foreign
[Music]
and this tokos original is supposed to
be held by our CEO but he decided to
escape through this burden is up to me
and I will talk how D5 is missing a key
primitive which is privacy and how Aztec
connect fixes it fixes it
so many of you probably remember that
last year there was this GameStop Saga
and basically what has happened
is that this information about The Big
Short position of one hedge fund leaked
and then since internet is kind of
random like people decided that it would
be fun to just ape into the stock and
pump the price and the fund got
liquidated
and this was caused by the fact that
like the information leaked
and so the situation in web 3 is even
worse like
basically anyone who is able to use a
web browser and
can go to Ether scan and search like
what anyone is doing
and this is made even worse by people's
views of ens so we can see quite
commonly that people use their ens names
with trading because they apparently
have no idea that is not private
and to drive this point home like
basically there is this ensname docs.if
and if I want to spend some time on it I
can just like basically figure out
that the user has units web position I
have a position and how amount of USD
available for collateral
and you might be asking why this is bad
because like plenty of the times it's
considered the transparency is like a
nice feature but when we are talking
about financial information it can be
bad because like it allows basically
anyone to assess solvency of any entity
on ethereum and this information can be
used by adversarial parties like Mev
Bots
and then there is also of course a risk
of doxing and consequences in the
physical world this can be as innocent
as your friends
shaming you for your bad trades but it
can also make you a target of crime
so the solution at Aztec we think that
the solution are privacy preserving
roll-ups
and our privacy preserving group is
called Aztec connect it is live on
mainnet
and we like to call it VPN for ethereum
and I think this is quite a nice mental
model because essentially what VPN is
doing in the webto world is that it
replaces your IP address with the IP
address of the VPN provider and
essentially what we do is that we
replace your ethereum address with if
ethereum address of Aztec
so I wanted to show some demo but of
course it's not very possible here so I
will just show some screenshot
so this is our website ZK money and when
you come there you can click Shield
and then you can choose an alias this is
like an analogy to
ens name on ethereum mainnet
then we will create your account this
will take a while because there are some
complex computation happening behind the
scene
and then you deposit the amounts of
funds
and behind the scene that actually
happened quite a few things that
happened two transactions on ethereum
one deposits the funds into a royal
processor contract another approved this
approves this hash and then there is
like a generation of cryptographic note
on L2 and this cryptographic node allows
you to spend those funds
so once you deposit this is what it
looks like it's like a normal wallet
and then there are opportunities so you
can deposit into an arbitrary Bridge
we've implemented
so for example if I deposit to Euler I
have this screen and there are quite a
few interesting things here which I want
to explain first one is a batch
so there is quite an interesting feature
to us the connect and that is that we
allow for this thing called patching and
basically what it means is that when
there are multiple users which want to
do the same interaction on ethereum L1
we basically do only one interaction on
L1 and on the inputs of the interaction
is like a sum of those token amounts so
basically when there are like 10 users
which want to deposit each to Lido and
let's say for Simplicity each user has
one if we only call the stake function
on Lido contract once with the 10 ether
and then later on WE distribute the
results to the users and in this case
like the results would be the output
tokens which is staked
yeah I would like to briefly pick what
is behind the scenes and we use utxo
model it was talked about by quite a lot
in the Aztec 3
presentation before but basically what
is a utxo model is that you can imagine
when you have banknotes and you want to
go to a merchant and you want to pay
with the banknote
so what happens is that you can like
split this banknote but you give the
merchant the banknote and he gives you
the money back and this is essentially
what we do as well and we do it with
this thing join split circuit and
essentially what this allows is that you
have two possible nodes on the input
which get destroyed in the process and
then there are two nodes on the output
and for example in the example of of the
bridge interact of the D5 deposit to
Lido uh on the input would be for
example 0.5 if and in case the original
value held in your account was one note
with one if
this node would get destroyed and on the
output would be this claim node and
another volume node that value node
would hold the remaining heat balance so
it would be 0.5 if and that claim node
would allow you to later on claim the
funds
resulting returned from the defy
interaction
yeah
so you might be asking how is this
possible that like this is private when
the settlement like the interaction
actually happens on ethereum
and this is a good point and uh here in
the left bottom corner we can see what
it looks like like what token transfers
there are
and this looks pretty not private but
the thing is that thanks to zero
knowledge proofs nobody can distinguish
like who is actually originated this
interaction and also there is this
aspect that there can be multiple users
per interaction
and so these balances get even more
obfuscated
and currently there are more than 50 000
unique users last time I checked it was
like 51 000 something
and it means that like the amount of
