Aztec: The Private World Computer for Ethereum Privacy

Welcome to Bankless, where we explore the frontier of private internet [music] money and internet finance. This is Ryan Sean Adams, just me today. So, I'm here to help you become more bankless.

There's been this recent refrain in crypto. It's almost rings out like a

crypto. It's almost rings out like a complaint. Where have all the cipher

complaint. Where have all the cipher punks gone? I'm pleased to say I have

punks gone? I'm pleased to say I have two of them on today's episode, and honestly, uh, talking to them was like a breath of fresh air. The promise of their project Aztec is to bring privacy

to Ethereum without cutting any corners.

They're trying to ship a private layer 2 that truly extends Ethereum grade decentralization with privacy on top private transactions

for all of DeFi. Now, I know it's still early, but honestly, I think they may have done it. Zach and Joe have been working on Aztec for so long that I think a lot of people in crypto half

expected this thing would never ship.

Yet, it's here. The Aztec network is live. It's producing blocks. These are

live. It's producing blocks. These are

private Ethereum secured blocks and they're just months away from an alpha mainet.

To me, this is probably the most cipher punk project to launch in crypto since maybe 2016. And maybe it won't be

maybe 2016. And maybe it won't be successful. After all, the critics keep

successful. After all, the critics keep telling us that the world doesn't care about decentralization, that crypto is now just a whole bunch of ETFs and corporate chains and Black Rockck and

compliant stable coins. I think they might be wrong about this. The world may not care about privacy and decentralization, but the world definitely needs it now more than ever.

And crypto needs more cipher punks like Zach and Joe.

We'll get right to the episode, but before we do, I want to thank the sponsors that made this possible. You

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Fra designed for the future of compliant digital finance. Zack Joe, welcome to

digital finance. Zack Joe, welcome to Banklist today. Thank you so much for

Banklist today. Thank you so much for having us on. Thanks so much for having us.

>> Uh really excited about this. So it's

been 5 years almost since we've had you on Banklist. Uh this is actually a

on Banklist. Uh this is actually a screenshot from a a very young babyfaced looking David I think from one of his uh one of the many places he's lived around

the world and the two of you guys from 5 years ago. Four months or four years and

years ago. Four months or four years and 8 months ago I guess starting the question out what have you guys been doing over the past 5 years?

>> Well I guess the the obvious one is I've regrown some hair. Um this was in the [laughter] depths of in the depths of co I think. Um, and yeah, we we uh we kind

I think. Um, and yeah, we we uh we kind of hadn't seen each other or the team for a while, so we all went a bit crazy uh in the UK in CO. But uh apart from that, we we've been kind of chipping

away and bringing bringing privacy to Ethereum. So I think since we since we

Ethereum. So I think since we since we last spoke we we had a roll up uh on Ethereum called Aztec connect and we've now built a brand new version of that that brings you know fully programmable

privacy to Ethereum and it launched uh its ignition chain uh last week at Dev Connect. So a lot's been happening. Uh

Connect. So a lot's been happening. Uh

we've been kind of keeping beating on the same drum of bringing privacy to Ethereum. Um and yeah, it's been it's

Ethereum. Um and yeah, it's been it's been crazy to kind of see see the progress.

>> So Zach, how do you explain your hair situation back then? all and uh you know how have things Yeah. gone pretty hard.

Joe and I we took the opposite approaches. Joe was like I'll cut my own

approaches. Joe was like I'll cut my own hair. I was like I won't bother cutting

hair. I was like I won't bother cutting my hair. [clears throat]

my hair. [clears throat] >> Uh and uh yeah, you know, I was going on research benders back then trying to figure out how to like fix certain um existential issues with with privacy tech. So I don't know, maybe the hair

tech. So I don't know, maybe the hair helped the channeling channeling Albert Einstein.

>> Are those things fixed now? Existential

issues.

But we'll find out because uh um we we're we're going to be deploy fully deploying our our network um early next year. And uh the the issues I was trying

year. And uh the the issues I was trying to figure out was effectively how do you how do you actually take an a smart contract um platform like Ethereum programmable blockchain or world computer? How do you make that fully

computer? How do you make that fully private without destroying the user experience, the developer experience? Um

and that's a hard problem. It's took us a while to solve. why why why we've been building for 5 years, but we're pretty confident we've sold it.

>> 5 years of building. There's so much to get into today. And I guess I'll give listeners some context. So, the Aztec ignition chain is a newly launched chain. It's not fully launched. It's in

chain. It's not fully launched. It's in

one of the launch phases. We'll talk

about that. I'm actually at the time about five years ago we were talking about one of the first Ethereum rollups which was a um a rollup that the Aztec

team had come up with and you guys deployed that and then uh I believe that went into legacy >> um maybe a few years later. We'll talk

about the story of that and now where we are with this new ignition chain and what um >> all of the features and all of the things that you've built up into that that chain uh in a moment. I guess I

want to start with the high level here.

So as you think in about 2025 and going into 2026, can you describe the state of privacy in Ethereum today? Like have we made any progress? Where are we right

now? Privacy has clearly become more of

now? Privacy has clearly become more of a core value of Ethereum. People care

about it. People talk about it. Um the

quality of privacy that you have today versus 5 years ago, not a huge amount has changed uh to be honest.

um uh you know, we're starting to see the seeds of seeds of that. Uh but

ultimately, Ethereum is still a completely transparent network. Um when

you send transactions to Ethereum, everybody can see what you're doing.

They can see who you are. They can see who your recipients are. They can see the smart contracts you're calling, the programs you're using, the amount of money that you're sending around. Uh and

this is hugely restricting on what you can actually do with Ethereum. Um, just

purely being able to not being able to hide your balances uh is a big problem.

If you want to use Ethereum for anything uh competitive or professional, for example, if you're if you have a portfolio on Ethereum and you you've hedged it and you're trading well, people can see your hedges and so they

can undermine those. And we've seen demonstrated attacks against that um that have happened on Ethereum, they've happened on Hyperlquid. Um it's also

extremely limiting uh the lack of uh identity on Ethereum. But um I I think I can go into that in a separate topic.

>> So how is it the case Zach that over the past 5 years we've made almost like has there been any progress made? I mean

there are there are some privacy protocols out there right now. So um

>> there there's rail gun. Um uh I mean to cash is no longer sanctioned. I believe

it's no longer considered a terrorist by the American government.

um uh you have um uh you know you have a lot of toolkits available that could be used to build products as well uh you know kohaku is something which is being developed by the ethereum foundation

>> that's a wallet that uses rail gun I believe uh but ultimately and there's been a lot of technological innovation uh the the the the reason for the lack

of the limited progress in terms of um userfacing products and services is just it's an extraordinarily hard Uh you know we cracked this a few years ago like how do you do private token balances? How do you transfer them

balances? How do you transfer them around? You know Zcash with Pioneers uh

around? You know Zcash with Pioneers uh then you have you have things like rail gun you had a connect but the challenge is um how do you how do you add programmability into that? Because if

you want to do anything really advanced with privacy you need an understanding of who somebody is. Uh because you probably need to be able to distinguish between good and bad actors somehow uh

uh given you know current climates, given user preferences, uh given the you basic basic needs to create legitimate systems. Uh and that question who are

you that's very hard to answer in a permissionless fully decentralized network um without having to rely on centralized third parties. Is that

something that the ignition change has kind of cracked the the who are you part about that?

>> Huh. Interesting.

>> Yeah. So I think at a high level like it like the way we've kind of solved identity is is is actually it doesn't just happen to be on kind of the ignition chain. It's more about kind of

ignition chain. It's more about kind of in general the state of ZK technology.

>> There's kind of teams now building proof of identity. Um, and previously that was

of identity. Um, and previously that was kind of, you know, credentials signed by by kind of third parties like 5 years ago. Now we can take your passport and

ago. Now we can take your passport and we can verify on chain that it's a valid passport issued by the UK or issued by the US and you can effectively do um a

proof of personhood using your existing passport or identity card with a smart contract and you can selectively disclose any information you want um to

the chain in that in that check. So I

could prove I'm above 18 or I could prove I'm not from a sanctioned country or my name's not on a sanctions list.

And so we're now in this world where you can take um a zero knowledge proof, send it to a smart contract and instead of getting privacy through kind of centralized intermediaries, you can just

directly interact with the blockchain and make a compliant application that effectively knows that you're not someone. Uh and that's a huge

someone. Uh and that's a huge breakthrough. And so that's powered by a

breakthrough. And so that's powered by a lot of the technology we've been building over the last um 5 years. We

have a programming language called Noah which makes that very easy. And Aztec's

kind of the default place where you can now deploy these applications. Um and so I think it's more like as Zach was saying the the core tech has come on a

long way but we're still seeing kind of um maybe the maybe the industry catch up. there was a bit of a chilling effect

up. there was a bit of a chilling effect that came into effect around tornado cashache and kind of the the ban of privacy in in the US which I know you guys fighting for as well on the front

lines. Um I think that has maybe slowed

lines. Um I think that has maybe slowed down where privacy adoption could be relative to kind of where it is in the background. But we feel very confident

background. But we feel very confident that the tech now is ready to kind of make a breakout because we have these amazing tools like ZK Passport that can put it front and center again. Let's

talk about ZK Passport for a minute and this this idea of identity because I I do think you're right. Um privacy and identity seem to coexist or at least

grow together in some way and I think the lack of identity solutions, private identity solutions has maybe prevented us from scaling privacy uh in the way that we want to scale it. I was looking

at a lot of um there a bunch of tweets in my timeline over the past few days that looked something like this. And I

think this is um you know a a tweet from from Martin over at uh the NOS safe project and he's tweeting a picture a

Google Gemini AI generated deep fake of somebody with a passport. Actually this

is him with a passport. Okay. And so,

um, you know, he's using an AI prompt to basically deep fake AML KYC Gemini style. I think everyone listening to

style. I think everyone listening to this has probably signed up for some sort of digital bank online, maybe an exchange, and there's some sort of AML

KYC type of service. And the way this goes is usually take a picture of your driver's license or your passport, and you send it in. And then there's a um

you know I guess a proof of personhood type realtime checker where you take a selfie of yourself. You might look into the camera, you might stare left, you might stare right and it you know

signifies this is a human, that this is Ryan S. Adams and we can let this person

Ryan S. Adams and we can let this person in because he's not on a sanctioned list. It's interesting that AI is going

list. It's interesting that AI is going to break this completely. Is it not? I

mean the ability to just deep fake this.

like and I don't know that world governments or addition you know existing compliance regimes have caught on to how fast this is going to happen

and it has already started now that method is basically broken uh can you talk about this and how is something like ZK passport a change from this

regime yeah maybe I can start I think I've got a few good analogies here so I think since about 12 15 years ago um

ICAN who are the kind of civil aviation kind of body um started creating e- passports um and they created this standard that has uh means that kind of

all modern passports and identity cards they have a chip in them and that chip can be read by an NFC scanner and inside it it has data that's signed by the

issuing authority. So your government

issuing authority. So your government who issued the ID card who you know you you may not trust fully but if you live in that country they're they're a good source of trust. um uh as kind of like a

a trust authority. And so what ZK passport does is it uses the same tech that lets you enter through an e-gate uh when you scan your passport in an e-gate. What's happening is they're

e-gate. What's happening is they're reading that chip. Um they're kind of using the um there's a decryption key embedded into the image um they're decrypting information in that chip and

they're making a zero knowledge proof that that's valid. And so

>> can you hold on for a second here, Joe?

