Degen Chain and L3s: What's Next | The Delphi Podcast

Degen Chain and L3s: What's Next | The Delphi Podcast

April 7, 2024

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SUMMARY

L3s and Degen Chain provide a new sandbox for developers to experiment with unique applications and customization in the blockchain space, potentially leading to a game-changing "iPhone moment" for crypto.

• 00:00 🔗 Degen Chain and L3s offer unlimited customizations with near zero gas fees, empowering communities to design their economic model and expected to be a big thing in the crypto community.

  • The founder of Degen Will and co-founders of Syndicate discuss their partnership with Delphi and disclose their investments and affiliations.

  • Degen Chain and L3s are discussed, with a focus on the excitement and importance of L3s in the crypto community.

  • Degen Chain and L3s offer unlimited customizations with near zero gas fees, allowing for limitless creativity and low-cost high volume experimentation in terms of chain customization and usage.

  • Communities like Degen and others have more agency and empowerment to design their economic model on L3s, which is why L3s are expected to be a big thing, with Degen launching in January 2024 with tipping functionality on Forecaster.

  • The idea for Degen Chain came from interactions with the Farcaster channel and it quickly evolved into a wild ride with verality and distribution built in on the base layer.

• 04:44 🎙 The speaker built tokens, implemented points and ranking systems, and discussed the influence of innovative ideas in the crypto space.

  • The speaker started building tokens after quitting their job and received a lot of support, leading them to work day and night for two weeks to create and distribute their own token.

  • Points and ranking systems were implemented on Degen Chain and L3s, with the token contract deployed on January 6 and the airdrop going live on January 7, followed by a second airdrop in the second phase.

  • The speaker was surprised by the positive reaction to the simple tipping idea, realizing that small impactful moves can have a big impact.

  • Dogecoin had potential for widespread use as a tipping mechanism on social media platforms, but it never materialized due to various issues and scams.

  • Tipping in the crypto scene has been ingrained as a distribution mechanism, with the speaker initially not intentionally thinking about it but later realizing its value and ease of use.

  • The speaker discusses the influence of innovative ideas in the space of points incentives and the emergence of the L2 and L3 narratives in the current cycle.

• 11:48 🔗 Degen Chain has utility within the forecaster ecosystem and potential for growth, with the launch of L3 and more apps expected to integrate it.

  • Degen Chain has utility within the forecaster ecosystem and is a great beta for forecaster, with potential for growth and cool distribution built in.

  • More apps are expected to integrate Degen Chain, and the launch of L3 was announced and launched, with the Syndicate team playing a huge role in its development.

  • Syndicate was the right entity to do this because they had the expertise and were excited to build on DJ.

  • Two developers approached the speaker with a dgen frame for a Powerball lottery onchain, with a UI for their randomness technology, and they were pushing for the speaker to move towards this whole layer.

  • The speaker discusses the idea of moving offchain and the potential of having their own chain and ecosystem.

• 16:22 🔗 Degen Chain and L3s are like the Las Vegas of blockchains, offering a fun experience with potential for community and token support, significant post-Ethereum activity, and exciting new launches.

  • Degen Chain and L3s are like the Las Vegas of blockchains, where you take money for a fun experience and if you don't come back with the money, it's fine because you got your money's worth.

  • The speaker discusses the potential for a new chain that is EVM compatible and the opportunity to build fun apps in the space.

  • Big tech companies have big visions, but Degen Chain is a place to find community and token support, with the potential for other tokens in the future.

  • Degen Chain and L3s have played a significant role in the post-Ethereum Denver meta, with 13 million transactions and $16 million bridged in less than a week.

  • Kobe recently launched a platform for group investing, and the team pivoted to Degen Chain, which had a delayed launch but was a significant public release.

  • The first arbitrum orbit L3 with a custom gas token was launched with supporting infrastructure, and the team is excited to work with Thek.

• 21:55 🔗 L3s are the best infrastructure for onchain communities, enabling low gas fees and high customizability, with a focus on interoperability of data.

  • Syndicate's original mission was to enable onchain communities through dows as infrastructure, with a focus on co-investing, and while the market may have been early, the opportunity is still big.

  • The speaker discusses the need for L3s as the best infrastructure for onchain communities to empower and enable them to achieve their best versions.

  • L3s are beneficial for applications that require low gas fees and high customizability, especially for NFTs, gaming, social, and experimental apps, and as customization frameworks develop, the primary reason for using L3s will shift from gas fees to customizability.

