Solana on Ethereum? Solana has a virtual machine called the SVM. Proponents say it’s much better than the Ethereum EVM…multi-threaded execution…now it’s coming to Ethereum in the form of an L2. 

Today on the show, we brought on CEO & Co-Founder of Eclipse, Neel Somani. Eclipse is not only a new L2 on the scene, it’s also an L2 framework, kind of like the OP Stack. It’s a superchain contender. 

This poses some very interesting questions….who wins? Does this kill Solana? 

------
🎁 Check your wallet with our brand new tool: Claimables 
https://bankless.cc/GetClaimables

------
📣 AAVE V3 is Here!
http://app.aave.com/

------
BANKLESS SPONSOR TOOLS:

🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE
⁠https://k.xyz/bankless-pod-q2 ⁠

🦊METAMASK PORTFOLIO | MANAGE YOUR WEB3 EVERYTHING
⁠https://bankless.cc/MetaMask

⚖️ ARBITRUM | SCALING ETHEREUM
⁠https://bankless.cc/Arbitrum ⁠

🛞MANTLE | MODULAR LAYER 2 NETWORK
https://bankless.cc/Mantle ⁠

🦄UNISWAP | ON-CHAIN MARKETPLACE
⁠https://bankless.cc/uniswap

🗣️TOKU | CRYPTO EMPLOYMENT SOLUTION
https://bankless.cc/Toku

-----
TIMESTAMPS

0:00 Intro
7:10 Motivations For Eclipse
10:50 Why is the SVM Great?
16:00 How Fee Markets Work? 
19:20 Ethereum & Eclipse Pairing
20:25 What Kind of L2 is Eclipse? 
23:25 Celestia For Data Availability? 
25:30 Security Trade-Offs? 
27:30 Transactions on Eclipse
28:00 Economics on Data Availability 
33:50 RISC Zero & Eclipse 
36:10 Modular Thesis 
41:00 Eclipses's Superchain?
44:35 Eclipse Today?
45:20 Winners vs. Losers 
46:40 Eclipse vs. Solana 
49:00 Bad for $SOL? 
52:45 Eclipse Team
53:45 Solana as an L2
55:00 Eclipse Token?
55:45 Future Ecosystems
57:05 Naming This New Tech 
58:50 Roadmap
1:00:30 Neel's Bio
1:01:50 Closing & Disclaimers

-----
RESOURCES

Neel Somani
https://twitter.com/neelsalami

-----
Not financial or tax advice. See our investment disclosures here:
https://www.bankless.com/disclosures⁠

That is the question we explore on today's episode with a new product release as well.

This is an opportunity to pick into a topic we haven't yet touched on on Ethereum, which is a virtual machine that Solana has called the SVM.

So proponents have said for a long time that it's much better than the Ethereum EVM.

It has multi-threaded execution, lots of bells and whistles that Ethereum doesn't have.

And now on today's episode, we're finding out that it is coming to Ethereum in the form of a layer 2.

That is the layer 2 that is launching today with the SVM embedded.

And Eclipse is not only a new layer 2 on the scene, but it's an entire framework, kind of similar to the Optimism Superchain network as well.

So this poses a lot of interesting questions, as you might imagine, that we are going to dig into today, including who wins.

What does this mean for the future of our industry?

I would even say that a lot of Ethereum people will say that yeah, the SVM, the fantastic piece of technology, and it is better than the EVM, especially when it comes to the things that virtual machines do, which is execution.

There are some massive questions that this brings to the table, and I'm about to ask them.

But first, I want to talk about our friends and sponsors over at Layer 0, who have a brand new announcement on the scene.

Google Cloud and Layer 0 are partnering together to help thread together 15 different chains across the Web 3 ecosystem.

It passes messages across from chain to chain.

Well, it is the service provider, the Oracle, that does that message passing.

But if you don't want Google, you are free to also pick your own Oracle.

You could do just like Google, how Google is the default search browser for many browsers.

Google is the default Oracle for Layer 0.

There's a link in the show notes if you want to find out more, layer0.network.

There's some big questions on today's episode.

And so we have the founder of the Eclipse Layer 2.

And he's going to be jumping on the podcast in a minute here.

