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This is an OS-less web server VM, basically an modified Erlang VM to run directly on "almost" bare-metal

Actually, we didn't modify Ericsson's Erlang VM, we have written our own.

Impressive, is that what Zerg is about? where can I find more information about this?

Zerg is just a demo that shows how elastic and scalable could be OSless VMs even over current cloud infrastructure