In this interview, Kenny Li, Co-founder and COO of Manta Network, shares his expertise on the evolving landscape of Web3 and blockchain technology. With a focus on Manta Pacific’s innovative approach to modularity and scalability, Li offers a unique perspective on the future of decentralized systems, the potential of AI in blockchain, and the role Asia plays in driving the global adoption of crypto solutions. 

What makes Manta Pacific’s approach to modularity unique in the L2 ecosystem, and how does it set a new standard for scalability and security?

Modularity is a common technique used in industries outside of Web3, including cloud computing. Instead of building everything in-house, modularity allows us to take pre-existing technologies and plug them into our infrastructure to provide new or additional features, functionality, scalability, and security to our users. 

At Manta, we’ve implemented this approach by using Celestia for data availability. We were the first to use Celestia for DA, and in the first month alone, we saved our users around $1.8 million in gas fees. This demonstrates the tangible value and benefits of using a modular approach.

The key advantage of modularity is adaptability. It allows us to adjust and add new features as the emerging needs of the industry change. Instead of building new features from scratch every time the Web3 space evolves, we can find existing technologies, plug them into our infrastructure, and provide value directly to users. This approach allowed us to get to market earlier than others who waited for developments like Proto-danksharding on Ethereum.

How can AI technologies be leveraged to improve the efficiency and functionality of decentralized systems on L2 solutions?

Currently, AI technologies are largely used in the application layer. Their use at the infrastructure layer is likely to come in the future. However, when we think about scaling to accommodate a billion users, which is a benchmark in our space, we’ll need cooperation and coordination across various L2s to sustain that level of traffic.

One L2 alone can’t host a billion users simultaneously, just as Ethereum can’t host more than about 5,000 users without gas fees skyrocketing. We need horizontal scaling across multiple L2s, which will require load balancing. This is where AI can play a crucial role.

For example, AI could help balance applications and users across various L2s based on conditions like capacity and gas fees. If L2A is 80% full, L2B is 40% full, and L2C has the lowest gas fees, AI could help distribute the load optimally. This kind of AI-driven load balancing across L2s could be key to scaling out to that billion-user mark we’re aiming for.

How does horizontal scalability offer a solution to the challenges of L2 fragmentation, particularly in terms of cross-chain communication and liquidity sharing?

Horizontal scalability is about abstracting away and compartmentalizing the responsibilities of different layers in the stack. For instance, Ethereum’s current responsibility with the existence of L2s is security and decentralization, while L2s are responsible for scalability. 

In the future, liquidity could become a separate layer apart from the L2 itself. This liquidity layer could be accessed across various L2s as they scale out horizontally, addressing the challenges of fragmentation and enabling more efficient cross-chain communication and liquidity sharing.

What are the key benefits of implementing a multi-DA framework in blockchain systems, and how does it enhance network resilience?

Multi-DA goes back to the idea of modularity. As we move from building everything in-house to using third-party dependencies, we need to consider potential risks. What if a service we rely on, like Celestia, stops operating or no longer wants to service us? 

A multi-DA solution provides a backup plan. By leveraging technologies from various data availability solutions like Near’s Muffle, Eigen-DA, DIL, or Avail, we create redundancy. This approach highlights the need for resilience and redundant systems in an age of modular approaches, enhancing overall network resilience.

How might the integration of blockchain technology transform existing business models in traditional sectors, and what challenges might arise during this transition?

The biggest transformation blockchain brings is the globalization of technology. Unlike regional versions of platforms like Facebook, Web3 applications can be truly global and borderless, allowing large populations worldwide to use a single application.

One of the largest use cases in Web3 continues to be in finance. Blockchain can help globalize finance and unlock large amounts of liquidity around the world. For example, tokenizing stocks could give people in other countries access to markets like the New York Stock Exchange, which is currently limited mostly to US citizens and large institutions. This would benefit both the stocks by providing deeper liquidity and users by allowing them to participate in the growth of companies they normally don’t have access to.

Given the success of Asian gaming studios in Web2, what factors could contribute to Asia becoming a powerhouse in Web3 development?

The biggest factor is policy and regulation. Asia has already shown a strong example of being very proactive in setting clear rules and standards that have fostered a lot of innovation in the Asian ecosystem. We don’t see as much of this progress in the West, and this lack of clarity actually stifles innovation. The clarity and regulation in Asia would be and already are strong catalysts for Asian development in Web3.

How might the cultural and technological landscape in Asia influence the types of Web3 applications and use cases that emerge from the region?

In Asia, there’s more of a mentality of moving quickly, breaking things, and then patching them up. This approach has both advantages and disadvantages. Western projects tend to be more conscious of existing regulations, especially given the gray areas in the space. While this caution can stifle innovation, the Asian approach allows for quicker, iterative innovation.

In terms of regulations, Asia is generally more progressive than Europe and North America when it comes to cryptocurrency access and DeFi products. This gives developers and thinkers more flexibility and opportunity to get creative about building decentralized services.

How might the development of Web3 applications in Asia impact global adoption rates and the evolution of decentralized technologies?

From a pure numbers perspective, Asia encompasses a large percentage of the global human population, so adoption in Asia alone is quite significant. In terms of global adoption, the innovation happening in Asia’s Web3 space will likely be seen as competition by the rest of the world. This competition can drive further innovation and adoption as other regions try to catch up and unlock new opportunities in the Web3 space.

Are there any specific things that the West could take from the Asian example of mainstream adoption of Web3?

Yes, and it largely focuses on having incubation and support at the governmental level. This is common in Southeast Asian countries like Thailand, Vietnam, and Malaysia, and in places like Hong Kong and Taiwan. These governments are very proactive in terms of support and incubation for various projects in the space. This type of support is exactly what the space needs, rather than focusing primarily on taxation and how to make the most out of the industry from a purely governmental perspective.

What unique challenges and opportunities does the Asian market present for the implementation of crypto solutions in traditional business sectors?

The Asian markets have always had a lot of opportunities in the financial sector, which is where Web3 shines. The best product-market fit in Web3 has always been around financial tooling. Asia has a significant advantage here, being a global GDP leader, seeing a lot of emerging markets growing, and having specific financial hubs like Singapore and Hong Kong. The success of Asian-developed Web3 applications will likely drive global financial adoption and mainstream crypto adoption.

How do you see the overall development of blockchain in Asia in the next three years?

I think it’s going to be explosive. Many local governments are already educating themselves and thinking strategically about how to implement blockchain regimes into their policies. While in the West, discussions about crypto adoption by political figures like Trump and Kamala Harris are still in broad strokes, some Asian countries are already experimenting with integrating cryptocurrency and digital financial transactions into brick-and-mortar shops. These types of service offerings are already starting to emerge in Southeast Asia, putting the region at the forefront of blockchain development and adoption.

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