But David, we're going to be unpacking 4 different protocols.

There are a few others as well that are woven into this layer, too.

What are the big questions to prepare us?

Yeah, the question doesn't stop at, is this Ethereum versus Solana, Ethereum or Solana?

Celestia and risk 0 are also relevant here.

And I think 1 of the questions is like The big question, if we are investors in this space trying to invest in the future, we want to ask the question, who wins?

What are these components doing together?

And does some of these components win more than others?

Or am I just using this lens of winning versus losing because that's my lens for all blockchain system?

So the first question I think we're going to get at is does the Solana VM as an Ethereum layer 2, is that a bigger win for Ether than it is for Sol?

The Solana fanboys in my mentions are convinced that this is the Ethereum protocol moving closer to Solana.

But the Layer 2-centric take is that all good execution tech will eventually settle on Ethereum liquidity and security.

But then, what the hell does Celestia have to do with this equation and what's 0 doing there?

So this is not just a question about like the tug of war between these 2 cooperating competing protocols, but what does this mean for the modular thesis at large?

So some very big questions And I think I listened to Neil Somani over at the modular summit back in ECC and some of his talks around the space.

And I think he's got some of the answers.

So we're going to ask all these questions to Neil here in a second.

But first, a moment to talk about some of these fantastic sponsors that make this show possible, especially Kraken, our preferred exchange for crypto in 2023.

If you do not have an account with Kraken, consider clicking the link in the show notes to hear them, to check them out right now.

Kraken Pro has easily become the best crypto trading platform in the industry.

The place I use to check the charts and the crypto prices, even when I'm not looking to place a trade.

On Kraken Pro, you'll have access to advanced charting tools, real-time market data, and lightning-fast trade execution, all inside their spiffy new modular interface.

Kraken's new customizable modular layout lets you tailor your trading experience to suit your needs.

Pick and choose your favorite modules and place them anywhere you want in your screen.

Whether you are a seasoned pro or just starting out, join thousands of traders who trust Kraken Pro for their crypto trading needs.

Visit pro.kraken.com to get started today.

Mantle, formerly known as BitDAO, is the first DAO-led web 3 ecosystem, all built on top of Mantle's first core product, the Mantle Network, a brand new, high-performance Ethereum layer 2, built using the OP stack, but uses Eigenlayer's data availability solution instead of the expensive Ethereum layer 1.

Not only does this reduce Mantle Network's gas fees by 80%, but it also reduces gas fee volatility, providing a more stable foundation for Mantle's applications.

The Mantle treasury is 1 of the biggest DAO-owned treasuries, which is seeding an ecosystem of projects from all around the Web3 space for Mantle.

Mantle already has sub-communities from around Web3 onboarded, like Game7 for Web3 Gaming and Bybit for TVL and liquidity and on-rails.

So if you want to build on the Mantle network, Mantle is offering a Grants program that provides milestone-based funding to promising projects that help expand, secure, and decentralize Mantle.

If you want to get started working with the first DAO-led Layer 2 ecosystem, check out Mantle at mantle.xyz and follow them on Twitter at 0xMantle.

Arbitrum is accelerating the Web3 landscape with a suite of secure Ethereum scaling solutions.

Hundreds of projects have already deployed on Arbitrum 1, with flourishing DeFi and NFT ecosystems.

Arbitrum Nova is quickly becoming a Web3 gaming hub, and social dApps like Reddit are also calling Arbitrum Home.

And now, Arbitrum Orbit allows you to use Arbitrum's secure scaling technology to build your own Layer 3, giving you access to interoperable, customizable permissions with dedicated throughput.

Whether you are a developer, enterprise, or a user, Arbitrum Orbit lets you take your project to new heights.

All of these technologies leverage the security and decentralization of Ethereum and provide a builder experience that's intuitive, familiar, and fully EVM compatible.

Faster transaction speeds and significantly lower gas fees.

So visit arbitrum.io where you can join the community, dive into the developer docs, bridge your assets, and start building your first app with Arbitrum.

Experience web 3 development the way it was always meant to be.

Bankless Nation, I would love to introduce you to Neil Samani, the founder of Eclipse, a project working to bring the Solana virtual machine, the SVM, to Ethereum.

