation has been done on certain datasets and connecting this to on-chain activity, or whether they're going to be interacting indirectly just by the virtue of AI agents having some value and transacting on-chain, or humans owning, you know, having decentralized communities that own AI and that that have some say in how they govern the AI systems, how they fine-tune them. I don't know, but it's very clear that they're going to be interplaying in one way or another. So we're focused on our part. And, uh, yeah, we have already a couple, couple of teams building ZK chains on ZKSync, uh, with regard to AI, deploying AI-enabled, AI-powered applications on ZKSync Era. And I'm sure there's going to be lots of applications powered by AI building on the Lens network, because that has directly to do something with the user data and user identity. So lots of possibilities how these things will interact.

Alex, 3 years from now, is there more activity on zkSync coming from— you said all the world's value will eventually live on-chain, which I agree with. I bucket that into two buckets. There's places where there's existing societally assigned value. That's like finance. Like there's a dollar assigned to different things that have value. And then there's things that don't have a dollar assigned to the value, but probably will in the future. Maybe it's attention, maybe it's your own personal data. And I think that's more like you could almost define it as like Aave versus Lens right there. So like 3 years from now, will there be more activity on ZKSync? From the predefined society values? Like, I guess you could bucket that as DeFi or the like Web3 decentralizing Google and Facebook and things like that.

I think it's, it's going to be more of the latter for the very simple reason in the Web2 world, this is what we observe. There are a lot more transactions in social networks than the financial transactions. Just because the latter encompasses more spheres and more domains. So like, there are, yeah, just a lot more interactions will happen naturally between people than purely financial transactions, but they will be intertwined.

How do you think about appealing to a, like, who is your customer you're trying to appeal to? And the context for this question is, obviously, the tech matters. But then there's been this, the word community is like overhyped and fluffy and stuff like that. But there's a, I think people who have done, who have talked directly to a very crypto-native audience have actually done the best. And people who kind of talk at the institutional crowd or the like normie crowd have actually, with the goal of like onboarding the masses with quotes around that, have tended not to do very well. How do you think about like who you're talking to in the ZK-Sync marketing?

For us, we've been extremely consistent on this. We're from day one of the creation of ZK-Sync, We have declared the values we stand for. It's the cypherpunk Ethereum values. If you read our ZK Credo, if you see everything we've done, like from supporting the legal defenses of the Tornado Cash team to like every single blog post, every public statement we did is reinforcing those values. It's only valuable for us to scale blockchains to the degree of the real world, to like bring in mass adoption, if we can't preserve those key core properties that make blockchains valuable, if we cannot preserve them, if we don't ensure that these networks remain permissionless, open for anyone to access, censorship-resistant, resilient against powerful adversaries, then we might have just as well built it on top of, you know, Google and Facebook and on all the web2 platforms. Like, what then? What's the point of blockchain?

Yeah, and I, I really like, uh, want to double down on that. Like, that's the reason, like, why we're, like, building it in the right way, in a decentralized way, and where you can actually, like, establish ownership in censorship-resistant networks. And that creates, like, more value for the users. And I think, like, A great word to think about the zkSync ecosystem is quite similar to back in 2016 when I got into Ethereum and started to build actually one of the predecessors of Aave back in those days. It felt very developer-oriented, but then you started to see a lot of things coming out and a lot of experimentations. And I tend to see also that there's a lot of tendency now towards ZK in terms of also like what you can build. And for Lens, why this is like overly like fascinating, why our team is like very excited about building Lens Network on ZK-Sync is that it opens up the doors to broader category and ideas in the, ZK use cases. And that means in the future, for example, if you comment on someone else's post, you can prove that you have common friends. You can prove you reach a threshold of certain amount of followers and you have common groups without actually revealing which the data itself to any server, third party. That data doesn't really go, is not exported from from your position. And that's like a really exciting area of various different use cases. And when we think about Lens v3, data control and data privacy will have a very big significant importance and focus. So I do think that like we've built so much on Ethereum at this point, and we're still building in terms of like scalability as a wider ecosystem, but there is now actually more utility found from this new ZK, I mean new, but ZK technology stack. So I do think that over time, we just see Solidity developers to actually build more on ZK. And I think one of the core innovation that really made for us the decision a little bit easier is that When you have an EVM-compatible ZK rollup or Validium, it basically means that you take the code that you already have and you can redeploy it. You might have some smaller changes, but in most of it, you basically redeploy it. And that's distribution. So if you build something on Ethereum or like the L1 or other networks, you can easily port it and add also ZK-based features if you have use cases for, for example, privacy or other types of attestations. So I think it's really just a new world of building. And for me, like, I need always like an intellectual challenge. And I think we built so far with Aave and Lens today that being able to actually build around ZK is really, really fascinating as a builder. Yeah.

All right. Switching gears a little bit, putting on your, like, founder of protocol hat. There's interesting regulations going on in the US and, like, interesting, like, sea change, it feels like. So you've got, like, Trump came out and said he supports Bitcoin now and self-custody and things like that. The Biden administration seems like they're changing their tune. You had FIT21, I think it was SAB121, things like that, and an election. So if I look back at Permissionless last year, I think we had 37% of our speakers dropped out because they were worried about being on U.S. soil. Now, most of the big protocol founders are speaking. Alex, I think you're speaking there. Arbitrum founder, Optimism founder, like a lot of the, you know, Aptos founder, like a lot of the big Sui founder, like a lot of the— now, now everyone's coming to Permissionless and speaking. And so it's like I think that's shown me like, wow, how much has changed in just a year. Stani, you're from Finland, I think, and Alex, I don't actually know, but I'm picking up on the accent either like Soviet Union or Ukraine maybe.

