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TBW Premium #15: At the heart of EthCC in Paris
Read all about The Big Whale's 15th Premium newsletter.
Hello Whales and welcome to the little newcomers who've just joined us in the Premium edition!
For this week, we've prepared a special feature for you with 3 issues sent out during the time of EthCC (the big Ethereum conference), which is taking place in Paris until Friday.
Here's the 1st edition.
THE BIG SPLASH
What bear market?
Yesterday morning, you had to arrive early at the Mutualité, and not just to avoid the sweltering Paris heat 🥵. From 9am onwards, there were plenty of people there for the 1st day of the EthCC, which this week brings together some of the world's crypto elite. And aside from the turnout (over 1,000 people on Tuesday alone), it was the atmosphere that was impressive. Listening to most of the participants, you'd almost think the markets were at their peak. "Prices don't matter," one project manager slipped us.
Certainly, an event like EthCC is mainly attended by industry professionals. But such an atmosphere aptly describes what's happening in the Web3 ecosystem. Prizes are no longer as decisive as they used to be, and most of the attention is focused on... projects. And there are plenty of them to be seen at EthCC.
This year, one of the main themes concerns Layers 2, the projects that rely on Ethereum (Layer 1) to multiply the number of transactions and drive down the cost of transactions (a recurring problem on Ethereum). We met several of them, including the Israeli company StarkWare, which is considered by many to be one of the most promising projects. You can find an interview below!
THE BIG NEWS
Our exclusive news
👉 The runaway success of CarbonABLE
We know about NFTs linked to art, gaming and finance, but much less about those linked to ecology. And yet some projects are emerging in this niche! One of the most advanced is France's CarbonABLE. Founded just a few months ago, this start-up uses NFTs to help combat global warming. How does it do this? By financing reforestation and replanting projects through the sale of its NFTs. In return, investors receive income from the carbon credits generated by the projects financed, as well as governance tokens for the platform, the CARBZ. In just a few weeks, CarbonABLE has financed several projects. A sign of the success of these operations is that, according to our information, the start-up is in the process of raising funds.
👉 The SandBox raises $150 million
The deal had been in the pipeline for a few months already, but is now complete: the French-born metaverse The SandBox has just raised $150 million on a valuation of just under $2 billion. The deal took some time to complete, not least because of market conditions. The fall in share prices since April has made some investors more cautious. In the spring, negotiations centred on about $400 million. Some were even talking about $500 million. "The conditions have totally changed in the space of a few weeks", explain several sources familiar with the deal. With these funds, The SandBox, which is multiplying its partnerships like the latest one with skateboarder Tony Hawk, wants to continue to develop. Particularly in Europe.
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THE BIG STORY
Eli Ben-Sasson (StarkWare): "Energy sobriety has become a key issue" 🍃
👉 News. StarkWare has announced the launch of its token.
👉 The background. The Israeli start-up is on everyone's lips and experts are raving about the capabilities of this Ethereum Layer 2.
👉 Why it matters. With the move to Proof-of-Stake, Ethereum is set to become more energy-efficient. With the development of Layers 2, this could cause its use to explode.
THE BIG WHALE: This is the third time you've come to Paris for EthCC. What do you think of the French ecosystem, how has it evolved?
ELI BEN-SASSON: Honestly, I think it's really impressive. It's clearly one of the most dynamic on the planet and it's no coincidence that there are so many people in Paris for this event. We came with more than 20 people from StarkWare to find out about other projects, particularly French ones, and also to see what's new in the Ethereum ecosystem.
Actually, Ethereum is preparing to move away from Proof-of-Work to Proof-of-Stake, which is more energy-efficient. What do you think of this change?
Energy efficiency has become an essential issue that no one can avoid any longer. Just look at the weather outside! We need blockchains that consume less energy, and Proof-of-Stake (PoS) should help us achieve this. I know there's a debate about the security of PoS, but you know, if Proof-of-Work (used by Bitcoin and Ethereum until now, editor's note) had been presented several years ago to academic leaders, they would all have been unanimous in saying that it's not a sufficiently 'secure' system, so I'd be wary of being peremptory about the security of Proof-of-Stake. We've done a lot of research into how PoS works, and identified some potential weaknesses. But the real question is how it will work after implementation. And nobody can really predict that...
Didn't the successive postponements of the update affect confidence?
The switch to PoS is a huge undertaking, so that's to be expected. It's very difficult to update a system like Ethereum because the protocol hosts so much value and so many users. It's not as if we're starting from scratch. I'm sure that the Ethereum developers, who are among the best in the world, know what they're doing.
What are the main services developed by StarkWare?
We have two main ones. On the one hand, StarkEx, which is a solution that can be adapted for each of our customers and enables projects such as Immutable or Sorare to increase the number of transactions managed without driving up their running costs. On the other hand, we're currently developing StarkNet, which is similar to Ethereum in the way it works: it's a permission-free network on which anyone can develop and build decentralised applications. StarkNet is currently in alpha phase, which means that only a small handful of developers have access to it.
You recently confirmed the launch of your token, but why do you need a native token when your function is to improve Ethereum's scalability? Couldn't you just use ETH?
An ecosystem needs a token to federate its community, and it needs to be independent of third parties to function properly. I'll take a very simple example: let's imagine we want to update our system. Who should have the power to express their opinion on this change? Our community or another ecosystem? The answer is obvious: the StarkNet community. This community is defined by the token holders. And using a token that we don't directly control would make us too dependent on the choices made by other projects. Finally, having a native token means we can reward community members who improve the ecosystem. For these three reasons, we believe that the creation of a token is justified and that the community appreciates this choice.
StarkWare has raised a lot of money in recent months, with the company now valued at $8 billion. Are you planning an IPO any time soon?
That's not on the cards yet (laughs). We have other priorities before going public. So far, Starkware has had no problem raising finance. When we did, the market was doing very well, but the macro-economic environment has recently deteriorated. So it's not ideal for raising new funds, but that's not a problem because we don't need them at least immediately.
Do you think 2022 will see Ethereum's Layer 2 protocols take off?
Yes, I hope so. But if it takes a little longer and adoption happens in 2023, it's not a big deal. In any case, it's imminent. We'll be there before 2024.
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