Weekly Rollup #47
Stride's Liquid Staking Protocol for Celestia | 2023 Roundups | Is Ethereum more permissionless than Solana? | Week ending Dec. 31st
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This week’s issue covers:
Stride's Liquid Staking Protocol for Celestia
2023 Roundups
More News & Announcements
Is Ethereum more permissionless than Solana?
More Education & Discourse
📣 News & Announcements
Stride's Liquid Staking Protocol for Celestia
This past week, Stride co-founder, @aidan0x, shared a post on the Celestia community forum as to how Stride is thinking about building a liquid staking protocol for Celestia, making sure it’s both safe and aligned “with Celestia’s own governance and carrying minimal trust assumptions”.
The TLDR:
Challenges with existing options: Trust concerns and misalignment with Celestia’s governance.
Stride's Solution: Building a trust-minimized LSP, emphasizing safety & alignment with Celestia's governance.
Short-term proposal: Advocating for the activation of Interchain Accounts (ICAs) for more trust-minimized LSPs.
Long-term vision: Exploring SNARK accounts & zk-IBC for ultimate trust minimization.
But wait, why even liquid staking?
Back in September, Viroot, who used to be part of the Stride team, first teased the idea of bringing TIA liquid staking with Stride.
He mentions two general benefits:
Capital efficient integrations: easier for apps to integrate stTIA than TIA
Raises chain’s economic security: option of using stTIA in defi incentivizes staking, thereby increasing economic security of the network
However, he also mentions a couple of benefits, specific to Celestia:
Chains can pay for gas & DA with stTIA
stTIA can support decentralized sequencers
Rollups could leverage stTIA in treasury management
Okay, now here’s a more complete breakdown of the most recent post👇
LSP criteria
The post starts by mentioning that in navigating design choices for LSPs on Celestia, the emphasis is on creating an out-of-protocol, trust-minimized framework. Specifically, he lists three criteria the LSP should meet:
“reduce trust assumptions as much as possible”
ensure the Celestia community has governance control over the LSP
“use battle-tested, observable, audited protocols”
Out-of-protocol solution
We just mentioned Stride exploring an “out of protocol” solution. This is because Celestia is a “lazy” blockchain (hence their previous name, “Lazy Ledger”) - all it does is worry about data publication & consensus (no smart contracts).
Viroot also wrote more in detail about why the appchain approach is better than same-chain liquid staking. The advantages he mentioned includes:
Keeping Celestia minimalist (keep it for DP)
the appchain could highly optimize for security
Reduced maintenance cost: “guarantees regular and timely updates”
The Solution Space
The post proceeds to talk about the current solution space, including current options, short, and long-term options:
Current Options:
He starts by mentioning the two options that “are the least healthy for the network”, multisig LSTs & CEX-issued LSTs, along with the tradeoffs these two options make
specifically, this is in regards to Milky Way, which offered the first opportunity for $TIA holders to stake their tokens (in return for milkTIA)
Short-term - Interchain Accounts (ICAs):
As a reminder, here is what ICAs are, as defined on the Cosmos developer portal.
Aidan mentions that leveraging ICAs offers “the best path to more trust-minimized, battle-tested LSPs in the short-to-medium term”.
Considering Stride leverages interchain security, the Stride “validator set has significant overlap with the Celestia validator set”.
Long-term - SNARK accounts & zk-IBC
“Long-term, there exist (at least) two trust-minimized approaches with promise”:
“LSP built as a Celestia zk-rollup that leverages SNARK accounts”
“LSP built as a Celestia sovereign rollup using a zk-IBC client on Celestia and ICA”.
Celestia should have governance control over the LSP
Stride believes the Celestia community should have the final say on “important matters” within the LSP, such as how validators are selected. He goes on to list three approaches for validator selection, along with the pros & cons for each.
“Stride inherits the Celestia validator set distribution and rebalances frequently“
a certain group of Celestia community members (stTIA holders for example) elect a council, which then elects the validators
“Stride governance elects Celestia validators through its normal process, but veto powers are given to stTIA holders”
Apps with Celestia Underneath
Four teams have already been mentioned “to have clear paths to stTIA usability”:
Hyperlane
Dymension
Modular Money
Excited to see this proposal by the Stride team, and looking forward for what’s to come, which btw, will be “a CIP to activate ICA on Celestia on an accelerated timeline“.
Make sure to check out the full post for full details.
2023 Roundups
2023 was a huge year for the modular ecosystem. Here are just a couple of the roundups we were able to gather (& our apologies if we missed a couple):
Avail
AltLayer
Hyperlane
Vistara
Fuel
Scroll
Taiko
We can’t wait to see what’s in store for this new year, all across the entire modular ecosystem! 🧱
More News & Announcements
Looks like there are two new teams building their own Arbitrum rollup using Conduit’s RaaS solution: (1) Parallel Network, “the first omni-chain L2 blockchain powered by Arbitrum that unifies liquidity from any chain into one place”, and (2) Inspace Network, which looks like is following a similar approach (”100% fair launch”) as ZKFair, which we talked about here.
Ian Sagstetter from Espresso shares an idea for ZCash to become its own sovereign rollup using an external data solution such as Celestia.
Intmax is considering using EigenLayer for its own Eth L2. We wrote a small deep dive aout Intmax here.
