How Cartesi lets developers build Ethereum apps with Linux tools

0:00I'm Ashton Addison from the Cryptocoin Show and today on blockchain interviews we have Felipe Arento, co-founder of Cartesi. Cartesi coming back on the show after many years uh growing since 2018 I believe. Uh welcome back to the show Cartesi and Philip Felipe. Thank you for taking the time. >> Sure. It's a pleasure to be here and thanks again for giving us the platform.

0:22Definitely excited to hear about the latest updates um Ethereum specific scaling uh rollups uh stage two launch which I know is is the latest we can dive into and getting the world ready for more developers and engineers getting involved in blockchain. I feel like now is a a great time for people to be getting onboarded as institutions uh institutional interest is probably at an

0:50all-time high and 2026 has started pretty strong here with interest from Bitcoin, Ethereum and other layer 1 chains as well getting adoption. So I have a feeling it's going to be a good year ahead. >> Yeah, for sure. I'm also quite excited. I think uh it's funny this institutional shift to Ethereum. Uh it's like uh you know we always thought that Ethereum was

1:16too slow but actually if you compare with the the financial system the traditional [laughter] like settling happens much faster things the cash gets settled I mean the expectations are are much smaller than I guess retail expectations. So, it's nice to see making a progress in that in that direction and that makes me excited for Cartasi as well. >> Definitely. I'd love to paint a picture

1:43of Ethereum scaling and how Cartesi fits into that. You guys have had the the vision for many, many years now and understanding, you know, Ethereum was the future. Of course, it takes institutions a little bit longer to get on board, but it seems like the network effect is growing for Ethereum in institutional interest, mainstream adoption, and I'm sure that's reflecting

2:05in Cartesi as well. Could you start by giving a high level on Cartesi and how that fits into the picture? >> Yeah, sure. Yeah. Yeah. So, I like to explain Carteesi differently every time I talk to someone new. So, let let's go with Cartezi is an addition to Ethereum. We're adding this powerful uh engine on top of Ethereum that does things that Ethereum normally does not do, right?

2:31And it's an engine that inherits all these cool properties of Ethereum. So decentralization, censorship, resistance, uh the the like reduces counterparty risk and everything everything that uh institutions like. But we do uh add new powers to it. Then this new power I'm talking that I'm talking about is mainly a new machine. >> So this we always we call it cartis

2:55machine but it's a Linux based virtual machine that extends the power of what apps can do while not losing the things that make Ethereum amazing. Right? So so the the technical term for that is an app chain roll up >> with an out VM. Right? So it's a a rollups a scaling technique for Ethereum that as I said doesn't lose the the the important powers of Ethereum and uh

3:25outvm means a different machine than the AVM that allows you to do different things and than what we could do with solidity right national you already know the project quite well because I we've been here a few times but for those that don't know the the cool thing about this Cartezi machine is that uh it looks like a normal traditional computer, right?

3:47So, you can use the programming languages that you use when when you're coding say web two applications. Uh you can use the libraries and and and the programming languages and well, we have an operating system. So, everything that you can do on an operating system, which is virtually everything you can do using Cartisi on top of Ethereum. So, that's

4:08super cool. Yeah, I think that's really great because I don't know the numbers exactly, but I imagine there's hundreds of thousands or millions of Web 2 developers and even looking at companies like IBM and Microsoft, you know, they've had decades of work probably on Linux based systems and then EVM and Solidity comes along and it's a lot harder to just drop everything you've

4:34been working on for decades to jump to something new. But if you can make it cross-co compatible, I feel like using Linux- based uh virtual machine for blockchain, then it's like okay, just plug and play, right? Have the adapter. >> Yeah. And um you brought up the number of developers who know how to code for Linux, right? Uh and it's the number of developer plus all the open source code

4:59that has been written in the past. So like we've ran like TensorFlow you know it's an AI library Python I I believe we ran it on the cartisian machine so it's now adaptable like it's compatible with the blockchain but it's also and I think even more incredible it's also the future code that's being written right because it's not like web two has come to a hold and

