What Solana Needs To Fix | Max Resnick

Max Resnick's Move from Ethereum to Solana

In a recent episode of the Lightspeed podcast, Max Resnick, formerly of the Ethereum ecosystem, discussed his surprising move to Solana and his new role as lead economist at ANZA. This transition has stirred considerable discussion in the cryptocurrency community, with implications for both Ethereum and Solana's future development.

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Resnick's journey to Solana began with curiosity about the ecosystem, particularly its approach to MEV (Miner Extractable Value). His exploration deepened during a visit to Miami and attendance at Breakpoint, Solana's annual conference. What struck Resnick most was the contrast in development cultures between Ethereum and Solana, especially evident in their respective core developer meetings.

"I liked what I saw at Breakpoint," Resnick explained, highlighting the hunger and lack of complacency he observed in the Solana community. This energy, combined with Solana's potential, ultimately led to his decision to join ANZA, a developer shop spun out of Solana Labs.

The Cultural Shift: Ethereum vs. Solana Development

One of the key differences Resnick noted between Ethereum and Solana development was the approach to understanding and optimizing blockchain performance. He observed that Solana's discussions are firmly grounded in the realities of computer hardware:

"All of the discussions are happening in a place of how can we understand the way that a computer works and build a system based on that rather than building a system based on a mathematical model of a computer that is very lossy and doesn't actually represent what a computer does."

This hardware-centric approach, according to Resnick, allows Solana to squeeze more performance out of its blockchain by avoiding unnecessary abstractions that can cause performance issues.

Resnick's Impact on Ethereum Discourse

During his time in the Ethereum ecosystem, Resnick played a significant role in shifting the conversation around Layer 1 (L1) and Layer 2 (L2) scaling solutions. He expressed frustration with the prevalent focus on L2s and what he perceived as a celebration of L1 "going away."

"I thought it was problematic because there's very few of these decentralized execution environments in the world and one of them being abandoned in favor of what I view as centralized servers, sequencing transactions... was quite worrisome to me," Resnick explained.

His outspoken views initially faced resistance but eventually helped open up discussions about L1 scaling and the importance of maintaining a robust base layer. This shift in discourse has become more apparent on platforms like Twitter, where previously taboo topics are now openly debated.

ANZA: Solana's Core Protocol Development Hub

ANZA, where Resnick now works as lead economist, plays a crucial role in Solana's ecosystem. Similar to Consensus's early role in Ethereum development, ANZA focuses primarily on developing the Solana core protocol.

"ANZA's primary focus is the development of the Agave client. And that means that almost all the work we do is on the Solana core protocol that runs on the boxes," Resnick explained. This work involves improving and maintaining the foundation of the Solana blockchain.

Solana's Economic Challenges and Solutions

MEV on Solana

Miner Extractable Value (MEV) has become a significant concern in the Solana ecosystem, much like it has been in Ethereum. Resnick acknowledged the presence of malicious MEV activities on Solana, particularly sandwiching attacks. However, he noted that the current situation differs from Ethereum due to the centralized nature of transaction visibility.

To address MEV issues, Resnick outlined both short-term and long-term strategies:

1. Short-term: Improving slippage settings in applications and potentially reconsidering the public mempool to increase competition.
2. Long-term: Implementing multiple leaders to create competition for transaction inclusion, making it harder for malicious actors to monopolize MEV opportunities.

"If there's competition for who lands your transaction, now if somebody is a sandwiching leader, my option isn't either I don't get my transaction included this block or I include it with this malicious person. It's I include my transaction with leader A who's not malicious, or I include it with leader B who is malicious," Resnick explained.

Fee Markets on Solana

Resnick gave Solana's current fee market a "B or B minus" grade, noting significant improvements from earlier in the year. He explained that the fee market now impacts transaction execution at various stages of the transaction pipeline, from RPCs to actual execution on validators.

