Discussion of the strengths and advantages of Ethereum and Solana

Debate Introduction - Introduction to the debate between Ethereum and Solana researchers

Discussion on the need for a shared sequencer and real-time snark proving for synchronous composability and trustless asset transfer between L2s.

Synchronous Composability Vision - Discussion of the vision for synchronous composability and shared sequencing

Discussion on decentralized pre-confirmations, homomorphic encryption, and its impact on latency and price discovery.

Solana's Role in Global Synchronization - Explanation of Solana's role in global data synchronization, low-latency price discovery, and competition with centralized exchanges.

Discussion about the engineering challenges in Solana, including timeliness, data availability, and network routes.

MEV Calculations and Transaction Optimization - Discussion on MEV calculations, transaction optimization, and the impact of block times on value capture.

Discussion on the predictive implications of economic security and its potential impact on the security of Solana and similar networks.

Debunking Economic Security Meme - Debate on the relevance of economic security in proof-of-stake networks and its potential impact on network security.

Discussing the prediction of a smaller chain getting 51% attacked and harvested for toxic MEV through censoring of oracles.

The Ugly Part of Solana - Discussing the ugly aspects of Solana, including its isolationist approach, lack of support for like clients, and inability to build trustless bridges with other blockchains.

Debating the necessity of data availability proofs and the implications of making transactions for every read on the chain.

Comparison of USDT Accumulation - Comparing the accumulation of USDT on Solana and L2s, highlighting the significance of network effects and TVL in determining usage.

Presenting the end game vision for Solana, emphasizing the optimization of the network and the goal of maximizing Moore's law and Niels' law.

Focus on Decentralized Money - Highlighting the focus on decentralized money and its impact on Ethereum's design choices and value architecture.

- The piece is a debate between Ethereum researcher Justin Drake and Solana co-founder Anatoly Yakovenko
- They discuss the good, bad, and ugly of each other's blockchain ecosystems
- The episode was spawned from a request in the Bankless discord
- The conversation covers topics such as economic security and issuance
- The episode is sponsored by Kraken, Celo, and Casa
- Justin Drake highlights the positive aspects of Solana, including high throughput, low fees, and good traction
- He also acknowledges Solana's role in providing healthy competition and accelerating innovation in the space

- Solana brings the idea of synchronicity, high scalability, and good pace and reactivity
- Ethereum has a large distributed network, strong security guarantees, and multiple clients for fault tolerance
- Solana focuses on building for future hardware advancements and has a simple approach to solving complex problems
- Ethereum has moved away from relying on honest majority and has added synchrony with data availability sampling
- Both ecosystems have strengths that are underappreciated and worth elevating

- The speaker believes Ethereum has the most network effects, liquidity, and security, making it pre-ordained to surpass Bitcoin.
- They discuss the struggle for alternative layer 1 chains like Solana to compete with Ethereum's network effects.
- The speaker praises Solana's focus on user-targeting products and its developers' execution, but also highlights the challenges in the backend systems.
- They discuss the technical debt and trade-offs in different blockchain systems, and the potential for decentralized pre-confirmations to improve user experience.
- The conversation shifts to the current problems and challenges in the Ethereum ecosystem, including technical design debt and fragmentation between L1 and L2.
- The speakers discuss the difficulty in resolving these issues and the need for coordination and sacrifice in transitioning from proof of work to proof of stake.

- The piece discusses the engineering challenges of achieving synchronous composability in blockchain technology.
- It highlights the need for shared sequencing and real-time proving to enable synchronous composability.
- The importance of latency and global synchronization in blockchain technology is emphasized, with a focus on Solana's role in competing with centralized exchanges.
- The discussion also touches on the potential use of fully homomorphic encryption to optimize data availability and improve price discovery in global markets.

- The speaker discusses the ideal system with low spreads and fast price discovery.
- They mention the possibility of decentralized pre-confirmations to speed up decryption.
- They talk about the potential for timing games and security issues with short block times.
- The conversation also touches on the impact of latency on block building and validator profits.
- The discussion ends with a mention of Mantle Layer 2 and its benefits for DeFi users and developers.

