Layer 1 Stage | DeFi Onramps: How to Build a Better Multi-Chain Experience

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1. 0:01

   please welcome our MC to the stage near foundations Abby Shake vathan good morning everybody how's everybody doing this morning woo I want to hear a little more energy here how is everybody doing this morning W welcome to NC con it is my distinct pleasure to welcome up our first panel before that I'm abishek V senior councel at n foundation and it's my first ncon so uh I'm very psyched to be here with everyone this morning we've got our first panel defi onramps how to

2. 0:41

   build a better multi-chain experience moderating this panel is Felix mcart from Greenfield so I'd like to welcome him up and uh let's get this party started hello everyone good morning I'm super excited to be talking today about the defi on Rams how to build a better multi trading experience with this wonderful panel here uh to my right we have Josh Lee he's the co-founder osmosis uh

3. 1:30

   an interchain liquidity Hub and also Kepler which is a wallet for the cosmos ecosystem then we have uh uh we have chess holgrave who is the CEO of wall connect basically uh building uh a solution to connect all types of wallets to to daps and we have Carson Brown who is a senior protocol manager at Gauntlet and they are largely advising protocols on on risk management and also uh on on certain multichain issues so yeah we have we have an

4. 2:04

   ecosystem of various blockchains across several layers emerging and that means we get more scale we get more diversity and and specialization as well U but that also means much more complexity which can potentially overwhelm users and also lead them to tap into security pitfalls so uh which means we need to be really thoughtful about designing use experience and Abstract complex complexity for for end users so uh yeah

5. 2:36

   I want to start out with how how it how does it in your mind look like to have a great multi chainx start maybe you want to start Josh um yeah uh I think from my perspective I think it is inevitable that all of crypto is going to go multi-chain uh the path there is I think fairly evident and we've seen the industry sort of go that way the part that we haven't figured out is how do we sort of create interoperability at the

6. 3:08

   user layer uh rather than the technical layer uh and yeah I'd like to kind of open up with that and see what you guys have to think about that as well so at at wallet connect um we have built in a deliberately chain agnostic way from the very beginning and wallet connect started as a protocol to connect daps and wallets um and allow auth and sign messages basically um that's that exist offchain but allow allow that connection and so the the motivator for

7. 3:39

   that for our founder Pedro back in 2018 was to create better end user experiences um it's that QR code that many of you might be familiar with when you're logging into an app how do I use a mobile wallet on a desktop application um and over the last 5 years that's something that the team has really worked end LLY to try and improve whether that be um implementing different Frameworks so we have mobile native now and other ways so I think it's really um it's for me it's all about that end user experience there's a

8. 4:12

   lot of very exciting things that happen at the technical layer but in order for uh Defi and that's the topic of this panel but in order for crypto to uh to continue to expand and bring in people other than the sort of the the the early Geeks that we all identify with that get really excited about this how do we create enduser experiences that feel safe that feel familiar um and that ultimately deliver real value to those end users yeah I think that's a great point

9. 4:42

   and when I think of you know user experience uh across multiple chains I think one of the things I try to think about is like consistency and expectations I think um one of the barriers right now is generally when going to a new chain it comes with a new learning curve um and I think bringing that barrier down really improves the user experience um because generally you're going to another chain to achieve

10. 5:04

    some type of goal and so either it offis skates that cross-chain experience or if you're intentionally going to another chain kind of reducing that level of a learning curve so you can get closer to accomplishing your goal faster yeah so how much does the user actually know or need to know in order to use multiple chains and like how how can we cater to different types of user personas like are are there users that want to kind of

11. 5:29

    Max out on like the potential of different chains and probably others that want I I think realistically the challenge here is like um just the different standards of different ecosystems right like for example name services are different based on which layer one service that you use you know how end points work in the background are all very different um and it's hard to know how far a user will go right like you can abstract a

12. 5:57

    lot of these things up front and then later once they become an advanced user who wants to do something and realize because I'm locked into a standard which in the very beginning helped me onboard way easier but later realized this is completely incompatible with the rest of the crypto ecosystem then you know you sort of stuck in this you know Loop where the benefit that you got early on for onboarding cost you the

13. 6:21

    opportunities of um expanding into kind of other standards and things like that so you know there is this benefit of ux but it also comes typically at the cost of compatibility standardization um and yeah it's it's always kind of a careful balance when you're trying to design user-facing systems with kind of the blockchain with all of its decentralized like technical development um specification and things like that you know you no longer have someone to call and say hey this isn't