To further improve the fee market, Resnick suggests prioritizing transactions with higher fees at every stage of processing, including the signature verification step. This approach would create a more efficient and responsive fee market, better aligning with user priorities.

Slashing Proposal

A recent proposal to introduce slashing on Solana has caught Resnick's attention. Slashing, a mechanism to penalize validators for malicious or faulty behavior, has been notably absent from Solana's design until now. Resnick supports the introduction of slashing, particularly for double signing of proposal blocks:

"Without any slashing, the protocol is technically vulnerable to these adaptive bribery attacks. And so you really need slashing," he argued. The proposal aims to first implement slashing for double signing of proposal blocks, with plans to extend to double attestation in the future.

Multi-Leader Consensus: Solana's Path to NASDAQ-Level Efficiency

One of Resnick's most ambitious visions for Solana involves implementing multiple concurrent leaders. This approach, he believes, is crucial for Solana to achieve its goal of becoming a "decentralized NASDAQ."

The multi-leader system would allow Solana to handle market "jumps" - sudden price changes due to significant events - more efficiently than traditional central limit order books. Resnick explained:

"The only way to do that is to hold an auction. And the only way to hold an auction is to have multiple leaders. And so that's why I think it's like, actually necessary. It's not sufficient, but it is necessary for us to beat NASDAQ at their own game."

This system would create a more competitive and efficient market structure within the blockchain, potentially surpassing the capabilities of centralized exchanges.

Addressing Storage Pricing with Chili Pepper and Avocado

Solana's approach to storage pricing has been a point of concern, with inefficiencies in the current system. Resnick discussed two proposals, colloquially known as "Chili Pepper" and "Avocado," aimed at improving this aspect of Solana's economics.

The Chili Pepper proposal focuses on pricing the bandwidth between disk storage and RAM. As Resnick explained, "It's a way of calculating how much bandwidth each transaction needs from disk to memory." This system would help prevent scenarios where too many cold storage accesses overwhelm the network's ability to bring data into memory within a single slot.

While the details of these proposals are complex, their implementation could significantly improve Solana's efficiency in handling account data and storage.

Firedancer: Solana's Second Client

The development of Firedancer, a second client for Solana, represents a significant step towards increased resilience and performance for the network. Resnick sees the introduction of Firedancer as a positive development, fostering healthy competition and innovation within the Solana ecosystem.

"I think internally in the ANZA team, the performance metrics that have been coming out of Firedancer have kind of lit a fire under our ass in terms of we want to build a client that is competitive with Firedancer as well," Resnick shared.

He predicts that both the existing Solana client (developed by Solana Labs and now ANZA) and Firedancer will push each other to achieve higher performance levels. This competition, Resnick believes, will benefit the entire Solana network by driving continuous improvement and innovation.

Attracting the Next Generation of Developers

As the cryptocurrency space matures, attracting young, talented developers becomes increasingly crucial. Resnick, representing a younger generation in the crypto world, offered insights into what might draw new talent to blockchain projects like Solana.

He emphasized the importance of being open to new ideas and avoiding rigid power structures:

"I think it's really cool when the chain performs technically well. I think the other thing to attract young people is to be accepting of young people and to not have power structures that are set up to try and preserve power structures that have existed for 10 years."

Resnick praised Solana's openness to new ideas and its willingness to engage with young developers, citing examples of Solana's leadership interacting with teenage developers on social media platforms.

Conclusion: Solana's Path Forward

Max Resnick's move from Ethereum to Solana and his insights into the latter's development highlight the dynamic nature of the blockchain space. His perspectives on MEV, fee markets, multi-leader consensus, and client diversity provide a roadmap for Solana's continued growth and improvement.

As Solana aims to become a high-performance, decentralized financial platform, the implementation of these ideas and proposals will be crucial. With talented individuals like Resnick contributing to its development, Solana appears well-positioned to address its current challenges and push the boundaries of blockchain technology.