Today Eclipse has announced their SVM mainnet, the first Eclipse layer 2 on Ethereum that uses the SVM as its execution engine, but Ethereum for settlement and liquidity.

Well, it doesn't stop there because Eclipse is also using Celestia for data availability and Risk 0 for fraud proofs.

So Solana's execution environment, settling on Ethereum, with ETH as its gas, using Celestia for data availability, and then security offered by risk 0 fraud proofs.

My first big question to you, Neil, is what the hell is that?

Who even allowed you to put all these for?

there, this is the, what the hell is this family guy meme for the people listening on the podcast.

It's like Noah on the ark and There's some kind of hybrid animal, like a giraffe, elephant, like, well, I don't know what that tail that is, but some kind of hybrid animal that's been created, like the platypus.

So Neil, where did this idea to put 4 different networks together come about?

And maybe talk about some of the motivations here.

So the original idea was just to put Solana on Ethereum.

And that was the motivation behind the concepts.

And what we ran into was just a ton of constraints and things that you'd expect to be true for a virtual machine, because that's how it is in the Ethereum world.

So an example is like chain ID, when you switch your MetaMask wallet to another Ethereum chain or another EVM chain, then they actually have like a well-defined mechanism for doing that.

Another example is there's no global Merkle tree for Solana.

So the lack of these primitives means that that initial idea was not so easy to implement.

So we basically implement, we have to add in Celestia, RISC-0 out of necessity in order to make this possible.

Wait, so you had to add Celestia and Risk 0?

Like it wasn't an option to just do a layer 2?

I think, so it depends on the amount of transaction volume that we end up running, but at our projected amount of transactions, Ethereum DA would just prove to be very expensive.

And it would also lack a lot of the benefits of the Solana VM, which is that you're going for scale, meaning that you want the transactions to be really cheap.

So right now it's like the base cost for writing 200 bytes to Ethereum is about 15 cents.

So that would be like much more expensive transactions.

And that opens us up to a tongue from the Solana community, which is like, oh, we're much cheaper than you.

By doing it this way, then we can actually be competitive on price too.

Yes, Data availability is very expensive in today's world.

We just did release an episode earlier this week with Dom from ETH Research on Blob Space and EIP-4844, where the cost of data availability for roll-ups is going to drop quite significantly.

Or maybe, let me just rephrase that and say, the availability of data availability is going to be increased massively through the in the form of these blobs.

Does that change the calculus at all for you or is it kind of the same?

It's still more expensive than something like Celestia.

Yeah, given that it's a fee market, we have to see where that fee ends up landing.

So I want it to be live, but yeah, there's great research going on in the Ethereum community for scaling DAA.

We're watching it closely and we have ambitions to eventually just be fully on Ethereum and just use that for DA as well.

Okay, well let's talk about the big thing here.

So the Solana virtual machine, the SVM, we've not done an episode comparing the SVM versus the EVM.

This maybe gives us a little taste of that.

Can you tell us what is so great about the SVM?

Why do some people sing its praises and seem to prefer it for certain things?

The way to think about it is by starting with the EVM and just understanding the failures of the EVM so far in scaling Ethereum.

And I think that if you ask a lot of the researchers in the Ethereum community, scale is pretty much the biggest issue.

But it feels kind of redundant for me to be saying that because everyone's talking about it.

Yet the way that they've tried to bring scale to Ethereum is just by taking the EVM and, and turning it into a rollup effectively.

But what's nice about a rollup is that once you've decoupled execution, consensus, settlement, and DA, is that you can make that executionally or whatever you want.

So the issue with the EVM is that it's single threaded as it exists right now, meaning that all the transactions get in a single file line, they're executed 1 at a time.

And that means that if there's a big NFT drop, for example, then that's going to really spam the network.

And there's no way to get your D5 transaction in unless you're competing with all those other transactions that are in line.

But what's nice about a parallelized virtual machine is that you can execute those transactions concurrently given that they're not touching the same piece of the state.

So that's what the Solana virtual machine primarily brings.

And it's the most battle-tested VM in the sense that Solana's been around, as opposed to Move or some other parallelized virtual machines which are much newer.