14. 6:52

    working for us can we change the standard because you know that could take years to to you know actually happen so um yeah it's always a very hard balance in from our experiences I think you bring up a really interesting point there around standards which is um something that I think at the moment individual ecosystems are very good at but as an overall ecosystem we're not um we've

15. 7:18

    been working a lot on the Chain agnostic improval uh Improvement uh um proposals sorry I can't speak yet this morning need more coffee um and though those are really designed to work in a cross ecosystem way so how do we take standards that we identify working really really well in a single in ecosystem and ex make those extensible so that other ecosystems can start to adopt them um and naturally within ecosystems there's a um you know the our

16. 7:51

    interests aligned to create a lot of a lot of compatibility or do you want to hold your users within your ecosystem and keep them there and I think that that's something that a lot of layer ones layer twos are really wrestling with right now but I really believe that we we are going to have this multi-chain future and if we want to deliver better end user experiences having these shared standards that exist um across the

17. 8:15

    ecosystem I think will will benefit us all um but they're very very hard to do if you're in sort of making standards proposals in a single ecosystem where there's a lot of alignment we already know that that is hard to Implement um and doing that on a chain agnostic basis um is is even harder but I think it's going to be really essential to the growth of the ecosystem and I think also tapping into some of that question you asked about personas I think it depends on the user it also depends on the type of

18. 8:47

    application the user is hoping to use I think if you have an experienced user who's trying to do something in defi as they're bridging over you know they're going to care about the liquidity depth of whatever token they're getting on the other side they're going to care about if they need gas tokens and also care about the reach of whatever token they end up getting whether um it has a lot of use cases and a lot of different protocols on the flip side if you have a maybe relatively inexperienced user and

19. 9:12

    they're interested in some type of gaming application all the stuff doesn't really matter to them and so it's kind of all about catering the multi-chain experience to the use case and the experience of the user I think that's why we're starting to see um you know different Bridges and different kind of multi-chain adapters built into the applications themselves because it's really hard to kind of give that control off to another uh a different you know

20. 9:38

    Bridge provider yeah Bridges is definitely an interesting topic a very important topic I want to touch on that a little bit later again um but first maybe uh Jess do you want to share a little bit more about the work wallet connect is doing in standardization since you brought the point up as well yeah so I I think um one of the one of our core philosophies is to be fully chain agnostic um in a in a world where there are more and more

21. 10:07

    chains and more variety of chains that becomes increasingly hard for us um but it's something that we that we still really never Endeavor to do and so at the protocol layer um that is built with such um low opinionated uh kind of technology that it ex it can be built on and compatible with any chain the higher up you get in our stack of sdks the the more opinionated they become and the less generalizable they come but we are we're starting to expand those from a standards perspective wallet connect has

22. 10:39

    always been um very focused on the evm ecosystem and building standards there but it was a couple of years ago that we really started with the cips and I think we're up to some 130 140 different proposals with that right now um and more and more chains are starting to get involved with it that think is going to be um going to be a helpful for us to build great end user experiences at that intersection between apps and wallets um but also just for for end users um so

23. 11:12

    you can imagine um sign in with ethereum that people are talking about uh there's a proposal under CIP right now for sign in with X so the idea would be that there is a shared standard across across ecosystems for that um and there are many many of those being proposed and and I think we're really excited to see the growth of that um that community and and and those those proposals coming

24. 11:35

    through um part of the challenge is is how you actually get those implemented right and so that there are some great proposals out there um but delivering really amazing end user experiences depends on the cooperation of those chains um we are we've been incredibly lucky over the last few years to work really um broadly across different chains different wallets and different applications and so um you know it's a lot of the team at wallet connect are really focused on on driving those

25. 12:05

    forwards but I think um you know I would encourage chains Builders to take a look at those too um because I think that that's really going to deliver the end user experience which to Carson's point is going to really vary as to what they want out of these products um how experienced they are what their tolerance for risk is what their tolerance for fees are um and that's one of the things that excites me about the defi ecosystem right now is we're

26. 12:35

    starting to see that variety and we're starting to see applications that are catered For more experienced users for Less experienced users um and I think as defi continues to grow and also becomes more embedded in other applications whether it's gaming or other things um they'll have different needs there as well um and so defining those standards really clearly is going to be um is going to be important mhm do the others have any finds on on