So the an NFC chip inside of a nation state password is is that counterfeit resistant? Is that uh tamper resistant?

resistant? Is that uh tamper resistant?

>> Completely.

>> Completely. Yeah. I mean it's Yeah. It's

kind of all of the chips. Um there's a big kind of like uh tree of trust. Um

and so at the top of that tree, there's a a private key stored by a nation state. Um and you can verify that every

state. Um and you can verify that every chip that's issued and and signed has been signed by that key. So unless you can get hold of um an Asia state's private key, you can't issue uh and

verify a fake passport. And so this is how we let people into countries. This

is how e-gates work. And what we're what we're doing kind of in Ziki passport is we're taking that same signature um uh that's embedded inside your passport and we're verifying it in zero knowledge and

getting Ethereum to say, "Hey, is this valid?" So you can kind of think of like

valid?" So you can kind of think of like Ethereum is now an e-gate for transactions and you you know the with the same security um as you have to enter the US or the UK or any kind of uh

country we can now get the same attestation uh that you're not on a sanctions list or you're from a certain country which is crazy that that this is this has kind of never happened before and all of the web two companies are

still using kind of >> pictures of your of your [laughter] ID and aliveness check and so um yeah we're very bullish on this as being kind of a a much more private way of doing things.

It it takes a little bit of a mental model switch because at first when people hear about privacy, they're like, "Oh, I I don't want to put my ID into something." But that's because Ethereum

something." But that's because Ethereum is fully public. Now we have like strong zero knowledge proofs and and a way to kind of actually encrypt that information and send it to the blockchain. You can start to send this

blockchain. You can start to send this information as part of transactions and pro prove interesting things about it.

So, I think that shift is going to start to come and I think it's really the only way we have to kind of resist against kind of deep fakes. Um, so it's going to be exciting 2026, I think.

>> Can I make sure I understand the user flow for ZK Passport? It's been on my list to go, you know, try this and check this out. And I know it's kind of

this out. And I know it's kind of integrated into the part of the onboarding experience of of Aztec, which we'll we'll we'll talk about in a minute. But, so you're saying basically

minute. But, so you're saying basically I take my governmentissued passport. I

have one from the US. Let's say has an NFC chip in it. And what do I do? My

phone, like my iPhone with a ZK passport app can actually has the ability to scan an NFC chip and validate it. Totally.

So, so you know, you tap your passport to your phone. Um, it'll the phone will scan the chip. What's going to happen is it's so that that that chip will give your phone a digital signature like all the passport data like your your photo, your passport number, your date of

birth, your name, blah blah blah, stuff you don't want to share with the world.

And what's going to happen is our we Zika passport uses our technology to create a zero knowledge proof saying here's a hash of all this data like an unintelligible hash. I'm not going to

unintelligible hash. I'm not going to tell you what's inside it. But I can prove to you two things. A you know um it's like this person is not from a sanctioned list. And B, this is quite

sanctioned list. And B, this is quite important. this person's phone um has

important. this person's phone um has like what it what it ask the app asks you to do is it asks you to take take a take take pictures of your face and your phone's secure enclave like the little

secure chipets will say this this photograph that I've taken it lines up it matches the face of the it matches the photo in the passport >> um and so that's also wrapped into the

proof so you don't just know that somebody possesses a passport from a certain region you know that they're that that also like they're live as in like the the person holding the passport

is the person um uh running the app.

>> Okay. So the the ZK ZK passport not only verifies that I have a passport in my possession NFC chip but it also does that live as well with my face and sort

of matches that but that information stays effectively within the secure enclave of my phone. It doesn't it doesn't leave your phone because the secure enclave creates a digital signature going yeah this is good. Um

and then that signature is validated within the ZK passport proof so that um you know I I think this is how it works.

You basically you know like yes there like there's a there was a license check performed by like an an iPhone or an Android phone um of a of a of a of a photo that of somebody that matches the

photo in a passport and that passport is like from a certain region or not from a certain region. Uh and that's the data

certain region. Uh and that's the data that gets broadcast. Um, so so the act things like your photograph, your name, date of birth, that stuff that stays stays on your phone.

>> Wow. Okay. So I I mean even that alone, I know this is a powerful application of ZK and it's it's broader than uh Aztec, but that alone with the advent of basically AI deep fake coming out over

the next 6 to 12 months.

>> I mean, don't all web two companies, doesn't the entire financial system, doesn't like everything need to de facto adopt that? Like what's the other what's

adopt that? Like what's the other what's the alternative? Every everything

the alternative? Every everything happens in person again. I like that can't be what we do.

>> Zach keeps saying that privacy is eating the world, but I think this is a clear case of like >> [laughter] >> um like where it has to, right? Wait a

minute. It's like I I I think otherwise we have to stop doing things on learn or >> um we're just you rely on trust with third parties, right? Everything

password app does.

>> You could get the same effect if you just send all your data to a server and then that server has your passport data and that's often how it works today and then you get those servers get hacked and your passport data gets leaked and

it's a nightmare. Um yeah, the doing it the zero knowledge way is the secure way of doing it for sure. Okay. So, that's

the ZK passport piece of this. And I

guess that um that works very natively inside of a crypto system, right?

Because then you know that um you know this person is who they say they are and maybe they're not sanctioned. Ju just

briefly though, how is ZK Passport related to the Aztec project? Is it sort of just a an adjacent type of um

application that can is useful for privacy or are you guys tied into it?

>> So, a few ways. So it's a team we funded in our ecosystem. Um so that's kind of the main main kind of relation. Um but

beyond that there's a few other places where uh there's overlap. So you can take CK passport proofs. You can verify them completely offchain. So kind of like proof of age um on on kind of

websites. Um you can verify them in

websites. Um you can verify them in Ethereum smart contracts or um you can also verify them natively um inside Aztec transactions. Um, and so you can

Aztec transactions. Um, and so you can take this zero knowledge proof and ASL is kind of like the the best place to verify these proofs. So that's that's that's kind of one area where they're also related. And then secondly, we're

also related. And then secondly, we're also using this um in our token sale which is happening uh at the moment. So

we've been able to convince um Swiss regulators that using a zero knowledge proof of uh non-sanctions um is a valid form of sanctions check. So if you if

you want to go and participate in in token sale, you can go and use Ziki passport and I think for the first time you can use this kind of uh zero knowledge proof to prove to an Ethereum

smart contract that you're you're not on the sanctions list which is uh incredibly exciting. You can obviously

incredibly exciting. You can obviously go and do the old way of like doing KYB or KYC if you want to, but there's now a privacy preserving alternative. Um and

the last way it's related is uh it's also using is is written uh under the hood in uh this programming language we've built called Noah uh which is a kind of very developer friendly uh

language for writing zero knowledge applications. So because ZK passport

applications. So because ZK passport team is in our ecosystem they've been building this in in no for the last kind of 12 or so months um which is exciting to see. So for the the the ICO that the

to see. So for the the the ICO that the the coin sale that's ongoing right now ZK passport is effectively used in lie of a traditional AML KYC check just to make sure that the entity has not been

sanctioned and is eligible for the token sale. That's correct.

sale. That's correct.

>> Yeah, we we were able to get the Swiss Swiss kind of regulators to kind of uh this was like a valid form of sanctions check for individuals. So uh

yeah, it's pretty exciting. Will will

individuals need like later when we go full mainet and start you know um and users start using the Aztec chain will they need CK passport in order to interact with the rest of the protocol or is that part completely permission

permissionless you know like from from day one on networks permissionless decentralized we have account abstraction so how one chooses authorize their account >> that's up to up to up to anyone um but

you know we won't be star we won't be using Z passport for that cuz it's not uh well we don't think users will application developers because it's not convenient to carry a passport around everywhere to log into a web 3 account.

Um, but if I could segue a little bit, this kind of touches on something which is quite a quite a a core issue and value proposition in inside Aztec, which is how do you how do you know somebody

who somebody is um let's say you're building an application uh like a private stable coin and you need some understanding that like for example like you know the person is in North Korea, right? because funds are not if fund if

right? because funds are not if fund if you can't see what what's going on you need some understanding you're not a baddie uh it's also very important for for us as as AS as a network that we

give application developers the tools and the resources to program their applications such that um they can give guarantees to their users that their users are not facilitating bad actors

you know we don't mandate any of this we just want to make it possible and and so this ties into something which We're very very keen on um pursuing with our stick with an Android and our ecosystem

which we're calling holistic identity effectively um right now the way the world works when it comes to identity is you know you have some centralized third party comes up with some kind of standard

that's like 200 pages long and then it gets it gets implemented um and uh and it doesn't change because changing is just too much effort uh and it means that um you know this this kind of

identity center is very rigid and flexible and can't get used by a lot of applications that could benefit from it.

What we want to do in Aztec is the complete opposite instead of top down as bottom up. The idea is let's say you're

bottom up. The idea is let's say you're an app developer maybe have some identity needs. Well, it should be very

identity needs. Well, it should be very easy to program those like checks and checks into your application. You know,

we'll provide the libraries and resources and in doing so that application developer is effectively issuing a credential on chain like an NFT or a token which is attesting something about a user. It might be as simple as you know this user has a

Twitter account with over 100 followers.

