Unchained Podcast Summary
Episode Title: How Zero Blockchain Cracked 2M TPS Without Sacrificing Decentralization
Date: February 10, 2026
Host: Laura Shin
Guest: Brian Pellegrino, Co-founder and CEO, LayerZero Labs
Episode Overview
This episode centers on the launch of Xero, a new blockchain from LayerZero Labs, making a bold claim: achieving up to 2 million transactions per second (TPS) in a truly decentralized, permissionless architecture. Laura Shin and Brian Pellegrino dive deep into the technical breakthroughs, motivations, the involvement of major institutions, and the broader implications for crypto and global finance. Throughout, they address the limitations of current blockchains (like Ethereum and Solana), the evolution of scaling solutions, and how Xero leverages innovations in zero-knowledge proofs, storage, and network design.
Key Discussion Points & Insights
1. Genesis of Xero & Motivation
- Origin Story (03:22)
- Two and a half years ago, the project began from internal frustration at the direction of blockchain scalability.
- Pellegrino’s co-founder, Ryan, was “extremely upset” about Ethereum’s move away from sharding and perceived misleading marketing about scaling via Layer 2s.
- Architecturally, the problem: “If you have a million nodes, every single one ... is reproducing the same exact compute.” (04:10)
- Solution goal: Reduce duplication, enable massive scale without centralization.
2. Problems Xero Aims to Solve (05:37)
- Existing blockchains either:
- Prioritize performance by centralizing (e.g., Solana—fewer, more powerful nodes).
- Maintain decentralization but can’t scale due to Layer 2 trust bottlenecks (e.g., Ethereum).
- The “real promise” is decentralized, permissionless, censorship-resistant systems for the world—without sacrificing scale.
3. Technical Innovations and Achievements
Four Breakthroughs:
- QMDb (Storage Layer):
- Log-based database design, “100x more performant than state of the art ... 3 million updates per second.” (08:06)
- Accelerates read/write access, a key bottleneck.
- FAFO (Execution Layer):
- Demonstrated that EVM itself can be fast; “a single node EVM doing ... a million transactions per second.”
- Dispels myth that EVM (Ethereum Virtual Machine) is inherently slow.
- SVID (Network):
- Network data compression.
- ZK Proofs (Compression of Compute):
- Enables a “single proof” to stand in for all replicated compute—nodes only need to verify proofs, not redo all calculations.
- Cluster with 1 GHz prover: “We’ll stand on stage tomorrow and show verifying transactions at a million transactions per second in real time.” (08:06)
- Architecture Note:
- “The small nodes don’t need to trust the big nodes. ... They cannot do anything malicious because they must be able to verify this proof is bound by the ZK circuit.” (14:23)
4. Decentralization & Data Integrity (14:23)
- Heterogeneous Architecture:
- Mix of large “sequencer” nodes and millions of home stakers.
- Every node, even tiny ones, can fully verify blockchain state via ZK proofs—nothing meaningful is off-chain.
- “Everybody must be able to reconstruct and ... verify exactly what has happened.” (14:23)
5. Institutional Partnerships and Go-to-Market
-
Partners & Investors: (17:03–23:30)
- Citadel Securities, DTCC, Intercontinental Exchange (ICE), BNY Mellon, Cathie Wood, etc.
- Google Cloud as technical partner, Tether as payments partner.
- Rationale: Global markets are going 24/7, crossing asset classes and geographies. These partners represent critical infrastructure for that transition.
- “The goal is to co-build or lean on the expertise of how you build these systems.” (17:49)
-
Product-Tiered Launch:
- Launching with three “applications”: general-purpose smart contract zone, global markets, and payments.
6. Privacy & ZK Proof Applications (27:51)
- ZK Focus:
- Primarily used for compute compression, not privacy per se.
- For payments, privacy features will be explored deeply, but “privacy is a feature ... not the focus” for all use cases.