people you get height with is spiritual
Arch
you might be wondering does it scale
roll up is quite a common password and
it does scale and one reason why it
scales is because there is that one L1
transaction per
multiple users
but of course everything is always more
complicated and there are overhead costs
to roll ups
and this costs are cost of posting
overall up and per transaction cost of
call data
luckily this cost of posting a roll up
gets split between many users so when
there are many users in develop this
goes down and the cost of call data is
fortunately going to down a lot with
this ethereum Improvement proposal for
844
so hopefully like in a not so distant
future the cost of interacting privately
with D5 will actually get very close to
the gas cost of that one L1 call divided
by the number of users
uh now you might be wondering like how
do we integrate is there like some
integration needed
and unfortunately yes but it's not so
complicated and we have this thing
called Bridges but Bridges nowadays have
quite a bad connotation
and in our case the bridge is just a
simple smart contract so there is no
multi-stick risk and the smart contracts
tend to be fairly simple
so here on the left we see the ID
vibration interface and there we
basically just Define input and output
tokens then we have total input value
which is the sum of those two users
input balances and aux data which is
arbitrary data which can be used to pass
to the bridge contract
and on the bottom right corner we can
see the implementation of the con of the
function itself and in this case it's an
implementation of an erc4626 bridge and
we see that it is like a relative we
basically just call deposit if deposit
flow is executed or we call redeem in
case
withdrawal flow is executed
now you might be asking if there are
some limitations
and there are quite a few I would say
the biggest one are the longer
settlement time and that is because when
you
you we have to wait for the batch to get
submitted to
to ethereum
like luckily you can pay if you are
really in a hurry so you can pay for the
full roll-up block and in that case you
could get the instant settlement time
but most users don't want to do it
because it's fairly expensive and this
causes like some problems with slippage
so for example you can imagine when you
trade on uniswap you define a slippage
parameter which basically protects you
from
Mev Bots exploiting you or in general it
can protect you from Market movements
and the longer settlement time can also
cause issues with liquidations because
you can imagine if we are close to being
click related and you need like fast to
exit the position or something in the
that is problematic but always you can
pay for the instant settlement
then there is the limitation by the
amount of data which can be on the input
like most of the time this works quite
fine because it's 64 bits of data and
with like a bit of smart encoding we can
actually put a lot of information there
but it can be problematic when we for
example want to pass in ethereum address
because that is 160 bits
then another limitation might be that
the system doesn't work that well with
esoteric tokens because those esoteric
tokens might have insufficient anonymity
sets and basically what that means is
that there is unlike one esoteric token
you user and he would deposit into Aztec
and he would be the only one like
working with the D5 protocols it would
be pretty obvious that is that one user
but in practice I think this is not that
big of a deal because usually users want
to use the high liquid tokens and I
don't feel personally that is such a big
limitation
then another limitation might be that
some Protocols are specifically designed
to work with message sender so for
example when when those protocols just
work with tokens you can imagine that
there's like token on the input and
token on the output which is for example
the case of Lido like this works
perfectly because there is no limitation
we just have tokens on the input and
then we distribute the results
but when the protocols work specifically
with message sender which can for
example can be when we are borrowing
LUSD from liquite
oh it's pretty
complicated to do the implementation and
how we've solved it is that we deploy
these multiple Bridges and each of the
bridge has fixed collateral issue
and like if the bridge was like close to
being liquidated user can't add more
collateral but the user can always repay
the depth and exit so even though there
are limitations usually there is like
some way how to work around them
now I would like to talk about
advantages and I think those advantages
are pretty huge because Aztec connect
doesn't need redeployment of smart
contracts on L2 because we work directly
with smart contracts on L1
and this means that for example
liquidity is not fractured and I did my
own personal experiment when it was blue
market and I checked like how much it
makes sense to do for example swept on
L2 and it turned out that for not so
large amounts like over five thousand
dollars even with the high gas fees it
still made sense to use ethereum L1
and that is because the liquidity was
just so much higher so the slippage
would be just so much slower that like
the piece would be worth it
and another Advantage is a lower risk
for integrated protocols and that is
since we don't need to the Target
protocols don't need to like redeploy
again on
on our L2
uh there is no risk for them like for
example the risk of fracturing liquidity
then I would like to mention that there
was of course 95 cases but the fire is
like a nice password so we mentioned it
here and I think very cool use case
could be private doll voting and that is
because in all the voting systems
privacy is very important and another
interesting use case might be nft
mending
yeah thank you for the attention
[Applause]
thank you John we still have questions
