Music, Jiu Jitsu, and MEV with Zano from JitoLabs

In a fascinating interview, Zano, the CTO of Jito Labs, sat down with the hosts of Midcurve Offsight to discuss his journey into the world of cryptocurrency, his passion for music and Jiu Jitsu, and the intricacies of Solana's blockchain technology. This deep dive into the mind of one of Solana's key players provides valuable insights into the current state and future direction of the blockchain ecosystem.

Zano's Journey into Crypto

Zano's introduction to cryptocurrency came in 2015 when he was still in physics class. He recalls seeing a news segment featuring a Bitcoin address, which piqued his curiosity. At the time, Bitcoin was trading around $75-$80. This initial exposure led him to share his excitement with a friend, marking the beginning of his crypto journey.

As Bitcoin's price surged to $500 in the following weeks, Zano's interest in the cryptocurrency space grew. He continued to monitor the crypto market while pursuing his computer science studies, developing a passion for software development that would later prove instrumental in his career.

From Speculation to Innovation

Like many early crypto enthusiasts, Zano's initial involvement in the space was largely speculative. He dabbled in various cryptocurrencies, including Bitcoin, Ethereum, and even Cardano. However, his true calling in the crypto world came in 2020 when he joined Parsec, a company he describes as "kind of like a Bloomberg terminal" for the crypto space.

It was at Parsec that Zano first encountered the concept of MEV (Miner Extractable Value) and began to understand its significance in the blockchain ecosystem. This experience would later inform his work at Jito Labs, where he would apply his knowledge to improve the Solana network.

The Creative Side of Engineering

One of the most intriguing aspects of Zano's interview is his perspective on the creative nature of engineering. When asked if engineering is creative, Zano responds affirmatively, drawing parallels between coding and artisanal craftsmanship. He views his source code as a piece of art, emphasizing the balance between science and creativity in programming.

Zano elaborates on this idea, stating, "I think like anything where, uh, whereas where, you know, you have an end state, but the path to that end state could be different. You can be creative all you want. So the programming's that way." This perspective highlights the innovative thinking that drives advancements in blockchain technology.

Music and Martial Arts: Balancing the Mind

Beyond his work in crypto, Zano is passionate about music and Jiu Jitsu. He explains that these activities help keep him mindful and present, providing a necessary counterbalance to the intense focus required in his professional life.

Zano's musical journey is particularly interesting. Growing up playing the Saz, a Kurdish three-stringed instrument, he has since transitioned to electronic music production. This shift from traditional folk music to modern electronic sounds mirrors his journey from conventional computer science to cutting-edge blockchain technology.

The State of Crypto: Progress and Challenges

When discussing the current state of cryptocurrency, Zano offers a balanced perspective. He acknowledges that while the initial promise of crypto as a solution for easy international money transfers hasn't fully materialized, there have been significant advancements, particularly in developing countries.

Zano points out that in the first world, crypto is often used primarily for speculation. However, in developing nations, cryptocurrencies are increasingly being used for their intended purpose of facilitating financial transactions. He cites examples of people using crypto to send money from Hong Kong to the Philippines and from the United States to Argentina.

Solana: More Than Just Meme Coins

Addressing Solana's reputation as a "meme coin chain," Zano offers a positive outlook. He argues that meme coins are essentially an extension of internet culture, and attaching value to these cultural elements can be a powerful tool for coordinating large communities across the world.

Zano believes that the future of crypto lies in integrating with legacy systems rather than completely replacing them. He envisions a world where traditional financial services are built on top of crypto rails, similar to how fintech companies like Venmo revolutionized money transfers while still utilizing existing banking infrastructure.

Understanding JitoLabs and MEV

Jito Labs, where Zano serves as CTO, plays a crucial role in optimizing the Solana network. Zano explains that Jito's primary function is to bring order to the chaotic system of transaction processing on Solana's open network.

With over 2,000 validators across the world and essentially free transactions, Solana faces challenges related to spam and network congestion. Jito addresses this by implementing a bidding system for transaction priority, ensuring that users who value speed can pay for faster processing while redistributing these fees to validators and users.