- “ZK’s most interesting part is compression ... ability to completely remove ... replication.” (28:02)
7. LayerZero and Xero: How They Connect (29:53)
- No Pivot, Full Interop:
- LayerZero will continue to connect all blockchains.
- “Xero will be connected to all 165 chains. ... This is not like a pivot.” (29:53)
- Token: (31:03)
- No new token for Xero. The existing LayerZero token will serve as staking and gas asset.
8. Lessons from LayerZero Development (32:01)
- “We just had very deeply understood the scaling approaches that everybody else was trying. Like what works and what doesn’t work.” (32:01)
- Insight: Storage, not compute, is the bottleneck for many chains.
- Re-designed Xero assuming ZK and performance were solved, enabling architecture “as fast as Solana, as decentralized as Ethereum.”
9. Building Adoption and Avoiding Hype Traps (36:03)
- No airdrops, no new token hype. Focus is not on building a hype-driven community, but “real adoption.”
- “Don’t care about how many people are in Discord ... care about like real systems that will drive adoption.” (36:55)
- Partnerships and actual, utility-driven usage are the priority.
10. Investment and Fundraising Approach (39:59)
- Xero did not do a formal fundraising round.
- Select partners asked to invest for strategic stake—“I don’t want you to think about it as a round ... it really is about the technology itself and that is the only thing that we care about.” (40:09)
Notable Quotes
-
On Motivation and Direction
“The core problem with any blockchain today is that if you have a million nodes, every single one ... is reproducing the same exact compute. You're paying effectively a million times the cost of doing the computation itself.”
— Brian Pellegrino (04:10) -
On Scaling Approaches
"Solana ... basically reduce[s] the number of nodes and increase[s] the requirements ... The other way ... is [Ethereum's] decentralization ... and start to scale through ... layer two."
— Brian Pellegrino (05:37) -
On Blockchains in Practice
"All the layer twos, all of Solana, everything combined, you're at like 6,700... transactions per second. It's like just not enough for real world systems."
— Brian Pellegrino (06:53) -
On ZK Proof Utility
“ZK’s most interesting part is compression ... ability to completely remove ... replication in these underlying systems.”
— Brian Pellegrino (28:02) -
On Adoption Approach
"Don’t care about how many people are in Discord ... care about like real systems that will drive adoption."
— Brian Pellegrino (36:55)
Timestamps for Key Segments
- How Xero Began & Vision — 03:22–05:20
- Problems With Current L1, L2 Designs — 05:20–07:49
- Technical Innovations Explained — 08:06–14:03
- Decentralization & Data Integrity — 14:23–17:03
- Institutional Adoption & Rationale — 17:03–23:30
- ZK Proofs: Privacy vs. Compression — 27:51–29:37
- LayerZero & Xero—Interoperability, Token — 29:53–31:32
- Lessons from LayerZero for Xero — 32:01–36:03
- Go-to-Market & Avoiding Hype — 36:03–39:59
- Investment Philosophy & Closing — 39:59–41:09
Memorable Moments
- Mainstream Readiness: Pellegrino notes that major institutions are rapidly moving from POCs to “actually building systems,” marking an inflection point for blockchain. (17:49)
- Live Demo Commitment: Live demonstration of “a million transactions per second in real time … on a Raspberry Pi.” (32:01)
- Architecture Inversion: Starting from the assumption that ZK technology is “solved,” designing the rest of the chain around that hypothetical.
Final Thoughts
LayerZero Labs’ Xero claims to shatter the assumed tradeoff between blockchain decentralization and real-world throughput, basing this achievement on deep architectural innovation and institutional engagement. The conversation reflects mature reflection on crypto’s infrastructural shortfalls, a technologist’s approach to first principles, and an intention to solve real, global problems—beyond crypto-native circles.
This episode is a must-listen for anyone interested in the future of blockchain scalability, institutional adoption, and the next generation of permissionless financial infrastructure.