- The Mantle team offers grants, liquidity support, and venture partners to help bootstrap Mantle applications
- Transporter is a token bridging app designed to provide secure cross-chain transactions
- Toku provides tools for token grants and payroll tax compliance
- The discussion involves MEV calculations, block times, and the impact on network centralization
- The debate centers around the optimization of global shared state and transaction confirmation speed in Ethereum and Solana
- The main point is that the slot to ping ratio is a crucial factor in network optimization and can be adjusted to improve performance.

- The discussion revolves around the timing and boundary effects in Solana's engineering
- The goal is to eliminate forking choice and achieve global agreement on block reception time
- There is concern about hypercentralization and the impact of taxes on staking rewards
- The debate also touches on the misleading marketing claims and the need for client diversity and formal specifications
- The outcome of Solana's design decisions and the potential for centralization remain uncertain.

- Debate between Ethereum researcher Justin Drake and Solana co-founder Anatoly Yakovenko
- Spawned from a request in the Bankless discord
- Covers economic security, issuance, and competition in the blockchain space
- Sponsored by Kraken, Celo, and Casa
- Discussion of strengths and challenges in Ethereum and Solana ecosystems
- Focus on technical debt, synchronization, and global synchronization in blockchain technology
- Mention of Mantle Layer 2 and its benefits for DeFi users and developers
- Concerns about hypercentralization and the impact of taxes on staking rewards
- Debate on misleading marketing claims and the need for client diversity and formal specifications
- Uncertainty about the outcome of Solana's design decisions and potential for centralization.

- The speaker discusses the economic security of networks like Solana and Ethereum
- They argue that economic security does not provide actual security to the network
- They emphasize that the real security comes from the detectability and ease of slashing in case of an attack
- They also argue that economic security is not a reliable measure and that social interventions are expensive
- The speaker believes that other networks provide equivalent security for liveness and censorship resistance
- They also question the significance of economic security in the context of network attacks and social interventions

- The discussion revolves around the concept of economic security in Ethereum and other proof-of-stake networks
- The potential for attacks on Ethereum testnets is discussed, with the suggestion that it could become more lucrative in the future
- The conversation also touches on the importance of economic security and the potential risks for networks like Solana
- The debate highlights the need for strong engineering and economic security in blockchain networks to avoid potential attacks and maintain trust.

- Discussion about the security of Solana and the potential for 51% attacks
- Criticism of Solana's lack of connection to existing network effects and low accumulation of USDT
- Debate about the relevance of TVL as a signal for chain usage
- Discussion of Solana's lack of support for like clients and real-time mercurialization
- Debate about the value of running a node at home and the focus on decentralized money in Ethereum's design choices.

- The discussion revolves around the value and scalability of Ethereum and Solana
- Anatoly argues that Ethereum's design decisions ruin the cool part of the network and that there is no value to be captured in the settlement of execution
- Justin counters by stating that data scales linearly and that they want per transaction fees to be low but in aggregate, it could be hundreds of millions of dollars
- They debate the concept of induced demand and the limitation of bandwidth
- Anatoly believes that Solana has accomplished something impressive with sustainable revenues and low access fees for users
- The vision for Solana is to maximize Moore's law and Niels' law and optimize the network for better outcomes for users
- There is uncertainty about whether decentralized money will work and how Ethereum fits into the end state vision of Solana

- The discussion revolves around the importance of network effects, TVL, and building digital assets on different environments
- There is a debate between the importance of technology and network effects in the success of blockchain platforms like Ethereum and Solana
- The end game is seen as winner-take-most, with strong network effects driving the success of a platform
- Ethereum is seen as the most likely candidate to win, but there is still potential for other platforms like Solana to succeed
- The conversation ends without any change in opinions, and the possibility of a follow-up discussion in the future

The discussion revolves around the concept of economic security in Ethereum and other proof-of-stake networks, with a focus on potential network attacks and social interventions. There is also a debate about the relevance of TVL as a signal for chain usage and the importance of technology and network effects in the success of blockchain platforms like Ethereum and Solana. The conversation ends without any change in opinions, and the possibility of a follow-up discussion in the future is mentioned.