I was born in Soviet Ukraine.

Yes.

Oh, so. Okay. So combined the combined two. So tell me how you guys think about the US right now and just like you're both, you know, I don't know what's more exciting, like Europe Asia, where there's a lot of activity, Middle East, where, you know, Tokenhead, their thing in Dubai, or is the US back? Like, how are you guys thinking about this as founders? Long-winded question.

I think one great thing that we see in the US with crypto is that crypto community has manifested itself as a powerful election force. It's clearly having an impact on the US politics now, on the election process. I guess we'll really see this in action after elections. But like, this is fascinating and it's only going to become stronger every year as millennials and Gen Z become more and more active in the electoral space. And yeah, like, for now we don't have a lot of concrete steps. The Fit21 has not yet been fully passed. And it's not also like ideal for crypto, but it's definitely going in the right direction. We will see. And I think it's also important for politicians to feel the consequences of the, you know, like not just switch the rhetoric one day before the elections and then roll it back, but like be held accountable for what they have been doing for years. And, uh, you know, like, feel that it, you know, the community remembers.

Yeah, yeah. And I, I do think that there's a lot of positivity, um, and progression, and I, I think it hasn't happened, uh, by itself. So, so there's a lot of smart people in, in the crypto community that have been involved in terms of like from their opposition or just basically being vocal about how big of a deficit it is for developers in the US or founders that really want to build this technology that is really bringing a lot of value for basically the people, the normal users, and done in the right way using different kinds of proven best practices, this technology can be really, really empowering. I think DeFi is just better financial infrastructure from all— like, it takes all the boxes for actually just like empowering users, giving more protection. It has the transparency. You can create rules that can't be changed by single entities. Like, you have that immutability, governance, And also from like Lens context and social, like you can create actually open, fair social spaces and users have more choice. They're not locked into the platform. So like these technologies are fundamentally really, really valuable for the users. And that choice really doesn't mean that it takes power from the governments. It's actually ensures that corporations actually, they participate in this environment in a more fair manner. So for example, if these companies in big tech, they don't have most of the control of the data, they have to listen more carefully for the users and their thinking as well. And I think it is fundamentally important. And obviously, the past year has been, past years has been really hard for a lot of people who are developing. And I think we lost a lot of innovation. And I do think that US is kind of like a significantly, you know, in a position of being a leader in the tech. And globally, those hubs are also growing in other places of the world. So like being able to actually recognize that this technology is really benefiting the people and thinking of like how we can implement that and be the leader is groundbreaking. I can speak so far from London where we're also based in the sense that there's a lot of positivity here as well. Obviously, institutions are looking into the space quite a lot. Hong Kong is another place as well where I've seen a lot of progress. So the technology in blockchain space is global, which makes it really exciting from like a democracy perspective. So I would say that the progression is great, but devil is in the details. So as with any bill and law, we have to ensure that it's written and proposed in a way that it's really actually doesn't kill the innovation silently. So I think that's The people who are working towards this direction and seeking for our values is really— they're doing the God's work here.

Yeah. Alex, Donny, great chat. Anything that you guys wanted to cover that we haven't touched on yet?

I think we didn't talk about meme coins, but I think that's actually good that we didn't.

I will admit after Kaitlyn Jenner came out with the Jennercoin. I'm meme-coin'd out, I got to admit. I have a feeling, Alex, I don't know you too well. I don't know you as well as I know Stani, but I have a feeling you're not a huge fan of the meme coins too.

So I prefer utility.

Yeah, they're a cultural phenomenon, like generally, like NFTs. Yeah, this is something community does. And, you know, like we have to embrace whatever is fun for people. Whether or not they're going to be long-lasting trends is a different question.

I do think that, you know, it's so easy to ruin the meme coin space, you know, with just flooding the market with a lot of nonsense. But I do think that meme coins that really find some sort of like a community around and a purpose and a utility, you know, that might makes sense from like a cultural value and also like some sort of utility perspective. But I do think that there's also like the challenging part that, you know, if people think these are some kind of like, you know, investment tools, then, you know, it's not going to be beneficial for the space, I think.

Yeah.

I mean, but also if you think about it from the philosophical point of view, isn't Bitcoin a meme coin?

In a sense. It is, but me also, but yeah, but at the same time Bitcoin transfers energy into a kind of unit. So like, that's the thing, I think there's, there's kind of like, there's some sort of a balance of both. Even like Dogecoin has utility to some extent where it just, it's cheaper to transact the same way as you're transacting on on Bitcoin. So I do think that like some of these more, um, kind of like if there is like a real community behind of the face value, you know, that, that makes sense as well. And I think there are good examples, um, and I've seen examples where, for example, uh, something starts as a meme coin and it becomes like a currency that people actually use to collect, you know, or tip each other, like we've seen with Bonsai on Lensend. Other similar tokens. So I think that's the interesting part, what a meme coin starts and how it evolves down the line.

Yeah, yeah. I think things like Bonk on Solana, Bonsai on Lens, Doge, like some of these have been actually pretty valuable. Cool, guys. This is great. Appreciate the time. I think that's it. Well, I have a feeling this won't be the— Stani's been on here. Too many times, Donnie, on Empire. But Alex, we'll have to have you back on. This is great. I enjoyed it.

I'm going to take a break.

It was a pleasure. Really good questions. Thank you.

That's great.