In it for the tech - How to Choose a Chain | BITKRAFT Summit 2024

welcome everyone thank you for coming along we've got a treat for you today a stacked lineup on this panel we are going to be talking about how to choose a chain um so just to queue up the subject the blockchain space over the past few years has seen a lot of investment at the infrastructure layer which has resulted in a myriad of chains for Builders and Founders to choose from be that alt layer ones layer twos layer 3es monolitic chains modular chains app chains the list goes on this can be a confusing and bit daunting space for even a seasoned we3 professional let alone a new found renter in the space so what we want to do with this panel is just really get down to the Brass tax of what should Founders and Builders be thinking about when choosing a chain uh and we want people to walk away with actionable

and insightful advice so um joining us today on the panel we've got Ryan Wyatt who is a chief growth officer at optimism and Adventure partner for bit craft we have Chris Zoo who is the CEO of Sonic svm a gaming Focus salana Leia 2 and we have Andrew Soro who is VP of sales and business development at immutable my name is Ben I'm moderate and today I'm the web 3 analyst on the crypto team at bigcraft so before we dive into the first questions I'd love for you guys to just spend like one or two minutes to just give a high level overview of what each of your respective companies are building uh Ryan would you like to go up first yeah I work at optimism uh optimism has a L2 but also has a blockchain software stack uh called op stack that some of the large companies like coinbase use for their uh L2 base um you know the goal is by having op stack a lot of these networks can be interoperable one of the big things that we've seen in the industry is fragmentation across blockchains and so op stack aims to alleviate that issue uh

by everyone being on the same shared standard it's a good elevator pitch um awesome so meable uh we started building games about 7 years ago uh today we're the leading web3 gaming platform all-in-one solution ultimately so we have a chain uh built on on polygon so the immutable zkm uh 400 or so games building on the platform and really the objective is how can we simplify the experience for game developers remove all the decision criteria and make it really easy for them to focus on what they ultimately do best which is ship amazing games hi everyone uh I'm Chris zo I'm the co-founder and CEO of Sonic svm Sonic is the first gaming focus svm on top of salana uh and on the back end of that we built our own scaling solution called hyper grid which allows us to issue and launch additional Salon of virtual machines uh focus on different verticals as well as scalability configur configurations uh we started doing this around 3 years ago helping games go to market with web 3 uh and

just land in in salana for its liquidity as well as Community um can share more in the later panels thank you gentlemen so first question I'll throw to you Ryan the fat protocol thesis posits that in blockchain networks Prime uh value primarily ACC crws at the protocol level with generally applications built on top capturing less um as I mentioned like given the proliferation of block space over the past few years coupled with advances in chain abstraction just as the stuff that you're building um with the um shared sequenc layer um this stuff eases the flow of liquidity in users between chains and even allows apps to span multiple chains and ecosystems so my questions are firstly does this thesis need updating um where do you see value acur in this new world and secondly um as block space does become more of a commodity um how can ecosystems such as the ones that you guys represent differentiate themselves to attract and Rain builders

yeah so I mean I think that you know thesis is probably like eight eight years nine years old and it was written around the time when Bitcoin was like a 10 billion doll market cap and you know now we're you it's a trillion plus and look at the overall market cap so in some ways I think it was very accurate um if you look at the top market caps they're all obviously blockchain protocols um and yeah we've been in this infrastructure dilemma for quite some time you know before optimism I was at I was at polygon and you know what we continue to still face all of us do is um it's quite cumbersome you know to to build on chain it's quite cumbersome to uh to deploy to get users users bridging assets is a nightmare I mean we haven't solved some of these like very to a user would be very rudimentary user Journeys that they want to have um and so I think there's a long way to go and this has been kind of you know application developers have really suffered from this because one the space isn't big to begin with then all of a sudden you have to very narrowly scope it to a block blockchain um then deploy that app and

you really are you're in a tough spot because you're kind of beholding to the the users and capital and size of that chain because things like bridging and getting your assets and getting users in is still very difficult now I will say the big change in the last you know 12 months has been it's really cheap and and affordable to spin up a blockchain that's great the problem is it really increases fragmentation because anybody can roll up the chain and so forth and so I think you know what this is kind of why optimism went with with the decision that it went instead of just being the single Standalone L2 offer your stack to people that want to use it um and there is some downside because it is a shared standard so it doesn't afford like a high degree of customization but what will allow for is uh interoperability and more seamless interoperability where people don't realize what chain they're on and I think there's value long term in that for both the user and the application developer to really abstract away like the underlying blockchain like if you go play Call of Duty you don't