time for questions so here to the right
Nicole
ah yeah I can I can put that I can let
you know but I must put it allow
ultimate light before the presentation
yeah
um just a quick question uh how
expensive is here here sorry yeah you're
looking for me how expensive is each
operation because it seems like you are
doing complicated cryptography and
solidity
uh so on on ethereum L1 it was like the
same as I mentioned before like the
color itself and then there is the cost
of call data and processing the roll up
uh so is does it answer the question
like I I have to admit I'm not a
cryptographer I'm just like a basic
solidity engineer well as well so yeah
um so it's not very expensive a second
can this work on on alternative chains
like uh like other in other l2s like
having when it has taken okay so our
contract is implemented in solidity so
we can deploy it to any evm chain and
like our L2 infrastructure just uses
generic Json RPC so like there is no
fundamental issue why that would not be
possible but like an interesting note is
that it might not make sense because
usually those other l2s have also like
have to post the call data on ethereum
L1 so it means that if you for example
were running over optimism we actually
would not save much gas
we have one there on the left side then
there and then the third one
uh thanks for the talk
um you mentioned you have over 50 000
users
um on Aztec Network
um a couple questions like who has
integrated besides Euler
um like who's on the docket and like
what are those 50 000 users using it for
currently yeah so we have quite a few
Integrations I think the most important
are for example Lido Oiler than we have
for yearn
um we are working on unisfab click with
the
yeah we have a grants program where we
basically give some developers money to
build the Integrations
and yeah that's it and where are the
users are using it for currently mainly
uh
I think that like in general the farming
worlds are quite popular so we have
quite a few users of Ian and we've also
built this thing called DCA Bridge which
allows like users to DCA into eth or die
and it's also becoming quite popular
pci's dollar cost averaging for those
two you don't know
um I got the mic ready uh so uh one of
my my question was around what you're
doing to try to deal with this
settlement like waiting times and stuff
um and I was wondering if like as you
integrate with other protocols if that's
like a
breaks Community or brings in
composability challenges and kind of how
you're thinking about solving that in
the long run yeah so there are no
composable it is challenges because it's
running on ethereum L1 like the calls
and like the best how we can deal with
the settlement times is basically having
enough users that it the that it makes
that it's profitable to submit the
roll-up blocks frequently but as we said
if there is like some user with your
origin plan needs it to be settled he
can always like pay for those instant
settlement much does it usually cost if
it's just like one user or it depends I
mean when it's badged like
tour and play it costs like one dollar
to deposit into Euler
um thanks for the awesome talk
um one example you gave at the end was
like a private nft purchase does that
mean the nft will be owned by the Aztec
address
yeah exactly it would be on by the Aztec
address but there is this thing called
we don't currently like support nfts
directly in our UI but we have this
thing called virtual assets which
basically allows like a representation
of any ownership
so like on ethereum of course it would
like stay within ether within the bridge
it would stay within the bridge contract
but yeah the user could then interact
with it by using the virtual assets
virtual assets basically what it does is
that it like doesn't exist on ethereum
L1 but we create this
another value note on our L2 which
contains the information which can then
be passed to the bridge and worked with
so yeah though it would stay within the
contract on ethereum
um my question is uh can you do
scripting Logic on the L2 itself so like
not on a bridge but within the L2
or I mean it's not accessible to like
developers but it's possible to like
build circuits
but I mean it's not the goal of Aztec
connect it will be the
like we will have generalized smart
contract once Aztec 3 is available which
will be in a year or more
so like things like multi-6 on the L2
itself that's not really possible yet
attack actually there is an
implementation of multisig it works with
like those
account cryptography so yeah we have
multi-6
awesome thanks
more questions
and then here
test us up so the the always a fun
question about regulatory risk um
obviously this has like a sounds like a
mixing component similar tornado
um what are your thoughts about that and
uh that that that risk
yeah so currently how we approach it is
that we limit the deposit side size and
basically like our goal is to avoid the
use of hackers
avoid users hackers using our platform
and like the big issue with tornado cash
was that like 70 percent of the money
there was elicited so basically we are
just trying to make it impractical for
hackers to use our platform
what's the limit I think currently it's
like 10 each per deposit but we might
increase it in the future okay thank you
can you share a little bit more
um I'm over here on the front right
your 50 000 users can you give us a
sense of like before Aztec what were
they doing are they doing the same thing
just totally in public or as a result of
Aztec are they now doing things that
they previously weren't doing
oh I'm not so sure how to answer but I
would say it were like General like defy
users and they just wanted that privacy
so they deposited to Aztec
but I actually didn't do the analysis
we have four minutes more if you have
any questions you have John
has been really Brave to substitute the
CEO
congrats big round of applause
just prepare this thank you thank you