Announcing Unichain | DeFi's Next Frontier?

Welcome to Bankless, where today we got a special announcement for you. The Unichain. This is Uniswap's chain. This was predicted for a very long time, and now it's coming to pass. We've got Hayden Adams from Uniswap, the founder of Uniswap. We also have Carl Floorsch. He is a co founder of Optimism, which maybe gives you a sense for what layer two they're going to launch on. Smash them.

Yeah, you get a unicorn looking chain. And so uh they are here to announce this and talk about it today. Uh we get into the details. We also have some kind of like uh questions or or pushback, right? Some some current discussions in the Ethereum world of what do we do? Another chain, does this result in more fragmentation? How is this good for ether the asset? Where should DeFi live? Should it lay live on layer twos or or layer ones? Anyway, uh Hayden and Carl give the context for that, what they're planning with this Unit Chain uh project, and uh answers to many of those questions.

I think this is gonna start off a very big conversation in the Ethereum space because this this is not just you know another generalized layer two. Uh this is not another optimism, another base, another arbitrum. This is an application getting a chain. And so you gotta tip your hat to the Cosmos people who always predicted that apps will one day become chains. Uh and uh because and the biggest app, what is the biggest app on Ethereum? It's Uniswap. So of course, it's going to be the first one to get its own chain, but this is going to start a trend because the Unichain is going to push the frontier on some very hard problems in the Ethereum space: chain interoperability, chain abstraction, uh, you know, bridging without having to impose that choice upon users. This they are going to put a lot of you know research and investment and energy into abstracting the chains, carving a path for the next biggest app to follow suit. And then it will get its own app chain. And so I think this is uh kind of gonna be a kind of a landmark moment in the Ethereum roll-up centric roadmap when the largest app on the layer one gets becomes a very prominent chain inside of the super chain. Huge win for Optimism. Uh, an inevitable conclusion by Uniswap, predicted by many. Uh, many have always said that apps will always uh be incented to get its own chain. Dana Litzer, shout out to Dana Litzer to put who put the first formal words of Uniswap.

Yeah.

The blog post said Unichain is inevitable and and here that that day is finally here. Uh very big moment uh for both these teams, but also I think for the the greater Ethereum ecosystem as a whole.

Yeah, I think so. And I also think in the aftermath of this it's gonna cause further discussion from those in the Ethereum community who are like, wait a second, we still want some of the DeFi apps and liquidity on layer one. And how's this gonna work if all of the liquidity goes into layer two? So

Push it all to the layer twos. If everything goes to the layer twos and they are also perfectly abstracted,

then everything is

it's just one.

one massive network.

See, these are the types of conversations uh that are going on. And uh, well, we won't spoil uh Hayden and Carl's take on it. It's a little bit of the best way out is through, but we'll get to that episode. Before we do, we want to thank the the sponsors that made this episode possible.

Bankless Nation, I'm here with Carl Floorsch, the chief optimist over at OP Labs, and also Hayden Adams, the chief unicorn officer over at Uniswap Labs. Carl and Hayden, welcome back to Bankless.

Thank you very much.

So uh why are the creators of one, the OP stack framework and two, the Uniswap AMM on the same podcast? What are you guys doing here?

Uh you know, just hanging out. Um yeah, I mean look, obviously there's been a long a lot of speculation about whether or not Uniswap eventually should have its own chain, and that's really what we're here to talk about and announce that and um, you know, just talk about how it fits into our products and roadmaps and like Ethereum's scaling future.

Okay, so dropping the UniChain, I think, uh is a pretty big cannonball into the into the lake of Ethereum. Uh Carl, can you talk about just like the significance of this? Like what does this mean for the Ethereum roll up landscape? What does this mean for optimism? What does it mean? Like, what's your perspective here with just the impact here?