So, they're probably not a bot. It could

be this user has received an email from a certain company. So I know they have an account with that company. And you

can use ZK knowledge zero knowledge zk email our technology to prove that if you have enough of these people participating in the network building these applications building these credentials um issuing platforms then

you can start to create meta credentials on top of that. Right? you can start to wrap a lot of these tokens um so that you can say something more concrete about an individual um uh and in doing

so I think you can end up in a world where you have very strong identity checks identity standards but what's happened is twofold two things first of all it's all using ZK so none of the

data is leaving the user's device right there's no actual like data on chain on the network that is telling you about what somebody is it's all encrypted but the other important thing is these credentials an order being issued by

centralized third parties that can exert a lot of control over who participates in the network. The idea is we don't want like one, you know, identity provider saying, "Oh, who, you know, you're Ryan, you're Joe." We want we

want smart contracts to be able to go, "Oh, yeah, you're probably Ryan." But

that that knowledge has come from >> possibly hundreds of different sources all all on chain that have been issued by hundreds of different counterparties so that you have a fully genuine

decentralized um permissionless network that can provide strong identity uh strong privacy benefits. So in that in that world then nation states and and government and passport issuers are just

one more tester essentially and they're they're able to attest citizenship and some other things with with some certainty but there are many hundreds of testers. This has been kind of a a

testers. This has been kind of a a promise that Ethereum has made for quite a while. There's kind of like um

a while. There's kind of like um Ethereum identity protocols that have been proposed. How come we've not gotten

been proposed. How come we've not gotten this on Ethereum already? And what is Aztec specifically doing to bootstrap uh

ZK attestation to you know to be able to >> provide richer identity services.

>> I think the main thing is that the earlier versions of this required an intermediary. So it was like hey give

intermediary. So it was like hey give your data to this service then they'll sign a message saying you you did the thing. So you know uh it could be

thing. So you know uh it could be >> um you know that you control this email account or that you have this many followers on on Twitter but it was all intermediated. Um then there were some

intermediated. Um then there were some projects um I think Polygon had a project around kind of like ZK ID. Um

but a lot of it like the the credentials that you want um use web 2 cryptography which notoriously is very hard to kind of prove things about in ZK. And so we

needed some breakthroughs in in the kind of uh cryptography uh technology to actually make this possible. So I think I think like now we're in a world where it is possible. So it's always been the promise but I think we haven't been

there today because either the tech wasn't fast enough to prove things locally on your device >> or it was just done through intermediaries before and uh that didn't really catch on and it was kind of against the the whole whole thesis of

Ethereum which was like remove the inter intermediaries. And so I think those two

intermediaries. And so I think those two reasons are why it hasn't happened in Aztec. I think the main reason why we we

Aztec. I think the main reason why we we think it's going to take off is because every transaction is a zero launch proof. So um there's no there's no way

proof. So um there's no there's no way for you to kind of like leak this information. You can bring in all

information. You can bring in all different types of data sources in into one transaction on Aztec and and verify them all succinctly and cheaply um when you send that transaction uh to the

blockchain. So I think that alone should

blockchain. So I think that alone should encourage developers to start experimenting and we should just see this take off naturally is >> expand on that as well. Um another key

thing is you really need a fully private by default blockchain for any of this to work. Um, and this and this concept of

work. Um, and this and this concept of private composability. Basically, I can

private composability. Basically, I can write a private smart contract and I can just code it up like in a regular normal looking programming language like Noir and my contract can call other private smart contracts written by other people and they can call other private smart

contracts and this all gets bundled up into a single transaction the user sends. It just works. Um, that's not

sends. It just works. Um, that's not possible anywhere else. And I'll give an example of why it doesn't work on Ethereum right now. Let's say you want to build some kind of identity standard system on Ethereum, right? You need ZK because that data can't be transparent.

You can't, you know, you're not going to put passport numbers, social security numbers on a on a public ledger. So, you

need to do something in ZK. And that

right now on Ethereum because Ethereum doesn't have default privacy requires you writing some complicated ZK circuits and have and providing some complicated ZK software for users to generate those

required proofs, send them to Ethereum.

Um, so now let's say someone's built that and now I come along and I have an app and I'm like, well, I need a slightly different concept of identity.

So, I got to build my own and I got to do this all again. And I know I've got my own ZK stuff and my own ZK software.

And let's say there's a third app which is like some exchange or an AMM in it and it says, okay, well, I want to interface with these two identity platforms because I need both of them to interoperate. Well, now I have to

interoperate. Well, now I have to inherit that complicated tooling and software on my end. And if anybody wants to incorporate my app, they have to do the same. And you have this kind of

the same. And you have this kind of explosion of complexity because every privacy solution on Ethereum has to be its own like handcoded circuit with its own tool chain. Um

that's not the the case on Aztec, right?

You can code up your whatever whatever your program's doing if it's doing identity or games or whatever it's doing. You just code it in no and you

doing. You just code it in no and you know your contract has a an interface that gets exposed, right? And then you can just ask your node to call a contract and it just works. Um, and so

you can actually start to build these composable private systems um, with with a real network effect.

>> One of the things that I feel like has always been central to the Aztec project as you've moved through different iterations of what this looks like is actually bringing privacy to Ethereum

specifically. And I think maybe the

specifically. And I think maybe the reason for that is because you want to make privacy programmable. So privacy

does exist in pockets. You have uh a chain like Zcash for instance which tries to accomplish kind of a Bitcoin

transactional UTXO model style uh chain and provides u privacy around that. Uh

we also have things like rail gun or or tornado which maybe allows for privacy of you know privacy pools and kind of like shielded uh transactions in some

small form. I think the the main thing

small form. I think the the main thing behind Aztec and why I've long thought that this was sort of the promise at least is is the holy grail. It's

actually bringing um Ethereum's touring complete programmability which implies all of DeFi and everything that can be built on top of um on top of

Ethereum bringing privacy to that. Can

you talk about that? Is that still kind of the mission behind Aztec? this this I I think part of my question going into this is like okay this took a long time and I know you guys have been hard at work. I know it's not like you've been

work. I know it's not like you've been slacking off for the past 5 years playing with meme coins. You've been

hard at work on this. Is that the big thing? Is that why it took so long is

thing? Is that why it took so long is because you needed to preserve the programmability. Maybe talk about that.

programmability. Maybe talk about that.

Why is that the mission and why was that so hard?

>> Yeah, 100%. So that that's definitely still the mission and and we kind of get there in in two ways. Um, I think the the first way I think is is to maybe look back at we what we talked about

last time on the podcast which was kind of how we can bring privacy to existing DeFi. Um, and that was with a uh a

DeFi. Um, and that was with a uh a product we called Aztec Connect. Um, and

and what we had with Aztec Connect was a way to effectively have Zcash style transactions for any ERC20 on a rollup we built, but we gave that roll up the

ability to interact with other Ethereum smart contracts. So if you sent a

smart contracts. So if you sent a transaction from the the kind of Aztec connect L2 back then you could bridge funds uh effectively to any DeFi on on

on layer 1. We have built that functionality into kind of every smart contract um uh on on the new Aztec chain. And so by default in this chain

chain. And so by default in this chain you can now bridge funds from any Ethereum smart contract and any Ethereum L2 smart contract. And the reason this works is because Aztec's block space is

differentiated. If you send a

differentiated. If you send a transaction from Aztec, the block space is private. And so you can bridge funds

is private. And so you can bridge funds uh to base or to arbitum or to optimism, you can bridge an intent to those networks and you can interact with

existing pools of DeFi without having to rebuild unis swap or ave on Aztec itself, which is really exciting. And

the reason it's taken so long is exactly kind of um uh what you were trying to say earlier around preserving composability. When we had the old

composability. When we had the old version of Aztec, we wrote all the smart contracts that existed inside Aztec.

Effectively, there were three smart contracts. There was an account

contracts. There was an account contract, a joint split contract for transfers, and a DeFi contract. And we

had to kind of audit them all against each other. They were all written in

each other. They were all written in C++. And composability was a nightmare.

C++. And composability was a nightmare.

What we realized kind of uh with that that old version of Aztec is that you know in order for this to take off we had to build programmability and composability between smart contracts

into the protocol and have it such that a smart contract could call another smart contract without the core team having to kind of audit it and write it.

So that was the big breakthrough that took many years um to to kind of get right. But effectively what it means now

right. But effectively what it means now is that you can have this programmable composability within Aztec and each Aztec contract can call five contracts

within Aztec the L2 and then you can also have the result end up on another L2 or Ethereum and you get extern incredibly strong privacy guarantees as a result. So, we kind of view our us as

a result. So, we kind of view our us as like a bit like a privacy layer for all of Ethereum and it it doesn't matter kind of where the transaction ends up because um you're you're kind of moving

funds as a user through Aztec. You get

privacy as a as a result of doing that.

>> It's a private world computer, right? Um

Ryan, you're completely accurate when you're talking about like our our goal of being a a private Ethereum. Yes. uh

you know that privacy tech I think right now before uh I know there's been some years away from this but it's largely in terms of the applications you can use it's private Bitcoin that's what it really is and we

want to make it privacy tech private Ethereum that programmable world computer is is the thing that really captured us in the early days you know the idea that you can write any kind of

like software you can write like a like a decentralized bank you can do assets you can do finance you can do derivatives you can do voting you do governance it makes it's just a financial technology like Bitcoin. It's

a it's a social technology. It's a way of organizing people um and organizing communities and getting them to like coordinate and collaborate on shared

projects and uh that that side of Ethereum I think is very constrained and limited because of the lack of privacy.

The financial side is limited by the lack of privacy. It's all limited by privacy. You know, we came into this

privacy. You know, we came into this looking at privacy thinking this is like the missing ingredient to make Ethereum like really big, really really big. uh

you know like the world spanning financial infrastructure. Um so yeah,

financial infrastructure. Um so yeah, we've been obsessed with it for years.