give a [ __ ] in the multiplayer experience if it's AWS or Cloud it's like that's not what the discussion is and so I ultimately think we need to get to that place for application developers to start to thrive and them get their piece of the pie they will inevitably um there just really hasn't been any successful apps on blockchain other than you know poly Market you know and the game side axi Infinity early on and I think a lot of that is not for a lack of effort or really good ideas or great Founders or or great startups I think it was you know a lot of these companies were stuck in in uh lackluster infrastructure which is changing and it's changing rapidly and you look at like a mutable you know they're they're working to like make it really easy and slus for game developers to deploy you know if you look at Bas Bas is increasing gas Target limits to basically reduce these transaction costs so wallets are now starting to span across many chains so I I think this is going to be a better experience and I do think longterm applications will get to capture more value than they've been able to up until this point I think it's it's going to take a little bit of time

though okay thank you Andrew do you want to add something yeah I mean the only thing that I would add I think was maybe the the second half of your question just around like what specifically value will AC crew like gaming everyone in this room knows um content gaming is very power law driven and so therefore you know when you think of some something like an immutable for example obviously Sonic as well like very very specific to the space like to Ryan's Point yes there's the ability for you know we'll have the generalized infrastructure layer but I do think that ecosystems like imut for example will like will conform to power law there will be winners right people in specifically game devs like there's a very specific set of requirements and needs that they have right that is maybe not best served all the time by generalized infrastructure and so I think there will be winners on the one level above the infrastructure layer um just to kind of answer that last Point around like hey where do you think that the value will ACR obviously there still is a massive win for the infrastructure layer that it's being built on so I think that's kind of how we think about those things and it's obviously a really big reason why we set up the immutable

business to to to be what it is sounds great thank you and uh Chris anything you would like to add there yeah so uh when we think about value C we also think about it from the game studi perspective uh from a from an industry perspective we think that we're in the very early Innings when it comes to revenue diversification um and how game studios or content businesses think about crypto um monetization so um if we break down you know gaming types every single different types of game actually have a different Revenue stream um so to speak and we think that that's similar in in crypto as well and I was talking to Andrew about this where you know if we're focusing on you know nft marketplaces revenue streams if you're focusing on defi staking yields uh on top of salana where we built there is a very large Focus for the defi community and Dent community and that leads us to really think about the diversification of re revenue streams as well when we build a chain so from a chain level can you enshrine these protocols within the chain where you know you're tapping to

the liquidity of base layer of salana validator staked weight and then building on top of you know the game maybe a reaking mechanism that actually allows the game to generate yield off of the Stak salana on the base layer and ta into that natively um and and we think that as the chain or the gaming environment ourselves our value of cow has to align with the gaming Studios so if the game is a MMO RPG that has a significant traffic volume as well as velocity of money moving between these transactions then maybe we should just have a share on top of the token swap fees um but if the games have you know Cosmetics or Collectibles as the base layer of their revenue generation then we should share that as a ecosystem of that Marketplace fees as well so we think about our chain itself as a ecosystem um that serve the game the best uh and then diversify those revenue streams with the games um so we think value accural happens only when you align with apps that are building on top

of got it yeah and that makes a lot of sense I think now would probably be a good opportunity actually I mean I think a lot of people here will be familiar with what optimism are doing and what a mutable building as a newer entrance to the space would you like to just um maybe go a little bit deeper into like why does sal itself need a game in layer to yeah so you know when we started building um building Goen Market strategies as well as launching assets for games three years ago um there wasn't very mature you know layer two solutions or uh very lit high high performance parallel execution environments so we actually got a look at all of these environments you know getting offers from starkware polygon uh getting offers from salana at the same time and what we realize is that there is a strong Focus within the salana ecosystem when it comes to user experience usability as well as uh just being cheap and we thought that that was actually a really strong Advantage when it comes to um the builders on top of the ecosystem so Sonic when we started

