Anatoly Reflects on Solana In 2023 & 2024

Fankless Nation, welcome to a conversation with Anatoly Yakovenko. Recently, Solana seems to have turned a page in its evolution with the Jito Airdrop putting $200 million in the hands of over 10,000 different addresses. Seems to have really reawakened a part of Solana as new addresses and new TVL have come online and new conversations are being had in Solana, mainly conversations around Solana governance and Solana economics. And so this has captured the attention of many uh across the crypto industry, and including my own. And so I decided just to throw Anatoly a riverside link where we record podcasts here at Bankless and ask him to come on and just chat about things. This was a pretty unscripted conversation. Usually we have pretty thorough, robust agendas for uh 95% of all bankless podcasts, but this is not one of them. This is just David and Anatoly vibing on podcasts together, talking about Solana, talking about Ethereum, talking about tribal stuff, but not with a tribal tone. So I hope you enjoy that. Before getting to the conversation with Anatoly Yakovanko, first a moment to talk about some of these fantastic sponsors. What's up, Anatoly? How's it going?

It's

it's good man. Good to be here.

So Solana seems to be going well.

Yeah, knock on wood.

Um

it's as surprising to me as to anyone else. Like looking back over the year.

Well, like looking back over the year, I was like, oh man, okay.

This is what this is what it's gonna look like to fail. I was like psychologically preparing myself like at the start of

this year. Like

that things were not gonna work out, but

Why is that?

I mean the the FTX crash

kind of the the sentiment was really really negatively turned

and there was a lot of risk to the kind of

Forgot that that was how this year started.

Yeah yeah uh yeah like and and you know uh

it was it was like kinda

s like one no one like left like

Um, in terms of like internally, all the core engineers were like, okay, whatever, I'm coding. The problems are still like my I still have to finish this my job. So that was good.

And

for the vast majority of the companies in the ecosystem,

you know, they got that like fight or flight response, and most of them chose fight and like just built better products.

Um, but that takes like a while to go from shock to like, okay, people are actually building stuff.

Um

Mm-hmm.

yeah, it was like

Yeah, not gun wood, man. I'm s I don't know. I don't know. I don't know how this happened.

Okay, we we are like um 13 months past the actual you know FTX incident. Call us like 12 months past, you know, being able to actually process what that meant for the crypto industry and especially for Solana, because Solana had to especially process what that would mean for Solana. And like we could we could go through the gamut of the last 12 months and be like, okay, well then there was this phase, and then there was that phase, and then there was this phase, but maybe we could just like compress it all into just like

What is now the net effect of all of that upon the Solana ecosystem? Cause like you said, you have some people who just like doubled down. Some people did leave. Uh some people doubled down. So like if rather than just like going through the whole like speed running of the 2023 history of Solana, just like what's the net effect of it?

The

the doubling down, like it causes like the people with less conviction to leave and people with more conviction to double down. And that is the best thing that could happen to an ecosystem. If you can survive it, what had happened the result was that you had a really core, super connected, strong group of people that had really deep convictions that just built the whole year. They just saw it as an opportunity. Now I have more space, right? Like there's fewer noise, fewer competitors in my product category. Like

It actually is like

turned out to be like a huge win. Like, I don't think Armani would have like did Madlads and built the exchange. I don't think the Tensor guys would have been like, oh, we can beat Magic Eden, even though they have 90% of market share. Right? Like some people just like go.

Hardcore when they see like oh, this biggest competitor is now like spread across five different ecosystems, there's no way they can keep focused. That's like a

a once-in-a-lifetime opportunity for some folks that have that kind of energy. And

um, seeing them rewarded for the work that they put in, I think, is like

the best thing that could happen in the ecosystem because it's really, really rewarding the people that put in the work. Like, that's that's like

the beauty of Bitcoin and proof of work, right? Is that somehow through game theory it anonymously does that and it's magic. And

That like doesn't always work out, you know?

What would you say was um the reason why maybe this answer isn't so like the same for everyone, but um wh why did people stay? What made people stick around Solana versus I mean there's like other high throughput chains that they could have gone to? Like so what about Solana um kept in there?

I think um

the tech is pretty weird. Like it's very different from everyone else. And it has like some unique properties. It obviously is riskier, right? Like you do a bunch of weird optimizations that people think

Look at you crazy when you do them, it takes years for them to like mature and like prove themselves out. And like the folks that are deep in the tech, they kind of get why we made those choices and they appreciated them. And like literally, like the mango guy said, okay, we'd have to like create our own chain, like DYDX. That was that's their alternative. Or we use Solana, and like they felt that

the being part of an ecosystem is better than being kind of running your own L1.

Hmm.

Um, so a lot of people like made the choice, I think, for that reason, for the tech reason. And I think

When you have like a good group of those, like you kind of have a lot of people around them that want to build simply because

um

I don't know if it's validation or like,

you know, like I want to build where a bunch of other smart people build. That's I think largely, you know, one of the best things about Ethereum is you like talk to Dunkrow and you're like,

wow, actually this guy's super smart. How do I like work with him? It's like the best selling point of Ethereum.

Uh, but like we're starting seeing that happen in Solana, and it's not the researchers that I think are like kind of the the cornerstone of Ethereum, it's more like the low-level devs that like kind of can grind really cool implementations and stuff. So

I I think there's something to to be said about that.

One of my favorite questions to ask Bitcoiners is, and they and one of the reasons why is because the answer is always the same, mostly the same, depending on which Bitcoin you're asked. They always kind of more or less say the same answer. But if you ask the Bitcoiners the question, like, what's the most important element of Bitcoin that really like powers the whole system? And like the answer is so incredibly uniform. They're like, well, Bitcoin is really a semblance of many different components and technologies, and it's really about how they all come together to produce Bitcoin. But really, the answer is the difficulty adjustment. Like the they love the difficulty adjustment, and it's like this keystone thing that puts Bitcoin together in a way that the other components are more ancillary. So if I ask you the question like, what is that for Solana? Is that a fair question, or is it just apples to oranges? Because Bitcoin's just so different.

That was a really good question, but it's a really hard one.

Because I don't know.

Mm-hmm.

I don't I don't I don't I don't know if we have like a linch bin like super clever thing.

I think