And that means that you also get the benefits of the existing Solana codebase, any existing libraries that are written for the SVM, and we can take all those and immediately port it to Eclipse.

So that's the main reason to use SVM, which is just scale.

And scale is inherently maximalist take for a roll-up to claim, because we're basically saying that if you have 1 SVM, you don't need all these other single-threaded VMs around it.

Yeah, so 1 of the reasonings I've heard around the EVM is that while the EVM does execute because that's what virtual machines do, it was not built for execution.

It was built for the Ethereum layer 1 and that has prioritized other properties.

And while the EVM has had a ton of just network effects, the open source network effects around the EVM are super, super strong.

1 of the things we're seeing is that the network effects around the SVM are growing sufficient tailwinds that, Neil, I think what you're saying is that, well, I can feel safe that there is sufficient momentum in the network effects of the SVM code base that is going to be an alive code base moving forward into the future.

And so it is going to be the execution virtual machine that we can deploy to Ethereum because if we have a rollup-centric roadmap, we aren't beholden to the EVM on layer twos.

And what's cool is that it actually goes beyond just the existence of the SVM per se.

It's a bit of a misnomer because the SVM is actually the Berkeley packet filter virtual machine.

And that's been in the Linux kernel for decades.

So this is a very old virtual machine and it has raw support, where us can compile to the bytecode.

And there's a few surrounding extensions that are pretty battle-tested as well.

So we're taking all this existing wealth of open source code and just repurposing it as an Ethereum ML too.

I would argue it's like orders of magnitude, like a hundred times or something, some ridiculous magnitude or faster, yeah.

Okay, So like if we take a roll up with the exact same stack you're talking about, but rather than the SVM, we have the EVM versus what you're doing with the SVM, How much better is yours?

You're saying an order of magnitude, like 10x, 100x?

Yeah, it's always tough to talk about throughput because the reality is it depends on what are the state access patterns.

Let's say every transaction in the SVM was accessing the same piece of state, then you actually can't beat sequential because that's just the fact about databases, right?

You'd have to impose, if it was sequential writes, let's say.

So then you have to lock that piece of state to execute the transaction, then do the next 1, then do the next 1.

So you're not saving anything in the sequential case, but assuming they're all touching different pieces of state, which if the crypto thesis is right, we're going to have all kinds of applications doing all sorts of different things.

And that's effectively what these EVM rollups are mimicking.

If you look at OP stack, the reason why people are deploying these is a lot of time they cite dedicated block space, but that's exactly what the SPM already solves for them.

So our thinking is why fragment liquidity, fragment the user experience, make them switch networks.

It's looking like a mess already, but you can prevent all that by just keeping it all in the same chain.

Okay, so 1 of the, I guess the bull case for the EVM is basically, I don't think anyone really prefers it for its execution prowess and capabilities.

They all prefer it because of the network effect.

It's because we started with the EVM, a whole bunch of apps were built, and now we could just very easily port those apps to Rollup.

And I guess with SVM, it is, you're making the case that it is much better for just kind of the execution layer type thing, and you're still taking advantage of some of the network effect that Solana has built as well.

I want to ask a question here, because I'm not sure I fully understand this, but about like kind of different fee markets and resourcing.

So is it the case inside of your rollup that if there is a big NFT drop or some sort of app that is consuming a large quantity of the block space inside of Eclipse.

Is that somehow isolated or segmented, or is there some kind of bifurcation of resources between another layer?

Yeah, this is a term that I have not fully understood, but I know our friends on the Solana side really purport this as 1 of the main virtue of actually Solana is like these localized fee markets.

And if you've looked at Arbitrum lately, fees still spike substantially on roll-ups if they're single threaded.

And that's because of that exact reason that you're mentioning the global fee market.

If GMX gets a bunch of activity, then everyone suffers as a result.

But economically, that's not actually really the way that it should be because there's this negative externality to GMX being imposed on all of the other apps, but really it should be constrained to that 1 app.

So it's as if you took all these global fees and you just concentrated it on the 1 app that's actually causing on the hotspot or a state hotspot, as some of the folks on the Solana side will describe it as.