Zano uses an analogy of a nightclub line to explain MEV (Maximal Extractable Value). Just as someone might tip others in line to move to the front, MEV allows users to pay for priority in transaction processing. This system not only improves efficiency but also provides additional incentives for validators to secure the network.

The Growth of Jito

The interview reveals impressive growth statistics for Jito. In just one year, the percentage of the Solana network running Jito validators has increased from 10% to nearly 60%. This rapid adoption underscores the value that Jito brings to the Solana ecosystem.

Zano expresses a mix of excitement and healthy pressure regarding this growth. He sees it as validation of Jito's approach and a motivator for the team to continue improving their systems.

The Future of Solana

Looking ahead, Zano discusses several key developments on the horizon for Solana. He mentions the upcoming 1.18 scheduler change, which aims to address the network's spam problem by making such activities less incentivized.

One of the most intriguing concepts Zano introduces is the idea of multi-dimensional fee markets. This innovative approach to transaction processing could revolutionize how fees are calculated and prioritized on the Solana network.

Multi-Dimensional Fee Markets Explained

To explain multi-dimensional fee markets, Zano uses a creative analogy involving flags. In the current Ethereum model, there's essentially one "flag" that represents the ability to process a transaction. Whoever grabs this flag first (by paying the highest fee) gets their transaction processed.

In contrast, Solana's proposed multi-dimensional fee market would be like having a thousand flags. Different types of transactions (like NFT mints or DeFi trades) would compete for different flags. This system would allow for more nuanced fee structures, where high-demand activities could command higher fees without affecting the cost of other types of transactions.

The Importance of Mobile in Crypto Adoption

Zano touches on the significance of mobile technology in driving crypto adoption. He mentions the Solana mobile phone, which has reportedly surpassed 100,000 units sold. This achievement is particularly impressive for a non-Android, non-Apple device in the crypto space.

The discussion highlights a current limitation in the crypto industry: most users still prefer to conduct transactions on their laptops rather than mobile devices. Zano suggests that this reliance on desktop interfaces might be hindering mass adoption, emphasizing the potential of mobile solutions to bridge this gap.

Liquidity and Market Making on Solana

Addressing concerns about liquidity on Solana, Zano acknowledges past challenges but notes significant improvements. He credits the persistence of teams like Jito and others who continued building during tough times when liquidity and volume were low.

Zano reports that the situation has improved considerably, with more professional market makers and traders coming to Solana. While exact numbers weren't provided, the trend suggests growing confidence in the Solana ecosystem.

The Importance of Community in Blockchain Development

Throughout the interview, Zano emphasizes the collaborative nature of blockchain development. He expresses gratitude for the teams that persevered through challenging times, continuing to build and improve the Solana ecosystem even when market conditions were unfavorable.

This sense of community and shared purpose is evident in Zano's parting message to the audience: "Be nice." He stresses that despite competition and differing approaches, everyone in the blockchain space is ultimately working towards the same goal of creating a more efficient and accessible financial system.

Conclusion: A Bright Future for Solana and Blockchain Technology

The conversation with Zano provides a comprehensive look at the current state and future potential of Solana and the broader blockchain ecosystem. From the technical innovations of Jito Labs to the cultural impact of meme coins, the interview paints a picture of a rapidly evolving industry that's poised for significant growth and mainstream adoption.

As Solana continues to develop and refine its technology, with innovations like multi-dimensional fee markets on the horizon, it's clear that the platform is positioning itself as a major player in the future of decentralized finance. With passionate and innovative leaders like Zano at the helm of key projects, the Solana ecosystem seems well-equipped to tackle the challenges and opportunities that lie ahead.

The blend of technical expertise, creative thinking, and community-focused development highlighted in this interview suggests that Solana and projects like Jito Labs are not just building technology, but fostering an ecosystem that could revolutionize how we interact with financial systems on a global scale.