The private world computer um bringing privacy to all of Ethereum, the Aztec ignition chain is a layer 2 and Joe when you were talking about this um you were

talking you were using terms like composability and I think the experience that users have with layer 2 is not quite composability. In fact, they might use

composability. In fact, they might use the term fragmentation instead. So the

typical experience of using a layer 2 is it almost feels like going to a separate country, you know, a separate chain, right? So like I take my whatever asset

right? So like I take my whatever asset on ether and if I want to go trade it for an asset that on Ethereum rather than if I want to go trade it for an asset on base, I have to go through this whole process of like bridging to this

layer 2 and there's a different, you know, set of liquidity and there's kind of a different UX. I feel like I'm in a different land altogether. Um, how does

I guess how does Aztec in because it is a layer 2, how does it blanket existing Ethereum with privacy and preserve some of that composability? Maybe would be

helpful here is if you took listeners through a typical flow. Let's say they have Ether as an asset and they want to get some USDC, okay? and they want to

make uh a trade ether, exchange my ether for USDC and they want to do that privately. Okay, do they have to go

privately. Okay, do they have to go through this process of uh I got to go bridge my Ether all the way to Aztec. I

get to Aztec and there's limited liquidity for USDC. I'm getting worse trade execution. Uh and I'm in this

trade execution. Uh and I'm in this Aztec world and by the way, it took a long time to bridge and it's a pain in the ass. and then when I want to move my

the ass. and then when I want to move my USDC back to Ethereum someday, then it's a whole another process. Is that the user experience? Um, or can we do

user experience? Um, or can we do something better? Like when you when you

something better? Like when you when you said composability, I was I was hopeful for a feeling that I'm still on layer 1, but I'm somehow in my wallet, I'm being able to click a button that says like do

this incognito or do do this transaction uh privately, and it just seamlessly happens for me. Is that a world we could live in? I think I think the answer is

live in? I think I think the answer is yes and no. I mean I mean under the hood bridging still has to occur. Um it it depends on how much you abstract that from the user. So to walk through the

flow um there's kind of two ways it can work. Um one way is kind of the user

work. Um one way is kind of the user moves their funds to Aztec. Um and you do still have to go for a bridging flow.

But when you do the bridging from Aztec you can pick any destination chain. you

can pick which liquidity um kind of uh you want to trade against and you get privacy as a result of doing it. So it's

kind of like you take the existing bridging flows which can suck um but you're at least giving them a reason to go through them because when they go through them from Aztec um you will get

privacy uh by default. So that's kind of like one flow and like maybe just make it >> if I'm bridging and I want to go to base, you're saying I can go through Aztec first and then I'm starting from a

like privacy. I have a private instance

like privacy. I have a private instance of base. So Aztec is sort of a you pass

of base. So Aztec is sort of a you pass through chain.

>> Yeah, that's kind of the the best way to think about it. It's a bit like the whole like intent meta like near intent is a great example with what's happening when with with um uh near intent on

Zcash. Um, but effectively as as an

Zcash. Um, but effectively as as an Aztec user, you would have, let's say you have 10 E on Aztec and you decide you want to switch it for for USDC on on base. Well, you send a transaction on

base. Well, you send a transaction on the Aztec out to that says, I want to swap 10 E um on base for USDC. Um, and

the world sees someone on Aztec wants to swap 10 E uh for base on USDC and they want the funds to be kind of sent back to Aztec. Um, what happens under the

to Aztec. Um, what happens under the hood is a relay comes along and they pick up that intent. They fill it for you and they return you the funds and they can return the funds to Aztec. They

could prefer they could return the funds to a brand new account abstraction account on base that's controlled by Aztec. They could even return the funds

Aztec. They could even return the funds to a through a mainet uh if if they wanted to. Um, so there's lots of kind

wanted to. Um, so there's lots of kind of different like ways this pans out, but effectively because the user who's doing the transaction um is not known inside Aztec, uh, you get a degree of

privacy doing this. There are other ways to do this directly from your kind of Ethereum wallet. Um, but that requires

Ethereum wallet. Um, but that requires kind of a little bit of adoption on the kind of L1 wallet stage. Um, which which obviously hasn't happened yet cuz Aztec's brand new. Uh, but over time I think there will be ways to streamline

this under the hood. So, you may not even know that you're bridging uh when you do this. And there's a lot of work going on in the Ethereum space right now to try and um unfragment Ethereum. Uh

and that will just make it even easier for us to um bridge privately to to other chains. So, I think it's um yeah,

other chains. So, I think it's um yeah, it's going to be exciting year to kind of see this this bridging uh or intent private intents kind of play out. And

the way I think about Aztec in the short term is kind of what percentage of transactions on all these L2s would like to have some privacy. I think a decent percentage of users may route those transactions through Aztec as as a way

to kind of maintain some of their privacy. You can go a step further as

privacy. You can go a step further as well and say that when you route through Aztec, you can enforce logic ahead of uh those transactions. So let's say you

those transactions. So let's say you have now um a real world asset pool on arbitum where only people in the UK can interact with the pool. You can put a ZK

passport proof ahead of the transactions on Aztec and say, "Okay, well, we want, you know, to enforce that only users who have UK passports can interact with this

pool." And uh the same flow as possible.

pool." And uh the same flow as possible.

And what you would see kind of in public was someone on Aztec who has a UK passport wants to trade with this pool.

Um and you would have a guarantee from Aztec backed by Ethereum because we're we're an L2 that kind of rolls up to to Ethereum that this is true. And so you get this kind of incredibly strong

privacy kind of uh credentials as a result. And over time we will see DeFi

result. And over time we will see DeFi kind of net new DeFi start to be created on Aztec. But I think that will mostly

on Aztec. But I think that will mostly be we won't be recreating unis swap or are they? We'll be building D5 that

are they? We'll be building D5 that requires privacy kind of built into it to function. And a good example is maybe

to function. And a good example is maybe the difference between an AMM and an OTC desk. Uh so there will be kind of new

desk. Uh so there will be kind of new DeFi primitives built on Aztec because privacy expands the design space but in the short term we we'll see a lot of this kind of private intent flow uh to

kind of bring privacy to to all of Ethereum.

>> Fascinating. Okay. So the private intent flow is really part of the unlock here that really allows Aztec to blanket the rest of Ethereum and all of the layer 2s, the L1 and the layer 2 with privacy

rather than cuz I think a lot of people listening might be stuck in the paradigm of rollups from 2023, 2024 and even 2025, which is if you start a new rollup, the number one thing you have to

do is you have to go copy paste all of the existing Ethereum D5 protocols. So I

need my, you know, I need my version of a I need my version of of Uniswap. I

need, you know, all of the different primitives that I find on Ethereum and they have to I have to copy and paste this and then bootstrap the liquidity and of course these, you know, ecosystems need to port their contracts

and that gives me a little containerized ecosystem, right? That's that's way the

ecosystem, right? That's that's way the the way maybe I was thinking about Aztec going in or some listeners are thinking about it going in. You're saying that's not the case. effectively the entire

Ethereum ecosystem, all the layer 2s, all of the D5 protocols on Ethereum mainet, they can using private intents basically tap into Aztec privacy on

demand. Um, you know, at request and I

demand. Um, you know, at request and I guess you know maybe talking about the user experience of that if that's painful at first because it's not directly integrated into wallets. I

don't know if that causes additional transaction fees or delays, but the idea is you're able to blanket the entire Ethereum ecosystem and everything in

DeFi, all of the liquidity with privacy rather than having to copy and paste and start from scratch. Am I understanding this correctly, Joe?

>> Yeah, definitely. Um all we need kind of when the chain like transactions are enabled on the chain is one UI that enables uh you to deposit an Ethereum wallet and you could have because we have really uh native account

obstruction features you could just go to that UI that DAP and it can give you access to all of Ethereum privately. So

that's like one smart contract on Aztec uh which enables all of that. And

obviously you could have much more um expressive contracts and so we're excited about the the design space kind of expanding but yeah with one one simple kind of bridging contract um and

we have I think two teams have built them already the wormhole team and a team um uh called uh oh I forget their name for now uh but uh the wormhole team

has built a bridge um and yeah they that that basically gives you that that functionality for free and you don't need to bootstrap any any new liquidity you just need users to kind of decide

they want privacy which I think most people do and that should be a very compelling use case.

>> So in my wallet I want privacy for this particular swap transaction. This is in the far future maybe and I click the make my transaction private um button.

Will this require additional fees uh from a user perspective? Does Aztec kind of take a cut? And what about the um the time right like to bridge to get the kind of the order filled all of that?

Will that add some delay to my transaction as well?

>> Yeah, it does add some fees. You have to send a transaction through Aztec. Um,

but we're a layer 2, so like most other transactions will have kind of 2 to 5 cent transactions. Um, so there'll be

cent transactions. Um, so there'll be some some fee you have to pay pay to Aztec. It's fairly nominal um, and a

Aztec. It's fairly nominal um, and a fixed fee. And most of these use cases

fixed fee. And most of these use cases require one block on Aztec and one block on the destination chain uh, to kind of fulfill. So there's a little bit of

fulfill. So there's a little bit of latency, but with with block times coming down um to be kind of like subthereum blocks, like it should be it

should be kind of a pretty great UX um in the near future. So I think it's you know from from a kind of when the transactions confirmed to when it actually settles, there's a difference

there, but from a user perspective, they should just send the transaction and it's kind of set and forget. to add to that I think I think it's uh substance labs and train and the other othering partners that we're tapping it to uh

that we're working with um I think to just at a like a high level fundamental reason why why we are doing this why we can do this um is because like bridging into an out of Aztec in my opinion is

very positive sum and it's quite unique because most most L2s are parasitic to their L1s uh because you know you want your own liquidity as you said um it's fragmented that's because of the incentives right every protocol wants

own little ecosystem and they're all largely undifferiated, right? They all

have AMMs, they all have lending markets, they all they all like they all have the same stuff and so they're all trying to compete with the same liquidity.

With Aztec, there's a very unique distinction which is that there is value in bridging not not assets but information into and out of Aztec. um

where if if a transparent network wants to either like do some kind of permissioned request that requires knowledge of a user, they can send a request to Aztec going, "Hey, is this person who they claim to be, are they allowed to do this?" And then the other

network can perform the checks encrypted in an encrypted way and then send back yes or no. Or you can use intents to perform um bridging to to get access to private um private funds for DeFi.

Either way, the the the assets um the their the long-term home is on some other network. um what's happening

other network. um what's happening inside Aztec is really information processing, but we get fees from that.

So, we're happy as a network and the other LT and L1 are happy because they get added value from connecting with Aztec. So, I think you're going to see a

Aztec. So, I think you're going to see a very different dynamic between Aztec and and the rest of the ecosystem that you don't see with transparent L2s. So, is

this it? Does this solve privacy on Ethereum? Like, are are we done here

Ethereum? Like, are are we done here once I I know Aztec isn't fully made.

talk about that. But once it is once wallets integrated um we have private transactions for everything in DeFi.

Correct. Is is that it or is there is there something that Aztec doesn't I'll try and be >> try and be [laughter] objective. I mean

it does largely solve it in my opinion.