Here’s a roundup of recently added EigenLayer AVSs: AltLayer, Hyperlane, Near, Witness Chain, Ethos, Lagrange, Mangata, & Omni - several of which we’ve talked about when first announced 👀
New Caldera chain is up - a good time to mention nothing here is an endorsement, simply unbiased news coverage.
Sounds like there will be several teams across other L2s (including BTC L2, DePIN, & more) who will be deploying their own rollup soon, following Lumoz’s recent announcement of “Fair-L2”. In other words, more L2 launches similar to ZKFair.
Some interesting stuff happening on Arbitrum’s governance forum: (1) support to establish GrantsDAOs, (2) Establish the ArbitrumDAO Procurement Committee, & (3) Arbitrum Stable Treasury Endowment Program (STEP). Click on the link for more details.
Here’s a good round up of some of what Movement Labs has been building, along with some of the partners they’ll be working with this year, including Avalanche, Shogun (defi & cross-chain liquidity), Zokyo (cybersecurity firm), and more.
Vitalik shares a new updated roadmap for 2024. Vitalik goes over the few changes in the thread.
RedStone Oracles now provides TIA price feeds.
📚 Discourse & Education
Is Ethereum more permissionless than Solana?
Sreeram from EigenLayer highlights the different engineering cultures of Ethereum and Solana. Everyone in the space recognizes that these two ecosystems have different engineering cultures, but what’s interesting is how they differ. As Sreeram frames it: permissionless innovation vs. team building.
But aren’t all blockchain teams building permissionless systems? Isn’t this the point? Yes, but Sreeram is referring to a more nuanced difference in HOW the systems are engineered. He is specifically referring to which components (of the permissionless system) are themselves permissionless to innovate on.
Blockchain “layers” are framed in many different ways, but for this exercise let’s consider the following. It’s oversimplified, but useful.
App layer: Smart contracts
Execution layer: Where smart contracts are executed
Base layer: Consensus, DA and other middleware functions
Now let’s map these layers onto Ethereum-based systems vs. Solana-based systems.
Ethereum-based systems
App layer: Permissionless
Execution layer: Permissioness via L2s
Base layer: Permissionless via EigenLayer
Solana-based systems
App layer: Permissionless
Execution layer: Permissioned
Base layer: Permissioned
Through this lens, it becomes clear that Ethereum-based systems offer a greater degree of permissionlessness, further down the stack. Anyone in the world can spin up a new execution layer and compete. And once EigenLayer matures into its permissionless vision, anyone in the world will be able to spin up new base layer services (e.g. fast settlement, sequencers) and compete. In Solana-based systems, the only way to innovate on the execution and base layer is to join Solana core.
Is this unique to Ethereum? Can Solana do the same? Yes and no.
Let’s look at this through both technical and cultural lenses.
Technical: As Mert points out, L2s and other protocols can technically be built on Solana, and users can switch Solana execution for Solana L2 execution. However, base layers compete on different dimensions than execution layers. If Solana were to embrace this, they’d likely need to change their techical roadmap to prioritize client diversity, verifiability, and progressive ossification. In many ways this is directly at odds with their current technical roadmap.
Cultural: The Solana community is aligned around one big, shared, fast state machine and not needing to “fracture” liquidity and composability. Changing the technical roadmap, as described above, would require a cultural 180 and would be a much bigger challenge.
So back to the question - can Solana do the same? Yes and no :)
More Education & Discourse
✍️ @VitalikButerin suggests bringing cypherpunk values back into the Ethereum community
🎙️ Bankless discusses what’s in store for EigenLayer in 2024 with Sreeram and Teddy from EigenLayer
✍️ Blockworks Research deep dives into their year end protocol review 🔥
✍️ @VitalikButerin proposes PoS simplifications for making Ethereum consensus lighter and simpler
🎥 @avihu28 discusses all things rollup escape hatches 🔥
🎙️ Bell Curve discusses fee markets and resource pricing
🎙️ Epicenter discusses staking decentralization and DeFi LSTs with Lido DAO
✍️ Kinto explains how account abstraction is a catalyst for mass adoption
💬 @GarrettHarper_ dives into the 5 things you need to know about Celestia 💎
✍️ @norswap breaks down his experiences designing and running the OP Stack
✍️ @fradamt explores a path to gradually scale Ethereum DA post EIP-4844, leading up to danksharding 🧠
💬 @ryanberckmans illustrates a future for Ethereum as the global settlement layer, imagining what 2030 activity might look like on L1 and L2s 💎
💬 @nickwh8te explains nuances between Celestia and EigenDA security models
💬 @zerokn0wledge_ explains how EigenLayer and AltLayer collaborate to offer Restaked Rollups
💬 @norswap explains Flashbots SUAVE in simple terms
💬 @EdFelton explains why layering is a cornerstone of good protocol design, using the internet as an example
✍️ @mikeneuder and @drakefjustin explore Execution Tickets, a reimagined blockspace market
🎙️ Polygon discusses community-driven ZK rollups
@franalgaba_ walks through the workflow of ZKML projects, covering how to limit risks and build a good solution
💬 @doganeth_en explains his team’s EIP-7212 proposal and how it will become the first Rollup Improvement Proposal (RIP)
🎙️ Deal Flow discusses the rise of Move-based modular networks with Rushi from Movement
🎙️ RedStone Oracles discusses restaking with eth.fi
💬 @stacy_muur highlights the key RaaS players to watch in 2024
That's all for this week! Thanks for reading 🧱🎬