  • Customization of blockchain through the use of npm-like package manager for layer three could be a powerful tool for startups to innovate and deploy features.

  • Layer 3s are for customized functionality and scaling, with different visions for interoperability and composability in the space.

  • Composability needs in blockchain are mostly data, not assets, and the focus should be on interoperability of data rather than assets.

• 33:26 🔗 L3s could revolutionize web 3 with near zero gas fees, richer onchain applications, and potential for easier sequencer decentralization.

  • The speaker discusses the potential shift towards L3s and the impact of low gas fees on the development of L2s.

  • Near zero gas fees on Degen Chain transactions make it unsustainable for mainstream consumer applications in terms of cost.

  • Developers can now put more data on chain, leading to the potential for richer onchain applications and new experiences in the web 3 space.

  • The speaker compares L3 to the iPhone, stating that it will enable the development of new and rich applications in the future.

  • Validators may not be needed in the future as sequencers can be decentralized, allowing anyone to write directly to the chain as long as their transactions are valid.

  • Layer 3 chains have the potential to decentralize and create a collaborative ecosystem, with the possibility of easier sequencer decentralization compared to Layer 2 chains.

• 39:46 🔗 Bridging transactions between Layer Two and Layer One is key for data availability and settlement, with a focus on usage over value capture and the potential impact of Degen Chain and L3s on Ethereum's security and user base.

  • Data availability and settlement are key in bridging transactions between Layer Two and Layer One, with the move to cheaper data availability opening up new possibilities and the importance of bridging to where the token is located.

  • The value of Ethereum lies in its adoption and usage, and focusing on capturing value from small transactions overlooks the potential for millions or billions of users to be onboarded with minimal gas fees.

  • The speaker emphasizes the importance of usage over value capture and discusses the potential impact of Degen Chain and L3s on Ethereum's security and user base.

  • L3s are more decentralized and secure than L2s due to base sequencing, with the biggest censorship risk being the centralized sequencer.

  • The speaker discusses the potential for faster development of the L Series and the relationship between The Syndicate and Deen in the context of their work on Degen Chain and other L3s.

  • The speaker discusses the long-term vision and growth of Degen Chain and L3s, emphasizing the importance of enabling and empowering onchain communities.

• 47:21 🚀 Degen Chain and L3s are focused on low transaction fees, attracting users, and integrating with other projects to build a strong community and support developers.

  • Low transaction fees and incentivizing builders are key to the success of Degen Chain, with the focus shifting to attracting users in the future.

  • Excited about the potential of Degen Chain and L3s to grow communities and support developers, with a strong foundation and usage.

  • Developers are excited to see who will build the NFT Marketplace for Degen Chain and L3s, as it offers a unique sandbox for customization and potential for a large user base.

  • Degen Chain and L3s are open for integration with other projects, with partnerships and grants helping to bootstrap and build a community around the token.

  • The speaker discusses the potential of Degen Chain and L3s in integrating with various applications and the need for a more community-based ruling on the best apps.

  • The audience is encouraged to follow the speakers on social media and reach out to them for further discussion.

INSIGHTS

L3 Innovations and Business Model Innovations

• 🔗 L3s are one of the most exciting Innovations in crypto in the past six to 12 months.

• 🌉 The combination of technical innovations and modularization of blockchains unlocks new business model innovations at the L3 level, paving the way for high volume experimentation.

• 🌍 Syndicate's long-term vision is to decentralize into a network technology and support a wide range of applications for onchain communities, from social to gaming to creators.

• 🛠️ Customizability will become the primary reason for people to choose L3s, as they offer the potential for inserting custom code and bringing in on-chain social use cases.

• 💡 The idea of customization in blockchain solutions, similar to npm for JavaScript, could be a potential game-changer in the startup space.

• 📱 The L3 could be the "iPhone moment" for crypto, opening up new possibilities for rich and innovative applications.

• 🚀 The hard part is everything that comes after standing up the chain, and there's still a significant amount of contribution to Degen Chain that hasn't been publicly shared yet.

• 🧩 The Degen chain and L3s provide a new sandbox for developers to play in, with the potential for unique applications that cannot be easily ported over from L2 or L1.

Customizability and Interoperability in Blockchain

• 🔄 Different visions of interoperability in the blockchain space, such as composability at the rollup level and the shared sequencer vision, highlight the complexity of scaling and interoperability.

• 🎮 More data on chain will allow for the building of richer onchain applications in areas like social, consumer, and gaming.