I think that the challenge is execution right? We need a [clears throat] lot of

right? We need a [clears throat] lot of app developers to grind to the culface to build these systems. We need a lot like we need work from all the developers to integrate. Um but

fundamentally yes uh where we're basically when NASCA launches we're where Ethereum was in 2015 but for privacy. Uh so we have a lot of work to

privacy. Uh so we have a lot of work to do like we're not going away. We're

going to keep pushing the boundaries because we want the network to scale. We

want it to be faster, more throughput.

We want it to be cheaper. We want it to be more seamless, faster block times. So

there's all there's all sorts of work we we can and are going to do there. But

the fundamental primitives of of what you can do um yeah they'll be they should be possible, you know. Um, feel

free to call call me and J out on this in in in 12 months time, right? If you

can't do this stuff, if you can't publish privately, if you can't tap into D5 privately, call us out on this cuz this is our goal. This is our dream.

Wow, that's amazing. Um, so this is not live yet completely. Let's talk about what is live. So there was a mainet launch of the Aztec ignition chain, but

I think this has been described to me as almost like a a beacon chain type launch, whereas it's um it's available for uh sequencers or maybe we'll call them validators. Want to define that

them validators. Want to define that role to just sort of get involved in the network and help run some of the infrastructure. It's not available for

infrastructure. It's not available for users yet. It will be available for

users yet. It will be available for users I think in 2026. all of the flows that we talked about will be possible.

Can you talk about what has launched specifically right now and what is yet to be launched? Joe,

>> we're waiting kind of last week at 1:00 a.m. in Dev Connect for the ignition

a.m. in Dev Connect for the ignition chain to launch decentralized. So, we

don't run a single node. Uh the

community runs all its nodes. So, it's

very easy to run a node. So if there are people listening who are kind of home stakers um there are things you can do today whilst you're waiting you can go and help secure the ignition chain and and test it out. So you just need some

Aztec tokens and you can stake as a sequencer sequencer and validator at the at the same meeting on Aztec um and you will be elected for a committee and you can help produce blocks. The difference

between kind of the ignition chain and um kind of what's what's happening later next year is just that the gas limit right now is set to zero. So it's

actually the same full execution environment Aztec is built. Um we're

just waiting for some audits to complete and we want to ensure that you know as as one of the first layer twos that's launched fully decentralized. We want to ensure that everything runs as intended

on mainet. We've been running this on

on mainet. We've been running this on test net for for many months. Um, but

the final missing piece was kind of economics and making sure this works in in a mainet setting with spending actual ETH on gas and sequencers and provers

getting ASI tokens as as incentives on the network. And so the ignition chain

the network. And so the ignition chain is kind of that running on mainet. It's

been running flawlessly for the last week uh well four to five days now. Um

and uh yeah, at some point early next year, there'll be a governance vote by those sequences to turn on transactions and then all of these flows we talked about will be possible. So it's really

exciting to kind of see decentraliz decentralization in in action and see see this thing come alive. Um I think kind of we're targeting uh the audits to

be complete kind of early to midFebruary. And so that will be kind of

midFebruary. And so that will be kind of uh when the change fully goes live and and the gas limit gets raised from zero.

>> The first layer 2 to launch that's fully decentralized. Um what do you mean when

decentralized. Um what do you mean when you say that? I think when I think of a a layer 2 being fully decentralized, I'm thinking of layer 2 beat and it's gotten to maybe stage two, all of the

requirements there. And then if I'm

requirements there. And then if I'm thinking even beyond that, um maybe the full sequencing is also decentralized as well and that's fully permissionless for

everyone to participate. So, of course, layer 2's uh consensus happens on Ethereum, um I suppose, but they're using layer 2's use some sort of a a

sequencer to kind of order blocks and fully decentralized to me would mean also decentralizing the ordering of blocks into some sort of permissionless

network. But Joe, when you said that the

network. But Joe, when you said that the first layer 2 to be fully decentralized, what do you mean? What's your definition here?

>> Yeah, it's all of that and more. So uh

yeah, Aztec is uh I think of it as a stage two rollup. It's it's kind of not stage two cuz it doesn't have transactions. Um but it will be once it

transactions. Um but it will be once it launches. So we have we have

launches. So we have we have decentralized sequencing so anyone can be a validator. Um it's fully permissionless to sign up and be a validator. There's currently about 600

validator. There's currently about 600 validators on on the mainet and we should see many more come in over >> and a validator is a sequencer. those

are one and the same inte as someone who's staking. You're

sequencing when you're when it's your turn to produce a block and you're validating when you're helping other people make blocks. And the reason we have uh the distinction is because um we

as a as a layer 2 on Ethereum, we need to we need to basically submit the valid validity proofs to Ethereum every kind of 20 30 minutes. And that would be a terrible UX if we had to wait for that

to settle. And so the the kind of

to settle. And so the the kind of sequencers and validators can run ahead of Ethereum to give good UX to users.

And so you have these two roles that that kind of uh when you stake Aztec tokens, you fulfill. So that's kind of um on on the validating side. Um uh so

we take that box. The second kind of thing in in being fully decentralized in in my definition is decentralized proving. Um so a lot of chains kind of

proving. Um so a lot of chains kind of have maybe started to think about decentralizing their their validator set moving away from like a single kind of

team validator or sequencer um and that they still have a centralized proving uh system um so we also had to kind of decentralize that it's fully permissionless to the approver in the

Aztec system and then the the final kind of metric is around governance and ownership and I think this is the one that's usually forgotten like if you have the first two done But you know the

core team controls the protocol. They

can decide what upgrades happen. They

they decide um uh kind of what happens on the network and the community doesn't own the network. Then you haven't really decentralized. Um and so we've tried to

decentralized. Um and so we've tried to achieve kind of all three of those. Um

and the ignition chain is kind of that in in action. And the kind of ongoing token sale is our our attempt to decentralize the last one which is governance and ownership in the network.

So yeah, I think uh we are the first kind of fully decentralized there too.

And I think the reason for that is that privacy just shouldn't be owned by anyone. It's not owned by anyone on the

anyone. It's not owned by anyone on the internet. Um we kind of take that for

internet. Um we kind of take that for granted. Uh when we kind of use SSL

granted. Uh when we kind of use SSL transactions like this podcast is encrypted. Like the way we send this

encrypted. Like the way we send this information over the internet is it's not going over a public um connection.

It's it's encrypted. And so we want to make sure that um when this amazing kind of privacy comes to Ethereum, it's not controlled by one entity or one team.

And so we had we took decentralization very seriously as a result. H

>> how did you guys how in the world did you guys have the confidence to completely oneshot this? All right. So

um we've got you got all of these roll-ups right now going through stages of decentralization, right? And kind of graduating and it's taking a long time.

Part of the reason for this is there there could be bugs, there could be issues, you need some sort of centralized tax task force to step in and um you'll fix something. You know,

some of said the technologies right here now here Aztec is and you guys are oneshotting this all the way to kind of stage two where correct me if I'm wrong, but you you can't there's no security

council. You can't um shut this thing

council. You can't um shut this thing down. You can't um censor. You can't

down. You can't um censor. You can't

steal funds. like it's a decentralized network in the way Ethereum was at launch essentially and you guys are starting all the way there at the finish

line and basically leaprogging everybody. I I thought there were good

everybody. I I thought there were good reasons for this not to be oneshotted and for this to be some sort of progression and yet Aztec is starting at the at the end here.

>> I can feel that. I mean there's two things going on here. One of them is just the reason for this progressive decentralization narrative is fundamentally misaligned incentives. If

you have a fully transparent layer, too, then your value proposition is your transactions are cheaper and they're faster. Um, and this creates a bit of a

faster. Um, and this creates a bit of a race to the bottom because adding in decentralization, well, it makes your transactions slower and more expensive because you have higher coordination

costs. So, why decentralize? Um,

costs. So, why decentralize? Um,

especially if you're running an L2 and your sequence is collecting all the fees. Uh so there's a misaligned

fees. Uh so there's a misaligned sentence that we don't have an Aztec because we're a privacy network. We

really need to be a neutral a fully neutral um network where participation is permissionless where we're we're not like responsible for like forwarding and examining your traffic. Uh so the

incentives were aligned. Um and as you said, you know, Ethereum did it back in the day. So it's not not impossible.

the day. So it's not not impossible.

There are nevertheless um fierce technical risks that we need to mitigate um because we're fully decentralized. uh you know bugs. We can

decentralized. uh you know bugs. We can

fix bugs but it's not the fastest process in the world because we need to get our sequences to upgrade the network. And so we're doing this is why

network. And so we're doing this is why we're doing a phased roll out. Um you

know when when we we're starting with ignition, but when we turn on transactions um uh early next year that's going to come with a lot of health warnings. We're going to be very

health warnings. We're going to be very open and transparent about this that this network is not we cannot guarantee it's secure. We will have performed

it's secure. We will have performed extensive internal audits. We would have performed external audits. We will have done everything we can to ensure that it's secure, but we can't rule out the product stability of bugs. And the only

thing that really demonstrates a network is secure is time time in production where there are no bugs, where it's not being exploited. And so in the in the

being exploited. And so in the in the early days of the network, we're going to have a very generous bug bounty.

We're going to be very open about people saying, "Hey, this is like this is going to be a dangerous network for a while.

So don't don't go don't go nuts. Don't

don't don't ape in with with with all your money. It will be at risk." Um and

your money. It will be at risk." Um and then when we hit certain security milestones, um I believe they are if if we go 3 months without a critical or

serious bug report and we have 99% network uptime, we'll be like, okay, now we're comfortable calling this something more than just purely experimental. Now

we think it's a bit more it's a bit safer. But we're going to have it's

safer. But we're going to have it's going to be quite a quite a long rollup process before we are public saying, hey, this network like we have confidence in it in it is completely safe. You can do whatever you want with

safe. You can do whatever you want with it. That's going to take some time.

it. That's going to take some time.

What's nice I think from my perspective too is I don't I guess as a user I don't have to start by moving all of my assets uh essentially to Aztec right so the use case Joe you were talking about is

basically I could use kind of private intents to get privacy on a specific transaction and I'm only at risk of some

sort of um you know bug major failure in Aztec for a brief moment of time that would be different than storing my value on Aztec so that's kind of a nice way to

start and gives me the privacy effectively I'm looking for as a DeFi user without risking it all inside of an early network like Aztec. Am I

understanding that correctly? Yeah,

that's exactly what I was going to going to say is that like because we don't have these like pools of capital being built on on day one, um uh those kind of early users who are kind of bridging

funds through and the assets may end up on base or somewhere else as a result >> once they're out of Aztec again, they're they're kind of not um they're not at risk. And so uh you're only at risk kind

risk. And so uh you're only at risk kind of for that that period um whilst assets are in flight. The other interesting side as well um which uh we haven't

talked about yet is that for private smart contracts you can't see the funds that are inside them. So the attack surface of a fully private smart contract is actually reduced compared to

um a public smart contract because >> and a fully private smart contract Joe that would be something that was built uh natively on inside of Aztec using your VM your programming language. Yes.