27. 13:07

    standardization maybe also like how to integrate that in in capital wallet yeah uh I think from my perspective it's kind of a you know I I always bring up two sides of everything but there's also this like incentive issue where you know you could sort of have someone standardize something but you know why should someone actually use this standard so kind of the other flip side of this is like I think there is is a very Market driven strategic way of

28. 13:31

    things being standardized right like as evm gets used in more rollups uh layer 2os things like that we have seen kind of you know a lot of the evm standards gets uh ported over to other chains as well even if in the lack of like a clear standard of how to do it so I think there is there definitely needs to be some sort of like balance of we're not overp specifying things and leaving room for just kind of you know users and markets and incentives to play out right

29. 14:01

    uh we're going to see different potentially conflicting standards and we're not going to have someone to say hey which is the right decision here at the end of the day it is it could end up in a competition it could be a little bit messy but hopefully at the end of this you see kind of a more organic standard emerge uh you know alongside kind of some level of you know let's let's at least agree to you know

30. 14:26

    standardize on few fairly non-controversial things as well so yeah yeah in my head I keep going back to a not not a blockchain comparison but thinking about uh iPhone ports and thinking about kind of the debate going on with USBC and lightning ports and it's a balance of innovation you know Apple says oh man we shouldn't use USBC we want to use build better and better plugs um and then there's kind of like the Builder point of view it's like well

31. 14:57

    we need to standardize this so that Builders and you can have an ecosystem where other people can tap into this I think it's kind of the same thing here where like standardization will help the builders because they can have um they can come into a new ecosystem with an expectation of how their applications might fit into it um and then there's the Innovation side of it where it's like well what if I want to build something that doesn't necessarily fit into this standard um so I think it's

32. 15:21

    all about kind of balancing it and and we see these kind of these discussions play out in you know multiple Industries like like plugs so yeah yeah definitely I guess I mean you touched also about like the evm how I guess that has emerged as like the standard and a bunch of other virtual machines have maybe advantages but so far like still most activities on evm chains but yeah there's like we'll see

33. 15:47

    how this how this plays out yeah and and the thing is I think there are plenty of people who would say the standards currently implemented on the evm site isn't perfect but it's like all right it's you know it's adopted everywhere at this point that it's too hard to kind of rewind these changes then just sort of go with it and you know improve it from there on kind of thing right so yeah I guess often it's something that

34. 16:10

    that's that's good enough that then gets adopted widely but um I guess like how can how can wallets actually simplify the experience for users like given that you have in some some ways you have standardization but then uh in other ways you you don't and you need to maybe shift between different chains and um also you need to bridge like we we're going to talk about the risks in in a bit regarding that as well but um yeah how how does a wallet make it easy for

35. 16:42

    users to just interact with chains yeah I think one of the largest changes that we implemented where you know cosos is fairly multi-chain and you know we do see kind of crypto ecosystems outside of cwos as well going to this multi- chain Direction and One fairly major paradig shift that we had to implement was remove the notion of kind of a token being in one blockchain and what I mean

36. 17:06

    by that is now you can have eth on every other chain in basically all of crypto so how do you show that right like so previously you know you would only assume that eth only existed on the ethereum main net but now it's sort of everywhere so I think one of the first things that we did was you know previously you had to expli explicitly set which network you're active on as a wallet right so me as you know 0x12 3 4 uh and interacting with ethereum mainnet

37. 17:39

    if I want to do it on polygon now I have to switch this thing uh whereas now you know it's sort of the norm that you may have an application that has a transaction that's getting sent out on ethereum also on polygon and the fact that you would have to switch every single time uh would just be a massive pain so uh trying to kind of remove the you know idea of connecting to a specific chain and building interaction

38. 18:03

    points more focused on what is the user trying to do and typically you know in the current market that has a lot to do with what token am I trying to move you know what nfts am I trying to buy so kind of putting you know previously I think in the hierarchy of how ux was like information was shown chains were sort of the first thing that you had to select I think now we're kind of

39. 18:27

    reassessing and realizing hey chains are sort of something that's underneath the token the asset the contract more contextual to that rather then you know I would like to on ethereum in track with this token now you're sort of going into this Paradigm of I would like to move this token from ethereum kind of thing so I think that would be kind of the role that wallets have and then

