Howdy!

Last night, I bought a bike on Facebook marketplace, but the seller didn’t have Venmo. He gave me his ETH address, and I sent him some USDC on Base. Turns out he had to receive the funds on Ethereum mainnet, and the funds are now gone forever. This whole layer-2 roadmap deal has gone too far.

Anyways, today we’ve got MagicBlock open sourcing its tech, Solana DeFi TVL, and Magic Eden airdrop disappointment:

MagicBlock open sources a16z-backed ‘ephemeral rollup’ tech

The Solana gaming infrastructure startup MagicBlock is making its ephemeral validator — which creates momentary Solana rollups that can process transactions quicker — open source, the team told Lightspeed exclusively. 

When MagicBlock went through a16z’s crypto startup accelerator and began advertising its tech earlier this year, it conceived of itself as infrastructure for building onchain games. But when I spoke with MagicBlock co-founder and CEO Andrea Fortugno recently, he pitched me on a broader vision — that MagicBlock’s ephemeral rollups could let all developers move away from traditional web servers and make apps “unstoppable.”

To be clear, games are still being built with MagicBlock’s architecture. Supersize, which won the Solana-centric Radar hackathon’s gaming track last month, is built on MagicBlock. So is Windfall, Radar’s third-place gaming project. For both games, MagicBlock offers a way to run onchain without sacrificing speed. 

MagicBlock does this by running a non-voting Solana validator that runs in parallel with Solana and can momentarily make computing resources “elastic” before a security committee verifies the state and settles it to the layer-1. In other words, Solana’s data is temporarily moved to a rollup (like Optimism on Ethereum) for some time- or resource-sensitive functions that would ordinarily be performed offchain on centralized servers.

This newly open-source tech is initially under a license that will prevent other projects from launching commercial products with the ephemeral validator unless they strike a deal with MagicBlock, Fortugno said. MagicBlock currently charges a protocol-level fee as well.

Despite the new gaming clients, the pivot to other crypto sectors is also clear in MagicBlock’s messaging. I asked Fortugno if this was because crypto gaming outside of a few rare standouts like Off the Grid has so far failed to live up to the hype.

Fortugno disagreed with the assessment that crypto gaming is struggling, and he said other use cases could make use of ephemeral rollups with “zero effort.”

“The tech is already there, and so it would be stupid not to try to tackle the other use cases,” Fortugno said. He also said SocialFi apps and perpetual futures DEXs are looking at building on MagicBlock. DeFi makes sense as a use case here: Solana-based perps DEX Zeta Markets is building a Solana layer-2 of its own to compete with centralized exchange speeds. 

Fortugno used the term “unstoppable” frequently in our interview, which is really what’s cool about ephemeral rollups. Many Solana apps have parts run by centralized entities partly because doing everything on a blockchain is not financially viable. If MagicBlock lives up to its billing, it could make these apps a lot more trustless.

— Jack Kubinec

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In dollar terms, Solana DeFi is reaching 2021 levels. Do with that information what you will: 

This is the total value locked (TVL) in Soland DeFi protocols, per DeFiLlama. After breaching $10 billion in 2021, the network’s value would sink to around $200 million before steadily climbing over the past year.

As things stand, Solana DeFi protocols hold around $9.4 billion. A lot of this comes from Solana DeFi projects that keep surging. And Binance’s $1.2 billion from its new Solana liquid staking token doesn’t hurt either.

— Jack Kubinec

Magic Eden seems to have pulled off a rare feat: turning a highly anticipated token airdrop into a case study in how to alienate loyal users. Between a buggy wallet app, eligibility misfires, and an opaque claim process, what should have been a triumph for the platform has instead become a lesson in user frustration. Instead of front-running expectations and delivering a smooth, user-friendly experience, Magic Eden managed to disillusion many Solana diehards, NFT traders, and even casual participants who just wanted their slice of the pie.

The social response has been predictably brutal. “So $ME claim has started. And as expected, Magic Eden wallet app, Solana… everything is breaking,” wrote @jaadasss, recounting a cascade of errors, including a mysterious "iOS not updated" message on an up-to-date device. He similarly took aim at the financial aftermath, continuing “[The price] went to $13 and now at $5, and we still haven’t even claimed yet."

@Mealsandeals shared their disappointment: “I traded over 80k in volume on Solana using a Magic Eden wallet… Guess how many $ME I got? Zero lol.” @Easy_Gz echoed the bitterness, explaining that they had “traded over $100,000 worth of NFTs… starting the first day they went live and still didn't get a single $ME. What a joke…”

Others declared they were done with Magic Eden entirely, including @ImBarrenWuffet, who quipped, “Deleted app instantly after claiming.” Users like @maxmanchi agreed, saying “The UI is absolute trash,” while @wgmi420 deemed it “a disgrace to crypto wallets.” Meanwhile, @BaerEvo_ captured the local sentiment of Solana users, noting “If it weren’t for Solana, Magic Eden wouldn’t be a company.”

— Jeffrey Albus

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