The coming years will be critical for Solana as it works to implement these improvements and solidify its position as a leading blockchain platform. As the ecosystem continues to evolve, the engagement of both established experts and young, innovative thinkers will be key to Solana's success in revolutionizing decentralized finance and beyond.

Facts + Figures

• Max Resnick, formerly of the Ethereum ecosystem, has joined ANZA as lead economist to work on Solana development.
• ANZA is a developer shop spun out of Solana Labs, focusing primarily on developing the Solana core protocol.
• Solana's current fee market is rated as a "B or B minus" by Resnick, an improvement from earlier in the year.
• A proposal for introducing slashing on Solana has been made, initially focusing on double signing of proposal blocks.
• Firedancer, a second client for Solana, is in development and is expected to increase network resilience and performance.
• Solana is aiming to achieve "decentralized NASDAQ" level efficiency through improvements like multi-leader consensus.
• The "Chili Pepper" proposal aims to improve Solana's storage pricing by calculating bandwidth needs for disk-to-memory operations.
• Solana's development discussions are more grounded in hardware realities compared to Ethereum's more abstract approach.
• Resnick played a role in shifting Ethereum's discourse to include more open discussions about Layer 1 scaling.
• Attracting young developers is seen as crucial for Solana's future, with an emphasis on openness to new ideas and avoiding rigid power structures.
• MEV (Miner Extractable Value) remains a concern in the Solana ecosystem, with both short-term and long-term strategies being considered to address it.
• The implementation of multiple concurrent leaders is viewed as necessary for Solana to handle market "jumps" more efficiently than traditional exchanges.
• Solana's current approach to storage pricing is considered inefficient, with proposals like "Chili Pepper" and "Avocado" aimed at improving it.
• The competition between ANZA's Solana client and Firedancer is expected to drive continuous improvement and innovation in the Solana network.
• Resnick estimates that achieving 1 million transactions per second could potentially generate $60 billion in annual revenue for Solana through transaction fees.

Questions Answered

Why did Max Resnick leave Ethereum for Solana?

Max Resnick left Ethereum for Solana due to the potential he saw in the Solana ecosystem and its development culture. He was impressed by the hunger and lack of complacency he observed in the Solana community, particularly during events like Breakpoint. Resnick also appreciated Solana's approach to blockchain development, which he found more grounded in hardware realities compared to Ethereum's more abstract model.

What is ANZA and what role does it play in Solana's development?

ANZA is a developer shop spun out of Solana Labs that focuses primarily on developing the Solana core protocol. It plays a crucial role similar to what Consensus did in Ethereum's early days. ANZA's main focus is the development of the Agave client, which runs on Solana validators. The organization works on improving and maintaining the foundation of the Solana blockchain, contributing significantly to its core infrastructure.

How does Solana plan to address MEV issues?

Solana plans to address MEV (Miner Extractable Value) issues through both short-term and long-term strategies. In the short term, the focus is on improving slippage settings in applications and potentially reconsidering the public mempool to increase competition. The long-term strategy involves implementing multiple leaders to create competition for transaction inclusion, making it harder for malicious actors to monopolize MEV opportunities. This approach aims to give users more options when faced with potential sandwiching attacks.

What is the "Chili Pepper" proposal for Solana?

The "Chili Pepper" proposal is aimed at improving Solana's storage pricing mechanism. It focuses on calculating the bandwidth needed for transactions to move data from disk storage to memory. This system would help prevent scenarios where too many cold storage accesses overwhelm the network's ability to bring data into memory within a single slot. By implementing this proposal, Solana aims to create a more efficient and fair system for pricing storage and computational resources on the network.

How does Firedancer contribute to Solana's development?

Firedancer is a second client being developed for Solana, which is expected to increase the network's resilience and performance. The introduction of Firedancer is fostering healthy competition and innovation within the Solana ecosystem. It's pushing the existing Solana client developers to improve their performance, leading to a scenario where both clients are striving to outperform each other. This competition is expected to benefit the entire Solana network by driving continuous improvement and innovation in client software.