Digital X: Welcome to Crypto Flywheel, the podcast where we spin up strategies to turn your digital efforts into unstoppable momentum. Now let's get that flywheel turning. You just heard about the big ETH drain on layer zero, right? 290 million gone before some attackers tricked a single verifier node into signing off on a fake stuff. It wasn't some genius zero day hack. It was exactly what happens when you apps picked their own weak security setup. One app, KelpDAO, went with one-off-one basically trusting just one guy, Layer Zero's lab's own node. Attackers poisoned its data DDoSDs the backups, and boom, one unlocked everything. The name, decentralized verified network, sounded fancy, but it wasn't ⁓ marketing. Zero decentralization is that setup. Now here's where Axelor steps in differently and why it's built to dodge exactly that kind of mess. of Axelor like a professional security firm for those bridges, not a toolkit where every app designs its own cheap block. Axelor runs its own full-blown blockchain network. ⁓ a proof-of-stake system. Like Ethereum or Cosmos with around 75 independent validators, real companies and operators running notes all over the world. These aren't random dudes. They stake their own AXL tokens have skin in the game. If they screw up or act shady, those tokens get slash burned or taken away. That's economic security backed right in. Here's a key flow. Super simple. When you want the bridge tokens or send a message say Ethereum to ⁓ or wherever Axelar's validators don't just take one person's word for it. They all watch the source chain themselves with their own full nodes. ⁓ vote on whether the event is real. Like did this lock transaction actually happen? It takes a big super majority, two thirds of the whole validator set to approve anything. No one of one, no pick your own weak quorum. You can't configure it down to trusting just Layer 0 labs or Google Cloud or one random node. security is fixed and shared across the entire network. Every app in XLR gets the same high bar. That alone killed a single point of failure you saw in Layer 0. Attackers couldn't just poison one RPC feed or DDoS couple servers. ⁓
ProfessorX: Okay.
Digital X: Because no single validator controls the keys or the decisions. Axelar uses fancy math called threshold signatures and multi-party cryptography. The key to sign off on messages split across a whole group. No one person holds that full thing. Even if a few validators get hacked or go rogue, the majority honest ones still block it. And because they're staked and slashable, colluding to fake message would cost them millions in lost tokens. It's not cheap or easy like tricking one lab run node. Plus, XLR has this hub and spoke set up with built-in firewalls. If one connected chain gets weird, it doesn't cascade and take down the whole thing. They also add rate limits, one big assets like USDC or ETH caps on how much can move in short time. So even if something sneaky slips through, which hasn't happened in this history, the damage is contained. Layer 0 says, hey, devs, you chose your own verifiers and risk level, flexibility for everyone. That's great for speed and cheap fees, but it puts a burden on the app builders. And we saw what happens when someone picks lazy. Axelar says, nope, the network itself is a secure messenger. We handle the heavy lifting with real decentralization and incentives. ⁓ no has to reinvent the wheel or cut corners. You don't need downstream protocols like Calp, Dow to run their own validators or guess the perfect configuration. Axelar's job is to make the bridge secure by default. That's why folks building serious stuff, stable coins, RWAs, big DeFi are eyeing Axelar more for the long haul. It's not flashy configurable. It's boringly robust, like a bank vault instead of a bike lock you can tweak yourself. No guarantees in crypto, but this design directly plugs a hole that let the 290 million walk out the door. Does that make sense guys? If you're hearing this and want more, hit me up with any followups. Happy to dive in. This episode is brought to you by Flow Ventures, your partner for Smarter HR Solutions.
ProfessorX: you
Digital X: Whether you're scaling your team or building, Flow Ventures has you covered. Visit FlowVentures.io to get started today.
ProfessorX: Well, Digital X, I want our listeners to know that that wasn't a Axelor show. I want to show you the bigger picture. Just step back and look at the pattern here. KelpDow and Drift Protocol, they didn't just get hacked. They were exposed where DeFi actually breaks. This didn't occur at protocol layer, it was actually the connection layer, right? Where when value moves, is either enforced or assumed, but most DeFi assumed it. know, most of DeFi assumes all of this stuff when they participate. You know, when we started in DeFi, there were a ton of projects that came out we were ⁓ with bots ⁓ all kinds of other front-running ⁓ right? Now the market is repricing the involved in DeFi. This is exactly what you just said. Axelar is just not... The are choosing Axelar more frequently now, ⁓ and being considered as a more secure option. And this is not any type of financial advice or we're not shilling Axelar. We're ⁓ Laying out the fundamentals of axel are in our previous episode We did a deep dive into it right not because we are shilling it but because we want you to understand the the the Securities the robust boring robust nature of axel are and why it's slowly creeping is because it's slowly identifying problems and Going against the you know the smoke And, ⁓ you know, seeing through the smoke, our listeners are going to have that advantage. So do you think about what I just said, Vigile X?