✨ Mint the episode on Zora ✨
https://zora.co/collect/zora:0x0c294913a7596b427add7dcbd6d7bbfc7338d53f/9?referrer=0x077Fe9e96Aa9b20Bd36F1C6290f54F8717C5674E

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🎬 DEBRIEF | Ryan & David unpacking the episode:
https://www.bankless.com/debrief-the-justin-drake-vs-anatoly-yakovenko-interview

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Ethereum vs. Solana. That’s the debate we’re having today.

On Ethereum’s side we have Ethereum Researcher Justin Drake, and on the Solana’s we have Solana’s Co-Founder Anatoly Yakovenko.

They give us the good, the bad and the ugly of each other’s blockchain, settling their endgame towards the end of the episode. 

This was one, if not the spiciest debate we had on the show. We tried our best to give both guests time with minimal intervention. At times went well, at others it caused deep semantic rabbit holes. But overall both guests were able to communicate their messages.

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TIMESTAMPS

0:00 Intro
7:16 The Good
22:30 The Bad
52:03 Global Shared State
1:06:07 Economic Security
1:30:08 The Ugly
1:47:23 The Endgame
1:55:22 Closing & Disclaimers

------
RESOURCES

Anatoly Yakovenko
https://twitter.com/aeyakovenko 

Justin Drake
https://twitter.com/drakefjustin 

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

There is a reason why Ethereum data availability is worth more than Solana's data availability.

Yes, this notion of shared security, this notion of synchronous composability.

Not just that, but also access to TVL, access to applications.

There's only 1 Ethereum and Internet main system.

This is why I think it's ugly and it's not fixable, is it's not a fundamentally hard thing.

Welcome to Bankless, where today we're exploring the frontier of Ethereum versus Solana in debate style format.

I'm here with David Hoffman and we're here to help you become more bankless.

So on the debate track today, Ethereum versus Solana.

We've got a conversation between Ethereum researcher Justin Drake and co-founder of Solana and Natalia Yakovenko.

Now, both of these were previous Spankless guests.

I'm sure you know them from their respective communities.

The prompt for this episode was really simple.

Give us the good, the bad, and the ugly of each other's respective blockchain ecosystems.

You can talk about architecture, you can talk about economic security, and indeed the guests did.

David and I tried to give both guests time to debate each other with minimal intervention, and I think at times this went well.

At other times, it probably caused us to go down into semantic rabbit holes fairly deeply.

But overall, I think both guests were able to communicate their main messages throughout this episode.

Sometimes they were attacking, sometimes they were defending.

Occasionally, they were throwing each other compliments.

It's a very entertaining episode overall.

If you pay attention to Anatoly and Drake on Twitter, you'll know of a couple of topics that are coming your way.

Some big dividing lines finally get sussed out in long form on this episode.

It was actually kind of spawned out of just a simple ping from a member of the bankless discord asking if it would Be possible to get Justin and and it's holding on a podcast together to have a debate and I was like, I also want this and since it didn't really hurt to ask upon asking both Justin and Anish Floyd said yeah sure And so after a bit of scheduling, here we are.

I think the 1 thing I'll say about this episode and generally like crypto at large, when people enter crypto, they generally find a tribe pretty quickly.

Like you come into crypto, you learn about it.

And then you learn about a layer 1 that you like identify with more than others because it aligns with your vibe.

The how and why people become members of the tribe is personally, I think, 1 of the more interesting things to explore in crypto.

And you can really see it come out in this debate.

You can really see some of the dividing lines between just who Justin is and what Ethereum is and who Anatoli is and what Solana is.

So that's kind of like the frame of mind that I encourage listeners to go into this episode with as they hear Justin and Anatoli parse out some of these things, finally in a long form conversation.

So let's go ahead and get to that long form conversation.

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Bankless Nation, we are extremely excited to tee up this conversation with 2 esteemed guests.

And in the other corner, I don't know if I should do fighting meme for this, but Justin Drake, he is a researcher at the Ethereum Foundation.

is going to be a conversation between some of the design decisions and differences between Solana and Ethereum.

I think this is a conversation that the entire crypto community will tune in for it.

I think the way we're going to organize this is in a few seconds sections.

First we're going to talk about the good.

Then we're going to talk about maybe the bad, the things that are correctable over time.

And then we're going to talk about the ugly.

And of course, we can veer from 1 section to the other as as you guys see fit.