5:21we just fully migrated web three the majority of development work is still on web two right >> so this bridge that we built between web two and Ethereum or traditional computers uh traditional machines and the and the Ethereum virtual machine that is also like that also makes all the future uh open source code available to to blockchain applications which is

5:46uh I think super cool. >> I agree. I think that Linuxbased uh VM and the cross compatibility is a huge advantage. When people see, you know, layer twos or add-ons to Ethereum, they often start thinking of, you know, base chain or arbitrum, some of these ones that have succeeded and there was there there have been and there still are, some are probably dying out, but a lot

6:10of different layer 2 solutions on top of Ethereum. Some of them might not have any really competitive advantages. Uh I obviously this Linux is a competitive advantage but is it similar to other layer 2s on Ethereum in the other way that people might think of of base and arbitum? >> Uh yeah so that's a very good question. So it's similar in some ways and very

6:34different in other ways. Uh so historically layer tools on Ethereum were mostly used uh not uh to differentiate like this chains they don't try to differentiate from Ethereum they just try to to be more scalable right so they're in a sense a copy of Ethereum with say bigger block sizes or or sequencers to make latency uh is smaller and so on and I mean that's a

7:00very fair uh position to take But I don't think it's the best position. Uh well, if you see now like now that Ethereum is is focusing on scaling the L1 again. Uh it's going to get much much cheaper to to use Ethereum mainet. >> So like what what happens to this like all these EVM L2s, right? That they're they just copy the functionality of Ethereum but they are faster now that it

7:26gets faster like what happens, right? So it's Cartis is similar in the in the construction of a rollup in the sense that like the inputs come from the blockchain and and every result every state of date can be verifiable on Ethereum and is enforced by Ethereum. So the basic mechanism is is similar. Uh what we have is that the very significant difference which is a

7:53different machine right. So B for instance is a EVM layer 2. So they >> they just run EVM code on their chain. We are a carti machine later too. So we run these as we were talking about Linux machine. Uh and I think it's cool because now I think we're going to go through a phase where these L2s are going to be forced to differentiate since scaling is no longer the the

8:16bottleneck and we'll see what's going to be the difference between optimism and bas you know let's let's see what comes from that. Definitely. I think it's a major advantage especially as we've said with all the developers that don't know EVM based programming languages. We got to get them in somehow and hopefully AI is also helping with that. >> Uh you know it it's allowing people to

8:41become developers uh that previously didn't really know how to code. Um and and you also mentioned there about like the sort of the libraries, you know, there's that Linux has probably millions of different things of in the library that you can just use that. You don't have to start from scratch where with EVM, I'm sure there's barely any in comparison.

9:03>> Yeah. Yeah. And uh touching back on what you just said about AIS, you know, like AIS, they they learn uh by consuming lots of data, right? So the coding agents uh what they do is basically they they learn to code by looking at existing code >> and as you just said yourself there's a lot more code for these types of normal machines than there is for EVM. I also

9:27expect the the coding agents to help much more building an app that is compatible with a web two than building a say pure web web3 app. though I mean this is not a good way to put it because apps built on Cartasi are p pure web three apps right they run they're unstoppable they run in the decentralized manner their censorship resistance and so on they just use the

9:49same language that web two apps use right >> yeah that's it >> definitely and from what I understand part of the important upgrade to to blockchain is the decentralized nature and the security of the protocol not having a centralized point of failure like you know finding somewhere we can hack into the IBM server and you know by some single point of failure that it's

10:14the issue with centralized systems. So with the cartesi machine you're using traditional language but are you still backing on to like web 3 decentralized based security? >> Yes. Yes. Uh so Cartis machine runs on top of Ethereum and it inherits all those uh uh trust assumptions from Ethereum with one added assumption that that's a single assumption which is uh there's one

10:44honest party using the application. So if you have an application running on Cartisi and you have one single honest person using that application then you have all the all the assumptions that Ethereum has which is decentralization censorship resistance uh like this resilience basically right and the cool thing is that that honest person can be you so it's not like you're relying on a

