coder / lawyer. research at @paradigm. automated research reply guy
San Francisco, CA
- Tweets 9,959
- Following 1,306
- Followers 84,309
- Likes 9,185
There are a lot of components of Blast that I’m excited about and would be interested in engaging with people on. That said, we at Paradigm think the announcement this week crossed lines in both messaging and execution. For example, we don’t agree with the decision to launch the bridge before the L2, or not to allow withdrawals for three months, since we think it sets a bad precedent for other projects. We also think much of the marketing cheapens the work of a serious team.
We backed Pacman and his cofounder because they demonstrated an ability to build great products over many years, starting with Namebase, one of Paradigm’s first investments. Next, they worked on Blur, a cutting-edge pro NFT marketplace. I got to witness their exceptional technical talent firsthand when I collaborated with them on the design of a new NFT-collateralized lending protocol called Blend. When Pacman told us he had a vision for the L2 chain that he wanted to use to scale Blur and build on its success, we invested behind him again. We still think they are world-class builders who can deliver an L2 that brings value to the ecosystem.
We’ve been discussing our concerns with the team and appreciate their willingness to engage with us, but there are still many points of disagreement. We invest in strong, independent founders who we don’t always agree with. But we understand that people may look to us to set an example on best practices in crypto. We don’t endorse these kinds of tactics and take our responsibility in the ecosystem seriously.
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We’re thrilled to release Ivy for Bitcoin: the first-ever high-level language and IDE for creating and using Bitcoin smart contracts blog.chain.com/ivy-for-bitco…
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Typos used to be a negative signal that the author didn't proofread their work
Now they're a positive signal that the author actually wrote any of it
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Building some interactive demos to help teach Uniswap math.
What do you think?
desmos.com/calculator/7wbvkt…
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I know moderation at scale is very hard, but you would think that after 13 years they could implement basic heuristics like “don’t let verified accounts change their name and profile picture to match a different verified account”
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Uniswap v3 is now public, after eighteen months of research and development: uniswap.org/whitepaper-v3.pd…
I think it’s the best DEX design on the planet.
If you've heard me cryptically address a problem by saying that "Uniswap v3 fixes this," now I can finally explain why.
1/
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Someone accidentally locked up some tokens in an Ethereum smart contract.
@gakonst and I thought we'd found a way to recover them.
We learned that the mempool is a very creepy place.
link.medium.com/RXsMy9Iak9
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Crypto adoption is bottlenecked by hardware access.
@JamboTechnology is building the largest onchain mobile network. They've shipped 700,000+ phones to 120+ countries.
Here’s why I'm impressed with what they’ve accomplished and proud we were early supporters 🧵
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If your project is using token incentives, you should probably try removing them and see what happens.
If your response is "but we're worried users wouldn't stick around"... then you should DEFINITELY try removing them.
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Kinda relieved that DeFi hadn’t “figured out undercollateralized lending” for this cycle
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The Uniswap v4 whitepaper is now public: github.com/Uniswap/v4-core/b…
Uniswap v4 continues the evolution of Uniswap into a flexible platform for DEX innovation, with its support for permissionless deployment of new pools that use custom “hooks.”
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If you work with Ethereum data, this tool might change your life: abi-parser-nvk.vercel.app/
You can enter any contract address, and it looks up the ABI and generates queries that can be run on BigQuery to create parsed tables for each event or function call on that contract:
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First page of every ZKP introduction: “Imagine you have a Where’s Waldo book and want to prove you know where Waldo is with a piece of cardboard…”
Second page of every ZKP introduction: “If we replace FRI with pairing-based Kate commitments, recursive composition becomes…”
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Five reasons I think UniswapX changes the game for decentralized exchange, MEV, and interoperability 🧵
uniswap.org/whitepaper-unisw…
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New Paradigm research from me and @ciamac!
Prediction markets were the original motivation for AMMs, but today they mostly use orderbooks
One reason: outcome tokens don't behave like other assets
We present the pm-AMM, a new invariant designed for prediction markets
🧵
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Finally figured out how to use Twitter like a VC and it’s extremely addictive
Might never go back to doing my own thinking
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I don't think there's much alpha left in designing new AMM invariants
The next generation of DEX features are going to be about fair execution and tx cost minimization, not new shapes for reserves curves
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Introducing Blend!