But let's start the conversation with something hopeful, something optimistic.

I want to start the question with you, Justin.

What is good about Solana from your perspective?

So if I were to have a metaphor in mind, I'm thinking of the good as a bucket with balls in it.

And actually think of the good bucket as being the 1 with the most balls.

And Solana has lots of obvious good balls in its, in its bucket.

It has a very high throughput, very low fees, very good UX, low latency.

It has good adoption, good financial performance.

We've seen Solana race to basically position number 3.

So if you go to CoinGecko and sort by a fully diluted valuation, Solana is the number 3 layer 1.

And I'm tempted to change the quote by Michael Saylor and say that there is no fourth best.

If you look at, if you look at a fully diluted valuation, there's like, there's a Ripple, there's BNB, there's Taunt, but like, they don't really compete in my opinion with Solana.

So it really is those 3 players in the layer 1 space.

And I think what Solana is doing for Ethereum is that it's providing healthy competition.

And not only accelerationism partly because of good execution, but also because of contrarianism.

Like the way that I think of Anatoly as this constantly contrarian person, like his brain is wired in a very unusual way.

And I say this in the best of ways possible.

And I think you guys, you know, bring forward like interesting insights and you have good vision.

So for example, I think that you want to build this idea of a global state machine.

Global means that a single L1 can support the whole world.

Like in my mind, we're going to see L1s that can support 10 million transactions per second, which is enough for the whole world.

It's 100 transactions per second per human per day.

And then the other big idea that Solana brings to the table is this idea of synchronicity, that not only is there like high scalability, but also different parts of the state can call each other synchronously, at least if you're willing to pay for it.

I also think that Solana has like very good pace and reactivity.

There's been all sorts of issues in the past, that we're going to talk about in the bad section, but broadly speaking, it just keeps on chugging along and moving along.

And in terms of the insights, I think like there are real insights that, you know, Anatoly, you bring to the table, for example, the fact that we live in this exponential world with Nielsen's law, right?

The fundamental bottleneck for scaling blockchains is bandwidth.

And we are in this very luxurious position where bandwidth keeps on scaling exponentially.

So overall, this is a massive bucket of good for Solano.

And Antoine, your turn to talk about Ethereum.

I think what I envy out of Ethereum is it has a, the main net has a very large distributed network across a very large number of physical end nodes and very large number of actual internet links.

So when you look at it as a whole and you think of like what are these networks supposed to do, the mission that Ethereum has it's supposed to provide security guarantees that are stronger than an honest majority.

If you end up with accepting honest majority guarantees, which is fine for a lot of use cases, it's a multi-sig at the end of the day.

I think you just can't really scale it to support the world in a trustless way.

You can't have banks and 401Ks and human finance trust some honest majority that could blow up at any moment.

And I think Ethereum has been so hyper-focused on this that like when they started working on sharding, they pivoted away from that because there's no way to do it, which is awesome.

Like it's actually like the coolest thing to see somebody be like, you know what, this is not going to work because of the security properties we care so much about.

We're going to work on this other roadmap first, because that 1 doesn't compromise something really, really important.

And The execution for people like think Ethereum is moving slow, but if you look at the size of the network, its value, I would be terrified of any changes to Solana if it was at that value.

It's just terrifying, right, for something to go wrong.

Outages at that point are much more catastrophic, I think.

So Ethereum actually moves pretty fast for project at size.

I think this is, again, the biggest thing that you're supposed to provide is this better than honest majority security guarantees.

And when you have 4 clients, you're not trusting a single piece of software.

Even with the best of human intentions, it's still written by humans, right?

The original BFT paper actually talks about you need to write, you need to have separate teams building stuff in isolation so you can actually have this fault tolerance across the human bus factor.

So, there's a lot of envy there and I think that's awesome.

Like, from my perspective, Ethereum is at a point where to cause a double spend attack, you need NATO to coordinate across the thousands of different ISPs and to have everyone execute like a thing all at once.

I don't think you can do better than that in the real world.

So it's at a point which I think every other L1 should be envious of and trying to get there as fast as they can, right, as fast as they reasonably can.