11:12fixed set of people when you you >> have to trust one person in that set no you can yourself enforce uh whatever you're using on Ethereum itself. So that's that's non-negotiable, right? Otherwise, you just run whatever you want on Amazon and then just trust the result. [laughter] >> Definitely. When there are all these options for layer 2 chains, I'm sure the base has a

11:39team that's going out to enterprises and being like, hey, you know, use us. Does Cartesi need to have, you know, a a marketing team that needs to convince web two developers that they should be building uh on the Cartesi machine or does the technology speak for itself? How do you find that balance? >> Well, that's a a current challenge that we have. Uh so when we first began in I

12:05guess 2018 we we followed that strategy of all right like we allow web two code let's go to web two developers >> but then the let's call it the sales speech it's not a public good right so we're not selling anything we're just trying to convince to use our infrastructure but the sales speech was uh like we first had to convince them that they should use web three

12:31>> mhm And then you have to explain to them what Ethereum was. >> And then you had to explain to them like but look but Ethereum is incomplete. You know there's a scalability problem. And then you had you'd have to explain rollups. And by the time you're explaining Cartazzi like they don't they're not really interested anymore, right? It's like a >> when blockchain is not that mainstream

12:50like how come like you go to a bank and have a meeting of I don't know the system system engineer in the bank and you're pitching this like three layers down thing. Well, when they don't even understand Ethereum. >> So that didn't work in the past, right? So we started trying to convince or we started convincing people on web three that web two tooling was was great. But

13:14now that institutions are coming back to Ethereum or not coming back, but they're coming to Ethereum, then I think the conversation is much easier because now they know what Ethereum is and now they know that there's this financial system uh that that that can be an upgrade to the traditional financial system. And then that's the starting point of the

13:31conversation. Then then we can say like look you know there this new new financial system and if you want to be involved then you can use the expertise that your I don't know your bank already has the coders that your bank already already employs and you can like make them use Cortez and then you're suddenly plugged in on this uh new world. So I'm I'm excited to see what's going to come

13:54out of that you know that new way of that new possibility that we have now. Definitely your team was early in in 2018. I believed in Ethereum then, but uh having to explain, you know, Ethereum and then smart contracts and then the difference and then why you should use it, you know, like that's like you have to convince three times as many times uh to to use Cardi. But now that the

14:19foundation is set, they understand Ethereum is the future. It's just about how are we going to integrate. I feel like there's an advantage of okay, we don't have to learn EVM languages. We can use the languages that we're already using at the bank and then we can connect into web 3 and I feel like that gives the Cartesi an advantage over the other layer twos.

14:39>> Yeah. And and there's an added advantage which is another difference between the carti rollups and say bay or roll-ups which is that cartazzi is uh we call it an app chain specific rollup or app specific rollup right so it means that for each application you spin up a new chain and all these chains they have these characteristics that we were discussing but the fact that you can

15:02spin up a new chain gives you a lot of power right for institutions is much better because they can spin up a chain that is compliant with whatever regulations they have to comply to, right? You can spin up a new chain that has the characteristics that that you need to have, right? So, I think we're actually quite in in a good quite good place uh to help on board institutions

15:25to to Cartezi. >> Let's see. >> That's very exciting. And I think a good example may be that some of these enterprises need AML KYC procedures and like Ethereum as a layer 1 doesn't have that and and therefore you need to have this on top if you want to implement some of those protocols that you're need that are needed for your industry and for the regulations.

15:51>> Exactly. Yeah. >> Yeah. That's great. I I was reading that this is it's not just a roll up, it's a stage two rollup and and I was curious if that's a new thing or what's the advantage of stage two? >> Uh yeah, that's a good very good question. Uh so a while ago Ethereum released this rollup centric road map, right? And rollup is basically a technique on how to scale Ethereum and

16:16scale scaling different uh verticals, right? not only transactions per second, not only computation but even expressiveness, right? And then a bunch of teams they started building rollups and it's a bit complicated because in theory rollups is a technique that uh extends the trust assumptions of Ethereum right so you have this like you you build a scaling a scaling solution