And everyone else can just keep merrily happily walking along and they can execute on other cores.

So it's really a property of the scheduler within the validator because in every validator, you have to somehow decide what order am I going to process transactions.

And they're saying everything that's accessing this piece of state is going to all go on a single core and everyone else can use the other cores and there's no contention on those.

So Neil, this is really just a statement.

The design philosophy of Eclipse is just a statement that it's a bullish statement on the growth of the SVM network effects.

So maybe in this day and age, if you were like Optimism or Arbitrum, you're going for this thing called Ethereum equivalence, just then they are making a statement that, hey, we are bullish on the growth of the EVM network effects.

And I mean, network effects of different virtual machines can grow independently.

But the philosophy of Eclipse is saying like, hey, the SVM network effects are going to grow.

We want to take that and couple it into whatever the value is of being a part of the Ethereum ecosystem.

Yeah, I'd even argue that EVM network effects have proven to be not so important.

And I think it made a lot of sense initially a few years ago when you had Polygon and BSC launching.

But if you look at the types of apps that were deployed there, you get like SushiSwap, which is effectively a fork of Uniswap.

And now I recognize they deployed even to like Ethereum.

But those are the types of apps you often get.

And it's rare that those apps are actually net new.

Whereas by bringing the SVM to Ethereum, I think we're actually going to see net new applications in the Ethereum ecosystem.

Just given that there's a lot of apps that just couldn't exist without parallelism.

Central limit order bugs being a great example.

We've seen a lot of decentralized physical infrastructure networks on Solana, so we can bring those to Ethereum as well.

Apps like that, I think, are going to be more interesting to me rather than porting apps that already exist.

Okay, so that was the execution environment of the Eclipse project.

And remember, when we live in the modular world, that there are different modules.

So there's a few others that we're going to go to.

I want to go to the Ethereum module next.

Ethereum is directly enshrined in the Eclipse tech stack.

The Ethereum bridge enforces the correct ordering for Eclipse transactions.

Can you talk about the significance of this?

Like what is Ethereum providing to Eclipse?

Yeah, so what this means concretely is that an Eclipse full node includes an Ethereum full node.

So an Eclipse full node is also watching Ethereum, it's looking at that bridge, and that bridge has significance in how the protocol operates.

Meaning if the bridge gets rolled back, the bridge gets reordered, this all influences the Eclipse full node, and it will also get reordered, or it will also get rolled back.

And there's a second more subtle aspect, which is that we use Ethereum for gas, or we use Ether for gas.

And that's an important fact because that increases the moneyness of ETH.

And we had the option to deploy our own token and use that for gas instead.

But we recognize that everyone in the Ethereum ecosystem already uses ETH and there's a ton of it, and people are looking for things to do with that.

So we wanted to keep that intact and use it for a gas bar chain too.

How similar is it to other layer 2s that we know today versus kind of different?

So 1 categorization, is it an optimistic layer 2, or is it sort of a ZK layer 2?

That might be 1 way to look at it, but there are probably others.

Can you classify it with respect to the existing players that people know about?

What's weird is because the Solana VM settlement is so different from EVM layer 2s, the terminology might have to change a little bit and I have some thoughts on that later, but in general, I would describe this as this is an optimistic rollup that uses some 0 knowledge technology or uses some 0 knowledge proof in the optimistic settlement.

So that's what the rollup is as it exists today.

And Moving forward, there's a route where we can actually become a full zero-knowledge rollup.

An optimistic rollup because there's some sort of fraud-proof window.

You're not using kind of like ZK to do sort of all of that side of things.

Yeah, we don't prove every single transaction.

Okay, so we have, so this is a layer 2, an Eclipse node and contains an Ethereum node, which is the bridge.

Ethereum enforces correct ordering for Eclipse By proxy of all of this, this means that the assets on Ethereum, the liquidity on Ethereum, have a direct and open pipe into the Eclipse ecosystem.

Does this mean that Eclipse gets Ethereum for security, or is that the fraud proofs element of this?

See all Bankless transcripts on Youtube

SVM on Ethereum?! Bullish or Bearish $SOL? with Neel Somani, Founder, Eclipse