building this svm environment it was to solve three major problems for salana specifically the first one is that it is very very difficult for digital assets to launch on top of salana uh there's no publishing infrastructure there are no teams like immutable helping games go to market if you look at all of the chains um you know within the evm ecosystem that are building for gaming specifically you have immutable BX you know uh ancient eight such and so forth all the all of those together adds up to 10 of 20s of billion um dollar market caps or ftvs uh on salana the whole gaming ecosystem their market cap added up together is less than you know a fraction of those total numbers I don't have the exact numbers now um so when that you know that numberb is being compared we think that uh when you have a upand coming ecosystem like salana the liquidity is rising so rapidly uh the gaming Studios would naturally want to migrate or you know think about an ecosystem that they can launch with with such high growth of liquidity the second

problem is that it is very difficult for for each individual game to avoid hos spots on salana or on ethereum as well so on ethereum you actually have doesn't have local fee markets like salana where one game fee uh spikes will not affect the other gam uh fee spikes but on um salana there's congestion issues that happen in March or April so we're here to you know self that as well and then the third is just how do you support games as a whole ecosystem of tools giving gaming specific dexes gaming specific marketplaces all of the matching infrastructure um and that's what you know Sonic enshrines into its protocol so that on a contract level when you sign with a chain you think about you know the revenue shares with that chain already um so those three problems are you know what Sonic basically offers to solve thank you very much so Andrew I'd like to direct the next one to you and then I'd love to hear the other two um chip in as well but the um the evm clearly has Network

effects today um around developers tooling infrastructure how should Founders think about um VM diversity in the future like there's obviously like up you know other VMS are again inaction now most notably the sbm and then there's move VM as well um do you think that in the future we will see developer mind share split evenly across different VMS or do you think there will be a power LW type distribution ution I'd love to hear your thoughts then then Chris I'd love you I'd love to hear your thoughts as well as someone who's building in the sbm space yeah good question um I think like maybe starting at the back end like I think yes it might start with with power Lop but I think at the end of the day like very very similarly to like I don't know when you're playing Call of Duty I don't know if you're super worried if it's like uh Google uh you know hosting it or Amazon on the back end like ultimately I think for developers when we speak to developers the single biggest thing is is like Hey try and understand their objectives and what ecosystem today and

I think it's pretty clear um pretty early on in the space and obviously a lot of Builders here and you know other than axi like we haven't had that like that really another hit that truly is very undeniable and we can then go and say hey look like these web 2 studios are coming into the space and so I think it's really about like what are the specific challenges and problems that these developers are running into and so how does the ecosystem help them support that so on the immutable side like there's a couple different things of course passport that's our our wallet product which is you know kind of visible transactions really easy signin um and then there's a ton of like Services right so we started by building games we understand some of the challenges that people run into and so at the end of the day it's like hey how do you get a token to Market how do you think about to economics how do you think about the economy and so I think it's really about choosing the developer or sorry rather the platform and the ecosystem that you think is really going to help you achieve your objectives and then I think at the end of the day like we're not Zero Sum we like to be positive some I think a win for immutable is a win for everyone and I think a win for Sonic or an optimism is a win for everyone as well so um if

there's a huge win elsewhere I think Rising Tides lift all boats we're obviously all in on evm you know like we really do want to be extension of ethereum like not be shy about it much like you know Sonic would be about salana um I think move is really interesting from a language but if you just like look from a game developer perspective um you it's already so hard to make a game like you just start with that forget if it's a blockchain game like [ __ ] it it's just hard to make a game that's really expensive you have to then have a go to market strategy that attracts users you need those users to play that game you need those users to stay in the game come back and retain so then like you're like okay that's already hard I got to go do that now I'm going to go do it in the blockchain world I have to pick one of these protocols that I want to deploy from and so you are really like handcuffed when you start to move outside of evm on that decision that you're making there which could be good or bad you might get a big Grant to do it but you're handcuffed whether it works or not you are long term maybe that's not the case but right now I just personally would air on the side