40. 18:50

    ultimately you know one issue that we have with bridging is there are so many different Bridges and sometimes it's hard to know what's safe what's not you know what's fast what's cheap and yeah it that's you know that's kind of TBD from our perspective because you know we may push to a very cheap and fast bridge and later realize it was unsafe and then you know it wasn't the cost of it wasn't

41. 19:13

    very apparent when we were pushing users to it but it could pay off you know it could be a big price to pay at a later point when that bridge gets hacked or something right so um from our perspective you know we're not always trying to push the user to what seems to be the easiest cheapest fastest solution but also have to be this like moderator of hey you know we do have more

42. 19:35

    technical depth than the average user and there are opinionated decisions that we make in terms of which you know service Bridge providers that we push towards because there is this risk that you know the average user may not know about right and even if that means at the cost of you know slightly more time for that bridge you know bridging to Happ happen or slightly higher transaction cost so yeah I I think that's one of those more opinionated decision that each wallet can you know

43. 20:06

    independently make based on their assessment um rather than kind of this one siiz fits all for you know all ecosystem all wallets all dabs kind of thing I think that's also where we have to do more to help end users to understand those decisions and explain what we're doing and why um so you know giving people options ity but highlighting the risks or um demonstrating like this is why this is the recommended Bridge there are these

44. 20:36

    other Alternatives but they come with a user kind of Bier beware uh narrative because I think especially as we bring more people onto these platforms those are the people who are going to see oh this is just lower fees I should go there when maybe the liquidity isn't there maybe there other risks as you say so I think that we have uh in all those user experiences those user interfaces

45. 21:01

    that we're creating we also have an obligation to help pass on that knowledge and and educate our users um around why these decisions are made for them and or why those recommendations are made for them um because that ultimately gives them uh more freedom overall helps keep them safe um and gives them more control which is what we're all here to do um but we want to do that in a way that's not just off you go and good luck but actually like let

46. 21:31

    me help you get to that state um yeah I think both of you nailed this question I don't have a ton to add I would just tie it back to what I had said I think to the first question about learning curves and I think with you know when you're using a wallet that is going across multiple Chains It's really just about abstracting away some of that learning curve when you go to a new ecosystem uh and make sure that you can

47. 21:55

    essentially have the same kind of smooth interface and basically have that learning curve be built into the wallet instead of uh for the ecosystem itself yeah and what are the types of risks you would watch out for when analyzing Bridges or generally also advising clients and protocols what what types of bridges to to implement I guess like regarding standardization there's this other point where you have like multiple different derivative tokens of different Bridges then that can also be confusing

48. 22:26

    in the end for for for for users that might not be inherently super risky by themselves but I guess mhm yeah I think one of the things we're seeing right now is these bridged assets are coming with an additional cost associated with them generally that's in liquidity depth but as well as just kind of um how willing users are to hold them when these Bridge tokens are in protocols they're

49. 22:51

    generally uh at a higher cost as well just because you know unfortunate as it is you know Bridges have been one of the largest uh you know hacking destinations and because of that these bridged assets are viewed as riskier assets um so I think one of the things that we've been noticing is just kind of like how that risk is being transitioned over to the users and it's something that users need

50. 23:16

    to be aware of as they're using bridged Assets in whatever dii protocol they're uh interested in I think the other part of it would also be just being able to uh count on this liquidity I think as liquidity spreads out across multiple different chains um you know one of the things at Gauntlet that we look at when setting almost all parameters is liquidity depth and we're almost always

51. 23:40

    looking at that as liquidity depth on a single chain just because we can't really count on uh you know the liquidity on another chain to be available in time for different Atomic transactions that are generally used um in liquidations or Arbitrage so I think as that experience improves and that bridge uh speed comes down and becomes more trusted it also just expands the amount of liquidity that's available and

52. 24:04

    actually makes the user experience for all defi applications a lot smoother for users because you're able to tap into so much more liquidity I guess the the point you're touching upon that you need to see uh liquidity on individual Chains It's like more General kind of trend or concept that like of asynchronicity ac across several chains versus on on unified State machine like is do you think this that's something we need to get used to to work with asynchronous environments yeah I think

53. 24:35

    uh it's inevitable that you know today Unis swap exists on you know multiple different chains and the price that you get to you know swap from token A to B will be different from point you know chain a chain B chain C etc etc and you know the whole idea of flash loans right only exist when you have this kind of synchronous environment where you're able to uh interact with multiple