All of that I think is, puts it in a class, I think in my mind actually above Bitcoin So for what for what that's worth

we're starting this off on a very nice foot then but both You've said nice things about the the others primary ecosystem Anatoly just curious your reflections on what Justin said about Solana.

Like, yeah, what was going through your mind as Justin was saying these things?

I mean, like, I think I find those to be positives of what Solana has accomplished.

I think probably because of my experience working at Qualcomm for like a decade, I saw how fast Nielsen's law moves and how fast Moore's law moves when it's targeting an industry that's in hyper growth.

And you just kind of, your brain as an engineer shifts.

You're not writing for code for hardware today or yesterday even.

You're writing for hardware that's going to be out in 2 to 4 years.

So you're expecting just everything to get faster.

So this is something that I think has been something that I've been like kind of hitting the table with to all the engineers that are working on Solana is you got to build things to scale as if the hardware is twice as fast.

Just assume it's going to be twice as fast, how you're writing the code, how you're designing the SIMDs and kind of leverage that.

And I think that focus has paid off, honestly.

Like that was a big bet that a small team, like a very small team that had way less funding than all our competitors took from 2018 to 2020 to launch.

And we launched faster because we're like, don't make this complicated, just throw a thread pool there.

It takes engineering, but it's much easier to think of problems like, okay, like even look at proof of history.

It's not, I remember talking to Justin like a week after we like became an official company About VDFs and our solution was this very very extremely dumb approach Just verify the VDF with as many cores as you have available to you and don't worry about These this fancy math that I don't understand if it's secure or not and that works So like stuff like this I think is underappreciated.

And I'm glad that, you know, Justin has recognized that in some ways.

So Justin Anatoly has said some nice things about Ethereum and said it would take NATO to disrupt the network and cause a double spend.

And like maybe they couldn't even do it said it's, you know, like more, I forget the phraseology, Anatoly, but like on a higher pedestal than Bitcoin.

Let's just say, So what was going through your head as Anatoly was extolling the virtues and the values of Ethereum there.

Yeah, so 1 thing that Anatoly said, which I agree with, is that it's kind of bad design nowadays to try and rely on honest majority.

And it is true that our previous sharding design did rely on honest majority.

But this is something that we have moved away from just through technological innovation.

So now there's this idea of data availability sampling, where you don't have an honest majority, you have an honest minority.

And we have this new flavor of sharding, which is dank sharding.

And not only have we removed the honest majority assumption, but we've also added synchrony.

So it used to be that we had a 1,024 or 64 asynchronous shards that would each have its own independent proposer.

And instead now we have kind of this 1 big proposer that basically publishes a big block that everyone is capable of verifying is indeed available using very, very little bandwidth.

And this technique is called data ability sampling.

And I think Anatoly had a podcast called No Sharding, and eventually decided to change the name.

I think this is good because the fundamentals are really in favor of sharding, or at least dank sharding.

In terms of other things that he said is 1 is that it's very, very difficult for to double spend Ethereum.

Now, while I agree with that statement, I think this is kind of the wrong lens.

And the reason is that there is a much easier attack than double spend, which is basically around censorship and liveness.

So, and I totally focus is a lot in my opinion on safety.

And to a very large extent, I agree that safety is not an issue.

1 because the validity of blocks can be checked by full nodes.

So if you try and just create an invalid chain, it will just get rejected.

And for specifically reorgs and double spends, there's this notion of slashing.

It's just so expensive to do the attack that it's basically impossible.

But there is like these, these more subtle attacks around liveness and central resistance, which I think are the ones that are most important.

And I think are ones that Anatoly is under indexing upon.

And then another thing that Anatoly said is SIMD and maybe the listener might not know what that means.

It's the equivalent of an EIP for Solana.

As we kind of wrap up this good section, I want to give also a chance for each of you guys to maybe elevate something that is unsung about your own ecosystem.

So Anatoly talked about what's good about Ethereum, Justin talked about what's good about Solana.

All of a sudden this is really feeling like therapy, but we'll ignore that.

There's something wrong with therapy, David.

We did not mean for this to feel like a therapy session, but nonetheless, here we are.

But maybe Justin, maybe you can advocate for Ethereum.

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ETHEREUM VS. SOLANA: Which Blockchain Wins 2024 & Beyond?