@blur_io wanted a lending protocol with:
* Arbitrary collateral, including NFTs
* No oracles
* No expiries
* Market-set interest rates
So @transmissions11 and I worked with them to design a new mechanism
Here’s how it works 🧵
1/ Introducing Blend: the Peer-to-Peer Perpetual Lending Protocol for NFTs.
Built in collaboration with @danrobinson and @transmissions11 at @paradigm, Blend enables 10x higher yield opportunities than current DeFi protocols and unlocks greater liquidity for NFTs.
Here’s how 👇
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Uniswap is arguably becoming the primary market for ETH
New research from @gordonliao and me shows that Uniswap v3 has deeper liquidity in ETH/USD and ETH/BTC than leading exchanges like Coinbase and Binance
paradigm.xyz/2022/05/the-dom…
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Uniswap has been fighting for the core principles of crypto since they launched. To me, they stand for the idea that immutable peer-to-peer financial technology is not only possible, but inevitable. That it can win.
It’s unfortunate that the SEC is forcing them to take that fight to the courts, but DeFi couldn’t have hoped for a better champion.
🦄
Today @Uniswap Labs received a Wells notice from the SEC.
I’m not surprised. Just annoyed, disappointed, and ready to fight.
I am confident that the products we offer are legal and that our work is on the right side of history. But it’s been clear for a while that rather than working to create clear, informed rules, the SEC has decided to focus on attacking long-time good actors like Uniswap and Coinbase. All while letting bad actors like FTX slip by.
When I first set out to build Uniswap, the goal wasn’t to reimagine finance.
It was an experiment in radically decentralized, fully automated onchain markets. I didn’t know if it would work or if anyone would use it.
Fast forward to today, the Uniswap Protocol has processed over $2 trillion in volume. Many thousands of teams and developers have forked our code or built on top of it. We built entirely new financial infrastructure that is transparent, fair, secure, and accessible powering an entire industry.
The team at @Uniswap did all of this in the US from our office in New York City.
People often ask me why we stay in the US and my answer is simple: I believe that blockchain is incredibly powerful technology. Like the Internet, it’s here to stay. So someone needs to figure it out, and it might as well be us.
And that when you build technology that improves people’s lives – you don’t need to hide.
The @SEC’s mission is “protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation.” This is a noble mission. I would argue @Uniswap does a far better job of this today than the SEC.
Yes, I'm frustrated that the SEC seems to be more concerned with protecting opaque systems than protecting consumers. And that we'll have to fight a US government agency to protect our company and our industry.
This fight will take years, may go all the way to the Supreme Court, and the future of financial technology and our industry hangs in the balance. If we stand together we can win.
I think freedom is worth fighting for. I think DeFi is worth fighting for.
And of course, we won’t stop shipping. Stay tuned
🦄💜
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Here is my testimony from the Senate Banking Committee last week
I focused on the promise of DeFi—which does for trading and lending what stablecoins do for payments—and how market structure legislation must not inadvertently harm it
Link to longer written testimony in 🧵
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Introducing the auction-managed AMM!
A new AMM design that:
⚖️ Reduces LVR
⚙️ Optimizes swap fees
📈 Smooths LP returns
🌊 Should attract higher liquidity than any fixed-fee AMM
New paper with @ciamac (@paradigm / @Columbia_Biz) and @aadams @saraareynolds (@Uniswap)
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This thread is the purest instance I’ve seen of a very common misunderstanding of how AMMs work.
It’s just wrong. The math in it is wrong, the mechanics are wrong, and as a result, the conclusion is wrong.
0/ Uniswap only works because Ethereum is slow, *and* because Uniswap LP fees are expensive (30 bips)
Normally, when you combine two bad features, you get something extra bad
But in this case, negative * negative = (almost) positive
How can this be?
A thread
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Matt and Fred took a chance on hiring me when the idea of embedding a protocol researcher at an investment firm was a weird experiment.
Now we’re doubling down on the mission of building an industrial research organization within @paradigm.
1/
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The dirty secret of crypto Twitter is that you can get like 1000 RTs for a "technical" explanation that is total bullshit
Just remember to end your first tweet with "buckle up for a deep dive 🤿🧵👇 1/"
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Anyone who says that blockchain will protect us from naked shorting or complex derivatives or unsustainable leverage has not looked very closely at where DeFi is heading
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If you start incentivizing usage before you've found product-market fit, you hopelessly scramble the signals you need to find it
You might decide it's worth it, but know that you'll be flying blind
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Most books should be papers
Most papers should be posts
Most posts should be threads
Most threads should be tweets
Most tweets should be replies
Most replies should be thoughts
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Suppose you have a protocol that lets you split 1 USDC into two tokens, 1 of token A and 1 of token B.