16:41that is still censorship resistant that is still secure that is still resilient but in reality when you start to build that uh it's none of those things right so you're saying like I want to build a rollup and then you start building a rollup up, but until the rollup is closer to being complete or to being like feature uh complete then like you have I don't know a central like you

17:03don't have a proof system ready right but you're still calling yourself a rollup because you you eventually will build a proof system but you only get the features of a rollup once you build a proof system right so the landscape became a mess everyone was calling themselves a rollup uh some people were just running centralized servers and saying that they were a rollup

17:23>> uh And then L2 bit which is like this organization in my opinion the best uh or in the space they came up with a standard right so they that all right let's do let's think about stages right you have rollups which are stage zero stage one and stage two >> stage zero rollups are like rollups that they want to be rollups but they still

17:51have a lot of centralized pieces So if you have your money there in a stage zero roll up then just know that like some people they have the power to mess with that. They can upgrade it. They can they can steal your money somehow, right? So they're saying that they want to be a rollup but they're not ready, right? They're not uh at that point. A stage one rollup is much better

18:13than a stage zero. So a stage one rollup is a rollup that has a pro system that works but there's still like some oversight. Some people can step in to fix bugs on this proof system. Some people can upgrade the system and so on. A stage two roll up which is the last stage uh predicted on on the L2 bit uh L2 bits layer 2 bit right so the L2 bit uh proposal is a roll up that is

18:43totally decentralized and totally totally permissionless. So it's a rollup that runs in with the same rules as Ethereum. anyone can interact with, anyone can uh like no one can stop you from removing your money from there. And uh just as we were talking before, if you're honest and you can enforce that this rollup is going to act honestly even if the founder, the developer, they

19:09want the application to act dishonestly, you as an user can enforce the honest behavior. Uh and Carteesi managed to accomplish that. And I mean you can only accomplish that if you take research. uh and development really seriously because there's a pressure in this space >> to for you to prioritize uh speed and convenience uh and not prioritize robustness right because

19:33robustness only matters when things go wrong uh but then that it's I mean it's an easy way to attract users but then like what are you really doing right >> uh so we did the work we created a proof system so we have a stage two rollup app chain roll up which is I mean out of our control people can can see it can use it can try to break it >> people can try to enforce incorrect

20:00results there's a a fraud proof game everything implemented everything running so that's quite exciting so and what we want to do is create a factory of stage rollups so we want you to be able to very easily build your application on Linux uh and deploy your Carti chain and that to be something that is not yours anymore like as soon as you deploy it it's now like you cannot stop it from

20:28running you cannot mess with the rules that the code has defined and so on just like Ethereum right >> yeah having a unstoppable decentralized uh protocol that you couldn't the Cartesi core team couldn't stop it if they tried I think is is what you want for a foolproof uh blockchain ecosystem. So, >> yeah, appreciate you explaining that. And you hinted at

20:56earlier on about, you know, DeFi and moving funds. I I feel like out of all the different types of applications you should be making. You know, if you go to the bank, for example, they're probably looking at uh in some sense initial uh DeFi applications. Um, how important is def our DeFi apps right now on on Cartesi? And I feel like some of the layer twos, you know, people look at how

21:22good it is compared relative to how much total value locked or how many how much funds are on there in DeFi. >> Yeah. Yeah. So, I think that's an adjustment that Cartis is making. Uh, in the past, we wanted because so we're bringing this new thing, right? and we bring a lot of computational uh scalability. We wanted people to create all sorts of things. So we saw

21:48experiments using AI. We saw some very cool games. We saw governance systems and so on. So we were trying to explore this world computer side of Ethereum and not the hyper financialization of Ethereum especially because defy was uh beginning and it was quite simple right the the kind of applications that you have on the fi they have this forced simplicity to it but the fact is that

22:14while Ethereum is uh I don't want to say pivoting but I mean even Vitalik said it himself on on that that connect. He said that Etheum is for finance and a long tail that includes governance and games and so on. But I mean the the clear winner so far is finance, right? That's what's going on at the moment. Uh I don't quite like the TVL metric. >> Mhm.