I think this is a major step towards maturing and realizing the Ethereum scalability vision. I think it's been a long time coming that Uniswap would eventually have a chain just for its scalability purposes. And it's super exciting that it's going to be, you know, joining the ranks of other L2s within the super chain. And, you know, now, uh more than ever, it's going to be important that we solve, you know, fragmentation and interoperability. But, you know, that's on us. We're we're working on it.

Uh Hayden, uh maybe you could talk about what does a unichain actually look like? Uh why does Uniswap need a chain? We have we have a Uniswap. We have many Uniswaps and many different chains. Why are we creating a uni chain?

Yeah, so I I think it has to start with like how blockchains are going to scale generally and like then also how we approach building products and building protocols. And uh Unichain is really just like the chain that we want to see in the world, uh, particularly the L2, and one that's really built for Uniswap users and uh, you know, the needs of you know DeFi and the needs of you know the L2 ecosystem. And you know, the way that I think about it is that

uh we are on you know, Ethereum for, you know, there's all this like debate about where should DeFi live, should it be L1 or L2? There's that whole like can of worms on Twitter right now, and there's also um just this concept of the roll up centric roadmap, uh, which is basically that like today, Ethereum is being designed and built uh with

You know, essentially a layer two scaling uh vision in mind. Um, and

we at Uniswap tend to be you know very practical and very focused on our users, which is like, how do we within that world create the best user outcomes? Um, how do we kind of like accelerate this vision for scaling blockchains, which we think is uh really exciting? And people talk about blockchain scaling. I think the really like I like just like reducing things down for myself. And it's like blockchains are kind of like servers with cool properties. Um, right? If you need your server to never go offline, uh if you need your server, uh you might want to use one of these fancy blockchain servers that add on you know decentralization, if you want your server to not have operators that are stealing your money, et cetera. Um

And so when you think about how servers scale, how do you scale servers? Do you just have more of them or beefier servers? And that's kind of what like the L2 vision is, is that we have like more chains and beefier chains. And uh the thing that the the challenges that we face in that world is um

You know, like whenever when we were running every application on Ethereum on a single server on the L1 mainnet, um, and again, it's not a this decentralized cool blockchain server. I'm not saying it's just a server, but when you run it all on that, you've got these really nice properties. Um, because everything can communicate, like your balances are the same across every application. Your the user experience of moving between applications is very seamless because it's all running in the same environment. Um and so we were able to create these like very high quality user experiences. You know, people don't want to think about managing their assets across multiple networks. Users don't even want to think about pretty much anything. Uh users just want to like have an action they want to perform, and they want that to be as simple as humanly possible. Um and then when you

Look at what has happened as we start to scale into many L2s. You get this world where there's like, okay, we're scaling by parallel like by paralyzing and by creating more of these things, but liquidity and user experience and interacting between the different systems is getting more and more complex. And today that is being put on users, on end users. And what we are aiming with UniChain is how do we create systems where you get the you know.

Some of the user experience benefits we had when everything ran on one chain. Um, how do we kind of create this like seamless uh you user experience, whatever chain you're on? Um, but then also and and how and how do we reduce some of the fragmentation of liquidity, the fragmentation of user experience that's happening? Um, and how do we kind of just like and then

With this opportunity, you know, part of the benefit of scaling and moving to layer twos is there are also benefits. So how can we like use the unique uh you know benefits and landscape of layer two to further improve on that user experience beyond what we were ever able to do on L1, even when everything was running in the same place, to create like a very fast, very cheap, um, but still you know decentralized, still you know, uh like

uh having good trust properties uh version of Uniswap. Um so it's it's kind of aiming to be this like L2 kind of liquidity hub uh that is designed to have the properties that are most useful for DeFi um and and could be really like a home for for for DeFi and uh and uh you know, yeah.

Home for DeFi, L2 liquidity hub. Hayden, I just have a a bunch of rapid fire just general questions. So this thing is called uh the unit. When is it launching?