of like where is their composability where can you head your bets a little bit uh you know if a chain didn't work for you what would the migration look like to be to on another chain you know it's like oh I launched on you know this specific chain at least it's evm I can be able to migrate to base really easily if that's something that makes sense for me because they're you know they're they're leading or they're doing marketing for us so I that's the the tough part that I see right now like you really it takes so much to build these ecosystems up and um when I look at the space I look at like ethereum and salana are the only two that have like done that where they can stand very confidently in their ecosystems and say there's Capital here there's real users here there's real developer enthusiasm here um it's just really hard for me to move outside of those two ecosystems like I'm bullish as hell on both of them um it just not that I'm not like excited and eager on some of those it's just they they are they're later to the entrance it's going to take more time for these to to develop community and develop users and you know build that kind of foundation that makes developers

confident to deploy and really in the inter room it's just going to be developers that are going to get huge grants to deploy there to subsidize the risk by deploying there and that's okay like that's how you start like that's what you know that's what I would do if I was leading like something on the Move side um that's the right strategy um you just puts yourself in a precarious situation in an environment that's already difficult to to thrive in Chris what would your response be there I think it's very comforting to hear you know the Optimus Foundation be bullish on salana as well um so if you look at top three or top five tokens right you have uscc and usdt you take those away you have you know ethereum salana and then obviously Bitcoin on top of charts so I think the asset allocation when it comes to liquidity perspective it's already figured in into that small subset um ton obviously is a different particular uh use case but um a little bit off of the topic here um now that we've established ethereum salana being you know top of choice there we actually think that VM um

differences actually don't matter as much we just look at one where are the retail users and two what are the support pillars for games um and then obviously three how much liquidity you have as a total pool so that the users actually have access to to those liquidity um and when we look at retail users obviously evm all combined together is uh is a huge ecosystem um I think salana is a little bit different where because of the emphasis on use case um ethereum almost as a nation state or you know a network State um actually had had multiple l2s or multiple segregation of these um rollups first and then they cared about use case afterwards whereas salana started with use case so that every single one of these rollups or network extensions now that we call them um actually starts off with a validated use case so you make sure that each one of those Network extensions actually are proliferated with users first and foremost um and that's why the foundation has been so dis L of foundation has been so carefully selecting the um Network

extensions that they you know push for and allow and gaming is obviously one big part of that um and now that we look at liquidity um I think that's something that's already been validated with the the um the current market sentiment around salana and then the third is that uh we think that VM itself actually doesn't matter as much because um really at the end of the day there's a clear Trend towards block space being commoditized meaning that your gas fees are going to go lower your Chain's going to go faster and all of the new chains they all have this you know um same sentiment right whether it be building Mega eth on top of ethereum building molot uh on the side and then you all have the similar structure where you're konez block space and if you even consider gas fee as a revenue stream I think it's ultimately at the end of the day not so wise uh optimism has an amazing business model with sequencer over you know overestimating the fees so you can always generate um Revenue off of those when you decentralize that um I I I don't know but uh I think that's

such an amazing and elegant business model there um and then the last is like what are the differences between the VMS we actually think that market um or the the token price actions is something that make or break a ecosystem and really if you think about all of the existing tokens out there that have gone through a tral to top and then back to tral um ethereum and salana are the only two with Salas being you know 0.2 to 260 and then back to 8 and then now 150 um that is the biggest kind of uh fluctuation you can hand make um with someone you taking the fall for it so we think that um as a developers Al also think about the community reaction to those type of fluctuations of uh volatility and it's very rare to have one at that massive scale um so I think the new ones are really you can probably get squeeze out like one or two million or three million of Grants um but it's that enough for you to make a world changing game and I I think that's not anything either of you two would like to add that or no I mean I not really I agree I

think like block space is totally getting commoditized I mean we're working we our team actually worked on 4844 and some of the things with blobs and we're increasing gas targets and limits on Bas like we really want to drive these transaction cost down too so I think that's right I agree on you know directionally where things are going in the space maybe like just to be tiny bit contrarian it wouldn't be a panel without that uh like I think do it I think for like it for the game developer like sometimes also just depends on like what's your what's your project like what what are you trying to achieve so Chris and I were talking about this earlier today actually like I think what they are set up to do very well and very elegantly is like right now on salana there's obviously like salana is unabashedly very much like hey there's a very giant Casino retail element to that right and the community really leans into that so if your game is really going to try to take advantage of that and Bas is actually another another great example of that so like sure like at the end of the day like VMS obviously choose you know some of the leading ones and don't go for like number three four