54. 25:02

    applications within the same transaction but I think you know as you approach this multi-chain thing where you know it takes more than one transactions for an interaction from one chain to be um finalized on another chain uh I think we're kind of going back and saying all right what are some of these multi-application interactions that traditionally have worked in the world where you know defi only existed on just

55. 25:28

    ethereum versus today when the same applications exist on Multi no multiple things right so it definitely raises the complexity of calculations that you have to do kind of risk factors that you have to put into where you know a simple Arbitrage that worked in a synchronous environment may be far more risky in this like asynchronous multi-chain environment and um yeah at the end of

56. 25:52

    the day I don't know if the average user should even know that uh but hopefully we will have kind of you know more expert kind of you know institutions and Enterprise have focused around that and kind of solving that where the user doesn't have to figure that out there is a separate kind of dedicated entity uh figuring out figuring that out in the background I think the other thing with asynchronous environments that we think about you know is like oracles for

57. 26:22

    example oracles are pretty core to a lot of applications we see right now and if the we say like heartbeat of these different chains are kind of at a different pace and one Oracle update goes through before another one that presents potentially you know uh a vector for like an economic attack so that's like another kind of thing to be cognizant of as these you know different ecosystems operate at kind of different speeds is

58. 26:48

    kind of making sure uh that these cross-chain applications are synchronized as well yeah so I guess users can move across Bridges you also already touched upon like having several insensi of the same application across different chain like should dabs build multi-chain also being connected in some way or is it okay to expect from users that they move to the the native chain where a specific dap is based on yeah I think in the future uh so you know

59. 27:21

    there's the whole meme of like fat protocol thesis where the protocol captures all the value I think we're kind of seeing a little bit of a transformation from the fat protocol thesis to like fat application thesis where people are saying hey it's the good apps that capture value eventually I think it's even going to move further away to this like other layer of like fat interface thesis we're already seeing this play out when Unis swap

60. 27:45

    turned on you know taker fees on their front end right like so it's like the order flow that Unis swap gets from app. unis.org is massive and that's where kind of the value capture is so uh eventually I do think that interfaces of applications uh figuring out the multi-chain story faster and better will eventually kind of pay off at the end of the day when the rest of crypto becomes even more intertwined than it is today and yeah and then you know it will

61. 28:17

    definitely go through a cycle of kind of ups and downs right where you know you see an interface that optimizes for you know low fees and speed but then maybe it just blows up when a giant Bridge hack happens so uh you know there's that upcycle of something cheap and fast uh grows really quickly but also just blows up very quickly and we'll just definitely see this kind of cycle where

62. 28:40

    hopefully we'll just find this fairly good equilibrium of you know cost uh ux efficiency speed uh Etc no I I I completely agree I think that um the more and more users come into this space um the likelihood is that a lot of those users probably a majority are much less sophisticated than the users that we have today right the early adopters that are in there that are really excited about this um have a a different approach to using applications than those who follow later

63. 29:18

    who typically are here for a very specific reason that you know does value um and so it's not just about let's build something cool and hey I and I as the early adopter want to take some risk and play with it and see what happens um the later wave of users that we bring into this ecosystem are going to be much more demanding in terms of what they want as a user experience um the safety that they expect um and so being able as

64. 29:46

    you say to build for that mass adoption um and solve those problems in a way that shows real value to those end users it's not just about demonstrating Cool Tech it's about saying hey this is something that is going to going to create real value for you um that I think is is exactly where the value is going to sit yeah and I think right now talking about damps and whether or not they

65. 30:12

    should be built multi-chain I think right now we kind of see this fall into two categories you see you know applications that are deployed isolated on single chains but across multiple so multiple isolated applications on multiple chains or a kind of single application that has built multi-chain um as a feature and I think right now we do see multi-chain as a feature not necessarily something that people assume to be built into applications so right now uh if you're a DAT Builder considering whether or not

66. 30:43

    to build multi-chain I think that's something to kind of be cognizant of is is multi-chain one of the core features of what I am building because I think right now that is how it's perceived I think eventually we will transition away from that where um multi-chain becomes kind of an assumed feature instead of something that is viewed as a feature um but I think as we are right now that's just not necessarily the

67. 31:09

    case so our time is up thanks a lot that was super interesting I guess if anybody from the audience has has any further questions you can find us around at the conference yeah thanks a lot awesome thank you guys thank everyone