Anyone can redeem 1 A + 1 B to get 1 USDC, at any time.
What price will these tokens trade at?
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I think it is bad form, and a bad strategy, to try to summon the regulatory demon to strike down your competitors over technical or ideological disagreements
Where will you hide when the demon turns around on you?
A centralized sequencer that can change the matching/execution of orders obviously must be regulated. Otherwise, any exchange could set up an "imutable matching engine program" and then run on their own server provider in order to bypass all US securities law. The base contract is upgradeable. The multisig can stop trades from going through the slow path if they want to.
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There's a lot of worthy competition but IMO the nastiest, most shameful bad-faith crypto lawsuit ever is still the ex-Warren staffer who put $10 into PoolTogether so he could sue the creators for running an "illegal lottery"
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This talk convinced me that Ethereum can implement multiple concurrent block proposers
@maxresnick proposes a new design called Braid, based on the simple idea of running many instances of Ethereum consensus in parallel
I think this could become a defining part of the roadmap
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The more time I spend wrestling with crypto market structure policy, the more I like the “Certificate of Dumb Investment” proposal from @matt_levine
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Bankless seems weirdly underrated, just a couple guys who work hard to put on a good podcast, I don’t get why people get deranged about it
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Uniswap v3 flipped SushiSwap on volume in less than 4 days, but that isn’t the important part.
The important part is that it did it with less than 10% of the TVL.
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Stages of Twitter:
<10k: earnest tweeting about your interests
10k-100k: optimal shitposting zone
100k-1m: can’t tweet anything other than vague philosophy
1m-10m: can’t even tweet the vague philosophy anymore. nobody at this level has ever tweeted
10m+: back to shitposting
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Three hundred years from now, Ethereum haters will still be talking about the “premine” and “DAO fork,” with the meanings of those words having been lost to time
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I'm testifying to the Senate Banking Committee tomorrow!
I'll be talking about why it's important to protect DeFi as part of any market structure bill
What should I make sure to mention?
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Conference tickets are a joke
In almost all cases the conference is just an excuse to be in the city and nobody goes to the talks
Just go to the city without a ticket
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Today I'm publishing a new design for an off-chain decentralized exchange built on synthetics: the 🌈 Rainbow Network 🌈
- Supports any liquid asset (even non-crypto)
- Supports leverage and shorting
- Implementable on Ethereum, or on top of Lightning
rainbownet.work
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New mechanism with @_Dave__White_!
We present MEV taxes, a technique that:
* Lets arbitrary apps capture their MEV
* Preserves composeability
* Would work today on OP Stack L2s like @Optimism @base @Blast_L2
The secret? The surprising power of priority ordering 🧵
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Bar trivia question: “what did Satoshi Nakamoto invent in 2008?”
Answer: “Blockchain. We will not accept Bitcoin as an answer, he did not invent Bitcoin”
?!?!?!?!?!?
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We’ve had a great partnership with @PacmanBlur over the years and I’m excited to collaborate on research for Blast in the years to come
One interesting example is their design for rebasing tokens, which I initially pushed back against but they convinced me could work
It avoids the classic rebasing problems because 1) it’s opt-in for contracts, and 2) it’s the native token, which contracts already need to special-case
I think natively rebasing tokens denominated in ETH terms (with risks disclosed) could help strengthen ETH-as-money on Ethereum L2s
Building a non-standard ERC-20 token (such as fee-on-transfer or inflationary/deflationary balances) is one of the nastiest things you can do to smart contract developers, wallet developers, and users
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funniest timeline confirmed
wsj.com/articles/citadel-ceo…
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I met some college students at a crypto event and suggested I could follow them on Twitter and they looked like I do when people ask to connect on LinkedIn
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Every Ethereum researcher is focused on MEV when their biggest problem is scaling
Every Solana researcher is focused on scaling when their biggest problem is MEV
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New interactive visualization of Uniswap v3, showing how concentrated liquidity behaves as prices change:
desmos.com/calculator/i8h0wz…
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My tweet got cited by GIPHY, in an antitrust filing, in support of the proposition that GIFs are cringe
theguardian.com/technology/2…
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If you see something inexplicably successful but a little sketchy
And are tempted to sell out by getting a little sketchy yourself
Know that there’s probably an ocean of sketchiness under the surface and that success on that path may involve much more compromise than you think
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L2 innovation isn’t competitive with L1—I think it’s L1’s best hope
The Ethereum L1 upgrade process is necessarily slow, conservative, and political
The best part of the L2-centric roadmap is that L2 innovation can happen 10x faster and there are 10+ teams doing it in parallel
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DEXes leak value to miners through three kinds of MEV:
1. Gas costs
2. Slippage/sandwiching
3. Loss-vs-rebalancing
Reduce any of these leaks, and you preserve more value for swappers and LPs.