five that maybe won't be around but I think you know what are you trying to achieve what are you trying to tap into de gen liquidity or you're trying to tap into like meme coins I think there's a very clear choice for where to deploy based off of that some of the some of the projects that immutable speaks to you know if you think of like how crypto Ed more around ownership hey we're going to get them in with a bit of a gameplay Loop and then oh by the way you know kind of D1 D3 whenever it is passport flashes up they don't even know that they kind of provisioned a wallet and then it's kind of ownership and and so just kind of different rails I think it is a little bit project dependent and so that's probably where I'd be like hey like really have a think about what the project is specifically trying to achieve and those are some of the conversations that we have with developers maybe not super contrarian now that I said that so just build on the super chain buildt on base okay okay so I guess um web three game developers today or web three developers in general as a percentage of total developers in the world is obviously very small today um clearly to grow the space we need to

bring more web2 developers into the fre um what do you guys think are the biggest hurdles and Ryan looks like he needs he disagrees so I'd love to hear his thoughts so um yeah like what do you see the biggest hurdles are today um in transitioning Web Two developers into the web 3 space and what can ecosystems like yourselves help I I actually don't know that I subscribe to the idea of like bringing web develop Web Two developers and web 3 at all to be honest with you not that you can't um I'm I'm just like not super hopeful about it I think um you know ultimately when when I spend a lot of time talking to web to developers and you ask them like well why do you want to build on chain they have like really shitty or non-existent answers and like right there is like a good reason of why you shouldn't do it right um I think if blockchain games web 3 games crypto games whatever the [ __ ] you want to call them you really have to come at it with like a whole different perspective in why you're doing it what's the rationale and like the games that are going to inevitably and they will break through I know we haven't really had any breakthrough games I do fully believe we will I am like 100%

certain they're not going to come from web 2 native developers unless they have like completely been redpilled and they you know they have thought about this differently like form fitting a web 2 game and be like oh you want to put like your digital assets or like your you know digital items on chain that's like so cool why like there's so many ways you can do that today um so there's got to be something more there there's got to be something bigger and so I think it's going to come from like the native web 3 cohort and that's where they will they might create inspiration for web 2 developers inevitably like I think about you know mobile games and how that really broke you know a lot of stigma around the the genre and category free to play coming from Asia of the West with like Riot League of Legends like there are people that hate these models and then adopt them I think that could happen long term with like web 2 developers where they start to incorporate it but that first inflection point the first people through the wall are going to be native web 3 developers maybe I I agree with you mostly uh and I think like just actually one of the things that immutable is doing strategy wise I agree with you

prob like 75% I don't think that the like Innovation like really an indev and I truly believe this is going to have obviously so much more license and creativity to just really kind of push the boundaries and experiment and that's where a lot the incumbents usually aren't the ones that are pushing I do I I do think though there is something to be said about um so ad immutable one of the things that we're doing is we're actually going and very programmatically approaching specific web 2 and I I don't like using web 2 web 3 we're using approaching very large gaming businesses taking a look at their catalog but those businesses already have to have someone to ran point that is redpilled and is willing to stand up in the organization and go hey I've already wanted to do this but they might need the extra nudge they might need a partner to help them kind of uh go on that journey and you know then there's probably other different you know support that they would ultimately need and so one of the things that we're doing is we're being very very selective about who we're going to um we're going to have a couple announcements coming up shortly just partnering with large Studios because I

do think like while maybe some of the Innovation and the moonshots aren't going to come I do think that there is something really valuable about having those like Lighthouse Beacon developers that are building in the space but it has to be credibly it can't just be like hey here you go here's like a web 2 game we're just going to slap this on um it's got to be very thoughtful and it has to be led by someone within the organization that is thinking completely differently and has the license to be to to basically think completely differently so SL slightly different take work to The Gamers of like that IP that's the other thing too it's like you know Thea's and those type have like cultivated and they are all like very anti loot anti- nft anti- onchain already and so that's why it's like you need this group of users and developers that [ __ ] live and breed This and like totally get it and even if that's small it's like build that but I I would love to be wrong it'd be sick it would accelerate it would accelerate like G you know adoption of web three games if this did happen and I was wrong yeah so on that point I actually think immutable has a couple of games that you know we personally