Facts + Figures

• Zano first heard about Bitcoin in 2015 when it was trading around $75-$80.
• Bitcoin's price surged to $500 shortly after Zano's initial exposure, sparking his interest in cryptocurrency.
• Zano joined Parsec, a company similar to a Bloomberg terminal for crypto, in 2020.
• Jito Labs has grown from managing 10% of Solana's network validators to nearly 60% in just one year.
• The Solana mobile phone has reportedly sold over 100,000 units.
• Jito's system redistributes transaction fees to users and validators, with validators earning an extra $3-5 million per month.
• Solana has over 2,000 validators running its network globally.
• The upcoming Solana 1.18 update includes a scheduler change aimed at reducing spam transactions.
• Zano grew up playing the Saz, a Kurdish three-stringed instrument, before transitioning to electronic music production.
• During the COVID-19 pandemic, some people in the Philippines were reportedly earning up to $300 per day playing the blockchain game Axie Infinity.
• Jito's growth has increased from managing 10% of Solana's network to nearly 60% in just one year.
• Solana is developing multi-dimensional fee markets to optimize transaction processing and fee structures.
• Many crypto users still prefer desktop interfaces for transactions, with a significant majority not using mobile devices for NFT purchases.
• Zano suggests that the reliance on desktop interfaces might be hindering mass adoption of cryptocurrency.
• The Jito Airdrop reportedly changed lives in some third-world countries, with one recipient receiving an equivalent of three years' worth of income.

Questions Answered

What is Jito Labs and what does it do for Solana?

Jito Labs is a company that works to optimize the Solana network by bringing order to its transaction processing system. It implements a bidding system for transaction priority, allowing users to pay for faster processing while redistributing these fees to validators and users. This system helps manage network congestion and provides additional incentives for validators to secure the network.

How does Zano explain MEV (Maximal Extractable Value)?

Zano uses an analogy of a nightclub line to explain MEV. Just as someone might tip others in line to move to the front, MEV allows users to pay for priority in transaction processing on the blockchain. This system improves efficiency by allowing those who value speed to pay for faster processing, while also providing additional incentives for validators.

What are multi-dimensional fee markets in Solana?

Multi-dimensional fee markets are a proposed innovation for Solana's transaction processing system. Unlike the current single-queue system (analogous to one "flag" in Zano's explanation), multi-dimensional fee markets would have multiple queues (or "flags") for different types of transactions. This would allow for more nuanced fee structures, where high-demand activities could command higher fees without affecting the cost of other types of transactions.

How has Jito Labs grown over the past year?

Jito Labs has experienced significant growth, increasing its management of Solana's network validators from 10% to nearly 60% in just one year. This rapid adoption underscores the value that Jito brings to the Solana ecosystem and has created a mix of excitement and healthy pressure for the team to continue improving their systems.

What is Zano's background and how did he get into cryptocurrency?

Zano first encountered Bitcoin in 2015 while in physics class, when Bitcoin was trading around $75-$80. He studied computer science and speculated on various cryptocurrencies before joining Parsec in 2020, where he learned about MEV. This experience led him to his current role as CTO of Jito Labs, where he applies his knowledge to improve the Solana network.

How does Zano view the creative aspect of engineering?

Zano sees engineering, particularly programming, as a creative process. He compares writing code to creating artisanal crafts and emphasizes the balance between science and creativity in programming. He believes that creativity comes into play when there are multiple paths to achieve an end goal, allowing for innovative solutions in software development.

What is Zano's perspective on the current state of cryptocurrency adoption?

Zano acknowledges that while the initial promise of easy international money transfers hasn't fully materialized, there have been significant advancements, particularly in developing countries. He notes that in the first world, crypto is often used primarily for speculation, while in developing nations, cryptocurrencies are increasingly being used for their intended purpose of facilitating financial transactions.

How does Zano view Solana's reputation as a "meme coin chain"?

Zano sees the prevalence of meme coins on Solana as a positive aspect, viewing them as an extension of internet culture. He argues that attaching value to these cultural elements can be a powerful tool for coordinating large communities across the world. Zano believes that this cultural integration is a natural part of building on internet infrastructure.

What role does mobile technology play in crypto adoption, according to Zano?

Zano emphasizes the importance of mobile technology in driving crypto adoption. He mentions the success of the Solana mobile phone, which has reportedly sold over 100,000 units. Zano suggests that the current reliance on desktop interfaces for crypto transactions might be hindering mass adoption, and sees mobile solutions as a potential way to bridge this gap and make cryptocurrency more accessible to a wider audience.