Digital X: Yeah, it's very, actually scary to participate in DeFi because of situations like this. So I understand, understanding projects the fundamentals ⁓ and the ⁓ that are the team that's involved in building these projects and pushing them out, you have to be very cautious in understanding that are they shilling the project where they want to pump the price or is it for long-term growth and sustainability? In this aspect, I don't think anyone could have anticipated this to happen, right? So it's unfortunate that it did. And in crypto, You'll hear stories like this every year.
ProfessorX: ⁓ Yeah, I mean look there was a ton of money that came out of Aave which is one of the trusted most trusted platforms for ⁓ Decentralized finance right so you saw a lot of these institutions pulling out just on this nose this this news and Where do you think in my opinion? The most of this money is now slowly going to trickle into ISO 222 of authorized projects like your XRP, XLM, XDC, ALGO, H-Bar, Quant. So Axelor is just another one that's not officially under there, but Layer 0 was getting all the hype, but now here we are. So keep that... Following us we're we're gonna break this down because we're following the finance the new financial system and all the all the assets that are going to be involved and of the assets that we talk about they're not really pumping or anything They're slowly moving creeping up and they're sustaining right now at a certain ⁓ but once that Adoption from institutions start coming in guys the these projects that we talk about frequently on the crypto flywheel is gonna there it's gonna it's gonna take off in my opinion
Digital X: Yeah, you're right. Actually, it is being utilized by institutions, but you just don't hear about it because it's a shiny thing, right?
ProfessorX: Yeah, there's no hyper marketing.
Digital X: Yeah, there's no hype behind it, but they're building behind the scene. So when it does pump, you'll be caught off guard. So it's good to position yourself where the prices are low. And I'm not trying to ⁓ you financial advice, but it's hard move, in my opinion.
ProfessorX: Yeah, mean, know, we, we can only, you're not going to get any moon shots, but going to slowly see these assets. I don't think there's going to be, it's a flywheel moment guys right now. The momentum is building, you know, so like you, digital, like said, this is not financial advice. We're giving you ⁓ the fundamentals what's happening the scenes. And we're telling you that based off of research on different platforms and what's within the banking industry. And if you go on any one of those white papers or ⁓ releases, releases and what have you, you'll see that these guys are slowly partnering with all of these projects and putting their infrastructure it. yeah, that's all I to say.
Digital X: Okay, Professor X, go ahead and fly Will out of here.
ProfessorX: Well, DigitalX, if you don't have anything further to add, this episode of the Crypto Flywheel is signing off. Thank you all.
Digital X: Thank you.
ProfessorX: Okay.
Digital X: Because no single validator controls the keys or the decisions. Axelar uses fancy math called threshold signatures and multi-party cryptography. The key to sign off on messages split across a whole group. No one person holds that full thing. Even if a few validators get hacked or go rogue, the majority honest ones still block it. And because they're staked and slashable, colluding to fake message would cost them millions in lost tokens. It's not cheap or easy like tricking one lab run node. Plus, XLR has this hub and spoke set up with built-in firewalls. If one connected chain gets weird, it doesn't cascade and take down the whole thing. They also add rate limits, one big assets like USDC or ETH caps on how much can move in short time. So even if something sneaky slips through, which hasn't happened in this history, the damage is contained. Layer 0 says, hey, devs, you chose your own verifiers and risk level, flexibility for everyone. That's great for speed and cheap fees, but it puts a burden on the app builders. And we saw what happens when someone picks lazy. Axelar says, nope, the network itself is a secure messenger. We handle the heavy lifting with real decentralization and incentives. ⁓ no has to reinvent the wheel or cut corners. You don't need downstream protocols like Calp, Dow to run their own validators or guess the perfect configuration. Axelar's job is to make the bridge secure by default. That's why folks building serious stuff, stable coins, RWAs, big DeFi are eyeing Axelar more for the long haul. It's not flashy configurable. It's boringly robust, like a bank vault instead of a bike lock you can tweak yourself. No guarantees in crypto, but this design directly plugs a hole that let the 290 million walk out the door. Does that make sense guys? If you're hearing this and want more, hit me up with any followups. Happy to dive in. This episode is brought to you by Flow Ventures, your partner for Smarter HR Solutions.
