The Trustless Trade Supply Chain by Markus | Devcon SEA

[Music] [Music] thanks Bridget um we're actually going to add one more piece to this it's going to be about the trustless and decentralized uh trade supply chain so I want to um give you all a little bit of empathy for what it's like in the trenches between Unis Swap and the settl layer and how a swap actually happens and what work is still to do there so that more researchers and Builders can make sure that this part of ethereum also stays uh decentralized um what I mean by supply chain is from the UI like metamask to an aut book like cwap to a solver um like barter to a builder like Titan to a proposer like theerum validators um there's a lot going on and much of the research that we do today focuses on the last part the proposer however all of these other parts that we have in front of them are at the moment for the most part trusted and centralizing this is common knowledge to people who are paying attention to PBS and the solver Market however we're taking it nowadays as for granted and inevitable but if we do then we are in trouble this is um metaphoric image for what defi looks like if we want to build economy on top of defi then defi is majorly built on the trade supply chain whatever you want to do lend leverage swap you're ultimately going to end up depending on the solvers and the builders to do these interactions and if we have a decentralized settlement layer and we don't have a decentralized trade supply chain then we don't really have defi we will end up in the same mess that we have today this is a photo I took in a Thai Pharmacy and they charge 3% on using Master Card and there is a explanatory image of why you charge 3% for that um this is a result ultimately of a trusted system that introduces two high barriers of Entry that leads to centralization and then ends up leading to Monopoly pricing also to inefficiencies I tried to send uh at the moment I'm waiting for money to arrive in Mexico um that urgently is needed there and it's been taking three days and it's still not there yet because sometimes um the a takes three to four business days um these are unacceptable and you cannot build a functioning economy on such high friction infrastructure this is the same thing that might happen in defi if we don't pay attention to keeping the entire trade supply chain decentralized and trustless now that poses the question what makes decentralization ultimately possible and there are bunch of things that you can think about but they all come down to simplification and I'm going to try to convey this in a picture if you sometimes I think about the market or the economy as a whole as a sort of fractal right you have all this blue ocean where the valuable contributions are still to be uncovered for how do you actually build products that have help and improve uh society and then you have the dark spaces that we already uncovered like spending time here and spending effort in the dark spaces will not ultimately innovate will not ultimately add anything new and to add something new you need to get to the edge and then you can contribute however a market where there's a large distance between the current state and the edge that is a market that leads to centralization because it's a large barrier of Entry you alone will not be able to cross this barrier you need a team of 100 people and it favors economies of scale so it leads to centralization now we already have one successful system that manages to decentralize a highly centralized system ethereum is ultimately a decentralization of the interbanking settlement layer to some part plus a lot of more features but that's like the Baseline feature and how did it do so well it did it by taking taking all that code and all that um work that is now bunched up in this interbank settlement layer and open sourced it right there's a lot of effort that went into the eum client open sourcing it made it so easy to use that validators can now run such a complex system and it's much easier to innovate now you can build lending swapping on top of that and it's a much shorter distance to contribute something valuable this ultimately leads to innovation and also enables decentralization because you can have individual actors contribute now the second part is verifiable execution we're not going to get to that bit um in this presentation but also verifi execution helps you make things simpler because you have less trust assumptions where are we today we're Building Systems I think flashboards buil our Builder and Bob that is a trustless builder um we published yesterday um ERC 7815 which is a call for solers and routers to um make a standardized interface to Dex liquidity to make solving easier um ultimately then leading to Tao which is a to open source Tool uh to index and simulate and execute over Dex liquidity and the same for order books and UI there open questions there um the future though goes much further and I'm excited about a lot of applications that are still to come if you have the starting pieces for a decentralized trade supply chain such as a open- source indexer then you can easily or more easily move further down the skill tree and build an open source solver once you have an open source solver you can have a trustless solver in a te or in any other cryptographically verifiable way once you're there you can maybe also do trustless 6X Arbitrage eliminating more of the value capture um and centralization vectors or if you have a trustless auction you finally can have second price auctions which are significantly more efficient and less effort for the participants now this is just a starting point I think that we can go way further um than just this first skill tree I I drew here um so yeah I encourage you to think about the entire trade supply chain when you think about decentralizing defi it's not just about decentralizing the settlement layer of course that's where we have to start but there are many other open questions yet to decentralizing and making trustless the entire trade Supply chain the tools to get there are open sourcing difficult things like solving and building building standards together so that we're composable and we have lower barriers to entry and furthering our ability to have verifiable execution if you want to work on these things you're a researcher router solver Dex reach out um and we're happy to to help you uh build those projects thank you thank you thank you that was the uh the end of the time that we have today for our lightning talk um in the end of the day in the programming for today on this stage um I hope everybody had a wonderful