But um

it's uh yeah, what is this launching? It's actually launching very, very soon. I think that, you know, you it's basically with with this announcement, um uh it's gonna

uh we're gonna have a test net out

Okay.

uh you know right away, and then uh it will be launching um, you know, uh imminently very soon uh this year. Um

Okay, and then so we have an uh congrats on that. We have an uh uh optimism, an OP chain basically. So this implies kind of like EVM running on the OP stack, that sort of thing. And is this is the plan to like take Uniswap the protocol uh and deploy it on this chain? Or are we like for are we migrating anything from the existing uh, you know, the home for Uniswap is sort of on the Ethereum L1. Will Ethereum remain the L1 remain the home of Uniswap? And like what what what will actually be Uniswap about uh the Unichain? And will it also be a home to other DeFi apps? Like so when we think about a DeFi chain, L2 chain, we're s we sort of think of something like um optimism itself or something like base, let's say, or something like Arbitrum. And it's kind of general purpose across all sorts of different DeFi. Is it like that? G give us some more color here.

Yeah, of course. Let's let's just go through it all. And I can even start to talk about some of like the tech technical changes and improvements or enhancements that we've been thinking about for our specific version. Look, at its core, it's it's funny when you talk about like even optimizing for a specific use case. You still generally end up wanting to support the general class of use cases. Uh right. So it is a you know, like base, like optimism. It is a you know general purpose roll-up. Um but uh we've you know uh parameterized it and kind of uh you know built systems around it that are really optimized for DeFi and for uh you know uh things that we've learned uh in in in you know in the course of developing Uniswap as well as our products um that are built around Uniswap. Um and so it's really like you know it designed for DeFi in mind and designed for like the specific needs and use cases, uh, but it's um

you know, i i it's still like a general purpose roll-up. Um and and can have all sorts of applications built on top of it. Um I I will s I'll say that like one thing when you comp kind of compare like what is mainnet's role and how does this fit next to mainnet.

Um, I'll say that like the the world of like mainnet being the central hub.

And by May Net, you mean the L1, yes.

Sorry, Ethereum L1, Ethereum Mainnet being this like sort of a starting point that people onboard, like right now what we have, and it's actually one of the core reasons that everything feels so broken, and I can come back to that.

Uh Ethereum is being built in it's and I think it's a I actually think Ethereum's roadmap is like pretty good. Um

The Ethereum is being built

entirely with the in the mind, you know, with the mind of like L2, like an L2-centric vision, where most people, where most users, most applications are living on L2 and they're ultimately like settling on, and you have proving systems on L1, and you have data availability on L1, and it's like ultimately settling there. But like the, you know, when you talk about like what users actually need, they need like something that's like much lower. Like Ethereum's optimizing for this like very extreme level of decentralization and censorship resistance, which is like suitable for like being this like world settlement layer. And I think there's like a lot of value to that. Um but like when it comes to like your average user, they need transactions to happen. Even like a second is too slow, right? You need like subs, you need like millisecond kind of not one millisecond, but you need like very fast blocks, right? And so we're aiming for uh 200 to 250 millisecond blocks. And we can come back to how we're aiming to accomplish that. But

That sounds like NASDAQ on chain, Hayden.

But

No, I I think that like it's it's still like you know using this like decentralized blockchain technology to do very cool decentralized things that Nasdaq would never never dream of. Um but um and I also think it's still like ch you know a general purpose thing. People can build, you know, permissionlessly build all sorts of cool things on top of it. Uh but so just to jump back to your actual question, because I feel like I didn't quite um get through that, is is that

you know.