really like space Nation for example um MMO RPG great you know web 2 Studio One of the legendary producers across the board um coming into web3 and actually brought a lot of the old EV on Lion users with them with their Guild model uh and the onchain economy as well um so I think they uh the question that we always ask is like do you love The Meta game um to the producer as well as the retail users do you like the trading aspect of all of you know onchain economy and actually having an open system where you can market and trade all these assets and for space Nation for example I think the answer was like a clear yes obviously we also want to get them on salana as well eventually but um and once you have that like the Love of the metag Game then you can um actually think that having a web 2 experience of building games is such a big plus um you know fast forwards it yeah like we have CCP uh that's in the optimism ecosystem right e Frontier which is on Redstone which is a op stack chain um that's a great example of like

web 2 developers that went like full in red pill and then used all that expertise and like [ __ ] crushed it right so they're there but like you need that right but that's my point it's very rare and like this is not like a spray and prey approach it will not be successful if you go to web two businesses and say take game and like just let's slap on blockchain like I think that's 1.0 vintage of of what has been tried in the space so I think yeah you have to be like really really selective about it yep just trade first excellent cool thank you thank you maybe um if there's any burning questions we can have we have time for like maybe one question if not we'll call it a day question so you just had a really good discussion about s of the highend AAA traditional game developers but if you're taking more of the web fre native approach how would you go about um reaching out grass that might be more open to building on any from like a developers perspective I guess guys are as are people

are does that yeah I mean you two would probably be better off to answer like on the optimism side we're we're focused on on chains like deploying chains so like we're spending time with a lot of the big organizations that want their own blockchains but uh we have a a large grant program that has it's called retr funding is 800 million op tokens and any chain that's built on op stack can pull from that so I don't know as like a developer I look at like where are you going to get the kind of go to market where are you going to get funding support as still very critical like um I I think that's an important part but yeah you guys might be better off on the individual Ryan master of chains has change yes uh yeah yeah so I think I think at amable we made a decision really early on so like of course like so I on the BD team I was the first commercial hire three and a half years ago um it was very clear yes we had some inbound that was also at the the peak of the the peak of peak like this was right

after NBA top shots and then the inbound dried up and it was like very very C and there's there's actually only so many uh devs that are red pilled and are building in web 3 and so for us it was very clear that we actually had to build like a very uh programmatic thoughtful uh kind of go to market engine and so like my BD team is everywhere like I'm based in Sydney no one is in Sydney my my team is where customers are um so one like we're just like have the conversations like stay in touch like a game developers obviously there's such a long lead cycle and we Ty Al find about 6 months before launch is like when it starts to get critical we actually would like to engage much more earlier and have you think about you know specifically what the stack is going to look like but 6 months is the critical uh the critical part but yeah like I like I don't think it's rocket science I do think that there's plenty of examples of BD in the space and just like Hey we're going to like go do announcements pump token whatever like for us it's very much about like what are you building like how how can we sit along side you like understand your challenges problems and how does a mutable solve that with both tech services ecosystem Etc I mean BD 101 uh we think that a mix

of both um is super interesting where there is we have a BD team that actually targets the specific catalog of games that we want to talk to kind of creating a catalog of you know uh initially maybe we wanted more DJ focused prediction markets and then later on U volume based defi games so we have you know uh targets every week on a review session on the other hand there are the Grassroots developers that you're talking about so I see the dojo shirt there um but mod and dojo documentation structure it was actually something that we looked at early on to have that uh you know super easy to use and have that user experience or developer experience super easy and I think Solana's super team is a really interesting structure where they decentralize the uh Community op operations Community where they pick a localized um operational manager for each one of these countries that I want to spend up a super team that's already a holder of their token so in this case um you know a stark Stark token could be interesting and then they select that person and run that let that person run

the entire nation's um operations and then they give Grant based on what they call Nation GDP so basically the total amount of money generated from uh Vietnam or France or you know whatever uh place that super team is Spa out and then uh they gauge the metrics of these individual places by the number of submissions of hackathons so now you have a documentation you have grand structure all based on number of submissions for hackathons and you have Grassroots developers and mud I think or lce did a really interesting thing where they just got the best developers um CCP for example write essays and that's like a that's a thing that's low touch for these developers just write an essay put up a booklet called autonomous World research and then um you have a entire group of people that are super interested in this ideology and I thought that was really cool as well well thank you very much Jens it's been a good one thank you [Applause] everyone for