ProfessorX: you
Digital X: Whether you're scaling your team or building, Flow Ventures has you covered. Visit FlowVentures.io to get started today.
ProfessorX: Well, Digital X, I want our listeners to know that that wasn't a Axelor show. I want to show you the bigger picture. Just step back and look at the pattern here. KelpDow and Drift Protocol, they didn't just get hacked. They were exposed where DeFi actually breaks. This didn't occur at protocol layer, it was actually the connection layer, right? Where when value moves, is either enforced or assumed, but most DeFi assumed it. know, most of DeFi assumes all of this stuff when they participate. You know, when we started in DeFi, there were a ton of projects that came out we were ⁓ with bots ⁓ all kinds of other front-running ⁓ right? Now the market is repricing the involved in DeFi. This is exactly what you just said. Axelar is just not... The are choosing Axelar more frequently now, ⁓ and being considered as a more secure option. And this is not any type of financial advice or we're not shilling Axelar. We're ⁓ Laying out the fundamentals of axel are in our previous episode We did a deep dive into it right not because we are shilling it but because we want you to understand the the the Securities the robust boring robust nature of axel are and why it's slowly creeping is because it's slowly identifying problems and Going against the you know the smoke And, ⁓ you know, seeing through the smoke, our listeners are going to have that advantage. So do you think about what I just said, Vigile X?
Digital X: Yeah, it's very, actually scary to participate in DeFi because of situations like this. So I understand, understanding projects the fundamentals ⁓ and the ⁓ that are the team that's involved in building these projects and pushing them out, you have to be very cautious in understanding that are they shilling the project where they want to pump the price or is it for long-term growth and sustainability? In this aspect, I don't think anyone could have anticipated this to happen, right? So it's unfortunate that it did. And in crypto, You'll hear stories like this every year.
ProfessorX: ⁓ Yeah, I mean look there was a ton of money that came out of Aave which is one of the trusted most trusted platforms for ⁓ Decentralized finance right so you saw a lot of these institutions pulling out just on this nose this this news and Where do you think in my opinion? The most of this money is now slowly going to trickle into ISO 222 of authorized projects like your XRP, XLM, XDC, ALGO, H-Bar, Quant. So Axelor is just another one that's not officially under there, but Layer 0 was getting all the hype, but now here we are. So keep that... Following us we're we're gonna break this down because we're following the finance the new financial system and all the all the assets that are going to be involved and of the assets that we talk about they're not really pumping or anything They're slowly moving creeping up and they're sustaining right now at a certain ⁓ but once that Adoption from institutions start coming in guys the these projects that we talk about frequently on the crypto flywheel is gonna there it's gonna it's gonna take off in my opinion
Digital X: Yeah, you're right. Actually, it is being utilized by institutions, but you just don't hear about it because it's a shiny thing, right?
ProfessorX: Yeah, there's no hyper marketing.
Digital X: Yeah, there's no hype behind it, but they're building behind the scene. So when it does pump, you'll be caught off guard. So it's good to position yourself where the prices are low. And I'm not trying to ⁓ you financial advice, but it's hard move, in my opinion.
ProfessorX: Yeah, mean, know, we, we can only, you're not going to get any moon shots, but going to slowly see these assets. I don't think there's going to be, it's a flywheel moment guys right now. The momentum is building, you know, so like you, digital, like said, this is not financial advice. We're giving you ⁓ the fundamentals what's happening the scenes. And we're telling you that based off of research on different platforms and what's within the banking industry. And if you go on any one of those white papers or ⁓ releases, releases and what have you, you'll see that these guys are slowly partnering with all of these projects and putting their infrastructure it. yeah, that's all I to say.
Digital X: Okay, Professor X, go ahead and fly Will out of here.
ProfessorX: Well, DigitalX, if you don't have anything further to add, this episode of the Crypto Flywheel is signing off. Thank you all.
Digital X: Thank you.