Part of the fragmented, broken experience we have today is that L1 is going to be the most expensive place. So if L1 is a hub, if L1 is a starting place, then everything is subject to that most the like the most expensive of the chain. Like L1 should be the most expensive chain. If L1 is the most expensive chain, then and we start every user there, and every token is created there, and every application is created there, and then you have to move into L2s, and then to move between L2s, you go through L1, then you have this thing where every single user ends up paying L1 costs all the time. You need to start users in an L2, and then they need to move between L2s directly. And it needs to be very fast and it needs to be very cheap. And when you do that, you can create like, you know, when we think about like every transaction needs to happen in under a second, and it needs to happen with for under one cent, right? Like that's what we think about when we think about the products we're building for our users. And you can't do that when mainnet is like the place that everyone is. Ultimately we see this as like an acceleration of Ethereum scaling roadmap, kind of a, you know, as well as like a

you know, uh kind of an acceleration even of you know the the the you know of the super chain and and and Carl's vision and and kind of this sort of like uh advancement of how we scale layer twos and and create good user experiences on top of them.

Yeah, let's bring in the the super chain. I think the user experience that no one wants is that I have my assets on some other layer two, and now I have to bridge them over to the unichain. I have to make my swap and then I have to bridge them back. Uh Carl, maybe you can kind of uh talk to us about the role of the super chain here and the interop uh uh puzzle pieces that are bringing uh to the table with this whole unichain thing.

Totally. So the super chain is exactly here to address that kind of network switching and you know high latency interoperability pain points. And so that comes in the form of a couple things. One, it comes in most importantly, shared standard. So the OP stack, shared standard across all of the chains within the super chain. This gives developers the ability to build their application and rely on each one of those chains working and functioning in roughly the same way. That is like the core primitive that is most important. And so it's actually, by the way, super exciting to see Uniswap uh uh building out all of these extensions and improvements to the OP stack, to the super chain, because that is going to, as Hayden said, increase or improve the scalability story and the interoperability story for all of Ethereum. So what we're really trying to do to kind of like nail in or drill into the interoperability stuff is we have kind of one, we have Ethereum-wide interoperability standards that we are pushing forward, things like cross-chain intents, things like uh, you know, chain-specific addresses. There's a huge amount of stuff we can do to unify all of Ethereum and defragment it and provide, you know, shared liquidity. And then there are things that we can do also within the super chain, within the chains that have shared standards, such as really low latency interoperability and you know, really low, you know, zero slippage, uh, you know, token transfers, et cetera, et cetera. And so I'm I'm I'm actually super excited from uh for Uniswap, both contributing to the kind of cross chain intents and like bridging the broader Ethereum ecosystem because yeah, Uniswap is on all of these different chains, and also for being, you know, a key member of the super chain and uh uh sharing the OP stack and improving it together.

Yeah, uh it might help if um I talk a little bit about like even the

what you we keep alluding to these like improvements or enhancements or extensions to the super chain that we were building and how it like relates to these user properties. It might make sense for me to just explain what they are

Sure.

and what we're actually talking about here. Um we'll also add that in in addition to like protocol level standards, even like interface standards, one of the reasons it's like a really exciting collaboration is that we've always been very user focused and and and front end focused is in addition to the protocol level thinking that we do, and we kind of try to like bridge, we we try to bridge, you know, be a bridge between like

Understanding users, understanding application development, understanding protocol development, understanding chain development, and kind of like

uh span the full the full tech stack and thinking there. So just want to add that even like interface standards, when you talk about like how wallets interface with chains and even like display balances, et cetera, et cetera, like removing the network switcher, all that stuff is like is like part of this. And so it's we're we just want to like build the user experiences and like work through each problem iteratively. But when it comes to the um

the technical enhancements. Uh there's basically like two main areas that we're so at its core we still have this like, you know,

sequencer roll-up model that that is you know used and adopted by Optimism and and uh and base. And then what we have we have basically like two components that we've built on top of it. Um

Which you know we're we're pretty excited about. One is basically like a builder and and one is uh basically like uh you know a verification service. Um that so the the builder kind of comes before transactions uh you know go into the sequencer. Um and then the the verification service actually happens after the sequencer, but before they're you know finalized on L1. So we have these like additional layers. Uh at its core, you still get the like the experience and the scalability belt benefits of the single sequencer. Uh but at the builder level, we're able to um