22:41>> Because I mean who who celebrates money locked, right? Uh if you have to celebrate money moving around and and and things being used, right? not not for instance like on swap like there's a lot of it's a wildly successful and an awesome application uh but it's I I'd say it's less efficient than an order book but it's going to have much higher TBL than an order book just because you

23:05have these liquidity providers who have their money parked there >> and then you have to pay them right >> u so but yeah so I think we're uh coming coming to terms with the fact that uh the moment is for defy mainly and we are uh talking much more about that and and talking about how to serve and what kind of defy applications need the computational power that we have in

23:28Cartisi and uh and the expressiveness that the Cartesi machine has, right? How how much more complex should Defi be able to be? What financial libraries do people use on web two that can be used on web three? What like how can you design a better order book with the tools that that we have for Linux and so on so forth. So that's a quite an exciting role to to experiment and I

23:51hope that you'll see some uh cool things coming out out from Karte soon about defi. Let's see. Would love to see that. And if you know if there are if there is value locked that's not moving which yeah ideally you want money moving that's probably a better metric. Uh but if they are locked into base or arbitrum or wherever the other funds are, how easy

24:16is it for financial advisors or people that are non-technical, not developers to uh theoretically move that into uh a DeFi app that was built on Cartesi. >> Uh yeah, so for now like the community is putting a lot of effort on interoperability for now for at this time. But for now I think the best way uh is to move from base to L1 and then

24:44L1 to Carteesi right u but yeah I hope we have we find some solutions to that so you can move directly between one L2 or the other I think there are some uh big projects that are trying to do that right you can like exchange money from one in the other there's some market makers or I don't know liquidity providers and so on uh but for now you have to to to

25:07move from base to Ethereum and from Ethereum to to Cartis. But bear in mind that we can also launch Cartis chain on top of B. So it can work as an L3. We actually have some some live apps that run on top of B. We have a very cool game called Rives Rives.io >> uh which is like a world arcade that runs uh runs on base if I'm not mistaken. >> Cool. I'll check that out. and moving,

25:36you know, 2026, we mentioned it at the beginning. I'm pretty optimistic uh this year for further adoption. Uh what are some of the main goals that the Cartesi ecosystem is working on to drive more adoption and and release uh more updates in you know the first half of this year? >> Yeah. So last year we achieved the stage two that we were talking about. Now we

26:03are very close to generalizing this stage two. So basically making anyone be able to launch very easily launch a Cartazi chain uh already on stage two. I think that's going to be super cool. And then we have to work on uh on boarding developers on boarding users and maybe building something ourselves to show the power of Cartees. You know that that would be cool as well.

26:28>> Definitely. And what is the what is the best way to explore the ecosystem if you're a traditional developer or if you're just somebody who loves using AI and you know you you are a developer in the making. Uh where do you get started in exploring the ecos? >> Yeah, we have a you can go to cartazi.io. Uh we have very good docs there. Uh our our documentation team is

26:50incredibly good. quite easy to follow and well since it's web two web two like the tools are quite friendly as well and uh we are a public code project right so everything we do in public if you go to our discord uh server you can read our developers talking to each other we can see our research happening and we have a community there that uh asks questions

27:16and interact with us so feel free to join in enter the discord channels and just have a chat with us. >> We are very welcoming. >> Sounds great, Felipe. Looking forward to uh seeing those updates. I'll leave a link to the website, the ecosystem, and the Discord in the show notes below. Appreciate you and the team's work on Ethereum, getting more developers, which

27:40we need uh involved, you know, from the traditional world. get them into blockchain, get them onchain and get the rest of, you know, the world and all the enterprises and the companies in the world on chain. And for that, you know, we need apps uh to be built on chain. So, I think this is necessary. And I'm glad to have Cartesi back on now. >> I think it's been six or seven years

28:05since the first time and we've had you guys on throughout the years. So, it's great to have a 2026 update. All the best to you and the team moving forward and would love to follow up again in the near future. >> Thank you, man. It was a pleasure being here and I think you're running out of time as an industry to to show what we're here for. So, let's make 2026 the

28:23year that we do that.