So each of these categories corresponds to a promising line of DEX research.
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To set a better precedent for future projects who may try to emulate them, we worked together with Blast to design a new timelocked upgrade system that they will upgrade to next week. The code is open sourced here and free for anyone to use.
gist.github.com/blast-io-bot…
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Uniswap v3 is so flexible that it can simulate any static automated market maker.
My new post shows how this works, and how other AMMs like Curve, Balancer, and LMSR can be built on top of Uniswap v3:
paradigm.xyz/2021/06/uniswap…
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These are the cumulative 15m markouts for the Fluid ETH/USDC pool.
It has bled out $8.5m in EV, and its trades were unprofitable all the time, not just during rebalances.
There are no profits to make up for the costs from rebalancing. The pool never makes money in expectation.
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Suppose it turns out that it's impossible to have a secure proof-of-work blockchain without a block reward. Which change to Bitcoin would you be more willing to accept?
20%
Remove the 21M cap
31%
Switch to proof-of-stake
26%
Let it die
23%
I'm bad at hypotheticals
12,275 votes • Final results
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Wrote up an idea for a new DeFi primitive: yTokens.
- Fixed-term secured lending
- Debt is fungible and can be traded on @UniswapExchange
- Interest rates are implicit and determined by market
- Can be used to construct a yield curve
The Yield Protocol: research.paradigm.xyz/Yield.…
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.@paradigm has established a position in Unisocks ($SOCKS)
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In protocol design, game theory is overrated, data structures and algorithms thinking is underrated
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“Don’t use chains with centralized sequencers, since someday they might subtly extract value from you
Instead use decentralized sequencers that are guaranteed to extract maximum value from you, today”
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It's only a matter of time until someone pioneers the retroactive-airdrop-to-Twitter-followers and completely ruins this site
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If your biggest concern about AI is either that it is too woke or not woke enough, you might be missing the bigger picture
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You'd think there would be a tradeoff between speed and quality
But the fastest developers I know are also the most obsessed with correctness, performance, and style
Maybe it's just quicker to do things the right way
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TL;DR: Bitcoin HODLers can afford to use a slower chain for way longer than miners can afford to mine a cheaper coin
I just published “The cost of supporting the B2X fork: how to lose $100m in ten days” medium.com/p/the-cost-of-sup…
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The debate about whether MEV should go to L1s, L2s, or apps is somewhat missing the point
MEV should go to the user it came from. And I think in the winning system, to the extent possible, it will
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Sometimes at conferences people ask me how they can become more crypto-native, and I just apologize as I take their phone and make them follow @inversebrah
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How do you construct a lending protocol that supports arbitrary collateral, has no oracles, and has no expirations?
Read the whitepaper to find out: paradigm.xyz/2023/05/blend
(hint: when in doubt, try Dutch auctions)
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Bitcoin maximalism could be based on either of these beliefs:
1) Everything in crypto could be built on top of Bitcoin
2) Nothing in crypto should be built other than Bitcoin
The second is a normative claim and I don’t have much to say about it
But the first is a delusion
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Before massively subsidizing the supply side of a market, it's good to check if there's demand
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I’m excited to announce that I’m joining @paradigm as a Research Partner, to help @matthuang, @FEhrsam, and @_charlienoyes build a new kind of investment firm.
medium.com/@danrobinson/join…
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I don’t think whether a sequencer is decentralized matters too much
What matters most is what rules they follow, and particularly whether they use their power to hurt users or extract value
You can have extractive decentralized sequencers, or nonextractive centralized ones
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Bancor is such a joke
Bancor sues Uniswap for patent infringement over DEX smart contract tech theblock.co/post/355056/banc…
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From a friend who’s getting back into crypto. We still have a long way to go in making this tech useable
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You can buy and hold Treasuries directly from the federal government at treasurydirect.gov
But this is how their website works:
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New Uniswap v3 visualization: how multiple concentrated liquidity positions behave when stacked on top of each other in the same pool!
desmos.com/calculator/qknhcr…
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