>> Yeah. Correct. So there's kind of two types of applications that are quite safe at alpha. There's kind of, you know, fully private applications where the source of value is either native to

Aztec or it's off-chain value um or or kind of uh these inflight kind of privacy requests like bridging bridging kind of privacy to other L2s. The only

thing that's kind of very risky in the early stages is like large public balances inside Aztec because those could be right um attack services. Um,

so I think there's >> but the attacker doesn't know how much is in any of these things, right? So

they don't know to prioritize one versus the other. It would be much more

the other. It would be much more difficult for them to tell.

>> Correct. I mean, if there was a bug, they could potentially do this on on lots of private smart contracts. But the

the key thing about um Aztec native assets or offchain assets is that if the source of truth is is offchain, then like it's a bit like the USDC kind of situation with Ethereum. like if there

was a bug on Ethereum, um USDC can kind of choose where the funds are and so it's only kind of assets that are um Ethereum backed um that are very

susceptible to kind of uh bugs in the early days. So there's ways to also work

early days. So there's ways to also work around this uh is kind of where I was trying to get with this. And I think for the basic DeFi use cases as well. Um,

uh, you should be able to use this for kind of small to medium kind of like DeFi transactions, payments is a great use case like the the age-old, hey, we've been to Dev Connect and I want to

pay you for dinner. Um, we can suddenly start to do that without leaking my entire wallet history to everybody.

Incredible. [laughter]

>> So [gasps] those ones I think we should be fine within the days.

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more information. Other stats on the rollup itself. So this is a it's using

rollup itself. So this is a it's using ZK for privacy, but it's also a ZK rollup uh as well. So it's using it's not an optimistic rollup. So it's all ZK proofs. Correct.

proofs. Correct.

>> Yeah, correct. So we actually every user's transaction is kind of a ZK proof. Um, smart contracts can have

proof. Um, smart contracts can have private and public components.

Developers get to choose. Uh, the public component has its own kind of ZKVM and then those are all aggregated up into one single proof uh, that's submitted on Ethereum and once that proof's verified,

we get kind of the economic and uh, kind of censorship uh, properties of Ethereum for all of the Aztec transactions that were inside that. So yeah, we're a full full L2. um we we inherit uh all the

full L2. um we we inherit uh all the properties from Ethereum and uh that's one of the main reasons we we're on Ethereum is um that that kind of consensus and also the the kind of

capital and developers that Ethereum brings. So we're very Ethereum aligned

brings. So we're very Ethereum aligned here uh on the Aztec side.

>> In order to provide the privacy blanket for all of Ethereum, of course, you're going to have to support some throughput. some of these um layer 2s

throughput. some of these um layer 2s are are getting pretty high in terms of the the amount of transactions per second that um you know uh is available in those ecosystems. What sort of

throughput can the Aztec ignition chain support? Are you in the the hundreds of

support? Are you in the the hundreds of transactions per second?

>> Uh not not yet. Um [laughter] so this is this is one thing where like well things are going to get much better over time quite quickly because our focus right now is on launching and on security. Um,

so we're not we're not at 100 TPS yet.

Uh, but there's no fundamental reason why we can't scale to that with um with engineering improvements alone inside the network. Get getting beyond 100 to

the network. Get getting beyond 100 to getting to thousands of TPS that will be challenging as an L2 because privacy does increase kind of um coordination costs because your the data that you're

broadcast like you're broadcasting is now encrypted which means there's more of it. uh you know the transactions have

of it. uh you know the transactions have zero proofs which need to be verified which makes peer-to-peer coordination a little bit harder. So, we're never going to hit thousands of TPS like on the L2.

But this is where uh the AIC stack comes in, which is something that we are going to be developing with Gusto uh post launch basically because our network because of our private state model. Um

if you have a block that just has private transactions because we're we're a hybrid system. So, you can have private and public stuff, but if you just have private transactions, >> uh that block can be computed with massive parallelism uh because you don't

have any race conditions. you don't have multiple transactions modifying the same state. And so in theory, you can process

state. And so in theory, you can process those blocks extraordinarily quickly, particularly if you get rid of the overheads of sequencer coordination of data availability and posting to blobs.

And so something we're going to be doing is effectively building out an application specific rollout stack. So

if you are building an app where you have some trust assumptions like let's say you're doing microp payments or you know aentic AI payment systems where you know the values are very small, you still want privacy uh but you're willing

to trust a centralized segment. you're

willing to like let somebody handle data um as a third party. The idea is that you can build your application with Aztec's tooling. Uh but when you deploy,

Aztec's tooling. Uh but when you deploy, you don't deploy to Aztec, you deploy to some, you know, locally hosted entity uh as a as a effective in L3. Um and then

you post your you settle your locks onto Aztec. Uh and so you kind of get the

Aztec. Uh and so you kind of get the best of all worlds. you know, you get full privacy, you get very fast transactions, uh very fast transactions, but also you can get private on and

offboarding into your network um via the Aztec LT um which if you need privacy, you probably care about uh and so that's our plan for tackling like the very high throughput application use case. So will

that be the main constraint? Uh let's

say this is maximally successful, right?

So 12 12 12 months from now there is that button inside of my my favorite uh crypto wallet to send uh this transaction or execute this this trade uh with privacy and it uses Aztec right

I imagine that that could be very popular if you're if this is across all of Ethereum and if transactions per second are not yet in the >> measured in the hundreds u there could

be some congestion there and as we've seen on other chains congestion of course um increases fees I imagine maybe a similar you like um

thing would happen with with Aztec where okay if it's a $10 transaction over dinner I don't necessarily want to care about paying a dollar to Aztec for

privacy of this transaction but if it's $10,000 maybe that matters a lot more to me and I'm willing to pay a few dollars and so my transaction goes through because I'm willing to to pay more fees

but you know this would be a similar situation that Ethereum has found itself in which is it's kind of a victim of its own success and what it has to do is is scale. Is that similar to how you expect

scale. Is that similar to how you expect things to play out on Aztec in a success type of scenario?

>> It's exactly the same. Uh so like on on the fee model we've we've implemented it's it's the same EIP559.

So, you know, the base fee will increase once we get above a certain kind of um congestion limit for for each block and uh under the hood, you know, the the

token is burnt as a result um to try and regulate uh kind of supply and demand of of kind of Aztec transactions. But yeah,

if we you know, if it turns out that 50% of all of L2 users want privacy on their transactions, then we need more space.

Uh but that's that's kind of um I think is a is a good problem to have and you know we'll be able to scale that uh in different ways as we start to kind of um address that. I think right now I think

address that. I think right now I think actual like it's unclear how much of the L2 transaction volume is real transactions

versus kind of um kind of uh just like random transactions. And so I think we

random transactions. And so I think we could also see Aztec as like a proxy for like where are the real users on Ethereum actually transacting um doing things that require privacy. And so um

yeah I think we could run to that limit but I think it's probably more than we think it is right now.

>> Right. So that limit could be this this could mean um just high value privacy transactions are the thing that goes through um Aztec. So the Aztec layer 2 as well it's not EVM correct. It's it's

something that you guys have developed from the ground up. So maybe uh talk about that for a moment. It's not as simple as if I was to take sort of existing a code on the EVM. I wouldn't

be able to redeploy that as a smart contract. I'd have to rewrite this in

contract. I'd have to rewrite this in war. Is that the the programming

war. Is that the the programming language effectively? Can you talk about

language effectively? Can you talk about the VM? So you're right. You would have

the VM? So you're right. You would have to rewrite it in what? And so this this kind of this very much influences who we're targeting as our first um like users, developers of the platform.

basically uh people who are building applications that need privacy because uh the the thing about privacy is that uh the model for programming a blockchain changes radically because you have

private states and encrypted information that you need to work with um and you need to be sensitive about what gets broadcast what doesn't get broadcast and so the the metal model has already

slightly shifted uh and so I don't believe that uh requiring to learn a new language is actually that much of an additional like uh barrier to inertia

uh because um it's rust like it's pretty it's very easy to use um uh and it's just a mental model of like oh it's private now uh requires a bit of

thinking about um so with Aztec the for private parts of like transactions um we don't actually have a VM at all what happens instead is that your program that you're writing in gets directly

converted into a zero knowledge circuit uh and then um that gets um uh and then that gets like when you're executing a transaction, right? Like your your smart

transaction, right? Like your your smart contract address is def is derived from that circuit verification key. And so um uh yeah, you don't actually need a VM uh

for the private stuff. Uh and that's a choice we made to maximize um speed and efficiency because these proofs that contain all the sensitive data, you need to make them locally on your device. Uh

so we're talking about potato hardware here. Uh and VMs add overheads that we

here. Uh and VMs add overheads that we didn't want to pay. Uh um so uh yeah it's a it's a very different design architecture to other LTS.

>> Well what are some of these um totally private native applications that uh you guys are working with at launch? Well,

of course, the big value proposition for everyone listening who uses crypto and uses Ethereum, uses DeFi is Aztec is through kind of private intents uh potentially able to provide privacy for

all of your transactions, everything you do. And then also there will be some

do. And then also there will be some Aztec native applications that you're talking about that are you just full stack privacy. What types of things can

stack privacy. What types of things can you imagine here and what what types of things are maybe people working on? The

mental model I have is, you know, what we have on public Ethereum uh was designed in a pure public execution environment. And when you add privacy,

environment. And when you add privacy, you get a much larger and very different design space. And so the types of

design space. And so the types of applications we're seeing that kind of, you know, require privacy, they don't they can't exist on other chains. So

they they look a bit different to um perhaps what you see on on Ethereum or or other L2s because it's just not possible to make them there. The ones

I'm most excited about are um I think both in the trading side. So dark halls and OTC desks. Those are kind of types of like dexes that you know if you were

to build a DEX that requires privacy. Um

you may not build a constant product market maker like unis swap. Like that's

a fantastic mechanism for a public uh kind of uh execution environment but if you you have kind of complete complete privacy you can do things very

differently. um and OTC desks and kind

differently. um and OTC desks and kind of uh traditional financial kind of um uh order book style exchanges work very well in in that context. So we have a

few teams building different types of decentralized exchanges where the you know either you're hiding the participants of your trade uh or you're hiding kind of the the total flow going

in and out of an exchange um or just recreating kind of OTC desks. That's

that's one area. underclasserized

lending and consumer finance is the one I'm most excited about though. I think

for a long time on on Ethereum, we haven't had um proper consumer finance.

