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I'm building in this space, I take a docker inside a microvm (vm-lite) approach.

And the cycle continues

It's just fun ;)

I wonder if inside the docker container we can run a sandboxed WASM runtime?

Do you mean something like gVisor?

"All problems in computer science can be solved by another level of indirection"

ad infinitum ;-)

"... except for the problem of too many levels of indirection."

that's solved with an off-by-one error