The blockchain industry remains mired in the crypto winter quagmire, with pioneering currency Bitcoin (BTC) dropping 11% in price last month. But technologists are racing to shape the future with no sign of stopping. Last week, Rune Christensen of decentralized finance pioneer MakerDAO suggested he was prepared to abandon the Ethereum blockchain ecosystem in favor of rival technologies from Solana and Cosmos as the project seeks its own dedicated blockchain. Separately, Ethereum is considering developing its own “supreme courtArbitrate disputes.”
This week's feature focuses on blockchain “sequencers,” a key element of the burgeoning infrastructure for “Layer 2” networks on Ethereum. Sequencers have received a lot of attention recently, in part because they are sometimes treated as a single point of failure that could undermine the design principles of decentralization. Sam Kessler I will explain.
You are reading protocolCoinDesk's weekly newsletter, explores the technology behind cryptocurrencies, block by block. Subscribe here To get it every week.
Solana's Temptation: MakerDAO, one of the oldest and largest decentralized finance (DeFi) protocols on the Ethereum blockchain, is considering migrating to its own proprietary blockchain — and rather than simply launching a new Layer-2 network within the dominant Ethereum ecosystem, as crypto-friendly companies like Coinbase and ConsenSys have opted to do, MakerDAO may be considering exiting altogether. Rune ChristensenMakerDAO founder David Lambert said last week that the project's best bet is Solana As the blockchain has “the most promising codebase,” Christensen cited Solana as having demonstrated “technical quality” and “resilience in having lived through the FTX collapse.” (Solana was famously promoted by Sam Bankman Freed, the now-incarcerated founder of the failed crypto exchange.) universe Co-founder of Ethereum sees blockchain technology as “another major contender.” Vitalik Buterin Apparently not too pleased, he questioned whether MakerDAO was self-destructing in a weird way in a post on a rival stablecoin project's Discord channel, and reportedly sold about 500 of the project's MKR tokens (worth $579,000) that he had held since 2020. (In a separate, potentially salt-in-the-wound moment, credit card network MakerDAO also reportedly sold 10,000 MKR tokens to MakerDAO, a cryptocurrency that has been trading at 10,000 MKR since 2013.) visa The company announced on Tuesday that it has expanded stablecoin payment capabilities to Solana, in addition to Ethereum. Solana Lab Co-Founder Raj Gokal He told CoinDesk TV that the network is “battle tested” and “ready for primetime.”
Code vs. humans: There's an oft-repeated mantra in blockchain thought: “code is law,” the idea that the network's underlying programming should be held sacred and give it the ultimate authority to resolve disputes, even in the event of a serious emergency or existential threat. Now, top officials in the Ethereum blockchain ecosystem have explicitly embraced the idea that in certain extreme scenarios, humans, rather than hard-coded ones, could be better arbiters of justice. Alex Grkowski, CEO of Matter LabsEthereum's top Layer 2 network developer said:Ethereum Supreme CourtThe Ethereum Blockchain Advocacy Group will arbitrate disputes that escalate enough to threaten the integrity of the main blockchain. The system, which Grkowski described on X (formerly Twitter) as a “hierarchical system of on-chain courts similar to the real-world judicial system,” allows apps built on Ethereum to petition to “fork” the chain if they are hacked or face other security crises. “Code is law and bugs mean death,” Grkowski wrote in a blog post. Follow-up comments To the post from September 2nd.
BASE's new fanbase: Just as Friend.tech went from trendy to unpopular after its launch, Coinbase new base A new one has arrived on the scene in Layer 2 blockchains (as documented in The Protocol last week). Airport FinanceTouted as the “premier liquidity engine and hub” for the Base ecosystem, the platform has quickly amassed over $170 million in TVL (total value locked), helping to drive the overall TVL of protocols on Base to over $400 million. The secret? According to the newsletter: Woo BlockchainThe project's “native token” $Aero“We are offering liquidity mining rewards approaching 1,000% annual interest without compounding,” which is a significant amount even in crypto. Aerodrome’s TVL has now exceeded $158 million, which is “flipped” in crypto jargon. Velodromethe predecessor project to Aerodome, which is on an older Layer 2 chain OptimismIs that sustainable? “Money doesn't appear out of thin air,” Wu Blockchain noted dryly, “and it's worth wondering when this spiral will end.” (Base's downside: On Tuesday, the network suffered a “major outage” that lasted just over three hours, its biggest snag since launching last month.)
MetamaskPopular crypto wallets, Announcing new “Sales” feature According to X's post, the feature will “allow users to easily convert their crypto assets to fiat currencies,” and is available in the US, UK, and parts of Europe, and “will initially support ETH.” Ethereum The company says it plans to expand its native gas token on the mainnet to its Layer 2 network soon. Funds can be sent via bank transfer or PayPal balance.
Focus on upgrading and developing blockchain technology.
Regulation, Policy and Law
At least four Ethereum liquidity staking providers have agreed to a self-imposed limit of not owning more than 22% of the Ethereum staking market, Cointelegraph reported, citing X-Accounts. Super PhysAbsent from the list is Lido Finance, the largest, holding 32% of the total staked ETH.