Um some teams have tried this um but it hasn't really taken off because what I can do, you know, in in most western financial ecosystems is get a loan based

on who I am, like the inflows and outflows of my bank account. Um, and in order to do that on Ethereum, I have to put that information onto the blockchain. As Zach was saying earlier,

blockchain. As Zach was saying earlier, that's a credential. Um, like I want to be able to create a credential which says my income is above 5K, my outgoings

below 2K, and I have a certain creditworthiness. And you can start to

creditworthiness. And you can start to do that on on Aztec by feeding kind of bank statements into a zero knowledge proof, proving information about them.

And then as a result, you can do underclaturized lending like a loan based on me being Joe, not a loan based on me overclasserizing ETH into a CDP uh

like we get with kind of traditional DeFi. So it's just a different um mental

DeFi. So it's just a different um mental model and I think one that's more centered on around either information asymmetries or kind of identity being a core part of the transaction. So those

are the two I'm I'm most excited about.

Um there's also a lot of games being built as well which are really exciting.

Part of the power of the ZK technology as well is um as we were talking about in the ZK passport uh use case earlier is the ability for me to selectively disclose some of my information and this

could come into play with uh financial transactions as well. So, I'd imagine if I did do that trade from ETH to USDC and, you know, years later, let's say

the IRS and I had some dispute. It said,

you know, I had different numbers than what I was declaring maybe in my income statement. Be very nice for me to be

statement. Be very nice for me to be able to say, "Nope, I have ZK proofs. I

I can selectively disclose that this was the trade amount on this date." And you could see I'm I'm right, IRS. Um, does

that ability exist within the Aztec ecosystem? Can I disclose things for

ecosystem? Can I disclose things for compliance reasons or to third parties for whatever reason? Is that fairly easy?

>> It's possible. We still need to get build out uh the tooling to make it easy, but it's possible. Uh and and the intention is to there's no reason why it shouldn't be easy. Uh the hard part is

then the getting the to go, oh yes, I accept this proof and not saying, "What is this random junk you've given me? I

don't care about this. I need I need a balance sheet." So that's that's going

balance sheet." So that's that's going to be the real battle. um you know uh because you can do so much like better than the existing financial system with blockchains with privacy where you know

you can do basically do preemptive compliance. So normally the way the

compliance. So normally the way the financial world works is you want to do a transaction you you perform your transaction and then you gather up all your paperwork to say oh yes I'm not a terrorist I'm an archist and then you

send it off to the off to the regulator and that is terrible model doesn't work because you're it does like there's loads of illicit activity happening in the real world and on chain you can do

things much better you can say by definition the only way this transaction can be executed is if me and my counterparty are following the rules are compliant you know Zika passport or whatever but using ZK proofs. Uh the

problem is that we don't live in a world where that's actually accepted as being valid regulation. Like the regulator

valid regulation. Like the regulator will be like, "No, I want to see everything. I don't care about these

everything. I don't care about these proofs." So, we got to get that to

proofs." So, we got to get that to change. Um but building applications and

change. Um but building applications and demonstrating this tech works is step one.

>> Um to to slightly circle back like R, you asked earlier about like an example transaction flow over how this works and I'd like to just to to to highlight one because you know this podcast is called bankless, right? So, let's talk about

bankless, right? So, let's talk about how a DBank might work on Aztec. So

let's say uh there is a there is an organization that is putting say um I don't know like mortgages or equities or some kind of real asset. They're putting

it on chain uh and issuing um issuing like liquid tokens that are being traded in a in a in a dark pool in Aztec uh and I want to use my DBank app to buy some.

I have some private USDC uh and I want to to buy it. So what would happen on chain right is um the entry point would be my account contract uh and um because we have account abstraction this account contract instead of having a public

private key and checking the checking a signature it could say check the Google uh authorization flow so basically I'm signing in with my Google account and um you know Google does gets a request that

you want to log on which is a slight centralization factor uh but nobody on chain looking at your transaction can see that this account is linked to a Google account. Once that happens, your

Google account. Once that happens, your transaction gets forwarded to uh the darkpool contract uh which will then um in trigger a uh trades between your USDC

contract and this um let's say this like real world asset contract and then that real asset contract will say well hm who's this person are they allowed to hold this asset like they need to be they need to prove they're American for

example so then that contract make a call out to an identity contract like CK Passport will just say hey does this person have an NFT that that that gets issued if um uh if they have a USD

passel proof and then you'll be like yep they do uh that gets returned all back to the dark pool the dark pool then call like triggers the token contracts exit the trade you you lose your USDC you

gain your real world asset token and then the transaction ends and that is all an atomic singular transaction for the user right um where the the the

proof of being generated client side and just executed in one shot and sorry for rambling but the one last the One last thing is what does an observer see looking at the blockchain? What do they see from all this? They don't know who

you are. They don't know the smart

you are. They don't know the smart contracts you're interacting with and they don't know what data you've modified. So, they see absolutely

modified. So, they see absolutely nothing. Very cool. And Zach, since you

nothing. Very cool. And Zach, since you were talking about kind of regulators and this being actually uh in many ways an improvement uh from the existing system of regulation both for for users

but potentially for >> compliance officials and regulators as well. Um can we talk about this for a

well. Um can we talk about this for a minute? Um they don't yet understand

minute? Um they don't yet understand privacy in crypto. Okay. And um there have been many cases that uh we've seen recently. Uh you guys were referring to

recently. Uh you guys were referring to the tornado cash developers. Um there's

some privacy devs in the Bitcoin community who are actually facing prison time. I know it's a different model,

time. I know it's a different model, completely different sort of thing that we're doing here. Uh but even tornado cash I mean there's intense regulatory scrutiny at the nation state level for

anything involving privacy and financial transactions.

>> How about you guys? Do you do you like are you concerned about this? I mean is there a level of like >> we live in fear that regulators and the nation states might not understand what

we're trying to do here and might um persecute us, prosecute us in some way.

And [clears throat] have you ever considered like giving up this project as a result of that? I I

just from my perspective I do not yet see any bright lines and maybe you guys do but um it feels like nation states

are very much trying to figure this out.

and uh even even those that bend in the direction of freedom and you know civil liberties may make mistakes on the way to getting there and it could be

catastrophic for crypto privacy developers involved. How do you how do

developers involved. How do you how do you guys think about that?

>> I think like the bright lines we have is that um privacy on on blockchain should be the same as privacy on the internet and you know we take that for granted today. Um but that was a battle that was

today. Um but that was a battle that was fought and won by in the last privacy wars um around SSL and Netscape were kind of pioneers in that in that regard

like getting the the privacy we we enjoy that powers most of the internet was not just a kind of you know walk in the park exercise. It was something that um was

exercise. It was something that um was fought for and and won. And so I think as a result we now can enjoy card payments on the internet like accounts that have passwords. um most of the

internet under the hood is powered by a form of encryption um under SSL certificates. And so I I view it very

certificates. And so I I view it very similarly to to to kind of that debate and there's always going to be push and pull uh with with regulators. I think

the reason why things got um kind of uh dicey and kind of people were were kind of prosecuted um when we first had this technology is because we had a very weak form of it. we had a very small

sprinkling of privacy. Um all we could do was encrypt um a balance and and basically hide it from the world. And

that in its own is actually quite dangerous because um you can't do uh the important thing which is tie your identity to that cryptocurrency account.

So I think now that we've got to kind of like hopefully a a higher degree of functionality, we've we've kind of gone to like a hopefully a local minimum um or maximum in terms of what you can do.

I think it's actually more useful to be able to convince regulators that um you know this is actually a force for good, not not a force for for bad. And you

know teams like Zeke Passport um can help convince them. Ultimately, it's

going to be up to application developers though. Um some some apps will require

though. Um some some apps will require very strong degrees of um compliance and regulation based on what they're building and others may not. like if

you're building a low value game um that's just kind of you know cryptokitties like you need a very different compliance tool chain than if you're kind of trading kind of equities

um on on a public blockchain and so the goal with Aztec is just to make a kind of neutral infrastructure layer that powers all those use cases and gives developers the the tooling they need to

make those decisions and so I think that making it be neutral and um kind of not compromising on on on that fact that we don't control the network is hopefully how we win because it means that the the

nexus point is on the application developer not the network and I think that's how Ethereum survived um all these years as well with teams like tornado cache like Ethereum wasn't the target it was it was the application

>> well yes but also we want to make sure that you know application developers can can build in the tools and resources to protect themselves uh you know um ultimately uh >> yeah 100%

>> um to directly answer your question right you asked basically am I worried I'll are we worried that regulators won't understand the technology we're building and come after us that is no

I'm actually worried that regulators do understand what we're building and they come after us because uh I think the last few years have shown us something is that regulators can often act in

extraordinarily bad faith that you have the the dour uh mandate of a regulator which is to protect consumers which is very legitimate and then you have the de facto mandate of the regulator, which is

in my opinion to protect um incumbent economic and financial elites. And this

is why the Genza regime was so hostile to crypto. It's because of was a threat.

to crypto. It's because of was a threat.

I mean, you can even see with the Genius Act, right, where um banks were doing that absolutely damned us to try and make that stable coins unable to pass on um treasury yields to to the stable coin

holders. And they're they're absolutely

holders. And they're they're absolutely insensed that um products that achieve the same outcome are being developed. uh

if ASEX succeeds, you know, it's creating a network where the barriers to entry for providing financial services crush through the floor. You know, you no longer need these giant um

information notes, uh enormous pools of capital, um access to elite elite um uh elite networks of of of knowledge and privilege. Instead, you can build these

privilege. Instead, you can build these these decentralized financial systems on Aztec that compete directly with the centralized versions uh where you can get your equity uh from uh from the blockchain network. You can get your

blockchain network. You can get your market from the blockchain network. You

get distribution basically without having to count out of financial elites.

And uh I think if we're successful, they're not going to like it and they're going to address up their concerns uh that with in the language of privacy and safety when in reality what they're upset about is that they're losing money. That's my concern. Are you

money. That's my concern. Are you

prepared? Are you guys prepared? So, if

that concern is, you know, strong enough. I mean, I think there's um

enough. I mean, I think there's um it's a scary time for open source privacy developers. I mean, does that

privacy developers. I mean, does that ever keep you up at night?

>> It makes me more angry than scared to be honest. I think that um you know, we

honest. I think that um you know, we we're [laughter] we're doing we have unfortunately we have a lot of precedent um we can observe to

uh to guide our actions um very unfortunately. Uh so I I think that um

unfortunately. Uh so I I think that um you know we are like uh it is going to be a very very tough battle for anybody

to come after Aztec because we're doing everything right. Uh and you know um you

everything right. Uh and you know um you get some really dark precedent set. Uh

if some some judge wants to claim that there's no legitimate use case for something like Aztec, you can very very easily extend that to saying there's no legitimate use case for the internet. Um

I'm not worried personally. uh you know I just think that this is I said this years ago that this is going to be a long grinding battle of attrition uh they where there's too much value on the

table to destroy this technology to destroy blockchain to destroy privacy there's too much value on the table and the first like trusted uh like environment that actually embraces this

is going to is going to generate so much advant economic advantage that the others will have to fall all the other jurisdictions will have to fall in line.

Um, and so there's this basically this is golden goose laying golden eggs on the table uh that um uh incumbents will try to destroy, but it only takes one of

them to pick it up and go actually I'm going to I'm going to I'm going to start using this for myself and make my myself and everybody else will have to fall in line. Uh and the question is what is the

line. Uh and the question is what is the collateral damage going to be until that happens? Uh our job is to make sure that

happens? Uh our job is to make sure that both ourselves uh the network and our networks users and builders stay out of it. We'll see how successful we are over

it. We'll see how successful we are over the next 5 years.

>> Completely agree. Uh well said and and well done. As we maybe draw this to a

well done. As we maybe draw this to a close, I'm I'm sort of interested in a lot of things about the Aztec journey, but one of the things that intrigues me the most is um how long you guys have

been doing this. So, this has been really an endurance race. And I think we're in a world right now in crypto that feels uh somewhat jaded by short

termists. Um like it's kind of like

termists. Um like it's kind of like where have all the cipher punks gone, right? I thought this thing was about um

right? I thought this thing was about um rebuilding something new. Uh Zach, you are an exarticle physicist I believe. Uh

Joe, you are prim formerly a material science scientist, right? So you got into crypto, I think from other fields

for a reason. uh you've been working on this project for seven to eight years on Aztec and we haven't gotten into all the the the commotives of the tech stack but

there's so much here that is net new and um huge advances in the area of cryptography and and ZK in particular that I know you guys have built

yourselves but this has been a almost a decadesl long journey already and we're just getting to the the starting line

now with the [snorts] um Aztec ignition chain. I guess my question to both of

chain. I guess my question to both of you is like what's kept you going and like what keeps you here now? Maybe Zack

going is honestly what else is there? Uh

what else is there? You know, like if if if I left the space or pivot into some random piece of junk that I didn't believe in. Um then it's like what's

believe in. Um then it's like what's what's it all for? you know, uh um uh this this project is is I like I I drive a lot of meaning and purpose for this

project because I can see I can see a world that could exist that needs to be pulled into reality and I feel like we're so close and we've been so close for years. Uh as in why would I give up?

for years. Uh as in why would I give up?

As in to do what? Like what else would I do? Um [clears throat] this is this is

do? Um [clears throat] this is this is this is the this is the opportunity of a lifetime. I wouldn't like I I wouldn't

lifetime. I wouldn't like I I wouldn't trade it for anything. Um, yeah, the way I see it, it's it's do or die. Do or

die.

>> Yeah, I think I think about it similarly, but but but a but a bit differently as well. I mean, I I kind of view it as like the promise of this technology like bringing the world on

chain uh without strong privacy is something that terrifies me. And I think I I think we have a real chance at preventing that future like this

dystopia where you know the an MEV bot or some some kind of AI agent knows what you're about to do before you've done it because they've seen all your future and previous transactions and they can just

predict every every move. Like if we're going to try and like meaningfully try and on board like all of the unbanked people in the world to use crypto rails and we're going to take away something we enjoy in the western world which is

basic privacy like I can't see your bank account like when I go to a shop and pay for something they can't see how much money I have or like what I did last week. I think if we're going to if we're

week. I think if we're going to if we're going to do that and that's the world we're trying to kind of um uh kind of put into existence here and we do it without privacy like like what are we doing? And I feel like compelled to

doing? And I feel like compelled to protect that and try and kind of protect the people who are ultimately going to be users of of those chains um who may not know the difference in in the short

term but we'll have their data kind of you know extracted a mind if if something like Aztec doesn't exist. So I

think it's more kind of you know this there's a lot of scope to have a lot of impact with this project but also um I think I feel compelled to kind of try and do something about that because too

many projects just put their users data on chain and you know we'll see in 5 10 years when it's all hoovered up um you know what the effects of that are and I think that's just not a world I really

want to see exist. So that's what keeps me going. crypto without privacy is

me going. crypto without privacy is actually a scary proposition and uh we certainly wish you well. There there are many ways to get involved with this project. Um one of the ways right now is

project. Um one of the ways right now is there's I believe a a token sale going on if people want to actually participate in that uh get involved in the network. They can also use those

the network. They can also use those tokens to become sequencers. As we draw this to a close, can you talk about how that works effectively? So let's say I want to learn a bit more about this.

Maybe I want to participate in the token sale. Maybe I want to, I don't know, run

sale. Maybe I want to, I don't know, run some infrastructure, become a sequencer.

What do I do, Joe?

>> Yeah. So, we we looked at the ways to kind of bootstrap this network and um not many of them kind of were fit for purpose. So, we we ended up partnering

purpose. So, we we ended up partnering with Uniswap on a new uh kind of distribution auction model. It's called

a continuous clearing auction and it's designed to kind of prioritize fair access to kind of token sales. Like

historically with token sales, you know, they can be sniped by whales or um they kind of, you know, the price discovery doesn't really exist. And so Unisoft and

us have built this um this new type of auction that prioritizes fair access um and it it will at the end of the auction uh kind of find a fair price for the AIC

token. It creates a unis swap v4 pool at

token. It creates a unis swap v4 pool at that fair price and everything's on chain fully transparent for >> on Ethereum. The tokens are on Ethereum layer 1. Okay. Yeah, it's a Y20 on

layer 1. Okay. Yeah, it's a Y20 on Ethereum mainet. The allocations,

Ethereum mainet. The allocations, everything happens in smart contracts on Ethereum mainet. And so you just have

Ethereum mainet. And so you just have have to head to our website uh to take part. You can either do ZK passport

part. You can either do ZK passport proof to prove you're not on a sanctions list or traditional kind of KYC um and then you can send your ETH to a smart contract and place a bid as a result.

Once the auction's over, you'll be able to claim your tokens out out of those smart contracts and you can then stake them. uh you'll need 200,000 tokens to

them. uh you'll need 200,000 tokens to stake. If you don't receive that many,

stake. If you don't receive that many, you can still participate in governance uh on the network and kind of vote for vote for changes. Um but yeah, you need 200,000 tokens to stake. You can either

do that yourself on kind of a homestaking machine. Um the hardware

homestaking machine. Um the hardware requirements are fairly uh fairly kind of um easy on consumer hardware or you can delegate to um some of the existing

kind of lists of of of stakers. We have

about 200 Genesis uh kind of uh kind of entities who accept um kind of deposits from other individuals and so you can stake that way as well much like Ethereum staking works. You can either

do it yourself or you can you can kind of delegate to a third party and so yeah it's all running on Ethereum mainet and the goal is to really distribute ownership of the network and governance

to the community. Um and uh as a result kind of uh yeah we're doing this this token sale. I think one of the other

token sale. I think one of the other interesting things to to note is that um the liquidity for the token sale is put into a unis swap v4 pool and the community actually gets to decide when

TG occurs. So the core team everyone is

TG occurs. So the core team everyone is kind of has a lockup uh but the community tokens uh that are purchased in the sale will be the only tokens that are 100% unlocked at at TGE and the

community gets a vote on that. Um, so

it's kind of doing things the right way, uh, decentralized governance, uh, on Ethereum mainet. So it's been a lot of

Ethereum mainet. So it's been a lot of work, but it's been really cool to partner with like one of the like original DeFi protocols, unis swap, to to make a new way of doing token

distributions because we we don't think the whole uh, airdrop meta was uh, fit for launching a decentralized network, especially when people need skin in the game to to stake and run notes.

>> And Joe, I can run these nodes from home. I can run a Aztec sequencer from

home. I can run a Aztec sequencer from home. Yeah, you've got a DAT node. Um,

home. Yeah, you've got a DAT node. Um,

they're they're kind of uh there's a package on the DAT node app store. You

can run it alongside your Ethereum validator. Um, which is kind of a great

validator. Um, which is kind of a great way to do it. So,

>> secure Ethereum.

>> I got to tell you guys, >> you know what, just when I was getting jaded in crypto again, this is the most cryptonative project uh I've seen probably in years. You guys are doing this bottom to top and uh I give you a

lot of credit for this like in you like new territory new frontiers just about every particular area layer 2 privacy even the ICO and distribution this is

really a unique project so I'm hoping the best uh for it and I'm very excited about the the launch and then getting finally to I guess so this is sort of a beacon chain type of mainet and then

what are you calling the main ignition mainet is that actual mainet It's going to be called alpha. And then

once we've Yeah. Once we've run that with the kind of um >> security and uptime requirements Zach was talking about earlier. So hopefully

3 months in, >> we'll call it a bit like still in beta.

>> Okay. [laughter]

>> Well done. Thanks a lot for spending the time with us today. This has been absolutely fantastic. Zach and Joe, um

absolutely fantastic. Zach and Joe, um we're looking for big things.

>> Thanks for having us on. It's been a pleasure.

>> Yeah. Thanks again. and we'll see you in 5 years. [laughter]

5 years. [laughter] >> Oh my god. Hopefully next year. I heard

a promise earlier, Joe. Got to let you know, bankless listeners, of course, none of this has been financial advice.

You know, crypto is risky, so it's a frontier of privacy. You could lose what you put in, but we are headed west. This

is the frontier. It's not for everyone, but we're glad you're with us on the bankless journey. Thanks a lot.

bankless journey. Thanks a lot.

>> [music]